Source: sec
Source ID: 0001816590-26-000076
URL: https://www.sec.gov/Archives/edgar/data/1816590/000181659026000076/cmps-20260930.htm
Symbol: (CMPS)
Published: 2026-11-03 08:07:22 EST
Time precision: minute
Title: 10-Q 10-Q

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
10-Q
⊠
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
September 30, 2026
OR
☐
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:
001-39522
COMPASS Pathways plc
(Exact name of registrant as specified in its charter)
England and Wales
Not Applicable
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
33 Broadwick Street
London
W1F 0DQ
United Kingdom
(Address of principal executive offices, zip code)
+1 (
716
)
676-6461
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
Trading Symbol
Name of each exchange on which registered
American Depositary Shares, each representing one ordinary share, par value of £0.008 per share
CMPS
Nasdaq Global Select 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, a 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
☒
The registrant had
141,710,353
shares of common stock outstanding as of
October 28, 2026
.
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
Item 1.
Financial Statements (Unaudited)
8
Condensed Consolidated Balance Sheets as of September 30, 2026 and December 31, 2025
8
Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months ended September 30, 2026 and 2025
9
Condensed Consolidated Statements of Shareholders' Equity (Deficit) for the Three Months Ended September 30, 2026 and 2025, the Three Months Ended June 30, 2026 and 2025, and the Three Months Ended March 31, 2026 and 2025
10
Condensed Consolidated Statements of Cash Flows for the Nine Months ended September 30, 2026 and 2025
12
Notes to Condensed Consolidated Financial Statements
14
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
23
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
32
Item 4.
Controls and Procedures
33
PART II - OTHER INFORMATION
Item 1.
Legal Proceedings
34
Item 1A.
Risk Factors
34
Item 2.
Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities
104
Item 3.
Defaults Upon Senior Securities
104
Item 4.
Mine Safety Disclosures
104
Item 5.
Other Information
104
Item 6.
Exhibits
105
Signatures
106
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q includes forward-looking statements 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”. Forward-looking statements generally relate to future events or our future financial or operating performance. All statements other than statements of historical fact included in this Quarterly Report on Form 10-Q, including regarding our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these words or other similar terms or expressions. The forward-looking statements and opinions contained in this Form 10-Q are based upon information available to our management as of the date of this Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:
•
our expectations regarding the timing of our rolling submission of a new drug application, or NDA, for COMP360 psilocybin treatment in treatment-resistant depression, or TRD, and the timing of the review by the Food and Drug Administration, or FDA, of such NDA, including potential acceleration due to the grant of rolling review and award of a National Priority Voucher for COMP360 psilocybin treatment in TRD and the results of our Phase 3 program in TRD, including statements regarding the preliminary results to date from our two Phase 3 trials for TRD;
•
the expected timing of our commercial launch for COMP360 psilocybin treatment in TRD, if approved by the FDA, including the timing and substance of decisions by the U.S. Drug Enforcement Administration, or the DEA, and states to reschedule COMP360 psilocybin treatment, if approved by FDA, which contains Schedule I controlled substances and must be rescheduled before commercializing COMP360 psilocybin in the U.S.;
•
the timing, progress and results of our Phase 2b/3 clinical trial in post-traumatic stress disorder, or PTSD, including statements regarding our trial designs and our expectations regarding discussions with the FDA, including discussions regarding our trial design;
•
our estimates regarding our expenses, capital requirements, the sufficiency of our cash resources and our expected cash runway;
•
our reliance on the success of our investigational COMP360 psilocybin treatment;
•
our expectations regarding the size of the eligible patient populations for COMP360 psilocybin treatment, if approved for commercial use;
•
our ability to identify third-party clinical sites to conduct our trials and our ability to identify and train appropriately qualified healthcare professionals to monitor and safeguard participants receiving COMP360 psilocybin treatment in our clinical trials;
•
our ability to implement our business model and our strategic plans for our business and our investigational COMP360 psilocybin treatment;
•
our ability to identify new indications for COMP360 beyond our current primary focus on TRD and PTSD;
•
our commercialization, marketing and manufacturing capabilities and strategy, including our ability to accelerate our commercial launch planning;
•
the expected pricing, coverage and reimbursement of our investigational COMP360 psilocybin treatment, if approved;
•
the scalability and commercial viability of our manufacturing methods and processes, including our ability to add commercial manufacturing capacity in the U.S.;
•
the rate and degree of market acceptance and clinical utility of our investigational COMP360 psilocybin treatment, in particular, and psilocybin-based treatments, in general;
•
our ability to raise additional capital or secure other financing to fund our operations;
•
the potential for outstanding warrants to purchase American Depositary Shares, or ADSs, to be exercised in full for cash and any expected proceeds from the exercise of our outstanding warrants;
•
our ability to establish or maintain collaborations or strategic relationships;
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•
our expectations regarding potential benefits of our investigational COMP360 psilocybin treatment and our treatment approach generally;
•
our expectations around feedback from, and discussions with regulators regarding regulatory development paths and Controlled Substances Act designation, each of which may be subject to potential impacts of regulatory agency staffing cuts and policy changes on regulatory feedback and timing thereof;
•
the scope of protection we and any current or future licensors or collaboration partners are able to establish and maintain for intellectual property rights covering COMP360;
•
our ability to operate our business without infringing, misappropriating, or otherwise violating the intellectual property rights and proprietary technology of third parties;
•
our ability to identify, maintain, utilize, acquire or purchase digital technologies for use in the conduct of our clinical trials;
•
regulatory developments in the United States, or U.S., under the laws and regulations of England and Wales, and other jurisdictions;
•
developments and projections relating to our competitors and our industry, including our expectations regarding the development, regulatory approval and commercialization of competing therapies, the potential approval of competing therapies before COMP360 or for broader indications, and the potential impact on market acceptance, pricing and commercial opportunities for COMP360;
•
the effectiveness of our internal control over financial reporting;
•
our ability to attract and retain qualified employees and key personnel, including our ability to grow our commercial team;
•
our ability to achieve specified regulatory and commercial milestones, and in the case of the final tranche to secure approval from lenders’ investment committees, to draw down additional amounts up to $100.0 million in accordance with the terms of our Loan and Security Agreement, as amended by the third amendment dated January 5, 2026, or the Loan Agreement, with Hercules Capital, Inc., or Hercules, and our ability to comply with the operating and financial covenants, including the minimum cash covenant, in our Loan Agreement;
•
the effect of global financial and economic conditions and geopolitical events, including fluctuating interest rates and inflation, foreign exchange fluctuations (particularly the Pound Sterling to U.S. Dollar), the risk of an economic slowdown or recession in the U.S., overall market volatility in the U.S. or the UK, including as a result of, among other factors, geopolitical conflict (such as, the war between Russia and Ukraine and conflict in the Middle East), international tensions or instability (including from the effects of announced or future tariff increases), significant changes in U.S. policies or regulatory environment or the disruption to U.S. government agencies or similar events, on our business;
•
the effect of public health crises, pandemics or epidemics and any future mitigation efforts, and current or future economic effects, on any of the foregoing or other aspects of our business or operations;
•
whether we are classified as a controlled foreign corporation, or CFC, or a passive foreign investment company, or PFIC, under the Internal Revenue Code of 1986, as amended, for current and future periods; and
•
the future trading price of the ADSs and impact of securities analysts’ reports on these prices.
We caution you that the foregoing list may not contain all of the forward-looking statements made in this Quarterly Report on Form 10-Q.
You should not rely upon forward-looking statements as predictions of future events, which speak only as of the date made. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations and prospects. The outcomes of the events described in these forward-looking statements are subject to risks, uncertainties and other factors described in the section titled “Risk Factors” in Part II, Item 1A, of this Quarterly Report on Form 10-Q and our other filings with the Securities and Exchange Commission, or the SEC. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report on Form 10-Q. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements. Except as otherwise required by law, we disclaim any obligation to
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subsequently revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
References to “we,” “our,” “us” and “the Company” refer to Compass Pathways plc.
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SUMMARY OF THE MATERIAL RISKS ASSOCIATED WITH OUR BUSINESS
Our business is subject to numerous risks and uncertainties that you should be aware of in evaluating our business. These risks and uncertainties include, but are not limited to, the following:
•
We are a clinical-stage biotechnology company and have incurred significant losses since our inception. We expect to incur losses until such time as we can generate revenue from sales of COMP360 or other therapeutic candidates sufficient to sustain profitability and may never achieve or maintain profitability;
•
Unless and until we generate product revenue and achieve and sustain profitability, we will continue to need additional financing to fund our operations and capital expenditures. Failure to obtain additional funding when needed or on favorable terms may force us to delay, limit or terminate certain or all of our product discovery, therapeutic development, research operations or commercialization efforts or grant rights to develop and market products or therapeutic candidates;
•
Raising additional capital through the sale of equity or convertible securities or the cash exercise of outstanding warrants may cause significant dilution to holders of our ordinary shares and ADSs, and raising additional capital through debt financings, strategic partnerships, collaborations, or other means may restrict our operations or require us to relinquish rights to therapeutic candidates;
•
Intellectual property rights of third parties could adversely affect our ability to develop or commercialize our investigational treatments, such that we could be required to litigate or obtain licenses from third parties in order to develop or market our investigational treatments. Such litigation or licenses could be costly or not available on commercially reasonable terms;
•
Our operating activities may be restricted as a result of covenants related to our Loan Agreement, which could have a material adverse effect on our business, financial condition, and results of operations;
•
COMP360 psilocybin treatment is, and any future therapeutic candidates we may develop may be, subject to controlled substance laws and regulations in the jurisdictions where our products, if approved, may be marketed, and failure to comply with these laws and regulations, or the cost of compliance with these laws and regulations, or changes in these laws and regulations may adversely affect the results of our business operations, both during clinical development and post-approval, and our financial condition;
•
Adverse publicity or public perception regarding psilocybin or our current or future investigational treatments using psilocybin, or regarding other controlled substances, may negatively influence the success of these treatments;
•
We are dependent on the successful development of our investigational COMP360 psilocybin treatment. Clinical drug development is a lengthy and expensive process with uncertain timelines and uncertain outcomes;
•
COMP360 and any future therapeutic candidates we may develop may have serious adverse, undesirable or unacceptable side effects which may delay or prevent marketing approval or adversely affect the commercial profile for the treatment;
•
Research and development of drugs targeting the central nervous system is particularly difficult, which makes it difficult to predict and understand why the drug has a positive effect on some patients but not others;
•
We have never commercialized a therapeutic candidate before and may lack the necessary expertise, personnel and resources to successfully commercialize our treatments on our own or with suitable collaborators or on an accelerated timeline;
•
The future commercial success of our investigational COMP360 psilocybin treatment will depend on the degree of market access and acceptance of our potential treatments;
•
Our business and commercialization strategy for our investigational COMP360 psilocybin treatment depends on our ability to identify, qualify, prepare, and support third-party treatment sites. If we are unable to do so, our commercialization prospects would be limited and our business would be harmed;
•
In our clinical trials, we currently rely on specially trained, licensed healthcare professionals working at third-party clinical trial sites and upon regulatory approval we expect to continue to rely on healthcare professionals working at third-party sites, to monitor and safeguard participants during administration of our COMP360 psilocybin treatment. If third-party sites fail to recruit, retain or effectively manage a sufficient number of qualified healthcare professionals, our clinical trials may be delayed and, upon regulatory approval, our ability to effectively commercialize COMP360 psilocybin treatment may be limited, and our business, financial condition and results of operations would be materially harmed;
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•
Others may claim an ownership interest in our intellectual property and our product candidates, which could expose us to litigation and have a significant adverse effect on our prospects;
•
Recently enacted and future legislation or changes in regulatory conditions may increase the difficulty and cost for us to obtain marketing approval of, adequate reimbursement for and commercialize our investigational COMP360 psilocybin treatment;
•
We rely on third parties to supply drug substances and manufacture, package and distribute COMP360 for our clinical trials, and, if approved, we will continue to rely on third parties for commercial supply. If any third-party provider fails to meet its obligations to supply drug substance or manufacture COMP360, or fails to maintain or achieve satisfactory regulatory compliance, the development of such substance and the commercialization of any treatments, if approved, could be stopped, delayed or made commercially unviable, or less profitable or may result in enforcement actions against us;
•
There are a number of third parties who conduct investigator-initiated studies, or IISs, using COMP360 provided by us. IISs of COMP360 may generate clinical trial data that raises concerns regarding the safety or effectiveness of COMP360;
•
We face substantial competition and our competitors may discover, develop or commercialize treatments before or more successfully than us, which may result in the reduction or elimination of our commercial opportunities;
•
We may face business interruptions, data loss, unauthorized access to or disclosure of personal health information or other personally identifiable information, failures or significant downtime of our information technology systems, negative publicity or reputational damage resulting from cyber-attacks on our systems or other cybersecurity incidents or data breaches; and
•
Unfavorable global economic and geopolitical conditions as well as volatility in the financial markets have in the past and could in the future adversely affect our business, financial condition or results of operations.
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PART I—FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
COMPASS PATHWAYS PLC
Condensed Consolidated Balance Sheets
(unaudited)
(in thousands, except share and per share amounts)
(expressed in U.S. Dollars, unless otherwise stated)
September 30,
December 31,
2026
2025
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
443,979
$
149,608
Restricted cash
425
379
Prepaid expenses and other current assets
43,144
41,503
Total current assets
487,548
191,490
NON-CURRENT ASSETS:
Operating lease right-of-use assets
3,454
3,424
Deferred tax assets
5,114
3,751
Long-term prepaid expenses and other assets
22,980
11,684
Total assets
$
519,096
$
210,349
LIABILITIES AND SHAREHOLDERS' EQUITY/(DEFICIT)
CURRENT LIABILITIES:
Accounts payable
$
8,988
$
15,222
Accrued expenses and other liabilities
16,970
9,214
Debt, current portion
1,425
17,523
Operating lease liabilities - current
1,803
2,110
Warrant liabilities
296,677
203,726
Total current liabilities
325,863
247,795
NON-CURRENT LIABILITIES:
Debt, non-current portion
49,561
14,110
Operating lease liabilities - non-current
1,605
1,292
Total liabilities
377,029
263,197
Commitments and contingencies (Note 9)
SHAREHOLDERS' EQUITY/(DEFICIT):
Ordinary shares, £
0.008
par value;
141,684,353
and
96,085,785
shares authorized, issued and outstanding at September 30, 2026 and December 31, 2025, respectively
1,461
973
Additional paid-in capital
1,150,543
783,562
Accumulated other comprehensive loss
(
14,920
)
(
14,789
)
Accumulated deficit
(
995,017
)
(
822,594
)
Total shareholders' equity/(deficit)
142,067
(
52,848
)
Total liabilities and shareholders' equity/(deficit)
$
519,096
$
210,349
The accompanying notes are an integral part of these condensed consolidated financial statements.
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COMPASS PATHWAYS PLC
Condensed Consolidated Statements of Operations and Comprehensive Loss
(unaudited)
(in thousands, except share and per share amounts)
(expressed in U.S. Dollars, unless otherwise stated)
Three Months Ended September 30,
Nine Months Ended September 30,
2026
2025
2026
2025
OPERATING EXPENSES:
Research and development
$
23,458
$
27,325
$
79,113
$
88,530
Selling, general and administrative
32,979
13,211
72,600
44,555
Total operating expenses
56,437
40,536
151,713
133,085
Loss from operations:
(
56,437
)
(
40,536
)
(
151,713
)
(
133,085
)
OTHER INCOME (EXPENSE), NET:
Fair value change of warrant liabilities
40,782
(
101,318
)
(
33,879
)
(
84,398
)
Interest income
3,596
1,588
9,759
5,872
Benefit from R&D tax credit
2,048
3,924
7,108
16,659
Interest expense
(
1,505
)
(
1,105
)
(
4,453
)
(
3,380
)
Foreign exchange gains (losses)
23
(
883
)
(
1,617
)
3,599
Other income
556
383
1,586
1,010
Total other income (expense), net
45,500
(
97,411
)
(
21,496
)
(
60,638
)
Loss before income taxes
(
10,937
)
(
137,947
)
(
173,209
)
(
193,723
)
Income tax benefit (expense)
1,106
230
786
(
261
)
Net loss
$
(
9,831
)
$
(
137,717
)
$
(
172,423
)
$
(
193,984
)
Net loss per share attributable to ordinary shareholders: basic
$
(
0.07
)
$
(
1.44
)
$
(
1.35
)
$
(
2.09
)
Weighted average ordinary shares outstanding: basic
138,719,375
95,337,993
128,084,630
92,646,458
Net loss per share attributable to ordinary shareholders: diluted
$
(
0.31
)
$
(
1.44
)
$
(
1.35
)
$
(
2.09
)
Weighted average ordinary shares outstanding: diluted
162,568,025
95,337,993
128,084,630
92,646,458
Net loss
$
(
9,831
)
$
(
137,717
)
$
(
172,423
)
$
(
193,984
)
Other comprehensive (loss) income:
Foreign exchange translation adjustment
(
179
)
(
605
)
(
131
)
1,007
Comprehensive loss
$
(
10,010
)
$
(
138,322
)
$
(
172,554
)
$
(
192,977
)
The accompanying notes are an integral part of these condensed consolidated financial statements.
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COMPASS PATHWAYS PLC
Condensed Consolidated Statements of Shareholders' Equity / (Deficit)
(unaudited)
(in thousands, except share and per share amounts)
(expressed in U.S. Dollars, unless otherwise stated)
ORDINARY SHARES £
0.008
ADDITIONAL PAID-IN CAPITAL
ACCUMULATED OTHER COMPREHENSIVE LOSS
ACCUMULATED DEFICIT
TOTAL SHAREHOLDERS' (DEFICIT)/EQUITY
PAR VALUE
SHARES
AMOUNT
AMOUNT
AMOUNT
AMOUNT
AMOUNT
Balance at December 31, 2025
96,085,785
$
973
$
783,562
$
(
14,789
)
$
(
822,594
)
$
(
52,848
)
Issuance of ordinary shares, net of issuance costs
17,500,000
189
131,097
—
—
131,286
Exercise of share options
6,333
1
23
—
—
24
Issuance of ordinary shares to settle vested restricted stock units
170,558
2
(
2
)
—
—
—
Issuance of ordinary shares to settle warrant exercised
21,160,619
228
153,905
—
—
154,133
Share-based compensation expense
—
—
2,896
—
—
2,896
Unrealized loss on foreign currency translation
—
—
—
(
6
)
—
(
6
)
Net income
—
—
—
—
91,202
91,202
Balance at March 31, 2026
134,923,295
1,393
1,071,481
(
14,795
)
(
731,392
)
326,687
Issuance of ordinary shares under ATM facility, net of issuance costs
108,000
1
1,396
—
—
1,397
Exercise of share options
136,883
1
1,126
—
—
1,127
Issuance of ordinary shares to settle vested restricted stock units
9,375
—
—
—
—
—
Issuance of ordinary shares under the employee share purchase plan
29,753
—
160
—
—
160
Issuance of ordinary shares to settle warrant exercised
515,000
6
5,108
—
—
5,114
Share-based compensation expense
—
—
4,027
—
—
4,027
Shares tendered for withholding taxes
—
—
(
239
)
—
—
(
239
)
Unrealized gain on foreign currency translation
—
—
—
54
—
54
Net loss
—
—
—
—
(
253,794
)
(
253,794
)
Balance at June 30, 2026
135,722,306
1,401
1,083,059
(
14,741
)
(
985,186
)
84,533
Issuance of ordinary shares under ATM facility, net of issuance costs
1,795,373
18
24,146
—
—
24,164
Exercise of share options
363,783
4
1,412
—
—
1,416
Issuance of ordinary shares to settle vested restricted stock units
18,530
—
—
—
—
—
Issuance of ordinary shares to settle warrant exercised
3,784,361
38
37,541
—
—
37,579
Share-based compensation expense
—
—
4,452
—
—
4,452
Shares tendered for withholding taxes
—
—
(
67
)
—
—
(
67
)
Unrealized loss on foreign currency translation
—
—
—
(
179
)
—
(
179
)
Net loss
—
—
—
—
(
9,831
)
(
9,831
)
Balance at September 30, 2026
141,684,353
$
1,461
$
1,150,543
$
(
14,920
)
$
(
995,017
)
$
142,067
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ORDINARY SHARES £
0.008
ADDITIONAL PAID-IN CAPITAL
ACCUMULATED OTHER COMPREHENSIVE LOSS
ACCUMULATED DEFICIT
TOTAL SHAREHOLDERS' EQUITY
PAR VALUE
SHARES
AMOUNT
AMOUNT
AMOUNT
AMOUNT
AMOUNT
Balance at December 31, 2024
68,552,215
$
702
$
704,919
$
(
16,194
)
$
(
534,732
)
$
154,695
Issuance of ordinary shares, net of issuance costs
24,014,728
233
54,583
—
—
54,816
Exercise of share options
164,422
2
—
—
—
2
Issuance of ordinary shares to settle vested restricted stock units
116,961
1
(
1
)
—
—
—
Share-based compensation expense
—
—
3,935
—
—
3,935
Unrealized loss on foreign currency translation
—
—
—
(
117
)
—
(
117
)
Net loss
—
—
—
—
(
17,864
)
(
17,864
)
Balance at March 31, 2025
92,848,326
938
763,436
(
16,311
)
(
552,596
)
195,467
Exercise of share options
682,682
7
2
—
—
9
Issuance of ordinary shares to settle vested restricted stock units
9,375
—
—
—
—
—
Issuance of ordinary shares under the employee share purchase plan
45,965
1
156
—
—
157
Share-based compensation expense
—
—
3,596
—
—
3,596
Unrealized gain on foreign currency translation
—
—
—
1,729
—
1,729
Net loss
—
—
—
—
(
38,403
)
(
38,403
)
Balance at June 30, 2025
93,586,348
946
767,190
(
14,582
)
(
590,999
)
162,555
Exercise of share options
44,121
—
—
—
—
—
Issuance of ordinary shares to settle vested restricted stock units
26,909
—
—
—
—
—
Issuance of ordinary shares to settle warrant exercised
2,344,666
27
10,124
—
—
10,151
Share-based compensation expense
—
—
3,207
—
—
3,207
Unrealized loss on foreign currency translation
—
—
—
(
605
)
—
(
605
)
Net loss
—
—
—
—
(
137,717
)
(
137,717
)
Balance at September 30, 2025
96,002,044
$
973
$
780,521
$
(
15,187
)
$
(
728,716
)
$
37,591
The accompanying notes are an integral part of these condensed consolidated financial statements.
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COMPASS PATHWAYS PLC
Condensed Consolidated Statements of Cash Flows
(unaudited)
(in thousands)
(expressed in U.S. Dollars, unless otherwise stated)
Nine Months Ended September 30,
2026
2025
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss
$
(
172,423
)
$
(
193,984
)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation
—
210
Non-cash interest expense
771
1,104
Non-cash gain (loss) on foreign currency remeasurement
73
(
682
)
Non-cash share-based compensation expense
11,375
10,738
Non-cash lease expenses
1,533
1,114
Transaction costs allocated to warrants
643
5,778
Fair value change of warrant liabilities
33,879
84,398
Changes in operating assets and liabilities
Prepaid expenses and other current assets
(
2,045
)
(
17,364
)
Deferred and prepaid tax assets
(
1,363
)
(
753
)
Other assets
(
11,572
)
2,035
Operating lease liabilities
(
1,558
)
(
1,150
)
Accounts payable
(
6,166
)
(
7,719
)
Accrued expenses and other liabilities
7,842
(
3,177
)
Net cash used in operating activities
(
139,011
)
(
119,452
)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from the issuance of ordinary shares and pre-funded warrants associated with the 2026 Offering, net of issuance costs and the 2025 Financing, net of issuance costs
140,643
140,357
Proceeds from issuance of ordinary shares under ATM facility, net of issuance costs
25,561
—
Proceeds from the exercise of ADS warrants
87,871
—
Proceeds from the exercise of PIPE warrants
42,693
Proceeds from conversion of ADS warrants into pre-funded warrants
115,333
—
Payments of tax withholdings on stock award
(
306
)
—
Proceeds from issuance of shares under the employee share purchase plan
160
157
Net proceeds from issuance of long term debt
18,582
—
Proceeds from exercise of options
2,567
11
Proceeds from issuance of pre-funded warrants associated with the 2025 Financing, net of issuance costs
1
—
Net cash provided by financing activities
433,105
140,525
Effect of exchange rate changes on cash, cash equivalents and restricted cash
323
(
227
)
Net increase in cash, cash equivalents and restricted cash
294,417
20,846
Cash, cash equivalents and restricted cash, beginning of the period
149,987
165,470
Cash, cash equivalents and restricted cash, end of the period
$
444,404
$
186,316
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The following table provides a reconciliation of the cash, cash equivalents and restricted cash balances as of each of the periods, shown above:
As of September 30,
2026
2025
Cash and cash equivalents
$
443,979
$
185,937
Restricted cash
425
379
Total cash, cash equivalents and restricted cash
$
444,404
$
186,316
The accompanying notes are an integral part of these condensed consolidated financial statements.
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COMPASS PATHWAYS PLC
Notes to Condensed Consolidated Financial Statements
(unaudited)
1. Nature of Business
Compass Pathways plc, or the Company, is a biotechnology company dedicated to unlocking urgently needed new treatment options in mental health care. The Company is developing its investigational COMP360 psilocybin treatment for patients with treatment-resistant depression, or TRD, and post-traumatic stress disorder, or PTSD.
The Company is subject to risks and uncertainties common to clinical stage companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary intellectual property and technology, compliance with government regulations and the ability to secure additional capital to fund operations. COMP360 has advanced through clinical development and the Company is in the process of submitting a rolling New Drug Application, or NDA. Receipt of regulatory approval and state and federal rescheduling under controlled substances laws remains necessary before we can proceed with commercialization. These efforts require significant amounts of capital, adequate personnel and infrastructure and extensive compliance-reporting capabilities. Even if the Company’s rolling NDA submission results in regulatory approval, it is uncertain when, if ever, the Company will realize revenue from sales. The Company has funded its operations primarily with proceeds from the sale of its ordinary shares and ADSs in public and private equity offerings, including in its offerings pursuant to its at-the-market, or ATM, offering program, and proceeds from a loan agreement with Hercules, or the Hercules Loan Agreement.
The Company has incurred recurring losses since its inception, including net losses of $
172.4
million and $
194.0
million for the nine months ended September 30, 2026 and 2025, respectively. In addition, as of September 30, 2026, the Company had an accumulated deficit of $
995.0
million. The Company expects to continue to generate operating losses until such time as we can generate revenue from sales of COMP360 or other therapeutic candidates sufficient to sustain profitability, if ever. The Company believes the cash and cash equivalents on hand as of September 30, 2026 of $
444.0
million will be sufficient to fund its operating expenses and capital expenditure requirements for at least the next twelve months from the date of issuance of these condensed consolidated financial statements
.
The future viability of the Company is dependent on its ability to raise additional capital to finance its operations. The Company’s inability to raise capital as and when needed could have a negative impact on its financial condition and ability to pursue its business strategies. There can be no assurance that the current operating plan will be achieved or that additional funding will be available on terms acceptable to the Company, or at all. The Company may raise additional capital through a combination of equity offerings, debt financings, collaborations, and other strategic transactions, including marketing, distribution or licensing arrangements. The failure of the Company to obtain sufficient funds on acceptable terms when needed could have a material adverse effect on the Company’s business, results of operations, and financial conditions.
Market volatility, geopolitical tensions or instability (including from the effects of changes in trade policy, announced or future tariff increases), geopolitical conflict (such as the war between Ukraine and Russia and conflict in the Middle East), fluctuating inflation and interest rates and the related impact on U.S., UK and global economies, the risk of an economic slowdown or recession in the U.S., significant changes in U.S. policies or regulatory environment or the disruption to U.S. government agencies or other factors could adversely impact the Company’s operations, financial results and ability to raise additional funding.
2. Summary of Significant Accounting Policies
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, or U.S. GAAP. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements as of and for the year ended December 31, 2025, and, in the opinion of management, reflect all adjustments, consisting of normal recurring adjustments, necessary for the fair statement of the Company’s financial position for the reported periods.
The results of the Company’s operations for any interim period are not necessarily indicative of the results of the Company’s operations for any other interim period or for a full fiscal year. These interim financial statements should be read in conjunction with the audited consolidated financial statements as of and for the year ended December 31, 2025, and the notes thereto, which are included in the Company’s Annual Report on Form 10-K that was filed with the SEC, on March 24, 2026. The condensed consolidated balance sheet at December 31, 2025, was derived from audited annual consolidated financial statements but does not contain all of the footnote disclosures from the annual financial statements.
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Principles of Consolidation
The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated on consolidation.
Significant Accounting Policies
The Company’s significant accounting policies are described in Note 2 of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
Use of Estimates
The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of income and expenses during the reporting periods. Significant estimates and assumptions reflected in these condensed consolidated financial statements include, but are not limited to, warrant liabilities. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ materially from those estimates.
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03 - Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, designed to improve disclosures, primarily through increased expense disaggregation. Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03. The guidance is effective for all fiscal years beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. The new standard can be adopted on a prospective basis with an option to be adopted retrospectively and early adoption is permitted. The Company is not early adopting the standard. We are currently evaluating this guidance to determine its impact on the Company’s consolidated financial statement disclosures.
3. Fair Value of Financial Assets and Liabilities
The following tables present information about the Company’s financial instruments measured at fair value on a recurring basis and indicate the level of the fair value hierarchy used to determine such fair values:
Fair Value Measurements
as of September 30, 2026
Level 1
Level 2
Level 3
Total
Assets:
Cash equivalents - money market funds
$
196,602
$
—
$
—
$
196,602
$
196,602
$
—
$
—
$
196,602
Liabilities:
Pre-funded Warrants
$
—
$
296,677
$
—
$
296,677
$
—
$
296,677
$
—
$
296,677
Fair Value Measurements
as of December 31, 2025
Level 1
Level 2
Level 3
Total
Assets:
Cash equivalents - money market funds
$
43,053
$
—
$
—
$
43,053
$
43,053
$
—
$
—
$
43,053
Liabilities:
Pre-funded Warrants
$
—
$
60,029
$
—
$
60,029
2025 ADS Warrants
—
—
143,697
143,697
$
—
$
60,029
$
143,697
$
203,726
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During the three and nine months ended September 30, 2026, there were no transfers between Level 1, Level 2 and Level 3. Excluded from the tables above, is cash held in notice accounts with maturities of less than 90 days. There was
no
such cash as of September 30, 2026, and $
60.8
million as of December 31, 2025, for which the carrying value approximates fair value due to the short-term nature.
The Pre-funded Warrants and 2025 ADS Warrants are accounted for as liabilities in accordance with ASC 815-40,
Derivatives and Hedging, Contracts in Entity’s Own Equity
(“ASC 815-40”), as both warrants contain contingent exercise provisions that do not meet the requirements of the indexation guidance under ASC 815-40 and could require the Company to pay cash to settle the warrants. The warrants are presented within warrant liabilities in the accompanying condensed consolidated balance sheets. The warrant liabilities were measured at fair value at inception and on a recurring basis, with changes in fair value presented within the condensed consolidated statements of operations and comprehensive loss.
The Pre-funded Warrants are considered to be Level 2 in the fair value hierarchy as the inputs used to determine fair market value are observable against the Company’s stock price. The 2025 ADS Warrants are considered to be Level 3 in the fair value hierarchy as they have been recorded at fair value using the Black-Scholes model, using unobservable assumptions that have been probability-weighted for specified data milestones. As of September 30, 2026, the 2025 ADS Warrants were fully exercised.
The following table reflects the fair value of the Company’s warrant liabilities for the nine months ended September 30, 2026:
Pre-Funded Warrants
ADS Warrants
Fair value as of December 31, 2025
$
60,029
$
143,697
Change in fair value of warrant liabilities
100,183
(
66,304
)
Exercise of 2025 Financing pre-funded warrant liabilities
(
33,719
)
(
32,542
)
Issuance of February 2026 Offering of pre-funded warrants
10,000
—
Conversion of 2025 Financing ADS warrants to pre-funded warrants
160,184
(
44,851
)
Fair value as of September 30, 2026
$
296,677
$
—
4. Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consisted of the following (in thousands):
September 30,
December 31,
2026
2025
UK R&D tax credit
$
15,205
$
15,387
Prepaid research and development
16,132
17,102
Prepaid income tax
3,148
3,434
Other current assets
8,659
5,580
$
43,144
$
41,503
For the years ended December 31, 2023 to 2025, the Company is uncertain whether it met the R&D intensity condition and is eligible for the enhanced effective rate due to uncertainties over whether impairments on intercompany loans and investments in subsidiary companies should be taken into account in determining the R&D intensity threshold. This matter is currently under discussion with His Majesty’s Revenue and Customs, or HMRC, and the outcome is unknown. Given the uncertainty over the outcome of the discussions with HMRC, the enhanced R&D credits as a research intensive company have not been reflected in the financial statements. If the Company reaches a successful conclusion with HMRC, additional credits of $
4.1
million in the year ended December 31, 2023, $
7.0
million in the year ended December 31, 2024 and $
7.3
million in the year ended December 31, 2025 could be claimed.
5. Debt
On June 30, 2023, the Company entered into a loan agreement with Hercules, which provided for aggregate maximum borrowings of up to $
50.0
million, including a term loan of $
30.0
million, which was funded on June 30, 2023. On January 5, 2026, or the Effective Date, the Company entered into a third amendment to the loan agreement with Hercules, or the Amended Loan Agreement. The Amended Loan Agreement provides for five tranches of term loans in an aggregate principal amount of up to $
150.0
million, consisting of (i) a term loan of $
50.0
million, which was funded on the Effective Date, (ii) term loans of up to $
30.0
million subject to achievement of a milestone relating to certain FDA approvals being granted, (iii)
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term loans of up to $
20.0
million subject to achievement of a specified commercial milestone, and (iv) term loans of up to $
20.0
million, plus the $
30.0
million that became available to us upon achievement of a specified clinical milestone and any remaining unborrowed amounts from the earlier tranches, subject to the approval of Hercules’ investment committee. If the conditions of each term loan are met, these tranches may be borrowed in drawings of a minimum of $
5.0
million each. As required by the Amended Loan Agreement, a portion of the proceeds from the Tranche 1 Advance was used to repay the outstanding principal amounts and PIK due under the second amendment to the original loan Agreement, which is approximately $
31.1
million.
Borrowings under the Amended Loan Agreement bear interest at an annual rate equal to the greater of (i)
9.75
% or (ii)
2.75
% plus the Wall Street Journal prime rate. Payments under the Amended Loan Agreement are interest only until the first principal payment is due in the first quarter of 2029, and may be deferred if the Borrowers achieve certain milestones until the scheduled maturity date on January 5, 2031. The carrying value of the Company’s outstanding debt approximates fair value, as it reflects interest rates currently available to the Company, and is classified as a Level 2 liability within the fair value hierarchy.
The Company determined that the third amendment represented a modification of debt under ASC 470-50 Debt – Modification and Extinguishment. As a result, lender fees associated with the modification were capitalized as an adjustment to the carrying amount of the debt and are being amortized over the remaining term of the instrument.
The Company incurred fees and transaction costs totaling $
3.3
million associated with the initial term loan, which are recorded as a reduction to the carrying value of the long-term debt in the condensed consolidated balance sheets. These fees included $
0.4
million of facility fees, $
0.8
million of company fees, $
0.7
million in warrants. In addition, the Company incurred $
1.4
million of end of term charges, which are recorded as a debt discount and amortized to interest expense over the term of the loan.
The Company incurred fees and transaction costs totaling $
4.2
million associated with the third amendment to the Loan Agreement, including $
0.3
million of facility fees. In addition, the Company incurred $
3.9
million of end of term charges, which are recorded as a debt discount and amortized to interest expense over the term of the loan.
The fees, transaction costs, and the end of term charges are amortized to interest expense through the maturity date using the effective interest method. The effective interest rate of the Amended Loan Agreement was
12.9
% as of September 30, 2026.
In 2023, the Company issued warrants to Hercules to purchase the Company’s Ordinary Shares equal to the quotient derived by dividing (i) the amount equal to (a)
2.5
% times (b) the aggregate principal amount of term loan advances made and funded under the Loan Agreement by (ii) the exercise price of the warrants. Upon receipt of the first term loan in June 2023,
94,222
shares became exercisable to Hercules with a fair market value of $
0.7
million.
The Amended Loan Agreement includes a financial covenant requiring us to maintain cash equal to at least fifty-five percent of the outstanding debt balance during the period commencing on October 1, 2027 (subject to adjustment if certain performance milestones are met). If the Company meets the performance milestones, the minimum cash covenant will not apply if its market capitalization is at least $
850.0
million. The Company was in compliance with all covenants of the Amended Loan Agreement as of September 30, 2026 and December 31, 2025.
Long-term debt consisted of the following (in thousands):
September 30,
December 31,
2026
2025
Term loan payable
$
50,000
$
30,000
End of term charge
5,300
1,425
Future principal payments and end of term charge
$
55,300
$
31,425
PIK interest payable
—
1,088
Unamortized debt issuance costs
(
4,314
)
(
880
)
Carrying value of long-term debt
$
50,986
$
31,633
Less: current portion
$
(
1,425
)
$
(
17,523
)
Non-current portion
$
49,561
$
14,110
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Future principal payments, including End of Term Charge, are as follows (in thousands):
December 31, 2026
$
—
December 31, 2027
1,425
December 31, 2028
—
December 31, 2029
21,674
December 31, 2030
25,975
December 31, 2031
6,226
Total
$
55,300
Interest expense associated with the Loan Agreement for the nine months ended September 30, 2026 and 2025 was $
4.5
million and $
3.4
million, respectively.
6. Shareholders’ Equity/(Deficit)
Ordinary Shares
Each ordinary share entitles the holder to one vote on all matters submitted to a vote of the Company’s shareholders. Ordinary shareholders are entitled to receive dividends, if any, as may be declared by the board of directors. Through September 30, 2026, no cash dividends had been declared or paid by the Company.
At-the-Market Facility
On October 8, 2021, the Company entered into a Sales Agreement with TD Securities (USA) LLC, or TD Cowen, under which the Company was permitted to issue and sell from time to time up to $
150.0
million of its ADSs, each representing
one
ordinary share, through TD Cowen as the sales agent. Pursuant to the Sales Agreement dated October 8, 2021, t
hrough February 27, 2025, we sold
5,491,836
ADSs under
our ATM offering program
, resulting in $
54.8
million in net proceeds.
On February 27, 2025, the Company entered into a new Sales Agreement under which the Company may issue and sell from time to time up to $
150.0
million of our ADSs, subject to the terms of the Sales Agreement. Sales of the Company’s ADSs, if any, will generally be made at market prices. During the three and nine months ended September 30, 2026, the Company sold
1,795,373
ADSs and
1,903,373
ADSs, respectively, under its ATM offering program. For the three-month period, the average price per ADS was $
13.8042
, resulting in gross proceeds of $
24.8
million and net proceeds of $
24.2
million. For the nine-month period, the average price per ADS was $
13.7736
, resulting in gross proceeds of $
26.2
million and net proceeds of $
25.6
million. As of September 30, 2026, approximately $
123.8
million remain available for future sales under the February 27, 2025 Sales Agreement.
Warrants
Equity-classified
On June 30, 2023, the Company entered into a Warrant Agreement with Hercules, which provides Hercules with the right to purchase a number of the Company’s Ordinary Shares, equal to the quotient derived by dividing (i) the amount equal to (a)
2.5
% times (b) the aggregate principal amount of term loan advances made and funded under the Loan Agreement by (ii) the exercise price. Upon receipt of each term loan, the Warrant will automatically become exercisable and will expire in
10
years (on June 30, 2033). On June 30, 2023, with the receipt of the first term loan,
94,222
shares became exercisable to Hercules with a fair market value of $
0.7
million.
On August 18, 2023, the Company entered into a Securities Purchase Agreement, pursuant to which the Company agreed to sell and issue in a private placement transaction, or a PIPE, (i)
16,076,750
ADSs, and (ii) PIPE Warrants to purchase up to
16,076,750
ADSs, at a purchase price of approximately $
7.78
per ADS ,and accompanying PIPE Warrant to purchase
one
ADS. Each PIPE Warrant has an exercise price of $
9.93
per ADS and is exercisable for a
three-year
period beginning in February 2024. The PIPE Warrants may be exercised on a cashless basis if there is no effective registration statement registering the shares underlying the PIPE Warrants. As of September 30, 2026 PIPE Warrants had been exercised for an aggregate of
8,051,411
ADSs, resulting in proceeds of $
80.0
million. During the nine-months ended September 30, 2026, PIPE Warrants were exercised for an aggregate of
4,299,361
ADSs, resulting in proceeds of $
42.7
million. The Company may receive up to an additional approximately $
79.7
million in gross proceeds if the PIPE Warrants are fully exercised for cash.
Liability-classified
On January 13, 2025, in connection with the 2025 Financing, the Company issued and sold (i)
24,014,728
ADSs, each representing
one
ordinary share, nominal value £
0.008
each, of the Company and accompanying warrants to purchase up to
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24,014,728
ADSs, and (ii) in lieu of ADSs, to certain investors, Pre-funded Warrants to purchase up to
11,044,720
ADSs and accompanying 2025 ADS Warrants to purchase up to
11,044,720
ADSs. The offering price was $
4.2750
per ADS and accompanying 2025 ADS Warrant, and $
4.2649
per Pre-funded Warrant and accompanying 2025 ADS Warrant. The Pre-funded Warrants have an exercise price of $
0.0001
per ADS and are exercisable immediately. The Pre-funded Warrants expire when exercised in full. The 2025 ADS Warrants had an exercise price of $
5.7960
per ADS.
The 2025 Financing comprised of ADSs, Pre-funded Warrants and 2025 ADS Warrants, resulted in aggregate proceeds of $
149.8
million, with issuance costs of $
9.4
million. Since the Pre-funded Warrants and 2025 ADS Warrants have been classified as a liability and recorded at fair value with changes in fair value recorded in the condensed consolidated statements of operations and comprehensive loss, the aggregate proceeds have been allocated first to these warrants at their respective fair values at the issuance date. The residual has been allocated to the ADSs issued as part of the 2025 Financing and recognized within equity.
In February 2026,
35,059,448
2025 ADS Warrants were exercised and the Company received net proceeds of $
203.2
million. Upon exercise of these outstanding warrants, the Company issued
15,160,619
ADSs and in lieu of ADSs, to certain institutional investors, Pre-funded Warrants to purchase up to
19,898,829
ADSs. During the three-months ended
March 31, 2026
,
6,000,000
Pre-funded Warrants were exercised resulting in a $
33.7
million reduction in warrant liabilities. As of
September 30, 2026
,
23,848,829
Pre-funded Warrants remain outstanding.
On February 19, 2026, the Company issued and sold in an underwritten offering, or the February 2026 Offering,
17,500,000
ADSs at a public offering price of $
8.00
per ADS, each representing
one
ordinary share, and in lieu of ADSs, to certain institutional investors, Pre-funded Warrants to purchase up to
1,250,000
ADSs at a public offering price of $
7.9999
per Pre-funded Warrant. The Company received net proceeds of approximately $
140.5
million, after deducting underwriting discounts and commissions and estimated offering costs. The Pre-funded Warrants associated with the February 2026 Offering have been classified as a liability and recorded at fair value with changes in fair value recorded in the condensed consolidated statements of operations and
comprehensive loss
.
7. Share-Based Compensation
2017 Equity Incentive Plan
Under the Company’s historical shareholder and subscription agreements, the Company was authorized to issue restricted shares, restricted share units, as well as options, as incentives to its employees, non-employees and members of its board of directors.
As of September 30, 2026, the Company was authorized to issue a total of
223,824
ordinary shares underlying outstanding options granted under the 2017 Plan prior to our initial public offering, or IPO.
2020 Employee Share Purchase Plan
The Company’s 2020 Employee Share Purchase Plan, or the ESPP, provides that the number of shares reserved and available for issuance will automatically increase each January 1, beginning on January 1, 2022 and each January 1 thereafter through termination of the ESPP, by the lesser of (i)
1
% of the outstanding number of ordinary shares on the immediately preceding December 31, (ii)
510,080
ordinary shares or (iii) such lesser number of ordinary shares as determined by the plan administrator.
2020 Share Option Plan
The Company’s 2020 Share Option and Incentive Plan, or the 2020 Plan, allows the compensation and leadership development committee to make equity-based, including options and restricted share units, and cash-based incentive awards to the Company’s officers, employees, directors and other key persons (including consultants).
The Company initially reserved
2,074,325
of its ordinary shares for the issuance of awards under the 2020 Plan. The 2020 Plan provides that the number of shares reserved and available for issuance under the plan will automatically increase each January 1, beginning on January 1, 2022, by up to
4
% of the outstanding number of ordinary shares on the immediately preceding December 31, or such lesser number of shares as determined by the Company’s compensation and leadership development committee. The total number of ordinary shares that were authorized for issuance under the 2020 Plan is
14,523,648
shares as of
September 30, 2026
, of which
3,613,099
shares remained available for future grant.
2022 Inducement Option Award
During 2022, the Company granted a non-qualified share option to purchase up to
600,000
ordinary shares as an inducement grant to our chief executive officer.
2026 Inducement Plan
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The Company’s 2026 Inducement Plan, or the Inducement Plan, allows the compensation and leadership development committee to make equity-based awards, including options and restricted share units, exclusively to individuals who were not previously employees or directors of the Company, as an inducement material to the individual’s entry into employment with the Company within the meaning of Rule 5635(c)(4) of the Marketplace Rules of the Nasdaq Stock Market, or Rule 5635(c)(4). The Inducement Plan was adopted by the Board without stockholder approval pursuant to Rule 5635(c)(4). The Company reserved
3,500,000
of its ordinary shares for the issuance of awards under the Inducement Plan, of which
2,210,240
shares remained available for future grant as of September 30, 2026.
Share-based compensation expense recorded as research and development and selling, general and administrative expenses is as follows (in thousands):
Three Months Ended September 30,
Nine Months Ended September 30,
2026
2025
2026
2025
Research and development
$
1,229
$
1,224
$
3,366
$
4,037
Selling, general and administrative
3,223
1,983
8,009
6,701
Total share-based compensation expense
$
4,452
$
3,207
$
11,375
$
10,738
8. Net Loss Per Share
The Company computes basic net loss per share by dividing net loss by the weighted-average number of ordinary shares outstanding during the period. Net loss reflects the allocation of undistributed earnings to participating securities, including certain pre-funded warrants, pursuant to the two-class method. The Company computes diluted net loss per share by dividing net loss by the weighted-average number of shares and dilutive potential share equivalents then outstanding during the period.
Considered within the weighted-average number of ordinary shares used in net loss per share for the three and nine months ended September 30, 2026 and 2025, are ADSs issuable upon the exercise of the Pre-Funded Warrants, as the Pre-Funded Warrants are exercisable at any time for nominal consideration, and as such are considered outstanding for the purpose of calculating diluted net loss per share.
The Company’s potentially dilutive securities, which include unvested ordinary shares, unvested restricted share units, options granted and equity-classified warrants, have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share.
The following table sets forth the computation of the Company’s basic and diluted net loss per share:
Three Months Ended September 30,
Nine Months Ended September 30,
(In thousands, except per share amounts)
2026
2025
2026
2025
Net loss, as reported
$
(
9,831
)
$
(
137,717
)
$
(
172,423
)
$
(
193,984
)
Adjustment for change in fair value of warrant liabilities
(
40,782
)
—
—
—
Net loss, for use in diluted loss per share
$
(
50,613
)
$
(
137,717
)
$
(
172,423
)
$
(
193,984
)
Weighted-average common shares - basic
138,719,375
95,337,993
128,084,630
92,646,458
Effect of dilutive securities:
Warrants - liability classified
23,848,650
—
—
—
Weighted-average common shares - diluted
162,568,025
95,337,993
128,084,630
92,646,458
Net loss per common share - basic
$
(
0.07
)
$
(
1.44
)
$
(
1.35
)
$
(
2.09
)
Net loss per common share - diluted
$
(
0.31
)
$
(
1.44
)
$
(
1.35
)
$
(
2.09
)
20
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The following table sets forth the potential ordinary shares excluded from the calculation of diluted net loss per share, because including them would have had an anti-dilutive effect:
Three Months Ended September 30,
Nine Months Ended September 30,
2026
2025
2026
2025
Employee share purchase plan
35,129
40,342
35,129
40,342
Unvested restricted share units
1,932,396
770,652
1,932,396
770,652
Share options
10,409,220
7,991,809
10,409,220
7,991,809
Warrants - equity-classified
8,119,561
12,418,922
8,119,561
12,418,922
Warrants - liability-classified
—
43,759,448
21,384,234
43,759,448
20,496,306
64,981,173
41,880,540
64,981,173
9. Commitments and Contingencies
Legal Proceedings
From time to time, the Company may become involved in litigation or other legal proceedings. The Company records a loss contingency accrual for a legal proceeding when it considers the potential loss probable and it can reasonably estimate the amount of the loss or determine a probable range of loss. The Company provides disclosure when it considers a loss reasonably possible or when it determines that a loss in excess of a reserve is reasonably possible. The Company provides an estimate of such reasonably possible losses or an aggregate range of such reasonably possible losses, unless the Company believes that such an estimate cannot be made. There were no material loss contingencies accrued as of September 30, 2026 or December 31, 2025.
In August 2022, Terran Biosciences, Inc., or Terran, filed a lawsuit against the Company in the U.S. District Court for the District of Maryland asserting claims of trade secret misappropriation under the federal and Maryland state law, as well as a number of state law business-related torts. The trade secret at issue is not used in the Company’s investigational COMP360 psilocybin treatment. Terran does not allege otherwise. Instead, the allegations are directed to publication of the trade secret, not use in any product by Compass. As of the fourth amended complaint entered July 11, 2025, the parties include plaintiffs Terran, the University of Maryland, Baltimore, and Professor Scott Thompson (collectively, the Plaintiffs) and defendants include the Company and two of its former officers and directors (collectively, the Defendants). The complaint sought unspecified compensatory and exemplary damages, reasonable attorneys’ fees and equitable relief, including an injunction enjoining the Company from retaining, using or disclosing the alleged trade secrets. On September 25, 2026, the court denied the Company's motion for summary judgment. The case is scheduled for trial in September 2027. The Company strongly disputes the allegations, believes it has substantial defenses to the claims and intends to defend the matter vigorously. The outcome of the litigation cannot be predicted with certainty, and the Company is unable at this time to reasonably estimate the possible loss, if any.
Indemnification
In the ordinary course of business, the Company enters into agreements that may include indemnification provisions. Pursuant to such agreements, the Company may indemnify, hold harmless and defend an indemnified party for losses suffered or incurred by the indemnified party. Some of the provisions will limit losses to those arising from third party actions. In some cases, the indemnification will continue after the termination of the agreement. The maximum potential amount of future payments the Company could be required to make under these provisions is not determinable. The Company has not incurred material costs to defend lawsuits or settle claims related to these indemnification provisions. The Company has also entered into deeds of indemnity with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers in accordance with the indemnification obligations under its Articles of Association. The Company currently has directors’ and officers’ insurance.
10. Segment Reporting
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The Company has
one
operating
segment
.
The table below is a summary of the segment loss, including significant segment expenses (in thousands):
Three Months Ended September 30,
Nine Months Ended September 30,
2026
2025
2026
2025
Operating expenses:
Research and Development:
Development expenses
$
13,382
$
17,862
$
48,836
$
61,000
Personnel expenses
6,356
6,416
19,716
18,598
Non-cash share-based compensation expense
1,229
1,224
3,366
4,037
Facilities and other expenses
1
2,491
1,823
7,195
4,895
Selling, General and Administrative:
Personnel expenses
12,944
4,780
26,916
14,459
Legal and professional fees
7,755
4,440
20,160
17,171
Facilities and other expenses
1
9,057
2,008
17,515
6,224
Non-cash share-based compensation expense
3,223
1,983
8,009
6,701
Total operating expenses
56,437
40,536
151,713
133,085
Loss from operations
(
56,437
)
(
40,536
)
(
151,713
)
(
133,085
)
Fair value change of warrant liabilities
40,782
(
101,318
)
(
33,879
)
(
84,398
)
Interest income
3,596
1,588
9,759
5,872
Benefit from R&D tax credit
2,048
3,924
7,108
16,659
Interest expense
(
1,505
)
(
1,105
)
(
4,453
)
(
3,380
)
Foreign exchange gains (losses)
23
(
883
)
(
1,617
)
3,599
Other income
556
383
1,586
1,010
Income tax benefit (expense)
1,106
230
786
(
261
)
Net loss
$
(
9,831
)
$
(
137,717
)
$
(
172,423
)
$
(
193,984
)
1
Other expenses include subscriptions and memberships, consulting fees and company insurance.
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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 in conjunction with the condensed consolidated financial statements and the related notes to those statements included earlier in this Quarterly Report on Form 10-Q. In addition to historical financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, beliefs and expectations that involve risks and uncertainties. Our actual results and the timing of events could differ materially from those discussed in these forward-looking statements. Important factors that could cause or contribute to these differences include those discussed below and elsewhere in this Quarterly Report on Form 10-Q, particularly in Part II, Item 1A. “Risk Factors” and the section titled “Special Note Regarding Forward-Looking Statements.”
References to “we,” “our,” “us” and “the Company” refer to Compass Pathways plc.
Operating Results
Overview
We are a biotechnology company dedicated to unlocking urgently needed new treatment options in mental health care. We believe mental health patients deserve the possibility of a better future. Our goal is to advance treatments that move the field of psychiatry towards treatment options that offer rapid onset and sustained durability with infrequent dosing. Our initial focus is on developing our investigational COMP360 psilocybin treatment, potentially a first-in-class treatment, for treatment-resistant depression, or TRD, which is a subset of major depressive disorder, or MDD, and post-traumatic stress disorder, or PTSD. COMP360 is our proprietary psilocybin formulation that includes our pharmaceutical-grade polymorphic crystalline psilocybin, optimized for stability and purity.
Our lead development program is in TRD, comprising patients who are inadequately served by current treatment options. In 2018, we received Breakthrough Therapy designation from the U.S. Food and Drug Administration, or the FDA for COMP360 for the treatment of TRD. In November 2021, we announced positive top-line results from our Phase 2b clinical trial evaluating COMP360 for the treatment of TRD. On November 3, 2022, The New England Journal of Medicine published the positive results from our Phase 2b trial. At the time of its completion, this was the largest, randomized, controlled, double-blind psilocybin treatment clinical trial. The objective of the Phase 2b study was to evaluate the efficacy and safety of a single dose of investigational COMP360 psilocybin (25mg or 10mg), compared to 1mg, in patients with TRD. The trial achieved its primary endpoint for the 25mg dose, with a 25mg dose of COMP360 demonstrating a statistically significant and clinically relevant treatment difference against the 1mg dose of COMP360 in reducing depressive symptom severity after three weeks.
In 2025, we completed enrollment for each of the two pivotal trials in our Phase 3 program evaluating our COMP360 psilocybin treatment in TRD. Each of the two pivotal trials has a long-term follow-up component. The pivotal program design is as follows:
• COMP005 Pivotal trial (n=258): a single dose (25mg) monotherapy compared with placebo.
• COMP006 Pivotal trial (n= 581): a fixed repeat dose monotherapy using three dose arms: 25mg, 10mg and 1mg. This trial is designed to investigate whether a second dose can increase therapeutic response.
• The primary endpoint in both pivotal trials is the change from baseline in the Montgomery-Åsberg Depression Rating Scale, or MADRS, total score at week 6.
In June 2025, we reported that the first pivotal trial, the COMP005 trial, achieved its primary endpoint, with a single 25mg dose of COMP360 versus placebo demonstrating a highly statistically significant reduction in symptom severity as measured by MADRS with a p-value of p<0.001 and a clinically meaningful difference of -3.6 in change at six weeks. The COMP005 trial was comprised of three parts: Part A, which concluded during the second quarter of 2025, and was blinded through 6 weeks; Part B, which remained blinded through week 26; and Part C, which contained an open-label treatment part from week 26 to 52.
In February 2026, we announced the successful achievement of the primary endpoint in our Phase 3 COMP006 trial and Part B results from our Phase 3 COMP005 trial. We reported that the COMP006 trial achieved its primary endpoint with two fixed doses, administered 3 weeks apart, of COMP360 25 mg versus 1 mg demonstrating a highly statistically significant reduction in symptom severity with a p-value of <0.001 and a clinically meaningful difference of -3.8 points in change at six weeks.
Following these data read-outs and discussions with the FDA, the FDA granted our request for a rolling review of our NDA, which is ongoing. In April 2026, the FDA issued a
National Priority Voucher for COMP360 psilocybin treatment in TRD.
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In July 2026, we announced Part B results from our Phase 3 COMP006 trial, which confirm COMP360’s rapid onset and durable profile. The 26-week findings from our Phase 3 COMP006 trial build on previously reported results from our Phase 3 COMP005 trial, which demonstrated rapid onset and durable response to at least 6 months, with a generally well-tolerated and safe profile in people living with TRD.
In September 2026, we announced Part C results from our Phase 3 COMP005 trial. The open-label Part C data demonstrate the following: (i) notable additional benefit was observed with an added reduction in MADRS score leading to an average 13-point reduction from baseline at week 52 and extended out to 1 year for participants who were randomized to the 25 mg arm and received an additional dose in Part C; (ii) for participants in the Placebo arm who received their first dose of COMP360 25 mg in Part C, these findings further reinforce that a single dose of 25 mg has the potential to produce rapid onset, meaningful effect and durability; (iii) for all participants in Part C who received a 25 mg dose, strong response and remission rates were observed with 40%-45% responders and approximately 30% remitters across all timepoints in the 6 weeks post the Part C dose; and (iv) the COMP360 safety profile in Part C is consistent with Parts A and B and continues to show a generally well-tolerated and safe profile with no new safety findings.
Beyond TRD, we have been exploring other indications, including PTSD. In May 2024, we completed and announced top-line results from our open label Phase 2 study to assess the safety and tolerability of COMP360 psilocybin treatment in participants with PTSD, as a result of trauma experienced as adults. In line with the study design, the study enrolled 22 participants who were monitored for a 12-week period post dosing. The study met its primary safety endpoint and available secondary efficacy endpoints. Study observations included meaningful and sustained symptom improvement from baseline in mean CAPS-5 total score, a measure of disease severity, and in Sheehan Disability Scale, or SDS, score, a measure of functional impairment in daily life. Administration of COMP360 was well-tolerated, with a safety profile consistent with previous studies of COMP360. In September 2025, the results of this study were published in the Journal of Psychopharmacology.
Based on the data from this trial, we determined to advance development of COMP360 for PTSD and finalized the design of a Phase 2b/3 clinical trial in PTSD. In January 2026, the FDA accepted our IND application for COMP360 in PTSD, enabling the initiation of a Phase 2b/3 (COMP202) clinical trial in patients living with PTSD.
Since our formation, we have devoted substantially all of our resources to conducting nonclinical studies and clinical trials, organizing and staffing our company, business planning, raising capital and establishing our intellectual property portfolio. We do not have any therapeutic candidates approved for sale and have not generated any revenue. We have funded our operations primarily with proceeds from the sale of our ordinary shares and ADSs in public and private equity offerings, including in our offerings pursuant to our at-the-market, or ATM, offering program, and proceeds from a loan agreement with Hercules, or the Hercules Loan Agreement.
We have incurred recurring operating losses since our inception. While we reported net income in certain periods, those results were attributable to non-recurring, non-cash items rather than ongoing operations. For the nine months ended September 30, 2026 and 2025, we recognized net losses of $172.4 million and $194.0 million, respectively. In addition, as of September 30, 2026, we had an accumulated deficit of $995.0 million. Our historical losses have resulted principally from costs incurred in connection with research and development activities and selling, general and administrative costs associated with our operations. In the future, we intend to continue to conduct research and development, nonclinical testing, clinical trials, regulatory compliance, market access and commercialization activities that, together with anticipated selling, general and administrative expenses, will result in incurring further significant losses until such time as we can generate revenue from sales of COMP360 or other therapeutic candidates sufficient to sustain profitability, if ever. Our operating losses stem primarily from the development of our investigational COMP360 psilocybin treatment for TRD, and we expect they will continue to increase as we complete our rolling NDA submission and prepare for a potential commercial launch, among other activities. In addition, our spending in the future may also increase as we advance our Phase 2b/3 clinical trial in PTSD, or if we choose to expand into additional indications, or initiate the development for different therapeutic candidates. Furthermore, since the completion of our IPO, we have incurred, and expect to continue to incur, significant costs associated with operating as a public company, including significant legal, accounting, investor relations and other expenses.
As a result, we will need additional funding in the longer term to support our continuing operations and pursue our growth strategy. Until such time as we can generate significant revenue from sales of COMP360 or other therapeutic candidates, if ever, we expect to
finance our operations through a combination of equity offerings, debt financings, government or other third-party funding, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements.
As of
September 30, 2026
, we had cash and cash equivalents of
$444.0 million
. We believe that our existing cash and cash equivalents will be sufficient for us to fund our operating expenses and capital expenditure requirements
into 2028
.
We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. See “—Liquidity and Capital Resources—Funding Requirements” below.
Macroeconomic Conditions and Changes in Regulatory Landscape
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We continue to monitor current macroeconomic and geopolitical events, including, among others, financial and economic conditions (such as fluctuating inflation and interest rates, and fluctuations in foreign exchange rates) and the risk of an economic slowdown or recession in the U.S., significant changes in U.S. policies or regulatory environment or disruption to U.S. government agencies, and significant changes in geopolitics and international tensions (such as from the effects from changes in trade policy, announced or future tariff increases, the war between Ukraine and Russia and conflict in the Middle East), for any potential impact that these or other events or conditions may have on our business.
Changes in policy or resources of governmental agencies, including, but not limited to, changes at the FDA, DEA, SEC, IRS and U.S. Patent and Trademark Office, could impact our business and results of operations. Despite Executive Order 14401, “Accelerating Medical Treatments for Serious Mental Illness,” issued on April 18, 2026, which seeks to expedite research, regulatory review, and patient access to psychedelic therapies for serious mental health conditions, the Trump administration could issue or promulgate executive orders, regulations, policies or guidance that adversely affect us or create a more challenging or costly environment to pursue the development of our current product or future products. Alternatively, state governments may attempt to address or react to changes at the federal level with changes to their own regulatory frameworks in a manner that is adverse to our operations. In addition, the ability of the DEA to inspect clinical trial sites and issue controlled substance licenses to our clinical trial sites in a timely manner and the ability of the FDA to review and clear or approve new products has in the past and may in the future be affected by changes in government budget and funding levels, the ability of the government to hire and retain key personnel, and shifting policy priorities. If we become negatively impacted by future governmental orders, regulations, policies or guidance or a prolonged government shutdown, there could be a material adverse effect on us and our business.
Our ability to raise additional funds may be adversely impacted by macroeconomic conditions and geopolitical events, changing regulatory conditions, including potential impacts of regulatory agency staffing cuts and policy changes on regulatory feedback and timing thereof, and disruptions to and volatility in the credit and financial markets in the U.S. and worldwide. Failure to raise capital or secure other funding as and when needed could have a negative impact on our financial condition and ability to pursue our business strategies. There can be no assurances, however, that our current operating plan will be achieved or that additional funding will be available on terms acceptable to us, or at all.
Components of Our Results of Operations
Revenue
To date, we have not generated any revenue and do not expect to generate any revenue from the sale of therapeutic candidates until we can obtain regulatory approval and we can commercialize COMP360. If our development efforts for our investigational COMP360 psilocybin treatment are successful and result in regulatory approval of COMP360, we may generate revenue in the future.
Operating Expenses
Research and Development
Research and development activities are central to our business model. Product or therapeutic candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials and related product manufacturing expenses. Having completed clinical development of our investigational COMP360 psilocybin treatment for TRD, we expect expenses associated with our TRD program to decrease, whilst regulatory expenses associated with our rolling NDA submission are expected to increase. We expect expenses associated with our PTSD program to increase as we advance our Phase 2b/3 clinical trial of COMP360 in PTSD. As a result, the level and mix of our research and development expenses may vary as our programs progress through clinical development and regulatory review.
The successful development and commercialization of our investigational COMP360 psilocybin treatment is highly uncertain. This is due to the numerous risks and uncertainties associated with development and commercialization, including the following:
•
successful completion of our rolling NDA submission in TRD and successful enrollment in and completion of our Phase 2b/3 trial in PTSD and future clinical trials;
•
sufficiency of our financial and other resources to complete the necessary nonclinical studies and clinical trials, including our Phase 3 clinical trials in TRD, and our ability to raise capital on favorable terms or at all;
•
receiving regulatory approvals or clearance for conducting our planned clinical trials or future clinical trials;
•
receiving positive data from our clinical trials that support an acceptable risk-benefit profile of COMP360 psilocybin treatment and any future therapeutic candidates in the intended patient populations;
•
receipt and maintenance of regulatory and marketing approvals from applicable regulatory authorities;
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Table of Contents
•
establishing and scaling up, through third-party manufacturers, manufacturing capabilities of clinical supply for our clinical trials and commercial manufacturing, if any therapeutic candidates are approved;
•
entry into collaborations to further the development of our investigational COMP360 psilocybin treatment and our future therapeutic candidates;
•
obtaining and maintaining patent and trade secret protection or regulatory exclusivity for COMP360 and any future therapeutic candidates;
•
successfully launching commercial sales of our investigational COMP360 psilocybin treatment and any future therapeutic candidates, if approved;
•
acceptance of our current and future therapeutic candidates’ benefits and uses, if approved, by patients, the medical community and third-party payors; and
•
maintaining a continued acceptable safety profile of our investigational COMP360 psilocybin treatment and our future therapeutic candidates following approval.
A change in the outcome of any of these variables, amongst others, with respect to the development of our investigational COMP360 psilocybin treatment in nonclinical and clinical development could mean a significant change in the costs and timing associated with the development of our investigational COMP360 psilocybin treatment. For example, if the FDA, the European Medicines Agency, or EMA, the European Commission, or the EC, the Medicines and Healthcare products Regulatory Agency, or MHRA, or another regulatory authority were to require us to conduct clinical trials or other testing beyond those that we currently expect, or if we experience additional significant delays in enrollment in any of our planned clinical trials, we could be required to commit significant additional financial resources and time on the completion of clinical development of that therapeutic candidate.
Selling, General and Administrative
We anticipate we will continue to incur significant accounting, audit, legal, regulatory and compliance costs, as well as investor and public relations expenses associated with being a public company. We have also incurred, and expect to continue to incur, significant pre-commercialization expenses as we prepare for the potential commercialization of COMP360, including investments in personnel and planned sales and marketing activities. Subject to FDA approval, we expect these expenses to increase further as we build the capabilities and infrastructure necessary to support potential commercial operations.
Other Income, Net
Benefit from Research and Development Tax Credit
Benefit from R&D tax credit consists of the R&D tax credit received in the UK, which is recorded within other income, net. As a company that carries out extensive research and development activities, we have historically benefited from the Small and Medium sized Enterprise, or SME, Program and from January 1, 2025, the new merged regime. Qualifying expenditures largely comprise employment costs for research staff, consumables, a proportion of relevant, permitted sub-contract costs and certain internal overhead costs.
Based on criteria established by His Majesty’s Revenue and Customs, or HMRC, a portion of expenditures being recognized in relation to our pipeline research and development, clinical trial management and third-party manufacturing development activities was eligible under the new merged regime for the three and nine months ended September 30, 2026 and 2025. Restrictions have also been introduced on relief that may be claimed for expenditure on contracted out R&D activity where the work is undertaken outside the UK, save for certain exceptions. These restrictions and the application of the exceptions have been taken into account in the assessment of qualifying expenditure. We expect such elements to be eligible for R&D incentives in the future although there may be some limitations on expenditure on activities undertaken outside the UK.
The UK R&D tax credit is fully refundable to us and is not dependent on current or future taxable income. As a result, we have recorded the entire benefit from the UK R&D tax credit as a benefit which is included in our net loss before income tax and, accordingly, not reflected as part of the income tax provision. If, in the future, any UK R&D tax credits generated are needed to offset a corporation tax liability in the UK, that portion would be recorded as a benefit within the income tax provision and any refundable portion not dependent on taxable income would continue to be recorded within other income, net.
Interest income
Interest income relates to interest earned on cash and cash equivalents.
Interest expense
26
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Interest expense relates to interest paid on debt.
Fair value changes of warrant liabilities
The fair value changes in warrant liabilities are attributable to the warrant liabilities which are subject to re-measurement at each balance sheet date until the warrants are exercised or expire, and any change in fair value will be recognized in the condensed consolidated statements of operations and comprehensive loss.
Foreign exchange gains (losses)
Foreign exchange gains (losses) consist of foreign exchange impacts arising from foreign currency transactions, primarily related to the translation of intercompany balances, as well as bank balances held in a foreign currency.
Corporate Income Tax Expense
We are subject to corporate taxation in the U.S. and the UK (known as corporation tax in the UK). Due to the nature of our business, we have generated losses since inception and have therefore not been required to pay UK corporation tax. Our corporate income tax expense represents only income taxes in the U.S.
UK losses not surrendered may be carried forward indefinitely and may be offset against future taxable profits, subject to numerous utilization criteria and restrictions. The amount that can be offset each year is limited to £5.0 million plus an incremental 50% of UK taxable profits. After accounting for tax credits receivable, we had accumulated trading losses for carry forward in the UK of $577.9 million and $280.8 million as of December 31, 2025 and 2024, respectively, which is offset by a full valuation allowance.
During the nine months ended September 30, 2026 and 2025, we recorded a tax benefit of $0.8 million and a tax provision of $0.3 million, respectively, related to the corporate income tax obligations of our operating company in the U.S., which generates a profit for tax purposes.
Results of Operations
Comparison for the Three and Nine months ended September 30, 2026
and 2025
The following table summarizes our results of operations (in thousands):
Three Months Ended September 30,
Nine Months Ended September 30,
2026
2025
Change
2026
2025
Change
OPERATING EXPENSES:
Research and development
$
23,458
$
27,325
$
(3,867)
$
79,113
$
88,530
$
(9,417)
Selling, general and administrative
32,979
13,211
19,768
72,600
44,555
28,045
Total operating expenses
56,437
40,536
15,901
151,713
133,085
18,628
Loss from operations
(56,437)
(40,536)
(15,901)
(151,713)
(133,085)
(18,628)
OTHER INCOME (EXPENSE), NET:
Fair value change of warrant liabilities
40,782
(101,318)
142,100
(33,879)
(84,398)
50,519
Benefit from R&D tax credit
2,048
3,924
(1,876)
7,108
16,659
(9,551)
Interest income
3,596
1,588
2,008
9,759
5,872
3,887
Interest expense
(1,505)
(1,105)
(400)
(4,453)
(3,380)
(1,073)
Foreign exchange gains (losses)
23
(883)
906
(1,617)
3,599
(5,216)
Other income
556
383
173
1,586
1,010
576
Total other income (expense), net
45,500
(97,411)
142,911
(21,496)
(60,638)
39,142
Loss before income taxes
(10,937)
(137,947)
127,010
(173,209)
(193,723)
20,514
Income tax benefit (expense)
1,106
230
876
786
(261)
1,047
Net loss
$
(9,831)
$
(137,717)
$
127,886
$
(172,423)
$
(193,984)
$
21,561
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Research and Development
Research and development expenses consist of the following (in thousands):
Three Months Ended September 30,
Nine Months Ended September 30,
2026
2025
Change
2026
2025
Change
Development expenses
$
13,382
$
17,862
$
(4,480)
$
48,836
$
61,000
$
(12,164)
Personnel expenses
6,356
6,416
(60)
19,716
18,598
1,118
Facilities and other expenses
2,491
1,823
668
7,195
4,895
2,300
Non-cash share-based compensation expense
1,229
1,224
5
3,366
4,037
(671)
Total research and development expenses
$
23,458
$
27,325
$
(3,867)
$
79,113
$
88,530
$
(9,417)
For the
three and nine months ended September 30, 2026
, the decrease in research and development expenses, as compared to the same periods in
2025
, was primarily attributable to the following:
•
a decrease in development expenses primarily due to lower clinical trial expenses following completion of our
Phase 3 program for COMP360 psilocybin treatment in TRD
, as well as reduced discovery program expenses following the termination of certain programs in connection with the reorganization that took place in the fourth quarter of 2024 and the termination of related contracts in 2025.
Offset by:
•
an increase in facilities and other expenses primarily due to an increase in external consulting fees and contractors.
Notwithstanding recent declines in R&D expenses, we expect to incur significant research and development costs as we advance our Phase 2b/3 clinical trial of COMP360 psilocybin treatment in PTSD, as well as costs related to regulatory activities for COMP360 in TRD following completion of our Phase 3 program.
Selling, General and Administrative
Selling, general and administrative expenses consist of the following (in thousands):
Three Months Ended September 30,
Nine Months Ended September 30,
2026
2025
Change
2026
2025
Change
Personnel expenses
$
12,944
$
4,780
$
8,164
$
26,916
$
14,459
$
12,457
Facilities and other expenses
9,057
2,008
7,049
17,515
6,224
11,291
Legal and professional fees
7,755
4,440
3,315
20,160
17,171
2,989
Non-cash share-based compensation expense
3,223
1,983
1,240
8,009
6,701
1,308
Total selling, general and administrative expenses
$
32,979
$
13,211
$
19,768
$
72,600
$
44,555
$
28,045
For the three and nine
months ended September 30, 2026, the increase in selling, general and administrative expenses, as compared to the same periods in 2025, was primarily attributable to commercial readiness activities in advance of potential FDA approval and commercialization of COMP360 for TRD, including investments in commercial infrastructure, market access and reimbursement capabilities, supply chain readiness and other launch preparation activities, as follows:
•
an increase in personnel and non-cash share-based compensation expenses as a result of increasing staffing levels to support our commercial preparedness activities;
•
an increase in facilities and other expense primarily due to an increase in external consulting fees, contractors, and technology infrastructure and software costs supporting commercial preparedness activities; and
•
an increase in legal and professional fees as a result of increased costs associated with consulting services to support our commercial preparedness activities.
We expect to continue to incur significant selling, general and administrative expenses as a result of ongoing requirements as a public company, in addition to ongoing selling, general and administrative support for research and development activities, as well as commercial preparedness activities.We have also incurred significant pre-commercialization expenses as we prepare for the potential commercialization of COMP360 and expect these expenses to increase as we expand our commercial capabilities and advance our launch preparation activities.
Other Income (Expense), Net
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Other income (expense), net consists of the following (in thousands):
Three Months Ended September 30,
Nine Months Ended September 30,
2026
2025
Change
2026
2025
Change
Fair value change of warrant liabilities
$
40,782
$
(101,318)
$
142,100
$
(33,879)
$
(84,398)
$
50,519
Interest income
3,596
1,588
2,008
9,759
5,872
3,887
Benefit from R&D tax credit
2,048
3,924
(1,876)
7,108
16,659
(9,551)
Interest expense
(1,505)
(1,105)
(400)
(4,453)
(3,380)
(1,073)
Foreign exchange gains (losses)
23
(883)
906
(1,617)
3,599
(5,216)
Other income
556
383
173
1,586
1,010
576
Total other income (expense), net
$
45,500
$
(97,411)
$
142,911
$
(21,496)
$
(60,638)
$
39,142
For the three and nine months ended September 30, 2026, the increase in other income (expense), net as compared to the same periods in 2025, was primarily attributable to the following:
•
the change in fair value of the warrant liabilities, primarily driven by the issuance of pre-funded warrants in connection with the February 2026 Offering, the impact of the exercise of all the outstanding warrants issued in the January 2025 Financing, with a portion of such warrants exercised for Pre-funded warrants, and stock price appreciation during the period; and
•
an increase in interest income primarily due to interest earned on higher cash deposit levels.
Partially offset by:
•
a decrease in the benefit from R&D tax credit due to the prior year being recorded at the enhanced effective rates. The current year benefit is recorded at the non-enhanced rate due to uncertainty regarding satisfaction of the R&D intensity condition and eligibility for the enhanced effective rates, which is currently under discussion with HMRC; and
•
a decrease due to foreign exchange losses following remeasurement of foreign currency denominated assets and liabilities.
Liquidity and Capital Resources
We are a clinical-stage biotechnology company and we have not yet generated any revenue to date. We have incurred significant operating losses since our formation. We have not yet commercialized any therapeutic candidates. We currently expect that, if we receive marketing approval from the FDA for our first product candidate and are able to successfully launch and commercialize such product, we could begin generating revenue from product sales as early as next year. However, there can be no assurance as to the timing of any such approval, the success of any commercial launch, the level of market acceptance, or whether we will generate revenue on that timeline, if at all.
We have primarily funded our operations with proceeds from the sale of our ordinary shares, ADSs, including our ATM offering program, proceeds from the Hercules Loan Agreement, proceeds from the PIPE, proceeds from the 2025 Financing and proceeds from the February 2026 Offering.
On February 27, 2025, we entered into a new Sales Agreement under which we may issue and sell from time to time up to $150.0 million of our ADSs, subject to the terms of the Sales Agreement. Sales of our ADSs, if any, will generally be made at market prices. Pursuant to the Sales Agreement dated February 27, 2025, through September 30, 2026, we sold 1,903,373 ADSs under the ATM offering program, resulting in $25.6 million in net proceeds.
The Hercules Loan Agreement
provided for aggregate maximum borrowings of up to $50.0 million, of which we have funded $30.0 million. On January 5, 2026, we entered into a third amendment to the Loan Agreement with Hercules. The Loan Agreement provides for five tranches of term loans in an aggregate principal amount of up to $150.0 million, including a term loan of $50.0 million, which was funded on January 5, 2026.
Within the PIPE agreement, we agreed to sell and issue
PIPE Warrants to purchase up to 16,076,750 ADSs. Each PIPE Warrant has an exercise price of $9.93 per ADS and is exercisable for a three-year period beginning in February 2024. As of September 30, 2026, PIPE Warrants had been exercised for an aggregate of 8,051,411 ADSs, resulting in proceeds of $80.0 million. We may receive up to an additional approximately $79.7 million in gross proceeds if the PIPE Warrants are fully exercised for cash.
In January 2025, we completed the 2025 Financing in which we issued and sold ADSs and, in lieu of ADSs, Pre-funded Warrants to certain investors along with accompanying 2025 ADS Warrants to purchase ADSs. The 2025 ADS Warrants had an exercise price of $5.7960 per ADS.
In February 2026, all 35,059,448 2025 ADS warrants were exercised and we received
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net proceeds of $203.2 million. Upon exercise of these outstanding warrants, we issued 15,160,619 ADSs and in lieu of ADSs, to certain institutional investors, Pre-funded Warrants to purchase up to 19,898,829 ADSs.
In February 2026, we completed the February 2026 Offering, in which we issued and sold 17,500,000 ADSs at a public offering price of $8.00 per ADS, each representing one ordinary share, and in lieu of ADSs, to certain institutional investors, Pre-funded Warrants to purchase up to 1,250,000 ADSs at a public offering price of $7.9999 per Pre-funded Warrant. We received net proceeds of approximately $140.5 million, after deducting underwriting discounts and commissions and estimated offering costs.
We currently have no ongoing material financing commitments, such as lines of credit or guarantees, that are expected to affect our liquidity over the next five years, other than our operating leases, and debt obligations under our Loan Agreement with Hercules described in the notes to our condensed consolidated financial statements.
Cash Flows
The following table summarizes our cash flows for each of the periods (in thousands):
Nine Months Ended September 30,
2026
2025
Change
Net cash used in operating activities
$
(139,011)
$
(119,452)
$
(19,559)
Net cash provided by financing activities
433,105
140,525
292,580
Effect of exchange rate changes on cash, cash equivalents and restricted cash
323
(227)
550
Net increase in cash, cash equivalents and restricted cash
$
294,417
$
20,846
$
273,571
Net Cash Used in Operating Activities
Net cash used in operating activities
increas
ed during the nine months ended September 30, 2026, compared to the same period in 2025, primarily due to a $54.4 million decrease in non-cash adjustments, including the gain on change in fair value of warrant liabilities of $50.5 million, partially offset by favorable working capital related activities of $13.3 million and a $21.6 million decrease in our net loss.
Net Cash Provided by Financing Activities
Net cash provided by financing activities increased during the nine months ended September 30, 2026, compared to the same period in 2025, primarily as a result of aggregate net proceeds of $433.1 million from the February 2026 Offering for the issuance of ADSs and Pre-funded warrants, the exercise of the ADS Warrants from the 2025 Financing, from the issuance of debt, from the exercise of the PIPE Warrants and from the issuance of ADSs under the ATM facility; partially offset by the proceeds from the January 2025 Financing for the issuance of ADSs and the Pre-funded Warrants of $140.4 million in 2025.
Funding Requirements
We expect to continue to incur significant expenses in connection with our ongoing activities, particularly as we complete our rolling NDA submission for COMP360 in TRD and undertake related regulatory activities, advance our Phase 2b/3 clinical trial in PTSD and supporting clinical and nonclinical studies, and continue our manufacturing activities. We are also incurring, and expect to continue to incur, significant pre-commercialization expenses as we prepare for the potential commercialization of COMP360, including investments in personnel and commercial capabilities. In addition, we expect to continue to incur significant costs associated with operating as a public company, including significant legal, accounting, investor relations and other expenses. Our expenses are expected to increase as we:
•
complete our rolling NDA submission
;
•
prepare for commercial launch of COMP360 psilocybin treatment in TRD, if approved, including establishing a sales, marketing and distribution infrastructure and scaling-up manufacturing capabilities;
•
advance our commercialization strategy;
•
advance our Phase 2b/3 clinical trial in PTSD;
•
continue the training of qualified healthcare professionals to monitor and safeguard participants in our clinical trials;
•
service our outstanding indebtedness;
•
may in the future resume and pursue research and development programs for our other nonclinical stage therapeutic candidates and discovery-stage programs and/or develop and seek regulatory approval for any future therapeutic candidates that successfully complete clinical trials;
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•
establish and expand the number of public healthcare institutions and private clinics that could administer our investigational COMP360 psilocybin treatment if approved;
•
experience potential heightened regulatory scrutiny;
•
pursue necessary scheduling-related decisions by the U.S. Drug Enforcement Administration, or the DEA, and various state governments to enable us to commercialize any therapeutic candidates containing controlled substances for which we may obtain regulatory approval, including COMP360;
•
obtain, maintain, expand and protect our intellectual property portfolio, including litigation costs associated with defending against alleged patent or other intellectual property infringement claims;
•
add clinical, scientific, operational, financial and management information systems and personnel, including personnel to support our therapeutic development and potential future commercialization efforts;
•
experience any delays or encounter any issues with respect to any of the above, including failed studies, ambiguous trial results, safety issues or other regulatory challenges, including, for example, delays and other impacts as a result of pandemics or other public health crises;
•
expand our operations in the U.S. and Europe in the future; and
•
incur additional legal, accounting and other expenses associated with operating as an English-domiciled public company listed in the U.S.
As of
September 30, 2026
, we had cash and cash equivalents of
$444.0 million
. We believe that our existing cash and cash equivalents will be sufficient for us to fund our operating expenses and capital expenditure requirements
into 2028
.
We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect. As we progress with our development programs and the regulatory review process, we expect to incur significant commercialization expenses related to product manufacturing, pre-commercial activities and commercialization.
Because of the numerous risks and uncertainties associated with research, development and commercialization of therapeutic candidates and programs, we are unable to estimate the exact amount of our working capital requirements. Our future funding requirements will depend on and could increase significantly as a result of many factors, including:
•
the progress, timing and completion of our rolling NDA submission and potential commercialization activities;
•
the progress, timing and completion of our Phase 2b/3 clinical trial in PTSD;
•
the outcome, timing and cost of seeking and obtaining regulatory approvals from the FDA, the EC, the MHRA and comparable foreign regulatory authorities, including the potential for such authorities to require that we perform more nonclinical studies or clinical trials than those that we currently expect or change their requirements on studies that had previously been agreed to;
•
the outcome and timing of any scheduling-related decisions by the DEA, individual states, and comparable foreign authorities;
•
the number of potential future therapeutic candidates we may choose to pursue and identify in the future and decide to develop, either internally through our research and development efforts or externally through acquisitions, licensing or other collaboration agreements;
•
the costs involved in growing our organization in the near term to the size needed to prepare for the potential commercialization of our investigational COMP360 psilocybin treatment in TRD and any future therapeutic candidates, including increases to personnel costs;
•
the costs of developing sales and marketing capabilities to prepare for potential commercial launch of COMP360 psilocybin treatment in TRD to target public and private healthcare providers and clinic networks in the U.S. and other major markets;
•
the costs of training qualified healthcare professionals to monitor and safeguard participants in our clinical trials;
•
the costs of maintaining research collaborations, such as the Center for Mental Health Research, which includes conducting clinical trials, including proof of concept studies, to refine our treatment delivery model;
•
the time and costs involved in generating and collecting data and advancing and defending our intellectual property portfolio, including the costs involved in filing patent applications and maintaining and enforcing patents or defending against claims of infringements or invalidity raised by third parties;
•
the costs of developing, testing and deploying technology solutions or paying a third-party to provide such digital technology solutions for use in the conduct of our clinical trials;
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•
the time and costs involved in obtaining regulatory approval for COMP360 or any future therapeutic candidates, and any delays we may encounter as a result of evolving regulatory requirements or adverse results with respect to COMP360 or any future therapeutic candidates;
•
selling and marketing activities undertaken in connection with the potential commercialization of our investigational COMP360 psilocybin treatment or any future therapeutic candidates, if approved, and costs involved in the creation of an effective sales and marketing organization;
•
the amount of revenue, if any, we may derive either directly or in the form of royalty, milestone or other payments from future sales of our investigational COMP360 psilocybin treatment and any future therapeutic candidates, if approved;
•
the impact of macroeconomic and geopolitical events, including, among others, fluctuating inflation and interest rates, fluctuations in foreign exchange rates, the risk of economic slowdown or recession in the U.S., international tensions and changes in legislation and governmental policies and resources, including the effects of announced or future tariff increases; and
•
the costs of operating as a public company.
Until such time, if ever, that we can generate product revenue sufficient to achieve profitability, we expect to finance our cash needs through equity offerings, debt financings, government or other third-party funding, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements. Additional financing may not be available at all or on acceptable terms. To the extent that we raise additional capital through the sale of equity or exercise of outstanding warrants, current ownership interests will be diluted. If we raise additional funds through government or third-party funding, collaboration agreements, strategic alliances, licensing arrangements or marketing and distribution arrangements, we may have to relinquish future revenue streams, research programs or therapeutic candidates or grant licenses on terms that may not be favorable to us. Debt financing, if available, may involve high interest rates or agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we are unable to raise additional funds when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market products or therapeutic candidates that we would otherwise prefer to develop and market ourselves.
Critical Accounting Policies and Significant Judgments and Estimates
Our critical accounting policies and significant judgments and estimates are described in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of our Annual Report on Form 10-K for the year ended December 31, 2025, which we filed with the SEC on March 24, 2026. There have been no significant changes to our critical accounting policies since the beginning of this fiscal year.
Smaller Reporting Company Status
We are a “smaller reporting company” as defined in the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we may take advantage of certain of the scaled disclosures available to smaller reporting companies. These include, but are not limited to, reduced disclosure obligations regarding executive compensation and an exemption from the requirement to provide a compensation discussion and analysis describing compensation practices and procedures. As a smaller reporting company with annual revenues of less than $100.0 million and a non-accelerated filer, we are also not required to provide an attestation report on internal control over financial reporting issued by our independent registered public accounting firm. We will be able to take advantage of these scaled disclosures and exemptions for so long as (i) our voting and non-voting shares held by non-affiliates is less than $250.0 million measured on the last business day of our most recent second fiscal quarter or (ii) our annual revenue is less than $100.0 million during the most recently completed fiscal year and our voting and non-voting shares held by non-affiliates is less than $700.0 million measured on the last business day of our most recent second fiscal quarter.
As of June 30, 2026, the aggregate market value of our common shares held by non-affiliates exceeded $700.0 million. We may continue to take advantage of certain reduced disclosures available to smaller reporting companies through the filing of our Annual Report on Form 10-K for the year ending December 31, 2026 and we will not be required to provide an attestation report on internal control over financial reporting issued by our independent registered public accounting firm until the filing of our Annual Report on Form 10-K for the year ending December 31, 2027.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There have been no material changes in market risk exposures that affect the disclosures presented in Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” in our Annual Report on Form 10-K for the year ended December 31, 2025.
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ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer (our principal executive officer and principal financial officer, respectively), evaluated the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of September 30, 2026. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosures.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting during the three months ended September 30, 2026 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II—OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
From time to time, we may become involved in litigation or other legal proceedings. We are not currently a party to any litigation or legal proceedings that we believe are likely to have a material adverse effect on our business, financial condition, results of operations or prospects. Regardless of the outcome, litigation can have an adverse impact on our business, financial condition, results of operations or prospects because of defense and settlement costs, diversion of management resources, negative publicity, reputational harm and other factors.
Please see the information pertaining to legal proceedings in "Item 1. Financial Statements—Note 9. Commitments and Contingencies," to the interim consolidated financial statements, which is incorporated by reference herein.
ITEM 1A. RISK FACTORS
You should carefully consider the following risk factors as well as the other information included in this Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our condensed consolidated financial statements and related notes thereto. Any of the following risks could materially and adversely affect our business, financial condition, or results of operations. The selected risks described below, however, are not the only risks facing us. Additional risks and uncertainties not currently known to us or those we currently view to be immaterial may also materially and adversely affect our business, financial condition, or results of operations. The summary of the material risks associated with our business is included in the “Special Note Regarding Forward-Looking Statements” on page 4 above.
Risks Related to Our Financial Position and Need for Additional Capital
We are a clinical-stage biotechnology company and have incurred significant losses since our inception. We expect to incur losses for until such time as we can generate revenue from sales of COMP360 or other therapeutic candidates sufficient to sustain profitability and may never achieve or maintain profitability.
We are a clinical-stage biotechnology company and we have not generated any revenue to date. We have incurred significant operating losses since our formation. We have incurred recurring operating losses since our inception. While we reported net income in certain periods, those results were primarily attributable to non-recurring, non-cash items rather than ongoing operations. For the nine months ended September 30, 2026, we recognized net loss of $172.4 million, compared to a net loss of $194.0 million for the nine months ended September 30, 2025. As of September 30, 2026, we had an accumulated deficit of $995.0 million. Our historical losses resulted principally from costs incurred in connection with research and development activities and selling, general and administrative costs associated with our operations. During the term of our pre-funded warrants, or the Pre-Funded Warrants, issued in our registered financing in January 2025, or the January 2025 Financing, and in our underwritten offering in February 2026, or the February 2026 Offering, which are classified as liabilities, our net loss can change significantly quarter to quarter due to non-cash increases or decreases in the fair value of these warrants. We intend to continue to conduct research and development, clinical trials, regulatory compliance, market access and commercialization activities that, together with anticipated selling, general and administrative expenses, will result in incurring further significant operating losses for at least the next several years. Our expected operating losses, among other things, may continue to cause our working capital and shareholders’ equity to decrease. We anticipate that our expenses will increase substantially if and as we, among other things:
•
complete our rolling NDA submission;
•
prepare for commercial launch of COMP360 psilocybin treatment in TRD, if approved, including establishing a sales, marketing and distribution infrastructure and scaling-up manufacturing capabilities;
•
advance our commercialization strategy;
•
advance our Phase 2b/3 clinical trial in PTSD;
•
continue the training of qualified healthcare professionals to monitor and safeguard participants in our clinical trials;
•
service our outstanding indebtedness;
•
may in the future resume and pursue research and development programs for our other nonclinical stage therapeutic candidates and discovery-stage programs and/or develop and seek regulatory approval for any future therapeutic candidates that successfully complete clinical trials;
•
establish and expand the number of public healthcare institutions and private clinics that could administer our investigational COMP360 psilocybin treatment if approved;
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•
experience potential heightened regulatory scrutiny;
•
pursue necessary scheduling-related decisions by the U.S. Drug Enforcement Administration, or the DEA, and various state governments to enable us to commercialize any therapeutic candidates containing controlled substances for which we may obtain regulatory approval, including COMP360;
•
obtain, maintain, expand and protect our intellectual property portfolio, including litigation costs associated with defending against alleged patent or other intellectual property infringement claims;
•
add clinical, scientific, operational, financial and management information systems and personnel, including personnel to support our therapeutic development and potential future commercialization efforts;
•
experience any delays or encounter any issues with respect to any of the above, including failed studies, ambiguous trial results, safety issues or other regulatory challenges, including, for example, delays and other impacts as a result of pandemics or other public health crises;
•
expand our operations in the U.S. and Europe in the future; and
•
incur additional legal, accounting and other expenses associated with operating as an English-domiciled public company listed in the U.S.
We have funded our operations since our initial public offering, or IPO, in 2020, through public equity offerings, private placements of ADSs and warrants and debt financing. To become and remain profitable, we will need to continue developing and eventually commercialize treatments that generate significant revenue. This will require us to be successful in a range of challenging activities, including obtaining regulatory approval for COMP360 psilocybin treatment in TRD, completing our Phase 2b/3 clinical trial in PTSD and any other clinical trials of COMP360 or any future therapeutic candidates, training a sufficient number of qualified healthcare professionals to monitor and safeguard participants in our clinical trials, discovering and developing any future therapeutic candidates, obtaining regulatory approval for any future therapeutic candidates that successfully complete clinical trials, and establishing sales and marketing capabilities. Even if COMP360 psilocybin treatment or any of the future therapeutic candidates that we may develop are approved for commercial sale, we anticipate incurring significant costs associated with commercializing COMP360 or any other approved future therapeutic candidate. We may never succeed in these activities and, even if we do, may never generate revenue that is significant enough to achieve profitability.
Because of the numerous risks and uncertainties associated with therapeutic development, we are unable to accurately predict the timing or amount of increased expenses or when, or if, we will be able to achieve profitability. If we are required by the FDA, the EMA, the MHRA, or other comparable foreign authorities to perform studies in addition to those we currently anticipate, or if there are any delays in completing our clinical trials or the development of our investigational COMP360 psilocybin treatment or any future therapeutic candidates, our expenses could increase beyond our current expectations and revenue could be further delayed.
Even if we or any future collaborators do generate sales, we may never achieve, sustain or increase profitability on a quarterly or annual basis. Our failure to sustain profitability would depress the market price of our ADSs and could impair our ability to raise capital, repay our outstanding indebtedness, expand our business, diversify our therapeutic offerings or continue our operations. If we continue to suffer losses, investors may not receive any return on their investment and may lose their entire investment.
Unless and until we generate product revenue and achieve and sustain profitability, we will continue to need additional financing to fund our operations and capital expenditures. Failure to obtain additional funding when needed or on favorable terms may force us to delay, limit or terminate certain or all of our product discovery, therapeutic development, research operations or commercialization efforts
or grant rights to develop and market products or therapeutic candidates that we would otherwise prefer to develop and market ourselves.
Unless and until we generate product revenue and achieve and sustain profitability, we will need additional funding in the future to sufficiently finance our operations. If the PIPE Warrants outstanding, as of September 30, 2026, are exercised in full for cash, we would receive an additional $79.7 million in gross proceeds. However, because the holders of the PIPE Warrants are not obligated to exercise such warrants, we have not included any anticipated proceeds from such exercises of PIPE Warrants in our estimate of our cash runway. We expect that our cash and cash equivalents of $444.0 million as of September 30, 2026 will enable us to fund our operating expenses and capital expenditure requirements into 2028. We have based our estimated cash runway on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect. Further, changing circumstances, some of which may be beyond our control, such as fluctuating inflation and interest rates, could cause us to consume capital significantly faster than we currently anticipate, and we may need to seek additional funds sooner than planned. Our future funding requirements, both short-term and long-term, will depend on many factors, including:
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•
the progress, timing and completion of our rolling NDA submission and potential commercialization activities;
•
the progress, timing and completion of our Phase 2b/3 clinical trial in PTSD;
•
the outcome, timing and cost of seeking and obtaining regulatory approvals from the FDA, the EC, the MHRA and comparable foreign regulatory authorities, including the potential for such authorities to require that we perform more nonclinical studies or clinical trials than those that we currently expect or change their requirements on studies that had previously been agreed to;
•
the outcome and timing of any scheduling-related decisions by the DEA, individual states, and comparable foreign authorities;
•
the number of potential future therapeutic candidates we may choose to pursue and identify in the future and decide to develop, either internally through our research and development efforts or externally through acquisitions, licensing or other collaboration agreements;
•
the costs involved in growing our organization in the near term to the size needed to prepare for the potential commercialization of our investigational COMP360 psilocybin treatment in TRD and any future therapeutic candidates, including increases to personnel costs;
•
the costs of developing sales and marketing capabilities to prepare for potential commercial launch of COMP360 psilocybin treatment in TRD to target public and private healthcare providers and clinic networks in the U.S. and other major markets;
•
the costs of training qualified healthcare professionals to monitor and safeguard participants in our clinical trials;
•
the costs of maintaining research collaborations, such as the Center for Mental Health Research, which includes conducting clinical trials, including proof of concept studies, to refine our treatment delivery model;
•
the time and costs involved in generating and collecting data and advancing and defending our intellectual property portfolio, including the costs involved in filing patent applications and maintaining and enforcing patents or defending against claims of infringements or invalidity raised by third parties;
•
the costs of developing, testing and deploying digital technology solutions or paying a third-party to provide such technology solutions to improve the patient experience and therapeutic process via third-party service providers or internally;
•
the time and costs involved in obtaining regulatory approval for COMP360 or any future therapeutic candidates, and any delays we may encounter as a result of evolving regulatory requirements or adverse results with respect to COMP360 or any future therapeutic candidates;
•
selling and marketing activities undertaken in connection with the potential commercialization of our investigational COMP360 psilocybin treatment or any future therapeutic candidates, if approved, and costs involved in the creation of an effective sales and marketing organization;
•
the amount of revenue, if any, we may derive either directly or in the form of royalty, milestone or other payments from future sales of our investigational COMP360 psilocybin treatment and any future therapeutic candidates, if approved;
•
the impact of macroeconomic and geopolitical events, including, among others, fluctuating inflation and interest rates, fluctuations in foreign exchange rates, the risk of economic slowdown or recession in the U.S., international tensions, and changes in legislation and governmental policies and resources, including the effects of announced or future tariff increases; and
•
the costs of operating as a public company.
Until we can generate sufficient revenue to finance our cash requirements, which we may never do, we expect to finance our future cash needs through a combination of public or private equity offerings, debt financings, strategic collaborations and alliances, licensing arrangements or monetization transactions.
Our ability to raise additional funds when needed and on acceptable terms or at all will depend on financial, economic and market conditions and other factors, over which we may have no or limited control. For example, volatility in the capital markets, fluctuating inflation and interest rates, concerns about potential recessionary factors, and macroeconomic and geopolitical events and conditions may affect our ability to raise additional funding, including through the exercise for cash of the PIPE Warrants, sales of our securities or issuance of indebtedness, which may harm our liquidity, force us to delay, limit or terminate certain or all of our product discovery, therapeutic development, research operations, work for our rolling NDA submission or commercialization planning efforts or cause us to grant rights to develop and market products or therapeutic candidates that we would otherwise prefer to develop and market ourselves. If adequate funds are not available on
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commercially acceptable terms when needed, we may be forced to delay, reduce or terminate the development or commercialization of all or part of our research programs or our investigational COMP360 psilocybin treatment or any future therapeutic candidate, or we may be unable to take advantage of future business opportunities. Market volatility, geopolitical tensions, such as those resulting from the ongoing war between Ukraine and Russia, conflict in the Middle East, changes in legislation and governmental policies and resources, including the effects of announced or future tariff increases, fluctuating inflation and interest rates, and the related impact on U.S. and global economies, the risk of economic slowdown or recession in the U.S., significant changes in U.S. policies or regulatory environment or disruption to U.S. government agencies or other factors could also adversely impact our ability to access capital as and when needed or increase our costs in order to raise capital.
We cannot guarantee that future financing will be available in sufficient amounts, or on commercially reasonable terms, or at all. Recent capital market conditions, including the impact of inflation, have increased borrowing rates compared to rates in the recent past and can be expected to significantly increase our cost of capital as compared to prior periods. Moreover, the terms of any financing may adversely affect the holdings or the rights of holders of our ADSs, the issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our ADSs to decline. Our Loan Agreement with Hercules includes, and any future debt financing, if available, may involve agreements that include affirmative and negative restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business. For example, our Loan Agreement with Hercules contains financial covenants requiring us to maintain certain minimum cash balances beginning October 1, 2027 and we will need to raise additional financing or significantly reduce our operating expenses to maintain compliance with this financial covenant. We could also be required to seek funds through arrangements with collaborators or others at an earlier stage than otherwise would be desirable and we may be required to relinquish rights to COMP360 or any future therapeutics candidates or otherwise agree to terms unfavorable to us, any of which may have a material adverse effect on our business, operating results and prospects. Further, any additional fundraising efforts may divert our management from its day-to-day activities, which may adversely affect our ability to develop and commercialize our investigational COMP360 psilocybin treatment or any future therapeutic candidates.
In addition, heightened regulatory scrutiny, regulatory delays or uncertainty in the regulatory environment could have a negative impact on our ability to raise capital. Our business activities rely on developing laws and regulations in multiple jurisdictions. It is impossible to determine the extent of the impact of any new laws, regulations or initiatives that may be proposed, or whether any proposals will become law. The regulatory uncertainty surrounding our investigational COMP360 psilocybin treatment or any future therapeutic candidates may adversely affect our business and operations, including without limitation, our ability to raise additional capital.
Outstanding warrants for our securities may not be exercised and we may not receive any additional funds upon the exercise of outstanding warrants.
As of September 30, 2026, we had 8,025,339 outstanding PIPE Warrants. The holders of the outstanding PIPE Warrants are not obligated to exercise the PIPE Warrants, so we may not receive any additional proceeds from the PIPE. The PIPE Warrants are exercisable for a three-year period ending in February 2027 and have an exercise price of $9.93. We believe the likelihood that these holders will exercise the PIPE Warrants, and therefore any cash proceeds that we may receive in relation to the exercise of such PIPE Warrants, will be dependent on the trading price of our ADSs relative to the exercise price and the trading price of our ADSs may not continue to exceed the exercise price of the PIPE Warrants prior to their expiration.
In addition, the PIPE Warrants may be exercised on a cashless basis if there is no effective registration statement registering the shares underlying the PIPE Warrants, in which case we would not receive any additional proceeds. If the PIPE Warrants are not exercised for cash, or only a portion of the PIPE Warrants are exercised for cash, we would need to obtain additional funding from other sources and may need to raise funds earlier than expected. Further, changing circumstances, some of which may be beyond our control, such as fluctuating inflation and interest rates, could cause us to consume capital significantly faster than we currently anticipate, and we may need to seek additional funds sooner than planned. Adequate additional financing may not be available to us on acceptable terms or at all.
We will not receive any meaningful amount of additional funds upon the exercise of the Pre-funded Warrants; however, any exercise would increase the number of ADSs outstanding and result in dilution to our existing shareholders.
As of September 30, 2026, we had 23,848,829 Pre-Funded Warrants outstanding. Each Pre-funded Warrant will be exercisable until it is fully exercised by means of either a cash payment of the exercise price of $0.0001 per ADS or by way of a cashless exercise, meaning that the holder may not pay a cash purchase price upon exercise, but instead would receive upon such exercise the net number of ADSs representing ordinary shares determined according to the formula set forth in the Pre-funded Warrant. Accordingly, we will not receive any meaningful, or potentially any, additional funds upon the exercise of the Pre-funded Warrants. To the extent such Pre-funded Warrants are exercised, additional ADSs will be issued for nominal or no additional consideration, which will result in dilution to the then existing holders of our ADSs and will increase the number of ADSs and ordinary shares outstanding.
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Our history as a clinical stage company, with no approved products to date may make it difficult for you to evaluate the success of our business to date and to assess our future viability.
We were formed in 2016 and to date, we have invested most of our resources in developing our investigational COMP360 psilocybin treatment, building our intellectual property portfolio, conducting business planning, raising capital and providing administrative support for these operations. Although we conducted our first Phase 3 program for our COMP360 psilocybin treatment for TRD, we have not yet demonstrated an ability to successfully obtain regulatory approvals, manufacture a commercial-scale product, conduct sales and marketing activities necessary for successful product commercialization or obtain reimbursement in the countries of sale.
We have in the past encountered, and may in the future encounter, unforeseen expenses, difficulties, complications, delays and other known or unknown factors in achieving our business objectives. If we receive regulatory approval for our COMP360 psilocybin treatment or any future product candidate, we will need to transition from a company with a clinical development focus to a company capable of supporting commercial activities. We may not be successful in such a transition.
We expect our financial condition and operating results to continue to fluctuate significantly from quarter to quarter and year to year due to a variety of factors, many of which are beyond our control. In addition, during the term of our Pre-funded Warrants, which are classified as liabilities, our net loss is expected to fluctuate significantly quarter to quarter due to non-cash increases or decreases in the fair value of these Pre-funded Warrants. Accordingly, you should not rely upon the results of any quarterly or annual periods as indications of future operating performance.
Raising additional capital through equity financings may cause dilution to holders of our ordinary shares and ADSs and raising additional capital through debt financings, strategic partnerships, collaborations or any other means may restrict our operations or require us to relinquish rights to COMP360 or any future therapeutic candidates.
We may seek additional capital through a combination of equity offerings, debt financings, strategic collaborations and alliances, licensing arrangements or monetization transactions. To the extent that we raise additional capital through the sale of equity, convertible debt securities or other equity-based derivative securities or the exercise of the PIPE Warrants, your ownership interest will be diluted and the terms may include liquidation or other preferences that adversely affect your rights as a shareholder. For example, if all of the outstanding warrants were exercised, we would issue 31,968,390 ADSs which would result in significant dilution to our shareholders. In addition, we have raised additional funds in the past and may raise additional funds in the future by issuing equity securities under our ATM Facility and, as a result, our stockholders have in the past experienced and may in the future experience dilution. Our Loan Agreement with Hercules includes, and any future debt financing, if available, may involve agreements that include affirmative and negative restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business. For example, our Loan Agreement with Hercules contains financial covenants requiring us to maintain certain minimum cash balances beginning October 1, 2027 and we will need to raise additional financing or significantly reduce our operating expenses to maintain compliance with this financial covenant. Furthermore, the issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our ADSs to decline and existing shareholders may not agree with our financing plans or the terms of such financings. If we raise additional funds through strategic collaborations and alliances, licensing arrangements or monetization transactions with third parties, we may have to relinquish valuable rights to our investigational COMP360 psilocybin treatment or any future therapeutic candidates or otherwise agree to terms unfavorable to us, any of which may have a material adverse effect on our business, operating results and prospects. Adequate additional financing may not be available to us on acceptable terms, or at all. If we are unable to raise additional funds when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market our investigational COMP360 psilocybin treatment or any future therapeutic candidates that we would otherwise prefer to develop and market ourselves. Further, any additional fundraising efforts may divert our management from its day-to-day activities, which may adversely affect our ability to develop and commercialize our investigational COMP360 psilocybin treatment or any future therapeutic candidates.
Furthermore, certain shareholders and holders of ADSs, including those in the U.S., may, even in the case where preferential subscription rights have not been cancelled or limited, not be entitled to exercise such rights, unless the offering is registered or the ordinary shares are qualified for sale under the relevant regulatory framework. In addition, we have in the past submitted, and may in the future submit, to shareholders a special resolution at our annual meeting to disapply preemptive rights. As a result, there is the risk that investors may suffer dilution of their holdings should they not be permitted to participate in preference right equity or other offerings that we may conduct in the future.
We may not satisfy the conditions set forth in our Loan Agreement with Hercules in order to draw down additional funding on our term loan facility.
We may borrow additional funds of up to $100.0 million in three tranches under the terms of our Loan Agreement. The remaining tranches of term loans under our Loan Agreement with Hercules consist of (i) term loans of up to $30.0 million
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subject to our achievement of a milestone relating to certain FDA approvals being granted, (ii) term loans of up to $20.0 million subject to our achievement of a specified commercial milestone, and (iii) term loans of up to $20.0 million, plus the $30.0 million that became available to us upon achievement of a specified clinical milestone and any remaining unborrowed amounts from the earlier tranches, subject to the approval of Hercules’ investment committee. If these conditions are met, these remaining tranches may be borrowed in drawings of a minimum of $5.0 million each. Without the achievement of the specified regulatory and commercial milestones and the satisfaction of certain customary conditions, we will not be eligible to draw additional funds under the remaining tranches. If we do not receive approval from Hercules’ investment committee, which is beyond our control, we will not be eligible to draw funds under the final tranche under our Loan Agreement and will not realize the full benefits of our Loan Agreement. If we are unable to draw down additional funding under the terms of the Loan Agreement, our business, financial condition and results of operations may be harmed and we may be required to seek out alternative financing sources which may have less favorable terms.
Our operating activities may be restricted as a result of covenants related to our Loan Agreement, which could have a material adverse effect on our business, financial condition and results of operations.
On January 5, 2026, we