Aardvark Therapeutics, Inc.

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q (Quarterly Report). This discussion and other parts of this Quarterly Report contain forward-looking statements that involve risk, assumptions and uncertainties, such as statements of our plans, objectives, expectations, intentions, forecasts and projections. Our actual results and the timing of selected events could differ materially from those discussed in these forward-looking statements as a result of several factors, including those set forth under Part II, Item 1A, “Risk Factors”, of this Quarterly Report and elsewhere in this Quarterly Report. You should carefully read Part II, Item 1A, “Risk Factors”, of this Quarterly Report to gain an understanding of the important factors that could cause actual results to differ materially from our forward-looking statements. Please also see the section titled “Special Note Regarding Forward-Looking Statements” below.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q (Quarterly Report). This discussion and other parts of this Quarterly Report contain forward-looking statements that involve risks, assumptions and uncertainties, such as statements of our plans, objectives, expectations, intentions, forecasts and projections. Our actual results and the timing of selected events could differ materially from those discussed in these forward-looking statements as a result of several factors, including those set forth under Part II, Item 1A, “Risk Factors”, of this Quarterly Report and elsewhere in this Quarterly Report. You should carefully read Part II, Item 1A, “Risk Factors”, of this Quarterly Report to gain an understanding of the important factors that could cause actual results to differ materially from our forward-looking statements. Please also see the section titled “Special Note Regarding Forward-Looking Statements” below.

Previous wording

the initiation, timing, progress, status and results of our preclinical studies, clinical trials and research and development programs for our product candidates, and our anticipated timeline for providing further guidance on, or results of, our preclinical studies and clinical trials;

Current wording

the initiation, timing, progress, status and results of our preclinical studies, clinical trials and research and development programs for our product candidates, the timing and outcome of our regulatory interactions, our evaluation of potential future development plans and our anticipated timing for providing updates regarding our preclinical studies and clinical trials;

Previous wording

our ability to efficiently and cost-effectively conduct our current and future clinical trials;

Current wording

our ability to efficiently and cost-effectively conduct our clinical trials;

Previous wording

We have based the forward-looking statements contained in this Quarterly Report primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations or growth prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described in Part II, Item 1A,“Risk Factors”, of this Quarterly Report and this Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, of this Quarterly Report and elsewhere in this Quarterly Report. Moreover, we operate in a very competitive and challenging environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements. You should, however, review the factors and risks we describe in the reports we will file from time to time with the Securities and Exchange Commission (SEC) after the date of this Quarterly Report.

Current wording

We have based the forward-looking statements contained in this Quarterly Report primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations or growth prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described in Part II, Item 1A,“Risk Factors”, of this Quarterly Report, this Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, of this Quarterly Report and elsewhere in this Quarterly Report. Moreover, we operate in a very competitive and challenging environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements. You should, however, review the factors and risks we describe in the reports we will file from time to time with the Securities and Exchange Commission (SEC) after the date of this Quarterly Report.

Previous wording

TAS2Rs are a family of 26 different nutrient-sensing G protein-coupled receptors (GPCRs) that are broadly expressed among vertebrates. TAS2Rs are present in the oral cavity to convey bitter taste and are highly expressed in many other tissues throughout the body where they are key in regulating metabolic and inflammatory pathways. CCK has long been recognized as a promising pharmaceutical target because its release is triggered with food and it helps suppress hunger, which is the feeling of discomfort that comes from a perception of not having eaten recently. We believe suppression of hunger could be complementary to the suppression of appetite reported from patients on GLP-1 receptor targeted treatments, which reduce the desirability of food. Previous approaches to directly agonize CCK receptors through exogenous molecules have been limited by safety concerns driven by systemic exposure, resulting in on-target activity in undesired tissues and have been associated with pancreatic safety concerns, including pancreatitis. Our wholly-owned lead product candidate, ARD-101, is an oral, largely gut-restricted small-molecule agonist of certain TAS2Rs expressed on luminally accessible enteroendocrine cells lining the gut. ARD-101, in contrast to previous approaches to directly agonize CCK receptors, elicits the endogenous release of CCK by leveraging the body’s natural response to TAS2R agonism. To our knowledge, besides our product candidates, there are no approved therapies and no other clinical-stage candidates that directly target TAS2Rs.

Current wording

TAS2Rs are a family of 26 different nutrient-sensing G protein-coupled receptors (GPCRs) that are broadly expressed among vertebrates. TAS2Rs are present in the oral cavity to convey bitter taste and are highly expressed in many other tissues throughout the body where they are key in regulating metabolic and inflammatory pathways. CCK has long been recognized as a promising pharmaceutical target because its release is triggered with food and it helps suppress hunger, which is the feeling of discomfort that comes from a perception of not having eaten recently. We believe suppression of hunger could be complementary to the suppression of appetite reported by patients on GLP-1 receptor targeted treatments, which reduce the desirability of food. Previous approaches to directly agonize CCK receptors through exogenous molecules have been limited by safety concerns driven by systemic exposure, resulting in on-target activity in undesired tissues and have been associated with pancreatic safety concerns, including pancreatitis. Our wholly-owned lead product candidate, ARD-101, is an oral, largely gut-restricted small-molecule agonist of certain TAS2Rs expressed on luminally accessible enteroendocrine cells lining the gut. ARD-101, in contrast to previous approaches to directly agonize CCK receptors, elicits the endogenous release of CCK by leveraging the body’s natural response to TAS2R agonism. To our knowledge, besides our product candidates, there are no approved therapies and no other clinical-stage candidates that directly target TAS2Rs.

Previous wording

In the second quarter of 2025, we initiated dosing for a Phase 3 clinical trial for hyperphagia associated with PWS, which we refer to as the HERO (Hunger Elimination or Reduction Objective) trial. We previously reached alignment with the FDA on a protocol for a Phase 3 clinical trial, which we initiated in December 2024. In August 2025, we submitted a protocol amendment to remove the use of anti-psychotics and insulin-requiring type 2 diabetes as exclusion criteria for the clinical trial. In October 2025, we reached alignment with the FDA on a protocol amendment to lower the minimum age of eligibility to participate in the trial from 13 to 10 years of age. This change broadened the eligible trial population and expanded the potential addressable opportunity within PWS. In December 2025, we submitted an additional protocol amendment seeking to further lower the minimum age of eligibility to participate in the trial to 7 years of age. During the third quarter of 2025, we commenced enrollment for the HERO Open Label Extension (OLE) trial, which was available to patients completing the HERO trial and we initiated our first clinical sites in Australia. In January 2026, we announced over 50% completion of the target enrollment of 90 patients in the HERO trial and within the first quarter of 2026, we initiated clinical sites in the UK, South Korea and Canada.

Current wording

In the second quarter of 2025, we initiated dosing for a Phase 3 clinical trial for hyperphagia associated with PWS, which we refer to as the HERO (Hunger Elimination or Reduction Objective) trial. We previously reached alignment with the FDA on a protocol for a Phase 3 clinical trial, which we initiated in December 2024. In August 2025, we submitted a protocol amendment to remove the use of anti-psychotics and insulin-requiring type 2 diabetes as exclusion criteria for the clinical trial. In October 2025, we reached alignment with the FDA on a protocol amendment to lower the minimum age of eligibility to participate in the trial from 13 to 10 years of age. This change broadened the eligible trial population and expanded the potential addressable opportunity within PWS. In December 2025, we submitted an additional protocol amendment seeking to further lower the minimum age of eligibility to participate in the trial to 7 years of age. During the third quarter of 2025, we commenced enrollment for the HERO Open

Previous wording

Our second TAS2R program, ARD-201, was planned to be a fixed-dose combination of ARD-101 and a dipeptidyl peptidase-4 (DPP-4) inhibitor for the treatment of obesity and obesity-related conditions, including the prevention of weight regain following treatment with GLP-1 receptor agonists, which we believe may address an important unmet need in the long-term management of obesity. We previously initiated a Phase 2 clinical trial, which we referred to as the POWER (Prevention Of WEight Regain) trial, in December 2025, to explore the efficacy of ARD-201 in the prevention of weight regain among patients who have successfully lost over 15% of body weight on GLP-1RA therapy. In addition, we previously planned to initiate a second Phase 2 trial for ARD-201 in the first half of 2026, which we referred to as the STRENGTH (Sitagliptin and TAS2R for weight Reduction with Exercise, Nutrition, and GLP-1RAT rial and Hunger assessment) trial. Because ARD-201 contains ARD-101 as a component of the planned combination therapy, we are assessing the potential implications of the voluntary pause of the HERO trial on the ARD-201 program, including the potential impact of the safety observations identified in the healthy volunteer study in the ARD-101 program on the development of ARD-201. Following this assessment, we have voluntarily paused the STRENGTH and POWER clinical trials, in addition to the HERO and OLE trials (collectively, the “voluntarily paused clinical programs”), while we complete our ongoing evaluation of the safety observations identified in the healthy volunteer study of ARD-101 and continue discussions with the FDA regarding next steps for the ARD-101 program. We expect to provide further guidance in the second quarter of 2026.

Current wording

Our second TAS2R program, ARD-201, was planned to be a fixed-dose combination of ARD-101 and a dipeptidyl peptidase-4 (DPP-4) inhibitor for the treatment of obesity and obesity-related conditions, including the prevention of weight regain following treatment with GLP-1 receptor agonists, which we believe may address an important unmet need in the long-term management of obesity. We previously initiated a Phase 2 clinical trial, which we referred to as the POWER (Prevention Of WEight Regain) trial, in December 2025, to explore the efficacy of ARD-201 in the prevention of weight regain among patients who have successfully lost over 15% of body weight on GLP-1RA therapy. In addition, we previously planned to initiate a second Phase 2 trial for ARD-201 in the first half of 2026, which we referred to as the STRENGTH (Sitagliptin and TAS2R for weight Reduction with Exercise, Nutrition, and GLP-1RAT rial and Hunger assessment) trial. Because ARD-201 contains ARD-101 as a component of the planned combination therapy, the timing of further development of ARD-201 depends on the resolution of the clinical hold applicable to ARD-101 and future regulatory discussions regarding that program. We intend to provide updates regarding the ARD-101 program as appropriate.

Previous wording

In preparation for these trials, we expanded our clinical management and regulatory capabilities, including hiring clinical, regulatory, CMC and quality personnel, and we expect to continue to need to expand our clinical management and regulatory capabilities and to rely on third parties to conduct our later stage or pivotal clinical trials in the future. However, the timing of additional staffing and operational expansion may be delayed as we evaluate next steps following the voluntary pause of our clinical programs, although we expect to continue to build our capabilities over time as our clinical programs progress, subject to the outcome of our ongoing review and discussions with the FDA.

Current wording

In preparation for these trials, we expanded our clinical management and regulatory capabilities, including hiring clinical, regulatory, chemistry, manufacturing and controls (CMC) and quality personnel, and expect to rely on third parties to conduct our later stage or pivotal clinical trials in the future. Following the clinical hold, we implemented a workforce reduction to align our organization and cost structure with our current operating priorities while maintaining the capabilities necessary to support our ongoing activities and potential future development plans for ARD-101.

Previous wording

Since we commenced operations in 2017, we have devoted substantially all of our resources to organizing and staffing our company, business planning, raising capital, discovering ARD-101, establishing and maintaining our intellectual property portfolio, conducting research, preclinical studies, and clinical trials, manufacturing of ARD-101 and related raw materials, and providing general and administrative support for these operations.

Current wording

Since we commenced operations in 2017, we have devoted substantially all of our resources to organizing and staffing our company, business planning, raising capital, discovering ARD-101, establishing and maintaining our intellectual property portfolio, conducting research, preclinical studies, and clinical trials, manufacturing ARD-101 and related raw materials, and providing general and administrative support for these operations.

Previous wording

We have incurred significant net losses and negative cash flows from operations since our inception and, as of March 31, 2026, we had an accumulated deficit of $137.5 million. Our net losses for the three months ended March 31, 2026 and 2025 were $21.6 million and $9.3 million, respectively. We expect our expenses and operating losses will increase substantially for the foreseeable future as we:

Current wording

We have incurred significant net losses and negative cash flows from operations since our inception and, as of June 30, 2026, we had an accumulated deficit of $151.9 million. Our net losses for the six months ended June 30, 2026 and 2025 were $36.0 million and $23.7 million, respectively. We expect our net losses to continue for the foreseeable future as we:

Previous wording

From inception and up to the date of our initial public offering (IPO) in February 2025, we had raised a total of $129.1 million in gross proceeds to fund our operations from the sale and issuance of shares of our convertible preferred stock. In February 2025, we completed our IPO with the sale of 6,120,661 shares of common stock, which included the partial exercise by the underwriters of their option to purchase 232,661 additional shares, at an IPO price of $16.00 per share and received net proceeds of approximately $87.5 million. As of March 31, 2026, we had cash, cash equivalents and short-term investments of $91.2 million. Based upon our current operating plans, we believe that our existing cash, cash equivalents and short-term investments will be sufficient to fund our projected operations into mid-2027. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. In February 2026, we voluntarily paused enrollment and dosing in the Phase 3 HERO trial and the open label extension trial for ARD-101, and the POWER and STRENGTH clinical trials for ARD-201 based on reversible cardiac observations in a healthy volunteer study of ARD-101. The voluntary pause of these clinical trials may affect the timing and amount of our future expenditures and our need for additional capital, depending on the outcome of our ongoing data review and discussions with the FDA regarding next steps for our clinical programs.

Current wording

From inception and up to the date of our initial public offering (IPO) in February 2025, we had raised a total of $129.1 million in gross proceeds to fund our operations from the sale and issuance of shares of our convertible preferred stock. In February 2025, we completed our IPO with the sale of 6,120,661 shares of common stock, which included the partial exercise by the underwriters of their option to purchase 232,661 additional shares, at an IPO price of $16.00 per share and received net proceeds of approximately $87.5 million. As of June 30, 2026, we had cash, cash equivalents and short-term investments of $73.9 million. Based upon our current operating plans, we believe that our existing cash, cash equivalents and short-term investments will be sufficient to fund our projected operations into late 2027. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. In February 2026, we voluntarily paused enrollment and dosing in the Phase 3 HERO trial and the OLE trial for ARD-101, and the POWER and STRENGTH clinical trials for ARD-201 based on reversible cardiac observations in a healthy volunteer study of ARD-101. Subsequently, the FDA placed the ARD-101 program on clinical hold in May 2026 and we terminated the HERO and OLE clinical trials in June 2026. The termination of these trials, the clinical hold applicable to the ARD-101 program and our revised operating plan may affect the timing and amount of our future expenditures and our need for additional capital, depending on the outcome of our ongoing regulatory activities and interactions with the FDA.

Previous wording

We do not own or operate, and currently have no plans to establish, any manufacturing facilities. We rely, and expect to continue to rely, on third parties for the manufacture of our ARD-101 and our other product candidates for preclinical and clinical testing, as well as for commercial manufacture if ARD-101 or any of our other product candidates obtain marketing approval. We are working with our current manufacturers to ensure that we will be able to scale up our manufacturing capabilities to support our clinical plans. In addition, we rely on third parties to package, label, store, and distribute ARD-101, and we intend to rely on third parties for our commercial products if marketing approval is obtained. We believe that this strategy allows us to maintain a more efficient infrastructure by eliminating the need for us to invest in our own manufacturing facilities, equipment, and personnel while also enabling us to focus our expertise and resources on the discovery and development of ARD-101 and our other product candidates.

Current wording

We do not own or operate, and currently have no plans to establish, any manufacturing facilities. We rely, and expect to continue to rely, on third parties for the manufacture of ARD-101 and our other product candidates for preclinical and clinical testing, as well as for commercial manufacture if ARD-101 or any of our other product candidates obtain marketing approval. We are working with our current manufacturers and certain third parties to ensure that we will be able to scale up our manufacturing capabilities to support our clinical plans. In addition, we rely on third parties to package, label, store, and distribute ARD-101, and we intend to rely on third parties for our commercial products if marketing approval is obtained. We believe that this strategy allows us to maintain a more efficient infrastructure by eliminating the need for us to invest in our own manufacturing facilities, equipment, and personnel while also enabling us to focus our expertise and resources on the discovery and development of ARD-101 and our other product candidates.

Previous wording

We have appointed a Chief Commercial Officer; however, given our stage of development, we have not yet built out a marketing or sales organization or commercial infrastructure. We intend to build the necessary sales, marketing and commercialization capabilities and infrastructure over time as our product candidates advance through clinical development if and when our product candidates advance through clinical development and receive regulatory approval. We expect to spend a significant amount in commercial development and marketing costs prior to obtaining regulatory and marketing approval of one or more of our product candidates.

Current wording

We have not yet built out a marketing or sales organization or commercial infrastructure. We intend to build the necessary sales, marketing and commercialization capabilities and infrastructure over time as our product candidates advance through clinical development if and when our product candidates advance through clinical development and receive regulatory approval. We expect to spend a significant amount in commercial development and marketing costs prior to obtaining regulatory and marketing approval of one or more of our product candidates.

Previous wording

We may be affected by unfavorable economic conditions and challenges in the United States and abroad, such as the effects of the ongoing conflicts in the Middle East, including the war in Iran and its surrounding regions, and between Russia and Ukraine, sanctions against Russia, the instability in Venezuela, disruptions in the banking industry and inflationary trends. The fiscal years 2025 and 2024 were marked by significant market uncertainty and increasing inflationary pressures. These market dynamics are expected to continue in 2026, and these and similar adverse market conditions may negatively impact our business, financial position, results of operations and growth prospects. For further discussion of the potential impacts of macroeconomic events on us, refer to Part II, Item 1A, “Risk Factors”, of this Quarterly Report.

Current wording

We may be affected by unfavorable economic conditions and challenges in the United States and abroad, such as the effects of the ongoing conflicts in the Middle East, including the war in Iran and its surrounding regions, and between Russia and Ukraine, sanctions against Russia, the instability in Venezuela, disruptions in the banking industry and inflationary trends. The first half of fiscal year 2026 and fiscal years 2025 and 2024 were marked by significant market uncertainty and increasing inflationary pressures. These market dynamics are expected to continue for the remainder of 2026, and these and similar adverse market conditions may negatively impact our business, financial position, results of operations and growth prospects. For further discussion of the potential impacts of macroeconomic events on us, refer to Part II, Item 1A, “Risk Factors”, of this Quarterly Report.

Previous wording

Although R&D activities are central to our business model, the successful development of ARD-101 and our other product candidates is highly uncertain. We cannot determine with certainty the timing of initiation, the duration or the completion costs of current or future preclinical studies and clinical trials of ARD-101 or any other current or future product candidates due to the inherently unpredictable nature of preclinical and clinical development. There are numerous factors associated with the successful development of a product candidate, including future trial design and various regulatory requirements, many of which cannot be determined with accuracy at this time based on our stage of development. In addition, future regulatory factors beyond our control may impact our clinical development programs. Product candidates in later stages of development generally have higher development costs than those in earlier stages of development. As a result, we expect that our R&D expenses will increase substantially for the foreseeable future as we continue to conduct our ongoing R&D activities, advance preclinical research programs toward clinical development, conduct clinical trials, hire additional personnel, and maintain, expand, protect, and enforce our intellectual property portfolio.

Current wording

Although R&D activities are central to our business model, the successful development of ARD-101 and our other product candidates is highly uncertain. We cannot determine with certainty the timing of initiation, the duration or the completion costs of current or future preclinical studies and clinical trials of ARD-101 or any other current or future product candidates due to the inherently unpredictable nature of preclinical and clinical development. There are numerous factors associated with the successful development of a product candidate, including future trial design and various regulatory requirements, many of which cannot be determined with accuracy at this time based on our stage of development. In addition, future regulatory factors beyond our control may impact our clinical development programs. Product candidates in later stages of development generally have higher development costs than those in earlier stages of development. In the near-term, while we resolve the clinical hold and future development plans for ARD-101, we expect our R&D expenses to decrease over levels of comparative periods of the prior year.

Previous wording

the timing, receipt, and terms of any approvals from applicable regulatory authorities; and

Current wording

the timing, receipt, and terms of any approvals from applicable regulatory authorities, including resolution of any clinical holds; and

Previous wording

The process of conducting the necessary preclinical and clinical research to obtain regulatory approval is costly and time-consuming. The actual probability of success for ARD-101 or any other current or future product candidates may be affected by a variety of factors. We may never succeed in achieving regulatory approval for any of our product candidates. Preclinical and clinical development timelines, the probability of success, and total development costs can differ materially from expectations. We anticipate that we will make determinations as to which product candidates to pursue and how much funding to direct to each product candidate on an ongoing basis in response to the results of ongoing and future preclinical studies and clinical trials, regulatory developments, and our ongoing assessments as to each product candidates’ commercial potential. We will need to raise substantial additional capital in the future. In addition, we cannot forecast which product candidate may be subject to future collaborations, when such arrangements will be secured, if at all, and to what degree such arrangements would affect our development plans and capital requirements.

Current wording

The process of conducting the necessary preclinical and clinical research to obtain regulatory approval is costly and time-consuming. The actual probability of success for ARD-101 or any other current or future product candidates may be affected by a variety of factors. We may never succeed in achieving regulatory approval for any of our product candidates. Preclinical and clinical development timelines, the probability of success, and total development costs can differ materially from expectations. We anticipate that we will make determinations as to which product candidates to pursue and how much funding to direct to each product candidate on an ongoing basis in response to the results of future preclinical studies and clinical trials, regulatory developments, and our ongoing assessments as to each product candidate's commercial potential. We will need to raise substantial additional capital in the future. In addition, we cannot forecast which product candidate may be subject to future collaborations, when such arrangements will be secured, if at all, and to what degree such arrangements would affect our development plans and capital requirements.

Previous wording

Other income, net was $0.9 million and $1.2 million for the three months ended March 31, 2026 and 2025, respectively. The $0.3 million decrease for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 resulted from lower interest income generated by our lower invested cash balances.

Current wording

Other income, net was $0.7 million and $1.5 million for the three months ended June 30, 2026 and 2025, respectively. The $0.8 million decrease for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025 resulted from lower interest income generated by our lower invested balances.

Previous wording

R&D expenses were $16.6 million and $7.8 million for the three months ended March 31, 2026 and 2025, respectively. The $8.8 million increase for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 resulted primarily from an increase of $7.1 million for external expenses incurred for chemistry, manufacturing and controls (CMC), clinical and toxicology studies primarily related to the development of ARD-101 and a $1.7 million increase in personnel-related costs due to increased headcount and bonuses.

Current wording

R&D expenses were $27.0 million and $20.9 million for the six months ended June 30, 2026 and 2025, respectively. The $6.1 million increase for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025 resulted primarily from an increase of $3.8 million for external expenses incurred for CMC, clinical and toxicology studies primarily related to the development of ARD-101 and a $2.3 million increase in personnel-related costs due primarily to increased headcount prior to the workforce reduction.

Previous wording

G&A expenses were $5.9 million and $2.7 million for the three months ended March 31, 2026 and 2025, respectively. The $3.2 million increase for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 resulted primarily from a $2.1 million increase in personnel-related costs due to increased headcount and bonuses, a $0.6 million increase in legal and other professional costs, and a $0.3 million increase in facilities and other costs. The increase in non-facilities costs were partially related to commencing operations as a public company in February 2025.

Current wording

G&A expenses were $10.5 million and $5.4 million for the six months ended June 30, 2026 and 2025, respectively. The $5.1 million increase for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025 primarily resulted from a $4.0 million increase in personnel-related costs, a $0.4 million increase in facilities and other costs, and a $0.7 million increase in legal and other professional costs. The increase in non-facilities costs was partially related to commencing operations as a public company in February 2025.

Previous wording

As of March 31, 2026, we had cash, cash equivalents and short-term investments of $91.2 million. Based upon our current operating plans, we believe that our existing cash, cash equivalents and short-term investments will be sufficient to fund our projected operations into mid-2027. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. We have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we expect. Additionally, the process of conducting preclinical studies, manufacturing and testing product candidates in clinical trials is costly, and the timing of progress and expenses in these studies and trials is uncertain. In February 2026, we voluntarily paused enrollment and dosing in our Phase 3 HERO trial and the open label extension trial for ARD-101, and the POWER and STRENGTH clinical trials for ARD-201. The voluntary pause of these clinical trials may affect the timing and amount of our future expenditures and our need for additional capital, depending on the outcome of our ongoing data review and discussions with the FDA regarding next steps for our voluntarily paused clinical programs.

Current wording

As of June 30, 2026, we had cash, cash equivalents and short-term investments of $73.9 million. Based upon our current operating plans, we believe that our existing cash, cash equivalents and short-term investments will be sufficient to fund our projected operations into late 2027. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. We have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we expect. Additionally, the process of conducting preclinical studies, manufacturing and testing product candidates in clinical trials is costly, and the timing of progress and expenses in these studies and trials is uncertain. In February 2026, we voluntarily paused enrollment and dosing in our Phase 3 HERO trial and the OLE trial for ARD-101, and the POWER and STRENGTH clinical trials for ARD-201. Subsequently, the FDA placed the ARD-101 program on clinical hold in May 2026. The clinical hold applicable to the ARD-101 program and our revised operating plan may affect the timing and amount of our future expenditures and our need for additional capital, depending on the outcome of our ongoing regulatory activities and interactions with the FDA.

Previous wording

We have incurred significant operating losses since our inception and, as of March 31, 2026, we had an accumulated deficit of $137.5 million. We expect to continue to incur losses for the foreseeable future, and we anticipate these losses will increase substantially for the reasons described above.

Current wording

We have incurred significant operating losses since our inception and, as of June 30, 2026, we had an accumulated deficit of $151.9 million. We expect to continue to incur operating losses for the foreseeable future.

Previous wording

the costs and timing of manufacturing for our product candidates, including commercial manufacture at sufficient scale, if any product candidate is approved;

Current wording

the costs and timing of manufacturing our product candidates, including commercial manufacture at sufficient scale, if any product candidate is approved;

Previous wording

the costs, timing, and outcome of regulatory meetings and reviews of our product candidates;

Current wording

the costs, timing, and outcome of regulatory meetings and reviews of our product candidates, including resolution of any clinical holds;

Previous wording

our efforts to enhance operational systems and hire additional personnel to satisfy our obligations as a public company, including enhanced internal control over financial reporting;

Current wording

our efforts to maintain the operational capabilities necessary to satisfy our obligations as a public company and support our regulatory activities and potential future development plans, including enhanced internal control over financial reporting;

Previous wording

the costs and timing of establishing or securing sales and marketing capabilities if any product candidates is approved;

Current wording

the costs and timing of establishing or securing sales and marketing capabilities if any product candidates are approved;

Previous wording

Net cash used in operating activities was $18.9 million and $11.4 million for the three months ended March 31, 2026 and 2025, respectively. The net cash used in operating activities during the three months ended March 31, 2026 was primarily due to our reported net loss of $21.6 million, net of non-cash items (including unrealized losses on short-term investments, stock-based compensation expense, non-cash lease expense and amortization of discount on short-term investments) totaling $2.0 million and a $0.7 million net decrease of our net operating assets. The net cash used in operating activities during the three months ended March 31, 2025 was primarily due to our reported net loss of $9.3 million, net of non-cash charges (including unrealized losses on short-term investments, stock-based compensation expense, non-cash lease expense and amortization of discount on short-term investments) totaling $0.3 million and a $2.4 million net increase of our net operating assets. The increase in cash used in operations during the three months ended March 31, 2026 in comparison to the three months ended March 31, 2025 was primarily attributable to increased research and development activities.

Current wording

Net cash used in operating activities was $36.5 million and $21.2 million for the six months ended June 30, 2026 and 2025, respectively. The net cash used in operating activities during the six months ended June 30, 2026 was primarily due to our reported net loss of $36.0 million, net of non-cash items (including unrealized losses on short-term investments, stock-based compensation expense, non-cash lease expense and amortization of discount on short-term investments) totaling $4.0 million and a $4.5 million net increase of our net operating assets. The net cash used in operating activities during the six months ended June 30, 2025 was primarily due to our reported net loss of $23.7 million, net of non-cash charges (including unrealized losses on short-term investments, stock-based compensation expense, non-cash lease expense and amortization of discount on short-term investments) totaling $0.4 million and a $2.0 million net decrease of our net operating assets. The increase in cash used in operations during the six months ended June 30, 2026 in comparison to the six months ended June 30, 2025 was primarily attributable to increased research and development and supporting activities.

Previous wording

Net cash provided by investing activities during the three months ended March 31, 2026 was $34.3 million resulting from the sales and maturities of short-term investments during the period. Net cash used in investing activities was $112.6 million during the three months ended March 31, 2025 primarily as a result of the purchase of short-term investments during the period, offset by maturities of short-term investments during the period.

Current wording

Net cash provided by investing activities during the six months ended June 30, 2026 was $63.0 million resulting from the sales and maturities of short-term investments during the period. Net cash used in investing activities was $103.2 million during the six months ended June 30, 2025 primarily as a result of the purchase of short-term investments during the period, offset by maturities of short-term investments during the period.

Previous wording

Net cash provided by financing activities during the three months ended March 31, 2026 was $4,000 and resulted from sales of common stock under our employee equity plans. Net cash provided by financing activities during the three months ended March 31, 2025 was $88.9 million and resulted primarily from the proceeds from the sale and issuance of shares of our common stock in our IPO in February 2025 for proceeds of $91.1 million, offset by payments for IPO costs of $2.3 million.

Current wording

Net cash provided by financing activities during the six months ended June 30, 2026 was $0.3 million resulting from the sale of common stock under our employee equity plans. Net cash provided by financing activities during the six months ended June 30, 2025 was $88.8 million and resulted primarily from the proceeds from the sale and issuance of shares of our common stock in our IPO in February 2025 for proceeds of $91.1 million, offset by payments for IPO costs of $2.4 million.