What changed in this filing

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Item 1. Financial Statements

2025-05-08 compared with 2024-11-07 · 167 added, 218 removed, 258 unchanged (60% of the section changed)

3 unchanged sentences

(In thousands, except share and per share data)

September 30,

Current assets

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Operating lease right-of-use asset

Other non-current assets

LIABILITIES AND STOCKHOLDERS’ EQUITY

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Operating lease liability, current portion

Note payable, current portion

Other current liabilities

Total current liabilities

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Common stock, $ 0.0001 par value;

200,000,000 shares authorized at September 30, 2024 and December 31, 2023;

43,958,074 shares issued and outstanding at September 30, 2024;

27,613,263 shares issued and 27,607,646 shares outstanding at December 31, 2023

200,000,000 shares authorized at March 31, 2025 and December 31, 2024;

51,775,264 shares issued and outstanding at March 31, 2025;

45,756,773 shares issued and outstanding at December 31, 2024

Additional paid-in capital

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(In thousands, except share and per share data)

Three Months Ended September 30,

Nine Months Ended September 30,

License revenue

Three Months Ended March 31,

Collaboration and license revenue

Total revenue

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Condensed Consolidated Statements of Stockholders’ Equity

For the three months ended September 30, 2024 and 2023

(In thousands, except share data)

Stockholders’

Paid-In Capital

Balance at June 30, 2024

Exercise of stock options

Stock-based compensation expense

Balance at September 30, 2024

Stockholders’

Paid-In Capital

Balance at June 30, 2023

Vesting of restricted common stock

Exercise of stock options

Stock-based compensation expense

Balance at September 30, 2023

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

XILIO THERAPEUTICS, INC.

Condensed Consolidated Statements of Stockholders’ Equity

For the nine months ended September 30, 2024 and 2023

For the three months ended March 31, 2025 and 2024

(In thousands, except share data)

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Balance at December 31, 2024

Issuance of common stock and prefunded warrants in connection with the Gilead stock purchase agreement, net of issuance costs

Issuance of common stock and prefunded warrants in connection with a private placement, net of issuance costs

Issuance of common stock in connection with the AbbVie stock purchase agreement, net of issuance costs

Issuance of common stock in connection with at-the-market offerings, net of issuance costs

Issuance of common stock under employee stock purchase plan

Vesting of restricted common stock

Vesting of restricted stock units

Exercise of stock options

Stock-based compensation expense

Balance at September 30, 2024

Balance at March 31, 2025

Stockholders’

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Balance at December 31, 2023

Issuance of common stock under employee stock purchase plan

Issuance of common stock in connection with the Gilead stock purchase agreement, net of issuance costs

Vesting of restricted common stock

Exercise of stock options

Stock-based compensation expense

Balance at September 30, 2023

Balance at March 31, 2024

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

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(In thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

Cash flows from operating activities:

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Depreciation and amortization

Non-cash interest (income) expense

Stock-based compensation expense

Loss on disposal of property and equipment

Changes in operating assets and liabilities:

License agreement receivable

Prepaid and other assets

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Payments of finance lease

Proceeds from issuance of common stock under employee stock purchase plan

Proceeds from exercise of stock options

Proceeds from issuance of common stock and prefunded warrants in connection with the Gilead stock purchase agreement, net of issuance costs

Proceeds from issuance of common stock and prefunded warrants in connection with a private placement, net of issuance costs

Proceeds from issuance of common stock in connection with the Gilead stock purchase agreement, net of issuance costs

Proceeds from issuance of common stock in connection with the AbbVie stock purchase agreement, net of issuance costs

Proceeds from issuance of common stock in connection with at-the-market offerings, net of issuance costs

Net cash provided by (used in) financing activities

Net cash provided by financing activities

Increase (decrease) in cash, cash equivalents and restricted cash

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Supplemental disclosure of non-cash activities:

Transfer of finance lease asset to property and equipment

Capital expenditures included in accounts payable or accrued expenses

Reconciliation to amounts within the consolidated balance sheets:

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Since its inception, the Company has devoted substantially all of its financial resources and efforts to research and development activities.

As of September 30, 2024, the Company had an accumulated deficit of $ 370.7 million and has incurred significant operating losses, including net losses of $ 45.1 million and $ 58.7 million for the nine months ended September 30, 2024 and 2023, respectively.

As of March 31, 2025, the Company had an accumulated deficit of $ 397.0 million and has incurred significant operating losses, including net losses of $ 13.3 million and $ 17.2 million for the three months ended March 31, 2025 and 2024, respectively.

The Company expects its operating losses and negative operating cash flows to continue for the foreseeable future as it continues to advance its product candidates through clinical trials, maintains the infrastructure necessary to support these activities and continues to incur costs associated with operating as a public company.

As of September 30, 2024, the Company had cash and cash equivalents of $ 61.3 million.

Based on its current operating plans, the Company anticipates that its existing cash and cash equivalents as of September 30, 2024 will be sufficient to fund the Company’s operating expenses and capital expenditure requirements through the end of the second quarter of 2025.

As of March 31, 2025, the Company had cash and cash equivalents of $ 89.1 million.

Based on its current operating plans, the Company anticipates that its existing cash and cash equivalents as of March 31, 2025 will be sufficient to fund the Company’s operating expenses and capital expenditure requirements into the first quarter of 2026.

However, the Company has based this estimate on assumptions that may prove to be wrong, and the Company could exhaust its available capital resources sooner than it anticipates.

In addition, since these amounts are not expected to be sufficient to fund its operations for at least twelve months from the date of issuance of the condensed consolidated financial statements, there is substantial doubt about the Company’s ability to continue as a going concern.

In addition, since these amounts are not expected to be sufficient to fund its operations for at least twelve months from the date of issuance of the accompanying condensed consolidated financial statements, there is substantial doubt about the Company’s ability to continue as a going concern.

To continue to fund the operations of the Company, management has developed plans, which in the near term primarily consist of raising additional capital through one or more of the following:

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If the Company is not able to secure sufficient additional capital in the near term, the Company will need to implement additional cost reduction strategies, which could include delaying, limiting, further reducing or eliminating both internal and external costs related to its operations and research and development programs.

In addition, if the Company’s efforts to secure sufficient additional capital in the near term are unsuccessful, the Company may in the future need to seek to engage in one or more other strategic alternatives, including without limitation, the sale or divestiture of some or all of its assets or proprietary technologies.

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business.

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Basis of Presentation

The Company’s unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S.

The Company’s unaudited interim condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“U.S.

GAAP”), and pursuant to the rules and regulations of the U.S.

Securities and Exchange Commission (the “SEC”).

Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S.

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GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations.

Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2023 and notes thereto, included in the Company’s Annual Report on Form 10-K filed with the U.S.

Securities and Exchange Commission (“SEC”) on April 1, 2024.

Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2024 and notes thereto, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 11, 2025.

The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited financial statements.

In the opinion of the Company’s management, the unaudited interim condensed consolidated financial statements contain all adjustments which are necessary to present fairly the Company’s financial position as of September 30, 2024 and the results of its operations for the three and nine months ended September 30, 2024 and 2023 and cash flows for the nine months ended September 30, 2024 and 2023.

In the opinion of the Company’s management, the unaudited interim condensed consolidated financial statements contain all adjustments which are necessary to present fairly the Company’s financial position as of March 31, 2025 and the results of its operations for the three months ended March 31, 2025 and 2024 and cash flows for the three months ended March 31, 2025 and 2024.

Such adjustments are of a normal and recurring nature.

The results for the three and nine months ended September 30, 2024 are not necessarily indicative of the results for the year ending December 31, 2024 or for any future period.

The results for the three months ended March 31, 2025 are not necessarily indicative of the results for the year ending December 31, 2025 or for any future period.

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries:

Xilio Development, Inc., a Delaware corporation and Xilio Securities Corporation, a Massachusetts security corporation.

Xilio Development, Inc.

(“Xilio Development”), a Delaware corporation, and Xilio Securities Corporation, a Massachusetts security corporation.

All intercompany accounts and transactions have been eliminated in consolidation.

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The significant accounting policies used in preparation of the unaudited condensed consolidated financial statements are described in Note 2, “ Summary of Significant Accounting Policies ” of the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Except as described below, there have been no material changes to the significant accounting policies previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

Use of Estimates

The preparation of financial statements in accordance with GAAP requires management to make estimates and judgments that may affect the reported amounts of assets and liabilities and related disclosures of contingent assets and liabilities at the date of the financial statements and the related reporting of expenses during the reporting period.

Management considers many factors in selecting appropriate financial accounting policies and controls and in developing the estimates and assumptions that are used in the preparation of these condensed consolidated financial statements.

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Actual results could differ from those estimates.

Revenue Recognition

The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”).

The Company has entered into, and may in the future enter into, collaboration and licensing agreements that are within the scope of ASC 606, under which the Company has granted licenses to certain of the Company’s product candidates and performs research, development and other services in connection with such arrangements.

The terms of these arrangements may include payment of one or more of the following:

non-refundable upfront fees;

reimbursement of research and development costs;

development, regulatory and sales-based milestone payments;

and royalties on annual net sales of licensed products.

Under ASC 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services.

To determine the appropriate amount of revenue to be recognized for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps:

(i) identification of the contract with the customer;

(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.

● Performance Obligations .

The promised goods or services in the Company’s arrangements typically consist of a license, or option to license, rights to the Company’s intellectual property or research and development services.

The Company may provide options to additional items in such arrangements, which are accounted for as separate contracts when the customer elects to exercise such options, unless the option provides a material right to the customer.

Performance obligations are promised goods or services in a contract to transfer a distinct good or service to the customer and are considered distinct when (i) the customer can benefit from the good or service on its own or together with other readily available resources and (ii) the promised good or service is separately identifiable from other promises in the contract.

In assessing whether promised goods or services are distinct, the Company considers factors such as the stage of development of the underlying intellectual property, the capabilities of the customer to develop the intellectual property on its own or whether the required expertise is readily available and whether the goods or services are integral or dependent to other goods or services in the contract.

● 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 that are not determined to be material rights 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, or options 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 relative standalone selling price, which is determined based on the identified discount and the probability that the customer will exercise the option.

Amounts allocated to a material right are not recognized as revenue until, at the earliest, the option is exercised or the option expires.

● Transaction Price .

The Company estimates the transaction price based on the amount expected to be received for transferring the promised goods or services in the contract.

The consideration may include fixed consideration or variable consideration.

At the inception of each arrangement that includes variable consideration, the Company evaluates the amount of potential payments and the likelihood that the payments will be received.

The Company utilizes either the most likely amount method or expected value method to estimate the amount expected to be received based on which method best predicts the amount expected to be received.

The amount of variable consideration that is included in the transaction price may be constrained and is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period.

At the end of each subsequent reporting period, the Company reevaluates the probability of achievement of all variable consideration 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 in the period of adjustment.

The Company allocates the transaction price to the identified performance obligations based on the estimated standalone selling price.

The Company must develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract.

The Company utilizes key assumptions to determine the standalone selling price, which may include other comparable transactions, pricing considered in negotiating the transaction and the estimated costs.

Variable consideration is allocated specifically to one or more performance obligations in a contract when the terms of the variable consideration relate to the satisfaction of the performance obligation and the resulting amounts allocated are consistent with the amounts the Company would expect to receive for the satisfaction of each performance obligation.

● Milestone Payments.

At the inception of each arrangement that includes development or regulatory milestone payments, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method.

If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price.

Milestone payments that are not within the Company’s control or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until those approvals are received.

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 revenue reversal would not occur.

For arrangements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company 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 the Company’s collaboration or licensing arrangements.

● Recognition.

The consideration allocated to each performance obligation is recognized as revenue when control is transferred for the related goods or services.

For performance obligations that consist of licenses and 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.

The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition.

The Company receives payments from its customers based on billing schedules established in each contract.

Non-refundable upfront payments are included in the estimation of the transaction price, allocated to the performance obligation(s) based upon relative standalone selling price and recognized for each performance obligation based upon the measure of progress (point in time or over time) for each performance obligation.

Payments received for goods and services not yet provided are recorded as deferred revenue.

Amounts are recorded as accounts receivable when the Company’s right to consideration is unconditional.

For a discussion of accounting for collaboration and license revenues, see Note 6, Collaboration and License Agreements .

Concentrations of Credit Risk

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The Company has not experienced any losses in its cash and cash equivalents and does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships.

The Company has one operating and reportable segment, the consolidated Company operations, reflecting the integrated nature of its business focused on discovering and developing tumor-activated I-O therapies.

The Company’s chief operating decision maker (“CODM”) is its chief executive officer.

The CODM allocates resources and assesses performance on a consolidated basis, focused on the Company’s cash resources and an assessment of the probability of success of its ongoing research and development activities.

Resource allocation decisions are informed by forecasted cash expenditures and actual expenses incurred to date.

The CODM is not regularly provided with disaggregated actual expense information, other than the actual expense information included in the consolidated statements of operations and comprehensive loss, as the Company’s integrated operating model emphasizes shared resources and centralized decision-making.

All of the Company’s collaboration and license revenue is generated in the United States and all of the Company’s long-lived assets are held in the United States.

Recent Accounting Pronouncements Not Yet Adopted

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly provided to the chief operating decision maker.

The guidance is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024.

Early adoption is permitted.

The guidance is to be applied retrospectively to all prior periods presented in the financial statements.

Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption.

The Company is currently evaluating the potential impact of adopting this new guidance on its condensed consolidated financial statements and related disclosures.

In December 2023, the FASB issued ASU No.

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ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted.

This Company is currently evaluating the potential impact of adopting this new guidance on its condensed consolidated financial statements and related disclosures.

The Company is currently evaluating the potential impact of adopting this new guidance on its condensed consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU No.

2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses (“ASU 2024-03”), and in January 2025, the FASB issued ASU No.

2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Clarifying the Effective Date (“ASU 2025-01”).

ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement.

ASU 2024-03, as clarified by ASU 2025-01, is effective for public companies for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.

Early adoption is permitted.

The Company is currently evaluating the potential impact of adopting this new guidance on its condensed consolidated financial statements and related disclosures.

Property and Equipment, Net

Property and equipment, net consists of the following as of September 30, 2024 and December 31, 2023:

September 30,

Property and equipment, net consists of the following as of March 31, 2025 and December 31, 2024:

Laboratory equipment

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Property and equipment, net

The Company recognized depreciation and amortization expense related to property and equipment of $ 1.2 million and $ 1.4 million for the nine months ended September 30, 2024 and 2023, respectively.

Accrued Expenses and Restructuring

Accrued expenses consist of the following as of September 30, 2024 and December 31, 2023:

September 30,

The Company recognized depreciation and amortization expense related to property and equipment of $ 0.5 million and $ 0.4 million for the three months ended March 31, 2025 and 2024, respectively.

Accrued Expenses

Accrued expenses consist of the following as of March 31, 2025 and December 31, 2024:

External research and development

Personnel-related

Restructuring

Professional and consulting fees

Total accrued expenses

In March 2024, the Company’s board of directors approved a strategic portfolio reprioritization and workforce reduction.

As part of the workforce reduction, the Company recognized restructuring charges of $ 0.9 million during the nine months ended September 30, 2024, primarily related to employee severance, benefits continuation and outplacement service costs.

The workforce reduction was completed in April 2024.

The Company made payments of $ 0.9 million related to the restructuring during the nine months ended September 30, 2024.

All remaining employee severance, benefits continuation and outplacement service cost payments were completed in October 2024.

The following table summarizes the accrued restructuring liability activity for the Company’s workforce reduction for the nine months ended September 30, 2024:

Severance and

Related Benefits

Accrued restructuring liability as of December 31, 2023

Restructuring charges

Restructuring payments

Accrued restructuring liability as of September 30, 2024

Loan and Security Agreement

In November 2019, the Company’s wholly owned subsidiary, Xilio Development, Inc.

(“Xilio Development”), entered into a loan and security agreement (as amended and restated in May 2023, the “Loan Agreement”) with Pacific Western Bank (“PacWest”), with the Company as a guarantor, and borrowed $ 10.0 million under a term loan.

Interest on amounts outstanding under the Loan Agreement accrued at a variable annual rate equal to the greater of (i) the prime rate plus 0.25 % or (ii) 4.75 %.

In the first quarter of 2024, Xilio Development repaid all amounts outstanding under the Loan Agreement, and PacWest released all security interests in Xilio Development’s and its affiliates’ assets.

The Company recognized $ 0.1 million and $ 0.6 million of interest expense related to the Loan Agreement for the nine months ended September 30, 2024 and 2023, respectively, which is reflected in other income, net on the condensed consolidated statements of operations and comprehensive loss.

Collaboration and License Agreements

Collaboration, License and Option Agreement with AbbVie

In February 2025, Xilio Development entered into a collaboration, license and option agreement (the “Collaboration Agreement”) with AbbVie Group Holdings (“AbbVie”) for up to four programs leveraging the Company’s proprietary tumor-activation technology and platform, consisting of (i) an exclusive license for a program to develop and commercialize a masked antibody-based immunotherapy (the “Collaboration Program”) and (ii) an exclusive option for (a) an initial program to discover, develop and commercialize masked T cell engager molecules for an agreed upon initial target and backup target (“Initial Option Program”), and (b) subject to the terms of the Collaboration Agreement, up to two additional programs (each, an “Additional Option Program” and together with the Initial Option Program, the “Option Programs”).

In connection with the Collaboration Program, Xilio Development is responsible for conducting all preclinical development through lead generation (“Collaboration Program Services”).

For the Initial Option Program, AbbVie’s option right is exercisable beginning on the effective date of the Collaboration Agreement, and for each Additional Option Program, AbbVie’s option right is exercisable following delivery of written notice of nomination of such Additional Option Program.

During the three-year period following the effective date of the Collaboration Agreement, AbbVie has the right to initiate up to two Additional Option Programs by (a) selecting an initial target and backup target for each such Additional Option Program (excluding the target known as prostate-specific membrane antigen and any other target for which Xilio Development has completed specified activities prior to lead selection) and (b) paying Xilio Development an additional program nomination fee for each Additional Option Program.

For each Option Program, prior to option exercise, Xilio Development is responsible for conducting preclinical discovery and development up to the completion of investigational new drug application (“IND”) enabling studies, subject to AbbVie paying Xilio Development option extension fees upon completion of specified stages of preclinical discovery and development (“Option Program Services”).

Unless AbbVie elects to extend preclinical development through the next stage and pays the applicable option extension fee, AbbVie’s option right terminates within a specified time period following completion of each stage of preclinical development.

Upon exercising its option for an Option Program, AbbVie will be responsible for any remaining preclinical development, if applicable, and all clinical development, regulatory and commercialization activities with respect to licensed products under the applicable Option Program.

In addition, on an Option Program-by-Option Program basis, prior to the initiation of specified activities related to lead optimization and selection for the initial target for such Option Program, AbbVie has a one-time right to substitute the initial target with the backup target agreed upon by the parties at the time of Option Program initiation, subject to the payment by AbbVie of a one-time substitution fee with respect to such substituted target and the other terms of the Collaboration Agreement.

In connection with the execution of the Collaboration Agreement, in February 2025, the Company also entered into a stock purchase agreement with AbbVie Inc.

pursuant to which the Company issued and sold 4,347,826 shares of its common stock to AbbVie Inc.

in a private placement at a purchase price of $ 2.30 per share for an aggregate purchase price of $ 10.0 million.

As of March 31, 2025, the Company has received $ 52.0 million in payments under the AbbVie agreements, consisting of a $ 42.0 million upfront cash payment under the Collaboration Agreement and $ 10.0 million in gross proceeds from the private placement under the stock purchase agreement.

In addition, as of March 31, 2025, the Company is eligible to receive up to approximately $ 2.1 billion in additional contingent payments under the Collaboration Agreement, consisting of (i) up to $ 305.0 million in aggregate program nomination fees, preclinical development option extension fees and option fees for the Option Programs and (ii) up to $ 1.8 billion in aggregate development, regulatory and sales-based milestones for all Option Programs and the Collaboration Program.

In addition, the Company is eligible to receive tiered royalties ranging in the high single digits on annual global net product sales for the Option Program and is eligible to receive tiered royalties ranging in the mid-single digits on annual global net product sales for the Collaboration Program.

The Company considered the criteria of ASC 606, Revenue from Contracts with Customers (“ASC 606”) for combining contracts and determined the Collaboration Agreement and the stock purchase agreement should be combined into a single contract because they were negotiated and entered into in contemplation of one another.

The Company accounted for the common stock issued to AbbVie Inc.

based on the fair market value of the common stock on the date of issuance.

The fair market value of the common stock issued to AbbVie Inc.

was $ 2.9 million, based on the closing price of the Company’s common stock on the date of issuance, resulting in a $ 7.1 million premium.

The Company determined that the premium paid by AbbVie Inc.

for the common stock purchased should be attributed to the transaction price of the Collaboration Agreement.

The Company determined that the Collaboration Agreement represents a contract with a customer within the scope of ASC 606 and identified the following promises under the Collaboration Agreement:

(i) the exclusive license granted to AbbVie related to the Collaboration Program, (ii) the Collaboration Program Services and (iii) the Option Program Services for the Initial Option Program.

In addition, the Company identified several customer options that were evaluated to determine if such options represented material rights, each of which would be considered a performance obligation at contract inception only if the option provides a material right to AbbVie that it would not receive without entering into that contract.

The Company determined that the exclusive license and development services related to the Collaboration Program Services were not capable of being distinct on the basis that the services to be provided by Xilio Development are specialized in nature, specifically with respect to its specialized expertise in developing masked antibody-based immunotherapies and the Company’s proprietary platform for tumor-activated biologics.

Accordingly, the Company concluded that these promises should be a combined performance obligation consisting of the exclusive license and the development services for the Collaboration Program Services.

As such, the Company identified the following performance obligations at contract inception:

(i) the performance obligation consisting of the exclusive license and the Collaboration Program Services (the “Collaboration Program Performance Obligation”);

(ii) the Option Program Services for the Initial Option Program (the “Initial Option Program Performance Obligation”);

(iii) a material right to receive an exclusive license to the Initial Option Program;

(iv) a material right to receive additional services related to the Initial Option Program;

and (v) a material right related to AbbVie’s one-time right to substitute the initial target with the backup target

for the Initial Option Program.

For purposes of ASC 606, the transaction price at the outset of the arrangement was determined to be $ 49.1 million, which consisted of the upfront cash payment of $ 42.0 million under the Collaboration Agreement and the $ 7.1 million premium on the sale of common stock to AbbVie Inc.

The Company used the most likely amount method to estimate variable consideration.

All contingent payments are fully constrained as of March 31, 2025, as the achievement of the milestones underlying such contingent payments is based on either the Company or AbbVie’s ability to execute under the development plan which is not certain at contact inception.

Accordingly, all such contingent payments are excluded from the transaction price.

The Company reevaluates the transaction price at the end of each reporting period and as uncertain events are resolved or other changes in circumstances occur and may adjust the transaction price as necessary.

Sales-based royalties, including milestone payments based on the level of sales, were also excluded from the transaction price, as the license is deemed to be the predominant item to which the royalties relate.

The Company plans to recognize such 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).

The Company allocated the transaction price to the performance obligations on a relative selling price basis as follows:

(i) $ 32.4 million related to the Collaboration Program Performance Obligation;

(ii) $ 6.9 million related to the Initial Option Program Performance Obligation;

(iii) $ 8.2 million related to the material right to receive an exclusive license to the Initial Option Program;

(iv) $ 1.1 million related to the material right to receive additional services related to the Initial Option Program;

and (v) $ 0.5 million related to the material right for AbbVie’s one-time right to substitute the initial target with the backup target for the Initial Option Program.

The Company determined the estimated standalone selling price for the licenses using an adjusted market assessment approach, whereby the Company adjusted a comparable transaction previously entered into by the Company and comparable third-party transactions to reflect the stage of development of the Company’s assets under the Collaboration Agreement.

The Company determined the estimated standalone selling price for services based on estimated costs to be incurred plus a reasonable margin.

The Company determined the estimated standalone selling price for material rights by estimating the standalone selling price of the underlying performance obligations included in the material right and estimating the probability that AbbVie will exercise such material right.

Revenue associated with the Collaboration Program Performance Obligation and the Initial Option Program Performance Obligation are recognized as the underlying services are provided as control is transferred over time.

The Company measures progress based on the amount of costs incurred relative to the total costs expected to fulfill the combined performance obligation.

In management’s judgment, this input method is the best measure of progress towards satisfying the combined performance obligation and reflects a faithful depiction of the transfer of goods and services.

Revenue associated with the material rights will be recognized upon expiry if the option is not exercised.

If the material right is exercised, the Company will evaluate the performance obligations underlying the option exercised and recognize the amount allocated to the material right and any additional consideration over the appropriate recognition period associated with the underlying performance obligations.

During the three months ended March 31, 2025, the Company recognized collaboration revenue of $ 0.7 million under the Collaboration Agreement and the stock purchase agreement.

As of March 31, 2025, the Company recorded deferred revenue of $ 48.4 million, of which $ 25.6 million was recorded as a current liability on the Company’s condensed consolidated balance sheet.

The deferred revenue is expected to be recognized as revenue through at least 2026 depending on (i) the timing of services being provided for the Collaboration Program and the Initial Option Program and (ii) the timing of AbbVie’s exercise or expiration of the material rights.

License Agreement with Gilead Sciences, Inc.

In March 2024, Xilio Development entered into a license agreement with Gilead Sciences, Inc (“Gilead”), pursuant to which it granted Gilead an exclusive global license to develop and commercialize XTX301, the Company’s tumor-activated IL-12 product candidate, and specified other molecules directed to IL-12.

In March 2024, Xilio Development entered into a license agreement with Gilead Sciences, Inc.

(“Gilead”), pursuant to which it granted Gilead an exclusive global license to develop and commercialize XTX301, the Company’s tumor-activated IL-12 product candidate, and specified other molecules directed to IL-12.

Xilio Development is responsible for conducting clinical development for XTX301 in the ongoing Phase 1 clinical trial through an initial planned Phase 2 dose expansion clinical trial.

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In connection with the execution of the license agreement, in March 2024, the Company also entered into a stock purchase agreement with Gilead.

Under the stock purchase agreement, Gilead agreed to purchase up to an aggregate of $ 25.0 million of the Company’s common stock (or at Gilead’s election, prefunded warrants in lieu of shares of common stock) in an initial private placement in connection with the execution of the license agreement and in up to three additional private placements through March 2025 at a predetermined mechanism for the purchase price per share, at all times subject to Gilead not being deemed the beneficial owner of greater than 19.9 % of the Company’s common stock upon the closing of the applicable private placement.

In March 2024, the Company initially issued and sold 6,860,223 shares of common stock to Gilead at a purchase price of $ 1.97 per share and received approximately $ 13.5 million in aggregate gross proceeds.

In April 2024, the Company exercised its right to a first additional private placement with Gilead and received approximately

$ 3.3 million in aggregate gross proceeds from the issuance and sale of an additional 485,250 shares of its common stock at a purchase price of $ 0.76 per share and prefunded warrants to purchase up to an aggregate of 3,882,450 shares of its common stock at a purchase price of $ 0.7599 per prefunded warrant.

Under the stock purchase agreement, Gilead purchased $ 25.0 million of the Company’s common stock and prefunded warrants in three private placements, consisting of an aggregate of 9,105,451 shares of common stock and prefunded warrants to purchase up to an aggregate of 9,975,266 shares of its common stock.

The prefunded warrants are exercisable any time at an exercise price of $ 0.0001 per share, subject to Gilead not being deemed a beneficial owner of greater than 19.9 % of the Company’s common stock upon the exercise of the prefunded warrants.

As of September 30, 2024, the Company has received approximately $ 46.8 million in payments under the Gilead agreements, consisting of the $ 30.0 million upfront cash payment under the license agreement and approximately $ 16.8 million in gross proceeds from private placements under the stock purchase agreement.

As of September 30, 2024, the Company is eligible to receive up to $ 600.7 million in additional contingent payments, which consist of (i) approximately $ 8.2 million in proceeds from up to two additional private placements, (ii) the $ 75.0 million transition fee and (iii) up to $ 517.5 million in specified development, regulatory and sales-based milestones.

Prior to the potential transition fee, up to $ 25.7 million of the total additional contingent payments are related to the potential additional private placements and a near-term development milestone.

As of March 31, 2025, the Company has received $ 55.0 million in payments under the Gilead agreements, consisting of the $ 30.0 million upfront cash payment under the license agreement and $ 25.0 million in gross proceeds from private placements under the stock purchase agreement.

As of March 31, 2025, the Company is eligible to receive up to $ 592.5 million in additional contingent payments, which consist of the $ 75.0 million transition fee and up to $ 517.5 million in specified development, regulatory and sales-based milestones.

Prior to the potential transition fee, up to $ 17.5 million of the total additional contingent payments are related to a near-term development milestone.

In addition, the Company is eligible to receive tiered royalties ranging from high single digits to mid-teens on annual global net product sales.

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The Company used the most likely amount method to estimate variable consideration.

All contingent payments are fully constrained as of September 30, 2024, as the achievement of the milestones underlying such contingent payments is uncertain and highly susceptible to factors outside of the Company’s control.

All contingent payments are fully constrained as of March 31, 2025, as the achievement of the milestones underlying such contingent payments is uncertain and highly susceptible to factors outside of the Company’s control.

Accordingly, all such contingent payments are excluded from the transaction price.

The Company reevaluates the

transaction price at the end of each reporting period and as uncertain events are resolved or other changes in circumstances occur and may adjust the transaction price as necessary.

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The Company measures progress based on the amount of costs incurred relative to the total costs expected to fulfill the combined performance obligation.

In management’s judgment, this input method is the best measure

of progress towards satisfying the combined performance obligation and reflects a faithful depiction of the transfer of goods and services.

During the three and nine months ended September 30, 2024, the Company recognized license revenue of $ 2.3 million and $ 4.6 million, respectively, under the license agreement and the stock purchase agreement.

As of September 30, 2024, the Company recorded deferred revenue of $ 34.5 million, of which $ 26.1 million was recorded as a current liability on the Company’s condensed consolidated balance sheet.

During the three months ended March 31, 2025, the Company recognized collaboration and license revenue of $ 2.2 million under the license agreement and the stock purchase agreement with Gilead.

During the three months ended March 31, 2024, the Company did not recognize any collaboration and license revenue under the license agreement and the stock purchase agreement with Gilead As of March 31, 2025, the Company recorded deferred revenue under the license agreement and the stock purchase agreement of $30.6 million, of which $ 14.7 million was recorded as a current liability on the Company’s condensed consolidated balance sheet.

The deferred revenue is expected to be recognized as collaboration and license revenue through at least 2027 depending on the timing of certain clinical development activities.

Summary of Contract Assets and Liabilities

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Deferred revenue as of December 31, 2024

License revenue recognized

Deferred revenue as of September 30, 2024

Collaboration and license revenue recognized

Deferred revenue as of March 31, 2025

Clinical Trial Collaboration with F.

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In July 2023, the Company and F.

Hoffmann-La Roche Ltd.

(“Roche”) entered into a clinical trial collaboration (the “Roche Clinical Collaboration”) pursuant to a clinical supply agreement to evaluate vilastobart (XTX101) in combination with atezolizumab (Tecentriq®) in a Phase 1/2 clinical trial consisting of Phase 1 dose escalation assessing the combination in patients with advanced solid tumors and Phase 2 assessing the combination in patients with microsatellite stable colorectal cancer.

Hoffmann-La Roche Ltd (“Roche”) entered into a clinical trial collaboration pursuant to a clinical supply agreement to evaluate vilastobart in combination with atezolizumab (Tecentriq®) in a Phase 1/2 clinical trial consisting of Phase 1 dose escalation assessing the combination in patients with advanced solid tumors and Phase 2 assessing the combination in patients with microsatellite stable colorectal cancer.

Under the clinical supply agreement, the Company is eligible to receive specified cost-sharing payments from Roche, and each company will supply its respective anti-cancer agent to support the Phase 1/2 clinical trial.

The Company is responsible for sponsoring and conducting the Phase 1/2 clinical trial and retains global development and commercialization rights to vilastobart.

The Company concluded that the cost-sharing payments from the Roche Clinical Collaboration are not in the scope of ASC 606 because the Company does not consider performing research and development services for reimbursement to be part of its ongoing major or central operations.

Therefore, the Company applied a reasonable, rational, and consistently applied accounting policy election to record the cost-sharing payments from the Roche Clinical Collaboration as a reduction of research and development expenses in the condensed consolidated statements of operations and comprehensive loss for the period in which a study development event is achieved.

During the three months ended September 30, 2024, the Company did not recognize a reduction of research and development expenses under the Roche Clinical Collaboration.

During the three months ended September 30, 2023, the Company recognized a reduction of research and development expenses of $ 2.0 million under the Roche Clinical Collaboration.

During each of the nine months ended September 30, 2024 and 2023, the Company recognized a reduction of research and development expenses of $ 2.0 million under the Roche Clinical Collaboration.

The Company is responsible for conducting the Phase 1/2 clinical trial and retains global development and commercialization rights to vilastobart.

The Company concluded that the cost-sharing payments under the clinical supply agreement are not in the scope of ASC 606 because the Company does not consider performing research and development services for reimbursement to be part of its ongoing major or central operations.

Therefore, the Company applied a reasonable, rational, and consistently applied accounting policy election to record the cost-sharing payments under the clinical supply agreement as a reduction of research and development expenses in the condensed consolidated statements of operations and comprehensive loss for the period in which a study development event is achieved.

The Company recognized a reduction of research and development expense of $ 2.0 million during each of the three months ended March 31, 2025 and 2024.

As of each of March 31, 2025 and 2024, $ 2.0 million of earned but unpaid cost-sharing payments were included in prepaid expenses and other current assets of the Company’s condensed consolidated balance sheets.

Commitments and Contingencies

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The Company has an option to extend the lease for an additional term of five years at then-market rates.

The Company is obligated to pay its portion of real estate taxes and costs related to the premises, including costs of operations, maintenance, repair, replacement, and management of the leased premises, which it began paying simultaneous

with the rent commencement date in March 2020.

As of September 30, 2024 and December 31, 2023, the Company had a letter of credit for the benefit of its landlord in the amount of $ 1.6 million, collateralized by a money market account, which is recorded as restricted cash on the condensed consolidated balance sheets.

As of March 31, 2025 and December 31, 2024, the Company had a letter of credit for the benefit of its landlord in the amount of $ 1.8 million, collateralized by a money market account, which is recorded as restricted cash on the condensed consolidated balance sheets.

Preferred Stock and Common Stock

Undesignated Preferred Stock

As of September 30, 2024 and December 31, 2023, the Company’s certificate of incorporation, as amended, authorized the Company to issue up to 5,000,000 shares of undesignated preferred stock at $ 0.0001 par value per share.

As of September 30, 2024 and December 31, 2023, there were no shares of preferred stock issued or outstanding.

As of September 30, 2024 and December 31, 2023, the Company is authorized to issue up to 200,000,000 shares of common stock, $ 0.0001 par value per share under its certificate of incorporation, as amended.

As of March 31, 2025 and December 31, 2024, the Company’s certificate of incorporation, as amended, authorizes the Company to issue up to 5,000,000 shares of undesignated preferred stock at $ 0.0001 par value per share.

As of March 31, 2025 and December 31, 2024, there were no shares of preferred stock issued or outstanding.

As of March 31, 2025 and December 31, 2024, the Company is authorized to issue up to 200,000,000 shares of common stock, $ 0.0001 par value per share under its certificate of incorporation, as amended.

Private Placement

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The shares of common stock issued and sold in the private placement were registered for resale pursuant to the Company’s registration statement on Form S-3 filed with the SEC on April 30, 2024, which became effective on May 6, 2024.

Sales Agreement

In November 2022, the Company filed a universal shelf registration statement on Form S-3 with the SEC to register for sale up to $ 250,000,000 of its common stock, preferred stock, debt securities, units and warrants, which the Company may issue and sell from time to time in one or more offerings, which became effective on November 18, 2022 (333-268264).

In November 2022, the Company also entered into a sales agreement (the “Sales Agreement”) with Cowen and Company LLC, under which the Company may issue and sell shares of its common stock at prevailing market prices from time to time, having an aggregate offering price of up to $ 75.0 million, subject to the terms and conditions of the Sales Agreement.

Issuances or sales of common stock pursuant to the Sales Agreement are made under the Form S-3 and the corresponding prospectus related to the Sales Agreement, as supplemented by a prospectus supplement filed on April 15, 2024.

During the nine months ended September 30, 2024, the Company issued and sold 7,000,000 shares of its common stock pursuant to the Sales Agreement at a weighted average price of $ 1.00 per share for aggregate gross proceeds of $ 7.0 million, before deducting commissions.

The Company did no t sell any shares of its common stock pursuant to the Sales Agreement during the three months ended September 30, 2024.

“At-The-Market” Offering Program

In November 2022, the Company filed a universal shelf registration statement on Form S-3 with the SEC to register for sale up to $ 250.0 million of its common stock, preferred stock, debt securities, units and warrants, which the Company could issue and sell from time to time in one or more offerings, which became effective on November 18, 2022 (333-268264) (the “Prior S-3 Shelf”).

In November 2022, the Company entered into a sales agreement (the “Cowen Sales Agreement”) with Cowen and Company LLC under which the Company could issue and sell shares of its common stock, from time to time, having an aggregate offering price of up to $ 75.0 million under a sales agreement prospectus filed as part of the Prior S-3 Shelf.

During the year ended December 31, 2024, the Company issued and sold 7,000,000 shares of its common stock pursuant to the Cowen Sales Agreement at a price of $ 1.00 per share for aggregate gross proceeds of $ 7.0 million.

During the three months ended March 31, 2025, the Company issued and sold an additional 1,550,000 shares of its common stock pursuant to the Cowen Sales Agreement at a weighted average price of $ 1.3348 per share for aggregate gross proceeds of approximately $ 2.1 million.

In March 2025, the Company filed a universal shelf registration statement on Form S-3 with the SEC to register for sale up to $ 250.0 million of its common stock, preferred stock, debt securities, units and warrants, which the Company may issue and sell from time to time in one or more offerings, which became effective on May 8, 2025 (333-285703) (the “New S-3 Shelf”).

In March 2025, the Company terminated the Cowen Sales

Agreement, and the Company entered into a new sales agreement with Leerink Partners, LLC (the “Leerink Sales Agreement”), under which the Company may issue and sell shares of its common stock from time to time at an aggregate offering price of up to $ 50.0 million.

Prior to the effectiveness of the New S-3 Shelf, the offering of shares under the Leerink Sales Agreement was registered under the Prior S-3 Shelf.

In connection with the effectiveness of the New S-3 Shelf, the registration of such offering under the Prior S-3 Shelf was terminated and such offering was registered under the New S-3 Shelf.

Shares Reserved for Future Issuance

The Company has reserved for future issuances the following shares of common stock as of September 30, 2024 and December 31, 2023:

September 30,

The Company has reserved for future issuances the following shares of common stock underlying the securities issued below as of March 31, 2025 and December 31, 2024:

Stock options and unvested restricted stock units

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On January 1, 2025, the number of shares reserved for issuance under the 2021 Plan automatically increased by 2,293,405 shares.

As of September 30, 2024, there were 2,157,814 shares of common stock available for future issuance under the 2021 Plan.

As of March 31, 2025, there were 2,217,457 shares of common stock available for future issuance under the 2021 Plan.

2022 Inducement Plan

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In accordance with Rule 5635(c)(4), stock-based incentive awards under the 2022 Inducement Plan may only be made to a newly hired employee who has not previously been a member of the Company’s board of directors, or an employee who is being rehired following a bona fide period of non-employment by the Company as a material inducement to the employee’s entering into employment with the Company.

An aggregate of 275,000 shares of the Company’s common stock has been reserved for issuance under the 2022 Inducement Plan.

As of September 30, 2024, there were 220,000 shares of common stock available for future issuance under the 2022 Inducement Plan.

The Company initially reserved 275,000 shares of the Company’s common stock for issuance under the 2022 Inducement Plan.

In November 2024, the number of shares reserved for issuance under the 2022 Inducement Plan increased by 500,000 shares.

In March 2025, the number of shares reserved for issuance under the 2022 Inducement Plan increased by an additional

500,000 shares.

As of March 31, 2025, there were 592,200 shares of common stock available for future issuance under the 2022 Inducement Plan.

2021 Employee Stock Purchase Plan

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The Company initially reserved 292,031 shares of common stock for issuance under the 2021 ESPP.

The 2021 ESPP provides that the number of shares of common stock reserved for issuance under the 2021 ESPP will be cumulatively increased on January 1 of each calendar year by 1 %

of the number of shares of the Company’s common stock outstanding on such date or such lesser amount determined by the Company’s board of directors (up to a maximum increase of 584,062 shares of common stock per year).

The 2021 ESPP provides that the number of shares of common stock reserved for issuance under the 2021 ESPP will be cumulatively increased on January 1 of each calendar year by 1 % of the number of shares of the Company’s common stock outstanding on such date or such lesser amount determined by the Company’s board of directors (up to a maximum increase of 584,062 shares of common stock per year).

On January 1, 2025, the number of shares reserved for issuance under the 2021 ESPP was increased by 458,681 shares.

During the nine months ended September 30, 2024 and 2023, the Company issued 38,998 shares of common stock and 68,929 shares of common stock under the 2021 ESPP, respectively.

As of September 30, 2024, there were 938,378 shares of common stock available for future issuance under the 2021 ESPP.

As of March 31, 2025, there were 1,359,889 shares available for future issuance under the 2021 ESPP.

Stock-Based Compensation Expense

During the three and nine months ended September 30, 2024 and 2023, the Company recorded compensation expense related to stock options, restricted stock units and restricted common stock for employees and non-employees and share purchases under the 2021 ESPP for employees, which was allocated as follows in the condensed consolidated statements of operations and comprehensive loss:

Three Months Ended September 30,

Nine Months Ended September 30,

During the three months ended March 31, 2025 and 2024, the Company recorded compensation expense related to stock options, restricted stock units and restricted common stock for employees and non-employees and share purchases under the 2021 ESPP for employees, which was allocated as follows in the condensed consolidated statements of operations and comprehensive loss:

Three Months Ended March 31,

Research and development expense

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Outstanding as of December 31, 2024

Cancelled/forfeited

( 1,528,062 )

Outstanding as of September 30, 2024

Exercisable as of September 30, 2024

Outstanding as of March 31, 2025

Exercisable as of March 31, 2025

(1) The aggregate intrinsic value of stock options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock for those stock options that had exercise prices lower than the fair value of the Company’s common stock as of the end of the period.

Using the Black-Scholes option pricing model, the weighted average fair value of options granted to employees and directors during the nine months ended September 30, 2024 and 2023 was $ 0.68 and $ 2.02 , respectively.

The following assumptions were used in determining the fair value of options granted during the nine months ended September 30, 2024 and 2023:

Nine Months Ended September 30,

Using the Black-Scholes option pricing model, the weighted average fair value of options granted to employees and directors during the three months ended March 31, 2025 and 2024 was $ 0.74 per share and $ 0.41 per share, respectively.

The following assumptions were used in determining the fair value of options granted during the three months ended March 31, 2025 and 2024:

Three Months Ended March 31,

Risk-free interest rate

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Expected volatility

As of September 30, 2024, the Company had unrecognized stock-based compensation expense of $ 7.0 million related to stock options issued to employees and directors, which is expected to be recognized over a weighted-average period of 2.1 years.

As of March 31, 2025, the Company had unrecognized stock-based compensation expense of $ 6.0 million related to stock options issued to employees and directors, which is expected to be recognized over a weighted-average period of 2.4 years.

Restricted Stock Units

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Unvested as of December 31, 2024

Unvested as of September 30, 2024

For the nine months ended September 30, 2024, the Company recognized less than $ 0.1 million of stock-based compensation expense related to these awards.

As of September 30, 2024, the Company had unrecognized stock-based compensation expense of $ 0.2 million related to these restricted stock units, which is expected to be recognized over 3.3 years.

Restricted Common Stock

A summary of the Company’s restricted common stock activity and related information is as follows:

of Restricted

Unvested as of December 31, 2023

Unvested as of September 30, 2024

In June 2020, the Company granted 552,546 shares of common stock underlying restricted stock awards, and the Company has not subsequently granted any additional restricted stock awards.

The aggregate fair value of the restricted stock awards that vested during the nine months ended September 30, 2024 and 2023 was less than $ 0.1 million.

Unvested as of March 31, 2025

For each of the three months ended March 31, 2025 and 2024, the Company recognized less than $ 0.1 million of stock-based compensation expense related to these awards.

As of March 31, 2025, the Company had unrecognized stock-based compensation expense of $ 0.2 million related to these restricted stock units, which is expected to be recognized over 2.8 years.

Net Loss Per Share

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The weighted average number of shares of common stock used in the basic and diluted net loss per share calculation includes the prefunded warrants issued in connection with the Company’s private placements with certain existing investors and Gilead, as the prefunded warrants are exercisable at any time for nominal cash consideration.

As of September 30, 2024, no prefunded warrants have been exercised and 19,509,891 prefunded warrants are outstanding.

The following table sets forth the outstanding shares of common stock equivalents, presented based on amounts outstanding at each period end, that were excluded from the calculation of diluted net loss per share attributable to common stockholders during each period because including them would have been anti-dilutive:

Nine Months Ended

September 30,

As of March 31, 2025, no prefunded warrants have been exercised and 25,602,707 prefunded warrants are outstanding.

The following table sets forth the outstanding shares of common stock equivalents, presented based on amounts outstanding at each period end, that were excluded from the calculation of diluted net loss per share for the periods indicated because including them would have been anti-dilutive:

Three Months Ended

Unvested restricted common stock

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

What changed 10-Q

Item 1. Financial Statements