Tyra Biosciences, Inc. 10-Q

Item 1 . Financial Statements Tyra Biosciences, Inc. Ba lance Sheets (in thousands, except share and par value data) March 31, December 31, 2022 2021 (unaudited) Assets Current assets: Cash and cash equivalents $ 292,499 $ 302,182 Prepaid and other current assets 1,526 1,875 Total current assets 294,025 304,057 Restricted cash 1,000 243 Property and equipment, net 1,008 1,027 Right-of-use asset 2,576 1,062 Other long-term assets 362 312 Total assets $ 298,971 $ 306,701 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable (including related party amounts of $ 69 and $ 47 , respectively) $ 1,356 $ 599 Lease liabilities, current 119 202 Accrued and other current liabilities 3,426 2,815 Total current liabilities 4,901 3,616 Lease liabilities, noncurrent 2,583 981 Other long-term liabilities 303 367 Total liabilities 7,787 4,964 Commitments and contingencies (Note 2) Stockholders’ equity: Preferred stock, $ 0.0001 par value; 50,000,000 shares authorized at March 31, 2022 and December 31, 2021, respectively; no shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively — — Common stock, $ 0.0001 par value; 500,000,000 shares authorized at March 31, 2022 and December 31, 2021, respectively; 42,565,134 and 42,536,183 shares issued at March 31, 2022 and December 31, 2021, respectively, and 41,696,564 and 41,441,135 shares outstanding at March 31, 2022 and December 31, 2021, respectively 4 4 Additional paid-in capital 346,377 342,104 Accumulated deficit ( 55,197 ) ( 40,371 ) Total stockholders’ equity 291,184 301,737 Total liabilities and stockholders’ equity $ 298,971 $ 306,701 See accompanying notes to unaudited financial statements. 2 Tyra Biosciences, Inc. Statements of Operations and Com prehensive Loss (unaudited) (in thousands, except share and per share data) Three Months Ended March 31, 2022 2021 Operating expenses: Research and development $ 9,645 $ 3,522 General and administrative (including related party amounts of $ 210 and $ 0 , respectively) 5,189 689 Total operating expenses 14,834 4,211 Loss from operations ( 14,834 ) ( 4,211 ) Other (expense) income: Interest income 18 2 Other expense ( 10 ) — Total other income 8 2 Net loss and comprehensive loss $ ( 14,826 ) $ ( 4,209 ) Net loss per share, basic and diluted $ ( 0.36 ) $ ( 2.09 ) Weighted-average shares used to compute net loss per share, basic and diluted 41,551,713 2,009,370 See accompanying notes to unaudited financial statements. 3 Tyra Biosciences, Inc. Statements of Convertible Pre ferred Stock and Stockholders’ Equity (Deficit) (unaudited) (in thousands, except share amounts) Series A Convertible Preferred Stock Series B Convertible Preferred Stock Common Stock Additional Paid-In Capital Accumulated Deficit Total Stockholders’ Equity (Deficit) Shares Amount Shares Amount Shares Amount Balance at December 31, 2020 3,374,560 $ 27,651 — $ — 1,829,377 $ — $ 439 $ ( 14,077 ) $ ( 13,638 ) Issuance of Series A convertible preferred stock, net of issuance costs 2,848,486 23,495 — — — — — — — Issuance of Series B convertible preferred stock, net of issuance costs — — 3,874,793 106,128 — — — — — Issuance of common stock under benefit plans — — — — 139,212 — 86 — 86 Vesting of shares of common stock subject to repurchase — — — — 234,239 — 65 — 65 Stock-based compensation — — — — — — 174 — 174 Net loss — — — — — — — ( 4,209 ) ( 4,209 ) Balance at March 31, 2021 6,223,046 $ 51,146 3,874,793 $ 106,128 2,202,828 $ — $ 764 $ ( 18,286 ) $ ( 17,522 ) Series A Convertible Preferred Stock Series B Convertible Preferred Stock Common Stock Additional Paid-In Capital Accumulated Deficit Total Stockholders’ Equity (Deficit) Shares Amount Shares Amount Shares Amount Balance at December 31, 2021 — $ — — $ — 41,441,135 $ 4 $ 342,104 $ ( 40,371 ) $ 301,737 Issuance of common stock under benefit plans — — — — 28,951 — 238 — 238 Vesting of shares of common stock subject to repurchase — — — — 226,478 — 63 — 63 Stock-based compensation — — — — — — 3,972 — 3,972 Net loss — — — — — — — ( 14,826 ) ( 14,826 ) Balance at March 31, 2022 — $ — — $ — 41,696,564 $ 4 $ 346,377 $ ( 55,197 ) $ 291,184 See accompanying notes to unaudited financial statements. 4 Tyra Biosciences, Inc. Statements of Cash Flows (unaudited) (in thousands) Three Months Ended March 31, 2022 2021 Cash flows from operating activities: Net loss $ ( 14,826 ) $ ( 4,209 ) Adjustments to reconcile net loss to net cash used in operations: Depreciation and amortization 64 22 Stock-based compensation 3,972 174 Loss on disposal of property and equipment 2 — Changes in operating assets and liabilities: Prepaid expenses and other assets 299 ( 91 ) Accounts payable, accrued expenses and other liabilities 1,560 ( 574 ) Right-of-use assets and lease liabilities, net 4 — Net cash used in operating activities ( 8,925 ) ( 4,678 ) Cash flows from investing activities: Purchases of property and equipment ( 239 ) ( 60 ) Net cash used in investing activities ( 239 ) ( 60 ) Cash flows from financing activities: Proceeds from the issuance of Series A convertible preferred stock, net of issuance costs — 23,495 Proceeds from the issuance of Series B convertible preferred stock, net of issuance costs — 106,128 Proceeds from issuances of common stock under benefit plans 238 533 Payments for financing lease — ( 4 ) Net cash provided by financing activities 238 130,152 Net cash (decrease) increase for the period ( 8,926 ) 125,414 Cash, cash equivalents and restricted cash at beginning of the period 302,425 15,467 Cash, cash equivalents and restricted cash at end of the period $ 293,499 $ 140,881 Reconciliation of cash, cash equivalents and restricted cash to the balance sheet Cash and cash equivalents $ 292,499 $ 140,638 Restricted cash 1,000 243 Total cash, cash equivalents and restricted cash $ 293,499 $ 140,881 Supplemental disclosure of cash flow information: Right-of-use asset obtained in exchange for lease liability $ 1,547 $ — Non-cash investing and financing activities: Purchases of equipment included in accounts payable 17 18 Deferred offering costs included in accounts payable and accrued expenses — 145 Series B issuance costs included in accounts payable and accrued expenses — 148 See accompanying notes to unaudited financial statements. 5 Tyra Biosciences, Inc. Notes to the Fi nancial Statements (unaudited) 1. Organization and Basis of Presentation Organization Tyra Biosciences, Inc. (the Company) was incorporated in the state of Delaware on August 2, 2018 . The Company is a precision oncology company designing and developing purpose-built therapies specifically designed to overcome therapy resistance and improve the lives of cancer patients whose tumors have acquired resistance over the course of therapy to currently available treatments. On September 17, 2021 , the Company completed its initial public offering (the IPO) and issued 12,420,000 shares of common stock for net proceeds of approximately $ 181.2 million. See Note 6 to these financial statements for additional details. Stock Split On September 7, 2021, the Company effected a 2.5974 -for-1 forward stock split of its common stock (the Forward Stock Split). The par value of the common stock was not adjusted as a result of the Forward Stock Split and the authorized shares were increased to 50,000,000 shares of common stock in connection with the Forward Stock Split. In conjunction with the Company’s IPO, the authorized shares of common stock were increased to 500,000,000 . The accompanying financial statements and notes to the financial statements give retroactive effect to the Forward Stock Split for all periods presented, unless otherwise indicated. Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles in the United States (GAAP). Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification (ASC) and Accounting Standards Updates (ASU) promulgated by the Financial Accounting Standards Board (FASB). The accompanying unaudited financial statements do not include all of the information and notes required by GAAP for complete financial statements. These unaudited financial statements include only normal and recurring adjustments that the Company believes are necessary to fairly state the Company’s financial position and the results of its operations and cash flows. The results for the three months ended March 31, 2022 and 2021 are not necessarily indicative of the results expected for the full fiscal year or any subsequent interim period. The balance sheet at March 31, 2022 has been derived from the financial statements at that date but does not include all disclosures required by GAAP for complete financial statements. Because all of the disclosures required by GAAP for complete financial statements are not included herein, these unaudited financial statements and the notes accompanying them should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Liquidity and Capital Resources From inception to March 31, 2022, the Company has devoted substantially all of its resources to organizing and staffing the company, business planning, raising capital, developing its proprietary SNÅP platform, undertaking research and development activities for its development programs, establishing its intellectual property portfolio, and providing general and administrative support for its operations. The Company has a limited operating history, has never generated any revenue, and the sales and income potential of its business is unproven. The Company has incurred net losses and negative cash flows from operating activities since its inception and expects to continue to incur net losses into the foreseeable future as it continues to develop its current and future product candidates. From inception through March 31, 2022, the Company funded its operations primarily through the issuance of common stock in its IPO, the sale of convertible preferred stock and the issuance of Simple Agreements for Future Equity (SAFEs). The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or amounts and classification of liabilities that may result from the outcome of this uncertainty. Management is required to perform a two-step analysis over the Company’s ability to continue as a going concern. Management must first evaluate whether there are conditions and events that raise substantial doubt about the Company’s ability to continue as a going concern (Step 1). If management concludes that substantial doubt is raised, management is also required to consider whether its plans alleviate that doubt (Step 2). Management believes that it has sufficient working capital on hand to fund operations through at least the next twelve months from the date these financial statements were available to be issued. There can be no assurance that the Company will be successful in 6 acquiring additional funding (if needed), that the Company’s projections of its future working capital needs will prove accurate, or that any additional funding would be sufficient to continue operations in future years. 2. Summary of Significant Accounting Policies During the three months ended March 31, 2022 , there have been no changes to our significant accounting policies as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 . Commitments and Contingencies The Company recognizes a liability with regard to loss contingencies when it believes it is probable a liability has been incurred, and the amount can be reasonably estimated. If some amount within a range of loss appears at the time to be a better estimate than any other amount within the range, the Company accrues that amount. When no amount within the range is a better estimate than any other amount the Company accrues the minimum amount in the range. The Company has no t recorded any such liabilities as of March 31, 2022 and December 31, 2021 . Related Parties Transactions between related parties are considered to be related party transactions even though they may not be given accounting recognition. FASB ASC 850, Related Party Disclosures (FASB ASC 850) requires that transactions with related parties that would make a difference in decision making shall be disclosed so that users of the financial statements can evaluate their significance. Related party transactions typically occur within the context of the following relationships: • Affiliates of the entity; • Entities for which investments in their equity securities is typically accounted for under the equity method by the investing entity; • Trusts for the benefit of employees; • Principal owners of the entity and members of their immediate families; • Management of the entity and members of their immediate families; • Other parties that can significantly influence the management or operating policies of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests. The Company previously entered into a consulting agreement with van den Boom & Associates, LLC (van den Boom & Associates), a professional services firm contracted to provide resources to assist with day-to-day accounting functions. Services provided under the agreement with van den Boom & Associates are billed at hourly rates. On April 16, 2021, Ms. van den Boom, the managing partner of van den Boom & Associates, entered into an employment agreement with the Company whereby she became its Chief Financial Officer. Van den Boom & Associates is considered a related party under FASB ASC 850 from the point in which Ms. van den Boom became a Company officer. For the three months ended March 31, 2022, van den Boom & Associates rendered contracted services totaling appro ximately $ 0.2 million. Recently Issued Accounting Pronouncements There were no other significant updates not already disclosed in the Company’s audited financial statements for the years ended December 31, 2021 and 2020 to the recently issued accounting standards for the three months ended March 31, 2022 . Although there are several other new accounting pronouncements issued or proposed by the FASB, the Company does not believe any of those accounting pronouncements have had or will have a material impact on its financial position or operating results. 7 3. Fair Value Measurements The accounting guidance defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1 —Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2 —Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. Level 3 —Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e. supported by little or no market activity). The carrying amounts of the Company’s financial instruments, including cash and cash equivalents, prepaid and other current assets, accounts payable, and accrued liabilities, approximate fair value due to their short maturities. Included in cash and cash equivalents at March 31, 2022 and December 31, 2021 are money market funds with a carrying value and fair value of $ 292.5 million and $ 302.2 million, r espectively, based upon a Level 1 fair value assessment. None of the Company’s non-financial assets or liabilities are recorded at fair value on a non-recurring basis. No transfers between levels have occurred during the periods presented. 4. Property and Equipment Property and equipment consisted of the following (in thousands): March 31, 2022 December 31, 2021 Equipment $ 873 $ 870 Computers and software 133 109 Leasehold improvements 156 141 Furniture and fixtures 79 76 1,241 1,196 Less: accumulated depreciation ( 233 ) ( 169 ) Total property and equipment, net $ 1,008 $ 1,027 The Company recognized $ 64,000 and $ 22,000 in depreciation expense for the three months ended March 31, 2022 and 2021, respectively . 5. Accrued and Other Current Liabilities Accrued and other current liabilities consisted of the following (in thousands): March 31, 2022 December 31, 2021 Accrued payroll and other employee benefits $ 1,004 $ 1,278 Accrued research and development 2,081 1,257 Accrued legal and professional fees 134 61 Accrued other general and administrative fees 207 219 Total accrued and other current liabilities $ 3,426 $ 2,815 8 6 . Stockholders' Equity Convertible Preferred Stock In January 2020 and February 2021, the Company issued, at each date, 2,848,486 shares of Series A convertible preferred stock at a price of $ 8.25 per share resulting in gross proceeds of $ 23.5 million, at each date, and incurred issuance costs of $ 0.2 million and $ 5,000 , respectively. In March 2021, the Company issued 3,874,793 shares of Series B convertible preferred stock, at a price of $ 27.4337 per share, resulting in net proceeds of $ 106.1 million excluding issuance costs of $ 0.2 million. In September 2021, upon completion of the IPO, all of the Company’s shares of convertible preferred stock converted into 26,228,089 shares of common stock. Common Stock Common stock reserved for future issuance consisted of the following: March 31, 2022 December 31, 2021 Common stock options granted and outstanding 3,844,194 3,771,516 Shares available for future issuance under the 2021 Incentive Award Plan 6,436,972 4,384,274 Shares available for future issuance under the 2021 Employee Stock Purchase Plan 777,844 380,000 Total common stock reserved for future issuance 11,059,010 8,535,790 Restricted Stock Since inception, the Company has issued 2,820,560 shares of restricted common stock at a price of $ 0.0001 per share to certain founders of the Company (Founders Stock). The Company maintains a repurchase right whereby the shares of Founders Stock are released from such repurchase right over a period of time of continued service by the recipient. Any shares subject to repurchase by the Company are not deemed, for accounting purposes, to be outstanding until those shares vest. Unvested outstanding Founders Stock as of March 31, 2022 and December 31, 2021 were 372,700 and 495,170 shares, respectively. The amount recorded as liabilities associated with shares issued with repurchase rights were immaterial as of March 31, 2022 and December 31, 2021. For the three months ended March 31, 2022 and 2021, 122,470 and 127,175 shares vested in each period and the Company recognized $ 0.1 million of stock-based compensation expense for each period related to the awards, respectively. As of March 31, 2022, the total unrecognized compensation expense related to unvested Founders Stock was $ 0.2 million and is expected to be recognized over a weighted-average period of approximately 0.8 years. 7. Equity Incentive Plans and Stock-Based Compensation Equity Incentive Plans In September 2021, the Company's Board of Directors adopted, and its stockholders approved, the 2021 Incentive Award Plan (the 2021 Plan). Upon the adoption of the 2021 Plan, the Company restricted the grant of future equity awards under the 2020 Plan. The 2021 Plan provides for the grants of stock options and other equity-based awards to employees, non-employee directors, and consultants of the Company. A total of 5,570,000 shares of the Company’s common stock were initially reserved for issuance pursuant to the 2021 Plan. The number of shares reserved under the 2021 Plan also included 1,032,150 shares of the Company’s common stock that remained available for issuance under the 2020 Plan as of immediately prior to the effectiveness of the 2021 Plan. The 2021 Plan share reserve will be increased by the number of shares under the 2020 Plan that are repurchased, forfeited, expired or cancelled after the effective date of the 2021 Plan. In addition, the number of shares of the Company’s common stock available for issuance under the 2021 Plan will automatically increase on the first day of each fiscal year, beginning with the Company’s 2022 fiscal year, in an amount equal to the lesser of (1) 5 % of the outstanding shares of the Company’s common stock on the last day of the immediately preceding fiscal year, or (2) such smaller amount as determined by the Company’s Board of Directors. 9 The options granted under the 2020 Plan and the 2021 Plan are exercisable at various dates as determined upon grant and will expire no more than ten years from their date of grant. The exercise price of each option shall be determined by the Company’s Board of Directors based on the fair market value of the Company’s stock on the date of the option grant. The exercise price shall not be less than 100% of the fair market value of the Company’s common stock at the time the option is granted. Most option grants generally vest 25 % on the first anniversary of the original vesting commencement date, with the balance vesting monthly over the remaining three years and early exercise is permitted. The vesting period generally occurs over four years unless there is a specific performance vesting trigger at which time those shares will vest when the performance trigger is probable to occur. A summary of the Company’s stock option activity for the period ended March 31, 2022 is as follows: Options Weighted-Average Exercise Price per Share Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2021 3,771,516 $ 9.18 9.3 $ 28,901 Granted 190,487 $ 11.55 Exercised ( 1,433 ) $ 2.22 Forfeited ( 116,376 ) $ 14.66 Outstanding at March 31, 2022 3,844,194 $ 8.95 8.7 $ 19,938 Exercisable at March 31, 2022 891,348 $ 5.79 7.1 $ 5,926 Vested and expected to vest as of March 31, 2022 3,844,194 $ 8.95 8.7 $ 19,938 As of March 31, 2022, 184,214 performance-based stock options were both outstanding and unvested, with total unrecognized stock-based compensation expense of $ 0.8 million. The achievement of the performance conditions for these options was deemed probable to occur as of March 31, 2022, therefore the Company recognized $ 1.5 million in expense over the requisite service period related to these awards for the three months ended March 31, 2022. Stock-Based Compensation Expense The Company estimated the fair value of stock options using the Black-Scholes valuation model. The Company accounts for any forfeitures of options when they occur. Previously recognized compensation expense for an award is reversed in the period that the award is forfeited. The fair value of stock options was estimated using the following assumptions: Three Months Ended March 31, 2022 2021 Stock Options: Stock price $ 10.96 - 12.31 $ 0.99 - 2.24 Risk-free rate of interest 1.6 - 2.0 % 0.8 - 1.0 % Expected term (years) 6.0 - 6.1 6.0 - 6.1 Expected stock price volatility 86.4 - 90.4 % 99.7 - 99.9 % Dividend yield — — Stock-based compensation expense recognized for all equity awards, including Founder's Stock, has been reported in the statements of operations and comprehensive loss as follows (in thousands): Three Months Ended March 31, 2022 2021 Research and development expense $ 1,478 $ 79 General and administrative expense 2,494 95 Total $ 3,972 $ 174 The weighted-average grant date fair value of employee option grants for the three months ended March 31, 2022 and 2021 was $ 8.52 and $ 1.76 per share, respecti vely. 10 As of March 31, 2022, the unrecognized compensation cost related to outstanding employee and nonemployee options was $ 20.4 million, and is expected to be recognized as expense over a weighted-average period of approximately 2.5 years. Employee Stock Purchase Plan In September 2021, the Company’s Board of Directors approved and adopted the 2021 Employee Stock Purchase Plan (ESPP). The ESPP became effective on the business day immediately prior to the effective date of the Company’s first registration statement. A total of 380,000 shares of the Company’s common stock were initially reserved for issuance pursuant to the ESPP. In addition, the number of shares of the Company’s common stock available for issuance under the ESPP will automatically increase on the first day of each fiscal year, beginning with the Company’s 2022 fiscal year, in an amount equal to the lesser of (1) 1 % of the outstanding shares of the Company’s common stock on the last day of the immediately preceding fiscal year, or (2) such smaller amount as determined by the Company’s Board of Directors. The ESPP permits eligible employees who elect to participate in an offering under the ESPP to have up to 15 % of their eligible earnings withheld, subject to certain limitations, to purchase shares of common stock pursuant to the ESPP. The price of common stock purchased under the ESPP is equal to 85 % of the lower of the fair market value of the common stock at the commencement date of each offering period or the relevant date of purchase. Each offering period is six months, with new offering periods commencing every six months on or about the dates of March 15 and September 15 of each year . During the three months ended March 31, 2022, the Company issued 27,518 shares of common stock in connection with the ESPP. Liability for Early Exercise of Stock Options Certain individuals were granted the ability to early exercise their stock options prior to the IPO. The shares of common stock issued from the early exercise of unvested stock options are restricted and continue to vest in accordance with the original vesting schedule. The Company has the option to repurchase any unvested shares at the original purchase price upon any voluntary or involuntary termination. The shares purchased by the employees and non-employees pursuant to the early exercise of stock options are not deemed, for accounting purposes, to be outstanding until those shares vest. The cash received in exchange for exercised and unvested shares related to stoc k options granted is recorded as a liability for the early exercise of stock options on the accompanying balance sheets and will be transferred into common stock and additional paid-in capital as the shares vest. As of March 31, 2022 and December 31, 2021, 495,870 and 599,878 unvested shares issued under early exercise provisions were subject to repurchase by the Company, respectively. As of March 31, 2022 and December 31, 2021, the Company recorded $ 0.3 million and $ $ 0.4 million, respectively, associated with shares issued with repurchase rights in other long-term liabilities. 8. Net Loss Per Share The following table sets forth the computation of the basic and diluted net loss per share (in thousands, except share and per share amounts): Three Months Ended March 31, 2022 2021 Numerator: Net loss $ ( 14,826 ) $ ( 4,209 ) Denominator: Weighted average shares used to compute net loss per common share, basic and diluted 41,551,713 2,009,370 Net loss per share, basic and diluted $ ( 0.36 ) $ ( 2.09 ) The following table sets forth the outstanding potentially dilutive securities that have been excluded in the calculation of diluted net loss per share because their inclusion would be anti-dilutive. As of March 31, 2022 2021 Unvested restricted common stock subject to repurchase 372,700 864,007 Unvested common stock upon early exercise of stock options 495,870 818,700 Options to purchase common stock 3,844,194 865,032 4,712,764 2,547,739 11 9. Leases The Company has leases for its office and laboratory space, including its corporate headquarters, with terms that expire in 2033. The Company has two options to extend the term of the operating lease for a period of three years each . However, as the Company was not reasonably certain to exercise either of those options at lease commencement, neither option was recognized as part of the associated operating lease Right of Use (ROU) asset or liability. In March 2022, the Company entered into an agreement (the Expansion Lease), for an additional office and laboratory space. The Expansion Lease is expected to commence in the second quarter of 2023 and projected lease payments over the life of the lease are expected to be $ 5.5 million with a lease expiration of 120 months after the commencement of the Expansion Lease. The Company has an option to renew the Expansion Lease and its existing operating lease, which has the same lessor and has been amended to have the same lease term as the Expansion Lease for two additional thirty-six month periods In connection with the Company's operating leases, the Company paid a security deposit of $ 71,000 and is required to maintain a letter of credit of $ 1.0 million until 2027 at which time it can be reduced to $ 0.5 million throughout the end of the lease term. The Company's operating lease cost was $ 0.1 million and $ 0.0 million for the three months ended March 31, 2022 and 2021, respectively. Cash paid for amounts included in the measurement of lease liabilities was $ 0.1 million and $ 0.1 million for the three months ended March 31, 2022 and 2021, respectively. Maturities of lease liabilities, weighted-average remaining term and weighted-average discount rate were as follows (in thousands): As of March 31, Year ending December 31, 2022 (remaining nine months) $ 219 2023 299 2024 308 2025 317 2026 327 Thereafter 2,378 Total minimum lease payments 3,848 Less: amount representing interest ( 1,146 ) Present value of lease liabilities 2,702 Less: current portion of lease liabilities ( 119 ) Lease liabilities, noncurrent $ 2,583 March 31, December 31, 2022 2021 Weighted-average remaining lease term (years) - operating leases 11.3 4.6 Weighted-average incremental borrowing rate - operating leases 6.50 % 7.50 % 12 Item 2 . Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis and the unaudited interim financial statements included in this Quarterly Report on Form 10-Q should be read in conjunction with the financial statements and notes thereto for the year ended December 31, 2021 and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations, both of which are contained in the Annual Report on Form 10-K for the year ended December 31, 2021 (the 2021 Annual Report). Forward-Looking Statements This Quarterly Report on Form 10-Q (Quarterly Report) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). All statements other than statements of historical facts contained in this Quarterly Report, including statements regarding our future results of operations and financial position, business strategy, research and development plans, the anticipated timing, costs, design and conduct of our ongoing and planned preclinical studies and planned clinical trials for our product candidates, the timing and likelihood of regulatory filings and approvals for our product candidates, our ability to commercialize our product candidates, if approved, the impact of the COVID-19 pandemic on our business, plans and objectives of management for future operations and future results of anticipated product development efforts, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “contemplate,” “continue” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target” “will” or “would” or the negative of these terms or other similar expressions. The forward-looking statements in this Quarterly Report are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this Quarterly Report and are subject to a number of risks, uncertainties and assumptions, including, without limitation, the risk factors described in Part II, Item 1A, “Risk Factors” of this Quarterly Report. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Overview We are a precision oncology company focused on developing purpose-built therapies to overcome tumor resistance and improve outcomes for patients with cancer. We are using our proprietary SNÅP platform, which is optimized to enable rapid and precise refinement of structural design through iterative molecular SNÅPshots, in order to generate next-generation product candidates that are specifically designed to address acquired drug resistance and provide alternative treatment options. We are initially focused on developing a pipeline of selective inhibitors of the Fibroblast Growth Factor Receptor (FGFR) family members, which are altered in approximately 7% of all cancers. We are advancing multiple product candidates toward the clinic including our lead product candidate TYRA-300, an FGFR3 inhibitor with an initial focus on patients with metastatic urothelial carcinoma of the bladder and urinary tract. Our second product candidate, TYRA-200, is an FGFR2 inhibitor with an initial focus on patients with i ntrahepatic cholangiocarcinoma who have developed drug resistance mutations to existing FGFR inhibitors due to activating mutations and gene alterations in FGFR2. We anticipate submitting an Investigational New Drug application (IND) with the U.S. Food and Drug Administration (FDA) for TYRA-300 in mid-2022 and for TYRA-200 in the second half of 2022. In addition, we have pipeline development programs targeting FGFR3-related achondroplasia and other FGFR3-related skeletal dysplasias, REarranged during Transfection kinase (RET), and FGFR4-related cancers. Since the commencement of our operations in 2018, we have devoted substantially all of our resources to organizing and staffing the company, business planning, raising capital, developing our proprietary SNÅP platform, undertaking research and development activities for our development programs, establishing our intellectual property portfolio, and providing general and administrative support for our operations. We have not generated any revenue to date and have funded our operations primarily from our initial public offering (IPO), private placements of our convertible preferred stock, and the issuance of Simple Agreement for Future Equity. Our net losses for the three months ended March 31, 2022 and 2021 were $14.8 million and $4.2 million , respectively. As of March 31, 2022, we had an accumulated deficit of $55.2 million. As of March 31, 2022, we had cash and cash equivalent s of $292.5 million . 13 We have incurred significant operating losses since inception. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical development activities, other research and development activities and capital expenditures. We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future particularly if and as we conduct preclinical studies and planned clinical trials, continue our research and development activities, utilize third parties to manufacture our product candidates and related raw materials, hire additional personnel, expand and protect our intellectual property, and incur additional costs associated with being a public company. Based on our current operating plan, we believe that our existing cash and cash equivalents will be sufficient to fund our operating expenses and capital expenditures through at least 2024. We have never generated any revenue and do not expect to generate any revenues from product sales unless and until we successfully complete development of and obtain regulatory approval for our product candidates, which will not be for several years, if ever. In addition, if we obtain regulatory approval for any of our product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution. Accordingly, until such time as we can generate significant revenue from sales of our product candidates, if ever, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements. However, we may not be able to raise additional funds or enter into such other arrangements when needed or on favorable terms, or at all. If we are unable to raise additional capital or enter into such arrangements when needed, we could be forced to delay, limit, reduce or terminate our research and development programs or future commercialization efforts, or grant rights to develop and market our product candidates even if we would otherwise prefer to develop and market such product candidates ourselves. The global COVID-19 pandemic continues to evolve, and we will continue to monitor the COVID-19 situation closely. The extent of the impact of the COVID-19 pandemic on our business, operations and development timelines and plans remains uncertain, and will depend on certain developments, including the duration and spread of the pandemic and its impact on our development activities, contract research organizations (CROs), third-party manufacturers and other third parties with whom we do business, as well as its impact on regulatory authorities and our key scientific and management personnel. Components of Results of Operations Operating Expenses Research and Development Expenses To date, our research and development expenses consist primarily of external and internal costs related to the development of our SNÅP platform and our product candidates and development programs. Our research and development expenses primarily include: • external costs, including: • expenses incurred in connection with the discovery and preclinical development of our product candidates, including under agreements with third parties, such as consultants and CROs; • costs associated with consultants for chemistry, manufacturing and controls, or CMC development, and other services; and • the cost of manufacturing compounds for use in our preclinical studies, including under agreements with third parties, such as consultants and third-party manufacturers; and • internal costs, including: • employee-related expenses, including salaries, related benefits, travel and share-based compensation expenses for employees engaged in research and development functions; • the costs of laboratory supplies and acquiring, developing and manufacturing preclinical study materials; and • facilities, depreciation and other expenses, which include allocated expenses for rent and maintenance of facilities, and supplies. 14 We expense research and development expenses in the periods in which they are incurred. External expenses are recognized based on an evaluation of the progress to completion of specific tasks using information provided to us by our service providers or our estimate of the level of service that has been performed at each reporting date. We track external expenses on a development program and other program specific basis. However, we do not track internal costs on a program specific basis because these costs primarily relate to compensation, early research and consumable costs, which are deployed across multiple programs under development. Research and development activities are central to our business model. There are numerous factors associated with the successful development of any of our product candidates, including future trial design and various regulatory requirements, many of which cannot be determined with accuracy at this time based on our stage of development. In addition, future regulatory factors beyond our control may impact our clinical development programs. Product candidates in later stages of development generally have higher development costs than those in earlier stages of development. As a result, we expect that our research and development expenses will increase substantially over the next several years as we advance our product candidates through preclinical studies into and through clinical trials, continue to discover and develop additional product candidates and expand our pipeline, maintain, expand, protect and enforce our intellectual property portfolio, and hire additional personnel. Our future research and development expenses may vary significantly based on a wide variety of factors such as: • the number and scope, rate of progress, expense and results of our discovery and preclinical development activities and clinical trials; • the number of trials required for approval; • the number of sites included in the trials; • the countries in which the trials are conducted; • the length of time required to enroll eligible patients; • the number of patients that participate in the trials; • the number of doses that patients receive; • the drop-out or discontinuation rates of patients; • potential additional safety monitoring requested by regulatory agencies; • the duration of patient participation in the trials and follow-up; • the phase of development of the product candidate; • the efficacy and safety profile of the product candidate; • the timing, receipt, and terms of any approvals from applicable regulatory authorities including the FDA and non-U.S. regulators; • maintaining a continued acceptable safety profile of our product candidates following approval, if any; • the cost and timing of manufacturing our product candidates; • significant and changing government regulation and regulatory guidance; • the impact of any business interruptions to our operations or to those of the third parties with whom we work, particularly in light of the COVID-19 pandemic environment; and • the extent to which we establish additional strategic collaborations or other arrangements. 15 A change in the outcome of any of these variables with respect to the development of any of our product candidates could significantly change the costs and timing associated with the development of that product candidate. The process of conducting the necessary preclinical and clinical research to obtain regulatory approval is costly and time-consuming. The actual probability of success for our product candidates or any future candidates may be affected by a variety of factors. We may never succeed in achieving regulatory approval for any of our product candidates or any future candidates. General and Administrative Expenses General and administrative expenses consist primarily of personnel-related expenses, including employee salaries, bonuses, benefits, and stock-based compensation charges, for personnel in executive and administrative functions. Other significant general and administrative expenses include legal fees relating to intellectual property and corporate matters, professional fees for accounting, tax and consulting services and insurance costs. We expect our general and administrative expenses will increase for the foreseeable future to support our increased research and development activities, manufacturing activities, and the increased costs associated with operating as a public company. These increased costs will likely include increased expenses related to hiring of additional personnel, audit, legal, regulatory and tax-related services associated with maintaining compliance with exchange listing and SEC, requirements, director and officer insurance costs, and investor and public relations costs. Results of Operations Comparison of the Three Months Ended March 31, 2022 and 2021 The following table summarizes our results of operations for the periods indicated (in thousands): Three Months Ended March 31, 2022 2021 Change Operating expenses: Research and development $ 9,645 $ 3,522 $ 6,123 General and administrative 5,189 689 4,500 Total operating expenses 14,834 4,211 10,623 Loss from operations (14,834 ) (4,211 ) (10,623 ) Other (expense) income: Interest income 18 2 16 Other expense (10 ) — (10 ) Total other income 8 2 6 Net loss and comprehensive loss $ (14,826 ) $ (4,209 ) $ (10,617 ) 16 Research and Development Expenses Research and development expenses were $9.6 million and $3.5 million for the three months ended March 31, 2022 and 2021, respectively. The increase of $6.1 million was primarily due to additional spend to support the advancement of our TYRA-300, TYRA-200 and our SNÅP platform , including $2.8 million of higher personnel-related costs, including $1.4 million of non-cash stock-based compensation costs. The following table summarizes our research and development expenses by development program for the three months ended March 31, 2022 and 2021 (in thousands): Three Months Ended March 31, 2022 2021 External research and development expense by program TYRA-300 $ 2,292 $ 1,340 TYRA-200 1,007 556 FGFR3 ACH 570 — RET 1,466 374 FGFR4 486 124 Other development programs 121 — Unallocated research and development expense Other research and development 599 208 Personnel-related expenses 1,626 841 Stock-based compensation 1,478 79 Total research and development expense $ 9,645 $ 3,522 General and Administrative Expenses General and administrative expenses were $5.2 million and $0.7 million for the three months ended March 31, 2022 and 2021, respectively. The increase of $4.5 million was primarily due to increa ses of $3.3 million in personnel-related expenses, including $2.4 million in non-cash stock-based compensation costs, $0.6 million in professional services related to legal, accounting, and other consulting fees and $0.6 million in other operating expenses. Liquidity and Capital Resources Sources of Liquidity On September 17, 2021, we completed our IPO and issued 12,420,000 shares of common stock for net proceeds of approximately $181.2 million. Prior to our initial public offering, we funded our operations primarily through private placements of our convertible preferred stock with aggregate gross proceeds of $157.2 million. Our primary uses of cash to date have been to fund our research and development activities, including with respect to TYRA-300 and TYRA-200 and other research programs, business planning, establishing and maintaining our intellectual property portfolio, hiring personnel, raising capital, and providing general and administrative support for these operations. Cash Flows The following table sets forth a summary of our cash flows for the periods indicated (in thousands): Three Months Ended March 31, 2022 2021 Net cash used in operating activities $ (8,925 ) $ (4,678 ) Net cash used in investing activities (239 ) (60 ) Net cash provided by financing activities 238 130,152 Net cash (decrease) increase for the period $ (8,926 ) $ 125,414 17 Operating Activities Net cash used in operating activities for the three months ended March 31, 2022 was $8.9 million, consisting primarily of our net loss of $14.8 million, adjusted for $4.0 million of non-cash charges related to stock-based compensation expense and $1.9.0 million for net changes in operating assets and liabilities. Net cash used in operating activities for the three months ended March 31, 2021 wa s $4.7 million, consisting primarily of our net loss of $4.2 million and $0.7 million for net changes in operating assets and liabilities, partially offset by $0.2 million of non-cash charges related to stock-based compensation expense. Investing Activities Net cash used in investing activities for the three months ended March 31, 2022 and 2021 was $0.2 million and $0.1 million, respec tively, consisting of purchases of property and equipment. Financing Activities Net cash provided by financing activities was $0.2 million for the three months ended March 31, 2022 and was primarily related to $0.2 million from proceeds received from the issuance of common stock under benefit plans. Net cash provided by financing activities was $130.2 million for the three months ended March 31, 2021, primarily related to net proceeds of $23.5 million from the second closing of our Series A convertible preferred stock, $106.1 million in net proceeds from the issuance of our Series B convertible preferred stock, and $0.6 million from proceeds received from the issuance of common stock under equity plans. Future Funding Requirements Based on our current operating plan, we believe that our existing cash and cash equivalents will be sufficient to meet our anticipated operating expenses and capital expenditures through at least 2024. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. We have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we expect. Additionally, the process of conducting preclinical studies and testing product candidates in clinical trials is costly, and the timing of progress and expenses in these studies and trials is uncertain. Our future capital requirements will depend on many factors, including: • the initiation, type, number, scope, results, costs and timing of, our ongoing and planned preclinical studies and clinical trials of existing product candidates or clinical trials of other potential product candidates we may choose to pursue in the future, including based on feedback received from regulatory authorities; • the costs and timing of manufacturing for current or future product candidates, including commercial scale manufacturing if any product candidate is approved; • the costs, timing and outcome of regulatory review of current or future product candidates; • the costs of obtaining, maintaining and enforcing our patents and other intellectual property rights; • our efforts to enhance operational systems and hire additional personnel to satisfy our obligations as a public company, including enhanced internal controls over financial reporting; • the costs associated with hiring additional personnel and consultants as our business grows, including additional executive officers and clinical development personnel; • the costs and timing of establishing or securing sales and marketing capabilities if any current or future product candidate is approved; • our ability to achieve sufficient market acceptance, coverage and adequate reimbursement from third-party payors and adequate market share and revenue for any approved products; 18 • costs associated with any products or technologies that we may in-license or acquire; and • delays or issues with any of the above, including the risk of each of which may be exacerbated by the ongoing COVID-19 pandemic. Until such time, if ever, as we can generate substantial product revenues to support our cost structure, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders could be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt financing and equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise funds through collaborations, or other similar arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us and/or may reduce the value of our common stock. If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market our product candidates even if we would otherwise prefer to develop and market such product candidates ourselves. Contractual Obligations and Commitments Other than disclosed below, there were no material changes outside the ordinary course of our business during the three months ended March 31, 2022 to the information regarding our contractual obligations that was disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the 2021 Annual Report. The following table summarizes our contractual obligations and commitments as of March 31, 2022 (in thousands): Payments Due by Period Total Remainder of 2022 2023-2024 2025-2026 Thereafter Operating lease obligations $ 3,848 $ 219 $ 607 $ 644 $ 2,378 Critical Accounting Policies and Estimates There have been no material changes to our critical accounting policies and estimates during the three months ended March 31, 2022, as compared to the critical accounting policies and estimates disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the 2021 Annual Report. Recently Adopted Accounting Pronouncements See Note 2 to our financial statements included elsewhere in this Quarterly Report on Form 10-Q for recently issued accounting pronouncements that may potentially impact our financial position and results of operations.