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Item 8. Financial Statements and Supplementary Data

2026-02-19 compared with 2025-02-27 · 265 added, 237 removed, 1077 unchanged (32% of the section changed)

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Audited Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm (ID 238 PricewaterhouseCoopers LLP)

Report of Independent Registered Public Accounting Firm (ID 185 KPMG LLP)

Report of Independent Registered Public Accounting Firm (ID 238 Pricewaterhouse Coopers LLC)

Consolidated Balance Sheets

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Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Spyre Therapeutics, Inc.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Spyre Therapeutics, Inc.

and its subsidiaries (the "Company") as of December 31, 2024 and 2023, and the related consolidated statements of operations, of comprehensive loss, of changes in convertible preferred stock and stockholders’ equity and of cash flows for each of the three years in the period ended December 31, 2024, including the related notes (collectively referred to as the "consolidated financial statements").

We also have audited the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024 in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company did not maintain, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO because a material weakness in internal control over financial reporting existed as of that date related to the Company not designing and maintaining effective controls to evaluate the treatment of the Series A Preferred Stock and the Series B Preferred Stock for the purpose of calculating earnings per share under the two-class method.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

The material weakness referred to above is described in Management’s Annual Report on Internal Control Over Financial Reporting appearing under Item 9A.

We considered this material weakness in determining the nature, timing, and extent of audit tests applied in our audit of the 2024 consolidated financial statements, and our opinion regarding the effectiveness of the Company’s internal control over financial reporting does not affect our opinion on those consolidated financial statements.

To the Stockholders and Board of Directors

Spyre Therapeutics, Inc.:

Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting

We have audited the accompanying consolidated balance sheet of Spyre Therapeutics, Inc.

and subsidiaries (the Company) as of December 31, 2025, the related consolidated statements of operations, comprehensive loss, changes in convertible preferred stock and stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively, the consolidated financial statements).

We also have audited the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025, and the results of its operations and its cash flows for the year then ended, in conformity with U.S.

generally accepted accounting principles.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025 based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in management's report referred to above.

Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits.

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting.

Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting 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.

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Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Our audit of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated 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 consolidated 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 consolidated financial statements.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that

a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audits also included performing such other procedures as we considered necessary in the circumstances.

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A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements

in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) 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 a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Contingent Value Right (CVR) Liability

As described in Notes 1, 2, and 3 to the consolidated financial statements, in connection with the asset acquisition of Pre-Merger Spyre, a non-transferable contingent value right was distributed to certain legacy stockholders of record as of the close of business on July 3, 2023 entitling holders of the contingent value right to receive certain cash payments from proceeds received by the Company related to the disposition or monetization of the Company’s legacy assets.

Management determined that certain contingent payments under the Contingent Value Rights (CVR) Agreement qualified as derivatives, and as such, were recorded as a liability on the balance sheet.

For derivative financial instruments accounted for as liabilities, the derivative instrument is initially recorded by management at its fair value and is then re-valued at each reporting date.

Critical Audit Matter

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

Evaluation of the fair value of the contingent value right liability

Holders of the CVR are entitled to receive certain cash payments from proceeds received by the Company prior to the third anniversary of the CVR Agreement, if any, related to the disposition or monetization of the Company’s legacy assets during the one-year period following the closing of the Asset Acquisition.

Management determined that certain contingent payments under the CVR Agreement qualified as derivatives and were recorded as a liability on the balance sheet.

For derivative financial instruments accounted for as liabilities, the derivative instrument is initially recorded by management at its estimated fair value and is re-valued at each reporting date with changes recorded as other income (expense).

The fair value of the CVR liability was determined using the probability weighted discounted cash flow method to estimate future cash flows associated with the sale of the legacy assets.

The CVR liability value is based on significant inputs not observable in the market such as estimated cash flows, estimated probabilities of regulatory success, estimated reimbursement rates compared to the reimbursement target, and risk-adjusted discount rates.

The CVR liability as of December 31, 2024 was $61.7 million and the Company recognized an increase in the CVR liability of $19.0 million for the year ended December 31, 2024 related to the change in fair value between December 31, 2023 and December 31, 2024 of $20.4 million offset by payments of $1.4 million.

The principal considerations for our determination that performing procedures relating to the valuation of the CVR liability is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the CVR liability;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to the estimated probabilities of regulatory success, estimated reimbursement rates compared to the reimbursement target, and risk-adjusted discount rates;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the valuation of the contingent value rights liability, including controls over the significant assumptions and underlying data.

These procedures also included, among others (i) evaluating the terms of the CVR agreement;

(ii) testing management’s process for developing the fair value estimate of the CVR liability;

(iii) evaluating the appropriateness of the probability weighted discounted cash flow method used by management;

(iv) testing the completeness and accuracy of underlying data used by management in the probability weighted discounted cash flow method;

and (v) evaluating the reasonableness of the significant assumptions used by management related to the estimated probabilities of regulatory success, estimated reimbursement rates compared to the reimbursement target, and risk-adjusted discount rates.

Evaluating management’s assumptions related to estimated probabilities of regulatory success and estimated reimbursement rates compared to the reimbursement target involved evaluating whether the assumptions used by management were reasonable considering the consistency with (i) external market and industry data and (ii) evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the probability weighted discounted cash flow method and (ii) the reasonableness of the risk-adjusted discount rate assumption.

As discussed in Note 3 to the consolidated financial statements, the CVR liability as of December 31, 2025 was $26.7 million.

We identified the evaluation of the fair value of the CVR liability as a critical audit matter.

Subjective auditor judgment was required to evaluate certain key assumptions that are based on the outcome of uncertain future events, specifically the estimated probabilities of regulatory success and estimated cash flow dates assumptions.

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s CVR liability valuation process, including controls over the estimated probabilities of regulatory success and estimated cash flow dates key assumptions utilized to determine the fair value of the CVR liability.

We tested the completeness and accuracy of the underlying data for these key assumptions used in the probability weighted discounted cash flow method.

We evaluated the reasonableness of these key assumptions by comparing them to relevant publicly available market and industry data and assessing probable outcomes, including likelihood of occurrence and impact on the fair value of the CVR liability.

We have served as the Company’s auditor since 2025.

San Diego, California

February 19, 2026

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Spyre Therapeutics, Inc.

Opinion on the Financial Statements

We have audited the consolidated balance sheet of Spyre Therapeutics, Inc.

and its subsidiaries (the “Company”) as of December 31, 2024, and the related consolidated statements of operations, of comprehensive loss, of changes in convertible preferred stock and stockholders’ equity and cash flows for each of the two years in the period ended December 31, 2024, including the related notes as of and for each of the two years in the period ended December 31, 2024 (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 as of December 31, 2024 , and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these consolidated financial statements 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 consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated 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 consolidated financial statements.

We believe that our audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

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February 27, 2025

We have served as the Company’s auditor since 2014.

We served as the Company's auditor from 2014 to 2025.

Spyre Therapeutics, Inc.

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Total current assets 777,781 608,474

Restricted cash — 322

Other non-current assets — 10

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Commitments and Contingencies (Note 8, Note 9)

Series B non-voting convertible preferred stock, $ 0.0001 par value;

150,000 shares authorized, issued, and outstanding as of December 31, 2023.

STOCKHOLDERS’ EQUITY

CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

Series A non-voting convertible preferred stock, $ 0.0001 par value;

1,086,341 shares authorized as of December 31, 2024 and December 31, 2023;

346,045 and 437,037 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively.

1,086,341 shares authorized and 346,045 shares issued and outstanding as of December 31, 2025 and December 31, 2024.

146,425 146,425

Series B non-voting convertible preferred stock, $ 0.0001 par value;

271,625 shares authorized and 16,667 shares issued and outstanding as of December 31, 2024.

271,625 shares authorized and 16,667 shares issued and outstanding as of December 31, 2025 and December 31, 2024.

Preferred stock, $ 0.0001 par value;

8,642,034 shares and 8,763,659 shares authorized as of December 31, 2024 and December 31, 2023, respectively;

no shares issued and outstanding as of December 31, 2024 and December 31, 2023.

8,642,034 shares authorized and no shares issued and outstanding as of December 31, 2025 and December 31, 2024.

Common stock, $ 0.0001 par value;

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Accumulated deficit ( 1,127,635 ) ( 972,432 )

TOTAL STOCKHOLDERS’ EQUITY 517,804 184,016

TOTAL CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

715,236 517,804

TOTAL LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

$ 777,781 $ 608,484

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

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General and administrative (2)

47,909 45,776 39,946

Acquired in-process research and development — — 130,188

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Change in fair value of forward contract liability — — ( 83,530 )

Other expense, net ( 20,713 ) ( 19,130 ) ( 7 )

Other income (expense), net

29,459 ( 20,713 ) ( 19,130 )

Total other income (expense) 54,344 599 ( 96,513 )

Loss before income tax expense ( 155,218 ) ( 207,967 ) ( 338,816 )

Income tax (expense) benefit ( 51 ) 26 136

Income tax benefit (expense)

Net loss $ ( 155,203 ) $ ( 208,018 ) $ ( 338,790 )

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Weighted-average common shares outstanding, basic and diluted 64,056,442 47,027,638 6,897,065

(1) Includes $ 41.2 million and $ 48.5 million in related party expenses for the years ended December 31, 2024 and December 31, 2023, respectively, and no related party expenses for the year ended December 31, 2022.

(1) Includes $ 10.5 million, $ 40.1 million and $ 48.5 million in related party expenses for the years ended December 31, 2025, 2024 and 2023, respectively.

(2) Includes $ 1.0 million, $ 1.1 million and $ 0.1 million in related party expenses for the years ended December 31, 2025, 2024 and 2023, respectively.

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

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Foreign currency translation adjustment ( 22 ) 4 37

Unrealized (loss) gain on marketable securities ( 126 ) 313 7

Unrealized gain (loss) on marketable securities

711 ( 126 ) 313

Total comprehensive loss $ ( 154,514 ) $ ( 208,140 ) $ ( 338,440 )

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Balances—December 31, 2022 — $ — — $ — — $ — 2,614 $ 6 $ 475,971 $ ( 48 ) $ ( 425,624 ) $ 50,305

Issuance of common stock and pre-funded warrants in connection with registered direct offering, net of offering costs — — — — — — 430 1 42,873 — — 42,874

Issuance of common stock in connection with exercise of pre-funded warrants — — — — — — 204 — — — — —

Issuance of common stock in connection with employee stock purchase plan — — — — — — 6 — 222 — — 222

Stock-based compensation expense — — — — — — — — 7,111 — — 7,111

Foreign currency translation adjustment — — — — — — — — — ( 35 ) — ( 35 )

Unrealized gain on marketable securities — — — — — — — — — 7 — 7

Net loss — — — — — — — — — — $ ( 83,815 ) $ ( 83,815 )

Balances—December 31, 2022 — $ — — $ — — $ — 2,614 $ 6 $ 475,971 $ ( 48 ) $ ( 425,624 ) $ 50,305

Issuance of Series A non-voting convertible preferred stock in connection with private placement, net of financing costs — — 721 197,364 — — — — — — — 197,364

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Stockholder approval of the issuance of common stock upon conversion of Series B convertible non-voting preferred stock ( 272 ) ( 253,405 ) — — 272 253,405 — — — — — 253,405

Exchange of Series A non-voting convertible preferred stock for common stock — — ( 91 ) ( 38,502 ) — — 3,640 1 38,501 — — —

Conversion of Series B non-voting convertible preferred stock into common stock — — — — ( 255 ) ( 244,010 ) 10,198 1 244,009 — — —

Exchange of Series A non-voting convertible preferred stock for common stock — — ( 91 ) ( 38,502 ) — — 3,640 1 38,501 — — —

Issuance of common stock in connection with at-the-market offering program, net of financing costs — — — — — — 777 — 20,504 — — 20,504

Issuance of common stock in connection with follow-on offering, net of financing costs — — — — — — 8,366 1 215,673 215,674

Issuance of common stock in connection with exercise of pre-funded warrants — — — — — — 250 — 1 — — 1

Issuance of common stock in connection with follow-on offering, net of financing costs — — — — — — 8,366 1 215,673 215,674

Issuance of common stock in connection with exercise of stock options and employee stock purchase plan — — — — — — 931 — 7,511 — — 7,511

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Issuance of Parapyre Option Obligation warrants — — — — — — — — 14,459 — — 14,459

CVR distribution to common stockholders — — — — — — 38 — — — — —

Foreign currency translation adjustment — — — — — — — — — 4 — 4

Unrealized loss on marketable securities

— — — — — — — — — ( 126 ) — ( 126 )

Net loss — — — — — — — — — — ( 208,018 ) ( 208,018 )

Balances—December 31, 2024 — $ — 346 $ 146,425 17 $ 9,395 60,257 $ 13 $ 1,334,223 $ 180 $ ( 972,432 ) $ 517,804

Issuance of common stock in connection with follow-on offering, net of financing costs — — — — — — 17,095 2 296,279 296,281

Issuance of common stock in connection with at-the-market offering program, net of financing costs — — — — — — 446 — 14,745 — — 14,745

Issuance of common stock in connection with exercise of stock options and employee stock purchase plan — — — — — — 354 — 3,306 — — 3,306

Stock-based compensation expense — — — — — — — — 37,614 — — 37,614

Vesting of restricted stock units — — — — — — — 38 — — — — — — —

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Amortization of operating lease assets — — 220

Other — 15 426

Changes in operating assets and liabilities:

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Related party accounts payable ( 589 ) ( 15,981 ) ( 2,402 )

( 15,981 ) ( 2,402 ) —

Net cash used in operating activities ( 169,252 ) ( 157,410 ) ( 99,910 )

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Proceeds from sale of in-process research & development asset 7,000 — 15,000

Purchases of property and equipment — — ( 38 )

Proceeds from the sale of property plant and equipment — — 475

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Proceeds from maturities and sales of marketable securities 371,739 245,967 39,900

Net cash provided by (used in) investing activities ( 353,285 ) ( 108,393 ) 57,008

Net cash (used in) provided by investing activities

( 143,475 ) ( 353,285 ) ( 108,393 )

CASH FLOWS FROM FINANCING ACTIVITIES

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Payment of contingent value rights liability ( 5,251 ) ( 1,430 ) ( 5,786 )

Proceeds from issuance of common stock and pre-funded warrants in registered direct offering, net of offering costs 1 — 42,874

Proceeds from employee stock option exercises and employee stock plan purchases 3,306 7,511 405

Principal payments on finance lease obligation — ( 16 ) ( 418 )

Other financing cash flows

Net cash provided by financing activities 309,025 410,906 361,077

Effect of exchange rate on cash, cash equivalents, and restricted cash — ( 3 ) 25

NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH

NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH

( 3,702 ) ( 99,792 ) 152,799

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Conversion of Series A non-voting convertible preferred stock into common stock $ — $ — $ 202,178

$ — $ 202,178 $ —

Leased assets obtained in exchange for lease obligations $ — $ — $ 21

Reconciliation of Cash, Cash Equivalents, and Restricted Cash Reported in the Statement of Financial Position

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In connection with the Asset Acquisition, a non-transferable contingent value right ("CVR") was distributed to stockholders of record of the Company as of the close of business on July 3, 2023 (the "Legacy Stockholders"), but was not distributed to the holders of shares of common stock or Series A Preferred Stock issued to the former stockholders of Pre-Merger Spyre or June 2023 Investors in the June 2023 Transactions.

Holders of the CVRs will be entitled to receive cash payments from proceeds received by the Company for a 3 -year period related to the disposition or monetization of its legacy assets for a period of one-year following the closing of the Asset Acquisition.

Holders of the CVRs will be entitled to receive certain cash payments from proceeds received by the Company prior to the third anniversary of the CVR Agreement, if any, related to the disposition or monetization of its legacy assets during the one-year period following the closing of the Asset Acquisition.

For additional information, see Note 3 .

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16,667 shares of Series B Preferred Stock did not automatically convert and remained outstanding as of December 31, 2025.

On September 6, 2024, the Company filed a new shelf registration statement on Form S-3 that was declared effective by the SEC for the potential offering, issuance and sale by the Company of up to $ 500.0 million of our common stock, preferred stock, debt securities, warrants and/or units consisting of all or some of these securities.

Concurrent with the filing of the shelf-registration statement, the Company entered into a sales agreement with TD Securities (USA) LLC (“TD Cowen”), as its sales agent, pursuant to which the Company may issue and sell shares of its common stock for an aggregate offering price of up to $ 200.0 million under an at-the-market (“ATM") offering program included in the shelf registration.

During the year ended December 31, 2024, the Company sold an aggregate of 777,432 shares of common stock under the ATM at an average price per share of $ 26.935 , resulting in aggregate net proceeds of approximately $ 20.5 million after deducting $ 0.4 million in commissions paid to TD Cowen as sales agent and other offering costs.

On November 18, 2024, the Company entered into an underwriting agreement (the "Underwriting Agreement") with Jefferies LLC, Goldman Sachs & Co.

On September 6, 2024, the Company filed a new shelf registration statement on Form S-3 that was declared effective by the SEC for the potential offering, issuance and sale by the Company of up to $ 500.0 million of its common stock, preferred stock, debt securities, warrants and/or units consisting of all or some of these securities.

Concurrent with the filing of the shelf-registration statement, the Company entered into a sales agreement, dated September 6, 2024, with TD Securities (USA) LLC (“TD Cowen”) ("Sales Agreement"), as its sales agent, pursuant to which the Company may issue and sell shares of its common stock for an aggregate offering price of up to $ 200.0 million under an at-the-market (“ATM”) offering program included in the shelf registration.

During the year ended December 31, 2024, the Company sold an aggregate of 777,432 shares of common stock under the ATM resulting in aggregate net proceeds of approximately $ 20.5 million after deducting commissions paid to TD Cowen as sales agent and other offering costs.

On November 18, 2024, the Company entered into an underwriting agreement (the "November 2024 Underwriting Agreement") with Jefferies LLC, Goldman Sachs & Co.

LLC, Evercore Group L.L.C.

and Guggenheim Securities, LLC as representatives of the several underwriters (collectively, the "Underwriters"), pursuant to which the Company sold an aggregate of 8,366,250 shares of its common stock, inclusive of 1,091,250 shares pursuant to the full exercise of an over-allotment option, at a public offering price per share of $ 27.50 , resulting in net proceeds of approximately $ 215.9 million after deducting approximately $ 14.2 million of underwriting discounts and other offering costs (the "November 2024 Offering").

The November 2024 Offering closed on

November 20, 2024 and the over-allotment option was exercised in full on November 26, 2024 and closed on November 29, 2024.

and Guggenheim Securities, LLC as representatives of the several underwriters (collectively, the "November 2024 Underwriters"), pursuant to which the Company sold an aggregate of 8,366,250 shares of its common stock, inclusive of 1,091,250 shares pursuant to the full exercise of the November 2024 Underwriters' over-allotment option, at a public offering price per share of $ 27.50 , resulting in net proceeds of approximately $ 215.9 million after deducting approximately $ 14.2 million of underwriting discounts and other offering costs (the "November 2024 Offering").

The November 2024 Offering closed on November 20, 2024 and the over-allotment option was exercised in full on November 26, 2024 and closed on November 29, 2024.

In February 2025, the Company filed a new shelf registration statement on Form S-3 (the "February 2025 Shelf Registration Statement") that was declared effective by the SEC for the potential offering, issuance

and sale of up to $ 500.0 million of shares of common stock, preferred stock, debt securities, warrants and/or units consisting of all or some of these securities.

Concurrent with the effectiveness of the February 2025 Shelf Registration Statement, the offering of unsold securities under a previous shelf registration statement on Form S-3 (File No.

333-281975), which was initially filed with the SEC on September 6, 2024 and became effective on September 18, 2024, was deemed terminated pursuant to Rule 415(a)(6) under the Securities Act.

The February 2025 Shelf Registration Statement contains a sales agreement prospectus supplement covering the offering, issuance and sale by the Company of up to $ 179.1 million of shares of common stock that may be issued and sold under the Sales Agreement in connection with the ATM offering program.

During the three and twelve months ended December 31, 2025, the Company sold an aggregate of 445,668 shares of common stock under the ATM offering program at an average price per share of $ 33.772 resulting in net proceeds of $ 14.8 million, after deducting sales agent commissions and other offering costs of $ 0.3 million.

As of December 31, 2025, $ 164.1 million remained available for sale under the Sales Agreement.

Subsequent to December 31, 2025 through February 12, 2026 the Company sold an aggregate of 296,396 shares of common stock under the ATM offering program at an average price per share of $ 33.566 resulting in net proceeds of $ 9.7 million after deducting sales agent commissions and other offering costs of $ 0.2 million.

On October 13, 2025, the Company entered into an underwriting agreement (the "October 2025 Underwriting Agreement") with Jefferies LLC, TD Securities (USA) LLC, Leerink Partners LLC and Stifel, Nicolaus & Company, Incorporated as representatives of the several underwriters (collectively, the "October 2025 Underwriters"), pursuant to which the Company sold an aggregate of 17,094,594 shares of its common stock, inclusive of 2,229,729 shares pursuant to the full exercise of the October 2025 Underwriters' over-allotment option, at a public offering price per share of $ 18.50 , resulting in net proceeds of approximately $ 296.4 million after deducting approximately $ 19.9 million of underwriting discounts and other offering costs (the "October 2025 Offering").

The over-allotment option was exercised in full on October 14, 2025 and the transaction closed on October 15, 2025.

The Company is a clinical stage biotechnology company with a limited operating history, and due to its significant research and development expenditures, the Company has generated operating losses since its inception and has not generated any revenue from the commercial sale of any products.

There can be no assurance that profitable operations will ever be achieved, and, if achieved, whether profitability can be sustained on a continuing basis.

Since its inception and through December 31, 2024, the Company has funded our operations by raising an aggregate of approximately $ 1.3 billion of gross proceeds from the sale and issuance of convertible preferred stock and common stock, pre-funded warrants, the collection of grant proceeds, and the licensing of its product rights for commercialization of pegzilarginase in Europe and certain countries in the Middle East.

As of December 31, 2024, Spyre had an accumulated deficit of $ 972.4 million, and cash, cash equivalents, and marketable securities of $ 603.1 million.

Since its inception and through December 31, 2025, the Company has funded its operations by raising an aggregate of approximately $ 1.6 billion of gross proceeds from the sale and issuance of convertible preferred stock and common stock, pre-funded warrants, the collection of grant proceeds, and the licensing of its product rights for commercialization of pegzilarginase in Europe and certain countries in the Middle East.

As of December 31, 2025, Spyre had an accumulated deficit of $ 1.1 billion, and cash, cash equivalents, and marketable securities of $ 756.5 million.

Based on current operating plans, the Company has sufficient resources to fund operations for at least one year from the issuance date of these financial statements with existing cash, cash equivalents, and marketable securities.

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Actual results could differ significantly from those estimates.

The most significant estimates and assumptions that management considers in the preparation of the Company's financial statements relate to the valuation of consideration transferred in acquiring in-process research & development ("IPR&D");

The most significant estimates and assumptions that management considers in the preparation of the Company's financial statements relate to accrued research and development costs;

the valuation of consideration transferred in acquiring in-process research & development ("IPR&D");

the discount rate, probabilities of success, and timing of estimated cash flows in the valuation of the CVR liability;

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Restricted Cash

Restricted cash consisted of cash balances related to the Company's operations in the United Kingdom for the period ended December 31, 2023.

There were no restricted cash balances as of December 31, 2024.

Restricted cash consisted of cash balances related to the Company's former operations in the United Kingdom for the period ended December 31, 2023.

There were no restricted cash balances as of December 31, 2025 and 2024.

Concentration of Credit Risk

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Leasehold improvements Shorter of remaining lease term or estimated useful life

The Company did not have any property, plant, and equipment assets as of December 31, 2025 and 2024.

Impairment of Long-Lived Assets

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As actual costs become known, the Company adjusts its accruals.

Inputs, such as the services performed, the number of patients enrolled, or the study duration, may vary from the Company’s estimates, resulting in adjustments to research and development expense in future periods.

Inputs, such as the services performed, the number of patients enrolled, or the trial duration, may vary from the Company’s estimates, resulting in adjustments to research and development expense in future periods.

Changes in these estimates that result in material changes to the Company’s accruals could materially affect the Company’s results of operations.

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License Agreements Contingent Milestone Payments

The Company’s license agreements include specific development, regulatory, and clinical milestone payments that are payable upon the resolution of a contingency, such as upon the selection of a development candidate, first dosing of a human patient in clinical trials or receipt of the Food Drug and Administration’s (“FDA”) approval of a Spyre drug.

Food Drug and Administration’s (“FDA”) approval of a Spyre drug.

The achievement of these milestone payments involves many factors outside of the Company’s control and therefore the associated likelihood cannot be considered probable until the related contingency is resolved.

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Right-of-use ("ROU") assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease.

The classification of the Company's

leases as operating or finance leases along with the initial measurement and recognition of the associated ROU assets and lease liabilities is performed at the lease commencement date.

The classification of the Company's leases as operating or finance leases along with the initial measurement and recognition of the associated ROU assets and lease liabilities is performed at the lease commencement date.

The measurement of lease liabilities is based on the present value of future lease payments over the lease term.

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The Company also elected to not apply the recognition requirement of Topic 842 to leases with a term of 12 months or less for all classes of assets.

As of December 31, 2025 and 2024, the Company had no operating or finance lease obligations.

Fair Value of Financial Instruments

The Company uses fair value measurements to record fair value adjustments to certain financial and non-financial assets and liabilities and to determine fair value disclosures.

The accounting standards define fair value, establish a framework for measuring fair value, and require disclosures about fair value measurements.

The accounting standards define fair

value, establish a framework for measuring fair value, and require disclosures about fair value measurements.

Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

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If a promised good or service is not distinct, the Company is required to combine that good or service with other promised goods or services until it identifies a bundle of goods or services that is distinct.

Arrangements that include rights to additional goods or services that are exercisable at a customer’s discretion are generally considered options.

Arrangements that include rights to additional goods or services that are exercisable at a customer’s

discretion are generally considered options.

The Company assesses if these options provide a material right to the customer and if so, they are considered performance obligations.

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The Company applies a scenario-based method and weighs them based on the possible achievement of certain milestones.

The milestone payments are contingent on formal reimbursement decisions by national authorities in key European markets and pegzilarginase approval by the U.S.

Food and Drug Administration ("FDA"), among other events.

The milestone payments are contingent on formal reimbursement decisions by national authorities in key European markets and pegzilarginase approval by the FDA, among other events.

This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in ASC 820, Fair Value Measurement.

The key assumptions used include the discount rate, probability of regulatory success, and reimbursement rates from certain government agencies.

The key assumptions used include the discount rate, probability of regulatory success, reimbursement rates from certain government agencies and estimated cash flow dates.

The estimated value of the CVR consideration is based upon available information and certain assumptions which the Company's management believes are reasonable under the circumstances.

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A valuation allowance is established against the deferred tax assets to reduce their carrying value to an amount that is more likely than not to be realized.

The deferred tax assets and liabilities are classified as noncurrent along with the related valuation allowance.

The deferred tax assets and liabilities are classified as

noncurrent along with the related valuation allowance.

Due to a lack of earnings history, the net deferred tax assets have been fully offset by a valuation allowance.

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Recently Adopted Accounting Pronouncements

The Company early adopted the Financial Accounting Standards Board’s ("FASB") Accounting Standards Update 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), effective as of January 1, 2023 using the modified retrospective method.

amendments, ASU 2020-06 eliminates the cash conversion and beneficial conversion feature models in ASC 470-20 that required an issuer of certain convertible debt and preferred stock to separately account for embedded conversion features as a component of equity, as well as changes the accounting for diluted earnings‑per‑share for convertible instruments and contracts that may be settled in cash or stock.

Additionally, ASU 2020-06 requires the if‑converted method, which is more dilutive than the treasury stock method, be used for all convertible instruments.

The Company applied ASU 2020-06 to all Series A Preferred Stock and Series B Preferred Stock during fiscal year 2023, and, accordingly, the Company did not apply the cash conversion or beneficial conversion feature models in its analysis of the Series A Preferred Stock and Series B Preferred Stock.

The adoption of ASU 2020-06 did not have a material impact on the Company's consolidated financial statements.

The Company adopted the FASB Standards Update 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures ("ASU 2023-07") effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

Among other amendments, ASU 2023-07 requires issuers to provide enhanced disclosures about significant segment expenses and information used to assess segment performance on an annual and interim basis.

The ASU also requires companies with a single reportable segment, such as the Company, to provide all disclosures required by Topic 280 - Segment Reporting.

The Company adopted this ASU with the fiscal year ending December 31, 2024, and applied the amendments retrospectively to all prior periods presented in the consolidated financial statements.

See Note 19, Segment Reporting.

In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures, to require enhanced income tax disclosures to provide information to assess how an entity’s operations and related tax risks, tax planning, and operational opportunities affect its tax rate and prospects for future cash flows.

The amendments in this update provide that a business entity disclose (1) a tabular income tax rate reconciliation, using both percentages and amounts, (2) separate disclosure of any individual reconciling items that are equal to or greater than 5% of the amount computed by multiplying the income (loss) from continuing operations before income taxes by the applicable statutory income tax rate, and disaggregation of certain items that are significant and (3) amount of income taxes paid (net of refunds received) disaggregated by federal, state and foreign jurisdictions, including separate disclosure of any individual jurisdictions greater than 5% of total income taxes paid.

These amendments are effective for the Company for annual periods in beginning in 2025, applied prospectively, with early adoption and retrospective application permitted.

The Company applied the amendments prospectively for the year ended December 31, 2025, and the impact of the adoption of the amendments in this update was not material to the Company’s consolidated financial position and results of operations since the amendments require only enhancement of existing income tax disclosures in the footnotes to the Company’s consolidated financial statements.

See Note 18, Income Taxes.

Not Yet Adopted Accounting Pronouncements

I n December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

This ASU expands disclosures in an entity’s income tax rate reconciliation table and disclosures regarding taxes paid both in the U.S.

and foreign jurisdictions.

This update is effective for fiscal years beginning after December 15, 2024.

This ASU will have no impact on the Company’s consolidated financial condition or results of operations.

The Company is currently evaluating the impact to its income tax disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

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The Company is currently evaluating the impact of adopting ASU 2024-03 on its disclosures.

In December 2025, the FASB issued ASU No.

2025-11, Interim Reporting (Topic 270):

Narrow-Scope Improvements.

The ASU clarifies interim disclosure requirements and the applicability of Topic 270.

The objective of the amendments is to provide further clarity about the current interim disclosure requirements.

The ASU is effective for interim reporting periods within annual reporting periods beginning after December 15,

Adoption of this ASU can be applied either a prospective or a retrospective approach.

Early adoption is permitted.

The Company is currently evaluating the impact of adopting ASU 2024-03 on its disclosures.

In December 2025, the FASB issued ASU No.

2025-12, Codification Improvements.

The update represents changes to the Codification that clarify, correct errors in or make other improvements to a variety of topics that are intended to make it easier to understand and apply.

Generally, the amendments in this Update are not intended to result in significant changes for most entities.

The ASU is effective for interim reporting periods within annual reporting periods beginning after December 15, 2026.

The adoption method of this ASU may vary, on an issue-by-issue basis.

Early adoption is permitted.

The Company is currently evaluating the impact of adopting ASU 2024-03 on its disclosures.

Fair Value Measurements

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Total liabilities $ — $ — $ 61,700 $ 61,700

The Company measures the fair value of money market funds on quoted prices in active markets for identical asset or liabilities.

The Company measures the fair value of money market funds and U.S.

government treasury securities on quoted prices in active markets for identical asset or liabilities.

The Level 2 assets include U.S.

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This forward contract was classified as a liability because the underlying preferred shares were contingently redeemable.

underlying price per share on an as-converted basis of the June 2023 PIPE Securities issued in the June 2023 PIPE.

Further, the forward contract liability was considered a Level 2 liability based on observable market data for substantially the full term of the liability and was initially measured at its estimated fair value on the transaction date based on the underlying price per share on an as-converted basis of the June 2023 PIPE Securities issued in the June 2023 PIPE.

Subsequent remeasurement of the fair value of the forward contract liability through its settlement date was based on the market price of the Company's common stock, which represents the redemption value of the Series A Preferred Stock.

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In connection with the Asset Acquisition, a non-transferable contingent value right was distributed to the Legacy Stockholders, but was not distributed to holders of shares of the Company's common stock or Series A Preferred Stock issued to the June 2023 Investors or former stockholders of Pre-Merger Spyre in connection with the June 2023 Transactions.

Holders of the CVR will be entitled to receive certain cash payments from proceeds received by the Company for a three-year period, if any, related to the disposition or monetization of the Company’s legacy assets for a period of one year following the closing of the Asset Acquisition.

Holders of the CVRs will be entitled to receive certain cash payments from proceeds received by the Company prior to the third anniversary of the CVR Agreement, if any, related to the disposition or monetization of the Company’s legacy assets during the one -year period following the closing of the Asset Acquisition.

The fair value of the CVR liability was determined using the probability weighted discounted cash flow method to estimate future cash flows associated with the sale of the legacy assets.

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Changes in fair value of the liability will be recognized as a component of Other income (expense) in the consolidated statement of operations and comprehensive loss in each reporting period.

The liability value is based on significant inputs not observable in the market such as estimated cash flows, estimated probabilities of regulatory success, and discount rates, which represent a Level 3 measurement within the fair value hierarchy.

The liability value is based on significant inputs not observable in the market such as estimated cash flows, estimated probabilities of regulatory success, and

discount rates, which represent a Level 3 measurement within the fair value hierarchy.

The significant inputs used to estimate the fair value of the CVR liability were as follows:

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Risk-adjusted discount rates 9.85 % - 9.97 %

The change in fair value between December 31, 2023 and December 31, 2024 was a $ 20.4 million increase, and was primarily driven by changes in the expected timing of achievement of certain milestones, changes in the likelihood of certain milestones related to the approval received from the European Medicines Agency by Immedica Pharma AB ("Immedica"), partially offset by a change in the likelihood of a successful disposition of pegtarviliase and updates to expenses and deductions.

The change in fair value between December 31, 2024 and December 31, 2025 was a $ 29.8 million decrease, primarily driven by changes in the likelihood of achievement of certain milestones and receipt of certain cash consideration within the CVR term, changes in estimated reimbursement rates compared to reimbursement target rates, changes in estimated cash flow dates, and an increase in risk-adjusted discount rates, partially offset by time value of money adjustments.

The following table presents changes in the CVR liability for the periods presented (in thousands):

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Commercial paper 9,987 — — 9,987

government treasury securities — — — —

Total cash equivalents $ 83,991 $ — $ — $ 83,991

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Corporate bonds 58,296 ( 23 ) — — 58,296 ( 23 )

government treasury securities 126,588 ( 296 ) — — 126,588 ( 296 )

government agency securities 22,828 ( 13 ) — — 22,828 ( 13 )

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Fair Value Unrealized

Commercial paper $ 67,200 $ ( 77 ) $ — $ — $ 67,200 $ ( 77 )

Corporate bonds 42,916 ( 48 ) — — 42,916 ( 48 )

government treasury securities 126,588 ( 296 ) — — 126,588 ( 296 )

government agency securities 12,560 ( 72 ) — — 12,560 ( 72 )

Total marketable securities $ 249,264 $ ( 493 ) $ — $ — $ 249,264 $ ( 493 )

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Given the Company's intent and ability to hold such securities until recovery, and the lack of significant change in credit risk of these investments, the Company does not consider these marketable securities to be impaired as of December 31, 2025 and 2024.

There were $ 0.1 million net unrealized losses on marketable securities for the year ended December 31, 2024.

For the years ended December 31, 2023 and 2022, there were $ 0.3 million and de minimis, respectively, net unrealized gains.

There were $ 0.7 million and $ 0.3 million net unrealized gains on marketable securities for the years ended December 31, 2025 and 2023, respectively, and $ 0.1 million net unrealized losses for the year ended

December 31, 2024.

There were no realized gains on marketable securities for the years ended December 31, 2025, 2024 and 2023.

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The Company did not have any property, plant, and equipment assets as of December 31, 2025 and 2024.

Depreciation and amortization expense for the years ended December 31, 2023 and 2022 was $ 0.7 million, and $ 1.4 million, respectively.

There was no depreciation and amortization expense for the year ended December 31, 2024.

Depreciation and amortization expense for the years ended December 31, 2023 was $ 0.7 million.

There was no depreciation and amortization expense for the year ended December 31, 2025 and 2024.

All of the Company’s long-lived assets were located in the United States.

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With respect to the Asset Acquisition, the Company determined that Aeglea was the acquirer for accounting purposes under ASC 805.

The primary factors considered were a) the relative voting rights in the combined entity not resulting in a change of control, b) legacy members of the Company's Board of Directors maintained control of the Board of Directors, and c) the only change in the composition of senior management

was the appointment of a new Chief Operating Officer.

Next, the Company considered whether the Asset Acquisition should be defined as a business under ASC 805.

ASC 805-10-55-5A through 55-5C describe a screen test to determine whether an acquired set of assets and activities is not a business.

We determined that substantially all (greater than 90%) of the fair value of the assets acquired were concentrated in a single asset, Spyre’s Option to license intellectual property rights related to SPY001, SPY002, SPY003 and SPY004 pursuant to the Paragon Agreement.

Accordingly, the Company treated the Asset Acquisition as an asset acquisition for accounting purposes.

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The Company concluded that the arrangement meets the definition of an asset acquisition rather than a business combination, as substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset, the Option to exclusively license IPR&D.

The Company determined that the Option to license IPR&D was a single asset as the Company's strategy relies on developing the entire portfolio of individual treatments to create combination treatments that simultaneously address different mechanisms of irritable bowel disease with a single treatment.

irritable bowel disease with a single treatment.

The Company also determined that the pipeline candidates within the portfolio are similar in nature and risk profile.

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As a result of the Asset Acquisition, the Company assumed the rights and obligations of Pre-Merger Spyre under the Paragon Agreement, including the Parapyre Option Obligation.

Pursuant to the Paragon Agreement, on a research program-by-research program basis following the finalization of the research plan for each respective research program, the Company is required to pay Paragon a nonrefundable fee in cash of $ 0.8 million.

Pursuant to the Paragon Agreement, on a research program-by-research program basis following the finalization of the research plan for

each respective research program, the Company is required to pay Paragon a nonrefundable fee in cash of $ 0.8 million.

In September 2023, the Company amended the Paragon Agreement to amend and restate certain terms of the option grant pertaining to the Parapyre Option Obligation, including but not limited to (i) defining that the annual equity grant of warrants is based on the outstanding shares of the Company’s common stock on a fully-diluted basis, (ii) establishing the grant date as the last business day of 2023 and 2024, and (iii) defining the term of the warrants granted as ten years .

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The Company recognizes the expense associated with each milestone when the achievement of the milestone is deemed probable.

During the years ended December 31, 2024, the Company recognized expense of $ 9.5 million related to Paragon license milestone payments recorded within Research and development expenses in the accompanying condensed statement of operations.

There was no such expense for the years ended December 31, 2023 and 2022.

For the year ended December 31, 2024, the Company made cash milestone payments to Paragon totaling $ 9.5 million.

There were no such payments for the years ended December 31, 2023 and 2022.

As of December 31, 2024, there were no Paragon license milestone payments outstanding and payable to Paragon.

Additionally, the Company recognized $ 0.7 million related to sublicensing fees and which was recorded as Research and development expenses in the accompanying statement of operations for the year ended December 31, 2024.

For the year ended December 31, 2024, the Company made sublicensing fees payments to Paragon totaling $ 0.2 million.

There were no such payments for the years ended December 31, 2023 and 2022.

As of December 31, 2024, $ 0.5 million in sublicensing fees were outstanding and payable to Paragon.

During the years ended December 31, 2025 and 2024, the Company recognized expense of $ 8.5 million and $ 9.5 million, respectively, related to Paragon license milestone payments recorded within Research and development expenses in the accompanying condensed statement of operations.

There was no such expense for the year ended December 31, 2023.

For the years ended December 31, 2025 and 2024, the Company made cash milestone payments to Paragon totaling $ 8.5 million and $ 9.5 million.

There were no such payments for the year ended December 31, 2023.

As of December 31, 2025 and 2024, there were no Paragon license milestone payments outstanding and payable to Paragon.

Additionally, the Company recognized $ 1.9 million and $ 0.7 million related to sublicensing fees and which was recorded as Research and development expenses in the accompanying statement of operations for the year ended December 31, 2025 and 2024, respectively.

There was no such expense for the year ended December 31, 2023.

For the year ended December 31, 2025 and 2024, the Company made sublicensing fees payments to Paragon totaling $ 2.4 million and $ 0.2 million.

There were no such payments for the year ended December 31, 2023.

As of December 31, 2025 and 2024, nil and $ 0.5 million in sublicensing fees were outstanding and payable to Paragon, respectively.

Related Party Transactions

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Fairmount appointed Paragon's board of directors and has the contractual right to approve the appointment of any executive officers of Paragon.

Parapyre is an entity formed by Paragon as a vehicle to hold equity in Spyre in order to share profits with certain employees of Paragon and will not perform any substantive role under the Paragon Agreement other than to receive warrants granted to Parapyre under the Paragon Agreement.

Parapyre is an entity formed by Paragon as a vehicle to hold equity in Spyre

in order to share profits with certain employees of Paragon and will not perform any substantive role under the Paragon Agreement other than to receive warrants granted to Parapyre under the Paragon Agreement.

The following is the summary of expenses related to the Paragon Agreement and License Agreements, which are ultimately settled in cash (in millions) and recorded within Research and development in the consolidated statement of operations for the periods presented:

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Please refer to Note 8 for additional information on the Paragon Agreement.

On July 12, 2023, December 14, 2023, and June 5, 2024, the Company exercised the Option available under the Paragon Agreement with respect to the SPY001, SPY002 and SPY003 research programs,

respectively.

Our Option available under the Paragon Agreement with respect to the SPY004 program remains unexercised.

On July 12, 2023, December 14, 2023, and June 5, 2024, the Company exercised the Option available under the Paragon Agreement with respect to the SPY001, SPY002 and SPY003 research programs, respectively.

The Option with respect to one additional program remains unexercised under the Paragon Agreement.

Please refer to Note 9 for additional information on the License Agreements related to the exercised options.

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provided, that Paragon receives rights to at least one SPY003 project antibody following completion of the SPY003 antibody selection process;

(d) obligating the Company to exercise its option to license the intellectual property rights to SPY003 project antibodies and technology following the completion of the SPY003 antibody selection process;

(d) obligating the Company to exercise its option to license the intellectual property rights to SPY003 project antibodies and technology following the completion of the SPY003 antibody selection

and (e) establishing a license agreement term sheet for the SPY003 research program with substantially similar milestone payment terms and royalty payment terms as the SPY001 License Agreement.

Please refer to Note 9 for additional disclosures.

For the years ended December 31, 2024 and 2023, the Company recognized expenses related to services provided by Paragon subsequent to the Asset Acquisition totaling $ 29.8 million and $ 48.5 million, which included $ 14.5 million and $ 11.4 million of stock-based compensation expense, respectively, and were recorded as Research and development expenses in the consolidated statements of operations.

For the years ended December 31, 2025, 2024 and 2023, the Company recognized expenses related to services provided by Paragon subsequent to the Asset Acquisition totaling $ 0.1 million and $ 29.8 million and $ 48.5 million, which included nil , $ 14.5 million and $ 11.4 million of stock-based compensation expense, respectively, and were recorded as Research and development expenses in the consolidated statements of operations.

I ncluded within the expenses recognized for services provided by Paragon for the year ended December 31, 2024, is a $ 5.9 million reduction in Research and development expenses related to the reimbursement of 50 % of the development costs for the SPY003 research program by Paragon.

For the years ended December 31, 2024 and December 31, 2023, the Company made payments totaling $ 31.8 million and $ 39.5 million, respectively, to Paragon .

There were no such payments for the year ended December 31, 2022.

For the years ended December 31, 2025, 2024 and 2023, the Company made payments totaling $ 0.2 million and $ 31.8 million and $ 39.5 million, respectively, to Paragon .

Parapyre Option Obligation

Pursuant to the Paragon Agreement, the Company agreed to issue Parapyre an annual equity grant of warrants, on the last business day of each of the years ended December 31, 2023 and December 31, 2024, to purchase 1 % of the then outstanding shares of the Company's common stock, on a fully diluted basis, during the term of the Paragon Agreement.

Pursuant to the Paragon Agreement, the Company issued Parapyre an annual equity grant of warrants, on the last business day of each of the years ended December 31, 2023 and December 31, 2024, to purchase 1 % of the then outstanding shares of the Company's common stock, on a fully diluted basis, during the term of the Paragon Agreement.

See Note 15 for disclosures related to the Parapyre Option Obligation.

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December 2023 PIPE

On December 11, 2023, the Company completed December 2023 PIPE.

The December 2023 PIPE Investors included Fairmount, a related party.

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McKenna and the Company are parties to a consulting agreement, pursuant to which Mr.

McKenna agreed to continue to provide consulting services as an independent contractor to the Company, with an effective date of August 1, 2023 (the

“Vesting Commencement Date”).

McKenna agreed to continue to provide consulting services as an independent contractor to the Company, with an effective date of August 1, 2023 (the “Vesting Commencement Date”).

As compensation for Mr.

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McKenna’s continued service to the Company through each applicable vesting date.

For the years ended December 31, 2024 and December 31, 2023, the Company recognized $ 1.1 million and $ 0.1 million, respectively, in stock-based compensation expense related to Mr.

For the years ended December 31, 2025, 2024 and 2023, the Company recognized $ 1.0 million, $ 1.1 million and $ 0.1 million, respectively, in stock-based compensation expense related to Mr.

McKenna's consulting agreement.

There was no such expense for the year ended December 31, 2022.

Prior to the Company's restructuring, as described in Note 17, the Company leased certain office space, laboratory facilities, and equipment.

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A tenant allowance of up to $ 1.0 million was provided by the lessor and fully reimbursed to the Company.

In August 2023, the Company terminated its building lease in Austin, Texas.

In August 2023, the Company terminated the Las Cimas Lease.

The negotiated termination agreement obligated the Company to pay the lessor a $ 2.0 million termination fee in exchange for releasing the Company of all further obligations under the lease including terminating the associated letter of credit.

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Total lease cost $ — $ — $ 926

Cash paid for amounts included in the measurement of operating lease liabilities during the years ended December 31, 2023 and 2022 was $ 0.5 million and $ 0.9 million, respectively, and was included within net cash used in operating activities in the cash flows.

As of December 31, 2024 and December 31, 2023, the Company had no operating or finance lease obligations.

Cash paid for amounts included in the measurement of operating lease liabilities during the years ended December 31, 2023 was $ 0.5 million, respectively, and was included within net cash used in operating activities in the cash flows.

There were no such payments for the years ended December 31, 2025 and 2024.

As of December 31, 2025 and 2024, the Company had no operating or finance lease obligations.

Convertible Preferred Stock and Stockholders’ Equity

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The common stock is not entitled to preemptive rights, and is not subject to conversion, redemption or sinking fund provisions.

of directors, in its discretion, determines to issue dividends and then only at the times and in the amounts that the board of directors may determine.

Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of common stock are entitled to receive dividends out of funds legally available if the board of directors, in its discretion, determines to issue dividends and then only at the times and in the amounts that the board of directors may determine.

As of December 31, 2025 and 2024, no common stock dividends had been declared by the board of directors.

Registered Direct Offering

In May 2022, the Company issued and sold 430,107 shares of common stock at an offering price of $ 40.00 per share and pre-funded warrants to purchase up to 694,892 shares of common ctock at an offering price of $ 39.9975 per warrant (representing the price per share of common stock sold in the offering minus the $ 0.0025 exercise price per warrant) in a registered direct offering pursuant to a shelf registration statement on Form S-3.

The net proceeds to the Company from this offering were approximately $ 42.9 million, after deducting placement agent fees and offering costs of $ 2.1 million.

June 2023 PIPE

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December 2023 PIPE

In December 2023, the Company issued and sold 6,000,000 shares of common stock at an offering price of $ 15.00 per share and 150,000 shares of Series B Preferred Stock at $ 600 per share through a private placement to a group of accredited investors.

placement to a group of accredited investors.

The net proceeds from this offering were approximately $ 169.1 million, after deducting placement agent fees and offering costs of $ 10.9 million.

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On September 6, 2024, the Company filed a new shelf registration statement on Form S-3 that was declared effective by the SEC for the potential offering, issuance and sale by the Company of up to $ 500.0 million of the Company's common stock, preferred stock, debt securities, warrants and/or units consisting of all or some of these securities.

Concurrent with the filing of the shelf-registration statement, the Company entered into a sales agreement (the "Sales Agreement") with TD Cowen, as its sales agent, pursuant to which the Company may issue and sell shares of its common stock for an aggregate offering price of up to $ 200.0 million under an ATM offering program included in the shelf registration.

During the twelve months ended December 31, 2024, the Company sold an aggregate of 777,432 shares of common stock under the ATM at an average price per share of $ 26.935 resulting in net proceeds of $ 20.5 million, after deducting sales agent commissions and other offering costs of $ 0.4 million.

Concurrent with the filing of the shelf-registration statement, the Company entered into the Sales Agreement, pursuant to which the Company may issue and sell shares of its common stock for an aggregate offering price of up to $ 200.0 million under an ATM offering program included in the shelf registration.

During the twelve months ended December 31, 2024, the Company sold an aggregate of 777,432 shares of common stock under the ATM offering program at an average price per share of $ 26.935 resulting in net proceeds of $ 20.5 million, after deducting sales agent commissions and other offering costs of $ 0.4 million.

As of February 12, 2026, $ 154.1 million remained available for sale under the Sales Agreement.

November 2024 Underwritten Offering

On November 18, 2024, the Company entered into the Underwriting Agreement with the Underwriters, pursuant to which the Company sold an aggregate of 8,366,250 shares of common stock, at a public offering

price per share of $ 27.50 , resulting in net proceeds of approximately $ 215.9 million, after deducting approximately $ 14.2 million of underwriting discounts and other offering costs.

On November 18, 2024, the Company entered into the November 2024 Underwriting Agreement with the November 2024 Underwriters, pursuant to which the Company sold an aggregate of 8,366,250 shares of common stock, inclusive of 1,091,250 shares pursuant to the full exercise of the underwriters' over-allotment option, at a public offering price per share of $ 27.50 , resulting in net proceeds of approximately $ 215.9 million after deducting approximately $ 14.2 million of underwriting discounts and other offering costs.

The November 2024 Offering closed on November 20, 2024 and the over-allotment option was exercised in full on November 26, 2024 and closed on November 29, 2024.

October 2025 Underwritten Offering

On October 13, 2025, the Company entered into the October 2025 Underwriting Agreement with the October 2025 Underwriters, pursuant to which the Company sold an aggregate of 17,094,594 shares of common stock, inclusive of 2,229,729 shares pursuant to the full exercise of the underwriters' over-allotment option, at a public offering price per share of $ 18.50 , resulting in net proceeds of approximately $ 296.4 million after deducting approximately $ 19.9 million of underwriting discounts and other offering costs.

The over-allotment option was exercised in full on October 14, 2025 and the transaction closed on October 15, 2025.

Parapyre Warrants

The Company settled its 2024 and 2023 obligations under the Parapyre Option Obligation by issuing Parapyre 848,184 and 684,407 warrants, respectively, to purchase the Company's common stock, at an exercise price per share per warrant of $ 23.28 and $ 21.52 , respectively.

The Company settled its 2024 and 2023 obligations under the Parapyre Option Obligation by issuing Parapyre 848,184 and 684,407 warrants, respectively, to purchase the Company's common stock, at an

exercise price per share per warrant of $ 23.28 and $ 21.52 , respectively.

As of December 31, 2025, none of the warrants issued under the Parapyre Option Obligation have been exercised.

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This exchange was recorded as a reclassification between Series A Preferred Stock and common stock based on the historical per-share contributed capital amount, inclusive of any forward-contract valuation adjustments, of the Series A Preferred Stock.

Following the April 2024 Exchange, 346,045 shares of Series A Preferred Stock remained outstanding.

The April 2024 Exchange closed on April 25, 2024, with 346,045 shares of Series A Preferred Stock remaining outstanding following closing.

Series B Non-Voting Convertible Preferred Stock

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Except as provided in the Series B Certificate of Designation or 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, alter or change adversely the powers, preferences or rights given to the Series B Preferred Stock, or alter or amend the Series B Certificate of Designation, amend or repeal any provision of, or add any provision to, the Company’s Certificate of Incorporation or its Bylaws, or file any articles of amendment, certificate of designations, preferences, limitations and relative rights of any series of preferred stock, if such action would adversely alter or change the preferences, rights, privileges or powers of, or restrictions provided

for the benefit of the Series B Preferred Stock, regardless of whether any of the foregoing actions will be by means of amendment to the Certificate of Incorporation or by merger, consolidation, recapitalization, reclassification, conversion or otherwise.

The Series B Preferred Stock does not have a preference upon any liquidation, dissolution or winding-up of the Company.

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As a result of the approval of the Series B Conversion Proposal, all conditions that could have required cash redemption of the Series B Preferred Stock were satisfied.

Since the Series B Preferred Stock is no longer redeemable, the associated balances of the Series B Preferred Stock were reclassified from mezzanine equity to permanent equity during the second quarter of 2024.

Since the Series B Preferred Stock were no longer redeemable, the associated balances of the Series B Preferred Stock were reclassified from mezzanine equity to permanent equity during the second quarter of 2024.

A total of 254,958 shares of Series B Preferred Stock automatically converted to 10,198,320 shares of common stock;

16,667 shares of Series B Preferred Stock did not automatically convert and remained outstanding as of December 31, 2025.

Following stockholder approval of the Series B Conversion Proposal, each share of Series B Preferred Stock will automatically convert into 40 shares of the Company's 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 (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.

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By entering into this agreement, the Company agreed to provide Immedica the following goods and services:

Deliver an exclusive, sublicensable, license and know-how (the “License”) to develop and commercialize pegzilarginase (the “Product”) in the territory comprising the members states of the European Economic Area, United Kingdom, Switzerland, Andorra, Monaco, San Marino, Vatican City, Turkey, Saudi Arabia, United Arab Emirates, Qatar, Kuwait, Bahrain, and Oman (the “Territory”);

Deliver an exclusive, sublicensable, license and know-how (the “License”) to develop and commercialize pegzilarginase (the “Product”) in the territory comprising the member states of the European Economic Area, United Kingdom, Switzerland, Andorra, Monaco, San Marino, Vatican City, Turkey, Saudi Arabia, United Arab Emirates, Qatar, Kuwait, Bahrain, and Oman (the “Territory”);

Complete the global pivotal PEACE (Pegzilarginase Effect on Arginase 1 Deficiency Clinical Endpoints) Phase 3 trial (“PEACE Trial”) and related Biologics License Application (“BLA”) package to file with the United States Food and Drug Administration (“FDA”), which will be leveraged by Immedica in obtaining the necessary regulatory approvals in the Territory;

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In July 2021, the Company modified the agreement with Immedica to provide certain additional services in relation to the PEACE Phase 3 Trial and BLA package performance obligation in exchange for the reimbursement of up to $ 3.0 million of the actual costs incurred in relation to such incremental services.

For the years ended December 31, 2023 and 2022, the Company recognized revenue of $ 0.9 million and $ 2.3 million, respectively, related to the PEACE Trial and BLA package performance obligation using a cost to cost model.

For the year ended December 31, 2023, the Company recognized revenue of $ 0.9 million related to the PEACE Trial and BLA package performance obligation using a cost to cost model.

On July 27, 2023, the Company announced that it had entered into an agreement to sell the global rights to pegzilarginase to Immedica for $ 15.0 million in upfront cash proceeds and up to $ 100.0 million in contingent milestone payments.

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The upfront payment and contingent milestone payments if paid, net of expenses and adjustments, will reduce the CVR liability and will be distributed to CVR holders pursuant to the CVR Agreement resulting from the Asset Acquisition.

During the twelve months ended December 31, 2025, the Company recognized a gain of $ 10.0 million within Gain on Sale of in-process research and development, for achieving certain reimbursement decision milestones during the period.

As of December 31, 2025, $ 3.0 million remains outstanding and reflected in Prepaid expenses and other current assets.

There was no similar gain during the twelve months ended or similar receivable as of December 31, 2024.

Contract Balances from Customer Contract

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2016 Equity Incentive Plan

In March 2015, the Company adopted the 2015 Equity Incentive Plan (“2015 Plan”), administered by the board of directors, and provides for the Company to sell or issue shares of common stock or restricted common stock, or to grant incentive stock options or nonqualified stock options for the purchase of common

stock, to employees, members of the board of directors and consultants of the Company.

Under the terms of the 2015 Plan, the exercise prices, vesting and other restrictions may be determined at the discretion of the board of directors, or their committee if so delegated, except that the exercise price per share of stock options may not be less than 100 % of the fair market value of the share of common stock on the date of grant, the term of stock options may not be greater than ten years for all grants, and for grantees holding more than 10 % of the total combined voting power of all classes of stock, the term may not be greater than five years .

The Company granted options under the 2015 Plan until April 2016 when it was terminated as to future awards, although it continues to govern the terms of options that remain outstanding under the 2015 Plan.

As of December 31, 2024, a total of 952 shares of common stock are subject to options outstanding under the 2015 Plan and will become available under the 2016 Equity Incentive Plan (as amended and restated, the “2016 Plan”), to the extent the options are forfeited or lapse unexercised.

2016 Equity Incentive Plan

The 2016 Plan became effective in April 2016 and serves as the successor to the 2015 Plan.

The 2016 Plan became effective in April 2016 and serves as the successor to the 2015 Equity Incentive Plan ("2015 Plan").

Under the 2016 Plan, the Company may grant stock options, stock appreciation rights, restricted stock awards, restricted stock units, performance awards, and stock bonuses.

The 2016 Plan provides for an initial reserve of 44,000 shares of common stock, plus 20,395 shares of common stock remaining under the 2015 Plan, and any share awards that subsequently are forfeited or lapse unexercised under the 2015 Plan.

The 2016 Plan

provides for an initial reserve of 44,000 shares of common stock, plus 20,395 shares of common stock remaining under the 2015 Plan, and any share awards that subsequently are forfeited or lapse unexercised under the 2015 Plan.

The shares reserved exclude shares of common stock reserved for issuance under the 2015 Plan.

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The 2018 Plan was amended to increase the number of shares of common stock reserved for issuance by 750,000 and 1,000,000 during the years ended December 31, 2025 and 2024, respectively.

As of December 31, 2025, the total number of shares reserved for issuance under the 2018 Plan was 7,460,440 , of which 6,620,097 shares were subject to outstanding awards.

Under the 2016 Plan and 2018 Plan, the Company may grant stock-based awards with service conditions (“service-based” awards), performance conditions (“performance-based” awards), and market conditions (“market-based” awards).

Service-based awards granted under the 2018 Plan, 2016 Plan, and 2015 Plan generally vest over four years and expire after ten years , although awards have been granted with vesting terms less than four years .

As of December 31, 2024, the total number of shares reserved for issuance under the 2018 Plan was 6,895,602 , of which 6,219,622 shares were subject to outstanding awards.

Spyre 2023 Equity Incentive Plan

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The acquisition-date fair value of these grants will be recognized as an expense on a pro-rata basis over the vesting period.

As of December 31, 2025, none of the stock options under the 2023 Plan remained outstanding.

Parapyre Option Obligation

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The Company settled its 2024 and 2023 obligations under the Parapyre Option Obligation by issuing Parapyre 848,184 and 684,407 warrants, respectively, to purchase the Company's common stock at an exercise price per share per warrant of $ 23.28 and $ 21.52 , respectively.

For the years ended December 31, 2024 and 2023, $ 14.5 million and $ 11.4 million, respectively, was recognized as stock compensation expense related to the Parapyre Option Obligation.

There was no similar expense for the years ended December 31, 2022.

As of December 31, 2024, the unamortized expense related to the Parapyre Option Obligation was nil .

There was no similar expense for the year ended December 31, 2025.

The following table summarizes stock option activity for the year ended December 31, 2025:

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There were no stock options issued to non-employees during the year ended December 31, 2025.

For the year ended December 31, 2024 139,187 non-employee stock options vested in the period.

There were no non-employee stock options vested during the years ended December 31, 2023 and 2022.

For the year ended December 31, 2025 and 2024, 119,250 and 139,187 non-employee stock options vested in the period, respectively.

There were no non-employee stock options vested during the years ended 2023.

2016 Employee Stock Purchase Plan

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The 2016 ESPP will terminate ten years from the first purchase date under the plan, unless terminated earlier by the board of directors.

In June 2018, the 2016 ESPP was amended to provide for an automatic annual increase in the number of shares reserved for issuance thereunder on January 1 of each year for the remaining term of the year equal to (a) 1.0 % of the number of issued and outstanding shares of common stock on December 31 of the immediately preceding year, or (b) a lesser amount as approved by the board of directors each year.

In June 2018, the 2016 ESPP was amended to provide for an automatic annual increase in the number of shares reserved for issuance thereunder (the "Evergreen Provision") on January 1 of each year for the remaining term of the year equal to (a) 1.0 % of the number of issued and outstanding shares of common stock on December 31 of the immediately preceding year, or (b) a lesser amount as approved by the board of directors each year.

As a result of the operation of this provision, on January 1, 2025, 2024 and 2023, an additional 602,570 , 360,571 , and 26,140 shares, respectively, became available for issuance under the 2016 ESPP.

As of December 31, 2025, the reserve remaining and available for future issuance under the 2016 ESPP was 972,775 shares.

In February 2023, the 2016 ESPP was amended to increase the maximum shares purchased during any one period from 80 shares to 400 shares or a lesser amount determined by the board of directors.

For the years ended December 31, 2024, 2023 and 2022, stock-based compensation expense related to the 2016 ESPP plan was $ 0.3 million , $ 0.1 million and $ 0.2 million, respectively.

In February 2023, the 2016 ESPP was amended to increase the maximum shares purchased during any one period (the "ESPP Limit") from 80 shares to 400 shares or a lesser amount determined by the board of directors and in January 2024, the 2016 ESPP was further amended to increase the ESPP Limit to 2,000 shares or a lesser amount determined by the Compensation Committee.

Effective January 1, 2026, the 2016 ESPP was amended and restated (as amended and restated, the "AR 2016 ESPP") to remove the Evergreen Provision, extend the term of the 2016 ESPP indefinitely and re-establish the offering periods, among other changes.

The Company plans to submit the AR 2016 ESPP for stockholder approval at its 2026 Annual Meeting of Stockholders.

For the years ended December 31, 2025 and 2024, stock-based compensation expense related to the 2016 ESPP plan was $ 0.3 million and $ 0.1 million for the year ended December 31, 2023.

Restricted Stock Units

The Company granted 153,865 service-based restricted stock units during the year ended December 31, 2023, of which 38,467 vested during the year ended December 31, 2024.

There were no restricted stock units granted during the years ended December 31, 2024 and 2022.

The following table summarizes employee restricted stock unit activity for the year ended December 31, 2025:

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Vested ( 38,466 ) 18.17

Forfeited — —

Unvested restricted stock units as of December 31, 2025 76,932 $ 18.17

There were no restricted stock units granted to non-employees during the years ended December 31, 2024, 2023, and 2022.

There were no restricted stock units granted during the year ended December 31, 2025.

Stock-Based Compensation Expense

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There was no such expense for the year ended December 31, 2025.

(2) Of the total $ 28.9 million, $ 14.2 million and $ 7.1 million of employee related stock-based compensation expense for the years ended December 31, 2024, 2023 and 2022, respectively, $ 3.6 million, $ 8.3 million and $ 6.9 million is related to legacy Aeglea employees and directors who no longer served the Company as of the end of the respective period.

(2) Of the total $ 36.6 million, $ 28.9 million and $ 14.2 million of employee related stock-based compensation expense for the years ended December 31, 2025, 2024 and 2023, respectively, nil , $ 3.6 million and $ 8.3 million is related to legacy Aeglea employees and directors who no longer served the Company as of the end of the respective period.

No related tax benefits were recognized for the years ended December 31, 2025, 2024, and 2023 (see Note 18).

The awards contain both performance and service-based vesting conditions.

No expense was recognized for the unvested awards with only a performance condition for the years ended December 31, 2024, 2023, and 2022.

The performance-based vesting conditions represent specific performance targets.

Compensation expense for share-based payment awards with performance conditions is recognized when the performance condition is deemed probable of achievement.

All outstanding awards as of December 31, 2025, under the 2016 Plan and 2018 Plan, have service-based vesting conditions only.

As of December 31, 2025, the Company had an aggregate of $ 81.3 million of unrecognized stock-based compensation expense for options outstanding, which is expected to be recognized over a weighted average period of 2.3 years.

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Expected Volatility

Since the Company was privately held through April 2016 and transitioned from a clinical stage company to a pre-clinical stage company in 2023, it alone does not have the relevant company-specific historical data to support its expected volatility.

The Company has limited relevant company-specific historical data to support its expected volatility since the Company's 2023 strategy and pipeline reset .

As such, the Company has used an average of expected volatilities based on the volatilities of a representative group of publicly traded biopharmaceutical companies over a period equal to the expected term of the stock option grants.

Subsequent to the Company’s initial public offering, it began to consider the Company’s own historic volatility.

However, due to the transition from a clinical stage company to a pre-clinical stage company, the Company still uses peer company data to assist in this analysis.

For purposes of identifying comparable companies, the Company selected companies with comparable characteristics to it, including enterprise value, risk profiles, position within the industry, and with historical share price information sufficient to meet the expected life of the stock-based awards.

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Total $ 6,448 $ 993 $ 931 $ 2,580 $ 10,952

As of December 31, 2024 and 2023, nil and $ 1.1 million of restructuring costs remained outstanding and unpaid, respectively, under the restructuring plan described above.

The following table summarizes the (loss) income before income tax expense by jurisdiction for the periods indicated:

The following table summarizes the (loss) income before income tax expense by jurisdiction for the periods indicated (in thousands):

Year Ended December 31,

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Loss before income tax expense $ ( 155,218 ) $ ( 207,967 ) $ ( 338,816 )

For the years ended December 31, 2024 and 2023, the Company recognized no provision or benefit from income taxes.

For the year ended December 31, 2022, the Company recognized an income tax expense of $ 0.1 million related to foreign subsidiaries income tax expense.

The difference between the Company’s provision for income taxes and the amounts computed by applying the statutory federal income tax rate to income before income taxes is as follows (in thousands):

The difference between the Company's provision for income taxes and the amounts computed by applying the statutory federal income tax rate to income before income taxes for the year ended December 31, 2025 is as follows (in thousands):

Year Ended December 31, 2025

Income taxes (benefit) at statutory federal rate $ ( 32,596 ) 21.00 %

State and local taxes, net of federal income tax effect — — %

Foreign tax effects

Other foreign ( 23 ) 0.01 %

Changes in valuation allowance 37,622 ( 24.24 ) %

Non-taxable or nondeductible items

Stock compensation 773 ( 0.50 ) %

Change in fair market value of contingent value right ( 6,251 ) 4.03 %

Limitation on officers' compensation 2,860 ( 1.84 ) %

Permanent and other items 114 ( 0.07 ) %

Other 10 ( 0.01 ) %

Stock based compensation - deferred only

( 2,524 ) 1.63 %

Provision / (benefit) for income taxes $ ( 15 ) 0.01 %

As disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the difference between the Company's provision for income taxes and the amounts computed by applying the statutory federal income tax rate to income before income taxes is as follows (in thousands):

Year Ended December 31,

Tax provision derived by applying the federal statutory rate to income before income taxes

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Federal tax credits ( 91 ) ( 1 )

State tax credits — — ( 640 )

Effect of tax rate on foreign jurisdiction ( 2 ) ( 53 )

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Income tax (benefit) expense $ 51 $ ( 26 )

The amounts of cash income taxes paid by the company are as follows:

Year Ended December 31, 2025

Foreign ( 15 )

Total $ ( 15 )

The components of the deferred tax assets and liabilities consist of the following (in thousands):

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Intangible assets 4,070 2,117 47

Deferred revenue — — 566

Accrued expense 1,625 1,047 579

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Unrealized gain ( 183 ) ( 92 ) —

Depreciable assets — — ( 676 )

Total deferred tax liabilities ( 183 ) ( 92 ) —

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Compensation $ 34,794 $ 21,780 $ 22,590

Share-based compensation (1)

Stock-based compensation (1)

37,614 44,833 25,675

Research and development, excluding compensation and share-based compensation (2) (3)

Research and development, excluding compensation and stock-based compensation (2) (3)

132,490 127,491 65,282

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Consolidated net loss $ 155,203 $ 208,018 $ 338,790

(1) Includes $ 15.6 million and $ 11.4 million in related party expenses for the years ended December 31, 2024 and 2023, respectively, and no related party expenses for the year ended December 31, 2022.

(1) Includes $ 1.0 million, $ 15.6 million and $ 11.5 million in related party expenses for the years ended December 31, 2025, 2024 and 2023, respectively.

(2) Includes non-clinical study expenses, clinical trial expenses and manufacturing costs.

(3) Includes $ 25.5 million and $ 37.1 million in related party expenses for the years ended December 31, 2024 and 2023, respectively, and no related party expenses for the year ended December 31, 2022.

(3) Includes $ 10.5 million, $ 25.5 million and $ 37.1 million in related party expenses for the years ended December 31, 2025, 2024 and 2023, respectively.

(4) Includes general and administrative expenses such as audit, legal, and other professional fees, interest income, and Other expense, net.

For the year ended December 31, 2025, includes a gain recognized in

connection with the sale of pegzilarginase to Immedica.

For the year ended December 31, 2023, includes acquired IPR&D expense related to the Asset Acquisition, a gain on sale related to sale of Pegzilarginase to Immedica, and changes in the forward-contract liability related to the Asset Acquisition.

(5) Includes a $ 29.8 million decrease, a $ 20.4 million increase and a $ 18.9 million increase in fair value of CVR liability for the years ended December 31, 2025, 2024 and 2023, respectively.

Net Loss Per Share

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Year Ended December 31, 2025

Series A Preferred Stock

Preferred Stock

Series A Preferred Stock Series B

Preferred Stock Common

Net loss per share, basic and diluted:

Allocation of losses $ ( 27,344 ) $ ( 1,317 ) $ ( 126,541 )

$ ( 47,624 ) $ ( 10,839 ) $ ( 149,555 )

Weighted-average shares outstanding 346,045 16,667 64,056,442

374,387 85,208 46,940,206

Weighted-average pre-funded warrants outstanding

Number of shares used in per share computation

374,387 85,208 47,027,638

Net loss per share, basic and diluted $ ( 79.02 ) $ ( 79.02 ) $ ( 1.98 )

$ ( 127.21 ) $ ( 127.21 ) $ ( 3.18 )

Year Ended December 31, 2024

Series A Preferred Stock

Preferred Stock

Series A Preferred Stock Series B

Preferred Stock Common

Net loss per share, basic and diluted:

Allocation of losses $ ( 47,624 ) $ ( 10,839 ) $ ( 149,555 )

$ ( 239,158 ) $ ( 4,749 ) $ ( 94,883 )

Weighted-average shares outstanding 374,387 85,208 46,940,206

434,612 8,630 6,201,954

Weighted-average pre-funded warrants outstanding — — 87,432

Number of shares used in per share computation 374,387 85,208 47,027,638

434,612 8,630 6,897,065

Net loss per share, basic and diluted $ ( 127.21 ) $ ( 127.21 ) $ ( 3.18 )

$ ( 550.28 ) $ ( 550.29 ) $ ( 13.76 )

Year Ended December 31, 2023

Series A Preferred Stock

Preferred Stock

Series A Preferred Stock Series B

Preferred Stock Common

Net loss per share, basic and diluted:

Allocation of losses $ ( 239,158 ) $ ( 4,749 ) $ ( 94,883 )

$ — $ — $ ( 83,815 )

Weighted-average shares outstanding 434,612 8,630 6,201,954

— — 2,307,668

Weighted-average pre-funded warrants outstanding — — 695,111

— — 1,063,563

Number of shares used in per share computation 434,612 8,630 6,897,065

— — 3,371,231

Net loss per share, basic and diluted $ ( 550.28 ) $ ( 550.29 ) $ ( 13.76 )

$ — $ — $ ( 24.86 )

The following weighted-average equity instruments were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented:

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data