MBX Biosciences, Inc.

NATURE OF BUSINESS AND Liquidity

MBX Biosciences, Inc. (“MBX” or the “Company”) is a clinical-stage biopharmaceutical company focused on the discovery and development of novel precision peptide therapies for the treatment of endocrine and metabolic disorders. The Company is advancing a pipeline of novel candidates for endocrine and metabolic disorders. The Company was organized in August 2018 in Indiana as a Limited Liability Company and converted to a C corporation in the state of Delaware in April 2019. The Company maintains its corporate offices in Carmel, Indiana.

Since inception, the Company has devoted substantially all of its resources to drug discovery and development of its product candidates canvuparatide (MBX 2109), MBX 1416 and MBX 4291, and other preclinical programs, building an intellectual property portfolio, organizing and staffing the Company, business planning, raising capital and providing general and administrative support for these operations. The Company does not have any products approved for sale and has not generated any revenue from product sales. The Company has historically funded its operations primarily through the issuance and sale of our common stock, including through our initial public offering (the "IPO"), convertible preferred stock and convertible notes, which generated approximately $401.8 million in aggregate gross proceeds.

Liquidity

From inception and through March 31, 2025, the Company has devoted substantially all of its efforts to drug discovery and development. The Company has a limited operating history, has incurred operating losses since inception and expects to continue to incur significant operating losses for the foreseeable future. The Company incurred net losses of $23.9 million and $32.6 million for thethree months ended March 31, 2025 and the year ended December 31, 2024, respectively. As of March 31, 2025, the Company has an accumulated deficit of $161.4 million and cash, cash equivalents and marketable securities of$240.8 million. Based on the Company’s current business plan, management believes that existing cash and cash equivalents and marketable securities will be sufficient to fund the Company’s obligations for at least 12 months from the date of issuance of these condensed financial statements.

Basis of presentation

The accompanying unaudited condensed financial statements as of March 31, 2025 and for the three months ended March 31, 2025 and 2024 have been prepared in accordance with U.S. generally accepted accounting principle ("U.S. GAAP") for interim financial information and pursuant to Article 10 of Regulation of the Securities Act of 1933, as amended. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. These unaudited condensed financial statements include only normal and recurring adjustments that the Company believes are necessary to fairly state the Company’s financial position and the results of its operations and cash flows. The results for the three months ended March 31, 2025 are not necessarily indicative of the results expected for the full fiscal year or any subsequent interim period. The condensed balance sheet at December 31, 2024 has been derived from the audited financial statements at that date but does not include all disclosures required by U.S. GAAP for complete financial statements. Because all of the disclosures required by U.S. GAAP for complete financial statements are not included herein, these unaudited condensed financial statements and the notes accompanying them should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2024 included in the Company's Annual Report on Form 10-K as filed with the SEC on March 17, 2025.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

There have been no significant changes from the significant accounting policies and estimates disclosed in Note 2 of the "Notes to Financial Statements" in the audited financial statements for the year ended December 31, 2024 and notes thereto, included in the Annual Report on Form 10-K as filed with the SEC on March 17, 2025.

Recently issued accounting pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard-setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the accompanying financial statements and disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes: Improvements to Income Tax Disclosures (Topic 740), which establishes incremental disaggregation of income tax disclosures pertaining to the effective tax rate reconciliation and income taxes paid. This new standard is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The standard should be applied prospectively to financial statements issued for periods after the effective date of this ASU with the option to apply it retrospectively. The Company intends to adopt this standard in its Annual Report on Form 10-K for the year ending December 31, 2025 and is currently assessing the impact ASU 2023-09 (Topic 740) will have on its financial statements, including the footnote disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which is intended to provide more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation and amortization) included in certain expense captions presented on the face of our consolidated income statements. This new standard is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments may be applied either (1) prospectively to financial statements issued for periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the consolidated financial statements. The Company is currently assessing the impact ASU 2024-03 will have on its financial statements, including the footnote disclosures.

FAIR VALUE Measurements

The following table presents information about the Company’s financial instruments as of March 31, 2025 and December 31, 2024, that are measured at fair value on a recurring basis and indicates the fair value hierarchy of the inputs the Company utilized to determine such fair value (in thousands):

Marketable Securities

The fair value of the Company’s marketable securities as of March 31, 2025 and December 31, 2024 is based on Level 1 and Level 2 inputs. The Company’s investments consist mainly of U.S. government and agency securities. Fair value is determined by taking into consideration valuations obtained from third-party pricing services. The third-party pricing services utilize industry standard valuation models, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities; issuer credit spreads; benchmark securities; and other observable inputs. There were no transfers between levels within the fair value hierarchy during each of the three months ended March 31, 2025 and 2024. The Company has assessed U.S. government treasuries as Level 1 and all other marketable securities as Level 2 within the fair value hierarchy of ASC 820. The Company classifies its entire investment portfolio as available-for-sale as defined in ASC 320, Debt Securities, and views all investments as available for use in its current operations. The Company has therefore classified all securities as current, even if it does not necessarily intend to dispose of the securities in the following year. Securities are carried at fair value with the unrealized (losses) gains reported in other comprehensive (loss) income.

As of March 31, 2025 and December 31, 2024, none of the Company’s investments were determined to be other than temporarily impaired.

The following table summarizes the Company’s investments (in thousands):

The fair values of available-for-sale debt securities as of March 31, 2025, by contractual maturity, are summarized as follows (in thousands):

PREPAID EXPENSES and Other Current assets

Prepaid and other current assets consisted of the following (in thousands):

PROPERTY AND EQUIPMENT, NET

Property and equipment, net consisted of the following(in thousands):

Depreciation expense was $0.1 million and an immaterial amount for thethree months ended March 31, 2025 and 2024, respectively.

ACCRUED Expenses

Accrued expenses consisted of the following (in thousands):

Other Assets

Other assets consisted of the following (in thousands):

Commitments and contingencies

Leases

In April 2022, the Company entered into an operating lease agreement for a principal executive office in Carmel, Indiana (the “Carmel Lease”). The Carmel Lease commenced in October 2022 and has an initial term of 39 months, terminating in December 2025, with anoption toextend for 36 additional months at the Company’s discretion. The option to extend is not considered reasonably certain as of the lease inception.

In December 2023, the Company entered into an operating lease agreement for laboratory space in Indianapolis, Indiana (the “Laboratory Lease”). The Laboratory Lease commenced in December 2023 and had a term of 12 months, terminating in December 2024. The Company entered into a new lease for laboratory space in August 2024, commencing in December 2024, and terminating in December 2025. Both laboratory leases are short-term leases with no corresponding lease liability or right-of-use asset recorded, and lease payments are recognized as expense on a straight-line basis over the lease terms.

The Company has no other operating or finance leases as of March 31, 2025 or December 31, 2024.

The future minimum rent payments relating to the Carmel Lease under the terms and conditions existing as of March 31, 2025, are summarized as follows (in thousands):

The Company incurred $0.1 million of rent expense for each of thethree months ended March 31, 2025 and 2024, respectively.

The following table summarizes the operating lease term and discount rate for the Carmel Lease as of March 31, 2025 and December 31, 2024:

Cash paid for amounts included in the measurement of the Company’s operating lease liability was less than $0.1 million for each of thethree months ended March 31, 2025 and 2024, respectively.

The following table sets forth the amount of right-of-use assets and lease liabilities included on the Company’s balance sheet as of March 31, 2025 and December 31, 2024 (in thousands):

License agreement

In January 2024, the Company entered into an amendment (the "Amendment") for the Exclusive License Agreement with Indiana University Research and Technology Corporation (“IURTC”) (the “License Agreement”), to license certain intellectual property arising under the Master Research Agreement with The Trustees of Indiana University (the "Research Agreement"). The Amendment specifies IURTC is entitled to the receipt of additional clinical and regulatory milestones, as defined in the Amendment, up to an aggregate of $9.0 million. Following the execution of the Amendment, future remaining clinical and regulatory milestone payments in the License Agreement and all amendments total up to $9.3 million. In consideration for the license, the Company paidno license fees to IURTC during thethree months ended March 31, 2025 and 2024.

Legal proceedings

The Company is not currently a party to any material legal proceedings. At each reporting date, the Company evaluates whether a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. The Company expenses as incurred the costs related to its legal proceedings.

Convertible preferred stock

The Company issued Series A Convertible Preferred Stock, Series B Convertible Preferred Stock and Series C Convertible Preferred Stock.

On August 30, 2024, the Company's board of directors (the "Board") and stockholders approved the fourth amended and restated certificate of incorporation, which was effective immediately prior to the closing of the Company's IPO on September 16, 2024, and which, among other things, authorized 10,000,000 undesignated shares of preferred stock, $0.0001 par value per share.

Immediately prior to the closing of the Company's IPO on September 16, 2024, pursuant to the reverse stock split and a proportional adjustment to the existing conversion ratios of each series of the Company's preferred stock, all of the Company's outstanding shares of convertible preferred stock were converted into an aggregate of 20,336,599 shares of common stock, as follows:4,458,324 shares of common stock were issued as a result of the conversion of Series A convertible preferred stock;10,750,183 shares of common stock were issued as a result of the conversion of Series B convertible preferred stock; and 5,128,092 shares of common stock were issued as a result of the conversion of Series C convertible preferred stock. Prior to the conversion of the Company's convertible preferred stock, holders of the Series A, Series B and Series C Convertible Preferred Stock had certain rights and preferences, including voting and conversion rights and dividend and liquidation preferences. The Company hadno shares of convertible preferred stock outstanding at March 31, 2025.

Common stock

On August 30, 2024, the Company’s stockholders approved the fourth amended and restated certificate of incorporation, which was filed upon the closing of the IPO on September 16, 2024 and which, among other things, increased the number of shares of common stock authorized for issuance to 500,000,000 shares of common stock, $0.0001 par value.

On September 16, 2024, the Company completed the IPO of its common stock and issued and sold 11,730,000 shares of its common stock at a price of $16.00 per share. As a result, the Company received $170.5 million in net proceeds, after deducting underwriting discounts and commissions and offering costs of $17.2 million.

As of March 31, 2025 and December 31, 2024, there were 33,424,371 and 33,421,525 shares of common stock issued and outstanding, respectively. Shares of common stock issued and outstanding as of March 31, 2025, include 8,145 shares of restricted stock related to the unvested portion of early exercised common stock options. Shares of common stock issued and outstanding as of December 31, 2024 include 12,608 shares of restricted stock related to the unvested portion of early exercised common stock options. These are included in shares of common stock as they are considered to be legally outstanding as of March 31, 2025 and December 31, 2024, respectively. These shares are subject to the Company’s option to repurchase and are not transferrable until such time as they are fully vested.

Common stock reserved

The number of shares of common stock that have been reserved for future issuance in connection with outstanding stock options granted under the Company's 2019 Stock Option and Grant Plan (the "2019 Plan") and the 2024 Stock Option and Incentive Plan (the "2024 Plan"), stock options available for grant under the 2019 Plan and 2024 Plan and shares available for future issuance under th 2024 ESPP as of March 31, 2025 and December 31, 2024, are as follows:

Stock-Based Compensation

2019 Stock Option and Grant Plan

The Company’s 2019 Plan, as amended, provides for the Company to sell or issue common stock or restricted common stock or to grant incentive stock options or nonqualified stock options for the purchase of common stock, to employees, members of the Board, and consultants of the Company. The 2019 Plan is administered by the Board or at the discretion of the Board by a committee of the Board. The exercise prices, vesting periods, and other restrictions are determined at the discretion of the Board or a committee of the Board, except that the exercise price per share of stock options may not be less than 100% of the fair market value of the share of common stock on the date of grant and the contractual term of stock option may not be greater than 10 years. Stock options granted to date typically vest and become exercisable over four years from the date of grant.

As of the date the 2024 Plan became effective, there will be no further awards granted under the 2019 Plan, but all outstanding awards under the 2019 Plan will continue to be governed by their existing terms.2,875,990 stock options to purchase common stock were outstanding under the 2019 Plan as of March 31, 2025.

2024 Stock Option and Incentive Plan

In August 2024, the Company's board of directors adopted, and its stockholders approved, the 2024 Plan, which became effective in September 2024. The 2024 Plan allows the Company to make equity-based and cash-based incentive awards to its officers, employees, directors and consultants. The 2024 Plan provides for the grant of incentive stock options, stock options, stock appreciation rights, restricted shares of common stock, restricted stock units, dividend equivalent rights and cash bonuses. The number of shares initially reserved for issuance under the 2024 Plan is 3,065,000 shares. In addition, the number of shares reserved and available for issuance under the 2024 Plan will automatically increase on January 1, 2025 and each January 1 thereafter, byfive percent (5%) of the sum of the outstanding number of shares of common stock and the numbers of shares of common stock issuable pursuant to the exercise of any outstanding warrants to acquire common stock for a nominal exercise price on the immediately preceding December 31 or such lesser number of shares as determined by the compensation committee. The number of shares reserved under the 2024 Plan is subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization. As of March 31, 2025,1,421,420 stock options to purchase common stock were outstanding under the 2024 Plan, and 3,476,513 shares remained available for future grant under the 2024 Plan. The shares available for issuance under the 2024 Plan may be authorized but unissued shares or shares reacquired by the Company.

The shares of common stock underlying any awards under the 2024 Plan and the 2019 Plan that are forfeited, cancelled, held back upon exercise or settlement of an award to satisfy the exercise price or tax withholding, reacquired by the Company prior to vesting, satisfied without the issuance of stock, expire or are otherwise terminated (other than by exercise) will be added back to the shares of common stock available for issuance under the 2024 Plan.

2024 Employee Stock Purchase Plan

In August 2024, the Company's board of directors adopted, and its stockholders approved, the 2024, which became effective in September 2024. A total of 289,436 shares of common stock were initially reserved for issuance under the 2024 ESPP. The 2024 ESPP provides that the number of shares reserved and available for issuance will automatically increase on January 1, 2025 and each January 1 thereafter, by the least of (i)578,872 shares of common stock, (ii)one percent (1%) of the number of shares of common stock issued and outstanding on the immediately preceding December 31, or (iii) such lesser number of shares of common stock as determined by the administrator of the 2024 ESPP. The number of shares reserved under the 2024 ESPP is subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization. As of March 31, 2025,623,651 shares remained available for issuance under the 2024 ESPP. No shares were issued under the 2024 ESPP during thethree months ended March 31, 2025.

Stock option valuation

The determination of the grant date fair value of stock-based awards granted to employees, directors and nonemployees during thethree months ended March 31, 2025 and 2024, was estimated using the Black-Scholes option-pricing model and was calculated based on the following assumptions.

Summary of option activity

The Company’s stock option activity regarding employees, directors, and nonemployees for thethree months ended March 31, 2025, is summarized as follows (in thousands except share and per share amounts):

Additional information with regard to stock option activity involving employees and directors for the three months ended March 31, 2025 and 2024, is as follows (in thousands except per share amounts):

As of March 31, 2025, total unrecognized compensation cost related to the unvested awards to employees, directors, and nonemployees is $23.2 million, which is expected to be recognized over a weighted-average period of 3.1 years.

Stock-based compensation

During thethree months ended March 31, 2025 and 2024, the Company recorded stock-based compensation expense regarding its employees, directors, and nonemployees as follows (in thousands):

defined contribution plan

The Company established a defined contribution savings plan under Section 401(k) of the Internal Revenue Code. This plan covers substantially all employees who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pretax basis. In the three months ended March 31, 2025, the Company began contributing to the plan on behalf of its employees, and as of March 31, 2025, the Company made contributions of $0.1 million to the plan. No employer contributions were made during the year ended December 31, 2024.

Net loss per share attributable to common stockholders

Net loss per share

The following table summarizes the computation of basic and diluted net loss per share attributable to common stockholders of the Company (in thousands except share and per share amounts).

The Company’s potential dilutive securities, which include convertible preferred stock, restricted stock related to early exercise of common stock options, restricted stock related to unvested founder shares and outstanding common stock options, have been excluded from the computation of diluted net loss per share as the effect would be antidilutive. Therefore, the weighted average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to common stockholders is the same. The potential dilutive securities included in the table below, presented on an as converted basis, were excluded from the calculation of net loss per share due to their anti-dilutive effect:

Related Party transactions

In April 2019, the Company executed the Research Agreement pursuant to which the Company agreed to fund certain research of a former director and former officer of the Company. The period of performance for this agreement is June 1, 2019 through April 30, 2022 and the contract totals approximately $2.8 million. On February 14, 2022, the Research Agreement was amended to extend the period of performance from April 30, 2022 to April 30, 2025 and increase the total contract costs by $3.0 million. On January 16, 2025, the Research Agreement was amended to extend the period of performance from April 30, 2025 through April 1, 2026 and increase the total contract costs by $1.0 million. The Company paid$0.3 million pursuant to this agreement during each of the three months ended March 31, 2025 and 2024. The Research Agreement also provides the Company an option to license the technology arising under the agreement (see Note 9).

16. SEGMENT INFORMATION

The Company operates as asingle reportable segment engaged in the discovery and development of novel precision peptide therapies for the treatment of endocrine and metabolic disorders. The Company's determination that it operates as asingle segment is consistent with the nature of its operations and the financial information regularly reviewed by the chief executive officer, in his capacity as the chief operating decision maker(CODM), for the purposes of evaluating performance, allocating resources, setting incentive compensation targets, and planning and forecasting for future periods. The Company's purpose is to help people with endocrine and metabolic disorders live fuller and healthier lives. The Company's long-term success is significantly dependent on its ability to research and develop innovative medicines. The CODM uses net loss to assess performance of the Company, ensuring that it is investing in the research and development of product candidates. The CODM allocates research and development resources based upon several factors, including the likelihood of technical success, unmet medical needs, and the viability of commercial success. A significant component of the CODM’s decision-making process is to ensure a balanced investment in the research and development portfolio to drive near-term success and long-term sustainability.

The following table summarizes our significant segment expenses and segment net loss for thethree months ended March 31, 2025 and 2024 (in thousands):

(1) Other segment items are primarily comprised of general and administrative expenses and interest and other income.

17. Subsequent events

The Company has concluded no subsequent events have occurred that require disclosure, except as noted below:

Carmel Lease

On May 9, 2025, the Company entered into the first amendment of the Carmel Lease (the "First Amendment") related to the Company'sprincipal executive office. Pursuant to the terms of the First Amendment, the leased premises were expanded, and the lease term was extended through December 31, 2028 with anoption toextend for 36 additional months at the Company’s discretion. The Company is currently assessing the impact the amendment will have on its financial statements, including related footnote disclosures.