JANX 10-K & 10-Q changes, risk factors and insider trading
Janux Therapeutics, Inc. · Nasdaq · Pharmaceutical Preparations · CIK 1817713 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “Disruptions to the operations of the FDA, the SEC, other U.S. governmental agencies or comparable foreign regulatory authorities caused by funding shortages, leadership changes, staffing cuts or other staffing shortages, along with uncertainty regarding the potential for new initiatives, laws, regulations, policies and guidance affecting our product candidates or other aspects of our business, could materially and adversely affect our business.”
New heading “International trade policies, including tariffs, sanctions and trade barriers may adversely affect our business, financial condition, results of operations and prospects.”
Removed heading “Disruptions at the FDA and other comparable foreign regulatory authorities and bodies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, or approved or commercialized in a timely manner or at all, which could negatively impact our business.”
Removed heading “The United Kingdom’s withdrawal from the European Union may have a negative effect on global economic conditions, financial markets and our business, which could reduce the price of our common stock.”
Largest changes
“Additionally, the U.S. Department of Justice issued a rule titled The Preventing Access to Americans’ Bulk Sensitive Personal Data and United States Government-Related Data by Countries of Concern, which places additional restrictions on certain data transactions involving countries of concern (e.g., China, Russia, and Iran) and covered persons (i.e., individuals and entities who are designated as such by the U.S. …”see in full comparison
“International trade policies, including tariffs, sanctions and trade barriers may adversely affect our business, financial condition, results of operations and prospects.”see in full comparison
“The complexity of announced or future tariffs may also increase the risk that we or our customers or suppliers may be subject to civil or criminal enforcement actions in the United States or foreign jurisdictions related to compliance with trade regulations. Foreign governments may also adopt non-tariff measures, such as procurement preferences or informal disincentives to engage with, purchase from or invest in U.S. entities, which may limit our ability to compete internationally and attract non-U.S. investment, employees, customers and suppliers. …”see in full comparison
“In addition, on December 11, 2025, the European Commission, the Parliament and the European Council reached a political agreement on the Pharma Package. The reform has been under negotiation since the European Commission submitted its proposal in April 2023. This package, comprised of a new directive and regulation to replace existing legislation, aims to modernize the EU framework. The political agreement is still subject to formal approval by the European Parliament and Council. …”see in full comparison
“Disruptions to the operations of the FDA, the SEC, other U.S. governmental agencies or comparable foreign regulatory authorities caused by funding shortages, leadership changes, staffing cuts or other staffing shortages, along with uncertainty regarding the potential for new initiatives, laws, regulations, policies and guidance affecting our product candidates or other aspects of our business, could materially and adversely affect our business.”see in full comparison
“Current or future tariffs will result in increased research and development expenses, including with respect to increased costs associated with biological materials, laboratory equipment and research materials and components. In addition, such tariffs will increase our supply chain complexity and could also potentially disrupt our existing supply chain. Trade restrictions affecting the import of materials necessary for clinical trials could result in delays to our development timelines. …”see in full comparison
Full comparison: every changed paragraph (57)
As of December 31, 2024,2025, we had $1.0$966.6 billionmillion in cash, cash equivalents and short-term investments. Based upon our current operating plan, we estimate that our existing cash, cash equivalents and short-term investments will be sufficient to fund our operating expenses and capital expenditure requirements for at least the next 12 months following the date of this Annual Report. However, we believe that our existing cash, cash equivalents and short-term investments will not be sufficient to fund any of our product candidates through regulatory approval, and we will need to raise substantial additional capital to complete the development and commercialization of our product candidates.
To the extent we raise funds through collaborations or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us. For example, we have entered into a collaborationcollaborations with Merck and BMS to develop certain specified product candidates, which contains exclusive license rights in favor of Merck.Merck and BMS. If Merck or BMS decides not to pursue the collaboration, we will not receive the benefit of the milestone and royalty payments that we would otherwise potentially receive pursuant to our collaboration with Merck or BMS, as applicable, and accordingly may need to raise capital from other sources. If we are unable to raise additional funds when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves. Our ability to raise additional funds may be adversely impacted by potential worsening global economic conditions and disruptions to and volatility in the credit and financial markets in the United States and worldwide. Because of the numerous risks and uncertainties associated with product development, we cannot predict the timing or amount of increased expenses and cannot assure you that we will ever be profitable or generate positive cash flow from operating activities.
Our product candidates may be used in combination with other cancer drugs, such as other immuno-oncology agents, monoclonal antibodies or other protein-based drugs or small molecule anti-cancer agents such as targeted agents or chemotherapy, which can cause side effects or adverse events that are unrelated to our product candidate but may still impact the success of our clinical trials. Additionally, our product candidates could potentially cause adverse events. The inclusion of critically ill patients in our clinical trials may result in deaths or other adverse medical events due to other therapies or medications that such patients may be using. As described above, any of these events could prevent us from obtaining regulatory approval or achieving or maintaining market acceptance of our product candidates and impair our ability to commercialize our products. Because all of our product candidates are derived from our platform technologies, a clinical failure of one of our product candidates may also increase the actual or perceived likelihood that our other product candidates will experience similar failures.
In addition, our ongoing and planned clinical trials may compete with other clinical trials that are in the same therapeutic areas as our product candidates, and this competition will reduce the number and types of patients available to us, because some patients who might have opted to enroll in our trials may instead opt to enroll in a trial being conducted by one of our competitors. Further, because ourwe have ongoing and planned clinical trials are in patients with relapsed/refractory cancer, the patients are typically in the late stages of their disease and may experience disease progression independent from our product candidates, making them unevaluable for purposes of the clinical trial and requiring additional patient enrollment.
As we continue developing and conducting clinical trials of our product candidates, serious adverse events (SAEs), undesirable side effects, relapse of disease or unexpected characteristics may emerge causing us to abandon these product candidates or limit their development to more narrow uses or subpopulations in which the SAEs or undesirable side effects or other characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective or in which efficacy is more pronounced or durable. Should we observe any SAEs in our ongoing or planned clinical trials or identify other undesirable side effects or other unexpected findings depending on their severity, our trials could be delayed or even stopped and our development programs may be halted entirely, such as imposition of a clinical hold by the FDA or comparable actions of foreign regulatory authorities and institutional review boards and ethics committees. The class of TCEs has been associated with overactivation of the immune system leading to cytokine release syndrome (CRS) and on-target healthy tissue toxicities, and while we have designed our TRACTrTRACTr, TRACIr and TRACIrARM platform technologies and product candidates to mitigate these safety risks, until such time as we complete large-scale human trials there can be no assurances that our product candidates will not experience similar effects.
Disruptions to the operations of the FDA, the SEC, other U.S. governmental agencies or comparable foreign regulatory authorities caused by funding shortages, leadership changes, staffing cuts or other staffing shortages, along with uncertainty regarding the potential for new initiatives, laws, regulations, policies and guidance affecting our product candidates or other aspects of our business, could materially and adversely affect our business.
Disruptions at the FDA and other comparable foreign regulatory authorities and bodies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, or approved or commercialized in a timely manner or at all, which could negatively impact our business.
The ability of the FDA,FDA EMA, European Commission, andor other comparable foreign regulatory authorities to review applications for approval and approve new products or take action with respect to other regulatory matters can be affected by a variety of factors, including government budget and funding levels, leadership changes, the ability to hire and retain key personnel and accept the payment of user fees, andthe statutory,availability regulatory,of personnel and policyother changes.resources, changes in statutes, regulations and policies that affect the FDA’s or comparable foreign regulatory authorities’ ability to perform routine functions, and other business disruptions. Average review times at the FDA and comparable foreign regulatory authorities have fluctuated in recent years as a result. In addition, government funding of the SEC and other government agencies on which our operations may rely, including those that fund research and development activities is subject to the political process, which is inherently fluid and unpredictable.
Over the last several years, the U.S. government has shut down several times and certain regulatory agencies, such as the FDA and the SEC, have had to furlough critical FDA, SEC and other government employees and stop critical activities. In addition, there have recently been terminations of large numbers of federal employees at various federal agencies, including the FDA. Changes and cuts in FDA staffing could result in delays in the FDA’s responsiveness or in its ability to review IND submissions or applications, issue regulations or guidance, or implement or enforce regulatory requirements in a timely fashion, or at all. A prolonged government shutdown occurs and/or employee terminations or resignations could significantly impact the ability of the FDA or other federal agencies to timely review and process our regulatory submissions, which could have a material adverse effect on our business. Further, future government shutdowns and/or employee terminations or resignations at the SEC could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.
There is substantial uncertainty as to whether and how the current administration will seek to modify or revise the requirements and policies of the FDA and other regulatory agencies with jurisdiction over our product candidates and any products for which we obtain approval. This uncertainty could present new challenges as we navigate development and approval of our product candidates. Some of these efforts have manifested to date in the form of personnel cuts and measures that could impact the FDA’s ability to hire and retain key personnel, which could result in delays or limitations on our ability to obtain guidance from the FDA on our product candidates in development and obtain the requisite regulatory approvals in the future. There is uncertainty as to whether we will be materially and negatively impacted by governmental orders, regulations, policies or guidance, or disruptions to the normal operations of government agencies.
Disruptions at the FDA and other foreign regulatory authorities may also slow the time necessary for new biologics to be reviewed and/or approved by necessary foreign regulatory authorities, which would adversely affect our business. For example, over the last several years the U.S. government has shut down several times and certain regulatory authorities, such as the FDA, have had to furlough critical FDA employees and stop critical activities. If a prolonged government shutdown occurs, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business.
Separately, the FDA and regulatory authorities outside the United States have and may adopt restrictions or other policy measures in response to public health crises that divert resources and delay their attention from any submissions we may make. If a prolonged government shutdown occurs, or if global health concerns continue to prevent the FDA or other foreign regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other foreign regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.
We rely on third parties to conduct, supervise, and/or monitor our ongoing and planned clinical trials and perform some of our research and preclinical studies. If these third parties do not satisfactorily carry out their contractual duties or fail to meet expected deadlines, our development programs may be delayed or subject to increased costs, each of which may have an adverse effect on our business and prospects.
There is no guarantee that any such CROs, clinical trial investigators or other third parties on which we rely will devote adequate time and resources to our development activities or perform as contractually required. If any of these third parties fail to meet expected deadlines, adhere to our clinical protocols or meet regulatory requirements, otherwise performs in a substandard manner, or terminates its engagement with us, the timelines for our development programs may be extended or delayed or our development activities may be suspended or terminated.
There is no guarantee that any such CROs, clinical trial investigators or other third parties on which we rely will devote adequate time and resources to our development activities or perform as contractually required. If any of these third parties fail to meet expected deadlines, adhere to our clinical protocols or meet regulatory requirements, otherwise performs in a substandard manner, or terminates its engagement with us, the timelines for our development programs may be extended or delayed or our development activities may be suspended or terminated. If any of our clinical trial sites terminates for any reason, we may experience the loss of follow-up information on subjects enrolled in such clinical trials unless we are able to transfer those subjects to another qualified clinical trial site, which may be difficult or impossible. In addition, clinical trial investigators for our clinical trials may serve as scientific advisors or consultants to us from time to time and may receive cash or equity compensation in connection with such services. If these relationships and any related compensation result in perceived or actual conflicts of interest, or the FDA, the EMA or any comparable foreign regulatory authority concludes that the financial relationship may have affected the interpretation of the trial, the integrity of the data generated at the applicable clinical trial site may be questioned and the utility of the clinical trial itself may be jeopardized, which could result in the delay or rejection of any marketing authorization application we submit by the FDA, the EMA or any comparable foreign regulatory authority. Any such delay or rejection could prevent us from commercializing our product candidates.
Further, the U.S. government, state legislatures and foreign governments have shown increased interest in implementing cost containment programs to limit government-paid health care costs, including price controls, restrictions on reimbursement and requirements for substitution of generic products. For example, HHS imposes rebates on many Medicare Part B and Medicare Part D products to penalize price increases that outpace inflation on an annual basis. HHS has also been empowered to negotiate the price of certain single-source biologics that have been on the market for at least eleven years covered under Medicare as part of the Medicare Drug Price Negotiation Program. Each year up to twenty products will be selected by HHS for the Medicare Drug Price Negotiation Program. Products subject to the Medicare Drug Price Negotiation Program are expected to experience a significant reduction in reimbursement from the Medicare program on a per unit basis.
Our existing collaborationcollaborations with Merck isand BMS are important to our business. If Merckour ceasescollaborators cease development efforts under our existing or future collaboration agreements, or if any of those agreements are terminated, these collaborations may fail to lead to commercial products and we may never receive milestone payments or future royalties under these agreements.
We have entered into collaborationcollaborations with Merck and BMS to develop certain specified product candidates. All of our revenue to date has been derived from our existing collaboration agreementagreements with Merck,Merck and BMS, and a significant portion of our near-term future revenue is expected to be derived from thisthese agreementagreements or other similar agreements into which we may enter in the future. Revenue from research and development collaborations depends upon continuation of the collaborations, payments for research and development services and product supply, and the achievement of milestones, contingent payments and royalties, if any, derived from future products developed from our research. If we are unable to successfully advance the development of our product candidates or achieve milestones, revenue and cash resources from milestone payments under our collaboration agreementagreements will be substantially less than expected.
We have entered into a research collaboration and exclusive license agreementagreements with Merck and BMS and in the future may seek and form strategic alliances, create joint ventures or additional collaborations, or enter into acquisitions or licensing arrangements with third parties that we believe will complement or augment our existing technologies and product candidates.
The development and commercialization of new products is highly competitive. We largely compete in the segments of the pharmaceutical, biotechnology and other related markets that develop immunotherapies for the treatment of cancer.cancer and autoimmune disease. Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient, or are less expensive than any products that we may develop. Our competitors also may obtain FDA, European Commission, or other regulatory approval for their products more rapidly than we may obtain approval for ours, if ever, which could result in our competitors establishing a strong market position before we are able to enter the market or make our development more complicated. Moreover, with the proliferation of new drugs and therapies into oncology,oncology and autoimmune disease, we expect to face increasingly intense competition as new technologies become available. If we fail to stay at the forefront of technological change, we may be unable to compete effectively. Any product candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future. The highly competitive nature of and rapid technological changes in the biotechnology and pharmaceutical industries could render our product candidates or our technology obsolete, less competitive or uneconomical.
Specifically, there are many companies pursuing a variety of approaches to immuno-oncology and autoimmune disease treatments, including large pharmaceutical and biotechnology companies, such as AbbVie, Amgen, AstraZeneca, BeiGene,Biogene, Bristol Myers Squibb, Eli Lilly, Gilead, GlaxoSmithKline, Johnson & Johnson, Eli Lilly, Merck & Co., Novartis, Pfizer, Regeneron, Roche/Genentech, Sanofi, Takeda and Xencor. Other companies using PSMA-targeting therapeutics for the treatment of cancer include AbbVie, Amgen, AstraZeneca, Bayer, Crescendo Biologics, Eli Lilly, GlaxoSmithKline, Johnson and Johnson, Lantheus, Lava Therapeutics, Novartis, Regeneron and Vir Biotechnology. We also face competition from biologic prodrug developers such as Adagene, Chugai Pharmaceutical Co./Roche Holding AG, CytomX Therapeutics, Merck & Co., Takeda and Vir Biotechnology.
In addition, under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended (the Code), and corresponding provisions of state law, if a corporation undergoes an “ownership change,” which is generally defined as a greater than 50 percentage point change (by value) in its equity ownership over a rolling three-year period, the corporation’s ability to use its pre-change NOL carryforwards and certain other tax attributes to offset its post-change income or taxes may be limited. This could limit the amount of NOL carryforwards or other applicable tax attributes that we can utilize annually to offset future taxable income or tax liabilities. Subsequent ownership changes and changes to the U.S. tax rules in respect of the utilization of NOLs and other applicable tax attributes carried forward may further affect the limitation in future years. We have not undertaken a Section 382 study, and it is possible that we have previously undergone one or more ownership changes so that our use of net operating loss carryforwards is subject to limitation. We may experience ownership changes in the future as a result of subsequent shifts in our stock ownership. As a result, if we earn net taxable income, our ability to use our pre-change NOL carryforwards to offset U.S. federal taxable income may be subject to limitations, which could potentially result in increased future tax liability to us. In addition, at the state level, there may be periods during which the use of NOL carryforwards is suspended or otherwise limited, which could accelerate or permanently increase state taxes owed. For example, California imposed limits on the usability of California state net operating losses to offset taxable income in tax years beginning after 2023 and before 2027. As a result, we may be unable to use all or a material portion of our NOL carryforwards and other tax attributes, which could adversely affect our future cash flows.
For example, California imposed limits on the usability of California state net operating losses to offset taxable income in tax years beginning after 2023 and before 2027.As a result, we may be unable to use all or a material portion of our NOL carryforwards and other tax attributes, which could adversely affect our future cash flows.
analogous state laws and regulations, including: state anti-kickback and false claims laws, which may apply to our business practices, including, but not limited to, research, distribution, sales and marketing arrangements and claims involving healthcare items or services reimbursed by any third-party payor, including private insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S. federal government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws and regulations that require drug manufacturers to file reports relating to pricing and marketing information, which requires tracking gifts and other remuneration and items of value provided to healthcare professionals and entities; and state and local laws requiring certain regulatory licenses to manufacture or distribute pharmaceutical products commercially and/or the registration of pharmaceutical sales representatives; and European Union and other foreign law equivalents of each of the laws, including reporting requirements detailing interactions with and payments to healthcare providers.
In March 2010, the Affordable Care Act was enacted, which includes measures that have significantly changed the way health care is financed by both governmental and private insurers. There have been executive, judicial and congressional challenges and amendments to certain aspects of the Affordable Care Act. For example, on July 4, 2025, the One Big Beautiful Bill Act (the OBBBA) was signed into law, which narrowed access to Affordable Care Act marketplace exchange enrollment and declined to extend the Affordable Care Act enhanced advanced premium tax credits that expired at the end of 2025, which, among other provisions in the law, are anticipated to reduce the number of Americans with health insurance. The OBBBA also is expected to reduce Medicaid spending and enrollment by implementing work requirements for some beneficiaries, capping state-directed payments, reducing federal funding, and limiting provider taxes used to fund the program. Congress is considering proposed legislation intended to further reduce healthcare costs with alternatives to replace the expired Affordable Care Act subsidies.
In March 2010, the Affordable Care Act was enacted, which includes measures that have significantly changed the way health care is financed by both governmental and private insurers. There have been executive, judicial and congressional challenges and amendments to certain aspects of the Affordable Care Act. For example, on August 16, 2022, the Inflation Reduction Act of 2022 (IRA) was signed into law, which among other things, extends enhanced subsidies for individuals purchasing health insurance coverage in Affordable Care Act marketplaces through plan year 2025. The IRA also eliminates the “donut hole” under the Medicare Part D program beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost and through a newly established manufacturer discount program. It is also unclear how any additional healthcare reform measures of the second Trump administration will impact the Affordable Care Act or our business.
In addition, other legislative changes have been proposed and adopted since the Affordable Care Act was enacted. ForThese example,changes in August 2011, the Budget Control Act of 2011 was signed into law, which, among other things, includedinclude aggregate reductions to Medicare payments to providers of, on average,of 2% per fiscal yearyear, which began in 2013 and will remain in effect until 2032.2032 Additionally,unless onadditional MarchCongressional 11,action 2021,is the American Rescue Plan Act of 2021 was signed into law, which eliminated the statutory Medicaid drug rebate cap, previously set at 100% of a drug’s average manufacturer price, for single source and innovator multiple source drugs, effective January 1, 2024.taken.
The current administration is pursuing policies to reduce regulations and expenditures across government agencies including at HHS, the FDA, CMS and related agencies. These actions, presently directed by executive orders or memoranda from the Office of Management and Budget, may propose policy changes that create additional uncertainty for our business. For example, the current administration has announced agreements with several pharmaceutical companies that require the drug manufacturers to offer, through a direct to consumer platform (TrumpRx), U.S. patients and Medicaid programs prescription drug Most-Favored Nation pricing equal to or lower than those paid in other developed nations, with additional mandates for direct-to-patient discounts and repatriation of foreign revenues. Other recent actions, for example, include (1) directing agencies to reduce agency workforce and cut programs; (2) directing HHS and other agencies to lower prescription drug costs through a variety of initiatives; (3) imposing tariffs on imported pharmaceutical products; and (4) as part of the Make America Healthy Again (MAHA) Commission’s Strategy Report released in September 2025, working across government agencies to increase enforcement on direct-to-consumer pharmaceutical advertising. Additionally, the current administration recently called on Congress to enact "The Great Healthcare Plan," to codify and expand Most-Favored Nation pricing, lower government subsidies to private insurance companies, increase healthcare price transparency, expand pharmaceutical drugs available for over-the-counter purchase, and enact restrictions on pharmacy benefit manager (PBM) payment methodologies, among other things. These actions and policies may significantly reduce U.S. drug prices, potentially impacting manufacturers’ global pricing strategies and profitability, while increasing their operational costs and compliance risks. In June 2024, the U.S. Supreme Court’s Loper Bright decision greatly reduced judicial deference to regulatory agencies, which could increase successful legal challenges to federal regulations affecting our operations. Congress may introduce and ultimately pass health care related legislation that could impact the drug approval process and make changes to the Medicare Drug Price Negotiation Program. We expect that additional U.S. federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that the U.S. federal government will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures.
Recently, there has been increasing legislative and enforcement interest in the United States with respect to specialty drug pricing practices. Specifically, there have been several U.S. presidential executive orders, congressional inquiries and legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under Medicare, review the relationship between pricing and manufacturer patient programs and reform government program reimbursement methodologies for drugs. For example, the IRA, among other things, (1) directs the U.S. Department of Health and Human Services (HHS) to negotiate the price of certain high-expenditure single-source biologics that have been on the market for at least 11 years covered under Medicare (the Medicare Drug Price Negotiation Program) and (2) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation. These provisions began to take effect progressively in fiscal year 2023. On August 15, 2024, HHS announced the agreed-upon prices of the first ten drugs that were subject to price negotiations, although the Medicare Drug Price Negotiation Program is currently subject to legal challenges. On January 17, 2024, HHS selected fifteen additional products covered under Part D for price negotiation in 2025. Each year thereafter more Part B and Part D products will become subject to the Medicare Drug Price Negotiation Program. Further, on December 7, 2023, an initiative to control the price of prescription drugs through the use of march-in rights under the Bayh-Dole Act was announced. On December 8, 2023, the National Institute of Standards and Technology published for comment a Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights which for the first time includes the price of a product as one factor an agency can use when deciding to exercise march-in rights. While march-in rights have not previously been exercised, it is uncertain if that will continue under the new framework. At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control costs pharmaceutical and biological products. Moreover, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs.
We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad. For example, the regulatory landscape related to clinical trials in the EU has undergone recent changes. The EU Clinical Trials Regulation, or CTR, which was adopted in April 2014 and repeals the EU Clinical Trials Directive, became effective on January 31, 2022. The CTR permits trial sponsors to make a single submission to both the competent authority and an ethics committee in each EU Member State, leading to a single decision for each EU Member State. The assessment procedure for the authorization of clinical trials has been harmonized as well, including a joint assessment of some elements of the application by all EU Member States in which the trial is to be conducted, and a separate assessment by each EU Member State with respect to specific requirements related to its own territory, including ethics rules. Each EU Member State’s decision is communicated to the sponsor through a centralized EU portal, the Clinical Trial Information System, or CTIS. The CTR provides a three-year transition period. The extent to which ongoing clinical trials will be governed by the CTR varies. For clinical trials in relation to which an application for approval was made on the basis of the Clinical Trials Directive before January 31, 2023, the CTD will continue to apply on a transitional basis until January 31, 2025. By that date, all ongoing trials will become subject to the provisions of the CTR. The CTR foresaw a three-year transition period that ended on January 31, 2025. Since this date, all new or ongoing trials are subject to the provisions of the CTR.InCTR. In the European Union, many EU Member States periodically review their reimbursement procedures for medicinal products, which could have an adverse impact on reimbursement status. Moreover, in order to obtain reimbursement for our products in some European countries, including some EU Member States, we may be required to compile additional data comparing the cost-effectiveness of our products to other available therapies. This Health Technology Assessment (“HTA”) of medicinal products is becoming an increasingly common part of the pricing and reimbursement procedures in some EU Member States, including those representing the larger markets. The HTA process is the procedure to assess therapeutic, economic and societal impact of a given medicinal product in the national healthcare systems of the individual country. The outcome of an HTA will often influence the pricing and reimbursement status granted to these medicinal products by the competent authorities of individual EU Member States. The extent to which pricing and reimbursement decisions are influenced by the HTA of the specific medicinal product currently varies between EU Member States. InOn DecemberJanuary 2021,12, Regulation No 2021/2282 on HTA, was adopted in2025, the EU.HTA This Regulation, whichRegulation entered into application on January 12, 2025 and hasthrough a phased implementation,implementation. The HTA Regulation is intended to boost cooperation among EU Member States in assessing health technologies, including new medicinal products, and providingestablishes the basisframework for cooperation at EU level for joint clinical assessmentsassessments, injoint thesescientific areas.consultations and early identification of emerging health technologies. The HTA Regulation permits EU Member States to use common HTA tools, methodologies,methodologies and procedures across the EU, workingand togetherrequires inthem fourto mainrely areas,on includingEU level joint clinical assessment ofreports for the innovativeclinical healthcomponents technologiesof withtheir the most potential impact for patients, joint scientific consultations whereby developers can seek advice fromnational HTA authorities, identification of emerging health technologies to identify promising technologies early, and continuing voluntary cooperation in other areas.evaluations. Individual EU Member States continue to be responsible for assessing non-clinical (e.g., economic, social, ethical) aspects of health technologies,technologies and making decisions on pricing and reimbursement.
In addition, on December 11, 2025, the European Commission, the Parliament and the European Council reached a political agreement on the Pharma Package. The reform has been under negotiation since the European Commission submitted its proposal in April 2023. This package, comprised of a new directive and regulation to replace existing legislation, aims to modernize the EU framework. The political agreement is still subject to formal approval by the European Parliament and Council. If approved in the form proposed, the Pharma Package will, among other changes, reduce the baseline market protection period by one year, with limited opportunities for extensions; reshape the incentives regime for orphan medicinal products; and expand the Bolar exemption, a patent-related regulatory safe harbor, to permit generic and biosimilar manufacturers to conduct preparatory activities for regulatory submissions, including pricing and reimbursement, and participate in procurement tenders while patent protection remains in force. A decrease in market exclusivity opportunities for our product candidates in the EU, combined with the expanded Bolar exemption, could open them to generic or biosimilar competition earlier than under the current regime, potentially impacting reimbursement status and the commercial prospects of our product candidates.
In addition, on April 26, 2023, the European Commission adopted a proposal for a new Directive and Regulation to revise the existing pharmaceutical legislation and on April 10, 2024, the European Union Parliament adopted its related position. The proposed revisions remain to be agreed and adopted by the European Council. Moreover, on December 1, 2024, a new European Commission took office. The proposal could, therefore, still be subject to revisions. If adopted in the form proposed, the recent European Commission proposals to revise the existing EU laws governing authorization of medicinal products may result in a number of changes to the regulatory framework governing medicinal products, including a decrease in data and market exclusivity opportunities for our product candidates in the EU.
We expect that the healthcare reform measures that have been adopted, and that may be adopted in the future, particularly in light of the recent U.S. Presidential and Congressional elections, may result in more rigorous coverage criteria and in additional downward pressure on the price that we receive for any approved product and could seriously harm our future revenues. Any reduction in reimbursement from Medicare or other comparable government programs may result in a similar reduction in payments from private payors. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability or commercialize our products.
The United Kingdom’s withdrawal from the European Union may have a negative effect on global economic conditions, financial markets and our business, which could reduce the price of our common stock.
The United Kingdom’s, or UK, withdrawal from the EU on January 31, 2020, commonly referred to as Brexit, has changed the regulatory relationship between the UK and the EU. The Medicines and Healthcare products Regulatory Agency, or MHRA, is now the UK’s standalone regulator for medicinal products and medical devices. The United Kingdom is now a third country to the EU.
The UK regulatory framework in relation to clinical trials is governed by the Medicines for Human Use (Clinical Trials) Regulations 2004, as amended, which is derived from the CTD, as implemented into UK national law through secondary legislation. On January 17, 2022, the MHRA launched an eight-week consultation on reframing the UK legislation for clinical trials, and which aimed to streamline clinical trials approvals, enable innovation, enhance clinical trials transparency, enable greater risk proportionality, and promote patient and public involvement in clinical trials. The UK Government published its response to the consultation on March 21, 2023 confirming that it would bring forward changes to the legislation and such changes were laid in parliament on December 12, 2024. These resulting legislative amendments will, if implemented in their current form, bring the UK into closer alignment the CTR. In October 2023, the MHRA announced a new Notification Scheme for clinical trials which enables a more streamlined and risk-proportionate approach to initial clinical trial applications for Phase 4 and low-risk Phase 3 clinical trial applications.
Marketing authorizations in the UK are governed by the Human Medicines Regulations (SI 2012/1916), as amended. Since January 1, 2021, an applicant for the EU centralized procedure marketing authorization can no longer be established in the UK. As a result, since this date, companies established in the UK cannot use the EU centralized procedure and instead must follow one of the UK national authorization procedures or one of the remaining post-Brexit international cooperation procedures. Applications are governed by the Human Medicines Regulations (SI 2012/1916) and are made electronically through the MHRA Submissions Portal. The MHRA has introduced changes to national licensing procedures, including procedures to prioritize access to new medicines that will benefit patients, a 150-day assessment (subject to clock-stops) and a rolling review procedure. The rolling-review procedure permits the separate or joint submission of quality, non-clinical, and clinical data to the MHRA which can be reviewed on a rolling basis. After an application under the rolling-review procedure has been validated, the decision should be received within 100 days (subject to clock-stops).
In addition, since January 1, 2024, the MHRA may rely on the International Recognition Procedure (“IRP”), when reviewing certain types of MAAs. Pursuant to the IRP, the MHRA will take into account the expertise and decision-making of trusted regulatory partners (e.g., the regulatory in Australia, Canada, Switzerland, Singapore, Japan, the U.S.A. and the EU). The MHRA will conduct a targeted assessment of IRP applications but retain the authority to reject applications if the evidence provided is considered insufficiently robust. The IRP allows medicinal products approved by such trusted regulatory partners that meet certain criteria to undergo a fast-tracked MHRA review to obtain and/or update a MA in the United Kingdom. Applications should be decided within a maximum of 60 days if there are no major objections identified that cannot be resolved within such 60 day period and the approval from the trusted regulatory partner selected has been granted within the previous 2 years or if there are such major objections identified or such approval hasn’t been granted within the previous 2 years within 110 days. Applicants can submit initial MAAs to the IRP but the procedure can also be used throughout the lifecycle of a product for post-authorization procedures including line extensions, variations and renewals.
All existing EU marketing authorizations for centrally authorized products were automatically converted or grandfathered into the UK’s marketing authorization, effective in Great Britain only, free of charge on January 1, 2021, unless the marketing authorization holder opted-out of this possibility. Northern Ireland remained within the scope of authorizations of the EU in relation to centrally authorized medicinal products until January 1, 2025. However, on January 1, 2025, a new arrangement as part of the so-called “Windsor Framework” came into effect and reintegrated Northern Ireland under the regulatory authority of the MHRA with respect to medicinal products.
The Windsor Framework removes EU licensing processes and EU labelling and serialization requirements in relation to Northern Ireland and introduces a UK-wide licensing process for medicines. There is no pre-marketing authorization orphan designation for medicinal products in the UK. Instead, the MHRA reviews applications for orphan designation in parallel to the corresponding marketing authorization application. The criteria are essentially the same as those in the EU, but have been tailored for the market. This includes the criterion that prevalence of the condition in the UK, rather than the EU, must not be more than five in 10,000. Upon the grant of a marketing authorization with orphan status, the medicinal product will benefit from up to 10 years of market exclusivity from similar products in the approved orphan indication. The start of this market exclusivity period will be set from the date of first approval of the product in the UK.
If there is no lawful manner for us to transfer personal data from the EEA, the UK or other jurisdictions to the United States, or if the requirements for a legally-compliant transfer are too onerous, we could face significant adverse consequences, including the interruption or degradation of our operations, the need to relocate part of or all of our business or data processing activities to other jurisdictions (such as Europe) at significant expense, increased exposure to regulatory actions, substantial fines and penalties, the inability to transfer data and work with partners, vendors and other third parties, and injunctions against our processing or transferring of personal data necessary to operate our business. Additionally, companies that transfer personal data out of the EEA and UK to other jurisdictions, particularly to the United States, are subject to increased scrutiny from regulators, individual litigants, and activist groups. Some European regulators have ordered certain companies to suspend or permanently cease certain transfers out of Europe for allegedly violating the GDPR’s cross-border data transfer limitations. Regulators in the United States are also increasingly scrutinizing certain personal data transfers and may impose data localization requirements, for example, the Biden Administration’s executive order Preventing Access to Americans’ Bulk Sensitive Personal Data and United States Government-Related Data by Countries of Concern.
Additionally, the U.S. Department of Justice issued a rule titled The Preventing Access to Americans’ Bulk Sensitive Personal Data and United States Government-Related Data by Countries of Concern, which places additional restrictions on certain data transactions involving countries of concern (e.g., China, Russia, and Iran) and covered persons (i.e., individuals and entities who are designated as such by the U.S. Attorney General or considered “foreign persons” and are majority owned by, organized under the laws of, a primary resident in, or a contractor of, a covered personal or country of concern, as applicable) that impacts certain business activities such as vendor engagements, sale or sharing of data, employment of certain individuals, and investor agreements. Violations of this rule could lead to significant civil and criminal fines and penalties. The rule applies regardless of whether data is anonymized, key-coded, pseudonymized, de-identified or encrypted, which presents particular challenges for companies like ours that process key-coded clinical trial data and biospecimens.
International trade policies, including tariffs, sanctions and trade barriers may adversely affect our business, financial condition, results of operations and prospects.
We operate in a global economy, which includes utilizing third-party suppliers in several countries outside the United States. There is inherent risk, based on the complex relationships among the U.S. and the countries in which we conduct our business, that political, diplomatic, and national security factors can lead to global trade restrictions and changes in trade policies and export regulations that may adversely affect our business and operations. The current international trade and regulatory environment is subject to significant ongoing uncertainty. The U.S. government has recently announced substantial new tariffs affecting a wide range of products and jurisdictions and has indicated an intention to continue developing new trade policies, including with respect to the pharmaceutical industry. In response, certain foreign governments have announced or implemented retaliatory tariffs and other protectionist measures. These developments have created a dynamic and unpredictable trade landscape, which may adversely impact our business, results of operations, financial condition and prospects.
We do not own or operate, and currently have no plans to establish, any manufacturing facilities. We currently rely, and expect to continue to rely, on third parties for the manufacture of our product candidates for clinical testing, as well as for manufacture of any products that we may commercialize, if approved. Currently, several of our suppliers are located outside of the United States, and our principal supplier of critical biological materials, WuXi Biologics, is located in China. We also rely on specialized laboratory equipment, supplies, materials, and precursor compounds, all or part of which we believe may be ultimately sourced from multiple countries outside the United States, to advance our research and development efforts.
Current or future tariffs will result in increased research and development expenses, including with respect to increased costs associated with biological materials, laboratory equipment and research materials and components. In addition, such tariffs will increase our supply chain complexity and could also potentially disrupt our existing supply chain. Trade restrictions affecting the import of materials necessary for clinical trials could result in delays to our development timelines. Increased development costs and extended development timelines could place us at a competitive disadvantage compared to companies operating in regions with more favorable trade relationships and could reduce investor confidence, negatively impacting our ability to secure additional financing on favorable terms or at all. In addition, as we advance toward commercialization in the future, tariffs and trade restrictions could hinder our ability to establish cost-effective production capabilities, negatively impacting our growth prospects.
The complexity of announced or future tariffs may also increase the risk that we or our customers or suppliers may be subject to civil or criminal enforcement actions in the United States or foreign jurisdictions related to compliance with trade regulations. Foreign governments may also adopt non-tariff measures, such as procurement preferences or informal disincentives to engage with, purchase from or invest in U.S. entities, which may limit our ability to compete internationally and attract non-U.S. investment, employees, customers and suppliers. Foreign governments may also take other retaliatory actions against U.S. entities, such as decreased intellectual property protection, increased enforcement actions, or delays in regulatory approvals, which may result in heightened international legal and operational risks. In addition, the United States and other governments have imposed and may continue to impose additional sanctions, such as trade restrictions or trade barriers, which could restrict us from doing business directly or indirectly in or with certain countries or parties and may impose additional costs and complexity to our business.
Trade disputes, tariffs, restrictions and other political tensions between the United States and other countries may also exacerbate unfavorable macroeconomic conditions including inflationary pressures, foreign exchange volatility, financial market instability, and economic recessions or downturns. The ultimate impact of current or future tariffs and trade restrictions remains uncertain and could materially and adversely affect our business, financial condition, and prospects. While we actively monitor these risks, any prolonged economic downturn, escalation in trade tensions, or deterioration in international perception of U.S.-based companies could materially and adversely affect our business, ability to access the capital markets or other financing sources, results of operations, financial condition and prospects. In addition, tariffs and other trade developments have and may continue to heighten the risks related to the other risk factors described elsewhere in this Annual Report.
The patent position of biopharmaceutical companies generally is highly uncertain, involves complex legal and factual questions and has in recent years been the subject of much litigation, resulting in court decisions, including Supreme Court decisions, which have increased uncertainties as to the ability to enforce patent rights in the future.
The patent position of biopharmaceutical companies generally is highly uncertain, involves complex legal and factual questions and has in recent years been the subject of much litigation, resulting in court decisions, including Supreme Court decisions, which have increased uncertainties as to the ability to enforce patent rights in the future. In addition, the laws of foreign countries may not protect our rights to the same extent as the laws of the United States, or vice versa. European applications now have the option, upon grant of a patent, of becoming a Unitary Patent which will be subject to the jurisdiction of the Unitary Patent Court (UPC). This is a significant change in European patent practice. As the UPC is a new court system, there is no precedent for the court, increasing the uncertainty of any litigation.
Geopolitical actions in the United States and in foreign countries could increase the uncertainties and costs surrounding the prosecution or maintenance of our patent applications or those of any current or future licensors and the maintenance, enforcement or defense of our issued patents or those of any current or future licensors. For example, the United States and foreign government actions related to the military conflict in Ukraine and Russia may limit or prevent filing, prosecution and maintenance of patent applications in Russia. Government actions may also prevent maintenance of issued patents in Russia. These actions could result in abandonment or lapse of our patents or patent applications, resulting in partial or complete loss of patent rights in Russia. If such an event were to occur, it could have a material adverse effect on our business. In addition, a decree was adopted by the Russian government in March 2022, allowing Russian companies and individuals to exploit inventions owned by patentees that have citizenship or nationality in, are registered in, or have predominately primary place of business or profit-making activities in the United States and other countries that Russia has deemed unfriendly without consent or compensation. Consequently, we would not be able to prevent third parties from practicing our inventions in Russia or from selling or importing products made using our inventions in and into Russia. Accordingly, our competitive position may be impaired, and our business, financial condition, results of operations and prospects may be adversely affected.
In addition to the protection afforded by patents, we rely on trade secret protection and confidentiality agreements to protect proprietary know-how that is not patentable, processes for which patents are difficult to enforce and any other elements of our discovery and development processes that involve proprietary know-how, information or technology that is not covered by patents. We may also rely on trade secret protection as temporary protection for concepts that may be included in a future patent filing. However, trade secret protection will not protect us from innovations that a competitor develops independently of our proprietary know how. If a competitor independently develops a technology that we protect as a trade secret and files a patent application on that technology, then we may not be able to patent that technology in the future, may require a license from the competitor to use our own know-how, and if the license is not available on commercially-viable terms, then we may not be able to launch our product. Although we require all of our employees to assign their inventions to us, and require all of our employees, consultants, advisors and any third parties who have access to our proprietary know-how, information or technology to enter into confidentiality agreements, we cannot be certain that our trade secrets and other confidential proprietary information will not be disclosed or that competitors will not otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques. Furthermore, the laws of some foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the United States. As a result, we may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad. If we are unable to prevent unauthorized material disclosure of our intellectual property to third parties, we will not be able to establish or maintain a competitive advantage in our market, and this scenario could materially adversely affect our business, financial condition and results of operations.
Furthermore, the laws of some foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the United States. As a result, we may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad. If we are unable to prevent unauthorized material disclosure of our intellectual property to third parties, we will not be able to establish or maintain a competitive advantage in our market, and this scenario could materially adversely affect our business, financial condition and results of operations.
unanticipated serious safety concerns related to immuno-oncologyimmunotherapy or related to the use of our product candidates;
In addition, the stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many immuno-oncologyimmunotherapy companies. Stock prices of many immuno-oncologyimmunotherapy companies have fluctuated in a manner unrelated or disproportionate to the operating performance of those companies.
New income, sales, use, or other tax laws, statutes, rules, regulations or ordinances could be enacted at any time, which could adversely affect our business operations and financial performance. Further, existing tax laws, statutes, rules, regulations, or ordinances could be interpreted, changed, modified, or applied adversely to us. ForThe example,OBBBA, the Tax Act,IRA, the Coronavirus Aid, Relief, and Economic Security Act and legislation commonly referred to as the IRATax enactedCuts and Jobs Act made many significant changes to the U.S. tax laws. EffectiveFor January 1, 2022,example, the Tax Cuts and Jobs Act eliminatedrequired the optiontaxpayers to deductcapitalize and amortize U.S.-based and non-U.S. based research and developmentexperimental expenses(R&E) forexpenditures taxover purposesfive and fifteen years, respectively. The OBBBA restored the deductibility of domestic R&E expenditures in the year incurred andfor requires taxpayers to capitalize and subsequently amortize such expenses over fivetax years forbeginning researchafter activitiesDecember conducted31, in2024, thebut United States and over 15 years for research activities conducted outside the United States. Although there have been legislative proposals to repeal or deferretained the capitalization and amortization requirement tofor laterforeign years,R&E there can be no assurance that the provision will be repealed or otherwise modified.expenditures. Future guidance from the Internal Revenue Service and other tax authorities with respect to suchany legislation may affect us, and certain aspects of such legislation could be repealed or modified or sunset in future legislation.years. In addition, it is uncertain if and to what extent various states will conform to federal tax laws. Future tax reform legislation could have a material impact on the value of our deferred tax assets, could result in significant one-time charges, and could increase our future U.S. tax expense.
While we have implemented security measures designed to protect against security incidents, there can be no assurance that these measures will be effective. We take steps designed to detect, mitigate and remediate vulnerabilities in our information security systems (such as our hardware and/or software, including that of third parties with whom we work), but we have not been and may not be able to detect, mitigate, and remediate all such vulnerabilities including on a timely basis. It may also be difficult and/or costly to detect, investigate, mitigate, contain, and remediate a security incident. Further, we may experience delays in developing and deploying remedial measures designed to address any such identified vulnerabilities. Vulnerabilities could be exploited and result in a security incident. Actions taken by us or the third parties with whom we work to detect, investigate, mitigate, contain, and remediate a security incident could result in outages, data losses, and disruptions of our business. Threat actors may also gain access to other networks and systems after a compromise of our networks and systems. For example, threat actors may use an initial compromise of one part of our environment to gain access to other parts of our environment, or leverage a compromise of our networks or systems to gain access to the networks or systems of third parties with whom we work, such as through phishing or supply chain attacks.
Management's Discussion & Analysis (MD&A)
Removed heading “Support Services Agreement with Avalon BioVentures, Inc. (formerly COI Pharmaceuticals, Inc.)”
Largest changes
the effects of the disruptions to and volatility in the credit and financial markets in the United States and worldwide resulting from geopolitical and macroeconomic conditions, including recent and changing tariff policy announcements, tariffs, trade tensions and retaliatory measures by other countries, supply chain disruptions, recession risks, the military conflict in Ukraine and Russia, the war in the Middle East, epidemics and bank failures; and the costs of operating as a public company.see in full comparison
Global economic and business activities continue to face widespread geopolitical and macroeconomic uncertainties, including those associated with public health crises, bank failures, inflation and monetary supply shifts, recent and changing tariff policy announcements, tariffs, trade tensions and retaliatory measures by other countries, supply chain disruptions, recession risks and potential disruptions from the Russia-Ukraine conflict, the war in the Middle East and related sanctions.see in full comparisonFor example, in 2023, the Federal Deposit Insurance Corporation took control and was appointed receiver of certain financial institutions. If other banks and financial institutions enter receivership or become insolvent in the future in response to financial conditions affecting the banking system and financial markets, our ability to access our existing cash, cash equivalents and investments may be threatened and could have a material adverse effect on our business and financial condition.Inflation generally affects us by increasing our salaries and fees paid to third-party contract service providers. We have considered potential impacts arising from the risks and uncertainties as described above and have not experienced any material disruption to our operations to date.
“Support Services Agreement with Avalon BioVentures, Inc. (formerly COI Pharmaceuticals, Inc.)”see in full comparison
“Net cash used in investing activities of $258.0 million for the year ended December 31, 2024 was primarily due to $257.7 million of net purchases of short-term investments and by our purchase of property and equipment, primarily consisting of laboratory equipment of $0.3 million. Net cash used in investing activities of $41.2 million for the year ended December 31, 2023 was primarily due to $39.3 million of net purchases of short-term investments and by our purchase of property and equipment, primarily consisting of laboratory equipment of $1.9 million.”see in full comparison
“Net cash used in investing activities of $301.0 million for the year ended December 31, 2025 was primarily due to $300.0 million of net purchases of short-term investments and our purchase of property and equipment, primarily consisting of laboratory equipment of $1.0 million. Net cash used in investing activities of $258.0 million for the year ended December 31, 2024 was primarily due to $257.7 million of net purchases of short-term investments and our purchase of property and equipment, primarily consisting of laboratory equipment of $0.3 million.”see in full comparison
Collaboration revenues weresee in full comparison$10.6$10.0 million and$8.1$10.6 million for the years ended December 31,20242025 and2023,2024, respectively. Theincreasedecrease of$2.5$0.6 million was primarily due to an increase in milestone revenue under theachievementMerck Agreement, offset by the completion ofaourdevelopmentalresearchmilestone related to the First Collaboration Targetactivities under the Merck Agreement inJuneAugust2024 offset by a decrease in full-time equivalent hours incurred in the performance of research services required under the Merck Agreement.2024.
Full comparison: every changed paragraph (25)
You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes included in “Item 8. Financial Statements and Supplementary Data” in this Annual Report on Form 10-K. The following discussion contains forward-looking statements that involve risks and uncertainties. For a complete discussion of forward-looking statements, see the section above entitled “Special Note Regarding Forward Looking Statements.” Our actual results could differ materially from those expressed or implied in any forward-looking statements as a result of various factors, including those set forth under the caption “Item 1A. Risk Factors.”
Additionally, our discussion and analysis below are focused on our financial results and liquidity and capital resources for the years ended December 31, 20242025 and 2023,2024, including year-over-year comparisons of our financial performance and condition for these years. Discussion and analysis of the year ended December 31, 20222023 specifically, as well as the year-over-year comparison of our financial performance and condition for the years ended December 31, 20232024 and 2022,2023, are located in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Annual Report on Form 10-K for the year ended December 31, 2023,2024, as filed with the SEC on MarchFebruary 8,27, 2024.2025.
We are an innovative clinical-stage biopharmaceutical company developing tumor-activateda broad pipeline of novel immunotherapies forby cancer.applying Ourour proprietary technologytechnologies hasto enabled the development of two distinct bispecific platforms:our Tumor Activated T Cell EngagersEngager (TRACTr) and, Tumor Activated ImmunomodulatorsImmunomodulator (TRACIr)., and Adaptive Immune Response Modulator (ARM) platforms. The TRACTr platform produces T cell engagers (TCEs) with a tumor antigen-binding domain and a CD3 T cell binding domain, while the TRACIr platform produces bispecifics with a tumor antigen-binding domain and a costimulatory CD28 binding domain. The goal of bothour TRACTr and TRACIr platforms is to provide cancer patients with safe and effective therapeutics that direct and guide their immune system to eradicate tumors while minimizing safety concerns. Our initial focus is on developing a novel class of TRACTr therapeutics designed to target clinically validated TCE drug targets, butwhile overcomeovercoming the liabilities associated with prior generations of TCEs. While TCE therapeutics have displayed potent anti-tumor activity in hematological cancers, developing TCEs to treat solid tumors has faced challenges due to the limitations of prior TCE technologies, namely (i) on-target healthy tissue immune activation that contributes to cytokine release syndrome (CRS) and healthy tissue toxicity and (ii) poor pharmacokinetics (PK) leading to short half-life. Our first clinical candidate, JANX007, is a prostate-specific membrane antigen or(PSMA) PSMA-TRACTr and isTRACTr being investigated in a Phase 1 clinical trial in adult subjects with metastatic castration-resistant prostate cancer (mCRPC). In December 2024 we announced updated interim clinical data for JANX007 which displayed meaningful and prolonged PSA drops, encouraging anti-tumor activity, a favorable safety profile including CRS and treatment-related adverse events (TRAEs) primarily limited to Cycle 1 and lower grades, and PK consistent with the TRACTr mechanism-of-action. Our second clinical candidate, JANX008, is an epidermal growth factor receptor or(EGFR) EGFR-TRACTr and isTRACTr being studiedinvestigated in a Phase 1 clinical trial for the treatment of multiple solid cancerstumors. includingOur colorectalARM carcinoma,platform squamousbuilds upon our expertise to redesign bispecific T cell carcinomaengagers to address the limitations of theconventional headapproaches in autoimmune diseases and neck,oncology. non-smallThe platform is designed to enable controlled T cell lungactivation cancer,and renalexpansion followed by contraction, with the goal of achieving deep and durable target cell carcinoma,depletion smallwhile cellimproving lung cancer, pancreatic ductal adenocarcinomasafety and triple-negativeconvenience. breastWe cancer.have Theinitiated firsta patientPhase 1 clinical study of our CD19-ARM program (JANX011), which is designed to evaluate the safety, tolerability, pharmacokinetics and pharmacodynamics of JANX011 in healthy volunteers. JANX011 is being developed for autoimmune diseases, and the initiation of this trialstudy wasrepresents dosedan important step in Aprilthe 2023advancement andof inour FebruaryARM 2024platform wefrom announcedpreclinical positivedevelopment earlyinto datathe for JANX008 that displayed anti-tumor activity in multiple tumor types with low-grade CRS and predominantly low-grade TRAEs.clinic. We are also generating a number of unnamedadditional TRACTrTRACTr, TRACIr and TRACIrARM programs for potential future development, someincluding a PSMA x CD28 TRACIr designed to enhance T cell activation and durability of whichJANX007in arepatients atwith development candidate stage or later. We are currently assessing priorities in our preclinical pipeline.mCRPC.
We were incorporated in June 2017. To date, we have devoted substantially all of our resources to organizing and staffing our company, business planning, business development, raising capital, developing and optimizing our technology platform, identifying potential product candidates, undertaking research and development for our lead programs, establishing and enhancing our intellectual property portfolio and providing general and administrative support for these operations. All of our product candidates and research programs other than JANX007 and JANX008 are in preclinical development, and none have been approved for commercial sale. We have never generated any revenue from product sales and have incurred net losses each year since we commenced operations. We have funded our operations primarily with the net proceeds from the issuance of convertible promissory notes, the issuance of convertible preferred stock, the exercise of common stock options, proceeds from our initial public offering (IPO), the issuance of common stock and pre-funded common stock warrants in public and/or underwritten offerings and amounts received under a collaboration agreement with Merck Sharp & Dohme Corp. (Merck).Merck.
Global economic and business activities continue to face widespread geopolitical and macroeconomic uncertainties, including those associated with public health crises, bank failures, inflation and monetary supply shifts, recent and changing tariff policy announcements, tariffs, trade tensions and retaliatory measures by other countries, supply chain disruptions, recession risks and potential disruptions from the Russia-Ukraine conflict, the war in the Middle East and related sanctions. For example, in 2023, the Federal Deposit Insurance Corporation took control and was appointed receiver of certain financial institutions. If other banks and financial institutions enter receivership or become insolvent in the future in response to financial conditions affecting the banking system and financial markets, our ability to access our existing cash, cash equivalents and investments may be threatened and could have a material adverse effect on our business and financial condition. Inflation generally affects us by increasing our salaries and fees paid to third-party contract service providers. We have considered potential impacts arising from the risks and uncertainties as described above and have not experienced any material disruption to our operations to date.
Support Services Agreement with Avalon BioVentures, Inc. (formerly COI Pharmaceuticals, Inc.)
In January 2021, we entered into a Support Services Agreement (the 2021 Support Services Agreement) with Avalon BioVentures, Inc. (Avalon) that outlines the terms of services provided by Avalon to us, as well as the fees charged for such services. Avalon is a shared service company that provides certain back-office and administrative and research and development support services, including facilities support, to the portfolio companies of Avalon Ventures, an entity that beneficially owned greater than 5% of our outstanding capital stock until November 2024. The amounts paid to Avalon include support service fees or mark-ups of up to 5%. The 2021 Support Services Agreement terminated on December 31, 2024.
To date, our research and development expenses have related primarily to direct and indirect expenses in connection with the development of our TRACTrTRACTr, TRACIr and TRACIrARM platforms, discovery efforts and preclinical and clinical development of our product candidates. Research and development expenses are recognized as incurred and payments made prior to the receipt of goods or services to be used in research and development are capitalized until the goods or services are received.
We anticipate that our research and development expenses will substantially increase for the foreseeable future as we continue the development of our TRACTrTRACTr, TRACIr and TRACIrARM platforms and the discovery and development of product candidates under our TRACTrTRACTr, TRACIr and TRACIrARM platforms.
Collaboration revenues were $10.6$10.0 million and $8.1$10.6 million for the years ended December 31, 20242025 and 2023,2024, respectively. The increasedecrease of $2.5$0.6 million was primarily due to an increase in milestone revenue under the achievementMerck Agreement, offset by the completion of aour developmentalresearch milestone related to the First Collaboration Targetactivities under the Merck Agreement in JuneAugust 2024 offset by a decrease in full-time equivalent hours incurred in the performance of research services required under the Merck Agreement.2024.
IND applications for JANX007 and JANX008 were cleared by the U.S. Food and Drug Administration (FDA) in May 2022 and January 2023, respectively. As a result, we have separated direct costs for the development of JANX007 and JANX008 from preclinical stage programs and other direct unallocated costs for the years ended December 31, 2024 and 2023. We will further separate direct costs related to our other programs as future IND applications are cleared by the FDA.
Research and development expenses were $68.4$125.9 million and $54.9$68.4 million for the years ended December 31, 20242025 and 2023,2024, respectively. The increase of $13.5$57.5 million was primarily due to increases in preclinical stage programs and other direct unallocated costs of $31.0 million, indirect costs as a result of increased compensation costs of $16.2 million, direct costs related to the development of JANX007 of $7.8$9.2 million,million and direct costs related to the development of JANX008 of $1.1 million and indirect costs of $5.3 million, offset by decreases in preclinical stage programs and other direct unallocated costs of $0.7 million.
General and administrative expenses were $41.0$41.8 million and $26.1$41.0 million for the years ended December 31, 20242025 and 2023,2024, respectively. The increase of $14.9$0.8 million was primarily due to increases in stock-basedcompensation compensationcosts of $11.2 million, consulting and professional fees of $2.2$1.6 million and other general and administrative expensescosts of $1.5$1.7 million. This was offset by a decrease in stock-based compensation of $2.5 million as a result of incremental stock-based compensation expense taken in 2024 due to the modification of a former director and executive officer’s equity awards.
We have incurred net losses and negative cash flows from operations since our inception and anticipate we will continue to incur net losses and negative cash flows for the foreseeable future. As of December 31, 2024,2025, we had cash, cash equivalents, restricted cash and short-term investments of $1.0$967.4 billion.million. Inclusive in this amount is $0.8 million of restricted cash that is not available for current use.
In July 2023, we closed an underwritten offering of 4,153,717 shares of our common stock and pre-funded warrants to purchase 583,483 shares of common stock at an exercise price of $0.001 per share. The shares of common stock were sold at a price of $12.46 per share and the pre-funded common stock warrants were sold at a price of $12.459 per pre-funded common stock warrant, resulting in gross proceeds of $59.0 million. Fees related to the offering included underwriting discounts, commissions, and offering expenses in the aggregate amount of $2.5 million, resulting in net proceeds of $56.5 million.
Net cash used in operating activities of $82.2 million for the year ended December 31, 2025 was primarily due to our net loss of $113.6 million and a change in operating assets and liabilities and other non-cash charges of $8.8 million, offset by $40.2 million of stock-based compensation expense. Net cash used in operating activities of $43.8 million for the year ended December 31, 2024 was primarily due to our net loss of $69.0 million and a change in operating assets and liabilities and other non-cash charges of $7.8 million, offset by $33.0 million of stock-based compensation expense.
Net cash used in operating activities of $43.8 million for the year ended December 31, 2024 was primarily due to our net loss of $69.0 million and a change in operating assets and liabilities and other non-cash charges of $7.8 million, adjusted for $33.0 million of stock-based compensation expense. Net cash used in operating activities of $50.6 million for the year ended December 31, 2023 was primarily due to our net loss of $58.3 million and a change in operating assets and liabilities and other non-cash charges of $12.3 million, adjusted for $20.0 million of stock-based compensation expense.
Net cash used in investing activities of $301.0 million for the year ended December 31, 2025 was primarily due to $300.0 million of net purchases of short-term investments and our purchase of property and equipment, primarily consisting of laboratory equipment of $1.0 million. Net cash used in investing activities of $258.0 million for the year ended December 31, 2024 was primarily due to $257.7 million of net purchases of short-term investments and our purchase of property and equipment, primarily consisting of laboratory equipment of $0.3 million.
Net cash used in investing activities of $258.0 million for the year ended December 31, 2024 was primarily due to $257.7 million of net purchases of short-term investments and by our purchase of property and equipment, primarily consisting of laboratory equipment of $0.3 million. Net cash used in investing activities of $41.2 million for the year ended December 31, 2023 was primarily due to $39.3 million of net purchases of short-term investments and by our purchase of property and equipment, primarily consisting of laboratory equipment of $1.9 million.
Net cash provided by financing activities of $4.9 million for the year ended December 31, 2025 was primarily due to exercises of common stock options and from shares issued under our 2021 Employee Stock Purchase Plan (ESPP) of $5.2 million, offset by issuance costs paid in connection with an underwritten offering in December 2024 of $0.3 million. Net cash provided by financing activities of $713.2 million for the year ended December 31, 2024 was primarily due to proceeds from the issuance of common stock and pre-funded common stock warrants, net of issuance costs, of $698.3 million, and exercises of common stock options and from shares issued under our 2021 ESPP of $14.9 million.
Net cash provided by financing activities of $713.2 million for the year ended December 31, 2024 was primarily due to proceeds from the issuance of common stock and pre-funded common stock warrants, net of issuance costs, of $698.3 million, and exercises of common stock options and from shares issued under our 2021 Employee Stock Purchase Plan (ESPP) of $14.9 million. Net cash provided by financing activities of $59.5 million for the year ended December 31, 2023 was primarily due to proceeds from the issuance of common stock and pre-funded common stock warrants, net of issuance costs, of $56.5 million, and exercises of common stock options and from shares issued under our ESPP of $3.0 million.
Based on our current operating plan, we believe that our existing cash, cash equivalents and short-term investments, will be sufficient to meet our anticipated operating expenses and capital expenditure requirements through at least the next 12 months, following the date of this Annual Report. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. We have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we expect. Additionally, the process of testing product candidates in clinical trials is costly, and the timing of progress and expenses in these trials is uncertain.
Additionally, the process of testing product candidates in clinical trials is costly, and the timing of progress and expenses in these trials is uncertain.
the effects of the disruptions to and volatility in the credit and financial markets in the United States and worldwide resulting from geopolitical and macroeconomic conditions, including recent and changing tariff policy announcements, tariffs, trade tensions and retaliatory measures by other countries, supply chain disruptions, recession risks, the military conflict in Ukraine and Russia, the war in the Middle East, epidemics and bank failures; and the costs of operating as a public company.
In October 2021, we entered into a noncancelable agreement to lease office and laboratory space in San Diego, California (Torrey Plaza Lease) with aggregate payments of approximately $38.0 million over the 126-month term of the lease. The Torrey Plaza Lease commenced in July 2022. See Note 3 to our audited financial statements appearing in Part II, Item 8 of this Annual Report on Form 10-K for additional information. In June 2025, we entered into a noncancelable agreement to sublease additional office space in San Diego, California through January 2028.
What changed in the latest 10-Q
Risk Factors
Largest changes
see in full comparisonWe cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad. For example, the regulatory landscape related to clinical trials in the EU has undergone recent changes. The EU Clinical Trials Regulation, or CTR, which was adopted in April 2014 and repeals the EU Clinical Trials Directive, became effective on January 31, 2022. The CTR permits trial sponsors to make a single submission to both the competent authority and an ethics committee in each EU Member State, leading to a single decision for each EU Member State. The assessment procedure for the authorization of clinical trials has been harmonized as well, including a joint assessment of some elements of the application by all EU Member States in which the trial is to be conducted, and a separate assessment by each EU Member State with respect to specific requirements related to its own territory, including ethics rules. Each EU Member State’s decision is communicated to the sponsor through a centralized EU portal, the Clinical Trial Information System, or CTIS. The CTR provides a three-year transition period. The extent to which ongoing clinical trials will be governed by the CTR varies. For clinical trials in relation to which an application for approval was made on the basis of the Clinical Trials Directive before January 31, 2023, the CTD will continue to apply on a transitional basis until January 31, 2025. By that date, all ongoing trials will become subject to the provisions of the CTR. The CTR foresaw a three-year transition period that ended on January 31, 2025. Since this date, all new or ongoing trials are subject to the provisions of the CTR.In the European Union, many EU Member States periodically review their reimbursement procedures for medicinal products, which could have an adverse impact on reimbursement status. Moreover, in order to obtain reimbursement for our products in some European countries, including some EU Member States, we may be required to compile additional data comparing the cost-effectiveness of our products to other available therapies. This HTA of medicinal products is becoming an increasingly common part of the pricing and reimbursement procedures in some EU Member States, including those representing the larger markets. The HTA process is the procedure to assess therapeutic, economic and societal impact of a given medicinal product in the national healthcare systems of the individual country. The outcome of an HTA will often influence the pricing and reimbursement status granted to these medicinal products by the competent authorities of individual EU Member States. The extent to which pricing and reimbursement decisions are influenced by the HTA of the specific medicinal product currently varies between EU Member States. On January 12, 2025, the HTA Regulation entered into application through a phased implementation. The HTA Regulation is intended to boost cooperation among EU Member States in assessing health technologies, including new medicinal products, and establishes the framework for EU level joint clinical assessments, joint scientific consultations and early identification of emerging health technologies. The HTA Regulation permits EU Member States to use common HTA tools, methodologies and procedures across the EU, and requires them to rely on EU level joint clinical assessment reports for the clinical components of their national HTA evaluations. Individual EU Member States continue to be responsible for assessing non-clinical (e.g., economic, social, ethical) aspects of health technologies and making decisions on pricing and reimbursement.
Specifically, there are many companies pursuing a variety of approaches to immuno-oncology and autoimmune disease treatments, including large pharmaceutical and biotechnologysee in full comparisoncompanies,companies such as AbbVie, Amgen, Astellas, AstraZeneca,Biogene,Bayer, BeOne Medicines, Boehringer Ingelheim, Bristol Myers Squibb, Chugai Pharmaceutical, Eli Lilly, Gilead, GlaxoSmithKline, Johnson & Johnson, Merck & Co., Novartis, Pfizer, Regeneron, Roche/Genentech,Sanofi, TakedaSanofi andXencor.Takeda,OtherascompanieswellusingasPSMA-targeting therapeutics for the treatment of cancer include AbbVie, Amgen, AstraZeneca, Bayer, Crescendo Biologics, Eli Lilly, GlaxoSmithKline, Johnsonclinical-stage andJohnson,emergingLantheus,biotechnology companies, including Adagene, Aktis Oncology, Argenx, Cabaletta Bio, Climb Bio, Context Therapeutics, Cullinan Therapeutics, CytomX Therapeutics, Dianthus Therapeutics, Immatics, Immunocore, Kyverna Therapeutics, Lava Therapeutics,Novartis,VirRegeneronBiotechnology, Werewolf Therapeutics, Xencor, Xilio Therapeutics andVirZenasBiotechnology.Bio.WeThesealsocompaniesfacearecompetitiondevelopingfromproductsbiologicthatprodrugmaydeveloperscompetesuchwithasourAdagene,productChugaicandidatesPharmaceuticalacrossCo./RochemultipleHoldingtherapeuticAG,modalities,CytomXmolecularTherapeutics, Merck & Co., Takedatargets andVirtherapeuticBiotechnology.technologies, including T cell engagers, radiopharmaceuticals, antibody-drug conjugates, cell therapies, and masked and conditionally activated biologics.
“We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad. For example, the regulatory landscape related to clinical trials in the EU has undergone recent changes. The EU Clinical Trials Regulation, or CTR, which was adopted in April 2014 and repeals the EU Clinical Trials Directive, became effective on January 31, 2022. …”see in full comparison
In addition, on December 11, 2025, the European Commission, the Parliament and the European Council reached a political agreement on the Pharma Package. The reform has been under negotiation since the European Commission submitted its proposal in April 2023. This package, comprised of a new directive and regulation to replace existing legislation, aims to modernize the EU framework. The political agreement is still subject to formal approval by the European Parliament and Council. If approved in the form proposed, the Pharma Package will, among other changes, reduce the baseline market protection period by one year, with limited opportunities for extensions; reshape the incentives regime for orphan medicinal products; and expand the Bolar exemption, a patent-related regulatory safe harbor, to permit generic and biosimilar manufacturers to conduct preparatory activities for regulatory submissions, including pricing and reimbursement, and participate in procurement tenders while patent protection remains in force. A decrease in market exclusivity opportunities for our product candidates in the EU, combined with the expanded Bolar exemption, could open them to generic or biosimilar competition earlier than under the current regime, potentially impacting reimbursement status and the commercial prospects of our product candidates. The new framework is expected to enter into force in late 2026 and to be subject to transitional arrangements, with full application not anticipated before 2028. Other legislative initiatives in the EU include the proposed SPC Regulation revision, the proposed Critical Medicines Act (for which a provisional political agreement was reached in May 2026), and the proposed Biotech Act.see in full comparison
We are an early-stage biopharmaceutical company with a limited operating history that may make it difficult to evaluate the success of our business to date and to assess our future viability. Our operations to date have been limited to organizing and staffing our company, business planning, business development, raising capital, developing and optimizing our technology platform, identifying potential product candidates, undertaking research and preclinical studies for our lead programs, establishing and enhancing our intellectual property portfolio and providing general and administrative support for these operations. All of our product candidates and research programs other than JANX007, JANX011 and JANX014 are in preclinical development, and none have been approved for commercial sale. We have never generated any revenue from product sales and have incurred net losses each year since we commenced operations. For thesee in full comparisonthreesix months endedMarchJune31,30, 2026 and 2025, our net losses were$24.4$46.3 million and$23.5$57.4 million, respectively. We expect that it will be several years, if ever, before we have a product candidate ready for regulatory approval and commercialization. We expect to incur increasing levels of operating losses over the next several years and for the foreseeable future as we advance our product candidates through clinical development. Our prior losses, combined with expected future losses, have had and will continue to have an adverse effect on our stockholders’ equity and working capital.
Full comparison: every changed paragraph (12)
We are an early-stage biopharmaceutical company with a limited operating history that may make it difficult to evaluate the success of our business to date and to assess our future viability. Our operations to date have been limited to organizing and staffing our company, business planning, business development, raising capital, developing and optimizing our technology platform, identifying potential product candidates, undertaking research and preclinical studies for our lead programs, establishing and enhancing our intellectual property portfolio and providing general and administrative support for these operations. All of our product candidates and research programs other than JANX007, JANX011 and JANX014 are in preclinical development, and none have been approved for commercial sale. We have never generated any revenue from product sales and have incurred net losses each year since we commenced operations. For the threesix months ended MarchJune 31,30, 2026 and 2025, our net losses were $24.4$46.3 million and $23.5$57.4 million, respectively. We expect that it will be several years, if ever, before we have a product candidate ready for regulatory approval and commercialization. We expect to incur increasing levels of operating losses over the next several years and for the foreseeable future as we advance our product candidates through clinical development. Our prior losses, combined with expected future losses, have had and will continue to have an adverse effect on our stockholders’ equity and working capital.
As of MarchJune 31,30, 2026, we had $956.4$970.9 million in cash, cash equivalents and short-term investments. Based upon our current operating plan, we estimate that our existing cash, cash equivalents and short-term investments will be sufficient to fund our operating expenses and capital expenditure requirements for at least the next 12 months following the date of this Quarterly Report. However, we believe that our existing cash, cash equivalents and short-term investments will not be sufficient to fund any of our product candidates through regulatory approval, and we will need to raise substantial additional capital to complete the development and commercialization of our product candidates.
Our product candidates are based on novel technologies, which make it difficult to predict the timing, results and cost of product candidate development and likelihood of obtaining regulatory approval.*
The market opportunity for our product candidates may be relatively small as it will be limited to those patients who are ineligible for or have failed prior treatments and our estimates of the prevalence of our target patient populations may be inaccurate.*
As of MarchJune 31,30, 2026, we had 108113 full-time employees. As we advance our research and development programs, we will be required to further increase the number of our employees and the scope of our operations, particularly in the areas of research and clinical development, medical affairs, general and administrative matters relating to being a public company, regulatory affairs and, if any of our product candidates receives marketing approval, sales, marketing and distribution. To manage any future growth, we must:
We face substantial competition, which may result in others discovering, developing or commercializing products more quickly or marketing them more successfully than us.*
Specifically, there are many companies pursuing a variety of approaches to immuno-oncology and autoimmune disease treatments, including large pharmaceutical and biotechnology companies,companies such as AbbVie, Amgen, Astellas, AstraZeneca, Biogene,Bayer, BeOne Medicines, Boehringer Ingelheim, Bristol Myers Squibb, Chugai Pharmaceutical, Eli Lilly, Gilead, GlaxoSmithKline, Johnson & Johnson, Merck & Co., Novartis, Pfizer, Regeneron, Roche/Genentech, Sanofi, TakedaSanofi and Xencor.Takeda, Otheras companieswell usingas PSMA-targeting therapeutics for the treatment of cancer include AbbVie, Amgen, AstraZeneca, Bayer, Crescendo Biologics, Eli Lilly, GlaxoSmithKline, Johnsonclinical-stage and Johnson,emerging Lantheus,biotechnology companies, including Adagene, Aktis Oncology, Argenx, Cabaletta Bio, Climb Bio, Context Therapeutics, Cullinan Therapeutics, CytomX Therapeutics, Dianthus Therapeutics, Immatics, Immunocore, Kyverna Therapeutics, Lava Therapeutics, Novartis,Vir RegeneronBiotechnology, Werewolf Therapeutics, Xencor, Xilio Therapeutics and VirZenas Biotechnology.Bio. WeThese alsocompanies faceare competitiondeveloping fromproducts biologicthat prodrugmay developerscompete suchwith asour Adagene,product Chugaicandidates Pharmaceuticalacross Co./Rochemultiple Holdingtherapeutic AG,modalities, CytomXmolecular Therapeutics, Merck & Co., Takedatargets and Virtherapeutic Biotechnology.technologies, including T cell engagers, radiopharmaceuticals, antibody-drug conjugates, cell therapies, and masked and conditionally activated biologics.
Enacted and future legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and affect the prices we may charge for such product candidates.*
We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad. For example, the regulatory landscape related to clinical trials in the EU has undergone recent changes. The EU Clinical Trials Regulation, or CTR, which was adopted in April 2014 and repeals the EU Clinical Trials Directive, became effective on January 31, 2022. The CTR introduces, among other changes, a centralized application system, coordinated review procedures, expanded reporting and increased transparency obligations. The CTR foresaw a three-year transition period that ended on January 31, 2025. Since this date, all new or ongoing trials are subject to the provisions of the CTR. Since this date, all new or ongoing trials are subject to the provisions of the CTR.
We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad. For example, the regulatory landscape related to clinical trials in the EU has undergone recent changes. The EU Clinical Trials Regulation, or CTR, which was adopted in April 2014 and repeals the EU Clinical Trials Directive, became effective on January 31, 2022. The CTR permits trial sponsors to make a single submission to both the competent authority and an ethics committee in each EU Member State, leading to a single decision for each EU Member State. The assessment procedure for the authorization of clinical trials has been harmonized as well, including a joint assessment of some elements of the application by all EU Member States in which the trial is to be conducted, and a separate assessment by each EU Member State with respect to specific requirements related to its own territory, including ethics rules. Each EU Member State’s decision is communicated to the sponsor through a centralized EU portal, the Clinical Trial Information System, or CTIS. The CTR provides a three-year transition period. The extent to which ongoing clinical trials will be governed by the CTR varies. For clinical trials in relation to which an application for approval was made on the basis of the Clinical Trials Directive before January 31, 2023, the CTD will continue to apply on a transitional basis until January 31, 2025. By that date, all ongoing trials will become subject to the provisions of the CTR. The CTR foresaw a three-year transition period that ended on January 31, 2025. Since this date, all new or ongoing trials are subject to the provisions of the CTR. In the European Union, many EU Member States periodically review their reimbursement procedures for medicinal products, which could have an adverse impact on reimbursement status. Moreover, in order to obtain reimbursement for our products in some European countries, including some EU Member States, we may be required to compile additional data comparing the cost-effectiveness of our products to other available therapies. This HTA of medicinal products is becoming an increasingly common part of the pricing and reimbursement procedures in some EU Member States, including those representing the larger markets. The HTA process is the procedure to assess therapeutic, economic and societal impact of a given medicinal product in the national healthcare systems of the individual country. The outcome of an HTA will often influence the pricing and reimbursement status granted to these medicinal products by the competent authorities of individual EU Member States. The extent to which pricing and reimbursement decisions are influenced by the HTA of the specific medicinal product currently varies between EU Member States. On January 12, 2025, the HTA Regulation entered into application through a phased implementation. The HTA Regulation is intended to boost cooperation among EU Member States in assessing health technologies, including new medicinal products, and establishes the framework for EU level joint clinical assessments, joint scientific consultations and early identification of emerging health technologies. The HTA Regulation permits EU Member States to use common HTA tools, methodologies and procedures across the EU, and requires them to rely on EU level joint clinical assessment reports for the clinical components of their national HTA evaluations. Individual EU Member States continue to be responsible for assessing non-clinical (e.g., economic, social, ethical) aspects of health technologies and making decisions on pricing and reimbursement.
In addition, on December 11, 2025, the European Commission, the Parliament and the European Council reached a political agreement on the Pharma Package. The reform has been under negotiation since the European Commission submitted its proposal in April 2023. This package, comprised of a new directive and regulation to replace existing legislation, aims to modernize the EU framework. The political agreement is still subject to formal approval by the European Parliament and Council. If approved in the form proposed, the Pharma Package will, among other changes, reduce the baseline market protection period by one year, with limited opportunities for extensions; reshape the incentives regime for orphan medicinal products; and expand the Bolar exemption, a patent-related regulatory safe harbor, to permit generic and biosimilar manufacturers to conduct preparatory activities for regulatory submissions, including pricing and reimbursement, and participate in procurement tenders while patent protection remains in force. A decrease in market exclusivity opportunities for our product candidates in the EU, combined with the expanded Bolar exemption, could open them to generic or biosimilar competition earlier than under the current regime, potentially impacting reimbursement status and the commercial prospects of our product candidates. The new framework is expected to enter into force in late 2026 and to be subject to transitional arrangements, with full application not anticipated before 2028. Other legislative initiatives in the EU include the proposed SPC Regulation revision, the proposed Critical Medicines Act (for which a provisional political agreement was reached in May 2026), and the proposed Biotech Act.
The price of our common stock could decline if there are substantial sales of our common stock, particularly sales by our directors, executive officers and significant stockholders, or if there is a large number of shares of our common stock available for sale and the market perceives that sales will occur. As of MarchJune 31,30, 2026, we had 60,865,45861,077,980 outstanding shares of common stock.
Management's Discussion & Analysis (MD&A)
New heading “Comparison of the Six Months Ended June 30, 2026 and 2025 (in thousands)”
New heading “Collaboration Revenue”
New heading “Research and Development Expense”
New heading “General and Administrative Expense”
Largest changes
“Comparison of the Six Months Ended June 30, 2026 and 2025 (in thousands)”see in full comparison
“Collaboration revenues were $14.0 million and $0 for the six months ended June 30, 2026 and 2025, respectively. The increase of $14.0 million was due to the execution of the BMS Agreement in January 2026 and the related revenue recognized based on the full-time equivalent hours and costs incurred in the performance of research services required under the BMS Agreement.”see in full comparison
“Research and development expenses were $26.8 million and $25.1 million for the three months ended March 31, 2026 and 2025, respectively. The increase of $1.7 million was primarily due to increases in preclinical stage programs and other direct unallocated costs of $1.4 million. Additional increases included indirect costs as a result of increased personnel costs of $0.9 million and direct costs related to the development of JANX007 of $0.9 million. …”see in full comparison
Full comparison: every changed paragraph (27)
We are an innovative clinical-stage biopharmaceutical company developing a broad pipeline of novel immunotherapies by applying our proprietary technologies to our Tumor Activated T Cell Engager (TRACTr), Tumor Activated Immunomodulator (TRACIr), and Adaptive Immune Response Modulator (ARM) platforms. The TRACTr platform produces T cell engagers (TCEs) with a tumor antigen-binding domain and a CD3 T cell binding domain, while the TRACIr platform produces bispecifics with a tumor antigen-binding domain and a costimulatory CD28 binding domain. The goal of our TRACTr and TRACIr platforms is to provide cancer patients with safe and effective therapeutics that direct and guide their immune system to eradicate tumors while minimizing safety concerns. Our initial focus is on developing a novel class of TRACTr therapeutics designed to target clinically validated TCE drug targets while overcoming the liabilities associated with prior generations of TCEs. While TCE therapeutics have demonstrated potent anti-tumor activity in hematological cancers, development in solid tumors has been limited by challenges associated with prior TCE technologies, including (i) on-target healthy tissue immune activation that contributes to cytokine release syndrome (CRS) and healthy tissue toxicity and (ii) poor pharmacokinetics (PK) leading to short half-life. Our lead clinical candidate, JANX007, is a prostate-specific membrane antigen (PSMA)-targeted TRACTr being investigated in a Phase 1 clinical trial in adult subjects with metastatic castration-resistant prostate cancer (mCRPC). We are also advancing JANX014, a double-masked PSMA-targeted TRACTr, which entered clinical evaluation in April 2026. In addition, we are developing JANX013, a PSMA-targeted TRACIr incorporating CD28 costimulation, which is planned to enter clinical development in the second half of 2026. Our ARM platform builds upon our expertise to redesign bispecific T cell engagers to address the limitations of conventional approaches in autoimmune diseases and oncology. The platform is designed to enable controlled T cell activation and expansion followed by contraction, with the goal of achieving deep and durable target cell depletion while improving safety and convenience. In February 2026, we initiated a Phase 1 clinical study of our CD19-ARM program (JANX011), which is designed to evaluate the safety, tolerability, pharmacokinetics and pharmacodynamics of JANX011 in healthy volunteers. JANX011 is being developed for autoimmune diseases, and the initiation of this study represents an important step in the advancement of our ARM platform from preclinical development into the clinic. We are also generating a number of additional TRACTr, TRACIr and ARM programs for potential future development. In April 2026, we announced the decision to voluntarily discontinue further clinical development of JANX008, an epidermal growth factor receptor (EFGR)-targeted TRACTr program, following internal review of the data from the Phase 1a portion of the study because the overall magnitude and consistency of activity were not sufficient to support continued development relative to other pipeline programs and we have determined to prioritize development resources toward other pipeline opportunities.
We have incurred operating losses since our inception and have not yet generated any product revenue. Our net losses were $24.4$46.3 million and $23.5$57.4 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 $375.7$397.7 million.
In January 2026, we entered into an exclusive license and collaboration agreement (the BMS Agreement) with Bristol-Myers Squibb Company (BMS) to develop an undisclosed, novel tumor-activated therapeutic targeting a validated solid tumor antigen expressed across several human cancer types. Under the BMS Agreement, BMS received an exclusive worldwide license, under the relevant patents and know-how owned or in-licensed by us, to develop, manufacture, commercialize and otherwise exploit a tumor-activated therapeutic targeting the collaboration target. In addition, we are responsible for conducting, at our own expense and pursuant to an agreed joint development plan, pre-clinical development until Investigational New Drug application (IND) submission for the collaboration target. In return, we have received an upfront payment of $15.0 million, will receivea $35.0 million payment related to a developmental milestone achieved in March 2026, we are entitled to reimbursement of expenses associated with certain research and development activities we are required to perform under the BMS Agreement and will be eligible to receive $750.0 million in additional payments contingent upon successful completion of certain milestones. We are also entitled to tiered royalties on global product sales, with the applicable royalty rates ranging from high-single digit to low-double digit percentages, subject to certain customary reductions.
To date, we have not generated any revenues from the commercial sale of any products, and we do not expect to generate revenues from the commercial sale of any products for the foreseeable future, if ever. Under the Merck Agreement, we recognized no revenue for each of the threesix months ended MarchJune 31,30, 2026 and 2025, respectively.2025. Under the BMS Agreement, we recognized $3.7$14.0 million for the threesix months ended MarchJune 31,30, 2026.
Comparison of the Three Months Ended MarchJune 31,30, 2026 and 2025 (in thousands)
Collaboration revenues were $3.7$10.3 million and $0 for the three months ended MarchJune 31,30, 2026 and 2025, respectively. The increase of $3.7$10.3 million was due to the execution of the BMS Agreement in January 2026 and the related revenue recognized based on the full-time equivalent hours and costs incurred in the performance of research services required.required under the BMS Agreement.
The following table summarizes our direct and indirect research and development expenses for the three months ended MarchJune 31,30, 2026 and 2025 (in thousands):
Research and development expenses were $31.0 million and $34.7 million for the three months ended June 30, 2026 and 2025, respectively. The decrease of $3.7 million was primarily due to decreases in direct costs related to the development of JANX011 of $4.0 million, direct costs related to the development of JANX014 of $2.2 million, direct costs related to the development of JANX008 of $0.9 million and direct costs related to the development of JANX007 of $0.6 million. This was offset by increases in preclinical stage programs and other direct unallocated costs of $3.7 million and personnel costs of $0.3 million.
Research and development expenses were $26.8 million and $25.1 million for the three months ended March 31, 2026 and 2025, respectively. The increase of $1.7 million was primarily due to increases in preclinical stage programs and other direct unallocated costs of $1.4 million. Additional increases included indirect costs as a result of increased personnel costs of $0.9 million and direct costs related to the development of JANX007 of $0.9 million. This was offset by decreases in direct costs related to the development of JANX011 of $1.3 million and direct costs related to the development of JANX008 of $0.2 million.
General and administrative expenses were $11.1$11.0 million and $9.8$10.5 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively. The increase of $1.3$0.5 million was primarily due to increases in consulting and professional fees of $0.9$0.5 million,million and personnel costs of $0.9 million and other general and administrative costs of $0.3$0.2 million, offset by a decrease in stock-based compensation expense of $0.8$0.2 million.
Other income was $9.9$9.7 million and $11.4$11.3 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively. The decrease of $1.5$1.6 million was due to a decrease in cash and cash equivalents and short-term investments resulting in decreased interest income.
Comparison of the Six Months Ended June 30, 2026 and 2025 (in thousands)
Collaboration Revenue
Collaboration revenues were $14.0 million and $0 for the six months ended June 30, 2026 and 2025, respectively. The increase of $14.0 million was due to the execution of the BMS Agreement in January 2026 and the related revenue recognized based on the full-time equivalent hours and costs incurred in the performance of research services required under the BMS Agreement.
Research and Development Expense
The following table summarizes our direct and indirect research and development expenses for the six months ended June 30, 2026 and 2025 (in thousands):
Research and development expenses were $57.8 million and $59.7 million for the six months ended June 30, 2026 and 2025, respectively. The decrease of $1.9 million was primarily due to decreases in direct costs related to the development of JANX011 of $5.3 million, direct costs related to the development of JANX014 of $2.7 million and direct costs related to the development of JANX008 of $1.1 million. This was offset by increases in preclinical stage programs and other direct unallocated costs of $5.6 million, personnel costs of $1.2 million and direct costs related to the development of JANX007 of $0.4 million.
General and Administrative Expense
General and administrative expenses were $22.1 million and $20.3 million for the six months ended June 30, 2026 and 2025, respectively. The increase of $1.8 million was primarily due to increases in consulting and professional fees of $1.4 million, personnel costs of $1.1 million and other general and administrative costs of $0.3 million, offset by a decrease in stock-based compensation expense of $1.0 million.
Other Income
Other income was $19.6 million and $22.6 million for the six months ended June 30, 2026 and 2025, respectively. The decrease of $3.0 million was due to a decrease in cash and cash equivalents and short-term investments resulting in decreased interest income.
We have incurred net losses and negative cash flows from operations since our inception and anticipate we will continue to incur net losses and negative cash flows for the foreseeable future. As of MarchJune 31,30, 2026, we had cash, cash equivalents, restricted cash and short-term investments of $957.2$971.7 million. Inclusive in this amount is $0.8 million of restricted cash that is not available for current use.
In May 2023, we entered into an ATM Equity OfferingSM Sales Agreement (Sale Agreement) with BofA Securities, Inc. (BofA) to sell shares of our common stock, from time to time, through an “at the market offering” program having an aggregate offering price of up to $150.0 million through which BofA would act as sales agent. In February 2024, we delivered written notice to BofA that we were suspending and terminating the prospectus related to the shares of our common stock issuable pursuant to the terms of the Sale Agreement. In May 2024, we filed a shelf registration statement on Form S-3ASR which included a new prospectus which covers the offering, issuance and sale of up to a maximum aggregate offering price of $150.0 million of our common stock under the Sale Agreement. As of MarchJune 31,30, 2026, $150.0 million of common stock remained available for sale under the Sale Agreement.
Net cash usedprovided inby operating activities of $12.3$0.1 million for the threesix months ended MarchJune 31,30, 2026 was primarily due to our net loss of $24.4 million, an increase of $35.0$46.3 million of accounts receivable and a change in remaining operating assets and liabilities and other non-cash charges of $8.5$8.0 million, offset by $46.3$36.1 million of deferred revenue and $9.3$18.3 million of stock-based compensation expense. Net cash used in operating activities of $17.0$40.8 million for the threesix months ended MarchJune 31,30, 2025 was primarily due to our net loss of $23.5$57.4 million and a change in operating assets and liabilities and other non-cash charges of $4.2$5.1 million, offset by $10.7$21.7 million of stock-based compensation expense.
Net cash providedused byin investing activities of $8.3$30.5 million for the threesix months ended MarchJune 31,30, 2026 was primarily due to $8.6$30.0 million of net maturitiespurchases of short-term investments, offset by our purchase of property and equipment of $0.3$0.5 million. Net cash used in investing activities of $340.4$338.8 million for the threesix months ended MarchJune 31,30, 2025 was primarily due to $340.0$338.0 million of net purchases of short-term investments and by our purchase of property and equipment of $0.4$0.8 million.
Net cash provided by financing activities of $3.5$5.8 million for the threesix months ended MarchJune 31,30, 2026 was due to proceeds from stock option exercises.exercises and shares issued under our employee stock purchase plan. Net cash provided by financing activities of $0.6$1.5 million for the threesix months ended MarchJune 31,30, 2025 was primarily due to proceeds from stock option exercises and shares issued under our employee stock purchase plan of $0.9$1.8 million, adjustedoffset forby issuance costs paid in connection with an underwritten offering in December 2024 of $0.3 million.
Our critical accounting policies are those accounting principles generally accepted in the United States 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. For a description of our critical accounting policies, see Item 1 of Part I, “Notes to Unaudited Condensed Financial Statements — Note 1 — Organization and Summary of Significant Accounting Policies” of this Quarterly Report and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies and Estimates” contained in our Annual Report on Form 10-K, filed with the SEC on February 26, 2026. There have not been any material changes to the critical accounting policies discussed therein during the threesix months ended MarchJune 31,30, 2026.
JANX insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 2 filings (2 insiders, 2 trade dates, 6,097 shares, about $85.8K). Net open-market shares: -6,097 (purchases minus sales); net value about -$85.8K.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 |
|---|---|---|---|---|---|
| 2026-07-31 | Campbell David Alan |
Gift | 123,840 | — | — |
| 2026-07-08 | Campbell David Alan |
Option exercise | 7,000 | $4.21 | $29.5K |
| 2026-06-11 | Ra Capital Nexus Fund Ii, L.p. |
Grant/award | 5,500 | — | — |
| 2026-06-11 | Simson Jake |
Grant/award | 5,500 | — | — |
| 2026-06-11 | Kung Winston |
Grant/award | 5,500 | — | — |
| 2026-06-11 | Hernday Natasha |
Grant/award | 5,500 | — | — |
| 2026-06-11 | Dobmeier Eric |
Grant/award | 5,500 | — | — |
| 2026-06-11 | Capps Vickie L |
Grant/award | 5,500 | — | — |
| 2026-06-11 | Barrett Ronald W |
Grant/award | 5,500 | — | — |
| 2026-06-02 | Doyle Janeen Noel |
Open-market sale | 4,059 | $14.03 | $56.9K |
| 2026-05-11 | Dobek Maria |
Open-market sale | 2,038 | $14.17 | $28.9K |
Well-known investors holding JANX (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Point72 Asset Management (Steve Cohen) | 2026-06-30 | 1,993,837 | $30.6M | 0.05% | Added 72% |
| Two Sigma Investments | 2026-06-30 | 1,207,250 | $18.5M | 0.01% | Added 940% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 1,200,737 | $18.4M | 0.01% | Added 241% |
| D. E. Shaw & Co. | 2026-06-30 | 1,096,509 | $16.8M | 0.01% | Added 1014% |
| Millennium Management (Israel Englander) | 2026-06-30 | 504,544 | $7.7M | 0.01% | Added 30% |
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 108,077 | $1.7M | 0.0% | New position |