Stoke Therapeutics, Inc. (STOK)

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 consolidated results of operations together with the section entitled “Risk Factors” and our interim unaudited condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. You should carefully read the sections entitled “Forward-Looking Statements” and “Risk Factors” to gain an understanding of the important factors that could cause actual results to differ materially from our forward-looking statements.

Overview

We are a late-stage clinical company dedicated to addressing the underlying causes of severe diseases by upregulating protein expression with RNA-based medicines. Using our proprietary protein upregulation platform, we are developing antisense oligonucleotides (“ASOs”) to selectively restore protein levels.

Our first investigational new medicine in development, zorevunersen (STK-001), is a potential disease modifying medicine that is in late-stage clinical testing for the treatment of Dravet syndrome. Dravet syndrome is characterized by frequent, prolonged and refractory seizures beginning within the first year of life. The disease is classified as a developmental and epileptic encephalopathy (DEE) due to the developmental delays and cognitive impairment associated with it. Dravet syndrome is one of many diseases caused by a haploinsufficiency, in which a loss of approximately 50% of normal protein levels leads to disease.

Following discussions with the U.S. Food and Drug Administration (“FDA”), European Medicines Agency (“EMA”), and Japan’s Pharmaceuticals and Medical Devices Agency (“PMDA”), a global Phase 3 study, EMPEROR, was initiated in May 2025, with the first patient dosed in August 2025. This trial follows the completion of two open-label Phase 1/2a studies, MONARCH in the United States and ADMIRAL in the United Kingdom, and further evaluates the efficacy and safety of zorevunersen in children and adolescents ages 2 to up to 18 with Dravet syndrome.

In addition to the MONARCH and ADMIRAL studies, we continue to run open-label extension (“OLE”) studies in patients who completed the Phase 1/2a studies and met study entry criteria. The four studies have shown substantial and durable reductions in major motor seizure frequency when administered on top of standard of care anti-seizure medicines. In the Phase 1/2a studies, 85% of patients were taking at least three and 54% were taking at least four medicines to control seizures. Half the patients in the studies were taking concomitant fenfluramine. Ongoing treatment has led to continuous improvements in cognition and behavior through four years. Additional improvements were indicated within the first nine months of treatment among patients in the Phase 1/2a study. These improvements were observed across multiple domains of the Vineland-3 (Vineland Adaptive Behavior Scale, Third Edition), a standardized assessment of behavioral outcomes that is a key secondary endpoint for the Phase 3 study. Zorevunersen has been generally well tolerated across the studies.

In addition to our Dravet program, we are also pursuing treatment for a second haploinsufficient disease, autosomal dominant optic atrophy (“ADOA”), the most common inherited optic nerve disorder for which there are currently no approved treatments. STK-002 is our clinical candidate for the treatment of ADOA. STK-002 is designed to upregulate OPA1 protein expression by leveraging the non-mutant (wild-type) copy of the OPA1 gene to restore OPA1 protein expression with the aim to stop or slow vision loss in patients with ADOA. In a non-human primate (NHP) model of ADOA conducted in collaboration with UC Davis, treatment with STK-002 was well tolerated and helped protect, and possibly improve, eye health. The data suggest that STK-002 may help preserve the function of important vision-related nerve cells, which could potentially improve or maintain vision. We are studying STK-002 in a Phase 1 open-label study (OSPREY) of children and adults ages 6 to 55 who have an established diagnosis of ADOA and evidence of a genetic mutation in the OPA1 gene. In February 2026, we dosed the first patient with STK-002 in the OSPREY Phase 1 study for the treatment of ADOA. Dose escalation is continuing, and the study is actively recruiting in the United Kingdom and the European Union.

In July 2025, we filed a universal Shelf Registration Statement on Form S-3 (the “2025 Registration Statement”) with the SEC. The 2025 Registration Statement was declared effective by the SEC on July 11, 2025, and contains two prospectuses: a base prospectus, which covers the offering, issuance and sale by us of up to a maximum aggregate offering price of $400.0 million of our common stock, preferred stock, debt securities, warrants to purchase common stock, preferred stock or debt securities, subscription rights to purchase common stock, preferred stock or debt securities and/or units consisting of some or all of these securities; and a sales agreement prospectus covering the offering, issuance and sale by us of up to a maximum aggregate offering price of $150.0 million of common stock that may be issued and sold under a Controlled Equity Offering Sales Agreement (the “Sales Agreement”). We do not intend to make any further offers or sales of our common stock pursuant to the Sales Agreement under the 2025 Registration Statement.

In March 2026, we filed an automatic universal Shelf Registration Statement on Form S-3 (the “2026 Registration Statement”) with the SEC. The 2026 Registration Statement contains two prospectuses: a base prospectus, which covers the offering, issuance and sale

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by us of our common stock, preferred stock, debt securities, warrants to purchase common stock, preferred stock or debt securities, subscription rights to purchase common stock, preferred stock or debt securities and/or units consisting of some or all of these securities; and a sales agreement prospectus covering the offering, issuance and sale by us of up to a maximum aggregate offering price of $150.0 million of our common stock that may be issued and sold under the Sales Agreement. The specific terms of any securities to be offered pursuant to the base prospectus will be specified in a prospectus supplement to the base prospectus. We intend to use the 2026 Registration Statement for any future issuances and sales of common stock.

As of December 31, 2025, we had issued approximately 3.2 million shares of common stock pursuant to the 2025 Registration Statement for net proceeds of $87.8 million. In addition, as of June 30, 2026, we had issued approximately 2.6 million shares of common stock pursuant to the Sales Agreement and the 2026 Registration Statement for net proceeds of $80.7 million. Since June 30, 2026, through the issuance of these condensed consolidated financial statements, we sold approximately 2.1 million shares of our common stock pursuant to the Sales Agreement and the 2026 Registration Statement for net proceeds of $65.7 million after deducting commissions. We may terminate this at-the-market program under the Sales Agreement at any time, pursuant to its terms.

As of June 30, 2026 and December 31, 2025 we had $354.3 million and $390.9 million, respectively, in cash, cash equivalents and marketable securities.

Since inception, we have had operating losses, the majority of which are attributable to research and development activities. Our net losses were $61.6 million and $23.5 million for the three months ended June 30, 2026 and 2025, respectively. For the six months ended June 30, 2026 we had a net loss of $111.6 million and for the six months ended June 30, 2025 we had net income of $89.4 million. As of June 30, 2026, we had an accumulated deficit of $609.3 million.

Our primary use of cash is to fund operating expenses, which consist primarily of research and development activities, including medical affairs, as well as sales, general and administrative expenses, including commercial operations. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in our outstanding accounts payable and accrued expenses. We expect to continue to incur net losses for the foreseeable future, and we expect our research and development expenses, sales, general and administrative expenses will continue to increase. In particular, we expect our expenses and losses to increase as we continue our development of, and seek regulatory approvals for, our product candidates, and begin to commercialize any approved products. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical trials and our expenditures on other research and development activities.

Based on our current operating plan, we believe that our cash, cash equivalents, and marketable securities of approximately $354.3 million as of June 30, 2026 and additional proceeds from the ATM sale of $65.7 million, will fund operations through to potential U.S. commercialization of zorevunersen in early 2028. To date, we have not had any products approved for sale and have not generated any product sales. We do not expect to generate any revenues from product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our product candidates. If we obtain regulatory approval for any of our product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution. As a result, until such time, if ever, as we can generate substantial product revenue, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, including potentially collaborations, licenses and other similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. Any failure to raise capital as and when needed could have a negative impact on our financial condition and on our ability to pursue our business plans and strategies. If we are unable to raise capital, we will need to delay, reduce or terminate planned activities to reduce costs.

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Program Update

Dravet Syndrome Program – zorevunersen

Presentations of new clinical data for zorevunersen at medical congresses have contributed to greater understanding of its disease-modifying potential that is highly differentiated from any currently available treatments. The Company will continue its educational efforts at major neurology and epilepsy congresses during the second half of 2026. Analyses of data from the ongoing OLEs will support efforts to increase clinician understanding of zorevunersen while the Phase 3 EMPEROR study advances toward completion and the Company prepares for a potential U.S. approval and launch. The Company will also continue discussions with the FDA to update the Agency on its long-term data for zorevunersen.

EMPEROR is a global, pivotal Phase 3 study. In June 2026, we announced completion of enrollment of 162 patients in the U.S., UK, and Japan, where patients are randomized to treatment with zorevunersen or a sham control administered via lumbar puncture (LP). A Phase 3 data readout is anticipated in the third quarter of 2027 to complete the planned rolling U.S. NDA submission in the second half of 2027. Commercial preparation is underway to support a potential U.S. commercial launch of zorevunersen in early 2028.

An

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Item 7. 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 consolidated results of operations together with our consolidated financial statements and related notes appearing elsewhere in this Annual Report on Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. You should carefully read the sections entitled “Risk Factors” and “Special Note Regarding Forward-Looking Statements” to gain an understanding of the important factors that could cause actual results to differ materially from our forward-looking statements.

Overview

We are a late-stage clinical company dedicated to addressing the underlying causes of severe diseases by upregulating protein expression with RNA-based medicines. Using our proprietary TANGO (Targeted Augmentation of Nuclear Gene Output) approach, we are developing antisense oligonucleotides (“ASOs”) to selectively restore protein levels.

Our first investigational new medicine in development, zorevunersen (STK-001), is a potential disease modifying medicine that is in late-stage clinical testing for the treatment of Dravet syndrome. Dravet syndrome is characterized by frequent, prolonged and refractory seizures beginning within the first year of life. The disease is classified as a developmental and epileptic encephalopathy (DEE) due to the developmental delays and cognitive impairment associated with it. Dravet syndrome is one of many diseases caused by a haploinsufficiency, in which a loss of approximately 50% of normal protein levels leads to disease.

Following discussions with the U.S. Food and Drug Administration (“FDA”), European Medicines Agency (“EMA”), and Japan’s Pharmaceuticals and Medical Devices Agency (“PMDA”), a global Phase 3 study, EMPEROR, was initiated in May 2025, with the first patient dosed in August 2025. This trial follows the completion of two open-label Phase 1/2a studies, MONARCH in the United States and ADMIRAL in the United Kingdom, and further evaluates the efficacy and safety of zorevunersen in children and adolescents ages 2 to up to 18 with Dravet syndrome.

In addition to the MONARCH and ADMIRAL studies, we continue to run open-label extension (“OLE”) studies in patients who completed the Phase 1/2a studies and met study entry criteria. The four studies have shown substantial and durable reductions in convulsive seizure frequency when administered on top of standard of care anti-seizure medicines. In the Phase 1/2a studies, 85% of patients were taking at least three and 54% were taking at least four medicines to control seizures. Half the patients in the studies were taking concomitant fenfluramine. Ongoing treatment has led to continuous improvements in cognition and behavior through three years. Additional improvements were indicated within the first nine months of treatment among patients in the Phase 1/2a study. These improvements were observed across multiple domains of the Vineland-3 (Vineland Adaptive Behavior Scale, Third Edition), a standardized assessment of behavioral outcomes that is a key secondary endpoint for the Phase 3 study. Zorevunersen has been generally well tolerated across the studies.

In addition to our Dravet program, we are also pursuing treatment for a second haploinsufficient disease, autosomal dominant optic atrophy (“ADOA”), the most common inherited optic nerve disorder for which there are currently no approved treatments. STK-002 is our clinical candidate for the treatment of ADOA. STK-002 is designed to upregulate OPA1 protein expression by leveraging the non-mutant (wild-type) copy of the OPA1 gene to restore OPA1 protein expression with the aim to stop or slow vision loss in patients with ADOA. In a non-human primate (NHP) model of ADOA conducted in collaboration with UC Davis, treatment with STK-002 was well tolerated and helped protect, and possibly improve, eye health. The data suggest that STK-002 may help preserve the function of important vision-related nerve cells, which could potentially improve or maintain vision. We received authorization in the UK to proceed with a Phase 1 open-label study (OSPREY) of children and adults ages 6 to 55 who have an established diagnosis of ADOA and have evidence of a genetic mutation in the OPA1 gene. In February 2026, we dosed the first patient with STK-002 in the OSPREY Phase 1 study for the treatment of ADOA.

In terms of our liquidity and capital resources, in May 2022, we filed a universal Shelf Registration statement on Form S-3 (the “2022 Registration Statement”) with the SEC. The 2022 Registration Statement was declared effective by the SEC on May 31, 2022, and contained two prospectuses: a base prospectus, which covered the offering, issuance and sale by us of up to a maximum aggregate offering price of $400.0 million of our common stock, preferred stock, debt securities, warrants to purchase common stock, preferred stock or debt securities, subscription rights to purchase common stock, preferred stock or debt securities and/or units consisting of some or all of these securities; and a sales agreement prospectus covering the offering, issuance and sale by us of up to a maximum aggregate offering price of $150.0 million of common stock that may be issued and sold under a Controlled Equity Offering Sales Agreement (the “Sales Agreement”).

On April 2, 2024, we completed an underwritten public offering, pursuant to the 2022 Registration Statement, of 5,555,557 shares of common stock at a public offering price of $13.50 per share and issued pre-funded warrants to purchase

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3,703,730 shares of common stock at a public offering price of $13.499 per share subject to an exercise price equal to $0.0001. The common stock and pre-funded warrants sold resulted in net proceeds of approximately $119.9 million after deducting underwriting discounts, commissions and offering costs. No pre-funded warrants have been exercised as of December 31, 2025.

In October 2024, we filed an automatic universal Shelf Registration statement on Form S-3 (the “2024 Registration Statement”) with the SEC. Following the filing of our Annual Report on Form 10-K for the year ended December 31, 2024 in March 2025, the 2024 Registration Statement became ineffective.

In July 2025, we filed a universal Shelf Registration Statement on Form S-3 (the “2025 Registration Statement”) with the SEC. The 2025 Registration Statement was declared effective by the SEC on July 11, 2025, and contains two prospectuses: a base prospectus, which covers the offering, issuance and sale by us of up to a maximum aggregate offering price of $400.0 million of our common stock, preferred stock, debt securities, warrants to purchase common stock, preferred stock or debt securities, subscription rights to purchase common stock, preferred stock or debt securities and/or units consisting of some or all of these securities; and a sales agreement prospectus covering the offering, issuance and sale by us of up to a maximum aggregate offering price of $150.0 million of common stock that may be issued and sold under the Sales Agreement. The specific terms of any securities to be offered pursuant to the base prospectus will be specified in a prospectus supplement to the base prospectus.

As of December 31, 2025, we had issued approximately 7.0 million shares of common stock pursuant to the Sales Agreement for net proceeds of $61.0 million pursuant to the 2022 Registration Statement. As of December 31, 2025, we had issued approximately 3.2 million shares of common stock pursuant to the 2025 Registration Statement for net proceeds of $87.8 million. We may terminate this at-the-market program under the Sales Agreement at any time, pursuant to its terms.

As of December 31, 2025 and December 31, 2024 we had $390.9 million and $246.7 million, respectively, in cash, cash equivalents and marketable securities.

Since inception, we have had operating losses, the majority of which are attributable to research and development activities. Our net losses were $6.9 million and $89.0 million for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, we had an accumulated deficit of $497.7 million.

Our primary use of cash is to fund operating expenses, which consist primarily of research and development activities, including medical affairs, as well as sales, general and administrative expenses, including commercial operations. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in our outstanding accounts payable and accrued expenses. We expect to continue to incur net losses for the foreseeable future, and we expect our research and development expenses, sales, general and administrative expenses will continue to increase. In particular, we expect our expenses and losses to increase as we continue our development of, and seek regulatory approvals for, our product candidates, and begin to commercialize any approved products. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical trials and our expenditures on other research and development activities.

Based upon our current operating plan, we believe that our cash, cash equivalents, and marketable securities of approximately $390.9 million as of December 31, 2025, will fund operations into 2028. To date, we have not had any products approved for sale and have not generated any product sales. We do not expect to generate any revenues from product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our product candidates. If we obtain regulatory approval for any of our product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution. As a result, until such time, if ever, as we can generate substantial product revenue, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, including potentially collaborations, licenses and other similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. Any failure to raise capital as and when needed could have a negative impact on our financial condition and on our ability to pursue our business plans and strategies. If we are unable to raise capital, we will need to delay, reduce or terminate planned activities to reduce costs.

Financial Operations Overview

Revenue

We are comprised of one reportable segment and as of December 31, 2025 and 2024, have not generated any product revenue since inception, as we do not yet have approved products for sale. If we are able to successfully develop, receive regulatory approval for and commercialize any of our current or future product candidates alone or in collaboration with third parties, we may generate revenue from the sales of these product candidates.

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In January 2022, we entered into a License and Collaboration Agreement (the “Acadia Agreement”) with Acadia Pharmaceuticals Inc. (“Acadia”) for the discovery, development and commercialization of novel RNA-based medicines for the treatment of severe and rare genetic neurodevelopmental diseases of the central nervous system. The Acadia Agreement focused on the targets SYNGAP1, MECP2 (Rett syndrome), and an undisclosed neurodevelopmental target of mutual interest. In connection with each target, we agreed to collaborate with Acadia to identify potential treatments for further development and commercialization as li

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