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ASSEMBLY BIOSCIENCES, INC.

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Business Summary

Assembly Biosciences, Inc. (the "Company") operates in the biotechnology industry, focusing on developing innovative therapeutics for serious viral diseases . The Company's business model is centered on discovering, developing, and advancing next-generation therapeutics to address high unmet medical needs with significant market opportunities . Revenue generation primarily stems from collaboration agreements, such as the one with Gilead Sciences, Inc. (Gilead), which involves upfront payments, milestone payments, and potential royalties or profit-sharing arrangements, rather than product sales . The primary customer segment for its licensed programs is its collaboration partner, Gilead.

The Company's pipeline includes multiple clinical-stage investigational therapies. For recurrent genital herpes, the Company is developing two long-acting helicase-primase inhibitors (HPIs), ABI-1179 (1179) and ABI-5366 (5366) . In December 2025, Gilead exercised its option to exclusively license the HPI program, including 1179 and 5366, for which the Company received a $35.0 million payment . The Company also has an orally bioavailable hepatitis delta virus (HDV) entry inhibitor, ABI-6250 (6250), with Phase 2 initiation expected in the fourth quarter of 2026 . For hepatitis B virus (HBV), the Company is developing a highly potent next-generation capsid assembly modulator (CAM), ABI-4334 (4334), and is currently evaluating partnering opportunities for this program . Additionally, the pipeline includes a novel, oral broad-spectrum non-nucleoside polymerase inhibitor (NNPI), ABI-7272 (7272), for transplant-related herpesviruses, which is undergoing studies to enable a regulatory filing . The Company also maintains additional research programs against multiple antiviral targets .

For the fiscal year ended December 31, 2025, the Company reported collaboration revenue of $72.303 million . Total operating expenses were $84.421 million, comprising $64.813 million in research and development expenses and $19.608 million in general and administrative expenses . The Company incurred a loss from operations of $12.118 million . Interest and other income, net, amounted to $5.996 million . The net loss for the period was $6.122 million, resulting in a basic and diluted EPS of $(0.55) . As of December 31, 2025, cash and cash equivalents totaled $58.450 million, and marketable securities were $189.656 million, leading to a total of $248.106 million in cash, cash equivalents, and marketable securities . The Company reported an accumulated deficit of $832.047 million .

Comparing the fiscal year 2025 to 2024, collaboration revenue increased by $43.783 million, or 154%, from $28.520 million in 2024 to $72.303 million in 2025 . This increase was primarily due to the $35.0 million revenue recognition from the exclusive license granted to Gilead for the HPI program in December 2025, and the recognition of the additional $10.0 million payment received in December 2024 under the First Amendment to the Gilead Collaboration Agreement . Total research and development expenses increased by $8.880 million, or 16%, from $55.933 million in 2024 to $64.813 million in 2025 . This was mainly driven by higher external program expenses for the HPI program, with increased participant enrollment in the 1179 and 5366 Phase 1a/b studies, and a $2.1 million increase in employee and contractor-related compensation costs, along with $1.1 million higher stock-based compensation expense . General and administrative expenses increased by $1.601 million, or 9%, from $18.007 million in 2024 to $19.608 million in 2025, primarily due to $1.2 million in higher professional fees for patent filings and a $0.5 million increase in stock-based compensation expense . Net cash used in operating activities decreased from $51.117 million in 2024 to $41.093 million in 2025, primarily due to $25.2 million more cash received under the Gilead Collaboration Agreement in 2025 . Net cash provided by financing activities significantly increased from $29.449 million in 2024 to $174.667 million in 2025, driven by $166.4 million in net proceeds from the August 2025 financing and subsequent warrant exercises .

In terms of significant operational developments, 2025 was a pivotal year with positive data readouts for 5366, 1179, 4334, and 6250 . In February 2025, 1179 showed positive Phase 1a interim results, followed by positive Phase 1b interim results in December 2025, demonstrating a 98% reduction in HSV-2 shedding rate with a 50 mg weekly dose . For 5366, positive Phase 1b interim results were reported in August 2025 from weekly dosing cohorts, showing a 94% reduction in HSV-2 shedding rate with a 350 mg weekly dose, and further positive interim results from monthly dosing cohorts in December 2025, with a 76% reduction in HSV-2 shedding rate . 4334 reported positive Phase 1b topline results in June 2025, with mean declines in HBV DNA of 2.9 log10 IU/mL and 3.2 log10 IU/mL over 28 days for 150 mg and 400 mg cohorts, respectively . 6250 announced positive Phase 1a interim results in August 2025, supporting once-daily oral dosing . In December 2024, ABI-7423 was nominated as a development candidate for transplant-associated herpesviruses, which transitioned to its parent molecule, 7272, in October 2025, and is now in regulatory filing-enabling nonclinical studies . The Company also entered into a letter agreement with Gilead in July 2025 for reimbursement of up to $1.5 million for certain nonclinical study activities .

Business Outlook

The Company anticipates Gilead will initiate a Phase 2 clinical study for the HPI program in 2026 . The Company expects to receive Gilead’s development plan and budget for the HPI program and make its decision regarding the Profit-Share by mid-2026 .

For the HDV program, the Company is preparing for Phase 2 clinical studies of 6250, with initiation expected in the fourth quarter of 2026 . The 6250 Phase 1a data will be presented at the European Association for the Study of the Liver (EASL) Congress in May 2026 .

Regarding the HBV program, Gilead declined to exercise its option to license 4334 or defer its option until completion of Phase 2 studies in March 2026 . As a result, the Company retains full control of 4334 and is actively evaluating partnering opportunities for the program, with no plans to advance 4334 further without a partner .

For transplant-associated herpesviruses, the Company is advancing 7272, its oral broad-spectrum NNPI, through nonclinical studies to enable a regulatory filing . The research team will continue to leverage its expertise to identify and nominate new viral targets and novel compounds to address significant unmet medical needs .

The Company expects its future operating expenses to increase over the coming years as it continues to expand its pipeline and advance its candidates . The Company monitors its cash needs and the status of the capital markets on a continuous basis and expects to continue to raise capital when and as needed .

The Company believes it has sufficient funds to meet its operating requirements into 2028, based on its current operating plan . This estimate is based on assumptions that may prove to be wrong, and available capital resources may be utilized sooner than currently expected . The Company's contractual obligations include operating lease obligations totaling $3.2 million as of December 31, 2025, of which $0.8 million are short-term .

Risk Factors

The Company faces several material risks, including the inherent uncertainty of product development, as it has no approved products and depends on the future success of its research and development pipeline, which may never achieve regulatory approval or profitability . The collaboration with Gilead is critical, but carries risks such as potential conflicts, failure to receive expected funding, heavy dependence on Gilead for development and commercialization of optioned products, and Gilead's right to develop competing products or decline options, as seen with 4334 . Nonclinical and clinical studies are expensive, time-consuming, and may fail to demonstrate the necessary safety and efficacy, with preliminary data not always reflecting final results . The Company relies on Contract Research Organizations (CROs) and third-party manufacturers, which reduces control over these activities and exposes it to risks such as non-performance, supply chain disruptions, and geopolitical factors, including increased scrutiny or prohibitions on CROs in foreign countries like China . Disruptions at the U.S. Department of Homeland Security, such as the ongoing shutdown, could prevent U.S. Customs and Border Protection from performing normal business functions, leading to delays in clinical studies . Significant disruptions of information technology systems or breaches of data security, including cybersecurity incidents, could materially and adversely affect the business, leading to operational disruptions, theft of confidential information, and potential liabilities under evolving data privacy laws such as the EU GDPR, UK GDPR, CCPA, and CPRA, with non-compliance potentially resulting in fines up to €20 million or 4% of worldwide revenue under EU GDPR . The Company's ability to use its net operating loss and credit carryforwards and certain other tax attributes may be limited due to past and potential future ownership changes under IRC Sections 382 and 383 . The Company is subject to extensive and costly government regulation, and failure to comply with FDA and foreign regulatory requirements, including those related to marketing, pricing, and reimbursement, could lead to sanctions, delays, or withdrawal of approvals . Product liability claims and exposure to hazardous materials also pose significant risks .

Management Priorities

Management's message to shareholders emphasizes the Company's focus on developing innovative therapeutics for serious viral diseases and rapidly advancing its portfolio toward near-term clinical readouts. They highlight 2025 as a pivotal year with positive data readouts for 5366, 1179, 4334, and 6250 . A key strategic priority is the transition of the HPI program, including 5366 and 1179, to Gilead following Gilead's option exercise in December 2025, with the Company expecting to receive Gilead's development plan and budget and make its Profit-Share decision by mid-2026 . Another strategic priority is the advancement of 6250 for HDV, with Phase 2 initiation expected in the fourth quarter of 2026 . Furthermore, management is actively evaluating partnering opportunities for 4334, for which Gilead declined its option, and does not plan to advance it further without a partner . The Company also prioritizes advancing 7272 for transplant-associated herpesviruses through nonclinical studies to enable a regulatory filing and continuing to leverage its research team's expertise to identify new viral targets and novel compounds . Management believes the Company has sufficient funds to meet its operating requirements into 2028 .

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Overview
  2. [2] Item 1, Business — Our Strategy
  3. [3] Item 7, MD&A — Operations
  4. [4] Item 1, Business — Overview
  5. [5] Item 1, Business — Option Exercise
  6. [6] Item 1, Business — Overview
  7. [7] Item 1, Business — Overview
  8. [8] Item 1, Business — Overview
  9. [9] Item 1, Business — Overview
  10. [10] Item 7, MD&A — Collaboration Revenue
  11. [11] Item 7, MD&A — Total operating expenses
  12. [12] Item 7, MD&A — Loss from operations
  13. [13] Item 7, MD&A — Interest and Other Income, Net
  14. [14] Item 7, MD&A — Net loss per share, basic and diluted
  15. [15] Item 7, MD&A — Liquidity and Capital Resources
  16. [16] Item 7, MD&A — Operations
  17. [17] Item 7, MD&A — Collaboration Revenue
  18. [18] Item 7, MD&A — Collaboration Revenue
  19. [19] Item 7, MD&A — Research and Development Expenses
  20. [20] Item 7, MD&A — Research and Development Expenses
  21. [21] Item 7, MD&A — General and Administrative Expenses
  22. [22] Item 7, MD&A — Operating Activities
  23. [23] Item 7, MD&A — Financing Activities
  24. [24] Item 7, MD&A — Our Clinical Programs and Regulatory Filing-Enabling Program
  25. [25] Item 7, MD&A — Recurrent Genital Herpes/HSV-1 and HSV-2
  26. [26] Item 7, MD&A — Recurrent Genital Herpes/HSV-1 and HSV-2
  27. [27] Item 7, MD&A — Capsid Assembly Modulator
  28. [28] Item 7, MD&A — HDV Entry Inhibitor
  29. [29] Item 7, MD&A — Our Clinical Programs and Regulatory Filing-Enabling Program
  30. [30] Item 3, Related Party
  31. [31] Item 7, MD&A — Recurrent Genital Herpes/HSV-1 and HSV-2
  32. [32] Item 7, MD&A — Recurrent Genital Herpes/HSV-1 and HSV-2
  33. [33] Item 7, MD&A — HDV Entry Inhibitor
  34. [34] Item 7, MD&A — HDV Entry Inhibitor
  35. [35] Item 7, MD&A — Capsid Assembly Modulator
  36. [36] Item 7, MD&A — Capsid Assembly Modulator
  37. [37] Item 7, MD&A — Transplant-Associated Herpesviruses
  38. [38] Item 7, MD&A — Research Programs
  39. [39] Item 7, MD&A — Funding Requirements
  40. [40] Item 7, MD&A — Funding Requirements
  41. [41] Item 7, MD&A — Liquidity and Capital Resources
  42. [42] Item 7, MD&A — Funding Requirements
  43. [43] Item 7, MD&A — Funding Requirements
  44. [44] Item 1A, Risk Factors — Risks Related to Our Business
  45. [45] Item 1A, Risk Factors — Risks Related to Our Business
  46. [46] Item 1A, Risk Factors — Risks Related to Our Business
  47. [47] Item 1A, Risk Factors — Risks Related to Our Business
  48. [48] Item 1A, Risk Factors — Risks Related to Our Business
  49. [49] Item 1A, Risk Factors — Risks Related to Our Business
  50. [50] Item 1A, Risk Factors — Risks Related to Our Business
  51. [51] Item 1A, Risk Factors — Risks Related to Our Regulatory and Legal Environment
  52. [52] Item 1A, Risk Factors — Risks Related to Our Regulatory and Legal Environment
  53. [53] Item 7, MD&A — Our Clinical Programs and Regulatory Filing-Enabling Program
  54. [54] Item 7, MD&A — Recurrent Genital Herpes/HSV-1 and HSV-2
  55. [55] Item 7, MD&A — HDV Entry Inhibitor
  56. [56] Item 7, MD&A — Capsid Assembly Modulator
  57. [57] Item 7, MD&A — Transplant-Associated Herpesviruses
  58. [58] Item 7, MD&A — Liquidity and Capital Resources

Analysis on 5/22/2026