FTH 10-K & 10-Q changes, risk factors and insider trading
Faeth Therapeutics, Inc. · Nasdaq · Pharmaceutical Preparations · CIK 1829802 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “We will need substantial additional funding to complete the development of our product candidates. A failure to obtain this necessary capital when needed could force us to delay, limit, reduce or terminate our product development or commercialization efforts.”
New heading “While emerging clinical data from third parties has provided evidence supporting the multi-node inhibition concept for the PI3K/AKT/mTOR pathway, there is no guarantee that PIKTOR’s specific approach will produce comparable clinical results, and earlier approvals for third party drugs in this class could limit our commercial opportunity.”
New heading “Negative outcomes or data integrity failures by competitors in the oncology space could adversely affect our business, reputation, and the regulatory and commercial environment in which we operate.”
New heading “We were not involved in the early development of PIKTOR; therefore, we are dependent on third parties having accurately generated, collected, interpreted and reported data from certain preclinical and clinical trials of PIKTOR.”
New heading “The cross-trial comparisons we present regarding PIKTOR’s safety and efficacy profile relative to other PI3K/AKT/mTOR pathway agents are subject to significant limitations and may not be predictive of PIKTOR’s relative performance in future controlled studies.”
New heading “Our projections of addressable market opportunity for PIKTOR are based on estimates and assumptions that may prove incorrect, and the actual commercial opportunity may be substantially smaller than we expect.”
New heading “Our business, operational and financial goals may not be attainable if the market opportunities for our products are smaller than we expect. Our internal research and third-party estimates may not accurately reflect the market opportunities for PIKTOR or our other product candidates today or in the future.”
New heading “If we are unable to obtain and maintain effective patent protection for our technology and product candidates, or if the scope of the patent protection obtained is not sufficiently broad, we may not be able to compete effectively in our markets”
New heading “We may not identify relevant patents or may incorrectly interpret the relevance, scope or expiration of a patent, which might adversely affect our ability to develop and market our products.”
New heading “Changes in U.S. patent law or the patent law of other countries or jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our product candidates.”
New heading “Third-party claims or litigation alleging infringement of patents or other proprietary rights, or seeking to invalidate our patents or other proprietary rights, may delay or prevent our development and commercialization efforts.”
New heading “We may develop or license intellectual property for which development was funded or otherwise assisted by, the U.S. government and/or government agencies, such as the National Institutes of Health, for development of our technology and product candidates. Failure to meet our own obligations to future licensors or upstream licensors, including such government agencies, may result in the loss of our rights to such intellectual property, which could harm our business.”
New heading “We may become involved in lawsuits to protect or enforce our patents, the patents of our licensors or our other intellectual property rights, which could be expensive, time-consuming and unsuccessful.”
New heading “We may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed confidential information of third parties or that our employees have wrongfully used or disclosed alleged trade secrets of their former employers.”
New heading “If we fail to comply with our obligations in the agreements under which we license intellectual property and other rights from third parties or otherwise experience disruptions to our business relationships with our licensors, we could lose license rights that are important to our business.”
New heading “We may be subject to claims challenging the inventorship of our patent filings and other intellectual property.”
New heading “Our reliance on third parties requires us to share our trade secrets, which increases the possibility that a competitor will discover them or that our trade secrets will be misappropriated or disclosed.”
New heading “We may not be able to protect our intellectual property rights throughout the world, which could impair our business.”
New heading “Obtaining and maintaining our patent protection depends on compliance with various procedural requirements, document submissions, fee payment and other requirements imposed by governmental patent agencies. Our patent protection could be reduced or eliminated for non-compliance with these requirements.”
New heading “We will be required to expand our development and regulatory capabilities and potentially implement sales, marketing and distribution capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations.”
New heading “Following the Acquisition, certain of our employees who previously worked at a private company are now subject to public company compliance obligations, and any failure to comply with these obligations could expose us to regulatory risk and reputational harm.”
New heading “Changes in tax law could adversely affect our business and financial condition.”
New heading “Risks Related to the Acquisition”
New heading “Pursuant to the terms of the Acquisition, we are required to recommend that our stockholders approve the conversion of all outstanding shares of our Series B preferred stock into shares of our common stock. We must also obtain stockholder approval of an amendment to our certificate of incorporation to increase the number of shares we are authorized to issue. We cannot guarantee that our stockholders will approve these matters, and if they fail to do so we may be required to settle such shares in cash and our operations may be materially harmed.”
New heading “Failure to obtain approval of the Nasdaq Listing Application could materially affect our results of operations, business and financial condition.”
New heading “There is no guarantee that the Acquisition will increase stockholder value.”
New heading “The failure to successfully integrate the businesses of the Company and Faeth Therapeutics in the expected timeframe could adversely affect our results of operations, financial condition, and future results.”
New heading “We expect to incur substantial expenses related to the integration of Faeth.”
Removed heading “Risks Related to our Financial Position”
Removed heading “Risks Related to the Development of our Product Candidates”
Removed heading “Risks Related to our Dependence on Third Parties”
Removed heading “Risks Related to Regulatory Approval of our Product Candidates and Other Legal Compliance Matters”
Removed heading “Risks Related to the Commercialization of our Product Candidates”
Removed heading “Risks Related to our Intellectual Property”
Removed heading “Risks Related to our Business Operations”
Removed heading “Risks Related to our Securities and our Status as a Public Company”
Removed heading “We will need additional funding to complete the development of our product candidates. A failure to obtain this necessary capital when needed could force us to delay, limit, reduce or terminate our product development or commercialization efforts.”
Removed heading “The therapeutic efficacy of our product candidates, including solnerstotug, is unproven in humans, and we may not be able to successfully develop and commercialize drug candidates pursuant to these programs.”
Removed heading “We have entered, and may in the future enter into, partnership agreements with third parties for the development and commercialization of our product candidates. Our prospects with respect to those product candidates will depend in significant part on the success of those collaborations.”
Removed heading “If we are unable to obtain and maintain patent protection for our technologies and product candidates, including solnerstotug, or if the scope of the patent protection obtained is not sufficiently broad, our competitors could develop and commercialize technology and biologics similar or identical to ours, and our ability to successfully commercialize our technology and product candidates may be impaired.”
Removed heading “Third parties may initiate legal proceedings alleging that we are infringing their intellectual property rights, the outcome of which would be uncertain and could significantly harm our business.”
Removed heading “We may become involved in lawsuits to protect or enforce our intellectual property, which could be expensive, time-consuming and unsuccessful.”
Removed heading “We may be subject to claims by third parties asserting that we or our employees have misappropriated their intellectual property, or claiming ownership of what we regard as our own intellectual property.”
Removed heading “We may be subject to claims challenging the inventorship or ownership of our owned patent rights and other intellectual property.”
Removed heading “If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed.”
Removed heading “We may not be able to protect our intellectual property rights throughout the world.”
Removed heading “Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.”
Removed heading “We will need to grow the size of our organization, and we may experience difficulties in managing this growth.”
Removed heading “Our workforce reduction may not achieve our intended outcomes.”
Removed heading “An active trading market for our common stock may not continue to develop or be sustained.”
Removed heading “If we fail to meet all applicable Nasdaq listing requirements and Nasdaq determines to delist our common shares, the delisting could adversely affect the market liquidity of our common shares and the market price of our common shares could decrease.”
Largest changes
“We increasingly use artificial intelligence and machine learning tools across our operations and business functions, and we expect our use of such tools to expand over time. While we believe that the responsible use of AI tools can enhance our operational efficiency, these tools present risks that could adversely affect our business. AI-generated outputs may be inaccurate, incomplete, or misleading, and reliance on such outputs without adequate human oversight could result in errors in regulatory submissions, clinical or scientific analyses, contractual provisions, or public disclosures. …”see in full comparison
“Additionally, the U.S. Department of Justice issued a rule entitled Preventing Access to U.S. Sensitive Personal Data and Government-Related Data by Countries of Concern or Covered Persons, which places additional restrictions on certain data transactions involving countries of concern (e.g., China, Russia, Iran) and covered persons (i.e., individuals and entities who are designated as such by the U.S. …”see in full comparison
“If we fail to meet all applicable Nasdaq listing requirements and Nasdaq determines to delist our common shares, the delisting could adversely affect the market liquidity of our common shares and the market price of our common shares could decrease.”see in full comparison
“Our employees and personnel use generative artificial intelligence (“AI”) technologies to perform their work, and the disclosure and use of personal data in generative AI technologies is subject to various privacy laws and other privacy obligations. Governments have passed and are likely to pass additional laws regulating generative AI. Our use of this technology could result in additional compliance costs, regulatory investigations and actions, and lawsuits. If we are unable to use generative AI, it could make our business less efficient and result in competitive disadvantages.”see in full comparison
“The General Data Protection Regulation, the GDPR, applies in the European Economic Area, the EEA, into which we may expand our business. The GDPR governs the collection, use, disclosure, transfer or other processing of personal data of European data subjects. …”see in full comparison
“We maintain sensitive information, including confidential business and personal information in connection with our preclinical studies and our employees, and are subject to laws and regulations governing the privacy and security of such information. In the United States, there are numerous federal and state privacy and data security laws and regulations governing the collection, use, disclosure and protection of personal information, including federal and state health information privacy laws, federal and state security breach notification laws, and federal and state consumer protection laws. …”see in full comparison
Full comparison: every changed paragraph (337)
We have a limited operating history, have incurred net losses since our inception, and anticipate that we will incur significant losses for the foreseeable future. We may never generate any revenue or become profitable or, if we achieve profitability, may not be able to sustain it.
Risks Related to our Financial Position
WeIf willwe needare additional fundingunable to completeraise the development of our product candidates. A failure to obtain this necessaryadditional capital when neededneeded, couldwe forcemay usbe forced to delay, limit, reduce or terminateeliminate our product development programs or commercializationother efforts.operations.
We need substantial additional funding to complete the development of our product candidates. A failure to obtain this necessary capital when needed could force us to further delay, limit, reduce or terminate our product development or commercialization efforts.
Risks Related to the Development of our Product Candidates
We were not involved in the early development of PIKTOR; therefore, we are dependent on third parties having accurately generated, collected, interpreted and reported data from certain preclinical and clinical trials of PIKTOR.
While emerging clinical data from a competitor has provided evidence supporting the multi-node inhibition concept, there is no guarantee that PIKTOR’s specific approach will produce comparable results, and a competitor’s first-mover advantage could limit our commercial opportunity.
Risks Related to our Dependence on Third Parties
We collaborate with third parties in connection with the development of our product candidates, and may depend upon future collaboration partners to commit to the research, development, manufacturing and marketing of our product candidates.
Risks Related to Regulatory Approval of our Product Candidates and Other Legal Compliance Matters
Healthcare legislative reform measures may have a material adverse effect on our business and results of operations.
Risks Related to the Commercialization of our Product Candidates
The success of our product candidates will depend on several factors, including obtaining and maintaining patent and trade secret protection and/or regulatory exclusivity for our product candidates.
Risks Related to our Intellectual Property
If we are unable to obtain and maintain patent protection for our technologies and product candidates, including solnerstotug, or if the scope of the patent protection obtained is not sufficiently broad, our competitors could develop and commercialize technology and biologicsproducts similar or identical to ours, and our ability to successfully commercialize our technology and product candidates may be impaired.
There is no guarantee that the Acquisition will increase stockholder value.
Pursuant to the terms of the Acquisition and related 2026 Private Placement, we are required to recommend that our stockholders approve the conversion of all outstanding shares of our Series B Preferred Stock into shares of our common stock. We must also obtain stockholder approval of an amendment to our certificate of incorporation to increase the number of shares we are authorized to issue. We cannot guarantee that our stockholders will approve these matters, and if they fail to do so we may be required to settle such shares in cash and our operations would be materially harmed.
The failure to successfully integrate the businesses of Sensei and Faeth in the expected timeframe could adversely affect our results of operations, financial condition, and future results.
Risks Related to our Business Operations
We will need to grow the size of our organization, and we may experience difficulties in managing this growth.
Our future success depends on our ability to retain key members of senior management and to attract, retain and motivate qualified personnel.
Risks Related to our Securities and our Status as a Public Company
The trading price of our common stock may be volatile, and you could lose all or part of your investment.
Our business and operations could be negatively affected by any securities litigation or shareholder activism, which could cause us to incur significant expense, hinder execution of business and growth strategies and impact our share price.
If we fail to maintain an effective system of internal control over financial reporting which results in material weaknesses, we may be unable to accurately report our results of operations, meet our reporting obligations or prevent fraud and investor confidence in our company and the market price of our common stock may be materially and adversely affected.
We will need additional funding to complete the development of our product candidates. A failure to obtain this necessary capital when needed could force us to delay, limit, reduce or terminate our product development or commercialization efforts.
We will require substantial additional funding to meet our financial needs and to pursue our business objectives. If we are unable to raise capital when needed, we could be forced to delay, reduce or altogether cease our product development programs or commercialization efforts.
Our future capital requirements will depend on many factors, including:
the scope, progress, results and costs of discovery, laboratory testing, manufacturing, preclinical and clinical development of our current and future product candidates;
the timing and amounts of any milestone or royalty payments we may be required to make or may be entitled to receive under license agreements;
the costs of building out our infrastructure including hiring additional clinical, quality control and manufacturing personnel;
the costs, timing and outcome of regulatory review of our product candidates;
the costs and timing of future commercialization activities, including product manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval;
the revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval;
the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims;
the costs of operating as a public company; and the extent to which we acquire or in-license other product candidates and technologies.
To date, we have primarily financed our operations through the sale of equity securities. We may seek to raise any necessary additional capital through a combination of public or private equity offerings, debt financings, collaborations, strategic alliances, licensing arrangements and other marketing and distribution arrangements. We cannot assure you that we will be successful in acquiring additional funding at levels sufficient to fund our operations or on terms favorable to us. While the long-term economic impact of each of the conflicts in Ukraine and the Middle East and recent and potential future disruptions in access to bank deposits or lending commitments due to bank failures are difficult to assess or predict, each of these events has caused significant disruptions to the global financial markets and contributed to a general global economic slowdown. Furthermore, inflation rates, particularly in the United States and the U.K., recently increased to levels not seen in decades. While such rates have begun to decline, increased inflation may result in increased operating costs (including labor costs) and may affect our operating budgets. In addition, the U.S. Federal Reserve has raised, and may in the future further raise, interest rates in response to concerns about inflation. Increases in interest rates, especially if coupled with reduced government spending and volatility in financial markets, may further increase economic uncertainty and heighten these risks. If the disruptions and slowdown deepen or persist, we may not be able to access additional capital on favorable terms, or at all, which could in the future negatively affect our financial condition and our ability to pursue our business strategy.
We cannot be certain that additional funding will be available on acceptable terms, or at all. If we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we may have to significantly delay, scale back or discontinue the development or commercialization of our product candidates or other research and development initiatives. Any of our current or future license agreements may also be terminated if we are unable to meet the payment or other obligations under the agreements.
We expect that significant additional capital may be needed in the future to continue our planned operations, including conducting clinical trials, commercialization efforts, expanded research and development activities and costs associated with operating a public company. For example, although we have disclosed plans to initiate a Phase 2 clinical trial of solnerstotug in the first quarter of 2026, those plans are contingent upon our ability to raise sufficient additional capital. Until such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through any or a combination of securities offerings, debt financings, license and collaboration agreements and research grants. If we raise capital through securities offerings, such sales are likely to result in material dilution to our existing stockholders, and new investors could gain rights, preferences and privileges senior to the holders of our common stock.
In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe that we have sufficient funds for our current or future operating plans. If we raise additional funds through collaboration and licensing arrangements with third parties, we may have to relinquish some rights to our technologies or our product candidates on terms that are not favorable to us. Any additional capital raising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to develop and commercialize our current and future product candidates, if approved. If we are unable to raise capital when needed or on attractive terms, we could be forced to delay, reduce or altogether cease our research and development programs or future commercialization efforts.
We have a limited operating history and have incurred significant losses in every year since our inception. We expect to continue to incur losses over the next several years and may never achieve or maintain profitability.
We are a clinical-stage biotechnology company with a limited operating history that may make it difficult to evaluate the success of our business to date and to assess the future viability of our business prospects. Our operations to date have been limited to business planning, including the Acquisition, organizing and staffing our company, raising capital, identifying potential product candidates, conducting clinical trials and preclinical studies for our development programs, entering into licensing agreements, establishing and enhancing our intellectual property portfolio, and providing general and administrative support for these operations.
We have no products approved for commercial sale, have not generated any revenue from commercial sales of our product candidates, and are devoting substantially all of our financial resources and efforts to the research and development of solnerstotug and our TMAb platform.PIKTOR. Investment in therapeuticclinical product development is highly speculative because it entails substantial upfront capital expenditures and significant risk that any potential product candidate will fail to demonstrate adequate effect or an acceptable safety profile, gain regulatory approval and/or become commercially viable.
We expect that it will take at least several years until any of our product candidates receive marketing approval and are commercialized, and we may never be successful in obtaining marketing approval and commercializing product candidates. We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future. These net losses will adversely impact our stockholders’ equity and net assets and may fluctuate significantly from quarter to quarter and year to year. We anticipate that our expenses will increase substantially as we:
prepare to file INDs, initiate clinical trials and progress clinical development of our product candidates, including solnerstotug;
invest in our TMAb platform;
seek to discover and develop additional product candidates or acquire or in-license drugs, product candidates or technologies;
seek regulatory approvals for any product candidates that successfully complete clinical trials;
ultimately establish a sales, marketing and distribution infrastructure and scale up manufacturing capabilities to commercialize any product candidates for which we may obtain regulatory approval;
secure the clinical and commercial supply of our product candidates;
hire additional research and development and selling, general and administrative personnel;
maintain, expand and protect our intellectual property portfolio; and incur additional costs associated with operating as a public company.
Because of the numerous risks and uncertainties associated with the development and commercialization of therapeutic product candidates, we are unable to accurately predict the timing or amount of expenses or when, or if, we will be able to achieve and maintain profitability. If we are required by regulatory authorities to perform studies in addition to those currently expected, or if there are any delays in the initiation and completion of our clinical trials or the development of any of our product candidates, our expenses could increase and profitability could be further delayed.
As an organization, we have not demonstrated an ability to successfully complete clinical trials, obtain regulatory approvals, manufacture our product candidates at commercial scale or arrange for a third party to do so on our behalf, conduct sales and marketing activities necessary for successful commercialization, or obtain reimbursement in the countries of sale. We may encounter unforeseen expenses, difficulties, complications, and delays in achieving our business objectives. Our operating history makes any assessment of our future success or viability subject to significant uncertainty.uncertainty, particularly with respect to the Acquisition. If we do not address these risks successfully or are unable to transition at some point from a company with a research and development focus to a company capable of supporting commercial activities, then our business will suffer.
We will need substantial additional funding to complete the development of our product candidates. A failure to obtain this necessary capital when needed could force us to delay, limit, reduce or terminate our product development or commercialization efforts.
Since our inception, we have used substantial amounts of capital to fund the development of our product candidates and operations. We expect our research and development expenses to increase in connection with our ongoing activities, particularly as our product candidates enter and advance through preclinical studies and clinical trials. We will require substantial additional funding to meet our financial needs and to pursue our business objectives. We will require significant additional capital to, among other things:
complete our ongoing and planned clinical trials, preclinical studies and IND-enabling activities;
initiate, enroll, and complete additional clinical trials for our product candidates;
seek and obtain regulatory approvals for our product candidates;
build and maintain our manufacturing capabilities or enter into third-party manufacturing arrangements;
Management's Discussion & Analysis (MD&A)
New heading “Unless otherwise indicated, all information in this Annual Report on Form 10-K gives effect to a 1-for-20 reverse stock split of our common stock that became effective on June 16, 2025 (the “Reverse Stock Split”), and all references to historical share and per share amounts give effect to the Reverse Stock Split.”
Largest changes
“Unless otherwise indicated, all information in this Annual Report on Form 10-K gives effect to a 1-for-20 reverse stock split of our common stock that became effective on June 16, 2025 (the “Reverse Stock Split”), and all references to historical share and per share amounts give effect to the Reverse Stock Split.”see in full comparison
“We have incurred significant operating losses since our inception and expect to continue to incur losses for the foreseeable future. Our net loss was $21.1 million and $30.2 million for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, we had an accumulated deficit of $283.1 million and cash, cash equivalents and marketable securities of $21.2 million, which does not include the $200 million in gross proceeds received in the February 2026 Private Placement. …”see in full comparison
“We are a clinical-stage biotechnology company focused on improving outcomes for cancer patients through multi-node inhibition of critical oncogenic pathways. On February 17, 2026, we completed the Acquisition of Faeth Therapeutics, a clinical-stage biotechnology company developing multi-node therapies targeting tumor metabolism and signaling, and received $200 million in gross proceeds from the 2026 Private Placement from a broad syndicate of institutional investors. …”see in full comparison
“Research and development expenses were $11.0 million for the year ended December 31, 2025, compared to $18.6 million for the year ended December 31, 2024. …”see in full comparison
“We are a clinical-stage biotechnology company focused on the discovery and development of next-generation therapeutics for cancer patients. Through our TMAb™ (Tumor Microenvironment Activated Biologics) platform, we are developing highly selective therapeutics designed to disable immunosuppressive signals or activate immunostimulatory signals selectively in the tumor microenvironment. Our strategy is to generate novel product candidates that incorporate next-generation technologies or approaches. …”see in full comparison
“Research and development expenses were $18.6 million for the year ended December 31, 2024, compared to $18.3 million for the year ended December 31, 2023. …”see in full comparison
Full comparison: every changed paragraph (53)
In this section, we discuss our financial condition, changes in financial condition and results of our operations for the year ended December 31, 2024,2025, compared to the year ended December 31, 2023.2024. For a discussion and analysis comparing our results for the year ended December 31, 2023,2024, to the year ended December 31, 2022,2023, see our Annual Report on Form 10-K for the year ended December 31, 2023,2024, filed with the SEC on FebruaryMarch 29,28, 2024,2025, under Part II, Item 7 "“Management’s Discussion and Analysis of Financial Condition and Results of Operations."”
Unless otherwise indicated, all information in this Annual Report on Form 10-K gives effect to a 1-for-20 reverse stock split of our common stock that became effective on June 16, 2025 (the “Reverse Stock Split”), and all references to historical share and per share amounts give effect to the Reverse Stock Split.
We are a clinical-stage biotechnology company focused on improving outcomes for cancer patients through multi-node inhibition of critical oncogenic pathways. On February 17, 2026, we completed the Acquisition of Faeth Therapeutics, a clinical-stage biotechnology company developing multi-node therapies targeting tumor metabolism and signaling, and received $200 million in gross proceeds from the 2026 Private Placement from a broad syndicate of institutional investors. The acquisition brought Faeth's lead asset, PIKTOR, a proprietary investigational all-oral combination of serabelisib and sapanisertib that inhibits multiple nodes of the PI3K/AKT/mTOR pathway, into our pipeline. Because the Acquisition and 2026 Private Placement closed subsequent to the balance sheet date, the consolidated financial statements included in this Report reflect only the pre-acquisition operations of Sensei Biotherapeutics. For additional information regarding the terms of the acquisition and the concurrent financing, see Note 15 to the consolidated financial statements.
Following the acquisition, our lead program is PIKTOR, an oral multi-node inhibitor of the PI3K/AKT/mTOR pathway in development for endometrial and breast cancer. The PI3K/AKT/mTOR pathway is dysregulated in up to 50% of all solid tumors, making it one of the most prevalent therapeutic targets in oncology. Our core thesis is that simultaneously suppressing multiple pathway nodes can produce deeper, more durable tumor suppression than approved therapies that target only a single node. PIKTOR is currently being evaluated in an ongoing Phase 2 trial in second-line advanced endometrial cancer (Study FTH-PIK-201), with topline data anticipated by year-end 2026, and we intend to initiate a Phase 1b trial in HR+/HER2- advanced breast cancer (Study FTH-PIK-101) by the first half of 2026. We believe the $200 million in financing proceeds, together with our existing cash and cash equivalents, will be sufficient to fund operations through these key clinical milestones.
Prior to the Acquisition, we were primarily focused on the development of solnerstotug (formerly SNS-101), our conditionally active monoclonal antibody targeting the immune checkpoint VISTA. In November 2025, our Board of Directors approved a reduction in force of approximately 65% of our pre-acquisition workforce, referred to herein as the 2025 Restructuring, to preserve capital while we evaluated strategic alternatives, including the Acquisition. We are completing the remaining portions of the solnerstotug Phase 1/2 trial with patients currently on study.
We have incurred significant operating losses since our inception and expect to continue to incur losses for the foreseeable future. Our net loss was $21.1 million and $30.2 million for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, we had an accumulated deficit of $283.1 million and cash, cash equivalents and marketable securities of $21.2 million, which does not include the $200 million in gross proceeds received in the February 2026 Private Placement. The decrease in our net loss in 2025 was primarily attributable to reduced research and development spending resulting from the wind-down of our legacy programs, together with the 2024 Restructuring and the 2025 Restructuring. We expect our research and development expenses to increase significantly in future periods as we advance the clinical development of PIKTOR and other candidates acquired in the Acquisition. We also expect to incur increased general and administrative expenses related to the integration of Faeth's operations and the support of our expanded product pipeline. We have not generated any product revenue and do not expect to do so for the foreseeable future, if ever.
We are a clinical-stage biotechnology company focused on the discovery and development of next-generation therapeutics for cancer patients. Through our TMAb™ (Tumor Microenvironment Activated Biologics) platform, we are developing highly selective therapeutics designed to disable immunosuppressive signals or activate immunostimulatory signals selectively in the tumor microenvironment. Our strategy is to generate novel product candidates that incorporate next-generation technologies or approaches. We plan to efficiently develop these product candidates by incorporating state-of-the-art biomarker approaches and mechanistic understanding into clinical trial designs targeted to well-defined patient populations.
We currently have one investigational product candidate, solnerstotug, in clinical development, and three preclinical product candidates.
Solnerstotug (formerly referred to as SNS-101) is our conditionally active monoclonal antibody targeting the immune checkpoint VISTA (V-domain Ig suppressor of T-cell activation).
In May 2023, we initiated a first-in-human Phase 1/2 open-label, multi-center, dose escalation and expansion trial to evaluate the safety, tolerability, pharmacokinetics, pharmacodynamics and efficacy of solnerstotug as monotherapy and/or in combination with cemiplimab in patients with advanced solid tumors.
As of March 17, 2025 an aggregate of 94 patients have been dosed in the Phase 1 portion of the clinical trial, consisting of 34 patients in the dose escalation cohort and 60 patients in the dose expansion cohort.
On March 27, 2025, we disclosed clinical data from the dose expansion portion of the clinical trial.
Subject to our ability to raise sufficient additional capital, we are planning to initiate a Phase 2 trial of solnerstotug in the first quarter of 2026, with the trial design and patient selection strategies to be informed by the ongoing dose expansion results.
SNS-102 is our conditionally active monoclonal antibody targeting VSIG4 (V-Set and Immunoglobulin Domain Containing 4), an immune checkpoint often expressed on macrophages.
SNS-103 is our conditionally active monoclonal antibody targeting ENTPDase1 (ecto-nucleoside triphosphate diphosphohydrolase-1), also known as CD39.
SNS-201 is a bispecific antibody that is being designed to conditionally activate Cluster of Differentiation 28 (CD28). It is a bispecific format with monovalent CD28 engagement and bivalent pH-selective VISTA binding for efficient engagement at low pH.
In November 2024, we announced a plan to decrease operating expenses, streamline operations and focus resources on advancing the clinical development of solnerstotug. As a result, we closed our research site in Rockville, Maryland, reduced our workforce by approximately 46%, with most headcount reductions affecting our preclinical research and development group, and paused further development of our preclinical product candidates, including SNS-102, SNS-103 and SNS-201. With this realignment of resources, we expect our existing cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements into the second quarter of 2026. We plan to continue reviewing our financial resources with the expectation that work on our preclinical product candidates will resume if we raise sufficient additional capital.
We do not have any product candidates approved for sale, have not generated any revenue from product sales, and do not expect to generate any revenue from product sales for at least the next several years. We have largely funded our operations with proceeds from the sale of convertible preferred stock, common stock and convertible debt. Through the date of this Report, we have raised an aggregate of $123.4 million of gross proceeds from private placements of our equity and convertible debt securities and net proceeds of $138.5 million from our initial public offering, or IPO, in February 2021.
We have incurred significant operating losses over the last several years. Our net loss was $30.2 million and $34.1 million for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, we had an accumulated deficit of $262.1 million. We expect to continue to incur significant expenses and operating losses for the foreseeable future. We anticipate that our expenses will increase significantly in connection with our ongoing activities, as we:
conduct clinical trials of product candidates, including solnerstotug;
invest in our TMAb platform;
seek to discover and develop additional product candidates or acquire or in-license drugs, product candidates or technologies;
seek regulatory approvals for any product candidates that successfully complete clinical trials;
ultimately establish a sales, marketing and distribution infrastructure and scale up manufacturing capabilities to commercialize any product candidates for which we may obtain regulatory approval;
manufacture our product candidates or otherwise secure the clinical and commercial supply of our product candidates;
hire additional research and development and selling, general and administrative personnel;
maintain, expand and protect our intellectual property portfolio; and incur costs associated with operating as a public company.
Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in our accounts payable and accrued expenses. We expect to continue to incur net losses and negative cash flows for the foreseeable future, and we expect our research and development expenses, general and administrative expenses, and capital expenditures will continue to increase. In particular, we expect our expenses to increase as we continue our development of, and seek regulatory approvals for, our product candidates, as well as hire additional personnel, pay fees to outside consultants, lawyers and accountants, and incur other increased costs associated with being a public company. In addition, if we seek and obtain regulatory approval to commercialize any product candidate, we will also incur increased expenses in connection with commercialization and marketing of any such product.
expenses incurred under agreements with contract research organizations, or CROs, as well as investigative sites and consultants that conduct our preclinical studies and clinical trials;
the cost of manufacturing our product candidates including the cost of contract manufacturing organizations, or CMOs,CMOs that manufacture product for use in our preclinical studies and clinical trials and perform analytical testing, scale-up and other services in connection with our development activities;
Our direct external research and development expenses consist primarily of externalthird party costs, such as fees paid to CROs, CMOs, research/testing laboratories and outside consultants in connection with our preclinical development, process development, manufacturing and clinical development activities. We do not allocate these costs to specific product candidates because many of them are deployed across several of our development programs and, as such, are not separately classified. We usehave historically used internal resources primarily to conduct research and manage our preclinical development, process development, manufacturing and clinical development activities. These employees workhave worked across multiple development programs and, therefore, we dohave not trackhistorically tracked their costs by program and, as such, are not separately classified. Research and development activities are central to our business model. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. WeAs a result of the Acquisition in February 2026, we generally expect that our research and development expenses towill increase over the next several years as we conductinitiate ourand advance clinical trials,development prepareof regulatoryPIKTOR filingsand for our productother candidates and have increased costs associated with manufacturing.acquired.
We anticipate that our general and administrative expenses will increase due to costs incurred to integrate Faeth’s operations and to support the expanded product pipeline. These anticipated increases include higher personnel-related costs as we integrate the Faeth team and the ongoing requirements of managing an expanded clinical-stage pipeline.
We anticipate that our general and administrative expenses will decrease slightly due to reduced payroll costs following our November 2024 restructuring. Infrastructure costs are expected to remain consistent, and other expenditures including consulting, legal, tax-related services, accounting, investor relations, and insurance premiums are expected to align with last year's levels.
Our long-lived asset impairments consistconsisted of charges related to the write-down of certain equipment and finance right-of-use assets due to streamlining operations and focusing resources on advancing the clinical development of solnerstotug.our former lead product solnerstotug in 2024. There were no long-lived asset impairment charges recorded during the year ended December 31, 2025.
Our other income (expense) consists of accretion on short-term investments, litigation expense, interest expense and gain or loss on fixed asset disposals.
Research and development expenses were $11.0 million for the year ended December 31, 2025, compared to $18.6 million for the year ended December 31, 2024. The decrease of $7.7 million was primarily attributable to $3.1 million of lower personnel costs, including non-cash stock-based compensation and incentives, $1.4 million of lower facilities and equipment cost, $1.1 million less expense relating to lab supply purchases, $0.9 million of lower expense associated with clinical trials, $0.5 million of lower manufacturing cost, $0.4 million less outside research fees, $0.3 million of lower preclinical research expense and $0.2 million of decreased restructuring costs, partially offset by $0.2 million of higher consulting expense.
Research and development expenses were $18.6 million for the year ended December 31, 2024, compared to $18.3 million for the year ended December 31, 2023. The increase of $0.3 million was primarily attributable to $3.1 million of higher expense associated with clinical trials and $0.8 million of expense related to restructuring costs partially offset by $1.3 million of lower preclinical research expense, $0.9 million less for consulting fees, $0.6 million of lower outside research fees, $0.5 million of lower facilities expense, $0.2 million less expense relating to relating to lab supply purchases and $0.1 million of decreased personnel costs, including stock-based compensation and incentives.
General and administrative expenses were $11.3 million for the year ended December 31, 2025, compared to $13.0 million for the year ended December 31, 2024, compared to $18.8 million for the year ended December 31, 2023.2024. The decrease of $5.7$1.7 million was primarily attributable to $3.0 million of lower costs for external professional services associated with stockholder activism, $1.1 million of lower personnel costs, including recruiting, non-cash stock-based compensation and incentives, $0.9 million less expense for directors and officers insurance, $0.4 million of less external communications expense, $0.3 million of less external administrative fees, $0.2 million decrease related to consulting feesincentives and $0.1 million of lower restructuringboard costs,fees, partially offset by $1.0 million for higher restructuring costs, $0.3 million of higher facilitiesconsulting expense.cost and $0.1 million higher cost for external administrative fees.
Other income was $1.2 million and $2.5 million for the yearyears ended December 31, 20242025 and 2024, respectively, primarily attributable to interest and accretion on investments.
Other income was $3.0 million for the year ended December 31, 2023 primarily attributable to a $3.5 million gain on investments relating to interest and accretion partially offset by a $0.3 million loss on asset disposals and $0.2 million for a legal matter unrelated to core business operations.
Since our inception, we have not generated any product revenue and have incurred net losses and negative cash flows from our operations. As of December 31, 2024,2025, we had cash, cash equivalents and marketable securities of $41.3$21.2 million. We have financed our operations through sales of our common stock, convertible preferred stock and convertible debt. Through the date of this Report, we have raised an aggregate of $123.4 million of gross proceeds from private placements of our equity and convertible debt securities andsecurities, net proceeds of $138.5 million from our IPOinitial public offering in February 2021.2021 and gross proceeds of $200 million from the 2026 Private Placement completed in February 2026. Our net loss was $30.2$21.1 million and $34.1$30.2 million for the years ended December 31, 20242025 and 2023,2024, respectively. As of December 31, 2024,2025, we had an accumulated deficit of $262.1$283.1 million. Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures.
During the year ended December 31, 2025, our operating activities used $20.5 million of cash, resulting from our $21.1 million net loss and a $1.6 million decrease related to changes in our operating assets and liabilities partially offset by increases in non-cash charges of $2.2 million, primarily related to $1.5 million of non-cash lease expense, $1.3 million of stock compensation expense and $0.1 million of depreciation partially offset by $0.7 million of accretion on marketable securities. During the year ended December 31, 2024, our operating activities used $24.7 million of cash, resulting from our $30.2 million net loss and a $0.5 million decrease related to changes in our operating assets and liabilities partially offset by increases in non-cash charges of $6.0 million,million primarily related to $3.1 million of stock compensation expense, $1.6 million of non-cash lease expense, $0.8 million of amortization of financing lease right-of-use assets, $0.6 million for financing right-of-use asset impairments, $0.6 million of depreciation and $0.3 million of loss on fixed asset impairments, partially offset by $1.0 million of accretion on marketable securities. During the year ended December 31, 2023, our operating activities used $32.0 million of cash, resulting from our $34.1 million net loss and a $4.3 million decrease related to changes in our operating assets and liabilities partially offset by increases in non-cash charges of $6.4 million primarily related to $4.5 million of stock compensation expense, $1.4 million of non-cash lease expense, $0.8 million of amortization of financing lease right-of-use assets, $0.6 million of depreciation and $0.3 million of loss on fixed asset disposals, partially offset by $1.1 million of accretion on marketable securities.
During the year ended December 31, 2025, net cash provided by investing activities was $19.8 million, primarily due to $44.7 million in maturities of short-term investments and $0.3 million in proceeds from the sale of property and equipment, partially offset by $25.2 million in purchases of short-term investments. During the year ended December 31, 2024, net cash used in investing activities was $22.4 million primarily due to $67.2 million in maturities of short-term investments partially offset by $44.6 million in purchases of short-term investments and $0.2 million in purchases of property and equipment.
During the year ended December 31, 2024, net cash provided by investing activities was $22.4 million, primarily due to $67.2 million in maturities of short-term investments partially offset by $44.6 million in purchases of short-term investments and $0.2 million in purchases of property and equipment. During the year ended December 31, 2023, net cash used in investing activities was $38.4 million primarily due to $59.6 million in sales and maturities of short-term investments and $0.2 million in proceeds from the sale of property and equipment, partially offset by $21.2 million in purchases of short-term investments and $0.2 million in purchases of property and equipment.
During the year ended December 31, 2025, net cash used in financing activities was $0.6 million, primarily from $0.8 million of principal payments under our financing leases, partially offset by $0.1 million in proceeds from the sale of financing leased assets. During the year ended December 31, 2024, net cash used in financing activities was $0.8 million, consisting of $0.8 million of principal payments under our financing leases.
During the year ended December 31, 2024, net cash used in financing activities was $0.8 million, primarily from $0.8 million of principal payments under our financing leases. During the year ended December 31, 2023, net cash used in financing activities was $11.2 million, primarily from $10.4 million of payments for the repurchase of common stock and $0.8 million of principal payments under our financing leases.
We have operating lease arrangements for our corporate offices, lab facilities and an executive residence. As part of our adoption of Accounting Standards CodificationCodification, (“ASC”)or ASC, 842, we recorded operating right-of-use assets and operating lease liabilities for these agreements. As of December 31, 2024,2025, we had operating lease payment obligations of $3.2$1.5 million, with $1.7$1.4 million payable within twelve months. See Note 6 in our annual financial statements included elsewhere in this Report for additional information.
In addition, our future capital requirements will depend on many factors, including, without limitation, the timing of stockholder approval of the Company Stockholder Matters and the potential cash settlement obligations that may arise if we are unable to timely deliver shares of our common stock upon conversion of the Series B Preferred Stock. In connection with the Acquisition, we issued 24,937.493 shares of Series B Preferred Stock, each share of which is convertible into 1,000 shares of our common stock, subject to certain beneficial ownership limitations and receipt of approval of the Company Stockholder Matters. The shares of Series B Preferred Stock will automatically convert upon the third business day following receipt of approval of the Company Stockholder Matters stockholder approval in accordance with Nasdaq listing rules up to the beneficial ownership limitations set by each holder; provided that such beneficial ownership limitations may be waived by each holder of Series B Preferred Stock at any time following the approval by Nasdaq of the Nasdaq Listing Application and approval of the Company Stockholder Matters.
The Certificate of Designation contains a provision that, at any time following the earlier of (i) approval of the Company Stockholder Matters or (ii) six months after the initial issuance of the Series B Preferred Stock, if we fail to deliver shares of our common stock to a converting holder within the time periods required by the Certificate of Designation, such holder may require us to pay, in lieu of delivering the applicable conversion shares, an amount of cash equal to the fair value of the undelivered shares based on the last reported closing sale price of our common stock on the principal trading market on which our common stock is listed as of the trading day immediately prior to the date on which the applicable notice of conversion was delivered to us. Such payment would be required within two business days of the holder's request.
If we are unable to obtain approval of the Company Stockholder Matters or approval of the Nasdaq Listing Application, or if we are otherwise unable to timely deliver shares of our common stock upon conversion — whether due to an insufficient number of authorized shares, Nasdaq listing requirements, or other factors — we could become obligated to make significant cash settlement payments to holders of Series B Preferred Stock who submit conversion notices after the applicable trigger date. Given the number of shares of Series B Preferred Stock outstanding and the potential magnitude of such cash settlement obligations, which would be determined by reference to the then-current trading price of our common stock, any such payments could require us to use a substantial portion of our available cash resources or to seek additional financing to satisfy these obligations, which could materially limit the amount of cash available to fund our operations and advance our clinical programs.
Additionally, even following stockholder approval of the Company Stockholder Matters, certain holders may be unable to convert their shares of Series B Preferred Stock due to the application of beneficial ownership limitations set by such holder. Shares of Series B Preferred Stock that are not converted in the automatic conversion on account of beneficial ownership limitations will remain outstanding until converted at the option of the applicable holder, and the cash settlement provisions described above would apply to any failure to timely deliver conversion shares in connection with any such optional conversion.
We expect our existing cash and cash equivalentsequivalents, together with the proceeds from the 2026 Private Placement, will enable us to fund our operating expenses and capital expenditure requirements intothrough thetopline seconddata quarterreadouts from both our ongoing Phase 2 trial of 2026.PIKTOR in advanced endometrial cancer (Study FTH-PIK-201) and our planned Phase 1b trial of PIKTOR in HR+/HER2- advanced breast cancer (Study FTH-PIK-101). We have based this estimate on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect. Our future capital requirements will depend on many factors, including:
We qualify as an Emerging Growth CompanyCompany, ("EGC"),or EGC, as defined in the JOBS Act. As an EGC, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies, including reduced disclosure about our executive compensation arrangements, exemption from the requirements to hold non-binding advisory votes on executive compensation and golden parachute payments and exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting.
What changed in the latest 10-Q
Risk Factors
Removed heading “Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern. This conclusion is driven by contingent cash settlement provisions of our Series B Preferred Stock and is not based on insufficiency of our cash resources to fund currently planned operations.”
Removed heading “Pursuant to the terms of the Acquisition, we are required to recommend that our stockholders approve the conversion of all outstanding shares of our Series B preferred stock into shares of our common stock. We must also obtain stockholder approval of an amendment to our certificate of incorporation to increase the number of shares we are authorized to issue. We cannot guarantee that our stockholders will approve these matters, and if they fail to do so we may be required to settle such shares in cash and our operations may be materially harmed.”
Removed heading “Failure to obtain approval of the Nasdaq Listing Application could materially affect our results of operations, business and financial condition.”
Largest changes
“Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern. This conclusion is driven by contingent cash settlement provisions of our Series B Preferred Stock and is not based on insufficiency of our cash resources to fund currently planned operations.”see in full comparison
“Pursuant to the terms of the Acquisition, we are required to recommend that our stockholders approve the conversion of all outstanding shares of our Series B preferred stock into shares of our common stock. We must also obtain stockholder approval of an amendment to our certificate of incorporation to increase the number of shares we are authorized to issue. We cannot guarantee that our stockholders will approve these matters, and if they fail to do so we may be required to settle such shares in cash and our operations may be materially harmed.”see in full comparison
“If we are unable to satisfy any of these conditions or otherwise fail to timely deliver shares of common stock upon conversion, the resulting cash settlement obligations could be substantial and could materially and adversely affect our business, financial condition, results of operations and prospects. …”see in full comparison
“Failure to obtain approval of the Nasdaq Listing Application could materially affect our results of operations, business and financial condition.”see in full comparison
“The audit report of our independent registered public accounting firm accompanying our consolidated financial statements for the year ended December 31, 2025 contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements included in this Quarterly Report continue to reflect that conclusion in Note 1.”see in full comparison
Finally, in connection with the execution of the Agreement and Plan of Merger, or the Merger Agreement, dated as of February 17, 2026, by and among the Company, Sapphire First Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of the Company, Sapphire Second Merger Sub, LLC, a Delaware limited liability company and wholly owned subsidiary of the Company, Faeth Subsidiary and Faeth HoldCo, certain of our directors and officers, as well as certain of the directors, officers and stockholders of Faeth Therapeutics, each as of immediately prior to the Acquisition, entered into lock-up agreements, pursuant to which each such stockholdersee in full comparisonwill beis subject to a 180-day lockup on the sale or transfer of shares of our common stock and Series B Preferred Stock held by each such stockholder, including those shares received by directors and officers in the Acquisition, subject to certain limited exceptions as set forth in such lock-up agreements. Upon expiration of this 180-day lockup period, these shares will become eligible for sale in the public market. Pursuant to the Merger Agreement and the registration rights agreement that we entered into pursuant to the 2026 Private Placement,we are obligated to prepare and filefiled a resale registration statement with the SEC to register the resale of shares of our common stock underlying the Series B Preferred Stock and warrant to purchase shares of Series B PreferredStock.Stock,Weandwillsuchuse commercially reasonable efforts to cause this registration statement to be declared effected by the SEC. Once the registration statement is declared effective, theshares shares subject to the registration statementwillnow no longer constitute restricted securities and may be sold freely in the public markets, subject to(i) the approval of the Company Stockholder Matters (as defined below), (ii) the approval of the Nasdaq Listing Application (as defined below) and (iii)any beneficial ownership limitations set by the holder of Series B Preferred Stock. If our stockholders sell, or indicate an intention to sell, substantial amounts of our common stock in the public market after legal restrictions on resale lapse, the trading price of our common stock could decline.
Full comparison: every changed paragraph (25)
Pursuant to the terms of the Acquisition and related 2026 Private Placement, we are required to recommend that our stockholders approve the conversion of all outstanding shares of our Series B Preferred Stock into shares of our common stock. We must also obtain stockholder approval of an amendment to our certificate of incorporation to increase the number of shares we are authorized to issue. We cannot guarantee that our stockholders will approve these matters, and if they fail to do so we may be required to settle such shares in cash and our operations would be materially harmed.
We have incurred significant operating losses since our inception and expect to continue to incur losses for the foreseeable future. Our net loss was $170.2$186.2 million and $6.9$11.8 million for the threesix months ended MarchJune 31,30, 2026 and 2025, respectively. As of MarchJune 31,30, 2026, we had an accumulated deficit of $453.4$469.4 million and cash, cash equivalents and marketable securities of $202.8$186.4 million, which includes $183.1 million in net proceeds received in the 2026 Private Placement. We have funded our operations to date primarily with proceeds from the sale of our equity securities, including the 2026 Private Placement, and historically from borrowings of convertible debt.
Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern. This conclusion is driven by contingent cash settlement provisions of our Series B Preferred Stock and is not based on insufficiency of our cash resources to fund currently planned operations.
The audit report of our independent registered public accounting firm accompanying our consolidated financial statements for the year ended December 31, 2025 contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements included in this Quarterly Report continue to reflect that conclusion in Note 1.
The substantial doubt conclusion is not based on a determination that our existing cash, cash equivalents and marketable securities — which were $202.8 million as of March 31, 2026 — are insufficient to fund our currently planned operations. Rather, the conclusion is driven by the contingent cash settlement provisions of our Series B Non-Voting Convertible Preferred Stock that we issued in February 2026 in connection with the Acquisition of Faeth Therapeutics and the related 2026 Private Placement.
The Certificate of Designation governing the Series B Preferred Stock provides that, at any time following the earlier of (i) approval of the Company Stockholder Matters or (ii) August 17, 2026 (the date that is six months following the initial issuance of the Series B Preferred Stock), if we fail to deliver shares of common stock to a converting holder within the timeframes required by the Certificate of Designation, the holder may require us to pay cash in lieu of delivering such shares, in an amount equal to the fair value of the undelivered shares determined by reference to our then-current common stock trading price. Because the aggregate magnitude of any such cash settlement obligations would depend on our trading price and the number of conversion notices submitted, such obligations could, in the aggregate, substantially exceed our cash resources.
We have taken the actions we believe are necessary to enable timely delivery of shares of common stock upon conversion of the Series B Preferred Stock. We have called a meeting of our stockholders to be held on June 10, 2026 to vote on the Company Stockholder Matters, including the Charter Amendment Proposal that would increase our authorized common stock to a number sufficient to permit conversion in full of the Series B Preferred Stock, and we have filed our definitive proxy statement in connection with that meeting. We have also filed our Nasdaq Listing Application in connection with the change of control resulting from the Acquisition. However, we cannot guarantee that the Company Stockholder Matters will be approved at the stockholder meeting (or at any subsequent adjournment), that our Nasdaq Listing Application will be conditionally approved, or that we will be able to timely deliver shares of common stock upon any conversion notice — particularly any optional conversion notice submitted by holders subject to beneficial ownership limitations following automatic conversion of other holders' shares.
If we are unable to satisfy any of these conditions or otherwise fail to timely deliver shares of common stock upon conversion, the resulting cash settlement obligations could be substantial and could materially and adversely affect our business, financial condition, results of operations and prospects. In addition, the going concern explanatory paragraph in our auditor's report may itself adversely affect our ability to raise additional capital on favorable terms, our relationships with vendors, contract research organizations, contract manufacturers and other counterparties, and the trading price of our common stock.
For additional discussion, see Note 1 to the condensed consolidated financial statements included elsewhere in this Quarterly Report and the risk factors below under "Risks Related to the Acquisition."
IfIn July 2026, the FDA approved gedatolisib receivesfor regulatorythe approval,treatment itof wouldHR+/HER2-, becomePIK3CA wild-type metastatic breast cancer, making gedatolisib the first approved MNI therapy for HR+/HER2- advanced breast cancer and couldenabling it to establish a significant market position before PIKTOR completes clinical development. In that event,Accordingly, PIKTOR would need tomust demonstrate meaningful differentiation — whether through oral convenience, a favorable tolerability profile, broader patient applicability, or other clinical advantages — in order to compete effectively. There can be no assurance that PIKTOR will be able to demonstrate such differentiation. Furthermore, the PI3K/AKT/mTOR pathway is the subject of intense research, and new modalities or approaches could emerge that are superior to both gedatolisib and PIKTOR, rendering our competitive position obsolete.
In addition, if gedatolisib or another MNI that receives regulatory approval and is incorporated into the standard of care for any of our target indications, regulatory authorities may require that future clinical trials of PIKTOR, including any registrational trials, use the newly approved MNI as part of the comparator arm rather than the current standard of care. Such a change could require us to conduct larger, more expensive, and longer clinical trials than currently planned, raise the efficacy threshold that PIKTOR must demonstrate to achieve regulatory approval, and materially increase our development costs and delay our anticipated development timelines. Even if we are able to demonstrate superiority or non-inferiority to a newly approved MNI, the cost, complexity, and duration of the required trials could substantially exceed our current projections, and we may need to raise additional capital to fund such trials. There can be no assurance that we would be able to obtain such additional capital on acceptable terms, or at all.
We anticipate that we will compete with Alpelisib, Inavolisib, Capivasertib, Everolimus and Temsirolimus, all of which are approved drugs that target the PI3K/AKT/mTOR pathway. In addition, we are aware of several additional product candidates in clinical development that could potentially pose a direct competitive threat to PIKTOR, particularly for the treatment of advanced HR+/HER2- breast cancer. These product candidates include Gedatolisib, an intravenous pan-PI3K + mTORC1/2 inhibitor from Celcuity, whose New Drug Application for HR+/HER2-, PIK3CA wild-type metastatic breast cancer was accepted by the FDA with Priority Review and a Prescription Drug User Fee Act goal date of July 17, 2026; Tersolisib, an oral mutant-specific PI3Kα inhibitor from Eli Lilly currently in Phase 3 trials for HR+/HER2- breast cancer; Zovegalisib, an oral mutant-selective PI3Kα inhibitor from Relay Therapeutics currently in Phase 3 trials for advanced HR+/HER2- breast cancer; Afuresertib, an oral pan AKT inhibitor from Laekna Therapeutics currently in Phase 3 trials for advanced HR+/HER2- breast cancer; Paxalisib, an oral brain penetrant PI3K/mTOR inhibitor from Kazia Therapeutics currently in Phase 3 trials in glioblastoma; SNV4818, an oral pan-mutant-selective PI3Kα inhibitor acquired by Novartis from Synnovation Therapeutics in March 2026, currently in Phase 1/2 trials for HR+/HER2- breast cancer and other solid tumors; and OKI-219, an oral mutant-specific PI3Kα inhibitor from OnKure Therapeutics, currently in Phase 1/2 trials for HR+/HER2- breast cancer and other solid tumors. In addition, onin July 2026, the FDA approved Celcuity’s gedatolisib, and in May 1, 2026, Celcuity announced positive topline results from the PIK3CA mutant cohort of its Phase 3 VIKTORIA-1 trial, with both the gedatolisib triplet (gedatolisib plus fulvestrant plus palbociclib) and the gedatolisib doublet (gedatolisib plus fulvestrant) demonstrating statistically significant and clinically meaningful improvements in progression-free survival. Celcuity has indicated that it intends to submit a supplemental New Drug Application to the FDA for the PIK3CA mutant indication, and that detailed data from both VIKTORIA-1 cohorts will be presented at the 2026 American Society of Clinical Oncology Annual Meeting in early June 2026. If gedatolisib receives marketing approval in either or both indications, it couldGedatolisib establish a meaningful market position before PIKTOR completes clinical development. The two cohorts together cover a substantial portion of the HR+/HER2- advanced breast cancer patient population, which could narrow the addressable population for PIKTOR if gedatolisib achieves favorable approval and reimbursement. Our competitive thesis is that multi-node inhibition is a superior mechanism to provide deeper, more tolerable suppression of the PI3K/AKT/mTOR pathway than is currently available in approved therapeutics. If our thesis is incorrect, or if new modalities are developed that better suppress the PI3K/AKT/mTOR pathway, our business would be materially and adversely impacted.
Several of these competing product candidates are in Phase 3 registrational trials with potential approval timelines that are ahead of our development timeline for PIKTOR. In particular, Celcuity has now reported positive topline Phase 3 results from both the PIK3CA wild-type cohort and the PIK3CA mutant cohort of its VIKTORIA-1 trial, hashad its New Drug Application for gedatolisib in HR+/HER2-, PIK3CA wild-type metastatic breast cancer underapproved by the FDA Priority Review with a Prescription Drug User Fee Act goal date ofin July 17, 2026, and has announced its intention to file a supplemental New Drug Application for the PIK3CA mutant indication. If one or more competitors obtains regulatory approval and establishes a market position before we are able to enter the market, it could significantly diminish the commercial opportunity for PIKTOR, particularly if the approved product addresses the same patient population or demonstrates a superior safety or efficacy profile. Additionally, mutant-selective PI3Ka inhibitors being developed by Eli Lilly (tersolisib) and Relay Therapeutics (zovegalisib) are also in Phase 3 development and, if approved, could reduce the addressable market for PIKTOR by providing an alternative targeted approach for patients with PI3K-mutant tumors. Large pharmaceutical companies are making significant investments in the PI3K/AKT/mTOR space. For example, in March 2026, Novartis announced the acquisition of Synnovation Therapeutics’ pan-mutant-selective PI3Kα inhibitor program, including SNV4818, which is currently in Phase 1/2 clinical development for HR+/HER2- breast cancer. This and similar acquisitions could result in additional well-resourced competitors with established commercial infrastructure entering the market ahead of or concurrent with PIKTOR, which could significantly diminish our commercial opportunity.
In addition, our Non-Essential Amino Acid Restriction (“NEAAR”) program, which seeks to restrict patient intake of specific non-essential amino acids to suppress tumor growth, represents a novel therapeutic approach for which there is limited regulatory precedent. Dietary interventions are not subject to the same well-established regulatory approval pathways as pharmaceutical products, and it is unclear how the FDA or comparable foreign regulatory authorities would evaluate a dietary regimen as a component of a cancer treatment regimen. Even if we are able to generate clinical evidence supporting the use of NEAAR in combination with our other product candidates, third-party payors may be unwilling to provide coverage or reimbursement for a prescribed dietary intervention, which could limit patient adoption and reduce any potential commercial value of the program.
The United States has enacted and implemented wide-ranging patent reform legislation. The U.S. Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations. In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained. Depending on actions by the U.S.
The United States has enacted and implemented wide-ranging patent reform legislation. The U.S. Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations. In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained. Depending on actions by the U.S. Congress, the federal courts and the USPTO, the laws and regulations governing patents could change in unpredictable ways that would weaken our ability to obtain new patents or to enforce patents that we have licensed or that we might obtain in the future. For example, recent decisions raise questions regarding the award of patent term adjustment, or PTA, for patents in families where related patents have issued without PTA. Thus, it cannot be said with certainty how PTA will/will not be viewed in future and whether patent expiration dates may be impacted.
Securities litigation and stockholder activism, including proxy contests, could result in substantial costs and divert management’s and the Board’sBoard of Director’s attention and resources from our business. The potential of a proxy contest or other stockholder activism could interfere with our ability to execute on our strategic plan, give rise to perceived uncertainties as to our future direction, result in the loss of potential business opportunities or make it more difficult to attract and retain qualified personnel, any of which could materially and adversely affect our business and operating results. Further, our share price could be subject to significant fluctuation or otherwise be adversely affected by the events, risks and uncertainties of any securities litigation and stockholder activism.
Finally, in connection with the execution of the Agreement and Plan of Merger, or the Merger Agreement, dated as of February 17, 2026, by and among the Company, Sapphire First Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of the Company, Sapphire Second Merger Sub, LLC, a Delaware limited liability company and wholly owned subsidiary of the Company, Faeth Subsidiary and Faeth HoldCo, certain of our directors and officers, as well as certain of the directors, officers and stockholders of Faeth Therapeutics, each as of immediately prior to the Acquisition, entered into lock-up agreements, pursuant to which each such stockholder will beis subject to a 180-day lockup on the sale or transfer of shares of our common stock and Series B Preferred Stock held by each such stockholder, including those shares received by directors and officers in the Acquisition, subject to certain limited exceptions as set forth in such lock-up agreements. Upon expiration of this 180-day lockup period, these shares will become eligible for sale in the public market. Pursuant to the Merger Agreement and the registration rights agreement that we entered into pursuant to the 2026 Private Placement, we are obligated to prepare and filefiled a resale registration statement with the SEC to register the resale of shares of our common stock underlying the Series B Preferred Stock and warrant to purchase shares of Series B Preferred Stock.Stock, Weand willsuch use commercially reasonable efforts to cause this registration statement to be declared effected by the SEC. Once the registration statement is declared effective, theshares shares subject to the registration statement willnow no longer constitute restricted securities and may be sold freely in the public markets, subject to (i) the approval of the Company Stockholder Matters (as defined below), (ii) the approval of the Nasdaq Listing Application (as defined below) and (iii) any beneficial ownership limitations set by the holder of Series B Preferred Stock. If our stockholders sell, or indicate an intention to sell, substantial amounts of our common stock in the public market after legal restrictions on resale lapse, the trading price of our common stock could decline.
In general, under Section 382 of the Internal Revenue Code of 1986, as amended, or the Code, a corporation that undergoes an “ownership change” (as defined under Section 382 of the Code and applicable Treasury Regulations) is subject to limitations on its ability to utilize its pre-change NOLs to offset future taxable income. Following the approval of the Company Stockholder Matters,Matters on June 10, 2026, the Acquisition will resultresulted in an ownership change for us and, accordingly, our NOL carryforwards and certain other tax attributes willmay be subject to limitations (or disallowance) on their use after approval of the Company Stockholder Matters.use. Faeth’s NOL carryforwards may also be subject to limitations as a result of prior shifts in equity ownership and/or the Acquisition. We may also have experienced an ownership change in the past, and may experience ownership changes in the future as a result of subsequent shifts in our stock ownership, some of which are outside our control. Furthermore, our ability to utilize NOLs of Faeth that we acquired as a result of the Acquisition may be subject to limitations. There is also a risk that due to regulatory changes, such as suspensions on the use of NOLs or other unforeseen reasons, our existing NOLs could expire or otherwise be unavailable to reduce future income tax liabilities, including for state tax purposes. For these reasons, we may not be able to utilize a material portion of the NOLs reflected on our balance sheet, even if we attain profitability, which could potentially result in increased future tax liability to us and could adversely affect our operating results and financial condition.
Pursuant to the terms of the Acquisition, we are required to recommend that our stockholders approve the conversion of all outstanding shares of our Series B preferred stock into shares of our common stock. We must also obtain stockholder approval of an amendment to our certificate of incorporation to increase the number of shares we are authorized to issue. We cannot guarantee that our stockholders will approve these matters, and if they fail to do so we may be required to settle such shares in cash and our operations may be materially harmed.
Under the terms of the Merger Agreement and the 2026 Private Placement purchase agreement, as promptly as practicable following the date of the Merger Agreement and pursuant to the Nasdaq Stock Market Rules, we will call and hold a meeting of our stockholders to obtain the requisite approval from our legacy stockholders for, among other things, (i) the approval, in accordance with certain of the rules of Nasdaq of the conversion of the Series B Preferred Stock into shares of our common stock, or the Conversion Proposal, (ii) the approval of a “change of control” under Nasdaq Listing Rules 5110 and 5635(b), or the Change in Control Proposal, (iii) the amendment of our certificate of incorporation to authorize an increase of up to 300,000,000 shares of our common stock, or the Charter Amendment Proposal and, together with the Conversion Proposal and the Change in Control Proposal, the Company Stockholder Matters, (iv) the approval of (A) the 2026 Equity Incentive Plan, which will provide for new awards for a number of shares of our common stock not exceeding 10% of our fully diluted shares of capital stock outstanding immediately after the 2026 Private Placement, and subject to approval by our Board, and which will include an annual increase pursuant to an “evergreen” provision providing for an annual increase of up to 5% of the total number of our fully diluted shares of capital stock outstanding as of the day prior to such increase and (B) the 2026 Employee Stock Purchase Plan, with a total pool of shares of our common stock not exceeding 1% of our fully diluted shares of capital stock outstanding immediately after the 2026 Private Placement, and which shall include an annual increase pursuant to an “evergreen” provision providing for an annual increase of up to 1% of the total number of our fully diluted shares of capital stock outstanding as of the day prior to such increase. If we fail to receive sufficient proxies to constitute a quorum or to obtain the required vote on the Company Stockholder Matters and/or our Nasdaq Listing Application is not approved, we would be required to adjourn the meeting one or more times for up to 30 days per adjournment. If stockholder approval of the Company Stockholder Matters or approval of the Nasdaq Listing Application are still not obtained following such adjournment(s), we will be obligated to continue soliciting stockholder approval at subsequent annual or special meetings of our stockholders, held at intervals of no more than six months, until such approvals are obtained, which would be time consuming and costly.
There can be no assurance that our legacy stockholders will approve the Company Stockholder Matters. If our legacy stockholders do not approve the Charter Amendment Proposal, we would be unable to issue the additional shares of our common stock necessary to complete the conversion of Series B Preferred Stock into our common stock, and may be unable to satisfy our other capital needs, which could have a material adverse effect on our business, financial condition, and prospects.
Additionally, if the Company Stockholder Matters are not approved by the date that is six months following the initial issuance date of the Series B Preferred Stock, the holders of the Series B Preferred Stock would be entitled to require us to settle their shares of our common stock underlying the Series B Preferred Stock for cash at a price per share equal to the fair value of our common stock at such time as described in the Certificate of Designation or Preferences, Rights and Limitations of the Series B Preferred Stock, or the Certificate of Designation. If we are forced to cash settle a significant amount of the shares of our common stock underlying the Series B Preferred Stock, it could materially affect our results of operations, business and financial condition.
Failure to obtain approval of the Nasdaq Listing Application could materially affect our results of operations, business and financial condition.
Pursuant to the Merger Agreement, in order to permit the waiver of the beneficial ownership limitations applicable to the Series B Preferred Stock and take other actions following the consummation of the Acquisition, which would constitute a “change of control” under Nasdaq Listing Rule 5110(a), we are required to use our reasonable best efforts to file an initial listing application for our common stock on Nasdaq (the “Nasdaq Listing Application”). The Nasdaq Listing Application must be conditionally approved prior to the date of our stockholder meeting to approve the Company Stockholder Matters. If we fail to meet the Nasdaq listing requirements and Nasdaq does not approve the Nasdaq Listing Application, we will be required to adjourn our stockholder meeting to approve the Company Stockholder Matters one or more times for up to 30 days per adjournment, continue to use our reasonable best efforts to obtain approval of the Nasdaq Listing Application and to continue soliciting stockholder approval of the Company Stockholder Matters at subsequent annual or special meetings of our stockholders, held at intervals of no more than six months, until such approval and the approval of the Company Stockholder Matters are obtained, which would be time consuming and costly. Additionally, if the Company Stockholder Matters are not approved by the date that is six months following the initial issuance date of the Series B Preferred Stock, the holders of the Series B Preferred Stock would be entitled to require us to settle their shares of Series B Preferred Stock for cash at a price per share equal to the fair value of the Series B Preferred Stock at such time as described in the Certificate of Designation or Preferences, Rights and Limitations of the Series B Preferred Stock. If we are forced to cash settle a significant amount of the shares of our common stock underlying the Series B Preferred Stock, it could materially affect our results of operations, business and financial condition. We cannot assure you that we will be able to meet Nasdaq’s initial listing standards. Furthermore, if we fail to obtain approval of the Nasdaq Listing Application, we may be unable to execute on our plans for the Company following the Acquisition, which could materially affect our results of operations, business and financial condition.
Management's Discussion & Analysis (MD&A)
New heading “Comparison of the Six Months Ended June 30, 2026 and 2025”
New heading “Research and Development Expenses”
New heading “General and Administrative Expenses”
Largest changes
“In addition, our future capital requirements will depend on many factors, including, without limitation, the timing of stockholder approval of the Company Stockholder Matters and the potential cash settlement obligations that may arise if we are unable to timely deliver shares of our common stock upon conversion of the Series B Preferred Stock. …”see in full comparison
“If we are unable to obtain approval of the Company Stockholder Matters or approval of the Nasdaq Listing Application, or if we are otherwise unable to timely deliver shares of our common stock upon conversion — whether due to an insufficient number of authorized shares, Nasdaq listing requirements, or other factors — we could become obligated to make significant cash settlement payments to holders of Series B Preferred Stock who submit conversion notices after the applicable trigger date. …”see in full comparison
“We expect our general and administrative expenses in future periods to be lower than those incurred during the six months ended June 30, 2026, which included significant non-recurring costs associated with the Acquisition, including stock-based compensation expense related to the accelerated vesting of Faeth employee stock options and transaction costs. …”see in full comparison
Full comparison: every changed paragraph (43)
Unless otherwise indicated, all information in this Quarterly Report on Form 10-Q gives effect to a 1-for-20 reverse stock split of our common stock that became effective on June 16, 2025 (the "Reverse Stock Split"), and all references to historical share and per share amounts give effect to the Reverse Stock Split.
We are a clinical-stage biotechnology company focused on improving outcomes for cancer patients through multi-node inhibition of critical oncogenic pathways. On February 17, 2026, we completed the Acquisitionacquisition of Faeth Therapeutics, a clinical-stage biotechnology company developing multi-node therapies targeting tumor metabolism and signaling,signaling (the “Acquisition”), and received $200 million in gross proceeds from the 2026 Private Placement from a broad syndicate of institutional investors. Effective June 15, 2026, we changed our corporate name from Sensei Biotherapeutics, Inc. to Faeth Therapeutics, Inc. The acquisition brought Faeth's lead asset, PIKTOR, a proprietary investigational all-oral combination of serabelisib and sapanisertib that inhibits multiple nodes of the PI3K/AKT/mTOR pathway, into our pipeline. For additional information regarding the terms of the acquisition and the concurrent financing, see Note 3 to the condensed consolidated financial statements.
Following the Acquisition, our lead program is PIKTOR, an oral multi-node inhibitor of the PI3K/AKT/mTOR pathway in development for endometrial and breast cancer. The PI3K/AKT/mTOR pathway is dysregulated in up to 50% of all solid tumors, making it one of the most prevalent therapeutic targets in oncology. Our core thesis is that simultaneously suppressing multiple pathway nodes can produce deeper, more durable tumor suppression than approved therapies that target only a single node. PIKTOR is currently being evaluated in an ongoing Phase 2 trial in second-line advanced endometrial cancer (Study FTH-PIK-201), with topline data anticipated inby theyear-end. second half of 2026, andAdditionally, in April 2026 the first patient was dosed in our Phase 1b/2 trial in HR+/HER2- advanced breast cancer (Study FTH-PIK-101), from which we expect to report interim data in 2027. We believe the $200 million in gross financing proceeds, together with our existing cash, cash equivalents and marketable securities, will be sufficient to fund operations through these key clinical milestones.
We have incurred significant operating losses since our inception and expect to continue to incur losses for the foreseeable future. Our net loss was $170.2$186.2 million and $6.9$11.8 million for the threesix months ended MarchJune 31,30, 2026 and 2025, respectively. As of MarchJune 31,30, 2026, we had an accumulated deficit of $453.4$469.4 million and cash, cash equivalents and marketable securities of $202.8$186.4 million, which includes $183.1 million in net proceeds received in the 2026 Private Placement. The increase in our net loss for the threesix months ended MarchJune 31,30, 2026 compared to the same prior year period was primarily attributable to $133.0 million of acquired in-process research and development expense recognized in connection with the Acquisition of Faeth Therapeutics,Acquisition, as well as increased research and development and general and administrative expenses resulting from the integration of Faeth's operations, including stock-based compensation expense related to the accelerated vesting of Faeth employee stock options and related tax gross-up payments.
employee-related expenses, including salaries, bonuses, benefits and stock-based compensation, severance costs and other related costs for those employees engaged in the research and development function;
fees for maintaining licenses and other amounts due under our third partythird-party licensing agreements;
We expense all research and development costs in the periods in which they are incurred. Costs for certain research and development activities are recognized based on an evaluation of the progress to completion of specific tasks using information and data provided to us by our vendors and third-party service providers. Nonrefundable advance payments for goods or services to be received in the future for use in research and development activities are recorded as prepaid expenses. Such amounts are recognized as an expense when the goods have been delivered or the services have been performed, or when it is no longer expected that the goods will be delivered or the services rendered.
Our direct external research and development expenses consist primarily of third partythird-party costs, such as fees paid to CROs, CMOs, research/testing laboratories and outside consultants in connection with our preclinical development, process development, manufacturing and clinical development activities. We do not allocate these costs to specific product candidates because many of them are deployed across several of our development programs and, as such, are not separately classified. All other external research and development costs, including personnel costs, are not allocated to specific product candidates as they support multiple development programs. We have historically used internal resources primarily to conduct research and manage our preclinical development, process development, manufacturing and clinical development activities. These employees have worked across multiple development programs and, therefore, we have not historically tracked their costs by program and, as such, are not separately classified. Research and development activities are central to our business model. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials.
Our expenditures are subject to additional uncertainties, including the terms and timing of regulatory approvals. We may never succeed in achieving regulatory approval for any of our product candidates. We may obtain unexpected results from our clinical trials.
Our expenditures are subject to additional uncertainties, including the terms and timing of regulatory approvals. We may never succeed in achieving regulatory approval for any of our product candidates. We may obtain unexpected results from our clinical trials. We may elect to discontinue, delay or modify clinical trials of some product candidates or focus on others. A change in the outcome of any of these variables with respect to the development of a product candidate could mean a significant change in the costs and timing associated with the development of that product candidate. For example, if the FDA or other regulatory authorities were to require us to conduct clinical trials beyond those that we currently anticipate, or if we experience significant delays in enrollment in any of our clinical trials, we could be required to expend significant additional financial resources and time on the completion of clinical development. Product commercialization will take several years and significant additional development costs.
Comparison of the Three Months Ended MarchJune 31,30, 2026 and 2025
The following sets forth our results of operations for the three months ended MarchJune 31,30, 2026 and 2025:
Research and development expenses were $18.0$9.2 million for the three months ended MarchJune 31,30, 2026, compared to $3.7$2.5 million for the three months ended MarchJune 31,30, 2025. The increase of $14.2$6.6 million was primarily driven by thedevelopment inclusioncosts offor FaethPIKTOR Therapeuticswhich operationscontributed followingapproximately the February 2026 acquisition, contributing $1.8$5.0 million of research and development costs for the quarter, including preclinical, clinical trial, and chemistry, manufacturing and controls (or "CMC") related expenses, $4.8together with an increase of $2.3 million ofrelated non-cashpersonnel costs, including stock-based compensation expense and $9.1incentives. million of non-recurring tax gross-up payments related to the accelerated vesting of Faeth options, and $0.7 million of stock-based compensation from inducement grants issued to Faeth employees, partially offset by a $2.2 million decrease in legacyLegacy Sensei programs research and development spending.spend was $0.7 million lower primarily due to lower expense associated with clinical trials.
We expect research and development expenses in future periods to be lower than those incurred during the three months ended March 31, 2026, which included significant non-recurring costs associated with the Acquisition, including stock-based compensation expense related to the accelerated vesting of Faeth employee stock options and tax gross-up payments. However, we expect our ongoing research and development expenses to increase significantly as we advance PIKTOR through our ongoing Phase 2 trial in advanced endometrial cancer and our recently initiated Phase 1b/2 trial in HR+/HER2- advanced breast cancer, and as we expand preclinical and CMC activities for our broader pipeline.
General and administrative expenses were $9.2 million for the three months ended June 30, 2026, compared to $2.7 million for the three months ended June 30, 2025. The increase of $6.5 million was primarily driven by $3.6 million of higher personnel costs, including stock-based compensation and incentives, $1.6 million of increased external administrative fees, $1.1 million of higher consulting expense and $0.2 million of higher licensing fees.
Other Income
Other income was $2.4 million for the three months ended June 30, 2026, compared to other income of $0.3 million for the three months ended June 30, 2025. The increase of $2.1 million was primarily related to an increase in interest income on securities.
Comparison of the Six Months Ended June 30, 2026 and 2025
The following sets forth our results of operations for the six months ended June 30, 2026 and 2025:
Research and Development Expenses
GeneralResearch and administrativedevelopment expenses were $19.7$27.1 million for the threesix months ended MarchJune 31,30, 2026, compared to $3.5$6.3 million for the threesix months ended MarchJune 31,30, 2025. The increase of $16.2$20.9 million was primarily driven by acquisition-relatedthe charges consistinginclusion of $6.2development costs of PIKTOR following the February 2026 acquisition, contributing $6.1 million of research and development costs including preclinical, clinical trial, and CMC related expenses, significant non-recurring costs associated with the Acquisition including $4.8 million of non-cash stock-based compensation expense and $6.5$9.1 million of non-recurring tax gross-up payments related to the accelerated vesting of Faeth options, $2.5along with $3.3 million of transactionhigher personnel costs, $0.6including millionstock-based of Faeth operating costs, $0.8 million related to inducement grants issued to Faeth employeescompensation and $0.2 million related to assumed options,incentives, partially offset by a $0.6$2.4 million reductiondecrease in legacy Sensei programs research and development expenses.
We expect our generalresearch and administrativedevelopment expenses in future periods to be lower than those incurred during the threesix months ended MarchJune 31,30, 2026, which included significant non-recurring costs associated with the Acquisition, including stock-based compensation expense related to the accelerated vesting of Faeth employee stock options and transactiontax costs.gross-up payments. However, we expect our ongoing generalresearch and administrativedevelopment expenses to remainincrease significantly higheras thanwe advance PIKTOR through our pre-Acquisitionongoing levelsPhase 2 trial in advanced endometrial cancer and our recently initiated Phase 1b/2 trial in HR+/HER2- advanced breast cancer, and as awe resultexpand of the integration of Faeth Therapeutics' operations, including personnel costs associated with the expanded workforcepreclinical and theCMC supportactivities offor our broader product pipeline, as well as additional costs associated with operating as a larger public company, including consulting, legal, tax-related services, accounting, investor relations, and insurance premiums.pipeline.
General and Administrative Expenses
General and administrative expenses were $28.9 million for the six months ended June 30, 2026, compared to $6.2 million for the six months ended June 30, 2025. The increase of $22.7 million was primarily driven by acquisition-related charges consisting of $6.2 million of non-cash stock-based compensation expense and $6.5 million of non-recurring tax gross-up payments related to the accelerated vesting of Faeth options, $2.5 million of transaction costs, $2.3 million of Faeth operating costs, and $4.5 million of higher personnel costs, including stock-based compensation and incentives, along with a $0.7 million increase primarily due to integration-related professional fees.
We expect our general and administrative expenses in future periods to be lower than those incurred during the six months ended June 30, 2026, which included significant non-recurring costs associated with the Acquisition, including stock-based compensation expense related to the accelerated vesting of Faeth employee stock options and transaction costs. However, we expect our ongoing general and administrative expenses to remain significantly higher than our pre-Acquisition levels as a result of the integration of Faeth Therapeutics' operations, including personnel costs associated with the expanded workforce and the support of our broader product pipeline, as well as additional costs associated with operating as a larger public company, including consulting, legal, tax-related services, accounting, investor relations, and insurance premiums.
Acquired in-process research and development expense was $133.0 million for the threesix months ended MarchJune 31,30, 2026, with no comparable expense in the prior year period. The charge was recognized in connection with the acquisition of Faeth TherapeuticsAcquisition in February 2026 and represents the fair value of acquired IPR&D assets that had no alternative future use as of the acquisition date. See Note 3 to our unaudited condensed consolidated financial statement included elsewhere in this Quarterly Report for additional information regarding the acquisition.
Other income was $0.4$2.8 million for the threesix months ended MarchJune 31,30, 2026 andcompared to $0.7 million for the six months ended June 30, 2025. ForThe both$2.1 periodsmillion thisincrease was primarily consistedrelated ofto an increase in interest income related toon securities.
We have not generated any product revenue and have incurred net losses and negative cash flows from our operations. As of MarchJune 31,30, 2026, we had cash, cash equivalents and marketable securities of $202.8$186.4 million. We have financed our operations through sales of our common stock, redeemable convertible preferred stock and convertible debt. Through the date of this Quarterly Report, we have raised an aggregate of $123.4 million of gross proceeds from private placements of our equity and convertible debt securities and net proceeds of $138.5 million from our IPO in February 2021 and an additional $183.1 million in net proceeds received in the 2026 Private Placement. Our net loss was $170.2$186.2 million and $6.9$11.8 million for the threesix months ended MarchJune 31,30, 2026 and 2025, respectively. As of MarchJune 31,30, 2026, we had an accumulated deficit of $453.4$469.4 million. Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures and general and administrative expenditures.
We expect our cash requirements to increase as we advance PIKTOR through multiple clinical trials following the Acquisition of Faeth Therapeutics,Acquisition, including our ongoing Phase 2 trial in advanced endometrial cancer and our recently initiated Phase 1b/2 trial in HR+/HER2- advanced breast cancer, and we believe our existing cash, cash equivalents and marketable securities of $202.8$186.4 million are sufficient to fund operations through topline data readouts from both studies.
The following table summarizes our sources and uses of cash for each of the periods below (in thousands):
During the threesix months ended MarchJune 31,30, 2026, net cash used in operating activities was $10.7$26.4 million, primarily resulting from our $170.2$186.2 million net loss partially offset by a $13.3$9.8 million increase in our operating assets and liabilities and increases in non-cash charges of $146.2$150.0 million, primarily related to $133.0 million of acquired in-process research and development from the acquisitionAcquisition, of Faeth Therapeutics, $12.9$17.4 million of stock compensation expense and $0.4$0.7 million of non-cash lease expense partially offset by $0.1$1.1 million of accretion on marketable securities. The change in operating assets and liabilities was primarily related to a $10.7$10.3 million decrease in prepaid expenses related to tax gross-up expenses for the accelerated vesting of options and a $2.6$0.2 million increase in accruedaccounts compensationpayable and employeeaccrued benefitsliabilities relatedand toa unpaid$0.1 taxmillion gross-upincrease expensesin forother theassets acceleratedoffset vestingby ofa options.$0.8 million decrease in operating lease liabilities.
During the threesix months ended MarchJune 31,30, 2025, net cash used in operating activities was $7.1$13.0 million, primarily resulting from our $6.9$11.8 million net loss and a $0.9$2.3 million decrease in our operating assets and liabilities partially offset by increases in non-cash charges of $0.6$1.1 million, primarily related to $0.5$0.8 million of non-cash lease expense and $0.7 million of stock compensation expense and $0.4 million of non-cash lease expense, partially offset by $0.3$0.4 million of accretion on marketable securities.
During the three months ended March 31, 2026, net cash used in investing activities was $31.4 million, primarily due to $43.9 million in purchases of short-term investments, partially offset by $6.5 million in cash assumed from the acquisition of Faeth and $6.0 million in maturities of short-term investments.
During the threesix months ended MarchJune 31,30, 2025,2026, net cash providedused byin investing activities was $7.2$139.5 million, primarily due to $13.5$158.6 million in maturitiespurchases of short-term investments, partially offset by $6.3$12.6 million in purchasesmaturities of short-term investments.investments and $6.5 million in cash assumed from the Acquisition.
During the six months ended June 30, 2025, net cash provided by investing activities was $15.9 million, primarily due to $24.5 million in maturities of short-term investments and $0.2 million of proceeds from the sale of property and equipment, partially offset by $8.8 million in purchases of short-term investments.
During the threesix months ended MarchJune 31,30, 2026, net cash provided by financing activities was $185.8$184.1 million, primarily consisting of $200.0 million proceeds from the issuance of Series B Preferred Stock, $1.0$1.1 million from the exercise of options into common stock, partially offset by $15.1$16.9 million of issuance costs from the private placement issuance of Series B Preferred Stock and $0.1 million of principal payments under our financing leases.
During the threesix months ended MarchJune 31,30, 2025, net cash used in financing activities was $0.2$0.4 million, primarily consisting of $0.2$0.5 million of principal payments under our financing leases.leases, partially offset by $0.1 million of proceeds from the sale of financing lease assets.
We have operating lease arrangements for our corporate offices,offices and lab facilities and an executive residence. As part of our adoption of ASC 842, we recorded operating ROU assets and operating lease liabilities for these leases as of January 1, 2022.facilities. As of MarchJune 31,30, 2026, we had operating lease payment obligations of $1.0$0.6 million, with $1.0$0.5 million payable for the remainder of 2026. See Note 7 in our condensed consolidated financial statements included elsewhere in this Form 10-Q for additional information.
In addition, our future capital requirements will depend on many factors, including, without limitation, the timing of stockholder approval of the Company Stockholder Matters and the potential cash settlement obligations that may arise if we are unable to timely deliver shares of our common stock upon conversion of the Series B Preferred Stock. In connection with the Acquisition, we issued 24,937.493 shares of Series B Preferred Stock, each share of which is convertible into 1,000 shares of our common stock, subject to certain beneficial ownership limitations and receipt of approval of the Company Stockholder Matters. The shares of Series B Preferred Stock will automatically convert upon the third business day following receipt of approval of the Company Stockholder Matters stockholder approval in accordance with Nasdaq listing rules up to the beneficial ownership limitations set by each holder; provided that such beneficial ownership limitations may be waived by each holder of Series B Preferred Stock at any time following the approval by Nasdaq of the Nasdaq Listing Application and approval of the Company Stockholder Matters.
The Certificate of Designation contains a provision that, at any time following the earlier of (i) approval of the Company Stockholder Matters or (ii) six months after the initial issuance of the Series B Preferred Stock, if we fail to deliver shares of our common stock to a converting holder within the time periods required by the Certificate of Designation, such holder may require us to pay, in lieu of delivering the applicable conversion shares, an amount of cash equal to the fair value of the undelivered shares based on the last reported closing sale price of our common stock on the principal trading market on which our common stock is listed as of the trading day immediately prior to the date on which the applicable notice of conversion was delivered to us. Such payment would be required within two business days of the holder's request.
If we are unable to obtain approval of the Company Stockholder Matters or approval of the Nasdaq Listing Application, or if we are otherwise unable to timely deliver shares of our common stock upon conversion — whether due to an insufficient number of authorized shares, Nasdaq listing requirements, or other factors — we could become obligated to make significant cash settlement payments to holders of Series B Preferred Stock who submit conversion notices after the applicable trigger date. Given the number of shares of Series B Preferred Stock outstanding and the potential magnitude of such cash settlement obligations, which would be determined by reference to the then-current trading price of our common stock, any such payments could require us to use a substantial portion of our available cash resources or to seek additional financing to satisfy these obligations, which could materially limit the amount of cash available to fund our operations and advance our clinical programs.
Additionally, even following stockholder approval of the Company Stockholder Matters, certain holders may be unable to convert their shares of Series B Preferred Stock due to the application of beneficial ownership limitations set by such holder. Shares of Series B Preferred Stock that are not converted in the automatic conversion on account of beneficial ownership limitations will remain outstanding until converted at the option of the applicable holder, and the cash settlement provisions described above would apply to any failure to timely deliver conversion shares in connection with any such optional conversion.
We define our critical accounting policies as those accounting principles that require us to make subjective estimates and judgments about matters that are uncertain and are likely to have a material impact on our financial condition and results of operations, as well as the specific manner in which we apply those principles. During the threesix months ended MarchJune 31,30, 2026, we acquired in-process research and development intangible assets in connection with the Faeth Therapeutics merger, which represents a new critical accounting policy not previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on March 30, 2026. Except for this addition, there were no other significant changes to our critical accounting policies which are included in our Annual Report on Form 10-K.
FTH insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 7 Form 4 filings (4 insiders, 15 trade dates, 96,474 shares, about $2.5M) and open-market sales in 5 filings (4 insiders, 9 trade dates, 73,067 shares, about $1.7M). Net open-market shares: 23,407 (purchases minus sales); net value about $825.0K.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-07-01 | Stephenson Brian C |
Open-market purchase | 600 | $24.22 | $14.5K |
| 2026-07-01 | Stephenson Brian C |
Open-market purchase | 4,400 | $23.40 | $103.0K |
| 2026-06-30 | Stephenson Brian C |
Open-market purchase | 1,638 | $23.88 | $39.1K |
| 2026-06-30 | Stephenson Brian C |
Open-market purchase | 1,910 | $22.95 | $43.8K |
| 2026-06-30 | Stephenson Brian C |
Open-market purchase | 4,255 | $24.98 | $106.3K |
| 2026-06-29 | Stephenson Brian C |
Open-market purchase | 831 | $23.34 | $19.4K |
| 2026-06-26 | Stephenson Brian C |
Open-market purchase | 100 | $26.39 | $2.6K |
| 2026-06-26 | Stephenson Brian C |
Open-market purchase | 1,358 | $25.55 | $34.7K |
| 2026-06-26 | Stephenson Brian C |
Open-market purchase | 4,212 | $24.90 | $104.9K |
| 2026-06-26 | Stephenson Brian C |
Open-market purchase | 580 | $23.61 | $13.7K |
| 2026-06-24 | Stephenson Brian C |
Open-market purchase | 100 | $27.77 | $2.8K |
| 2026-06-24 | Stephenson Brian C |
Open-market purchase | 3,400 | $26.98 | $91.7K |
| 2026-06-24 | Stephenson Brian C |
Open-market purchase | 3,000 | $25.98 | $77.9K |
| 2026-06-24 | Stephenson Brian C |
Open-market purchase | 2,891 | $25.22 | $72.9K |
| 2026-06-23 | Stephenson Brian C |
Open-market purchase | 6,836 | $24.12 | $164.9K |
| 2026-06-23 | Stephenson Brian C |
Open-market purchase | 1,969 | $24.84 | $48.9K |
| 2026-06-23 | Stephenson Brian C |
Open-market purchase | 425 | $25.91 | $11.0K |
| 2026-06-22 | Stephenson Brian C |
Open-market purchase | 1,118 | $20.82 | $23.3K |
| 2026-06-22 | Stephenson Brian C |
Open-market purchase | 1,583 | $22.40 | $35.5K |
| 2026-06-22 | Stephenson Brian C |
Open-market purchase | 3,329 | $23.28 | $77.5K |
| 2026-06-22 | Stephenson Brian C |
Open-market purchase | 356 | $23.95 | $8.5K |
| 2026-06-22 | Stephenson Brian C |
Open-market purchase | 1,797 | $20.23 | $36.4K |
| 2026-06-22 | Parikh Anand Kiran |
Option exercise | 45,252 | $1.16 | $52.5K |
| 2026-06-22 | Parikh Anand Kiran |
Option exercise | 8,213 | $1.16 | $9.5K |
| 2026-06-22 | Parikh Anand Kiran |
Open-market purchase | 2,806 | $19.76 | $55.4K |
| 2026-06-15 | Parikh Anand Kiran |
Conversion | 761,428 | — | — |
| 2026-06-15 | Hahn Stephen M. |
Conversion | 44,763 | — | — |
| 2026-06-01 | Cambrian Biopharma Inc |
Open-market sale | 24,524 | $20.00 | $490.5K |
| 2026-06-01 | Cambrian Biopharma Inc |
Open-market sale | 476 | $21.14 | $10.1K |
| 2026-06-01 | Peyer James |
Open-market sale | 24,524 | $20.00 | $490.5K |
| 2026-06-01 | Peyer James |
Open-market sale | 476 | $21.14 | $10.1K |
| 2026-04-07 | Ics Opportunities Ii Llc |
Open-market purchase | 1,108 | $33.38 | $37.0K |
| 2026-04-07 | Ics Opportunities Ii Llc |
Open-market sale | 2,115 | $28.94 | $61.2K |
| 2026-04-07 | Ics Opportunities Ii Llc |
Open-market sale | 205 | $29.71 | $6.1K |
| 2026-04-07 | Ics Opportunities Ii Llc |
Open-market sale | 4,423 | $31.38 | $138.8K |
| 2026-04-07 | Ics Opportunities Ii Llc |
Open-market sale | 300 | $32.25 | $9.7K |
| 2026-04-07 | Ics Opportunities Ii Llc |
Open-market sale | 1,108 | $33.38 | $37.0K |
| 2026-04-06 | Ics Opportunities Ii Llc |
Open-market sale | 45 | $31.96 | $1.4K |
| 2026-04-06 | Ics Opportunities Ii Llc |
Open-market sale | 1,214 | $31.02 | $37.7K |
| 2026-04-06 | Ics Opportunities Ii Llc |
Open-market purchase | 1,104 | $31.02 | $34.2K |
| 2026-04-02 | Ics Opportunities Ii Llc |
Open-market sale | 1,134 | $34.80 | $39.5K |
| 2026-04-02 | Ics Opportunities Ii Llc |
Open-market sale | 374 | $33.35 | $12.5K |
| 2026-04-02 | Ics Opportunities Ii Llc |
Open-market sale | 1,794 | $32.60 | $58.5K |
| 2026-04-02 | Ics Opportunities Ii Llc |
Open-market sale | 1,265 | $31.75 | $40.2K |
| 2026-04-02 | Ics Opportunities Ii Llc |
Open-market sale | 3,099 | $30.86 | $95.6K |
| 2026-04-02 | Ics Opportunities Ii Llc |
Open-market purchase | 1,276 | $34.75 | $44.3K |
| 2026-04-02 | Ics Opportunities Ii Llc |
Open-market purchase | 26 | $33.47 | $870 |
| 2026-04-02 | Ics Opportunities Ii Llc |
Open-market purchase | 701 | $35.55 | $24.9K |
| 2026-04-01 | Millennium Management Llc |
Open-market purchase | 1,613 | $34.59 | $55.8K |
| 2026-04-01 | Millennium Management Llc |
Open-market purchase | 1,161 | $31.53 | $36.6K |
| 2026-04-01 | Millennium Management Llc |
Open-market sale | 46 | $34.75 | $1.6K |
| 2026-04-01 | Millennium Management Llc |
Open-market sale | 1,104 | $31.52 | $34.8K |
| 2026-04-01 | Millennium Management Llc |
Open-market purchase | 3,401 | $35.46 | $120.6K |
| 2026-03-31 | Millennium Management Llc |
Open-market purchase | 186 | $30.48 | $5.7K |
| 2026-03-31 | Millennium Management Llc |
Open-market purchase | 616 | $24.69 | $15.2K |
| 2026-03-31 | Millennium Management Llc |
Open-market purchase | 1,770 | $25.32 | $44.8K |
| 2026-03-31 | Millennium Management Llc |
Open-market purchase | 1,048 | $26.73 | $28.0K |
| 2026-03-31 | Millennium Management Llc |
Open-market purchase | 17 | $27.78 | $472 |
| 2026-03-31 | Millennium Management Llc |
Open-market purchase | 1,957 | $31.45 | $61.5K |
| 2026-03-31 | Millennium Management Llc |
Open-market purchase | 411 | $32.60 | $13.4K |
Well-known investors holding FTH (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Renaissance Technologies | 2026-06-30 | 20,416 | $510.4K | 0.0% | Reduced 36% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 12,296 | $307.4K | 0.0% | New position |