Galecto, Inc.

Previous wording

Based on current estimates of our expenses going forward, we believe that our existing cash and cash equivalents will be sufficient to fund the preclinical development of GB3226 into 2026, including the submission of an investigational new drug application (“IND”) to the FDA. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. We will require substantial additional capital to finance our operations, including clinical development of any of the GB3226 and GB1211 programs identified herein. If we are unable to secure adequate additional funding, we will need to reevaluate our operating plans and may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, delay, scale back or eliminate some or all of our development programs, relinquish rights to our intellectual property on less favorable terms than we would otherwise choose, or cease operations entirely.

Current wording

Based on current estimates of our expenses going forward, we believe that our existing cash and cash equivalents will be sufficient to fund the preclinical development of GB3226 into 2026, including the submission of an investigational new drug application (“IND”) to the U.S. Food and Drug Administration (the “FDA”). We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. We will require substantial additional capital to finance our operations, including clinical development of any of the GB3226 and GB1211 programs identified herein. If we are unable to secure adequate additional funding, we will need to reevaluate our operating plans and may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, delay, scale back or eliminate some or all of our development programs, relinquish rights to our intellectual property on less favorable terms than we would otherwise choose, or cease operations entirely.

Previous wording

We believe that GB3226 is well-positioned to address the menin-resistant population within AML. Acute leukemias driven by rearrangement of the mixed lineage leukemia 1 gene or mutation of NPM1 require the chromatin adapter protein menin, encoded by the MEN1 gene, to sustain aberrant leukemogenic gene expression programs. Somatic mutations in MEN1 have been identified in patients with acquired resistance to menin inhibition. Consistent with the genetic data in patients, inhibitor-menin interface mutations represent a conserved mechanism of therapeutic resistance in xenograft models and in an unbiased base-editor screen. These mutants attenuate drug-target binding by generating structural perturbations that impact small-molecule binding but not the interaction with the natural ligand MLL1, and prevent inhibitor-induced eviction of menin and MLL1 from chromatin. Inhibition of ENL and the subsequent decrease of target gene expression occurs independent of presence of menin and is not negatively impacted by MEN1 mutations.

Current wording

We believe that GB3226 is well-positioned to address the menin-resistant population within AML. Acute leukemias driven by rearrangement of KMT2A or mutation of NPM1 require the chromatin adapter protein menin, encoded by the MEN1 gene, to sustain aberrant leukemogenic gene expression programs. Somatic mutations in MEN1 have been identified in patients with acquired resistance to menin inhibition. Consistent with the genetic data in patients, inhibitor-menin interface mutations represent a conserved mechanism of therapeutic resistance in xenograft models and in an unbiased base-editor screen. These mutants attenuate drug-target binding by generating structural perturbations that impact small-molecule binding but not the interaction with the natural ligand MLL1, and prevent inhibitor-induced eviction of menin and MLL1 from chromatin. Inhibition of ENL and the subsequent decrease of target gene expression occurs independent of presence of menin and is not negatively impacted by MEN1 mutations, which suggests that this therapeutic resistance could potentially be addressed by GB3226.

Previous wording

Bridge Medicines, prior to our acquisition of GB3226, conducted a number of preclinicalin vitroand in vivo studies of GB3226 that suggest it is a potent and selective inhibitor of cell proliferation in MLLr cell lines, with durable anti-tumor activity. GB3226 has shown dose-dependent effects on key genetic drivers of leukemogenesis and maintenance, including HOXA9 and MEIS1, indicating suppression of leukemic stem cell development in the bone marrow. Reductions of blasts cells in peripheral blood, bone marrow, and spleen have been demonstrated in animal models, in addition to cell cycle arrest, differentiation of blasts, and apoptosis. Preclinical studies have shown that GB3226 is active against several molecular drivers of AML, including MLL-r, NPM1m, cKIT+, FLT3+ and TET2+. In vitro modeling of GB3226 in combination with AML standard of care therapies and menin inhibitors in several relevant cell lines showed synergistic or additive effects. GB3226 has demonstrated promising tolerability in rat and dog toxicology studies performed to date at encouraging exposure multiples. As a result, we believe that GB3226’s unique dual-mechanism promotes rapid onset (FLT3 inhibition) and duration of response (ENL-YEATS inhibition).

Current wording

Bridge Medicines, prior to our acquisition of GB3226, conducted a number of preclinicalin vitroand in vivo studies of GB3226 that suggest it is a potent and selective inhibitor of cell proliferation in MLLr cell lines, with durable anti-tumor activity. GB3226 has shown dose-dependent effects on key genetic drivers of leukemogenesis and maintenance, including HOXA9 and MEIS1, indicating suppression of leukemic stem cell development in the bone marrow. Reductions of blasts cells in peripheral blood, bone marrow, and spleen have been demonstrated in animal models, in addition to cell cycle arrest, differentiation of blasts, and apoptosis. Preclinical studies have shown that GB3226 is active against several molecular drivers of AML, including MLL-r, NPM1m, cKIT+, FLT3+ and TET2+. In vitro modeling of GB3226 in combination with AML standard of care therapies and menin inhibitors in several relevant cell lines showed synergistic or additive effects. GB3226 has shown a promising tolerability profile at encouraging exposure multiples in rat and dog toxicology studies performed to date, and we plan to initiate additional IND-enabling toxicology studies in August 2025. We believe that this preclinical data demonstrates GB3226’s unique dual-mechanism that promotes rapid onset (FLT3 inhibition) and duration of response (ENL-YEATS inhibition).

Previous wording

We enrolled a total of 13 patients in Part A of the GALLANT-1 trial (100 mg: six; 200 mg: seven). Four patients in Part A of the GALLANT-1 trial (100 mg: three; 200 mg: one) showed a partial response according to Response Evaluation Criteria in Solid Tumors (“RECIST”), criteria (version 1.1). One patient receiving GB1211 at 200 mg twice daily, alongside atezolizumab (Tecentriq®) demonstrated a sustained partial response over the course of the trial. At the 12-week mark, tumor shrinkage exceeded 70%, and this reduction was maintained throughout subsequent study visits. In accordance with local treatment guidelines, this patient was discontinued from the trial after receiving checkpoint inhibitor therapy for two consecutive years. Additionally, three of the five patients treated for at least six weeks with 100 mg of GB1211 twice daily, combined with atezolizumab, showed a partial response. Currently, one patient continues to receive GB1211 in combination with atezolizumab in the extension phase of the trial and will continue to be followed until progression or unacceptable toxicity. This patient, who has been treated for over two years, demonstrated tumor shrinkage exceeding 80%, consistently recorded during all study visits between week 36 and week 108. Insights from biomarker analyses from the GALLANT-1 trial revealed a trend showing that responders had increased levels of galectin-3 at baseline, and stable or decreasing galectin-3 levels during treatment. In contrast, patients with progressive disease demonstrated increasing levels of galectin-3 during treatment. This correlation suggests that the detection of galectin-3 levels could potentially be used to select and monitor patient populations.

Current wording

We enrolled a total of 13 patients in Part A of the GALLANT-1 trial (100 mg: six; 200 mg: seven). Four patients in Part A of the GALLANT-1 trial (100 mg: three; 200 mg: one) showed a partial response according to Response Evaluation Criteria in Solid Tumors (“RECIST”), criteria (version 1.1). One patient receiving GB1211 at 200 mg twice daily, alongside atezolizumab (Tecentriq®) demonstrated a sustained partial response over the course of the trial. At the 12-week mark, tumor shrinkage exceeded 70%, and this reduction was maintained throughout subsequent study visits. In accordance with local treatment guidelines, this patient was discontinued from the trial after receiving checkpoint inhibitor therapy for two consecutive years. Additionally, three of the five patients treated for at least six weeks with 100 mg of GB1211 twice daily, combined with atezolizumab, showed a partial response. Currently, one patient continues to receive GB1211 in combination with atezolizumab in the extension phase of the trial and will continue to be followed until the earlier to occur of progression, unacceptable toxicity or the completion of the extension phase at the end of October 2025. This patient, who has been treated for over two years, demonstrated tumor shrinkage exceeding 80%, consistently recorded during all study visits between week 36 and week 126. Insights from biomarker analyses from the GALLANT-1 trial revealed a trend showing that responders had increased levels of galectin-3 at baseline, and stable or decreasing galectin-3 levels during treatment. In contrast, patients with progressive disease demonstrated increasing levels of galectin-3 during treatment. This correlation suggests that the detection of galectin-3 levels could potentially be used to select and monitor patient populations.

Previous wording

We will incur significant expenses relating to our development of GB3226 and GB1211. Our ability to generate revenue from product sales sufficient to achieve profitability will depend heavily on our advancement of these two assets, as well as partnering and/or funding additional activities in order to achieve the successful development and eventual commercialization of one or more of these product candidates. Our operations to date have been financed primarily from our initial public offering (“IPO”), the issuance of common stock through our Open Market Sale Agreement SMwith Jefferies LLC, as sales agent, to provide for the issuance and sale of up to $50.0 million of our common stock from time to time in “at-the-market” offerings under a registration statement on Form S-3 that the SEC declared effective on November 12, 2021 and related prospectus (the “ATM Program”), and the issuance of convertible preferred shares and convertible notes. Since inception, we have had significant operating losses. Our net loss was $2.5 million and $2.5 million for the three months ended March 31, 2025, respectively. Our net loss was $5.5 million and $5.5 million for the three months ended March 31, 2024, respectively. As of March 31, 2025, we had an accumulated deficit of $280.1 million and $11.9 million in cash and cash equivalents, respectively.

Current wording

We will incur significant expenses relating to our development of GB3226 and GB1211. Our ability to generate revenue from product sales sufficient to achieve profitability will depend heavily on our advancement of these two assets, as well as partnering and/or funding additional activities in order to achieve the successful development and eventual commercialization of one or more of these product candidates. Our operations to date have been financed primarily from our initial public offering (“IPO”), the issuance of common stock through our Open Market Sale Agreement SMwith Jefferies LLC, as sales agent, to provide for the issuance and sale of up to $50.0 million of our common stock from time to time in “at-the-market” offerings under a previously effective registration statement on Form S-3 and related prospectus (the “ATM Program”), and the issuance of convertible preferred shares and convertible notes. Since inception, we have had significant operating losses. Our net loss was $3.4 million and $6.0 million for the three and six months ended June 30, 2025, respectively. Our net loss was $5.3 million and $10.8 million for the three and six months ended June 30, 2024, respectively. As of June 30, 2025, we had an accumulated deficit of $283.5 million and $10.2 million in cash and cash equivalents.

Previous wording

Based on current estimates of our expenses going forward, we believe that our existing cash and cash equivalents of $11.9 million as of March 31, 2025 will be sufficient to fund the preclinical development of GB3226 into 2026, including the submission of an IND to the U.S. Food and Drug Administration (the “FDA”). However, we will require substantial additional capital to finance our operations, including clinical development of any of our GB3226 and GB1211 programs. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. We have evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern from the issuance date of our financial statements. We will require substantial additional capital to finance our operations, including clinical development of any of our GB3226 and GB1211 programs. These conditions raise substantial doubt about our ability to continue as a going concern for a period of at least one year from the date our financial statements are issued. We have developed plans to mitigate this risk, which primarily consist of raising additional capital through some combination of equity or convertible debt financings and/or potential new collaborations, but there can be no assurances any such financing will be available when needed, or on acceptable terms. If we are unable to secure adequate additional funding, we will need to reevaluate our operating plans and may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, delay, scale back or eliminate some or all of our development programs, relinquish rights to our intellectual property on less favorable terms than we would otherwise choose, or cease operations entirely. These actions could materially impact our business, results of operations and future prospects and the value of shares of our common stock, and investors may lose all or a part of their investment. In addition, attempting to secure additional financing may divert the time and attention of management from day-to-day activities and distract from our discovery and product development efforts.

Current wording

Based on current estimates of our expenses going forward, we believe that our existing cash and cash equivalents of $10.2 million as of June 30, 2025 will be sufficient to fund the preclinical development of GB3226 into 2026, including the submission of an IND to the FDA. However, we will require substantial additional capital to finance our operations, including clinical development of any of our GB3226 and GB1211 programs. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. We have evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern from the issuance date of our financial statements. We will require substantial additional capital to finance our operations, including clinical development of any of our GB3226 and GB1211 programs. These conditions raise substantial doubt about our ability to continue as a going concern for a period of at least one year from the date our financial statements are issued. We have developed plans to mitigate this risk, which primarily consist of raising additional capital through some combination of equity or convertible debt financings and/or potential new collaborations, but there can be no assurances any such financing will be available when needed, or on acceptable terms. If we are unable to secure adequate additional funding, we will need to reevaluate our operating plans and may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, delay, scale back, or eliminate some or all of our development programs, relinquish rights to our intellectual property on less favorable terms than we would otherwise choose, or cease operations entirely. These actions could materially impact our business, results of operations and future prospects, and the value of shares of our common stock, and investors may lose all or a part of their investment. In addition, attempting to secure additional financing may divert the time and attention of management from day-to-day activities and distract from our discovery and product development efforts.

Previous wording

To date, we have not had any products approved for sale and, therefore, have not generated any product revenue. We do not expect to generate any revenues from product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our product candidates. As a result, until such time, if ever, that we can generate substantial product revenue, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, including collaborations, licenses or similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed or on favorable terms, if at all. 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, including our research and development activities. If we are unable to raise capital, we will need to further delay, reduce or terminate activities to reduce costs beyond the restructurings implemented in September 2023 and May 2024.

Current wording

To date, we have not had any products approved for sale and, therefore, have not generated any product revenue. We do not expect to generate any revenues from product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our product candidates. As a result, until such time, if ever, that we can generate substantial product revenue, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, including collaborations, licenses, or similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed or on favorable terms, if at all. 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, including our research and development activities. If we are unable to raise capital, we will need to further delay, reduce, or terminate activities to reduce costs.

Previous wording

Economic uncertainty in various global markets, including the United States and Europe, caused by political instability and conflict, such as the ongoing conflict in Ukraine and in Israel, and recent developments in U.S. trade policy, including the imposition and expansion of tariffs, have led to market disruptions, including significant volatility in commodity prices, credit and capital market instability and supply chain interruptions, which caused record inflation globally. Our business, financial condition and results of operations could be materially and adversely affected by further negative impact on the global economy and capital markets resulting from these global economic conditions, particularly if such conditions are prolonged or worsen.

Current wording

Economic uncertainty in various global markets, including the United States and Europe, caused by political instability and conflict, such as the ongoing conflicts in Ukraine, Israel, and Iran, and recent developments in U.S. trade policy, including the imposition and expansion of tariffs, have led to market disruptions, including significant volatility in commodity prices, credit and capital market instability and supply chain interruptions, which caused record inflation globally. Our business, financial condition, and results of operations could be materially and adversely affected by further negative impact on the global economy and capital markets resulting from these global economic conditions, particularly if such conditions are prolonged or worsen.

Previous wording

Although, to date, our business has not been materially impacted by these global economic and geopolitical conditions, it is impossible to predict the extent to which our operations will be impacted in the short and long term, or the ways in which such instability could impact our business and results of operations. The extent and duration of these market disruptions, whether as a result of the military conflict between Russia and Ukraine and effects of the Russian sanctions, current armed conflict in Israel and the Gaza Strip, geopolitical tensions, volatile inflation rates, tariffs or otherwise, are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described in this report.

Current wording

Although, to date, our business has not been materially impacted by these global economic and geopolitical conditions, it is impossible to predict the extent to which our operations will be impacted in the short and long term, or the ways in which such instability could impact our business and results of operations. The extent and duration of these market disruptions, whether as a result of the military conflicts in Iran and between Russia and Ukraine and effects of the Russian sanctions, current armed conflict in Israel and the Gaza Strip, geopolitical tensions, volatile inflation rates, tariffs or otherwise, are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described in this report.

Previous wording

We have historically met the requirements to receive a tax credit in Denmark of up to $0.8 million per year for losses resulting from research and development costs of up to approximately $3.6 million per year. The tax credit is reported as a reduction to research and development expense in the condensed consolidated statements of operations. We recorded a tax credit of $0.1 and $0.6 million during the three month periods ended March 31, 2025 and 2024, respectively. The credits are available the following year, in 2026 and 2025, respectively.

Current wording

We have historically met the requirements to receive a tax credit in Denmark of up to $0.8 million per year for losses resulting from research and development costs of up to approximately $3.6 million per year. The tax credit is reported as a reduction to research and development expense in the condensed consolidated statements of operations. We recorded a tax credit of $0.4 and $0.8 million during the six months ended June 30, 2025 and 2024, respectively. The credits are available the following year, in 2026 and 2025, respectively.

Previous wording

We have qualified for the R&D Expenditure Credit (the “RDEC”) in United Kingdom for preclinical laboratory and in-patient clinical trials. The RDEC net tax benefit is reported as a reduction to research and development expense in the consolidated statements of operations. There was no RDEC recorded during the three months ended March 31, 2025. We recorded an overall reduction for the RDEC, net of the UK corporation tax rate of $0.04 million during the three months ended March 31, 2024.

Current wording

We have qualified for the R&D Expenditure Credit (the “RDEC”) in United Kingdom for preclinical laboratory and in-patient clinical trials. The RDEC net tax benefit is reported as a reduction to research and development expense in the consolidated statements of operations. There was no RDEC recorded during the six months ended June 30, 2025. We recorded an overall reduction for the RDEC, net of the UK corporation tax rate of $0.07 million during the six months ended June 30, 2024.

Previous wording

Our general and administrative expenses consist primarily of personnel costs, depreciation expense and other expenses for outside professional services, including legal, human resources, audit and accounting services and facility-related fees not otherwise included in research and development expenses. Personnel costs consist of salaries, benefits and stock-based compensation expense, for our personnel in executive, finance and accounting, business operations and other administrative functions. We expect our general and administrative expenses to increase moderately over the next several years to support our continued research and development activities, manufacturing activities and continued costs of operating as a public company. However, we anticipate these expenses will be lower than our general and administrative expenses prior to announcing the initiation of our strategic alternative review in September 2023. These expenses will likely include continued costs related to the hiring of additional personnel, legal, regulatory and other fees, director and officer insurance premiums and investor relations costs associated with our continued operations.

Current wording

Our general and administrative expenses consist primarily of personnel costs, depreciation expense, and other expenses for outside professional services, including legal, human resources, audit and accounting services, and facility-related fees not otherwise included in research and development expenses. Personnel costs consist of salaries, benefits, and stock-based compensation expense for our personnel in executive, finance, accounting, business operations, and other administrative functions. We expect our general and administrative expenses to increase moderately over the next several years to support our continued research and development activities, manufacturing activities, and continued costs of operating as a public company. However, we anticipate these expenses will remain lower than our general and administrative expenses prior to announcing the initiation of our strategic alternative review in September 2023. These expenses will likely include continued costs related to consultants and the hiring of additional personnel; legal, regulatory, and other fees; director and officer insurance premiums; and other costs associated with our continued operations.

Previous wording

Research and development expenses were $0.7 million for the three months ended March 31, 2025, compared to $2.5 million for the three months ended March 31, 2024. The decrease of $1.8 million was primarily related to decreased preclinical studies and clinical trial-related expenses of $0.3 million, decreased personnel costs of $1.2 million and decreased consulting and other research and development costs of $0.3 million.

Current wording

Research and development expenses were $1.5 million for the three months ended June 30, 2025, compared to $1.8 million for the three months ended June 30, 2024. The decrease of $0.3 million was primarily related to decreased preclinical studies and clinical trial-related expenses of $0.1 million, decreased personnel costs of $0.6 million, and decreased consulting and other research and development costs of $0.3 million, offset by increased chemistry, manufacturing, and control costs of $0.7 million.

Previous wording

General and administrative expenses were $1.9 million for the three months ended March 31, 2025, compared to $3.3 million for the three months ended March 31, 2024. The decrease of $1.4 million was primarily related to decreased personnel costs of $0.7 million, decreased legal related costs of $0.5 million and decreased other general administrative costs of $0.2 million.

Current wording

General and administrative expenses were $2.0 million for the three months ended June 30, 2025, compared to $2.8 million for the three months ended June 30, 2024. The decrease of $0.8 million was primarily related to decreased personnel costs of $0.3 million, decreased legal related costs of $0.3 million, and decreased other general administrative costs of $0.2 million.

Previous wording

Other income (expense), net for the three months ended March 31, 2025 was $0.1 million, compared to $0.3 million for the three months ended March 31, 2024. The decrease of $0.2 million was primarily due to decreased interest income, net resulting from lower investable balances.

Current wording

Other income (expense), net, for the three months ended June 30, 2025 was $(12,000), compared to $281,000 for the three months ended June 30, 2024. The decrease of $293,000 was primarily due to decreased interest income, net, resulting from lower investable balances and increased foreign exchange transaction loss, net.

Previous wording

Our operations to date have been financed primarily through our IPO, the issuance of common stock through our ATM Program, the issuance of convertible preferred shares and convertible notes. Since inception, we have had significant operating losses. On November 2, 2020, we completed our IPO in which we raised $86.3 million in net proceeds. During the three months ended March 31, 2025 and 2024, we had no sales under the ATM Program.

Current wording

Our operations to date have been financed primarily through our IPO, the issuance of common stock through our ATM Program, the issuance of convertible preferred shares and convertible notes. Since inception, we have had significant operating losses. On November 2, 2020, we completed our IPO in which we raised $86.3 million in net proceeds. During each of the three and six months ended June 30, 2025 and 2024, we had no sales under the ATM Program.

Previous wording

Our net losses were $2.5 million and $5.5 million for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, we had an accumulated deficit of $280.1 million and $11.9 million in cash and cash equivalents. Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in our outstanding accounts payable and accrued expenses.

Current wording

Our net losses were $3.4 million and $6.0 million for the three and six months ended June 30, 2025, respectively. Our net losses were $5.3 million and $10.8 million for the six months ended June 30, 2024, respectively. As of June 30, 2025, we had an accumulated deficit of $283.5 million and $10.2 million in cash and cash equivalents. Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in our outstanding accounts payable and accrued expenses.

Previous wording

Cash used in operating activities of $5.9 million during the three months ended March 31, 2024 was primarily attributable to our net loss of $5.5 million together with non-cash items of $1.4 million principally with respect to stock-based compensation and a net decrease of $1.8 million in components of our working capital.

Current wording

Cash used in operating activities of $4.7 million during the six months ended June 30, 2025 was primarily attributable to our net loss of $6.0 million together with non-cash items of $0.4 million principally with respect to stock-based compensation and a net increase of $0.9 million in components of our working capital.

Previous wording

Cash used in operating activities of $2.4 million during the three months ended March 31, 2025 was primarily attributable to our net loss of $2.5 million together with non-cash items of $0.2 million principally with respect to stock-based compensation and a net decrease of $0.1 million in components of our working capital.

Current wording

Cash used in operating activities of $10.0 million during the six months ended June 30, 2024 was primarily attributable to our net loss of $10.8 million together with non-cash items of $2.5 million principally with respect to stock-based compensation and a net decrease of $1.7 million in components of our working capital.

Previous wording

We had no investing activities during the three months ended March 31, 2025.

Current wording

We had no investing activities during the six months ended June 30, 2025.

Previous wording

Cash provided by investing activities of $5.7 million during the three months ended March 31, 2024 was the result of proceeds from the sale of marketable securities.

Current wording

Cash provided by investing activities of $11.7 million during the six months ended June 30, 2024 was the result of proceeds from the sale of marketable securities.

Previous wording

We had no financing activities during the three months ended March 31, 2025 and March 31, 2024.

Current wording

We had no financing activities during the six months ended June 30, 2025 and 2024.

Previous wording

Based on current estimates of our expenses going forward, we believe that our existing cash and cash equivalents of $11.9 million as of March 31, 2025 will be sufficient to fund our operating expenditures and capital expenditure requirements into 2026. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. These conditions raise substantial doubt about our ability to continue as a going concern for a period of at least one year from the date our financial statements are issued. We have developed plans to mitigate this risk, which primarily consist of raising additional capital through some combination of equity or convertible debt financings and/or potential new collaborations, but there can be no assurances any such financing will be available when needed, or on acceptable terms. If we are unable to secure adequate additional funding, we will need to reevaluate our operating plans and may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, delay, scale back or eliminate some or all of our development programs, relinquish rights to our intellectual property on less favorable terms than we would otherwise choose, or cease operations entirely. These actions could materially impact our business, results of operations and future prospects and the value of shares of our common stock, and investors may lose all or a part of their investment. In addition, attempting to secure additional financing may divert the time and attention of management from day-to-day activities and distract from our discovery and product development efforts.

Current wording

Based on current estimates of our expenses going forward, we believe that our existing cash and cash equivalents of $10.2 million as of June 30, 2025 will be sufficient to fund the preclinical development of GB3226 into 2026, including the submission of an IND to the FDA. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. These conditions raise substantial doubt about our ability to continue as a going concern for a period of at least one year from the date our financial statements are issued. We have developed plans to mitigate this risk, which primarily consist of raising additional capital through some combination of equity or convertible debt financings and/or potential new collaborations, but there can be no assurances any such financing will be available when needed, or on acceptable terms. If we are unable to secure adequate additional funding, we will need to reevaluate our operating plans and may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, delay, scale back or eliminate some or all of our development programs, relinquish rights to our intellectual property on less favorable terms than we would otherwise choose, or cease operations entirely. These actions could materially impact our business, results of operations and future prospects and the value of shares of our common stock, and investors may lose all or a part of their investment. In addition, attempting to secure additional financing may divert the time and attention of management from day-to-day activities and distract from our discovery and product development efforts. If our available cash resources are insufficient to fund our expenses and the development of our product candidates and/or completion of a transaction identified above, we may implement further cost reduction and other cash-focused measures to manage liquidity, and we may pursue a plan of liquidation or dissolution or seek bankruptcy protection. If we decide to cease operations and dissolve and liquidate our assets, it is unclear to what extent we would be able to pay our obligations. In such a circumstance and in light of our current liquidity position, it is unlikely that cash would be available for distribution to stockholders.

Previous wording

Any product candidates we may develop may never achieve commercialization and we anticipate that we will continue to incur losses for the foreseeable future. Until such time, if ever, as we can generate substantial product revenue, we expect to finance our future operations through our existing cash and cash equivalents and through a combination of equity offerings, debt financings, collaborations, strategic alliances, marketing and distribution arrangements, and/or licensing arrangements. We do not currently have any committed external source of funds. To the extent that we raise additional capital through the sale of equity or convertible debt securities, our stockholders’ ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect our stockholders’ rights as a common stockholder. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making acquisitions or capital expenditures or declaring dividends. If we raise additional funds through collaborations, strategic alliances, marketing and distribution arrangements, or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or other arrangements when needed, we may be required to delay, limit, reduce or terminate our research, product development or future commercialization efforts, or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Current wording

Any product candidates we may develop may never achieve commercialization and we anticipate that we will continue to incur losses for the foreseeable future. Until such time, if ever, as we can generate substantial product revenue, we expect to finance our future operations through our existing cash and cash equivalents and through a combination of equity offerings, debt financings, collaborations, strategic alliances, marketing and distribution arrangements, and/or licensing arrangements. We do not currently have any committed external source of funds. To the extent that we raise additional capital through the sale of equity or convertible debt securities, our stockholders’ ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect our stockholders’ rights as a common stockholder. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making acquisitions or capital expenditures, or declaring dividends. If we raise additional funds through collaborations, strategic alliances, marketing and distribution arrangements, or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates, or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or other arrangements on acceptable terms when needed, we may be required to delay, limit, reduce or terminate our research, product development or future commercialization efforts, or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Previous wording

We estimate these costs based on factors such as estimates of the work completed and budget provided and in accordance with agreements established with our collaboration partners and third-party service providers. We make estimates in determining the accrued liabilities and prepaid expense balances in each reporting period. As actual costs become known, we adjust our accrued liabilities or prepaid expenses. We have not experienced any material differences between accrued costs and actual costs incurred since our inception.

Current wording

We estimate these costs based on factors such as estimates of the work completed and budget provided in accordance with agreements established with our collaboration partners and third-party service providers. We make estimates in determining the accrued liabilities and prepaid expense balances in each reporting period. As actual costs become known, we adjust our accrued liabilities or prepaid expenses. We have not experienced any material differences between accrued costs and actual costs incurred since our inception.

Previous wording

The fair value of our awards in the three months ended March 31, 2025 has been estimated using Black-Scholes based on the following assumptions: expected term of 6.0 years; expected volatility of 95.3%; risk-free interest rate of 4.5%; and no expectation of dividends. The fair value of our awards in the three months ended March 31, 2024 has been estimated using Black-Scholes based on the following assumptions: expected term of 5.9 years; expected volatility of 94.6%; risk-free interest rate of 3.9%; and no expectation of dividends.

Current wording

The fair value of our awards in the six months ended June 30, 2025 has been estimated using Black-Scholes based on the following assumptions: expected term of 5.9 years; expected volatility of 95.9%; risk-free interest rate of 4.4%; and no expectation of dividends. The fair value of our awards in the six months ended June 30, 2024 has been estimated using Black-Scholes based on the following assumptions: expected term of 5.3 years; expected volatility of 99.3%; risk-free interest rate of 4.2%; and no expectation of dividends.

Previous wording

Refer to Note 2, “Summary of Significant Accounting Policies,” in the accompanying notes to our consolidated financial statements for the three months ended March 31, 2025 and 2024 appearing elsewhere in this Quarterly Report on Form 10-Q for a discussion of recent accounting pronouncements.

Current wording

Refer to Note 2, “Summary of Significant Accounting Policies,” in the accompanying notes to our consolidated financial statements for the six months ended June 30, 2025 and 2024 appearing elsewhere in this Quarterly Report on Form 10-Q for a discussion of recent accounting pronouncements.