[10-Q] Zura Bio Ltd Quarterly Earnings Report

Rhea-AI Filing Summary

Zura Bio Limited reported its Q3 2025 results. Cash and cash equivalents were $139.0 million as of September 30, 2025, compared with $176.5 million at year-end 2024. The company recorded a net loss of $18.0 million for the quarter and $51.5 million for the nine months, reflecting ongoing investment in clinical programs.

Quarterly operating expenses were $19.5 million, with research and development at $11.9 million and general and administrative at $7.6 million. Net cash used in operating activities was $42.5 million for the nine months. Management states it should have sufficient liquidity to fund operations over the next twelve months.

The pipeline centers on Phase 2 development of tibulizumab (ZB-106), a dual IL‑17A/BAFF bispecific antibody. During 2025, the company sold 3,000,000 shares under its ATM at $1.75 for $5.1 million in net proceeds. Class A Ordinary Shares outstanding were 65,018,058 as of September 30, 2025, and 65,023,308 as of November 10, 2025.

Insights

Biopharma financial analyst

Solid cash of $139.0M; losses reflect stepped-up R&D.

Zura Bio ended Q3 2025 with $139.0M in cash and cash equivalents. The quarterly net loss of $18.0M stems mainly from R&D at $11.9M, consistent with a clinical-stage push for tibulizumab in Phase 2. G&A was $7.6M, yielding total operating expenses of $19.5M.

Year-to-date operating cash outflow of $42.5M indicates increased spend versus 2024. The company added $5.1M via the ATM and discloses it should have sufficient liquidity for the next twelve months. Obligations include accrued items within accounts payable and accrued expenses of $25.5M.

Key items to track include quarterly cash burn and any updates to the tibulizumab program from Q4 2025 onward. Actual impact will depend on clinical progress and any future financing activity under the shelf/ATM.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 10-Q

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(Mark One)

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☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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For the quarterly period ended September 30, 2025

OR

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☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM               TO            

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Commission File Number 001-40598

ZURA BIO LIMITED

(Exact name of Registrant as specified in its Charter)

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Cayman Islands	98-1725736
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1489 W. Warm Springs Rd. #110 Henderson, NV	89014
(Address of principal executive offices)	(Zip Code)

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Registrant’s telephone number, including area code: (702) 825-9872

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Securities registered pursuant to Section 12(b) of the Act:

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Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A Ordinary Shares	​	ZURA	​	The Nasdaq Stock Market LLC (The Nasdaq Capital Market)

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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Large accelerated filer	☐	Accelerated filer	☐
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Non-accelerated filer	☒	Smaller reporting company	☒
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Emerging growth company	☒	​	​

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

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As of November 10, 2025, the registrant had 65,023,308 Class A Ordinary Shares outstanding

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Table of Contents

Table of Contents

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	​		Page
​	Cautionary Note Regarding Forward-Looking Statements	​	3
PART I	FINANCIAL INFORMATION	​	5
Item 1.	Financial Statements (Unaudited)	​	5
​	Condensed Consolidated Balance Sheets	​	5
​	Condensed Consolidated Statements of Operations	​	6
​	Condensed Consolidated Statements of Changes in Redeemable Noncontrolling Interest and Shareholders’ Equity	​	7
​	Condensed Consolidated Statements of Cash Flows	​	9
​	Notes to Unaudited Condensed Consolidated Financial Statements	​	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	​	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	​	40
Item 4.	Controls and Procedures	​	40
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PART II	OTHER INFORMATION	​	41
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Item 1.	Legal Proceedings	​	41
Item 1A.	Risk Factors	​	41
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	​	49
Item 3.	Defaults Upon Senior Securities	​	49
Item 4.	Mine Safety Disclosures	​	49
Item 5.	Other Information	​	49
Item 6.	Exhibits	​	50
Signatures	​	​	51

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Table of Contents

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this “Quarterly Report”) contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Our forward-looking statements include, but are not limited to, statements regarding our and our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.

These forward-looking statements are based on the current expectations of Zura Bio Limited (the “Company” or “Zura”) and its management and are inherently subject to uncertainties and changes in circumstances and their potential effects and speak only as of the date of such statements. Forward-looking statements are not guarantees of performance. You should not put undue reliance on our forward-looking statements. These forward-looking statements involve a number of risks, uncertainties or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to:

● our expectations regarding our product candidates and their related benefits, and our beliefs regarding competing product candidates and products both in development and approved, may not be achieved;

● our vision and strategy may not be successful;

● the timing of key events and initiation of our studies and release of clinical data may take longer than anticipated or may not be achieved at all;

● expectations regarding the potential general acceptability and maintenance of our product candidates by regulatory authorities, payors, physicians, and patients may not be achieved;

● we may be unable to attract and retain key personnel;

● expectations with respect to our future operating expenses, capital requirements and needs for additional financing may not be achieved;

● we have not completed any clinical trials, and have no products approved for commercial sale;

● we have incurred significant losses since inception, and expect to incur significant losses for the foreseeable future and may not be able to achieve or sustain profitability in the future;

● we require substantial additional capital to finance our operations, and if we are unable to raise such capital when needed or on acceptable terms, we may be forced to delay, reduce, and/or eliminate one or more of our development programs or future commercialization efforts;

● we may be unable to renew existing contracts, enter into new contracts or may experience disputes or other challenges with respect to our vendors or other third-parties;

● we rely on third-party contract development manufacturing organizations for the manufacture of clinical materials;

● we rely on contract research organizations, clinical trial sites, and other third parties to conduct our preclinical studies and clinical trials;

● we may be unable to obtain regulatory approval for our product candidates, and there may be related restrictions or limitations of any approved products;

3

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● we may be unable to successfully respond to general economic and geopolitical conditions;

● we may be unable to effectively manage growth;

● we face competitive pressures from other companies worldwide;

● we may be unable to adequately protect our intellectual property rights; and

● other factors set forth in documents filed, or to be filed, with the Securities and Exchange Commission (the “SEC”).

Additional discussion of the risks, uncertainties and other factors described above, as well as other risks material to our business, can be found under “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”), as supplemented by the risks and uncertainties described in “Risk Factors” Item 1A. Risk Factors in Part II of this Quarterly Report. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements. New risk factors emerge from time to time and it is not possible to predict all such risk factors, nor can we assess the impact of all such risk factors on our business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, investments or other transactions we may execute.

For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with this Quarterly Report and the documents referenced within this Quarterly Report and the other cautionary statements that are included elsewhere in this Quarterly Report and in our public filings, including under “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Forward-looking statements, reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary statements. We undertake no obligations to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

​

​

​

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PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

Zura Bio Limited

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except share data)

​	​	​	​	​	​	​
​		September 30,			December 31,
​	​	2025		​	2024
​	​	(unaudited)		​	​	​
Assets	​	​	​	​	​	​
Current assets		​	​	​	​
Cash and cash equivalents	​	$	139,017	​	$	176,498
Prepaid expenses and other current assets	​	​	3,275	​	​	2,246
Total current assets	​	​	142,292	​	​	178,744
Property and equipment, net	​	​	131	​	​	91
Other assets	​	​	1,512	​	​	698
Total assets	​	$	143,935	​	$	179,533
​	​	​	​	​	​	​
Liabilities, Redeemable Noncontrolling Interest and Shareholders’ Equity	​	​	​	​	​	​
Current liabilities	​	​	​	​	​	​
Accounts payable and accrued expenses	​	$	25,491	​	$	19,514
Total current liabilities	​	​	25,491	​	​	19,514
Total liabilities	​	​	25,491	​	​	19,514
​	​	​	​	​	​	​
Commitments and contingencies (Note 9)	​	​	​	​	​	​
​	​	​	​	​	​	​
Redeemable noncontrolling interest	​	​	8,660	​	​	11,663
​	​	​	​	​	​	​
Shareholders’ Equity	​	​	​	​	​	​
Preferred shares, $0.0001 par value, 1,000,000 shares authorized as of September 30, 2025 and December 31, 2024; no shares issued and outstanding as of September 30, 2025 and December 31, 2024	​	​	—	​	​	—
Class A Ordinary Shares, $0.0001 par value; 300,000,000 shares authorized as of September 30, 2025 and December 31, 2024; 65,018,058 and 65,297,530 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively	​	​	7	​	​	7
Additional paid-in capital	​	​	315,608	​	​	302,705
Accumulated deficit	​	​	(207,372)	​	​	(155,897)
Total Zura Bio Limited shareholders’ equity	​	​	108,243	​	​	146,815
Noncontrolling interest	​	​	1,541	​	​	1,541
Total shareholders’ equity	​	​	109,784	​	​	148,356
Total liabilities, redeemable noncontrolling interest and shareholders’ equity	​	$	143,935	​	$	179,533

​

See accompanying notes to unaudited condensed consolidated financial statements.

​

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Zura Bio Limited

Condensed Consolidated Statements of Operations

(Unaudited)

(In thousands, except share and per share data)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the Three Months Ended

​

For the Nine Months Ended

​

​

September 30,

​

September 30,

​

2025

2024

2025

2024

Operating expenses:

​

​

​

​

​

​

​

​

​

Research and development

​

$

11,948

​

$

6,029

​

$

31,126

​

$

15,161

General and administrative

​

​

7,571

​

​

13,290

​

25,709

​

24,296

Total operating expenses

​

​

19,519

​

​

19,319

​

56,835

​

39,457

Loss from operations

​

​

(19,519)

​

​

(19,319)

​

(56,835)

​

(39,457)

Other (income)/expense, net:

​

​

​

​

​

​

​

​

​

​

​

​

Interest income

​

​

(1,526)

​

​

(2,461)

​

​

(5,060)

​

​

(5,872)

Change in fair value of private placement warrants

​

​

—

​

​

3,866

​

​

—

​

​

5,240

Other expense/(income), net

​

​

47

​

​

(22)

​

​

(300)

​

​

(47)

Total other (income)/expense, net

​

​

(1,479)

​

​

1,383

​

​

(5,360)

​

​

(679)

Loss before income taxes

​

​

(18,040)

​

​

(20,702)

​

​

(51,475)

​

​

(38,778)

Income tax benefit

​

​

—

​

​

—

​

​

—

​

​

—

Net loss

​

​

(18,040)

​

​

(20,702)

​

​

(51,475)

​

​

(38,778)

Accretion of redeemable noncontrolling interest to redemption value

​

​

(2,828)

​

​

(2,240)

​

​

(2,828)

​

​

(4,577)

Adjustment of redeemable noncontrolling interest

​

​

831

​

​

—

​

​

831

​

​

7,017

Net loss attributable to Class A Ordinary Shareholders of Zura

​

$

(20,037)

​

$

(22,942)

​

$

(53,472)

​

$

(36,338)

Net loss per share attributable to Class A Ordinary Shareholders of Zura, basic and diluted

​

$

(0.21)

​

$

(0.26)

​

$

(0.57)

​

$

(0.52)

Weighted-average Class A Ordinary Shares used in computing net loss per share attributable to Class A Ordinary Shareholders of Zura, basic and diluted

​

​

94,564,632

​

​

87,335,667

​

93,941,675

​

69,778,401

​

See accompanying notes to unaudited condensed consolidated financial statements.

​

​

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Zura Bio Limited

Condensed Consolidated Statements of Changes in Redeemable Noncontrolling Interest and Shareholders’ Equity

(Unaudited)

(In thousands, except share data)

For the Three Months Ended September 30, 2025

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Redeemable

Class A

Additional

​

​

​

​

​

Total

​

​

Noncontrolling

​

​

Ordinary Shares

​

Paid-in

​

Accumulated

​

Noncontrolling

​

Shareholders’

​

Interest

Shares

Amount

Capital

Deficit

Interest

Equity

Balance as of June 30, 2025

​

$

11,663

​

62,064,270

​

$

6

​

$

315,231

​

$

(189,332)

​

$

1,541

​

$

127,446

Issuance of Class A Ordinary Shares upon exercise of Pre-Funded Warrants

​

—

​

2,888,952

​

​

1

​

​

2

​

​

—

​

​

—

​

​

3

Issuance of Class A Ordinary Shares for restricted share units, net of shares withheld for taxes

​

​

—

​

​

64,836

​

​

—

​

​

(7)

​

​

—

​

​

—

​

​

(7)

Partial extinguishment of redeemable noncontrolling interest

​

​

(5,831)

​

​

—

​

​

—

​

​

831

​

​

—

​

​

—

​

​

831

Accretion of redeemable noncontrolling interest to redemption value

​

​

2,828

​

​

—

​

​

—

​

​

(2,828)

​

​

—

​

​

—

​

​

(2,828)

Share-based compensation

​

​

—

​

​

—

​

​

—

​

​

2,379

​

​

—

​

​

—

​

​

2,379

Net loss

​

—

​

—

​

​

—

​

​

—

​

​

(18,040)

​

​

—

​

​

(18,040)

Balance as of September 30, 2025

​

$

8,660

​

65,018,058

​

$

7

​

$

315,608

​

$

(207,372)

​

$

1,541

​

$

109,784

​

For the Three Months Ended September 30, 2024

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Redeemable

Class A

Additional

​

​

​

​

​

Total

​

​

Noncontrolling

​

​

Ordinary Shares

​

Paid-in

​

Accumulated

​

Noncontrolling

​

Shareholders’

​

Interest

Shares

Amount

Capital

Deficit

Interest

Equity

Balance as of June 30, 2024

​

$

14,000

​

63,683,806

​

$

6

​

$

278,086

​

$

(121,570)

​

$

1,541

​

$

158,063

Issuance of Pre-Funded Warrants in exchange for Class A Ordinary Shares

​

​

—

​

​

(4,000,000)

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Issuance of Class A Ordinary Shares in exchange for Private Placement Warrants

​

—

​

1,718,108

​

​

—

​

​

6,230

​

​

—

​

​

—

​

​

6,230

Issuance of Class A Ordinary Shares in exchange for Public Warrants

​

—

​

2,064,082

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Issuance of Class A Ordinary Shares in connection with a sale under the ATM, net of $0.2 million of commissions

​

​

—

​

​

1,500,000

​

​

1

​

​

5,533

​

​

—

​

​

—

​

​

5,534

ATM transaction costs

​

​

—

​

​

—

​

​

—

​

​

(626)

​

​

—

​

​

—

​

​

(626)

Issuance of Class A Ordinary Shares for restricted share units, net of shares withheld for taxes

​

​

—

​

​

327,534

​

​

—

​

​

(318)

​

​

—

​

​

—

​

​

(318)

Share-based compensation

​

​

—

​

​

—

​

​

—

​

​

8,646

​

​

—

​

​

—

​

​

8,646

Accretion of redeemable noncontrolling interest to redemption value

​

​

2,240

​

​

—

​

​

—

​

​

(2,240)

​

​

—

​

​

—

​

​

(2,240)

Net loss

​

​

—

​

​

—

​

​

—

​

​

—

​

​

(20,702)

​

​

—

​

​

(20,702)

Balance as of September 30, 2024

​

$

16,240

​

​

65,293,530

​

$

7

​

$

295,311

​

$

(142,272)

​

$

1,541

​

$

154,287

​

See accompanying notes to unaudited condensed consolidated financial statements.

​

7

Table of Contents

Zura Bio Limited

Condensed Consolidated Statements of Changes in Redeemable Noncontrolling Interest and Shareholders’ Equity

(Unaudited)

(In thousands, except share data)

​

For the Nine Months Ended September 30, 2025

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Redeemable

​

​

Class A

​

Additional

​

​

​

​

​

​

Total

​

​

Noncontrolling

​

​

Ordinary Shares

​

Paid-in

​

Accumulated

​

Noncontrolling

​

Shareholders’

​

Interest

Shares

Amount

Capital

Deficit

Interest

Equity

Balance as of December 31, 2024

$

11,663

​

65,297,530

​

$

7

​

$

302,705

​

$

(155,897)

​

$

1,541

​

$

148,356

Issuance of Class A Ordinary Shares in connection with sales under the ATM, net of $0.2 million of commissions

​

​

—

​

​

3,000,000

​

​

—

​

​

5,093

​

​

—

​

​

—

​

​

5,093

Issuance of Pre-Funded Warrants in exchange for Class A Ordinary Shares

​

​

—

​

​

(6,500,000)

​

​

(1)

​

​

1

​

​

—

​

​

—

​

​

—

Issuance of Class A Ordinary Shares upon exercise of Pre-Funded Warrants

​

​

—

​

​

2,888,952

​

​

1

​

​

2

​

​

—

​

​

—

​

​

3

Issuance of Class A Ordinary Shares for share option exercises and restricted share units, net of shares withheld for taxes

​

—

​

331,576

​

​

—

​

​

49

​

​

—

​

​

—

​

​

49

Partial extinguishment of redeemable noncontrolling interest

​

​

(5,831)

​

​

—

​

​

—

​

​

831

​

​

—

​

​

—

​

​

831

Accretion of redeemable noncontrolling interest to redemption value

​

2,828

​

—

​

​

—

​

​

(2,828)

​

​

—

​

​

—

​

​

(2,828)

Share-based compensation

​

—

​

—

​

​

—

​

​

9,755

​

​

—

​

​

—

​

​

9,755

Net loss

​

​

—

​

​

—

​

​

—

​

​

—

​

​

(51,475)

​

​

—

​

​

(51,475)

Balance as of September 30, 2025

​

$

8,660

​

​

65,018,058

​

$

7

​

$

315,608

​

$

(207,372)

​

$

1,541

​

$

109,784

​

For the Nine Months Ended September 30, 2024

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Redeemable

​

​

Class A

​

Additional

​

​

​

​

​

​

​

Total

​

​

Noncontrolling

​

​

Ordinary Shares

​

Paid-in

​

Accumulated

​

Noncontrolling

​

Shareholders’

​

Interest

Shares

Amount

Capital

Deficit

Interest

Equity

Balance as of December 31, 2023

​

$

18,680

​

​

43,593,678

​

$

4

​

$

162,820

​

$

(103,494)

​

$

1,541

​

$

60,871

Issuance of Class A Ordinary Shares in connection with April 2024 Private Placement, net of $7.2 million of transaction costs

​

​

—

​

​

20,090,128

​

​

2

​

​

55,221

​

​

—

​

​

—

​

​

55,223

Issuance of Pre-Funded Warrants in connection with April 2024 Private Placement

​

​

—

​

​

—

​

​

—

​

​

50,030

​

​

—

​

​

—

​

​

50,030

Issuance of Pre-Funded Warrants in exchange for Class A Ordinary Shares

​

​

—

​

​

(4,000,000)

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Issuance of Class A Ordinary Shares in exchange for Private Placement Warrants

​

​

—

​

​

1,718,108

​

​

—

​

​

6,230

​

​

—

​

​

—

​

​

6,230

Issuance of Class A Ordinary Shares in exchange for Public Warrants

​

​

—

​

​

2,064,082

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Issuance of Class A Ordinary Shares in connection with sales under the ATM, net of $0.2 million of commissions

​

—

​

​

1,500,000

​

​

1

​

​

5,533

​

​

—

​

​

—

​

​

5,534

ATM transaction costs

​

—

​

​

—

​

​

—

​

​

(626)

​

​

—

​

​

—

​

​

(626)

Issuance of Class A Ordinary Shares for restricted share units, net of shares withheld for taxes

​

​

—

​

​

327,534

​

​

—

​

​

(318)

​

​

—

​

​

—

​

​

(318)

Share-based compensation

​

​

—

​

​

—

​

​

—

​

​

13,981

​

​

—

​

​

—

​

​

13,981

Adjustment of redeemable noncontrolling interest from redemption value to carrying value

​

​

(7,017)

​

​

—

​

​

—

​

​

7,017

​

​

—

​

​

—

​

​

7,017

Accretion of redeemable noncontrolling interest to redemption value

​

​

4,577

​

​

—

​

​

—

​

​

(4,577)

​

​

—

​

​

—

​

​

(4,577)

Net loss

​

​

—

​

​

—

​

​

—

​

​

—

​

​

(38,778)

​

​

—

​

​

(38,778)

Balance as of September 30, 2024

​

$

16,240

​

65,293,530

​

$

7

​

$

295,311

​

$

(142,272)

​

$

1,541

​

$

154,287

​

See accompanying notes to unaudited condensed consolidated financial statements.

​

8

Table of Contents

Zura Bio Limited

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

​	​	​	​	​	​	​
​	​	For the Nine Months Ended September 30,
​		2025			2024
Cash flows from operating activities	​	​	​	​	​
Net loss	​	$	(51,475)	​	$	(38,778)
Adjustments to reconcile net loss before redeemable noncontrolling interest to net cash used in operating activities	​	​	​	​	​	​
Share-based compensation expense	​	​	9,755	​	​	13,981
Change in fair value of private placement warrants	​	​	—	​	​	5,240
Depreciation and amortization	​	​	34	​	​	4
Foreign exchange transaction loss (gain)	​	​	73	​	​	(31)
Changes in operating assets and liabilities:	​	​	​	​	​	​
Prepaid expenses and other current assets	​	​	(1,029)	​	​	283
Other assets	​	​	(814)	​	​	—
Accounts payable and accrued expenses	​	​	919	​	​	2,049
Net cash used in operating activities	​	​	(42,537)	​	​	(17,252)
Cash flows from investing activities	​	​	​	​	​	​
Purchase of property and equipment	​	​	(96)	​	​	(30)
Purchase of research and development license	​	​	—	​	​	(5,000)
Net cash used in investing activities	​	​	(96)	​	​	(5,030)
Cash flows from financing activities	​	​	​	​	​	​
Proceeds from issuance of Class A Ordinary Shares in connection with a sale under the ATM, net of $0.2 million of commissions	​	​	5,093	​	​	5,534
Proceeds from exercise of share options	​	​	90	​	​	—
Proceeds from exercise of Pre-Funded Warrants	​	​	3	​	​	—
Payment of employee withholding taxes for restricted share units withheld	​	​	(34)	​	​	—
Proceeds from issuance of Class A Ordinary Shares in connection with April 2024 Private Placement, net of $7.2 million of transaction costs	​	​	—	​	​	55,223
Proceeds from issuance of Pre-Funded Warrants in connection with April 2024 Private Placement	​	​	—	​	​	50,030
ATM transaction costs	​	​	—	​	​	(38)
Payment of deferred transaction costs	​	​	—	​	​	(52)
Net cash provided by financing activities	​	​	5,152	​	​	110,697
Net (decrease) increase in cash and cash equivalents	​	​	(37,481)	​	​	88,415
Cash and cash equivalents, beginning of period	​	​	176,498	​	​	99,806
Cash and cash equivalents, ending of period	​	$	139,017	​	$	188,221
​	​	​	​	​	​	​
Supplemental Disclosure	​	​	​	​	​	​
Cash paid for taxes	​	$	—	​	$	—
Cash paid for interest	​	$	—	​	$	—
​	​	​	​	​	​	​
Supplemental Disclosure of Non-Cash Investing and Financing Activities	​	​	​	​	​	​
Partial extinguishment of redeemable noncontrolling interest	​	$	5,831	​	$	—
Accretion of redeemable noncontrolling interest to redemption value	​	$	2,828	​	$	4,577
Issuance of Class A Ordinary Shares in exchange for private placement warrants	​	$	—	​	$	6,230
Unpaid ATM transaction costs included in accounts payable and accrued expenses	​	$	—	​	$	588
Restricted share units withheld to pay employee withholding taxes that are included in accounts payable and accrued expenses	​	$	7	​	$	318
Adjustment of redeemable noncontrolling interest from redemption value to carrying value	​	$	—	​	$	7,017
Purchase of property and equipment included in accounts payable and accrued expenses	​	$	3	​	$	18

​

See accompanying notes to unaudited condensed consolidated financial statements.

​

​

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Zura Bio Limited

Notes to Unaudited Condensed Consolidated Financial Statements

1. Organization and Description of Business

Zura Bio Limited, a Cayman Islands exempted company, formerly known as JATT Acquisition Corp (“JATT”), together with its subsidiaries (collectively, the “Company” or “Zura”), is a clinical-stage, multi-asset immunology company dedicated to developing novel dual-pathway antibodies for a range of autoimmune and inflammatory diseases with unmet needs.

The Company’s strategic focus is to leverage dual-pathway biology to develop therapies intended to provide broader and deeper clinical benefits for patients with immune-mediated conditions. The Company currently has one clinical-stage product candidate in ongoing Phase 2 trials and is continuing to evaluate additional development opportunities within its pipeline, focusing on indications with unmet need and commercial potential.

The Company’s lead product candidate, tibulizumab (ZB-106), is an immunoglobulin G (“IgG”)-single-chain variable fragment (“scFv”) bispecific dual-antagonist antibody engineered by the fusion of TALTZ® (ixekizumab) and tabalumab to neutralize interleukin-17A (IL-17A) and B-cell activating factor (BAFF).

● In May 2025, the Company initiated TibuSHIELD, a global randomized, double-blind, placebo-controlled Phase 2 clinical study evaluating tibulizumab in approximately 180 adults with moderate to severe hidradenitis suppurativa (HS). The trial is designed to assess the safety, tolerability, and efficacy of tibulizumab for the treatment of HS in this patient population.

● In December 2024, the Company initiated TibuSURE, a global randomized, double-blind, placebo-controlled Phase 2 study evaluating tibulizumab in approximately 80 adults with early diffuse cutaneous systemic sclerosis (dcSSc). The trial is designed to assess the safety, tolerability, and efficacy of tibulizumab for the treatment of dcSSc in this patient population.

Additionally, the Company is actively assessing the competitive landscape and evaluating potential therapeutic indications for crebankitug and torudokimab.

● Crebankitug (ZB-168) is a fully human, high affinity monoclonal antibody that binds and neutralizes the interleukin-7 receptor (IL-7R) alpha chain. IL-7Rα sits at the nexus of two key immune pathways, IL-7 and thymic stromal lymphopoietin (“TSLP”), thus IL-7Rα has the potential to block activation through either of these pathways. As a result, the Company believes crebankitug could be therapeutically relevant in a broad set of indications where the IL-7 or TSLP pathways may be involved.

● Torudokimab (ZB-880) is a fully human, high affinity monoclonal antibody that neutralizes interleukin-33 (“IL-33”), thereby inhibiting ST2-dependent inflammatory signaling and potentially modulating ST2-independent pathways, such as those mediated by the receptor for advanced glycation end products (“RAGE”). The IL-33/ST2 axis is supported by genetic evidence and is being investigated as a therapeutic target in inflammatory diseases, with development programs in asthma and ongoing evaluation in chronic obstructive pulmonary disease (“COPD”).

Business Combination

On March 20, 2023 (the “Closing Date”), the Company consummated the previously announced business combination (the “Business Combination”), pursuant to the terms of a business combination agreement (the “Business Combination Agreement”), dated as of June 16, 2022 (as amended on September 20, 2022, November 14, 2022, and January 13, 2023), by and among JATT, JATT Merger Sub, JATT Merger Sub 2, Zura Bio Holdings Ltd. (“Holdco”), and Zura Bio Limited, a limited company incorporated under the laws of England and Wales (“Legacy Zura”). Pursuant to the Business Combination Agreement, (a) before the closing of the Business Combination, Holdco was established as a new holding company of Legacy Zura and became a party to the Business Combination Agreement; and (b) on the Closing Date, in sequential order: (i) Merger Sub merged with and into Holdco, with Holdco continuing as the surviving company and a wholly owned subsidiary of JATT; (ii) immediately following the Merger, Holdco merged with and into Merger Sub 2, with Merger Sub 2 continuing as the surviving company and a wholly owned subsidiary of JATT; and (iii) JATT changed its name to “Zura Bio Limited”.

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Prior to the Business Combination, JATT’s public shares, public warrants, and public units were listed on the New York Stock Exchange (“NYSE”) under the symbols “JATT,” “JATT.WS,” and “JATT.U,” respectively. On March 20, 2023, the Company’s Class A ordinary shares (“Class A Ordinary Shares”) and public warrants began trading on the Nasdaq Stock Market (“Nasdaq”) under the symbols “ZURA” and “ZURAW,” respectively. As of August 27, 2024, the Public Warrants (as defined herein) were no longer listed on the Nasdaq in connection with the completion of the Warrant Exchange (as defined herein). See Note 7.

Emerging Growth Company Status

The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The Company has elected to use the extended transition period for complying with new or revised accounting standards, and as a result of this election, the Company’s unaudited condensed consolidated financial statements (the “condensed consolidated financial statements”) may not be comparable to companies that comply with public company Financial Accounting Standards Board (“FASB”) standards’ effective dates. The Company may take advantage of these exemptions up until the last day of the fiscal year following the fifth anniversary of an offering or such earlier time that it is no longer an emerging growth company. The Company expects to no longer be an emerging growth company effective December 31, 2026.

Liquidity

The Company has incurred operating losses since inception and expects to continue to incur significant operating losses for the foreseeable future and may never become profitable. The Company has an accumulated deficit of $207.4 million and $155.9 million as of September 30, 2025 and December 31, 2024, respectively, and a net loss of $18.0 million and $51.5 million for the three and nine months ended September 30, 2025, respectively. The Company’s existing sources of liquidity as of September 30, 2025 include $139.0 million in cash and cash equivalents.

Prior to the Business Combination, the Company historically funded operations primarily with issuances of convertible preferred shares and a promissory note. Upon the closing of the Business Combination, the Company received $56.7 million in net cash proceeds. Additionally, the Company raised (a) $10.6 million of cash proceeds after sales agent commissions in connection with sales under the ATM (as defined herein) since September 2024, (b) an aggregate of $105.3 million of net cash proceeds from the sale of Class A Ordinary Shares and pre-funded warrants in April 2024 (the “April 2024 Private Placement”), and (c) $75.8 million in net cash proceeds from the sale of Class A Ordinary Shares and pre-funded warrants in May and June 2023 (the “April 2023 Private Placement”). The Company’s cash requirements include, but are not limited to, clinical development, product manufacturing costs and working capital requirements. The Company expects that such operating losses and negative cash flows from operations will continue, but that it should have sufficient liquidity to fund its operations over the next twelve months.

2. Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The Company’s condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) applicable to interim financial statements and include the accounts of its consolidated subsidiaries. Other shareholders’ interests in the Company’s subsidiaries, Z33 Bio, Inc. (“Z33”) and ZB17 LLC (“ZB17”), are shown in the condensed consolidated financial statements as redeemable noncontrolling interest and noncontrolling interest, respectively. All intercompany balances and transactions have been eliminated in consolidation.

These condensed consolidated financial statements are presented in accordance with the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (“SEC”) and do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with U.S. GAAP. As such, the information included herein should be read in conjunction with the Company’s consolidated financial statements and accompanying notes as of and for the year ended December 31, 2024 (the “audited consolidated financial statements”) that were included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 25, 2025 (the “Annual Report”). In Management’s opinion, these unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and reflect all adjustments, which include normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of September 30, 2025 and the results of operations for the three and nine months ended September 30, 2025 and 2024. The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of the results to be expected for the full year ending December 31, 2025 or any other future interim or annual period.

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Significant Accounting Policies

Except for the addition of Research and Development (“R&D”) incentive credits, there have been no significant changes in the Company’s significant accounting policies from those that were disclosed in Note 2, Summary of Significant Accounting Policies, included in the Company’s consolidated financial statements in the Company’s Annual Report.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. Significant estimates and assumptions reflected in the condensed consolidated financial statements relate to and include, but are not limited to, the fair value of share-based compensation, the fair value of redeemable noncontrolling interest, the valuation allowance of deferred tax assets resulting from net operating losses and the fair value of the private placement warrants.

Risks and Uncertainties

The Company is subject to risks common to early-stage companies in the biotechnology industry, including, but not limited to, development by the Company or its competitors of technological innovations, risks of failure of clinical studies, dependence on key personnel, protection of proprietary technology, compliance with government regulations, and ability to transition from clinical manufacturing to commercial production of products.

The Company’s product candidates will require approvals from the United States Food and Drug Administration (“FDA”) and comparable foreign regulatory agencies prior to commercial sales in their respective jurisdictions. There can be no assurance that any product candidates will receive the necessary approvals. If the Company was denied approval, approval was delayed or the Company was unable to maintain approval for any product candidate, it could have a material adverse impact on the Company.

The Company has significant cash balances at financial institutions which throughout the year regularly exceed the federally insured limit of $250,000. Any loss incurred or a lack of access to such funds could have a significant adverse impact on the Company’s financial condition, results of operations, and cash flows.

Segments

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker (“CODM”) in making decisions regarding resource allocation and assessing performance. The Company’s CODM is the Chief Executive Officer or, when applicable, the Interim Chief Executive Officer. The Company and the CODM view its operations and manage its business as one operating segment, focused on developing novel medicines for immune and inflammatory disorders. The Company has business activities in different regions that are managed on a consolidated basis.

The accounting policies of the Company’s segment are the same as those described within this footnote. The CODM uses net loss, that is reported in the condensed consolidated statements of operations to assess performance for the Company’s segment and decide how to allocate resources. The significant expenses within net loss are separately presented in the Company’s condensed consolidated statement of operations. The CODM monitors budget versus actual results using operating loss which is a component of net loss. The measure of segment assets is reported on the condensed consolidated balance sheet as total consolidated assets.

R&D Incentive Credits

The Company is eligible to obtain certain R&D incentive credits (the “R&D Credits”), through participation in the United Kingdom’s (“U.K.”) R&D Small and Medium Enterprise (“SME”) and the Research and Development Expenditure Credit (“RDEC”) tax relief programs.

The R&D Credits are calculated as a percentage of qualifying R&D expenses incurred as part of research projects. The R&D Credits are used as tax credits for the Company with the resulting amount being payable in cash by the U.K. government (tax authority) to the Company. The R&D Credits are subject to future audits by the U.K. tax authority within defined periods.

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Although the incentive credits are administered through the local tax authority, the Company has accounted for the incentives outside of the scope of FASB Accounting Standards Codification Topic 740, Income Taxes (“ASC 740”), since the incentives are not linked to the Company’s taxable income and can be realized regardless of whether the Company has generated taxable income in the respective jurisdictions. The Company accounts for these incentive credits as a government grant which analogizes with International Accounting Standards 20 (“IAS 20”), Accounting for Government Grants and Disclosure of Government Assistance.

In accordance with IAS 20, the Company will recognize the R&D Credits when it has reasonable assurance that the R&D Credits will be received. As the Company has only filed two claims under the tax relief programs as of September 30, 2025, it has determined that reasonable assurance will be met upon cash receipt. For the three and nine months ended September 30, 2025, the Company recorded $0.3 million in other income, net in the condensed consolidated statement of operations for R&D Credits received in May 2025. In April 2025, the Company filed an additional claim for an R&D Credit for $1.0 million that was not received as of September 30, 2025.

Net Loss Per Share

Basic net loss per share is computed by dividing net loss attributable to Class A Ordinary Shareholders by the weighted-average number of Class A Ordinary Shares outstanding during the period. Basic and diluted net loss per share were the same for each period presented as the inclusion of all potentially dilutive securities outstanding would have been anti-dilutive due to the Company’s net loss.

The table below provides potentially dilutive securities not included in the calculation of the diluted net loss per share as of the periods presented because to do so would be anti-dilutive:

​

​	​	​	​	​
​	​	September 30,
​		2025		2024
Shares issuable upon exercise of options to purchase Class A Ordinary Shares	​	14,480,663	​	9,318,906
Shares issuable upon settlement of Z33 Series Seed Preferred Shares Put Right	​	2,000,000	​	2,000,000
Shares issuable upon vesting of restricted share units	​	573,282	​	1,050,720
Restricted share awards	​	249,997	​	374,995
Total	​	17,303,942	​	12,744,621

​

Income Taxes

On July 4, 2025, President Trump signed H.R. 1, the “One Big Beautiful Bill Act” (“OBBBA”) into law. The OBBBA makes permanent many of the provisions previously enacted as part of the 2017 Tax Cut and Jobs Act that were set to expire at the end of 2025 and includes other changes to certain U.S. corporate tax provisions including (i) the restoration of immediate expensing for domestic research and development expenditures, (ii) the reinstatement of 100% bonus depreciation for qualified property and (iii) favorably modifying the section 163(j) interest limitation (similar to EBITDA). FASB Topic 740, “Income Taxes”, requires the tax effects of changes in tax laws or rates be recognized in the period in which the law is enacted. The enactment of the OBBBA did not have a material impact on our effective tax rate as of September 30, 2025.

Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position, results of operations, or cash flows upon adoption.

In December 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), ASU 2023-09 is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in the ASU address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for the Company beginning with the Company’s Annual Report on Form-10-K for the year ended December 31, 2025. Early adoption is permitted. The Company is currently evaluating the presentational effect that ASU 2023-09 will have on the Company’s consolidated financial statements and disclosures, but the Company expects considerable changes to the Company’s income tax disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”). This ASU requires disclosure, in the notes to financial statements, of the nature of certain expenses included in the income statement. ASU 2024-03 will be effective for

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annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of ASU 2024-03 and expects to adopt it for the year ending December 31, 2027.

​

3. Fair Value Measurements

The Company measures certain financial assets and liabilities at fair value on a recurring basis. The Company determines fair value based upon the exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, as determined by either the principal market or the most advantageous market. Inputs used in the valuation techniques to derive fair values are classified based on a three-level hierarchy. These levels are:

Level 1: Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

Level 2: Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and

Level 3: Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data.

Financial instruments consist of cash and cash equivalents, prepaid and other current assets, accounts payable and accrued expenses, and private placement warrants. The carrying values of the Company’s cash, prepaid and other current assets, and accounts payable and accrued expenses approximate their fair value due to the short-term maturity of these instruments.

The following table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2025 and December 31, 2024 (in thousands), and the fair value hierarchy of the valuation techniques utilized.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

September 30, 2025

​

Level 1

Level 2

Level 3

Total

Financial assets:

​

​

​

​

​

​

​

​

​

​

​

​

Cash equivalents

​

$

135,905

​

$

—

​

$

—

​

$

135,905

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

December 31, 2024

​

Level 1

Level 2

Level 3

Total

Financial assets:

​

​

​

​

​

​

​

​

​

​

​

​

Cash equivalents

​

$

170,743

​

$

—

​

$

—

​

$

170,743

​

There were no transfers into or out of Level 1, Level 2, or Level 3 during the three and nine months ended September 30, 2025.

Private Placement Warrants

In August 2024, pursuant to the Warrant Exchange (as defined herein), the Company exchanged all of the outstanding Private Placement Warrants (as defined herein) for Class A Ordinary Shares. See Note 7. The Private Placement Warrants were measured at fair value on a recurring basis. Because the transfer of Private Placement Warrants to non-permitted transferees would result in the Private Placement Warrants having substantially the same terms as the Public Warrants (as defined herein), the Company determined that the fair value of each Private Placement Warrant is consistent with that of a Public Warrant. Accordingly, the Private Placement Warrants were classified as Level 2 financial instruments. Upon completion of the Warrant Exchange, the Private Placement Warrants were remeasured to settlement value which was determined based on the fair value of the Class A Ordinary Shares issued in exchange for the Private Placement Warrants. There were no Private Placement Warrants outstanding as of September 30, 2025 and December 31, 2024. The change in fair value of the Private Placement Warrants for the three and nine months ended September 30, 2024 was $3.9 million and $5.2 million, respectively.

​

​

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4. Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses is comprised of the following as of September 30, 2025 and December 31, 2024 (in thousands):

​	​	​	​	​	​	​
​		September 30, 2025			December 31, 2024
Accrued research and development costs	​	$	8,632	​	$	7,100
Accrued 2023 Lilly License costs	​	​	5,000	​	​	9,500
Accrued settlement of Put Option	​		5,000	​	​	—
Accrued bonus	​		2,152	​	​	1,713
Accounts payable	​	​	3,275	​	​	733
Accrued professional fees	​	​	869	​	​	318
Other accrued expenses	​	​	563	​	​	150
Total accounts payable and accrued expenses	​	$	25,491	​	$	19,514

​

​

5. License

2023 Lilly License

On April 26, 2023, the Company’s consolidated subsidiary ZB17 LLC (“ZB17”) entered into a license agreement (the “2023 Lilly License” and, together with the 2022 Lilly License (as defined below), the “Lilly Licenses”) with Lilly, for an exclusive license to develop, manufacture and commercialize a certain bispecific antibody relating to IL-17 and BAFF (“tibulizumab”).

In 2023, in consideration for the investment made by Stone Peach, ZB17 granted Stone Peach the right, but not the obligation, to purchase 4.99% of the fully diluted equity of ZB17 for $1.0 million (the “Stone Peach Call Right”). The Stone Peach Call Right is not exercisable until after the last patient is dosed in any single next clinical trial with tibulizumab and expires one year from the date of first indication approval for tibulizumab by the FDA or the European Commission. The Stone Peach Call Right represents noncontrolling interest in the Company’s consolidated subsidiary, ZB17. As of September 30, 2025 and December 31, 2024, the noncontrolling interest balance was $1.5 million in the condensed consolidated balance sheets.

As additional consideration, beginning on May 1, 2023, Stone Peach receives an annual payment of $0.6 million initially, and increasing by 10% annually, so long as the Company maintains its license for tibulizumab, to be paid on May 1st of each year. The Company records expenses for these annual payments when they become due. An annual payment of $0.7 million was paid during each of the nine months ended September 30, 2025 and 2024. The Company recorded this payment within research and development expense in the condensed consolidated statement of operations.

A one-time payment of $4.5 million for additional consideration due to Stone Peach upon acceptance from the FDA for its Investigational New Drug (“IND”) and commencement of the clinical trial for tibulizumab was recorded in research and development in the consolidated statement of operations for the year ended December 31, 2024 and was paid in June 2025. The payment is included in accounts payable and accrued expenses in the condensed consolidated balance sheets as of December 31, 2024.

A letter agreement, dated as of April 25, 2023, by and between BAFFX17 Ltd (“BAFFX17”) and the Company, and as amended by Amendment No. 1 on December 18, 2023 (the “BAFFX17 Letter Agreement”), provided that, as a finder’s fee for arranging the acquisition of the 2023 Lilly License, the Company would be required to make a one-time milestone payment of $5.0 million to BAFFX17 upon the occurrence of either: (i) a change of control transaction, (ii) the closing of an issuance of equity or equity-linked securities by the Company of at least $100.0 million, (iii) the consummation of a sale of assets resulting in net proceeds in excess of $100.0 million, or (iv) the Company’s fully diluted shares outstanding exceed 52,500,000 shares (on a split adjusted basis) as measured on April 24^th of each year. As the Company’s fully diluted shares outstanding exceeded 52,500,000 shares prior to December 31, 2023, the $5.0 million fee was previously accounted for in research and development in the consolidated statement of operations for the year ended December 31, 2023, and is included in accounts payable and accrued expenses in the condensed consolidated balance sheets as of September 30, 2025 and December 31, 2024. On June 30, 2025, the Company received an invoice on behalf of BAFFX17 requesting a $5.0 million milestone payment (the “Milestone Payment”) pursuant to the BAFFX17 Letter Agreement. The Company has not made such payment as of September 30, 2025.

In addition to the consideration paid and/or earned during the years ended December 31, 2024 and 2023, the Company is also obligated to make payments (a) to Lilly for four (4) development milestone payments up to an aggregate of $155.0 million, and sales milestone payments up to an aggregate of $440.0 million based on respective thresholds of net sales of products developed from tibulizumab; (b) to Lilly over a multi-year period (twelve years, or upon the later expiration of regulatory exclusivity of tibulizumab in a country) for an

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annual earned royalty at a marginal royalty rate in the mid-single digits to low-double digits, with increasing rates depending on net sales in the respective calendar year, based on a percentage of sales within varying thresholds for a certain period of years; (c) to BAFFX17 for a fee equal to 3% of any milestone or royalty payments due to Lilly pursuant to the terms of either the 2022 Lilly License or the 2023 Lilly License; (d) to Stone Peach for a one-time milestone payment of $25 million upon either (i) certain equity-related transactions, or (ii) the receipt of regulatory approval from the applicable regulatory authority for any new indication in the applicable jurisdiction; and (e) to Stone Peach for a royalty of 2% of the aggregate net sales of any products developed from the Compound (collectively, the “2023 Lilly Contingent Payments”). As of September 30, 2025, none of the 2023 Lilly Contingent Payments are due and accordingly will not be recorded in the Company’s financial statements until they are due.

2022 Lilly License

On December 8, 2022, the Company’s consolidated subsidiary, Z33, entered into a license agreement (the “2022 Lilly License”) with Lilly pursuant to which Lilly granted Z33 an exclusive (even as to Lilly), royalty-bearing global license to develop, manufacture, and commercialize certain intellectual property owned by Lilly relating to its IL-33 compound.

A letter agreement dated as of December 8, 2022, as amended on November 21, 2023 (the “Stone Peach Letter Agreement”), by and between Stone Peach and the Company, provided that, as a finder’s fee for the 2022 Lilly License, the Company’s consolidated subsidiary Z33 issued 4,900,222 shares of Z33 Series Seed Preferred Shares to Stone Peach. Zura and Stone Peach have the following rights, as amended, (a) Zura had the right, but not the obligation to purchase up to 50% of the Series Seed Preferred Shares issued to Stone Peach at a price per share of $2.448869 for a period of two years from the date of the agreement (the “Call Option”); (b) Stone Peach has the right, but not the obligation to sell up to 50% of the Series Seed Preferred Shares issued to Stone Peach to Zura for a price per share of $2.040724 (the “Put Option”), and (c) Stone Peach has the right, but not the obligation to sell up to 50% of the Series Seed Preferred Shares issued to Stone Peach to Zura in exchange for 2,000,000 Class A Ordinary Shares (the “Put Right”). Stone Peach may exercise its Put Option and Put Right at any time between April 24, 2024, and April 24, 2028. See Note 10. The Z33 Series Seed Preferred Shares are remeasured to the greater of the redemption value or the initial fair value, less noncontrolling shareholder’s interest in net loss of Z33, at each reporting period. The Z33 Series Seed Preferred Shares represent redeemable noncontrolling interest in the Company’s consolidated subsidiary, Z33.

In July 2025, the Company received a request from Stone Peach to exercise the Put Option pursuant to which Stone Peach would sell 50% of its Series Seed Preferred Shares in Z33 for $5.0 million. Additionally, in July 2025, the Company received a further request from Stone Peach to exercise the Put Right pursuant to which Stone Peach would sell 50% of its Series Seed Preferred Shares in Z33 in exchange for 2,000,000 of the Company’s Class A Ordinary Shares. Upon exercise, the obligation to settle the Put Option in cash was recorded in accounts payable and accrued expenses and additional paid-in capital. As the Company has not yet made such cash payment, the obligation to settle the Put Right in Class A Ordinary Shares represents redeemable noncontrolling interest. As of September 30, 2025, $5.0 million to settle the Put Option is included in accounts payable and accrued expenses on the condensed consolidated balance sheet.

In addition to the consideration paid and transferred in 2022 and 2023, the Company is also obligated to make payments to Lilly for (a) $3.0 million upon the completion of a financing by Z33 with gross proceeds exceeding $100.0 million; (b) 10 commercial, development and regulatory milestone payments up to an aggregate of $155.0 million and sales milestone payments up to an aggregate of $440.0 million based on respective thresholds of net sales of products developed from the licensed compound, if any; and (c) an annual earned royalty at a marginal royalty rate between in the mid-single to low-double digits (less than 20%), with increasing rates based on net sales in the respective calendar year, based on a percentage of sales within varying thresholds for a certain period of the year, if any year (collectively, the “2022 Lilly Contingent Payments”). The Company will account for these contingent milestone payments when they become due. As of September 30, 2025, none of the 2022 Lilly Contingent Payments are due and accordingly will not be recorded in the Company’s financial statements until they are due. If a financing by Z33 with gross proceeds exceeding $100.0 million and corresponding payment of $3.0 million to Lilly does not occur by December 7, 2025, Lilly may terminate the 2022 Lilly License, unless by the same date, the Company makes a $3.0 million payment. As of September 30, 2025, no such payment has been made and will not be recorded in the Company’s financial statements until it is deemed probable.

Pfizer Agreement

On March 22, 2022, the Company entered into a license agreement and a Series A-1 Subscription and Shareholder’s Agreement (collectively, the “Pfizer Agreement”) with Pfizer. Under the Pfizer Agreement, the Company acquired a license for a compound previously developed by Pfizer.

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In addition to the consideration paid and transferred during 2022 and 2023 and the first $1.0 million development milestone paid during 2024, the Company is obligated to make payments to Pfizer for (a) eleven (11) remaining future development and regulatory milestone payments aggregating up to $69.0 million and sales milestone payments up to an aggregate of $525.0 million based on respective thresholds of net sales of products (developed from the licensed compound) (the “Products”), if any; and (b) an annual earned royalty at a marginal royalty rate in the mid-single digits to low double digits (less than 20%), based on thresholds of net sales of the Company’s Products, if any (collectively, the “Pfizer Contingent Payments”). Royalties are payable on a country-by-country basis for a certain period of years or upon the later expiration of regulatory exclusivity of the Company’s Products in a country. As of September 30, 2025, no additional Pfizer Contingent Payments are due and accordingly no additional Pfizer Contingent Payments will be recorded in the Company’s financial statements until they are due.

Lonza License

In July 2022, the Company entered into a license agreement (the “Lonza License”) with Lonza Sales AG (“Lonza”) for a worldwide non-exclusive license for Lonza’s gene expression system in exchange for varying considerations depending on a number of factors such as whether the Company enters further into manufacturing agreements with Lonza or with a third party, and whether the Company enters into sublicense agreements with third parties (including up to middle six-figure annual payments per sublicense upon commencement of a sublicense, as well as royalties of up to low-single digit percentages of net sales of certain products over a commercially standard double-digit multi-year term). The Lonza License will remain in effect until terminated. The Company may terminate the Lonza License at any time upon 60 days’ notice, with or without cause. Lonza may terminate the Lonza License for cause upon a breach by the Company or for other commercially standard reasons.

Pursuant to the terms of the Lonza License, the Company has a license fee of $0.4 million due to Lonza annually in the fourth quarter as a result of manufacturing drug substance with a third party other than Lonza since 2023. For the year ended December 31, 2024, the Company recorded $0.4 million for the Lonza License, which is included in accounts payable and accrued expenses on the condensed consolidated balance sheet as of September 30, 2025 and December 31, 2024.

WuXi Biologics License

In July 2023, the Company entered into a biologics master services agreement (the “WuXi Biologics MSA”) with WuXi Biologics. Pursuant to the WuXi Biologics MSA, the parties enter into work orders setting forth the services and fees associated with drug substance and drug product activities and manufacturing for torudokimab, which fees are recognized as research and development expenses as incurred. Pursuant to the WuXi Biologics MSA, the Company entered into a cell line license agreement (the “Cell Line License Agreement”), which is further described below.

The Cell Line License Agreement was for certain of WuXi Biologics’ know – how, cell line, and biological materials (the “WuXi Biologics Licensed Technology”) to manufacture, have manufactured, use, sell and import certain products produced through the use of the cell line licensed by WuXi Biologics under the Cell Line License Agreement (the “WuXi Biologics Licensed Products”). If the Company manufactures all of its commercial supplies of bulk drug product for WuXi Biologics Licensed Products with a manufacturer other than WuXi Biologics or its affiliates, the Company is required to make royalty payments to WuXi Biologics in an amount equal to a fraction of a single digit percentage of global net sales of WuXi Biologics Licensed Products manufactured by a third-party manufacturer (the “Royalty”). If the Company manufactures part of its commercial supplies of the WuXi Biologics Licensed Products with WuXi Biologics or its affiliates, then the Royalty will be reduced accordingly on a pro rata basis. The Cell Line License Agreement will continue indefinitely unless terminated (i) by the Company upon three months’ prior written notice and its payment of all undisputed amounts due to WuXi Biologics through the effective date of termination, (ii) by WuXi Biologics for a material breach by the Company that remains uncured for 30 days after written notice, or (iii) by WuXi Biologics if the Company fails to make a payment and such failure continues for 30 days after receiving notice of such failure. As of September 30, 2025, there are no payments currently due under the Cell Line License Agreement.

6. Shareholders’ Equity

On March 16, 2023, in connection with the closing of the Business Combination and effective upon the Closing Date, the Company authorized 300,000,000 Class A Ordinary Shares, par value of $0.0001 and 1,000,000 preferred shares, par value of $0.0001.

Exchange of Class A Ordinary Shares for Pre-Funded Warrants

In April 2025, the Company entered into share surrender and warrant agreements with certain affiliated shareholders (the “2025 Shareholders”), pursuant to which (i) the 2025 Shareholders surrendered an aggregate of 6,500,000 Class A Ordinary Shares owned by

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the 2025 Shareholders, for no consideration, which were immediately cancelled and retired, upon surrender; and (ii) the Company issued pre-funded warrants to purchase an aggregate of 6,500,000 Class A Ordinary Shares (the “2025 Share Exchange Warrants) (such transaction, the “2025 Share Exchange”). See Note 7.

Shelf Registration and ATM Program

The Company filed a shelf registration statement on Form S-3 (the “Shelf Registration Statement”), which was declared effective on September 17, 2024. Pursuant to the Shelf Registration Statement, the Company may offer and sell ordinary shares, preference shares, debt securities, warrants and or units having an aggregate public offering price of up to $300.0 million. In connection with the filing of the Shelf Registration Statement, the Company also entered into a sales agreement (the “Sales Agreement”) with Leerink Partners LLC (“Leerink Partners”), relating to the sale of the Company’s Class A Ordinary Shares having an aggregate gross sales price of up to $125.0 million, from time to time through Leerink Partners, acting as sales agent (the “ATM”). During 2024, the Company incurred $0.6 million of offering expenses in connection with establishing the ATM.

During the nine months ended September 30, 2025, the Company sold 3,000,000 Class A Ordinary Shares at a price of $1.75 per share under the ATM, for net proceeds of $5.1 million, after sales agent commissions. During the three months ended September 30, 2025, there were no sales of Class A Ordinary Shares pursuant to the ATM. As of September 30, 2025, $114.0 million of Class A Ordinary Shares remained available for sale under the Sales Agreement.

Ordinary Shares Reserved for Issuance

A summary of shares reserved for issuance as of September 30, 2025 is summarized below:

​

​	​	​
​		September 30, 2025
Shares issuable upon exercise of pre-funded warrants to purchase Class A Ordinary Shares		27,495,396
Shares issuable upon exercise of options to purchase Class A Ordinary Shares		16,819,399
Shares available for grant under 2023 Equity Incentive Plan and ESPP		374,971
Shares issuable upon settlement of Z33 Series Seed Preferred Shares Put Right(1)		2,000,000
Shares issuable upon release of restricted share units		583,282
Total shares reserved for issuance		47,273,048

(1) See Note 10 for more information.

​

​

7. Warrants

Pre-Funded Warrants

In April 2025, in conjunction with the 2025 Share Exchange (see Note 6), the Company issued the 2025 Share Exchange Warrants with an exercise price of $0.001 per share and no expiration date. The 2025 Share Exchange Warrants are exercisable immediately and have substantially identical terms to the form of 2024 Pre-Funded Warrant (see below).

On August 15, 2024, the Company entered into a share surrender and warrant agreement with certain affiliated shareholders (the “2024 Shareholders”), pursuant to which (i) the 2024 Shareholders surrendered an aggregate of 4,000,000 Class A Ordinary Shares owned by the 2024 Shareholders, for no consideration, which were immediately cancelled and retired, upon surrender; and (ii) the Company issued pre-funded warrants to purchase an aggregate of 4,000,000 Ordinary Shares, with an exercise price of $0.001 per share (the “2024 Share Exchange Warrants”).

In connection with the April 2024 Private Placement, the Company sold to accredited investors the pre-funded warrants to purchase up to 16,102,348 Class A Ordinary Shares at a price of $3.107 per pre-funded warrant for an aggregate purchase price of $50.0 million (the “2024 Pre-Funded Warrants”).

During the three months ended September 30, 2025, 1,206,952 Class A Ordinary Shares were issued in connection with the exercise of 2024 Pre-Funded Warrants. As of September 30, 2025, 14,895,396 of the 2024 Pre-Funded Warrants remained outstanding.

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In connection with the April 2023 Private Placement, the Company sold to accredited investors pre-funded warrants to purchase up to 3,782,000 Class A Ordinary Shares at a price of $4.249 per pre-funded warrant for an aggregate purchase price of approximately $16.1 million (the “2023 Pre-Funded Warrants”).

During the three months ended September 30, 2025, 1,682,000 Class A Ordinary Shares were issued in connection with the exercise of 2023 Pre-Funded Warrants. As of September 30, 2025, 2,100,000 of the 2023 Pre-Funded Warrants remained outstanding.

As of September 30, 2025 and December 31, 2024, there was an aggregate 27,495,396 and 23,884,348 pre-funded warrants outstanding, respectively, consisting of the 2023 Pre-Funded Warrants, 2024 Pre-Funded Warrants, 2024 Share Exchange Warrants and the 2025 Share Exchange Warrants (collectively, the “Pre-Funded Warrants”), each with an exercise price of $0.001.

​

Each Pre-Funded Warrant is exercisable for one Class A Ordinary Share at any time or times until the Pre-Funded Warrants are exercised in full. A holder of the Pre-Funded Warrants (together with its affiliates and other attribution parties) may not exercise any portion of a Pre-Funded Warrant to the extent that immediately prior to or after giving effect to such exercise the holder would beneficially own more than 4.99% or 9.99%, depending on the holder of the Company’s outstanding Class A Ordinary Shares immediately after exercise, which percentage may be increased or decreased to any other percentage specified not in excess of 19.99% at the holder’s election upon 61 days’ notice to the Company subject to the terms of the Pre-Funded Warrants.

Warrant Exchange

On August 12, 2024, the Company completed an exchange offer (the “Exchange Offer”) relating to its outstanding warrants that it assumed in connection with the Business Combination, including (i) public warrants to purchase 5,910,000 Class A Ordinary Shares (the “Public Warrants”) that were held by JATT, and (ii) private placement warrants to purchase 6,899,996 Class A Ordinary Shares (the “Private Placement Warrants”) that were held by JATT shareholders, and issued 2,064,082 Class A Ordinary Shares in exchange for the Public Warrants and 1,718,108 Class A Ordinary Shares in exchange for the Private Placement Warrants (collectively, the “Warrant Exchange”).

​

8. Share-based Compensation

On March 16, 2023, JATT’s board of directors approved the Zura Bio Limited 2023 Equity Incentive Plan (the “Equity Incentive Plan”) which became effective on the day immediately preceding the Closing Date of the Business Combination. The Equity Incentive Plan allows for the grant of share options, both incentive and nonqualified share options; stock appreciation rights (“SARs”), alone or in conjunction with other awards; restricted shares awards (“RSAs”) and restricted share units (“RSUs”); incentive bonuses, which may be paid in cash, shares, or a combination thereof; and other share-based awards to employees, officers, non-employee directors and other service providers. The Company has granted share options, RSUs and RSAs that generally vest over four years and expire after 10 years.

The Class A Ordinary Shares issuable under the Equity Incentive Plan are subject to an annual increase on January 1st of each calendar year beginning on January 1, 2024, and ending on and including January 1, 2029, equal to the lesser of (i) 5.0% of the aggregate number of Class A Ordinary Shares outstanding on the final day of the immediately preceding calendar year, (ii) 8,059,796 Class A Ordinary Shares or (iii) such smaller number of shares as is determined by the board.

On March 16, 2023, JATT’s board of directors approved the Zura Bio Limited 2023 Employee Share Purchase Plan (the “ESPP”) which became effective on the day immediately preceding the Closing Date of the Business Combination. The maximum number of Class A Ordinary Shares that may be issued under the ESPP is 4,029,898, plus an aggregate number of Class A Ordinary shares that are automatically added under the Equity Incentive Plan on January 1st of each calendar year, beginning on January 1, 2024, and ending on and including January 1, 2029, as discussed above. The ESPP enables eligible employees of the Company and designated affiliates to purchase Class A Ordinary Shares at a discount of 15%. As of September 30, 2025, the Company has not activated its ESPP.

On January 1, 2025, the Class A Ordinary Shares reserved for future issuances under the Equity Incentive Plan and/or ESPP were increased by the annual automatic increase of 5% of outstanding Class A Ordinary Shares as of December 31, 2024, or 3,264,877 Class A Ordinary Shares. As of September 30, 2025, there were 18,944,302 Class A Ordinary Shares authorized for issuance under the Equity Incentive Plan and ESPP, collectively, including 2,055,314 Class A Ordinary Shares authorized for issuance outside of the Equity Incentive Plan and the ESPP.

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Equity Incentive Plan

Share Options

The fair value of Equity Incentive Plan share options are estimated on the date of grant using the Black-Scholes option pricing model. The Company lacks significant company-specific historical and implied volatility information. Therefore, it estimates its expected share volatility based on the historical volatility of a publicly traded set of peer companies. Due to the lack of historical exercise history, the expected term of the Company’s share options has been determined using the simplified method, averaging the vesting period and the contractual life of the share options granted. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is zero based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future.

The following weighted-average assumptions were used to estimate the fair value of the Equity Incentive Plan share options issued during the nine months ended September 30, 2025 and 2024:

​

​	​	​	​	​	​	​	​
​	​	For the Nine Months Ended					​
​		September 30,					​
​		2025			2024
Share price	​	$	1.20	​	$	3.49	​
Expected volatility	​	​	100.3	%	​	101.2	%
Risk-free rate	​	​	4.1	%	​	4.2	%
Expected term (in years)	​	​	6.1	​	​	6.1	​
Expected dividend yield	​	​	0	%	​	0	%

​

The following table summarizes the Company’s share option activity for the nine months ended September 30, 2025:

​

​	​	​	​	​	​	​	​	​	​	​
​		​		​	​		Weighted		​	​
​	​	​	​	Weighted		​	Average	​	Aggregate
​	​	​	​	Average		​	Remaining	​	Intrinsic
​	​	Number of	​	Exercise Price		​	Contractual	​	Value
​		Options		(per share)			Life (Years)		(in thousands)
Options outstanding as of December 31, 2024		12,217,747	​	$	2.88	​	8.9	​	$	8,388
Granted	​	5,715,390	​	$	1.20	​	​	​	​	​
Exercised	​	(75,468)	​	$	1.20	​	​	​	​	​
Forfeited		(1,038,270)	​	$	1.88	​	​	​	​	​
Options outstanding as of September 30, 2025		16,819,399	​	$	2.38	​	8.6	​	$	36,447
Options vested and exercisable as of September 30, 2025		7,046,030	​	$	2.27	​	8.1	​	$	16,024

​

Included in options outstanding as of September 30, 2025 and December 31, 2024 in the table above are 2,055,314 and 2,165,369 options, respectively, to purchase Class A Ordinary Shares issued to certain directors, executives, and employees outside of the Equity Incentive Plan.

In May 2025, the Company granted 408,000 share options to purchase Class A Ordinary shares with non-market performance conditions (“PSOs”), included in the table above, that will vest upon the earlier of achieving a one-year service condition or upon the Company’s next Annual General Meeting (“AGM”).

In December 2024, the Company granted 1,053,000 PSOs (the “2024 PSOs”), included in the table above, that were to vest upon the earlier of achieving a one-year service condition or upon the Company’s AGM. In February 2025, the date of the AGM was set to May 21, 2025 (the “AGM Date”). Accordingly, management determined that the performance condition was met and recorded the remaining unrecognized compensation expense of $1.5 million ratably through the AGM Date. The 2024 PSOs vested on the AGM Date.

The weighted average grant date fair value of options granted during the nine months ended September 30, 2025 and 2024 was $0.97 and $2.83, respectively.

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Market-Based Share Options

As of September 30, 2025, there are 306,373 options outstanding to purchase Class A Ordinary Shares, with market-based performance conditions, (“Market-Based Share Options”) that were granted to a certain director of the board during 2023. These awards will vest only to the extent that the 20-day volume weighted average trading price (“VWAP”) of the Class A Ordinary Shares is over $30 per Class A Ordinary Share at any time prior to the fifth anniversary of the grant date. These awards have an exercise price of $8.16 and become exercisable when vested and the market condition is satisfied. These awards expire 10 years from the date of grant. The fair value of these Market-Based Share Options was estimated using a Monte Carlo valuation method on the grant date. No Market-Based Share Options were granted during the nine months ended September 30, 2025 and the year ended December 31, 2024.

The expense recognized related to Market-Based Share Options was $0 and $0.2 million, respectively, for the three months ended September 30, 2025 and 2024, and $0.3 million and $0.5 million, respectively, for each of the nine months ended September 30, 2025 and 2024.

Restricted Share Units

The following table summarizes the Company’s RSU activity for the nine months ended September 30, 2025:

​

​	​	​	​	​	​
​		​		​	​
​	​	​	​	Weighted
​	​	Number of	​	Average
​		RSUs		Grant Date FV
Unvested RSUs outstanding as of December 31, 2024		874,923	​	$	5.99
Released	​	(291,641)	​	​	5.99
Unvested RSUs outstanding as of September 30, 2025		583,282	​	$	5.99

​

The expense recognized related to RSUs was $0.5 million for each of the three months ended September 30, 2025 and 2024, and $1.3 million and $1.6 million for the nine months ended September 30, 2025 and 2024, respectively.

Restricted Share Awards

The following table summarizes the Company’s RSA activity for the nine months ended September 30, 2025:

​

​	​	​	​	​	​
​		​		Weighted
​	​	​	​	Average
​	​	Number of	​	Grant Date
​		RSAs		Fair Value
Unvested RSAs outstanding as of December 31, 2024		374,995	​	$	8.16
Vested		(124,998)	​	​	8.16
Unvested RSAs outstanding as of September 30, 2025		249,997	​	$	8.16

​

The expense recognized related to RSAs was $0.3 million for each of the three months ended September 30, 2025 and 2024, and $0.8 million for each of the nine months ended September 30, 2025 and 2024.

Equity Award Modification

During the three months ended June 30, 2025, the Company amended a member of the board of director’s option agreements, causing his unvested options to purchase 32,099 Class A Ordinary Shares to become fully vested and exercisable as of the AGM Date. Additionally, the board of directors extended the post-termination exercise period of his vested options to purchase an aggregate of 165,149 Class A Ordinary Shares to the applicable expiration date of each of the respective option awards, upon completion of his service as a member of the board of directors. During the nine months ended September 30, 2025, the Company recognized $0.1 million of share-based compensation expense related to this modification within general and administrative expense in the condensed consolidated statement of operations.

On June 27, 2025, the Company and Verender Badial, the Company’s former Chief Financial Officer, entered into an agreement in connection with Mr. Badial’s resignation from the Company (the “Settlement Agreement”). The Settlement Agreement provides for accelerated vesting of the unvested portion of two outstanding options, previously granted to Mr. Badial, relating to an aggregate of 198,540 Class A Ordinary Shares, which became fully vested and exercisable on July 31, 2025. The Settlement Agreement also provides for an extension of the post-termination exercise period of all of Mr. Badial’s vested share options to the applicable expiration date of

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the applicable share option, as of July 31, 2025, subject to certain conditions therein. All other remaining unvested options to purchase Class A Ordinary Shares were forfeited and cancelled on July 31, 2025. For the three and nine months ended September 30, 2025, the Company recognized $0.1 million and $0.2 million, respectively, of share-based compensation expense related to this modification within general and administrative expense in the condensed consolidated statement of operations.

Share-based Compensation Expense

Share-based compensation expense for all equity arrangements for the three and nine months ended September 30, 2025 and 2024 was as follows (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the Three Months Ended

​

For the Nine Months Ended

​

​

September 30,

​

September 30,

​

2025

2024

2025

2024

Research and development

​

$

569

​

$

772

​

$

1,463

​

$

1,841

General and administrative

​

1,810

​

​

7,874

​

​

8,292

​

​

12,140

Total share-based compensation expense

​

$

2,379

​

$

8,646

​

$

9,755

​

$

13,981

​

As of September 30, 2025, there was approximately $15.8 million of total unrecognized share-based compensation expense related to options granted to employees, executives, and directors that is expected to be recognized over a weighted average period of 3.0 years. As of September 30, 2025, there was approximately $2.9 million of total unrecognized share-based compensation expense related to RSUs granted to certain employees, executives, and directors under the Company’s Equity Incentive Plan that is expected to be recognized over a weighted average period of 1.7 years. As of September 30, 2025, there was approximately $1.5 million of total unrecognized share-based compensation expense related to RSAs granted to a certain director under the Company’s Equity Incentive Plan that is expected to be recognized over a weighted average period of 1.5 years.

​

9. Commitments and Contingencies

Litigation

The Company is not a party to any material legal proceedings and is not aware of any material pending or threatened claims. From time to time, the Company may be subject to various legal proceedings and claims that arise in the ordinary course of its business activities.

10. Redeemable Noncontrolling Interest

As a finder’s fee for the 2022 Lilly License, the Company’s consolidated subsidiary Z33 issued 4,900,222 shares of Z33 Series Seed Preferred Shares to Stone Peach. Zura and Stone Peach have the following rights, as amended, (a) Zura had the right, but not the obligation to purchase up to 50% of the Series Seed Preferred Shares issued to Stone Peach at a price per share of $2.448869 for a period of two years from the date of the agreement (the “Call Option”); (b) Stone Peach has the right, but not the obligation to sell up to 50% of the Series Seed Preferred Shares issued to Stone Peach to Zura for a price per share of $2.040724 (the “Put Option”), and (c) Stone Peach has the right, but not the obligation to sell up to 50% of the Series Seed Preferred Shares issued to Stone Peach to Zura in exchange for 2,000,000 Class A Ordinary Shares (the “Put Right”). Stone Peach may exercise its Put Option and Put Right at any time between April 24, 2024, and April 24, 2028.

During the three months ended September 30, 2025, Stone Peach exercised its Put Option and Put Right. Upon exercise, the obligation to settle the Put Option in cash was recorded in accounts payable and accrued expenses extinguishing 50% of the redeemable noncontrolling interest. The Company has not yet made such payment. As of September 30, 2025, $5.0 million to settle the Put Option is included in accounts payable and accrued expenses on the condensed consolidated balance sheet. See Note 5.

As it is not possible to specifically identify the shares that may be redeemed upon exercising the Put Option, and the applicable unit of account is each share, the Company assessed that the remaining 50% of the Z33 Series Seed Preferred Shares must be considered redeemable until the settlement of the Put Option or Put Right. Accordingly, the 50% of the Z33 Series Seed Preferred Shares issued to Stone Peach represent redeemable noncontrolling interest and were remeasured as of September 30, 2025. As of September 30, 2025 and December 31, 2024, the redeemable noncontrolling interest balance was $8.7 million and $11.7 million, respectively.

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11. Defined Contribution Plans

​

The Company maintains a 401(k) defined contribution retirement plan (the “401(k) Plan”) for all of its U.S. employees. For the 401(k) Plan, the Company makes a matching contribution up to a maximum of 6% of an employee’s annual salary. For U.K. employees, the Company contributes up to 6% of an employee’s annual salary to defined contribution retirement pension plans (the “U.K. Defined Contribution Plan” and, together with the 401(k) Plan, the “Defined Contribution Plans”). Contributions made by the Company vest 100% upon contribution. The expense recorded for the Defined Contribution Plans was $0.1 million and $57,000 for the three months ended September 30, 2025 and 2024, respectively, and $0.4 million and $0.2 million for the nine months ended September 30, 2025 and 2024, respectively.

​

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

The following discussion and analysis provides information that management believes is relevant to an assessment and understanding of our consolidated results of operations and financial condition. You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our audited consolidated financial statements as of December 31, 2024, included in the 2024 Annual Report filed with the SEC on March 25, 2025, and in conjunction with the unaudited condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report.

In addition to historical information, this discussion and analysis contains forward-looking statements. These forward-looking statements are subject to risks and uncertainties, including those discussed in the section titled “Risk Factors” in our Form 10-K filed with the SEC on March 25, 2025, as supplemented by the risks and uncertainties described in “Risk Factors” Item I.A. Risk Factors in Part II of this Quarterly Report, that could cause actual results to differ materially from historical results or anticipated results. You should carefully read the information under “Cautionary Note Regarding Forward-Looking Statements” in this Quarterly Report. Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “Zura,” “we,” “us,” and “our” refer to Zura Bio Limited, a Cayman Islands exempted company formerly known as JATT Acquisition Corp, and its consolidated subsidiaries. References to JATT Acquisition Corp or “JATT” refer to the Company prior to the consummation of the Business Combination.

Overview

We are a clinical-stage, multi-asset immunology company dedicated to developing novel dual-pathway antibodies for autoimmune and inflammatory diseases with unmet needs. Leveraging the extensive experience of our team, we identify relevant diseases and develop our differentiated assets in those diseases. Our strategic focus is to harness dual-pathway biology to provide broader and deeper clinical benefits to patients with autoimmune and inflammatory diseases.

We are currently advancing one lead product candidate in ongoing Phase 2 clinical trials and are actively evaluating additional development opportunities across our pipeline of clinical-stage product candidates, prioritizing indications with unmet need and commercial potential.

Our lead product candidate, tibulizumab (ZB-106), is an immunoglobulin G (“IgG”)-single-chain variable fragment (“scFv”) bispecific dual-antagonist antibody engineered by the fusion of TALTZ® (ixekizumab) and tabalumab to neutralize interleukin-17A (IL-17A) and B-cell activating factor (“BAFF”). These cytokines play pivotal roles in various inflammatory and autoimmune disorders. By targeting IL-17A and BAFF, tibulizumab demonstrates potential in mitigating chronic inflammation while preserving the integrity of the immune system. Three Phase 1/1b clinical studies evaluating tibulizumab have been completed, including studies involving participants with rheumatoid arthritis and Sjögren’s syndrome.

In May 2025, the Company initiated TibuSHIELD, a global Phase 2 clinical study evaluating tibulizumab in adults with moderate to severe hidradenitis suppurativa (“HS”). TibuSHIELD is a randomized, double-blind, placebo-controlled study designed to assess the safety, tolerability, and efficacy of tibulizumab in approximately 180 adults across the United States, Canada and Europe. The study will evaluate tibulizumab over a 28-week period, which includes a 16-week efficacy assessment period followed by an optional open-label extension (“OLE”) and a 12-week safety follow-up. The primary endpoint of the study is the percent change from baseline in total abscess and nodule (“AN”) count at week 16. Secondary endpoints include the proportion of participants achieving HiSCR50 or HiSCR75, defined as at least a 50% or 75% reduction in AN count without an increase in abscesses or draining fistulas at week 16. Key safety assessments include the assessment of tolerability, and monitoring for adverse events. Topline results are expected to be available in the third quarter of 2026. We continue to monitor timelines and evaluate strategy in light of the competitive landscape for conducting clinical trials, competition for enrollment of patients, and external events, including those potentially impacting regulatory matters and overall study execution.

In December 2024, we initiated TibuSURE, a global Phase 2 clinical study evaluating tibulizumab in adults with early diffuse cutaneous systemic sclerosis (“dcSSc”). TibuSURE is a randomized, double-blind, placebo-controlled study designed to assess the safety, tolerability, and efficacy of tibulizumab in approximately 80 participants with early diffuse cutaneous systemic sclerosis (dcSSc). The study includes a 24-week efficacy period followed by a 28-week OLE. The primary endpoint is the modified Rodnan Skin Score (“mRSS”). Key efficacy endpoints include lung disease, assessed by quantitative high-resolution computed tomography (“qHRCT”) and forced vital capacity (“FVC”); physical function, measured by the Health Assessment Questionnaire-Disability Index (HAQ-DI); and the revised Combined Response Index in Systemic Sclerosis (“rCRISS”). Topline results are expected to be available in the fourth quarter of 2026. We continue to monitor timelines and evaluate strategy in light of the competitive landscape for conducting clinical

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trials, competition for enrollment of patients, and external events, including those potentially impacting regulatory matters and overall study execution.

Crebankitug (ZB-168) is a fully human, high affinity monoclonal antibody that binds and neutralizes the interleukin-7 receptor (IL-7R) alpha chain. IL-7Rα sits at the nexus of two key immune pathways, IL-7 and thymic stromal lymphopoietin (TSLP), thus IL-7Rα has the potential to block activation through either of these pathways. As a result, we believe crebankitug could be therapeutically relevant in a broad set of indications where the IL-7 or TSLP pathways may be involved. Three Phase 1/1b clinical studies evaluating crebankitug have been conducted to date. We are actively assessing the competitive landscape and evaluating potential therapeutic indications for crebankitug.

Torudokimab (ZB-880) is a fully human, high affinity monoclonal antibody that neutralizes interleukin-33 (IL-33), thereby inhibiting ST2-dependent inflammatory signaling and potentially modulating ST2-independent pathways, such as those mediated by the RAGE. The IL-33/ST2 axis is supported by genetic evidence and is under clinical investigation as a therapeutic target in inflammatory diseases, with development programs in asthma and ongoing evaluation in COPD. Three Phase 1/2 clinical studies evaluating torudokimab have been conducted to date. We continue to monitor publicly available clinical data from other IL-33/ST2-targeted programs. To date, two companies have reported results from Phase 2b and Phase 3 trials in COPD, with some studies meeting their predefined efficacy endpoints and others not. An additional IL-33/ST2 program is expected to report results in 2026. These data, along with ongoing internal assessments and an evaluation of the competitive landscape, may inform future development plans for torudokimab.

We were incorporated as a Cayman Islands exempted company on March 10, 2021. Our wholly owned subsidiary, Zura Bio Limited was formed in the United Kingdom (“U.K.”) (“Zura Bio UK”), on January 18, 2022. Prior to March 20, 2023, our operations were conducted through Zura Bio UK.

We have a limited operating history. Since our inception, our operations have focused on organizing and staffing our company, business planning, raising capital and entering into collaboration agreements for conducting manufacturing, and research and development activities. Our lead product candidate is in the clinical testing stage; however, prior to the initiation of TibuSHIELD and TibuSURE in May 2025 and December 2024, respectively, we had not conducted any clinical tests ourselves. We do not have any product candidates approved for sale and have not generated any revenue from product sales. We have funded our operations through (i) the sale of equity, raising an aggregate of $10.0 million of gross proceeds from the sale of our convertible preferred shares of Zura Bio UK through March 31, 2023; (ii) the issuance of a promissory note, receiving net proceeds of $7.6 million in December 2022; (iii) proceeds from the Business Combination of $56.7 million in March 2023; (iv) the sale of Class A Ordinary Shares and pre-funded warrants to purchase up to 3,782,000 Class A Ordinary Shares at a price of $4.249 per pre-funded warrant for an aggregate purchase price of approximately $16.1 million (the “2023 Pre-Funded Warrants”) during the year ended December 31, 2023 (the “April 2023 Private Placement”), raising an aggregate of $75.8 million of net cash proceeds; (v) the sale of Class A Ordinary Shares and pre-funded warrants to purchase up to 16,102,348 Class A Ordinary Shares at a price of $3.107 per pre-funded warrant for an aggregate purchase price of $50.0 million (the “2024 Pre-Funded Warrants”) in April 2024 (the “April 2024 Private Placement”) raising an aggregate of $105.3 million of net cash proceeds; (vi) the sale of 1,500,000 Class A Ordinary Shares at a price of $3.80 per share under the ATM (as defined below) for net proceeds of $5.5 million, after sales agent commissions, in September 2024; and (vii) the sale of 3,000,000 Class A Ordinary Shares at a price of $1.75 per share under the ATM for net proceeds of $5.1 million, after sales agent commissions, in the first quarter of 2025.

Since our inception, we have incurred significant operating losses. Our net loss for the three and nine months ended September 30, 2025 were $18.0 million and $51.5 million, respectively. As of September 30, 2025, we had an accumulated deficit of $207.4 million. We anticipate that our expenses will increase significantly in connection with our ongoing activities, as we:

● continue to advance the preclinical and clinical development of our product candidates;

● conduct our planned preclinical studies and clinical trials for our product candidates, as well as initiate and complete additional trials of future potential product candidates;

● scale up our clinical and regulatory capabilities;

● manufacture current good manufacturing practices, or cGMP, material for clinical trials or potential commercial sales;

● hire additional clinical, quality, regulatory, manufacturing, scientific and administrative personnel;

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● establish a commercialization infrastructure and scale up manufacturing and distribution capabilities to commercialize any product candidates for which we may obtain regulatory approval;

● adapt our regulatory compliance efforts to incorporate requirements applicable to marketed products;

● seek regulatory approval for any product candidates that successfully complete clinical trials;

● maintain, expand and protect our intellectual property portfolio;

● add operational, financial, and management information systems and personnel, including personnel to support our product development and planned future commercialization efforts; and

● incur additional legal, accounting, and other expenses in operating as a public company.

Recent Developments

On July 4, 2025, President Trump signed H.R. 1, the “One Big Beautiful Bill Act” (“OBBBA”) into law. The OBBBA makes permanent many of the provisions previously enacted as part of the 2017 Tax Cut and Jobs Act that were set to expire at the end of 2025 and includes other changes to certain U.S. corporate tax provisions including (i) the restoration of immediate expensing for domestic research and development expenditures, (ii) the reinstatement of 100% bonus depreciation for qualified property and (iii) favorably modifying the section 163(j) interest limitation (similar to EBITDA). FASB Topic 740, “Income Taxes”, requires the tax effects of changes in tax laws or rates be recognized in the period in which the law is enacted. The enactment of the OBBBA did not have a material impact on our effective tax rate as of September 30, 2025.

Effective July 7, 2025, Eric Hyllengren succeeded Verender Badial as Chief Financial Officer of the Company.

On October 10, 2025, we announced that Robert Lisicki, our Chief Executive Officer, commenced a medical leave of absence. Accordingly, effective October 10, 2025, our board of directors appointed Kim Davis, our Chief Operating Officer, Chief Legal Officer and Corporate Secretary, to serve as our interim Chief Executive Officer, in addition to her current duties.

Business Combination

On March 20, 2023, we consummated the previously-announced transactions contemplated by the Business Combination Agreement, dated June 16, 2022, as amended on September 20, 2022, November 14, 2022, and January 13, 2023 by and among Zura Bio Limited, a limited company incorporated under the laws of England and Wales (“Zura Bio UK”), JATT Acquisition Corp, a Cayman Islands exempted company (“JATT”), JATT Merger Sub, a Cayman Islands exempted company and wholly owned subsidiary of JATT (“Merger Sub”), JATT Merger Sub 2, a Cayman Islands exempted company and wholly owned subsidiary of JATT (“Merger Sub 2”) and Zura Bio Holdings Ltd, a Cayman Islands exempted company (“Holdco”), following the approval at an extraordinary general meeting of JATT’s shareholders held on March 16, 2023.On March 21, 2023, our Class A Ordinary Shares and public warrants began trading on the Nasdaq under the symbols “ZURA” and “ZURAW,” respectively. As of August 27, 2024, our public warrants were no longer listed on the Nasdaq in connection with the completion of our exchange of our public warrants for shares.

Shelf Registration and ATM Program

Pursuant to the shelf registration statement on Form S-3 declared effective on September 17, 2024 (the “Shelf Registration Statement”), we may offer and sell ordinary shares, preference shares, debt securities, warrants and or units having an aggregate public offering price of up to $300.0 million. In connection with the filing of the Shelf Registration Statement, we also entered into a sales agreement (the “Sales Agreement”) with Leerink Partners LLC (“Leerink Partners”), relating to the sale of our Class A Ordinary Shares having an aggregate gross sales price of up to $125.0 million, from time to time through Leerink Partners, acting as sales agent (the “ATM”). In the first quarter of 2025, we sold 3,000,000 Class A Ordinary Shares at a price of $1.75 per share under the ATM, for net proceeds of $5.1 million, after sales agent commissions. There were no sales of Class A Ordinary Shares pursuant to the ATM during the second and third quarters of 2025. As of the date of this filing, we have $114.0 million of Class A Ordinary Shares remaining available for sale under the Sales Agreement.

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Pre-Funded Warrant Activity

In July 2025, we issued 1,682,000 and 1,206,952 Class A Ordinary Shares in connection with the exercise of 2023 Pre-Funded Warrants and 2024 Pre-Funded Warrants, respectively. The exercise prices for such pre-funded warrants were immaterial.

In April 2025, we entered into share surrender and warrant agreements with certain affiliated shareholders (the “2025 Shareholders”), pursuant to which (i) the 2025 Shareholders surrendered an aggregate of 6,500,000 Class A Ordinary Shares owned by the 2025 Shareholders, for no consideration, which were immediately cancelled and retired, upon surrender; and (ii) we issued pre-funded warrants to purchase an aggregate of 6,500,000 Class A Ordinary Shares, with an exercise price of $0.001 per share and no expiration date (the “2025 Share Exchange Warrants). The 2025 Share Exchange Warrants are exercisable immediately and have substantially identical terms to the pre-funded warrants issued in 2024 in connection with our April 2024 subscription agreements.

2023 Lilly License

On April 26, 2023, our consolidated subsidiary ZB17 LLC (“ZB17”) entered into a license agreement (the “2023 Lilly License” and, together with the 2022 Lilly License (as defined below), the “Lilly Licenses”) with Lilly, for an exclusive license to develop, manufacture and commercialize a certain bispecific antibody relating to IL-17 and BAFF (“tibulizumab”).

In consideration for the investment made by Stone Peach, in 2023 ZB17 granted Stone Peach the right, but not the obligation, to purchase 4.99% of the fully diluted equity of ZB17 for $1.0 million (the “Stone Peach Call Right”). The Stone Peach Call Right is not exercisable until after the last patient is dosed in any single next clinical trial with tibulizumab and expires one year from the date of first indication approval for tibulizumab by the United States Food and Drug Administration (“FDA”) or European Commission. The Stone Peach Call Right represents noncontrolling interest in our consolidated subsidiary, ZB17. As of September 30, 2025 and December 31, 2024 the noncontrolling interest balance was $1.5 million in the condensed consolidated balance sheets.

As additional consideration, beginning on May 1, 2023, Stone Peach receives an annual payment of $0.6 million initially, and increasing by 10% annually, so long as we maintain our license for tibulizumab, to be paid on May 1^st of each year. We record expenses for these annual payments when they become due. An annual payment of $0.7 million was paid during each of the nine months ended September 30, 2025 and 2024. The Company recorded this payment within research and development expenses in the condensed consolidated statement of operations.

A one-time payment of $4.5 million for additional consideration due to Stone Peach upon acceptance from the FDA for our Investigational New Drug (“IND”) and commencement of our clinical trial for tibulizumab was recorded in research and development in the consolidated statement of operations for the year ended December 31, 2024 and was paid in June 2025. This payment is included in accounts payable and accrued expenses in the condensed consolidated balance sheets as of December 31, 2024.

A letter agreement, dated as of April 25, 2023, by and between BAFFX17, Ltd (“BAFFX17”) and the Company, and as amended by Amendment No. 1 on December 18, 2023 (the “BAFFX17 Letter Agreement”), provided that, as a finder’s fee for arranging the acquisition of the 2023 Lilly License, we would be required to make a one-time milestone payment of $5.0 million to BAFFX17 upon the occurrence of either: (i) a change of control transaction, (ii) the closing of an issuance of equity or equity-linked securities by us of at least $100.0 million (iii) the consummation of a sale of assets resulting in net proceeds in excess of $100.0 million, or (iv) our fully diluted shares outstanding exceed 52,500,000 shares (on a split adjusted basis), as measured on April 24th of each year. As our fully diluted shares outstanding exceeded 52,500,000 shares prior to December 31, 2023, the $5.0 million fee was previously accounted for in research and development in the consolidated statement of operations for the year ended December 31, 2023, and is included in accounts payable and accrued expenses in the condensed consolidated balance sheets as of September 30, 2025 and December 31, 2024. On June 30, 2025, the Company received an invoice on behalf of BAFFX17 requesting a $5.0 million milestone payment (the “Milestone Payment”) pursuant to the BAFFX17 Letter Agreement. The Company has not made such payment as of September 30, 2025. See “Part II – Item 1A. Risk Factors – Our business, reputation, financial condition and results of operations could be adversely affected by our ongoing internal review of certain agreements and other matters.”

In addition to the consideration paid and/or earned in 2024 and 2023, we are also obligated to make payments (a) to Lilly for four (4) development milestone payments up to an aggregate of $155.0 million, and sales milestone payments up to an aggregate of $440.0 million based on respective thresholds of net sales of products developed from tibulizumab; (b) to Lilly over a multi-year period (twelve years, or upon the later expiration of regulatory exclusivity of tibulizumab in a country) for an annual earned royalty at a marginal royalty rate in the mid-single digits to low-double digits, with increasing rates depending on net sales in the respective calendar year, based on a percentage of sales within varying thresholds for a certain period of years; (c) to BAFFX17 for a fee equal to 3% of any

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milestone or royalty payments due to Lilly pursuant to the terms of either the 2022 Lilly License or the 2023 Lilly License; (d) to Stone Peach for a one-time milestone payment of $25 million upon either (i) certain equity-related transactions, or (ii) the receipt of regulatory approval from the applicable regulatory authority for any new indication in the applicable jurisdiction; and (e) to Stone Peach for a royalty of 2% of the aggregate net sales of any products developed from the Compound (collectively, the “2023 Lilly Contingent Payments”). As of September 30, 2025, none of the 2023 Lilly Contingent Payments are due and accordingly will not be recorded in our financial statements until they are due.

2022 Lilly License

On December 8, 2022, our consolidated subsidiary, Z33 Bio Inc. (“Z33”), entered into a license agreement (the “2022 Lilly License”) with Lilly pursuant to which Lilly granted Z33 an exclusive (even as to Lilly), royalty-bearing global license to develop, manufacture, and commercialize certain intellectual property owned by Lilly relating to its IL-33 compound.

A letter agreement dated December 8, 2022, as amended on November 21, 2023 (the “Stone Peach Letter Agreement”) by and between Stone Peach and the Company, provided that, as a finder’s fee for the 2022 Lilly License, Z33 issued to Stone Peach Properties, LLC (“Stone Peach”) 4,900,222 shares of Z33 Series Seed Preferred Shares to Stone Peach. We and Stone Peach have the following rights, as amended, (a) we had the right, but not the obligation to purchase up to 50% of the Series Seed Preferred Shares issued to Stone Peach at a price per share of $2.448869 for a period of two years from the date of the agreement (the “Call Option”); (b) Stone Peach has the right, but not the obligation to sell up to 50% of the Series Seed Preferred Shares issued to Stone Peach to us for a price per share of $2.040724 (the “Put Option”), and (c) Stone Peach has the right, but not the obligation to sell up to 50% of the Series Seed Preferred Shares issued to Stone Peach to us in exchange for 2,000,000 Class A Ordinary Shares (the “Put Right”). Stone Peach may exercise its Put Option and Put Right at any time between April 24, 2024, and April 24, 2028. The Z33 Series Seed Preferred Shares are remeasured to the greater of the redemption value or the initial fair value, less noncontrolling shareholder’s interest in net loss of Z33, at each reporting period. The Z33 Series Seed Preferred Shares represent redeemable noncontrolling interest in our consolidated subsidiary, Z33. On July 14, 2025, the Company received a request from Stone Peach to exercise the Put Option pursuant to the Stone Peach Letter Agreement pursuant to which Stone Peach would sell 50% of its Series Seed Preferred Shares in Z33 for $5.0 million. Additionally, on July 23, 2025, the Company received a further request from Stone Peach to exercise the Put Right pursuant to the Stone Peach Letter Agreement pursuant to which Stone Peach would sell 50% of its Series Seed Preferred Shares in Z33 in exchange for 2,000,000 of the Company’s Class A Ordinary Shares. The Company has not effected either the Put Option or the Put Right as of September 30, 2025. See “Part II –Item 1A. Risk Factors – Our business, reputation, financial condition and results of operations could be adversely affected by our ongoing internal review of certain agreements and other matters.”

In addition to the consideration paid and transferred in 2022, we are also obligated to make payments to Lilly for (a) $3.0 million upon the completion of a financing by Z33 with gross proceeds exceeding $100.0 million; (b) 10 commercial, development and regulatory milestone payments up to an aggregate of $155.0 million and sales milestone payments up to an aggregate of $440.0 million based on respective thresholds of net sales of products developed from the licensed compound, if any; and (c) an annual earned royalty at a marginal royalty rate between in the mid-single to low-double digits (less than 20%), with increasing rates based on Net Sales in the respective calendar year, based on a percentage of sales within varying thresholds for a certain period of the year, if any year (collectively, “the “2022 Lilly Contingent Payments”). We will account for these contingent milestone payments as they become due. As of September 30, 2025, none of the 2022 Lilly Contingent Payments are due and accordingly will not be recorded in our financial statements until they are due. If a financing by Z33 with gross proceeds exceeding $100.0 million and corresponding payment of $3.0 million to Lilly does not occur by December 7, 2025, Lilly may terminate the 2022 Lilly License, unless by the same date, the Company makes a $3.0 million payment. As of September 30, 2025, no such payment has been made and will not be recorded in the Company’s financial statements until it is deemed probable.

Pfizer Agreement

On March 22, 2022, we entered into a license agreement and a Series A-1 Subscription and Shareholder’s Agreement (collectively, the “Pfizer Agreement”) with Pfizer. Under the Pfizer Agreement, we acquired a license for a compound previously developed by Pfizer.

In addition to the consideration paid and transferred during 2022 and 2023 and the first $1.0 million development milestone paid during 2024, we are obligated to make payments to Pfizer for (a) eleven (11) remaining future development and regulatory milestone payments aggregating up to $69.0 million and sales milestone payments up to an aggregate of $525.0 million based on respective thresholds of net sales of products (developed from the licensed compound) (the “Products”), if any; and (b) an annual earned royalty at a marginal royalty rate in the mid-single digits to low double digits (less than 20%), based on thresholds of net sales of Products, if

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any (collectively, the “Pfizer Contingent Payments”). Royalties are payable on a country-by-country basis for a certain period of years or upon the later expiration of regulatory exclusivity of our Products in a country.

As of September 30, 2025, no additional Pfizer Contingent Payments are due and accordingly no additional Pfizer Contingent Payments will be recorded in our financial statements until they are due.

Impact of Global Economic Trends

Macroeconomic conditions, including uncertainties associated with the changes to and by the United States federal government administration, the current U.S. government shutdown, the ongoing conflicts in the Middle East, the ongoing conflict between Ukraine and Russia, international trade policies (including tariffs, sanctions and trade barriers), economic slowdowns, public health crises, labor shortages, recessions or market corrections, supply chain disruptions, inflation and monetary policy shifts, liquidity concerns at, and failures of, banks and other financial institutions or other disruptions in the banking system or financing markets, rising interest rates and financial and credit market fluctuations, volatility in the capital markets or other evolving macroeconomic developments, continue to have direct and indirect impacts on our business and could in the future materially impact our results of operations and financial condition. Recent tariffs and trade restrictions have increased costs and complexity for many businesses, which we expect to have an adverse impact on our business. We continue to actively monitor the impact of these macroeconomic factors on our results of operations, financial condition and cash flows. The extent of the impact of these factors on our operational performance and financial condition, including our ability to execute our business strategies and initiatives in the expected timeframe, will depend on future developments, which are uncertain and cannot be predicted; however, any continued or renewed disruption resulting from these factors could negatively impact our business.

Components of Operating Results

Operating Expenses

Research and Development Expenses

Research and development (“R&D”) expenses consist of all direct and indirect operating expenses supporting the processes and manufacturing in development, including consulting fees for clinical and manufacturing advisory services, contract research organization (“CRO”) costs, costs related to manufacturing material for clinical studies, payroll and benefits, which includes share-based compensation for research and development employees, licensing fees, and data and study acquisition costs. Expenses are recognized as the related goods are delivered or the services are performed.

R&D expenses include the cost of in-process research and development (“IPR&D”) assets purchased in an asset acquisition transaction. IPR&D assets are expensed provided that the acquired asset did not also include processes or activities that would constitute a “business” as defined under United States Generally Accepted Accounting Principles (“U.S. GAAP”), the drug has not achieved regulatory approval for marketing and, absent obtaining such approval, has no established alternative future use. Acquired IPR&D payments, including upfront payments, transaction fees and subsequent pre-commercial milestone payments, are immediately expensed in the period in which they are incurred. Research and development costs incurred after the acquisition are expensed as incurred. R&D expenses also include the remeasurement of the research and development license consideration liability.

Research and development expenses could include:

External Expenses:

● external research and development expenses incurred under agreements with CROs, investigative sites and consultants to conduct our clinical trials;

● costs related to manufacturing material for preclinical studies and clinical trials, including fees paid to contract manufacturing organizations (“CMOs”);

● milestone payments under our licensing agreements;

● laboratory supplies and research materials; and

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● costs related to compliance with regulatory requirements.

Internal Expenses:

● employee-related expenses, including salaries, bonuses, benefits, share-based compensation and other related costs for those employees involved in research and development efforts.

A significant portion of our research and development costs have been external expenses. We utilize third-party contractors for our research and development activities. We track these external expenses on an individual program basis within our portfolio, when they are specific to an individual program, once a clinical product candidate or program has been identified.

We use CMOs for our manufacturing activities and we do not have our own laboratory or manufacturing facilities. Therefore, we have no material facilities expenses attributed to research and development. We track our manufacturing activities on a portfolio basis when we have multiple programs in a portfolio, but do not track these activities on a program basis within the portfolio, as these costs are deployed across multiple programs within a portfolio.

Our internal research and development costs are primarily personnel-related costs. We do not track internal costs on a portfolio or program specific basis because these costs are deployed across multiple programs and, as such, are not separately classified.

Research and development activities are central to our business model. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. We plan to substantially increase our research and development expenses for the foreseeable future as we develop our product candidates and manufacturing processes and conduct discovery and research activities for our clinical programs. We cannot determine with certainty the timing of initiation, the duration or the completion costs of current or future clinical studies of our product candidates due to the inherently unpredictable nature of clinical development. Clinical development timelines, the probability of success and development costs can differ materially from expectations. We anticipate that we will make determinations as to how we pursue our product candidates and how much funding to direct to each program on an ongoing basis in response to the results of future clinical trials, regulatory developments and our ongoing assessments as to commercial potential. We will need to raise substantial additional capital in the future. Our clinical development costs are expected to increase as we commence, continue and expand our clinical trials. Our future expenses may vary significantly each period based on factors such as:

● expenses incurred to conduct preclinical studies required to advance our product candidates into clinical trials;

● per patient clinical trial costs, including based on the number of doses that patients receive;

● the number of patients who enroll in each clinical trial;

● the number of clinical trials required for approval;

● the number of sites included in the clinical trials;

● the countries in which the clinical trials are conducted;

● the length of time required to enroll eligible patients;

● the drop-out or discontinuation rates of patients;

● potential additional safety monitoring requested by regulatory agencies;

● the duration of patient participation in clinical trials and follow-up;

● the phase of development of the product candidate;

● third party contractors failing to comply with regulatory requirements or meet their contractual obligations in a timely manner, or at all;

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● the cost of insurance, including product liability insurance, in connection with clinical trials;

● regulators or institutional review boards requiring that we or our investigators suspend or terminate clinical development for various reasons, including noncompliance with regulatory requirements or a finding that the participants are being exposed to unacceptable health risks; and

● the efficacy and safety profile of our product candidates.

General and Administrative Expenses

General and administrative (“G&A”) expenses primarily consist of professional fees for legal, accounting, and consulting costs relating to corporate matters, as well as salaries and related costs for personnel in executive and administrative functions and board of director fees, including share-based compensation.

We anticipate that our general and administrative expenses will increase in the future as we continue to support research and development activities and incur increased costs of operating as a public company. These costs include increased headcount to support expanded operations and infrastructure.

Additionally, we anticipate increased costs associated with maintaining compliance with Nasdaq rules and SEC requirements such as accounting, audit, legal and consulting services, as well as director and officer liability insurance, investor and public relations activities.

Results of Operations

Comparison of the Three months ended September 30, 2025 and 2024

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

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the Three Months Ended

​

​

​

​

​

​

​

​

September 30,

$

%

​

​

2025

2024

Change

Change

Operating expenses:

​

​

​

​

​

​

​

​

​

​

​

Research and development

​

$

11,948

​

$

6,029

​

$

5,919

​

98

%

General and administrative

​

​

7,571

​

​

13,290

​

​

(5,719)

​

(43)

%

Total operating expenses

​

​

19,519

​

​

19,319

​

​

200

​

1

%

Loss from operations

​

​

(19,519)

​

​

(19,319)

​

​

(200)

​

1

%

Other (income)/expense, net:

​

​

​

​

​

​

​

​

​

​

​

Interest income

​

​

(1,526)

​

​

(2,461)

​

​

935

​

(38)

%

Change in fair value of private placement warrants

​

​

—

​

​

3,866

​

​

(3,866)

​

(100)

%

Other (income)/expense, net

​

​

47

​

​

(22)

​

​

69

​

*

%

Total other (income)/expense, net

​

​

(1,479)

​

​

1,383

​

​

(2,862)

​

(207)

%

Loss before income taxes

​

(18,040)

​

​

(20,702)

​

​

2,662

​

(13)

%

Income tax benefit

​

—

​

​

—

​

​

—

​

0

%

Net loss

​

(18,040)

​

​

(20,702)

​

​

2,662

​

(13)

%

Accretion of redeemable noncontrolling interest to redemption value(1)

​

(2,828)

​

​

(2,240)

​

​

(588)

​

(26)

%

Adjustment of redeemable noncontrolling interest(1)

​

​

831

​

​

—

​

​

831

​

100

%

Net loss attributable to Class A Ordinary Shareholders of Zura

$

(20,037)

​

$

(22,942)

​

$

2,905

​

13

%

* Percentage change not meaningful

(1) See “—Results of Operations—Accretion and Adjustment of Redeemable Noncontrolling Interest” below.

​

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Operating Expenses

Research and development expenses (in thousands):

The following table summarizes our research and development expenses for the periods presented (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the Three Months Ended

​

​

​

​

​

​

​

September 30,

​

$

​

%

​

2025

2024

Change

Change

External expenses:

​

​

​

​

​

​

Direct expenses by program:

​

​

​

​

​

​

Tibulizumab Portfolio

​

​

​

​

​

​

Tibulizumab SSc Program

​

$

3,054

​

$

920

​

​

2,134

​

232

%

Tibulizumab HS Program

​

2,657

​

7

​

​

2,650

​

*

%

Tibulizumab Combined (SSc and HS) Programs

​

2,726

​

2,635

​

​

91

​

3

%

Total Tibulizumab Portfolio

​

8,437

​

3,562

​

​

4,875

​

137

%

Additional product candidates (crebankitug and torudokimab)

​

481

​

363

​

​

118

​

33

%

Unallocated expenses

​

521

​

389

​

​

132

​

34

%

Internal expenses:

​

​

​

​

​

​

​

​

​

Personnel expenses (including share-based compensation)

​

2,509

​

1,715

​

​

794

​

46

%

Total research and development expense

​

$

11,948

​

$

6,029

​

​

5,919

​

98

%

* Percentage change not meaningful

Research and development expenses increased by $5.9 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. This increase was primarily due to:

● a $2.1 million and $2.7 million increase in costs as we advance our Phase 2 clinical trials evaluating tibulizumab in adults with SSc and HS, respectively, driven by costs incurred for CRO fees to support the conduct of our clinical trials;

● a $0.8 million increase in compensation, including share-based compensation, driven by increased personnel in research and development functions;

● a $0.1 million increase in costs related to our additional product candidates, crebankitug and torudokimab, as we continued to explore potential applications therapeutic indications where crebankitug may offer clinical and commercial value, and to monitor external data from IL-33/ST2-targeted programs to help inform our development strategy for torudokimab; and

● $0.1 million increase in unallocated non-portfolio specific research and development expenses due to our growth to support our advancement of our Phase 2 clinical trials and other product candidates.

We anticipate that research and development expenses will continue to increase in the future as we conduct research and development activities.

General and administrative expenses (in thousands):

General and administrative expenses decreased by $5.7 million for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The decrease was primarily due to a $5.9 million non-cash share-based compensation expense charge for the modification of awards for the former CEO during the three months ended September 30, 2024, partially offset by an increase in professional fees.

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Table of Contents

Other Expense (Income), net

Interest income

Interest income decreased by $0.9 million for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. This is primarily due to lower interest rates on our cash and cash equivalents balance during three months ended September 30, 2025 as compared to the three months ended September 30, 2024.

Change in fair value of private placement warrants

For the three months ended September 30, 2025, we did not have any private placement warrants as all private placement warrants were exchanged for Class A Ordinary Shares in August 2024. Revaluation loss on the liability-classified private placement warrants assumed in the Business Combination was $3.9 million during the three months ended September 30, 2024, prior to the exchange.

Other expense, net

Other expense, net was relatively consistent for each of the three months ended September 30, 2025 and 2024.

Accretion and Adjustment of Redeemable Noncontrolling Interest

For the three months ended September 30, 2025, there was a $0.8 million adjustment to the redeemable noncontrolling interest recognized as an adjustment to net loss attributable to Class A Ordinary shareholders of Zura as a result of the extinguishment and reclassification upon the exercise of the Put Option to an accrued expense. The redeemable noncontrolling interest balance was $8.7 million as of September 30, 2025 which represents the remaining 50% of the Z33 Series Seed Preferred Shares subject to the Put Right. Accretion of redeemable noncontrolling interest to redemption value was $2.8 million and $2.3 million for the three months ended September 30, 2025 and 2024, respectively, resulting from the remeasurement of the Z33 Series Seed Preferred Shares to redemption value, as the Z33 Series Seed Preferred Shares are recorded at the greater of the redemption value or the initial fair value, less noncontrolling shareholder’s interest in net loss of Z33.

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

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

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the Nine Months Ended

​

​

​

​

​

​

​

September 30,

​

$

​

%

​

2025

2024

Change

Change

Operating expenses:

​

​

​

​

​

​

​

​

​

​

​

​

Research and development

​

$

31,126

​

$

15,161

​

$

15,965

​

105

%

General and administrative

​

25,709

​

​

24,296

​

​

1,413

​

6

%

Total operating expenses

​

56,835

​

​

39,457

​

​

17,378

​

44

%

Loss from operations

​

(56,835)

​

​

(39,457)

​

​

(17,378)

​

44

%

Other (income)/expense, net:

​

​

​

​

​

​

​

​

​

​

​

Interest income

​

​

(5,060)

​

​

(5,872)

​

​

812

​

(14)

%

Change in fair value of private placement warrants

​

​

—

​

​

5,240

​

​

(5,240)

​

(100)

%

Other income, net

​

​

(300)

​

​

(47)

​

​

(253)

​

538

%

Total other income, net

​

​

(5,360)

​

​

(679)

​

​

(4,681)

​

689

%

Loss before income taxes

​

(51,475)

​

​

(38,778)

​

​

(12,697)

​

33

%

Income tax benefit

​

—

​

​

—

​

​

—

​

0

%

Net loss

​

​

(51,475)

​

​

(38,778)

​

​

(12,697)

​

33

%

Accretion of redeemable noncontrolling interest to redemption value(1)

​

​

(2,828)

​

​

(4,577)

​

​

1,749

​

38

%

Adjustment of redeemable noncontrolling interest(2)

​

​

831

​

​

7,017

​

​

(6,186)

​

(88)

%

Net loss attributable to Class A Ordinary Shareholders of Zura

​

$

(53,472)

​

$

(36,338)

​

$

(17,134)

​

(47)

%

*Percentage change not meaningful

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(1) See “—Results of Operations—Accretion of Redeemable Noncontrolling Interest” below.

(2) See “—Results of Operations—Adjustment of Redeemable Noncontrolling Interest” below.

Operating Expenses

Research and development expenses:

The following table summarizes our research and development expenses for the periods presented (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

For the Nine Months Ended

​

​

​

​

​

​

​

September 30,

​

$

​

%

​

2025

2024

Change

Change

External expenses:

​

​

​

​

​

​

​

​

​

​

​

​

Direct expenses by program:

​

​

​

​

​

​

​

​

​

​

​

​

Tibulizumab Portfolio

​

​

​

​

​

​

​

​

​

​

​

​

Tibulizumab SSc Program

​

$

7,251

​

$

1,123

​

​

6,128

​

546

%

Tibulizumab HS Program

​

5,931

​

​

7

​

​

5,924

​

84629

%

Tibulizumab Combined (SSc and HS) Programs

​

8,597

​

​

7,451

​

​

1,146

​

15

%

Total Tibulizumab Portfolio

​

21,779

​

​

8,581

​

​

13,198

​

154

%

Additional product candidates (crebankitug and torudokimab)

​

1,231

​

​

1,180

​

​

51

​

4

%

Unallocated expenses

​

1,454

​

​

882

​

​

572

​

65

%

Internal expenses:

​

​

​

​

​

​

​

​

​

​

​

​

Personnel expenses (including share-based compensation)

​

6,662

​

​

4,518

​

​

2,144

​

47

%

Total research and development expense

​

$

31,126

​

$

15,161

​

​

15,965

​

105

%

* Percentage change not meaningful

Research and development expenses increased by $16.0 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. This increase was primarily due to:

● a $6.1 million and $5.9 million increase in costs as we advance our Phase 2 clinical trials evaluating tibulizumab in adults with SSc and HS, respectively, driven by costs incurred for CRO fees to support the conduct of our clinical trials;

● a $2.1 million increase in compensation, including share-based compensation, driven by increased personnel in research and development functions;

● a $1.1 million increase in costs for tibulizumab that was not specific to an indication, primarily driven by an increase of $0.7 million in manufacturing costs for tibulizumab and

● $0.6 million increase in unallocated non-portfolio specific research and development expenses due to our growth to support our advancement of our Phase 2 clinical trials and other product candidates.

Costs related to our additional product candidates (crebankitug and torudokimab), remained relatively consistent for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. We anticipate that research and development expenses will continue to increase in the future as we conduct research and development activities.

General and administrative expenses (in thousands):

General and administrative expenses increased by $1.4 million for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The increase was primarily due to an increase in professional fees to support our growing organization as we advance our Phase 2 clinical trials evaluating tibulizumab in SSc and HS.

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Other Expense (Income), net

Interest income

Interest income decreased by $0.8 million for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The decrease was primarily due to lower interest rates on our cash and cash equivalents balance during the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024.

Change in fair value of private placement warrants

For the nine months ended September 30, 2025, we did not have any private placement warrants as all private placement warrants were exchanged for Class A Ordinary Shares in August 2024. Revaluation loss on the liability-classified private placement warrants assumed in the Business Combination was $5.2 million during the nine months ended September 30, 2024.

Other income, net

Other income, net increased $0.3 million for the nine months ended September 30, 2025 and compared to the nine months ended September 30, 2024 primarily due to the $0.3 million of R&D Incentive Credits received from the U.K. government (tax authority) in May 2025 for qualifying R&D expenses incurred as part of research projects.

Accretion of Redeemable Noncontrolling Interest to Redemption Value

Accretion of redeemable noncontrolling interest to redemption value was $2.8 million and $4.6 million for the nine months ended September 30, 2025 and 2024, respectively, resulting from the remeasurement of the Z33 Series Seed Preferred Shares to redemption value, as the Z33 Series Seed Preferred Shares were recorded at the greater of the redemption value or the initial fair value, less noncontrolling shareholder’s interest in net loss of Z33.

Adjustment of Redeemable Noncontrolling Interest

For the nine months ended September 30, 2025, there was a $0.8 million adjustment to the redeemable noncontrolling interest recognized as an adjustment to net loss attributable to Class A Ordinary Shareholders of Zura as a result of the extinguishment of 50% of the redeemable noncontrolling interest upon the exercise of the Put Option. For the nine months ended September 30, 2024, redeemable noncontrolling interest was adjusted from its redemption value to its initial fair value, decreased for the noncontrolling shareholder’s interest in net loss of Z33. This $7.0 million adjustment was the result of a decrease in the redemption price below the initial fair value, less the noncontrolling shareholder’s interest in net loss of Z33 as of September 30, 2024.

Liquidity and Capital Resources

Overview

Since our inception, we have not generated any revenue and expect to continue to incur significant operating losses for the foreseeable future and may never become profitable. As of September 30, 2025, we had cash and cash equivalents of $139.0 million. We have funded our operations through (i) the sale of equity, raising an aggregate of $10.0 million of gross proceeds from the sale of our convertible preferred shares of Zura Bio UK through March 31, 2023; (ii) the issuance of a promissory note, receiving net proceeds of $7.6 million in December 2022; (iii) proceeds from the Business Combination of $56.7 million in March 2023; (iv) the April 2023 Private Placement, raising an aggregate of $75.8 million in net cash proceeds; (v) the April 2024 Private Placement, raising an aggregate of $105.3 million in net cash proceeds; (vi) the sale of 1,500,000 Class A Ordinary Shares at a price of $3.80 per share under the ATM for net proceeds of $5.5 million, after sales agent commissions, in September 2024; and (vii) the sale of 3,000,000 Class A Ordinary Shares at a price of $1.75 per share under the ATM for net proceeds of $5.1 million, after sales agent commissions, in the first quarter of 2025.

We have experienced operating losses and cash outflows from operations since inception and will require ongoing financing in order to continue our research and development activities. We have not earned any revenue or reached successful commercialization of our products. Our future operations are dependent upon our ability to finance our cash requirements which will allow us to continue our research and development activities and the commercialization of our products. There can be no assurance that we will be successful in continuing to finance our operations.

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Table of Contents

Capital Requirements

To date, we have not generated revenue from any source, including the commercial sale of approved drug products, and we do not expect to generate revenue for at least the next few years. If we fail to complete the development of our product candidates in a timely manner or fail to obtain their regulatory approval, our ability to generate future revenue will be adversely affected. We do not know when, or if, we will generate any revenue from our product candidates, and we do not expect to generate revenue unless and until we obtain regulatory approval of, and commercialize, our product candidates.

We expect our expenses to continue to increase in connection with our ongoing activities, particularly as we continue the research and development, and seek marketing approval for our product candidates, as well as administrative costs associated with supporting our operations. In addition, if we obtain approval for any of our product candidates, we expect to incur significant commercialization expenses related to sales, marketing, manufacturing and distribution. Furthermore, we expect to incur additional costs associated with operating as a public company.

We will also be responsible to Pfizer and Lilly for significant future contingent payments under the Pfizer Agreement and the Lilly Licenses upon the achievement of certain development, regulatory, and sales milestones, as well as ongoing royalties on net commercial sales. The size and timing of these milestone payments will vary greatly depending upon a number of factors, and it is therefore difficult to estimate the total payments that could become payable to Pfizer and Lilly and when those payments would be due. If we achieve all of the milestones, we would be obligated to pay multimillion dollar development and regulatory milestone payments and sales milestone payments. We will be required to pay certain of these milestone payments prior to the time at which we are able to generate sufficient revenue, if any, from commercial sales of any of our product candidates. In addition to milestone payments, we are also required to pay Pfizer and Lilly under the Pfizer Agreement and Lilly Licenses, respectively, ongoing royalties in the mid-single digits to low double-digits (less than 20%) percentage range based upon thresholds of net sales of products.

We intend to continue devoting most of the net proceeds from the Business Combination, the April 2023 Private Placement, the April 2024 Private Placement and sales under the ATM to the preclinical and clinical development of our product candidates, our public company compliance costs and certain milestone payments. Based on our current business plans, we believe that our existing cash, cash equivalents and investments should be sufficient to fund our operating expenses and capital requirements through 2027. Our estimate as to how long we expect our existing cash and cash equivalents to be able to fund our operating expenses and capital requirements is based on assumptions that may prove to be wrong, and we could use our available capital resources sooner than we currently expect. Changing circumstances, some of which may be beyond our control, could result in less cash available to us or cause us to consume capital significantly faster than we currently anticipate, and we may need to seek additional funds sooner than planned.

Because of the numerous risks and uncertainties associated with research, development and commercialization of pharmaceutical drug products, we are unable to estimate the exact amount of our operating capital requirements. Our future funding requirements will depend on many factors, including, but not limited to:

● the extent to which we develop, in-license or acquire other product candidates and technologies in our product candidates pipeline;

● the costs and timing of process development and manufacturing scale-up activities associated with our product candidates and other programs as we advance them through preclinical and clinical development;

● the number and development requirements of product candidates that we may pursue;

● the costs, timing and outcome of regulatory review of our product candidates;

● the timing and amount of our milestone payments to Pfizer under the Pfizer Agreement and to Lilly under the Lilly Licenses;

● our headcount growth and associated costs as we expand our research and development capabilities and establish and expand our commercial infrastructure and operations;

● the costs and timing of future commercialization activities, including product manufacturing, marketing, sales and distributions, for any of our product candidates for which we receive marketing approval;

● royalty payments to Pfizer under the Pfizer Agreement and Lilly under the Lilly Licenses;

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Table of Contents

● royalty payments under the Stone Peach Letter Agreement and BAFFX17 Letter Agreement;

● 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;

● the revenue, if any, received from sales of our product candidates for which we receive marketing approval; and

● the costs of operating as a public company.

Identifying potential product candidates and conducting preclinical studies and clinical trials is a time-consuming, expensive and uncertain process that takes many years to complete, and we may never generate the necessary data or results required to obtain marketing approval and achieve product sales. In addition, our product candidates, if approved, may not achieve commercial success. Our commercial revenues, if any, will be derived from sales of our product candidates that we do not expect to be commercially available in the near term, if at all and are subject to successful clinical development and regulatory approval. Accordingly, we may need to continue to rely on additional financing to achieve our business objectives. Adequate additional financing may not be available to us on acceptable terms, or at all. To the extent that we raise additional capital through securities or debt financing, the terms of these securities or this debt may restrict our ability to operate. Any financing, if available, may involve covenants limiting and restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, entering into profit-sharing or other arrangements or declaring dividends. If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may be required 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. If we are unable to raise capital when needed or on acceptable terms, we could be forced to delay, reduce or eliminate our research and development programs or future commercialization efforts.

Cash Flows

The following table provides cash (used in) provided by operating, investing and financing activities (in thousands):

​	​	​	​	​	​	​
​	​	For the Nine Months Ended
​	​	September 30,
​		2025			2024
Net cash used in operating activities	​	$	(42,537)	​	$	(17,252)
Net cash used in investing activities	​		(96)	​	​	(5,030)
Net cash provided by financing activities	​		5,152	​	​	110,697
Net (decrease) increase in cash and cash equivalents	​	$	(37,481)	​	$	88,415

​

Cash flows from operating activities

Net cash used in operating activities increased by $25.3 million to $42.5 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. This increase was primarily due to an increase in our cash net loss of $22.0 million, which is comprised of a $12.7 million increase in net loss, as adjusted for the decrease in non-cash charges of $9.3 million, for the nine months ended September 30, 2025. The decrease in non-cash charges was due to a decrease of $4.2 million for share-based compensation expense for the nine months ended September 30, 2025 and a loss from the change in fair value on the private placement warrants of $5.2 million for the nine months ended September 30, 2024. Working capital changes resulted in increased cash used in operating activities of $3.3 million, resulting from higher prepaid expenses and other current assets and an increase in cash used in paying accounts payable and accrued expenses for the nine months ended September 30, 2025.

Cash flows from investing activities

Cash used in investing activities for the nine months ended September 30, 2025 was $0.1 million related to purchase of fixed assets. Cash used in investing activities for the nine months ended September 30, 2024 was $5.0 million which primarily related to the cash consideration paid to acquire the 2023 Lilly License.

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Table of Contents

Cash flows from financing activities

Cash provided by financing activities for the nine months ended September 30, 2025 was $5.2 million, which related to net proceeds of $5.1 million, after sales agent commissions, for the sale of Class A Ordinary Shares under our ATM and $0.1 million of proceeds from the exercise of share options.

Cash provided by financing activities for the nine months ended September 30, 2024 was $110.7 million, which related to net proceeds of $5.5 million, after sales agent commissions, for the sale of Class A Ordinary Shares under our ATM, $62.4 million of gross proceeds from the issuance of Class A Ordinary Shares in connection with the April 2024 Private Placement and $50.0 million of gross proceeds from the issuance of 2024 Pre-Funded Warrants in connection with the April 2024 Private Placement, partially offset by $7.2 million of transaction costs incurred in connection with such financing.

Contractual Obligations and Other Commitments

We have or will enter into agreements in the normal course of business with contract research organizations, contract manufacturing organizations and other vendors for research and development services for operating purposes, which are generally cancelable upon written notice. Some third party CMOs have intellectual property, such as patents and/or know-how with an annual fee and royalty bearing license to its customers that forms part of the manufacturing agreement.

Lonza License

In July 2022, we entered into a license agreement (the “Lonza License”) with Lonza Sales AG (“Lonza”) for a worldwide non-exclusive license for Lonza’s gene expression system in exchange for varying considerations depending on a number of factors such as whether we enter further into manufacturing agreements with Lonza or with a third party, and whether we enter into sublicense agreements with third parties (including up to middle six-figure annual payments per sublicense upon commencement of a sublicense, as well as royalties of up to low-single digit percentages of net sales of certain products over a commercially standard double-digit multi-year term). The Lonza License will remain in effect until terminated. We may terminate the Lonza License at any time upon 60 days’ notice, with or without cause. Lonza may terminate the Lonza License for cause upon a breach by us or for other commercially standard reasons.

Pursuant to the terms of the Lonza License, we have a license fee of $0.4 million due to Lonza annually in the fourth quarter as a result of manufacturing drug substance with a third party other than Lonza since 2023. For the year ended December 31, 2024, we recorded $0.4 million for the Lonza License, which is included in accounts payable and accrued expenses in the condensed consolidated balance sheet as of September 30, 2025 and December 31, 2024.

WuXi Biologics License

In July 2023, the Company entered into a biologics master services agreement (the “WuXi Biologics MSA”) with WuXi Biologics. Pursuant to the WuXi Biologics MSA, the parties enter into work orders setting forth the services and fees associated with drug substance and drug product activities and manufacturing for torudokimab, which fees are recognized as research and development expenses as incurred. Pursuant to the WuXi Biologics MSA, the Company entered into a cell line license agreement (the “Cell Line License Agreement”), which is further described below.

The Cell Line License Agreement was for certain of WuXi Biologics’ know-how, cell line, and biological materials (the “WuXi Biologics Licensed Technology”) to manufacture, have manufactured, use, sell and import certain products produced through the use of the cell line licensed by WuXi Biologics under the Cell Line License Agreement (the “WuXi Biologics Licensed Products”). If we manufacture all of our commercial supplies of bulk drug product for WuXi Biologics Licensed Products with a manufacturer other than WuXi Biologics or its affiliates, we are required to make royalty payments to WuXi Biologics in an amount equal to a fraction of a single digit percentage of global net sales of WuXi Biologics Licensed Products manufactured by a third-party manufacturer (the “Royalty”). If we manufacture part of our commercial supplies of the WuXi Biologics Licensed Products with WuXi Biologics or its affiliates, then the Royalty will be reduced accordingly on a pro rata basis. The Cell Line License Agreement will continue indefinitely unless terminated (i) by us upon three months’ prior written notice and its payment of all undisputed amounts due to WuXi Biologics through the effective date of termination, (ii) by WuXi Biologics for a material breach by us that remains uncured for 30 days after written notice, or (iii) by WuXi Biologics if we fail to make a payment and such failure continues for 30 days after receiving notice of such failure. As of September 30, 2025, there are no payments currently due under the Cell Line License Agreement.

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Table of Contents

Critical Accounting Estimates

Management’s discussion and analysis of our financial condition and results of operations is based on our unaudited interim condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP, and on a basis consistent with those accounting principles followed by us and disclosed in Note 2 to our most recent annual audited consolidated financial statements in the 2024 Annual Report. The preparation of these unaudited interim condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions and any such differences may be material.

There have been no material changes to our critical accounting policies and estimates since December 31, 2024. For a description of our critical accounting policies that affect our significant judgements and estimates used in preparation of our unaudited condensed consolidated financial statements, refer to Item 7 in “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contained in the 2024 Annual Report.

Recent Accounting Pronouncements

See Note 2 to our unaudited condensed consolidated financial statements located in “Part I – Financial Information, Item 1. Financial Statements” in this Quarterly Report for a description of recent accounting pronouncements applicable to our financial statements.

Emerging Growth Company and Smaller Reporting Company Status

In April 2012, the JOBS Act was enacted. Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (“Securities Act”) for complying with new or revised accounting standards. Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. Upon closing of the Business Combination, we remained an emerging growth company and may elect to extend the transition period for complying with new or revised accounting standards, which delays the adoption of these accounting standards until they would apply to private companies.

In addition, as an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies. These provisions include:

● being permitted to present only two years of audited financial statements in addition to any required unaudited interim financial statements, with correspondingly reduced disclosure in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations”;

● an exception from compliance with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended;

● reduced disclosure about our executive compensation arrangements in our periodic reports, proxy statements and registrations statements; and

● exemptions from the requirements of holding non-binding advisory votes on executive compensation or golden parachute arrangements; and an exemption from compliance with the requirements of the Public Company Accounting Oversight Board regarding the communication of critical audit matters in the auditor’s report on financial statements.

We would cease to qualify as an emerging growth company on the date that is the earliest of: (i) December 31, 2026, (ii) the last day of the fiscal year in which we have more than $1.235 billion in total annual gross revenues, (iii) the date on which we are deemed to be a “large accelerated filer” under the rules of the SEC, which means the market value of our Class A Ordinary Shares that is held by non-affiliates exceeds $700.0 million as of the prior June 30th, or (iv) the date on which we have issued more than $1.0 billion of non-convertible debt over the prior three-year period. We may choose to take advantage of some but not all of these reduced reporting burdens. We have taken advantage of certain reduced reporting requirements in this Quarterly Report. Accordingly, the information contained herein may be different than you might obtain from other public companies in which you hold equity interests.

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We are also a “smaller reporting company” as defined under the Securities Act and Securities Exchange Act of 1934, as amended (the “Exchange Act”). We may continue to be a smaller reporting company so long as either (i) the market value of Class A Ordinary Shares held by non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year and the market value of Class A Ordinary Shares held by non-affiliates is less than $700 million. If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and have reduced disclosure obligations regarding executive compensation, and, similar to emerging growth companies, if we are a smaller reporting company under the requirements of (ii) above, we would not be required to obtain an attestation report on internal control over financial reporting issued by our independent registered public accounting firm.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As a “smaller reporting company,” as defined by Item 10 of Regulation S-K, we are not required to provide the information otherwise required by this Item 3.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act, is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management including our Chief Executive Officer, Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. As of September 30, 2025, our Chief Executive Officer and Chief Financial Officer carried out an evaluation with the participation of management of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of September 30, 2025.

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the quarter ended September 30, 2025, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Internal Controls

A control system, no matter how well designed and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives. In reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. In addition, the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

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PART II —OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we may become involved in litigation or other legal proceedings arising in the ordinary course of our business. We are not currently a party to any material litigation or legal proceedings that, in the opinion of our management, are likely to have a material adverse effect on our business. Regardless of outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, negative publicity, reputational harm and other factors.

Item 1A. Risk Factors.

Below we are providing, in supplemental form, updates to our risk factors from those previously disclosed in Part I, Item 1A of our 2024 Annual Report. Our risk factors disclosed in Part I, Item 1A of our 2024 Annual Report provide additional discussion regarding these supplemental risks and we encourage you to read and carefully consider all of the risk factors disclosed in Part I, Item 1A of our 2024 Annual Report, together with the below, for a more complete understanding of the risks and uncertainties material to our business.

Disruptions at the FDA, EMA, the European Commission and other applicable U.S. and foreign government agencies and regulatory authorities caused by funding shortages, furloughs or other concerns could hinder their ability to hire and retain key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, or otherwise prevent those authorities from performing normal business functions on which the operation of our business may rely, which could significantly harm our business, financial condition, results of operations and prospects.

The ability of the FDA, EMA, the European Commission or any other applicable foreign regulatory authority to review and approve new products can be affected by a variety of factors, including government budget and funding levels, ability to hire and retain key personnel, ability to accept the payment of user fees, statutory, regulatory, and policy changes, and other events that may otherwise affect the FDA, EMA, the European Commission, or any other applicable foreign regulatory authority’s ability to perform routine functions. Average review times at the authorities have fluctuated in recent years as a result and could be delayed. In addition, government funding of the SEC and other government authorities on which our operations may rely, including those that fund research and development activities is subject to the political process, which is inherently fluid and unpredictable.

Disruptions at the FDA and other agencies or comparable foreign regulatory authorities may also slow the time necessary for new drugs to be reviewed and/or approved by necessary government authorities, which would adversely affect our business. For example, over the last several years, including during the ongoing government shutdown that began on October 1, 2025 and the government shutdown that lasted for 35 days beginning on December 22, 2018, the U.S. government has shut down several times and certain regulatory agencies, such as the FDA, have had to furlough critical FDA employees and stop critical activities. If, as a result of a prolonged government shutdown or otherwise, the FDA or other regulatory authorities are unable to timely conduct their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

International trade policies, including tariffs, sanctions and trade barriers may adversely affect our business, financial condition, results of operations and prospects.

We operate in a global economy, which includes utilizing third-party suppliers in several countries outside the United States. There is inherent risk, based on the complex relationships among the United States and the countries in which we conduct our business, that political, diplomatic and national security factors can lead to global trade restrictions and changes in trade policies and export regulations that may adversely affect our business and operations. The current international trade and regulatory environment is subject to significant ongoing uncertainty. The United States (“U.S.”) government has announced substantial new tariffs affecting a wide range of products and jurisdictions and has indicated an intention to continue developing new trade policies, including with respect to the pharmaceutical industry. In response, certain foreign governments have announced or implemented retaliatory tariffs and other protectionist measures. These developments have created a dynamic and unpredictable trade landscape, which may adversely impact our business, results of operations, financial condition and prospects. The Bureau of Industry and Security, U.S. Department of Commerce, has initiated an investigation to determine whether pharmaceutical ingredients, including finished drug product, manufactured outside of the United States pose a national security risk and should be subject to additional tariffs.

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We do not own or operate, and currently have no plans to establish, any manufacturing facilities. We currently rely, and expect to continue to rely, on third parties for the manufacture of our product candidates for clinical testing, as well as for manufacture of any products that we may commercialize, if approved. Currently, several of our manufacturers and suppliers, including drug substances and drug products for tibulizumab, torudokimab, and crebankitug, are located outside of the United States, and our principal suppliers of critical raw materials are located in Italy, the Netherlands, and the United Kingdom. We also rely on specialized laboratory equipment, supplies, materials, and precursor compounds, all or part of which we believe may be ultimately sourced from multiple countries outside the United States, to advance our research and development efforts.

Additionally, we are party to a cell line license agreement (the “Cell Line License Agreement”) with WuXi Biologics, a manufacturer located in China, and its affiliates (“WuXi Biologics”), which provides us with a non-exclusive, worldwide, sublicensable license to certain of WuXi Biologics’ know-how, cell line and biological materials to manufacture, have manufactured, use, sell and import certain products produced through the use of the cell line licensed by WuXi Biologics under the Cell Line License Agreement. If we have product manufactured at WuXi Biologics in the future, we may face additional manufacturing and supply-chain risks due to the regulatory and political structure of the PRC, or as a result of the international relationship with the PRC, including but not limited to sanctions, tariffs and other restrictions that have been or may be imposed.

Current or future tariffs will result in increased research and development expenses, including with respect to increased costs associated with APIs, raw materials, laboratory equipment and research materials and components. In addition, such tariffs will increase our supply chain complexity and could also potentially disrupt our existing supply chain. Unlike consumer goods, pharmaceuticals face unique regulatory constraints that make rapid supply chain adjustments particularly difficult and costly. Trade restrictions affecting the import of materials necessary for clinical trials could result in delays to our development timelines. Increased development costs and extended development timelines could place us at a competitive disadvantage compared to companies operating in regions with more favorable trade relationships and could reduce investor confidence, negatively impacting our ability to secure additional financing on favorable terms or at all. As we advance toward commercialization in the future, tariffs and trade restrictions could hinder our ability to establish cost-effective production capabilities, negatively impacting our growth prospects. In addition, in the event Most-Favored-Nation pricing for pharmaceutical products is implemented and applicable to any of our product candidates that may receive regulatory approval, our revenue opportunities may be adversely affected.

The complexity of announced or future tariffs may also increase the risk that we or our suppliers may be subject to civil or criminal enforcement actions in the United States or foreign jurisdictions related to compliance with trade regulations. Foreign governments may also adopt non-tariff measures, such as procurement preferences or informal disincentives to engage with, purchase from or invest in U.S. entities, which may limit our ability to compete internationally and attract non-U.S. investment, employees, customers and suppliers. Foreign governments may also take other retaliatory actions against U.S. entities, such as decreased intellectual property protection, increased enforcement actions, or delays in regulatory approvals, which may result in heightened international legal and operational risks. In addition, the United States and other governments have imposed and may continue to impose additional sanctions, such as trade restrictions or trade barriers, which could restrict us from doing business directly or indirectly in or with certain countries or parties and may impose additional costs and complexity to our business.

Trade disputes, tariffs, restrictions and other political tensions between the United States and other countries may also exacerbate unfavorable macroeconomic conditions including inflationary pressures, foreign exchange volatility, financial market instability, and economic recessions or downturns. The ultimate impact of current or future tariffs and trade restrictions remains uncertain and could materially and adversely affect our business, financial condition, and prospects. While we actively monitor these risks, any prolonged economic downturn, escalation in trade tensions, or deterioration in international perception of U.S.-based companies could materially and adversely affect our business, ability to access the capital markets or other financing sources, results of operations, financial condition and prospects. In addition, tariffs and other trade developments have and may continue to heighten the risks related to the other risk factors described in our 2024 Annual Report, as supplemented by the risk factors described in this Quarterly Report.

Preclinical and clinical development involves a lengthy and expensive process with uncertain outcomes, and results of earlier studies and trials may not be predictive of future clinical trial results.

Our clinical trials may not be conducted as planned or completed on schedule, if at all, and a failure of one or more clinical trials can occur at any stage. The outcome of preclinical studies and early-stage clinical trials may not be predictive of the success of later clinical trials, and the outcome of preclinical studies and early-stage clinical trials for a product candidate for a particular indication may not be predictive of the success of preclinical studies and early-stage clinical trials for the same product candidate for a different indication. Unexpectedly favorable results for the standard of care in any Phase 2 or Phase 3 trial could lead to unfavorable comparisons to the ZB Assets. Historically, placebo response rates in dermatologic conditions such as HS have been high, and may complicate the

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interpretation of clinical results. Moreover, preclinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that have believed their product candidates performed satisfactorily in preclinical studies and clinical trials have nonetheless failed to obtain investor support for continued development and financing or regulatory authority marketing approval of their product candidates.

We cannot guarantee that any clinical trials will be initiated or conducted as planned or completed on schedule, if at all. We also cannot be sure that submission of an IND or similar application will result in the FDA, EMA, or other regulatory authority, as applicable, allowing clinical trials to begin in a timely manner, if at all. Moreover, even if these trials begin, issues may arise that could cause regulatory authorities to suspend or terminate such clinical trials. Events that may prevent successful or timely initiation or completion of clinical trials include: inability to generate timely or sufficient preclinical, toxicology or other in vivo or in vitro data to support the initiation or continuation of clinical trials; delays in reaching a consensus with regulatory authorities on study design or implementation of the clinical trials; delays or failure in obtaining regulatory authorization to commence a trial; delays in reaching agreement on acceptable terms with prospective CROs and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and clinical trial sites; delays in identifying, recruiting and training suitable clinical investigators; delays in obtaining required institutional review board (“IRB”) approval at each clinical trial site, including delays relating to translation of materials for foreign clinical sites; failure to requalify drug substance or drug product for use in clinical trials; failure to demonstrate comparability of drug substance or drug product for regulatory authorization; delays in manufacturing, testing, releasing, validating or importing/exporting sufficient stable quantities of the ZB Assets for use in clinical trials, or the inability to do any of the foregoing; failure by our CROs, other third parties or us to adhere to clinical trial protocols; failure to perform in accordance with the FDA’s or any other regulatory authority’s GCPs or applicable regulatory guidelines in other countries; changes to the clinical trial protocols; clinical sites deviating from trial protocol or dropping out of a trial; changes in regulatory requirements and guidance that require amending or submitting new clinical protocols; selection of clinical endpoints that require prolonged periods of observation or analyses of resulting data; transfer of manufacturing processes to larger-scale facilities operated by a contract manufacturing organization (“CMO”) and delays or failure by our CMOs or us to make any necessary changes to such manufacturing process; delays or failure in completing technology transfer for the ZB Assets; delays or failure in obtaining or releasing drug substance or drug product from licensors or third parties; licensors or third parties being unwilling or unable to perform quality control testing of drug substance or drug product; licensors or third parties being unwilling or unable to provide a right of reference to preclinical, manufacturing or clinical data for the ZB Assets; and licensors or third parties being unwilling or unable to satisfy their contractual obligations to us.

We could also encounter delays if a clinical trial is suspended or terminated by us, by the IRBs of the institutions in which such clinical trials are being conducted, by the Data Safety Monitoring Board, if any, for such clinical trial or by the FDA or other regulatory authorities. Such authorities may suspend or terminate a clinical trial due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical trial protocols, inspection of the clinical trial operations or trial site by the FDA, EMA, or other regulatory authorities resulting in the imposition of a clinical hold, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from the ZB Assets, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial. If we are required to conduct additional clinical trials or other testing of the ZB Assets beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of the ZB Assets, if the results of these trials are not positive or are only moderately positive or if there are safety concerns, our business and results of operations may be adversely affected and we may incur significant additional costs.

We face substantial competition, which may result in others discovering, developing, licensing or commercializing products before or more successfully than we do.

We face substantial competition from major pharmaceutical companies and biotechnology companies worldwide. Many of our competitors have significantly greater financial, technical and human resources. Smaller and early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. As a result, our competitors may discover, develop, license or commercialize products before or more successfully than we do.

Furthermore, pharmaceutical companies that develop and/or market products for the indications we are pursuing are likely to represent substantial competition. These include companies actively developing and/or marketing IL-7R inhibitors (such as Q32 Bio Inc. and OSE Immunotherapeutics SA), TSLPR inhibitors (such as Upstream Bio, Inc.), IL-33 inhibitors (such as Regeneron Pharmaceuticals, Inc. / Sanofi and AstraZeneca plc), ST2 inhibitors (such as Roche Holding AG / Genentech, Inc.), IL-17A inhibitors (such as MoonLake Immunotherapeutics, UCB SA, and Novartis AG), and BAFF inhibitors (such as GSK plc and Novartis AG). The above mechanisms may be of potential therapeutic use in one or more of the indications we plan to pursue in the Phase 2 program. If the ZB Assets do not offer sustainable advantages over competing products, we may otherwise not be able to successfully compete

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against current and future competitors. Conversely, mixed or negative results from competitors developing comparable mechanisms of action may adversely affect the outlook for our product candidates.

Our competitors may obtain regulatory approval of their products more rapidly than we may or may obtain patent protection or other intellectual property rights that limit our ability to develop or commercialize the ZB Assets. Our competitors may also develop drugs that are more effective, more convenient, more widely used or less costly or have a better safety profile than the ZB Assets and these competitors may also be more successful than us in manufacturing and marketing their products.

Furthermore, we also face competition more broadly across the market for existing cost-effective and reimbursable treatments for T-cell and B-cell mediated diseases, autoimmune diseases, and inflammatory diseases. The ZB Assets, if approved, may compete with these existing drug and other therapies but may not be competitive with them in price. We expect that if the ZB Assets are approved, they will be priced at a significant premium over biosimilar and generic, including branded generic, products. As a result, obtaining market acceptance of, and gaining significant share of the market for the ZB Assets will pose challenges.

Healthcare legislative and regulatory reform discourse and potential or enacted measures may have a material adverse impact on our business and results of operations and legislative or political discussions surrounding the desire for and implementation of pricing reforms may adversely impact our business.

In the United States and some foreign jurisdictions, there have been, and continue to be, several legislative and regulatory changes and proposed changes regarding healthcare systems that could prevent or delay marketing approval of product candidates, restrict or regulate post-approval activities, and affect our ability to profitably sell any product candidates for which we obtain marketing approval.

Payors, whether domestic or foreign, or governmental or private, are developing increasingly sophisticated methods of controlling healthcare costs and those methods are not always specifically adapted for new technologies. In both the United States and certain foreign jurisdictions, there have been a number of legislative and regulatory changes that could impact our ability to sell our products profitably. In particular, in 2010, the Patient Protection and ACA was enacted, which, among other things, subjected biologic products to potential competition by lower-cost biosimilars; addressed a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected; increased the minimum Medicaid rebates owed by most manufacturers under the Medicaid Drug Rebate Program; extended the Medicaid Drug Rebate program to utilization of prescriptions of individuals enrolled in Medicaid managed care organizations; subjected manufacturers to new annual fees and taxes for certain branded prescription drugs; created a new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D; and provided incentives to programs that increase the federal government’s comparative effectiveness research.

There has been heightened governmental scrutiny recently over the manner in which drug manufacturers set prices for their marketed products, which have resulted in several U.S. presidential executive orders, Congressional inquiries, proposed and enacted federal and state legislation, and other regulatory actions designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, reform government program reimbursement methodologies for drug products, and otherwise reduce drug prices. For example, the Inflation Reduction Act of 2022 (“IRA”), among other things, (1) extends enhanced subsidies for individuals purchasing health insurance coverage through plan year 2025 in the Patient Protection and ACA marketplaces, (2) eliminates the “donut hole” under the Medicare Part D program beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost and through a newly established manufacturer discount program, (3) directs HHS to negotiate the price of certain single-source drugs covered under Medicare that have been on the market for at least 7 years and (4) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation. These provisions began to take effect progressively in fiscal year 2023. On August 15, 2024, HHS announced the agreed-upon price of the first ten drugs that were subject to price negotiations, although the Medicare Drug Price Negotiation Program is currently subject to legal challenges. On January 17, 2025, HHS selected fifteen additional products covered under Part D for price negotiation in 2025. Each year thereafter more Part B and Part D products will become subject to the Medicare Drug Price Negotiation Program. Further, on December 7, 2023, an initiative to control the price of prescription drugs through the use of march-in rights under the Bayh-Dole Act was announced. On December 8, 2023, the National Institute of Standards and Technology published for comment a Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights which for the first time includes the price of a product as one factor an agency can use when deciding to exercise march-in rights. While march-in rights have not previously been exercised, it is uncertain if that will continue under the new framework. At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain

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product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

We cannot predict what healthcare reform initiatives may be adopted in the future. The current Trump administration is pursuing policies to reduce regulations and expenditures across government including at HHS, the FDA, the Centers for Medicare & Medicaid Services (“CMS”) and related agencies. These actions, presently directed by executive orders or memoranda from the Office of Management and Budget, may propose policy changes that create additional uncertainty for our business. These actions for example include (1) directives to reduce agency workforce and cut programs; (2) rescinding a Biden administration executive order tasking the Center for Medicare and Medicaid Innovation to consider new payment and healthcare models to limit drug spending; (3) eliminating the Biden administration’s executive order that directed HHS to establish an AI task force and develop a strategic plan; (4) directing HHS and other agencies to lower prescription drug costs through a variety of initiatives, including by improving upon the Medicare Drug Price Negotiation Program and establishing Most-Favored-Nation pricing for pharmaceutical products; (5) imposing tariffs of imported pharmaceutical products; and (6) and directing certain federal agencies to enforce existing law regarding hospital and plan price transparency and by standardizing prices across hospitals and health plans and (7) as part of the Make America Healthy Again (“MAHA”) Commission’s recent Strategy Report, working across government agencies to increase enforcement on direct-to-consumer pharmaceutical advertising. These actions and policies may significantly reduce U.S. drug prices, potentially impacting manufacturers’ global pricing strategies and profitability, while increasing their operational costs and compliance risks. Additionally, in its June 2024 decision in Loper Bright Enterprises v. Raimondo, the U.S. Supreme Court overturned the longstanding Chevron doctrine, under which courts were required to give deference to regulatory agencies’ reasonable interpretations of ambiguous federal statutes. The Loper Bright decision could result in additional legal challenges to current regulations and guidance issued by federal agencies applicable to our operations, including those issued by the FDA. Congress may introduce and ultimately pass health care related legislation that could, among others, impact the drug approval process and modify the Medicare Drug Price Negotiation Program, expand the orphan drug exclusion in the IRA, and reduce Medicaid enrollment and funding. We expect that these and other healthcare reform measures that may be adopted may result in more rigorous coverage criteria and in additional downward pressure on the price that we receive for any approved product. Reform measures that result in decreased physician reimbursement may adversely affect our business. Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private payors. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize our product candidates.

Since its enactment, there have been numerous judicial, administrative, executive, and legislative challenges to certain aspects of the ACA. It is unclear how other healthcare reform measures of the current U.S. federal government administration or future administrations or other efforts, if any, to amend or challenge the ACA, will impact our business.

There have been judicial and Congressional challenges and amendments to certain aspects of the ACA. For example, on August 16, 2022, the IRA was signed into law, which among other things, extends enhanced subsidies for individuals purchasing health insurance coverage in ACA marketplaces through plan year 2025. The IRA also eliminates the “donut hole” under the Medicare Part D program beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost and by creating a new manufacturer discount program. It is possible that the ACA will be subject to judicial or Congressional challenges in the future. It is unclear how such challenges and healthcare reform measures of the current U.S. federal government administration will impact the ACA.

Other legislative changes have been proposed and adopted since the ACA was enacted. For example, on July 4, 2025, the annual reconciliation bill, the “One Big Beautiful Bill Act,” or OBBBA, was signed into law which is expected to reduce Medicaid spending and enrollment by implementing work requirements for some beneficiaries, capping state-directed payments, reducing federal funding, and limiting provider taxes used to fund the program. OBBBA also narrows access to ACA marketplace exchange enrollment and declines to extend the ACA enhanced advanced premium tax credits, set to expire at the end of 2025, which, among other provisions in the law, are anticipated to reduce the number of Americans with health insurance. Other changes include aggregate reductions to Medicare payments to providers of 2% per fiscal year pursuant to the Budget Control Act of 2011, which began in 2013 and, due to subsequent legislative amendments to the statute, including the Infrastructure Investment and Jobs Act, will remain in effect until 2032 unless additional Congressional action is taken. Additionally, on March 11, 2021, the American Rescue Plan Act of 2021 was signed into law, which eliminates the statutory Medicaid drug rebate cap, previously set at 100% of a drug’s average manufacturer price, for single source and innovator multiple source drugs, effective January 1, 2024.

At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

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We are subject to laws and regulations related to privacy, data protection, information security and consumer protection across different markets where we conduct our business. Our actual or perceived failure to comply with such obligations could harm our business.

We are subject to laws and regulations related to, among other things, privacy, data protection, information security and consumer protection across different markets where we conduct our business. Such laws and regulations are constantly evolving and changing and are likely to remain uncertain for the foreseeable future. Our actual or perceived failure to comply with such obligations could have an adverse effect on our business, operating results and financial operations. Complying with these numerous, complex, and often changing regulations is expensive and difficult, and failure to comply with any privacy laws or data security laws or any security incident or breach involving the potential or actual misappropriation, loss or other unauthorized processing, use or disclosure of sensitive or confidential patient, consumer or other personal information, whether by us, one of our collaborators or another third party, could adversely affect our business, financial condition, and results of operations, including but not limited to investigation costs, material fines and penalties, compensatory, special, punitive, and statutory damages, litigation, consent orders regarding our privacy and security practices, requirements that we provide notices, credit monitoring services, and/or credit restoration services or relief.

European data collection is also governed by restrictive regulations governing the use, processing and cross-border transfer of personal information. The collection, use, storage, disclosure, transfer, or other processing of personal data regarding individuals in Europe, including personal health data, is subject to the E.U. General Data Protection Regulation (“GDPR”) and similar requirements in the United Kingdom (“UK GDPR”) (hereinafter the GDPR and UK GDPR are collectively referred to as “GDPR”), which impose strict requirements for processing the personal data of individuals within the EEA, such as Norway, Iceland, Liechtenstein and the United Kingdom. The GDPR is directly applicable in each E.U. member state and is extended to the EEA, while the UK GDPR applies to the United Kingdom of Great Britain and Northern Ireland. The GDPR is wide-ranging in scope and imposes numerous requirements on companies that process personal data, including requirements relating to processing health and other sensitive data, obtaining consent of the individuals to whom the personal data relates, providing information to individuals regarding data processing activities, implementing safeguards to protect the security and confidentiality of personal data, providing notification of data breaches, and taking certain measures when engaging third-party processors. The GDPR implements more stringent operational requirements than its predecessor legislation. Compliance with the GDPR is a rigorous and time-intensive process that may increase our cost of doing business or require us to change our business practices, and despite those efforts, there is a risk that we may be subject to fines and penalties, litigation, and reputational harm in connection with our European activities. For example, the GDPR applies extraterritorially, requires us to make more detailed disclosures to data subjects, requires disclosure of the legal basis on which we can process personal data, makes it harder for us to obtain valid consent for collecting and processing personal data (including data from clinical trials), requires the appointment of data protection officers, such as when sensitive personal data, such as health data, is processed on a large scale, provides more robust rights for data subjects, including far reaching information rights and the right to erasure, introduces mandatory data breach notification through the E.U., imposes additional obligations on us when contracting with service providers and requires us to adopt appropriate privacy governance, including policies, procedures, training, and audits. The GDPR provides that E.U. member states and EEA countries may establish their own laws and regulations that go beyond the GDPR in certain areas, such as regarding the mandatory appointment of data protection officers or further limiting the processing of personal data, including genetic, biometric, or health data, which could limit our ability to use and share personal data or could cause our costs to increase. Among other requirements, the GDPR regulates transfers of personal data subject to the GDPR to third countries that have not been found to provide adequate protection to such personal data, including the United States. In particular, the EEA and the UK have significantly restricted the transfer of personal data to the United States and other countries whose privacy laws it generally believes are inadequate. Other jurisdictions may adopt or have already adopted similarly stringent data localization and cross-border data transfer laws. In the ordinary course of business, we transfer personal data from Europe and other jurisdictions to the United States or other countries. Europe and other jurisdictions have enacted laws requiring data to be localized or limiting the transfer of personal data to other countries. Although there are currently various mechanisms that may be used to transfer personal data from the EEA and UK to the United States in compliance with law, such as the EEA standard contractual clauses, the UK’s International Data Transfer Agreement / Addendum, and the EU-U.S. Data Privacy Framework and the UK extension thereto (which allows for transfers to relevant U.S.-based organizations who self-certify compliance and participate in the Framework), these mechanisms are subject to legal challenges, and there is no assurance that we can satisfy or rely on these measures to lawfully transfer personal data to the United States. If there is no lawful manner for us to transfer personal data from the EEA, the UK or other jurisdictions to the United States, or if the requirements for a legally-compliant transfer are too onerous, we could face significant adverse consequences, including the interruption or degradation of our operations, the need to relocate part of or all of our business or data processing activities to other jurisdictions (such as Europe) at significant expense, increased exposure to regulatory actions, substantial fines and penalties, the inability to transfer data and work with partners, vendors and other third parties, and injunctions against our processing or transferring of personal data necessary to operate our business. Additionally, companies that transfer personal data out of the EEA and UK to other jurisdictions, particularly to the United States, are subject to increased scrutiny from regulators, individual litigants, and activist groups.

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Additionally, the U.S. Department of Justice issued a rule entitled the Preventing Access to U.S. Sensitive Personal Data and Government-Related Data by Countries of Concern or Covered Persons, which places additional restriction on certain data transactions involving countries of concern (e.g., China, Russia, Iran) and covered individuals (i.e., individuals and entities located in or controlled by individuals or entities located in those jurisdictions) that may impact certain business activities such as vendor engagements, sale or sharing of data, employment of certain individuals, and investor agreements. Violations of the rule could lead to significant civil and criminal fines and penalties. The rule applies regardless of whether data is anonymized, key-coded, pseudonymized, de-identified or encrypted, which presents particular challenges for companies like ours and may impact our ability to transfer data in connection with certain transactions or agreements.

We cannot assure you that our third-party service providers with access to our or our customers’, suppliers’, trial patients’ and employees’ personally identifiable and other sensitive or confidential information will not breach contractual obligations imposed by us, or that they will not experience data security breaches or attempts thereof, which could have a corresponding effect on our business, including putting us in breach of our obligations under privacy laws and regulations and/or which could in turn adversely affect our business, results of operations, and financial condition. We cannot assure you that our contractual measures and our own privacy and security-related safeguards will protect us from the risks associated with the third-party processing, use, storage, and transmission of such information. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations, and prospects.

Our internal computer systems, or those of any of the third parties with whom we work (including CROs, manufacturers, other contractors or consultants or potential future collaborators, may fail or suffer security or data privacy breaches or other unauthorized or improper access to, use of, or destruction of our proprietary or confidential data, employee data or personal data, which could result in additional costs, loss of revenue, significant liabilities, harm to our brand and material disruption of our operations.

Despite the implementation of security measures in an effort to protect systems that store our information, given their size and complexity and the increasing amounts of information maintained on our internal information technology systems and those of the third-parties with whom we work, such as CROs, other contractors (including sites performing our clinical trials) and consultants, these systems are potentially vulnerable to breakdown or other damage or interruption from service interruptions, system malfunction, natural disasters, terrorism, war and telecommunication and electrical failures, as well as security breaches from inadvertent or intentional actions by our employees, contractors, consultants, business partners and/or other third parties, or from cyber-attacks by malicious third parties (including traditional computer “hackers,” threat actors, “hacktivists,” organized criminal threat actors, sophisticated nation states, and nation-state supported actors), which may compromise our system infrastructure or lead to the loss, destruction, alteration or dissemination of, or damage to, our data and cause program delays that could negatively impact our ability to meet our desired clinical development timelines.

Such cyber-attacks may include, but are not limited to, social-engineering attacks (including through deep fakes, which are increasingly more difficult to identify as fake, and phishing attacks), malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks, credential stuffing attacks, credential harvesting, ransomware attacks, supply-chain attacks, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, attacks enhanced or facilitated by AI, and other similar threats. In particular, severe ransomware attacks are becoming increasingly prevalent and can lead to significant interruptions in our operations, ability to provide our products or services, loss of sensitive data and income, reputational harm, and diversion of funds. Extortion payments may alleviate the negative impact of a ransomware attack, but we may be unwilling or unable to make such payments due to, for example, applicable laws or regulations prohibiting such payments.

We rely on third parties to operate critical business systems to process sensitive information in a variety of contexts. Our ability to monitor these third parties’ information security practices is limited, and these third parties may not have adequate information security measures in place. If the third parties with whom we work experience a security incident or other interruption, we could experience adverse consequences. While we may be entitled to damages if the third parties with whom we work fail to satisfy their privacy or security-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such award. In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties’ infrastructure in our supply chain or that of the third parties with whom we work have not been compromised.

To the extent that any disruption or security breach were to result in a loss, destruction, unavailability, alteration or dissemination of, or damage to, our data or applications, or for it to be believed or reported that any of these occurred, we could incur liability and reputational damage and the development and commercialization of the ZB Assets could be delayed. For example, we have been the

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target of unsuccessful phishing attempts in the past, and expect such attempts will continue in the future. A security incident or other interruption could disrupt our ability (and that of third parties with whom we work) to provide our services.

Our contracts may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages, or claims related to our data privacy and security obligations. Further, our insurance policies may not be adequate to compensate us for the potential losses arising from any such disruption in, or failure or security breach of, our systems or third-party systems where information important to our business operations or commercial development is stored. In addition to experiencing a security incident, third parties may gather, collect, or infer sensitive information about us from public sources, data brokers, or other means that reveals competitively sensitive details about our organization and could be used to undermine our competitive advantage or market position.

Applicable data privacy and security obligations may require us, or we may voluntarily choose, to notify relevant stakeholders, including affected individuals, customers, regulators, and investors, of security incidents, or to take other actions, such as providing credit monitoring and identity theft protection services. Such disclosures and related actions can be costly, and the disclosure or the failure to comply with such applicable requirements could lead to adverse consequences. If we (or a third party with whom we work) experience a security incident or are perceived to have experienced a security incident, we may experience material adverse consequences, such as government enforcement actions (for example, investigations, fines, penalties, audits, and inspections); additional reporting requirements and/or oversight; restrictions on processing sensitive information (including personal data); litigation (including class claims); indemnification obligations; negative publicity; reputational harm; monetary fund diversions; diversion of management attention; interruptions in our operations (including availability of data); financial loss; and other similar harms.

Our business, reputation, financial condition and results of operations could be adversely affected by our ongoing internal review of certain agreements and other matters.

As previously disclosed, the audit committee of our board of directors formed an audit subcommittee to review our agreements and relationships with BAFFX17 and Stone Peach, among other matters. The audit subcommittee has engaged independent legal counsel to review the matters described therein. While such review is pending, we have not made the payments requested by BAFFX17 or Stone Peach or effected Stone Peach’s exercise of its Put Right and Put Option described in Note 5 to our unaudited condensed consolidated financial statements located in “Part I - Financial Information, Item 1. Financial Statements” in this Quarterly Report. The review, the outcome of the review and other events arising in connection with these matters may materially adversely impact our business, reputation, financial condition and results of operations. The review is still pending, and at this time, the Company cannot estimate the outcome or timing for completion of the review, and can therefore give no assurances regarding the ultimate outcome or impact on us. See “Part II - Item 5,” of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 for further information regarding the audit subcommittee review.

We are dependent on our key personnel and anticipate hiring additional key personnel. If we are not successful in attracting and retaining qualified personnel, including consultants, we may not be able to successfully implement our business strategy.

Our ability to compete in the highly competitive biotechnology and pharmaceutical industries depends upon our ability to attract and retain qualified managerial, scientific and medical personnel. We are dependent on our managerial, scientific and medical personnel, including our Chief Executive Officer, Chief Operating Officer, Chief Medical Officer, Chief Financial Officer and Chief Technology Officer. In July 2025, we transitioned to our current Chief Financial Officer, Eric Hyllengren, from our former Chief Financial Officer, Verender Badial. In addition, in October 2025, Robert Lisicki, our Chief Executive Officer and a member of our board of directors informed us that he is taking a medical leave of absence, effective October 10, 2025. Accordingly, effective October 10, 2025, our board of directors appointed Kim Davis, Chief Operating Officer, Chief Legal Officer and Corporate Secretary, to serve as interim Chief Executive Officer, in addition to her current duties. Changes in management could be disruptive to our business.

If we do not succeed in attracting and retaining qualified personnel, it could materially adversely affect our business, financial condition and results of operations. We could in the future have difficulty attracting and retaining experienced personnel and may be required to expend significant financial resources in our employee recruitment and retention efforts. We have relied upon and plan to continue to rely upon third parties, including consultants, to act in management roles for the Company. While we have agreements with such third parties, we do not have the same ability to influence their time commitment to the Company as we would if they were employees. Furthermore, we are dependent on our ability to attract, hire, relocate and retain qualified managerial, scientific and medical personnel from various jurisdictions. Therefore, immigration requirements may have a significant influence on our human resources planning. Immigration applications can take several months or more to be finalized. If we are unable to complete the requisite visa

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applications, either as a result of changing requirements or otherwise, our ability to successfully implement our business strategy could suffer, which could have a material adverse effect on our business, financial condition, results of operations and prospects.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

During the three months ended September 30, 2025, we issued 1,682,000 and 1,206,952 Class A Ordinary Shares in connection with the exercise of 2023 Pre-Funded Warrants and 2024 Pre-Funded Warrants, respectively. The exercise prices for such pre-funded warrants were immaterial.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Trading Arrangements

During the three months ended September 30, 2025, none of our directors or officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated any “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408 of Regulation S-K.

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Item 6. Exhibits.

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q:

Exhibit Number		Description
2.1		Third Amendment dated as of January 13, 2023 to the Business Combination Agreement by and among JATT Acquisition Corp., JATT Merger Sub, JATT Merger Sub 2, Zura Holdings, Ltd. and Zura Bio Limited (incorporated by reference to Exhibit 2.1 of JATT’s Current Report on Form 8-K (File No. 001-40598), filed with the SEC on January 19, 2023).
3.1	​	Second Amended and Restated Memorandum of Association of Zura Bio Limited (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K, filed with the SEC on March 24, 2023).
4.1	​	Specimen Warrant Certificate of Zura (incorporated by reference to Exhibit 4.6 of JATT’s Form S-4 (File No. 333-267005) filed with the SEC on August 19, 2022).
4.2	​	Form of Pre-Funded Warrant to Purchase Ordinary Shares (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the SEC on May 3, 2023).
4.3	​	Form of Pre-Funded Warrant to purchase Ordinary Shares (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed with the SEC on April 23, 2024).
4.4	​	Form of Warrant to purchase Ordinary Shares (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8 - K filed with the SEC on August 21, 2024).
4.5	​	Form of Warrant to purchase Ordinary Shares (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8 - K filed with the SEC on April 17, 2025).
10.1	​	Non-Employee Director Compensation Policy.
10.2†	​	Zura Bio Limited Executive Severance Benefit Plan (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on September 30, 2025).
31.1*		Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		XBRL Instance Document*
101.SCH		XBRL Taxonomy Extension Schema Document*
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document*
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document*
101.LAB		XBRL Taxonomy Extension Label Linkbase Document*
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document*
104	​	Cover Page Interactive Data File – The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

† Indicates management contract or compensatory plan or arrangement.

* Filed herewith.

** Furnished herewith.

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SIGNATURES

​

Pursuant to the requirements of Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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​	ZURA BIO LIMITED
​	​
Date: November 13, 2025	By:	/s/ Eric Hyllengren
	Name:	Eric Hyllengren
	Title:	Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

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51

FAQ

What was Zura Bio (ZURA) cash balance at quarter-end?

Cash and cash equivalents were $139.0 million as of September 30, 2025.

What loss did ZURA report for Q3 2025?

Zura reported a net loss of $18.0 million for the three months ended September 30, 2025.

How much did ZURA spend on R&D in Q3 2025?

Research and development expense was $11.9 million in Q3 2025.

What was ZURA’s operating cash burn year-to-date?

Net cash used in operating activities was $42.5 million for the nine months ended September 30, 2025.

How many shares were outstanding for ZURA?

Class A Ordinary Shares outstanding were 65,018,058 as of September 30, 2025, and 65,023,308 as of November 10, 2025.

Did ZURA raise capital during 2025?

Yes. Zura sold 3,000,000 shares under its ATM at $1.75, for $5.1 million in net proceeds.

What is ZURA’s lead program status?

The lead candidate, tibulizumab (ZB-106), is in Phase 2 trials targeting IL‑17A and BAFF.