Compass Therapeutics Inc.

Company Overview

Business Model: Compass Therapeutics, Inc. is a clinical-stage, oncology-focused biopharmaceutical company dedicated to developing proprietary antibody-based therapeutics for multiple human diseases. The company's scientific focus centers on the interplay between angiogenesis, the immune system, and tumor growth. Its pipeline of novel product candidates is designed to target critical biological pathways, including modulating microvasculature via angiogenesis-targeted agents, inducing potent immune responses through effector cell activators in the tumor microenvironment, and alleviating immunosuppressive mechanisms employed by tumors. The strategy involves advancing product candidates through clinical development and commercialization as standalone therapies and in combination with proprietary pipeline antibodies, supported by clinical and nonclinical data. The company may also pursue strategic partnerships for select product candidates and leverages its StitchMabs TMplatform for research and discovery.

Market Position: Compass Therapeutics, Inc. is an early-stage company with no products approved for commercial sale and a history of significant net losses. Its pipeline includes four clinical-stage product candidates. The lead candidate, tovecimig, is in a randomized Phase 2/3 trial for biliary tract cancer (BTC). CTX-471, an agonistic antibody, has shown monotherapy activity in post-PD-1/PD-L1 patients across melanoma, small cell lung cancer, and mesothelioma, with a potential biomarker identified. CTX-8371, a bispecific antibody, has demonstrated deep responses in early clinical trials for non-small cell lung cancer, triple-negative breast cancer, and Hodgkin lymphoma, with preclinical data suggesting enhanced immune activation over single checkpoint inhibitors. CTX-10726, another bispecific antibody, has initiated Phase 1 development, showing potent PD-1 blockade in preclinical studies. The company operates in a highly competitive biotechnology and pharmaceutical industry, facing larger, better-funded biopharmaceutical companies such as AbbVie, Amgen, Inc., AstraZeneca plc, Bristol-Myers Squibb Company, Eli Lilly, Genentech, Inc., GlaxoSmithKline PLC, Johnson & Johnson, Merck & Co., Inc., Merck KGaA, Novartis AG, Pfizer Inc., Roche Holding Ltd and Sanofi S.A., as well as smaller entities and academic institutions. The target markets, such as BTC (estimated 26,500 newly diagnosed patients in the US annually, over 200,000 worldwide) and colorectal cancer (second most common cause of cancer deaths in the US), represent areas of significant unmet medical need with limited existing treatment options in later lines of therapy.

Recent Strategic Developments:

• tovecimig (BTC): The randomized Phase 2/3 trial in the United States for biliary tract cancer (second-line setting) met its primary endpoint in April 2025, demonstrating an overall response rate (ORR) of 17.1% (including one complete response) for tovecimig in combination with paclitaxel, compared to 5.3% for paclitaxel alone (p=0.031). Analyses of progression-free survival (PFS) and overall survival (OS) are expected in April 2026. An Investigator Sponsored Trial (IST) for front-line BTC, combining tovecimig with gemcitabine, cisplatin, and durvalumab, was initiated in Q1 2025.
• tovecimig (CRC): In January 2026, data from a Phase 2 monotherapy study in advanced, metastatic colorectal cancer (third- and fourth-line settings) showed a 5% ORR (2 out of 40 patients), a disease control rate (DCR) of 68%, median PFS of 3.9 months, and median OS of 10.2 months in heavily pre-treated patients.
• CTX-471: In November 2024, novel biomarker data associated with CTX-471 were presented, correlating neural cell adhesion molecule (NCAM or CD56) levels in baseline tumor biopsies with disease control. A Phase 2 basket study of CTX-471 in patients with NCAM+ tumors is expected to initiate mid-2026.
• CTX-8371: A first-in-human Phase 1 clinical trial, initiated in Q1 2024, demonstrated 3 confirmed responses out of 15 patients across non-small cell lung cancer, triple-negative breast cancer, and Hodgkin lymphoma, with no dose limiting toxicities. Cohort expansions for non-small cell lung cancer and triple-negative breast cancer are currently enrolling, with a Hodgkin lymphoma expansion cohort expected to begin shortly. Initial data from these expansions and the dose-escalation portion are expected in H1 2026.
• CTX-10726: Received FDA clearance for its Investigational New Drug (IND) application in Q1 2026, and a Phase 1 dose escalation study was initiated in Q1 2026.
• Financing: In August 2025, the company completed an underwritten public offering, raising aggregate net proceeds of $129.3 million. In December 2025, a new At-The-Market (ATM) offering agreement was entered into with Leerink Partners LLC and Cantor Fitzgerald & Co, replacing a prior agreement with Jefferies LLC.

Geographic Footprint: Compass Therapeutics, Inc.'s principal executive offices are located in Boston, Massachusetts, United States. Clinical development activities for its lead product candidates are primarily conducted in the United States. Tovecimig's early-stage clinical trials were completed in South Korea, and the company holds exclusive global rights to tovecimig (excluding South Korea), licensed from ABL Bio, Inc. South Korean rights are held by Handok Pharmaceuticals, Inc., and China rights were out-licensed to Elpiscience Biopharmaceuticals Co., Limited.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Compass Therapeutics, Inc. has not generated revenue from product sales and has incurred significant operating losses since inception.
• Net Loss for the year ended December 31, 2025, was $66.5 million, compared to $49.4 million in 2024.
• The accumulated deficit as of December 31, 2025, was $431 million.

Investment in Growth:

• R&D Expenditure: $56.0 million in 2025, an increase of $13.6 million (+32.2%) from $42.3 million in 2024. This increase was primarily driven by $14.2 million in manufacturing expenses related to tovecimig and CTX-10726.
• Capital Expenditures: $0.025 million in 2025, compared to $0.044 million in 2024.
• Strategic Investments: The primary investment in growth is through research and development activities and licensing agreements for product candidates.

Key Program Spending (R&D Expenses)

Compass Therapeutics, Inc. operates as one segment, with R&D expenses tracked by major program.

tovecimig (DLL4 X VEGF-A bispecific antibody)

Financial Performance: R&D expenditure for tovecimig was $25.3 million in 2025, a decrease of $2.7 million from $27.9 million in 2024. Product Portfolio: Tovecimig is an investigational bispecific antibody designed to simultaneously block the Delta-like ligand 4 (DLL4) and vascular endothelial growth factor A (VEGF-A) signaling pathways, which are critical for angiogenesis and tumor vascularization. Recent Developments:

• Randomized Phase 2/3 trial in the United States for second-line biliary tract cancer (BTC) in combination with paclitaxel met its primary endpoint in April 2025, showing an ORR of 17.1% (including one complete response) versus 5.3% for paclitaxel alone (p=0.031). Progression-free survival (PFS) and overall survival (OS) analyses are expected in April 2026.
• An Investigator Sponsored Trial (IST) for front-line BTC, combining tovecimig with gemcitabine, cisplatin, and durvalumab, was initiated in Q1 2025.
• Phase 2 monotherapy study in advanced, metastatic colorectal cancer (CRC) in third- and fourth-line settings showed a 5% ORR (2 out of 40 patients), a 68% Disease Control Rate (DCR), median PFS of 3.9 months, and median OS of 10.2 months (data presented January 2026). Market Dynamics: The company estimates approximately 26,500 patients are newly diagnosed with BTC in the United States each year, and over 200,000 worldwide. Patients with BTC have a poor prognosis, and there is no generally accepted standard of care in later lines of treatment, except for therapies addressing targeted mutations (estimated 15% to 20% of the patient population). The company intends to expand tovecimig's development to additional solid tumor indications such as ovarian cancer, gastric cancer, renal cell carcinoma, and hepatocellular carcinoma. Licensing: Compass Therapeutics, Inc. has licensed exclusive global rights to tovecimig, outside of South Korea, from ABL Bio, Inc. South Korean rights are held by Handok Pharmaceuticals, Inc., and China rights were out-licensed to Elpiscience Biopharmaceuticals Co., Limited.

CTX-471 (CD137 or 4-1BB agonist antibody)

Financial Performance: R&D expenditure for CTX-471 was $8.2 million in 2025, an increase of $3.3 million (+67.3%) from $4.9 million in 2024. Product Portfolio: CTX-471 is a fully human, IgG4 monoclonal antibody that acts as an agonist of CD137 (also known as 4-1BB), a key co-stimulatory receptor on immune cells. It is designed to lead to ligand-stimulated activation of T-cells and NK cells. The antibody's antigenic site recognized by CTX-471 is differentiated from competitors' CD137 antibodies. Recent Developments:

• A Phase 1b monotherapy study in patients with solid tumors who had progressed after PD-1 or PD-L1 immune checkpoint inhibitors enrolled 60 patients across 17 different cancers. Initial results reported five clinical responses, including a durable partial response (PR) in a patient with small cell lung cancer (SCLC) that converted to a complete response (CR), and four additional PRs (three confirmed, one unconfirmed) in patients with melanoma (3 out of 11 patients, 27% ORR) and mesothelioma (1 out of 4 patients).
• In November 2024, the company presented novel biomarker data demonstrating a correlation between neural cell adhesion molecule (NCAM or CD56) levels in baseline tumor cell biopsies and disease control in patients treated with CTX-471.
• A Phase 2 basket study of CTX-471 in patients with NCAM+ tumors is expected to initiate mid-2026. Market Dynamics: CTX-471 aims to be a next-generation immune-oncology treatment for patients across various cancers who do not have a sustained response to current therapies.

CTX-8371 (PD-1 x PD-L1 Bispecific Antibody)

Financial Performance: R&D expenditure for CTX-8371 was $4.8 million in 2025, an increase of $1.3 million (+37.1%) from $3.5 million in 2024. Product Portfolio: CTX-8371 is a bispecific antibody that binds to both PD-1 and PD-L1, two validated immune-oncology targets. It emerged from an unbiased screen for synergy conducted with the company's StitchMabs TMplatform. Recent Developments:

• A first-in-human Phase 1 clinical trial, initiated in Q1 2024, demonstrated 3 confirmed responses out of 15 patients in the dose escalation portion, across non-small cell lung cancer (NSCLC), triple-negative breast cancer (TNBC), and Hodgkin lymphoma (HL), with no dose limiting toxicities observed.
• Cohort expansions are now enrolling patients with TNBC (n=28) and NSCLC (n=28), with an expansion cohort in HL (n=12) expected to begin shortly, all in the post-checkpoint inhibitor setting.
• Initial data from these cohort expansions and the Phase 1 dose-escalation study are expected to be presented in H1 2026. Market Dynamics: The company believes CTX-8371 has the potential to become a next-generation checkpoint inhibitor with improved activity across various solid tumors relative to approved checkpoint blockers. Preclinical studies showed enhanced activation of immune responses and significantly greater tumor growth control and longer survival compared to single PD-1 inhibitors, PD-L1 inhibitors, or their combination.

CTX-10726 (PD-1 x VEGF-A Bispecific Antibody)

Financial Performance: R&D expenditure for CTX-10726 was $10.2 million in 2025, marking its first year with reported spending. Product Portfolio: CTX-10726 is a novel, tetravalent PD-1 x VEGF-A bispecific antibody, discovered, engineered, and developed in-house. It is a fully human IgG1 with silenced Fc-γ receptor binding. Recent Developments:

• Received FDA clearance for its IND in Q1 2026.
• A Phase 1 dose escalation study was initiated in Q1 2026, enrolling patients with locally advanced, unresectable or metastatic malignancies, including renal cell carcinoma, gastroesophageal cancer, hepatocellular carcinoma, and endometrial cancer, in whom standard of care therapies have failed. Market Dynamics: CTX-10726 is designed to synergistically deliver VEGF-A blockade and checkpoint inhibition, potentially applicable to multiple solid tumor indications. Preclinical studies indicate several-fold more potent PD-1 blockade compared with publicly available data for other drugs in the class.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: Not disclosed.
• Dividend Payments: Compass Therapeutics, Inc. has never declared or paid cash dividends on its common stock and does not intend to do so in the foreseeable future.
• Future Capital Return Commitments: No specific commitments for future capital returns were disclosed.

Balance Sheet Position (as of December 31, 2025):

• Cash and Equivalents: $30.6 million
• Total Marketable Securities: $178.3 million
• Net Cash Position: $209 million (Cash, cash equivalents and marketable securities)
• Total Debt: The company has operating lease obligations totaling $9.8 million ($1.0 million current portion, $8.8 million long-term portion). No other material debt was disclosed.
• Credit Rating: Not disclosed.
• Debt Maturity Profile: Operating lease commitments include payments of $1.5 million in less than 1 year, $4.5 million in 1 to 3 years, $4.6 million in 3 to 5 years, and $1.0 million in more than 5 years.

Cash Flow Generation (Year Ended December 31, 2025):

• Operating Cash Flow: $(49.1) million (cash used in operating activities).
• Free Cash Flow: $(49.125) million (Operating Cash Flow of $(49.1) million minus Capital Expenditures of $0.025 million).
• Cash Conversion Metrics: Not explicitly disclosed.

Operational Excellence

Production & Service Model: Compass Therapeutics, Inc. does not own or operate manufacturing facilities for the production of clinical quantities of its product candidates. The company relies on qualified third-party Contract Development Manufacturing Organizations (CDMOs) to produce clinical supplies for its trials. For potential commercial quantities, if approved, the company expects to continue relying on third parties, with manufacturing facilities and processes required to comply with FDA and other regulations, including current Good Manufacturing Practices (cGMP).

Supply Chain Architecture: Key Suppliers & Partners:

• Contract Development Manufacturing Organizations (CDMOs): Qualified third-party CDMOs are utilized for manufacturing product candidates for preclinical and clinical trials.
• Contract Research Organizations (CROs): Third-party CROs, medical institutions, and clinical investigators are relied upon to conduct GLP-compliant preclinical studies and cGCP-compliant clinical trials.
• ABL Bio, Inc.: The original licensor of tovecimig, granting exclusive global rights (excluding South Korea) to Compass Therapeutics, Inc.
• Adimab, LLC: A collaboration agreement with Adimab, LLC provides a license for certain antibodies, including CTX-471.
• Handok Pharmaceuticals, Inc.: Holds the South Korean rights for tovecimig.
• Elpiscience Biopharmaceuticals Co., Limited: Holds the China rights for tovecimig through an out-licensing agreement.
• The University of Texas MD Anderson Cancer Center: Leading an Investigator Sponsored Trial for tovecimig.

Facility Network:

• Corporate Headquarters: The company's corporate headquarters is located at 80 Guest Street, Boston, Massachusetts, consisting of 29,836 square feet of office and laboratory space under a lease agreement that expires in May 2031.
• Manufacturing: Relies on third-party CDMOs.
• Research & Development: Conducted internally and through third-party contract laboratories and CROs.

Operational Metrics: Specific operational metrics such as capacity utilization or detailed efficiency measures were not explicitly disclosed in the filing.

Market Access & Customer Relationships

Go-to-Market Strategy: Distribution Channels: Compass Therapeutics, Inc. holds worldwide rights to all its product candidates, with the exception of limited countries for tovecimig. This provides the flexibility to either independently pursue commercialization in major geographies by building an internal sales and marketing organization or to seek collaborations with third parties possessing established commercialization infrastructure.

Customer Portfolio: Enterprise Customers: As a clinical-stage company, Compass Therapeutics, Inc. does not currently have commercialized products or enterprise customers. Its focus is on developing therapies for patients with specific cancer types, including biliary tract cancer, colorectal cancer, melanoma, small cell lung cancer, mesothelioma, non-small cell lung cancer, triple-negative breast cancer, Hodgkin lymphoma, renal cell carcinoma, gastroesophageal cancer, hepatocellular carcinoma, and endometrial cancer. Customer Concentration: Not applicable due to the absence of commercialized products.

Geographic Revenue Distribution: The company has not generated product sales revenue. In 2024, it recognized $0.85 million in licensing revenue from Elpiscience Biopharmaceuticals Co., Limited, which holds the China rights for tovecimig.

Competitive Intelligence

Market Structure & Dynamics

Industry Characteristics: The biotechnology and pharmaceutical industries, particularly the immuno-oncology subsector, are characterized by rapid technological evolution, intense competition, and robust intellectual property defense. The market for biliary tract cancer (BTC) is estimated at approximately 26,500 newly diagnosed patients in the United States annually and over 200,000 worldwide, with a poor prognosis and limited standard of care in later lines of treatment. Colorectal cancer (CRC) is the second most common cause of cancer deaths in the United States, accounting for approximately 10% of all annually diagnosed cancer and cancer-related deaths globally, with limited approved therapies for advanced metastatic disease.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors: Compass Therapeutics, Inc. faces significant competition from larger, better-funded biopharmaceutical and biotechnology companies, including AbbVie, Amgen, Inc., AstraZeneca plc, Bristol-Myers Squibb Company, Eli Lilly, Genentech, Inc., GlaxoSmithKline PLC, Johnson & Johnson, Merck & Co., Inc., Merck KGaA, Novartis AG, Pfizer Inc., Roche Holding Ltd and Sanofi S.A. Additionally, smaller and earlier-stage companies, universities, and research institutions are also developing cancer therapeutics.

• Currently Marketed Oncology Drugs: Competitors include traditional cancer therapies (chemotherapy, radiation), antibody-drug conjugates (e.g., Genentech, Inc.'s Kadcyla), immune checkpoint inhibitors targeting CTLA-4 (e.g., Bristol-Myers Squibb Company's Yervoy) and PD-1/PD-L1 (e.g., Bristol-Myers Squibb Company's Opdivo, Merck & Co., Inc.'s Keytruda, Genentech, Inc.'s Tecentriq), T cell-engager immunotherapies (e.g., Amgen, Inc.'s Blincyto), and VEGF targets (e.g., Genentech, Inc.'s Avastin).
• Biliary Tract Cancer (BTC): First-line treatments include gemcitabine and cisplatin, often combined with PD-L1 inhibitor Imfinzi (durvalumab) by AstraZeneca plc or PD-1 inhibitor Keytruda (pembrolizumab) by Merck & Co., Inc. Second-line options are limited to targeted therapies for specific tumor mutations (e.g., Jazz Pharmaceuticals' Ziihera for HER2+ BTC), which benefit only 10-15% of patients.
• Colorectal Cancer (CRC): First-line treatment typically involves the VEGF inhibitor Avastin (bevacizumab) by Genentech, Inc. or an EGFR inhibitor such as Erbitux (cetuximab), combined with chemotherapy. Approved therapies for advanced metastatic disease, such as Lonsurf (trifluridine and tipiracil) and Stivarga (regorafenib), offer limited response rates (1-2%) and survival improvement (1-2 months).

Emerging Competitive Threats: Numerous compounds are in clinical development for cancer treatment. Competitors may achieve regulatory approval more rapidly or secure intellectual property rights that could limit Compass Therapeutics, Inc.'s ability to develop or commercialize its product candidates. New therapies may emerge that are safer, more effective, more convenient, have fewer side effects, broader labels, are more effectively marketed, reimbursed, or less expensive.

Competitive Response Strategy: Compass Therapeutics, Inc. aims to maintain its competitive advantage by focusing on its proprietary antibody-based therapeutics, advancing its product candidates as both standalone and combination therapies, leveraging its StitchMabs TMplatform, and selectively pursuing strategic partnerships.

Risk Assessment Framework

Strategic & Market Risks

Market Dynamics:

• Limited Operating History & Profitability: Compass Therapeutics, Inc. has a limited operating history, no products approved for commercial sale, and an accumulated deficit of $431 million as of December 31, 2025. It expects to incur significant losses for the foreseeable future and may never achieve profitability.
• Substantial Additional Financing Required: The company's operations consume substantial cash. Existing cash, cash equivalents, and marketable securities of $209 million as of December 31, 2025, are expected to fund operations into 2028. Significant additional funding will be required to complete clinical development and commercialization, which may not be available on acceptable terms or at all, potentially forcing delays or termination of development programs.
• Competition: The biotechnology and pharmaceutical industries are intensely competitive. Competitors, many with significantly greater resources, may develop and commercialize products that are safer, more effective, or less costly, or obtain regulatory approvals and patent protection more rapidly, thereby reducing or eliminating Compass Therapeutics, Inc.'s commercial opportunity.
• Market Acceptance: Even if a product candidate receives marketing approval, it may fail to achieve sufficient market acceptance by physicians, patients, and third-party payors, particularly given the entrenchment of existing therapies and the novelty of some of the company's approaches.
• Limited Market Opportunities: The market opportunities for approved product candidates may be limited to specific patient populations (e.g., second- or third-line therapies), potentially restricting revenue generation if target populations are smaller than estimated.
• Global Pandemics: Health epidemics could adversely affect business operations, including clinical trial sites and third-party operations, leading to significant disruptions.

Technology Disruption:

• Uncertainty of New Therapeutic Class: The company's bispecific and monoclonal antibody technology is relatively new, making development time and cost difficult to predict. Agonist antibodies have demonstrated substantial toxicity in humans, and there is no assurance that the company's product candidates will not have similar adverse side effects.
• Preclinical Development Uncertainty: Preclinical programs carry a high risk of failure and may never advance to clinical trials. Positive results from preclinical studies and early-stage clinical trials may not be predictive of future results in later-stage or larger trials.
• Interim Data Reliability: Interim and preliminary clinical trial results are subject to change as more data become available and may not be predictive of final outcomes, potentially causing significant fluctuations in stock price.

Operational & Execution Risks

Supply Chain Vulnerabilities:

• Dependence on Third-Party Manufacturers: Compass Therapeutics, Inc. relies entirely on qualified third-party Contract Development Manufacturing Organizations (CDMOs) for manufacturing product candidates. The loss of these partners or their failure to comply with regulatory requirements (cGMP), supply sufficient quantities, or maintain acceptable quality levels could materially and adversely affect the business.
• Manufacturing Process Changes: Changes in manufacturing methods or formulation as product candidates advance through development may result in additional costs, delays, or require further testing and regulatory approvals.
• Contamination Risk: The manufacturing of biological products carries a risk of contamination, which could disrupt production, harm results of operations, and cause reputational damage.

Geographic Concentration:

• Overseas Clinical Trials: Conducting clinical trials in overseas jurisdictions exposes the company to delays and expenses due to differing regulatory and administrative requirements, foreign exchange fluctuations, manufacturing and customs issues, and cultural differences in medical practice.

Financial & Regulatory Risks

Market & Financial Risks:

• Capital Market Volatility: Recent volatility in capital markets and lower market prices for securities may affect the company's ability to access new capital through equity or debt financings, potentially harming liquidity and limiting business growth.
• Product Liability Lawsuits: The company faces an inherent risk of product liability exposure from clinical trials and potential commercialization, which could lead to substantial liabilities, decreased demand, and significant legal costs.
• Reimbursement and Pricing: Commercial success depends on third-party payor coverage and adequate reimbursement levels. Failure to obtain or maintain favorable coverage and reimbursement policies could limit marketability and revenue.
• Healthcare Reform Legislation: Enacted and future healthcare reform legislation (e.g., the Inflation Reduction Act of 2022, recent Executive Orders, and CMS proposals like GLOBE, GUARD, and GENEROUS models) could increase commercialization costs, impact drug pricing, and reduce demand for products.
• Net Operating Loss (NOL) Limitations: The ability to utilize federal and state NOL carryforwards and research and development tax credits may be limited by "ownership changes" as defined under Sections 382 and 383 of the Internal Revenue Code.
• Tax Law Changes: Changes in U.S. federal, state, and local income tax laws could adversely affect the business and financial condition.

Regulatory & Compliance Risks:

• Lengthy and Unpredictable Regulatory Approval: The regulatory approval processes of the FDA and comparable foreign authorities are lengthy, time-consuming, and inherently unpredictable. Failure to obtain regulatory approval for product candidates would materially harm the business.
• Ongoing Regulatory Obligations: Any marketing approvals received will be subject to extensive and ongoing regulatory requirements, including post-market testing, surveillance, and compliance with cGMP and cGCP. Failure to comply could result in significant penalties, product withdrawal, or restrictions.
• Accelerated Approval Risks: While accelerated approval may be sought, it does not guarantee faster development or traditional approval and typically requires costly post-marketing confirmatory trials.
• Combination Therapy Regulatory Risks: Developing product candidates in combination with other therapies exposes the company to additional regulatory risks, such as failure to demonstrate synergistic activity, safety issues, or the revocation of approval for the combination partner.
• Government Agency Disruptions: Disruptions at the FDA and other government agencies due to funding shortages or global health concerns could delay product development, review, and approval.
• Clinical Trial Compliance: Clinical trials must adhere to cGCP and GLP requirements. Non-compliance, negative or inconclusive results, or poorly designed trials could lead to suspension, termination, or delays.
• Anti-Kickback, Fraud, and Abuse Laws: Relationships with healthcare providers, physicians, and third-party payors are subject to complex anti-kickback, fraud, and abuse laws, violations of which could lead to criminal sanctions, civil penalties, and reputational harm.
• Cybersecurity and Data Privacy: Dependence on information technology systems and the handling of sensitive data expose the company to cybersecurity incidents, data breaches, and compliance risks under various U.S. (e.g., HIPAA, CCPA, CPRA, My Health My Data Act) and foreign (e.g., GDPR) privacy laws.
• AI Technology Risks: The use of new and evolving technologies, such as artificial intelligence, may present cybersecurity risks, require significant resources for compliance with evolving regulations (e.g., EU AI Act), and expose the company to reputational harm and legal liability.

Geopolitical & External Risks

Geopolitical Exposure:

• Venezuela Sanctions: U.S. sanctions against Venezuela may prevent the company from securing patent protection in that country.
• Brexit: Uncertainty regarding intellectual property rights in the United Kingdom following Brexit could impede the company's ability to obtain or maintain meaningful IP rights.
• U.S. Executive Orders on Data: Recent U.S. Department of Justice regulations implementing Executive Order 14117 (Preventing Access to Americans’ Bulk Sensitive Personal Data) could impact transactions involving human genomic data and biospecimens.

Innovation & Technology Leadership

Research & Development Focus: Core Technology Areas: Compass Therapeutics, Inc. focuses on developing proprietary antibody-based therapeutics, with a scientific emphasis on the relationship between angiogenesis, the immune system, and tumor growth. Its core technology areas include:

• Bispecific Antibodies: A significant portion of the pipeline consists of bispecific antibodies, including tovecimig (DLL4 x VEGF-A), CTX-8371 (PD-1 x PD-L1), and CTX-10726 (PD-1 x VEGF-A).
• Agonistic Antibodies: CTX-471 is an agonistic antibody targeting CD137.
• StitchMabs TMplatform: A proprietary research and discovery platform designed to generate a broad pipeline of product candidates, including bispecific antibodies, by screening for synergistic pairs of antigen-binding domains. Innovation Pipeline: Beyond its four clinical-stage product candidates, the company is developing multiple additional product candidates.

Intellectual Property Portfolio:

• Patent Strategy: The company strives to protect its proprietary technology, inventions, and know-how by seeking, maintaining, and defending patent rights in the United States and internationally. It also relies on trade secrets and know-how.
• Patent Holdings (as of January 31, 2026):
  • Nearly 100 issued patents and patent applications pending in the United States and foreign jurisdictions.
  • tovecimig: Licensed 2 patent families with 2 issued U.S. patents and 27 issued foreign patents, generally expected to start to expire in 2033.
  • CTX-471: Owns 4 pending patent families with 10 issued U.S. patents and issued patents in Taiwan, China, Eurasia, Israel, Japan, Korea, Malaysia, Mexico, Singapore, and New Zealand, generally expected to start to expire in 2038.
  • CTX-8371: Owns 1 pending patent family with 3 issued U.S. patents and issued patents in China, Japan, Malaysia, Mexico, and Taiwan, generally expected to start to expire in 2039.
  • CD277 Discovery and Research Programs: Owns, or has an ownership interest in, 2 pending patent families with 1 issued U.S. patent, generally expected to start to expire in 2039.
  • Antibody and Display Programs (Common Light Chains): Owns 1 pending patent family with 1 issued U.S. patent, generally expected to start to expire in 2039.
• Trademark Strategy: Has filed for and obtained trademark protection for the COMPASS THERAPEUTICS word mark and logo in multiple jurisdictions, and the StitchMabs TMword mark in the United States.
• Trade Secret Protection: Relies on confidentiality agreements with employees, consultants, scientific advisors, and contractors, along with physical and electronic security measures, to protect proprietary know-how and information.

Technology Partnerships:

• ABL Bio, Inc.: Partnered for the licensing and joint development of tovecimig.
• Adimab, LLC: Collaborated for the license of certain antibodies, including CTX-471.

Leadership & Governance

Executive Leadership Team

Leadership Continuity: In December 2025, the board of directors adopted the Compass Therapeutics, Inc. 2025 Inducement Plan to attract highly-qualified prospective officers and employees. On January 1, 2026, two million options were granted under this plan to two new officers as a material inducement to join the company.

Board Composition: The board of directors is divided into three classes. The board is responsible for appointing the management team. The audit committee of the board of directors provides guidance on the prioritization of risk remediation and ongoing implementation of cybersecurity improvements, receiving quarterly updates from management on cybersecurity and other information technology risks.

Human Capital Strategy

Workforce Composition (as of December 31, 2025):

• Total Employees: 39 employees.
• Skill Mix: 25 employees are primarily engaged in research and development and clinical activities.

Talent Management: Acquisition & Retention: The company's human capital objectives include identifying, recruiting, retaining, incentivizing, and integrating employees, advisors, and consultants. Equity and cash incentive plans are in place to attract, retain, and reward personnel.

• 401(k) Plan: The company offers a 401(k) defined contribution plan for substantially all employees, with matching contributions up to 6% of salary (increased from 4% on July 1, 2023).

Diversity & Development: Compass Therapeutics, Inc. values diversity at all levels and focuses on extending diversity and inclusion initiatives across its workforce, including developing strategies for building diverse teams and promoting the advancement of leaders from different backgrounds.

Regulatory Environment & Compliance

Regulatory Framework: Industry-Specific Regulations: Compass Therapeutics, Inc. is subject to extensive regulation by government authorities in the United States (primarily the FDA under the Federal Food, Drug, and Cosmetic Act and the Public Health Service Act) and other countries. This regulation covers manufacturing, research and clinical development, marketing, labeling, storage, distribution, post-approval monitoring, advertising, promotion, and export/import of biological products.

• Development & Approval: Requires rigorous preclinical testing (GLP), submission of Investigational New Drug (IND) applications, approval by Institutional Review Boards (IRBs), and conduct of human clinical trials (GCP). Marketing approval requires submission of a Biologics License Application (BLA) to the FDA.
• Expedited Programs: The company may seek Fast Track, Priority Review, Accelerated Approval, Breakthrough Therapy designations, or Real-Time Oncology Review (RTOR) to expedite development and review. Accelerated approval typically requires post-marketing confirmatory trials.
• Post-Approval Obligations: Approved products are subject to pervasive and continuing regulation, including recordkeeping, periodic reporting, product sampling, distribution, advertising/promotion restrictions, adverse event reporting, and ongoing compliance with cGMP and cGCP.
• Exclusivity & Extensions: Products may be eligible for pediatric exclusivity (additional six months of marketing protection) and patent term extension under the Hatch-Waxman Act (up to five years). The Biologics Price Competition and Innovation Act of 2009 provides an abbreviated approval pathway for biosimilars and up to 12 years of market exclusivity for reference biological products.
• International Regulations: Subject to varying regulatory requirements in other jurisdictions, including the European Union's Clinical Trials Regulation and marketing authorization procedures (Centralized, Decentralized, Mutual Recognition), and data/market exclusivity provisions (8+2 years). Trade & Export Controls: The company is subject to U.S. and foreign anti-corruption, anti-money laundering, export control, sanctions, and other trade laws and regulations. Violations can result in substantial criminal fines, civil penalties, and loss of trade privileges. This includes compliance with the U.S. Foreign Corrupt Practices Act (FCPA) for international dealings. Legal Proceedings: The company is not currently a party to any litigation or legal proceedings that, in the opinion of management, are likely to have a material adverse effect on its business.

Regulatory & Compliance Risks:

• Healthcare Reform Legislation: The company is impacted by current and future healthcare reform legislation, including the Affordable Care Act (ACA) and the Inflation Reduction Act of 2022 (IRA), which introduces a 1% excise tax on share repurchases, a 15% corporate alternative minimum tax, Medicare drug price negotiation, and inflation rebates. Recent Executive Orders (e.g., 14273, 14297) and CMS proposals (e.g., GLOBE, GUARD, GENEROUS models) aim to reduce drug prices, potentially impacting future revenues. State-level Prescription Drug Affordability Boards (PDABs) also pose pricing pressures.
• Fraud and Abuse Laws: Relationships with healthcare providers and third-party payors are subject to federal Anti-Kickback Statute, False Claims Act, HIPAA, and state equivalents. Non-compliance could lead to significant sanctions.
• Cybersecurity and Data Privacy: The company is subject to various data privacy and security laws, including HIPAA, the California Consumer Privacy Act (CCPA), the California Privacy Rights Act (CPRA), Washington’s My Health My Data Act, and the EU General Data Protection Regulation (GDPR). New U.S. Department of Justice regulations (Executive Order 14117) on bulk sensitive personal data also apply. Non-compliance could result in reputational harm, litigation, and significant fines.
• AI Regulation: The use of artificial intelligence (AI) in business processes is subject to evolving laws and regulations, such as the EU’s Artificial Intelligence Act and various U.S. state laws, as well as FDA guidance. Compliance requires significant resources and carries risks of legal liability and reputational harm.

Tax Strategy & Considerations

Tax Profile:

• Effective Tax Rate: The company reported no income tax expense for the years ended December 31, 2025, and 2024, resulting in an effective tax rate of 0%. This is due to recurring net losses and a full valuation allowance against deferred tax assets.
• Net Operating Loss (NOL) Carryforwards (as of December 31, 2025):
  • U.S. federal NOLs: $200.4 million (no expiration).
  • State NOLs: $206.7 million (begin expiring in 2040).
• Research & Development (R&D) Credit Carryforwards (as of December 31, 2025):
  • Federal R&D credits: $9.3 million (begin expiring in 2039).
  • State R&D credits: $2.5 million (begin expiring in 2031).
• Valuation Allowance: A valuation allowance of $79.2 million as of December 31, 2025, fully offsets deferred tax assets, as management believes it is more likely than not that these benefits will not be realized.
• Tax Reform Impact:
  • Inflation Reduction Act of 2022 (IRA): Imposes a 1% excise tax on share repurchases (after December 31, 2022) and a 15% corporate alternative minimum tax. To date, the IRA has not had a material impact on the company's consolidated financial statements.
  • Tax Cuts and Jobs Act of 2017 (TCJA) Section 174: Required capitalization of R&D costs incurred in tax years beginning after December 31, 2021.
  • One Big Beautiful Bill Act of 2025 (OBBBA): Enacted in 2025, this act allows for current deductibility of domestic R&D costs and immediate deduction for previously capitalized costs for certain taxpayers, retroactive to 2024. The company elected to take this deduction in 2024.

Insurance & Risk Transfer

Risk Management Framework:

• Insurance Coverage: Compass Therapeutics, Inc. maintains trial liability insurance coverage consistent with industry standards for its human clinical trials. The company intends to expand its insurance coverage to include the sale of commercial products if marketing approval is obtained. Additionally, it holds third-party insurance coverage for cybersecurity risks, commensurate with industry standards for a company of its size and stage.
• Risk Transfer Mechanisms: Not explicitly detailed beyond insurance coverage.