Financial Analysis

Note 8. Commitments and Contingencies Legal Matters The Companys industry is characterized by frequent claims and litigation, including claims regarding intellectual property. As a result, the Company may be subject to various legal proceedings from time to time. The results of any future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. Management is not aware of any pending or threatened litigation. Indemnification As permitted under Delaware law and in accordance with the Companys bylaws, the Company indemnifies its officers and directors for certain events or occurrences while the officer or director is or was serving in such capacity. The Company is also party to indemnification agreements with its directors. The Company believes the fair value of the indemnification rights and agreements is minimal. Accordingly, the Company has not recorded any liabilities for these indemnification rights and agreements as of December 31, 2025 and 2024. Contingencies From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of its business activities. The Company accrues a liability for such matters when it is probable that future expenditures will be made, and such expenditures can be reasonably estimated. …

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Note 16. Employee Benefit Plan The Company sponsors a 401(k) defined contribution plan for its US employees. This plan provides for pre-tax and post-tax contributions for all US employees. Employee contributions are voluntary. Employees may contribute up to 100 % of their annual compensation to this plan, as limited by an annual maximum amount as determined by the Internal Revenue Service. The Company may match employee contributions, and may make profit sharing contributions, in amounts to be determined at the Companys sole discretion . The amount of contributions that the Company made to the 401(k) Plan during the years ended December 31, 2025 and 2024 was $ 45 thousand and $ 0.1 million, respectively. The Company has defined benefit plans, regulated by the Italian laws in which the Companys non-US employees participate. The benefits due to employees under the defined benefit plans are calculated based on the employee compensation and the duration of the employment relationship and are paid to the employee upon termination of the employment relationship or retirement. The costs of the defined benefit plans reported in the Companys consolidated statements of operations and comprehensive loss is determined by an actuarial calculation performed on an annual basis. The actuarial valuation is performed using the Projected Unit Credit Method based on the employees expected date of separation or retirement. …

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Note 7. Debt In connection with the acquisition of EryDel on October 20, 2023 , the Company became a guarantor in respect of the EIB Loan. The EIB Loan was amended and restated as of the acquisition date. The EIB Loan provides for maximum borrowings of 30.0 million euro through four tranches; tranche A, 3.0 million euro; tranche B, 7.0 million euro; tranche C, 10.0 mi llion euro; and tranche D, 10.0 million euro. Each tranche is subject to conditions precedent related to the Companys business and capitalization . As of December 31, 2025 , only tranches A and B have been drawn. All amounts due under tranche A and B are payable on their maturity date of August 2026. Tranche C and D are payable in equal installments of principal together with all amounts outstanding under the tranches on the repayment date. The first repayment date of tranche C shall fall not earlier than twelve months from the disbursement date of such tranche. The last repayment date of tranche C and tranche D shall fall not later than 5 years from the disbursement date of tranche C and tranche D, respectively. The EIB Loan bears interest at fixed rates for each tranche and is payable on the maturity date for each Tranche (with the exception of 2 % cash interest which shall accrue and be payable quarterly during fiscal year 2025 pursuant to the terms of the Amendment, which shall correspondingly reduce the deferred interest rate accruing during such period). The fixed rates range from 7.0 % to 9.0 % per annum. …

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"Note 11. Stock-Based Compensation The Company operates three stock-based compensation plans as of December 31, 2025. 2019 Equity Incentive Plan (Quince) 2019 Equity Incentive Plan (Novosteo) 2022 Inducement Plan (Quince) 2019 Equity Incentive Plan (Quince) On December 4, 2014, the Companys stockholders approved the 2014 Stock Plan (2014 Plan), and on April 25, 2019 amended, restated and re-named the 2014 Plan as the 2019 Equity Incentive Plan (the Quince 2019 Plan), which became effective as of May 7, 2019, the day prior to the effectiveness of the registration statement filed in connection with the IPO. The remaining shares available for issuance under the 2014 Plan were added to the shares reserved for issuance under the Quince 2019 Plan. The Quince 2019 Plan provides for the grant of stock options (including incentive stock options and non-qualified stock options), stock appreciation rights, restricted stock, RSUs, performance units, and performance shares to the Companys employees, directors, and consultants. As of December 31, 2025 , the maximum aggregate number of shares that may be issued under the Quince 2019 Plan is 13,515,484 shares of the Companys common stock. In addition, the number of shares available for issuance under the Quince 2019 Plan will be annually increased on the first day of each fiscal years beginning with fiscal 2020, by an amount equal to the least of (i) 2,146,354 shares of common stock; (ii) 4 % of the outstanding shares of its common stock as …

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Note 3. Fair Value Measurements The fair value of the Company's financial instruments reflects the amounts that the Company estimates that it would receive in connection with the sale of an asset or pay in connection with the transfer of a liability in an orderly transaction between market participants at the measurement date (exit price). The Company discloses and recognizes the fair value of the assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). The guidance establishes three levels of the fair value hierarchy as follows: Level 1 - Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 - Inputs other than quoted prices that are observable for the assets or liability either directly or indirectly, including inputs in markets that are not considered to be active. Level 3 - Inputs that are unobservable. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the …

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Note 12. Income taxes The components of the Company's loss before income taxes were as follows (in thousands): Year ended December 31, 2025 2024 United States $ ( 56,470 ) $ ( 22,397 ) International ( 24,295 ) ( 34,344 ) Total $ ( 80,765 ) $ ( 56,741 ) The components of the Company's expense (benefit) for income taxes were as follows (in thousands): Year ended December 31, 2025 2024 Current expense (benefit): Federal $ 241 $ 44 State ( 9 ) Foreign 8,571 88 Total current expense (benefit): 8,803 132 Deferred expense (benefit): Federal State Foreign ( 5,589 ) ( 45 ) Total deferred expense (benefit): ( 5,589 ) ( 45 ) Total income tax expense (benefit) $ 3,214 $ 87 A reconciliation of the Companys effective tax rate to the statutory U.S. federal rate is as follows (in thousands, except percentages): Year ended December 31, 2025 Amount Percentage U.S. federal taxes at statutory rate $ ( 16,961 ) 21.00 % State tax, net of federal income tax benefit 1 Effect of cross-border tax laws Global intangible low-taxed income (GILTI) 6,544 ( 8.10 ) R&D tax credit ( 311 ) 0.38 Change in valuation allowance ( 403 ) 0.50 Nondeductible items Stock based compensation 681 ( 0.84 ) Change in fair value - warrants and contingent consideration 6,113 ( 7.57 ) Other 194 ( 0.24 ) Worldwide changes in unrecognized tax benefits 17,846 ( 22.10 ) Other Acquisition-related deferred tax adjustment 216 ( 0.27 ) Foreign tax effects Italy Rate differential ( 2,010 ) 2.49 Change in valuation allowance ( 7,315 …

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Note 6. Leases In January 2024, the Medolla Lease Agreement for the office space was renegotiated. The new Medolla Lease Agreement includes an additional space and commenced on February 1, 2024, and will end on January 31, 2030, substituting the Medolla Lease Agreement commenced in June 2018. The Company recognizes lease expense on a straight-line basis over the term of its operating lease. During the year ended December 31, 2025 and 2024, the Company recorded lease expense of $ 0.2 million and $ 0.1 million, respectively. Supplemental balance sheet information related to leases as follows (in thousands except lease terms and discount rates): December 31, 2025 December 31, 2024 Assets: Operating lease right of use asset, net $ 453 $ 498 Liabilities: Short-term operating lease liability 115 96 Long-term operating lease liability 330 394 Total lease liabilities $ 445 $ 490 Other information: Weighted average remaining lease term 3.7 years 4.6 years Weighted average discount rate 9.12 % 9.11 % Future minimum lease payments under lease agreements as of December 31, 2025, were as follows (in thousands): Fiscal Year 2026 $ 149 2027 142 2028 128 2029 and thereafter 101 Total lease payments 520 Less: imputed interest ( 75 ) Total remaining lease liability $ 445

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Recent Accounting Pronouncements Adopted ASU 2023-09, Improvements to Income Tax Disclosures (ASC 740). In December 2024, the FASB issued this ASU to establish new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. Under this ASU, entities must consistently categorize and provide greater disaggregation of information in the rate reconciliation and income taxes paid. They must also further disaggregate income taxes paid. The Company adopted this new standard for the year ended December 31, 2025. These amendments have been applied on a prospective basis in the financial statements. See Note 12 for the inclusion of new disclosures required. Recent Accounting Pronouncements Not Yet Adopted The following are new accounting pronouncements that the Company is evaluating for future impacts on its consolidated financial statements: ASU 2024-03, Disaggregation of Income Statement Expenses (DISE) . In November 2024, the FASB issued a new accounting standard to improve the disclosures about an entitys expenses and address requests from investors for more detailed information about the types of expenses included in commonly presented expense captions. The new standard is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with retrospective application permitted. The Company is evaluating the disclosure requirements related to the new standard. ASU …

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Note 15. Segment Information The Company manages its business activities on a consolidated basis and operates as one operating and reportable segment, which is the business of developing and commercializing the Company's proprietary AIDE technology platform. The key factors used to identify the reportable segments are the organization of its business and alignment of the Company's internal operations and the nature of our AIDE technology. Operating segments are defined as components of an enterprise for which discrete financial information is available and is evaluated regularly by the CODM, in deciding how to allocate resources and assess performance. The Companys Chief Executive Officer , who is the CODM, reviews financial information on a consolidated basis for purposes of allocating and evaluating financial performance. The CODM evaluates the Companys performance and resource allocation by analyzing consolidated net loss, as reported on the consolidated statement of operations. This assessment involves comparing net loss across prior periods, the Company's forecast, and total expenditures related to eDSP product development and the ongoing Phase 3 NEAT clinical trial. The measure of segment assets reviewed by the CODM is the consolidated total assets, as reported on the consolidated balance sheet. The following table presents the measure of segment assets regularly provided to the CODM (in thousands): December 31, 2025 2024 Cash, cash equivalents and short-term investment …

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Note 2. Summary of Significant Accounting Policies Basis of Consolidation The accompanying consolidated financial statements include the accounts of Quince Therapeutics, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated upon consolidation. Basis of Presentation The accompanying consolidated financial statements and the notes thereto have been prepared in accordance with GAAP pursuant to the instructions of the SEC on Form 10-K through the rules and interpretive releases of the SEC under federal securities law. Certain prior year amounts have been reclassified for consistency with the current period presentation with an immaterial impact on the consolidated financial statements. Risks and Uncertainties Based on the results of the NEAT clinical trial, the Company will be unable to continue development of eDSP. The Company has no other current product candidates and does not have sufficient resources to pursue further research and development activities. While the Company engaged LifeSci Capital as its exclusive financial advisor to assist in restructuring activities and evaluate strategic alternatives aimed at maximizing shareholder value, the Company does not currently have any agreements or commitments to effect any such transactions and may not be able to execute such transactions on terms favorable to the Company or its stockholders, or at all. The Companys future results of operations involve a number of risks and uncer …

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Note 9. Common Stock Common Stock On June 4, 2025, the Companys shareholders approved an amendment to the Companys certificate of incorporation to increase the total number of authorized shares of Common Stock from 100,000,000 to 250,000,000 . The Company had reserved shares of common stock for future issuance as follows: December 31, 2025 2024 Options issued and outstanding under the Quince 2019 Stock Plan 10,299,981 7,408,005 Shares available for issuance under Quince 2019 Stock Plan 1,071,074 2,428,575 Shares available for issuance under the Employee Stock Purchase Plan 2,364,278 1,924,262 Options issued and outstanding under the Novosteo 2019 Plan 161,568 163,839 Shares available for issuance under Novosteo 2019 Plan 246,797 246,797 Options issued and outstanding under the 2022 Inducement Plan 2,333,306 2,333,306 Shares available for issuance under 2022 Inducement Plan 1,666,694 1,666,694 Total 18,143,698 16,171,478 The Company is authorized to issue 250,000,000 shares of common stock with a par value of $ 0.001 per share. Each share of common stock is entitled to one vote. The holders of common stock are also entitled to receive dividends whenever funds are legally available and when and if declared by the board of directors, subject to the prior rights of holders of any preferred stock that may be outstanding at the time. The Company has never declared any dividends on common stock. As of December 31, 2025 and 2024, the Company had 55,725,291 and 44,001,643 shares of co …

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Note 17. Subsequent Events In January 2026, the Company issued 2,000,000 shares of common stock related to pre-funded warrant holders exercising their warrants at an exercise price of $ 0.001 . The Company reclassified the pre-funded warrant liability to equity. As a result of the clinical readout of the Phase III NEAT study in January 2026 (see Note 1), the Company expects substantially all of the IPR&D to be impaired. Additionally, the criteria for the contingent consideration payments are not expected to be met, resulting in the related liability being reduced to zero. Following December 31, 2025, and through the issuance of these financial statements, the Company raised net proceeds of approximately $ 20.4 million by issuing 105,285,000 shares of common stock under the ATM program, with approximately $ 47.5 million remaining subject to available shares for issuance. In February 2026, the Company engaged in restructuring activities and evaluation of strategic alternatives aimed at maximizing shareholder value. As such, the Company incurred severance costs of $ 1.4 million related to personnel separation. In March 2026, the EIB agreed to a full settlement of all obligations associated with the loan with a single payment of 4.8 million euros ($ 5.5 million) which was paid on March 30, 2026. On April 2, 2026, the Companys board of directors determined to effect a reverse stock split of 1-for-10 for the Companys outstanding shares of common stock and approved an amendment …

SubsequentEventsTextBlock · excerpt; the full note is in the filing