Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) For the transition period from _________ to _________ Commission File No. 001-40111 __________________________ SABLE OFFSHORE CORP. (Exact name of registrant as specified in its charter) __________________________ Delaware 85-3514078 x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (State or other jurisdiction of incorporation or organization) (I.R.S. Employ ...

[Special Note Regarding Forward-Looking Statements](index=2&type=section&id=SPECIAL%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section highlights forward-looking statements, subject to substantial risks and uncertainties - This report contains forward-looking statements involving substantial risks and uncertainties, identifiable by words like 'expect,' 'plan,' 'anticipate,' or 'potential'[5](index=5&type=chunk)[6](index=6&type=chunk) - Forward-looking statements cover anticipated use of cash, product candidate characteristics, preclinical/clinical trial timing and results, regulatory approvals, commercialization plans, market size estimates, manufacturing capabilities, expenses, competition, growth strategies, personnel, partnerships, regulatory requirements, intellectual property, and economic factors[7](index=7&type=chunk) - Actual results may differ materially due to known and unknown risks, uncertainties, and assumptions, particularly those described in the 'Risk Factors' section'[8](index=8&type=chunk) [Risk Factor Summary](index=4&type=section&id=RISK%20FACTOR%20SUMMARY) This summary outlines key risks impacting the company's business and financial prospects - The company's business operations are subject to numerous risks that could materially and adversely affect its business, financial condition, results of operations, and future growth prospects[14](index=14&type=chunk) - Key risk categories include business and industry, product candidate development, manufacturing, government regulation, intellectual property, reliance on third parties, employee matters and growth management, common stock and public company status, and general risk factors[14](index=14&type=chunk)[15](index=15&type=chunk)[17](index=17&type=chunk) [PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the company's unaudited financial statements and management's financial analysis [Item 1. Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the company's unaudited consolidated financial statements and accompanying notes [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the company's condensed consolidated balance sheets, showing assets, liabilities, and equity | Category | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :--------------------------- | :----------------------------- | | Cash and cash equivalents | $169,394 | $178,689 | | Marketable securities | $48,651 | $111,421 | | Total current assets | $221,130 | $292,722 | | Total assets | $298,561 | $371,118 | | Total current liabilities | $31,322 | $35,956 | | Total liabilities | $121,847 | $130,148 | | Total stockholders' equity | $176,714 | $240,970 | | Accumulated deficit | $(446,175) | $(375,096) | - Total assets decreased by **$72.557 million** from December 31, 2024, to June 30, 2025, primarily due to a reduction in marketable securities and cash and cash equivalents[22](index=22&type=chunk) - Total stockholders' equity decreased by **$64.256 million**, driven by an increased accumulated deficit[22](index=22&type=chunk) [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section presents the company's condensed consolidated statements of operations for recent interim periods | Category | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :-------------------------------------- | :-------------------------------------- | :------------------------------------ | :------------------------------------ | | Collaboration and license revenue | $3,076 | $536 | $5,247 | $1,102 | | Research and development | $32,634 | $26,877 | $62,422 | $51,734 | | General and administrative | $9,095 | $7,773 | $17,728 | $14,855 | | Total operating expenses | $41,729 | $34,650 | $80,150 | $66,589 | | Loss from operations | $(38,653) | $(34,114) | $(74,903) | $(65,487) | | Net loss | $(36,952) | $(31,661) | $(71,079) | $(61,803) | | Net loss per share, basic and diluted | $(0.28) | $(0.28) | $(0.55) | $(0.59) | - Collaboration and license revenue increased significantly for both the three-month period (from **$536 thousand** to **$3.076 million**) and six-month period (from **$1.102 million** to **$5.247 million**) year-over-year[25](index=25&type=chunk) - Net loss increased to **($36.952) million** for the three months ended June 30, 2025, from **($31.661) million** in the prior year, and to **($71.079) million** for the six months ended June 30, 2025, from **($61.803) million** in the prior year, primarily due to increased operating expenses[25](index=25&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) This section presents the company's condensed consolidated statements of stockholders' equity | Category | Balances at March 31, 2024 (in thousands) | Balances at June 30, 2024 (in thousands) | Balances at March 31, 2025 (in thousands) | Balances at June 30, 2025 (in thousands) | | :-------------------------------- | :-------------------------------------- | :------------------------------------- | :-------------------------------------- | :------------------------------------- | | Common Stock Shares | 43,628,149 | 48,656,158 | 52,314,039 | 52,471,405 | | Additional Paid-In Capital | $400,701 | $564,615 | $619,423 | $622,887 | | Accumulated Deficit | $(277,739) | $(309,400) | $(409,223) | $(446,175) | | Total Stockholders' Equity | $122,967 | $255,221 | $210,202 | $176,714 | - Total stockholders' equity decreased from **$240.970 million** at January 1, 2025, to **$176.714 million** at June 30, 2025, primarily due to a net loss of **$71.079 million**[28](index=28&type=chunk) - Additional paid-in capital increased by **$6.878 million** during the six months ended June 30, 2025, mainly from stock-based compensation expense and ESPP plan issuance[28](index=28&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section presents the company's condensed consolidated statements of cash flows | Category | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :------------------------------------------ | :------------------------------------ | :------------------------------------ | | Net cash used in operating activities | $(70,853) | $(55,492) | | Net cash provided by investing activities | $61,967 | $2,447 | | Net cash provided by (used in) financing activities | $(409) | $161,845 | | Net increase (decrease) in cash, cash equivalents and restricted cash | $(9,295) | $108,800 | | Cash, cash equivalents, and restricted cash - end of period | $174,425 | $247,190 | - Net cash used in operating activities increased to **$70.853 million** for the six months ended June 30, 2025, from **$55.492 million** in the prior year[31](index=31&type=chunk) - Net cash provided by investing activities significantly increased to **$61.967 million** in 2025 from **$2.447 million** in 2024, primarily due to marketable securities maturities[31](index=31&type=chunk) - Net cash from financing activities shifted from providing **$161.845 million** in 2024 to using **$409 thousand** in 2025, reflecting reduced equity offerings[31](index=31&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed notes to the unaudited condensed consolidated financial statements [1. Nature of Business and Basis of Presentation](index=11&type=section&id=1.%20Nature%20of%20Business%20and%20Basis%20of%20Presentation) This note describes TScan Therapeutics' business as a clinical-stage biotech and its accounting basis - TScan Therapeutics, Inc. is a clinical-stage biotechnology company developing TCR-T therapy product candidates for the treatment of cancer[34](index=34&type=chunk) - The company has incurred recurring net losses, including **$71.1 million** for the six months ended June 30, 2025, and has an accumulated deficit of **$446.2 million**[37](index=37&type=chunk) - Existing cash, cash equivalents, and marketable securities are expected to fund operations for at least the next 12 months from the date of financial statements issuance[37](index=37&type=chunk) - The company qualifies as an "emerging growth company" and has elected to use the extended transition period for complying with new or revised accounting standards[38](index=38&type=chunk) [2. Summary of Significant Accounting Policies](index=12&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This note summarizes the company's accounting policies and evaluation of new pronouncements - The accounting policies for interim financial reporting are consistent with those in the Company's Annual Report on Form 10-K for the year ended December 31, 2024[40](index=40&type=chunk) - The company is evaluating the impact of ASU No. 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures," effective for annual periods beginning after December 15, 2024[41](index=41&type=chunk) - The company is evaluating the potential impact of ASU No. 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures," effective for annual periods beginning after December 15, 2026[43](index=43&type=chunk) [3. Fair Value Measurements](index=12&type=section&id=3.%20Fair%20Value%20Measurements) This note details the fair value measurements of the company's financial assets, primarily cash equivalents and marketable securities | Asset Category | June 30, 2025 (Level 1) | December 31, 2024 (Level 1) | | :----------------------------- | :---------------------- | :-------------------------- | | Cash equivalents – money market funds | $162,200 | $169,744 | | Cash equivalents - government securities | $2,993 | - | | Marketable securities – government securities | $48,651 | $111,421 | | **Total financial assets** | **$213,844** | **$281,165** | - Money market funds and government securities are valued based on quoted market prices, representing a Level 1 measurement within the fair value hierarchy[44](index=44&type=chunk) [4. Accrued Expenses and Other Current Liabilities](index=13&type=section&id=4.%20Accrued%20Expenses%20and%20Other%20Current%20Liabilities) This note explains the composition and changes in accrued expenses and other current liabilities | Category | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :------------------------------------ | :--------------------------- | :----------------------------- | | Accrued research and development | $7,054 | $6,735 | | Accrued employee compensation and benefits | $3,662 | $6,845 | | Accrued consulting and professional services | $1,534 | $1,473 | | Accrued legal services and license fee | $357 | $281 | | Other | $190 | $76 | | **Total accrued expenses and other current liabilities** | **$12,797** | **$15,410** | - Accrued employee compensation and benefits decreased by **$3.183 million** from December 31, 2024, to June 30, 2025[46](index=46&type=chunk) [5. Stockholders' Equity](index=13&type=section&id=5.%20Stockholders%27%20Equity) This note details the company's equity offerings and changes in stockholders' equity - On May 16, 2023, the company entered into an "at-the-market" (ATM) sales agreement for up to **$75.0 million** of voting common stock, with no sales to date[47](index=47&type=chunk) - On April 24, 2024, an underwritten public offering generated approximately **$161.4 million** in aggregate net proceeds from common stock and pre-funded warrants[49](index=49&type=chunk) - On December 27, 2024, a registered direct offering of pre-funded warrants generated approximately **$30.0 million** in gross proceeds[50](index=50&type=chunk) - As of June 30, 2025, no Pre-Funded Warrants have been exercised[51](index=51&type=chunk) [6. Collaboration and License Agreements](index=13&type=section&id=6.%20Collaboration%20and%20License%20Agreements) This note describes the company's collaboration and license agreements, including the Amgen agreement - On May 8, 2023, TScan Therapeutics entered a Collaboration Agreement with Amgen Inc. to identify antigens recognized by T cells in patients with Crohn's disease[52](index=52&type=chunk) - The agreement included an upfront payment of **$30.0 million**, collected in July 2023, and eligibility for over **$500.0 million** in success-based milestone payments and tiered single-digit royalties[53](index=53&type=chunk) - Revenue associated with the Amgen Agreement is recognized over the estimated three-year research term using an input method based on costs incurred[56](index=56&type=chunk) | Period | 2025 (in thousands) | 2024 (in thousands) | | :------------------- | :------------------ | :------------------ | | Three Months Ended June 30, | $3,076 | $536 | | Six Months Ended June 30, | $5,247 | $1,102 | [7. Commitments and Contingencies](index=14&type=section&id=7.%20Commitments%20and%20Contingencies) This note outlines the company's lease commitments, license agreements, and royalty obligations - The company leases office space under non-cancelable operating lease agreements, with no material changes during the period[59](index=59&type=chunk) - TScan holds a worldwide exclusive license to its foundational TargetScan technology from Brigham and Women's Hospital, which includes fees for development milestones and various royalties on future product sales[60](index=60&type=chunk) - A royalty agreement with one of its founders mandates a **1%** royalty of net sales for products covered by specific patents, payable in perpetuity for a defined period[61](index=61&type=chunk) [8. Loan and Security Agreements](index=15&type=section&id=8.%20Loan%20and%20Security%20Agreements) This note details the company's debt agreements, including the termination of K2HV and new SVB loan - On December 20, 2024, the K2HV Loan Agreement was terminated, with **$15.0 million** in remaining principal, a **$1.8 million** exit fee, and a **$0.3 million** prepayment fee repaid[63](index=63&type=chunk) - A new Loan and Security Agreement with Silicon Valley Bank (SVB) was entered into on December 20, 2024, providing up to **$52.5 million**, with a first tranche of **$32.5 million** fully funded[65](index=65&type=chunk) - The SVB term loans mature on September 1, 2029, with monthly interest-only payments until September 30, 2027, contingent on achieving certain financial and clinical milestones[66](index=66&type=chunk) | Period | Interest Expense (in thousands) | | :------------------- | :------------------------------ | | Three Months Ended June 30, 2025 | $689 | | Three Months Ended June 30, 2024 | $952 | | Six Months Ended June 30, 2025 | $1,368 | | Six Months Ended June 30, 2024 | $1,911 | | Year | Future Principal Payments (in thousands) | | :--- | :------------------------------------- | | 2027 | $4,063 | | 2028 | $16,250 | | 2029 | $12,187 | | **Total principal payments** | **$32,500** | [9. Segment Reporting](index=16&type=section&id=9.%20Segment%20Reporting) This note states the company operates as a single segment focused on TCR-T therapy development - The company manages its operations as a single segment, focused on the development of TCR-T therapy product candidates for cancer[72](index=72&type=chunk) - The Chief Operating Decision Maker (CODM) assesses performance by reviewing GAAP net loss and significant expenses by function, along with annual budget variances[73](index=73&type=chunk) [10. Net Loss Per Share](index=17&type=section&id=10.%20Net%20Loss%20Per%20Share) This note provides the calculation of basic and diluted net loss per share | Period | Net Loss Per Share (basic and diluted) | | :------------------------------------------------ | :------------------------------------- | | Three Months Ended June 30, 2025 | $(0.28) | | Three Months Ended June 30, 2024 | $(0.28) | | Six Months Ended June 30, 2025 | $(0.55) | | Six Months Ended June 30, 2024 | $(0.59) | - **73,087,945** shares of common stock issuable upon exercise of Pre-Funded Warrants are included as outstanding common stock in the calculation of basic and diluted net loss per share[76](index=76&type=chunk) | Anti-Dilutive Potential Common Shares | June 30, 2025 | June 30, 2024 | | :------------------------------------ | :------------ | :------------ | | Options to purchase common stock | 17,917,902 | 12,804,957 | | Common stock issuable upon conversion of K2HV Loan Agreement | - | 6,269,592 | | Potential shares issuable under the ESPP | 109,984 | 69,617 | | **Total** | **18,027,886** | **19,144,166** | [11. Subsequent Event](index=17&type=section&id=11.%20Subsequent%20Event) This note describes the enactment of the OBBBA tax act and its potential impact on the company - The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, introducing significant changes to U.S. tax law, including mandatory research and development capitalization[78](index=78&type=chunk) - The company is currently analyzing the impact of these changes, awaiting regulations and guidance from the Department of Treasury[78](index=78&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=17&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's analysis of the company's financial condition, operations, and future outlook [Overview](index=18&type=section&id=Overview) This overview describes TScan Therapeutics' business, financial performance, and future funding needs - TScan Therapeutics is a clinical-stage biotechnology company focused on developing TCR-T therapies for hematologic and solid tumor malignancies, utilizing its ImmunoBank and proprietary platform technologies[81](index=81&type=chunk)[83](index=83&type=chunk) - The company's lead product candidate, TSC-101, is in a Phase 1 clinical study for AML, MDS, and ALL patients undergoing allogeneic HCT[82](index=82&type=chunk) - TScan reported net losses of **$71.1 million** for the six months ended June 30, 2025, and has an accumulated deficit of **$446.2 million** since inception[85](index=85&type=chunk) - The company expects to incur significant expenses and increasing operating losses, requiring substantial additional funding to advance its product candidates and build commercial capabilities[85](index=85&type=chunk)[87](index=87&type=chunk) [Results of Operations](index=19&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance, highlighting revenue and expense trends [Three months ended June 30, 2025 and 2024](index=20&type=section&id=Three%20months%20ended%20June%2030%2C%202025%20and%202024) This section compares financial results for the three months ended June 30, 2025 and 2024 | Category | June 30, 2025 (in thousands) | June 30, 2024 (in thousands) | Change (in thousands) | | :-------------------------------- | :--------------------------- | :--------------------------- | :-------------------- | | Collaboration and license revenue | $3,076 | $536 | $2,540 | | Research and development | $32,634 | $26,877 | $5,757 | | General and administrative | $9,095 | $7,773 | $1,322 | | Total operating expenses | $41,729 | $34,650 | $7,079 | | Loss from operations | $(38,653) | $(34,114) | $(4,539) | | Net loss | $(36,952) | $(31,661) | $(5,291) | - Research and development expenses increased by **$5.8 million**, primarily due to a **$3.8 million** increase in laboratory supplies, research materials, and studies, and a **$1.7 million** increase in facility-related expenses[92](index=92&type=chunk) - General and administrative expenses increased by **$1.3 million**, mainly due to a **$0.7 million** increase in personnel expenses from additional headcount[94](index=94&type=chunk) [Six months ended June 30, 2025 and 2024](index=21&type=section&id=Six%20months%20ended%20June%2030%2C%202025%20and%202024) This section compares financial results for the six months ended June 30, 2025 and 2024 | Category | June 30, 2025 (in thousands) | June 30, 2024 (in thousands) | Change (in thousands) | | :-------------------------------- | :--------------------------- | :--------------------------- | :-------------------- | | Collaboration and license revenue | $5,247 | $1,102 | $4,145 | | Research and development | $62,422 | $51,734 | $10,688 | | General and administrative | $17,728 | $14,855 | $2,873 | | Total operating expenses | $80,150 | $66,589 | $13,561 | | Loss from operations | $(74,903) | $(65,487) | $(9,416) | | Net loss | $(71,079) | $(61,803) | $(9,276) | - Research and development expenses increased by **$10.7 million**, primarily due to a **$6.0 million** increase in laboratory supplies, research materials, and studies, and a **$3.4 million** increase in facility-related expenses[99](index=99&type=chunk) - General and administrative expenses increased by **$2.9 million**, mainly due to a **$1.1 million** increase in personnel expenses and a **$0.3 million** increase in legal and professional fees[100](index=100&type=chunk) [Liquidity and Capital Resources](index=22&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's funding sources, capital requirements, and cash flow activities [Sources of Liquidity](index=22&type=section&id=Sources%20of%20Liquidity) This section details the company's sources of liquidity, including equity offerings and collaboration agreements - The company received a **$30.0 million** upfront payment in July 2023 from the Amgen Collaboration Agreement[102](index=102&type=chunk) - An underwritten public offering in April 2024 generated approximately **$161.4 million** in net proceeds from common stock and pre-funded warrants[105](index=105&type=chunk) - A registered direct offering in December 2024 generated approximately **$30.0 million** in gross proceeds from pre-funded warrants[107](index=107&type=chunk) - As of June 30, 2025, the company had **$218.0 million** in cash, cash equivalents, and marketable securities (excluding **$5.0 million** restricted cash)[108](index=108&type=chunk) [Funding requirements](index=23&type=section&id=Funding%20requirements) This section outlines the company's anticipated funding needs for R&D, clinical trials, and commercialization efforts - The company expects expenses to increase substantially for research and development, preclinical/clinical development, manufacturing, regulatory approvals, and commercialization[109](index=109&type=chunk) - Existing cash, cash equivalents, and marketable securities are believed to fund the current operating plan into the first quarter of 2027[110](index=110&type=chunk) - Substantial additional funding will be required through equity offerings, debt financings, collaborations, or other arrangements, which may dilute ownership or impose restrictions[111](index=111&type=chunk) - Failure to raise additional funds could lead to delays, reductions, or termination of research, product development, or commercialization efforts[111](index=111&type=chunk) [Cash Flows](index=25&type=section&id=Cash%20Flows) This section summarizes the company's cash flow activities from operations, investing, and financing | Category | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :------------------------------------------ | :------------------------------------ | :------------------------------------ | | Net cash used in operating activities | $(70,853) | $(55,492) | | Net cash provided by investing activities | $61,967 | $2,447 | | Net cash provided by (used in) financing activities | $(409) | $161,845 | | **Net increase (decrease) in cash, cash equivalents and restricted cash** | **$(9,295)** | **$108,800** | - Net cash used in operating activities for the six months ended June 30, 2025, was **$70.9 million**, primarily driven by the net loss of **$71.1 million**[118](index=118&type=chunk) - Net cash provided by investing activities was **$62.0 million** for the six months ended June 30, 2025, mainly from maturities of marketable securities[120](index=120&type=chunk) - Net cash used in financing activities was **$0.4 million** for the six months ended June 30, 2025, compared to **$161.8 million** provided in the prior year, reflecting reduced equity proceeds[121](index=121&type=chunk)[122](index=122&type=chunk) [Critical Accounting Policies and Estimates](index=25&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section confirms no material changes to the company's critical accounting policies and estimates - There have been no material changes to the company's critical accounting policies and estimates from those disclosed in its Annual Report on Form 10-K filed on March 5, 2025[125](index=125&type=chunk) [Emerging Growth Company and Smaller Reporting Company Status](index=26&type=section&id=Emerging%20Growth%20Company%20and%20Smaller%20Reporting%20Company%20Status) This section explains the company's status as an emerging growth and smaller reporting company - The company qualifies as an "emerging growth company" under the JOBS Act and has elected the extended transition period for complying with new or revised accounting standards[126](index=126&type=chunk) - The company is also a "smaller reporting company," which allows for reduced disclosure obligations, including auditor attestation requirements and executive compensation details[127](index=127&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=25&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, TScan Therapeutics is not required to provide market risk disclosures - As a "smaller reporting company," TScan Therapeutics is not required to provide quantitative and qualitative disclosures about market risk[128](index=128&type=chunk) [Item 4. Controls and Procedures](index=25&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details management's evaluation of disclosure controls and internal control over financial reporting [Evaluation of Disclosure Controls and Procedures](index=26&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) Management evaluated the effectiveness of disclosure controls and procedures, concluding they were effective - Management, under the supervision of the Principal Executive Officer and Principal Financial Officer, evaluated the effectiveness of disclosure controls and procedures as of June 30, 2025[129](index=129&type=chunk) - Based on the evaluation, disclosure controls and procedures were concluded to be effective at the reasonable assurance level[129](index=129&type=chunk) [Changes in Internal Control over Financial Reporting](index=27&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) No material changes in internal control over financial reporting occurred during the period - No change in internal control over financial reporting occurred during the period ended June 30, 2025, that materially affected, or is reasonably likely to materially affect, internal control over financial reporting[131](index=131&type=chunk) [PART II. OTHER INFORMATION](index=27&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity sales, and other miscellaneous information [Item 1. Legal Proceedings](index=27&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any material legal proceedings - The company is not currently a party to any material legal proceedings[133](index=133&type=chunk) - Involvement in legal proceedings, even in the ordinary course of business, can have an adverse impact due to defense and settlement costs, diversion of management resources, negative publicity, and reputational harm[133](index=133&type=chunk) [Item 1A. Risk Factors](index=28&type=section&id=Item%201A.%20Risk%20Factors) This section details significant risks that could materially affect the company's business and prospects [Risks Related to Our Business and Industry](index=29&type=section&id=Risks%20Related%20to%20Our%20Business%20and%20Industry) This section outlines risks related to the company's business model, operating history, and economic factors - The company has incurred significant net losses (**$71.1 million** for H1 2025, **$446.2 million** accumulated deficit) and expects increasing losses, requiring substantial additional funding[138](index=138&type=chunk)[149](index=149&type=chunk) - Business success depends on the proprietary platform for discovering and developing TCR-T therapy product candidates, which is a novel approach to cancer treatment[140](index=140&type=chunk)[172](index=172&type=chunk) - Limited operating history makes it difficult to assess future viability and successful transition from R&D to commercial activities[143](index=143&type=chunk)[144](index=144&type=chunk) - Global economic uncertainty, financial market volatility, and changes in federal policies (e.g., tax laws like OBBBA) could adversely affect financing access and business operations[156](index=156&type=chunk)[159](index=159&type=chunk)[160](index=160&type=chunk) [Risks Related to the Development of Our Product Candidates](index=35&type=section&id=Risks%20Related%20to%20the%20Development%20of%20Our%20Product%20Candidates) This section details risks associated with developing novel TCR-T therapy product candidates - Developing TCR-T therapy product candidates is a novel approach with significant challenges, including educating medical personnel, sourcing supplies, manufacturing efficiently, and managing adverse side effects[172](index=172&type=chunk)[173](index=173&type=chunk) - Preclinical studies and clinical trials may fail to adequately demonstrate safety, potency, and purity, leading to delays or prevention of regulatory approval and commercialization[184](index=184&type=chunk)[187](index=187&type=chunk) - Product candidates may cause undesirable side effects (e.g., GvHD, autoimmunity, immunogenicity) that could halt clinical development, require trial expansion, or limit commercial potential[207](index=207&type=chunk)[208](index=208&type=chunk)[210](index=210&type=chunk)[212](index=212&type=chunk) - Difficulties in enrolling patients in clinical trials, due to strict eligibility criteria, competition, or patient drop-out, could delay or adversely affect clinical development activities[218](index=218&type=chunk)[219](index=219&type=chunk)[220](index=220&type=chunk) - Product candidates may target healthy cells expressing target antigens, leading to serious and potentially fatal adverse effects, or exhibit cross-reactivity to unrelated peptides[215](index=215&type=chunk)[216](index=216&type=chunk) [Risks Related to Manufacturing](index=48&type=section&id=Risks%20Related%20to%20Manufacturing) This section outlines manufacturing risks, including complexity, third-party reliance, and scaling challenges - The manufacturing and administration process for product candidates is complex and highly regulated, susceptible to product loss or failure due to logistical issues, manufacturing interruptions, contamination, and equipment failure[258](index=258&type=chunk)[260](index=260&type=chunk) - The company relies on third parties for non-viral vectors and other components, and is reliant on single manufacturers/suppliers for critical raw materials and reagents, posing supply disruption risks[259](index=259&type=chunk)[427](index=427&type=chunk)[430](index=430&type=chunk) - Limited company experience in managing manufacturing facilities and scaling production could lead to cost-overruns, delays, and difficulties in maintaining quality control and regulatory compliance[264](index=264&type=chunk)[265](index=265&type=chunk) - Challenges in validating the manufacturing process due to the heterogeneity of patient starting material could impact the ability to manufacture product candidates for clinical or commercial distribution[267](index=267&type=chunk)[268](index=268&type=chunk) [Risks Related to Government Regulation](index=49&type=section&id=Risks%20Related%20to%20Government%20Regulation) This section details regulatory risks, including approval processes, pricing, and data privacy laws - The regulatory approval pathway for novel product candidates is uncertain, complex, expensive, and lengthy, with no guarantee of licensure[269](index=269&type=chunk) - Delays in clinical trials can occur due to regulatory disagreements, patient enrollment difficulties, or unforeseen safety issues, harming commercial prospects and increasing costs[271](index=271&type=chunk)[189](index=189&type=chunk) - Failure to obtain or maintain adequate coverage and reimbursement from governmental and private payors could limit market access and revenue generation for approved products[302](index=302&type=chunk)[306](index=306&type=chunk) - The company is subject to evolving data privacy laws (e.g., GDPR, CCPA, U.S. state laws) and regulations, with non-compliance potentially leading to significant fines, litigation, and reputational harm[327](index=327&type=chunk)[328](index=328&type=chunk)[332](index=332&type=chunk)[334](index=334&type=chunk) - Inadequate funding for regulatory agencies (FDA, SEC) or changes in leadership/policy could delay product review and approval, negatively impacting the business[315](index=315&type=chunk)[317](index=317&type=chunk) [Risks Related to Our Intellectual Property](index=62&type=section&id=Risks%20Related%20to%20Our%20Intellectual%20Property) This section outlines risks concerning patent protection, licensing, and potential infringement claims - Success depends on obtaining and maintaining patent protection for technology and product candidates, but meaningful coverage is uncertain and competitors may design around patents[344](index=344&type=chunk)[345](index=345&type=chunk)[347](index=347&type=chunk) - Patent prosecution is complex, expensive, and inconsistent across jurisdictions, with risks of failing to identify patentable aspects or timely filing applications[350](index=350&type=chunk) - Issued patents may be challenged, narrowed, or invalidated by third parties through litigation or administrative proceedings, reducing protection or allowing competitors to commercialize similar products[351](index=351&type=chunk)[352](index=352&type=chunk)[396](index=396&type=chunk) - Failure to comply with obligations under license agreements could lead to termination, loss of valuable rights, and impairment of product development[356](index=356&type=chunk)[357](index=357&type=chunk) - Limited foreign intellectual property rights and differing legal protections in other countries may hinder the ability to prevent infringement or marketing of competing products globally[399](index=399&type=chunk)[400](index=400&type=chunk) [Risks Related to Our Reliance on Third Parties](index=74&type=section&id=Risks%20Related%20to%20Our%20Reliance%20on%20Third%20Parties) This section details risks from relying on third parties for clinical trials, manufacturing, and collaborations - Reliance on third parties (independent investigators, CROs, CDMOs) for clinical trials means less direct control over conduct, timing, and data quality, potentially leading to delays or termination[410](index=410&type=chunk)[411](index=411&type=chunk) - Collaborations and strategic alliances carry risks, including partners not performing as expected, diverting resources, or developing competing products, potentially delaying or terminating development[417](index=417&type=chunk) - Reliance on a limited number of third-party manufacturers for product candidates exposes the company to risks of manufacturing difficulties, quality issues, and supply disruptions[422](index=422&type=chunk)[423](index=423&type=chunk) - The company's product candidates require specialty materials, some from single or limited suppliers, posing risks of unavailability or delays that could harm clinical or commercial manufacturing[427](index=427&type=chunk)[430](index=430&type=chunk) [Risks Related to Employee Matters and Managing Growth](index=79&type=section&id=Risks%20Related%20to%20Employee%20Matters%20and%20Managing%20Growth) This section outlines risks related to personnel, organizational growth, and product liability - The company is highly dependent on attracting and retaining qualified managerial, scientific, and medical personnel in a competitive biotechnology market[433](index=433&type=chunk)[434](index=434&type=chunk) - Future growth will require additional managerial, operational, sales, marketing, financial, and other personnel, as well as facilities, imposing significant added responsibilities on management[437](index=437&type=chunk) - The company faces an inherent risk of product liability from clinical testing and potential commercialization, which could result in substantial liabilities, decreased demand, and reputational harm[440](index=440&type=chunk)[442](index=442&type=chunk) [Risks Related to Our Common Stock and Our Status as a Public Company](index=81&type=section&id=Risks%20Related%20to%20Our%20Common%20Stock%20and%20Our%20Status%20as%20a%20Public%20Company) This section details risks concerning stock price volatility, ownership concentration, and public company status - The company's stock price is volatile and fluctuates substantially, influenced by factors such as clinical trial results, regulatory actions, and overall market conditions[446](index=446&type=chunk)[448](index=448&type=chunk) - Substantial sales of common stock by directors, executive officers, and significant stockholders could lead to a decline in the stock price[451](index=451&type=chunk)[454](index=454&type=chunk) - The concentration of stock ownership (approximately **25%** by executive officers, directors, and affiliates) limits other stockholders' ability to influence corporate matters[455](index=455&type=chunk) - As an "emerging growth company" and "smaller reporting company," the company benefits from reduced reporting requirements, but this status may make its common stock less attractive to some investors[456](index=456&type=chunk)[459](index=459&type=chunk) - Requirements associated with being a public company significantly increase costs and divert management attention, especially after ceasing to be an "emerging growth company"[461](index=461&type=chunk) - Delaware law and provisions in the company's amended and restated certificate of incorporation and bylaws could make mergers, tender offers, or proxy contests difficult, potentially depressing the stock price[469](index=469&type=chunk)[472](index=472&type=chunk)[473](index=473&type=chunk) [General Risk Factors](index=86&type=section&id=General%20Risk%20Factors) This section covers general risks including tax changes, inflation, litigation, and business disruptions - Changes in tax legislation (federal, state, local, and non-U.S.) could adversely affect the business and financial condition[475](index=475&type=chunk) - Rising inflation rates may result in increased operating costs, reduced liquidity, and limitations on the ability to access credit[478](index=478&type=chunk) - The company could be subject to securities class action litigation, which would result in substantial costs and a diversion of management's attention and resources[479](index=479&type=chunk) - Business disruptions from natural or man-made disasters (e.g., earthquakes, power shortages, medical epidemics) could seriously harm future revenue and financial condition[480](index=480&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=87&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section reports no unregistered equity sales and details IPO proceeds use - No unregistered sales of equity securities occurred during the period[482](index=482&type=chunk) - The July 2021 IPO generated aggregate net cash proceeds of **$89.6 million**, and there has been no material change in the planned use of these proceeds[482](index=482&type=chunk) [Item 3. Defaults Upon Senior Securities](index=87&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is marked as 'Not Applicable', indicating no defaults upon senior securities - This item is marked as "Not Applicable," indicating no defaults upon senior securities[483](index=483&type=chunk) [Item 4. Mine Safety Disclosures](index=87&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is marked as 'Not Applicable', indicating no mine safety disclosures - This item is marked as "Not Applicable," indicating no mine safety disclosures[483](index=483&type=chunk) [Item 5. Other Information](index=87&type=section&id=Item%205.%20Other%20Information) This section confirms no Rule 10b5-1 trading arrangements were adopted, modified, or terminated by directors or officers - None of the company's directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2025[483](index=483&type=chunk) [Item 6. Exhibits](index=87&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including key corporate documents and certifications - Exhibits include the Amended and Restated Certificate of Incorporation and Bylaws, certifications of the Principal Executive Officer and Principal Financial Officer, and Inline XBRL documents[484](index=484&type=chunk) [Signatures](index=88&type=section&id=Signatures) The report is duly signed by the Chief Executive Officer and Chief Financial Officer - The report was signed by Gavin MacBeath, Chief Executive Officer, and Jason A. Amello, Chief Financial Officer, on August 12, 2025[486](index=486&type=chunk)

Exhibit 99.1 CalciMedica Reports Second Quarter 2025 Financial Results and Provides Clinical & Corporate Updates Enrollment ongoing in Phase 2 KOURAGE trial of Auxora™ in acute kidney injury (AKI) with respiratory failure; data expected in early 2026 Productive initial meeting with the FDA on Auxora in acute pancreatitis (AP); conversations continue, with alignment on a pivotal trial anticipated around the end of 2025 Cash position expected to fund operations into mid-2026 LA JOLLA, Calif., August 12, 2025 ...

Productive initial meeting with the FDA on Auxora in acute pancreatitis (AP); conversations continue, with alignment on a pivotal trial anticipated around the end of 2025 Cash position expected to fund operations into mid-2026 LA JOLLA, Calif., August 12, 2025 – CalciMedica Inc. ("CalciMedica" or the "Company") (Nasdaq: CALC), a clinical-stage biopharmaceutical company focused on developing novel calcium release-activated calcium (CRAC) channel inhibition therapies for acute and chronic inflammatory and imm ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES Zenas BioPharma, Inc. (Exact name of registrant as specified in its charter) Delaware 93-2749244 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification N ...

Milestone Strengthens Balance Sheet to Fully Commercialize CARDAMYST if Approved Public Of ering Raised Total Gross Proceeds of up to $170 Million if all Warrants are Exercised $75 Million Royalty Purchase Agreement Payment from RTW Extended Through End of 2025 Exhibit 99.1 Milestone Pharmaceuticals Reports Second Quarter 2025 Financial Results and Provides Regulatory and Corporate Update FDA Accepted the Company's Response to the CRL for CARDAMYST™ (etripamil) Nasal Spray; New PDUFA Target Date of December ...

PART I. FINANCIAL INFORMATION This section presents the unaudited interim financial statements and management's analysis for the period ended June 30, 2025 [Item 1. Interim Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Interim%20Financial%20Statements%20(Unaudited)) The unaudited interim financial statements for June 30, 2025, report a net loss of $24.8 million and total assets of $79.2 million [Balance Sheets](index=5&type=section&id=Balance%20Sheets) Total assets decreased to $79.2 million by June 30, 2025, with cash increasing to $57.6 million and equity declining Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $57,626 | $37,573 | | Marketable securities | $0 | $39,183 | | Total current assets | $60,315 | $78,815 | | Total assets | $79,198 | $102,412 | | **Liabilities & Equity** | | | | Total liabilities | $40,940 | $41,151 | | Total stockholders' equity | $38,258 | $61,261 | | Accumulated deficit | $(684,025) | $(659,235) | [Statements of Operations and Comprehensive Loss](index=6&type=section&id=Statements%20of%20Operations%20and%20Comprehensive%20Loss) Net loss improved to $9.4 million for Q2 2025 and $24.8 million for six months, due to lower operating expenses Operating Results (in thousands, except per share data) | Metric | 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 | $5,814 | $10,430 | $13,551 | $21,965 | | General and administrative | $4,520 | $6,510 | $10,605 | $13,025 | | Impairment of long-lived assets | $0 | $438 | $2,637 | $438 | | Loss from operations | $(10,334) | $(17,378) | $(26,793) | $(35,428) | | Net loss | $(9,385) | $(15,991) | $(24,790) | $(32,702) | | Net loss per share | $(2.96) | $(5.09) | $(7.83) | $(10.87) | [Statements of Stockholders' Equity](index=7&type=section&id=Statements%20of%20Stockholders'%20Equity) Stockholders' equity decreased to $38.3 million by June 30, 2025, primarily due to a $24.8 million net loss - Total stockholders' equity decreased by **$22.9 million** in the first six months of 2025, mainly due to the net loss of **$24.8 million**[19](index=19&type=chunk) [Statements of Cash Flows](index=9&type=section&id=Statements%20of%20Cash%20Flows) Net cash used in operations was $20.2 million, with investing activities providing $40.2 million, increasing cash to $57.6 million Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(20,177) | $(32,065) | | Net cash provided by investing activities | $40,216 | $26,299 | | Net cash provided by financing activities | $14 | $8,827 | | **Net increase in cash** | **$20,053** | **$3,061** | | **Cash at end of period** | **$57,626** | **$24,770** | [Notes to Unaudited Interim Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Interim%20Financial%20Statements) Notes detail the company's focus on neurodegenerative therapies, recurring losses, $684.0 million accumulated deficit, and a 12-month cash runway - The company is a clinical-stage genetic medicines company focused on neurodegenerative diseases, with its lead candidate being **PBFT02** for frontotemporal dementia (FTD-GRN)[25](index=25&type=chunk) - As of June 30, 2025, the company had an accumulated deficit of **$684.0 million** but expects its current cash and cash equivalents to be sufficient to fund operations for at least the next 12 months[26](index=26&type=chunk)[30](index=30&type=chunk)[31](index=31&type=chunk) - A **1-for-20 reverse stock split** was effected on July 14, 2025, to regain Nasdaq compliance, with all share and per-share data retroactively adjusted[34](index=34&type=chunk)[118](index=118&type=chunk) - In January 2025, the company reduced its workforce by **55%** and ceased lab operations, incurring **$1.7 million** in severance and a **$2.6 million** impairment charge[47](index=47&type=chunk)[85](index=85&type=chunk)[86](index=86&type=chunk) - The company out-licensed three programs to Gemma Biotherapeutics, receiving **$9.7 million** in payments recorded as a liability pending revenue recognition[81](index=81&type=chunk)[84](index=84&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=43&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses PBFT02, reduced operating losses, a $57.6 million cash runway into Q1 2027, and strategic business developments [Overview and Pipeline](index=43&type=section&id=Overview%20and%20Pipeline) The company focuses on neurodegenerative genetic medicines, with lead candidate PBFT02 for FTD-GRN, and out-licensed three pediatric programs - The lead clinical product candidate is **PBFT02**, a gene therapy for FTD-GRN, showing robust increases in CSF progranulin (PGRN) levels in the upliFT-D trial[140](index=140&type=chunk)[149](index=149&type=chunk) - Development of **PBFT02** is expanding to FTD-C9orf72 and ALS, with positive regulatory feedback on the clinical pathway[141](index=141&type=chunk)[153](index=153&type=chunk)[159](index=159&type=chunk) - Three pediatric programs (for GM1, Krabbe disease, and MLD) have been out-licensed to Gemma Biotherapeutics[142](index=142&type=chunk) [Results of Operations](index=57&type=section&id=Results%20of%20Operations) Operating results improved, with net loss decreasing to $9.4 million for Q2 2025 and $24.8 million for H1 2025, due to reduced R&D and G&A Comparison of Operating Results (in thousands) | Period | Metric | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | :--- | | **Three Months Ended June 30** | R&D Expenses | $5,814 | $10,430 | $(4,616) | | | G&A Expenses | $4,520 | $6,510 | $(1,990) | | | **Net Loss** | **$(9,385)** | **$(15,991)** | **$6,606** | | **Six Months Ended June 30** | R&D Expenses | $13,551 | $21,965 | $(8,414) | | | G&A Expenses | $10,605 | $13,025 | $(2,420) | | | **Net Loss** | **$(24,790)** | **$(32,702)** | **$7,912** | - The decrease in R&D expenses was primarily due to lower preclinical research costs, reduced wages and benefits from lower headcount, and decreased facility and manufacturing expenses following the cessation of lab operations in Hopewell, New Jersey[193](index=193&type=chunk)[197](index=197&type=chunk)[201](index=201&type=chunk) - An impairment charge of **$2.6 million** was recorded in the first six months of 2025 related to laboratory equipment that was subsequently sold[204](index=204&type=chunk) [Liquidity and Capital Resources](index=63&type=section&id=Liquidity%20and%20Capital%20Resources) The company holds $57.6 million in cash, with a runway into Q1 2027, and reduced net cash used in operations to $20.2 million - The company's cash and cash equivalents of **$57.6 million** as of June 30, 2025, are expected to provide a cash runway into the **first quarter of 2027**[168](index=168&type=chunk)[206](index=206&type=chunk) - Net cash used in operating activities decreased to **$20.2 million** for the first half of 2025 from **$32.1 million** in the first half of 2024, reflecting lower operating expenses[213](index=213&type=chunk)[214](index=214&type=chunk)[215](index=215&type=chunk) - The company has an ATM facility with **$15.8 million** of capacity remaining, though its use is limited by 'baby shelf' rules due to its public float[211](index=211&type=chunk)[257](index=257&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=70&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company has indicated that quantitative and qualitative disclosures about market risk are not applicable - The company has indicated that quantitative and qualitative disclosures about market risk are not applicable[234](index=234&type=chunk) [Item 4. Controls and Procedures](index=70&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective as of June 30, 2025, with no material changes to internal controls - Management concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective[235](index=235&type=chunk) - No material changes were made to the internal control over financial reporting during the quarter ended June 30, 2025[236](index=236&type=chunk) PART II. OTHER INFORMATION This section covers legal proceedings, risk factors, equity sales, defaults, and other required disclosures [Item 1. Legal Proceedings](index=71&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in ongoing litigation with a former employee regarding a disputed settlement, with a favorable judgment under appeal - The company is involved in ongoing litigation with a former employee regarding a disputed settlement agreement from 2020[239](index=239&type=chunk) - A trial judge delivered a judgment in the company's favor in December 2024, finding no binding agreement was reached, with the plaintiff's appeal pending[115](index=115&type=chunk)[239](index=239&type=chunk) [Item 1A. Risk Factors](index=71&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant financial, development, third-party reliance, commercialization, and regulatory risks, including losses and dependence on PBFT02 - **Financial Risks:** The company has a history of operating losses (**$684.0 million** accumulated deficit) and will need to raise additional capital, which may not be available on acceptable terms[242](index=242&type=chunk)[245](index=245&type=chunk)[253](index=253&type=chunk) - **Development Risks:** The business is dependent on its sole clinical candidate, **PBFT02**, with gene therapy development being lengthy, expensive, and uncertain[244](index=244&type=chunk)[261](index=261&type=chunk)[270](index=270&type=chunk) - **Third-Party Reliance:** The company relies on Gemma for preclinical research and Catalent for manufacturing, creating risks related to performance and disruptions[317](index=317&type=chunk)[322](index=322&type=chunk)[348](index=348&type=chunk) - **Commercialization & Regulatory Risks:** Significant competition, market acceptance, pricing, reimbursement, and a complex, evolving regulatory landscape pose substantial challenges[369](index=369&type=chunk)[374](index=374&type=chunk)[433](index=433&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=175&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company reported no unregistered sales of equity securities during the reporting period - The company reported no unregistered sales of equity securities for the period[534](index=534&type=chunk) [Item 3. Defaults Upon Senior Securities](index=175&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities during the period - There were no defaults upon senior securities[536](index=536&type=chunk) [Item 4. Mine Safety Disclosures](index=175&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to the company - Mine safety disclosures are not applicable[537](index=537&type=chunk) [Item 5. Other Information](index=175&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted, modified, or terminated a Rule 10b5-1 trading plan during the quarter - No directors or officers adopted, modified, or terminated a Rule 10b5-1 trading plan during the quarter[538](index=538&type=chunk) [Item 6. Exhibits](index=176&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including license agreement amendments and SOX certifications - Filed exhibits include amendments to license agreements with Gemma Biotherapeutics, Inc. for the GM1, Krabbe, and MLD programs[541](index=541&type=chunk) - Certifications by the CEO and CFO as required by Sections 302 and 906 of the Sarbanes-Oxley Act are included as exhibits[541](index=541&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-40708 CLIMB BIO, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 83-2273741 (State or other jurisdiction of i ...

[PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section details Climb Bio's unaudited condensed consolidated financial statements and management's financial analysis [Item 1. Condensed Consolidated Financial Statements (unaudited)](index=6&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(unaudited)) Climb Bio's unaudited condensed consolidated financial statements, covering balance sheets, operations, equity, cash flows, and detailed notes [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance sheets show decreased total assets and equity, increased liabilities, driven by reduced cash and cash equivalents Condensed Consolidated Balance Sheets (thousands) | Metric | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change ($ thousands) | | :-------------------------- | :---------------------------- | :------------------------------ | :------------------- | | Total Assets | 192,386 | 217,187 | (24,801) | | Total Liabilities | 6,622 | 5,306 | 1,316 | | Total Stockholders' Equity | 185,764 | 211,881 | (26,117) | | Cash and cash equivalents | 22,682 | 87,229 | (64,547) | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Net loss significantly reduced for Q2 and H1 2025, primarily due to the absence of a large acquired in-process R&D expense in 2024 Condensed Consolidated Statements of Operations and Comprehensive Loss (thousands) | Metric | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :------------------------------------------ | :--------------------------------------------- | :--------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net Loss | (8,666) | (54,889) | (29,447) | (56,586) | | Acquired in-process research and development, related party | — | 51,659 | — | 51,659 | | Research and development | 6,575 | 1,046 | 23,902 | 2,137 | | General and administrative | 4,102 | 3,667 | 9,793 | 5,581 | | Interest income | 2,173 | 1,485 | 4,460 | 2,826 | - Net loss decreased by **$46,223 thousand** for the three months ended June 30, 2025, and by **$27,139 thousand** for the six months ended June 30, 2025, compared to the respective periods in 2024, largely due to the absence of the **$51,659 thousand** acquired in-process R&D expense in 2025[17](index=17&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Stockholders' equity statements reflect changes from December 2024 to June 2025, driven by net losses, stock-based compensation, and unrealized gains Condensed Consolidated Statements of Stockholders' Equity (thousands) | Metric | December 31, 2024 ($ thousands) | June 30, 2025 ($ thousands) | | :-------------------------------- | :------------------------------ | :-------------------------- | | Total Stockholders' Equity | 211,881 | 185,764 | | Accumulated Deficit | (229,876) | (259,323) | | Additional Paid-in Capital | 441,727 | 444,762 | | Accumulated Other Comprehensive Income | 23 | 318 | - The accumulated deficit increased by **$29,447 thousand** from December 31, 2024, to June 30, 2025, reflecting the net loss for the six-month period[17](index=17&type=chunk)[20](index=20&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) H1 2025 cash flows show significant usage in operating and investing activities, contrasting with prior year's financing cash from a private placement Condensed Consolidated Statements of Cash Flows (thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :-------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net cash used in operating activities | (26,582) | (2,486) | | Net cash provided by (used in) investing activities | (37,965) | 4,106 | | Net cash provided by financing activities | — | 128,417 | | Net change in cash and cash equivalents | (64,547) | 130,028 | | Cash and cash equivalents at end of period | 22,682 | 223,140 | - Net cash used in operating activities increased by **$24,096 thousand** in H1 2025 compared to H1 2024, primarily due to a lower non-cash IPR&D charge in 2025[22](index=22&type=chunk)[128](index=128&type=chunk)[129](index=129&type=chunk) - Investing activities shifted from providing cash in H1 2024 to using **$37,965 thousand** in H1 2025, mainly due to increased purchases of marketable securities[22](index=22&type=chunk)[130](index=130&type=chunk)[131](index=131&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Detailed notes explain Climb Bio's operations, accounting policies, acquisitions, licensing, financial instruments, commitments, stock compensation, net loss per share, segments, and subsequent events [1. Nature of Operations and Basis of Presentation](index=10&type=section&id=1.%20Nature%20of%20Operations%20and%20Basis%20of%20Presentation) Climb Bio is a clinical-stage biotech developing budoprutug and CLYM116, acquired Tenet, licensed CLYM116, and has **$259.3 million** accumulated deficit but sufficient capital for 12 months - Climb Bio, Inc. is a clinical-stage biotechnology company developing therapeutics for patients with immune-mediated diseases, with a pipeline including budoprutug and CLYM116[24](index=24&type=chunk) - The company completed the acquisition of Tenet Medicines, Inc. on June 27, 2024, and entered into an exclusive license agreement with Beijing Mabworks Biotech Co., Ltd. for CLYM116 rights on January 8, 2025[25](index=25&type=chunk)[26](index=26&type=chunk) - As of June 30, 2025, the company had an accumulated deficit of **$259.3 million** but believes its available cash, cash equivalents, and marketable securities of **$187.4 million** will be sufficient to meet operating requirements for at least the next twelve months[32](index=32&type=chunk)[33](index=33&type=chunk) [2. Summary of Significant Accounting Policies](index=11&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) Climb Bio, an emerging growth company, delays new accounting standards, reports no material policy changes, and details policies on credit risk, suppliers, foreign currency, and fair value measurements - The company is an emerging growth company and has elected to use the extended transition period for complying with new or revised accounting standards[34](index=34&type=chunk) - No material changes to the company's significant accounting policies were reported from the Annual Report on Form 10-K for the year ended December 31, 2024[35](index=35&type=chunk) - The company relies on single-source suppliers and manufacturers for certain critical materials, posing a risk if these third parties fail to meet obligations[38](index=38&type=chunk) - Financial assets and liabilities measured at fair value are classified into Level 1 (quoted prices in active markets) and Level 2 (observable inputs other than Level 1) of the fair value hierarchy[40](index=40&type=chunk)[42](index=42&type=chunk) [3. Asset Acquisition and Private Placement with a Related Party](index=13&type=section&id=3.%20Asset%20Acquisition%20and%20Private%20Placement%20with%20a%20Related%20Party) Climb Bio acquired Tenet Medicines for **$52.8 million** on June 27, 2024, expensing **$51.7 million** as IPR&D, and raised **$120.0 million** from a concurrent private placement - The company completed the acquisition of Tenet Medicines, Inc. on June 27, 2024, which was accounted for as an asset acquisition[46](index=46&type=chunk)[48](index=48&type=chunk) - Total consideration for the acquisition was **$52.8 million**, with **$51.7 million** allocated to in-process research and development (IPR&D) and expensed due to no future alternative use[48](index=48&type=chunk) - A concurrent private placement generated approximately **$120.0 million** in gross proceeds from the issuance of **31,238,282** shares of common stock[25](index=25&type=chunk)[47](index=47&type=chunk) [4. Marketable Securities](index=14&type=section&id=4.%20Marketable%20Securities) Climb Bio's available-for-sale marketable securities primarily include corporate bonds, U.S. Treasury securities, and U.S. government agency debt securities, with long-term maturities between one and two years as of June 30, 2025 Marketable Securities (thousands) | Type | Amortized Cost ($ thousands) | Unrealized Gain ($ thousands) | Unrealized Loss ($ thousands) | Estimated Fair Value ($ thousands) | | :-------------------------------- | :--------------------------- | :---------------------------- | :---------------------------- | :------------------------------- | | **Short-term (June 30, 2025):** | | | | | | Corporate bonds | 35,127 | 20 | (4) | 35,143 | | U.S. Treasury securities | 26,860 | 20 | (2) | 26,878 | | **Total Short-term** | **61,987** | **40** | **(6)** | **62,021** | | **Long-term (June 30, 2025):** | | | | | | Corporate bonds | 69,676 | 193 | (3) | 69,866 | | U.S. Treasury securities | 20,242 | 103 | — | 20,345 | | U.S. government agency debt securities | 12,500 | 1 | (10) | 12,491 | | **Total Long-term** | **102,418** | **297** | **(13)** | **102,702** | - Long-term marketable securities as of June 30, 2025, have contractual maturity dates between one and two years[49](index=49&type=chunk) [5. Fair Value Measurements](index=14&type=section&id=5.%20Fair%20Value%20Measurements) Climb Bio measures financial assets at fair value, categorizing cash equivalents and U.S. Treasury securities as Level 1, and corporate bonds and U.S. government agency debt securities as Level 2, with no Level 3 transfers Fair Value Measurements at June 30, 2025 (thousands) | Asset Type | Level 1 ($ thousands) | Level 2 ($ thousands) | Level 3 ($ thousands) | Total ($ thousands) | | :-------------------------------- | :-------------------- | :-------------------- | :-------------------- | :------------------ | | **Fair Value Measurements at June 30, 2025:** | | | | | | Cash equivalents: Money market funds | 22,072 | — | — | 22,072 | | Marketable securities: U.S. Treasury securities | 47,223 | — | — | 47,223 | | Marketable securities: Corporate bonds | — | 105,009 | — | 105,009 | | Marketable securities: U.S. government agency debt securities | — | 12,491 | — | 12,491 | | **Total Assets** | **69,295** | **117,500** | **—** | **186,795** | - Cash equivalents and U.S. Treasury securities are valued based on quoted market prices (Level 1), while corporate bonds and agency securities are valued using quoted prices for similar securities (Level 2)[51](index=51&type=chunk) [6. Accrued Expenses and Other Current Liabilities](index=16&type=section&id=6.%20Accrued%20Expenses%20and%20Other%20Current%20Liabilities) Accrued expenses and other current liabilities increased to **$5.0 million** as of June 30, 2025, from **$4.1 million** at December 31, 2024, primarily due to higher accrued external research and development expenses Accrued Expenses and Other Current Liabilities (thousands) | Category | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change ($ thousands) | | :-------------------------------------- | :------------------------------ | :------------------------------ | :------------------- | | Accrued external research and development expenses | 3,614 | 1,237 | 2,377 | | Accrued payroll and related expenses | 914 | 1,997 | (1,083) | | Accrued professional fees | 472 | 746 | (274) | | Other accrued expenses and current liabilities | 37 | 89 | (52) | | **Total** | **5,037** | **4,069** | **968** | [7. Commitments and Contingencies](index=16&type=section&id=7.%20Commitments%20and%20Contingencies) Climb Bio has office lease obligations and significant contingent payment obligations under license agreements for budoprutug and CLYM116, including development, regulatory, commercial milestones, and royalties - The company amended its office lease in April 2025, adding **$0.2 million** in fixed payments through 2026, with an option to extend through 2027 for an additional **$0.1 million**[53](index=53&type=chunk) - Under the Acelyrin Asset Purchase Agreement, the company is obligated to make payments of up to **$157.5 million** upon achievement of various development, regulatory, and commercial milestones for budoprutug, plus single-digit royalties[57](index=57&type=chunk) - The Mabworks Agreement for CLYM116 includes a **$9.0 million** upfront payment (recorded as R&D expense in Q1 2025), up to **$30.0 million** for development/regulatory milestones for the first indication, additional amounts for up to two more indications, and up to **$832.0 million** for commercial milestones, plus tiered royalties[63](index=63&type=chunk)[65](index=65&type=chunk) - Milestone payments are recorded as expense when achievement is assessed as probable; as of June 30, 2025, **$0.8 million** was recorded for a ProBioGen milestone, but no other milestone expenses were recorded for Acelyrin, CRH, or Mabworks agreements[57](index=57&type=chunk)[59](index=59&type=chunk)[61](index=61&type=chunk)[65](index=65&type=chunk) [8. Stock-Based Compensation](index=20&type=section&id=8.%20Stock-Based%20Compensation) Climb Bio operates multiple equity incentive plans and an Employee Stock Purchase Plan, with stock-based compensation expense significantly increasing in 2025 and **$11.1 million** in unrecognized cost for unvested awards - The company has outstanding awards under its 2019 and 2021 Equity Incentive Plans, and adopted a 2025 Inducement Plan for new employees[68](index=68&type=chunk)[70](index=70&type=chunk) Outstanding Stock Options and Unvested Restricted Stock Units | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Outstanding Stock Options | 5,663,022 | 2,817,751 | | Unvested Restricted Stock Units | 627,710 | 1,228,876 | Stock-Based Compensation Expense (thousands) | Expense Category | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :-------------------------------------- | :--------------------------------------------- | :--------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Research and development expenses | 521 | 287 | 1,427 | 556 | | General and administrative expenses | 492 | 225 | 1,608 | 421 | | **Total Stock-Based Compensation Expense** | **1,013** | **512** | **3,035** | **977** | - As of June 30, 2025, there was **$11.1 million** of total unrecognized compensation cost for unvested awards, and an additional **$3.0 million** for performance-based RSUs that became probable of vesting in August 2025[77](index=77&type=chunk) [9. Net Loss Per Share](index=22&type=section&id=9.%20Net%20Loss%20Per%20Share) Climb Bio reported a net loss for all periods, resulting in identical basic and diluted net loss per share due to the anti-dilutive effect of potentially dilutive securities - The company has generated a net loss in all periods presented, making basic and diluted net loss per share identical as potentially dilutive securities would be anti-dilutive[78](index=78&type=chunk) Potentially Dilutive Securities | Potentially Dilutive Securities | June 30, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------ | | Stock options to purchase common stock | 5,663,022 | 2,834,181 | | Unvested restricted stock awards and units | 627,710 | 1,233,943 | | **Total potentially dilutive shares** | **6,290,732** | **4,068,124** | [10. Segments](index=22&type=section&id=10.%20Segments) Climb Bio operates as a single segment focused on immune-mediated diseases, with R&D expenses disaggregated by program, showing significant increases in budoprutug and CLYM116 costs in 2025 - The company views its operations and manages its business as one operating and reportable segment, focused on developing therapeutics for patients with immune-mediated diseases[79](index=79&type=chunk) Direct Research and Development Expenses (thousands) | Direct Research and Development Expenses | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | | :--------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :------------------- | | Budoprutug | 10,662 | 42 | 10,620 | | CLYM116 | 9,265 | — | 9,265 | | Legacy programs | 73 | 107 | (34) | | Personnel-related | 3,209 | 1,825 | 1,384 | | Other research and development expenses | 693 | 163 | 530 | | **Total Research and Development Expenses** | **23,902** | **2,137** | **21,765** | - CLYM116 expenses for the six months ended June 30, 2025, include a **$9.0 million** upfront payment and associated direct transaction costs related to the Mabworks Agreement[81](index=81&type=chunk) [11. Subsequent Events](index=24&type=section&id=11.%20Subsequent%20Events) The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, with potential impacts on federal tax law and other regulations, which the company is currently evaluating - The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, after the reporting period[82](index=82&type=chunk) - The OBBBA includes significant changes to federal tax law and other regulatory provisions, the impact of which the company is currently evaluating[82](index=82&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results and Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20and%20Operations) This section provides management's perspective on Climb Bio's financial condition and results of operations, highlighting its clinical-stage status, recent acquisitions, operating expenses, liquidity, and future funding needs [Overview](index=25&type=section&id=Overview) Climb Bio is a clinical-stage biotech developing budoprutug and CLYM116, with significant operating losses and an accumulated deficit, but expects current capital to fund operations through 2027 - Climb Bio is a clinical-stage biotechnology company developing potential best-in-class therapeutics for immune-mediated diseases, with lead product candidate budoprutug and preclinical stage CLYM116[85](index=85&type=chunk)[89](index=89&type=chunk)[92](index=92&type=chunk) - The company received FDA clearance for Phase 2 clinical trial of budoprutug in pMN (March 2025) and IND clearances for Phase 1b in SLE (October 2024) and Phase 1b/2a in ITP (March 2025). A Phase 1 clinical trial for SC formulation of budoprutug is anticipated in H2 2025[91](index=91&type=chunk) - CLYM116 is currently in IND-enabling studies, with preclinical data expected in September 2025 and IND/CTA submission for IgAN anticipated in the second half of 2025[92](index=92&type=chunk) - The company incurred net losses of **$8.7 million** and **$29.4 million** for the three and six months ended June 30, 2025, respectively, with an accumulated deficit of **$259.3 million** as of June 30, 2025[94](index=94&type=chunk) - Existing cash, cash equivalents, and marketable securities of **$187.4 million** as of June 30, 2025, are estimated to fund planned operations through 2027[97](index=97&type=chunk) [Tenet Acquisition](index=29&type=section&id=Tenet%20Acquisition) On June 27, 2024, Climb Bio acquired Tenet Medicines, Inc. for **$41.9 million** in common stock, expensing **$51.7 million** as in-process research and development - Climb Bio acquired **100%** of Tenet Medicines, Inc. on June 27, 2024, in exchange for **5,560,047** shares of common stock, valued at **$41.9 million**[98](index=98&type=chunk) - The acquisition was accounted for as an asset acquisition, with **$51.7 million** recognized as in-process research and development (IPR&D) expense[98](index=98&type=chunk) [Mabworks Agreement](index=29&type=section&id=Mabworks%20Agreement) On January 8, 2025, Climb Bio licensed CLYM116 rights from Mabworks, involving a **$9.0 million** upfront payment expensed as R&D, plus future milestone and royalty obligations - On January 8, 2025, Climb Bio entered into the Mabworks Agreement for exclusive rights to develop and commercialize CLYM116 outside of Greater China[99](index=99&type=chunk) - A **$9.0 million** upfront cash payment was made to Mabworks and included in research and development expenses for the first quarter of 2025[99](index=99&type=chunk) - The agreement includes obligations for additional payments upon achievement of specified development, regulatory, and commercial milestones, and low-to-mid single-digit tiered royalties on net sales[99](index=99&type=chunk) [Components of Operating Results](index=29&type=section&id=Components%20of%20Operating%20Results) Operating expenses include R&D, acquired IPR&D, and G&A, all expected to increase, while other income primarily consists of interest earned on cash and marketable securities - Operating expenses are categorized into research and development, acquired in-process research and development (related party), and general and administrative expenses[100](index=100&type=chunk) - Research and development costs are expensed as incurred and are expected to increase substantially in the foreseeable future due to ongoing development activities[101](index=101&type=chunk)[103](index=103&type=chunk) - General and administrative expenses, primarily personnel-related and professional fees, are also expected to increase to support growth and potential commercialization activities[108](index=108&type=chunk)[109](index=109&type=chunk) [Research and Development](index=29&type=section&id=Research%20and%20Development) R&D expenses, including employee costs, preclinical/clinical development, manufacturing, facilities, and licensing, are expensed as incurred and are expected to increase significantly as product candidates advance - R&D expenses include employee-related costs, expenses for preclinical and clinical development (CROs, consultants), third-party manufacturing, facilities, and payments under licensing agreements[104](index=104&type=chunk) - Direct R&D expenses are tracked program-by-program, while indirect costs like employee and facility expenses are not allocated to specific programs[102](index=102&type=chunk) - R&D expenses are expected to increase substantially due to ongoing research, preclinical studies, and clinical trials, with timelines and costs being highly uncertain[103](index=103&type=chunk)[104](index=104&type=chunk) [Acquired In-Process Research and Development, Related Party](index=31&type=section&id=Acquired%20In-Process%20Research%20and%20Development,%20Related%20Party) Acquired IPR&D expense represents the fair value of consideration transferred in the Tenet Acquisition, allocated to R&D assets with no alternative future use - Acquired IPR&D expense consists of the fair value of consideration transferred in the Tenet Acquisition, allocated to R&D assets with no alternative future use[107](index=107&type=chunk) [General and Administrative](index=31&type=section&id=General%20and%20Administrative) General and administrative expenses, primarily personnel-related costs, legal fees, and professional services, are expected to increase with company growth and potential commercialization - General and administrative expenses primarily include personnel-related costs (salaries, bonuses, stock-based compensation), legal fees, professional fees (accounting, audit, consulting), insurance, and investor relations[108](index=108&type=chunk) - These expenses are expected to increase as the company expands its headcount to support growth strategy and potential commercialization activities[109](index=109&type=chunk) [Other Income (Expense)](index=31&type=section&id=Other%20Income%20(Expense)) Other income primarily consists of interest earned on cash, cash equivalents, and marketable securities, while foreign currency loss accounts for exchange rate fluctuations - Interest income is derived from interest earned on cash, cash equivalents, and marketable securities[110](index=110&type=chunk) - Foreign currency loss results from the remeasurement of foreign currency transactions to the U.S. Dollar[111](index=111&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) This section compares Climb Bio's financial performance for Q2 and H1 2025 against 2024, detailing changes in operating expenses, other income, and net loss [Comparison of the Three Months Ended June 30, 2025 and 2024](index=32&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20June%2030,%202025%20and%202024) Net loss significantly decreased by **$46.2 million** in Q2 2025 due to the absence of a **$51.7 million** acquired IPR&D expense in Q2 2024, while R&D and G&A expenses increased Comparison of the Three Months Ended June 30, 2025 and 2024 (thousands) | Metric | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | | :------------------------------------------ | :--------------------------------------------- | :--------------------------------------------- | :------------------- | | Net Loss | (8,666) | (54,889) | 46,223 | | Research and development | 6,575 | 1,046 | 5,529 | | Acquired in-process research and development, related party | — | 51,659 | (51,659) | | General and administrative | 4,102 | 3,667 | 435 | | Interest income | 2,173 | 1,485 | 688 | - Research and development expenses increased by **$5.5 million**, primarily due to **$4.5 million** in costs for the budoprutug program related to clinical trial start-up and manufacturing[114](index=114&type=chunk) - General and administrative expenses increased by **$0.4 million** due to higher personnel-related expenses from increased headcount[116](index=116&type=chunk) [Comparison of the Six Months Ended June 30, 2025 and 2024](index=33&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20June%2030,%202025%20and%202024) Net loss decreased by **$27.1 million** in H1 2025 due to the absence of a **$51.7 million** acquired IPR&D expense in H1 2024, while R&D and G&A expenses significantly increased Comparison of the Six Months Ended June 30, 2025 and 2024 (thousands) | Metric | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | Change ($ thousands) | | :------------------------------------------ | :-------------------------------------------- | :-------------------------------------------- | :------------------- | | Net Loss | (29,447) | (56,586) | 27,139 | | Research and development | 23,902 | 2,137 | 21,765 | | Acquired in-process research and development, related party | — | 51,659 | (51,659) | | General and administrative | 9,793 | 5,581 | 4,212 | | Interest income | 4,460 | 2,826 | 1,634 | - Research and development expenses increased by **$21.8 million**, including **$10.6 million** for the budoprutug program and **$9.3 million** for the CLYM116 program (primarily a **$9.0 million** upfront payment)[120](index=120&type=chunk) - General and administrative expenses increased by **$4.2 million**, driven by a **$2.3 million** increase in personnel-related expenses and a **$1.2 million** increase in legal expenses[122](index=122&type=chunk) [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses Climb Bio's liquidity, cash flow, future funding needs, and contractual obligations, noting reliance on equity financing and anticipated capital sufficiency through 2027 [Sources of Liquidity](index=34&type=section&id=Sources%20of%20Liquidity) Climb Bio primarily funds operations through equity sales, has no product revenue, and held **$187.4 million** in cash, cash equivalents, and marketable securities as of June 30, 2025 - The company has primarily funded operations through net proceeds from equity sales, including redeemable convertible preferred stock, an IPO, and a private placement in June 2024[125](index=125&type=chunk) - As of June 30, 2025, the company had **$187.4 million** in cash, cash equivalents, and marketable securities[125](index=125&type=chunk) - An Equity Distribution Agreement was entered into in March 2025 to sell up to **$22.4 million** in common stock via an at-the-market offering, but no shares were sold during the three and six months ended June 30, 2025[126](index=126&type=chunk) [Cash Flows](index=34&type=section&id=Cash%20Flows) H1 2025 saw **$26.6 million** net cash used in operating activities and **$38.0 million** in investing, contrasting with H1 2024's **$128.4 million** provided by financing activities Cash Flow Activities (thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :-------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net cash used in operating activities | (26,582) | (2,486) | | Net cash provided by (used in) investing activities | (37,965) | 4,106 | | Net cash provided by financing activities | — | 128,417 | - Net cash used in operating activities for H1 2025 was **$26.6 million**, primarily from a net loss of **$29.4 million**, partially offset by non-cash charges and changes in operating assets/liabilities[128](index=128&type=chunk) - Net cash used in investing activities for H1 2025 was **$38.0 million**, mainly due to purchases of marketable securities, partially offset by maturities[130](index=130&type=chunk) - Net cash provided by financing activities for H1 2024 was **$128.4 million**, primarily from a private placement (**$119.7 million**) and stock option exercises (**$8.7 million**)[133](index=133&type=chunk) [Funding Requirements](index=36&type=section&id=Funding%20Requirements) Climb Bio's existing capital is estimated to fund operations through 2027, but increased expenses for product development and commercialization will necessitate substantial additional future capital - Existing cash, cash equivalents, and marketable securities are believed to be sufficient to fund operations through 2027, based on current operating plans[134](index=134&type=chunk) - Expenses are expected to increase for advancing product candidates, expanding corporate infrastructure, and potential commercialization, necessitating substantial additional capital in the future[134](index=134&type=chunk)[135](index=135&type=chunk) - Failure to obtain necessary capital on acceptable terms could force delays, reductions, or termination of product development programs, commercialization efforts, or other operations[136](index=136&type=chunk) [Contractual Commitments and Obligations](index=37&type=section&id=Contractual%20Commitments%20and%20Obligations) Climb Bio has office lease obligations and contingent milestone and royalty payment obligations under asset purchase and license agreements, which are difficult to reliably estimate - The company has a lease agreement for office space with remaining fixed payments of **$0.4 million** through December 2026, and an option to extend for an additional **$0.3 million** through December 2027[139](index=139&type=chunk) - Obligations under asset purchase and license agreements for milestone and royalty payments are contingent upon future events (e.g., development, regulatory, commercial milestones, product sales) and cannot be reliably estimated for timing or likelihood[140](index=140&type=chunk) [Critical Accounting Policies and Estimates](index=37&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Climb Bio's financial statements require management estimates and assumptions, with no material changes to critical accounting policies reported during Q2 or H1 2025 - The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts and disclosures[141](index=141&type=chunk) - There were no material changes to the company's critical accounting policies during the three or six months ended June 30, 2025[142](index=142&type=chunk) [Recently Issued Accounting Pronouncements Not Yet Adopted](index=37&type=section&id=Recently%20Issued%20Accounting%20Pronouncements%20Not%20Yet%20Adopted) This section refers to Note 2 of the condensed consolidated financial statements for details on recently issued accounting pronouncements not yet adopted - Information regarding recently issued accounting pronouncements not yet adopted is provided in Note 2 to the unaudited condensed consolidated financial statements[143](index=143&type=chunk) [Emerging Growth Company Status](index=37&type=section&id=Emerging%20Growth%20Company%20Status) Climb Bio is an "emerging growth company" and "smaller reporting company" under the JOBS Act, allowing reduced reporting requirements until December 31, 2026, or earlier if financial thresholds are met - The company is an "emerging growth company" and a "smaller reporting company" as defined in the JOBS Act and Exchange Act, respectively[144](index=144&type=chunk) - This status allows the company to take advantage of exemptions from various reporting requirements, including the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act[144](index=144&type=chunk) - The company could remain an "emerging growth company" until December 31, 2026, or earlier if its aggregate market value of common stock held by non-affiliates exceeds **$700 million**[144](index=144&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Climb Bio, Inc. is not required to provide quantitative and qualitative disclosures about market risk - The company is not required to provide quantitative and qualitative disclosures about market risk due to its status as a smaller reporting company[145](index=145&type=chunk) [Item 4. Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded Climb Bio's disclosure controls were ineffective as of June 30, 2025, due to material weaknesses in internal control over financial reporting, with remediation efforts underway - Management concluded that disclosure controls and procedures were not effective as of June 30, 2025, due to material weaknesses in internal control over financial reporting[147](index=147&type=chunk) - Identified material weaknesses include a lack of sufficient professionals with appropriate accounting knowledge and experience, and a lack of formal accounting policies, procedures, and controls[152](index=152&type=chunk) - Remediation efforts include hiring qualified personnel, designing and implementing improved policies and controls, and implementing financial systems to enhance segregation of duties and data reliability[153](index=153&type=chunk)[154](index=154&type=chunk) - Despite the material weaknesses, management believes the unaudited condensed consolidated financial statements fairly present the company's financial condition, results of operations, and cash flows[148](index=148&type=chunk) [Material Weaknesses in Internal Control Over Financial Reporting](index=38&type=section&id=Material%20Weaknesses%20in%20Internal%20Control%20Over%20Financial%20Reporting) Climb Bio identified material weaknesses in internal control over financial reporting due to insufficient accounting personnel and a lack of formally designed policies and controls - Material weaknesses were identified due to a lack of sufficient professionals with appropriate accounting knowledge, training, and experience[152](index=152&type=chunk) - The company also lacked formally designed and maintained accounting policies, procedures, and controls for complete, accurate, and timely financial accounting, reporting, and disclosures, including segregation of duties[152](index=152&type=chunk) - These material weaknesses could result in a material misstatement of account balances or disclosures in annual or interim consolidated financial statements[150](index=150&type=chunk) [Remediation Efforts to Address Material Weaknesses](index=38&type=section&id=Remediation%20Efforts%20to%20Address%20Material%20Weaknesses) Remediation efforts include hiring qualified personnel, implementing improved policies and controls, formalizing procedures for complex transactions, and enhancing financial systems, with substantial progress reported - Remediation efforts include hiring qualified personnel with appropriate expertise and implementing improved policies, processes, and internal controls, including senior management review and audit committee oversight[153](index=153&type=chunk) - The company has formalized policies and controls to identify and assess complex accounting transactions and implemented financial systems to improve segregation of duties and data reliability[153](index=153&type=chunk)[154](index=154&type=chunk) - Substantial progress has been made, but the effectiveness of these remediation steps will be concluded upon completion of efforts and subsequent evaluation[154](index=154&type=chunk) [Changes in Internal Control over Financial Reporting](index=40&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) No material changes in Climb Bio's 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[155](index=155&type=chunk) [PART II. OTHER INFORMATION](index=41&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section provides other information, including legal proceedings, risk factors, equity sales, defaults, mine safety, and exhibits [Item 1. Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) As of the filing date, Climb Bio, Inc. was not involved in any material legal proceedings - The company is not party to any material legal matters or claims as of the date of filing this Quarterly Report[158](index=158&type=chunk) [Item 1A. Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) This section outlines numerous risks that could materially affect Climb Bio's business, financial condition, and results of operations, spanning financial, development, legal, third-party, IP, operations, and common stock aspects [Risks Related to our Financial Position and Need for Additional Capital](index=41&type=section&id=Risks%20Related%20to%20our%20Financial%20Position%20and%20Need%20for%20Additional%20Capital) Climb Bio has significant losses and an accumulated deficit, requires substantial additional capital for product commercialization, and faces risks of dilution from equity offerings and insufficient funds for contingent obligations - The company has incurred significant operating losses since inception, with an accumulated deficit of **$259.3 million** as of June 30, 2025, and does not expect to generate revenue for the foreseeable future[161](index=161&type=chunk)[162](index=162&type=chunk) - Future success is primarily dependent on regulatory approval and commercialization of product candidates, which will require substantial additional capital[167](index=167&type=chunk) - The company has significant potential future obligations under license agreements (Acelyrin, CRH, ProBioGen, Mabworks) for contingent development, commercial, sales, and regulatory milestones and royalties, which may materially harm development efforts if funds are insufficient[165](index=165&type=chunk)[166](index=166&type=chunk) - Raising additional capital through equity offerings could dilute stockholders' ownership, while debt financing may involve restrictive covenants[170](index=170&type=chunk) [Risks Related to our Business and the Development of our Product Candidates](index=46&type=section&id=Risks%20Related%20to%20our%20Business%20and%20the%20Development%20of%20our%20Product%20Candidates) Climb Bio's success depends on regulatory approval and commercialization of budoprutug and CLYM116, a complex process with uncertain outcomes, facing risks from clinical trial results, adverse events, patient enrollment, intense competition, and FDA disruptions - The company's future success is primarily dependent on the regulatory approval and commercialization of budoprutug and CLYM116, a process that is lengthy, complex, expensive, and uncertain[179](index=179&type=chunk)[210](index=210&type=chunk) - Preliminary, initial, or interim clinical trial results may change as more data become available and are not predictive of final results, potentially harming approval and commercialization efforts[208](index=208&type=chunk)[209](index=209&type=chunk) - Product candidates may cause adverse events or undesirable side effects, leading to clinical trial delays, termination, restrictive labels, or denial of regulatory approval[225](index=225&type=chunk)[226](index=226&type=chunk) - Difficulties in enrolling and retaining patients in clinical trials could result in significant delays, increased costs, or abandonment of development programs[229](index=229&type=chunk)[232](index=232&type=chunk) - The company faces significant competition from major pharmaceutical and biotechnology companies with greater resources and expertise, which could lead to competitors achieving regulatory approval first or developing superior therapies[240](index=240&type=chunk)[245](index=245&type=chunk)[246](index=246&type=chunk) - Disruptions at the FDA and other government agencies (e.g., funding cuts, personnel losses, regulatory reform, government shutdowns) could hinder the ability to obtain guidance and timely approval of product candidates[259](index=259&type=chunk)[260](index=260&type=chunk)[263](index=263&type=chunk) [Risks Related to Legal and Regulatory Compliance](index=65&type=section&id=Risks%20Related%20to%20Legal%20and%20Regulatory%20Compliance) Climb Bio faces risks from evolving healthcare laws (e.g., IRA drug pricing, fraud and abuse, data privacy), which could increase costs, limit market access, or result in penalties, and expedited regulatory pathways do not guarantee faster approval - Enacted and future legislation, such as the Inflation Reduction Act (IRA), may increase the difficulty and cost of obtaining marketing approval, restrict post-approval activities, and affect product pricing and reimbursement[266](index=266&type=chunk)[270](index=270&type=chunk)[271](index=271&type=chunk) - The IRA's Medicare drug price negotiation program and inflation rebates could limit the expected return on product candidates and the full value of patents[271](index=271&type=chunk)[273](index=273&type=chunk)[277](index=277&type=chunk) - Business operations are subject to federal and state healthcare fraud and abuse laws (e.g., Anti-Kickback Statute, False Claims Act, HIPAA), with non-compliance potentially leading to substantial penalties, exclusion from government programs, and reputational harm[293](index=293&type=chunk)[294](index=294&type=chunk)[298](index=298&type=chunk) - The company is subject to stringent and evolving U.S. and foreign data privacy and security laws (e.g., HIPAA, CCPA, GDPR), with actual or perceived failures leading to regulatory investigations, litigation, fines, and business disruptions[301](index=301&type=chunk)[303](index=303&type=chunk)[307](index=307&type=chunk)[315](index=315&type=chunk)[316](index=316&type=chunk) - While the company may seek expedited designations (Breakthrough Therapy, Fast Track, Priority Review, PRIME), receipt is not guaranteed and does not assure faster development, review, or ultimate approval[318](index=318&type=chunk)[324](index=324&type=chunk)[325](index=325&type=chunk)[326](index=326&type=chunk) - Accelerated approval, if granted, requires post-marketing confirmatory trials and may be withdrawn if predicted clinical benefits are not verified or conditions are not met[329](index=329&type=chunk)[332](index=332&type=chunk)[334](index=334&type=chunk) - Orphan drug designation for budoprutug in pMN may not guarantee market exclusivity or full benefits, as exclusivity can be waived or lost under certain circumstances, and regulations may change[339](index=339&type=chunk)[342](index=342&type=chunk)[343](index=343&type=chunk)[344](index=344&type=chunk)[345](index=345&type=chunk) [Risks Related to our Dependence on Third Parties](index=87&type=section&id=Risks%20Related%20to%20our%20Dependence%20on%20Third%20Parties) Climb Bio heavily relies on third parties for development and manufacturing, facing risks from their failures, supply disruptions, and inability to secure new collaborations, compounded by uncertainties in U.S. and international trade policies, especially with China - The company relies on third-party CROs to conduct, supervise, and monitor preclinical studies and clinical trials, which reduces control over these activities and poses risks if they fail to perform or meet deadlines[365](index=365&type=chunk)[366](index=366&type=chunk)[368](index=368&type=chunk) - Reliance on third-party, including single-source, manufacturers for product candidate materials increases the risk of insufficient quantities, unacceptable costs, or supply disruptions, which could delay development or commercialization[378](index=378&type=chunk)[379](index=379&type=chunk)[386](index=386&type=chunk) - The company is dependent on third parties for raw materials, and loss of key suppliers or supply disruptions could impede development, manufacturing, and marketing efforts[393](index=393&type=chunk)[395](index=395&type=chunk)[396](index=396&type=chunk) - Future product development and commercialization may require additional collaborations, which are competitive and may not be available on acceptable terms, potentially altering development plans[397](index=397&type=chunk)[399](index=399&type=chunk)[402](index=402&type=chunk) - Uncertainty surrounding U.S. and international trade policies, particularly with China (e.g., tariffs, proposed BIOSECURE Act targeting Chinese biotechnology companies), may adversely impact business by disrupting supply chains and restricting partnerships with foreign vendors like WuXi and Mabworks[404](index=404&type=chunk)[406](index=406&type=chunk)[407](index=407&type=chunk)[408](index=408&type=chunk) [Risks Related to Intellectual Property](index=97&type=section&id=Risks%20Related%20to%20Intellectual%20Property) Climb Bio heavily relies on in-licensed IP, facing risks of license termination, patent challenges, and infringement claims, with global protection being expensive and uncertain, and patent terms potentially inadequate - The company heavily relies on patents, know-how, and other intellectual property licensed from third parties (e.g., CRH for budoprutug, Mabworks for CLYM116)[411](index=411&type=chunk) - Failure to comply with obligations under license agreements could lead to termination of licenses, loss of important intellectual property rights, and inability to develop or commercialize product candidates[413](index=413&type=chunk) - There is no assurance that current or future patent applications (14 pending U.S. provisional for budoprutug, one in-licensed PCT for CLYM116) will result in issued patents or provide competitive advantage[418](index=418&type=chunk)[420](index=420&type=chunk) - Issued patents may be challenged, invalidated, narrowed, or held unenforceable by third parties, leading to loss of exclusivity or freedom to operate[421](index=421&type=chunk)[426](index=426&type=chunk)[443](index=443&type=chunk) - Reliance on third parties for development and manufacturing increases the risk of trade secret discovery, misappropriation, or unauthorized disclosure, which would harm the company's competitive position[446](index=446&type=chunk)[447](index=447&type=chunk)[449](index=449&type=chunk)[514](index=514&type=chunk)[515](index=515&type=chunk) - The company may become involved in lawsuits to protect or enforce its patents, or face claims of infringing third-party intellectual property rights, which are expensive, time-consuming, and could result in substantial damages or injunctions[450](index=450&type=chunk)[451](index=451&type=chunk)[501](index=501&type=chunk)[502](index=502&type=chunk)[505](index=505&type=chunk)[506](index=506&type=chunk) - Patent terms may be inadequate to protect the company's competitive position for an adequate amount of time due to the lengthy development and regulatory review processes[481](index=481&type=chunk)[483](index=483&type=chunk)[490](index=490&type=chunk) [Risks Related to our Business Operations and Employee Matters](index=118&type=section&id=Risks%20Related%20to%20our%20Business%20Operations%20and%20Employee%20Matters) Climb Bio faces risks from cyberattacks, dependence on key personnel, employee misconduct, international operations, limitations on NOL carryforwards, and challenges associated with growth through acquisitions or investments - Information technology systems and data are vulnerable to cyberattacks, malicious activity, and security incidents, which could lead to unauthorized data access/loss, material disruption of development programs, regulatory investigations, litigation, fines, and reputational harm[526](index=526&type=chunk)[527](index=527&type=chunk)[528](index=528&type=chunk)[533](index=533&type=chunk)[538](index=538&type=chunk)[542](index=542&type=chunk) - The company is highly dependent on attracting and retaining qualified managerial, scientific, and medical personnel; the loss of key individuals could impede development and business plans[545](index=545&type=chunk)[546](index=546&type=chunk) - The company is exposed to the risk of fraudulent conduct or other illegal activity by employees, independent contractors, and third parties, including non-compliance with regulatory standards and healthcare fraud and abuse laws[547](index=547&type=chunk)[548](index=548&type=chunk) - Any international operations expose the company to business, regulatory, political, operational, financial, pricing, and reimbursement risks associated with doing business outside the U.S.[551](index=551&type=chunk) - The company may not be able to fully utilize its net operating loss (NOL) carryforwards due to "ownership change" rules under Sections 382 and 383 of the Internal Revenue Code, potentially increasing future tax obligations[553](index=553&type=chunk)[555](index=555&type=chunk) - Growth through acquisitions or investments (e.g., Tenet acquisition, Mabworks Agreement) involves numerous risks, including integration difficulties, unanticipated costs, diversion of management attention, and potential dilution of stockholders[556](index=556&type=chunk)[558](index=558&type=chunk)[560](index=560&type=chunk) [Risks Related to our Common Stock](index=126&type=section&id=Risks%20Related%20to%20our%20Common%20Stock) Climb Bio's common stock price is volatile, with no anticipated dividends, and faces risks from substantial share sales, anti-takeover provisions, concentrated ownership, material weaknesses in internal controls, and exclusive forum provisions - The trading price of the company's common stock has been volatile and may continue to be influenced by factors such as clinical trial results, regulatory decisions, market conditions, and analyst reports[561](index=561&type=chunk)[563](index=563&type=chunk) - The company does not anticipate paying cash dividends, making capital appreciation the sole source of gain for stockholders in the foreseeable future[565](index=565&type=chunk) - Sales of a substantial number of common shares into the public market, including those from equity compensation plans and private placements, could cause the market price to decline significantly and dilute existing stockholders' ownership[568](index=568&type=chunk)[570](index=570&type=chunk)[571](index=571&type=chunk) - Anti-takeover provisions in charter documents and Delaware law could make an acquisition more difficult and limit attempts by stockholders to replace or remove current management[573](index=573&type=chunk)[575](index=575&type=chunk) - Concentration of ownership among executive officers, directors, and principal stockholders (e.g., RA Capital Management L.P. with **46.4%**) may limit new investors' influence and reduce the public float, potentially depressing the stock price[580](index=580&type=chunk)[581](index=581&type=chunk) - Identified material weaknesses in internal control over financial reporting, if not remediated, could impair the ability to produce accurate financial statements and adversely affect the business and stock price[582](index=582&type=chunk)[585](index=585&type=chunk)[587](index=587&type=chunk) - Exclusive forum provisions in the amended certificate of incorporation designate specific judicial forums for disputes, potentially restricting stockholders' ability to choose a favorable forum and increasing litigation costs[588](index=588&type=chunk)[589](index=589&type=chunk)[591](index=591&type=chunk) [General Risk Factors](index=133&type=section&id=General%20Risk%20Factors) Climb Bio faces general risks including potential securities litigation, limited equity analyst coverage, unfavorable global economic conditions, and the impact of its "emerging growth company" and "smaller reporting company" status on investor attractiveness - The company may become involved in securities litigation or stockholder derivative litigation, which is expensive and diverts management's attention and resources[593](index=593&type=chunk)[595](index=595&type=chunk) - Limited equity analyst coverage may adversely affect the market price and trading volume of the common stock[596](index=596&type=chunk)[597](index=597&type=chunk) - Unfavorable global economic conditions, including volatility, inflation, and geopolitical events, could adversely affect the business, financial condition, and ability to raise additional capital[598](index=598&type=chunk)[599](index=599&type=chunk)[601](index=601&type=chunk) - Being an "emerging growth company" and "smaller reporting company" allows for reduced reporting requirements, which may make the common stock less attractive to some investors, potentially leading to less active trading and more volatile prices[602](index=602&type=chunk)[603](index=603&type=chunk) - Changes in tax laws or regulations, such as the OECD Pillar Two rules, could adversely affect the company's domestic and international business operations and financial performance[605](index=605&type=chunk)[606](index=606&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=136&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Climb Bio, Inc. reported no unregistered sales of equity securities or use of proceeds during the period covered by this Quarterly Report - No unregistered sales of equity securities or use of proceeds were reported for the period[607](index=607&type=chunk) [Item 3. Defaults Upon Senior Securities](index=136&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to Climb Bio, Inc. for the current reporting period - This item is not applicable[608](index=608&type=chunk) [Item 4. Mine Safety Disclosures](index=136&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Climb Bio, Inc. for the current reporting period - This item is not applicable[609](index=609&type=chunk) [Item 5. Other Information](index=136&type=section&id=Item%205.%20Other%20Information) No Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted or terminated by directors or officers during Q2 2025 - No Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements were adopted or terminated by directors or officers during the three months ended June 30, 2025[610](index=610&type=chunk) [Item 6. Exhibits](index=137&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the Form 10-Q, including key agreements, certifications from executive officers, and XBRL documents - Exhibits include the Agreement and Plan of Merger and Reorganization, an Offer Letter, a Separation and Release of Claims Agreement, certifications of principal executive and financial officers, and Inline XBRL documents[613](index=613&type=chunk) [Signatures](index=138&type=section&id=Signatures) The Quarterly Report on Form 10-Q is signed by Climb Bio's President and CEO, Aoife Brennan, and SVP of Finance, Cindy Driscoll, on August 12, 2025 - The report is signed by Aoife Brennan, President and Chief Executive Officer (Principal Executive Officer), and Cindy Driscoll, Senior Vice President, Finance (Principal Financial Officer)[618](index=618&type=chunk) - The signing date for the report is August 12, 2025[618](index=618&type=chunk)

Exhibit 99.1 TScan Therapeutics Reports Second Quarter 2025 Financial Results and Provides Corporate Update Two-year relapse data from ALLOHA™ Phase 1 heme trial to be presented by end of year Expects to dose first solid tumor patients with multiplex TCR-T in the third quarter of 2025 Cash, cash equivalents, and marketable securities continue to fund operations into the first quarter of 2027 WALTHAM, Mass., Aug 12, 2025 -- TScan Therapeutics, Inc. (Nasdaq: TCRX), a clinical-stage biotechnology company focus ...