Annual report [Section 13 and 15(d), not S-K Item 405]

INCOME TAXES (Tables)

v3.25.4
INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
Schedule of (Benefit From) Provision for Income Taxes
The components of the (benefit from) provision for income taxes included in the statements of operations were as follows (in thousands):
Year Ended December 31,
2025 2024 2023
Current:
Federal $ —  $ —  $ — 
State and local 655  281  — 
Foreign —  600  — 
Total current taxes 655  881  — 
Deferred:
Federal (233,679) —  — 
State and local (12,173) —  — 
Foreign —  —  — 
Total deferred taxes (245,852) —  — 
(Benefit from) provision for income taxes $ (245,197) $ 881  $ — 
Schedule of (Benefit From) Provision for Income Taxes and Effective Tax Rate
A reconciliation of the (benefit from) provision for income taxes to the amount computed by applying the US federal statutory income tax rate to income (loss) before income taxes for the periods presented is as follows (in thousands, except percentages):
Year Ended December 31,
2025 2024 2023
Amount % Amount % Amount %
Federal statutory tax rate $ 25,593  21.0 % $ 3,907  21.0  % $ (5,261) (21.0) %
State and local, net of federal income tax effect*
(11,518) (9.5 %) 281  1.5 % 15  0.1 %
Foreign tax effect (Indian withholding tax) —  — % 600  3.2 % —  — %
Change in valuation allowance (265,784) (218.1 %) (5,644) (30.3 %) (3,081) (12.3 %)
Research and development tax credits (744) (0.6 %) 540  2.9 % 6,583  26.3 %
Changes in unrecognized tax benefit (82) —  % 46  0.2  % 33  0.1 %
Nontaxable or non-deductible items:
Stock-based compensation 7,300  5.9 % 1,189  6.4 % 1,323  5.3 %
Other 38  —  % (38) (0.1) % 388  1.5 %
Total (benefit from) provision for income taxes/ Effective tax rate $ (245,197) (201.3 %) $ 881  4.8 % $ —  — %
*State taxes in California made up the majority (greater than 50 percent) of the tax effect in this category.
Schedule of Income Taxes Paid (Net of Refunds Received)
The amount of income taxes paid (net of refunds received) were as follows (in thousands):
Year Ended December 31,
2025 2024 2023
Federal $ —  $ —  $ — 
State and local
Alabama 129  233  15 
Kentucky 256  57  *
Tennessee * 28  14 
New York * * 48 
All states representing less than five percent of total 78  13  4 
Total state and local 463  331  81 
Foreign
India 600  —  — 
Total income taxes paid $ 1,063  $ 331  $ 81 
_______________________
*Denotes less than 5% of total income taxes paid in the respective periods.
Schedule of Components of Deferred Tax Assets Significant components of our deferred tax assets are as follows (in thousands):
As of December 31,
2025 2024
Deferred tax assets
Net operating loss carryforwards $ 216,008  $ 222,744 
Orphan drug and research and development credits 63,458  62,314 
Capitalized research and development expenses 5,165  19,604 
Deferred revenue 334  10,181 
Deferred compensation 4,616  11,701 
Other, net 3,296  2,751 
Deferred tax liabilities
Others (327) (61)
Total net deferred tax assets 292,550  329,234 
Less: valuation allowance (46,698) (329,234)
Deferred tax assets, net of allowance $ 245,852  $ — 
Schedule of Unrecognized Tax Benefits
The following table summarizes the activity related to our gross unrecognized tax benefits (in thousands):
Year Ended December 31,
2025 2024 2023
Balance at the beginning of the year $ 8,780  $ 8,672  $ 9,426 
Decrease related to prior year tax positions —  —  (843)
Increase related to current year tax positions 270  108  89 
Balance at the end of the year $ 9,050  $ 8,780  $ 8,672