[Executive Summary & Corporate Update](index=1&type=section&id=Executive%20Summary%20%26%20Corporate%20Update) Spyre Therapeutics reported positive Phase 1 results, initiated Phase 2 trials, and maintains a strong financial position, with the CEO outlining a vision for reshaping immune-mediated disease treatments [Highlights of Q2 2025](index=1&type=section&id=Highlights%20of%20Q2%202025) Spyre Therapeutics reported positive interim Phase 1 results for two next-generation TL1A antibodies, initiated the Phase 2 SKYLINE-UC study, and is on track for Q3 initiation of the SKYWAY-RD basket study. The company also reported a strong cash position with an expected runway into the second half of 2028 - Positive interim Phase 1 results for two next-generation TL1A antibodies, demonstrating good tolerability, PK profiles supporting quarterly or biannual dosing, and **full TL1A engagement through up to 20 weeks**[1](index=1&type=chunk) - Initiated **Phase 2 SKYLINE-UC platform study** for ulcerative colitis (UC) and on track for **Q3 initiation of Phase 2 SKYWAY-RD basket study** for rheumatoid arthritis (RA), psoriatic arthritis (PsA), and axial spondyloarthritis (axSpA)[1](index=1&type=chunk) - On track to report interim Phase 1 data for SPY003 in **Q4 2025**, with **9 proof-of-concept readouts planned in 2026 & 2027** across IBD and rheumatic diseases[1](index=1&type=chunk) Cash, Cash Equivalents, and Marketable Securities | As of June 30, 2025 | Amount (in millions) | | :------------------ | :----- | | Cash, cash equivalents, and marketable securities | $526.6 | | Expected runway | into H2 2028 | [CEO's Strategic Vision](index=1&type=section&id=CEO%27s%20Strategic%20Vision) CEO Cameron Turtle emphasized Spyre's entry into a new chapter, aiming to reshape treatment paradigms for chronic immune-mediated diseases through its pipeline. The launch of SKYLINE-UC and upcoming SKYWAY-RD trials are key to identifying indication-leading products, with nine proof-of-concept readouts expected in the next two years, supported by robust science and a strong balance sheet - Spyre is entering a new chapter to explore its pipeline's potential to reshape treatment paradigms in chronic immune-mediated diseases[2](index=2&type=chunk) - The SKYLINE-UC and SKYWAY-RD trials are expected to generate **nine proof-of-concept readouts** in IBD and rheumatic conditions over the next two years[2](index=2&type=chunk) - The company is positioned to drive value for patients and investors, backed by robust science, a committed team, and a strong balance sheet with expected runway into the **second half of 2028**[2](index=2&type=chunk) [Development Pipeline Overview](index=1&type=section&id=Development%20Pipeline%20Overview) This section details Spyre's approach to developing next-generation therapies for IBD and immune-mediated diseases, including monotherapy and combination programs, with updates on Phase 2 clinical trials [Company Approach and Disease Focus](index=1&type=section&id=Company%20Approach%20and%20Disease%20Focus) Spyre Therapeutics employs best-in-class antibody engineering, dose optimization, and rational therapeutic combinations to maximize efficacy, safety, and convenience in treating Inflammatory Bowel Disease (IBD) and other immune-mediated diseases. The company targets chronic conditions like Ulcerative Colitis (UC), Crohn's Disease (CD), Rheumatoid Arthritis (RA), Psoriatic Arthritis (PsA), and axial Spondyloarthritis (axSpA), which affect millions in the U.S. and face issues of underdiagnosis and inadequate efficacy - Spyre's approach combines antibody engineering, dose optimization, and rational therapeutic combinations to maximize efficacy, safety, and convenience in IBD and other immune-mediated diseases[3](index=3&type=chunk) - IBD affects approximately **2.4 million individuals** in the U.S., while RA and PsA each affect over **1.5 million**, and axSpA affects nearly **3 million**, with underdiagnosis and inadequate efficacy being significant challenges[3](index=3&type=chunk)[4](index=4&type=chunk) - Monotherapy programs target validated mechanisms for safe and effective treatment of UC and CD with infrequent dosing, and the anti-TL1A program is also being studied in RA, PsA, and axSpA[4](index=4&type=chunk) [Monotherapy Programs](index=2&type=section&id=Monotherapy%20Programs) Spyre's pipeline includes three investigational monoclonal antibodies: SPY001 (targeting α4β7), SPY002/SPY072 (targeting TL1A), and SPY003 (targeting IL-23 p19 subunit). All are engineered with half-life extension technology and high concentration formulations to enable infrequent, subcutaneous maintenance dosing and maximize efficacy. SPY002 is for IBD, and SPY072 is for rheumatic diseases - Spyre's monotherapy programs include SPY001 (α4β7), SPY002/SPY072 (TL1A), and SPY003 (IL-23 p19), all designed for infrequent, subcutaneous maintenance dosing[5](index=5&type=chunk)[6](index=6&type=chunk)[7](index=7&type=chunk) - TL1A is considered one of the most promising targets in IBD and broader immunology, with SPY002 developed for IBD and SPY072 for rheumatic diseases[6](index=6&type=chunk) [SPY001 (α4β7)](index=2&type=section&id=SPY001%20%28%CE%B14%CE%B27%29) SPY001 is a highly potent and selective investigational monoclonal antibody targeting α4β7, engineered for extended half-life and high concentration to enable infrequent, subcutaneous maintenance dosing. Interim Phase 1 healthy volunteer data showed a favorable safety profile, a differentiated PK profile supporting potential Q3M or Q6M maintenance dosing, and rapid, complete saturation of α4β7 receptors. Based on these results, SPY001 advanced into the SKYLINE-UC Phase 2 trial in May 2025 - SPY001 is an α4β7 antibody engineered for extended half-life and high concentration, aiming for infrequent subcutaneous maintenance dosing[5](index=5&type=chunk) - Interim Phase 1 data for SPY001 demonstrated a favorable safety profile, PK profile supporting potential **Q3M or Q6M maintenance dosing**, and complete α4β7 receptor saturation[9](index=9&type=chunk) - SPY001 advanced into the **SKYLINE-UC Phase 2 platform trial**, which initiated in **May 2025**[9](index=9&type=chunk) [SPY002 & SPY072 (TL1A)](index=2&type=section&id=SPY002%20%26%20SPY072%20%28TL1A%29) SPY002 and SPY072 are highly potent and selective anti-TL1A monoclonal antibodies, designed with half-life extension and high concentration for infrequent, subcutaneous maintenance dosing. Interim Phase 1 healthy volunteer data showed favorable safety, differentiated PK profiles supporting potential Q3M or Q6M maintenance dosing, and complete suppression of free TL1A for up to 20 weeks. SPY002 is expected to advance to the SKYLINE-UC Phase 2 trial, and SPY072 to the SKYWAY-RD Phase 2 basket trial, both in Q3 2025 - SPY002 (for IBD) and SPY072 (for rheumatic diseases) are anti-TL1A antibodies engineered for extended half-life and high concentration, targeting infrequent subcutaneous maintenance dosing[6](index=6&type=chunk) - Interim Phase 1 data for SPY002 and SPY072 showed favorable safety, PK profiles supporting potential **Q3M or Q6M maintenance dosing**, and complete suppression of free TL1A[9](index=9&type=chunk) - SPY002 is expected to advance to **SKYLINE-UC Phase 2**, and SPY072 to **SKYWAY-RD Phase 2**, both in **Q3 2025**[9](index=9&type=chunk) [SPY003 (IL-23)](index=2&type=section&id=SPY003%20%28IL-23%29) SPY003 is a highly potent and selective investigational monoclonal antibody targeting the p19 subunit of IL-23, engineered for extended half-life and high concentration to enable infrequent, subcutaneous maintenance dosing. A first-in-human (FIH) trial was initiated in March 2025, with interim healthy volunteer data expected in Q4 2025. Preclinical data demonstrated comparable potency to risankizumab, a greater than three-fold longer pharmacokinetic half-life, and high selectivity for IL-23 - SPY003 targets the p19 subunit of IL-23, engineered for extended half-life and high concentration for infrequent subcutaneous maintenance dosing[7](index=7&type=chunk) - FIH trial for SPY003 initiated in **March 2025**, with interim healthy volunteer data expected in **Q4 2025**[9](index=9&type=chunk) - Preclinical data for SPY003 showed comparable potency to risankizumab, a **>3x longer PK half-life**, and high selectivity for IL-23[9](index=9&type=chunk) [Rational Combination Programs](index=2&type=section&id=Rational%20Combination%20Programs) Spyre plans to investigate combinations of its proprietary antibodies in nonclinical and clinical studies to achieve best-in-class efficacy in IBD with less frequent dosing. Preclinical data for SPY120 (TL1A + α4β7) demonstrated superiority over monotherapy in mouse models of colitis and no drug effects on PK in NHPs. Additionally, preclinical data for SPY130 and SPY230 (SPY003 in combination with SPY001 and SPY002, respectively) showed enhanced efficacy and pharmacodynamics. These combinations are expected to be included in Part B of the SKYLINE-UC trial - Spyre plans to investigate proprietary antibody combinations to achieve best-in-class efficacy in IBD with less frequent dosing[8](index=8&type=chunk) - Preclinical data for SPY120 (TL1A + α4β7) showed superiority over monotherapy in colitis models and no PK drug effects[8](index=8&type=chunk)[10](index=10&type=chunk) - Preclinical data for SPY130 and SPY230 (SPY003 + SPY001/SPY002) demonstrated enhanced efficacy and pharmacodynamics[16](index=16&type=chunk) - Rational combinations are expected to be included in **Part B of the SKYLINE-UC trial**[16](index=16&type=chunk) [Clinical Trial Updates](index=2&type=section&id=Clinical%20Trial%20Updates) Spyre is advancing its pipeline through two key Phase 2 platform trials: SKYLINE-UC for ulcerative colitis and SKYWAY-RD for rheumatic diseases. These trials are designed to efficiently generate proof-of-concept data for monotherapies and combinations - Spyre is conducting two key Phase 2 platform trials: **SKYLINE-UC** for UC and **SKYWAY-RD** for rheumatic diseases, aiming for efficient proof-of-concept data generation[2](index=2&type=chunk) [SKYLINE-UC Phase 2 Platform Trial](index=3&type=section&id=SKYLINE-UC%20Phase%202%20Platform%20Trial) The SKYLINE-UC Phase 2 induction and maintenance platform trial for moderately to severely active UC patients was initiated in May 2025. It evaluates SPY001, SPY002, SPY003, and pairwise combinations (six active investigational agents). Part A is an open-label assessment of monotherapy safety and preliminary efficacy, with induction data expected in 2026. Part B is a randomized, placebo-controlled assessment of monotherapies (two dose levels) and combinations, with induction data expected in 2027. Enrollment is currently underway for the SPY001 arm of Part A - SKYLINE-UC Phase 2 trial for UC initiated in **May 2025**, evaluating SPY001, SPY002, SPY003, and pairwise combinations[11](index=11&type=chunk) - Part A (open-label monotherapy) induction data expected in **2026**; Part B (randomized monotherapy/combination) induction data expected in **2027**[16](index=16&type=chunk) - The trial is currently enrolling subjects into the **SPY001 arm of Part A**[11](index=11&type=chunk) [SKYWAY-RD Phase 2 Basket Trial](index=3&type=section&id=SKYWAY-RD%20Phase%202%20Basket%20Trial) The SKYWAY-RD Phase 2 randomized and placebo-controlled basket trial for moderately to severely active RA, PsA, or axSpA patients is expected to initiate in Q3 2025. This trial will evaluate SPY072 across three sub-studies, each designed to provide proof-of-concept data in 2026. The RA sub-study will assess two dose levels of SPY072 at Week 12, while the PsA and axSpA sub-studies will each assess a single dose level of SPY072 at Week 16 - SKYWAY-RD Phase 2 basket trial for RA, PsA, or axSpA is expected to initiate in **Q3 2025**, evaluating SPY072[12](index=12&type=chunk) - The trial consists of three sub-studies (RA, PsA, axSpA), each expected to provide **proof-of-concept data in 2026**[12](index=12&type=chunk) - Sub-studies include RA (**two dose levels, Week 12 data**), PsA (**single dose, Week 16 data**), and axSpA (**single dose, Week 16 data**)[17](index=17&type=chunk) [Second Quarter 2025 Financial Results](index=3&type=section&id=Second%20Quarter%202025%20Financial%20Results) This section provides an overview of Spyre's financial performance for Q2 2025, highlighting cash position, operating expenses, other income, and net loss [Cash Position](index=3&type=section&id=Cash%20Position) As of June 30, 2025, Spyre held $526.6 million in cash, cash equivalents, and marketable securities, providing an expected operational runway into the second half of 2028. Net cash used in operating activities for Q2 2025 was $46.6 million Cash Position | Metric | Q2 2025 (in millions) | | :---------------------------------- | :---------- | | Cash, cash equivalents, and marketable securities | $526.6 | | Net cash used in operating activities | $46.6 | | Expected runway | into H2 2028 | Cash and Marketable Securities (in thousands) | Asset | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :------------------------ | :------------ | :---------------- | | Cash and cash equivalents | $81,659 | $89,423 | | Marketable securities | $444,921 | $513,665 | | **Total** | **$526,580** | **$603,088** | [Operating Expenses](index=3&type=section&id=Operating%20Expenses) Research and Development (R&D) expenses increased to $40.1 million in Q2 2025 from $32.6 million in Q2 2024, primarily due to higher clinical trial expenses and compensation costs, partially offset by lower early-stage R&D. General and Administrative (G&A) expenses remained relatively stable at $11.8 million in Q2 2025 compared to $11.5 million in Q2 2024 Operating Expenses (in thousands) | Expense Category | Q2 2025 (in thousands) | Q2 2024 (in thousands) | YoY Change | | :----------------------- | :------ | :------ | :--------- | | Research and development | $40,145 | $32,636 | +22.9% | | General and administrative | $11,790 | $11,511 | +2.4% | - Increase in R&D expenses was primarily driven by higher clinical trial expenses and increased compensation costs, partially offset by lower early-stage R&D activities[13](index=13&type=chunk) [Other Financial Items](index=3&type=section&id=Other%20Financial%20Items) Spyre recognized a $10.0 million gain in Q2 2025 from the sale of an in-process research and development asset, specifically related to a milestone achieved for pegzilarginase. Other income for Q2 2025 was $5.2 million, slightly down from $5.3 million in Q2 2024 Other Financial Items (in thousands) | Item | Q2 2025 (in thousands) | Q2 2024 (in thousands) | | :------------------------------------------ | :------ | :------ | | Gain on sale of in-process R&D asset | $(10,000) | $0 | | Other income (Interest income + Other (expense) income, net) | $5,218 | $5,310 | - The **$10.0 million gain** was due to achieved milestones related to the 2023 sale of pegzilarginase global rights to Immedica, driven by a favorable reimbursement decision in Europe[14](index=14&type=chunk) [Net Loss](index=3&type=section&id=Net%20Loss) Spyre reported a net loss of $36.7 million for Q2 2025, a slight improvement from the $38.8 million net loss in Q2 2024. This includes non-cash stock-based compensation expenses of $9.4 million and $8.7 million for Q2 2025 and Q2 2024, respectively Net Loss (in thousands) | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | YoY Change | | :-------------------------------- | :------ | :------ | :--------- | | Net loss | $(36,717) | $(38,837) | -5.5% | | Non-cash stock-based compensation | $9,400 | $8,700 | +8.0% | Net Loss Per Share (Common Stock) | Metric | Q2 2025 ($) | Q2 2024 ($) | YoY Change | | :-------------------------------- | :------ | :------ | :--------- | | Net loss per share, basic and diluted, common | $(0.49) | $(0.59) | -16.9% | [About Spyre Therapeutics](index=4&type=section&id=About%20Spyre%20Therapeutics) This section provides a concise overview of Spyre Therapeutics as a clinical-stage biotechnology company focused on developing next-generation products for IBD and other immune-mediated diseases [Company Overview](index=4&type=section&id=Company%20Overview) Spyre Therapeutics is a clinical-stage biotechnology company focused on developing next-generation products for inflammatory bowel disease (IBD) and other immune-mediated diseases. The company achieves this by combining best-in-class antibody engineering, dose optimization, and rational therapeutic combinations, with a pipeline of investigational extended half-life antibodies targeting α4β7, TL1A, and IL-23 - Spyre Therapeutics is a clinical-stage biotechnology company developing next-generation products for IBD and other immune-mediated diseases[18](index=18&type=chunk) - The company's approach involves best-in-class antibody engineering, dose optimization, and rational therapeutic combinations[18](index=18&type=chunk) - Spyre's pipeline includes investigational extended half-life antibodies targeting α4β7, TL1A, and IL-23[18](index=18&type=chunk) [Safe Harbor / Forward Looking Statements](index=4&type=section&id=Safe%20Harbor%20%2F%20Forward%20Looking%20Statements) This section contains standard disclaimers regarding forward-looking statements, emphasizing inherent risks and uncertainties in future projections [Disclaimer and Risk Factors](index=4&type=section&id=Disclaimer%20and%20Risk%20Factors) This section contains standard forward-looking statements regarding Spyre's future financial results, business strategy, clinical development activities, potential efficacy and safety of product candidates, and cash runway. It cautions readers that these statements are subject to risks, uncertainties, and assumptions, including regulatory feedback, clinical data consistency, macroeconomic conditions, and geopolitical instability, and that actual results may differ materially. The company disclaims any obligation to update these statements - The press release contains forward-looking statements regarding future financial position, business strategy, clinical development, and product candidate potential[20](index=20&type=chunk) - These statements are subject to risks and uncertainties, including regulatory feedback, potential inconsistencies in clinical data, macroeconomic conditions, and geopolitical instability[21](index=21&type=chunk)[22](index=22&type=chunk) - Readers should not rely on forward-looking statements as predictions of future events, and the company undertakes no obligation to update them except as required by law[23](index=23&type=chunk) [Contact Information](index=6&type=section&id=Contact%20Information) This section provides essential contact details for media and investor inquiries [Media and Investor Contacts](index=6&type=section&id=Media%20and%20Investor%20Contacts) This section provides contact details for media and investor inquiries - Contact information for media (Josie Butler, 1AB) and investors (Eric McIntyre) is provided[24](index=24&type=chunk) [Consolidated Financial Statements](index=7&type=section&id=Consolidated%20Financial%20Statements) This section presents Spyre's detailed financial statements, including balance sheets and statements of operations, for the specified periods [Consolidated Balance Sheets](index=7&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets show the company's financial position as of June 30, 2025, and December 31, 2024. Total assets decreased from $608.484 million at year-end 2024 to $538.832 million at Q2 2025, primarily due to a decrease in marketable securities. Total liabilities increased, mainly driven by a significant rise in CVR liability. Total stockholders' equity decreased from $517.804 million to $455.773 million Consolidated Balance Sheets (Selected Items, in thousands) | Item | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (in thousands) | | :-------------------------------- | :------------ | :---------------- | :----- | | **ASSETS** | | | | | Cash and cash equivalents | $81,659 | $89,423 | $(7,764) | | Marketable securities | $444,921 | $513,665 | $(68,744) | | Total current assets | $538,832 | $608,474 | $(69,642) | | **TOTAL ASSETS** | **$538,832** | **$608,484** | **$(69,652)** | | **LIABILITIES** | | | | | CVR liability (current) | $59,900 | $25,080 | $34,820 | | Non-current CVR liability | $0 | $36,620 | $(36,620) | | Total current liabilities | $83,059 | $54,060 | $28,999 | | **TOTAL LIABILITIES** | **$83,059** | **$90,680** | **$(7,621)** | | **STOCKHOLDERS' EQUITY** | | | | | Accumulated deficit | $(1,053,922) | $(972,432) | $(81,490) | | **TOTAL STOCKHOLDERS' EQUITY** | **$455,773** | **$517,804** | **$(62,031)** | - Total assets decreased by approximately **$69.7 million**, primarily due to a reduction in marketable securities[26](index=26&type=chunk) - Current CVR liability significantly increased from **$25.080 million to $59.900 million**, while non-current CVR liability became zero[26](index=26&type=chunk) - Accumulated deficit increased by **$81.490 million**, reflecting the net loss for the period[26](index=26&type=chunk) [Consolidated Statements of Operations](index=8&type=section&id=Consolidated%20Statements%20of%20Operations) The consolidated statements of operations detail the company's financial performance for the three and six months ended June 30, 2025, and 2024. For Q2 2025, the net loss was $36.7 million, an improvement from $38.8 million in Q2 2024. This was influenced by increased R&D expenses, a $10.0 million gain on the sale of an in-process R&D asset, and stable G&A and other income. For the six months ended June 30, 2025, the net loss was $81.5 million, slightly better than $82.7 million in the prior year period Consolidated Statements of Operations (Three Months Ended June 30, in thousands) | Item | 2025 (in thousands) | 2024 (in thousands) | YoY Change | | :------------------------------------------ | :------ | :------ | :--------- | | Research and development | $40,145 | $32,636 | +22.9% | | General and administrative | $11,790 | $11,511 | +2.4% | | Gain on sale of in-process R&D asset | $(10,000) | $0 | N/A | | Total operating expenses | $41,935 | $44,147 | -5.1% | | Loss from operations | $(41,935) | $(44,147) | -5.0% | | Total other income | $5,218 | $5,310 | -1.7% | | Net loss | $(36,717) | $(38,837) | -5.5% | | Net loss per share, common (basic and diluted) | $(0.49) | $(0.59) | -16.9% | Consolidated Statements of Operations (Six Months Ended June 30, in thousands) | Item | 2025 (in thousands) | 2024 (in thousands) | YoY Change | | :------------------------------------------ | :------ | :------ | :--------- | | Research and development | $81,768 | $67,564 | +21.0% | | General and administrative | $23,734 | $24,357 | -2.6% | | Gain on sale of in-process R&D asset | $(10,000) | $0 | N/A | | Total operating expenses | $95,502 | $91,921 | +3.9% | | Loss from operations | $(95,502) | $(91,921) | +3.9% | | Total other income | $13,997 | $9,259 | +51.2% | | Net loss | $(81,490) | $(82,694) | -1.5% | | Net loss per share, common (basic and diluted) | $(1.09) | $(1.31) | -16.8% | - R&D expenses increased by **22.9% for Q2 2025** and **21.0% for the six months ended June 30, 2025**, reflecting increased clinical trial activities[13](index=13&type=chunk)[28](index=28&type=chunk) - A **$10.0 million gain** from the sale of an in-process R&D asset positively impacted the net loss for both the three and six-month periods in 2025[14](index=14&type=chunk)[28](index=28&type=chunk)

[FORM 10-Q](index=1&type=section&id=FORM%2010-Q) This quarterly report provides financial and operational updates for SPYRE THERAPEUTICS, INC. for the period ended June 30, 2025 - This is a **Quarterly Report on Form 10-Q** for the period ended **June 30, 2025**, filed by **SPYRE THERAPEUTICS, INC.** (Commission File Number: **001-37722**)[2](index=2&type=chunk) Registrant Information | Indicator | Value | | :--- | :--- | | Trading Symbol | SYRE | | Exchange | The Nasdaq Stock Market LLC | | Filer Status | Large accelerated filer | | Common Stock Outstanding (as of July 31, 2025) | 60,400,960 shares | [Note About Forward-Looking Statements](index=3&type=section&id=NOTE%20ABOUT%20FORWARD-LOOKING%20STATEMENTS) This section outlines the inherent risks and uncertainties associated with forward-looking statements, advising readers against undue reliance on future predictions - This report contains **forward-looking statements** regarding future results, financial position, business strategy, clinical development plans (including SPY001, SPY002, SPY072, SPY003 trials), regulatory feedback, and the company's ability to fund operations[9](index=9&type=chunk) - These statements are subject to **risks and uncertainties**, such as potential disagreements with regulatory authorities on clinical trial design, inconsistencies in clinical data, macroeconomic conditions (inflation, interest rates, geopolitical conflicts), and changes in law[10](index=10&type=chunk) - Readers are cautioned not to rely on forward-looking statements as predictions of future events, and the company undertakes no obligation to update them, except as required by law[12](index=12&type=chunk) [PART I. FINANCIAL INFORMATION](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This part presents the unaudited condensed consolidated financial statements and management's discussion and analysis of financial condition and results of operations [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents unaudited condensed consolidated financial statements, including balance sheets, statements of operations, comprehensive loss, equity changes, and cash flows [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20as%20of%20June%2030%2C%202025%20and%20December%2031%2C%202024) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity as of June 30, 2025, and December 31, 2024 Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $81,659 | $89,423 | $(7,764) | | Marketable securities | $444,921 | $513,665 | $(68,744) | | Total current assets | $538,832 | $608,474 | $(69,642) | | Total assets | $538,832 | $608,484 | $(69,652) | | CVR liability (current) | $59,900 | $25,080 | $34,820 | | CVR liability (non-current) | — | $36,620 | $(36,620) | | Total current liabilities | $83,059 | $54,060 | $28,999 | | Total liabilities | $83,059 | $90,680 | $(7,621) | | Total stockholders' equity | $455,773 | $517,804 | $(62,031) | - **Total assets decreased by $69.7 million**, primarily driven by a reduction in marketable securities and cash, while **total liabilities decreased by $7.6 million**, mainly due to the reclassification and decrease in CVR liability[17](index=17&type=chunk) [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) This section details the company's financial performance, including revenues, expenses, and net loss, for the three and six months ended June 30, 2025 and 2024 Condensed Consolidated Statements of Operations (in thousands, except per share amounts) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change (YoY) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Research and development | $40,145 | $32,636 | +23% | $81,768 | $67,564 | +21% | | General and administrative | $11,790 | $11,511 | +2% | $23,734 | $24,357 | -3% | | Gain on sale of in-process R&D asset | $(10,000) | — | N/A | $(10,000) | — | N/A | | Total operating expenses | $41,935 | $44,147 | -5% | $95,502 | $91,921 | +4% | | Loss from operations | $(41,935) | $(44,147) | -5% | $(95,502) | $(91,921) | +4% | | Interest income | $5,874 | $5,920 | -1% | $12,367 | $10,352 | +19% | | Other (expense) income, net | $(656) | $(610) | +7% | $1,630 | $(1,093) | N/A | | Net loss | $(36,717) | $(38,837) | -5% | $(81,490) | $(82,694) | -1% | | Net loss per common share (basic and diluted) | $(0.49) | $(0.59) | -17% | $(1.09) | $(1.31) | -17% | - **Net loss decreased by 5%** for the three months ended June 30, 2025, and by **1%** for the six months ended June 30, 2025, primarily due to a **$10.0 million gain on the sale of an in-process R&D asset** and increased interest income, partially offset by higher R&D expenses[20](index=20&type=chunk) [Condensed Consolidated Statements of Comprehensive Loss](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) This section presents the total comprehensive loss, including net loss and other comprehensive income items, for the three and six months ended June 30, 2025 and 2024 Condensed Consolidated Statements of Comprehensive Loss (in thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | Change (YoY) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change (YoY) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net loss | $(36,717) | $(38,837) | -5% | $(81,490) | $(82,694) | -1% | | Foreign currency translation adjustment | $(36) | $4 | N/A | $(22) | $20 | N/A | | Unrealized (loss) gain on marketable securities | $(192) | $(194) | -1% | $296 | $(875) | N/A | | Total comprehensive loss | $(36,945) | $(39,027) | -5% | $(81,216) | $(83,549) | -3% | - **Total comprehensive loss decreased by 5%** for the three months and **3%** for the six months ended June 30, 2025, primarily reflecting the decrease in net loss and a shift from unrealized loss to gain on marketable securities for the six-month period[25](index=25&type=chunk) [Condensed Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Convertible%20Preferred%20Stock%20and%20Stockholders%27%20Equity%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) This section outlines changes in the company's convertible preferred stock and stockholders' equity for the six months ended June 30, 2025 and 2024 Key Changes in Stockholders' Equity (in thousands) | Metric | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :--- | :--- | :--- | | Balances - December 31, 2024/2023 | $517,804 | $184,016 | | Issuance of common stock (options/ESPP) | $1,065 | $4,884 | | Stock-based compensation expense | $18,237 | $22,517 | | Net loss | $(81,490) | $(82,694) | | Conversion of Series B Preferred Stock to Common Stock | — | $244,010 | | Exchange of Series A Preferred Stock for Common Stock | — | $38,501 | | Balances - June 30, 2025/2024 | $455,773 | $374,385 | - **Total stockholders' equity decreased by $62.0 million** from December 31, 2024, to June 30, 2025, primarily due to the net loss, partially offset by stock-based compensation and common stock issuances[27](index=27&type=chunk) - In the six months ended June 30, 2024, significant changes included the **conversion of Series B Preferred Stock** and **exchange of Series A Preferred Stock into common stock**, and a private placement of Series B Preferred Stock[28](index=28&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) This section details the cash inflows and outflows from operating, investing, and financing activities for the six months ended June 30, 2025 and 2024 Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change (YoY) | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | $(87,557) | $(90,790) | $(3,233) | | Net cash provided by (used in) investing activities | $78,937 | $(225,481) | $304,418 | | Net cash provided by financing activities | $856 | $172,525 | $(171,669) | | Net decrease in cash, cash equivalents, and restricted cash | $(7,764) | $(143,750) | $135,986 | | Cash, cash equivalents, and restricted cash (End of period) | $81,659 | $45,465 | $36,194 | - **Net cash used in operating activities decreased by $3.2 million**, while **net cash provided by investing activities significantly increased by $304.4 million**, primarily due to higher proceeds from maturities and sales of marketable securities[31](index=31&type=chunk) - **Net cash provided by financing activities decreased substantially by $171.7 million**, mainly due to the absence of a large private placement of Series B Preferred Stock in 2025, which occurred in 2024[31](index=31&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the unaudited condensed consolidated financial statements [1. The Company and Basis of Presentation](index=11&type=section&id=1.%20The%20Company%20and%20Basis%20of%20Presentation) This note provides an overview of Spyre Therapeutics, Inc., its corporate history, asset acquisition, financing activities, and liquidity status - **Spyre Therapeutics, Inc.** is a clinical-stage biotechnology company focused on developing therapeutics for inflammatory bowel disease (IBD) and other immune-mediated diseases, following its rebranding and the **Asset Acquisition of Pre-Merger Spyre in June 2023**[34](index=34&type=chunk)[35](index=35&type=chunk) - Key financing events include a **March 2024 private placement of Series B Preferred Stock ($168.9 million net proceeds)**, an April 2024 exchange of Series A Preferred Stock for common stock, and a **November 2024 underwritten public offering ($215.9 million net proceeds)**[37](index=37&type=chunk)[38](index=38&type=chunk)[42](index=42&type=chunk) - As of June 30, 2025, the company had an **accumulated deficit of $1.1 billion** and **$526.6 million in cash, cash equivalents, and marketable securities**, with sufficient resources to fund operations for at least one year, but will require additional future financing[45](index=45&type=chunk)[46](index=46&type=chunk) [2. Summary of Significant Accounting Policies](index=13&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This note confirms the basis of financial statement preparation, consistency of accounting policies, and evaluation of new accounting pronouncements - The interim financial statements are **unaudited** and prepared on the same basis as annual statements, reflecting normal and recurring adjustments[48](index=48&type=chunk) - There have been **no significant changes** to the company's accounting policies or estimates disclosed in the Annual Report[50](index=50&type=chunk) - The company is evaluating the impact of **ASU 2023-09** (Income Tax Disclosures, effective after Dec 15, 2024) and **ASU 2024-03** (Expense Disaggregation Disclosures, effective after Dec 15, 2026) on its future disclosures[52](index=52&type=chunk)[53](index=53&type=chunk)[54](index=54&type=chunk) [3. Fair Value Measurements](index=14&type=section&id=3.%20Fair%20Value%20Measurements) This note details the fair value measurements of financial assets and liabilities, categorized by the three-tier fair value hierarchy, including the CVR liability Fair Value of Financial Assets and Liabilities (in thousands) | Category | June 30, 2025 (Total) | December 31, 2024 (Total) | | :--- | :--- | :--- | | **Financial Assets:** | | | | Money market funds (Level 1) | $79,957 | $65,902 | | U.S. government treasury securities (Level 1) | $221,646 | $227,244 | | U.S. government agency securities (Level 2) | $70,526 | $86,681 | | Commercial paper (Level 2) | $89,178 | $165,130 | | Corporate bonds (Level 2) | $63,571 | $56,448 | | **Total financial assets** | **$524,878** | **$601,405** | | **Liabilities:** | | | | CVR liability (Level 3) | $59,900 | $61,700 | | **Total liabilities** | **$59,900** | **$61,700** | - The **CVR liability**, valued using a probability-weighted discounted cash flow method (Level 3), **decreased by $1.8 million** from December 31, 2024, to June 30, 2025, primarily due to changes in the likelihood of milestone achievement and increased discount rates[57](index=57&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk) CVR Liability Valuation Inputs (June 30, 2025) | Input | Value | | :--- | :--- | | Estimated cash flow dates | 08/28/25 - 06/22/26 | | Estimated probability of success | 72% - 100% | | Estimated reimbursement rate | 49% - 100% | | Risk-adjusted discount rates | 9.38% - 9.48% | [4. Cash Equivalents and Marketable Securities](index=15&type=section&id=4.%20Cash%20Equivalents%20and%20Marketable%20Securities) This note provides a detailed breakdown of cash equivalents and marketable securities, including fair values, unrealized gains/losses, and contractual maturities Cash Equivalents and Marketable Securities (in thousands) | Category | June 30, 2025 (Fair Value) | December 31, 2024 (Fair Value) | | :--- | :--- | :--- | | **Cash equivalents:** | | | | Money market funds | $79,957 | $65,902 | | Commercial paper (Dec 2024 only) | — | $21,838 | | **Total cash equivalents** | **$79,957** | **$87,740** | | **Marketable securities:** | | | | Commercial paper | $89,178 | $143,292 | | Corporate bonds | $63,571 | $56,448 | | U.S. government treasury securities | $221,646 | $227,244 | | U.S. government agency securities | $70,526 | $86,681 | | **Total marketable securities** | **$444,921** | **$513,665** | - As of June 30, 2025, marketable securities in an **unrealized loss position totaled $170.6 million** with gross unrealized losses of **$153 thousand**, primarily due to market conditions, not credit loss[61](index=61&type=chunk)[62](index=62&type=chunk) The company intends to hold these securities until recovery[62](index=62&type=chunk) Contractual Maturities of Marketable Securities (in thousands) | Maturity | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Due in one year or less | $327,764 | $338,442 | | Due in 1 - 2 years | $117,157 | $175,223 | | **Total marketable securities** | **$444,921** | **$513,665** | [5. Accrued and Other Current Liabilities](index=17&type=section&id=5.%20Accrued%20and%20Other%20Current%20Liabilities) This note details the composition of accrued and other current liabilities, highlighting changes from December 31, 2024, to June 30, 2025 Accrued and Other Current Liabilities (in thousands) | Category | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Accrued compensation | $3,289 | $5,688 | $(2,399) | | Accrued contracted research and development costs | $15,018 | $20,861 | $(5,843) | | Accrued professional and consulting fees | $867 | $661 | $206 | | Accrued other | $242 | $501 | $(259) | | **Total accrued and other current liabilities** | **$19,416** | **$27,711** | **$(8,295)** | [6. Licensing Agreements](index=17&type=section&id=6.%20Licensing%20Agreements) This note outlines exclusive license agreements with Paragon for key research programs, detailing milestone payment obligations and royalty terms - The company exercised options and entered into exclusive license agreements with Paragon for **SPY001 (α4ß7 integrin)**, **SPY002/SPY072 (TL1A)**, and **SPY003 (IL-23) programs**[67](index=67&type=chunk)[68](index=68&type=chunk)[69](index=69&type=chunk) - Under each License Agreement, the company is obligated to pay Paragon up to **$22.0 million in development, regulatory, and clinical milestones per product**, including **$3.0 million upon first dosing in a Phase 2 trial**[71](index=71&type=chunk) Paragon License Milestone Payments (in thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Expense recognized | $0 | $5,500 | $2,500 | $5,500 | | Payments made | $2,500 | $3,000 | $2,500 | $3,000 | | Sublicensing fees (expense/paid) | $0 | $100 | $0 | $100 | [7. Related Party Transactions](index=18&type=section&id=7.%20Related%20Party%20Transactions) This note details transactions with related parties, including reimbursable costs, license fees, and stock-based compensation, and changes in related party payables - **Fairmount Funds Management LLC**, a significant stockholder, has board representation and beneficial ownership in Paragon, establishing related party relationships[77](index=77&type=chunk) Related Party Expenses (in millions) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Reimbursable costs (Paragon Agreement) | $0 | $2.3 | $0.1 | $14.0 | | License Agreements milestone and sublicensing fees | $0 | $5.6 | $2.5 | $5.6 | | **Total related party expense** | **$0** | **$7.9** | **$2.6** | **$19.6** | - **Related party accounts payable decreased from $0.6 million** as of December 31, 2024, to **nil** as of June 30, 2025[78](index=78&type=chunk)[82](index=82&type=chunk) Stock-based compensation related to Paragon services also significantly decreased in 2025[83](index=83&type=chunk) [8. Convertible Preferred Stock and Stockholders' Equity](index=20&type=section&id=8.%20Convertible%20Preferred%20Stock%20and%20Stockholders%27%20Equity) This note details the company's convertible preferred stock and common stock, including rights, conversion events, and recent equity offerings - As of June 30, 2025, **1,532,591 Parapyre warrants** with a weighted-average exercise price of **$22.49** were outstanding and unexercised[90](index=90&type=chunk) - In April 2024, **90,992 shares of Series A Preferred Stock were exchanged for 3,639,680 shares of common stock**[92](index=92&type=chunk) As of June 30, 2025, **346,045 Series A shares remained outstanding**, convertible into 13,841,800 common shares[92](index=92&type=chunk) - Following stockholder approval in May 2024, **254,958 shares of Series B Preferred Stock automatically converted to 10,198,320 common shares**[97](index=97&type=chunk) **16,667 Series B shares remained outstanding** due to beneficial ownership limitations, convertible into 666,680 common shares[97](index=97&type=chunk) - As of June 30, 2025, **$179.1 million remained available for sale** under the ATM offering program from the February 2025 Shelf Registration Statement[99](index=99&type=chunk) [9. Stock-Based Compensation](index=23&type=section&id=9.%20Stock-Based%20Compensation) This note details equity incentive plans, the Parapyre Option Obligation, ESPP, stock-based compensation expense, and Black-Scholes assumptions - As of June 30, 2025, the **2016 Plan had 10,911,455 shares available** for future issuance, and the **2018 Plan had 7,606,811 shares available**, following an amendment to increase shares by 750,000[103](index=103&type=chunk)[104](index=104&type=chunk) - The **Parapyre Option Obligation was settled by December 31, 2024**, with 1,532,591 warrants outstanding as of June 30, 2025[108](index=108&type=chunk) No ongoing obligations exist under this program[109](index=109&type=chunk) Total Stock-Based Compensation Expense (in thousands) | Category | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $4,100 | $3,451 | $7,612 | $10,308 | | General and administrative | $5,278 | $5,231 | $10,625 | $12,209 | | **Total stock-based compensation expense** | **$9,378** | **$8,682** | **$18,237** | **$22,517** | Weighted-Average Black-Scholes Assumptions (6 Months Ended June 30, 2025 vs. 2024) | Assumption | 2025 | 2024 | | :--- | :--- | :--- | | Expected term (stock options) | 5.97 years | 6.00 years | | Expected volatility (stock options) | 76% | 105% | | Risk-free interest (stock options) | 4.38% | 4.01% | | Expected term (ESPP) | 0.50 years | 0.50 years | | Expected volatility (ESPP) | 69% | 98% | | Risk-free interest (ESPP) | 4.23% | 5.31% | [10. Sale of Pegzilarginase to Immedica](index=25&type=section&id=10.%20Sale%20of%20Pegzilarginase%20to%20Immedica) This note describes the agreement to sell global rights to pegzilarginase to Immedica, including the recognition of a $10.0 million gain in Q2 2025 - In July 2023, the company agreed to sell global rights to pegzilarginase to Immedica for **$15.0 million upfront** and up to **$100.0 million in contingent milestone payments**[113](index=113&type=chunk) - A **$10.0 million gain was recognized** in the three and six months ended June 30, 2025, from achieving European reimbursement decision milestones for pegzilarginase[114](index=114&type=chunk) - Milestone payments, net of expenses, will reduce the CVR liability and be distributed to CVR holders[115](index=115&type=chunk) [11. Segment Reporting](index=25&type=section&id=11.%20Segment%20Reporting) This note states the company operates as a single segment focused on biopharmaceutical product development, with the CEO as the CODM - The company operates in **one segment**: development of biopharmaceutical products for IBD and other immune-mediated diseases[116](index=116&type=chunk) - The CEO serves as the **CODM**, using consolidated Net Loss as the primary measure of segment profit or loss and Total Assets for segment assets[116](index=116&type=chunk) Significant Expenses Provided to CODM (in thousands) | Expense Category | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Compensation | $8,120 | $4,881 | $15,111 | $9,055 | | Stock-based compensation | $9,378 | $8,682 | $18,237 | $22,517 | | R&D (excl. comp/stock-based) | $30,749 | $26,808 | $64,300 | $52,910 | | Other segment items | $(11,530) | $(1,534) | $(16,158) | $(1,788) | [12. Net Loss Per Share](index=26&type=section&id=12.%20Net%20Loss%20Per%20Share) This note explains the computation of net loss per share for common and preferred stock using the two-class method, excluding anti-dilutive securities - **Net loss per share is computed using the two-class method**, allocating losses to common, Series A, and Series B Preferred Stock[118](index=118&type=chunk)[119](index=119&type=chunk) - For all periods presented, **diluted net loss per share is the same as basic net loss per share** because the company generated a net loss, making the inclusion of potential common shares anti-dilutive[120](index=120&type=chunk) Net Loss Per Share (Basic and Diluted) | Share Class | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Series A Preferred Stock | $(19.62) | $(23.61) | $(43.57) | $(52.32) | | Series B Preferred Stock | $(19.62) | $(23.61) | $(43.57) | $(52.32) | | Common Stock | $(0.49) | $(0.59) | $(1.09) | $(1.31) | Anti-Dilutive Equity Instruments Excluded from EPS Calculation | Instrument | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Options to purchase common stock | 805,306 | 5,010,436 | 1,324,645 | 4,526,643 | | Unvested restricted stock units | — | 79,870 | 11,943 | 71,368 | | Outstanding Parapyre warrants | — | 684,407 | — | 684,407 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on financial condition, operational results, product pipeline, and critical accounting policies [Acquisition of Pre-Merger Spyre](index=28&type=section&id=Acquisition%20of%20Pre-Merger%20Spyre) This section details the acquisition of Pre-Merger Spyre, which granted the company options to license intellectual property for key research programs - On **June 22, 2023**, Spyre acquired Pre-Merger Spyre, gaining the option to license intellectual property rights for research programs[123](index=123&type=chunk) - The company exercised options for **SPY001 (α4β7 integrin)**, **SPY002/SPY072 (TL1A)**, and **SPY003 (IL-23) programs**, with expected patent expirations no earlier than 2044-2045[124](index=124&type=chunk) [Overview](index=28&type=section&id=Overview) This section outlines the company's strategic focus on developing next-generation therapeutics for Inflammatory Bowel Disease and Rheumatic Diseases with enhanced pharmacokinetic profiles - Following the Asset Acquisition, Spyre reshaped its business to focus on developing **next-generation therapeutics for Inflammatory Bowel Disease (IBD) and Rheumatic Diseases (RD)**[125](index=125&type=chunk) - The company's product candidates are engineered for potent binding, selectivity, and extended pharmacokinetic (PK) half-lives to enable less frequent, convenient subcutaneous administration, and plans to investigate combination therapies for greater efficacy[126](index=126&type=chunk) [Our Portfolio and Development Plan Updates](index=29&type=section&id=Our%20Portfolio%20and%20Development%20Plan%20Updates) This section provides updates on the company's clinical trials, including the SKYLINE-UC and SKYWAY-RD trials, and the progress of SPY001, SPY002, SPY072, and SPY003 programs - The **SKYLINE-UC Phase 2 platform trial for ulcerative colitis (UC)** was initiated in **May 2025**, evaluating SPY001, SPY002, SPY003, and pairwise combinations[129](index=129&type=chunk)[130](index=130&type=chunk) Enrollment is ongoing for the SPY001 arm of Part A[131](index=131&type=chunk) - The **SKYWAY-RD Phase 2 basket trial for rheumatic diseases** (RA, PsA, axSpA) evaluating SPY072 is planned for initiation in **Q3 2025**[132](index=132&type=chunk)[133](index=133&type=chunk) - **SPY001 Phase 1 trial showed a favorable safety profile, differentiated PK, and complete α4β7 receptor saturation beyond six months with a single 600mg dose**, leading to its advancement into SKYLINE-UC[136](index=136&type=chunk) - **SPY002 and SPY072 Phase 1 data (June 2025) demonstrated favorable safety, differentiated PK, and complete free TL1A suppression for up to 20 weeks**, with SPY002 advancing to SKYLINE-UC and SPY072 to SKYWAY-RD in Q3 2025[140](index=140&type=chunk) - **SPY003 Phase 1 trial initiated in March 2025**, with interim safety and PK data expected in Q4 2025[143](index=143&type=chunk) Successful results would lead to its advancement into SKYLINE-UC[143](index=143&type=chunk) - **Combination therapies (SPY120, SPY130, SPY230)** are undergoing nonclinical and toxicology studies, with preclinical data showing additive or greater than additive biological activity[144](index=144&type=chunk)[145](index=145&type=chunk)[146](index=146&type=chunk)[147](index=147&type=chunk)[148](index=148&type=chunk) These combinations are intended for inclusion in the SKYLINE-UC Phase 2 platform trial, subject to regulatory feedback[149](index=149&type=chunk)[150](index=150&type=chunk) [Paragon Agreement](index=32&type=section&id=Paragon%20Agreement) This section details the exclusive license agreements with Paragon for SPY001, SPY002, SPY072, and SPY003 programs, including milestone payment obligations - The company exercised its option under the Paragon Agreement for **SPY001, SPY002, SPY072, and SPY003 research programs**, leading to exclusive license agreements[152](index=152&type=chunk) - Under these agreements, Spyre is obligated to pay Paragon up to **$22.0 million in development, regulatory, and clinical milestones** for the first product under each agreement, plus potential sublicensing fees of up to **$20 million for SPY002/SPY072**[153](index=153&type=chunk) [Critical Accounting Policies and Estimates](index=32&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section discusses the significant judgments and estimates required for financial statement preparation, particularly for R&D costs, CVR valuation, and stock-based compensation - The preparation of financial statements requires significant judgments and estimates, particularly for **accrued research and development costs**, the valuation of the **contingent value right (CVR) liability**, and inputs for **stock-based compensation expense**[155](index=155&type=chunk)[156](index=156&type=chunk) - There have been **no significant changes** to the critical accounting policies and estimates since the Annual Report[157](index=157&type=chunk) [Results of Operations](index=33&type=section&id=Results%20of%20Operations) This section provides a detailed comparison of the company's financial performance for the three and six months ended June 30, 2025 and 2024 [Comparison of the Three Months Ended June 30, 2025 and 2024](index=33&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20June%2030%2C%202025%20and%202024) For the three months ended June 30, 2025, the company reported a reduced net loss, driven by an asset sale gain despite increased R&D expenses Operating Results (Three Months Ended June 30, in thousands) | Metric | 2025 | 2024 | Increase/(Decrease) | % Change | | :--- | :--- | :--- | :--- | :--- | | Research and development | $40,145 | $32,636 | $7,509 | 23% | | General and administrative | $11,790 | $11,511 | $279 | 2% | | Gain on sale of in-process R&D asset | $(10,000) | — | $(10,000) | * | | Total operating expenses | $41,935 | $44,147 | $(2,212) | (5)% | | Net loss | $(36,717) | $(38,837) | $(2,120) | * | - **Research and development expenses increased by $7.5 million (23%)** due to higher clinical trial expenses and compensation costs, partially offset by lower early-stage R&D and intellectual property fees[159](index=159&type=chunk)[161](index=161&type=chunk)[162](index=162&type=chunk) - A **$10.0 million gain was recognized** from the sale of the pegzilarginase asset due to a favorable reimbursement decision in Europe[164](index=164&type=chunk) [Comparison of the Six Months Ended June 30, 2025 and 2024](index=35&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) For the six months ended June 30, 2025, the net loss slightly decreased, primarily due to an asset sale gain and increased interest income, despite higher R&D Operating Results (Six Months Ended June 30, in thousands) | Metric | 2025 | 2024 | Dollar Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Research and development | $81,768 | $67,564 | $14,204 | 21% | | General and administrative | $23,734 | $24,357 | $(623) | (3)% | | Gain on sale of in-process R&D asset | $(10,000) | — | $(10,000) | * | | Total operating expenses | $95,502 | $91,921 | $3,581 | * | | Net loss | $(81,490) | $(82,694) | $(1,204) | * | - **Research and development expenses increased by $14.2 million (21%)** due to higher clinical development activities and compensation costs, partially offset by lower early-stage R&D and intellectual property fees[168](index=168&type=chunk)[170](index=170&type=chunk)[171](index=171&type=chunk) - **Interest income increased by $2.0 million to $12.4 million**, primarily due to higher investment balances[174](index=174&type=chunk) - **Other income, net, increased by $2.7 million**, mainly driven by changes in the fair value of the CVR liability[176](index=176&type=chunk) [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's historical funding sources, recent financing activities, and cash flow analysis, along with contingent contractual obligations [Sources of Liquidity](index=37&type=section&id=Sources%20of%20Liquidity) The company has historically funded operations through equity issuances and licensing. Recent financing activities include a private placement of Series B Preferred Stock, an ATM offering, and an underwritten public offering - Since inception through June 30, 2025, the company raised approximately **$1.3 billion in gross proceeds** from equity sales, pre-funded warrants, grants, and product rights licensing[178](index=178&type=chunk) - In March 2024, a **private placement of Series B Preferred Stock generated approximately $168.9 million in net proceeds**[180](index=180&type=chunk) - An **ATM offering in September and December 2024 yielded approximately $20.5 million in net proceeds** from 777,432 common shares[181](index=181&type=chunk) - A **November 2024 underwritten public offering of 8,366,250 common shares generated approximately $215.9 million in net proceeds**[182](index=182&type=chunk) [Cash Flows](index=38&type=section&id=Cash%20Flows) The company's cash flows for the six months ended June 30, 2025, show a decrease in cash used in operating activities and a significant increase in cash provided by investing activities, while financing activities provided substantially less cash compared to the prior year Summary of Cash Flows (Six Months Ended June 30, in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Operating activities | $(87,557) | $(90,790) | | Investing activities | $78,937 | $(225,481) | | Financing activities | $856 | $172,525 | | Net (decrease) increase in cash | $(7,764) | $(143,750) | - **Cash used in operating activities decreased by $3.2 million**, primarily due to a lower net loss and favorable changes in operating assets and liabilities, partially offset by lower stock-based compensation[185](index=185&type=chunk)[186](index=186&type=chunk) - **Cash provided by investing activities significantly increased to $78.9 million** (from $(225.5) million in 2024), driven by higher proceeds from maturities and sales of marketable securities[187](index=187&type=chunk)[188](index=188&type=chunk) - **Cash provided by financing activities decreased to $0.9 million** (from $172.5 million in 2024), mainly due to the absence of the large Series B Preferred Stock private placement in 2025[189](index=189&type=chunk)[190](index=190&type=chunk) [Contingent Contractual Obligations](index=38&type=section&id=Contingent%20Contractual%20Obligations) This section details the company's contingent contractual obligations related to milestone and sublicensing fees under its license agreements with Paragon - The company has incurred **$12.0 million in milestone fees** out of a maximum of **$66.0 million** across all License Agreements as of June 30, 2025, with no outstanding milestone fees payable[192](index=192&type=chunk) - For the SPY002 and SPY072 License Agreement, the company is obligated to pay up to approximately **$20 million in sublicensing fees** upon achievement of mostly commercial milestones, with **$0.7 million incurred and nil outstanding** as of June 30, 2025[192](index=192&type=chunk) [Recently Adopted Accounting Pronouncements](index=39&type=section&id=Recently%20Adopted%20Accounting%20Pronouncements) This section confirms that no recently adopted accounting pronouncements have materially affected the company's financial position or results of operations - No recently adopted accounting pronouncements have had a material effect on the company's financial position or results of operations[193](index=193&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section discusses the company's exposure to market risks, including interest rate sensitivity, foreign currency exchange rates, and inflation risk, concluding that these risks are not currently significant - The company's primary market risk exposure is **interest rate sensitivity** on its **$526.6 million in cash, cash equivalents, and marketable securities**, which are primarily short-term and denominated in U.S. dollars[195](index=195&type=chunk) - A hypothetical **10% change in interest rates** would not have a material effect on the total market value of cash equivalents and marketable securities as of June 30, 2025[195](index=195&type=chunk) - **Foreign currency risk is not significant**, as most expenditures are in U.S. dollars, and a hypothetical 10% change in exchange rates would not materially impact financial statements[196](index=196&type=chunk) Inflation has not had a material adverse effect on operations[197](index=197&type=chunk) [Item 4. Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, with the participation of the principal executive and financial officers, evaluated the effectiveness of disclosure controls and procedures, concluding they were effective as of June 30, 2025. No material changes in internal control over financial reporting occurred during the quarter - As of June 30, 2025, the company's **disclosure controls and procedures were evaluated and concluded to be effective** at a reasonable assurance level[198](index=198&type=chunk) - There were **no changes in internal control over financial reporting** during the quarter ended June 30, 2025, that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[199](index=199&type=chunk) [PART II. OTHER INFORMATION](index=41&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part provides additional information including legal proceedings, risk factors, equity sales, defaults, and other disclosures [Item 1. Legal Proceedings](index=41&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 operations, financial condition, or cash flows - Management believes there are **no claims or actions pending** against the company that could have a material adverse effect on its results of operations, financial condition, or cash flows[201](index=201&type=chunk) [Item 1A. Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) This section outlines principal factors making an investment in the company speculative, covering financial, development, regulatory, intellectual property, and operational risks [Risk Factor Summary](index=41&type=section&id=Risk%20Factor%20Summary) This summary highlights key risk categories including financial, development, regulatory, intellectual property, and operational challenges - Key risk categories include **financial condition and capital requirements**, **discovery, development and commercialization**, **government regulation**, **intellectual property**, **reliance on third parties**, **employee matters**, **managing growth**, and risks related to common stock[203](index=203&type=chunk)[204](index=204&type=chunk)[205](index=205&type=chunk)[206](index=206&type=chunk) - Significant risks include the **need for additional capital**, potential for no product revenue or profitability, dependence on SPY001, SPY002, SPY072, and SPY003 programs, and the inherent unpredictability of regulatory approval processes[204](index=204&type=chunk) [Risks Related to Our Financial Condition and Capital Requirements](index=43&type=section&id=Risks%20Related%20to%20Our%20Financial%20Condition%20and%20Capital%20Requirements) This section details risks associated with the company's financial condition, including the need for additional capital, potential for dilution, and going concern uncertainties - The company will need to **raise additional capital** to fund operations and continue as a going concern, as it has incurred significant operating losses since inception and has no product sales revenue[209](index=209&type=chunk)[214](index=214&type=chunk)[215](index=215&type=chunk)[216](index=216&type=chunk) - Failure to raise capital on acceptable terms could lead to **delays or discontinuation of product development**, unfavorable strategic partnerships, asset disposal, or even bankruptcy[212](index=212&type=chunk) - Raising additional capital through equity or convertible debt will **dilute existing stockholders**, and debt financing may impose restrictive covenants[224](index=224&type=chunk)[226](index=226&type=chunk) [Risks Related to Discovery, Development and Commercialization](index=46&type=section&id=Risks%20Related%20to%20Discovery%2C%20Development%20and%20Commercialization) This section outlines risks inherent in product discovery, development, and commercialization, including competition, clinical trial failures, and regulatory unpredictability - The company faces **intense competition from multinational biopharmaceutical companies** with greater resources and expertise, which could hinder market penetration and clinical trial enrollment[229](index=229&type=chunk)[231](index=231&type=chunk) - All product candidates are in clinical or nonclinical stages, and there is **no guarantee of regulatory approval or commercialization**[232](index=232&type=chunk) Delays or failures in clinical trials due to various factors (e.g., regulatory disagreements, participant enrollment, manufacturing issues) could materially harm the business[233](index=233&type=chunk)[234](index=234&type=chunk)[235](index=235&type=chunk) - Success is substantially dependent on **SPY001, SPY002, SPY072, and SPY003 programs**, which rely on observing longer half-lives in humans and comparable or better safety/efficacy profiles than competitors[237](index=237&type=chunk) - Preliminary or interim clinical data may change with more complete information, and **significant adverse events or undesirable side effects could halt development**, inhibit approval, or limit market acceptance[257](index=257&type=chunk)[260](index=260&type=chunk) - Developing intra-portfolio drug combinations presents challenges, as they may not achieve superior outcomes, could exacerbate adverse events, or fail to demonstrate sufficient safety or efficacy for marketing approval[251](index=251&type=chunk)[253](index=253&type=chunk)[254](index=254&type=chunk) [Risks Related to Government Regulation](index=56&type=section&id=Risks%20Related%20to%20Government%20Regulation) This section details risks associated with government regulation, including lengthy approval processes, CMC requirements, biosimilar competition, and healthcare reforms - The **regulatory approval process is lengthy, expensive, and unpredictable**[273](index=273&type=chunk) Delays or failure to obtain approvals for product candidates (SPY001, SPY002, SPY072, SPY003) would materially impair revenue generation[274](index=274&type=chunk)[275](index=275&type=chunk) - The company must meet **chemistry, manufacturing, and control (CMC) requirements** for regulatory approval, and failure to do so could prevent product approval[278](index=278&type=chunk)[279](index=279&type=chunk) - Approved biologics may face earlier competition from **biosimilars** if exclusivity periods are shortened or not granted, impacting commercial viability[280](index=280&type=chunk)[281](index=281&type=chunk) - Ongoing regulatory obligations post-approval, including reporting and compliance with cGMPs, GVPs, and GCPs, will incur significant expenses, and non-compliance could lead to penalties or product withdrawal[282](index=282&type=chunk)[283](index=283&type=chunk) - Healthcare legislative reforms, foreign trade regulations (e.g., tariffs, BIOSECURE Act), and strict price controls in foreign markets could negatively impact the business, increase costs, or limit revenue[284](index=284&type=chunk)[288](index=288&type=chunk)[290](index=290&type=chunk)[291](index=291&type=chunk) [Risks Related to Our Intellectual Property](index=62&type=section&id=Risks%20Related%20to%20Our%20Intellectual%20Property) This section discusses risks concerning intellectual property, including patent protection uncertainties, trade secret vulnerabilities, and potential infringement claims - The ability to obtain and protect patents and other proprietary rights is uncertain, exposing the company to **loss of competitive advantage** if patents are not issued, are infringed, invalidated, or difficult to enforce globally[296](index=296&type=chunk)[297](index=297&type=chunk) - Reliance on **trade secrets** carries risks of disclosure or misappropriation, which could erode competitive position[298](index=298&type=chunk) Confidentiality agreements may not provide adequate remedies[298](index=298&type=chunk) - Failure to acquire or in-license necessary third-party intellectual property rights on reasonable terms could force the abandonment of relevant programs[301](index=301&type=chunk)[304](index=304&type=chunk) - The company may face **costly patent infringement claims** or need to file such claims, diverting resources and potentially preventing commercialization[307](index=307&type=chunk)[308](index=308&type=chunk] Changes in patent laws (e.g., Leahy-Smith Act, Amgen v. Sanofi ruling) could diminish patent value[314](index=314&type=chunk)[315](index=315&type=chunk) - Geopolitical instability (e.g., Russia-Ukraine conflict) could impact patent prosecution and maintenance in foreign countries, leading to loss of patent rights[317](index=317&type=chunk) [Risks Related to Our Reliance on Third Parties](index=68&type=section&id=Risks%20Related%20to%20Our%20Reliance%20on%20Third%20Parties) This section outlines risks associated with reliance on third parties for collaborations, clinical trials, and manufacturing, including potential disruptions and non-compliance - The company relies heavily on **collaborations and licensing arrangements with third parties**, including Paragon, for discovery capabilities and in-licenses[327](index=327&type=chunk) Failure to maintain these or if they are unsuccessful could negatively impact the business[328](index=328&type=chunk) - Reliance on third parties (CROs, CMOs, investigators) for nonclinical studies and clinical trials means less direct control over conduct and timing[332](index=332&type=chunk) Non-compliance with GLP, GCP, GVP regulations by these parties could deem data unreliable and delay regulatory approval[332](index=332&type=chunk) - The company relies on **CMOs for manufacturing product candidates** and has a sole source relationship for SPY001, SPY002, and SPY003[338](index=338&type=chunk) Disruptions or difficulties in production by CMOs could adversely affect clinical development and commercialization[339](index=339&type=chunk)[340](index=340&type=chunk) - Foreign CROs and CMOs, including those in China, are subject to U.S. legislation (e.g., potential BIOSECURE Act), sanctions, and trade restrictions, which could increase costs, reduce supply, or disrupt the supply chain[335](index=335&type=chunk)[336](index=336&type=chunk)[337](index=337&type=chunk) [Risks Related to Employee Matters, Managing Growth and Other Risks Related to Our Business](index=71&type=section&id=Risks%20Related%20to%20Employee%20Matters%2C%20Managing%20Growth%20and%20Other%20Risks%20Related%20to%20Our%20Business) This section covers risks related to managing growth, retaining key personnel, operating in foreign markets, cybersecurity, and the impact of macroeconomic conditions - The company expects significant growth in employees and operations, which may be difficult to manage effectively given limited financial resources and management experience[341](index=341&type=chunk) - Success is highly dependent on **attracting and retaining key personnel**, including executive officers and scientific/clinical teams[342](index=342&type=chunk)[343](index=343&type=chunk) Loss of these individuals or inability to hire qualified personnel could impede strategic objectives[345](index=345&type=chunk) - Operating in foreign markets exposes the company to additional regulatory burdens, trade policy changes (e.g., U.S. tariffs), and reduced intellectual property protection[346](index=346&type=chunk)[347](index=347&type=chunk) - Estimates of market opportunity and growth forecasts may be inaccurate, and the business may not grow as anticipated, impacting revenue generation[348](index=348&type=chunk)[349](index=349&type=chunk) - Employees or third parties may engage in misconduct or improper activities, including noncompliance with regulatory standards, potentially leading to penalties, lawsuits, and reputational harm[350](index=350&type=chunk) - Internal IT systems and those of third parties are vulnerable to **security breaches and cyber-attacks**, including those enhanced by AI, which could result in data loss, liabilities, reputational damage, and operational disruptions[351](index=351&type=chunk)[353](index=353&type=chunk)[354](index=354&type=chunk)[355](index=355&type=chunk)[359](index=359&type=chunk)[360](index=360&type=chunk)[361](index=361&type=chunk) - The company's ability to use **net operating loss (NOL) carryforwards** and other tax attributes may be limited by ownership changes (Sections 382 and 383 of the Internal Revenue Code), potentially increasing future tax liability[363](index=363&type=chunk) - Failure of financial institutions where the company holds cash in excess of federally-insured limits could adversely affect its ability to pay operational expenses[369](index=369&type=chunk) [Risks Related to Our Common Stock](index=76&type=section&id=Risks%20Related%20to%20Our%20Common%20Stock) This section details risks associated with the company's common stock, including market price volatility, anti-takeover provisions, and potential future dilution - The market price of the common stock has been and may continue to be **volatile** due to factors such as regulatory approvals, commercial success, competition, financial projections, and macroeconomic conditions[370](index=370&type=chunk)[371](index=371&type=chunk) - **Anti-takeover provisions** in charter documents, Delaware law, and certain contracts (e.g., Series A Preferred Stock Certificate of Designation) could make an acquisition more difficult and prevent stockholder attempts to replace management[373](index=373&type=chunk)[374](index=374&type=chunk)[376](index=376&type=chunk) - The company does not anticipate paying cash dividends in the foreseeable future, meaning capital appreciation is the sole source of gain for stockholders[380](index=380&type=chunk) - Future sales and issuances of equity and debt, including under equity incentive plans, could result in **additional dilution to stockholders** and cause the stock price to fall[383](index=383&type=chunk)[384](index=384&type=chunk) - Principal stockholders own a significant percentage of the stock, enabling them to exert substantial control over matters requiring stockholder approval[385](index=385&type=chunk) [General Risk Factors](index=79&type=section&id=General%20Risk%20Factors) This section covers general risks such as product liability, litigation, compliance costs, internal control weaknesses, and macroeconomic impacts - The company is exposed to costly **product liability and professional indemnity risks**, and insurance coverage may not be sufficient to cover all damages from such claims[386](index=386&type=chunk) - Litigation, including securities, employment, or intellectual property matters, could result in substantial costs and divert resources, materially affecting the business[387](index=387&type=chunk) - As a public company, especially as a 'large accelerated filer' since December 31, 2024, the company incurs significant compliance costs and demands on management, including auditor attestation requirements under Sarbanes-Oxley Act Section 404(b)[388](index=388&type=chunk)[389](index=389&type=chunk) - A **material weakness in internal control over financial reporting** related to net earnings (loss) per share disclosures was identified in Q4 2024, leading to restatements of prior financial statements[391](index=391&type=chunk)[394](index=394&type=chunk) - **Macroeconomic conditions**, including inflation, interest rate increases, and geopolitical events (e.g., Russia-Ukraine, Middle East conflicts), could adversely affect operations, supply chains, and clinical trials, potentially causing delays and increased costs[397](index=397&type=chunk)[399](index=399&type=chunk)[400](index=400&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=82&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section confirms no unregistered sales of equity securities or use of proceeds were reported for the period - No unregistered sales of equity securities or use of proceeds are reported for the period[401](index=401&type=chunk) [Item 3. Defaults Upon Senior Securities](index=82&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section confirms no defaults upon senior securities occurred during the reporting period - No defaults upon senior securities are reported[402](index=402&type=chunk) [Item 4. Mine Safety Disclosures](index=82&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's operations - This item is not applicable[402](index=402&type=chunk) [Item 5. Other Information](index=83&type=section&id=Item%205.%20Other%20Information) This section provides information on Rule 10b5-1 trading arrangements for the company's Chief Executive Officer and Chief Medical Officer during the fiscal quarter ended June 30, 2025 - On June 20, 2025, **CEO Cameron Turtle terminated a previous Rule 10b5-1 trading plan** and adopted a new one to sell up to 360,000 shares of common stock by August 4, 2027[404](index=404&type=chunk) - On June 20, 2025, **CMO Sheldon Sloan adopted a Rule 10b5-1 trading plan** to sell up to 102,958 shares of common stock (to be acquired upon option exercise) by September 3, 2026[405](index=405&type=chunk) [Item 6. Exhibits](index=84&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed or furnished as part of this Quarterly Report on Form 10-Q, including key corporate and financial documents - The report includes exhibits such as the Agreement and Plan of Merger, Amended and Restated Certificate of Incorporation and Bylaws, Certificates of Designation for Series A and B Preferred Stock, and forms of Parapyre Warrants[408](index=408&type=chunk) - Certifications from the Principal Executive Officer and Principal Financial Officer (Exhibits 31.1, 31.2, 32.1) are furnished as part of the report[408](index=408&type=chunk) [Signatures](index=86&type=section&id=Signatures) This section contains the official signatures, duly authorized, for the Quarterly Report on Form 10-Q - The report is signed by **Scott Burrows, Chief Financial Officer** (Principal Financial Officer and Principal Accounting Officer), on behalf of Spyre Therapeutics, Inc. on August 5, 2025[412](index=412&type=chunk)[413](index=413&type=chunk)

Core Insights - Spyre Therapeutics reported positive interim Phase 1 results for two next-generation TL1A antibodies, indicating they were well-tolerated and supported quarterly or biannual dosing with full TL1A engagement for up to 20 weeks [1][2] - The company initiated the Phase 2 SKYLINE-UC platform study to evaluate three optimized monotherapies and three potentially paradigm-changing combinations for ulcerative colitis [1][3] - Spyre is on track to begin the Phase 2 SKYWAY-RD basket study for TL1A inhibition in rheumatoid arthritis, psoriatic arthritis, and axial spondyloarthritis in Q3 2025 [1][10] - The company has a strong cash position of $526.6 million as of June 30, 2025, with an expected runway into the second half of 2028 [1][11] Development Pipeline Overview - Spyre's approach combines advanced antibody engineering, dose optimization, and rational therapeutic combinations to enhance efficacy and convenience in treating inflammatory bowel disease (IBD) and other immune-mediated diseases [3][15] - IBD affects approximately 2.4 million individuals in the U.S., while rheumatoid arthritis (RA), psoriatic arthritis (PsA), and axial spondyloarthritis (axSpA) affect over 1.5 million and nearly 3 million individuals, respectively [3][4] Financial Performance - Research and Development (R&D) expenses for Q2 2025 totaled $40.1 million, up from $32.6 million in Q2 2024, primarily due to increased clinical trial expenses [12] - General and Administrative (G&A) expenses were $11.8 million for Q2 2025, slightly higher than $11.5 million in Q2 2024 [12] - The net loss for Q2 2025 was $36.7 million, compared to a net loss of $38.8 million in Q2 2024, including non-cash stock-based compensation expenses [14][24]

Company Overview - Spyre Therapeutics anticipates 9 proof-of-concept readouts in 2026-27 for IBD and beyond[6, 113] - The company had $565 million in cash as of March 31, 2025, with an expected runway into the second half of 2028[8] - Spyre's next-generation antibodies are engineered to match or exceed the potency of first-generation molecules[13] Clinical Trials and Programs - SKYLINE-UC Phase 2 platform study is evaluating SPY001, SPY002, SPY003 and pairwise combinations in ulcerative colitis[35, 68] - SKYWAY-RD Phase 2 basket trial is evaluating SPY072 in rheumatoid arthritis, psoriatic arthritis, and axial spondyloarthritis, with initiation anticipated in Q3 2025[37, 38] - The company is transitioning to a mid-stage development company with two innovative Phase 2 clinical trials[35] Pipeline and Target Profiles - SPY001, SPY002, and SPY003 are being developed with a target profile of 2-4 chronic doses per year[26] - Spyre is developing potential paradigm-changing combination therapies in IBD, such as SPY120 (α4β7+TL1A), SPY130 (α4β7+IL-23), and SPY230 (TL1A+IL-23)[28, 29] - SPY072 is a potential first-in-class anti-TL1A for rheumatologic conditions, targeting Q3M-Q6M dosing[12, 34] Market and Unmet Needs - Approximately 24 million individuals in the U S are diagnosed with IBD (~1 3M UC and ~1 0M CD)[44] - Over 3 million individuals in the U S are diagnosed with RA (>1 5M), PsA (~1M), and axSpA (~1M)[80]

Pipeline and Strategy - Spyre Therapeutics is developing next-generation monotherapies and paradigm-changing combinations for IBD and beyond, with potential subcutaneous Q3M-Q6M dosing [6] - The company's portfolio aims for superior efficacy and convenience compared to existing IBD biologics, potentially breaking the efficacy ceiling with combinations [7, 8] - Spyre's MOAs were rationally chosen based on attractive risk-benefit profiles, targeting an ~$8B 2030 IBD sales market for α4β7 and a ~$7B market for TL1A [11] SPY Programs and Clinical Development - SPY001 has a half-life of >90 days, exceeding expectations, and showed target engagement in Phase 1, with potential for twice-yearly maintenance dosing [18, 25] - SPY002 has a half-life of ~24 days in NHP PK studies, while Tulisokibart has a half-life of ~12 days [18] - SPY003 has a half-life of ~30 days in NHP PK studies, while Risankizumab has a half-life of ~9 days [18] - A Phase 2 platform trial is planned to enable multiple placebo-controlled readouts of monotherapies and combinations in ulcerative colitis, with ~600 patients [33, 34] TL1A and Rheumatoid Arthritis - TL1A is implicated in a wide range of human diseases, including Rheumatoid Arthritis (RA), where it is elevated in patients and exacerbates arthritis in murine models [41, 44, 46] - Spyre's anti-TL1A antibody (SPY002) meets or exceeds the efficacy of etanercept (anti-TNF) in rat models of RA [49]

Summary of Spyre Therapeutics Inc (SYRE) Update / Briefing June 17, 2025 Company Overview - **Company**: Spyre Therapeutics Inc (SYRE) - **Focus**: Development of next-generation anti-TL1A antibodies for inflammatory bowel disease (IBD) and rheumatologic diseases Key Points and Arguments Phase I Clinical Trial Results - Positive interim results for two anti-TL1A molecules (SPY-two and SPY-seventy two) were announced, indicating favorable safety profiles and complete target engagement at low doses [2][5][21] - Both molecules demonstrated a half-life of approximately 75 days for SPY-two, supporting quarterly or biannual dosing [16][21] - The trials showed low rates of adverse events, with no serious adverse events reported [14][21] Phase II Development Plans - Plans to advance SPY-two into the Skyline UC study and SPY-seventy two into the Skyway RD study [22][31] - The Skyline UC study will explore safety and efficacy of three long-acting monotherapies and three combination therapies in ulcerative colitis [5][10] - The Skyway RD study will evaluate SPY-seventy two in three rheumatologic diseases, leveraging a basket design for efficiency [31][32] Market Potential and Value Creation - The development plan targets markets with over $60 billion in annual revenue, with multiple paths to substantial value creation [11] - The company aims to address unmet needs in IBD and rheumatologic diseases, potentially transforming treatment paradigms with innovative therapies [6][28] Study Design and Efficiency - The innovative platform and basket designs of the studies are expected to provide 35% to 40% cost savings compared to separate studies [10][33] - The Skyline UC study is designed to require 40% fewer patients, enhancing operational efficiency [26][27] Immunogenicity and Safety - Ongoing analysis of anti-drug antibodies (ADA) shows no apparent impact on pharmacokinetics (PK) or pharmacodynamics (PD) [60][92] - The company believes its combination therapies will have superior safety profiles compared to existing treatments, particularly those with known safety issues [61][82] Future Catalysts - Anticipated readouts include open-label results from the Skyline UC study in 2026 and placebo-controlled results for SPY-seventy two in 2026 [39][80] - The company is well-funded to execute its studies, with a cash runway extending into the second half of 2028 [39] Additional Important Content - The company emphasizes the potential for its anti-TL1A antibodies to provide improved options for patients and physicians, with a focus on both efficacy and convenience [6][28] - The design of the studies is patient-centric, aiming to reduce operational complexity and enhance patient recruitment [27][28] - The company is exploring the role of TL1A in rheumatologic diseases, supported by preclinical evidence of its efficacy [31][36] This summary captures the essential information from the conference call, highlighting the company's strategic direction, clinical trial results, and future plans.

Clinical Trial Updates - SPY002 and SPY072 met Phase 1 objectives, and the company plans to advance both into Phase 2[18] - The company is launching SKYLINE-UC, a Phase 2 platform study in ulcerative colitis evaluating three monotherapies and three combinations[11, 58] - The company is unveiling SKYWAY-RD, a Phase 2 basket study evaluating anti-TL1A in three rheumatologic conditions[11, 75] - The company anticipates 9 proof-of-concept readouts in 2026-27 for the treatment of IBD and beyond[25, 103] SPY002 and SPY072 Phase 1 Results - In a Single Ascending Dose (SAD) study, 11 out of 40 (28%) subjects in the SPY002 group experienced at least one Treatment Emergent Adverse Event (TEAE)[36] - In a Single Ascending Dose (SAD) study, 14 out of 40 (35%) subjects in the SPY072 group experienced at least one Treatment Emergent Adverse Event (TEAE)[38] - SPY002 demonstrated an approximate 75-day half-life[40, 42] - SPY002 and SPY072 suppressed free TL1A through 20-weeks of follow-up at the lowest dose tested[43] Trial Design and Cost Efficiency - The Phase 2 platform trial in UC is expected to achieve 40% cost savings compared to individual Phase 2 studies[24] - The Phase 2 basket trial in rheumatological diseases is expected to achieve 35% cost savings compared to individual Phase 2 studies[24] Financial Runway - The company has $565 million cash with runway into the second half of 2028[103]

Core Insights - Spyre Therapeutics announced positive interim Phase 1 results for SPY002 and SPY072, two novel monoclonal antibodies targeting TL1A, indicating their potential as next-generation therapies for immune-mediated diseases [1][2][3] Clinical Trials and Results - SPY002 and SPY072 met all Phase 1 objectives, demonstrating safety and tolerability with single doses up to 1500 mg, and a prolonged half-life of approximately 75 days, which is over three times greater than first-generation anti-TL1A antibodies [2][9] - The SKYLINE-UC platform trial for ulcerative colitis was initiated in May 2025, evaluating optimized monotherapies and combinations [1][3] - The SKYWAY-RD basket trial for SPY072 in rheumatoid arthritis, psoriatic arthritis, and axial spondyloarthritis is expected to begin in Q3 2025 [1][4] Future Development Plans - The company plans to advance SPY002 into the SKYLINE-UC trial and initiate the SKYWAY-RD trial for SPY072, with expectations for multiple proof-of-concept data readouts in 2026 and 2027 [3][5][7] - The SKYLINE-UC trial will include SPY001, SPY002, SPY003, and their combinations under a single master protocol [3][8] Market Potential - The company is well-funded with a cash runway extending into the second half of 2028, aiming to deliver nine proof-of-concept readouts in markets exceeding $60 billion in annual revenue [7][14]

Company Overview - Spyre Therapeutics, Inc. is a clinical-stage biotechnology company focused on developing next-generation products for inflammatory bowel disease (IBD) and other immune-mediated diseases through advanced antibody engineering and therapeutic combinations [3]. Upcoming Events - The company will report interim results from the Phase 1 SPY002 healthy volunteer trials on June 17, 2025, and will host a conference call and webcast at 8:00 am ET to discuss these results [1]. Product Pipeline - Spyre's pipeline includes investigational extended half-life antibodies targeting α4β7, TL1A, and IL-23, which are aimed at treating IBD and other immune-mediated diseases [3].

Summary of Spyre Therapeutics Inc (SYRE) FY Conference Call Company Overview - **Company**: Spyre Therapeutics Inc (SYRE) - **Industry**: Biotechnology, specifically focusing on inflammatory bowel disease (IBD) treatments - **Market Size**: IBD affects approximately 2 million people in the US, with a global market size of $30 billion [3][2] Core Points and Arguments Unmet Needs in IBD - Current therapies have a therapeutic ceiling with a maximum clinical remission rate of about 25% [3] - Existing treatments require frequent dosing (every two weeks or intravenous) [3] - Spyre aims to address both efficacy and convenience by developing long-acting therapies that can be dosed twice a year [4] Product Development Strategy - Spyre's antibodies are engineered for extended half-lives, allowing for less frequent dosing [4] - The company focuses on combination therapies to enhance efficacy beyond what individual therapies can achieve [4][11] - Three primary targets identified for IBD therapies: alpha four beta seven, TL1A, and IL-23 [10][11] Competitive Landscape - Alpha four beta seven (Entyvio) is currently the leading product in IBD with projected peak sales of $8 billion [12] - Spyre's lead program (SPI-1 targeting alpha four beta seven) shows a half-life more than three times that of Entyvio, allowing for potential dosing twice a year [13][14] - TL1A is expected to show superior monotherapy efficacy compared to existing biologics [11][25] Clinical Development Plans - Spyre plans to conduct a multi-arm phase two study to test monotherapies and combinations efficiently [30][31] - The company has a robust pipeline with multiple candidates in development, including TL1A and IL-23 [42] Market Potential and Differentiation - The company believes that its long-acting injectable combinations will provide a better product profile compared to existing therapies [59] - The potential for quarterly or semiannual dosing is expected to be preferred over daily oral medications, especially in a young patient demographic [63][64] Financial Position - Spyre has $565 million in cash, providing a runway into the second half of 2028, with multiple phase two readouts expected before 2027 [69] Other Important Content - The company is leveraging the recent expiration of YTE intellectual property to develop its therapies without licensing issues [61] - There is a significant unmet need in rheumatoid arthritis (RA), with a $20 billion market size, where TL1A could provide a competitive edge [35] - The company is aware of the challenges posed by biosimilars in the RA market but believes its unique product profile will attract physicians and patients [36] This summary encapsulates the key points discussed during the conference call, highlighting Spyre Therapeutics' strategic focus, product development, market potential, and financial health.