Orchestra BioMed Holdings, Inc.

Previous wording

AVIM Therapy is a bioelectronic treatment for hypertension (“HTN”), the leading risk factor for death worldwide, and is designed to be delivered by a pacemaker and achieve immediate, substantial and sustained reductions in blood pressure in patients with hypertensive heart disease. We have an exclusive license and collaboration agreement with Medtronic Inc. (an affiliate of Medtronic plc) (“Medtronic”), one of the largest medical device companies in the world and the global leader in cardiac pacing therapies, for the development and commercialization of AVIM Therapy for the treatment of uncontrolled HTN in patients indicated for a cardiac pacemaker. We are actively conducting a double-blind, randomized, global pivotal trial (the “BACKBEAT Trial”), enrolling up to 316 patients with uncontrolled hypertension who are indicated for a dual-chamber pacemaker, with enrollment currently targeted to be completed by the end of the third quarter of 2026. AVIM Therapy has FDA Breakthrough Device Designations (“BDDs”) for these patients, as well as an estimated 7.7 million total patients in the U.S. with uncontrolled hypertension despite medical therapy and increased cardiovascular risk.

Current wording

AVIM Therapy is a bioelectronic treatment for hypertension (“HTN”), the leading risk factor for death worldwide, and is designed to be delivered by a pacemaker and achieve immediate, substantial and sustained reductions in blood pressure in patients with hypertensive heart disease. We have an exclusive license and collaboration agreement with Medtronic Inc. (an affiliate of Medtronic plc) (“Medtronic”), one of the largest medical device companies in the world and the global leader in cardiac pacing therapies, for the development and commercialization of AVIM Therapy for the treatment of uncontrolled HTN in patients indicated for a cardiac pacemaker. We are actively conducting a double-blind, randomized, global pivotal trial (the “BACKBEAT Trial”), enrolling 284 evaluable randomized patients with uncontrolled HTN who are indicated for a dual-chamber pacemaker, with enrollment currently targeted to be completed by the end of the third quarter of 2026. Assuming primary endpoints are met, we and Medtronic intend to submit primary endpoint data as a late-breaking clinical trial presentation at a major cardiovascular conference in the second quarter of 2027, followed by marketing application submissions to the FDA and global regulatory agencies. AVIM Therapy has received FDA Breakthrough Device Designations (“BDDs”) for the pacemaker indicated group studied in the BACKBEAT Trial and an estimated 7.7 million total patients in the U.S. with uncontrolled hypertension despite medical therapy and increased cardiovascular risk.

Previous wording

Virtue SAB is a highly differentiated, first-of-its-kind non-coated drug delivery angioplasty balloon system designed to deliver a large liquid dose of proprietary extended-release formulation of sirolimus, SirolimusEFR™, for the treatment of atherosclerotic artery disease, the leading cause of mortality worldwide. Virtue SAB has been granted BDD by the FDA for the treatment of coronary in-stent restenosis, coronary small vessel disease and below-the-knee peripheral artery disease, in each case, within specified parameters. We initiated patient enrollments in the Virtue SAB in the Treatment of Coronary In-Stent Restenosis (“ISR”) Trial (the “Virtue Trial”) for our U.S. investigational device exemption (“IDE”) pivotal study randomizing Virtue SAB vs. Boston Scientific Corporation’s AGENT™ drug-coated balloon. Designed to support regulatory approval of Virtue SAB, the Virtue Trial is expected to enroll 740 patients in the United States with enrollment completion currently planned for 2027. We cannot provide assurance that we will be able to complete enrollment of the BACKBEAT Trial or the Virtue Trial in the timeframes we anticipate.

Current wording

Virtue SAB is a highly differentiated, first-of-its-kind non-coated drug delivery angioplasty system designed to deliver a large liquid dose of our proprietary extended-release formulation of sirolimus, SirolimusEFR™, for the treatment of atherosclerotic artery disease, the leading cause of mortality worldwide. Virtue SAB has been granted BDD by the FDA for the treatment of coronary in-stent restenosis, coronary small vessel disease and below-the-knee peripheral artery disease, in each case, within specified parameters. We have initiated patient enrollments in the Virtue SAB in the Treatment of Coronary In-Stent Restenosis (“ISR”) Trial (the “Virtue Trial”) for our U.S. investigational device exemption (“IDE”) pivotal study randomizing Virtue SAB versus Boston Scientific Corporation’s AGENT™ drug-coated balloon. Designed to support regulatory approval of Virtue SAB, the Virtue Trial is expected to enroll 740 patients in the United States with enrollment completion currently planned for 2027. We cannot provide assurance that we will be able to complete enrollment of the BACKBEAT Trial or the Virtue Trial in the timeframes we anticipate.

Previous wording

Since Orchestra BioMed, Inc.’s inception, we have devoted the substantial majority of our resources to performing research and development and clinical activities in support of our product development and collaboration efforts. We have funded our operations primarily through the issuance of our common stock, convertible preferred stock, and warrants, as well as proceeds from the Business Combination, our prior Terumo Agreement (as defined below) and the Termination and ROFR Agreement (as defined below), borrowings under debt arrangements, the sale of future revenues, sale of strategic investments, and, to a lesser extent, from product revenue from our subsidiary, FreeHold Surgical, LLC. (“FreeHold”). As of March 31, 2026, we have raised a cumulative $367.2 million in gross proceeds. In May 2026, we received $20.0 million pursuant to the Medtronic Loan Agreement (as such term is defined in Note 14 to the condensed consolidated financial statements –“Debt Financing”), and $15.0 million from Ligand pursuant to the revenue participation right purchase and sale agreement (the “Royalty Purchase Agreement”) we entered into with Ligand Pharmaceuticals Incorporated (“Ligand”)(see Note 13 to the condensed consolidated financial statements –“Royalty Purchase Agreement”). We have incurred net losses each year since inception. Our net losses were $20.7 million and $18.8 million for the three months ended March 31, 2026 and 2025, respectively. We expect to continue to incur significant losses for the foreseeable future. As of March 31, 2026, we had an accumulated deficit of $383.3 million.

Current wording

Since Orchestra BioMed, Inc.’s inception, we have devoted the substantial majority of our resources to research and development and clinical activities in support of our product development and collaboration efforts. We have funded our operations primarily through the issuance of our common stock, convertible preferred stock, and warrants, as well as proceeds from the Business Combination, our prior Terumo Agreement (as defined below) and the Termination and ROFR Agreement (as defined below), borrowings under debt arrangements, the sale of future revenues, sale of strategic investments, and, to a lesser extent, product revenue from our subsidiary, FreeHold Surgical, LLC. (“FreeHold”). We had $110.0 million in cash and cash equivalents and marketable securities at June 30, 2026, comprised of $20.5 million in cash and cash equivalents and $89.5 million in marketable securities. We have incurred net losses each year since inception. Our net losses were $44.4 million and $38.1 million for the six months ended June 30, 2026 and 2025, respectively. We expect to continue to incur significant losses for the foreseeable future. As of June 30, 2026, we had an accumulated deficit of $407.0 million.

Previous wording

Orchestra BioMed, Inc., our wholly owned subsidiary, was incorporated in Delaware in 2017 and completed a recapitalization and mergers with Caliber Therapeutics, Inc., a Delaware corporation that has, among other things, the rights to the Virtue SAB product candidate and BackBeat Medical, Inc., a Delaware Corporation that has, among other things, the rights to the AVIM Therapy product candidate, in 2018. Orchestra BioMed, Inc. completed the conversions of Caliber Therapeutics, Inc. to Caliber Therapeutics, LLC, a Delaware limited liability company, and BackBeat Medical, Inc. to BackBeat Medical, LLC, a Delaware limited liability company, in 2019.

Current wording

Orchestra BioMed, Inc., our wholly owned subsidiary, was incorporated in Delaware in 2017 and completed a recapitalization and mergers with Caliber Therapeutics, Inc., a Delaware corporation that has, among other things, the rights to the Virtue SAB product candidate and BackBeat Medical, Inc., (“BackBeat”) a Delaware Corporation that has, among other things, the rights to the AVIM Therapy product candidate, in 2018. Orchestra BioMed, Inc. completed the conversions of Caliber Therapeutics, Inc. to Caliber Therapeutics, LLC, a Delaware limited liability company, and BackBeat Medical, Inc. to BackBeat Medical, LLC, a Delaware limited liability company, in 2019.

Previous wording

On July 31, 2025, we entered into a revenue participation right purchase and sale agreement (the “Royalty Purchase Agreement”) with Ligand Pharmaceuticals Incorporated (“Ligand”). Under the terms of the Royalty Purchase Agreement, in exchange for payment of $35.0 million (the “Investment Amount”), less certain reimbursable expenses, Ligand acquired the right to receive tiered royalty payments from us (the “Royalty Interest”) with respect to revenue (including certain licensing revenue) received by us in a calendar year in connection with worldwide net product sales, or other product revenue received by, by us and our licensees (“Annual Net Sales”) of (a) AVIM Therapy (the “Primary Product”) and (b) Virtue SAB (the “Secondary Product” and together with the Primary Product, the “Products”) in the field of coronary artery treatment. Our estimate of this total interest expense associated with the Royalty Interest resulted in an effective annual interest rate of approximately 23.3% as of March 31, 2026. This estimate contains significant assumptions that impact both the amount recorded at execution and the interest expense that will be recognized over the royalty period. We will periodically assess the estimated amounts due and payable to Ligand and to the extent the amount or timing of such payments is materially different than the original estimates, an adjustment will be recorded prospectively to increase or decrease interest expense. There are a number of factors that could materially affect the amount and timing of the royalty payments to be paid by us to Ligand and, correspondingly, the amount of interest expense recorded by us.

Current wording

On July 31, 2025, we entered into a revenue participation right purchase and sale agreement (the “Royalty Purchase Agreement”) with Ligand Pharmaceuticals Incorporated (“Ligand”). Under the terms of the Royalty Purchase Agreement, in exchange for payment of $35.0 million (the “Investment Amount”), less certain reimbursable expenses, Ligand acquired the right to receive tiered royalty payments from us (the “Royalty Interest”) with respect to revenue (including certain licensing revenue) received by us in a calendar year in connection with worldwide net product sales, or other product revenue received by, by us and our licensees (“Annual Net Sales”) of (a) AVIM Therapy (the “Primary Product”) and (b) Virtue SAB (the “Secondary Product” and together with the Primary Product, the “Products”) in the field of coronary artery treatment. Our estimate of this total interest expense associated with the Royalty Interest resulted in an effective annual interest rate of approximately 21.2% as of June 30, 2026. This estimate contains significant assumptions that impact both the amount recorded at execution and the interest expense that will be recognized over the royalty period. We will periodically assess the estimated amounts due and payable to Ligand and to the extent the amount or timing of such payments is materially different than the original estimates, an adjustment will be recorded prospectively to increase or decrease interest expense. There are a number of factors that could materially affect the amount and timing of the royalty payments to be paid by us to Ligand and, correspondingly, the amount of interest expense recorded by us.

Previous wording

The gain on sale of strategic investments represents a change in the preferred shares and convertible notes of Vivasure Medical Limited (“Vivasure”), a privately-held company and related party, and fair value of our investment in common stock holdings of a previously publicly-held company. On January 9, 2026, Haemonetics Corporation, a global medical technology company focused on delivering innovative solutions designed to improve patient outcomes, announced its acquisition of Vivasure. Vivasure was a strategic investment of ours prior to its acquisition. In connection with the closing of the transaction, we recognized a gain on the sale of strategic investments of $2.2 million. We may receive additional proceeds in the future associated with revenue earnouts based on the achievement of certain milestones.

Current wording

The gain on sale of strategic investments represents a change in the preferred shares and convertible notes of Vivasure Medical Limited (“Vivasure”), a privately-held company and related party, and fair value of our investment in common stock holdings of a previously publicly-held company. On January 9, 2026, Haemonetics Corporation, a global medical technology company focused on delivering innovative solutions designed to improve patient outcomes, announced its acquisition of Vivasure. Vivasure was a strategic investment of ours prior to its acquisition. In connection with the closing of the transaction, we recognized a gain on the sale of strategic investments of

Previous wording

Partnership revenue decreased by $732,000, or 100%, in the three months ended March 31, 2026 from $732,000 for the three months ended March 31, 2025. Partnership revenue related to the recognition of the combined performance obligation for the license granted to Terumo and the ongoing research and development services over the estimated performance period for the Virtue SAB coronary ISR indication, using a proportional performance model, based on the costs incurred relative to the total estimated costs of the research and development services. Prior to the termination of the Terumo Agreement, as of each quarterly reporting date, we evaluated our estimates of the total costs expected to be incurred through the completion of the combined performance obligation and updated our estimates as necessary. On October 24, 2025, we and Terumo entered into a termination and right of first refusal agreement (the “Termination and ROFR Agreement”), which superseded and terminated the Terumo Agreement, and we no longer have any performance obligations under the Terumo Agreement.

Current wording

Partnership revenue decreased by $1.4 million, or 100%, in the six months ended June 30, 2026 from $1.4 million for the six months ended June 30, 2025. Partnership revenue related to the recognition of the combined performance obligation for the license granted to Terumo and the ongoing research and development services over the estimated performance period for the Virtue SAB coronary ISR indication, using a proportional performance model, based on the costs incurred relative to the total estimated costs of the research and development services. Prior to the termination of the Terumo Agreement, as of each quarterly reporting date, we evaluated our estimates of the total costs expected to be incurred through the completion of the combined performance obligation and updated our estimates as necessary. On October 24, 2025, we and Terumo entered into a termination and right of first refusal agreement (the “Termination and ROFR Agreement”), which superseded and terminated the Terumo Agreement, and we no longer have any performance obligations under the Terumo Agreement.

Previous wording

Interest (expense) income, net, decreased by $1.0 million, or approximately 595%, to $821,000 of interest expense for the three months ended March 31, 2026, from $166,000 of income for the three months ended March 31, 2025. The net interest expense in the 2026 period consisted primarily of monthly interest expense resulting from the 2024 LSA and the Royalty Purchase Agreement partially offset by interest earned from marketable securities. The net interest income in the 2025 period consisted primarily of interest earned from marketable securities partially offset by monthly interest expense resulting from the 2024 LSA.

Current wording

Interest (expense) income, net decreased by $2.7 million, or approximately 2092%, to $2.6 million of interest expense for the six months ended June 30, 2026, from $130,000 of income for the six months ended June 30, 2025. The net interest expense in the 2026 period consisted primarily of monthly interest expense resulting from the 2024 LSA, the Medtronic Note, and the Royalty Purchase Agreement partially offset by interest earned from marketable securities. The net interest income in the 2025 period consisted primarily of interest earned from marketable securities partially offset by monthly interest expense resulting from the 2024 LSA.

Previous wording

Prior to the termination of the Terumo Agreement, as of each quarterly reporting date, we evaluated our estimates of the total costs expected to be incurred through the completion of the combined performance obligation and updated our estimates as necessary. For the three months ended March 31, 2025, the expenses incurred related to the Terumo Agreement were $3.5 million. The estimated total costs associated with the Terumo Agreement through completion as of March 31, 2025, were approximately similar as compared to the estimates as of December 31, 2024.

Current wording

For the three months ended June 30, 2025, the expenses incurred related to the Terumo Agreement were $3.3 million. The estimated total costs associated with the Terumo Agreement through completion as of June 30, 2025 were similar compared to the estimates as of March 31, 2025.

Previous wording

Cost of product revenue decreased by $12,000, or approximately 27%, to $32,000 in the three months ended March 31, 2026 from $44,000 for the three months ended March 31, 2025. The decrease was primarily due to lower sales volume of FreeHold Duo and Trio intracorporeal organ retractors.

Current wording

Cost of product revenue decreased by $21,000, or approximately 46%, to $25,000 in the three months ended June 30, 2026 from $46,000 for the three months ended June 30, 2025. The decrease was primarily due to lower sales volume of FreeHold Duo and Trio intracorporeal organ retractors.

Previous wording

Research and development expenses increased by $2.3 million, or approximately 17%, to $15.8 million for the three months ended March 31, 2026 from $13.5 million for the three months ended March 31, 2025. This is primarily due to an increase in support of ongoing work to advance the BACKBEAT Trial and to advance Virtue SAB into the Virtue Trial. The increase included an increase in personnel-related expenses of $2.1 million due to increased headcount and consulting costs, an increase of $632,000 in clinical development costs, partially offset by a decrease of $408,000 in non-clinical development costs associated with research and development program costs, supplies, and testing.

Current wording

Research and development expenses increased by $2.7 million, or approximately 20%, to $16.6 million for the three months ended June 30, 2026, from $13.9 million for the three months ended June 30, 2025. This is primarily due to an increase in support of ongoing work to advance the BACKBEAT Trial and the Virtue Trial. The increase included an increase of $2.3 million in clinical development costs and an increase in personnel-related expenses of $1.8 million due to increased headcount and consulting costs, partially offset by a decrease of $1.2 million in non-clinical development costs associated with research and development program costs, supplies, and testing. ​

Previous wording

The total research and development expenses summarized above include $3.5 million for the three months ended March 31, 2025 related to the Terumo Agreement, which was terminated in October 2025.

Current wording

The total research and development expenses summarized above include $3.3 million for the three months ended June 30, 2025 related to the Terumo Agreement, which was terminated in October 2025.

Previous wording

Selling, general and administrative expenses increased by $110,000, or approximately 2%, to $6.4 million for the three months ended March 31, 2026, from $6.3 million of expense for the three months ended March 31, 2025. The increase primarily resulted from an increase of $168,000 in accounting, finance, and legal expenses partially offset by a decrease of $85,000 in stock-based compensation.

Current wording

Selling, general and administrative expenses decreased by $435,000, or approximately 7%, to $5.8 million for the three months ended June 30, 2026, from $6.3 million of expense for the three months ended June 30, 2025. The decrease primarily resulted from a decrease of $557,000 in stock-based compensation, partially offset by an increase of $120,000 in accounting, finance, and legal expenses.

Previous wording

The derivative liability of the Series A Preferred Stock was remeasured to a fair value of $2.8 million as of March 31, 2026. We recognized a loss of $35,000 for the three months ended March 31, 2026, primarily driven by an increase in our stock price compared to the measurement at December 31, 2025.

Current wording

The derivative liability of the Series A Preferred Stock was remeasured to a fair value of $2.5 million as of June 30, 2026. We recognized a loss of $324,000 for the three months ended June 30, 2026 primarily due to changes in the fair value inputs and assumptions used in the valuation model since the measurement at March 31, 2026.

Previous wording

On January 9, 2026, Haemonetics Corporation, a global medical technology company focused on delivering innovative solutions designed to improve patient outcomes, announced its acquisition of Vivasure. In connection with the closing of the transaction, we can receive up to approximately $10.7 million of proceeds in 2026 associated with the transaction. In January, we received the initial upfront payment of $4.7 million and the remainder may be received in 2026 based on the achievement of a milestone. For the three months ended March 31, 2026, we recognized a gain on the sale of strategic investments of $2.2 million.

Current wording

On January 9, 2026, Haemonetics Corporation, a global medical technology company focused on delivering innovative solutions designed to improve patient outcomes, announced its acquisition of Vivasure. In connection with the closing of the transaction, we are eligible to receive up to approximately $10.7 million of proceeds in 2026 associated with the transaction. In January, we received the initial upfront payment of $4.7 million and an additional $45,000 during the three months ended June 30, 2026. The remainder may be received in 2026 based on the achievement of a milestone. For the three months ended June 30, 2026, we recognized a gain on the sale of strategic investments of $45,000.

Previous wording

From inception through March 31, 2026, we have incurred significant operating losses and negative cash flows from our operations. Our net losses were $20.7 million and $18.8 million for the three months ended March 31, 2026 and 2025, respectively. As of March 31, 2026, we had an accumulated deficit of $383.3 million. We have funded our operations primarily through the issuance of our common stock, convertible preferred stock, and warrants, as well as proceeds from the Business Combination, the prior Terumo Agreement and the Termination and ROFR Agreement, borrowings under debt arrangements, the sale of future revenues, sale of strategic investments, and, to a lesser extent, revenue from FreeHold products. On January 9, 2026, Haemonetics closed on an acquisition of Vivasure in which we can receive up to $10.7 million of proceeds in 2026 made up of approximately $4.7 million received upfront and approximately $6.0 million in a first milestone payment expected later this year. As of March 31, 2026, we have raised a cumulative $367.2 million in gross proceeds. We had $94.4 million in cash and cash equivalents and marketable securities at March 31, 2026, comprised of $28.4 million in cash and cash equivalents and $66.0 million in marketable securities. Cash and cash equivalents consisted primarily of bank deposits and money market funds while short-term marketable securities consisted primarily of our investments in corporate debt securities. On May 1, 2026, we received $20.0 million pursuant to the Medtronic Loan Agreement and an additional $15.0 million from Ligand pursuant to the Royalty Purchase Agreement.

Current wording

From inception through June 30, 2026, we have incurred significant operating losses and negative cash flows from our operations. Our net losses were $44.4 million and $38.1 million for the six months ended June 30, 2026 and 2025, respectively. As of June 30, 2026, we had an accumulated deficit of $407.0 million. We have funded our operations primarily through the issuance of our common stock, convertible preferred stock, and warrants, as well as proceeds from the Business Combination, the prior Terumo Agreement and the Termination and ROFR Agreement, borrowings under debt arrangements, the sale of future revenues, the sale of strategic investments, and, to a lesser extent, revenue from FreeHold products. On January 9, 2026, Haemonetics closed on an acquisition of Vivasure pursuant to which we are eligible to receive up to $10.7 million of proceeds in 2026 made up of approximately $4.8 million already received and approximately $5.9 million in a first milestone payment expected later this year. We had $110.0 million in cash and cash equivalents and marketable securities at June 30, 2026, comprised of $20.5 million in cash and cash equivalents and $89.5 million in marketable securities. Cash and cash equivalents consisted primarily of bank deposits and money market funds while short-term marketable securities consisted primarily of our investments in corporate and government debt securities.

Previous wording

We intend to prioritize spending on our two flagship product candidates and expect operating expenses to increase accordingly as we focus on continued execution of the BACKBEAT Trial for AVIM Therapy and ramp up execution of the initiated Virtue Trial for Virtue SAB. The additional investment will primarily support clinical study costs as well as other research and development activities.

Current wording

We intend to prioritize spending on our two flagship product candidates and expect operating expenses to increase accordingly as we focus on continued execution of the BACKBEAT Trial for AVIM Therapy and Virtue Trial for Virtue SAB. Expenses will primarily support clinical study costs as well as other research and development activities.

Previous wording

Based on internally prepared budget estimates that reflect our operating priorities, we anticipate that our cash and cash equivalents, marketable securities, proceeds received subsequent to March 31, 2026 but prior to the filing of this Quarterly Report on Form 10-Q, are sufficient to fund our operations into the fourth quarter of 2027. The amount and timing of our future funding requirements may change from this current estimate and are dependent on many factors, including the cost and pace of execution of clinical studies and research and development activities, the strength of results from clinical studies and other research, development and manufacturing efforts. There are no assurances that any of these factors will be favorable to us, and we may need to seek additional sources of liquidity to meet our funding requirements earlier than current estimates, including the issuance of new equity, and/or other financing structures. In this regard, as of the date of this Quarterly Report on Form 10-Q, we may sell up to $92.4 million of shares of our common stock under the sales agreement (the “Sales Agreement”) we entered into with TD Securities (USA) LLC (“TD Cowen”) pursuant to which we may offer and sell, from time to time through TD Cowen, shares of our common stock by any method permitted by law and deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act.

Current wording

Based on internally prepared budget estimates that reflect our operating priorities, we anticipate that our cash and cash equivalents, and marketable securities are sufficient to fund our operations into the fourth quarter of 2027. The amount and timing of our future funding requirements may change from this current estimate and are dependent on many factors, including the cost and pace of execution of clinical studies and research and development activities, the strength of results from clinical studies and other research, development and manufacturing efforts. There are no assurances that any of these factors will be favorable to us, and we may need to seek additional sources of liquidity to meet our funding requirements earlier than current estimates, including the issuance of new equity, and/or other financing structures. In this regard, as of the date of this Quarterly Report on Form 10-Q, we may sell up to $92.4 million of shares of our common stock under the sales agreement (the “Sales Agreement”) we entered into with TD Securities (USA) LLC (“TD Cowen”) pursuant to which we may offer and sell, from time to time through TD Cowen, shares of our common stock by any method permitted by law and deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act.

Previous wording

Net cash used in operating activities for the three months ended March 31, 2026 was $22.2 million and primarily consisted of our net loss of $20.7 million and changes in net operating assets and liabilities of $3.7 million, partially offset by non-cash charges of $2.2 million. Our non-cash charges primarily consisted of stock-based compensation of $2.9 million and non-cash interest expense on liability related to the Royalty Purchase Agreement of $1.3 million, partially offset by the gain on the sale of strategic investments of $2.2 million. The net change in operating assets and liabilities was primarily due to an increase in accounts payable, accrued expenses and other liabilities of $3.1 million and prepaid expenses and other assets of $477,000.

Current wording

Net cash used in operating activities for the six months ended June 30, 2026 was $41.5 million and primarily consisted of our net loss of $44.4 million and changes in net operating assets and liabilities of $3.6 million, partially offset by non-cash charges of $6.5 million. Our non-cash charges primarily consisted of stock-based compensation of $5.4 million, non-cash interest expense on liability related to the Royalty Purchase Agreement of $3.1 million and accrued interest expense on liability related to the note payable of $442,000, partially offset by the gain on the sale of strategic investments of $2.3 million. The net change in operating assets and liabilities was primarily due to a decrease in accounts payable, accrued expenses and other liabilities of $3.3 million and operating lease liabilities of $359,000.

Previous wording

Net cash used in operating activities for the three months ended March 31, 2025 was $16.6 million and primarily consisted of our net loss of $18.8 million and changes in net operating assets and liabilities of $1.0 million, partially offset by non-cash charges of $3.1 million. Our non-cash charges primarily consisted of stock-based compensation of $3.0 million, partially offset by $112,000 related to accretion and interest of marketable securities. The net change in operating assets and liabilities was primarily due to a decrease in deferred revenue of $732,000, a decrease in accounts payable, accrued expenses and other liabilities of $202,000, and a decrease in operating lease liabilities of $132,000.

Current wording

Net cash used in operating activities for the six months ended June 30, 2025 was $32.1 million and primarily consisted of our net loss of $38.1 million and changes in net operating assets and liabilities of $632,000, partially offset by non-cash charges of $6.6 million. Our non-cash charges primarily consisted of stock-based compensation of $6.2 million, partially offset by $161,000 related to accretion and interest of marketable securities. The net change in operating assets and liabilities was primarily due to a decrease in deferred revenue of $1.4 million offset by a decrease in accounts payable, accrued expenses and other liabilities of $888,000.

Previous wording

Net cash provided by investing activities for the three months ended March 31, 2026 was $10.3 million, which primarily consisted of the sale of $18.9 million of marketable securities and the sale of strategic investments of $4.7 million partially offset by the purchase of $13.1 million of marketable securities.

Current wording

Net cash used in investing activities for the six months ended June 30, 2026 was $13.0 million, which primarily consisted of the purchase of $56.1 million of marketable securities partially offset by the sale of $38.8 million of marketable securities and the sale of strategic investments of $4.8 million.

Previous wording

Net cash provided by investing activities for the three months ended March 31, 2025 was $13.0 million, which primarily consisted of the sale of $16.0 million of marketable securities, partially offset by the purchase of $2.9 million of marketable securities.

Current wording

Net cash provided by investing activities for the six months ended June 30, 2025 was $29.4 million, which primarily consisted of the sale of $32.4 million of marketable securities, partially offset by the purchase of $2.9 million of marketable securities.

Previous wording

Net cash provided by financing activities for the three months ended March 31, 2026 was $5.5 million, which primarily consisted of $5.9 million of proceeds from proceeds from the sale of our common stock pursuant to the Sales Agreement, partially offset by $354,000 used to settle taxes associated with restricted stock vesting.

Current wording

Net cash provided by financing activities for the six months ended June 30, 2026 was $40.3 million, which primarily consisted of $20.0 million of proceeds from the Medtronic Term Loan, $15.0 million of proceeds from the royalty purchase agreement and $5.9 million of proceeds from the sale of our common stock pursuant to the Sales Agreement, partially offset by $616,000 used to settle taxes associated with restricted stock vesting.

Previous wording

Net cash provided by financing activities of $296,000 for the three months ended March 31, 2025 was primarily due to $387,000 used to settle taxes associated with restricted stock vesting, partially offset by proceeds of $91,000 related to the exercise of stock options.

Current wording

Net cash used by financing activities of $724,000 for the six months ended June 30, 2025 was primarily due to $815,000 used to settle taxes associated with restricted stock vesting, partially offset by proceeds of $91,000 related to the exercise of stock options.

Previous wording

Our financial statements are prepared in accordance with U.S. GAAP. The preparation of the financial statements in conformity with U.S. GAAP requires our management to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. We evaluate our significant estimates on an ongoing basis, including estimates related to the total costs expected to be incurred though the completion of the combined performance obligation of the Terumo Agreement (prior to its termination in October 2025, effective interest expense related to the Royalty Purchase Agreement, research and development prepayments, accruals and related expenses and stock-based compensation. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates.

Current wording

Our financial statements are prepared in accordance with U.S. GAAP. The preparation of the financial statements in conformity with U.S. GAAP requires our management to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. We evaluate our significant estimates on an ongoing basis, including estimates related to the total costs expected to be incurred though the completion of the combined performance obligation of the Terumo Agreement (prior to its termination in October 2025), changes in the fair value of the derivative liability, effective interest expense related to the Royalty Purchase Agreement, research and development prepayments, accruals and related expenses and stock-based compensation. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates.

Previous wording

Our critical accounting policies are described in the MD&A section of our Form 10-K for the year ended December 31, 2025 filed with the SEC on March 12, 2026. There have been no material changes to our critical accounting policies during the three months ended March 31, 2026*.*

Current wording

Our critical accounting policies are described in the MD&A section of our Form 10-K for the year ended December 31, 2025 filed with the SEC on March 12, 2026. There have been no material changes to our critical accounting policies during the six months ended June 30, 2026*.*