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

While we have reported net income in therecent years ended December 31, 2024, 2023 and 2022,years, we cannot assure that we will continue to do so and may not be able to maintain profitability.

We have incurred significant cumulative operating losses since our inception. While we have reported net income in recent years, including the years ended December 31, 2024,2025, 20232024 and 2022,2023, we cannot assure that we will continue to do so and will need to continue to generate significant revenue to sustain operations and successfully commercialize neratinib and develop alisertib. As of December 31, 2024,2025, we had an accumulated deficit of approximately $1,314.9$1,283.8 million, outstanding indebtedness of approximately $67.0$22.5 million and cash and cash equivalents and marketable securities of approximately $101.0$97.5 million.

In 2017, the FDA approved NERLYNX for the extended adjuvant treatment of adult patients with early stage HER2-overexpressed/amplified breast cancer following adjuvant trastuzumab-based therapy. In February 2020, NERLYNX was also approved by the FDA in combination with capecitabine for the treatment of adult patients with advanced or metastatic HER2-positive breast cancer who have received two or more prior anti-HER2-based regimens in the metastatic setting. In 2018, the EC granted a marketing authorization for NERLYNX in the EU for the extended adjuvant treatment of adult patients with early stage hormone receptor positivereceptor-positive HER2-overexpressed/amplified breast cancer and who completed adjuvant trastuzumab-based therapy less than one year ago. We are also in the early stages of development for alisertib. The successful development and commercialization of any drug candidate will require us to perform a variety of functions, including:

In September 2022, we in-licensed alisertib from Takeda. Pursuant to our exclusive license agreement with Takeda, we are responsible for global development and commercialization of alisertib. Clinical development of alisertib will be expensive, lengthy and unpredictable. Failure or delay can occur at any time during the development process. There are numerous risks associated with our planned development alisertib, including,including amongthe othersfollowing:

In addition, FDA and foreign regulatory authorities may change their approval policies and new regulations may be enacted. For instance, the EU pharmaceutical legislation ishas currentlybeen undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020. TheOn April 26, 2023, the European Commission’sCommission published a proposal for revisiona new Directive and Regulation to revise the existing pharmaceutical legislation. The proposed changes were since discussed and negotiated by the European Parliament and the Council of severalthe EU as part of the EU ordinary legislative instrumentsprocess. relatedA toprovisional medicinalagreement productshas been reached by the European Parliament and Council of the EU on the proposed revisions on December 11, 2025. The proposed revisions (potentially reducingaffecting the duration of regulatory data protection and market protection, including for orphan medicinal products, revising the eligibility for expedited pathways, etc.) was published on April 26, 2023. The proposed revisions remain to be agreed andformally adopted by the Europeantwo Parliament and European Council and the proposals may therefore be substantially revised before adoption,institutions, which is not expectedanticipated before early 2026. The revisionsproposed changes are not expected to enter into application before 2028, and may however have a significant impact on the biopharmaceutical industry in the long term.

Disruptions at the FDA and other government agencies caused by funding shortagesshortages, staffing limitations or globalpolicy health concernschanges could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, which could negatively impact our business.

In addition, the current U.S. Presidential administration has issued certain policies and Executive Orders directed towards reducing the employee headcount and costs associated with U.S. administrative agencies, including the FDA, and it remains unclear the degree to which these efforts may limit or otherwise adversely affect the FDA’s ability to conduct routine activities. If a prolonged government shutdown occurs, or if globalfunding healthshortages, concernsstaffing continuelimitations toor similar factors hinder or prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, itsuch events could significantly impact the ability of the FDA or other such regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

The accelerated approval pathway may be used in cases in which the advantage of a new drug over available therapy may not be a direct therapeutic advantage but is a clinically important improvement from a patient and public health perspective. If granted, accelerated approval is usually contingent on the sponsor’s agreement to conduct, in a diligent manner, additional confirmatory studies to verify and describe the drug’s clinical benefit. If such post-approval studies fail to confirm the drug’s clinical benefit or are not completed in a timely manner, the FDA may withdraw its approval of the drug on an expedited basis. In addition, in December 2022, former President Biden signed an omnibus appropriations bill to fund the U.S. government through fiscal year 2023. Included in the omnibus bill is the Food and Drug Omnibus Reform Act of 2022, which among other things, provided the FDA with additional statutory authority to mitigate potential risks to patients from continued marketing of ineffective drugs previously granted accelerated approval. Under these provisions, the FDA may require a sponsor of a product seeking accelerated approval to have a confirmatory trial underway prior to such approval being granted.

Outside the United StatesStates, we rely entirely on third-party sublicenses for the development and commercialization of NERLYNX. For a description of the risks associated with those arrangements see, “—Risks Related to Third Parties—We are dependent on international third-party sub-licensees for the development and commercialization of NERLYNX in several countries outside the United States. The failure of these sub-licensees to meet their contractual, regulatory or other obligations could adversely affect our business.”

The majority of our revenue comes from a limited number of customers. In 2024,2025, fourfive customers individually comprised approximately 28.4%,27.3%, 18.8%,17.0%, 14.1%16.4%, 13.1% and 12.3%10.6%, respectively, of our total product revenue. We expect that revenue from a limited number of customers will continue to account for a large portion of our revenue in the future. The loss by us of any of these customers, or a material reduction in their purchases or their market pricing, could harm our business, results of operations, financial condition and prospects. In addition, if any of these customers were to fail to pay us in a timely manner, it could harm our cash flow.

Outside the United States, we seek to enter into exclusive sub-license agreements with third parties to pursue regulatory approval, if necessary, and commercialize NERLYNX, if approved. As of December 31, 2024,2025, NERLYNX has received approval for the treatment of certain patients with extended adjuvant and/or metastatic HER2-positive breast cancer in more than 40 countries outside the United States, including the EU, Australia, Canada, and Hong Kong. We are currently party to several sub-licenses in various regions outside the United States, including Europe (excluding Russia and Ukraine), Australia, Canada, China, Southeast Asia, Israel, South Korea, Russia and various countries and territories in Central America, South America, Africa and the Middle East and Africa.East. We depend on these third parties for a significant portion of our total revenue. Royalty revenue obtained pursuant to these sub-license agreements was 15%, 14%11% and 12%15% of total revenue for the years ended December 31, 2024, 20232025 and 2022,2024, respectively. We have very little control over these third-parties and any of our existing or future licensees may fail to devote the necessary resources and attention to obtain regulatory approval, where needed, and to market and distribute NERLYNX effectively. If these licensees are unsuccessful in receiving regulatory approvals or in commercializing NERLYNX, our business, results of operations and financial condition will be materially adversely affected. Moreover, we intend to seek additional third parties to sub-license NERLYNX in additional geographies, and may pursue a similar strategy for any future drug candidates that we develop. We cannot assure you that we will be able to enter these agreements on commercial terms, or at all, and our failure to do so would have an adverse effect on our continued commercialization efforts for NERLYNX or any future drug candidates.

The FDA and foreign regulatory authorities strictly regulate marketing, labeling, advertising and promotion of prescription drugs. These regulations include standards and restrictions for direct-to-consumer advertising, industry-sponsored scientific and educational activities, promotional activities involving the internet and off-label promotion. Any regulatory approval that the FDA or foreign regulatory authorities grant is limited to those specific diseases and indications for which a product is deemed to be safe and effective by the FDA and foreign regulatory authorities. For example, the FDA-approved label for NERLYNX is limited to the extended adjuvant treatment of adult patients with early stage, HER2-positive breast cancer following adjuvant trastuzumab-based therapy, and in combination with capecitabine, to the treatment of adult patients with advanced or metastatic HER2-positive breast cancer who have received two or more prior anti-HER2 based regimens in the metastatic setting. In addition to the FDA or foreign regulatory authorities approval required for new formulations, any new indication for an approved product also requires FDA or foreign regulatory authoritiesauthorities' approval. If we are not able to obtain FDA approval for any desired future indications for our drugs and drug candidates, our ability to effectively market and sell our products may be reduced and our business may be adversely affected.

While physicians in the United States and outside the United States may choose, and are generally permitted, to prescribe drugs for uses that are not described in the product’s labeling and for uses that differ from those tested in clinical trials and approved by the regulatory authorities, our ability to promote the products is narrowly limited to those indications that are specifically approved by the FDA or foreign regulatory authorities. These “off-label” uses are common across medical specialties and may constitute an appropriate treatment for some patients in varied circumstances. For example, in April 2018, we announced that NERLYNX (neratinib) has been included as a recommended treatment option in the latest NCCN Clinical Practice Guidelines in Oncology Central Nervous System Cancers for Breast Cancer patients with brain metastases. The NCCN designated NERLYNX in combination with capecitabine as a category 2A treatment option and NERLYNX in combination with paclitaxel as a category 2B treatment option. In addition, in December 2024, we announced that NCCN Clinical Practice Guidelines in Oncology (NCCN Guidelines®) for Cervical Cancer were updated to include an addition involving neratinib. The updated NCCN Practice Guidelines for Cervical Cancer include neratinib monotherapy for use as second-line or subsequent therapy for recurrent or metastatic disease as an option for patients with HER2-mutated tumors with a designation of Categorycategory 2A. The NCCN Guidelines Category of Preference is designated as “useful in certain circumstances” as a treatment option for patients with HER2-mutated tumors. Use, as designated for breast cancer patients with brain metastases and in Cervical Cancer, is outside the FDA approved indication for NERLYNX and considered investigational, and we do not market or promote NERLYNX for these uses.

Regulatory authorities in some jurisdictions, including the U.S., may designate drugs designed to address relatively small patient populations as “orphan drugs.” Under the Orphan Drug Act, the FDA may grant orphan drug designation to a drug intended to treat a rare disease or condition, which is defined as one occurring in a patient population of fewer than 200,000 in the United States, or a patient population greater than 200,000 in the United States, where there is no reasonable expectation that the cost of developing the drug or biologic will be recovered from sales in the United States. In the U.S., orphan designation entitles a party to financial incentives such as opportunities for grant funding for clinical trial costs, tax advantages and user-fee waivers. In addition, if a drug candidate that has orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any other applications, including an NDA, to market the same drug for the same approved indication or use within the same rare disease or condition for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity in the relevant indication or use or where the manufacturer is unable to assure sufficient product quantity.

We may decide to seek Orphan Drug Designations for alisertib. There can be no assurances that we will be able to obtain such designations. Even if we, or any future collaborators, obtain orphan drug designation for a drug candidate, we, or they, may not be able to obtain or maintain orphan drug exclusivity for that drug candidate. Further, even if we, or any future collaborators, obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different drugs with different active ingredients may be approved for the same indication or use within the same rare disease or condition. Even after an orphan drug is approved, the FDA can subsequently approve the same drug for the same disease or condition if the FDA concludes that the later drug is clinically superior in the relevant indication, in that it is shown to be safer, more effective or makes a major contribution to patient care, or the manufacturer of the product with orphan exclusivity is unable to maintain sufficient product quantity.quantity to meet the needs of the approved indication or use for the patients with the relevant disease or condition. Orphan drug designation neither shortens the development or regulatory review time of a drug nor gives the drug any advantage in the regulatory review or approval process.

In March 2010, the Affordable Care Act (“ACA”) became law in the United States. The ACA substantially changed the way healthcare is financed by both governmental and private insurers and significantly affects the pharmaceutical industry. Among other provisions, the ACA included an annual, nondeductible fee on any entity that manufactures or imports certain branded prescription drugs and biologic agents and a new formula that increases the rebates a manufacturer must pay under the Medicaid Drug Rebate Program. Since its enactment, there have been judicial, executive and Congressional challenges to certain aspects of the ACA. On June 17, 2021, the U.S. Supreme Court dismissed the most recent judicial challenge to the ACA brought by several states without specifically ruling on the constitutionality of the ACA. Thus, the ACA will remain in effect in its current form.

In addition, other legislative changes have been proposed and adopted in the United States since the ACA was enacted. For example, the Budget Control Act of 2011, among other things, led to reductions to Medicare payments to providers that will remain in effect through 2032. On January 2, 2013, theThe American Taxpayer Relief Act of 2012, among other things, also reduced Medicare payments to several providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years. More recently, on March 11, 2021, President Biden signed theThe American Rescue Plan Act of 2021 into law, which eliminated the statutory Medicaid drug rebate cap, beginning January 1, 2024. The rebate was previously capped at 100% of a drug’s average manufacturer price, MostThe significantly,IRA was enacted in August 2022, President Biden signed the Inflation Reduction Act of 2022 (“IRA”) into law.2022. This statute marks the most significant action by Congress with respect to the pharmaceutical industry since adoption of the ACA in 2010. Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare, with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); redesigns the Medicare Part D benefit (beginning in 2024); and replaces the Part D coverage gap discount program with a new manufacturer discount program (beginningwhich began in 2025). U.S.The Centers for Medicare & Medicaid Services (“CMS”) has published the negotiated prices for the initial 10ten drugs, which went into effect in January 2026, and the subsequent 15 drugs, which will first be effective in 2026,2027. andCMS has also published the listnext set of the subsequent 15 drugs that will be subject to negotiation. The IRA permits the Secretary of the Department of Health and Human Services (“HHS”) to implement many of these provisions through guidance, as opposed to regulation, for the initial years. HHS has and will continue to issue and update guidance as these programs are implemented, although the Medicare drug price negotiation program is currently subject to legal challenges. The impact of the IRA on us and the pharmaceutical industry cannot yet be fully determined but is likely to be significant.

Under the IRA manufacturer discount program that replaced the coverage gap discount program as of January 1, 2025, manufacturers must give a 10 percent discount on Part D drugs in the initial coverage phase, and a 20 percent discount on Part D drugs in the so-called “catastrophic phase” (the phase after the patient incurs costs above the initial phase out-of-pocket threshold, which will be $2,000 beginning in 2025). The IRA allows the 10 and 20 percent discounts to be phased in over time for certain drugs for “specifiedmanufacturers manufacturers.”that CMS deems to meet specific criteria. In April 2024, CMS informed us that we are deemed a specified small manufacturermanufacturer, and as a result, the discountdiscounts will be phased in over several years and will increase over time. We are continuing to evaluate the potential impact of this status on our future revenues.

NERLYNX is reimbursed under Medicare Part D, and the reimbursement amount will be impacted by the 10 and 20 percent discounts under the IRA’s new discounting program (as noted above). We anticipate that these increased discounts will impact NERLYNX revenues over time, while also having an industry-wide impact on the patient out-of-pocket costscost of Part D drugs. The impact on NERLYNX revenues could be offset because the IRA’s redesign of certain Part D components, some of which went into effect in 2024, resulted in an increase in the number of patients able to afford this therapy. The amount of the offset, if any, is inherently uncertain and difficult to predict.

TheIn addition, the cost of prescription pharmaceuticals in the United States has also been the subject of considerable discussion. There have been several Congressional inquiries, as well as legislative and regulatory initiatives and executive orders designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drug products. We cannot predict with certainty what impact any federal or state health reforms will have on us, but such changes could impose new or more stringent regulatory requirements on our activities or result in reduced reimbursement for our products, any of which could adversely affect our business, results of operations and financial condition.

IndividualMoreover, individual states in the United States have also become increasingly active in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access andaccess, marketing cost disclosuredisclosure, drug price reporting and other transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. Some states have enacted legislation creating so-called prescription drug affordability boards, which ultimately may attempt to impose price limits on certain drugs in these states.states, and at least one state board is imposing an upper payment limit. States are also seeking to implement general, across the board price caps for pharmaceuticals, or are seeking to regulate drug distribution. In addition, 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 have entered into exclusive sub-license agreements with several third parties that provide these sub-licensees exclusive rights to the development and commercialization of NERLYNX in Europe (excluding Russia and Ukraine), Australia, Canada, China, Southeast Asia, Israel, South Korea, Russia and various countries and territories in Central America, South America, Africa and the Middle East and Africa.East. As a result, we are entirely dependent on these parties to achieve regulatory approval of NERLYNX for marketing in these countries and for the commercialization of NERLYNX, if approved. For the years ended December 31, 2024,2025, 20232024 and 2022,2023, royalty revenue from these sub-licensees was $35.3$24.3 million, $32.5$35.3 million and $28.0$32.5 million, respectively, and represented 15%,11%, 14%15% and 12%14% of total revenue, respectively. The timing and amount of any milestone and royalty payments we may receive under these agreements, as well as the commercial success of NERLYNX in those regions outside of the United States, will depend on, among other things, the efforts, allocation of resources and successful commercialization of NERLYNX by the licensees. We also depend on these third parties to comply with all applicable laws relative to the development and commercialization of our products in those countries. We do not control the individual efforts of these licensees and have limited ability to terminate these agreements if the licensees do not perform as anticipated. The failure of these licensees to devote sufficient time and effort to the development and commercialization of NERLYNX; to meet their obligations to us, including for future royalty and milestone payments; to adequately deploy business continuity plans in the event of a crisis; and/or to satisfactorily resolve significant disagreements with us or address other factors could have an adverse impact on our financial results and operations. In addition, if these third parties violate, or are alleged to have violated, any laws or regulations during the performance of their obligations for us, it is possible that we could suffer financial and reputational harm or other negative outcomes, including possible legal consequences.

OurWe rely on computer systems, hardware, software, technology infrastructure and online sites and networks for both internal computerand external operations that are critical to our business. We own and manage some of these information technology systems but also rely on third parties for a range of information technology systems and related products and services. We and certain of our third-party providers collect, maintain and process data about customers, employees, business partners and others, including personally identifiable information, as well as proprietary information belonging to our business such as trade secrets. Our information technology systems and those of third parties with which we contract may be vulnerable to damage from diverse threat vectors, including cyberattacks, “phishing” attacks and other social engineering schemes, employee theft or misuse, human error, fraud, denial or degradation of service attacks, computer viruses, malware (e.g. ransomware), sophisticated nation-state and nation-state-supported actors, unauthorized access or use by persons inside our organization or persons with access to systems inside our organization, hacking, natural disasters, terrorism, war and telecommunication and electrical failures despite the implementation of security measures. We are also vulnerable to other cybersecurity risks and threats, including malicious code embedded in open-source software, or misconfigurations, “bugs” or other vulnerabilities in commercial software that is integrated into our (or our suppliers’ or service providers’) information technology systems, products or services. Attacks upon information technology systems are increasing in their frequency, levels of persistence, sophistication and intensity, and are being conducted by sophisticated and organized groups and individuals with a wide range of motives and expertise. We may also face increased cybersecurity risks due to our reliance on internet technology and the number of our employees who are working remotely, which may create additional opportunities for cybercriminals to exploit vulnerabilities. Furthermore, because the techniques used to obtain unauthorized access to, or to sabotage, systems change frequently and often are not recognized until launched against a target, we may be unable to anticipate these techniques or implement adequate preventative measures. We may also experience security breaches that may remain undetected for an extended period. Even if identified, we may be unable to adequately investigate or remediate incidents or breaches due to attackers increasingly using tools and techniques – including artificial intelligence – that are designed to circumvent controls, to avoid detection, and to remove or obfuscate forensic evidence. System failures, accidents or security breaches could cause interruptions in our operations and could result in a material disruption of our clinical activities and business operations, in addition to possibly requiring substantial expenditures of resources to remedy. The loss of clinical trial data could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. Furthermore, any integration of artificial intelligence in our or any third party’s operations, products or services is expected to pose new or unknown cybersecurity risks and challenges. To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability and our research and development programs, and the development of our drug candidates could be delayed.

The risk of a security breach or disruption, particularly through cyberattacks or cyber intrusion, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased and evolved. If we or our third-party vendors were to experience a significant cybersecurity breach of our or their information systems or data, the costs associated with the investigation, remediation and potential notification of the breach to counterparties and data subjects could be material. In addition, our remediation efforts may not be successful. There can also be no assurance that our cybersecurity risk management program and processes, including our policies, controls or procedures, will be fully implemented, complied with or effective in protecting our information technology systems and confidential information. If we do not allocate and effectively manage the resources necessary to build and sustain the proper technology and cybersecurity infrastructure, we could suffer significant business disruption, including transaction errors, supply chain or manufacturing interruptions, processing inefficiencies, data loss or the loss of or damage to intellectual property or other proprietary information.

We and certain of our service providers are from time to time subject to cyberattacks and security incidents.incidents that threaten the confidentiality, integrity and availability of our information technology systems and confidential information. While we do not believe that we have experienced any significant system failure, accident or security breach to date, if such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our development programs and our business operations, whether due to a loss, corruption or unauthorized disclosure of our trade secrets, personal information or other proprietary or sensitive information or other similar disruptions. It could also expose us to risks, including an inability to provide our services and fulfill contractual demands, and could cause management distraction and the obligation to devote significant financial and other resources to mitigate such problems, which would increase our future information security costs, including through organizational changes, deploying additional personnel, reinforcing administrative, physical and technical safeguards, further training of employees, changing third-party vendor control practices and engaging third-party subject matter experts and consultants and reduce the demand for our technology and services.

If a security breach or other incident were to result in the unauthorized access to or unauthorized use, disclosure, release or other processing of personal information, it may be necessary to notify individuals, governmental authorities, supervisory bodies, the media and other parties pursuant to privacy and security laws. Any security compromise affecting us, our service providers, strategic partners, other contractors, consultants, or our industry, whether real or perceived, could harm our reputation, erode confidence in the effectiveness of our security measures and lead to regulatory scrutiny. To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or systems, or inappropriate disclosure of confidential or proprietary or personal information, we could incur liability, includingsuch as litigation exposure,exposure (including class actions), penalties and fines, we could become the subject of regulatory action or investigation, our competitive position could be harmed and the further development and commercialization of our products and services could be delayed. If such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our business. Furthermore, federal, state and international laws and regulations can expose us to enforcement actions and investigations by regulatory authorities, and potentially result in regulatory penalties, fines and significant legal liability, if our information technology security efforts fail. We may also be exposed to a risk of loss or litigation and potential liability, which could materially and adversely affect our business, results of operations or financial condition. We maintain cyber liability insurance; however, this insurance may not be sufficient to cover the financial, legal, business or reputational losses that may result from an interruption or breach of our systems.

CertainA number of U.S. states have also enacted data privacy and security laws and regulations, which govern the privacy, processing and protection of health-related and other personal information. Such laws and regulations will be subject to interpretation by various courts and other governmental authorities, thus creating potentially complex compliance issues for us and our future customers and strategic partners. For example, the California Consumer Privacy Act of 2018, as amended by the California Privacy Rights Act (collectively, the "CCPA") requires covered businesses that process the personal information of California residents to, among other things: (i) provide certain disclosures to California residents regarding the business’s collection, use, and disclosure of their personal information; (ii) receive and respond to requests from California residents to access, delete, and correct their personal information, or to opt out of certain disclosures of their personal information; and (iii) enter into specific contractual provisions with service providers that process California residents` personal information on the business’s behalf. Further, Washington State enacted a broadly applicable law to protect the privacy of personal health information known as the “My Health My Data Act,” which generally requires affirmative consent for the collection, use, or sharing of any “consumer health data.” Consumer health data is defined to include personal information that is linked or reasonably linkable to a consumer and that identifies a consumer’s past, present, or future physical or mental health status; consumer health data also includes information that is derived or extrapolated from non-health information, such as algorithms and machine learning. Other states, including Connecticut and Nevada, have also passed consumer health data laws,laws and given the increased focus on the use of health data by entities that are not subject to HIPAA, additional states are expected to pass consumer health privacy laws. Additional compliance investment and potential business process changes may also be required. Similar laws have been passed in other states and are continuing to be proposed at the state and federal level,states, reflecting a trend toward more stringent privacy legislation in the United States. The enactment of such laws could have potentially conflicting requirements that would make compliance challenging. Compliance with these privacy and data security requirements is rigorous and time-intensive and may increase our cost of doing business; despite those efforts, there is a risk that we may be subject to fines and penalties, litigation and reputational harm, which could materially and adversely affect our business, financial condition and results of operations.

In addition, the regulatory framework for the receipt, collection, processing, use, safeguarding, sharing and transfer of personal and confidential data is rapidly evolving and is likely to remain uncertain for the foreseeable future as new global privacy rules are being enacted and existing ones are being updated and strengthened. For example, onwe Maymay 25,be 2018,subject to the European UnionEU General Data Protection Regulation (“EU GDPR”) tookand effectto inthe Europe.United Kingdom General Data Protection Regulation and Data Protection Act 2018 (collectively, the “UK GDPR”) (the EU GDPR and UK GDPR together referred to as the “GDPR”). The GDPR is directly applicable in each European UnionEU and EEA member state and the UK and applies to companies established in the European UnionEU and the EEA or UK as well as companies that collect and use personal data to offer goods or services to, or monitor the behavior of, individuals in the European UnionEU and the EEA.EEA or UK. The GDPR imposes stringent data protection obligations for processors and controllers of personal data, and penalties and fines for failure to comply with GDPR are significant, including fines of up to €20 million / £17.5 million or 4% of total worldwide annual turnover, whichever is greater. Among other requirements, the GDPR regulates transfers of personal data subject to the GDPR to third countries that have not been found to provide adequate protection to such personal data, including the United States, and the efficacy and longevity of current transfer mechanisms between the EEA and the United States remains uncertain. Case law from the Court of Justice of the European Union (“CJEU”) states that reliance on the standard contractual clauses – a standard form of contract approved by the European Commission as an adequate personal data transfer mechanism alone may not necessarily be sufficient in all circumstances and that transfers must be assessed on a case-by-case basis The European Commission adopted its Adequacy Decision in relation to the DPF on July 10, 2023, rendering the DPF effective as a GDPR transfer mechanism to U.S. entities self-certified under the DPF. The DPF also introduced a new redress mechanism for EU citizens which addresses a key concern in the previous CJEU judgments and may mean transfers under standard contractual clauses are less likely to be challenged in future. We currently rely on the EU standard contractual clauses to transfer personal data outside the EEA and the UK, including to the United States, with respect to both intragroup and third-party transfers. We expect the existing legal complexity and uncertainty regarding international personal data transfers to continue. In particular, we expect the DPF Adequacy Decision to be challengedcontinue and international transfers to the United States and to other jurisdictions more generally to continue to be subject to enhanced scrutiny by regulators. As athe result,regulatory we may have to make certain operational changesguidance and weenforcement willlandscape havein relation to implement revised standard contractual clauses and other relevant documentation for existing data transfers withincontinue requiredto timedevelop, frames.we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we operate our business, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.

In the past, securities class action litigation has often been brought against a company following periods of volatility in the market price of its securities. This risk is especially relevant for us because pharmaceutical companies have experienced significant stock price volatility in recent years. These types of lawsuits are subject to inherent uncertainties, and are expensive and time-consuming to investigate, defend and resolve. For instance, in Hsu v. Puma Biotechnology, Inc., the plaintiff alleged that weresolve, and certain of our executive officers made false or misleading statements and failed to disclose material adverse facts about our business, operations, prospects and performance in violation of the Exchange Act. In February 2019, a jury found that three of the four challenged statements were not false and misleading, and thus found in the defendants'past, favorwe onhave thosebeen claims.a In December 2021, the Court issued an order preliminarily approving the parties’ settlement which provides for two installment payments by us of approximately $27.1 million each, which were paiddefendant in Januarysuch and June 2022. On August 3, 2022, the Court ordered final approval of the parties’ settlement and dismissed the case, and the matter is now concluded.lawsuits. Any other litigation to which we are a party may similarly divert our management’s attention and financial and other resources or result in an onerous or unfavorable judgment that may not be reversed upon appeal or in payments of substantial monetary damages or fines. Additionally, we may decide to settle such lawsuits on similarly unfavorable terms, which could adversely affect our business, financial condition, results of operations or stock price.

Additionally, valuation allowances needed for deferred tax assets that we estimate are more likely than not to be unusable, based on available evidence at the time the estimate is made. For the year ended December 31, 2024,2025, we releasedrecorded $7.1a partial release of $3.8 million of our valuation allowance related to deferred tax assets, andresulting recordedin a total valuation allowance of $343.5$324.8 million as of December 31, 2024.2025. See Note 12–Income Taxes in the notes to the financial statements included in this Annual Report for further information. The recording of any future increase in or release of all or any portion of our valuation allowance could have a material impact on our reported results and could cause fluctuations in our quarterly and annual results of operations. Moreover, potential changes in the tax law or in our projections could impact our assessment and valuation allowance estimates, which could have a material adverse effect on our business, financial condition and results of operations.

This Annual Report on Form 10-K contains forward-looking statements within the meanings of the federal securities laws. These statements are subject to risks and uncertainties that could cause actual results and events to differ materially from those expressed or implied by such forward-looking statements. For a detailed discussion of these risks and uncertainties, see the “Risk Factors” section in Item 1A of Part I of this FormAnnual 10-K.Report. We caution the reader not to place undue reliance on these forward-looking statements, which reflect management’s analysis only as of the date of this FormAnnual 10-K.Report. We undertake no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this FormAnnual 10-K.Report.

We are a biopharmaceutical company that develops and commercializes innovative products to enhance cancer care and improve treatment outcomes for patients. We are currently commercializing NERLYNX, an oral version of neratinib, for the treatment of certain HER2-positive breast cancers. Additionally, in 2022, we in-licensedhave in-licensed, and becameare responsible for the global development and commercialization ofof, alisertib. Alisertib is a selective, small-molecule inhibitor of Aurora Kinase A that is designed to disrupt mitosis leading to apoptosis of rapidly proliferating tumor cells that are dependent on Aurora Kinase A. Prior to our licensing alisertib from Takeda, alisertib was tested in over 1,300 patients who were treated across 22 company-sponsored trials resulting in a large, well-characterized clinical safety database. Based on information in this database, we believe alisertib has potential application in the treatment of a range of different cancer types, including hormone receptor-positive breast cancer, triple-negativetriple negative breast cancer and small cell lung cancer. We intend to pursue development of alisertib initially in small cell lung cancer and hormone receptor-positive breast cancer.

We currently market NERLYNX in the United States using our direct specialty sales force consisting of approximately 35 sales specialists. Our sales specialists are supported by an experienced sales leadership team consisting of severalfive regional business leaders a Senior Vice President of Sales and a VPSenior Vice President of sales,Marketing, as well as experienced professionals in marketing, managed markets, access and reimbursement, research, and sales planning and operations. Outside the United States, we seek to enter into exclusive sub-license agreements with third parties to pursue regulatory approval, if necessary, and commercialize NERLYNX, if approved. As of December 3131, 2024,2025, NERLYNX has received approval for the treatment of certain patients with extended adjuvant and/or metastatic HER2-positive breast cancer in over 40 countries outside the United States. We are currently party to several sub-licenses in various regions outside the United States, including Europe (excluding Russia and Ukraine), Australia, Canada, China, Southeast Asia, Israel, South Korea, Russia and various countries and territories in Central America, South America, Africa and the Middle East.

In September 2022, we entered into an exclusive license agreement with Takeda to license the worldwide research and development and commercial rights to alisertib. Alisertib is an investigational, reversible, ATP-competitive inhibitor that is designed to be highly selective for Aurora Kinase A. Inhibition of Aurora Kinase A can lead to disruption of mitotic spindle apparatus assembly, disruption of chromosome segregation, and inhibition of cell proliferation. In clinical trials to date, alisertib has shown single agent activity and activity in combination with other cancer drugs in the treatment of many different types of cancers, including hormone receptor-positive breast cancer, triple-negativetriple negative breast cancer, small cell lung cancer and head and neck cancer. We initiated the ALISertib in CAncer (ALISCA™ -Lung1) Phase II trial (PUMA-ALI-4201) of alisertib monotherapy for the treatment of patients with extensive stage small cell lung cancer in February 2024, and we commenced the ALISCA™ -Breast1 Phase II trial (PUMA-ALI-1201) in the fourth quarter ofNovember 2024.

Under the terms of the exclusive license agreement, we assumed sole responsibility for the global development and commercialization of alisertib. We paid Takeda an upfront license fee of $7.0 million in October 2022, and it is eligible to receive potential future milestone payments of up to $287.3 million upon our achievement of certain regulatory and commercial milestones over the course of the exclusive license agreement, as well as tiered royalty payments for any net sales of alisertib. We recorded in-process research and development expense of $7.0 million during the year ended December 31, 2022, in connection with the up-frontupfront payment related to the asset acquisition. As of December 31, 2024,2025, no milestones had been accrued as the underlying contingencies were not probable or estimable.

Our expenses to date have been related to hiring staff, commencing company-sponsored clinical trialstrials, and the buildbuilding out of our corporate infrastructure and, since 2017, the commercial launch of NERLYNX. Going forward, we anticipate significant expenses as we continue to develop alisertib in 2025.2026. Accordingly, our success depends not only on the safety and efficacy of our drug candidates, but also on our ability to finance product development. To date, our major sources of working capital have been proceeds from product and license revenue, public offerings of our common stock, proceeds from our credit facility and sales of our common stock in private placements. We intend to satisfy our near-term liquidity requirements through a combination of our existing cash and cash equivalents and marketable securities as of December 31, 2024,2025, and proceeds that will become available to us through product sales, royalties and sub-license milestone payments. However, this intention is based on assumptions that may prove to be wrong. Changes may occur that would consume our available capital faster than anticipated, including changes in and progress of our development activities, the impact of commercialization efforts, acquisitions of additional drug candidates and changes in regulation. Some of these developments have had and may continue to have an adverse effect on our revenue and thus could have an adverse effect on our ability to satisfy the minimum revenue and cash balance covenants contained in the Athyrium Notes.

Research and development expenses (“R&D expenses”) include costs associated with services provided by consultants who conduct and perform clinical services on our behalf and contract organizations for the manufacturing of clinical materials. During the years ended December 31, 2024,2025, 20232024 and 2022,2023, our R&D expenses consisted primarily of CRO fees, manufacturing of clinical materials, fees paid to consultants, salaries and related personnel costs and stock-based compensation. We expense our R&D expenses as they are incurred. Internal R&D expenses primarily consist of payroll-related costs and also include equipment costs, travel expenses and supplies. We expect R&D expenses to increase in 20252026 as we conductexpand twothe Phase II clinical trialsdevelopment of alisertib.

The following summarizes our results of operations for the years ended December 31, 20242025 and 2023.2024. For discussion related to the results of operations and changes in financial condition for the year ended December 31, 2023,2024, compared to the year ended December 31, 2022,2023, please refer to Item 7 of Part II, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the Yearyear Endedended December 31, 2023,2024, which was filed with the United States Securities and Exchange CommissionSEC on February 29,27, 2024.2025.

Total revenue was approximately $228.4 million for the year ended December 31, 2025, compared to $230.5 million for the year ended December 31, 2024, compared to $235.6 million for the year ended December 31, 2023.2024. This decrease in total revenue of $5.2$2.1 million was due to a decrease in productroyalty revenue, netrevenue of approximately $7.9$11.0 million, partially offset by an increase in royaltyproduct revenuerevenue, net of $2.8approximately $8.9 million.

Product revenue, net was approximately $204.1 million for the year ended December 31, 2025, compared to $195.2 million for the year ended December 31, 2024, compared to $203.1 million for the year ended December 31, 2023.2024. The decreaseincrease in product revenue, net was primarily attributable to a volume decreaseincrease of approximately 8.7%5.5% in bottles of NERLYNX sold,sold partially offset byand an increase in net selling price. Reserves for variable consideration were approximately 19.5%24.3% and 17.9%19.5% of product revenue for the years ended December 31, 20242025 and 2023,2024, respectively. The increase in the variable consideration (gross-to-net reserve) was primarily due to priorgovernment yearchargebacks adjustmentsand relatedpayor to lower Medicaid claims.mix.

Royalty revenue was approximately $24.3 million for the year ended December 31, 2025, compared to $35.3 million for the year ended December 31, 2024, compared to $32.5 million for the year ended December 31, 2023.2024. The increasedecrease was due to increaseddecreased product sales by our sub-licensees as they increased commercialization of NERLYNX in international territories, primarily in China.

Cost of sales was approximately $58.2 million for the year ended December 31, 2025, compared to $64.4 million for the year ended December 31, 2024,2024. comparedThe to $62.7$6.2 million for the year ended December 31, 2023. The $1.7 million increasedecrease was primarily due to the increasedecrease of product unit sales to our sub-licensees and the related cost of sales (primarily sales in China), partially offset by lowerhigher domestic sales.

Total R&D expenses increasedwere approximately 9.0%$62.1 tomillion and $54.9 million for the yearyears ended December 31, 20242025 from approximately $50.4 million for the year endedand December 31, 2023.2024. The increase is primarily attributable to the following:

For the year ended December 31, 2024,2025, we recognized approximately $4.7$4.1 million in interest income compared to approximately $2.6$4.7 million of interest income for the year ended December 31, 2023.2024. The $2.1$0.6 million increasedecrease in interest income was primarily the result of increasedlower balancesinterest in cash equivalentsrates and marketabletiming securities.of investments.

For the year ended December 31, 2024,2025, we recognized approximately $12.5$6.6 million in interest expense compared to approximately $13.3$12.5 million of interest expense for the year ended December 31, 2023.2024. The approximately $0.9$5.8 million decrease in interest expense was dueprimarily related to a lower debt balance related to the pay down ofour debt inprincipal 2024 as well as ending imputed interest on $8.0 million related toduring the finalyear installmentended paymentDecember on31, the Eshelman litigation settlement paid in October 2024.2025.

Deferred incomeCurrent tax benefitexpense

In the fourth quarter of 2025, Puma recorded a $7.1 million income tax expense, offset by a $3.8 million partial release of a valuation allowance resulting in a non-cash, deferred tax expense of approximately $3.2 million. In 2024, we released a portion of our valuation allowance related to our deferred tax assets in the amount of $7.1 million, which significantly increased our net income for the year.

Net cash provided by operating activities for the year ended December 31, 20242025 was $38.9$41.8 million which consisted of net income of $30.3$31.1 million, adjusted for non-cash items of approximately $19.3$20.6 million, including stock-based compensation of $8.2$6.9 million, and depreciation and amortization of $11.5$10.9 million, deferred income taxes of $3.2 million and recovery of credit loss of $0.5$0.4 million. Total changes in cash flows from operations were due to a change in working capital related primarily to aan decreaseincrease in accrued expenses of approximately $15.8$13.2 million, ana increasedecrease in inventory of approximately $1.6$3.2 millionmillion, (offset by an increase in inventoryaccounts purchases),receivable offsetof by$21.3 million, a decrease in accountspost-marketing receivablecommitment related to collectionliability of royalties$2.4 receivable.million and a decrease in operating lease assets and liabilities, net of $1.8 million.

Net cash provided by operating activities for the year ended December 31, 20232024 was $27.0$38.9 million which consisted of net income of $21.6$30.3 million, adjusted for non-cash items of approximately $23.3$12.1 million, including stock-based compensation of $10.2$8.2 million, and depreciation and amortization of $11.5 million,million provisionand recovery of credit loss of $0.9 million and loss on impairment of a right-of-use (“ROU”) asset of $0.6$0.5 million. Total changes in cash flows from operations were due to changesa change in working capital andrelated primarily related to an increase in inventory of approximately $2.6 million (increase in inventory purchases) and an increase in accounts receivable, net of approximately $8.4 million (increase and timing of fourth quarter total revenues) and a decrease in accrued expenses of approximately $7.6$15.8 million.million, an increase in inventory of approximately $1.6 million (increase in inventory purchases), offset by a decrease in accounts receivable of $16.3 million, primarily related to collection of royalties receivable.

We issued senior notes for an aggregate principal amount of $100.0 million pursuant to the note purchase agreement,agreement dated July 23, 2021 by us, and our subsidiary, and Athyrium, as Administrative Agent, and certain other investor parties (the “Note Purchase Agreement”), with an initial maturity date of July 23, 2026 (the “Athyrium Notes”). The Athyrium Notes were issued for face amount of $100.0 millionmillion, net of an original issue discount of $1.5 million. The Athyrium Notes also require a 2.0% exit payment to be made on each payment of principal. The borrowings under the Athyrium Notes, together with cash on hand, were used to repay our outstanding indebtedness, including the applicable exit and prepayment fees owed to lenders under our prior credit facility with Oxford. The Athyrium Notes are secured by substantially all of our assets. We incurred $1.9 million of deferred financing costs with the initial borrowing of the Athyrium Notes.

We also engage with CROs and contract manufacturing organizations (“CMOs”) in addition to engaging in contracts for the management of itsour ongoing clinical trials and pre-commercialization efforts. We may cancel these agreements with a 30 to 45 day written notice to the outside vendor. We would be obligated to pay for services rendered up to that point, which amounts to total contractual obligations of $42.3$54.9 million within the next twelve months. The contracts also contain variable costs that are hard to predict as they are based on such things as patients enrolled and clinical trial sites, which can vary, and therefore, are not included in the total obligations amount. The remaining milestone amounts were not included in the table above as the timing of when or if these payments will be made is uncertain. As of December 31, 2024,2025, our obligations for potential milestone payments totaled approximately $16.3$15.7 million.Thismillion. This amount will be paid by us if all milestones are reached and would reduce the overall contractual obligation if one or more milestone is never reached.

The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized under the contract will not occur in a future period. Our analyses also contemplated application of the constraint in accordance with the guidance, under which itwe determined a significant reversal of revenue would not occur in a future period for the estimates detailed below as of December 31, 20242025 and, therefore, the transaction price was not reduced further during the year ended December 31, 2024.2025. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from our estimates, we will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known.

We contract with certain private payor organizations, primarily insurance companies and pharmacy benefit managers, for the payment of rebates with respect to utilization of itsour products. We estimate these rebates and record such estimates in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability.

We recognize license revenue under certain of our sub-license agreements that are within the scope of ASC 606. The terms of these agreements may contain multiple performance obligations, which may include licenses and research and development activities. We evaluate these agreements under ASC 606 to determine the distinct performance obligations. Non-refundable, up-frontupfront fees that are not contingent on any future performance and require no consequential continuing involvement by us, are recognized as revenue when the license term commences and the licensed data, technology or product is delivered. We defer recognition of non-refundable upfront license fees if the performance obligations are not satisfied.

SegmentASU Reporting2023-09, Improvements to Income Tax Disclosures

In November 2024, the FASB issued ASU 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures: The ASU requires more detailed information about specified categories of expenses included in certain expense captions presented on the face of the income statement. This ASU is effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments may be applied either (1i) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2ii) retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact of adopting this ASU on itsour consolidated financial statements and related disclosures.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the notes thereto included in Item 1 in this Quarterly Report on Form 10-Q,10-Q (this “Quarterly Report”). The following discussion should also be read in conjunction with our audited consolidated financial statements and the notes thereto and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2025.

We are a biopharmaceutical company that develops and commercializes innovative products to enhance cancer care and improve treatment outcomes for patients. We are currently commercializing NERLYNX, an oral version of neratinib, for the treatment of certain HER2-positive breast cancers. Additionally, in 2022, we in-licensed and became responsible for the global development and commercialization of alisertib. Alisertib is a selective, small-molecule inhibitor of Aurora Kinase A that is designed to disrupt mitosis leading to apoptosis of rapidly proliferating tumor cells that are dependent on Aurora Kinase A. Prior to our licensing alisertib from Takeda, alisertib was tested in over 1,300 patients who were treated across 22 company-sponsored trials resulting in a large, well-characterized clinical safety database. Based on information in this database, we believe alisertib has potential application in the treatment of a range of different cancer types, including hormone receptor-positive breast cancer, triple-negative breast cancercancer, and small cell lung cancer. We intend to pursue development of alisertib initially in small cell lung cancer and hormone receptor-positive breast cancer.

We currently market NERLYNX in the United States using our direct specialty sales force consisting of approximately 3538 sales specialists as of DecemberJune 31,30, 2025.2026. Our sales specialists are supported by an experienced sales leadership team consisting of regional managers and directors, as well as a commercial team of experienced professionals in marketing, access and reimbursement, managed markets, marketing research, commercial operations and sales force planning and management. Outside the United States, we seek to enter into exclusive sub-license agreements with third parties to pursue regulatory approval, if necessary, and commercialize NERLYNX, if approved. As of MarchJune 31,30, 2026, NERLYNX has received approval for the treatment of certain patients with extended adjuvant or metastatic HER2-positive breast cancer in over 60 countries outside the United States. We are currently party to several sub-licenses in various regions outside the United States, including Europe (excluding Ukraine), Australia, Canada, China, Southeast Asia, Israel, South Korea, Russia and various countries and territories in Central America, South America, Africa and the Middle East.

In September 2022, we entered into an exclusive license agreement with Takeda Pharmaceutical Company Limited (“Takeda”) to license the worldwide research and development and commercial rights to alisertib. Alisertib is an investigational, reversible, ATP-competitive inhibitor that is designed to be highly selective for Aurora Kinase A. Inhibition of Aurora Kinase A can lead to disruption of mitotic spindle apparatus assembly, disruption of chromosome segregation, and inhibition of cell proliferation. In clinical trials to date, alisertib has shown single agent activity and activity in combination with other cancer drugs in the treatment of many different types of cancers, including hormone receptor-positive breast cancer, triple-negative breast cancer, small cell lung cancer and head and neck cancer. We initiated the ALISertib in CAncer (ALISCA™® -Lung1) Phase II trial (PUMA-ALI-4201) of alisertib monotherapy for the treatment of patients with extensive stage small cell lung cancer in February 2024, and we commenced the ALISCA™ -Breast1 Phase II trial (PUMA-ALI-1201) in November 2024.

Under the terms of the exclusive license agreement, we assumed sole responsibility for the global development and commercialization of alisertib. We paid Takeda an upfront license fee of $7.0 million in October 2022, and it is eligible to receive potential future milestone payments of up to $287.3 million upon our achievement of certain regulatory and commercial milestones over the course of the exclusive license agreement, as well as tiered royalty payments for any net sales of alisertib. We recorded in-process research and development expense of $7.0 million during the year ended December 31, 2022 in connection with the upfront payment related to the asset acquisition. As of MarchJune 31,30, 2026, no milestones had been accrued as the underlying contingencies were not probable.

Our expenses to date have been related to hiring staff, commencing company-sponsored clinical trials, building out of our corporate infrastructure and, since 2017, the commercial launch of NERLYNX. Going forward, we anticipate significant expenses as we continue to develop alisertib in 2026. Accordingly, our success depends not only on the safety and efficacy of our drug candidates, but also on our ability to finance product development. To date, our major sources of working capital have been proceeds from product and license revenue, public and private offerings of our common stock, and proceeds from debt financings. We intend to satisfy our near-term liquidity requirements through a combination of our existing cash and cash equivalents and marketable securities as of MarchJune 31,30, 2026, and proceeds that we expect to become available to us through product sales, royaltiesroyalties, and sub-license milestone payments. However, this intention is based on assumptions that may prove to be wrong. Changes may occur that would consume our available capital faster than anticipated, including changes in and progress of our development activities, the impact of commercialization efforts, acquisition of additional drug candidates and changes in regulation. Some of these developments have had and may continue to have an adverse effect on our revenue and thus could have an adverse effect on our ability to satisfy the minimum revenue and cash balance covenants contained in the Athyrium Notes.revenue.

As of the date of the filing of this Quarterly Report, we believe there have been no material changes to our critical accounting policies and estimates during the threesix months ended MarchJune 31,30, 2026 from our accounting policies at December 31, 2025, as reported in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

Product revenue, net consists of revenue from sales of NERLYNX. We sell NERLYNX to a limited number of specialty pharmacies and specialty distributors in the United States. We record revenue at the net sales price, which includes an estimate for variable consideration for which reserves are established. Variable consideration consists of trade discounts and allowances, product returns, provider chargebacks and discounts, government rebatesrebates, and other incentives.

Selling, general and administrative expenses (“SG&A expenses”) consist primarily of salaries and payroll-related costs, stock-based compensation expense, professional fees, business insurance, rent, general legal activities, credit loss expenseexpense, and other corporate expenses. We expense SG&A expenses as they are incurred.

Research and development expenses (“R&D expenses”) include costs associated with services provided by consultants who conduct and perform clinical services on our behalf and contract organizations for the manufacturing of clinical materials. During the three and six months ended MarchJune 31,30, 2026 and 2025, our R&D expenses consisted primarily of clinical research organization (“CRO fees”); fees paid to consultants; salaries and related personnel costs; and stock-based compensation. We expense our R&D expenses as they are incurred. Internal R&D expenses primarily consist of payroll-related costs and also include equipment costs, travel expensesexpenses, and supplies.

On April 2, 2026, the U.S. government issued a proclamation under Section 232 of the Trade Expansion Act of 1962, imposing newa tariffs100% ad valorem duty, subject to specified exclusions, on importedthe import of patented pharmaceutical products andlisted in the FDA’s Orange Book or Purple Book, as well as their associated APIs. AnyA reduced 20% rate is available to companies with onshoring plans approved by the U.S. Secretary of Commerce, although this reduced rate is scheduled to increase to 100% over a four-year period. These tariffs become effective on July 31, 2026 for certain large companies and will become effective on September 29, 2026 for all other companies. The potential impact of the proclamation on the CompanyCompany, isincluding any indirect effect, remains uncertain and under review.

Three Months Ended MarchJune 31,30, 2026 Compared to Three Months Ended MarchJune 31,30, 2025

Total revenue for the three months ended MarchJune 31,30, 2026 was approximately $44.8$56.5 million, compared to $46.0$52.4 million for the three months ended MarchJune 31,30, 2025. This decreaseincrease in total revenue was due to aan decreaseincrease in product revenue, net of approximately $1.1$4.4 millionmillion, andpartially offset by a slight decrease in royalty revenue.

Product revenue, net was approximately $42.0$53.6 million for the three months ended MarchJune 31,30, 2026, compared to $43.1$49.2 million for the three months ended MarchJune 31,30, 2025. This decreaseincrease in product revenue, net, compared to the three months ended MarchJune 31,30, 2025, was primarily attributable to a 12.3% increase in domestic bottles sold and an increase in selling price, partially offset by a greater deduction to gross revenue for variable consideration, primarily related to governmenthigher chargebacksMedicaid andrelated payor mix, partially offset by an increase in selling price.deductions.

Royalty revenue was approximately $2.9 million and $3.2 million for each of the three months ended MarchJune 31,30, 2026 and 20252025. asThe decrease in royalty revenue was due to lower sales were relatively consistent toby our international partners.

Cost of sales was approximately $10.4$12.5 million for the three months ended MarchJune 31,30, 2026, compared to approximately $10.6$12.3 million for the three months ended MarchJune 31,30, 2025. Cost of sales was relativelyslightly consistenthigher year-over-year as sales of our product bottles were relatively consistent.higher.

SG&A expenses were approximately $18.4$17.5 million for the three months ended MarchJune 31,30, 2026, compared to approximately $17.6$18.0 million for the three months ended MarchJune 31,30, 2025. SG&A expenses for the three months ended MarchJune 31,30, 2026 and 2025 were as follows:

SG&A expenses increaseddecreased approximately $0.8$0.5 million for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, primarily attributable to the following:

R&D expenses were approximately $19.8$18.9 million for the three months ended MarchJune 31,30, 2026, compared to approximately $13.9$15.5 million for the three months ended MarchJune 31,30, 2025. R&D expenses for the three months ended MarchJune 31,30, 2026 and 2025 were as follows:

R&D expenses increased by approximately $5.9$3.4 million for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, primarily attributable to the following:

For the three months ended March 31,June 2026 ,30, 2026, we recognized approximately $0.7$0.2 million in interest expense, compared to approximately $2.2$1.8 million of interest expense for the three months ended March 31,June 2025 .30, 2025. The decrease in interest expense was primarily related to a lower debt balance as we continue payingpaid down our debt principal.principal in the three months ended June 30, 2026.

For the three months ended March 31,June 2026 ,30, 2026, we recognized approximately $0.1 $0.0 million in other income, compared to approximately $0.4 million of other income for the three months ended March 31,June 2025 .30, 2025. The decrease in other income was primarily due to the termination of subleases as of March 31, 2026 and unfavorable exchange rates in Euro-denominated transactions.

The following table, which summarizes our liquidity and capital resources as of MarchJune 31,30, 2026 and December 31, 2025 and for the threesix months ended MarchJune 31,30, 2026 and 2025, is intended to supplement the more detailed discussion that follows:

Cash provided by operating activities for the threesix months ended MarchJune 31,30, 2026 was $15.4$17.0 million and consisted of net lossincome of approximately $3.8$4.4 million, adjusted for non-cash items of approximately $4.5$8.9 million, which included stock-based compensation of $1.9$3.8 million and depreciation and amortization of $2.6$5.1 million. Total changes in cash flows from operations were due to an increase in working capital, primarily related to a decrease in accounts receivable of $27.3$19.6 million, primarily due to royalty receipts related to China salessales, andpartially offset by an increase in accounts payableinventory of $3.1$7.8 million,million partiallyrelated offsetto bythe purchase of raw material inventory, a decrease in accrued expenses and other of approximately $11.7$5.0 million related primarily to the payment of royalties,royalties anand increasea in$0.9 inventorymillion reversal of $3.2 million related to a receiptpreviously ofrecorded rawlegal material inventory,accrual, a decrease in operatingaccounts lease assets and liabilities, net,payable of $0.6$2.0 million and a decrease of post-marketing commitment liability of $0.5$1.0 million.

Cash provided by operating activities for the threesix months ended MarchJune 31,30, 2025 was $3.6$17.7 million and consisted of net income of approximately $3.0$8.8 million, adjusted for non-cash items of approximately $5.0$9.1 million, which included stock-based compensation of $2.0$3.7 million, depreciation and amortization of $2.8$5.6 million and provision for credit loss recovery of $0.2$0.1 million. Total changes in cash flows from operations were due to ana increaseslight decrease in working capital, primarily related to a decrease in accrued expenses and other of approximately $9.9$5.0 million, a decrease in operating lease assets and liabilities, net, of $0.4$0.9 million and a decrease of post-marketing commitment liability of $0.4 million and an increase in prepaid and other expenses of $0.8$1.1 million, partially offset by a decrease in prepaid and other expenses of $0.5 million, a decrease in accounts receivable of approximately $6.6$6.3 million and ana increasedecrease in accounts payableinventory of $0.5$0.1 million.

Cash provided by investing activities for the threesix months ended MarchJune 31,30, 2026 was approximately $2.5$10.4 million, compared to net cash providedused byin investing activities of approximately $1.5$9.7 million for the same period in 2025. Cash provided by investing activities for the threesix months ended MarchJune 31,30, 2026 was primarily due to the maturity of available-for-sale securities of approximately $27.3$56.9 million, partially offset by the purchase of available-for-sale securities of approximately $24.9$46.4 million.

Cash used in financing activities for the threesix months ended MarchJune 31,30, 2026 and 2025 was approximately $11.3$22.6 million, including $11.1$22.2 million related to the payment of principal and $0.2$0.4 million related to exit fees, on our debt with Athyrium. Our Athyrium Note was paid in full as of June 30, 2026.