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Borrowing | 6 Months Ended
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Jun. 30, 2026
Subordinated Borrowings [Abstract] |
Borrowing | 5. Borrowing Convertible Senior Notes Offering In June 2026, the Company completed its registered underwritten public offering of $250.0 million aggregate principal amount of 0.75% Convertible Senior Notes due 2032 (the “Notes”). The Company granted the underwriters an option, exercisable within 30 days of the offering, to purchase up to an additional $37.5 million aggregate principal amount of Notes, issued pursuant to the exercise in full of the overallotment option granted by the Company to the Underwriters (defined below). The Notes were sold pursuant to the Underwriting Agreement, dated June 25, 2026 with Jefferies LLC, Citigroup Global Markets Inc., and Cantor Fitzgerald & Co. as representatives of the several underwriters (the “Underwriters”). The Notes are general unsecured obligations of the Company and bear interest at a rate of 0.75% per year, payable semiannually in arrears on January 1 and July 1 of each year, beginning on January 1, 2027. The Notes will mature on July 1, 2032, unless earlier converted, redeemed or repurchased. The initial conversion rate for the Notes is 127.4941 shares of Class A Common Stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $7.84 per share of Class A Common Stock. The conversion rate for the Notes is subject to customary adjustments for certain events as described in the indenture governing the Notes, but will not be adjusted for accrued and unpaid interest. In addition, following certain corporate events that occur prior to the maturity date or if the Company delivers a notice of redemption in respect of the Notes, the Company will, in certain circumstances, increase the conversion rate of the Notes for a holder who elects to convert its Notes in connection with such a corporate event or convert its Notes called (or deemed called) for redemption during the related redemption period, as the case may be. The Company may not redeem the Notes prior to July 6, 2029. The Company has the option to redeem for cash all or any portion of the Notes (subject to certain limitations) on a redemption date on or after July 6, 2029 if the last reported sale price of the Class A Common Stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides the related notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the Notes, which means that the Company is not required to redeem or retire the Notes periodically. Holders may convert all or any portion of their Notes at their option at any time prior to the close of business on the business day immediately preceding April 1, 2032 only upon satisfaction of one or more of the following conditions: • at any time during the 30 consecutive trading day period beginning on, and including, the 21st trading day of any calendar quarter commencing after the calendar quarter ending on September 30, 2026, if the last reported sale price of the Class A Common Stock exceeds 130% of the conversion price for each of at least five trading days (whether or not consecutive) during the first 20 consecutive trading days of such calendar quarter; • during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of the Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Class A Common Stock and the conversion rate for the Notes on each such trading day; • if the Company calls such Notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date, but only with respect to the Notes called (or deemed called) for redemption; or • upon the occurrence of specified corporate events. On or after April 1, 2032 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their Notes at their option at any time, regardless of the foregoing conditions. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of Class A Common Stock, or a combination of cash and shares of Class A Common Stock, at the Company’s election, in the manner and subject to the terms and conditions provided in the indenture governing the Notes. The Notes are accounted for as long-term debt and are measured at amortized cost. Debt issuance costs of $7.4 million, including underwriting discounts and other offering costs, are recorded as a direct deduction from the carrying amount of the Notes and are amortized to interest expense over the contractual term of the Notes using the effective interest method. The following table presents the carrying amount of the Notes as of June 30, 2026.
|  | June 30, 2026 |
|  | (in thousands) |
Principal |  | $ | 250,000 |
Unamortized underwriter discounts and issuance costs |  |  | (7,376 | )
Net carrying amount |  | $ | 242,624 |
2026 Capped Call Transactions In connection with the issuance of the Notes, the Company entered into capped call transactions in June 2026 and July 2026 with certain counterparties at a net cost of approximately $17.1 million. The capped call transactions are expected generally to reduce the potential dilution to the Class A Common Stock upon any conversion of the Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or offset subject to a cap based on a cap price initially equal to $10.4580 per share, and is subject to certain adjustments under the terms of the capped call transactions. For accounting purposes, the capped call transactions described above are separate transactions, and not part of the terms of the Notes. As these transactions met certain criteria under the applicable accounting guidance, each of the capped call transactions were recorded in stockholders’ equity and were not accounted for as derivatives. The cost of the capped call transactions was recorded as a reduction of the Company’s additional paid-in capital in the Company’s condensed consolidated balance sheet and will not be remeasured. Loan Agreements On March 3, 2025 (the “Loan Closing Date”), the Company entered into a $100.0 million senior secured loan agreement (the “Loan Agreement”), with Sagard Holdings Manager LP (“Sagard”) as administrative agent, and the lenders party thereto. The $50.0 million tranche of the term loan was funded on June 25, 2025, following the U.S. Food and Drug Administration’s (“FDA”) approval of IBTROZI. The second tranche of $50.0 million of the term loan was available but not borrowed. In connection with the issuance of the Notes, on June 30, 2026, the Company used approximately $58.7 million of the net proceeds thereof to repay in full all outstanding obligations and terminate the Loan Agreement and pay an amendment fee under the Financing Agreement (as defined below). The Company recorded a $9.5 million loss on debt extinguishment as a result of this transaction. The senior secured loans under the Loan Agreement (the “Loans”) had a maturity date of September 30, 2030 and bore interest at a variable annual rate equal to the secured overnight financing rate (subject to a 4.00% floor) plus a margin of 6.00%, payable quarterly. The Company was required to pay a funding fee equal to a low single-digit percentage of each tranche, upon, and subject to, funding of such tranche, and an exit fee equal to a nominal percentage of each tranche upon repayment of such tranche. The Loan Agreement permitted voluntarily prepayment of the Loans at any time subject to a prepayment premium which, in connection with the prepayment on June 30, 2026, was equal to the amount of interest that would have been paid up to, but not including, June 25, 2027, plus 3.00% of the principal amount of the Loans being repaid. The obligations of the Company under the Loan Agreement were guaranteed by certain of its existing subsidiaries and were required to be guaranteed by subsequently acquired or organized subsidiaries, subject to certain exceptions (collectively, the “Guarantors”). The obligations of the Company under the Loan Agreement and the related guarantees thereunder were secured, subject to customary permitted liens and other agreed upon exceptions, by (i) a pledge of all of the equity interests of the Company’s and the Guarantors’ direct subsidiaries, and (ii) a perfected security interest in substantially all of the Company’s and the Guarantors’ tangible and intangible assets. The Loan Agreement contained customary representations and warranties and customary affirmative and negative covenants, including, among other things, restrictions on indebtedness, liens, investments, mergers, dispositions, prepayment of other indebtedness, and dividends and other distributions, subject to certain exceptions. In addition, the Loan Agreement contained a financial covenant requiring that the Company maintain not less than $25 million of cash and certain cash equivalent investments. Failure of the Company to comply with the financial covenant will result in an event of default, subject to certain cure rights of the Company other than under certain specified circumstances. The Loan Agreement contained events of default which are customary for financings of this type, in certain circumstances subject to customary cure periods. Following an event of default and any cure period, if applicable, Sagard had the right upon notice to terminate any undrawn commitments and may accelerate all amounts outstanding under the Loan Agreement, in addition to other remedies available to it as a secured creditor of the Company. Revenue Interest Financing Agreement On the Loan Closing Date, the Company also entered into a Revenue Interest Financing Agreement (as amended by the First Amendment to Revenue Interest Financing Agreement dated June 24, 2026, the “Financing Agreement”) with Sagard Healthcare Partners Funding Borrower SPE 2, LP (as assignee of Sagard Healthcare Partners (Delaware) II LP) (the “Investor”), pursuant to which the Investor paid the Company $150 million (the “Investment Amount”) on June 25, 2025, following the FDA’s approval of IBTROZI. In exchange for the Investment Amount, the Company agreed to make tiered royalty payments to the Investor (the “Payments”) on U.S. net sales of IBTROZI equal to 5.5% of annual U.S. net sales up to $600 million and 3.0% of annual U.S. net sales between $600 million and $1 billion. The Company retains all annual U.S. net sales above $1 billion. The obligation to make the Payments will cease upon the earliest occurrence of total Payments reaching 1.6 times of the Investment Amount by the calendar quarter ending on June 30, 2031, 1.75 times of the Investment Amount by the calendar quarter ending on June 30, 2034, or 2.0 times of the Investment Amount thereafter. The Company is required to make a true up payment to the Investor to the extent the Investor has not received Payments equaling at least 100% of the Investment Amount by February 1, 2043 in an amount equal to any such shortfall. The Company’s obligations under the Financing Agreement are secured, subject to customary permitted liens and other agreed upon exceptions, by a perfected security interest in (i) accounts receivable arising from U.S. net sales of IBTROZI and (ii) intellectual property, product registrations and regulatory approvals related to commercialization of IBTROZI in the United States. The Company has the right, but not the obligation (the “Call Option”), to buy out the Investor’s interest in the Payments at a repurchase price (the “Put/Call Price”) equal to (a) on or prior to the second anniversary of the Loan Closing Date, an amount equal to 140% of the Investment Amount, less all Payments made to the applicable repurchase date, (b) after the second anniversary but on or prior to August 1, 2031, an amount equal to 160% of the Investment Amount, less all Payments made to the applicable repurchase date, (c) after August 1, 2031 but on or prior to August 1, 2034, an amount equal to 175% of the Investment Amount, less all Payments made to the applicable repurchase date, and (d) after August 1, 2034, an amount equal to 200% of the Investment Amount, less all Payments made to the applicable repurchase date. The Financing Agreement contains customary representations and warranties and certain restrictions on the Company’s ability to incur indebtedness and grant liens on intellectual property, product registrations and regulatory approvals related to commercialization and development of taletrectinib in the United States. In addition, the Financing Agreement provides that if certain events (“Put Option Events”) occur, including certain bankruptcy events, non-payment of Payments, a change of control, expiration or termination of certain intellectual property rights or marketing authorization, an out-license or sale of all of the rights in and to taletrectinib in the United States and (subject to applicable cure periods) non-compliance with the covenants in the Financing Agreement, the Investor may require the Company to repurchase its interests in the Payments at the Put/Call Price. The Financing Agreement was recorded as debt at the time the funding occurred and is accounted for at amortized cost using the effective interest method. The Company uses the prospective method to account for changes in the effective interest rate arising from changes in the estimates of the revenue stream from the royalties. The following table shows the activity within the liability related to the Financing Agreement for the six months ended June 30, 2026:
|  | Liabilities Related to Financing Agreement |
|  | (in thousands) |
Carrying value of liability related to Financing Agreement at December 31, 2025 |  | $ | 155,404 |
Payments on Financing Agreement |  |  | (1,882 | )
Non-cash interest expense |  |  | 10,176 |
Amortization of issuance costs |  |  | 423 |
Carrying value of liability related to Financing Agreement at June 30, 2026 |  | $ | 164,121 |
Bank Loan In 2020, AnHeart entered into loan agreements with Bank of Hangzhou to obtain short-term borrowings to supplement its working capital. As of June 30, 2026, the outstanding balance net of repayments was $5.8 million. For the six months ended June 30, 2026, there were no borrowings or repayments. The fixed interest rate of these borrowings is 3.5% per annum.

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- Definition The entire disclosure for borrowings under subordinated debt agreements that qualify as available in computing net capital under SEC's uniform net capital rule, including restrictive covenants, collateral, interest rates and due dates, amounts due by date and amount owed in total. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 942 -SubTopic 470 -Name Accounting Standards Codification -Section 45 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147478878/942-470-45-1 + Details
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