Core Insights - Upstream Bio, Inc. has appointed Stacy Price as Chief Technology Officer to enhance its technical operations and product development for verekitug, a treatment for severe respiratory disorders [1][2] - The company is preparing to initiate a third clinical program for verekitug, which targets the receptor for thymic stromal lymphopoietin, a key driver of inflammatory responses [2][3] - Upstream Bio is committed to addressing unmet medical needs in severe respiratory diseases through the development of verekitug, which is currently in Phase 2 trials for severe asthma and chronic rhinosinusitis with nasal polyps [3] Company Overview - Upstream Bio is a clinical-stage biotechnology company focused on developing treatments for inflammatory diseases, particularly severe respiratory disorders [3] - The company is advancing verekitug, a monoclonal antibody that is the only known antagonist in clinical development targeting the receptor for thymic stromal lymphopoietin [3] - Upstream Bio aims to maximize the unique attributes of verekitug to meet the substantial unmet needs of patients underserved by current standard care [3]

[PART I. FINANCIAL INFORMATION](index=8&type=section&id=PART%20I.%2E%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=8&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) Presents the unaudited condensed consolidated financial statements for Upstream Bio, Inc., reporting a $27.3 million net loss and $431.4 million in cash and investments Condensed Consolidated Balance Sheet Data (in thousands) | | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $71,312 | $325,892 | | Short-term investments | $360,068 | $144,559 | | Total current assets | $453,787 | $479,160 | | Total assets | $456,169 | $481,719 | | **Liabilities and Stockholders' Equity** | | | | Total current liabilities | $9,567 | $10,737 | | Total liabilities | $10,559 | $11,867 | | Total stockholders' equity | $445,610 | $469,852 | | Accumulated deficit | $(218,050) | $(190,780) | Condensed Consolidated Statements of Operations (in thousands) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Collaboration revenue | $566 | $640 | | Research and development | $25,797 | $11,691 | | General and administrative | $6,782 | $3,962 | | Loss from operations | $(32,013) | $(15,013) | | Net loss | $(27,270) | $(10,894) | | Net loss per share, basic and diluted | $(0.51) | $(4.68) | Condensed Consolidated Statements of Cash Flows (in thousands) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(41,165) | $(17,562) | | Net cash provided by (used in) investing activities | $(213,381) | $13,852 | | Net cash provided by (used in) financing activities | $(34) | $9,387 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=31&type=section&id=Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Discusses the company's financial condition, operational results, and future outlook, highlighting increased R&D expenses and sufficient funding through 2027 - The company is advancing its sole product candidate, verekitug, into Phase 2 trials for severe asthma, CRSwNP, and COPD. Top-line data for the CRSwNP trial is expected in **Q3 2025**, and for the severe asthma trial in the **first half of 2026**[113](index=113&type=chunk) - Based on the current operating plan, the company believes its existing cash, cash equivalents, and short-term investments of **$431.4 million** as of March 31, 2025, will be sufficient to fund operating expenses and capital expenditure requirements through **2027**[115](index=115&type=chunk)[165](index=165&type=chunk) Comparison of Results of Operations (in thousands) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Collaboration revenue | $566 | $640 | $(74) | | Research and development | $25,797 | $11,691 | $14,106 | | General and administrative | $6,782 | $3,962 | $2,820 | | Loss from operations | $(32,013) | $(15,013) | $(17,000) | | Net loss | $(27,270) | $(10,894) | $(16,376) | - R&D expenses increased by **$14.1 million** YoY, primarily due to a **$5.7 million** increase for the COPD indication planning, a **$3.9 million** increase for the asthma indication's Phase 2 trial and LTE study planning, and a **$1.2 million** increase for the CRSwNP Phase 2 trial[148](index=148&type=chunk)[149](index=149&type=chunk) - General and administrative expenses increased by **$2.8 million** YoY, mainly due to a **$1.9 million** increase in personnel expenses from higher headcount and a **$0.6 million** increase in corporate insurance and occupancy costs[153](index=153&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=48&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Upstream Bio, Inc. is not required to provide the information for this item - The company is a smaller reporting company as defined in Rule 12b-2 under the Securities Exchange Act of 1934 and is not required to provide quantitative and qualitative disclosures about market risk[182](index=182&type=chunk) [Item 4. Controls and Procedures](index=48&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2025. There were no material changes in internal control over financial reporting during the quarter - Management concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of the end of the period covered by the report[184](index=184&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[185](index=185&type=chunk) [PART II. OTHER INFORMATION](index=49&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=49&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any litigation or legal proceedings that are expected to have a material adverse effect on its business - As of the report date, the company is not involved in any legal proceedings that management believes would have a material adverse effect on the business[188](index=188&type=chunk) [Item 1A. Risk Factors](index=49&type=section&id=Item%201A.%20Risk%20Factors) Outlines significant risks including limited operating history, dependence on a single product, funding needs, regulatory uncertainties, and reliance on third-party manufacturing - The company is a clinical-stage biopharmaceutical company with a limited operating history and a history of significant financial losses, which are expected to continue for the foreseeable future[192](index=192&type=chunk) - The company's business is entirely dependent on its only product candidate, verekitug. Any failure or significant delay in its development, regulatory approval, or commercialization would materially harm the business[205](index=205&type=chunk)[207](index=207&type=chunk) - The company will require additional funding to finance operations. Failure to raise capital when needed could force delays, reductions, or elimination of product development programs[197](index=197&type=chunk) - The regulatory approval processes of the FDA and other authorities are lengthy, time-consuming, and unpredictable. There is no guarantee that verekitug will obtain regulatory approval[243](index=243&type=chunk) - The company relies on third parties, such as WuXi Biologics, for manufacturing. Potential U.S. legislation like the BIOSECURE Act could materially impact its agreement with key Chinese manufacturing partners[314](index=314&type=chunk)[459](index=459&type=chunk) - The company faces risks related to the adoption and use of artificial intelligence (AI), including security risks to confidential information and an uncertain regulatory environment, such as the EU's AI Act[239](index=239&type=chunk)[240](index=240&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=146&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities during the period. There has been no material change in the planned use of proceeds from the company's Initial Public Offering (IPO) as described in the final prospectus - There has been no material change in the planned use of proceeds from the IPO declared effective on October 10, 2024[480](index=480&type=chunk) [Item 5. Other Information](index=146&type=section&id=Item%205.%20Other%20Information) During the quarter ended March 31, 2025, none of the company's directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement - No director or officer adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement in Q1 2025[484](index=484&type=chunk)

[Upstream Bio First Quarter 2025 Report](index=1&type=section&id=Upstream%20Bio%20First%20Quarter%202025%20Report) [Clinical Program Highlights](index=1&type=section&id=Clinical%20Program%20Highlights) The company announced accelerated clinical timelines for verekitug, its TSLP receptor-targeting monoclonal antibody - **Verekitug is the only monoclonal antibody** in clinical development that targets and inhibits the thymic stromal lymphopoietin (TSLP) receptor[1](index=1&type=chunk)[2](index=2&type=chunk) - Top-line data from the Phase 2 clinical trial in patients with CRSwNP is now expected in the **third quarter of 2025**, accelerated from previous guidance[1](index=1&type=chunk)[2](index=2&type=chunk)[3](index=3&type=chunk) - Top-line data from the Phase 2 clinical trial in patients with severe asthma is now expected in the **first half of 2026**[1](index=1&type=chunk)[2](index=2&type=chunk)[4](index=4&type=chunk) - The first patient in the Phase 2 clinical trial for COPD is expected to be dosed in **mid-2025**[1](index=1&type=chunk)[2](index=2&type=chunk)[4](index=4&type=chunk) - The clinical trials for CRSwNP, severe asthma, and COPD are designed with endpoints that could **potentially support submissions for product approval**, pending regulatory discussions[3](index=3&type=chunk)[4](index=4&type=chunk) [First Quarter 2025 Financial Results](index=2&type=section&id=First%20Quarter%202025%20Financial%20Results) The company reported a higher net loss of $27.3 million driven by increased R&D expenses but maintains a strong cash position of $431.4 million - As of March 31, 2025, cash, cash equivalents, and short-term investments totaled **$431.4 million**, which is expected to fund planned operations through 2027[5](index=5&type=chunk) Q1 2025 vs. Q1 2024 Financial Highlights | Financial Metric | Q1 2025 (in millions) | Q1 2024 (in millions) | Change | | :--- | :--- | :--- | :--- | | Research and Development Expenses | $25.8 | $11.7 | +$14.1 | | General and Administrative Expenses | $6.8 | $4.0 | +$2.8 | | Net Loss | $27.3 | $10.9 | +$16.4 | - The increase in R&D expenses was primarily driven by **higher clinical and manufacturing costs** for the verekitug program[5](index=5&type=chunk) - The rise in G&A expenses was mainly due to **increased personnel-related costs**, including share-based compensation, and professional service fees[6](index=6&type=chunk) [Upcoming Events](index=2&type=section&id=Upcoming%20Events) The company will participate in two key healthcare and immunology conferences in June 2025 - The company will present at the **Goldman Sachs 46th Annual Global Healthcare Conference** on June 11, 2025[8](index=8&type=chunk) - The company will participate in the **European Academy of Allergy and Clinical Immunology (EAACI) Congress** in Glasgow, United Kingdom, from June 13-16, 2025[9](index=9&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) This section presents the unaudited condensed consolidated balance sheet and statement of operations as of March 31, 2025 [Condensed Consolidated Balance Sheet](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheet) Total assets decreased to $456.2 million as of March 31, 2025, primarily due to cash used in operations Balance Sheet Summary (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $71,312 | $325,892 | | Short-term investments | $360,068 | $144,559 | | **Total Assets** | **$456,169** | **$481,719** | | Total Liabilities | $10,559 | $11,867 | | **Total Stockholders' Equity** | **$445,610** | **$469,852** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company reported a net loss of $27.3 million for the quarter, a significant increase from the prior-year period due to higher operating expenses Statement of Operations Summary (in thousands) | Account | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Collaboration revenue | $566 | $640 | | Research and development | $25,797 | $11,691 | | General and administrative | $6,782 | $3,962 | | Loss from operations | $(32,013) | $(15,013) | | Interest income | $4,743 | $1,266 | | **Net loss** | **$(27,270)** | **$(10,894)** |

Core Insights - Upstream Bio is advancing its clinical development of verekitug, a monoclonal antibody targeting the TSLP receptor, with key data readouts expected in the near future [1][2][3] Clinical Development Updates - Top-line data from the Phase 2 clinical trial of verekitug in patients with chronic rhinosinusitis with nasal polyps (CRSwNP) is expected in the third quarter of 2025 [1][3] - Top-line data from the Phase 2 clinical trial in severe asthma is now anticipated in the first half of 2026 [1][3] - The first patient in the Phase 2 clinical trial for chronic obstructive pulmonary disease (COPD) is expected to be dosed in mid-2025 [1][3][4] Financial Performance - As of March 31, 2025, Upstream Bio reported cash, cash equivalents, and short-term investments totaling $431.4 million, which is projected to fund operations through 2027 [5] - Research and development expenses for Q1 2025 were $25.8 million, a significant increase from $11.7 million in Q1 2024, primarily due to clinical and manufacturing costs related to verekitug [5] - General and administrative expenses rose to $6.8 million in Q1 2025 from $4.0 million in the same period in 2024, driven by personnel-related costs and professional service fees [6] - The net loss for Q1 2025 was $27.3 million, compared to a net loss of $10.9 million in Q1 2024, largely due to increased operating expenses [7] Business Strategy - Upstream Bio is focused on addressing unmet needs in severe respiratory diseases through its unique mechanism of action with verekitug, which is the only known molecule in clinical development targeting the TSLP receptor [2][8]

Group 1 - The marketplace channel Haggerston BioHealth offers exclusive stock tips focused on Pharma, Biotech, and Healthcare, providing access to investment bank-grade financial models and research [1] - The group caters to both novice and experienced biotech investors, offering insights on catalysts, buy and sell ratings, product sales forecasts, and integrated financial statements [2] - Edmund Ingham, a biotech consultant with over 5 years of experience, leads the Haggerston BioHealth investing group and has compiled detailed reports on over 1,000 companies [2]

Financial Performance - The company reported net losses of $62.8 million and $20.5 million for the years ended December 31, 2024 and 2023, respectively, with an accumulated deficit of $190.8 million as of December 31, 2024[587]. - The net loss for the year ended December 31, 2024 was $62.8 million, compared to a net loss of $20.5 million in 2023, reflecting an increase of $42.3 million[615]. - The company expects to continue incurring significant net operating losses for the foreseeable future, depending on the timing of expenditures on research and development activities[588]. - The company has incurred significant net operating losses and negative cash flows since inception, indicating a need for additional financing to support ongoing operations[590]. Cash and Investments - The company has cash, cash equivalents, and short-term investments totaling $470.5 million, which are expected to fund operations through 2027[587]. - As of December 31, 2024, the company had cash, cash equivalents, and short-term investments totaling $470.5 million[626]. - The company believes its existing cash, cash equivalents, and short-term investments will fund operating expenses through 2027[638]. Initial Public Offering (IPO) - The company completed its IPO in October 2024, issuing 17,250,000 shares at a public price of $17.00 per share, resulting in net proceeds of $268.8 million after deducting underwriting discounts and commissions[586]. Research and Development - The company is developing verekitug, currently in Phase 2 trials for severe asthma and chronic rhinosinusitis with nasal polyps, with top-line data expected in the second half of 2025 and 2026, respectively[585]. - Research and development expenses are expected to increase as the company advances verekitug through clinical trials, with higher costs anticipated in later stages of development[603]. - Research and development expenses increased to $63.0 million in 2024 from $31.8 million in 2023, driven by a $23.8 million increase in expenses for the verekitug program[617]. - The company expects increased research and development and general administrative expenses as it advances its product candidates through clinical trials[635]. - The company incurred approximately $51.0 million in direct external expenses for the development of verekitug for severe asthma since its nomination[621]. Revenue and Collaboration - The company has not generated any revenue from product sales and does not expect to do so in the foreseeable future, relying on collaboration revenue from the Maruho License Agreement[601]. - Collaboration revenue from related parties was $2.4 million for both years ended December 31, 2024 and 2023, primarily related to clinical trials for severe asthma[616]. Operating Expenses - The total operating expenses for 2024 were $80.1 million, up from $42.5 million in 2023, marking an increase of $37.6 million[615]. - General and administrative expenses rose to $17.2 million in 2024 from $10.7 million in 2023, with personnel expenses increasing by $4.5 million due to higher headcount[622]. - The company expects general and administrative expenses to increase in the future as it expands its infrastructure and headcount to support ongoing research and development[609]. Financing Activities - The company has received total gross proceeds of $400.0 million from the issuance of Series A and Series B redeemable convertible preferred stock[586]. - The company anticipates financing operations through equity offerings, debt financings, and collaborations until substantial product revenue is generated[639]. - The company provided $129.6 million in net cash from financing activities during the year ended December 31, 2023, including $80.0 million from the issuance of Series A Preferred Stock[634]. Lease and Payments - The company entered into a three-year lease agreement for office space with an initial base rent of approximately $0.7 million for the first year[648]. - The company has made annual payments to Lonza of $0.5 million and $0.4 million for the years ended December 31, 2024 and 2023, respectively, related to the Lonza License Agreement[600]. - Annual payments to Lonza under the Lonza License Agreement were $0.4 million for the year ended December 31, 2023[647]. Stock and Valuation - The company issued stock option awards with performance-based vesting conditions to key executives, with stock-based compensation recognized upon achievement of performance conditions in February 2023 and April 2024[657]. - Prior to the IPO in October 2024, the estimated fair value of the company's common stock was determined by the board of directors, considering third-party valuations and other relevant factors[658]. - The company classified Series A and Series B preferred stock tranche rights as liabilities, initially recorded at fair value upon issuance[659]. - Changes in the fair value of preferred stock tranche right liabilities were recognized as a component of other income in the consolidated statements of operations until settled[660]. - The fair value of Series A preferred stock tranche right liability was determined using a probability-weighted expected return method, with significant assumptions impacting valuation[663]. - The fair value of Series B preferred stock tranche right liability was determined using an option pricing model, with the fair value of Series B Preferred Stock as a key assumption[664]. Regulatory and Reporting Status - The company is classified as a "smaller reporting company," with a market value of common stock held by non-affiliates less than $700 million and annual revenue below $100 million[668]. - The company has elected not to "opt out" of the extended transition period for new accounting standards, which may affect comparability with other public companies[667]. - The company may continue to rely on exemptions from certain disclosure requirements as a smaller reporting company, including reduced obligations regarding executive compensation[668]. - The company is not required to provide quantitative and qualitative disclosures about market risk due to its status as a smaller reporting company[669].

Clinical Trials - Upstream Bio completed enrollment in its Phase 2 clinical trial of verekitug for chronic rhinosinusitis with nasal polyps (CRSwNP) in January 2025, with top-line data expected in the second half of 2025[4]. - The company plans to initiate dosing of the first patient in its COPD program in the second half of 2025 and expects to report top-line data from the severe asthma trial in the second half of 2026[3]. Financial Performance - The net loss for Q4 2024 was $21.2 million, compared to a net loss of $11.8 million in Q4 2023, an increase of 80% attributed to higher operating expenses[7]. - Research and development expenses for Q4 2024 were $21.8 million, a 87.9% increase from $11.6 million in Q4 2023, primarily due to clinical and manufacturing costs related to the verekitug program[5]. - General and administrative expenses rose to $5.2 million in Q4 2024, compared to $3.2 million in Q4 2023, reflecting increased personnel-related costs[6]. - Total operating expenses for the year ended December 31, 2024, were $80.1 million, significantly higher than $42.5 million for the year ended December 31, 2023[18]. Funding and Investments - Upstream Bio raised approximately $293 million in gross proceeds from its upsized initial public offering (IPO) completed in October 2024[9]. - The company reported cash, cash equivalents, and short-term investments of $470.5 million as of December 31, 2024, which is projected to fund operations through 2027[5]. - Upstream Bio's total assets increased to $481.7 million as of December 31, 2024, compared to $117.2 million in 2023[16]. Leadership and Management - The company appointed key members to its Board of Directors and management team, enhancing its leadership in the biotechnology sector[9].

Core Insights - Upstream Bio, Inc. has completed enrollment in its Phase 2 clinical trial of verekitug for chronic rhinosinusitis with nasal polyps (CRSwNP), with top-line data expected in the second half of 2025 [1][2] - The company successfully completed an upsized IPO, raising approximately $293 million, which will extend its operational runway through 2027 [1][6] - Upstream is advancing verekitug, a monoclonal antibody targeting the TSLP receptor, in multiple severe respiratory diseases including CRSwNP, severe asthma, and chronic obstructive pulmonary disease (COPD) [1][10] Clinical Development - The Phase 2 trial for CRSwNP is designed to assess the efficacy and safety of verekitug, with patients receiving either 100 mg of the drug or a placebo every 12 weeks over a 24-week period [4] - The primary endpoint of the trial is the change in nasal polyp score (NPS) at week 24, with secondary endpoints including nasal congestion score and time to systemic corticosteroids or surgery [4] - Upstream plans to initiate dosing for its COPD program in the second half of 2025 and expects to report data from the severe asthma trial in the second half of 2026 [3] Financial Performance - As of December 31, 2024, Upstream had cash, cash equivalents, and short-term investments totaling $470.5 million, sufficient to fund operations through 2027 [7] - Research and development expenses for Q4 2024 were $21.8 million, up from $11.6 million in Q4 2023, primarily due to increased clinical and manufacturing costs related to verekitug [7] - The net loss for Q4 2024 was $21.2 million, compared to a net loss of $11.8 million in the same period of 2023, driven by higher operating expenses [9][18] Management and Governance - Upstream made key additions to its Board of Directors and management team, including the appointment of Daniella Beckman as an independent director and chair of the Audit Committee [6] - Allison Ambrose was appointed as General Counsel, bringing extensive legal experience from other biotech companies [6] Upcoming Events - Upstream plans to participate in investor conferences, including the Leerink Partners Global Biopharma Conference and the Piper Sandler Spring Biopharma Symposium [13]

Company Overview - Upstream Bio, Inc. is a clinical-stage biotechnology company focused on developing treatments for inflammatory diseases, particularly severe respiratory disorders [2] - The company is advancing verekitug, a monoclonal antibody targeting the receptor for thymic stromal lymphopoietin, which is involved in inflammatory responses [2] - Verekitug is currently in separate Phase 2 trials for severe asthma and chronic rhinosinusitis with nasal polyps, with plans to initiate development for chronic obstructive pulmonary disease [2] Upcoming Events - Rand Sutherland, MD, CEO of Upstream Bio, will present at the TD Cowen 45th Annual Health Care Conference on March 4, 2025, from 11:50 a.m. to 12:20 p.m. ET [3] - The company will also participate in the Leerink Partners Global Biopharma Conference on March 12, 2025, from 1:40 p.m. to 2:10 p.m. ET [3] - A live webcast of the presentations will be available on the company's website, with replays posted afterward [1]

Company Overview - Upstream Bio, Inc. is a clinical-stage biotechnology company focused on developing treatments for inflammatory diseases, particularly severe respiratory disorders [2] - The company is advancing verekitug, a monoclonal antibody targeting the receptor for thymic stromal lymphopoietin, which is involved in inflammatory responses [2] - Verekitug is currently in separate Phase 2 trials for severe asthma and chronic rhinosinusitis with nasal polyps, with plans to initiate development for chronic obstructive pulmonary disease [2] Upcoming Events - Rand Sutherland, MD, MPH, the CEO of Upstream Bio, will present at the 43rd Annual J.P. Morgan Healthcare Conference on January 13, 2025, at 2:15 p.m. PT [1] - A live webcast of the presentation will be available on the company's website, with a replay posted afterward [1]