Aclaris Therapeutics, Inc.

Previous wording

We intend to further develop ATI-2138 in alopecia areata and are exploring the potential of ATI-2138 in additional indications that are relevant to the mechanism of action, including vitiligo.

Current wording

We are exploring the potential of ATI-2138 in additional indications that are relevant to the mechanism of action, including lichen planus, scarring alopecias, and alopecia areata. We plan to initiate a Phase 2 trial in the additional indication in the first half of 2026.

Previous wording

ATI-052 is an investigational, novel, humanized anti-TSLP and anti-interleukin-4 receptor (“IL-4R”) bispecific antibody that exhibits high binding affinity to and dual blockade of both the upstream TSLP receptor signal transduction and downstream IL-4R activation thereby inhibiting this central proinflammatory pathway. ATI-052 targets TSLP, which sits at the top of the inflammatory cascade; by targeting IL-4R, it blocks both downstream IL-4 and IL-13, which are key cytokines involved in Th2-mediated inflammation and allergic diseases. ATI-052 utilizes the same TSLP antigen-binding fragment (“Fab”) as bosakitug but is engineered to bind more tightly to the neonatal Fc receptor (“FcRn”), potentially extending its half-life. ATI-052 has the potential to treat a variety of atopic, immunologic and respiratory diseases. We exclusively license global rights (excluding Greater China) to ATI-052 from Biosion.

Current wording

ATI-052 is an investigational, novel, humanized anti-TSLP and anti-interleukin-4 receptor (“IL-4R”) bispecific antibody that exhibits high binding affinity to and dual blockade of both the upstream TSLP receptor signal transduction and downstream IL-4R activation thereby inhibiting this central proinflammatory pathway. ATI-052 targets TSLP, which sits at the top of the inflammatory cascade; by targeting IL-4R, it blocks both downstream IL-4 and IL-13, which are key cytokines involved in Th2-mediated inflammation and allergic diseases. ATI-052 utilizes the same TSLP antigen-binding fragment (“Fab”) as bosakitug but is engineered to bind more tightly to the neonatal Fc receptor (“FcRn”), potentially extending its half-life. In addition, the AQQ mutation in the Fc limits effector functionality, reducing off-target binding and potential toxicity. ATI-052 has the potential to treat a variety of atopic, immunologic and respiratory diseases. We exclusively license global rights (excluding Greater China) to ATI-052 from Biosion.

Previous wording

volunteers receiving single ascending doses (“SAD”) and multiple ascending doses (“MAD”). The Phase 1b proof-of-concept assessment in up to two undisclosed indications is expected to follow the Phase 1a SAD/MAD portion of the program. We expect to announce top-line results from the Phase 1a SAD/MAD portion in early 2026, followed by the top-line results from the Phase 1b portion in the second half of 2026.

Current wording

Our Investigational New Drug (“IND”) application for ATI-052 was cleared by the U.S. Food and Drug Administration (“FDA”) in April 2025, and in June 2025, we initiated a Phase 1a/1b program. The randomized, blinded, placebo-controlled Phase 1a portion is designed to evaluate the safety, tolerability, PK and PD of ATI-052 in healthy volunteers receiving single ascending doses (“SAD”) and multiple ascending doses (“MAD”). We expect to announce top-line results from the Phase 1a SAD/MAD portion in early 2026. We plan to initiate Phase 1b proof-of-concept trials in asthma (subject to IND submission and clearance) and atopic dermatitis in the first half of 2026, with top-line results from both trials expected in the second half of 2026.

Previous wording

In addition to our small molecule discovery efforts, we maintain capabilities in biologics discovery to complement our therapeutic portfolio. Through our integrated discovery platform, we can progress biologics candidates from concept through lead optimization, employing robust screening cascades and protein characterization techniques to identify molecules with desired therapeutic properties. This complementary approach to our small molecule programs enables us to pursue optimal therapeutic modalities for each target and indication of interest. For example, we are conducting pre-clinical research to develop next-generation bispecific antibodies utilizing the bosakitug anti-TSLP binding region paired with binding fragments targeting other undisclosed cytokine signaling pathways.

Current wording

We conduct small molecule drug discovery through KINect, our proprietary drug discovery platform. We also engage in discovery efforts for novel, injectable, multi-specific antibodies. Through our integrated discovery approach, we can progress product candidates from concept through lead optimization, employing robust screening cascades and protein characterization techniques to identify molecules with desired therapeutic properties.

Previous wording

Our focus has been on difficult to drug kinase targets that exhibit some level of clinical, genetic and/or pharmacological disease validation. Our approach involves the following mechanisms: (1) reversible and irreversible covalent inhibitors, (2) molecular glue/complex targeted inhibitors and (3) targeted protein degraders. These novel

Current wording

Our KINect platform allows us to address challenges associated with difficult to drug kinases including selectivity and biochemical efficiency, through a unique combination of our proprietary chemical library of kinase inhibitors, our novel approaches to inhibitor modalities, our expertise in structure-based drug design, and our custom kinase assays. Our approach involves the following mechanisms: (1) reversible and irreversible covalent inhibitors, (2) molecular glue/complex targeted inhibitors, (3) tissue specific inhibitors, and (4) targeted protein degraders. These novel approaches are currently being utilized to prosecute additional validated, difficult to drug kinase targets with the goal of demonstrating broad target utility. Our small molecule discovery efforts center on targeting kinases that play pivotal roles in various inflammatory and autoimmune pathways.

Previous wording

Lepzacitinib (ATI-1777) is an investigational topical “soft” JAK 1/3 inhibitor for the potential treatment of atopic dermatitis and potentially other dermatologic conditions. “Soft” JAK inhibitors are designed to be topically applied and active in the skin, but rapidly metabolized and inactivated when they enter the bloodstream, which may result in low systemic exposure.

Current wording

Lepzacitinib (ATI-1777) is an investigational topical “soft” JAK 1/3 inhibitor for the potential treatment of atopic dermatitis and potentially other dermatologic conditions. “Soft” JAK inhibitors are designed to be topically applied and active in the skin, but rapidly metabolized and inactivated when they enter the bloodstream, which may result in low systemic exposure. We are currently seeking a global development and commercialization partner for this program (excluding Greater China). In 2022, we granted Pediatrix Therapeutics, Inc. (“Pediatrix”) exclusive rights to develop and commercialize lepzacitinib in Greater China.

Previous wording

Since our inception, we have incurred significant net losses. Our net loss was 30.5 million for the six months ended June 30, 2025 and $132.1 million for the year ended December 31, 2024. As of June 30, 2025, we had an accumulated deficit of $933.4 million. We expect to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates from discovery through preclinical and clinical development. In addition, our product candidates, even if they are approved by regulatory agencies for marketing, may not achieve commercial success. We may also not be successful in pursuing strategic alternatives, including identifying and consummating transactions with third-party partners, to further develop, obtain marketing approval for and/or commercialize our product candidates. Furthermore, we have incurred and expect to continue to incur significant costs associated with operating as a public company, including legal, accounting, investor relations and other expenses. As a result, we will need substantial additional funding to support our continuing operations.

Current wording

Since our inception, we have incurred significant net losses. Our net loss was $45.1 million for the nine months ended September 30, 2025 and $132.1 million for the year ended December 31, 2024. As of September 30, 2025, we had an accumulated deficit of $948.0 million. We expect to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates from discovery through preclinical and clinical development. In addition, our product candidates, even if they are approved by regulatory agencies for marketing, may not achieve commercial success. We may also not be successful in pursuing strategic alternatives, including identifying and consummating transactions with third-party partners, to further develop, obtain marketing approval for and/or commercialize our product candidates. Furthermore, we have incurred and expect to continue to incur significant costs associated with operating as a public company, including legal, accounting, investor relations and other expenses. As a result, we will need substantial additional funding to support our continuing operations.

Previous wording

We have historically financed our operations primarily with sales of equity securities and incurring indebtedness in the form of loans from commercial lenders. In the near term, we expect to finance our operations through these and other capital sources, including potential partnerships with other companies or other strategic transactions. We may be unable to raise additional funds or enter into such other agreements or arrangements when needed on commercially acceptable terms, or at all. If we fail to raise capital or enter into such agreements as, and when needed, we may have to significantly delay, scale back or discontinue the development of one or more of our product candidates.

Current wording

We have historically financed our operations primarily with sales of equity securities and non-dilutive financing. In the near term, we expect to finance our operations through these and other capital sources, including potential partnerships with other companies or other strategic transactions. We may be unable to raise additional funds or enter into such other agreements or arrangements when needed on commercially acceptable terms, or at all. If we fail to raise capital or enter into such agreements as, and when needed, we may have to significantly delay, scale back or discontinue the development of one or more of our product candidates.

Previous wording

Unfavorable conditions in the economy both in the United States and abroad may negatively affect the growth of our business and our results of operations. For example, macroeconomic events, including inflationary pressure, tariff policies and geopolitical conflicts, have led to economic uncertainty globally. The effect of macroeconomic conditions may not be fully reflected in our results of operations until future periods. If, however, economic uncertainty increases or the global economy worsens, our business, financial condition and results of operations may be harmed.

Current wording

Unfavorable conditions in the economy both in the United States and abroad may negatively affect the growth of our business and our results of operations. For example, macroeconomic events, including inflationary pressure, tariff policies, geopolitical conflicts, and the current shutdown of the U.S. federal government, have led to economic uncertainty globally. The effect of macroeconomic conditions may not be fully reflected in our results of operations until future periods. If, however, economic uncertainty increases or the global economy worsens, our business, financial condition and results of operations may be harmed.

Previous wording

In July 2024, we entered into a royalty purchase agreement with OCM IP Healthcare Portfolio LP, an investment vehicle for Ontario Municipal Employees Retirement System (“OMERS”). Under the royalty purchase agreement, we sold to OMERS a portion of the future royalty payments and the remaining anniversary payments associated with our existing license to Eli Lilly and Company (“Lilly”), relating to OLUMIANT® (baricitinib) for the treatment of alopecia areata (see “—License Agreement with Eli Lilly and Company”). Under the terms of the royalty purchase agreement, we received an upfront payment of $26.5 million. In exchange, OMERS acquired a portion of the royalty payable by Lilly to us for worldwide net sales of OLUMIANT for the treatment of alopecia areata from April 1, 2024 through the remainder of the royalty term under our license agreement with Lilly, and 100% of the remaining anniversary milestone payments payable by Lilly to us under the license agreement. The royalty payments and milestones we sold to OMERS represent our entire financial interest in the Lilly license agreement after taking into account our other contractual third-party obligations.

Current wording

sold to OMERS a portion of the future royalty payments and the remaining anniversary payments associated with our existing license to Eli Lilly and Company (“Lilly”), relating to OLUMIANT® (baricitinib) for the treatment of alopecia areata (see “—License Agreement with Eli Lilly and Company”). Under the terms of the royalty purchase agreement, we received an upfront payment of $26.5 million. In exchange, OMERS acquired a portion of the royalty payable by Lilly to us for worldwide net sales of OLUMIANT for the treatment of alopecia areata from April 1, 2024 through the remainder of the royalty term under our license agreement with Lilly, and 100% of the remaining anniversary milestone payments payable by Lilly to us under the license agreement. The royalty payments and milestones we sold to OMERS represent our entire financial interest in the Lilly license agreement after taking into account our other contractual third-party obligations.

Previous wording

In December 2023, we entered into an exclusive patent license agreement with Sun Pharmaceutical Industries, Inc. (“Sun Pharma”). Under the license agreement, we granted Sun Pharma exclusive rights under certain patents that we exclusively license from a third party. The patents relate to the use of deuruxolitinib, Sun Pharma’s JAK inhibitor, or other isotopic forms of ruxolitinib, to treat alopecia areata or androgenetic alopecia. Under the license agreement, Sun Pharma has paid us upfront and regulatory payments, and has agreed to pay us other regulatory and commercial milestone payments upon the achievement of specified milestones set forth in the agreement, and a mid single-digit tiered royalty calculated as a percentage of Sun Pharma’s net sales. We have separate contractual obligations under which we have agreed to pay to third parties a portion of the consideration we may receive under the license agreement. We may seek to monetize this asset.

Current wording

In December 2023, we entered into an exclusive patent license agreement with Sun Pharmaceutical Industries, Inc. (“Sun Pharma”). Under the license agreement, we granted Sun Pharma exclusive rights under certain patents that we exclusively license from a third party. The patents relate to the use of deuruxolitinib, Sun Pharma’s JAK inhibitor, or other isotopic forms of ruxolitinib, to treat alopecia areata or androgenetic alopecia. Under the license agreement, Sun Pharma has paid us upfront, regulatory and commercial milestone payments, and has agreed to pay us other regulatory and commercial milestone payments upon the achievement of specified milestones set forth in the agreement, and a mid single-digit tiered royalty calculated as a percentage of Sun Pharma’s net sales. We have separate contractual obligations under which we have agreed to pay to third parties a portion of the consideration we may receive under the license agreement. We may seek to monetize this asset.

Previous wording

In November 2022, we entered into a license agreement with Pediatrix under which we granted Pediatrix the exclusive rights to develop, manufacture and commercialize lepzacitinib in Greater China. Pediatrix has paid us an upfront payment, and has agreed to pay us development, regulatory and commercial milestone payments upon the achievement of specified milestones set forth in the agreement, and a tiered royalty ranging from a low-to-high single digit percentage of net sales of lepzacitinib by Pediatrix in Greater China. A portion of the consideration received from Pediatrix is payable to the former Confluence equity holders as described below under the caption “—Agreement and Plan of Merger with Confluence.”

Current wording

In November 2022, we entered into a license agreement with Pediatrix under which we granted Pediatrix the exclusive rights to develop, manufacture and commercialize lepzacitinib in Greater China. Pediatrix has paid us an upfront payment, and has agreed to pay us development, regulatory and commercial milestone payments upon the achievement of specified milestones set forth in the agreement, and a tiered royalty ranging from a low-to-high single digit percentage of net sales of lepzacitinib by Pediatrix in Greater China. A portion of the consideration received from Pediatrix is payable to the former Confluence (as defined below) equity holders as described below under the caption “—Agreement and Plan of Merger with Confluence.”

Previous wording

agreement, we granted Lilly non-exclusive rights under certain patents and patent applications that we exclusively license from a third party. The patents and patent applications relate to the use of baricitinib, Lilly’s JAK inhibitor, to treat alopecia areata. Under the license agreement, Lilly has paid us upfront, anniversary, regulatory and commercial milestone payments. In addition, Lilly has agreed to pay us other commercial milestone payments upon the achievement of specified milestones and additional anniversary payments as set forth in the agreement, as well as a low single-digit royalty calculated as a percentage of Lilly’s net sales of baricitinib for the treatment of alopecia areata. We have separate contractual obligations under which we have agreed to pay to third parties an amount equal to any regulatory and commercial milestone payments we receive under the Lilly license agreement, as well as a portion of the upfront consideration and a portion of the royalties we may receive under the license agreement. In July 2024, we entered into a royalty purchase agreement with OMERS pursuant to which we sold to OMERS a portion of our future royalty payments and the remaining anniversary payments associated with the license to Lilly (see “—Royalty Purchase Agreement with OCM IP Healthcare Portfolio LP” above).

Current wording

In August 2022, we entered into a non-exclusive patent license agreement with Lilly. Under the license agreement, we granted Lilly non-exclusive rights under certain patents and patent applications that we exclusively license from a third party. The patents and patent applications relate to the use of baricitinib, Lilly’s JAK inhibitor, to treat alopecia areata. Under the license agreement, Lilly has paid us upfront, anniversary, regulatory and commercial milestone payments. In addition, Lilly has agreed to pay us other commercial milestone payments upon the achievement of specified milestones and additional anniversary payments as set forth in the agreement, as well as a low single-digit royalty calculated as a percentage of Lilly’s net sales of baricitinib for the treatment of alopecia areata. We have separate contractual obligations under which we have agreed to pay to third parties an amount equal to any regulatory and commercial milestone payments we receive under the Lilly license agreement, as well as a portion of the upfront consideration and a portion of the royalties we may receive under the license agreement. In July 2024, we entered into a royalty purchase agreement with OMERS pursuant to which we sold to OMERS a portion of our future royalty payments and the remaining anniversary payments associated with the license to Lilly (see “—Royalty Purchase Agreement with OCM IP Healthcare Portfolio LP” above).

Previous wording

We recognized $1.3 million and $2.3 million of licensing revenue during the three and six months ended June 30, 2025, respectively, all of which was payable to third parties. We recognized $2.1 million and $3.9 million of licensing revenue during the three and six months ended June 30, 2024, respectively, a portion of which was payable to third parties.

Current wording

We recognized $1.3 million and $3.6 million of licensing revenue during the three and nine months ended September 30, 2025, respectively, all of which was payable to third parties. We recognized $0.7 million and $4.6 million of licensing revenue during the three and nine months ended September 30, 2024, respectively, a portion of which was payable to third parties.

Previous wording

In October 2019, we sold RHOFADE (oxymetazoline hydrochloride) cream, 1% (“RHOFADE”), to EPI Health, LLC (“EPI Health”) pursuant to an asset purchase agreement. In July 2023, EPI Health filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code. Through the bankruptcy process, EPI Health and its parent company, Novan, Inc., sold the RHOFADE assets to a third party, which excluded our asset purchase agreement with EPI Health and the outstanding amounts due. The sale was approved by the bankruptcy court in September 2023. As a result of the bankruptcy proceedings, all amounts that are due and outstanding by EPI Health have been fully reserved.

Current wording

In October 2019, we sold RHOFADE (oxymetazoline hydrochloride) cream, 1% (“RHOFADE”), to EPI Health, LLC (“EPI Health”) pursuant to an asset purchase agreement. In July 2023, EPI Health filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code. Through the bankruptcy process, EPI Health and its parent company, Novan, Inc., sold the RHOFADE assets to a third party, which excluded our asset purchase agreement with EPI Health and the outstanding amounts due. The sale was approved by the bankruptcy court in September 2023. As a result of the bankruptcy proceedings, all amounts that were due and outstanding by EPI Health had been fully reserved. During the three months ended September 30, 2025, we sold all of our right, title and interest in our bankruptcy claims against EPI Health and wrote off the remaining reserved balance as it was deemed uncollectible.

Previous wording

In 2017, we entered into an Agreement and Plan of Merger (the “Confluence Agreement”), with Confluence, Aclaris Life Sciences, Inc., our wholly owned subsidiary (“Merger Sub”), and Fortis Advisors LLC, as representative of the equity holders of Confluence. Pursuant to the terms of the Confluence Agreement, Merger Sub merged with and into Confluence, with Confluence surviving as our wholly owned subsidiary.

Current wording

In 2017, we entered into an Agreement and Plan of Merger (the “Confluence Agreement”), with Confluence Life Sciences, Inc. (now known as Aclaris Life Sciences, Inc.) (“Confluence”), Aclaris Life Sciences, Inc., our wholly owned subsidiary (“Merger Sub”), and Fortis Advisors LLC, as representative of the equity holders of Confluence. Pursuant to the terms of the Confluence Agreement, Merger Sub merged with and into Confluence, with Confluence surviving as our wholly owned subsidiary.

Previous wording

In December 2023, our board of directors approved a reduction of our workforce by approximately 46%, which was completed as of December 31, 2024. During the six months ended June 30, 2025, we made cash severance payments of $0.2 million to impacted employees. During the three and six months ended June 30, 2024, we recognized severance expense of $0.1 million and $2.6 million, respectively, and made cash severance payments of $4.5 million to impacted employees during the six months ended June 30, 2024.

Current wording

In December 2023, our board of directors approved a reduction of our workforce by approximately 46%, which was completed as of December 31, 2024. During the nine months ended September 30, 2025, we made cash severance payments of $0.2 million to impacted employees. During the three and nine months ended September 30, 2024, we recognized severance expense of $26 thousand and $2.6 million, respectively, and made cash severance payments of $5.2 million to impacted employees during the nine months ended September 30, 2024.

Previous wording

The fair value of contingent consideration is estimated using a probability-weighted expected payment model for regulatory milestone payments and a Monte Carlo simulation model for commercial milestone and royalty payments and then applying a risk-adjusted discount rate to calculate the present value of the potential payments. Significant assumptions used in our estimates include the probability of achieving regulatory milestones and commencing commercialization (collectively referred to as “probability of success”), which are based on an asset’s current stage of development and a review of existing clinical data. Probability of success assumptions ranged between 21% and 40% at June 30, 2025. Additionally, estimated future sales levels and the risk-adjusted discount rate applied to the potential payments are also significant assumptions used in calculating the fair value. As of June 30, 2025, the discount rate ranged between 6.3% and 7.9% depending on the year of each potential payment.

Current wording

The fair value of contingent consideration is estimated using a probability-weighted expected payment model for regulatory milestone payments and a Monte Carlo simulation model for commercial milestone and royalty payments and then applying a risk-adjusted discount rate to calculate the present value of the potential payments. Significant assumptions used in our estimates include the probability of achieving regulatory milestones and commencing commercialization (collectively referred to as “probability of success”), which are based on an asset’s current stage of development and a review of existing clinical data. Probability of success assumptions ranged between 21% and 40% at September 30, 2025. Additionally, estimated future sales levels and the risk-adjusted discount rate applied to the potential payments are also significant assumptions used in calculating the fair value. As of September 30, 2025, the discount rate ranged between 6.8% and 8.4% depending on the year of each potential payment.

Previous wording

During the six months ended June 30, 2025, we recorded a charge to the contingent consideration liability of $1.8 million, which was primarily due to changes to the probability of success for certain product candidates and lower discount rates resulting from changes in credit spreads being applied to potential payments.

Current wording

During the nine months ended September 30, 2025, we recorded a charge to the contingent consideration liability of $1.9 million, which was primarily due to changes to the probability of success for certain product candidates and the passage of time.

Previous wording

Comparison of Three and Six Months Ended June 30, 2025 and 2024

Current wording

Comparison of Three and Nine Months Ended September 30, 2025 and 2024

Previous wording

The decrease in contract research revenue for the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024, respectively, was driven by lower overall hours billed, which was partially offset by a higher average billing rate.

Current wording

The decrease in contract research revenue for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024, respectively, was driven by lower overall hours billed for laboratory services. The decrease during the nine-month period was partially offset by a higher average billing rate.

Previous wording

The decrease in cost of revenue for the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024 was driven by lower overall hours billed for laboratory services.

Current wording

The decrease in cost of revenue for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024 was driven by lower overall hours billed for laboratory services.

Previous wording

The expenses incurred for bosakitug during the three and six months ended June 30, 2025 consisted primarily of product candidate manufacturing costs and clinical development expenses associated with a Phase 2 trial in atopic dermatitis.

Current wording

The expenses incurred for bosakitug during the three and nine months ended September 30, 2025 consisted primarily of product candidate manufacturing costs and clinical development expenses associated with a Phase 2 trial in atopic dermatitis.

Previous wording

The increase in expenses for ATI-2138 during the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024 was primarily due to preclinical development activities and clinical development expenses associated with a Phase 2a trial in atopic dermatitis.

Current wording

The increase in expenses for ATI-2138 during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily due to an increase in preclinical development expenses and clinical development expenses associated with a Phase 2a trial in atopic dermatitis.

Previous wording

Research and development expenses related to ATI-052 for the three and six months ended June 30, 2025 primarily consisted of product candidate manufacturing costs, preclinical development activities, and clinical development expenses associated with a Phase 1a/1b program.

Current wording

Research and development expenses related to ATI-052 for the three and nine months ended September 30, 2025 primarily consisted of product candidate manufacturing costs, preclinical development activities, and clinical development expenses associated with a Phase 1a/1b program.

Previous wording

The increase in personnel expenses during the three months ended June 30, 2025 compared to the three months ended June 30, 2024 was primarily due to higher headcount. The decrease in personnel expenses during the six months ended June 30, 2025 compared to the six months ended June 30, 2024 was primarily due to termination benefits associated with our December 2023 reduction in force recognized during the six months ended June 30, 2024. The increase in stock-

Current wording

The increase in personnel expenses during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was primarily due to higher headcount. The increase in stock-based compensation expense during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was due to higher forfeiture credits during the nine months ended September 30, 2024.

Previous wording

The increase in personnel expenses during the three months ended June 30, 2025 compared to the three months ended June 30, 2024 was primarily due to higher headcount. The increase in stock-based compensation expense during the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024 was due to higher forfeiture credits during the three and six months ended June 30, 2024.

Current wording

The increase in personnel expenses during the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024 was primarily due to higher headcount. The increase in stock-based compensation expense during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was due to higher forfeiture credits during the nine months ended September 30, 2024.

Previous wording

The revaluation of contingent consideration loss increased during the three months ended June 30, 2025 compared to the three months ended June 30, 2024 mainly due to changes to the probability of success for certain product candidates and lower discount rates resulting from changes in credit spreads being applied to potential payments during the three months ended June 30, 2025.

Current wording

The revaluation of contingent consideration loss decreased during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 mainly due to higher discount rates resulting from changes in credit spreads being applied to potential payments during the three months ended September 30, 2025.

Previous wording

The revaluation of contingent consideration loss decreased during the six months ended June 30, 2025 compared to the six months ended June 30, 2024 mainly due to changes in estimated sales levels and changes to the probability of success for certain product candidates during the six months ended June 30, 2024.

Current wording

The revaluation of contingent consideration loss decreased during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 mainly due to changes in estimated sales levels and changes to the probability of success for certain product candidates during the nine months ended September 30, 2024.

Previous wording

Non-cash royalty income includes income related to the proceeds from the sale of a portion of our OLUMIANT® royalty payments to OMERS.

Current wording

Non-cash royalty income includes income related to the proceeds from the sale of a portion of our OLUMIANT® royalty payments to OMERS in July 2024.

Previous wording

Since our inception, we have incurred net losses and negative cash flows from our operations. We have financed our operations over the last several years primarily through sales of our equity securities and incurring indebtedness in the form of loans from commercial lenders. We may engage in additional debt and equity financing transactions in order to raise funds. We may receive royalties and milestone payments under third-party licensing and acquisition agreements. In addition, to the extent we are able to consummate transactions with potential third-party partners to further develop, obtain marketing approval for and/or commercialize our product candidates, we may receive upfront payments, milestone payments or royalties from such arrangements that would increase our liquidity.

Current wording

Since our inception, we have incurred net losses and negative cash flows from our operations. We have financed our operations over the last several years primarily through sales of our equity securities and non-dilutive financing. We may engage in additional equity and other financing transactions in order to raise funds. We may receive royalties and milestone payments under third-party licensing and acquisition agreements. In addition, to the extent we are able to consummate transactions with potential third-party partners to further develop, obtain marketing approval for and/or commercialize our product candidates, we may receive upfront payments, milestone payments or royalties from such arrangements that would increase our liquidity.

Previous wording

As of June 30, 2025, we had cash, cash equivalents and marketable securities of $180.9 million. Cash in excess of immediate requirements is invested in accordance with our investment policy, primarily with a view towards liquidity and capital preservation.

Current wording

As of September 30, 2025, we had cash, cash equivalents and marketable securities of $167.2 million. Cash in excess of immediate requirements is invested in accordance with our investment policy, primarily with a view towards liquidity and capital preservation.

Previous wording

Cash and cash equivalents were $25.4 million as of June 30, 2025 compared to $24.6 million as of December 31, 2024. We also had $155.5 million in short- and long-term marketable securities as of June 30, 2025 compared to $179.3 million as of December 31, 2024.

Current wording

Cash and cash equivalents were $25.3 million as of September 30, 2025 compared to $24.6 million as of December 31, 2024. We also had $142.0 million in short- and long-term marketable securities as of September 30, 2025 compared to $179.3 million as of December 31, 2024.

Previous wording

Net cash used in operating activities decreased for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 primarily as a result of a decrease in cash used for accounts payable and accrued expenses, after adjusting for the receipt and corresponding payment of a third-party milestone during the six months ended June 30, 2025.

Current wording

Net cash used in operating activities increased for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily as a result of proceeds from the royalty sale to OMERS and lower net losses after adjusting for non-cash items during the nine months ended September 30, 2024. This increase was partially offset by a decrease in cash used for accounts payable and accrued expenses, which was due to the timing of payments to vendors and severance payments in connection with the reduction in our workforce.

Previous wording

The increase in net cash provided by investing activities for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 resulted primarily from lower purchases of marketable securities and higher proceeds from sales and maturities of marketable securities during the six months ended June 30, 2025.

Current wording

The increase in net cash provided by investing activities for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 resulted primarily from lower purchases of marketable securities and higher proceeds from sales and maturities of marketable securities during the nine months ended September 30, 2025.

Previous wording

We believe our existing cash, cash equivalents and marketable securities are sufficient to fund our operating and capital expenditure requirements for a period greater than 12 months from the date of issuance of our condensed consolidated financial statements that appear in Item 1 of this Quarterly Report on Form 10-Q based on our current operating assumptions. We will require additional capital to develop our product candidates and to support our discovery efforts. Additional funds may not be available on a timely basis, on commercially acceptable terms, or at all, and such funds, if raised, may not be sufficient to enable us to continue to implement our long-term business strategy. Our ability to raise additional capital may be adversely impacted by potentially worsening global economic conditions caused by a

Current wording

We believe our existing cash, cash equivalents and marketable securities are sufficient to fund our operating and capital expenditure requirements for a period greater than 12 months from the date of issuance of our condensed consolidated financial statements that appear in Item 1 of this Quarterly Report on Form 10-Q based on our current operating assumptions. We will require additional capital to develop our product candidates and to support our discovery efforts. Additional funds may not be available on a timely basis, on commercially acceptable terms, or at all, and such funds, if raised, may not be sufficient to enable us to continue to implement our long-term business strategy. Our ability to raise additional capital may be adversely impacted by potentially worsening global economic conditions caused by a variety of factors including geopolitical tensions, tariff policies, inflationary pressures, and the current shutdown of the U.S. federal government. If we are unable to raise sufficient additional capital or generate revenue from transactions with potential third-party partners for the development and/or commercialization of our product candidates, we may need to substantially curtail our planned operations.

Previous wording

Our aggregate remaining lease payment obligation for these two spaces was $2.9 million as of June 30, 2025.

Current wording

Our aggregate remaining lease payment obligation for these two spaces was $2.7 million as of September 30, 2025.

Previous wording

We have agreed to certain payment obligations in accordance with and subject to the terms of the Confluence Agreement (see “Overview—Acquisition and License Agreements—Agreement and Plan of Merger with Confluence”). As of June 30, 2025, the balance of our contingent consideration liability was $10.5 million.

Current wording

We have agreed to certain payment obligations in accordance with and subject to the terms of the Confluence Agreement (see “Overview—Acquisition and License Agreements—Agreement and Plan of Merger with Confluence”). As of September 30, 2025, the balance of our contingent consideration liability was $10.6 million.