CDXS

MKT CAP $140.2MP/E —DIV YIELD —FCF YIELD -8.69%REV TTM $77.7M +35.9%NET INCOME −$30.7MNET DEBT $13.7M52W 0.98 – 2.85SEC XBRL · TTM TO Invalid Date

How CDXS rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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We have incurred net losses since our inception, including losses of $44.0 million, $65.3 million, and $76.2 million for the years ended December 31, 2025, 2024, and 2023, respectively.
As of December 31, 2025, we had an accumulated deficit of $606.8 million.
If we are unable to continue to successfully develop and commercialize products in our pharma biocatalysis business, increase sales of existing products and services, develop and commercialize our ECO Synthesis manufacturing platform, develop new products or services, or otherwise expand our business, whether through new or expanded collaborations or other products and services, our net losses may increase and we may never achieve profitability.
In addition, some of our agreements, including the agreements with GlaxoSmithKline plc (“GSK”), Merck Sharp & Dohme (“Merck”), Novartis Pharma AG (“Novartis”), Nestlé Health Science (“Nestlé”), Aldevro n LLC, Roche Sequencing Solutions, Inc., Crosswalk Therapeutics and Alphazyme LLC, provide for milestone payments, usage payments, and/or future royalty or other payments, which we will only receive if we and/or our collaborators develop and commercialize products or achieve technical milestones.
We develop enzyme products, including our ECO Synthesis manufacturing platform, that are used by our customers, and that may be used by our future customers or collaborators in connection with their biotherapeutic product candidates.
To market a biologic or drug product in the United States, our customers, future customers or collaborators must undergo the following process required by the FDA: • completion of extensive preclinical laboratory tests and preclinical animal studies, certain of which must be performed in accordance with the FDA's Good Laboratory Practice requirements; • submission to the FDA of an Investigational New Drug Application, which must become effective before human clinical studies may begin in the United States; • approval by an independent institutional review board or ethics committee representing each clinical site before the clinical study may be initiated at the site; • performance of adequate and well-controlled human clinical studies in accordance with Good Clinical Practice requirements to establish the safety, purity and potency (or efficacy) of the product candidate for each proposed indication; • preparation of and submission to the FDA of a New Drug Application (“NDA”) or Biologics License Application (“BLA”) after completion of all clinical studies; • potential review of the product candidate by an FDA advisory committee; • satisfactory completion of an FDA pre-approval inspection of the manufacturing facilities where the product candidate is produced to assess compliance with current Good Manufacturing Practice (“cGMP”) requirements; • FDA review and approval of a BLA or NDA prior to any commercial marketing or sale of the product in the United States; and • any post-approval requirements, if applicable.
We believe our enzyme products are exempt from compliance with the FDCA and the FDA’s GMP implementing regulations, as our products are further processed and not incorporated into final drug or biologic products by our customers and as we do not make claims related to our products’ safety or effectiveness.
Our products are currently manufactured following the voluntary quality standards of ISO 9001:2015, and we have collaborations with a number of CDMOs, and anticipate signing and announcing additional partnerships to provide enzymatically synthesized, GMP-grade siRNA to customers in the near term.
Our collaboration with CDMOs may not come to fruition and, even if it does, may not scale up as anticipated.
Even if the scale up plans succeed, we or the CDMO may incur delays in production or have insufficient product for customers.
In the future, our products could become subject to more onerous regulation, or the FDA could disagree with our assessment that our enzyme products are exempt from cGMP regulations.
For the years ended December 31, 2025 and 2024, customers that each individually contributed 10% or more of our total revenue accounted for 51% of our total revenues.
For the year ended December 31, 2025, we derived a majority of our product revenue from these product supply agreements.
If we are unable to develop and commercialize new products for the pharmaceutical and life science tools markets, our business and prospects will be harmed.
We plan to continue to innovate new technologies for use in the pharmaceutical and life science tools markets.
If government proposals to reduce or eliminate budgetary deficits result in reduced allocations to government agencies that fund research and development activities, our results of operations may be materially adversely affected.
With respect to customers purchasing our products for use in manufacturing APIs for which they have exclusivity due to patent protection, the termination or expiration of such patent protection and any resulting generic competition may materially and adversely affect our revenues, financial condition or results of operations.
With respect to customers purchasing our products for the manufacture of API, or to lead to the manufacture of API, for which exclusivity due to patent protection has or is about to expire, we can expect that the quantity of our products sold to such customers for such products may decline as generic competition for the API increases.
We manufacture our enzymes primarily in four locations: our in-house facility in Redwood City, California, and at three third-party contract manufacturing organizations (“CMOs”): Lactosan in Kapfenberg, Austria, ACS Dobfar S.p.A.
(“ACSD”) (formerly known as DPhar S.p.A.) in Anagni, Italy, and Sekisui Diagnostics in Maidstone, United Kingdom.
We may be forced to secure alternative sources of supply, which may be unavailable on commercially acceptable terms, and could cause interruptions or delays in our ability to deliver products to our customers, increase our costs and decrease our profit margins.
Furthermore, as we currently,and may in the future, rely on foreign CMOs, such foreign CMOs may be subject to U.S. legislation, sanctions, trade restrictions and other foreign regulatory requirements which could increase the cost or reduce the supply of material available to us, delay the procurement or supply of such material or have an adverse effect on our ability to secure significant commitments from governments to purchase our potential therapies.
BIOSECURE Act, which was enacted in December 2025, prohibits federal agencies from procuring or using any biotechnology equipment or services from “biotechnology companies of concern”, or entering into, extending, or renewing any contracts with entities that use such biotechnology equipment or services from “biotechnology companies of concern”.
Congress has interpreted a “biotechnology company of concern” as an entity that is under the control of a foreign adversary and that poses a risk to national security based on its research or multiomic data collection (e.g., collection of genomic information).
BIOSECURE Act has a grandfathering period of five years for existing contracts, and has carveouts for manufacture of drugs for supply under Medicaid and Medicare Part B, subject to the Secretary of Veterans Affairs’ discretion, the impact of the U.S.
BIOSECURE Act on the biotechnology industry is uncertain.
This and similar laws could have the potential to restrict the ability of biopharmaceutical companies like us to purchase services or products from, or otherwise collaborate with, certain biotechnology companies “of concern” without losing the ability to contract with, or otherwise receive funding from, the U.S. government.
It is possible some of our contractual counterparties could be impacted by this or future legislation.
Failure to validate performance at scale, demonstrate regulatory acceptance, or overcome other challenges with the new technologies could impede customer adoption and our revenues.
Other challenges with a new technology such as our ECO Synthesis manufacturing platform include having an unknown and unproven development and regulatory path, uncertainty around the value that we can realize from the technology, uncertainty around the timeline for adoption of the technology by customers, and uncertainty around our ability to secure supply of necessary materials or to manufacture at GMP at scale and partner with customers on manufacturing and utilizing the technology.
The current industry standard for manufacturing RNAi therapeutics is a well-established, chemical-based method, solid-phase oligonucleotide synthesis, utilizing phosphoramidite chemistry.
We are aware that other companies, including Ginkgo Bioworks, BRAIN Biotech AG, and Enzymicals AG, have alternative methods for obtaining and generating genetic diversity or use mutagenesis techniques to produce genetic diversity.
Some companies, including Biomatter Designs, Arzeda Corp., and Enzymaster, leverage predictive computational algorithms to guide enzyme engineering efforts.
These companies include many of our large innovator and generic pharmaceutical customers, such as Merck, GSK, Novartis, Pfizer Inc., Bristol-Myers Squibb, Kyorin Pharmaceutical Corporation, and Teva Pharmaceuticals, which have significant internal research and development efforts directed at developing processes to manufacture APIs and intermediates.
The market for supplying enzymes is fragmented.
There is competition from large industrial enzyme companies, such as Novozymes and DuPont, as well as subsidiaries of larger contract research/CMOs, such as DSM-Firmenich AG, Cambrex Corporation, Lonza Group, WuXi STA and Almac Group Ltd.
Some fermentation pathway design companies, like Ginkgo Bioworks, whose traditional focus has been to design microorganisms that express small molecule chemicals, could extend into designing organisms that express enzymes.
There is also competition in the enzyme customization and optimization area from several smaller companies, such as BRAIN Biotech AG, Arzeda Corp., and c-LEcta GmbH.
As a result, our competitors may be able to develop competing and/or superior technologies and processes, compete more aggressively and sustain that competition over a longer period of time than we could.
As a result of our refined focus on certain programs and business lines, we may fail to capitalize on other opportunities that may be more profitable or for which there is a greater likelihood of success.

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Gone since FY2024

Additional discussion of the material risks and uncertainties summarized in this risk factor summary, as well as certain other risks and uncertainties that we face, can be found in this section.
RISK FACTORS SUMMARY The following is a summary of the principal factors that cause an investment in the Company to be speculative or risky: • We have a history of net losses and we may not achieve or maintain profitability. • Therapeutics development prorams are highly regulated and expensive, and our enzyme products are complex and subject to quality control requirements.
The ability of our customers, future customers or collaborators, including any company developing RNAi and other RNA-based therapeutics, to advance product candidates utilizing our products to clinical trials and to ultimately receive regulatory approvals is highly uncertain. • We believe that our products are exempt from Food, Drug, and Cosmetic Act (“FDCA”) requirements, but FDA or other regulators may disagree and find that our products are subject to such requirements. • We are dependent on a limited number of customers. • Some of our product supply agreements with customers have finite duration and may not be extended or renewed. • The demand for our product depends in part on our customers' research and development and the clinical and market success of their products. • If we are unable to develop and commercialize new products for our target markets, our business and prospects will be harmed. • A reduction or delay in government funding of research and development for our customers may adversely affect our business. • With respect to customers purchasing our products for the manufacture of API for which they have exclusivity due to patent protection, the termination or expiration of such patent protection and any resulting generic competition may materially and adversely affect our revenues, financial condition or results of operations. • The services and offerings we provide are highly complex, and if we encounter problems providing the services or support required, our business could suffer. • Any productivity issues or higher-than-expected costs at our facilities could result in material and adverse impacts on our financial condition and results of operations. • We are dependent on a limited number of third-party contract manufacturers for large scale production of substantially all of our enzymes. • We are dependent on our collaborators, and our failure to successfully manage these relationships could prevent us from developing and commercializing many of our products. • We have invested significant resources to enable enzymatic nucleic acid synthesis, which is based on novel ideas and technologies that are largely unproven. • As a result of our strategic shift and our refined focus on the revenue-generating pharma biocatalysis business and the ECO Synthesis platform, we may fail to capitalize on other opportunities that may be more profitable or for which there is a greater likelihood of success. • Given our change in strategic direction, we may receive limited revenue or no future value from certain of our existing license agreements. • The timing of customer orders and related product revenue recognition is unpredictable and may cause our operating results to vary significantly from quarter to quarter, which could adversely affect our stock price. • We use hazardous materials in our business, and we must comply with environmental laws and regulations. • We may need additional capital in the future in order to expand our business. • We may not be able to comply with the terms of our five-year term loan and security agreement (our “Loan Agreement”) with Innovatus Life Sciences Lending Fund I, LP (“Innovatus”), an affiliate of Innovatus Capital Partners, LLC . • Even if our customers or collaborators obtain regulatory approval for any products utilizing our enzymes, such products will remain subject to ongoing regulatory requirements, which may result in significant additional expense. • If we or our customers fail to comply with certain healthcare laws, including fraud and abuse laws, we could face substantial penalties and our business, results of operations, financial condition and prospects could be adversely affected. • Our efforts to prosecute, maintain, protect and/or defend our intellectual property rights may not be successful. • Third parties may claim that we are infringing, violating or misappropriating their intellectual property rights, which may subject us to costly and time-consuming litigation and prevent us from developing or commercializing our technology, products or services. • We may be involved in lawsuits to protect or enforce our intellectual property rights, which could be expensive, time-consuming and unsuccessful. • If our biocatalysts are stolen, misappropriated or reverse engineered, others could use these biocatalysts to produce competing products. • We are subject to anti-takeover provisions in our certificate of incorporation and bylaws and under Delaware law that could delay or prevent an acquisition of our company. • Market and economic conditions may negatively impact our business, financial condition, and share price. • Business interruptions resulting from political events, disasters or other disturbances could delay us in the process of developing our products and could disrupt our sales.
We have incurred net losses since our inception, including losses of $65.3 million, $76.2 million, and $33.6 million for the years ended December 31, 2024, 2023, and 2022, respectively.
As of December 31, 2024, we had an accumulated deficit of $562.8 million.
If we are unable to continue to successfully develop and commercialize products in our pharma biocatalysis business, increase sales of existing products and services, develop and commercialize our ECO Synthesis manufacturing platform, and or develop new products or services, or otherwise expand our business, whether through new or expanded collaborations or other products and services, our net losses may increase and we may never achieve profitability.
In addition, some of our agreements, including the agreements with GSK, Merck, Novartis, Nestlé, Aldevro n, Roche, Crosswalk and Alphazyme provide for milestone payments, usage payments, and/or future royalty or other payments, which we will only receive if we and/or our collaborators develop and commercialize products or achieve technical milestones.
Although we are no longer developing our own portfolio of biotherapeutics product candidates, we continue to develop enzyme products, including our ECO Synthesis manufacturing platform, that may be used by our customers, future customers or collaborators in connection with their biotherapeutic product candidates.
In order to market a biologic or drug product in the United States, our customers, future customers or collaborators must undergo the following process required by the FDA: • completion of extensive preclinical laboratory tests and preclinical animal studies, all performed in accordance with the FDA's Good Laboratory Practice requirements; • submission to the FDA of an IND, which must become effective before human clinical studies may begin in the United States; • approval by an independent institutional review board (“IRB”) representing each clinical site before the clinical study may be initiated at the site; • performance of adequate and well-controlled human clinical studies in accordance with GCP requirements to establish the safety, purity and potency (or efficacy) of the product candidate for each proposed indication; • preparation of and submission to the FDA of an NDA or BLA after completion of all clinical studies; • potential review of the product candidate by an FDA advisory committee; • satisfactory completion of an FDA pre-approval inspection of the manufacturing facilities where the product candidate is produced to assess compliance with current Good Manufacturing Practice (“cGMP”) requirements; • FDA review and approval of a BLA or NDA prior to any commercial marketing or sale of the product in the United States; and • any post-approval requirements, if applicable.
We believe our enzyme products are exempt from compliance with the FDCA and the implementing GMP regulations of the FDA, as our products are further processed and incorporated into final drug or biologic products by our customers and we do not make claims related to their safety or effectiveness.
Our products are currently manufactured following the voluntary quality standards of ISO 9001:2015, and we anticipate signing and announcing a partnership with a CDMO to provide enzymatically synthesized, GMP-grade siRNA to customers in the near term.
Our planned collaboration with a CDMO may not come to fruition and, even if it does, may not scale up as anticipated.
Even if the scale up plans succeed, we or the CDMO may incur delays in production or have insufficient product for consumers.
In the future, our products could become subject to more onerous regulation, or the FDA could disagree with our assessment that our enzyme products are exempt from current GMP regulations.
For the years ended December 31, 2024 and 2023, customers that each individually contributed 10% or more of our total revenue accounted for 51% and 35% of our total revenues, respectively.
For the year ended December 31, 2024, we derived a majority of our product revenue from these product supply agreements.
If we are unable to develop and commercialize new products for the pharmaceutical, biotherapeutics, diagnostics and life science tools markets, our business and prospects will be harmed.
We plan to launch new products for the pharmaceutical, biotherapeutics, diagnostics and other life science tools markets such as our ECO Synthesis manufacturing platform.
If government proposals to reduce or eliminate budgetary deficits result in reduced allocations to government agencies that fund research and development activities, or results of operations may be materially adversely affected.
With respect to customers purchasing our products for the manufacture of APIs for which they have exclusivity due to patent protection, the termination or expiration of such patent protection and any resulting generic competition may materially and adversely affect our revenues, financial condition or results of operations.
With respect to customers purchasing our products for the manufacture of API, or lead to the manufacture of API, for which exclusivity due to patent protection has or is about to expire, we can expect that the quantity of our products sold to such customers for such products may decline as generic competition for the API increases.
We are working to qualify new contract manufacturers to produce certain of our enzymes, however those efforts may not be successful and therefore we may experience limitations on our ability to supply our enzymes to customers.
Manufacturing of our enzymes is conducted primarily in four locations: our in-house facility in Redwood City, California, and at three third-party CMOs: Lactosan in Kapfenberg, Austria, ACSD in Anagni, Italy, and Sekisui in Maidstone, United Kingdom.
We may be forced to secure alternative sources of supply, which may be unavailable on commercially acceptable terms, and could cause delays in our ability to deliver products to our customers, increase our costs and decrease our profit margins.
Other challenges with a new technology such as our ECO Synthesis manufacturing platform include having an unknown and unproven development and regulatory path, uncertainly around the value that we can realize from the technology, uncertainty around the timeline for adoption of the technology by customers, and uncertainly around our ability to secure supply of necessary materials or to manufacture at GMP at scale and partner with customers on manufacturing and utilizing the technology.
We are aware that other companies, including Ginkgo Bioworks, BRAIN, and Enzymicals AG, have alternative methods for obtaining and generating genetic diversity or use mutagenesis techniques to produce genetic diversity.
Some companies, including Biomatter Designs, Arzeda, and Enzymaster, leverage predictive computational algorithms to guide enzyme engineering efforts.
These companies include many of our large innovator and generic pharmaceutical customers, such as Merck, GSK, Novartis, Pfizer, Bristol-Myers, Kyorin, Urovant, and Teva which have significant internal research and development efforts directed at developing processes to manufacture APIs and intermediates.
The market for supplying enzymes for use in pharma biocatalysis is fragmented.
There is competition from large industrial enzyme companies, such as Novozymes and DuPont, as well as subsidiaries of larger contract research/contract manufacturing organizations, such as DSM, Cambrex Corporation, Lonza, WuXi STA and Almac Group Ltd.
Some fermentation pathway design companies, like Ginkgo Bioworks (who recently acquired Zymergen), whose traditional focus has been to design microorganisms that express small molecule chemicals, could extend into designing organisms that express enzymes.
There is also competition in the enzyme customization and optimization area from several smaller companies, such as BRAIN AG, Arzeda Corp., c-LEcta GmbH and Evocatal GmbH.
The current industry standard for manufacturing RNAi therapeutics is a well-established, chemical-based method, SPOS, utilizing phosphoramidite chemistry.
As a result, our competitors may be able to develop competing and/or superior technologies and processes and compete more aggressively and sustain that competition over a longer period of time than we could.
We have investments in non-marketable securities, which may subject us to significant impairment charges.
We have investments in illiquid or non-marketable equity securities acquired in private transactions.
As of December 31, 2024, 1.9% of our consolidated assets consisted of investment securities, which are illiquid investments.
Investments in non-marketable, securities are inherently risky and difficult to value.
We account for our non-marketable equity securities under the measurement alternative.
Under the measurement alternative, the carrying value of our non-marketable equity investments is adjusted to fair value for observable transactions for identical or similar investments of the same issuer or impairment.

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Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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