Aclaris Therapeutics, Inc.
For the period ended Sep 30, 2026. Filed Nov 5, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 5, 2026
ACRS$3.90+8.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-08-06.
0001104659-26-092065
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-05.
0001104659-26-123374
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 167 previous paragraphs and 178 current paragraphs.
113 unchanged; 43 reworded; 15 added; 3 removed; 8 previous and 7 current paragraphs rearranged.
Tables are not compared: 33 previous and 33 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (15)
Current report
In October 2026, we announced positive primary analysis results from two randomized, double-blind, placebo-controlled Phase 1b proof-of-concept (“POC”) trials of ATI-052 in patients with atopic dermatitis (“AD”) and asthma.
Current report
The Phase 1b POC trial in AD randomized 14 patients with severe AD to receive five weekly doses of 480 mg of ATI-052 or placebo. At day 57, patients in the prespecified per-protocol population (ATI-052, N=9; placebo, N=1) treated with ATI-052 experienced a 45% placebo-adjusted mean improvement from baseline in EASI score, a 78% placebo-adjusted EASI-50 response, and a 43% placebo-adjusted mean improvement in PP-NRS score. Among ATI-052-treated patients who completed the trial through day 57, proteomic analyses showed a 95% overall improvement in lesional skin with immune protein expression resembling that of non-lesional skin. ATI-052 also broadly downregulated inflammatory mediators in AD including Th1, Th2, Th17/Th22, fibrosis/extracellular matrix remodeling and itch-associated pathways, and reduced endogenous serum biomarkers including CCL17, IL-5 and blood eosinophils.
Current report
The Phase 1b POC trial in asthma randomized 16 patients with mild-to-moderate asthma and baseline fractional exhaled nitric oxide (“FeNO”) of at least 35 parts per billion to receive a single 480 mg dose of ATI-052 or placebo (ATI-052, N=12; placebo, N=4). At day 15, patients treated with ATI-052 experienced a 59% mean reduction from baseline in FeNO compared with a 15% mean reduction for placebo, and 58% achieved FeNO normalization (25 parts per billion or less). Patients treated with ATI-052 also experienced a 200 mL placebo-adjusted mean improvement in forced expiratory volume in one second (“FEV1”) at day 15.
Current report
ATI-052 was well tolerated across both Phase 1b trials and demonstrated a favorable safety profile with no conjunctivitis observed.
Current report
We intend to initiate a Phase 2b trial in eosinophilic esophagitis in early 2027. We are also exploring the potential development of ATI-052 in either asthma or AD.
Current report
Personnel and stock-based compensation
Current report
Other general and administrative
Current report
The increase in other general and administrative expenses during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to the sale of our bankruptcy claims against EPI Health during the three and nine months ended September 30, 2025.
Current report
The decrease in licensing expense during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to a sales milestone achieved under the Sun Pharma license agreement during the three and nine months ended September 30, 2025, a portion of which was due to third parties.
Current report
The change from a loss on revaluation of contingent consideration during the three months ended September 30, 2025 to a gain during the three months ended September 30, 2026 was primarily due to higher discount rates and changes in estimated sales levels during the three months ended September 30, 2026. The change from a loss on revaluation of
Current report
In July 2026, we sold an aggregate of 7.3 million shares of our common stock for gross proceeds of $40.2 million, pursuant to an amended and restated sales agreement with Leerink Partners LLC and Cantor Fitzgerald & Co., as sales agents, dated February 27, 2025. We paid selling commissions and other fees of $1.2 million in connection with the sales.
Current report
In September 2026, we sold an aggregate of 3.6 million shares of our common stock for gross proceeds of $20.0 million, pursuant to a second amended and restated sales agreement with Leerink Partners LLC and Cantor Fitzgerald &
Current report
Co., as sales agents, dated August 6, 2026. We paid selling commissions and other fees of $0.6 million in connection with the sales.
Current report
October 2026 Offering
Current report
In October 2026, we closed an offering in which we issued and sold 7,785,714 shares of common stock at a price of $3.50 per share and pre-funded warrants to purchase 6,500,000 shares of common stock at a price of $3.49999 per warrant, for aggregate gross proceeds of $50.0 million. Net proceeds from the offering were $46.7 million, after deducting underwriting discounts and commissions and offering expenses.
Removed paragraphs (3)
Previous report
We initiated a Phase 1b proof-of-concept trial with ATI-052 in atopic dermatitis in January 2026 and a Phase 1b proof-of-concept trial in asthma in February 2026, with top-line data from both studies expected in the second half of 2026. We plan to initiate a Phase 2b program for ATI-052, commencing with a Phase 2b trial in asthma in the fourth quarter of 2026. We also expect to commence startup activities for a Phase 2b trial in atopic dermatitis and for a proof-of-concept trial in eosinophilic esophagitis.
Previous report
Personnel
Previous report
The increase in licensing expense during the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was due to higher royalties earned under the Lilly and Sun Pharma license agreements.
Reworded paragraphs (43)
Previous wording
Certain statements contained in this Quarterly Report on Form 10-Q may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The words “may,” “might,” “can,” “will,” “to be,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “objective,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “likely,” “continue,” “ongoing” or similar expressions, or the negative of such words, are intended to identify “forward-looking statements.” We have based these forward-looking statements on our current expectations and projections about future events. Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to these differences include those under the caption “Risk Factors” in this Quarterly Report on Form 10-Q, our Annual Report on Form 10-K filed with the SEC on February 26, 2026 (“Annual Report”), and in our other filings with the Securities and Exchange Commission (“SEC”). Statements made herein are as of the date of the filing of this Form 10-Q with the SEC and should not be relied upon as of any subsequent date. Unless otherwise required by applicable law, we do not undertake, and we specifically disclaim, any obligation to update any forward-looking statements to reflect occurrences, developments, unanticipated events or circumstances after the date of such statement.
Current wording
Certain statements contained in this Quarterly Report on Form 10-Q may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The words “may,” “might,” “can,” “will,” “to be,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “objective,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “likely,” “continue,” “ongoing” or similar expressions, or the negative of such words, are intended to identify “forward-looking statements.” We have based these forward-looking statements on our current expectations and projections about future events. Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to these differences include those under the caption “Risk Factors” in this Quarterly Report on Form 10-Q, our Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 26, 2026 (“Annual Report”), and in our other filings with the SEC. Statements made herein are as of the date of the filing of this Form 10-Q with the SEC and should not be relied upon as of any subsequent date. Unless otherwise required by applicable law, we do not undertake, and we specifically disclaim, any obligation to update any forward-looking statements to reflect occurrences, developments, unanticipated events or circumstances after the date of such statement.
Previous wording
ATI-052 is an investigational, novel, humanized anti-TSLP and anti-interleukin-4 receptor (“IL-4Rα”) bispecific antibody that exhibits high binding affinity to and dual blockage of both the upstream TSLP receptor signal transduction and downstream IL-4Rα activation thereby inhibiting this central proinflammatory pathway. ATI-052 binds TSLP, which sits at the top of the inflammatory cascade; by targeting IL-4Rα, it blocks downstream signaling of both IL-4 and IL-13, two anti-inflammatory cytokines, which are critical components of Th2-mediated immunity and play a crucial role in the pathogenesis of 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.
Current wording
ATI-052 is an investigational, novel, humanized anti-TSLP and anti-interleukin-4 receptor (“IL-4Rα”) bispecific antibody that exhibits high binding affinity to and dual blockade of both the upstream TSLP receptor signal transduction and downstream IL-4Rα activation thereby inhibiting this central proinflammatory pathway. ATI-052 binds TSLP, which sits at the top of the inflammatory cascade; by targeting IL-4Rα, it blocks downstream signaling of both IL-4 and IL-13, two proinflammatory cytokines, which are critical components of Th2-mediated immunity and play a crucial role in the pathogenesis of 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
In July 2025, we announced positive top-line results from our open-label, single-arm Phase 2a trial of modzatinib in patients with moderate to severe atopic dermatitis. The trial met the primary and key secondary safety, efficacy, and pharmacodynamic endpoints. Modzatinib demonstrated near complete and sustained inhibition and occupancy of ITK. Proteome and transcriptome lesional skin tape strip analyses showed significant reductions of multiple inflammatory
Current wording
In July 2025, we announced positive top-line results from our open-label, single-arm Phase 2a trial of modzatinib in patients with moderate to severe atopic dermatitis. The trial met the primary and key secondary safety, efficacy, and pharmacodynamic endpoints. Modzatinib demonstrated near complete and sustained inhibition and occupancy of ITK. Proteome and transcriptome lesional skin tape strip analyses showed significant reductions of multiple inflammatory pathways associated with ITK, including strong downregulation of Th2, Th17, and TCR pathways, along with the Th1 pathway and fibrosis-related markers.
Previous wording
In April 2026, we announced plans to conduct a phased multi-part Phase 2b basket study of modzatinib in the three most common subtypes of lichen planus: erosive mucosal, cutaneous and lichen planopilaris. Lichen planus is an unaddressed chronic, inflammatory, CD8 cytotoxic T-cell-driven interface dermatitis. We expect to initiate Part A (erosive mucosal; cutaneous) of this trial in the fourth quarter of 2026 and intend to initiate Part B (lichen planopilaris) soon thereafter. We are also exploring the potential of modzatinib in additional indications that are relevant to the dual pharmacology and mechanism of action, including other inflammatory disorders.
Current wording
We plan to conduct a phased Phase 2b basket study of modzatinib in the three most common subtypes of lichen planus: oral erosive lichen planus, cutaneous lichen planus and lichen planopilaris. Lichen planus is an unaddressed chronic, inflammatory, CD8 cytotoxic T-cell-driven interface dermatitis that affects the skin, mucous membranes, hair follicles and nails. We expect to initiate the Phase 2b trial with the oral erosive lichen planus cohort in the fourth quarter of 2026.
Previous wording
We are developing ATI-9494, a highly potent, oral, covalent, investigational dual inhibitor of ITK and Resting Lymphocyte Kinase (TXK), and other covalent JAK-sparing ITK inhibitors with differentiated pharmacological properties and selectivity profiles. These inhibitors have the potential to differentially modulate T cell biology across a broad range of disease indications with extended half-lives and potential best-in-class potency, ITK occupancy, and ITK activation at low doses. We expect to file an IND application for ATI-9494 in the fourth quarter of 2026.
Current wording
We are developing ATI-9494, a highly potent, oral, covalent, investigational dual inhibitor of ITK and Resting Lymphocyte Kinase (TXK), and other covalent JAK-sparing ITK inhibitors with differentiated pharmacological properties and selectivity profiles. These inhibitors have the potential to differentially modulate T cell biology across a broad range of disease indications with extended half-lives and potential best-in-class potency, ITK occupancy, and ITK activation at low doses. We expect to file an Investigational New Drug (“IND”) application for ATI-9494 in the fourth quarter of 2026.
Previous wording
Our discovery efforts to develop multi-specific antibodies are focused on generating antibodies with superior target affinity, specificity, and potency utilizing combinations of (a) two or more clinically validated targets with non-overlapping biology, (b) clinically validated targets with novel biology, and/or (c) synergistic target combinations in an effort to address shortcomings of single drug administration. 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 progressing several bispecific antibodies utilizing the bosakitug anti-TSLP binding region paired with binding fragments targeting other undisclosed cytokine signaling pathways.
Current wording
Our discovery efforts to develop multi-specific antibodies are focused on generating antibodies with superior target affinity, specificity, and potency utilizing combinations of (a) two or more clinically validated targets with non-overlapping biology, (b) clinically validated targets with novel biology, and/or (c) synergistic target combinations in an effort to address shortcomings of single drug administration. 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 progressing multi-specific antibodies utilizing the bosakitug anti-TSLP binding region paired with binding fragments targeting other undisclosed cytokine signaling 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. We are currently seeking a global development and commercialization partner for this program
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 $41.3 million for the six months ended June 30, 2026 and $64.9 million for the year ended December 31, 2025. As of June 30, 2026, we had an accumulated deficit of $1.0 billion. 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 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 $59.8 million for the nine months ended September 30, 2026 and $64.9 million for the year ended December 31, 2025. As of September 30, 2026, we had an accumulated deficit of $1.0 billion. 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 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
In November 2024, we entered into an exclusive license agreement (the “Biosion Agreement”) with Biosion pursuant to which we received the exclusive rights to develop, manufacture and commercialize bosakitug (ATI-045) and ATI-052 worldwide, excluding Greater China. In connection with the Biosion Agreement, we also entered into a collaboration agreement (together with the Biosion Agreement, the “Biosion Agreements”) with Biosion and CTTQ, a licensee of bosakitug in Greater China.
Current wording
worldwide, excluding Greater China. In connection with the Biosion Agreement, we also entered into a collaboration agreement (together with the Biosion Agreement, the “Biosion Agreements”) with Biosion and CTTQ, a licensee of bosakitug in Greater China.
Previous wording
In addition, we agreed to pay, in the aggregate, (i) up to $125 million upon the achievement of specified regulatory milestones commencing with product approval, (ii) up to $795 million upon the achievement of specified sales milestones, (iii) a tiered low-to-mid single digit royalty based upon a percentage of annual net sales, subject to specified reductions as set forth in the Biosion Agreement, and (iv) a portion of any sublicense consideration received from the grant of any
Current wording
In addition, we agreed to pay, in the aggregate, (i) up to $125 million upon the achievement of specified regulatory milestones commencing with product approval, (ii) up to $795 million upon the achievement of specified sales milestones, (iii) a tiered low-to-mid single digit royalty based upon a percentage of annual net sales, subject to specified reductions as set forth in the Biosion Agreement, and (iv) a portion of any sublicense consideration received from the grant of any sublicense or similar rights under any of the rights or licenses granted to us under the Biosion Agreement. We will expense these payments in the period when either they are determined to be probable of occurring or when the payment is triggered.
Previous wording
We recognized $1.0 million of non-cash royalty income related to the OMERS agreement for each of the three months ended June 30, 2026 and 2025, and $1.8 million for each of the six months ended June 30, 2026 and 2025.
Current wording
We recognized $1.0 million and $0.7 million of non-cash royalty income related to the OMERS agreement for the three months ended September 30, 2026 and 2025, respectively, and $2.8 million and $2.5 million for the nine months ended September 30, 2026 and 2025, respectively.
Previous wording
We recognized $0.1 million and $0.3 million of licensing revenue related to the Sun Pharma agreement during the three and six months ended June 30, 2026, respectively, a portion of which was payable to third parties.
Current wording
We recognized $0.1 million and $0.4 million of licensing revenue related to the Sun Pharma agreement during the three and nine months ended September 30, 2026, respectively, a portion of which was payable to third parties, and $1.5 million of licensing revenue during each of the three and nine months ended September 30, 2025, a portion of which was payable to third parties.
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 (as defined below) equity holders as described below under the caption “—Agreement and Plan of Merger with Confluence.”
Current wording
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
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
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 milestone payments associated with the license to Lilly (see “—Royalty Purchase Agreement with OCM IP Healthcare Portfolio LP” above).
Previous wording
We recognized $1.1 million and $1.3 million of licensing revenue related to the Lilly agreement during the three months ended June 30, 2026 and 2025, respectively, and $2.4 million and $2.3 million during the six months ended June 30, 2026 and 2025, respectively, all of which was payable to third parties.
Current wording
We recognized $1.1 million and $1.3 million of licensing revenue related to the Lilly agreement during the three months ended September 30, 2026 and 2025, respectively, and $3.5 million and $3.6 million during the nine months ended September 30, 2026 and 2025, respectively, all of which was payable to third parties.
Previous wording
Under the Confluence Agreement, we agreed to pay the former Confluence equity holders aggregate remaining contingent consideration of up to $75.0 million based upon the achievement of specified regulatory and commercial milestones set forth in the Confluence Agreement. In addition, we agreed to pay the former Confluence equity holders future royalty payments calculated as a low single-digit percentage of annual net sales, subject to specified reductions, limitations and other adjustments, until the date that all of the patent rights for that product have expired, as determined on a country-by-country and product-by-product basis or, in specified circumstances, ten years from the first commercial sale of such product. In addition to the payments described above, if we sell, license or transfer any of the intellectual property acquired from Confluence pursuant to the Confluence Agreement to a third party, we will be obligated to pay the former Confluence equity holders a portion of any consideration received from such sale, license or transfer in specified circumstances.
Current wording
Under the Confluence Agreement, we agreed to pay the former Confluence equity holders aggregate remaining contingent consideration of up to $75.0 million based upon the achievement of specified regulatory and commercial milestones set forth in the Confluence Agreement. In addition, we agreed to pay the former Confluence equity holders future royalty payments calculated as a low single-digit percentage of annual net sales, subject to specified reductions, limitations and other adjustments, until the date that all of the patent rights for that product have expired, as determined on a country-by-country and product-by-product basis or, in specified circumstances, ten years from the first commercial sale of such product. In addition to the payments described above, if we sell, license or transfer any of the intellectual property acquired from Confluence pursuant to the Confluence Agreement to a third party, we will be obligated to pay
Previous wording
Research and development activities are central to our business model. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. We expect to continue to incur research and development expenses in the near term as we continue the development of our product candidates and pursue our discovery programs. We expense research and development costs as incurred. Our direct research and development expenses primarily consist of external costs including fees paid to CROs, consultants, clinical trial sites, regulatory agencies and third parties that manufacture our preclinical and clinical trial materials and are tracked on a program-by-program basis. We do not allocate personnel costs or other indirect expenses to specific research and development programs.
Current wording
Research and development activities are central to our business model. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. We expect to continue to incur research and development expenses in the near term as we continue the development of our product candidates and pursue our discovery programs. We expense research and development costs as incurred. Our direct research and development expenses primarily consist of external costs including fees paid to CROs, consultants, clinical trial sites, regulatory agencies and
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, 2026. 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, 2026, the discount rate ranged between 7.5% and 9.5% 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, 2026. 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, 2026, the discount rate ranged between 7.8% and 10.5% depending on the year of each potential payment.
Previous wording
During the six months ended June 30, 2026, we recorded a charge to the contingent consideration liability of $0.3 million, which was primarily due to changes in estimated sales levels and the passage of time, partially offset by changes to market rates.
Current wording
During the nine months ended September 30, 2026, we recorded a gain to the contingent consideration liability of $0.3 million, which was primarily due to higher discount rates resulting from higher risk-free rates and changes in credit spreads.
Previous wording
Comparison of Three and Six Months Ended June 30, 2026 and 2025
Current wording
Comparison of Three and Nine Months Ended September 30, 2026 and 2025
Previous wording
The decrease in contract research revenue for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 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, 2026 compared to the three and nine months ended September 30, 2025 was driven by lower overall hours billed, which was partially offset by a higher average billing rate.
Previous wording
The increase in licensing revenue during the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was due to higher royalties earned under the Lilly and Sun Pharma license agreements.
Current wording
The decrease in licensing revenue during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to a sales milestone achieved under the Sun Pharma license agreement during the three and nine months ended September 30, 2025.
Previous wording
The decrease in cost of revenue for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 was driven by a decrease in personnel-related costs.
Current wording
The decrease in cost of revenue for the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was driven by a decrease in personnel-related costs.
Previous wording
The increase in expenses for bosakitug for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 was primarily due to an increase in clinical development expenses associated with a Phase 2 trial in atopic dermatitis, partially offset by lower product candidate manufacturing costs.
Current wording
The decrease in expenses for bosakitug for the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to lower product candidate manufacturing costs. The decrease in expenses for the nine month period was partially offset by higher clinical development expenses associated with a Phase 2 trial in atopic dermatitis.
Previous wording
The increase in expenses for ATI-052 for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 was primarily due to an increase in product candidate manufacturing costs and clinical development expenses associated with a Phase 1a program, as well as Phase 1b programs in atopic dermatitis and asthma, partially offset by a decrease in preclinical development expenses associated with toxicity studies.
Current wording
The increase in expenses for ATI-052 for the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to an increase in product candidate manufacturing costs and clinical development expenses associated with Phase 1b programs in atopic dermatitis and asthma.
Previous wording
with toxicity studies and clinical development expenses associated with a Phase 2a trial in atopic dermatitis, which was completed in July 2025, partially offset by an increase in product candidate manufacturing costs.
Current wording
The decrease in expenses for modzatinib during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to a decrease in preclinical development expenses associated with toxicity studies and clinical development expenses associated with a Phase 2a trial in atopic dermatitis, which was completed in July 2025, partially offset by an increase in clinical development expenses associated with a Phase 2b trial in lichen planus.
Previous wording
The increase in expenses for ATI-9494 during the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 was primarily due to an increase in product candidate manufacturing costs and preclinical development expenses associated with toxicity studies to support IND enabling studies.
Current wording
The increase in expenses for ATI-9494 during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to an increase in product candidate manufacturing costs and preclinical development expenses associated with toxicity studies to support IND enabling studies.
Previous wording
The increase in discovery expenses during the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 was primarily due to increased investment in JAK-sparing ITK inhibitors.
Current wording
The increase in discovery expenses during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to investment in JAK-sparing ITK inhibitors.
Previous wording
The increase in other research and development expenses during the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 was primarily due to an increase in consulting costs associated with our clinical programs.
Current wording
The decrease in other research and development expenses during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to the recognition of
Previous wording
The increase in personnel expenses during the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was primarily due to higher headcount. The decrease in stock-based compensation expense during the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 was due to the full amortization of awards granted in prior periods.
Current wording
The increase in personnel expenses during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to higher headcount. The decrease in stock-based compensation expense during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 was due to the full amortization of awards granted in prior periods.
Previous wording
The increase in professional and legal fees during the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 was primarily due to higher compliance and business development-related expenses during the three and six months ended June 30, 2026.
Current wording
The increase in professional and legal fees during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was primarily due to higher securities, compliance, and business development-related expenses during the three and nine months ended September 30, 2026.
Previous wording
The revaluation of contingent consideration loss decreased during the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 mainly due to changes to the probability of success for certain product candidates and lower discount rates being applied to potential payments during the three and six months ended June 30, 2025.
Current wording
contingent consideration during the nine months ended September 30, 2025 to a gain during the nine months ended September 30, 2026 was primarily due to changes to the probability of success for certain product candidates during the nine months ended September 30, 2025.
Previous wording
Interest income decreased during the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 due to a lower average investment balance and lower interest rates during the three and six months ended June 30, 2026.
Current wording
Interest income decreased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 due to a lower average investment balance and lower interest rates during the nine months ended September 30, 2026.
Previous wording
Non-cash royalty income was consistent during the three and six months ended June 30, 2026 and June 30, 2025 and includes income related to the proceeds from the sale of a portion of our OLUMIANT® royalty payments to OMERS in July 2024.
Current wording
Non-cash royalty income increased during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 due to higher income recognized related to the proceeds from the sale of a portion of our OLUMIANT® royalty payments to OMERS in July 2024.
Previous wording
As of June 30, 2026, we had cash, cash equivalents and marketable securities of $170.6 million. Cash in excess of immediate requirements is invested in accordance with our investment policy, primarily with a view towards liquidity and capital preservation. Subsequent to June 30, 2026, we raised aggregate gross proceeds of $40.2 million through our at-the-market facility.
Current wording
As of September 30, 2026, we had cash, cash equivalents and marketable securities of $204.6 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
In March 2026, we sold an aggregate of 18.4 million shares of our common stock for gross proceeds of $59.8 million, pursuant to an amended and restated sales agreement with Leerink Partners LLC and Cantor Fitzgerald & Co., as
Current wording
In March 2026, we sold an aggregate of 18.4 million shares of our common stock for gross proceeds of $59.8 million, pursuant to an amended and restated sales agreement with Leerink Partners LLC and Cantor Fitzgerald & Co., as sales agents, dated February 27, 2025. We paid selling commissions and other fees of $1.8 million in connection with the sales.
Previous wording
Cash and cash equivalents were $19.2 million as of June 30, 2026 compared to $20.0 million as of December 31, 2025. We also had $151.5 million in short- and long-term marketable securities as of June 30, 2026 compared to $131.4 million as of December 31, 2025.
Current wording
Cash and cash equivalents were $20.4 million as of September 30, 2026 compared to $20.0 million as of December 31, 2025. We also had $184.2 million in short- and long-term marketable securities as of September 30, 2026 compared to $131.4 million as of December 31, 2025.
Previous wording
Net cash used in operating activities increased for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily as a result of higher net losses after adjusting for non-cash items during the six months ended June 30, 2026, as well as an increase 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, 2026 compared to the nine months ended September 30, 2025 primarily as a result of higher net losses after adjusting for non-cash items during the nine months ended September 30, 2026, as well as a decrease in cash received for accounts receivable, prepaid expenses and other assets, primarily from the receipt of a third-party milestone payment which was payable to third parties during the nine months ended September 30, 2025.
Previous wording
The change in net cash used in investing activities for the six months ended June 30, 2026 compared to the net cash provided by investing activities for the six months ended June 30, 2025 resulted primarily from greater purchases of
Current wording
The change in net cash used in investing activities for the nine months ended September 30, 2026 compared to the net cash provided by investing activities for the nine months ended September 30, 2025 resulted primarily from greater purchases of marketable securities and lower proceeds from sales and maturities of marketable securities during the nine months ended September 30, 2026.
Previous wording
The change in net cash provided by financing activities for the six months ended June 30, 2026 compared to net cash used in financing activities for the six months ended June 30, 2025 was primarily due to proceeds from sales under our at-the-market sales agreement in March 2026.
Current wording
The change in net cash provided by financing activities for the nine months ended September 30, 2026 compared to net cash used in financing activities for the nine months ended September 30, 2025 was primarily due to proceeds from sales under our at-the-market sales agreement during the nine months ended September 30, 2026.
Showing the first 40 of 43 pairs. Open the source sections for the rest.
Rearranged current paragraphs (7)
Current report — wording carried from elsewhere
We are also exploring the potential of modzatinib in additional indications that are relevant to the dual pharmacology and mechanism of action, including other inflammatory disorders.
Current report — wording carried from elsewhere
In November 2024, we entered into an exclusive license agreement (the “Biosion Agreement”) with Biosion pursuant to which we received the exclusive rights to develop, manufacture and commercialize bosakitug and ATI-052
Current report — wording carried from elsewhere
In November 2022, we entered into a license agreement with Pediatrix under which we granted Pediatrix the
Current report — wording carried from elsewhere
the former Confluence equity holders a portion of any consideration received from such sale, license or transfer in specified circumstances.
Current report — wording carried from elsewhere
third parties that manufacture our preclinical and clinical trial materials and are tracked on a program-by-program basis. We do not allocate personnel costs or other indirect expenses to specific research and development programs.
Current report — wording carried from elsewhere
reimbursements related to previously incurred clinical trial costs, partially offset by an increase in consulting costs associated with our clinical programs.
Current report — wording carried from elsewhere
The increase in personnel expenses during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 was primarily due to higher headcount. The increase in stock-based compensation expense during the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 was due to higher headcount, partially offset by the full amortization of awards granted in prior periods.
Rearranged previous paragraphs (8)
Previous report — wording carried elsewhere
pathways associated with ITK, including strong downregulation of Th2, Th17, and TCR pathways, along with the Th1 pathway and fibrosis-related markers.
Previous report — wording carried elsewhere
(excluding Greater China). In 2022, we granted Pediatrix Therapeutics, Inc. (“Pediatrix”) exclusive rights to develop and commercialize lepzacitinib in Greater China.
Previous report — wording carried elsewhere
sublicense or similar rights under any of the rights or licenses granted to us under the Biosion Agreement. We will expense these payments in the period when either they are determined to be probable of occurring or when the payment is triggered.
Previous report — wording carried elsewhere
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 milestone payments associated with the license to Lilly (see “—Royalty Purchase Agreement with OCM IP Healthcare Portfolio LP” above).
Previous report — wording carried elsewhere
The decrease in expenses for modzatinib during the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 was primarily due to a decrease in preclinical development expenses associated
Previous report — wording carried elsewhere
The increase in personnel expenses during the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 was primarily due to higher headcount.
Previous report — wording carried elsewhere
sales agents, dated February 27, 2025. We paid selling commissions and other fees of $1.8 million in connection with the sales.
Previous report — wording carried elsewhere
marketable securities and lower proceeds from sales and maturities of marketable securities during the six months ended June 30, 2026.