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

We are highly dependent on the success of our product candidates which are in early clinical development. We have not completed successful late-stage pivotal clinical trials or obtained regulatory approval for any product candidate. We may never obtain approval for any of our product candidates or achieve or sustain profitability.

If we experience delays or difficulties in enrolling patients in our ongoing or planned clinical trials, our receipt of necessary regulatory approval could be delayed or prevented.

Our principal stockholders and management own a significant percentage of our stock and are able tocan exert significant control over matters subject to stockholder approval.

We are an “emerging growth company” and a “smaller reporting company” and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies or smaller reporting companies will make our common stock less attractive to investors.

Since our inception, we have focused substantially all of our efforts and financial resources on the research, preclinical and clinical development of our product candidates, and our research efforts on other potential product candidates targeting PRMT5, MCL1, CDK9, and BRM, otherwise known as SMARCA2.candidates. As of December 31, 2024,2025, our cash, cash equivalents, and marketable securities were $133.6$103.2 million.

Because of the numerous risks and uncertainties associated with pharmaceutical product development, we are unable to accurately predict the timing or amount of increased expenses we will incur or when, or if, we will be able to achieve profitability. If we decide to or are required by the FDA or regulatory authorities in other jurisdictions to perform studies or clinical trials in addition to those currently expected, or if there are any delays in establishing appropriate manufacturing arrangements for, in initiating or completing our current and planned clinical trials for, or in the development of, any of our product candidates, our expenses could increase materially and profitability could be further delayed.

We expect to continue to incur expenses in connection with our ongoing activities, particularly as we advance our product candidates through clinical development and seek to design additional product candidates from our discovery programs. We expect to incur continued expenses as we continue our research and development, initiate additional clinical trials, and seek marketing approval for our lead programs and our other product candidates. In addition, if we obtain marketing approval for any of our product candidates, we expect to incur significant commercialization expenses related to product manufacturing, marketing, sales and distribution. Furthermore, we expect to continue to incur additional costs associated with operating as a public company. Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations. Adequate additional financing may not be available to us on favorable terms, or at all. In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. For example, we received capital in connection with the exclusive option agreement entered into with Incyte Corporation (“Incyte”) in November 2025 in exchange for the option to acquire certain rights, titles and interests related to our mutative selective JAK2V617F inhibitor program. If we are unable to raise capital when needed or on favorable terms, we could be forced to delay, reduce or eliminate our research and development programs, our commercialization plans or other operations.

Our business, financial condition, results of operations and prospects could be adversely affected by general conditions in the global economy and in the global financial markets. A severe or prolonged economic downturn could result in a variety of risks to our business, including our ability to raise additional capital when needed on acceptable terms, if at all. A weak or declining economy could also strain our suppliers, service providers, manufacturers or other partners and there is a risk that one or more would not survive or be able to meet their commitments to us under such circumstances. Global credit and financial markets have experienced volatility and disruptions in the past several years partly due to widespread health concerns, pandemics and other outbreaks of illness as well as the ongoing conflicts in Ukraine and the Middle East.East and increasing tensions in Central and South America, including recent U.S. military operations in Venezuela. Such volatility includes severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, inflation, increases in unemployment rates and uncertainty about economic stability. There can be no assurances that further deterioration in credit and financial markets and confidence in economic conditions will not occur. For example, U.S. debt ceiling and budget deficit concerns have increased the possibility of additional credit-rating downgrades and economic slowdowns, or a recession in the United States. Although U.S. lawmakers passed legislation to raise the federal debt ceiling on multiple occasions, including a suspension of the federal debt ceiling in June 2023, ratings agencies have lowered or threatened to lower the long-term sovereign credit rating of the United States. The impact of this or any further downgrades to the U.S. government’s sovereign credit rating or its perceived creditworthiness could adversely affect the U.S. and global financial markets and economic conditions. Moreover, the uncertainty surrounding government funding debates and debt-ceiling negotiations can negatively affect market conditions, investor sentiment, and the liquidity of small-cap and microcap issuers such as ours. Accordingly, any future federal government shutdown or protracted budget impasse could materially and adversely affect our regulatory compliance, financing options and capabilities, and overall financial condition. Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current economic climate and financial market conditions could adversely impact our business.

We are highly dependent on the success of our product candidates whichthat are in early clinical development. We have not completed successful late-stage pivotal clinical trials or obtained regulatory approval for any product candidate. We may never obtain approval for any of our product candidates or achieve or sustain profitability.

Our future success is highly dependent on our ability to obtain regulatory approval for, and then successfully commercialize, our product candidates. We are early in our development efforts and our lead product candidates are each currently in early stage clinical development. Our other product candidates are in earlier stages of development.efforts. We currently have no products that are approved for sale in any jurisdiction. There can be no assurance that our product candidates in development will achieve success in their preclinical or clinical trials or obtain regulatory approval. Regulators may also request additional studies, data, and information, that we may need to develop and which were not originally planned. Any delays in clinical studies, obtaining regulatory approval, or if we never initiate clinical studies or obtain regulatory approval, could have a material adverse effect on our business, financial condition and results of operations.

Many of these factors are beyond our control, and it is possible that none of our product candidates will ever obtain regulatory approval even if we expend substantial time and resources seeking such approval. If we do not achieve one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to successfully commercialize our product candidates, which would materially harm our business. For example, our business could be harmed if results of our ongoing clinical trials vary adversely from our expectations.

We currently have several product candidates in Phase 1 clinical development and additional product candidates in preclinical development, and the risk of failure for each is high. We are unable to predict when or if our product candidates will prove effective or safe in humans or will obtain marketing approval. Before obtaining marketing approval from regulatory authorities for the sale of any product candidate, we must complete preclinical development and then conduct extensive clinical trials to demonstrate the safety and efficacy of our product candidates in humans. Clinical testing is expensive, difficult to design and implement, can take many years to complete and is uncertain as to the outcome.

A failure of one or more clinical trials can occur at any stage of testing. The outcome of preclinical testing and early clinical trials may not be predictive of the success of later clinical trials or of clinical trials of the same product candidates in other indications, and interim or preliminary results of a clinical trial do not necessarily predict final results. Later-stage clinical trials could differ in significant ways from early-stage clinical trials, including changes to inclusion and exclusion criteria, efficacy endpoints, dosing regimen and statistical design. In particular, the small number of patients in our current Phase 1and clinical trialsdesign. Studies may also be subject to confounding factors that make it difficult to interpret the results ofor thesethat trialscould lessimpact predictivethe reliability of the outcome of later clinical trials.results.

The FDA may require us to conduct additional preclinical studies or additional manufacturing development for any product candidate before it allows us to initiate subsequent clinical trials under any IND, which may lead to additional delays and increase the costs of our preclinical development programs.

Any delays in the commencement or completion of our ongoing, planned or future clinical trials could significantly affect our product development costs. We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to obtain marketing approval or commercialize our product candidates, including:

the FDA may disagree as to the design or implementation of our clinical trials or with our proposed dose for any of our pipeline programs. For instance, in the oncology space, FDA has recently focusedassesses not only on maximum tolerated dose but also on dose optimization, with the issuance of a guidance on this topic. FDA has also expressed a preference for randomized controlled clinical trials to support accelerated approval, rather than single arm trials with response endpoint;

the number of patients required for clinical trials for our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate or may be lower than we anticipate due to challenges in recruiting and enrolling suitable patients that meet the study criteria, participants may drop out of these clinical trials at a higher rate than we anticipate or may not follow trial procedures or the duration of these clinical trials may be longer than we anticipate;

the supply or quality of our product candidates or other materials necessary to conduct clinical trials for our product candidates may be insufficient or inadequate and result in delays or suspension of our clinical trials; and the impact of any widespread outbreak of a communicable disease, which may slow potential enrollment, reduce the number of eligible patients for clinical trials, confound trial results, or reduce the number of patients that remain in our trials.

If we experience delays or difficulties in enrolling patients in our ongoing or planned clinical trials, our receipt of necessary regulatory approval could be delayed or prevented.

We may not be able to initiate or continue our ongoing or planned clinical trials for our product candidates if we are unable to identify and enroll a sufficient number of eligible patients to participate in these trials as required by the FDA or comparable foreign regulatory authorities. In addition, some of our competitors currently have ongoing clinical trials for product candidates that would treat the same patients as our clinical product candidates, and patients who would otherwise be eligible for our clinical trials may instead enroll in clinical trials of our competitors’ product candidates. Patient enrollment is also affected by other factors, including:

Results of our ongoing and planned clinical trials could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics. Undesirable side effects caused by our product candidates could result in the delay, suspension or termination of clinical trials by us or regulatory authorities for a number of reasons or could result in a FDA determination not to approve the product. Furthermore, clinical trials by their nature utilize a sample of the potential patient population. With a limited number of subjects and limited duration of exposure, rare and severe side effects of our product candidates or those of our competitors may only be uncovered with a significantly larger number of patients exposed to the drug.

Additionally, due to the high mortality rates of the cancers for which we are initially pursuing development and the pretreated nature of many patients in our ongoing clinical trials,patients, a material percentage of patients in these clinical trials may die during a trial, which could impact the development of product candidates. If we elect or are required to delay, suspend or terminate any clinical trial, the commercial prospects of our product candidates will be harmed and our ability to generate product revenues from this product candidate will be delayed or eliminated. Adverse events observed in clinical trials could prevent approval of the product or, if approved, hinder or prevent market acceptance of our product candidates. Any of these occurrences may harm our business, prospects, financial condition and results of operations significantly.

From time to time, we may publicly disclose preliminary, interim or topline data from our clinical trials. These updates are based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to the particular study or trial. Additionally, interim data from clinical trials that we may complete 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. Therefore, positive interim results in any ongoing clinical trial may not be predictive of such results in the completed study or trial. We also make assumptions, estimations, calculations and conclusions as part of our analyses of data, and we may not have received or had the opportunity to fully and carefully evaluate all data. As a result, the topline results that we report may differ from future results of the same studies, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated. Topline data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary data we previously published. As a result, topline data should be viewed with caution until the final data are available. In addition, we may report interim analyses of only certain endpoints rather than all endpoints. Adverse changes between preliminary or interim data and final data could significantly harm our business and prospects. Further, additional disclosure of interim data by us or by our competitors in the future could result in volatility in the price of our common stock. See the description of risks under the heading “Risks Related to our Common Stock” for more disclosure related to the risk of volatility in our stock price.

Because we have limited financial and managerial resources, we focus on research programs and product candidates that we identify for specific indications. As a result, we may forego or delay pursuit of opportunities with other product candidates or for other indications that later prove to have greater commercial potential. Our resource allocation decisions may cause us to fail to capitalize on viable commercial products or profitable market opportunities. Our spending on current and future research and development programs and product candidates for specific indications may not yield any commercially viable products. As an example, on November 4, 2025, we announced that we were pausing the clinical development of our SMARCA2 degrader program, which is comprised of PRT3789 and PRT7732, for strategic reasons and not due to safety or regulatory concerns. If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate.

In addition, we may experience delays or rejections based upon additional government regulation from future legislation or administrative action, or changes in regulatory authority policy during the period of product development, clinical trials, and the review process. For example, the Oncology Center of Excellence, or OCE, within the FDA advanced Project Optimus, which is an initiative to reform the dose optimization and dose selection paradigm in oncology drug development to emphasize selection of an optimal dose, which is a dose or doses that maximizes not only the efficacy of a drug but the safety and tolerability as well. This shift from the prior approach, which generally determined the maximum tolerated dose, may require sponsors to spend additional time and resources to further explore a product candidate’s dose-response relationship to facilitate optimum dose selection in a target population. Other OCE initiatives have included Project FrontRunner, a newan initiative with a goal of developing a framework for encouraging sponsors to consider developing cancer drugs in the earlier advanced setting rather than for treatment of patients who have received numerous prior lines of therapies or have exhausted available treatment options. We are considering these and any other policy changes, including initiatives with respect to accelerated approval and to coordinate review of oncology products among international regulators, as they relate to our programs.

Future changesChanges in legal and regulatory requirements may introduce new risks into our operations and future prospects, which we are not able to currently anticipate. By example, changes taking place in the United States associated with athe newcurrent federal administration, as well as changes in legal standards, including the reduced level of judicial deference due to administrative agencies following a 2024 Supreme Court decision, may introduce uncertainties with respect to our current and future operations and our future likelihood of success. It is possible that newNew federal or state laws or regulations may be passed or have been passed, or laws and regulations may be and have been enforced differently than they were before, which may expose us to additional legal and regulatory risk or uncertainty and require the expenditure of additional resources to ensure that we are able to comply. Such actions could also adversely restrict our business and operations. There could also be changes in FDA’s approval standards that could impact our ability to obtain product approval and market our product candidates within the currently anticipated timeframes or otherwise impact the competitive market for our product candidates. Such changes may necessitate the conduct of additional development work, including preclinical and clinical trials, and manufacturing development. By example, for products intended for rare and serious diseases with unmet medical needs, FDA is authorized to exercise regulatory flexibility when making a medical risk-benefit judgment. It is possible that whether and how FDA exercises any regulatory flexibility, including with respect to specialized pathways, such as accelerated approval, and with respect to our product candidates may change, which could impact our ability to obtain product approval. Further, legal and regulatory changes may impact how we may market and sell our products in the future, if they are approved, as well as how they are reimbursed. Moreover, there have and could be further changes in the federal workforce and agency policies that may result in regulatory delays, including with respect to FDA’s review of marketing applications and other submissions, and that may impact the ability to communicate with and obtain guidance from the agencies. At this time, it is too early to predict the exact nature of any changes that may take place or whether and how they may impact our business and results of operation.

In order to market and sell our products in any jurisdiction outside the United States, we must obtain separate marketing approvals and comply with numerous and varying regulatory requirements. The approval procedure varies among countries and can involve additional testing. The time required to obtain approval may differ substantially from that required to obtain FDA approval. The regulatory approval process outside the United States generally includes all of the risks associated with obtaining FDA approval. In addition, in many countries outside the United States, it is required that the product beobtain approvedpricing forand reimbursement before the product can be approved for sale in that country.approval. We may not obtain approvals from regulatory authorities outside the United States on a timely basis, if at all. Approval by the FDA does not ensure approval by regulatory authorities in other countries or jurisdictions, and approval by one regulatory authority outside the United States does not ensure approval by regulatory authorities in other countries or jurisdictions or by the FDA. We may not be able to submit for marketing approvals and may not receive necessary approvals to commercialize our products in any market.

Regulatory authorities in some jurisdictions, including the United States, may designate drugs for relatively small patient populations as “orphan drugs.” Under the Orphan Drug Act, the FDA may designate a drug as an orphan drug if it is intended to treat a rare disease or condition, which is generally defined as a patient population of fewer than 200,000 individuals in the United States, or if the disease or condition affects more than 200,000 individuals in the United States and there is no reasonable expectation that the cost of developing the drug for the type of disease or condition will be recovered from sales of the product in the United States. When seeking orphan drug designation, sponsors must also provide medically plausible basis for the use of the drug for the rare disease or condition.

Orphan drug designation can provide opportunities for financial incentives, such as opportunities for grant funding towards clinical trial costs, tax advantages and user-fee waivers. Additionally, if a product 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 to market the same drug for the same approved indication for seven years, except in certain circumstances, such as a showing of clinical superiority (i.e., another product is safer, more effective or makes a major contribution to patient care) over the product with orphan exclusivity or where the manufacturer is unable to assure sufficient product quantity. Competitors, however, may receive approval of different products for the same indication for which the orphan product has exclusivity, or obtain approval for the same product but for a different indication than that for which the orphan product has exclusivity.

A companion diagnostic is generally developed in conjunction with the clinical program for an associated therapeutic product. To date, the FDA has required premarket approval of the vast majority of companion diagnostics for cancer therapies, except in limited cases where FDA allows the usediagnostic ofis considered an LDT as a companion diagnostic (as discussed above,LDT. LDTs are generally not subject to FDA enforcement discretion and do not require FDA premarket approval,jurisdiction, but remain subject to CLIA regulatory requirements).requirements. Generally, when a companion diagnostic is essential to the safe and effective use of a drug product, the FDA requires that the companion diagnostic be approved before or concurrent with approval of the therapeutic product and before a product can be commercialized. The approval of a companion diagnostic as part of the therapeutic product’s labeling limits the use of the therapeutic product to only those patients who express the specific genetic alteration that the companion diagnostic was developed to detect.

We must also comply with requirements concerning advertising and promotion for any of our product candidates for which we obtain marketing approval. Promotional communications with respect to prescription drugs are subject to a variety of legal and regulatory restrictions and must be consistent with the information in the product’s approved labeling, among other requirements. Thus, we will not be able to promote any products we develop for indications or uses for which they are not approved. Over the last year, FDA has increased its enforcement of promotional and advertising requirements, especially in the area of direct to consumer advertising. Accordingly, there may be an increased risk of enforcement should promotional communications not comply with FDA’s requirements.

HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, or HITECH, and their implementing regulations, impose requirements on certain covered entities, including healthcare providers, health plans, and healthcare clearinghouses as well as their respective business associates and their subcontractors that perform services for them that involve the use, or disclosure, of individually identifiable health information, relating to the privacy, security, and transmission of such individually identifiable health information;

The ACA requires certain manufacturers of drugs, devices, biologics and medical supplies to annually report to CMS information related to certain payments and other transfers of value provided to teaching hospitals and to U.S.-licensed physicians, (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), physician assistants, nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists and anesthesiologist assistants, and certified nurse-midwives. Applicable manufacturers also must report ownership and investment interests held by physicians and their immediate family members; and analogous state laws and regulations, such as state anti-kickback and false claims laws, and analogous non-U.S. fraud and abuse laws and regulations may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers. Some state laws require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines or the Compliance Program Guidance for Pharmaceutical Manufacturers published by the U.S. Department of Health & Human Services, Office of Inspector General; to implement gift bans, and to report information related to payments and other transfers of value to physicians and other healthcare providers, marketing expenditures, or drug pricing, including price increases. Some state and local laws require the registration of pharmaceutical sales representatives. Various state and non-U.S. laws also govern the privacy and security of individuals' health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.

Other legal, regulatory and commercial policy influences are subjecting our industry to significant changes, and we cannot predict whether new regulations or policies will emerge from U.S. federal or state governments, foreign governments, or third-party payors. Government and commercial payors may, in the future, consider healthcare policies and proposals intended to curb rising healthcare costs, including those that could significantly affect reimbursement for healthcare products such as our systems. These policies have included and may in the future include: basing reimbursement policies and rates on clinical outcomes, the comparative effectiveness, and costs, of different treatment technologies and modalities; imposing price controls and taxes on medical device providers; and other measures. These policies culminated in the enactment of the Inflation Reduction Act, or IRA, in August 2022, which, among other things, allows the U.S. Department of Health and Human Services, or HHS, to negotiate the selling price of certain drugs and biologics that CMS reimburses under Medicare Part B and Part D. The IRA requires manufacturers of selected drugs to negotiate discounted prices with the Secretary of HHS. Failure of a manufacturer to reach an agreement can subject manufacturers to an excise tax or withdraw of all drug products from coverage under Medicare and Medicaid. The negotiated prices, which will first become effective in 2026 and were capped at a statutory ceiling price beginning in October 2023, penalize drug manufacturers that increase prices of Medicare Part B and Part D drugs at a rate greater than the rate of inflation. The IRA permits the Secretary of HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years. Manufacturers that fail to comply with the IRA may be subject to various penalties, including civil monetary penalties. The IRA also extends enhanced subsidies for individuals purchasing health insurance coverage in ACA marketplaces through plan year 2025. These provisions began taking effect in 2023 and2023, have since been subject to multiple legal challenges.challenges, and have since been allowed by Congress to expire. Future significant changes in the healthcare systems in the United States or elsewhere could also have a negative impact on the demand for our current and future products. These include changes that may reduce reimbursement rates for our products and changes that may be proposed or implemented by the current or future laws or regulations. It is unclear exactly howwhat, theif 2024 presidential election will impactany, healthcare reform measures of the existing administration or whether a new administration could impose other reform efforts, including what, if any, impact such changes will have on our business. For example, drug price negotiations and other IRA program implementation measures could potentially be affected by the Executive Order, Initial Rescissions of Harmful Executive Orders and Actions, issued by President Trump on January 20, 2025 and/or the anticipated changes in leadership at HHSHealth and Human Services (HHS) and the Centers for Medicare and Medicaid Services (CMS) under the new administration. In another example, the CMS issued an interim final rule on November 27, 2020, implementing a Most Favored Nation, or MFN, payment model under which reimbursement for certain Medicare Part B drugs and biologicals would be based on a price that reflects the lowest per capital Gross Domestic Product-adjusted, or GDP-adjusted, price of any non-U.S. member country of the Organization for Economic Co-operation and Development, or OECD, with a GDP per capita that is at least sixty percent of the U.S. GDP per capita. Although this rule has since been rescinded, in November 2025, CMS introduced the GENEROUS Model, which is scheduled to launch in January 2026 and run for five years, pursuant to which manufacturers will provide supplemental rebates aligned with MFN pricing to participating in state Medicaid programs that opt into the program in exchange for standardized coverage criteria across all participating states.

In some countries, particularly the countries of the European Union, or the EU, the pricing of prescription pharmaceuticals is subject to governmental control. In these countries, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a product. To obtain reimbursement or pricing and reimbursement approval in some countries, we may be required to conduct a clinical trial that compares the cost-effectiveness of our product candidates to other available therapies. Some jurisdictions operate positive and negative list systems under which products may only be marketed once a reimbursement price has been agreed. Other countries allow companies to determine the prices for their medicines but monitor and control company profits and may limit or restrict reimbursement and can include retrospective rebates to the government. If reimbursement of our products is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, our business could be harmed. Political, economic and regulatory developments may further complicate pricing negotiations, and pricing negotiations may continue after reimbursement has been obtained.obtained, or vice versa. Reference pricing used by various EU member states and parallel trade, such as arbitrage between low-priced and high-priced member states, can further reduce prices. There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements for any products.

Various international trade, export control and sanctions laws, regulations and executive orders also restrict the use and dissemination outside of the United States, or the sharing with certain non-U.S. persons in the United States, of personalproducts identifying information and products,or technology orthat sensitive personal dataare controlled for export, as well as restricting our ability to deal with certain persons subject to sanctions. Specifically, certain biological agents, toxins, and related technology are restricted by the United States for export to certain countries for national security reasons and require an export authorization from the U.S. Department of Commerce. U.S. export controls also apply to genetic elements and genetically modified organisms that contain DNA associated with the pathogenicity of these biological materials. There are also a number of foreign parties on the U.S. Specially Designated Nationals and Blocked Parties List and the Entity List, both of which prohibit certain transactions by U.S. persons or from the U.S. with designated persons. If we expand our presence outside of the United States, it will require us to dedicate additional resources to comply with these laws, and these laws may preclude us from developing, manufacturing or selling certain product candidates and products outside of the United States, which could limit our growth potential and increase our development costs.

We do not have the ability to independently conduct all aspects of our preclinical testing or clinical trials ourselves. As a result, we are dependent on third parties to conduct our ongoing and planned clinical trials of our product candidates and any preclinical studies and clinical trials of any other product candidates. The timing of the initiation and completion of these trials will therefore be partially controlled by such third parties and may result in delays to our development programs. Specifically, we expect CROs, clinical investigators, laboratories and consultants to play a significant role in the conduct of these trials and the subsequent collection and analysis of data. However, these CROs and other third parties are not our employees, and we will not be able to control all aspects of their activities. Nevertheless, we are responsible for ensuring that each clinical trial is conducted in accordance with the applicable protocol and legal, regulatory and scientific standards, and our reliance on the CROs and other third parties does not relieve us of our regulatory responsibilities. By example, we are required to monitor the activities of third parties undertaking clinical trials on our behalf, but our monitoring may not be able to detect any existing or emerging issues.

We and our CROs, as well as other third parties, including investigators, are required to comply with good clinical practices, or GCP, requirements, which are regulations and guidelines enforced by the FDA for product candidates in clinical development. Regulatory authorities enforce these GCP requirements through periodic inspections of trial sponsors, clinical trial investigators and clinical trial sites. If we or any of our CROs or clinical trial sites fail to comply with applicable GCP requirements or to conduct a trial in accordance with its investigational plan, we or they may be subject to enforcement actions, the data generated in our clinical trials may be deemed unreliable, and the FDA may require us to perform additional clinical trials before approving our marketing applications. We cannot assure you that, upon inspection, the FDA will determine that our clinical trials comply with GCPs. In addition, our clinical trials must be conducted with product produced under cGMP regulations applicable to the stage of product development and our preclinical trials must be conducted in accordance with good laboratory practices. Our failure or the failure of third parties on whom we rely on to comply with these regulations may require us to stop and/or repeat clinical trials or other studies, which would delay the marketing approval process.

Any performance failure on the part of our existing or future manufacturers could delay clinical development or marketing approval. We do not currently have arrangements in place for redundant supply or a second source for bulk drug substance. If our current CMOs for preclinical and clinical testing cannot perform as agreed, we may be required to replace such CMOs. Additionally, if legal and regulatory requirements change, we may need to seek CMOs outside of certain territories or domestically. Although we believe that there are several potential alternative manufacturers who could manufacture our product candidates, we may incur added costs and delays in identifying and qualifying any such replacement manufacturer or be able to reach agreement with any alternative manufacturer. Further, our third-party manufacturers may experience manufacturing or shipping difficulties due to resource constraints or as a result of natural disasters, labor disputes, unstable political environments, including the ongoing conflicts in Ukraine and the Middle East,East and increasing tensions in Central and South America, including recent U.S. military operations in Venezuela, or public health epidemics such as the COVID-19 pandemic.epidemics. If our current third-party manufacturers cannot perform as agreed, we may be required to replace such manufacturers and we may be unable to replace them on a timely basis or at all.

There have been Congressional legislative proposals, such as the recent bill titled the Biosecure Act,proposals to discourage contracting with Chinese companies on the development or manufacturing of pharmaceutical products. For example, the BIOSECURE Act was passed as part of the National Defense Authorization Act for Fiscal Year 2026 and prohibits U.S. government contracts, loans and grants being made to any “biotechnology company of concern” or to any entity that uses biotechnology equipment or services from a “biotechnology company of concern”, including certain entities in China involved in the manufacturing, distribution, provision, or procurement of a biotechnology equipment or service. If our suppliers or our customers were to be designated under the Act, this could potentially harm our business and could severely restrict our ability to purchase services or products from, or otherwise collaborate with “biotechnology companies of concern” without losing the ability to contract with, or otherwise receive funding from, the U.S. government. If any new legislation, executive orders, tariffs, laws and/or regulations are implemented, if existing trade agreements are renegotiated or if the U.S. or Chinese governments take retaliatory actions due to the recent U.S.-China tension, such changes could have an adverse effect on our business, financial condition and results of operations, our ability to raise capital and the market price of our shares.

limitations or warningswarnings, as well as approved indication, contained in the labeling approved for our product candidates by the FDA;

The development and commercialization of pharmaceutical products is highly competitive. We face competition with respect to our current product candidates and will face competition with respect to any product candidates that we may seek to develop or commercialize in the future, from major pharmaceutical companies, specialty pharmaceutical companies and existing or emerging biotechnology companies, academic research institutions and governmental agencies and public and private research institutions worldwide. There are a number of pharmaceutical and biotechnology companies that currently are pursuing the development of precision oncology therapies optimized to effectively target the key driver mechanisms in cancers with high unmet need, including Amgen Inc., Arvinas Inc., AstraZeneca plc, Aurigene, Boehringer Ingelheim, C4 Therapeutics, Eli Lilly and Company, F. Hoffman-La Roche, Foghorn Therapeutics Inc., Gan & Lee, Genentech, Gilead Sciences, Inc., GlaxoSmithKline plc, Johnson & Johnson, Kronos Bio, Inc., Kymera Therapeutics Inc., Nanjing Zaiming Pharmaceutical Co. Ltd., Nurix Therapeutics, Oncopia Therapeutics, Pfizer Inc., Plexium, Sellas Life Science Group, Inc., Suzhou Zanrong Pharmaceutical Technology Co. Ltd, Vincerx Pharma, Inc., Novartis AG, and Shanghai Haiyan Pharmaceutical Technology Co Ltd.need.

For our SMARCAJAK2V617F 2 (BRM) degraderinhibitor program, othercompetition companies,includes includingIncyte Amgen,Corporation, Aurigene,Cogent C4Biosciences, Eilean Therapeutics, Foghorn Therapeutics, Inc., Kymera Therapeutics, Arvinas, Genentech, Boehringer Ingelheim, and LillyAtavistik Bio, all of which have publicly disclosed their pre-clinical research and development efforts.

Many of the companies against which we are competing or against which we may compete in the future, either alone or through collaborations, have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved products than we do. Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller and other early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These third parties compete with us in recruiting and retaining qualified scientific, management and sales and marketing personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs. Moreover, we face increased competition from other companies that are using artificial intelligence, some of whom may be able to more quickly and effectively identify and develop novel product candidates compared to us and our business partners, which could impair our ability to compete effectively and have a material adverse effect on our business, results of operations or financial condition.

As of December 31, 2024,2025, we had 13179 full-time employees. We expectmay experience significant growth in the number of our employees and the scope of our operations, particularly in the areas of clinical development, clinical operations, manufacturing, regulatory affairs and, if any of our product candidates receives marketing approval, sales, marketing and distribution. To manage our anticipated future growth, we must continue to implement and improve our managerial, operational and financial systems, expand our facilities and continue to recruit and train additional qualified personnel. Due to our limited financial resources and the limited experience of our management team in managing a company with such anticipated growth and with developing sales, marketing and distribution infrastructure, we may not be able to effectively manage the expansion of our operations or recruit and train additional qualified personnel. The expansion of our operations may lead to significant costs and may divert our management and business development resources.

Our systems, and those of Third Parties, may also experience security breaches from inadvertent or intentional actions by our employees, or from cyber-attacks by malicious third parties including the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering and other means to affect service reliability and threaten the confidentiality, integrity and availability of information. The risk of a security breach or disruption, particularly through cyber-attacks or cyber intrusion, including by insiders, hacktivists, computer hackers, state sponsored actors, foreign governments, cyber terrorists and cyberother terrorists,threat actors, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. We may not be able to anticipate all types of security and operational threats, nor may we be able to implement preventive measures effective against all such security threats. The techniques used by cyberthreat criminalsactors change frequently, may not be recognized until launched and can originate from a wide variety of sources, including insiders, outside groups such as hacktivists, external service providers, organized crime affiliates, state sponsored actors, terrorist organizations ororganizations, hostile foreign governments or agencies.agencies, or other threat actors. If a disruption or security breach were to result in a loss of, or damage to, our data or applications, or those of our Third Parties, or inappropriate disclosure and other compromise of confidential information,information or impacts to the integrity and availability of data or systems, we could incur liability and reputational damage and the further development and commercialization of our product candidates could be delayed. Any breach, loss or compromise of clinical trial participant personal data may also subject us to civil damages and penalties, under the GDPR (as defined below), HIPAA and other relevant international, state and federal privacy laws.laws, data protection, operational resilience, and cybersecurity. The costs related to significant security breachesbreaches, resilience events or disruptions could be material and exceed the limits of the cybersecurity insurance we maintain against such risks. If the information technology systems of our Third Parties become subject to disruptionsdisruptions, resilience events or security breaches, we may have insufficient recourse against such third parties and we may have to expend significant resources to mitigate the impact of such an event, and to develop and implement protections to prevent future events of this nature from occurring. Any such incident that leads to loss of integrity or availability, unauthorized access, use, or disclosure of personal information, including personal information regarding our clinical trial subjects or employees, could require public notification and/or notification to governmental entitiesentities, business partners, suppliers, customers, and individuals, harm our reputation directly, subject us to mandatory corrective action, and otherwise subject us to liability under laws and regulations that protect the privacy and security of personal information,information or data protection, operational resilience, and cybersecurity, which could result in significant legal and financial exposure and reputational damages that could potentially have an adverse effect on our business.

We and any potential collaborators may be subject to federal, state and foreign data protection laws and regulations (i.e., laws and regulations that address data protection, privacy and data security). In the United States, numerous federal and state laws and regulations, including federal health information privacy laws, state data breach notification laws, state health information privacy laws, state consumer privacy laws, and federal and state consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), that govern the collection, use, disclosure and protection of health-related and other personal information could apply to our operations or the operations of our collaborators. In addition, we may obtain health information from third parties (including research institutions from which we obtain clinical trial data) that areis subject to privacy, data protection and security requirements under HIPAA, as amended by HITECH. Depending on the facts and circumstances, we could be subject to criminal penalties if we knowingly obtain, use, or disclose individually identifiable health information maintained by a HIPAA-coveredHIPAA-regulated entity in a manner that is not authorized or permitted by HIPAA.

In addition, data protection requirements and risk are increasing in the United States. The state of California enacted the California Consumer Privacy Act, or CCPA, which creates new individual privacy rights for California consumers (as defined in the CCPA), including the rights to access, correction,correct, and deletiondelete andpersonal placesinformation increased privacy and security obligations on entities handling certain personal data of consumers or households. The CCPA requires covered companies to provide detailed disclosures to consumers about such companies’ data collection, use and sharing practices, provide such consumers new ways to opt-out of certain sales or transfers of personal information, and provide consumers with additional causes of action. Following California’s lead, other states have adopted similar comprehensive consumer privacy laws, all of which may impact our business activities and exemplifies the vulnerability of our business to the evolving regulatory environment related to personal data and protected health information. The CCPA and other state privacy laws provide for significant civil penalties for violations, and California now provides for a private right of action for data breaches that is expected to increase data breach litigation. These regulatory changes may increase our compliance costs and potential liability, particularly in the event of a data breach.breaches.

Our company is located in Delaware. Any unplanned event, such as flood, fire, explosion, earthquake, extreme weather condition, medical epidemic, power shortage, telecommunication failure or other natural or manmade accidents or incidents that result in us being unable to fully utilize our facilities, or the manufacturing facilities of our third-party CMOs, may have a material and adverse effect on our ability to operate our business, particularly on a daily basis, and have significant negative consequences on our financial and operating conditions. For example, our operations are concentrated primarily on the east coast of the United States, and any adverse weather event or natural disaster, such as a hurricane or heavy snowstorm, could have a material adverse effect on a substantial portion of our operations. Extreme weather conditions or other natural disasters could further disrupt our operations and have a material and adverse effect on our business, financial condition, results of operations and prospects. In addition, the long-term effects of climate change on general economic conditions and the pharmaceutical industry in particular are unclear and may heighten or intensify existing risk of natural disasters. If a natural disaster, power outage or other event occurred that prevented us from using all or a significant portion of our headquarters, that damaged critical infrastructure, such as our research facilities or the manufacturing facilities of our third-party CMOs, or that otherwise disrupted operations, it may be difficult or, in certain cases, impossible, for us to continue our business for a substantial period of time. The disaster recovery and business continuity plans that we have in place may prove inadequate in the event of a serious disaster or similar event. We may incur substantial expenses as a result of the limited nature of our disaster recovery and business continuity plans, which could have a material adverse effect on our business. As part of our risk management policy, we maintain insurance coverage at levels that we believe are appropriate for our business. However, in the event of an accident or incident at these facilities, we cannot assure you that the amounts of insurance will be sufficient to satisfy any damages and losses. If our facilities, or the manufacturing facilities of our third-party CMOs, are unable to operate because of an accident or incident or for any other reason, even for a short period of time, any or all of our research and development programs may be harmed. Any business interruption could have a material and adverse effect on our business, financial condition, results of operations and prospects.

Prelude is a clinical-stage fully integratedprecision oncology company built on a foundation of drug discovery excellence to deliver novel precision cancer medicines to underserved patients. By leveraging our core competencies in cancer biology and medicinal chemistry, combined with our clinical development capabilities, we have built an efficient, drug discovery engine and the development expertise necessary to identify compelling biological targets and create new chemical entities, or NCEs, that we advance into clinical trials. We believe our approach could result in better targeted cancer therapies. Our discovery excellence has been supported by our steady progress in creatingadvancing a wholly-owned,pipeline internallyof developednovel pipeline.precision oncology development candidates, alone and with partners. We alsoare began workworking with our partner AbCellera Biologics, Inc. ("AbCellera") on an early-stage discovery program involving potent degraders as payloads for novel antibodies targeting tumor specific antigens. Since our inception in 2016, we have received clearance from the U.S. Food and Drug Administration, or the FDA, for multiple investigational new drug applications, or INDs, and successfully advanced several programs into clinical trials. In addition, we have other differentiated proprietary programs in various stages of preclinical development.

By focusing on developing molecules using broad mechanisms that have multiple links to oncogenic driver pathways in select patients, we have developed a diverse pipeline consisting of multiple distinct programs including kinases, targeted protein degraders, and precisiondegrader antibody drugconjugates conjugates.("DAC"). Our pipeline is designed to serve patients with high unmet medical need, where there are limited or no treatment options. We believe we can best address these diseases by developingharnessing therapiesadvances thatin targetnew primarytherapeutic modalities such as targeted protein degradation to develop highly potent and secondaryspecific resistanceagents mechanisms.against clinically validated targets in areas of high unmet need.

OutsideDrawing ofon theour AbCelleraexpertise collaboration,in thetargeted Companyprotein hasdegradation, we have discovered and optimized a numberseries of pre-clinicalproprietary precisiondegrader payloads.payloads for use in discovering and developing DACs. We disclosed first data at the 36th EORTC-NCI-AACR Symposium describing preclinical proof-of-concept using a novel, potent SMARCA2/4 dual degrader as a “Precisiondegrader Payload”payload conjugated to multiple antibodies. Prelude’s SMARCA2/4 dual degraders have shown picomolar potency with potential for increased efficacy, selectivity and improved therapeutic index. Precision ADCsDACs have potential to expand the reach of SMARCA degrader technology to cancers without SMARCA4 mutations.

As of December 31, 2024,2025, we had $133.6$106.4 million in cash, cash equivalents, restricted cash and marketable securities. We expect our existing cash, cash equivalentsequivalents, restricted cash and marketable securities will enable us to fund our operating expense and capital expenditures into the second quarter of 2026.2027.

In May 2024, the Company and Pathos AI, Inc. ("Pathos") entered into a license agreement under which the Companywe granted to Pathos an exclusive, sublicensable, world-wide license to its selective, brain-penetrant PRMT5 inhibitor, PRT811. Under the terms of the license agreement, the Companywe received a $3.0 million upfront, non-refundable payment. The agreement also included a near term $4.0 million payment upon the earlier of 180 days following the effective date of the license agreement or the execution of a quality agreement between the parties pursuant to which thewe Company will transfertransferred title to certain quantities of Active Pharmaceutical Ingredient (“API”). In addition, the Companywe may receive potential developmental milestone payments up to $37.0 million, potential sales milestone payments up to $100 million and a range of high single-digit to low double-digit royalties on PRT811 global net sales.

The CompanyWe assessed the license agreement with Pathos in accordance with ASC Topic 606, Revenue from Contracts with Customers, and concluded that Pathos is a customer. The CompanyWe evaluated all of the promised goods or services within the contract and determined which goods and services were separate performance obligations. The CompanyWe determined that the exclusive license and transfer of related know-how and materials representsrepresent one combined performance obligation. The execution of a quality agreement pursuant to which thewe Company will transfertransferred title to certain API was identified as a separate performance obligation. Both performance obligations were satisfied in 2024.

costs of funding research performed by third parties, including pursuant to agreements with clinical research organizations,organizations or CROs,("CROs"), that conduct our clinical trials, as well as investigative sites, consultants and CROs that conduct our preclinical and nonclinical studies;

expenses incurred under agreements with contract manufacturing organizations,organizations or CMOs,("CMOs") including manufacturing scale-up expenses and the cost of acquiring and manufacturing preclinical study and clinical trial materials;

We track outsourced development costs and other external research and development costs to specific product candidates on a program-by-program basis, fees paid to CROs, CMOs and research laboratories in connection with our preclinical development, process development, manufacturing and clinical development activities. However, we do not track our internal research and development expenses on a program-by-program basis as they primarily relate to compensation, early research and other costs,costs which are deployed across multiple projects under development.

Research and development activities are central to our business model. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. We expect to continue to incur research and development expenses over the next several years related to personnel costs, including stock-based compensation, our clinical trials, including later-stage clinical trials, for current and future product candidates and preparing regulatory filings for our product candidates.

We expect to continue to incur general and administrative expense in the future to support our continued research and development activities and potential commercialization efforts. These expenses will likely include costs related to personnel and fees to outside consultants and legal support, among other expenses. The costs associated with being a public company include expenses related to services associated with maintaining compliance with the requirements of Nasdaq and the Securities and Exchange Commission,Commission or SEC,("SEC") insurance and investor relations costs. If any of our current or future product candidates obtains U.S. regulatory approval, we expect that we would incur significantly increased expenses associated with building a sales and marketing team.

Other income, net consists primarily of interest earned on our cash equivalents and marketable securities, research and development tax credits, and grant income received from the State of Delaware. We anticipate re-applying for the grant from the State of Delaware from time to time as long as we maintain qualifying headcount levels in the State of Delaware.

Since our inception, we have not recorded any income tax benefits for the net operating losses,losses or NOLs,("NOLs") we have incurred or for our research and development tax credits, as we believe, based upon the weight of available evidence, that it is more likely than not that all of our NOLs and tax credits will not be realized.

Research and development expenses increaseddecreased by $14.6$23.7 million to $94.3 million for the year ended December 31, 2025 from $118.0 million for the year ended December 31, 2024 from $103.4 million for the year ended December 31, 2023.2024. Included in research and development expenses for the year ended December 31, 2024,2025, was $12.1$6.9 million of non-cash expense related to stock-based compensation expense, including employee stock options, compared to $12.6$12.1 million for the year ended December 31, 2023.2024. ResearchAlong with the decrease in stock-based compensation expense, research and development expenses increaseddecreased due to a higher number of patients enrolleddecrease in clinical trials during 2024 driving an increase inexpense related costs,to suchour asdiscontinued chemistry,clinical manufacturingtrials, primarily PRT3789 and controls (“CMC”) expense, to support the trials.PRT2527. Research and development expenses may fluctuate from period to period depending upon the stage of certain projects and the level of preclinical and clinical trial-related activities.

Research and development expenses by program are summarized in the table below. ExpensesIncluded forin Other are programs thatsuch haveas beenPRT2527, discontinuedPRT1419, areand included in Other.PRT3645.

General and administrative expenses decreased by $0.2$6.3 million to $22.4 million for the year ended December 31, 2025 from $28.7 million for the year ended December 31, 2024 from $28.9 million for the year ended December 31, 2023.2024. Included in the general and administrative expenses for the year ended December 31, 20242025 was $9.2$5.0 million of non-cash expense related to stock-based compensation expense, including employee stock options, as compared to $13.0$9.2 million for the same period in 2023.2024. The decrease in general and administrative expense was primarily due to a decrease in stock-based compensation,compensation offsetalong bywith ana increasedecrease in professionalemployee feesrelated incurred to support our research and development efforts.expenses.

Other income, net increaseddecreased by $2.1$7.5 million to $5.1 million for the year ended December 31, 2025 from $12.5 million for the year ended December 31, 2024 from $10.4 million for the year ended December 31, 2023,2024, primarily due to thelower receiptincome earned on our investments due to lower balances and recognition oflower research and development tax credits from the State of Delaware of $2.4 millionreceived in 2024 compared to $1.3 million in 2023.2025.

Since our inception, we have not recognized any product revenue and have incurred operating losses and negative cash flows from our operations. We have not yet commercialized any product and we do not expect to generate revenue from sales of any products for several years, if at all. Since our inception, we have funded our operations through the sale of convertible preferred stockstock, common stock, and commonpre-funded stock.warrants. As of December 31, 2024,2025, we had $133.6$106.4 million in cash, cash equivalents, restricted cash and marketable securities and had an accumulated deficit of $583.6$683.1 million. We expect our existing cash, cash equivalents, and marketable securities will enable us to fund our operating expense and capital expenditures into the second quarter of 2026.2027.

During the year ended December 31, 2024,2025, we used $102.9$56.3 million of cash in operating activities. Cash used in operating activities reflected our net loss of $127.2$99.5 millionmillion, partially offset by noncash charges of $20.1$14.8 million, which consisted primarily of $21.3$11.9 million in stock-based compensation, along with a $4.2$28.4 million net decreaseincrease in our operating assets and liabilities.liabilities, which related primarily to an increase in deferred revenue. The primary use of cash was to fund our operations related to the development of our product candidates.

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this Quarterly Report on Form 10-Q. In addition to historical financial information, this discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties, such as statements of our plans, objectives, expectations, intentions and belief.beliefs. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in the section titled “Risk Factors” under Part I, Item 1A of our Annual Report on Form 10-K filed with the SEC on March 10, 2026, or our 2025 Annual Report on Form 10-K. These forward-looking statements may include, but are not limited to, statements regarding our future results of operations and financial position, our ability to develop our clinical candidates, inflation and interest rate risk, recessionary concerns, the effect of continued federal government shutdown, business strategy, market size, potential growth opportunities, preclinical and clinical development activities, efficacy and safety profile of our product candidates, use of net proceeds from our offerings, our ability to maintain and recognize the benefits of certain designations received by product candidates, the timing and results of preclinical studies and clinical trials, commercial collaborations with third parties and the receipt and timing of potential regulatory designations, approvals and commercialization of product candidates. The words “believes,” “anticipates,” “estimates,” “plans,” “expects,” “intends,” “may,” “could,” “should,” “potential,” “likely,” “projects,” “continue,” “will,” “schedule,” and “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

Prelude is a precision oncology company built on a foundation of drug discovery excellence to deliver novel precision cancer medicines to underserved patients. By leveraging our core competencies in cancer biology and medicinal chemistry, combined with our clinical development capabilities, we have built an efficient,efficient drug discovery engine and the development expertise necessary to identify compelling biological targets and create new chemical entities,entities or NCEs,("NCEs") that we advance into clinical trials. We believe our approach could result in better targeted cancer therapies. Our discovery excellence has been supported by our steady progress in advancing a pipeline of novel precision oncology development candidates, alone and with partners. We are working with our partner AbCellera Biologics, Inc. ("AbCellera") on an early-stage discovery program involving potent degraders as payloads for novel antibodies targeting tumor specific antigens. Since our inception in 2016, we have received clearance from the U.S. Food and Drug Administration,Administration or (the FDA,"FDA") for multiple investigational new drug applications,applications or INDs,("INDs") and successfully advanced several programs into clinical trials. In addition, we have other differentiated proprietary programs in various stages of preclinical development.

Myeloproliferative neoplasms ("MPN") are hematopoietic disorders arising from clonal expansion of hematopoietic stem cells ("HSC") in the bone marrow. Current treatment options for MPN patients offer symptomatic benefit but fail to eliminate disease-initiating clonesclones, leading to treatment resistance and progression to secondary acute myeloid leukemia. Therapeutic approaches that can selectively eliminate disease-initiating HSCs and induce molecular remission are an unmet medical need.

PRT12396PRT12396, our lead, mutant-selective JAK2V617F inhibitorinhibitor, received IND clearance from the U.S. FDA, as announced in February 2026, and recentlyis weenrolling initiated and commenced enrollmentpatients into a Phase 1 study of PRT12396 in patients with polycythemia vera (PV) and myelofibrosis (MF). The Phase 1 study of PRT12396 is an open-label, multi-center, safety and efficacy study. The primary endpoints of the study include safety, efficacy and PK profile.

As previously announced onin November 4, 2025, we entered into an exclusive option agreement (the "Exclusive Option Agreement") with Incyte Corporation ("Incyte") to acquire our mutative selective JAK2V617F inhibitor program (the “Program”) for patients with myeloproliferative neoplasms. Under the Option Agreement, Incyte received an exclusive option to acquire our entire right, title, and interest in and to certain assets, properties, and rights related to the JAK2V617F inhibitor program, including our library of preclinical candidates (collectively, the “Transferred Assets”). We expect to advance the JAK2V617F program to pre-defined milestones. Incyte may elect to exercise its exclusive option during the option period to acquire the program and associated assets from us for $100 million. As the JAK2V617F program candidates advance in the clinic, we would be eligible to receive up to $775 million in additional clinical and regulatory milestones, and single digit royalties on global net sales. Combined, total potential cash payments from the transaction, excluding royalties, could reach up to $910 million.

Drawing on our expertise in targeted protein degradation, we have discovered and optimized a series of proprietary degrader payloads for use in discovering and developing DACs. We disclosed first data at the 36th EORTC-NCI-AACR Symposium in October 2024 describing preclinical proof-of-concept using a novel, potent SMARCA2/4 dual degrader as a degrader payload conjugated to multiple antibodies. Prelude’s SMARCA2/4 dual degraders have shown picomolar potency with potential for increased efficacy, selectivity and improved therapeutic index. DACs have potential to expand the reach of SMARCA degrader technology to cancers without SMARCA4 mutations.

Since inception, we have devoted substantially all of our resources to developing product and technology rights, conducting research and development, organizing and staffing our company, business planning and raising capital. We have incurred recurring losses, the majority of which are attributable to research and development activities, and negative cash flows from operations. We have funded our operations primarily through the sale of convertible preferred stock and common stock. Our net loss was $10.4$24.3 million and $32.1$63.3 million for the threesix months ended MarchJune 31,30, 2026 and 2025, respectively. As of MarchJune 31,30, 2026, we had an accumulated deficit of $693.4$707.4 million. Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures. Our ability to generate product revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of one or more of our current or future product candidates. We expect to continue to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates through all stages of development and clinical trials and, ultimately, seek regulatory approval. In addition, if we obtain marketing approval for any of our product candidates, we expect to incur significant commercialization expenses related to product manufacturing, marketing, sales and distribution. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical trials and our expenditures on other research and development activities.

To date, we have not recognized any revenue from product sales, and we do not expect to generate any revenue from the sale of products in the foreseeable future. During the three and six months ended MarchJune 31,30, 2026, we recognized revenue from our Exclusive Option Agreement with Incyte. If our development efforts for our product candidates are successful and result in regulatory approval, or license agreements with third parties, we may generate revenue in the future in the form of milestone payments, royalties, or product sales. However, there can be no assurance as to when we will generate such revenue, if at all.

costs of funding research performed by third parties, including pursuant to agreements with clinical research organizations,organizations or CROs,("CROs") that conduct our clinical trials, as well as investigative sites, consultants and CROs that conduct our preclinical and nonclinical studies;

expenses incurred under agreements with contract manufacturing organizations,organizations or CMOs,("CMOs") including manufacturing scale-up expenses and the cost of acquiring and manufacturing preclinical study and clinical trial materials;

We expect to continue to incur general and administrative expense in the future to support our continued research and development activities and potential commercialization efforts. These expenses will likely include costs related to personnel and fees to outside consultants and legal support, among other expenses. The costs associated with being a public company include expenses related to services associated with maintaining compliance with the requirements of Nasdaq and the Securities and Exchange Commission ("SEC"), insurance and investor relations costs. If any of our current or future product candidates obtains U.S. regulatory approval, we expect that we would incur significantly increased expenses associated with building a sales and marketing team.

Comparison of the Three Months Ended MarchJune 31,30, 2026 and 2025

Revenue for the three months ended MarchJune 31,30, 2026 was related to our Exclusive Option Agreement with Incyte.

Research and development expenses decreased from $28.8$25.8 million for the three months ended MarchJune 31,30, 2025 to $13.6$16.1 million for the three months ended MarchJune 31,30, 2026. Included in research and development expenses for the three months ended MarchJune 31,30, 2026, was $1.1$1.0 million of non-cash expense related to stock-based compensation expense, including employee stock options, compared to $2.3$2.2 million for the three months ended MarchJune 31,30, 2025. Research and development expenses decreased primarily due to a decrease in expense related to our SMARCA2 clinical trials which we paused in 2025 along with a decrease in employee related expenses due to the workforce reduction in the second half of 2025. Research and development expenses may fluctuate from period to period depending upon the stage of certain projects and the level of preclinical and clinical trial-related activities.

Research and development expenses by program are summarized in the table below. During the fourth quarter of 2025, the Company announced that it decided to pause the clinical development of its SMARCA2 degrader program which is comprised of PRT3789 and PRT7732 and prioritize allocation of resources to advancing the JAK2 V617F and K(lysine) acetyltransferase 6A (KAT6A) selective degrader programs. The expense included in other arerepresents programs that the Company has paused or discontinued, including the previously mentioned SMARCA2 degrader programs. Corresponding program expenseexpenses for earlier periods have been recast. The following table summarizes the significant expense categories for the three months ended MarchJune 31,30, 2026 and 2025.

General and administrative expenses decreased from $5.8$6.4 million for the three months ended MarchJune 31,30, 2025 to $5.2$5.0 million for the three months ended MarchJune 31,30, 2026. The decrease was primarily driven by a decrease in non-cash expense related to stock-based compensation expense. Included in general and administrative expenses for the three months ended MarchJune 31,30, 2026, was $0.9$1.0 million of non-cash expense related to stock-based compensation expense compared to $1.6 million for the three months ended MarchJune 31,30, 2025. The decrease was primarily driven by a decrease in non-cash expense related to stock-based compensation expense.

Other income, net increased from $2.5$1.0 million for the three months ended MarchJune 31,30, 2025, to $3.8$1.5 million for the three months ended MarchJune 31,30, 2026 primarily due to interest earned on the receipt and recognitioninvestment of researchour andcash developmentreceived taxfrom credits.the April Offering.

At MarchJune 31,30, 20262026, the Company had cash, cash equivalents, restricted cash and marketable securities totaling $84.8$155.2 million. Subsequent to March 31, 2026, the Company sold 16,611,014 shares of its voting common stock at a price of $4.44 per sharemillion and pre-funded warrants to purchase up to 3,659,252 shares of its common stock at a price of $4.4399 per pre-funded warrant, resulting in gross proceeds of approximately $90.0 million. See Note 13 - Subsequent Events for additional information. Based on preliminary estimates, the Company believes these funds will be sufficient to fund its operating expenses and capital expenditure requirements for at least the next twelve months from the filing date of this Quarterly Report on Form 10-Q.

In May 2024, we filed a shelf registration statement (the "2024 Shelf Registration Statement") with the Securities and Exchange Commission for the issuance of common stock, preferred stock, debt securities, warrants, subscription rights and units up to an aggregate amount of $400 million. The 2024 Shelf Registration statementStatement was declared effective on June 10, 2024. The 2024 Shelf Registration statementStatement expires in May 2027,2027. and asAs of MarchJune 31,30, 2026, there was $400$310 million remaining under the 2024 Shelf Registration Statement. Subsequent to March 31, 2026, the Company sold 16,611,014 shares of its voting common stock at a price of $4.44 per share and pre-funded warrants to purchase up to 3,659,252 shares of its common stock at a price of $4.4399 per pre-funded warrant, resulting in gross proceeds of approximately $90.0 million under the 2024 Shelf Registration Statement.

In March 2023, we entered into an Open Market Sales Agreement (the "Sales Agreement") with Jefferies LLC, as the sales agent, pursuant to which we may offer and sell shares of our common stock. In accordance with the terms of the Sales Agreement on March 12, 2026, we filed a prospectus supplement under our 2024 Shelf Registration Statement, pursuant to which we may offer and sell shares of our common stock having an aggregate offering price of up to $25.0 million from time to time through Jefferies acting as sales agent. At June 30, 2026, there was $25.0 million remaining under the Sales Agreement.

During the threesix months ended MarchJune 31,30, 2026, we used $21.7$37.3 million of cash in operating activities. Cash used in operating activities reflected our net loss of $10.4$24.3 million and a $13.7$17.8 million net decrease in our operating assets and liabilities offset by noncash charges of $2.4$4.8 million, which primarily consisted of stock-based compensation. The primary use of cash was to fund our operations related to the development of our product candidates.

During the threesix months ended MarchJune 31,30, 2025, we used $34.2$60.3 million of cash in operating activities. Cash used in operating activities reflected our net loss of $32.1$63.3 million and a $6.9$6.1 million net increasedecrease in our operating assets and liabilities offset by noncash charges of $4.7$9.1 million, which primarily consisted of stock-based compensation. The primary use of cash was to fund our operations related to the development of our product candidates.

During the threesix months ended MarchJune 31,30, 2026, net cash providedused byin investing activities of $8.5$57.0 million consisted of $90.0 million in purchases of marketable securities, partially offset by $33.0 million in proceeds from maturities of marketable securities. During the threesix months ended MarchJune 31,30, 2025, net cash usedprovided inby investing activities of $62.2$73.7 million consisted primarily of $71.7$107.9 million in proceeds from maturities of marketable securities, partially offset by $9.5$34.1 million in purchases of marketable securities.

During the threesix months ended MarchJune 31,30, 2026, net cash usedprovided inby financing activities primarily related to paymentsthe ofproceeds received from the April Offering, partially offset by offering costs.costs related to the April Offering. During the threesix months ended MarchJune 31,30, 20252025, net cash used in financing activities was primarily for principal payments on our finance lease.

During the three months ended MarchJune 31,30, 2026, there were no other material changes to our critical accounting policies and estimates from those described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Critical Accounting Estimates” in our 2025 Annual Report on Form 10-K.