Edgewise Therapeutics, Inc.

Previous wording

The following discussion of the financial condition and results of operations of Edgewise Therapeutics, Inc. should be read in conjunction with the financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q (Quarterly Report), and the audited financial statements and notes included in our Annual Report on Form 10-K (Annual Report), filed with the Securities and Exchange Commission, on February 22, 2024. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. As a result of many factors, including those factors set forth in the “Risk Factors” section of this Quarterly Report, our actual results could differ materially from the results described in or implied by these forward-looking statements. You should carefully read the “Risk Factors” to gain an understanding of the factors that could cause actual results to differ materially from our forward-looking statements. Please also see the section titled “Special Note Regarding Forward-Looking Statements.”

Current wording

The following discussion of the financial condition and results of operations of Edgewise Therapeutics, Inc. should be read in conjunction with the financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q (Quarterly Report), and the audited financial statements and the related notes thereto included in our Annual Report on Form 10-K (Annual Report), filed with the Securities and Exchange Commission, on March 3, 2025. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. As a result of many factors, including those factors set forth in the “Risk Factors” section of this Quarterly Report, our actual results could differ materially from the results described in or implied by these forward-looking statements. You should carefully read the “Risk Factors” to gain an understanding of the factors that could cause actual results to differ materially from our forward-looking statements. Please also see the section titled “Special Note Regarding Forward-Looking Statements.”

Previous wording

Since our inception in 2017, we have been drawing on our deep expertise in muscle physiology and small molecule drug discovery to drive the next generation of first-in-class therapeutics to address a variety of severe muscle diseases. We are advancing two clinical-stage programs in muscular dystrophies and severe cardiac diseases. Sevasemten (EDG-5506) is an orally administered skeletal myosin inhibitor in a pivotal stage trial for Becker muscular dystrophy (Becker) as well as ongoing Phase 2 programs in Duchenne muscular dystrophy. EDG-7500, currently in a multipart Phase 2 trial, is a novel cardiac sarcomere modulator for the treatment of hypertrophic cardiomyopathy (HCM) and other disorders of diastolic dysfunction. We also continue to advance our preclinical pipeline, including characterization of novel cardiometabolic targets. From this foundation and our dedication to muscle physiology and function, we will build a leading global biopharmaceutical company driving advances to improve the lives of people suffering from muscle diseases.

Current wording

Since our inception in 2017, our precision medicine muscle platform has generated several programs to address a variety of muscle diseases. We are advancing two clinical-stage programs in muscular dystrophies and severe cardiac diseases, as well as a number of preclinical programs. Our muscular dystrophy program includes sevasemten, an orally administered fast skeletal myosin inhibitor. Sevasemten is currently being studied in multiple Phase 2 clinical trials, including a pivotal cohort, in patients with either Becker muscular dystrophy (Becker) or Duchenne muscular dystrophy (Duchenne). Our cardiovascular program includes EDG-7500, a novel, oral, selective cardiac sarcomere modulator. EDG-7500 is currently being studied in a multipart Phase 2 trial in both obstructive and non-obstructive hypertrophic cardiomyopathy (HCM). We are also continuing to advance our preclinical exploration, including novel cardiac and cardiometabolic targets. The entire team at Edgewise is dedicated to our mission: changing the lives of patients and families affected by serious muscle diseases.

Previous wording

We have incurred significant losses since the commencement of our operations. Our net losses were $34.1 million and $94.2 million for the three and nine months ended September 30, 2024, respectively and $25.7 million and $70.0 million for the three and nine months ended September 30, 2023, respectively, and we expect to continue to incur significant losses for the foreseeable future as we advance our product candidates through preclinical development and

Current wording

We have incurred significant losses since the commencement of our operations. Our net losses were $40.8 million and $28.5 million for the three months ended March 31, 2025 and 2024, respectively, and we expect to continue to incur significant losses for the foreseeable future as we advance our product candidates through preclinical development and clinical trials and seek regulatory approval of our product candidates. Our net losses may fluctuate significantly from period to period, depending on the timing of and expenditures on our planned research and development activities.

Previous wording

As of September 30, 2024, we had an accumulated deficit of $338.9 million. To date, we have financed our operations primarily through private placements of convertible preferred stock and public offerings of our common stock. From inception through September 30, 2024, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering, issuance of our common stock under an “at the market offering” program (the ATM Program), and underwritten registered direct offering have generated net proceeds of $606.6 million. We believe that our existing cash and cash equivalents and marketable securities of $492.5 million will enable us to fund our planned operating expenses and capital expenditure requirements through at least the next 12 months.

Current wording

As of March 31, 2025, we had an accumulated deficit of $419.4 million. To date, we have financed our operations primarily through private placements of convertible preferred stock and public offerings of our common stock. From inception through March 31, 2025, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering, issuance of our common stock under an “at the market offering” program (the ATM Program), and underwritten registered direct offering have generated net proceeds of $606.6 million. In addition, on April 3, 2025, we closed an underwritten registered direct offering of 9,935,419 shares of our common stock at an offering price of $20.13 per share (April 2025 Offering). The net proceeds from the April 2025 Offering after deducting underwriting discounts and commissions but before offering expenses were $188.0 million. We believe that our existing cash and cash equivalents and marketable securities of $436.4 million will enable us to fund our planned operating expenses and capital expenditure requirements through at least the next 12 months.

Previous wording

We are monitoring macroeconomic and geopolitical developments, such as inflation, instability in the banking and financial services sector, tightening of the credit markets, the upcoming change in the U.S. presidential administration, international conflicts, public health pandemics, cybersecurity and sanctions so that the Company can be prepared to react to new developments as they arise.

Current wording

We are monitoring macroeconomic and geopolitical developments, such as inflation, instability in the banking and financial services sector, tightening of the credit markets, changes in the U.S. government administration and policy positions, international conflicts, public health pandemics, cybersecurity and sanctions so that the Company can be prepared to react to new developments as they arise.

Previous wording

The majority of these expenses have been incurred to advance our lead product candidate, sevasemten and to a lesser degree EDG-7500. We expect that significant additional spending will be required to progress these and other potential discoveries through the remainder of the clinical development phases. These expenses will primarily consist of expenses for the administration of clinical trials as well as manufacturing costs for clinical material supply.

Current wording

The majority of these expenses have been incurred to advance our lead product candidates, sevasemten and EDG-7500. We expect that significant additional spending will be required to progress these and other potential discoveries through the remainder of the clinical development phases. These expenses will primarily consist of expenses for the administration of clinical trials as well as manufacturing costs for clinical material supply.

Previous wording

We track our direct research and development expenses on a program-by-program basis once a lead compound has been selected and clinical trials have been initiated. These direct costs consist primarily of external costs such as fees paid to outside consultants, CROs, CDMOs, clinical trial sites and central laboratories in connection with our discovery and preclinical activities, process development, manufacturing and clinical development activities. These expenses are recognized based on an evaluation of the progress to completion of specific tasks using information provided to us by our service providers or our estimate of the level of service that has been performed at each reporting date. Our direct research and development expenses by program also include costs of laboratory supplies that can be directly attributed to a specific program as well as any fees incurred under license agreements. We do not allocate employee-related costs, including stock-based compensation, or facility expenses, including rent, depreciation or other indirect costs, to specific programs because these costs are deployed across multiple programs and, as such, are not separately classified. We use internal resources primarily to conduct our research and discovery activities and to manage our preclinical development, manufacturing and clinical development activities.

Current wording

We track our direct research and development expenses on a program-by-program basis once a lead compound has been selected and clinical trials have been initiated. These direct costs consist primarily of external costs such as fees paid to outside consultants, CROs, CDMOs, clinical trial sites and central laboratories in connection with our discovery and preclinical activities, process development, manufacturing and clinical development activities. These expenses are recognized based on an evaluation of the progress to completion of specific tasks using information provided to us by our service providers or our estimate of the level of service that has been performed at each reporting date. Our direct research and development expenses by program also include costs of laboratory supplies that can be directly attributed to a specific program as well as any fees incurred under license agreements. We do not allocate employee-related costs, including stock-based compensation, or facility expenses, including rent, depreciation or other indirect costs, to specific programs because these costs are deployed across multiple programs and, as such, are not separately classified. We use

Previous wording

Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages, primarily due to the increased size and duration of later-stage clinical trials. We are currently conducting four Phase 2 clinical trials with sevasemten for people with muscular dystrophy (CANYON, LYNX, FOX and DUNE), a potentially registrational, or pivotal cohort, in individuals with Becker (GRAND CANYON), and a multipart Phase 2 study with EDG-7500 for people with HCM (CIRRUS-HCM). As a result, we expect that our research and development expenses will increase substantially over the next several years as we advance sevasemten, EDG-7500, a product from our EDG-003 cardiometabolic discovery program through clinical trials and additional product candidates; continue to develop our proprietary drug discovery platform; continue to discover and develop additional product candidates; and hire additional personnel.

Current wording

Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages, primarily due to the increased size and duration of later-stage clinical trials. We are currently conducting four Phase 2 clinical trials with sevasemten for people with muscular dystrophy (CANYON, LYNX, FOX and DUNE), including a potentially registrational, or pivotal cohort, in individuals with Becker (GRAND CANYON) as part of the CANYON trial, and a multipart Phase 2 trial with EDG-7500 for people with HCM (CIRRUS-HCM). As a result, we expect that our research and development expenses will increase substantially over the next several years as we advance sevasemten, EDG-7500, a product from our EDG-003 cardiometabolic discovery program through clinical trials and additional product candidates; continue to develop our proprietary drug discovery platform; continue to discover and develop additional product candidates; and hire additional personnel.

Previous wording

Any changes in the outcome of any of these factors could significantly impact the costs and timing

Current wording

Any changes in the outcome of any of these factors could significantly impact the costs and timing associated with the development of our product candidates.

Previous wording

General and administrative expenses were $8.2 million and $5.7 million for the three months ended September 30, 2024 and 2023, respectively. The increase of $2.5 million was primarily due to $1.6 million in increased personnel-related costs from increased headcount and stock-based compensation and $0.9 million in increased professional and consulting costs and other administrative costs.

Current wording

General and administrative expenses were $9.2 million and $7.1 million for the three months ended March 31, 2025 and 2024, respectively. The increase of $2.1 million was primarily due to $1.6 million in increased personnel-related costs from increased headcount and stock-based compensation and $0.5 million in increased professional and consulting costs and other administrative costs.

Previous wording

Interest income was $6.3 million and $3.7 million for the three months ended September 30, 2024 and 2023, respectively. The increase of $2.6 million was primarily due to higher balances of marketable securities during the three months ended September 30, 2024 as compared to the three months ended September 30, 2023.

Current wording

Interest income was $5.2 million and $6.2 million for the three months ended March 31, 2025 and 2024, respectively. The decrease in interest income was primarily due to lower balances of marketable securities during the three months ended March 31, 2025 as compared to the three months ended March 31, 2024.

Previous wording

Since our inception, we have not generated any revenue and have incurred significant operating losses and negative cash flows from our operations. To date, we have financed our operations primarily through private placements of convertible preferred stock and public offerings of our common stock. From inception through September 30, 2024, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering, issuance of our common stock under the ATM Program, and underwritten registered direct offering have generated net proceeds of $606.6 million. As of September 30, 2024, we had cash, cash equivalents and marketable securities in the amount of $492.5 million.

Current wording

Since our inception, we have not generated any revenue and have incurred significant operating losses and negative cash flows from our operations. To date, we have financed our operations primarily through private placements of convertible preferred stock and public offerings of our common stock. From inception through March 31, 2025, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering, issuance of our common stock under the ATM Program, and underwritten registered direct offerings have generated net proceeds of $606.6 million. In addition, the net proceeds from the April 2025 Offering, after deducting underwriting discounts and commissions but before offering expenses, were $188.0 million. As of March 31, 2025, we had cash, cash equivalents and marketable securities in the amount of $436.4 million.

Previous wording

Cash used in operating activities during the nine months ended September 30, 2024 was primarily driven by our net loss for the period of $94.2 million, and was also impacted by changes in operating assets and liabilities which decreased net working capital by $3.4 million. Cash used in operating activities was reduced by non-cash charges of $8.7 million relating to stock-based compensation expense of $17.0 million, amortization of premium and accretion of discounts, net on marketable securities of $9.9 million, depreciation of $1.5 million and amortization of right-of-use asset of $0.2 million.

Current wording

Cash used in operating activities during the three months ended March 31, 2025 was $37.9 million primarily driven by our net loss for the period of $40.8 million, and was also impacted by changes in operating assets and liabilities, which increased net working capital by $4.8 million. Cash used in operating activities was reduced by non-cash charges of $7.7 million relating to stock-based compensation expense of $9.1 million, accretion of discounts, net on marketable securities of $1.9 million, and depreciation of $0.5 million.

Previous wording

Cash used in operating activities during the nine months ended September 30, 2023 was primarily driven by our net loss for the period of $70.0 million, and was also impacted by changes in operating assets and liabilities which increased net working capital by $1.4 million. Cash used in operating activities was reduced by non-cash charges of $6.3 million relating to stock-based compensation expense of $12.4 million, amortization of premium and accretion of discounts, net on marketable securities of $7.3 million, depreciation of $1.1 million and amortization of right-of-use asset of $0.1 million.

Current wording

Cash used in operating activities during the three months ended March 31, 2024 was $28.6 million primarily driven by our net loss for the period of $28.5 million, and was also impacted by changes in operating assets and liabilities which increased net working capital by $2.3 million. Cash used in operating activities was reduced by non-cash charges of $2.2 million relating to stock-based compensation expense of $4.9 million, accretion of discounts, net on marketable securities of $3.2 million, depreciation of $0.5 million and amortization of right-of-use asset of $0.1 million.

Previous wording

Cash used in investing activities during the nine months ended September 30, 2024 amounted to $205.6 million, which was due to $413.9 million in purchases of marketable securities and $1.0 million for purchases of equipment, which was partially offset by $196.6 million in maturities of marketable securities and $12.7 million in sales of marketable securities.

Current wording

Cash provided by investing activities during the three months ended March 31, 2025 amounted to $43.9 million, due to $122.2 million in purchases of marketable securities, which was partially offset by $151.1 million in maturities of marketable securities and $15.0 million in sales of marketable securities.

Previous wording

Cash provided by investing activities during the nine months ended September 30, 2023 amounted to $75.9 million, which was due to $278.4 million in maturities of marketable securities and $19.2 million in sales of marketable securities, which was partially offset by $216.1 million in purchases of marketable securities and $5.6 million for purchases of equipment.

Current wording

Cash provided by investing activities during the three months ended March 31, 2024 amounted to $268.3 million, which was due to $327.6 million in purchases of marketable securities and $0.1 million for purchases of equipment, which was partially offset by $58.7 million in maturities of marketable securities and $0.9 million in sales of marketable securities.

Previous wording

Cash provided by financing activities during the nine months ended September 30, 2023 was $0.2 million, which was due to cash proceeds of $0.3 million in proceeds from the employee stock purchase plan and cash proceeds of 0.1 million from the issuance of common stock upon the exercise of stock options, which was partially offset by $0.2 million for the payment of deferred offering costs.

Current wording

Cash provided by financing activities during the three months ended March 31, 2025 was $2.2 million, due to cash proceeds of $2.3 million in proceeds from the issuance of common stock upon exercise of stock options, which was partially offset by the payment of $38,000 in deferred offering costs.

Previous wording

Cash provided by financing activities during the nine months ended September 30, 2024 was $246.4 million, which was due to cash proceeds of $7.0 million from the ATM Program, $240.0 million from the underwritten registered direct offering, $7.1 million in proceeds from the issuance of common stock upon exercise of stock options, and $0.4 million in proceeds from the employee stock purchase plan, which was partially offset by $7.9 million for the payment of underwriting commissions and offering costs and $0.3 million for the payment of deferred offering costs.

Current wording

Cash provided by financing activities during the three months ended March 31, 2024 was $241.1 million, which was due to cash proceeds of $7.0 million from the ATM Program, $240.0 million from the underwritten registered direct offering, and $1.9 million in proceeds from the issuance of common stock upon exercise of stock options, which was partially offset by $7.8 million for the payment of underwriting commissions and offering costs.

Previous wording

We will continue to require substantial additional capital to develop our product candidates and fund operations for the foreseeable future. On May 10, 2024, we filed an automatic shelf registration statement on Form S-3ASR that allows us to undertake various equity and debt offerings and entered into the Leerink Sales Agreement under which we may offer and sell shares of common stock, having aggregate sales proceeds of up to $175,000,000 from time to time, through the Leerink ATM. We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the development of and seek regulatory approvals for our product candidates and begin to commercialize any approved products. We are subject to all of the risks incident in the development of new products, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may harm our business. In addition, we expect to continue to incur additional costs associated with operating as a public company. Our expenses will also increase if, and as, we:

Current wording

us to undertake various equity and debt offerings and entered into the Leerink Sales Agreement under which we may offer and sell shares of common stock, having aggregate sales proceeds of up to $175.0 million from time to time, through the Leerink ATM. We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the development of and seek regulatory approvals for our product candidates and begin to commercialize any approved products. We are subject to all of the risks incident in the development of new products, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may harm our business. In addition, we expect to continue to incur additional costs associated with operating as a public company. Our expenses will also increase if, and as, we:

Previous wording

administrative expenses. We have entered into contracts in the normal course of business with CROs, CDMOs and other third parties for preclinical research studies and testing, clinical trials and manufacturing services. These contracts do not contain any minimum purchase commitments and are cancelable by us upon prior notice. Payments due upon cancellation consist only of payments for services provided and expenses incurred, including non-cancelable obligations of our service providers, up to the date of cancellation.

Current wording

Our short-term material cash requirements as of March 31, 2025 are to fund our operations, which consist primarily of research and development expenses related to our programs, and to a lesser extent, general and administrative expenses. We have entered into contracts in the normal course of business with CROs, CDMOs and other third parties for preclinical research studies and testing, clinical trials and manufacturing services. These contracts do not contain any minimum purchase commitments and are cancelable by us upon prior notice. Payments due upon cancellation consist

Previous wording

Our long-term cash requirements as of September 30, 2024 includes our lease obligations. In January 2022, we entered into a lease agreement for approximately 18,614 square feet of office and laboratory space in Boulder, Colorado which includes escalating rent payments and an 8.2 year term, plus our share of operating expenses. In February 2023, the lease was modified to occupy an additional 9,624 square feet of office space, with aggregate payments of approximately $1.5 million over the initial 7.3 year term, plus our share of operating expenses. As of September 30, 2024 our total operating lease liability balance is $4.4 million, of which $1.0 million is a current liability.

Current wording

Our long-term cash requirements as of March 31, 2025 includes our lease obligations. In January 2022, we entered into a lease agreement for approximately 18,614 square feet of office and laboratory space in Boulder, Colorado which includes escalating rent payments and an 8.2 year term, plus our share of operating expenses. In February 2023, the lease was modified to occupy an additional 9,624 square feet of office space, with aggregate payments of approximately $1.5 million over the initial 7.3 year term, plus our share of operating expenses. As of March 31, 2025 our total operating lease liability balance is $4.6 million, of which $1.0 million is a current liability.

Previous wording

Our critical accounting policies are described in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” in our Annual Report on Form 10-K filed with the SEC on February 22, 2024 and the notes to the financial statements appearing elsewhere in this Quarterly Report on Form 10-Q. During the three and nine months ended September 30, 2024, there were no material changes to our critical accounting estimates from those discussed in our Annual Report on Form 10-K filed on February 22, 2024.

Current wording

Our critical accounting policies are described in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 3, 2025 and the notes to the financial statements appearing elsewhere in this Quarterly Report. During the three months ended March 31, 2025, there were no material changes to our critical accounting estimates from those discussed in our Annual Report on Form 10-K filed on March 3, 2025.

Previous wording

A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 to our financial statements appearing in our Quarterly Report.

Current wording

A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 to our financial statements appearing in this Quarterly Report.

Previous wording

Emerging Growth Company and Smaller Reporting Company Status

Current wording

Transition from Emerging Growth Company and Smaller Reporting Company Status