Core Insights - Fractyl Health, Inc. is focused on innovative metabolic therapeutics aimed at addressing the root causes of obesity and type 2 diabetes (T2D) [1][3] - The company will present new preclinical data from its Rejuva Smart GLP-1 pancreatic gene therapy platform at the American Diabetes Association's 85th Scientific Sessions [1][2] Company Overview - Fractyl Health is dedicated to transforming the treatment of metabolic diseases from chronic management to durable, disease-modifying therapies [3] - The company is based in Burlington, Massachusetts, and aims to tackle the increasing prevalence of obesity and T2D, which are significant contributors to morbidity and mortality in the 21st century [3] Rejuva Platform - The Rejuva platform is focused on developing next-generation adeno-associated virus (AAV)-based gene therapies specifically for obesity and T2D [4] - Currently in preclinical development, the Rejuva platform utilizes advanced delivery systems and proprietary screening methods to identify gene therapy candidates targeting the pancreas [4] - The goal of the Rejuva program is to provide novel therapies that address the underlying causes of metabolic diseases [4]

Core Insights - The collaboration between Fractyl Health and Bariendo aims to develop a scalable clinical pathway for the Revita procedure, which is intended for weight maintenance after discontinuation of GLP-1 drugs, pending FDA approval [1][5][6] - There is a growing demand for endoscopic alternatives to GLP-1 drugs, as many patients experience rapid weight regain after stopping these medications [5][6] - Revita is positioned as a potential first disease-modifying therapy targeting the root causes of obesity by resurfacing the duodenal lining [3][8] Company Overview - Fractyl Health focuses on innovative metabolic therapeutics that address the root causes of obesity and type 2 diabetes, aiming to transform treatment from chronic management to durable therapies [7] - Bariendo is a direct-to-consumer platform that offers advanced endoscopic weight loss procedures and aims to provide long-term solutions to obesity without ongoing medication [9] Clinical Development - Fractyl is preparing for three key data readouts from its pivotal study of Revita: open-label data from REVEAL-1 expected in June 2025, midpoint data from REMAIN-1 in Q3 2025, and primary endpoint data from REMAIN-1 in the second half of 2026 [2] - The collaboration will focus on pre-commercial preparation, including clinical workflow design, provider education, and health economic analysis [5] Market Context - The increasing use of GLP-1 drugs has highlighted the need for effective solutions to maintain weight loss after discontinuation, creating an urgent market opportunity for Revita [5][6] - Bariendo's holistic approach to obesity care aligns with the goals of Revita, emphasizing the importance of integrating metabolic endoscopic solutions into clinical practice [4][6]

Core Insights - Fractyl Health, Inc. announced promising preclinical data for its RJVA-001 gene therapy, which shows potential for durable metabolic improvements in type 2 diabetes (T2D) with low systemic GLP-1 exposure [1][2][3] - The therapy mimics natural hormone regulation, achieving significant metabolic benefits while minimizing side effects associated with current GLP-1 drugs [1][3][4] Group 1: RJVA-001 Efficacy and Mechanism - A single dose of RJVA-001 resulted in over 200 mg/dL reduction in fasting blood sugar and more than 2-fold increase in fasting insulin levels in db/db mice, demonstrating its efficacy in metabolic control [3][4] - RJVA-001 achieved glycemic control with circulating GLP-1 levels more than 5-fold lower than those seen with pharmacologic GLP-1 drugs, indicating a lower risk of side effects [3][4] - The therapy showed nutrient-responsive GLP-1 secretion, activating glucose-dependent expression in human beta cells, which reflects a more physiological response compared to constant drug stimulation [3][4] Group 2: Safety and Delivery Method - Endoscopic ultrasound-guided delivery of RJVA-001 in large animal models demonstrated targeted pancreatic expression with no observed toxicity, reinforcing its safety profile [4] - The procedure time for delivery was under 20 minutes, and biodistribution studies indicated minimal systemic distribution, with no adverse safety findings even at high doses [4] Group 3: Future Development and Regulatory Plans - Fractyl Health plans to submit the first Clinical Trial Application (CTA) module for RJVA-001 by June 2025, with preliminary human data expected in 2026 [1][6] - The company aims to transform the treatment of metabolic diseases by shifting from chronic management to durable disease-modifying therapies targeting root causes [5][6]

Financial Data and Key Metrics Changes - In Q1 2025, the company reported a net loss of $23.7 million, compared to a net loss of $3.3 million in Q1 2024, largely due to fluctuations in the non-cash change in fair value of notes and warrants and increased operating expenses [20] - Research and development expenses increased to $19.4 million from $14.4 million in the same period last year, reflecting advancements in the REMAIN one study and the Rejuva program [19] - Cash and cash equivalents as of March 31, 2025, were approximately $42.1 million, expected to fund operations into Q4 2025 [20] Business Line Data and Key Metrics Changes - The REMAIN one pivotal cohort has completed full enrollment, evaluating Revita for durable weight maintenance after GLP-1 discontinuation, significantly ahead of schedule [8] - The REVEAL one cohort showed promising initial results, with participants experiencing only a 1.2% average weight regain after one month, compared to the typical 3% after GLP-1 cessation [10] Market Data and Key Metrics Changes - The company is focused on addressing the efficacy and durability gaps in obesity care, as evidenced by real-world studies showing GLP-1s do not deliver the expected weight loss [6][7] - Market research indicates strong patient interest in alternatives to chronic pharmacotherapy for obesity management, highlighting the potential for Revita [12] Company Strategy and Development Direction - The company aims to redefine obesity treatment by offering patient-friendly solutions for durable improvements in weight and metabolic control, particularly through the Revita and Rejuva platforms [5][13] - The Rejuva platform is designed to deliver a first-in-class GLP-1 based therapy for obesity and metabolic disease, focusing on safety, efficacy, and commercial viability [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the upcoming year, anticipating significant milestones including data from the REVEAL one cohort and the first CTA module submission for Rejuva [24] - The company is closely monitoring regulatory developments but does not foresee any immediate impacts on its submission processes [41][42] Other Important Information - The company has established a hub and spoke network across the U.S. for the Revita program, enhancing its commercial model and patient access [11] - The Rejuva platform has achieved regulatory alignment with European authorities for its first-in-human study design, with plans to submit the first CTA module soon [16] Q&A Session Summary Question: Clarification on REMAIN one midpoint analysis - Management confirmed that over 45 patients have achieved the required 15% weight loss, and they are confident in the Q3 dataset [29][30] Question: Upcoming REVEAL one update - The three-month data will include the majority of previously reported patients, with additional data expected from new enrollees [34] Question: Concerns regarding FDA shakeup - Management indicated no current concerns affecting regulatory interactions, with ongoing dialogue with the FDA proceeding normally [41][42] Question: Enrollment progress in REMAIN one - Enrollment was approximately three months ahead of schedule due to higher than expected demand at individual sites [48] Question: Sham procedure details - The sham procedure involves an upper endoscopy and catheter introduction, with strict protocols to maintain blinding [51]

Financial Data and Key Metrics Changes - In Q1 2025, the company reported a net loss of $23.7 million, compared to a net loss of $3.3 million in Q1 2024, largely due to fluctuations in the non-cash change in fair value of notes and warrants and increased operating expenses [18] - Research and development expenses increased to $19.4 million from $14.4 million in the same period last year, reflecting advancements in the REMAIN one study and the Rejuva program [17] - Cash and cash equivalents as of March 31, 2025, were approximately $42.1 million, which is expected to fund operations into Q4 2025 [18] Business Line Data and Key Metrics Changes - The REMAIN one pivotal cohort has completed full enrollment, evaluating Revita for durable weight maintenance after GLP-1 discontinuation, significantly ahead of schedule [7] - The REVEAL one cohort showed promising initial results, with participants experiencing only a 1.2% average weight regain after GLP-1 cessation, compared to the typical 3% [9] Market Data and Key Metrics Changes - The company is addressing a significant unmet need in obesity care, as real-world evidence indicates that GLP-1 drugs do not deliver the expected weight loss seen in clinical trials [5] - There is a clear demand for non-drug options to enhance efficacy in weight maintenance after discontinuation of GLP-1 therapy, as patients express a strong interest in alternatives like Revita [11] Company Strategy and Development Direction - The company aims to redefine obesity treatment by offering patient-friendly solutions for durable improvements in weight and metabolic control, focusing on scalable outpatient solutions [4] - The Rejuva platform is designed to deliver a best-in-class GLP-1 based therapy for obesity and metabolic disease, emphasizing potency, durability, and convenience [12] Management's Comments on Operating Environment and Future Outlook - Management anticipates 2025 to be a year of acceleration, with multiple data readouts and regulatory filings expected [4] - The company is confident in its ability to deliver key milestones, including pivotal data from the REMAIN one study and the first CTA module submission for Rejuva [21] Other Important Information - The company has developed a large-scale cGMP manufacturing process for Rejuva, which could significantly lower costs compared to current systemic gene therapy products [15] - Management does not foresee any material impact from current tariff policies on its business operations [19] Q&A Session Summary Question: Regarding the midpoint analysis of REMAIN one - Management confirmed that over 45 patients have achieved the required 15% total body weight loss and anticipates the dataset in Q3 [27][28] Question: Upcoming REVEAL one update - The three-month data will include the majority of previously reported patients, with additional data expected from new participants [31][33] Question: Concerns about FDA shakeup - Management stated that there are no current concerns affecting regulatory interactions, and preparations for the CTA are on track [40][41] Question: Enrollment progress in REMAIN one - Enrollment was approximately three months ahead of schedule, driven by higher than expected demand at individual sites [47] Question: Sham procedure details - The sham procedure involves an upper endoscopy and randomization, ensuring rigorous controls to limit placebo effects [50][52]

[Business Updates and Clinical Pipeline Progress](index=1&type=section&id=Recent%20Highlights%20and%20Upcoming%20Milestones) Fractyl Health advanced its Revita® program for weight maintenance and Rejuva® gene therapy platform for T2D, with key clinical milestones approaching - The company focuses on addressing weight loss maintenance after patients discontinue GLP-1 therapy, a market opportunity estimated at **$175 billion** globally[3](index=3&type=chunk) - Key upcoming milestones include the REVEAL-1 3-month data update in June 2025, REMAIN-1 Midpoint Cohort data in Q3 2025, and the first CTA module submission for the Rejuva platform's RJVA-001 in June 2025[1](index=1&type=chunk) [Revita® Program Updates](index=1&type=section&id=Revita%C2%AE) The Revita® program is evaluating its efficacy through three distinct patient cohorts within the REMAIN-1 pivotal study - The REMAIN-1 pivotal study evaluates Revita through three distinct patient cohorts: REVEAL-1, REMAIN-1 Midpoint, and REMAIN-1 Pivotal[4](index=4&type=chunk) - Early data from the first 7 participants in the open-label REVEAL-1 Cohort showed an average weight regain of only **1.2%** one month after discontinuing GLP-1 therapy, compared to a typical regain of approximately **3%**, with a 3-month data update expected in June 2025[11](index=11&type=chunk) - The randomized REMAIN-1 Midpoint Cohort (45 participants) has completed enrollment, with the first 3-month randomized data on post-GLP-1 weight maintenance expected in Q3 2025[7](index=7&type=chunk) - Enrollment for the REMAIN-1 Pivotal Cohort (315 participants) was completed ahead of schedule, with 6-month primary endpoint data anticipated in the second half of 2026[8](index=8&type=chunk) [Rejuva® Gene Therapy Platform](index=2&type=section&id=Rejuva%C2%AE) The Rejuva® platform is progressing towards first-in-human studies with a regulatory submission planned for its lead candidate - The Rejuva® platform is advancing toward first-in-human studies, with plans to submit the first Clinical Trial Application (CTA) module for its lead candidate, RJVA-001, in June 2025[12](index=12&type=chunk) - RJVA-001 is being developed as a gene therapy for patients with inadequately controlled T2D, with preliminary data expected in 2026 pending regulatory authorization and first patient dosing[12](index=12&type=chunk)[20](index=20&type=chunk) [First Quarter 2025 Financial Results](index=3&type=section&id=First%20Quarter%202025%20Financial%20Results) For Q1 2025, Fractyl Health reported a net loss primarily driven by non-cash fair value adjustments and increased operating expenses [Key Financial Metrics](index=3&type=section&id=Key%20Financial%20Metrics) Key financial metrics for Q1 2025 reflect increased R&D expenses and a higher net loss compared to Q1 2024 | Financial Metric | Q1 2025 | Q1 2024 | Change | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | **R&D Expenses** | $19.4M | $14.4M | +$5.0M | Advancement of REMAIN-1, Rejuva program, and related personnel costs | | **SG&A Expenses** | $5.3M | $7.1M | -$1.8M | Lower stock-based compensation, offset by increased public company costs | | **Net Loss** | $23.7M | $3.3M | +$20.4M | Fluctuation in non-cash fair value of notes/warrants and increased operating expenses | - As of March 31, 2025, the company held **$42.1 million** in cash and cash equivalents, which is expected to fund operations into the fourth quarter of 2025[16](index=16&type=chunk) [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements provide a detailed overview of the company's balance sheet and operations for the reported periods Selected Consolidated Balance Sheet Data (in thousands) | | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $42,108 | $67,464 | | **Total assets** | $83,040 | $108,077 | | **Total liabilities** | $76,665 | $79,653 | | **Total stockholders' equity** | $6,375 | $28,424 | Consolidated Statements of Operations (in thousands) | | Three Months Ended March 31, | | | :--- | :--- | :--- | | | **2025** | **2024** | | **Revenue** | $— | $33 | | **Research and development** | $19,435 | $14,424 | | **Selling, general and administrative** | $5,324 | $7,132 | | **Loss from operations** | $(24,759) | $(21,542) | | **Net loss and comprehensive loss** | $(23,735) | $(3,322) |

Core Insights - Fractyl Health is advancing its metabolic therapeutics, particularly focusing on maintaining weight loss after discontinuation of GLP-1 therapy, with promising early clinical data from its Revita treatment [3][7][15] - The company anticipates significant milestones in 2025, including data updates from various cohorts and the submission of its first Clinical Trial Application for its Rejuva gene therapy platform [2][4][16] Company Updates - Fractyl Health reported first quarter 2025 financial results, highlighting rapid clinical and operational momentum [2] - The company has completed enrollment for the REMAIN-1 Pivotal Cohort ahead of schedule, with 6-month primary endpoint data expected in the second half of 2026 [9] - The REVEAL-1 Cohort has shown encouraging results, with an average weight regain of only 1.2% after GLP-1 discontinuation, compared to the typical 3% [7][8] Clinical Trials and Data - The REVEAL-1 Cohort is designed to provide real-world insights on Revita's performance after GLP-1 therapy cessation, with early data expected in June 2025 [5][7] - The REMAIN-1 Midpoint Cohort, which includes 45 participants, aims to assess Revita's efficacy in maintaining weight loss post-GLP-1 therapy, with initial efficacy analysis planned after 12 weeks of follow-up [6][8] - The Rejuva gene therapy platform is progressing towards first-in-human studies, with the first CTA module submission for RJVA-001 expected in June 2025 [10][16] Financial Performance - For Q1 2025, Fractyl reported a net loss of $23.7 million, an increase from $3.3 million in Q1 2024, primarily due to higher operating expenses [11][23] - Research and development expenses for the quarter were $19.4 million, up from $14.4 million in the same period last year, reflecting ongoing advancements in clinical programs [11][23] - As of March 31, 2025, the company had approximately $42.1 million in cash and cash equivalents, which is expected to fund operations into Q4 2025 [11][20]

[PART I FINANCIAL INFORMATION](index=10&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section presents the company's unaudited financial data and management's analysis for the quarter [Financial Statements (unaudited)](index=10&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) The unaudited condensed consolidated financial statements for Q1 2025 show a net loss of $23.7 million and a significant decrease in cash to $42.1 million, indicating a going concern uncertainty Condensed Consolidated Balance Sheet Data (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $42,108 | $67,464 | | Total current assets | $47,045 | $71,763 | | Total assets | $83,040 | $108,077 | | Total current liabilities | $18,801 | $19,775 | | Total liabilities | $76,665 | $79,653 | | Total stockholders' equity | $6,375 | $28,424 | Condensed Consolidated Statements of Operations (in thousands) | Account | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Revenue | $0 | $33 | | Research and development | $19,435 | $14,424 | | Selling, general and administrative | $5,324 | $7,132 | | Loss from operations | $(24,759) | $(21,542) | | Net loss | $(23,735) | $(3,322) | | Net loss per share, basic and diluted | $(0.49) | $(0.17) | Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(25,079) | $(11,711) | | Net cash used in investing activities | $(448) | $(1,059) | | Net cash provided by financing activities | $171 | $101,002 | | Net (decrease) increase in cash | $(25,356) | $88,232 | - The company has a history of operating losses and an accumulated deficit of **$439.0 million** as of March 31, 2025[41](index=41&type=chunk) - Management has concluded that substantial doubt exists about the Company's ability to continue as a going concern within one year from the report's issuance date[41](index=41&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) The MD&A details the company's strategic shift to prioritize the REMAIN-1 study and Rejuva platform, reporting a Q1 2025 net loss of $23.7 million, and expressing substantial doubt about its going concern ability [Business Overview and Strategic Reprioritization](index=25&type=section&id=Business%20Overview%20and%20Strategic%20Reprioritization) Fractyl Health initiated a strategic reprioritization on January 31, 2025, to focus on the REMAIN-1 pivotal study for Revita and advance its Rejuva gene therapy platform, pausing investment in Revita for T2D - On January 31, 2025, the company approved a Strategic Reprioritization to prioritize its REMAIN-1 pivotal study for Revita and advance its Rejuva gene therapy platform[97](index=97&type=chunk)[35](index=35&type=chunk) - As part of the reprioritization, the company has paused additional investment in its Revita programs for T2D, including the REVITALIZE-1 pivotal study and the Germany Real-World Registry study[97](index=97&type=chunk)[35](index=35&type=chunk) - The company plans to submit its first Clinical Trial Application (CTA) module for its gene therapy candidate, RJVA-001, in June 2025, with plans to dose the first patients in 2026, pending regulatory authorization[96](index=96&type=chunk)[107](index=107&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) Q1 2025 revenue dropped to zero, R&D expenses increased by $5.0 million due to Revita and Rejuva programs, while SG&A expenses decreased by $1.8 million, leading to a significant increase in net loss Comparison of Operations (Q1 2025 vs Q1 2024, in thousands) | Metric | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | $0 | $33 | $(33) | (100.0%) | | Research and development | $19,435 | $14,424 | $5,011 | 34.7% | | Selling, general and administrative | $5,324 | $7,132 | $(1,808) | (25.4%) | | Loss from operations | $(24,759) | $(21,542) | $(3,217) | 14.9% | | Net loss | $(23,735) | $(3,322) | $(20,413) | 614.5% | - R&D expenses increased by **$5.0 million**, primarily due to a **$2.2 million** increase in Revita clinical expenses for the REMAIN-1 study and a **$2.5 million** increase in Rejuva program development[115](index=115&type=chunk) - SG&A expenses decreased by **$1.8 million**, mainly due to a **$2.4 million** decrease in stock-based compensation[116](index=116&type=chunk) [Liquidity and Capital Resources](index=30&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company had $42.1 million in cash, sufficient only into Q4 2025, raising substantial doubt about its going concern ability and requiring additional financing to meet debt covenants - As of March 31, 2025, the company had cash and cash equivalents of **$42.1 million**[129](index=129&type=chunk)[41](index=41&type=chunk) - Management believes existing cash will only fund operations into the fourth quarter of 2025, which is not sufficient for the next twelve months, raising substantial doubt about the company's ability to continue as a going concern[129](index=129&type=chunk) - Without additional financing, the company will not be able to comply with the minimum liquidity covenant related to its 2023 Notes[129](index=129&type=chunk) - In March 2025, the company filed a Registration Statement on Form S-3, allowing for the potential offering of up to **$300.0 million** in securities[125](index=125&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) There have been no material changes to the company's market risk disclosures since its last Annual Report, with primary risks including interest rate, credit, foreign currency, and inflation - There have been no material changes to the market risk disclosures from the company's Annual Report on Form 10-K[152](index=152&type=chunk) [Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting identified during the quarter - Management concluded that as of March 31, 2025, the company's disclosure controls and procedures were effective at the reasonable assurance level[154](index=154&type=chunk) - There were no changes in internal control over financial reporting during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[156](index=156&type=chunk) [PART II OTHER INFORMATION](index=38&type=section&id=PART%20II%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity sales, defaults, and other disclosures [Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) The company reports that it is not currently subject to any material legal proceedings - The company is not subject to any material legal proceedings[158](index=158&type=chunk) [Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) This section details numerous risks, including limited operating history, substantial net losses, going concern uncertainty, lengthy regulatory approval processes, reliance on third parties, intense competition, and intellectual property challenges [Risks Related to Financial Condition and Capital Requirements](index=38&type=section&id=Risks%20Related%20to%20Our%20Financial%20Condition%20and%20Capital%20Requirements) The company faces significant risks due to its limited operating history, accumulated deficit of $439.0 million, and substantial doubt about its ability to continue as a going concern without raising additional, potentially dilutive, capital - The company has a limited operating history, has not completed any pivotal clinical studies, and has no products approved for commercial sale in the United States[160](index=160&type=chunk) - The company has incurred significant net losses since inception, with an accumulated deficit of approximately **$439.0 million** as of March 31, 2025[163](index=163&type=chunk) - There is substantial doubt about the company's ability to continue as a going concern, as it requires substantial additional capital to execute its operating plan and may be forced to delay or eliminate programs if funding is not secured[168](index=168&type=chunk)[171](index=171&type=chunk) [Risks Related to Development, Regulatory Approval and Commercialization](index=45&type=section&id=Risks%20Related%20to%20Development,%20Regulatory%20Approval%20and%20Commercialization) Significant hurdles exist in product development and commercialization, including lengthy and unpredictable regulatory approval processes, risks of clinical study failures, and challenges in securing market acceptance and adequate reimbursement - The regulatory approval process with the FDA and comparable foreign authorities is lengthy, costly, and inherently unpredictable[189](index=189&type=chunk) - The company is substantially dependent on the success of its lead product candidate, Revita, and its Rejuva gene therapy platform, both of which face significant development and regulatory risks[259](index=259&type=chunk)[262](index=262&type=chunk) - Even if products are approved, securing coverage and adequate reimbursement from third-party payors like Medicare and private insurers is critical and uncertain[230](index=230&type=chunk)[231](index=231&type=chunk) [Risks Related to Manufacturing](index=72&type=section&id=Risks%20Related%20to%20Manufacturing) The company's reliance on third-party, often sole-source, manufacturers for critical components and materials creates significant supply chain, quality control, and regulatory compliance risks, compounded by the vulnerability of its single manufacturing facility - The company relies on third-party manufacturers for sub-assembly components for Revita and materials for its Rejuva platform, increasing the risk of supply chain disruptions[317](index=317&type=chunk) - The company depends on third-party sole-source suppliers for certain components of Revita, and any interruption in these relationships could materially harm the business[329](index=329&type=chunk) - The company's single facility in Burlington, Massachusetts, for research, development, and manufacturing is vulnerable to natural or man-made disasters, which could halt operations[332](index=332&type=chunk)[333](index=333&type=chunk) [Risks Related to Intellectual Property](index=84&type=section&id=Risks%20Related%20to%20Our%20Intellectual%20Property) Success hinges on obtaining and defending intellectual property, but the patent landscape is complex, with risks of non-grant, invalidation, infringement litigation, and challenges in protecting trade secrets - The company's commercial success depends on its ability to obtain, maintain, and protect its intellectual property, but the scope of patent protection can be uncertain and may not be sufficiently broad[370](index=370&type=chunk) - The company faces the risk of infringing on the intellectual property rights of third parties, which could lead to costly litigation or require obtaining licenses on unfavorable terms[389](index=389&type=chunk)[394](index=394&type=chunk) - If unable to protect the confidentiality of its trade secrets and proprietary information, the company's business and competitive position could be harmed[408](index=408&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=104&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities during the quarter, and no material change in the intended use of IPO net proceeds - There were no unregistered sales of equity securities during the quarter[475](index=475&type=chunk) - There has been no material change in the expected use of the net proceeds from the company's IPO[477](index=477&type=chunk) [Defaults Upon Senior Securities](index=105&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports that there were no defaults upon senior securities during the period - None [Mine Safety Disclosures](index=105&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Fractyl Health, Inc - Not applicable [Other Information](index=105&type=section&id=Item%205.%20Other%20Information) No information requiring disclosure in a Form 8-K was identified, and no director or officer adopted or terminated a Rule 10b5-1 trading arrangement during Q1 2025 - During the three months ended March 31, 2025, no director or officer of the Company adopted or terminated a Rule 10b5-1 trading arrangement[483](index=483&type=chunk) [Exhibits](index=105&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including required CEO and CFO certifications and incorporated documents - The report includes required certifications from the CEO and CFO under Rule 13a-14(a)/15d-14(a) and Section 1350 of the Sarbanes-Oxley Act[484](index=484&type=chunk)

Core Insights - Fractyl Health, Inc. is focused on innovative metabolic therapeutics aimed at addressing the root causes of obesity and type 2 diabetes (T2D) [1][3] - The company will present preclinical data on its Rejuva gene therapy platform at the ASGCT 2025 Annual Meeting [1][2] Company Overview - Fractyl Health is dedicated to transforming the treatment of metabolic diseases from chronic management to durable, disease-modifying therapies [3] - The company is based in Burlington, Massachusetts, and aims to tackle the increasing morbidity and mortality associated with obesity and T2D [3] Rejuva Platform - The Rejuva platform is developing AAV-based gene therapies specifically targeting obesity and T2D, currently in preclinical development [4] - The platform utilizes advanced delivery systems and proprietary screening methods to identify effective gene therapy candidates [4] - The company plans to submit a Clinical Trial Application (CTA) for RJVA-001 in T2D in the first half of 2025, with preliminary data expected in 2026 if authorized [4]

Financial Data and Key Metrics Changes - In Q4 2024, revenue was generated from the commercial pilot in Germany, contributing to the financial position of the company [33] - Research and development expenses increased to $20.3 million in Q4 2024 from $10.1 million in Q4 2023, primarily due to progress in clinical studies and increased personnel-related expenses [34] - Selling, general and administrative expenses rose to $4.9 million in Q4 2024 from $2.8 million in Q4 2023, attributed to costs associated with being a publicly traded company [34] - The net loss for Q4 2024 was $25 million, compared to a net loss of $19.2 million in Q4 2023, mainly due to increased operating expenses [35] - As of December 31, 2024, the company had approximately $67.5 million in cash and cash equivalents, expected to fund operations through key clinical milestones into 2026 [36] Business Line Data and Key Metrics Changes - The Revita program is focused exclusively on weight maintenance post GLP-1 withdrawal, with the REMAIN-1 pivotal study prioritized [14] - Over 189 patients have enrolled in the REMAIN-1 study across 13 clinical sites, indicating strong demand for effective off-ramps from GLP-1 therapy [14] - Initial results from the REVEAL-1 cohort showed a patient maintaining weight loss during a challenging period, suggesting potential effectiveness of the Revita procedure [15] Market Data and Key Metrics Changes - The obesity market is under pressure, with over 70% of U.S. adults affected, leading to an estimated $170 billion in annual medical costs [16] - Public payers are reassessing coverage for GLP-1 treatments due to rising costs, with some states discontinuing coverage [17] Company Strategy and Development Direction - Fractyl aims to lead in the obesity treatment market by providing durable solutions for weight maintenance, focusing on both Revita and Rejuva platforms [37] - The company plans to leverage relationships with GI endoscopists to build a scalable commercial model for Revita [25] - The Rejuva platform is designed for physiologically regulated expression of GLP-1, aiming to reshape treatment paradigms in metabolic disease [27] Management's Comments on Operating Environment and Future Outlook - Management believes 2025 will be a pivotal year, with expectations for key clinical milestones and regulatory filings [12] - The company is confident in its ability to deliver long-term metabolic health solutions, addressing significant unmet needs in obesity care [37] - There is a growing recognition among public payers of the need for effective obesity treatments, which is expected to enhance the value proposition of Fractyl's offerings [84] Other Important Information - The REMAIN-1 study is the first of its kind to evaluate the efficacy of the Revita procedure in sustaining weight loss after GLP-1 drug discontinuation [19] - The FDA has granted Breakthrough Device designation for Revita, highlighting its potential in the weight maintenance market [10] Q&A Session Summary Question: Update on REMAIN-1 midpoint analysis and patient dropout rates - Nearly 100 patients have achieved the prespecified 15% total body weight loss, with a substantial number randomized for the study, and no dropouts due to lack of interest in the procedure [44] Question: Expectations for REVEAL-1 data presentation - The company plans to share data from about 10 patients in the REVEAL-1 study, with a focus on translating findings to the REMAIN study [59] Question: Gating items for Rejuva CTA submission - The company is on track to submit the first CTA module in the first half of 2025, with necessary preclinical verification testing and final testing ongoing [53] Question: Update on the first patient in REVEAL-1 - No additional information is available at this time, but the company plans to follow up with longer-term data on the patient [69] Question: Plans for strategic partnerships for commercialization - The company is in discussions with major players in the space regarding potential collaborations to bolster commercialization efforts [71] Question: Data collection for REVEAL-1 and weight regain analysis - The company is collecting various biomarker data and expects to share findings later in the year, with weight regain not significantly dependent on the specific GLP-1 drug used [79]