# Protagonist Therapeutics, Inc: Form 10-Q for the period ended Mar 31, 2025

- Company: [Protagonist Therapeutics, Inc](/companies/ptgx.md) (CIK 1377121)
- Form: 10-Q
- Filed: 2025-05-06
- Accepted by EDGAR: May 6, 2025, 17:04 ET
- Period: 2025-03-31
- Accession: 0001558370-25-006530
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1377121/000155837025006530/ptgx-20250331x10q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1377121/000155837025006530/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-03-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2025-01-01 to 2025-03-31 | $28.3m | us-gaap:RevenueFromContractWithCustomerIncludingAssessedTax |
| Research and development | 3 months, 2025-01-01 to 2025-03-31 | $35.9m | us-gaap:ResearchAndDevelopmentExpense |
| Operating income | 3 months, 2025-01-01 to 2025-03-31 | −$19.3m | us-gaap:OperatingIncomeLoss |
| Income tax | 3 months, 2025-01-01 to 2025-03-31 | $0 | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2025-01-01 to 2025-03-31 | −$11.7m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2025-01-01 to 2025-03-31 | −$0.19 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2025-01-01 to 2025-03-31 | −$0.19 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2025-01-01 to 2025-03-31 | 62,963,806 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 3 months, 2025-01-01 to 2025-03-31 | $125.4m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 3 months, 2025-01-01 to 2025-03-31 | $545.0k | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Cash and equivalents | at 2025-03-31 | $139.7m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2025-03-31 | $605.9m | us-gaap:AssetsCurrent |
| Total assets | at 2025-03-31 | $742.1m | us-gaap:Assets |
| Current liabilities | at 2025-03-31 | $35.1m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2025-03-31 | $53.1m | us-gaap:Liabilities |
| Shareholders' equity | at 2025-03-31 | $689.1m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 52,072 characters.

*You should read the following discussion and analysis of our financial condition and results of operations together with our Unaudited Condensed Consolidated Financial Statements and related notes included in Part I, Item 1 of this quarterly report on Form 10-Q (the “Quarterly Report”) and with our Audited Consolidated Financial Statements and related notes thereto for the year ended December 31, 2024, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 21, 2025.*

### Forward-Looking Statements

*This Quarterly Report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical fact, including statements concerning our plans, objectives, goals, strategies, future events, future revenues or performance, financing needs, expectations, plans or intentions relating to clinical development, product candidates, the regulatory approval process, products and markets, and business trends and other information referred to under the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” are forward-looking statements. These statements are subject to substantial known and unknown risks, uncertainties and other factors that may cause our actual results, outcomes, performance or achievements, or the timing of such results, outcomes, performance or achievements, to be materially different from any results, outcomes, performances or achievements expressed or implied by the forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “anticipates,” “assumes,” “believes,” “commitments,” “could,” “estimates,” “expects,” “forecasts,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “targets,” “will,” “would,” “seeks” and similar expressions intended to identify forward-looking statements. Forward-looking statements reflect our current views with respect to future events, are based on assumptions, and are subject to risks, uncertainties and other important factors, including, among other things, the potential for our programs; the timing, initiation, progress and expected results of our clinical trials and research and development programs, including enrollment, data, costs and regulatory submissions; our cash runway; our ability to advance product candidates into, and successfully complete, nonclinical studies and clinical trials; the potential for eventual regulatory approval and commercialization of our product candidates; the commercialization of our product candidates, if approved; our ability and the potential to successfully manufacture and supply our product candidates for clinical trials and for commercial use, if approved; the pricing, coverage, and reimbursement of our product candidates, if approved; our potential receipt of milestone payments and royalties under our collaboration agreements; future operating results; our ability to generate sales, income or cash flow; our estimates regarding expenses, capital requirements, and needs for additional financing and our ability to obtain additional capital; our ability to retain the continued service of our key executives and to identify, hire, and retain additional qualified professionals; the impact of any future outbreaks of disease, epidemics and pandemics; changes in the U.S. Food and Drug Administration (the “FDA”), and other government agencies; ongoing military conflicts, including between Ukraine and Russia and in the Middle East; rising tensions between China and Taiwan; developments relating to our competitors and our industry, including competing product candidates and therapies; uncertainty and disruption in the global economy and financial markets due to a number of factors, including geopolitical instability, inflationary pressures, high interest rates, a recessionary environment, domestic and global monetary and fiscal policy, changes in trade policies, including tariffs or other trade restrictions or the threat of such actions, and banking and other financial institution instability; and other factors. Forward-looking statements involve risks, uncertainties and assumptions that are beyond our ability to control or predict, including those risks, uncertainties and assumptions discussed in Part II, Item 1A, of this Quarterly Report. These statements are based on information available to us as of the date of this Quarterly Report and, while we believe such information provides a reasonable basis for these statements, the information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. Given these risks, uncertainties and other important factors, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our estimates and assumptions only as of the date of this Quarterly Report. Except as required by law, we assume no obligation to update any forward-looking statements publicly, or to update the reasons actual results or outcomes could differ materially from those anticipated in any* *forward-looking statements, whether as a result of new information, future developments, changes in assumptions or otherwise.*

*“Protagonist,” the Protagonist logo and other trademarks, service marks and trade names of Protagonist are registered and unregistered marks of Protagonist Therapeutics, Inc. in the United States and other jurisdictions.*

### Overview

We are a discovery through late-stage development biopharmaceutical company focused on peptide therapeutics. Our clinical programs fall into two broad categories of diseases: (i) inflammatory and immunomodulatory (“I&I”) diseases, and (ii) hematology and blood disorders. Two novel peptides derived from our proprietary discovery technology platform, icotrokinra (formerly known as JNJ-2113) and rusfertide, are currently in advanced Phase 3 clinical development, with New Drug Application (“NDA”) submissions to the U.S. Food and Drug Administration (“FDA”) potentially in 2025.

Icotrokinra is a first-in-class investigational targeted oral peptide that selectively blocks the Interleukin-23 receptor (“IL-23R”) and is licensed to J&J Innovative Medicines (“JNJ”), formerly Janssen Biotech, Inc., a Johnson & Johnson company. Following icotrokinra’s joint discovery by us and JNJ scientists pursuant to our IL-23R collaboration, we were primarily responsible for the development of icotrokinra through Phase 1, with JNJ assuming responsibility for development in Phase 2 and beyond. Rusfertide, a first-in-class investigational injectable mimetic of the natural hormone hepcidin, is in Phase 3 development for treatment of the rare blood disorder polycythemia vera (“PV”). Rusfertide is being co-developed and will be co-commercialized with Takeda Pharmaceuticals, Inc. (“Takeda”), with the Company remaining primarily responsible for clinical development activities through a potential NDA filing.

We also have a number of pre-clinical stage oral drug discovery programs addressing biologically and commercially validated targets, including our IL-17 oral peptide antagonist PN-881, an oral hepcidin program, and an oral anti-obesity program.

### Our Product Pipeline

### Icotrokinra

Our IL-23R antagonist compound icotrokinra, licensed to JNJ, is an orally delivered drug that is designed to block biological pathways currently targeted by marketed injectable antibody drugs. Our orally stable peptide approach may offer a targeted therapeutic approach for gastrointestinal and systemic compartments as needed. We believe that, compared to antibody drugs, icotrokinra has the potential to provide clinical improvement in an oral medication with increased convenience and compliance and the opportunity for the earlier introduction of targeted oral therapy.

JNJ has initiated the following icotrokinra trials:

- ICONIC-LEAD (NCT06095115) – A 684-patient randomized, controlled Phase 3 trial to evaluate the safety and efficacy of icotrokinra compared with placebo in participants with moderate-to-severe plaque psoriasis, with PASI-90 (90% improvement in skin lesions as measured by the Psoriasis Area and Severity Index (“PASI”)) and Investigator’s Global Assessment (“IGA”) score of 0 (clear) or 1 (almost clear) as co-primary endpoints;
- ICONIC-TOTAL (NCT06095102) – A 311-patient randomized, controlled Phase 3 trial to evaluate the efficacy and safety of icotrokinra compared with placebo for the treatment of plaque psoriasis in participants with at least moderate severity affecting special areas (scalp, genital, and/or palms of the hands and soles of the feet) with overall IGA score of 0 or 1 as the primary endpoint;
- ICONIC-ADVANCE 1 (NCT06143878) – A 774-patient randomized, controlled Phase 3 trial to evaluate the effectiveness of icotrokinra in participants with moderate-to-severe plaque psoriasis compared to placebo and Sotyktu® (“deucravacitinib”). The trial’s primary co-endpoints are PASI-90 and IGA score of 0 or 1;
- ICONIC-ADVANCE 2 (NCT06220604) – A 731-patient Phase 3 trial similarly designed to ICONIC ADVANCE 1 in participants with moderate-to-severe plaque psoriasis;
- Pustular/Erythrodermic Psoriasis (NCT06295692) – A 19-patient open label Phase 3 trial to evaluate the effectiveness of icotrokinra in participants with pustular or erythrodermic psoriasis;
- ICONIC-PsA1 (NCT06807424) – A 540-patient randomized, controlled Phase 3 trial to evaluate the efficacy and safety of icotrokinra compared with placebo in biologic-naive patients with active psoriatic arthritis;
- ICONIC-PsA2 (NCT06807424) – A 750-patient randomized, controlled Phase 3 trial to evaluate the efficacy and safety of icotrokinra compared with placebo in biologic-experienced patients with active psoriatic arthritis; and
- ANTHEM-UC (NCT06049017) – A 252-patient Phase 2b randomized, controlled trial to evaluate the safety and effectiveness of icotrokinra compared with placebo in participants with moderate-to-severely active ulcerative colitis (“UC”).

#### ICONIC Program

Data from the Phase 3 ICONIC-LEAD trial presented at the 2025 American Academy of Dermatology Annual Meeting in March 2025 showed that once daily icotrokinra demonstrated significant skin clearance and a favorable safety profile in adults and adolescents 12 years of age and older with moderate-to-severe plaque psoriasis.

Key findings from the ICONIC-LEAD trial are summarized below:

- At Week 24, nearly half of patients treated with icotrokinra achieved completely clear skin; 46% reached IGA 0 and 40% reached PASI 100 (100% improvement in skin lesions as measured by PASI).
- Nearly two-thirds (65%) of patients treated with once daily icotrokinra achieved an IGA score of 0 or 1 (clear or almost clear skin) and 50% achieved a PASI 90 response, compared to 8% and 4% receiving placebo, respectively (P\<0.001 for both endpoints), at Week 16.
- Continued skin clearance improvement was reported at Week 24, with 74% of patients treated with icotrokinra achieving IGA 0/1 and 65% achieving PASI 90.
- Similar proportions of patients experienced adverse events between icotrokinra (49%) and placebo groups (49%), with no new safety signals identified.

Additionally, topline results from the icotrokinra versus deucravacitinib Phase 3 ICONIC-ADVANCE 1 and ICONIC-ADVANCE 2 trials are summarized below:

- The trials met their co-primary endpoints of IGA 0/1 and PASI 90 versus placebo at Week 16.
- The trials also met all key secondary endpoints at Weeks 16 and 24 that measured superiority to deucravacitinib in patients with moderate-to-severe plaque psoriasis.

Based on the positive outcomes of the ICONIC ADVANCE-1 and ADVANCE-2 trials, JNJ is initiating the Phase 3 ICONIC-ASCEND trial, the first-ever head-to-head study seeking to demonstrate the superiority of icotrokinra, an oral pill, compared to ustekinumab, an injectable biologic.

In April 2025, results from a subgroup analysis of the ICONIC-LEAD trial evaluating icotrokinra in the adolescent population presented at the 2025 World Congress of Pediatric Dermatology showed adolescents treated with once daily icotrokinra achieved higher rates of clear or almost clear skin at Week 16 compared to patients receiving placebo, with no new safety signals identified.

#### ANTHEM-UC

In March 2025, we announced positive topline results from the Phase 2b Anthem-UC trial of icotrokinra in adults with moderately-to-severely active UC. The trial, conducted by JNJ, met its primary endpoint of clinical response in all icotrokinra dose groups evaluated. Additionally, the trial demonstrated clinically meaningful differences versus placebo in key secondary endpoints of clinical remission, symptomatic remission and endoscopic improvement at Week 12.

Key findings from the ANTHEM-UC trial are summarized below:

- All three doses of once daily icotrokinra met the primary endpoint of clinical response at Week 12.
- A response rate of 63.5% for patients treated with the highest dose of icotrokinra was achieved at Week 12 versus 27.0% for placebo (p\<0.001).
- 30.2% of patients treated with the highest dose of icotrokinra demonstrated clinical remission at Week 12 versus 11.1% of patients who received placebo (p\<0.001).
- Clinical remission and response rates continued to improve through Week 28.

Icotrokinra was well tolerated with the proportions of participants reporting one or more adverse events being similar between the icotrokinra dose groups and the placebo group. Comprehensive results from the ANTHEM-UC trial are being prepared for presentation at upcoming medical congresses by JNJ. Additional clinical studies of icotrokinra in UC and Crohn’s disease are planned.

#### JNJ License and Collaboration Agreement

In July 2021, we entered into an Amended and Restated License and Collaboration Agreement with JNJ, which amended and restated the License and Collaboration Agreement, effective July 2017, by and between the Company and JNJ, as amended in May 2019 (together, the “JNJ License and Collaboration Agreement”) for the development and commercialization of icotrokinra. The JNJ License and Collaboration Agreement was further amended in November 2024 to:

- increase the milestone payment for a Phase 3 clinical trial of any licensed product for any indication meeting its primary endpoint by $50.0 million from $115.0 million to $165.0 million;
- eliminate the $35.0 million milestone payment previously due for the acceptance of an NDA filing by the FDA for a licensed product for any indication; and
- eliminate the $15.0 million milestone payment previously due for the dosing of the third patient in the first Phase 3 clinical trial of a licensed product for a second indication.

We earned the $165.0 million milestone payment described above during the fourth quarter of 2024. We have earned a total of $337.5 million in non-refundable payments from JNJ from inception in 2017 through March 31, 2025. We are eligible to receive up to $630.0 million in future development and sales milestone payments, inclusive of the following potential upcoming milestones:

Upcoming potential milestones under the JNJ License and Collaboration Agreement include:

- $50.0 million upon approval of an NDA for icotrokinra in any indication;
- $25.0 million upon acceptance of an NDA for icotrokinra in a second indication;
- $45.0 million upon approval of an NDA for icotrokinra in a second indication;
- $35.0 million upon acceptance of an NDA for icotrokinra in a third indication; and
- $50.0 million upon approval of an NDA for icotrokinra in a third indication.

We also remain eligible to receive upward tiering royalties on net product sales at percentages ranging from 6% to 10% with 10% applicable for net sales over $4.0 billion. See Note 3 to the condensed consolidated financial statements included elsewhere in this Quarterly Report for additional information.

### PN-881

In the fourth quarter of 2024, we announced the selection of PN-881, a potential best-in-class oral peptide IL-17 antagonist, as a development candidate for the treatment of immune-mediated skin diseases. PN-881 targets three IL-17 dimers (IL-17 AA, AF and FF), which may offer potential treatment options for plaque psoriasis, psoriatic arthritis, hidradenitis suppurativa and spondyloarthritis. Investigational New Drug (“IND”), or foreign equivalent, enabling studies are ongoing, and we expect to initiate a PN-881 Phase 1 study in the fourth quarter of 2025.

### Rusfertide

Rusfertide is currently in Phase 3 development for the treatment of PV. VERIFY (ClinicalTrials.gov identifier NCT05210790) is a global double-blind, placebo-controlled Phase 3 clinical trial of rusfertide in PV with 293 patients enrolled. The trial evaluates the efficacy, symptom burden and safety of once-weekly, subcutaneously self-administered rusfertide in patients with uncontrolled hematocrit who are phlebotomy dependent despite standard of care treatment. The trial enrolled patients across North and South America, Europe, Asia and Australia. In March 2025, we announced positive top-line data for the trial’s 32-week primary efficacy endpoint, potentially leading to an NDA filing in the fourth quarter of 2025.

Key findings from the VERIFY trial are summarized below:

- The primary endpoint of the study was met, with a significantly higher proportion of clinical responders among rusfertide-treated patients with PV (77%) compared to those who received the placebo (33%) during weeks 20-32; p\<0.0001. The primary endpoint of the study was the proportion of patients achieving a response, which was defined as the absence of phlebotomy eligibility.
- The first key secondary endpoint, which is the pre-specified primary endpoint for European Union regulators, was also met, with a mean of 0.5 phlebotomies per patient in the rusfertide arm compared to 1.8 phlebotomies per patient in the placebo arm during weeks 0-32; p\<0.0001.
- The other three pre-specified key secondary endpoints, namely hematocrit control and patient-reported outcomes using PROMIS Fatigue SF-8a, a questionnaire that measures patient-reported fatigue symptoms and their impact on daily life, and Myeloproliferative Neoplasm-Symptom Assessment Form TSS-7, were also achieved with statistical significance.
- Rusfertide was generally well tolerated in the Phase 3 VERIFY trial, and safety was in line with previous rusfertide clinical studies. No new safety findings were observed in the study. The majority of adverse events were grade 1-2 injection site reactions, and all serious adverse events reported were deemed to be not drug related. There was no evidence of an increased risk of cancer in rusfertide-treated patients compared to those on the placebo.

THRIVE (NCT06033586), our Phase 2 long-term open-label extension (“OLE”) trial for REVIVE Phase 2 trial patients on years three through five of treatment, remains ongoing.

An abstract titled “Results From VERIFY, a Phase 3, Double-Blind, Placebo (PBO)-Controlled Study of Rusfertide for Treatment of Polycythemia Vera” was accepted for presentation at the Plenary Session at the American Society of Clinical Oncology Annual Meeting in June 2025.

#### Takeda Collaboration Agreement

In January 2024, we entered into a worldwide license and collaboration agreement for rusfertide with Takeda (the “Takeda Collaboration Agreement”). In March 2025, we and Takeda agreed, pursuant to the provisions of the Takeda Collaboration Agreement, as amended, that Takeda will assume responsibility for leading and implementing the regulatory strategy and associated activities for the preparation of an NDA related to rusfertide in PV, which is expected to be submitted to the FDA. We are primarily responsible for the clinical development of rusfertide through a potential NDA filing. Under the terms of the agreement, we received a one-time, non-refundable upfront payment of $300.0 million in April 2024, and the achievement of a $25.0 million milestone was deemed probable in March 2025 following positive topline results from the Phase 3 VERIFY trial of rusfertide in PV. We are eligible to receive additional worldwide development, regulatory and commercial milestone payments for rusfertide of up to $305.0 million.

Upcoming potential milestones under the Takeda Collaboration Agreement include:

- $50.0 million upon FDA approval of an NDA for rusfertide in PV (or $75.0 million if we exercise our Full Opt-out Right);
- $15.0 million upon first regulatory approval for rusfertide in PV in three European countries, after pricing and reimbursement approval; and
- $10.0 million upon first regulatory approval for rusfertide in PV in Japan.

We are also eligible to receive tiered royalties from 10% to 17% on ex-U.S. net sales of rusfertide and other specified second-generation injectable hepcidin memetic compounds (the “Licensed Products”). We and Takeda also share equally in profits and losses (50% to us and 50% to Takeda of the Licensed Products in the United States) if approved.

If we exercise our right to opt-out of the profit and loss sharing arrangement, we will receive royalties of 14% to 29% on annual worldwide net sales. In addition, we will be eligible for up to an aggregate of $975.0 million in development, regulatory and commercial milestone payments, and $400.0 million in payments for exercising the opt-out right.

See Note 3 to the condensed consolidated financial statements included elsewhere in this Quarterly Report for further details related to the agreement, including our opt-out right.

### Discovery Platform

Our clinical and pre-clinical assets are all derived from our proprietary discovery platform. Our platform enables us to engineer novel, structurally constrained peptides that are designed to retain key advantages of both orally delivered small molecules and injectable antibody drugs while overcoming many of their limitations as therapeutic agents. Importantly, constrained peptides can be designed to potentially alleviate the fundamental instability inherent in traditional peptides to allow different delivery forms, such as oral, subcutaneous, intravenous, and rectal. Our discovery pipeline has strategically focused on (i) I&I diseases, (ii) hematology and blood disorders and (iii) metabolic diseases, including obesity.

We have a pre-clinical stage program to identify an orally administered hepcidin mimetic or ferroportin inhibitor, which we believe to be complementary to the injectable rusfertide for offering the best treatment options for PV and other potential erythropoietic and iron imbalance disorders, and we expect to nominate a development candidate in the fourth quarter of 2025. We also have an oral peptide-based anti-obesity program focused on validated targets and including mono- and poly-incretin and non-incretin agonists and we expect to nominate a development candidate by the end of the second quarter of 2025.

### Risks and Uncertainties

We describe the respective risks, uncertainties and assumptions that could affect our business, financial condition or results of operations in Part II, Item 1A. “Risk Factors” herein.

### Operations

We have incurred cumulative net losses from inception through March 31, 2025 of $352.2 million. Substantially all of our net losses have resulted from costs incurred in connection with our research and development programs and from general and administrative costs associated with our operations. We expect to continue to incur significant research and development expenses, and other expenses related to our ongoing operations, product development, pre-clinical discovery programs and pre-commercialization activities. As a result, we may incur losses in the future as we continue the development of, and seek regulatory approval for, our product candidates.

### Critical Accounting Polices and Estimates

Our management’s discussion and analysis of our financial condition and results of operations is based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The preparation of these unaudited condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the unaudited condensed consolidated financial statements, as well as the reported revenue generated and expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, and the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

There have been no material changes to our critical accounting policies during the three months ended March 31, 2025, as compared to those disclosed in “*Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates”* in our Annual Report for the year ended December 31, 2024 filed with the SEC on February 21, 2025.

### Components of Our Results of Operations

### License and Collaboration Revenue

Our license and collaboration revenue is derived from payments we receive under our license and collaboration agreements with JNJ and Takeda. See Note 3 to the condensed consolidated financial statements included elsewhere in this Quarterly Report for additional information.

### Research and Development Expenses

Research and development expenses represent costs incurred to conduct research, such as the discovery and development of our product candidates. We recognize all research and development costs as they are incurred unless there is an alternative future use in other research and development projects or otherwise. Non-refundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity has been performed or when the goods have been received rather than when payment has been made. In instances where we enter into agreements with third parties to provide research and development services to us, costs are expensed as services are performed. Amounts due under such arrangements may be either fixed fee or fee for service and may include upfront payments, monthly payments, and payments upon the completion of milestones or the receipt of deliverables.

Research and development expenses consist primarily of the following:

- expenses incurred under agreements with clinical trial sites that conduct research and development activities on our behalf;
- employee-related expenses, which include salaries, benefits and stock-based compensation;
- laboratory vendor expenses related to the preparation and conduct of pre-clinical studies and clinical trials;
- costs related to production of clinical supplies and pre-clinical materials, including fees paid to contract manufacturers;
- license fees and milestone payments under license and collaboration agreements; and
- facilities and other allocated expenses, which include expenses for rent and maintenance of facilities, information technology, depreciation and amortization expense and administrative and other supplies.

We recognize the amounts related to our Australian research and development refundable tax offset that are not subject to refund provisions as a reduction in research and development expenses. The research and development tax offsets are recognized when there is reasonable assurance that the offset will be received, the relevant expenditure has been incurred, and the amount of the consideration can be reliably measured. We evaluate our eligibility under the tax offset program as of each balance sheet date and make accruals and related adjustments based on the most current and relevant data available. We may alternatively be eligible for a nonrefundable tax offset.

We allocate direct costs and indirect costs incurred to product candidates when they enter clinical development. For product candidates in clinical development, direct costs consist primarily of clinical, pre-clinical, and drug discovery costs, costs of supplying drug substance and drug product for use in clinical and pre-clinical studies, including clinical manufacturing costs, contract research organization fees, and other contracted services pertaining to specific clinical and pre-clinical studies. Indirect costs allocated to our product candidates on a program-specific basis include research and development employee salaries, benefits, and stock-based compensation, and indirect overhead and other administrative support costs. Program-specific costs are unallocated when the related expenses are incurred for our early-stage research and drug discovery projects as our internal resources, employees and infrastructure are not tied to any one research or drug discovery project and are typically deployed across multiple projects. As such, we do not provide financial information regarding the costs incurred for early-stage pre-clinical and drug discovery programs on a program-specific basis prior to the clinical development stage.

We expect our research and development expenses to increase in the near term as compared to the prior year period as we continue to focus our resources toward (i) preparing for regulatory filings and commercialization for our rusfertide program and (ii) advancing our pre-clinical and drug discovery research programs, including progressing our recently nominated product development candidate PN-881 through IND-enabling studies, or foreign equivalents. The process of conducting research, identifying potential product candidates, conducting pre-clinical studies and clinical trials necessary to obtain regulatory approval and commencing pre-commercialization activities is costly and time intensive. We may never succeed in achieving marketing approval for our product candidates regardless of our costs and efforts. The probability of success of our product candidates may be affected by numerous factors, including pre-clinical data, clinical data, competition, manufacturing capability, our cost of goods to be sold, our ability to receive, and the timing of, regulatory approvals, market conditions, and our ability to successfully commercialize our products if they are approved for marketing. As a result, we are unable to determine the duration and completion costs of our research and development projects or when and to what extent we will be able to generate revenue from the commercialization and sale of any of our product candidates. Our research and development programs are subject to change from time to time as we evaluate our priorities and available resources.

### General and Administrative Expenses

General and administrative expenses consist of personnel costs, allocated costs and other expenses for outside professional services, including legal, human resources, audit and accounting services, and pre-commercialization expenses, including selling and marketing costs. Personnel costs consist of salaries, benefits and stock-based compensation. Allocated costs consist of expenses for rent and maintenance of facilities, information technology, depreciation and amortization expense and other administrative supplies. We expect to continue to incur expenses to support our continued operations as a public company, including expenses related to compliance with the rules and regulations of the SEC and those of the national securities exchange on which our securities are traded, insurance expenses, investor relations expenses, audit fees, professional services and general overhead and administrative costs.

### Interest Income

Interest income consists of interest earned on our cash, cash equivalents and marketable securities, which is comprised of contractual interest, premium amortization and discount accretion.

### Other Income (Expense), Net

Other income (expense), net consists primarily of amounts related to foreign exchange gains and losses, realized gains and losses on sale of marketable securities and related items.

### Results of Operations

### Comparison of the Three Months Ended March 31, 2025 and 2024

*(Dollars in thousands)*

| ​ ​ ​ ​ ​ Revenue: | ​ ​ ​ ​ ​ | ​ ​ Three Months Ended March 31, 2025 ​ ​ | ​ ​ | ​ ​ 2024 ​ ​ | ​ ​ ​ ​ | ​ ​ ​ ​ Dollar Change ​ ​ | ​ ​ ​% ​ ​ | ​ ​ Change ​ ​ |
| --- | --- | ---: | --- | --- | --- | ---: | --- | ---: |
| License and collaboration revenue | ​ | $28,321 | ​ | $254,953 | ​ | $(226,632) | ​ | (89) |
| Operating expenses: |  | ​ |  | ​ |  | ​ |  |  |
| Research and development (1) | ​ | ​ 35,893 | ​ | ​ 33,734 | ​ | ​ 2,159 |  | 6 |
| General and administrative (2) | ​ | 11,738 | ​ | 14,910 | ​ | (3,172) |  | (21) |
| Total operating expenses | ​ | 47,631 | ​ | 48,644 | ​ | (1,013) |  | (2) |
| (Loss) income from operations | ​ | (19,310) | ​ | 206,309 | ​ | (225,619) |  | (109) |
| Interest income | ​ | 7,573 | ​ | ​ 4,376 | ​ | 3,197 |  | 73 |
| Other income (expense), net | ​ | ​ 82 | ​ | ​ (19) | ​ | ​ 101 | ​ | \* |
| (Loss) income before income tax expense | ​ | ​ (11,655) | ​ | ​ 210,666 | ​ | ​ (222,321) | ​ | (106) |
| Income tax expense | ​ | ​ — | ​ | ​ 3,326 | ​ | ​ (3,326) | ​ | (100) |
| Net (loss) income | ​ | $(11,655) | ​ | $207,340 | ​ | $(218,995) |  | (106) |

\*Percentage not meaningful.

(1) Includes $8.0 million and $5.3 million of non-cash stock-based compensation expense for the three months ended March 31, 2025 and 2024, respectively.

(2) Includes $5.8 million and $4.1 million of non-cash stock-based compensation expense for the three months ended March 31, 2025 and 2024, respectively.

#### License and Collaboration Revenue

License and collaboration revenue for the three months ended March 31, 2025 of $28.3 million related to the Takeda Collaboration Agreement was comprised of i) $22.8 million related to the proportional recognition of the $25.0 million milestone deemed probable of being achieved due to the Phase 3 VERIFY trial of rusfertide in PV meeting its primary endpoint and (ii) $5.5 million related to the initial transaction price for development services provided by us during the period. Revenue recognition for the $25.0 million milestone, which is payable upon completion of the VERIFY clinical study report, was allocated based on the allocation of the initial standalone selling price of each performance obligation under the agreement. The remaining $2.2 million in revenue related to the $25.0 million milestone will be recognized through the conclusion of the development services performance obligation.

License and collaboration revenue for the three months ended March 31, 2024 of $255.0 million included $254.1 million of the $300.0 million upfront cash payment allocated to the delivery of the rusfertide license to Takeda upon effectiveness of the Takeda Collaboration Agreement in March 2024, and $0.9 million allocated to development services provided by us during the period based on the cost input method. The remaining $45.0 million was recorded as deferred revenue to be recognized over time as we satisfy our performance obligation to complete the ongoing Phase 3 VERIFY trial for rusfertide.

We do not have any commercialized products, and our revenue is derived from licensing and collaboration agreements. Revenue from licensing and collaboration agreements, by its very nature, is highly variable and dependent upon factors such as the timing of when regulatory and sales milestones are achieved, if at all, and the accounting for any upfront payments and performance obligations associated with any existing or new agreements.

Our revenue for the year ended December 31, 2024 was significantly higher than in prior years due to the partial recognition of an upfront payment of $300.0 million upon execution of the Takeda Collaboration Agreement and the achievement of a $165.0 million milestone pursuant to the terms of the amended JNJ License and Collaboration Agreement. Our revenue for the year ended December 31, 2025 is expected to be comprised of (i) the proportionate recognition of the $30.6 million recorded in deferred revenue as of December 31, 2024, and (ii) any milestones achieved during the year, which are expected to be substantially lower than in 2024. Accordingly, revenue in 2025 is expected to reduce significantly, which will also impact our net income.

#### Research and Development Expenses

*(Dollars in thousands)*

| ​ ​ ​ ​ ​ | ​ ​ ​ ​ | ​ ​ Three Months Ended March 31, 2025 | ​ ​ | ​ ​ 2024 | ​ ​ ​ ​ | ​ ​ ​ ​ Dollar Change | ​ ​ ​% ​ ​ | ​ ​ Change ​ |
| --- | --- | ---: | --- | ---: | --- | ---: | --- | ---: |
| Clinical and development expense — rusfertide | ​ | $21,400 | ​ | $24,513 | ​ | $(3,113) | ​ | (13) |
| Clinical and development expense — other | ​ | ​ 116 | ​ | ​ 150 | ​ | ​ (34) | ​ | (23) |
| Pre-clinical and drug discovery research expense | ​ | ​ 14,377 | ​ | ​ 9,071 | ​ | ​ 5,306 | ​ | 58 |
| Total research and development expenses | ​ | $35,893 | ​ | $33,734 | ​ | $2,159 | ​ | 6 |

Research and development expenses increased $2.2 million, or 6%, from $33.7 million for the three months ended March 31, 2024 to $35.9 million for the three months ended March 31, 2025. The increase was primarily due to an increase of $5.3 million in pre-clinical and drug discovery research program expenses, including costs related to PN-881, our recently nominated IL-17 development candidate, partially offset by a decrease of $3.1 million in rusfertide expenses related to our Phase 3 VERIFY clinical trial.

We had 97 full-time equivalent research and development employees for both the three months ended March 31, 2025 and 2024. Research and development personnel-related expenses for the three months ended March 31, 2025 increased by $2.2 million as compared to the three months ended March 31, 2024, primarily driven by an increase in stock-based compensation expense related to annual refresher awards granted in January 2025 and recognition of expense related to performance stock units (“PSUs”).

#### General and Administrative Expenses

General and administrative expenses decreased $3.2 million, or 21%, from $14.9 million for the three months ended March 31, 2024 to $11.7 million for the three months ended March 31, 2025. This decrease was primarily due to a $4.6 million decrease in one-time advisory and legal fees incurred in the three months ended March 31, 2024 related to the Takeda Collaboration Agreement, partially offset by a $1.7 million increase in stock-based compensation expense related to annual refresher awards granted in January 2025 and recognition of PSU expense.

We had 27 full-time equivalent general and administrative employees for both the three months ended March 31, 2025 and 2024.

#### Interest Income

Interest income increased by $3.2 million, or 73%, from $4.4 million for the three months ended March 31, 2024 to $7.6 million for the three months ended March 31, 2025. This increase was primarily due to higher invested balances, including milestone payments received from our collaboration partners.

#### Income Tax Expense

Income tax expense was zero and $3.3 million for the three months ended March 31, 2025 and 2024, respectively. Income tax expense for the three months ended March 31, 2024 was a result of taxable income from the recognition of revenue in connection with the Takeda Collaboration Agreement. The effective tax rate was 1.54% for the three months ended March 31, 2024.

### Liquidity and Capital Resources

### Sources of Liquidity

We had $697.9 million and $559.2 million in cash, cash equivalents and marketable securities as of March 31, 2025 and December 31, 2024, respectively. Historically, we have funded our operations primarily from net proceeds from the sale of shares of our common stock and the receipt of payments under collaboration agreements.

#### Receipt of Payments Under Collaboration Agreements

The JNJ License and Collaboration Agreement was amended in November 2024 to:

- increase the milestone payment for a Phase 3 clinical trial of any licensed product for any indication meeting its primary endpoint by $50.0 million, from $115.0 million to $165.0 million;
- eliminate the $35.0 million milestone payment previously due for the acceptance of an NDA filing by the FDA for use of licensed product for any indication; and
- eliminate the $15.0 million milestone payment previously due for the dosing of the third patient in the first Phase 3 clinical trial of a licensed product for a second indication.

We earned the $165.0 million milestone payment described above during the fourth quarter of 2024, which we received in January 2025. We have received a total of $337.5 million in non-refundable payments from JNJ from the inception of the JNJ License and Collaboration Agreement in 2017 through March 31, 2025. We have also received payments for services provided under the collaboration agreement, and we have made in-kind payment reimbursements to JNJ for certain costs they have incurred pursuant to the cost sharing terms of the agreement. Pursuant to the JNJ License and Collaboration Agreement, we may be eligible to receive clinical development, regulatory and sales milestones, if and when achieved.

Upcoming potential milestones under the JNJ License and Collaboration Agreement include:

- $50.0 million upon approval of an NDA for icotrokinra in any indication;
- $25.0 million upon acceptance of an NDA for icotrokinra in a second indication;
- $45.0 million upon approval of an NDA for icotrokinra in a second indication;
- $35.0 million upon acceptance of an NDA for icotrokinra in a third indication; and
- $50.0 million upon approval of an NDA for icotrokinra in a third indication.

In March 2024, we earned a $300.0 million one-time, non-refundable upfront payment from Takeda upon the closing of the Takeda Collaboration Agreement, which we received in April 2024. In March 2025, the achievement of a $25.0 million milestone was deemed probable based upon positive topline results for the Phase 3 VERIFY trial for rusfertide in PV. This milestone is payable upon the completion of the VERIFY clinical study report. Pursuant to the Takeda Collaboration Agreement, we may be eligible to receive additional clinical development, regulatory and sales milestones, if and when achieved.

Upcoming potential milestones under the Takeda Collaboration Agreement include:

- $50.0 million upon FDA approval of an NDA for rusfertide in PV (or $75.0 million if we exercise our Full Opt-out Right);
- $15.0 million upon first regulatory approval for rusfertide in PV in three European countries, after pricing and reimbursement approval; and
- $10.0 million upon first regulatory approval for rusfertide in PV in Japan.

### Capital Requirements

As of March 31, 2025, we had $697.9 million in cash, cash equivalents and marketable securities and an accumulated deficit of $352.2 million. Our capital expenditures were $0.5 million and $1.4 million for the three months ended March 31, 2025 and the year ended December 31, 2024, respectively. Our primary uses of cash are to fund our operating expenses, including our research and development expenditures and general and administrative costs. We expect that our existing cash, cash equivalents and marketable securities will be sufficient to fund our operations for at least the next twelve months from the date of this Quarterly Report based on current operating plans and financial forecasts.

We may require additional funding to advance our early discovery pipeline and to develop, acquire, or in-license other potential product candidates. Our future funding requirements will depend on many factors, including:

- the progress, timing, scope, results and costs of advancing our clinical trials for our product candidates, including the ability to enroll patients in a timely manner for our clinical trials;
- the costs of and our ability to obtain clinical supplies for our current product candidates and any other product candidates we may identify and develop;
- our ability to successfully commercialize our current product candidates with our collaboration partners and any other product candidates we may identify and develop;
- the success of our existing or future collaborations with third parties;
- the selling and marketing costs associated with rusfertide, which is being co-developed and co-commercialized with Takeda under the Takeda Collaboration Agreement, and any other product candidates we may identify and develop, including the costs and timing of expanding our sales and marketing capabilities;
- the achievement of development, regulatory and sales milestones resulting in payments to us from JNJ under the JNJ License and Collaboration Agreement, Takeda under the Takeda Collaboration Agreement, or other such arrangements that we may enter into, and the timing of receipt of such payments, if any;
- the timing, receipt and amount of royalties from JNJ under the JNJ License and Collaboration Agreement or Takeda under the Takeda Collaboration Agreement upon regulatory approval or clearance, if any;
- the amount and timing of sales and other revenues from our current product candidates and any other product candidates we may identify and develop, including the sales price and the availability of adequate third-party reimbursement;
- the cash requirements of any future acquisitions or discoveries of product candidates;
- the time and costs necessary to respond to technological and market developments; and
- the extent to which we may acquire or in-license other product candidates and technologies.

Such additional funding may come from various sources, including raising additional capital, seeking access to debt, and seeking additional collaborative or other arrangements with partners, but such funding may not be available on terms acceptable to us, if at all. We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by domestic and global monetary and fiscal policy, changes in trade policies, including tariffs or other restrictions or the threat of such actions, geopolitical instability, inflationary pressures and high interest rates and banking and other financial institution instability, among other factors. A future recession or market correction, including those due to significant geopolitical or macroeconomic events, could materially affect our business and our access to credit and financial markets.

Any failure to raise capital as and when needed could have a negative impact on our financial condition and on our ability to pursue our business plans and strategies. Further, our operating plans may change, and we may need additional funds to meet operational needs and capital requirements for clinical trials, other research and development activities and pre-commercialization costs. If we do raise additional capital through public or private equity offerings or convertible debt securities, the ownership interest of our existing stockholders could be diluted, and the terms of these securities could include liquidation or other preferences that could adversely affect our stockholders’ rights. If we raise additional capital through debt financing, we could be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. Because of the numerous risks and uncertainties associated with the development and commercialization of our product candidates, we are unable to fully estimate the amounts of increased capital outlays and operating expenditures associated with our current and anticipated product development programs.

### Cash Flows

The following table summarizes our cash flows for the periods indicated:

*(Dollars in thousands)*

| ​ ​ ​ ​ Condensed Consolidated Statements of Cash Flows Data: | ​ ​ ​ ​ | ​ ​ Three Months Ended March 31, 2025 | ​ | ​ ​ 2024 |
| --- | --- | ---: | --- | ---: |
| Cash provided by (used in) operating activities | ​ | $125,363 | ​ | $(27,429) |
| Cash (used in) provided by investing activities | ​ | $(94,402) | ​ | $6,071 |
| Cash provided by financing activities | ​ | $11,443 | ​ | $7,199 |
| Stock-based compensation | ​ | $13,802 | ​ | $9,352 |
| Deferred revenue | ​ | $(5,496) | ​ | $45,047 |

#### Cash Provided by (Used in) Operating Activities

Cash provided by operating activities for the three months ended March 31, 2025 was $125.4 million and consisted primarily of a net change of $124.7 million in operating assets and liabilities and $13.8 million of stock-based compensation expense, partially offset by a net loss of $11.7 million during the period. The change in net operating assets and liabilities was driven primarily by a $165.0 million milestone payment received under the JNJ License and Collaboration Agreement in January 2025, partially offset by the recognition of a $22.8 million contract asset related to the Takeda Collaboration Agreement, a $5.5 million change in deferred revenue and a $11.8 million change in accrued expenses and other payables. The $152.8 million increase in cash provided by operating activities during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024, was primarily due to the receipt of a $165.0 million milestone payment from JNJ in January 2025.

#### Cash (Used in) Provided by Investing Activities

Cash used in investing activities for the three months ended March 31, 2025 was $94.4 million and consisted primarily of purchases of marketable securities of $214.0 million and purchases of property and equipment of $0.5 million, partially offset by proceeds from maturities and sales of marketable securities of $120.2 million. The $100.5 million increase in cash used in investing activities for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024, was primarily related to investments made with a portion of the proceeds from the $165.0 million milestone payment received from JNJ in January 2025. Purchases of property and equipment were primarily related to laboratory equipment and furniture and fixtures.

#### Cash Provided by Financing Activities

Cash provided by financing activities for the three months ended March 31, 2025 was $11.4 million and consisted of net cash proceeds of $11.9 million from the issuance of common stock upon exercises of stock options and purchases of stock under our employee stock purchase plan (“ESPP”), partially offset by $0.5 million in tax withholding payments related to the net settlement of restricted stock units. The $4.2 million increase in cash provided by financing activities for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024, was primarily due to a $4.1 million increase in proceeds from the issuance of common stock upon exercise of options and purchases of common stock under the ESPP.

### Contractual Obligations and Other Commitments

During the three months ended March 31, 2025, there were no material changes to our material cash requirements, including commitments for capital expenditures, described under *Management’s Discussion and Analysis of Financial Condition and Results of Operations* in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on February 21, 2025.

## Market risk

As filed, 2,033 characters.

We are exposed to market risks in the ordinary course of our business. These risks primarily include interest rate sensitivities related to our interest-earning investments and inflation risk affecting labor costs and clinical trial costs.

### Interest Rate Fluctuation Risk

We had $697.9 million and $559.2 million in cash, cash equivalents and marketable securities at March 31, 2025 and December 31, 2024, respectively. Our cash and cash equivalents consist of cash, money market funds, commercial paper and government bonds. Marketable securities consist of certificates of deposit, corporate bonds, commercial paper and government bonds. A portion of our investments may be subject to interest rate risk and could decline in value if market interest rates increase. Based on our interest rate sensitivity analysis, an immediate 100 basis point increase in interest rates would increase our annual interest income by approximately $3.4 million, while an immediate 100 basis point decrease in interest rates would decrease our annual interest income by approximately $3.4 million.

Approximately $1.3 million and $0.6 million of our cash balance was located in Australia at March 31, 2025 and December 31, 2024, respectively. Our expenses, except those related to our Australian operations, are generally denominated in U.S. dollars. For our operations in Australia, the majority of our expenses are denominated in Australian dollars. To date, we have not had a formal hedging program with respect to foreign currency, but we may do so in the future if our exposure to foreign currency becomes more significant. A 10% increase or decrease in current exchange rates would not have a material effect on the results of our operations.

### Inflation Fluctuation Risk

Inflation generally affects us by increasing our costs, such as the cost of labor and research and development contract costs. We do not believe inflation has had a material adverse effect on the results of our operations during the three months ended March 31, 2025.

## Controls and procedures

As filed, 1,729 characters.

### Evaluation of Disclosure Controls and Procedures

Management, under the supervision and with the participation of our Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer), has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on the evaluation of our disclosure controls and procedures, our Chief

Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective at the reasonable assurance level.

### Limitations on Effectiveness of Controls and Procedures and Internal Control over Financial Reporting

In designing and evaluating the disclosure controls and procedures and internal control over financial reporting, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures and internal control over financial reporting must reflect the fact that there are resource constraints, and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

### Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting that occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

## Risk factors

As filed, 7,767 characters.

Our business, results of operations and financial conditions are subject to various risks. These risks are described elsewhere in this Quarterly Report on Form 10-Q and in our other filings with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2024. Other than the risk factors disclosed in this Item 1A below, there have been no material changes from the risk factors identified in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

***Disruptions at the FDA and other government agencies could negatively affect the review of our regulatory submissions, which could negatively impact our business.***

The ability of the FDA to review and approve regulatory submissions can be affected by a variety of factors, including statutory, regulatory and policy changes, inadequate government budget funding levels or a reduction in the FDA’s workforce and its ability to hire and retain key personnel, disruptions caused by government shutdowns, public health crises, the FDA’s ability to accept the payment of user fees, and other events that may otherwise affect the FDA’s ability to perform routine functions. There have been mass layoffs of federal employees since the start of the current presidential administration in January 2025, the full impact of which is unclear at this time. Such disruptions could significantly impact the ability of the FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business. In addition, the presidential administration has made and is expected to continue to make changes in the leadership of various U.S. federal regulatory agencies and changes to U.S. federal government policy that have led to, in some cases, legal challenges and uncertainty around the funding, functioning and policy priorities of the U.S. federal regulatory agencies, including the FDA.

We are unable to predict the extent to which the presidential administration may impose or seek to impose leadership or policy changes at the FDA or changes to rules and policies impacting our business and operations. It is unclear how these executive actions or other potential actions by the federal government will impact the FDA or other regulatory authorities that oversee our business. Government proposals to reduce or eliminate budgetary deficits may include reduced allocations to the FDA and other related government agencies. These budgetary pressures may reduce the FDA’s ability to perform its responsibilities, which could result in delays in our clinical trial timelines. If a significant reduction in the FDA’s workforce occurs, the FDA’s budget is significantly reduced or a prolonged government shutdown occurs, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions or take other actions critical to the development or approval of our product candidates, which could have a material adverse effect on our business.

***Unstable market and macroeconomic conditions, including elevated and sustained inflation and changes in tariffs or trade policy, may have serious adverse consequences on our business, financial condition and stock price.***

As has been widely reported, we are currently operating in a period of macroeconomic uncertainty and capital markets disruption, which has been significantly impacted by domestic and global monetary and fiscal policy, trade regulations, including changes in trade policies, tariffs or other trade restrictions or the threat of such actions, geopolitical instability, including ongoing military conflicts between Russia and Ukraine and in the Middle East, rising tensions between China and Taiwan, and high interest rates. In particular, the conflict in Ukraine has exacerbated market disruptions, including significant volatility in commodity prices, as well as supply chain interruptions, and has contributed to record inflation globally. The U.S. Federal Reserve and other central banks may be unable to contain inflation through more restrictive monetary policy and inflation may increase or continue for a prolonged period of time. Inflationary factors, such as increases in the cost of clinical supplies, interest rates, overhead costs and transportation costs may adversely affect our operating results. We continue to monitor these events and the potential impact on our business. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, our financial position or results of operations may be adversely affected in the future due to the macroeconomic factors discussed above, and such factors may lead to increases in the cost of manufacturing our product candidates and delays in initiating trials. In addition, global credit and financial markets have experienced extreme volatility and disruptions in the past several years and the foregoing factors have led to and may continue to cause diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, uncertainty about economic stability and increased inflation.

Adverse macroeconomic conditions, including inflation, slower growth or recession, new or increased tariffs and other barriers to trade, especially in light of recent comments and executive orders made by the presidential administration, changes to fiscal and monetary policy or government budget dynamics (particularly in the pharmaceutical and biotech areas), tighter credit, higher interest rates, volatility in financial markets, high unemployment, labor availability constraints, currency fluctuations and other challenges in the global economy have in the past adversely affected, and may in the future adversely affect, us and our business partners and suppliers. In recent months, the United States has announced tariffs on imports from most countries, including significant tariffs on imports from Canada, Mexico and China. Historically, tariffs have led to increased trade and political tensions. In response to tariffs, other countries have implemented retaliatory tariffs on U.S. goods. Political tensions as a result of trade policies could reduce trade volume, investment, technological exchange and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets. There is substantial uncertainty about the duration of existing tariffs and whether additional tariffs may be imposed, modified or suspended.

There can be no assurance that further deterioration in credit and financial markets and confidence in economic conditions will not occur. A future recession or market correction or other significant geopolitical events could materially affect our business and the value of our common stock. Our general business strategy may be adversely affected by any such economic downturn, volatile business environment or continued unpredictable and unstable market conditions. If the current equity and credit markets deteriorate, or do not improve, it may make any necessary debt or equity financing more difficult, more costly, and more dilutive. Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance and stock price and could require us to delay or abandon clinical development plans. In addition, there is a risk that one or more of our current service providers, manufacturers and other partners may not survive these difficult economic times, which could directly affect our ability to attain our operating goals.

Filed May 6, 2025.
Source: SEC EDGAR, the filing index for accession 0001558370-25-006530. Last ingested by Listed: Nov 6, 2026, 12:26 ET. No prices; not investment advice.