Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q and with our audited financial statements and notes thereto and management's discussion and analysis of financial condition and results of operations for the year ended December 31, 2024, included in our 2024 10-K. Unless the context requires otherwise, references in this report to "Boundless," the "Company," "we," "us," and "our" refer to Boundless Bio, Inc. In addition, in this report we refer to our extrachromosomal DNA directed therapeutic candidates as "ecDTx," which are under clinical or preclinical investigation and which have not yet been approved for marketing by the FDA or any other regulatory authority.

Overview

We are a clinical-stage precision oncology company dedicated to unlocking a new paradigm in cancer therapeutics that addresses the significant unmet need in patients with oncogene amplified tumors by interrogating extrachromosomal DNA (ecDNA), a root cause of oncogene amplification observed in 14% to 17% of cancer patients. ecDNA are large circular units of nuclear DNA that are a primary mechanism of gene amplification and are detected only in cancer cells, not in healthy cells. Despite tremendous advancements in treating cancer broadly, patients with oncogene amplified cancers generally derive little benefit from existing therapies, such as molecular targeted therapies or immunotherapies, and have worse survival rates than patients without oncogene amplification.

Using our proprietary Spyglass platform, we identify targets essential for ecDNA functionality in oncogene amplified cancer cells, then design and develop small molecule drugs called ecDNA-directed therapeutic candidates (ecDTx) to inhibit those targets, with the aim to prevent cancer cells from using amplified oncogenes to grow, adapt, and become resistant to existing therapies. Instead of directly targeting the proteins produced by amplified oncogenes, which is the approach of traditional targeted therapies, our ecDTx are intended to be synthetic lethal in tumor cells reliant on amplification biology. In the context of drug development, synthetic lethality is a therapeutic approach wherein using a drug to inhibit one target is lethal to cancer cells harboring a specific genetic alteration to a second target, but not lethal to healthy cells that lack the genetic alteration to the second target. Accordingly, our ecDTx are designed to preferentially kill amplification-dependent cancer cells, but not healthy cells. They are engineered to disrupt the underlying cellular machinery that enables functional amplification. To our knowledge, Spyglass is the only platform in the biopharma industry using ecDNA biology to identify specific druggable targets in oncogene amplified cancers. All of our ecDTx have been discovered internally and we retain global rights for all of our programs.

Below is a summary of our ecDTx programs and anticipated milestones and other developments. Additional information about our business and our ecDTx is included in Part I, Item 1, "Business," of our 2024 10-K and in Part I, Item 2, "Management's Discussion and Analysis of Financial Condition and Results of Operations," of our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2025 filed with the SEC on August 5, 2025 under the section entitled "Overview."

Our Programs and Anticipated Milestones

We are investigating BBI-355, a novel, oral, selective inhibitor of checkpoint kinase 1 (CHK1) designed to target replication stress in oncogene-amplified cancers, in combination with BBI-825, a novel oral, selective inhibitor of ribonucleotide reductase (RNR), in a first-in-human Phase 1/2 clinical trial in patients with oncogene amplified cancers. We refer to this trial as POTENTIATE (Precision Oncology Trial Evaluating Novel Therapeutic Interrupting Amplifications Tied to ecDNA).

We opened the BBI-355/BBI-825 combination arm of the POTENTIATE trial for enrollment in the third quarter of 2025. We expect to deliver initial proof-of-concept clinical data within our existing cash runway timeline discussed below.

Our next program targets a kinesin ("Kinesin") involved in DNA segregation, including ecDNA segregation, during mitosis. To our knowledge, there have been no prior drug efforts directed against Kinesin. We have discovered orally bioavailable, highly selective Kinesin degraders that have demonstrated potent anti-tumor activity in a range of cancer cell lines, as well as single agent tumor regressions in mouse xenograft cancer models. We selected BBI-940 as the development candidate for our novel Kinesin program and we expect to submit an investigational new drug application (IND) to the FDA and initiate the first in-human clinical trial for BBI-940 in the first half of 2026. We also expect to deliver initial proof-of-concept clinical data on BBI-940 within our existing cash runway timeline discussed below.

To assist in identifying patients that may benefit from our ecDTx, we have developed an ecDNA diagnostic, which we internally call ECHO (ecDNA Harboring Oncogenes), to detect ecDNA in patient tumor samples. This test analyzes the genomic data obtained from routine next-generation sequencing (NGS) of patient tumor samples. ECHO is currently being used as a clinical trial assay to determine ecDNA status of patients enrolled in the POTENTIATE trial discussed below.

Other Developments

In May 2025, we announced that we discontinued the then-current monotherapy arm and combination arms of BBI-355 with third-party targeted therapies in the POTENTIATE trial based on initial trial data. We are winding down those initial arms of the trial. We also announced a portfolio prioritization focused on evaluating BBI-355 in combination with BBI-825 in the POTENTIATE trial as discussed above, advancing our Kinesin program with the announcement of development candidate BBI-940, and streamlining operations, including a reduction of our workforce, to extend our expected cash runway through proof-of-concept readouts for each of those programs. The workforce reduction was completed as of September 30, 2025, and related charges were recognized in our results of operations for the nine months ended September 30, 2025.

In December 2024, following an assessment of preliminary pharmacokinetic data from Part 1 of the trial, we announced our decision not to continue dose escalation of Part 1 or to proceed into the Part 2 portion of our clinical trial of BBI-825 which was a first-in-human Phase 1/2 clinical trial in patients with solid tumors called STARMAP (Study Treating Acquired Resistance: MAPK Amplifications). During 2025, we have been winding down the STARMAP trial.

Business Overview

Since we commenced operations in 2018, we have devoted substantially all of our efforts and resources to organizing and staffing our company, business planning, raising capital, building our proprietary Spyglass platform, discovering our ecDTx, developing our ecDNA diagnostic, establishing our intellectual property portfolio, conducting research, preclinical studies, and clinical trials, establishing arrangements with third parties for the manufacture of our ecDTx and related raw materials, and providing general and administrative support for these operations. During this time, we have incurred significant operating losses and, as of September 30, 2025, we had an accumulated deficit of $246.8 million. We expect to continue to incur losses for the foreseeable future, and anticipate these losses will increase substantially as we continue our development of, seek regulatory approval for, and potentially commercialize any of our ecDTx, seek to discover and develop additional ecDTx, develop our ecDNA diagnostic, conduct our ongoing and planned clinical trials and preclinical studies, continue our research and development activities, utilize third parties to manufacture our ecDTx and related raw materials, seek to expand and protect our intellectual property, as well as incur additional costs associated with being a public company. If we obtain regulatory approval for any of our ecDTx, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing, and distribution. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical trials, preclinical studies, and our other research and development activities and capital expenditures.

Through September 30, 2025, we have raised a total of $353.8 million to fund our operations primarily from the gross proceeds from the sale and issuance of our convertible preferred and common stock. In April 2024, we completed our initial public offering, or IPO, in which we sold and issued 6,250,000 shares of our common stock for gross proceeds of $100.0 million. In April 2025, we commenced an "at the market" (ATM) offering as defined in Rule 415(a)(4) under the Securities Act, under which we may offer and sell shares of our common stock having an aggregate offering price of up to $14.5 million from time to time through or to our sales agent, as described further under "Liquidity and Capital Resources" below. As of September 30, 2025, we had cash, cash equivalents, and short-term investments of $117.6 million.

Based on our current operating plans, we believe that our existing cash, cash equivalents, and short-term investments will be sufficient to fund our operations into the first half of 2028. We have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we expect. See "Liquidity and Capital Resources" below for more information.

We do not have any products approved for sale and have not generated any revenue to date. We do not expect to generate any revenue from product sales until we successfully complete development and obtain regulatory approval for one or more of our ecDTx, which we expect will take several years and may never occur. We will need substantial additional funding to support our continuing operations and pursue our long-term business plan, including to complete the development and commercialization of our ecDTx, if approved. Accordingly, until such time as we can generate significant revenue from sales of our ecDTx, if ever, we expect to finance our cash needs through equity offerings, debt financings, or other capital sources, including potential collaborations, licenses, and other similar arrangements. However, we may be unable to raise additional funds or enter such other arrangements when needed on favorable terms or at all. Our failure to raise capital or enter such other arrangements when needed would have a negative impact on our financial condition and could force us to delay, limit, reduce, or terminate our research and development programs or other operations, or grant rights to develop and market ecDTx that we would otherwise prefer to develop and market ourselves.

We do not own or operate, and currently have no plans to establish, any manufacturing facilities. We rely, and expect to continue to rely, on third parties for the manufacture of our ecDTx, for preclinical and clinical testing, as well as for commercial manufacture if any of our ecDTx obtain marketing approval. We are working with our current manufacturers to ensure that we will be able to scale up our manufacturing capabilities to support our clinical plans. In addition, we rely on third parties to package, label, ship, store, and

distribute our ecDTx, and we intend to rely on third parties for our commercial products if marketing approval is obtained. We believe that this strategy allows us to maintain a more efficient infrastructure by eliminating the need for us to invest in our own manufacturing facilities, equipment, and personnel while also enabling us to focus our expertise and resources on the discovery and development of our ecDTx.

Macroeconomic, Political, and Regulatory Environment Considerations

Uncertainty in the United States and global macroeconomic, political, and regulatory environments present significant risks to our business. Our operating costs, ability to raise additional capital, and stock price could be materially and adversely affected by macroeconomic and geopolitical events and conditions outside of our control, including market volatility, high interest rates, inflation, tariffs and other trade barriers, retaliatory measures taken by foreign countries, slowed economic growth or recession, uncertainty with respect to the federal budget and debt ceiling, potential or prolonged government shutdowns related thereto, liquidity concerns at financial institutions, supply chain disruptions, military conflicts, and other geopolitical events and instability. Further, one or more of our current service providers or vendors, manufacturers, clinical investigative sites, financial institutions, and other partners may be adversely affected by the foregoing risks, which could directly affect our ability to attain our operating goals on schedule and on budget.

In addition, FDA-regulated industries, such as ours, face uncertainty with regard to the regulatory environment we will face as we proceed with research and development and possibly in the future commercialization. Recent initiatives of the current U.S. presidential administration have resulted in significant voluntary and involuntary FDA staff departures and could impact the FDA's ability to retain key personnel and hire additional personnel, which may result in delays or limitations on our ability to obtain guidance from agency staff and slow review times for applications we submit to obtain the requisite regulatory approvals in the future. Moreover, the current presidential administration has taken and may take additional future actions to freeze or reduce federal funding for medical research, which could decrease the ability of facilities that rely on such funding to conduct clinical trials or increase the costs to us of conducting clinical trials at those facilities. There remains general uncertainty regarding future activities. New executive orders, regulations, policies, or guidance could be issued or promulgated that adversely affect us or create a more challenging or costly environment to pursue the development and commercialization of our ecDTx, including in areas relating to regulatory framework and oversight, research and development funding, drug pricing reform, intellectual property rights, global trade policy, and tariffs. In addition, the U.S. federal government shutdown that began in October 2025 could impact the ability of the FDA to timely review and process our regulatory submissions, which could, among other things, potentially delay initiation of our clinical trial of BBI-940.

Although, to date, our business has not been materially impacted, the ultimate impact of global economic and market conditions and changes in government agencies, regulations and policies remains highly uncertain and will depend on future developments and factors that continue to evolve. We closely monitor these ongoing developments and the potential impact of these factors on our business, operating expenses, and cash position and, if circumstances warrant, we may make adjustments to our operating plan. For more information regarding these risks and uncertainties, see Item 1A, "Risk Factors," in Part I of our 2024 10-K and in Part II of this Quarterly Report on Form 10-Q.

Components of Our Results of Operations

Revenue

To date, we have not generated any revenue from the sale of products. We do not expect to generate any such revenue unless and until such time that our ecDTx have advanced through clinical development and regulatory approval, if ever. If we fail to complete preclinical and clinical development of ecDTx or obtain regulatory approval for them, our ability to generate future revenues, and our results of operations and financial position would be adversely affected.

Operating Expenses

Our operating expenses consist of research and development expenses and general and administrative expenses.

Research and Development

Our research and development (R&D) expenses have related primarily to building our Spyglass platform, our ecDTx discovery efforts, our preclinical and clinical development activities, and the development of an ecDNA diagnostic test. R&D expenses are recognized as incurred, and payments made prior to the receipt of goods or services to be used in R&D are capitalized until the goods or services are received. We use internal resources primarily to conduct our research and discovery activities, as well as for managing our preclinical development, process development, manufacturing, and clinical development activities. We track direct costs on a development program specific basis. Certain shared costs are allocated ratably between BBI-355 and BBI-825. Indirect costs are not included in program costs, as these costs are general in nature and benefit all our discovery efforts and development programs.

Our direct, or development program specific, R&D costs consist of:

Our indirect R&D costs include:

Although R&D activities are central to our business model, the successful development of our ecDTx is highly uncertain. There are numerous factors associated with the successful development of any ecDTx, including future trial design and various regulatory requirements, many of which cannot be determined with accuracy at this time based on our stage of development. In addition, future regulatory factors beyond our control may impact our clinical development programs. Product candidates in later stages of development generally have higher development costs than those in earlier stages of development. As a result, we expect that our R&D expenses will increase substantially for the foreseeable future as we continue to conduct our ongoing R&D activities, advance preclinical research programs toward clinical development, conduct clinical trials, and maintain, expand, protect, and enforce our intellectual property portfolio.

Our future R&D expenses may vary significantly based on a wide variety of factors such as:

A change in the outcome of any of these variables with respect to development of any of our ecDTx could significantly change the costs and timing associated with the development of that ecDTx.

The process of conducting the necessary preclinical and clinical research to obtain regulatory approval is costly and time-consuming. The actual probability of success for our current ecDTx or any future ecDTx may be affected by a variety of factors. We may never succeed in achieving regulatory approval for any of our ecDTx. Preclinical and clinical development timelines, the probability of success, and total development costs can differ materially from expectations. As we have done in recent months, we anticipate that

we will continue to make determinations as to which ecDTx to pursue and how much funding to direct to each ecDTx on an ongoing basis in response to the results of ongoing and future preclinical studies and clinical trials, regulatory developments, and our ongoing assessments as to each ecDTx's commercial potential. We will need to raise substantial additional capital in the future. In addition, we cannot forecast which ecDTx may be subject to future collaborations, when such arrangements will be secured, if at all, and to what degree such arrangements would affect our development plans and capital requirements.

General and Administrative

General and administrative (G&A) expenses consist primarily of personnel-related costs, including salaries, bonuses, benefits, travel, and stock-based compensation expenses for employees in executive, accounting and finance, business development, legal, and other administrative functions. Other significant costs include allocated facility-related costs, legal fees relating to intellectual property and corporate matters, professional fees for accounting and consulting services, insurance costs, and business development expenses.

We expect that our G&A expenses will increase substantially in the future as we grow our business and, if any ecDTx receive marketing approval, when we commence commercialization activities. We expect to continue to incur increased facilities-related costs related to our current headquarters facilities. We also expect to continue to incur expenses related to audit, legal, regulatory, and tax-related services associated with maintaining compliance with securities exchange listing and SEC requirements, director and officer insurance premiums, and investor relations costs associated with operating as a public company.

Other Income, Net

Other income, net consists primarily of interest income earned on our cash, cash equivalents, and investments.

Results of Operations

Comparison of the Three Months Ended September 30, 2025 and 2024

The following table summarizes our results of operations for each of the periods indicated (in thousands):

Research and Development Expenses

The following table summarizes our R&D expenses for each of the periods indicated (in thousands):

R&D expenses were $10.7 million and $14.1 million for the three months ended September 30, 2025 and 2024, respectively. The $3.4 million decrease was primarily attributable to (i) a $2.0 million decrease in direct program costs, driven by reduced spending on the STARMAP trial of BBI-825, partially offset by increased investment in our other development programs, primarily BBI-940, (ii) a $2.0 million decrease in personnel-related costs primarily due to the reduction in headcount discussed above, (iii) a $0.3 million decrease in outside services and consulting costs, and (iv) a $0.3 million decrease in laboratory and pharmacology supply costs due to lower material needs in certain early-stage development programs. These decreases were partially offset by a $1.3 million increase in facilities-related expenses, due to commencement of the lease for our corporate headquarters in the fourth quarter of 2024.

General and Administrative Expenses

G&A expenses were $4.5 million and $4.6 million for the three months ended September 30, 2025 and 2024, respectively. The $0.2 million decrease in G&A expenses was primarily driven by a $0.7 million decrease in personnel-related costs (including stock-based compensation expense of $0.3 million), resulting primarily from the reduction in headcount discussed above, and a $0.2 million decrease in other G&A costs, which were partially offset by a $0.8 million increase in facilities-related costs due to commencement of the lease for our corporate headquarters in the fourth quarter of 2024.

Other Income, Net

Other income, net was $1.3 million and $2.2 million for the three months ended September 30, 2025 and 2024, respectively. The $0.9 million decrease resulted from a reduction in the interest income generated by our available-for-sale investment securities portfolio due to the decrease in the amount of cash equivalents available for investing purposes as well as the decline in the market yields available for such investment securities compared to the prior year period.

Comparison of the Nine Months Ended September 30, 2025 and 2024

The following table summarizes our results of operations for each of the periods indicated (in thousands):

Research and Development Expenses

The following table summarizes our R&D expenses for each of the periods indicated (in thousands):

R&D expenses were $35.0 million and $42.0 million for the nine months ended September 30, 2025 and 2024, respectively. The $6.9 million decrease was primarily attributable to (i) a $4.7 million decrease in direct program costs, driven by reduced spending on the STARMAP trial of BBI-825, partially offset by increased investment in the Phase 1/2 POTENTIATE trial, including the ongoing arm evaluating BBI-355 in combination with BBI-825, and other development programs, primarily BBI-940, (ii) a $2.7 million decrease in personnel-related costs primarily due to the reduction in headcount discussed above, (iii) a $2.4 million decrease in outside services and consulting costs, and (iv) a $1.1 million decrease in laboratory and pharmacology supply costs due to lower material needs in certain early-stage development programs. These decreases were partially offset by a $4.0 million increase in facilities-related expenses, primarily due to commencement of the lease related to our corporate headquarters in the fourth quarter of 2024.

General and Administrative Expenses

G&A expenses were $14.5 million and $13.0 million for the nine months ended September 30, 2025 and 2024, respectively. The $1.5 million increase in G&A expenses was primarily attributable to (i) a $1.6 million increase in facilities-related costs primarily due to commencement of the lease related to our corporate headquarters in the fourth quarter of 2024, and (ii) a $0.3 million increase in professional service fees primarily for legal and accounting services related to our shelf registration statement on Form S-3 and "at the market" (ATM) offering program. These increases were partially offset by a $0.4 million decrease in personnel-related costs primarily due to the reduction in force discussed above.

Other Income, Net

Other income, net was $4.2 million and $6.1 million for the nine months ended September 30, 2025 and 2024, respectively. The $1.9 million decrease resulted from a reduction in interest income generated by our available-for-sale investment securities portfolio due to the decrease in the amount of cash equivalents available for investing purposes as well as the decline in the market yields available for such investment securities compared to the prior year period.

Liquidity and Capital Resources

Sources of Liquidity

Through September 30, 2025, we have raised a total of $353.8 million to fund our operations primarily from the gross proceeds from the sale and issuance of shares of our convertible preferred stock prior to our IPO and the sale and issuance of 6,250,000 shares of our common stock in our IPO, which closed in April 2024. Our IPO generated gross proceeds of $100.0 million, which resulted in net proceeds to us of approximately $87.7 million, after deducting underwriting discounts and commissions and other offering expenses.

In April 2025, we entered into an Open Market Sale AgreementSM(the Sales Agreement) with Jefferies LLC (the Agent) under which we may, from time to time, sell shares of our common stock in ATM offerings through or to the Agent, as sales agent or principal. See Note 1 to our unaudited condensed financial statements included elsewhere in this Quarterly Report on Form 10-Q under the section entitled "ATM Offering" for further information. We are not obligated to sell, and the Agent is not obligated to buy or sell, any shares of our common stock under the Sales Agreement. No assurance can be given that we will sell any shares of our common stock under the Sales Agreement, or, if we do, as to the price or amount of shares of common stock that are sold or the dates when such sales will take place. As of the date of this report, no shares have been sold under the Sales Agreement.

Future Funding Requirements

As of September 30, 2025, we had cash, cash equivalents, and short-term investments of $117.6 million. Based upon our current operating plans, we believe that our existing cash, cash equivalents, and short-term investments will be sufficient to fund our operations into the first half of 2028. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. We have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we expect. Additionally, the process of conducting preclinical studies, manufacturing ecDTx, developing our ecDNA diagnostic, and testing ecDTx in clinical trials is costly, and the timing of progress and expenses in these studies and trials is uncertain.

We have incurred significant operating losses since our inception and, as of September 30, 2025, we had an accumulated deficit of $246.8 million. We expect to continue to incur losses for the foreseeable future, and we anticipate these losses will increase substantially as we continue our development of, seek regulatory approval for, and potentially commercialize any of our ecDTx, seek to discover and develop additional ecDTx, develop our ecDNA diagnostic, conduct our ongoing and planned clinical trials and preclinical studies, continue our research and development activities, utilize third parties to manufacture our ecDTx and related raw materials, seek to expand and protect our intellectual property, as well as incur additional costs associated with being a public company. We also have substantial payment obligations under a long-term non-cancellable facility lease, as discussed below. If we obtain regulatory approval for any of our ecDTx, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing, and distribution. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical trials, preclinical studies, and our other research and development activities and capital expenditures.

Our future capital requirements are difficult to predict and depend on many factors, including but not limited to:

We have no committed sources of capital. Until we can generate sufficient product revenue to finance our cash requirements, if ever, we expect to finance our future cash needs primarily through equity offerings (including through the Sales Agreement), debt financings, or other capital sources, including potential collaborations, licenses, and other similar arrangements. However, we may be unable to raise additional funds or enter such other arrangements when needed on favorable terms or at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders will be or could be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends. If we raise additional funds through other collaborations or licensing arrangements with third parties, we may have to relinquish valuable rights to our future revenue streams, ecDTx, research programs, intellectual property or proprietary technology, or grant licenses on terms that may not be favorable to us. Our ability to raise additional funds may be adversely impacted by global economic conditions, disruptions to, and volatility in, the credit and financial markets in the United States, inflation, diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, and uncertainty about economic stability. If we are unable to raise additional funds through equity or debt financings or other arrangements when needed, we may be required to delay, limit, reduce, or terminate our R&D programs or other operations, or grant rights to develop and market ecDTx to third parties that we would otherwise prefer to develop and market ourselves, or on less favorable terms than we would otherwise choose.

Cash Flows

The following table summarizes our cash flows for each of the periods indicated (in thousands):

Operating Activities

Net cash used in operating activities was $36.6 million and $45.3 million for the nine months ended September 30, 2025 and 2024, respectively. The net cash used in operating activities during the nine months ended September 30, 2025 was primarily due to our reported net loss of $45.3 million, net of noncash charges (including stock-based compensation expense, depreciation, and right-of-use

asset amortization) totaling $6.1 million and a $2.6 million decrease of our net operating assets. The net cash used in operating activities during the nine months ended September 30, 2024 was primarily due to our reported net loss of $48.9 million, net of noncash charges (including stock-based compensation expense, depreciation, and right-of-use asset amortization) totaling $4.2 million and a $0.5 million increase of our net operating assets. The decrease in cash used in operations during the nine months ended September 30, 2025 in comparison to the nine months ended September 30, 2024 was primarily attributable a decrease in third-party spending associated with our discovery, development, and clinical activities.

Investing Activities

Investing activities consist primarily of the cash flows of purchases and maturities of investment securities and the cash outflow associated with purchases of property and equipment. Such activities resulted in a net inflow of funds of approximately $24.8 million during the nine months ended September 30, 2025, primarily from the net maturities of our available-for-sale securities portfolio, and a net outflow of funds of approximately $27.9 million during the nine months ended September 30, 2024, primarily from the net purchases of our available-for-sale securities portfolio.

Financing Activities

Our financing activities relate to the offering and sale of shares of our common stock in our IPO and under our 2024 Employee Stock Purchase Plan (ESPP), and the exercise of common stock options by our employees and consultants. Net cash provided by financing activities was $0.1 million during the nine months ended September 30, 2025, representing net proceeds from the sale of shares of our common stock under our ESPP. Net cash provided by financing activities was $89.7 million during the nine months ended September 30, 2024, primarily due to the net proceeds from our IPO.

Contractual Obligations and Other Commitments

We lease office and lab space under a non-cancellable lease agreement that commenced in November 2024 and expires in October 2034. As of September 30, 2025, future minimum lease payment obligations under this lease agreement totaled $71.6 million, which is exclusive of future variable lease payments for our allocated share of utilities, property taxes, common area maintenance and amenities costs, and other variable expenses associated with operation and management of the property. Due to an abatement period, base rent payments under this lease did not commence until July 2025. Accordingly, our total minimum lease payments for future years under the lease agreement will be substantially greater than our total lease payments for the year ending December 31, 2025. See Note 7 to our unaudited condensed financial statements included elsewhere in this Quarterly Report on Form 10-Q for further information.

We enter into contracts in the normal course of our business for clinical trial and preclinical research services, contract manufacturing services, professional services and other services and products for research and operating purposes. These contracts generally provide for termination after a notice period, and, therefore, are cancelable contracts and not separately presented.

Off-Balance Sheet Arrangements

Since our inception, we have not had, and we do not currently have, any off-balance sheet arrangements as defined under rules and regulations of the SEC.

Critical Accounting Policies and Significant Estimates and Judgments

Our management's discussion and analysis of our financial condition and results of operations are based on our unaudited condensed financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, 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 R&D expenses and stock-based compensation expense. We base our estimates on 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.

There have been no material changes to our critical accounting policies and estimates from those described in "Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Significant Estimates and Judgments" included in our 2024 10-K.

Emerging Growth Company and Smaller Reporting Company Status

As an emerging growth company under the Jumpstart Our Business Startups Act of 2012 (the JOBS Act), we can take advantage of an extended transition period for complying with new or revised accounting standards. This period allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this exemption from new or revised accounting standards and, therefore, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates. We also intend to rely on other exemptions provided by the JOBS Act, including without limitation, not being required to comply with the auditor attestation requirements of Section 404(b) of Sarbanes-Oxley for so long as we are exempt from doing so.

We will remain an emerging growth company until the earliest of (i) December 31, 2029, which is the last day of the fiscal year following the fifth anniversary of the consummation of our IPO; (ii) the last day of the fiscal year in which we have total annual gross revenue of at least $1.235 billion; (iii) the last day of the fiscal year in which we are deemed to be a "large accelerated filer" as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock held by non-affiliates exceeded $700.0 million as of the last business day of the second fiscal quarter of such year; or (iv) the date on which we have issued more than $1.0 billion in nonconvertible debt securities during the prior three-year period.

We are also a smaller reporting company as defined in Rule 12b-2 under the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as our voting and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and our voting and non-voting common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter.