Foghorn Therapeutics Inc.

Previous wording

At present, we are working on more than eight programs with one clinical-stage drug candidate currently in Phase 1 development. We have discovered highly selective chemical matter for some of the most challenging targets in oncology including SMARCA2 (BRM), CBP, EP300, and ARID1B as well as other undisclosed targets. We believe our current pipeline has the potential to help more than 500,000 cancer patients. We take a small molecule, modality agnostic approach to drugging targets which includes protein degraders, allosteric enzymatic inhibitors, and transcription factor disruptors. We are a biology-first company, which means we focus first on the underlying genetics and biology of a disease relevant target and then leverage the most appropriate drugging approach to impact the disease biology.

Current wording

At present, we are working on more than seven programs with one clinical-stage drug candidate currently in Phase 1 development. We have discovered highly selective chemical matter for some of the most challenging targets in oncology including SMARCA2 (BRM), CBP, EP300, and ARID1B as well as other undisclosed targets. We believe our current pipeline has the potential to help more than 500,000 cancer patients. We take a small molecule, modality agnostic approach to drugging targets which includes protein degraders, allosteric enzymatic inhibitors, and transcription factor disruptors. We are a biology-first company, which means we focus first on the underlying genetics and biology of a disease relevant target and then leverage the most appropriate drugging approach to impact the disease biology.

Previous wording

On December 10, 2021, we entered into a collaboration agreement (the “Lilly Collaboration Agreement”) with Lilly, for which we received an upfront payment of $300.0 million in January 2022 (see Note 8 to our notes to unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q). Concurrent with the Lilly Collaboration Agreement, we also entered into a stock purchase agreement (the “Lilly SPA”) with Lilly whereby we issued and sold Lilly 4,000,000 shares of our common stock at a price of $20.00 per share, resulting in net proceeds of $80.0 million, of which $42.2 million was allocated to equity upon the issuance of our common stock.

Current wording

On December 10, 2021, we entered into a collaboration agreement (the “Lilly Collaboration Agreement”) with Eli Lilly and Company (“Lilly”), for which we received an upfront payment of $300.0 million in January 2022 (see Note 8 to our notes to unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q). Concurrent with the Lilly Collaboration Agreement, we also entered into a stock purchase agreement (the “Lilly SPA”) with Lilly whereby we issued and sold Lilly 4,000,000 shares of our common stock at a price of $20.00 per share, resulting in net proceeds of $80.0 million, of which $42.2 million was allocated to equity upon the issuance of our common stock.

Previous wording

In October 2024, the Phase 1 dose escalation study of FHD-909, a selective allosteric ATPase inhibitor of SMARCA2, developed in collaboration with Eli Lilly and Company (“Lilly”), dosed its first patient.

Current wording

In October 2024, the Phase 1 dose escalation study of FHD-909, a selective allosteric ATPase inhibitor of SMARCA2, developed in collaboration with Lilly, dosed its first patient.

Previous wording

We have incurred significant operating losses since our inception. For the six months ended June 30, 2025 and the year ended December 31, 2024, we reported net losses of $36.8 million and $86.6 million, respectively. As of June 30, 2025, we had an accumulated deficit of $595.0 million. We expect to continue to incur significant expenses and increasing operating losses for at least the next several years. Our ability to generate any product revenue or product revenue sufficient to achieve profitability will depend on the successful development and eventual commercialization of one or more product candidates we are developing or may develop.

Current wording

We have incurred significant operating losses since our inception. For the nine months ended September 30, 2025 and the year ended December 31, 2024, we reported net losses of $52.6 million and $86.6 million, respectively. As of September 30, 2025, we had an accumulated deficit of $610.8 million. We expect to continue to incur significant expenses and increasing operating losses for at least the next several years. Our ability to generate any product revenue or product revenue sufficient to achieve profitability will depend on the successful development and eventual commercialization of one or more product candidates we are developing or may develop.

Previous wording

We recognized total deferred revenue of $337.8 million related to the Lilly Collaboration Agreement and the Lilly SPA, which included the $300.0 million upfront payment under the Lilly Collaboration Agreement as well as $37.8 million allocated to deferred revenue from the gross proceeds of the Lilly SPA to be recognized over the performance period. For the three months ended June 30, 2025 and 2024, we recognized $7.6 million and $6.9 million, respectively, of revenue under the Lilly Collaboration Agreement. For the six months ended June 30, 2025 and 2024, we recognized $13.5 million and $11.9 million, respectively, of revenue under the Lilly Collaboration Agreement. As of June 30, 2025, we had $266.6 million of deferred revenue related to the above mentioned upfront payment and revenue allocation remaining on our condensed consolidated balance sheets.

Current wording

We recognized total deferred revenue of $337.8 million related to the Lilly Collaboration Agreement and the Lilly SPA, which included the $300.0 million upfront payment under the Lilly Collaboration Agreement as well as $37.8 million allocated to deferred revenue from the gross proceeds of the Lilly SPA to be recognized over the performance period. For the three months ended September 30, 2025 and 2024, we recognized $8.2 million and $7.8 million, respectively, of revenue under the Lilly Collaboration Agreement. For the nine months ended September 30, 2025 and 2024, we recognized $21.7 million and $19.7 million, respectively, of revenue under the Lilly Collaboration Agreement. As of September 30, 2025, we had $258.4 million of deferred revenue related to the above mentioned upfront payment and revenue allocation remaining on our condensed consolidated balance sheets.

Previous wording

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. We are currently assessing its impact on our consolidated financial statements.

Current wording

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The Company has evaluated the impact of the OBBBA and determined that it does not have a material impact on the Company’s condensed consolidated financial statements.

Previous wording

While our significant accounting policies are described in more detail in Note 2 to our consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 as well as elsewhere in this Quarterly Report on Form 10-Q, webelieve that revenue recognition and accrued research and development expenses are those most critical to the judgments and estimates used in the preparation of our unaudited condensed consolidated financial statements. There have been no material changes to our critical accounting policies and estimates detailed in the Critical Accounting Policies and Significant Judgements section of Item 7. Management’s Discussion and Analysis of financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Current wording

While our significant accounting policies are described in more detail in Note 2 to our consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 as well as elsewhere in this Quarterly Report on Form 10-Q, webelieve that revenue recognition and accrued research and development expenses are those most critical to the judgments and estimates used in the preparation of our unaudited condensed consolidated financial statements. There have been no material changes to our critical accounting policies and estimates detailed in the Critical Accounting Estimates section of Item 7. Management’s Discussion and Analysis of financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Previous wording

Comparison of the Three and Six Months Ended June 30, 2025 and 2024

Current wording

Comparison of the Three and Nine Months Ended September 30, 2025 and 2024

Previous wording

The following table summarizes our results of operations for three and six months ended June 30, 2025 and 2024:

Current wording

The following table summarizes our results of operations for three and nine months ended September 30, 2025 and 2024:

Previous wording

Under our collaboration agreement, revenue is recognized based on the work performed during the period. Collaboration revenue was $7.6 million for the three months ended June 30, 2025, compared to $6.9 million for the three months ended June 30, 2024. The increase in collaboration revenue is attributed to continued advancement of programs under the Lilly Collaboration Agreement.

Current wording

Under our collaboration agreement, revenue is recognized based on the work performed during the period. Collaboration revenue was $8.2 million for the three months ended September 30, 2025, compared to $7.8 million for the three months ended September 30, 2024. The increase in collaboration revenue is attributed to continued advancement of programs under the Lilly Collaboration Agreement.

Previous wording

Collaboration revenue was $13.5 million for the six months ended June 30, 2025, compared to $11.9 million for the six months ended June 30, 2024. The increase in collaboration revenue is attributed to continued advancement of programs under the Lilly Collaboration Agreement.

Current wording

Collaboration revenue was $21.7 million for the nine months ended September 30, 2025, compared to $19.7 million for the nine months ended September 30, 2024. The increase in collaboration revenue is attributed to continued advancement of programs under the Lilly Collaboration Agreement.

Previous wording

The following table summarizes our research and development expenses for the three and six months ended June 30, 2025 and 2024:

Current wording

The following table summarizes our research and development expenses for the three and nine months ended September 30, 2025 and 2024:

Previous wording

Research and development expenses were $21.8 million for the three months ended June 30, 2025, compared to $23.8 million for the three months ended June 30, 2024. The decrease is attributed to the following:

Current wording

Research and development expenses were $20.0 million for the three months ended September 30, 2025, compared to $24.7 million for the three months ended September 30, 2024. The decrease is attributed to the following:

Previous wording

•a decrease in FHD-286 costs of $2.5 million due to the decision to discontinue both the independent development of FHD-286 in combination with decitabine in patients with relapsed and/or refractory AML, resulting in the wind down of the Phase 1 clinical trial, and independent development of FHD-286 in patients with uveal melanoma;

Current wording

•a decrease in FHD-286 costs of $3.4 million due to the decision to discontinue both the independent development of FHD-286 in combination with decitabine in patients with relapsed and/or refractory AML, resulting in the shutdown of the Phase 1 clinical trial, and independent development of FHD-286 in patients with uveal melanoma; and

Previous wording

•a decrease in early development and other research external costs of $1.1 million, which was primarily driven by a decrease in preclinical research costs due to program progression; and

Current wording

•a decrease in early development and other research external costs of $0.5 million, which was primarily driven by a decrease in preclinical research costs due to program progression; and

Previous wording

•an increase in Lilly partnered programs of $1.8 million, primarily driven by initiation of the Phase 1 dose escalation study of FHD-909. We expect these costs to continue to increase with increasing enrollment of FHD-909.

Current wording

•an increase in Lilly partnered programs of $0.4 million, primarily driven by initiation of the Phase 1 dose escalation study of FHD-909. We expect these costs to continue to increase with increasing enrollment of FHD-909.

Previous wording

Research and development expenses were $43.4 million for the six months ended June 30, 2025, compared to $49.3 million for the six months ended June 30, 2024. The decrease is attributed to the following:

Current wording

Research and development expenses were $63.4 million for the nine months ended September 30, 2025, compared to $74.0 million for the nine months ended September 30, 2024. The decrease is attributed to the following:

Previous wording

•a decrease in FHD-286 costs of $5.0 million due to the decision to discontinue both the independent development of FHD-286 in combination with decitabine in patients with relapsed and/or refractory AML, resulting in the wind down of the Phase 1 clinical trial, and independent development of FHD-286 in patients with uveal melanoma;

Current wording

•a decrease in FHD-286 costs of $8.4 million due to the decision to discontinue both the independent development of FHD-286 in combination with decitabine in patients with relapsed and/or refractory AML, resulting in the shutdown of the Phase 1 clinical trial, and independent development of FHD-286 in patients with uveal melanoma; and

Previous wording

•a decrease in early development and other research external costs of $3.0 million, which was primarily driven by a decrease in FHD-609 spend due to the shutdown of the Phase 1 clinical trial in synovial sarcoma and SMARCAB1-loss tumors, in addition to a decrease in preclinical research costs due to program progression; and

Current wording

•a decrease in early development and other research external costs of $3.5 million, which was primarily driven by a decrease of $2.1 million in preclinical research costs due to program progression and a decrease in FHD-609 spend of $1.4 million due to the shutdown of the Phase 1 clinical trial in synovial sarcoma and SMARCAB1-loss tumors; and

Previous wording

•an increase in Lilly partnered programs of $2.6 million, primarily driven by initiation of the Phase 1 dose escalation study of FHD-909. We expect these costs to continue to increase with increasing enrollment of FHD-909.

Current wording

•an increase in Lilly partnered programs of $3.0 million, primarily driven by initiation of the Phase 1 dose escalation study of FHD-909. We expect these costs to continue to increase with increasing enrollment of FHD-909.

Previous wording

The following table summarizes our general and administrative expenses for the three and six months ended June 30, 2025 and 2024:

Current wording

The following table summarizes our general and administrative expenses for the three and nine months ended September 30, 2025 and 2024:

Previous wording

General and administrative expenses were$6.9 million for thethree months ended June 30, 2025, compared to$7.3 million for thethree months ended June 30, 2024. The decrease is primarily attributed to a decrease in professional and consulting costs of $0.3 million and a decrease in facilities and IT related expenses and other costs of $0.2 million.

Current wording

General and administrative expenses were$6.7 million for thethree months ended September 30, 2025, compared to$7.0 million for thethree months ended September 30, 2024. The decrease is primarily attributed to a decrease in facilities and IT related expenses and other costs of $0.4 million due to the June 2025 lease modification (see Note 9).

Previous wording

General and administrative expenses were$14.1 million for thesix months ended June 30, 2025, compared to$15.0 million for thesix months ended June 30, 2024. The decrease is primarily attributed to a decrease in professional and consulting costs of $0.7 million and a decrease in facilities and IT related expenses and other costs of $0.3 million.

Current wording

General and administrative expenses were$20.8 million for thenine months ended September 30, 2025, compared to$22.0 million for thenine months ended September 30, 2024. The decrease is primarily attributed to a decrease in professional and consulting costs of $0.7 million and a decrease in facilities and IT related expenses and other costs of $0.7 million due to the June 2025 lease modification.

Previous wording

For the three and six months ended June 30, 2024, the Company recorded a non-cash impairment of long-lived assets charge of $2.4 million related to the sublease of office space at the Company’s main office in Cambridge, MA (see Note 9 to our notes to unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q). There were no impairment charges for the three and six months ended June 30, 2025.

Current wording

For the nine months ended September 30, 2024, the Company recorded a non-cash impairment of long-lived assets charge of $2.4 million related to the sublease of office space at the Company’s main office in Cambridge, MA (see Note 9 to our notes to unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q). There were no impairment charges for the three and nine months ended September 30, 2025.

Previous wording

Other income, net was $3.2 million for the three months ended June 30, 2025, compared to $3.7 million for the three months ended June 30, 2024. The decrease was due to decreased interest income due to a lower average balance of marketable securities during the period.

Current wording

Other income, net was $9.9 million for the nine months ended September 30, 2025, compared to $11.6 million for the nine months ended September 30, 2024. The decrease was due to decreased interest income due to a lower average balance of marketable securities during the period.

Previous wording

Since our inception in October 2015, we have incurred significant operating losses. We expect to incur significant expenses and operating losses for the foreseeable future as we support our continued research activities and development of our programs and platform. Through June 30, 2025, we have funded our operations with proceeds from our initial public offering (“IPO”) in October 2020, sales of preferred stock, term loans, an upfront payment of $15.0 million we received in July 2020 under the Research Collaboration and Exclusive License Agreement (the “Merck Collaboration Agreement”) with Merck Sharp & Dohme Corp. (“Merck”), proceeds we received in December 2021 under the Lilly SPA of $80.0 million; an upfront payment of $300.0 million received in January 2022 under the Lilly Collaboration Agreement; a payment of $5.0 million received from Merck under the Merck Collaboration Agreement in the third quarter of 2022 for the achievement of a research milestone; and net proceeds of $102.8 million, after deducting underwriting discounts, commissions and other offering expenses, from the May 2024 Offering. As of June 30, 2025, we had cash, cash equivalents and marketable securities of $198.7 million.

Current wording

Since our inception in October 2015, we have incurred significant operating losses. We expect to incur significant expenses and operating losses for the foreseeable future as we support our continued research activities and development of our programs and platform. Through September 30, 2025, we have funded our operations with proceeds from our initial public offering (“IPO”) in October 2020, sales of preferred stock, term loans, an upfront payment of $15.0 million we received in July 2020 under the Research Collaboration and Exclusive License Agreement (the “Merck Collaboration Agreement”) with Merck Sharp & Dohme Corp. (“Merck”), proceeds we received in December 2021 under the Lilly SPA of $80.0 million; an upfront payment of $300.0 million received in January 2022 under the Lilly Collaboration Agreement; a payment of $5.0 million received from Merck under the Merck Collaboration Agreement in the third quarter of 2022 for the achievement of a research milestone; and net proceeds of $102.8 million, after deducting underwriting discounts, commissions and other offering expenses, from the May 2024 Offering. As of September 30, 2025, we had cash, cash equivalents and marketable securities of $180.3 million.

Previous wording

During the six months ended June 30, 2025, operating activities used $45.0 million of cash, resulting from our net loss of $36.8 million to fund our operations and by changes in our operating assets and liabilities of $17.0 million partially offset by net non-cash charges of $8.8 million. Net cash used by changes in our operating assets and liabilities for the six months ended June 30, 2025 consisted primarily of a decrease of $13.5 million in deferred revenue resulting from the recognition of revenue on the upfront payments received in connection with the Lilly Collaboration Agreement, a $4.6 million decrease in operating lease liabilities partially offset by a $1.1 million net increase in working capital.

Current wording

During the nine months ended September 30, 2025, operating activities used $63.8 million of cash, resulting from our net loss of $52.6 million to fund our operations and by changes in our operating assets and liabilities of $23.9 million partially offset by net non-cash charges of $12.7 million. Net cash used by changes in our operating assets and liabilities for the nine months ended September 30, 2025 consisted primarily of a decrease of $21.7 million in deferred revenue resulting from the recognition of revenue on the upfront payments received in connection with the Lilly Collaboration Agreement, a $5.8 million decrease in operating lease liabilities partially offset by a $3.5 million net increase in working capital.

Previous wording

During the six months ended June 30, 2024, operating activities used $54.9 million of cash, resulting from the net cash used to fund our net loss of $48.0 million and changes in our operating assets and liabilities of $18.9 million partially offset by net non-cash charges of $12.0 million. Net cash used by changes in our operating assets and liabilities for the six months ended June 30, 2024 was primarily driven by a $11.9 million decrease in deferred revenue resulting from the recognition of revenue on the upfront payments received in connection with the Lilly Collaboration Agreement, a $4.2 million decrease in operating lease liabilities and a $2.8 million net decrease in working capital.

Current wording

During the nine months ended September 30, 2024, operating activities used $75.9 million of cash, resulting from the net cash used to fund our net loss of $67.1 million and changes in our operating assets and liabilities of $24.1 million partially offset by net non-cash charges of $15.4 million. Net cash used by changes in our operating assets and liabilities for the nine months ended September 30, 2024 was primarily driven by a $19.7 million decrease in deferred revenue resulting from the recognition of revenue on the upfront payments received in connection with the Lilly Collaboration Agreement and a $6.0 million decrease in operating lease liabilities partially offset by a $1.6 million net increase in working capital.

Previous wording

During the six months ended June 30, 2025, net cash provided by investing activities was $63.2 million consisting of $156.5 million of marketable securities maturing partially offset by $93.3 million of purchases of marketable securities

Current wording

During the nine months ended September 30, 2025, net cash provided by investing activities was $98.8 million consisting of $196.1 million of marketable securities maturing partially offset by $97.3 million of purchases of marketable securities.

Previous wording

During the six months ended June 30, 2024, net cash provided by investing activities was $9.1 million consisting of $106.6 million of maturities of marketable securities partially offset by $97.4 million of purchases of marketable securities and $0.1 million in purchases of property and equipment.

Current wording

During the nine months ended September 30, 2024, net cash used in investing activities was $52.2 million consisting of $221.8 million of purchases of marketable securities and $0.4 million in purchases of property and equipment, partially offset by $170.1 million of maturities of marketable securities.

Previous wording

During the six months ended June 30, 2025, net cash provided by financing activities was $0.4 million consisting of net proceeds from the exercise of common stock options and the 2020 Employee Stock Purchase Plan (“ESPP”).

Current wording

During the nine months ended September 30, 2025, net cash provided by financing activities was $0.4 million consisting of net proceeds from the exercise of common stock options and the 2020 Employee Stock Purchase Plan (“ESPP”).

Previous wording

During the six months ended June 30, 2024, net cash provided by financing activities was $104.4 million consisting of net proceeds from the offering of our common stock and prefunded warrants of $103.2 million, after deducting underwriting discounts, commissions and other offering expenses that had been paid during the six months ended June 30, 2024, and net proceeds from the exercise of common stock options and the ESPP of $1.2 million.

Current wording

During the nine months ended September 30, 2024, net cash provided by financing activities was $105.4 million consisting of net proceeds from the offering of our common stock and prefunded warrants of $102.8 million, after deducting underwriting discounts, commissions and other offering expenses that had been paid during the nine months ended September 30, 2024, and net proceeds from the exercise of common stock options and the ESPP of $2.6 million.