Core Insights - Sagimet Biosciences Inc. is a clinical-stage biopharmaceutical company focused on developing novel therapeutics targeting dysfunctional metabolic and fibrotic pathways, specifically through fatty acid synthase (FASN) inhibitors [1][3] - The company will present two oral presentations and participate in a drug development panel at the 9th Annual MASH Drug Development Summit from September 29 to October 1, 2025, in Boston, MA [1] Presentation Details - The first presentation will be led by Dr. Marie O'Farrell, focusing on the mechanism of action of the FASN inhibitor denifanstat in combination with semaglutide or resmetirom, highlighting results from the Phase 2b FASCINATE-2 study [2] - The second presentation by Dr. Wen-Wei Tsai will discuss the anti-fibrotic effect of denifanstat in MASH patients with advanced fibrosis, utilizing AI-based digital pathology techniques [2] Company Overview - Sagimet's lead drug candidate, denifanstat, is an oral, once-daily selective FASN inhibitor aimed at treating metabolic dysfunction associated steatohepatitis (MASH) [3][4] - Denifanstat has received Breakthrough Therapy designation from the FDA for treating non-cirrhotic MASH with moderate to advanced liver fibrosis [3][4] - The company has initiated a Phase 1 clinical trial for a second FASN inhibitor, TVB-3567, intended for acne treatment in the U.S. [4] Industry Context - MASH is a severe liver disease affecting over 115 million people globally, with limited approved treatments available [5] - The renaming of non-alcoholic fatty liver disease (NAFLD) to metabolic dysfunction-associated steatotic liver disease (MASLD) and nonalcoholic steatohepatitis (NASH) to MASH aims to provide a non-stigmatizing diagnosis [5]

Company Overview - Sagimet is a clinical stage biopharmaceutical company focused on developing programs that inhibit fatty acid synthase (FASN) [2] - FASN is an enzyme that regulates various organs and pathways in the body, and its overexpression is linked to several health issues [2] Key Development Areas - The primary development focus is on MASH (Metabolic Dysfunction-Associated Steatotic Liver Disease), acne, and certain solid tumors in oncology that require FASN for disease progression [2] - Significant work has been conducted in MASH and acne, with preclinical and clinical studies demonstrating the effectiveness of the lead molecule, denifanstat [3]

Summary of Sagimet Biosciences (SGMT) Conference Call Company Overview - Sagimet Biosciences is a clinical stage biopharmaceutical company focused on developing programs that inhibit fatty acid synthase (FASN) [5][6] - The company is primarily targeting indications such as Non-Alcoholic Steatohepatitis (NASH), acne, and certain solid tumors in oncology [5][6] Key Priorities and Developments - The lead molecule, danifanstat, has shown effectiveness in normalizing FASN levels, leading to improved outcomes in NASH by reducing fat, inflammation, and fibrosis [6][7] - Upcoming catalysts include: - A Phase I pharmacokinetic study in combination with resmineram for NASH patients, expected to start soon with data anticipated by the end of 2025 [7][8] - A Phase I study for the next-generation molecule 3,567 in acne, with completion expected by early 2026 and a Phase II program to follow [8] Mechanism of Action - FASN is crucial in converting sugars to fats, and its inhibition leads to reduced fatty acid production, impacting both liver health in NASH and inflammation in acne [10][11] - The mechanism for acne involves inhibiting the production of sapienic acid, which is linked to pimple formation [12][13] Clinical Trial Insights - The Phase III trial conducted by partner Ascletis in China for acne showed statistically significant results across all primary and secondary endpoints, with a favorable safety profile [16][17] - The acne market has not seen significant innovation in over 40 years, with the last major product being Accutane, which peaked at approximately $1 billion in sales in 2008 [32][33] Market Opportunity - The U.S. acne market presents a significant opportunity, with about 50 million Americans affected, and 10-15 million suffering from moderate to severe acne [30] - Only 5.1% of those with acne are actively treated by dermatologists, indicating a large potential for market penetration [30] Safety and Tolerability - The drug was well tolerated in trials, with fewer instances of dry eye compared to placebo, and minimal reports of hair thinning [22][23] - The company believes previous safety concerns in NASH trials were outliers due to external factors like COVID-19 [24][25] Regulatory Environment - The FDA has shown openness to non-invasive study proposals for NASH, which could lower costs and expedite enrollment [40][41] - Sagimet has breakthrough designation, allowing for more direct communication with the FDA regarding study designs [44] Financial Position - The company reported approximately $135 million in cash, expected to fund operations until 2028, covering ongoing trials and development of the next-generation acne molecule [58] Future Directions - Sagimet is exploring additional dermatological indications for FASN inhibition beyond acne [39] - The combination therapy approach is seen as a future direction for treating NASH, with expectations of synergistic effects from combining danifanstat with resmineram [56][57]

Core Thesis - Sagimet Biosciences Inc. (NASDAQ: SGMT) is identified as a small-cap biotech company with a novel mechanism that could provide a competitive advantage in the MASH market through the blocking of fatty acid synthase [1] Company Overview - The company is focused on innovative biotechnology solutions, particularly through unique mechanisms of action and first-in-class therapies [1] - Denifanstat is highlighted as a key product in the company's pipeline [1] Analyst Background - The analyst has a Master's degree in Cell Biology and extensive experience in drug discovery, which informs their investment analysis [1] - The analyst has been active in the investment space for five years, with a focus on biotech equity analysis for the last four years [1] Research Focus - The research emphasizes evaluating the science behind drug candidates, the competitive landscape, clinical trial design, and potential market opportunities [1] - The approach aims to balance scientific rigor with financial fundamentals and valuation [1] Market Potential - The biotech sector is characterized by the potential for breakthrough science to yield significant returns, necessitating careful scrutiny of investment opportunities [1]

Company Overview - Sagimet Biosciences Inc. is a clinical-stage biopharmaceutical company focused on developing novel therapeutics targeting dysfunctional metabolic and fibrotic pathways [3] - The company is developing fatty acid synthase (FASN) inhibitors, with its lead drug candidate, denifanstat, aimed at treating metabolic dysfunction associated steatohepatitis (MASH) [3] - Denifanstat is an oral, once-daily pill that has received Breakthrough Therapy designation from the FDA for treating non-cirrhotic MASH with moderate to advanced liver fibrosis [3] Clinical Trials and Developments - The FASCINATE-2 Phase 2b clinical trial of denifanstat in MASH has been successfully completed with positive results [3] - Sagimet has initiated a Phase 1 first-in-human clinical trial for a second oral FASN inhibitor, TVB-3567, which is planned for acne treatment in the U.S. [3] Upcoming Events - Management will participate in the Cantor Global Healthcare Conference in New York on September 3, 2025, with a fireside chat scheduled at 1:35 p.m. ET [4] - The company will also attend the H.C. Wainwright 27th Annual Global Investment Conference in New York on September 9, 2025 [4]

Group 1 - Sagimet Biosciences Inc. (SGMT) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][4][6] - The Zacks rating system focuses on a company's earnings picture, tracking the Zacks Consensus Estimate for EPS from sell-side analysts, which reflects the company's future earnings potential [2][5] - The recent increase in earnings estimates for Sagimet Biosciences suggests an improvement in its underlying business, likely leading to increased stock price due to investor interest [6][9] Group 2 - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly Zacks Rank 1 stocks averaging a +25% annual return since 1988 [8][10] - Sagimet Biosciences is expected to earn -$1.85 per share for the fiscal year ending December 2025, with a 25.6% increase in the Zacks Consensus Estimate over the past three months [9][11] - The upgrade to Zacks Rank 2 places Sagimet in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [10][11]

Group 1 - Sagimet Biosciences Inc. (SGMT) has experienced a significant decline of 28% over the past four weeks, but it is now in oversold territory, indicating a potential trend reversal [1] - The Relative Strength Index (RSI) for SGMT is currently at 29.42, suggesting that the heavy selling pressure may be exhausting itself [5] - There is a strong consensus among Wall Street analysts that SGMT will report better earnings than previously predicted, with a 13.2% increase in the consensus EPS estimate over the last 30 days [7] Group 2 - SGMT holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, indicating a potential turnaround [8]

[Introduction](index=1&type=section&id=Introduction) This section provides an overview of Sagimet Biosciences, including forward-looking statements, leadership, company highlights, and its comprehensive development pipeline across MASH, acne, and oncology [Forward-Looking Statements and Disclaimer](index=2&type=section&id=Forward-Looking%20Statements%20and%20Disclaimer) This section provides a standard disclaimer regarding forward-looking statements, highlighting the inherent risks and uncertainties in drug development, regulatory activities, and economic conditions that may cause actual results to differ materially from projections - The presentation contains forward-looking statements subject to unknown risks, uncertainties, and important factors that may cause actual results to differ from projections[2](index=2&type=chunk)[3](index=3&type=chunk) - Risks include clinical development, regulatory activities, successful completion of trials, emergence of unfavorable data, differing interpretations by regulatory authorities, capital requirements, and intellectual property protection[2](index=2&type=chunk) [Leadership Team](index=3&type=section&id=Leadership%20Team) Sagimet Biosciences is led by an experienced team with over 20 years of executive leadership in biotech and pharma, covering critical areas such as R&D, finance, legal, and commercialization - Sagimet's leadership team possesses over 20 years of experience in executive leadership, legal, IP, finance, and clinical development within the biotech and pharma industries[4](index=4&type=chunk)[5](index=5&type=chunk) [Sagimet at a Glance (Overview)](index=4&type=section&id=Sagimet%20at%20a%20Glance%20(Overview)) Sagimet Biosciences focuses on novel fatty acid synthase (FASN) inhibitors, with its lead molecule, denifanstat, demonstrating strong clinical data in MASH and acne. The company also has a follow-on FASN inhibitor, TVB-3567, a robust IP portfolio, and a solid cash position - Denifanstat, a novel FASN inhibitor, targets multiple underserved diseases, including MASH, where it met both primary endpoints in a Phase 2b trial[8](index=8&type=chunk) - TVB-3567, a follow-on FASN inhibitor, received Investigational New Drug (IND) clearance in March 2025 and initiated a first-in-human Phase 1 clinical trial for acne in June 2025[8](index=8&type=chunk) | Category | Detail | Expiration/Status | | :------- | :----- | :---------------- | | Denifanstat (Method of use) | Patent | 2036 (potential PTE to 2041) | | Denifanstat (Composition of matter) | Patent | 2032 | | Denifanstat + Resmetirom (Combination) | Application filed | 2024 (if granted, 2044; potential PTE to 2048) | | TVB-3567 (Method of use for acne) | Application filed | 2025 (if granted, 2045; potential PTE to 2048) | | TVB-3567 (Composition of matter) | Patent | 2035 (potential PTE to 2038) | | Cash Position | **$135.5 million** cash on hand (as of 06/30/2025) | Expected to fund current operations | [Development Pipeline](index=6&type=section&id=Development%20Pipeline) Sagimet's development pipeline features denifanstat and TVB-3567 across metabolic disease (MASH), dermatology (Acne), and oncology, with programs ranging from preclinical to Phase 3, including combination therapies | Therapeutic Area | Indication | Drug Candidate | Stage of Development | Expected Milestones | | :--------------- | :---------- | :------------- | :------------------- | :------------------ | | Metabolic Disease | MASH (F2/F3) | Denifanstat | Phase 2 (FDA B) | Phase 3 ready | | Metabolic Disease | MASH (F4) | Denifanstat | Phase 2 | Data reported 2025 | | Metabolic Disease | MASH (Combination) | Denifanstat/resmetirom | Phase 1 | Initiate 2H 2025 | | Dermatology | Acne | TVB-3567 | Phase 1 | Initiate 2H 2025 | | Dermatology | Acne | Denifanstat (ASC40) | Phase 3 | Data available | | Oncology | Solid tumors | TVB-3567 | Preclinical | Identify potential | | Oncology | Recurrent glioblastoma (GBM) | Denifanstat | Phase 3 | Achieved enrollment | | Oncology | Recurrent glioblastoma (GBM) | Denifanstat (ASC40) | Phase 3 | Achieved enrollment | [MASH (Metabolic Dysfunction-Associated Steatohepatitis)](index=7&type=section&id=MASH%20(Metabolic%20Dysfunction-Associated%20Steatohepatitis)) This section details the MASH market, the FASN inhibition mechanism, treatment goals, and extensive clinical data for denifanstat, including combination therapy development [MASH Market Overview](index=7&type=section&id=MASH%20Market%20Overview) MASH, formerly known as NASH, represents a significant and growing health epidemic, with millions of estimated patients in the US by 2030, progressing from MASLD to advanced fibrosis and hepatocellular carcinoma | Condition | Estimated Patients (US, 2030) | | :-------- | :----------------------------- | | MASLD | **100.9 million** | | MASH | **27.0 million** | | MASH mod-adv Fibrosis F2-F3 | **10.6 million** | | Cirrhosis F4 | **3.5 million** | | Hepatocellular carcinoma (annual cases) | **25 thousand** | - MASH, or metabolic dysfunction-associated steatohepatitis, was formerly known as NASH, or nonalcoholic steatohepatitis[15](index=15&type=chunk) [FASN Inhibition Mechanism in MASH](index=8&type=section&id=FASN%20Inhibition%20Mechanism%20in%20MASH) Denifanstat, a specific and potent FASN inhibitor, targets MASH through three independent mechanisms: blocking steatosis by inhibiting de novo lipogenesis, reducing inflammation by preventing immune cell activation, and blunting fibrosis by inhibiting stellate cell activation, as supported by preclinical data - Denifanstat, a FASN inhibitor, addresses MASH by blocking steatosis (inhibiting de novo lipogenesis), reducing inflammation (preventing immune cell activation), and blunting fibrosis (inhibiting stellate cell activation)[17](index=17&type=chunk) - Preclinical data demonstrates that denifanstat directly blocks human liver stellate cell fibrogenesis, as stellate cells require de novo lipogenesis (DNL) for fibrogenesis[19](index=19&type=chunk)[21](index=21&type=chunk) [MASH Treatment Goals](index=10&type=section&id=MASH%20Treatment%20Goals) MASH treatment goals are stratified by fibrosis stage, aiming to improve glycemic control, dyslipidemia, and reduce fat in earlier stages, while focusing on resolving steatohepatitis, preventing fibrosis progression, inducing regression, and preventing cirrhosis in more advanced stages | MASH Staging | F1 | F2-F3 | | :----------- | :-- | :---- | | Risk Staging | Low | Medium/High | | Primary Treatment | Improve Glycemic Control / Improve Dyslipidemia / Reduce Fat | Resolve Steatohepatitis | | Objectives | Prevent Fibrosis Progression / Induce Fibrosis Regression | Prevent Progression to Cirrhosis | | Primary Therapeutic Interventions | Metabolic & Obesity Drugs* | Metabolic* & Anti-Fibrotic Drugs / Potent Anti-Fibrotic Drugs | - Metabolic drugs are anticipated to be background therapy for obesity and type 2 diabetes, until clinical data support use in MASH[22](index=22&type=chunk) [Denifanstat Clinical Data in MASH (FASCINATE-2)](index=11&type=section&id=Denifanstat%20Clinical%20Data%20in%20MASH%20(FASCINATE-2)) The FASCINATE-2 Phase 2b trial demonstrated denifanstat's efficacy and safety in MASH, meeting primary and secondary endpoints related to MASH resolution and fibrosis improvement, including in cirrhotic patients, alongside positive impacts on liver fat, enzymes, and cardiometabolic health [FASCINATE-2 Trial Design and Baseline](index=12&type=section&id=FASCINATE-2%20Trial%20Design%20and%20Baseline) - The FASCINATE-2 Phase 2b trial was a 52-week, double-blind study in **168** biopsy-confirmed F2-F3 MASH patients, randomized 2:1 to 50mg denifanstat or placebo[28](index=28&type=chunk) - Primary endpoints included MASH resolution without worsening of fibrosis and NAS ≥ 2 points improvement without worsening of fibrosis[26](index=26&type=chunk)[28](index=28&type=chunk) | Parameter | Placebo, n=45 | Denifanstat, n=81 | | :-------- | :------------ | :---------------- | | Age, years | 59.6 (+/- 10.9) | 56.1 (+/- 10.8) | | Sex, female | 27 (60%) | 48 (59%) | | BMI, kg/m2 | 36.5 (+/-6.7) | 34.6 (+/- 6.1) | | Type 2 diabetes | 27 (60%) | 55 (68%) | | Liver Fat Content (MRI-PDFF), % | 19.0 (+/-7.0) | 16.6 (+/- 7.1) | | Baseline liver biopsy NAS ≥ 5 | 34 (76%) | 63 (78%) | | Baseline liver biopsy F2/F3 | 22 (49%) / 23 (51%) | 34 (42%) / 47 (58%) | [Primary Endpoints: Liver Biopsy](index=14&type=section&id=Primary%20Endpoints%3A%20Liver%20Biopsy) - Denifanstat achieved statistical significance at Week 52 for both primary endpoints in the FASCINATE-2 trial[30](index=30&type=chunk) | Endpoint | Placebo (n=56) | Denifanstat (n=112) | p-value | | :------- | :------------- | :------------------ | :------ | | MASH resolution w/o worsening of fibrosis | **16%** | **38%** | 0.0003 | | NAS ≥ 2 points improvement w/o worsening of fibrosis | **20%** | **52%** | 0.0035 | [Secondary Endpoints: Liver Fibrosis and MASH Resolution](index=15&type=section&id=Secondary%20Endpoints%3A%20Liver%20Fibrosis%20and%20MASH%20Resolution) - Denifanstat achieved statistically significant improvement in liver fibrosis (≥1 stage improvement without worsening of MASH) and MASH resolution without worsening of fibrosis at Week 52[34](index=34&type=chunk)[35](index=35&type=chunk) | Endpoint | Placebo (n=45) | Denifanstat (n=81) | p-value | | :------- | :------------- | :----------------- | :------ | | Improvement in liver fibrosis ≥ 1 stage & no worsening of MASH | **18%** | **41%** | 0.0102 | | Resolution of MASH & no worsening of fibrosis | **16%** | **38%** | 0.0173 | | Fibrosis Endpoints | Placebo | Denifanstat | | :----------------- | :------ | :---------- | | ≥1 stage improvement in fibrosis w/o worsening of MASH | **18%** | **41%** | | >2 stage improvement in fibrosis w/o worsening of MASH | **2%** | **10%** | | Progression to cirrhosis (F4) | **11%** | **2%** | [Digital Pathology Fibrosis Analysis](index=17&type=section&id=Digital%20Pathology%20Fibrosis%20Analysis) - AI-based digital pathology (qFibrosis) showed that denifanstat significantly reduced fibrosis in MASH patients[38](index=38&type=chunk)[39](index=39&type=chunk) - Denifanstat improved fibrosis in periportal and portal zones, parameters correlated with liver outcomes and mortality[40](index=40&type=chunk)[41](index=41&type=chunk)[42](index=42&type=chunk) [Denifanstat Potential in Cirrhotic (F4) Patients](index=19&type=section&id=Denifanstat%20Potential%20in%20Cirrhotic%20(F4)%20Patients) - In vitro data suggests denifanstat reduces pro-fibrotic signaling in stellate cells, indicating potential to remove fibrotic scar tissue and reestablish ECM scaffold even in cirrhotic (F4) patients[49](index=49&type=chunk) - **85% (11/13)** of qF4 patients at baseline on denifanstat showed 1 to 2-stage fibrosis regression based on AI-based digital pathology[50](index=50&type=chunk)[51](index=51&type=chunk) - A potential Phase 2 proof of concept study in F4 patients is the next step[46](index=46&type=chunk) [Safety Profile](index=21&type=section&id=Safety%20Profile) - Denifanstat was generally well-tolerated in the FASCINATE-2 trial[53](index=53&type=chunk) | Event n (%) | Placebo (n=56) | Denifanstat 50mg (n=112) | | :----------------------------------- | :------------- | :----------------------- | | Any adverse event (AE) | 46 (82.1) | 99 (88.4) | | Adverse event related to denifanstat or placebo | 20 (35.7) | 51 (45.5) | | Serious adverse event | 3 (5.4) | 13 (11.6) | | TEAE leading to study drug discontinuation | 3 (5.4) | 22 (19.6) | | COVID-19 | 6 (10.7) | 19 (17.0) | | Dry eye | 8 (14.3) | 10 (8.9) | | Hair thinning | 2 (3.6) | 21 (18.8) | - Hair thinning, the most common AE, stabilized with a 2-to-4 week dose pause and then reversed with down titration or study discontinuation, with only **7%** of patients discontinuing due to this AE[53](index=53&type=chunk) - No DILI (drug-induced liver injury) signal and no muscle wasting were detected, and GI (gastrointestinal) effects were mild[53](index=53&type=chunk) [Liver Fat and Enzymes](index=22&type=section&id=Liver%20Fat%20and%20Enzymes) - Denifanstat achieved a statistically significant **65% relative reduction** in liver fat (MRI-PDFF) at Week 52 (p<0.0001)[54](index=54&type=chunk)[56](index=56&type=chunk) - Denifanstat significantly decreased ALT and AST levels from baseline at Week 26 and Week 52[57](index=57&type=chunk)[58](index=58&type=chunk) [Cardiometabolic Health](index=24&type=section&id=Cardiometabolic%20Health) - Denifanstat decreased LDL-c levels and increased polyunsaturated triglycerides at Week 52, indicating positive effects on cardiometabolic health[59](index=59&type=chunk)[60](index=60&type=chunk) [De Novo Lipogenesis Reduction](index=25&type=section&id=De%20Novo%20Lipogenesis%20Reduction) - Denifanstat significantly reduced de novo lipogenesis (DNL) as evidenced by a decrease in tripalmitin levels at Week 4 (p=0.005) and Week 13 (p=0.001)[62](index=62&type=chunk)[63](index=63&type=chunk)[67](index=67&type=chunk) [Precision Medicine](index=26&type=section&id=Precision%20Medicine) - Sagimet is exploring precision medicine approaches for MASH using blood tests to identify drug responders (via tripalmitin) and potential predictive markers (a signature of 6 blood metabolites) to match patients with appropriate treatments[68](index=68&type=chunk)[71](index=71&type=chunk) [Combination Therapy Development for MASH](index=27&type=section&id=Combination%20Therapy%20Development%20for%20MASH) Sagimet is actively developing combination therapies for MASH, leveraging preclinical data showing synergistic effects of FASN inhibitors with other agents, and planning clinical trials for denifanstat in combination with resmetirom, particularly for advanced MASH patients [Preclinical Combination Data](index=28&type=section&id=Preclinical%20Combination%20Data) - In a MASH mouse model, combination treatment with a FASN inhibitor (TVB-3664) and semaglutide showed additive effects on liver fat, a direct impact on stellate cells, and a synergistic effect on NAS reduction[73](index=73&type=chunk)[76](index=76&type=chunk) [Denifanstat with GLP1-RA](index=29&type=section&id=Denifanstat%20with%20GLP1-RA) | Endpoint | Placebo + GLP1 (n=4) | Denifanstat + GLP1 (n=12) | p-value | | :------- | :------------------- | :------------------------ | :------ | | Resolution of MASH w/o worsening of fibrosis | **0%** | **42%** | 0.103 | | Improvement in liver fibrosis ≥ 1 stage w/o worsening of MASH | **0%** | **42%** | 0.103 | - In a subset of FASCINATE-2 patients on stable GLP1-RA at baseline, denifanstat improved MASH resolution and fibrosis without worsening of fibrosis[78](index=78&type=chunk)[79](index=79&type=chunk) - AI digital pathology results also support fibrosis improvement in GLP1-RA patients treated with denifanstat[79](index=79&type=chunk) [Mechanism of Action Supports Combination](index=30&type=section&id=Mechanism%20of%20Action%20Supports%20Combination) - The distinct and complementary mechanisms of denifanstat (decreasing de novo lipogenesis) and fat oxidizers like THR-beta agonists (increasing mitochondrial beta-oxidation) support synergistic effects[80](index=80&type=chunk)[82](index=82&type=chunk)[83](index=83&type=chunk) - There is an opportunity for fixed-dose combinations with other oral medications[83](index=83&type=chunk) [Benefits of Denifanstat/Resmetirom Combination](index=31&type=section&id=Benefits%20of%20Denifanstat%2FResmetirom%20Combination) | Characteristic | Denifanstat | Resmetirom | | :------------- | :---------- | :--------- | | Mechanism | Direct - decreases de novo lipogenesis, fibrogenesis in stellate cells, liver fat and lipotoxicity | Direct - increases fatty acid oxidation; Indirect - decreases fibrosis due to decreased liver fat and lipotoxicity | | Formulation | Oral | Oral | | Dosing | Once daily | Once daily | | Clinical Data | Met both primary endpoints in Phase 2b trial with significant reduction in fibrosis | Phase 3 data supported FDA approval for treatment of non-cirrhotic MASH | - A combination product could potentially offer an opportunity to serve patients with the strongest need for treatment, including those with stage 4 fibrosis[84](index=84&type=chunk) [Clinical Development Program](index=32&type=section&id=Clinical%20Development%20Program) - A Phase 1 PK study for denifanstat and resmetirom is planned to start in 2H 2025 to evaluate drug interactions, safety, tolerability, and confirm optimal combination dose levels[86](index=86&type=chunk)[87](index=87&type=chunk) - This will be followed by a Phase 2 clinical combination study with denifanstat and resmetirom in F4 MASH patients, with liver biopsies as the primary endpoint[86](index=86&type=chunk)[87](index=87&type=chunk) [Attractiveness of Combination Therapy](index=33&type=section&id=Attractiveness%20of%20Combination%20Therapy) - Denifanstat directly targets the three key drivers of MASH (liver fat, inflammation, and fibrosis), with successful Phase 2b outcomes[88](index=88&type=chunk) - Pre-clinical data demonstrated a synergistic effect of combination of FASN inhibitor and resmetirom[88](index=88&type=chunk) - IP for the combination of denifanstat and resmetirom, if granted, extends to **2044** with potential PTE to **2048**[88](index=88&type=chunk) - The combination offers potential for an oral, once-daily product to address an unmet need in MASH advanced patients (F4)[88](index=88&type=chunk) [Acne](index=34&type=section&id=Acne) This section covers the role of FASN in acne, market overview, treatment algorithms, clinical data for denifanstat, and the development of TVB-3567 [FASN Role in Acne](index=34&type=section&id=FASN%20Role%20in%20Acne) FASN plays a critical role in acne pathogenesis by contributing to increased sebum production, with 80% of lipids produced through de novo lipogenesis (DNL). This makes FASN inhibitors an attractive therapeutic target, also offering potential to reduce inflammation - FASN is integral to acne pathogenesis, contributing to increased sebum in sebaceous glands, with **80%** of lipids produced through DNL[92](index=92&type=chunk)[95](index=95&type=chunk) - FASN inhibition has the potential to reduce inflammation by decreasing cytokine secretion and Th17 activation[95](index=95&type=chunk) [Acne Market Overview](index=37&type=section&id=Acne%20Market%20Overview) The global acne market is projected to reach $17 billion in the next decade, with a significant number of US patients seeking dermatologist treatment. Dermatologists are open to new therapies for acne, which often requires chronic management, especially for the 70% of patients with moderate to severe disease - The global acne market is expected to reach **$17 billion** in the next decade[96](index=96&type=chunk)[97](index=97&type=chunk) - **5.1 million** US acne patients are treated by dermatologists annually, with approximately **70%** of patients presenting with moderate to severe disease[97](index=97&type=chunk)[98](index=98&type=chunk) - Dermatologists are open to new therapies for acne, as most patients require chronic management[98](index=98&type=chunk) [Acne Treatment Algorithm](index=38&type=section&id=Acne%20Treatment%20Algorithm) Acne treatment strategies vary by disease severity, ranging from topical agents for mild cases to the addition of oral products like antibiotics or hormonal contraceptives for moderate to severe disease, and isotretinoin for severe cases | Disease Severity | Treatment Approach | Main Therapy Categories | | :--------------- | :----------------- | :---------------------- | | Mild Disease | Treatment includes topical agents used as mono-therapy, combination therapy, or with fixed dosed combination products | Retinoids, Benzoyl Peroxide, Antibiotics, Clascoterone, Salicylic Acid, Azelaic Acid | | Moderate to Severe Disease | Treatment approach adds oral products on top of the topical agents | Oral Antibiotics (tetracyclines, sarecycline), Hormonal contraceptives, Spironolactone (off-label), Intralesional corticosteroids | | Severe Disease | | Isotretinoin | [Denifanstat Clinical Data in Acne](index=39&type=section&id=Denifanstat%20Clinical%20Data%20in%20Acne) Clinical trials for denifanstat in acne have demonstrated significant sebum reduction in Phase 1 studies and positive efficacy and safety outcomes in a Phase 3 trial conducted by Ascletis in China, meeting all primary and secondary endpoints [Phase 1 Sebum Reduction Data](index=39&type=section&id=Phase%201%20Sebum%20Reduction%20Data) - Multiple Phase 1 trials demonstrated that FASN inhibitors, including denifanstat, significantly decreased DNL sebum lipids, showing a **>90% reduction** by day 15[100](index=100&type=chunk)[103](index=103&type=chunk) - The reduced level of sebum lipids was maintained through the entire study and demonstrated a dose-responsive impact[103](index=103&type=chunk) [Ascletis Phase 3 Clinical Trial Design](index=40&type=section&id=Ascletis%20Phase%203%20Clinical%20Trial%20Design) - Ascletis conducted a double-blind, randomized, placebo-controlled Phase 3 trial of denifanstat (50mg once daily) in **480 patients** with moderate to severe acne in China[104](index=104&type=chunk)[105](index=105&type=chunk) - Primary endpoints at week 12 included the percentage of patients achieving IGA success (defined as at least a 2-point reduction in IGA from baseline to 0 or 1) and the percentage change of total lesion counts from baseline[106](index=106&type=chunk)[108](index=108&type=chunk) [Ascletis Phase 3 Efficacy Results](index=41&type=section&id=Ascletis%20Phase%203%20Efficacy%20Results) - In the Ascletis Phase 3 trial, denifanstat met all primary and secondary endpoints for moderate to severe acne vulgaris in China[109](index=109&type=chunk)[120](index=120&type=chunk) | Efficacy Endpoint | 50mg denifanstat (n=240) | Placebo (n=240) | | :------------------------------------------ | :----------------------- | :-------------- | | % Treatment success [IGA] (primary endpoint) | **33.2** | **14.6** | | % Change in total lesion count (primary endpoint) | **-57.4** | **-35.4** | | % Change in inflammatory lesion count (primary endpoint) | **-63.5** | **-43.2** | | % Change in non-inflammatory lesion count (key secondary endpoint) | **-51.9** | **-28.9** | [Ascletis Phase 3 Safety Data](index=42&type=section&id=Ascletis%20Phase%203%20Safety%20Data) - Denifanstat 50mg was generally well-tolerated during the 12-week Ascletis Phase 3 study, with comparable TEAE incidence rates to placebo[111](index=111&type=chunk)[113](index=113&type=chunk) - The most common TEAEs were dry skin (**6.3%** vs **2.9%** placebo) and dry eye (**5.9%** vs **3.8%** placebo)[113](index=113&type=chunk) - All denifanstat-related AEs were mild or moderate, with no grade 3 or 4 AEs, serious AEs, or deaths reported[113](index=113&type=chunk) [TVB-3567 Development in Acne](index=43&type=section&id=TVB-3567%20Development%20in%20Acne) Sagimet initiated a Phase 1 clinical trial for its second FASN inhibitor, TVB-3567, in June 2025, aiming to confirm its profile and optimal doses for a subsequent Phase 2 trial in moderate to severe acne patients, leveraging the novel mechanism of action and large market opportunity [TVB-3567 Phase 1 Clinical Trial](index=43&type=section&id=TVB-3567%20Phase%201%20Clinical%20Trial) - A first-in-human Phase 1 clinical trial for TVB-3567 was initiated in June 2025[114](index=114&type=chunk) - The trial is a double-blind, randomized, placebo-controlled study assessing the safety, tolerability, pharmacokinetics (PK), and pharmacodynamics (PD), including sebum analysis, of single and multiple ascending doses in healthy and acne patients[114](index=114&type=chunk) | PART | DESIGN | PLANNED of PARTICIPANTS | | :--- | :----- | :------------------------ | | A | SAD | ~56 | | B | Food effect | ~12 | | C | MAD | ~32 | | D | MAD/ACNE | ~28 | [Clinical Development Program](index=44&type=section&id=Clinical%20Development%20Program) - Sagimet's goal is to initiate a Phase 2 trial for TVB-3567 in moderate to severe acne patients in 2026, subject to regulatory consultation and the outcome of the Phase 1 trial[117](index=117&type=chunk)[119](index=119&type=chunk) - Phase 1 will confirm the PK and PD profile, assess safety/tolerability, and confirm potential doses for an acne Phase 2 trial[119](index=119&type=chunk) [Attractiveness of TVB-3567 in Acne](index=45&type=section&id=Attractiveness%20of%20TVB-3567%20in%20Acne) - Oral FASN inhibitors offer a novel mechanism of action for the potential treatment of moderate to severe acne[120](index=120&type=chunk) - Denifanstat met all primary and secondary endpoints in its Phase 3 clinical trial for moderate to severe acne vulgaris in China and was generally well-tolerated[120](index=120&type=chunk) - The acne market in dermatology is large (**>50 million** people in the US), with a significant portion of patients potentially benefiting from an oral FASN inhibitor[120](index=120&type=chunk) | Category | Detail | Expiration/Status | | :------- | :----- | :---------------- | | Method of use application for TVB-3567 for acne | Filed | 2025 (if granted, 2045; potential PTE to 2048) | | Composition of matter patent | Patent | 2035 (potential PTE to 2038) | [Oncology](index=46&type=section&id=Oncology) This section outlines the critical role of FASN in oncology, focusing on specific FASN-dependent tumor types and Sagimet's ongoing clinical programs [FASN Role in Oncology](index=46&type=section&id=FASN%20Role%20in%20Oncology) FASN is critical for tumor cell proliferation and survival by providing essential lipids and preventing stress-induced death. Certain cancers, particularly those with specific oncogenic drivers like KRAS mutations, are FASN-dependent, making FASN inhibition a promising strategy to target tumor cells and overcome drug resistance - FASN is integral to tumor cell proliferation and survival, providing lipids for membrane synthesis, intracellular signaling, and protein modification[122](index=122&type=chunk)[125](index=125&type=chunk) - Certain cancers, especially those with specific oncogenic drivers (e.g., KRAS mutant), are FASN-dependent, making FASN inhibition a strategy to kill tumor cells and/or avoid drug resistance[125](index=125&type=chunk)[126](index=126&type=chunk) - In a foundational Phase 1 study, KRAS mutant NSCLC patients on denifanstat had significantly longer duration on study than KRAS wild type patients (p<0.02), with **91%** achieving stable disease[126](index=126&type=chunk) [Cancer Program Focus](index=49&type=section&id=Cancer%20Program%20Focus) Sagimet's oncology program targets four FASN-dependent tumor types: Glioblastoma (GBM) with an ongoing Phase 3 trial, Prostate cancer with an ongoing Phase 1, and Hepatocellular Carcinoma (HCC) and NSCLC KRAS mutant, both positioned as Phase 2-ready with supportive preclinical and clinical evidence | Type | Status | Details | | :--- | :----- | :------ | | GBM | Phase 3 ongoing | In China by Ascletis, denifanstat combination with bevacizumab; Phase 3 enrollment of **120 patients** achieved in 3Q2023 | | Prostate | Phase 1 ongoing | Investigator Sponsored at Weill Cornell, denifanstat combination with enzalutamide; Phase 1 results expected 4Q2025 | | HCC | Phase 2-ready | Preclinical and translational work completed; positive preclinical combination results | | NSCLC KRASM | Phase 2-ready | Preclinical and clinical evidence; positive preclinical combination with KRAS inhibitor; encouraging monotherapy Phase 1 results with denifanstat | [Conclusion](index=50&type=section&id=Conclusion) This section summarizes Sagimet's key achievements, highlighting the clinical success of denifanstat in MASH and acne, and the advancement of its FASN inhibitor pipeline [Sagimet at a Glance (Summary)](index=50&type=section&id=Sagimet%20at%20a%20Glance%20(Summary)) Sagimet's lead FASN inhibitor, denifanstat, has demonstrated strong clinical proof-of-concept in MASH (Phase 2b met primary endpoints, combination with resmetirom in Phase 1 2H 2025) and acne (Phase 3 success in China). The follow-on FASN inhibitor, TVB-3567, initiated Phase 1 for acne in June 2025 - Denifanstat, a novel fatty acid synthase (FASN) inhibitor, has a differentiated MOA with potential to target multiple underserved diseases, showing strong clinical data and proof of concept[130](index=130&type=chunk) - Denifanstat successfully completed a Phase 2b trial for MASH, meeting both primary endpoints with significant reduction in fibrosis, and a Phase 1 clinical trial for combination with resmetirom is planned for 2H 2025[130](index=130&type=chunk) - TVB-3567, Sagimet's follow-on FASN inhibitor, received IND clearance in March 2025 and initiated a first-in-human Phase 1 clinical trial for acne in June 2025[130](index=130&type=chunk)

[FORM 10-Q Filing Information](index=1&type=section&id=FORM%2010-Q) [Registrant Information](index=1&type=section&id=Registrant%20Information) This section details Sagimet Biosciences Inc.'s Form 10-Q filing, including incorporation, SEC status, and stock information for Q2 2025 - The report is a Quarterly Report on Form 10-Q for the period ended June 30, 2025[2](index=2&type=chunk) - Sagimet Biosciences Inc. is incorporated in Delaware, headquartered in San Mateo, California[2](index=2&type=chunk)[6](index=6&type=chunk) Securities Registered | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :------------------------------ | :---------------- | :---------------------------------------- | | Series A Common Stock, $0.0001 par value per share | SGMT | Nasdaq Global Market | - The registrant is classified as a **Non-accelerated filer**, **Smaller reporting company**, and **Emerging growth company**[5](index=5&type=chunk) - Outstanding shares at August 5, 2025: Series A common stock: **31,001,109**; Series B common stock: **1,520,490**[5](index=5&type=chunk) [Table of Contents](index=2&type=section&id=Table%20of%20Contents) [Forward-Looking Statements](index=3&type=section&id=FORWARD-LOOKING%20STATEMENTS) [Nature of Forward-Looking Statements](index=3&type=section&id=Nature%20of%20Forward-Looking%20Statements) The report contains forward-looking statements on future operations, financial position, and drug candidates, subject to risks and uncertainties - The report includes forward-looking statements about future results, financial position, business strategy, drug candidates, preclinical studies, clinical trials, R&D costs, regulatory approvals, and management plans[10](index=10&type=chunk) - These statements involve known and unknown risks, uncertainties, and other important factors that may cause actual results to differ materially from those expressed or implied[10](index=10&type=chunk) [Key Areas of Forward-Looking Statements](index=3&type=section&id=Key%20Areas%20of%20Forward-Looking%20Statements) Forward-looking statements cover financial performance, funding, drug development (denifanstat, TVB-3567), regulatory approvals, and IP - Financial performance and ability to obtain additional cash[11](index=11&type=chunk)[14](index=14&type=chunk) - Scope, progress, results, and costs of developing denifanstat, TVB-3567, and other drug candidates[11](index=11&type=chunk)[14](index=14&type=chunk) - Timing and costs for regulatory approval and special designations[11](index=11&type=chunk)[14](index=14&type=chunk) - Plans for commercializing drug candidates, if approved[11](index=11&type=chunk)[14](index=14&type=chunk) - Ability to obtain sufficient funding or strategic collaboration for Phase 3 clinical trials for denifanstat in MASH[11](index=11&type=chunk)[14](index=14&type=chunk) - Expectations regarding intellectual property protection and the impact of macroeconomic conditions[11](index=11&type=chunk)[14](index=14&type=chunk) [PART I - FINANCIAL INFORMATION](index=7&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Item 1. Condensed Financial Statements](index=7&type=section&id=Item%201.%20Condensed%20Financial%20Statements) Presents unaudited condensed financial statements, including balance sheets, statements of operations, equity, cash flows, and related notes [Condensed Balance Sheets (unaudited)](index=7&type=section&id=Condensed%20Balance%20Sheets%20(unaudited)) Total assets and stockholders' equity decreased from December 31, 2024, to June 30, 2025, mainly due to reduced cash Condensed Balance Sheet Highlights (in thousands) | Item | June 30, 2025 | December 31, 2024 | | :------------------------ | :------------ | :---------------- | | Cash and cash equivalents | $42,327 | $75,840 | | Total current assets | $127,196 | $152,774 | | Total assets | $137,407 | $160,259 | | Total current liabilities | $7,247 | $4,454 | | Total stockholders' equity| $130,160 | $155,805 | - Accumulated deficit increased from **$295.3 million** at December 31, 2024, to **$323.9 million** at June 30, 2025, reflecting ongoing losses[16](index=16&type=chunk) [Condensed Statements of Operations and Comprehensive Loss (unaudited)](index=8&type=section&id=Condensed%20Statements%20of%20Operations%20and%20Comprehensive%20Loss%20(unaudited)) Net losses increased for Q2 and H1 2025 versus 2024, driven by higher operating expenses, especially in R&D Net Loss and Operating Expenses (in thousands) | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Research and development | $7,248 | $6,313 | $22,590 | $11,575 | | General and administrative| $4,677 | $4,276 | $9,200 | $7,782 | | Total operating expenses | $11,925 | $10,589 | $31,790 | $19,357 | | Net loss | $(10,386) | $(8,118) | $(28,562) | $(14,747) | | Net loss per share (basic and diluted) | $(0.32) | $(0.25) | $(0.89) | $(0.48) | - Net loss increased by **28%** for the three months ended June 30, 2025, and by **94%** for the six months ended June 30, 2025, compared to the prior year periods[20](index=20&type=chunk) [Condensed Statements of Stockholders' Equity (unaudited)](index=9&type=section&id=Condensed%20Statements%20of%20Stockholders'%20Equity%20(unaudited)) Stockholders' equity decreased from **$155.8 million** to **$130.2 million** due to net losses, partially offset by stock-based compensation Stockholders' Equity Changes (in thousands) | Item | January 1, 2025 | March 31, 2025 | June 30, 2025 | | :--------------------------------- | :-------------- | :------------- | :------------ | | Total Stockholders' Equity | $155,805 | $138,992 | $130,160 | | Net loss (Q1 2025) | | $(18,176) | | | Net loss (Q2 2025) | | | $(10,386) | | Stock-based compensation expense (Q1 2025) | | $1,472 | | | Stock-based compensation expense (Q2 2025) | | | $1,598 | [Condensed Statements of Cash Flows (unaudited)](index=10&type=section&id=Condensed%20Statements%20of%20Cash%20Flows%20(unaudited)) Net cash and equivalents decreased significantly in H1 2025 due to increased operating and investing cash usage, unlike prior year Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(23,637) | $(11,842) | | Net cash used in investing activities | $(9,877) | $(72,157) | | Net cash provided by financing activities | $1 | $104,819 | | Net (decrease) increase in cash and cash equivalents | $(33,513) | $20,820 | | Cash and cash equivalents at end of period | $42,327 | $95,959 | - Net cash used in operating activities increased by approximately **99%** year-over-year for the six months ended June 30, 2025, driven by clinical development and manufacturing costs[25](index=25&type=chunk)[126](index=126&type=chunk) - Financing activities provided minimal cash in 2025 (**$1 thousand**) compared to **$104.8 million** in 2024, which included proceeds from a follow-on offering[25](index=25&type=chunk)[129](index=129&type=chunk)[130](index=130&type=chunk) [Notes to Condensed Financial Statements (unaudited)](index=11&type=section&id=Notes%20to%20Condensed%20Financial%20Statements%20(unaudited)) Notes provide context for financial statements, covering business, accounting policies, liquidity, fair value, and commitments [1. Description of Business and Basis of Presentation](index=11&type=section&id=1.%20Description%20of%20Business%20and%20Basis%20of%20Presentation) Sagimet Biosciences develops FASN inhibitors for metabolic and fibrotic diseases, with lead candidate denifanstat in MASH, acne, and cancer - Sagimet Biosciences Inc. is a clinical-stage biopharmaceutical company developing fatty acid synthase (FASN) inhibitors[27](index=27&type=chunk) - Denifanstat, the lead drug candidate, is in development for MASH (**Breakthrough Therapy designation**), acne (met all primary and secondary endpoints in Phase 3 trial by partner Ascletis), and select forms of cancer[27](index=27&type=chunk)[90](index=90&type=chunk)[95](index=95&type=chunk) - TVB-3567, a second FASN inhibitor, initiated a first-in-human Phase 1 clinical trial for acne in June 2025[27](index=27&type=chunk)[98](index=98&type=chunk) - The company had an accumulated deficit of **$323.9 million** and cash, cash equivalents, and marketable securities of **$135.5 million** as of June 30, 2025[32](index=32&type=chunk) - Existing cash, cash equivalents, and marketable securities are expected to fund operating expenses for at least the next **12 months**, but substantial additional capital will be required[35](index=35&type=chunk) [2. Significant Accounting Policies](index=13&type=section&id=2.%20Significant%20Accounting%20Policies) Outlines significant accounting policies, including net loss per share calculation and new pronouncements, with no material changes since last annual report - No material changes to significant accounting policies since December 31, 2024[36](index=36&type=chunk) - Basic and diluted net loss per share are the same due to net losses, making potentially dilutive securities anti-dilutive[37](index=37&type=chunk) Potentially Dilutive Securities Excluded from Diluted EPS (in thousands) | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Options to purchase Series A common stock | 5,738,868 | 4,464,067 | 5,738,868 | 4,464,067 | | Warrant to purchase Series A common stock | 1,000 | 1,000 | 1,000 | 1,000 | | Restricted stock units | 1,098,399 | 1,125,840 | 1,098,399 | 1,125,840 | | Total | 6,838,267 | 5,590,907 | 6,838,267 | 5,590,907 | - The company is evaluating the impact of ASU 2024-03 (Expense Disaggregation Disclosures) and ASU 2023-09 (Improvements to Income Tax Disclosures), with ASU 2023-09 to be adopted for the 2025 Annual Report on Form 10-K[40](index=40&type=chunk)[41](index=41&type=chunk) [3. Fair Value Measurements and Fair Value of Financial Instruments](index=14&type=section&id=3.%20Fair%20Value%20Measurements%20and%20Fair%20Value%20of%20Financial%20Instruments) Details fair value measurements for cash equivalents and marketable securities (Level 1 and 2), with no recognized impairment losses - Financial assets measured at fair value include cash equivalents (**Level 1**) and marketable securities (**Level 2**)[45](index=45&type=chunk) Fair Value of Cash Equivalents and Marketable Securities (in thousands) | Item | June 30, 2025 | December 31, 2024 | | :--------------------------------- | :------------ | :---------------- | | Cash equivalents | $42,020 | $75,277 | | Short-term marketable securities | $83,080 | $75,410 | | Long-term marketable securities | $10,059 | $7,408 | | Total cash equivalents and marketable securities | $135,159 | $158,095 | - The company has not recognized any impairment or credit losses on its available-for-sale securities[46](index=46&type=chunk) [4. Prepaid Expenses and Other Current Assets](index=18&type=section&id=4.%20Prepaid%20Expenses%20and%20Other%20Current%20Assets) Prepaid expenses and other current assets increased from **$1.5 million** to **$1.8 million**, mainly due to higher prepaid R&D costs Prepaid Expenses and Other Current Assets (in thousands) | Item | June 30, 2025 | December 31, 2024 | | :---------------------------------- | :------------ | :---------------- | | Prepaid clinical costs | $312 | $436 | | Prepaid research and development costs | $581 | $48 | | Prepaid insurance | $103 | $577 | | Deferred financing costs | $620 | $306 | | Other | $1 | $5 | | Total prepaid expenses and other current assets | $1,789 | $1,524 | - Prepaid research and development costs saw a substantial increase from **$48 thousand** to **$581 thousand**[52](index=52&type=chunk) [5. Accrued Expenses and Other Current Liabilities](index=18&type=section&id=5.%20Accrued%20Expenses%20and%20Other%20Current%20Liabilities) Accrued expenses and other current liabilities significantly increased from **$2.95 million** to **$5.17 million**, driven by higher clinical and G&A costs Accrued Expenses and Other Current Liabilities (in thousands) | Item | June 30, 2025 | December 31, 2024 | | :---------------------------------- | :------------ | :---------------- | | Accrued payroll-related costs | $865 | $1,358 | | Accrued clinical costs | $2,268 | $528 | | Accrued research and development costs | $780 | $516 | | Accrued general and administrative costs | $1,260 | $544 | | Other | $1 | $5 | | Total accrued expenses and other current liabilities | $5,174 | $2,951 | - Accrued clinical costs increased over **four-fold** from **$528 thousand** to **$2.27 million**[53](index=53&type=chunk) [6. Commitments and Contingencies](index=18&type=section&id=6.%20Commitments%20and%20Contingencies) Details license agreement with Ascletis for denifanstat, facility lease amendments, and confirms no material legal proceedings or indemnification claims - The company has a license agreement with Ascletis BioScience Co. Ltd. (now Gannex Pharma Co., Ltd.) for denifanstat in Greater China[54](index=54&type=chunk)[57](index=57&type=chunk) - The company is eligible to receive up to **$122.0 million** in development and commercial milestone payments, plus tiered royalties on net sales in Greater China[55](index=55&type=chunk) - The facility lease agreement for its headquarters was amended in May 2025, extending the term through June 2026 and increasing the operating lease right-of-use asset and liability by **$0.2 million**[58](index=58&type=chunk) - The company is not party to any material legal proceedings as of June 30, 2025, and has not recorded liabilities for indemnification claims[60](index=60&type=chunk)[61](index=61&type=chunk) [7. Stock-Based Compensation](index=20&type=section&id=7.%20Stock-Based%20Compensation) Stock-based compensation expense increased in Q2 and H1 2025, under the 2023 Stock Option Plan and Inducement Pool Total Stock-Based Compensation Expense (in thousands) | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Stock options | $1,316 | $1,138 | $2,539 | $1,587 | | Restricted stock units | $282 | $311 | $531 | $621 | | Total stock-based compensation expense | $1,598 | $1,449 | $3,070 | $2,208 | - As of June 30, 2025, there was **$10.8 million** of unrecognized compensation expense for stock options, expected to be recognized over **2.4 years**[71](index=71&type=chunk) - Unrecognized compensation expense for unvested restricted stock units was **$2.8 million**, expected over **2.7 years**[73](index=73&type=chunk) - The 2023 Stock Option and Incentive Plan had **1,226,994 shares** automatically added on January 1, 2025, with **1,426,290 shares** available for future grant as of June 30, 2025[62](index=62&type=chunk) - The Inducement Pool increased by **300,000 shares** in February 2025, totaling **1,300,000 shares**, with **404,017 shares** available for future grants[65](index=65&type=chunk) [8. Related Party Transactions](index=25&type=section&id=8.%20Related%20Party%20Transactions) Discloses related party transactions, including the Ascletis license agreement, with **$0.1 million** in expenses recognized in H1 2024 - Jinzi J. Wu, Ph.D., former board member until June 2024, is the CEO of Ascletis, Gannex, and Ascletis Pharma, which are parties to the denifanstat license agreement[76](index=76&type=chunk) - The company recognized **$0.1 million** in research and development expenses under the Ascletis license agreement for the six months ended June 30, 2024[77](index=77&type=chunk) [9. Segment Reporting](index=25&type=section&id=9.%20Segment%20Reporting) The company operates as a single segment, focusing on FASN inhibitors for MASH and other diseases, with net loss as the performance metric - The company operates as one business segment: development and commercialization of FASN inhibitors for MASH and other diseases[78](index=78&type=chunk) - The Chief Operating Decision Maker (CODM) uses net loss to evaluate segment performance and total assets as the measure of segment assets[79](index=79&type=chunk) [10. Subsequent Events](index=25&type=section&id=10.%20Subsequent%20Events) Discloses the enactment of the One Big Beautiful Bill Act (OBBBA) on July 4, 2025, and its potential impact assessment - The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, with provisions effective from 2025 to 2027[81](index=81&type=chunk) - The company is assessing the potential impact of OBBBA on its deferred tax assets, financial statements, and disclosures[81](index=81&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition and operational results, highlighting drug candidate developments, operating expenses, liquidity, and capital resources [Overview](index=27&type=section&id=Overview) Sagimet Biosciences develops FASN inhibitors, with denifanstat showing positive Phase 2b MASH and Phase 3 acne results, and TVB-3567 advancing - Sagimet is a clinical-stage biopharmaceutical company developing FASN inhibitors for metabolic and fibrotic diseases[83](index=83&type=chunk) - Denifanstat met both primary and multiple secondary endpoints in the Phase 2b FASCINATE-2 clinical trial for MASH, demonstrating anti-fibrotic activity and MASH resolution[85](index=85&type=chunk)[87](index=87&type=chunk) - Denifanstat received FDA **Breakthrough Therapy designation** for non-cirrhotic MASH with moderate to advanced liver fibrosis in October 2024[90](index=90&type=chunk) - Ascletis announced denifanstat met all primary and secondary endpoints in its Phase 3 trial for moderate to severe acne vulgaris in China, with plans to submit for approval[95](index=95&type=chunk)[97](index=97&type=chunk)[101](index=101&type=chunk) - A first-in-human Phase 1 clinical trial for TVB-3567, a second FASN inhibitor for acne, was initiated in June 2025[98](index=98&type=chunk) - Preclinical data showed synergistic effects of denifanstat (via surrogate TVB-3664) and resmetirom in MASH mouse models, leading to a planned Phase 1 clinical trial for combination therapy[92](index=92&type=chunk)[94](index=94&type=chunk) [Components of Results of Operations](index=31&type=section&id=Components%20of%20results%20of%20operations) Defines key components of operations: R&D, G&A expenses, and other income, outlining their scope and future trends - Research and development expenses include internal personnel costs, external costs for preclinical studies, clinical trials, manufacturing, and professional services[100](index=100&type=chunk) - General and administrative expenses cover personnel, legal, accounting, auditing, consulting, insurance, and IT costs[104](index=104&type=chunk) - Other income primarily consists of interest income from cash, cash equivalents, and marketable securities, offset by accretion of discounts[106](index=106&type=chunk) - Both R&D and G&A expenses are expected to increase substantially in the foreseeable future due to advancing drug candidates, regulatory pursuits, and public company operations[103](index=103&type=chunk)[105](index=105&type=chunk) [Results of Operations](index=33&type=section&id=Results%20of%20operations) Net loss significantly increased in Q2 and H1 2025 due to higher R&D expenses for denifanstat and TVB-3567, increased G&A, and lower other income Operating Expenses and Net Loss (in thousands) | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Research and development | $7,248 | $6,313 | $22,590 | $11,575 | | General and administrative| $4,677 | $4,276 | $9,200 | $7,782 | | Total operating expenses | $11,925 | $10,589 | $31,790 | $19,357 | | Net loss | $(10,386) | $(8,118) | $(28,562) | $(14,747) | - Research and development expenses increased by **15%** for the three months and **95%** for the six months ended June 30, 2025, primarily due to clinical trial costs for denifanstat's Phase 3 MASH program and TVB-3567's Phase 1 trial[108](index=108&type=chunk)[112](index=112&type=chunk) - External R&D expenses for TVB-3567 increased dramatically by **9,140%** (3 months) and **14,700%** (6 months) due to the initiation of its Phase 1 clinical trial[109](index=109&type=chunk)[113](index=113&type=chunk) - Other income decreased by **$0.9 million** (3 months) and **$1.4 million** (6 months) due to a lower cash, cash equivalents, and marketable securities balance[110](index=110&type=chunk)[114](index=114&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20capital%20resources) Operations funded by **$190.9 million** from equity/debt; **$135.5 million** cash as of June 30, 2025, expected to last **12 months**, but substantial future capital is required - Since inception, operations have been financed primarily through public and private equity and debt financings, including **$190.9 million** net from IPO (July 2023) and follow-on offering (January 2024)[116](index=116&type=chunk) - As of June 30, 2025, cash, cash equivalents, and marketable securities totaled **$135.5 million**[118](index=118&type=chunk) - Existing capital is expected to fund operating expenses for at least the next **12 months** from the issuance of this report[125](index=125&type=chunk) - Future capital requirements are substantial and will depend on factors such as regulatory approval, clinical trial progress, manufacturing, and commercialization, requiring additional financing through equity, debt, or collaborations[118](index=118&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk) Cash Flows Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(23,637) | $(11,842) | | Net cash used in investing activities | $(9,877) | $(72,157) | | Net cash provided by financing activities | $1 | $104,819 | | Net (decrease) increase in cash and cash equivalents | $(33,513) | $20,820 | - The company is an **emerging growth company** and a **smaller reporting company**, allowing it to take advantage of certain exemptions from reporting requirements and accounting standards[133](index=133&type=chunk)[135](index=135&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) [Market Risk Disclosures](index=40&type=section&id=Market%20Risk%20Disclosures) As a smaller reporting company, Sagimet Biosciences Inc. is exempt from market risk disclosures - The company is a **smaller reporting company** and is not required to provide quantitative and qualitative disclosures about market risk[137](index=137&type=chunk) [Item 4. Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) [Disclosure Controls and Procedures](index=40&type=section&id=Disclosure%20controls%20and%20procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, ensuring timely and accurate reporting - Disclosure controls and procedures are designed to ensure information required for Exchange Act reports is recorded, processed, summarized, and reported timely[138](index=138&type=chunk) - As of June 30, 2025, the CEO and CFO concluded that disclosure controls and procedures were effective to provide reasonable assurance of timely and accurate information disclosure[140](index=140&type=chunk) [Changes in Internal Control Over Financial Reporting](index=42&type=section&id=Changes%20in%20internal%20control%20over%20financial%20reporting) No material changes occurred in the company's internal control over financial reporting during the quarter ended June 30, 2025 - No material changes in internal control over financial reporting occurred during the quarter ended June 30, 2025[141](index=141&type=chunk) [PART II - OTHER INFORMATION](index=42&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=42&type=section&id=Item%201.%20Legal%20Proceedings) The company is not involved in any legal proceedings expected to materially adversely affect its financial condition or operations - No claims or actions pending against the company are expected to have a material adverse effect on its results of operations, financial condition, or cash flows[142](index=142&type=chunk) [Item 1A. Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes in risk factors from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[143](index=143&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=42&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales or issuer purchases of equity securities occurred during the reporting period - No unregistered sales of equity securities occurred during the reporting period[144](index=144&type=chunk) - No issuer purchases of equity securities were made[145](index=145&type=chunk) [Item 3. Defaults Upon Senior Securities](index=42&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to the company - This item is not applicable[146](index=146&type=chunk) [Item 4. Mine Safety Disclosures](index=42&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable[147](index=147&type=chunk) [Item 5. Other Information](index=43&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q2 2025 - No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025[148](index=148&type=chunk) [Item 6. Exhibits](index=43&type=section&id=Item%206.%20Exhibits) Lists exhibits filed with Form 10-Q, including lease amendments, employment agreements, certifications, and XBRL documents - Exhibits include the third amendment to the Lease Agreement, second amended and restated executive employment agreements for key officers, and certifications (31.1, 31.2, 32.1)[149](index=149&type=chunk) - XBRL instance, schema, calculation, definition, and label linkbase documents are also filed[149](index=149&type=chunk) [Signatures](index=44&type=section&id=SIGNATURES) [Report Signatures](index=44&type=section&id=Report%20Signatures) The Quarterly Report was signed on August 13, 2025, by David Happel (CEO) and Thierry Chauche (CFO) - The Quarterly Report was signed on August 13, 2025[153](index=153&type=chunk) - Signed by David Happel, President and Chief Executive Officer, and Thierry Chauche, Chief Financial Officer[153](index=153&type=chunk)

Core Insights - Sagimet Biosciences has made significant progress in developing therapeutics for metabolic dysfunction associated steatohepatitis (MASH) and acne, with denifanstat meeting all primary and secondary endpoints in a Phase 3 clinical trial in China [2][5] - The company has initiated a Phase 1 clinical trial for TVB-3567, a new FASN inhibitor for acne treatment in the U.S., and plans to evaluate a combination of denifanstat and resmetirom in a Phase 1 trial in late 2025 [2][11] Recent Corporate Highlights - Denifanstat's Phase 3 trial in China involved 480 patients and demonstrated a treatment success rate of 33.2% compared to 14.6% for placebo, with significant reductions in total lesion count and inflammatory lesions [5] - The Phase 1 trial for TVB-3567 is designed to assess safety, tolerability, pharmacokinetics, and pharmacodynamics in healthy participants, including those with acne [4][11] Financial Results - As of June 30, 2025, the company reported cash and cash equivalents of $135.5 million, with research and development expenses of $7.2 million for the quarter, up from $6.3 million in the same period in 2024 [11][12] - The net loss for the three months ended June 30, 2025, was $10.4 million, compared to $8.1 million for the same period in 2024 [11][12] Industry Context - Acne affects over 50 million people annually in the U.S., and there has been limited innovation in treatment options over the past 40 years, highlighting the potential market opportunity for new therapies like denifanstat [4][14] - MASH is a progressive liver disease impacting over 115 million people globally, with only one recently approved treatment in the U.S., indicating a significant unmet medical need [13]