Adagio Medical Holdings, Inc.

Previous wording

The following discussion and analysis of financial condition and results of operations should be read together with the condensed consolidated financial statements and the related notes and other financial information included elsewhere in this Quarterly Report on Form 10-Q (this “Report”). Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors. Please see “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in this report. Unless the context otherwise requires, references in this section of the Report to “we,” “us,” “Adagio,” and “the Company” refer to the business and operations of Adagio Medical Holdings, Inc. and its consolidated subsidiaries following the consummation of the Business Combination. References to “Legacy Adagio” refer to the business and operation of Adagio Medical, Inc. and its consolidated subsidiaries prior to the Closing. “ListCo” refers to Aja HoldCo, Inc., a Delaware corporation, prior to the Closing. ListCo changed its name to Adagio Medical Holdings, Inc. after the Closing. References to our “management” or our “management team” refer to our officers and directors.

Current wording

The following discussion and analysis of financial condition and results of operations should be read together with the condensed consolidated financial statements and the related notes and other financial information included elsewhere in this Quarterly Report on Form 10-Q (this “Report”). Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors. Please see “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in this Report. Unless the context otherwise requires, references in this section of the Report to “we,” “us,” “Adagio,” and “the Company” refer to the business and operations of Adagio Medical Holdings, Inc. and its consolidated subsidiaries. References to our “management” or our “management team” refer to our officers and directors.

Previous wording

We are a medical device company focused on developing and commercializing products for the treatment of cardiac arrhythmias with our novel, proprietary, catheter-based Ultra-Low Temperature Cryoablation (“ULTC”) technology. Our initial focus is on the treatment of ventricular tachycardia (“VT”). VT is a rapid, abnormal heart rhythm, or arrhythmia, that originates in the heart's lower chambers, or ventricles, potentially leading to impaired blood flow and, if sustained, VT can be fatal. VT-associated sudden cardiac death (“SCD”) accounts for approximately 300,000 deaths each year in the U.S. Radio Frequency (“RF”) ablation catheters currently used to treat VT were primarily designed and approved for the treatment of atrial fibrillation (“AF”) and are therefore not designed to optimally treat the specifics of the ventricular anatomy and disease. As a result, VT procedures performed with current devices can be overly complex and can lead to sub-optimal outcomes, factors that have potentially led to the limited growth in the market for VT ablations.

Current wording

We are a medical device company focused on developing and commercializing products for the treatment of cardiac arrhythmias with our novel, proprietary, catheter-based Ultra-Low Temperature Ablation (“ULTA”) technology. Our initial focus is on the treatment of ventricular tachycardia (“VT”). VT is a rapid, abnormal heart rhythm, or arrhythmia, that originates in the heart's lower chambers, or ventricles, potentially leading to impaired blood flow and, if sustained, VT can be fatal. VT-associated sudden cardiac death (“SCD”) accounts for approximately 300,000 deaths each year in the U.S. Radio Frequency (“RF”) ablation catheters currently used to treat VT were primarily designed and approved for the treatment of atrial fibrillation (“AF”) and are therefore not designed to optimally treat the specifics of the ventricular anatomy and disease. As a result, VT procedures performed with current devices can be overly complex and can lead to sub-optimal outcomes, factors that have potentially led to the limited growth in the market for VT ablations.

Previous wording

Our clinically tested, proprietary ULTC products are purpose-built to treat patients with VT and are designed to address the unique anatomy of the ventricle and the specific needs of the VT patient. Our ULTC approach is built on the hypothesis that large and durable lesions extending through the depth of both diseased and healthy muscular tissue of the ventricle of the heart (ventricular myocardium) is a foundation for improving the effectiveness of VT ablations and patient outcomes. Our differentiated catheters are designed for large, durable, deep lesions within the ventricle through an endocardial approach with no required irrigation. In October 2025, we announced completion of enrollment in our FULCRUM-VT Pivotal U.S. Food and Drug Administration (“FDA”) Investigational Device Exemption (“IDE”) study evaluating the vCLASTM Cryoablation System for ablation of monomorphic ventricular tachycardia (MMVT) in patients with both ischemic and nonischemic cardiomyopathy. The vCLAS System, which was granted Breakthrough Device Designation by the FDA in April 2025, is built on the Company’s proprietary ULTC technology platform.

Current wording

Our clinically tested, proprietary ULTA products are purpose-built to treat patients with VT and are designed to address the unique anatomy of the ventricle and the specific needs of the VT patient. Our ULTA approach is built on the hypothesis that large and durable lesions extending through the depth of both diseased and healthy muscular tissue of the ventricle of the heart (ventricular myocardium) is a foundation for improving the effectiveness of VT ablations and patient outcomes. Our differentiated catheters are designed for large, durable, deep lesions within the ventricle through an endocardial approach with no required irrigation. In October 2025, we announced completion of enrollment in our FULCRUM-VT Pivotal U.S. Food and Drug Administration (“FDA”) Investigational Device Exemption (“IDE”) study evaluating the vCLASTM Ventricular Ablation System for treatment of monomorphic ventricular tachycardia (“MMVT”) in patients with both ischemic and nonischemic cardiomyopathy. The vCLAS System, which was granted Breakthrough Device Designation by the FDA in April 2025, is built on the Company’s proprietary ULTA technology platform.

Previous wording

We have established a robust cadence of clinical data designed to evaluate our technology and gain regulatory approvals of our product portfolio. Preliminary data suggest that our approach to treating VT offers a favorable combination of safety, acute and chronic effectiveness, compared to the current standard of care, including ablations performed using radiofrequency (“RF”) and pulsed field ablation (“PFA”) energy. Our first-in-human CRYOCURE-VT trial included 64 patients in nine centers in the European Union and Canada. The outcomes of this trial, which were used to support CE Mark approval, include a 0% rate of major adverse events, 94% acute procedural success, 60% freedom from sustained VT and 81% freedom from implantable cardioverter defibrillator (“ICD”) shock at six months. Our vCLASTM. Cryoablation System for VT has obtained European CE Mark approval. In the United States, our 209-patient FULCRUM-VT IDE pivotal clinical trial completed enrollment in October 2025 across nineteen (19) centers in the United States and Canada. The study includes patients with both ischemic (“ICM”) and non-ischemic (“NICM”) cardiomyopathies (LVEF=35+/-10%, 33% NICM, 75% with congestive heart failure). In our preliminary acute safety and efficacy results, acute clinical success, defined as non-inducibility of target ventricular arrhythmias, was 97.4%, with all clinically-relevant VTs eliminated in 96.7% of patients tested by post-ablation programmed electrical stimulation. Key safety findings included a 2.5% rate of major adverse events including four (1.9%) peri-procedural deaths, of which one (0.5%) was adjudicated by an independent clinical events committee as definitely related to the investigational device. We plan to submit the results of this trial to support our application for U.S. Food and Drug Administration (“FDA”) approval of our vCLASTM Cryoablation System in the first half of 2026, and to share our six-month primary efficacy endpoint results of the FULCRUM-VT trial in April 2026 at the Heart Rhythm 2026 Conference.

Current wording

We have established a robust cadence of clinical data designed to evaluate our technology and gain regulatory approvals of our product portfolio. Preliminary data suggest that our approach to treating VT offers a favorable combination of safety, acute and chronic effectiveness, compared to the current standard of care, including ablations performed using RF and pulsed field ablation (“PFA”) energy. Our first-in-human CRYOCURE-VT trial included 64 patients in nine centers in the European Union and Canada. The outcomes of this trial, which were used to support CE Mark approval, include a 0% rate of major adverse events, 94% acute procedural success, 60% freedom from sustained VT and 81% freedom from implantable cardioverter defibrillator (“ICD”) shock at six months. Our vCLASTM. Ventricular Ablation System for VT obtained European CE Mark approval in March 2024. In the United States, our 209-patient FULCRUM-VT IDE pivotal clinical trial completed enrollment in October 2025 across nineteen (19) centers in the United States and Canada. The study includes patients with both ischemic (“ICM”) and non-ischemic (“NICM”) cardiomyopathies (LVEF=35+/-10%, 33% NICM, 75% with congestive heart failure). In our preliminary acute safety and efficacy results, acute clinical success, defined as non-inducibility of target ventricular arrhythmias, was 97.4%, with all clinically-relevant VTs eliminated in 96.7% of patients tested by post-ablation programmed electrical stimulation. Key safety findings included a 2.5% rate of major adverse events including four (1.9%) peri-procedural deaths, of which one (0.5%) was adjudicated by an independent clinical events committee as definitely related to the investigational device. We plan to submit the results of this trial to support our application for FDA approval of our vCLASTM Ventricular Ablation System in the first half of 2026, and to share our six-month primary efficacy endpoint results of the FULCRUM-VT trial in April 2026 at the Heart Rhythm 2026 Conference.

Previous wording

We are also currently developing a next generation ULTC technology for VT. This catheter, which requires only a single freeze, is being designed to improve customer usability and integration with the existing ablation laboratory workflow. The next-generation catheter features a more flexible, smaller diameter shaft that is compatible with the industry-standard 8.5 Fr sheaths, and is designed to operate at lower ablation temperatures resulting in the shorter, single-freeze ablation protocol. We are currently in the design phase with this device.

Current wording

We are also currently developing a next generation ULTA technology for VT. We received IDE approval from the FDA in April 2026 to expand the Company’s FULCRUM-VT trial to evaluate the safety and effectiveness of our next-generation vCLAS ULTA Ventricular Ablation System for the treatment of Sustained Monomorphic Ventricular Tachycardia (“SMVT”). The next-generation catheter, which requires only a single freeze, is being designed to improve customer usability and integration with the existing ablation laboratory workflow. The next-generation catheter features a more flexible, smaller diameter shaft that is compatible with the industry-standard 8.5 Fr sheaths, and is designed to operate at lower ablation temperatures resulting in the shorter, single-freeze ablation protocol.

Previous wording

We have also developed a technology that utilizes ULTC in combination with PFA, which we call Pulsed Field Cryoablation (“PFCA”). Early demonstration of PFCA technology has been performed in the European PARALELL trial in patients with persistent atrial fibrillation and in preclinical studies targeting VT ablations.

Current wording

We have also developed a technology that utilizes ULTA in combination with PFA, which we call Pulsed Field Cryoablation (“PFCA”). Early demonstration of PFCA technology has been performed in the European PARALELL trial in patients with persistent atrial fibrillation and in preclinical studies targeting VT ablations.

Previous wording

We have incurred net losses each year since our inception in 2011. As of September 30, 2025, and December 31, 2024, we had an accumulated deficit of $92.3 million and $70.6 million, respectively. For the three and nine months ended September 30, 2025 (Successor), and for the periods from July 31, 2024 to September 30, 2024 (Successor), and January 1, 2024 to July 30, 2024 (Predecessor), net (loss) income was $(10.1) million, $(21.8) million, $3.6 million, and $(21.3) million, respectively. The net cash used in operating activities was $14.9 million, $6.4 million, and $16.0 million respectively. Substantially all of our accumulated deficit has resulted from costs incurred in connection with our research and development programs and from general and administrative costs associated with our operations. As of September 30, 2025, and December 31, 2024, we had cash of $4.7 million and $20.6 million, respectively.

Current wording

We have incurred net losses each year since our inception in 2011. As of March 31, 2026, and December 31, 2025, we had an accumulated deficit of $102.6 million and $95.6 million, respectively. For the three months ended March 31, 2026, and March 31, 2025, net loss was $7.0 million and $7.7 million, respectively. The net cash used in operating activities was $4.1 million and $7.2 million, respectively. Substantially all of our accumulated deficit has resulted from costs incurred in connection with our research and development programs and from general and administrative costs associated with our operations. As of March 31, 2026, and December 31, 2025, we had cash of $12.9 million and $17.1 million, respectively.

Previous wording

As of the report date, we believe our existing cash and cash equivalents, including the proceeds received from the Private Placement, are sufficient to fund our operating and capital expenditure requirements for at least 12 months from the date of issuance of the unaudited interim condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. If our available cash and cash equivalents are insufficient to satisfy our liquidity requirements, we may need to raise additional capital to fund our operations. No assurance can be given as to whether additional needed financing will be available on terms acceptable to us, if at all. If sufficient funds on acceptable terms are not available when needed, we may be required to suspend or forego certain planned activities. Failure to manage discretionary spending or raise additional financing, as needed, would adversely impact our ability to achieve our intended business objectives and have an adverse effect on our results of operations and future prospects. Refer toNote 1 - Organization and Description of Businessin our condensed consolidated financial statements for additional information on the going concern assessment.

Current wording

As of the report date, we do not believe our existing cash and cash equivalents are sufficient to fund our operating and capital expenditure requirements for at least 12 months from the date of issuance of the audited consolidated financial statements included in this Report. Based on our current research and development plans, we expect to have sufficient resources to fund our planned operations into the third quarter of 2026. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our capital resources sooner than expected. No assurance can be given as to whether additional needed financing will be available on terms acceptable to us, if at all. If sufficient funds on acceptable terms are not available when needed, we may be required to suspend or forego certain planned activities. Failure to manage discretionary spending or raise additional financing, as needed, could adversely impact our ability to achieve our intended business objectives and may have an adverse effect on our results of operations and future prospects. These factors raise substantial doubt about our ability to continue as a going concern for the twelve-month period from the date of this filing with the SEC. Refer toNote 1 - Description of Organization and Business Operations in our condensed consolidated financial statements for additional information on the going concern assessment.

Previous wording

Pursuant to the Business Combination Agreement, on the Closing Date, (i) ARYA Merger Sub merged with and into ARYA (the “ARYA Merger”) and Company Merger Sub merged with and into Legacy Adagio (the “Adagio Merger” and, together with the ARYA Merger, the “Mergers”), with ARYA and Legacy Adagio surviving the Mergers and, after giving effect to such Mergers, each of ARYA and Legacy Adagio becoming a wholly owned subsidiary of ListCo (the time that the ARYA Merger becomes effective being referred to as the “ARYA Merger Effective Time,” the time that the Adagio Merger becomes effective being referred to as the “Adagio Merger Effective Time,” the time after which both Mergers become effective being referred to as the “Closing,” and the date on which the Closing occurs being referred to as the “Closing Date”), (ii) ListCo filed with the Secretary of State of the State of Delaware an amended and restated certificate of incorporation of ListCo, and the board of directors of ListCo approved and adopt amended and restated bylaws of ListCo, and (iii) ListCo changed its name to Adagio Medical Holdings, Inc.

Current wording

Pursuant to the Business Combination Agreement, on the Closing Date, (i) ARYA Merger Sub merged with and into ARYA (the “ARYA Merger”) and Company Merger Sub merged with and into Legacy Adagio (the “Adagio Merger” and, together with the ARYA Merger, the “Mergers”), with ARYA and Legacy Adagio surviving the Mergers and, after giving effect to such Mergers, each of ARYA and Legacy Adagio becoming a wholly owned subsidiary of ListCo (the time that the ARYA Merger became effective being referred to as the “ARYA Merger Effective Time,” the time that the Adagio Merger became effective being referred to as the “Adagio Merger Effective Time,” the time after which both Mergers became effective being referred to as the “Closing,” and the date on which the Closing occurred being referred to as the “Closing Date”), (ii) ListCo filed with the Secretary of State of the State of Delaware an amended and restated certificate of incorporation of ListCo, and the board of directors of ListCo approved and adopted amended and restated bylaws of ListCo, and (iii) ListCo changed its name to Adagio Medical Holdings, Inc.

Previous wording

We generate product revenue primarily from the sale of the catheters used with our consoles. We sell our products directly to hospitals and medical centers. To a lesser extent, we also generate lease revenue from the implied rental of consoles loaned to customers at no charge. We recognize revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers, when we transfer promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Please refer toNote 2 - Summary of Significant Accounting Policies in our condensed consolidated financial statements for additional details on our revenue recognition policy. Our revenue is subject to fluctuation due to the foreign currency in which our products are sold.

Current wording

Historically, we have generated product revenue primarily from the sale of the catheters used with our consoles. We have sold our products directly to hospitals and medical centers. To a lesser extent, we also generated lease revenue from the implied rental of consoles loaned to customers at no charge. We recognize revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers, when we transfer promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Please refer toNote 2 - Summary of Significant Accounting Policies in our condensed consolidated financial statements for additional details on our revenue recognition policy. Our revenue is subject to fluctuation due to the foreign currency in which our products are sold.

Previous wording

Cost of revenue includes raw materials, direct labor, manufacturing overhead, shipping and receiving costs and other less significant indirect costs related to the production of our products. Cost of revenue also includes the depreciation expense of consoles loaned to the customers.

Current wording

Cost of revenue includes raw materials, direct labor, manufacturing overhead, shipping and receiving costs and other less significant indirect costs related to the production of our products. Cost of revenue also includes the depreciation expense of consoles loaned to the customers. Such ongoing cost is presented with research and development cost for the period ended March 31, 2026.

Previous wording

Management expects the research and development expenses to increase in future periods, as we will incur incremental expenses associated with our ULTC products that are currently under development and in pre-clinical and clinical trials. Product candidates in later stages of clinical development generally have higher development costs, primarily due to the increased size and duration of later-stage clinical trials.

Current wording

Management expects the research and development expenses to increase in future periods, as we will incur incremental expenses associated with our ULTA products that are currently under development and in pre-clinical and clinical trials. Product candidates in later stages of clinical development generally have higher development costs, primarily due to the increased size and duration of later-stage clinical trials.

Previous wording

Selling, general and administrative expenses consist primarily of salaries, and employee-related costs (including stock-based compensation) for personnel in executive, finance and other administrative functions, allocated rent and facilities costs, legal fees relating to corporate matters, professional fees for accounting and consulting services, public company costs, insurance costs, and marketing costs. We expense all selling, general and administrative costs as incurred. We expect our selling, general and administrative expenses to decrease slightly for the full year 2025 compared to the full year 2024. This anticipated decrease is primarily due to lower payroll and personnel expenses resulting from the corporate prioritization initiative implemented on February 28, 2025, as well as the absence of transaction-related costs incurred in connection with the Business Combination completed in 2024. In future periods we expect our selling, general and administrative expenses to increase as we continue to expand on our operations and grow our business.

Current wording

Selling, general, and administrative expenses consist primarily of salaries, and employee-related costs (including stock-based compensation) for personnel in executive, finance and other administrative functions, allocated rent and facilities costs, legal fees relating to corporate matters, professional fees for accounting and consulting services, public company costs, insurance costs, and marketing costs. We expense all selling, general, and administrative costs as incurred. In future periods we expect our selling, general, and administrative expenses to increase as we continue to expand on our operations and grow our business.

Previous wording

We recorded the October 2022 (the “October 2022 Convertible Notes”), April 2023 (the “April 2023 Convertible Notes”), November 2023 (the “November 2023 Convertible Notes”), February 2024 (the “February 2024 Convertible Notes”, or the “2024 Bridge Financing Notes”), May 2024 (the “May 2024 Convertible Notes”), June 2024 (the “June 2024 Convertible Notes”), and July 2024 (the “July 2024 Convertible Notes”) (collectively, “Legacy Adagio Convertible Notes”), at fair value at issuance and subsequently remeasure them to fair value at each reporting period. The change in fair value of the Convertible Securities Notes, including amounts related to interest, is recorded in “Convertible notes fair value adjustment.”

Current wording

The change in fair value of the Convertible Securities Notes (as defined below), including amounts related to interest, is recorded in “Convertible notes fair value adjustment.”

Previous wording

Further, in connection with the execution of the Business Combination Agreement, certain investors (“Convert Investors”) executed a securities purchase agreement, dated February 13, 2024, with ListCo (the “Convertible Security Subscription Agreement”), pursuant to which ListCo issued on the Closing Date to the Convert Investors $20.0 million of 13% senior secured convertible notes (the “Convertible Securities Notes”), which were converted into shares of the Company’s common stock at a conversion price of $10.00 per share, subject to adjustment, and 1,500,000 warrants (the “Convert Warrants”), each Convert Warrant being exercisable on a cashless basis or for cash at a price of $24.00 per share, subject to adjustment. Such $20.0 million of financing in the form of Convertible Securities Notes includes the conversion of the February 2024 Convertible Notes (as defined below) into Convertible Securities Notes and Convert Warrants at Closing. Refer toNote 9 - Debt in our condensed consolidated financial statements for additional details.

Current wording

In connection with the execution of the Business Combination Agreement, certain investors (the “Convert Investors”) executed a securities purchase agreement dated February 13, 2024, with ListCo (the “Convertible Security Subscription Agreement”), pursuant to which ListCo issued on the Closing Date to the Convert Investors $20.0 million of 13% senior secured notes (the “Convertible Securities Notes”), which may be convertible into shares of the Company’s common stock at a conversion price of $10.00 per share, subject to adjustment, and 1,500,000 warrants (the “Convert Warrants”), each Convert Warrant being exercisable on a cashless basis or for cash at a price of $24.00 per share, subject to adjustment. Such $20.0 million of financing in the form of Convertible Securities Notes includes the conversion of the February 2024 Convertible Notes into Convertible Securities Notes and Convert Warrants at Closing.

Previous wording

We accounted for certain common stock warrants outstanding as warrant liabilities at fair value, determined using the Black-Scholes-Merton option pricing model. The liability is subject to remeasurement at each reporting period and any change in fair value is recognized as warrant liabilities fair value adjustment in the condensed consolidated statements of operations and comprehensive loss (income).

Current wording

We accounted for certain common stock warrants outstanding as warrant liabilities at fair value, determined using the Black-Scholes-Merton option pricing model. The liability is subject to remeasurement at each reporting period and any change in fair value is recognized as warrant liabilities fair value adjustment in the condensed consolidated statements of operations and comprehensive loss.

Previous wording

Interest expense is primarily incurred from our outstanding debt obligations, including those under the October 2022 Convertible Notes, the Bridge Financing Notes, the Convertible Securities Notes and the SVB Term Loan (as defined below).

Current wording

Interest expense is primarily incurred from our outstanding debt obligations under the Convertible Securities Notes.

Previous wording

Other (expense) income, net primarily consists of foreign currency unrealized and realized gain / loss, and other income related to our research and development (“R&D”) tax credit.

Current wording

Other income (expense) income, net primarily consists of foreign currency unrealized and realized gain/loss, and other income related to our research and development (“R&D”) tax credit.

Previous wording

Our clinical trial expenses relate to trials for our iCLAS atrial ULTC catheter and system (CYROCURE-2), iCLAS atrial ULTC catheter and system (iCLAS for persistent atrial fibrillation), vCLAS ventricular ULTC catheter (CYROCURE-VT), vCLAS ventricular ULTC catheter (FULCRUM-VT), and PFCA catheter. Clinical trial costs include the expenses spent on clinical trial studies and other related expenses. Quality assurance includes regulatory fees and third-party service fees. Pre-clinical trial costs and other research and development costs include the expenses resulting from professional fees, prototypes, and animal testing. Operational costs include the expenses spent on product manufacturing.

Current wording

Our clinical trial expenses relate to trials for our iCLAS atrial ULTA catheter and system (CYROCURE-2), iCLAS atrial ULTA catheter and system (iCLAS for persistent atrial fibrillation), vCLAS ventricular ULTA catheter (CYROCURE-VT), vCLAS ventricular ULTA catheter (FULCRUM-VT), and PFCA catheter. Clinical trial costs include the expenses related to clinical trial studies and other related expenses. Quality assurance includes regulatory fees and third-party service fees. Pre-clinical trial costs and other research and development costs include the expenses resulting from professional fees, prototypes, and animal testing. Operational costs include expenses related to product manufacturing.

Previous wording

The change in fair value of warrant liabilities resulted in a loss of $0.2 million for the three months ended September 30, 2025, compared to a gain of $5.0 million and $0.2 million for the periods from July 31, 2024 to September 30, 2024 (Successor) and from July 1, 2024 to July 30, 2024 (Predecessor), respectively.

Current wording

The change in convertible notes fair value resulted in a loss of $1.1 million for the three months ended March 31, 2026, compared to a gain of $0.2 million for the three months ended March 31, 2025.

Previous wording

The change in fair value of warrant liabilities resulted in a loss of $0.3 million for the nine months ended September 30, 2025, compared to a gain of $5.0 million and $0.2 million for the periods from July 31, 2024 to September 30, 2024 (Successor) and from January 1, 2024 to July 30, 2024 (Predecessor), respectively.

Current wording

The change in fair value of warrant liabilities resulted in a loss of $131 thousand for the three months ended March 31, 2026, compared to a gain of $38 thousand for the three months ended March 31, 2025.

Previous wording

Interest expense was $0.7 million for the three months ended September 30, 2025 (Successor) and $0.4 million and $0.3 million for the period from July 31, 2024 to September 30, 2024 (Successor) and from July 1, 2024 to July 30, 2024 (Predecessor), respectively. The increase of $10 thousand, or 1.4%, was related to interest incurred from the convertible promissory notes issued in April 2023, November 2023, February 2024, May 2024, June 2024, July 2024 Notes, and the Convertible Securities Notes.

Current wording

Interest expense was $0.8 million for the three months ended March 31, 2026, compared to $0.7 million for the three months ended March 31, 2025, representing an increase of $0.1 million, or 18%. The increase was related to interest incurred from the Convertible Securities Notes.

Previous wording

Interest income was $79.0 thousand for the three months ended September 30, 2025 (Successor) and $0.2 million and nil for the period from July 31, 2024 to September 30, 2024 (Successor) and from July 1, 2024 to July 30, 2024 (Predecessor), respectively. The decrease in interest income of $87.0 thousand was primarily due to the decrease of cash balances in an asset management account.

Current wording

Interest income was $107 thousand for the three months ended March 31, 2026, compared to $164 thousand for the three months ended March 31, 2025, representing a decrease of $57 thousand, or 35%. The decrease was due to interest income on cash balances in an asset management account.

Previous wording

Other income, net was $0.2 million for the nine months ended September 30, 2025 (Successor) and other income was $72.0 thousand and other expense was $33.0 thousand for the period from July 31, 2024 to September 30, 2024 (Successor) and from January 1, 2024 to July 30, 2024 (Predecessor), respectively. This net increase in other income of $0.1 million was primarily attributable to foreign currency unrealized and realized gain.

Current wording

Other income, net was $70.0 thousand for the three months ended March 31, 2026, compared to other expense, net of $46.0 thousand for the three months ended March 31, 2025, representing an increase of $0.1 million. The net increase in other income of $0.1 million was primarily attributable to foreign currency unrealized and realized loss.

Previous wording

To date, we have financed our operations primarily through the sale of equity securities, convertible promissory notes and the SVB Term Loan (as defined below). In connection with the closing of the Business Combination on July 31, 2024, we received net proceeds of $84.2 million. Since inception we have incurred operating losses and negative cash flows and anticipate continuing to do so for at least the next several years.

Current wording

To date, we have financed our operations primarily through the sale of equity securities, convertible promissory notes and an initial term loan advance of $3.0 million and a right to borrow a subsequent term loan advance of $2.0 million with Silicon Valley Bank (the “SVB Term Loan”). In connection with the closing of the Business Combination on July 31, 2024, we received net proceeds of $84.2 million. Since inception we have incurred operating losses and negative cash flows and anticipate continuing to do so for at least the next several years.

Previous wording

On October 14, 2025, we entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain accredited healthcare investors (the “Purchasers”) pursuant to which we issued and sold to the Purchasers in a private placement (the “Private Placement”): (i) 9,792,506 shares (the “Shares”) of our common stock, par value $0.0001 per share (the “Common Stock”), or pre-funded warrants (the “Pre-Funded Warrants”) to purchase shares of Common Stock in lieu thereof, and (ii) accompanying (a) Tranche A Warrants to purchase an aggregate of 6,012,943 shares of Common Stock (or pre-funded warrants in lieu thereof) (the “Tranche A Warrants”), Tranche B Warrants to purchase an aggregate of 6,012,943 shares of Common Stock (or pre-funded warrants in lieu thereof) (the “Tranche B Warrants”) and Tranche C Warrants to purchase an aggregate of 6,012,943 shares of Common Stock (or pre-funded warrants in lieu thereof) (the “Tranche C Warrants” and, together with the Tranche A and Tranche B Warrants, the “Milestone Warrants”), for aggregate gross proceeds of approximately $19 million (excluding up to approximately $31 million of aggregate gross proceeds that may be received in the future upon the cash exercise in full of the Milestone Warrants issued in the Private Placement), before deducting placement agent fees and other expenses payable by us. Each Share and each Pre-Funded Warrant sold pursuant to the Securities Purchase Agreement was accompanied by one Tranche A Warrant, one Tranche B Warrant and one Tranche C Warrant. The combined purchase price of each Share and accompanying Milestone Warrants is $1.9403 and (which includes $0.2303 for the Milestone Warrants sold with each Share in accordance with the rules and regulations of The Nasdaq Stock Market LLC). The combined purchase price of each Pre-Funded Warrant and accompanying Milestone Warrant is $1.9402 (equal to the combined purchase price per Share and accompanying Milestone Warrants, minus $0.001). Entities affiliated with Perceptive Advisors LLC, an affiliate of the Company, purchased Pre-Funded Warrants and Milestone Warrants for an aggregate purchase price of $4,250,000.

Current wording

On October 14, 2025, we entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain accredited healthcare investors (the “Purchasers”) pursuant to which we issued and sold to the Purchasers in a private placement (the “Private Placement”): (i) 9,792,506 shares (the “Shares”) of our common stock, par value $0.0001 per share (the “Common Stock”), or pre-funded warrants (the “Pre-Funded Warrants”) to purchase shares of Common Stock in lieu thereof, and (ii) accompanying (a) Tranche A Warrants to purchase an aggregate of 6,012,943 shares of Common Stock (or pre-funded warrants in lieu thereof) (the “Tranche A Warrants”), (b) Tranche B Warrants to purchase an aggregate of 6,012,943 shares of Common Stock (or pre-funded warrants in lieu thereof) (the “Tranche B Warrants”) and (c) Tranche C Warrants to purchase an aggregate of 6,012,943 shares of Common Stock (or pre-funded warrants in lieu thereof) (the “Tranche C Warrants” and, together with the Tranche A and Tranche B Warrants, the “Milestone Warrants”), for aggregate gross proceeds of approximately $19 million (excluding up to approximately $31 million of additional aggregate gross proceeds that may be received in the future upon the cash exercise in full of the Milestone Warrants issued in the Private Placement), before deducting placement agent fees and other expenses payable by us. Each Share and each Pre-Funded Warrant sold pursuant to the Securities Purchase Agreement was accompanied by one Tranche A Warrant, one Tranche B Warrant and one Tranche C Warrant. The combined purchase price of each Share and accompanying Milestone Warrants is $1.9403 (which includes $0.2303 for the Milestone Warrants sold with each Share in accordance with the rules and regulations of The Nasdaq Stock Market LLC). The combined purchase price of each Pre-Funded Warrant and accompanying Milestone Warrant is $1.9402 (equal to the combined purchase price per Share and accompanying Milestone Warrants, minus $0.0001). Entities affiliated with Perceptive Advisors LLC, an affiliate of ours, purchased Pre-Funded Warrants and Milestone Warrants for an aggregate purchase price of $4,250,000.

Previous wording

We believe that our existing cash and cash equivalents, including the anticipated net proceeds from the Private Placement, will enable us to fund our ongoing development and submission activities to support FDA evaluation of our first and next generation ULTC products. We will require additional capital to fund continued clinical activities for our next generation product, to fund our manufacturing activities, to fund precommercial activities of our programs and for working capital and general corporate purposes. The assessment of our ability to meet our future obligations is inherently judgmental, subjective and susceptible to change. Based on our current forecast, we believe that we will have sufficient cash to maintain our planned operations for the next twelve months following the issuance of these condensed consolidated financial statements.

Current wording

We believe that our existing cash and cash equivalents will enable us to fund our ongoing development and submission activities to support FDA evaluation of our first and next generation ULTA products. We will require additional capital to fund continued clinical activities for our next-generation product, to fund our manufacturing activities, to fund precommercial activities of our programs and for working capital and general corporate purposes. The assessment of our ability to meet our future obligations is inherently judgmental, subjective and susceptible to change. Based on our current research and development plans, we expect to have sufficient resources to fund our planned operations into the third quarter of 2026.

Previous wording

Net cash used in operating activities for the period from January 1, 2024 to July 30, 2024 (Predecessor) was $16.0 million consisting primarily of a net loss of $21.3 million, adjusted by non-cash items of $0.8 million, and net changes in our operating assets and liabilities of $6.1 million. Non-cash items primarily consisted of $0.6 million in depreciation and amortization, $0.6 million in stock-based compensation, noncash operating lease expense of $0.1 million, and loss on disposal of property and equipment of $0.1 million; offset by a gain of $2.1 million from the change in fair value of convertible notes payable, and a gain of $0.2 million from the change in fair value of warrant liabilities. Changes in our net operating assets and liabilities were primarily due to a $7.4 million increase in accrued transaction costs, the increase in accrued liabilities of $0.5 million and a $1.7 million increase in other accrued liabilities, which were primarily driven by the increase in transaction costs related to the Business Combination, the increase in accrued variable compensation related to the Business Combination, and the increase in interest related the convertible notes; offset by a $2.6 million decrease in accounts payable, $0.8 million increase in inventory, which were primarily driven by the payment of accounts payable related to the Business combination and an increase in inventory purchases.

Current wording

Net cash used in operating activities for the three months ended March 31, 2026 was $4.1 million, consisting primarily of a net loss of $7.0 million, adjusted by non-cash items of $1.8 million and net changes in operating assets and liabilities of $1.1 million. Non-cash items primarily consisted of $0.2 million in depreciation and amortization, $0.4 million in stock-based compensation, $1.1 million from the change in fair value of convertible notes payable, and $0.1 million from the change in fair value of warrant liabilities. Changes in operating assets and liabilities included a $0.8 million increase in other accrued liabilities, a $0.1 million increase in accrued liabilities, and a $0.1 million increase in accounts payable.

Previous wording

Net cash used in operating activities for the nine months ended September 30, 2025 (Successor) was $14.9 million, consisting primarily of a net loss of $21.8 million, adjusted by non-cash items of $4.0 million and net changes in operating assets and liabilities of $2.9 million. Non-cash items primarily consisted of $0.7 million in depreciation, $0.6 million in stock-based compensation, a loss on disposal of property and equipment of $0.5 million, a change in fair value of convertible notes payable of $1.9 million, and a change in fair value of warrant liabilities of $0.3 million. Changes in operating assets and liabilities were primarily driven by a $4.8 million increase in accrued liabilities, a $2.1 million increase in other accrued liabilities, a $1.1 million decrease in inventory, and a $0.3 million decrease in prepaid expenses and other current assets, partially offset by a $3.6 million decrease in other long-term liabilities and a $1.8 million decrease in accounts payable.

Current wording

Net cash used in operating activities for the three months ended March 31, 2025 was $7.2 million, consisting primarily of a net loss of $7.7 million, adjusted by non-cash items of $0.2 million and net changes in operating assets and liabilities of $0.2 million. Non-cash items primarily consisted of $0.3 million in depreciation and amortization, $0.2 million in stock-based compensation, and a $0.2 million net gain from the change in fair value of convertible notes payable. Changes in operating assets and liabilities included a $0.3 million increase in inventory and a $0.6 million decrease in accrued liabilities, partially offset by a $0.7 million increase in other accrued liabilities.

Previous wording

Net cash used in investing activities for the nine months ended September 30, 2025 (Successor) was $0.9 million. Net cash used in investing activities for the periods from July 31, 2024 to September 30, 2024 (Successor) and January 1, 2024 to July 30, 2024 (Predecessor) was $0.6 million and $0.4 million, respectively. The increase was primarily due to higher purchases of property and equipment during the period.

Current wording

Net cash used in investing activities for the three months ended March 31, 2026 and the three months ended March 31, 2025 was $2 thousand and $0.3 million, respectively. The decrease in cash used in investing activities was due to the decrease in purchases of property.

Previous wording

Cash Flow Provided by Financing Activities

Current wording

Cash Flow Provided by (Used in) Financing Activities

Previous wording

Net cash provided by financing activities for the nine months ended September 30, 2025 (Successor) was nil.

Current wording

Net cash provided by (used in) financing activities for the three months ended March 31, 2026 and 2025 was nil.

Previous wording

During the three months ended September 30, 2025, there have been no material changes to our critical accounting policies from those disclosed in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the 2024 Annual Report, except as noted below.

Current wording

During the three months ended March 31, 2026, there have been no material changes to our critical accounting policies from those disclosed in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the 2025 Annual Report.