RIGEL PHARMACEUTICALS INC (RIGL)

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

This discussion and analysis should be read in conjunction with our financial statements and the accompanying notes included in this report and the audited financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC on March 3, 2026. Our financial results for the three and six months ended June 30, 2026 are not necessarily indicative of results that may occur in future interim periods or for the full fiscal year.

This Quarterly Report on Form 10-Q contains statements indicating expectations about future performance and other forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act), and the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. We usually use words such as “may,” “will,” “would,” “should,” “could,” “expect,” “plan,” “anticipate,” “might,” “believe,” “estimate,” “predict,” “intend,” or the negative of these terms or similar expressions to identify these forward-looking statements. These statements appear throughout this Quarterly Report on Form 10-Q and are statements regarding our current expectations, beliefs or intent, primarily with respect to our operations and related industry developments. Examples of these statements include, but are not limited to: our business and scientific strategies; risks and uncertainties associated with the commercialization, distribution, marketing, and payment for our products in the US and outside the US; risks that the FDA, EMA, the Medicines and Health Products Regulatory Agency (MHRA) or other regulatory authorities may make adverse decisions regarding our products; the impact of the US federal government shutdowns or agency funding disruptions; the progress of our and our collaborators’ product development programs, including clinical testing, and the timing of results thereof; our corporate collaborations and revenues that may be received from our collaborations and the timing of those potential payments; our expectations with respect to obligations to entities party to commercial or licensing agreements with us and the timing of those obligations; our expectations with respect to timing of recognizing product sales; our expectations with respect to the volume of product sales; the anticipated commercial launch and commercialization of VEPPANU; our expectations with respect to potential patient populations; our expectations with respect to regulatory submissions and approvals; our drug discovery technologies; our research and development expense; protection of our intellectual property and our intention to vigorously enforce our intellectual property rights; the availability and sufficiency of our cash and capital resources and the need for additional capital; our ability to successfully identify and acquire or in-license products or companies; our operations and legal risks; and the effectiveness of our cybersecurity risk management process. You should not place undue reliance on these forward-looking statements. Our actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including as a result of the risks and uncertainties discussed under the heading “Risk Factors” in Item 1A of Part II of this Quarterly Report on Form 10-Q. Any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as required by applicable law. New factors emerge from time to time, and it is not possible for us to predict which factors will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

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Overview

We are a biotechnology company dedicated to developing and providing novel therapies that significantly improve the lives of patients with hematologic disorders and cancer. We focus on products that address signaling pathways that are critical to disease mechanisms.

TAVALISSE (fostamatinib disodium hexahydrate) is our first FDA-approved product and is the only approved oral SYK inhibitor for the treatment of adult patients with chronic ITP who have had an insufficient response to a previous treatment. The product is also commercially available in Europe and the UK (as TAVLESSE), and in Japan, Korea, Canada and Israel (as TAVALISSE) for the treatment of chronic ITP in adult patients.

REZLIDHIA (olutasidenib) is our second FDA-approved product indicated for the treatment of adult patients with R/R AML with a susceptible IDH1 mutation as detected by an FDA-approved test. We in-licensed REZLIDHIA from Forma with exclusive, worldwide rights for its development, manufacturing and commercialization, pursuant to a license and transition services agreement entered in July 2022.

GAVRETO (pralsetinib) is our third FDA-approved product which we began commercializing in June 2024. GAVRETO is a once daily, small molecule, oral, kinase inhibitor of wild-type RET and oncogenic RET fusions. GAVRETO is approved by the FDA for the treatment of adult patients with metastatic RET fusion-positive NSCLC as detected by an FDA-approved test. GAVRETO is also approved under accelerated approval based on overall response rate and duration response, for the treatment of adult and pediatric patients 12 years of age and older with advanced or metastatic RET fusion-positive thyroid cancer who require systemic therapy and who are radioactive iodine-refractory (if radioactive iodine is appropriate). We acquired the rights to research, develop, manufacture and commercialize GAVRETO in the US from Blueprint pursuant to an asset purchase agreement entered in February 2024.

VEPPANU (vepdegestrant) is our fourth FDA-approved product which we expect to become commercially available in mid-August 2026. VEPPANU is an oral PROTAC approved by the FDA for the treatment of ER+/HER2-, ESR1-mutated advanced or metastatic breast cancer, as detected by an FDA-authorized test, with disease progression following at least one line of endocrine therapy. We in-licensed VEPPANU pursuant to a license agreement entered in May 2026 with Arvinas and Pfizer.

Our development pipeline includes R289, our dual IRAK1/4 inhibitor, which is being advanced in an open-label, Phase 1b study to determine the safety, tolerability and preliminary efficacy of the drug in patients with lower-risk MDS who are relapsed, refractory or resistant to prior therapies.

To expand our evaluation of olutasidenib in other disease areas with IDH1 mutations, we have strategic development collaborations with MDACC and with CONNECT.

Business Updates

Commercialized Products

TAVALISSE net product sales for the six months ended June 30, 2026 were $84.7 million, an increase of $16.1 million, or 24%, compared to $68.5 million for the same period in 2025. The increase was primarily driven by higher volumes and higher price per bottle, as well as a favorable impact from lower revenue reserves.

REZLIDHIA net product sales for the six months ended June 30, 2026 were $17.0 million, an increase of $3.8 million, or 29%, compared to $13.1 million for the same period in 2025. The increase was primarily driven by higher volumes and higher price per bottle, partially offset by higher revenue reserves.

GAVRETO net product sales for the six months ended June 30, 2026 were $20.3 million, a decrease of $0.5 million, or 2%, compared to $20.8 million for the same period in 2025. The decrease was primarily driven by lower volumes and higher revenue reserves, partially offset by higher price per bottle.

VEPPANU is our fourth FDA-approved product which we expect to become commercially available in mid-August 2026. We in-licensed VEPPANU pursuant to a license agreement entered in May 2026 with Arvinas and Pfizer (together, the Licensors), which agreement became effective on June 11, 2026 upon the early termination of the waiting period under the HSR Act. Pursuant to the license agreement, the Licensors granted us an exclusive, royalty-bearing license to develop, manufacture and commercialize VEPPANU (vepdegestrant) and vepdegestrant-containing products (the licensed products) worldwide. VEPPANU is approved in the US for the treatment of adults with ER+/HER2-negative,

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ESR1-mutated advanced or metastatic breast cancer, as detected by an FDA-authorized test, with disease progression following at least one line of endocrine therapy.

Under the license agreement, we agreed to pay the Licensors a license fee of up to $85.0 million, including $70.0 million upfront payment which we paid in June 2026, and up to an additional $15.0 million payable upon the successful completion of certain transition activities. In addition, the Licensors are eligible to receive up to $60.0 million in regulatory milestones upon achievement of specified regulatory approvals, and up to $260.0 million in commercial milestone payments upon achievement of specified net sales thresholds. We are also obligated to pay tiered royalties on annual net sales of licensed products ranging in percentages from the mid-teens to mid-twenties, subject to certain reductions and customary adjustments, and to share a portion of sublicense revenue with the Licensors at tiered rates that decrease based on the timing of execution of the applicable sublicense.

Under the license agreement, we will have the sole rights and will be primarily responsible for the development and commercialization of the licensed products worldwide, subject to certain transition activities to be performed by the Licensors. The license agreement includes customary diligence obligations for us to use commercially reasonable efforts to develop and commercialize the licensed products, including to seek regulatory approvals in specified major markets. The license agreement will remain in effect on a product-by-product and country-by-country basis until the expiration of the applicable royalty term for each licensed product in each country, after which the license becomes fully paid-up and perpetual. The license agreement may be terminated by either party under customary circumstances, including for material breach or certain insolvency events. In addition, the Licensors may terminate the license agreement if we cease all material development and commercialization activities for the licensed products for an extended period of time, subject to specified exceptions, or if we breach certain compliance-related obligations relating to anti-corruption and global trade controls. Upon termination of the license agreement prior to its expiration, the licenses granted to us will terminate and, at the Licensors’ request, the parties will negotiate in good faith an exclusive license from us to the Licensors under certain patent rights and know-how controlled by us covering the terminated licensed products. The license agreement contains customary provisions relating to, among other things, intellectual property, indemnification, confidentiality, and representations and warranties.

Pursuant to the license agreement, the Licensors will continue to be responsible for specified ongoing development, regulatory, manufacturing and transition activities. We are obligated to reimburse development costs incurred by the Licensors in connection with the ongoing studies, subject to an aggregate funding cap of $40.0 million and specified cumulative annual and quarterly funding caps through 2029. The related costs are re

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Overview

We are a biotechnology company dedicated to developing and providing novel therapies that significantly improve the lives of patients with hematologic disorders and cancer. We focus on products that address signaling pathways that are critical to disease mechanisms.

TAVALISSE (fostamatinib disodium hexahydrate) is our first FDA-approved product and is the only approved oral SYK inhibitor for the treatment of adult patients with chronic ITP who have had an insufficient response to a previous treatment. The product is also commercially available in Europe and the UK (as TAVLESSE), and in Japan, Korea, Canada and Israel (as TAVALISSE) for the treatment of chronic ITP in adult patients.

REZLIDHIA (olutasidenib) is our second FDA-approved product indicated for the treatment of adult patients with R/R AML with a susceptible IDH1 mutation as detected by an FDA-approved test. We in-licensed REZLIDHIA from Forma with exclusive, worldwide rights for its development, manufacturing and commercialization, pursuant to a license and services agreement entered in July 2022.

GAVRETO (pralsetinib) is our third FDA-approved product which we began commercializing in June 2024. GAVRETO is a once daily, small molecule, oral, kinase inhibitor of wild-type RET and oncogenic RET fusions. GAVRETO is approved by the FDA for the treatment of adult patients with metastatic RET fusion-positive NSCLC as detected by an FDA-approved test. GAVRETO is also approved under accelerated approval based on overall response rate and duration response rate, for the treatment of adult and pediatric patients 12 years of age and older with advanced or metastatic RET fusion-positive thyroid cancer who require systemic therapy and who are radioactive iodine-refractory (if radioactive iodine is appropriate). We acquired the rights to research, develop, manufacture and commercialize GAVRETO in the US from Blueprint pursuant to an asset purchase agreement entered in February 2024.

Our development pipeline includes R289, our dual IRAK1/4 inhibitor program, which is being advanced in an open-label, Phase 1b study to determine the safety, tolerability and preliminary efficacy of the drug in patients with lower-risk MDS who are relapsed, refractory or resistant to prior therapies.

To expand our evaluation of olutasidenib in other disease areas with IDH1 mutations, we have strategic development collaborations with MDACC and with CONNECT. We also have a RIPK1 inhibitor program in clinical development that is being led by our partner Lilly.

For discussions of recent business updates, please refer to “Part I, Item 1, Business – Business Updates” of this Annual Report on Form 10-K.

Critical Accounting Estimates

The preparation of these financial statements requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Our significant accounting policies are more fully described in “Note 1– Description of Business and Summary of Significant Accounting Policies” in the “Notes to Financial Statements” contained in “Part II, Item 8, Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. As detailed further below, we consider our critical accounting estimates to involve subjective and complex judgments, particularly regarding the estimation of allowances and discounts on product sales.

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Our revenues from product sales are recognized at net sales price when our customers obtain control of our product, which occurs at a point in time, upon delivery. Under the revenue recognition guidance, we are required to estimate the transaction price, including variable consideration that is subject to a constraint, in our contracts with our customers. Variable considerations are included in the transaction price to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Revenue from product sales is recorded net of certain variable considerations which includes estimated government-mandated rebates and chargebacks, PBM rebates, distribution fees, estimated product returns and other deductions. Provisions for sales discounts, returns and allowances are provided for in the period the related revenue is recorded. Our estimates are based on available customer and payor data received from the specialty pharmacies and distributors, as well as third-party market research data. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from our estimates, we will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known.

Recent Accounting Pronouncements

For a discussion of recent accounting pronouncements, see “Note 1– Description of Business and Summary of Significant Accounting Policies”, in the “Notes to Financial Statements” contained in “Part II, Item 8, Financial Statements and Supplementary Data” of this Annual Report on Form 10-K.

Results of Operations

Revenues

The following table summarizes revenues for the periods presented (in thousands):

The following table summarizes revenues from each of our customers who individually accounted for 10% or more of the total net product sales and revenues from collaborations:

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*Denotes less than 10%

Revenue from product sales is related to our sale of our products in the US, net of chargebacks, discounts and fees, government and other rebates and returns. Typically, our first quarter net sales are impacted by the first quarter reimbursement issues such as the resetting of co-pays and the Medicare donut hole.

TAVALISSE net product sales in 2025 was $158.8 million, increased by 52% compared to $104.8 million in 2024. The increase was primarily due to increased quantities sold, lower revenue reserves rate and higher price per bottle. REZLIDHIA net product sales in 2025 was $31.0 million, increased by 35% compared to $23.0 million in 2024. The increase was primarily due to increased quantities sold and higher price per bottle, which were partially offset by higher revenue reserves rate. Following the commercialization of GAVRETO in late June 2024, we started recognizing revenue

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from shipments to our distributors. In 2025, we recognized $42.1 million of GAVRETO net product sales, compared to $17.1 million in 2024.

Following table summarizes our revenues by collaborative partners for the periods presented (in thousands):

In 2025, contract revenues from collaborations consisted primarily of non-cash revenue of $40.0 million related to the release of cost share liability from our collaboration with Lilly. In addition, we recognized revenue from Grifols of $13.2 million related to earned royalty and delivery of drug supplies, and Kissei contributed $7.2 million in revenue - where $3.0 million was related to a milestone payment associated with the approval of fostamatinib for the treatment of chronic ITP in Korea and the balance was related to delivery of drug supplies. Further, we recognized $1.1 million of revenue from Medison related to earned royalty and delivery of drug supplies. In 2024, contract revenues from collaborations consisted primarily of revenue from Kissei of $20.4 million, $10.0 million of which was the upfront fee we received from sublicensing olutasidenib, and the remainder was related to the delivery of drug supplies. In addition, we recognized revenue from Grifols of $9.1 million related to delivery of drug supplies and earned royalty, and $4.0 million from Dr. Reddy’s related to an upfront fee from sublicensing olutasidenib.

Government contracts revenue in 2025 was related to the award granted to us by Biomedical Advanced Research and Development (BARDA), part of the Office of the Assistant Secretary for the Preparedness and Response at the DHHS, for our evaluation of fostamatinib in mitigating the impact of long-term respiratory distress. No government contracts revenue was recognized in 2024.

We expect our future revenues to include product sales of our existing commercial products and product sales from new commercial products we may have in the future. Our net product sales may be impacted by the demand from our customers, changes to government and private payor rebate programs, chargeback and discount programs, co-payment assistance programs, and any other rebate and discount programs we may enter in the future. In addition, our future revenues may include payments from our existing and new collaboration partners and government grants. As of December 31, 2025, we have deferred revenue of $1.4 million associated with our collaboration agreement with Kissei, which amount will be recognized as revenue upon satisfaction of our remaining performance obligation.

Cost of Product Sales

The following table summarizes cost of product sales for the periods presented (in thousands):

The cost of product sales includes the cost of inventories sold to our customers and to our collaborative partners. Certain inventories sold for the periods presented include inventory quantities acquired or produced prior to the FDA approval of the product, and do not reflect the full cost of the inventories sold, since such costs incurred prior to FDA approval were previously expensed and charged to research and development expense. Specifically, we have utilized zero-cost APIs for TAVALISSE, and as such, we recognized lower cost of product sales in the periods where we sold inventory quantities acquired or produced prior to the FDA approval of the product. As we acquire or produce more FDA approved inventory quantities, our inventory cost in the balance sheet and cost of product sales will reflect the full cost of acquiring or producing such products. We rely and will continue to rely on certain third parties, including those located outside the US to manufacture our products. The imposition or threat of imposition of trade policies, tariffs (including retaliatory

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tariffs), taxes and other cross-border operations could result in higher cost of product sales. Cost of product sales may also include reserves for potential

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