LYEL 10-K & 10-Q changes, risk factors and insider trading

We are a clinical-stagelate-stage biopharmaceuticalclinical cell therapy company that has incurred substantial losses since our inception and anticipate that we will continue to incur substantial and increasing net losses for the foreseeable future.

Investment in biopharmaceutical product development is highly speculative because it entails substantial upfront capital expenditures and significant risk that a product candidate will fail to prove safe and effective, gain regulatory approval or become commercially viable. We are a late-stage clinical‑stage biopharmaceuticalcell therapy company that does not yet have any products approved by regulatory authorities for sale, and we have incurred significant research, development and other expenses related to our ongoing operations and expect to continue to incur such expenses. Since our inception, we have not generated any revenue from product sales and have incurred significant net losses. Substantially all of our net losses since inception have resulted from our research and development programs and general and administrative costs associated with our operations.

We do not expect to generate revenue from product sales for the foreseeable future, if at all. We also expect to continue to incur significant expenses and operating losses for the foreseeable future. We anticipate these losses to increase as we continue to research, develop and seek regulatory approvals for our product candidates, expand our manufacturing capabilities, in-license or acquire additional technologies and potentially begin to commercialize product candidates that may achieve regulatory approval. We may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business. The size of our future net losses will depend, in part, on the rate of future growth of our expenses and our ability to generate revenues. Moreover, our net losses may fluctuate significantly from quarter to quarter and year to year, such that a period-to-periodperiod‑to‑period comparison of our results of operations may not be a good indication of our future performance. If any of our product candidates fails in research and development or clinical trials or does not gain regulatory approval, or, if approved, fails to achieve market acceptance, we may never become profitable. Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods.

•advance our genetic and epigenetic reprogramming technologies as well as other research and development efforts;

•incur additional legal, accounting or other expenses in operating our business, including the additional costs associated with operating as a public company and maintaining or regaining compliance with the applicable continued listing requirements of The Nasdaq Global Select Market.

In connection with the Agreement and Plan of Merger, dated as of October 24, 2024, by and among Lyell, ImmPACT, Inspire Merger Sub Inc. and WT Representative LLC, solely in its capacity as the Representative (the Merger Agreement), we agreed to issue additional shares of our common stock upon the achievement of certain IMPT-314 clinical or regulatory milestones and to make certain cash royalty payments to the pre-closing stockholders of ImmPACT based on future annual net sales of IMPT-314 in the United States. In addition, as a result of the acquisition of ImmPACT, we have assumed ImmPACT’s rights and obligations under the UCLA License Agreement, pursuant to which we are obligated to pay a nominal, tiered annual license maintenance fee, one-time milestone payments for each commercialized licensed product and a tiered royalty on worldwide annual net sales of commercialized licensed products. For information related to our milestone and royalty obligations, see Note 3, Acquisition,Acquisitions, in the accompanying notes to our audited consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10‑K.

Additionally,We wealso agreed to make success payments payable in cash or publicly-tradeable shares of our common stock at our discretion pursuant to our success payment agreements with Fred Hutch and Stanford, pursuant to which we may be required to make success payments based on increases in the per share fair value of our common stock on each contractually prescribed measurement date. Our success payment obligations are recorded as liabilities on our audited consolidated balance sheets. Under U.S. generally accepted accounting principles (GAAP), we are required to estimate the fair value of these liabilities as of each quarter end and changes in the estimated fair value are accreted to research and development expense over the service period of the collaboration agreement. Once the requisite service obligation to earn the potential success payment consideration is met under our continued collaboration agreements, the change in the success payment liabilities fair value is recognized in other income or expense, net. For example, in DecemberSeptember 2022,2024, Fred HutchStanford had provided the requisite service obligation to earn the potential success payment consideration under the continued collaboration; accordingly in 2023 and future periods, the change in the success payments liability fair value is recognized in other income or expense, net. We may have additional obligations owed to third parties in the form of cash or equity. Factors that may lead to increases or decreases in the estimated fair value of our success payment liabilities include, among others, changes in the value of the common stock, changes in volatility and changes in the risk-free rate. For information related to our success payment obligations, see Note 4, License, Collaboration and Success Payment Agreements, in the accompanying notes to our audited consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10‑K.

We currently have onlytwo oneproduct candidates in clinical development. Our lead product candidate, IMPT-314,ronde-cel, is under evaluation in the pivotal PiNACLE trial in the 3L+ setting and in a Phase 1/2 clinical development.trial in the 2L setting. A second pivotal trial, PiNACLE-H2H, which is a Phase 3 head-to-head CAR T‑cell therapy randomized controlled trial of ronde-cel for LBCL in the 2L setting, had its first patient dosed in February 2026. LYL273, a novel GCC-targeted CAR T-cell product candidate, is under evaluation in a U.S. Phase 1 dose-escalation, dose-expansion clinical trial in patients with refractory mCRC. We have not yet demonstrated our ability to successfully complete any clinical trials (including any pivotal clinical trials), obtain regulatory approvals, manufacture a commercial‑scale product or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful product commercialization.commercialization, Forand example,we beforehave prioritizingpreviously discontinued clinical development offor ourother IMPT‑314 product candidate, our strategy focused on the development of our LYL797, LYL845 and LYL119 clinical programs, which we discontinued following the acquisition of IMPT-314.programs. We have invested substantial resources in developing our technology platformstechnologies and our product candidates, conducting nonclinical studies, commencing and conducting clinical trials and building our manufacturing facilities and capabilities, each of which will be required prior to any regulatory approval and commercialization. Our ability to generate revenue from product sales, which we do not expect will occur for severala few years, if ever, will depend heavily on the successful research and development and eventual commercialization of one or more product candidates in profitable indications and markets. The success of our efforts to identify, develop, manufacture and commercialize product candidates will depend on many factors, including the following:

•the prevalence and severity of adverse events experienced with any of our product candidates;

•maintaining compliance with regulatory requirements, including the U.S and EU cGMP requirements;

•maintaining a continued acceptable benefit/risk profile of theour products following approvalapproval, if approved by applicable regulatory authorities; and

Our product candidates and technology platformstechnologies are based on novel technologies that are unproven and may not result in approvable or marketable products, which expose us to unforeseen risks and make it difficult for us to predict the time and cost of product development and potential for regulatory approval, and we may not be successful in our efforts to use and expand our technology platformstechnologies to develop any product candidate.

We are seeking to identify and develop a pipeline of product candidates using our proprietary technology platforms.technologies. The scientific research that forms the basis of our efforts to develop product candidates with our technology platformstechnologies is still ongoing. Further, the scientific evidence to support the feasibility of developing therapeutic treatments based on our technology platformstechnologies is both preliminary and limited. Additionally, although IMPT-314ronde‑cel is in the pivotal PiNACLE trial in the 3L+ setting, the PiNACLE-H2H trial in the 2L setting and LYL273 is in Phase 1/2 clinical development, our current clinical data are limited, and nonclinical data from murine tumor models and in vitro experiments with tumor cell lines may not translate into humans or may not accurately predict the safety and efficacy of our product candidates in humans. As a result, we are exposed to a number of unforeseen risks, and it is difficult to predict the types of challenges and risks that we may encounter during development of our product candidates. Although ImmPACTwe hadhave licensedpresented clinical data from the dual‑targetingPiNACLE CD19/CD20trial CARin T‑cellthe product3L+ candidatesetting (IMPT‑314)and from UCLA, which had presented at a conference interimthe Phase 1/2 trial of ronde‑cel, including data in 13from patients with relapsed and/or refractory aggressiveLBCL, NHLand treatedfrom in its clinical trial, our IMPT‑314the Phase 1/2 trial of LYL273 in patients with refractory mCRC, our clinical trials may not generate similar results or otherwise provide adequate data to demonstrate the efficacy and safety of our product candidate.candidates.

Given the novelty of our technology platforms,technologies, we intend to work closely with the FDA and comparable foreign regulatory authorities to perform the requisite scientific analyses and evaluation of our methods to obtain regulatory approval for our product candidates; however, the regulatory pathway with the FDA and comparable foreign regulatory authorities may be more complex and time-consuming relative to other more well-known therapeutics. Even if we obtain human data to support our product candidates, the FDA or comparable foreign regulatory authorities may lack sufficient experience in evaluating the safety and efficacy of our product candidates developed using our technology platforms,technologies, which could result in a longer than expected regulatory review process, increase our expected development costs and delay or prevent commercialization of our product candidates. The validation process takes time and resources, may require independent third-party analyses and may not be accepted or approved by the FDA and comparable foreign regulatory authorities. There can be no assurance as to the length of clinical development, the number of patients that the FDA or comparable foreign regulatory authorities may require to be enrolled in clinical trials to establish the safety, purity and potency of our product candidates or the acceptability to the FDA or comparable foreign regulatory authorities of data generated in these clinical trials to support marketing approvals. We cannot be certain that our approach will lead to the development of approvable or marketable products, alone or in combination with other therapies.

Our ability to compete in the highly competitive biotechnologybiopharmaceutical and pharmaceutical industriesindustry depends upon our ability to attract and retain highly qualified managerial, scientific and medical personnel. We are highly dependent on our management, manufacturing, scientific and medical personnel. The loss of the services of any of our executive officers, other key employees, including our highly skilled and trained personnel at our manufacturing facilities, and other scientific and medical advisors and our inability to find suitable replacements could result in delays in product development and harm our business. We conduct substantially all of our operations at our facilities in the San Francisco, Seattle, BothellSeattle and Los AngelesBothell metropolitan areas. These regions are headquarters to many other biopharmaceutical companies and many academic and research institutions. Competition for skilled personnel in these markets is intense and may limit our ability to hire and retain highly qualified personnel on acceptable terms or at all.

To induce valuable employees to remain at our company, in addition to salary and cash incentives, we have provided equity awards that vest over time and, for certain key employees, equity awards that vest subject to certain performance conditions. The value to employees of equity incentives may be significantly affected by factors beyond our control, including market conditions and volatility, and may at any time be insufficient to counteract more lucrative offers from other companies. Because the trading price of our common stock was significantly below the exercise price for many of the options we had granted to our employees, which made the value of our equity as a retention tool decrease substantially, our Board of Directors authorized a repricing of the exercise price of such options for certain employees in November 2023.2023 and additional equity awards for certain employees in October 2025.

Despite our efforts to retain valuable employees, we may nevertheless experience attrition from members of our management, scientific and development teams. For example, there have been departures of executive officers in the past. Although we have employment agreements with our key employees, these employment agreements provide for at-will employment, which means that any of our employees could leave our employment at any time, with or without notice. We do not maintain “key man” insurance policies on the lives of these individuals or the lives of any of our other employees. Our success also depends on our ability to continue to attract, retain and motivate highly skilled junior, mid-level and senior managers as well as junior, mid-level and senior scientific and medical personnel.

Additionally, we implemented reductions in workforce in the fourth quarters of 2023 and 2024 and the first quarter of 2025,2025. respectively.If Thesewe implement additional reductions in workforceforce in the future, these reductions may yield unintended consequences and costs, such as difficulty retaining and motivating remaining employees, increased difficulty in our day-to-day operations and loss of institutional knowledge and expertise and difficulty in attracting and hiring qualified employees in the future. We may also be subject to reputational risks and litigation risks and expenses and may not realize the savings or operational efficiencies anticipated, which could result in total costs and expenses that are greater than expected.

We are a clinical-stagelate-stage clinical cell therapy company expecting to enter pivotal trials in 2025 and advancing a pipeline of proprietary next-generation autologous CAR T-cell product candidates for patients with cancer. Our goal is to fully realize the curative potential of cell therapy for patients with hematologic malignancies and solid tumors. WeTo achieve this, we are pioneering novel approaches designed to generate T‑cell cellstherapies that drive long-lasting clinical responses. TheOur investigational CAR T-cell therapies start with the identification of promising cancer targets. We then engineer the patient’s own living immune cells are the starting point for our investigational CAR T-cell therapies, and we enhancearm them with our innovative enhancements, including CAR constructs, technologytechnologies andor manufacturing protocols.protocols that are designed to endow T-cells with more potent cancer cell killing capabilities.

In hematologic malignancies, we are focused on advancingdelivering to pivotalpatients trials a product candidate designed to delivermeaningfully improved outcomes over currently approved, first-generation CD19 CAR T-cellT therapiescell for patients with aggressive large B-cell lymphoma.products. Our lead program,product IMPT-314,candidate ronde-cel, also known as LYL314, is a dual-targeting CD19/CD20 CAR T-cell product candidate designed to increase complete response rates and prolong the duration of response as compared to the approved CD19‑targeted CAR T-cell therapies. IMPT-314Ronde-cel is designed with a true ‘OR’ logic gate to target B cells that express either CD19 or CD20 with full potency and is manufactured with a process that enriches for CD62L+‑positive cells to generate cell products with more naïve and central memory CAR T cells with enhanced stemlike features and antitumor activity.

We are advancing a pipeline of next-generation CAR T-cell product candidates. Our leadnonclinical program,programs IMPT-314, is in Phase 1/2 clinicalunder development fortarget relapsedantigens or refractory aggressive large B-cell lymphoma and our preclinical programs targetin solid tumor indications. Each of our programs target cancers with large unmet need with substantial patient populations (see Table 1).populations.

IMPT-314Ronde-cel: A next-generation dual-targeting CD19/CD20 CAR T-cell product candidate designed to increase complete response rates and prolong the duration of response as compared to the approved CD19‑targeted CAR T-cell therapies for the treatment of large B-cell lymphoma.

•We expect to initiate aThe pivotal PiNACLE single-arm trial in mid-2025 in patients with relapsedR/refractoryR large B-cell lymphomaLBCL in the 3rd line3L+ setting who have not yet received CAR T-cell therapy.therapy is ongoing following an End-of-Phase 1 meeting. Updated data from the PiNACLE trial were presented at ASH 2025.

PreclinicalNonclinical Pipeline, TechnologiesPipeline and Manufacturing ProtocolsTechnologies

•The first IND for a fully-armed CAR T-cell product candidate with an undisclosed target for solid tumors is expected in 2026. Lyell is advancing next-generation fully-armed CAR T-cell product candidates, meaning they are armedcandidates with multiple technologies,enhancements, each designed to address different barriers to effective cell therapies, including T-cell exhaustion, lack of durable stemness,stemness as well asand immune suppression within the hostile tumor microenvironment.

Our business and operations may be affected by worldwide economic conditions, which may continue to be impacted by global macroeconomic challenges such as the effects of the ongoing geopolitical conflicts in Ukraine, armed conflicts and turmoil in the Middle East, tensions in U.S.-China relations, inflationary pressures, fluctuations in the interest rate environment, disruption between the U.S. and its trading partners due to tariffs or other policies, ongoing geopolitical conflicts and related U.S. involvement, tensions in geopolitical relations, inflationary pressures, fluctuations in the interest rate environment, instability in the banking industry, supply constraints and overall market volatility. Economic uncertainty may persist into the remainder of 2025,2026, and the market dynamics discussed above and similar adverse conditions may negatively impact our business.

For a detailed description of our license and collaboration agreements, see the section titled “Business—License and Collaboration Agreements” in Part I, Item 1 of this Annual Report on Form 10‑K and Notes 22, 3 and 4 to our audited consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.

To date, research and development expenses consist of costs incurred by us for the discovery and development of our technology platforms and product candidates, and include costs incurred in connection with conducting and completing current and planned clinical trials, strategic collaborations, costs to license technology, personnel-related costs, including stock-based compensation expense, facility and technology related costs, research and laboratory expenses, as well as other expenses, which include consulting fees and other costs. Upfront payments and milestones paid to third parties in connection with technology platforms that have not reached technological feasibility and do not have an alternative future use are expensed as incurred. Research and development costs also include expenses related to the November 2023 reduction in workforce, which was substantially completed in 2023.

Research and development expenses also include non-cash expenses related to the change in the estimated fair value of the success payment obligations over their respective requisite service terms granted to Fred Hutchinson Cancer Center (Fred Hutch) and The Board of Trustees of the LelandStanford. Stanford Junior University (Stanford). See the subsection titled “Critical Accounting Policies and Estimates—Success Payments” below. As of December 31, 2022, Fred Hutch hadhas provided the requisite service obligation to earn the potential success payment consideration under thetheir continuedcollaboration collaboration.agreements as of September 30, 2024. For thereporting yearperiods endedbeginning Decemberon 31,October 20231, and future periods,2024, the change in the Fred Hutch success payment liability fair value wasis recognized in other (expense) income, net, as the requisite service obligation had been met. As of September 30, 2024, Stanford had provided the requisite service obligation to earn the potential success payment consideration under the continued collaboration. For the last three months of the year ended December 31, 2024 and future periods, the change in the Stanford success payment liability fair value was recognized in other income, net, as the requisite service obligationobligations had been met. See Note 4, License, Collaboration and Success Payment Agreements, in the accompanying notes to our Consolidatedconsolidated Financialfinancial Statementsstatements included in Part II, Item 8 of this Annual Report on Form 10‑K for additional information. Research and development expenses related to our success payment liabilities are unpredictable and may vary significantly from year‑to‑year due to changes in our assumptions used in the calculation.

We deploy our employee and infrastructure resources across multiple research and development programs for identifying and developing product candidates and establishing manufacturing capabilities. Due to the stage of development and number of ongoing programs and our ability to use resources across several programs, most of our research and development costs are not recorded on a program-specific basis. These include costs for personnel, laboratory and other indirect facility and operating costs.

General and administrative costs include personnel-related expenses, including stock-based compensation expense for personnel in executive, legal, finance and other administrative functions, legal costs, transaction costs related to collaborationlicensing and licensingcollaboration agreements, as well as fees paid for accounting and tax services, consulting fees and facilities costs not otherwise included in research and development expenses. Legal costs include those related to corporate, dispute and patent matters.

We anticipate that our general and administrative expenses will increase over the foreseeable future to support our continued research and development activities, operations generally, future business development opportunities, consulting fees, as well as the costs of operating as a public company such as costs related to accounting, audit, legal, regulatory and tax-related services associated with maintaining compliance with exchange listing and Securities and Exchange Commission (SEC) requirements, director and officer insurance costs and investor and public relations costs.

Acquired in-process research and development (IPR&D) consists primarily of the expenseLYL273 oflicense acquired in November 2025 and the acquired IPR&D assetassets recognized as part of the acquisitionOctober of2024 ImmPACT inacquisition. OctoberThese 2024,assets whichwere wasexpensed upon acquisition as they were determined to have no alternative future use. See Note 3, Acquisition, in the accompanying notes to our audited consolidated financial statements included in Part II, Item 8, of this Annual Report on Form 10-K for additional information.

Impairment of long-lived assets consists primarily of the expense associated with our 2025 impairment of our West Hills, Los Angeles lease right-of-use asset and our 2024 annual impairment assessment,assessment. with theThe impairment losslosses are measured as the amount by which the carrying value of ourthe asset group exceeded its fair value. The impairment loss was allocated on a pro rata basis to our lease right-of-use assets and associated leasehold improvements. See Note 5, Impairment of Long-Lived Assets, in the accompanying notes to our audited consolidated financial statements included in Part II, Item 8, of this Annual Report on Form 10-K for additional information.

Other (Expense) Income, Net

Research and development expenses were $171.6$158.7 million and $182.9$171.6 million for the years ended December 31, 20242025 and 2023,2024, respectively. The decrease of $11.3$12.9 million was primarily due to a decreasereduction of $14.0$12.3 million in personnel‑related expenses andincluding a decrease of $1.1$5.5 million in employee stock compensation expense due to a decline in the value of new awards granted and a $9.2 million reduction in facilities, technology and depreciation expenses mainlydue dueprimarily to thedecreased decreasedepreciation in headcount2025 associatedfollowing withour theprior Company’syear Novemberimpairment 2023of reductionlong-lived assets. The decline in workforceresearch and lowerdevelopment softwareexpenses implementationwas costs. These decreases werepartially offset by ana $8.6 million increase of $3.2 million in research activities, collaborations andcollaborations, outside services and other expenses. This increase was primarily driven by clinical trial activity and a change of $0.6$19.7 million in successstock-based paymentcompensation expense primarilyfor drivenan equity-based ICT milestone deemed probable of achievement as of December 31, 2025, which was partially offset by thedecreased changeresearch inand ourlaboratory stocksupplies price.expense, collaboration agreement expenses and consulting expenses.

General and administrative expenses were $52.0$45.1 million and $67.0$52.0 million for the years ended December 31, 20242025 and 2023,2024, respectively. The decrease of $14.9$6.9 million was primarily due to a $13.0$5.7 million reduction in personnel costs, including a $10.3$5.5 million decrease in stock-based compensation expense, primarily related to significant awards being fully expensed in previous periods and a decrease of $2.7 million in personnel-related expenses mainly due to a decrease in headcount associated with the Company’s November 2023 reduction in workforce.the value of new awards granted, in addition to decreases in outside service expenses.

We do not have any committed external source of funds. Additional funds may not be available when we need them on terms that are acceptable to us, or at all, and our ability to raise additional capital may be adversely impacted by potentially unfavorable global economic conditions or conditions in the biopharmaceutical industry, including disruptions to, or volatility in, the credit and financial markets in the United States and worldwide, actual or perceived changes in interest rates and economic inflation, the current or anticipated impact of geopolitical instability and otherwise. In February 2024, we entered into the Sales Agreement with TD Cowen, acting as our sales agent, pursuant to which we may offer and sell shares of our common stock having an aggregate offering price of up to $150.0 million from time to time in a series of one or more at‑the‑market equity offerings. Neither we nor TD Cowen are obligated to sell any shares. As of MarchJune 31,30, 2026, we have sold 65,092 shares of our common stock under the Sales Agreement. If adequate funds are not available to us on a timely basis, including pursuant to the Sales Agreement, we may be required to delay, limit, reduce or terminate nonclinical studies, clinical trials or other development activities for our product candidates or delay, limit, reduce or terminate our establishment of sales, marketing and distribution capabilities or other activities that may be necessary to commercialize our product candidates.

Our milestone, royalty and success payment obligations may result in dilution to our stockholders or may reduce the availability of our cash resources to satisfy the payment obligations, which could cause our operating results and financial condition to fluctuate significantly from quarter to quarter and year to year and may reduce the usefulness of our GAAP consolidated financial statements.*

In addition, in connection with the ICT License Agreement, ICT is eligible to receive additional cash and equity payments of (i) a potential $30 million clinical milestone payment, up to $115 million upon the achievement of certain late-stage regulatory milestones and up to $675 million in commercial sales milestones; (ii) up to an additional 1.85 million shares of our common stock based on the achievement of certain clinical and regulatory milestonesmilestones, of which we issued 1.1 million shares of our common stock to ICT upon the achievement of a clinical milestone in July 2026; and (iii) tiered royalties ranging from mid-single digits up to 10% on annual net sales in the United States and low to mid-single‑digit royalties on annual net sales in other countries within the licensed territory.

We are seeking to identify and develop a pipeline of product candidates using our proprietary technologies. The scientific research that forms the basis of our efforts to develop product candidates with our technologies is still ongoing. Further, the scientific evidence to support the feasibility of developing therapeutic treatments based on our technologies is both preliminary and limited. Additionally, although ronde‑cel is in the PiNACLE trial in the 3L+ setting and the PiNACLE-H2H trial in the 2L setting and LYL273 is in Phase 1 clinical development, our current clinical data are limited, and nonclinical data may not translate into humans or may not accurately predict the safety and efficacy of our product candidates in humans. As a result, we are exposed to a number of unforeseen risks, and it is difficult to predict the types of challenges and risks that we may encounter during development of our product candidates. Although we have presented clinical data from the PiNACLE trial in the 3L+ setting and the Phase 1/2 trial of ronde‑cel, including data from patients with relapsed and/or refractory LBCL, and from the Phase 1 trial of LYL273 in patients with refractory mCRC, our clinical trials may not generate similar results or otherwise provide adequate data to demonstrate the efficacy and safety of our product candidates.

Clinical development involves a lengthy and expensive process with an uncertain outcome.*

We currently have two product candidates in clinical development. Our lead product candidate, ronde‑cel, is under evaluation in two pivotal trials: PiNACLE, a single-arm clinical trial that is a seamless expansion of the 3L+ cohort in the Phase 1/2 trial, evaluating ronde-cel in patients with R/R LBCL receiving treatment in the 3L+ setting; and PiNACLE-H2H, a Phase 3 head‑to‑head CAR T‑cell therapy randomized controlled trial of ronde‑cel for LBCL in the 2L setting that has commenced dosing. In addition, LYL273, our novel GCC‑targeted CAR T‑cell product candidate for the treatment of mCRC, is currently in Phase 1 clinical development.development, and while we are amending the protocol to enable expansion of this trial into a potentially pivotal Phase 2, this remains subject to receiving FDA guidance. The risk of failure of our product candidates, or any product candidates we acquire, is high. The clinical trials and manufacturing of our product candidates, or any product candidates we acquire, are, and the manufacturing and marketing of such product candidates, if approved, will be, subject to extensive and rigorous review and regulation by numerous government authorities in the United States and in other countries where we intend to test and market our product candidates. Before obtaining regulatory approvals for the commercial sale of any of our product candidates, we must demonstrate through lengthy, complex and expensive nonclinical testing and clinical trials that our product candidates are both safe and effective for use in each target indication. In particular, because our product candidates are subject to regulation as biological products, we will need to demonstrate that they are safe, pure and potent for use in their target indications. Each product candidate must demonstrate an adequate risk versus benefit profile in its intended patient population and for its intended use.

The clinical testing that will be required for any product candidates we choose to advance is expensive and can take many years to complete, and its outcome is inherently uncertain. The FDA may not clear the IND submissions for any planned clinical trials. Even if cleared by the FDA and initiated, we cannot guarantee that any clinical trials will be conducted as planned or completed on schedule, if at all. Failure can occur at any time during the clinical trial process. Even if our current and planned clinical trials are completed as planned, we cannot be certain that their results will support the safety and effectiveness of our product candidates for their targeted indications or support continued clinical development of our product candidates. Product candidates in later stages of clinical trials may fail to show the desired safety and efficacy traits despite having progressed through nonclinical and clinical trials.

Undesirable side effects caused by our product candidates could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay or denial of regulatory approval by the FDA or other comparable foreign regulatory authority. As a result of safety or toxicity issues that we may experience in our clinical trials, we may not continue the development of nor receive approval to market any product candidates, which could prevent us from ever generating product revenues or achieving profitability. Previous clinical trials utilizing CAR T cells to treat hematologic malignancies have shown an increased risk of CRS and ICANS, and approved CAR T-cell therapy products carry a boxed warning concerning the risk of developing secondary T‑cell malignancies. For example, while we observed a manageable safety profile appropriate for potential outpatient administration, initial data from patients with LBCL treated in the 3L+ setting and the 2L setting in our multi-cohort, multi-center Phase 1/2 clinical trial of ronde-cel reported low rates of Grade > 3 ICANS. In addition to CRS and ICANS, diarrhea or colitis have been reported with LYL273. Adverse events may also be associated with the lymphodepletion utilized with cell therapies. If additional adverse events or other side effects are observed in any of our clinical trials that are atypical of, or more severe than, the known side effects of similar cell therapies, we may have difficulty recruiting patients to our clinical trials, patients may drop out of our trials or we may be required to abandon those trials or our development efforts of one or more product candidates altogether. If such effects are more severe, less reversible than we expect or not reversible at all, we may decide or be required to perform additional studies or to halt or delay further clinical development of any of our product candidates, which could result in the delay or denial of regulatory approval by the FDA or other regulatory authorities.

From time to time, we may also disclose preliminary or interim data from our nonclinical studies and from our or related third-party clinical trials. Preliminary or interim data from clinical trials are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available. For example, although we presented clinical data from the PiNACLE trial and the Phase 1/2 trial of ronde‑cel, including data from patients with relapsed and/or refractory LBCL, our ronde‑cel clinical trials, including the PiNACLE trial and the PiNACLE-H2H trial, may not generate similar results or otherwise provide adequate data to demonstrate the efficacy and safety of ronde-cel. In addition, the enrollment of additional patients into the ongoing U.S. Phase 1 clinical trial of LYL273 in patients with refractory mCRC may not generate similar results or otherwise provide adequate data to demonstrate the safety and efficacy of LYL273. Adverse differences between preliminary or interim data and final data could significantly harm our business prospects. Additionally, disclosure of preliminary or interim data by us or by our competitors could result in volatility in the price of our common stock.

We face substantial competition in a rapidly changing industry, which may result in others discovering, developing or commercializing products before or more successfully than we do.*

There are currently a number of companies developing or commercializing autologous and allogeneic CAR T-cell therapies, as well as bi- and tri-specific T-cell engager and other approaches to treat hematologic malignancies and solid tumors. For example, clinical responses in patients with relapsed/refractory multiple myeloma and lymphoma have been reported recently using in vivo CAR T-cell product candidates. Some of the approved or commonly used drugs and therapies for our current or future target diseases, including LBCL and colorectal cancer, are established and are widely accepted by physicians and patients. Insurers and other third–party payors may encourage the use of these products, and some patients may receive commercially available liso‑cel or axi‑cel rather than enrolling into PiNACLE-H2H, our Phase 3 head-to-head CAR T-cell therapy randomized controlled trial in the 2L setting. Physicians, hospitals and third-party payors often are slow to adopt new products, technologies and treatment practices that require additional upfront costs and training. Physicians may not be willing to undergo training to adopt our novel therapy, may decide the therapy is too complex to adopt without appropriate training or not cost-efficient and may choose not to administer the therapy. Based on these and other factors, hospitals and payors may decide that the benefits of this new therapy do not or will not outweigh its costs and choose other drugs or therapies.

The FDA has granted Fast Track and RMAT designations to ronde-cel for the treatment of relapsed and/or refractory aggressive B‑cell lymphoma in the 3L+ settings, RMAT designation to ronde-cel for the treatment of LBCL in the 2L setting and granted Fast Track designation to LYL273 for the treatment of mCRC. We may seek additional designations for our product candidates or for ronde-cel or LYL273 in other indications.

The FDA has broad discretion whether or not to grant such special designations, so even if we believe a particular product candidate is eligible or meets the criteria for a particular special designation, we cannot assure you that the FDA would decide to grant it. Even though we have received Fast Track and RMAT designations to develop ronde-cel for the treatment of relapsed and/or refractory aggressive B‑cell lymphoma in the 3L+ settings, RMAT designation to ronde-cel for the treatment of LBCL in the 2L setting and Fast Track designation to LYL273 for the treatment of mCRC, and even if we receive Fast Track or RMAT designation for other product candidates or indications, we may not experience a faster development process, review or approval compared to conventional FDA procedures, and such designation does not assure ultimate approval by the FDA. In addition, the FDA may withdraw Fast Track and/or RMAT designations if it believes that the designation is no longer supported by data from our clinical development program. Many product candidates that have received special FDA designations have ultimately failed to obtain approval.

Similarly, a significant trend in the healthcare industry is cost containment. Governmental authorities have announced initiatives to control the cost of prescription drugs and third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications. In addition, the Department of Health and Human Services (HHS) has been empowered to negotiate the price of certain single-source biologics that have been on the market for at least 11 years covered under Medicare as part of the Medicare Drug Price Negotiation Program. Each year, up to 20 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. In addition, HHS imposes rebates on many Medicare Part B and Medicare Part D products to penalize price increases that outpace inflation on an annual basis. If coverage and adequate reimbursement are not available, or are available only to limited levels, we may not be able to successfully commercialize our current and any future product candidates that we develop, which could have an adverse effect on our operating results and our overall financial condition. For additional detail on healthcare reform that may affect our cost containment,business, see “Healthcare Reform” in Part I, Item 1 of our 2025 Annual Report. As such, cost containment reform efforts may result in an adverse effect on our operations. Obtaining coverage and adequate reimbursement for our product candidates may be particularly difficult because of the higher prices often associated with drugs administered under the supervision of a physician. Similarly, because our product candidates will be physician-administered, separate reimbursement for the product itself may or may not be available. Instead, the administering physician may or may not be reimbursed for providing the treatment or procedure in which our product is used.

We may be subject to broadly applicable healthcare laws and regulations that may constrain the business or financial arrangements and relationships through which we conduct research, market, sell and distribute any product candidates for which we obtain marketing approval. The healthcare laws that may affect us include: the federal fraud and abuse laws, including the federal anti-kickback, and false claims and civil monetary penalties laws; federal data privacy and security laws, including the Health Insurance Portability and Accountability Act, as amended (HIPAA); and federal transparency laws related to ownership and investment interests and payments and/or other transfers of value made to or held by physicians (including doctors, dentists, optometrists, podiatrists and chiropractors), other healthcare professionals (such as physician assistants and nurse practitioners) and teaching hospitals, as well as information regarding ownership and investment interests held by physicians and their immediate family members. In addition, many states have similar laws and regulations that may differ from each other and federal law in significant ways, thus complicating compliance efforts. Moreover, several states require biopharmaceutical companies to comply with the biopharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government and may require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures. Additionally, some state and local laws require certain regulatory licenses to manufacture or distribute our products in clinical trials or commercially and/or the registration of biopharmaceutical sales representatives in the jurisdiction. Similar requirements are applicable in foreign countries. Outside the United States, interactions between pharmaceutical companies and healthcare professionals are also governed by strict laws, such as national anti-bribery laws of European countries, national sunshine rules, regulations, industry self-regulation codes of conduct and physicians’ codes of professional conduct.

Additional health reform measures may continue and affect our business in unknown ways, particularly given the change in administration. The current administration is pursuing policies to reduce regulations and expenditures across government, including at HHS, the FDA, the Centers for Medicare & Medicaid Services 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 severalcertain 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. These actions and proposals include, for example: (1) reducing agency workforces; (2) directing HHS and other agencies to lower prescription drug costs through a variety of initiatives, including by improving upon the Medicare Drug Price Negotiation Program and establishing Most‑Favored‑Nation pricing for pharmaceutical products; (3) imposing tariffs on certain 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 payment methodologies, among others. As noted above, the Loper decision could result in other legal challenges to current regulations and guidance issued by federal agencies applicable to our operations, including those issued by the FDA. Congress may introduce and ultimately pass health care-related legislation that could impact the drug approval process.

We may seek additional capital through a combination of public and private equity offerings, debt financings, strategic partnerships and alliances and licensing arrangements. We, and indirectly, our stockholders, will bear the cost of issuing and servicing securities issued in any such transactions. Because our decision to issue debt or equity securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of any future offerings. In February 2024, we entered into the Sales Agreement pursuant to which we may offer and sell, from time to time, up to $150.0 million in shares of our common stock. As of MarchJune 31,30, 2026, we have sold 65,092 shares of our common stock under the Sales Agreement. In October 2024, in connection with the acquisition of ImmPACT, we issued 1,875,000 shares of our common stock at closing (shares reflecting the effect of the 1-for-201‑for‑20 reverse stock split we effected in May 2025 (the Reverse Stock Split)), as adjusted for cash payments made in lieu of fractional shares, and, in July 2025, we issued an additional 625,000 shares of our common stock in connection with the achievement of certain clinical milestones, to certain pre‑closing stockholders of ImmPACT. In July 2025, we entered into the SPA, pursuant to which in July 2025, we issued 3,753,752 shares of our common stock in the initial closing and, in March 2026, we issued an additional 1,952,360 shares of our common stock in a subsequent closing. In November 2025 we entered into the exclusive license agreement with ICT pursuant to which we issued 1,900,000 shares of our common stock at closingclosing, 1,100,000 shares of common stock in July 2026 in connection with the achievement of a clinical milestone and may issue up to an additional 1,850,000750,000 shares of our common stock in the future pursuant to the terms specified in the agreement. See Note 9, Stockholders’ Equity, in the accompanying notes to the unaudited condensed consolidated financial statements included in Part I, Item 1, of this Quarterly Report on Form 10‑Q, for additional details regarding the terms under which we may issue additional securities pursuant to the exclusive license agreement with ICT. To the extent that we raise additional capital through the sale of equity or debt securities, including pursuant to the Sales Agreement or exclusive license agreement with ICT, your ownership interest may be diluted, and the terms may include liquidation or other preferences that adversely affect your rights as a stockholder. Any such future issuance of capital stock may result in further dilution of your ownership.

Sales of a substantial number of shares of our common stock by our existing stockholders could cause the price of our common stock to decline.*

Moreover, certain holders of shares of our common stock have rights, subject to conditions, to require us to file or maintain registration statements with the SEC covering their shares or to include their shares in registration statements that we may file for ourselves or other stockholders. For example, in connection with the acquisition of ImmPACT, in October 2024 we issued 1,875,000 shares of our common stock at closing (shares reflecting the effect of the Reverse Stock Split), as adjusted for cash payments made in lieu of fractional shares, and, in July 2025, we issued an additional 625,000 shares of our common stock in connection with the achievement of certain clinical milestones, to certain pre‑closing stockholders of ImmPACT. Additionally, in connection with the ICT License Agreement, we issued to ICT 1,900,000 shares of our common stock to ICT in November 2025.2025 at closing and 1,100,000 shares of our common stock in July 2026 upon the achievement of a clinical milestone. Holders of such shares of our common stock have rights, subject to conditions, to require us to file registration statements covering their shares for public sale within certain timeframes following the closing of the acquisition and the achievement of milestones, as applicable. In addition, the investors under the SPA have rights to require us to file and maintain one or more registration statements covering the shares issued or issuable to them in the private placement for public sale within certain timeframes. If any of these additional shares are sold, or if it is perceived that they will be sold, in the public market, the market price of our common stock could decline.

In hematologic malignancies, we are focused on delivering to patients meaningfully improved outcomes over currently approved, first-generation CD19 CAR T-cell products. Our lead product candidate, rondecabtagene autoleucel, or ronde-cel, is a dual-targeting CD19/CD20 CAR T-cell product candidate designed to increase complete response rates and prolong the duration of response as compared to the approved CD19‑targeted CAR T-cell therapies. Ronde-cel is designed with a true ‘OR’ logic gate to target B cells that express either CD19 or CD20 with full potency at either target and is manufactured with a process that enriches for CD62L‑positive cells to generate more naïve and central memory CAR T cells with enhanced stemlike features and antitumor activity.

We are currently conducting two pivotal trials with ronde-cel. The first, PiNACLE, is a single-arm clinical trial that is a seamless expansion of the third- or later line (3L+) cohort in the Phase 1/2 trial. This trial is expected to report additional data in the second half of 2026 and pivotal data in mid-2027, with submission of a Biologics License Application (BLA) expected to follow in 2027. The PiNACLE trial is evaluating ronde‑cel in patients with relapsed/refractory (R/R) LBCL receiving treatment in the 3L+ setting. We commenced dosing in the first-of-its-kind Phase 3 head-to-head CAR T-cell therapy randomized controlled trial, PiNACLE-H2H, for patients with LBCL receiving treatment in the second-line (2L) setting. Patients are randomized to either ronde-cel or investigator’s choice of axicabtagene ciloleucel (axi-cel) or lisocabtagene maraleucel (liso-cel).

To realize the potential of cell therapy for solid tumors, we acquired an exclusive global license for LYL273 (excluding mainland China, Hong Kong, Macau and Taiwan), a GCC-targetedguanylyl cyclase C (GCC)-targeted CAR T-cell product candidate, from Innovative Cellular Therapeutics Holdings Limited and Innovative Cellular Therapeutics (collectively, ICT) in November 2025. A 67% overall response rate and an 83% disease control rate with a manageable safety profile have been reported at the highest dose level tested in patients with refractory3L+ R/R mCRC in a U.S. Phase 1 clinical trial as of the data cutoff date of October 28, 2025. In June 2026, updated safety data from the ongoing trial were shared. The protocol was recently amended to a Phase 1/2 design to enable seamless expansion into a potential pivotal single-arm Phase 2 trial, pending regulatory alignment, and adds new cohorts, including a 2L cohort and a cohort evaluating a combination strategy with radiotherapy. LYL273 is enhanced with CD19 CAR expression and controlled cytokine release designed to improve CAR T-cell expansion, immune cell infiltration and cancer cell killing in the hostile tumor microenvironment. Clinical proof-of-concept for this program was initially demonstrated in 15 patients with mCRC in an investigator-sponsored clinical trial conducted in China and published in JAMA Oncology (September 2024).

The worldwide sales for currently approved CD19 CAR T-cell products are expected to exceed $5 billion by 2030 (Figure 1). Of the approximately 30,000 patients in the U.S. with LBCL, 40% to 50% are refractory to, or relapse following, first-line treatment and we estimate approximately 12,000 to 15,000 patients in the United States with LBCL progress to 2L treatment. We estimate the 3L+ patient population to be approximately 6,000 to 7,000 patients,patients. includingThis estimate reflects findings from a retrospective analysis presented by investigators from Memorial Sloan Kettering Cancer Center that up to 50% of patients with LBCL who progress on first-line therapy andreceived receivea second regimen of chemotherapy prior to undergoing leukapheresis for CAR T-cell therapy. In a separate Medicare fee-for-service claims analysis, a similar percentage (57%) of patients with LBCL classified as receiving CAR T-cell therapy in the 2L been administered a second chemotherapy regimen prior to CAR while awaiting referral and/or apheresis scheduling, and the worldwide salesscheduling for currently approved CD19 CAR T-cell products are expected to exceed $5 billion by 2030leukapheresis (Figure 12).

While the first generation of CD19 CAR T-cell therapies delivered a major advance in treatment for patients with B-cell lymphoma, there remains a need for therapies that deliver more complete and durable responses. More than 40% of patients with aggressive LBCL treated in the 3L+ setting with a CD19 CAR T-cell therapy are not disease-free after treatment and 30% of patients do not respond at all. Of these patients treated with an approved CD19 CAR T-cell therapy, approximately 50% of patients progress or die within six months, and the overall survival at one year for patients treated with a CD19 CAR T-cell therapy is only 50% to 60%. The median progression-free survival for the approved CD19 CAR T-cell therapies for patients in the 3L+-setting is 6 to 7 months. Importantly, the pivotal trials in the 3L+ setting for axi-cel and liso-cel did not enroll patients over the age of 75, and the axi-cel ZUMA-1 trial did not allow patients to receive bridging therapy between apheresis and CAR T-cell therapy infusion, potentially excluding patients who were progressing too rapidly to wait for CAR T-cell therapy manufacturing.

In the 2L setting, theThe ZUMA-7 randomized controlled trial of axi-cel versus standard of care chemoimmunotherapy did not enroll patients abovein the age2L ofsetting 75demonstrated and the only bridging therapy allowed was steroids. In ZUMA-7, thea complete response rate wasof 65% and thea median progression-free survival in all enrolled patients wasof 14.7 months. For those patients with primary refractory disease, the median progression-free survival was only 7 months.months as reported in an abstract. The complete response rate for patients with primary refractory disease was not reported. The median event-free survival in all patients was 8.3 months. Importantly, this study did not allow patients to receive bridging therapy other than steroids between leukapheresis and CAR T-cell therapy infusion, potentially excluding patients who were progressing too rapidly to wait for CAR T-cell therapy.

Liso-cel was evaluated in two pivotal trials conducted in the 2L setting. The first pivotal trial was a randomized controlled trial of liso-cel versus standard-of-care chemoimmunotherapy (TRANSFORM), which did not enroll patients over the age of 75 but did allow bridging therapy with chemotherapy. The complete response rate was 66% and the median progression-free survival was 14.8 months, and the median event-free survival was 10.1 months in the liso-cel arm. Data for patients with primary refractory disease in the 2L were not reportedpublished from this trial.trial; however, a poster presentation suggested these younger patients (median age of 61 years) with low disease volume (9% of patients with a Sum of Product Diameter > 50 cm2) had similar clinical outcomes between primary refractory and relapsed subgroups. The second pivotal single-arm trial conducted for liso-cel (PILOT), did allow patients over the age of 75 to enroll and included patients ineligible for transplant with primary refractory disease, relapse before 12 months or relapse after 12 months to enroll into the trial.months. The complete response rate in the overall patient population was 54% and was 42% in the primary refractory patient population. The package insert for YESCARTA® lists the rate of Grade 3 or higher cytokine release syndrome (CRS) as 9% and the rate of Grade 3 or higher neurotoxicity as 31%. The package insert for BREYANZI® lists the rate of Grade 3 or higher CRS as 3% and the rate of Grade 3 or higher neurotoxicity as 10%.

A dual-targeting, or bispecific, tandem CAR recognizes two targets with a single construct. Ronde-cel is rationally designed with a true CD19/CD20 “OR” logic-gated CAR targeting either CD19 or CD20 with full potency,potency at either target, and the cell therapy product is enriched for naïve and central memory T cells. Together, this novel construct and the cell enrichment for naïve and central memory T cells are designed to provide multiple clinical benefits over CD19 CAR T-cell therapies, including:

Our ongoing Phase 1/2 trial of ronde-cel is a multi-cohort, multi-center, open-label dose-escalation and dose‑expansion clinical trial designed to evaluate the safety and clinical benefit of ronde-cel (NCT05826535). We presented positive data, detailed below, from the 3L+ and 2L cohorts from the ongoing Phase 1/2 trial during an oral presentation at the American Society of Hematology Annual Meeting and Exhibition in December 2025 (ASH 2025). Based on these data, as well as our recent End-of-Phase 1 meetings with the U.S. Food and Drug Administration (FDA), we announced the initiation of two pivotal trials of ronde-cel: PiNACLE and PiNACLE-H2H.

The PiNACLE trial, which is underway and enrolling patients, is a seamless expansion of the 3L+ cohort of our Phase 1/2 trial. PiNACLE is a single-arm trial evaluating ronde-cel at a dose of 100 x 106 CAR T cells in patients with LBCL treated in the 3L+ setting. The trial is expected to enrolltreat approximately 120100 patients with R/R DLBCL, PMBCL, FL3B or tFL who have received two or more prior lines of therapy and have not received CAR T-cell therapy. Patients may be treated with ronde-cel in the inpatient or outpatient setting, with observation near the site limited to 14 days. There is no upper age limit for eligibility, which broadens the addressable patient population. The primary endpoint of the trial is the best overall response rate, including an evaluation of duration of response. More information about the PiNACLE trial can be found on clinicaltrials.gov (NCT05826535). Additional data from the PiNACLE trial are expected to be reported in the second half of 2026. Pivotal data from the PiNACLE trial are expected in mid-2027, with a Biologics License ApplicationBLA submission expected to follow in the second half of 2027.

Updated safety data from the Phase 1/2 trial were presented at EHA 2026. One hundred and eight patients with R/R LBCL received ronde-cel as of the EHA 2026 data cutoff date of May 5, 2026. In 69108 patients, including all patients from both the 3L+ and the 2L cohorts, a manageable safety profile potentially appropriate for outpatient administration was observed. No Grade 3 or higher CRS was observed. Twenty-fiveSixty-four of the 69108 patients (59%) received protocol-directed dexamethasone prophylaxis (10 mg/day for 3 days). OneNo caseGrade 3 or higher CRS was reported in any patient. Five cases (4%8%) of Grade 3 or higher immune effector cell-associated neurotoxicity syndrome (ICANS) waswere reported in apatients patientreceiving withdexamethasone highprophylaxis. diseaseThe burden;median notime caseto onset of GradeCRS 2was 6 days and of ICANS was reported.7 days in those patients receiving prophylaxis. The median time to resolution of CRS or of ICANS was 3 days. Data are presented in Figure 6.

CRS, cytokine release syndrome; HGBCL, high grade B-cell lymphoma; ICANS, immune effector cell-associated neurotoxicity; IEC-HS, immune effector cell-associated hemophagocytic lymphohistiocytosis-like syndrome; HLH, hemophagocytic lymphohistiocytosis; IV, intravenous; LDH, lactate dehydrogenase; PO, per os (oral).

Ronde-cel demonstrated robust cell expansion with or without dexamethasone prophylaxis (dexamethasone 10 mg by oral or intravenous administration once daily for 3 days) with no significant differences observed in peak CAR T-cell expansion (Cmax) or overall exposure (AUC) between patients who received dexamethasone (N = 25) and those who did not (N = 42).

LYL273: Guanylyl Cyclase C-Targeted CAR T-cell product candidate for the treatment of mCRC and other GCC‑expressing cancers In November 2025, we acquired an exclusive global license, outside of mainland China, Hong Kong, Macau and Taiwan, from ICT for a next-generation GCC-targeted CAR T-cell product candidate (LYL273) with promising dose‑dependent clinical activity in patients with refractoryR/R mCRC in a Phase 1 trial conducted in the U.S. LYL273 is a GCC‑targeted CAR T-cell product candidate enhanced with CD19 CAR expression and controlled cytokine release designed to improve CAR T-cell expansion, immune cell infiltration and cancer cell killing in the hostile solid tumor microenvironment. LYL273 was granted Fast Track designation for the treatment of mCRC by the FDA. Clinical proof-of-concept was initially demonstrated in an investigator-sponsored clinical trial conducted in China prior to the submission to the FDA of an Investigational New Drug Application. Data from this single-center clinical trial in 15 patients with mCRC conducted in China were published in JAMA Oncology (September 2024).

In the ongoing U.S. Phase 1 clinical trial, as of the data cutoff date of October 28, 2025, the overall response rate was 50% (6 of 12 patients) and the disease control rate was 83% across both dose levels. At Dose Level 2, the highest dose tested, the overall response rate was 67%, including one patient with a pathological complete response, one patient with complete reduction in tumor volume of the target lesions (100% partial response) and two additional patients with confirmed partial responses (Figure 67). For patients treated at Dose Level 2, the disease control rate was 83%, and the median progression‑free survival was 7.8 months.

Despite the remaining tremendous unmet medical need for new effective therapies for mCRC, the worldwide net sales for currently approved CRC products are expected to reach $12 billion by 2032 (Figure 78). However, the benefit of approved therapies for mCRC in the 3L+ setting is limited. With the approved products, only six percent6% or less of patients achieve a partial or complete response to their next line of therapy, the median progression-free survival is 6 months or less and the median overall survival is 11 months or less (Figure 78).

Our business and operations may be affected by worldwide economic conditions, which may continue to be impacted by global macroeconomic challenges such as the effects of disruption between the U.S. and its trading partners due to tariffs or other policies, ongoing geopolitical conflicts (including military conflicts, threatened hostilities and conflicts or heightened tension in geopolitical relations) and related U.S. involvement, inflationary pressures, fluctuations in the interest rate environment, instability in the banking industry, supply constraints and overall market volatility. Economic uncertainty may persist throughout the remainder of 2026, and the market dynamics and potential business disruptions discussed above and similar adverse conditions may negatively impact our business.

Other Operating Income,(Income) Loss, Net

Other operating income,(income) loss, net consists primarily of service and occupancy fees received associated with subleases as well as losses on the retirement of property and equipment.

Other income, net consists primarily of the changes in fair value of our SPA put/call (defined below) and success payment liabilities for the three months ended MarchJune 31,30, 2026, and the changes in fair value of our success payment liabilities and SPA put/call (defined below) for the six months ended June 30, 2026. Other income, net consists primarily of the changes in fair value associated with our contingent consideration payable related to the ImmPACT acquisition and success payment liabilities and contingent consideration payable for the three and six months ended MarchJune 31,30, 2025.

The SPA put/call refers to a combined financial instrument arising from the Securities Purchase Agreement (SPA) we entered into in July 2025. It represented (i) our right to require certain investors to purchase additional shares of common stock upon the achievement of specified milestones and (ii) the investors' reciprocal right to purchase additional shares. Because these rights were mutually exclusive, they were accounted for as a single financial instrument (SPA put/call). The SPA put/call was settled in March 2026 upon the Milestone Closing and, accordingly, no changes in its fair value were recognized subsequent to settlement. See Note 7, Fair Value Measurements, in the accompanying notes to our unaudited condensed consolidated financial statements included in Part I, Item 1, of this Form 10-Q for additional information.

Three and Six Months Ended MarchJune 31,30, 2026 and 2025

Research and development expenses were $36.6$39.5 million and $43.4$34.9 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively. The $6.8$4.7 million decreaseincrease was due primarily to a $7.5$8.8 million increase in research activities, collaborations and outside services due to increased clinical trial activity, partially offset by a $1.6 million decrease in personnel‑related expenses and a $2.7$2.6 million reduction in facilities, technology and depreciation expenses primarily due to lower headcount and reduced severance costs associated with the successful technology transfer of ronde-cel to LyFE in 2025 and reduced depreciation expenses, partially offset by a $3.4 million increase in research activities, collaborations and outside services due primarily to increased clinical trials activity.expenses.

General and administrative expenses were $9.6 million and $14.0$9.8 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively. The $4.5$0.2 million decrease was primarily due to a $4.0 million decrease in personnelprofessional costs,and includingoutside aservices $1.5 million decrease in stock-based compensation expense, due to decreased headcount from the successful technology transfer of ronde-cel in 2025.expenses.

Other Operating Income,(Income) Loss, Net

Other operating income,(income) loss, net was $1.9$(1.8) million and $0.1$1.1 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively, and $(3.7) million and $0.9 million for the six months ended June 30, 2026 and 2025, respectively. The increasechanges of $1.8$2.8 million and $4.6 million for the three and six months ended MarchJune 31,30, 20262026, isrespectively, were primarily due primarily to increased sublease income and reduced losses on disposals of property and equipment disposals; we recognized $1.3$2.5 million and $3.8 million of disposalsuch losses infor the priorthree yearand period.six months ended June 30, 2025, respectively, primarily in connection with the closure of the West Hills facility in 2025 following the technology transfer of ronde-cel.

Interest income, net was $2.2 million and $3.9$3.3 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively, and $4.4 million and $7.1 million for the six months ended June 30, 2026 and 2025, respectively. The decrease in interest income, net of $1.7 million for the three and six months ended MarchJune 31,30, 2026 was primarily driven by decreased interest rates in 2026 coupled with lower cash equivalent and marketable securities balances.

Other income, net was $17.9$0.4 million and $1.3$1.2 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively. The increasedecrease of $16.6$0.8 million in other income, net was primarily drivendue byto a gain of $17.6$0.9 million resultinggain recognized in the prior year period from the change in the fair value of our SPAcontingent put/callconsideration asset.payable Thisrelated gain reflectsto the reversalImmPACT ofacquisition thethat $11.4did millionnot liability recorded as of December 31, 2025, as well as a realized gain from issuing shares of our common stock at the SPA put/call exercise price of $25.61, which exceeded the market price at the time of settlement.recur.

Since our inception, we have funded our operations primarily through the sale and issuance of convertible preferred stock, business development activities and the sale of common stock in connection with our IPO, in a private placement financing and pursuant to an at-the-market offering program discussed below. As of MarchJune 31,30, 2026, we had $261.0$228.0 million in cash, cash equivalents and marketable securities excluding restricted cash. Since our inception, we have incurred significant operating losses. We have not yet commercialized any product candidates, and we do not expect to generate revenue from sales of any product candidates for a few years, if ever. We had an accumulated deficit of $1.6$1.7 billion as of MarchJune 31,30, 2026. From June 29, 2018 (inception) through MarchJune 31,30, 2026, we raised an aggregate of $1.5 billion in gross proceeds primarily from the sales of our convertible preferred stock, our IPO and private placements in July 2025 and March 2026 of our common stock pursuant to the SPA.

In February 2024, we entered into a sales agreement (Sales Agreement) with TD Securities (USA) LLC (formerly known as Cowen and Company, LLC) (TD Cowen) as our sales agent with respect to an at-the-market offering program. In accordance with the terms of the Sales Agreement, we may offer and sell from time to time through TD Cowen shares of our common stock having an aggregate offering amount of up to $150.0 million (the Placement Shares). Sales of the Placement Shares are made at prevailing market prices on Nasdaq at the time of sale, or as otherwise agreed with the Agent, by any method permitted by law deemed to be an “at-the-market offering” as defined in Rule 415 of the Securities Act of 1933, as amended (the Securities Act). We pay commissions to TD Cowen of up to 3% of the gross proceeds of the sale of the Placement Shares sold under the Sales Agreement and reimburse TD Cowen for certain expenses. Neither us nor TD Cowen is obligated to sell any shares. During the threesix months ended MarchJune 31,30, 2026, we sold 65,092 shares of our common stock under the Sales Agreement for net proceeds of approximately $1.7 million. No shares were sold during the three months ended June 30, 2026 or the three and six months ended June 30, 2025.

We continually evaluate our liquidity and capital resources to ensure that we can adequately and efficiently finance our operations. As of MarchJune 31,30, 2026, our material cash requirements consisted primarily of paying salaries and benefits, administering clinical trials, conducting research, improving our manufacturing capabilities, providing the technology and facilities necessary to support our operations, funding operating lease obligations and other payments related to our license and collaboration agreements and the acquisitions of ImmPACT and our LYL273 license. See Note 3, Asset Acquisitions and Contingent Consideration, Note 4, License, Collaboration and Success Payment Agreements, and Note 8, Leases, in the accompanying notes to the unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, for additional information.

During the threesix months ended MarchJune 31,30, 2026, net cash used in operating activities was $38.5$72.4 million, reflecting our net loss of $24.2$68.9 million, in addition to non-cash items primarily related to the gain on the SPA put/call of $17.6 million and non-cash lease income of $1.1$2.3 million, partially offset by stock-based compensation expense of $4.3$8.8 million and depreciation and amortization expense of $2.3$4.6 million. Additionally, changes in net operating assets and liabilities decreasedof $1.1$5.3 million,million whichpartially also contributed tooffset the net cash used in operating activities.

During the threesix months ended MarchJune 31,30, 2025, net cash used in operating activities was $54.7$89.2 million, reflecting our net loss of $52.2$94.9 million, partially offset by $7.0$16.1 million of non-cash items primarily related to stock-based compensation expense of $6.0$11.0 million, depreciation and amortization expense of $3.4$6.6 million and losses on property and equipment disposals of $1.3$3.8 million, partially offset by net amortization and accretion on marketable securities of $1.7$2.9 million and the change in the fair value of our contingent consideration payable of $1.2$2.1 million. Additionally, net operating assets and liabilities decreased $9.6$10.4 million primarily driven by a $9.8$13.1 million decrease in accrued liabilities and other current liabilities, partially offset by a $4.8 million increase in prepaid expenses, other current assets and other assets, which also contributed to the net cash used in operating activities.

During the threesix months ended MarchJune 31,30, 2026 and MarchJune 31,30, 2025, cash provided by investing activities was $17.4$33.0 million and $69.5$82.1 million, respectively, consisting primarily of net maturities and purchases of marketable securities.

During the threesix months ended MarchJune 31,30, 2026, cash provided by financing activities was $51.7$52.2 million, consisting primarily of $50.0 million of proceeds from the issuance of $50.0 million of common stock under the SPA and $1.7 million from our at-the-market equity financing.

During the threesix months ended MarchJune 31,30, 2025, cash provided by financing activities was approximately zero.$0.2 million, consisting of proceeds from the employee stock purchase plan.