UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 _____________________________________ FORM 10-Q _____________________________________ (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2025 OR o 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: 001-40693 RALLYBIO CORP ...

Exhibit 99.1 Corporate Updates • In the third quarter of 2025, Rallybio generated a total of $20 million pursuant to its agreement with Recursion Pharmaceuticals for the sale of its interest in REV102, an investigational ENPP1 inhibitor in development for the treatment of hypophosphatasia (HPP). The total included $7.5 million from an upfront payment and $12.5 million related to the initiation of additional preclinical studies. RLYB116 Program Rallybio Reports Third Quarter 2025 Financial Results and Provid ...

Group 1: Reviva Pharmaceuticals Holdings Inc. (RVPH) - RVPH experienced a significant after-hours rally, increasing 18.27% to $0.58 after a 35.1% surge during regular trading, with a trading volume of over 40.5 million shares, nearly nine times its daily average [2][3] - The company has a market cap of $47 million and is focused on its lead candidate brilaroxazine, which targets neuropsychiatric and respiratory conditions [3] Group 2: Penumbra Inc. (PEN) - PEN surged 7.97% in after-hours trading to $273.69, following a 1.55% gain during the regular session, with a market cap nearing $9.9 billion [4][5] - The company has increased its revenue guidance for FY25 to a range of $1.355 billion - $1.370 billion, indicating a growth of 13% to 15% over 2024 [6] Group 3: Palisade Bio Inc. (PALI) - PALI jumped 10% in after-hours trading to $1.87, extending a 29.8% surge during the regular session, driven by a $138 million public offering [7][8] - The company has a market cap of $15.8 million and is gaining attention due to recent clinical updates and licensing agreements [8] Group 4: IO Biotech Inc. (IOBT) - IOBT rose 5.08% in after-hours trading to $0.4571, following a 22.3% surge during the regular session, with heavy trading volume of 16.7 million shares [9] - The company announced plans to design a new registrational study for its cancer vaccine candidate Cylembio after receiving regulatory feedback from the FDA [10] Group 5: Rallybio Corp. (RLYB) - RLYB increased 11.2% in after-hours trading to $0.5688, reversing a modest dip during the regular session, with a market cap of $21.4 million [11][12] - The company recently completed dosing in its Phase 1 study for RLYB116 and received a $12.5 million milestone payment for progress on the REV102 program [12] Group 6: Vor Biopharma Inc. (VOR) - VOR rose 3.6% in after-hours trading to $38.00, recovering from a 6.6% decline during the regular session, with a market cap of $251 million [13][14] - The company is focusing on its trem-cel platform and CD33-directed therapies for acute myeloid leukemia, alongside new executive appointments [14]

Financial Performance - Total revenue for Q2 2025 was $212,000, a decrease of 29.1% compared to $299,000 in Q2 2024[18] - Net loss for Q2 2025 was $9,703,000, compared to a net loss of $16,236,000 in Q2 2024, representing a 40.5% improvement[18] - The company reported a comprehensive loss of $19,193,000 for the first half of 2025, compared to $35,351,000 in the same period of 2024[18] - The net loss for the three months ended June 30, 2025, was $9,703 thousand, a decrease from $16,236 thousand in the same period of 2024[54] - The company reported a net loss per common share of $0.22 for the three months ended June 30, 2025, compared to $0.37 in 2024[54] - Net loss for the six months ended June 30, 2025, was $19.1 million, compared to a net loss of $35.3 million for the same period in 2024, a reduction of $16.1 million[116] - The company has an accumulated deficit of $312.2 million as of June 30, 2025, primarily due to research and development costs[91] - The company incurred net losses of $9.7 million and $19.1 million for the three and six months ended June 30, 2025, respectively, compared to $16.2 million and $35.3 million for the same periods in 2024[159] Cash and Assets - Cash and cash equivalents decreased to $9,445,000 as of June 30, 2025, from $13,903,000 at the end of 2024, a decline of 32.4%[15] - Total assets decreased to $51,003,000 as of June 30, 2025, down 25.1% from $68,108,000 at the end of 2024[15] - Total stockholders' equity fell to $45,964,000 as of June 30, 2025, a decrease of 25.4% from $61,654,000 at the end of 2024[15] - The company had $36,304,000 in marketable securities as of June 30, 2025, down from $51,608,000 at the end of 2024, a decrease of 29.5%[15] - As of June 30, 2025, the company had cash, cash equivalents, and marketable securities totaling $45.7 million, expected to fund operations for over 12 months[26] - As of June 30, 2025, the company had $45.7 million in cash, cash equivalents, and marketable securities[128] - The company expects existing cash and marketable securities to fund operations into the middle of 2027[130] Research and Development - Research and development expenses for the first half of 2025 were $11,799,000, down 54.4% from $25,882,000 in the same period of 2024[18] - Research and development expenses for the three months ended June 30, 2025, were $6.1 million, down from $12.9 million in the same period in 2024, a reduction of $6.9 million[109] - The company has not generated any revenue from product sales since inception and continues to focus on research and development activities[86] - The company incurred restructuring charges of approximately $1.7 million due to a workforce reduction of about 40% of its positions[58] - The company discontinued the RLYB212 program in April 2025 due to insufficient pharmacokinetic data from the Phase 2 clinical trial[26] - The company initiated a confirmatory pharmacokinetic and pharmacodynamic study of RLYB116 in Q2 2025, with data expected in Q3 and Q4 2025[26] - RLYB116 demonstrated a reduction in free C5 greater than 99% within 24 hours at a 100 mg dose in the Phase 1 study, indicating strong efficacy[77] - The Company initiated a confirmatory PK/PD trial for RLYB116 in Q2 2025, evaluating weekly dosing of 150 mg and 225 mg[81] - RLYB332, a long-acting version of RLYB331, showed favorable tolerability and sustained pharmacodynamic effects in non-clinical studies[82] - The Phase 2 clinical trial for RLYB212 showed an inability to achieve predicted target concentrations, leading to the discontinuation of its development[181] - The company has invested a significant portion of its resources in the development of RLYB212 and RLYB116, with future success reliant on successful clinical trials and marketing approvals[177] Financing and Capital Requirements - The company raised approximately $182.5 million from equity financings prior to its IPO and received net proceeds of approximately $83.0 million from its IPO in August 2021[87] - In November 2022, the company completed a follow-on offering, raising approximately $54.8 million, with net proceeds of approximately $50.8 million after costs[88] - The company expects to incur significant additional operating losses as it advances its product candidates through clinical development[92] - The company expects to finance operations through equity sales, debt financing, and collaborations, with no current credit facility or committed capital sources[134] - Future capital requirements will depend on various factors, including clinical trial costs, regulatory requirements, and the development of additional product candidates[135] - The company will require significant additional capital to fund operations and may prioritize certain product candidates due to limited resources[162] - The company may raise additional capital through equity offerings, debt financings, or strategic alliances, but this could lead to dilution of stockholder ownership[165] Risks and Challenges - The company faces risks related to the commercialization of its product candidates, including competition and the need for effective marketing and distribution strategies[184] - Patient enrollment in clinical trials for rare diseases is challenging, which may lead to increased costs and delays in product development[194] - The lengthy and unpredictable marketing approval process by the FDA and EMA may significantly harm the company's ability to commercialize its product candidates[202] - The company has never obtained marketing approval for any product candidate, which could prevent it from generating revenues and achieving profitability[207] - Serious adverse events or undesirable side effects from product candidates could halt clinical development or delay marketing approval, impacting sales and market acceptance[198] - The company may struggle to identify eligible patients for its product candidates due to limited screening and diagnostic tests, potentially affecting revenue growth[211] - The risk of patient dropout during clinical trials could lead to increased costs and delays in product development[197] - Regulatory changes and legal challenges could create additional uncertainty and impact the company's operations and ability to obtain approvals[182] - The company must demonstrate safety and efficacy through extensive preclinical studies and clinical trials before obtaining marketing approvals from regulatory authorities[183] - The company is heavily dependent on the success of RLYB116, which is currently in early-stage clinical development, with no products generating revenue at this time[177] - The company may face challenges in transitioning from a research-focused entity to one capable of supporting commercial activities[171] - The potential for competition to render product candidates obsolete or less competitive is a significant concern for the company's future prospects[213]

[Second Quarter 2025 Overview](index=1&type=section&id=Rallybio%20Reports%20Second%20Quarter%202025%20Financial%20Results%20and%20Provides%20Business%20Updates) Rallybio reported its Q2 2025 financial results, highlighting the advancement of its lead program RLYB116, the strategic divestiture of REV102, and an extended cash runway into mid-2027 [Executive Summary](index=1&type=section&id=Executive%20Summary) Rallybio reported its Q2 2025 financial results, highlighting the advancement of its lead program RLYB116, the strategic divestiture of REV102, and an extended cash runway into mid-2027 - Data readouts from Cohort 1 and Cohort 2 of RLYB116 confirmatory PK/PD study are on track for 3Q and 4Q 2025, respectively[2](index=2&type=chunk) - Sold interest in REV102 to Recursion Pharmaceuticals for up to **$25 million**, including an upfront equity payment of **$7.5 million**[2](index=2&type=chunk) - Cash runway extended into **mid-2027**[2](index=2&type=chunk) Q2 2025 Key Financial Highlights (in millions) | Metric | Q2 2025 | Q2 2024 | Change (YoY) | | :----- | :------ | :------ | :----------- | | Net Loss | $(9.7) | $(16.2) | Improved by $6.5 | | Net Loss Per Common Share | $(0.22) | $(0.37) | Improved by $0.15 | [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Stephen Uden highlighted the significant progress of RLYB116 into a confirmatory PK/PD study and the strategic importance of the REV102 divestiture for disciplined portfolio management and balance sheet strengthening - Advanced lead program RLYB116 into a confirmatory PK/PD study, reflecting strong science and team dedication[3](index=3&type=chunk) - Strategic divestiture of a preclinical asset (REV102) underscores commitment to disciplined portfolio management, sharpening focus and strengthening the balance sheet[3](index=3&type=chunk) - Topline data from RLYB116 Cohort 1 and Cohort 2 expected in **3Q and 4Q 2025**, respectively[3](index=3&type=chunk) [Recent Business Highlights and Upcoming Milestones](index=1&type=section&id=Recent%20Business%20Highlights%20and%20Upcoming%20Milestones) Rallybio achieved significant program milestones, including advancing RLYB116, divesting REV102, and evaluating RLYB332, while discontinuing RLYB212 [Corporate Updates](index=1&type=section&id=Corporate%20Updates) Rallybio announced the sale of its interest in REV102 to Recursion Pharmaceuticals, securing an upfront equity payment and potential future milestones and royalties, which significantly extends the company's cash runway - Entered into a definitive agreement in **July 2025** to sell interest in REV102 to Recursion Pharmaceuticals for up to **$25.0 million**[4](index=4&type=chunk) - Upfront equity payment of **$7.5 million** extends Rallybio's cash runway into **mid-2027**[4](index=4&type=chunk) - Eligible for contingent equity payment of **$12.5 million** upon initiation of additional preclinical studies and a **$5.0 million** cash milestone upon initiation of dosing in a Phase 1 clinical study[4](index=4&type=chunk) - Also eligible to receive low single-digit royalties on future net sales and potential payments if Recursion sells the REV102 program[4](index=4&type=chunk) [RLYB116 Program](index=1&type=section&id=RLYB116%20Program) The RLYB116 program initiated dosing in its confirmatory PK/PD study in June 2025, with data expected later in the year, and has identified immune platelet transfusion refractoriness (PTR) and refractory antiphospholipid syndrome (APS) as initial indications - Dosing initiated in RLYB116 confirmatory clinical PK/PD study in **June 2025**[5](index=5&type=chunk) - Results from Cohort 1 and Cohort 2 anticipated in **3Q and 4Q 2025**, expected to demonstrate complete and sustained complement inhibition and improved tolerability[5](index=5&type=chunk) - Initial indication focus for RLYB116 will be immune platelet transfusion refractoriness (PTR) and refractory antiphospholipid syndrome (APS)[5](index=5&type=chunk) [RLYB332 Program](index=2&type=section&id=RLYB332%20Program) Rallybio is evaluating future development plans for RLYB332, a long-acting anti-matriptase-2 antibody, which has shown superior preclinical data for treating iron overload diseases - Continues to evaluate plans for future development of RLYB332, a long-acting, monoclonal anti-matriptase-2 antibody[6](index=6&type=chunk) - Potential to be a best-in-class treatment for diseases of iron overload[6](index=6&type=chunk) - Preclinical data demonstrated superior impact on PD parameters (serum iron, UIBC, TSAT) relative to comparator molecules[6](index=6&type=chunk) [RLYB212 Program](index=2&type=section&id=RLYB212%20Program) The RLYB212 program for preventing FNAIT was discontinued in April 2025 due to pharmacokinetic data from the Phase 2 trial indicating the dose regimen's inability to achieve target concentrations required for efficacy - Discontinuation of the RLYB212 program in **April 2025** for the prevention of fetal and neonatal alloimmune thrombocytopenia (FNAIT)[7](index=7&type=chunk) - Decision based on PK data from Phase 2 clinical trial showing inability of dose regimen to achieve predicted target concentrations and minimum target concentration for efficacy[7](index=7&type=chunk) - Safety follow-up of the sentinel participant in the Phase 2 trial will continue[7](index=7&type=chunk) [Second Quarter 2025 Financial Results](index=2&type=section&id=Second%20Quarter%202025%20Financial%20Results) Rallybio reported a significant reduction in net loss for Q2 2025, driven by lower operating expenses, and maintained a cash position supporting operations into mid-2027 [Key Financial Highlights](index=2&type=section&id=Key%20Financial%20Highlights) Rallybio reported a decrease in revenue and a significant reduction in net loss for Q2 2025 compared to Q2 2024, primarily driven by lower R&D and G&A expenses, partially offset by workforce reduction costs. The company's cash position was $45.7 million as of June 30, 2025, with a projected runway into mid-2027 Selected Financial Results (Q2 2025 vs. Q2 2024) (in thousands) | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | Change (YoY) | Primary Reason for Change | | :----- | :--------------------- | :--------------------- | :----------- | :------------------------ | | Revenue | $212 | $299 | $(87) | Decrease related to collaboration agreement with Johnson & Johnson in Q2 2024 | | R&D Expenses | $6,074 | $12,946 | $(6,872) | Decrease in development costs for RLYB212, RLYB116, and other candidates, offset by increased payroll due to workforce reduction | | G&A Expenses | $4,195 | $4,388 | $(193) | Decrease in professional fees and other G&A, offset by increased payroll due to workforce reduction | | Net Loss | $(9,703) | $(16,236) | $(6,533) | Improved due to lower R&D and G&A expenses | | Net Loss Per Common Share | $(0.22) | $(0.37) | $(0.15) | Improved | - Cash, cash equivalents, and marketable securities were **$45.7 million** as of **June 30, 2025**[10](index=10&type=chunk) - Funds, combined with the upfront payment from REV102 sale, are expected to support operations into **mid-2027**[10](index=10&type=chunk) [About Rallybio](index=2&type=section&id=About%20Rallybio) Rallybio is a clinical-stage biotechnology company focused on developing transformative therapies for severe and rare diseases, with a pipeline in complement dysregulation and hematology [Company Overview and Pipeline](index=2&type=section&id=Company%20Overview%20and%20Pipeline) Rallybio is a clinical-stage biotechnology company dedicated to developing transformative therapies for severe and rare diseases, with a pipeline focused on complement dysregulation and hematology, including its lead program RLYB116 - Clinical-stage biotechnology company focused on developing and commercializing life-transforming therapies for patients with severe and rare diseases[9](index=9&type=chunk) - Pipeline addresses unmet medical needs in complement dysregulation and hematology[9](index=9&type=chunk) - Lead program RLYB116 is a differentiated C5 inhibitor for diseases of complement dysregulation, initially focusing on immune platelet transfusion refractoriness (PTR) and refractory antiphospholipid syndrome (APS)[9](index=9&type=chunk) - Pipeline also includes RLYB332, a preclinical long-acting matriptase-2 antibody for iron overload[9](index=9&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section provides a cautionary statement regarding forward-looking statements, outlining inherent risks and uncertainties that could cause actual results to differ materially [Disclaimer and Risk Factors](index=3&type=section&id=Disclaimer%20and%20Risk%20Factors) This section serves as a cautionary statement, indicating that the press release contains forward-looking statements based on management's current expectations, which are subject to various known and unknown risks, uncertainties, and assumptions, and are not guaranteed to occur - Press release contains forward-looking statements based on management's beliefs and assumptions, subject to known and unknown risks, uncertainties, and assumptions[11](index=11&type=chunk) - Forward-looking statements include timing of RLYB116 data, potential commercial opportunity, future payments from REV102 sale, and cash runway[11](index=11&type=chunk) - Risks include ability to conduct clinical trials, sufficiency of cash resources, ability to raise capital, strategic partnerships, competition, and SEC filings[11](index=11&type=chunk) - Company is not obligated to publicly update or revise any forward-looking statements unless required by applicable law[11](index=11&type=chunk) [Financial Tables](index=4&type=section&id=Financial%20Tables) This section presents the unaudited condensed consolidated financial statements, including statements of operations and balance sheets, for the specified periods [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Presents the unaudited consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2025, and 2024, detailing revenue, operating expenses, other income, and net loss Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) | (in thousands, except share and per share amounts) | FOR THE THREE MONTHS ENDED JUNE 30, 2025 | FOR THE THREE MONTHS ENDED JUNE 30, 2024 | FOR THE SIX MONTHS ENDED JUNE 30, 2025 | FOR THE SIX MONTHS ENDED JUNE 30, 2024 | | :----------------------------------------------- | :--------------------------------------- | :--------------------------------------- | :--------------------------------------- | :--------------------------------------- | | Collaboration and license revenue | $212 | $299 | $424 | $299 | | Total revenue | $212 | $299 | $424 | $299 | | Research and development | $6,074 | $12,946 | $11,799 | $25,882 | | General and administrative | $4,195 | $4,388 | $8,352 | $11,239 | | Total operating expenses | $10,269 | $17,334 | $20,151 | $37,121 | | Loss from operations | $(10,057) | $(17,035) | $(19,727) | $(36,822) | | Interest income | $523 | $1,143 | $1,167 | $2,419 | | Other income | $118 | $143 | $292 | $310 | | Total other income, net | $641 | $1,286 | $1,459 | $2,729 | | Loss before equity in losses of joint venture | $(9,416) | $(15,749) | $(18,268) | $(34,093) | | Loss on investment in joint venture | $287 | $487 | $874 | $1,172 | | Net loss | $(9,703) | $(16,236) | $(19,142) | $(35,265) | | Net loss per common share, basic and diluted | $(0.22) | $(0.37) | $(0.43) | $(0.83) | | Weighted-average common shares outstanding, basic and diluted | 44,841,140 | 44,128,059 | 44,808,055 | 42,450,837 | | Net unrealized loss on marketable securities | $(30) | — | $(51) | $(86) | | Other comprehensive loss | $(30) | — | $(51) | $(86) | | Comprehensive loss | $(9,733) | $(16,236) | $(19,193) | $(35,351) | [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Presents the unaudited condensed consolidated balance sheets as of June 30, 2025, and December 31, 2024, detailing assets, liabilities, and stockholders' equity Condensed Consolidated Balance Sheets (Unaudited) | (in thousands) | JUNE 30, 2025 | DECEMBER 31, 2024 | | :------------- | :------------ | :---------------- | | Cash, cash equivalents and marketable securities | $45,749 | $65,511 | | Total assets | $51,003 | $68,108 | | Total liabilities | $5,039 | $6,454 | | Total stockholders' equity | $45,964 | $61,654 | [Contacts](index=5&type=section&id=Investor%20Contacts) This section provides contact information for investor relations and media inquiries for Rallybio Corporation [Investor and Media Contacts](index=5&type=section&id=Investor%20and%20Media%20Contacts) Provides contact information for investor relations and media inquiries for Rallybio Corporation - Investor Contacts: Samantha Tracy (Rallybio Corporation) and Kevin Lui (Precision AQ)[15](index=15&type=chunk) - Media Contact: media@rallybio.com[15](index=15&type=chunk)

Core Viewpoint - Shares in Recursion Pharmaceuticals surged over 12% due to a de-risking event in its drug discovery pipeline related to the acquisition of a 50% interest in the ENPP1 inhibitor program REV102 from Rallybio [1][2] Group 1: Acquisition Details - Recursion acquired the remaining 50% interest in the ENPP1 inhibitor program REV102, which is being developed to treat hypophosphatasia (HPP), a rare genetic disorder affecting bone development [2][3] - The joint venture with Rallybio has resulted in the development of REV102, which is currently in the preclinical stage [3] Group 2: Financial Terms of the Deal - The deal includes an upfront equity payment of $7.5 million, an additional equity payment of $12.5 million if REV102 undergoes further preclinical trials, and a $5 million milestone payment upon initiation of dosing in a phase 1 study [6] - Recursion will also receive low-single-digit royalties on future sales of REV102 [6] Group 3: Implications for Development - The agreement reduces the risk associated with the development of REV102 and alleviates uncertainties related to Rallybio's financial condition, thereby adding value to Recursion's pipeline [7]

Core Insights - Recursion has acquired Rallybio's full interest in the ENPP1 inhibitor program (REV102) for treating hypophosphatasia (HPP), a rare genetic disorder [1][2] - The acquisition allows Recursion to accelerate the development of the first potential oral disease-modifying treatment for HPP patients, who currently have limited access to therapies [2][4] - REV102 targets the ENPP1 enzyme, aiming to restore the balance of inorganic pyrophosphate necessary for proper bone mineralization [3][4] Company Overview - Recursion is a clinical stage TechBio company focused on decoding biology to industrialize drug discovery, utilizing an integrated AI/experimental platform known as Recursion OS [8][9] - The company operates one of the most powerful supercomputers globally and conducts millions of wet lab experiments weekly to advance drug discovery [9] Program Details - REV102 is designed to be the first oral disease-modifying therapy for HPP, potentially offering advantages in convenience and safety over existing injectable treatments [5][6] - The program is currently in IND-enabling studies, with Phase 1 clinical trials expected to begin in the second half of 2026 [6] Financial Terms of the Agreement - Under the acquisition agreement, Rallybio will receive $7.5 million in upfront equity, a contingent equity payment of $12.5 million upon the initiation of additional preclinical studies, and a $5 million milestone payment related to Phase 1 clinical study dosing [7] - Rallybio is also eligible for low single-digit royalties on future net sales by Recursion and potential payments in the event of Recursion's sale of the REV102 program [7]

RLYB116 - C5 Inhibitor - RLYB116 is being developed as a potential first- and best-in-class treatment for severe, refractory hematologic diseases[4, 12] - The estimated peak commercial opportunity for RLYB116 in immune PTR (Platelet Transfusion Refractoriness) is over $1.1 billion annually, targeting approximately 20,000 patients[13, 50, 51] - The estimated peak commercial opportunity for RLYB116 in refractory APS (Antiphospholipid Syndrome) is over $4.0 billion, also targeting approximately 20,000 patients[13, 50, 51] - A Phase 2 trial for immune PTR is expected to begin in the middle of 2026, and a Phase 2 trial for refractory APS is expected to begin in the second half of 2026[13] - Clinical PK/PD study data for RLYB116 is expected in the second half of 2025, with Cohort 1 data in Q3 2025 and Cohort 2 data in Q4 2025[4, 18, 66] REV102 - ENPP1 Inhibitor - REV102 is a potential first- and best-in-class ENPP1 inhibitor for patients with hypophosphatasia (HPP)[4, 54] - Phase 1 study on track to initiate 2H 2026[55] - Preclinical data for REV102 in a later-onset HPP model is expected in the second half of 2025[4, 66] Financial Position - Rallybio's cash position as of March 31, 2025, was $54.5 million, which is expected to support operations into the first half of 2027[5]

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=7&type=section&id=Item%201.%20Financial%20Statements) This section presents Rallybio Corporation's unaudited condensed consolidated financial statements for the period ended March 31, 2025 [Unaudited Condensed Consolidated Balance Sheets](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to **$58.0 million** from **$68.1 million** by March 31, 2025, mainly due to reduced marketable securities Condensed Consolidated Balance Sheet Data (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $14,779 | $13,903 | | Marketable securities | $39,716 | $51,608 | | Total current assets | $57,381 | $67,841 | | **Total assets** | **$57,983** | **$68,108** | | **Liabilities & Stockholders' Equity** | | | | Total current liabilities | $3,910 | $6,242 | | **Total liabilities** | **$3,910** | **$6,454** | | **Total stockholders' equity** | **$54,073** | **$61,654** | - The company's cash, cash equivalents, and marketable securities totaled **$54.5 million** as of March 31, 2025[28](index=28&type=chunk) [Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Net loss improved to **$9.4 million** in Q1 2025 from **$19.0 million** in Q1 2024, reflecting lower operating expenses and new collaboration revenue Statement of Operations Highlights (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Collaboration and license revenue | $212 | $0 | | Research and development expense | $5,725 | $12,936 | | General and administrative expense | $4,157 | $6,851 | | Loss from operations | $(9,670) | $(19,787) | | **Net loss** | **$(9,439)** | **$(19,029)** | | Net loss per common share, basic and diluted | $(0.21) | $(0.47) | [Unaudited Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities decreased to **$10.2 million** in Q1 2025, while investing activities provided **$11.1 million**, resulting in an ending cash balance of **$14.8 million** Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(10,205) | $(15,457) | | Net cash provided by investing activities | $11,081 | $10,264 | | Net cash provided by financing activities | $0 | $0 | | **Net increase (decrease) in cash** | **$876** | **$(5,193)** | | **Cash and cash equivalents - end of period** | **$14,779** | **$19,301** | [Notes to Unaudited Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes detail business operations, liquidity, and accounting policies, including the RLYB212 program discontinuation, Johnson & Johnson collaboration, and workforce reductions - In April 2025, the company announced the discontinuation of its RLYB212 program for the prevention of fetal and neonatal alloimmune thrombocytopenia (FNAIT)[27](index=27&type=chunk) - The company expects its cash, cash equivalents, and marketable securities of **$54.5 million** (as of March 31, 2025) to be sufficient to fund operations for more than 12 months from the report's issuance date[28](index=28&type=chunk) - In February 2024, the company initiated a workforce reduction of approximately **45%**, incurring charges of about **$3.3 million**, which were recognized in Q1 2024[59](index=59&type=chunk)[60](index=60&type=chunk) - In April 2024, the company entered into a two-year collaboration with Johnson & Johnson for FNAIT research, receiving a **$0.5 million** upfront payment, and also sold **$6.6 million** of common stock to JJDC, a J&J affiliate[39](index=39&type=chunk)[62](index=62&type=chunk) - A subsequent workforce reduction of approximately **40%** was approved on May 2, 2025, with expected charges of **$1.7 million** to be recognized in Q2 2025[72](index=72&type=chunk)[73](index=73&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses business strategy, financial results, and liquidity, highlighting the shift to lead program RLYB116, reduced Q1 2025 net loss, and the need for substantial additional capital [Business Overview](index=22&type=section&id=Business%20Overview) Rallybio, a clinical-stage biotech, focuses on rare diseases with lead program RLYB116, following the discontinuation of RLYB212, and advancing preclinical programs REV102 and RLYB332 - The company's lead program, RLYB116, is a C5 inhibitor, with a confirmatory PK/PD study in healthy volunteers planned for Q2 2025, expecting data in Q3 and Q4 2025[75](index=75&type=chunk) - The RLYB212 program for FNAIT was discontinued in April 2025 after Phase 2 PK data indicated the dose regimen could not achieve the minimum target concentration for efficacy[75](index=75&type=chunk)[84](index=84&type=chunk) - Preclinical programs include REV102, an ENPP1 inhibitor for hypophosphatasia, and RLYB332, a long-acting MTP-2 antibody for iron overload diseases[75](index=75&type=chunk)[81](index=81&type=chunk)[82](index=82&type=chunk) [Results of Operations](index=28&type=section&id=Results%20of%20Operations) Total operating expenses decreased by **$9.9 million** in Q1 2025, driven by reduced R&D and G&A costs, while collaboration revenue of **$0.2 million** was recognized Comparison of Operating Results (in thousands) | Item | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $212 | $0 | $212 | | Research and development | $5,725 | $12,936 | $(7,211) | | General and administrative | $4,157 | $6,851 | $(2,694) | | **Loss from operations** | **$(9,670)** | **$(19,787)** | **$10,117** | - R&D expenses decreased by **$7.2 million**, primarily due to a **$3.2 million** reduction in RLYB212 development costs and a **$2.6 million** decrease in personnel-related expenses following the March 2024 workforce reduction[111](index=111&type=chunk) - G&A expenses decreased by **$2.7 million**, mainly due to a **$2.3 million** reduction in payroll and personnel-related costs from the workforce reduction[112](index=112&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company held **$54.5 million** in cash and equivalents, projected to fund operations into H1 2027, but substantial additional capital is required for product development - The company believes its existing cash, cash equivalents, and marketable securities of **$54.5 million** will fund operating expenses and capital requirements into the first half of 2027[90](index=90&type=chunk)[121](index=121&type=chunk) - The company will need to raise substantial additional capital to complete the development and commercialization of its product candidates[90](index=90&type=chunk)[91](index=91&type=chunk) - The company has an effective Shelf Registration Statement on Form S-3 for up to **$300.0 million**, subject to limitations restricting fundraising capacity to one-third of its public float in a 12-month period[115](index=115&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Rallybio is exempt from providing quantitative and qualitative disclosures about market risk - The company is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide information under this item[140](index=140&type=chunk) [Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting - Management concluded that as of March 31, 2025, the company's disclosure controls and procedures were effective at the reasonable assurance level[143](index=143&type=chunk) - There were no changes in internal control over financial reporting during the most recently completed fiscal quarter that materially affected, or are reasonably likely to materially affect, internal controls[144](index=144&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=35&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 - Rallybio is not currently a party to any litigation or legal proceedings that, in management's opinion, are probable to have a material adverse effect on the business[146](index=146&type=chunk) [Risk Factors](index=35&type=section&id=Item%201A.%20Risk%20Factors) This section outlines key risks including historical losses, capital requirements, dependence on RLYB116, clinical development uncertainties, competition, reliance on third parties, and potential stock price volatility and delisting - The company has a history of significant losses (**$9.4 million** in Q1 2025) and an accumulated deficit of **$302.5 million** as of March 31, 2025, expecting continued losses and potential unprofitability[148](index=148&type=chunk) - The company is heavily dependent on the success of RLYB116, an early-stage clinical candidate, with the recent RLYB212 program failure highlighting high clinical development risks[12](index=12&type=chunk)[166](index=166&type=chunk)[167](index=167&type=chunk) - Significant additional capital is required to fund operations and complete development, as existing cash, expected to last into H1 2027, is insufficient to bring any product to market[151](index=151&type=chunk)[152](index=152&type=chunk) - The company faces Nasdaq delisting risk due to its stock price falling below the **$1.00** minimum bid requirement, with a compliance deadline of August 25, 2025[353](index=353&type=chunk)[354](index=354&type=chunk) - Rallybio relies on third-party contract manufacturing organizations (CMOs) for manufacturing, increasing risks related to supply, quality control (cGMP compliance), and regulatory approval of manufacturing sites[255](index=255&type=chunk)[256](index=256&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=85&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered equity sales during Q1 2025 and confirmed full utilization of its 2021 Initial Public Offering proceeds as of March 31, 2025 - The company has not issued any unregistered equity securities during the quarter ended March 31, 2025[387](index=387&type=chunk) - As of March 31, 2025, the proceeds from the company's IPO have been fully utilized[390](index=390&type=chunk) [Other Information](index=86&type=section&id=Item%205.%20Other%20Information) No directors or officers entered into, modified, or terminated Rule 10b5-1 trading plans or other non-Rule 10b5-1 trading arrangements during Q1 2025 - No directors or officers entered into, modified, or terminated a Rule 10b5-1 trading plan or non-Rule 10b5-1 trading arrangement during the first quarter of 2025[391](index=391&type=chunk) [Exhibits](index=87&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with Form 10-Q, including CEO and CFO certifications and an amendment to the Sales Agreement with TD Securities - Exhibits filed include CEO and CFO certifications under Sarbanes-Oxley Act Sections 302 and 906[392](index=392&type=chunk) - An amendment to the Sales Agreement with TD Securities (USA) LLC, dated March 13, 2025, was filed as an exhibit[392](index=392&type=chunk)

Rallybio Q1 2025 Financial Results and Business Update [Business Highlights and Pipeline Update](index=1&type=section&id=Recent%20Business%20Highlights%20and%20Upcoming%20Milestones) Rallybio provides updates on its clinical and preclinical programs, including progress on RLYB116 and REV102, and the discontinuation of RLYB212, while evaluating RLYB332 development [RLYB116 Program](index=1&type=section&id=RLYB116%20Program) The company is on track to start a confirmatory PK/PD study for RLYB116, a C5 inhibitor for complement-driven diseases, in Q2 2025, with data readouts expected in the second half of 2025 - A confirmatory pharmacokinetic/pharmacodynamic (PK/PD) study for RLYB116 is set to begin dosing in the second quarter of 2025[4](index=4&type=chunk) - Data readouts are anticipated in **Q3 2025 for Cohort 1 (150 mg)** and **Q4 2025 for Cohort 2 (225 mg)**[4](index=4&type=chunk) - The study aims to demonstrate RLYB116's potential for complete and sustained complement inhibition with improved tolerability, positioning it as a potential best-in-class therapeutic for complement-driven diseases[3](index=3&type=chunk)[4](index=4&type=chunk) [REV102 Program](index=1&type=section&id=REV102%20Program) IND-enabling studies are underway for REV102, an ENPP1 inhibitor for hypophosphatasia (HPP), developed with Recursion Pharmaceuticals, with a Phase 1 study planned for the second half of 2026 - Investigational new drug application (IND)-enabling studies are underway for REV102, an ENPP1 inhibitor for treating hypophosphatasia (HPP)[7](index=7&type=chunk) - A Phase 1 study is expected to be initiated in the second half of 2026, supported by the ongoing studies[7](index=7&type=chunk) - Data from a preclinical model of later-onset HPP is expected to be presented in the second half of 2025[7](index=7&type=chunk) [RLYB332 Program](index=1&type=section&id=RLYB332%20Program) Rallybio is assessing future development for RLYB332, a long-acting antibody for iron overload diseases, with preclinical data showing superior impact on key parameters compared to other molecules - Rallybio continues to evaluate development plans for RLYB332, a long-acting monoclonal antibody for diseases of iron overload[6](index=6&type=chunk) - Preclinical data has shown RLYB332 has a superior impact on pharmacodynamic (PD) parameters like serum iron and transferrin saturation (TSAT) compared to comparator molecules[6](index=6&type=chunk) [RLYB212 Program](index=2&type=section&id=RLYB212%20Program) In April 2025, Rallybio discontinued the RLYB212 program for preventing fetal and neonatal alloimmune thrombocytopenia (FNAIT) due to Phase 2 PK data indicating the dose regimen failed to achieve required target concentrations for efficacy - The RLYB212 program for the prevention of fetal and neonatal alloimmune thrombocytopenia (FNAIT) was discontinued in April 2025[8](index=8&type=chunk) - The decision was based on Phase 2 clinical trial PK data showing the dose regimen was unable to achieve the minimum target concentration required for efficacy[8](index=8&type=chunk) [Corporate Update](index=2&type=section&id=Corporate%20Update) Rallybio is implementing a 40% workforce reduction, affecting nine positions, to be completed by the end of Q2 2025, resulting in approximately $1.7 million in charges for severance and benefits - A **40% workforce reduction**, representing nine positions, will be substantially complete by the end of Q2 2025[9](index=9&type=chunk) - The company estimates the reduction will result in aggregate charges of approximately **$1.7 million**, primarily for one-time employee severance and benefit costs[9](index=9&type=chunk) [First Quarter 2025 Financial Results](index=2&type=section&id=First%20Quarter%202025%20Financial%20Results) For Q1 2025, Rallybio reported a net loss of $9.4 million, a significant reduction from the $19.0 million loss in Q1 2024, driven by lower expenses and collaboration revenue, ending the quarter with $54.5 million in cash, providing a runway into H1 2027 Q1 2025 Financial Highlights (in millions) | Metric | Q1 2025 (USD) | Q1 2024 (USD) | Change (USD) | | :--- | :--- | :--- | :--- | | Revenue | $0.2 | $0 | +$0.2 | | R&D Expenses | $5.7 | $12.9 | -55.8% | | G&A Expenses | $4.2 | $6.9 | -39.4% | | Net Loss | $9.4 | $19.0 | -50.5% | | Net Loss Per Share | $0.21 | $0.47 | -55.3% | - Cash, cash equivalents, and marketable securities were **$54.5 million** as of March 31, 2025[12](index=12&type=chunk) - The current cash position is expected to fund operations into the **first half of 2027**[12](index=12&type=chunk) - The decrease in operating expenses was primarily due to lower development costs for RLYB212 and RLYB116, and reduced payroll costs following a workforce reduction in Q1 2024[12](index=12&type=chunk) [Financial Tables](index=4&type=section&id=Financial%20Tables) The financial tables provide detailed, unaudited condensed consolidated statements of operations and balance sheets for the period ended March 31, 2025, compared to prior periods [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For the three months ended March 31, 2025, Rallybio reported total revenues of $0.212 million and a net loss of $9.439 million, or $0.21 per share, compared to no revenue and a net loss of $19.029 million, or $0.47 per share, in the prior-year period Condensed Consolidated Statements of Operations (Unaudited) *(in thousands, except per share data)* | | For the Three Months Ended March 31, | | | :--- | :---: | :---: | | | **2025** | **2024** | | Collaboration and license revenue | $212 | $— | | **Total revenue** | **$212** | **$—** | | Research and development | $5,725 | $12,936 | | General and administrative | $4,157 | $6,851 | | **Total operating expenses** | **$9,882** | **$19,787** | | **Loss from operations** | **($9,670)** | **($19,787)** | | **Net loss** | **($9,439)** | **($19,029)** | | **Net loss per common share** | **($0.21)** | **($0.47)** | [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, Rallybio had $54.5 million in cash, cash equivalents, and marketable securities, with total assets of $58.0 million and total stockholders' equity of $54.1 million, compared to $65.5 million in cash and equivalents at the end of 2024 Condensed Consolidated Balance Sheet Highlights (Unaudited) *(in thousands)* | | **March 31, 2025** | **December 31, 2024** | | :--- | :---: | :---: | | Cash, cash equivalents and marketable securities | $54,495 | $65,511 | | Total assets | $57,983 | $68,108 | | Total liabilities | $3,910 | $6,454 | | Total stockholders' equity | $54,073 | $61,654 |