Wave Life Sciences Ltd. 10-K

Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and related notes appearing elsewhere in this Annual Report on Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section of this Annual Report on Form 10-K, our actual results could differ materially from the results described in, or implied by, these forward-looking statements. Overview We are a clinical-stage biotechnology company focused on unlocking the broad potential of ribonucleic acid (“RNA”) medicines (also known as oligonucleotides), or those targeting RNA, to transform human health. Our RNA medicines platform, PRISM ® , combines multiple modalities, chemistry innovation and deep insights into human genetics to deliver scientific breakthroughs that treat both rare and common disorders. Our toolkit of RNA-targeting modalities includes RNA editing, splicing, silencing using RNA interference (“siRNA") and antisense silencing, providing us with unique capabilities for designing and sustainably delivering candidates that optimally address disease biology. Our diversified pipeline includes clinical programs in obesity, alpha-1 antitrypsin deficiency (“AATD”), Duchenne muscular dystrophy (“DMD”), and Huntington’s disease (“HD”), as well as several preclinical programs utilizing our versatile RNA medicines platform. We were founded on the recognition that there was a significant, untapped opportunity to use chemistry innovation to tune the pharmacological properties of oligonucleotides. We have more than a decade of experience challenging convention related to oligonucleotide design and pioneering novel chemistry modifications to optimize the pharmacological properties of our molecules. We have seen in clinical trials that these chemistry modifications enhance potency, distribution, and durability of effect of our molecules. Our novel chemistry also allows us to avoid using complex delivery vehicles, such as lipid nanoparticles and viruses, and instead use clinically proven conjugates ( e.g., N -acetylgalactosamine or (“GalNAc”)) or free uptake for delivery to a variety of cell and tissue types. We maintain strong and broad intellectual property, including for our novel chemistry modifications. Our best-in-class chemistry capabilities have also unlocked new areas of biology, such as harnessing adenosine deaminases acting on RNA (“ADAR”) enzymes for messenger RNA (“mRNA”) correction and upregulation, selectively silencing a mutant allele, and more. By opening up new areas of biology, we have also opened up new opportunities to slow, stop or reverse disease and have expanded the possibilities offered through our platform. The inspiration for our multimodal platform is based on the recognition that the biological machinery (i.e., enzymes) needed to address human disease already exists within our cells and can be harnessed for therapeutic purposes with the right tools. We believe that we have built the most versatile toolkit of RNA-targeting modalities in the industry, with multiple means of repairing, restoring, or reducing proteins and designing best-fit solutions based on the unique biology of a given disease target. We are actively advancing programs using four distinct modalities, including novel A-to-I RNA editing oligonucleotides (“AIMers”). 91 These modalities include: • RNA editing, which uses AIMers that are designed to target single bases on an RNA transcript and recruit endogenous ADAR enzymes that naturally possess the ability to change an adenine (A) to an inosine (I), which cells read as guanine (G). This approach enables both the correction of G-to-A point mutations and the modulation of RNA to either upregulate protein expression, modify protein-protein interactions, or alter RNA folding and processing. AIMers are short in length, fully chemically modified, and use our novel chemistry, which make them distinct from other ADAR-mediated editing approaches. • Antisense (silencing) , which uses our oligonucleotide designed to bind to a specific sequence in a target RNA strand that encodes a disease-associated protein or pathogenic RNA. The resulting double-stranded molecule (“duplex”) is then recognized by a cellular enzyme called RNase H, which cleaves, or cuts, the target RNA in the duplex, thereby preventing the disease-associated protein from being made. • RNA interference (RNAi ) (silencing) , which uses our double-stranded RNAs called siRNAs to engage the RNAi machinery known as the RNA-induced silencing complex (“RISC”) and to silence a target RNA that is either pathogenic itself or encodes a disease-associated protein, thereby preventing the accumulation of the pathogenic species (RNA or protein). • Splicing / exon skipping , which is the processing of a nascent pre-mRNA transcript into mRNA by removing introns and joining exons together. Exon skipping uses our oligonucleotide designed to bind to a particular sequence within a target pre-mRNA and direct the cellular machinery to alter the final composition of exons in mature mRNA by deleting, or splicing out, certain specific regions of that RNA. We intentionally focus on targeting the transcriptome using oligonucleotides rather than other nucleic acid modalities such as gene therapy and DNA editing. This focus enables us to: • Leverage diversity of expression across cell types by modulating the many regulatory pathways that impact gene expression, including transcription, endogenous RNAi pathways, splicing, and translation; • Address diseases that have historically been difficult to treat with small molecules or biologics; • Access a variety of tissue types or cell types throughout the body and modulate the frequency of dosing for broad distribution in tissues over time; • Avoid the risk of permanent off-target genetic changes and other challenges associated with DNA editing or gene therapy approaches; and • Leverage well-established industry manufacturing processes and regulatory, access, and reimbursement pathways. We have a robust and diverse pipeline of potential first-or best-in-class programs addressing both rare and common diseases: • GalNAc-conjugated oligonucleotides for hepatic and metabolic diseases including: • Obesity: WVE-007 is a GalNAc-conjugated siRNA targeting inhibin βE (“INHBE”); • Alpha-1 antitrypsin deficiency ("AATD"): WVE-006 is a GalNAc-conjugated SERPINA1 AIMer; • Liver disease: GalNAc-conjugated AIMer targeting PNPLA3 I148M for correction; and • Heterozygous Familial Hypercholesterolemia (“HeFH”): GalNAc-conjugated AIMer targeting low-density lipoprotein receptor (“LDLR”) for upregulation and GalNAc-conjugated AIMer targeting apolipoprotein B (“APOB”) for correction. • Unconjugated oligonucleotides for muscle, CNS and other disease areas including: • Duchenne muscular dystrophy ("DMD"): WVE-N531 is an exon 53 splicing oligonucleotide; and 92 • Huntington’s disease ("HD"): WVE-003 is an allele-selective oligonucleotide designed to lower mutant huntingtin (“mHTT”) protein and preserve healthy, wild-type huntingtin (“wtHTT”) protein. Our RNA editing capability affords us the dexterity to address both rare and common diseases, as well as those diseases impacting large patient populations. AIMers are designed to target single bases on an RNA transcript and recruit proteins that exist in the body, called ADAR enzymes, which naturally possess the ability to change an adenine (A) to an inosine (I), which cells read as guanine (G). This approach enables both the correction of G-to-A point mutations and the modulation of RNA to either upregulate protein expression, modify protein-protein interactions, or alter RNA folding and processing. AIMers enable simplified delivery and avoid the risk of permanent changes to the genome and irreversible off-target effects with DNA-targeting approaches. AIMers are short in length, fully chemically modified, and use our novel chemistry, which make them distinct from other ADAR-mediated editing approaches. GSK Collaboration In December 2022, we announced a strategic collaboration with GlaxoSmithKline Intellectual Property (No. 3) (“GSK”) to advance transformative oligonucleotide therapeutics, including WVE-006. The collaboration combines GSK’s novel genetic insights, as well as its global development and commercial capabilities, with our PRISM platform and oligonucleotide expertise. The collaboration will enable us to continue building a pipeline of first-in-class oligonucleotide-based therapeutics and unlock new areas of disease biology, as well as realize the full value of WVE-006 as a potential best-in-class treatment for AATD that has the potential to simultaneously address both liver and lung manifestations of the disease. Our GSK collaboration has three components: (1) a discovery collaboration which enables us to advance up to three programs leveraging targets informed by GSK’s novel genetic insights; (2) a discovery collaboration which enables GSK to advance up to eight programs leveraging PRISM and our oligonucleotide expertise and discovery capabilities; and (3) an exclusive global license for GSK to WVE-006, our AATD program, that uses our proprietary AIMer technology. We will maintain development responsibilities for WVE-006 through completion of RestorAATion-2, at which point development and commercial responsibilities will transition to GSK. Takeda Collaboration (expired in October 2024) In February 2018, we entered into a global strategic collaboration with Takeda Pharmaceutical Company Limited (“Takeda”), pursuant to which we agreed to collaborate with Takeda on the research, development and commercialization of oligonucleotide therapeutics for disorders of the CNS. On October 11, 2024, we were notified by Takeda that Takeda did not intend to exercise and therefore elected to terminate its option for the HD target under the collaboration. As HD was the last active collaboration target under the collaboration, the collaboration expired with immediate effect. As a result of the option termination, we are now free to advance WVE-003, our clinical-stage Huntington’s disease program, as well as any other programs targeting HTT, independently or with other partners. 93 Financial Operations Overview We have never been profitable, and since our inception, we have incurred significant operating losses. Our net loss was $97.0 million in 2024, $57.5 million in 2023, and $161.8 million in 2022. As of December 31, 2024 and 2023, we had an accumulated deficit of $1,121.9 million and $1,024.9 million, respectively. We expect to incur significant expenses and operating losses for the foreseeable future. Revenue We recognize collaboration revenue under the GSK Collaboration Agreement, which became effective in January 2023, and the Takeda Collaboration Agreement, which became effective in April 2018 and expired in the fourth quarter of 2024, (both of which are defined in Note 5 in the notes to the consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K). We have not generated any product revenue since our inception and do not expect to generate any revenue from the sale of products for the foreseeable future. Operating Expenses Our operating expenses since inception have consisted primarily of research and development expenses and general and administrative expenses. Research and Development Expenses Research and development expenses consist primarily of costs incurred for our research activities, including our discovery efforts, and the development of our product candidates, which include: • compensation-related expenses, including employee salaries, bonuses, share-based compensation expense and other related benefits expenses for personnel in our research and development organization; • expenses incurred under agreements with third parties, including CROs that conduct research, preclinical and clinical activities on our behalf, as well as CMOs that manufacture drug product for use in our preclinical studies and clinical trials; • expenses incurred related to our internal manufacturing of drug substance for use in our preclinical studies and clinical trials; • expenses related to compliance with regulatory requirements; • expenses related to third-party consultants; • research and development supplies and services expenses; and • facility-related expenses, including rent, maintenance and other general operating expenses. We recognize research and development costs as incurred. We recognize external development costs based on an evaluation of the progress to completion of specific tasks using information provided to us by our vendors. Payments for these activities are based on the terms of the individual agreements, which may differ from the pattern of costs incurred, and are reflected in our financial statements as prepaid or accrued expenses. Our primary research and development focus has been the development of our RNA medicines platform, PRISM. We are using PRISM, which includes our novel chemistry modifications, to design, develop and commercialize a broad pipeline of first- or best-in class RNA medicines using our editing, splicing, RNAi, and antisense modalities. Our research and development expenses consist primarily of expenses related to our CROs, CMOs, consultants, other external vendors and fees paid to global regulatory agencies to conduct our clinical trials, in addition to compensation-related expenses, internal manufacturing expenses, facility-related expenses and other general operating expenses. These expenses are incurred in connection with research and development efforts and our preclinical studies and clinical trials. We track certain external expenses on a program-by-program basis. However, we do not allocate compensation-related expenses, internal manufacturing expenses, equipment repairs and maintenance expense, facility-related expenses or other operating expenses to specific programs. These expenses, which are not allocated on a program-by-program basis, are included in the “Other research and development expenses (1) , including INHBE, RNA 94 editing, PRISM, others” category along with other external expenses related to our discovery and development programs, as well as platform development and identification of potential drug discovery candidates. 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. We expect to continue to incur significant research and development expenses in the foreseeable future as we continue to manage our existing clinical trials, initiate additional clinical trials for certain product candidates, pursue later stages of clinical development for certain product candidates, maintain our manufacturing capabilities and continue to discover and develop additional product candidates in multiple therapeutic areas. General and Administrative Expenses General and administrative expenses consist primarily of compensation-related expenses, including salaries, bonuses, share-based compensation and other related benefits costs for personnel in our executive, finance, corporate, legal and administrative functions, as well as compensation-related expenses for our Board. General and administrative expenses also include legal fees; expenses associated with being a public company; professional fees for accounting, auditing, tax and consulting services; insurance costs; travel expenses; other operating costs; and facility-related expenses. Other Income, Net Other income, net is comprised of refundable tax credits from tax authorities, dividend and interest income earned on cash and cash equivalents balances, gains and losses on foreign currency transactions, and real estate taxes. We recognize refundable tax credits when there is reasonable assurance that we will comply with the requirements of the refundable tax credit and that the refundable tax credit will be received. Income Taxes We are a Singapore multi-national company subject to taxation in the United States and various other jurisdictions. As of December 31, 2024 and 2023, we have recorded a full valuation allowance against our net operating loss carryforwards and federal and state tax credits in all jurisdictions due to uncertainty regarding future taxable income. Results of Operations In this section, we discuss the results of our operations for the year ended December 31, 2024 compared to the year ended December 31, 2023 and for the year ended December 31, 2023 compared to the year ended December 31, 2022 . Comparison of the Year Ended December 31, 2024 to the Year Ended December 31, 2023 The following table summarizes our results of operations for 2024 and 2023: For the Year Ended December 31, 2024 2023 Change (in thousands) Revenue $ 108,302 $ 113,305 $ (5,003 ) Operating expenses: Research and development 159,682 130,009 29,673 General and administrative 59,023 51,292 7,731 Total operating expenses 218,705 181,301 37,404 Loss from operations (110,403 ) (67,996 ) (42,407 ) Total other income, net 13,395 9,806 3,589 Loss before income taxes (97,008 ) (58,190 ) (38,818 ) Income tax benefit (provision) — 677 (677 ) Net loss $ (97,008 ) $ (57,513 ) $ (39,495 ) Revenue Revenue for the years ended December 31, 2024 and 2023, was $108.3 million and $113.3 million, respectively, and was earned under the GSK Collaboration Agreement and the Takeda Collaboration Agreement. 95 The $5.0 million decrease in revenue year over year was driven by the revenue recognized under the GSK Collaboration Agreement, partially offset by the increase in revenue recognized under the Takeda Collaboration Agreement. The $108.3 million in revenue recognized during the year ended December 31, 2024 was comprised of $37.0 million in revenue recognized under the GSK Collaboration Agreement and $71.3 million of revenue recognized under the Takeda Collaboration Agreement. The $113.3 million in revenue recognized during the year ended December 31, 2023 was comprised of $66.3 million in revenue recognized under the GSK Collaboration Agreement and $47.0 million of revenue recognized under the Takeda Collaboration Agreement. The increase in the Takeda Collaboration revenue earned year over year was primarily due to the termination of the collaboration in October 2024, which led to the recognition of the remainder of the deferred revenue related to the research and development services, as well as the license related to the HD program. This was offset by the decrease in the GSK revenue earned year over year primarily related to the AATD program. Research and Development Expenses The following table summarizes our research and development expenses incurred for the years ended December 31, 2024 and 2023: For the Year Ended December 31, 2024 2023 Change (in thousands) AATD program $ 11,666 $ 8,453 $ 3,213 DMD programs 15,536 7,808 7,728 HD programs 11,790 13,086 (1,296 ) Other research and development expenses (1) , including INHBE, RNA editing, PRISM, others 119,976 91,617 28,359 ALS and FTD programs (discontinued) 714 9,045 (8,331 ) Total research and development expenses $ 159,682 $ 130,009 $ 29,673 (1) Includes expenses related to other research and development programs, identification of potential drug discovery candidates, compensation-related expenses, internal manufacturing expenses, equipment repairs and maintenance expense, facility-related expenses, and other operating expenses, which are not allocated to specific programs. Research and development expenses were $159.7 million for the year ended December 31, 2024, compared to $130.0 million for the year ended December 31, 2023. The increase of $29.7 million was due to the following: • an increase of $3.2 million in external expenses related to our AATD program, WVE-006 (RNA editing); • an increase of $7.7 million in external expenses related to our DMD programs, including WVE-N531 (splicing); • a decrease of $1.3 million in external expenses related to our HD programs, including WVE-003 (silencing); • an increase of $28.4 million in other research and development expenses, including INHBE, RNA editing, PRISM, and other internal and external research and development expenses that are not allocated on a program-by-program basis or are related to other discovery and development programs, and the identification of potential drug discovery candidates, mainly due to increases in compensation-related expenses and facilities-related expenses, partially offset by decreases in other external research and development expenses; and • a decrease of $8.3 million in external expenses related to our discontinued ALS and FTD program, WVE-004. General and Administrative Expenses General and administrative expenses were $59.0 million for the year ended December 31, 2024, compared to $51.3 million for the year ended December 31, 2023. The increase of $7.7 million is primarily driven by increases in compensation related expenses and administrative expenses. Other Income, Net Other income, net for the years ended December 31, 2024 and 2023 was $13.4 million and $9.8 million, respectively. The increase of $3.6 million in other income, net was primarily driven by an increase in estimated refundable tax credits as well as an increase in dividend income during the year ended December 31, 2024. 96 Income Tax Benefit During the years ended December 31, 2024 and 2023, we recorded no income tax benefit or provision and an income tax benefit of $0.7 million, respectively. The income tax benefit for the year ended December 31, 2023 was due to a change in estimate in connection with U.S. tax guidance relating to the capitalization of research and development expenditures. Comparison of the Year Ended December 31, 2023 to the Year Ended December 31, 2022 The following table summarizes our results of operations for 2023 and 2022: For the Year Ended December 31, 2023 2022 Change (in thousands) Revenue $ 113,305 $ 3,649 $ 109,656 Operating expenses: Research and development 130,009 115,856 14,153 General and administrative 51,292 50,513 779 Total operating expenses 181,301 166,369 14,932 Loss from operations (67,996 ) (162,720 ) 94,724 Total other income, net 9,806 1,578 8,228 Loss before income taxes (58,190 ) (161,142 ) 102,952 Income tax benefit (provision) 677 (681 ) 1,358 Net loss $ (57,513 ) $ (161,823 ) $ 104,310 Revenue Revenue for the year ended December 31, 2023 was $113.3 million and was earned under the GSK Collaboration Agreement and the Takeda Collaboration Agreement. Revenue for year ended December 31, 2022 was $3.6 million and was earned primarily under the Takeda Collaboration Agreement, as the GSK Collaboration Agreement became effective in January 2023. The $109.7 million increase in revenue year over year was driven by the revenue recognized under the new GSK Collaboration Agreement, after it became effective in January 2023, as well as the increase in revenue recognized under the Takeda Collaboration Agreement. The $113.3 million in revenue recognized during the year ended December 31, 2023 was comprised of $66.3 million in revenue recognized under the GSK Collaboration Agreement and $47.0 million of revenue recognized under the Takeda Collaboration Agreement. The $3.6 million in revenue recognized during the year ended December 31, 2022 was primarily related to the research and development services under the Takeda Collaboration Agreement related to the HD, C9, and SCA3 programs. During the year ended December 31, 2023, the Company recognized revenue of $47.0 million under the Takeda Collaboration. The increase in revenue earned year over year related to the Takeda Collaboration is primarily due to the termination of the C9 and SCA3 programs in 2023 which led to the recognition of the remainder of the deferred revenue related to the research and development services, as well as the options related to the C9 and SCA3 programs. Research and Development Expenses The following table summarizes our research and development expenses incurred for the years ended December 31, 2023 and 2022: For the Year Ended December 31, 2023 2022 Change (in thousands) AATD program $ 8,453 $ 3,763 $ 4,690 DMD programs 7,808 2,610 5,198 HD programs 13,086 7,952 5,134 Other research and development expenses (1) , including INHBE, RNA editing, PRISM, others 91,617 89,992 1,625 ALS and FTD programs (discontinued) 9,045 11,539 (2,494 ) Total research and development expenses $ 130,009 $ 115,856 $ 14,153 (1) Includes expenses related to other research and development programs, identification of potential drug discovery candidates, compensation-related expenses, internal manufacturing expenses, equipment repairs and maintenance expense, facility-related expenses, and other operating expenses, which are not allocated to specific programs. 97 Research and development expenses were $130.0 million for the year ended December 31, 2023, compared to $115.9 million for the year ended December 31, 2022. The increase of $14.1 million was due to the following: • an increase of $4.7 million in external expenses related to our AATD program, WVE-006 (RNA editing); • an increase of $5.2 million in external expenses related to our DMD programs, including WVE-N531 (splicing); • an increase of $5.1 million in external expenses related to our HD programs, including WVE-003 (silencing); • an increase of $1.6 million in other research and development expenses, including INHBE, RNA editing, PRISM, and other internal and external research and development expenses that are not allocated on a program-by-program basis. or are related to other discovery and development programs, and the identification of potential drug discovery candidates, mainly due to increases in compensation-related expenses and facilities-related expenses, partially offset by decreases in other external research and development expenses; and • a decrease of $2.5 million in external expenses related to our discontinued ALS and FTD program, WVE-004. General and Administrative Expenses General and administrative expenses were $51.3 million for the year ended December 31, 2023, compared to $50.5 million for the year ended December 31, 2022. The increase of $0.8 million was primarily driven by increases in other general and administrative operating expenses, partially offset by a decrease in compensation-related expenses. Other Income, Net Other income, net for the years ended December 31, 2023 and 2022 was $9.8 million and $1.6 million, respectively. The increase of $8.2 million in other income, net was primarily driven by an increase in dividend income as well as an increase in estimated refundable tax credits during the year ended December 31, 2023. Income Tax Benefit (Provision) During the years ended December 31, 2023 and 2022, we recorded an income tax benefit of $0.7 million and an income tax provision of $0.7 million, respectively. The income tax benefit for the year ended December 31, 2023 was due to a change in estimate in connection with recent U.S. tax guidance relating to the capitalization of research and development expenditures. The income tax provision for the year ended December 31, 2022 was primarily due to the requirement under the Tax Cuts and Jobs Act of 2017 for taxpayers to capitalize and amortize research and development expenditures over five or fifteen years pursuant to Section 174 of the Internal Revenue Code of 1986, as amended. Liquidity and Capital Resources Since our inception, we have not generated any product revenue and have incurred recurring net operating losses. To date, we have primarily funded our operations through public and other registered offerings of our ordinary shares and other securities, collaborations with third parties and private placements of debt and equity securities. Through December 31, 2024, we have received an aggregate of approximately $1,578.4 million in net proceeds from these transactions, consisting of $977.8 million in net proceeds from public and other registered offerings of our ordinary shares and other securities, $511.3 million from our collaborations and $89.3 million in net proceeds from private placements of our debt and equity securities. In January 2024, the representatives of the underwriters in connection with the previously disclosed underwritten public offering (the “December 2023 Offering”) exercised their option to purchase an additional 3,000,000 ordinary shares at a price of $5.00 per ordinary share as a part of the December 2023 Offering. We received an additional $14.0 million in net proceeds from the December 2023 Offering in January 2024. On September 27, 2024, we closed the September 2024 Offering in which we issued and sold 23,125,001 of our ordinary shares and the 2024 Pre-Funded Warrants to purchase up to 1,875,023 of our ordinary shares. The gross proceeds to us from the September 2024 Offering were $200.0 million before deducting underwriting discounts and commissions and other offering expenses. On October 1, 2024, the representatives of the underwriters exercised their option in full to purchase an additional 3,750,000 ordinary shares, for additional net proceeds to us of approximately $28.2 million. As of December 31, 2024, we had cash and cash equivalents of $302.1 million, restricted cash of $3.8 million and an accumulated deficit of $1,121.9 million. We expect that our existing cash and cash equivalents will be sufficient to fund our operations for at least the next twelve months. We have based this expectation on assumptions that may prove to be incorrect, and we may use our available capital resources sooner than we currently expect. In addition, we may elect to raise additional funds before we need them if the conditions for raising capital are 98 favorable due to market conditions or strategic considerations, even if we expect we have sufficient funds for our current or future operating plans. Our operating lease commitments as of December 31, 2024 total $29.1 million, of which $9.6 million is related to payments in 2025 and approximately $19.5 million is related to payments beyond 2025. On November 12, 2024, we filed a shelf registration statement on Form S-3ASR with the SEC for which we registered for sale an indeterminate amount of any combination of our ordinary shares, debt securities, warrants, rights and/or units from time to time and at prices and on terms that we may determine, which we refer to as the “2024 WKSI Shelf”. Our 2024 WKSI Shelf includes a prospectus covering up to an aggregate of $250.0 million in ordinary shares that we are able to issue and sell from time to time, through Jefferies LLC (“Jefferies”) acting as our sales agent, pursuant to the Open Market Sale Agreement, dated May 10, 2019, as amended by Amendment No. 1, dated as of March 2, 2020, Amendment No. 2, dated as of March 3, 2022, and Amendment No. 3, dated November 12, 2024, (collectively, the “Sales Agreement”), for our “at-the-market” equity program. For the three months ended December 31, 2024, we received $5.2 million in net proceeds from sales under our “at-the-market" equity program. Adequate additional financing may not be available to us on acceptable terms, or at all. Our inability to raise capital as and when needed would have a negative impact on our financial condition and our ability to pursue our business strategy. We will need to generate significant revenue to achieve profitability, and we may never do so. Cash Flows The following table summarizes our sources and uses of cash for each of the periods presented: For the Year Ended December 31, 2024 2023 2022 (in thousands) Net cash used in operating activities $ (151,026 ) $ (19,431 ) $ (127,781 ) Net cash used in investing activities (938 ) (1,115 ) (1,255 ) Net cash provided by financing activities 253,890 132,534 67,188 Effect of foreign exchange rates on cash (138 ) (95 ) (210 ) Net increase (decrease) in cash, cash equivalents and restricted cash $ 101,788 $ 111,893 $ (62,058 ) Operating Activities During 2024, operating activities used $151.0 million of cash, primarily due to our net loss of $97.0 million, partially offset by non-cash charges of $21.8 million and changes in our operating assets and liabilities of $75.8 million. The non-cash charges for 2024 related to share-based compensation expense of $13.1 million, amortization of right-of-use assets of $4.8 million, and depreciation expense of $3.9 million. The largest change in operating assets and liabilities was a $93.6 million decrease in deferred revenue, mainly driven by our Takeda Collaboration Agreement, which was partially offset by the second largest change in operating assets and liabilities, the $19.7 million decrease in accounts receivable primarily due to the collection of receivables related to the GSK Collaboration Agreement. During 2023, operating activities used $19.4 million of cash, primarily due to our net loss of $57.5 million, partially offset by non-cash charges of $19.0 million and changes in our operating assets and liabilities of $19.1 million. The non-cash charges for 2023 related to share-based compensation expense of $9.8 million, amortization of right-of-use assets of $4.2 million, and depreciation expense of $5.0 million. The largest change in operating assets and liabilities was a $54.3 million increase in deferred revenue, mainly driven by our GSK Collaboration Agreement, which became effective in January 2023, which was partially offset by the second largest change in operating assets and liabilities, the $21.1 million increase in accounts receivable primarily related to the achievement of a milestone under the GSK Collaboration Agreement. During 2022, operating activities used $127.8 million of cash, primarily due to our net loss of $161.8 million, partially offset by non-cash charges of $27.3 million and changes in our operating assets and liabilities of $6.7 million. The non-cash charges for 2022 related mainly to share-based compensation expense of $17.2 million and depreciation expense of $6.6 million. The largest change in operating assets and liabilities was a $9.3 million increase in accounts payable. Investing Activities During 2024, investing activities used $0.9 million of cash, primarily consisting of purchases of property and equipment. During 2023, investing activities used $1.1 million of cash, primarily consisting of purchases of property and equipment. 99 During 2022, investing activities used $1.3 million of cash, primarily consisting of purchases of property and equipment. Additionally, we purchased $75.0 million of short-term investments during 2022, all of which matured in 2022. Financing Activities During 2024, net cash provided by financing activities was $253.9 million, which was primarily due to the $215.8 million in net proceeds from the September 2024 Offering of ordinary shares and the 2024 Pre-Funded Warrants; as well as the $14.0 million in net proceeds from the January 2024 exercise of the underwriters’ option to purchase an additional 3,000,000 shares under the December 2023 Offering. Additionally, we received $20.4 million in net proceeds from sales under our “at-the-market” equity program. During 2023, net cash provided by financing activities was $132.5 million, primarily due to the $93.6 million in net proceeds from the December 2023 Offering, which comprised of sales of ordinary shares, as well as $34.6 million in net proceeds from the GSK Equity Investment. Additionally, there were $3.1 million in net proceeds from our "at-the-market" equity program. During 2022, net cash provided by financing activities was $67.2 million, primarily due to the $65.5 million in net proceeds from the underwritten offering we completed in June 2022, which was comprised of sales of ordinary shares and the 2022 Pre-Funded Warrants. Additionally, there were $1.1 million in net proceeds from our "at-the-market" equity program. Funding Requirements We expect to continue to incur significant expenses in connection with our ongoing research and development activities and our internal cGMP manufacturing activities. Furthermore, we anticipate that our expenses will continue to vary if and as we: • continue to conduct our clinical trials evaluating our product candidates in patients; • conduct research and preclinical development of discovery targets and advance additional programs into clinical development; • file clinical trial applications with global regulatory agencies and conduct clinical trials for our programs; • make strategic investments in continuing to innovate our research and development platform, PRISM, and in optimizing our manufacturing processes and formulations; • maintain our manufacturing capabilities through our internal facility and our CMOs; • maintain our intellectual property portfolio and consider the acquisition of complementary intellectual property; • seek and obtain regulatory approvals for our product candidates; • respond to the impacts of local and global health epidemics, the conflict involving Russia and Ukraine, the conflict in the Middle East, global economic uncertainty, volatility in inflation, volatility in interest rates or market disruptions on our business; and • establish and build capabilities to market, distribute and sell our product candidates. We may experience delays or encounter issues with any of the above, including but not limited to failed studies, complex results, safety issues or other regulatory challenges. Because of the numerous risks and uncertainties associated with the development of drug candidates and because the extent to which we may enter into collaborations with third parties for development of product candidates is unknown, we are unable to estimate the amounts of future capital outlays and operating expenses associated with completing the research and development for our therapeutic programs. Our future capital requirements for our therapeutic programs will depend on many factors, including: • the progress, results and costs of conducting research and continued preclinical and clinical development for our therapeutic programs and future potential pipeline candidates; • the number and characteristics of product candidates and programs that we pursue; • the cost of manufacturing clinical supplies of our product candidates; • whether and to what extent milestone events are achieved under our collaborations with Takeda and GSK or any potential future licensee or collaborator; • the costs, timing and outcome of regulatory review of our product candidates; • our ability to obtain marketing approval for our product candidates; 100 • the impacts of local and global health epidemics, the conflict involving Russia and Ukraine, the conflict in the Middle East, global economic uncertainty, volatility in inflation, volatility in interest rates or market disruptions on our business; • the costs and timing of future commercialization activities, including manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval; • market acceptance of our product candidates, to the extent any are approved for commercial sale, and the revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval; • the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims; • the effect of competing technological and market developments; and • the extent to which we acquire or invest in businesses, products and technologies, including entering into licensing or collaboration arrangements for product candidates. Identifying potential product candidates and conducting preclinical testing and clinical trials is a time-consuming, expensive and uncertain process that takes years to complete, and we may never generate the necessary data or results required to obtain marketing approval and achieve product sales. In addition, our product candidates, if approved, may not achieve commercial success. Our product revenue, if any, will be derived from sales of products that we do not expect to be commercially available for many years, if ever. Accordingly, we will need to obtain substantial additional funds to achieve our business objectives. Adequate additional funds may not be available to us on acceptable terms when we need them, or at all. We do not currently have any committed external source of funds, except for possible future payments from GSK under our collaborations with them. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our existing shareholders will be diluted, and the terms may include liquidation or other preferences that adversely affect the rights of our shareholders. Additional debt financing and preferred 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 and may require the issuance of warrants, which could potentially dilute our shareholders’ ownership interests. If we raise additional funds through collaborations, strategic alliances or licensing 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. 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 programs or any future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves. Recently Issued and Adopted Accounting Pronouncements For detailed information regarding recently issued and adopted accounting pronouncements and the expected impact on our consolidated financial statements, see Note 2 “Significant Accounting Policies” in the notes to the consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K. Critical Accounting Policies and Significant Judgments and Estimates Our consolidated financial statements are prepared in accordance with U.S. GAAP. The preparation of our financial statements and related disclosures requires us to make estimates and assumptions that affect the reported amount of assets, liabilities, revenue, costs and expenses and related disclosures. We believe that our revenue recognition policy, particularly (a) assessing the number of performance obligations; (b) determining the transaction price; (c) allocating the transaction price to the performance obligations in the contract; and (d) determining the pattern over which performance obligations are satisfied, including estimates to complete performance obligations, and the assumptions and estimates used in our analysis of contracts with CROs and CMOs to estimate the contract expense, involve a greater degree of judgment, and therefore we consider them to be our critical accounting policies. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions and conditions. 101 Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”). This standard applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, and financial instruments. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five-step analysis: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step analysis to contracts when it is probable that the entity will collect the consideration to which it is entitled in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract, determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. The Company has entered into collaboration agreements for research, development, and commercial services, under which the Company licenses certain rights to its product candidates to third parties. The terms of these arrangements typically include payment to the Company of one or more of the following: non-refundable, upfront license fees; prepayment or reimbursement of certain costs; customer option exercise fees; development, regulatory and commercial milestone payments; and royalties on net sales of licensed products. Any variable consideration is constrained, and therefore, the cumulative revenue associated with this consideration is not recognized until it is deemed not to be at significant risk of reversal. In determining the appropriate amount of revenue to be recognized as the Company fulfills its obligations under each of its agreements for which the collaboration partner is also a customer, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. As part of the accounting for these arrangements, the Company must use significant judgment to determine: (a) the number of performance obligations based on the determination under step (ii) above; (b) the transaction price under step (iii) above; and (c) the timing of satisfaction of performance obligations as a measure of progress in step (v) above. The Company uses significant judgment to determine whether milestones or other variable consideration, except for royalties, should be included in the transaction price as described further below. The transaction price is allocated to the optional goods and services the Company expects to provide. The Company uses estimates to determine the timing of satisfaction of performance obligations. Amounts received prior to being recognized as revenue are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current portion of deferred revenue in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Licenses of intellectual property: In assessing whether a promise or performance obligation is distinct from the other promises, the Company considers factors such as the research, development, manufacturing and commercialization capabilities of the customer and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the customer can benefit from a promise for its intended purpose without the receipt of the remaining promise, whether the value of the promise is dependent on the unsatisfied promise, whether there are other vendors that could provide the remaining promise, and whether it is separately identifiable from the remaining promise. For licenses that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Research and development services: If an arrangement is determined to contain a promise or obligation for the Company to perform research and development services, the Company must determine whether these services are distinct from other promises in the arrangement. In assessing whether the services are distinct from the other promises, the Company considers the capabilities of the customer to perform these same services. In addition, the Company considers whether the customer can benefit from a promise for its intended purpose without the receipt of the remaining promise, whether the value of the promise is dependent on the unsatisfied promise, whether there are other vendors that could provide the remaining promise, and whether it is separately identifiable from the remaining promise. For research and development services that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The 102 Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Customer options: If an arrangement is determined to contain customer options that allow the customer to acquire additional goods or services, the goods and services underlying the customer options are not considered to be performance obligations at the outset of the arrangement, as they are contingent upon option exercise. The Company evaluates the customer options for material rights, that is, the option to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the outset of the arrangement. The Company allocates the transaction price to material rights based on the standalone selling price. Amounts allocated to any material right are not recognized as revenue until the option is exercised and the performance obligation is satisfied. Milestone payments: At the inception of each arrangement that includes milestone payments, the Company evaluates whether a significant reversal of cumulative revenue provided in conjunction with achieving the milestones is probable, and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant reversal of cumulative revenue would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. For other milestones, the Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone in making this assessment. There is considerable judgment involved in determining whether it is probable that a significant reversal of cumulative revenue would not occur. At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. Royalties: For arrangements that include sales-based royalties, including milestone payments based on a level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized any royalty revenue resulting from any of its licensing arrangements. Contract costs: The Company recognizes as an asset the incremental costs of obtaining a contract with a customer if the costs are expected to be recovered. As a practical expedient, the Company recognizes the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that it otherwise would have recognized is one year or less. To date, the Company has not incurred any incremental costs of obtaining a contract with a customer. For additional discussion of accounting for collaboration revenues, see Note 5 of our consolidated financial statements. Prepaid and Accrued Research and Development Expenses As we prepare our consolidated financial statements, we are required to estimate our prepaid and accrued expenses. For certain contracts with our CROs and CMOs, if the billing terms do not align with the pattern in which the work is completed by the CRO or CMO as of the end of the period, we are required to perform an analysis to estimate the expense, for the period and to date for each contract. Contracts that are subject to this analysis generally relate to the following services: research and development services, manufacturing services, toxicology studies and clinical trial services. Once we have completed our analysis, we will record the estimated expense in the period for each contract and, depending on the invoicing activity related to each contract, we either have a prepayment or accrual as of the end of the period. We base our estimates on communications with internal study managers, our knowledge of the ongoing and past work at the CROs and CMOs, and communications and reporting from our CROs and CMOs, where applicable. 103 Item 7A. Quantitative and Qualitati ve Disclosures about Market Risk Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily the result of fluctuations in interest rates and foreign exchange rates as well as, to a lesser extent, inflation and capital market risk. Interest Rate Risk We are exposed to interest rate risk in the ordinary course of our business. Our cash and cash equivalents are comprised of funds held in checking accounts and money market accounts. Foreign Currency Risk Due to our operations outside of the United States, we are exposed to market risk related to changes in foreign currency exchange rates. Historically, we have not hedged our foreign currency exposure. Changes in the relative values of currencies occur regularly and, in some instances, could materially adversely affect our business, our financial condition, our results of operations or our cash flows. For the years ended December 31, 2024, 2023, and 2022, changes in foreign currency exchange rates did not have a material impact on our historical financial position, our business, our financial condition, our results of operations or our cash flows. Inflation Risk We do not believe that inflation had a material effect on our business, financial condition, results of operations, or cash flows in the last two years. If global inflation trends continue, we expect appreciable increases in clinical trial, labor, and other operating costs. Capital Market Risk We currently have no product revenues and depend on funds raised through other sources. One possible source of funding is through further equity offerings. Our ability to raise funds in this manner depends upon capital market forces affecting our share price, including global economic uncertainty on the capital markets. Item 8. Financial Stateme nts and Supplementary Data The information required by this Item 8 is included at the end of this Annual Report on Form 10-K beginning on page F-1. Item 9. Changes in and Disagreements with Accou ntants on Accounting and Financial Disclosure Not applicable. Item 9A. Control s and Procedures Evaluation of Disclosure Controls and Procedures Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2024. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to its management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of December 31, 2024, our principal executive officer and principal financial officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level. 104 Changes in Internal Control over Financial Reporting There were no changes in our internal control over financial reporting identified in connection with the evaluation of such internal control required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the fiscal quarter ended December 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended, as a process designed by, or under the supervision of, the company’s principal executive and principal financial officers and effected by the company’s Board, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that: • Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; • Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of management and directors of the company; and • Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2024. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework (2013). Based on our assessment, management believes that, as of December 31, 2024, our internal control over financial reporting is effective based on those criteria. The effectiveness of our internal control over financial reporting as of December 31, 2024 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report. Item 9B. Other Information Singapore Goods and Services Tax (“GST”) Rate The issue or transfer of ownership of our ordinary shares would be exempt from GST, although the sale of our ordinary shares by a GST-registered investor may be considered to be a taxable supply subject to GST at 0% if certain conditions are met. Services consisting of arranging, brokering, underwriting or advising on the issue, allotment or transfer of ownership of our ordinary shares rendered by a GST-registered person to an investor belonging in Singapore for GST purposes in connection with the investor’s purchase, sale or holding of our ordinary shares will be subject to GST at the prevailing standard rate of 9%. Similar services rendered by a GST-registered person contractually to an investor belonging outside Singapore and for the direct benefit of an investor belonging outside Singapore or a GST-registered person in Singapore should generally, subject to the satisfaction of certain conditions, be subject to GST at 0%. Rule 10b5-1 Trading Plans During the three months ended December 31, 2024, certain of our officers (as defined in Rule 16a-1(f) of the Exchange Act) entered into contracts, instructions or written plans (each, a “Rule 10b5-1 Trading Plan” and collectively, the “Rule 10b5-1 Trading Plans”) for the purchase or sale of our securities that are intended to satisfy the conditions specified in Rule 10b5-1(c) under the Exchange Act for an affirmative defense against liability for trading in securities on the basis of material nonpublic information. We describe the material terms of these Rule 10b5-1 Trading Plans below. On November 24, 2024 , Christian Henry , MBA, Chairman of our Board , adopted a Rule 10b5-1 Trading Plan providing for the sale of up to an aggregate of 105,670 of our ordinary shares pursuant to the terms of such Rule 10b5-1 Trading Plan. Mr. Henry’s Rule 105 10b5-1 Trading Plan is active until August 29, 2025 , or earlier, if and when all transactions under the Rule 10b5-1 Trading Plan are completed. On November 25, 2024 , Kyle Moran , CFA, our Chief Financial Officer , adopted a Rule 10b5-1 Trading Plan providing for the sale of up to an aggregate of 196,000 of our ordinary shares pursuant to the terms of such Rule 10b5-1 Trading Plan. Mr. Moran’s Rule 10b5-1 Trading Plan is active until June 30, 2025 , or earlier, if and when all transactions under the Rule 10b5-1 Trading Plan are completed. On November 25, 2024 , Christopher Francis , Ph.D., our Senior Vice President , Corporate Development, Head of Emerging Areas, adopted a Rule 10b5-1 Trading Plan providing for the sale of up to an aggregate of 435,564 of our ordinary shares pursuant to the terms of such Rule 10b5-1 Trading Plan. Dr. Francis' Rule 10b5-1 Trading Plan is active until November 3, 2025 , or earlier, if and when all transactions under the Rule 10b5-1 Trading Plan are completed. On November 25, 2024 , Chandra Vargeese , Ph.D., our Chief Technology Officer , Head of Platform Discovery Sciences, adopted a Rule 10b5-1 Trading Plan providing for the sale of up to an aggregate of 86,972 of our ordinary shares pursuant to the terms of such Rule 10b5-1 Trading Plan. Dr. Vargeese's Rule 10b5-1 Trading Plan is active until August 31, 2025, or earlier, if and when all transactions under the Rule 10b5-1 Trading Plan are completed. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 106 PART III Item 10. Directors, Executive Off icers and Corporate Governance Information required by this item will be contained in our definitive proxy statement to be filed with the SEC on Schedule 14A in connection with our 2025 Annual General Meeting of Shareholders, (the "Proxy Statement"), if the Proxy Statement is filed not later than 120 days after the end of our fiscal year ended December 31, 2024, in the sections titled “Management and Corporate Governance,” and “Code of Business Conduct and Ethics,” and is incorporated herein by reference. If the Proxy Statement is not filed within such 120-day period, the information required by this item will be contained in an amendment to this Annual Report on Form 10-K to be filed with the SEC (the "Form 10-K/A"). Item 11. Executi ve Compensation The information required by this item is incorporated by reference to the information set forth in the section titled “Executive Officer and Director Compensation” in our Proxy Statement. The section entitled “Pay Versus Performance” in our Proxy Statement is not incorporated by reference herein. If the Proxy Statement is not filed within 120 days after the end of our fiscal year ended December 31, 2024, the information required by this item will be contained in the Form 10-K/A. Item 12. Security Ownership of Certain Beneficial Ow ners and Management and Related Stockholder Matters The information required by this item is incorporated by reference to the information set forth in the sections titled “Security Ownership of Certain Beneficial Owners and Management” and “Equity Compensation Plan Information” in our Proxy Statement. If the Proxy Statement is not filed within 120 days after the end of our fiscal year ended December 31, 2024, the information required by this item will be contained in the Form 10-K/A. Item 13. Certain Relationships and Relate d Transactions, and Director Independence The information required by this item is incorporated by reference to the information set forth in the sections titled “Certain Relationships and Related Person Transactions” and “Management and Corporate Governance – Director Independence” in our Proxy Statement. If the Proxy Statement is not filed within 120 days after the end of our fiscal year ended December 31, 2024, the information required by this item will be contained in the Form 10-K/A. Item 14. Principal Accou ntant Fees and Services The information required by this item regarding principal accountant fees and services is incorporated by reference to the information set forth in the sections titled “Principal Accountant Fees and Services” and “Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Public Accounting Firm” in our Proxy Statement. If the Proxy Statement is not filed within 120 days after the end of our fiscal year ended December 31, 2024, the information required by this item will be contained in the Form 10-K/A. Our independent registered public accounting firm is KPMG LLP, Boston, MA, Auditor Firm ID: 185 . 107 PART IV Item 15. Exhibits and Financ ial Statement Schedules (a) The following documents are filed as part of this report: 1. Financial Statements See Index to Consolidated Financial Statements on page 108 of this Annual Report on Form 10-K. 2. Financial Statement Schedules All schedules are omitted because they are not applicable, or the required information is shown in the financial statements or notes thereto. 3. Exhibits The following is a list of exhibits filed as part of this Annual Report on Form 10-K. Exhibit Number Exhibit Description Filed with this Report Incorporated by Reference herein from Form or Schedule Filing Date SEC File/Reg. Number 3.1 Constitution (formerly known as Memorandum of Association and Articles of Association) Amendment No. 5 to Form S-1 (Exhibit 3.2) 11/10/2015 333-207379 4.1 Form of Specimen Ordinary Share Certificate Amendment No. 3 to Form S-1 (Exhibit 4.1) 11/06/2015 333-207379 4.2 Description of Securities of the Registrant and Comparison of Shareholder Rights X 4.3.1 Form of Pre-Funded Warrant (2022) Form 8-K (Exhibit 4.1) 06/14/2022 001-37627 4.3.2 Form of Pre-Funded Warrant (2024) Form 8-K (Exhibit 4.1) 9/26/2024 001-37627 4.4 Share Purchase Agreement by and between the Registrant and C.P. Pharmaceuticals International C.V., dated as of May 5, 2016 Form 10-Q (Exhibit 10.2) 08/15/2016 001-37627 Lease Agreements 10.1.1 Lease Agreement by and between Wave Life Sciences USA, Inc., the Registrant, and King 733 Concord LLC, dated as of April 6, 2015 Form S-1 (Exhibit 10.7) 10/09/2015 333-207379 10.1.2 First Amendment (to Lease) by and between Wave Life Sciences USA, Inc. and CPI/King 733 Concord Owner, LLC, dated as of December 9, 2020 Form 10-K (Exhibit 10.5.2) 03/04/2021 001-37627 10.1.3 Second Amendment (to Lease) by and between Wave Life Sciences USA, Inc. and CPI/King 733 Concord Owner, LLC, dated as of August 8, 2022 Form 10-Q (Exhibit 10.1) 08/11/2022 001-37627 10.2.1 Lease Agreement by and between Wave Life Sciences USA, Inc. and King 115 Hartwell LLC, dated as of September 26, 2016 Form 8-K (Exhibit 10.1) 01/06/2017 001-37627 108 10.2.2 First Amendment (to Lease) by and between Wave Life Sciences USA, Inc. and King 115 Hartwell LLC, dated as of December 31, 2016 Form 8-K (Exhibit 10.1) 01/06/2017 001-37627 Collaboration and License Agreements 10.3†† Collaboration and License Agreement by and between Wave Life Sciences USA, Inc., Wave Life Sciences UK Limited and GlaxoSmithKline Intellectual Property (No. 3), dated as of December 13, 2022 Form 10-K (Exhibit 10.3) 03/23/2023 001-37627 10.4 Share Purchase Agreement by and between Glaxo Group Limited and the Registrant, dated as of December 13, 2022 Form 10-K (Exhibit 10.4) 03/23/2023 001-37627 10.5 Investor Agreement by and between Glaxo Group Limited and the Registrant, dated as of January 26, 2023 Form 10-K (Exhibit 10.5) 03/23/2023 001-37627 Agreements with Executive Officers and Directors 10.6+ Form of Deed of Indemnity by and between the Registrant and each of its directors and certain of its officers Form S-1 (Exhibit 10.11) 10/09/2015 333-207379 10.7+ Employment Agreement, as amended and restated, between the Registrant and Paul B. Bolno, dated as of May 8, 2020 Form 10-Q (Exhibit 10.1) 08/10/2020 333-207379 10.8+ Employment Agreement, as amended and restated, between the Registrant and Chandra Vargeese, dated as of May 8, 2020 Form 10-Q (Exhibit 10.2) 08/10/2020 333-207379 10.9+ Employment Agreement between the Registrant and Christopher Francis, Ph.D., dated as of November 8, 2022 Form 10-K (Exhibit 10.12) 03/23/2023 001-37627 10.10+ Employment Agreement, as amended and restated, between the Registrant and Kyle Moran, dated as of January 1, 2021 Form 10-K (Exhibit 10.15) 03/04/2021 001-37627 10.11+ Non-Employee Director Compensation Policy, as amended, effective as of August 6, 2024 Form 10-Q (Exhibit 10.2+) 11/12/2024 001-37627 10.12+ Consulting Agreement by and between Ontorii, Inc. (now Wave Life Sciences USA, Inc.) and Gregory Verdine, dated as of April 1, 2012 Form S-1 (Exhibit 10.16) 10/09/2015 333-207379 Equity and Other Compensation Plans 10.13+ Wave Life Sciences Ltd. 2014 Equity Incentive Plan, as amended (the “2014 Equity Plan”) Form 10-Q (Exhibit 10.1) 11/09/2017 001-37627 10.14+ Wave Life Sciences Ltd. 2021 Equity Plan, as amended, (the “2021 Equity Plan”) effective August 6, 2024 Form 8-K (Exhibit 10.1) 08/12/2024 001-37627 10.15+ Wave Life Sciences Ltd. 2019 Employee Share Purchase Plan, as amended, effective as of August 1, 2023 Form 8-K (Exhibit 10.2) 08/07/2023 001-37627 10.16.1+ Form of Non-qualified Share Option Agreement under the 2014 Equity Plan, effective as of September 20, 2016 Form 10-Q (Exhibit 10.2) 11/09/2017 001-37627 109 10.16.2+ Form of Non-qualified Share Option Agreement under the 2014 Equity Plan, effective as of January 1, 2018 Form 10-K (Exhibit 10.23.3) 03/01/2019 001-37627 10.16.3+ Form of Non-qualified Share Option Agreement under the 2021 Equity Plan, effective as August 10, 2021 Form 10-K (Exhibit 10.3) 11/10/2021 001-37627 10.17.1+ Form of Incentive Share Option Agreement under the 2014 Equity Plan, effective as of December 2014 Form S-8 (Exhibit 10.1) 12/17/2015 333-208598 10.17.2+ Form of Incentive Share Option Agreement under the 2014 Equity Plan, effective as of September 20, 2016 Form 10-Q (Exhibit 10.3) 11/09/2017 001-37627 10.18.1+ Form of Restricted Share Unit Agreement under the 2014 Equity Plan, effective as of June 16, 2016 Form 10-Q (Exhibit 10.4) 11/09/2017 001-37627 10.18.2+ Form of Restricted Share Unit Agreement under the 2014 Equity Plan, effective as of January 1, 2018 Form 10-K (Exhibit 10.25.2) 03/01/2019 001-37627 10.18.3+ Form of Restricted Share Unit Agreement under the 2014 Equity Incentive Plan, effective as of January 1, 2019 Form 10-Q (Exhibit 10.1) 05/10/2019 001-37627 10.18.4+ Form of Restricted Share Unit Agreement under the 2021 Equity Plan, effective as of August 10, 2021 Form 10-Q (Exhibit 10.4) 11/10/2021 001-37627 10.18.5+ Form of Amended and Restated 2019 Performance-Based Restricted Share Unit Agreement under the 2014 Equity Incentive Plan, effective as of March 17, 2021 Form 10-Q (Exhibit 10.2) 05/13/2021 001-37627 10.18.6+ Form of 2021 Performance-Based Restricted Share Unit Agreement under the 2014 Equity Incentive Plan, effective as of March 17, 2021 Form 10-Q (Exhibit 10.3) 05/13/2021 001-37627 10.19.1+ Form of Non-qualified Share Option Agreement for UK Participants under the 2014 Equity Plan, effective as of June 21, 2017 Form 10-Q (Exhibit 10.5) 11/09/2017 001-37627 10.19.2+ Form of Non-qualified Share Option Agreement for UK Participants under the 2014 Equity Plan, effective as of January 1, 2018 Form 10-K (Exhibit 10.26.2) 03/01/2019 001-37627 10.19.3+ Form of Non-qualified Share Option Agreement for UK Participants under the 2021 Equity Plan, effective as of August 10, 2021 Form 10-Q (Exhibit 10.5) 11/10/2021 001-37627 10.19.4+ Form of Restricted Share Unit Agreement for UK Participants under the 2021 Equity Plan, effective as of August 10, 2021 Form 10-Q (Exhibit 10.6) 11/10/2021 001-37627 10.20.1+ Form of Inducement Non-qualified Share Option Agreement, effective May 2024 Form 10-Q (Exhibit 10.1) 08/08/2024 001-37627 10.20.2+ Form of Inducement Restricted Share Unit Agreement, effective May 2024 Form 10-Q (Exhibit 10.2) 08/08/2024 001-37627 110 10.21.1 Open Market Sale Agreement, dated as of May 10, 2019, by and between the Registrant and Jefferies LLC Form S-3ASR (Exhibit 1.2) 05/10/2019 333-231382 10.21.2 Amendment No. 1 to Open Market Sale Agreement, dated as of March 2, 2020, by and between the Registrant and Jefferies LLC POSASR (Exhibit 1.3) 03/02/2020 333-231382 10.21.3 Amendment No. 2, dated March 3, 2022, to the Open Market Sale Agreement, dated as of May 10, 2019, by and between Wave Life Sciences Ltd. and Jefferies LLC Form 8-K (Exhibit 10.1) 03/03/2022 001-37627 10.21.4 Amendment No. 3, dated November 12, 2024, to the Open Market Sale Agreement, dated as of May 10, 2019, by and between Wave Life Sciences Ltd. and Jefferies LLC Form 10-Q (Exhibit 10.1) 11/12/2024 001-37627 19.1 Insider Trading Policy X 21.1 List of Subsidiaries of the Registrant Form 10-K (Exhibit 21.1) 03/12/2018 001-37627 23.1 Consent of Independent Registered Public Accounting Firm X 24.1 Power of Attorney (included on signature page to this Annual Report on Form 10-K) X 31.1 Certifications of Principal Executive Officer pursuant to Rule 13a-14(a) X 31.2 Certifications of Principal Financial Officer pursuant to Rule 13a-14(a) X 32* Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by Principal Executive Officer and Principal Financial Officer X 97.1 Clawback Policy, effective as of October 2, 2023 Form 10-K (Exhibit 97.1) 03/06/2024 001-37627 101.INS XBRL Instance Document – T he Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document X 101.SCH Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents X 104 The cover page for this Annual Report on Form 10-K for the year ended December 31, 2024 is contained in Exhibit 101 and has been formatted in Inline XBRL X (*) The certification attached as Exhibit 32 that accompanies this Annual Report on Form 10-K is not deemed filed with the SEC and is not to be incorporated by reference into any filing of Wave Life Sciences Ltd. under the Securities Act of 1933, as amended, or the 111 Securities Exchange Act of 1934, as amended, whether made before or after the date of this Form 10-K, irrespective of any general incorporation language contained in such filing. (+) Indicates management contract or compensatory plan or arrangement. (†) Confidential treatment has been granted with respect to certain portions of this exhibit. Omitted portions have been filed separately with the SEC. (††) Certain confidential portions of this Exhibit were omitted by means of marking such portions with brackets (“[***]”) because the identified confidential portions (i) are not material and (ii) is the type that the Registrant treats as private or confidential. Item 16. Form 10-K Summary None. 112 SIGNAT URES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. Wave Life Sciences Ltd. Date: March 4, 2025 By: /s/ Paul B. Bolno, M.D. Paul B. Bolno, M.D. President and Chief Executive Officer POWER OF ATTORNEY Each person whose individual signature appears below hereby authorizes and appoints Paul B. Bolno, M.D. with full power of substitution and resubstitution and full power to act, as his or her true and lawful attorney-in-fact and agent to act in his or her name, place and stead and to execute in the name and on behalf of each person, individually and in each capacity stated below, and to file any and all amendments to this Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and perform each and every act and thing, ratifying and confirming all that said attorney-in-fact and agent or his substitute or substitutes may lawfully do or cause to be done by virtue thereof. Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Paul B. Bolno, M.D. Paul B. Bolno, M.D. President, Chief Executive Officer and Director ( principal executive officer ) March 4, 2025 /s/ Kyle Moran Kyle Moran Chief Financial Officer ( principal financial officer and principal accounting officer ) March 4, 2025 /s/ Christian Henry Christian Henry Chairman of the Board of Directors March 4, 2025 /s/ Gregory L. Verdine, Ph.D. Gregory L. Verdine, Ph.D. Director March 4, 2025 /s/ Peter Kolchinsky, Ph.D. Peter Kolchinsky, Ph.D. Director March 4, 2025 /s/ Aik-Na Tan Aik-Na Tan Director March 4, 2025 /s/ Adrian Rawcliffe Adrian Rawcliffe Director March 4, 2025 /s/ Ken Takanashi Ken Takanashi Director March 4, 2025 /s/ Mark H. N. Corrigan, M.D. Mark H. N. Corrigan, M.D. Director March 4, 2025 /s/ Heidi L. Wagner Heidi L. Wagner Director March 4, 2025 113 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm F- 1 Consolidated Balance Sheets F- 3 Consolidated Statements of Operations and Comprehensive Loss F- 4 Consolidated Statements of Series A Preferred Shares and Shareholders’ Equity (Deficit) F- 5 Consolidated Statements of Cash Flows F- 6 Notes to Consolidated Financial Statements F- 7 114 Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors Wave Life Sciences Ltd.: Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting We have audited the accompanying consolidated balance sheets of Wave Life Sciences Ltd. and subsidiaries (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive loss, Series A preferred shares and shareholders’ equity (deficit), and cash flows for the each of the years in the three-year period ended December 31, 2024, and the related notes (collectively, the consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024 based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Basis for Opinions The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Annual Report on Internal Controls over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. F- 1 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Evaluation of revenue recognition for certain research and development services As discussed in Note 5 to the consolidated financial statements, the Company is party to a collaboration agreement with GlaxoSmithKline (GSK) which has two performance obligations, including the promise to provide research and development (R&D) services. The Company recognizes R&D services revenue over time using an input method. This method measures progress based on costs incurred in relation to the R&D activities and the costs expected to be incurred in the future to satisfy each performance obligation. Amounts received by the Company before performance are recorded as deferred revenue. For the year ended December 31, 2024, the Company recognized over-time revenue under the GSK collaboration agreement of $37.0 million. In addition, as of December 31, 2024, a portion of the Company’s current and long-term deferred revenue relates to R&D services. We identified the evaluation of revenue recognition for certain R&D services as a critical audit matter. Specifically, evaluating the estimate of total costs expected to be incurred in satisfying certain R&D performance obligations required especially challenging auditor judgment. This involved an assessment of the nature of work to be performed and the method for measuring progress. The following are the primary procedures we performed to address this critical audit matter. For a selection of R&D performance obligations, we read the underlying contract with the customer, evaluated the determination of the method for measuring progress, and tested the Company’s estimate of total contract costs to be incurred by (1) comparing the Company’s initial estimates to actual costs incurred to assess the Company’s ability to estimate accurately, (2) inspecting underlying documentation and third-party evidence and comparing them to management’s assumptions and inputs, (3) inquiring of R&D personnel of the Company to evaluate factors related to the nature of the work to be performed and their impact on the total contract costs to be incurred, including progress to date and the estimate of remaining contract costs, and (4) assessing the Company’s history of estimating costs to be incurred in satisfying R&D performance obligations under similar contracts. /s/ KPMG LLP We have served as the Company’s auditor since 2015. Boston, Massachusetts March 4, 2025 F- 2 WAVE LIFE SCIENCES LTD. CONSOLIDATED BALANCE SHEETS (In thousands, except share amounts) December 31, 2024 December 31, 2023 Assets Current assets: Cash and cash equivalents $ 302,078 $ 200,351 Accounts receivable 1,422 21,086 Prepaid expenses 9,544 9,912 Other current assets 7,350 4,024 Total current assets 320,394 235,373 Long-term assets: Property and equipment, net of accumulated depreciation of $ 46,329 and $ 42,709 as of December 31, 2024 and 2023, respectively 10,128 13,084 Operating lease right-of-use assets 17,870 22,637 Restricted cash 3,760 3,699 Other assets 55 156 Total long-term assets 31,813 39,576 Total assets $ 352,207 $ 274,949 Liabilities, Series A preferred shares and shareholders’ equity Current liabilities: Accounts payable $ 16,262 $ 12,839 Accrued expenses and other current liabilities 21,081 16,828 Current portion of deferred revenue 65,972 150,059 Current portion of operating lease liability 7,638 6,714 Total current liabilities 110,953 186,440 Long-term liabilities: Deferred revenue, net of current portion 6,099 15,601 Operating lease liability, net of current portion 17,766 25,404 Total long-term liabilities 23,865 41,005 Total liabilities $ 134,818 $ 227,445 Series A preferred shares, no par value; 3,901,348 shares issued and outstanding at December 31, 2024 and 2023 $ 7,874 $ 7,874 Shareholders’ equity: Ordinary shares, no par value; 153,037,286 and 119,162,234 shares issued and outstanding at December 31, 2024 and 2023, respectively $ 1,175,181 $ 935,367 Additional paid-in capital 156,454 129,237 Accumulated other comprehensive loss ( 262 ) ( 124 ) Accumulated deficit ( 1,121,858 ) ( 1,024,850 ) Total shareholders’ equity 209,515 39,630 Total liabilities, Series A preferred shares and shareholders’ equity $ 352,207 $ 274,949 The accompanying notes are an integral part of the consolidated financial statements. F- 3 WAVE LIFE SCIENCES LTD. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (In thousands, except share and per share amounts) For the Year Ended December 31, 2024 2023 2022 Revenue $ 108,302 $ 113,305 $ 3,649 Operating expenses: Research and development 159,682 130,009 115,856 General and administrative 59,023 51,292 50,513 Total operating expenses 218,705 181,301 166,369 Loss from operations ( 110,403 ) ( 67,996 ) ( 162,720 ) Other income, net: Dividend income and interest income, net 10,163 7,928 1,571 Other income, net 3,232 1,878 7 Total other income, net 13,395 9,806 1,578 Loss before income taxes ( 97,008 ) ( 58,190 ) ( 161,142 ) Income tax benefit (provision) — 677 ( 681 ) Net loss $ ( 97,008 ) $ ( 57,513 ) $ ( 161,823 ) Net loss per share attributable to ordinary shareholders—basic and diluted $ ( 0.70 ) $ ( 0.54 ) $ ( 2.05 ) Weighted-average ordinary shares used in computing net loss per share attributable to ordinary shareholders—basic and diluted 138,277,468 106,097,268 78,855,810 Other comprehensive loss: Net loss $ ( 97,008 ) $ ( 57,513 ) $ ( 161,823 ) Foreign currency translation ( 138 ) ( 95 ) ( 210 ) Comprehensive loss ( 97,146 ) ( 57,608 ) ( 162,033 ) The accompanying notes are an integral part of the consolidated financial statements. F- 4 WAVE LIFE SCIENCES LTD. CONSOLIDATED STATEMENTS OF SERIES A PREFERRED SHARES AND SHAREHOLDERS’ EQUITY (DEFICIT) (In thousands, except share amounts) Series A Preferred Shares Ordinary Shares Additional Accumulated Other Total Shares Amount Shares Amount Paid-In- Capital Comprehensive Income (Loss) Accumulated Deficit Shareholders’ Equity (Deficit) Balance at December 31, 2021 3,901,348 $ 7,874 59,841,116 $ 749,851 $ 87,980 $ 181 $ ( 805,514 ) $ 32,498 Issuance of ordinary shares, net of offering costs — — 25,464,483 51,220 — — — 51,220 Issuance of ordinary shares pursuant to the at-the-market equity program, net — — 458,092 1,167 — — — 1,167 Issuance of pre-funded warrants, net of offering costs — — — — 14,268 — — 14,268 Share-based compensation — — — — 17,194 — — 17,194 Vesting of RSUs — — 904,891 — — — — — Option exercises — — 90,000 223 — — — 223 Issuance of ordinary shares under the ESPP — — 166,061 372 — — — 372 Other comprehensive loss — — — — — ( 210 ) — ( 210 ) Net loss — — — — — — ( 161,823 ) ( 161,823 ) Balance at December 31, 2022 3,901,348 $ 7,874 86,924,643 $ 802,833 $ 119,442 $ ( 29 ) $ ( 967,337 ) $ ( 45,091 ) Issuance of ordinary shares, net of offering costs — — 20,000,000 93,574 — — — 93,574 Issuance of ordinary shares, pursuant to the GSK Collaboration Agreement — — 10,683,761 34,623 — — — 34,623 Issuance of ordinary shares pursuant to the at-the-market equity program, net — — 751,688 3,080 — — — 3,080 Share-based compensation — — — — 9,795 — — 9,795 Vesting of RSUs — — 415,658 — — — — — Option exercises — — 160,571 509 — — — 509 Issuance of ordinary shares under the ESPP — — 225,913 748 — — — 748 Other comprehensive loss — — — — — ( 95 ) — ( 95 ) Net loss — — — — — — ( 57,513 ) ( 57,513 ) Balance at December 31, 2023 3,901,348 $ 7,874 119,162,234 $ 935,367 $ 129,237 $ ( 124 ) $ ( 1,024,850 ) $ 39,630 Issuance of ordinary shares, net of offering costs — — 29,875,001 215,796 — — — 215,796 Issuance of ordinary shares pursuant to the at-the-market equity program, net — — 2,952,591 20,380 — — — 20,380 Issuance of pre-funded warrants, net of offering costs — — — — 14,076 — — 14,076 Share-based compensation — — — — 13,141 — — 13,141 Vesting of RSUs — — 100,326 — — — — — Option exercises — — 770,636 2,979 — — — 2,979 Issuance of ordinary shares under the ESPP — — 176,498 659 — — — 659 Other comprehensive loss — — — — — ( 138 ) — ( 138 ) Net loss — — — — — — ( 97,008 ) ( 97,008 ) Balance at December 31, 2024 3,901,348 $ 7,874 153,037,286 $ 1,175,181 $ 156,454 $ ( 262 ) $ ( 1,121,858 ) $ 209,515 The accompanying notes are an integral part of the consolidated financial statements. F- 5 WAVE LIFE SCIENCES LTD. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) For the Year Ended December 31, 2024 2023 2022 Cash flows from operating activities Net loss $ ( 97,008 ) $ ( 57,513 ) $ ( 161,823 ) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Amortization of right-of-use assets 4,767 4,206 3,540 Depreciation of property and equipment 3,896 5,000 6,574 Share-based compensation expense 13,141 9,795 17,194 Loss on disposal of property and equipment — — 12 Changes in operating assets and liabilities: Accounts receivable 19,664 ( 21,086 ) — Prepaid expenses 368 ( 1,980 ) ( 1,348 ) Other assets ( 3,225 ) ( 2,010 ) 3,394 Accounts payable 3,421 ( 3,761 ) 9,348 Accrued expenses and other current liabilities 4,253 ( 724 ) 2,691 Deferred revenue ( 93,589 ) 54,328 ( 3,245 ) Operating lease liabilities ( 6,714 ) ( 5,496 ) ( 4,308 ) Other non-current liabilities — ( 190 ) 190 Net cash used in operating activities ( 151,026 ) ( 19,431 ) ( 127,781 ) Cash flows from investing activities Purchases of property and equipment ( 938 ) ( 1,115 ) ( 1,361 ) Proceeds from the sale of property and equipment — — 106 Purchase of short-term investments — — ( 75,044 ) Proceeds from the maturity of short-term investments — — 75,044 Net cash used in investing activities ( 938 ) ( 1,115 ) ( 1,255 ) Cash flows from financing activities Proceeds from the issuance of ordinary shares as a part of the June 2022 Offering, net of offering costs — — 51,220 Proceeds from the issuance of ordinary shares as a part of the December 2023 Offering, net of offering costs 14,038 93,574 — Proceeds from the issuance of ordinary shares as a part of the September 2024 Offering, net of offering costs 201,758 — — Proceeds from issuance pre-funded warrants as a part of the June 2022 Offering, net of offering costs — — 14,268 Proceeds from issuance pre-funded warrants as a part of the, September 2024 Offering, net of offering costs 14,076 — — Proceeds from issuance of ordinary shares pursuant to the GSK Collaboration Agreement — 34,623 — Proceeds from issuance of ordinary shares pursuant to the at-the-market equity program, net 20,380 3,080 1,105 Proceeds from the exercise of share options 2,979 509 223 Proceeds from the ESPP 659 748 372 Net cash provided by financing activities 253,890 132,534 67,188 Effect of foreign exchange rates on cash ( 138 ) ( 95 ) ( 210 ) Net increase (decrease) in cash, cash equivalents and restricted cash 101,788 111,893 ( 62,058 ) Cash, cash equivalents and restricted cash, beginning of period 204,050 92,157 154,215 Cash, cash equivalents and restricted cash, end of period $ 305,838 $ 204,050 $ 92,157 Supplemental disclosure of cash flow information: Offering costs in accounts payable at period end $ — $ 210 $ — Increase in operating lease right-of-use assets and lease liabilities related to new lease $ — $ — $ 12,006 The accompanying notes are an integral part of the consolidated financial statements. F- 6 Wave Life Sciences Ltd. Notes to Consolidated Financial Statements 1. THE COMPANY Organization Wave Life Sciences Ltd. (together with its subsidiaries, “Wave” or the “Company”) is a clinical-stage biotechnology company focused on unlocking the broad potential of RNA medicines (also known as oligonucleotides), or those targeting RNA, to transform human health. Wave’s RNA medicines platform, PRISM, combines multiple modalities, chemistry innovation and deep insights into human genetics to deliver scientific breakthroughs that treat both rare and common disorders. The Company’s toolkit of RNA-targeting modalities includes RNA editing, splicing, silencing using siRNA and antisense silencing, providing us with unique capabilities for designing and sustainably delivering candidates that optimally address disease biology. The Company’s diversified pipeline includes clinical programs in obesity, AATD, DMD, and HD, as well as several preclinical programs utilizing our versatile RNA medicines platform. The Company was incorporated in Singapore on July 23, 2012 and has its principal U.S. office in Cambridge, Massachusetts. The Company was incorporated with the purpose of combining two commonly held companies, Wave Life Sciences USA, Inc. (“Wave USA”), a Delaware corporation (formerly Ontorii, Inc.), and Wave Life Sciences Japan, Inc. (“Wave Japan”), a company organized under the laws of Japan (formerly Chiralgen., Ltd.), which occurred on September 13, 2012. On May 31, 2016, Wave Life Sciences Ireland Limited (“Wave Ireland”) was formed as a wholly - owned subsidiary of Wave Life Sciences Ltd. On April 3, 2017, Wave Life Sciences UK Limited (“Wave UK”) was formed as a wholly - owned subsidiary of Wave Life Sciences Ltd. The Company’s primary activities have been developing and evolving PRISM to design, develop and commercialize RNA medicines, advancing the Company’s differentiated portfolio, building the Company’s research, development and manufacturing capabilities, advancing programs into the clinic, furthering clinical development of such clinical-stage programs, building the Company’s intellectual property, and assuring adequate capital to support these activities. Liquidity Since its inception, the Company has not generated any product revenue and has incurred recurring operating losses. To date, the Company has primarily funded its operations through private placements of debt and equity securities, public and other registered offerings of its equity securities and collaborations with third parties. Until the Company can generate significant revenue from product sales, if ever, the Company expects to continue to finance operations through a combination of public or private equity or debt financings or other sources, which may include upfront and milestone payments from collaborations with third parties. Adequate additional financing may not be available to the Company on acceptable terms, or at all. The inability to raise capital as and when needed would have a negative impact on the Company’s financial condition and ability to pursue its business strategy. As of December 31, 2024, the Company had cash and cash equivalents of $ 302.1 million. The Company expects that its existing cash and cash equivalents will be sufficient to fund its operations for at least the next twelve months. The Company has based this expectation on the best information available, however the Company may use its available capital resources sooner than it currently expects. If the Company’s anticipated operating results are not achieved in future periods, planned expenditures may need to be further reduced in order to extend the time period over which the then-available resources would be able to fund the Company’s operations. In addition, the Company may elect to raise additional funds before it needs them if the conditions for raising capital are favorable due to market conditions or strategic considerations, even if the Company expects it has sufficient funds for its current or future operating plans. F- 7 Risks and Uncertainties The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, new technological innovations, protection of proprietary technology, maintaining internal manufacturing capabilities, dependence on key personnel, compliance with government regulations and the need to obtain additional financing. The Company’s therapeutic programs will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval, prior to commercialization of any product candidates. These efforts require significant amounts of additional capital, adequate personnel infrastructure and extensive compliance-reporting capabilities. There can be no assurance that the Company’s research and development efforts will be successful, that adequate protection for the Company’s intellectual property will be obtained, that any products developed will obtain necessary government regulatory approval or that any approved products will be commercially viable. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will generate significant revenue from product sales. The Company operates in an environment of rapid change in technology and substantial competition from pharmaceutical and biotechnology companies. Basis of Presentation The Company has prepared the accompanying consolidated financial statements in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) and in U.S. dollars. 2. SIGNIFICANT ACCOUNTING POLICIES Cash and Cash Equivalents The Company considers all highly liquid securities with maturities of three months or less from the date of purchase to be cash equivalents. The Company's cash and cash equivalents are comprised of funds held in checking and money market accounts. Principles of Consolidation The Company’s consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The Company’s consolidated financial statements are prepared in accordance with U.S. GAAP. The preparation of the Company’s financial statements and related disclosures requires the Company to make estimates and assumptions that affect the reported amount of assets, liabilities, revenue, costs and expenses and related disclosures. Management considers many factors in selecting appropriate financial accounting policies and in developing the estimates and assumptions that are used in the preparation of the financial statements. Management must apply significant judgment in this process. The Company believes that its revenue recognition policy, particularly (a) assessing the number of performance obligations; (b) determining the transaction price; (c) allocating the transaction price to the performance obligations in the contract; and (d) determining the pattern over which performance obligations are satisfied, including estimates to complete performance obligations, and the assumptions and estimates used in the Company’s analysis of contracts with contract research organizations (“CROs”) and contract manufacturing organizations (“CMOs”) to estimate the contract expense, involve a greater degree of judgment, and therefore the Company considers them to be its critical accounting policies. The Company evaluates its estimates and assumptions on an ongoing basis. The Company’s actual results may differ from these estimates under different assumptions and conditions. Segment Data The Company manages its operations as a single reportable and operating segment for the purposes of assessing performance and making operating decisions. The Company’s focus is on developing its proprietary RNA medicines platform, PRISM, to develop and commercialize a broad pipeline of RNA medicines in a variety of therapeutic areas. This operating structure enables the Chief Executive Officer ("CEO") as chief operating decision maker ("CODM"), to allocate resources and assess business performance in order to achieve established long-term strategic goals. The determination of a single segment is consistent with the consolidated financial information regularly reviewed by the CODM for purposes of assessing performance, allocating resources and planning, monitoring budget versus actual results, and forecasting future periods. Within the single segment, there are significant expenses that are regularly considered by the CODM which are used in the review for performance and resource allocation. See Note 14 for additional disclosure of our segment information. F- 8 Going Concern At each reporting period, the Company evaluates whether there are conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The Company is required to make certain additional disclosures if the Company concludes substantial doubt exists and it is not alleviated by the Company’s plans or when the Company’s plans alleviate substantial doubt about the Company’s ability to continue as a going concern. The Company’s evaluation entails analyzing prospective operating budgets and forecasts for expectations of the Company’s cash needs and comparing those needs to the current cash and cash equivalent balance. Foreign Currency Translation The functional currency is the U.S. dollar for all of the Company’s entities aside from Wave Japan, which has the Japanese Yen as its functional currency. Assets and liabilities of Wave Japan are translated at period end exchange rates while revenues and expenses of Wave Japan are translated at average exchange rates for the period. Net unrealized gains and losses from foreign currency translation are reflected as other comprehensive income (loss) within the consolidated statements of Series A preferred shares and shareholders’ equity (deficit) and the consolidated statements of operations and comprehensive loss. Gains and losses on foreign currency transactions are included in the consolidated statements of operations and comprehensive loss within other income, net. Fair Value of Financial Instruments The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. The fair value hierarchy is a hierarchy of inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the financial instrument based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the financial instrument and are developed based on the information available in the circumstances. The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality. The hierarchy defines three levels of valuation inputs: Level 1—Unadjusted quoted prices in active markets that are accessible at the measurement date of identical, unrestricted assets. Level 2—Quoted prices for similar assets, or inputs that are observable, either directly or indirectly, for substantially the full term through corroboration with observable market data. Level 2 includes investments valued at quoted prices adjusted for legal or contractual restrictions specific to the security. Level 3—Pricing inputs are unobservable for the asset, that is, inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset. Level 3 includes private investments that are supported by little or no market activity. Cash, cash equivalents and restricted cash are Level 1 assets which are comprised of funds held in checking and money market accounts. Cash, cash equivalents and restricted cash were recorded at fair value as of December 31, 2024 and 2023, totaling $ 305.8 million and $ 204.1 million, respectively. The carrying amounts of accounts payable and accrued expenses approximate their fair values due to their short-term maturities. Concentration of Credit Risk Cash, cash equivalents, restricted cash and short-term investments are financial instruments that potentially subject the Company to concentration of credit risk. The Company uses several financial institutions to maintain its cash, cash equivalents, restricted cash and short-term investments, all of which are high quality, accredited financial institutions and, accordingly, such funds are subject to minimal credit risk. The Company has not experienced any losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. The Company has no financial instruments with off-balance sheet risk of loss. Restricted Cash Restricted cash consists primarily of cash placed in separate restricted bank accounts as required under the terms of the Company’s lease agreements for its Cambridge, Massachusetts and Lexington, Massachusetts facilities (refer to Note 8). As of December 31, 2024 and 2023, the Company had $ 3.8 million and $ 3.7 million of restricted cash, respectively, of which $ 2.8 million and $ 2.7 million related to the Lexington facility, respectively, and $ 1.0 million related to the Cambridge facility. F- 9 Property and Equipment Property and equipment, which consists primarily of equipment, furniture, software and leasehold improvements, are stated at cost less accumulated depreciation. Depreciation is calculated on a straight-line basis over the following estimated useful lives of the assets: Equipment, Furniture and Software 3 - 7 years Leasehold Improvements Shorter of asset life or lease term Depreciation begins at the time the asset is placed in service. Maintenance and repairs are charged to operations as incurred. Upon retirement or sale, the cost of the disposed asset and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in the consolidated statements of operations and comprehensive loss. Impairment of Long-Lived Assets Long-lived assets consist of property and equipment. Long-lived assets are reviewed for impairment whenever events or other changes in circumstances indicate that the carrying amount may not be recoverable. Certain factors may exist or events may occur that indicate that impairment exists including, but not limited to, the following: significant underperformance relative to historical or projected future operating results; significant changes in the manner of use of the underlying assets; and significant adverse industry or market economic trends. When performing the impairment assessment for long-lived assets, the Company compares the carrying value of such assets to the estimated undiscounted future net cash flows expected from the use of the assets and their eventual disposition. In the event that the carrying value of the assets is determined to be unrecoverable, the Company would estimate the fair value of the assets and record an impairment charge for the excess of the carrying value over the fair value. Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”). This standard applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, and financial instruments. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five-step analysis: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step analysis to contracts when it is probable that the entity will collect the consideration to which it is entitled in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract, determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. The Company has entered into collaboration agreements for research, development, and commercial services, under which the Company licenses certain rights to its product candidates to third parties. The terms of these arrangements typically include payment to the Company of one or more of the following: non-refundable, upfront license fees; reimbursement of certain costs; customer option exercise fees; development, regulatory and commercial milestone payments; and royalties on net sales of licensed products. Any variable consideration is allocated to a performance obligation, and the cumulative revenue associated with this consideration is not recognized until it is deemed not to be at significant risk of reversal. In determining the appropriate amount of revenue to be recognized as the Company fulfills its obligations under each of its agreements for which the collaboration partner is also a customer, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. As part of the accounting for these arrangements, the Company must use significant judgment to determine: (a) the number of performance obligations based on the determination under step (ii) above; (b) the transaction price under step (iii) above; and (c) the timing of satisfaction of performance obligations as a measure of progress in step (v) above. The Company uses significant judgment to determine whether milestones or other variable consideration, except for royalties, should be included in the transaction price as described further below. The transaction price is allocated to the optional goods and services the Company expects to provide. The Company uses estimates to determine the timing of satisfaction of performance obligations. F- 10 Amounts received prior to being recognized as revenue are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current portion of deferred revenue in the accompanying consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue, net of current portion. Licenses of intellectual property: In assessing whether a promise or performance obligation is distinct from the other promises, the Company considers factors such as the research, development, manufacturing and commercialization capabilities of the customer and the availability of the associated expertise in the general marketplace. In addition, the Company considers whether the customer can benefit from a promise for its intended purpose without the receipt of the remaining promise, whether the value of the promise is dependent on the unsatisfied promise, whether there are other vendors that could provide the remaining promise, and whether it is separately identifiable from the remaining promise. For licenses that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Research and development services : If an arrangement is determined to contain a promise or obligation for the Company to perform research and development services, the Company must determine whether these services are distinct from other promises in the arrangement. In assessing whether the services are distinct from the other promises, the Company considers the capabilities of the customer to perform these same services. In addition, the Company considers whether the customer can benefit from a promise for its intended purpose without the receipt of the remaining promise, whether the value of the promise is dependent on the unsatisfied promise, whether there are other vendors that could provide the remaining promise, and whether it is separately identifiable from the remaining promise. For research and development services that are combined with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Customer options: If an arrangement is determined to contain customer options that allow the customer to acquire additional goods or services, the goods and services underlying the customer options are not considered to be performance obligations at the outset of the arrangement, as they are contingent upon option exercise. The Company evaluates the customer options for material rights, that is, the option to acquire additional goods or services for free or at a discount. If the customer options are determined to represent a material right, the material right is recognized as a separate performance obligation at the outset of the arrangement. The Company allocates the transaction price to material rights based on the standalone selling price. Amounts allocated to any material right are not recognized as revenue until the option is exercised and the performance obligation is satisfied. Milestone payments: At the inception of each arrangement that includes milestone payments, the Company evaluates whether a significant reversal of cumulative revenue provided in conjunction with achieving the milestones is probable, and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant reversal of cumulative revenue would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. For other milestones, the Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone in making this assessment. There is considerable judgment involved in determining whether it is probable that a significant reversal of cumulative revenue would not occur. At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all milestones subject to constraint and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. Royalties: For arrangements that include sales-based royalties, including milestone payments based on a level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). To date, the Company has not recognized any royalty revenue resulting from any of its licensing arrangements. Contract costs : The Company recognizes as an asset the incremental costs of obtaining a contract with a customer if the costs are expected to be recovered. As a practical expedient, the Company recognizes the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that it otherwise would have recognized is one year or less. To date, the Company has not incurred any incremental costs of obtaining a contract with a customer. F- 11 Research and Development Expenses Research and development expenses are expensed as incurred. External development costs are recognized based on an evaluation of the progress to completion of specific tasks. Payments for these activities are based on the terms of the individual agreements, which may differ from the pattern of costs incurred, and are reflected in the accompanying consolidated balance sheets as prepaid or accrued expenses. License Agreements and Patent Costs Costs associated with licenses of technology and patent costs are expensed as incurred and are generally included in research and development expense in the consolidated statements of operations and comprehensive loss. Refundable Tax Credits The Company is eligible for refundable tax credits with tax authorities for certain qualified operating expenses. The Company recognizes refundable tax credits when there is reasonable assurance that the Company will comply with the requirements of the refundable tax credit and that the refundable tax credit will be received. Refundable tax credits are recorded as income and classified in other income, net in the consolidated statements of operations and comprehensive loss. Net Loss per Share Basic net loss per share is computed using the weighted-average number of ordinary shares outstanding during the period. The outstanding Pre-Funded Warrants (as defined in Note 6) are included in the weighted-average number of ordinary shares outstanding used in the calculation of basic net loss per share as the exercise price is negligible and the warrants are fully vested and exercisable. Diluted net loss per share is computed using the sum of the weighted-average number of ordinary shares outstanding during the period and, if dilutive, the weighted-average number of potential ordinary shares, including the assumed exercise of share options and the assumed vesting of RSUs (as defined in Note 7). The Company’s Series A preferred shares do not entitle the holders of such shares to participate in dividends and do not contractually require the holders of such shares to participate in losses of the Company. Share-Based Compensation The Company measures and recognizes share-based compensation expense, for both employee and director option awards, based on the grant date fair value of the awards. The Company calculates the fair value of awards based on the grant date fair value of the underlying ordinary shares. The Company determines the fair value of share-based awards granted to non-employees as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. Equity instruments issued to non-employees as consideration for goods or services received by the Company have been accounted for based on the fair value of the equity instruments issued. The Company recognizes share-based compensation expense on a straight-line basis over the requisite service period of the awards, which is generally the vesting period. The Company accounts for forfeitures as they occur. The Company classifies share-based compensation expense in its consolidated statements of operations and comprehensive loss in the same manner in which the award recipient’s compensation costs are classified or in which the award recipient’s service payments are classified. The fair value of each share option grant was determined using the methods and assumptions discussed below. These inputs are generally subjective and require significant judgment and estimation by management. • Fair Value of Ordinary Shares The fair value of the ordinary shares underlying the Company’s share-based awards is based on the closing price of the Company’s ordinary shares as reported by the Nasdaq Global Market on the date of grant. • Expected Term The expected term of share options represents the weighted-average period that the share options are expected to remain outstanding. The Company estimated the expected term using the simplified method, which is an average of the contractual term of the option and the vesting period. • Expected Volatility Since there was limited historical data for the Company’s ordinary shares and limited company-specific historical volatility through the third quarter of 2021, the Company determined the share price volatility for options granted based on an analysis of the volatility used by a peer group of publicly traded companies. In evaluating similarity, the Company considers factors such as industry, stage of life cycle and size. Beginning in the fourth quarter of 2021, the Company had sufficient historical volatility data for its ordinary shares and as such no longer relies on an analysis of the volatility from a peer group to calculate expected volatility. F- 12 • Risk-free Interest Rate The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of the grant for zero-coupon U.S. Treasury notes with remaining terms similar to the expected term of the options. • Dividend Rate The expected dividend was assumed to be zero as the Company has never paid dividends and has no current plans to do so. Income Taxes The Company accounts for income taxes using an asset and liability approach, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the consolidated financial statements but have not been reflected in taxable income. A valuation allowance is established to reduce deferred tax assets to their estimated realizable value. Therefore, the Company provides a valuation allowance to the extent that it is more likely than not that all or a portion of the deferred tax assets will not be realized in the future. The Company accounts for uncertainty in income taxes recognized in the financial statements by applying a two-step process to determine the amount of tax benefit to be recognized. First, the tax position must be evaluated to determine the likelihood that it will be sustained upon external examination by the tax authorities. If the tax position is deemed more-likely-than-not to be sustained, the tax position is then assessed to determine the amount of benefit to recognize in the financial statements. The amount of the benefit that may be recognized is the largest amount that has a greater than 50 % likelihood of being realized upon ultimate settlement. The provision for income taxes includes the effects of any resulting tax reserves, or unrecognized tax benefits, that are considered appropriate as well as the related net interest and penalties. The Company recognizes interest and penalties related to uncertain tax positions in the income tax provision on the consolidated statements of operations and comprehensive loss. The Company has certain service arrangements in place between its U.S., Japan, U.K. and Singapore entities, which include transfer pricing assumptions. The determination of the appropriate level of transfer pricing requires judgment based on transfer pricing analyses of comparable companies. The Company monitors the nature of its service arrangements for changes in its operations as well as economic conditions. The Company also periodically reviews the transfer pricing analyses for changes in the composition in the pool of comparable companies as well as the related ongoing results of the comparable companies. Leases The Company accounts for leases in accordance with ASC Topic 842, Leases (“ASC 842”). At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present in the arrangement. Most leases with a term greater than one year are recognized on the balance sheet as right-of-use assets and short-term and long-term lease liabilities, as applicable. The Company typically only includes an initial lease term in its assessment of a lease arrangement. Options to renew a lease are not included in the Company’s assessment unless there is reasonable certainty that the Company will renew the lease. The Company monitors its plans to renew its leases on a quarterly basis. Certain lease agreements include rental payments that are adjusted periodically for inflation or other variables. In addition to rent, the leases may require the Company to pay additional amounts for taxes, insurance, maintenance, or other expenses, which are generally referred to as non-lease components. Such adjustments to rental payments and variable non-lease components are treated as variable lease payments and recognized in the period in which the obligation for these payments are incurred. Variable lease components and variable non-lease components are not measured as part of the right-of-use asset and lease liability. Only when lease components and their associated non-lease components are fixed are they accounted for as a single lease component and are recognized as part of a right-of-use asset and lease liability. Total contract consideration is allocated to the combined fixed lease and non-lease component. This policy election applies consistently to all asset classes under lease agreements. Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over the expected remaining lease term. Certain adjustments to the right-of-use asset may be required for items such as incentives received. The interest rate implicit in lease contracts is typically not readily determinable. As a result, the Company utilizes its incremental borrowing rate, which reflects the fixed rate at which the Company could borrow on a collateralized basis the amount of the lease payments in the same currency, for a similar term, in a similar economic environment. Recently Issued Accounting Pronouncements In November 2023, the Financial Accounting Standards Board (the “FASB”) finalized Accounting Standards Update No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). ASU 2023-07 requires enhanced disclosures about reportable segments and the chief operating decision maker. The Company adopted ASU 2023-07 for the Company's fiscal year 2024 annual reporting period and applied it retrospectively. The adoption did not have a material impact on the Company's consolidated financial statements. In December 2023, the FASB finalized Accounting Standards Update No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires a company's annual financial statements to include consistent categories and greater disaggregation of information in the rate reconciliation, and income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for the Company’s annual reporting periods beginning after December 15, 2025. Adoption is either with a F- 13 prospective method or a fully retrospective method of transition. Early adoption is permitted. The Company is currently evaluating the effect that adoption of ASU 2023-09 will have on its consolidated financial statements. In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”). ASU 2024-03 modifies the rules on income statement disclosures to enhance the transparency of and include more detailed information about the types of expenses, including purchases of inventory, employee compensation, depreciation, amortization, and depletion, in commonly presented expense captions such as cost of sales, research and development, and selling, general and administrative expenses. The amendments are intended to address investors’ requests for income statement expense disclosures that provide more information to help them better understand the components of an entity’s expenses, make their own judgments about the entity’s performance, and more accurately forecast expenses, and enable investors to better assess an entity’s prospects for future cash flows. It will also provide contextual information for an entity’s presentation and consideration of management’s discussion and analysis of financial position and results of operations. The guidance is effective for all entities for annual periods beginning after December 15, 2026. All entities should apply the guidance prospectively but have the option to apply it retrospectively. Early adoption is permitted. The Company is continuing to assess the timing of adoption and the potential impacts of ASU 2024-03 on the consolidated financial statements and related disclosures. 3. PROPERTY AND EQUIPMENT, NET Property and equipment, net, consists of the following: December 31, 2024 2023 (in thousands) Furniture and equipment $ 26,194 $ 26,072 Software 1,029 902 Leasehold improvements 28,885 28,525 Fixed assets in progress 349 294 Total 56,457 55,793 Less accumulated depreciation ( 46,329 ) ( 42,709 ) Property and equipment, net $ 10,128 $ 13,084 Substantially all of the Company’s long-lived assets were located in the United States as of December 31, 2024 and 2023. Depreciation expense was $ 3.9 million, $ 5.0 million, and $ 6.6 million for the years ended December 31, 2024, 2023, and 2022 , respectively. 4. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consist of the following: December 31, 2024 2023 (in thousands) Accrued compensation $ 15,358 $ 14,065 Accrued expenses related to CROs and CMOs 4,551 1,768 Accrued expenses and other current liabilities 1,172 995 Total accrued expenses and other current liabilities $ 21,081 $ 16,828 5. COLLABORATION AGREEMENTS GSK Collaboration and Equity Agreements On December 13, 2022, Wave USA and Wave UK entered into a Collaboration and License Agreement (the “GSK Collaboration Agreement”) with GlaxoSmithKline Intellectual Property (No. 3) (“GSK”). Pursuant to the GSK Collaboration Agreement, Wave and GSK have agreed to collaborate on the research, development, and commercialization of oligonucleotide therapeutics, including an exclusive global license to WVE-006. The discovery collaboration component has an initial four-year research term and combines Wave’s proprietary discovery and drug development platform, PRISM, with GSK’s unique genetic insights and its global F- 14 development and commercial capabilities. On January 27, 2023, the GSK Collaboration Agreement became effective, and GSK paid Wave an upfront payment of $ 120.0 million. Simultaneously with the execution of the GSK Collaboration Agreement, Wave entered into a Share Purchase Agreement (the “SPA”) on December 13, 2022, with Glaxo Group Limited (“GGL”), an affiliate of GSK, pursuant to which Wave agreed to sell 10,683,761 of its ordinary shares to GGL at a purchase price of $ 4.68 per share (the “GSK Equity Investment”). The GSK Equity Investment closed on January 26, 2023, following the completion of customary closing conditions. The ordinary shares purchased by GGL in the GSK Equity Investment are subject to lock-up and standstill restrictions and carry certain registration rights, customary for transactions of this kind. The Company did not incur any material costs in connection with the issuance of the ordinary shares under the SPA. The GSK Collaboration Agreement has three components: (1) a discovery collaboration which enables the Company to advance up to three programs leveraging targets informed by GSK’s novel genetic insights (“Wave’s Collaboration Programs”); (2) a discovery collaboration which enables GSK to advance up to eight programs leveraging PRISM and the Company’s oligonucleotide expertise and discovery capabilities (the “Discovery Research Collaboration”); and (3) an exclusive global license for GSK to WVE-006, the Company’s alpha-1 antitrypsin deficiency (“AATD”) program, that uses the Company’s proprietary AIMer technology (the "AATD Collaboration"). The Company will be responsible for preclinical, regulatory, manufacturing, and clinical activities for WVE-006 through the initial Phase 1/2 study, at the Company’s sole cost. Thereafter, GSK will be responsible for advancing WVE-006 through pivotal studies, registration, and global commercialization at GSK’s sole cost. Under the GSK Collaboration Agreement, each party grants to the other party certain licenses to the collaboration products to enable the other party to perform its obligations and exercise its rights under the GSK Collaboration Agreement, including license grants to enable each party to conduct research, development and commercialization activities pursuant to the terms of the GSK Collaboration Agreement. The parties’ exclusivity obligations to each other are limited on a target-by-target basis with regard to targets in the collaboration. GSK may terminate the GSK Collaboration Agreement for convenience, in its entirety or on a target-by-target basis. Subject to certain exceptions, each party has the right to terminate the GSK Collaboration Agreement on a target-by-target basis if the other party, or a related party, challenges the patentability, enforceability or validity of any patents within the licensed technology that cover any product that is subject to the GSK Collaboration Agreement. In the event of any material breach of the GSK Collaboration Agreement by a party, subject to cure rights, the other party may terminate the GSK Collaboration Agreement in its entirety if the breach relates to all targets or on a target-by-target basis if the breach relates to a specific target. In the event that GSK and its affiliates cease development, manufacturing and commercialization activities with respect to compounds or products subject to the GSK Collaboration Agreement and directed to a particular target, the Company may terminate the GSK Collaboration Agreement with respect to such target. Either party may terminate the GSK Collaboration Agreement for the other party’s insolvency. In certain termination circumstances, the Company would receive a license from GSK to continue researching, developing and manufacturing certain products. The GSK Collaboration Agreement, unless terminated earlier, will continue until the date on which: (i) with respect to a validation target, the date on which such validation target is not advanced into a collaboration program; or (ii) with respect to a collaboration target, the royalty term has expired for all collaboration products directed to the applicable collaboration target. The GSK Collaboration Agreement includes options to extend the research term for up to three additional years, which would increase the number of programs available to both parties. The Company will lead all preclinical research for GSK and the Company’s collaboration programs up to investigational new drug (“IND”)-enabling studies. The Company will lead IND-enabling studies, clinical development and commercialization for the Company’s collaboration programs. GSK collaboration programs will transfer to GSK for IND-enabling studies, clinical development and commercialization. The GSK Collaboration Agreement is managed by a joint steering committee in which both parties are represented equally. In addition, the AATD Collaboration is overseen by a joint development committee, a joint patent committee advises on intellectual property activities, and the Discovery Research Collaboration is overseen by a joint research committee. Both parties are represented equally for these committees and report to the joint steering committee. The Company assessed this arrangement in accordance with ASC 606, Revenue from Contracts with Customers ("ASC 606") and concluded that the contract counterparty, GSK, is a customer for the AATD Collaboration prior to GSK exercising its option and, for the Discovery Research Collaboration programs during the target validation research term. The Company identified the following material promises under the arrangement: (1) the exclusive global license for WVE-006; (2) the research and development services for WVE-006 through the Phase 1/2 study; (3) the discovery research services under the Discovery Research Collaboration to perform target validation programs; (4) research and development license for the Discovery Research Collaboration; and (5) the research and development services for the GSK collaboration programs through completion of a candidate selection. The research and development services for WVE-006 were determined to not be distinct from the exclusive global license and should therefore be combined into a single performance obligation for the AATD Collaboration. The research and development services for the Discovery Research Collaboration were determined to not be distinct from the research and development license for the Discovery Research Collaboration and should therefore be combined into a single performance obligation. In addition, the Company determined the standalone selling price for the option to advance up to eight programs from the Discovery Research Collaboration and determined it did not provide a material right to GSK. F- 15 Based on these assessments, the Company identified two performance obligations in the GSK Collaboration Agreement: (1) AATD Collaboration consisting of the research and development services through completion of the Phase 1/2 study and research and development license for WVE-006 and (2) Discovery Research Collaboration which consists of research and development services for validating the targets and license for research and development license for targets. At the outset of the arrangement, the transaction price included fixed consideration of the $ 120.0 million upfront, the $ 15.4 million in premium related to the GSK Equity Investment and the fixed consideration related to the additional target validation research funding. The Company allocated the estimated variable consideration relating to the target validation research to the Discovery Research Collaboration and the variable consideration relating to the development milestone to the AATD Collaboration and then allocated the fixed consideration to the performance obligations on a relative standalone selling price basis. The Company determined that the GSK Collaboration Agreement did not contain a significant financing component. The program initiation fees to advance up to eight programs from the Discovery Research Collaboration to preclinically develop the GSK collaboration programs and the additional potential milestone payments were excluded from the transaction price, as all milestone amounts were fully constrained at the inception of the GSK Collaboration Agreement. The Company will reevaluate the transaction price at the end of each reporting period, and as uncertain events are resolved or other changes in circumstances occur, the Company will adjust its estimate of the transaction price. Under the GSK Collaboration Agreement, GSK can advance up to eight programs leveraging the Company's PRISM platform and multiple RNA-targeting modalities (RNA editing, splicing, siRNA, and antisense) with target validation work ongoing across multiple therapy areas. GSK selected its first two programs to advance to development candidates following achievement of target validation in the three months ended June 30, 2024. These programs utilize the Company's next generation GalNAc-siRNA format and are in hepatology. Under the GSK Collaboration Agreement, GSK was required to provide an aggregate initiation payment of $ 12.0 million to the Company for these two oligonucleotide programs, which was received during the three months ended June 30, 2024. The following table summarizes the allocation of the total transaction price to the identified performance obligation under the GSK Collaboration Agreement, and the amount of the transaction price unsatisfied as of December 31, 2024 (in thousands): Transaction Price Allocated Transaction Price Unsatisfied (1) Performance Obligations: AATD Collaboration $ 156,778 $ 59,392 Discovery Research Collaboration 18,098 13,737 GSK Collaboration Program 12,000 10,472 Total $ 186,876 $ 83,601 (1) The Unsatisfied transaction price will be recognized over the remaining applicable research or program term. The Company developed the estimated standalone selling price for the global license for WVE-006, under the AATD Collaboration, using a discounted cash flow model. For the performance obligation associated with the research and development services under the Discovery Research Collaboration and the research and development services for WVE-006 under the AATD Collaboration, the Company determined the standalone selling price using estimates of the costs to perform the research and development services, including expected internal and external costs for services and supplies, adjusted to reflect a profit margin. The total estimated cost of the research and development services reflected the nature of the services to be performed and the Company’s best estimate of the length of time required to perform the services. Revenue associated with the AATD Collaboration performance obligation is being recognized as the research and development services are provided using an input measure, according to the costs incurred and the total costs expected to be incurred to satisfy the performance obligation. The revenue associated with the Discovery Research Collaboration performance obligation is being recognized as the research and development services are provided using an input measure, according to the costs incurred and the total costs expected to be incurred to satisfy the performance obligation. The amounts received that have not yet been recognized as revenue are recorded in deferred revenue on the Company’s consolidated balance sheet. Additional funding related to the Company’s research activities related to Discovery Research Collaboration will be recorded as accounts receivable when contractually enforceable and recorded as deferred revenue, or as revenue as the services are provided. During the year ended December 31, 2023 , the Company achieved a developmental milestone which pertained to the initiation of dosing in healthy volunteers in the RestorAATion clinical trial program, triggering a $ 20.0 million milestone payment to the Company from GSK. As of December 31, 2023 , the $ 20.0 million related to the achievement of the milestone was included in the current portion of accounts receivable and payment was received from GSK in the first quarter of 2024. Under the GSK Collaboration Agreement, during the years ended December 31, 2024 and December 31, 2023, the Company recognized revenue of $ 37.0 million and $ 66.3 million, respectively, using the input method described above. F- 16 The aggregate amount of the transaction price allocated to the Company’s unsatisfied and partially unsatisfied performance obligations which are recorded in deferred revenue as of December 31, 2024 is approximately $ 72.1 million, of which approximately $ 66.0 million is included in current liabilities and $ 6.1 million is included in long-term liabilities. The aggregate amount of the transaction price allocated to the Company’s unsatisfied and partially unsatisfied performance obligations which were recorded in deferred revenue as of December 31, 2023 was approximately $ 94.3 million, of which approximately $ 78.7 million was included in current liabilities and $ 15.6 million was included in long-term liabilities. Takeda Collaboration and Equity Agreements In February 2018 , Wave USA and Wave UK entered into a global strategic collaboration (the “Takeda Collaboration”) with Takeda Pharmaceutical Company Limited (“Takeda”), pursuant to which Wave USA, Wave UK and Takeda agreed to collaborate on the research, development and commercialization of oligonucleotide therapeutics for disorders of the Central Nervous System (“CNS”). The Takeda Collaboration provided the Company with at least $ 230.0 million in committed cash and Takeda with the option to co-develop and co-commercialize the Company’s CNS development programs in (1) Huntington’s disease (“HD”); (2) amyotrophic lateral sclerosis (“ALS”) and frontotemporal dementia (“FTD”); and (3) the Company’s discovery-stage program targeting ATXN3 for the treatment of spinocerebellar ataxia 3 (“SCA3”) (collectively, “Category 1 Programs”). In addition, the Takeda Collaboration provided Takeda the right to exclusively license multiple preclinical programs for CNS disorders, including Alzheimer’s disease and Parkinson’s disease (collectively, “Category 2 Programs”). In April 2018, the Takeda Collaboration became effective and Takeda paid the Company $ 110.0 million as an upfront payment. Takeda also agreed to fund the Company’s research and preclinical activities in the amount of $ 60.0 million during the four-year research term and to reimburse the Company for any collaboration-budgeted research and preclinical expenses incurred by Wave that exceed that amount. Simultaneously with Wave USA and Wave UK’s entry into the collaboration and license agreement with Takeda dated February 19, 2018, as amended (the “Takeda Collaboration Agreement”), the Company entered into a share purchase agreement with Takeda (the “Takeda Equity Agreement,” and together with the Takeda Collaboration Agreement, the “Takeda Agreements”) pursuant to which it agreed to sell to Takeda 1,096,892 of its ordinary shares at a purchase price of $ 54.70 per share. In April 2018 , the Company closed the Takeda Equity Agreement and received aggregate cash proceeds of $ 60.0 million. The Company did not incur any material costs in connection with the issuance of the shares. With respect to Category 1 Programs, the Company was responsible for researching and developing products and companion diagnostics for Category 1 Programs through completion of the first proof of mechanism study for such products. Takeda had an exclusive option for each target and all associated products and companion diagnostics for such target, which it could exercise at any time through completion of the proof of mechanism study. If Takeda had exercised this option, the Company would have received an opt-in payment and would have led manufacturing and joint clinical co-development activities and Takeda would have led joint co-commercial activities in the United States and all commercial activities outside of the United States. Global costs and potential profits would have been shared 50 : 50 and the Company would have been eligible to receive development and commercial milestone payments. In addition to its 50% profit share, the Company was eligible to receive option exercise fees and development and commercial milestone payments for each of the Category 1 Programs. With respect to Category 2 Programs, the Company granted Takeda the right to exclusively license multiple preclinical programs during a four-year research term (subject to limited extension for programs that were initiated prior to the expiration of the research term, in accordance with the Takeda Collaboration Agreement) (“Category 2 Research Term”). During that term, the Takeda Collaboration provided that the parties may collaborate on preclinical programs for up to six targets at any one time . The Company was responsible for researching and preclinically developing products and companion diagnostics directed to the agreed upon targets through completion of Investigational IND enabling studies in the first major market country. Thereafter, Takeda would have an exclusive worldwide license to develop and commercialize products and companion diagnostics directed to such targets, subject to the Company’s retained rights to lead manufacturing activities for products directed to such targets. Takeda agreed to fund the Company’s research and preclinical activities in the amount of $ 60.0 million during the research term and reimburse the Company for any collaboration-budgeted research and preclinical expenses incurred by the Company that exceeded that amount. The Company was also eligible to receive tiered high single-digit to mid-teen royalties on Takeda’s global commercial sales of products from each Category 2 Program. Under the Takeda Collaboration Agreement, each party granted to the other party specific intellectual property licenses to enable the other party to perform its obligations and exercise its rights under the Takeda Collaboration Agreement, including license grants to enable each party to conduct research, development and commercialization activities pursuant to the terms of the Takeda Collaboration Agreement. F- 17 The term of the Takeda Collaboration Agreement commenced on April 2, 2018 and, unless terminated earlier, would have continued until the date on which: (i) with respect to each Category 1 Program target for which Takeda does not exercise its option, the expiration or termination of the development program with respect to such target; (ii) with respect to each Category 1 Program target for which Takeda exercises its option, the date on which neither party is researching, developing or manufacturing any products or companion diagnostics directed to such target; or (iii) with respect to each Category 2 Program target, the date on which royalties are no longer payable with respect to products directed to such target. Takeda had the right to terminate the Takeda Collaboration Agreement for convenience on 180 days ’ notice, in its entirety or on a target-by-target basis. Subject to certain exceptions, each party had the right to terminate the Takeda Collaboration Agreement on a target-by-target basis if the other party, or a third party related to such party, challenges the patentability, enforceability or validity of any patents within the licensed technology that cover any product or companion diagnostic that was subject to the Takeda Collaboration Agreement. In the event of any material breach of the Takeda Collaboration Agreement by a party, subject to cure rights, the other party had the right to terminate the Takeda Collaboration Agreement in its entirety if the breach related to all targets or on a target-by-target basis if the breach related to a specific target. In the event that Takeda and its affiliates ceased development, manufacturing and commercialization activities with respect to compounds or products subject to the Takeda Collaboration Agreement and directed to a particular target, the Company had the right to terminate the Takeda Collaboration Agreement with respect to such target. Either party had the right to terminate the Takeda Collaboration Agreement for the other party’s insolvency. In certain termination circumstances, the Company would have received a license from Takeda to continue researching, developing and manufacturing certain products, and companion diagnostics. The Takeda Collaboration was managed by a joint steering committee in which both parties were represented equally. The joint steering committee was tasked with overseeing the scientific progression of each Category 1 Program and, prior to the Amendment (discussed below), the Category 2 Programs. The Company assessed this arrangement in accordance with ASC 606 and concluded that the contract counterparty, Takeda, is a customer for Category 1 Programs prior to Takeda exercising its option, and for Category 2 Programs during the Category 2 Research Term. The Company identified the following material promises under the arrangement: (1) the non-exclusive, royalty-free research and development license for each Category 1 Program; (2) the research and development services for each Category 1 Program through completion of the first proof of mechanism study; (3) the exclusive option to license, co-develop and co-commercialize each Category 1 Program; (4) the right to exclusively license the Category 2 Programs; and (5) the research and preclinical development services of the Category 2 Programs through completion of IND-enabling studies. The research and development services for each Category 1 Program were determined to not be distinct from the research and development license and should therefore be combined into a single performance obligation for each Category 1 Program. The research and preclinical development services for the Category 2 Programs were determined to not be distinct from the exclusive licenses for the Category 2 Programs and therefore were combined into a single performance obligation. Additionally, the Company determined that the exclusive option for each Category 1 Program was priced at a discount and, as such, provide material rights to Takeda, representing three separate performance obligations. Based on these assessments, the Company identified seven performance obligations in the Takeda Collaboration Agreement: (1) research and development services through completion of the first proof of mechanism and non-exclusive research and development license for HD; (2) research and development services through completion of the first proof of mechanism and non-exclusive research and development license for ALS and FTD; (3) research and development services through completion of the first proof of mechanism and non-exclusive research and development license for SCA3; (4) the material right provided for the exclusive option to license, co-develop and co-commercialize HD; (5) the material right provided for the exclusive option to license, co-develop and co-commercialize ALS and FTD; (6) the material right provided for the exclusive option to license, co-develop and co-commercialize SCA3; and (7) the research and preclinical development services and right to exclusively license the Category 2 Programs. At the outset of the arrangement, the transaction price included the $ 110.0 million upfront consideration received and the $ 60.0 million of committed research and preclinical funding for the Category 2 Programs. The Company determined that the Takeda Collaboration Agreement did not contain a significant financing component. The option exercise fees to license, co-develop and co-commercialize each Category 1 Program that could have been received were excluded from the transaction price until each customer option was exercised. The potential milestone payments were excluded from the transaction price, as all milestone amounts were fully constrained at the inception of the Takeda Collaboration Agreement. The Company would have reevaluated the transaction price at the end of each reporting period and, as uncertain events were resolved or other changes in circumstances occurred, if necessary, would have adjusted its estimate of the transaction price. The Company allocated the transaction price to the performance obligations on a relative standalone selling price basis. For the performance obligations associated with the research and development services through completion of the first proof of mechanism and non-exclusive research and development license for HD; the research and development services through completion of the first proof of mechanism and non-exclusive research and development license for ALS and FTD; the research and development services through completion of the first proof of mechanism and non-exclusive research and development license for SCA3; and the research and preclinical development services and right to exclusively license the Category 2 Programs, the Company determined the F- 18 standalone selling price using estimates of the costs to perform the research and development services, including expected internal and external costs for services and supplies, adjusted to reflect a profit margin. The total estimated cost of the research and development services reflected the nature of the services to be performed and the Company’s best estimate of the length of time required to perform the services. For the performance obligations associated with the material right provided for the exclusive option to license, co-develop and co-commercialize HD; the material right provided for the exclusive option to license, co-develop and co-commercialize ALS and FTD; and the material right provided for the exclusive option to license, co-develop and co-commercialize SCA3, the Company estimated the standalone fair value of the option to license each Category 1 Program utilizing an adjusted market assessment approach, and determined that any standalone fair value in excess of the amounts to be paid by Takeda associated with each option represented a material right. Revenue associated with the research and development services for each Category 1 Program performance obligation were recognized as the research and development services were provided using an input method, according to the costs incurred on each Category 1 Program and the total costs expected to be incurred to satisfy each Category 1 Program performance obligation. Prior to the Amendment described below, revenue associated with the research and preclinical development services for the Category 2 Programs performance obligation was recognized as the research and preclinical development services that were provided using an input method, according to the costs incurred on Category 2 Programs and the total costs expected to be incurred to satisfy the performance obligation. The amount allocated to the material right for each Category 1 Program option would have been recognized on the date that Takeda exercised each respective option, or immediately as each option expired unexercised. The amounts received that were not yet recognized as revenue were recorded in deferred revenue on the Company’s consolidated balance sheet. On October 15, 2021 , Wave USA, Wave UK and Takeda entered into the Second Amendment to the Takeda Collaboration Agreement (the “Amendment”), which discontinued the Category 2 component of the Takeda Collaboration. The Category 1 Programs under the Collaboration Agreement remain in effect and are unchanged by the Amendment. Pursuant to the Amendment, Takeda agreed to pay the Company an additional $ 22.5 million as full payment for reimbursable Category 2 Programs collaboration-budgeted research and preclinical expenses. The Company received this payment from Takeda related to the Category 2 component and recognized the full amount as collaboration revenue in the year ended December 31, 2021. During the year ended December 31, 2021, in addition to the revenue recognized related to the Amendment, the Company recognized another $ 18.5 million of collaboration revenue related to services pertaining to the Category 1 Programs and Category 2 Programs. In May 2023, the Company announced its decision to discontinue clinical development of WVE-004 for C9orf72-associated ALS and FTD (“C9 for ALS/FTD”), one of the Category 1 Programs. In July 2023, the joint steering committee that manages the Takeda Collaboration terminated C9 for ALS/FTD as a target under the collaboration (the “C9 Target”) and consequently Takeda and the Company’s rights and obligations under the Takeda Collaboration were terminated with respect to the C9 Target. As a result of the termination of the C9 for ALS/FTD Category 1 Program, the Company recognized $ 28.0 million in revenue during the three months ended September 30, 2023, which represented the remainder of the deferred revenue for the C9 for ALS/FTD Category 1 Program as of June 30, 2023. In the third quarter of 2023, the Company achieved a developmental milestone related to the HD Category 1 Program, which pertained to the positive results from a non-clinical study of WVE-003 in non-human primates (“NHPs”). As a result of achieving the milestone, the Company recognized $ 7.0 million in revenue, which was not previously recorded in deferred revenue, as it was fully constrained at the inception of the Takeda Collaboration. In December 2023, the joint steering committee that manages the Takeda Collaboration terminated the SCA3 Category 1 Program as a target under the collaboration and consequently Takeda and the Company’s rights and obligations under the Takeda Collaboration were terminated with respect to the SCA3 Category 1 Program. As a result of the termination of the SCA3 Category 1 Program, the Company recognized $ 9.9 million in revenue during the three months ended December 31, 2023, which represented the remainder of the deferred revenue for the SCA3 Category 1 Program as of September 30, 2023. In October 2024, the Company was notified by Takeda that Takeda did not intend to exercise and therefore elected to terminate its option (“Option Termination”) for the HD target under the Takeda Collaboration Agreement. As HD was the last active collaboration target under the Takeda Collaboration Agreement, the Takeda Collaboration Agreement expired with immediate effect, and $ 70.2 million that was previously recorded as deferred revenue was recognized as revenue in the fourth quarter of 2024 related to this expiration. In October 2024, the Company was notified by Takeda that Takeda did not intend to exercise and therefore elected to terminate its option (“Option Termination”) for the HD target under the Takeda Collaboration Agreement. As HD was the last active collaboration target under the Takeda Collaboration Agreement, the Takeda Collaboration Agreement expired with immediate effect, and $ 70.2 million that was previously recorded as deferred revenue was recognized as revenue in the fourth quarter of 2024 related to this expiration. F- 19 During the years ended December 31, 2024, 2023, and 2022 , the Company recognized revenue of approximately $ 71.3 million, $ 47.0 million, and $ 3.3 million, respectively, under the Takeda Collaboration Agreement in the Company’s consolidated statements of operations and comprehensive loss. Through December 31, 2024, the Company has recognized revenue of $ 199.5 million under the Takeda Collaboration Agreement as collaboration revenue in the Company’s consolidated statements of operations and comprehensive loss. The aggregate amount of the transaction price allocated to the Company’s unsatisfied and partially unsatisfied performance obligations which are recorded in deferred revenue as of December 31, 2024 and 2023 , is $ 0.0 million and $ 71.3 million, respectively. 6. SHARE CAPITAL The following represents the Company’s financing transactions during the years ended December 31, 2024, 2023, and 2022: • The Company entered into the Sales Agreement (as defined below) with Jefferies LLC ("Jefferies". During the years ended December 31, 2024, 2023, and 2022 , the Company sold 2,952,591 , 751,688 , and 458,092 ordinary shares, respectively, under its "at-the-market" equity program for aggregate net proceeds of $ 20.4 million, $ 3.1 million, and $ 1.2 million, respectively, after deducting commissions and offering expenses. • On June 16, 2022, the Company closed an underwritten offering (the “June 2022 Offering”) in which the Company issued and sold 25,464,483 of the Company’s ordinary shares at a price of $ 2.15 per share and pre-funded warrants (the “2022 Pre-Funded Warrants”) to purchase up to 7,093,656 of the Company’s ordinary shares at an offering price of $ 2.1499 per 2022 Pre-Funded Warrant, which represents the per share offering price for the ordinary shares less the $ 0.0001 per share exercise price for each 2022 Pre-Funded Warrant. These 2022 Pre-Funded Warrants were recorded as a component of shareholders’ equity within additional paid-in capital. The gross proceeds to the Company from the June 2022 Offering were $ 70.0 million before deducting underwriting discounts and commissions and other offering expenses. The net proceeds to the Company from the June 2022 Offering were approximately $ 65.5 million, after deducting underwriting commissions and offering expenses. The 2022 Pre-Funded Warrants are exercisable at any time after their original issuance and on or prior to the five-year anniversary of the original issuance date. A holder of 2022 Pre-Funded Warrants may not exercise the warrant if the holder, together with its affiliates, would beneficially own more than 19.99 % of the number of the Company’s ordinary shares outstanding or more than 19.99 % of the combined voting power of the Company’s securities outstanding immediately after giving effect to such exercise, unless and until shareholder approval is obtained. • On December 11, 2023, the Company closed an underwritten public offering (the “December 2023 Offering” ) in which the Company issued and sold 20,000,000 of the Company's ordinary shares at a price of $ 5.00 per share. The gross proceeds to the Company from the December 2023 Offering were $ 100.0 million before deducting underwriting discounts and commissions and other offering expenses. The net proceeds to the Company from the December 2023 Offering during the year ended December 31, 2023, were approximately $ 93.6 million, after deducting underwriting discounts and offering expenses. On January 4, 2024, the Company closed on the sale of an additional 3,000,000 ordinary shares at a price of $ 5.00 per share after the underwriters exercised their option to purchase the additional shares in full, which increased the aggregate number of ordinary shares sold in the December 2023 Offering to 23,000,000 . The Company ’ s aggregate gross proceeds from the December 2023 Offering were $ 115.0 million, before deducting underwriting discounts and commissions and offering expenses; $ 15.0 million of which relates to the exercise of the underwriters ’ option in January 2024. Subsequent to December 31, 2023, the Company received $ 14.0 million in net proceeds after deducting the underwriting discounts and commissions and offering expenses related to the December 2023 Offering. • On September 27, 2024, the Company closed an underwritten public offering (the "September 2024 Offering") in which the Company issued and sold 23,125,001 of the Company’s ordinary shares at a price of $ 8.00 per share and pre-funded warrants (the “2024 Pre-Funded Warrants”) to purchase up to 1,875,023 of the Company’s ordinary shares at an offering price of $ 7.9999 per 2024 Pre-Funded Warrant, which represents the per share offering price for the ordinary shares less the $ 0.0001 per share exercise price for each 2024 Pre-Funded Warrant. These 2024 Pre-Funded Warrants were recorded as a component of shareholders’ equity within additional paid-in capital. The gross proceeds to the Company from the September 2024 Offering were $ 200.0 million before deducting underwriting discounts and commissions and other offering expenses. The net proceeds to the Company from the September 2024 Offering were approximately $ 187.5 million, after deducting underwriting commissions and offering expenses. The 2024 Pre-Funded Warrants are exercisable at any time after their original issuance and on or prior to the five-year anniversary of the original issuance date. A holder of the 2024 Pre-Funded Warrants may not exercise the warrant if the holder, together with its affiliates, would beneficially own more than 4.99 % (or at the election of such holder, 9.99 % or 19.99 %) of the number of the Company’s ordinary shares outstanding or more than 4.99 % (or at the election of such holder, 9.99 % or 19.99 %) of the combined voting power of the Company’s securities outstanding immediately after giving effect to such exercise, unless and until shareholder approval is obtained. F- 20 • On October 1, 2024, the representatives of the underwriters in connection with the September 2024 Offering exercised their option in full to purchase an additional 3,750,000 ordinary shares, which increased the aggregate number of ordinary shares sold in the September 2024 Offering to 26,875,001 . The Company’s aggregate gross proceeds from the September 2024 Offering were $ 230.0 million, before deducting underwriting discounts and commissions and offering expenses; $ 30.0 million of which relates to the exercise of the underwriters’ option in October 2024. • On November 12, 2024, the Company filed an automatic shelf registration statement on Form S-3ASR with the SEC for which the Company registered for sale an indeterminate amount of any combination of its ordinary shares, debt securities, warrants, rights and/or units from time to time and at prices and on terms that the Company may determine, which is referred to as the “2024 WKSI Shelf”. The 2024 WKSI Shelf includes a prospectus covering up to an aggregate of $ 250.0 million in ordinary shares that the Company is able to issue and sell from time to time, through Jefferies acting as its sales agent, pursuant to the Open Market Sale Agreement, dated May 10, 2019, as amended by Amendment No. 1, dated as of March 2, 2020, Amendment No. 2, dated as of March 3, 2022, and Amendment No. 3, dated as of November 12, 2024, (as amended, the “Sales Agreement”), for its “at-the-market” equity program. Features of the Series A Preferred Shares and Ordinary Shares The Series A preferred shares and ordinary shares have no par value and there is no concept of authorized share capital under Singapore law. The Series A preferred shares are not redeemable and have no entitlement to dividends. Voting The holders of Series A preferred shares are not entitled to vote on any of the matters proposed to shareholders, other than as specified in the Company's Constitution. The holders of ordinary shares are entitled to one vote for each ordinary share held at all meetings of shareholders and written actions in lieu of meetings. Dividends All dividends, if any, shall be declared and paid pro rata according to the number of ordinary shares held by each member entitled to receive dividends. The Company’s board of directors may deduct from any dividend all sums of money presently payable by the member to the Company on account of calls. Liquidation In the event of a liquidation, dissolution or winding up of, or a return of capital by the Company, the ordinary shares will rank equally with the Series A preferred shares after the payment of the liquidation preference of an aggregate of approximately $ 10 thousand for Series A preferred shares. 7. SHARE-BASED COMPENSATION The Wave Life Sciences Ltd. 2021 Equity Incentive Plan was approved by the Company’s shareholders and went into effect on August 10, 2021 and was amended effective as of August 9, 2022, August 1, 2023, and August 6, 2024 (as amended, the “2021 Plan”). The 2021 Plan serves as the successor to the Wave Life Sciences Ltd. 2014 Equity Incentive Plan, as amended (the “2014 Plan”), such that outstanding awards granted under the 2014 Plan continue to be governed by the terms of the 2014 Plan, but no awards may be made under the 2014 Plan after August 10, 2021. The aggregate number of ordinary shares authorized for issuance of awards under the 2021 Plan was originally 5,450,000 ordinary shares, and was subsequently increased to 11,450,000, 17,950,000 , and 22,950,000 in August 2022, August 2023, and August 2024, respectively, plus the number of ordinary shares underlying any awards under the 2014 Plan that are forfeited, cancelled or otherwise terminated (other than by exercise or withheld by the Company to satisfy any tax withholding obligation) on or after August 10, 2021. The 2021 Plan authorizes (and the 2014 Plan previously authorized) the board of directors or a committee of the board of directors to, among other things, grant non-qualified share options, restricted awards, which include restricted shares and restricted share units (“RSUs”), and performance awards to eligible employees and directors of the Company. The Company accounts for grants to its board of directors as grants to employees. As of December 31, 2024 , 7,052,136 ordinary shares remained available for future grant under the 2021 Plan. In accordance with Nasdaq Listing Rule 5635(c)(4), the board of directors or a committee of the board may also issue inducement grants outside of the 2021 Plan, as an inducement material to an individual's entering into employment with the Company. F- 21 Options and RSUs Share option activity is summarized as follows: Number of Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) (1) Outstanding as of January 1, 2024 14,107,710 $ 6.58 Granted 7,480,600 4.36 Exercised ( 770,636 ) 3.87 Forfeited or cancelled ( 1,364,543 ) 7.32 Outstanding as of December 31, 2024 19,453,131 $ 5.78 7.11 $ 144,819 Options exercisable as of December 31, 2024 9,155,502 $ 7.34 5.44 $ 62,214 (1) The aggregate intrinsic value of options is calculated as the difference between the exercise price of the share options and the fair value of the Company’s ordinary shares for those share options that had exercise prices lower than the fair value of the ordinary shares as of the end of the period. Options generally vest over periods of one to four years , and options that are forfeited or cancelled are available to be granted again. The contractual life of options is generally five or ten years from the grant date. The assumptions used in the Black-Scholes option pricing model to determine the fair value of share options granted to employees during the period were as follows: For the Year Ended December 31, 2024 2023 2022 Risk-free interest rate 3.56 % – 4.64 % 3.46 % – 4.71 % 1.35 % – 4.23 % Expected term (in years) 3.0 – 6.1 3.0 – 6.1 3.0 – 6.1 Expected volatility 88 % – 100 % 87 % – 93 % 63 % – 96 % Expected dividend yield 0 % 0 % 0 % In October 2022, the compensation committee of the Company’s board of directors (the "Compensation Committee") granted Dr. Verdine, one of the Company’s founders and a member of the Company’s board of directors, a non-qualified share option for 163,467 ordinary shares ( “Verdine Scientific Advisory Grant”) as form of payment under Dr. Verdine’s consulting agreement for scientific advisory services (as described in Note 13) for the service period of October 1, 2022 through December 31, 2024, the vesting of which is subject to Dr. Verdine’s continued service under the consulting agreement. The Verdine Scientific Advisory Grant was granted as a non-employee grant during the year ended December 31, 2022, and there were no equity grants made to non-employees during the years ended December 31, 2023 and 2024. The assumptions used in the Black-Scholes option pricing model to determine the fair value of the Verdine Scientific Advisory Grant were as follows: Year Ended December 31, 2022 Risk-free interest rate 4.29 % Expected term (in years) 2.5 Expected volatility 99 % Expected dividend yield 0 % F- 22 RSU activity for the year ended December 31, 2024 is summarized as follows: RSUs Average Grant Date Fair Value (in dollars per share) Outstanding as of January 1, 2024 637,557 $ 7.08 Granted 379,100 7.04 Vested ( 100,326 ) 4.90 Forfeited ( 84,288 ) 5.01 RSUs Outstanding at December 31, 2024 832,043 $ 7.54 RSUs can be time-based or performance-based. Vesting of the performance-based RSUs is contingent on the occurrence of certain regulatory or commercial milestones. In March 2021, the Compensation Committee approved an amendment and restatement of the Company’s outstanding 2019 performance-based RSUs to add an additional milestone to the existing milestones. In 2021, the Company also granted performance-based RSUs with the same terms to certain employees who did not receive the 2019 performance-based RSUs. The Company did not recognize expense in 2024 related to the performance-based RSUs as the remaining milestones were not considered probable of achievement. In April 2022, the Company determined that a performance-based RSU milestone was achieved and consequently 50 % of the outstanding performance-based RSUs vested, which resulted in the issuance of 384,646 ordinary shares. During the year ended December 31, 2022, the Company recorded share-based compensation expense of approximately $ 3.8 million related to the performance-based RSUs, which represents all of the expense related to the achievement of this performance-based RSU milestone. During the years ended December 31, 2024, 2023, and 2022 , the Company recognized share-based compensation expense of $ 0.8 million, $ 1.0 million, and $ 10.3 million, respectively, related to RSUs. RSUs that are forfeited are available to be granted again. During the year ended December 31, 2024 , 379,100 time-based RSUs were granted to employees. Of the RSUs outstanding at December 31, 2024, 540,779 are time-based RSUs and 291,264 are performance-based RSUs. Time-based RSUs generally vest over periods of one to four years . During the years ended December 31, 2024, 2023, and 2022 , the Company recognized share-based compensation expense related to options of $ 11.9 million, $ 8.5 million, and $ 6.7 million, respectively. The total intrinsic value of options exercised was $ 4.4 million, $ 0.3 million, and $ 0.4 million for the years ended December 31, 2024, 2023, and 2022, respectively. As of December 31, 2024, the unrecognized compensation cost related to outstanding options was $ 28.9 million . The unrecognized compensation cost related to outstanding options is expected to be recognized over a weighted-average period of approximately 2.67 years . For the years ended December 31, 2024 and 2023 , the weighted-average grant date fair value per granted option was $ 3.38 and $ 3.45 , respectively. The aggregate fair value of options that vested during the years ended December 31, 2024 and 2023 was $ 11.4 million and $ 8.4 million, respectively. The unrecognized compensation costs related to outstanding time-based RSUs was $ 2.8 million as of December 31, 2024, and is expected to be recognized over a weighted-average period of approximately 2.25 years. The total fair value of RSUs vested during the years ended December 31, 2024, and 2023 was $ 0.7 million and $ 2.0 million, respectively. Employee Share Purchase Plan The Wave Life Sciences Ltd. Employee Share Purchase Plan, as amended ("ESPP"), allows full-time and certain part-time employees to purchase the Company’s ordinary shares at a discount to fair market value. Eligible employees may enroll in a six-month offering period beginning every January 15 th and July 15 th . Shares are purchased at a price equal to 85 % of the lower of the fair market value of the Company’s ordinary shares on the first business day or the last business day of an offering period. During the years ended December 31, 2024, and 2023 , 176,498 and 225,913 ordinary shares were issued under the ESPP, respectively. The aggregate number of ordinary shares authorized for issuance under the ESPP was originally 1,000,000 and was subsequently increased to 3,000,000 in August 2023. As of December 31, 2024 , there were 2,314,002 ordinary shares available for issuance under the ESPP. F- 23 Share-Based Compensation Expense Share-based compensation expense for the years ended December 31, 2024, 2023, and 2022 is classified as operating expenses in the consolidated statements of operations and comprehensive loss as follows: For the Year Ended December 31, 2024 2023 2022 (in thousands) Research and development expenses $ 6,332 $ 4,617 $ 7,467 General and administrative expenses 6,809 5,178 9,727 Total share-based compensation expense $ 13,141 $ 9,795 $ 17,194 Of the total share-based compensation expense recorded for the years ended December 31, 2024, 2023, and 2022 , $ 0.3 million, $ 0.2 million, and less than $ 0.1 million, respectively, were related to non-employee option grants, specifically the Verdine Scientific Advisory Grant, and all of the related expense is included in research and development expenses on the consolidated statements of operations and comprehensive loss. 8. LEASES Lease Arrangements The Company enters into lease arrangements for its facilities. A summary of the arrangements is as follows: Operating Leases Lexington On September 26, 2016, and as amended on December 31, 2016, the Company entered into a 10 year and 9-month lease, which includes two successive five-year renewal options , for its facility in Lexington, Massachusetts, which the Company uses primarily for its current good manufacturing practices (“cGMP”) manufacturing, as well as for additional laboratory and office space. As there is not reasonable certainty that the renewal options will be exercised, the lease liabilities and the right-of-use assets pertaining to the Lexington Lease do not account for the two successive five-year renewal options. Throughout the term of the lease, the Company is responsible for paying certain costs and expenses, in addition to the rent, as specified in the lease, including a proportionate share of applicable taxes, operating expenses and utilities. As required under the terms of the lease agreement, the Company has placed restricted cash of approximately $ 2.8 million and $ 2.7 million in a separate bank account as of December 31, 2024 and 2023, respectively. Cambridge In April 2015, the Company entered into a lease agreement for an office and laboratory facility in Cambridge, Massachusetts (the “Cambridge Lease”), which commenced in October 2015 with a term of 7.5 years with a five-year renewal option to extend the lease . Throughout the term of the lease, the Company is responsible for paying certain costs and expenses, in addition to the rent, as specified in the lease, including a proportionate share of applicable taxes, operating expenses and utilities. As required under the terms of the lease agreement, the Company has placed restricted cash of $ 1.0 million in a separate bank account as of December 31, 2024 and 2023. In December 2020, the Company exercised its option under the Cambridge Lease to lease the additional office and laboratory space at the existing facility. The combined space constitutes the entire building. The lease for the additional space commenced on October 1, 2021, with a term of five years and is considered a separate lease from the Cambridge Lease. On the commencement date, the Company utilized the operating lease classification and recorded a right-of-use asset and corresponding operating lease liability of $ 4.5 million and began recognizing straight-line rent expense under ASC 842. Throughout the term of the lease, the Company is responsible for paying certain costs and expenses, in addition to the rent, as specified in the lease, including a proportionate share of applicable taxes, operating expenses and utilities. In June 2022, the Company exercised the five-year renewal option under the Cambridge Lease to extend the lease term through March 2028 (the “Cambridge Lease Extension”). Therefore, as required by ASC 842, the Company calculated an incremental borrowing rate of 10.53 % and remeasured the right-of-use asset and the lease liabilities related to the Cambridge Lease Extension. As a result, an additional $ 12.0 million of operating right-of-use asset and corresponding operating lease liabilities were recorded relating to the Cambridge Lease Extension. F- 24 The following table contains a summary of the lease costs recognized under ASC 842 and other information pertaining to the Company’s operating leases for the years ended December 31, 2024 and 2023: For the Year Ended December 31, 2024 2023 2022 (in thousands) Lease cost Operating lease cost $ 7,365 $ 7,365 $ 6,458 Variable lease cost 2,998 2,798 2,508 Total lease cost $ 10,363 $ 10,163 $ 8,966 Other information Operating cash flows used for operating leases $ 9,311 $ 8,655 $ 7,226 Increase in operating right-of-use assets $ — $ — $ 12,006 Operating lease liabilities arising from obtaining right-of-use assets $ — $ — $ 12,006 Weighted average remaining lease term 3 years 4 years 5 years Weighted average discount rate 9.2 % 9.2 % 9.2 % Future minimum lease payments under the Company’s non-cancelable operating leases as of December 31, 2024, are as follows: As of December 31, 2024 (in thousands) 2025 9,591 2026 9,584 2027 8,987 2028 886 2029 and thereafter - Total lease payments $ 29,048 Less: imputed interest ( 3,644 ) Total operating lease liabilities $ 25,404 9. COMMITMENTS AND CONTINGENCIES Unasserted Claims In the ordinary course of business, the Company may be subject to legal proceedings, claims and litigation as the Company operates in an industry susceptible to patent and other legal claims. The Company accounts for estimated losses with respect to legal proceedings and claims when such losses are probable and estimable. Legal costs associated with these matters are expensed when incurred. The Company is not currently a party to any material legal proceedings. F- 25 10. NET LOSS PER ORDINARY SHARE In connection with the September 2024 Offering, the Company sold 1,875,023 2024 Pre-Funded Warrants, which are included in the total vested and exercisable pre-funded warrants (the 2022 Pre-Funded Warrants and the 2024 Pre-Funded Warrants are referred to together as the “Pre-Funded Warrants”). As of December 31, 2024 and 2023 , there were 8,968,679 and 7,093,656 , respectively, vested and exercisable Pre-Funded Warrants outstanding to purchase ordinary shares for the exercise price of $ 0.0001 per share, provided that, unless and until the Company obtains shareholder approval for the issuance of the shares underlying the Pre-Funded Warrants, a holder will not be entitled to exercise any portion of any Pre-Funded Warrant, which, upon giving effect to such exercise, would cause (i) the aggregate number of our ordinary shares beneficially owned by the holder (together with its affiliates) to exceed, depending on the terms of the applicable Pre-Funded Warrants and in certain cases at the election of the holder, either 4.99 %, 9.99 % or 19.99 % of the number of our ordinary shares outstanding immediately after giving effect to the exercise, or (ii) the combined voting power of our securities beneficially owned by the holder (together with its affiliates) to exceed, depending on the terms of the applicable Pre-Funded Warrants and in certain cases at the election of the holder, either 4.99 %, 9.99 % or 19.99 % of the combined voting power of all of our securities then outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the applicable Pre-Funded Warrants. The Pre-Funded Warrants are included in the weighted-average shares outstanding used in the calculation of basic net loss per share as the exercise price is negligible and the warrants are fully vested and exercisable. Basic loss per share is computed by dividing net loss attributable to ordinary shareholders by the weighted-average number of ordinary shares outstanding. The Company’s potentially dilutive shares, which include outstanding share options to purchase ordinary shares and RSUs, are considered to be ordinary share equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. The table below sets forth the computation of the Company’s basic and diluted net loss attributable to ordinary shareholders: Year Ended December 31, 2024 2023 2022 (in thousands except share and per share data) Numerator: Net loss attributable to ordinary shareholders $ ( 97,008 ) $ ( 57,513 ) $ ( 161,823 ) Denominator: Weighted-average ordinary shares outstanding 138,277,468 106,097,268 78,855,810 Net loss per share, basic and diluted $ ( 0.70 ) $ ( 0.54 ) $ ( 2.05 ) The following potential ordinary shares, presented based on amounts outstanding at each period end, were excluded from the calculation of diluted net loss per share attributable to ordinary shareholders for the periods indicated because including them would have had an anti-dilutive effect: As of December 31, 2024 2023 2022 Options to purchase ordinary shares 19,453,131 14,107,710 9,682,054 RSUs 832,043 637,557 934,342 11. INCOME TAXES The components of loss before income taxes were as follows: Year Ended December 31, 2024 2023 2022 (in thousands) Singapore $ ( 4,202 ) $ ( 7,441 ) $ ( 8,714 ) Rest of world ( 92,806 ) ( 50,749 ) ( 152,428 ) Loss before income taxes $ ( 97,008 ) $ ( 58,190 ) $ ( 161,142 ) During the years ended December 31, 2024, 2023, and 2022 , the Company recorded no income tax benefit or provision , an income tax benefit of $ 0.7 million, and an income tax provision of $ 0.7 million, respectively. The income tax benefit for the year ended December 31, 2023 was due to a change in estimate in connection with U.S. tax guidance relating to the capitalization of research and development expenditures. The income tax provision for the year ended December 31, 2022 was primarily due to the requirement F- 26 under the Tax Cuts and Jobs Act of 2017 for taxpayers to capitalize and amortize research and development expenditures over five or fifteen years pursuant to Section 174 of the Internal Revenue Code of 1986, as amended (the “Code”). The components of the benefit (provision) for income taxes were as follows: Year Ended December 31, 2024 2023 2022 (in thousands) Current benefit (provision) for income taxes: Singapore $ — $ — $ — Rest of world — 677 ( 681 ) Total current benefit (provision) for income taxes $ — $ 677 $ ( 681 ) Deferred benefit for income taxes: Singapore $ — $ — $ — Rest of world — — — Total deferred benefit (provision) for income taxes $ — $ — $ — Total benefit (provision) for income taxes $ — $ 677 $ ( 681 ) A reconciliation of the Singapore statutory income tax rate to the Company’s effective income tax rate is as follows: Year Ended December 31, 2024 2023 2022 Singapore statutory income tax rate 17.0 % 17.0 % 17.0 % Federal and state tax credits 9.8 11.5 3.3 Permanent differences ( 3.1 ) — 0.1 Changes in reserves for uncertain tax positions ( 6.0 ) ( 2.8 ) 0.4 Foreign rate differential 7.2 7.4 8.8 Tax rate change ( 2.2 ) 0.4 — Return to provision 0.9 4.4 ( 0.9 ) Other ( 0.4 ) 0.1 ( 0.1 ) Change in deferred tax asset valuation allowance ( 26.0 ) ( 36.1 ) 7.3 Deferred tax adjustments 2.8 ( 0.7 ) ( 36.3 ) Effective income tax rate 0.0 % 1.2 % ( 0.4 )% The components of the Company’s deferred tax assets and liabilities as of December 31, 2024 and 2023 are as follows: December 31, 2024 2023 (in thousands) Deferred tax assets: Net operating loss carryforwards $ 177,639 $ 172,547 Federal and state tax credits 15,800 8,155 Share-based compensation 8,649 7,512 Accumulated amortization 578 694 Operating lease liabilities 6,626 8,775 Deferred revenue 8,836 10,716 Capitalized research and development 54,035 41,239 Accumulated depreciation 3,873 3,508 Other 942 237 Total deferred tax assets 276,978 253,383 Valuation allowance ( 272,313 ) ( 247,193 ) Net deferred tax assets 4,665 6,190 Deferred tax liabilities: Operating lease right-of-use assets ( 4,661 ) ( 6,185 ) Other ( 4 ) ( 5 ) Total deferred tax liabilities ( 4,665 ) ( 6,190 ) Net deferred tax assets (liabilities) $ — $ — F- 27 A roll-forward of the valuation allowance for the years ended December 31, 2024 and 2023 is as follows: Year Ended December 31, 2024 2023 (in thousands) Balance at beginning of year $ 247,193 $ 226,273 Increase in valuation allowance 25,169 20,969 Effect of foreign currency translation ( 49 ) ( 49 ) Balance at end of year $ 272,313 $ 247,193 As of December 31, 2024 , the Company had federal net operating loss carryforwards in the United States of $ 313.7 million, of which $ 312.9 million may be available to offset future U.S. federal taxable income indefinitely, while $ 0.8 million of carryforwards may offset future U.S. federal taxable income through 2037 . As of December 31, 2024 , the Company had U.S. state net operating loss carryforwards of $ 64.9 million available to offset future U.S. state taxable income that will begin to expire in 2038 . As of December 31, 2024 and 2023 , the Company had U.S. federal research and development tax credit carryforwards of approximately $ 11.2 million and $ 6.1 million, respectively, available to offset future U.S. federal income taxes and will begin to expire in 2042 . As of December 31, 2024 and 2023 , the Company had U.S. state research and development tax credit carryforwards of approximately $ 4.8 million and $ 2.6 million, respectively, available to offset future U.S. state income taxes and will begin to expire in 2037 . As of December 31, 2024 , the Company had a U.S. orphan drug credit carryforward of $ 0.8 million available to offset future U.S. federal income taxes that will begin to expire in 2042 . As of December 31, 2024 and 2023 , the Company had net operating loss carryforwards in Japan of $ 0.7 million and $ 1.4 million, respectively, which may be available to offset future Japan taxable income and begin to expire in 2025 . As of December 31, 2024 and 2023 , the Company had net operating loss carryforwards in Singapore of $ 132.7 million and $ 122.0 million, respectively, which may be available to offset future Singapore taxable income and can be carried forward indefinitely. As of December 31, 2024 and 2023, the Company had net operating loss carryforwards in the United Kingdom (“UK”) of $ 339.5 million and $ 335.7 million, respectively, which may be available to offset future UK taxable income and can be carried forward indefinitely. The Company has evaluated the positive and negative evidence bearing upon its ability to realize its deferred tax assets. As of December 31, 2024, management has considered the Company’s history of cumulative net losses incurred since inception and its lack of commercialization of any products or generation of any revenue from product sales since inception and has concluded that it is more likely than not that the Company will not realize the benefits of the deferred tax assets in all jurisdictions. Accordingly, a full valuation allowance has been established against the Company's deferred tax assets as of December 31, 2024. The valuation allowance increased by $ 25.1 million in 2024. The increase in the valuation allowance for 2024 was primarily a result of operating losses generated with no corresponding financial statement benefit. The Company may release this valuation allowance when management determines that it is more-likely-than-not that the deferred tax assets will be realized. Any release of valuation allowance will be recorded as a tax benefit either increasing net income or decreasing net loss. The Company’s reserves related to income taxes and its accounting for uncertain tax positions are based on a determination of whether and how much of a tax benefit taken by the Company in its tax filings or positions is more-likely-than-not to be realized following resolution of any potential contingencies present related to the tax benefit. A summary of activity in the Company’s gross unrecognized tax benefits, excluding interest and penalties, is as follows: 2024 2023 2022 (in thousands) Unrecognized tax benefit at the beginning of the year $ 15,790 $ 13,945 $ 19,864 Tax positions related to prior years 2,091 114 ( 7,320 ) Tax positions related to the current year 2,917 1,731 1,401 Unrecognized tax benefit at the end of the year $ 20,798 $ 15,790 $ 13,945 As of December 31, 2024 and 2023 , the total amount of gross unrecognized tax benefits, which excludes interest and penalties, was $ 20.8 million and $ 15.8 million, respectively. At December 31, 2024 , no ne of the net unrecognized tax benefits would affect the Company’s effective tax rate due to the Company's full valuation allowance. The Company anticipates that $ 2.6 million of the total unrecognized tax benefits at December 31, 2024 will decrease within the next twelve months due to certain tax return filings. F- 28 The Company files income tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by various tax authorities in the United States, Japan, Singapore and the United Kingdom. Tax years from 2021 to the present are still open to examination in the United States, from 2019 to the present in Japan, from 2020 to the present in Singapore and from 2023 to the present in the United Kingdom. To the extent that the Company has tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon examination by the tax authorities to the extent utilized in a future period. As of December 31, 2024 and 2023 , $ 37.8 million and $ 23.9 million, respectively, of cash and cash equivalents were held by the Company’s subsidiaries outside of Singapore. The Company does not provide for Singapore income tax or withholding taxes on the outside basis differences, including foreign unremitted earnings of its subsidiaries as they are permanently reinvested. If the Company decides to change its indefinite reversal assertion in the future, the Company may be required to record deferred taxes. Because of the complexity of Singapore and the rest-of-the-world tax rules applicable to the method of recovery of the investment in its subsidiaries, including distribution of earnings from its subsidiaries to Singapore, the determination of the unrecognized deferred tax liability is not practicable. Utilization of the net operating loss carryforwards and research and development tax credit carryforwards in the United States may be subject to a substantial annual limitation under Section 382 of the Code, due to ownership changes that have occurred previously or that could occur in the future. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the shares of a corporation by more than 50% over a three-year period. The Company has completed Section 382 studies to assess whether there have been ownership changes since its formation through 2022. The results of the studies indicated that the Company experienced ownership changes as defined by Section 382 of the Code, and, as such, the Company has adjusted its net operating losses and research and development credit carryforwards to reflect the limitations as a result of such ownership changes. Should one or more ownership changes occur in the future, the Company’s ability to utilize its net operating losses and research and development credit carryforwards may be further limited. 12. EMPLOYEE BENEFIT PLANS The Company has a 401(k) retirement and savings plan (the “401(k) Plan”) covering employees of Wave USA. The 401(k) Plan allows employees to make contributions up to the maximum allowable amount set by the Internal Revenue Service. Under the 401(k) Plan, the Company may make discretionary contributions as approved by the board of directors. The Company made contributions of $ 1.7 million and $ 1.4 million in the years ended December 31, 2024 and 2023 , respectively. 13. RELATED PARTIES The Company had the following related party transactions for the periods presented in the accompanying consolidated financial statements: • In 2012, the Company entered into a consulting agreement for scientific advisory services with Dr. Gregory L. Verdine, one of the Company’s founders and a member of the Company’s board of directors. The consulting agreement does not have a specific term and may be terminated by either party upon 14 days’ prior written notice. Pursuant to the consulting agreement, the Company pays Dr. Verdine approximately $ 13 thousand per month, plus reimbursement for certain expenses. In October 2022, the Compensation Committee granted Dr. Verdine a non-qualified share option for 163,467 ordinary shares in lieu of cash as payment under this consulting agreement for the service period of October 1, 2022 through December 31, 2024, the monthly vesting of which is subject to Dr. Verdine’s continued service under the consulting agreement. • In April 2023, the Company engaged Shin Nippon Biomedical Laboratories Ltd. (“SNBL”), one of the Company’s shareholders, to provide approximately $ 2.8 million in certain NHPs contract research services to the Company. During the years ended December 31, 2024 and 2023 , the Company made payments of $ 0.9 million and $ 1.4 million, respectively, to SNBL. Through December 31, 2024 , the Company has paid $ 2.3 million to SNBL for the aforementioned NHP contract research services. F- 29 14. SEGMENT INFORMATION Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the CODM in deciding how to allocate resources to an individual segment and in assessing performance. The Company operates as a single reporting segment, focused on developing its proprietary RNA medicines platform, PRISM, to develop and commercialize a broad pipeline of RNA medicines in a variety of therapeutic areas. Consistent with our operational structure, our CEO, as the CODM , manages and allocates resources on a consolidated basis at the global corporate level. The results of our operations are reported on a consolidated basis for purposes of segment reporting. The CEO uses consolidated net loss that is reported on the consolidated statements of operations and comprehensive loss for the purposes of assessing performance, allocating resources and planning, monitoring budget versus actual results, and forecasting future periods. The following table is representative of the significant expense categories regularly provided to the CODM when managing the Company's single reporting segment. A reconciliation to consolidated operating expenses as our single segment operating loss for the years ended December 31, 2024, 2023, and 2022 is included in the table below: For the Year Ended December 31, 2024 2023 2022 (in thousands) Research and development expenses: AATD program $ 11,666 $ 8,453 $ 3,763 DMD programs 15,536 7,808 2,610 HD programs 11,790 13,086 7,952 Other research and development expenses (1) , including INHBE, RNA editing, PRISM, others 119,976 91,617 89,992 ALS and FTD programs (discontinued) 714 9,045 11,539 Total research and development expenses 159,682 130,009 115,856 General and administrative expenses 59,023 51,292 50,513 Total operating expenses $ 218,705 $ 181,301 $ 166,369 (1) Includes expenses related to other research and development programs, identification of potential drug discovery candidates, compensation-related expenses, internal manufacturing expenses, equipment repairs and maintenance expense, facility-related expenses, and other operating expenses, which are not allocated to specific programs. F- 30