Income Taxes

12 Months Ended

Dec. 31, 2025

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The following table summarizes the (loss) income before income tax expense by jurisdiction for the periods indicated (in thousands):

	Year Ended December 31,
	2025		2024		2023
Domestic	$	(155,255)	$	(207,965)	$	(338,942)
Foreign	37		(2)		126
Loss before income tax expense	$	(155,218)	$	(207,967)	$	(338,816)

The difference between the Company's provision for income taxes and the amounts computed by applying the statutory federal income tax rate to income before income taxes for the year ended December 31, 2025 is as follows (in thousands):

	Year Ended December 31, 2025
	Amount		%
Income taxes (benefit) at statutory federal rate	$	(32,596)	21.00	%
State and local taxes, net of federal income tax effect	—		—	%
Foreign tax effects
Other foreign	(23)		0.01	%
Changes in valuation allowance	37,622		(24.24)	%
Non-taxable or nondeductible items
Stock compensation	773		(0.50)	%
Change in fair market value of contingent value right	(6,251)		4.03	%
Limitation on officers' compensation	2,860		(1.84)	%
Permanent and other items	114		(0.07)	%
Other
Other	10		(0.01)	%
Stock based compensation - deferred only	(2,524)		1.63	%
Provision / (benefit) for income taxes	$	(15)	0.01	%

As disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the difference between the Company's provision for income taxes and the amounts computed by applying the statutory federal income tax rate to income before income taxes is as follows (in thousands):

	Year Ended December 31,
	2024		2023
Tax provision derived by applying the federal statutory rate to income before income taxes	$	(43,673)	$	(71,151)
Loss on forward contract valuation	—		17,541
Acquired IPR&D	—		27,340
Loss on CVR revaluation	4,290		3,987
Other permanent differences	1,865		4,472
Federal tax credits	(91)		(1)
Effect of tax rate on foreign jurisdiction	(2)		(53)
Other, net	191		—
Change in the valuation allowance	37,471		17,839
Income tax (benefit) expense	$	51	$	(26)

The amounts of cash income taxes paid by the company are as follows:

	Year Ended December 31, 2025
Federal	$	—
State	—
Foreign	(15)
Total	$	(15)

The components of the deferred tax assets and liabilities consist of the following (in thousands):

	December 31,
	2025		2024		2023
Deferred tax assets
Net operating loss carryforward	$	118,511	$	87,321	$	74,454
Capitalized 174 R&D costs	44,465		45,531		22,532
Intangible assets	4,070		2,117		47
Accrued expense	1,625		1,047		579
Stock-based compensation	12,943		7,114		4,246
Federal tax credits	18,196		18,196		21,914
State tax credits	1,631		1,631		1,631
Other	87		64		88
Total deferred tax assets	201,528		163,021		125,491
Deferred tax liabilities
Unrealized gain	(183)		(92)		—
Total deferred tax liabilities	(183)		(92)		—
Less: Valuation allowance	(201,345)		(162,929)		(125,491)
Deferred tax assets, net	$	—	$	—	$	—

The Company has established a full federal and state valuation allowance equal to the net deferred tax assets due to uncertainties regarding the realization of the deferred tax asset based on the Company’s lack of earnings history. The valuation allowance increased by $38.4 million, $37.4 million, and $17.8 million during the years ended December 31, 2025, 2024, and 2023, respectively, primarily due to continuing loss from operations.

As of December 31, 2025 and 2024, the Company had U.S. net operating loss carryforwards (“NOL”) of $560.1 million and $415.8 million, respectively.

For the year ended December 31, 2025, the Company had U.S. tax credit carryforwards and state tax credit carryforwards of $18.2 million and $2.1 million, respectively. Of the net operating loss and tax credit carryforwards $58.4 million and $20.3 million will begin to expire in 2033 and 2034, respectively.

For the year ended December 31, 2024, the Company had U.S. tax credit carryforwards and state tax credit carryforwards of $18.2 million and $2.1 million, respectively. Of the net operating loss and tax credit carryforwards $58.4 million and $20.3 million will begin to expire in 2033 and 2034, respectively, if not utilized. Any remaining net operating loss will carry forward indefinitely and can be utilized to offset up to 80% of the taxable income in any tax year. The net operating loss and credit carryforwards are subject to Internal Revenue Service adjustments until the statute closes on the year the net operating loss or tax credits are utilized.

The Company has not completed a study to assess whether an ownership change has occurred or whether there have been multiple ownership changes since the Company’s formation due to the complexity and cost associated with such a study, and the fact that there may be additional such ownership changes in the future. If the Company has experienced an ownership change at any time since its formation, utilization of the NOL or research and development credit carryforwards would be subject to an annual limitation under Section 382 or 383 of the Internal Revenue Code, which is determined by first multiplying the value of the Company’s stock at the time of the ownership change by the applicable long-term, tax-exempt rate, and then could be subject to additional adjustments, as required. Additionally, the separate return limitation year (“SRLY”) rules may apply to losses of the Company’s eight wholly owned U.S. subsidiary corporations that have now been merged with the parent company. The SRLY rules limit the consolidated group’s use of a subsidiary corporation’s net operating losses to the amount of income generated by the subsidiary corporation after it becomes a member of the group. Any limitation may result in expiration of a portion of the NOL or research and development credit carryforwards before utilization. Further, until a study is completed and any limitation known, no amounts are being considered as an uncertain tax position or disclosed as an unrecognized tax benefit.

Additionally, the Company does not expect any unrecognized tax benefits to change significantly over the next twelve months. Due to the existence of the valuation allowance, future changes in the Company’s unrecognized tax benefits will not impact its effective tax rate. Any carryforwards that will expire prior to utilization as a result of such limitations will be removed from deferred tax assets with a corresponding reduction of the valuation allowance.

The Company is subject to examination by taxing authorities in its significant jurisdictions for the year ended 2021 and subsequent years. However, due to NOL and tax attribute carryovers, the taxing authorities have the ability to adjust the NOLs and other tax attributes related to closed years. As of December 31, 2025 and 2024, there were no amounts recorded for uncertain tax positions. As of December 31, 2025, undistributed earnings of the Company’s incorporated foreign subsidiaries are immaterial. Under the Global Intangible Low-Taxed Income (“GILTI”) provisions of the 2017 Tax Cuts and Jobs Act, U.S. income taxes have been incurred on the undistributed earnings of the foreign subsidiaries and therefore, the tax impact upon distribution is limited to state income and withholding taxes and is not material.