AGIOS PHARMACEUTICALS, INC.

Note 1. Nature of Business

Note Regarding Certain References in this Annual Report on Form 10-K

Throughout this Annual Report on Form 10-K, “Agios,” “the Company,” “we,” “us,” and “our,” and similar expressions, except where the context requires otherwise, refer to Agios Pharmaceuticals, Inc. and its consolidated subsidiaries, and “our Board of Directors” refers to the board of directors of Agios Pharmaceuticals, Inc.

In addition, unless otherwise stated or the context indicates otherwise, all references in this Annual Report on Form 10-K to “AQVESME™ (mitapivat)” or “AQVESME™” refer to our FDA-approved medicine for the treatment of anemia in adults with non-transfusion dependent and transfusion-dependent alpha- or beta-thalassemia in the United States; references to “PYRUKYND® (mitapivat)”, “PYRUKYND®”, or “mitapivat” refer to all other commercially available mitapivat products or mitapivat product candidates for which we are exploring further applications and indications, as the context requires.

Overview

We are a commercial-stage biopharmaceutical company dedicated to redefining the future of rare disease treatment. Fueled by connections, we build trusted partnerships with communities, collaborating to develop and deliver innovative medicines with the potential to transform lives. With a foundation in hematology, we combine biological expertise with real-world insights to advance a growing pipeline of rare disease medicines that reflect the priorities of the people we serve. We are located in Cambridge, Massachusetts.

The lead product candidate in our portfolio, mitapivat, is an activator of both wild-type and mutant pyruvate kinase, or PK, enzymes for the potential treatment of hemolytic anemias. Mitapivat is approved in the United States by the U.S. Food and Drug Administration, or FDA, under the brand name AQVESME™ for the treatment of anemia in adults with non-transfusion dependent and transfusion-dependent alpha- or beta-thalassemia and in Saudi Arabia under the brand name PYRUKYND® for the treatment of adult patients with non-transfusion-dependent and transfusion-dependent alpha- or beta-thalassemia. Mitapivat is also approved under the brand name PYRUKYND® in the United States by the FDA for the treatment of hemolytic anemia in adults with PK deficiency and in the European Union, or EU, and Great Britain for the treatment of PK deficiency in adults.

In December 2024, we announced that we submitted a marketing authorization application, or MAA, to the European Medicines Agency, or EMA, and a regulatory application to the United Arab Emirates health authorities for PYRUKYND® for the treatment of adult patients with non-transfusion dependent and transfusion-dependent alpha- or beta-thalassemia. In October 2025, we announced that the Committee for Medicinal Products for Human Use, or the CHMP, of the EMA adopted a positive opinion for the new indication for PYRUKYND® in adults for the treatment of anemia associated with transfusion-dependent and non-transfusion-dependent alpha- or beta-thalassemia. The European Commission is reviewing the CHMP’s opinion, with the final decision expected in early 2026.

We will have a pre-supplemental New Drug Application, or sNDA, meeting with the FDA in the first quarter of 2026 and intend to submit a U.S. marketing application for mitapivat in sickle cell disease, or SCD, following that engagement.

In addition, we are evaluating mitapivat for the treatment of pediatric patients with PK deficiency. We are also developing (i) tebapivat, a novel PK activator, for the potential treatment of lower-risk myelodysplastic syndromes, or LR MDS, and SCD; (ii) AG-181, our phenylalanine hydroxylase, or PAH, stabilizer for the potential treatment of phenylketonuria, or PKU; and (iii) AG-236, an siRNA in-licensed from Alnylam Pharmaceuticals, Inc., or Alnylam, targeting the transmembrane serine protease 6, or TMPRSS6, gene for the potential treatment of polycythemia vera, or PV.

We are subject to risks common to companies in our industry including, but not limited to, uncertainties relating to conducting preclinical and clinical research and development, the manufacture and supply of products for clinical and commercial use, obtaining and maintaining regulatory approvals and pricing and reimbursement for our products, market acceptance, managing global growth and operating expenses, availability of additional capital, competition, obtaining and enforcing patents, stock price volatility, dependence on collaborative relationships and third-party service providers, dependence on key personnel, potential litigation, potential product liability claims and potential government investigations.

On July 28, 2023, we entered into a license agreement with Alnylam under which we acquired the rights to develop and commercialize Alnylam’s novel preclinical siRNA targeting the TMPRSS6 gene, which we refer to as AG-236, as a potential disease-modifying treatment for patients with PV.

In accordance with the license agreement, in the year ended December 31, 2023, we made an up-front payment to Alnylam and recognized in-process research and development of $17.5 million which was recorded in research and development expense within our consolidated statements of operations and classified as investing activities within our consolidated statements of cash flows. We will also pay Alnylam for certain expenses associated with the development of AG-236, and these will be recorded in our consolidated statements of operations as incurred. Additionally, we are responsible to pay up to $130.0 million in potential development and regulatory milestones, in addition to sales milestones as well as tiered royalties on annual net sales, if any, of licensed products, which may be subject to specified reductions and offsets. In the year ended December 31, 2025, we achieved a regulatory milestone that triggered a $10.0 million payment to Alnylam, which was recorded in research and development expense within our consolidated statements of operations and classified as investing activities within our consolidated statements of cash flows.

Sale of Oncology Business to Servier and Sale of Contingent Payments

On March 31, 2021, we completed the sale of our oncology business to Servier Pharmaceuticals, LLC, or Servier. The transaction included the sale of our entire oncology business, including our clinical-stage product candidate vorasidenib, for a payment of approximately $1.8 billion in cash at the closing, subject to certain adjustments, and a payment of $200.0 million in cash, if, prior to January 1, 2027, vorasidenib is granted new drug application, or NDA, approval from the FDA with an approved label that permits vorasidenib’s use as a single agent for the adjuvant treatment of patients with Grade 2 glioma that have an isocitrate dehydrogenase, or IDH, 1 or 2 mutation (and, to the extent required by such approval, the vorasidenib companion diagnostic test is granted an FDA premarket approval), or the Vorasidenib Milestone Payment, and a royalty of 15% of U.S. net sales of vorasidenib from the first commercial sale of vorasidenib through loss of exclusivity, or the Vorasidenib Royalty Rights. The Vorasidenib Milestone Payment and Vorasidenib Royalty Rights are referred to as contingent payments and recognized as income when realizable.

In August 2024, the FDA approved vorasidenib for adult and pediatric patients 12 years and older with Grade 2 astrocytoma or oligodendroglioma with a susceptible IDH1 or IDH2 mutation, following surgery including biopsy, sub-total resection, or gross total resection. In September 2024, we received the Vorasidenib Milestone Payment from Servier and recognized income of $200.0 million within the milestone payment from gain on sale of oncology business line item in our consolidated statements of operations for the year ended December 31, 2024. In May 2024, we entered into a purchase and sale agreement to sell the Vorasidenib Royalty Rights to Royalty Pharma Investments 2019 ICAV, or Royalty Pharma, for $905.0 million in cash, or the Upfront Payment. The sale was contingent upon FDA approval of vorasidenib and other customary closing conditions.

Upon consummation of the sale in August 2024, Royalty Pharma acquired 100% of the Vorasidenib Royalty Rights payments made by Servier on account of up to $1.0 billion in U.S. net sales for each calendar year. In addition, any such Vorasidenib Royalty Rights payments made by Servier on account of U.S. net sales in each calendar year in excess of $1.0 billion will be split, with Royalty Pharma having the rights to a 12% earn-out on those excess payments and Agios retaining the rights to a 3% earn-out on those excess payments, or the Retained Earn-Out Rights. As a result of the sale, we recognized income of $889.1 million ($905.0 million net of fees of $15.9 million) within the gain on sale of contingent payments line item in our consolidated statements of operations for the year ended December 31, 2024. Royalty income related to the Retained Earn-Out Rights, if any, will be recognized in the period when realizable.

Liquidity

As of December 31, 2025, we had cash, cash equivalents and marketable securities of $1.2 billion. Although we have incurred recurring losses and expect to continue to incur losses for the foreseeable future, we expect our cash, cash equivalents and marketable securities to be sufficient to fund current operations for at least the next twelve months from the issuance of the financial statements. If we are unable to raise additional funds through equity or debt financings, we may be required to delay, limit, reduce or terminate product development or future commercialization efforts, or grant rights to develop and market products or product candidates that we would otherwise prefer to develop and market ourselves.

Note 2. Summary of Significant Accounting Policies

Principles of consolidation

The consolidated financial statements include our accounts and the accounts of our wholly owned subsidiaries, Agios Securities Corporation, Agios International Sarl (GmbH), Agios Germany GmbH, Agios Netherlands B.V., Agios Italy S.R.L., Agios

France SARL, and Agios Limited. All intercompany transactions have been eliminated in consolidation. The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles, or U.S. GAAP.

Use of estimates

The preparation of our consolidated financial statements requires us to make estimates, judgments and assumptions that may affect the reported amounts of assets, liabilities, equity, revenues and expenses and related disclosure of contingent assets and liabilities. On an ongoing basis we evaluate our estimates, judgments and methodologies. We base our estimates on historical experience and on various other assumptions that we believe are reasonable, the results of which form the basis for making judgments about the carrying values of assets, liabilities and equity and the amount of revenues and expenses.

Cash and cash equivalents

We consider highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Cash equivalents are stated at fair value.

Accounts receivable, net

Our trade accounts receivable arise from product sales and represent amounts due from specialty distributors and specialty pharmacy providers in the U.S. and our distribution partners outside the U.S. We monitor the financial performance and creditworthiness of our customers so that we can properly assess and respond to changes in their credit profile. We reserve against these receivables for estimated losses that may arise from a customer’s inability to pay. Amounts determined to be uncollectible are charged or written-off against the reserve.

Inventory

Inventory is stated at the lower of cost or estimated net realizable value on a first-in, first-out basis. Prior to the regulatory approval of our product candidates, we incur expenses for the manufacture of drug product that could potentially be available to support the commercial launch of those products. Until the date at which regulatory approval has been received or is otherwise considered probable, we record all such costs as research and development expenses. Upon approval of our wholly owned product, PYRUKYND®, by the FDA on February 17, 2022 for the treatment of hemolytic anemia in adults with PK deficiency in the United States, we began to capitalize inventories of PYRUKYND®. Additionally, upon approval of our wholly owned product, AQVESME™, by the FDA on December 23, 2025 for the treatment of anemia in adults with non-transfusion dependent and transfusion-dependent alpha- or beta-thalassemia in the United States, we began to capitalize inventories of AQVESME™.

Revenue recognition

Under ASC 606, Revenue from Contracts with Customers, or ASC 606, revenue is recognized when the customer obtains control of promised goods or services, in an amount that reflects the consideration that we expect to receive in exchange for those goods or services. To determine revenue recognition for arrangements that have been determined to be within the scope of ASC 606, we perform the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy a performance obligation. We only apply the five-step model to contracts when it is probable that we will collect the consideration we are entitled to in exchange for the goods or services we transfer to the customer.

This standard applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, collaboration arrangements and financial instruments.

Once the contract is determined to be within the scope of ASC 606, we assess the goods or services promised within each contract and determine those that are performance obligations, and assess whether each promised good or service is distinct. We will then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

Product Revenue

We generate product revenue from sales of PYRUKYND® in the United States to a limited number of specialty distributors and specialty pharmacy providers, and to Avanzanite and NewBridge outside of the United States, or collectively, the Customers. These Customers subsequently resell PYRUKYND® to pharmacies or dispense PYRUKYND® directly to patients. In addition to distribution agreements with Customers, we enter into arrangements with healthcare providers and payors that provide for government-mandated and/or privately-negotiated rebates, chargebacks and discounts with respect to the purchase of PYRUKYND®.

The performance obligation related to the sale of PYRUKYND® is satisfied and revenue is recognized when the Customer obtains control of the product, which occurs at a point in time, typically upon delivery to the Customer.

Revenues from product sales are recorded at the net sales price, or transaction price, which includes estimates of variable consideration for which reserves are established and result from contractual adjustments, government rebates, returns and other allowances that are offered within the contracts with our Customers, healthcare providers, payors and other indirect customers relating to the sale of our products.

Contractual Adjustments. We generally provide Customers with discounts, including prompt pay discounts, and allowances that are explicitly stated in the contracts and are recorded as a reduction of revenue in the period the related product revenue is recognized. In addition, we receive sales order management, data and distribution services from certain Customers.

Chargebacks and discounts represent the estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices charged to Customers who directly purchase the product from us. Customers charge us for the difference between what they pay for the product and the ultimate selling price to the qualified healthcare providers. These reserves are estimated using the expected value method, based upon a range of possible outcomes that are probability-weighted for the estimated channel mix and are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue.

Government Rebates. Government rebates include Medicare, TriCare, and Medicaid rebates, which we estimate using the expected value method, based upon a range of possible outcomes that are probability-weighted for the estimated payor mix. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue.

Returns. We estimate the amount of product sales that may be returned by Customers and record this estimate as a reduction of revenue in the period the related product revenue is recognized. We currently estimate product return liabilities using the expected value method, based on available industry data, including our visibility into the inventory remaining in the distribution channel.

Cost of sales

Cost of sales consists primarily of manufacturing costs for sales of PYRUKYND®. Based on our policy to expense costs associated with the manufacturing of our products prior to regulatory approval, certain of the manufacturing costs associated with product shipments of PYRUKYND® recorded during the years ended December 31, 2025, 2024 and 2023 were expensed prior to February 17, 2022 and, therefore, are not included in costs of sales during the years ended December 31, 2025, 2024 and 2023. The amounts excluded from cost of sales were not significant during the years ended December 31, 2025, 2024 and 2023.

Inventories are reviewed periodically to identify excess or obsolete inventory based on projected sales activity as well as product shelf-life. Expired inventory is disposed of, and the related costs are recognized as cost of sales in our consolidated statements of operations, when, based on the expiry date, we do not believe we are able to sell the inventory. We have not reserved for excess or obsolete inventory during the years ended December 31, 2025 and 2024.

Marketable securities

Marketable securities at December 31, 2025 and 2024 consisted of investments in corporate debt securities, U.S. Treasuries, government securities, and certificates of deposit. We determine the appropriate classification of the securities at the time they are acquired and evaluate the appropriateness of such classifications at each balance sheet date. We classify our marketable securities as available-for-sale pursuant to ASC 320, Investments – Debt and Equity Securities. Marketable securities are recorded at fair value. Unrealized gains and losses are included as a component of accumulated other comprehensive income (loss) in the consolidated balance sheets and statements of stockholders’ equity and a component of total comprehensive (loss) income in the consolidated statements of comprehensive (loss) income, until realized. Realized gains and losses are included in interest income, net on a specific-identification basis.

At December 31, 2025 and 2024, we held both current and non-current investments. Investments classified as current are those that: (i) have a maturity of less thanone year, or (ii) have a maturity of greater thanone year but we intend to liquidate within the next twelve months. Investments classified as non-current are those that: (i) have a maturity of greater thanone year, and (ii) we do not intend to liquidate within the nextone year, although these funds are available for use and therefore classified as available-for-sale.

We review marketable securities for impairment whenever the fair value of a marketable security is less than the amortized cost and evidence indicates that a marketable security’s carrying amount is not recoverable. Unrealized losses are evaluated for impairment under ASC 326, Financial Instruments - Credit Losses, to determine if the impairment is credit-related or noncredit-related. Credit-related impairment is recognized as an allowance on the balance sheet with a corresponding adjustment to earnings, and noncredit-related impairment is recognized in other comprehensive (loss) income, net of taxes. Evidence considered in this assessment includes reasons for the impairment, compliance with our investment policy, the severity of the impairment, collectability of the security, and any adverse conditions specifically related to the security, an industry, or geographic area.

Fair value measurements

We record cash equivalents and marketable securities at fair value. ASC 820, Fair Value Measurements and Disclosures, establishes a fair value hierarchy for those instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and our own assumptions (unobservable inputs). The hierarchy consists of three levels:

Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 – Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability.

Level 3 – Unobservable inputs that reflect our own assumptions about the assumptions market participants would use in pricing the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date.

Our financial assets, which include cash equivalents and marketable securities, have been initially valued at the transaction price, and subsequently revalued at the end of each reporting period, utilizing third-party pricing services or other observable market data. The pricing services utilize industry standard valuation models, including both income and market based approaches, and observable market inputs to determine value. After completing our validation procedures, we did not adjust or override any fair value measurements provided by the pricing services as of December 31, 2025 or 2024. Fair value information for these assets, including their classification in the fair value hierarchy is included in Note 3, Fair Value Measurements.

There have been no changes to the valuation methods during the years ended December 31, 2025 and 2024. We evaluate transfers between levels at the end of each reporting period.

The carrying amounts of prepaid expenses and other current assets, accounts payable, and accrued expenses approximate their fair values due to their short-term maturities.

Concentrations of credit risk

Financial instruments which potentially subject us to credit risk consist primarily of cash, cash equivalents, and marketable securities. We hold these investments in highly rated financial institutions, and, by policy, limit the amounts of credit exposure to any one financial institution. These amounts at times may exceed federally insured limits. We have not experienced any credit losses in such accounts and do not believe we are exposed to any significant credit risk on these funds. We have no off-balance sheet concentrations of credit risk, such as foreign currency exchange contracts, option contracts, or other hedging arrangements.

Property and equipment

Property and equipment consist of laboratory equipment, computer equipment and software, leasehold improvements, furniture and fixtures, and office equipment. Costs of major additions and betterment are capitalized; maintenance and repairs, which do not improve or extend the life of the respective assets, are charged to expense as incurred. Upon retirement or sale, the cost of the disposed asset and the related accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized.

Property and equipment is stated at cost, and depreciated using the straight-line method over the estimated useful lives of the respective assets:

Leasehold improvements are amortized over the lesser of the remaining lease term or the estimated useful life of the improvement.

Impairment of long-lived assets

We periodically evaluate our long-lived assets for potential impairment in accordance with ASC 360, Property, Plant and Equipment. Potential impairment is assessed when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered. Recoverability of these assets is assessed based on the undiscounted expected future cash flows from the assets, considering a number of factors, including past operating results, budgets and economic projections, market trends and product development cycles. If impairments are identified, assets are written down to their estimated fair value. We did not recognize any impairment charges through December 31, 2025.

Leases

We determine if an arrangement is a lease at inception. An arrangement is determined to contain a lease if the contract conveys the right to control the use of an identified property or equipment for a period of time in exchange for consideration. If we can benefit from the various underlying assets of a lease on their own or together with other resources that are readily available, or if the various underlying assets are neither highly dependent on nor highly interrelated with other underlying assets in the arrangement, they are considered to be a separate lease component. In the event multiple underlying assets are identified, the lease consideration is allocated to the various components based on each of the component’s relative fair value.

Operating lease assets represent our right to use an underlying asset for the lease term and operating lease liabilities represent our obligation to make lease payments arising from the leasing arrangement. Operating lease assets and operating lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, in determining the operating lease liabilities we use an estimate of our incremental borrowing rate. The incremental borrowing rate is determined using two alternative credit scoring models to estimate our credit rating, adjusted for collateralization. The calculation of the operating lease assets includes any lease payments made and excludes any lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option.

For operating leases, we record operating lease assets and lease liabilities in our consolidated balance sheets. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Short-term leases, or leases that have a lease term of 12 months or less at commencement date, are excluded from this treatment and are recognized on a straight-line basis over the term of the lease.

Research and development costs

Research and development costs, including those accrued as of each balance sheet date, are expensed as incurred. These costs include salaries and personnel-related costs, consulting fees, fees paid for contract research services, fees paid to contract research organizations, or CROs, and other third parties in connection with clinical trials and preclinical development activities, fees paid to investigative sites in connection with clinical trials, the costs associated with the product manufacturing, development, and distribution of clinical supplies, the costs of laboratory equipment and facilities, and other external costs.

Nonrefundable advance payments for goods or services to be received in the future for use in research and development activities are deferred and capitalized. Additionally, there may be instances as of a given balance sheet date in which payments made to our vendors will exceed the level of services provided, and result in a prepayment of the research and development expense. The capitalized amounts are expensed as the related goods are delivered or the services are performed. We estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from our estimate, we adjust the accrual or prepaid accordingly.

Stock-based compensation

We account for stock-based compensation awards in accordance with ASC 718, Compensation –Stock Compensation, or ASC 718. For stock-based awards granted to employees, non-employees and members of the board of directors for their services and for participation in our employee stock purchase plan, we estimate the grant date fair value of each option award using the Black-Scholes option-pricing model. The use of the Black-Scholes option-pricing model requires us to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk-free interest rates and expected dividend yields of the common stock. For awards subject to service-based vesting conditions, we recognize stock-based compensation expense equal to the grant date fair value of stock options on a straight-line basis over the requisite service period. For awards subject to performance-based vesting conditions, we recognize stock-based compensation expense if the performance condition is considered probable of achievement using management’s best estimates.

Income taxes

Income taxes are recorded in accordance with ASC 740, Accounting for Income Taxes, or ASC 740, which provides for deferred taxes using an asset and liability approach. We recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in our financial statements or tax returns. We determine our deferred tax assets and liabilities based on differences between the financial reporting and tax bases of assets and liabilities, which are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Valuation allowances are provided, if based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

We also account for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, we recognize the tax benefit of tax positions to the extent that the benefit will more likely than not be realized. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances.

Comprehensive (loss) income

Comprehensive (loss) income is defined as the change in equity of a business enterprise during a period from transactions, and other events and circumstances, and currently consists of net (loss) income and unrealized gains and losses on available-for-sale securities. Accumulated other comprehensive income (loss) consists entirely of unrealized gains and losses from available-for-sale securities as of December 31, 2025 and 2024.

Net (loss) income per share

Basic net (loss) income per share is calculated by dividing net (loss) income by the weighted-average shares outstanding during the period, without consideration for common stock equivalents. Diluted net (loss) income per share is calculated by adjusting the weighted-average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury stock method. For purposes of the dilutive net (loss) income per share calculation, stock options, restricted stock units, or RSUs, and performance-based stock units, or PSUs, for which the performance and market vesting conditions, respectively, have been deemed probable, and the Amended and Restated 2013 Employee Stock Purchase Plan shares are considered to be common stock equivalents, while PSUs with performance and market vesting conditions, respectively, that were not deemed probable as of December 31, 2025 are not considered to be common stock equivalents.

We utilize the control number concept in the computation of diluted earnings per share to determine whether potential common stock equivalents are dilutive. The control number used is net (loss) income from continuing operations. The control number concept requires that the same number of potentially dilutive securities applied in computing diluted earnings per share from continuing operations be applied to all other categories of income or loss, regardless of their anti-dilutive effect on such categories. Since we had a net loss for the years ended December 31, 2025 and 2023, no dilutive effect was recognized in the calculation of loss per share and basic and diluted net loss per share was the same for those periods.

Segment information

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or CODM, or decision-making group in making decisions on how to allocate resources and assess performance. Our CODM is our chief executive officer, or CEO. Our CEO views our operations and manages our business asone operating segment, which derives its revenues from the development and commercialization of therapies for patients with rare diseases.

Treasury stock

Treasury stock purchases are accounted for under the cost method whereby the entire cost of the acquired stock is recorded as treasury stock. Repurchases of our common stock are accounted for as of the settlement date, and are held as treasury stock until they are retired or re-issued. There were no repurchases, retirements or re-issuances of treasury stock during the years ended December 31, 2025 and 2024.

Recent accounting pronouncements

In December 2023, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2023-09, Income Taxes (Topics 740): Improvements to Income Tax Disclosures, to expand the disclosure requirements for income taxes. Upon adoption, companies will be required to disclose additional specified categories in the rate reconciliation. Companies will also be required to disclose the amount of income taxes paid disaggregated by jurisdiction, among other disclosure requirements. The standard is effective for annual periods beginning after December 15, 2024, and can be applied either prospectively or retrospectively. We adopted the standard during our 2025 annual period and have included required disclosures in Note 11, Income Taxes.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, to improve disclosures around an entity’s expenses. Upon adoption, companies will be required to disclose in the notes to the financial statements a disaggregation of certain expense categories included within the expense captions on the face of the income statement. The standard is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, with early adoption permitted, and can be applied either prospectively or retrospectively. We plan to adopt the standard in our 2027 annual period and are currently assessing its effect on our financial statement disclosures.

In September 2025, the FASB issued ASU No. 2025-07 Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract. The amendments provide for a new scope exception to the derivatives guidance for underlyings based on the operations or activities specific to one of the parties to the contract, and also clarifies that share-based noncash consideration received from a customer as consideration for the transfer of goods or services in a revenue contract is subject to the revenue guidance and not the financial instruments guidance unless and until the company’s right to receive or retain the share-based noncash consideration is unconditional as defined in the ASU. The amendments are effective for annual reporting periods beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption permitted. We plan to adopt the standard in the first quarter of 2026 and are currently assessing its effect on our consolidated financial statements.

Subsequent events

We considered events or transactions occurring after the balance sheet date, but prior to the issuance of the consolidated financial statements, for potential recognition or disclosure in our consolidated financial statements. All significant subsequent events have been properly disclosed in the consolidated financial statements.

Note 3. Fair Value Measurements

The following table summarizes our cash equivalents and marketable securities measured at fair value and by level (as described in Note 2, Summary of Significant Accounting Policies) on a recurring basis as of December 31, 2025:

We hadno financial assets or liabilities that were classified as Level 3 at any point during the year ended December 31, 2025.

Note 4. Marketable Securities

Marketable securities at December 31, 2025 consisted of the following:

Marketable securities at December 31, 2024 consisted of the following:

There wereno material realized gains or losses on marketable securities for the years ended December 31, 2025 and 2024.

At December 31, 2025 and 2024, we held 37 and 213 debt securities, respectively, that were in an unrealized loss position for less than one year. We didnot record an allowance for credit losses as of December 31, 2025 and 2024 related to these securities. The aggregate fair value of debt securities in an unrealized loss position at December 31, 2025 and 2024 was $136.2 million and $768.1 million, respectively. There wereno individual securities that were in a significant unrealized loss position as of December 31, 2025 and 2024. We regularly review the securities in an unrealized loss position and evaluate the current expected credit loss by considering factors such as historical experience, market data, issuer-specific factors, and current economic conditions. We do not consider these marketable securities to be impaired as of December 31, 2025 and 2024.

Note 5. Inventory

Inventory, which consists of commercial supply of PYRUKYND® and AQVESME™, consisted of the following:

Note 6. Leases

Our building leases are comprised of office and laboratory space under non-cancelable operating leases. These lease agreements have remaining lease terms oftwo years and contain various clauses for renewal at our option. The renewal options were not included in the calculation of the operating lease assets and the operating lease liabilities as the renewal options are not reasonably certain of being exercised. The lease agreements do not contain residual value guarantees.

We currently lease approximately 146,000 square feet at 88 Sidney Street,43,000 square feet at 64 Sidney Street, and 13,000 square feet at 38 Sidney Street, Cambridge, Massachusetts. All leases, as amended, expire on February 29, 2028. At the end of the initial lease period, we have the option to extend the leases at all facilities fortwo consecutive five-year periods at the fair market rent at the time of the extension.

The components of lease expense and other information related to leases were as follows:

We have not entered into any material short-term leases or financing leases as of December 31, 2025.

In arriving at the operating lease liabilities as of December 31, 2025, we applied the weighted-average incremental borrowing rate of 5.7% from inception over a weighted-average remaining lease term of 2.2 years. In arriving at the operating lease liabilities as of December 31, 2024, we applied the weighted-average incremental borrowing rate of 5.7% over a weighted-average remaining lease term of 3.2 years.

As of December 31, 2025, undiscounted minimum rental commitments under non-cancelable leases, for each of the next five years and total thereafter, were as follows:

We provided our landlord a security deposit of $2.9 million as security for our leases, which is included within other non-current assets on our consolidated balance sheet.

In August 2021, we entered into a long-term sublease agreement for 13,000 square feet of the office space at 38 Sidney Street, Cambridge, Massachusetts, which expired on December 31, 2024.

In April 2022, we entered into a long-term sublease agreement for 27,000 square feet of the office space at 64 Sidney Street, Cambridge, Massachusetts, which expired on April 30, 2025.

In May 2023, we entered into a long-term sublease agreement for 7,407 square feet of office space on the first floor of 64 Sidney Street, Cambridge, Massachusetts, which expired on July 31, 2025. In July 2025, we entered into a long-term sublease agreement with a new tenant for the same space, which began in November 2025 with the term of the lease running through February 2028.

We recorded operating sublease income of $1.9 million and $6.4 million for the years ended December 31, 2025 and December 31, 2024, respectively, in other income, net in the consolidated statements of operations. We hold security deposits from our sublessee of approximately $0.1 million which is recorded within other non-current assets on our consolidated balance sheet.

As of December 31, 2025, the future minimum lease payments to be received under the long-term sublease agreement was as follows:

Note 7. Accrued Expenses

Accrued expenses consisted of the following at December 31:

Note 8. Product Revenue

We generate product revenue from sales of PYRUKYND® in the United States to a limited number of specialty distributors and specialty pharmacy providers, and to Avanzanite and NewBridge outside of the United States, or collectively, the Customers. These Customers subsequently resell PYRUKYND® to pharmacies or dispense PYRUKYND® directly to patients. In addition to distribution agreements with Customers, we enter into arrangements with healthcare providers and payors that provide for government-mandated and/or privately-negotiated rebates, chargebacks and discounts with respect to the purchase of PYRUKYND®.

The performance obligation related to the sale of PYRUKYND® is satisfied and revenue is recognized when the Customer obtains control of the product, which occurs at a point in time, typically upon delivery to the Customer.

Product revenue, net, was as follows for the years ended December 31:

One Customer accounted for 89%,95% and 96% of our consolidated revenues for the years ended December 31, 2025, 2024 and 2023, respectively, and 55% and 92% of accounts receivable from product sales for the years ended December 31, 2025 and 2024, respectively.

Reserves for Variable Consideration

Revenues from product sales are recorded at the net sales price, or transaction price, which includes estimates of variable consideration for which reserves are established and result from contractual adjustments, government rebates, returns and other allowances that are offered within the contracts with our Customers, healthcare providers, payors and other indirect customers relating to the sale of our products.

The following tables summarize balances and activity in each of the product revenue allowance and reserve categories for the years ended December 31, 2025 and December 31, 2024:

Total revenue-related reserves above, included in our consolidated balance sheets, are summarized as follows:

The following table presents changes in our contract assets, which consisted of accounts receivable, net:

(1) Additions to contract assets relate to amounts billed to Customers for product sales, and deductions to contract assets primarily relate to collection of receivables during the reporting period.

Note 9. Share-Based Payments

2023 Stock Incentive Plan and Inducement Grants

In June 2023, our stockholders approved the 2023 Stock Incentive Plan, or the 2023 Plan. The 2023 Plan provides for the grant of incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock awards, RSUs, PSUs, and other stock-based awards to employees, advisors, consultants and non-employee directors.

Following the adoption of the 2023 Plan, we ceased granting equity awards under the 2013 Stock Incentive Plan, or the 2013 Plan. Any outstanding equity awards that were previously granted under the 2013 Plan continue to be governed by their terms. Following adoption of the 2013 Plan, we ceased granting equity awards under the 2007 Stock Incentive Plan, or the 2007 Plan. There are no outstanding equity awards under the 2007 Plan.

In connection with the start of employment of our Chief Executive Officer and Chief Financial Officer in 2022, our Chief Commercial Officer in 2023, and our Chief Corporate Development and Strategy Officer in March 2025, our Board of Directors granted each of them equity awards in the form of stock options, RSUs and PSUs, which awards were made outside our equity incentive plans as inducements material to their respective entry into employment with us in accordance with Nasdaq Listing Rule 5635(c)(4).

As of December 31, 2025, the maximum number of shares reserved under the 2013 Plan, the 2023 Plan and the inducement grants described above was 12,332,999, and we had 3,835,495 shares available for future issuance under the 2023 Plan.

Stock options

The following table summarizes the stock option activity of all stock incentive plans for the year ended December 31, 2025:

The weighted-average grant date fair value of options granted was $18.68, $18.92 and $14.32 during the years ended December 31, 2025, 2024 and 2023, respectively. The total intrinsic value of options exercised was $1.6 million, $3.3 million and $2.9 million during the years ended December 31, 2025, 2024 and 2023, respectively.

At December 31, 2025, the total unrecognized compensation expense related to unvested stock option awards was $27.3 million, which we expect to recognize over a weighted-average period of approximately 2.36 years.

Restricted stock units

Upon vesting, each RSU entitles the holder to receive a specified number of shares of our common stock. The following table presents RSU activity for the year ended December 31, 2025:

As of December 31, 2025, there was approximately $39.3 million of total unrecognized compensation expense related to RSUs, which we expect to be recognized over a weighted-average period of 1.79 years.

Performance-based stock units

At the achievement of the performance-based and service-based vesting criteria, each PSU entitles the holder to receive a specified number of shares of our common stock. The following table presents PSU activity for the year ended December 31, 2025:

Stock-based compensation expense associated with these PSUs is recognized if the underlying performance condition is considered probable of achievement using our management’s best estimates. As of December 31, 2025, there wasno unrecognized compensation expense related to PSUs with performance-based vesting criteria that are considered probable of achievement that we expect to recognize. There was $12.3 million of total unrecognized compensation expense related to PSUs with performance-based vesting criteria that are considered not probable of achievement.

Amended and Restated 2013 Employee Stock Purchase Plan

In June 2013, our Board of Directors adopted, and in July 2013 our stockholders approved, the 2013 ESPP, which was further amended and restated by our Board of Directors in December 2024. We issued 133,283 shares and 102,805 shares during the years ended December 31, 2025 and 2024, respectively, under the 2013 ESPP. The 2013 ESPP provides participating employees with the opportunity to purchase up to an aggregate of 2,363,636 shares of our common stock. As of December 31, 2025, we had 1,449,951 shares available for future issuance under the 2013 ESPP.

Stock-based compensation expense

During the years ended December 31, 2025, 2024 and 2023, we recorded stock-based compensation expense for employee and non-employee stock options, RSUs, PSUs, and ESPP shares. Stock-based compensation expense by award type included within the consolidated statements of operations is as follows:

Expenses related to equity-based awards were allocated as follows in the consolidated statements of operations:

No related tax benefits were recognized for the years ended December 31, 2025, 2024 and 2023.

The fair value of each stock option granted to employees and non-employees is estimated on the date of grant using the Black-Scholes option-pricing model. The following table summarizes the weighted average assumptions used in calculating the grant date fair value of the awards:

Expected term

We use the “simplified method” as prescribed by the Securities and Exchange Commission Staff Accounting Bulletin No. 107, Share Based Payments, to estimate the expected term of stock option grants. Under this approach, the weighted-average expected life is presumed to be the average of the contractual term often years and the weighted-average vesting term of the stock options, taking into consideration multiple vesting tranches. We utilize this method due to the plain-vanilla nature of our share-based awards.

Volatility

The expected volatility has been determined using our historical volatilities for a period equal to the expected term of the option grant.

Risk-free rate

The risk-free rate is based on the yield curve of U.S. Treasury securities with periods commensurate with the expected term of the options being valued.

Dividends

We have never paid, and do not anticipate paying, any cash dividends in the foreseeable future, and, therefore, use an expected dividend yield ofzero in the option-pricing model.

Forfeitures

We account for forfeitures as they occur and, therefore, do not estimate forfeitures.

Note 10. Net (Loss) Income per Share

Basic net (loss) income per share is calculated by dividing net (loss) income by the weighted-average shares outstanding during the period, without consideration for common stock equivalents. Diluted net (loss) income per share is calculated by adjusting the weighted-average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury stock method. For purposes of the dilutive net (loss) income per share calculation, stock options, RSUs and PSUs for which the performance and market vesting conditions, respectively, have been deemed probable, and 2013 ESPP shares are considered to be common stock equivalents, while PSUs with performance and market vesting conditions, respectively, that were not deemed probable as of December 31, 2025 are not considered to be common stock equivalents.

We utilize the control number concept in the computation of diluted earnings per share to determine whether potential common stock equivalents are dilutive. The control number used is net (loss) income from continuing operations. The control number concept requires that the same number of potentially dilutive securities applied in computing diluted earnings per share from continuing operations be applied to all other categories of income or loss, regardless of their anti-dilutive effect on such categories. Since we had a net loss for the years ended December 31, 2025 and 2023, no dilutive effect was recognized in the calculation of loss per share, and basic and diluted net loss per share was the same for those periods.

The following is a reconciliation of basic weighted-average number of common shares used in computing net (loss) income per share to diluted weighted-average number of common shares used in computing net (loss) income per share for the periods indicated:

The following common stock equivalents were excluded from the calculation of diluted net (loss) income per share applicable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect:

Note 11. Income Taxes

The domestic and foreign components of (loss) income before income taxes are as follows:

As further described in Note 2, Summary of Significant Accounting Policies, we have elected to prospectively adopt the guidance in ASU 2023-09. The following table is a reconciliation of our effective income tax rate to the statutory federal income tax rate for the year ended December 31, 2025 in accordance with the guidance in ASU 2023-09:

The following table is a reconciliation of our effective income tax rate to the statutory federal income tax rate for the years ended December 31, 2024 and 2023 in accordance with the guidance prior to the adoption of ASU 2023-09:

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred tax assets and liabilities for the years ended December 31, 2025 and 2024 are as follows:

On July 4, 2025, the One Big Beautiful Bill Act, or OBBBA, was enacted. The legislation includes several changes to the U.S. federal corporate income tax law, among other things, reinstating 100% bonus depreciation on qualified fixed assets, immediate expensing of domestic research and development expenditures, and favorable rules for determining the limitation on business interest expense. These changes were retroactively enacted for tax years beginning after December 31, 2024 with certain provisions effective after January 19, 2025 and were reflected in the income tax provision for the year ended December 31, 2025. The provisions of the OBBBA did not have a material impact on the effective income tax rate.

As of December 31, 2025, we had net operating loss carryforwards, or NOLs, available to reduce federal, state and foreign income taxes of approximately $515.8 million, $394.1 million and $38.0 million, respectively. The federal NOLs will be carried forward indefinitely and could be used to offset up to 80% of taxable income in all other future years. State NOLs will begin expiring in varying amounts through 2045 unless utilized. At December 31, 2025, we also had available research and development tax credits for federal and state income tax purposes of approximately $32.1 million and $31.2 million, respectively. If not utilized, the credits begin to expire in 2040 and 2028 for federal and state income tax purposes, respectively. Additionally, we engaged in clinical testing activities and incurred expenses that qualify for the federal orphan drug tax credit. At December 31, 2025, we had available orphan drug tax credits for federal purposes only of approximately $47.1 million. If not utilized, these orphan drug credits begin to expire in 2040.

As provided by Section 382 of the Internal Revenue Code of 1986, or Section 382, and similar state provisions, utilization of NOLs and tax credit carryforwards may be subject to substantial annual limitations due to ownership change limitations that have previously occurred or that could occur in the future. Ownership changes may limit the amount of NOLs and tax credit carryforwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an ownership change, as defined by Section 382, results from transactions that increase the ownership of five percent stockholders in the stock of a corporation by more than 50 percent in the aggregate over athree year period. We completed a review of our changes in ownership through December 31, 2025 and determined that transactions have resulted in no ownership changes during the year ended December 31, 2025, as defined by Section 382. The impact of the historical ownership changes has been reflected in our deferred tax assets in the table above.

As required by ASC 740, we have evaluated the positive and negative evidence bearing upon the realizability of our deferred tax assets. Based on the weight of available evidence, both positive and negative, we recorded a valuation allowance of $365.6 million and $275.6 million as of December 31, 2025 and December 31, 2024, respectively, because we have determined that it is more likely than not that these assets will not be fully realized. The valuation allowance increased by $90.1 million for the year ended December 31, 2025 and decreased by $104.1 million for the year ended December 31, 2024. The increase for the year ended December 31, 2025 is primarily due to Section 174 R&D domestic expense and the decrease for the year ended December 31, 2024 relates primarily to the utilization of tax attributes to offset taxable income.

The following table presents our change in valuation allowance for the years ended December 31, 2025 and, 2024:

As of December 31, 2025, the unremitted earnings of our foreign subsidiaries are not material. We have not provided for U.S. income taxes or foreign withholding taxes on these earnings as it is our current intention to permanently reinvest these earnings outside the U.S. The tax liability on these earnings is also not material. Events that could trigger a tax liability include, but are not limited to, distributions, reorganizations or restructurings and/or tax law changes.

We apply the accounting guidance in ASC 740 related to accounting for uncertainty in income taxes. Our reserves related to taxes are based on a determination of whether, and how much of, a tax benefit taken by us in our tax filings or positions is more likely than not to be realized following resolution of any potential contingencies present related to the tax benefit.

The following table presents our unrecognized tax benefits activity for the years ended December 31, 2025 and 2024:

We will recognize interest and penalties related to uncertain tax positions above the line as an expense to continuing operations. As of December 31, 2025 and 2024, we hadno accrued interest or penalties related to uncertain tax positions and no such amounts have been recognized. If all of our unrecognized tax benefits as of December 31, 2025 were to become recognizable in the future, we would record $35.8 million of unrecognized tax benefits. The uncertain tax position does not impact our effective income tax rate due to the full valuation allowance.

We are subject to taxation in the United States, Switzerland, Netherlands, Germany, Italy and France. The statute of limitations for assessment by the IRS and state tax authorities is open for tax years ending December 31, 2025, 2024, 2023, 2022 and 2021, although carryforward attributes that were generated for tax years prior to 2021 may still be adjusted upon examination by the IRS or state tax authorities if they either have been, or will be, used in a future period. The statute of limitations for assessments in Switzerland, the Netherlands and Italy remains open for tax years ending December 31, 2025, 2024, 2023, 2022 and 2021. Our subsidiary in Germany has statute of limitations for assessments open are for the tax years ending December 31, 2025, 2024, 2023, and 2022, and our subsidiary in France has statute of limitations for assessments for the tax years ending December 31, 2025, 2024, and 2023. There are currentlyno federal, state or foreign audits in progress.

As of December 31, 2025 we had an income tax receivable of $0.2 million, which is recorded within prepaid expenses and other current assets in our consolidated balance sheets, and as of December 31, 2024 we had an income tax payable of $0.9 million.

Note 12. Property and Equipment, net

Property and equipment, net consisted of the following at December 31:

Depreciation expense for the years ended December 31, 2025, 2024 and 2023 was $5.2 million, $5.7 million and $6.6 million, respectively.

Note 13. Common Stock

We are authorized to issue 125,000,000 shares of our common stock. Holders of common stock are entitled toone vote per share. Additionally, holders of common stock are entitled to receive dividends, if and when declared by our board of directors, and to share ratably in our assets legally available for distribution to our shareholders in the event of liquidation.

Note 14. Commitments and Contingent Liabilities

Manufacturing Commitments

We are party to various agreements with contract manufacturing organizations that we are not contractually able to terminate for convenience and avoid any and all future obligations to the vendors. Under such agreements, we are obligated to make certain minimum payments, with the exact amounts in the event of termination to be based on the timing of the termination and the exact terms of the agreement.

Legal Contingencies

From time to time, we may be involved in disputes and legal proceedings in the ordinary course of business. These proceedings may include allegations of infringement of intellectual property, employment or other matters. We donot have any ongoing legal proceedings that, based on our estimates, could have a material effect on our consolidated financial statements.

Note 15. Defined Contribution Benefit Plan

We sponsor a 401(k) retirement plan, in which substantially all our full-time employees are eligible to participate. Participants may contribute a percentage of their annual compensation to this plan, subject to statutory limitations. We make matching contributions equal to 100% of the employee’s contributions, subject to a maximum of 4% of eligible compensation.

Note 16. Segment Information

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the CODM or decision-making group in making decisions on how to allocate resources and assess performance. Our CODM is our CEO. Our CEO views our operations and manages our business asone operating segment, which derives its revenues from the development and commercialization of therapies for patients with rare diseases.

Our CEO manages and allocates resources to the operations of our company on a total company basis by assessing the overall level of resources available and how to best deploy these resources across functions and research and development projects that are in line with our long-term company-wide strategic goals. In making these decisions, our CEO uses consolidated financial information for purposes of evaluating performance, forecasting future period financial results, allocating resources and setting incentive targets. The CODM performs this assessment based on our consolidated net (loss) income. Through this analysis, the CODM assesses performance by comparing actual consolidated net (loss) income versus the budget, and then decides how to allocate resources to invest in our research and development programs. The measure of segment assets is reported on the consolidated balance sheets as total assets.

The following table contains additional information on our consolidated revenue and net (loss) income, including significant segment expenses:

*Other segment items primarily include cost of sales, other research and development expenses, interest income and income taxes.