Tango Therapeutics(TNGX) - 2025 Q2 - Quarterly Report

FORM 10-Q Filing Information This section details the Quarterly Report on Form 10-Q for Tango Therapeutics, Inc., covering the period ended June 30, 2025, including its Nasdaq listing and filer status Filing Details This document is a Quarterly Report on Form 10-Q for Tango Therapeutics, Inc., covering the period ended June 30, 2025 - The report is a Quarterly Report on Form 10-Q for the period ended June 30, 2025[2] - Tango Therapeutics, Inc. is incorporated in Delaware[2] Title of each class | Title of each class | Symbol(s) | Name of each exchange on which registered | | :------------------ | :-------- | :---------------------------------------- | | Common stock, par value $0.001 per share | TNGX | Nasdaq Global Market | Securities and Registrant Status Tango Therapeutics, Inc. is classified as a large accelerated filer and is not a shell company, with 111,260,247 shares outstanding as of July 29, 2025 Large accelerated filer | Large accelerated filer | ☒ | | :---------------------- | :--- | | Non-accelerated filer | ☐ | - The registrant is not a shell company[4] - As of July 29, 2025, 111,260,247 shares of common stock were outstanding[4] Table of Contents The Table of Contents outlines the structure of the Quarterly Report on Form 10-Q, dividing it into two main parts Summary of Material Risks Associated with Our Business Tango Therapeutics faces significant risks including limited operating history, no product sales, substantial competition, and anticipated net losses requiring additional funding - The company is a precision oncology company with a limited operating history, no approved products for commercial sale, and has not generated revenue from product sales, anticipating continued net losses[9] - Significant additional funding will be required, and inability to raise capital could force delays or elimination of product development programs[9] - Clinical product development is a lengthy and expensive process with uncertain outcomes, and results from earlier preclinical studies are not necessarily predictive of later clinical trials[9] Note Regarding Forward-Looking Statements The report contains forward-looking statements regarding clinical trials, funding, regulatory approvals, and financial performance, subject to risks and uncertainties - The report contains forward-looking statements that are not guarantees of future performance and are subject to risks, uncertainties, and assumptions[11] - Forward-looking statements include expectations regarding the initiation, timing, progress, results, and cost of research and development programs and clinical trials, including specific programs like TNG462 and TNG260[11][13] - Other forward-looking statements relate to the ability to obtain funding, regulatory approval, commercialize products, protect intellectual property, and estimates of future expenses and capital requirements[13] USE OF DEFINED TERMS IN THIS QUARTERLY REPORT ON FORM 10-Q This section defines key terms, company references, medical acronyms, and collaborators to ensure consistent understanding throughout the report - Key terms defined include 'the Company' (Tango Therapeutics, Inc. and its subsidiaries), 'Business Combination' (merger on August 10, 2021), and various medical/regulatory acronyms like 'CNS', 'FDA', 'IND', 'MTAP', and 'PRMT5'[16][24] Corporate Information This section provides background on Tango Therapeutics, including its incorporation, SEC filing availability, website information, and principal executive office location Company Background Tango Therapeutics, Inc. was originally incorporated as BCTG Acquisition Corp., a SPAC, in May 2020, and changed its name after a merger in August 2021 - Tango Therapeutics, Inc. was formerly BCTG Acquisition Corp., a SPAC, incorporated in Delaware in May 2020[19] - The company consummated a merger on August 10, 2021, and subsequently changed its name to Tango Therapeutics, Inc[19] SEC Filings and Website Information Tango Therapeutics makes its SEC filings available free of charge on its website, which is also used for disclosing material non-public information - Annual, Quarterly, and Current Reports (10-K, 10-Q, 8-K) are available on the 'Investors' section of the company's website (http://www.tangotx.com) free of charge[20] - The company's website is used as a means of disclosing material non-public information and for complying with SEC Regulation FD[21] Principal Executive Office The principal executive office of Tango Therapeutics, Inc. is located at 201 Brookline Avenue, Suite 901, Boston, Massachusetts 02215 - The principal executive office is located at 201 Brookline Avenue, Suite 901, Boston, Massachusetts 02215[22] PART I. FINANCIAL INFORMATION 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) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, equity, and cash flows Condensed Consolidated Balance Sheets As of June 30, 2025, total assets decreased to $237.9 million, total liabilities decreased to $102.9 million, and total stockholders' equity declined to $135.0 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Item | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Cash and cash equivalents | $39,272 | $69,530 | | Marketable securities | $141,513 | $188,387 | | Total current assets | $190,100 | $266,343 | | Total assets | $237,890 | $316,492 | | Total current liabilities | $40,025 | $38,170 | | Total liabilities | $102,936 | $116,975 | | Total stockholders' equity | $134,954 | $199,517 | - Cash and cash equivalents decreased by $30.258 million from December 31, 2024 to June 30, 2025[27] - Marketable securities decreased by $46.874 million from December 31, 2024 to June 30, 2025[27] Condensed Consolidated Statements of Operations and Comprehensive Loss For Q2 2025, net loss increased to $38.9 million, and total revenue significantly decreased to $3.2 million due to the absence of license revenue Condensed Consolidated Statements of Operations and Comprehensive Loss Highlights (in thousands, except per share) | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Collaboration revenue | $3,181 | $7,775 | $8,573 | $14,246 | | License revenue | $0 | $12,100 | $0 | $12,100 | | Total revenue | $3,181 | $19,875 | $8,573 | $26,346 | | Research and development | $32,807 | $38,654 | $69,249 | $76,719 | | General and administrative | $11,341 | $10,773 | $22,821 | $21,434 | | Net loss | $(38,853) | $(25,551) | $(78,729) | $(63,465) | | Net loss per common share – basic and diluted | $(0.35) | $(0.24) | $(0.71) | $(0.58) | - Net loss increased to $38.9 million for Q2 2025 from $25.6 million for Q2 2024, and to $78.7 million for H1 2025 from $63.5 million for H1 2024[29] - Total revenue decreased significantly by $16.7 million for Q2 2025 and $17.8 million for H1 2025, primarily due to the absence of license revenue in 2025[29] Condensed Consolidated Statements of Stockholders' Equity Total stockholders' equity decreased from $199.5 million at December 31, 2024, to $135.0 million at June 30, 2025, primarily due to net losses Stockholders' Equity Changes (in thousands) | Item | Balance at Dec 31, 2024 | Balance at June 30, 2025 | | :-------------------------------- | :---------------------- | :----------------------- | | Common Stock Amount | $108 | $111 | | Additional Paid-in Capital | $700,631 | $715,036 | | Accumulated Other Comprehensive Income | $336 | $94 | | Accumulated Deficit | $(501,558) | $(580,287) | | Total Stockholders' Equity | $199,517 | $134,954 | - Net loss for the six months ended June 30, 2025, was $78.7 million, contributing to the decrease in total stockholders' equity[31] - Stock-based compensation expense for the six months ended June 30, 2025, was $13.8 million[31] Condensed Consolidated Statements of Cash Flows Net cash used in operating activities increased to $78.2 million for H1 2025, while investing activities provided $47.4 million, and financing activities provided $0.6 million Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Item | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(78,216) | $(61,464) | | Net cash provided by investing activities | $47,375 | $1,496 | | Net cash provided by financing activities | $583 | $44,293 | | Net change in cash, cash equivalents and restricted cash | $(30,258) | $(15,675) | | Cash, cash equivalents and restricted cash, end of period | $41,839 | $54,133 | - The increase in net cash used in operating activities was primarily due to an increase in net loss[33] - Net cash provided by investing activities increased significantly due to a decrease in purchases of marketable securities[33] Notes to Unaudited Condensed Consolidated Financial Statements These notes provide detailed disclosures supporting the unaudited condensed consolidated financial statements, covering accounting policies, liquidity, collaboration agreements, and other financial specifics Nature of the Business and Basis of Presentation Tango Therapeutics is a precision oncology company, and its financial statements are prepared in conformity with U.S. GAAP, reflecting consolidated operations - Tango Therapeutics, Inc. is a precision oncology company focused on novel drug discovery and development[36] - The financial statements are prepared in conformity with U.S. GAAP and reflect the consolidated operations of Tango and its subsidiaries[38] Liquidity and Capital Resources (Notes) Tango Therapeutics expects existing cash and marketable securities of $180.8 million to fund operations into Q1 2027, but anticipates future losses requiring additional funding - Existing cash, cash equivalents, and marketable securities ($180.8 million as of June 30, 2025) are expected to fund operations into the first quarter of 2027[40] - The company expects to incur significant operating losses and negative cash flows for the foreseeable future and will require additional funding[41] Summary of Significant Accounting Policies No changes were made to significant accounting policies from the 2024 Annual Report, with estimates and judgments applied to revenue and R&D expenses - No changes from the significant accounting policies disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[42] - Significant estimates and assumptions are made for collaboration revenue and research and development expenses[43] Recently Adopted Accounting Pronouncements The company is evaluating the impact of new accounting pronouncements, ASU 2023-09 and ASU 2024-03, on its financial statements and disclosures - ASU 2023-09, 'Income Taxes (Topic 740): Improvements to Income Tax Disclosures,' is effective for annual periods beginning after December 15, 2024[46] - ASU 2024-03, 'Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses,' is effective for fiscal years beginning after December 15, 2026[47] - The company is evaluating the potential impact of these new standards on its financial statements[46][47] Collaboration Agreements Tango Therapeutics has a collaboration with Gilead Sciences, recognizing $3.2 million and $8.6 million in collaboration revenue for Q2 and H1 2025, respectively - The Amended Research Collaboration and License Agreement with Gilead Sciences, Inc. (Gilead) allows Gilead to license up to 15 programs[49] - Tango is eligible to receive up to $410.0 million per program in license, research option-extension, and clinical, regulatory, and commercial milestones, plus royalties on future sales[50] Collaboration and License Revenue (in thousands) | Period | Collaboration Revenue | License Revenue | | :----------------------------- | :-------------------- | :-------------- | | Three Months Ended June 30, 2025 | $3,181 | $0 | | Three Months Ended June 30, 2024 | $7,775 | $12,100 | | Six Months Ended June 30, 2025 | $8,573 | $0 | | Six Months Ended June 30, 2024 | $14,246 | $12,100 | Fair Value Measurements Financial assets measured at fair value totaled $147.9 million as of June 30, 2025, primarily marketable debt securities and money market funds Fair Market Value Measurements as of June 30, 2025 (in thousands) | Item | Level 1 | Level 2 | Level 3 | Total | | :---------------------- | :------ | :------ | :------ | :------ | | Money market funds | $3,953 | $0 | $0 | $3,953 | | U.S. Treasury bills | $0 | $2,485 | $0 | $2,485 | | Marketable debt securities: U.S. Treasury bills | $0 | $135,506 | $0 | $135,506 | | U.S. government agency bonds | $0 | $6,007 | $0 | $6,007 | | Total assets | $3,953 | $143,998 | $0 | $147,951 | - No transfers occurred between fair value levels during the six months ended June 30, 2025[57] Marketable Securities Marketable debt securities, classified as available-for-sale, totaled $141.5 million at fair value as of June 30, 2025, held at an unrealized loss Marketable Debt Securities (in thousands) | Item | Fair Value (June 30, 2025) | Fair Value (Dec 31, 2024) | | :-------------------------- | :------------------------- | :------------------------ | | U.S. Treasury bills | $135,506 | $176,374 | | U.S. government agency bonds | $6,007 | $12,013 | | Total marketable debt securities | $141,513 | $188,387 | - As of June 30, 2025, marketable securities had a gross unrealized loss of $21 thousand[59] - The company does not intend to sell marketable securities prior to the recovery of their value and has not recorded any impairments[61] Supplemental Balance Sheet Information Property and equipment, net, decreased to $7.8 million, while accrued expenses and other current liabilities decreased to $11.5 million Property and Equipment, Net (in thousands) | Item | June 30, 2025 | December 31, 2024 | | :---------------------- | :------------ | :---------------- | | Property and equipment, net | $7,786 | $8,102 | Accrued Expenses and Other Current Liabilities (in thousands) | Item | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Payroll and employee-related costs | $5,595 | $8,951 | | Research and development costs | $3,918 | $5,811 | | Total accrued expenses and other current liabilities | $11,510 | $16,497 | - Restricted cash balance was $2.6 million as of June 30, 2025, related to a facility lease security deposit[65] Commitments and Contingencies The company has license agreements, including one with Sesame Therapeutics, and a clinical trial collaboration with Revolution Medicines, with no material legal proceedings - In June 2024, the company granted Sesame Therapeutics, Inc. a non-exclusive license for certain know-how, receiving a $0.1 million upfront payment and eligible for up to $25.9 million in future milestones and low single-digit royalties[66][67] - The USP1 program (TNG348) under the Medivir Agreement was discontinued in May 2024 due to liver toxicity, with no ongoing material obligations expected[73] - A Clinical Trial Collaboration and Supply Agreement was entered with Revolution Medicines, Inc. in November 2024 for combination trials involving TNG462 and RAS(ON) inhibitors[74] Stockholders' Equity Stockholders approved an increase in authorized common stock to 400,000,000 shares, with no preferred stock issued or outstanding - Stockholders approved an increase in authorized common stock from 200,000,000 to 400,000,000 shares on June 5, 2025[78] - 10,000,000 shares of preferred stock are authorized, but no shares are issued and outstanding[79] Stock-Based Compensation Stock-based compensation expense was $6.6 million for Q2 2025 and $13.8 million for H1 2025, with shares available under incentive plans Stock-Based Compensation Expense (in thousands) | Expense Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Research and development | $3,549 | $4,162 | $7,535 | $7,968 | | General and administrative | $3,021 | $3,376 | $6,290 | $6,289 | | Total | $6,570 | $7,538 | $13,825 | $14,257 | - As of June 30, 2025, 7,480,243 shares were available for future issuance under the 2021 Plan, and 2,041,015 shares under the Inducement Plan[83][84] - Total unrecognized compensation expense for stock options was $36.3 million (over 2.6 years) and for RSUs was $6.7 million (over 2.0 years) as of June 30, 2025[86][88] Net Loss Per Share Basic and diluted net loss per common share was $(0.35) for Q2 2025 and $(0.71) for H1 2025, with anti-dilutive securities excluded Net Loss Per Common Share (Basic and Diluted) | Period | Net Loss Per Common Share | | :----------------------------- | :------------------------ | | Three Months Ended June 30, 2025 | $(0.35) | | Three Months Ended June 30, 2024 | $(0.24) | | Six Months Ended June 30, 2025 | $(0.71) | | Six Months Ended June 30, 2024 | $(0.58) | - Potential dilutive securities (stock options and unvested restricted common stock) were excluded from diluted net loss per share calculation due to their anti-dilutive effect[91] Income Taxes The effective income tax rate was approximately -0.1% due to a valuation allowance, and new tax legislation (OBBB) is being assessed - Effective income tax rate was approximately -0.1% for both the three and six months ended June 30, 2025 and 2024[92] - The low effective tax rate is primarily due to a valuation allowance maintained against deferred tax assets[93] - The company is evaluating the impact of the new U.S. tax legislation, the One Big Beautiful Bill (OBBB), signed on July 4, 2025[94] Segment Information Tango Therapeutics operates as a single oncology segment, reporting a net loss of $38.9 million for Q2 2025, with varying program expenses - The company operates in one operating segment: Oncology, managed on a consolidated basis[95] Oncology Segment Revenue and Net Loss (in thousands) | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $3,181 | $19,875 | $8,573 | $26,346 | | Segment net loss | $(38,853) | $(25,551) | $(78,729) | $(63,465) | - Direct program expenses for TNG462, TNG456, and TNG961 increased, while TNG260, TNG908, and TNG348 expenses decreased due to program discontinuations (TNG908, TNG348) or lower clinical trial costs (TNG260)[97][98][99] Subsequent event The Gilead collaboration research term was truncated to five years, with no financial penalty and $53.8 million deferred revenue to be recognized in Q3 2025 - On August 4, 2025, the research term of the collaboration and license agreement with Gilead was truncated from seven to five years[101] - There is no financial penalty to Tango, and all agreements for future milestones and royalties remain in effect[101] - The remaining unrecognized deferred revenue balance of $53.8 million as of June 30, 2025, will be recognized as revenue in the third quarter of 2025[101] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on Tango Therapeutics' financial condition, strategic focus, clinical pipeline, and detailed analysis of financial performance Overview Tango Therapeutics is a precision oncology company developing novel drugs for genetically altered cancers, with key programs including TNG462, TNG456, TNG260, and TNG961 - Tango Therapeutics focuses on discovering targeted therapies in oncology by addressing specific genetic alterations that drive cancer, including tumor suppressor gene loss and immune evasion[104] - Key product candidates include TNG462 (MTA-cooperative PRMT5 inhibitor for non-CNS cancers), TNG456 (brain-penetrant PRMT5 inhibitor for CNS cancers like GBM), TNG260 (first-in-class CoREST inhibitor for STK11-mut/RAS WT lung cancer), and TNG961 (development candidate targeting HBS1L in FOCAD-deleted solid tumors)[105][108][109][110] - Recent clinical updates include positive early data for TNG462 (Phase 1/2 ongoing, data update H2 2025), initiation of TNG462 combination trials in June 2025, first patient treated with TNG456 in May 2025, and established clinical proof-of-mechanism for TNG260 (data expected H2 2025)[106][107][108][109] Financial Overview Tango Therapeutics has raised $869.1 million since inception, with $180.8 million in cash as of June 30, 2025, and expects continued net losses - Since inception, the company has raised an aggregate of $869.1 million from preferred shares, business combination, Gilead collaboration, and equity offerings[112] - As of June 30, 2025, cash, cash equivalents, and marketable securities were $180.8 million, expected to fund operations into the first quarter of 2027[113] Net Losses (in millions) | Period | Net Loss | | :------------------- | :------- | | Six months ended June 30, 2025 | $78.7 | | Six months ended June 30, 2024 | $63.5 | At-the-Market Stock Offering The company has a sales agreement with Jefferies LLC to sell up to $100.0 million of common stock, having sold 4,001,200 shares for $43.0 million to date - The company has a sales agreement with Jefferies LLC to sell up to $100.0 million of common stock through at-the-market offerings[116] - To date, 4,001,200 shares have been sold, generating gross proceeds of $43.0 million[116] Revenue No product sales revenue has been recognized to date, with future revenue contingent on successful clinical development, regulatory approval, or licensing - No revenue from product sales has been recognized to date, and none is expected for several years[117] - Future revenue depends on successful clinical development, regulatory approval, or third-party license agreements[117] Collaboration Agreements with Gilead Sciences The Gilead collaboration provided $175.0 million upfront and $24.0 million in research extension fees, with $145.2 million recognized as collaboration revenue by June 30, 2025 - The collaboration with Gilead Sciences includes upfront payments of $175.0 million and $24.0 million in research extension fees[118][119] - As of June 30, 2025, $145.2 million has been recognized as collaboration revenue from the Gilead agreements[120] Collaboration and License Revenue (in millions) | Period | Collaboration Revenue | License Revenue | | :----------------------------- | :-------------------- | :-------------- | | Three Months Ended June 30, 2025 | $3.2 | $0 | | Three Months Ended June 30, 2024 | $7.8 | $12.1 | | Six Months Ended June 30, 2025 | $8.6 | $0 | | Six Months Ended June 30, 2024 | $14.2 | $12.1 | Operating Expenses Operating expenses consist of R&D and G&A costs, with R&D decreasing due to program discontinuations and G&A increasing due to facilities and personnel Research and Development Expenses R&D expenses decreased to $32.8 million for Q2 2025 and $69.2 million for H1 2025, primarily due to program discontinuations, but are expected to increase Research and Development Expenses (in thousands) | Program/Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | TNG462 direct program expenses | $5,577 | $3,957 | $11,038 | $9,043 | | TNG456 direct program expenses | $1,646 | $0 | $2,970 | $0 | | TNG260 direct program expenses | $1,809 | $3,763 | $3,539 | $5,999 | | TNG961 direct program expenses | $1,572 | $0 | $3,793 | $0 | | TNG908 direct program expenses | $1,235 | $3,260 | $2,947 | $7,518 | | TNG348 direct program expenses | $0 | $1,641 | $0 | $4,941 | | Discovery direct program expenses | $2,709 | $7,514 | $7,388 | $13,025 | | Total research and development expenses | $32,807 | $38,654 | $69,249 | $76,719 | - The decrease in R&D expenses was primarily due to the discontinuation of TNG908 and TNG348 clinical programs and lower TNG260 clinical trial costs and discovery program expenses[141][149] - R&D expenses are expected to increase substantially in the future as product candidates advance through preclinical and clinical development[129] General and Administrative Expenses G&A expenses increased to $11.3 million for Q2 2025 and $22.8 million for H1 2025, driven by higher facilities, IT, and personnel-related costs General and Administrative Expenses (in thousands) | Period | G&A Expenses | | :----------------------------- | :----------- | | Three Months Ended June 30, 2025 | $11,341 | | Three Months Ended June 30, 2024 | $10,773 | | Six Months Ended June 30, 2025 | $22,821 | | Six Months Ended June 30, 2024 | $21,434 | - The increase in G&A expenses was primarily due to increases in facilities and IT-related costs, and personnel-related costs including share-based compensation and additional headcount[142][150] Other Income, Net Interest income decreased to $1.2 million for Q2 2025 and $2.9 million for H1 2025 due to a lower marketable securities balance Interest Income (in thousands) | Period | Interest Income | | :----------------------------- | :-------------- | | Three Months Ended June 30, 2025 | $1,239 | | Three Months Ended June 30, 2024 | $2,071 | | Six Months Ended June 30, 2025 | $2,853 | | Six Months Ended June 30, 2024 | $4,268 | - Interest income decreased due to a decrease in the marketable securities balance[143][151] - Other income, net, decreased due to lower accretion from investments purchased at a discount[144][152] Provision for Income Taxes The provision for income taxes was insignificant, less than $0.1 million, for both the three and six months ended June 30, 2025 and 2024 - Provision for income taxes was less than $0.1 million for both the three and six months ended June 30, 2025 and 2024[145][153] Results of Operations This section details the financial results for Q2 and H1 2025 versus 2024, highlighting changes in revenue, operating expenses, and net loss Comparison of the three months ended June 30, 2025 and 2024 Total revenue decreased by $16.7 million, R&D expenses decreased by $5.9 million, and net loss widened by $13.3 million for Q2 2025 Results of Operations: Q2 2025 vs Q2 2024 (in thousands) | Item | 2025 | 2024 | Change | | :------------------------ | :----- | :----- | :------- | | Total revenue | $3,181 | $19,875 | $(16,694) | | Research and development | $32,807 | $38,654 | $(5,847) | | General and administrative | $11,341 | $10,773 | $568 | | Net loss | $(38,853) | $(25,551) | $(13,302) | | Interest income | $1,239 | $2,071 | $(832) | | Other income, net | $910 | $1,995 | $(1,085) | - Collaboration revenue decreased by $4.6 million due to lower research costs incurred under the Gilead collaboration[139] - License revenue was $0 in Q2 2025, compared to $12.1 million in Q2 2024 from a program licensed to Gilead[140] Comparison of the six months ended June 30, 2025 and 2024 Total revenue decreased by $17.8 million, R&D expenses decreased by $7.5 million, and net loss widened by $15.3 million for H1 2025 Results of Operations: H1 2025 vs H1 2024 (in thousands) | Item | 2025 | 2024 | Change | | :------------------------ | :----- | :----- | :------- | | Total revenue | $8,573 | $26,346 | $(17,773) | | Research and development | $69,249 | $76,719 | $(7,470) | | General and administrative | $22,821 | $21,434 | $1,387 | | Net loss | $(78,729) | $(63,465) | $(15,264) | | Interest income | $2,853 | $4,268 | $(1,415) | | Other income, net | $1,984 | $4,179 | $(2,195) | - Collaboration revenue decreased by $5.7 million due to lower research costs incurred under the Gilead collaboration[147] - License revenue was $0 in H1 2025, compared to $12.1 million in H1 2024 from a program licensed to Gilead[148] Liquidity and Capital Resources Tango Therapeutics has $180.8 million in cash as of June 30, 2025, expected to fund operations into Q1 2027, with increased cash used in operating activities Sources of Liquidity Funding sources include equity financings and the Gilead collaboration, totaling $869.1 million since inception, with $180.8 million in cash as of June 30, 2025 - Funding sources include equity financings and the Gilead collaboration, totaling $869.1 million since inception[154] - As of June 30, 2025, cash, cash equivalents, and marketable securities totaled $180.8 million[154] Funding Requirements Existing cash and marketable securities are expected to fund operations into Q1 2027, but additional capital may be needed sooner - Existing cash, cash equivalents, and marketable securities ($180.8 million) are expected to fund operations into the first quarter of 2027[155] - The estimate is based on assumptions that may prove wrong, potentially requiring capital sooner than expected[155] Cash Flows Net cash used in operating activities increased to $78.2 million for H1 2025, while investing activities provided $47.4 million, and financing activities provided $0.6 million Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change | | :-------------------------------- | :----------------------------- | :----------------------------- | :------- | | Net cash used in operating activities | $(78,216) | $(61,464) | $(16,752) | | Net cash provided by investing activities | $47,375 | $1,496 | $45,879 | | Net cash provided by financing activities | $583 | $44,293 | $(43,710) | - Increase in net cash used in operating activities was primarily due to an increase in net loss[157] - Decrease in net cash provided by financing activities was due to the absence of proceeds from the at-the-market stock offering program in 2025, which was present in 2024[159] Contractual Obligations and Commitments Contractual obligations primarily consist of $47.7 million in operating lease commitments, with R&D purchase obligations generally cancellable Contractual Obligations at June 30, 2025 (in thousands) | Obligation | Total | Less than 1 Year | 1 – 3 Years | 3 – 5 Years | More than 5 Years | | :------------------------ | :------ | :--------------- | :---------- | :---------- | :---------------- | | Operating lease commitments | $47,651 | $5,696 | $11,901 | $12,626 | $17,428 | - Purchase obligations for preclinical studies, clinical operations, manufacturing, and R&D supplies are generally cancellable and not included in the table[161] - Future milestone and royalty payments under license agreements are contingent upon future events and are not included as their timing or likelihood cannot be estimated[162] Critical Accounting Policies and Significant Judgments and Estimates Financial statement preparation requires significant judgments and estimates, particularly for revenue recognition and R&D expense accruals, with ongoing evaluation Revenue Recognition Revenue from collaboration agreements is recognized under ASC Topic 606, requiring significant judgment in estimating standalone selling prices and timing - Revenue is recognized under ASC Topic 606, following a five-step framework[166] - Significant judgment is required to determine standalone selling prices for performance obligations, considering factors like forecasted revenues, development timelines, and probabilities of success[170] - Milestones tied to regulatory approval are considered constrained and excluded from the transaction price until approval is received[168] Accrued Research and Development Expenses Accrued R&D expenses are estimated based on service progress by vendors, considering completion status, invoicing, and contractual terms - Accrued R&D expenses are estimated based on the level of service performed and costs incurred when invoices are not yet received[175] - Estimates consider progress towards completion of R&D activities, invoicing, vendor communications, and contract terms[176] Recently Adopted Accounting Pronouncements Recently issued and adopted accounting pronouncements that may impact the company's financial statements are described in Note 2 - Recently issued and adopted accounting pronouncements are described in Note 2 of the unaudited condensed consolidated financial statements[178] Item 3. Quantitative and Qualitative Disclosures About Market Risk There were no material changes to the company's market risks from those described in its Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to market risks from those described in the Annual Report on Form 10-K for the year ended December 31, 2024[179] Item 4. Controls and Procedures This section details the evaluation of the company's disclosure controls and procedures and reports on any changes in internal control over financial reporting Evaluation of Disclosure Controls and Procedures Management concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2025 - Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective at the reasonable assurance level as of June 30, 2025[180] Changes in Internal Control Over Financial Reporting No material changes in internal control over financial reporting occurred during the quarter ended June 30, 2025 - No material changes in internal control over financial reporting occurred during the quarter ended June 30, 2025[181] PART II. OTHER INFORMATION This part includes information on legal proceedings, risk factors, equity sales, defaults, other information, and exhibits Item 1. Legal Proceedings Tango Therapeutics is not currently a party to any litigation or legal proceedings that management believes are probable to have a material adverse effect on its business - The company is not currently a party to any material legal proceedings[184] Item 1A. Risk Factors This section updates risk factors, emphasizing new or materially changed risks related to government funding, global economic conditions, healthcare reforms, and tax legislation Inadequate funding for government agencies Inadequate funding or disruptions at government agencies could delay product development and regulatory approvals, with new administration policies adding uncertainty - Inadequate funding or disruptions at government agencies (FDA, SEC) could prevent timely product development, commercialization, and regulatory approvals[187][188] - A prolonged government shutdown or significant policy changes could materially impact the FDA's ability to review regulatory submissions[191] - The change in the U.S. presidential administration in 2025 creates uncertainty regarding modifications to FDA and other regulatory agency requirements and policies[192] Unfavorable global economic conditions Unfavorable global economic conditions, including inflation, interest rates, and geopolitical issues, could adversely affect business and supply chains - Increased inflation and interest rates could weaken demand for product candidates and hinder the ability to raise additional capital[194][196] - Geopolitical issues, including tariffs, sanctions, and global conflicts (e.g., Russia-Ukraine, Middle East), could disrupt business and supply chains[196][197] Healthcare legislative reform measures Healthcare reforms like the IRA and OBBB could significantly impact drug pricing, reimbursement, and market access, potentially forcing lower product prices - The Inflation Reduction Act of 2022 (IRA) includes provisions for small molecule drug price setting, potentially forcing lower prices for CMS programs earlier than typical generic competition[200][201] - The One Big Beautiful Bill Act of 2025 (OBBB) eliminated the restriction on orphan drug exemptions from Medicare drug price negotiation, making all orphan drugs exempt regardless of multiple designations or indications[202] - Executive Orders (e.g., 14273, 14297) direct the federal government to take measures to reduce drug prices, including establishing most-favored-nation price targets and examining direct-to-patient sales[202] Comprehensive tax reform legislation Changes in tax laws, such as the OBBB, could materially affect the company's cash and financial position, particularly regarding R&D expense amortization - The One Big Beautiful Bill (OBBB), signed on July 4, 2025, made significant changes to U.S. federal tax law[207] - For taxable years beginning after December 31, 2024, U.S.-based R&D expenses may be immediately deducted or capitalized and amortized, with retroactive deduction options for prior years[207] - Changes in tax laws could increase compliance, operating, and product costs, and affect the company's effective tax rate[207] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds There were no unregistered sales of equity securities or use of proceeds to report during the period - No unregistered sales of equity securities or use of proceeds to report[209] Item 3. Defaults Upon Senior Securities There were no defaults upon senior securities to report during the period - No defaults upon senior securities to report[210] Item 4. Mine Safety Disclosures This item is not applicable to Tango Therapeutics, Inc - Mine Safety Disclosures are not applicable to the registrant[211] Item 5. Other Information This section discloses an amendment to the Gilead Agreement and confirms no insider trading arrangements were adopted or terminated during the quarter Amendment to Gilead Agreement The Gilead collaboration research term was truncated to five years, with no financial penalty and $53.8 million deferred revenue to be recognized in Q3 2025 - On August 4, 2025, the research term of the Gilead Agreement was truncated from seven to five years, concluding the research portion[212] - No financial penalty to Tango, all ongoing work on licensed programs continues, and future milestones and royalties remain in effect[212] - The remaining $53.8 million deferred revenue as of June 30, 2025, will be recognized in the third quarter of 2025[212] Insider Trading Arrangements No insider trading arrangements were adopted, modified, or terminated by directors or officers during the quarter ended June 30, 2025 - No insider trading arrangements (Rule 10b5-1 or non-Rule 10b5-1) were adopted, modified, or terminated by directors or officers during the quarter ended June 30, 2025[213] Item 6. Exhibits This section lists all exhibits filed with the Quarterly Report on Form 10-Q, including corporate governance documents, compensation policies, and certifications - Exhibits include corporate governance documents (Certificate of Incorporation, Bylaws), Non-Employee Director Compensation Policy, Amendment to the Gilead Agreement, and various certifications (e.g., 31.1, 31.2, 32.1, 32.2)[214][215] - XBRL Instance Document and Taxonomy Extension Schema are also included[214][215] Signatures The Quarterly Report on Form 10-Q was duly signed by the President and CEO, and CFO of Tango Therapeutics, Inc. on August 5, 2025 - The report was signed by Barbara Weber, MD, President and Chief Executive Officer, and Daniella Beckman, Chief Financial Officer[219] - The report was dated August 5, 2025[219]