GOSS

Business Context and Reporting Period

Gossamer Bio, Inc. is a late-stage clinical biopharmaceutical company focused on developing seralutinib for pulmonary hypertension (PH), including pulmonary arterial hypertension (PAH) and PH associated with interstitial lung disease (PH-ILD). This Form 10-Q covers the quarterly period ended September 30, 2025. The Company operates as a single segment and relies heavily on its collaboration with Chiesi Farmaceutici S.p.A. for revenue and development funding.

Key Financial Metrics

Material Changes vs. Prior Period

• Revenue Decline YTD: Total revenue for the nine months ended September 30, 2025, decreased by $70.7 million compared to the same period in 2024. This is primarily due to the absence of $88.8 million in license revenue recognized in Q2 2024 from the Chiesi Collaboration Agreement. Revenue from ongoing collaboration services increased by $18.1 million YTD.
• Increased Operating Loss: Net loss widened significantly to $123.1 million YTD 2025 from $23.5 million YTD 2024. This was driven by higher R&D expenses and the lack of the large upfront license revenue recognized in the prior year.
• R&D Expense Growth: Research and development expenses increased by $22.8 million YTD, primarily due to accelerated costs for the seralutinib Phase 3 PROSERA study and PH-ILD development.
• IPR&D Expense: The Company recorded $7.5 million in In-Process Research and Development (IPR&D) expenses in Q3 2025 related to the acquisition of a merger option for Prana Bio, Inc., a non-recurring item not present in the prior year.
• Liquidity Position: Cash and cash equivalents decreased from $46.1 million at year-end 2024 to $8.9 million at September 30, 2025, though total liquid assets (including marketable securities) remain at $180.2 million.

Outlook, Risks, and Management Commentary

• Clinical Milestones: Enrollment for the Phase 3 PROSERA study in PAH was completed in June 2025, with topline data expected in February 2026. The Phase 3 SERANATA study for PH-ILD activated its first site in October 2025.
• Liquidity Outlook: Management believes current cash, cash equivalents, and marketable securities are sufficient to fund operations for at least the next 12 months. However, the Company expects to continue incurring significant losses and may need to raise additional capital through equity or debt offerings.
• Chiesi Collaboration: The Company continues to recognize revenue over time based on R&D services performed and cost-sharing reimbursements. Future revenue is contingent on achieving regulatory and commercial milestones, which are currently constrained and not included in the transaction price.
• Risks: Key risks include the failure of clinical trials, inability to raise additional capital, and dependence on Chiesi for 100% of revenue. The Company also faces potential future milestone payments to Pulmokine upon regulatory approvals.

Investor Verification Checklist

• Verify the timeline and budget for the Phase 3 PROSERA and SERANATA studies, as these drive future cash burn.
• Confirm the specific terms of the Prana Bio merger option and the potential dilution from the additional 1.5 million shares issuable upon exercise.
• Monitor the Company's cash burn rate relative to the $180.2 million in liquid assets to assess the runway beyond the 12-month management estimate.
• Review the status of the 5.00% Convertible Senior Notes due 2027, including conversion triggers and redemption rights.
• Assess the probability of achieving the regulatory milestones required to unlock the remaining $146 million in potential Chiesi milestone payments.