Business Context and Reporting Period
Company: Whitehawk Therapeutics, Inc. (formerly Aadi Bioscience, Inc.)
Filing Type: Form 10-Q
Period: Quarter ended September 30, 2025
Business Overview: Whitehawk is a preclinical-stage oncology therapeutics company. In March 2025, the company completed the divestiture of its legacy commercial business, FYARRO (nab-sirolimus), to KAKEN Investments Inc. Following this transaction, the company's pipeline consists solely of three in-licensed preclinical antibody drug conjugates (ADCs) targeting MUC16, PTK7, and SEZ6, licensed from WuXi Biologics.
Key Financial Metrics
| Metric (in thousands) | Q3 2025 | Q3 2024 | 9 Months 2025 | 9 Months 2024 |
|---|---|---|---|---|
| Total Revenue | $0 | $7,212 | $7,145 | $18,744 |
| Net (Loss) Income | $(17,746) | $(12,546) | $2,655 | $(45,418) |
| Operating Expenses | $19,546 | $20,625 | $96,658 | $67,253 |
| Research & Development | $14,345 | $9,997 | $71,942 | $36,683 |
| SG&A | $5,201 | $7,186 | $23,956 | $25,698 |
| Cash & Short-Term Investments | $162,597 | $47,237 | $162,597 | $47,237 |
| Accumulated Deficit | $(329,999) | $(314,381) | $(329,999) | $(314,381) |
Note: Q3 2025 revenue is $0 as the FYARRO business was divested in March 2025. The 9-month 2025 net income is driven by a one-time gain on the sale of the FYARRO business.
Material Changes vs. Prior Period
- Divestiture of FYARRO: The company sold 100% of its FYARRO business to KAKEN on March 25, 2025, for $102.4 million. This resulted in a net gain on sale of $87.3 million (adjusted for a $0.2 million post-closing adjustment), which turned a significant operating loss into net income for the nine months ended September 30, 2025.
- Revenue Cessation: Product sales dropped to $0 in Q3 2025 compared to $7.2 million in Q3 2024, as the company no longer commercializes FYARRO.
- Increased R&D Spend: R&D expenses increased to $14.3 million in Q3 2025 from $10.0 million in Q3 2024. For the nine months, R&D rose to $71.9 million from $36.7 million, primarily due to a $38.0 million upfront license fee paid to WuXi Biologics for the new ADC portfolio.
- Capital Raise: The company completed a PIPE financing in March 2025, raising approximately $94.4 million in net proceeds, significantly boosting cash reserves.
- Balance Sheet Transformation: Total assets increased from $70.3 million (Dec 31, 2024) to $167.0 million (Sep 30, 2025), driven by cash and short-term investments. Inventory and accounts receivable related to the divested business were removed.
Guidance, Outlook, and Risks
- Outlook: Management believes current cash, cash equivalents, and short-term investments ($162.6 million) are sufficient to fund operations into 2028. The company expects to continue incurring net losses as it advances the preclinical ADC Therapies.
- Pipeline Strategy: The company plans to submit Investigational New Drug (IND) applications for its three ADC candidates (HWK-007, HWK-016, HWK-206) by mid-2026.
- Key Risks:
- Preclinical Stage: The company has no approved products and relies entirely on the success of its new preclinical pipeline.
- Third-Party Reliance: Manufacturing and development rely heavily on WuXi Biologics and Hangzhou DAC, both based in China, exposing the company to geopolitical and trade risks (e.g., BIOSECURE Act).
- Liquidity: While currently funded, the company will require additional capital to complete development and commercialization.
- Regulatory Uncertainty: Risks associated with FDA approval processes and potential changes in regulatory leadership.
Investor Verification Checklist
- Divestiture Finality: Confirm the $102.4 million cash proceeds from the FYARRO sale have been fully received and the transition services agreement with KAKEN is concluded.
- ADC License Terms: Verify the specific milestones and royalty obligations under the WuXi Biologics license agreement, including the $265 million in potential development milestones.
- Cash Burn Rate: Monitor the quarterly cash burn rate post-divestiture to validate the "into 2028" runway estimate.
- China Exposure: Assess the impact of U.S.-China trade tensions and the potential BIOSECURE Act on the supply chain for the ADC linker-payload technology.
- Share Count: Note the significant increase in outstanding shares (from ~24.7 million to ~47.1 million) due to the 2024/2025 PIPE financing and pre-funded warrants.