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Income Taxes
 12 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
For the years ended December 31, 2025 and 2024, no income tax expense was recorded due to the Company’s net operating loss (“NOL”) and full valuation allowance. The Company’s effective tax rate of zero differs from the U.S. statutory tax rate of 21% primarily because of the valuation allowance maintained against the Company’s net deferred tax assets. A reconciliation of the expected income tax benefit computed using the federal statutory income tax rate to the Company’s effective income tax rate is as follows for the years ended December 31, 2025 and 2024:

20252024
Income tax computed at federal statutory rate$16,886 21%$10,876 21%
Foreign Tax Effects(164)0.20(69)0.13
Effect of Cross-Border Tax Laws231(0.29)——
Non-Deductible Items
Change In Warrant Liability 6,264(7.79)——
Other Adjustments 554(0.69)460(0.89)
Tax Credits(2,280)2.84(1,516)2.93
Changes In Valuation Allowance12,281(15.27)12,001(23.17)
Total Tax Expense $— 0.00%$— 0.00%
The Company’s net deferred tax assets as of December 31, 2025 and 2024, consisted of the following (in thousands):
20252024
Deferred tax assets:
NOLs$33,794 $27,667 
Capitalized R&D costs15,389 22,059 
R&D credits12,269 9,299 
Operating lease liabilities450 2,307 
Capitalized Sec. 59(e) R&D expenditures7,296 1,833 
Cash basis adjustment4,514 1,083 
Other2,534 2,326 
Total gross deferred tax assets76,246 66,574 
Deferred tax liabilities:
Operating lease ROU assets(106)(1,653)
Total gross deferred tax liabilities(106)(1,653)
Net deferred tax assets76,140 64,921 
Valuation allowance(76,140)(64,921)
Net deferred tax asset less valuation allowance$— $— 
As of December 31, 2025 and 2024, the Company had U.S. federal NOL carryforwards of $117.1 million and $102.3 million, respectively, which may be available to offset future income tax liabilities. Of the $117.1 million carryforwards, approximately $4.8 million will begin to expire in 2036 and approximately $112.3 million are carried forward indefinitely. As of December 31, 2025 and 2024, the Company had state NOL carryforwards of $139.2 million and $97.6 million, respectively, which will begin to expire in 2036.
As of December 31, 2025 and 2024, the Company had U.S. federal R&D tax credit carryforwards of $9.0 million and $6.7 million, respectively, which begin to expire in 2036. As of December 31, 2025 and 2024, the Company had state R&D tax credit carryforwards of $4.2 million and $3.3 million, respectively, which begin to expire in 2036. As of December 31, 2025 and 2024, the Company had capitalized R&D costs of $15.4 million and $22.1 million, respectively, as required by the Tax Cuts and Jobs Act of 2017. With the passage of the One Big Beautiful Bill Act, companies are permitted to immediately expense domestic R&D costs. The One Big Beautiful Bill Act still requires the capitalization of Foreign R&D costs, and the Company has continued to capitalize these costs as required.

Future realization of the tax benefits of existing temporary differences and NOL carryforwards ultimately depends on the existence of sufficient taxable income within the carryforward period. As of December 31, 2025, the Company performed an evaluation to determine whether a valuation allowance was needed. The Company considered all available evidence, both positive and negative, which included the results of operations for the current and preceding years. The Company determined that it is more likely than not that all of the deferred tax assets will not be realized. Accordingly, the Company maintained a full valuation allowance as of December 31, 2025. During the years ended December 31, 2025 and 2024, the valuation allowance increased by $11.2 million and $15.3 million, respectively, due to the increase in the deferred tax assets by the same amount, primarily due to increases in the NOL carryforwards, capitalized R&D costs and R&D tax credit carryforwards.
The utilization of NOLs and tax credit carryforwards to offset future taxable income may be subject to an annual limitation because of ownership changes that have occurred previously or may occur in the future. Under Sections 382 and 383 of the Internal Revenue Code of 1986 (“IRC”), a corporation that undergoes an ownership change may be subject to limitation on its ability to utilize its pre-change NOLs and other tax attributes otherwise available to offset future taxable income and/or tax liability. An ownership change is defined as a cumulative change of more than 50% in the ownership positions of certain stockholders during a rolling three-year period.
The Company has not completed a formal study to determine if any ownership changes within the meaning of IRC Section 382 and 383 have occurred as of December 31, 2025. An ownership change would restrict its ability to use its NOLs or tax credit carryforwards and could require the Company to pay U.S. federal or state income taxes earlier than would be required if such limitation were not in effect.
For the year ended December 31, 2025, the Company generated research credits and has conducted a study to document the qualified activities through year end December 31, 2024. This resulted in an overall increase of $1.3 million to the Company’s R&D credit carryforwards and valuation allowance through December 31, 2024.