Keros Therapeutics Inc

Previous wording

Our second product candidate, cibotercept (KER-012), is designed to bind to and inhibit the signaling of TGF-ß ligands that stimulate the proliferation of vascular endothelial and smooth muscle cells and fibroblasts, including activin A, activin B and myostatin (GDF8). We believe that cibotercept has the potential to increase the signaling of bone morphogenic protein, or BMP, pathways through this inhibition of activin A and activin B signaling, and consequently treat diseases such as pulmonary arterial hypertension, or PAH, that are associated with reduced BMP signaling, including inactivating mutations in the BMP receptors. We are developing cibotercept for the treatment of PAH and for the treatment of cardiovascular disorders. In September 2024, we announced completion of enrollment of our ongoing Phase 2 clinical trial evaluating cibotercept in patients with PAH, which we refer to as the TROPOS trial. We expect to present topline data from the TROPOS trial in the second quarter of 2025.

Current wording

One of our product candidates, cibotercept (KER-012), is designed to bind to and inhibit the signaling of TGF-ß ligands that stimulate the proliferation of vascular endothelial and smooth muscle cells and fibroblasts, including activin A, activin B and myostatin (GDF8). We believe that cibotercept has the potential to increase the signaling of bone morphogenic protein, or BMP, pathways through this inhibition of activin A and activin B signaling, and consequently treat diseases such as pulmonary arterial hypertension, or PAH, that are associated with reduced BMP signaling, including inactivating mutations in the BMP receptors. We are developing cibotercept for the treatment of PAH and for the treatment of cardiovascular disorders. We expect to present topline data from our Phase 2 clinical trial evaluating cibotercept in patients with PAH, which we refer to as the TROPOS trial, in the second quarter of 2025. We announced the early termination of the TROPOS trial in January 2025, based on an ongoing safety review due to the unanticipated observation of pericardial effusion adverse events in the trial. Following completion of the TROPOS trial, we plan to evaluate the appropriate development strategy for cibotercept, including in PAH and other potential indications.

Previous wording

Our third product candidate, KER-065, is designed to bind to and inhibit TGF-ß ligands, including myostatin (GDF8) and activin A, which are negative regulators of muscle and bone mass and strength. Through inhibition of these TGF-ß ligands, we believe that KER-065 has the potential to increase skeletal muscle, increase energy expenditure, reduce body fat, improve insulin resistance and improve cardiac function. We are developing KER-065 for the treatment of obesity and for the treatment of neuromuscular diseases. Increased body adiposity, loss of skeletal muscle and bone loss are consequences of obesity. Significant loss of lean muscle mass has been associated with weight loss mediated by the class of glucagon-like pepetide-1 receptor agonists. We have commenced a Phase 1 clinical trial of KER-065 in a healthy volunteer adult population, and expect to announce initial data from this trial in the first quarter of 2025. Following the completion of this trial, we plan to initiate a proof-of-concept trial of KER-065 in obese patients.

Current wording

Our second product candidate, KER-065, is designed to bind to and inhibit TGF-ß ligands, including myostatin (GDF8) and activin A, which are negative regulators of muscle and bone mass and strength. Through inhibition of these TGF-ß ligands, we believe that KER-065 has the potential to increase skeletal muscle regeneration, increase muscle size and strength, reduce body fat, reduce fibrosis of the skeletal muscle and increase bone strength. We are developing KER-065 for the treatment of neuromuscular disorders, with an initial focus on Duchenne muscular dystrophy, or DMD. Glucocorticoids, the standard of care in DMD, can have significant side effects when used long-term, including catabolism of muscle, increased fat and accelerated bone loss. In March 2025, we announced initial topline results from the Phase 1 clinical trial of KER-065 in healthy volunteers. We plan on engaging with regulatory authorities on the KER-065 program, starting in the third quarter of 2025. Subject to the outcome of these regulatory interactions, we expect to initiate a Phase 2 clinical trial of KER-065 in patients with DMD in the first quarter of 2026.

Previous wording

Our lead product candidate, elritercept (KER-050), is an engineered ligand trap comprised of a modified ligand-binding domain of the TGF-ß superfamily receptor known as activin receptor type IIA, or ActRIIA, that is fused to the portion of the human antibody known as the Fc domain. Elritercept is being developed for the treatment of low blood cell counts, or cytopenias, including anemia and thrombocytopenia, in patients with myelodysplastic syndromes, or MDS, and in patients with myelofibrosis. In June 2024, we announced additional data from our ongoing Phase 2 clinical trial evaluating elritercept for the treatment of anemia and thrombocytopenia in patients with very low-, low-, or intermediate-risk MDS, which we refer to as lower-risk MDS. We expect to report additional data from Part 2 of this trial in the fourth quarter of 2024. Additionally, we received positive feedback from the U.S. Food and Drug Administration regarding the elritercept MDS program, which resulted in general alignment on the design and endpoints for the proposed pivotal, placebo-controlled Phase 3 clinical trial in patients with lower-risk MDS. We expect to provide additional details on the planned trial design in the fourth quarter of 2024. Additionally, in June 2024, we announced additional data from our ongoing Phase 2 clinical trial evaluating elritercept for the treatment of patients with myelofibrosis-associated cytopenias, which we refer to as the RESTORE trial. We expect to announce additional data from the RESTORE trial in the fourth quarter of 2024.

Current wording

Our most advanced product candidate, elritercept (KER-050), is an engineered ligand trap comprised of a modified ligand-binding domain of the TGF-ß receptor known as activin receptor type IIA, or ActRIIA, that is fused to the portion of the human antibody known as the Fc domain. In December 2024, we entered into an exclusive license agreement with Takeda Pharmaceuticals U.S.A., Inc., or Takeda, to further develop, manufacture and commercialize elritercept worldwide outside of mainland China, Hong Kong and Macau, which became effective on January 16, 2025. Elritercept is designed to increase red blood cell and platelet production by inhibiting the signaling of a subset of the TGF-ß family of proteins to promote hematopoiesis. We believe elritercept has the potential to provide benefit to patients suffering from red blood cell and platelet differentiation and maturation defects occurring across the spectrum from early through terminal stages of hematopoiesis, and consequently may be effective for many patients that have limited treatment options or are refractory to available therapies. In December 2024, we announced additional data from our ongoing Phase 2 clinical trial evaluating elritercept for the treatment of anemia and thrombocytopenia in patients with very low-, low-, or intermediate-risk MDS, which we refer to as lower-risk MDS, and initiated our placebo-controlled Phase 3 clinical trial in patients with lower-risk MDS. Additionally, in December 2024, we announced additional data from our ongoing Phase 2 clinical trial evaluating elritercept for the treatment of patients with myelofibrosis-associated cytopenias, which we refer to as the RESTORE trial.

Previous wording

In May 2021, we entered into a Sales Agreement with Leerink Partners LLC, or Leerink, as sales agent, which we refer to as the ATM Sales Agreement, under which we may offer and sell, from time to time, shares of our common stock, or the ATM Shares, through Leerink, which we refer to as the ATM Offering. In May 2021, we filed a registration statement on Form S-3, which we refer to as the Prior Shelf Registration Statement, including a base prospectus and sales agreement prospectus, with the SEC, which became effective immediately upon filing, for the issuance and sale of up to$150.0 million of shares of our common stock under the ATM Sales Agreement. In December 2022, we filed a prospectus supplement to the Prior Shelf Registration Statement for the issuance and sale, if any, of up to an additional $250.0 million of shares of our common stock under the ATM Sales Agreement. In May 2024, we filed a new registration statement on Form S-3, which we refer to as the New Shelf Registration Statement, to replace the Prior Shelf Registration Statement that was set to expire, including a base prospectus, which became effective immediately upon filing, under which we could issue an unspecified amount of shares of our common stock, preferred stock, debt securities and warrants. In June 2024, we filed a prospectus supplement to the New Shelf Registration Statement for the issuance and sale, if any, of up to an additional $350.0 million of shares of our common stock under the ATM Sales Agreement.

Current wording

In December 2022, we filed a prospectus supplementto our registration statement on Form S-3ASR with the Securities and Exchange Commission, or the SEC, for the issuance and sale, if any, of up to $250.0 million of shares of our common stock pursuant to a sales agreement with Leerink Partners LLC, or Leerink, as sales agent, which we refer to as the ATM Sales Agreement, under which we may offer and sell, from time to time, shares of our common stock, or the ATM Shares, through Leerink, which we refer to as the ATM Offering. In May 2024, we filed a new registration statement on Form S-3ASR, which we refer to as the New Shelf Registration Statement, to replace the prior shelf registration statement that was set to expire, including a base prospectus, which became effective immediately upon filing, under which we could issue an unspecified amount of shares of our common stock, preferred stock, debt securities and warrants. In June 2024, we filed a prospectus supplement to the New Shelf Registration Statement for the issuance and sale, if any, of up to an additional$350.0 million of shares of our common stock under the ATM Sales Agreement. As of the filing of the Annual Report, we were not able to use the New Shelf Registration Statement, as we no longer met the criteria of a well-known seasoned issuer.

Previous wording

Under the ATM Sales Agreement, Leerink may sell the ATM Shares by methods deemed to be an “at-the-market offering” as defined in Rule 415(a)(4) promulgated under the Securities Exchange Act of 1934, as amended. We may sell the ATM Shares in amounts and at times to be determined by us from time to time subject to the terms and conditions of the ATM Sales Agreement, but we have no obligation to sell any of the ATM Shares in the ATM Offering. As of September 30, 2024, we have sold a total of 3,059,830 shares of our common stock pursuant to the ATM Offering for aggregate net proceeds of approximately$155.5 million after deducting sales agent commissions and estimated offering expenses. As of September 30, 2024, we may offer and sell ATM shares at an aggregate offering price of up to the remaining$191.9 million (less any sales agent commissions) available under the ATM Offering.

Current wording

Under the ATM Sales Agreement, Leerink may sell the ATM Shares by methods deemed to be an “at-the-market offering” as defined in Rule 415(a)(4) promulgated under the Securities Exchange Act of 1934, as amended. We may sell the ATM Shares in amounts and at times to be determined by us from time to time subject to the terms and conditions of the ATM Sales Agreement, but we have no obligation to sell any of the ATM Shares in the ATM Offering. As of March 31, 2025, we have sold a total of 4,290,096 shares of our common stock pursuant to the ATM Offering for aggregate net proceeds of approximately$228.6 million after deducting sales agent commissions and estimated offering expenses. As of March 31, 2025, we may not offer and sell any ATM shares.

Previous wording

We have incurred recurring operating losses since inception in 2015. Our ability to generate product revenue sufficient to achieve profitability will depend on the successful development and commercialization of one or more of our product candidates. Our net loss was $53.0 million and$141.3 million for thethree and nine months ended September 30, 2024, respectively. As of September 30, 2024, we had an accumulated deficit of $522.8 million. We expect to continue to generate operating losses and negative operating cash flows for the foreseeable future in connection with our ongoing activities. As of September 30, 2024, we had cash and cash equivalents of $530.7 million.

Current wording

We have incurred recurring operating losses each fiscal year since inception in 2015. Our ability to generate product revenue sufficient to achieve profitability will depend on the successful development and commercialization of one or more of our product candidates. Our net income, which was primarily driven by revenue related to our license agreement with Takeda, was $148.5 million for thethree months ended March 31, 2025. As of March 31, 2025, we had an accumulated deficit of $420.3 million. We expect to continue to generate operating losses and negative operating cash flows for the foreseeable future in connection with our ongoing activities. As of March 31, 2025, we had cash and cash equivalents of$720.5 million.

Previous wording

While recent trends towards rising inflation have eased, prices continue to rise, which may also materially affect our business and corresponding financial position and cash flows. Inflationary factors, such as increases in the cost of materials and supplies relating to our preclinical studies, clinical trials, interest rates and overhead costs may adversely affect our operating results. Rising interest rates also present a recent challenge impacting the U.S. economy and could make it more difficult for us to obtain traditional financing on acceptable terms, if at all, in the future. Additionally, the general consensus among economists suggests that we should expect a higher recession risk to continue over the next year, which, together with the foregoing, could result in further economic uncertainty and volatility in the capital markets in the near term, and could negatively affect our operations. Furthermore, such economic conditions have produced downward pressure on share prices. Although we do not believe that inflation or higher interest rates have had a material impact on our financial position or results of operations to date, we may experience increases in the near future (especially if inflation rates rise more quickly) on our operating costs, including our labor costs and research and development costs, due to supply chain constraints, consequences associated with public health crises and global geopolitical tensions, such as the ongoing war between Russia and Ukraine and the war in Israel, worsening global macroeconomic conditions, including as a result of bank failures, and employee availability and wage increases, which may result in additional stress on our working capital resources.

Current wording

While recent trends towards rising inflation have eased, prices continue to rise, which may also materially affect our business and corresponding financial position and cash flows. Inflationary factors, such as increases in the cost of materials and supplies relating to our preclinical studies, clinical trials, interest rates and overhead costs may adversely affect our operating results. Rising interest rates and implementation of tariffs also present a recent challenge impacting the U.S. economy and could make it more difficult for us to obtain traditional financing on acceptable terms, if at all, in the future. Additionally, the general consensus among economists suggests that we should expect a higher recession risk to continue over the next year due in part to ongoing tariff and trade issues, which, together with the foregoing, could result in further economic uncertainty and volatility in the capital markets in the near term, and could negatively affect our operations. Furthermore, such economic conditions have produced downward pressure on share prices. Although we do not believe that inflation, higher interest rates or tariffs have had a material impact on our financial position or results of operations to date, we may experience increases in the near future (especially if inflation rates rise more quickly) on our operating costs, including our labor costs and research and development costs, due to supply chain constraints, consequences associated with public health crises and global geopolitical tensions, such as the ongoing war between Russia and Ukraine and the war in Israel, worsening global macroeconomic conditions, including as a result of bank failures, and employee availability and wage increases, which may result in additional stress on our working capital resources.

Previous wording

On December 12, 2021, we entered into a license agreement with Hansoh (Shanghai) Healthtech Co., Ltd., or Hansoh. Under the terms of the license agreement with Hansoh, or the Hansoh Agreement, we granted to Hansoh the exclusive right to develop, manufacture and commercialize elritercept and licensed products containing elritercept within the territories of mainland China, Hong Kong and Macau, which we refer to collectively as the Territory.

Current wording

On December 12, 2021, we entered into a license agreement with Hansoh (Shanghai) Healthtech Co., Ltd., or Hansoh. Under the terms of the license agreement with Hansoh, or the Hansoh Agreement, we granted to Hansoh the exclusive right to develop, manufacture and commercialize elritercept and licensed products containing elritercept within the territories of mainland China, Hong Kong and Macau, which we refer to collectively as the Hansoh Territory.

Previous wording

In connection with the Hansoh Agreement, Hansoh will purchase clinical trial supply of elritercept from us, and the parties will also negotiate in good faith to enter into an agreement for commercial supply prior to any anticipated commercialization in the Territory. In addition, Hansoh will use commercially reasonable efforts to develop, obtain regulatory approval for, and commercialize licensed products in any region in the Territory.

Current wording

In connection with the Hansoh Agreement, Hansoh will purchase clinical trial supply of elritercept from us, and the parties will also negotiate in good faith to enter into an agreement for commercial supply prior to any anticipated commercialization in the

Previous wording

Pursuant to the terms of the Hansoh Agreement, we received a net $18.0 million upfront payment in January 2022. In addition to the upfront payment, we are entitled to receive up to an aggregate of (i) $26.5 million upon the achievement of specified development milestones and (ii) $144.0 million upon the achievement of specified net sales thresholds for all licensed products in the Territory. If a licensed product is approved for marketing in the Territory, we will be entitled to receive royalty payments based on a tiered percentage of annual net sales in each region within the Territory, with such percentage ranging from the low double digit to high teens, subject to specified potential royalty reductions.

Current wording

Pursuant to the terms of the Hansoh Agreement, we received a net $18.0 million upfront payment in January 2022. In addition to the upfront payment and development milestones achieved to date, we are entitled to receive up to an aggregate of (i) $23.5 million upon the achievement of specified development milestones and (ii) $144.0 million upon the achievement of specified net sales thresholds for all licensed products in the Hansoh Territory. If a licensed product is approved for marketing in the Hansoh Territory, we will be entitled to receive royalty payments based on a tiered percentage of annual net sales in each region within the Hansoh Territory, with such percentage ranging from the low double digit to high teens, subject to specified potential royalty reductions. We did not recognize any revenue related to milestones for the three months ended March 31, 2025 or 2024.

Previous wording

Hansoh’s obligation to pay royalties for a given licensed product in a given region in the Territory will begin on the date of the first commercial sale for such licensed product in such region and continue until the latest of (i) ten years from the date of the first commercial sale for such licensed product in such region, (ii) the expiration of the last valid claim of certain licensed patents or joint patents, and (iii) expiration of regulatory exclusivity in such region. During the royalty term, neither party will directly or indirectly commercialize a competing product in the Territory.

Current wording

Hansoh’s obligation to pay royalties for a given licensed product in a given region in the Hansoh Territory will begin on the date of the first commercial sale for such licensed product in such region and continue until the latest of (i) ten years from the date of the first commercial sale for such licensed product in such region, (ii) the expiration of the last valid claim of certain licensed patents or joint patents, and (iii) expiration of regulatory exclusivity in such region. During the royalty term, neither party will directly or indirectly commercialize a competing product in the Hansoh Territory.

Previous wording

Effective in June 2023, in connection with the Hansoh Agreement, we entered into a manufacturing technology transfer agreement, or the Tech Transfer Agreement, with Hansoh. The Tech Transfer Agreement governs the transfer to Hansoh of all documents and information required to complete the manufacturing technology transfer. Under the Tech Transfer Agreement, Hansoh is obligated to make certain payments to us, at the rates set forth in the Tech Transfer Agreement, as manufacturing technology transfer services are provided over the term of the Tech Transfer Agreement. The Tech Transfer Agreement is set to expire on December 30, 2024, unless extended pursuant to its terms.

Current wording

Effective in June 2023, in connection with the Hansoh Agreement, we entered into a manufacturing technology transfer agreement, or the Tech Transfer Agreement, with Hansoh. The Tech Transfer Agreement governs the transfer to Hansoh of all documents and information required to complete the manufacturing technology transfer. Under the Tech Transfer Agreement, Hansoh is obligated to make certain payments to us, at the rates set forth in the Tech Transfer Agreement, as manufacturing technology transfer services are provided over the term of the Tech Transfer Agreement. We recognized $0.1 million and $0.1 million of service and other revenue for the during the three months ended March 31, 2025 and 2024, respectively.

Previous wording

2020 and 2021, respectively, for the achievement of the clinical and regulatory milestones of (i) filing of an IND in the first country and (ii) the completion of a Phase 1 clinical trial, respectively. We are also obligated to pay tiered royalties on net sales of licensed products ranging in the low-single digits to mid-single digits. The royalty rates are subject to up to a maximum 50% reduction for lack of a valid claim, in the event that it is necessary for us to obtain a license to any third-party intellectual property related to the licensed products, and generic competition. The obligation to pay royalties under the MGH Agreement expires on a licensed product-by-licensed product and country-by-country basis upon the later of expiry of the last valid claim of the licensed patents that cover such licensed product in such country and ten years from the first commercial sale of such product in such country. We are also obligated to pay a percentage of non-royalty-related payments received by us from sublicensees ranging in the sub-teen double digits and a change of control fee equal to a low-single digit percentage of the payments received as part of any completed transaction up to a low-seven digit amount.

Current wording

Additionally, we are required to pay a low-five digit to mid-five digit annual maintenance fee prior to the first commercial sale of our first product or process, a mid-five digit annual maintenance fee after the first commercial sale of our first product or process that is creditable against royalties, certain clinical and regulatory milestone payments for the first three products or indications to achieve such milestones, which milestone payments are $8.6 million in the aggregate, and certain commercial milestone payments for the first three products or indications to achieve such milestones, which milestone payments are $18.0 million in the aggregate. We made payments of $50,000 and $300,000 in 2020 and 2021, respectively, for the achievement of the clinical and regulatory milestones of (i) filing of an IND in the first country and (ii) the completion of a Phase 1 clinical trial, respectively. We are also obligated to pay tiered royalties on net sales of licensed products ranging in the low-single digits to mid-single digits. The royalty rates are subject to up to a maximum 50% reduction for lack of a valid claim, in the event that it is necessary for us to obtain a license to any third-party intellectual property related to the licensed products, and generic competition. The obligation to pay royalties under the MGH Agreement expires on a licensed product-by-licensed product and country-by-country basis upon the later of expiry of the last valid claim of the licensed patents that cover such licensed product in such country and ten years from the first commercial sale of such product in such country. We are also obligated to pay a percentage of non-royalty-related payments received by us from sublicensees ranging in the sub-teen double digits and a change of control fee equal to a low-single digit percentage of the payments received as part of any completed transaction up to a low-seven digit amount.

Previous wording

To date, we have not generated any revenue, and do not expect to generate any revenue in the foreseeable future, from product sales. We have generated revenue solely from research collaborations or licensing of intellectual property. We may in the future generate revenue from other strategic collaborations.

Current wording

To date, we have not generated any revenue, and do not expect to generate any revenue in the foreseeable future, from product sales. We have generated revenue solely from research collaborations or licensing of intellectual property and related transition services. We may in the future generate revenue from other strategic collaborations or licensing arrangements.

Previous wording

Research and development activities are central to our business model. We expect that our research and development expenses will continue to increase for the foreseeable future as we continue ongoing and initiate new clinical trials for our product candidates and continue to discover and develop additional product candidates. We expect research and

Current wording

Research and development activities are central to our business model. We expect that our research and development expenses will continue to increase for the foreseeable future, with the exception of elritercept-related expenses which are expected to decrease once transitioned to Takeda, as we continue ongoing and initiate new clinical trials for our product candidates and continue to discover and develop additional product candidates. We expect research and

Previous wording

Research and development expenses were $128.0 million for the nine months ended September 30, 2024, compared to $97.8 million for the nine months ended September 30, 2023. The increase of $30.2 million was primarily due to (i) an increase of $4.1 million in elritercept-related expenses, primarily driven by an increase of $7.3 million in clinical spend associated with our ongoing Phase 2 clinical trials and planned Phase 3 clinical trial, partially offset by a decrease of $3.2 million in manufacturing and preclinical activities; (ii) an increase of $4.1 million of cibotercept-related expenses, driven by an increase of $6.3 million in clinical spend associated with our ongoing Phase 2 clinical trial, partially offset by a decrease of $2.2 million in manufacturing and preclinical activities; (iii) an increase of $8.9 million of KER-065-related expenses, primarily driven by a net increase of $5.4 million in manufacturing and preclinical activities and an increase of $3.5 million in clinical spend associated with our ongoing Phase 1 clinical trial; (iv) an increase of $1.9 million in preclinical and development fees related to general pipeline development; (v) an increase of $8.7 million related to personnel expenses, which includes an increase of $2.5 million of additional stock-based compensation costs, primarily driven by increased headcount to support the advancement of our pipeline; and (vi) a net increase of $2.6 million in facilities, supplies, professional fees and other expenses due to the growth of our organization.

Current wording

Research and development expenses were $48.7 million for the three months ended March 31, 2025, compared to $38.3 million for the three months ended March 31, 2024. The increase of $10.5 million was primarily due to (i) an increase of $0.4 million of cibotercept-related expenses, primarily driven by a net increase of $0.8 million in preclinical activities and partially offset by a decrease of $0.4 million in clinical spend associated with our Phase 2 clinical trial; (ii) an increase of $10.3 million of elritercept-related expenses, primarily driven by an increase of $5.9 million in manufacturing activities and an increase of $4.4 million in clinical spend associated with our ongoing Phase 2 clinical trials, one in patients with MDS and one in patients with myelofibrosis, and the advancement of a Phase 3 clinical trial in patients with MDS; (iii) an increase of $3.1 million related to personnel expenses, including an increase of $1.4 million of additional stock-based compensation costs, driven by increased headcount to support the advancement of our pipeline; and (iv) a net increase of $1.1 million in facilities, supplies, professional fees and other expenses due to the growth of our organization. These increases were partially offset by (a) a decrease of $2.8 million of KER-065-related expenses, primarily driven by a net decrease of $2.9 million in manufacturing and preclinical activities, offset by an increase of $0.1 million in clinical spend associated with our ongoing Phase 1 clinical trial; and (b) a decrease of $1.6 million in preclinical pipeline and development activities. We expect research and development expenses to fluctuate from quarter to quarter depending on the timing of clinical trial activities, clinical manufacturing and other development activities. We expect that elritercept-related expenses will decrease once transitioned to Takeda.

Previous wording

General and administrative expenses were $9.8 million for the three months ended September 30, 2024, compared to $9.1 million for the three months ended September 30, 2023. The increase of approximately $0.7 million was primarily due to (i) an increase of $0.6 million in personnel expenses, which includes an increase of$0.2 million of additional stock-based compensation costs to support our organizational growth and achievement of our corporate goals; and (ii) a net increase of $0.1 million in professional fees, facilities, supplies and other expenses to support the growth of our business.

Current wording

General and administrative expenses were $10.5 million for the three months ended March 31, 2025, compared to $10.3 million for the three months ended March 31, 2024. The increase of approximately $0.2 million was primarily due to (i) a net increase of $0.5 million in professional fees, insurance, facilities, supplies and other expenses to support the growth of our business, partially offset by a decrease of $0.3 million in personnel expenses, which includes a decrease of$0.6 million of stock-based compensation costs.

Previous wording

Total other income, net was $5.7 million for the three months ended September 30, 2024, comparedto $3.8 million for the three months ended September 30, 2023. The increase of $1.9 million was driven by an increase in dividend income.

Current wording

Total other income, net was $6.5 million for the three months ended March 31, 2025, comparedto $5.4 million for the three months ended March 31, 2024. The increase of $1.1 million was driven by an increase of $1.0 million in dividend income and a decrease of $0.1 million in other expense, net.

Previous wording

Since our inception, we have incurred significant operating losses. Our net losses were $141.3 million and $112.7 million for the nine months ended September 30, 2024 and 2023, respectively. As of September 30, 2024 and December 31, 2023, we had an accumulated deficit of $522.8 million and $381.4 million, respectively. To date, we have devoted the majority of our efforts into business planning, research and development of our product candidates, including by conducting clinical trials and preclinical studies, raising capital and recruiting management and technical staff to support these operations. Our primary uses of cash are to fund operating expenses, which are primarily research and development expenditures. We expect our expenses to increase substantially in connection with our ongoing activities, particularly as we advance the preclinical studies and clinical trials of our product candidates. Furthermore, we expect to incur additional costs associated with operating as a public company, including significant legal, accounting, investor relations, director and officer insurance premiums and other expenses. In addition, if we obtain marketing approval for any of our product candidates, we expect to incur significant commercialization expenses related to establishing sales, marketing, distribution and other commercial infrastructure to commercialize such products.

Current wording

Since our inception, we have incurred significant operating losses each fiscal year. Our net income, which was primarily driven by revenue related to the Takeda Agreement, was $148.5 million for the three months ended March 31, 2025 compared to net loss of $43.1 million for the three months ended March 31, 2024. As of March 31, 2025 and December 31, 2024, we had an accumulated deficit of $420.3 million and $568.8 million, respectively. To date, we have devoted the majority of our efforts into business planning, research and development of our product candidates, including by conducting clinical trials and preclinical studies, raising capital and recruiting management and technical staff to support these operations. Our primary uses of cash are to fund operating expenses, which are primarily research and development expenditures. We expect our expenses to increase substantially in connection with our ongoing activities, particularly as we advance the preclinical studies and clinical trials of our product candidates. Furthermore, we expect to incur additional costs associated with operating as a public company, including significant legal, accounting, investor relations, director and officer insurance premiums and other expenses. In addition, if we obtain marketing approval for any of our product candidates, we expect to incur significant commercialization expenses related to establishing sales, marketing, distribution and other commercial infrastructure to commercialize such products.

Previous wording

We do not have any products approved for sale. We do not expect to generate any revenue from product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our product candidates, which we expect will take a number of years. Since our inception, we have funded our operations primarily through equity financings, research collaborations, or licensing of intellectual property.

Current wording

We currently do not have any products approved for sale. We do not expect to generate any revenue from product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our product candidates, which we expect will take a number of years. Since our inception, we have funded our operations primarily through equity financings, research collaborations, or licensing of intellectual property.

Previous wording

On May 3, 2021, we filed the Prior Shelf Registration Statement, which permitted us to offer, from time to time, an unspecified amount of common stock, preferred stock, debt securities and warrants. We simultaneously entered into the ATM Sales Agreement with Leerink, as agent, to provide for the issuance and sale by us of the ATM Shares from time to time in “at-the-market” offerings under the Prior Shelf Registration Statement, which we refer to as the ATM Program. On May 3, 2024, we filed the New Shelf Registration Statement to replace the Prior Shelf Registration Statement, which permits us to offer, from time to time, an unspecified amount of common stock, preferred stock, debt securities and warrants. During the nine months ended September 30, 2024, we sold 3,059,830 shares of our common stock pursuant to the ATM Offering. As of September 30, 2024, we were eligible to offer and sell, from time to time, shares of our common stock for an aggregate offering amount of up to the remaining $191.9 million available under the ATM Program.

Current wording

In December 2022, we filed a prospectus supplement to a registration statement on Form S-3ASR, including a base prospectus and sales agreement prospectus, or the Prior Shelf Registration Statement, for the issuance and sale of up to $250.0 million of shares of our common stock. On May 3, 2024, we filed a new registration statement on Form S-3ASR, or the New Shelf Registration Statement, to replace the Prior Shelf Registration Statement that was set to expire, which became automatically effective upon filing, and which permitted us to offer, from time to time, an unspecified amount of common stock, preferred stock, debt securities and warrants, including through an “at the market” program with Leerink, as sales agent, or the ATM Program. As of the filing of the Annual Report, we were not able to use the New Shelf Registration Statement, as we no longer met the criteria of a well-known seasoned issuer. As of March 31, 2025, we sold 4,290,096 shares of our common stock pursuant to the ATM Program. As of March 31, 2025, we were not eligible to offer and sell any shares of our common stock under the ATM Program.

Previous wording

As of September 30, 2024, we had cash and cash equivalents of $530.7 million. We believe that our existing cash and cash equivalents will be sufficient to fund our projected liquidity requirements for at least the next 12 months. We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect. Due to the numerous risks and uncertainties associated with the development of our product candidates and programs, and because the extent to which we may enter into collaborations with third parties for development of our product candidates is unknown, we are unable to estimate the timing and amounts of increased capital outlays and operating expenses associated with completing the research and development of our product candidates. Our future funding requirements, both near and long-term, will depend on many factors, including:

Current wording

As of March 31, 2025, we had cash and cash equivalents of $720.5 million. Based on our current operating assumptions, we believe that our existing cash and cash equivalents will be sufficient to fund our projected liquidity requirements into 2029. We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect. Due to the numerous risks and uncertainties associated with the development of our product candidates and programs, and because the extent to which we may enter into collaborations with third parties for development of our product candidates is unknown, we are unable to estimate the timing and amounts of increased capital outlays and operating expenses associated with completing the research and development of our product candidates. Our future funding requirements, both near and long-term, will depend on many factors, including:

Previous wording

•the cost of manufacturing elritercept, cibotercept, KER-065 and future product candidates for clinical trials in preparation for marketing approval and in preparation for commercialization;

Current wording

•the cost of manufacturing cibotercept, KER-065, elritercept and future product candidates for clinical trials in preparation for marketing approval and in preparation for commercialization;

Previous wording

•the cost of establishing sales, marketing and distribution capabilities for any product candidates for which we may receive regulatory approval in regions where we choose to commercialize our products on our own;

Current wording

•the cost of establishing sales, marketing and distribution capabilities for any product candidates for which we may receive regulatory approval in regions where we choose to commercialize our products, if approved, on our own;

Previous wording

•the amount of revenues, if any, we may derive either directly or in the form of royalty payments from future sales of our product candidates, if approved; and

Current wording

•the amount of revenues, if any, we may derive either directly or in the form of royalty payments from future sales of our product candidates, if approved;

Previous wording

The following table summarizes our cash flows for the nine months ended September 30, 2024 and 2023 (in thousands):

Current wording

The following table summarizes our cash flows for the three months ended March 31, 2025 and 2024 (in thousands):

Previous wording

Net cash used in operating activities was $99.0 million for the nine months ended September 30, 2023, which was driven by (i) a net loss of $112.7 million; and (ii) an increase of $9.5 million in net cash used in operating assets and liabilities, partially offset by non-cash charges of (a) $21.4 million of stock-based compensation expense; (b) $1.2 million in lease expenses; and (c) $0.6 million in depreciation. The $9.5 million of net cash used by operating assets and liabilities was primarily comprised of (i) $9.8 million used in prepaid expenses and other assets due to timing of expense recognition for our research and development costs; and (ii) $0.3 million used in our operating lease liabilities.

Current wording

Net cash provided by operating activities was $161.2 million for the three months ended March 31, 2025, which was driven by a (i) net income of $148.5 million; (ii) $2.9 million in net cash provided by operating assets and liabilities; and (iii) non-cash charges including $8.9 million of stock-based compensation expense, $0.6 million in lease expenses and $0.3 million in depreciation. The $2.9 million of net cash provided by operating assets and liabilities was comprised of (i) a $4.5 million decrease in prepaid expenses and other current assets due to timing of expense recognition for our research and development costs; (ii) a $3.3 million increase in deferred revenue; (iii) a $10.0 million increase in current tax liability; and (iv) a $1.6 million decrease in other long-term assets, which was partially offset by (a) a $14.5 million increase in accounts receivable related to the Takeda Agreement; (b) a $1.6 million decrease in accounts payable and accrued expenses to support the advancement of our programs; and (c) a $0.4 million change in operating lease liabilities.

Previous wording

Net cash used in operating activities was $114.9 million for the nine months ended September 30, 2024, which was driven by a net loss of $141.3 million and $1.4 million in net cash used by operating assets and liabilities, partially offset by non-cash charges including $25.7 million of stock-based compensation expense, $1.2 million in lease expenses and $0.9 million in depreciation. The $1.4 million of net cash used in operating assets and liabilities was comprised of (i) $5.0 million used in prepaid expenses and other current assets due to timing of expense recognition for our research and development costs; (ii) a $0.9 million change in our operating lease liabilities; (iii) $0.2 million increase in accounts receivable; offset by (a) $4.3 million increase in accounts payable and accrued expenses to support the advancement of our programs; and (b) $0.5 million decrease in other long-term assets.

Current wording

Net cash used in operating activities was $44.6 million for the three months ended March 31, 2024, which was driven by a net loss of $43.1 million and $10.1 million in net cash used in operating assets and liabilities, partially offset by non-cash charges including $8.1 million of stock-based compensation expense, $0.3 million in lease expenses and $0.3 million in depreciation. The $10.1 million of net cash used by operating assets and liabilities was comprised of (i) $5.3 million used in accounts payable and accrued expenses to support the advancement of our programs; (ii) $4.5 million used in prepaid expenses and other assets due to timing of expense recognition for our research and development costs; (iii) $0.2 million used in our operating lease liabilities; and (iv) $0.1 million used in accounts receivable.

Previous wording

Net cash used in investing activities was $1.6 million for the nine months ended September 30, 2024 and $1.9 million for the nine months ended September 30, 2023. The cash used in investing activities in both periods was due to purchases of property and equipment.

Current wording

Net cash used in investing activities was $0.6 million for the three months ended March 31, 2025 and $0.9 million for the three months ended March 31, 2024. The cash used in investing activities in both periods was due to purchases of property and equipment.

Previous wording

Net cash provided by financing activities was $316.3 million for the nine months ended September 30, 2024, which was primarily related to (i) net proceeds of $151.1 million received from our public offering of common stock in January 2024, after deducting underwriting discounts, commissions and offering expenses; (ii) net proceeds of $155.5 million received from sale of our common stock under the ATM Program, after deducting sales agent commissions and offering expense; and (iii) proceeds of $9.7 million related to exercises of options to purchase common stock.

Current wording

Net cash provided by financing activities was nominal for the three months ended March 31, 2025, and was related to exercises of options to purchase common stock.

Previous wording

Net cash provided by financing activities was $109.7 million for the nine months ended September 30, 2023, which was primarily related to (i) net proceeds of $107.3 million received from sales of our common stock under the ATM Program, after deducting sales agent commissions and offering expenses; and (ii) proceeds of $2.4 million related to exercises of options to purchase common stock.

Current wording

Net cash provided by financing activities was $156.8 million for the three months ended March 31, 2024, which was primarily related to (i) net proceeds of $151.1 million received from our public offering of common stock in January 2024, after deducting underwriting discounts, commissions and offering expenses; and (ii) proceeds of $5.7 million related to exercises of options to purchase common stock.

Previous wording

Refer to Note 2 in the accompanying notes to our unaudited interim condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for a discussion of recent accounting pronouncements. In the nine months ended September 30, 2024, there were no newly applicable recently issued accounting pronouncements.

Current wording

Refer to Note 2 in the accompanying notes to our unaudited interim condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for a discussion of recent accounting pronouncements. In the three months ended March 31, 2025, there were no newly applicable recently issued accounting pronouncements.