Crescent Biopharma Inc.
02/26/2026 | Press release | Distributed by Public on 02/26/2026 06:28
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 the audited consolidated financial statements and the related notes included in Part II, Item 8 of this Annual Report on Form 10-K for the twelve months ended December 31, 2025 (this "Annual Report"). The following discussion contains forward-looking statements that reflect our current plans, estimates and beliefs and words such as "may," "might," "will," "would," "shall," "objective," "intend," "target," "should," "could," "can," "expect," "anticipate," "believe," "design," "estimate," "forecast," "predict," "potential," "plan," "seek," or "continue" and variations of such words and any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, and similar expressions are intended to identify forward-looking statements. Our historical results are not necessarily indicative of the results that may be expected for any period in the future. Our actual results and the timing of events could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to these differences include those discussed in Part I, Item 1A "Risk Factors" appearing elsewhere in this Annual Report. These and many other factors could affect our future financial and operating results. We undertake no obligation to update any forward-looking statement to reflect events after the date of this Annual Report. As used in this Annual Report, unless the context suggests otherwise, "we," "us," "our," the "Company," "Crescent Biopharma, Inc.," "Crescent," "GlycoMimetics, Inc.," "GlycoMimetics," refers to Crescent Biopharma, Inc. and its consolidated subsidiaries.
Overview
We are a clinical-stage biotechnology company focused on delivering the next wave of transformative therapies to bring a brighter future for people living with cancer. We have a bold vision to build the next leading biotechnology oncology company. We are executing across two distinct strategies to build our portfolio to achieve this vision. First, we are developing CR-001, which we refer to as a PD-1 x VEGF bispecific antibody because it is designed to bind both the PD-1 immune checkpoint ("PD-1") and Vascular Endothelial Growth Factor ("VEGF"), which has potential to replace pembrolizumab, marketed by Merck as Keytruda®, as the foundational immuno-oncology backbone; second, we are building a robust portfolio of potentially best-in-class antibody drug conjugates ("ADCs"). Importantly, as we execute on these two strategies, we intend to combine CR-001 and ADC therapies to create what we believe will be best-in-class synergistic combinations to transform care for multiple types of cancer. We initiated a global Phase 1/2 trial of CR-001 (the "ASCEND trial") in February 2026 and we anticipate initiation of CR-002 and CR-003 monotherapy clinical trials in 2026 as well as the first ADC combination trial with CR-001.
We initiated ASCEND, a global Phase 1/2 trial of CR-001 in up to eight solid tumor types in the first quarter of 2026. We believe that, because CR-001 incorporates the functional properties of ivonescimab, early clinical data from ivonescimab can serve as important validation of potential effectiveness and tolerability of both ivonescimab and CR-001, thereby allowing us to move quickly into late-stage development with a level of speed and confidence that would not exist if CR-001 did not incorporate the PD-1 and VEGF binding affinity, potency, and cooperative pharmacology of ivonescimab. In the first quarter of 2027, we anticipate sharing meaningful data on CR-001's clinical profile, including initial safety, pharmacokinetics ("PK") and early anti-tumor activity from dose escalation and backfill cohorts in first-line and previously treated patients.
CR-002 is a PD-L1-directed ADC designed to deliver a topoisomerase toxin to cancer cells that express PD-L1, a cell surface protein that suppresses T-cell activation. PD-L1 expression is elevated in numerous solid tumors compared to normal tissues, making it an attractive ADC target. We intend to initiate a Phase 1/2 trial of CR-002 in the second half of 2026.
We recently announced a partnership with Sichuan Kelun-Biotech Biopharmaceutical Co., Ltd. ("Kelun"), a leading Chinese biotech company with commercially approved ADCs, to acquire exclusive rights to SKB105, an integrin beta-6 ("ITGB6") directed ADC, outside of mainland China, Hong Kong, Macau, and Taiwan (collectively, "Greater China"). We intend to develop SKB105 as CR-003, a product designation which previously referred to a preclinical ADC asset under the Amended and Restated ADC Discovery and Option Agreement, dated April 28, 2025 (the "ADC Paragon Option Agreement"). ITGB6 is a target with emerging clinical data generated by third party ADCs. We believe that CR-003 has the potential to deliver potent antitumor activity based on its improved potency and half-life in preclinical models. A Phase 1/2 trial of CR-003 is anticipated to be initiated in the first quarter of 2026 in China. We believe that CR-002 and CR-003 have the potential to provide therapeutic benefit both when used as monotherapies and in combination with CR-001.
Since our inception in September 2024, we have devoted substantially all of our resources to raising capital, organizing and staffing the Company, business and scientific planning, conducting discovery and research activities, establishing
arrangements with third parties, and providing general and administrative support for these operations. We do not have any products approved for sale and have not generated any revenue from product sales. To date, we have funded our operations primarily with proceeds from the reverse recapitalization and merger with GlycoMimetics, Inc., our Pre-Closing Financing, and our Private Placement (as defined and further described in "Recent Developments"below).
We have incurred operating losses since inception. Our ability to generate product revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of any programs we may develop. We incurred net losses of $153.9 million and $17.9 million for the twelve months ended months ended December 31, 2025 and for the period from September 19, 2024 (inception) through December 31, 2024, respectively. As of December 31, 2025, we had an accumulated deficit of $171.8 million. For the twelve months ended December 31, 2025, we have used net cash of $71.5 million for our operating activities.
As of December 31, 2025, we had cash and cash equivalents of $213.2 million. We expect that our existing cash will be sufficient to fund our operating plans for at least twelve months from the date of filing of this Annual Report. 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.
Recent Developments
The Merger
On June 13, 2025, we consummated the closing (the "Closing") pursuant to that certain Agreement and Plan of Merger and Reorganization, dated as of October 28, 2024, which agreement was subsequently amended on February 14, 2025 and April 28, 2025 (as amended, the "Merger Agreement"), by and among GlycoMimetics, Gemini Merger Sub Corp. ("First Merger Sub"), Gemini Merger Sub II, LLC ("Second Merger Sub"), and Crescent Biopharma, Inc., a private company established and incorporated under the laws of the state of Delaware on September 19, 2024 ("Pre-Merger Crescent"). First Merger Sub merged with and into Pre-Merger Crescent, with Pre-Merger Crescent continuing as a wholly owned subsidiary of GlycoMimetics and the surviving corporation of the merger (the "First Merger"), and Pre-Merger Crescent merged with and into Second Merger Sub, with Second Merger Sub being the surviving entity of the merger (the "Second Merger," and together with the First Merger, the "Merger"). After the completion of the Merger, Second Merger Sub changed its corporate name to "Crescent Biopharma Operating Company, LLC" and GlycoMimetics changed its name to "Crescent Biopharma, Inc." On December 30, 2025, Crescent Biopharma Operating Company, LLC was merged with and into Crescent Biopharma, Inc., a newly formed Delaware corporation. We are led by the Pre-Merger Crescent management team and remain focused on developing differentiated oncology therapeutics for patients living with solid tumors.
Following the Reverse Stock Split (as defined below), which occurred immediately prior to the Closing of the Merger, and as a result of and upon the effective time of the First Merger (the "First Effective Time"), (i) each then-outstanding share of common stock, par value $0.001 per share, of Pre-Merger Crescent (including shares of common stock issued in the Crescent Pre-Closing Financing (as defined below) and excluding shares canceled pursuant to the Merger Agreement and excluding dissenting shares) automatically converted solely into the right to receive a number of shares of common stock, par value $0.001 per share, of GlycoMimetics (the "Company common stock," and prior to the effective time of the Merger, the "GlycoMimetics common stock") equal to the Exchange Ratio (as defined below); (ii) each then-outstanding share of Preferred Stock, par value $0.001 per share, of Pre-Merger Crescent (the "Pre-Merger Crescent preferred stock") automatically converted into the right to receive a number of shares of Series A Non-Voting Convertible Preferred Stock, par value $0.001 per share, of GlycoMimetics (which were each convertible into 1,000 shares of Company common stock) (the "Company Series A Preferred Stock," and prior to the effective time of the Merger, the "GlycoMimetics Series A Preferred Stock"), equal to the Exchange Ratio divided by 1,000; (iii) each then-outstanding option to purchase Pre-Merger Crescent common stock was assumed by GlycoMimetics; (iv) each then-outstanding Pre-Merger Crescent restricted stock unit was assumed by GlycoMimetics; (v) each then-outstanding pre-funded warrant to purchase shares of Pre-Merger Crescent common stock was converted into a pre-funded warrant to purchase shares of Company common stock; (vi) each in-the-money option to acquire shares of GlycoMimetics common stock that was issued and outstanding (whether vested or unvested) was cancelled and converted into the right to receive a number of shares of Company common stock equal to the number of shares underlying such option; (vii) each GlycoMimetics restricted stock unit was cancelled and converted into the right to receive a number of shares of GlycoMimetics common stock equal to the number of unsettled shares of GlycoMimetics common stock underlying such GlycoMimetics restricted stock unit; and (viii) each share of GlycoMimetics common stock that was issued and outstanding at the First Effective Time remains issued and outstanding in accordance with its terms.
The Merger was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Pre-Merger Crescent was deemed to be the accounting acquirer for financial reporting purposes. This determination was primarily based on the fact that, immediately following the Merger: (i) Pre-Merger Crescent stockholders own a substantial majority of the voting rights in the combined company; (ii) Pre-Merger Crescent's largest stockholders retain the largest interest in the combined company; (iii) Pre-Merger Crescent designated a majority of the initial members of the board of directors of the combined company; and (iv) Pre-Merger Crescent's executive management team became the management team of the combined company. Accordingly, for accounting purposes: (i) the Merger was treated as the equivalent of Pre-Merger Crescent issuing stock to acquire the net assets of GlycoMimetics; and (ii) the reported historical operating results of the combined company prior to the Merger are those of Pre-Merger Crescent. Additional information regarding the Merger is included in Note 4 to the consolidated financial statements included in Part II, Item 8 of this Annual Report.
Pre-Closing Financing
In connection with the Merger, Pre-Merger Crescent and GlycoMimetics entered into an amended and restated subscription agreement (the "Subscription Agreement") with certain new and existing investors of Pre-Merger Crescent (the "Financing Investors"), pursuant to which such investors purchased, immediately prior to the First Merger, 85,506,824 shares of Pre-Merger Crescent common stock and 19,149,690 Pre-Merger Crescent pre-funded warrants, for gross proceeds of approximately $200.0 million (which includes $37.5 million of proceeds previously received from the issuance of convertible notes and $3.0 million of accrued interest thereon) (the "Crescent Pre-Closing Financing"). Under the Subscription Agreement, the number of shares of Pre-Merger Crescent common stock or Pre-Merger Crescent pre-funded warrants were converted into 12,355,716 shares of Company Common Stock and 2,767,122 pre-funded warrants of Company common stock in accordance with the Exchange Ratio (defined below).
The Exchange Ratio was calculated using a formula intended to allocate existing GlycoMimetics and Pre-Merger Crescent security holders a percentage of the Company. Based on GlycoMimetics' and Pre-Merger Crescent's values as of the date of the Merger Agreement and capitalization as of June 13, 2025, the Exchange Ratio (as adjusted for the Reverse Stock Split) was 0.1445 shares of GlycoMimetics common stock for each share of Crescent common stock.
Reverse Stock Split
Immediately prior to the consummation of the Merger, GlycoMimetics effected a 1-for-100 reverse stock split of GlycoMimetics common stock, which became legally effective on June 13, 2025 (the "Reverse Stock Split"). The Company common stock commenced trading on a post-Reverse Stock Split, post-Merger basis at the open of trading on June 16, 2025. All references to common stock, options to purchase common stock, outstanding common stock warrants, common stock share data, per share data, and related information contained in the consolidated financial statements have been retrospectively adjusted to reflect the effect of the Reverse Stock Split for all periods presented, unless otherwise specifically indicated or the context otherwise requires.
Redomestication
On June 16, 2025, we changed our jurisdiction of incorporation from the State of Delaware to the Cayman Islands (the "Redomestication") pursuant to a plan of conversion (the "Plan of Conversion"). The Redomestication became effective on June 16, 2025 and was accomplished by the filing of (i) a Certificate of Conversion with the Secretary of State of the State of Delaware and (ii) the requisite documents required under section 201 of the Companies Act (as amended) of the Cayman Islands (the "Companies Act"), as well as the Cayman Islands memorandum and articles of association of the Company (the "Articles"), with the Cayman Islands Registrar of Companies. For purposes of these consolidated financial statements, references to "Crescent Delaware" mean Crescent prior to the Redomestication.
Upon the Redomestication, among other things: (i) each outstanding share of common stock, par value $0.001 per share, of Crescent Delaware automatically converted into one ordinary share, par value $0.001 per share, of the Company; (ii) each outstanding share of Series A Non-Voting Convertible Preferred Stock, par value $0.001 per share, of Crescent Delaware automatically converted in one share of Series A Non-Voting Convertible Preferred Share, par value $0.001 per share, of the Company (the "Series A Preferred Shares"); (iii) each outstanding option to purchase shares of common stock of Crescent Delaware automatically converted into an option to purchase ordinary shares of the Company; (iv) each outstanding restricted stock unit of Crescent Delaware automatically converted into a restricted stock unit of the Company; and (v) each warrant to purchase shares of common stock of Crescent Delaware automatically converted into a warrant to purchase ordinary shares of the Company.
The rights of holders of ordinary shares of the Company are now governed by the Company's memorandum and articles of association and Cayman Islands law.
Strategic Transaction with Sichuan Kelun-Biotech Biopharmaceutical Co., Ltd.
On December 2, 2025, Crescent Biopharma Operating Company, LLC ("Crescent OpCo"), the wholly owned subsidiary of Crescent Biopharma, Inc., a Cayman Islands exempted company (together with its subsidiaries, "we" or "us"), entered into two license agreements with Kelun (the "Strategic Transaction"), each of which is described below.
Kelun CR-001 License Agreement
On December 2, 2025, we entered into a License Agreement (the "Kelun CR-001 License Agreement") with Kelun under which we granted Kelun an exclusive, royalty-bearing license to research, develop, manufacture and commercialize CR-001, our proprietary bispecific antibody directed to VEGF and PD-1, in Greater China (the "SKB Territory"). We retain all rights to CR-001 outside the SKB Territory.
Under the Kelun CR-001 License Agreement, Kelun is responsible for development, manufacturing, regulatory and commercial activities for CR-001 in the SKB Territory, and is obligated to use commercially reasonable efforts to develop and commercialize at least one CR-001 product candidate in the SKB Territory.
SKB105 License and Collaboration Agreement
On December 2, 2025, we entered into a License and Collaboration Agreement (the "SKB105 License Agreement") with Kelun, under which Kelun granted us an exclusive license to research, develop, manufacture and commercialize SKB105, Kelun's proprietary integrin beta-6-directed antibody-drug conjugate, in all territories outside the SKB Territory.
We are responsible for all development, manufacturing, regulatory and commercial activities for SKB105 outside the SKB Territory and are obligated to use commercially reasonable efforts to develop, obtain regulatory approval for, manufacture (or have manufactured) and commercialize at least one SKB105 product in the United States and at least three major European markets.
The SKB105 License Agreement includes initial supply of SKB105 drug product, a data-sharing arrangement, know-how and manufacturing technology transfer provisions, intellectual property provisions, and customary termination rights, including reversion and license-back mechanics in specified circumstances.
Amendment No. 1 to License Agreement with Paragon Therapeutics, Inc.
On December 2, 2025, we entered into Amendment No. 1 (the "Amendment") to the License Agreement, dated April 28, 2025, by and between us and Paragon Therapeutics, Inc., a Delaware corporation (the "Paragon License"), relating to CR-001. The purpose of the Amendment was to amend certain terms of the Paragon License for the sole purpose of accommodating and aligning with the sublicense for the Kelun CR-001 License Agreement.
Private Placement
On December 4, 2025, we entered into a Securities Purchase Agreement (the "Purchase Agreement") for a private placement (the "Private Placement") with certain institutional and other accredited investors (each, a "Purchaser" and collectively, the "Purchasers"). The closing of the Private Placement occurred on December 8, 2025.
Pursuant to the Purchase Agreement, the Purchasers agreed to purchase an aggregate of 13,795,685 ordinary shares with a par value of US$0.001 per share of the Company (the "Ordinary Shares"), at a purchase price per share of $13.41 (or, for certain investors in lieu of Ordinary Shares, pre-funded warrants (the "Pre-Funded Warrants") to purchase shares of Ordinary Shares (the "Pre-Funded Warrant Shares"), at a purchase price per underlying Pre-Funded Warrant Share of $13.409, which represents the per share purchase price of the Ordinary Shares less the $0.001 per share exercise price for each Pre-Funded Warrant), for an aggregate purchase price of approximately $185.0 million.
The Pre-Funded Warrants will be exercisable at any time after the date of issuance. A holder of Pre-Funded Warrants may not exercise the warrant if the holder, together with its affiliates, would beneficially own more than 9.99% of the number of Ordinary Shares outstanding immediately after giving effect to such exercise. A holder of Pre-Funded Warrants may increase or decrease this percentage to a percentage not in excess of 19.99% by providing at least 61 days' prior notice to us.
Impact of General Economic Risk Factors on Crescent's Operations
Uncertainty in the global economy presents significant risks to our business. We are subject to continuing risks and uncertainties in connection with the current macroeconomic environment, including increases in inflation, fluctuating interest rates, new or increased tariffs and other barriers to trade, changes to fiscal and monetary policy or government budget dynamics (particularly in the pharmaceutical and biotech areas), including as a result of bank failures, geopolitical factors, including the ongoing conflicts between Russia and Ukraine and in the Middle East and the responses thereto, and supply chain disruptions. While we are closely monitoring the impact of the current macroeconomic and geopolitical conditions on all aspects of our business, including the impacts on participants in any future clinical trials and our employees, suppliers, vendors, and business partners and our future access to capital, the ultimate extent of the impact on our business remains highly uncertain and will depend on future developments and factors that continue to evolve. Most of these developments and factors are outside our control and could exist for an extended period of time. We will continue to evaluate the nature and extent of the potential impacts to our business, results of operations, liquidity and capital resources. For additional information, see Part I, Item 1A, "Risk Factors."
Components of Results of Operations
Revenue
Our revenues to date have been generated through the Kelun CR-001 License Agreement. We recognize revenue over the expected performance period under the agreement. The terms of this agreement include one or more of the following types of payments: non-refundable license fees, payments based on the achievement of specified milestones, and royalties on any net product sales. To date, we have received a non-refundable upfront payment for the license to CR-001. We expect that our revenue for the next several years will be derived primarily from our current license agreements and any additional licensing agreements that we may enter into in the future.
To date, we have not generated revenue from product sales, and do not expect to generate any revenue from the sale of products in the foreseeable future. If our development efforts for our product candidates are successful and result in regulatory approval, we may generate revenue in the future from product sales or payments from existing or future collaboration or license agreements that we may enter into with third parties, or any combination thereof. We cannot predict if, when, or to what extent we will generate revenue from the commercialization and sale of our product candidates. We may never succeed in obtaining regulatory approval for any of our product candidates.
Operating Expenses
Our operating expenses consist of (i) research and development expenses and (ii) general and administrative expenses.
Research and Development
Research and development expenses consist primarily of costs incurred in connection with the research and development of our programs. These expenses include:
•costs of funding research performed by third parties, including Paragon, that conduct research and development activities on our behalf and services rendered under the related Paragon option and license agreements for CR-001, CR-002, CR-003, and other discovery candidates;
•upfront fees paid to Kelun for the exclusive license to research, develop, manufacture, and commercialize SKB105;
•expenses incurred in connection with continuing our current research programs and discovery-phase development of any programs we may identify, including under future agreements with third parties, such as consultants and contractors; and
•personnel-related expenses, including recruiting costs, salaries, bonuses, benefits, and equity-based compensation expense.
We expense research and development costs as incurred. For the twelve months ended months ended December 31, 2025 and for the period from September 19, 2024 (inception) through December 31, 2024, we recognized $19.4 million and $13.2 million, respectively, of research and development expenses in connection with services provided by Paragon under the Antibody Discovery and Option Agreement, dated September 19, 2024 (the "Antibody Paragon Option Agreement"), and the ADC Paragon Option Agreement (together with the Antibody Paragon Option Agreement, the "Paragon Option Agreements"),under the CR-001 License Agreement with Paragon, dated April 28, 2025 and amended on December 2, 2025, and under the CR-002 License Agreement with Paragon, dated November 5, 2025, in our consolidated
statement of operations and comprehensive loss. See "Contractual Obligations and Commitments" below for further details on our research plans.
We expect our research and development expenses will increase substantially for the foreseeable future as we continue to invest in research and development activities related to the continued development of our programs, developing any future programs, including investments in manufacturing, as we advance any program we may identify and continue to conduct clinical trials. The success of programs we may identify and develop will depend on many factors, including the following:
•timely and successful completion of preclinical studies;
•submission and maintenance of Investigational New Drug application ("IND") or comparable foreign applications that allow commencement of our planned clinical trials or future clinical trials for any programs we may develop;
•successful enrollment and completion of clinical trials;
•positive results from our future clinical trials that support a finding of safety, purity, potency and/or effectiveness, acceptable pharmacokinetics profile, and an acceptable risk-benefit profile in the intended populations;
•receipt of marketing approvals from applicable regulatory authorities;
•establishment of arrangements through our own facilities or with third-party manufacturers for clinical supply and, where applicable, commercial manufacturing capabilities; and
•maintenance of a continued acceptable safety, tolerability, and efficacy profile of any programs we may develop following approval.
General and Administrative
General and administrative expenses consist primarily of personnel-related expenses, including recruiting costs, salaries, bonuses, benefits, and equity-based compensation, for individuals in our executive, finance, legal, operations, business development, and other administrative functions. Other significant general and administrative expenses include legal fees relating to corporate matters and patent-related activities, insurance costs, information technology, and professional and consulting fees associated with accounting, audit, tax, and investor and public relations.
We expect that our general and administrative expenses will increase substantially for the foreseeable future as we increase our headcount and further establish our office space to support our expected growth. We also expect to incur increased expenses as a public company, including increased costs of accounting, audit, legal, regulatory and tax related services associated with maintaining compliance with U.S. Securities and Exchange Commission ("SEC") requirements, additional director and officer insurance costs, and investor and public relations costs. We also expect to incur additional intellectual property-related expenses as we file patent applications to protect innovations arising from our research and development activities.
Other Income (Expense)
Other income (expense) includes interest income of $2.9 million and $0.2 million earned for the twelve months ended months ended December 31, 2025 and for the period from September 19, 2024 (inception) through December 31, 2024, respectively, relating to our money market accounts and interest expense of $2.2 million and $0.9 million incurred for the twelve months ended December 31, 2025 and for the period from September 19, 2024 (inception) through December 31, 2024, respectively, relating to our previously outstanding convertible notes with an initial principal amount of $37.5 million ("Convertible Notes") issued to various investors in October 2024, which converted to common stock (now, ordinary shares) and pre-funded warrants upon the close of the Merger.
Income Taxes
The provision for income taxes was $2.0 million for the twelve months ended December 31, 2025 and related to corporate withholding tax on the upfront license fee due from Kelun for the CR-001 License Agreement. We recorded a full valuation allowance against our net deferred tax assets as of the balance sheet date, as we believe it is not more likely than not that the benefit will be realized due to our cumulative losses generated to date and expectation of future losses.
On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework, and the restoration of favorable tax treatment for certain business tax provisions. We have evaluated the OBBBA provisions enacted during the period and estimated their impact on the consolidated financial statements to be immaterial. We will continue to evaluate the full impact of these legislative changes as additional guidance becomes available.
Results of Operations for the Twelve Months Ended December 31, 2025 Compared to the Period from September 19, 2024 (Inception) Through December 31, 2024
We were incorporated in September 2024 and, therefore, provide comparative information from the date of our inception through December 31, 2024. The following table summarizes our consolidated statement of operations and comprehensive loss for the periods presented (in thousands):
| Twelve Months Ended December 31, 2025 | Period from September 19, 2024 (Inception) Through December 31, 2024 | $ Change | |||||||||||||||
| License revenue | $ | 10,844 | $ | - | $ | 10,844 | |||||||||||
| Operating expenses | |||||||||||||||||
|
Research and development(1)
|
138,086 | 14,034 | 124,052 | ||||||||||||||
|
General and administrative(2)
|
25,390 | 3,157 | 22,233 | ||||||||||||||
|
Total operating expenses
|
163,476 | 17,191 | 146,285 | ||||||||||||||
| Loss from operations | (152,632) | (17,191) | (135,441) | ||||||||||||||
| Other income (expense): | |||||||||||||||||
|
Interest income
|
2,875 | 176 | 2,699 | ||||||||||||||
|
Interest expense(3)
|
(2,185) | (852) | (1,333) | ||||||||||||||
|
Loss before provision for income taxes
|
(151,942) | (17,867) | (134,075) | ||||||||||||||
| Income tax provision | (2,000) | - | (2,000) | ||||||||||||||
| Net loss and comprehensive loss | $ | (153,942) | $ | (17,867) | $ | (136,075) | |||||||||||
_________________________
(1)Includes related party amount of $23,653 for the twelve months ended December 31, 2025 and $13,185 for the period from September 19, 2024 (inception) through December 31, 2024.
(2)Includes related party amount of $720 for the twelve months ended December 31, 2025 and $571 for the period from September 19, 2024 (inception) through December 31, 2024.
(3)Includes related party amount of $865 for the twelve months ended December 31, 2025 and $341 for the period from September 19, 2024 (inception) through December 31, 2024.
License Revenue
The following table summarizes our license revenue generated for the periods presented (in thousands):
| Three Months Ended December 31, 2025 | Period from September 19, 2024 (Inception) Through December 31, 2024 | $ Change | |||||||||||||||
|
License revenue
|
$ | 10,844 | $ | - | $ | 10,844 | |||||||||||
Revenue of $10.8 million for the twelve months ended December 31, 2025 consisted of amounts earned for the licensing of CR-001.
Research and Development Expenses
The following table summarizes our research and development expenses incurred for the periods presented (in thousands):
| Twelve Months Ended December 31, 2025 | Period from September 19, 2024 (Inception) Through December 31, 2024 | $ Change | |||||||||||||||
| External research and development costs by selected target: | |||||||||||||||||
|
CR-001(1)
|
$ | 26,437 | $ | 10,510 | $ | 15,927 | |||||||||||
|
CR-002(2)
|
14,026 | 3,251 | 10,775 | ||||||||||||||
|
CR-003
|
78,170 | - | 78,170 | ||||||||||||||
|
Other external research and discovery(3)
|
2,212 | - | 2,212 | ||||||||||||||
| Other research and development costs: | |||||||||||||||||
|
Personnel-related (including share-based compensation)(4)
|
16,464 | 61 | 16,403 | ||||||||||||||
|
Office, facilities, and software(5)
|
713 | 5 | 708 | ||||||||||||||
| Professional and consulting fees | 64 | 207 | (143) | ||||||||||||||
| Total research and development expenses | $ | 138,086 | $ | 14,034 | $ | 124,052 | |||||||||||
_________________________
(1)Includes related party amount of $6,787 for the twelve months ended December 31, 2025 and $9,868 for the period from September 19, 2024 (inception) through December 31, 2024.
(2)Includes related party amount of $10,531 for the twelve months ended December 31, 2025 and $3,251 for the period from September 19, 2024 (inception) through December 31, 2024.
(3)Includes related party amount of $2,039 for the twelve months ended December 31, 2025.
(4)Includes related party amount of $4,297 for the twelve months ended December 31, 2025 and $61 for the period from September 19, 2024 (inception) through December 31, 2024.
(5)Includes related party amounts of $5 for the period from September 19, 2024 (inception) through December 31, 2024.
Research and development expenses were $138.1 million for the twelve months ended December 31, 2025 and consisted primarily of the following:
•$6.8 million of research and development expense due to Paragon for services rendered under the Paragon Option Agreement and the CR-001 License Agreement for CR-001;
•$13.4 million of research and development expense related to chemistry, manufacturing, and development costs for CR-001 with a third-party contract development and manufacturing organization;
•$6.2 million of research and development expense related to third-party contract research organizations and consulting services for CR-001;
•$10.5 million of research and development expense due to Paragon for services rendered under the ADC Paragon Option Agreement and the CR-002 License Agreement for CR-002;
•$78.2 million of research and development expense related to licensing fees for CR-003 under our agreement with Kelun;
•$2.2 million of external research and discovery expense, including $2.0 million due to Paragon for services rendered under the ADC Paragon Option Agreement for discovery efforts related to Former CR-003; and
•$16.5 million of personnel-related costs related to recruiting costs, salaries, benefits, and other compensation-related costs, including share-based compensation expense of $6.6 million.
Research and development expenses were $14.0 million for the period from September 19, 2024 (inception) through December 31, 2024 and consisted primarily of early research and development costs with Paragon under the Antibody Paragon Option Agreement.
General and Administrative Expenses
The following table summarizes our total general and administrative expenses for the periods presented (in thousands):
| Twelve Months Ended December 31, 2025 | Period from September 19, 2024 (Inception) Through December 31, 2024 | $ Change | |||||||||||||||
|
Personnel-related (including share-based compensation)(1)
|
$ | 14,557 | $ | 1,153 | $ | 13,404 | |||||||||||
|
Professional and consulting fees(2)
|
7,206 | 1,774 | 5,432 | ||||||||||||||
|
Office, facilities, and software(3)
|
2,862 | 83 | 2,779 | ||||||||||||||
|
Legal fees related to patent(4)
|
765 | 147 | 618 | ||||||||||||||
| Total general and administrative expenses | $ | 25,390 | $ | 3,157 | $ | 22,233 | |||||||||||
_________________________
(1)Includes related party amount of $213 for the twelve months ended December 31, 2025.
(2)Includes related party amount of $150 for the twelve months ended December 31, 2025 and $405 for the period from September 19, 2024 (inception) through December 31, 2024.
(3)Includes related party amount of $26 for the period from September 19, 2024 (inception) through December 31, 2024.
(4)Includes related party amount of $358 for the twelve months ended December 31, 2025 and $140 for the period from September 19, 2024 (inception) through December 31, 2024.
General and administrative expenses were $25.4 million for the twelve months ended December 31, 2025 and consisted primarily of the following:
•$14.6 million of personnel-related costs related to recruiting costs, salaries, benefits, and other compensation-related costs, including share-based compensation of $6.7 million;
•$7.2 million of professional and consulting fees associated with accounting, audit, investor and public relations, and legal fees due to an increase in our business activity and as we became a public company; and
•$0.8 million of office, facilities, and software expenses associated with operating our Waltham facility lease and certain expenses associated with operating as a public company.
General and administrative expenses were $3.2 million for the period from September 19, 2024 (inception) through December 31, 2024 and consisted primarily of early general and administrative costs relating to personnel expenses, professional and consulting fees, and legal fees related to patents.
Interest Income
The following table summarizes our interest income for the periods presented (in thousands):
| Twelve Months Ended December 31, 2025 | Period from September 19, 2024 (Inception) Through December 31, 2024 | $ Change | |||||||||||||||
|
Interest income
|
2,875 | 176 | 2,699 | ||||||||||||||
Interest income increased by $2.7 million for the twelve months ended December 31, 2025, compared to the period from September 19, 2024 (inception) through December 31, 2024, due to increased levels of cash, cash equivalents, and marketable securities as of December 31, 2025 as compared to December 31, 2024.
Interest Expense
The following table summarizes our interest expense for the periods presented (in thousands):
| Twelve Months Ended December 31, 2025 | Period from September 19, 2024 (Inception) Through December 31, 2024 | $ Change | |||||||||||||||
|
Interest expense
|
(2,185) | (852) | (1,333) | ||||||||||||||
Interest expense for the twelve months ended December 31, 2025 and the period from September 19, 2024 (inception) through December 31, 2024 related to our previously outstanding Convertible Notes with an initial principal amount of $37.5 million issued to various investors in October 2024, which converted to common stock (now, ordinary shares) and pre-funded warrants upon the close of the Merger. No further interest expense is expected following the conversion of the Convertible Notes.
Liquidity and Capital Resources
Sources of Liquidity
Since our inception, we have incurred significant operating losses. We expect to incur significant expenses and operating losses for the foreseeable future as we continue the preclinical development of our programs and commence clinical development of CR-001, CR-002, and CR-003. We have not yet commercialized any products and we do not expect to generate revenue from sales of products for several years, if at all. To date, we have funded our operations primarily with proceeds from the issuance of Series Seed convertible preferred stock, common stock, and pre-funded warrants, and the sale of our Convertible Notes. In September 2024, we issued and sold 20,000,000 shares of Series Seed Preferred Stock to Fairmount, through an affiliate fund, at a purchase price of $0.20 per share, for total gross proceeds of $4.0 million, which qualified as a related party transaction. In October 2024, we received $37.5 million in net proceeds from the issuance of Convertible Notes to several investors, of which Fairmount, through an affiliate fund, held a convertible note with an initial principal amount of $15.0 million, which qualified as a related party transaction. In June 2025, we raised approximately $142.3 million in net proceeds from the Pre-Closing Financing, excluding the previously received proceeds from the Convertible Notes, and received $1.3 million in cash from GlycoMimetics upon consummation
of the Merger. In December 2025, we raised approximately $171.9 million in net proceeds from the Private Placement. As of December 31, 2025, we had cash and cash equivalents of $213.2 million.
Our primary use of cash is to fund the development of our product candidates and advance our pipeline. This includes both the research and development costs and the general and administrative expenses required to support those operations. Because we are a clinical-stage biotechnology company, we have incurred significant operating losses since our inception and we anticipate such losses to increase as we continue to pursue clinical development of our product candidates, prepare for the potential commercialization of our product candidates, and expand our development efforts in our pipeline of nonclinical candidates. We expect that our existing cash will be sufficient to fund our operating plans for at least twelve months from this Annual Report. We will need to secure additional financing in the future to fund additional research and development and before a commercial drug can be produced, marketed, and sold. If we are unable to obtain additional financing or generate license or product revenue, the lack of liquidity could have a material adverse effect on our Company and our operations.
Cash Flows
The following table summarizes our cash flows for the period presented (in thousands):
|
Twelve Months Ended December 31, 2025 |
Period from September 19, 2024 (Inception) Through December 31, 2024 | ||||||||||
| Net cash used in operating activities | $ | (71,532) | $ | (6,269) | |||||||
| Net cash used in investing activities | (72,919) | - | |||||||||
| Net cash provided by financing activities | 322,984 | 41,035 | |||||||||
|
Net increase in cash, cash equivalents, and restricted cash
|
$ | 178,533 | $ | 34,766 | |||||||
Net Cash Used in Operating Activities
For the twelve months ended December 31, 2025, net cash used in operating activities increased by $65.3 million to $71.5 million, compared to $6.3 million for the period from September 19, 2024 (inception) through December 31, 2024.
Net cash used in operating activities for the twelve months ended December 31, 2025 were primarily attributable to a net loss of $153.9 million and net cash used in changes in operating activities of $13.4 million, partially offset by non-cash charges of $95.8 million. The changes in operating activities were primarily due to an increase in our business activity, timing of vendor invoicing and payments, and the receivable due from Kelun for the CR-001 License. Non-cash charges primarily consisted of $80.0 million in research and development license expense, $13.3 million in share-based compensation expense, and $2.2 million of non-cash interest expense.
Net cash used in operating activities for the period from September 19, 2024 (inception) through December 31, 2024 were primarily attributable to a net loss of $17.9 million, offset by non-cash charges of $2.1 million and net cash provided by changes in operating activities of $9.5 million. Changes in operating activities were primarily due to an increase in our business activity as well as the timing of vendor invoicing and payments. Non-cash charges primarily consisted of $1.1 million of share-based compensation and $1.0 million in non-cash research and development expense.
Cash Used in Investing Activities
For the twelve months ended December 31, 2025, net cash used in investing activities increased by $72.9 million to $72.9 million, compared to $0 for the period from September 19, 2024 (inception) through December 31, 2024.
Net cash used in investing activities for the twelve months ended December 31, 2025 were primarily attributable to $72.0 million for the purchase of a research and development license, as well as purchases of property and equipment associated with the build-out of the sublease of office space located in Waltham, Massachusetts.
Net Cash Provided by Financing Activities
For the twelve months ended December 31, 2025, net cash provided by financing activities increased by $281.9 million to $323.0 million, compared to $41.0 million for the period from September 19, 2024 (inception) through December 31, 2024.
Net cash provided by financing activities for the twelve months ended December 31, 2025 were primarily attributable to $143.0 million of net proceeds from the Pre-Closing Financing, $178.9 million of net proceeds from the Private Placement, and $1.3 million of cash acquired in connection with the reverse recapitalization, partially offset by the repurchase of restricted stock awards of $0.2 million.
Net cash provided by financing activities for the period from September 19, 2024 (inception) through December 31, 2024 were primarily attributable to $37.5 million of gross proceeds from the issuance of the Convertible Notes, $4.0 million of net proceeds from the issuances of Series Seed Preferred Stock and $0.3 million of proceeds from the issuance of common stock, offset by $0.8 million in payments of deferred offering costs.
Contractual Obligations and Other Commitments
We enter into contracts in the normal course of business with contract research organizations ("CROs"), contract manufacturing organizations ("CMOs"), and with other vendors for preclinical research studies, clinical trials, manufacturing, and other services and products for operating purposes. These contracts generally provide for termination on notice or may have a potential termination fee if the contract is cancelled within a specified time, and therefore, are cancellable contracts. We do not expect any such contract terminations and did not have any non-cancellable obligations under these agreements as of December 31, 2025. See Notes 11, 12, and 13 to the consolidated financial statements included in Part II, Item 8 of this Annual Report for further information on our contractual lease obligations for our office in Waltham, Massachusetts, and other commitments, including the commitments under the Paragon Option and License Agreements. See Note 18 to the consolidated financial statements included in Part II, Item 8 of this Annual Report for further information on certain contracts executed subsequent to December 31, 2025.
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 consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported revenues recognized and expenses incurred during the reporting periods. Our estimates are based on historical experience and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
While our significant accounting policies are described in more detail in Note 2 to our consolidated financial statements for the twelve months ended months ended December 31, 2025 included in Part II, Item 8 of this Annual Report, we believe the following accounting policies used in the preparation of our consolidated financial statements require the most significant judgments and estimates.
Research and Development Contract Costs Accruals
We record the costs associated with research studies and manufacturing development as incurred. These costs are a significant component of our research and development expenses, with a substantial portion of our ongoing research and development activities conducted by third-party service providers, including contract research organizations and contract manufacturing organizations, and our related party Paragon.
We accrue for expenses resulting from obligations under Paragon Option Agreements among Paragon, Parascent, and us and agreements with CROs, CMOs, and other outside service providers for which payment flows do not match the periods over which materials or services are provided to us. Accruals are recorded based on estimates of services received and efforts expended pursuant to agreements established with Paragon, CROs, CMOs, and other outside service providers. These estimates are typically based on contracted amounts applied to the proportion of work performed and determined through analysis with internal personnel and external service providers as to the progress or stage of completion of the services. We make significant judgments and estimates in determining the accrual balance in each reporting period. In the event advance payments are made to Paragon, a CRO, CMO, or outside service provider, the payments will be recorded as a prepaid asset which will be expensed as the contracted services are performed. Changes in these estimates that result in material changes to our accruals could materially affect its results of operations. As of December 31, 2025, we have not experienced any material deviations between accrued and actual research and development expenses.
Revenue recognition
We account for revenue in accordance with ASC 606, Revenue from Contracts with Customers("ASC 606").
Our revenue is derived from our license agreement for CR-001 and recognized upon satisfaction of the performance obligations under the terms of a contract and control of our products and services is transferred to our customers in an amount that reflects the consideration we expect to receive from our customers in exchange for those products and services. This process involves (i) identifying the contract with a customer, (ii) determining the performance obligations in the contract, (iii) determining the contract price, (iv) allocating the contract price to the distinct performance obligations in the contract based on standalone selling price, and (v) recognizing revenue when the performance obligations have been satisfied. A performance obligation is considered distinct from other obligations in a contract when it provides a benefit to the customer either on its own or together with other resources that are readily available to the customer and is separately identified in the contract. We consider a performance obligation satisfied once we have transferred control of a good or service to the customer, meaning the customer has the ability to use and obtain the benefit of the good or service.
Our agreements with customers can include multiple performance obligations, which can sometimes be included in separate contracts entered into within a reasonably short period of time. We consider an entire customer arrangement to determine if separate contracts should be considered combined for the purposes of revenue recognition.
In order to determine the stand-alone selling price, we conduct an analysis to determine whether various goods or services have an observable stand-alone selling price. If we do not have an observable stand-alone selling price for a particular good or service, then the standalone selling price for that particular good or service is estimated using an approach that maximizes the use of observable inputs. Our process for determining stand-alone selling price requires judgment and considers multiple factors that are reasonably available and maximizes the use of observable inputs that may vary over time depending upon the unique facts and circumstances related to each performance obligation. We believe that this method results in an estimate that represents the price we would charge for the product offerings if they were sold separately.
For further details on the license agreement for CR-001 from which revenue is derived, refer to Note 12 to our consolidated financial statements for the twelve months ended months ended December 31, 2025 included in Part II, Item 8 of this Annual Report
Share-Based Compensation
We measure share-based awards granted to employees, directors, and non-employees in the form of stock options to purchase our ordinary shares, based on their fair value on the date of the grant using the Black-Scholes model. We measure ordinary share awards, restricted stock awards, and restricted stock units using the difference, if any, between the purchase price per share of the award and the fair value of our ordinary shares at the date of grant. Compensation expense for those awards is recognized using the straight-line method over the requisite service period, which is generally the vesting period of the respective award for employees. Compensation expense for awards to non-employees with service-based vesting conditions is recognized in the same manner as if we had paid cash in exchange for the goods or services, which is generally over the vesting period of the award. We account for forfeitures as they occur. We classify share-based compensation expenses in the same manner in which the award recipient's payroll costs are classified or in which the award recipient's service payments are classified.
The Black-Scholes model uses inputs that are determined by our Board on the date of grant and assumptions we make for the volatility of share-based awards, the expected term of share-based awards, the risk-free interest rate for a period that approximates the expected term of our share-based awards, and its expected dividend yield. We lack sufficient company-specific historical and implied volatility information of our shares. Therefore, we estimate its expected share volatility based on the historical volatility of a representative group of public companies in the biotechnology industry for a term equal to the remaining time of the expected term. The expected term of our stock options has been determined utilizing the "simplified" method for awards that qualify as "plain-vanilla" stock options. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve for time periods approximately equal to the remaining contractual term of the options on the date of measurement. We have estimated a 0% dividend yield based on the expected dividend yield and the fact that we have never paid, and do not expect to pay, any cash dividends in the foreseeable future. See Note 2 and Note 9 to the consolidated financial statements included in Part II, Item 8 of this Annual Report for information concerning specific assumptions we used in applying the Black-Scholes model to determine the estimated fair value of our stock options granted in the periods presented.
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 the consolidated financial statements as of December 31, 2025 included in Part II, Item 8 of this Annual Report.
Off-Balance Sheet Arrangements
As of December 31, 2025, we did not have any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.
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