ARROWHEAD PHARMACEUTICALS, INC.

Previous wording

The Company believes that TRiMTM enabled therapeutics offer several potential advantages over prior generations and competing technologies, including: simplified manufacturing and reduced costs; multiple routes of administration including subcutaneous injection and inhaled administration; the ability to target multiple tissue types including liver, lung, skeletal muscle, central nervous system (CNS), adipose tissue, ocular, and cardio-myocytes; and the potential for improved safety and reduced risk of intracellular buildup, because there are fewer metabolites from smaller, simpler molecules.

Current wording

The Company believes that TRiMTM enabled therapeutics offer several potential advantages over prior generations and competing technologies, including: simplified manufacturing and reduced costs; multiple routes of administration including subcutaneous injection and inhaled administration; the ability to target multiple tissue types including liver, lung, skeletal muscle, central nervous system (CNS), adipose tissue, ocular, and cardiomyocytes; and the potential for improved safety and reduced risk of intracellular buildup, because there are fewer metabolites from smaller, simpler molecules.

Previous wording

The Company continues to develop other clinical candidates for future clinical trials. Clinical candidates are tested internally and through Good Laboratory Practice (GLP) toxicology studies at outside laboratories. Drug materials for such studies and clinical trials are either manufactured internally or contracted to third-party manufacturers. The Company engages third-party contract research organizations (CROs) to manage clinical trials and works cooperatively with such organizations on all aspects of clinical trial management, including plan design, patient recruiting, and follow up. These outside costs, including toxicology/efficacy testing and manufacturing costs, as well as the preparation for and administration of clinical trials, are referred to as “candidate costs.” As clinical candidates progress through clinical development, candidate costs will increase.

Current wording

The Company continues to develop other clinical candidates for future clinical trials. Clinical candidates are tested internally and through Good Laboratory Practice (GLP) toxicology studies at outside laboratories. Drug materials for such studies, clinical trials, and commercial products are either manufactured internally or contracted to third-party manufacturers. The Company engages third-party contract research organizations (CROs) to manage clinical trials and works cooperatively with such organizations on all aspects of clinical trial management, including plan design, patient recruiting, and follow up. These outside costs, including toxicology/efficacy testing and manufacturing costs, as well as the preparation for and administration of clinical trials, are referred to as “candidate costs.” As clinical candidates progress through clinical development, candidate costs will increase.

Previous wording

The First Quarter of Fiscal 2026 Business Highlights

Current wording

The First Half Quarter of Fiscal 2026 Business Highlights

Previous wording

The bullets below highlight key developments in our business during the first quarter of fiscal year 2026:

Current wording

The bullets below highlight key developments in our business during the first half of fiscal year 2026:

Previous wording

•Filed a request for regulatory clearance to initiate a Phase 1/2a clinical trial of ARO-DIMER-PA, the Company’s investigational RNAi therapeutic being developed as a potential treatment for atherosclerotic cardiovascular disease (ASCVD) due to mixed hyperlipidemia. ARO-DIMER-PA is designed to silence expression of the proprotein convertase subtilisin kexin 9 (PCSK9) and apolipoprotein C3 (APOC3) genes. This represents an important step forward for the RNAi field as it is the first clinical candidate to target two genes simultaneously in one molecule, enabled by Arrowhead’s innovative and proprietary TRiM platform.;

Current wording

•Initiated and dosed the first subjects in a Phase 1/2a clinical trial of ARO-DIMER-PA, the Company’s investigational RNAi therapeutic being developed as a potential treatment for atherosclerotic cardiovascular disease (ASCVD) due to mixed hyperlipidemia.

Previous wording

•Announced interim results from two Phase 1/2a clinical trials of ARO-INHBE and ARO-ALK7, the Company’s investigational RNAi therapeutics being developed as potential treatments for obesity, showing for patients enrolled in the study that's:

Current wording

•Announced interim results from two Phase 1/2a clinical trials of ARO-INHBE and ARO-ALK7, the Company’s investigational RNAi therapeutics being developed as potential treatments for obesity, showing for patients enrolled in the study that:

Previous wording

◦ARO-ALK7, the first RNAi-therapeutic to show adipocyte gene target silencing in a clinical trial, achieved dose dependent reductions in adipose ALK7 mRNA with a mean reduction of -88% at the 200 mg dose at week 8 with a maximum reduction of -94%.

Current wording

◦ARO-ALK7, the first RNAi-therapeutic to show adipocyte gene target silencing in a clinical trial, achieved dose dependent reductions in adipose ALK7 messenger (mRNA) with a mean reduction of -88% at the 200 mg dose at week 8 with a maximum reduction of -94%.

Previous wording

•The FDA approved the Company's New Drug Application (NDA) for REDEMPLO injection for Familial Chylomicronemia Syndrome (FCS), on November 18, 2025. This approval was supported by clinical data from the Phase 3 PALISADE study, a randomized, double-blind, placebo-controlled trial in adults with clinically diagnosed or genetically confirmed FCS. The PALISADE study met its primary endpoint and all multiplicity-controlled key secondary endpoints, including demonstrating significant reductions in triglycerides and APOC3. In PALISADE, 25 mg REDEMPLO achieved deep and durable reductions in triglycerides, with a median change from baseline of -80% versus -17% in the pooled placebo group, and a lower numerical incidence of acute pancreatitis compared with placebo; and

Current wording

•The FDA approved the Company's New Drug Application (NDA) for REDEMPLO injection for Familial Chylomicronemia Syndrome (FCS), on November 18, 2025. This approval was supported by clinical data from the Phase 3 PALISADE study, a randomized, double-blind, placebo-controlled trial in adults with clinically diagnosed or genetically confirmed FCS. The PALISADE study met its primary endpoint and all multiplicity-controlled key secondary endpoints, including demonstrating significant reductions in triglycerides and APOC3. In PALISADE, 25 mg REDEMPLO achieved deep and durable reductions in triglycerides, with a median change from baseline of -80% versus -17% in the pooled placebo group, and a lower numerical incidence of acute pancreatitis compared with placebo.

Previous wording

The bullets below highlight other key developments in our business subsequent to the first quarter of fiscal year 2026:

Current wording

The bullets below highlight other key developments in our business subsequent to the second quarter of fiscal year 2026:

Previous wording

Total revenue for the three months ended December 31, 2025 increased by $261.5 million, from the same period of 2024. The change was primarily driven by the revenue recognition associated with Sarepta, Novartis and Sanofi license agreements as discussed below.

Current wording

Total revenue for the three and six months ended March 31, 2026 decreased by $469.0 million and $207.4 million, respectively, from the same periods of 2025. The change was primarily driven by lower Sarepta revenue, partially offset by increased revenue from Novartis and Sanofi, reflecting the timing and progress of the Company’s respective collaboration and license agreements.

Previous wording

The Company has evaluated each agreement in accordance with FASB Topic 808–Collaborative Arrangements and Topic 606-Revenue for Contracts from Customers. See Note 2 — Collaboration and License Agreements of the Notes to Consolidated Financial Statements of Part I, “Item 1. Financial Statements” for more information on revenue recognized under the collaboration and license agreements.

Current wording

Topic 606-Revenue for Contracts from Customers. See Note 2 — Collaboration and License Agreements of the Notes to Consolidated Financial Statements of Part I, “Item 1. Financial Statements” for more information on revenue recognized under the collaboration and license agreements.

Previous wording

Sarepta: On November 25, 2024, the Company entered into the Sarepta Collaboration Agreement and Stock Purchase Agreement with Sarepta for the development and commercialization of multiple clinical and preclinical programs in rare, genetic diseases of the muscle, central nervous system, and lungs. During the three months ended December 31, 2025, the Company recorded $229.5 million in revenue.

Current wording

Sarepta: On November 25, 2024, the Company entered into the Sarepta Collaboration Agreement and Stock Purchase Agreement with Sarepta for the development and commercialization of multiple clinical and preclinical programs in rare, genetic diseases of the muscle, central nervous system, and lungs. On December 16, 2025, the Company entered into the Sarepta Clinical Supply Agreement, whereby the Company is responsible for manufacturing and supplying certain materials to Sarepta for specified activities. During the six months ended March 31, 2026, the Company recorded $271.2 million in revenue.

Previous wording

Novartis: On August 29, 2025, the Company entered into the Novartis Collaboration Agreement with Novartis for the development and commercialization of multiple preclinical programs in rare, genetic diseases of the central nervous system. During the three months ended December 31, 2025, the Company recorded $34.2 million in revenue.

Current wording

Novartis: On August 29, 2025, the Company entered into the Novartis Collaboration Agreement with Novartis for the development and commercialization of multiple preclinical programs in rare, genetic diseases of the central nervous system. During the six months ended March 31, 2026, the Company recorded $54.7 million in revenue.

Previous wording

Visirna: On August 1, 2025, Visirna HK, a wholly owned subsidiary of Visirna Therapeutics, Inc, a majority owned subsidiary of the Company, entered into an Asset Purchase Agreement with Sanofi, pursuant to which Visirna HK sold all of its assets and rights in investigational plozasiran to Sanofi, which included an assignment of Visirna HK’s rights (as successor by assignment from Visirna) to develop and commercialize investigational plozasiran in Greater China pursuant to that certain License Agreement by and between the Company and Visirna dated, April 25, 2022 (the “Visirna License Agreement”). During thethree months ended December 31, 2025, the Company recorded$0.2 million in revenue.

Current wording

Visirna and Sanofi: On August 1, 2025, Visirna HK, a wholly owned subsidiary of Visirna Therapeutics, Inc, a majority owned subsidiary of the Company, entered into an Asset Purchase Agreement with Sanofi, pursuant to which Visirna HK sold all of its assets and rights in investigational plozasiran to Sanofi, which included an assignment of Visirna HK’s rights (as successor by assignment from Visirna) to develop and commercialize investigational plozasiran in Greater China pursuant to that certain License Agreement by and between the Company and Visirna dated, April 25, 2022 (the “Visirna License Agreement”). During the six months ended March 31, 2026, the Company recorded $10.7 million in revenue associated with this transaction.

Previous wording

The analysis below details the operating expenses and discusses the expenditures of the Company within the major expense categories. For purposes of comparison, the amounts for the three months ended December 31, 2025 and 2024 are shown in the tables below.

Current wording

The analysis below details the operating expenses and discusses the expenditures of the Company within the major expense categories. For purposes of comparison, the amounts for the three and six months ended March 31, 2026 and 2025 are shown in the tables below.

Previous wording

Research and development expenses consist of expenses for drug candidate and drug discovery costs, which are comprised primarily of outsourced costs related to the manufacturing of clinical supplies, toxicity/efficacy studies and clinical trial expenses. Internal costs primarily relate to discovery operations at the Company’s research facilities in California and Wisconsin, including facility costs and laboratory-related expenses. The Company operates in a cross-functional manner across projects and does not separately allocate facilities-related costs, candidate costs, discovery costs, compensation expenses, depreciation and amortization expenses, and other expenses related to research and development activities. The Company does not fully track research and development expenses by individual research and development projects, or by individual drug candidates.

Current wording

Research and development expenses consist of expenses for drug candidate and discovery costs, which are comprised primarily of outsourced costs related to the manufacturing of clinical supplies, toxicity/efficacy studies and clinical trial expenses. Internal costs primarily relate to discovery operations at the Company’s research facilities in California and Wisconsin, including facility costs and laboratory-related expenses. The Company operates in a cross-functional manner across projects and does not separately allocate facilities-related costs, candidate costs, discovery costs, compensation expenses, depreciation and amortization expenses, and other expenses related to research and development activities. The Company does not fully track research and development expenses by individual research and development projects, or by individual drug candidates.

Previous wording

Candidate costs increased $28.1 million, or 37%, for the three months ended December 31, 2025 compared to the same period of 2024. The increase was primarily due to the additional progression of the Company’s pipeline of candidates into and through clinical trials, which resulted in higher outsourced clinical trial costs, manufacturing, and toxicity study costs.

Current wording

Candidate costs increased $28.3 million, or 40%, for the three months ended March 31, 2026 and $56.4 million, or 38%, for the six months ended March 31, 2026 compared to the same periods of 2025. The increase was primarily due to the additional progression of the Company’s pipeline of candidates into and through clinical trials, which resulted in higher outsourced clinical trial costs, manufacturing, and toxicity study costs.

Previous wording

R&D discovery costs increased $8.9 million, or 69%, for the three months ended December 31, 2025 compared to the same period of 2024. This increase primarily reflects higher R&D discovery activity associated with ongoing discovery efforts and expansion into novel therapeutic areas and tissue types; partially offset by lower partnership cost.

Current wording

Discovery costs increased $3.7 million, or 25%, for the three months ended March 31, 2026 and $12.6 million, or 45%, for the six months ended March 31, 2026 compared to the same periods of 2025, primarily driven by higher R&D discovery activity associated with ongoing discovery efforts and expansion into novel therapeutic areas and tissue types, partially offset by lower partnership cost.

Previous wording

Salaries consist of salary, bonuses, payroll taxes, and related benefits for the Company’s R&D personnel. Salaries expense increased $2.9 million, or 11%, for the three months ended December 31, 2025 compared to the same period of 2024. The increase was primarily due to an increase in headcount that has occurred as the Company has expanded its pipeline of candidates and worked to prepare for the manufacture of commercial material at the Verona facility, as well as annual salary increases.

Current wording

Salaries consist of salary, bonuses, payroll taxes, and related benefits for the Company’s R&D personnel. Salaries expense increased $6.6 million, or 25%, for the three months ended March 31, 2026 and $9.5 million, or 18%, for the six months ended March 31, 2026 compared to the same periods of 2025. The increase was primarily due to an increase in headcount that has occurred as the Company has expanded its pipeline of candidates and worked to prepare for the manufacture of commercial material at the Verona facility, as well as annual salary increases.

Previous wording

Facilities-related expense includes lease costs for the Company’s research and development facilities in San Diego, California and in Madison and Verona, Wisconsin. These expenses increased $0.4 million, or 5%, for the three months ended December 31, 2025 compared to the same period of 2024. This increase was primarily due to expenses, such as utilities and repair and maintenance charges, associated with the expanded manufacturing facilities in Verona, Wisconsin to support manufacturing operations.

Current wording

Facilities-related expense includes lease costs for the Company’s research and development facilities in San Diego, California and in Madison, Wisconsin. These expenses increased $0.9 million, or 13%, for the three months ended March 31, 2026 and $1.2 million or 8%, for the six months ended March 31, 2026 compared to the same period of 2025. This increase was primarily due to expenses, such as utilities and repair and maintenance charges, associated with the expanded manufacturing facilities in Verona, Wisconsin to support manufacturing operations.

Previous wording

Stock compensation expense, a non-cash expense, is primarily based on the valuation of restricted stock units granted to employees, which is based on the closing stock price on the grant date. Stock compensation expense decreased $1.2 million, or 16%, for the three months ended December 31, 2025 compared to the same period of 2024. The decrease was primarily related to stock options award expense incurred in the first fiscal quarter 2024 related to Visirna, our variable interest entity, that did not repeat in the first fiscal quarter 2025.

Current wording

Stock compensation expense, a non-cash expense, is primarily based on the valuation of restricted stock units granted to employees, which is based on the closing stock price on the grant date. Stock compensation expense increased $0.4 million, or 5%, for the three months ended March 31, 2026 compared to the same period of 2025, primarily driven by the annual issuance of RSU grants to employees in January 2026. Stock compensation expense decreased $0.8 million, or 5% for the six months ended March 31, 2026 compared to the same period of 2025, primarily driven by stock options award expense incurred in the second fiscal quarter 2025 related to Visirna, our variable interest entity, that did not repeat in the second fiscal quarter 2026.

Previous wording

Depreciation and amortization expense, a non-cash expense, relates to depreciation on buildings, lab equipment and leasehold improvements. These expenses increased $1.2 million, or 25% for the three months ended December 31, 2025 compared to the same period of 2024. The increase was primarily attributable to the transfer of additional manufacturing equipment following the completion of certification, qualification and validation to support manufacturing operations.

Current wording

Depreciation and amortization expense, a non-cash expense, relates to depreciation on buildings, lab equipment and leasehold improvements. These expenses increased $0.3 million, or 5%, for the three months ended March 31, 2026 and $1.5 million, or 14% for the six months ended March 31, 2026 compared to the same periods of 2025. The increase was primarily attributable to the transfer of additional manufacturing equipment following the completion of certification, qualification and validation to support manufacturing operations.

Previous wording

The following table provides details of general and administrative expenses for the periods indicated:

Current wording

The following table provides details of selling, general and administrative expenses for the periods indicated:

Previous wording

Salaries expense increased $4.6 million, or 63%, for the three months ended December 31, 2025 compared to the same period of 2024. The increase was driven by higher headcount required to support the Company’s growth as the Company prepared for commercialization as well as of annual salary increases.

Current wording

Salaries expense increased $4.6 million, or 58%, for the three months ended March 31, 2026 and $9.2 million, or 60% for the six months ended March 31, 2026 compared to the same periods of 2025. The increase was driven by higher headcount required to support the Company’s growth as the Company prepared for commercialization, as well as of annual salary increases.

Previous wording

Professional, outside services, and other expenses include costs related to legal, consulting, patent filings, business insurance, other external services, as well as travel, communication, and technology expenses. These expenses increased $8.8 million, or 87%, for the three months ended December 31, 2025 compared to the same period of 2024. The increase was mainly due to professional services associated with commercialization as the Company initiated a product launch, including costs for data analytics, marketing and commercial launch support.

Current wording

Professional, outside services, and other expenses include costs related to commercial activities, legal, consulting, patent filings, business insurance, other external services, as well as travel, communication, and technology expenses. These expenses increased $8.1 million, or 75%, for the three months ended March 31, 2026 and $16.9 million, or 81% for the six months ended March 31, 2026 compared to the same periods of 2025. The increase was mainly due to commercialization expense associated with the Company;s launch of REDEMPLO, including costs for marketing and commercial launch support.

Previous wording

Facilities related expense primarily includes rental costs and other facilities-related costs for the Company’s corporate headquarters in Pasadena, California. These expenses increased $0.4 million, or 29%, for the three months ended December 31, 2025 compared to the same period of 2024. The increase was primarily driven by higher staff amenities expenses driven by higher headcount.

Current wording

Facilities related expense primarily includes rental costs and other facilities-related costs for the Company’s corporate headquarters in Pasadena, California. These expenses increased $0.4 million, or 38%, for the three months ended March 31, 2026 and $0.8 million, or 33% for the six months ended March 31, 2026 compared to the same periods of 2025. The increase was primarily driven by higher staff amenities expenses driven by higher headcount.

Previous wording

Stock compensation expense, a non-cash expense, is based on the valuation of restricted stock units granted to employees, which is based on the closing stock price on the grant date. These expenses increased $5.4 million, or 70%, for the three months ended December 31, 2025 compared to the same periods of 2024. The increase was primarily due to recognition of compensation expense related to a performance-based restricted stock unit award following the achievement of a pre-specified performance milestone.

Current wording

Stock compensation expense, a non-cash expense, is based on the valuation of restricted stock units granted to employees, which is based on the closing stock price on the grant date. These expenses increased $0.2 million, or 3%, for the three months ended March 31, 2026 and $5.6 million, or 35% for the six months ended March 31, 2026 compared to the same periods of 2025. The increase was primarily due to recognition of compensation expense related to a performance-based restricted stock unit award following the achievement of a pre-specified performance milestone.

Previous wording

Net income attributable to Arrowhead Pharmaceuticals, Inc. was $30.8 million for the three months ended December 31, 2025, compared to a net loss attributable to Arrowhead Pharmaceuticals, Inc. of $173.1 million for the three months ended December 31, 2024. Net income per diluted share was $0.22 for the three months ended December 31, 2025, compared to a net loss per diluted share of $1.39 for the three months ended December 31, 2024. The increase in net income attributable to Arrowhead Pharmaceuticals, Inc. for the three months ended December 31, 2025 compared to the same period of 2024 was primarily due to an increase in revenue from the Sarepta Collaboration Agreement, partially offset by higher research and development expenses, associated with the expansion of the Company's pipeline and progression through clinical trial phases.

Current wording

Net loss attributable to Arrowhead Pharmaceuticals, Inc. was $132.7 million and $101.9 million for the three and six months ended March 31, 2026, compared to a net income attributable to Arrowhead Pharmaceuticals, Inc. of $370.4 million and $197.4 million for the three and six months ended March 31, 2025. Net loss per diluted share was $0.93 and $0.73 for the three and six months ended March 31, 2026, compared to a net income per diluted share of $2.75 and $1.52 for the three and six months ended March 31, 2025. The decrease in net income attributable to Arrowhead Pharmaceuticals, Inc. for the three and six months ended March 31, 2026 compared to the same periods of 2025 was primarily due to a decrease in revenue from the Sarepta Collaboration Agreement, combined with higher commercial costs as well as research and development expenses, associated with the expansion of the Company's pipeline and progression through clinical trial phases.

Previous wording

The Company has historically financed its operations through the sale of its equity securities, credit facility, revenue from its licensing and collaboration agreements, and the sale of certain future royalties. Research and development activities have required significant capital investment since the Company’s inception and are expected to continue to require significant cash expenditure as the Company’s pipeline continues to expand and matures into later stage clinical trials, including commercialization efforts.

Current wording

The Company’s primary sources of financing have been through the sale of its equity securities, credit facility, revenue from its licensing and collaboration agreements, the sale of certain future royalties and issuance of convertible debt. Research and development activities have required significant capital investment since the Company’s inception and are expected to continue to require significant cash expenditure as the Company’s pipeline continues to expand and matures into later stage clinical trials, including commercialization efforts.

Previous wording

The Company’s cash, cash equivalents and restricted cash was $201.6 million as of December 31, 2025 compared to $226.5 million as of September 30, 2025. Cash invested in available-for-sale securities was $715.0 million as of December 31, 2025 compared to $692.8 million as of September 30, 2025.

Current wording

The Company’s cash, cash equivalents and restricted cash was $188.5 million as of March 31, 2026 compared to $226.5 million as of September 30, 2025. Cash invested in available-for-sale securities was $1,595.6 million as of March 31, 2026 compared to $692.8 million as of September 30, 2025.

Previous wording

On November 25, 2024, the Company entered into a licensing and collaboration agreement with Sarepta. Upon closing, the Company received $325.0 million for the purchase of 11,926,301 shares of common stock, at a price per share of $27.25, and received $500.0 million as an upfront payment on February 24, 2025. During the fourth quarter of fiscal 2025, a $100.0 million milestone payment from Sarepta was triggered, when the Company reached the first of two prespecified enrollment targets and subsequent authorization to dose escalate in a Phase 1/2 clinical study of ARO-DM1, an investigational RNAi therapeutic for the treatment of type 1 myotonic dystrophy (DM1). The Company received $53.2 million of Arrowhead common stock and $50.0 million cash from Sarepta to satisfy the milestone payment. The Company is eligible to receive additional milestones of up to $250.0 million over the 12 months from December 31, 2025, inclusive of the second DM1 milestone payment of $200.0 million earned in November 2025 and received in January 2026.

Current wording

On November 25, 2024, the Company entered into a licensing and collaboration agreement with Sarepta. Upon closing, the Company received $325.0 million for the purchase of 11,926,301 shares of common stock, at a price per share of $27.25, and received $500.0 million as an upfront payment on February 24, 2025. During the fourth quarter of fiscal 2025, a $100.0 million milestone payment from Sarepta was triggered, when the Company reached the first of two prespecified enrollment targets and subsequent authorization to dose escalate in a Phase 1/2 clinical study of ARO-DM1, an investigational RNAi therapeutic for the treatment of type 1 myotonic dystrophy (DM1). The Company received $53.2 million of Arrowhead common stock and $50.0 million cash from Sarepta to satisfy the milestone payment. During the second quarter of fiscal 2026, the Company received $200.0 million of the second DM1 milestone payment and a $50.0 million payment for the first installment of the annual fee. The Company is eligible to receive the second installment of the annual fee of up to $50.0 million over the 12 months from March 31, 2026,

Previous wording

On December 10, 2025, the Company entered into an Amended and Restated Open Market Sale Agreement (the “Amended and Restated Sale Agreement”) with Jefferies LLC, acting as sales agent and/or principal, which amended and restated the Company’s prior open market sale agreement in its entirety. Pursuant to the Amended and Restated Sale Agreement, the Company may, from time to time, sell shares of the Company’s common stock through Jefferies LLC in an at-the-market offering, up to the maximum program amount permitted under the Company’s effective shelf registration statement. As of December 31, 2025, the Company had sold approximately 689,000 shares of common stock under the Amended and Restated Sale Agreement, generating gross proceeds of $48.2 million and net proceeds of $46.8 million, after deducting commissions and offering costs.

Current wording

On December 10, 2025, the Company entered into the Amended and Restated Sale Agreement with Jefferies LLC, acting as sales agent and/or principal, which amended and restated the Company’s prior open market sale agreement in its entirety. Pursuant to the Amended and Restated Sale Agreement, the Company may, from time to time, sell shares of the Company’s common stock through Jefferies LLC in an at-the-market offering, up to the maximum program amount permitted under the Company’s effective shelf registration statement. As of March 31, 2026, the Company had sold approximately 689,000 shares of common stock under the Amended and Restated Sale Agreement, generating gross proceeds of $48.2 million and net proceeds of $46.8 million, after deducting commissions and offering costs.

Previous wording

During the three months ended December 31, 2025, cash flow provided by operating activities was $13.5 million, which was primarily due to $200.0 million of cash received as part of the Novartis agreement which was recorded in deferred revenue, increase in ongoing expenses related to the Company's research and development programs and general and administrative expenses, partially offset by the increase in accounts receivable relating to the achievement of the ARO-DM1 development milestone of $200 million per the Sarepta Collaboration Agreement. Cash used in investing activities amounted to $23.7 million, which was primarily attributable to investment purchases of $136.9 million, and capital expenditures of $2.1 million, partially offset by proceeds from maturities of investments of $115.3 million. Cash used in financing activities of $14.8 million was primarily due to the repayment of the credit facility of $66.7 million, partially offset by $46.8 million in proceeds received from the issuance of common stock under the ATM Offering and $5.1 million from the exercise of stock options (See Note 6 — Stockholders’ Equity of Notes to Consolidated Financial Statements of Part I, “Item 1. Financial Statements”).

Current wording

During the six months ended March 31, 2026, cash flow provided by operating activities was $97.9 million, which was primarily due to $200.0 million of cash received as part of the Novartis agreement, $200.0 million of the second DM1 milestone payment and a $50.0 million payment for the first installment of the annual fee received as part of the Sarepta agreement, partially offset by increase in ongoing expenses related to the Company's research and development programs and selling, general and administrative expenses. Cash used in investing activities amounted to $918.0 million, which was primarily attributable to investment purchases of $1,061.6 million, and capital expenditures of $4.7 million, partially offset by proceeds from maturities of investments of $124.5 million and proceeds from sales of investments of $23.7 million. Cash provided by financing activities of $781.0 million was primarily due to $681.3 million net proceeds from the issuance of convertible note, $116.6 million in net proceeds from a follow-on common stock offering, $46.8 million in net proceeds from the issuance of common stock under the Company's at-the-market equity offering program, $100.0 million proceeds from issuance of pre-funded warrants and $10.1 million proceeds from the exercise of stock options, partially offset by partial repayment of the credit facility of $84.5 million, purchase of the Capped Calls of $47.9 million, and dividends paid to noncontrolling shareholders of $41.5 million (See Note 6 — Stockholders’ Equity of Notes to Consolidated Financial Statements of Part I, “Item 1. Financial Statements”).

Previous wording

During the three months ended December 31, 2024, cash flow used in operating activities was $146.3 million, which was primarily due to the ongoing expenses related to the Company’s research and development programs and general and administrative expenses. Cash used in investing activities was $76.9 million, which was primarily attributable to capital expenditures of $7.5 million and investment purchases of $33.7 million, partially offset by proceeds from sales and maturities of investments of $118.2 million. Cash provided by financing activities of $20.6 million was primarily related to cash received from the issuance of common stock as well as stock option exercises.

Current wording

During the six months ended March 31, 2025, cash flow provided by operating activities was $313.8 million, which was primarily due to $500.0 million of cash received as part of the Sarepta agreement, partially offset by ongoing expenses related to the Company's research and development programs and selling, general and administrative expenses. Cash used in investing activities was $343.3 million, which was primarily attributable to capital expenditures of $12.8 million and investment purchases of $677.9 million, partially offset by proceeds from sales and maturities of investments of $347.4 million. Cash provided by financing activities of $113.0 million was primarily related to cash received from the issuance of common stock as well as stock option exercises.