Praxis Precision Medicines, Inc.

Previous wording

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and the audited financial information and the notes thereto included in our Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission (the "SEC") on February 28, 2025. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2024 and in the "Risk Factors" section of this Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Current wording

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and the audited financial information and the notes thereto included in our Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission, or the SEC, on February 28, 2025. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” sections of our Annual Report on Form 10-K for the year ended December 31, 2024 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Previous wording

Our platforms utilize a deliberate, pragmatic and patient-guided approach, leveraging a suite of translational tools, including novel transgenic and predictive translational animal models and electrophysiology markers, to enable an efficient path to proof-of-concept in patients. Through this approach, we have established a diversified, multimodal CNS portfolio with four clinical-stage product candidates across epilepsy and movement disorders.

Current wording

Our platforms utilize a deliberate, pragmatic and patient-guided approach, leveraging a suite of translational tools, including novel transgenic and predictive translational animal models and electrophysiology markers, to enable an efficient path to proof-of-concept in patients. Through this approach, we have established a diversified, multimodal CNS portfolio with four clinical-stage product candidates across movement disorders and epilepsy.

Previous wording

For our vormatrigine program (formerly known as PRAX-628) within the Cerebrum™ platform, we announced positive results from our Photo-Paroxysmal Response, or PPR, study in the first quarter of 2024, and initiated the ENERGY program to generate patient eligibility, efficacy, safety and pharmacokinetics (PK) data. The ENERGY program includes five studies: EMPOWER, RADIANT, POWER1, POWER2 and POWER3. We initiated the EMPOWER study, an observational study of vormatrigine in patients with epilepsy, in the third quarter of 2024. In August 2025, we announced positive topline results from our first efficacy study, RADIANT, an open label study in patients with focal onset seizures or generalized epilepsy. We are currently enrolling the POWER1 study, a double-blind, placebo-controlled, 12-week study in focal onset seizures, and expect to finalize the study in the fourth quarter of 2025. POWER2, our third efficacy study, is planned to begin in the third quarter of 2025, with enrollment expected to be completed in the second half of 2026. We intend to initiate POWER3, a clinical trial which will assess vormatrigine as a single-agent treatment for focal onset seizures, in the first half of 2026.

Current wording

For our vormatrigine program (formerly known as PRAX-628) within the Cerebrum™ platform, we announced positive results from our Photo-Paroxysmal Response, or PPR, study in the first quarter of 2024, and initiated the ENERGY program to generate patient eligibility, efficacy, safety and pharmacokinetics data. The ENERGY program includes five studies: EMPOWER, RADIANT, POWER1, POWER2 and POWER3. We initiated the EMPOWER study, an observational study of vormatrigine in patients with epilepsy, in the third quarter of 2024. In August 2025, we announced positive topline results from the first cohort of our first efficacy study, RADIANT, an open label study in patients with focal onset seizures or generalized epilepsy. We plan to share additional RADIANT study results at the American Epilepsy Society Annual Meeting in December 2025. We have completed recruitment of the POWER1 study, a double-blind, placebo-controlled, 12-week study in focal onset seizures, and expect to announce topline results in the first half of 2026. POWER2, our third efficacy study, has started, with enrollment expected to be completed in the second half of 2026. We intend to initiate POWER3, a clinical trial evaluating vormatrigine as a single-agent treatment for focal onset seizures, in the first half of 2026.

Previous wording

For our relutrigine program (formerly known as PRAX-562), we announced positive topline results from the first cohort of our EMBOLD study in the third quarter of 2024, and disclosed updated data from the study's open-label extension through 11 months in May 2025. We are enrolling the second cohort of the EMBOLD study, with topline results expected no later than the first half of 2026. In July 2025, the U.S. Food and Drug Administration granted breakthrough therapy designation for relutrigine for the treatment of seizures associated with SCN2A and SCN8A developmental and epileptic encephalopathies, or DEEs. We have also initiated the EMERALD study in a broader DEE patient population, and expect to complete enrollment in 2026.

Current wording

For our relutrigine program (formerly known as PRAX-562), we announced positive topline results from the first cohort of our EMBOLD study in the third quarter of 2024, and disclosed updated data from the study's open-label extension through 11 months in May 2025. In July 2025, the FDA granted breakthrough therapy designation for relutrigine for the treatment of seizures associated with SCN2A and SCN8A developmental and epileptic encephalopathies, or DEEs. Following a comprehensive Type B meeting with the FDA, we will be performing an interim analysis of the second cohort of the ongoing EMBOLD study in the fourth quarter of 2025. If positive, these study results may support an NDA filing in early 2026. We have also started enrollment of the EMERALD study that is investigating relutrigine in a broader DEE patient population, and expect to be completed in the second half of 2026.

Previous wording

For our most advanced product candidate under the Solidus™ platform, elsunersen (formerly known as PRAX-222), we shared results from Part 1 of the EMBRAVE study in the fourth quarter of 2023. We are currently enrolling the second cohort of the EMBRAVE study in Brazil, with topline results expected in the first half of 2026, and have initiated EMBRAVE3, a Phase 3 registrational study for SCN2A gain-of-function DEE.

Current wording

For our most advanced product candidate under the Solidus™ platform, elsunersen (formerly known as PRAX-222), we shared results from Part 1 of the EMBRAVE study in the fourth quarter of 2023. We are currently enrolling the second cohort of the EMBRAVE study in Brazil, with topline results expected in the first half of 2026. We have initiated EMBRAVE3, a Phase 3 registrational study for SCN2A gain-of-function DEE, and expect to complete in 2026.

Previous wording

We also have three earlier stage novel ASOs with preclinical proof of mechanism. PRAX-080 is focused on PCDH19 mosaic expression, PRAX-090 is targeting SYNGAP1 loss-of-function, or LoF, mutations which is a leading cause of severe intellectual disability and epilepsy in DEEs, and PRAX-100 is targeting SCN2A LoF mutations, the predominant generic link to de novo autism spectrum disorders, or ASD. We anticipate nominating a development candidate for PRAX-100 by mid- 2025, and development candidates for PRAX-080 and PRAX-090 by the end of 2025.

Current wording

We also have three earlier stage novel ASOs with preclinical proof of mechanism. PRAX-080 is focused on PCDH19 mosaic expression, PRAX-090 is targeting SYNGAP1 loss-of-function, or LoF, mutations which is a leading cause of severe intellectual disability and epilepsy in DEEs, and PRAX-100 is targeting SCN2A LoF mutations, the predominant generic link to de novo autism spectrum disorders, or ASD. We anticipate nominating a development candidate for PRAX-080, PRAX-090 and PRAX-100 in the first half of 2026.

Previous wording

We are a development stage company and we have not generated any revenue from product sales, and do not expect to do so for several years, if at all. All of our product candidates are still in preclinical and clinical development. Our ability to generate product revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of one or more of our product candidates, if approved. We have incurred recurring operating losses since inception, including a net loss of $140.4 million for the six months ended June 30, 2025. As of June 30, 2025, we had an accumulated deficit of $977.2 million. We expect to incur significant expenses and operating losses for the foreseeable future as we expand our research and development activities. In addition, our losses from operations may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical trials and our expenditures on other research and development activities. We anticipate that our expenses will be maintained or increased in connection with our ongoing activities, as we:

Current wording

We are a development stage company and we have not generated any revenue from product sales, and do not expect to do so for several years, if at all. All of our product candidates are still in preclinical and clinical development. Our ability to generate product revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of one or more of our product candidates, if approved. We have incurred recurring operating losses since inception, including a net loss of $214.4 million for the nine months ended September 30, 2025. As of September 30, 2025, we had an accumulated deficit of $1.1 billion. We expect to incur significant expenses and operating losses for the foreseeable future as we expand our research and development activities. In addition, our losses from operations may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical trials and our expenditures on other research and development activities. We anticipate that our expenses will be maintained or increased in connection with our ongoing activities, as we:

Previous wording

•advance ulixacaltamide through the Phase 3 Essential3 clinical trial program for ET;

Current wording

•prepare for potential commercialization of ulixacaltamide, following our positive Phase 3 results in the Essential3 clinical trial program for ET;

Previous wording

•advance vormatrigine (formerly PRAX-628) in the ENERGY program;

Current wording

•advance vormatrigine in the ENERGY program;

Previous wording

•advance relutrigine (formally PRAX-562) in the EMBOLD and EMERALD clinical trials;

Current wording

•advance relutrigine in the EMBOLD and EMERALD clinical trials;

Previous wording

•advance elsunersen (formerly PRAX-222) in the EMBRAVE and EMBRAVE3 clinical trials;

Current wording

•advance elsunersen in the EMBRAVE and EMBRAVE3 clinical trials;

Previous wording

As of June 30, 2025, we had cash, cash equivalents and marketable securities of $446.6 million. We expect that our cash, cash equivalents, and marketable securities as of June 30, 2025 will be sufficient to fund our operating expenditures and capital expenditure requirements necessary to advance our research efforts and clinical trials into 2028. The analysis included consideration of our current financial needs and ongoing research and development plans. We have based this estimate on assumptions that may provide to be wrong, and we could exhaust our available capital resources sooner than we expect. See “—Liquidity and Capital Resources.”

Current wording

As of September 30, 2025, we had cash, cash equivalents and marketable securities of $389.2 million. We expect that our cash, cash equivalents, and marketable securities as of September 30, 2025, together with proceeds from our follow-on pubic offering in October 2025, will be sufficient to fund our operating expenditures and capital expenditure requirements necessary to advance our program activities into 2028. The analysis included consideration of our current financial needs and ongoing research, development and commercialization plans. We have based this estimate on assumptions that may provide to be wrong, and we could exhaust our available capital resources sooner than we expect. See “—Liquidity and Capital Resources.”

Previous wording

We have not generated any revenue from the sale of products since inception and do not expect to generate any revenue from the sale of products for several years, if at all. As discussed in Note 7 to our condensed consolidated financial statements, we entered into an Option and License Agreement, or the Collaboration Agreement, with UCB Biopharma SRL, or UCB, in December 2022. During the three and six months ended June 30, 2024, we recognized $0.4 million and $0.8 million of collaboration revenue, respectively. In December 2024, UCB exercised its option to in-license global development and commercialization rights under the terms of the Collaboration Agreement. Accordingly, we did not recognize any collaboration revenue from the Collaboration Agreement during the three and six months ended June 30, 2025. We have no further research service obligations under the terms of the Collaboration Agreement.

Current wording

We have not generated any revenue from the sale of products since inception and do not expect to generate any revenue from the sale of products for several years, if at all. As discussed in Note 7 to our condensed consolidated financial statements, we entered into an Option and License Agreement, or the Collaboration Agreement, with UCB Biopharma SRL, or UCB, in December 2022. During the three and nine months ended September 30, 2024, we recognized $0.3 million and $1.1 million of collaboration revenue, respectively. In December 2024, UCB exercised its option to in-license global development and commercialization rights under the terms of the Collaboration Agreement. Accordingly, we did not recognize any collaboration revenue from the Collaboration Agreement during the three and nine months ended September 30, 2025. We have no further research service obligations under the terms of the Collaboration Agreement.

Previous wording

Since our inception, we have not recorded any U.S. federal or state income tax benefits for the net losses we have incurred in each year or for our earned research and development tax credits due to our uncertainty of realizing a benefit from those items. Income taxes are determined at the applicable tax rates adjusted for non-deductible expenses, research and development tax credits and other permanent differences. Our income tax provision may be significantly affected by changes to our estimates. There was no income tax provision recognized for the three and six months ended June 30, 2025 and 2024.

Current wording

Since our inception, we have not recorded any U.S. federal or state income tax benefits for the net losses we have incurred in each year or for our earned research and development tax credits due to our uncertainty of realizing a benefit from those items. Income taxes are determined at the applicable tax rates adjusted for non-deductible expenses, research and development tax credits and other permanent differences. Our income tax provision may be significantly affected by changes to our estimates. There was no income tax provision recognized for the three and nine months ended September 30, 2025 and 2024.

Previous wording

The $0.4 million decrease in collaboration revenue is associated with a decrease in the revenue recorded under the Collaboration Agreement with UCB that was executed in December 2022. In December 2024, UCB exercised its option to in-license global development and commercialization rights for a development candidate as part of the Collaboration Agreement. As such, we have no further research service obligations under the terms of the Collaboration Agreement and did not record any associated revenue during the three months ended June 30, 2025.

Current wording

The $0.3 million decrease in collaboration revenue is associated with a decrease in the revenue recorded under the Collaboration Agreement with UCB that was executed in December 2022. In December 2024, UCB exercised its option to in-license global development and commercialization rights for a development candidate as part of the Collaboration Agreement. As such, we have no further research service obligations under the terms of the Collaboration Agreement and did not record any associated revenue during the three months ended September 30, 2025.

Previous wording

The $35.7 million increase in research and development expenses was primarily attributable to the following:

Current wording

The $23.9 million increase in research and development expenses was primarily attributable to the following:

Previous wording

•$32.0 million increase in expense related to our Cerebrum™ platform, driven primarily by:

Current wording

•$21.7 million increase in expense related to our Cerebrum™ platform, driven primarily by:

Previous wording

◦a $9.1 million increase in spend for our relutrigine program, primarily related to spend for our EMBOLD study, startup expense for our EMERALD study, phase 1 study spend and current quarter manufacturing spend;

Current wording

◦a $13.4 million increase in spend for our relutrigine program, primarily related to EMBOLD and EMERALD study activities and manufacturing spend;

Previous wording

◦a $0.9 million increase in activities for our earlier stage assets.

Current wording

◦a $1.9 million increase in development activities for our earlier stage assets as we advance our portfolio, partially offset by;

Previous wording

◦a $18.7 million increase in spend for our ulixacaltamide program, primarily due to increased Essential3 activity compared to prior year;

Current wording

◦a $8.2 million decrease in spend for our ulixacaltamide program, primarily due to decreased activity for Essential3 program and phase 1 spending.

Previous wording

•$0.5 million increase in expense related to our Solidus™ platform, primarily elsunersen program spend for our EMBRAVE study and EMBRAVE3 startup costs.

Current wording

•$1.9 million increase in expense related to our Solidus™ platform, driven primarily by elsunersen program spend for EMBRAVE3; and

Previous wording

The $2.5 million increase in general and administrative expenses was primarily attributable to the following:

Current wording

The $2.7 million decrease in general and administrative expenses was primarily attributable to the following:

Previous wording

•$0.4 million increase in professional expenses primarily related to audit fees.

Current wording

•$0.5 million increase in professional expenses.

Previous wording

The $0.8 million decrease in collaboration revenue is associated with a decrease in the revenue recorded under the Collaboration Agreement with UCB that was executed in December 2022. In December 2024, UCB exercised its option to in-license global development and commercialization rights for a development candidate as part of the Collaboration Agreement. As such, we have no further research service obligations under the terms of the Collaboration Agreement and did not record any associated revenue during the six months ended June 30, 2025.

Current wording

The $1.1 million decrease in collaboration revenue is associated with a decrease in the revenue recorded under the Collaboration Agreement with UCB that was executed in December 2022. In December 2024, UCB exercised its option to in-license global development and commercialization rights for a development candidate as part of the Collaboration Agreement. As such, we have no further research service obligations under the terms of the Collaboration Agreement and did not record any associated revenue during the nine months ended September 30, 2025.

Previous wording

The $69.6 million increase in research and development expenses was primarily attributable to the following:

Current wording

The $93.5 million increase in research and development expenses was primarily attributable to the following:

Previous wording

•$62.1 million increase in expense related to our Cerebrum™ platform, driven primarily by:

Current wording

•$83.8 million increase in expense related to our Cerebrum™ platform, driven primarily by:

Previous wording

◦a $15.9 million increase in spend for our vormatrigine program, primarily driven by spend related to Radiant and POWER1, as well as phase 1 study spend;

Current wording

◦a $43.5 million increase in spend for our vormatrigine program, primarily driven by POWER1 and RADIANT study spend as well as phase 1 study activities;

Previous wording

◦a $13.5 million increase in spend for our relutrigine program, primarily spend for our EMBOLD study, startup expense for our EMERALD study, manufacturing spend and phase 1 study spend; and

Current wording

◦a $27.0 million increase in spend for our relutrigine program, primarily related to our EMBOLD and EMERALD trial activities, manufacturing spend and Phase 1 trial spending;

Previous wording

◦a $6.4 million increase in spend for our ulixacaltamide program, primarily due to Essential3 study spend; and

Current wording

◦a $10.5 million increase in spend for our ulixacaltamide program, primarily due to Essential3 study activity; and

Previous wording

◦a $0.6 million increase in activities for our earlier stage assets as we advance our portfolio.

Current wording

◦a $2.8 million increase in activities for our earlier stage assets as we advance our portfolio.

Previous wording

•$0.3 million increase in expense related to our Solidus™ platform, primarily elsunersen program spend.

Current wording

•$2.4 million increase in expense related to our Solidus™ platform, driven by elsunersen program spend; and

Previous wording

•$2.1 million increase in indirect expenses driven primarily by software and consulting spend to support operations; and

Current wording

•$2.2 million increase in indirect expenses driven primarily by software and consulting spend to support operations.

Previous wording

The $1.1 million increase in general and administrative expenses was primarily attributable to the following:

Current wording

The $1.6 million decrease in general and administrative expenses was primarily attributable to the following:

Previous wording

•$2.0 million decrease in personnel-related costs mainly due to decreased stock-based compensation expense.

Current wording

•$3.8 million decrease in personnel-related costs mainly due to decreased stock-based compensation expense;

Previous wording

•$1.6 million increase in professional expenses primarily related to consulting, legal and audit expenses;

Current wording

•$1.3 million increase in professional expenses primarily related to legal and audit expenses; and

Previous wording

•$1.3 million increase in indirect expenses, primarily software to support operations and increased sponsorships and advocacy activities;

Current wording

•$0.9 million increase in indirect expenses, including increased sponsorships and advocacy activities.

Previous wording

Other income for the six months ended June 30, 2025 and 2024 was comprised of interest income on our cash, cash equivalents, and marketable securities and investment premium and discount amortization.

Current wording

Other income for the nine months ended September 30, 2025 and 2024 was comprised of interest income on our cash, cash equivalents, and marketable securities and investment premium and discount amortization.

Previous wording

Since our inception, we have incurred significant losses in each period. We have not yet commercialized any of our product candidates, which are in various phases of preclinical and clinical development, and we do not expect to generate revenue from sales of any products for several years, if at all.

Current wording

Since our inception, we have incurred significant losses in each period. We have not yet commercialized any of our product candidates, which are in various phases of preclinical and clinical development, and we may not generate revenue from sales of any products for several years, if at all.

Previous wording

To date, we have financed our operations primarily with proceeds from the issuance of redeemable convertible preferred stock and from the sale of common stock through an initial public offering, common stock and pre-funded warrants through follow-on public offerings and common stock from at-the-market offerings under our shelf registration statement. From inception through June 30, 2025, we have raised $1.2 billion in aggregate cash proceeds from such transactions, net of issuance costs. As of June 30, 2025, we had cash, cash equivalents and marketable securities of $446.6 million.

Current wording

To date, we have financed our operations primarily with proceeds from the issuance of redeemable convertible preferred stock and from the sale of common stock through an initial public offering, common stock and pre-funded warrants through follow-on public offerings and common stock from at-the-market offerings under our shelf registration statement. From inception through September 30, 2025, we have raised $1.2 billion in aggregate cash proceeds from such transactions, net of issuance costs. As of September 30, 2025, we had cash, cash equivalents and marketable securities of $389.2 million.

Previous wording

In December 2023, we entered into an Open Market Sale Agreement, or the 2023 Sales Agreement, with Jefferies, to provide for the offering, issuance and sale of up to an aggregate amount of $75.0 million of common stock from time to time in at-the-market offerings. The 2023 Sales Agreement was terminated in January 2024. During the six months ended June 30, 2024, we issued and sold an aggregate of 192,190 shares under the 2023 Sales Agreement for aggregate net proceeds of $5.3 million, after deducting commissions and offering expenses payable by us.

Current wording

In December 2023, we entered into an Open Market Sale Agreement, or the 2023 Sales Agreement, with Jefferies, to provide for the offering, issuance and sale of up to an aggregate amount of $75.0 million of common stock from time to time in at-the-market offerings. The 2023 Sales Agreement was terminated in January 2024. During the nine months ended September 30, 2024, we issued and sold an aggregate of 192,190 shares under the 2023 Sales Agreement for aggregate net proceeds of $5.3 million, after deducting commissions and offering expenses payable by us.