UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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 March 31, 2022 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: 001-39385 RELAY THERAPEUTICS, INC. (Exact Name of Registrant as Specified in its Charter) (State or other jurisdiction of incorporati ...

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, 2021 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: 001-39385 RELAY THERAPEUTICS, INC. (Exact name of Registrant as specified in its Charter) Delaware 47-3923475 (State or other jurisdicti ...

Company Presentation February 2022 Confidential | © 2022 Relay Therapeutics 1 Disclaimer This presentation contains forward-looking statements and information about our current and future prospects and our operations and financial results, which are based on currently available information. All statements other than statements of historical facts contained in this presentation, including statements regarding our strategy, future financial condition, future operations, projected costs, prospects, plans, obje ...

January 2022 RELAY® THERAPE U TI C S 40th Annual J.P. Morgan Healthcare Conference Company Presentation Confidential | © 2022 Relay Therapeutics 1 Disclaimer This presentation contains forward-looking statements and information about our current and future prospects and our operations and financial results, which are based on currently available information. All statements other than statements of historical facts contained in this presentation, including statements regarding our strategy, future financial ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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 September 30, 2021 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: 001-39385 RELAY THERAPEUTICS, INC. (Exact Name of Registrant as Specified in its Charter) (State or other jurisdiction of incorpo ...

PART I. FINANCIAL INFORMATION Presents unaudited financial statements and management's analysis of financial condition and operations [Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Presents unaudited condensed consolidated financial statements, including balance sheets, statements of operations, and cash flows [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Details assets, liabilities, and equity, showing a decrease in cash and an increase in contingent consideration liability Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $260,069 | $447,646 | | Investments | $411,151 | $230,415 | | Total current assets | $681,276 | $770,100 | | Total assets | $714,401 | $799,829 | | **Liabilities & Equity** | | | | Total current liabilities | $25,385 | $13,632 | | Contingent consideration liability | $48,465 | $0 | | Total liabilities | $95,872 | $36,536 | | Total stockholders' equity | $618,529 | $763,293 | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Reports increased net loss for Q2 and H1 2021, driven by ZebiAI acquisition expenses and rising R&D Statement of Operations Summary (in thousands) | Metric | Q2 2021 | Q2 2020 | H1 2021 | H1 2020 | | :--- | :--- | :--- | :--- | :--- | | Collaboration revenue | $844 | $0 | $1,796 | $0 | | Research and development expenses | $45,147 | $21,666 | $75,769 | $43,363 | | In-process R&D expenses | $123,000 | $0 | $123,000 | $0 | | General and administrative expenses | $14,422 | $6,053 | $27,156 | $10,814 | | Loss from operations | ($193,580) | ($27,719) | ($235,984) | ($54,177) | | **Net loss** | **($193,399)** | **($26,724)** | **($235,582)** | **($51,610)** | | Net loss per share, basic and diluted | ($2.10) | ($6.06) | ($2.58) | ($12.06) | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Shows positive operating cash flow for H1 2021 due to a large receivable payment, with significant investing activities Cash Flow Summary for the Six Months Ended June 30 (in thousands) | Activity | 2021 | 2020 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $18,500 | ($43,178) | | Net cash provided by (used in) investing activities | ($207,553) | $138,019 | | Net cash provided by financing activities | $3,176 | $258 | | **Net (decrease) increase in cash** | **($185,877)** | **$95,099** | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Provides details on accounting policies, the ZebiAI acquisition, revenue recognition, and commitments - The company is a clinical-stage precision medicines company focused on oncology and genetic diseases, with lead candidates RLY-4008, RLY-2608, and RLY-1971[31](index=31&type=chunk) - On April 22, 2021, the company acquired ZebiAI for upfront consideration of **~$20 million in cash** and **1.88 million shares** of common stock, plus up to **$85 million** in milestone payments and up to **$100 million** in earnout payments[52](index=52&type=chunk) - The ZebiAI acquisition was accounted for as an asset acquisition, resulting in a **$123.0 million** charge for acquired in-process research and development (IPR&D) and an **$11.9 million** loss on initial consolidation of a variable interest entity[53](index=53&type=chunk)[54](index=54&type=chunk)[55](index=55&type=chunk) - Under the Genentech agreement for RLY-1971, the company received a **$75 million** upfront payment in January 2021 and a **$5 million** milestone payment in May 2021, recognizing **$1.74 million** in revenue for H1 2021[58](index=58&type=chunk)[69](index=69&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Discusses financial condition, operational results, pipeline, and ZebiAI acquisition, confirming capital sufficiency into 2024 - The company is advancing its pipeline, with RLY-4008 (FGFR2 inhibitor) and RLY-1971 (SHP2 inhibitor) in clinical trials, and IND-enabling studies initiated for RLY-2608 (PI3Kα inhibitor)[87](index=87&type=chunk) - Key corporate developments include the global collaboration with Genentech for RLY-1971, the acquisition of ZebiAI, and a new discovery collaboration with EQRx[90](index=90&type=chunk)[91](index=91&type=chunk)[92](index=92&type=chunk) - The company believes its cash, cash equivalents, and investments of **$671.2 million** as of June 30, 2021, will fund operating expenses and capital expenditure requirements into **2024**[99](index=99&type=chunk) [Results of Operations](index=23&type=section&id=Results%20of%20Operations) Compares operating results for Q2 and H1 2021 vs. 2020, detailing increased net loss due to ZebiAI acquisition and R&D Comparison of Operating Results for the Three Months Ended June 30 (in thousands) | Item | 2021 | 2020 | Change | | :--- | :--- | :--- | :--- | | Revenue | $844 | $0 | $844 | | Research and development | $45,147 | $21,666 | $23,481 | | In-process research and development | $123,000 | $0 | $123,000 | | Loss on initial consolidation of VIE | $11,855 | $0 | $11,855 | | General and administrative | $14,422 | $6,053 | $8,369 | | **Net loss** | **($193,399)** | **($26,724)** | **($166,675)** | Comparison of Operating Results for the Six Months Ended June 30 (in thousands) | Item | 2021 | 2020 | Change | | :--- | :--- | :--- | :--- | | Revenue | $1,796 | $0 | $1,796 | | Research and development | $75,769 | $43,363 | $32,406 | | In-process research and development | $123,000 | $0 | $123,000 | | Loss on initial consolidation of VIE | $11,855 | $0 | $11,855 | | General and administrative | $27,156 | $10,814 | $16,342 | | **Net loss** | **($235,582)** | **($51,610)** | **($183,972)** | [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) Details cash position, operating cash flow drivers, and investing activities, confirming capital sufficiency into 2024 - The company had cash, cash equivalents, and investments totaling **$671.2 million** as of June 30, 2021[126](index=126&type=chunk) - Cash from operations was positive for H1 2021 due to the **$75.0 million** upfront payment from Genentech, received in January 2021[126](index=126&type=chunk)[128](index=128&type=chunk) - The company expects its current capital to fund operations and capital expenditures into **2024**[134](index=134&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=28&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Assesses market risk from interest rates and foreign currency, concluding no material impact from hypothetical changes - Primary market risk is interest income sensitivity on cash equivalents and investments; a hypothetical **100 basis point** adverse change is not expected to have a material impact[148](index=148&type=chunk) - Foreign currency exchange risk is limited and not considered material, with no formal hedging program implemented[150](index=150&type=chunk) [Controls and Procedures](index=28&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2021, with no material changes - Management concluded that as of June 30, 2021, the company's disclosure controls and procedures were effective[153](index=153&type=chunk) - No material changes occurred during the quarter affecting internal control over financial reporting[154](index=154&type=chunk) PART II. OTHER INFORMATION This section covers legal proceedings, risk factors, equity sales, and other required disclosures [Legal Proceedings](index=30&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no material litigation or legal proceedings as of June 30, 2021 - The company reports no material legal proceedings as of June 30, 2021[157](index=157&type=chunk) [Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors) Outlines material risks: clinical trial uncertainty, third-party reliance, funding needs, and intellectual property challenges [Risks Related to Product Candidates](index=30&type=section&id=Risks%20Related%20to%20Our%20Product%20Candidates) Highlights risks of clinical trial failure, patient enrollment difficulties, and the uncertainty of novel mechanisms of action - The company has never successfully completed any clinical trials and may be unable to do so, potentially delaying or preventing marketing approval[159](index=159&type=chunk) - Difficulties in enrolling patients in clinical trials, especially for targeted populations, could delay or prevent necessary regulatory approvals[166](index=166&type=chunk) - Market opportunities for product candidates may be smaller than estimated, adversely affecting potential revenue and profitability[187](index=187&type=chunk) [Risks Related to Reliance on Third Parties](index=38&type=section&id=Risks%20Related%20to%20Our%20Reliance%20on%20Third%20Parties) Details dependence on D. E. Shaw Research, CROs for trials, and single-source CMOs for manufacturing - The company's drug discovery depends heavily on its collaboration with D. E. Shaw Research and their proprietary supercomputer, Anton 2; termination could be materially adverse[200](index=200&type=chunk)[201](index=201&type=chunk) - Reliance on third-party CROs for clinical trials poses risks if they fail to perform or comply with regulations, harming regulatory approval prospects[207](index=207&type=chunk) - Contracting with single-source suppliers for manufacturing product candidates increases risks of insufficient quantities, unacceptable costs, or development delays[215](index=215&type=chunk)[220](index=220&type=chunk) [Risks Related to Financial Position and Capital Needs](index=43&type=section&id=Risks%20Related%20to%20Our%20Financial%20Position%20and%20Ability%20to%20Raise%20Additional%20Capital) Highlights limited operating history, significant losses, and need for substantial funding to avoid program delays - The company has a limited operating history, incurred significant losses since inception, and anticipates continued losses for the foreseeable future[233](index=233&type=chunk)[234](index=234&type=chunk) - Substantial additional funding is required to continue operations; failure to raise capital could force delays, reductions, or elimination of product development programs[239](index=239&type=chunk) [Risks Related to Intellectual Property](index=47&type=section&id=Risks%20Related%20to%20Our%20Intellectual%20Property) Focuses on challenges in patent protection, potential infringement claims, and co-ownership disputes with DESRES - Commercialization success depends on obtaining and maintaining sufficient patent protection for technology and products, which may be impaired if unsuccessful[253](index=253&type=chunk) - Third parties may initiate legal proceedings alleging intellectual property infringement, with uncertain and potentially materially adverse outcomes[270](index=270&type=chunk) - Co-owned intellectual property with D. E. Shaw Research under the DESRES Agreement could lead to disputes over rights and control[255](index=255&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=69&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Reports the issuance of 1.88 million common shares in a private offering for the ZebiAI acquisition on April 22, 2021 - On April 22, 2021, the company issued **1,883,487 shares** of common stock to former ZebiAI security holders as part of the acquisition consideration[378](index=378&type=chunk) [Other Information](index=69&type=section&id=Item%205.%20Other%20Information) This section indicates no other information to report - None[379](index=379&type=chunk) [Exhibits](index=70&type=section&id=Item%206.%20Exhibits) Lists exhibits filed with the Form 10-Q, including agreements, corporate documents, and officer certifications

[PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements for Q1 2021 and 2020, including balance sheets, operations, cash flows, and key accounting notes [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to **$771.3 million** as of March 31, 2021, primarily due to a reduction in cash offset by increased investments Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $262,720 | $447,646 | | Investments | $463,355 | $230,415 | | Total current assets | $742,434 | $770,100 | | **Total assets** | **$771,346** | **$799,829** | | **Liabilities & Equity** | | | | Total current liabilities | $16,083 | $13,632 | | **Total liabilities** | **$38,560** | **$36,536** | | **Total stockholders' equity** | **$732,786** | **$763,293** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) The company recognized its first collaboration revenue while operating expenses significantly increased, widening the net loss to **$42.2 million** for Q1 2021 Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended Mar 31, 2021 | Three Months Ended Mar 31, 2020 | | :--- | :--- | :--- | | Collaboration revenue | $952 | $0 | | Research and development expenses | $30,622 | $21,700 | | General and administrative expenses | $12,735 | $4,758 | | Loss from operations | ($42,405) | ($26,458) | | **Net loss** | **($42,184)** | **($24,886)** | | **Net loss per share, basic and diluted** | **($0.47)** | **($5.99)** | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities significantly improved to **$46.6 million** in Q1 2021, driven by Genentech receivable collection, while investing activities used **$233.6 million** Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended Mar 31, 2021 | Three Months Ended Mar 31, 2020 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $46,640 | ($22,334) | | Net cash provided by (used in) investing activities | ($233,621) | $50,371 | | Net cash provided by financing activities | $2,055 | $351 | | **Net (decrease) increase in cash** | **($184,926)** | **$28,388** | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes detail the Genentech collaboration, the subsequent acquisition of ZebiAI Therapeutics, and commitments under the D.E. Shaw Research agreement - In December 2020, the company entered into a collaboration and license agreement with Genentech for RLY-1971, receiving a **$75 million** upfront payment in January 2021. The company is eligible for up to **$695 million** in additional milestones plus tiered royalties[49](index=49&type=chunk)[50](index=50&type=chunk) - As a subsequent event, on April 15, 2021, the company acquired ZebiAI Therapeutics, Inc. for approximately **$85 million** in upfront consideration (**$20 million** cash, **$65 million** stock) plus potential future milestone payments[70](index=70&type=chunk) - The collaboration agreement with D. E. Shaw Research was amended to increase the annual fee from **$7.9 million** to **$9.875 million**, commencing August 16, 2021[66](index=66&type=chunk) Stock-Based Compensation Expense (in thousands) | Expense Category | Three Months Ended Mar 31, 2021 | Three Months Ended Mar 31, 2020 | | :--- | :--- | :--- | | Research and development | $4,151 | $897 | | General and administrative | $5,520 | $558 | | **Total** | **$9,671** | **$1,455** | [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 the clinical pipeline, increased operating expenses, **$1.0 million** in collaboration revenue, and the company's liquidity position expected to fund operations into 2024 - The company's cash, cash equivalents, and investments of **$726.1 million** as of March 31, 2021, are expected to fund operating expenses and capital expenditure requirements into 2024[85](index=85&type=chunk)[111](index=111&type=chunk) Comparison of Results of Operations (in thousands) | Metric | Three Months Ended Mar 31, 2021 | Three Months Ended Mar 31, 2020 | | :--- | :--- | :--- | | Revenue | $952 | $0 | | Research and development | $30,622 | $21,700 | | General and administrative | $12,735 | $4,758 | | **Loss from operations** | **($42,405)** | **($26,458)** | - R&D expenses increased by **$8.9 million** year-over-year, primarily due to a **$5.5 million** increase in employee-related costs (including **$3.3 million** in stock-based compensation) and a **$1.7 million** increase in clinical trial expenses for RLY-1971 and RLY-4008[100](index=100&type=chunk) - G&A expenses increased by **$8.0 million** year-over-year, mainly due to a **$6.2 million** increase in personnel costs (including **$5.0 million** in stock-based compensation) and a **$1.7 million** increase in other expenses like insurance[101](index=101&type=chunk) - In April 2021, the company acquired ZebiAI Therapeutics for upfront consideration of approximately **$85.0 million** (**$20.0 million** in cash and **$65.0 million** in common stock), with potential for additional milestone payments[86](index=86&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=24&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate sensitivity on its investment portfolio, with minimal foreign currency exchange risk due to U.S.-denominated operations - The company's main market risk is interest rate sensitivity on its cash and investment portfolio. A hypothetical **100 basis point** adverse movement is not expected to have a material impact[123](index=123&type=chunk) - Foreign currency exchange risk is not significant as operations are located in the United States and expenses are generally denominated in U.S. dollars[125](index=125&type=chunk) [Controls and Procedures](index=25&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2021, with no material changes to internal control over financial reporting during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[127](index=127&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, internal controls[128](index=128&type=chunk) [PART II. OTHER INFORMATION](index=26&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=26&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently involved in any legal proceedings expected to have a material adverse effect on its business - The company is not currently involved in any legal proceedings expected to have a material adverse effect on its business[132](index=132&type=chunk) [Risk Factors](index=26&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks including limited operating history, reliance on third parties for clinical development, need for substantial funding, and challenges related to competition and regulatory hurdles - The company has a limited operating history, has never successfully completed any clinical trials, and has incurred significant operating losses since inception, with an accumulated deficit of **$446.4 million** as of March 31, 2021[134](index=134&type=chunk)[207](index=207&type=chunk) - The business is highly dependent on its collaboration with D. E. Shaw Research and its proprietary supercomputer, Anton 2, for the Dynamo™ platform. Termination of this agreement could materially harm the business[174](index=174&type=chunk)[175](index=175&type=chunk) - The company relies on third parties to conduct clinical trials and manufacture product candidates, increasing risks related to quality, compliance, and supply chain disruptions[181](index=181&type=chunk)[188](index=188&type=chunk) - Substantial additional funding will be required to continue operations. Failure to raise capital when needed could force the company to delay, reduce, or eliminate development programs[212](index=212&type=chunk) - The COVID-19 pandemic poses a risk of material adverse effects on the business, including potential disruptions to clinical trials, supply chains, and employee productivity[221](index=221&type=chunk) - The company is an "emerging growth company" and a "smaller reporting company," which allows for reduced disclosure requirements that could make its common stock less attractive to investors[327](index=327&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=65&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of its equity securities during the period covered by this Form 10-Q - There were no unregistered sales of equity securities during the quarter[352](index=352&type=chunk) [Other Information](index=65&type=section&id=Item%205.%20Other%20Information) This section discloses significant agreements, including an amended collaboration with D. E. Shaw Research and a retention agreement with a key executive - On May 12, 2021, the company amended its agreement with D. E. Shaw Research (DESRES), increasing the annual fee from **$7.9 million** to approximately **$9.9 million**, effective August 16, 2021[353](index=353&type=chunk) - On May 10, 2021, the company entered into a retention agreement with Donald Bergstrom, M.D., Ph.D., providing for two potential cash retention payments of **$600,000** each on May 31, 2023, and May 31, 2024, contingent on his continued employment[355](index=355&type=chunk)[356](index=356&type=chunk) [Exhibits](index=66&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the quarterly report, including the ZebiAI merger agreement, D. E. Shaw Research amendment, and executive retention agreement - Key exhibits filed include the merger agreement for ZebiAI, amendments to the D. E. Shaw Research collaboration, and an executive retention agreement[358](index=358&type=chunk) [Signatures](index=67&type=section&id=Signatures) - The report was duly signed on May 13, 2021, by Sanjiv K. Patel, M.D., President and Chief Executive Officer, and Thomas Catinazzo, Senior Vice President, Finance[364](index=364&type=chunk)

PART I [Business Overview](index=7&type=section&id=Item%201.%20Business) Relay Therapeutics is a clinical-stage precision medicines company focused on targeted oncology, leveraging its proprietary Dynamo™ platform to transform drug discovery through unparalleled insights into protein motion [Overview](index=7&type=section&id=Overview) Relay Therapeutics is a clinical-stage precision medicines company focused on targeted oncology, leveraging its Dynamo™ platform for drug discovery - Relay Therapeutics is a clinical-stage precision medicines company focused on enhancing small molecule therapeutic discovery in targeted oncology, utilizing its **Dynamo™ platform** built on insights into protein motion[20](index=20&type=chunk) - The company's pipeline includes lead product candidates **RLY-1971** (SHP2 inhibitor, Phase 1, Genentech collaboration), **RLY-4008** (FGFR2 inhibitor, Phase 1), and the **RLY-PI3K1047 program** (IND-enabling studies in 2021), alongside **five discovery-stage programs** in precision oncology and genetic disease[21](index=21&type=chunk) - The company's **Motion Based Drug Design™ (MBDD)** approach leverages dynamic protein behavior, contrasting with conventional static structure-based drug design (SBDD)[22](index=22&type=chunk) [Key Drug Discovery Steps of Our Dynamo Platform](index=7&type=section&id=Key%20Drug%20Discovery%20Steps%20of%20Our%20Dynamo%20Platform) The Dynamo platform integrates experimental and computational approaches to center protein motion in drug discovery, operating through target modulation, hit finding, and lead optimization phases - The **Dynamo platform** integrates leading-edge experimental and computational approaches, including the **Anton 2 supercomputer**, to center protein motion in drug discovery and design[24](index=24&type=chunk)[25](index=25&type=chunk) - The platform operates in three key phases: **Target Modulation Hypothesis** (modeling protein function and identifying novel binding sites), **Hit Finding and Lead Generation** (designing activity-based and computational screens), and **Lead Optimization** (using advanced computational models to predict and design compounds)[28](index=28&type=chunk) - The Dynamo platform has the potential to address diverse disease targets, including those previously intractable, across precision oncology, genetic medicine, and other therapeutic modalities[26](index=26&type=chunk) [Our Programs](index=8&type=section&id=Our%20Programs) The company's pipeline includes lead candidates RLY-4008, RLY-PI3K1047, and RLY-1971, along with discovery-stage programs, advancing through clinical and IND-enabling studies - **RLY-4008** is an oral, selective inhibitor of fibroblast growth factor receptor 2 (FGFR2), with a first-in-human clinical trial initiated in **September 2020** and an initial clinical update anticipated in the **second half of 2021**[29](index=29&type=chunk) - The **RLY-PI3K1047 program** targets cancer-associated mutant variants of phosphoinositide 3-kinase alpha (PI3Kα H1047X mutants) via a novel allosteric mechanism, with IND-enabling studies expected to begin in **2021**[30](index=30&type=chunk) - **RLY-1971** is an oral, small molecule inhibitor of SHP2, currently in a Phase 1 dose escalation study. In **December 2020**, the company entered a global collaboration and license agreement with **Genentech** for its development and commercialization, with a combination trial with Genentech's KRASG12C inhibitor (GDC-6036) expected in **2021**[33](index=33&type=chunk)[34](index=34&type=chunk) RLY-1971 Genentech Agreement Financials | Payment Type | Amount (in millions USD) | | :----------- | :----------------------- | | Upfront Payment | $75 | | Near-term Payments | $25 | | Development, Commercialization, Sales-based Milestones (No U.S. Profit/Cost Share) | Up to $695 | | Development, Commercialization, Sales-based Milestones (U.S. Profit/Cost Share) | Up to $410 | | Royalties (No U.S. Profit/Cost Share) | Low-to-mid-teens % | | Royalties (U.S. Profit/Cost Share) | Low-to-mid-teens % | | Additional Royalties | N/A (upon regulatory approval of RLY-1971 + GDC-6036 combination) | [Our Strategy](index=10&type=section&id=Our%20Strategy) The company's strategy focuses on advancing lead oncology programs, continuously enhancing its Dynamo platform, targeting intractable diseases, and selectively engaging in strategic collaborations - The company's mission is to leverage protein motion insights to discover, develop, and commercialize small molecule therapies for debilitating and life-threatening diseases[37](index=37&type=chunk) - Key strategic elements include rapidly advancing lead precision oncology programs (**RLY-4008** and **RLY-PI3K1047**), continuously enhancing the **Dynamo platform**, harnessing platform insights against intractable targets in oncology and other therapeutic areas (e.g., rare genetic diseases), and selectively entering strategic collaborations[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk)[41](index=41&type=chunk) [Our Dynamo Platform](index=11&type=section&id=Our%20Dynamo%20Platform) The Dynamo platform integrates advanced experimental and computational methods, including the Anton 2 supercomputer, to accelerate Motion Based Drug Design from hit to development candidate - The **Dynamo platform** integrates leading-edge experimental (e.g., room-temperature crystallography, Cryo-EM) and computational (e.g., molecular dynamics, machine learning) approaches to pivot from static structure-based drug design to **Motion Based Drug Design (MBDD)**[42](index=42&type=chunk)[45](index=45&type=chunk)[51](index=51&type=chunk) - The platform utilizes the **Anton 2 supercomputer**, accessed through a collaboration with D. E. Shaw Research, to perform long timescale molecular dynamics simulations (**tens of microseconds**), significantly accelerating the understanding of protein motion compared to conventional methods[25](index=25&type=chunk)[52](index=52&type=chunk)[53](index=53&type=chunk)[54](index=54&type=chunk) - The MBDD process involves three key phases: **Target Modulation Hypothesis** (understanding dynamic protein behavior and identifying novel binding sites), **Hit Finding and Lead Generation** (designing integrated experimental and virtual screens), and **Lead Optimization** (using computational models and machine learning to prioritize and design compounds)[47](index=47&type=chunk)[48](index=48&type=chunk)[55](index=55&type=chunk)[57](index=57&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk)[62](index=62&type=chunk)[65](index=65&type=chunk)[66](index=66&type=chunk) - The Dynamo platform has demonstrated significantly faster timelines for advancing from a validated hit to a development candidate (**2 years for RLY-1971**, **18 months for RLY-4008**) compared to conventional drug discovery (**3-5+ years**)[67](index=67&type=chunk)[68](index=68&type=chunk)[69](index=69&type=chunk) [Our Therapeutic Opportunity](index=16&type=section&id=Our%20Therapeutic%20Opportunity) The Dynamo platform targets precision medicine opportunities in oncology and monogenic diseases, offering advantages like clear causal links and increased translational success - The **Dynamo platform** focuses on precision medicine targets, specifically genetically validated alterations in oncology (**over 125 genetic drivers identified in 89% of tumors**) and monogenic diseases (**over 4,000 genetic drivers causing 7,000+ rare phenotypes**)[70](index=70&type=chunk)[71](index=71&type=chunk)[72](index=72&type=chunk) - This focus offers advantages such as a clear causal link to disease, the ability to precisely target genetically identifiable patients, and an increased likelihood of translational success[74](index=74&type=chunk)[75](index=75&type=chunk)[76](index=76&type=chunk) - Beyond small molecules, the platform could also be deployed for other therapy types, such as large molecules including peptide or protein therapeutics[77](index=77&type=chunk) [Our Product Pipeline and Programs](index=17&type=section&id=Our%20Product%20Pipeline%20and%20Programs) The company's pipeline primarily focuses on precision oncology, developing orally available small molecule candidates for oncogenic targets, largely retaining full development and commercialization rights - The company's pipeline initially focuses on precision oncology, generating orally available small molecule product candidates for previously intractable oncogenic targets, with most programs (except SHP2) retaining full development and commercialization rights[78](index=78&type=chunk) [RLY-4008, a selective inhibitor of FGFR2](index=18&type=section&id=RLY-4008%2C%20a%20selective%20inhibitor%20of%20FGFR2) RLY-4008 is an oral, selective FGFR2 inhibitor designed to overcome limitations of non-selective inhibitors, currently in a Phase 1 clinical trial for FGFR2-altered solid tumors - **RLY-4008** is an oral, small molecule, selective inhibitor of **FGFR2**, designed to overcome limitations of non-selective FGFR inhibitors, such as dose-limiting hyperphosphatemia (caused by FGFR1 inhibition) and resistance mutations[81](index=81&type=chunk)[82](index=82&type=chunk)[85](index=85&type=chunk)[87](index=87&type=chunk) - Preclinical studies demonstrated RLY-4008's high selectivity for FGFR2 (**over 200-fold vs. FGFR1**) and its ability to induce tumor regression in various FGFR2-altered cancer models (e.g., ICC, gastric, endometrial cancer) without causing hyperphosphatemia in rat models[97](index=97&type=chunk)[98](index=98&type=chunk)[99](index=99&type=chunk)[102](index=102&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk)[105](index=105&type=chunk)[106](index=106&type=chunk)[108](index=108&type=chunk)[109](index=109&type=chunk)[112](index=112&type=chunk) - RLY-4008 retains activity against common FGFR2 resistance mutations (e.g., V565F, N550K) and RLY-1971 (SHP2 inhibitor) has shown potential to overcome bypass resistance to FGFR2 inhibition in patient-derived cell lines[110](index=110&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk)[115](index=115&type=chunk)[116](index=116&type=chunk)[118](index=118&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk)[122](index=122&type=chunk)[123](index=123&type=chunk) - A first-in-human Phase 1 clinical trial for **RLY-4008** in patients with advanced solid tumors having oncogenic FGFR2 alterations was initiated in **September 2020**, with an initial clinical update expected in **H2 2021**[95](index=95&type=chunk)[125](index=125&type=chunk)[127](index=127&type=chunk) [Mutant-PI3Kα Inhibitor Program](index=27&type=section&id=Mutant-PI3K%CE%B1%20Inhibitor%20Program) The RLY-PI3K1047 program targets PI3Kα H1047X mutants via a novel allosteric mechanism, aiming to avoid toxicities of non-selective inhibitors, with IND-enabling studies planned for 2021 - The **RLY-PI3K1047 program**, with lead compounds like RTX-1 and RTX-2, targets **PI3Kα H1047X mutants** via a novel allosteric mechanism, aiming to avoid dose-limiting toxicities (e.g., hyperglycemia, hyperinsulinemia) associated with non-mutant-selective PI3K inhibitors[131](index=131&type=chunk)[134](index=134&type=chunk)[136](index=136&type=chunk)[137](index=137&type=chunk)[142](index=142&type=chunk)[143](index=143&type=chunk)[145](index=145&type=chunk)[146](index=146&type=chunk) - Preclinical data show **RTX-1** and **RTX-2** are **5-10-fold selective** for H1047R mutant PI3Kα over wild-type, selective over other PI3K isoforms, and inhibit tumor growth in vivo with minimal increases in serum insulin levels[147](index=147&type=chunk)[148](index=148&type=chunk)[150](index=150&type=chunk)[152](index=152&type=chunk)[153](index=153&type=chunk)[154](index=154&type=chunk)[156](index=156&type=chunk)[157](index=157&type=chunk)[158](index=158&type=chunk) - IND-enabling studies for a differentiated PI3Kα H1047X mutant-selective inhibitor are expected to begin in **2021**, with plans for monotherapy and combination trials in advanced cancer patients[131](index=131&type=chunk)[159](index=159&type=chunk) PI3Kα Addressable Patient Populations (US, Annual) | PI3Kα Mutation | Indication | Biomarker Frequency (%) | Biomarker Positive Late Line Incidence (patients) | Biomarker Positive Comprehensive Incidence (patients) | | :------------- | :--------- | :---------------------- | :---------------------------------------------- | :---------------------------------------------------- | | H1047X | Breast Cancer | 13.9% | 6,000 | 37,000 | | | Colorectal Cancer | 3.0% | 2,000 | 4,000 | | | Endometrial Cancer | 8.2% | 1,000 | 5,000 | | | Lung Cancer | 0.9% | 1,000 | 2,000 | | | **Total** | | **10,000** | **48,000** | | E542X/E545X | Breast Cancer | 11.6% | 5,000 | 31,000 | | | Colorectal Cancer | 8.3% | 4,000 | 12,000 | | | Endometrial Cancer | 9.4% | 1,000 | 6,000 | | | Lung Cancer | 3.6% | 5,000 | 8,000 | | | **Total** | | **15,000** | **57,000** | [RLY-1971, an inhibitor of SHP2](index=34&type=section&id=RLY-1971%2C%20an%20inhibitor%20of%20SHP2) RLY-1971 is an oral SHP2 inhibitor that stabilizes SHP2 in its inactive conformation, currently in a Phase 1 study and being developed in collaboration with Genentech for combination therapies - **RLY-1971** is an oral, small molecule **SHP2 inhibitor** that binds and stabilizes SHP2 in its inactive conformation, targeting SHP2's critical role in RAS pathway signaling and cancer cell resistance to targeted therapies[161](index=161&type=chunk)[163](index=163&type=chunk)[164](index=164&type=chunk)[167](index=167&type=chunk) - Preclinical data show RLY-1971 potently inhibits SHP2 (**750 pM IC50**), induces tumor regression as monotherapy in KRASG12C mutant and EGFR amplified xenograft models, and retains nanomolar potency against activating SHP2 mutations[171](index=171&type=chunk)[172](index=172&type=chunk)[173](index=173&type=chunk)[175](index=175&type=chunk)[176](index=176&type=chunk)[178](index=178&type=chunk)[179](index=179&type=chunk)[180](index=180&type=chunk)[181](index=181&type=chunk)[182](index=182&type=chunk) - RLY-1971 demonstrates significant combination benefit with other targeted therapies (e.g., ALK inhibitors, KRASG12C inhibitors) by overcoming bypass resistance and is being evaluated in a Phase 1 clinical trial, with a combination trial with Genentech's GDC-6036 expected in **2021**[183](index=183&type=chunk)[184](index=184&type=chunk)[185](index=185&type=chunk)[186](index=186&type=chunk)[187](index=187&type=chunk)[189](index=189&type=chunk)[190](index=190&type=chunk)[191](index=191&type=chunk)[192](index=192&type=chunk)[194](index=194&type=chunk)[195](index=195&type=chunk) - RLY-1971 is estimated to address approximately **55,000 late-line patients annually** in the US in combination therapy settings, with potential for **90,000 patients** in earlier lines, including **15,000-25,000 KRAS G12C lung cancer patients**[162](index=162&type=chunk) [Discovery Programs](index=41&type=section&id=Discovery%20Programs) Relay Therapeutics is advancing three additional precision oncology and two monogenic disease programs, leveraging its Dynamo platform for previously intractable, genetically validated targets - Relay Therapeutics is advancing **three additional discovery-stage precision oncology programs** and **two monogenic disease programs**, leveraging its **Dynamo platform** to address high-value, genetically validated targets previously intractable to conventional drug discovery[196](index=196&type=chunk) [Competition](index=41&type=section&id=Competition) The biopharmaceutical industry is highly competitive, with Relay Therapeutics facing established companies and academic institutions across drug design, cancer, and genetic diseases, impacting market position and intellectual property - The biopharmaceutical industry is highly competitive, with Relay Therapeutics facing major pharmaceutical and biotechnology companies, academic institutions, and research organizations in structure-based drug design, cancer, and genetic diseases[197](index=197&type=chunk)[198](index=198&type=chunk)[400](index=400&type=chunk) - Key competitive factors include the richness of protein structural data, accuracy of computations, integration of experimental and computational capabilities, ability to transition to clinical development, capital raising, and platform scalability[199](index=199&type=chunk)[401](index=401&type=chunk) - Competitors may obtain regulatory approval faster, develop more effective/convenient/cost-effective drugs, or secure intellectual property rights that limit Relay's ability to commercialize its product candidates[202](index=202&type=chunk)[403](index=403&type=chunk) - Specific competitive landscapes exist for **RLY-4008** (non-selective FGFR inhibitors and other selective FGFR2 developers), **mutant-PI3Kα inhibitors** (approved non-selective PI3Kα inhibitors and other PI3Kα developers), and **RLY-1971** (other SHP2 inhibitors in clinical trials)[205](index=205&type=chunk)[207](index=207&type=chunk)[209](index=209&type=chunk)[210](index=210&type=chunk) [Our Collaborations](index=43&type=section&id=Our%20Collaborations) Relay Therapeutics maintains key scientific collaborations, including with D. E. Shaw Research for molecular dynamics simulations and Genentech for the development and commercialization of RLY-1971 - Relay Therapeutics maintains key scientific collaborations, including with **D. E. Shaw Research (DESRES Agreement)** for long timescale molecular dynamics simulations using the **Anton 2 supercomputer**, and with Google and University of Michigan for machine learning models[211](index=211&type=chunk)[212](index=212&type=chunk)[213](index=213&type=chunk) - The **DESRES Agreement**, extended to **August 2025**, involves collaborative research on Category 1 Targets, co-ownership of jointly developed IP (with Relay having assignment rights for certain compounds), and financial obligations including an annual fee (**$7.9 million**), development/regulatory milestones (**up to $7.25 million for first three products**), sales milestones (**up to $36.0 million**), and proceeds sharing from third-party transactions[214](index=214&type=chunk)[217](index=217&type=chunk)[218](index=218&type=chunk)[223](index=223&type=chunk)[224](index=224&type=chunk)[225](index=225&type=chunk) - The **Genentech Agreement (December 2020)** establishes a global collaboration for **RLY-1971's** development and commercialization, with Genentech responsible for subsequent clinical development and commercialization, while Relay retains rights to develop RLY-1971 in combination with its FGFR2 and PI3Kα programs[226](index=226&type=chunk)[227](index=227&type=chunk)[228](index=228&type=chunk)[229](index=229&type=chunk) Genentech Agreement Financial Terms | Payment Type | Amount (in millions USD) | | :----------- | :----------------------- | | Upfront Payment | $75 | | Near-term Payments | $25 | | Development, Commercialization, Sales-based Milestones (If Relay opts *out* of U.S. Profit/Cost Share) | Up to $695 | | Royalties (If Relay opts *out* of U.S. Profit/Cost Share) | Low-to-mid-teens % on worldwide net sales | | Development, Commercialization, Sales-based Milestones (If Relay opts *in* to U.S. Profit/Cost Share) | Up to $410 (outside U.S.) | | Royalties (If Relay opts *in* to U.S. Profit/Cost Share) | Low-to-mid-teens % on net sales outside U.S. | | Additional Royalties | Upon regulatory approval of RLY-1971 + GDC-6036 combination | [Intellectual Property](index=46&type=section&id=Intellectual%20Property) The company protects its intellectual property through patent applications for product candidates and methods, alongside trade secrets, subject to uncertainties in issuance, breadth, and enforcement - Relay Therapeutics protects its intellectual property through patent applications covering product candidates and methods, as well as reliance on trade secrets, know-how, and technological innovation[237](index=237&type=chunk)[239](index=239&type=chunk)[250](index=250&type=chunk) - Patent protection is subject to uncertainties regarding issuance, claim breadth, enforceability, and duration, with a typical **20-year term** from filing, potentially extended by up to **five years** under Hatch-Waxman Amendments[240](index=240&type=chunk)[241](index=241&type=chunk) - Specific IP for lead candidates includes co-owned applications for FGFR2 inhibitors (expiring **2040**) and PI3K program (expiring **2041**), and a wholly-owned U.S. patent for RLY-1971 (expiring **2039**), with Genentech having the first right to manage RLY-1971 related patents[242](index=242&type=chunk)[244](index=244&type=chunk)[245](index=245&type=chunk)[246](index=246&type=chunk)[247](index=247&type=chunk) - The company's trade secrets and know-how are protected by confidentiality and invention assignment agreements, but face risks of unauthorized disclosure or independent discovery by competitors[250](index=250&type=chunk) [Commercialization](index=49&type=section&id=Commercialization) Upon marketing approval, Relay Therapeutics plans to establish a focused U.S. sales and marketing team for oncologists and pursue third-party arrangements for international markets - Upon marketing approval, Relay Therapeutics plans to build a focused U.S. sales and marketing organization targeting oncologists and will pursue third-party distribution and marketing arrangements for international markets[251](index=251&type=chunk)[252](index=252&type=chunk) [Manufacturing](index=49&type=section&id=Manufacturing) Relay Therapeutics relies entirely on third-party contract manufacturing organizations for its small molecule product candidates and companion diagnostics for all stages of development and potential commercialization - Relay Therapeutics does not own or operate manufacturing facilities and relies entirely on third parties for the manufacture of its small molecule product candidates for preclinical, clinical, and potential commercial use[253](index=253&type=chunk)[254](index=254&type=chunk) - The company also expects to rely on third parties for the manufacture of companion diagnostics required for its products[256](index=256&type=chunk) [Governmental Regulation](index=50&type=section&id=Governmental%20Regulation) The company's product candidates are subject to extensive U.S. and international regulation, covering all stages from R&D to commercialization, with rigorous approval processes and post-approval obligations - The company's product candidates are subject to extensive regulation by the **FDA** in the U.S. and comparable foreign authorities, covering all stages from research and development to commercialization[257](index=257&type=chunk) - The U.S. drug approval process involves rigorous preclinical studies (GLP), IND submission, multi-phase clinical trials (GCP, IRB approval), NDA submission, FDA review (including manufacturing facility inspections for cGMP compliance), and potential post-approval obligations (Phase 4 trials, REMS)[259](index=259&type=chunk)[261](index=261&type=chunk)[262](index=262&type=chunk)[264](index=264&type=chunk)[265](index=265&type=chunk)[270](index=270&type=chunk)[271](index=271&type=chunk)[276](index=276&type=chunk)[278](index=278&type=chunk)[290](index=290&type=chunk)[291](index=291&type=chunk) - Expedited development and review programs (**Fast Track, Breakthrough Therapy, Priority Review, Accelerated Approval, Orphan Drug Designation**) are available for serious/life-threatening conditions, offering incentives like market exclusivity (**7 years in US, 10 years in EU for orphan drugs**) and accelerated review timelines[279](index=279&type=chunk)[280](index=280&type=chunk)[281](index=281&type=chunk)[282](index=282&type=chunk)[283](index=283&type=chunk)[284](index=284&type=chunk)[286](index=286&type=chunk)[334](index=334&type=chunk)[335](index=335&type=chunk) - Companion diagnostics are regulated as medical devices by the FDA, requiring separate marketing clearance or approval (**510(k)** or **PMA**) and often developed contemporaneously with the therapeutic product[294](index=294&type=chunk)[295](index=295&type=chunk)[297](index=297&type=chunk)[298](index=298&type=chunk) - The company's operations are also subject to various healthcare laws and regulations, including anti-kickback, false claims, physician transparency (**Sunshine Act**), and patient data privacy (**HIPAA, GDPR**), with non-compliance potentially leading to significant penalties[301](index=301&type=chunk)[303](index=303&type=chunk)[304](index=304&type=chunk)[307](index=307&type=chunk)[340](index=340&type=chunk) - Insurance coverage and adequate reimbursement from third-party payors (e.g., Medicare, Medicaid) are critical for product commercialization, and healthcare reform legislation (e.g., **ACA, CARES Act**, drug pricing initiatives) can significantly impact pricing and market access[306](index=306&type=chunk)[309](index=309&type=chunk)[311](index=311&type=chunk)[312](index=312&type=chunk)[313](index=313&type=chunk)[314](index=314&type=chunk)[315](index=315&type=chunk)[316](index=316&type=chunk)[318](index=318&type=chunk) [Human Capital Resources](index=67&type=section&id=Human%20Capital%20Resources) As of February 2021, Relay Therapeutics had 159 employees, primarily in R&D, focusing on attracting and retaining talent through competitive compensation and an inclusive work environment - As of **February 28, 2021**, Relay Therapeutics had **159 full-time employees**, with **74 holding M.D. or Ph.D. degrees**, primarily engaged in research and development (**114 employees**)[344](index=344&type=chunk) - The company focuses on attracting and retaining talent through competitive compensation, employee development programs, and fostering an inclusive and collaborative work environment, including a diversity and inclusion advisory group[345](index=345&type=chunk)[346](index=346&type=chunk)[347](index=347&type=chunk) - In response to the **COVID-19 pandemic**, the company implemented safety protocols, regular onsite testing, and remote work arrangements to ensure employee health and business continuity[348](index=348&type=chunk) [Corporate Information](index=67&type=section&id=Corporate%20Information) Relay Therapeutics, incorporated in Delaware in 2015, completed its IPO in July 2020 and operates as an "emerging growth company" and "smaller reporting company" with reduced disclosure requirements - Relay Therapeutics was incorporated in Delaware on **May 4, 2015**, and completed its initial public offering (IPO) in **July 2020**, raising **$425 million** in net proceeds[349](index=349&type=chunk)[350](index=350&type=chunk) - The company operates as an "**emerging growth company**" and "**smaller reporting company**," allowing it to avail itself of reduced disclosure requirements under the JOBS Act and Exchange Act[351](index=351&type=chunk)[352](index=352&type=chunk) [Available Information](index=68&type=section&id=Available%20Information) The company's public filings, including Annual Reports on Form 10-K, are accessible free of charge on its website and through the SEC's EDGAR system - The company's Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other filings are available free of charge on its website (**www.relaytx.com**) and through the SEC's EDGAR system (**www.sec.gov**)[353](index=353&type=chunk) [Risk Factors](index=69&type=section&id=Item%201A.%20Risk%20Factors) Investing in Relay Therapeutics' common stock involves a high degree of risk due to the inherent uncertainties of biopharmaceutical development, including potential failures in clinical trials, regulatory hurdles, intense competition, reliance on third parties, significant operating losses, and the impact of global economic conditions and evolving healthcare regulations [Risks Related to Our Product Candidates](index=69&type=section&id=Risks%20Related%20to%20Our%20Product%20Candidates) The company faces significant risks that its product candidates may not prove effective or safe in humans, encounter development delays, or fail to achieve regulatory approval - The company has never successfully completed any clinical trials, and there is no assurance that its current (**RLY-1971, RLY-4008**) or future product candidates will prove effective and safe in humans or receive regulatory approval[357](index=357&type=chunk)[358](index=358&type=chunk)[360](index=360&type=chunk) - Development may incur additional costs or delays due to unforeseen events in clinical trials, difficulties in patient enrollment (e.g., due to specific eligibility criteria, competition, or the **COVID-19 pandemic**), or the inability to replicate positive preclinical results in later studies[362](index=362&type=chunk)[363](index=363&type=chunk)[364](index=364&type=chunk)[366](index=366&type=chunk)[367](index=367&type=chunk)[368](index=368&type=chunk)[370](index=370&type=chunk)[371](index=371&type=chunk)[372](index=372&type=chunk) - Clinical trials may reveal significant adverse events not seen in preclinical studies, potentially inhibiting regulatory approval or market acceptance, and the use of novel mechanisms of action may lead to greater R&D expenses, regulatory issues, or unanticipated side effects[373](index=373&type=chunk)[375](index=375&type=chunk)[385](index=385&type=chunk)[386](index=386&type=chunk) - The company may fail to identify viable new product candidates for clinical development, and developing candidates in combination with other therapies exposes it to additional risks related to the approval, safety, or supply of those combination agents[377](index=377&type=chunk)[379](index=379&type=chunk)[380](index=380&type=chunk)[383](index=383&type=chunk)[384](index=384&type=chunk) [Risks Related to Obtaining Regulatory Approvals](index=75&type=section&id=Risks%20Related%20to%20Obtaining%20Regulatory%20Approvals) Obtaining regulatory approvals is an expensive, lengthy, and uncertain process, with no guarantee of marketing approval or favorable terms, potentially limiting commercial potential - Obtaining regulatory approvals is an expensive, lengthy, and uncertain process, with no guarantee that product candidates will ever receive marketing approval due to potential disagreements with regulatory authorities on trial design, insufficient data, or manufacturing issues[389](index=389&type=chunk)[390](index=390&type=chunk) - Approval, if obtained, may be for fewer or more limited indications, or contingent on costly post-marketing studies, which could narrow commercial potential and materially impair revenue generation[392](index=392&type=chunk)[393](index=393&type=chunk) [Risks Related to Commercialization](index=76&type=section&id=Risks%20Related%20to%20Commercialization) The company faces substantial competition, uncertain market opportunities, and challenges in obtaining adequate insurance coverage and reimbursement, which could significantly limit product commercialization and revenue - The estimated market opportunities for product candidates (**RLY-1971, RLY-4008, RLY-PI3K1047**) are based on estimates and may be smaller than anticipated, adversely affecting revenue and profitability[394](index=394&type=chunk)[395](index=395&type=chunk)[398](index=398&type=chunk) - The company faces substantial competition from major pharmaceutical and biotechnology companies with greater resources, who may develop superior products or obtain regulatory approval more rapidly, impacting Relay's market position[400](index=400&type=chunk)[401](index=401&type=chunk)[402](index=402&type=chunk)[403](index=403&type=chunk) - Failure to obtain or maintain adequate insurance coverage and reimbursement from governmental and commercial payors for any approved product candidates could limit market access and decrease revenue generation[405](index=405&type=chunk)[406](index=406&type=chunk)[407](index=407&type=chunk)[408](index=408&type=chunk) - Foreign countries may impose price controls or reimbursement limitations, potentially leading to significantly lower prices for products launched in the European Union compared to the U.S[409](index=409&type=chunk)[410](index=410&type=chunk) [Risks Related to Our Reliance on Third Parties](index=79&type=section&id=Risks%20Related%20to%20Our%20Reliance%20on%20Third%20Parties) The company's critical reliance on third-party collaborators, CROs, CMOs, and single-source suppliers for development and manufacturing exposes it to significant risks of delays, disruptions, and performance failures - The company's collaboration with **D. E. Shaw Research (DESRES Agreement)** for protein modeling and access to the **Anton 2 supercomputer** is critical; its termination or reduction could materially harm the business and development efforts[411](index=411&type=chunk)[412](index=412&type=chunk) - Reliance on third parties (CROs, investigators) for clinical trials and CMOs for manufacturing increases risks of non-compliance, performance failures, delays, and supply disruptions, which could impede regulatory approval and commercialization[418](index=418&type=chunk)[420](index=420&type=chunk)[421](index=421&type=chunk)[423](index=423&type=chunk)[425](index=425&type=chunk)[426](index=426&type=chunk)[428](index=428&type=chunk)[429](index=429&type=chunk)[432](index=432&type=chunk) - Single-source suppliers for active pharmaceutical ingredients (API) pose a significant risk, as loss of a supplier or inability to meet demand could delay development efforts[433](index=433&type=chunk)[434](index=434&type=chunk)[435](index=435&type=chunk) - Collaborations with third parties (e.g., **Genentech Agreement**) involve risks such as limited control over resources, non-performance, unsuccessful trials, and potential termination, which could delay product development and impact revenue[436](index=436&type=chunk)[437](index=437&type=chunk)[438](index=438&type=chunk)[439](index=439&type=chunk) [Risks Related to Our Financial Position and Ability to Raise Additional Capital](index=85&type=section&id=Risks%20Related%20to%20Our%20Financial%20Position%20and%20Ability%20to%20Raise%20Additional%20Capital) Relay Therapeutics has incurred significant operating losses and will require substantial additional funding to support its capital-intensive development, with uncertainty regarding the availability and terms of future capital - As a biopharmaceutical company with a limited operating history since **May 2015**, Relay Therapeutics has incurred significant net losses (**$52.4 million in 2020**, **$75.3 million in 2019**) and had an accumulated deficit of **$404.2 million** as of **December 31, 2020**[445](index=445&type=chunk)[639](index=639&type=chunk) - The company anticipates continued significant operating losses for the foreseeable future due to increasing research and development expenses, clinical trial costs, and public company operating costs[447](index=447&type=chunk)[639](index=639&type=chunk)[640](index=640&type=chunk) - Substantial additional funding will be required to support ongoing operations, clinical development, and potential commercialization efforts, as the company has no products approved for commercial sale and has not generated revenue from product sales[450](index=450&type=chunk)[452](index=452&type=chunk)[642](index=642&type=chunk) - The ability to raise additional capital on acceptable terms is uncertain, and failure to do so could force delays, reductions, or elimination of product development programs, or require relinquishing rights to technologies or product candidates, leading to dilution for existing stockholders[452](index=452&type=chunk)[455](index=455&type=chunk)[457](index=457&type=chunk)[458](index=458&type=chunk)[459](index=459&type=chunk)[460](index=460&type=chunk) - Existing cash, cash equivalents, and investments (**$678.1 million** as of **December 31, 2020**), combined with a **$75.0 million** upfront payment from Genentech (received **January 2021**), are expected to fund operations into **2024**, but this estimate is based on assumptions that may prove incorrect[644](index=644&type=chunk)[675](index=675&type=chunk) [Risks Related to COVID-19 and the Global Economy](index=90&type=section&id=Risks%20Related%20to%20COVID-19%20and%20the%20Global%20Economy) The COVID-19 pandemic poses significant risks to clinical trial timelines, third-party operations, and overall business continuity, potentially impacting capital raising and financial results - The **COVID-19 pandemic** poses significant risks, including potential delays in preclinical studies and clinical trials (e.g., patient enrollment, site staff availability), disruptions to third-party partners (manufacturers, suppliers), and interruptions to business operations due to quarantines and travel restrictions[462](index=462&type=chunk)[463](index=463&type=chunk)[464](index=464&type=chunk) - The company's target patient populations may be particularly susceptible to COVID-19, complicating clinical trial enrollment, and the pandemic's broader economic impact could affect capital raising and financial results[462](index=462&type=chunk)[466](index=466&type=chunk)[467](index=467&type=chunk) [Risks Related to Our Intellectual Property](index=91&type=section&id=Risks%20Related%20to%20Our%20Intellectual%20Property) The company's commercial success depends on robust patent protection, which is subject to uncertainties in issuance, scope, and enforcement, alongside risks of infringement claims and trade secret vulnerabilities - The company's commercial success depends on its ability to obtain and maintain broad patent protection for its product candidates and technology, but there is no assurance that pending patent applications will issue or provide sufficient scope, and patents have a limited lifespan[468](index=468&type=chunk)[474](index=474&type=chunk) - Reliance on licensed patent rights (e.g., to Genentech for SHP2 program) means limited control over patent prosecution and enforcement, and co-owned intellectual property with **D. E. Shaw Research (DESRES Agreement)** may lead to disputes over ownership or control[469](index=469&type=chunk)[471](index=471&type=chunk)[472](index=472&type=chunk)[473](index=473&type=chunk)[475](index=475&type=chunk)[507](index=507&type=chunk)[508](index=508&type=chunk)[509](index=509&type=chunk) - The company faces risks of third parties alleging infringement of their intellectual property rights, leading to costly and time-consuming litigation, potential monetary damages, or the need to obtain licenses on unfavorable terms[489](index=489&type=chunk)[490](index=490&type=chunk)[495](index=495&type=chunk)[496](index=496&type=chunk) - Protection of unpatented trade secrets and know-how is challenging, as they are vulnerable to unauthorized disclosure, independent discovery, or misuse, which could harm the company's competitive position[486](index=486&type=chunk)[487](index=487&type=chunk) - Changes in patent law (e.g., **Leahy-Smith America Invents Act**) and varying intellectual property protection in foreign jurisdictions could diminish the value of patents and impair the ability to enforce rights globally[498](index=498&type=chunk)[499](index=499&type=chunk)[510](index=510&type=chunk)[511](index=511&type=chunk) [Risks Related to Government Regulation](index=100&type=section&id=Risks%20Related%20to%20Government%20Regulation) Even with regulatory approval, the company faces extensive post-approval obligations, strict promotion rules, varying international requirements, and evolving healthcare laws that could impact profitability and market access - Even if product candidates receive regulatory approval, the company will be subject to extensive and ongoing post-approval obligations, including manufacturing processes, labeling, adverse event reporting, and compliance with cGMPs and GCPs, with non-compliance potentially leading to significant penalties or market withdrawal[515](index=515&type=chunk)[516](index=516&type=chunk)[518](index=518&type=chunk)[519](index=519&type=chunk) - Strict regulations prohibit the promotion of off-label uses, and improper promotion could lead to significant liability, fines, and enforcement actions[520](index=520&type=chunk) - Obtaining regulatory approval in one jurisdiction does not guarantee approval in others, and foreign regulatory processes can be lengthy, costly, and involve different requirements[522](index=522&type=chunk)[523](index=523&type=chunk) - The company's relationships with customers and third-party payors will be subject to applicable anti-kickback, fraud and abuse, and other healthcare laws and regulations (e.g., federal **Anti-Kickback Statute, False Claims Act, HIPAA, Sunshine Act**), with potential for criminal sanctions, civil penalties, and exclusion from government healthcare programs for violations[533](index=533&type=chunk)[534](index=534&type=chunk)[535](index=535&type=chunk)[536](index=536&type=chunk) - Healthcare legislative reform measures (e.g., **ACA, CARES Act**, drug pricing initiatives like the **Most Favored Nation Model** and drug reimportation) in the U.S. and abroad may significantly impact healthcare spending, reimbursement, and the profitability of approved products[548](index=548&type=chunk)[549](index=549&type=chunk)[550](index=550&type=chunk)[551](index=551&type=chunk)[552](index=552&type=chunk)[553](index=553&type=chunk)[554](index=554&type=chunk)[555](index=555&type=chunk)[556](index=556&type=chunk)[557](index=557&type=chunk)[559](index=559&type=chunk)[560](index=560&type=chunk)[561](index=561&type=chunk)[562](index=562&type=chunk)[564](index=564&type=chunk) [Risks Related to Regulatory Agency Review Process](index=111&type=section&id=Risks%20Related%20to%20Regulatory%20Agency%20Review%20Process) Disruptions at regulatory agencies due to budget issues, global health concerns, or personnel shortages could hinder timely product review and approval, adversely affecting the company's business - Disruptions at regulatory agencies (e.g., **FDA, SEC**) due to government budget issues, global health concerns (like **COVID-19**), or personnel shortages could hinder their ability to review and approve new products in a timely manner, adversely affecting the company's business[567](index=567&type=chunk)[568](index=568&type=chunk) [Risks Related to Employee Matters and Managing Growth](index=111&type=section&id=Risks%20Related%20to%20Employee%20Matters%20and%20Managing%20Growth) The company's success depends on attracting and retaining key talent, managing rapid growth, and mitigating risks of employee misconduct, all of which could disrupt business plans - The company's future success is highly dependent on its ability to attract, retain, and motivate key executives, experienced scientists, and qualified personnel in a competitive hiring environment, particularly in Cambridge, Massachusetts[569](index=569&type=chunk)[571](index=571&type=chunk)[572](index=572&type=chunk) - The company is exposed to the risk of misconduct or other improper activities by employees, principal investigators, CROs, and consultants, including non-compliance with regulatory standards or insider trading, which could lead to significant sanctions and reputational harm[573](index=573&type=chunk) - Expected significant growth in employees and operations (as a public company and in product development/commercialization) may lead to difficulties in managing expansion, implementing systems, and recruiting/training personnel, potentially disrupting business plans[574](index=574&type=chunk)[575](index=575&type=chunk) [Risks Related to Business Disruptions](index=113&type=section&id=Risks%20Related%20to%20Business%20Disruptions) The company's operations are vulnerable to computer system failures, cyber-attacks, environmental non-compliance, and natural disasters, which could disrupt development, compromise data, and incur significant costs - The company's business and operations are vulnerable to computer system failures, cyber-attacks, and deficiencies in cybersecurity, which could disrupt development programs, compromise data, and incur liability, especially with increased remote work due to **COVID-19**[577](index=577&type=chunk) - Failure to comply with environmental, health, and safety laws and regulations related to hazardous materials could result in fines, penalties, or significant costs[578](index=578&type=chunk)[579](index=579&type=chunk) - Operations are concentrated in Massachusetts, making the company vulnerable to natural disasters (e.g., floods, fires, earthquakes, epidemics) and other unplanned events that could disrupt facilities, manufacturing, and business continuity[581](index=581&type=chunk) [Risks Related to Our Common Stock](index=114&type=section&id=Risks%20Related%20to%20Our%20Common%20Stock) As an "emerging growth company," Relay Therapeutics' common stock may experience high volatility and be less attractive to investors, while significant insider control could limit other stockholders' influence - As an "**emerging growth company**" and "**smaller reporting company**," Relay Therapeutics may avail itself of reduced disclosure requirements, which could make its common stock less attractive to investors and adversely affect its market price and volatility[582](index=582&type=chunk)[583](index=583&type=chunk)[584](index=584&type=chunk)[585](index=585&type=chunk)[586](index=586&type=chunk) - The trading price of the common stock is likely to be highly volatile, influenced by factors such as clinical trial results, regulatory developments, competitive products, and general market conditions, potentially leading to securities class action litigation[587](index=587&type=chunk)[590](index=590&type=chunk)[591](index=591&type=chunk) - Executive officers, directors, principal stockholders, and their affiliates (e.g., SoftBank Vision Fund, Third Rock Ventures, FMR LLC) collectively exercise significant control (**~49.6%** as of **March 15, 2021**) over the company, which could limit other stockholders' ability to influence corporate matters or delay/prevent a change in corporate control[592](index=592&type=chunk)[595](index=595&type=chunk) [Risks Related to Tax](index=116&type=section&id=Risks%20Related%20to%20Tax) The company's ability to utilize its net operating loss carryforwards may be limited by ownership changes, and evolving tax laws could adversely affect its financial condition - The company's ability to utilize its federal net operating loss (NOL) carryforwards (**$174.0 million** as of **December 31, 2020**) and state NOL carryforwards (**$192.3 million**) may be substantially limited by "ownership changes" under Section 382 of the Internal Revenue Code[593](index=593&type=chunk) - Changes to tax laws, such as the **Tax Cuts and Jobs Act of 2017** and the **Coronavirus Aid, Relief, and Economic Security Act (CARES Act) of 2020**, or new interpretations thereof, could adversely affect the company's business and financial condition[596](index=596&type=chunk)[597](index=597&type=chunk)[598](index=598&type=chunk) [Risks Related to Dividends](index=117&type=section&id=Risks%20Related%20to%20Dividends) The company has never paid cash dividends and intends to retain all future earnings for business growth, meaning capital appreciation will be the sole source of stockholder gain - The company has never declared or paid cash dividends and currently intends to retain all future earnings for business growth, meaning capital appreciation will be the sole source of gain for stockholders in the foreseeable future[599](index=599&type=chunk) [Risks Related to Operating as a Public Company](index=117&type=section&id=Risks%20Related%20to%20Operating%20as%20a%20Public%20Company) Operating as a public company incurs significant legal, accounting, and compliance expenses, requiring substantial management time and facing inherent limitations in disclosure controls - Operating as a public company incurs significant legal, accounting, and other expenses, requiring substantial management time for compliance initiatives, particularly with the **Sarbanes-Oxley Act of 2002 (Section 404)** regarding internal control over financial reporting[600](index=600&type=chunk)[601](index=601&type=chunk) - Disclosure controls and procedures, while designed to provide reasonable assurance, have inherent limitations, meaning errors or fraud may occur and not be detected[603](index=603&type=chunk) [Risks Related to Our Charter and Bylaws](index=118&type=section&id=Risks%20Related%20to%20Our%20Charter%20and%20Bylaws) Anti-takeover provisions in the company's charter and bylaws, along with exclusive forum provisions, could delay or prevent a change of control and limit stockholders' judicial choices - Anti-takeover provisions in the company's charter documents (e.g., staggered board, prohibition on written consent, advance notice requirements) and under Delaware law (**Section 203**) could delay or prevent a change of control or limit stockholders' ability to influence corporate matters[604](index=604&type=chunk)[605](index=605&type=chunk)[606](index=606&type=chunk) - Exclusive forum provisions in the bylaws designate specific courts (Delaware Court of Chancery for state law, U.S. District Court for District of Massachusetts for Securities Act claims), potentially limiting stockholders' choice of judicial forum and increasing litigation costs[607](index=607&type=chunk)[608](index=608&type=chunk) [Risks Related to Market Analysts](index=119&type=section&id=Risks%20Related%20to%20Market%20Analysts) The trading market for the company's common stock relies on analyst reports; negative evaluations or cessation of coverage could cause the stock price to decline - The trading market for the company's common stock relies on research and reports from industry or financial analysts; negative evaluations or cessation of coverage could cause the stock price to decline[609](index=609&type=chunk)[610](index=610&type=chunk) [Unresolved Staff Comments](index=120&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) There are no unresolved staff comments to report - No unresolved staff comments[612](index=612&type=chunk) [Properties](index=120&type=section&id=Item%202.%20Properties) Relay Therapeutics' corporate headquarters is located in Cambridge, Massachusetts, where it leases approximately 46,631 square feet of office and laboratory space under a lease expiring April 30, 2029, with an option to extend - The company's corporate headquarters is in Cambridge, Massachusetts, leasing approximately **46,631 square feet** of office and laboratory space[613](index=613&type=chunk) - The current lease term expires on **April 30, 2029**, with a **five-year extension option**[613](index=613&type=chunk) - Existing facilities are considered sufficient for foreseeable needs, with additional space expected to be available on commercially reasonable terms if needed[614](index=614&type=chunk) [Legal Proceedings](index=120&type=section&id=Item%203.%20Legal%20Proceedings) Relay Therapeutics is not currently a party to any litigation or legal proceedings that management believes would have a material adverse effect on its business - The company is not currently a party to any litigation or legal proceedings deemed to have a material adverse effect on its business[615](index=615&type=chunk) - Litigation, even if successfully defended, can adversely impact the business due to defense and settlement costs, and diversion of management resources[615](index=615&type=chunk) [Mine Safety Disclosures](index=120&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Relay Therapeutics - Not applicable[616](index=616&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=121&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Relay Therapeutics' common stock began trading on the NASDAQ Global Market under the symbol "RLAY" on July 16, 2020, following its initial public offering, with approximately 61 holders of record as of February 26, 2021, and no cash dividends declared to date - The company's common stock began trading on the **NASDAQ Global Market** under the symbol "**RLAY**" on **July 16, 2020**, with no prior public market[619](index=619&type=chunk) - As of **February 26, 2021**, there were approximately **61 holders of record** of the company's common stock[620](index=620&type=chunk) - The company has never declared or paid cash dividends and intends to retain all available funds and future earnings for business growth, with any future dividend decisions at the discretion of the board of directors[621](index=621&type=chunk) - From **January 1, 2020**, to the IPO closing on **July 20, 2020**, the company granted options to purchase **2,492,458 common shares** and issued **280,548 common shares** upon option exercise for **$1.1 million** gross proceeds, exempt from registration under Section 4(a)(2) or Rule 701 of the Securities Act[624](index=624&type=chunk)[625](index=625&type=chunk) - The company did not purchase any of its registered equity securities during the period covered by this Annual Report on Form 10-K[628](index=628&type=chunk) [Reserved](index=122&type=section&id=Item%206.%20Reserved) This item is reserved and contains no information - This item is reserved[629](index=629&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=123&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides an analysis of the company's financial condition, results of operations, liquidity, capital resources, market risk, and internal controls, alongside information on its common stock market [Overview](index=123&type=section&id=Overview) Relay Therapeutics, a clinical-stage precision medicines company, incurred significant operating losses in 2020 and 2019, with its IPO and Genentech collaboration providing crucial funding for ongoing R&D - Relay Therapeutics is a clinical-stage precision medicines company focused on targeted oncology, leveraging its **Dynamo platform** to advance product candidates **RLY-1971, RLY-4008**, and the **RLY-PI3K1047 program**[631](index=631&type=chunk)[632](index=632&type=chunk) - The company completed its IPO on **July 20, 2020**, raising **$425.3 million** in net proceeds, and received a **$75.0 million** upfront payment in **January 2021** from the **Genentech Agreement** for RLY-1971[634](index=634&type=chunk)[635](index=635&type=chunk) - Relay Therapeutics has incurred significant operating losses since inception, with net losses of **$52.4 million in 2020** and **$75.3 million in 2019**, resulting in an accumulated deficit of **$404.2 million** as of **December 31, 2020**[639](index=639&type=chunk) - The company anticipates continued significant operating losses due to increasing research and development expenses, clinical trial costs, and public company operations, necessitating additional financing beyond its current cash runway (expected into **2024**)[639](index=639&type=chunk)[640](index=640&type=chunk)[642](index=642&type=chunk)[644](index=644&type=chunk) - The **COVID-19 pandemic** may directly or indirectly impact clinical trial timelines and overall business operations, though current clinical enrollment for RLY-1971 and RLY-4008 continues[637](index=637&type=chunk)[638](index=638&type=chunk) [Components of our Results of Operations](index=125&type=section&id=Components%20of%20our%20Results%20of%20Operations) Revenue primarily stems from the Genentech Agreement, while operating expenses, mainly R&D and G&A, are expected to increase significantly, with no U.S. federal or state income tax benefits recorded - Revenue for the year ended **December 31, 2020**, consisted solely of amounts related to the **Genentech Agreement**, recognized as performance obligations are satisfied[645](index=645&type=chunk) - Operating expenses are primarily comprised of research and development (R&D) costs and general and administrative (G&A) costs, both expected to increase significantly in the future[646](index=646&type=chunk)[653](index=653&type=chunk)[656](index=656&type=chunk) - R&D expenses include employee-related costs, outside consultants, CRO/CMO expenses, clinical trial materials, regulatory compliance, and facility costs, with external development costs tracked by program for clinical and preclinical stages[647](index=647&type=chunk)[648](index=648&type=chunk)[649](index=649&type=chunk)[650](index=650&type=chunk) Research and Development Expenses by Category (2020) | Category | Amount (in thousands USD) | | :--------------------------------------- | :-------------------- | | External costs for programs in clinical trials | $7,447 | | External costs for programs in discovery and pre-clinical studies | $42,431 | | External costs for platform research and other R&D activities | $11,544 | | Employee related expenses | $38,440 | | **Total research and development expenses** | **$99,862** | - G&A expenses include salaries, stock-based compensation for administrative functions, legal fees, professional fees, insurance, and facility-related expenses, expected to rise with organizational growth and public company operations[655](index=655&type=chunk)[656](index=656&type=chunk) - The company has not recorded U.S. federal or state income tax benefits due to net losses and uncertainty of realizing benefits from its federal (**$174.0 million**) and state (**$192.3 million**) NOL carryforwards and R&D tax credits (**$8.1 million federal, $2.7 million state**)[658](index=658&type=chunk)[659](index=659&type=chunk) [Results of Operations](index=128&type=section&id=Results%20of%20Operations) In 2020, revenue significantly increased due to the Genentech Agreement, while R&D and G&A expenses also rose, leading to a reduced net loss compared to 2019 Consolidated Statements of Operations Summary (2020 vs. 2019) | Metric | Year Ended December 31, 2020 (in thousands USD) | Year Ended December 31, 2019 (in thousands USD) | Change (in thousands USD) | | :---------------------- | :---------------------------------------- | :---------------------------------------- | :-------------------- | | Revenue | $82,654 | $0 | $82,654 | | Research and development expenses | $99,862 | $70,306 | $29,556 | | General and administrative expenses | $38,588 | $13,742 | $24,846 | | Total operating expenses | $138,450 | $84,048 | $54,402 | | Loss from operations | $(55,796) | $(84,048) | $28,252 | | Interest income and other expense | $3,384 | $8,743 | $(5,359) | | Net loss | $(52,412) | $(75,305) | $22,893 | - Revenue increased significantly to **$82.7 million in 2020** (from **$0 in 2019**) due to the **Genentech Agreement's** license transfer[662](index=662&type=chunk) - Research and development expenses increased by **$29.6 million in 2020**, primarily driven by **$18.5 million** in employee-related costs (including **$12.0 million** in stock-based compensation) and **$11.4 million** in outside/consulting services for clinical and preclinical candidates[663](index=663&type=chunk) - General and administrative expenses increased by **$24.8 million in 2020**, mainly due to **$19.2 million** in employee-related costs (including **$15.5 million** in stock-based compensation) and **$5.2 million** in other G&A expenses (insurance, legal)[664](index=664&type=chunk) - Other income, net, decreased by **$5.4 million in 2020**, primarily due to lower interest rates and investment amounts[666](index=666&type=chunk) [Liquidity and Capital Resources](index=129&type=section&id=Liquidity%20and%20Capital%20Resources) The company has financed operations through private placements, debt, and its 2020 IPO, with current cash and the Genentech payment expected to fund operations into 2024, though substantial future capital is required - Since inception, the company has financed operations through private placements, convertible debt, and its **July 2020 IPO** (**$425.3 million** net proceeds), supplemented by a **$75.0 million** upfront payment from Genentech received in **January 2021**[667](index=667&type=chunk) - As of **December 31, 2020**, cash, cash equivalents, and investments totaled **$678.1 million**, which, combined with the Genentech payment, are expected to fund operating expenses and capital expenditure requirements into **2024**[667](index=667&type=chunk)[675](index=675&type=chunk) Cash Flow Summary (2020 vs. 2019) | Cash Flow Activity | Year Ended December 31, 2020 (in thousands USD) | Year Ended December 31, 2019 (in thousands USD) | | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | | Cash used in operating activities | $(102,489) | $(66,133) | | Cash provided by (used in) investing activities | $81,672 | $(319,024) | | Cash provided by financing activities | $426,509 | $5,606 | | **Net increase (decrease) in cash, cash equivalents and restricted cash** | **$405,692** | **$(379,551)** | - Operating activities used **$102.5 million in 2020**, primarily due to net loss and increases in accounts receivable and contract assets related to the **Genentech Agreement**[669](index=669&type=chunk) - The company anticipates substantial future capital requirements due to ongoing R&D, clinical trials, potential commercialization, and public company costs, and will need to obtain additional funds through equity, debt, or collaborations, which may not be available on acceptable terms[674](index=674&type=chunk)[676](index=676&type=chunk)[678](index=678&type=chunk)[679](index=679&type=chunk)[680](index=680&type=chunk)[681](index=681&type=chunk) [Contractual Obligations and Commitments](index=131&type=section&id=Contractual%20Obligations%20and%20Commitments) Key contractual obligations include an annual fee and potential milestones under the DESRES Agreement, other research arrangements, and a facility lease expiring in April 2029 - The **Amended and Restated Collaboration and License Agreement with D. E. Shaw Research (DESRES Agreement)** extends to **August 16, 2025**, with an annual fee of **$7.9 million** (commencing **August 16, 2020**), potential development/regulatory milestones (**up to $7.3 million per target**), sales milestones, and royalties[682](index=682&type=chunk)[684](index=684&type=chunk)[685](index=685&type=chunk) - As of **December 31, 2020**, **$1.5 million** was accrued to D. E. Shaw Research related to the **Genentech Agreement**[684](index=684&type=chunk) - Other research and license arrangements include potential development milestone payments of **$4.0 million to $7.0 million** for up to **four targets**[686](index=686&type=chunk) - The company has a facility lease agreement for its Cambridge, MA office and laboratory space, expiring in **April 2029**, with a letter of credit of **$878 thousand**[688](index=688&type=chunk)[689](index=689&type=chunk) Minimum Lease Payments (as of December 31, 2020) | Year Ending December 31, | Amount (in thousands USD) | | :----------------------- | :------------------------ | | 2021 | $3,985 | | 2022 | $4,134 | | 2023 | $4,254 | | 2024 | $4,377 | | 2025 | $4,503 | | Thereafter | $15,959 | | **Total lease payments** | **$37,212** | [Critical Accounting Policies and Use of Estimates](index=132&type=section&id=Critical%20Accounting%20Policies%20and%20Use%20of%20Estimates) Financial statement preparation involves significant management estimates for revenue recognition, accrued R&D expenses, and stock-based compensation, with the company utilizing extended transition periods for new accounting standards - The preparation of financial statements requires significant management estimates and assumptions, particularly for revenue recognition (**ASC 606**), accrued research and development expenses, and stock-based compensation[690](index=690&type=chunk)[693](index=693&type=chunk)[694](index=694&type=chunk)[700](index=700&type=chunk)[701](index=701&type=chunk) - Revenue recognition under **ASC 606** involves a five-step process requiring significant judgment in identifying performance obligations, determining transaction price (including variable consideration like milestones), and allocating price based on stand-alone selling prices[694](index=694&type=chunk)[695](index=695&type=chunk)[696](index=696&type=chunk)[697](index=697&type=chunk) -

Company Presentation January 2021 Confidential | © 2021 Relay Therapeutics 1 Disclaimer 2 This presentation contains forward-looking statements and information about our current and future prospects and our operations and financial results, which are based on currently available information. All statements other than statements of historical facts contained in this presentation, including statements regarding our strategy, future financial condition, future operations, projected costs, prospects, plans, obj ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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 September 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: 001-39385 RELAY THERAPEUTICS, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 47-3923475 ( ...