Zymeworks Inc.

Previous wording

We commenced operations in 2003 and have since devoted substantially all of our resources to research and development activities including developing our therapeutic platforms, identifying and developing potential product candidates and undertaking preclinical studies and clinical trials. Additionally, we have supported our research and development activities with general and administrative support, as well as by raising capital, conducting business planning and protecting our intellectual property. Other than the receipt of royalties on sales of zanidatamab and regulatory milestone payments relating to the regulatory approval of zanidatamab, we have not generated any revenue related to product approvals or the sale of approved products as of June 30, 2026. Other than the anticipated receipt of additional royalties and potential regulatory milestone payments relating to future regulatory decisions and sales of zanidatamab, we do not expect to generate any revenue related to product approvals or the sale of approved products until such time as we or our strategic partners’ obtain regulatory approval and commercialize one or more of our product candidates, or we acquire commercial products or sales revenue pursuant to a strategic transaction, such as our proposed acquisition of Theravance Biopharma, Inc. (“Theravance”) . We cannot be certain of the timing or success of approval of our product candidates.

Current wording

We commenced operations in 2003 and have since devoted our resources to research and development activities including developing our therapeutic platforms, identifying and developing potential product candidates and undertaking preclinical studies and clinical trials. Additionally, we have supported our research and development activities with general and administrative support, as well as by raising capital, entering into partnerships and collaborations, conducting business planning and protecting our intellectual property. Other than the receipt of royalties on sales of zanidatamab and potential regulatory milestone payments relating to future regulatory approvals of zanidatamab, we expect to generate revenue related to the sale of approved products and other commercial activities, including through our acquisition of Theravance Biopharma, Inc. (“Theravance”), which added commercial product sales of YUPELRI (revefenacin) and other revenue-generating assets, including VIBATIV (telavancin), to our business. We also expect to continue to receive royalties and milestone payments from existing and future strategic partners. Any future revenue from product candidates remains dependent on obtaining regulatory approval. We cannot be certain of the timing or success of approval of our product candidates.

Previous wording

Since our initial public offering (“IPO”) in 2017, we have funded our operations primarily through follow-on public offerings, and private placements including the issuance of pre-funded warrants, and payments received under our license and collaboration agreements, and non-recourse royalty financing. Payments received or receivables from our license and collaboration agreements include upfront fees, milestone and royalty payments, as well as research support and reimbursement payments. Prior to our IPO, we also received financing from private equity placements and the issuance of convertible debt, which was subsequently converted into equity securities, and a credit facility. From inception to June 30, 2026, we received $1,283.1 million, net of equity issuance costs, from these sources of financing including proceeds from exercises of stock options and employee stock purchase plans. As of June 30, 2026, we had $322.5 million of cash resources consisting of cash, cash equivalents and marketable securities.

Current wording

Since our initial public offering (“IPO”) in 2017, we have funded our operations primarily through follow-on public offerings, and private placements including the issuance of pre-funded warrants, and payments received under our license and collaboration agreements, and non-recourse financing arrangements secured by future royalty and other revenue streams. Payments received or receivable from our license and collaboration agreements include upfront fees, milestone and royalty payments, as well as research support and reimbursement payments. Prior to our IPO, we also received financing from private equity placements and the issuance of convertible debt, which was subsequently converted into equity securities, and a credit facility. From inception to September 30, 2026, we received $1,630.0 million, net of equity issuance costs, from these sources of financing including proceeds from exercises of stock options and employee stock purchase plans. In addition, since inception through September 30, 2026 we have also received an aggregate of $600.0 million from non-dilutive financing arrangements secured by future royalty and other revenue streams. As of September 30, 2026, we had $100.5 million of cash resources consisting of cash and cash equivalents and $413.9 million of accounts receivable, including a $250.0 million milestone receivable from Jazz Pharmaceuticals ("Jazz") related to the U.S. approval of Ziihera for GEA (defined below), which was subsequently collected in October 2026.

Previous wording

Although it is difficult to predict our funding requirements, based upon our current operating plan, we anticipate that our existing cash and cash equivalents and marketable securities as of June 30, 2026, will enable us to fund our operating expenditures and capital expenditure requirements for at least the next twelve months from the date of this Quarterly Report on Form 10-Q is filed with the SEC.

Current wording

Although it is difficult to predict our funding requirements, based upon our current operating plan, we anticipate that our existing cash and cash equivalents as of September 30, 2026, together with the $250.0 million Jazz milestone payment received in October 2026, will enable us to fund our operating expenditures and capital expenditure requirements for at least the next twelve months from the date this Quarterly Report on Form 10-Q is filed with the SEC.

Previous wording

We reported a net loss of $89.2 million for the six months ended June 30, 2026 and as of June 30, 2026, we had an accumulated deficit of $1,171.2 million. We expect to continue to incur operating losses in the near to medium term as we execute our strategic plan announced in 2025, which emphasizes disciplined capital allocation, focused research and development investment, advancement of partnered programs, and active management of our royalty and asset portfolio. Our operating expense outlook reflects a multi-year planning framework designed to align spending with defined strategic priorities, including pipeline progression, technology platform advancement, and value-enhancing business development activities. We are prioritizing investments where we believe risk-adjusted returns are most attractive and expect operating expenses to be managed within this structured framework.

Current wording

We reported net income of $84.5 million for the nine months ended September 30, 2026 and as of September 30, 2026, we had an accumulated deficit of $1,009.5 million. We anticipate that while we will be profitable for 2026, at least over the near to medium term we will not be consistently profitable on a quarterly basis as we execute our strategic plan announced in 2025, which emphasizes disciplined capital allocation, focused research and development investment, advancement of partnered programs, and active management of our royalty and asset portfolio. Our operating expense outlook reflects a multi-year planning framework designed to align spending with defined strategic priorities, including pipeline progression, technology platform advancement, and value-enhancing business development activities. We are prioritizing investments where we believe risk-adjusted returns are most attractive and expect operating expenses to be managed within this structured framework.

Previous wording

Through our asset and royalty aggregation strategy, we seek to optimize future cash flows from a growing portfolio of licensed products and product candidates, including Ziihera (zanidatamab-hrii) and pasritamig. As partnered therapies advance through late-stage development and commercialization, we expect to grow durable and predictable cash flows that can be deployed by us in order to seek attractive risk-adjusted returns for stockholders.

Current wording

Through our asset and royalty aggregation strategy, we seek to optimize future cash flows from a growing portfolio of licensed products and product candidates, including Ziihera (zanidatamab-hrii), YUPELRI (revefenacin), VIBATIV (telavancin) and pasritamig. As partnered therapies advance through late-stage development and commercialization, we expect to grow durable and predictable cash flows that can be deployed by us in order to seek attractive risk-adjusted returns for stockholders.

Previous wording

Zanidatamab, our first internally developed product candidate to receive regulatory approval, illustrates the execution of this partnership-based approach. Ziihera (zanidatamab-hrii), a bispecific antibody targeting HER2-expressing tumors developed using our Azymetric platform, has demonstrated positive late-stage clinical results and achieved regulatory approvals for the treatment of previously treated, unresectable or metastatic HER2-positive (“HER2+”) (IHC 3+) biliary tract cancer (“BTC”) in multiple jurisdictions including the United States, China, Europe and Canada. We have entered into separate collaboration and license agreements with BeOne Medicines Ltd. (formerly BeiGene, Ltd. and, together with its affiliates, “BeOne”) and Jazz Pharmaceuticals Ireland Limited, a subsidiary of Jazz Pharmaceuticals plc (collectively with their affiliates, “Jazz”), granting each partner exclusive rights to develop and commercialize zanidatamab in different territories. Jazz has completed the supplementary biologic license application (“sBLA”)submission for zanidatamab in the first quarter of 2026 for the treatment of first-line ("1L") HER2+ locally advanced or metastatic gastroesophageal adenocarcinoma (“GEA”) under the real-time oncology review program in the United States, where zanidatamab has been granted Breakthrough Therapy Designation for patients with HER2+ GEA. In April 2026, the U.S. Food and Drug Administration ("FDA") accepted the sBLA filing for Ziihera® (zanidatamab-hrii) combinations for the first-line treatment of adult patients with HER2+ unresectable locally advanced or metastatic gastric, gastroesophageal junction ("GEJ"), or GEA for priority review with a PDUFA date of August 25, 2026. In April 2026, BeOne announced that the U.S. FDA has granted Priority Review to a sBLA for TEVIMBRA® (tislelizumab) in combination with ZIIHERA® (zanidatamab) and chemotherapy for the first-line treatment of unresectable locally advanced/metastatic HER2+ gastric, gastroesophageal junction, or esophageal adenocarcinoma. In April 2026, BeOne also received acceptance for the filing of the sBLA for zanidatamab by the Center for Drug Evaluation of the China National Medical Products Administration (“NMPA”) to seek approval for zanidatamab for the first-line treatment for HER2+ locally advanced or metastatic GEA, including cancers of the stomach, gastroesophageal junction, and esophagus. Additionally, zanidatamab is currently being evaluated in multiple global clinical trials for treatment of broader HER2-expressing indications including early and late-line breast cancer and other HER2-expressing cancers. The U.S. FDA has also granted Breakthrough Therapy Designation for zanidatamab, for the treatment of adults with previously treated, locally advanced, unresectable, or metastatic HER2-positive colorectal cancer. Our partnerships with Jazz and BeOne reflect our strategy of advancing internally discovered programs through collaborations that share development ri…

Excerpt shortened here; the source contains the full paragraph.

Current wording

Zanidatamab, our first internally developed product candidate to receive regulatory approval, illustrates the execution of this partnership-based approach. Ziihera is a bispecific HER2-directed antibody that binds to two extracellular sites on HER2. Binding of zanidatamab-hrii with HER2 results in internalization leading to a reduction of the receptor on the tumor cell surface. We have entered into separate collaboration and license agreements with BeOne Medicines Ltd. (formerly BeiGene, Ltd. and, together with its affiliates, “BeOne”) and Jazz Pharmaceuticals Ireland Limited, a subsidiary of Jazz Pharmaceuticals plc (collectively with their affiliates, “Jazz”), granting each partner exclusive rights to develop and commercialize zanidatamab in different territories.

Previous wording

In addition to $53.0 million already received for regulatory approval of Ziihera in BTC, we are entitled to receive up to $440.0 million in near-term milestone payments from Jazz and BeOne related to approvals of Ziihera in GEA in the United States, Europe, Japan, and China as follows: U.S. - $250.0 million; EU - $100.0 million; Japan - $75.0 million; China - $15.0 million. We also expect that royalty revenue from Ziihera sales will increase as potential regulatory approvals are obtained in global markets for GEA.

Current wording

In addition to $303.0 million in milestones already earned for regulatory approval of Ziihera in BTC and GEA, we are entitled to receive up to $190.0 million in near-term milestone payments from Jazz and BeOne related to approvals of Ziihera in GEA in Europe, Japan, and China as follows: EU - $100.0 million; Japan - $75.0 million; China - $15.0 million. We also expect that royalty revenue from Ziihera sales will increase as potential additional regulatory approvals are obtained in global markets for GEA.

Previous wording

ZW251: A potential first-in-class clinical-stage ADC molecule designed for the treatment of glypican 3 (“GPC3”)-expressing hepatocellular carcinoma (“HCC”), incorporates the same Zymeworks proprietary bystander-active TOPO1i payload utilized in ZW191 (anti-FRα) and ZW220 (anti-NaPi2b), ZD06519. The GPC3-targeting monospecific antibody incorporated in ZW251 was selected based on favorable binding and internalization properties to enable targeting of a range of GPC3-expressing tumors. A DAR of four was selected for this program as a lower DAR potentially could unlock a broader range of dose levels, a potential benefit as HCC patients are commonly challenged by impairment of liver function as a result of chronic liver disease and cirrhosis. GPC3, a glycosylphosphatidylinositol-anchored cell surface oncofetal antigen, is over-expressed in most HCC patients (>75%), and displays minimal normal adult tissue expression, making it an appealing ADC target. In preclinical studies, anti-tumor activity for ZW251 was observed in multiple patient-derived xenograft models of HCC reflecting a range of GPC3 over-expression. In GLP toxicology studies performed in non-human primates, ZW251 achieved an HNSTD of 100 mg/kg, suggesting the potential for high doses in humans. We are encouraged by published research demonstrating the potential of targeting GPC3 with an antibody in HCC patients as evidenced by tumor localization of iodine radio-labeled condrituzumab, a clinical-stage anti-GPC3 monoclonal antibody, and believe that ADC-based targeting of GPC3 could enable a novel and effective approach to treatment of HCC. In July 2025, we announced that the investigational new drug (“IND”) application for ZW251 was cleared by the FDA. We are currently recruiting patients in an ongoing global Phase 1, open-label, multicenter study of ZW251, registered under NCT07164313 on clinicaltrials.gov. The study aims to enroll approximately 100 participants with advanced solid tumors, including HCC, squamous NSCLC, and germ cell tumors, across North America, Europe, and the Asia-Pacific region. The study is designed to evaluate the safety, tolerability, pharmacokinetics, and preliminary anti-tumor activity of ZW251.

Current wording

ZW251: A potential first-in-class clinical-stage ADC molecule designed for the treatment of glypican 3 (“GPC3”)-expressing hepatocellular carcinoma (“HCC”), incorporates the same Zymeworks proprietary bystander-active TOPO1i payload utilized in ZW191 (anti-FRα) and ZW220 (anti-NaPi2b), ZD06519. The GPC3-targeting monospecific antibody incorporated in ZW251 was selected based on favorable binding and internalization properties to enable targeting of a range of GPC3-expressing tumors. A DAR of four was selected for this program as a lower DAR potentially could unlock a broader range of dose levels, a potential benefit as HCC patients are commonly challenged by impairment of liver function as a result of chronic liver disease and cirrhosis. GPC3, a glycosylphosphatidylinositol-anchored cell surface oncofetal antigen, is over-expressed in most HCC patients (>75%), and displays minimal normal adult tissue expression, making it an appealing ADC target. In preclinical studies, anti-tumor activity for ZW251 was observed in multiple patient-derived xenograft models of HCC reflecting a range of GPC3 over-expression. In GLP toxicology studies performed in non-human primates, ZW251 achieved an HNSTD of 100 mg/kg, suggesting the potential for high doses in humans. We are encouraged by published research demonstrating the potential of targeting GPC3 with an antibody in HCC patients as evidenced by tumor localization of iodine radio-labeled condrituzumab, a clinical-stage anti-GPC3 monoclonal antibody, and believe that ADC-based targeting of GPC3 could enable a novel and effective approach to treatment of HCC. In July 2025, we announced that the investigational new drug (“IND”) application for ZW251 was cleared by the FDA. We are currently recruiting patients in an ongoing global Phase 1, open-label, multicenter study of ZW251, registered under NCT07164313 on clinicaltrials.gov. The study aims to enroll approximately 140 participants with advanced solid tumors, including HCC, squamous NSCLC, and germ cell tumors, across North America, Europe, and the Asia-Pacific region. The study is designed to evaluate the safety, tolerability, pharmacokinetics, and preliminary anti-tumor activity of ZW251.

Previous wording

ZW209: A novel TriTCE targeting Delta-like ligand 3 (“DLL3”)-expressing tumor cells, is designed using our clinically validated Azymetric and EFECT platforms. By leveraging obligate cis-T cell binding and conditional cluster of differentiation 28 (“CD28”) engagement, this potentially first-in-class molecule has been designed to prevent unintended T cell activation, while enabling tumor-targeted cytotoxicity. The innovative design has demonstrated differentiated long-term cytotoxicity in vitro at low E:T (effector to target) ratios, with enhanced T cell proliferation and survival, offering significant potential to increase durability of responses in DLL3-expressing cancers. We anticipate submitting an IND to commence Phase 1 clinical studies for ZW209 in 2026, with equivalent non-U.S. applications to be submitted thereafter.

Current wording

ZW209: A novel TriTCE targeting Delta-like ligand 3 (“DLL3”)-expressing tumor cells, is designed using our clinically validated Azymetric and EFECT platforms. By leveraging obligate cis-T cell binding and conditional cluster of differentiation 28 (“CD28”) engagement, this potentially first-in-class molecule has been designed to prevent unintended T cell activation, while enabling tumor-targeted cytotoxicity. The innovative design has demonstrated differentiated long-term cytotoxicity in vitro at low E:T (effector to target) ratios, with enhanced T cell proliferation and survival, offering significant potential to increase durability of responses in DLL3-expressing cancers. ZW209 has received Investigational New Drug clearance from the U.S. FDA. We anticipate initiating a Phase 1, open-label, multicenter, global study investigating ZW209 in collaboration with Roche to evaluate safety, tolerability, pharmacokinetics, and preliminary antitumor activity, subject to the expiration or termination of the waiting period under the Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976. See "Recent Developments - ZW209" below.

Previous wording

With respect to our ADC portfolio, we currently expect to continue conducting Phase 1 clinical studies for ZW191 and ZW251 during 2026. We may pursue additional clinical development of our pan-RASi ADCs; ZW220, ZW327, and ZW418, only if and when partnerships, collaborations, spin-out formation, and/or other sources of external funding become available.

Current wording

With respect to our ADC portfolio, we currently expect to continue conducting Phase 1 clinical studies for ZW191 and ZW251 during 2026. We may pursue additional clinical development of our TOPO1i ADC's or pan-RASi ADCs; ZW220, ZW327, and ZW418, only if and when partnerships, collaborations, spin-out formation, and/or other sources of external funding become available. We are currently in discussions with third parties with respect to certain of the foregoing candidates.

Previous wording

We intend to continue innovating with increased novelty in targets and unique mechanisms of action through bispecific or biparatopic ADCs, dual-payload ADCs, multi-specific immune cell engagers and immune-oncology, subject to strategic priorities, and the availability of resources.

Current wording

We have the ability to continue innovating with increased novelty in targets and unique mechanisms of action through bispecific or biparatopic ADCs, dual-payload ADCs, multi-specific immune cell engagers and immune-oncology, subject to strategic priorities, and the availability of resources.

Previous wording

Our royalty revenue from Jazz and BeOne was $1.8 million in the three months ended June 30, 2026, driven primarily by net product sales of Ziihera® by Jazz in the three months ended June 30, 2026.

Current wording

•Royalty revenue from Jazz Pharmaceuticals and BeOne Medicines was $2.3 million in the three months ended September 30, 2026, driven primarily by net product sales of Ziihera by Jazz in the United States.

Previous wording

On November 16, 2025, our board of directors approved a program pursuant to which the Company was authorized to repurchase, from time to time, up to $125.0 million worth of its outstanding common stock (the “2025 Repurchase Program”). As of May 13, 2026, the Company had utilized approximately $102.3 million of the 2025 Repurchase Program to acquire 4,197,553 shares at an average price of 24.36 per share (exclusive of commission expense and estimated excise tax).

Current wording

•On November 16, 2025, our board of directors approved a program pursuant to which the Company was authorized to repurchase, from time to time, up to $125.0 million worth of its outstanding common stock (the “2025 Repurchase Program”). As of May 13, 2026, the Company had utilized $102.3 million of the 2025 Repurchase Program to acquire 4,197,553 shares at an average price of $24.36 per share (exclusive of commission expense and estimated excise tax).

Previous wording

On May 14, 2026, we terminated the 2025 Repurchase Program and our board of directors authorized a new share repurchase program providing the ability to repurchase up to $125.0 million in shares of our common stock (the “2026 Repurchase Program”). Through August 4, 2026, we have repurchased 1,971,454 common shares for $49.4 million at an average price per share of $25.04 (exclusive of commission expense and estimated excise tax) under our current 2026 Repurchase Program.

Current wording

•On May 14, 2026, we terminated the 2025 Repurchase Program and our board of directors authorized a new share repurchase program providing the ability to repurchase up to $125.0 million in shares of our common stock (the “2026 Repurchase Program”). Through November 6, 2026, we have repurchased 4,340,965 common shares for $115.6 million at an average price per share of $26.63 (exclusive of commission expense and estimated excise tax) under our current 2026 Repurchase Program.

Previous wording

Since initiating its share repurchase program in August 2024, the Company has cumulatively utilized $213.6 million to reacquire 10,571,316 shares at an average price of $20.21 per share (exclusive of commission expense and estimated excise tax). As of August 4, 2026, the Company had approximately 71.0 million common shares outstanding.

Current wording

•Since initiating its share repurchase program in August 2024, the Company has cumulatively utilized $279.8 million to reacquire 12,940,827 shares at an average price of $21.63 per share (exclusive of commission expense and estimated excise tax). As of November 6, 2026, the Company had approximately 69.0 million common shares outstanding.

Previous wording

Through collaboration agreements with Jazz and BeOne relating to our programs for zanidatamab and zanidatamab zovodotin, we have received an aggregate of $491.0 million through June 30, 2026 in the form of non-refundable upfront payments and milestone payments. In addition, through these partnerships with Jazz and BeOne with respect to zanidatamab, as of June 30, 2026, we remain eligible to receive up to $1.51 billion in potential regulatory, development and commercial milestone payments, as well as tiered royalties on potential future product sales, pending receipt of applicable regulatory approvals. Under our collaboration agreement with Jazz, we are eligible to receive tiered royalties of ten to high teens percentages on global (outside of Asia (other than Japan), Australia and New Zealand) annual net sales of Ziihera up to $2.0 billion and 20% on annual net sales above $2.0 billion. Under the collaboration agreement with BeOne, we are eligible to receive tiered royalties of mid-single to mid-double digit percentages on annual net sales of Ziihera in Asia (other than Japan), Australia and New Zealand up to $1.0 billion and 19.5% on annual net sales above $1.0 billion (with royalty rates increasing by 0.5% when cumulative amounts forgone as a result of a royalty reduction of 0.5% reaches a cap in the low double-digit millions of dollars).

Current wording

Through collaboration agreements with Jazz Pharmaceuticals and BeOne Medicines relating to our programs for zanidatamab and zanidatamab zovodotin, we have received an aggregate of $491.0 million through September 30, 2026 in the form of non-refundable upfront payments and milestone payments, excluding the $250.0 million milestone related to Ziihera's U.S. approval for GEA received in October 2026. In addition, through these partnerships with Jazz Pharmaceuticals and BeOne Medicines with respect to zanidatamab, as of September 30, 2026, we remain eligible to receive up to $1.51 billion in potential regulatory, development and commercial milestone payments, including the $250.0 million milestone related to Ziihera's U.S. approval for GEA, as well as tiered royalties on potential future product sales, pending receipt of applicable regulatory approvals. Under our collaboration agreement with Jazz Pharmaceuticals, we are eligible to receive tiered royalties of ten to high teens percentages on global (outside of Asia (other than Japan), Australia and New Zealand) annual net sales of Ziihera up to $2.0 billion and 20% on annual net sales above $2.0 billion. Under the collaboration agreement with BeOne Medicines, we are eligible to receive tiered royalties of mid-single to mid-double digit percentages on annual net sales of Ziihera in Asia (other than Japan), Australia and New Zealand up to $1.0 billion and 19.5% on annual net sales above $1.0 billion (with royalty rates increasing by 0.5% when cumulative amounts forgone as a result of a royalty reduction of 0.5% reaches a cap in the low double-digit millions of dollars).

Previous wording

The information included in the table below presents a summary of key aspects of our collaboration and licensing agreements as of June 30, 2026.

Current wording

The information included in the table below presents a summary of key aspects of our collaboration and licensing agreements as of November 9, 2026, excluding the recent collaboration agreement with Roche for the development of ZW209, which is subject to the expiration or termination of the waiting period under the HSR Antitrust Improvements Act of 1976, expected during the fourth quarter of 2026.

Previous wording

In addition to the payments we have received through our collaboration agreements with Jazz and BeOne relating to zanidatamab and zanidatamab zovodotin, as of June 30, 2026, we have received $233.4 million in the form of non-refundable upfront and milestone payments from platform partnership and collaboration agreements. We continue to have revenue-generating strategic partnerships and collaborations with respect to our Azymetric and EFECT therapeutic platforms with the following pharmaceutical companies: GSK, Daiichi Sankyo, J&J, and Merck. As of June 30, 2026, we remain eligible to receive up to $0.78 billion in preclinical and development milestone payments and up to $2.97 billion in commercial milestone payments, as well as tiered royalties on potential future product sales, pending regulatory approval. It is possible, however, that our strategic partners’ programs will not advance as currently contemplated, which would negatively affect the amount of development and commercial milestone payments and royalties on potential future product sales we may receive. Importantly, these partnerships include predominantly non-target-exclusive licenses for any of our therapeutic platforms, so we maintain the ability to develop therapeutics directed to many high-value targets using our platforms. As of April 30, 2026, Celgene Corporation and Celgene Alpine Investment Co. LLC (now a Bristol-Myers Squibb company) has discontinued development of its remaining program under our collaboration agreement. For further information on the terms and conditions of our existing collaboration and license agreements, please refer to “Item 1. Business - Strategic Partnerships and Collaborations” of our Annual Report on Form 10-K for the year ended December 31, 2025.

Current wording

In addition to the payments we have received through our collaboration agreements with Jazz Pharmaceuticals and BeOne Medicines relating to zanidatamab and zanidatamab zovodotin, as of September 30, 2026, we have received $233.4 million in the form of non-refundable upfront and milestone payments from platform partnership and collaboration agreements. We continue to have revenue-generating strategic partnerships and collaborations with respect to our Azymetric and EFECT therapeutic platforms with the following pharmaceutical companies: GSK, Daiichi Sankyo, J&J, and Merck. As of September 30, 2026, we remain eligible to receive up to $0.78 billion in preclinical and development milestone payments and up to $2.97 billion in commercial milestone payments, as well as tiered royalties on potential future product sales, pending regulatory approval. It is possible, however, that our strategic partners’ programs will not advance as currently contemplated, which would negatively affect the amount of development and commercial milestone payments and royalties on potential future product sales we may receive. Importantly, these partnerships include predominantly non-target-exclusive licenses for any of our therapeutic platforms, so we maintain the ability to develop therapeutics directed to many high-value targets using our platforms. As of April 30, 2026, Celgene Corporation and Celgene Alpine Investment Co. LLC (now a Bristol-Myers Squibb company) has discontinued development of its remaining program under our collaboration agreement. For further information on the terms and conditions of our existing collaboration and license agreements, please refer to “Item 1. Business - Strategic Partnerships and Collaborations” of our Annual Report on Form 10-K for the year ended December 31, 2025.

Previous wording

Our revenue consists of collaboration revenue, including amounts recognized relating to upfront non-refundable payments for licenses or options to obtain future licenses, research and development funding, milestone payments and royalties earned under collaboration and license agreements. We expect that collaboration revenue from our strategic partnerships will be our primary source of revenue for the foreseeable future.

Current wording

Our revenue consists of collaboration revenue, including amounts recognized relating to upfront non-refundable payments for licenses or options to obtain future licenses, research and development funding, milestone payments and royalties earned under collaboration and license agreements. We expect future revenue to be derived from a combination of milestone payments, royalties, profit-share arrangements and collaboration revenue generated through our strategic partnerships and commercial assets.

Previous wording

Our operating expenses consist primarily of research and development expenses and general and administrative expenses. Personnel costs, including salaries, benefits, bonuses and stock-based compensation expense, comprise a significant component of research and development and general and administrative expenses. We allocate certain indirect expenses associated with our facilities, information technology, depreciation and other overhead costs between research and development and general and administrative categories based on employee headcount and the nature of work performed by each employee.

Current wording

Our operating expenses consist primarily of research and development expenses and selling, general and administrative expenses. Personnel costs, including salaries, benefits, bonuses and stock-based compensation expense, comprise a significant component of research and development and selling, general and administrative expenses. We allocate certain indirect expenses associated with our facilities, information technology, depreciation and other overhead costs between research and development and selling, general and administrative categories based on employee headcount and the nature of work performed by each employee.

Previous wording

It is difficult to determine with certainty the duration and completion costs of our current or future clinical trials and preclinical programs of our product candidates, or if, when or to what extent we will generate revenue other than zanidatamab royalties from the commercialization and sale of any of our product candidates that obtain regulatory approval. We or our strategic partners may never succeed in achieving regulatory approval for any of our current or future product candidates. The duration, costs and timing of clinical trials and development of our product candidates will depend on a variety of factors, including the uncertainties of clinical trials and preclinical studies, uncertainties in clinical trial enrollment rates and significant and changing government regulation. In addition, the probability of success for each product candidate will depend on numerous factors, including competition, manufacturing capability and commercial viability. We will determine which programs to pursue and how much to fund each program in response to the scientific and clinical success of each product candidate, as well as an assessment of each product candidate’s commercial potential. As part of our recently announced strategy, we will continue to seek out partnerships and collaborations. If we are successful, over the next several years, we anticipate that our annual research and development expenses, excluding stock-based compensation expense, will trend lower.

Current wording

It is difficult to determine with certainty the duration and completion costs of our current or future clinical trials and preclinical programs of our product candidates, or if, when or to what extent we will generate revenue other than zanidatamab royalties from the commercialization and sale of any of our product candidates that obtain regulatory approval. We or our strategic partners may never succeed in achieving regulatory approval for any of our current or future product candidates. The duration, costs and timing of clinical trials and development of our product candidates will depend on a variety of factors, including the uncertainties of clinical trials and preclinical studies, uncertainties in clinical trial enrollment rates and significant and changing government regulation. In addition, the probability of success for each product candidate will depend on numerous factors, including competition, manufacturing capability and commercial viability. We will determine which programs to pursue and how much to fund each program in response to the scientific and clinical success of each product candidate, as well as an assessment of each product candidate’s commercial potential. As part of our strategic plan announced in 2025, we will continue to seek out partnerships and collaborations. If we are successful, over the next several years, we anticipate that our annual research and development expenses, excluding stock-based compensation expense, will trend lower.

Previous wording

General and administrative expenses consist of salaries, benefits and stock-based compensation costs for employees in our executive, finance, legal, intellectual property, business development, human resources and other support functions, as well as legal and professional fees, business insurance, facilities and information technology costs and other expenses. We anticipate over the next several years that our annual general and administrative expenses, other than stock-based compensation expense, will trend lower as we continue to pursue our strategic plan.

Current wording

Selling, general and administrative expenses consist of salaries, benefits and stock-based compensation costs for employees in our executive, finance, legal, intellectual property, business development, human resources and other support functions, as well as legal and professional fees, business insurance, facilities and information technology costs, acquisition-related transaction costs, and other expenses. We anticipate opportunities to realize efficiencies in certain selling, general and administrative functions over time. However, future expense levels will depend on the pace and complexity of integration activities, commercialization efforts and other strategic initiatives..

Previous wording

There have been no material changes in our critical accounting policies and significant judgments and estimates during the three and six months ended June 30, 2026 as compared to what has been described in our most recent annual consolidated financial statements, other than the application of existing accounting policies to the royalty monetization transaction and the issuance of performance stock units, as well as capitalized deferred financing costs related to pending debt financing, as described in note 2 of our interim condensed consolidated financial statements for the quarter ended June 30, 2026 within this Quarterly Report on Form 10-Q.

Current wording

There have been no material changes in our critical accounting policies and significant judgments and estimates during the three and nine months ended September 30, 2026 as compared to what has been described in our most recent annual consolidated financial statements, other than the application of existing accounting policies to the liability related to the sale of future revenue arrangements, the issuance of performance stock units and the accounting for the acquisition of Theravance, as described in Note 2 of our interim condensed consolidated financial statements for the quarter ended September 30, 2026 within this Quarterly Report on Form 10-Q.

Previous wording

Results of Operations for the Three and Six Months Ended June 30, 2026 and 2025

Current wording

Results of Operations for the Three and Nine Months Ended September 30, 2026 and 2025

Previous wording

Total revenue decreased by $68.8 million in the six months ended June 30, 2026 compared to the same period in 2025. The decrease was driven primarily by the absence of significant non-recurring collaboration revenue recognized in 2026, including a $20.0 million development milestone from BeOne, $18.3 million of deferred revenue recognized in connection with the amended ZW25 license agreement and termination of the ZW49 agreement, development milestones of $14.0 million from GSK and $3.1 million from Daiichi Sankyo, and a $7.5 million option exercise fee from Bristol Myers Squibb, all of which were recognized in 2025. In addition, revenue declined due to lower development support and drug supply revenue from Jazz, reflecting the transition of responsibility for certain zanidatamab clinical activities to Jazz under our amended agreements. These decreases were slightly offset by higher royalty revenue from Jazz and BeOne in 2026. Royalty revenue from Jazz and BeOne is expected to increase over time as commercial sales of Ziihera increase.

Current wording

Total revenue increased by $160.0 million in the nine months ended September 30, 2026 compared to the same period in 2025. The increase was driven primarily by the $250.0 million milestone from Jazz triggered by Ziihera's U.S. approval for GEA. This increase was partially offset by the absence of significant non-recurring collaboration revenue recognized in 2025, including a $25.0 million development milestone from J&J, a $20.0 million development milestone from BeOne, and other milestone and licensing revenues recognized from GSK, Daiichi Sankyo, Bristol Myers Squibb and deferred revenue recognized in connection with the amended ZW25 license agreement and termination of the ZW49 agreement. In addition, development support and drug supply revenue from Jazz declined, reflecting the transition of responsibility for certain zanidatamab clinical activities to Jazz under our amended agreements. Royalty revenue from Jazz and BeOne increased in 2026 and is expected to continue to increase over time as commercial sales of Ziihera grow.

Previous wording

Research and development expense decreased by $8.3 million for the six months ended June 30, 2026 compared to the same period in 2025. The decrease was driven primarily by lower third-party research and development program expenses, largely due to reduced spending on ZW171 following the discontinuation of the program in 2025 and lower spending on ZW220 following the completion of certain IND-enabling activities in 2025. Spending on ZW251 also decreased compared to the prior-year period, as higher costs incurred for IND-enabling activities in 2025 exceeded ongoing clinical trial costs in 2026. Lower spending on earlier-stage preclinical and research programs, including ZW209, also contributed to the decrease. These decreases were partially offset by higher spending on ZW191 associated with the progression of ongoing clinical studies.

Current wording

Research and development expense decreased by $7.8 million for the nine months ended September 30, 2026, compared to the same period in 2025. The decrease was driven primarily by lower third-party research and development program expenses, largely due to reduced activity on ZW171 following the discontinuation of the program in 2025 and ZW220 following the completion of certain IND-enabling activities in 2025. Lower spending on earlier-stage preclinical and research programs, including ZW209 and ZW1528, also contributed to the decrease. These decreases were partially offset by higher stock-based compensation expense, largely related to the settlement of Theravance equity awards attributable to post-combination service and a one-time charge related to specialized zanidatamab manufacturing materials following a reassessment of expected future recoverability.

Previous wording

General and administrative expense increased by $4.3 million for the three months ended June 30, 2026 compared to the same period in 2025. The increase was driven primarily by higher non-cash stock-based compensation expense resulting from equity awards granted in 2026, including awards granted in connection with executive leadership transitions, higher grant date fair values associated with an increase in our stock price, and the introduction of performance-based equity awards. The increase also reflects professional fees incurred in connection with the proposed Theravance acquisition. These increases were partially offset by lower software amortization and software subscription expenses following the completion of a significant enterprise systems transition.

Current wording

Selling, general and administrative expense increased by $28.6 million for the three months ended September 30, 2026 compared to the same period in 2025. The increase was driven primarily by costs associated with the Theravance acquisition, including severance and transaction-related professional fees, together with higher stock-based compensation expense. The increase in stock-based compensation expense was driven by equity awards granted in 2026, including awards granted in connection with executive leadership transitions, higher grant date fair values associated with an increase in the Company's stock price, the introduction of performance-based equity awards, and the settlement of certain Theravance equity awards attributable to post-combination service.

Previous wording

General and administrative expense increased by $2.5 million for the six months ended June 30, 2026 compared to the same period in 2025. The increase was driven primarily by higher non-cash stock-based compensation expense resulting from equity awards granted in 2026, including awards granted in connection with executive leadership transitions, higher grant date fair values associated with an increase in our stock price, and the introduction of performance-based equity awards. The increase also reflects higher salaries and benefits, including severance-related expenses associated with previously disclosed leadership transitions recognized during the period. These increases were partially offset by lower software amortization and software subscription expenses following the completion of a significant enterprise systems transition.

Current wording

Selling, general and administrative expense increased by $31.0 million for the nine months ended September 30, 2026 compared to the same period in 2025. The increase was driven primarily by severance and transaction-related professional fees incurred in connection with the Theravance acquisition, together with higher stock-based compensation expense. The increase in stock-based compensation expense was driven by equity awards granted in 2026, including awards granted in connection with executive leadership transitions, higher grant date fair values associated with an increase in the Company's stock price, the introduction of performance-based equity awards, and the settlement of certain Theravance equity awards attributable to post-combination service. Salaries and benefits also increased due to severance and other personnel-related costs associated with previously disclosed leadership transitions. These increases were partially offset by lower facility and technology costs following completion of the Company's enterprise systems transition.

Previous wording

Other income, net decreased by $5.9 million for the three months ended June 30, 2026 compared to the same period in 2025, primarily due to interest expense related to the Loan Agreement with Royalty Pharma executed in March 2026, partially offset by interest income earned on cash, cash equivalents and marketable securities.

Current wording

Other (expense) income, net decreased by $8.2 million for the three months ended September 30, 2026 compared to the same period in 2025, primarily due to interest expense related to the Loan Agreement with Royalty Pharma executed in March 2026 and lower interest income earned on cash, cash equivalents and marketable securities, reflecting lower average cash and investment balances during 2026.

Previous wording

Other income, net decreased by $8.6 million for the six months ended June 30, 2026 compared to the same period in 2025, primarily due to interest expense related to the Loan Agreement with Royalty Pharma executed in March 2026, partially offset by interest income earned on cash, cash equivalents and marketable securities.

Current wording

Other (expense) income, net decreased by $16.8 million for the nine months ended September 30, 2026 compared to the same period in 2025, primarily due to interest expense related to the Loan Agreement with Royalty Pharma executed in March 2026 and lower interest income earned on cash, cash equivalents and marketable securities, reflecting lower average cash and investment balances during 2026.

Previous wording

Income tax expense decreased by $2.8 million for the three months ended June 30, 2026, compared to the same period in 2025. The change for the three month period ending June 30, 2026 is prima rily due to the tax benefit associated with changes in undistributed earnings of foreign subsidiaries during the reporting period.

Current wording

Income tax expense decreased by $4.5 million for the nine months ended September 30, 2026, compared to the same period in 2025. The decrease was primarily due to the tax benefit associated with changes in undistributed earnings of foreign subsidiaries during the reporting period, a reduction of the US income tax effects of foreign operations, and changes in the Company's jurisdictional mix of earnings.

Previous wording

Since our IPO in 2017, we have funded our operations primarily through follow-on public offerings and private placements (including the issuance of pre-funded warrants), loans, as well as from upfront fees, milestone payments, and research support payments generated from our strategic collaborations and licensing agreements. As part of our previously announced asset and royalty aggregation strategy, we anticipate that funds used in operations will increasingly be derived from royalty and milestone payments that we receive through our strategic collaboration and licensing agreements. We also evaluate other sources of capital to finance our operations, including through debt financings, asset monetizations, strategic partnerships, grant funding, and public and private equity offerings.

Current wording

Since our IPO in 2017, we have funded our operations primarily through follow-on public offerings and private placements (including the issuance of pre-funded warrants), strategic collaboration and licensing agreements, and non-recourse financing arrangements secured by future royalty and other revenue streams. Since we closed our public equity offering in January 2022, our primary source of funding for operations has been driven by strategic collaboration and licensing agreements and non-recourse financing arrangements secured by future royalty and other revenue streams. Payments received or receivable under our collaboration and licensing agreements include upfront fees, milestone payments, royalties, profit-share arrangements, research support payments and other commercial revenue. As part of our previously announced asset and royalty aggregation strategy, we anticipate that funds used in operations will increasingly be derived from recurring royalty, profit-share and milestone revenue streams. We also continue to evaluate other sources of capital to finance our operations, including through debt financings, asset monetizations, strategic partnerships, grant funding, and public and private equity offerings.

Previous wording

The following table represents a summary of our cash flows for the six months ended June 30, 2026 and 2025:

Current wording

The following table represents a summary of our cash flows for the nine months ended September 30, 2026 and 2025:

Previous wording

During the six months ended June 30, 2026, cash used in operating activities was $77.7 million compared to $8.7 million of cash provided by operating activities for the same period in 2025. Net cash generated in operating activities in 2025 was primarily due to milestone revenues and favorable movements in working capital in 2025.

Current wording

During the nine months ended September 30, 2026, cash used in operating activities was $101.7 million compared to $22.7 million of cash used in operating activities for the same period in 2025. Net cash used in operating activities in 2025 was primarily due to unfavorable movements in working capital in 2025 compared to same period in 2026.

Previous wording

Net cash provided by investing activities for the six months ended June 30, 2026 primarily related to net proceeds from marketable securities of $87.2 million partially offset by cash outflows of $0.2 million for expenditures for office equipment and software implementation. Net cash provided by investing activities for the same period in 2025 primarily related to net proceeds from marketable securities of $22.1 million partially offset by cash outflows of $1.2 million for expenditures related to software implementation.

Current wording

Net cash used in investing activities for the nine months ended September 30, 2026 primarily related to the payment of $532.0 million in relation to our acquisition of Theravance, partially offset by net proceeds from sale of marketable securities of $229.6 million. Net cash provided by investing activities for the same period in 2025 primarily related to net proceeds from marketable securities of $22.9 million partially offset by cash outflows of $1.6 million for expenditures related to software implementation and office hardware.

Previous wording

Net cash provided by financing activities for the six months ended June 30, 2026 included net proceeds of $244.7 million related to the Loan Agreement with Royalty Pharma, $11.6 million from stock option exercises and $0.6 million from the issuance of shares of common stock under our employee stock purchase plan. These were partially offset by $128.1 million used for the 2025 and 2026 Repurchase Programs. Net cash used in financing activities for the same period in 2025 included net proceeds of $2.2 million from stock option exercises and $0.5 million from the issuance of shares of common stock under our employee stock purchase plan.

Current wording

Net cash provided by financing activities for the nine months ended September 30, 2026 included net proceeds of $588.6 million from the financing arrangements with Royalty Pharma and OMERS, to finance our acquisition of Theravance, $14.3 million from stock option exercises and $0.8 million from the issuance of shares of common stock under our employee stock purchase plan. These inflows were partially offset by $140.1 million used to repurchase shares of our common stock. Net cash provided by financing activities for the same period in 2025 included net proceeds of $5.0 million from a private placement, $10.1 million from stock option exercises and $1.4 million from the issuance of shares of common stock under our employee stock purchase plan. These inflows were partially offset by $16.2 million used for the 2025 Repurchase Program.

Previous wording

Although it is difficult to predict our funding requirements, based on our current operating plan, we anticipate that our existing cash and cash equivalents and marketable securities will enable us to fund our operating expenses and capital expenditure requirements for at least the next twelve months from the date this Quarterly Report on Form 10-Q is filed with the SEC. This assessment excludes the receipt of potential future milestone payments from strategic partners or the completion of contingent financing, acquisition or other strategic transactions. As we continue our transition toward a revenue-generating business supported by royalty, profit-share and other recurring cash flow streams, we no longer intend to focus on cash runway measures. We have based our expectations on assumptions and plans which may change and which could impact the magnitude and/or timing of operating expenses, capital expenditures and our cash flows. The successful development of our product candidates and the achievement of milestones by our strategic partners is uncertain. As a result of the foregoing, it is difficult to predict the actual funds we will require to fund our planned operations. See Part II, Item 1A, “Risk Factors – Risks Relating to Our Business,” “Risk Factors – Risks Relating to Development of our Product Candidates,” and “Risk Factors –Risks Related to Our Financial Position and Need for Additional Capital.”

Current wording

Although it is difficult to predict our funding requirements, based on our current operating plan, we anticipate that our existing cash and cash equivalents, including the $250.0 million Jazz milestone payment received in October 2026, will enable us to fund our operating expenses and capital expenditure requirements for at least the next twelve months from the date this Quarterly Report on Form 10-Q is filed with the SEC. This assessment excludes the receipt of potential future milestone payments from strategic partners because such payments remain contingent upon future development, regulatory and/or commercial events and the timing and receipt of such payments cannot be assured, or the completion of contingent financing, acquisition or other strategic transactions. As we continue our transition toward a revenue-generating business supported by royalty, profit-share and other recurring cash flow streams, we no longer intend to focus on cash runway measures. We have based our expectations on assumptions and plans which may change and which could impact the magnitude and/or timing of operating expenses, capital expenditures and our cash flows. The successful development of our product candidates and the achievement of milestones by our strategic partners is uncertain. As a result of the foregoing, it is difficult to predict the actual funds we will require to fund our planned operations. See Part II, Item 1A, “Risk Factors – Risks Relating to Our Business,” “Risk Factors – Risks Relating to Development of our Product Candidates,” and “Risk Factors –Risks Related to Our Financial Position and Need for Additional Capital.”

Previous wording

Additionally, on August 1, 2024, our board of directors authorized the 2024 Repurchase Program, under which we were authorized to repurchase up to $60.0 million of our common stock. As of November 10, 2025, we completed the entire $60.0 million of the 2024 Repurchase Program. On November 16, 2025, our board of directors authorized the 2025 Repurchase Program, whereby we were authorized to repurchase up to $125.0 million of our outstanding common stock. On May 14, 2026, we terminated the 2025 Repurchase Program and our board of directors authorized the 2026 Repurchase Program providing the ability to repurchase up to $125.0 million in shares of our common stock. We repurchased 4,197,553 shares of our common stock under the 2025 Repurchase Program until its termination in 2026. As of August 4, 2026, we have repurchased 1,971,454 shares of our common stock under the 2026 Repurchase Program, and there is $75.6 million of remaining capacity under the 2026

Current wording

Additionally, on August 1, 2024, our board of directors authorized the 2024 Repurchase Program, under which we were authorized to repurchase up to $60.0 million of our common stock. As of November 10, 2025, we completed the entire $60.0 million of the 2024 Repurchase Program. On November 16, 2025, our board of directors authorized the 2025 Repurchase Program, whereby we were authorized to repurchase up to $125.0 million of our outstanding common stock. On May 14, 2026, we terminated the 2025 Repurchase Program and our board of directors authorized the 2026 Repurchase Program providing the ability to repurchase up to $125.0 million in shares of our common stock. We repurchased 4,197,553 shares of our common stock under the 2025 Repurchase Program until its termination in 2026. As of November 6, 2026, we have repurchased 4,340,965 shares of our common stock under the 2026 Repurchase Program, and there is $9.4 million of remaining capacity under the 2026 Repurchase Program. The shares may be repurchased from time to time in open market transactions, or other means in accordance with Rule 10b5-1 of the Exchange Act and Rule 10b-18 of the Exchange Act. The timing, number of shares repurchased, and prices paid for any additional shares of the stock repurchased under this program will depend on general business and market conditions as well as corporate and regulatory limitations, prevailing stock prices, and other considerations. The 2026 Repurchase Program may be suspended or discontinued at any time and does not obligate us to acquire any additional shares of common stock.

Previous wording

We will need substantial additional funding to support our continuing operations and pursue our long-term business plans. Accordingly, our future funding requirements will depend on many factors, including but not limited to:

Current wording

While our existing resources are expected to support our current operating plan, execution of our long-term strategy and future business development opportunities may require additional capital over time. Accordingly, our future funding requirements will depend on many factors, including but not limited to:

Previous wording

•the economic and other terms, timing of and success of our existing strategic partnerships, and any collaboration, asset monetization, licensing, or other arrangements into which we may enter in the future, including the timing of receipt of any milestone or royalty payments under these agreements.

Current wording

•the economic and other terms, timing of and success of our existing strategic partnerships, and any collaboration, asset monetization, licensing, or other arrangements into which we may enter in the future, including the timing of receipt of any milestone, profit-share or royalty payments under these agreements.