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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________________ to _____________________

Commission File Number: 001-39062

Korro Bio, Inc.

(Exact name of registrant as specified in its charter)


Delaware	47-2324450
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
60 First Street, 2nd Floor, Suite 250 Cambridge, MA	02141
(Address of principal executive offices)	(Zip Code)

(617) 468-1999

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading
Symbol(s)

     Name of each exchange on which registered

     Common Stock, par value $0.001 per share

     KRRO

     The Nasdaq Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 8, 2025, the registrant had 9,390,903 shares of common stock, $0.001 par value per share, outstanding.

Table of Contents


		Page

PART I.	FINANCIAL INFORMATION	1

Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations and Comprehensive Loss	2
	Condensed Consolidated Statements of Stockholders’ Equity	3
	Condensed Consolidated Statements of Cash Flows	4
	Notes to Unaudited Condensed Consolidated Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	24
Item 4.	Controls and Procedures	24

PART II.	OTHER INFORMATION	25

Item 1.	Legal Proceedings	25
Item 1A.	Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	72
Item 3.	Defaults Upon Senior Securities	72
Item 4.	Mine Safety Disclosures	72
Item 5.	Other Information	72
Item 6.	Exhibits	73
Signatures		74

Unless the context otherwise indicates, references in this Quarterly Report on 10-Q to the “Company,” the "combined company," “we,” “our” and “us” refer, collectively, to Korro Bio, Inc., a Delaware corporation, and its consolidated subsidiaries (including Legacy Korro) after completion of our November 2023 business combination. The term “Legacy Korro” refers to privately held Korro Bio Ops, Inc. (formerly known as Korro Bio, Inc.), which we acquired in the November 2023 business combination.

We use various trademarks and trade names in our business, including without limitation our corporate name and logo. All other trademarks or trade names referred to in this Quarterly Report on Form 10-Q are the property of their respective owners. Solely for convenience, the trademarks and trade names in this Quarterly Report on Form 10-Q may be referred to without the ® and ™ symbols, but such references should not be construed as any indicator that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, or this Quarterly Report, includes statements that are not historical facts and are considered forward-looking within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this Quarterly Report may include, for example, statements about:

•

the timing, progress, results, and cost of our Phase 1/2a REWRITE clinical trial of KRRO-110, including our ability to complete the Phase 1/2a clinical trial and KRRO-110’s best-in-class potential for the treatment of Alpha-1 Antitrypsin Deficiency, or AATD;

•

the initiation, timing, progress, results, cost of and other statements regarding our research and development programs and our current and future preclinical studies and clinical trials, including statements regarding the timing of announcement of our rare metabolic disorder program, initiation and completion of studies or trials and related preparatory work, and the period during which the results of the trials will become available;

•

our cash runway and ability to reach meaningful clinical data readouts and data inflection points;

•

the effects of our organizational streamlining and workforce reduction;

•

the therapeutic and commercial potential of our product candidates;

•

our research and development and other expenses;

•

our 3-2-1 strategy and other strategic objectives;

•

our collaboration arrangement with Novo Nordisk A/S, or Novo Nordisk, and any future collaboration or licensing arrangements;

•

our ability to comply with, and the impact of, regulatory requirements, obligations and restrictions on our business and operations;

•

our ability to protect our intellectual property and operate our business without infringing upon the intellectual property rights of others, including our ability to obtain and maintain rights to the technologies required to develop and commercialize our product candidates;

•

competitive developments, including the impact on our competitive position of competing products and product candidates and our ability to meet such competition; and

•

our ability to manage the growth of our business.

These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements, including those set forth under the heading “Risk Factors” in Part II, Item 1A of this Quarterly Report. Given these risks and uncertainties, you should not place undue reliance on these forward-looking statements. Should one or more of the risks or uncertainties described in this Quarterly Report, or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this Quarterly Report. We qualify all of our forward-looking statements by these cautionary statements.

SUMMARY OF RISK FACTORS

Our business involves significant risks. Below is a summary of the material risks that our business faces, which makes an investment in our securities speculative and risky. This summary does not address all these risks. These risks are more fully described below under the heading “Risk Factors” in Part II, Item 1A of this Quarterly Report. Before making investment decisions regarding our securities, you should carefully consider these risks. The occurrence of any of the events or developments described below could have a material adverse effect on our business, results of operations, financial condition, prospects and stock price. In such event, the market price of our securities could decline, and you could lose all or part of your investment. Further, there are additional risks not described below that are either not currently known to us or that we currently deem immaterial, and these additional risks could also materially impair our business, operations or market price of our securities.

•

We have incurred significant losses since inception and expect to incur losses for the foreseeable future and may never achieve or maintain profitability.

•

We have never generated revenue from product sales and may never become profitable.

•

We will need substantial additional funding. If we are unable to raise capital when needed, we will be forced to delay, reduce, eliminate or prioritize among our research and development programs or future commercialization efforts.

•

We have dosed very few participants in our Phase 1/2a REWRITE clinical trial of KRRO-110 for AATD, and have not completed any clinical trials nor reported any clinical trial results for any of our proposed delivery methods or RNA editing approaches. Any favorable results we may have may not be predictive of results that may be observed in later preclinical studies or clinical trials.

•

If preclinical studies or clinical trials of any product candidates we may identify and develop fail to demonstrate safety and efficacy to the satisfaction of regulatory authorities or do not otherwise produce positive results, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of such product candidates.

•

If we experience delays or difficulties in the enrollment of patients in clinical trials, or other delays in our clinical trials, our receipt of necessary regulatory approvals could be delayed or prevented.

•

We may not realize the anticipated benefits of our organizational streamlining and workforce reduction.

•

The gene editing field and RNA editing in particular is relatively new and is evolving rapidly. We are very early in our research and development efforts and may not be successful in identifying and developing product candidates. It will be many years before we or our collaborators commercialize a product candidate or generate any revenues, if ever. Additionally, other gene editing technologies may be discovered that provide significant advantages over RNA editing, which could materially harm our business.

•

RNA editing is a novel technology with limited clinical validation for human therapeutic use. The approaches we take to discover and develop novel therapeutics are unproven and may never lead to marketable products.

•

We are very early in our development efforts, and our preclinical studies and clinical trials may not be successful. If we are unable to commercialize our product candidates or experience significant delays in doing so, our business will be materially harmed.

•

Any product candidates we develop may fail in preclinical or clinical development or be delayed to a point where they do not become commercially viable.

•

Because we are developing oligonucleotides, which are considered a relatively new class of drugs, there is increased risk that the outcome of our clinical trials will not be sufficient to obtain regulatory approval.

•

If we are not able to obtain or protect intellectual property rights related to any of our product candidates, development and commercialization of our product candidates may be adversely affected.

•

We may not be successful in finding strategic collaborators for continuing development of certain of our product candidates or successfully commercializing or competing in the market for certain indications; and we may not see any benefit from our collaboration agreement with Novo Nordisk.

•

The price of our common stock is volatile and fluctuates substantially, which could result in substantial losses for our stockholders.

•

Our certificate of incorporation and bylaws and provisions under Delaware law could make an acquisition of us more difficult and may prevent attempts by our stockholders to replace or remove our management.

iii

•

Our executive officers, directors and principal stockholders have the ability to control or significantly influence all matters submitted to our stockholders for approval.

•

Unfavorable global economic conditions could adversely affect our business, financial condition, results of operations or cash flow.

•

Our business may be impacted by macroeconomic conditions, including fears concerning inflation, rising interest rates and volatile market conditions (including as a result of announced tariffs or other policy changes by the current U.S. administration), and other uncertainties beyond our control.

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

Korro Bio, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

(amounts in thousands, except share and par value amounts)


	June 30, 2025			December 31, 2024
Assets:
Current assets:
Cash and cash equivalents	$	33,612		$	55,643
Short-term marketable securities		62,750			70,452
Accounts receivable		1,089			1,696
Prepaid expenses and other current assets		5,183			3,741
Total current assets		102,634			131,532
Property and equipment, net		25,395			27,710
Operating lease right-of-use assets		23,510			23,836
Restricted cash, net of current portion		2,409			3,406
Long-term marketable securities		23,264			36,959
Other non-current assets		3,213			2,797
Total assets	$	180,425		$	226,240
Liabilities and stockholders' equity
Current liabilities:
Accounts payable	$	5,163		$	3,992
Accrued expenses and other current liabilities		5,659			6,171
Operating lease liabilities, current portion		2,425			1,284
Deferred revenue, current portion		3,926			3,513
Total current liabilities		17,173			14,960
Operating lease liabilities, net of current portion		42,207			43,481
Deferred revenue, net of current portion		4,502			5,912
Other non-current liabilities		1,440			1,472
Total liabilities		65,322			65,825
Commitments and contingencies (Note 12)
Stockholders’ equity
Preferred stock, $0.001 par value; 10,000,000 shares authorized at June 30, 2025 and December 31, 2024; no shares issued and outstanding at June 30, 2025 and December 31, 2024		—			—
Common stock, $0.001 par value; 200,000,000 shares authorized at June 30, 2025 and December 31, 2024; 9,390,842 shares and 9,377,259 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively		9			9
Additional paid-in capital		430,660			426,724
Accumulated other comprehensive income		177			268
Accumulated deficit		(315,743	)		(266,586	)
Total stockholders’ equity		115,103			160,415
Total liabilities and stockholders' equity	$	180,425		$	226,240

The accompanying notes are an integral part of these condensed consolidated financial statements.

Korro Bio, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(unaudited)

(amounts in thousands, except share and per share amounts)


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Revenue:
Collaboration revenue	$	1,460		$	—		$	4,010		$	—
Operating expenses:
Research and development		21,031			17,138			40,770			30,710
General and administrative		7,631			6,987			15,462			14,868
Total operating expenses		28,662			24,125			56,232			45,578
Loss from operations		(27,202	)		(24,125	)		(52,222	)		(45,578	)
Other income:
Other income, net		1,433			2,329			3,066			4,242
Total other income, net		1,433			2,329			3,066			4,242
Loss before provision for income taxes		(25,769	)		(21,796	)		(49,156	)		(41,336	)
Provision for income taxes		(1	)		(30	)		(1	)		(47	)
Net loss	$	(25,770	)	$	(21,826	)	$	(49,157	)	$	(41,383	)
Other comprehensive income:
Unrealized (loss) gain on available-for-sale marketable securities		(74	)		21			(77	)		21
Foreign currency translation adjustments, net		(13	)		—			(14	)		—
Comprehensive loss	$	(25,857	)	$	(21,805	)	$	(49,248	)	$	(41,362	)
Net loss per share, basic and diluted	$	(2.74	)	$	(2.43	)	$	(5.24	)	$	(4.87	)
Weighted-average shares used in computing net loss per share, basic and diluted		9,390,542			8,986,545			9,386,597			8,503,086

The accompanying notes are an integral part of these condensed consolidated financial statements.

Korro Bio, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(unaudited)

(amounts in thousands, except share amounts)


	Common Stock				Additional Paid-		Accumulated Other Comprehensive			Accumulated			Total Stockholders'
	Shares		Amount		In Capital		Income (Loss)			Deficit			Equity
Balance at December 31, 2024		9,377,259	$	9	$	426,724	$	268		$	(266,586	)	$	160,415
Exercises of stock options		11,643		—		172		—			—			172
Stock-based compensation expense		—		—		1,761		—			—			1,761
Other comprehensive loss, net of tax of $0		—		—		—		(4	)		—			(4	)
Net loss		—		—		—		—			(23,387	)		(23,387	)
Balance at March 31, 2025		9,388,902	$	9	$	428,657	$	264		$	(289,973	)	$	138,957
Exercises of stock options		1,940		—		5		—			—			5
Stock-based compensation expense		—		—		1,998		—			—			1,998
Other comprehensive loss, net of tax of $0		—		—		—		(87	)		—			(87	)
Net loss		—		—		—		—			(25,770	)		(25,770	)
Balance at June 30, 2025		9,390,842	$	9	$	430,660	$	177		$	(315,743	)	$	115,103

Balance at December 31, 2023		8,016,516	$	8	$	352,908	$	—		$	(183,005	)	$	169,911
Exercises of stock options		5,947		—		139		—			—			139
Stock-based compensation expense		—		—		865		—			—			865
Net loss		—		—		—		—			(19,557	)		(19,557	)
Balance at March 31, 2024		8,022,463	$	8	$	353,912	$	—		$	(202,562	)	$	151,358
Exercises of stock options		8,191				172		—			—			172
Stock-based compensation expense		—		—		967		—			—			967
Issuance of common stock for cash in PIPE financing		1,249,283		1		67,384		—			—			67,385
Unrealized gain on investments, net of tax of $0		—		—		—		21			—			21
Net loss		—		—		—		—			(21,826	)		(21,826	)
Balance at June 30, 2024		9,279,937	$	9	$	422,435	$	21		$	(224,388	)	$	198,077

The accompanying notes are an integral part of these condensed consolidated financial statements.

Korro Bio, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

(amounts in thousands)


	Six Months Ended June 30,
	2025			2024
Operating Activities:
Net loss	$	(49,157	)	$	(41,383	)
Adjustments to reconcile net loss to net cash used in operating activities:
Non-cash lease expense		326			2,313
Stock-based compensation expense		3,759			1,832
Depreciation expense		2,452			1,447
Net amortization of premiums and discounts on marketable securities		(420	)		(171	)
Loss on disposal of property and equipment		81			—
Changes in operating assets and liabilities:
Accounts receivable		607			—
Prepaid expenses and other current assets		(445	)		(1,392	)
Accounts payable		1,194			(507	)
Accrued expenses and other current liabilities		(508	)		(4,049	)
Deferred revenue		(997	)		—
Operating lease liabilities		(133	)		5,254
Other non-current assets		(439	)		172
Net cash used in operating activities		(43,680	)		(36,484	)
Investing Activities:
Purchases of marketable securities		(11,161	)		(96,432	)
Proceeds from maturities of marketable securities		32,901			—
Purchases of property and equipment		(259	)		(11,572	)
Net cash provided by (used in) investing activities		21,481			(108,004	)
Financing Activities:
Proceeds from PIPE financing, net of issuance costs		—			67,384
Proceeds from exercises of stock options		177			311
Net cash provided by financing activities		177			67,695
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(9	)		—
Net decrease in cash, cash equivalents and restricted cash		(22,031	)		(76,793	)
Cash, cash equivalents and restricted cash, beginning of period		59,049			173,119
Cash, cash equivalents and restricted cash, end of period	$	37,018		$	96,326
Non-cash investing and financing activities:
Purchases of property and equipment in accounts payable and accrued expenses	$	7		$	914
Financing costs in accounts payable and accrued expenses	$	—		$	48
Supplemental cash flow information:
Cash paid for income taxes	$	1		$	47
Cash paid for operating lease liabilities	$	2,761		$	1,624

The accompanying notes are an integral part of these condensed consolidated financial statements.

Korro Bio, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

1. The Company and Liquidity

Nature of Business

Korro Bio, Inc. (together with its subsidiaries, the “Company”) is a clinical-stage biopharmaceutical company with a mission to discover, develop and commercialize a new class of genetic medicines based on editing RNA, enabling the treatment of both rare and highly prevalent diseases. The Company was incorporated in November 2014 as a Delaware corporation and in November 2023 completed a reverse merger with its now wholly-owned subsidiary and changed its name from Frequency Therapeutics, Inc. (“Frequency”) to Korro Bio, Inc. The Company's principal offices are in Cambridge, Massachusetts.

Risks and Uncertainties

The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, new technological innovations, protection of proprietary technology, dependence on key personnel, compliance with government regulations and the need to obtain additional financing. Product candidates currently under development will require significant additional research and development efforts, including extensive pre-clinical and clinical testing and regulatory approval, prior to commercialization. These efforts will require significant amounts of additional capital, adequate personnel infrastructure and extensive compliance-reporting capabilities. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will realize revenue from product sales.

Liquidity and Capital Resources

The Company’s consolidated financial statements have been prepared on the basis of the Company continuing as a going concern. The Company expects that its existing cash, cash equivalents and marketable securities as of June 30, 2025 of $119.6 million will enable the Company to fund its planned operating expense and capital expenditure requirements for at least 12 months from the date of issuance of these consolidated financial statements. The Company has incurred recurring losses and negative cash flows from operations since inception. As of June 30, 2025, the Company had an accumulated deficit of $315.7 million. The Company expects its operating losses and negative operating cash flows to continue into the foreseeable future. The future viability of the Company is dependent on its ability to generate cash from operating activities or to raise additional capital to finance its operations. There can be no assurance that the Company will ever earn revenues or achieve profitability, or if achieved, that the revenues or profitability will be sustained on a continuing basis. In addition, the Company’s preclinical and clinical development activities, manufacturing and commercialization of the Company’s product candidates, if approved, will require significant additional financing. However, if the Company is unable to obtain additional financing, the Company would be forced to delay, reduce or eliminate its research and development programs and/or relinquish valuable rights to its technology and product candidates. There is no assurance that the Company will be successful in obtaining sufficient financing on acceptable terms to continue funding its operations.

2. Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). These consolidated financial statements have been prepared on the going concern basis of accounting, which assumes continuity of operations, realization of assets and satisfaction of liabilities in the ordinary course of business.

The consolidated financial statements include the accounts of Korro Bio, Inc. and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

Unaudited Interim Condensed Consolidated Financial Information

The accompanying condensed consolidated financial statements as of June 30, 2025 and for the three and six months ended June 30, 2025 and 2024 are unaudited. The financial data and other information contained in the notes hereto as of June 30, 2025 and for the three and six months ended June 30, 2025 and 2024 are also unaudited. The condensed consolidated balance sheet data as of December 31, 2024 was derived from the Company's audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 (the "2024 Form 10-K").

The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements, and in the opinion of management, reflect all adjustments, which include any normal recurring adjustments necessary for the fair presentation of the Company's interim period results. These unaudited condensed consolidated

financial statements should be read in conjunction with the audited consolidated financial statements as of and for the year ended December 31, 2024, and the notes thereto, included in the 2024 Form 10-K.

The results for the three and six months ended June 30, 2025 are not necessarily indicative of results to be expected for the year ended December 31, 2025, or any other interim periods, or any future year or period.

Summary of Significant Accounting Policies

The significant accounting policies used in preparation of the condensed consolidated financial statements are described in the Company's audited consolidated financial statements as of the year end December 31, 2024, and the notes thereto, which are included in the 2024 Form 10-K. There have been no material changes to the significant accounting policies previously disclosed in the 2024 Form 10-K.

Use of Estimates

The preparation of the Company’s consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to stock-based compensation expense. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it has concluded to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results may differ materially from those estimates or assumptions.

Recent Accounting Pronouncements—Yet to be Adopted

The Company considers the applicability and impact of all Accounting Standards Updates (“ASU” or “ASUs”). Accounting standards that have been issued or proposed by the Financial Accounting Standards Board ("FASB") or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s consolidated financial statements upon adoption.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, which requires entities to disclose disaggregated information about their effective tax rate reconciliation and income taxes paid. The disclosure requirements will be applied on a prospective basis, with the option to apply them retrospectively. The standard is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the disclosure requirements related to this new standard.

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income- Expense Disaggregation Disclosures, which requires disclosure of additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. The standard is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the disclosure requirements related to this new standard.

3. Fair Value Measurements

The Company measures the fair value of money market funds based on quoted prices in active markets for identical securities. Marketable securities include U.S. treasury bills and U.S. government agency securities that are valued either based on recent trades of securities in inactive markets or based on quoted market prices of similar instruments and other significant inputs derived from or corroborated by observable market data.

The carrying amounts reflected in the consolidated balance sheets for cash, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their fair values, due to their short-term nature.

Assets and liabilities measured at fair value on a recurring basis as of June 30, 2025 were as follows (in thousands):


	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial assets
Cash equivalents:
Money market funds	$	32,444	$	32,444	$	—	$	—
Marketable securities
U.S. government agency securities		86,014		—		86,014		—
MS APA asset		1,421		—		—		1,421
Total financial assets	$	119,879	$	32,444	$	86,014	$	1,421

Financial liabilities
CVR liability	$	1,421	$	—	$	—	$	1,421
Total financial liabilities	$	1,421	$	—	$	—	$	1,421

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2024 were as follows (in thousands):


	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial assets
Cash equivalents:
Money market funds	$	55,155	$	55,155	$	—	$	—
Marketable securities
U.S. treasury bills		22,238		—		22,238		—
U.S. government agency securities		85,173		—		85,173		—
MS APA asset		1,472		—		—		1,472
Total financial assets	$	164,038	$	55,155	$	107,411	$	1,472

Financial liabilities
CVR liability	$	1,472	$	—	$	—	$	1,472
Total financial liabilities	$	1,472	$	—	$	—	$	1,472

The fair value of the contingent value right ("CVR") liability and the asset purchase agreement relating to Frequency’s multiple sclerosis program (the "MS APA") are based on significant unobservable inputs, which represent Level 3 measurements within the fair value hierarchy. In determining the fair value of the CVR liability and the MS APA asset, the Company used the income approach, primarily discounted cash flow models. The discounted cash flow models require the use of significant judgment, estimates and assumptions, including the probability of technical and regulatory success, and discount rates. For the six months ended June 30, 2025, the aggregate change in fair value of the CVR liability and MS APA asset was $0.1 million. For the year ended December 31, 2024, the aggregate change in fair value of the CVR liability and MS APA asset was $0.1 million.

There were no changes in valuation techniques, nor were there any transfers among the fair value hierarchy levels during the six months ended June 30, 2025 or during the year ended December 31, 2024.

4. Marketable Securities

Marketable securities were comprised as follows as of June 30, 2025 (in thousands):


	Maturities	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
U.S. government agency securities	Within 1 year	$	62,645	$	110	$	(5	)	$	62,750
U.S. government agency securities	Between 1 to 2 years		23,262		30		(28	)		23,264
Total		$	85,907	$	140	$	(33	)	$	86,014

Marketable securities were comprised as follows as of December 31, 2024 (in thousands):


	Maturities	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
U.S. treasury bills	Within 1 year	$	22,206	$	32	$	—		$	22,238
U.S. government agency securities	Within 1 year		48,085		140		(11	)		48,214
U.S. government agency securities	Between 1 to 2 years		36,936		110		(87	)		36,959
Total		$	107,227	$	282	$	(98	)	$	107,411

The amortized cost of available-for-sale securities is adjusted for amortization of premiums and accretion of discounts to maturity. There were no realized gains or losses on available-for-sale securities for the periods presented. None of the investments were in an unrealized loss position for greater than 12 months as of June 30, 2025. The unrealized losses on the Company's available-for-sale securities were caused by the impact of central bank and market interest rates on the investments held. The Company does not intend to sell the investments, and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases. After analyzing the securities in an unrealized loss position, the portion of these losses that relates to changes in credit quality is insignificant. The Company did not record an allowance for credit losses as of June 30, 2025. Furthermore, the Company does not believe that these securities expose the Company to undue market risk or counterparty credit risk.

5. Restricted Cash

As of June 30, 2025, the Company maintained current restricted cash of $1.0 million and non-current restricted cash of $2.4 million. The current restricted cash of $1.0 million is included under the caption “prepaid expenses and other current assets” in the Company's consolidated balance sheet. As of December 31, 2024, the Company maintained no current restricted cash and non-current restricted cash of $3.4 million. All restricted cash amounts are comprised solely of letters of credit required pursuant to the Company's facility leases.

The following table provides a reconciliation of cash, cash equivalents and restricted cash as of June 30, 2025 and December 31, 2024 that sums to the total of the same amounts shown in the consolidated statements of cash flows (in thousands):


	June 30, 2025		December 31, 2024
Cash and cash equivalents	$	33,612	$	55,643
Restricted cash		3,406		3,406
Cash, cash equivalents and restricted cash	$	37,018	$	59,049

6. Property and Equipment, Net

Property and equipment, net, as of June 30, 2025 and December 31, 2024 was comprised as follows (in thousands):


	Estimated Useful Life (in Years)	June 30, 2025			December 31, 2024
Laboratory equipment	5	$	11,492		$	11,331
Furniture and office equipment	4		1,086			1,075
Computer equipment	3		149			87
Leasehold improvements	Shorter of useful life or remaining lease term		22,447			22,438
Construction in progress			—			107
Total property and equipment, gross			35,174			35,038
Less: accumulated depreciation			(9,779	)		(7,328	)
Total property and equipment, net		$	25,395		$	27,710

Property, plant and equipment are recorded at historical cost, net of accumulated depreciation. Depreciation expense for the three months ended June 30, 2025 and 2024 was $1.2 million and $0.7 million, respectively. Depreciation expense for the six months ended June 30, 2025 and 2024 was $2.5 million and $1.4 million, respectively.

7. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities as of June 30, 2025 and December 31, 2024 were comprised as follows (in thousands):


	June 30, 2025		December 31, 2024
Employee compensation and benefits	$	2,330	$	3,775
External research and development services		2,038		1,793
Severance		777		—
Professional fees		384		326
Other operating expenses		130		277
Total accrued expenses and other current liabilities	$	5,659	$	6,171

8. Common Stock

As of June 30, 2025, the Company was authorized to issue 200,000,000 shares of common stock, $0.001 par value per share. Holders of common stock are entitled to one vote per share. In addition, holders of common stock are entitled to receive dividends, if and when declared by the Company’s Board of Directors. As of June 30, 2025, no dividends had been declared.

As of June 30, 2025 and December 31, 2024, the Company had reserved for future issuance the following number of shares of common stock:


	June 30, 2025		December 31, 2024
Exercises of outstanding stock options		1,782,231		1,248,288
Exercise of outstanding warrant		8,049		8,049
Future issuances under 2023 Stock Incentive Plan		541,265		619,923
Future issuances under 2023 ESPP Plan		262,440		168,667
Total reserved for future issuance		2,593,985		2,044,927

PIPE Offering

On April 17, 2024, the Company entered into a subscription agreement with certain new and existing accredited investors to issue and sell an aggregate of 1,249,283 shares of its common stock in a private placement ("PIPE") that resulted in gross proceeds of approximately $70.0 million, before deducting placement agent fees and offering expenses of approximately $2.6 million. The PIPE closed on April 22, 2024.

At-The-Market Equity Program

In December 2024, the Company filed a Shelf Registration Statement on Form S-3 (the "Shelf Registration Statement") with the Securities and Exchange Commission ("SEC"), which covered the offering, issuance and sale by the Company of up to an aggregate of $400.0 million of the Company's common stock, preferred stock, debt securities, units and/or warrants. The Shelf Registration Statement included a prospectus covering the offering, issuance and sale of up to $100.0 million of the Company's common stock from time to time through an "at-the-market" (“ATM”) offering under the Securities Act of 1933, as amended.

Subsequently in December 2024, the Company entered into an Open Market Sale Agreement (the “Sales Agreement”) with TD Cowen Securities (USA) LLC ("TD Cowen"), acting as the Company's Agent and/or principal (the "Sales Agent") with respect to an "at the market offering" program under which the Company may from time to time, at its sole discretion, issue and sell shares of its common stock having an aggregate offering price of up to $100.0 million through the Sales Agent. TD Cowen is entitled to compensation for its services equal to up to 3.0 % of the aggregate gross proceed of any shares of common stock sold through TD Cowen under the Sales Agreement. Pursuant to the Sales Agreement, any shares will be sold pursuant to the Shelf Registration Statement filed with the SEC on December 2, 2024, including the ATM prospectus contained therein, as declared effective by the SEC on December 9, 2024. As of June 30, 2025, there have been no sales of common stock pursuant to the Sales Agreement.

9. Preferred Stock

As of June 30, 2025, the Company was authorized to issue up to 10,000,000 shares of preferred stock at a par value of $0.001 with no preferred stock shares issued or outstanding.

10. Stock-based Compensation

The Company grants stock-based awards under its 2023 Stock Option and Incentive Plan (the "2023 Plan"), which was approved by the Company’s stockholders in November 2023. The Company also has outstanding stock option awards under the Korro Bio Ops, Inc. 2019 Plan (the "Legacy Korro 2019 Plan"), the Frequency 2014 Stock Incentive Plan (the "2014 Plan"), and the Frequency 2019 Incentive Award Plan (the "Frequency 2019 Plan"), but is no longer granting awards under these plans. The Company also has the option to issue shares under the 2023 Employee Stock Purchase Plan (the "2023 ESPP"), which was approved by the Company’s stockholders in November 2023.

Stock-based Compensation Expense

Total stock-based compensation expense recognized in the consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2025 and 2024 was as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Research and development	$	791	$	334	$	1,421	$	613
General and administrative		1,207		633		2,338		1,219
Total stock-based compensation expense	$	1,998	$	967	$	3,759	$	1,832

Stock Option Activity

The fair value of stock options granted during the six months ended June 30, 2025 and 2024 was calculated on the date of grant using the following weighted-average assumptions:


	Six Months Ended June 30,
	2025			2024
Risk-free interest rate		4.3	%		4.3	%
Expected dividend yield		—	%		—	%
Expected term (in years)		6.0			6.0
Expected volatility		73.6	%		74.6	%

Using the Black-Scholes option pricing model, the weighted-average grant date fair value of stock options granted during the six months ended June 30, 2025 and 2024 was $19.42 and $32.46 per share, respectively.

The following table summarizes changes in stock option activity during the six months ended June 30, 2025 (in thousands, except per share amounts):


	Options			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Outstanding at December 31, 2024		1,248,288		$	25.42		8.0	$	21,313
Granted		670,265		$	28.66
Exercised		(13,583	)	$	13.03
Forfeited		(115,741	)	$	29.26
Cancelled		(6,998	)	$	21.08
Outstanding as of June 30, 2025		1,782,231		$	26.50		8.2	$	208
Exercisable at June 30, 2025		689,806		$	24.94		6.7	$	208

The aggregate intrinsic value of options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock for those stock options that had exercise prices lower than the fair value of the common stock as of the end of the period. The aggregate intrinsic value of stock options exercised during the six months ended June 30, 2025 and 2024 was $0.3 million and $0.4 million, respectively.

As of June 30, 2025, there was unrecognized stock-based compensation expense related to unvested stock options of $18.6 million, which the Company expects to recognize over a weighted-average period of approximately 3.1 years.

11. Collaboration Agreements

Genevant Agreement

In March 2023, Legacy Korro entered into a collaboration and license agreement (the “Genevant Agreement”) with Genevant Sciences GmbH (“Genevant”). Key financial terms under the Genevant Agreement are as follows:

•

The Company made a $2.5 million payment to Genevant in March 2023 upon execution of the Genevant Agreement and recorded the payment within research and development expense in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2023.

•

The Company will reimburse Genevant for certain out-of-pocket and full-time equivalent costs incurred as a result of research and development activities performed under the Genevant Agreement.

•

Genevant is entitled to receive payments from the Company upon the achievement of certain milestones, including potential clinical milestone payments of up to $13.5 million, potential regulatory and development milestone payments of up to $27.0 million, and potential commercial milestone payments up to an aggregate total of $57.0 million.

•

Genevant is eligible to receive royalties at percentage rates in the mid-single-digits, based on future annual net sales of licensed products within the scope of the Genevant Agreement.

As of December 31, 2024, one development milestone of $1.0 million had been achieved. In January 2025, the Company announced dosing of the first participants in its Phase 1/2a REWRITE clinical program investigating KRRO-110 as a treatment for AATD, which triggered the second payment of a $1.5 million development milestone. The Company recorded $1.8 million and $2.6 million within research and development expense in the condensed consolidated statement of operations and comprehensive loss during the six months ended June 30, 2025 and 2024, respectively, related to the Genevant Agreement. The Company recorded $0.1 million and $1.6 million within research and development expense in the condensed consolidated statement of operations and comprehensive loss during the three months ended June 30, 2025 and 2024, respectively, related to the Genevant Agreement.

Novo Nordisk Agreement

On September 13, 2024, the Company entered into a research collaboration and license agreement with Novo Nordisk A/S (“Novo Nordisk”), pursuant to which the Company granted Novo Nordisk an exclusive worldwide license under certain intellectual property rights to research, develop, manufacture, commercialize or otherwise exploit certain licensed compounds and licensed products for an initial target in the cardiometabolic field and for a second target (to be nominated by Novo Nordisk within a specified time period as set forth in the agreement). Under the agreement, the Company is responsible for certain research and development activities with respect to licensed compounds and licensed products directed against the initial target and the second target (if nominated by Novo Nordisk), and the Company is eligible to receive cost reimbursement from Novo Nordisk for the Company's performance of such research and development activities under the agreement with respect to such target(s). Novo Nordisk may undertake subsequent worldwide development, manufacturing, marketing and commercialization of the licensed products directed against the initial target and the second target (if applicable). For additional information relating to the terms of such agreement, see Note 13 in the audited consolidated financial statements included in the 2024 10-K.

In October 2024, the Company received an upfront nonrefundable payment of $10.0 million from Novo Nordisk related to the first product candidate, or program target. The Company is entitled to an additional upfront nonrefundable payment from Novo Nordisk upon the selection of the second program target as well as related cost reimbursements.

The Company assessed this arrangement in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers, and concluded that the contract counterparty, Novo Nordisk, is a customer. The Company determined that the research services and the exclusive licenses granted under the collaboration agreement for the initial target are not distinct and, therefore, the Company accounts for the research services and exclusive licenses as a single performance obligation. Additionally, the Company concluded that Novo Nordisk’s option to select a second target does not give rise to a material right or performance obligation until the additional target is selected due to the additional services being priced at standalone selling price. The Company recognizes revenue related to the combined license and research services performance obligation over time using the input method. Under the input method, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation, which the Company believes best measures its progress towards satisfying the combined performance obligation. A cost-based input method of revenue recognition requires management to make estimates of costs to complete the performance obligation. In making such estimates, judgment is required to evaluate assumptions related to cost estimates.

As of June 30, 2025, the total transaction price was determined to be $39.9 million based on the $10.0 million upfront nonrefundable payment and $29.9 million of estimated research services for the first program target. During the six months ended June 30, 2025 and 2024, the Company recognized total collaboration revenue of $4.0 million and $0.0 million, respectively. During the three months ended June 30, 2025 and 2024, the Company recognized total collaboration revenue of $1.5 million and $0.0 million, respectively. The Company is expected to recognize revenue through the first quarter of 2027.

The Company had $3.9 million of current deferred revenue and $4.5 million of noncurrent deferred revenue as of June 30, 2025, based on the period the services are expected to be performed and/or related costs to be incurred. The Company had $1.1 million of current accounts receivable as of June 30, 2025.

The Company will assess the probability of receiving payments from achieving the research and development and regulatory milestones and include the payment in the transaction price when they are deemed probable. Royalties and commercial sale milestones will be recognized when the subsequent sales occur based on the sales or usage-based royalty exception.

12. Commitments and Contingencies

Leases

The Company is party to an operating lease for 50,453 square feet of office and laboratory space at 60 First Street, Cambridge, Massachusetts (the “60 First Street Lease”). In May 2023, the Company obtained control over the space and the Company recognized the operating lease right-of-use asset and the operating lease liability of $26.8 million on the commencement date of the lease. The total rental payments over the 11 year lease are expected to be $62.1 million, including rent credits and other lease incentives per the terms of the lease. Specifically, the 60 First Street Lease provides the Company with a tenant improvement allowance of $13.1 million. The Company utilized full amount of the $13.1 million tenant improvement allowance as of December 31, 2024. The lease has remaining term of approximately 9 years. The Company has an option to extend the lease for an additional period of five years with the rent during the option period being the then fair market rent.

The maturity of undiscounted payments due under lease liabilities and the present value of those liabilities as of June 30, 2025 were as follows (in thousands):


	As of June 30, 2025
2025	$	3,591
2026		7,341
2027		7,557
2028		7,778
2029		8,007
Thereafter		36,713
Total Future Minimum Leases Payments		70,987
Less: Interest		(26,355	)
Present Value of Operating Lease Liabilities	$	44,632

As of June 30, 2025, the weighted average remaining lease term was 8.8 years and the weighted average incremental borrowing rate used to determine the operating lease liability was 11.2%.

The Company combines the lease and non-lease components of fixed costs in its lease arrangements as a single lease component. Variable costs, such as utilities and maintenance costs, are not included in the measurement of right-of-use assets and lease liabilities, but rather are expensed when the event determining the amount of variable consideration to be paid occurs.

The following table summarizes the effect of lease costs in the Company’s condensed consolidated statement of operations and comprehensive loss of its operating leases (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Operating lease costs	$	1,411	$	2,108	$	2,823	$	4,258
Variable lease costs		423		466		907		825
Short-term lease costs		237		252		510		662
Total lease costs	$	2,071	$	2,826	$	4,240	$	5,745

Legal Contingencies

The Company accrues a liability for legal contingencies when it believes that it is both probable that a liability has been incurred and that the Company can reasonably estimate the amount of the loss. The Company reviews these accruals and adjusts them to reflect ongoing negotiations, settlements, rulings, advice of legal counsel and other relevant information. To the extent new information is obtained and the views on the probable outcomes of claims, suits, assessments, investigations or legal proceedings change, changes in the Company’s accrued liabilities would be recorded in the period in which such determination is made.

In addition, in accordance with the relevant authoritative guidance, for any matters in which the likelihood of material loss is at least reasonably possible, the Company will provide disclosure of the possible loss or range of loss. If a reasonable estimate cannot be made, however, the Company will provide disclosure to that effect. The Company expenses legal costs as they are incurred.

The Company was not subject to any material legal proceedings or claims as of June 30, 2025.

Indemnifications

The Company indemnifies each of its officers and directors for certain events or occurrences, subject to certain limits, while the officer or director is or was serving at the Company’s request in such capacity, as permitted under Delaware law and in accordance with the Company’s amended and restated certificate of incorporation and bylaws. The term of the indemnification period lasts as long as an officer or director may be subject to any proceeding arising out of acts or omissions of such officer or director in such capacity.

The maximum amount of potential future indemnification is unlimited; however, the Company currently holds director and officer liability insurance. This insurance allows the transfer of risk associated with the Company’s exposure and may enable the Company to recover a portion of any future amounts paid. The Company believes that the fair value of these potential indemnification obligations is minimal. Accordingly, the Company has not recognized any liabilities relating to these obligations for any period presented.

13. 401(k) Savings Plan

The Company has a defined-contribution savings plan (the “401(k) Plan”) under Section 401(k) of the Internal Revenue Code of 1986, as amended (the "IRC"). The 401(k) Plan covers all employees who meet defined minimum age and service requirements and allows participants to defer a portion of their annual compensation, subject to statutory limitations. Beginning on April 1, 2022, the Company matches 100% of an employee’s 401(k) contributions up to a maximum of 3% of the participant’s salary, subject to employer match limitations under the IRC. As such, the Company made $0.3 million of matching contributions to the 401(k) Plan during each of the six months ended June 30, 2025 and 2024.

14. Net Loss per Share

The following common stock equivalents have been excluded from the calculation of diluted net loss per share because their effect would be anti-dilutive:


	Six Months Ended June 30,
	2025		2024
Outstanding stock options		1,782,231		1,298,408
Outstanding warrant		8,049		8,049
Total		1,790,280		1,306,457

15. Segment Information

The Company operates and manages its business as one reportable segment and one operating segment, which is the business of discovering, developing and commercializing therapies derived from or incorporating its RNA-editing technology. The Company's chief operating decision maker ("CODM") is the chief executive officer.

The CODM assesses performance, monitors budget versus actual results, and decides how to allocate resources based on net loss that also is reported on the consolidated statements of operations and comprehensive loss. The CODM allocates resources based on the Company's available cash resources, forecasted cash flow, and expenditures on a consolidated basis, as well as an assessment of the probability of success of its research and development activities. Resource allocation decisions are informed by budgeted and forecasted expense information, along with actual expenses incurred to date. The accounting policies of the Company's single reportable segment are the same as those described in the summary of significant accounting policies. The level of disaggregation and amounts of significant segment expenses that are regularly provided to the CODM are the same as those presented in the consolidated statements of operations and comprehensive loss. Therefore, duplication of the Company’s consolidated statements of operations and comprehensive in this segment disclosure is not required.

The measure of segment assets is reported on the consolidated balance sheets as total consolidated assets. All long-lived assets are located in the United States. Long-lived assets primarily consist of property and equipment, net, operating lease right-of-use assets and long-term marketable securities.

Factors used in determining the reportable segment include the nature of the Company's operating activities, the organizational and reporting structure and the type of information reviewed by the CODM regularly to allocate resources and evaluate financial performance.

The Company does not have intra-entity sales or transfers.

16. Restructuring

On May 7, 2025, the Company initiated a strategic plan to streamline its operations, including a reduction in Company's workforce by 19%, or 21 positions (the "Workforce Reduction"). During the three months ended June 30, 2025, the Company recorded one-time severance charges in connection with the Workforce Reduction, consisting of cash expenditure for employee separation costs of $1.2 million. All activities related to the Workforce Reduction are expected to be substantially completed during the third quarter of 2025. Restructuring cost accruals are included under the caption “accrued expenses and other current liabilities” in the Company's consolidated balance sheet. Restructuring costs are recognized as an operating expense within the condensed consolidated statement of operations and comprehensive loss and are classified based on the Company’s classification policy for each category of operating expense.

The following is a summary of the activity for the Workforce Reduction:


	Employee separation costs
Balance at December 31, 2024	$	—
Accruals		—
Cash payments		—
Balance at March 31, 2025		—
Accruals		1,233
Cash payments		(456	)
Balance at June 30, 2025	$	777

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report and the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2024, or the 2024 10-K. Some of the information contained in this discussion and analysis, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth under the heading “Risk Factors” in Part I, Item 1A of this Quarterly Report our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. See also “Cautionary Statement Regarding Forward-Looking Statements.”

Overview

We are a clinical-stage biopharmaceutical company with a mission to discover, develop and commercialize a new class of genetic medicines based on editing RNA, enabling the treatment of both rare and highly prevalent diseases.

We are generating a portfolio of differentiated programs that are designed to harness the body’s natural RNA editing process to effect a precise yet transient single base edit. By editing RNA instead of DNA, we are expanding the reach of genetic medicines by delivering additional precision and tunability, which has the potential for increased specificity and improved long-term tolerability. Using an oligonucleotide-based approach, we expect to bring our medicines to patients by leveraging our proprietary platform with precedented delivery modalities, manufacturing know-how, and established regulatory pathways of approved oligonucleotide drugs. However, the scientific evidence to support the feasibility of developing product candidates using our RNA editing technology is both preliminary and limited. Moreover, regulators have not yet established any definitive guidelines related to overall development considerations for RNA editing therapies and limited clinical data has been generated to date.

The versatility of RNA editing combined with our RNA platform broadens the therapeutic target space significantly. While our approach can be used to repair pathogenic single nucleotide variants, or SNVs, as demonstrated by our most advanced clinical-stage program, our AATD product candidate KRRO-110, we can also engineer de novo SNVs and change amino acids on proteins to endow them with desired properties while preserving their broader functional capabilities, as exemplified by three of our other programs (an undisclosed rare metabolic disorder, amyotrophic lateral sclerosis, and pain). In preclinical studies, we have demonstrated that single RNA changes can disrupt protein-protein interactions, prevent protein aggregation, selectively modulate ion channels and activate kinases. These modification approaches can unlock validated target classes that have historically been difficult to drug, enabling us to pursue a broad range of diseases traditionally out-of-scope for other genetic medicine approaches and current traditional drug modalities.

Our clinical-stage development program is investigating KRRO-110 as a treatment for AATD where, using our proprietary RNA editing approach, we are repairing a pathogenic variant on RNA. KRRO-110 has the potential to be disease-modifying and provide a differentiated therapeutic option. In January 2025, we announced dosing of the first participants in our REWRITE clinical program investigating KRRO-110 as a treatment for AATD. REWRITE is a two-part single and multiple dose-escalating Phase 1/2a clinical trial that will evaluate the safety and tolerability of KRRO-110 in up to 64 participants, including healthy adults and clinically stable AATD patients with the PiZZ genotype. Secondary and exploratory endpoints include pharmacokinetic and pharmacodynamic parameters that will guide optimal dose selection for later stage studies. We have completed dosing of over 80% of planned healthy volunteers across multiple single ascending dose cohorts, including dose levels that are expected to be pharmacologically relevant in PiZZ patients. We have not observed any treatment emergent serious adverse events or dose limiting toxicities as of the date of this Quarterly Report on Form 10-Q. In May 2025, we announced approval to expand our Phase 1/2a REWRITE clinical trial of KRRO-110 for AATD into New Zealand, and we continue to progress enrollment, site activation and expansion into other geographies beyond Australia and New Zealand, including the United States. In March 2025 and July 2025, we announced that the U.S. Food and Drug Administration, or FDA, and the European Medicines Agency, or EMA, respectively, granted orphan drug designation to KRRO-110 for the treatment of AATD. Interim data from single ascending doses in healthy volunteers and AATD patients is expected in the second half of 2025, and completion of the REWRITE Phase 1/2a trial, including Part 2 (multiple ascending doses in individuals with AATD), is anticipated in 2026. Based on the preclinical data, we believe KRRO-110 has best-in-class potential for the treatment of AATD. However, KRRO-110 is in early clinical development and there is no guarantee that it will be successful.

We plan to announce a development candidate for our rare metabolic disorder program by the end of 2025. This candidate will be administered subcutaneously and targeted to the liver using GalNAc to create de novo protein variants designed to have therapeutic effect.

In May 2025, we announced a strategic plan to streamline our operations, including a reduction in workforce by 19%, or 21 positions. Please refer to Note 16 in the condensed consolidated financial statements included in this Quarterly Report.

Since inception, we have focused primarily on organizing and staffing our company, business planning, raising capital, securing related intellectual property, and conducting research and development activities for our potential programs and product candidates.

Since inception, we have funded our operations primarily through the private placement of our equity securities. To date, we have raised approximately $223.6 million of aggregate gross proceeds from the sale of our convertible preferred stock, $117.3 million from the sale of shares of common stock issued in a private placement that closed immediately prior to the November 2023 business combination and $70.0 million from the April 2024 private placement of shares of our common stock.

We have incurred significant operating losses since inception. Our net losses were $49.2 million and $41.4 million for the six months ended June 30, 2025 and 2024, respectively. We had an accumulated deficit of $315.7 million as of June 30, 2025. We expect to continue to incur significant and increasing expenses and operating losses and negative operating cash flows for the foreseeable future as we continue our research and development efforts, advance product candidates through clinical development, and seek regulatory approvals for our pipeline candidates. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our preclinical studies, initiation and conduct of any clinical trials, and our expenditures on other research and development activities, including the expansion of our pipeline.

We do not have any product candidates approved for sale and have not generated any revenue from product sales. We will not generate revenue from product sales unless and until we successfully obtain regulatory approval for our product candidates, if ever, and as appropriate, move pipeline candidates into the clinic and complete clinical development. If we obtain regulatory approval for our product candidates and do not enter into third-party commercialization partnerships, we expect to incur significant expenses related to developing commercialization capabilities to support product sales, marketing, manufacturing and distribution activities. As a result, we will need substantial additional funding to support our continuing operations and pursue our development and growth strategy. Until we can generate significant revenue from product sales, if ever, we expect to finance our operations through a combination of public or private offerings of securities, debt financings or other sources, such as potential collaboration agreements, strategic alliances and licensing arrangements. We may be unable to raise additional funds or enter into such other agreements or arrangements when needed on acceptable terms, or at all. Our failure to raise capital or enter into such agreements as, and when needed, could have a negative effect on our business, results of operations and financial condition.

Financial Operations Overview

Revenue

We have not generated any revenue from product sales, and do not expect to generate any revenue from the sale of products in the near future. During the six months ended June 30, 2025, we recognized $4.0 million of collaboration revenue, which is related to our September 2024 research collaboration and license agreement with Novo Nordisk. During the six months ended June 30, 2024, we recognized no collaboration revenue.

For additional information about our revenue recognition policy and our collaboration and license agreement with Novo Nordisk, see Note 11 in the condensed consolidated financial statements included in this Quarterly Report.

Operating Expenses

Research and Development Expenses

Research and development expenses consist primarily of costs incurred for our research activities, including our discovery of novel genetic medicines and the development of our product candidates, salaries and benefits, and third-party license fees. We expense research and development costs as incurred, which include:

•

employee-related expenses, including salaries, bonuses, benefits, stock-based compensation and other related costs for those employees involved in research and development efforts;

•

expenses incurred under agreements with contract research organizations, or CROs, that conduct our preclinical studies and clinical trials;

•

costs of purchasing lab supplies and non-capital equipment used in our preclinical activities and in manufacturing preclinical study materials, as well as supplies and materials used to manufacture clinical trial materials;

•

costs of outside consultants and contractors engaged in research and development activities, including their fees and travel expenses;

•

payments made under third-party licensing agreements; and

•

direct and allocated expenses for facilities.

Costs for certain activities are recognized based on an evaluation of the progress to completion of specific tasks using data such as information provided to us by our vendors and analyzing the progress of our preclinical studies, clinical trials or other services performed. Nonrefundable advance payments for goods or services to be received in the future for use in research and development

activities are capitalized. The capitalized amounts are expensed as the related goods are delivered or the services are performed. Significant judgment and estimates are made in determining the accrued expense balances and prepaid expense balances at the end of any reporting period.

A large portion of our research and development expenses have been external expenses, which we track on a program-by-program basis following nomination as a development candidate. Our internal research and development expenses are primarily personnel-related expenses, including stock-based compensation expense and facility expenses, mainly including office rent expenses and depreciation expenses. We do not allocate our internal research and development expenses to specific drug candidate programs as they are deployed across multiple projects under research and development.

The successful development of our product candidates is highly uncertain. We plan to substantially increase our research and development expenses for the foreseeable future as we continue the development of our product candidates, conduct discovery and research activities for our preclinical programs, and expands our pipeline. We cannot determine with certainty the timing of initiation, the duration or the completion costs of current or future preclinical studies and clinical trials of our product candidates due to the inherently unpredictable nature of preclinical and clinical development. Clinical and preclinical development timelines, the probability of success and development costs can differ materially from expectations. We anticipate that we will make determinations as to which product candidates to pursue and how much funding to direct to each product candidate on an ongoing basis in response to the results of ongoing and future preclinical studies and clinical trials, regulatory developments and our ongoing assessments as to each product candidate’s commercial potential. Our clinical development costs are expected to increase significantly as we commence clinical trials. We anticipate that our expenses will increase substantially, particularly due to the numerous risks and uncertainties associated with developing product candidates, including the uncertainty of:

•

the scope, rate of progress, and expenses of our ongoing research activities as well as any preclinical studies, clinical trials and other research and development activities;

•

establishing an appropriate safety profile with IND enabling studies;

•

successful enrollment in and completion of clinical trials;

•

whether our product candidates show safety and efficacy in our clinical trials;

•

receipt of marketing approvals from applicable regulatory authorities;

•

making arrangements with third-party manufacturers;

•

obtaining and maintaining patent and trade secret protection and regulatory exclusivity for our product candidates;

•

commercializing product candidates, if and when approved, whether alone or in collaboration with others; and

•

continued acceptable safety profile of products following any regulatory approval.

Any changes in the outcome of any of these variables with respect to the development of our product candidates in preclinical and clinical development could mean a significant change in the costs and timing associated with the development of these product candidates. We may never succeed in achieving regulatory approval for any of our product candidates. We may obtain unexpected results from our clinical trials. We may elect to discontinue, delay or modify clinical trials of some product candidates or focus on other product candidates. For example, if the FDA, EMA, HREC, Therapeutic Goods Administration, or TGA, the Health and Disability Ethics Committees, or HDEC, or another regulatory authority were to delay the planned start of clinical trials or require us to conduct clinical trials or other testing beyond those that we currently expect or if we experience significant delays in enrollment in any planned clinical trial, we could be required to expend significant additional financial resources and time on the completion of clinical development of that product candidate.

General and Administrative Expenses

General and administrative expenses consist primarily of employee related costs, including salaries, bonuses, benefits, stock-based compensation and other related costs for our executive and administrative functions. General and administrative expenses also include professional services, including legal, finance, accounting, human resources and other consulting fees. General and administrative expenses also include facility costs not otherwise included in research and development expenses.

We expect to continue to incur costs associated with being a public company and maintaining controls over financial reporting, including costs of accounting, audit, legal, regulatory, compliance and director and officer insurance costs as well as investor and public relations expenses.

Other Income, Net

Other income, net primarily consists of interest income earned on money market fund accounts and marketable securities.

Results of Operations

Comparison of the Three and Six Months Ended June 30, 2025 and 2024

The following table summarizes our results of operations for the three and six months ended June 30, 2025 and 2024:


	Three Months Ended June 30,									Six Months Ended June 30,
(in thousands)	2025			2024			Change			2025			2024			Change
Collaboration revenue	$	1,460		$	—		$	1,460		$	4,010		$	—		$	4,010
Operating expenses:
Research and development	$	21,031		$	17,138		$	3,893		$	40,770		$	30,710		$	10,060
General and administrative		7,631			6,987			644			15,462			14,868			594
Total operating expenses		28,662			24,125			4,537			56,232			45,578			10,654
Loss from operations		(27,202	)		(24,125	)		(3,077	)		(52,222	)		(45,578	)		(6,644	)
Other income, net
Other income, net		1,433			2,329			(896	)		3,066			4,242			(1,176	)
Total other income, net		1,433			2,329			(896	)		3,066			4,242			(1,176	)
Loss before provision for income taxes		(25,769	)		(21,796	)		(3,973	)		(49,156	)		(41,336	)		(7,820	)
Provision for income taxes		(1	)		(30	)		29			(1	)		(47	)		46
Net loss	$	(25,770	)	$	(21,826	)	$	(3,944	)	$	(49,157	)	$	(41,383	)	$	(7,774	)

Collaboration Revenue

During the three and six months ended June 30, 2025, we recognized $1.5 million and $4.0 million, respectively, of collaboration revenue from our research collaboration and license agreement with Novo Nordisk. During the three and six months ended June 30, 2024, we recognized no collaboration revenue.

Research and Development Expenses

The following table summarizes our research and development expenses for the three and six months ended June 30, 2025 and 2024:


	Three Months Ended June 30,							Six Months Ended June 30,
(in thousands)	2025		2024		Change			2025		2024		Change
Development candidate expenses
KRRO-110 (AATD) external expenses	$	6,435	$	6,972	$	(537	)	$	12,557	$	9,222	$	3,335
Unallocated research and development expenses
Other research and pre-development candidate expenses		5,345		2,972		2,373			9,695		6,272		3,423
Personnel expenses		6,578		4,339		2,239			13,018		9,551		3,467
Facilities expenses		2,673		2,855		(182	)		5,500		5,665		(165	)
Total research and development expenses	$	21,031	$	17,138	$	3,893		$	40,770	$	30,710	$	10,060

Research and development expenses were $21.0 million for the three months ended June 30, 2025, compared to $17.1 million for the three months ended June 30, 2024. The increase was primarily due to a $2.4 million increase in other research and pre-development candidate expenses as we furthered development of our rare metabolic disorders program, a $2.2 million increase in personnel-related expenses mainly driven by an increase in headcount prior to the May 2025 workforce reduction, increased average payroll costs per headcount to support our research and clinical development function, and one-time severance charges related to the workforce reduction, offset by a $0.5 million decrease in KRRO-110 external expenses.

Research and development expenses were $40.8 million for the six months ended June 30, 2025, compared to $30.7 million for the six months ended June 30, 2024. The increase was primarily due to a $3.3 million increase in KRRO-110 external expenses, which was attributable to a $2.8 million increase in clinical trial expenses in 2025 for the Phase 1/2a REWRITE clinical trial and a $0.5 million net increase in development milestone under our collaboration and license agreement with Genevant Sciences GmbH. A portion of the increase was also due to a $3.5 million increase in personnel-related expenses mainly driven by an increase in headcount prior to the May 2025 workforce reduction, increased average payroll costs per headcount to support our research and clinical

development function and one-time severance charges related to the workforce reduction, and a $3.4 million increase in other research and pre-development candidate expenses as we furthered development of our rare metabolic disorders program.

General and Administrative Expenses

The following table summarizes our general and administrative expenses for the three and six months ended June 30, 2025 and 2024:

      
     Three Months Ended June 30,

     Six Months Ended June 30,

     (in thousands)

     2025

     2024

     Change

Korro Bio, Inc. 10-Q