Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)

Management's Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and the related notes and other financial information included elsewhere in this Annual Report on Form 10-K. This discussion and analysis and other parts of this Annual Report on Form 10-K contain forward-looking statements based upon current beliefs, plans and expectations related to future events and our future financial performance that involve risks, uncertainties and assumptions, such as statements regarding our intentions, plans, objectives and expectations for our business. Our actual results and the timing of selected events could differ materially from those described in or implied by these forward-looking statements as a result of several factors, including those set forth under Part I, Item 1A. "Risk Factors" in this Annual Report on Form 10-K. See also the section titled "Special Note Regarding Forward-Looking Statements."

Overview

Our mission is to significantly improve the lives of patients by replacing broad immunosuppression with targeted therapies. Our name, Alumis, captures our mission to enlighten immunology, and is inspired by the words "allumer"-French for illuminate-and "immunis"-Latin for the immune system.

We are a clinical stage biopharmaceutical company with an initial focus on developing our two TYK2 inhibitors: envu, formerly known as ESK-001, a second-generation inhibitor that we are developing to maximize target inhibition and optimize tolerability, and A-005, a CNS penetrant molecule. Envu is currently being evaluated in an ongoing Phase 2 OLE trial, as well as a Phase 3 LTE trial in patients with PsO and we plan to submit an NDA for envu in PsO to the FDA in the second half of 2026. Envu completed enrollment in the pivotal Phase 3 ONWARD1 and ONWARD2 clinical trials in patients with PsO, and we reported positive topline results in the first quarter of 2026. In addition, envu is currently being evaluated in a Phase 2 clinical trial in patients with SLE, for which we expect to report topline results in the third quarter of 2026. We are currently evaluating additional immune-mediated disease indications for envu, beyond PsO and SLE, and for A-005 in CNS and peripheral diseases. In April 2024, we initiated our Phase 1 program of A-005 in healthy volunteers and reported initial results in December 2024. In addition, in connection with the ACELYRIN Merger, we acquired lonigutamab, a subcutaneously delivered, monoclonal antibody targeting IGF-1R for the potential treatment of TED. We are continuing to evaluate the development program for lonigutamab and its potential differentiation in a capital efficient manner.

Alumis was incubated by Foresite Labs and incorporated on January 29, 2021, as a Delaware corporation under the name FL2021-001, Inc. FL2021-001, Inc.'s name was changed to Esker Therapeutics, Inc. in March 2021, and to Alumis Inc. in January 2022.

Since our inception, we have devoted substantially all of our efforts to organizing our company, hiring personnel, business planning, acquiring and developing our product candidates, performing research and development, conducting preclinical studies and clinical trials, establishing and protecting our intellectual property portfolio, raising capital, integrating the acquired ACELYRIN business and personnel, and providing general and administrative support for these activities. We do not have any products approved for sale and have not generated any revenue from product sales. We expect to continue to incur significant and increasing expenses and increasing substantial losses for the foreseeable future as we continue our development of and seek regulatory approvals for our product candidates and commercialize any approved products, seek to expand our product pipeline and invest in our expanded organization following the ACELYRIN Merger. Our ability to achieve and sustain profitability will depend on our ability to successfully develop, obtain regulatory approval for and commercialize our product candidates. There can be no assurance that we will ever achieve profitability, or if achieved, that the revenue or profitability will be sustained on a continuing basis.

To date, we have primarily funded our operations primarily through issuance of common stock, including in connection with the ACELYRIN Merger, our IPO and private placement transaction, the issuance of redeemable convertible preferred stock and convertible promissory notes in private placements, payments received under the Kaken Collaboration Agreement and, most recently, the public offering of common stock which closed on January 9, 2026. In addition, on March 18, 2026, we entered into a Sales Agreement with Cantor, pursuant to which we may offer and sell, from time to time through Cantor, at our option, shares of our common stock having an aggregate offering price of up to $300.0 million.

As of December 31, 2025, we had $308.5 million in cash, cash equivalents and marketable securities.

We have incurred significant operating losses and negative cash flows since our inception. Our net loss for the years ended December 31, 2025 and 2024 was $243.3 million and $294.2 million, respectively. As of December 31, 2025, we had an accumulated deficit of $901.9 million. Substantially all of our net losses have resulted from costs incurred in connection with our research and development efforts, including acquisitions of in-process research and development assets, and, to a lesser extent, from general and administrative costs associated with our operations. Our net losses and operating losses may fluctuate from quarter to quarter and year to year depending primarily on the timing of acquisition of any new product candidates, the timing of our preclinical studies and clinical trials, our other research and development expenses, and the timing and amount of any milestone or royalty payments due under our existing or future license agreements. We have incurred and will continue to incur costs associated with operating as a public company, including significant legal, audit, accounting, regulatory and tax-related services associated with maintaining compliance with exchange listing and SEC requirements, director and officer liability insurance costs, investor and public relations costs, and other expenses.

We anticipate that our expenses will increase significantly in connection with our ongoing activities, particularly if and as we:

We do not expect to generate revenue from any product candidates that we develop until we obtain regulatory approval for one or more of such product candidates and commercialize our products or enter into collaboration agreements with third parties. Because of the numerous risks and uncertainties associated with biopharmaceutical product development, we may never achieve or sustain profitability and, unless and until we are able to develop and commercialize our product candidates, we will need to continue to raise additional capital. Until such time as we can generate significant revenue from product sales, if ever, we expect to finance our operations through public or private equity or debt financings, or potentially other capital sources, such as collaboration or licensing arrangements with third parties or other strategic transactions. There are no assurances that we will be successful in obtaining an adequate level of financing to support our business plans when needed on acceptable terms, or at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders will be or could be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt financing and equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise additional funds through collaboration or licensing arrangements with third parties or other strategic transactions, we may have to relinquish rights to our intellectual property, future revenue streams, research programs, or product candidates or grant licenses on terms that may not be favorable to us. If we are unable to raise capital as and when needed, or on attractive terms, we may have to significantly delay, reduce, or discontinue the development and commercialization of our product candidates or scale back or terminate our pursuit of new in-licenses and acquisitions.

We do not currently own or operate any manufacturing facility. We rely on CMOs to produce our product candidates in accordance with the FDA current cGMP regulations for use in our clinical studies. We have entered into development and manufacturing agreements with various CMOs relating to process development, manufacturing of drug substance and drug product, and quality testing of our product candidates. We expect to rely on our CMOs in the future for the manufacturing of our product candidates in order to expedite readiness for future clinical trials. Most of these CMOs have demonstrated capability in preparation of materials for commercialization. Additionally, we may decide to build our own manufacturing facility in the future to provide us with greater flexibility and control over our clinical or commercial manufacturing needs.

Given our stage of development, we do not yet have a fully established marketing or sales organization or commercial infrastructure; however, we have begun building foundational capabilities and intend to continue expanding the necessary sales, marketing and commercialization capabilities and infrastructure over time as our product candidates advance through clinical development and regulatory approval. We expect to spend a significant amount in commercial development and marketing costs prior to obtaining regulatory and marketing approval of one or more of our product candidates.

IPO and Concurrent Private Placement

On July 1, 2024, we completed our IPO, pursuant to which we issued and sold 13,125,000 shares of our common stock at $16.00 price per share to the public. Net proceeds from the IPO were $193.3 million, after deducting underwriting discounts and commissions and other offering costs totaling $16.7 million. In connection with the IPO, on July 17, 2024, an existing investor and a holder of more than 5% of our capital stock, purchased an additional 2,500,000 shares of our common stock at the IPO price per share for total gross and net proceeds of $40.0 million in a private placement transaction (the "Concurrent Private Placement").

Immediately prior to the closing of the IPO on July 1, 2024, all of the shares of our redeemable convertible preferred stock then outstanding converted into 28,855,656 shares of Class A common stock and 7,184,908 shares of Class B common stock at a 1-for-4.675 conversion ratio. All outstanding Class A common stock shares and all outstanding Class B common stock shares were redesignated immediately thereafter into the same number of shares of common stock and non-voting common stock, respectively.

ACELYRIN Merger

On February 6, 2025, we entered into a Merger Agreement with ACELYRIN and Merger Sub, a Delaware corporation and a direct wholly owned subsidiary. The Merger Agreement was approved by the disinterested directors on our board of directors and the board of directors of ACELYRIN and was approved by the stockholders of each company on May 13, 2025. On May 21, 2025, we completed the ACELYRIN Merger for a purchase consideration of approximately $238.1

million that included the issuance of 48,653,549 shares of our common stock and the fair value of replacement awards attributable to pre-combination services, to acquire net assets with a fair value of approximately $426.0 million. See Note 3 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.

Our results of operations include the accounts of our wholly owned subsidiaries ACELYRIN and WH2, LLC after the closing of the ACELYRIN Merger, and the accounts of Merger Sub from its incorporation in January 2025 until the ACELYRIN Merger. Accordingly, the results discussed below were impacted by the timing of the ACELYRIN Merger. WH2, LLC has not had any operations or any balances since the closing of the ACELYRIN Merger.

Public Offering of Common Stock

On January 7, 2026, we entered into an underwriting agreement (the "Underwriting Agreement") with Morgan Stanley & Co. LLC, Leerink Partners LLC and Cantor, as representatives of the several underwriters named therein (collectively, the "Underwriters"), relating to the issuance and sale in a public offering of 17,650,000 shares of our common stock at a price of $17.00 per share. In addition, we granted the Underwriters an option, exercisable for 30 days, to purchase up to 2,647,500 additional shares of common stock at the public offering price, less the underwriting discounts and commissions, which was exercised in full on January 8, 2026. On January 9, 2026, the offering closed and we received net proceeds of $324.4 million, after deducting underwriting discounts and commissions.

Macroeconomic Trends

Our business and results of operations may be affected by worldwide economic conditions, which may continue to be impacted by global macroeconomic challenges and uncertainty in the markets, including severely diminished liquidity and credit availability, rising inflation and monetary supply shifts, rising interest rates, labor shortages, declines in consumer confidence, declines in economic growth, increases in unemployment rates, recession risks and uncertainty about economic and geopolitical stability (for example, related to the evolving U.S. and ex-U.S. tariff landscape). Further, the United States and other countries have imposed and may continue to impose new trade restrictions and export regulations, have levied tariffs and taxes on certain goods, and could continue to significantly increase tariffs on a broad array of goods. For example, in April 2025, the U.S. government imposed a 10% baseline global tariff and in August 2025, the United States imposed higher "reciprocal" tariffs on numerous other territories, including EU member states and South Korea. While the U.S. Supreme Court recently issued a ruling invalidating tariffs imposed by the Trump administration under the International Emergency Economic Powers Act, other tariffs imposed by the U.S. government remain in place, including the 10% global tariff imposed by the Trump administration under Section 122 of the Trade Act of 1974 following the U.S. Supreme Court decision. Moreover, the Bureau of Industry and Security, U.S. Department of Commerce, has initiated an investigation to determine whether pharmaceutical ingredients, including finished drug product, manufactured outside the United States pose a national security risk and should be subject to additional tariffs. The effect of macroeconomic conditions may not be fully reflected in our results of operations until future periods. Moreover, negative macroeconomic conditions could adversely impact our ability to obtain financing in the future on terms acceptable to us, or at all. To date, the macroeconomic trends discussed above have not had a material adverse impact on our business, financial condition or results of operations. If, however, economic uncertainty increases or the global economy worsens, our business, financial condition and results of operations may be harmed.

Components of Results of Operations

Revenue

On March 25, 2025, we entered into the Kaken Collaboration Agreement. Under the terms of the Kaken Collaboration Agreement, we granted to Kaken an exclusive right to develop, manufacture and commercialize envu for dermatology indications in Japan, with options to expand the license, subject to opt-in payments and certain cost-sharing obligations on the part of Kaken, to include rheumatological and gastrointestinal diseases.

Pursuant to the terms of the Kaken Collaboration Agreement, we are responsible for the global development of envu in the dermatology field, and Kaken is responsible for the clinical development, regulatory approvals and commercialization

of envu in Japan in dermatology and other indications for which Kaken has exercised its option. Kaken is required to use commercially reasonable efforts to conduct all subsequent development, manufacture, and commercialization activities. The Kaken Collaboration Agreement further provides that we will retain rights to envu in all other indications and geographies.

In March 2025, Kaken made an upfront, non-refundable payment of $20.0 million to us. In addition, Kaken will pay us an aggregate of $20.0 million towards global development costs of envu in the dermatology field through the end of 2026 and thereafter will pay a specified share of development costs applicable to the dermatology field, and for any field for which Kaken exercises its option, subject to Kaken's right to opt out of cost-sharing in certain indications in specified circumstances. In addition, Kaken would pay us up to an aggregate of $36.0 million upon the achievement of regulatory milestones and upon Kaken's exercise of its field expansion options for the rheumatology and gastrointestinal fields. In addition, we are entitled to receive aggregate payments of up to ¥15.5 billion upon the achievement of commercial milestones, plus tiered royalties at percentages ranging from the low double digits into the twenties on aggregate net sales of envu in Japan.

Operating Expenses

Our operating expenses consist of (i) research and development expenses and (ii) general and administrative expenses, and include ACELYRIN's operations subsequent to the Closing Date.

Research and Development Expenses

Research and development expenses consist of external and internal costs primarily related to acquiring and developing our research pipeline and technologies and clinical development of our product candidates.

External costs include:

Internal costs include:

We have acquired and may continue to acquire the rights to develop and commercialize new product candidates. Upfront payments related to acquired IPR&D assets are recognized as expenses when we determine that the assets acquired do not have alternative future uses. Milestone payments are accrued and expensed when the achievement of the milestone is probable up to the point of regulatory approval and, absent obtaining such approval, have no alternative future use. Milestone payments made after a product's regulatory approval will be capitalized and amortized over the remaining useful life of the related product.

We expense research and development costs as incurred. Costs of certain activities are recognized based on an evaluation of the progress to completion of specific tasks. However, payments made prior to the receipt of goods or services that will be used or rendered for future research and development activities are deferred and capitalized as research and development prepaid expenses in our consolidated balance sheets. The capitalized amounts are recognized as expense as the goods are delivered or services are performed. Since our inception and through December 31, 2025, our external research and development expenses were primarily related to the discovery and advancement of programs under our TYK2 platform, including our two most advanced product candidates, envu and A-005. We use internal resources primarily for managing our research, process development, manufacturing and clinical development activities. In particular, with respect to internal costs, we deploy our personnel across all of our research and development activities as our employees work across multiple programs, and therefore the costs cannot be allocated to a particular product candidate or research program.

We expect our research and development expenses to increase substantially for the foreseeable future as we advance our product candidates into and through clinical trials, pursue regulatory approval of our product candidates, build our operational and commercial capabilities for marketing our products, if approved, and expand our pipeline of product candidates. The process of conducting the necessary clinical research to obtain regulatory approval is time-consuming, expensive and uncertain. The actual probability of success for our product candidates may be affected by a variety of factors, including the safety and efficacy of our product candidates, clinical data, investment in our clinical programs, competition, manufacturability and commercial viability. It is possible that we may never receive regulatory approval for any of our product candidates. As a result of the uncertainties discussed above, we are unable to determine the duration and completion of costs of our research and development projects or if, when and to what extent we will generate revenue from the commercialization and sale of our product candidates, if approved by the FDA and other comparable foreign regulatory authorities.

Our future research and development costs may vary significantly based on factors such as:

A change in the outcome of any of these variables with respect to the development of any of our product candidates could significantly change the costs and timing associated with the development of that product candidate.

General and Administrative Expenses

Our general and administrative expenses consist primarily of personnel-related costs, legal and consulting services, including those relating to intellectual property and corporate matters, marketing expenses and allocated facilities and other overhead costs, including software licenses, computer supplies, insurance and other miscellaneous expenses. Personnel-related costs include salaries, annual bonuses, benefits, travel and meal expenses and stock-based compensation expense for our general and administrative personnel.

We expect that our general and administrative expenses will increase substantially in the future as a result of expanding our operations, including hiring personnel, preparing for potential commercialization of our product candidates and facility occupancy costs. We also expect to continue incurring costs associated with being a public company, including costs related to accounting, audit, legal, consulting fees, regulatory and tax-related services associated with maintaining compliance with applicable Nasdaq and SEC requirements, additional director and officer insurance costs, and investor and public relations costs.

Other Income (Expense)

Other income (expense) consists primarily of interest income, including amortization of premiums and accretion of discounts on marketable securities, gain on bargain purchase and change in fair value of derivative liability.

At the closing of the ACELYRIN Merger in May 2025, we recognized a gain on bargain purchase which represents the excess of fair value of net assets acquired in the ACELYRIN Merger over the purchase consideration on the Closing Date. The gain on bargain purchase was recognized as other income in the consolidated statements of operations and comprehensive loss as of the Closing Date of the ACELYRIN Merger. See Note 3 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.

In March 2024, in connection with our redeemable convertible preferred stock financings, we issued options to purchase additional shares of redeemable convertible preferred stock at a specified price, which were accounted for as derivative liabilities. Changes in fair value of these derivative liabilities were included in the other income (loss) in the consolidated statement of operations and comprehensive loss for each reporting period until the derivatives were settled in May 2024.

Results of Operations and Comprehensive Loss

Comparison of the Years Ended December 31, 2025 and 2024

The following table summarizes our results of operations for the years ended December 31, 2025 and 2024 (dollars in thousands):

Revenue

For the year ended December 31, 2025, we recognized license revenue of $17.4 million and collaboration revenue of $6.7 million, related to the Kaken Collaboration Agreement. At inception of the contract, we allocated the transaction price to the License Obligation and Development Services Obligation by allocating the transaction price based on the relative standalone selling price of each obligation. The license revenue was recognized upon the transfer of the license to Kaken in March 2025. We expect to recognize revenue under the Development Services Obligation and Manufacturing Services Obligation through the term of the Kaken Collaboration Agreement as the services are performed. See Note 7 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.

Research and Development Expenses

The following table summarizes our external and internal research and development expenses for the years ended December 31, 2025 and 2024 (dollars in thousands):

* not meaningful

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Research and development expenses increased by $120.4 million, to $386.0 million for the year ended December 31, 2025, from $265.6 million for year ended December 31, 2024.

Milestones related to previously acquired IPR&D assets for the year ended December 31, 2024, included a $23.0 million clinical milestone payment made in connection with the FronThera Acquisition.

CRO, CMO and clinical trials expenses increased by $79.7 million, to $231.1 million for the year ended December 31, 2025, from $151.4 million for the year ended December 31, 2024, primarily due to an increase in clinical trial and CRO expenses related to the progression of our clinical trials for envu and other programs, including costs to support acceleration of clinical trial activities for our Phase 3 ONWARD clinical program, partially offset by a decrease in CMO expenses associated with manufacturing of clinical supplies to support our trials.

Professional consulting services expenses increased by $11.0 million, to $30.2 million for the year ended December 31, 2025, from $19.2 million for the year ended December 31, 2024, primarily due to services to support our clinical trial for envu and other programs.

Other research and development costs decreased by $1.2 million, to $9.1 million for the year ended December 31, 2025, from $10.3 million for the year ended December 31, 2024, primarily due to the timing of preclinical studies.

Personnel-related costs increased by $45.9 million, to $92.7 million for the year ended December 31, 2025, from $46.8 million for the year ended December 31, 2024, primarily due to an increase in research and development headcount and severance costs related to the ACELYRIN Merger, and included an increase in stock-based compensation expense of $11.2 million resulting from equity awards assumed in the ACELYRIN Merger and additional stock options granted.

Facilities and overhead costs increased by $8.0 million, to $22.9 million for the year ended December 31, 2025, from $14.9 million for the year ended December 31, 2024, primarily due to an increase in facility expenses allocated to research and development activities and an increase in information technology costs.

External Costs by Program

The following table summarizes our external costs by program for the years ended December 31, 2025 and 2024 (in thousands):

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During the years ended December 31, 2025 and 2024, our external research and development expenses were primarily related to the clinical development of our envu program and, to a lesser extent, the lonigutamab and A-005 development programs and our research pipeline.

General and Administrative Expenses

General and administrative expenses increased by $56.7 million, to $91.9 million for the year ended December 31, 2025, from $35.2 million for the year ended December 31, 2024.

Personnel-related expenses increased by $28.8 million, to $48.9 million for the year ended December 31, 2025, from $20.0 million for the year ended December 31, 2024, primarily due an increase in general and administrative headcount and severance costs related to the ACELYRIN Merger, and included an increase in stock-based compensation expense of $12.9 million resulting from equity awards assumed in the ACELYRIN Merger and additional stock options granted.

Professional consulting services expenses increased by $28.1 million, to $41.4 million for the year ended December 31, 2025, from $13.3 million for the year ended December 31, 2024, primarily due to the ACELYRIN Merger transaction costs, a loss reserve and an increase in consulting, audit and tax, legal and accounting services to support our growth, public company requirements and business development.

Other Income (Expense), Net

Other income (expense), net increased by $195.4 million, to $201.9 million for the year ended December 31, 2025, from $6.5 million for the year ended December 31, 2024.

A gain on bargain purchase of $187.9 million was recognized at the Closing Date of the ACELYRIN Merger. No such gain was recognized in any other reporting period.

Interest income increased by $2.2 million, to $14.2 million for the year ended December 31, 2025, from $12.0 million for the year ended December 31, 2024, primarily as a result of higher balances of cash equivalents and marketable securities.

We recognized a change in fair value of a derivative liability loss of $5.4 million for the year ended December 31, 2024 related to the derivative liability recognized in connection with our Series C redeemable convertible preferred stock financing entered into in March 2024. The derivative liability was re-measured at fair value and settled in May 2024, when we closed the second tranche of the Series C financing.

Income Tax Benefit

Income tax benefit was $8.6 million for the year ended December 31, 2025, as compared to zero for the year ended December 31, 2024. The income tax benefit was related to the realization of deferred tax assets and valuation allowance release as a result of the ACELYRIN Merger.

Liquidity, Capital Resources and Capital Requirements

Sources of Liquidity

Since our inception, we have not generated any revenue from product sales and have incurred significant operating losses and negative cash flows from our operations. To date, we have primarily funded our operations through the issuance of common stock, including in connection with the ACELYRIN Merger, our IPO and Concurrent Private Placement, the issuance of redeemable convertible preferred stock and convertible promissory notes in private placements and, most recently, our public offering of common stock which closed on January 9, 2026.

On March 18, 2026, we entered into the Sales Agreement with Cantor as sales agent, pursuant to which we may offer and sell, from time to time through Cantor, at our option, shares of our common stock having an aggregate offering price of up to $300.0 million (the "ATM Shares"). The sales of the ATM Shares will be made by any method permitted that is deemed to be an "at-the-market" equity offering as defined in Rule 415(a)(4) promulgated under the Securities Act, including sales made directly on or through the Nasdaq Global Select Market. We agreed to pay Cantor a commission of up to 3.0% of the aggregate gross proceeds from any ATM Shares sold by Cantor.

Based on our current operating plan, our existing cash, cash equivalents and marketable securities of $308.5 million as of December 31, 2025, as well as net proceeds of $324.4 million, after deducting underwriting discounts and commissions, from our public offering of common stock, which closed on January 9, 2026, will be sufficient to meet our operating and capital requirements for at least 12 months from the date of issuance of our consolidated financial statements included in Part II. Item 8 of this Annual Report on Form 10-K. We expect to continue to incur substantial losses for the foreseeable future, and our transition to profitability will depend upon successful development, approval and commercialization of our product candidates and upon achievement of sufficient revenues to support our cost structure. We do not expect to generate any revenue from commercial product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our product candidates. We may never achieve profitability, and unless we do and until then, we will need to continue to raise additional capital. We will need to raise significant additional capital to fund ongoing research and development activities and maintain future operations. We continuously monitor and, where necessary, may reduce our operating expenses in response to our clinical development progress and our ability and need to raise additional capital through a combination of public and private equity, debt financings, strategic alliances, and licensing arrangements. For example, should any of our ongoing trials not meet our clinical development objectives, we may scale back or discontinue related activities and reallocate our working capital to extend our ability to meet our operating and capital requirements. Our ability to access capital when needed is not assured and, if capital is not available to us when, and in the amounts, needed, on the terms which are favorable, we could be required to delay, scale back, or abandon some or all of our planned development programs and other operations, which could materially harm our business, financial condition and results of operations.

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Future Funding Requirements

Our primary uses of cash are to fund our operations, which consist primarily of research and development expenditures related to our programs and, to a lesser extent, general and administrative expenditures. We anticipate that we will continue to incur significant and increasing expenses for the foreseeable future as we continue to advance our product candidates, expand our corporate infrastructure, including the costs associated with being a public company, further our research and development initiatives for our product candidates, and incur costs associated with potential commercialization. We are subject to all of the risks typically related to the development of new drug candidates, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business. We anticipate that we will need substantial additional funding in connection with our continuing operations.

We do not have any products approved for sale and have not generated any revenue from product sales since our inception. We do not expect to generate revenue from any product candidates that we develop until we obtain regulatory approval for one or more of such product candidates and commercialize our products or enter into collaboration agreements with third parties. Because of the numerous risks and uncertainties associated with biopharmaceutical product development, we may never achieve or sustain profitability and, unless and until we are able to develop and commercialize our product candidates, we will need to continue to raise additional capital. Until such time as we can generate significant revenue

from product sales, if ever, we expect to finance our operations through public or private equity or debt financings, or potentially other capital sources, such as collaboration or licensing arrangements with third parties or other strategic transactions. There are no assurances that we will be successful in obtaining an adequate level of financing to support our business plans when needed on acceptable terms, or at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders will be or could be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt financing and equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise additional funds through collaboration or licensing arrangements with third parties or other strategic transactions, we may have to relinquish rights to our intellectual property, future revenue streams, research programs, or product candidates or grant licenses on terms that may not be favorable to us. If we are unable to raise capital as and when needed, or on attractive terms, we may have to significantly delay, reduce, or discontinue the development and commercialization of our product candidates or scale back or terminate our pursuit of new in-licenses and acquisitions.

Because of the numerous risks and uncertainties associated with research, development and commercialization of our products, we are unable to estimate the exact amount of our operating capital requirements. Our future funding requirements will depend on many factors, including the following:

Cash Flows

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

Operating Activities

Net cash used in operating activities was $369.5 million and $255.1 million for the years ended December 31, 2025 and 2024, respectively.

Net cash used in operating activities for the year ended December 31, 2025 was due to our net loss for the period of $243.3 million and changes in non-cash items totaling $144.0 million, partially offset by changes in operating assets and liabilities of $17.8 million. Non-cash items included $187.9 million related to gain on bargain purchase in connection with the ACELYRIN Merger and net accretion of discounts on marketable securities of $5.3 million, partially offset by $43.5 million related to stock-based compensation expense, $3.5 million related to depreciation and amortization, $1.7 million related to non-cash lease expense and $0.5 million related to impairment of long-lived assets. The changes in operating assets and liabilities primarily included a decrease of $17.2 million in other prepaid expenses and other assets, a decrease of $11.5 million in research and development prepaid expenses, an increase of $6.0 million in other accrued expenses and current liabilities, an increase of $4.1 million in deferred revenue, and an increase of $2.1 million in research and development accrued expenses, partially offset by an $8.6 million decrease in deferred tax liability, a decrease of $6.0 million in accounts payable, an increase of $5.5 million in other assets, non-current and a decrease of $3.2 million in operating lease liabilities.

Net cash used in operating activities for the year ended December 31, 2024 was due to our net loss for the period of $294.2 million, partially offset by changes in non-cash items totaling $24.4 million and changes in operating assets and liabilities of $14.8 million. Non-cash items included $19.5 million related to stock-based compensation expense, $5.4 million related to the change in fair value of the derivative liability and $3.2 million related to depreciation and amortization, partially offset by net accretion of discounts on marketable securities of $3.7 million. The changes in operating assets and liabilities primarily included an increase of $18.2 million in research and development accrued expenses, an increase of $8.5 million in accounts payable and a $3.5 million increase in other accrued expenses and current liabilities, partially offset by an increase of $10.8 million in research and development prepaid expenses, an increase of $2.9 million in other prepaid expenses and other assets and a decrease of $1.9 million in operating lease liabilities.

Investing Activities

Net cash provided by investing activities of $287.9 million for the year ended December 31, 2025, was related to maturities of marketable securities of $448.0 million and cash, cash equivalents and restricted cash acquired in connection with the ACELYRIN Merger of $49.7 million, partially offset by purchases of marketable securities of $209.2 million and by purchases of property and equipment of $0.7 million.

Net cash used in investing activities of $113.8 million for the year ended December 31, 2024, was related to purchases of marketable securities of $240.1 million and purchases of property and equipment of $1.7 million, partially offset by maturities of marketable securities of $128.0 million.

Financing Activities

Net cash provided by financing activities of $2.1 million for the year ended December 31, 2025 was primarily related to proceeds from the issuance of common stock under the 2024 ESPP (defined below) of $1.6 million and proceeds from issuance of common stock upon exercise of stock options of $0.5 million.

Net cash provided by financing activities of $492.4 million for the year ended December 31, 2024, included $258.5 million proceeds from the issuance of redeemable convertible preferred stock and derivative liability, net of offering costs, $193.3 million proceeds from initial public offering, net of underwriter discounts and commissions and other offering costs, $40.0 million proceeds from a private placement transaction and $0.6 million proceeds from issuance of common stock upon exercise of stock options.

Contractual Obligations and Commitments

Leases

We have operating lease arrangements for office and laboratory space in South San Francisco, California and office space in Southern California. As of December 31, 2025, we had total undiscounted lease payment obligations under non-cancelable leases of $8.5 million payable in the 12 months following December 31, 2025, and $44.5 million payable thereafter.

FronThera Contingent Consideration

On March 5, 2021, we entered into the FronThera Acquisition, and the transaction was accounted for as an asset acquisition. Under the agreement, we are obligated to pay contingent consideration of up to an aggregate of $120.0 million based on the achievement of specified clinical and approval milestones, for up to an aggregate of $70.0 million payable for clinical milestones, and for up to an aggregate of $50.0 million payable for approval milestones, including receipt of first commercialization approval in the United States or certain other jurisdictions, all related to technology acquired under the agreement. In the year ended December 31, 2022, we incurred and made a $37.0 million milestone payment for the first administration of envu to a patient enrolled in a Phase 2 clinical trial of envu, which was recorded in research and development expenses in the consolidated statement of operations and comprehensive loss. In July 2024, we met a milestone in connection with the first administration of envu to a patient enrolled in a Phase 3 clinical trial of envu and made a $23.0 million milestone payment in August 2024, which was recorded in research and development expenses in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2024. No other milestones were achieved or were probable of being achieved as of December 31, 2025.

License and Commercialization Agreement with Pierre Fabre

Upon the closing of the Merger Agreement, we became the successor to ACELYRIN's rights and obligations under the Pierre Fabre Agreement. We received certain exclusive worldwide licenses with the right to sublicense certain patents, know-how and other intellectual property to develop, manufacture, use and commercialize lonigutamab for non-oncology therapeutic indications. The license from Pierre Fabre extends to any product containing lonigutamab (excluding any fragments or derivatives) as its sole active ingredient (each, a "PF Licensed Product"). The Pierre Fabre Agreement prohibits us from using the licensed intellectual property in any antibody drug conjugate, multi-specific antibodies or any other derivatives of lonigutamab.

We are obligated to (i) make payments of up to $100.5 million upon the achievement of various development and regulatory milestones, (ii) make milestone payments of up to $390.0 million upon the achievement of certain commercial milestones, and (iii) pay tiered royalties in the high single-digit to low-teen percentages to Pierre Fabre on worldwide net sales in a given calendar year. Royalties will be payable for each PF Licensed Product in a given country during a period commencing upon the first commercial sale of such PF Licensed Product in such country and continuing until the latest of (a) 10 years after such first commercial sale, (b) expiration of last-to-expire valid claim in a licensed patent in such country and (c) expiration of regulatory exclusivity for such PF Licensed Product in such country. In the event we enter into a sublicense with a third party, we must also share with Pierre Fabre a percentage of any revenues from option fees, upfront payments, license maintenance fees, milestone payments or the like generated from the sublicense. Such percentage may

be between the high single-digits to the low thirties based on which stage of development of a PF Licensed Product the sublicense relates to.

Unless earlier terminated, the Pierre Fabre Agreement will continue on a PF Licensed Product-by-PF Licensed Product and country-by-country basis until there are no more royalty payments owed to Pierre Fabre on any PF Licensed Product thereunder. Either party may terminate the Pierre Fabre Agreement upon an uncured material breach, or upon the bankruptcy or insolvency of the other party. Pierre Fabre may also terminate the agreement if we or any of our affiliates institutes a patent challenge against the licensed patents from Pierre Fabre. We may also terminate the Pierre Fabre Agreement with or without cause upon nine months' prior written notice, so long as there is no ongoing clinical trial for any PF Licensed Product.

As of December 31, 2025, no milestones were achieved or probable of being achieved.

Purchase Commitments

We enter into contracts in the normal course of business with suppliers, CROs, CMOs and clinical trial sites. Upon the closing of the ACELYRIN Merger, we became the successor to contracts with non-cancellable obligations under ACELYRIN contracts. The total value of non-cancellable obligations under contracts was $1.6 million as of December 31, 2025. This presentation of non-cancellable purchase obligations does not include any estimates of potential reduction of such liabilities related to mitigation obligations of the counterparties in the event of cancellation under the terms of our engagements.

Recently Issued Accounting Pronouncements

A description of recently issued accounting pronouncements that may potentially impact our financial position, results of operations or cash flows is disclosed in Note 2 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.

Critical Accounting Policies and Significant Judgments and Estimates

Our management's discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America ("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, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported expenses during the reporting period. On an ongoing basis, we evaluate our estimates and assumptions, including but not limited to those related to research and development expenses and accruals, valuation of acquired IPR&D intangible assets, revenue recognition and stock-based compensation expense. These estimates and assumptions are monitored and analyzed by us for changes in facts and circumstances, and material changes in these estimates and assumptions could occur in the future. 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. Changes in estimates are reflected in reported results for the period in which they become known. Actual results may differ from these estimates under different assumptions or conditions.

Although our significant accounting policies are described in more detail in Note 2 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K, we believe that the following accounting policies are those most critical to the judgments and estimates used in the preparation of our consolidated financial statements.

Research and Development Expenses and Accruals

Research and development costs are expensed as incurred. As part of the process of preparing our financial statements, we are required to estimate our research and development accrued expenses, including those related to clinical trials and manufacturing clinical and preclinical materials. This process involves reviewing open contracts and purchase orders and communicating with our applicable personnel to identify services that have been performed on our behalf and estimating

the level of service performed and the associated cost incurred for the services when we have not yet been invoiced or otherwise notified of actual costs. Our service providers invoice us in arrears, as well as on a pre-determined schedule or when contractual milestones are met. We make estimates of our research and development accrued expenses as of each balance sheet date in the consolidated financial statements based on facts and circumstances known to us at that time. We periodically confirm the accuracy of the estimates with the service providers and make adjustments if necessary. Examples of estimated research and development accrued expenses include fees paid to:

Costs for clinical trials and manufacturing activities are recognized based on an evaluation of our vendors' progress towards completion of specific tasks, using data such as participant enrollment, clinical site activations or information provided to us by our vendors regarding their actual costs incurred. Payments for these activities are based on the terms of individual contracts and payment timing may differ significantly from the period in which the services were performed. We determine accrual estimates through reports from and discussions with applicable personnel and outside service providers as to the progress or state of completion of studies, or the services completed. Our estimates of research and development accrued expenses as of each balance sheet date are based on the facts and circumstances known at the time. Costs that are paid in advance of performance are deferred as a prepaid expense and amortized over the service period as the services are provided.

Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in reporting amounts that are too high or too low in any particular period. To date, there have not been any material adjustments to our prior estimates of research and development accrued expenses. However, due to the nature of estimates, we cannot assure that we will not make changes to our estimates in the future as we become aware of additional information about the status or conduct of our clinical trials and other research activities.

Business Acquisitions, Including Intangible Assets, Goodwill and Contingent Consideration

We account for business combinations, as defined in Accounting Standards Codification ("ASC") Topic 805, Business Combinations, using the acquisition method of accounting, which generally requires that assets acquired, including IPR&D intangible assets, and liabilities assumed, be recorded at fair value on the consolidated balance sheets as of the acquisition date. The excess of the fair value of the purchase consideration over the fair value of net assets acquired, if any, is recorded as goodwill on the consolidated balance sheet. The excess of the fair value of net assets acquired over the fair value of the purchase consideration, if any, represents negative goodwill, or a gain on bargain purchase, which is recognized in the consolidated statement of operations as of the date of the acquisition.

Calculating the fair value of assets acquired and liabilities assumed requires us to make significant estimates and assumptions. As a result, we may record adjustments to the fair values within the measurement period, which may be up to one year from the acquisition date, with the corresponding offset to goodwill or a gain on bargain purchase.

Transaction costs associated with business combinations are expensed as they are incurred.

Intangible assets related to IPR&D projects acquired are considered to be indefinite-lived until abandonment or completion of the associated R&D efforts, which generally occurs when regulatory approval is obtained. Goodwill and indefinite-lived intangible assets are not amortized and, instead, are tested for impairment annually, in the fourth quarter, or more frequently if events or changes in circumstances indicate that it is more likely than not that the assets are impaired as required by ASC 350 Intangibles - Goodwill and Other. Such events and circumstances may include a significant change in our business climate, economic and industry trends, legal factors, negative operating performance indicators, significant competition or changes in strategy. We perform testing of indefinite-lived intangible assets, other than goodwill, at the

asset group level using a discounted cash flow model. If the carrying value exceeds the fair value, an impairment loss is recorded for that excess. We would also be required to reduce the carrying amounts of the related assets on our consolidated balance sheet. Determining the fair value of an indefinite-lived intangible asset group requires the application of judgment and involves the use of significant estimates and assumptions, including projections of future cash flows, which include estimated revenues, costs and probabilities of achieving technical and regulatory milestones, and discount rates, among other factors. We base our fair value estimates on assumptions we believe to be reasonable, but which are unpredictable and inherently uncertain. Actual future results may differ from the estimates. Development costs incurred after an acquisition are expensed as they are incurred.

Intangible assets with finite useful lives, which include completed IPR&D projects, are amortized over their estimated useful lives, primarily on a straight-line basis, and are also periodically reviewed for changes in facts or circumstances that may result in an impairment or in a reduction to the estimated useful life of the asset.

In determining the initial fair value of an intangible asset, or when quantitative analysis is required to determine any impairment, we usually use an income approach that discounts expected future cash flows to present value using a discount rate that is based on the estimated weighted-average cost of capital for comparable companies and represents the rate that market participants would use to value the intangible asset. These cash flow models require the use of Level 3 fair value measurements and inputs, including estimated revenues, costs and probabilities of technical and regulatory milestones, among other factors.

If we are required to pay future consideration that is contingent upon the achievement of specified development, regulatory approval or sales-based milestone events, then the estimated fair value of contingent consideration liabilities is recognized in the consolidated balance sheet as of the date of the acquisition. Each reporting period thereafter, we revalue these obligations and record increases or decreases in their fair value on the consolidated statements of operations until such time that the payment is made or obligations expire.

Revenue Recognition

We earn revenue from collaboration agreements that allow collaborators to develop, manufacture and commercialize product candidates. Collaboration revenue is recognized in accordance with ASC Topic 606, Revenue from Contracts with Customers ("ASC 606"). Arrangements with collaborators may include intellectual property licenses, research and development services, manufacturing services for clinical and commercial supply and participation in joint steering committees.

We recognize collaboration revenue in an amount that reflects the consideration that we expect to receive in exchange for those goods or services when our collaborator, or customer, obtains control of promised goods or services. We follow a five-step approach: (i) identify the contract with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations, and (v) recognize revenue when (or as) the customer obtains control of the product or service.

At contract inception, once the contract is determined to be within the scope of ASC 606, we assess the goods or services promised within the contract to determine whether each promised good or service is a performance obligation. Performance obligations are promises in a contract to transfer a distinct good or service to the customer that (i) the customer can benefit from on its own or together with other readily available resources and (ii) are separately identifiable from other promises in the contract. Goods or services that are not individually distinct performance obligations are combined with other promised goods or services until such combined group of promises meet the requirements of a performance obligation.

We determine the transaction price based on the amount of consideration we are entitled to receive in exchange for the transfer of control of a product or a service to the customer. Consideration may be fixed, variable, or a combination of both. Payments to us under these arrangements typically include one or more of the following: non-refundable upfront payments, reimbursement for research services, payments for clinical supplies, research, development or regulatory milestone payments, profit-sharing arrangements, and royalty and commercial sales milestone payments. Variable consideration, such as performance-based milestones, are included in the total consideration if we expect to receive such consideration and if it is probable that the inclusion of the variable consideration will not result in a significant reversal in

the cumulative amount of revenue recognized under the arrangement. We account for cost reimbursements included in the transaction price using the expected value method. We exclude sales-based royalty and milestone payments from the total consideration we expect to receive until the underlying sales occur because the license to our intellectual property is deemed to be the predominant item to which the royalties or milestones relate as it is the primary driver of value in the collaboration arrangements.

We then allocate the transaction price to each distinct performance obligation based on the relative standalone selling price. Key assumptions to determine the standalone selling price may include forecasted revenues, development timelines, probabilities of technical and regulatory success, and the expected level of effort for research and development services. We recognize revenue associated with each performance obligation as the control over the promised goods or services transfer to our collaborators which occurs either at a point in time or over time. If control transfers over time, revenue is recognized by using a method of measuring progress that best depicts the transfer of goods or services. We evaluate the measure of progress and related inputs each reporting period and any resulting adjustments to revenue are recorded on a cumulative catch-up basis. Consideration allocated to options that include material rights is deferred until the options are exercised or expire.

Stock-Based Compensation Expense

We account for stock-based compensation expense in accordance with ASC Topic 718, Compensation-Stock Compensation ("ASC 718"). We grant stock-based awards to employees, directors and non-employee consultants in the form of stock options and restricted stock units ("RSUs") to purchase shares of our common stock. Compensation expense for stock options with service-based vesting conditions is measured at the fair value of the award on the grant date and is recognized over the requisite service period, which is generally the vesting period, using the straight-line method. We estimate the fair value of each stock option with service-based vesting on the date of grant using the Black-Scholes option pricing model. This model requires the use of subjective assumptions to determine the fair value of each stock-based award, including:

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We have also granted stock options with graded vesting based on market, service and performance conditions. At the grant date, the fair value of these stock options was estimated using a Monte Carlo simulation model, which uses a distribution of potential outcomes over the vesting period. The assumptions utilized in the calculation included our expected common stock price, expected volatility, risk-free rate and expected term. Stock-based compensation expense for these awards is recognized on a straight-line basis over the requisite service period, which is the longer of the explicit service period of the service condition and the derived service period of the market condition, as determined for each separately vesting portion of the awards as if each award was, in substance, multiple awards.

Stock-based compensation expense related to stock purchase rights under our 2024 Employee Stock Purchase Plan (the "2024 ESPP") is measured based on grant date at fair value using the Black-Scholes option-pricing model. The model requires us to make a number of assumptions, including common stock fair value, expected volatility, expected term, risk-free interest rate and expected dividend yield. Stock-based compensation expense is recognized on a straight-line basis over the offering period.

We account for award forfeitures as they occur and classify stock-based compensation expense in our consolidated statements of operations and comprehensive loss in the same manner in which the award recipient's salary or services costs are classified.

Off-Balance Sheet Arrangements

During the periods presented we did not have, nor do we currently have, any off-balance sheet arrangements as defined in the rules and regulations of the Securities and Exchange Commission ("SEC").

JOBS Act Transition Period and Smaller Reporting Company Status

We are an "emerging growth company" as defined in the JOBS Act. Under the JOBS Act, an emerging growth company can take advantage of the extended transition period for complying with new or revised accounting standards and delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this exemption from complying with new or revised accounting standards and, therefore, will not be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.

Subject to certain conditions, as an emerging growth company, we may rely on certain of these exemptions, including without limitation exemptions to the requirements for (i) providing an auditor's attestation report on our system of internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act and (ii) complying with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor's report providing additional information about the audit and the financial statements, known as the auditor discussion and analysis. We will remain an emerging growth company until the earlier to occur of (a) the last day of the fiscal year (A) following the fifth anniversary of the completion of our IPO, (B) in which we have total annual gross revenues of at least $1.235 billion or (C) in which we are deemed to be a "large accelerated filer" under the rules of the SEC, which means the market value of our common stock and non- voting common stock that is held by non-affiliates exceeds $700.0 million as of the prior June 30th, or (b) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.

We are also a "smaller reporting company," as defined in Rule 12b-2 of the Exchange Act, meaning that the market value of our common stock and non-voting common stock held by non-affiliates was less than $250.0 million as of June 30, 2025. We may continue to be a smaller reporting company if either (i) the market value of our common stock and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter or (ii) our annual revenue is less than $100.0 million during the most recently completed fiscal year and the market value of our common stock and non-voting common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter. If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company we may choose to present only the two most recent fiscal years of audited consolidated financial statements in our Annual Report on Form 10-K and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation.