Damora Therapeutics, Inc.
For the period ended Dec 31, 2025. Filed Mar 19, 2026.
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FY2025 · Filed Mar 19, 2026
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Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of Damora Therapeutics, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Damora Therapeutics, Inc. (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, changes in stockholders’ equity and cash flows for each of the two years in the period ended December 31, 2025, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
| Acquired option obligation | |
| Description of the Matter | As disclosed in Notes 1, 3, 4 and 13 of the consolidated financial statements, on November 10, 2025, the Company (formerly known as Galecto, Inc.) acquired Damora Therapeutics, Inc. The total fair value of consideration transferred was $152.7 million. The transaction was accounted for as an asset acquisition under ASC 805-50. Substantially all of the fair value of the gross assets acquired was concentrated in a single identifiable asset, consisting of rights to license in-process research and development with no alternative future use. In connection with the asset acquisition, the Company recognized an option obligation liability of $3.7 million related to a service provider’s contractual right to receive future warrant grants. Auditing the Company’s accounting for the asset acquisition was complex due to the estimation uncertainty in determining the fair value of the option obligation liability. The Company used an option pricing model to measure the acquired option obligation. The fair value determination of the option obligation liability required management to make estimates and significant assumptions regarding the expected term of the warrants and volatility of the underlying shares. |
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| How We Addressed the Matter in Our Audit | To test the value of the option obligation liability, our procedures included, among others, reading the relevant agreements related to the asset acquisition and research services to understand the terms and conditions of the option. We assessed the reasonableness of management’s significant assumptions and evaluated the completeness and accuracy of the data used in supporting the assumptions, including the actual historical volatility of the underlying shares and related adjustments. With the assistance of our internal valuation specialists, we evaluated the reasonableness of the methodology assumptions applied by the Company, including in the determination of the expected term and volatility. We also assessed the appropriateness of the related disclosures included in the consolidated financial statements. |
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/s/EY Godkendt Revisionspartnerselskab
We have served as the Company’s auditor since 2019.
Copenhagen, Denmark
March 19, 2026
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