Denali Therapeutics Inc

Previous wording

•Tividenofusp alfa (DNL310, ETV:IDS), our lead enzyme replacement therapy ("ERT") program enabled by our Enzyme Transport Vehicle ("ETV"), is designed to cross the BBB and restore duronate 2-sulfatase ("IDS") and reduce glycosaminoglycans ("GAGs"), both peripherally and in the brain, in individuals with mucopolysaccharidosis II ("MPS II" or "Hunter syndrome");

Current wording

•Tividenofusp alfa (DNL310, ETV:IDS), our lead enzyme replacement therapy ("ERT") program enabled by our Enzyme Transport Vehicle ("ETV"), is designed to cross the BBB and restore Iduronate 2-sulfatase ("IDS") and reduce glycosaminoglycans ("GAGs"), both peripherally and in the brain, in individuals with mucopolysaccharidosis II ("MPS II" or "Hunter syndrome");

Previous wording

•TAK-594/DNL593 (PTV:PGRN), our recombinant progranulin ("PGRN") biotherapeutic enabled by our Protein Transport Vehicle ("PTV:PGRN"), being developed in collaboration with Takeda, to address frontotemporal dementia-granulin ("FTD-GRN") caused by PGRN deficiency.

Current wording

•TAK-594/DNL593 (PTV:PGRN), our recombinant progranulin ("PGRN") biotherapeutic enabled by our Protein Transport Vehicle ("PTV"), being developed in collaboration with Takeda, to address frontotemporal dementia-granulin ("FTD-GRN"), or frontotemporal dementia due to loss of function mutations in the GRN gene.

Previous wording

•In January 2024, we announced that enrollment continues in the global Phase 2/3 COMPASS study and is expected to be completed in 2024. In February, we presented new positive data from the ongoing Phase 1/2 study of tividenofusp alfa in MPS II at the 20th Annual WORLD Symposium TM demonstrating sustained normalization of heparan sulfate in cerebrospinal fluid (CSF HS), robust and sustained reductions in biomarkers of lysosomal dysfunction and neuronal damage (NfL; neurofilament light), and improvements and stabilization of multiple clinical outcomes measures over two years of treatment. Also in February, we participated in the Reagan-Udall Foundation for the FDA workshop on CSF HS as a potential surrogate biomarker to support accelerated approval in MPS. Based on continued dialogue with the Center for Drug Evaluation and Research (CDER) division of the FDA in April, we believe the division may be open to discussing an accelerated path for tividenofusp alfa. We look forward to continuing the productive dialogue with CDER and, in parallel, conducting the global Phase 2/3 COMPASS study;

Current wording

•In January 2024, we announced that enrollment continues in the global Phase 2/3 COMPASS study and is expected to be completed in 2024. In February, we presented new positive data from the ongoing Phase 1/2 study of tividenofusp alfa in MPS II at the 20th Annual WORLD Symposium TM demonstrating sustained normalization of heparan sulfate in cerebrospinal fluid (CSF HS), robust and sustained reductions in biomarkers of lysosomal dysfunction and neuronal damage (NfL; neurofilament light), and improvements and stabilization of multiple clinical outcomes measures over two years of treatment. Also in February, we participated in the Reagan-Udall Foundation for the FDA workshop on CSF HS as a potential surrogate biomarker to support accelerated approval in MPS. In April, we completed enrollment of 47 participants with MPS II in the Phase 1/2 open-label study. Following the Reagan-Udall Foundation workshop, we received written communication from the Center for Drug Evaluation and Research ("CDER") division of the FDA indicating openness to discussing an accelerated approval pathway for tividenofusp alfa in MPS II with cerebrospinal fluid heparan sulfate (CSF HS) as asurrogate biomarker. We look forward to continued engagement with CDER regarding our intention to file for approval of tividenofusp alfa using the accelerated approval pathway. We will provide an update in 2H 2024;

Previous wording

•In January 2024, we announced that Part B in the TAK-594/DNL593 Phase 1/2 study in participants with FTD-GRN had been voluntarily paused to implement protocol modifications and is expected to resume this year;

Current wording

•In January 2024, we announced that Part B in the TAK-594/DNL593 Phase 1/2 study in participants with FTD-GRN had been voluntarily paused to implement protocol modifications. In the second quarter of 2024, we finalized the protocol amendment for the Phase 1/2 study and prescreening of participants for Cohort B2 is ongoing;

Previous wording

•In February 2024, we announced that the Phase 2 HIMALAYA study evaluating SAR443820/DNL788 in participants with ALS did not meet the primary endpoint of change in ALS Functional Rating Scale-Revised (ALSFRS-R). Sanofi intends to present the detailed efficacy and safety results of the ALS Phase 2 HIMALAYA study at a future scientific forum. Sanofi is evaluating SAR443820/DNL788 in another Phase 2 clinical trial in participants with MS which is fully enrolled, and the outcome of HIMALAYA study has no impact on the ongoing MS study;

Current wording

•In February 2024, we announced that the Phase 2 HIMALAYA study evaluating SAR443820/DNL788 in participants with ALS did not meet the primary endpoint of change in ALS Functional Rating Scale-Revised (ALSFRS-R). Sanofi is evaluating SAR443820/DNL788 in another Phase 2 clinical trial in participants with MS which is fully enrolled, and the outcome of HIMALAYA study has no impact on the ongoing MS study;

Previous wording

•In February 2024, we announced that we executed a Collaboration and Development Funding Agreement in January 2024 with a third party related to a global Phase 2a study of BIIB122/DNL151, which we plan to solely operationalize to evaluate safety and biomarkers associated with BIIB122 in participants with Parkinson’s disease and confirmed pathogenic variants of LRRK2. This agreement includes committed funding of $75.0 million, of which $12.5 million was received in January 2024, and the remainder will be triggered based on time and operational milestones in the study. The third party will be eligible to receive low single-digit royalties from Denali on annual worldwide net sales of LRRK2 inhibitors for the treatment of Parkinson’s disease, with royalty amounts varying based on the scope of the label. We plan to initiate the Phase 2a study in 2024. Biogen will continue to conduct the ongoing global Phase 2b LUMA study in early-stage Parkinson’s disease. Denali and Biogen will co-commercialize BIIB122/DNL151 assuming regulatory approval; and

Current wording

•In February 2024, we announced that we executed a Collaboration and Development Funding Agreement in January 2024 with a third party related to a global Phase 2a study of BIIB122/DNL151, which we plan to solely operationalize to evaluate safety and biomarkers associated with BIIB122 in participants with Parkinson’s disease and confirmed pathogenic variants of LRRK2. This agreement includes committed funding of $75.0 million, of which $12.5 million was received in January 2024 and $12.5 million was received in July 2024, with the remainder to be triggered based on operational milestones in the study. The third party will be eligible to receive low single-digit royalties from Denali on annual worldwide net sales of LRRK2 inhibitors for the treatment of Parkinson’s disease, with royalty amounts varying based on the scope of the label. We plan to initiate the Phase 2a study in 2024. Biogen will continue to conduct the ongoing global Phase 2b LUMA study in early-stage Parkinson’s disease. Denali and Biogen will co-commercialize BIIB122/DNL151 assuming regulatory approval;

Previous wording

We have incurred significant operating losses to date and expect to continue to incur operating losses for the foreseeable future. We had net losses of $101.8 million and $109.8 million for the three months ended March 31, 2024 and 2023, respectively. As of March 31, 2024, we had an accumulated deficit of $1.22 billion. Our ability to generate product revenue will depend on the successful development and eventual commercialization of one or more of our product candidates. We expect to continue to incur significant expenses and operating losses as we advance our current clinical stage programs through healthy volunteer and patient trials; broaden and improve our BBB platform technology; acquire, discover, validate and develop additional product candidates; obtain, maintain, protect and enforce our intellectual property portfolio; and hire additional personnel.

Current wording

We have incurred significant operating losses to date and expect to continue to incur operating losses for the foreseeable future. We had net losses of $99.0 million and $200.8 million for the three and six months ended June 30, 2024, respectively. Due to revenue recognized from our collaboration arrangement with Biogen, we had net income of$183.4 million and $73.6 million for the three and six months ended June 30, 2023, respectively. As of June 30, 2024, we had an accumulated deficit of $1.32 billion. Our ability to generate product revenue will depend on the successful development and eventual commercialization of one or more of our product candidates. We expect to continue to incur significant expenses and operating losses as we advance our current clinical stage programs through healthy volunteer and patient trials; broaden and improve our BBB platform technology; acquire, discover, validate and develop additional product candidates; obtain, maintain, protect and enforce our intellectual property portfolio; and hire additional personnel.

Previous wording

Program expenses include expenses associated with our most advanced product candidates and the discovery and development of backup or next-generation molecules. We also track external expenses associated with our TV platform. These expenses include external expenses incurred by us relating to our Takeda Collaboration Agreement, Sanofi Collaboration Agreement and Biogen Collaboration Agreement. All external costs associated with earlier stage programs, or that benefit the entire portfolio, are tracked as a group. We also incur personnel and other operating expenses for our research and development programs which are presented in aggregate. These expenses primarily relate to salaries and benefits, stock-based compensation, facility expenses including rent and depreciation, and lab consumables. Where we share costs with our collaboration partners, such as in our Biogen Collaboration Agreementand Takeda Collaboration Agreement, research and development expenses may include cost sharing reimbursements from, or payments to, our collaboration partners.

Current wording

Program expenses include expenses associated with our most advanced product candidates and the discovery and development of backup or next-generation molecules. We also track external expenses associated with our TV platform. These expenses include external expenses incurred by us relating to our Takeda Collaboration Agreement, Sanofi Collaboration Agreement and Biogen Collaboration Agreement. All external costs associated with earlier stage programs, or that benefit the entire portfolio, are tracked as a group. We also incur personnel and other operating expenses for our research and development programs which are presented in aggregate. These expenses primarily relate to salaries and benefits, stock-based compensation, facility expenses including rent and depreciation, and lab consumables. Where we share costs with our collaboration partners, such as in our Biogen Collaboration Agreementand Takeda Collaboration Agreement, research and development expenses may include cost sharing reimbursements from, or payments to, our collaboration partners. Further, where we receive R&D funding from third parties, this may be recognized as a reduction to research and development expenses.

Previous wording

It is challenging to predict the nature, timing and estimated long-range costs of the efforts that will be necessary to complete the development of, and obtain regulatory approval for, any of our product candidates. This is made more challenging by events outside of our control, such as the COVID-19 pandemic and increased geopolitical uncertainty. We are also unable to predict when, if ever, material net cash inflows will commence from sales or licensing of our product candidates. This is due to the numerous risks and uncertainties associated with drug development, including the uncertainty of:

Current wording

It is challenging to predict the nature, timing and estimated long-range costs of the efforts that will be necessary to complete the development of, and obtain regulatory approval for, any of our product candidates. This is made more challenging by events outside of our control, such as global pandemics and increased geopolitical uncertainty. We are also unable to predict when, if ever, material net cash inflows will commence from sales or licensing of our product candidates. This is due to the numerous risks and uncertainties associated with drug development, including the uncertainty of:

Previous wording

Research and development expenses. Research and development expenses were $107.0 million and $128.8 million for the three months ended March 31, 2024 and 2023, respectively.

Current wording

Research and development expenses. Research and development expenses were $91.4 million and $198.4 million for the three and six months ended June 30, 2024, compared to $97.5 million and $226.3 million for the three and six months ended June 30, 2023, respectively.

Previous wording

(1)Personnel related expenses include stock-based compensation expense of $16.3 million and $16.8 million for the three months ended March 31, 2024 and 2023, respectively.

Current wording

(1)Personnel related expenses include stock-based compensation expense of $14.4 million and $30.7 million for the three and six months ended June 30, 2024, respectively, and $15.2 million and $32.0 million for the three and six months ended June 30, 2023, respectively, reflecting decreases of $0.8 million and $1.3 million, respectively.

Previous wording

(2)Net cost sharing payments details are broken down as shown in the table below. The underlying costs for reimbursements are included with the specified external expenses line and personnel related expenses in the table above. ATV:TREM2 program external expenses are presented within the TV platform and other program external expenses line.

Current wording

(2)The breakdown of net cost sharing and research funding payments is shown in the table below. The underlying costs for reimbursements and research funding are included with the specified external expenses line and personnel related expenses in the table above. ATV:TREM2 program external expenses are presented within the TV platform and other program external expenses line.

Previous wording

The decrease in research and development expenses of approximately $21.8 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023, was primarily attributable to the following:

Current wording

The decrease in research and development expenses of approximately $6.1 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023, was primarily attributable to the following:

Previous wording

•a decrease of $1.9 million in other external research and development expenses.

Current wording

•a decrease of $1.9 million in other external research and development expenses associated with the divestiture of our preclinical small molecule programs.

Previous wording

•a decrease of $16.9 million in ETV:IDS program external expenses because the first quarter of 2023 included expense for a contingent consideration payment of $30.0 million related to the acquisition of F-star Gamma, which was triggered in March 2023 upon the achievement of a specified clinical milestone in the ETV:IDS program. This decrease was partially offset by increased spend from the continued progress of this program in clinical trials in 2024, including costs related to our ongoing Phase 1/2 study and our potentially registrational Phase 2/3 study;

Current wording

•a decrease of $16.5 million in ETV:IDS program external expenses because the first quarter of 2023 included expense for a contingent consideration payment of $30.0 million related to the acquisition of F-star Gamma, which was triggered in March 2023 upon the achievement of a specified clinical milestone in the ETV:IDS program. This decrease was partially offset by increased spend from the continued progress of this program in clinical trials in 2024, including costs related to our ongoing Phase 1/2 study and our potentially registrational Phase 2/3 study;

Previous wording

•decreases of $1.9 million and $1.2 million in TV platform and other program external expenses including ATV:TREM2 expenses, and PTV:PGRN program external expenses, respectively, due to the discontinuation of clinical development of TAK-920/DNL919 (ATV:TREM2) in Alzheimer’s disease and voluntary pause of Part B in the TAK-594/DNL593 (PTV:PGRN) Phase 1/2 study, respectively;

Current wording

•decreases of $2.0 million and $2.6 million in TV platform and other program external expenses including ATV:TREM2 expenses, and PTV:PGRN program external expenses, respectively, due to the discontinuation of clinical development of TAK-920/DNL919 (ATV:TREM2) in Alzheimer’s disease and voluntary pause of Part B in the TAK-594/DNL593 (PTV:PGRN) Phase 1/2 study, respectively;

Previous wording

These decreases were partially offset by increases of $2.9 million and $1.8 million in eIF2B and ETV:SGSH program external expenses, respectively, reflecting the continued progress of these programs in clinical trials during 2024, and an increase of $2.1 million in net cost sharing payments due to increased payments due to Biogen as a result of increased LRRK2 clinical trial costs incurred by Biogen, offset by decreased reimbursements from Takeda as a result of the discontinuation of TREM2 DNL919 phase 1 trial and temporary pause of TAK-594/DNL593.

Current wording

These decreases were partially offset by increases of $6.6 million and $2.5 million in eIF2B and ETV:SGSH program external expenses, respectively, reflecting the continued progress of these programs in clinical trials.

Previous wording

General and administrative expenses. General and administrative expenses were$25.2 million for the three months ended March 31, 2024 compared to $27.1 million for the three months ended March 31, 2023. Thedecrease of $1.9 million was primarily attributable to$2.4 million of combined decreases in professional services, facilities and other corporate costs, partially offset by $0.5 million of increased personnel-related expenses consisting of employee compensation and stock-based compensation expense.

Current wording

General and administrative expenses. General and administrative expenses were$25.2 million for the three months ended June 30, 2024 compared to $26.1 million for the three months ended June 30, 2023. Thedecrease of$0.9 million was primarily attributable to adecrease of $1.1 million in personnel-related expenses consisting of employee compensation and stock-based compensation expense, partially offset by combined increases of $0.2 million in professional services, facilities and other corporate costs.

Previous wording

As of March 31, 2024, we had cash, cash equivalents and marketable securities in the amount of $1.43 billion. We fund our operations primarily with the proceeds from the sale of common stock and payments received from our collaboration partners, including those received under agreements with Takeda, Sanofi, and Biogen. We have sold common stock and other securities in public offerings, a private placement, and stock purchase agreements with Takeda and Biogen.

Current wording

As of June 30, 2024, we had cash, cash equivalents and marketable securities in the amount of $1.35 billion. We fund our operations primarily with the proceeds from the sale of common stock and payments received from our collaboration partners, including those received under agreements with Takeda, Sanofi, and Biogen. We have sold common stock and other securities in public offerings, a private placement, and stock purchase agreements with Takeda and Biogen.

Previous wording

In February 2022, we established a registered “at-the-market” facility for the sale of up to $400.0 million of shares of common stock from time to time by entering into an equity distribution agreement with Goldman Sachs & Co. LLC, SVB Securities LLC and Cantor Fitzgerald & Co. as sales agents. To date, no shares have been sold under the equity distribution agreement.

Current wording

In February 2022, we established a registered “at-the-market” facility for the sale of up to $400.0 million of shares of common stock from time to time by entering into an equity distribution agreement with Goldman Sachs & Co. LLC, Leerink Partners LLC (formerly SVB Securities LLC) and Cantor Fitzgerald & Co. as sales agents. To date, no shares have been sold under the equity distribution agreement.

Previous wording

Pursuant to our collaboration and research funding agreements with Takeda, Sanofi, Biogen and an unrelated third party, through March 31, 2024 we have received upfront, option and milestone payments of$115.0 million,$225.0 million, $565.0 million and $12.5 million, respectively, and have also received$43.9 million and $16.2 million of gross cost sharing reimbursements from Takeda and Biogen, respectively, and received$13.7 million in specified reimbursements from Sanofi.

Current wording

Pursuant to our collaboration and research funding agreements with Takeda, Sanofi, Biogen and an unrelated third party, through June 30, 2024 we have received upfront, option and milestone payments of$115.0 million,$225.0 million, $565.0 million and $12.5 million, respectively, and have also received$45.8 million and $16.2 million of gross cost sharing reimbursements from Takeda and Biogen, respectively, and received$13.7 million in specified reimbursements from Sanofi.

Previous wording

Since our inception, we have incurred significant losses and negative cash flows from operations. We have an accumulated deficit of $1.22 billion through March 31, 2024. We expect to incur substantial additional losses in the future as we conduct and expand our research and development activities. We believe that our existing cash, cash equivalents and marketable securities will be sufficient to enable us to fund our projected operations through at least the twelve months following the filing date of this Quarterly Report on Form 10-Q, including our existing commitments as outlined below. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect. In the longer term, we anticipate that we will need substantial additional resources to fund our operations and meet future commitments.

Current wording

Since our inception, we have incurred significant losses and negative cash flows from operations. We have an accumulated deficit of $1.32 billion through June 30, 2024. We expect to incur substantial additional losses in the future as we conduct and expand our research and development activities. We believe that our existing cash, cash equivalents and marketable securities will be sufficient to enable us to fund our projected operations through at least the twelve months following the filing date of this Quarterly Report on Form 10-Q, including our existing commitments as outlined below. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect. In the longer term, we anticipate that we will need substantial additional resources to fund our operations and meet future commitments.

Previous wording

Our existing commitments primarily relate to our obligations under existing lease agreements, and certain clinical and manufacturing agreements, including the DMSA with Lonza Sales AG ("Lonza") for the development and manufacture of biologic products. As of March 31, 2024, operating lease liabilities were $50.5 million. Under the SLC lease which was executed in April 2023, we have future undiscounted lease payments totaling approximately $13.4 million. Under the DMSA with Lonza, and certain other clinical and manufacturing agreements, we had total non-refundable purchase commitments as of March 31, 2024 of $67.6 million, with certain amounts subject to cost sharing with Takeda. While the lease obligations span multiple years, the majority of the purchase commitments with Lonza and other clinical and manufacturing agreements are due within twelve months, with some spanning several years. These commitments are more fully described in Note 6 - Commitments and Contingencies of our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

Current wording

Our existing commitments primarily relate to our obligations under existing lease agreements, and certain clinical and manufacturing agreements, including the DMSA with Lonza Sales AG ("Lonza") for the development and manufacture of biologic products. As of June 30, 2024, operating lease liabilities were $48.8 million. Under the SLC lease which was executed in April 2023, we have future undiscounted lease payments totaling approximately $13.4 million. Under the DMSA with Lonza, and certain other clinical and manufacturing agreements, we had total non-refundable purchase commitments as of June 30, 2024 of $56.5 million, with certain amounts subject to cost sharing with Takeda. While the lease obligations span multiple years, the majority of the purchase commitments with Lonza and other clinical and manufacturing agreements are due within twelve months, with some spanning several years. These commitments are more fully described in Note 6 - Commitments and Contingencies of our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

Previous wording

During the three months ended March 31, 2024, net cash used in operating activities was $113.6 million, which consisted of a net loss of $101.8 million, adjusted by non-cash items primarily related to stock-based compensation expense, depreciation and amortization, net amortization of premiums and (discounts) on marketable securities, non-cash rent expenses, and the non-cash gain on divestiture of small molecule programs. Cash used in operating activities was also driven by changes in our operating assets and liabilities, the most significant of which was an increase in other non-current assets related to costs associated with the new Salt Lake City manufacturing facility during the three months ended March 31, 2024.

Current wording

During the six months ended June 30, 2024, net cash used in operating activities was $204.8 million, which consisted of a net loss of $200.8 million, adjusted by non-cash items primarily related to stock-based compensation expense, depreciation and amortization, net accretion of discounts on marketable securities, non-cash rent expenses, and the non-cash gain on divestiture of small molecule programs. Cash used in operating activities was also driven by changes in our operating assets and liabilities, the most significant of which was an increase in other non-current assets related to costs associated with the new Salt Lake City manufacturing facility during the six months ended June 30, 2024.

Previous wording

During the three months ended March 31, 2024, net cash used in investing activities was $453.2 million, which consisted of $834.2 million of purchases of marketable securities, partially offset by $383.1 million in proceeds from maturities and sales of marketable securities, and $2.2 million of capital expenditures to purchase property and equipment.

Current wording

During the six months ended June 30, 2024, net cash used in investing activities was $354.6 million, which consisted of $955.8 million of purchases of marketable securities and $6.9 million of capital expenditures to purchase property and equipment, partially offset by $608.1 million in proceeds from maturities and sales of marketable securities.

Previous wording

During the three months ended March 31, 2024, cash provided by financing activities was $500.3 million which consisted of $499.3 million of net proceeds from the sale of common stock and pre-funded warrants in a private placement in February 2024, as well as proceeds from the exercise of options to purchase common stock.

Current wording

During the six months ended June 30, 2024, cash provided by financing activities was $507.0 million which consisted of $499.3 million of net proceeds from the sale of common stock and pre-funded warrants in a private placement in February 2024, as well as proceeds from the exercise of options to purchase common stock and purchases of ESPP shares.

Previous wording

This discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported revenues recognized and expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Our significant accounting policies are described in detail in the notes to our consolidated financial statements included elsewhere in this report. In our “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 28, 2024, we described the accounting estimates that we believe involve a significant level of estimation uncertainty which could have a material impact on our financial condition or results of operations. There have been no material changes to these critical accounting estimates during the three months ended March 31, 2024.

Current wording

This discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported revenues recognized and expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Our significant accounting policies are described in detail in the notes to our consolidated financial statements included elsewhere in this report. In our “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 28, 2024, we described the accounting estimates that we believe involve a significant level of estimation uncertainty which could have a material impact on our financial condition or results of operations. There have been no material changes to these critical accounting estimates during the six months ended June 30, 2024.

Previous wording

There have been no new accounting pronouncements or changes to accounting pronouncements during the three months ended March 31, 2024, as compared to the recent accounting pronouncements described in our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 28, 2024, that are of significance or potential significance to us.

Current wording

There have been no new accounting pronouncements or changes to accounting pronouncements during the six months ended June 30, 2024, as compared to the recent accounting pronouncements described in our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 28, 2024, that are of significance or potential significance to us.