The following discussion and analysis is meant to provide material information relevant to an assessment of the financial condition and results of operations of our company, including an evaluation of the amount and certainty of cash flows from operations and from outside sources, so as to allow investors to better view our company from management’s perspective. You should read the following discussion and analysis of financial condition and results of operations together with our unaudited condensed consolidated financial statements and the related notes appearing elsewhere in this Quarterly Report on Form 10-Q and the consolidated financial statements and the related notes and discussion and analysis of financial condition and results of operations in our Annual Report on Form 10-K for the year ended December 31, 2025 filed on February 24, 2026. This discussion contains forward-looking statements that involve risks and uncertainties. As a result of many factors, such as those set forth in the section titled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, filed on February 24, 2026 and elsewhere in this Quarterly Report on Form 10-Q, our actual results may differ materially from those anticipated in or implied by these forward-looking statements.
Business Overview
Our Business
We are a biotechnology company dedicated to improving the lives of patients suffering from debilitating and life-threatening diseases. Through our PROteolysis TArgeting Chimera, or PROTAC, protein degradation platform, we are pioneering the development of a new class of therapeutics designed to harness the body’s own natural protein disposal system to selectively and efficiently degrade and remove disease-causing proteins. We believe that our targeted protein degradation approach is a novel therapeutic modality that may provide distinct advantages over existing therapies and address a broad range of targets, including historically undruggable proteins, in areas of significant unmet need.
In the past five years, seven of the programs developed using our PROTAC protein degradation platform have progressed to clinical trials in oncology and neurology indications after demonstrating potent and selective protein degradation in our preclinical studies. We believe favorable clinical trial results in our ongoing oncology and neurology programs would further validate our platform as a new therapeutic modality for the potential treatment of diseases caused by dysregulated intracellular proteins.
In the second quarter of 2026, the U.S. Food and Drug Administration, or FDA, approved VEPPANU™ (vepdegestrant) for the treatment of adults with estrogen receptor-positive, or ER+,/human epidermal growth factor receptor 2-negative, or HER2-, estrogen receptor 1, or ESR1, -mutated advanced or metastatic breast cancer, as detected by an FDA-authorized test, with disease progression following at least one line of endocrine-based therapy. VEPPANU is the first and only FDA-approved PROTAC protein degrader, a type of heterobifunctional protein degrader therapy.
Also in the second quarter of 2026, we and Pfizer Inc., or Pfizer, entered into a license agreement with Rigel Pharmaceuticals, Inc., or Rigel, for the exclusive global development, manufacturing, and commercialization rights for VEPPANU, or the Rigel License Agreement. Under the terms of the Rigel License Agreement, Rigel is responsible for the launch and commercialization of VEPPANU in the U.S. and owns global rights with the ability to sublicense to potential partners to further develop and commercialize VEPPANU outside of the U.S. We and Pfizer are entitled to a percentage of sublicensing revenue generated outside the U.S. Rigel has agreed to reimburse us and Pfizer up to $40.0 million of the costs of ongoing development activities that were in progress as of the effective date of the Rigel License Agreement. While Pfizer is responsible for these ongoing development activities, we and Pfizer will share equally in this reimbursement and therefore we will reimburse Pfizer for 50% of the costs of such activities.
Pursuant to the terms of the Rigel License Agreement, Rigel paid to us and Pfizer a one-time, upfront payment in the aggregate amount of $70.0 million. In addition, we and Pfizer will receive an additional upfront payment in the amount of $15.0 million upon successful completion of select development and manufacturing transition activities. We and Pfizer are also eligible to receive up to an additional $320.0 million as contingent payments based on future development, regulatory and commercial milestones being met, as well as tiered royalties in the mid-teens to mid-20s based upon worldwide net sales of VEPPANU, subject to reduction under
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certain circumstances as provided in the Rigel License Agreement. All payments under the Rigel License Agreement will be shared equally between us and Pfizer. In connection with and to facilitate entry into the Rigel License Agreement, in the second quarter of 2026, we and Pfizer also entered into a letter agreement supplementing and amending the terms of the Original Vepdegestrant (ARV-471) Collaboration Agreement, or the Pfizer Letter Agreement, which was accounted for as a contract modification. Pursuant to the terms of the Pfizer Letter Agreement, until any termination of the Rigel License Agreement, the milestones and royalty payments under the Rigel License Agreement replace any unearned future amounts that may be owed by Pfizer to us under the Original Vepdegestrant (ARV-471) Collaboration Agreement.
Our pipeline, which includes an overview of our clinical and preclinical programs, as well as out-licensed programs, is summarized below.
*The agents, other than VEPPANU which has been approved by the FDA, in the pipeline graphic above are currently under investigation; their safety and effectiveness for these investigational uses have not been established.
**Upon health authority clearance to proceed with clinical trials.
•Defined terms used in pipeline graphic: AR, androgen receptor; BCL6, B-cell lymphoma 6; ER+, estrogen receptor positive; ESR1, estrogen receptor 1; DLBCL, diffuse large b-cell lymphoma; HER2-, human epidermal growth factor receptor 2-negative; HPK1, hematopoietic progenitor kinase 1; HV: healthy volunteers; I-O, immuno-oncology; KRAS, Kirsten rat sarcoma viral oncogene homolog; LRRK2, leucine-rich repeat kinase 2; mCRPC, metastatic castration resistant prostate cancer; mHSPC, metastatic hormone sensitive prostate cancer; NSCLC, non-small cell lung cancer; NDA, new drug application; NHL, non-Hodgkin lymphoma; polyQ, expanded polyglutamine; PSP, progressive supranuclear palsy; SBMA, spinal-bulbar muscular atrophy.
•Footnotes included in pipeline graphic: 1. Includes relapsed/refractory angioimmunoblastic T-cell lymphoma (AITL) and relapsed/refractory mature B cell NHL; 2. Phase 1/2 combination trials with palbociclib, atirmociclib, abemaciclib, ribociclib, samuraciclib, everolimus.
In addition to the programs above and any early-stage collaborations, including with Pfizer, we are conducting exploratory research and development work on multiple other undisclosed targets.
Clinical Stage Programs: ARV-393, ARV-102, ARV-027 and ARV-806
ARV-393: Oral PROTAC BCL6 Degrader Program
ARV-393 is an investigational, orally bioavailable PROTAC designed to specifically target and degrade BCL6, a transcriptional repressor and a key regulator of normal B-cell maturation and differentiation processes. Deregulation of BCL6 function (e.g., via chromosomal translocation, mutations) may lead to malignant transformation and development of NHL. Also as a lineage defining transcription factor of T-follicular helper
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cells, BCL6 has been implicated in nodal T-follicular helper cell lymphoma, or nTFHL, including the angioimmunoblastic type, formerly angioimmunoblastic T-cell lymphoma, or AITL.
We believe that PROTAC-mediated degradation has the potential to address the historically undruggable nature of BCL6 and that ARV-393 PROTAC-mediated degradation of BCL6 may provide an important novel therapeutic option for patients with NHL. Furthermore, we believe current preclinical data suggest that ARV-393 has the potential to be an attractive combination partner for development of novel therapies for lymphoma, including chemo-free combination regimens and/or “all oral” treatment options.
Preclinical Development
We have conducted preclinical studies of ARV-393 alone, in combination with SOC chemotherapy and biologic agents, as well as oral, investigational small molecule inhibitors in high grade and aggressive diffuse large B-cell lymphoma, or DLBCL, and in combination with glofitamab, a CD20xCD3 bispecific antibody and an emerging SOC option for DLBCL, in models of aggressive high grade DLBCL. We believe the totality of our ARV-393 preclinical data provides a compelling rationale to evaluate ARV-393 in combination with bi-specifics, oral pathway inhibitors, and potentially other SOCs in the larger DLBCL indication.
Clinical Development
We initiated the monotherapy cohort of our first-in-human Phase 1 clinical trial of ARV-393 in patients with relapsed or refractory NHL in the second quarter of 2024 and are currently recruiting patients for this clinical trial. This is an open-label, multicenter, Phase 1 dose escalation trial to evaluate the safety, tolerability PK, pharmacodynamics, and preliminary anti-tumor activity of ARV-393 as a single agent in adult patients with relapsed/refractory NHL. We announced in the first quarter of 2026, and have since reiterated that there have been multiple responses observed in early cohorts at doses below the predicted effective exposure level in patients with both B- and T-cell lymphomas in the first-in-human Phase 1 clinical trial. We believe these early data support an emerging, and differentiated, therapeutic benefit of ARV-393. Dose escalation in the trial is ongoing and the safety profile of ARV-393 supports continuing dose escalation. We plan to share clinical data from the early monotherapy cohorts in the ongoing Phase 1 dose escalation clinical trial of ARV-393 in patients with relapsed/refractory NHL at a medical congress in the second half of 2026. We expect that the majority of this data in 2026 will be from the early cohorts dosed below the expected efficacious range. These early monotherapy cohorts, when compared with the overall lymphoma population, include a higher-than-predicted proportion of patients with T-cell lymphomas, which we believe reflects the limited treatment options for these patients. However, as we’ve approached the predicted efficacious range, enrollment of patients, including those with B-cell lymphomas, has increased. We anticipate sharing additional monotherapy data in the ongoing Phase 1 dose escalation clinical trial in patients with B- and T-cell lymphomas in mid-2027.
In addition, in the second quarter of 2026, we announced the initiation of a combination cohort in the ongoing Phase 1 clinical trial to evaluate ARV-393 in combination with glofitamab as a chemotherapy-free combination approach in patients with DLBCL. Enrollment in this clinical trial is currently ongoing, and we plan to share data from this combination cohort of ARV-393 with glofitamab in patients with DLBCL in mid-2027.
ARV-102: Oral PROTAC LRRK2 Degrader Program
ARV-102 is an investigational, orally bioavailable PROTAC designed to cross the blood-brain barrier and specifically target and degrade LRRK2, which is a large, multi-domain scaffolding kinase with GTPase activity. ARV-102 is our first oral PROTAC protein degrader in clinical development to treat neurodegenerative diseases.
Traditional small molecule inhibitors, or SMIs, only block LRRK2’s kinase activity, and thus only modify disease processes regulated by the LRRK2 kinase. By degrading the entire protein, LRRK2 degraders are designed to eliminate all of the ways LRRK2 interacts with disease pathology: the scaffolding function, GTPase activity, as well as kinase activity. We believe our LRRK2 degraders are particularly well positioned to be evaluated in neurodegenerative diseases where there are currently no disease modifying therapies available, including:
•PSP, where genetic variations in LRRK2 are associated with PSP progression and accelerated time to death. PSP is a primary tau-driven disease, and tau uptake by human neurons requires LRRK2
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activity. Additionally, we have published data associating the tau pathology of PSP with LRRK2-mediated endolysosomal dysfunction; and
•PD, where increased LRRK2 expression and activity, as well as specific LRRK2 mutations, contributes to neurodegeneration and pathogenesis of PD.
Preclinical Development
In preclinical studies, ARV-102 was shown to cross the blood-brain barrier and degrade LRRK2 in cerebrospinal fluid, or CSF, in non-human primates, or NHPs. Our preclinical studies also showed that ARV-102 and other similar LRRK2 PROTAC degrader molecules pharmacologically enhanced lysosomal degradative capacity and number, and reduced pathologic forms of tau in vitro and in vivo. We believe the data from our preclinical studies of ARV-102 further support the potential of PROTAC-induced LRRK2 degradation as a treatment for patients with neurodegenerative diseases.
Clinical Development
We have evaluated ARV-102 in Phase 1 clinical trials in healthy volunteers and patients with PD.
•Healthy Volunteers: We initiated the first-in-human Phase 1 clinical trial for ARV-102 in the first quarter of 2024. We completed the single ascending dose, or SAD, and multiple ascending dose, or MAD, cohorts of the ARV-102 Phase 1 clinical trial in healthy volunteers.
•Patients with PD: We completed enrollment in the SAD cohort of the ARV-102 Phase 1 clinical trial in patients with PD in the second quarter of 2025. We received Clinical Trial Application approval in the Netherlands to initiate a multiple dose cohort of the Phase 1 clinical trial in patients with PD in the second quarter of 2025, and we initiated this multiple dose, or MD, cohort in the third quarter of 2025. In the fourth quarter of 2025, we completed enrollment in the multiple dose cohort.
The ARV-102 Phase 1 clinical trial was designed to assess the safety, pharmacokinetics, and pharmacodynamics of orally administered ARV-102 in patients with Parkinson's disease.
In the first quarter of 2026, we presented data from the single-center, randomized, double-blind, placebo-controlled, multiple dose, or MD, cohort of the Phase 1 clinical trial in patients with Parkinson's disease in an oral presentation at the 2026 International Conference on Alzheimer’s and Parkinson’s Diseases and Related Neurological Disorders 2026 in Copenhagen, Denmark. In the MD cohort, patients were randomized to either placebo or multiple oral doses of ARV-102 (20 mg, 40 mg, or 80 mg) for 28 days with follow-up at day 42.
Data presented from the clinical trial included the following:
Safety Profile
•Multiple oral doses of ARV-102 (20 mg, 40 mg, or 80 mg once daily for 28 days) were well tolerated in participants with Parkinson's disease.
•All treatment-emergent adverse events and treatment-related adverse events were mild in severity, with no serious adverse events, discontinuations, or deaths reported.
•No significant changes in lung functions or respiratory symptoms were observed during the 28 days of treatment or during follow-up.
Pharmacokinetic and Pharmacodynamic Evaluation
•ARV-102 levels in CSF increased in a dose-dependent manner after multiple doses, indicating brain penetration.
•The area under the concentration-time curve (AUC0-24) and the maximum plasma concentration (Cmax) after daily dosing increased with dose with a mean terminal plasma half-life (t1/2) of 68 hours.
•ARV-102 achieved peripheral LRRK2 degradation and dose-dependent degradation of LRRK2 in CSF, with approximately 50% or greater degradation observed at all doses by day 14 and maintained through day 28.
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•Endolysosomal and neuroinflammatory pathway proteins that are elevated in LRRK2-related Parkinson's disease (e.g., CD68, GPNMB) were reduced with ARV-102.
•Pharmacology and changes in peripheral biomarkers in patients with Parkinson's disease were consistent with observations in healthy volunteers dosed with ARV-102.
Based on the data, we plan to continue investigation of ARV-102 in neurodegenerative diseases associated with LRRK2 and endolysosomal dysfunction. We plan to share additional biomarker data from the Phase 1 clinical trial in patients with PD at the International Congress on Parkinson’s Disease and Movement Disorders in the fourth quarter of 2026.
We submitted an investigational new drug application, or IND, earlier this year for ARV-102 with the intention of initiating a Phase 1b clinical trial in patients with PSP in the U.S. during first half of 2026. Following the 30-day review period, prior to authorizing the initiation of the Phase 1b clinical trial in the U.S. in patients with PSP, the FDA requested additional information as well as final data from our chronic toxicology studies in non-human primates, which we recently completed. As a result of the FDA’s request, the planned Phase 1b clinical trial, in which we have not yet dosed any patients, is on clinical hold and will not begin until the FDA completes its review and authorizes initiation of the clinical trial. In addition, during the second quarter of 2026, we engaged with European and Japanese health authorities on our ARV-102 program in patients with PSP. Our discussions with global health authorities are ongoing. We plan to continue these discussions and, subject to regulatory clearance, we plan to initiate clinical trials in patients with PSP in 2027. We continue to evaluate development options for ARV-102 in PD.
In addition, in the second quarter of 2026, we announced that we joined the LRRK2 Investigative Therapeutics Exchange (LITE) program and the Parkinson’s Precision Medicine Initiative (PPMI), both supported by The Michael J. Fox Foundation for Parkinson’s Research (MJFF).
ARV-027: Oral PROTAC polyQ-AR Degrader Program
ARV-027 is an investigational, oral, peripherally restricted PROTAC designed to selectively target and eliminate the polyQ-AR in skeletal muscle. ARV-027 is a product candidate specifically selected for potent in vitro reduction of cytosolic and nuclear polyQ-AR and for favorable skeletal muscle exposure following oral administration.
The polyQ-AR protein is the pathogenic driver of spinal bulbar muscular atrophy, or SBMA, a rare, X-linked, genetically defined neuromuscular disease caused by a CAG trinucleotide repeat expansion in the androgen receptor, or AR, gene, causing protein misfolding and leading to progressive degeneration of the neuromuscular system in men. SBMA is also known as Kennedy's disease. SBMA leads to progressive muscle weakness, dysphagia, and functional decline, and currently has no disease-modifying therapies approved by the FDA or EMA, representing a significant unmet medical need.
In the first quarter of 2026, at the Kennedy's Disease Association conference, we shared preclinical data in an aggressive SBMA mouse model showing that oral ARV-027 degraded polyQ-AR in muscle, led to meaningful functional improvements, and extended survival. We believe ARV-027 has the potential to become the first treatment option for many patients with SBMA, where no disease-modifying therapies have been approved in the U.S. or European Union.
We initiated the first-in-human Phase 1 clinical trial in ARV-027 in healthy volunteers in the first quarter of 2026. In the second quarter of 2026, we completed the single-ascending dose cohorts in the first-in-human Phase 1 clinical trial in healthy volunteers and, in the third quarter of 2026, we initiated enrollment in the multiple dose cohorts in the Phase 1 clinical trial in healthy volunteers. We plan to continue enrollment in the multiple dose cohort of the Phase 1 clinical trial of ARV-027 in healthy volunteers and share initial data evaluating AR-degradation in muscle in the first half of 2027. In addition, the Phase 1 clinical trial design also includes patients with SBMA in the later multiple dose cohorts.
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ARV-806: Novel PROTAC KRAS G12D Degrader Program
ARV-806 is an investigational novel PROTAC designed to selectively target and degrade mutant KRAS G12D in solid tumors. KRAS is one of the most frequently mutated human oncogenes and G12D is the most common mutation of the KRAS protein. In normal cells, the KRAS protein regulates cell growth and functions as a molecular switch, cycling between a baseline “OFF” state and only turning “ON” when conditions are appropriate for growth. Mutations, including G12D, lock KRAS in the “ON” form, leading to uncontrolled cell growth and cancer. ARV-806 is designed to degrade both the ON and OFF forms of KRAS G12D and by removing this oncogenic protein, has the potential to shut down the constitutive growth signal and lead to death of the cancer cells. We believe ARV-806 has the potential to address high unmet need in solid tumors, such as pancreatic, colorectal and non-small cell lung cancer, or NSCLC, with KRAS G12D mutation.
Preclinical Development
In the preclinical setting, ARV-806 demonstrated high potency and selectivity, with robust antitumor activity through dose-responsive degradation of KRAS G12D in KRAS G12D mutated cancer models, including pancreatic and colorectal models. ARV-806 formed a ternary complex with both the active "ON" and inactive "OFF" forms of KRAS G12D, achieving potent and durable elimination rather than inhibition of the target. As a result, in preclinical studies, ARV-806 achieved in vitro potency more than 25 times greater than clinical stage KRAS G12D "ON" and "OFF" inhibitors and more than 40 times greater than the leading KRAS G12D clinical-stage degrader.
Clinical Development
We filed an IND with the FDA for ARV-806 in the first quarter of 2025 and received a safe-to-proceed letter from the FDA in the second quarter of 2025. We initiated enrollment in a Phase 1 clinical trial of ARV-806 in patients with advanced solid tumors harboring KRAS G12D mutations in the second quarter of 2025 and this trial is currently ongoing.
In the second quarter of 2026, we announced that we had completed dose escalation enrollment of the Phase 1 clinical trial evaluating ARV-806 in patients with solid tumors harboring KRAS G12D mutations. We are planning to complete this Phase 1 monotherapy dose escalation clinical trial and share clinical data in the second half of 2026. In the second quarter of 2026 we also announced that we plan to seek an out-licensing agreement for any additional clinical trials of ARV-806, including dose expansion or combination clinical trials.
Approved Product: VEPPANU
VEPPANU is an orally bioavailable PROTAC, estrogen receptor degrader approved in the U.S. for use as a monotherapy in the treatment of adults with ER+/HER2-, ESR1-mutated advanced or metastatic breast cancer, as detected by an FDA-authorized test, with disease progression following at least one line of endocrine therapy. VEPPANU is the first and only FDA-approved PROTAC protein degrader, a type of heterobifunctional protein degrader therapy.
We have been co-developing vepdegestrant with Pfizer, pursuant to a collaboration agreement that we and Pfizer entered into in July 2021. Pursuant to this agreement, we granted Pfizer worldwide co-exclusive rights to develop and commercialize vepdegestrant, which at that time, was an investigational, oral PROTAC estrogen receptor degrader.
In the second quarter of 2026, we and Pfizer entered into the Rigel License Agreement with Rigel for the exclusive global development, manufacturing, and commercialization rights for VEPPANU. Under the terms of the Rigel License Agreement, Rigel will be responsible for the launch and commercialization of VEPPANU in the U.S. and will own global rights with the ability to sublicense to potential partners to further develop and commercialize VEPPANU outside of the U.S.
Preclinical Development
In preclinical studies, vepdegestrant demonstrated near-complete ER degradation in tumor cells, induced robust tumor shrinkage when dosed as a single agent in multiple ER-driven xenograft models and showed superior anti-tumor activity when compared to a standard of care agent, fulvestrant, both as a single agent and in combination with a cyclin-dependent kinase, or CDK, 4/6 inhibitor.
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Clinical Development
We, along with Pfizer, have ongoing clinical trials of vepdegestrant, for which enrollment of patients is complete, which are summarized below.
•TACTIVE-K, a Phase 1b/2 clinical trial of vepdegestrant in combination with Pfizer's cyclin-dependent kinase 4, or CDK4, inhibitor, atirmociclib; and
•TACTIVE-U, a Phase 1b/2 clinical trial of vepdegestrant in combination with multiple targeted therapies including abemaciclib, ribociclib or Carrick Therapeutics, Inc.'s, or Carrick, cyclin-dependent kinase 7, or CDK7, inhibitor, samuraciclib.
We, along with Pfizer, also have several completed clinical trials of vepdegestrant:
•VERITAC-2, a Phase 3 clinical trial of vepdegestrant as a monotherapy, targeting metastatic breast cancer previously treated with endocrine based therapy;
•VERITAC, a Phase 2 dose expansion clinical trial of vepdegestrant as a monotherapy, targeting previously treated metastatic breast cancer;
•TACTIVE-N, a Phase 2 clinical trial of vepdegestrant as a monotherapy in the neoadjuvant setting; and
•TACTIVE-E, a Phase 1 clinical trial of vepdegestrant in combination with everolimus.
Additionally, VERITAC-3, a clinical trial with a study lead-in of vepdegestrant in combination with palbociclib for the treatment of patients with first-line metastatic breast cancer, is ongoing and enrollment of patients is complete. As previously disclosed, VERITAC-3 will not proceed beyond the study lead-in.
VERITAC-2 Clinical Trial, VEPPANU FDA Approval and Rigel License Agreement
In the first quarter of 2025, we, along with Pfizer, announced positive topline results from the Phase 3 VERITAC-2 clinical trial in the estrogen receptor 1-mutant, or ESR1m, population, and in the second quarter of 2025, we, along with Pfizer, announced detailed results from this clinical trial.
In the clinical trial, vepdegestrant, now approved as VEPPANU, demonstrated a statistically significant and clinically meaningful improvement in progression-free survival, or PFS, among ER+/HER2- advanced and metastatic breast cancer patients with an ESR1 mutation, reducing the risk of disease progression or death by 43% compared to fulvestrant, which is administered via an intramuscular injection. The median PFS, as assessed by blinded independent central review, was 5.0 months with VEPPANU versus 2.1 months with fulvestrant. In the clinical trial, VEPPANU was generally well tolerated, with a safety profile consistent with what has been observed in previous studies, and mostly low-grade treatment-emergent adverse events, or TEAEs. The three most common TEAEs observed with VEPPANU were fatigue, increased alanine transaminase, and increased aspartate aminotransferase. Detailed results were presented in a late-breaking oral presentation at the American Society of Clinical Oncology, or ASCO, 2025 Annual Meeting and were highlighted in the ASCO press briefing and selected for Best of ASCO, and were also simultaneously published in the New England Journal of Medicine.
Based on the results from VERITAC-2, in the second quarter of 2025, we and Pfizer submitted an NDA to the FDA for vepdegestrant for the treatment of patients with ER+/HER2- ESR1-mutated advanced or metastatic breast cancer previously treated with endocrine-based therapy. This represented the first NDA submitted for a PROTAC. In the third quarter of 2025, we announced that the FDA accepted the NDA for vepdegestrant and assigned a PDUFA action date of June 5, 2026. In the second quarter of 2026, we announced that the FDA has approved the Company’s new drug application for VEPPANU for the treatment of adults with ER+/ HER2-, ESR1-mutated advanced or metastatic breast cancer, as detected by an FDA-authorized test, with disease progression following at least one line of endocrine-based therapy. In the second quarter of 2026, we and Pfizer entered into the Rigel License Agreement with Rigel for the exclusive global development, manufacturing, and commercialization rights for VEPPANU, which is discussed in greater detail below and in Note 3, Research Collaboration and License Agreements.
In addition, on May 8, 2026, the National Comprehensive Cancer Network® (NCCN®) added vepdegestrant (VEPPANU) to the latest NCCN Clinical Practice Guidelines in Oncology (NCCN Guidelines®)
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for Breast Cancer. Vepdegestrant (VEPPANU) was added as a Category 2A treatment option for patients with hormone receptor (HR)-positive/HER2-negative, ESR1-mutated advanced or metastatic breast cancer after at least one line of endocrine therapy + cyclin-dependent kinase (CDK) 4/6 inhibitor.*
*NCCN makes no warranties of any kind whatsoever regarding their content, use, or application and disclaims any responsibility for their application or use in any way.
Preclinical and Other Programs
We have active preclinical programs in neurology and oncology. In 2025 we announced two new product candidate nominees, ARV-027 and ARV-6723. As described above, we initiated a Phase 1 clinical trial for ARV-027 in the first quarter of 2026.
ARV-6723: Oral PROTAC HPK1 Degrader
ARV-6723 is an oral investigational PROTAC designed to degrade HPK1 in solid malignancies. Preclinically, ARV-6723 has shown potent, selective HPK1 degradation and strong anti-tumor immune responses with superior tumor control in low- and high- immunogenic murine syngeneic tumor models. In solid tumor malignancies, such as NSCLC, melanoma, and renal cell carcinoma, or RCC, HPK1 acts as a negative regulator in T-cell receptor signaling, contributing to T-cell exhaustion and suppressing antitumor immunity. In addition, HPK1 has a regulatory role in other immune cell types that can be co-opted by tumors, thus enabling these cancers to resist immuno-oncology therapy. Degrading HPK1 and thus eliminating both its kinase and scaffolding functions has the potential to unleash an immune response with potent anti-tumor effects and minimum off-target toxicity.
We presented preclinical data at the Society for Immunotherapy of Cancer annual meeting in the fourth quarter of 2025 that we believe supports the potential of ARV-6723 to provide sustained anti-tumor immune response as a single agent or in combination with standards of care with improved clinical benefits, including that: ARV-6723, as a single agent, demonstrates anti-tumor efficacy superior to anti-PD1 or a clinical HPK1 inhibitor and combines with anti-PD1 to further enhance response; and ARV-6723 single agent activity outperforms the HPK1 inhibitor and anti-PD-1 efficacy and reinstitutes the tumor microenvironment.
In addition, we presented preclinical data for ARV-6723 at the AACR Immuno-Oncology Conference in the first quarter of 2026 that support clinical investigation of ARV-6723 in patients with solid tumors harboring high- or low-immunogenic tumor microenvironments, or TME, including immune checkpoint inhibitor, or ICI,-resistant tumor settings. This preclinical data showed robust single-agent antitumor and proinflammatory activity in multiple syngeneic tumor models, including those with immunosuppressive TMEs, and showed greater preclinical activity than an investigational HPK1 inhibitor or an anti-PD-1 antibody.
At the AACR Annual Meeting in the second quarter of 2026, we presented preclinical data that demonstrated greater antitumor activity than SOC ICIs or an investigational HPK1 inhibitor. These preclinical data presented showed that ARV-6723, unlike an inhibitor and the ICIs, reverses T-cell exhaustion, reverses the immunosuppressive microenvironment and boosts innate cell immunity in ICI-(aPD1 and aCTLA4) resistant models. We believe these preclinical results support future investigation of ARV-6723 alone or in combination with other agents in patients with high- or low-immunogenic tumors.
We plan to initiate a Phase 1 clinical trial of ARV-6723 in patients with advanced solid tumors in the third quarter of 2026. Upon initiation of the clinical trial, ARV-6723 will be our first clinical candidate in immuno-oncology. The trial design includes a plan for dose escalation and an expansion combination cohort with
pembrolizumab once sufficient monotherapy data are available.
Pan-KRAS Program
Our preclinical oral pan-KRAS program targets multiple variants of KRAS that drive solid tumors such as PDAC, colorectal cancer, NSCLC, and esophageal cancer, while sparing other RAS isoforms. We believe selectively targeting KRAS for removal may have benefits to tolerability compared with a pan-RAS approach. The poster presented at the 2025 Triple Meeting in the fourth quarter of 2025 showed that orally bioavailable pan-KRAS degraders have been identified that potently degrade multiple variants of KRAS and spare other RAS isoforms. A tool pan-KRAS PROTAC demonstrated robust single-agent activity and superior combination
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efficacy with immune checkpoint blockade compared with a pan-RAS (ON) inhibitor (seven complete responses compared with two complete responses).
In the first quarter of 2026, at the AACR Special Conference in Cancer Research: RAS Oncogenesis and Therapeutics, we presented preclinical data that demonstrated: robust efficacy in CDX models of pancreatic, colorectal, and lung cancer, greater tumor growth inhibition than a pan-RAS (ON) inhibitor in a KRAS G13D model, and enhanced combination efficacy with immune checkpoint blockade compared with a pan-RAS (ON) inhibitor in a KRAS G12D syngeneic model.
Other Out-licensed or Completed Programs: Luxdegalutamide (ARV-766) and Bavdegalutamide (ARV-110)
We had been developing luxdegalutamide and bavdegalutamide, each an investigational, orally bioavailable, AR degrading PROTAC targeted protein degrader, for the treatment of men with metastatic castration-resistant prostate cancer, or mCRPC. Both luxdegalutamide and bavdegalutamide demonstrated activity in preclinical models of AR overexpression and AR mutations, both common mechanisms of resistance to current standard-of-care agents in men with prostate cancer. We believed that the differentiated PROTAC pharmacology of luxdegalutamide and bavdegalutamide, including their iterative activity, had the potential to translate into significantly improved clinical outcomes over current SOC agents. However, a comparison of clinical data from separate studies of luxdegalutamide and bavdegalutamide showed that luxdegalutamide’s tolerability and efficacy was more promising than that of bavdegalutamide. As a result, early in the fourth quarter of 2023, we determined to prioritize the initiation of a Phase 3 clinical trial with luxdegalutamide in mCRPC instead of the previously planned Phase 3 clinical trial for bavdegalutamide. Clinical trials for bavdegalutamide (ARV-110-101 and ARV-110-103) were completed in the second quarter of 2025.
In the second quarter of 2024, we completed a transaction with Novartis Pharma AG, or Novartis, which comprised a license agreement, or the Novartis License Agreement, and an asset agreement, or the Novartis Asset Agreement. Pursuant to the Novartis License Agreement, we granted Novartis an exclusive worldwide license for the development, manufacture and commercialization of luxdegalutamide, and we completed the transition of our ongoing and planned clinical trials of luxdegalutamide to Novartis in the fourth quarter of 2024. Pursuant to the Novartis Asset Agreement, we sold Novartis all of our rights, title and interest in our PROTAC protein degrader targeting AR-V7, a splice variant of the AR.
Our Operations
We commenced operations in 2013. Our operations to date have been limited to organizing and staffing our company, business planning, raising capital, conducting discovery and research activities, filing patent applications, identifying potential product candidates, undertaking preclinical studies and clinical trials, establishing arrangements with third parties for collaborations or licensing arrangements and for the manufacture of initial quantities of our product candidates and preparing for potential commercialization. To date, we have not generated any revenue from product sales and have financed our operations primarily through sales of assets and equity interests, proceeds from our collaborations and licensing arrangements, an asset sale, grant funding and debt financing. Since inception through June 30, 2026, we raised approximately $1.7 billion in gross proceeds from the sale of assets and equity interests and the exercise of stock options and had received an aggregate of $1.0 billion in payments primarily from collaboration partners and a licensing arrangement.
We are a biotechnology company, with product candidates in clinical development and other drug discovery activities in the research and preclinical development stages. Our ability to generate revenue from product sales sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of one or more of our product candidates.
In the second quarter of 2026, we announced that the FDA has approved VEPPANU for the treatment of adults with ER+/HER2-, ESR1-mutated advanced or metastatic breast cancer, as detected by an FDA-authorized test, with disease progression following at least one line of endocrine-based therapy. Also in the second quarter of 2026, we and Pfizer entered into the Rigel License Agreement with Rigel for the exclusive global development, manufacturing, and commercialization rights for VEPPANU. All decisions related to pricing, access, reimbursement, sublicense and ex-U.S. regulatory plans for VEPPANU will be determined by Rigel. Our ability to generate revenue from the sale of VEPPANU will be entirely dependent on Rigel, and we may never
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generate product revenue from the Rigel License Agreement to realize any profits from the out-license of VEPPANU.
Any delay or failure to obtain regulatory approvals would materially adversely affect our product candidate development efforts and our business overall. Because of the numerous risks and uncertainties associated with product development, we are unable to predict the timing or amount of increased expenses or when or if we will be able to achieve or maintain profitability. Even if we are able to generate product sales, we may not become profitable. If we fail to become profitable or are unable to sustain profitability on a continuing basis, then we may be unable to continue our operations at planned levels and be forced to reduce or terminate our operations.
We regularly review our operations and make decisions we believe best support our business strategy. In April 2025, as part of our decision to streamline operations across our organization and enable the efficient progression of our portfolio, we committed to and approved a reduction of our workforce by approximately 33% across all areas of our company. The workforce reduction was aimed at reducing internal costs while minimally impacting our targeted clinical stage programs to drive value over the next several years by aligning our operations with long-term program development objectives. The April 2025 workforce reduction was completed by the end of the second quarter of 2025.
In September 2025, we announced an update on our collaboration with Pfizer and further actions to support value creation by optimizing organizational and cost structures and streamlining operations in advance of multiple anticipated upcoming value inflection points, including: further limiting additional expenditures on the vepdegestrant program to support activities required for commercialization readiness and identification, with Pfizer, of a third party for the commercialization and potential further development of vepdegestrant; reducing our workforce by an additional 15% to streamline operations, with the most significant reductions being roles related to vepdegestrant commercialization; and proactively managing pipeline cost by seeking strategic business development opportunities and by identifying further efficiencies across the business. The September 2025 workforce reduction was completed by the second quarter of 2026. Refer to Note 14, Restructuring Activity, in this Quarterly Report on Form 10-Q for further details.
In the first quarter of 2026, we announced the appointment of Randy Teel, Ph.D., as our President, Chief Executive Officer and as a member of our board of directors. Dr. Teel, who previously served as our Chief Business Officer, succeeds John Houston, Ph.D., who is retired from his role as President, Chief Executive Officer, and Chair of our board of directors. Dr. Houston will continue to serve as a member of the Board and has entered into a consulting agreement with us whereby he will provide consulting and advisory services. Briggs Morrison, M.D., our lead independent director, has been elected to serve as Chair of our board of directors. In the second quarter of 2026, we announced that Noah Berkowitz, M.D., Ph.D. would depart from his employment with us as chief medical officer effective July 3, 2026. We have begun a search to find a new chief medical officer to replace Dr. Berkowitz.
Since inception, we have incurred significant operating losses and, even in light of our workforce reductions and cost optimization decisions, expect to continue to incur operating losses for at least the next several years. In addition to any additional costs not currently contemplated due to the events associated with or resulting from our workforce reductions, our ability to achieve profitability and our financial position will depend, in part, on the rate of our future expenditures, potential collaboration revenue, our ability to successfully implement cost avoidance measures and reduce overhead costs and our ability to obtain additional funding.
We expect to continue to incur significant expenses associated with: our ongoing and anticipated preclinical and clinical activities, development activities, research activities in oncology, neuroscience and other disease areas, managing our employees and retaining key talent in research, clinical trials, quality and other functional areas, expenses incurred with contract manufacturing organizations, or CMOs, and contract development and manufacturing organizations, or CDMOs, to supply us with product for our preclinical and clinical studies and expenses incurred with contract research organizations, or CROs, for the synthesis of compounds in our preclinical development activities, as well as other associated costs including those related to partnering with us on our clinical trial portfolio and the management of our intellectual property portfolio.
We do not expect to generate any revenue from product sales in the near future, if ever.
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As noted above, our ability to generate revenue from the sale of VEPPANU will be entirely dependent on Rigel's performance of its obligations under the Rigel License Agreement, and we may never generate product revenue from the Rigel License Agreement to realize any profits from the out-license of VEPPANU.
Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations. If we are unable to raise capital when needed or on attractive terms, we could be forced to delay, reduce or eliminate our research or product development programs or any future commercialization efforts, or to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or to grant licenses on terms that may not be favorable to us.
As of June 30, 2026, we had cash, cash equivalents and marketable securities of $567.9 million. We believe the existing cash, cash equivalents and marketable securities on hand will be sufficient to fund our operations into the second half of 2028, which will enable us to execute on multiple data readouts across our programs. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. See “Liquidity and Capital Resources” below.
Financial Operations Overview
Revenue
To date, we have not generated any revenue from product sales and do not expect to generate any revenue from the sale of products in the near future, other than potentially pursuant to the Rigel License Agreement. Our revenues to date have been generated through research collaborations, licensing arrangements and an asset sale. Revenue is recognized ratably over our expected performance period under each agreement.
While we do have one approved product, VEPPANU, and we have entered into the Rigel License Agreement, our ability to generate revenue from the sale of VEPPANU will be entirely dependent on Rigel's performance of its obligations under the Rigel License Agreement, and we may never generate product revenue from the Rigel License Agreement to realize any profits from the out-license of VEPPANU. All decisions related to pricing, access, reimbursement, sublicense and ex-U.S. regulatory plans for VEPPANU will be determined by Rigel.
We expect that any revenue recognized in the near term will be derived primarily from our current collaboration agreements and licensing arrangements and any additional arrangements that we may enter into in the future. We received a $20.0 million development milestone during the year ended December 31, 2025 pursuant to the terms of the Novartis License Agreement and a $50.0 million development milestone during the three months ended June 30, 2026 pursuant to the Original Vepdegestrant (ARV-471) Collaboration Agreement in connection with the FDA’s approval of VEPPANU. To date, no other development, regulatory and commercial milestone payments or royalties have been received under any of our other collaboration agreements or licensing arrangements.
Rigel License Agreement
On May 11, 2026, we, including our direct subsidiaries, Arvinas Operations, Inc. and Arvinas Estrogen Receptor, Inc., together with Pfizer, entered into the Rigel License Agreement with Rigel. Pursuant to the Rigel License Agreement, we and Pfizer granted to Rigel a license for the exclusive global development, manufacturing and commercialization rights for VEPPANU, an orally bioavailable PROteolysis TArgeting Chimera (PROTAC), ER+/HER2-, ESR1-mutated advanced or metastatic breast cancer, as detected by a FDA-authorized test, with disease progression following at least one line of endocrine therapy.
Under the terms of the Rigel License Agreement, Rigel will be responsible for the launch and commercialization of VEPPANU in the U.S. and will own global rights with the ability to sublicense to potential partners to further develop and commercialize VEPPANU outside of the U.S. We and Pfizer will be entitled to a percentage of sublicensing revenue generated outside the U.S. Rigel has agreed to reimburse us and Pfizer up to $40.0 million of the costs of ongoing development activities that were in progress as of the effective date of the Rigel License Agreement. While Pfizer is responsible for these ongoing development activities, we and
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Pfizer will share equally in this reimbursement and therefore we will reimburse Pfizer for 50% of the costs of such activities.
Under the terms of and as consideration for entering into the Rigel License Agreement, Rigel paid to us and Pfizer a one-time, upfront payment in the aggregate amount of $70.0 million. In addition, we and Pfizer will receive an additional payment in the amount of $15.0 million from Rigel upon successful completion of select development and manufacturing transition activities. We and Pfizer will also be eligible to receive up to an additional $320.0 million in the aggregate as contingent payments based on future development, regulatory and commercial milestones being met, as well as tiered royalties in the mid-teens to mid-20s based upon worldwide net sales of VEPPANU, subject to reduction under certain circumstances as provided in the Rigel License Agreement. All payments under the Rigel License Agreement will be distributed evenly between us and Pfizer. The milestones and royalty payments under the Rigel License Agreement replace any unearned future amounts that may be owed by Pfizer to us under the Original Vepdegestrant (ARV-471) Collaboration Agreement.
The Rigel License Agreement became effective on June 11, 2026 and will expire on a country-by-country and licensed product-by-licensed product basis until the expiration of the applicable royalty term. The Rigel License Agreement contains customary termination provisions, including that Rigel may terminate the Rigel License Agreement upon the material breach of us and/or Pfizer and we and Pfizer may terminate the Rigel License Agreement upon the material breach of Rigel. Additionally, Rigel may terminate the Rigel License Agreement for convenience subject to a written notice period, following a pre-defined period of time.
Pfizer Vepdegestrant (ARV-471) Collaboration Agreement
In July 2021, we entered into the Original Vepdegestrant (ARV-471) Collaboration Agreement, pursuant to which we granted Pfizer worldwide co-exclusive rights to develop and commercialize products containing our proprietary compound vepdegestrant (ARV-471), or the Licensed Products.
Under the Original Vepdegestrant (ARV-471) Collaboration Agreement, we received an upfront, non-refundable payment of $650.0 million. In addition, we were eligible to receive up to an additional $1.4 billion in contingent payments based on specified regulatory and sales-based milestones for the Licensed Products. Of the total contingent payments, $400.0 million in regulatory milestones were related to marketing approvals and $1.0 billion were related to sales-based milestones.
Further, under the Original Vepdegestrant (ARV-471) Collaboration Agreement, we and Pfizer shared equally (50/50) all development costs for the Licensed Products (including costs for conducting any clinical trials), subject to certain exceptions.
Unless earlier terminated in accordance with its terms, the Original Vepdegestrant (ARV-471) Collaboration Agreement will expire on a Licensed Product-by-Licensed Product and country-by-country basis when such Licensed Product is no longer commercialized or developed for commercialization in such country. Pfizer may terminate the Original Vepdegestrant (ARV-471) Collaboration Agreement for convenience in its entirety or on a region-by-region basis subject to certain notice periods. Either party may terminate the Original Vepdegestrant (ARV-471) Collaboration Agreement for the other party’s uncured material breach or insolvency. Subject to applicable terms of the Original Vepdegestrant (ARV-471) Collaboration Agreement, including certain payments to Pfizer upon termination for our uncured material breach, effective upon termination of the Original Vepdegestrant (ARV-471) Collaboration Agreement, we are entitled to retain specified licenses to be able to continue to exploit the Licensed Products.
Subject to specified exceptions, under the Original Vepdegestrant (ARV-471) Collaboration Agreement, we and Pfizer each agreed not to directly or indirectly research, develop, or commercialize any competing products outside of the Original Vepdegestrant (ARV-471) Collaboration Agreement anywhere in the world during the term of the Original Vepdegestrant (ARV-471) Collaboration Agreement.
In the second quarter of 2026, we announced that the FDA has granted approval for VEPPANU for the treatment of adults with ER+/HER2-, ESR1-mutated advanced or metastatic breast cancer, as detected by an FDA-authorized test, with disease progression following at least one line of endocrine-based therapy. Pursuant to the Original Vepdegestrant (ARV-471) Collaboration Agreement, we received $50.0 million as a development milestone payment in connection with the FDA’s approval of VEPPANU.
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In May 2026, we, Pfizer and Rigel entered into the Rigel License Agreement. In connection with and to facilitate entry into the Rigel License Agreement, we and Pfizer also entered into a letter agreement supplementing and amending the terms of the Original Vepdegestrant (ARV-471) Collaboration Agreement, or the Pfizer Letter Agreement. Pursuant to the terms of the Pfizer Letter Agreement, until any termination of the Rigel License Agreement, the milestones and royalty payments under the Rigel License Agreement replace any unearned future amounts that may be owed by Pfizer to us under the Original Vepdegestrant (ARV-471) Collaboration Agreement.
Pfizer Research Collaboration Agreement
In December 2017, we entered into a Research Collaboration and License Agreement with Pfizer, setting forth our collaboration to identify or optimize PROTAC targeted protein degraders that mediate for degradation of targets, using our proprietary platform technology that are identified in the agreement or subsequently selected by Pfizer, subject to certain exclusions. We refer to this agreement as the Pfizer Research Collaboration Agreement.
Under the Pfizer Research Collaboration Agreement, Pfizer designated a number of initial targets. Pursuant to the terms of the Pfizer Research Collaboration Agreement, for each identified target protein, we and Pfizer would conduct a separate research program pursuant to a research plan. Pfizer was also entitled to make substitutions for any of the initial target protein candidates, subject to the stage of research for such target.
In the year ended December 31, 2018, we received an upfront non-refundable payment and certain additional payments totaling $28.0 million in exchange for use of the technology license and to fund Pfizer-related research, as defined within the Pfizer Research Collaboration Agreement. As of June 30, 2026, the research program term under the Pfizer Research Collaboration Agreement has concluded and no targets currently remain. In accordance with the terms of the Pfizer Research Collaboration Agreement, we were eligible to receive up to an additional $3.8 million in non-refundable option payments if Pfizer exercised its option for the then-remaining target protein under the Pfizer Research Collaboration Agreement. Under the terms of the Pfizer Research Collaboration Agreement, we were also entitled to receive up to $225.0 million in development milestone payments and up to $550.0 million in sales-based milestone payments for all designated target proteins under the Pfizer Research Collaboration Agreement, as well as tiered royalties based on sales, which were subject to reductions. There were no sales-based milestone payments or royalties received through June 30, 2026.
Novartis Transaction
In April 2024, we entered into a transaction, or the Novartis Transaction, including both a license agreement, or the Novartis License Agreement, and an asset agreement, or the Novartis Asset Agreement, with Novartis Pharma AG, or Novartis. The Novartis Transaction closed in May 2024 upon the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, at which time both the Novartis License Agreement and the Novartis Asset Agreement became effective.
Pursuant to the Novartis License Agreement, we granted Novartis an exclusive worldwide license for the development, manufacture and commercialization of luxdegalutamide (ARV-766), our second generation PROTAC AR degrader for patients with prostate cancer. Pursuant to the Novartis Asset Agreement, we sold to Novartis all of our rights, title and interest in our PROTAC protein degrader targeting AR-V7, a splice variant of the AR.
Under the terms of and as consideration for entering into the Novartis Transaction, we received a one-time, upfront payment in the aggregate amount of $150.0 million from Novartis. Under the Novartis License Agreement, we are also eligible to receive up to an additional $1.01 billion as contingent payments based on specified development, regulatory, and commercial milestones for luxdegalutamide (ARV-766) being met, as well as tiered royalties based upon worldwide net sales of luxdegalutamide (ARV-766), subject to reduction under certain circumstances as provided in the Novartis License Agreement. During the year ended December 31, 2025, we received $20.0 million upon the achievement of a development milestone pursuant to the terms of the Novartis License Agreement. There were no development, regulatory or commercial milestone payments, or sales-based royalties received during the six months ended June 30, 2026.
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The Novartis License Agreement will continue on a country-by-country basis (or, in certain cases, a region-by-region basis) until the expiration of the applicable royalty term for such country (or region, as applicable). The Novartis License Agreement contains customary termination provisions, including that either party may terminate the Novartis License Agreement (a) upon the material breach of the other party or (b) in the event the other party experiences an insolvency event. Additionally, Novartis may terminate the Novartis License Agreement for convenience or upon a safety or regulatory issue.
Genentech License Agreement
In September 2015, we entered into an Option and License Agreement with Genentech focused on PROTAC targeted protein degrader discovery and research for target proteins based on our proprietary platform technology, other than excluded target proteins as described below. This collaboration was expanded in November 2017 through an Amended and Restated Option, License and Collaboration Agreement, which we refer to as the Restated Genentech Agreement. Concurrently with entering into the Restated Genentech Agreement, Genentech exercised its exclusive option with respect to a PROTAC targeted protein degrader. We receive annual updates on research and development activities related to this option.
Under the Restated Genentech Agreement, Genentech had the right to designate up to ten targets for further discovery and research utilizing our PROTAC platform technology and also had the right to remove a target from the collaboration and substitute a different target that is not an excluded target at any time prior to us commencing research on such target or in certain circumstances following commencement of research by us. The research phase of the collaboration with Genentech ended, and Genentech was no longer able to nominate new targets into the collaboration. As of March 31, 2026, the only target that remained part of the collaboration was the PROTAC targeted protein degrader for which Genentech exercised its exclusive option upon amendment and restatement of the agreement. Pursuant to notice received from Genentech on June 9, 2026 in accordance with the terms of the Restated Genentech Agreement, the Restated Genentech Agreement will terminate effective August 8, 2026.
At the time we entered into the original agreement with Genentech, we received an upfront payment of $11.0 million, and at the time we entered into the Restated Genentech Agreement, we received an additional $34.5 million in upfront and expansion target payments. Under the Restated Genentech Agreement, prior to termination, we were eligible to receive payments aggregating up to $44.0 million per target protein upon the achievement of specified development milestones; payments aggregating up to $52.5 million per target protein (assuming approval of two indications) subject to the achievement of specified regulatory milestones; and payments aggregating up to $60.0 million per PROTAC targeted protein degrader directed against the applicable target protein, subject to the achievement of specified sales milestones. These milestone payments were subject to reduction if we did not have a valid patent claim covering the licensed PROTAC targeted protein degrader at the time the milestone is achieved. We were also eligible to receive, on net sales of licensed PROTAC targeted protein degraders, mid-single digit royalties, which may be subject to reductions.
Operating Expenses
Our operating expenses since inception have consisted solely of research and development costs and general and administrative costs.
Cost of License Revenue
Costs of license revenue consist primarily of royalties and other amounts payable to third parties that are directly attributable to license revenue recognized under our licensing arrangements. These costs are recognized in the same period as the related license revenue.
Research and Development Expenses
Research and development expenses consist primarily of costs incurred for our research activities, including our discovery efforts, and the development of our product candidates, and include:
•employee related expenses, including salaries, benefits, stock-based compensation expense and travel, for personnel engaged in research and development functions;
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•expenses incurred under agreements with third parties, including CROs and other third parties that conduct research, preclinical and clinical activities on our behalf as well as third parties that manufacture our product candidates for use in our preclinical studies and clinical trials;
•costs of outside consultants, including their fees, stock-based compensation and related travel expenses;
•the costs of laboratory supplies and developing preclinical studies and clinical trial materials;
•facility-related expenses, which include direct depreciation costs of equipment and allocated expenses for rent and maintenance of facilities and other operating costs;
•costs incurred in the development of intellectual property; and
•third-party licensing fees.
We expense research and development costs as incurred.
We typically use our employee and infrastructure resources across our development programs, and as such, do not track all of our internal research and development expenses on a program-by-program basis. The following table summarizes our research and development expenses for the three and six months ended June 30, 2026 and 2025:
For the Three Months Ended June 30, For the Six Months Ended June 30,
(dollars in millions) 2026 2025 2026 2025
Program-specific external expense:
Vepdegestrant (ARV-471) (*) $ 4.5 $ 15.1 $ 13.3 $ 39.2
ARV-806 5.6 1.7 12.1 2.6
ARV-102 5.1 3.8 10.7 10.3
ARV-393 4.8 2.5 8.5 5.1
ARV-027 3.3 0.1 5.0 0.2
Bavdegalutamide (ARV-110) (0.4) 0.9 (0.2) 2.0
Other programs 1.3 0.7 2.3 2.3
Total program-specific external expense 24.2 24.8 51.7 61.7
Non-program-specific external expense 8.5 11.1 17.7 25.0
Unallocated internal expense
Compensation and related personnel expense (including stock-based compensation) 17.4 28.4 38.7 65.3
Other research and development expense 2.5 4.3 4.9 7.4
Total unallocated internal expense 19.9 32.7 43.6 72.7
Total research and development expense $ 52.6 $ 68.6 $ 113.0 $ 159.4
(*) As of June 11, 2026, the effective date of the Rigel License Agreement, the Company's future performance obligations under the Original Vepdegestrant (ARV-471) Collaboration Agreement have been satisfied under Accounting Standards Codification Topic 606, Revenue from Contracts with Customers, or ASC 606, as a result of the terms of the Rigel Agreement. The Company recognized a collaboration liability to fund certain ongoing development activities in progress as of the effective date of the Rigel License Agreement being performed by Pfizer, which was recorded as a reduction of revenue. See Note 3, Research Collaboration and License Agreements, for further details. Prior to June 11, 2026, vepdegestrant expense included net reimbursements to and from Pfizer pursuant to the Original Vepdegestrant (ARV-471) Collaboration Agreement which were accounted for pursuant to ASC 808, Collaborative Arrangements, or ASC 808, and were recorded as an offset or an increase to research and development expenses.
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Research and development activities are central to our business model. We expect that our research and development expenses will continue to increase substantially for the foreseeable future as we continue to conduct our ongoing and/or planned clinical trials, including for ARV-393, ARV-102, ARV-027 and ARV-6723, and continue to discover and develop additional product candidates. Research and development expenses related to vepdegestrant, now approved as VEPPANU, have been shared equally with Pfizer since July 22, 2021, the effective date of the Original Vepdegestrant (ARV-471) Collaboration Agreement. Under the Original Vepdegestrant (ARV-471) Collaboration Agreement, we may have received reimbursement from, or make payments to, Pfizer to satisfy the cost sharing requirements. These payments are accounted for pursuant to ASC 808, which are recorded as an offset or an increase to research and development expenses.
We cannot determine with certainty the duration and costs of ongoing and any potential future clinical trials, including for ARV-393, ARV-102, ARV-027 or ARV-6723, or unexpected costs of ongoing clinical trials for any other product candidate we have or may develop or if, when, or to what extent we will generate revenue from the commercialization and sale of any product candidate for which we obtain marketing approval.
In the second quarter of 2026, we announced that the FDA has granted approval for VEPPANU for the treatment of adults with ER+/HER2-, ESR1-mutated advanced or metastatic breast cancer, as detected by an FDA-authorized test, with disease progression following at least one line of endocrine-based therapy. Also in the second quarter of 2026, we, Pfizer and Rigel entered into the Rigel License Agreement. Our ability to generate revenue from the sale of VEPPANU will be entirely dependent on Rigel, and we may never generate product revenue from the Rigel License Agreement to realize any profits from the out-license of VEPPANU. All decisions related to pricing, access, reimbursement, sublicense and ex-U.S. regulatory plans for VEPPANU will be determined by Rigel. We may never succeed in obtaining marketing approval for any other product candidate.
Further, the successful development and commercialization of our product candidates is highly uncertain. This is due to the numerous risks and uncertainties associated with developing drugs, including the uncertainty of:
•successfully completing preclinical studies and clinical trials;
•receipt and related terms of marketing approvals from applicable regulatory authorities;
•obtaining and maintaining patent and trade secret protection and regulatory exclusivity for our product candidates;
•making or maintaining arrangements with third-party manufacturers, or establishing manufacturing capabilities, for both clinical and commercial supplies of our product candidates;
•establishing sales, marketing, market access and distribution capabilities and launching commercial sales of our products, if and when approved, whether alone or in collaboration with others;
•acceptance of our products, if and when approved, by patients, the medical community and third-party payors;
•obtaining and maintaining third-party coverage and adequate reimbursement;
•maintaining a continued acceptable safety profile of the products following approval; and
•effectively competing with other therapies.
A change in the outcome of any of these variables with respect to the development of a product candidate could mean a significant change in the costs and timing associated with the development of that product candidate. For example, if the FDA or another regulatory authority were to require us to conduct clinical trials beyond those that we anticipate will be required for the completion of clinical development of a product candidate, or if we experience significant delays in our clinical trials due to patient enrollment or other reasons, we would be required to expend significant additional financial resources and time on the completion of clinical development.
General and Administrative Expenses
General and administrative expenses consist primarily of salaries and other related costs, including stock-based compensation for personnel in our executive, finance, business development and administrative
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functions. General and administrative expenses also include legal fees relating to intellectual property and corporate matters; professional fees for accounting, auditing, tax and consulting services; insurance costs; travel expenses; and facility-related expenses, which include direct depreciation costs and allocated expenses for rent and maintenance of facilities and other operating costs.
We expect that our general and administrative expenses will increase in the future as we manage our personnel, including retaining or hiring of key employees, and, as a result of any future need to increase our headcount to support research and development activities relating to our product candidates, develop our infrastructure and build out commercial operations for any potential launch of commercial sales of our products. We also have incurred and expect to continue to incur expenses associated with being a public company, including costs of accounting, audit, legal, regulatory and tax-related services associated with maintaining compliance with the Nasdaq Stock Market and U.S. Securities and Exchange Commission requirements; director and officer insurance costs; and investor and public relations costs.
Other Income
Other income consists primarily of interest income from marketable securities and money market accounts.
Income Taxes
Since our inception in 2013, we have not recorded any U.S. federal or state income tax benefits for the net losses we have incurred in any year or for our federal or state earned research and development tax credits, due to our uncertainty of realizing a benefit from those items.
As of December 31, 2025, we had $533.6 million of federal net operating loss carryforwards, all of which may be carried forward indefinitely, but the deductibility of such carryforwards is limited to 80% of our taxable income in the year in which carryforwards are used, $563.2 million of state and local net operating loss carryforwards which expire at various dates beginning in 2035, and $44.7 million of federal tax credit carryforwards and $22.3 million of state tax credit carryforwards which expire at various dates beginning in 2035.
We expect to generate federal and state net operating losses and credit carryforwards in 2026 and future periods. The revenue recognition and capitalization of research expenses are timing differences for tax purposes and deferred tax assets were established. We have provided a valuation allowance against the full amount of the deferred tax assets since, in the opinion of management, based upon our earnings history, it is more likely than not that the benefits will not be realized.
As of June 30, 2026, Arvinas, Inc. had four wholly owned subsidiaries organized as C-corporations: Arvinas Operations, Inc., Arvinas Androgen Receptor, Inc., Arvinas Estrogen Receptor, Inc., and Arvinas Winchester, Inc.
Critical Accounting Policies and Use of Estimates
Our management’s discussion and analysis of financial condition and results of operations is based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States. The preparation of our unaudited condensed consolidated financial statements and related disclosures requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, costs and expenses and the disclosure of contingent assets and liabilities in our unaudited condensed consolidated financial statements. 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. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.
There have been no material changes to our critical accounting policies from those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the Securities and Exchange Commission on February 24, 2026.
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Results of Operations
Comparison of the Three and Six Months Ended June 30, 2026 and 2025
For the Three Months Ended June 30, For the Six Months Ended June 30,
(dollars in millions) 2026 2025 $ change 2026 2025 $ change
Revenue $ 249.7 $ 22.4 $ 227.3 $ 265.3 $ 211.2 $ 54.1
Cost of license revenue (9.0) — (9.0) (9.0) — (9.0)
Research and development expenses (52.6) (68.6) 16.0 (113.0) (159.4) 46.4
General and administrative expenses (24.0) (25.3) 1.3 (43.0) (51.9) 8.9
Other income 5.5 10.0 (4.5) 11.8 21.6 (9.8)
Income tax (expense) benefit (0.2) 0.3 (0.5) (0.3) 0.2 (0.5)
Net income (loss) $ 169.4 $ (61.2) $ 230.6 $ 111.8 $ 21.7 $ 90.1
Reconciliation of GAAP and Non-GAAP Information
For the Three Months Ended June 30, For the Six Months Ended June 30,
(dollars in millions) 2026 2025 2026 2025
Research and development reconciliation
GAAP research and development expenses $ 52.6 $ 68.6 $ 113.0 $ 159.4
Less: restructuring expense 0.3 0.6 0.6 0.6
Less: stock-based compensation expense (*) 0.9 8.5 6.7 20.0
Non-GAAP research and development expenses $ 51.4 $ 59.5 $ 105.7 $ 138.8
General and administrative reconciliation
GAAP general and administrative expenses $ 24.0 $ 25.3 $ 43.0 $ 51.9
Less: restructuring expense 1.3 0.4 2.1 0.4
Less: stock-based compensation expense (*) 4.3 6.8 9.6 10.2
Non-GAAP general and administrative expenses $ 18.4 $ 18.1 $ 31.3 $ 41.3
(*) Excludes restructuring related stock-based compensation. See Note 14, Restructuring Activity, to the unaudited condensed consolidated financial statements for further details.
Non-GAAP Financial Information
We define non-GAAP expenses as GAAP expenses excluding restructuring and stock-based compensation expense. We use the non-GAAP financial measures, non-GAAP research and development expense and non-GAAP general and administrative expense, to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that non-GAAP financial information, when taken collectively, may be helpful to investors because it provides consistency and comparability with past financial performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool, and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Other companies, including companies in our industry, may calculate similarly titled non-GAAP measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures and not rely on any single financial measure to evaluate our business.
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Revenue
Revenue for the three months ended June 30, 2026 totaled $249.7 million, compared to $22.4 million for the three months ended June 30, 2025. The increase of $227.3 million was primarily due to $112.6 million of revenue from the Original Vepdegestrant (ARV-471) Collaboration Agreement with Pfizer, driven by the recognition of the remaining deferred revenue of $126.4 million upon entry into the Rigel License Agreement as we concluded our remaining future performance obligations have been satisfied as a result of the terms of the Rigel License Agreement, partially offset by a decrease in revenue of $13.8 million for the period prior to the Rigel License Agreement. In addition, we recognized $62.5 million of revenue from the Rigel License Agreement, $50.0 million of revenue from a development milestone payment in connection with the FDA’s approval of VEPPANU, and $2.2 million of revenue from the Pfizer Research Collaboration Agreement driven by the conclusion of the research program term and recognition of the remaining deferred revenue under the agreement.
Revenue for the six months ended June 30, 2026 totaled $265.3 million, compared to $211.2 million for the six months ended June 30, 2025. The increase of $54.1 million was primarily due to $62.5 million of revenue from the Rigel License Agreement, $50.0 million of revenue from a development milestone payment in connection with the FDA’s approval of VEPPANU, and $4.5 million of revenue from the Pfizer Research Collaboration Agreement driven by the conclusion of the research program term and recognition of the remaining deferred revenue under the agreement, offset by a net decrease of $62.9 million in revenue from the Original Vepdegestrant (ARV-471) Collaboration Agreement due to i) a decrease of $189.3 million for the period prior to the Rigel License Agreement driven primarily by prior year changes in total program cost estimates and (ii) an increase of $126.4 million driven by the recognition of the remaining deferred revenue upon entry into the Rigel License Agreement.
Cost of License Revenue
Cost of license revenue for the three and six months ended June 30, 2026 totaled $9.0 million, compared to zero for the three and six months ended June 30, 2025. The increase of $9.0 million was due to expenses under the Amended Yale License Agreement related to the FDA’s approval of VEPPANU and the entry into the Rigel License Agreement.
Research and Development Expenses
Research and development expenses for the three months ended June 30, 2026 totaled $52.6 million, compared to $68.6 million for the three months ended June 30, 2025. The decrease of $16.0 million was primarily due to a decrease in compensation and related personnel expenses of $11.0 million, which are not allocated by program, and a decrease in external expenses of $3.2 million. External expenses include (i) program-specific expenses, which decreased by $0.6 million, primarily driven by a decrease in our vepdegestrant (ARV-471) program of $10.6 million, partially offset by increases in our ARV-806, ARV-027 and ARV-393 programs of $3.9 million, $3.2 million and $2.3 million, respectively, and (ii) non-program specific expenses, which decreased by $2.6 million.
Non-GAAP research and development expenses for the three months ended June 30, 2026 totaled $51.4 million, compared to $59.5 million for the three months ended June 30, 2025, excluding $0.3 million and $0.6 million of restructuring expense for the three months ended June 30, 2026 and 2025, respectively, and $0.9 million and $8.5 million of non-cash stock-based compensation expense for the three months ended June 30, 2026 and 2025, respectively.
Research and development expenses for the six months ended June 30, 2026 totaled $113.0 million, compared to $159.4 million for the six months ended June 30, 2025. The decrease of $46.4 million was primarily due to a decrease in compensation and related personnel expenses of $26.6 million, which are not allocated by program, and a decrease in external expenses of $17.3 million. External expenses include (i) program-specific expenses, which decreased by $10.0 million, primarily driven by decreases in our vepdegestrant (ARV-471) and bavdegalutamide (ARV-110) programs of $25.9 million and $2.2 million, respectively, partially offset by increases in our ARV-806, ARV-027 and ARV-393 programs of $9.5 million, $4.8 million and $3.4 million, respectively, and (ii) our non-program specific expenses, which decreased by $7.3 million.
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Non-GAAP research and development expenses for the six months ended June 30, 2026 totaled $105.7 million, compared to $138.8 million for the six months ended June 30, 2025, excluding $0.6 million of restructuring expense for each of the six months ended June 30, 2026 and 2025, and $6.7 million and $20.0 million of non-cash stock-based compensation expense for the six months ended June 30, 2026 and 2025, respectively.
General and Administrative Expenses
General and administrative expenses totaled $24.0 million for the three months ended June 30, 2026, compared to $25.3 million for the three months ended June 30, 2025. The decrease of $1.3 million was primarily due to decreases in personnel and infrastructure related costs of $3.9 million and costs related to developing our commercial operations of $1.4 million, partially offset by an increase in professional fees of $4.2 million, inclusive of an increase in the amortization of costs to obtain a contract related to the Pfizer Letter Agreement supplementing and amending the terms of the Original Vepdegestrant (ARV-471) Collaboration Agreement and professional fees related to the Rigel License Agreement.
Non-GAAP general and administrative expenses for the three months ended June 30, 2026 totaled $18.4 million, compared to $18.1 million for the three months ended June 30, 2025, excluding $1.3 million and $0.4 million of restructuring expense for the three months ended June 30, 2026 and 2025, respectively, and $4.3 million and $6.8 million of non-cash stock-based compensation expense for the three months ended June 30, 2026 and 2025, respectively.
General and administrative expenses totaled $43.0 million for the six months ended June 30, 2026, compared to $51.9 million for the six months ended June 30, 2025. The decrease of $8.9 million was primarily due to decreases in personnel and infrastructure related costs of $4.1 million, costs related to developing our commercial operations of $3.2 million, and professional fees of $1.1 million, inclusive of an increase in the amortization of costs to obtain a contract related to the Pfizer Letter Agreement supplementing and amending the terms of the Original Vepdegestrant (ARV-471) Collaboration Agreement and professional fees related to the Rigel License Agreement.
Non-GAAP general and administrative expenses for the six months ended June 30, 2026 totaled $31.3 million, compared to $41.3 million for the six months ended June 30, 2025, excluding $2.1 million and $0.4 million of restructuring expense for the six months ended June 30, 2026 and 2025, respectively, and $9.6 million and $10.2 million of non-cash stock-based compensation expense for the six months ended June 30, 2026 and 2025, respectively.
Other Income
Other income totaled $5.5 million for the three months ended June 30, 2026, compared to $10.0 million for the three months ended June 30, 2025. The decrease of $4.5 million was primarily due to a decrease in interest income on our marketable securities of $4.8 million, partially offset by a decrease in realized foreign exchange losses of $0.3 million.
Other income totaled $11.8 million for the six months ended June 30, 2026, compared to $21.6 million for the six months ended June 30, 2025. The decrease of $9.8 million was primarily due to a decrease in interest income on our marketable securities of $10.1 million, partially offset by a decrease in realized foreign exchange losses of $0.3 million.
Income Tax Expense
Income tax expense totaled $0.2 million for the three months ended June 30, 2026, compared to an income tax benefit of $0.3 million for the three months ended June 30, 2025. The current and prior income tax totals were driven by the effect of equity compensation and the valuation allowance recorded against the full amount of our net deferred tax assets.
Income tax expense totaled $0.3 million for the six months ended June 30, 2026, compared to an income tax benefit of $0.2 million for the six months ended June 30, 2025. The current and prior income tax totals were driven by the effect of equity compensation and the valuation allowance recorded against the full amount of our net deferred tax assets.
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Liquidity and Capital Resources
Overview
We have one product, VEPPANU, approved for commercial sale in the United States. In the second quarter of 2026, we and Pfizer entered into the Rigel License Agreement with Rigel for the exclusive global development, manufacturing, and commercialization rights for VEPPANU. Our ability to generate revenue from the sale of VEPPANU will be entirely dependent on Rigel's performance of its obligations under the Rigel License Agreement, and we may never generate product revenue from the Rigel License Agreement to realize any profits from the out-license of VEPPANU. All decisions related to pricing, access, reimbursement, and plans for VEPPANU will be determined by Rigel.
To date, we have financed our operations primarily through the sales of assets and equity interests, proceeds from our collaborations and license arrangements, grant funding and debt financing. Since inception through June 30, 2026, we had received an aggregate of $1.0 billion in payments from collaboration partners and licensing arrangements, grant funding and forgivable and partially forgivable loans from the State of Connecticut, and raised approximately $1.7 billion in gross proceeds from the sale of assets and equity interests, and the exercise of stock options, including:
•October 2018: completion of our initial public offering in which we issued and sold an aggregate of 7,700,482 shares of common stock, for aggregate gross proceeds of $123.2 million before fees and expenses;
•July 2019: sale of 1,346,313 shares of common stock to Bayer AG for aggregate gross proceeds of $32.5 million;
•November 2019: completion of a follow-on offering in which we issued and sold 5,227,273 shares of common stock for aggregate gross proceeds of $115.0 million before fees and expenses;
•September – December 2020: sale of 2,593,637 shares of common stock in an “at-the-market offering” for aggregate gross proceeds of $65.6 million before fees and expenses;
•December 2020: completion of a follow-on offering in which we issued and sold 6,571,428 shares of common stock for aggregate gross proceeds of $460.0 million before fees and expenses;
•September 2021: issuance of 3,457,815 shares of common stock to Pfizer for aggregate gross proceeds of $350.0 million;
•July - September 2023: sale of 1,449,275 shares of common stock in an “at-the-market offering” for aggregate gross proceeds of $37.2 million before fees and expenses;
•November 2023: sale of 12,963,542 shares of common stock and pre-funded warrants to purchase 3,422,380 shares of common stock in a private placement for aggregate gross proceeds of $350.0 million before fees and expenses; and
•April 2024: sale of AR-V7 to Novartis under the Novartis Asset Agreement for $20.0 million.
In November 2023, we amended and restated the Equity Distribution Agreement with Piper Sandler & Company and Cantor Fitzgerald & Co., pursuant to which we may offer and sell from time to time, through the agents, up to approximately $262.8 million of the common stock registered under our universal shelf registration statement pursuant to one or more “at-the-market" offerings. During the six months ended June 30, 2026, no shares were issued under the amended and restated agreement.
Cash Flows
Our cash, cash equivalents, and marketable securities totaled $567.9 million and $685.4 million as of June 30, 2026 and December 31, 2025, respectively. We had an outstanding loan balance of $0.5 million and $0.6 million as of June 30, 2026 and December 31, 2025, respectively.
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The following table summarizes our sources and uses of cash for the period presented:
For the Six Months Ended June 30,
(dollars in millions) 2026 2025 $ change
Net cash used in operating activities $ (117.5) $ (184.3) $ 66.8
Net cash provided by investing activities 68.6 198.3 (129.7)
Net cash provided by financing activities 0.3 0.4 (0.1)
Net (decrease) increase in cash and cash equivalents $ (48.6) $ 14.4 $ (63.0)
Operating Activities
Net cash used in operating activities for the six months ended June 30, 2026 decreased by $66.8 million, compared with the six months ended June 30, 2025, primarily due to an increase in net income of $90.1 million and the establishment of a collaboration liability of $52.7 million related to the Pfizer Letter Agreement supplementing and amending the terms of the Original Vepdegestrant (ARV-471) Collaboration Agreement, and a decrease in deferred revenue of $5.8 million, partially offset by an increase in accounts receivable of $54.5 million related primarily to a milestone receivable under the Original Vepdegestrant (ARV-471) Collaboration Agreement, the establishment of contract assets of $26.8 million related to entry into the Rigel License Agreement, as well as a decrease in non-cash charges of $3.8 million. The change in non-cash charges was primarily due to a decrease in stock-based compensation of $7.3 million, partially offset by net accretion of bond discounts/premiums of $4.1 million.
Investing Activities
Net cash provided by investing activities for the six months ended June 30, 2026 decreased by $129.7 million, compared with the six months ended June 30, 2025, primarily due to a decrease in maturities of $157.0 million, partially offset by an increase in sales of marketable securities of $28.9 million.
Financing Activities
Net cash provided by financing activities for the six months ended June 30, 2026 decreased by $0.1 million, compared with the six months ended June 30, 2025.
Funding Requirements
Since our inception, we have incurred significant operating losses. We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future as we advance the preclinical and clinical development of our product candidates.
Specifically, we anticipate that our expenses will increase substantially if and as we:
•continue our ongoing and/or planned clinical trials of our product candidates, including ARV-393, our PROTAC protein degrader designed to target the BCL6 protein, ARV-102, our PROTAC protein degrader designed to target the LRRK2 protein, ARV-027, our PROTAC protein degrader designed to target the polyQ-AR protein, and ARV-806, our PROTAC protein degrader designed to target KRAS G12D for mutated cancers;
•progress our preclinical programs, including ARV-6723 and our pan-KRAS degrader program;
•progress additional PROTAC protein degrader programs into IND- or CTA-enabling studies;
•seek a third party for the further development of ARV-806;
•apply our PROTAC Discovery Engine to advance additional product candidates into preclinical and clinical development;
•expand the capabilities of our PROTAC Discovery Engine;
•seek marketing approvals for any product candidates that successfully complete clinical trials;
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•make decisions with respect to our personnel, including retention or future hiring of key employees, and establishment of a sales, marketing, market access, and distribution infrastructure to launch commercial sales of our products, if and when approved, whether alone or in collaboration with others;
•make decisions with respect to our infrastructure and capabilities, including to support our operations as a public company and our research, product development and future commercialization efforts;
•make or maintain arrangements with third-party manufacturers, or establish manufacturing capabilities, for both clinical and commercial supplies of our product candidates; and
•expand, maintain and protect our intellectual property portfolio.
We had cash, cash equivalents and marketable securities totaling approximately $567.9 million as of June 30, 2026. We believe that our cash, cash equivalents and marketable securities as of June 30, 2026 will enable us to fund our planned operating expenses and capital expenditure requirements into the second half of 2028. We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect. Our future capital requirements will depend on many factors, including:
•the progress, scope, costs and results of our ongoing and/or planned clinical trials of ARV-393, ARV-102, ARV-027 and ARV-806;
•the progress, scope, costs and results of preclinical and clinical development for our other product candidates and development programs, including ARV-6723 and our pan-KRAS degrader program;
•the number of, and development requirements for, other product candidates that we pursue, including our other oncology and neurology research programs;
•the success of any collaborations, including with Pfizer, and Novartis' and Rigel's performances under the Novartis License Agreement and Rigel License Agreement, respectively;
•the costs, timing and outcome of regulatory review of our product candidates;
•the costs and timing of future commercialization activities, including product manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval and which we choose to commercialize ourselves;
•the revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval;
•the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims; and
•our ability to establish additional collaboration arrangements with other biotechnology or pharmaceutical companies on favorable terms, if at all, or enter into license, marketing and royalty arrangements, and similar transactions for the development or commercialization of our product candidates.
As a result of these anticipated expenditures, we will need to obtain substantial additional financing in connection with our continuing operations. Until such time, if ever, as we can generate substantial revenue from product sales, we expect to finance our cash needs through a combination of equity offerings, debt financings, collaborations, strategic alliances and marketing, distribution or licensing arrangements. Although we may receive potential future payments under our collaborations and our out-licenses to Novartis and Rigel, we do not currently have any committed external source of funds. Adequate additional funds may not be available to us on acceptable terms, or at all. If we are unable to raise capital when needed or on attractive terms, we may be required to delay, limit, reduce or terminate our research, product development programs or any future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.
To the extent that we raise additional capital through the sale of equity or convertible debt securities, the terms of these securities may include liquidation or other preferences that adversely affect the rights of our
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common stockholders. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making acquisitions or capital expenditures or declaring dividends.
If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us.
Borrowings
In June 2018, we entered into an additional assistance agreement with the State of Connecticut, or the 2018 Assistance Agreement, to provide funding for the expansion and renovation of laboratory and office space. We borrowed $2.0 million under the 2018 Assistance Agreement in September 2018, of which $1.0 million was forgiven upon meeting certain employment conditions. Borrowings under the agreement bear an interest rate of 3.25% per annum, with interest only payments required for the first 60 months, and mature in September 2028. The 2018 Assistance Agreement requires that we be located in the State of Connecticut through September 2028 with a default penalty of repayment of the full original funding amount of $2.0 million plus liquidated damages of 7.5% of the total amount of funding received. As of June 30, 2026, $0.5 million remains outstanding under the 2018 Assistance Agreement.