MAY 5, 2021 Next@ure Next-Generation Immunomedicines 7th Annual Truist Securities Life Sciences Summit Forward-Looking Statements To the extent that statements contained in this presentation are not descriptions of historical facts, they may be deemed to be forward-looking statements under the Private Securities Litigation Reform Act of 1995. Words such as "may," "will," "expect," "anticipate," "intend," " "near-term," "future" and similar expressions, as well as other words and expressions referencing futu ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the company's unaudited condensed financial statements and management's discussion and analysis of financial condition and results of operations [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This item provides the unaudited condensed financial statements, including the balance sheets, statements of operations and comprehensive loss, statements of stockholders' equity, and statements of cash flows, along with detailed notes explaining the company's accounting policies and specific financial line items [Condensed Balance Sheets](index=3&type=section&id=Condensed%20Balance%20Sheets%20as%20of%20March%2031,%202021%20(unaudited)%20and%20December%2031,%202020) This section presents the unaudited condensed balance sheets, detailing assets, liabilities, and stockholders' equity Condensed Balance Sheet Highlights (in thousands) | Metric | March 31, 2021 | December 31, 2020 | | :-------------------------------- | :------------- | :---------------- | | Total Assets | $290,959 | $306,644 | | Total Liabilities | $11,800 | $12,923 | | Total Stockholders' Equity | $279,159 | $293,721 | [Unaudited Condensed Statements of Operations and Comprehensive Loss](index=4&type=section&id=Unaudited%20Condensed%20Statements%20of%20Operations%20and%20Comprehensive%20Loss%20for%20the%20Three%20Months%20Ended%20March%2031,%202021%20and%202020) This section provides the unaudited condensed statements of operations and comprehensive loss, outlining revenue, expenses, and net income or loss Statements of Operations Highlights (in thousands) | Metric | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :------------------------------------ | :-------------------------------- | :-------------------------------- | | Revenue from former R&D arrangement | $0 | $22,378 | | Research and development expenses | $12,386 | $10,578 | | General and administrative expenses | $4,848 | $3,588 | | Net (loss) income | $(16,533) | $9,733 | | Basic EPS | $(0.60) | $0.35 | | Diluted EPS | $(0.60) | $0.33 | [Unaudited Condensed Statements of Stockholders' Equity](index=5&type=section&id=Unaudited%20Condensed%20Statements%20of%20Stockholders'%20Equity%20for%20the%20Three%20Months%20Ended%20March%2031,%202021%20and%202020) This section details changes in stockholders' equity, including stock-based compensation, common stock issuance, and net loss Stockholders' Equity Changes (in thousands) | Item | Three Months Ended March 31, 2021 | | :-------------------------------------- | :-------------------------------- | | Balance as of December 31, 2020 | $293,721 | | Stock-based compensation | $2,508 | | Issuance of common stock | $63 | | Unrealized loss on marketable securities | $(600) | | Net loss | $(16,533) | | Balance as of March 31, 2021 | $279,159 | [Unaudited Condensed Statements of Cash Flows](index=6&type=section&id=Unaudited%20Condensed%20Statements%20of%20Cash%20Flows%20for%20the%20Three%20Months%20Ended%20March%2031,%202021%20and%202020) This section presents the unaudited condensed statements of cash flows, categorizing cash movements into operating, investing, and financing activities Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Net cash used in operating activities | $(13,911) | $(10,594) | | Net cash provided by investing activities | $17,600 | $5,373 | | Net cash used in financing activities | $(354) | $(240) | | Net increase (decrease) in cash, cash equivalents and restricted cash | $3,335 | $(5,461) | | Cash, cash equivalents and restricted cash — end of period | $39,619 | $33,669 | [Notes to Unaudited Condensed Financial Statements](index=7&type=section&id=Notes%20to%20Unaudited%20Condensed%20Financial%20Statements) This section provides detailed explanatory notes integral to understanding the unaudited condensed financial statements - The accompanying notes are an integral part of these unaudited condensed financial statements[15](index=15&type=chunk)[18](index=18&type=chunk)[21](index=21&type=chunk) [1. Nature of the Business](index=7&type=section&id=1.%20Nature%20of%20the%20Business) This note describes NextCure's business as a clinical-stage biopharmaceutical company and its financial outlook regarding product sales and operating losses - NextCure is a clinical-stage biopharmaceutical company developing immunomedicines for cancer and immune-related diseases using its proprietary FIND-IO platform[22](index=22&type=chunk) - The company has not generated product sales revenue and expects to incur additional operating losses and negative operating cash flows for the foreseeable future[23](index=23&type=chunk) - COVID-19 has caused enrollment to slow in the Phase 2 portion of the NC318 clinical trial[25](index=25&type=chunk) [2. Summary of Significant Accounting Policies](index=8&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the company's significant accounting policies, including its status as an Emerging Growth Company and the adoption of new accounting standards - No material changes to significant accounting policies from the 2020 Annual Report[26](index=26&type=chunk) - The company is an Emerging Growth Company (EGC) and has elected to defer compliance with new accounting standards[30](index=30&type=chunk) - ASC 842 (Leases) will be effective for the company on January 1, 2022, and is expected to increase total assets and liabilities[31](index=31&type=chunk)[33](index=33&type=chunk) - ASU 2016-13 (Credit Losses) was adopted early, effective January 1, 2021, with no material impact on financial statements[34](index=34&type=chunk) [3. Restricted Cash](index=10&type=section&id=3.%20Restricted%20Cash) This note details the company's restricted cash balances, primarily held as collateral for its term loan - The company is required to maintain cash collateral for its **$5.0 million** term loan[36](index=36&type=chunk) Restricted Cash Balances (in thousands) | Metric | March 31, 2021 | December 31, 2020 | | :-------------------------------- | :------------- | :---------------- | | Restricted cash | $3,092 | $3,512 | [4. Marketable Securities](index=10&type=section&id=4.%20Marketable%20Securities) This note provides information on the company's marketable securities, including their fair value and realized gains Marketable Securities (in thousands) | Metric | March 31, 2021 | December 31, 2020 | | :-------------------- | :------------- | :---------------- | | Estimated Fair Value | $231,709 | $250,676 | - Realized gains on available-for-sale securities were approximately **$54,000** for Q1 2021 and **$64,000** for Q1 2020[39](index=39&type=chunk) - The company does not intend to sell securities with unrealized losses and believes market conditions are the primary factor for these changes[40](index=40&type=chunk) [5. Fair Value Measurements](index=11&type=section&id=5.%20Fair%20Value%20Measurements) This note presents the fair value measurements of the company's financial assets, categorized by valuation input levels Fair Value of Financial Assets (in thousands) as of March 31, 2021 | Asset Type | Total | Level 1 | Level 2 | Level 3 | | :------------------ | :------ | :------ | :------ | :------ | | Money market funds | $19,185 | $19,185 | $0 | $0 | | Corporate bonds | $231,709 | $0 | $231,709 | $0 | | **Total** | **$250,894** | **$19,185** | **$231,709** | **$0** | - No transfers between fair value levels occurred during the three months ended March 31, 2021 and 2020[45](index=45&type=chunk) [6. Former Agreement with Eli Lilly and Company](index=13&type=section&id=6.%20Former%20Agreement%20with%20Eli%20Lilly%20and%20Company) This note discusses the termination of the research and development collaboration agreement with Eli Lilly and Company and its impact on revenue - The research and development collaboration agreement with Eli Lilly and Company was terminated by Lilly effective March 3, 2020[46](index=46&type=chunk) - Revenue recognized from the Lilly Agreement was **$22.4 million** for the three months ended March 31, 2020, with no revenue in the comparable 2021 period[47](index=47&type=chunk) - No further quarterly research and development support payments are payable to the Company[47](index=47&type=chunk) [7. Stock-Based Compensation](index=13&type=section&id=7.%20Stock-Based%20Compensation) This note details the company's stock-based compensation plans and the associated expenses recognized for the periods - The 2019 Omnibus Incentive Plan became effective May 8, 2019, reserving **2,900,000 shares** plus certain shares from the 2015 Plan[49](index=49&type=chunk)[50](index=50&type=chunk) Stock-Based Compensation Expense (in thousands) | Category | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :-------------------------- | :-------------------------------- | :-------------------------------- | | Research and development | $958 | $452 | | General and administrative | $1,550 | $556 | | **Total** | **$2,508** | **$1,008** | - As of March 31, 2021, **$31.1 million** of total unrecognized compensation expense related to unvested options remains, to be recognized over approximately **2.7 years**[53](index=53&type=chunk) [8. Net (Loss) Income Per Share Attributable to Common Stockholders](index=17&type=section&id=8.%20Net%20(Loss)%20Income%20Per%20Share%20Attributable%20to%20Common%20Stockholders) This note provides the basic and diluted net loss or income per share attributable to common stockholders for the reported periods EPS Summary | Metric | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :---------- | :-------------------------------- | :-------------------------------- | | Basic EPS | $(0.60) | $0.35 | | Diluted EPS | $(0.60) | $0.33 | - For Q1 2021, all options were excluded from diluted EPS calculation as their effect would have been anti-dilutive due to the net loss[58](index=58&type=chunk) [9. Income Taxes](index=19&type=section&id=9.%20Income%20Taxes) This note explains the company's income tax position, including the absence of a provision or benefit and the maintenance of a full valuation allowance - No provision or benefit for income taxes was recorded for Q1 2021 or Q1 2020[61](index=61&type=chunk) - A full valuation allowance is maintained against deferred tax assets due to cumulative net losses[61](index=61&type=chunk)[62](index=62&type=chunk) - The CARES Act and ARPA 2021 had no significant financial impact on the company's condensed financial statements[64](index=64&type=chunk) [10. Commitments and Contingencies](index=19&type=section&id=10.%20Commitments%20and%20Contingencies) This note outlines the company's commitments and contingencies, including ongoing stockholder class action and shareholder derivative lawsuits - A stockholder class action (Ye Zhou v. NextCure, Inc., et. al.) was filed in September 2020, alleging securities law violations regarding NC318 and the FIND-IO platform[65](index=65&type=chunk) - A shareholder derivative lawsuit (Zach Liu v. Richman et. al.) was filed in March 2021, alleging breaches of fiduciary duty, unjust enrichment, and gross mismanagement[66](index=66&type=chunk) - The company intends to vigorously defend both actions and believes they are without merit, but cannot estimate the reasonably possible loss[68](index=68&type=chunk) - The financial statements are unaudited and prepared in conformity with GAAP for interim reporting[27](index=27&type=chunk) - No material changes to significant accounting policies from the 2020 Annual Report[26](index=26&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations for the three months ended March 31, 2021, compared to the same period in 2020. It covers the business overview, impact of COVID-19, financial performance, components of expenses, and liquidity, highlighting the transition from net income to net loss due to the termination of the Lilly Agreement and increased R&D - The company is a clinical-stage biopharmaceutical company developing immunomedicines for cancer and immune-related diseases[74](index=74&type=chunk) - The COVID-19 pandemic has caused delays and slowdowns in clinical trials, particularly for NC318[71](index=71&type=chunk)[83](index=83&type=chunk) - The company reported a net loss of **$16.5 million** for Q1 2021, compared to a net income of **$9.7 million** for Q1 2020, primarily due to the absence of revenue from the terminated Lilly Agreement[86](index=86&type=chunk) - Existing cash, cash equivalents, and marketable securities of **$268.2 million** are expected to fund operations into the second half of 2023[91](index=91&type=chunk)[110](index=110&type=chunk) [Overview](index=23&type=section&id=Overview) This section provides a business overview, detailing NextCure's clinical-stage product candidates and their development status - NextCure is a clinical-stage biopharmaceutical company developing first-in-class immunomedicines using its FIND-IO platform[74](index=74&type=chunk) - NC318, a lead product candidate targeting Siglec-15 (S15), is in a Phase 1/2 clinical trial for advanced solid tumors, with modifications planned for S15 patient pre-selection[75](index=75&type=chunk)[79](index=79&type=chunk) - NC410, targeting LAIR-1, is in a Phase 1/2 clinical trial for advanced solid tumors, with data expected in H2 2021[80](index=80&type=chunk) - NC762, targeting B7-H4, has an IND cleared and a Phase 1/2 clinical trial is planned for Q2 2021[81](index=81&type=chunk) [COVID-19](index=25&type=section&id=COVID-19) This section discusses the impact of the COVID-19 pandemic on clinical trials and uncertainties regarding its future effects - The COVID-19 pandemic has caused enrollment to slow in the Phase 2 portion of the NC318 clinical trial[83](index=83&type=chunk) - The full scope, duration, and severity of COVID-19 disruptions and their impact on the company's business and financial performance remain uncertain[83](index=83&type=chunk) [Financial Overview](index=25&type=section&id=Financial%20Overview) This section summarizes the company's financial position, including accumulated deficits, net loss, funding sources, and cash runway projections - The company has incurred net losses since inception, with an accumulated deficit of **$134.2 million** as of March 31, 2021[86](index=86&type=chunk) - Net loss for Q1 2021 was **$16.5 million**, compared to net income of **$9.7 million** for Q1 2020[86](index=86&type=chunk) - Operations are funded by public offerings (**$77.0 million** from IPO, **$160.9 million** from follow-on), private placements (**$164.4 million**), and a **$25.0 million** upfront payment from the former Lilly Agreement[87](index=87&type=chunk)[89](index=89&type=chunk)[90](index=90&type=chunk) - Cash, cash equivalents, and marketable securities totaled **$268.2 million** as of March 31, 2021, expected to fund operations into the second half of 2023[91](index=91&type=chunk) - Substantial additional funding will be required for continued operations and development[93](index=93&type=chunk) [Components of Our Results of Operations](index=29&type=section&id=Components%20of%20Our%20Results%20of%20Operations) This section breaks down the key components influencing the company's financial results, including revenue and operating expenses - The company has not generated any revenue from product sales through March 31, 2021[95](index=95&type=chunk) - Research and development expenses are expensed as incurred and are expected to increase substantially as product candidates advance[96](index=96&type=chunk)[97](index=97&type=chunk) - General and administrative expenses are also expected to increase due to staff expansion, occupancy costs, and public company operating expenses[101](index=101&type=chunk) [Revenue](index=29&type=section&id=Revenue) This section details the company's revenue streams, primarily from R&D arrangements, and notes the absence of product sales - No revenue from product sales has been generated to date[95](index=95&type=chunk) [Operating Expenses](index=29&type=section&id=Operating%20Expenses) This section outlines the company's operating expenses, including R&D and G&A costs, and their expected future trends - Operating expenses include research and development and general and administrative costs[96](index=96&type=chunk)[100](index=100&type=chunk) - Both R&D and G&A expenses are expected to increase substantially in the foreseeable future[97](index=97&type=chunk)[101](index=101&type=chunk) [Research and Development Expenses](index=29&type=section&id=Research%20and%20Development%20Expenses) This section details R&D expense components and anticipates their substantial increase due to advancing product candidates - R&D expenses include salaries, benefits, stock-based compensation, third-party agreements, consultant fees, laboratory supplies, and manufacturing costs[97](index=97&type=chunk) - R&D expenses are expected to increase substantially due to advancing product candidates, expanding trials, cGMP manufacturing, and discovery programs[97](index=97&type=chunk) - The duration and costs of future clinical trials are uncertain and depend on various factors, including regulatory requirements and patient enrollment[98](index=98&type=chunk)[99](index=99&type=chunk) [General and Administrative Expenses](index=30&type=section&id=General%20and%20Administrative%20Expenses) This section describes G&A expense elements and projects their substantial increase due to staff expansion and public company operations - G&A expenses include personnel costs, professional fees (legal, IP, accounting), rent, and other facility-related costs[100](index=100&type=chunk) - G&A expenses are expected to increase substantially due to staff expansion, higher legal/accounting fees, investor relations, and insurance premiums[101](index=101&type=chunk) [Other Income, Net](index=30&type=section&id=Other%20Income,%20Net) This section explains the nature of other income, net, primarily comprising interest income and term loan interest payments - Other income, net, primarily comprises interest income from marketable securities and interest payments on the term loan[102](index=102&type=chunk) [Results of Operations](index=31&type=section&id=Results%20of%20Operations) This section provides a comparative analysis of financial performance for Q1 2021 and 2020, highlighting changes in revenue and expenses Results of Operations Summary (in thousands) | Metric | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | Change | | :------------------------------------ | :-------------------------------- | :-------------------------------- | :------- | | Revenue from former R&D arrangement | $0 | $22,378 | $(22,378) | | Research and development | $12,386 | $10,578 | $1,808 | | General and administrative | $4,848 | $3,588 | $1,260 | | (Loss) income from operations | $(17,234) | $8,212 | $(25,446) | | Other income, net | $701 | $1,521 | $(820) | | Net (loss) income | $(16,533) | $9,733 | $(26,266) | [Comparison of the Three Months Ended March 31, 2021 and 2020](index=31&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20March%2031,%202021%20and%202020) This section offers a direct comparison of key financial metrics for the three months ended March 31, 2021, and 2020 Financial Performance Comparison (in thousands) | Metric | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | Change | | :------------------------------------ | :-------------------------------- | :-------------------------------- | :------- | | Revenue from former R&D arrangement | $0 | $22,378 | $(22,378) | | Operating expenses | $17,234 | $14,166 | $3,068 | | Net (loss) income | $(16,533) | $9,733 | $(26,266) | [Revenue from Research and Development Arrangement](index=31&type=section&id=Revenue%20from%20Research%20and%20Development%20Arrangement) This section explains the significant decrease in revenue due to the termination of the Eli Lilly and Company R&D agreement - Revenue decreased by **$22.4 million** to **$0** in Q1 2021 due to the termination of the Lilly Agreement[104](index=104&type=chunk) - No further quarterly research and development support payments are payable to the Company[104](index=104&type=chunk) [Research and Development Expenses](index=31&type=section&id=Research%20and%20Development%20Expenses) This section analyzes the increase in R&D expenses, attributing it to personnel costs and advancing development programs R&D Expenses (in thousands) | Category | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | Change | | :------------------------------------ | :-------------------------------- | :-------------------------------- | :------- | | External R&D expenses | $6,545 | $6,410 | $135 | | Internal R&D expenses | $5,841 | $4,168 | $1,673 | | **Total R&D expenses** | **$12,386** | **$10,578** | **$1,808** | - The increase was primarily driven by **$1.3 million** in personnel-related costs and costs for NC410 and other development programs[106](index=106&type=chunk) [General and Administrative Expenses](index=33&type=section&id=General%20and%20Administrative%20Expenses) This section details the increase in G&A expenses, primarily driven by higher personnel-related costs - G&A expenses increased by **$1.3 million** to **$4.9 million** in Q1 2021[107](index=107&type=chunk) - The increase was primarily driven by **$1.0 million** in personnel-related costs[107](index=107&type=chunk) [Other Income, Net](index=33&type=section&id=Other%20Income,%20Net) This section explains the decrease in other income, net, due to lower investment balances and reduced interest rates - Other income, net, decreased by **$0.8 million** to **$0.7 million** in Q1 2021[108](index=108&type=chunk) - The decrease was due to lower investment balances and reduced interest rates[108](index=108&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's financial liquidity, capital resources, cash flow activities, and future funding requirements - As of March 31, 2021, cash, cash equivalents, and marketable securities (excluding restricted cash) totaled **$268.2 million**[110](index=110&type=chunk) - Existing capital is expected to fund planned operations into the second half of 2023[110](index=110&type=chunk) - The company has a **$5.0 million** term loan, with **$3.1 million** outstanding as of March 31, 2021[111](index=111&type=chunk) - Substantial additional funding will be required, and failure to raise capital could lead to delays or termination of development programs[112](index=112&type=chunk) [Cash Flows](index=34&type=section&id=Cash%20Flows) This section provides a summary of cash flows from operating, investing, and financing activities for the reported periods Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Net cash used in operating activities | $(13,911) | $(10,594) | | Net cash provided by investing activities | $17,600 | $5,373 | | Net cash used in financing activities | $(354) | $(240) | | Net increase (decrease) in cash, cash equivalents and restricted cash | $3,335 | $(5,461) | [Cash Used in Operating Activities](index=34&type=section&id=Cash%20Used%20in%20Operating%20Activities) This section details net cash used in operating activities, primarily influenced by net loss and deferred revenue recognition - Net cash used in operating activities was **$13.9 million** for Q1 2021, primarily due to a net loss of **$16.5 million**[114](index=114&type=chunk) - Net cash used in operating activities was **$10.6 million** for Q1 2020, mainly due to **$22.4 million** in deferred revenue recognition[114](index=114&type=chunk) [Cash Used in Investing Activities](index=34&type=section&id=Cash%20Used%20in%20Investing%20Activities) This section outlines net cash provided by investing activities, mainly from proceeds from marketable securities - Cash provided by investing activities was **$17.6 million** for Q1 2021, primarily from **$18.4 million** in net proceeds from marketable securities[115](index=115&type=chunk) - Cash provided by investing activities for Q1 2020 was **$5.4 million**, primarily from **$6.8 million** in net proceeds from marketable securities[115](index=115&type=chunk) [Cash Provided by Financing Activities](index=34&type=section&id=Cash%20Provided%20by%20Financing%20Activities) This section describes net cash used in financing activities, primarily related to term loan payments - Cash used in financing activities was **$0.4 million** for Q1 2021 and **$0.2 million** for Q1 2020, both primarily consisting of payments related to the term loan[116](index=116&type=chunk) [Contractual Obligations and Commitments](index=34&type=section&id=Contractual%20Obligations%20and%20Commitments) This section notes no material changes to the company's contractual obligations during the first quarter of 2021 - No material changes to contractual obligations during Q1 2021[117](index=117&type=chunk) [Critical Accounting Policies, Significant Judgments and Use of Estimates](index=34&type=section&id=Critical%20Accounting%20Policies,%20Significant%20Judgments%20and%20Use%20of%20Estimates) This section highlights critical accounting policies, significant judgments, and estimates, noting no material changes - Financial statements require estimates and assumptions, especially for revenue recognition and share-based compensation[118](index=118&type=chunk) - No material changes to critical accounting policies were reported in Q1 2021[120](index=120&type=chunk) [Off-Balance Sheet Arrangements](index=36&type=section&id=Off-Balance%20Sheet%20Arrangements) This section confirms the company has not engaged in any off-balance sheet arrangements since its inception - The company has not engaged in any off-balance sheet arrangements since inception[121](index=121&type=chunk) [Recent Accounting Pronouncements](index=36&type=section&id=Recent%20Accounting%20Pronouncements) This section directs readers to Note 2 for a discussion of recent accounting pronouncements and their impact - Refer to Note 2 for discussion of recent accounting pronouncements[122](index=122&type=chunk) [Emerging Growth Company Status](index=36&type=section&id=Emerging%20Growth%20Company%20Status) This section clarifies the company's status as an Emerging Growth Company and its election for an extended transition period - NextCure is an Emerging Growth Company (EGC) under the JOBS Act[123](index=123&type=chunk) - The company has elected the extended transition period for adopting new accounting standards[123](index=123&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a smaller reporting company, NextCure is not required to provide quantitative and qualitative disclosures about market risk - Not required to provide market risk disclosures as a smaller reporting company[124](index=124&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, with the participation of the CEO and CFO, evaluated the effectiveness of the company's disclosure controls and procedures as of March 31, 2021, and concluded they were effective at a reasonable assurance level. No material changes in internal control over financial reporting occurred during the quarter - Disclosure controls and procedures were evaluated and deemed effective as of March 31, 2021[125](index=125&type=chunk) - No material changes in internal control over financial reporting occurred during Q1 2021[126](index=126&type=chunk) [Changes in Internal Control over Financial Reporting](index=36&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) This section confirms no material changes in internal control over financial reporting occurred during Q1 2021 - There were no changes in the company's internal control over financial reporting during the quarter ended March 31, 2021, that materially affected, or are reasonably likely to materially affect, its internal control over financial reporting[126](index=126&type=chunk) [PART II. OTHER INFORMATION](index=37&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section provides additional information beyond the financial statements, including legal proceedings, risk factors, and other required disclosures [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) This item incorporates by reference the legal proceedings information from Note 10 of the condensed financial statements, which details two ongoing lawsuits: a stockholder class action and a shareholder derivative lawsuit. Management believes the ultimate disposition of these and other ordinary course legal proceedings will not have a material adverse effect on the business - Refers to Note 10 for details on legal proceedings[127](index=127&type=chunk) - Management believes the ultimate disposition of legal proceedings will not materially adversely affect the business[127](index=127&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.Risk%20Factors) This section highlights significant risks associated with investing in NextCure's common stock, including the ongoing adverse impacts of the COVID-19 pandemic on clinical trials and operations, potential negative effects from interim results of the NC318 clinical trial, and the costs and distractions associated with current and future securities litigation - Investing in common stock involves a high degree of risk[128](index=128&type=chunk) - Updated risk factors include the impacts of the COVID-19 pandemic, potential adverse effects from NC318 clinical trial results, and securities litigation[128](index=128&type=chunk) [The impacts of the COVID-19 pandemic could continue to adversely affect our business.](index=37&type=section&id=The%20impacts%20of%20the%20COVID-19%20pandemic%20could%20continue%20to%20adversely%20af%20ect%20our%20business.) This section details how the COVID-19 pandemic has slowed clinical trial enrollment and poses ongoing risks to the company's operations and financial performance - COVID-19 has slowed enrollment in the NC318 trial and delayed the NC410 trial[129](index=129&type=chunk) - Potential adverse effects include patient/staff inability to participate, supply chain interruptions, site closures, and difficulties meeting protocol procedures[129](index=129&type=chunk) - The full scope, duration, and severity of COVID-19 disruptions and their impacts are highly uncertain[130](index=130&type=chunk)[132](index=132&type=chunk) [Recently announced interim results regarding our NC318 monotherapy Phase 1/2 clinical trial may adversely impact our product development efforts.](index=39&type=section&id=Recently%20announced%20interim%20results%20regarding%20our%20NC318%20monotherapy%20Phase%201/2%20clinical%20trial%20may%20adversely%20impact%20our%20product%20development%20ef%20orts.) This section discusses the interim results of the NC318 trial, the planned modifications for patient pre-selection, and the potential adverse impacts on development timelines and costs - Interim results for NC318 Phase 1/2 trial showed insufficient S15-positive patients for effective evaluation[133](index=133&type=chunk) - The company is modifying the Phase 2 portion of the trial to pre-select patients based on S15 expression, expected to begin in Q2 2021[133](index=133&type=chunk) - These developments could increase costs, lengthen timelines, and adversely impact regulatory approval and commercialization of NC318[133](index=133&type=chunk) [We are now and may in the future be subject to securities litigation, which can be expensive and could divert management's attention.](index=39&type=section&id=We%20are%20now%20and%20may%20in%20the%20future%20be%20subject%20to%20securities%20litigation,%20which%20can%20be%20expensive%20and%20could%20divert%20management's%20attention.) This section addresses the ongoing stockholder class action and shareholder derivative lawsuits, emphasizing their potential financial and operational burdens - The company is subject to a stockholder class action (Ye Zhou) and a shareholder derivative lawsuit (Zach Liu)[134](index=134&type=chunk)[135](index=135&type=chunk) - Litigation is expensive, can divert management's attention, and could adversely affect the business[136](index=136&type=chunk) - If costs exceed insurance coverage, the company may bear substantial direct expenses[137](index=137&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=41&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This item states that there were no unregistered sales of equity securities or use of proceeds to report for the period - None to report[139](index=139&type=chunk) [Item 3. Defaults Upon Senior Securities](index=41&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item states that there were no defaults upon senior securities to report for the period - None to report[140](index=140&type=chunk) [Item 4. Mine Safety Disclosures](index=41&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[141](index=141&type=chunk) [Item 5. Other Information](index=41&type=section&id=Item%205.%20Other%20Information) This item states that there is no other information to report for the period - None to report[142](index=142&type=chunk) [Item 6. Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This item lists the exhibits filed or furnished as part of the Quarterly Report, including certifications (Rule 13a-14(a), 18 U.S.C. Section 1350) and XBRL documents - Includes certifications by Michael Richman and Steven P. Cobourn[145](index=145&type=chunk) - XBRL Instance Document and Taxonomy Extension Documents are filed[145](index=145&type=chunk) [SIGNATURES](index=43&type=section&id=SIGNATURES) This section contains the required signatures from the company's principal executive and financial officers, certifying the accuracy of the report - Report signed by Michael Richman, President and CEO, and Steven P. Cobourn, CFO[149](index=149&type=chunk) - Date of signing: May 6, 2021[149](index=149&type=chunk)

APRIL 13, 2021 Next@ure Next-Generation Immunomedicines Needham Investor Conference Forward-Looking Statements To the extent that statements contained in this presentation are not descriptions of historical facts, they may be deemed to be forward-looking statements under the Private Securities Litigation Reform Act of 1995. Words such as "may," "will," "expect," "anticipate," "intend," " "near-term," "future" and similar expressions, as well as other words and expressions referencing future events, conditio ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to . Commission File Number: 001-38905 NextCure, Inc. (Exact name of registrant as specified in its charter) Delaware 04-5231247 (State or other ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section provides the unaudited condensed financial statements and management's discussion and analysis for NextCure, Inc [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed financial statements for NextCure, Inc. as of September 30, 2020, and for the three and nine-month periods then ended [Condensed Balance Sheets](index=3&type=section&id=Condensed%20Balance%20Sheets) The balance sheet as of September 30, 2020, shows total assets of $316.1 million, a decrease from $356.2 million at year-end 2019, primarily due to reduced cash and marketable securities Condensed Balance Sheets (in thousands) | | September 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Total current assets** | $296,981 | $339,995 | | **Total assets** | $316,078 | $356,168 | | **Total current liabilities** | $5,741 | $15,042 | | **Total liabilities** | $8,739 | $34,684 | | **Total stockholders' equity** | $307,339 | $321,484 | [Condensed Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For Q3 2020, the company reported a net loss of $16.4 million, increasing from $8.4 million in Q3 2019, while the nine-month net loss improved slightly to $21.1 million due to recognized revenue Statements of Operations Highlights (in thousands, except per share data) | | Three Months Ended Sep 30, 2020 | Three Months Ended Sep 30, 2019 | Nine Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2019 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $0 | $1,583 | $22,378 | $4,342 | | Research and development | $12,740 | $8,663 | $34,448 | $22,819 | | General and administrative | $4,659 | $2,622 | $12,918 | $6,995 | | Loss from operations | $(17,399) | $(9,702) | $(24,988) | $(25,472) | | **Net loss** | **$(16,367)** | **$(8,434)** | **$(21,142)** | **$(22,810)** | | Net loss per share | $(0.59) | $(0.37) | $(0.77) | $(1.81) | [Condensed Statements of Cash Flows](index=7&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) Net cash used in operating activities for the nine months ended September 30, 2020, was $38.7 million, with investing activities providing $27.0 million and financing activities using $1.0 million Condensed Statements of Cash Flows (in thousands) | | Nine Months Ended September 30, 2020 | Nine Months Ended September 30, 2019 | | :--- | :--- | :--- | | Net cash used in operating activities | $(38,676) | $(25,632) | | Net cash provided by (used in) investing activities | $27,025 | $(176,762) | | Net cash (used in) provided by financing activities | $(1,017) | $81,735 | | **Net decrease in cash, cash equivalents and restricted cash** | **$(12,668)** | **$(120,659)** | [Notes to Unaudited Condensed Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Condensed%20Financial%20Statements) The notes provide details on accounting policies, the impact of COVID-19, the terminated Lilly agreement, stock-based compensation, and a stockholder class action lawsuit - The company is a clinical-stage biopharmaceutical company focused on developing immunomedicines for cancer and other diseases using its proprietary FIND-IO platform[21](index=21&type=chunk) - The collaboration agreement with Eli Lilly and Company was terminated by Lilly effective March 3, 2020, leading to the recognition of the remaining deferred revenue of **$22.4 million** in the nine months ended September 30, 2020, with no further payments due[45](index=45&type=chunk)[46](index=46&type=chunk) - A stockholder class action lawsuit was filed on September 21, 2020, against the company, certain officers, and underwriters, alleging violations of securities laws regarding statements made about the lead product candidate, NC318, which the company intends to vigorously defend[60](index=60&type=chunk) - The COVID-19 pandemic has caused enrollment to slow in the Phase 2 clinical trial of NC318 and has raised concerns about monitoring patient safety[29](index=29&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=17&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's business overview, recent developments, and financial results, including progress of lead product candidates, impact of COVID-19, increased operating expenses, and liquidity sufficient into H2 2023 - The company's lead product candidate is NC318, for which a Phase 1/2 clinical trial is ongoing, with enrollment in the Phase 2 portion slowed due to COVID-19, and no current plans to advance the NSCLC and ovarian cancer cohorts[70](index=70&type=chunk)[71](index=71&type=chunk) - The second product candidate, NC410, entered a Phase 1/2 clinical trial in June 2020 for patients with advanced or metastatic solid tumors, after a delay due to the COVID-19 pandemic[73](index=73&type=chunk) - As of September 30, 2020, the company had **$291.2 million** in cash, cash equivalents, and marketable securities, which is expected to fund planned operations into the second half of 2023[82](index=82&type=chunk)[106](index=106&type=chunk) - The research and development collaboration agreement with Eli Lilly was terminated in March 2020, leading to the recognition of all remaining deferred revenue[79](index=79&type=chunk)[85](index=85&type=chunk) [Results of Operations](index=25&type=section&id=Results%20of%20Operations) Revenue for the nine months ended September 30, 2020, was $22.4 million from the terminated Lilly Agreement, while R&D and G&A expenses significantly increased due to expanded activities and public company costs Change in Operating Expenses (Nine Months Ended Sep 30, 2020 vs 2019) | Expense Category | 2020 (in millions) | 2019 (in millions) | Change (in millions) | Key Drivers | | :--- | :--- | :--- | :--- | :--- | | Research & Development | $34.4 | $22.8 | +$11.6 | $6.3M in personnel costs, $2.8M in lab supplies/services, $1.0M in clinical research costs | | General & Administrative | $12.9 | $7.0 | +$5.9 | $1.9M in personnel costs, $1.3M in professional fees, $0.9M in insurance | - Revenue for the nine months ended September 30, 2020, increased to **$22.4 million** from **$4.3 million** in 2019, due to the recognition of all deferred revenue from the Lilly Agreement upon its termination[97](index=97&type=chunk) [Liquidity and Capital Resources](index=27&type=section&id=Liquidity%20and%20Capital%20Resources) The company's operations are financed primarily through public offerings and the Lilly Agreement upfront payment, with **$291.2 million** in cash and equivalents as of September 30, 2020, sufficient to fund operations into H2 2023 - The company completed an IPO in May 2019, raising net proceeds of approximately **$77.0 million**, and a follow-on offering in November/December 2019, raising net proceeds of approximately **$160.9 million**[80](index=80&type=chunk)[81](index=81&type=chunk)[105](index=105&type=chunk) - The company will require additional capital to develop its product candidates and may seek it through equity or debt financings, strategic alliances, or licensing arrangements, as failure to raise capital could force delays or termination of development programs[108](index=108&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=30&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a smaller reporting company, NextCure is not required to provide the information requested by this item - The company is not required to provide quantitative and qualitative disclosures about market risk because it qualifies as a smaller reporting company[119](index=119&type=chunk) [Controls and Procedures](index=30&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of September 30, 2020, with no material changes in internal control over financial reporting - Management concluded that as of September 30, 2020, the company's disclosure controls and procedures were effective at the reasonable assurance level[120](index=120&type=chunk) - No changes occurred in the company's internal control over financial reporting during the quarter ended September 30, 2020, that have materially affected, or are reasonably likely to materially affect, internal controls[121](index=121&type=chunk) [PART II. OTHER INFORMATION](index=31&type=section&id=Part%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, unregistered sales of equity securities, and a list of exhibits [Legal Proceedings](index=31&type=section&id=Item%201.%20Legal%20Proceedings) This section references Note 9 of the financial statements, describing a stockholder class action lawsuit filed in September 2020, with no other material litigation expected - The company is subject to a stockholder class action lawsuit filed on September 21, 2020, related to statements made about its lead product candidate, NC318, which the company intends to defend vigorously[60](index=60&type=chunk)[123](index=123&type=chunk) [Risk Factors](index=31&type=page&id=Item%201A.%20Risk%20Factors) This section highlights significant risks including the adverse effects of the COVID-19 pandemic on clinical trials, difficulties in patient enrollment, dependence on third-party suppliers, potential negative impacts from NC318 trial interim results, and ongoing securities litigation - The COVID-19 pandemic has caused and could continue to cause significant disruptions to clinical trials, including slowed patient enrollment for NC318 and delayed trial initiation for NC410[125](index=125&type=chunk) - Interim results for the NC318 monotherapy trial, which showed a lack of response in NSCLC and ovarian cancer cohorts, may adversely impact product development, investor confidence, and the ability to raise capital[130](index=130&type=chunk)[131](index=131&type=chunk) - The company is subject to a securities class action lawsuit which could be expensive and divert management's attention, regardless of the outcome[132](index=132&type=chunk) - The company depends on third-party suppliers for key manufacturing materials, and any supply interruption, potentially exacerbated by COVID-19, could harm its ability to produce product candidates for clinical trials[129](index=129&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=34&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities during the period - None[134](index=134&type=chunk) [Exhibits](index=35&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report, including employment and consulting agreements, the non-employee director compensation program, and certifications by the CEO and CFO

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ⌧ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2020 or ◻ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to . Commission File Number: 001-38905 NextCure, Inc. (Exact name of registrant as specified in its charter) Delaware 04-5231247 (State or ot ...

MAY 2020 Next@ure Next-Generation Immunomedicines Forward-Looking Statements To the extent that statements contained in this presentation are not descriptions of historical facts, they may be deemed to be forward-looking statements under the Private Securities Litigation Reform Act of 1995. Words such as "may," "will," "expect," "anticipate," "intend," " "near-term," "future" and similar expressions, as well as other words and expressions referencing future events, conditions, or circumstances, are intended ...

PART I. FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The unaudited condensed financial statements for Q1 2020 show a net income of $9.7 million, a significant improvement from a $6.2 million net loss in the prior year, primarily due to $22.4 million revenue from the terminated Eli Lilly agreement [Condensed Balance Sheets](index=3&type=section&id=Condensed%20Balance%20Sheets) Condensed Balance Sheets (in thousands) | Financial Metric | March 31, 2020 (in thousands) | December 31, 2019 (in thousands) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $28,907 | $34,091 | | Marketable securities | $293,191 | $300,514 | | Total current assets | $326,664 | $339,995 | | Total assets | $343,472 | $356,168 | | **Liabilities & Equity** | | | | Total current liabilities | $8,152 | $15,042 | | Total liabilities | $11,715 | $34,684 | | Total stockholders' equity | $331,757 | $321,484 | - Total assets decreased from **$356.2 million** at the end of 2019 to **$343.5 million** as of March 31, 2020, while total liabilities significantly reduced from **$34.7 million** to **$11.7 million**, primarily due to deferred revenue recognition[9](index=9&type=chunk) [Condensed Statements of Operations and Comprehensive Income (Loss)](index=4&type=section&id=Condensed%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) Condensed Statements of Operations and Comprehensive Income (Loss) (in thousands) | Metric | Three Months Ended March 31, 2020 (in thousands) | Three Months Ended March 31, 2019 (in thousands) | | :--- | :--- | :--- | | Revenue | $22,378 | $1,357 | | Research and development | $10,578 | $6,513 | | General and administrative | $3,588 | $1,659 | | **Income (loss) from operations** | **$8,212** | **($6,815)** | | **Net income (loss)** | **$9,733** | **($6,155)** | | **Diluted EPS** | **$0.33** | **($4.46)** | - The company reported a **net income of $9.7 million** for Q1 2020, a significant turnaround from a **net loss of $6.2 million** in Q1 2019, driven by a substantial increase in revenue from a research and development arrangement[11](index=11&type=chunk) [Condensed Statements of Cash Flows](index=6&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) Condensed Statements of Cash Flows (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2020 (in thousands) | Three Months Ended March 31, 2019 (in thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | ($10,594) | ($7,080) | | Net cash provided by (used in) investing activities | $5,373 | ($935) | | Net cash used in (provided by) financing activities | ($240) | $2,970 | | **Net decrease in cash, cash equivalents and restricted cash** | **($5,461)** | **($5,045)** | - Net cash used in operating activities increased to **$10.6 million** in Q1 2020 from **$7.1 million** in Q1 2019, resulting in a **net decrease of $5.5 million** in total cash, cash equivalents, and restricted cash for the quarter[16](index=16&type=chunk) [Notes to Unaudited Condensed Financial Statements](index=7&type=section&id=Notes%20to%20Unaudited%20Condensed%20Financial%20Statements) - The company is a clinical-stage biopharmaceutical entity focused on discovering and developing immunomedicines for cancer and other immune-related diseases utilizing its proprietary FIND-IO platform[17](index=17&type=chunk) - The research and development collaboration agreement with Eli Lilly and Company was terminated without cause, leading to the recognition of all remaining deferred revenue, totaling **$22.4 million**, in Q1 2020[36](index=36&type=chunk)[37](index=37&type=chunk) - The COVID-19 pandemic has slowed enrollment in the Phase 2 portion of the NC318 clinical trial and temporarily delayed the initiation of a Phase 2 combination trial for NC318 and a Phase 1/2 trial for NC410[53](index=53&type=chunk) - Stock-based compensation expense for Q1 2020 was **$1.008 million**, an increase from **$0.383 million** in Q1 2019[44](index=44&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=17&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses clinical-stage operations, highlighting COVID-19's impact on trial delays, a Q1 2020 net income of $9.7 million due to the Lilly Agreement termination, increased operating expenses, and a belief that **$322.1 million** in cash is sufficient for the next 12 months [Overview](index=18&type=section&id=Overview) - NextCure is a clinical-stage biopharmaceutical company developing first-in-class immunomedicines for cancer and other immune-related diseases utilizing its proprietary FIND-IO platform[58](index=58&type=chunk) - The COVID-19 pandemic has caused significant disruptions, slowing patient enrollment for the Phase 2 trial of NC318 and temporarily delaying other planned trials for NC318 and NC410[59](index=59&type=chunk)[62](index=62&type=chunk)[63](index=63&type=chunk) - The company's lead product candidate, NC318, targeting Siglec-15 (S15), is in a Phase 1/2 clinical trial, and its second candidate, NC410, received IND acceptance from the FDA in Q1 2020[62](index=62&type=chunk)[63](index=63&type=chunk) [Results of Operations](index=26&type=section&id=Results%20of%20Operations) Results of Operations (in thousands) | Metric (in thousands) | Q1 2020 | Q1 2019 | Change | | :--- | :--- | :--- | :--- | | Revenue | $22,378 | $1,357 | $21,021 | | Research and development | $10,578 | $6,513 | $4,065 | | General and administrative | $3,588 | $1,659 | $1,929 | | **Net income (loss)** | **$9,733** | **($6,155)** | **$15,888** | - Revenue increased by **$21.0 million** due to the recognition of all deferred revenue from the terminated Lilly Agreement[90](index=90&type=chunk) - R&D expenses rose by **$4.1 million**, primarily due to a **$1.7 million** increase in lab supplies and services for NC318, NC410, and other programs, and a **$1.4 million** increase in personnel costs[91](index=91&type=chunk) - G&A expenses increased by **$1.9 million**, driven by higher professional fees, insurance, and personnel costs associated with operating as a public company[92](index=92&type=chunk) [Liquidity and Capital Resources](index=27&type=section&id=Liquidity%20and%20Capital%20Resources) - As of March 31, 2020, the company held **$322.1 million** in cash, cash equivalents, and marketable securities (excluding restricted cash)[72](index=72&type=chunk) - Management believes that existing cash, cash equivalents, and marketable securities are sufficient to fund planned operations for at least the next 12 months[72](index=72&type=chunk)[95](index=95&type=chunk) - The company has primarily financed operations through public offerings, private placements of preferred stock, and the upfront payment from the Lilly Agreement[94](index=94&type=chunk) Cash Flow Activity (in thousands) | Cash Flow Activity (in thousands) | Three Months Ended March 31, 2020 | Three Months Ended March 31, 2019 | | :--- | :--- | :--- | | Net cash used in operating activities | ($10,594) | ($7,080) | | Net cash provided by (used in) investing activities | $5,373 | ($935) | | Net cash used in (provided by) financing activities | ($240) | $2,970 | [Quantitative and Qualitative Disclosures about Market Risk](index=30&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company is not required to provide this information as it qualifies as a smaller reporting company - As a smaller reporting company, NextCure is not required to provide the information requested by this item[111](index=111&type=chunk) [Controls and Procedures](index=30&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated disclosure controls as of March 31, 2020, concluding their effectiveness, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation as of March 31, 2020, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective[112](index=112&type=chunk) - No changes in internal control over financial reporting occurred during Q1 2020 that materially affected, or are reasonably likely to materially affect, internal controls[113](index=113&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=31&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any legal proceedings expected to have a material adverse effect on its business - The company is not currently involved in any litigation or legal proceedings that management believes would have a material adverse effect on the business[114](index=114&type=chunk) [Risk Factors](index=31&type=section&id=Item%201A.%20Risk%20Factors) This section highlights significant business risks, emphasizing the ongoing and potential future impacts of the COVID-19 pandemic, including clinical trial delays, supply chain disruptions, and overall economic uncertainty - The COVID-19 pandemic has caused a slowdown in patient enrollment for the Phase 2 trial of NC318 and has delayed the initiation of other planned clinical trials for NC318 and NC410[116](index=116&type=chunk) - The pandemic could continue to adversely affect business operations, including interruptions to the supply chain, site closures, and difficulties in adhering to trial protocols, potentially impacting financial position and results[116](index=116&type=chunk)[117](index=117&type=chunk) - The company depends on third-party suppliers for key materials, and any supply interruption, potentially exacerbated by COVID-19, could materially harm its ability to manufacture product candidates and delay development[119](index=119&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities during the period - None[120](index=120&type=chunk) [Defaults Upon Senior Securities](index=32&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities during the period - None[121](index=121&type=chunk) [Mine Safety Disclosures](index=32&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[122](index=122&type=chunk) [Other Information](index=32&type=section&id=Item%205.%20Other%20Information) There is no other information to report for the period - None[123](index=123&type=chunk) [Exhibits](index=32&type=section&id=Item%206.%20Exhibits) This section provides an index of the exhibits filed as part of the Quarterly Report, including officer certifications and XBRL data files - The report includes an exhibit index listing certifications pursuant to the Sarbanes-Oxley Act and XBRL-related documents[124](index=124&type=chunk)[126](index=126&type=chunk)

Part I [Business Overview](index=5&type=section&id=Item%201.%20Business) NextCure is a clinical-stage biopharmaceutical company developing first-in-class immunomedicines for cancer and immune-related diseases, leveraging its FIND-IO platform and in-house manufacturing [Company and Strategy](index=5&type=section&id=Overview) NextCure is a clinical-stage biopharmaceutical company focused on developing novel immunomedicines for cancer and other diseases, advancing lead candidates and leveraging its FIND-IO platform - The company primarily focuses on developing first-in-class immunomedicines for cancer patients unresponsive to existing therapies[18](index=18&type=chunk) - Key strategic elements include advancing lead candidates NC318 and NC410, leveraging the FIND-IO platform, utilizing in-house cGMP manufacturing, and exploring non-oncology opportunities[33](index=33&type=chunk)[38](index=38&type=chunk) [Product Pipeline](index=9&type=section&id=Our%20Pipeline) NextCure's pipeline features lead candidates NC318 (S15) and NC410 (LAIR-1) in clinical development, alongside preclinical programs from its FIND-IO platform Clinical Pipeline Status | Product Candidate | Target | Indication | Development Phase | | :--- | :--- | :--- | :--- | | **NC318** | S15 | Advanced/Metastatic Solid Tumors | Phase 1/2 (Phase 2 enrolling) | | **NC410** | LAIR-1 | Advanced/Metastatic Solid Tumors | Phase 1/2 (Planned Q2 2020) | - NC318 Phase 1 preliminary data demonstrated a **complete response** and a **partial response** in NSCLC patients, advancing to Phase 2 in October 2019[19](index=19&type=chunk)[62](index=62&type=chunk) - The FDA accepted the IND for NC410 in Q1 2020, with a Phase 1/2 trial planned for Q2 2020 in advanced or metastatic solid tumors[20](index=20&type=chunk)[76](index=76&type=chunk) - The company is pursuing preclinical antibodies targeting a novel B7-family member, another immune modulator, and additional LAIR-1 monoclonal antibodies[96](index=96&type=chunk)[97](index=97&type=chunk)[98](index=98&type=chunk) [FIND-IO Discovery Platform](index=28&type=section&id=Our%20FIND-IO%20Discovery%20Engine) The FIND-IO platform is NextCure's proprietary function-based screening engine for identifying novel immune-modulating targets, expanding into non-oncology areas like autoimmunity - FIND-IO is a function-based screening platform identifying novel cell surface molecular interactions that drive functional immune responses[42](index=42&type=chunk)[99](index=99&type=chunk) - The platform integrates gene libraries, various immune and non-immune cell types, and functional outputs to identify new immune modulators[100](index=100&type=chunk) - The company is expanding the platform beyond oncology to discover targets in autoimmunity and inflammation via the new FIND-AI platform[108](index=108&type=chunk) [Collaboration Agreements](index=30&type=section&id=Our%20Collaboration%20Agreements) NextCure holds an exclusive license and sponsored research agreement with Yale University, while its collaboration with Eli Lilly was terminated in March 2020 - The company holds an exclusive, worldwide license from Yale University for S15 patents, requiring milestone payments up to **$2.975 million** per product and low single-digit royalties[109](index=109&type=chunk)[110](index=110&type=chunk) - A Sponsored Research Agreement with Yale provides up to **$12.4 million** in funding for new immunomedicine target discovery, expiring December 31, 2020[111](index=111&type=chunk) - The collaboration agreement with Eli Lilly, including a **$25.0 million** upfront payment and **$15.0 million** equity investment, was terminated by Lilly effective March 3, 2020[112](index=112&type=chunk) [Manufacturing](index=32&type=section&id=Manufacturing) NextCure operates its own cGMP-compliant manufacturing facility with 1,000-liter capacity, producing drug supply for preclinical and clinical trials, including NC318 - The company operates a dedicated, state-of-the-art cGMP manufacturing facility with an initial capacity of **1,000 liters**[113](index=113&type=chunk) - This facility manufactures drug supply for all preclinical studies and the NC318 Phase 1/2 clinical trial[113](index=113&type=chunk) [Intellectual Property](index=34&type=section&id=Intellectual%20Property) NextCure protects its intellectual property through patent applications for NC318/NC410, an exclusive license from Yale for S15, and trade secret protection for FIND-IO - As of year-end 2019, the company has **18 pending foreign** and **2 pending U.S. patent applications** for NC318 and NC410, expected to expire starting in 2037 if issued[119](index=119&type=chunk) - The company holds an exclusive license from Yale for S15 patents, expected to expire no earlier than 2036 if issued[120](index=120&type=chunk) - The FIND-IO platform is protected as a trade secret via confidentiality and invention assignment agreements[122](index=122&type=chunk) [Government Regulation](index=36&type=section&id=Government%20Regulation) NextCure's product candidates are regulated as biologics by the FDA and international authorities, requiring extensive preclinical and clinical development, ongoing post-approval compliance, and adherence to healthcare laws - Product candidates are regulated as biologics in the U.S., requiring extensive preclinical and clinical testing before BLA submission to the FDA[126](index=126&type=chunk)[128](index=128&type=chunk) - Post-approval, the company must comply with ongoing FDA regulations, including cGMP, adverse event reporting, and potential REMS requirements[165](index=165&type=chunk)[303](index=303&type=chunk) - The business is subject to healthcare laws including the federal Anti-Kickback Statute, False Claims Act, and HIPAA, regulating relationships with providers and payors[196](index=196&type=chunk)[335](index=335&type=chunk) - Commercial success depends on coverage and reimbursement from third-party payors like Medicare, Medicaid, and private insurers, subject to pricing pressures and healthcare reform[193](index=193&type=chunk)[317](index=317&type=chunk)[325](index=325&type=chunk) [Risk Factors](index=60&type=page&id=Item%201A.%20Risk%20Factors) The company faces significant financial, development, regulatory, commercial, operational, and global health risks, including a history of losses and reliance on unproven candidates - **Financial Risks:** The company has a history of significant net losses, including **$33.7 million in 2019**, and will require substantial additional financing to continue operations[211](index=211&type=chunk) - **Development & Regulatory Risks:** Clinical development is lengthy and uncertain, with the FIND-IO platform unproven and product candidates like NC318 and NC410 facing trial failure or non-approval risks[228](index=228&type=chunk)[241](index=241&type=chunk)[258](index=258&type=chunk) - **Commercial & Competition Risks:** Approved products may not achieve market acceptance, and the company faces intense competition from large, well-funded pharmaceutical companies[292](index=292&type=chunk)[416](index=416&type=chunk) - **Operational Risks:** The company has limited manufacturing experience, relies on third parties for key services and collaborations, and is highly dependent on key personnel[344](index=344&type=chunk)[396](index=396&type=chunk)[412](index=412&type=chunk) - **Global Health Risks:** The novel coronavirus outbreak could disrupt business operations, including clinical trial recruitment and supply chains[437](index=437&type=chunk) [Properties](index=82&type=section&id=Item%202.%20Properties) The company's headquarters, lab, and manufacturing facilities are located in Beltsville, Maryland, under leases expiring in 2025 and 2030 - The company's headquarters, lab, and manufacturing facilities are located in Beltsville, Maryland, under leases expiring in **2025** and **2030**[464](index=464&type=chunk) [Legal Proceedings](index=83&type=section&id=Item%203.%20Legal%20Proceedings) As of the report date, NextCure is not a party to any material legal proceedings - The company is not currently a party to any material legal proceedings[466](index=466&type=chunk) Part II [Market for Common Equity and Related Matters](index=83&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) NextCure's common stock trades on Nasdaq under "NXTC", the company has never paid dividends, and its May 2019 IPO raised approximately $76.9 million - Common stock is traded on the Nasdaq Global Select Market under the symbol **"NXTC"**[468](index=468&type=chunk) - The company has never declared dividends and does not plan to in the foreseeable future[469](index=469&type=chunk) - The May 2019 IPO generated net proceeds of approximately **$76.9 million**[470](index=470&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=83&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) For 2019, NextCure reported a net loss of $33.7 million, with increased R&D and G&A expenses, holding $334.6 million in cash expected to fund operations into mid-2023, following the Lilly agreement termination [Results of Operations](index=87&type=section&id=Results%20of%20Operations) In 2019, revenue was $6.3 million from the Lilly Agreement, while R&D expenses increased by $14.4 million and G&A expenses by $6.2 million, leading to a higher net loss Results of Operations (in thousands) | | Year Ended Dec 31, 2019 | Year Ended Dec 31, 2018 | Change | | :--- | :--- | :--- | :--- | | Revenue from research and development arrangement | $6,347 | $0 | $6,347 | | Research and development | $34,216 | $19,787 | $14,429 | | General and administrative | $9,613 | $3,409 | $6,204 | | **Loss from operations** | **($37,482)** | **($23,196)** | **($14,286)** | | Other income, net | $3,745 | $397 | $3,348 | | **Net loss** | **($33,737)** | **($22,799)** | **($10,938)** | - The **$14.4 million** increase in R&D expenses was driven by a **$4.4 million** increase in lab supplies, a **$4.1 million** increase in personnel costs, and a **$3.0 million** increase in NC318 clinical research costs[505](index=505&type=chunk) - The **$6.2 million** increase in G&A expenses was primarily due to a **$2.8 million** increase in professional fees and a **$1.2 million** increase in insurance expenses as a public company[507](index=507&type=chunk) [Liquidity and Capital Resources](index=88&type=section&id=Liquidity%20and%20Capital%20Resources) As of December 31, 2019, NextCure held $334.6 million in cash and marketable securities, bolstered by 2019 offerings, expected to fund operations into mid-2023, with net cash used in operations at $35.6 million - As of December 31, 2019, the company held **$334.6 million** in cash, cash equivalents, and marketable securities[486](index=486&type=chunk)[510](index=510&type=chunk) - The company raised approximately **$237.8 million** in net proceeds from its IPO and a follow-on public offering in 2019[509](index=509&type=chunk) - Management expects the current cash position to fund planned operations into the first half of **2023**[486](index=486&type=chunk)[510](index=510&type=chunk) Cash Flow Summary (in thousands) | | Year Ended Dec 31, 2019 | Year Ended Dec 31, 2018 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(35,623) | $7,992 | | Net cash used in investing activities | $(303,923) | $(3,063) | | Net cash provided by financing activities | $243,043 | $121,417 | [Financial Statements and Supplementary Data](index=94&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) The audited financial statements for 2019 and 2018 are presented, showing a 2019 net loss of $33.7 million, total assets of $356.2 million, and notes detailing key accounting policies and events Balance Sheet Highlights (in thousands) | | Dec 31, 2019 | Dec 31, 2018 | | :--- | :--- | :--- | | Cash and cash equivalents | $34,091 | $135,173 | | Marketable securities | $300,514 | $0 | | **Total Assets** | **$356,168** | **$147,628** | | Total current liabilities | $15,042 | $10,298 | | Deferred revenue, non-current | $15,950 | $21,736 | | **Total Liabilities** | **$34,684** | **$32,349** | | **Total Stockholders' Equity (Deficit)** | **$321,484** | **($46,944)** | - Upon the IPO closing in May 2019, all outstanding convertible preferred stock automatically converted into **15,560,569 shares** of common stock[563](index=563&type=chunk) - Subsequent Event: Lilly terminated the Lilly Agreement effective March 3, 2020, with the remaining **$22.4 million** in deferred revenue to be recognized in Q1 2020[695](index=695&type=chunk)[696](index=696&type=chunk) Part III [Directors, Executive Compensation, and Corporate Governance](index=119&type=section&id=Item%2010%2C%2011%2C%2012%2C%2013%2C%2014) Information on directors, executive compensation, security ownership, and corporate governance is incorporated by reference from the forthcoming 2020 Proxy Statement - Information regarding directors, executive compensation, security ownership, and other governance matters is incorporated by reference from the forthcoming **2020 Proxy Statement**[703](index=703&type=chunk)[704](index=704&type=chunk)[705](index=705&type=chunk)[706](index=706&type=chunk)[707](index=707&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=120&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section provides an index of all exhibits filed with the 10-K, including financial statements, corporate governance documents, and material agreements - This section contains the index of all exhibits filed with the **10-K**, including corporate governance documents, material agreements, and required certifications[711](index=711&type=chunk)[713](index=713&type=chunk)

MARCH 2020 Next@ure Next-Generation Immunomedicines Forward-Looking Statements To the extent that statements contained in this presentation are not descriptions of historical facts, they may be deemed to be forward-looking statements under the Private Securities Litigation Reform Act of 1995. Words such as "may," "will," "expect," "anticipate," "intend," " "near-term," "future" and similar expressions, as well as other words and expressions referencing future events, conditions, or circumstances, are intend ...