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Item 7. Management’s Discussion and Analysis

2025-03-28 compared with 2024-03-13 · 159 added, 138 removed, 206 unchanged (59% of the section changed)

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Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

References in the following discussion to “ we, ” “ our, ” “ us, ” or “ Aadi ” refer to Aadi Bioscience, Inc.

References in the following discussion to “ we, ” “ our, ” “ us, ” or “ Whitehawk” refer to Whitehawk Therapeutics, Inc.

and its subsidiaries.

Throughout this document we refer to FYARRO (nab-sirolimus, sirolimus protein-bound particles for injectable suspension (albumin-bound)) as FYARRO in the context of commercialization for the treatment of advanced malignant perivascular epithelioid cell tumor (PEComa), investigational use, our clinical trials, regulatory matters such as orphan drug designation, our license agreement with Bristol-Myers Squibb Company and collaboration agreement with Mirati Therapeutics, Inc., all further discussed throughout this document.

We are a biopharmaceutical company focused on developing and commercializing precision therapies for cancers with alterations in the mTOR pathway, a key regulator of cell growth and cancer progression.

Our lead drug product, FYARRO ® (sirolimus protein-bound particles for injectable suspension (albumin-bound);

nab -sirolimus), combines two established technologies — nanoparticle albumin-bound ( nab ) technology and the anti-cancer agent, sirolimus.

Nab -sirolimus is a potent inhibitor of the mTOR biological pathway with demonstrated anti-cancer activity in our lead indication, advanced unresectable or metastatic malignant perivascular epithelioid cell tumor (“PEComa”), a rare cancer.

We believe our approach to utilizing this novel combination of technologies has the potential to produce transformational therapies for patients with cancers beyond PEComa that have known mTOR pathway activation and/or cancers in which other mTOR inhibitors have not been fully exploited due to problems of pharmacology, effective drug delivery, safety, or effective targeting to the disease site.

In November 2021, the U.S.

Food and Drug Administration (the “FDA”) approved FYARRO sirolimus protein-bound particles for injectable suspension (albumin-bound) for the treatment of adult patients with locally advanced unresectable or metastatic malignant PEComa.

Throughout this document we refer to FYARRO (nab-sirolimus, sirolimus protein-bound particles for injectable suspension (albumin-bound)) as FYARRO in the context of commercialization for the treatment of advanced malignant perivascular epithelioid cell tumor (PEComa), investigational use, our clinical trials, regulatory matters such as orphan drug designation, and our former agreements with Bristol-Myers Squibb Company, Mirati Therapeutics, Inc.

and EOC Pharma (Hong Kong) Limited, all further discussed throughout this document.

We are an oncology therapeutics company applying advanced technologies to established tumor biology that are intended to efficiently deliver improved cancer treatments.

We have deep experience in chemistry, formulation, and drug delivery, as well as research, clinical, and commercial pharmaceutical development, successfully taking product candidates from the clinic to approval, launch, and commercialization.

License Agreement and ADC Therapies

We recently entered into an intellectual property license agreement (the “License Agreement”) with WuXi Biologics (Shanghai FX) Co., Ltd.

(“WuXi Biologics”) for the development and global commercialization of a portfolio of three next generation antibody drug conjugates (“ADCs”) targeting clinically validated, broadly overexpressed tumor antigens in high potential cancer indications with significant unmet need.

These ADCs are constructed utilizing an advanced linker-payload platform called CPT113 that has been shown to provide high stability in blood circulation and deliver targeted release of a Topoisomerase I (“TOPO1”) inhibitor payload into cancer cells.

These in-licensed assets originated through the collaborative efforts of WuXi Biologics, a leading global contract research, development and manufacturing organization (“CRDMO”), and Hangzhou DAC Biotechnology (“Hangzhou DAC”), a global leader in ADC innovation, where Hangzhou DAC’s CPT113 linker-payload has been conjugated to novel antibodies developed by WuXi Biologics against three tumor targets:

Protein Tyrosine Kinase 7 (“PTK7”), Mucin 16 (“MUC16”) and Seizure-related Protein 6 (“SEZ6”).

We believe the resulting ADCs will be able to target cancers expressing these respective tumor markers precisely and deliver the potent, cytotoxic TOPO1 inhibitor at the site of cancer.

Each of these ADCs have demonstrated tumor cell binding, tumor cell line cytotoxicity, and in vivo antitumor activity in preclinical models mimicking tumor progression.

We refer to these in-licensed ADC assets as the "ADC Therapies" herein.

We anticipate submitting three investigational new drug (“IND”) applications with the U.S.

Food and Drug Administration (“FDA”) in the coming 12 to 24 months, starting with HWK-007 for the treatment of solid tumors, including non-small cell lung cancer (“NSCLC”) and ovarian cancer, in the second half of 2025;

HWK-016 for the treatment of cancers of female origin by the end of 2025;

and HWK-206 for the treatment of cancers of neuroendocrine origin in mid-2026.

With these three assets, we believe we have the ability to pursue multiple cancer indications with high potential in large addressable patient populations, including and beyond those indications currently expected to be targeted in the upcoming Phase 1 trials.

Our track record of strong execution of novel drug formulation, research, clinical development, and commercialization in oncology, combined with our deep understanding of ADCs positions us to unlock the high potential of this differentiated ADC portfolio.

Our management team has extensive experience in the discovery, development, and commercialization of cancer therapeutics, including in senior roles at leading oncology companies.

We are supported by our board of directors and specialized scientific advisors, who contribute their deep understanding of drug discovery and development.

Furthermore, our investor base includes top life science investors.

We believe that our team is well positioned to execute on our strategy to develop and, if approved, commercialize the ADC Therapies and future pipeline assets to ultimately bring broad benefit to cancer patients worldwide.

Legacy FYARRO Business .

For the periods presented and through the FYARRO Divestiture (as defined below), our lead drug product was FYARRO ® (sirolimus protein-bound particles for injectable suspension (albumin-bound);

nab-sirolimus), which combines two established technologies:

nanoparticle albumin-bound (nab) technology and the anti-cancer agent, sirolimus.

Nab-sirolimus is a potent inhibitor of the mTOR biological pathway with demonstrated anti-cancer activity in advanced malignant perivascular epithelioid cell tumor (“PEComa”), a rare cancer.

We exclusively licensed FYARRO, previously called ABI-009, nab-sirolimus, from Abraxis BioScience, LLC, a wholly owned subsidiary of Celgene Corporation, which is a wholly owned subsidiary of Bristol-Myers Squibb Company (“BMS”).

We refer to the development, production and commercial sale of FYARRO herein as the “FYARRO Business”.

On February 22, 2022, we launched FYARRO in the United States for treatment of advanced malignant PEComa.

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See “Results of Consolidated Operations” for further discussion of our results.

In addition to advanced malignant PEComa, based on exploratory data from our completed Phase 2 registrational study, Advanced Malignant PEComa Trial (“AMPECT trial”) and data for FYARRO in other solid tumors with TSC1 and TSC2 inactivating alterations , we initiated a registration-directed tumor-agnostic Phase 2 study (“PRECISION1 trial”) of FYARRO in patients with malignant solid tumors with alterations of the Tuberous Sclerosis Complex 1 (“ TSC1 ”) or Tuberous Sclerosis Complex 2 (“ TSC2 ”) genes.

The PRECISION1 trial was opened for enrollment in the United States during the first quarter of 2022, with dosing of our first patient in March 2022.

On December 14, 2023, we announced results from an interim analysis on the first third of participants in the PRECISION1 trial.

As of December 2023, 80 patients were enrolled in the PRECISION1 trial, supporting our expected two-thirds interim analysis in the third quarter of 2024.

The Overall Response Rate ("ORR") analysis in the two-thirds interim analysis cohort will be based on independent radiological review with a minimum of six months of follow-up for all patients.

The trial is expected to be fully enrolled by May 2024 and completed by the end of 2024, with results anticipated in early 2025.

For more information regarding our business, including FYARRO, the AMPECT trial and the PRECISION1 trial, see Part I, Item 1 (Business).

On December 19, 2024, we entered into a Stock Purchase Agreement (the “Divestiture Agreement”) with KAKEN INVESTMENTS INC., a Delaware corporation (“KAKEN”), KAKEN PHARMACEUTICAL CO., LTD (“Guarantor”), and Aadi Subsidiary, Inc., a Delaware corporation and our former wholly owned subsidiary and the operating company for the FYARRO Business (“Aadi Subsidiary”).

Under the Divestiture Agreement, KAKEN acquired 100% of the outstanding shares of capital stock of Aadi Subsidiary from us at the closing for a cash payment of $102.4 million (following applicable purchase price adjustments under the Divestiture Agreement) (the "FYARRO Divestiture").

The divestiture transaction closed on March 25, 2025 and, as a result, we no longer operate the FYARRO Business.

Recent Developments

• PRECISION1 Interim Analysis .

On December 14, 2023, we reported results from a planned interim analysis on the first third of participants in the PRECISION1 trial.

The interim analysis included data from the first third of trial participants (n=40) with a minimum of 4.5 months of follow-up, including investigator-assessed response and safety analyzed separately in each of the TSC1 and TSC2 arms.

Nine different tumor types were enrolled in the TSC1 arm and 13 tumor types were enrolled in the TSC2 arm.

For more information regarding the PRECISION1 interim analysis, see Part I, Item 1 (Business - Our Product, FYARRO - Ongoing Clinical Development ).

• Leadership Transition and Board Appointment .

On September 27, 2023, our board of directors (the "Board") appointed David J.

Lennon, Ph.D., to serve as our President and Chief Executive Officer, effective as of October 2, 2023, replacing Scott Giacobello in such roles.

Giacobello had served as our Interim CEO and President since March 15, 2023, and continues to serve as the Company’s Chief Financial Officer, a position he has held since November 2021, following Dr.

Lennon’s appointment.

In addition, effective October 2, 2023, Dr.

Lennon was appointed to the Board as a Class II director and his term of office will expire at our 2025 annual meeting of stockholders or until his successor is duly elected and qualified.

BMS License Agreement

We have exclusive rights for certain patents and a non-exclusive license for certain technology and know-how pertaining to ABI-009 (which we refer to as FYARRO) pursuant to an amended and restated license agreement, dated November 15, 2019, as amended August 31, 2021 (the “BMS License Agreement”) with Abraxis BioScience, LLC, a wholly owned subsidiary of Celgene Corporation, which is a wholly owned subsidiary of Bristol-Myers Squibb Company (“BMS”).

• License Agreement .

On December 19, 2024, we entered into the License Agreement with WuXi Biologics for exclusive rights to certain patents and know-how pertaining to WuXi Biologics’ preclinical ADC Therapies leveraging Hangzhou DAC linker-payload technology targeting each of MUC16, PTK7 and SEZ6.

Under the License Agreement, we paid WuXi Biologics a non-refundable, partial upfront payment of $6.0 million on December 19, 2024 and we expect to pay an additional non-refundable, upfront payment of $38.0 million prior to April 17, 2025, in each case, for the rights and licenses granted to us by WuXi Biologics.

In accordance with the License Agreement, WuXi Biologics is eligible to receive from us (a) up to an aggregate of $265.0 million upon the achievement of certain development milestones, and (b) up to an aggregate of $540.0 million upon the achievement of certain commercial milestones, across all ADC Therapies programs.

WuXi Biologics is also entitled to running royalties during the agreed upon royalty term ranging from low-single-digit to upper-single-digit percentages of annual net sales of licensed products in the territory.

• PIPE Financing .

On December 19, 2024, we entered into subscription agreements for a private investment in public equity financing (the "2025 PIPE Financing") with certain investors (the "2025 PIPE Investors") for the sale of (i) 21,592,000 shares of our common stock, par value $0.0001 per share, at a purchase price of $2.40 per share, and (ii) 20,076,500 pre-funded warrants, at a purchase price of $2.3999 per pre-funded Warrant, for aggregate gross proceeds of $100.0 million.

The 2025 PIPE Financing was approved by our stockholders on February 28, 2025 and closed on March 4, 2025.

• Divestiture of FYARRO .

On December 19, 2024, we entered into the Divestiture Agreement with KAKEN for the sale to KAKEN of 100% of the outstanding shares of capital stock of Aadi Subsidiary and thereby all of our assets related to its FYARRO (sirolimus protein-bound particles for injectable suspension) (albumin-bound) program (the “FYARRO Business”).

Per the terms and subject to the conditions of the Divestiture Agreement, we received $102.4 million (following applicable purchase price adjustments under the Divestiture Agreement) from KAKEN in cash at the closing of the FYARRO Divestiture on March 25, 2025.

As part of the FYARRO Divestiture, KAKEN acquired the rights to the Aadi Bioscience, Inc.

name and any related trademark rights.

• Company Name Change .

On March 18, 2025, in connection with the FYARRO Divestiture, we changed our name from "Aadi Bioscience, Inc." to "Whitehawk Therapeutics, Inc." and our common stock is now traded under the symbol "WHWK".

• New Member of the Board.

On December 19, 2024, our board of directors appointed Baiteng Zhao, Ph.D.

as a new member of the board.

Zhao co-founded ProfoundBio, a clinical stage next-gen ADC developer, in

2018 and served as the Chairman and CEO of the company until it was acquired by Genmab for $1.8 billion in May 2024.

Prior to ProfoundBio, Dr.

Zhao worked at Seagen (now part of Pfizer) for more than eight years and was responsible for the modeling and simulation strategies for the development pipeline and supported preclinical and clinical development of ADC drug candidates.

• Employee Matters .

In connection with the FYARRO Divestiture, 16 employees remained with Aadi Subsidiary, Inc.

and transferred to KAKEN.

Following the FYARRO Divestiture, we have 18 full-time or part-time employees.

On February 18, 2025, we appointed David Dornan, PhD, as our Chief Scientific Officer.

Dornan brings more than two decades of experience in oncology drug discovery and development, with deep expertise in ADCs and other targeted cancer therapies.

Prior to joining us, Dr.

Dornan served as Chief Scientific Officer at Elevation Oncology and Bolt Biotherapeutics.

As of October 1, 2024, Neil Desai, Ph.D., our former Executive Chairman, and Loretta Itri, our former Chief Medical Officer, ceased their respective employments with us.

Desai continues to serve as a member of our Board.

Itri will provide consulting services to us for up to ten hours per month during the term of her agreement.

• Arbitration Win .

On September 26, 2024, we received the arbitration panel's Final Award in our arbitration against EOC Pharma (Hong Kong) Limited ("EOC").

EOC had claimed that we breached certain provisions of our license agreement with EOC, dated December 8, 2020 (the “EOC License Agreement”), including failing to provide certain manufacturing information to EOC and, as a result, EOC sought monetary damages against us.

In the arbitration panel's Final Award, it found and concluded, among other things, that we did not breach the EOC License Agreement and accordingly we are not liable for any damages to EOC.

See Note 7 to the consolidated financial statements and "EOC License Agreement" below for more information about the EOC License Agreement, its termination and the arbitration proceedings.

Legacy FYARRO Business Agreements

Former BMS License Agreement.

We had exclusive rights for certain patents and a non-exclusive license for certain technology and know-how pertaining to ABI-009 (which we refer to as FYARRO) pursuant to an amended and restated license agreement, dated November 15, 2019, as amended August 31, 2021 (the “BMS License Agreement”) with Abraxis BioScience, LLC, a wholly owned subsidiary of Celgene Corporation, which is a wholly owned subsidiary of BMS.

Under the BMS License Agreement, BMS is entitled to receive certain development milestone payments, royalties on net sales from licensed products under the agreement and any sublicense fees.

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See Note 7 to the consolidated financial statements for more information about the BMS License Agreement.

On August 30, 2021, the Company and BMS entered into Amendment No.

On August 30, 2021, we and BMS entered into Amendment No.

1 (the “Amendment”) to the BMS License Agreement.

Under the terms of the Amendment, we paid BMS $5.8 million, representing 50% of the previously outstanding payment obligation under the agreement, following the effective time of our 2021 private investment in public equity (PIPE) financing ("2021 PIPE Financing") that occurred in connection with the closing of the reverse merger of Aerpio Pharmaceuticals, Inc.

whereby Aspen Merger Subsidiary, Inc., our wholly-owned subsidiary (“Merger Sub”), merged with and into Aadi Subsidiary, Inc.

(formerly known as Aadi Bioscience, Inc.

(“Private Aadi”)), with Private Aadi surviving as our wholly-owned subsidiary (the “Merger”).

Pursuant to the terms of the amendment, the remaining portion of the previously outstanding payment obligation ($5.8 million), which is recorded on our consolidated balance sheets as due to licensor, is due on the third anniversary of the effective time of the 2021 PIPE Financing (i.e., August 26, 2024), plus any accrued and unpaid interest due thereon.

EOC License Agreement

whereby Aspen Merger Subsidiary, Inc., our wholly-owned subsidiary (“Merger Sub”), merged with and into Aadi Subsidiary (formerly known as Aadi Bioscience, Inc., with Aadi Subsidiary surviving as our wholly-owned subsidiary (the “Merger”).

Pursuant to the terms of the amendment, the remaining portion of the previously outstanding payment obligation ($5.8 million), was paid by the third anniversary of the effective time of the 2021 PIPE Financing (i.e., August 26, 2024).

As part of its purchase of the FYARRO Business, KAKEN acquired Aadi Subsidiary and our rights and responsibilities under the BMS License Agreement.

Former EOC License Agreement.

In December 2020, we entered into the license agreement ("EOC License Agreement") with EOC Pharma (Hong Kong) Limited ("EOC") under which we received $14.0 million in January 2021 in non-refundable upfront consideration as partial payment for the rights and licenses granted to EOC by us for the further development and commercialization of FYARRO in the People’s Republic of China, Hong Kong Special Administration Region, Macao Special Administrative Region and Taiwan (the “Licensed Territory”).

In accordance with the BMS License Agreement, we are required to pay 20% of all sublicense fees to BMS.

As such, we recognized $2.8 million of license expense in the fourth quarter of 2020 and had a corresponding $2.8 million sublicense payable to BMS as of December 31, 2020, which was paid in 2021.

During the fourth quarter of 2021, we recognized license revenue and received $1.0 million from EOC for achieving the FDA approval milestone in November 2021.

In accordance with the BMS License Agreement, we recognized $0.2 million of license expense in the fourth quarter of 2021 and had a corresponding $0.2 million sublicense payable to BMS as of December 31, 2021, which was paid in 2022.

On June 27, 2022, we received written notice from EOC that EOC has elected to terminate the EOC License Agreement, effective immediately.

On June 27, 2022, we received written notice from EOC that EOC elected to terminate the EOC License Agreement, effective immediately.

On June 27, 2022, EOC filed a Request for Arbitration with the International Chamber of Commerce’s International Court of Arbitration against us.

The arbitration process is ongoing.

We intend to defend ourselves vigorously in this matter and pursue all relief to which we are entitled.

We are unable to estimate the possible loss or range of loss, therefore no amounts have been accrued as of December 31, 2023.

See Notes 8 and 13 to the audited

consolidated financial statements for more information about the EOC License Agreement, its termination and pending arbitration.

Mirati Collaboration

In October 2022, we entered into a collaboration and supply agreement with Mirati Therapeutics, Inc.

(“Mirati”) to evaluate the combination of Mirati’s adagrasib, a KRAS G12C selective inhibitor, and FYARRO in KRAS G12C mutant non-small cell lung cancer (NSCLC) and other solid tumors.

Under the terms of the agreement, Mirati will be responsible for sponsoring and operating the Phase 1/2 study and we will supply study drug and jointly share the cost of the study.

The primary objective of this multi-center, single-arm, open-label Phase 1/2 trial is to determine the optimal dose and recommended Phase 2 dose for the combination of adagrasib and FYARRO in patients with KRAS G12C- mutant solid tumors.

In addition, the study will investigate the safety, tolerability and efficacy of adagrasib and FYARRO in combination in patients both with and without prior exposure to a KRAS G12C inhibitor.

The trial will build on preclinical data showing enhanced anti-tumor efficacy with the combination of adagrasib and FYARRO relative to either agent alone.

In August 2023, we announced that the first patient dosing occurred in the Phase 1/2 trial.

On September 26, 2024, the arbitration panel issued a Final Award which, among other things, found and concluded that we did not breach the EOC License Agreement and accordingly we are not liable for any damages to EOC .

See Note 7 to the consolidated financial statements for more information about the EOC License Agreement, its termination and the arbitration proceedings.

Former Mirati Collaboration.

In October 2022, we entered into a collaboration and supply agreement with Mirati to evaluate t he combination of Mirati’s adagrasib and FYARRO in KRAS G12C mutant NSCLC and other solid tumors.

In May 2024, we announced the mutually agreed upon termination of the collaboration and supply agreement with Mirati.

Enrollment in the Phase 1/2 study has been closed and the study is winding down.

Under the terms of the agreement, Mirati was responsible for sponsoring and operating the Phase 1/2 study and we supplied study drug and jointly shared the cost of the study, which will continue during the winding down process.

Impact of Negative Global or National Events

Businesses have been and will continue to be impacted by a number of challenging global and national events and circumstances that continue to evolve, including the recent turmoil in the global banking system, public health epidemics, such as the COVID-19 pandemic, extreme weather conditions, increased economic uncertainty, inflation, rising interest rates, and geopolitical instability, including the conflicts in Ukraine, the Middle East and in other countries.

Businesses have been and will continue to be impacted by a number of challenging global and national events and circumstances that continue to evolve, including the recent turmoil in the global banking system, public health epidemics, such as the COVID-19 pandemic, extreme weather conditions, increased economic uncertainty, inflation, rising interest rates, the implementation of tariffs (and, as applicable, their subsequent modification or removal), and geopolitical instability, including the conflicts in Ukraine, the Middle East and in other countries.

The extent of the impact of these events and circumstances on our business, operations and development timelines and plans remains uncertain, and will depend on certain developments, including the duration and scope of the events and their impact on our development activities, 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.

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While we have resumed normal operations, any resurgence of the COVID-19 pandemic may cause us to reinstitute certain measures to protect employee safety, including staggered work hours or reduced in-person staffing, that could result in additional disruption and/or delays in our ability to conduct development activities.

We have been and continue to actively monitor our supply chain in light of these challenging global and national events and circumstances, including our third-party materials suppliers.

We experienced some supply disruptions due to the COVID-19 pandemic, including closures at certain chip manufacturers, which led to extended lead times for FYARRO and diversion of certain lab materials needed to support COVID-19 relief efforts.

While these disruptions have been resolved, we are continuing to monitor our supply chain and contingency planning is ongoing with our partners to reduce the possibility of an interruption to our development activities or the availability of necessary materials.

The ultimate impact of these global and national events and circumstances, either individually or in aggregate, is highly uncertain and subject to change.

To the extent possible, we are conducting business as usual, with necessary or advisable modifications to mitigate potentially negative impacts to our business.

For example, during the COVID-19 pandemic, our clinical trials were affected by the closure of offices, lack of resources and closure of borders, among other measures being put in place around the world and we made certain modifications to employee travel, with masking and vaccination requirements in our offices, and with our employees working remotely fully or intermittently.

Any inability to travel and conduct face-to-face meetings, as well as constraints surrounding hospital infrastructure and staff, can also make it more difficult to enroll and maintain patients in ongoing or planned clinical trials.

We will continue to actively monitor the rapidly evolving situation related to these global and national events, and may take further actions to mitigate potential negative impacts to our business, and that may alter our operations, including those that may be required by federal, state or local authorities, or that we determine are in the best interests of our employees and other third parties with whom we do business.

At this point, the extent to which these global or national events and circumstances may affect our future business, operations and development timelines and plans, including the resulting impact on our expenditures and capital needs, remains uncertain.

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We recorded net product sales of $26.0 million and $24.4 million during the years ended December 31, 2024 and 2023, respectively.

• We have built a cross-functional commercial team consisting of marketing, market access and commercial operations and will continue to strategically build our sales and our commercial infrastructure with capabilities designed to scale when necessary to support future commercial launches.

As a result of the FYARRO Divestiture, we no longer commercialize FYARRO as of March 25, 2025.

As the commercial sale of FYARRO constituted our sole source of revenue, we do not expect to generate further revenue for the foreseeable future.

• We had built a cross-functional commercial team consisting of marketing, market access and commercial operations.

Expenses related to our commercialization of FYARRO, in cluding personnel expenses, sales support, and marketing are included in selling, general and administrative expenses for the years ended December 31, 2024 and 2023.

We expect these expenses to decrease, as compared to prior periods.

• We continue to build out our research and development team and we expect our research and development costs will increase in 2024, relative to prior periods, as a result of significant expenses related to the PRECISION1 trial which was open to enrollment during the years ended December 31, 2023 and 2022, with the first patient dosed in March 2022.

We also expect our research and development costs to increase in 2024 and in future periods, as compared to 2023, based on anticipated expenses related to the two new clinical programs for FYARRO described under "Recent Developments - New Clinical Indi cations" above.

We expect these expenses to decrease, as compared to prior periods, due to our workforce reductions in 2024 and the FYARRO Divestiture.

• We expect to increase our investment in research and development related to the ADC Therapies.

W e will continue to incur significant research and development and other expenses related to such ongoing operations .

Under the License Agreement, we paid $6.0 million to WuXi Biologics in the fourth quarter of 2024 and expect to pay $38.0 million to WuXi Biologics in the second quarter of 2025.

• Under the BMS License Agreement, as described above, we made a payment of $5.8 million to BMS on August 26, 2024 .

Liquidity and Capital Resources

As of December 31, 2024, we had $47.2 million of cash, cash equivalents and short-term investments.

Based on our current plans, we believe our existing cash, cash equivalents and short-term investments will enable us to conduct our planned operations into the fourth quarter of 2025.

Upon the completion of the strategic transactions announced in December 2024, we added approximately $202.4 million to our cash, cash equivalents and short-term investments as of March 26, 2025, which includes $102.4 million received from the FYARRO Divestiture and $100.0 million received from the 2025 PIPE Financing.

We expect to pay $38 million in April 2025 to Wuxi Biologics for the in-licensing of the ADC Therapies.

Based on our current plans, we believe our existing cash, cash equivalents and short-term investments will enable us to conduct our planned operations into 2028.

We have incurred net losses in each year since inception and as of December 31, 2024 we had an accumulated deficit of $332.7 million.

These losses have resulted principally from costs incurred in connection with research and development activities, selling, general and administrative costs associated with our operations, and costs associated with the Merger,

We expect to continue to incur significant expenses and operating losses for the foreseeable future due to the cost of research and development, including conducting preclinical and clinical trials and identifying and designing product candidates, the regulatory approval process for FYARRO outside the United States and in additional indications and any other product candidates we may develop in the future and the commercial launch of FYARRO.

FYARRO Divestiture, 2025 PIPE Financing, and the in-licensing of the ADC Therapies.

We expect to continue to incur significant expenses and operating losses for the foreseeable future due to the cost of research and development, including conducting preclinical and clinical trials of the ADC Therapies and identifying and designing product candidates and the regulatory approval process for any product candidates we may develop.

Basis of Presentation

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Rebates are generally invoiced and paid in arrears so that the accrual balance consists of an estimate of the amount expected to be incurred for the current quarter’s activity.

If actual future rebates vary

from estimates, we may need to adjust prior period accruals, which would affect product sales in the period of adjustment.

If actual future rebates vary from estimates, we may need to adjust prior period accruals, which would affect product sales in the period of adjustment.

• Chargebacks :

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Research and development activities are central to our business.

We expect to increase our investment in research and development in order to advance FYARRO in additional indications through clinical trials.

As a result, we expect that our research and development expenses will increase in the foreseeable future as we continue to invest in research and development activities, pursue clinical development of FYARRO in additional indications and any other product candidates we may develop in the future and expand our product candidate pipeline.

The process of commercialization and conducting the necessary preclinical and clinical research to obtain regulatory approval is costly and time-consuming.

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

Accordingly, to the extent that our product candidates continue to advance into clinical trials, including larger and later-stage clinical trials, our expenses will increase substantially and may become more variable.

We expect to increase our investment in research and development as a result of the ADC transaction.

We will continue to incur significant research and development and other expenses related to such ongoing operations.

Cost of Goods Sold

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Costs incurred prior to the FDA approval were expensed when incurred .

Impairment of Acquired Contract Intangible Asset

Impairment of acquired contract intangible asset relates to a write down of the acquired contract intangible asset to fair value.

During the year ended December 31, 2022, we recognized an impairment of $3.7 million to fully impair the contract intangible asset based on Gossamer's termination of the license agreement, dated June 24, 2018, with Gossamer Bio, Inc.

("Gossamer"), as amended (the "Gossamer License Agreement"), as a result of Gossamer not meeting its primary or secondary endpoint in the UC- SHIFT clinical trial.

Other Income (Expense), Net

Other income, net consists of interest income earned on cash, cash equivalents and short-term investments, partially offset by interest expense related to the convertible promissory notes.

Other income, net consists of interest income earned on cash, cash equivalents and short-term investments.

Income Tax Expense

During the years ended December 31, 2023 and 2022, we recognized no income tax expense on the statements of operations and comprehensive loss.

During the years ended December 31, 2024 and 2023, we recognize d no income tax expense on the statements of operations and comprehensive loss.

Since our formation in 2011, we have not recorded any U.S.

federal or state income tax benefits for the net losses we have incurred in each year or our earned tax credits, due to our uncertainty of realizing a benefit from those items.

federal or state income tax benefits for the net losses we have incurred in each year or our earned tax c redits, due to our uncertainty of realizing a benefit from those items.

Results of Operations:

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Research and development 51,030 48,929

Restructuring charges 2,638 —

Cost of goods sold 3,024 2,809

Impairment of acquired contract intangible asset — 3,724

Total operating expenses 93,441 96,287

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Product Sales, Net

Our product sales, net consist of sales of FYARRO since its launch in the United States on February 22, 2022.

Our product sales, net consist of sales of FYARRO.

Product sales, net for the years ended December 31, 2024 and 2023 were $26.0 million and $24.4 million, respectively.

The increase in product sales, net of $1.6 million compared to the same period in the prior year was primarily driven by stronger demand.

Operating Expenses

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Selling, general and administrative expenses for the year ended December 31, 2024 , were $36.7 million, compared to $44.5 million for the year ended December 31, 2023.

The $4.3 million increase was primarily driven by $4.1 million of legal costs predominantly related to the EOC arbitration and other related expenses, $0.7 million of personnel expenses related to increased headcount, incentive bonuses and share-based compensation, and $1.3 million of commercial and marketing expense, offset by a decrease of $1.8 million of consulting expenses and insurance.

The $7.8 million decrease was primarily driven by a reduction of $5.5 million of commercial and marketing expense, $3.2 million of personnel expenses, $0.8 million of legal costs and other expenses, offset by an increase of $1.7 million related to consulting and insurance expense.

Research and Development Expenses

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Research and development expenses for the year ended December 31, 2024 , were $51.0 million, compared to $48.9 million for the year ended December 31, 2023.

The $16.2 million increase was primarily driven by a $7.0 million increase in clinical development expenses with $5.5 million of the $7.0 million increase related to the PRECISION1 trial, $4.5 million in expenses related to headcount, consultants, and other expenses, and $4.7 million related to clinical drug product manufacturing.

The $2.1 million increase was primarily driven by a $8.2 million increase in expenses which consisted of a $6.0 million upfront payment to WuXi Biologics, clinical development expenses related to the EEC and NET trials, and $0.7 million in clinical drug product manufacturing, offset by a $6.8 million reduction in expenses related to personnel expenses, consultants, and other expenses.

Restructuring Charges

Restructuring charges for the year ended December 31, 2024 were $2.6 million.

The increase in restructuring expense was due to a restructuring plan to reduce our workforce by 32% in response to our announcement on August 20, 2024 that we halted the registration-intended PRECISION1 trial of nab-sirolimus in patients with solid tumors harboring TSC1 or TSC2 inactivating alterations.

Cost of Goods Sold

Cost of goods sold for the year ended December 31, 2023 and 2022 was $2.8 million and $1.3 million, respectively.

This increase is primarily driven by royalties incurred on product sold.

Impairment of Acquired Contract Intangible Asset

During the year ended December 31, 2022 , we recorded a $3.7 million impairment charge to reduce the carrying value of the intangible asset to its fair value of zero, based on a formal notice of termination we received on April 25, 2022 from Gossamer for the Gossamer License Agreement.

The Gossamer License Agreement terminated effective July 24, 2022.

Based on the Notice of Termination, we fully impaired the intangible asset during the nine months ended September 30, 2022, as the Gossamer License Agreement is the sole underlying asset.

In connection with the termination of the Gossamer License Agreement, the CVR Agreement (as defined in Note 5 to the consolidated financial statements), pursuant to which the contingent value rights (“CVRs”) were issued to legacy holders of common stock of Aerpio immediately prior to the Merger, automatically terminated in accordance with its terms and the CVRs were automatically cancelled and forfeited without any consideration or payment, in each case effective July 24, 2022.

Cost of goods sold for the years ended December 31, 2024 and 2023 was $3.0 million and $2.8 million, respectively.

This increase is primarily driven by an increase of costs incurred on sales of FYARRO and costs to manufacture and prepare the product for sale.

Other Income (Expense), Net

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Other income, net for the year ended December 31, 2024 , was $3.8 million of income, compared to $6.2 million of income for the year ended December 31, 2023 .

The change was primarily driven by higher interest rates on short-term investments held during the year ended December 31, 2023 compared to the year ended December 31, 2022.

The change was primarily driven by a decrease in short-term investments held during the year ended December 31, 2024 compared to the year ended December 31, 2023.

Liquidity and Capital Resources

As of December 31, 2024, we had $47.2 million of cash, cash equivalents and short-term investments.

Based on our current plans, we believe our existing cash, cash equivalents and short-term investments will enable us to conduct our planned operations into the fourth quarter of 2025.

We expect to pay $38 million in April 2025 to Wuxi Biologics for the in-licensing of the ADC Therapies.

Based on our current plans, we believe our existing cash, cash equivalents and short-term investments will enable us to conduct our planned operations into 2028.

We have incurred net losses in each year since inception and as of December 31, 2024, we had an accumulated deficit of $332.7 million.

Our net losses were $65.8 million and $60.5 million for the years ended December 31, 2023 and 2022,

respectively.

Our net losses were $63.7 million and $65.8 million for the years ended December 31, 2024 and 2023, respectively.

These losses have resulted principally from costs incurred in connection with research and development activities and selling, general and administrative costs associated with our operations.

We expect to continue to incur significant expenses and operating losses for the foreseeable future due to the cost of research and development, including conducting preclinical studies and clinical trials, identifying and designing product candidates, the regulatory approval process for FYARRO, outside the United States and in additional indications and any other product candidates we may develop in the future, and the continued commercialization of FYARRO.

We expect our expenses, and the potential for losses, to increase as we conduct clinical trials of FYARRO in additional indications and seek to expand our pipeline.

On September 22, 2022, we received funding of $72.2 million, net from a private investment in public equity financing (the "2022 PIPE Financing") with certain investors (the "2022 PIPE Investors").

We expect to continue to incur significant expenses and operating losses for the foreseeable future due to the cost of research and development, including conducting preclinical studies and clinical trials of the ADC Therapies, identifying and designing product candidates and the regulatory approval process for any product candidates we may develop.

On March 17, 2022, we entered into a Sales Agreement (the “Sales Agreement”) with Cowen and Company, LLC (“Cowen”), with respect to an “at the market offering” pursuant to which we may offer and sell, from time to time at our sole discretion, shares of our common stock having aggregate gross proceeds of up to $75.0 million through Cowen as our sales agent.

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The shares of our common stock to be offered and sold under the Sales Agreement will be issued and sold pursuant to our shelf registration statement on the Form S-3 (File No.

333-255129) (the “Prior Registration Statement”), which was filed with the SEC on April 8, 2021, and which became effective on April 15, 2021, as the same may be replaced by our shelf registration statement on Form S-3 (File No.

333-277018) (the “New Registration Statement”), which was filed with the SEC on February 12, 2024, and which has not yet become effective.

No securities have yet been sold under the Prior Registration Statement.

The Prior Registration Statement will expire on April 15, 2024, the third anniversary of its effective date, but may continue to be used until the New Registration Statement becomes effective or until 180 days after the third anniversary of the Prior Registration Statement, whichever is earlier, as provided in Securities Act Rule 415.

We filed a prospectus supplement with the SEC on March 21, 2022 in connection with the offer and sale of the shares pursuant to the Sales Agreement.

The Prior Registration Statement presently allows us, and the new Registration Statement will allow us, to sell from time to time up to $150.0 million of common stock, preferred stock, debt securities, warrants, or units comprised of any combination of these securities, for our own account in one or more offerings and is intended to provide us flexibility to conduct registered sales of our securities, subject to market conditions and our future capital needs.

333-277018) (the “Shelf Registration Statement”), which was filed with the SEC on February 12, 2024 and which became effective April 30, 2024.

No securities have yet been sold under the Shelf Registration Statement.

We filed a prospectus supplement with the SEC on May 3, 2024 in connection with the offer and sale of the shares pursuant to the Sales Agreement.

The prospectus supplement offers up to an aggregate of $13.5 million in shares of our common stock.

We will be required to file another prospectus supplement in the event we want to offer more than $13.5 million in shares of our common stock in accordance with the Sales Agreement.

The Shelf Registration Statement allows us to sell from time to time up to $150.0 million of common stock, preferred stock, debt securities, warrants, or units comprised of any combination of these securities, for our own account in one or more offerings and is intended to provide us flexibility to conduct registered sales of our securities, subject to market conditions and our future capital needs.

The terms of any offering thereunder will be established at the time of such offering and will be described in a prospectus supplement filed with the SEC prior to the completion of any such offering.

On September 22, 2022, the Company entered into the Purchase Agreement for the 2022 PIPE Financing with the 2022 PIPE Investors for the sale of 3,373,526 shares of our common stock for a price of $12.50 per share and Pre-Funded Warrants to purchase an aggregate of 2,426,493 shares of our common stock, at a purchase price of $12.4999 per Pre-Funded Warrant.

On September 22, 2022, we entered into the Purchase Agreement on a private investment in public equity financing (the "2022 PIPE Financing") with certain investors (the "2022 PIPE Investors") for the sale of 3,373,526 shares of our common stock for a price of $12.50 per share and Pre-Funded Warrants to purchase an aggregate of 2,426,493 shares of our common stock, at a purchase price of $12.4999 per Pre-Funded Warrant.

The Pre-Funded Warrants are exercisable at an exercise price of $0.0001 and will be exercisable until exercised in full.

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Net cash used in operating activities $ (59,550) $ (59,663)

Net cash provided by (used in) investing activities 83,206 (132,886)

Net cash provided by investing activities 25,202 83,206

Net cash provided by financing activities 130 326

Net increase (decrease) in cash, cash equivalents and restricted cash $ 23,869 $ (109,906)

Net (decrease) increase in cash, cash equivalents and restricted cash $ (34,218) $ 23,869

Operating Activities

Our cash used in operating activities primarily results from our net loss adjusted for non-cash expenses, changes in working capital components, amounts due to contract research organizations to conduct our clinical programs and employee-related expenditures for research and development and selling, general and administrative activities.

Our cash flows from operating activities will continue to be affected by spending to advanced malignant PEComa, advance and support

FYARRO in additional indications in the clinic, and other operating and general administrative activities, including operating as a public company.

For the year ended December 31, 2023, cash used in operating activities was $59.7 million and resulted from (i) our net loss of $65.8 million, (ii) a $3.4 million net increase in our operating assets and liabilities, primarily driven by an increase in accounts receivable, inventory, and accounts payable, offset by a decrease in prepaid expenses and other current assets and accrued liabilities, and (iii) by net non-cash adjustments totaling $9.5 million, which were primarily related to share-based compensation expense, discount amortization on short-term investments, lease expense, and depreciation and amortization expense.

For the year ended December 31, 2022, cash used in operating activities was $49.6 million and resulted from (i) our net loss of $60.5 million, and (ii) a $1.8 million net increase in our operating assets and liabilities, primarily driven by an increase in accounts receivable, prepaid expenses, inventory related to the commercial launch of FYARRO in February 2022, and accrued expenses;

offset by a decrease in accounts payable, and (iii) $12.7 million in non-cash adjustments, which were primarily related to share-based compensation expense, the impairment of the contract intangible asset, and depreciation and amortization expense.

Our cash flows from operating activities will continue to be affected by spending to advance and support our clinical programs and other operating and general administrative activities, including operating as a public company, and may fluctuate significantly from quarter-to-quarter and year-to-year.

For the year ended December 31, 2024, cash used in operating activities was $59.6 million and resulted from (i) our net loss of $63.7 million, (ii) a $6.1 million net increase in cash used to fund changes in net operating assets and liabilities, and (iii) net non-cash adjustments totaling $10.2 million, which were primarily related to share-based compensation expense, discount amortization on short-term investments, lease expense, and depreciation expense.

For the year ended December 31, 2023, cash used in operating activities was $59.7 million and resulted from (i) our net loss of $65.8 million, (ii) a $3.4 million net increase in cash used to fund changes in net operating assets and liabilities, and (iii) net non-cash adjustments totaling $9.5 million, which were primarily related to share-based compensation expense, discount amortization on short-term investments, lease expense, and depreciation and amortization expense.

Investing Activities

Cash provided by investing activities for the year ended December 31, 2023 related to maturities of short-term investments of $151.6 million, offset by purchases of fixed assets of $4.0 million and short-term investments of $64.4 million.

Cash used in investing activities for the year ended December 31, 2022 related to purchases of short-term investments of $145.2 million offset by maturities of $12.8 million.

Cash provided by investing activities for the year ended December 31, 2024 was $25.2 million related to maturities of short-term investments of $63.3 million, offset by purchases of short-term investments of $36.5 million and fixed assets of $1.7 million.

Cash provided by investing activities for the year ended December 31, 2023 was $83.2 million related to maturities of short-term investments of $151.6 million, offset by purchases of short-term investments of $64.4 million and fixed assets of $4.0 million.

Financing Activities

Cash provided by financing activities for the year ended December 31, 2024 was $0.1 million and related to the issuance of common stock under the employee stock purchase plan, offset by financing costs related to the Sales Agreement.

Cash provided by financing activities for the year ended December 31, 2023 was $0.3 million and related to the issuance of common stock under the employee stock purchase plan and exercise of stock options, offset by financing costs related to the Sales Agreement.

Cash provided by financing activities for the year ended December 31, 2022 related to $72.5 million gross cash proceeds from our 2022 PIPE Financing, $0.4 million from exercise of stock options and $0.3 million in proceeds from the issuances of stock under the ESPP, offset by $0.7 million of financing costs related to the 2021 PIPE Financing and the 2022 PIPE Financing.

Material Cash Requirements

In April 2022, we entered into a lease for 10,615 square feet of office space in Morristown, New Jersey.

In April 2022, we entered into a sublease for 10,615 square feet of office space in Morristown, New Jersey.

The term of the lease is seventy-three months unless terminated sooner.

In connection with the FYARRO Divestiture, KAKEN assumed our sublease for the NJ office space, but we agreed to co-inhabit the office with KAKEN during a transition period.

In August 2021, we entered into an amendment to extend the lease of our 2,760 square feet of office space in Pacific Palisades, California.

We exercised an option, under our prior lease agreement, to extend the term of the lease for an additional three-year period.

We exercised an option, under our prior lease agreement, to extend the term for an additional period of three (3) years and six (6) months, until February 28, 2025, with an option to renew for an additional three (3) years in accordance with the terms of the Pacific Palisades Lease.

Included in the renewal were nine months of rent abatement and a rent escalation clause.

In February 2025, we did not exercise our option to renew the lease.

Rent expense is being recorded on a straight-line basis.

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See Note 6 to the consolidated financial statements for details related to future lease payments.

In January 2022, we entered into a Negotiated Purchase Order Terms and Conditions for Clinical and Commercial Product, as amended effective as of August 1, 2022 (the “Fresenius Agreement”), with Fresenius Kabi, LLC (“Fresenius Kabi”), pursuant to which Fresenius Kabi will manufacture FYARRO for us and we will purchase FYARRO as a finished drug product from Fresenius Kabi, on a purchase-order basis.

The Fresenius Agreement contains specific activities such as non-cancellable commitments, minimum purchase commitments, and binding annual forecasts.

The Fresenius Agreement is effective through March 31, 2024 (or such later date as may be agreed between the parties in writing) and we are currently negotiating an extension to such agreement.

Under the Fresenius Agreement, we may purchase FYARRO for either clinical or commercial purposes for use in the United States and Canada.

In October 2022, we entered into a collaboration and supply agreement with Mirati to evaluate the combination of Mirati’s adagrasib, a KRAS G12C selective inhibitor, and FYARRO in KRAS G12C mutant non-small cell lung cancer (NSCLC) and other solid tumors.

Under the terms of the agreement, Mirati will be responsible for sponsoring and operating the Phase 1/2 study and we will supply study drug and jointly share the cost of the study.

In January 2022, we entered into a Negotiated Purchase Order Terms and Conditions for Clinical and Commercial Product, as amended effective as of August 1, 2022, March 31, 2024, and July 31, 2024 (the “Fresenius Agreement”) with Fresenius Kabi, LLC (“Fresenius Kabi”), pursuant to which Fresenius Kabi manufactured FYARRO for us and we purchased FYARRO as a finished drug product from Fresenius Kabi, on a purchase order basis.

The Fresenius Agreement contained specific activities such as non-cancellable commitments, minimum purchase commitments, or binding annual forecasts.

Under the Fresenius Agreement, which was effective through September 30, 2024, we purchased FYARRO for either clinical or commercial purposes for use in the United States and Canada.

As a result of the FYARRO Divestiture, all of our rights and obligations under the Fresenius Agreement transferred to KAKEN.

We also have contracts with various organizations to conduct research and development activities, including clinical trial organizations to manage clinical trial activities and manufacturing companies to manufacture the drug product used in the clinical trials.

The scope of the services under these research and development contracts can be modified and the contracts

cancelled by us upon written notice.

In the event of a cancellation, we would be liable for the cost and expenses incurred to date as well as any close out costs of the service arrangement.

The scope of the services under these research and development contracts can be modified and the contracts cancelled by us upon written notice.

In the event of cancellation, we would be liable for the cost and expenses incurred to date as well as any close out costs of the service arrangement.

Under the License Agreement, we expect to pay an additional non-refundable, upfront payment of $38.0 million prior to April 17, 2025, in each case, for the rights and licenses granted to us by WuXi Biologics.

Critical Accounting Estimates

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Research and Development Costs

We incur substantial expenses associated with clinical trials.

Accounting for clinical trials relating to activities performed by CROs and other external vendors requires us to exercise significant estimates in regard to the timing and accounting for these expenses.

We estimate costs of research and development activities conducted by service providers, which include, the conduct of preclinical studies, contract manufacturing activities and clinical activities.

We accrue and expense research and development expenditures as incurred, which include costs related to clinical trial activities.

We estimate costs of research and development activities conducted by service providers, which include, the conduct of preclinical studies, contract manufacturing activities and clinical activities based upon estimates of the services received and related expenses incurred that have yet to be invoiced by the Clinical Research Organizations ("CROs "), professional service providers, and other vendors providing clinical trial services (collectively, the “service providers”) and include these costs in the accrued and other current liabilities or prepaid expenses, as applicable, on the balance sheets and within research and development expense on the consolidated statements of operations and comprehensive loss.

The diverse nature of services being provided under CRO and other vendor arrangements, the different terms and milestone arrangements that exist for each type of service and the lack of timely information related to certain clinical activities complicates the estimation of accruals for services rendered by CROs and other vendors in connection with clinical trials.

We record the estimated costs of research and development activities based upon the estimated amount of services provided but not yet invoiced and include these costs in the accrued and other current liabilities or prepaid expenses, as applicable, on the balance sheets and within research and development expense on the consolidated statements of operations and comprehensive loss.

In estimating the duration of a clinical study, we evaluate the start-up, treatment and wrap-up periods, payment arrangements and services rendered attributable to each clinical trial and fluctuations are regularly tested against payment plans and trial completion assumptions.

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We make significant judgments and estimates in determining the accrued liabilities and prepaid expense balances in each reporting period.

actual costs become known, we adjust our estimates and related accounts on the balance sheet.

As actual costs become known, we adjust our estimates and related accounts on the balance sheet.

We have not experienced any material differences between accrued costs and actual costs incurred since our inception.

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Total $ 10,839 $ 11,954

As of December 31, 2023, total unamortized share‑based compensation was $25.3 million which we expect to recognize over a weighted average period of 2.5 years.

As of December 31, 2023, there was $0.1 million of unrecognized compensation cost related to restricted stock units, which is expected to be recognized over a weighted average period of nine months.

The intrinsic value of all outstanding stock options as of December 31, 2023 was $24,900.

As of December 31, 2024, total unrecognized compensation cost related to stock options was $9.9 million which we expect to recognize over a weighted average period of 1.8 years.

As of December 31, 2024, there was $0.4 million of

unrecognized compensation cost related to restricted stock units, which is expected to be recognized over a weighted average period of 3.2 years.

The intrinsic value of all outstanding stock options and restricted stock units as of December 31, 2024 was $1.8 million and $0.8 million, respectively.

Recent Accounting Pronouncements

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

What changed 10-K

Item 7. Management’s Discussion and Analysis