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

We have invested a significant portion of our efforts and financial resources in the research and development of our product candidates, including avutometinib and defactinib, for which the FDA has accepted for review our NDA under the accelerated approval pathway for the treatment of adult patients with recurrent LGSOC, who received at least one prior systemic therapy and have a KRAS mutation.candidates. Our ability to generate product revenues will depend heavily on the successful commercialization and development of our product candidates. The success of our product candidates will depend on several factors, including the following:

IfEven avutometinibthough AVMAPKI FAKZYNJA CO-PACK has received accelerated approval in the U.S., and defactinib,even if we receive marketing approval for an expanded indication for our combination product or any of our other product candidates,candidates receives marketing approval, suchour products and product candidates may nonetheless fail to gain sufficient market acceptance by physicians, patients, healthcare payors and others in the medical community. If avutometinibAVMAPKI andFAKZYNJA defactinibCO-PACK does not achieve an adequate level of acceptance, or if we are unable to increase market acceptance of avutometinibAVMAPKI andFAKZYNJA defactinibCO-PACK as compared to existing or competitive products, we may not generate significant product revenues and we may not become profitable. The degree of market acceptance of avutometinibAVMAPKI andFAKZYNJA defactinib,CO-PACK, or any of our other product candidates, if approved for commercial sale, will depend on a number of factors, including:

Before obtaining marketing approval from regulatory authorities for the sale of our product candidates, we must complete 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 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, and interim results of a clinical trial do not necessarily predict final results. For example, a further review and analysis of this data may change the conclusions drawn from this unaudited data indicating less promising results than we currently anticipate.

The FDA and foreign regulatory authorities may determine that the results from our ongoing and futurefutunew drure trials do not support regulatory approval and may require us to conduct an additional clinical trial or trials. If these agencies take such a position, the costs of development of our product candidates could increase materially and their potential market introduction could be delayed or abandoned. The regulatory agencies could also require that we conduct additional clinical, nonclinical or manufacturing validation studies and submit that data before it will consider ana NDA.new drug application. Our product development costs will also increase if we experience delays in clinical testing or marketing approvals. We do not know whether any clinical trials will begin as planned, will need to be restructured or will be completed on schedule, or at all. Significant clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow our competitors to bring products to market before we do and impair our ability to successfully commercialize our product candidates and may harm our business and results of operations.

Preclinical studies and any positive preliminary, initial “top-line,” and interim data from our clinical trials of our product candidates may not necessarily be predictive of the results of ongoing or later clinical trials. Even if we are able to complete our planned clinical trials of our product candidates according to our current development timeline, the positive results from clinical trials of our product candidates may not be replicated in subsequent clinical trial results. Also, our later stage clinical trials could differ in significant ways from earlier stage clinical trials, which could cause the outcome of the later stage trials to differ from our earlier stage clinical trials. For example, these differences may include changes to inclusion and exclusion criteria, efficacy endpoints and statistical design. Many companies in the pharmaceuticalbiotechnology and biotechnologypharmaceutical industries, including us, have suffered significant setbacks in late stage clinical trials after achieving positive results in an earlier stage of development. If we fail to produce positive results in our planned clinical trials of any of our product candidates, the development timeline and regulatory approval and commercialization prospects for our product candidates, and, correspondingly, our business and financial prospects, would be materially adversely affected.

Research on the use of small molecules to cause cell death, inhibition of tumor growth, and disruption of the tumor microenvironment is an emerging field and, consequently, there is still uncertainty about whether defactinibdefactinib, avutometinib and avutometinibVS-7375 are effective in improving outcomes for patients with cancer.

Our estimates of the patient population, pricing and revenue opportunities for our product candidates, including for KRAS mutant patients with recurrent LGSOC, are based on a number of internal and third-party estimates, including, without limitation, internal forecasts of potential market penetration, the median duration of treatment from initial interim clinical data and the assumed prices at which we can commercialize our product candidates. These estimates may be inaccurate or based on imprecise data. If approved by the FDA, theThe market opportunity of AVMAPKI FAKZYNJA CO-PACK and our product candidatescandidates, if approved, will depend on, among other things, acceptance by the medical community, patient access, drug pricing and reimbursement. The number of patients in the addressable market may turn out to be lower than we estimate, patients may not be otherwise amenable to treatment with our drugs, or new patients may become increasingly difficult to identify or gain access to, all of which may significantly harm our business, financial condition, results of operations, and prospects.

In addition, even if we obtain approval for any of our product candidates, such approvals may be for more limited patient populations than we had anticipated,anticipated and the potential market for our product candidates will be smaller than our current estimates. Obtaining approval for only a smaller patient population of our target indications for which we anticipate seeking approval would have a materially adverse effect on our ability to achieve commercialization and generate revenues.

Part of our current business model involves conducting clinical trials to study the effects of combining our product candidates with other approved and investigational targeted therapies, chemotherapies, and immunotherapies to treat patients with cancer. Regulatory approval for a combination treatment generally requires clinical trials to evaluate the activity of each component of the combination treatment. As a result, it may be more difficult and costly to obtain regulatory approval of our product candidates for use as part of a combination treatment than obtaining regulatory approval of our product candidates alone. In addition, we also risk losing the supply of any approved or investigational product being combined with our product candidate in these clinical trials. Furthermore, the potential market opportunity for our product candidates is difficult to estimate precisely. For instance, if one of our product candidates receives regulatory approval from a combination study, it may be approved solely for use in combination with the approved or investigational product in a particular indication and the market opportunity our product candidate would be dependent upon the continued use and availability of the approved or investigational product. In addition, because physicians, patients, and third-party payors may be sensitive to the addition of the cost of our product candidates to the cost of treatment with the other products, we may experience downward pressure on the price that we can charge for our product candidates if they receive regulatory approval. Further, we cannot be sure that physicians will view our product candidates, if approved as part of a combination treatment, as sufficiently superior to a treatment regimen consisting of only the approved or investigational product. Additionally, the adverse side effects of our product candidates may be enhanced when combined with other products. If such adverse side effects are experienced, we could be required to conduct additional pre-clinicalpreclinical and clinical studies, and if such adverse side effects are severe, we may not be able to continue the clinical trials of the combination therapy because the risks may outweigh the therapeutic benefit of the combination.

The development and commercialization of new drug 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 biotechnology companies worldwide. There are a number of large pharmaceutical and biotechnology companies that currently market and sell products or are pursuing the development of products for the treatment of the disease indications for which we are developing our product candidates, including Abbvie, AstraZeneca, Boehringer Ingelheim, Bristol Myers Squibb Company, Chugai, D3 Bio, Eli Lilly, Erasca, Genentech, GenFleet, Incyte Corporation, Jacobio, Jiangsu Hengrui Pharmaceuticals Company Ltd, Novartis AG, Pfizer, Genentech, Inc., AstraZeneca PLC, BMS, Amgen, Revolution Medicines, Inc., BeiGene Ltd., Quanta Therapeutics, Inc.,Ranok Erasca,Therapeutics, Inc.,Revolution RocheMedicine, HoldingTyligand AG, Incyte Corporation and Eli Lilly and CompanyBioscience and others. Some of these competitive products and therapies are based on scientific approaches that are the same as or similar to our approach, and others are based on entirely different approaches. Potential competitors also include academic institutions, government agencies, and other public and private research organizations that conduct research, seek patent protection, and establish collaborative arrangements for research, development, manufacturing, and commercialization.

Many of our competitors have significantly greater financial resources and expertise than we do in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved products. Mergers and acquisitions in the pharmaceuticalbiotechnology and biotechnologypharmaceutical 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 and management personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs. Additionally, new developments, including the development of other drug technologies and methods of preventing the incidence of disease, occur in the pharmaceutical and medical technology industries at a rapid pace. These developments may render our product candidates obsolete or noncompetitive.

We intend to seek regulatory approval for our product candidates in countries outside of the United StatesU.S. and expect that these countries will be important markets for our products, if approved. Marketing our products in these countries will require separate regulatory approvals in each market and compliance with numerous and varying regulatory requirements. The regulations that apply to the conduct of clinical trials and approval procedures vary from country to country and may require additional testing. Moreover, the time required to obtain approval may differ from that required to obtain FDA approval. In addition, in many countries outside the United States,U.S., a drug must be approved for reimbursement before it can be approved for sale in that country. Approval by the FDA does not ensure approval by regulatory authorities in other countries or jurisdictions, and approval by one foreign regulatory authority does not ensure approval by regulatory authorities in other foreign countries or by the FDA. Failure to obtain regulatory approval in one country may have a negative effect on the regulatory approval process in others. Further, we and our collaboration partners are currently conducting clinical trials, and may in the future conduct additional clinical trials, outside the United States,U.S., including the Phase 1/2 clinical trial evaluating VS-7375 by GenFleet in China. Although the FDA may accept data from clinical trials conducted outside the United States, acceptance of these data is subject to conditions imposed by the FDA. For example, the FDA will generally not approve the application unless the data are applicable to the United StatesU.S. population and United StatesU.S. medical practice and the FDA is able to validate the data through an on-site inspection or other appropriate means. The FDA or any comparable foreign regulatory authority may not accept data from trials conducted outside of the United StatesU.S. or the applicable jurisdiction, which may result in the need for additional trials that could be costly and time consuming and could result in the product candidate not receiving approval for commercialization in the applicable jurisdiction. The foreign regulatory approval process may include all of the risks associated with obtaining FDA approval. We may not obtain foreign regulatory approvals on a timely basis, if at all. We may not be able to file for regulatory approvals and may not receive necessary approvals to commercialize our products in any foreign market.

Avutometinib and defactinib are being administered and studied in our Phase 1, Phase 2, and Phase 3 clinical trials, and VS-7375 is being administered and studied in our Phase 1 and Phase 2 clinical trials and the development program continues to progress. For bothavutometinib, avutometinibdefactinib, and defactinib,VS-7375 the toxicities reported to date have been predictable and appear to be manageable.

In both domestic and foreign markets, any product candidates that may receive marketing approval in the future will depend, in part, on favorable pricing as well as the availability of coverage and amount of reimbursement by third partythird-party payors, including governments and private health plans. Substantial uncertainty exists regarding coverage and reimbursement by third partythird-party payors of newly approved health care products.

Outside the United States, some countries require approval of the sale price of a drug before the product can be marketed. In many such countries, the pricing review period begins after marketing or product licensing approval is granted. In some foreign markets, prescription pharmaceutical pricing remains subject to continuing governmental control even after initial approval is granted. As a result, we might obtain marketing approval for a product in a particular country,country but then be subject to price regulations that delay our commercial launch of the product, possibly for lengthy time periods, and negatively impact the revenues we are able to generate from the sale of the product in that country. Adverse pricing limitations may hinder our ability to recoup our investment in product candidates, even if those product candidates obtain marketing approval.

Cost containment is a key trend in the United States and elsewhere. Third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications. Increasingly, third-party payors are requiring that drug companies provide them with predetermined discounts from list prices and are challenging the prices charged for medical products. We cannot be sure that coverage and reimbursement will be available for any product that we commercialize and, if reimbursement is available, the level of reimbursement. Coverage and reimbursement may impact the demand for, or the price of, any product candidate for which we obtain marketing approval. If coverage and reimbursement are not available or reimbursement is available only to limited levels, we may not be able to successfully commercialize the product candidates for which we may obtain marketing approval.

We face an inherent risk of product liability exposure related to the testing of our product candidates in human clinical trials and will face an even greater risk if we commercially sell any other products we may develop. If we cannot successfully defend ourselves against claims that our product candidates or products caused injuries, we will incur substantial liabilities. Regardless of merit or eventual outcome, liability claims may result in:

We currently hold $10.0 million in product liability insurance coverage in the aggregate, with a per incident limit of $10.0 million, which may not be adequate to cover all liabilities that we may incur. We have in the past and may in the future need to increase our insurance coverage as we commercialize any future product candidates or if we initiate additional clinical trials in the United States and around the world. Insurance coverage is increasingly expensive. We may not be able to maintain insurance coverage at a reasonable cost or in an amount adequate to satisfy any liability that may arise.

On August 24, 2023, we entered into the GenFleet Agreement pursuant to which we obtained three GenFleet Options that may be exercised on a program-by-program basis. In December 2023, we announced the selection of a potential best-in class oral and selective KRAS G12D (ON/OFF) inhibitor VS-7375 as the lead program. GenFleet is currently conducting a Phase 1/2 trial in China evaluating VS-7375 in patients with KRAS G12D-mutated advanced solid tumors. In January 2025, we exercised early the GenFleet Option for the lead compound VS-7375 and expect to initiateinitiated a Phase 1/2a study in middle of 2025 in the United States.U.S.

Pursuant to the GenFleet Agreement, we are reliant on GenFleet to fulfilfulfill their responsibilities including ongoing discovery and lead optimization for the second and third programs and execution of the Phase 1 clinical trials for the second and third programs. Accordingly, our ability to realize the anticipated benefits and success of the GenFleet Agreement is dependent upon GenFleet fulfilling their obligations. Furthermore, we have entered into a supply agreement with GenFleet pursuant to which we expect to obtain VS-7375 finished product from GenFleet for use in our planned clinical trial in the United States. If GenFleet does not perform under the supply agreement, our ability to obtain VS-7375 and consequently our current and planned clinical trial in the United States investigating VS-7375 will be materially adversely impacted. If GenFleet does not successfully carry out their responsibilities, the benefits of the GenFleet Agreement and our collaboration with GenFleet may not be realized.

Since inception, we have incurred significant operating losses. As of December 31, 2024,2025, we had an accumulated deficit of $955.5$1.165 million.billion To date, we have generated minimal product revenues and have financed our operations primarily through public and private offerings of our common stock, preferred stock, warrants and pre-funded warrants, offerings of convertible notes, sales of our common stock pursuant to our at-the-market equity offering programs, our Note Purchase Agreement (the “Note Purchase Agreement”) with RGCM SA LLC, as purchaser agent, Oberland Capital Management LLC (“Oberland”) and certain funds managed by Oberland, as purchasers, (together with the other purchasers party thereto referred to as the “Note Purchase Agreement Purchasers”) our, former loan and security agreement (the “Loan Agreement”) with Oxford Finance LLC (“Oxford”), our loan and security agreement, as amended, with Hercules Capital Inc. (“Hercules”),agreements, upfront payments under our license and collaboration agreements with Yakult, CSPC,Honsha Co., Ltd. (“Yakult”), CSPC Pharmaceutical Group Limited (“CSPC”), and Sanofi, and the upfront payment and milestone payments under the Secura APA. We have devoted substantially all of our efforts to research and development. We expect to continue to incur significant expenses and may incur operating losses for the foreseeable future. The net losses we incur may fluctuate significantly from quarter to quarter. We anticipate that our expenses will increase substantially if and as we:

We expect our expenses to increase in connection with our ongoing activities, particularly in connection with our planned commercialization of avutometinibAVMAPKI andFAKZYNJA defactinibCO-PACK and the continued clinical development of our other product candidates. We expect our cash,cash and cash equivalents and investments at December 31, 20242025, combined with the proceeds from exercise of warrants in January 2026 along with revenue we expect to generate from sales of AVMAPKI FAKZYNJA, will not be sufficient to fund our current operating plan and capital expenditure requirements for the next 12 months from the issuance of these financial statements. We may need to obtain additional funding in connection with our continuing operations, including for our clinical development programs. Our future capital requirements will depend on many factors, including:

Conducting clinical trials is a time consuming, expensive and uncertain process that takes years to complete, and we may never generate the necessary data or results required to obtain marketing approval of any of our product candidates. AlthoughEven though the FDA has accepted for review our NDA under the accelerated approval pathway for avutometinib in combination with defactinib for the treatment of adult patients with recurrent LGSOC who received at least one prior systemic therapy and have a KRAS mutation, the NDA may not be approved byAVMAPKI theFAKZYNJA FDACO-PACK and, even if approved, avutometinib and defactinibit may not achieve commercial success. We expect that ourOur commercial revenues will beare derived from sales of products. EvenAccordingly, ifeven ourthough productwe candidatesreceived gainregulatory approval,approval for AVMAPKI FAKZYNJA CO-PACK, it may take several years to achieve a significant level of sales, and as a result we may need to continue to rely on additional financing to further our clinical development objectives. Adequate additional financing may not be available to us on acceptable terms, or at all.

Unfavorable macroeconomic conditions and other adverse macroeconomic factors have resulted, among other matters, in tightening in the debt and equity markets, and high levels of inflation. Similarly, changes in U.S. federal policy that affect the geopolitical landscape could give rise to circumstances outside our control that could have negative impacts on our business operations. For example, on March 4, 2025, the U.S.current presidential administration has imposed aor 25%is tariffconsidering imposing tariffs on importsa fromlarge Canada and Mexico that do not satisfy the U.S.-Mexico-Canada Agreement rulesnumber of origincountries, reciprocal tariffs with certain exemptionscountries and aparticularized 20% additional tarifftariffs on importscertain fromtypes China.of foreign goods, including pharmaceutical products and components manufactured outside of the U.S. Historically, tariffs have led to increased trade and political tensions. In response to tariffs, other countries have implemented retaliatory tariffs on U.S. goods. Political tensions resulting from trade policies could reduce trade volume, investment, technological exchange and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets. Tightening of the equity markets makes it more difficult to raise capital at a reasonable valuation or at all. AnyTariffs, economic sanctions, and other changes in political, trade, regulatory, and economic conditions, including U.S. trade policies,policy have in the past and could havein athe materialfuture adversenegatively effect onaffect our business, financial conditioncondition, orand results of operations.

As of December 31, 2024,2025, we had U.S. federal and state NOL carryforwards of approximately $370.6$460.5 million and $56.7$99.5 million, respectively. As of December 31, 2024,2025, we also had federal and state tax credits of $2.6$12.3 million and $0.2$0.7 million, respectively, which may be used to offset future tax liabilities. The NOL and tax credit carryforwards will expire at various dates through 2044,2045, except for $333.4$423.3 million of federal NOL carryforwards which may be carried forward indefinitely. Sections 382 and 383 of the Internal Revenue Code (“IRC”) and similar provisions under state law limits the annual use of NOL carry-forwards and tax credit carryforwards, respectively, following an ownership change pursuant to section 382 of the IRC and similar state provisions. In general, an ownership change occurs for purposes of Section 382 if there are certain cumulative changes in the ownership interest of significant stockholders over a three-yearthree year period in excess of-year period in excess of 50%.

On January 13, 2025 (the “Note Purchase Agreement Closing Date”), we entered into the Note Purchase Agreement pursuant to which we may sell to the Note Purchase Agreement Purchasers, and the Note Purchase Agreement Purchasers may buy from us notes (the “Notes”) in an aggregate principal amount not to exceed $150.0 million,million. consistingWe completed an initial sale of $75.0 million principal amount of Notes on the followingNote Purchase Agreement Closing Date. In addition, the we may issue and sell additional Notes with aggregate principal amount of up to $75.0 million as follows:

Our operations to date have been organizing and staffing our company, business planning, raising capital, identifying and acquiring potential product candidates, undertaking preclinical studies and clinical trials for our product candidates and initiating U.S. commercial operations following the approval of COPIKTRA through our ownership period ending in September 2020. We have financed our operations to date primarily through public and private offerings of our common stock, pre-funded warrants and pre-funded warrants, offerings of convertible notes, sales of common stock under our at-the-market equity offering programs,program, our loan and security agreement executed with Hercules in March 2017, as amended, the Loan Agreement, the Note Purchase Agreement, former loan agreements, the upfront payments and milestone payments under our license and collaboration agreements with Sanofi, CSPC, and Yakult, the upfront payment and milestone payments received under the Secura APA, and sales of Series B Convertible Preferred Stock. Additionally, fromwe ourhave U.S. commercial launch of COPIKTRA on September 24, 2018, through our ownership period ending in September 2020, wealso financed a portion of our operations through product revenue.revenue, including from AVMAPKI FAKZYNJA CO-PACK, beginning with our U.S. commercial launch in May 2025 and from COPIKTRA, from its U.S. commercial launch in September 2018 through our sale of the COPIKTRA license in September 2020.

As of December 31, 2024,2025, we had an accumulated deficit of $955.5$1,165.0 million. Our net loss was $130.6$209.5 million, $87.4$130.6 million, and $73.8$87.4 million, for the years ended December 31, 2025, 2024, and 2023, and 2022, respectively. As of December 31, 2024, we had cash, cash equivalents, and investments of $88.8 million. In accordance with applicable accounting standards, we evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern within 12 months after the date of the issuance of the consolidated financial statements. We anticipate to incur significant expenses and operating losses may continue for the foreseeable future since we do not yet have regulatory approval to sell any of our product candidates, andas we continue to incur operating costs to execute our strategic plan, including costs related to research and development of our product candidates and commercial readiness activities. As aof resultDecember 31, 2025, we had cash, and cash equivalents of the$205.0 assessmentmillion and received $29.4 million in accordanceJanuary 2026 from exercises of warrants. We expect our existing cash resources including proceeds from exercise of warrants in January 2026, along with therevenue applicablewe accountingexpect standards,to thesegenerate conditionsfrom raisesales substantialof doubtAVMAPKI aboutFAKZYNJA CO-PACK, will be sufficient to fund our abilityplanned tooperations continue as a going concern forthrough 12 months afterfrom the date theof issuance of these consolidated financial statements are issued.statements.

We expect to finance our operations with our existing cash, cash equivalents and investments, through potential future milestones and royalties received pursuant to the Secura APA, through the Note Purchase AgreementAgreement, through future product revenues or through other strategic financing opportunities that could include, but are not limited to collaboration agreements, future offerings of our equity, or the incurrence of debt. However, given the risks associated with these potential strategic or financing opportunities, they are not deemed probable for purposes of the going concern assessment. If we fail to obtain additional futurecapital capital,or generate sufficient revenue from our commercialization activities in the future, we may be unable to complete our planned preclinical studies and clinical trials and obtain approval of certain investigational product candidates from the FDA or foreign regulatory authorities. Therefore, there is substantial doubt about our ability to continue as a going concern.

SaleSales of licensesintellectual andproperty related assetsrepresents revenue to date have been generated throughfrom ourthe sale of our duvelisibCOPIKTRA license and related assets to Secura. The sale included intellectual property related to duvelisib in oncology indications, certain existing duvelisib inventory, certain manufacturing equipment and, claims and rights under certain contracts pertaining to duvelisibduvelisib, including net contract prepaid balances.

Research and development expenses consist of costs associated with our research activities, including the development of our product candidates. Research and development expenses include product/ product candidate and/or project-specific costs, as well as unallocated costs. We allocate the expenses related to external research and development services, expenses incurred by third parties such as CROs, clinical sites, manufacturing organizations and consultants, by project and/or product candidate. We use our employee and infrastructure resources in a cross-functional manner across multiple research and development projects. Our project costing methodology does not allocate personnel, infrastructure and other indirect costs to specific clinical programs or projects.

Costs for certain development activities, such as clinical trial expenses, are recognized based on an evaluation of the progress to completion of specific tasks using data such as patient enrollment, clinical site activations, and other information provided us by our vendorsbased on their actual costs incurred or level of effort expended.expended provided by our vendors. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected on the consolidated balance sheets as prepaid expenses and other current assets or accrued expenses.

Other expense for each of the years ended December 31, 2025, 2024 and 2023 wasprimarily comprised ofrepresent transaction losses recognized due to changes in foreign currency exchange rates. Other income for the year ended December 31, 2022 was comprised of a gain on the sale of fixed assets and transaction gains due to changes in foreign currency exchange rates.

Interest expense reflects interest expense due on our Loan Agreement with Oxford and our convertible notes, interest expense related to vendor financing arrangements, as well as non-cash interest related to the amortization of debt discount and issuance costs.

The change in fair value of preferred stock tranche liability for the years ended December 31, 2024 and December 31, 2023, was comprised ofrepresents the mark-to-market adjustment related toof the second tranche right issued as part of the Securities Purchase Agreement (the “Series B Convertible Preferred Stock Securities Purchase Agreement”), dated January 24, 2023 with certain purchasers pursuant to which the Companywe agreed to sell and issue to the purchasers in a private placement up to 2,144,160 shares of its Series B Convertible Preferred Stock in two tranches. The preferred stock tranche liability expired in July 2024 and is no longer outstanding. There was no preferred stock tranche liability outstanding during the year ended December 31, 2022.2025.

The change in fair value of warrant liability for the yearyears ended December 31, 2025, and 2024 was comprised ofrepresents the mark-to-market adjustment relatedof tothe liability classified warrants issued as part of the July 2024 Offering (defined herein). There were no warrants outstanding during the yearsyear ended December 31, 2023, or December 31, 2022.2023.

Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which we have prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”). The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of certain assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our financial statements. On an ongoing basis, we evaluate our estimates and judgments, including those related to accrued and prepaid research and development expenses, stock-based compensation, revenuefair recognition,value of Notes and collaborativerevenue agreements,recognition described in greater detail below. We base our estimates on our limited historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

We recognize revenue when our customer obtains control of promised goods or services, in an amount that reflects the consideration whichthat we expect to receive in exchange for those goods or services in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606 Revenue from Contracts with Customers (“ASC 606”).

ForUpon salesthe sale of licenselicenses andor intellectual property,property that includeincorporate sale-based royalties, including milestone payments based on a level of sales, we evaluate whether the royalties and sales-based milestones are considered probable of being achieved and estimate the amount of royalties to include over the contractual term using the expected value method and estimate the sales-based milestones using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated royalty and milestone value is included in the transaction price. Royalties and sales-based milestones for territories for which there is not regulatory approval are not considered probable until such regulatory approval is achieved. We evaluate factors such as whether consideration is outside of our control, timeline for when the uncertainty will be resolved and historical sales of COPIKTRA if applicable. There is considerable judgment involved in determining whether it is probable that a significant revenue reversal would not occur. At the end of each subsequent reporting period, we reevaluate the probability of achievement of all milestones subject to constraint and amount of royalty revenue to be received and, if necessary, adjust our estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment. At December 31, 2024,2025, we determined no future potential royalties pursuant to the Secura APA were not constrained.

We base our research and development expenses related to CROs on our estimates of the services received and efforts expended pursuant to quotes and contracts with CROs that conduct research and development on our behalf. The financial terms of these agreements are subject to negotiation, vary from contract to contractcontract, and may result in uneven payment flows. There may be instances in which payments made to our vendors will exceed the level of services provided and result in a prepayment of the research and development expense.expenses. InWhen accruingrecognizing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from our estimate, we adjust the accrual or prepaid accordingly. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and could result in us reporting amounts that are too high or too low in any particular period. To date, there have been no material differences between our estimates of such expenses and the amounts actually incurred.

For service-based awards, weWe recognize stock-based compensation expense for service-based awards, such as stock options,options and restricted stock units (“RSUs”), issued to employees, directors and consultants based on the grant date fair value of the awards on a straight-line basis over the requisite service period. In addition, we issue shares to employees under our employee stock purchase plan (“ESPP”) to employees.. The fair value of our stock options and ESPP grants is estimated at the date of grant using the Black-Scholes option pricing model. For determining fair value of stock options when the stock options are not at the money because of a modification, weWe are precluded from utilizing the simplified method as described in SEC SAB Topic 14.D.2 to calculate the expected term as a key assumption in the Black-Scholes pricing model.model when determining fair value of stock options not in the money because of a modification. Therefore, when valuing stock options that are not at the money, we utilize a binomial lattice model to calculate the fair value of the stock option.

We have also granted performance-based RSUs and stock options with terms that allow the recipients to vest in a specificcertain number of shares based upon the achievement of performance-based milestones as specified in the grants. Stock-based compensation expense associated with these performance-based RSUs and stock options is recognized if the performance condition is considered probable of achievement using management’s best estimates of the achievement of the performance-based milestones. If the actual achievement of the performance-based milestones varies from our estimates, stock-based compensation expense could be materially different than what is recorded in the period. The cumulative effect on current and prior periods of a change in estimate for performance-based RSUs and stock options will be recognized as compensation cost in the period of the revision,revision and recorded as a change in estimate.

During the year ended December 31, 2024,2025, we recorded $7.3$9.4 million of stock-based compensation expense. As of December 31, 2024,2025, there was approximately $6.0$5.4 million of unrecognized stock-based compensation related to stock options, which areis expected to be recognized over a weighted-average period of 2.12.2 years. As of December 31, 2024,2025, there was approximately $4.0$4.6 million of unrecognized stock-based compensation related to RSUs, which areis expected to be recognized over a weighted-average period of 2.31.9 years. See Note 2. Significant accounting policies and Note 8.11. Stock-based compensation to our consolidated financial statements located in this Annual Report on Form 10-K for further discussion of stock-based compensation.

Sale of COPIKTRA license and related assets revenue. Sale of COPIKTRA license and related assets revenue for the year ended December 31, 2024 (the “20242025 Period”) was $10.0$0.0 million compared to $0.0$10.0 million for the year2024 ended December 31, 2023 (the “2023 Period”).Period. Sale of COPIKTRA license and related assets revenue for the 2024 Period was comprised of one sales milestone of $10.0 million due upon Secura achieving cumulative worldwide net sales of COPIKTRA exceeding $100.0 million during the 2024 Period. The $10.0 million milestone payment was received by us in July 2024. There was no milestone achieved during the 2025 Period. Refer to Note 16. License, collaboration and commercial agreements to our consolidated financial statements located in this Annual Report on Form 10-K for additional details on the Secura APA.

Selling, generalGeneral and administrativeAdministrative expense.Expense. Selling, general and administrative expense for the 2024 Period was $43.6 million compared to $30.7$81.1 million for the 20232025 Period compared to $43.6 million for the 2024 Period. The increase of $12.9$37.5 million from the 20232024 Period to the 20242025 Period was primarily resulteda from an increase of $4.8 million in personnel related costs, including non-cash stock-based compensation, an increase of $4.7 million of costs in anticipationresult of the potentialfollowing launchincremental ofexpenses avutometinibincurred: and defactinib in LGSOC, an increase of $3.0 million in July 2024 Offering financing fees in the 2024 Period, and an increase of $1.0$28.2 million in consulting and professional fee,fees related to the launch of AVMAPKI FAKZYNJA CO-PACK for the treatment of KRAS mutant recurrent LGSOC, $8.2 million in personnel costs including non-cash stock-based compensation, $1.1 million in commercial operations expense, and $2.3 million in travel related and other costs. These increases were partially offset by $0.6a decrease of $2.2 million in financing fees for the offering of our Series B Convertible Preferred Stock in the 2023 Period.fees.

Other expense.Expense. Other expense ofwas $0.2 million for the 2025 Period compared to $0.1 million for the 2024 PeriodPeriod. andOther the 2023 Periodexpense was comprised of transaction losses due to changes in foreign currency exchange rates.rates in both periods.

We are a biopharmaceutical company committed to developing and commercializing new medicines to improve the lives of patients diagnosed with challenging RAS/MAPK pathway-driven cancers. We market AVMAPKI FAKZYNJA CO-PACK (avutometinib capsules; defactinib tablets) in the United States (“U.S.”), the first treatment specifically FDA-approved for adults with KRAS-mutated recurrent LGSOC who have received prior systemic therapy.

Our pipeline includes clinical-stage programs, preclinical research programs and externally partnered early-stageresearch programs. Our focus is on novel small molecule drugs developed both as monotherapy and in combination, which inhibit critical signaling pathways in cancer that promote cancer cell survival and tumor growth, including targeting RAS directly with KRAS G12D inhibition, targeting the pathway downstream with RAF/MEK inhibition, and targeting the parallel pathway that drives resistance with FAK inhibition. Our focusgoal is to expeditiously develop and deliver transformative therapies that truly change outcomes for people living with RAS/MAPK pathway-driven cancers.

The combination is being evaluated in an ongoing international Phase 3 trial, RAMP 301, in recurrent LGSOC with or without a KRAS mutation. The trial was fully enrolled, as of December 2025, and will serveserves as a confirmatory study for the initial indication and has the potential to expand the indication regardless of KRAS mutation status. The results will also be leveraged for potential geographic expansion. We expect to report a topline readout of the primary endpoint in the RAMMP 301 trial in middle of 2027.

VS-7375 is a potential best-in-class, potent, and selective oral KRAS G12D dual ON/OFF inhibitor. VS-7375 has a differentiated profile compared to other RAS inhibitors. Based on preclinical data, VS-7375 offers dual, potent inhibition of both ON and OFF states of KRAS G12D. We believe this correlates with better in vivo efficacy and durability versus ON-only RAS inhibitors. VS-7375 has demonstrated a high affinity for KRAS G12D with long residence time (18-24 hours) in preclinical models. We believe this correlates with a more rapid and durable suppression of pERK signaling (which controls growth and cell survival) when compared to other ON-only KRAS G12D inhibitors in tumor cell lines. The selective inhibition of VS-7375 to KRAS G12D has shown, in preclinical models, to spare T cell proliferation to maintain a normal healthy immune response, versus a RAS-multi-inhibitorRAS-multi-inhibitor, which impairs T cell proliferation at increasing concentrations of drug. The once daily (“QD”) oral dosing of VS-7375 achieves exposures corresponding to maximal tumor regressions across preclinical models for pancreatic, lung and colorectal cancers. Verastem announced in April 2025 that the U.S. Investigational New Drug (“IND”) application for (VS-7375-101) was cleared,cleared and initiated a Phase 1/2 clinical trial in June 2025 in patients with advanced KRAS G12D mutant solid tumors, including pancreatic ductal adenocarcinoma (“PDAC”),PDAC, non-small cell lung cancer (“NSCLC”) and colorectal cancer (“CRC”).

In April 2026 we branded the trials as the VS-7375 TARGET-D Clinical Trial Program. TARGET-D 101 (VS-7375-101) is a Phase 1/2 studydose escalation, dose expansion and combination-evaluation trial. In the TARGET-D 101 Phase 1/2 study, the Company cleared multiple monotherapy dose levelslevels, including the 1200 mg QD dose with no dose-limiting toxicities (“DLTs”) and no major toxicitiestoxicities. andPatients continuescontinue to dose-escalate.be evaluated at the 1200 mg QD dose level. The Company also cleared multiple dose levels in combination with cetuximab with no DLTs and higher doses are being evaluated.DLTs. The Company continuescompleted totargeted enrollenrollment in patients acrosswith variouspancreatic and lung cancer monotherapy cohorts and the colorectal cancer combination cohort with cetuximab in the Phase 1/2 study. Following recent feedback from the FDA, the Company is amendingamended its Phase 1/2 trial protocol to separate out disease-specific Phase 2 registration-directed trials for KRAS G12D mutated second line (“2L”) PDAC, 2L/ third line (“3L”) NSCLC and 2L+ or later CRC.

We shared multiple updates from GenFleet Therapeutics, our partner developing VS-7375, known as GFH375, in China.

As of MarchJune 31,30, 2026, we had an accumulated deficit of $1,201.6$1,236.3 million. Our net loss was $36.6$34.7 millionmillion, and$71.3 $52.1million, $25.9 million, $78.0 million for the three and six months ended MarchJune 31,30, 2026 and 2025, respectively. As of MarchJune 31,30, 2026, we had cash, cash equivalents, and investments of $181.7$136.4 million. In accordance with applicable accounting standards, we are required to evaluate whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern within twelve months after the date of the issuance of these condensed consolidated financial statements.

In our Annual Report on Form 10-K for the year ended December 31, 2025, filed on March 4, 2026, we disclosed that our existing cash resources, including proceeds from exercise of warrants in January 2026, along with revenue we expected to generate from sales of AVMAPKI FAKZYNJA CO-PACK, was expected to be sufficient to fund our planned operations through twelve months from the date of issuance of those consolidated financial statements. As of March 4, 2026, our liquidity analysis excluded projected expenses for the Phase 2 studies entitled TARGET-D 201, TARGET-D 202, and TARGET-D 203, as we had not yet formally committed to the spend for those studies. Subsequent to the filing of our Annual Report on Form 10-K for the year ended December 31, 2025, we initiated TARGET-D-201,TARGET-D 201, TARGET-D 202, and TARGET-D 203, resulting in a significant increase in projected research and development expenses. Consequently, the significant increase in costs we now expect to incur raises substantial doubt about our ability to continue as a going concern within the twelve months after the date of the issuance of these condensed consolidated financial statements.

Comparison of the three months ended MarchJune 31,30, 2026 and 2025

“N/M” - Percentage change is not meaningful (N/M) where the prior period amount is zero or not comparable.”comparable

We began commercial sales of AVMAPKI FAKZYNJA CO-PACK within the United States in May 2025, following receipt of FDA marketing approval on May 8, 2025. For the three months ended MarchJune 31,30, 2026 (the “2026 Quarter”) we recorded approximately $18.7$25.1 million of net product revenue. We did not recognize any product revenue duringFor the three months ended MarchJune 31,30, 2025 (the “2025 Quarter”). we recorded approximately $2.1 million of net product revenue.

CostsCost of sales – product.

CostsCost of sales – product for the 2026 Quarter was $3.8 million compared to $0.3 million for the 2025 Quarter. Cost of approximatelysales $2.8– millionproduct for the 2026 Quarter and 2025 Quarter consisted of costs associated with the manufacturing of AVMAPKI FAKZYNJA CO-PACK, royalties owed on such sales, and certain period costs including inventory write downs. The Company began capitalizing inventory upon receiving FDA approval for AVMAPKI FAKZYNJA CO-PACK on May 8, 2025. Prior to the FDA approval of AVMAPKI FAKZYNJA CO-PACK, expenses associated with the manufacturing of AVMAPKI FAKZYNJA CO-PACK were recorded as research and development expense. Certain costs of AVMAPKI FAKZYNJA CO-PACK units recognized as revenue during the 2026 Quarter and 2025 Quarter, or approximately $0.2 million and less than $0.1 million, respectively, were expensed prior to obtaining regulatory approval, therefore, are not included in cost of sales – product during this period. We expect cost of sales - product to increase in relation to product revenues as we deplete these inventories. We did not recognize any cost of sales – product during the 2025 Quarter.

CostsCost of sales – intangible amortization.

Cost of sales – intangible amortization for the 2026 Quarter and 2025 Quarter of approximately $0.3 million and $0.1 million, respectively, was related to finite-lived intangible assets related to AVMAPKI FAKZYNJA CO-PACK which we recognized and began amortizing during the second quarter of 2025. We did not recognize any cost of sales – intangible amortization for the 2025 Quarter.

Research and development expense for the 2026 Quarter was $38.2$41.3 million, compared to $29.2$24.8 million for the 2025 Quarter. The $9.1$16.6 million increase was primarily driven by a $4.7$7.4 million increase in investigator fees, a $3.7$5.5 million increase in contract research organization (“CRO”) costs, a $2.1 million increase in drug substance and drug product manufacturing costs, a $3.1 million increase in clinical supply costs, a $2.7 million increase in contract research organization (“CRO”) costs, and a $1.9$1.6 million increase in personnel costs, including non-cash stock-based compensation. These increases were partially offset by a $6.0 million decrease in license fees, reflecting an Option exercise fee payment made during the 2025 Quarter pursuant to the GenFleet Agreement, and a $1.0 million decrease in consulting expenses.

Selling, general and administrative expense for the 2026 Quarter was $22.3$27.4 million compared to $15.0$20.7 million for the 2025 Quarter. The $7.3$6.7 million increase was primarily driven by a $4.7 million increase in personnel costs, including non cash based stock-based compensation expense, a $2.2$4.3 million increase in commercial operations expenses, a $0.9$2.6 million increase in travelpersonnel andcosts, conferencesincluding andnon-cash based stock-based compensation expense, a $1.2 million increase in other general and administrative expenses, and a $0.3 million increase in consulting and professional fees.expenses. These increases were partially offset by a $0.8$1.4 million decrease in financingconsulting feesand relatedprofessional to the Note Purchase Agreement incurred in the 2025 Quarter.fees.

Other expense for the 2026 Quarter was less than $0.1 million compared to $0.1 million for the 2025 Quarter. Other expense for the 2026 Quarter and 2025 Quarter was comprised$0.1 million. Other expense for the 2026 Quarter and 2025 Quarter consisted of transaction losses due to changes in foreign currency exchange rates.

Interest expense for the 2026 Quarter was $0.4 million compared to $0.2 million for the 2025 Quarter. The $0.2 million increase from the 2025 Quarter to the 2026 Quarter was primarily driven by interest expense incurred as part of the vendor financing arrangement resulting in an increase of interest expense recorded in the 2026 Quarter.arrangement.

TheThere was no change in fair value of the warrant liability was $9.3 million income for the 2026 Quarter compared to $2.4$20.3 million expenseincome for the 2025 Quarter. There was no change in the fair value of the warrant liability for the 2026 Quarter as all the outstanding Warrants were either exercised or expired as of January 25, 2026. The $9.3$20.3 million income for the 2026 Quarter and $2.4 million expense for the 2025 Quarter was comprisedconsisted of the mark-to-market adjustment for the liability classified Warrants issued as part of the July 2024 Offering. The liability classified warrants decreased in value from December 31, 20252024 to when 8,391,666 Warrants were exercised in January 2025 primarily driven byas a reductionresult our stock price andof the expirationexercise of 37,5002,787,499 Warrants, resulting in $9.3 million incomeWarrants during the 2026quarter Quarter.and Thea liability classified warrants increaseddecrease in valuewarrant fromvaluation December 31, 2024due to whena 1,166,666 Warrants were exercised in March 2025 and March 31, 2025 primarily driven by an increase in ourlower stock price, resulting in a $2.4 million expense during the 2025 Quarter.price.

The change in fair value of Notes was $1.9$1.8 million for the 2026 Quarter compared to $4.4$3.0 million duringfor the 2025 Quarter. We elected the fair value option for the Notes and therefore changes in fair value, including interest, other than changes that are directly attributable to instrument specific credit risk are recorded as change in fair value of Notes in the condensed statements of operations and comprehensive loss. The decreasechange in fair value of Notes for the 2026 Quarter of $1.8 million was primarily driven by interest on the Notes. The change in fair value inof theNotes 2026 Quarter is a result offor the 2025 Quarter changeof $3.0 million was primarily driven by interest on the Notes and a reduction in fairrisk valuefree beingrate during the 2025 Quarter resulting in higher due to the revaluationvaluation of the note from its notional value to its fair value following issuance of the Notes in January 2025.Notes.

As of MarchJune 31,30, 2026, we had $181.7$136.4 million in cash, cash equivalents, and investments. We primarily invest our cash, cash equivalents and investments in U.S. Government money market funds, government bonds, corporate bonds and commercial paper of publicly traded companies.

The following table sets forth the primary sources and uses of cash for the 2026 QuarterPeriod and the 2025 QuarterPeriod (in thousands):

The use of cash in both periods resulted primarily from our net losses adjusted for non-cash charges and changes in the components of working capital. Our cash outflow from net losses adjusted for non-cash charges and adjustments was $43.5 million and $42.9$74.6 million for the 2026 QuarterPeriod and $84.2 million for the 2025 Quarter, respectively.Period. Non-cash charges and adjustments for the 2026 QuarterPeriod were primarily related to the change in fair value of common stock warrant liability and stock-based compensation expense. Non-cash charges and adjustments for the 2025 QuarterPeriod were primarily related to the change in fair value of warrant liability, non-cash changes in fair value of the Notes, the change in fair value of warrant liability, loss on debt extinguishment and stock-based compensation expense.

The cash provided by financing activities for the 2026 Period represents $29.4 million of proceeds from the exercise of Warrants, $0.7 million of proceeds received from insurance premium financing, and less than $0.1 million of proceeds received from the exercise of stock options and our employee stock purchase program,plan, partially offset by the $1.3$2.5 million repayment of ourrepayments under the vendor financing arrangement,arrangement and $0.2$0.5 million of payments for insurance premium financing. The cash provided by financing activities for the 2025 QuarterPeriod represents $100.1 million of net proceeds received from the issuance of common stock and pre-funded warrants, $75.0 million of proceeds received pursuant to the Note Purchase Agreement, $22.7 million of proceeds received under the August 2021 ATM, $7.4 million of proceeds received pursuant to the Stock Purchase Agreement, $4.1$13.8 million of proceeds from the exercise of Warrants, $1.2 million of proceeds received from insurance premium financing, and less than $0.1 million of proceeds received related to our employee stock purchase plan, partially offset by the $42.6 million repayment of our Loan Agreement, and $0.4$0.7 million of payments for insurance premium financing. Refer to Note 10. Debt to our unaudited condensed consolidated financial statements included in this quarterly report for additional details on the Note Purchase Agreement and Loan Agreement; Note 15. Capital Stock to our unaudited condensed consolidated financial statements included in this quarterly report for additional details on the 2025 Private Placement, the NoteStock Purchase Agreement,Agreement and the Warrants; Note 12. Notes Payable to our unaudited condensed consolidated financial statements included in this quarterly report for additional details on the finance agreement with FirstAFCO InsurancePremium Credit LLC related to insurance premium financing and the monthly payments of principal and interest related thereto; Note 13. Vendor Financing Arrangement to our unaudited condensed consolidated financial statements included in this quarterly report for additional details on the vendor finance agreement with IQVIA related to the master service agreement.