[Cautionary Note Regarding Forward-Looking Statements](index=3&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD%20LOOKING%20STATEMENTS) [Forward-Looking Statements Overview](index=3&type=section&id=Forward-Looking%20Statements%20Overview) This section outlines the nature and inherent risks of forward-looking statements, which are future predictions - Forward-looking statements cover areas such as maintaining/increasing product sales, developing product candidates, obtaining/maintaining regulatory approval, government and third-party payer coverage, manufacturing capabilities, market size, debt obligations, financial performance (gross margins, cash reserves, R&D, SG&A), strategic plans, clinical study timing/results, potential earnout payments from UDENYCA divestiture, intellectual property, litigation outcomes, and competitive landscape[7](index=7&type=chunk)[10](index=10&type=chunk) - These statements are based on current expectations but are not guarantees of future performance and involve risks, uncertainties, and assumptions that are difficult to predict[8](index=8&type=chunk) - The company does not undertake any obligation to update these statements after the report's distribution, except as required by federal securities laws[8](index=8&type=chunk) [Part I. Financial Information](index=7&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section presents unaudited financial statements and management's discussion and analysis [Item 1. Unaudited Condensed Consolidated Financial Statements](index=7&type=section&id=ITEM%201%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section presents unaudited financial statements and related notes for the reporting period [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the company's financial position, detailing assets, liabilities, and equity Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :------------------ | | **Assets** | | | | Cash and cash equivalents | $216,893 | $125,987 | | Investments in marketable securities | $20,744 | — | | Trade receivables, net | $5,109 | $111,324 | | TSA receivables, net | $114,530 | $11,010 | | Inventory | $4,513 | $4,207 | | Total current assets | $380,205 | $341,583 | | Total assets | $439,464 | $448,533 | | **Liabilities and Stockholders' Equity (Deficit)** | | | | Accounts payable | $37,622 | $28,456 | | Accrued rebates, fees and reserves | $96,814 | $164,867 | | TSA payables and accrued liabilities | $103,999 | $11,026 | | Total current liabilities | $263,629 | $282,981 | | Convertible notes, non-current | — | $228,229 | | Total liabilities | $319,637 | $580,523 | | Total stockholders' equity (deficit) | $119,827 | $(131,990) | | Total liabilities and stockholders' equity (deficit) | $439,464 | $448,533 | - Total assets decreased slightly from **$448.5 million** at December 31, 2024, to **$439.5 million** at June 30, 2025[12](index=12&type=chunk) - Total liabilities significantly decreased from **$580.5 million** to **$319.6 million**, primarily due to the repayment of convertible notes[12](index=12&type=chunk) - Stockholders' equity shifted from a deficit of **$(132.0) million** to a positive **$119.8 million**[12](index=12&type=chunk) [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section details the company's financial performance, including revenue, expenses, and net income Condensed Consolidated Statements of Operations (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net revenue | $10,254 | $10,296 | $17,853 | $12,604 | | Total costs and expenses | $55,740 | $49,922 | $108,774 | $120,017 | | Loss from operations | $(45,486) | $(39,626) | $(90,921) | $(107,413) | | Net loss from continuing operations | $(44,862) | $(54,851) | $(92,260) | $(122,887) | | Net income from discontinued operations, net of tax | $342,629 | $41,930 | $333,458 | $212,841 | | Net income (loss) | $297,767 | $(12,921) | $241,198 | $89,954 | | Net income (loss) per share - basic and diluted | $2.57 | $(0.11) | $2.08 | $0.79 | - Net income significantly improved to **$297.8 million** for the three months ended June 30, 2025, compared to a net loss of **$(12.9) million** in the prior year, primarily driven by a substantial net income from discontinued operations of **$342.6 million**[13](index=13&type=chunk) - For the six months ended June 30, 2025, net income was **$241.2 million**, up from **$89.9 million** in the prior year, also largely due to discontinued operations[13](index=13&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) This section presents net income or loss and other comprehensive income for the reporting periods Condensed Consolidated Statements of Comprehensive Income (Loss) (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income (loss) | $297,767 | $(12,921) | $241,198 | $89,954 | | Other comprehensive income (loss): Unrealized loss on available-for-sale securities, net of tax | — | — | — | $(24) | | Comprehensive income (loss) | $297,767 | $(12,921) | $241,198 | $89,930 | - Comprehensive income for the three and six months ended June 30, 2025, significantly increased to **$297.8 million** and **$241.2 million**, respectively, compared to the prior year periods, mirroring the improvements in net income[15](index=15&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity (Deficit)](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity%20(Deficit)) This section outlines changes in stockholders' equity or deficit, reflecting transactions and net income Condensed Consolidated Statements of Stockholders' Equity (Deficit) (in thousands) | Metric | December 31, 2024 | March 31, 2025 | June 30, 2025 | | :------------------------------------------ | :------------------ | :------------- | :------------ | | Total Stockholders' Equity (Deficit) | $(131,990) | $(183,470) | $119,827 | | Accumulated Deficit | $(1,550,993) | $(1,607,562) | $(1,309,795) | | Common Stock Shares Outstanding | 115,614,548 | 115,907,216 | 116,222,726 | - Total stockholders' equity (deficit) improved from a deficit of **$(131.99) million** at December 31, 2024, to a positive **$119.83 million** at June 30, 2025, primarily due to net income generated during the period[17](index=17&type=chunk) - The accumulated deficit decreased from **$(1,550.99) million** to **$(1,309.80) million** over the six months, reflecting the period's net income[17](index=17&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section presents cash inflows and outflows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Net cash (used in) provided by operating activities | $(72,458) | $12,968 | | Net cash provided by investing activities | $445,152 | $230,419 | | Net cash used in financing activities | $(281,788) | $(187,038) | | Net increase in cash, cash equivalents and restricted cash | $90,906 | $56,349 | | Cash, cash equivalents and restricted cash at end of period | $217,156 | $159,692 | - Net cash used in operating activities was **$(72.5) million** for the six months ended June 30, 2025, a significant change from **$13.0 million** provided in the prior year, primarily due to the adjustment for the net gain on Sale Transactions[18](index=18&type=chunk)[162](index=162&type=chunk) - Net cash provided by investing activities increased to **$445.2 million**, up from **$230.4 million**, largely driven by **$483.4 million** cash received from the UDENYCA Sale[18](index=18&type=chunk)[165](index=165&type=chunk) - Net cash used in financing activities increased to **$(281.8) million**, up from **$(187.0) million**, mainly due to the repayment of 2026 Convertible Notes and the UDENYCA Buy-out[18](index=18&type=chunk)[167](index=167&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the financial statements [1. Organization and Summary of Significant Accounting Policies](index=12&type=section&id=1.%20Organization%20and%20Summary%20of%20Significant%20Accounting%20Policies) This section details the company's organizational structure and significant accounting policies - Coherus Oncology, Inc. changed its name from Coherus BioSciences, Inc. on **May 29, 2025**, to align with its exclusive focus on proprietary innovative immuno-oncology medicines, following the divestiture of its biosimilar businesses[20](index=20&type=chunk) - The company completed the divestiture of the UDENYCA franchise to Intas for **$483.4 million** cash on **April 11, 2025**, and is eligible for two additional **$37.5 million** earnout payments based on future net sales thresholds[21](index=21&type=chunk) - The UDENYCA Sale, along with previous YUSIMRY and CIMERLI sales, represents a strategic shift, leading to the classification of these operations as discontinued in the financial statements[21](index=21&type=chunk)[33](index=33&type=chunk) - The One Big Beautiful Bill Act (OBBBA) was signed into law on **July 4, 2025**, allowing immediate expensing of domestic R&D and **100% bonus depreciation**, with impacts to be reflected starting **Q3 2025**[35](index=35&type=chunk) [2. Revenue](index=17&type=section&id=2.%20Revenue) This section details revenue recognition policies and provides a breakdown of net revenue sources Net Revenue from Continuing Operations (in thousands) | Product | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | LOQTORZI | $9,959 | $3,789 | $17,307 | $5,777 | | Other revenue | $295 | $6,507 | $546 | $6,827 | | Total net revenue | $10,254 | $10,296 | $17,853 | $12,604 | - LOQTORZI net revenue increased by **$6.17 million (162.8%)** for the three months and **$11.53 million (199.6%)** for the six months ended June 30, 2025, compared to the prior year, driven by volume growth since its **December 2023** launch[39](index=39&type=chunk)[129](index=129&type=chunk) - Other revenue decreased significantly due to a **$6.3 million** sale of rights to commercialize toripalimab in Canada on **June 27, 2024**[39](index=39&type=chunk)[129](index=129&type=chunk) Gross Product Revenues by Significant Customers (Continuing Operations) | Customer | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | McKesson Corporation | 44% | 44% | 45% | 39% | | Cencora (AmeriSource Bergen) | 39% | 45% | 37% | 44% | | Cardinal Health, Inc. | 15% | 11% | 17% | 15% | [3. Fair Value Measurements](index=19&type=section&id=3.%20Fair%20Value%20Measurements) This section describes methodologies and inputs for fair value measurements of financial instruments - The company classifies financial instruments into **Level 1, 2, or 3** based on input observability[44](index=44&type=chunk)[48](index=48&type=chunk) - Contingent consideration liabilities related to CVRs from the Surface Oncology acquisition are **Level 3** measurements, determined using Monte Carlo simulations[46](index=46&type=chunk) - The Royalty Fee Derivative Liability, embedded in the Revenue Purchase and Sale Agreement, is also a **Level 3** measurement, with its fair value estimated using Monte Carlo simulation models[47](index=47&type=chunk) - Its fair value decreased from **$13.6 million** at December 31, 2024, to **$1.5 million** at June 30, 2025, partly due to the derecognition of the UDENYCA portion[49](index=49&type=chunk) [4. Inventory](index=21&type=section&id=4.%20Inventory) This section provides details on the composition and valuation of the company's inventory assets Inventory (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------- | :------------ | :------------------ | | Finished goods | $4,513 | $4,207 | | Prepaid manufacturing | $6,700 | $6,653 | - Inventory consisted entirely of finished goods, increasing slightly from **$4.2 million** to **$4.5 million**[51](index=51&type=chunk)[52](index=52&type=chunk) - Prepaid manufacturing remained stable at approximately **$6.7 million**, with **$1.1 million** expected to convert to inventory within **12 months** and **$5.6 million** for R&D[51](index=51&type=chunk)[52](index=52&type=chunk) [5. Balance Sheet Components](index=21&type=section&id=5.%20Balance%20Sheet%20Components) This section provides detailed breakdowns of property, intangible, and liability components Property and Equipment, Net (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :------------------ | | Total property and equipment, net - subtotal | $1,907 | $2,837 | | Less: Property and equipment, net from discontinued operations | — | $(261) | | Property and equipment, net | $1,907 | $2,576 | Intangible Assets, Net (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :------------------ | | Finite-lived assets, net | $23,453 | $24,787 | | Indefinite-lived assets - in-process R&D | $28,859 | $28,859 | | Total Intangible assets, net | $52,312 | $53,646 | - Property and equipment, net, decreased from **$2.58 million** to **$1.91 million**[53](index=53&type=chunk) - Intangible assets, net, decreased from **$53.65 million** to **$52.31 million**, with amortization expense of **$1.3 million** for the six months ended June 30, 2025[55](index=55&type=chunk)[56](index=56&type=chunk) - Accrued and other current liabilities significantly decreased from **$60.29 million** to **$14.18 million**, primarily due to the derecognition of the Royalty Fee Derivative Liability (current portion) and accrued co-development costs/milestone payments[58](index=58&type=chunk) - Other liabilities, non-current, decreased from **$29.33 million** to **$16.74 million**, mainly due to a reduction in revenue participation liability[59](index=59&type=chunk) [6. Discontinued Operations](index=22&type=section&id=6.%20Discontinued%20Operations) This section details the financial impact and strategic rationale behind discontinued operations - The company completed the divestiture of the UDENYCA Business on **April 11, 2025**, for **$483.4 million** cash, recognizing a net gain of **$339.1 million**[60](index=60&type=chunk) - Two additional earnout payments of **$37.5 million** each are possible based on future UDENYCA net sales[60](index=60&type=chunk) - Previous divestitures include the YUSIMRY franchise (**June 26, 2024**, for **$40.0 million** cash) and the CIMERLI ophthalmology franchise (**March 1, 2024**, for **$187.8 million** cash)[61](index=61&type=chunk)[63](index=63&type=chunk) - These divestitures represent a strategic shift, leading to the classification of these businesses as discontinued operations for all periods presented[64](index=64&type=chunk) Net Income from Discontinued Operations (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net revenue | $23,094 | $54,683 | $55,228 | $129,438 | | Net income from discontinued operations, net of tax | $342,629 | $41,930 | $333,458 | $212,841 | - Net income from discontinued operations for the six months ended June 30, 2025, was **$333.5 million**, significantly higher than **$212.8 million** in the prior year, primarily due to the UDENYCA divestiture gain[66](index=66&type=chunk) [7. Collaborations and Other Arrangements](index=26&type=section&id=7.%20Collaborations%20and%20Other%20Arrangements) This section outlines key collaboration agreements and other contractual arrangements - The company amended its Collaboration Agreement with Junshi Biosciences, revising the **$25.0 million** milestone payment for LOQTORZI's FDA approval into two **$12.5 million** installments, with the second paid in **January 2025**[72](index=72&type=chunk) - Accrued royalty obligation to Junshi Biosciences was **$2.0 million** as of June 30, 2025, up from **$1.5 million** at December 31, 2024[74](index=74&type=chunk) [8. Financial Liabilities](index=26&type=section&id=8.%20Financial%20Liabilities) This section provides a detailed overview of the company's debt and other financial liabilities Summary of Debt Obligations (in thousands) | Debt Type | Principal Amount (June 30, 2025) | Carrying Value (June 30, 2025) | Principal Amount (Dec 31, 2024) | Carrying Value (Dec 31, 2024) | | :-------------------- | :------------------------------- | :----------------------------- | :------------------------------ | :------------------------------ | | 2029 Term Loan | $38,660 | $36,867 | $38,660 | $36,698 | | 2026 Convertible Notes | $121 | $121 | $230,000 | $228,229 | - The **2029 Term Loan**, entered into on **May 8, 2024**, for **$38.7 million**, matures on **May 8, 2029**, with interest at **8.0%** plus three-month SOFR[76](index=76&type=chunk)[77](index=77&type=chunk) - The company repurchased **$170.0 million** of 2026 Convertible Notes on **April 15, 2025**, and an additional **$59.9 million** on **May 15, 2025**, reducing the outstanding principal to **$0.1 million** as of June 30, 2025[91](index=91&type=chunk) - A **$4.7 million** loss on debt extinguishment was recorded[91](index=91&type=chunk) - The Revenue Purchase and Sale Agreement involved a **$37.5 million** payment to the company in exchange for rights to **5.0%** of U.S. net sales of UDENYCA and LOQTORZI[79](index=79&type=chunk) - The UDENYCA portion was bought out for **$47.7 million** on **April 15, 2025**[81](index=81&type=chunk) [9. Commitments and Contingencies](index=31&type=section&id=9.%20Commitments%20and%20Contingencies) This section details contractual commitments and potential contingent legal liabilities Non-Cancelable Purchase Commitments (in thousands) | Year Ending December 31, | Amount | | :----------------------- | :----- | | 2025 | $8,195 | | 2026 | $260 | | Total obligations | $8,455 | - The company has non-cancelable purchase commitments totaling **$8.46 million**, primarily for manufacturing services, with the majority (**$8.20 million**) due in **2025**[93](index=93&type=chunk) - An accrual of **$6.4 million** was established as of June 30, 2025, for legal proceedings and claims, including a demand letter from Zinc Health Services, LLC for approximately **$14.0 million** related to UDENYCA sales[95](index=95&type=chunk)[96](index=96&type=chunk) [10. Stockholders' Equity (Deficit)](index=33&type=section&id=10.%20Stockholders'%20Equity%20(Deficit)) This section details changes in stockholders' equity or deficit, including share issuances ATM Offering Summary (in thousands, except share and per share data) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Number of common stock shares sold | — | 650,005 | | Gross proceeds | — | $1,589 | | Net proceeds | — | $1,549 | - No shares were sold under the ATM Offering during the six months ended June 30, 2025[99](index=99&type=chunk) - Approximately **$64.9 million** of common stock remains available for sale under the ATM Offering as of June 30, 2025[99](index=99&type=chunk) [11. Stock-Based Compensation](index=33&type=section&id=11.%20Stock-Based%20Compensation) This section outlines stock-based compensation expense across R&D and administrative functions Stock-Based Compensation Expense (in thousands) | Classification | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Research and development | $2,131 | $2,266 | $3,841 | $4,460 | | Selling, general and administrative | $3,184 | $4,661 | $6,584 | $9,538 | | Total stock-based compensation expense from continuing operations | $5,166 | $6,859 | $10,212 | $13,675 | - Total stock-based compensation expense from continuing operations decreased by **$1.69 million** for the three months and **$3.46 million** for the six months ended June 30, 2025, compared to the prior year[100](index=100&type=chunk) [12. Net Income (Loss) Per Share](index=34&type=section&id=12.%20Net%20Income%20(Loss)%20Per%20Share) This section presents basic and diluted net income or loss per share from operations Net Income (Loss) Per Share (basic and diluted) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss from continuing operations - basic and diluted | $(0.39) | $(0.48) | $(0.80) | $(1.08) | | Net income from discontinued operations - basic and diluted | $2.95 | $0.37 | $2.88 | $1.87 | | Net income (loss) per share - basic and diluted | $2.57 | $(0.11) | $2.08 | $0.79 | - Diluted EPS from continuing operations improved from **$(0.48)** to **$(0.39)** for the three months and from **$(1.08)** to **$(0.80)** for the six months ended June 30, 2025[102](index=102&type=chunk) - Diluted EPS from discontinued operations significantly increased from **$0.37** to **$2.95** for the three months and from **$1.87** to **$2.88** for the six months ended June 30, 2025, primarily due to the UDENYCA divestiture gain[102](index=102&type=chunk) - Total diluted EPS was **$2.57** for the three months and **$2.08** for the six months ended June 30, 2025, a substantial improvement from **$(0.11)** and **$0.79**, respectively, in the prior year[102](index=102&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=35&type=section&id=ITEM%202%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition, operational results, and strategic shift to immuno-oncology [Overview](index=35&type=section&id=Overview) This section provides an overview of the company's strategic transformation to immuno-oncology - Coherus Oncology, Inc. is now a fully integrated commercial-stage innovative oncology company, focused on its approved PD-1 inhibitor, LOQTORZI, and two mid-stage clinical candidates (casdozokitug and CHS-114)[104](index=104&type=chunk) - The company changed its name from Coherus BioSciences, Inc. on **May 29, 2025**, to reflect its exclusive focus on immuno-oncology after divesting its biosimilar businesses[104](index=104&type=chunk) [Product and Product Candidates](index=35&type=section&id=Product%20and%20Product%20Candidates) This section details LOQTORZI and key immuno-oncology pipeline candidates - LOQTORZI (toripalimab-tpzi) was FDA-approved on **October 27, 2023**, for metastatic or recurrent locally advanced nasopharyngeal carcinoma (NPC) and launched in the U.S. on **January 2, 2024**[106](index=106&type=chunk) - It is the only preferred **Category 1** first-line treatment option for NPC in combination with chemotherapy, as per NCCN guidelines[106](index=106&type=chunk) - Casdozokitug (CHS-388) is an investigational IL-27 targeting antibody with Orphan Drug and Fast Track designations for hepatocellular carcinoma (HCC)[112](index=112&type=chunk) - It is currently in three clinical studies, including a **Phase 2** study in HCC and a randomized **Phase 2** study in combination with toripalimab and bevacizumab[112](index=112&type=chunk) - CHS-114 is an investigational CCR8-targeting antibody designed to deplete intra-tumoral Treg cells[112](index=112&type=chunk) - It is being evaluated in **Phase 1b** clinical studies in combination with toripalimab for second-line HNSCC and advanced solid tumors[112](index=112&type=chunk) - The company has an exclusive license from Junshi Biosciences for LOQTORZI in the U.S. and Canada, with potential milestone payments up to **$380.0 million** and low **twenty percent range** royalties on net sales[114](index=114&type=chunk) [Key Business Updates](index=39&type=section&id=Key%20Business%20Updates) This section summarizes recent business developments, including divestitures and debt management - The UDENYCA Sale was completed on **April 11, 2025**, for **$483.4 million** cash, with eligibility for two additional **$37.5 million** earnout payments[116](index=116&type=chunk) - On **April 15, 2025**, the company paid **$47.7 million** to buy out the UDENYCA portion of the Revenue Purchase and Sale Agreement, while the LOQTORZI portion remains active[117](index=117&type=chunk) - The company repurchased **$170.0 million** of 2026 Convertible Notes on **April 15, 2025**, and **$59.9 million** on **May 15, 2025**, leaving **$0.1 million** outstanding as of June 30, 2025[118](index=118&type=chunk) [Financial Operations Overview](index=40&type=section&id=Financial%20Operations%20Overview) This section provides an overview of key components and accounting treatments in financial operations - The UDENYCA Sale, as the last significant biosimilar divestiture, led to the classification of biosimilar businesses as discontinued operations[119](index=119&type=chunk) - Cost of goods sold includes third-party manufacturing, distribution, royalties (**low twenty percent range** on LOQTORZI net sales), and overhead[121](index=121&type=chunk) - Research and development expenses are recognized as incurred, with external costs primarily for collaborators, CROs, manufacturing supplies, and upfront/milestone payments[122](index=122&type=chunk)[123](index=123&type=chunk) - Internal costs cover personnel and facilities[123](index=123&type=chunk) - Selling, general and administrative expenses include personnel, allocated facilities, professional services, and commercialization costs for LOQTORZI, with TSA reimbursements reducing these expenses[126](index=126&type=chunk) - Interest expense includes interest on debt, Revenue Purchase and Sale Agreement, and non-cash amortization of debt discount/issuance costs[127](index=127&type=chunk) - Other income (expense), net, includes interest income, accretion of discount on marketable securities, foreign exchange gains/losses, changes in fair value of derivatives, and gains/losses from asset disposals[128](index=128&type=chunk) [Results of Operations](index=42&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance, including revenue, expenses, and net income Net Revenue (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | | :------- | :------------------------------- | :------------------------------- | :----- | | LOQTORZI | $9,959 | $3,789 | $6,170 | | Other revenue | $295 | $6,507 | $(6,212) | | Total net revenue | $10,254 | $10,296 | $(42) | - LOQTORZI net revenue increased by **$6.17 million (162.8%)** for the three months ended June 30, 2025, due to volume growth[129](index=129&type=chunk) - Other revenue decreased by **$6.21 million** due to the sale of Canadian commercialization rights[129](index=129&type=chunk) Cost of Goods Sold and Gross Margin (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | | :--------------- | :------------------------------- | :------------------------------- | :----- | | Cost of goods sold | $3,395 | $1,809 | $1,586 | | Gross margin | 67% | 82% | -15% | | Six Months Ended June 30, 2025 | $6,048 | $3,248 | $2,800 | | Gross margin | 66% | 74% | -8% | - Cost of goods sold increased by **$1.59 million (87.7%)** for the three months and **$2.80 million (86.2%)** for the six months, driven by LOQTORZI volume growth[131](index=131&type=chunk) - Gross margin decreased due to higher cost of goods sold relative to revenue[131](index=131&type=chunk) Research and Development Expense (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | | :------------------------ | :------------------------------- | :------------------------------- | :----- | | Research and development | $26,306 | $20,598 | $5,708 | | Six Months Ended June 30, 2025 | $50,662 | $49,022 | $1,640 | - R&D expense increased by **$5.71 million (27.7%)** for the three months, primarily due to increased development for casdozokitug (**$4.8 million**) and CHS-114 (**$4.0 million**), partially offset by decreases in facilities and co-development costs[133](index=133&type=chunk)[134](index=134&type=chunk) - R&D expense increased by **$1.64 million (3.3%)** for the six months, driven by CHS-114 (**$9.0 million**) and casdozokitug (**$6.8 million**) development, offset by reduced co-development costs for toripalimab/CHS-006 and lower personnel/infrastructure expenses[133](index=133&type=chunk)[134](index=134&type=chunk) Selling, General and Administrative Expense (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | | :-------------------------------- | :------------------------------- | :------------------------------- | :------- | | Selling, general and administrative | $26,039 | $27,515 | $(1,476) | | Six Months Ended June 30, 2025 | $52,064 | $67,747 | $(15,683) | - SG&A expense decreased by **$1.48 million (5.4%)** for the three months, mainly due to lower employee-related costs[136](index=136&type=chunk) - SG&A expense decreased by **$15.68 million (23.1%)** for the six months, primarily due to a **$6.8 million** impairment charge in **Q1 2024**, lower headcount-related costs (**$5.5 million**), and reduced professional fees and infrastructure expenses[137](index=137&type=chunk) Interest Expense (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | | :------------- | :------------------------------- | :------------------------------- | :------- | | Interest expense | $2,277 | $4,062 | $(1,785) | | Six Months Ended June 30, 2025 | $4,427 | $7,180 | $(2,753) | - Interest expense from continuing operations decreased by **$1.79 million (43.9%)** for the three months and **$2.75 million (38.3%)** for the six months, mainly due to the prepayment of 2027 Term Loans, partially offset by new interest on the 2029 Term Loan and LOQTORZI Revenue Purchase and Sale Agreement[139](index=139&type=chunk) Net Income from Discontinued Operations, net of tax (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | | :------------------------------------------ | :------------------------------- | :------------------------------- | :--------- | | Net income from discontinued operations, net of tax | $342,629 | $41,930 | $300,699 | | Six Months Ended June 30, 2025 | $333,458 | $212,841 | $120,617 | - Net income from discontinued operations increased by **$300.70 million (717.1%)** for the three months and **$120.62 million (56.7%)** for the six months, primarily due to the **$339.1 million** net gain on the UDENYCA divestiture in **April 2025**[146](index=146&type=chunk) [Liquidity and Capital Resources](index=46&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's cash position, capital resources, and ability to fund operations Liquidity and Capital Resources (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :------------------ | | Total Cash, cash equivalents and marketable securities | $237,637 | $125,987 | | Total Financial liabilities | $50,089 | $293,670 | - Cash, cash equivalents, and marketable securities increased to **$237.6 million** at June 30, 2025, from **$126.0 million** at December 31, 2024[148](index=148&type=chunk) - Total financial liabilities significantly decreased to **$50.1 million** from **$293.7 million**, primarily due to the repayment of 2026 Convertible Notes and the UDENYCA Buy-out[148](index=148&type=chunk)[149](index=149&type=chunk) - The company believes its available cash, product sales, and ATM Offering proceeds will fund operations for at least the next **twelve months**[152](index=152&type=chunk) - Key liquidity events include the UDENYCA Sale (**$483.4 million** cash), UDENYCA royalty buy-out (**$47.7 million** payment), 2026 Convertible Notes repurchases (**$229.9 million**), and the 2029 Term Loan (**$38.7 million** proceeds)[153](index=153&type=chunk) Summary Statement of Cash Flows (in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Net cash (used in) provided by operating activities | $(72,458) | $12,968 | | Net cash provided by investing activities | $445,152 | $230,419 | | Net cash used in financing activities | $(281,788) | $(187,038) | | Net increase in cash, cash equivalents and restricted cash | $90,906 | $56,349 | [Critical Accounting Policies and Significant Judgments and Estimates](index=52&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) This section outlines critical accounting policies and significant judgments and estimates - The preparation of financial statements requires management to make judgments, estimates, and assumptions affecting reported amounts of assets, liabilities, revenue, and expenses[170](index=170&type=chunk) - No significant changes to critical accounting estimates occurred during the six months ended June 30, 2025, compared to the **2024 Form 10-K**[171](index=171&type=chunk) [Recent Accounting Pronouncements](index=54&type=section&id=Recent%20Accounting%20Pronouncements) This section details evaluation of recent accounting pronouncements and their potential impact - The company is evaluating **ASU 2023-09** (Income Taxes) effective for annual periods after **December 15, 2024**, which enhances income tax disclosures[36](index=36&type=chunk) - The company is evaluating **ASU 2024-03** (Income Statement - Expense Disaggregation) effective for annual periods after **December 15, 2026**, which requires disaggregated disclosure of certain costs and expenses[37](index=37&type=chunk) [Item 3. Quantitative and Qualitative Disclosure About Market Risk](index=54&type=section&id=ITEM%203%20Quantitative%20and%20Qualitative%20Disclosure%20About%20Market%20Risk) As a smaller reporting company, the company elects not to provide disclosures on market risk - The company qualifies as a 'smaller reporting company' and has elected not to provide disclosures about market risk[173](index=173&type=chunk) [Item 4. Controls and Procedures](index=54&type=section&id=ITEM%204%20Controls%20and%20Procedures) This section evaluates disclosure controls and internal control, noting a material weakness - The company's disclosure controls and procedures were deemed not effective as of **June 30, 2025**, due to a material weakness in the operating effectiveness of procedures related to documentation and review of certain inventory account reconciliations[177](index=177&type=chunk)[179](index=179&type=chunk) - Despite the material weakness, management concluded that the condensed consolidated financial statements fairly present the financial condition, results of operations, and cash flows[177](index=177&type=chunk) - Remediation measures include additional training and enhancement of documentation procedures, but the deficient inventory control was decommissioned with the UDENYCA Sale, preventing retesting of its operating effectiveness[180](index=180&type=chunk) - No other changes in internal control over financial reporting materially affected, or are reasonably likely to materially affect, the company's internal control during the quarter ended **June 30, 2025**[181](index=181&type=chunk) [Part II. Other Information](index=55&type=section&id=PART%20II%20OTHER%20INFORMATION) This section includes legal proceedings, risk factors, equity sales, and other required disclosures [Item 1. Legal Proceedings](index=55&type=section&id=ITEM%201.%20Legal%20Proceedings) This section incorporates legal proceedings information by reference from Note 9 - Information on legal proceedings is incorporated by reference from **Note 9. Commitments and Contingencies**[182](index=182&type=chunk) [Item 1A. Risk Factors](index=55&type=section&id=ITEM%201A.Risk%20Factors) This section details significant risks impacting the company's business, financial condition, and prospects [Risk Factor Summary](index=55&type=section&id=Risk%20Factor%20Summary) This section provides a concise summary of the most critical risks facing the company - Key risks include limited profitability history, dependence on market acceptance of LOQTORZI, reliance on collaborators for development, ongoing regulatory scrutiny, potential disruptions at government agencies, intense competition from immuno-oncology biologics, healthcare reform impacts (e.g., IRA), dependence on key personnel, reliance on third-party CROs and manufacturers, manufacturing risks, and potential delisting from Nasdaq[183](index=183&type=chunk)[188](index=188&type=chunk) [Risks Related to Our Financial Condition and Capital Requirements](index=58&type=section&id=Risks%20Related%20to%20Our%20Financial%20Condition%20and%20Capital%20Requirements) This section outlines risks concerning financial stability, profitability, and capital funding - The company has a limited history of profitability, with significant operating losses in most years, and an accumulated deficit of **$1.3 billion** as of **June 30, 2025**[186](index=186&type=chunk)[187](index=187&type=chunk)[191](index=191&type=chunk) - Future profitability is uncertain, especially after the UDENYCA Sale[191](index=191&type=chunk) - Future expenses will increase substantially with commercialization efforts, R&D, manufacturing, regulatory approvals, and intellectual property protection[192](index=192&type=chunk) - The company is dependent on raising additional funds, which may not be available on acceptable terms, potentially forcing delays or termination of product development and commercialization efforts[194](index=194&type=chunk)[198](index=198&type=chunk) - Future funding requirements depend on factors like product sales, debt obligations, manufacturing costs, clinical trial progress, regulatory approvals, and potential earnout payments from the UDENYCA Business sale[156](index=156&type=chunk)[196](index=196&type=chunk) [Risks Related to Launch and Commercialization of our Product and our Product Candidates](index=62&type=section&id=Risks%20Related%20to%20Launch%20and%20Commercialization%20of%20our%20Product%20and%20our%20Product%20Candidates) This section addresses risks with product launch, market acceptance, and regulatory approvals - The company has a limited operating history in immuno-oncology, with LOQTORZI as its only approved product[199](index=199&type=chunk) - Generating meaningful revenue depends on successful marketing, regulatory approvals for pipeline candidates (casdozokitug, CHS-114, toripalimab in non-NPC indications), and market acceptance[200](index=200&type=chunk)[201](index=201&type=chunk) - Commercial success hinges on market acceptance by physicians, patients, and third-party payers, influenced by product safety, efficacy, side effects, clinical indications, competition, cost, and reimbursement policies[204](index=204&type=chunk)[206](index=206&type=chunk) - Failure to obtain or maintain adequate third-party coverage and reimbursement for LOQTORZI or future products could limit market access and revenue generation, with significant uncertainty surrounding new product reimbursement[209](index=209&type=chunk)[212](index=212&type=chunk)[213](index=213&type=chunk) - Approved products remain subject to ongoing regulatory requirements (manufacturing, labeling, promotion, post-marketing studies), and non-compliance could lead to sanctions, market withdrawal, or delays[216](index=216&type=chunk)[221](index=221&type=chunk) - Disruptions at the FDA and other government agencies (e.g., funding shortages, shutdowns) could hinder regulatory review and approval processes, negatively impacting the business[225](index=225&type=chunk)[227](index=227&type=chunk)[228](index=228&type=chunk) [Risks Related to Competitive Activity](index=72&type=section&id=Risks%20Related%20to%20Competitive%20Activity) This section details risks from intense competition in immuno-oncology and biosimilar entry - LOQTORZI faces significant competition in the immuno-oncology market from established anti-PD-1/PD-L1 antibody drugs (e.g., Keytruda, Opdivo) and other novel drugs in development[229](index=229&type=chunk)[230](index=230&type=chunk) - Casdozokitug and CHS-114, if approved, will also face competition from existing immuno-oncology products and other programs targeting similar mechanisms (e.g., CCR8)[231](index=231&type=chunk)[232](index=232&type=chunk) - Competitors often have greater financial, technical, and marketing resources, potentially leading to faster regulatory approvals, more effective sales, and the development of superior or lower-cost therapies[233](index=233&type=chunk)[234](index=234&type=chunk) - The BPCIA provides **12 years** of exclusivity for reference biologic products, but this could be shortened, or the company's products may not qualify, leading to earlier biosimilar competition[236](index=236&type=chunk)[239](index=239&type=chunk) [Risks Related to Our Ability to Hire and Retain Highly Qualified Personnel](index=75&type=section&id=Risks%20Related%20to%20Our%20Ability%20to%20Hire%20and%20Retain%20Highly%20Qualified%20Personnel) This section addresses risks related to attracting, retaining, and managing key personnel - The company is highly dependent on its key executives and scientific staff, including President and CEO Dennis M. Lanfear[240](index=240&type=chunk) - Loss of these individuals or inability to attract new qualified personnel could harm the business[240](index=240&type=chunk) - Difficulties in managing changes in employee numbers, particularly due to divestitures, reductions in force, and turnover (e.g., **51 employees** decreased since **Dec 31, 2024**), could disrupt operations and increase expenses[243](index=243&type=chunk)[245](index=245&type=chunk) [Risks Related to Reliance on Third Parties](index=77&type=section&id=Risks%20Related%20to%20Reliance%20on%20Third%20Parties) This section outlines risks associated with dependence on third-party manufacturers and partners - The company relies on single third-party manufacturers for nonclinical, clinical, and commercial drug supplies[246](index=246&type=chunk) - Failure to provide sufficient quantities, acceptable quality, or timely supply could harm the business[247](index=247&type=chunk) - Reliance on third-party manufacturers carries risks including regulatory non-compliance, breach of agreements, and termination, which could delay development or commercialization[248](index=248&type=chunk) - The company relies on third-party CROs for nonclinical and clinical studies[252](index=252&type=chunk) - Failure by CROs to meet contractual duties, deadlines, or regulatory requirements could delay or terminate studies and harm the business[253](index=253&type=chunk) - Dependence on Junshi Biosciences for LOQTORZI commercialization means that issues with their supply or collaboration could materially affect the business[255](index=255&type=chunk)[257](index=257&type=chunk) [Risks Related to Our Future Operations Following the UDENYCA Sale](index=81&type=section&id=Risks%20Related%20to%20Our%20Future%20Operations%20Following%20the%20UDENYCA%20Sale) This section addresses operational and financial risks following the UDENYCA sale - There is no guarantee of receiving the two **$37.5 million** earnout payments from the UDENYCA Sale, as they are contingent on specific net sales thresholds being met[259](index=259&type=chunk) - Risks associated with the UDENYCA Transition Services Agreement (TSA) include diverting management time, providing significant support services, and potential unanticipated costs[260](index=260&type=chunk)[262](index=262&type=chunk) [Risks Related to Manufacturing and Supply Chain](index=83&type=section&id=Risks%20Related%20to%20Manufacturing%20and%20Supply%20Chain) This section details risks concerning complex manufacturing, supply chain, and inventory - Manufacturing processes are complex and highly regulated, subject to risks like contamination, equipment failure, natural disasters, and supply chain disruptions, which could increase costs and limit supply[264](index=264&type=chunk)[265](index=265&type=chunk)[269](index=269&type=chunk) - Inaccurate sales forecasting can lead to excess or obsolete inventory, requiring write-downs and charges related to firm purchase commitments, impacting financial results[266](index=266&type=chunk)[267](index=267&type=chunk) - Reliance on single suppliers for manufacturing, clinical trials, and testing creates vulnerability; loss of any supplier could cause significant delays and adverse business impacts[271](index=271&type=chunk) - Contract manufacturers must comply with cGMP regulations and pass regulatory inspections[272](index=272&type=chunk) - Failure to do so could delay or prevent regulatory approval or lead to suspension of production[275](index=275&type=chunk) [Risks Related to Adverse Events](index=87&type=section&id=Risks%20Related%20to%20Adverse%20Events) This section outlines risks with undesirable side effects, product liability, and adverse events - Undesirable side effects from products or product candidates could delay or prevent regulatory approval, lead to restrictive labeling, or result in significant negative consequences post-marketing, including product liability lawsuits[278](index=278&type=chunk)[282](index=282&type=chunk) - Failure to report adverse events within prescribed timeframes could lead to regulatory actions, penalties, and delays in future product approvals[283](index=283&type=chunk) - Adverse events involving other anti-PD-1 or PD-L1 antibody products could negatively affect the company's product due to perceived comparability and potential regulatory scrutiny[284](index=284&type=chunk) [Risks Related to Intellectual Property](index=89&type=section&id=Risks%20Related%20to%20Intellectual%20Property) This section addresses risks concerning patent infringement, IP validity, and trade secrets - The company's commercial success depends on avoiding infringement of third-party patents[285](index=285&type=chunk) - Claims of infringement could lead to substantial expenses, monetary damages, or force delays/cessation of development/commercialization[287](index=287&type=chunk)[291](index=291&type=chunk)[293](index=293&type=chunk) - The validity and enforceability of patents are uncertain[298](index=298&type=chunk) - Patents may be challenged, invalidated, or circumvented, limiting the ability to prevent competitors from marketing similar products[409](index=409&type=chunk) - Reliance on trade secrets for non-patentable technology carries risks of discovery by competitors, misappropriation, or unauthorized disclosure, which could impair competitive position[299](index=299&type=chunk)[398](index=398&type=chunk)[422](index=422&type=chunk) - Failure to comply with obligations in intellectual property license agreements could result in loss of critical license rights[307](index=307&type=chunk) - The company may not successfully obtain or maintain necessary intellectual property rights through acquisitions and in-licenses, potentially forcing abandonment of development programs[309](index=309&type=chunk)[311](index=311&type=chunk) - The European Unitary Patent system and Unified Patent Court (UPC) introduce new complexities and risks, including central revocation of European patents and pan-European injunctions[412](index=412&type=chunk)[414](index=414&type=chunk) [Risks Related to the Discovery and Development of Our Product Candidates](index=99&type=section&id=Risks%20Related%20to%20the%20Discovery%20and%20Development%20of%20Our%20Product%20Candidates) This section details risks in discovery, clinical development, and regulatory approval - Future success is highly dependent on the development, clinical success, regulatory approval, and commercial success of product candidates (casdozokitug, CHS-114, toripalimab in non-NPC indications), none of which have initiated **Phase 3** trials[312](index=312&type=chunk)[313](index=313&type=chunk)[314](index=314&type=chunk) - The regulatory approval processes are lengthy, time-consuming, and unpredictable[316](index=316&type=chunk) - Failure to obtain approval in targeted jurisdictions would prevent marketing to larger patient populations and reduce commercial opportunities[317](index=317&type=chunk)[319](index=319&type=chunk)[332](index=332&type=chunk) - Clinical drug development is expensive and lengthy, with inherent uncertainty and a high failure rate[321](index=321&type=chunk) - Delays or failures in clinical studies can occur at any stage due to various factors, including patient enrollment difficulties, adverse events, or regulatory changes[322](index=322&type=chunk)[325](index=325&type=chunk)[326](index=326&type=chunk)[327](index=327&type=chunk)[328](index=328&type=chunk) - The company may not be successful in identifying, developing, or commercializing additional product candidates, potentially leading to abandonment of programs or cessation of operations[333](index=333&type=chunk)[334](index=334&type=chunk) [Risks Related to Our Compliance with Applicable Laws](index=106&type=section&id=Risks%20Related%20to%20Our%20Compliance%20with%20Applicable%20Laws) This section outlines risks with healthcare reform, fraud and abuse laws, and government pricing - Healthcare reform measures, including the Inflation Reduction Act of 2022 (IRA) and the One Big Beautiful Bill Act (OBBBA), may increase costs, affect pricing, and materially impact the business by requiring price negotiations with Medicare, imposing rebates, and reducing Medicaid funding[215](index=215&type=chunk)[335](index=335&type=chunk)[338](index=338&type=chunk)[339](index=339&type=chunk) - The company is subject to federal and state healthcare fraud and abuse laws (e.g., Anti-Kickback Statute, False Claims Act, HIPAA, Sunshine Act)[344](index=344&type=chunk) - Non-compliance could lead to substantial penalties, fines, exclusion from government programs, and operational restructuring[349](index=349&type=chunk)[347](index=347&type=chunk) - Failure to comply with reporting and payment obligations under government pricing programs (Medicaid Drug Rebate Program, 340B, VA FSS) could result in additional reimbursement requirements, penalties, and fines[351](index=351&type=chunk)[352](index=352&type=chunk)[353](index=353&type=chunk)[357](index=357&type=chunk) [Risks Related to Ownership of Our Common Stock](index=116&type=section&id=Risks%20Related%20to%20Ownership%20of%20Our%20Common%20Stock) This section addresses risks related to stock price volatility, internal control, and delisting - The market price of the common stock is highly volatile, influenced by clinical trial results, funding, regulatory decisions, competition, financial projections, and macroeconomic conditions[358](index=358&type=chunk)[359](index=359&type=chunk) - A material weakness in internal control over financial reporting (related to inventory account reconciliations) has been identified, which could lead to misstatements or failure to meet reporting obligations, harming investor confidence and stock price[360](index=360&type=chunk)[361](index=361&type=chunk)[365](index=365&type=chunk)[431](index=431&type=chunk) - The company received a Nasdaq notice for failing to meet the minimum **$1.00** bid price requirement[367](index=367&type=chunk) - Failure to regain compliance by **December 29, 2025**, could lead to delisting, adversely affecting financing, trading, and stock value[368](index=368&type=chunk)[371](index=371&type=chunk)[372](index=372&type=chunk) - Indebtedness could adversely affect financial condition, ability to raise capital, and operations, potentially diverting cash flow for debt payments and limiting flexibility[374](index=374&type=chunk)[376](index=376&type=chunk)[377](index=377&type=chunk) - Future sales and issuances of common stock (e.g., through ATM Offering, equity incentive plans) could dilute existing stockholders' ownership and cause the stock price to fall[378](index=378&type=chunk)[379](index=379&type=chunk)[380](index=380&type=chunk)[383](index=383&type=chunk) - Adverse developments in the financial services industry could impact the company's access to cash and liquidity, affecting operations and financial condition[385](index=385&type=chunk) - Provisions in the company's corporate documents and Delaware law could make it more difficult or costly for a third party to acquire the company[387](index=387&type=chunk)[389](index=389&type=chunk)[390](index=390&type=chunk) [General Risk Factors](index=126&type=section&id=General%20Risk%20Factors) This section covers broad operational, international, technological, and macroeconomic risks - Dependence on a limited number of wholesalers for a significant portion of revenue means the loss of any major wholesaler or reduction in their purchases could harm the business[392](index=392&type=chunk)[394](index=394&type=chunk) - International business operations expose the company to various risks, including conflicting laws, regulatory hurdles, intellectual property enforcement challenges, financial risks (e.g., currency fluctuations), and geopolitical instability[395](index=395&type=chunk) - Investor expectations regarding environmental, social, and governance (ESG) factors may impose additional costs, expose the company to new risks, and affect investment strategies or ratings[396](index=396&type=chunk)[397](index=397&type=chunk) - Reliance on third parties necessitates sharing trade secrets, increasing the risk of discovery by competitors or misappropriation[398](index=398&type=chunk) - The issuance of 'submarine' patents to competitors could significantly alter launch timing, reduce market size, or block the company from the market[399](index=399&type=chunk)[400](index=400&type=chunk)[401](index=401&type=chunk) - Failure to identify or correctly interpret relevant patents could adversely affect the ability to develop and market products[402](index=402&type=chunk)[403](index=403&type=chunk)[404](index=404&type=chunk)[405](index=405&type=chunk) - Operating as a public company incurs significant costs and requires substantial management time for compliance, including **Section 404 of Sarbanes-Oxley**, with potential sanctions for non-compliance[428](index=428&type=chunk)[430](index=430&type=chunk)[431](index=431&type=chunk)[432](index=432&type=chunk) - Information technology systems are vulnerable to security breaches and cyberattacks, exacerbated by geopolitical tensions, which could disrupt operations, lead to data loss, and incur significant liabilities[434](index=434&type=chunk)[435](index=435&type=chunk)[436](index=436&type=chunk)[437](index=437&type=chunk)[438](index=438&type=chunk)[439](index=439&type=chunk) - Compliance with evolving global privacy, data protection, and information security laws (e.g., GDPR, CCPA) is rigorous and costly, with non-compliance potentially leading to fines, litigation, and reputational harm[440](index=440&type=chunk)[441](index=441&type=chunk)[442](index=442&type=chunk)[444](index=444&type=chunk)[445](index=445&type=chunk)[447](index=447&type=chunk) - Continued inflation could adversely impact product demand, labor/material costs, margins, and interest expenses on variable rate indebtedness[448](index=448&type=chunk)[450](index=450&type=chunk) - Failure to comply with environmental, health, and safety laws could result in fines, penalties, or costly clean-up liabilities[451](index=451&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds, and Issuer Purchases of Equity Securities](index=92&type=section&id=ITEM%202%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) This section reports no unregistered equity sales or issuer purchases during Q2 2025 - No unregistered sales of equity securities or issuer purchases of equity securities occurred during **Q2 2025**[452](index=452&type=chunk) - **16,519 shares** were surrendered to satisfy minimum tax withholding obligations related to stock-based awards[452](index=452&type=chunk) [Item 3. Defaults Upon Senior Securities](index=92&type=section&id=ITEM%203%20Defaults%20Upon%20Senior%20Securities) This item is marked 'Not applicable,' indicating no defaults on senior securities - Not applicable, indicating no defaults upon senior securities[453](index=453&type=chunk) [Item 4. Mine Safety Disclosures](index=92&type=section&id=ITEM%204%20Mine%20Safety%20Disclosures) This item is marked as 'Not applicable,' indicating no mine safety disclosures are required - Not applicable, indicating no mine safety disclosures[453](index=453&type=chunk) [Item 5. Other Information](index=92&type=section&id=ITEM%205%20Other%20Information) This section confirms no director or officer adopted or terminated Rule 10b5-1 arrangements - No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended **June 30, 2025**[453](index=453&type=chunk) [Item 6. Exhibits](index=93&type=section&id=ITEM%206.%20Exhibits) This section provides an index of exhibits filed with Form 10-Q - The exhibit index lists various documents, including the Asset Purchase Agreement for UDENYCA, amended corporate certificates and bylaws, indenture for convertible notes, equity incentive plans, and certifications[455](index=455&type=chunk)

[Q2 2025 Business and Financial Highlights](index=1&type=section&id=Coherus%20Oncology%20Reports%20Second%20Quarter%202025%20Financial%20Results%20and%20Provides%20Business%20Update) [Executive Summary](index=1&type=section&id=Executive%20Summary) Coherus Oncology achieved strong Q2 2025 commercial execution with a 36% LOQTORZI revenue increase and a $238 million cash position, securing a runway through 2026 LOQTORZI Net Revenue and Cash Position | Metric | Value | Change (QoQ) | | :--- | :--- | :--- | | LOQTORZI Net Revenue | $10.0 million | +36% | | Cash, Cash Equivalents & Marketable Securities | $238 million | N/A | - The company has a cash runway through 2026, which is beyond the expected key data readouts for its pipeline assets[2](index=2&type=chunk) - Data readouts for the oncology pipeline candidates CHS-114 (a cytolytic CCR8 antibody) and casdozokitug are on track for the first half of 2026[1](index=1&type=chunk)[2](index=2&type=chunk) - The company's strategy focuses on maximizing LOQTORZI's potential, executing on clinical development to de-risk the pipeline, and creating ex-U.S. licensing opportunities[2](index=2&type=chunk) [Business Updates](index=1&type=section&id=RECENT%20BUSINESS%20HIGHLIGHTS) This section details LOQTORZI's commercial growth, oncology pipeline advancements, and the strategic UDENYCA divestiture to strengthen financial position [LOQTORZI® Commercial Updates](index=1&type=section&id=LOQTORZI%C2%AE%20(toripalimab-tpzi)%20COMMERCIAL%20UPDATES) LOQTORZI net revenue increased 36% to $10.0 million in Q2 2025, driven by demand and NCCN preferred status for NPC LOQTORZI Net Revenue Performance | Period | LOQTORZI Net Revenue | | :--- | :--- | | Q2 2025 | $10.0 million | | Q1 2025 | $7.3 million | | Q2 2024 | $3.8 million | - LOQTORZI is the only FDA-approved treatment in the U.S. for all patient subsets and lines of therapy for recurrent, locally advanced or metastatic nasopharyngeal carcinoma (NPC)[3](index=3&type=chunk) - The National Comprehensive Cancer Network (NCCN) guidelines were recently revised, granting LOQTORZI preferred status for its NPC indication, which has led to strong demand growth among Head & Neck cancer specialists[3](index=3&type=chunk) [Oncology Pipeline Advancement](index=2&type=section&id=ADVANCEMENT%20OF%20INNOVATIVE%2C%20NEXT-GENERATION%20ONCOLOGY%20PIPELINE) Coherus advances its oncology pipeline, combining LOQTORZI with CHS-114 and casdozokitug for solid tumors, with key data expected in 1H 2026 [LOQTORZI (toripalimab-tpzi)](index=2&type=section&id=LOQTORZI) The strategy focuses on maximizing LOQTORZI's value through combination therapies with internal candidates and external partnerships for label expansions - Coherus plans to maximize the value of LOQTORZI by combining it with internal pipeline candidates (CHS-114, casdozokitug) and pursuing capital-efficient external partnerships for label expansions[4](index=4&type=chunk) [CHS-114 (CCR8 Antibody)](index=2&type=section&id=CHS-114) CHS-114, a selective cytolytic CCR8 antibody, is in Phase 1b combination studies with toripalimab, with initial data expected in 1H 2026 - CHS-114 is a selective cytolytic CCR8 antibody designed to deplete tumor regulatory T cells (Tregs)[4](index=4&type=chunk) - Phase 1b combination studies with toripalimab are underway in head and neck, gastric, and esophageal cancers, with initial data readouts expected in 1H 2026[11](index=11&type=chunk) [Casdozokitug (IL-27 Antagonist)](index=2&type=section&id=Casdozokitug) Casdozokitug, a first-in-class IL-27 antagonist, is undergoing a Phase 2 randomized trial in 1L HCC, with initial data expected in 1H 2026 - Casdozokitug is a first-in-class IL-27 antagonist with demonstrated activity in NSCLC, ccRCC, and HCC[5](index=5&type=chunk) - A Phase 2 randomized trial in 1L hepatocellular carcinoma (HCC) is ongoing, with the first data readout expected in 1H 2026[5](index=5&type=chunk) [UDENYCA Divestiture and Debt Repayment](index=2&type=section&id=UDENYCA%20DIVESTITURE%20COMPLETED%20AND%20CERTAIN%20FINANCIAL%20OBLIGATIONS%20PAID%20OFF) Coherus completed the UDENYCA divestiture in Q2 2025 for $483.4 million, using proceeds to repay $230 million in convertible notes and buy out royalty rights UDENYCA Divestiture Summary | Transaction | Details | | :--- | :--- | | UDENYCA Divestiture | Completed April 11, 2025 | | Cash Received | $483.4 million (incl. $118.4M for inventory) | | Potential Milestones | Up to $75 million | - The company used proceeds to repay substantially all of the **$230 million** principal of its 2026 Convertible Notes[7](index=7&type=chunk) - Coherus also used proceeds to buy out royalty rights on UDENYCA net revenues for a payment of **$47.7 million**[7](index=7&type=chunk) [Second Quarter 2025 Financial Results](index=2&type=section&id=SECOND%20QUARTER%202025%20FINANCIAL%20RESULTS) This section details Q2 2025 financial performance, covering continuing and discontinued operations, and the company's strengthened cash and financial position [Overview of Financial Performance](index=2&type=section&id=Overview%20of%20Financial%20Performance) Q2 2025 net revenue from continuing operations was flat at $10.3 million, with R&D increasing to $26.3 million and SG&A decreasing to $26.0 million, narrowing net loss to $(44.9) million Key Financial Metrics (Continuing Operations) | Metric (Continuing Operations) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Revenue | $10.3 million | $10.3 million | | Cost of Goods Sold | $3.4 million | $1.8 million | | R&D Expenses | $26.3 million | $20.6 million | | SG&A Expenses | $26.0 million | $27.5 million | | Net Loss | $(44.9) million | $(54.9) million | | Diluted EPS | $(0.39) | $(0.48) | - The increase in R&D expenses was primarily due to development costs for casdozokitug and CHS-114[10](index=10&type=chunk) - The decrease in SG&A expenses was driven by lower headcount and reduced operating costs following recent divestitures[12](index=12&type=chunk) [Discontinued Operations](index=3&type=section&id=Discontinued%20Operations) Net income from discontinued operations surged to $342.6 million in Q2 2025, primarily due to a $339.1 million net gain from the UDENYCA divestiture Discontinued Operations Financial Summary | Metric (Discontinued Operations) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Income, net of tax | $342.6 million | $41.9 million | | Diluted EPS | $2.95 | $0.37 | - The increase in income from discontinued operations was primarily due to the **$339.1 million** net gain on the UDENYCA divestiture[17](index=17&type=chunk) [Cash and Financial Position](index=3&type=section&id=Cash%20and%20Financial%20Position) Coherus ended Q2 2025 with a strong cash position of $237.6 million, a significant increase from year-end 2024, primarily due to the UDENYCA divestiture Cash and Marketable Securities | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash, cash equivalents and marketable securities | $237.6 million | $126.0 million | [Financial Statements](index=6&type=section&id=Financial%20Statements) This section provides the condensed consolidated statements of operations, balance sheets, cash flows, and non-GAAP financial measures reconciliation [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Coherus reported a Q2 2025 net loss from continuing operations of $44.9 million, but a total net income of $297.8 million, or $2.57 per share, due to discontinued operations Condensed Consolidated Statements of Operations (Three Months) | (in thousands, except per share data) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net revenue | $10,254 | $10,296 | | Total costs and expenses | $55,740 | $49,922 | | Loss from operations | $(45,486) | $(39,626) | | Net loss from continuing operations | $(44,862) | $(54,851) | | Net income from discontinued operations, net of tax | $342,629 | $41,930 | | **Net income (loss)** | **$297,767** | **$(12,921)** | | Net loss per share from continuing operations | $(0.39) | $(0.48) | | **Net income (loss) per share** | **$2.57** | **$(0.11)** | [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were $439.5 million, with stockholders' equity turning positive to $119.8 million from a $132.0 million deficit, driven by divestitures and debt reduction Condensed Consolidated Balance Sheets | (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $216,893 | $125,987 | | Total assets | $439,464 | $448,533 | | Convertible notes | $121 | $228,229 | | Total liabilities | $319,637 | $580,523 | | Total stockholders' equity (deficit) | $119,827 | $(131,990) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, operating activities used $72.5 million, investing activities provided $445.2 million, and financing activities used $281.8 million, resulting in a $90.9 million net cash increase Condensed Consolidated Statements of Cash Flows (Six Months) | (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(72,458) | $12,968 | | Net cash provided by investing activities | $445,152 | $230,419 | | Net cash used in financing activities | $(281,788) | $(187,038) | | **Net increase in cash** | **$90,906** | **$56,349** | | Cash at end of period | $217,156 | $159,692 | [Non-GAAP Financial Measures Reconciliation](index=9&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliation) Coherus reported a Q2 2025 non-GAAP net loss from continuing operations of $39.0 million, or $(0.34) per share, adjusted for stock-based compensation and intangible asset amortization Non-GAAP Net Loss from Continuing Operations Reconciliation | (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | GAAP net loss from continuing operations | $(44,862) | $(54,851) | | Stock-based compensation expense | $5,166 | $6,859 | | Loss on debt extinguishment | — | $12,630 | | Amortization of intangible assets | $667 | $679 | | **Non-GAAP net loss from continuing operations** | **$(39,029)** | **$(34,683)** | [Corporate Information and Forward-Looking Statements](index=3&type=section&id=Corporate%20Information%20and%20Forward-Looking%20Statements) This section includes conference call details, an overview of Coherus Oncology, and standard forward-looking statements regarding future performance and risks [Conference Call Information](index=3&type=section&id=Conference%20Call%20Information) A conference call to discuss Q2 2025 results will be held on Thursday, August 7, 2025, at 5:00 p.m. ET, with access details provided [About Coherus Oncology](index=4&type=section&id=About%20Coherus%20Oncology) Coherus Oncology is a commercial-stage company focused on its PD-1 inhibitor LOQTORZI and an immuno-oncology pipeline, aiming to grow sales and advance combination therapies [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section includes standard forward-looking statements, cautioning that actual results may differ due to inherent risks in drug development, regulation, competition, and financing

Core Insights - Coherus Oncology reported a net revenue of $10.0 million for LOQTORZI, marking a 36% increase from Q1 2025, driven by higher patient demand and inventory restocking [1][6][11] - The company has a cash position of $238 million as of Q2 2025, providing a runway through 2026 for ongoing clinical programs [1][22] - Upcoming data readouts for CHS-114 and casdozokitug are expected in the first half of 2026, indicating progress in the oncology pipeline [1][2][7] Financial Performance - LOQTORZI net revenue increased from $7.3 million in Q1 2025 to $10.0 million in Q2 2025, compared to $3.8 million in Q2 2024 [6][11] - Total net revenue from continuing operations was approximately $10.3 million for Q2 2025, consistent with Q2 2024 [11] - The net loss from continuing operations for Q2 2025 was $44.9 million, a reduction from a net loss of $54.9 million in Q2 2024 [16] Pipeline Development - CHS-114, a cytolytic CCR8 antibody, is in Phase 1b studies, with initial data readouts expected in 1H 2026 [2][7] - Casdozokitug, an IL-27 antagonist, is being evaluated in multiple studies, with a focus on solid tumors [5][25] - The combination of LOQTORZI with internal pipeline candidates is aimed at expanding treatment indications [4][24] Recent Business Highlights - The divestiture of UDENYCA was completed in April 2025, generating $483.4 million in cash, which has been used to pay off significant financial obligations [9][10] - The company is focusing on maximizing LOQTORZI's potential in nasopharyngeal carcinoma, supported by a recent revision in NCCN guidelines granting it preferred status [6][24] Cash Position and Financial Obligations - As of June 30, 2025, cash, cash equivalents, and marketable securities totaled $237.6 million, up from $126.0 million at the end of 2024 [22][33] - The company has settled a majority of UDENYCA-related obligations, which are expected to be resolved in a front-loaded manner over the remainder of 2025 and into 2026 [22]

Financial Results Announcement - Coherus Oncology will release its second quarter 2025 financial results after market close on August 7, 2025 [1] - A conference call and webcast will be hosted by Coherus' management team starting at 5:00 p.m. EDT on the same day to discuss the financial results and provide a business update [1][3] Webcast and Access Information - A replay of the webcast will be available on the Coherus investor website following the live conference call [2] - The press release with the financial results and related materials will be accessible on the investor website before the conference call begins [3] Company Overview - Coherus Oncology is a fully integrated commercial-stage innovative oncology company with an approved PD-1 inhibitor, LOQTORZI, and a promising pipeline including two mid-stage clinical candidates targeting various cancers [6] - The company aims to grow sales of LOQTORZI in nasopharyngeal carcinoma and advance new indications in combination with pipeline candidates and partners [6] Pipeline and Research Focus - Coherus' pipeline includes multiple antibody immunotherapy candidates designed to enhance immune responses against tumors [7] - CHS-114, a selective anti-CCR8 antibody, is in Phase 1b studies for advanced solid tumors, while Casdozokitug, an IL-27 antagonistic antibody, is being evaluated in multiple studies for various cancers [7]

CHS-114 Overview - CHS-114 is a highly selective anti-CCR8 mAb with the potential to augment I-O therapy by depleting Treg-mediated tumor immune suppression[16] - CHS-114 specifically binds and preferentially depletes CCR8+ tumor Tregs, with no off-target binding[17,23] - Preclinical data shows that anti-CCR8 with anti-PD-1 treatment demonstrates antitumor activity and a significant increase in tumoral CD8+ T cells[27,29] - *In vitro* data shows CHS-114 demonstrates dose-dependent Treg depletion and activation of NK and myeloid cells[37] Clinical Trial Design and Results - The Phase 1/1b study is an open-label single-agent and combination dose trial evaluating CHS-114 in patients with advanced solid tumors and HNSCC, with safety and tolerability as the primary endpoint[50,63] - In the monotherapy dose escalation (Stage 1a), 20 patients with advanced solid tumors were enrolled and evaluated seven dose levels (5 mg – 1200 mg) of CHS-114[54] - In HNSCC patients, treatment-emergent adverse events (TEAE) were observed in 85.7% of patients receiving CHS-114 monotherapy (n=14) and 100% of patients receiving CHS-114 + Toripalimab (n=7)[68] - One heavily pretreated PD-1 refractory patient with HNSCC treated with CHS-114 (DL6) + Toripalimab achieved a confirmed partial response with a 40% reduction in target lesions[73,88] Biomarker Analysis and Conclusions - CHS-114 administration leads to a substantial increase in CD8+ T cells in the TME, providing a strong rationale for combining with other drugs such as T cell engagers and bispecifics[102] - In on-treatment tumor biopsies, CHS-114 depleted CCR8+ Tregs and increased CD8+ T cells in the TME, indicating favorable TME remodeling and establishing proof of mechanism[102]

Coherus BioSciences (CHRS) Conference Call Summary Company Overview - **Company**: Coherus BioSciences - **Event**: Jefferies Global Healthcare Conference - **Date**: June 04, 2025 Key Industry Insights - **Focus Areas**: Coherus Oncology is concentrating on three main areas: - Lactorsi (proprietary PD-1 asset) for nasopharyngeal cancer - CHS-114 (anti-CCR8 cytolytic antibody) - Casdozo ketog (IL-27 antagonist) [4][6][40] Core Product Highlights - **Lactorsi**: - Launched in 2024, it is the only preferred treatment for both first-line and follow-on lines in nasopharyngeal cancer - Expected revenue of $40 to $50 million in 2025 [12][40] - Targets a market of approximately $150 to $200 million annually [11] - Demonstrated a 15% increase in overall demand from the previous quarter [12] - **CHS-114**: - Targets T regulatory cells, aiming to selectively deplete them in tumors to enhance immune response - High expression of CCR8 in various solid tumors, including head and neck, gastric, and colorectal cancers [18][23] - Anticipated data readouts in the first half of 2026 [6][8] - **Casdozo ketog**: - First-in-class IL-27 antagonist showing promise in liver cancer with a 38% overall response rate and a 17% complete response rate [33][36] - Expected to enter a global study comparing it with standard care [35] Financial Overview - **Debt Reduction**: Successfully reduced debt to approximately $38.7 million annually after divesting $800 million worth of assets [7][42] - **Cash Position**: Ended Q1 2025 with $82 million in cash, bolstered by a $250 million increase post-divestiture [42][44] - **Cost Management**: Plans to reduce workforce from 225 to about 50 employees, yielding $25 million in savings [42] Strategic Partnerships and Market Opportunities - **Partnerships**: Actively seeking partners for ex-US licensing of pipeline assets [40][41] - **Market Potential**: Combined market opportunity for pipeline assets exceeds $15 billion [6][40] Additional Insights - **Mechanistic Differentiation**: Lactorsi's unique binding mechanism allows for internalization of the PD-1 receptor, enhancing T cell signaling, particularly in low PD-L1 states [9][10][43] - **Clinical Development**: Robust clinical programs with expected results in 2026, focusing on large indications with multibillion-dollar market potential [43][44] - **Regulatory Engagement**: Positive alignment with the FDA regarding the development approach for CHS-114 and Casdozo ketog [28][41] This summary encapsulates the critical points discussed during the conference call, highlighting the strategic direction, product pipeline, financial health, and market opportunities for Coherus BioSciences.

Core Viewpoint - Coherus Oncology has rebranded itself to emphasize its commitment to innovative immuno-oncology therapies, focusing on combination therapies to enhance cancer treatment outcomes [1][2]. Company Overview - Coherus Oncology is a commercial-stage innovative oncology company with a focus on proprietary immuno-oncology medicines [1][10]. - The company has an approved next-generation PD-1 inhibitor, LOQTORZI, which is the only FDA-approved treatment for recurrent or metastatic nasopharyngeal carcinoma in combination with chemotherapy [5][10]. Pipeline and Development - Coherus is developing a portfolio of novel combination therapies aimed at overcoming immune resistance to existing treatments [4]. - LOQTORZI serves as the foundation of the company's immuno-oncology franchise, with ongoing development for additional tumor types [5][10]. - CHS-114, a selective cytolytic CCR8 antibody, is in Phase 1b studies in combination with toripalimab for advanced solid tumors [6]. - Casdozokitug, an IL-27 antagonist, is being evaluated in a randomized Phase 2 study for advanced metastatic hepatocellular carcinoma [7]. Scientific Expertise - The company is supported by a world-class team with deep expertise in oncology drug development, including members from prestigious institutions and companies [8]. - The Scientific Advisory Board includes experts in Treg immunology and cytokine biology, providing valuable insights for navigating the oncology landscape [8].

Coherus BioSciences (CHRS) FY Conference Summary Company Overview - Coherus BioSciences has transitioned into an innovative oncology company, divesting its biosimilar assets, including Lucentis, Yosemir, and UDENYCA, generating approximately $800 million in total from these divestitures [3][4] - The company has paid off $480 million in long-term debt and added $250 million to its balance sheet [3] Key Developments Loktorzi - Loktorzi is a central asset in Coherus' strategy, with ongoing pivotal trials for additional indications [4][5] - The launch for nasopharyngeal carcinoma (NPC) showed good growth in Q4, but Q1 was flat due to supply interruptions and sales team distractions [10][11] - The focus is on increasing the breadth of physician prescriptions, depth of market penetration, and ensuring patient duration on the product [12][13] Partnerships and Clinical Studies - Coherus announced a partnership for combination studies with STC 15 from Storm Therapeutics, targeting RNA methyltransferase activity, which has shown promise in solid tumors [16][17] - The goal is to drive label expansion for Torapalumab, a next-generation PD-1 inhibitor, through these partnerships [20][21] CHS 1 114 (Treg Depleter) - CHS 1 114 targets CCR8 to selectively deplete tumor-resident Tregs, showing promising early clinical data with significant Treg depletion and CD8 T cell infiltration [23][25][26] - The combination with Torapalumab in late-line head and neck cancer patients has shown early signs of activity, with ongoing studies to evaluate its efficacy further [27][28] Casdozoketug - Casdozoketug is an IL-27 antagonist showing promising results in liver cancer, with a 17% complete response rate in early studies, which is significantly higher than reported rates in phase three studies [41][42] - The company is planning to progress with studies in both liver and lung cancers, with data expected next year [44][46] Financial and Strategic Outlook - Coherus is focused on execution and leveraging its strong track record in development, regulatory affairs, and commercial success [48][49] - The company anticipates promising results from ongoing clinical trials and partnerships, positioning itself for growth in the oncology market [8][49] Additional Insights - The company is actively exploring other tumor types for CHS 1 114, indicating a broadening of its clinical focus [29] - The strategic emphasis on enhancing the commercial story and execution capabilities is expected to drive future success [48][49]

Core Insights - Coherus BioSciences has initiated a Phase 1b/2 clinical study to evaluate STC-15, a METTL3 inhibitor, in combination with LOQTORZI, a next-generation PD-1 inhibitor, targeting various cancers including non-small cell lung cancer (NSCLC) and melanoma [1][2] Company Overview - Coherus is a commercial-stage oncology company with an approved PD-1 inhibitor, LOQTORZI, and a pipeline that includes mid-stage candidates for liver, lung, and head & neck cancers [3] - The company aims to expand LOQTORZI's indications beyond nasopharyngeal carcinoma through strategic collaborations and cost-efficient drug supply agreements [2][3] Clinical Study Details - The Phase 1b/2 study will assess the safety and efficacy of the STC-15 and LOQTORZI combination, with up to 188 patients enrolled in the United States [2] - STORM Therapeutics is the sponsor of the trial, while Coherus will supply LOQTORZI, retaining commercial rights for both compounds [2] Immuno-Oncology Pipeline - Coherus' pipeline includes multiple antibody immunotherapy candidates designed to enhance immune responses against tumors [4] - Notable candidates include Casdozokitug, an IL-27 antagonistic antibody, and CHS-114, a selective anti-CCR8 antibody, both in various stages of clinical trials [4]

Financial Data and Key Metrics Changes - The company has transitioned from a biosimilars focus to an innovative immuno-oncology (IO) company, indicating a significant strategic shift [1] - The launch of Lactorsi as a preferred therapy in NCCN guidelines is a notable development, with the team reportedly hitting their stride in Q2 after overcoming earlier disruptions [33] Business Line Data and Key Metrics Changes - The company presented encouraging data for its CCRA antibody, CHS 114, showing a partial response in a patient with advanced refractory disease, highlighting the potential of targeted therapies [2][5] - The combination of CHS 114 with toripalumab has shown marked depletion of T regulatory cells, leading to significant immune cell infiltration, which is a positive indicator for its efficacy [10][11] Market Data and Key Metrics Changes - The company is aware of the looming loss of exclusivity (LOE) for Keytruda in 2028 and is strategically positioning Lactorsi to differentiate itself in the market [15][16] - The competitive landscape is evolving, with the company focusing on novel mechanisms and combinations that could provide advantages over existing PD-1 therapies [17][29] Company Strategy and Development Direction - The company aims to develop both CHS 114 and casdosakitug in combination with toripalumab, seeking to maximize the potential of its pipeline [17][24] - The strategy includes forming partnerships that focus on novel mechanisms of action while maintaining a capital-efficient approach [24] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the ongoing clinical data flow and the potential for upcoming collaborations, particularly in liver cancer, head and neck, and lung cancer [22][24] - The company is excited about the differentiated mechanism of action of Lactorsi, which has shown activity in PD-L1 low patients, setting it apart from competitors [28][30] Other Important Information - The company has divested from its biosimilar business to focus on innovative oncology, which is seen as a space with greater potential for value creation [40][41] - The safety profile of castosakitug has been well tolerated, with promising early results in lung and liver cancers, indicating a strong potential for future studies [36][38] Q&A Session Summary Question: What was encouraging about the data for the CCRA antibody? - The data showed a partial response in a patient with advanced refractory disease, which is significant given the patient's history of treatment failures [2] Question: How does the company view the competition with Keytruda? - The company is aware of the LOE for Keytruda and believes that their differentiated therapies will maintain a competitive edge despite the upcoming biosimilars [15][16] Question: What is the strategy for partnerships moving forward? - The company is focusing on collaborations that will yield interesting clinical data and is prioritizing partnerships that involve novel mechanisms of action [24][22]