MBX Biosciences, Inc.

NATURE OF BUSINESS AND Liquidity

MBX Biosciences, Inc. (“MBX” or the “Company”) is a clinical-stage biopharmaceutical company focused on the discovery and development of novel precision peptide therapies for the treatment of endocrine and metabolic disorders. The Company is advancing a pipeline of novel candidates for endocrine and metabolic disorders. The Company was organized in August 2018 in Indiana as a Limited Liability Company and converted to a C corporation in the state of Delaware in April 2019. The Company maintains its corporate offices in Carmel, Indiana, as well as lab and supplemental office space in Burlington, Massachusetts.

Since inception, the Company has devoted substantially all of its resources to drug discovery and development of its product candidates canvuparatide (MBX 2109), imapextide (MBX 1416), MBX 4291, and other preclinical programs, building an intellectual property portfolio, organizing and staffing the Company, business planning, raising capital and providing general and administrative support for these operations. The Company does not have any products approved for sale and has not generated any revenue from product sales. The Company has historically funded its operations primarily through the issuance and sale of our common stock, including through our initial public offering (the "IPO"), convertible preferred stock and convertible notes, which generated approximately $401.8 million in aggregate gross proceeds. In September 2025, the Company also completed an underwritten public offering (the "September 2025 Offering") of 11,108,055 shares of its common stock, which generated approximately $199.9 million in aggregate gross proceeds. In February 2026, the Company sold 2,250,986 shares of its common stock under its Open Market Sale Agreement SM with Jefferies, LLC (the "February 2026 ATM Offering"), which generated approximately $87.1 million in aggregate gross proceeds, resulting in $688.8 million in cumulative, aggregate gross proceeds from those sales of common stock. In March 2026, the Company filed an automatic shelf registration statement with the Securities and Exchange Commission (File No. 333-294237) and increased the amount available under the Open Market Sale Agreement SM with Jefferies, LLC (the "March 2026 Sales Agreement"), under which the Company may now, from time to time in one or more offerings, sell and issue shares ofits common stock having an aggregate price of up to $250.0 million.

Liquidity

From inception and through June 30, 2026, the Company has devoted substantially all of its efforts to drug discovery and development. The Company has a limited operating history, has incurred operating losses since inception and expects to continue to incur significant operating losses for the foreseeable future. The Company incurred net losses of $60.6 million and $87.0 million for thesix months ended June 30, 2026 and the year ended December 31, 2025, respectively. As of June 30, 2026, the Company has an accumulated deficit of $285.1 million and cash, cash equivalents and marketable securities of$418.6 million. Based on the Company’s current operating plan, management believes that existing cash and cash equivalents and marketable securities will be sufficient to fund the Company’s obligations for at least 12 months from the date of issuance of these condensed financial statements.

Basis of presentation

The accompanying unaudited condensed financial statements as of June 30, 2026 and for the three and six months ended June 30, 2026 and 2025 have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and pursuant to Article 10 of Regulation S-X of the Securities Act of 1933, as amended. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. These unaudited condensed financial statements include only normal and recurring adjustments that the Company believes are necessary to fairly state the Company’s financial position and the results of its operations and cash flows. The results for the three and six months ended June 30, 2026 are not necessarily indicative of the results expected for the full fiscal year or any subsequent interim period. The condensed balance sheet at December 31, 2025 has been derived from the audited financial statements at that date but does not include all disclosures required by U.S. GAAP for complete financial statements. Because all of the disclosures required by U.S. GAAP for complete financial statements are not included herein, these unaudited condensed financial statements and the notes accompanying them should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2025 included in the Company's Annual Report on Form 10-K as filed with the SEC on March 12, 2026 ("2025 Annual Report").

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

There have been no significant changes from the significant accounting policies and estimates disclosed in Note 2 of the "Notes to Financial Statements" in the audited financial statements for the year ended December 31, 2025 and notes thereto, included in the 2025 Annual Report, except as noted below.

Cash, Cash Equivalents and Restricted Cash

The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents. As of June 30, 2026 and December 31, 2025, cash and cash equivalents consisted primarily of checking and savings deposits, money market fund holdings, and commercial paper. The Company maintains certain cash balances that are legally or contractually restricted as to withdrawal or use. These balances are classified as restricted cash and are included in prepaid expenses and other current assets or other assets in the accompanying balance sheets, depending on the nature and timing of the restrictions. The Company's restricted cash relates to amounts held under a letter of credit in connection with a lease agreement. As of June 30, 2026, $0.2 million of restricted cash is included inother assets in the accompanying June 30, 2026 balance sheet. The Company didnot have any restricted cash balances at December 31, 2025.

For purposes of the condensed statements of cash flows, cash, cash equivalents and restricted cash are included in the beginning of period and end of period total cash, cash equivalents and restricted cash balances.

Deferred offering costs

The Company capitalizes as deferred offering costs all direct and incremental legal, professional, accounting and other third-party fees incurred in connection with the March 2026 Sales Agreement, the February 2026 ATM Offering and the September 2025 Offering. The deferred offering costs related to the February 2026 ATM Offering and the September 2025 Offering were each offset against the February 2026 ATM Offering proceeds and the September 2025 Offering proceeds, respectively, upon the consummation of the applicable offerings. As of June 30, 2026, $0.4 million of deferred offering costs are included in other assets in the accompanying June 30, 2026 balance sheet, of which less than $0.1 million are included in accounts payable and accrued expenses. As of December 31, 2025, the Company had $0.3 million of deferred offering costs included in other assets, of which $0.1 million were included in accounts payable and accrued expenses, in the accompanying balance sheets.

Recently issued accounting pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard-setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the accompanying financial statements and disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which is intended to provide more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation and amortization) included in certain expense captions presented on the face of our income statements. This new standard is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments may be applied either (1) prospectively to financial statements issued for periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements. The Company is currently assessing the impact ASU 2024-03 will have on its financial statements, including the footnote disclosures.

FAIR VALUE Measurements

The following table presents information about the Company’s financial instruments as of June 30, 2026 and December 31, 2025, that are measured at fair value on a recurring basis and indicates the fair value hierarchy of the inputs the Company utilized to determine such fair value (in thousands):

Marketable Securities

The fair value of the Company’s marketable securities as of June 30, 2026 and December 31, 2025 is based on Level 1 and Level 2 inputs. The Company’s investments consist mainly of U.S. government and agency securities. Fair value is determined by taking into consideration valuations obtained from third-party pricing services. The third-party pricing services utilize industry standard valuation models, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities; issuer credit spreads; benchmark securities; and other observable inputs. There were no transfers between levels within the fair value hierarchy during each of the six months ended June 30, 2026 and 2025. The Company has assessed U.S. government treasuries as Level 1 and all other marketable securities as Level 2 within the fair value hierarchy of ASC 820. The Company classifies its entire investment portfolio as available-for-sale as defined in ASC 320, Debt Securities, and views all investments as available for use in its current operations. The Company has therefore classified all securities as current, even if it does not necessarily intend to dispose of the securities in the following year. Securities are carried at fair value with the unrealized (losses) gains reported in other comprehensive (loss) income.

As of June 30, 2026 and December 31, 2025, none of the Company’s investments were determined to be other than temporarily impaired.

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

The fair values of available-for-sale debt securities as of June 30, 2026, by contractual maturity, are summarized as follows (in thousands):

PREPAID EXPENSES and Other Current assets

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

PROPERTY AND EQUIPMENT, NET

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

Depreciation expense was $0.1 million for each of thethree and six months ended June 30, 2026 and 2025, respectively.

ACCRUED Expenses

Accrued expenses consisted of the following (in thousands):

Other Assets

Other assets consisted of the following (in thousands):

Restricted cash consists of amounts under a letter of credit related toa lease agreement the Company entered into with 5 Burlington Woods, LLC to lease new office and laboratory space in Burlington, Massachusetts in February 2026. This amount has been included in the ending balance of cash, cash equivalents and restricted cash in the accompanying condensed statements of cash flows.

Commitments and contingencies

Leases

In April 2022, the Company entered into an operating lease agreement for a principal executive office in Carmel, Indiana (the “Carmel Lease”). The Carmel Lease commenced in October 2022 and had an initial term of 39 months, a termination date of December 31, 2025, and anoption toextend for 36 additional months at the Company’s discretion. The option to extend was not considered reasonably certain as of the lease inception. On May 9, 2025, the Company entered into the first amendment of the Carmel Lease (the "First Amendment"). Pursuant to the terms of the First Amendment, the leased premises were expanded, and the lease term was extended through December 31, 2028 with anoption toextend for 36 additional months at the Company’s discretion. The option to extend was not considered reasonably certain as of the date of the First Amendment.

The Company entered into a new lease for laboratory space in August 2024, commencing in December 2024, and terminating in December 2025. In October 2025, the Company entered into a new operating lease agreement for laboratory space in Indianapolis, Indiana, commencing in December 2025 and terminating in November 2026. All laboratory leases are short-term leases with no corresponding lease liability or right-of-use asset recorded, and lease payments are recognized as expense on a straight-line basis over the lease terms.

In February 2026, the Company entered into an operating lease agreement with 5 Burlington Woods, LLC to lease new office and laboratory space in Burlington, Massachusetts ("Burlington Lease"). The lease commenced effective April 14, 2026, with the rent commencing five months from the lease commencement date, which will be September 14, 2026 ("rent commencement date"). The lease term isfour years from the rent commencement date, with aone-time option toextend the lease term for a period ofthree years. The option to extend was not considered reasonably certain as of the lease inception. The aggregate base rent over thefour-year lease term is approximately $3.4 million.

The Company has no other operating or finance leases as of June 30, 2026 or December 31, 2025.

Pursuant to ASC 842, the Company evaluated the new terms of the First Amendment of the Carmel Lease and determined the First Amendment should be treated as a lease modification of the existing Carmel Lease. In accordance with the accounting guidance, the Company remeasured the lease liability as of May 9, 2025, the First Amendment commencement date, to reflect the changes in the lease payments and the change in the lease term. This resulted in an increase of $0.6 million to the Company's lease liability and a corresponding increase to its right-of-use asset as shown on its balance sheet as of December 31, 2025.

Pursuant to ASC 842, the Company evaluated the Burlington Lease Agreement andrecorded a $2.8 million lease liability and $2.4 million right-of-use asset on its balance sheet as of June 30, 2026.

The future minimum rent payments relating to the Carmel Lease and Burlington Lease under the terms and conditions existing as of June 30, 2026, are summarized as follows (in thousands):

The Company incurred $0.2 million and $0.1 million of rent expense for thethree months ended June 30, 2026 and 2025, respectively. The Company incurred $0.3 million and $0.1 million of rent expense for thesix months ended June 30, 2026 and 2025, respectively.

The following table summarizes the operating lease terms and discount rates for the Carmel Lease and the Burlington Lease as of June 30, 2026 and December 31, 2025:

Cash paid for amounts included in the measurement of the Company’s operating lease liability was less than $0.1 million for each of thethree and six months ended June 30, 2026 and 2025.

The following table sets forth the amount of right-of-use assets and lease liabilities included on the Company’s balance sheet as of June 30, 2026 and December 31, 2025 (in thousands):

License agreement

In January 2024, the Company entered into an amendment (the "Amendment") for the Exclusive License Agreement with Indiana University Research and Technology Corporation (“IURTC”) (the “License Agreement”), to license certain intellectual property arising under the Master Research Agreement with The Trustees of Indiana University (the "Research Agreement"). The Amendment specifies IURTC is entitled to the receipt of additional clinical and regulatory milestones, as defined in the Amendment, up to an aggregate of $9.0 million. Following the execution of the Amendment, future remaining clinical and regulatory milestone payments in the License Agreement and all amendments totaled up to $9.3 million. In the year ended December 31, 2025, the Company paid a $1.0 million milestone payment to IURTC related to the initiation of the Phase 1 clinical trial MBX 4291. In March 2026, the Company triggered a $0.1 million milestone payment to IURTC following the completion of the end of Phase 2 meeting with the FDA related to the Phase 2 clinical trial of canvuparatide, which was paid in April 2026. This constituted the total license fees paid during thethree and six months ended June 30, 2026. In consideration for the license, the Company paidno license fees to IURTC during thethree and six months ended June 30, 2025.

Legal proceedings

The Company is not currently a party to any material legal proceedings. At each reporting date, the Company evaluates whether 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 as incurred the costs related to its legal proceedings.

Convertible preferred stock

Prior to its IPO, the Company issued Series A Convertible Preferred Stock, Series B Convertible Preferred Stock and Series C Convertible Preferred Stock.

On August 30, 2024, the Company's board of directors and stockholders approved the fourth amended and restated certificate of incorporation, which was effective immediately prior to the closing of the Company's IPO on September 16, 2024, and which, among other things, authorized 10,000,000 undesignated shares of preferred stock, $0.0001 par value per share.

The Company hadno shares of convertible preferred stock outstanding at June 30, 2026 or December 31, 2025.

Common stock

On August 30, 2024, the Company’s stockholders approved the fourth amended and restated certificate of incorporation, which was filed upon the closing of the IPO on September 16, 2024 and which, among other things, increased the number of shares of common stock authorized for issuance to 500,000,000 shares of common stock, $0.0001 par value.

On September 16, 2024, the Company completed the IPO of its common stock and issued and sold 11,730,000 shares of its common stock at a price of $16.00 per share. As a result, the Company received $170.5 million in net proceeds, after deducting underwriting discounts and commissions and offering costs of $17.2 million.

On September 26, 2025, the Company completed the September 2025 Offering and issued and sold 11,108,055 shares of its common stock at a price of $18.00 per share. As a result, the Company received $187.4 million in net proceeds, after deducting underwriting discounts and commissions and offering costs of $12.5 million.

On February 4, 2026, the Company completed the February 2026 ATM Offering and issued and sold 2,250,986 shares of its common stock at a volume weighted average price of $38.76 per share. As a result, the Company received $85.0 million in net proceeds, after deducting underwriting discounts and commissions and offering costs of $2.1 million.

As of June 30, 2026 and December 31, 2025, there were 47,949,804 and 44,927,953 shares of common stock issued and outstanding, respectively. As of June 30, 2026, there wereno sharesof restricted stock related to the unvested portion of early exercised common stock options included in shares of common stock issued and outstanding. Shares of common stock issued and outstandingas of December 31, 2025 included 694 shares of restricted stock related to the unvested portion of early exercised common stock options. These were included in shares of common stock as they were considered to be legally outstanding as of December 31, 2025. These shares were subject to the Company’s option to repurchase and were not transferable until such time as they are fully vested.

Common stock reserved

The number of shares of common stock that have been reserved for future issuance in connection with outstanding stock options and restricted stock units ("RSUs") granted under the Company's 2019 Stock Option and Grant Plan (the "2019 Plan"), the 2024 Stock Option and Incentive Plan (the "2024 Plan"), the 2026 Inducement Plan (the "2026 Plan"), and shares reserved for issuance under the 2024 Plan and 2026 Plan and shares reserved for issuance under the 2024 ESPP as of June 30, 2026 and December 31, 2025, are as follows:

Stock-Based Compensation

2019 Stock Option and Grant Plan

The Company’s 2019 Plan, as amended, provides for the Company to sell or issue common stock or restricted common stock or to grant incentive stock options or nonqualified stock options for the purchase of common stock, to employees, members of the Board, and consultants of the Company. The 2019 Plan is administered by the Board or at the discretion of the Board by a committee of the Board. The exercise prices, vesting periods, and other restrictions are determined at the discretion of the Board or a committee of the Board, except that the exercise price per share of stock options may not be less than 100% of the fair market value of the share of common stock on the date of grant and the contractual term of stock option may not be greater than 10 years. Stock options granted to date typically vest and become exercisable over four years from the date of grant.

As of the date the 2024 Plan became effective, there will be no further awards granted under the 2019 Plan, but all outstanding awards under the 2019 Plan will continue to be governed by their existing terms.1,820,649 stock options to purchase common stock were outstanding under the 2019 Plan as of June 30, 2026.

2024 Stock Option and Incentive Plan

In August 2024, the Company's board of directors adopted, and its stockholders approved, the 2024 Plan, which became effective in September 2024. The 2024 Plan allows the Company to make equity-based and cash-based incentive awards to its officers, employees, directors and consultants. The 2024 Plan provides for the grant of incentive stock options, stock options, stock appreciation rights, restricted shares of common stock, RSUs, dividend equivalent rights and cash bonuses. The number of shares initially reserved for issuance under the 2024 Plan was 3,065,000 shares. In addition, the number of shares reserved and available for issuance under the 2024 Plan will automatically increase on January 1, 2025 and each January 1 thereafter, byfive percent (5%) of the sum of the outstanding number of shares of common stock and the numbers of shares of common stock issuable pursuant to the exercise of any outstanding warrants to acquire common stock for a nominal exercise price on the immediately preceding December 31 or such lesser number of shares as determined by the compensation committee. The number of shares reserved under the 2024 Plan is subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization. As of June 30, 2026,2,740,557 stock options to purchase common stock and 162,493 RSUs were outstanding under the 2024 Plan, and 4,140,451 shares remained available for future grant under the 2024 Plan. The shares available for issuance under the 2024 Plan may be authorized but unissued shares or shares reacquired by the Company.

The shares of common stock underlying any awards under the 2024 Plan and the 2019 Plan that are forfeited, cancelled, held back upon exercise or settlement of an award to satisfy the exercise price or tax withholding, reacquired by the Company prior to vesting, satisfied without the issuance of stock, expire or are otherwise terminated (other than by exercise) will be added back to the shares of common stock available for issuance under the 2024 Plan.

2024 Employee Stock Purchase Plan

In August 2024, the Company's board of directors adopted, and its stockholders approved, the 2024 ESPP, which became effective in September 2024. A total of 289,436 shares of common stock were initially reserved for issuance under the 2024 ESPP. The 2024 ESPP provides that the number of shares reserved and available for issuance will automatically increase on January 1, 2025 and each January 1 thereafter, by the least of (i)578,872 shares of common stock, (ii)one percent (1%) of the number of shares of common stock issued and outstanding on the immediately preceding December 31, or (iii) such lesser number of shares of common stock as determined by the administrator of the 2024 ESPP. The number of shares reserved under the 2024 ESPP is subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization. During the six months ended June 30, 2026, the Company recognized $0.2 million of expense related to the 2024 ESPP. As of June 30, 2026,1,062,708 shares remained available for issuance under the 2024 ESPP.10,222 shares were issued under the 2024 ESPP during thethree and six months ended June 30, 2026. No shares were issued under the 2024 ESPP during the three and six months ended June 30, 2025.

2026 Inducement Plan

In March 2026, the Company's board of directors adopted and approved the 2026 Plan. The 2026 Plan allows the Company to make equity-based and cash-based incentive awards to its officers, employees, directors and consultants. The 2026 Plan provides for the grant of nonqualified stock options, stock options, stock appreciation rights, restricted shares of common stock, RSUs, dividend equivalent rights and cash bonuses. The number of shares initially reserved for issuance under the 2026 Plan is 130,000 shares. Also, in March 2026, the Company's board of directors approved an increase to the shares reserved under the 2026 Plan to 900,000. The number of shares reserved under the 2026 Plan is subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization. As of June 30, 2026,610,000 shares remained available for issuance under the 2026 Plan.290,000 stock options to purchase common stock were outstanding under the 2026 Plan as of June 30, 2026.

Stock option valuation

The determination of the grant date fair value of stock-based awards granted to employees, directors and nonemployees during thesix months ended June 30, 2026 and 2025, was estimated using the Black-Scholes option-pricing model and was calculated based on the following assumptions.

Summary of option activity

The Company’s stock option activity regarding employees, directors, and nonemployees for thesix months ended June 30, 2026, is summarized as follows (in thousands except share and per share amounts):

Additional information with regard to stock option activity involving employees and directors for the six months ended June 30, 2026 and 2025, is as follows (in thousands except per share amounts):

As of June 30, 2026, total unrecognized compensation cost related to the unvested stock option awards to employees, directors, and nonemployees is $47.0 million, which is expected to be recognized over a weighted-average period of 3.0 years.

Summary of restricted stock unit activity

The fair values of RSUs are based on the fair market value of the Company's common stock on the date of grant. Each RSU represents a contingent right to receive one share of the Company's common stock upon vesting. In general, RSUs vest in equal quarterly installments over four years from the grant date. The following table summarizes the Company's RSU activity for thesix months ended June 30, 2026 (in thousands except share and per share amounts):

As of June 30, 2026, total unrecognized stock compensation expense related to the unvested RSUs to employees is $6.5 million, which is expected to be recognized over a weighted average period of 3.6 years.

Stock-based compensation

During thethree and six months ended June 30, 2026 and 2025, the Company recorded stock-based compensation expense regarding its employees, directors, and nonemployees as follows (in thousands):

defined contribution plan

The Company established a defined contribution savings plan under Section 401(k) of the Internal Revenue Code. This plan covers substantially all employees who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pretax basis. In the year ended December 31, 2025, the Company began contributing to the plan on behalf of its employees and made contributions of $0.1 million and $0.2 million to the plan in thethree and six months ended June 30, 2026, respectively. In each of the three and six months ended June 30, 2025, the Company made contributions of $0.1 million to the plan.

Net loss per share attributable to common stockholders

Net loss per share

The following table summarizes the computation of basic and diluted net loss per share attributable to common stockholders of the Company (in thousands except share and per share amounts).

The Company’s potential dilutive securities, which include convertible preferred stock, restricted stock related to early exercise of common stock options, restricted stock related to unvested founder shares and outstanding common stock options, have been excluded from the computation of diluted net loss per share as the effect would be antidilutive. Therefore, the weighted average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to common stockholders is the same. The potential dilutive securities included in the table below, presented on an as converted basis, were excluded from the calculation of net loss per share due to their anti-dilutive effect:

Related Party transactions

In May 2026, the Company entered into a consulting agreement with Steven Hoerter, the executive chair of the Company's board of directors, to provide additional strategic advisory services to the Company. Mr. Hoerter was no longer considered an independent director of the board per Nasdaq Listing Rules as of the effective date of the consulting agreement. In connection with the consulting agreement, Mr. Hoerter was awarded a grant of 74,249 nonqualified stock options and a grant of 11,938 restricted stock units. In July 2026, the Board appointed Mr. Hoerter to serve as the Company's President and Chief Executive Officer ("CEO") and principal executive officer of the Company, as further described in Note 17. The consulting agreement with Mr. Hoerter was terminated effective as of his appointment as President and CEO.

16. SEGMENT INFORMATION

The Company operates as asingle reportable segment engaged in the discovery and development of novel precision peptide therapies for the treatment of endocrine and metabolic disorders. The Company's determination that it operates as asingle segment is consistent with the nature of its operations and the financial information regularly reviewed by thechief executive officer, in his capacity as the chief operating decision maker (CODM), for the purposes of evaluating performance, allocating resources, setting incentive compensation targets, and planning and forecasting for future periods. The Company's purpose is to help people with endocrine and metabolic disorders live fuller and healthier lives. The Company's long-term success is significantly dependent on its ability to research and develop innovative medicines. The CODM uses net loss to assess performance of the Company, ensuring that it is investing in the research and development of product candidates. The CODM allocates research and development resources based upon several factors, including the likelihood of technical success, unmet medical needs, and the viability of commercial success. A significant component of the CODM’s decision-making process is to ensure a balanced investment in the research and development portfolio to drive near-term success and long-term sustainability.

The following table summarizes our significant segment expenses and segment net loss for thethree and six months ended June 30, 2026 and 2025 (in thousands):

(1)Other segment items are primarily comprised of general and administrative expenses and interest and other income.

17. SUBSEQUENT EVENTS

On July 9, 2026, the Company announced Kent P. Hawryluk's departure from his role as the Company's chief executive officer and a member of the Company's board of directors effective July 13, 2026. Mr. Hawryluk will assist the Board and the Company’s new CEO with the transition and will provide strategic advisory services through August 16, 2026 under the terms of a consulting agreement entered into with the Company that became effective upon Mr. Hawryluk’s separation from the Company. Mr. Hawryluk’s departure is not due to a dispute or disagreement with the Company or the Company’s auditors.

Pursuant to the terms of Mr. Hawryluk's separation agreement, certain outstanding equity awards will continue to vest following termination and certain awards will be accelerated. Based on a preliminary assessment of the terms of the separation agreement, the Company expects to recognize stock-based compensation expense ranging from approximately $15 million to $20 million during the third quarter of 2026. The Company is continuing to evaluate the accounting implications of the terms of the separation agreement, and the ultimate amount recognized may differ materially from these preliminary estimates. No amounts associated with the separation agreement have been reflected in the accompanying financial statements because the termination occurred after June 30, 2026.

On July 9, 2026, the Board appointed Steven Hoerter as President and CEO and principal executive officer of the Company, effective as of July 13, 2026.

On July 9, 2026, the Board appointed John Smither as Chief Financial Officer and principal financial officer and principal accounting officer of the Company, effective as of July 13, 2026.