Fulcrum Therapeutics, Inc.

1. Nature of the Business and Basis of Presentation

Fulcrum Therapeutics, Inc. (the “Company”) was incorporated in Delaware on August 18, 2015. The Company has historically focused on developing small molecules to improve the lives of patients with genetically-defined rare diseases in areas of high unmet medical need.

On June 1, 2026, the Company announced the discontinuation of its pociredir program for the treatment of sickle cell disease (“SCD”), following receipt of meeting minutes from recent end-of-phase interactions with the U.S. Food and Drug Administration (the “FDA”). The minutes reflected heightened FDA concerns regarding pociredir’s benefit-risk profile in SCD. FDA’s position left no viable regulatory path forward for further clinical development of pociredir. On May 31, 2026, the Company’s board of directors approved a restructuring plan to significantly reduce the Company’s operating expenses and preserve capital, reducing the Company’s workforce by approximately 85%, from 57 tonine full-time employees. In connection with the restructuring, the Company has ceased its research and development activities. The Company has also initiated a comprehensive review of strategic alternatives intended to maximize stockholder value, including, but not limited to, a merger, acquisition, business combination, sale or licensing of assets, or other strategic transaction involving the Company or its assets, and has engaged Leerink Partners LLC as its financial advisor. See Note 16, “Restructuring Activities.”

The Company is subject to a number of risks and uncertainties, including, but not limited to, the outcome of its review of strategic alternatives, its ability to preserve capital, dependence on key personnel following the workforce reduction, its ability to satisfy its remaining obligations, and the need to comply with government regulations and public-company reporting requirements.

Basis of Presentation

The accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”).

The accompanying consolidated financial statements and footnotes to the financial statements have been prepared on the same basis as the most recently audited annual consolidated financial statements and, in the opinion of management, reflect all normal recurring adjustments necessary for the fair presentation of the Company’s financial position as of June 30, 2026 and the results of its operations and its cash flows for the three and six months ended June 30, 2026 and 2025. The results for the three and six months ended June 30, 2026 are not necessarily indicative of results to be expected for the year ending December 31, 2026, any other interim periods, or any future year or period. These consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 24, 2026 (the “Annual Report on Form 10-K”).

Liquidity

The Company has incurred recurring losses and negative cash flows from operations since inception and has primarily funded its operations with proceeds from the sale of shares of its capital stock and from upfront payments received from collaboration and license agreements. As of June 30, 2026, the Company had an accumulated deficit of$639.3 million. Following the discontinuation of the pociredir program and the restructuring, the Company expects its operating expenses and negative operating cash flows to decrease substantially in future periods, offset in the near term by cash outflows for restructuring, potential costs to exit its leased facility, and professional and advisory fees incurred in connection with its evaluation of strategic alternatives.

The Company expects that its cash, cash equivalents, and marketable securities will be sufficient to fund its operating expenses and capital expenditure requirements for at least 12 months from the date of issuance of these financial statements. However, the Company has based this estimate on assumptions that may prove to be wrong, and its operating plan may change as a result of many factors currently unknown to it.

2. Summary of Significant Accounting Policies

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Fulcrum Therapeutics Securities Corp., which is a Massachusetts subsidiary created to buy, sell, and hold securities. All intercompany transactions and balances have been eliminated.

Summary of Significant Accounting Policies

The significant accounting policies and estimates used in the preparation of the accompanying consolidated financial statements are described in the Company’s audited consolidated financial statements for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K. There have been no material changes in the Company’s significant accounting policies during the six months ended June 30, 2026, other than as described below.

Use of Estimates

The preparation of financial statements in accordance with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amount of expenses during the reported periods. Estimates inherent in the preparation of these consolidated financial statements include, but are not limited to, estimates related to accrued expenses, the fair value of long-lived assets (including the fair value of the operating lease right-of-use asset) in connection with impairment assessments, restructuring accruals, stock-based compensation expense, and income taxes. The Company bases its estimates on historical experience and other market specific or other relevant assumptions it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts and experience. Actual results could differ from those estimates or assumptions.

Long-Lived Assets and Impairment

Long-lived assets consist of property and equipment and operating lease right-of-use assets. The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (or asset group) may not be recoverable. The Company groups long-lived assets with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Recoverability is measured by comparing the carrying amount of an asset group to the estimated undiscounted future cash flows expected to result from its use and eventual disposition. If the carrying amount is not recoverable, an impairment loss is recognized equal to the amount by which the carrying amount exceeds fair value, with fair value estimated using the income, market or cost approach as appropriate. During the three months ended June 30, 2026, the cessation of research and development activities and the decision to dispose of assets used in those activities were identified as indicators of impairment. See Note 3, “Fair Value Measurements,” and Note 5, “Property and Equipment, Net.”

Assets Held for Sale

The Company classifies long-lived assets as held for sale when the applicable criteria in ASC 360-10-45 are met, including that the sale is probable and expected to be completed within one year. Assets held for sale are measured at the lower of carrying amount or fair value less costs to sell and are no longer depreciated. Amounts received from a buyer prior to the transfer of control are recorded as a deposit (contract liability) until the criteria for recognizing the sale are met.

Off-Balance Sheet Risk and Concentrations of Credit Risk

The Company has no significant off-balance sheet risk such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash, cash equivalents, marketable securities, and restricted cash. The Company’s cash, cash equivalents, and restricted cash are deposited in accounts at large financial institutions. The Company believes it is not exposed to significant credit risk due to the financial strength of the depository institutions in which the cash, cash equivalents and restricted cash are held. The Company maintains its cash equivalents in U.S. Treasury securities and money market funds that invest in U.S. Treasury securities. The Company’s marketable securities consist of U.S. Treasury securities and corporate bonds, and potentially subject the Company to concentrationsof credit risk. The Company has adopted an investment policy that limits the amounts the Company may invest in any one type of investment. The Company has not experienced any credit losses and does not believe it is exposed to any significant credit risk on these funds.

Recent Accounting Pronouncements

In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, which requires disclosure of additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. The standard is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the disclosure requirements related to this new standard.

3. Fair Value Measurements

The following tables present information about the Company’s financial assets measured at fair value on a recurring basis and indicate the fair value hierarchy classification of such fair values as of June 30, 2026 and December 31, 2025 (in thousands):

There wereno transfers between fair value levels during thethree and six months ended June 30, 2026.

Assets Measured at Fair Value on a Nonrecurring Basis

During the three months ended June 30, 2026, the Company measured certain long-lived assets at fair value on a nonrecurring basis in connection with impairment charges recorded as a result of the discontinuation of the pociredir program and the related restructuring. The Company’s operating lease right-of-use asset was written down to its estimated fair value of zero, determined using an income approach based on the present value of estimated net sublease cash flows over the remaining lease term (a Level 3 measurement using significant unobservable inputs, including estimated sublease rates, expected downtime, free rent and other concessions, and a discount rate). The related leasehold improvements were written down to an estimated fair value of zero. Laboratory equipment classified as held for sale was measured at fair value less costs to sell, based on the $0.9 million contracted sale price under an executed asset purchase agreement (a Level 2 measurement based on the observable transaction price). See Note 5, “Property and Equipment, Net,” and Note 16, “Restructuring Activities.”

4. Cash Equivalents and Marketable Securities

Cash equivalents and marketable securities consisted of the following as of June 30, 2026 and December 31, 2025 (in thousands):

There wereno sales of marketable securities during thethree and six months ended June 30, 2026. As of June 30, 2026, the Company held 36 debt securities that were in an unrealized loss position for less than 12 months with an aggregate fair value of $208.8 million. As of June 30, 2026, the Company held 3 debt securities that were in an unrealized loss position for greater than 12 months with a fair value of $12.0 million. As of June 30, 2026, the aggregate fair value of marketable securities with a remaining contractual maturity of greater than one year was $14.9 million.

The Company has the intent and ability to hold its debt securities until recovery. The Company didnot record any charges for credit-related impairments for its marketable securities for the three and six months ended June 30, 2026.

5. Property and Equipment, Net

Property and equipment, net consisted of the following (in thousands):

Depreciation expense for the three months ended June 30, 2026 and 2025 was $0.2 million and $0.3 million, respectively. Depreciation expense for thesix months ended June 30, 2026 and 2025 was $0.6 million and $0.7 million, respectively.

In connection with the discontinuation of the pociredir program and the related restructuring, during the three months ended June 30, 2026 the Company ceased use of its laboratory and recognized impairment and disposal charges related to its long-lived assets. The Company recorded an impairment charge of $1.3 million to write off its leasehold improvements in full. In June 2026, the Company entered into an asset purchase agreement to sell substantially all of its laboratory equipment for a purchase price of $0.9 million, of which $0.5 million was received as a deposit as of June 30, 2026. The laboratory equipment was reclassified to assets held for sale (included in prepaid expenses and other current assets) at its fair value less costs to sell, resulting in an additional impairment charge of $0.1 million, and the related deposit is recorded within accrued expenses and other current liabilities. The impairment charges are included in impairment of long-lived assets in the consolidated statements of operations. See Note 3, “Fair Value Measurements.”

6. Additional Balance Sheet Detail

Prepaid expenses and other current assets consisted of the following (in thousands):

Accrued expenses and other current liabilities consisted of the following (in thousands):

7. Preferred Stock

As of June 30, 2026 and December 31, 2025,5,000,000 shares of undesignated preferred stock were authorized. No shares of preferred stock were issued or outstanding as of June 30, 2026 and December 31, 2025.

No dividends have been declared since inception.

8. Common Stock

As of June 30, 2026 and December 31, 2025,200,000,000 shares of common stock, $0.001 par value per share, were authorized.

Each share of common stock entitles the holder toone vote on all matters submitted to a vote of the Company’s stockholders. Common stockholders are not entitled to receive dividends, unless declared by the Company’s board of directors, subject to the preferential dividend rights of any preferred stock then outstanding. No dividends have been declared or paid by the Company since its inception.

As of June 30, 2026 and December 31, 2025, the Company has reserved for future issuance the following number of shares of common stock:

Pre-Funded Warrants

In August 2024, the Company entered into separate exchange agreements with RA Capital Healthcare Fund, L.P. (“RA Capital”) and another existing institutional stockholder, pursuant to which (i) RA Capital exchanged 8,500,000 shares of the Company's common stock for a pre-funded warrant to acquire 8,500,000 shares of the Company's common stock and (ii) the other existing institutional stockholder exchanged an aggregate of 850,000 shares of the Company's common stock, for pre-funded warrants to acquire an aggregate of 850,000 shares of the Company's common stock. The aggregate 9,350,000 shares of common stock subject to the exchange agreements were retired on the date of the exchanges. In December 2025, the Company issued and sold 1,111,193 pre-funded warrants to purchase shares of common stock, at a price to the public of $13.499 per pre-funded warrant. During the three months ended June 30, 2026, all outstanding pre-funded warrants were exercised. As of June 30, 2026, no pre-funded warrants remained outstanding.

9. Stock-based Compensation Expense

2016 Stock Incentive Plan

In July 2016, the Company adopted the 2016 Stock Incentive Plan (the “2016 Plan”), which provided for the grant of restricted stock awards, restricted stock units, incentive stock options, non-statutory stock options, and other stock-based awards to the Company’s eligible employees, officers, directors, consultants, and advisors. As of the effective date of the 2019 Stock Incentive Plan (the “2019 Plan”), and as of June 30, 2026, no shares remained available for future issuance under the 2016 Plan. Any options or other awards outstanding under the 2016 Plan remain outstanding and effective.

2019 Stock Incentive Plan

On July 2, 2019, the Company’s stockholders approved the 2019 Plan, which became effective on July 17, 2019. The 2019 Plan provides for the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock units and other stock-based awards to the Company’s officers, employees, directors, consultants and advisors. The number of shares initially reserved for issuance under the 2019 Plan was 2,017,142 shares, plus the shares of common stock remaining available for issuance under the 2016 Plan as of July 17, 2019. The number of shares reserved was increased on January 1, 2020 and will be increased each January 1 thereafter through January 1, 2029 by the least of (i)2,000,000 shares, (ii)4% of the number of shares of the Company’s common stock outstanding on the first day of each such year or (iii) an amount determined by the Company’s board of directors. On January 1, 2026, the number of shares reserved for issuance under the 2019 Plan was increased by 2,000,000 shares. As of June 30, 2026, there were 6,195,194 shares available for future issuance under the 2019 Plan.

The shares of common stock underlying any awards that expire, terminate, or are otherwise surrendered, cancelled, forfeited or repurchased by the Company under the 2016 Plan or the 2019 Plan will be added back to the shares of common stock available for issuance under the 2019 Plan. As of July 17, 2019, no further awards will be made under the 2016 Plan.

2022 Inducement Stock Incentive Plan

In February 2022, the Company’s board of directors adopted the 2022 Inducement Stock Incentive Plan (the “Inducement Plan”), pursuant to which the Company may grant, subject to the terms of the Inducement Plan and Nasdaq rules, nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock units, and other stock-based awards. The Company initially reserved a total of 1,750,000 sharesof common stock for the issuance of awards under the Inducement Plan. The number of shares reservedand available for issuance under the Inducement Plan can be increased at any time with the approval of the Company’s board of directors. The Inducement Plan permits the board of directors, a delegated committee of the board of directors, or a delegated officer of the Company to grant the stock-based awards available under the Inducement Plan to attract key employees for the growth of the Company. Effective March 8, 2023, the Company’s board of directors amended the Inducement Plan to increase the number of shares reserved for issuance by 2,000,000 shares. Effective May 18, 2023, the Company’s board of directors amended the Inducement Plan to increase the number of shares reserved for issuance by 1,400,000 shares. Effective June 17, 2024, the Company’s board of directors amended the Inducement Plan to increase the number of shares reserved for issuance by 1,000,000 shares. As of June 30, 2026, there were 1,877,867 shares available for future issuance under the Inducement Plan.

Stock Options

Stock options granted by the Company typically vest over afour-year period and have aten year contractual term. Shares issued upon the exercise of stock options are issued from the Company’s pool of authorized but unissued common stock. In addition to stock options granted under the 2019 Plan and 2016 Plan, the Company has granted stock options as material inducements to employment in accordance with Nasdaq Listing Rule 5635(c)(4), which were granted outside of the 2019 Plan and 2016 Plan. The following table summarizes the Company’s stock option activity during thesix months ended June 30, 2026:

The aggregate intrinsic value of stock options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock as of the balance sheet date for those options that had exercise prices lower than the fair value of the Company’s common stock.

The weighted average grant date fair value of stock options granted in the three and six months ended June 30, 2026 was $4.12 per share and $8.39 per share, respectively. The weighted average grant date fair value of stock options granted in thethree and six months ended June 30, 2025 was $5.11 per share and $3.83 per share, respectively. The total intrinsic value of stock options exercised during thethree and six months ended June 30, 2026 was $0.1 million and $0.2 million, respectively. The total intrinsic value of stock options exercised during thethree and six months ended June 30, 2025 was $0.2 million.

The fair value of stock options granted during thethree and six months ended June 30, 2026 and 2025 has been calculated on the date of grant using the following weighted average assumptions:

Restricted Stock Units

The Company has also granted restricted stock units. The shares of common stock underlying restricted stock units typically vest over a four-year period. The shares of common stock are recorded in stockholders’ equity as they vest.

The following table summarizes the Company’s restricted stock unit activity during thesix months ended June 30, 2026:

Stock-based Compensation Expense

The total compensation cost recognized in the statements of operations and comprehensive loss associated with all stock-based compensation awards granted by the Company is as follows (in thousands):

As of June 30, 2026, the Company had an aggregate of $22.3 million of unrecognized stock-based compensation expense, which is expected to be recognized over a weighted average period of 2.33 years.

2019 Employee Stock Purchase Plan

On July 2, 2019, the Company’s stockholders approved the 2019 Employee Stock Purchase Plan (the “ESPP”), which became effective on July 17, 2019. A total of 252,142 shares of common stock were initially reserved for issuance under the ESPP. In addition, the number of shares of common stock reserved under the ESPP was increased on January 1, 2020, and will be increased annually on each January 1 thereafter through January 1, 2029, by the least of (i)428,571 shares of common stock, (ii)1% of the number of shares of the Company’s common stock outstanding on the first day of each such year or (iii) an amount determined by the Company’s board of directors. On January 1, 2026, the number of shares reserved for issuance under the 2019 ESPP was increased by 428,571 shares. As of June 30, 2026, there were 2,441,771 shares available for future issuance under the ESPP.

10. License and Collaboration Agreements

Sanofi Agreement

In May 2024, the Company entered into a collaboration and license agreement (the “Sanofi Agreement”) with Genzyme Corporation (“Sanofi”), pursuant to which the Company granted Sanofi an exclusive license to commercialize losmapimod, an oral small molecule for the treatment of facioscapulohumeral muscular dystrophy, outside of the United States.

In September 2024, the Company discontinued development of losmapimod following topline results from the Phase 3 REACH trial. On December 18, 2024, Sanofi provided written notice of termination for convenience, and the agreement terminated in its entirety on April 17, 2025. As a result, the Company is not entitled to receive any further milestone payments, royalties, or development cost reimbursements under the agreement.

During the three and six months ended June 30, 2026, the Company recordedno activity related to the Sanofi Agreement. During the three and six months ended June 30, 2025, the Company recordeda reduction in research and development expenses of less than $0.1 million and $1.0 million, respectively, related to reimbursable global development activities under the agreement.

CAMP4 Agreement

In July 2023, the Company entered into a license agreement (the “CAMP4 Agreement”) with CAMP4 Therapeutics Corporation (“CAMP4”), pursuant to which the Company obtained a worldwide exclusive license to certain intellectual property related to CAMP4’s Diamond-Blackfan anemia (“DBA”) program. Under the terms of the agreement, the Company was responsible for development and commercialization of any licensed products, and CAMP4 would have been eligible to receive development, regulatory, and sales milestone payments, as well as royalties on net sales of licensed products.

In April 2025, the Company incurred a $0.6 million preclinical milestone payment, which was recorded as research and development expense during the year ended December 31, 2025.

In February 2026, the Company announced the discontinuation of its bone marrow failure syndromes program, including DBA. On April 23, 2026, the Company delivered written notice to terminate the CAMP4 Agreement for convenience. In accordance with the terms of the agreement, the termination will become effective following the applicable notice period. Upon termination, the Company will have no further obligations under the agreement, other than those that survive termination in accordance with its terms.

11. Leases

Operating Leases

26 Landsdowne Street

In November 2017, the Company entered into a lease agreement for its current corporate headquarters comprising approximately 28,731 square feet of office and laboratory space at 26 Landsdowne Street in Cambridge, Massachusetts, commencing December 2017. The Company began to occupy and use the leased space for its intended purpose in June 2018. The lease ends on June 30, 2028. The Company has the option to extend the term of the lease for an additional five-year period, at the market rate, by giving the landlord written notice of its election to exercise the extension at least nine months prior to the original expiration of the lease term. The lease has a total commitment of $25.1 million over theten year term, and includes escalating rent payments. The lease provides the Company with an allowance for normal leasehold improvements of $5.0 million. The lease agreement requires the Company to either pay a security deposit or maintain a letter of credit of $1.1 million. The Company maintains a letter of credit for this lease and has recorded the cash held to secure the letter of credit as restricted cash on the consolidated balance sheet as of June 30, 2026 and December 31, 2025. Operating lease expense associated with this lease for the three and six months ended June 30, 2026 was approximately $0.3 million and $0.8 million, respectively. Variable lease expense associated with this lease for thethree and six months ended June 30, 2026 was approximately $0.3 million and $0.5 million, respectively.

During the three months ended June 30, 2026, in connection with the cessation of the Company’s research and development activities, the Company recognized an impairment charge of $3.6 million to write down the operating lease right-of-use asset associated with its 26 Landsdowne Street facility to its estimated fair value. See Note 3, “Fair Value Measurements,” and Note 5, “Property and Equipment, Net.” The Company is marketing the facility for sublease and is exploring an early termination of the lease with its landlord. As of June 30, 2026, the Company had not entered into a sublease or an agreement to terminate the lease.

The future minimum lease payments associated with the 26 Landsdowne Street lease as of June 30, 2026, are as follows (in thousands):

(1)Amounts are for six months ending December 31, 2026.

12. Commitments and Contingencies

Indemnification Agreements

In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters arising out of the relationship between such parties and the Company. In addition, the Company has entered into indemnification agreements with members of its board of directors and senior management that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. To date, the Company has not incurred any material costs as a result of such indemnifications. The Company is not aware of any claims under indemnification arrangements, and it hasnot accrued any liabilities related to such obligations as of June 30, 2026 or December 31, 2025.

Legal Proceedings

The Company is not currently a party to any material legal proceedings. At each reporting date, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. The Company expenses the costs related to its legal proceedings as they are incurred. No such costs have been incurred during the three and six months ended June 30, 2026.

13. Defined Contribution Plan

The Company has a defined contribution savings plan under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”). The 401(k) Plan covers all employees who meet defined minimum age and service requirements, and allows participants the option to elect to defer a portion of their annual compensation on a pretax basis. As currently established, the Company is not required to make contributions to the 401(k) Plan. The Company made $0.1 million and $0.3 million, respectively, in contributions to the 401(k) Plan for thethree and six months ended June 30, 2026. The Company made $0.1 million and $0.2 million, respectively, in contributions to the 401(k) Plan for thethree and six months ended June 30, 2025.

14. Net (Loss) Income per Share

Basic net (loss) income per share is calculated by dividing net (loss) income by the weighted average number of common shares outstanding during the period. During the three months ended June 30, 2026, all outstanding pre-funded warrants were exercised for shares of common stock, as described in Note 8. The shares of common stock issued upon exercise are included in the weighted average number of common shares outstanding from their respective dates of issuance. For the three and six months ended June 30, 2025, the weighted average number of common shares outstanding included shares of common stock issuable upon the exercise of pre-funded warrants that were exercisable for little or no consideration.

The following common stock equivalents were excluded from the calculation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect:

15. Segment Information

Segment reporting is prepared on the same basis that the Company'schief executive officer, who is the Company's chief operating decision maker (the “CODM”), utilizes to manage the business and makes decisions on how to allocate resources and assess performance of the business. The Company and the CODM view the Company's operations as asingle operating segment. The Company's singular focus is on developing small molecules to improve the lives of patients with genetically defined rare diseases in areas of high unmet medical need.

The Company and the CODM primarily utilize the segment's consolidated net loss, disaggregated between (a) research and development and (b) general and administrative, as the key indicator to assess the segment's performance and for allocating resources.

The Company's reportable segment operating expenses and net loss for thethree and six months ended June 30, 2026 and 2025 are as follows (in thousands):

16. Restructuring Expenses

On May 31, 2026, the Company’s board of directors approved a restructuring plan to significantly reduce the Company’s operating expenses and preserve capital following the discontinuation of pociredir. The restructuring plan reduced the Company’s workforce by approximately 85%, from 57 tonine full-time employees, and was substantially completed during the second quarter of 2026. The Company communicated the workforce reduction on June 4, 2026.

During the three and six months ended June 30, 2026, the Company recorded aggregate restructuring charges of $4.3 million, consisting primarily of employee severance, benefits and related costs, of which $2.1 million was paid during the period. Restructuring charges are presented as a separate component of operating expenses. The Company recognizes one-time employee termination benefits in accordance with ASC 420; for employees required to render service beyond the minimum retention period, the related cost is recognized ratably over the future service period, and the Company therefore expects to recognize additional restructuring charges during the third quarter of 2026. The charges described above do not include the impairment of long-lived assets recorded in connection with the restructuring, which is described in Note 5, “Property and Equipment, Net.”

The following table summarizes the Company’s restructuring activity (in thousands):

In June 2026, the Compensation Committee approved cash retention arrangements for the Company’s nine remaining full-time employees, with aggregate potential payments of approximately $1.4 million. Payment of the retention amounts is contingent upon the occurrence of specified strategic-transaction and/or qualifying termination events and, where applicable, the completion of transitional duties. The Compensation Committee also approved certain additional severance protections for the remaining employees, including enhanced change-in-control benefits for employees at the Vice President level and above in the event of a qualifying termination within the six months preceding a change in control. No expense or liability was recognized for these arrangements as of June 30, 2026 because the applicable triggering events were not considered probable. The Company will recognize compensation expense when the applicable recognition criteria are met.