PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Unaudited H1 2025 financials report a **$63.3 million net loss**, increased accumulated deficit, and a **going concern warning** [Balance Sheets](index=3&type=section&id=Balance%20Sheets) Balance Sheet Summary (Unaudited) | (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $25,752 | $12,474 | | Marketable securities | $47,464 | $121,140 | | Total current assets | $76,876 | $135,895 | | **Total assets** | **$114,918** | **$175,515** | | **Liabilities & Stockholders' Equity** | | | | Total current liabilities | $20,908 | $25,641 | | **Total liabilities** | **$39,080** | **$44,056** | | Accumulated deficit | ($646,879) | ($583,563) | | **Total stockholders' equity** | **$75,838** | **$131,459** | [Statements of Operations and Comprehensive Loss](index=4&type=section&id=Statements%20of%20Operations%20and%20Comprehensive%20Loss) Statement of Operations Summary (Unaudited) | (in thousands, except per share data) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $25,784 | $29,509 | $54,600 | $56,918 | | General and administrative | $6,410 | $7,655 | $12,200 | $14,589 | | **Loss from operations** | **($32,194)** | **($37,164)** | **($66,800)** | **($71,507)** | | **Net loss** | **($31,231)** | **($34,740)** | **($63,316)** | **($66,171)** | | Net loss per share, basic and diluted | ($0.41) | ($0.46) | ($0.83) | ($0.87) | [Statements of Cash Flows](index=7&type=section&id=Statements%20of%20Cash%20Flows) Cash Flow Summary (Unaudited) | (in thousands) | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($60,306) | ($54,848) | | Net cash provided by investing activities | $73,707 | $57,340 | | Net cash (used in) provided by financing activities | ($123) | $45 | | **Net increase in cash, cash equivalents and restricted cash** | **$13,278** | **$2,537** | [Notes to Unaudited Interim Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Interim%20Financial%20Statements) Notes detail accounting policies, a **going concern warning**, R&D expenses, workforce reduction, and collaboration agreements - The Company has incurred operating losses since inception, with an accumulated deficit of **$646.9 million** as of June 30, 2025[28](index=28&type=chunk) - Management has concluded that **substantial doubt exists about the Company's ability to continue as a going concern**, as its cash, cash equivalents, and marketable securities of **$77.3 million** are not sufficient to fund operations for at least the next twelve months[29](index=29&type=chunk) - In May 2024, the Company entered into a license agreement with Pathos AI, Inc. for its PRMT5 inhibitor, PRT811, receiving a **$3.0 million upfront payment** All performance obligations were satisfied in the second half of 2024[68](index=68&type=chunk)[71](index=71&type=chunk) Research and Development Expenses by Program (Six Months Ended June 30) | (in thousands) | 2025 | 2024 | | :--- | :--- | :--- | | PRT3789 | $8,268 | $8,875 | | PRT7732 | $5,736 | $— | | Discovery programs | $5,756 | $10,603 | | Other | $2,701 | $6,143 | | General costs, including personnel related | $32,139 | $31,297 | | **Total research and development** | **$54,600** | **$56,918** | - During the second quarter of 2025, the Company reduced its workforce by approximately **11%**, incurring one-time costs of **$0.5 million**[88](index=88&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses clinical pipeline, Q2/H1 2025 operating expense decreases, liquidity, and Nasdaq delisting [Overview](index=26&type=section&id=Overview) - The company is a clinical-stage precision oncology company with a pipeline including PRT3789 (SMARCA2 degrader), PRT7732 (oral SMARCA2 degrader), precision ADC programs, and KAT6A selective degraders[91](index=91&type=chunk)[94](index=94&type=chunk)[96](index=96&type=chunk)[103](index=103&type=chunk) - PRT3789 has completed Phase 1, with updated data expected by **year-end 2025** A Phase 2 trial in combination with KEYTRUDA is ongoing[95](index=95&type=chunk) - The oral SMARCA2 degrader, PRT7732, is advancing rapidly in a Phase 1 trial, with an initial data update expected by **year-end 2025**[97](index=97&type=chunk) - On March 27, 2025, the company received a **delisting notice from Nasdaq** for failing to maintain a minimum bid price of **$1.00 per share** The company has until September 23, 2025, to regain compliance[105](index=105&type=chunk)[107](index=107&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) Comparison of Operating Results (Three Months Ended June 30) | (in thousands) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Research and development | $25,784 | $29,509 | ($3,725) | | General and administrative | $6,410 | $7,655 | ($1,245) | | **Total operating expenses** | **$32,194** | **$37,164** | **($4,970)** | | **Net loss** | **($31,231)** | **($34,740)** | **$3,509** | - The decrease in R&D and G&A expenses for Q2 2025 was primarily driven by lower non-cash stock-based compensation expense and a decrease in expenses related to SMARCA2 clinical trials[122](index=122&type=chunk)[125](index=125&type=chunk) Comparison of Operating Results (Six Months Ended June 30) | (in thousands) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Research and development | $54,600 | $56,918 | ($2,318) | | General and administrative | $12,200 | $14,589 | ($2,389) | | **Total operating expenses** | **$66,800** | **$71,507** | **($4,707)** | | **Net loss** | **($63,316)** | **($66,171)** | **$2,855** | [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) - As of June 30, 2025, the company had **$77.3 million** in cash, cash equivalents, restricted cash, and marketable securities[136](index=136&type=chunk) - The company states that its current cash position is **not sufficient to fund operating expenses and capital requirements for at least the next twelve months**, raising **substantial doubt about its ability to continue as a going concern**[136](index=136&type=chunk) - The company has a **$400 million effective shelf registration statement** and a **$75 million Open Market Sales Agreement (ATM facility)** in place to potentially raise additional capital[140](index=140&type=chunk)[141](index=141&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, no market risk disclosures are required for this item - As a smaller reporting company, Prelude Therapeutics is **not required to provide quantitative and qualitative disclosures about market risk**[155](index=155&type=chunk) [Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) Management confirmed effective disclosure controls and procedures with no material changes to internal controls - Management concluded that the company's disclosure controls and procedures were **effective** as of June 30, 2025[156](index=156&type=chunk) - There were **no changes in internal control over financial reporting** during the quarter that have materially affected, or are reasonably likely to materially affect, internal controls[157](index=157&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=42&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently involved in any material legal proceedings - The company reports **no material legal proceedings**[160](index=160&type=chunk) [Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) Key risks include potential Nasdaq delisting and substantial doubt about the company's going concern ability - A significant risk is the **potential delisting from Nasdaq** The company received a non-compliance notice on March 27, 2025, for its stock price falling below the **$1.00 minimum bid requirement**[162](index=162&type=chunk)[163](index=163&type=chunk) - The company has until **September 23, 2025**, to regain compliance with Nasdaq's minimum bid price rule, after which it may be eligible for an extension[164](index=164&type=chunk) - The financial statements contain a **'going concern' warning**, indicating **substantial doubt about the company's ability to continue operations** as its current cash will not be sufficient to fund operations for at least the next twelve months[167](index=167&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities were reported during the period - **None reported**[169](index=169&type=chunk) [Exhibits](index=45&type=section&id=Item%206.%20Exhibits) This section lists filed exhibits, including corporate documents, officer certifications, and XBRL data files

[Prelude Therapeutics Second Quarter 2025 Update](index=1&type=section&id=Prelude%20Therapeutics%20Second%20Quarter%202025%20Update) Prelude Therapeutics reports significant clinical pipeline advancements and a strong financial position for Q2 2025, with a focus on oral SMARCA2 degrader PRT7732 and a cash runway into Q2 2026 [Corporate and Pipeline Highlights](index=1&type=section&id=Corporate%20and%20Pipeline%20Highlights) Prelude Therapeutics highlights advancements in its oral SMARCA2 degrader PRT7732, strategic pipeline prioritization, and a strong cash position for Q2 2025 - The oral SMARCA2 degrader, PRT7732, is currently enrolling its seventh dosing cohort at 125 mg, with preliminary clinical data anticipated by the end of 2025[1](index=1&type=chunk) - The company has completed the Phase 1 study of its intravenous SMARCA2 degrader, PRT3789, but has paused further development to focus solely on the oral PRT7732 program[1](index=1&type=chunk)[2](index=2&type=chunk) - A development candidate for the oral KAT6A degrader program has been selected, with an Investigational New Drug (IND) application filing planned for the first half of 2026[1](index=1&type=chunk)[3](index=3&type=chunk)[7](index=7&type=chunk) - As of June 30, 2025, the company has **$77.3 million** in cash, cash equivalents, restricted cash, and marketable securities, which is expected to fund operations into the second quarter of 2026[1](index=1&type=chunk)[10](index=10&type=chunk) [Clinical Program Updates and Upcoming Milestones](index=2&type=section&id=Clinical%20Program%20Updates%20and%20Upcoming%20Milestones) Prelude strategically prioritizes its oral SMARCA2 degrader, advances its KAT6A program, and develops novel precision ADCs [SMARCA2 Degrader Development Program](index=2&type=section&id=SMARCA2%20Degrader%20Development%20Program) Prelude halts intravenous SMARCA2 degrader PRT3789 development to focus resources on the more promising oral PRT7732 due to its favorable clinical profile - The company is pausing further development of PRT3789 (IV) to focus solely on PRT7732 (oral) as the go-forward strategy for the SMARCA2 Program[2](index=2&type=chunk) - The decision was influenced by the potential need for higher target coverage and capital requirements to advance both agents simultaneously[2](index=2&type=chunk) - PRT7732 has shown a favorable clinical profile to date, including oral once-daily dosing, good safety and tolerability, and over **90% target degradation**[2](index=2&type=chunk)[3](index=3&type=chunk) [PRT3789 (Intravenous SMARCA2 Degrader)](index=2&type=section&id=PRT3789%20%E2%80%93%20A%20first-in-class%2C%20highly%20selective%2C%20intravenous%20SMARCA2%20degrader) Phase 1 clinical development for PRT3789 is complete, with further advancement contingent on partnership and final data expected by year-end 2025 - Phase 1 clinical development in patients with biomarker-selected SMARCA4-mutated cancers is complete[5](index=5&type=chunk) - Further advancement of the program is contingent on securing a partnership; internal resources are being redirected to PRT7732[5](index=5&type=chunk) - The company plans to provide updated data from the Phase 1 study by the end of 2025[5](index=5&type=chunk) [PRT7732 (Oral SMARCA2 Degrader)](index=2&type=section&id=PRT7732%20%E2%80%93%20A%20potent%2C%20highly%20selective%20and%20orally%20bioavailable%20SMARCA2%20degrader) PRT7732, an oral SMARCA2 degrader, is rapidly advancing in its Phase 1 trial, with initial data expected by year-end 2025 - Enrollment is advancing rapidly, with the seventh dose escalation cohort (125 mg once daily) currently enrolling patients[6](index=6&type=chunk) - An initial first-in-human data update, including PK/PD, safety, and initial clinical activity, is expected by year-end 2025[6](index=6&type=chunk) [KAT6A Oral Degrader Program](index=2&type=section&id=Highly%20selective%20KAT6A%20oral%20degrader%20program) Prelude is advancing a highly selective oral KAT6A degrader, targeting an IND filing in H1 2026, anticipating improved efficacy and tolerability - The company is advancing a development candidate and is on track to file an IND in the first half of 2026[7](index=7&type=chunk) - This program is developing what is believed to be the industry's first highly potent, selective, and orally bioavailable KAT6A selective degraders[7](index=7&type=chunk) - The selective degradation of KAT6A is hypothesized to offer improved efficacy, tolerability, and combinability compared to non-selective inhibitors[7](index=7&type=chunk) [Other Pipeline Programs](index=3&type=section&id=Other%20Pipeline%20Programs) Prelude is developing next-generation cancer therapies, including precision ADCs with novel SMARCA2/4 dual degrader payloads and mCALR-targeted ADCs - Developing potent SMARCA2/4 dual degraders as payloads for precision ADCs, which have shown significantly better in vivo efficacy and tolerability compared to traditional cytotoxic ADCs in preclinical models[8](index=8&type=chunk) - Developing mCALR-targeted precision ADCs for myelofibrosis (MF) and essential thrombocythemia (ET), targeting a neoantigen found in **25-35%** of patients[9](index=9&type=chunk) [Second Quarter 2025 Financial Results](index=3&type=section&id=Second%20Quarter%202025%20Financial%20Results) Prelude Therapeutics reported a narrowed net loss of **$31.2 million** for Q2 2025, driven by reduced operating expenses, ending the quarter with **$77.3 million** in cash Summary of Key Financial Metrics | Financial Metric | Q2 2025 | Q2 2024 | Change (YoY) | | :--- | :--- | :--- | :--- | | R&D Expenses | $25.8M | $29.5M | -12.5% | | G&A Expenses | $6.4M | $7.7M | -16.9% | | Net Loss | $31.2M | $34.7M | -10.1% | | Net Loss Per Share | $0.41 | $0.46 | -10.9% | [Financial Position](index=3&type=section&id=Cash%2C%20Cash%20Equivalents%2C%20Restricted%20Cash%20and%20Marketable%20Securities) As of June 30, 2025, Prelude Therapeutics held **$77.3 million** in cash and equivalents, projected to fund operations into Q2 2026 - Total cash, cash equivalents, restricted cash, and marketable securities were **$77.3 million** as of June 30, 2025[10](index=10&type=chunk) - The existing cash runway is anticipated to fund operations into the second quarter of 2026[10](index=10&type=chunk) [Operating Expenses](index=3&type=section&id=Operating%20Expenses) Total operating expenses decreased in Q2 2025, with R&D expenses falling to **$25.8 million** and G&A expenses to **$6.4 million** Operating Expenses Summary | Expense Category | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Research & Development | $25.8M | $29.5M | | General & Administrative | $6.4M | $7.7M | - The decrease in R&D expenses was primarily due to a decrease in expenses related to the company's SMARCA2 clinical trials[11](index=11&type=chunk) - The decrease in G&A expenses was primarily due to lower stock-based compensation, resulting from a lower valuation on recent grants[12](index=12&type=chunk) [Net Loss](index=3&type=section&id=Net%20Loss) Prelude's net loss for Q2 2025 narrowed to **$31.2 million** (**$0.41** per share), an improvement from **$34.7 million** in Q2 2024 Net Loss Summary | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Loss | $31.2M | $34.7M | | Net Loss Per Share | $0.41 | $0.46 | - Included in the Q2 2025 net loss was **$3.8 million** of non-cash expenses related to share-based payments, down from **$6.1 million** in Q2 2024[14](index=14&type=chunk) [Financial Statements](index=6&type=section&id=Financial%20Statements) This section presents Prelude Therapeutics' unaudited consolidated financial statements, including Statements of Operations and Balance Sheets for Q2 2025 [Statements of Operations and Comprehensive Loss](index=6&type=section&id=STATEMENTS%20OF%20OPERATIONS%20AND%20COMPREHENSIVE%20LOSS) For Q2 2025, Prelude reported total operating expenses of **$32.2 million** and a net loss of **$31.2 million**, an improvement from Q2 2024 Consolidated Statements of Operations and Comprehensive Loss | (in thousands, except per share data) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Operating expenses** | | | | Research and development | $25,784 | $29,509 | | General and administrative | $6,410 | $7,655 | | **Total operating expenses** | **$32,194** | **$37,164** | | Loss from operations | ($32,194) | ($37,164) | | Other income, net | $963 | $2,424 | | **Net loss** | **($31,231)** | **($34,740)** | | Net loss per share, basic and diluted | ($0.41) | ($0.46) | [Balance Sheets](index=7&type=section&id=BALANCE%20SHEETS) As of June 30, 2025, Prelude Therapeutics reported total assets of **$114.9 million**, total liabilities of **$39.1 million**, and stockholders' equity of **$75.8 million** Consolidated Balance Sheets | (in thousands) | June 30, 2025 (unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $25,752 | $12,474 | | Marketable securities | $47,464 | $121,140 | | **Total current assets** | **$76,876** | **$135,895** | | **Total assets** | **$114,918** | **$175,515** | | **Liabilities and Stockholders' Equity** | | | | Total current liabilities | $20,908 | $25,641 | | **Total liabilities** | **$39,080** | **$44,056** | | **Total stockholders' equity** | **$75,838** | **$131,459** | | **Total liabilities and stockholders' equity** | **$114,918** | **$175,515** |

PRT7732, once daily oral SMARCA2 degrader, currently enrolling at the seventh dosing cohort (125 mg); Company to provide an update with preliminary clinical data, including PK/PD, safety and initial clinical activity by year end 2025 PRT3789 is designed to treat patients with a SMARCA4 mutation. Patients with SMARCA4-mutated cancer, a particularly aggressive form of the disease, have a very poor clinical prognosis. Approximately 10% of all non- small cell lung cancers and 5% of all cancers broadly, harbor a ...

Summary of Prelude Therapeutics (PRLD) FY Conference Call - June 11, 2025 Company Overview - **Company**: Prelude Therapeutics (PRLD) - **Focus**: Development of targeted therapies, specifically SMARCA2 and CAT6 degraders for cancer treatment Key Points on SMARCA2 Degraders - **Agents in Development**: Two SMARCA2 degraders are in the clinic, one oral and one intravenous (IV) [2][3] - **IV Agent**: The IV agent has shown proof of concept for the novel pathway, with ongoing dose escalation and a maximum dose selected at 500 mg/m² [6][12] - **Efficacy Data**: An objective response rate of approximately 23% was reported for the IV agent, significantly higher than the expected 5-10% for the patient population [10][11] - **Patient Population**: Focus on upper gastrointestinal (GI) and non-small cell lung cancer (NSCLC) patients, particularly those with SMARCA4 mutations [8][9] - **Next Steps**: Full data set expected by the end of the year, with plans for a combination study with docetaxel [12][13] Key Points on Oral Degrader - **Development Status**: The oral agent is in dose escalation at 60 mg, with expectations to select a dose by the end of the year [23] - **Advantages**: Oral administration is preferred by patients for convenience and continuous dosing, potentially increasing therapeutic activity [16][17] - **Safety Profile**: Both agents have shown a clean safety profile with no dose-limiting toxicities (DLTs) reported [25][26] CAT6 Degrader Insights - **Target**: CAT6 is an epigenetic target with a focus on ER-positive breast cancer due to observed amplifications [34][37] - **Mechanism of Action**: The company is developing selective degraders for CAT6, aiming to reduce toxicities associated with existing therapies [38][39] - **Development Plans**: Plans to advance CAT6 into IND (Investigational New Drug) application next year, depending on capital allocation [45] Combination Strategies - **Potential Combinations**: Preclinical studies indicate potential synergies with immunotherapies like pembrolizumab and chemotherapy [28][29] - **Target Patient Populations**: Focus on frontline NSCLC patients, as they have limited treatment options and poor progression-free survival [30][31] Financial Overview - **Cash Position**: As of the latest report, the company has $103 million in cash, expected to last into Q2 2026, covering ongoing projects including SMARCA4, oral agents, and CAT6 [51] Additional Considerations - **ADC Pipeline**: The company is exploring antibody-drug conjugates (ADCs) to deliver degraders directly to tumors, enhancing treatment specificity [46][48] - **Strategic Collaborations**: Collaboration with Absella for antibody development is underway, aiming to expand treatment options for aggressive cancers [50] This summary encapsulates the critical insights and developments discussed during the conference call, highlighting Prelude Therapeutics' strategic focus on innovative cancer therapies and their ongoing clinical programs.

Summary of Prelude Therapeutics Conference Call Company Overview - Prelude Therapeutics is a precision oncology company focused on discovering and developing novel small molecules and degrader antibody conjugates for aggressive cancers that lack effective therapies [5][6] Key Updates and Core Points - **Lead Clinical Program**: The lead program targets the chromatin remodeling complex SMARCA2, with the first clinical candidate being a selective degrader molecule named 3,789, currently in clinical trials [5][6] - **Clinical Data**: Recent data presented showed a 23% response rate in patients with upper GI and lung tumors having SMARCA4 mutations at doses greater than 283 mg [11] - **Dose Selection**: The recommended phase 2 dose (RP2D) for the IV molecule has been set at 500 mg based on safety and efficacy data [11][13] - **Oral Molecule Development**: An oral molecule, 7,732, began clinical trials late last year, with rapid progress noted in patient enrollment and dose escalation [7][22] - **Research and Development**: Prelude is also advancing a new program called Cat6 Degrader, which is a selective degrader targeting Cat6a, with potential advantages over existing inhibitors [8][45] Upcoming Catalysts - **Data Updates**: The company plans to provide updates on both the IV and oral programs later this year, with a focus on the totality of phase one data and ongoing patient enrollment [16][23] - **IND Submission**: For the Cat6a program, the company aims to select a development candidate soon and hopes to submit an IND in early 2026 [48] Financial Position - As of the end of the last quarter, Prelude had $103 million in cash, which is expected to support operations into the second quarter of the following year [58] Competitive Landscape - Prelude acknowledges competition in the SMARCA space but emphasizes the unique aspects of their degrader approach, which may offer better safety profiles and efficacy compared to existing therapies [37][39] Additional Insights - **Partnerships**: Prelude is collaborating with Absella on developing dual degraders conjugated to antibodies, which have shown promising preclinical results [53][54] - **Patient Selection**: The company has established a biomarker for patient selection, enhancing the potential for successful clinical outcomes [21][39] Conclusion - Prelude Therapeutics is positioned well within the oncology space, with a strong pipeline of innovative therapies and a solid financial foundation to support its clinical and preclinical endeavors. The focus on selective degraders and the rapid advancement of both IV and oral programs highlight the company's commitment to addressing unmet medical needs in aggressive cancers [5][58]

Summary of Conference Call Company and Industry Overview - The discussion revolves around a biotechnology company focused on developing cancer therapies, specifically targeting unique pathways such as the SMARK pathway and CAT6 inhibitors. The company has two molecules in clinical trials: an intravenous (IV) agent and an oral agent, both aimed at addressing high unmet needs in cancer patients with specific mutations [1][2][3]. Core Points and Arguments SMARK Pathway and Clinical Progress - The company is advancing two molecules targeting the SMARK pathway, with initial proof of concept demonstrated for the IV product. The focus is on being data-driven to select the best path forward for the program [1]. - The company is also working on a CAT6A degrader, which is expected to address deficiencies in existing therapies and has shown promising preclinical results [2][6]. Differentiation and Competitive Landscape - The CAT6A selective degrader is differentiated from existing dual inhibitors by its reduced bone marrow toxicities, which are common in other treatments [5][6]. - The company has a competitive advantage due to its early entry into the clinic, having a year and a half of clinical data compared to competitors, which allows for better understanding of patient populations and treatment efficacy [21][22]. Clinical Data and Future Steps - Recent data showed a 23% response rate for the IV product in monotherapy, with a 100% response rate in upper GI cancer patients. The company aims to enhance treatment durability through combination therapies [13][14]. - The company plans to file an Investigational New Drug (IND) application for the CAT6A degrader in early 2026 and expects to have a development candidate this quarter [9]. Financial Position and Business Development - The company reported a cash position of $103.1 million, which is expected to last until the second quarter of the following year, providing sufficient runway for clinical programs [33]. - Business development efforts are ongoing to secure additional funding and partnerships, especially in the current capital-constrained environment [34][36]. Regulatory Environment - The company remains optimistic about regulatory interactions, believing that effective therapies will find support from the FDA. The team is experienced in navigating regulatory challenges [39][40]. Other Important Content - The company emphasizes the importance of safety data in upcoming reports and aims to present robust efficacy data once sufficient patient numbers are treated [24][25]. - The oral formulation is expected to provide patient convenience and potentially better outcomes due to daily administration, which is not possible with IV treatments [27][30]. - The company is strategically planning for both oral and IV therapies, considering specific indications where each may be more effective [17][18]. This summary encapsulates the key points discussed during the conference call, highlighting the company's strategic direction, clinical advancements, competitive positioning, financial health, and regulatory outlook.

PART I. FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The unaudited interim financial statements show a net loss of $32.1 million and substantial doubt about the company's ability to continue as a going concern [Balance Sheets (Unaudited)](index=3&type=section&id=Balance%20Sheets%20%28Unaudited%29) Total assets decreased to $141.3 million, driven by a reduction in marketable securities and a decline in stockholders' equity Condensed Consolidated Balance Sheets | (in thousands) | March 31, 2025 (unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $40,269 | $12,474 | | Marketable securities | $58,805 | $121,140 | | Total current assets | $102,403 | $135,895 | | **Total assets** | **$141,260** | **$175,515** | | **Liabilities & Stockholders' Equity** | | | | Total current liabilities | $19,787 | $25,641 | | **Total liabilities** | **$38,082** | **$44,056** | | Accumulated deficit | $(615,648) | $(583,563) | | **Total stockholders' equity** | **$103,178** | **$131,459** | [Statements of Operations and Comprehensive Loss (Unaudited)](index=4&type=section&id=Statements%20of%20Operations%20and%20Comprehensive%20Loss%20%28Unaudited%29) The company reported a net loss of $32.1 million for Q1 2025, a slight increase from the prior year, driven by higher R&D expenses Condensed Consolidated Statements of Operations and Comprehensive Loss | (in thousands) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Research and development | $28,816 | $27,409 | | General and administrative | $5,790 | $6,934 | | **Total operating expenses** | **$34,606** | **$34,343** | | Loss from operations | $(34,606) | $(34,343) | | Other income, net | $2,521 | $2,912 | | **Net loss** | **$(32,085)** | **$(31,431)** | | Net loss per share | $(0.42) | $(0.42) | [Statements of Changes in Stockholders' Equity (Unaudited)](index=5&type=section&id=Statements%20of%20Changes%20in%20Stockholders%27%20Equity%20%28Unaudited%29) Stockholders' equity declined to $103.2 million, primarily due to the quarterly net loss of $32.1 million - The primary drivers for the change in stockholders' equity during the first quarter of 2025 were the **net loss of $32.1 million** and **stock-based compensation of $3.8 million**[16](index=16&type=chunk) [Statements of Cash Flows (Unaudited)](index=7&type=section&id=Statements%20of%20Cash%20Flows%20%28Unaudited%29) Net cash used in operations was $34.2 million, offset by $62.2 million provided by investing activities from maturities of marketable securities Condensed Consolidated Statements of Cash Flows | (in thousands) | Three months ended March 31, 2025 | Three months ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(34,231) | $(31,791) | | Net cash provided by investing activities | $62,186 | $31,221 | | Net cash used in financing activities | $(160) | $(14) | | **Net increase (decrease) in cash** | **$27,795** | **$(584)** | [Notes to Unaudited Interim Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Interim%20Financial%20Statements) Notes highlight an accumulated deficit of $615.6 million and substantial doubt about the company's ability to continue as a going concern - The company has an **accumulated deficit of $615.6 million** as of March 31, 2025, and has incurred operating losses since inception[31](index=31&type=chunk) - Management has concluded that **substantial doubt exists about the company's ability to continue as a going concern**, as its cash, cash equivalents, and marketable securities of $103.1 million are not sufficient to fund operations for at least the next twelve months[32](index=32&type=chunk) - Total stock-based compensation expense was **$3.8 million** for the three months ended March 31, 2025, down from $5.5 million in the prior year period[80](index=80&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses its clinical-stage oncology focus, financial results, significant liquidity concerns, and a Nasdaq delisting notice [Overview](index=23&type=section&id=Overview) The company is a clinical-stage precision oncology firm focusing on its lead SMARCA2 degrader programs, PRT3789 and PRT7732 - The company's lead opportunities are its first-in-class SMARCA2 degrader compounds, **PRT3789 and PRT7732**, which are expected to demonstrate clinical proof-of-concept in 2025[94](index=94&type=chunk) - **PRT3789 (IV)** has completed monotherapy dose escalation, with 500 mg once weekly selected as the recommended Phase 2 dose[97](index=97&type=chunk) - The oral SMARCA2 degrader, **PRT7732**, has advanced rapidly in its Phase 1 trial, with an initial data update also expected in H2 2025[99](index=99&type=chunk) - On March 27, 2025, the company received a **delisting notice from Nasdaq** for failing to maintain a minimum bid price of $1.00 per share[104](index=104&type=chunk)[106](index=106&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) Operating expenses remained stable, with a $1.4 million increase in R&D costs offset by a $1.1 million decrease in G&A expenses Comparison of the Three Months Ended March 31, 2025 and 2024 | (in thousands) | Three months ended March 31, 2025 | Three months ended March 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Research and development | $28,816 | $27,409 | $1,407 | | General and administrative | $5,790 | $6,934 | $(1,144) | | **Total operating expenses** | **$34,606** | **$34,343** | **$263** | | **Net loss** | **$(32,085)** | **$(31,431)** | **$(654)** | - The increase in R&D expenses was primarily due to higher costs related to the company's **SMARCA2 clinical trials**[121](index=121&type=chunk) - The decrease in G&A expenses was primarily driven by a reduction in **non-cash stock-based compensation expense**[124](index=124&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) The company's $103.1 million in cash and securities is insufficient to fund operations for the next twelve months, raising going concern doubts - As of March 31, 2025, the company had **$103.1 million in cash, cash equivalents, restricted cash, and marketable securities**[127](index=127&type=chunk) - The company believes its existing cash will not be sufficient to fund operations for at least the next twelve months, which raises **substantial doubt about its ability to continue as a going concern**[127](index=127&type=chunk) - The company has a **$400 million shelf registration statement** and an **Open Market Sales Agreement for up to $75.0 million**, providing potential avenues for future financing[132](index=132&type=chunk)[133](index=133&type=chunk) [Cash Flows](index=35&type=section&id=Cash%20Flows) Cash from investing activities more than offset cash used in operations, resulting in a net cash increase for the quarter Cash Flow Summary | (in thousands) | Three months ended March 31, 2025 | Three months ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(34,231) | $(31,791) | | Net cash provided by investing activities | $62,186 | $31,221 | | Net cash used in financing activities | $(160) | $(14) | [Quantitative and Qualitative Disclosures About Market Risk](index=37&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Prelude Therapeutics is not required to provide this information - The company is a smaller reporting company and is **not required to provide the information** required under this item[147](index=147&type=chunk) [Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of the end of the reporting period - Based on an evaluation as of March 31, 2025, the Principal Executive Officer and Principal Financial and Accounting Officer concluded that the company's **disclosure controls and procedures were effective**[148](index=148&type=chunk) - **No changes in internal control over financial reporting** occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[149](index=149&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any material legal proceedings - The company is not presently a party to any legal proceedings that management believes would have a **material adverse effect** on its business[151](index=151&type=chunk) [Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) Key risks include potential Nasdaq delisting and substantial doubt about the company's ability to continue as a going concern - The company is at **risk of being delisted from Nasdaq** for failing to meet the minimum bid price requirement of $1.00 per share[153](index=153&type=chunk)[154](index=154&type=chunk)[155](index=155&type=chunk) - The financial statements include a statement regarding **substantial doubt about the company's ability to continue as a going concern**, as existing cash will not be sufficient to fund operations for at least the next twelve months[158](index=158&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=40&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[160](index=160&type=chunk) [Defaults Upon Senior Securities](index=40&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities during the period - None[161](index=161&type=chunk) [Mine Safety Disclosures](index=40&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[162](index=162&type=chunk) [Other Information](index=40&type=section&id=Item%205.%20Other%20Information) There is no other information to report for the period - None[163](index=163&type=chunk) [Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including officer certifications and Inline XBRL documents - The exhibits filed include **CEO and CFO certifications** pursuant to Sarbanes-Oxley Sections 302 and 906, and interactive data files (XBRL)[166](index=166&type=chunk)

[Corporate Update and Q1 2025 Highlights](index=1&type=section&id=Corporate%20Update%20and%20Q1%202025%20Highlights) The company achieved strong Q1 2025 execution, advancing SMARCA2 degrader programs and presenting initial KAT6A degrader preclinical data, with key clinical updates expected in H2 2025 - The company reported strong execution in Q1 2025, with rapid progress in its SMARCA2 degrader programs and the presentation of first preclinical data for its oral KAT6A degraders[2](index=2&type=chunk) - Key clinical updates for PRT3789 (SMARCA2 degrader) and PRT7732 (oral SMARCA2 degrader) are anticipated in the **second half of 2025**[1](index=1&type=chunk) Financial Position and Runway | Metric | Value | | :--- | :--- | | Cash, cash equivalents, restricted cash and marketable securities | $103.1 million (as of March 31, 2025) | | Cash Runway | Into the second quarter of 2026 | [Clinical Program Updates and Upcoming Milestones](index=1&type=section&id=Clinical%20Program%20Updates%20and%20Upcoming%20Milestones) This section details progress in SMARCA2 degrader clinical trials, KAT6A oral degrader development, and precision ADCs, with key milestones anticipated in 2025-2026 [PRT3789 (Intravenous SMARCA2 Degrader)](index=1&type=section&id=PRT3789%20%E2%80%93%20A%20first-in-class%2C%20highly%20selective%2C%20intravenous%20SMARCA2%20Degrader) PRT3789, an intravenous SMARCA2 degrader, completed monotherapy and docetaxel combination enrollment, established a 500 mg weekly Phase 2 dose, and is enrolling a KEYTRUDA® combination trial, with data expected in H2 2025 - PRT3789 is designed to treat patients with SMARCA4-mutated cancers, which represent approximately **10% of all non-small cell lung cancers (NSCLC)** and **5% of all cancers**, an area of high unmet medical need[3](index=3&type=chunk)[4](index=4&type=chunk) - Enrollment is complete for the monotherapy dose escalation (665 mg) and the combination with docetaxel. The recommended Phase 2 dose is **500 mg once weekly**[5](index=5&type=chunk) - A Phase 2 clinical trial is actively enrolling patients to evaluate PRT3789 in combination with KEYTRUDA® (pembrolizumab) under a collaboration with Merck[6](index=6&type=chunk) [PRT7732 (Oral SMARCA2 Degrader)](index=2&type=section&id=PRT7732%20%E2%80%93%20A%20potent%2C%20highly%20selective%20and%20orally%20bioavailable%20SMARCA2%20Degrader) PRT7732, an oral SMARCA2 degrader, is rapidly advancing in its Phase 1 dose escalation trial, with the fifth cohort (60 mg once daily) currently enrolling, and initial data expected in H2 2025 - PRT7732 is a distinct oral SMARCA2 degrader being evaluated in a Phase 1 trial for biomarker-selected SMARCA4 mutated cancers[8](index=8&type=chunk) - Enrollment has progressed quickly, with the trial currently enrolling patients in the **fifth dose escalation cohort at 60 mg once daily**[8](index=8&type=chunk) [Highly Selective KAT6A Oral Degrader Program](index=2&type=section&id=Highly%20selective%20KAT6A%20oral%20degrader%20program) Prelude is developing selective oral KAT6A degraders to improve efficacy and tolerability by avoiding KAT6B inhibition, with a development candidate expected in Q2 2025 and an IND filing in 2026 - The company believes its program is the industry's first to report a selective KAT6A degrader, which could improve the safety profile by avoiding KAT6B inhibition, a driver of hematologic toxicity[9](index=9&type=chunk) - A development candidate is expected to be nominated in the **second quarter of 2025**, with an Investigational New Drug (IND) application filing planned for **2026**[9](index=9&type=chunk) [Precision ADCs with SMARCA2/4 Dual Degrader Payload](index=3&type=section&id=Precision%20ADCs%20with%20SMARCA2%2F4%20dual%20degrader%20payload) In partnership with AbCellera, Prelude is developing precision ADCs with SMARCA2/4 dual degrader payloads, showing superior preclinical efficacy and tolerability, with the first development candidate expected in 2025 - The program uses potent SMARCA2/4 dual degraders as payloads for precision ADCs to inhibit cancer cell growth across multiple cancer types[12](index=12&type=chunk) - Prelude and its partner AbCellera anticipate nominating the first development candidate from this program in **2025**[12](index=12&type=chunk) [Upcoming Investor Conference](index=3&type=section&id=Upcoming%20Investor%20Conference) Company leadership will participate in a fireside chat at the Citizens 2025 Life Sciences Conference on May 7, 2025 - The company's leadership, including the CEO, President/CMO, and CSO, will participate in a fireside chat at the Citizens 2025 Life Sciences Conference on **May 7, 2025**[13](index=13&type=chunk) [First Quarter 2025 Financial Results](index=3&type=section&id=First%20Quarter%202025%20Financial%20Results) This section reviews Prelude Therapeutics' Q1 2025 financial performance, covering cash position, operating expenses, and net loss [Financial Position and Runway](index=3&type=section&id=Cash%2C%20Cash%20Equivalents%2C%20Restricted%20Cash%20and%20Marketable%20Securities) As of March 31, 2025, Prelude Therapeutics held **$103.1 million** in cash and equivalents, projected to fund operations into Q2 2026 Cash Position | Date | Cash, Cash Equivalents, Restricted Cash & Marketable Securities | | :--- | :--- | | March 31, 2025 | $103.1 million | - The existing cash is anticipated to fund operations into the **second quarter of 2026**[15](index=15&type=chunk) [Operating Expenses](index=3&type=section&id=Operating%20Expenses) Total operating expenses for Q1 2025 were **$34.6 million**, a slight increase driven by higher R&D for SMARCA2 clinical trials, partially offset by lower G&A due to reduced stock-based compensation [Research and Development (R&D) Expenses](index=3&type=section&id=Research%20and%20Development%20(R%26D)%20Expenses) R&D expenses increased to **$28.8 million** in Q1 2025, primarily due to higher costs associated with SMARCA2 clinical trials R&D Expense Comparison (in millions) | Period | R&D Expense | Non-cash Stock Comp. | Change Driver | | :--- | :--- | :--- | :--- | | Q1 2025 | $28.8 | $2.3 | Increased expense for SMARCA2 clinical trials | | Q1 2024 | $27.4 | $3.0 | - | [General and Administrative (G&A) Expenses](index=3&type=section&id=General%20and%20Administrative%20(G%26A)%20Expenses) G&A expenses decreased to **$5.8 million** in Q1 2025, primarily due to lower non-cash stock-based compensation from reduced grant valuation G&A Expense Comparison (in millions) | Period | G&A Expense | Non-cash Stock Comp. | Change Driver | | :--- | :--- | :--- | :--- | | Q1 2025 | $5.8 | $1.6 | Lower stock-based compensation | | Q1 2024 | $6.9 | $2.5 | - | [Net Loss](index=4&type=section&id=Net%20Loss) The company reported a net loss of **$32.1 million**, or **$0.42 per share**, for Q1 2025, comparable to the prior year Net Loss Comparison | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Loss | $(32.1) million | $(31.4) million | | Net Loss Per Share | $(0.42) | $(0.42) | [Financial Statements](index=6&type=section&id=Financial%20Statements) This section presents Prelude Therapeutics' unaudited statements of operations and comprehensive loss, and balance sheets for Q1 2025 and comparative periods [Statements of Operations and Comprehensive Loss](index=6&type=section&id=STATEMENTS%20OF%20OPERATIONS%20AND%20COMPREHENSIVE%20LOSS) The unaudited Q1 2025 statement of operations shows a net loss of **$32.1 million**, with total operating expenses slightly increasing to **$34.6 million** year-over-year Q1 2025 Statement of Operations (Unaudited, in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Research and development | $28,816 | $27,409 | | General and administrative | $5,790 | $6,934 | | **Total operating expenses** | **$34,606** | **$34,343** | | Loss from operations | $(34,606) | $(34,343) | | Other income, net | $2,521 | $2,912 | | **Net loss** | **$(32,085)** | **$(31,431)** | | Net loss per share | $(0.42) | $(0.42) | [Balance Sheets](index=7&type=section&id=BALANCE%20SHEETS) The unaudited balance sheet as of March 31, 2025, shows total assets of **$141.3 million** and liabilities of **$38.1 million**, a decrease from December 31, 2024, primarily due to reduced cash and marketable securities Balance Sheet Highlights (Unaudited, in thousands) | Line Item | March 31, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $40,269 | $12,474 | | Marketable securities | $58,805 | $121,140 | | **Total current assets** | **$102,403** | **$135,895** | | **Total assets** | **$141,260** | **$175,515** | | Total current liabilities | $19,787 | $25,641 | | **Total liabilities** | **$38,082** | **$44,056** | | **Total stockholders' equity** | **$103,178** | **$131,459** |

Core Insights - Prelude Therapeutics reported strong execution in Q1 2025, focusing on the development of SMARCA2 degraders and KAT6A degraders for aggressive cancers [2][3] - The company has completed enrollment for the PRT3789 monotherapy and combination studies, with updated results expected in the second half of 2025 [1][4] - Prelude's financial position includes $103.1 million in cash and equivalents, projected to fund operations into Q2 2026 [1][14] Clinical Program Updates - PRT3789 is a first-in-class intravenous SMARCA2 degrader targeting SMARCA4 mutations, which are found in approximately 10% of non-small cell lung cancers [3][4] - The company has completed dose escalation for PRT3789 and selected a recommended Phase 2 dose of 500 mg once weekly [4] - A Phase 2 trial is underway evaluating PRT3789 in combination with KEYTRUDA® for patients with SMARCA4-mutated cancers [5] Financial Performance - R&D expenses for Q1 2025 increased to $28.8 million from $27.4 million in the prior year, primarily due to SMARCA2 clinical trials [15] - General and administrative expenses decreased to $5.8 million from $6.9 million, attributed to lower stock-based compensation [16][17] - The net loss for Q1 2025 was $32.1 million, consistent with the previous year, with a net loss per share of $0.42 [18][22] Upcoming Milestones - Initial data for the PRT7732 oral SMARCA2 degrader is expected in the second half of 2025, with rapid enrollment in the ongoing Phase 1 trial [1][8] - Prelude is advancing its KAT6A degrader program, with candidate nomination anticipated in Q2 2025 and an IND filing planned for 2026 [9][10] - The company will participate in the Citizens 2025 Life Sciences Conference on May 7, 2025, featuring key executives [12]

Company Participation - Prelude Therapeutics will participate in the Citizens Life Sciences Conference in New York on May 7, 2025 [1] - The company's CEO, President and Chief Medical Officer, and Chief Scientific Officer will engage in a fireside chat during the conference [2] Company Overview - Prelude Therapeutics is a clinical-stage precision oncology company focused on developing innovative medicines for cancer patients with high unmet needs [3] - The company's pipeline includes first-in-class SMARCA2 degraders and a potentially best-in-class CDK9 inhibitor, along with next-generation degrader antibody conjugates [3] - Prelude aims to extend the promise of precision medicine to all cancer patients in need [3]