Quince Therapeutics, Inc.

Previous wording

Our research and development expenses consist of expenses incurred in connection with the research and development of our research programs. These expenses include payroll and personnel expenses, including stock-based compensation, for our research and product development employees, laboratory supplies, product licenses, consulting costs, contract research, regulatory, quality assurance, preclinical and clinical expenses, allocated rent, facilities costs and depreciation. We expense both internal and external research and development costs as they are incurred. Non-refundable advance payments and deposits for services that will be used or rendered for future research and development activities are recorded as prepaid expenses and recognized as an expense as the related services are performed.

Current wording

Our research and development expenses consist of expenses incurred in connection with the research and development of our research programs. These expenses include payroll and personnel expenses, including stock-based compensation, for our research and product development employees, laboratory supplies, product licenses, consulting costs, contract research, regulatory, quality assurance, preclinical and clinical expenses, allocated rent, facilities costs and depreciation. We expense both internal and external research and development costs as they are incurred. Non-refundable advance payments and deposits for services that would be used or rendered for future research and development activities are recorded as prepaid expenses and recognized as an expense as the related services are performed.

Previous wording

For a description of our significant accounting policies, see Note 2 to our condensed consolidated financial statements.

Current wording

For a description of our significant accounting policies, see Note 2 to our unaudited condensed consolidated financial statements.

Previous wording

Research and development expenses were $8.1 million for the three months ended September 30, 2025, compared to $4.9 million for the three months ended September 30, 2024, an increase of $3.2 million.

Current wording

Research and development expenses were $6.8 million for the three months ended March 31, 2026, compared to $8.1 million for the three months ended March 31, 2025, a decrease of $1.3 million.

Previous wording

The costs for eDSP development increased by $3.0 million compared to the same period from the prior year due to the continuation costs related to our Phase 3 NEAT clinical trial and OLE. This increase was primarily due to an increase of clinical trial costs of $3.0 million), an increase of eDSP consulting spend of $0.3 million, and a decrease in manufacturing costs of $0.3 million.

Current wording

The costs for eDSP development decreased by $2.3 million compared to the same period from the prior year due to the ramping down related to our Phase 3 NEAT clinical trial and OLE as well as a gain on the settlement of accounts payable. This decrease was primarily due to a gain on settlement of accounts payable of $2.6 million, of which $2.4 million related to eDSP, as well as a decrease in clinical trial costs of $1.8 million, a decrease in eDSP consulting of $0.4 million, and a decrease in manufacturing costs of $0.3 million, offset by an increase of R&D expenses of $2.4 million related to the reserve and adjustment for R&D tax credits and $0.2 million of other R&D expenses.

Previous wording

Our personnel related costs increased by $1.9 million during the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024, mainly as a result of an increase of $0.8 million in allocated stock-based compensation costs and a $1.1 million increase in other personnel related expenses, including payroll taxes and benefits.

Current wording

Our personnel related costs increased by $0.7 million during the three months ended March 31, 2026 as compared to the three months ended March 31, 2025, mainly as a result of an increase of $0.1 million in allocated stock-based compensation costs and a $0.6 million increase in other personnel related expenses, including severance costs related to personnel separation.

Previous wording

Facilities and other research and development expenses decreased by $0.2 million for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024 primarily due to a decrease in rent, storage and facilities expenses.

Current wording

Facilities and other research and development expenses decreased by $23 thousand for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025 primarily due to a decrease in rent, storage and facilities expenses.

Previous wording

General and administrative expenses decreased by $1.9 million to $11.4 million for the nine months ended September 30, 2025, from $13.3 million for the nine months ended September 30, 2024. The decrease in general and administrative expenses is primarily due to decreases of $0.8 million in allocated stock-based compensation and personnel related expenses, $0.5 million in consulting and professional costs and $0.6 million decrease in other professional and administrative expenses year over year.

Current wording

General and administrative expenses decreased by $0.5 million to $4.3 million for the three months ended March 31, 2026, from $4.8 million for the three months ended March 31, 2025. The decrease in general and administrative expenses is primarily due to $0.6 million in allocated stock-based compensation and personnel related expenses, offset by an increase of $0.1 million in consulting and professional costs related to the restructuring activities.

Previous wording

For the three months ended September 30, 2025, we recorded a fair value adjustment for warrants which resulted in a $0.3 million charge primarily due to the change in the price of our common stock.

Current wording

For the three months ended March 31, 2026, we recorded a $31.1 million fair value adjustment for warrants primarily due to timing of issuance of the warrants and change in the price of our common stock.

Previous wording

Interest income decreased by $0.4 million for the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. The change was due to decreased yields on our investment portfolio and decreased average balances.

Current wording

Interest income decreased by $0.2 million for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The change was due to decreased yields on our investment portfolio and decreased average balances.

Previous wording

Other income (expense), net decreased by $16 thousand for the nine months ended September 30, 2025 primarily due to unrealized gains resulting from changes in foreign exchange rates.

Current wording

Other income (expense), net increased by $1.8 million for the three months ended March 31, 2026 primarily due to unrealized gains from foreign currency translation.

Previous wording

We recorded tax benefit of $46 thousand for the three months ended September 30, 2025 and tax expense of $13 thousand for the three months ended September 30, 2024. Tax benefit is primarily due to the true-up of the Australian tax in the three months ended September 30, 2025.

Current wording

We recorded $5.3 million of tax benefit for the three months ended March 31, 2026 and tax expense of $47 thousand for the three months ended March 31, 2025. Tax benefit is primarily driven by the release of unrecognized tax benefit related to the 2025 intercompany sale of intellectual property.

Previous wording

We have not generated any revenue and we have never been profitable. To date, we have financed our operations primarily through the issuance and sale of our securities. From inception through September 30, 2025, we received net proceeds of approximately $320.1 million from the issuance of redeemable convertible preferred stock, convertible promissory notes, common warrants, pre-funded warrants, and common stock.

Current wording

We have not generated any revenue and we have never been profitable. To date, we have financed our operations primarily through the issuance and sale of our securities. From inception through March 31, 2026, we received net proceeds of approximately $337.1 million from the issuance of redeemable convertible preferred stock, convertible promissory notes, common warrants, pre-funded warrants, and common stock.

Previous wording

We have incurred net losses since the commencement of our operations. As of September 30, 2025, we had an accumulated deficit of $421.0 million. We incurred a net loss of $13.4 million and $44.5 million in the three and nine months ended September 30, 2025, respectively. We do not expect to generate product revenue unless and until we obtain marketing approval for and commercialize a drug candidate, and we cannot assure you that we will ever generate significant revenue or profits.

Current wording

We have incurred net losses from operations since our inception. As of March 31, 2026, we had an accumulated deficit of $424.5 million. While we generated a net income of $35.9 million in the three months ended March 31, 2026, we do not expect to generate revenue unless and until we complete a reverse merger or other strategic transaction and the post-transaction company generates revenue, and we cannot assure you that a transaction will be completed or that the combined company will ever generate significant revenue or profits.

Previous wording

We evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern within one year after the date that the unaudited condensed consolidated financial statements are issued. We have incurred losses and generated negative operating cash flows since our inception and anticipate that we will continue to incur losses for at least the next several years. The transition to profitability is dependent upon the successful development, approval and commercialization of our product candidate, and the achievement of a level of revenues adequate to support our cost structure. As of September 30, 2025, we had cash, cash equivalents and short-term investments of $26.3 million. Based on our current operating plan, we believe that our cash and cash equivalents balance as of September 30, 2025 will not be sufficient to fund operations and capital expenditures for the twelve months following the filing of this Quarterly Report on Form 10-Q, and we will need to obtain additional funding. We intend to obtain additional funding through available financing sources which may include additional public offerings of common stock, private financing of debt or equity, and/or the pursuit of strategic partnerships, licensing arrangements or collaborations. Management’s belief with respect to our ability to fund operations is based on estimates that are subject to risks and uncertainties. If actual results are different from management’s estimates, we may need to seek additional funding sooner than would otherwise be expected. There can be no assurance that we will be able to obtain additional funding on acceptable terms, if at all. If we are unable to obtain sufficient funding, we may be required to delay development efforts, limit activities and reduce research and development costs, which could adversely affect our business prospects. Because of the uncertainty in securing additional funding and the insufficient amount of cash and cash equivalent resources as of September 30, 2025, we concluded that substantial doubt exists with respect to our ability to continue as a going concern within one year after the date that these unaudited condensed consolidated financial statements are issued.

Current wording

We evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern within one year after the date that the unaudited condensed consolidated financial statements are issued. We have incurred losses and generated negative operating cash flows since our inception and anticipate that we will continue to incur losses for at least the next several years. In January 2026, we ceased clinical development of eDSP as the primary and secondary endpoints did not achieve statistical significance in our Phase 3 NEAT clinical trial. As of March 31, 2026, we had cash and cash equivalents of $18.2 million. Based on our current operating plan, we believe that our cash and cash equivalents balance as of the date of this filing will not be sufficient to fund operations and capital expenditures for the twelve months following the filing of this Quarterly Report on Form 10-Q, and we will need to obtain additional funding. We intend to obtain additional funding through available financing sources which may include additional public offerings of common stock, including sales of common stock, under a Controlled Equity Offering SM Sales Agreement, dated December 18, 2024, with Cantor Fitzgerald & Co. and H.C. Wainwright & Co., LLC, and/or private financing of debt or equity. Management’s belief with respect to our ability to fund operations is based on estimates that are subject to risks and uncertainties. If actual results are different from management’s estimates, we may need to seek additional funding sooner than would otherwise be expected. There can be no assurance that we will be able to obtain additional funding on acceptable terms, if at all. Because of the uncertainty in securing additional funding and the insufficient amount of cash and cash equivalent resources, we concluded that substantial doubt exists with respect to our ability to continue as a going concern within one year after the date that these consolidated financial statements are issued.

Previous wording

Our cash, cash equivalents, and marketable debt securities are held in a variety of deposit accounts, interest-bearing accounts, U.S government securities, debt securities in government-sponsored entities, and money market funds. Cash in excess of immediate requirements is invested with a view toward liquidity and capital preservation, and we seek to minimize the potential effects of concentration and credit risk. Our cash equivalents and short-term investments are held in money market funds and government agency obligations.

Current wording

Our cash, cash equivalents, and marketable debt securities are held in a variety of deposit accounts, interest-bearing accounts, U.S government securities, debt securities in government-sponsored entities, and money market funds. Cash in excess of immediate requirements, if any, is invested with a view toward liquidity and capital preservation, and we seek to minimize the potential effects of concentration and credit risk. Our cash equivalents and short-term investments are held in money market funds and government agency obligations.

Previous wording

If we raise additional funds by issuing equity securities, our stockholders will experience dilution. Any future debt financing into which we enter may impose upon us additional covenants that restrict our operations, including limitations on our ability to incur liens or additional debt, pay dividends, repurchase our common stock, make certain investments and engage in certain merger, consolidation or asset sale transactions. Any debt financing or additional equity that we raise may contain terms that are not favorable to us or our stockholders. If we are unable to raise additional funds when needed, we may be required to delay, reduce, or terminate some or all of our development programs and clinical trials. We may also be required to sell or license to others rights to our drug candidates in certain territories or indications that we would prefer to develop and commercialize ourselves.

Current wording

If we raise additional funds by issuing equity securities, our stockholders will experience dilution. Any future debt financing into which we enter may impose upon us additional covenants that restrict our operations, including limitations on our ability to incur liens or additional debt, pay dividends, repurchase our common stock, make certain investments and engage in certain merger, consolidation or asset sale transactions. Any debt financing or additional equity that we raise may contain terms that are not favorable to us or our stockholders. While we have engaged a financial advisor to support our board of directors in exploring strategic transactions, there can be no assurance that we will be able to engage in a strategic alternative transaction, including a reverse merger, or even if we do so, that any such transaction will result in favorable terms and conditions for us or our stockholders. If we are unable to execute a strategic transaction, may be required to pursue a reorganization proceeding under applicable bankruptcy or insolvency laws, including under Chapters 7 or 11 of the U.S. Bankruptcy Code.

Previous wording

On December 18, 2024, we entered into a Controlled Equity Offering SM Sales Agreement, with Cantor Fitzgerald & Co. and H.C. Wainwright & Co., LLC, or the Agents, relating to the sale of shares of our common stock, par value $0.001 per share. In accordance with the terms of this agreement, we may offer and sell up to $21.9 million of shares of common stock.

Current wording

On December 18, 2024, we entered into a Controlled Equity Offering SM Sales Agreement, with Cantor Fitzgerald & Co. and H.C. Wainwright & Co., LLC, or the Agents, relating to the sale of shares of our common stock, par value $0.001 per share. In accordance with the terms of this agreement, we may offer and sell up to $21.9 million of shares of common stock. In October 2025, we increased the total amount available under the ATM program to $75.0 million.

Previous wording

During the three and nine months ended September 30, 2025, we utilized our ATM program to raise net proceeds of approximately $1.4 million and $4.3 million by issuing 870,785 shares and 3,637,334 shares of common stock, respectively. As of September 30, 2025, $17.5 million remained available to be sold under the ATM program. In October 2025, we increased the total amount available under the ATM program to $75.0 million and utilized our ATM program to raise net proceeds of approximately $2.0 million by issuing 1,186,525 shares of common stock.

Current wording

During the three months ended March 31, 2026, we utilized our ATM program to raise net proceeds of approximately $15.0 million by issuing 8,018,500 shares of common stock. As of March 31, 2026, $53.1 million remained available to be sold under the ATM program.

Previous wording

On June 12, 2025, we entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”), with certain institutional investors (the “Investors”) and certain members of our management (together with the Investors, the “Purchasers”) pursuant to which we issued and sold to the Purchasers in a private placement (the “Private Placement”): (i) 6,671,928 shares (the “Shares”) of our common stock, par value $0.001 per share (the “Common Stock”), (ii) pre-funded warrants (the “Pre-Funded Warrants”) to purchase up to an aggregate of 2,000,000 shares of Common Stock, and (iii) accompanying warrants to purchase up to an aggregate of 8,671,928 shares of Common Stock (the “Common Warrants”), for aggregate gross proceeds of approximately $11.5 million (excluding up to approximately $10.4 million of aggregate gross proceeds that may be received in the future upon the cash exercise in full of the Common Warrants issued in the Private Placement), before deducting placement agent fees and other expenses payable by us. Each Share and each Pre-Funded Warrant sold pursuant to the Securities Purchase Agreement was accompanied by one Common Warrant. The combined purchase price of each Share and accompanying Common Warrant was $1.325 (which included $0.125 per Common Warrant in accordance with the rules and regulations of Nasdaq). The combined purchase price of each Pre-Funded Warrant and accompanying Common Warrant was $1.324 (equal to the combined purchase price per Share and accompanying Common Warrant, minus $0.001).

Current wording

On June 12, 2025, we entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”), with certain institutional investors (the “Investors”) and certain members of our management (together with the Investors, the “Purchasers”) pursuant to which we issued and sold to the Purchasers in a private placement (the “Private Placement”): (i) 667,193 shares (the “Shares”) of our common stock, par value $0.001 per share, as adjusted for the Reverse Stock Split (ii) pre-funded warrants (the “Pre-Funded Warrants”) to purchase up to an aggregate of 200,000 shares of common stock, as adjusted for the Reverse Stock Split, and (iii) accompanying warrants to purchase up to an aggregate of 867,193 shares of common stock (the “Common Warrants”), as adjusted for the Reverse Stock Split, for aggregate gross proceeds of approximately $11.5 million (excluding up to approximately $10.4 million of aggregate gross proceeds that may be received in the future upon the cash exercise in full of the Common Warrants issued in the Private Placement), before deducting placement agent fees and other expenses payable by us. Each Share and each Pre-Funded Warrant sold pursuant to the Securities Purchase Agreement was accompanied by one Common Warrant. The combined purchase price of each Share and accompanying Common Warrant was $13.25 (which included $1.25 per Common Warrant in accordance with the rules and regulations of Nasdaq). The combined purchase price of each Pre-Funded Warrant and accompanying Common Warrant was $13.24 (equal to the combined purchase price per Share and accompanying Common Warrant, minus $0.01).

Previous wording

In connection with the acquisition of EryDel on October 20, 2023, we guaranteed the EIB Loan. The EIB Loan was amended and restated as of the acquisition date. The EIB Loan provides for maximum borrowings of 30.0 million euro through four tranches; tranche A, 3.0 million euro; tranche B, 7.0 million euro; tranche C, 10.0 million euro; and tranche D, 10.0 million euro. Each tranche is subject to conditions precedent related to our business and capitalization. As of September 30, 2025, only tranches A and B have been drawn. All amounts due under tranche A and B are payable on their maturity date of August 2026. Tranche C and D are payable in equal installments of principal together with all amounts outstanding under the tranches on the repayment dates specified in the relevant disbursement offer. The first repayment date of tranche C shall fall not earlier than twelve months from the disbursement date of such tranche. The last repayment date of tranche C and tranche D shall fall not later than 5 years from the disbursement date of tranche C and tranche D, respectively. The EIB Loan bears interest at fixed rates for each tranche and both principal and interest are payable on the maturity date for each tranche (with the exception of 2% cash interest which shall accrue and be payable quarterly during fiscal year 2025 pursuant to the terms of the Amendment, which shall correspondingly reduce the deferred interest rate accruing during such period). The fixed rates range from 7.0% to 9.0% per annum. As of September 30, 2025, principal of 10.0 million euros ($11.7 million) was outstanding on the EIB Loan and classified as current portion of debt on the condensed consolidated balance sheet at fair value with imputed interest of 9.0% included.

Current wording

In connection with the acquisition of EryDel on October 20, 2023, we guaranteed the EIB Loan. The EIB Loan was amended and restated as of the acquisition date. The EIB Loan provides for maximum borrowings of 30.0 million euro through four tranches; tranche A, 3.0 million euro; tranche B, 7.0 million euro; tranche C, 10.0 million euro; and tranche D, 10.0 million euro. Each tranche is subject to conditions precedent related to our business and capitalization. Only tranches A and B were drawn. All amounts under tranche A and B were payable on their maturity date of August 2026. Interest accrued at fixed rates for each tranche and both principal and interest was payable on the maturity date for each tranche (with the exception of 2% cash interest which was accrued and payable quarterly during fiscal year 2025 pursuant to the terms of the Amendment (as defined below), which correspondingly reduced the deferred interest rate accruing during such period). The fixed rates ranged from 7.0% to 9.0% per annum.

Previous wording

Net cash used in operating activities increased by $6.6 million during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily due to higher operating payments driven by increased clinical development activities. Net cash used in operating activities was $30.9 million for the nine months ended September 30, 2025. Cash used in operating activities was primarily due to our net loss of $44.5 million for the period, adjusted for $13.2 million of non-cash items, including $4.2 million change in the fair value of warrants, $3.9 million in stock-based compensation, $4.5 million change in the fair value of contingent consideration liabilities, $1.3 million change in the fair value of the EIB Loan, and a net increase in our operating assets of $0.3 million and a net increase in our accounts payable, and accrued expenses and other current liabilities of $0.7 million.

Current wording

Net cash used in operating activities decreased by $2.0 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily due to lower operating payments driven by decreased clinical development activities. Net cash used in operating activities was $7.6 million for the three months ended March 31, 2026. Cash used in operating activities was primarily due to our net income of $35.9 million for the period, adjusted for $41.2 million of non-cash items, including $31.1 million change in the fair value of warrants, $1.3 million in stock-based compensation, $64.3 million change in the fair value of contingent consideration liabilities, $12.2 million change in the fair value of the EIB Loan, $2.6 million in gain on settlement of accounts payable, $67.8 million non-cash impairment on intangible assets, and a net increase in our operating assets of $1.8 million and a net increase in our accounts payable, and accrued expenses and other current liabilities of $0.6 million.

Previous wording

Cash provided by investing activities was $15.2 million for the nine months ended September 30, 2025, primarily related to the proceeds from maturities of short-term investments of $45.0 million, and the purchase of investments of $29.5 million.

Current wording

Cash provided by investing activities was $12.0 million for the three months ended March 31, 2026, primarily related to the proceeds from maturities of short-term investments.

Previous wording

Cash provided by investing activities was $11.0 million for the nine months ended September 30, 2024, primarily related to the maturities of short-term investments of $100.7 million, and the purchase of investments of $89.6 million.

Current wording

Cash provided by investing activities was $10.9 million for the three months ended March 31, 2025, primarily related to the maturities of short-term investments of $13.0 million, and the purchase of investments of $2.0 million.

Previous wording

Cash provided by financing activities was $15.9 million for the nine months ended September 30, 2025, which consisted of gross proceeds of $11.4 million from the issuance of common stock, common warrants, and pre-funded warrants in connection with June 2025 Private Placement, $4.3 million from the issuance of common stock in connection with the ATM offerings, and $0.2 million from the exercise of stock options in the period.

Current wording

Cash provided by financing activities was $9.4 million for the three months ended March 31, 2026, which consisted of $15.0 million from the issuance of common stock in connection with the ATM offerings and the repayment of debt of $5.5 million.

Previous wording

Cash used in financing activities was $4.8 million for the nine months ended September 30, 2024, which consisted of a cash milestone payment of $5.0 million, partially offset by proceeds of $0.2 million from the exercise of stock options in the period.

Current wording

Cash used in financing activities was $0.1 million for the three months ended March 31, 2025, which consisted of net proceeds from the exercise of stock options in the period.

Previous wording

We enter into contracts in the normal course of business with third party contract organizations for clinical trials, non-clinical studies and testing, manufacturing, and other services and products for operating purposes. The amount and timing of the payments under these contracts varies based upon the timing of the services. We have recorded accrued expense of approximately $5.1 million in our condensed consolidated balance sheet for expenditures incurred by these vendors as of September 30, 2025. We have approximately $22.9 million in cancellable future operating expense commitments based on existing contracts as of September 30, 2025. These obligations will be satisfied in the normal course of business, but generally no longer than 12 months. As of September 30, 2025, the fair value of the EIB Loan is $17.5 million and classified as current portion of debt on the condensed consolidated balance sheet at fair value. As of September 30, 2025 the fair value of long-term contingent consideration on our books for the earnout related to the EryDel Acquisition is $61.2 million, and the fair value of warrants issued in connection with the private placement is $14.9 million, refer to Note 3 to the condensed consolidated financial statements for further details.

Current wording

We enter into contracts in the normal course of business with third party contract organizations for clinical trials, non-clinical studies and testing, manufacturing, and other services and products for operating purposes. The amount and timing of the payments under these contracts varies based upon the timing of the services. We have recorded accrued expense of approximately $3.4 million in our condensed consolidated balance sheet for expenditures incurred by these vendors as of March 31, 2026. Our cancellable future operating expense commitments based on existing contracts as of March 31, 2026 is immaterial. These obligations will be satisfied in the normal course of business, but generally no longer than 12 months. In March 2026, we entered into a Settlement Agreement with the EIB to settle our outstanding obligations in full with a single payment of 4.8 million euros ($5.5 million). Following such payment, all of our obligations to the EIB were satisfied and discharged. Additionally, in March 2026, it was determined that the criteria for the contingent consideration payouts will not be met, resulting in the related liability being reduced to zero. As of March 31, 2026, the fair value of warrants issued in connection with the private placement is $0.7 million.