Crinetics Pharmaceuticals, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

(Unless otherwise indicated, all dollar amounts are presented in thousands, except per share amounts)

1. Organization and Basis of Presentation

Description of Business

Crinetics Pharmaceuticals, Inc. is a pharmaceutical company committed to transforming the treatment of endocrine diseases and endocrine-related tumors through science rooted in patient needs. We are focused on discovering, developing, and commercializing novel therapies, with a core expertise in targeting GPCRs with small molecules that have specifically tailored pharmacology and properties.

Our first commercial product, PALSONIFY™ (paltusotine), is the first once-daily, oral treatment approved by the FDA and EMA for the treatment of adults with acromegaly who had an inadequate response to surgery and/or for whom surgery is not an option. Paltusotine is also in clinical development for carcinoid syndrome associated with NETs. Our pipeline of disclosed programs includes late-stage investigational candidate atumelnant, which is currently in development for CAH and ADCS, and CRN09682, a nonpeptide drug conjugate candidate that is being developed to treat SST2 expressing NETs and other SST2 expressing solid tumors. Additional discovery programs are focused on a variety of endocrine targets such as thyroid stimulating hormone, parathyroid hormone, somatostatin receptor 3, growth hormone, glucagon-like peptide-1, and glucose-dependent insulinotropic polypeptide, as well as GPCR-targeted oncology indications.

Basis of Presentation and Principles of Consolidation

The accompanying condensed consolidated financial statements are unaudited, and reflect all adjustments which are, in the opinion of management, of a normal recurring nature and necessary for a fair statement of the results for the interim periods presented in accordance with U.S. GAAP.

Our condensed consolidated balance sheet for the year ended December 31, 2025 was derived from our audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP. The interim results presented herein are not necessarily indicative of the results expected for the full fiscal year or any other interim period. Our condensed consolidated financial statements should be read in conjunction with the FY 2025 Form 10-K.

Our condensed consolidated financial statements include our accounts and those of our wholly-owned subsidiaries, and have been prepared in conformity with U.S. GAAP. All intercompany transactions and balances have been eliminated.

Liquidity

From inception, we have devoted substantially all of our efforts to drug discovery and development, conducting preclinical studies and clinical trials, building the infrastructure necessary for commercial operations, and launching PALSONIFY in the U.S. We have a limited operating history and the sales and income potential of our business and market are unproven. While we have received FDA and EMA approval for our lead product, we may continue to incur substantial operating losses even as we generate revenue from PALSONIFY, and a successful transition to attaining profitable operations is dependent upon achieving a level of revenue adequate to support our cost structure.

We have experienced net losses and negative cash flows from operating activities since our inception and have an accumulated deficit of $1.5 billion as of March 31, 2026. As of March 31, 2026, we had $1.3 billion in cash, cash equivalents and investment securities, which we believe is sufficient to fund our operating cash needs for at least the next 12 months from the date of issuance of these unaudited condensed consolidated financial statements.

Our future long-term liquidity requirements will be substantial and will depend on many factors, including our ability to effectively commercialize PALSONIFY and other product candidates. We expect to continue to incur net losses for the foreseeable future and may need to raise substantial additional capital to accomplish our business objectives. We plan to continue to fund our losses from operations and capital funding needs through a combination of existing capital resources, product sales, equity offerings, debt financings or other sources, including potential collaborations, licenses and other similar arrangements. If we are not able to secure adequate additional funding, we may be forced to make reductions in spending, extend payment terms with suppliers, liquidate assets where possible, or suspend or curtail planned programs. Any of these actions could materially harm our business, results of operations and prospects. There can be no assurance as to the availability or terms upon which such financing and capital might be available in the future.

Significant Accounting Policies

There have been no material changes to our significant accounting policies from the FY 2025 Form 10-K.

Use of Estimates

The preparation of our condensed consolidated financial statements requires us to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenue and expenses and the disclosure of contingent assets and liabilities in our condensed consolidated financial statements and accompanying notes. The estimates in our condensed consolidated financial statements include, but are not limited to, accrual of research and development expenses, valuation of stock-based awards, fair values of financial instruments, inventory valuation, and revenue recognition.

As of the date of issuance of these condensed consolidated financial statements, we are not aware of any specific event or circumstance that would require us to update our estimates, judgments or revise the carrying value of our assets or liabilities. These estimates may change as new events occur and additional information is obtained, and are recognized in the condensed consolidated financial statements as soon as they become known. Actual results could differ from those estimates and any such differences may be material to our condensed consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

ASU 2024-03

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, which requires disaggregated disclosure of income statement expenses for PBEs. ASU 2024-03 does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. ASU 2024-03 is effective for all PBEs for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the impact that this guidance will have on the presentation of our condensed consolidated financial statements and accompanying notes.

ASU 2025-03

In May 2025, the FASB issued ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity, which provides guidance for identifying the accounting acquirer in business combinations in which the legal acquiree is a VIE that meets the definition of a business. Under the ASU, the acquirer is determined using the factors in ASC 805, Business Combinations, rather than assuming the primary beneficiary is the acquirer. ASU 2025‑03 is effective for fiscal years beginning after December 15, 2026, and interim periods within those years, with early adoption permitted. We are currently evaluating the impact of this guidance on the presentation of our condensed consolidated financial statements and accompanying notes.

2. Investment Securities

We report our available-for-sale investment securities at their estimated fair values. The following is a summary of our available-for-sale investment securities as of March 31, 2026 and December 31, 2025:

As of March 31, 2026 and December 31, 2025, available-for-sale investment securities by contractual maturity were as follows:

The following is a summary of the available-for-sale investment securities by length of time in a net loss position as of March 31, 2026 and December 31, 2025:

As of March 31, 2026 and December 31, 2025, all available-for-sale investment securities in a continuous unrealized loss position had been in a loss position for less than 12 months.

We reviewed our investment holdings as of March 31, 2026 and December 31, 2025 and determined that the decrease in fair value is attributable to changes in interest rates and not credit quality. Therefore, there wereno allowances for credit losses.

Accrued interest receivable on available-for-sale securities was $9.0 million and $7.8 million at March 31, 2026 and December 31, 2025, respectively.

3. Fair Value Measurements

Fair value measurements may be based on trade prices in active markets for identical assets or liabilities (Level 1 inputs) or valuation models using inputs that are observable either directly or indirectly (Level 2 inputs), such as quoted prices for similar assets or liabilities, yield curves, volatility factors, credit spreads, default rates, loss severity, current market and contractual prices for the underlying instruments or debt, and broker and dealer quotes, as well as other relevant economic measures.

Financial assets measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025 were as follows:

(1)Consists of mutual fund investments held in the Rabbi Trust related to our non-qualified deferred compensation plan.

4. Balance Sheet Details

Inventory

Inventory consisted of the following:

Inventory balances include the capitalization of PALSONIFY manufacturing costs following the regulatory approval in September 2025. PALSONIFY inventory produced prior to approval was expensed as research and development. We did not hold any raw materials inventory as of March 31, 2026 or December 31, 2025.

There were no write-downs of inventory during the three months ended March 31, 2026 and 2025.

Prepaid expenses and other assets

Prepaid expenses and other assets consisted of the following:

Property and Equipment, net

Property and equipment, net consisted of the following:

Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following:

5. Operating Leases

The Company entered into the 2022 Lease in April 2022. The 2022 Lease is a non-cancellable operating lease and expires in April 2035.

Under the terms of the 2022 Lease, we provided the lessor with an irrevocable letter of credit in the amount of $0.8 million, which is included as restricted cash in the accompanying condensed consolidated balance sheets. The lessor is entitled to draw on the letter of credit in the event of any default by us under the terms of the 2022 Lease.

As of March 31, 2026, our future minimum payments under the 2022 Lease were as follows:

Operating lease cost was $1.9 million and $2.2 million for the three months ended March 31, 2026 and 2025, respectively. Short-term lease expenses for the three months ended March 31, 2026 and 2025 were not significant.

Remaining lease terms and discount rates for our operating lease are as follows:

Supplemental cash flow information related to leases was as follows: