Jaguar Health, Inc.

Previous wording

Jaguar Health, Inc. (“Jaguar”), in conjunction with Jaguar family company Napo Pharmaceuticals, Inc. (“Napo”), develops novel proprietary prescription drugs sustainably derived from plants for people with complicated gastrointestinal (“GI”) disease states. Jaguar family companies Napo and Napo Therapeutics, S.p.A., an Italian corporation Jaguar established in Milan, Italy in 2021, are focused on expanding global crofelemer access and are developing new therapies for orphan and rare GI conditions. Jaguar Animal Health is a Jaguar tradename. Magdalena Biosciences, a joint venture formed by Jaguar and Filament Health Corp., is focused on developing novel prescription medicines derived from plants for mental health indications. Jaguar Animal Health is a tradename the Company uses in the animal health space. In the animal health field, the Company focuses on developing and commercializing non-prescription GI products for companion and production animals.

Current wording

Jaguar Health, Inc. (“Jaguar”), in conjunction with Jaguar family company Napo Pharmaceuticals, Inc. (“Napo”), develops novel proprietary prescription drugs sustainably derived from plants for people with complicated gastrointestinal (“GI”) disease states. Jaguar family companies Napo and Napo Therapeutics, S.p.A., an Italian corporation Jaguar established in Milan, Italy in 2021, are focused on expanding global crofelemer access and are developing new therapies for orphan and rare GI conditions. Magdalena Biosciences, a joint venture formed by Jaguar and Filament Health Corp., is focused on developing novel prescription medicines derived from plants for mental health indications. Jaguar Animal Health is a tradename the Company uses in the animal health space. In the animal health field, the Company focuses on developing and commercializing non-prescription GI products for companion and production animals.

Previous wording

Napo’s crofelemer 125 mg delayed-release tablets (Mytesi) is an FDA-approved prescription drug for the symptomatic relief of noninfectious diarrhea in adults with HIV/AIDS on antiretroviral therapy. In January 2026, following Napo’s entry into a US licensing agreement with an affiliate of privately held Future Pak, LLC (“Future Pak”), Future Pak became the exclusive marketer for Mytesi as well as the tablet formulation for animal health, Canalevia-CA1, which is Jaguar’s crofelemer prescription drug for the treatment of chemotherapy-induced diarrhea in dogs. Jaguar was provided with $16.0 million of non-dilutive capital in January 2026 upon closing of the agreement with Future Pak, with an additional $2.0 million due to Jaguar upon completion of post-closing conditions. Per the terms of the agreement, Jaguar also has the opportunity to receive up to $20 million in milestone payments and other future payments. Jaguar will continue to manufacture crofelemer for Mytesi and Canalevia-CA1 for Future Pak. Mytesi and Canalevia-CA1 are both delayed-release tablet formulations of crofelemer.

Current wording

Napo’s crofelemer 125 mg delayed-release tablets (Mytesi) is an FDA-approved prescription drug for the symptomatic relief of noninfectious diarrhea in adults with HIV/AIDS on antiretroviral therapy. In January 2026, following Napo’s entry into a US commercial licensing agreement with an affiliate of privately held Future Pak, LLC (“Future Pak”), Future Pak became the exclusive US marketer for Mytesi as well as the tablet formulation for animal health, Canalevia-CA1, which is Jaguar’s crofelemer prescription drug for the treatment of chemotherapy-induced diarrhea in dogs. Jaguar was provided with $16.0 million of non-dilutive capital in January 2026 upon closing of the agreement with Future Pak, and satisfied the specified post-closing conditions required to receive payment of the non-dilutive $2.0 million holdback amount of the upfront fee from Future Pak. Per the terms of the agreement, Jaguar also has the opportunity to receive up to $17.0 million in additional milestone payments and other future payments. Jaguar will continue to manufacture crofelemer for Mytesi and Canalevia-CA1 for Future Pak. Mytesi and Canalevia-CA1 are both delayed-release tablet formulations of crofelemer.

Previous wording

In May 2025, Napo conducted a Type C Meeting with the Division of Gastroenterology at the FDA to discuss the responder analysis results of crofelemer in the cohort of breast cancer patients receiving targeted therapies with or without cytotoxic chemotherapy for prophylaxis of diarrhea from the company’s pivotal OnTarget Phase 3 clinical trial. OnTarget was a 24-week (two 12-week stages), randomized, multicenter, placebo-controlled, double-blind global study to evaluate the safety and efficacy of crofelemer in diarrhea prophylaxis in adult solid tumor patients receiving targeted therapies with or without standard chemotherapy. As previously announced, the top line results from the OnTarget study showed that the trial did not meet its primary endpoint for the prespecified analysis of all tumor types and all targeted therapies. As previously announced, in the prespecified subgroup of patients with breast cancer, crofelemer showed statistically significant improvement in the monthly responder analysis. Breast cancer patients represent one of the largest group of adult patients with solid tumors with patients often remaining on targeted therapy over prolonged periods in both adjuvant and metastatic settings.

Current wording

On May 2025, Napo conducted a Type C Meeting with the Division of Gastroenterology at the FDA to discuss the responder analysis results of crofelemer in the cohort of breast cancer patients receiving targeted therapies with or without cytotoxic chemotherapy for prophylaxis of diarrhea from the company’s pivotal OnTarget Phase 3 clinical trial. OnTarget was a 24-week (two 12-week stages), randomized, multicenter, placebo-controlled, double-blind global study to evaluate the safety and efficacy of crofelemer in diarrhea prophylaxis in adult solid tumor patients receiving targeted therapies with or without standard chemotherapy. As previously announced, the top line results from the OnTarget study showed that the trial did not meet its primary endpoint for the prespecified analysis of all tumor types and all targeted therapies. In the prespecified subgroup of patients with breast cancer, crofelemer showed statistically significant improvement in the monthly responder analysis. Breast cancer patients represent one of the largest group of adult patients with solid tumors with patients often remaining on targeted therapy over prolonged periods in both adjuvant and metastatic settings.

Previous wording

Napo also participated in an in-person Type C Meeting on May 28, 2025 with the Division of Gastroenterology of the FDA to discuss these statistically significant responder analysis results for adult patients with breast cancer in the OnTarget trial. Napo proposed two concurrent potential approaches during the meeting for potentially making crofelemer available to metastatic breast cancer patients with the significant unmet medical need of CTD: 1) proposed conduct of a pivotal treatment trial to facilitate approval of crofelemer for CTD in patients with metastatic breast cancer; and 2) the conduct of an expanded access program for treatment of breast cancer patients with CTD who may not be eligible for the planned phase 3 treatment trial, by including breast cancer patients in the adjuvant and neoadjuvant settings. The FDA formally acknowledged both of these key discussion points in correspondence to Napo, and Napo plans to submit a protocol to the FDA for a pivotal treatment trial for metastatic breast cancer patients using crofelemer.

Current wording

During the Type C Meeting in May 2025 with the Division of Gastroenterology of the FDA Napo discussed the statistically significant responder analysis results for adult patients with breast cancer in the OnTarget trial, and proposed two concurrent potential approaches during the meeting for potentially making crofelemer available to metastatic breast cancer patients with the significant unmet medical need of CTD: 1) proposed conduct of a pivotal treatment trial to facilitate approval of crofelemer for CTD in patients with metastatic breast cancer; and 2) the conduct of an expanded access program for treatment of breast cancer patients with CTD who may not be eligible for the planned phase 3 treatment trial, by including breast cancer patients in the adjuvant and neoadjuvant settings. The FDA formally acknowledged both of these key discussion points in correspondence to Napo, and Napo plans to submit a protocol to the FDA for a pivotal treatment trial for metastatic breast cancer patients using crofelemer.

Previous wording

In the second half of 2026, based on discussions with the FDA in May 2025, the company plans to submit to the FDA the final clinical study report (CSR) for the OnTarget trial together with additional details of the responder analysis in the cohort of breast cancer patients, along with a patient survey evaluating clinically meaningful reductions in the frequency of weekly loose/watery stools for patients metastatic cancer patients receiving targeted therapies with or without standard chemotherapy. The currently estimated US metastatic breast cancer population potentially also qualifies as an orphan population, in alignment with the Company’s core focus on orphan diseases. The Company therefore intends to request orphan drug designation from the FDA for the CTD indication in this population. Given crofelemer’s novel and paradigm-shifting physiological mechanism of action, the Company also plans to seek Fast Track designation from the FDA to support potentially expedited regulatory review and potential approval in the US for crofelemer for CTD in metastatic breast cancer patients.

Current wording

Based on discussions with the FDA in May 2025, the company plans to submit to the FDA the final clinical study report (CSR) for the OnTarget trial together with additional details of the responder analysis in the cohort of breast cancer patients, along with a patient survey evaluating clinically meaningful reductions in the frequency of weekly loose/watery stools for patients metastatic cancer patients receiving targeted therapies with or without standard chemotherapy.

Previous wording

Intestinal failure (IF) is a debilitating condition that often requires patients to receive life-sustaining fluids, electrolytes and nutrients through intravenous administration, which consists of total parenteral nutrition (TPN) with supplemental intravenous fluids, which together constitute parenteral support (PS). Many intestinal failure patients require PS up to 7 days a week, and sometimes for 20 hours or more per day. While crucial for IF patients, PS is associated with significant toxicities to patients, similar to some toxicities associated with chemotherapy, often causing serious health problems including infections, metabolic complications, and liver and kidney function problems. These symptoms may emerge at any time in intestinal failure patients and often become life-threatening.

Current wording

Intestinal failure (IF) is a debilitating condition that often requires patients to receive life-sustaining fluids, electrolytes and nutrients through intravenous administration, which consists of total parenteral nutrition (TPN) with supplemental intravenous fluids, which together constitute parenteral support (PS). Many intestinal failure patients require PS up to 7 days a week, and sometimes for 20 hours or more per day. While PS is supportive, palliative and life-sustaining, it is associated with serious complications including liver and kidney toxicities, and compromised cognitive functioning, and can have negative impact on growth and survival.

Previous wording

SBS affects approximately 10,000 to 20,000 people in the US, according to the Crohn’s & Colitis Foundation, and it is estimated that the population of SBS patients in Europe is approximately the same size, and the US population of SBS-IF patients was estimated at 12,000 patients in 2021 in a well-done epidemiology study. Despite limited treatment options, the global market for SBS was valued at $2 billion in 2024 and is projected to reach $6.4 billion by 2030, according to a report by ResearchAndMarkets.com. MVID is an ultrarare pediatric disease, with an estimated prevalence of a couple of hundred patients globally. Jaguar estimates that the global market size for MVID therapies is in the range of $50 million to $100 million, based on market research with key opinion leaders (KOLs) and payers.

Current wording

SBS affects approximately 10,000 to 20,000 people in the US, according to the Crohn’s & Colitis Foundation, and it is estimated that the population of SBS patients in Europe is approximately the same size, and the US population of SBS-IF patients was estimated at 12,000 patients in 2021 in a well-done epidemiology study. Despite limited treatment options, the global market for SBS is estimated to reach $7.93 billion by 2033, according to report by DataM Intelligence. MVID is an ultrarare pediatric disease, with an estimated prevalence of a couple of hundred patients globally. According to a third-party market research report, the value of the market for nutritional support for MVID is $856 million in 2026 in North America, Europe and the MENA (Middle East and North Africa) region combined, and estimated to exceed $1 billion in these markets as a whole by 2033.

Previous wording

Crofelemer was granted Orphan Drug Designation (“ODD”) by the FDA in February 2023 for MVID, an ultra-rare congenital diarrheal disorder (“CDD”), and granted ODD for MVID by the European Medicines Agency (“EMA”) in October 2022. Crofelemer was granted ODD for short bowel syndrome (“SBS”) by the EMA in December 2021 and by the FDA in August 2017. In August 2023, the FDA activated Napo’s Investigational New Drug (“IND”) application for a new crofelemer powder for oral solution formulation for the treatment of MVID.

Current wording

Crofelemer was granted Orphan Drug Designation (“ODD”) by the FDA in February 2023 for MVID, an ultrarare congenital diarrheal disorder (“CDD”), and granted ODD for MVID by the European Medicines Agency (“EMA”) in October 2022. Crofelemer was granted ODD for short bowel syndrome (“SBS”) by the EMA in December 2021 and by the FDA in August 2017. In August 2023, the FDA activated Napo’s Investigational New Drug (“IND”) application for a new crofelemer powder for oral solution formulation for the treatment of MVID.

Previous wording

Napo is also supporting an IIT in the US to evaluate crofelemer powder for oral solution for treatment of adult SBS-IF patients. The Company plans to pursue approval of crofelemer powder for oral solution for MVID in the US following the completion of the pivotal pediatric MVID trial. In accordance with the guidelines of specific EU countries, published data from such clinical investigations could support reimbursed early patient access to crofelemer for these debilitating IF conditions. Participation in early access programs, which do not exist in the US, provides an opportunity for reimbursement while impacting the morbidity and high cost of care for these chronic unmet needs. Additionally, the Company expects that if even just a very small number of MVID patients show benefit with crofelemer, this may potentially allow expedited pathways for regulatory approval in the US. Napo Therapeutics plans to pursue the opportunity for crofelemer powder for oral solution for PRIME designation, a European Medicines Agency (EMA) program providing enhanced interaction and early dialogue with drug developers of novel medicines targeting unmet medical needs. In the US, Napo plans to pursue Breakthrough Therapy Designation (BTD) from the FDA. If a drug is designated as breakthrough therapy, the FDA will expedite the review timeline for the drug.

Current wording

Napo is currently supporting multiple proof-of-concept (POC) investigator-initiated trials (IIT), and also conducting two pivotal clinical trials, of crofelemer powder for oral solution for MVID and SBS-IF in the US, European Union (EU), and/or Middle East. The Company’s trial to evaluate the safety and efficacy of crofelemer powder for oral solution in pediatric MVID patients is ongoing at multiple sites. Napo Therapeutics is conducting a Phase 2 study in adult SBS-IF patients at multiple clinical sites in Italy and Germany. An open label IIT is ongoing in pediatric IF patients with MVID and/or SBS in Abu Dhabi in the United Arab Emirates. As presented at the 58th Annual European Society for Pediatric Gastroenterology, Hepatology & Nutrition (ESPGHAN) Meeting in Lille, France in June 2026, the results of ongoing investigations of liquid oral crofelemer demonstrate substantial reductions of PS and PS normalized to body weight in pediatric IF patients dosed orally for more than one year, with no significant clinical or laboratory abnormalities. In one MVID patient, the weekly PS requirements normalized to body weight have been reduced by up to 48% following >12 months of liquid oral high-dose crofelemer therapy. In two pediatric SBS-IF patients, weekly PS requirements normalized to body weight were reduced up to 40% following >12 months of liquid oral high dose crofelemer therapy. Napo is also supporting an IIT in the US to evaluate crofelemer powder for oral solution for treatment of adult SBS-IF patients. The Company plans to pursue approval of crofelemer powder for oral solution for MVID in the US following the completion of the pivotal pediatric MVID trial. In accordance with the guidelines of specific EU countries, published data from such clinical investigations could support reimbursed early patient access to crofelemer for these debilitating IF conditions. Participation in early access programs, which do not exist in the US, provides an opportunity for reimbursement while impacting the morbidity and high cost of care for these chronic unmet needs. Additionally, the Company expects that if even just a very small number of MVID patients show benefit with crofelemer, this may potentially allow expedited pathways for regulatory approval in the US. In the US, Napo plans to pursue Breakthrough Therapy Designation (BTD) from the FDA. If a drug is designated as breakthrough therapy, the FDA will expedite the review timeline for the drug.

Previous wording

In January 2023, Jaguar and Filament Health, with funding from One Small Planet, formed the US-based joint venture Magdalena Biosciences (“Magdalena”). Magdalena’s focus is on the development of novel, natural prescription medicines derived from plants for mental health indications, including, initially, attention-deficit/hyperactivity disorder (“ADHD”) in adults. The goal of the collaboration is to extend the botanical drug development capabilities of Jaguar and Filament in order to develop pharmaceutical-grade, standardized drug candidates for mental health disorders and to partner with a potential future licensee to develop and commercialize these novel plant-based drugs. This venture aligns with Jaguar's Entheogen Therapeutics Initiative (ETI) and Filament’s corporate mission to develop novel, natural prescription medicines from plants. Magdalena is leveraging Jaguar’s proprietary medicinal plant library and Filament’s proprietary drug development technology. Jaguar’s library of 2,300 highly characterized medicinal plants and 3,500 plant extracts, all from firsthand ethnobotanical investigation by Jaguar and members of the ETI Scientific Strategy Team. Magdalena is currently approximately 40-percent owned by Jaguar.

Current wording

In January 2023, Jaguar and Filament Health, with funding from One Small Planet, formed the US-based joint venture Magdalena Biosciences (“Magdalena”). Magdalena’s focus is on the development of novel, natural prescription medicines derived from plants for mental health indications, including, initially, cognitive impairment associated with schizophrenia (CIAS). The goal of the collaboration is to extend the botanical drug development capabilities of Jaguar and Filament in order to develop pharmaceutical-grade, standardized drug candidates for mental health disorders and to partner with a potential future licensee to develop and commercialize these novel plant-based drugs. This venture aligns with Jaguar's Entheogen Therapeutics Initiative (ETI) and Filament’s corporate mission to develop novel, natural prescription medicines from plants. Magdalena is leveraging Jaguar’s proprietary medicinal plant library and Filament’s proprietary drug development technology. Jaguar’s library of 2,300 highly characterized medicinal plants and 3,500 plant extracts, all from firsthand ethnobotanical investigation by Jaguar and members of the ETI Scientific Strategy Team. Magdalena is currently approximately 40-percent owned by Jaguar.

Previous wording

In the field of animal health, Jaguar Animal Health is continuing limited activities related to developing first-in-class gastrointestinal products for dogs. In December 2021, the Company received conditional approval from the FDA to market Canalevia-CA1 (crofelemer delayed-release tablets) for the treatment of chemotherapy-induced diarrhea (CID) in dogs. The FDA conditionally approved Canalevia-CA1 under application number 141-552. Conditional approval allows for product commercialization while Jaguar Animal Health continues to collect the substantial evidence of effectiveness required for full approval. We have received a Minor Use in a Major Species (“MUMS”) designation from the FDA for Canalevia-CA1 to treat CID in dogs. FDA has established a "small number" threshold for minor use in each of the seven major species covered by the MUMS Act. The small number threshold is currently 80,000 for dogs, representing the largest number of dogs that can be affected by a disease or condition over the course of a year and still have the use qualify as a minor use.

Current wording

In the field of animal health, Jaguar Animal Health is continuing limited activities related to developing first-in-class gastrointestinal products for dogs. In December 2021, the Company received conditional approval from the FDA to market Canalevia-CA1 (crofelemer delayed-release tablets) for the treatment of chemotherapy-induced diarrhea (CID) in dogs. The FDA conditionally approved Canalevia-CA1 under application number 141-552.

Previous wording

Napo has actively ensured that its intellectual property (“IP”) filings in support of the development of crofelemer for various proposed indications are protected appropriately. The IP portfolio for crofelemer includes the relief and treatment of HIV-associated diarrhea and CID as well as planned indications for inflammatory diarrhea, IBS-D, CDD, and SBS, with all indications, Napo prioritizes IP protection. Napo currently holds approximately 195 patents, the majority of which do not expire until 2027-2031.

Current wording

Napo has actively ensured that its intellectual property (“IP”) filings in support of the development of crofelemer for various proposed indications are protected appropriately. The IP portfolio for crofelemer includes the relief and treatment of HIV-associated diarrhea and CID as well as planned indications for inflammatory diarrhea, IBS-D, CDD, and SBS, with all indications, Napo prioritizes IP protection. Napo currently holds approximately 185 patents, the majority of which do not expire until 2027-2031.

Previous wording

Napo and Napo Therapeutics remain focused on the development of crofelemer powder for solution for the rare disease indications of MVID and SBS-IF. Our management team has significant experience in gastrointestinal product development. We have assembled an impressive group of scientific advisory board (“SAB”) members who work closely with the Chair of Jaguar’s Scientific Advisory Board, Dr. Pravin Chaturvedi, who also serves as the Chief Scientific Officer (“CSO”) of Jaguar.

Current wording

Napo and Napo Therapeutics remain focused on the development of crofelemer powder for solution for the rare disease intestinal failure (IF) indications of MVID and SBS-IF. Our management team has significant experience in gastrointestinal product development. We have assembled an impressive group of scientific advisory board (“SAB”) members who work closely with the Chair of Napo’s and Jaguar’s Scientific Advisory Board, Dr. Pravin Chaturvedi, who also serves as the Chief Scientific Officer (“CSO”) of Napo and Jaguar.

Previous wording

On a consolidated basis, we have not yet generated enough revenue to date to achieve break-even or positive cash flows, and we expect to continue to incur significant research and development and other expenses. Our net income (losses) were $8.7 million net income and $10.6 million net losses for the three months ended March 31, 2026 and 2025, respectively. As of March 31, 2026, we had a total stockholders' deficit of $15.8 million, an accumulated deficit of $391.1 million, an accumulated other comprehensive loss of $1.2 million and cash of $7.3 million. We expect to continue to incur losses, and experience increased expenditures for the foreseeable future as we expand our product development activities, seek necessary approvals for our product candidates, conduct species-specific formulation studies for our non-prescription products, establish API manufacturing capabilities and begin additional commercialization activities. Payments of cash compensation to directors under the Director Compensation Program for the three months ended March 31, 2026, amounted to $109,000.

Current wording

On a consolidated basis, we have not yet generated enough revenue to date to achieve break-even or positive cash flows, and we expect to continue to incur significant research and development and other expenses. Our net income (losses) were $4.1 million net loss and $21.2 million net losses for the six months ended June 30, 2026 and 2025, respectively. As of June 30, 2026, we had a total stockholders' equity (deficit) of $4.9 million, an accumulated deficit of $403.7 million, an accumulated other comprehensive loss of $1.2 million and cash of $3.8 million. We expect to continue to incur losses, and experience increased expenditures for the foreseeable future as we expand our product development activities, seek necessary approvals for our product candidates, conduct species-specific formulation studies for our non-prescription products, establish API manufacturing capabilities and begin additional commercialization activities. Payments of cash compensation to directors under the Director Compensation Program for the three and six months ended June 30, 2026 amounted to $108,000 and $217,000, respectively.

Previous wording

Revenues from the sale of Mytesi and Canalevia, which are sold exclusively to Woodward pursuant to the Supply Agreement entered into on January 12, 2026. Under this arrangement, Napo manufactures or has the Mytesi Product manufactured and supplies it to the Licensee for commercialization in the U.S.

Current wording

Revenues from the sale of Mytesi and Canalevia, which are sold exclusively to Woodward Specialty LLC (“Woodward”), an affiliate of Future Pak, LLC (“Future Pak”), pursuant to the Supply Agreement entered into on January 12, 2026. Under this arrangement, Napo manufactures or has the Mytesi Product manufactured and supplies it to the Licensee for commercialization in the U.S.

Previous wording

Our policy typically permits returns if the product is damaged, defective, or otherwise cannot be used when received by the customer if the product has expired. Returns are accepted for product that will expire within six months or that have expired up to one year after their expiration dates. Estimates for expected returns of expired products are based primarily on an ongoing analysis of our historical return patterns.

Current wording

Our policy typically permits returns if the product is damaged, defective, or otherwise cannot be used when received by the customer if the product has expired. Returns are accepted for products that will expire within three months or that have expired up to one year after their expiration dates. Estimates for expected returns of expired products are based primarily on an ongoing analysis of our historical return patterns.

Previous wording

The cost of revenue consists of direct drug substance and drug product materials expenses, direct labor, distribution fees, royalties, and other related expenses associated with the sale of our products.

Current wording

The cost of product revenue consists of direct drug substance and drug product materials expenses, direct labor, distribution fees, royalties, and other related expenses associated with the sale of our products.

Previous wording

As of March 31, 2026, the Company has incurred approximately $25.0 million on its primary R&D projects. The timing and amount of our research and development expenses will depend largely upon the outcomes of current and future trials for our prescription drug product candidates, as well as the related regulatory requirements, the outcomes of current and future species-specific formulation studies for our non-prescription products, manufacturing costs and any costs associated with the advancement of our line extension programs. We cannot determine with certainty the duration and completion costs of the current or future development activities. The total project costs remain uncertain due to regulatory and clinical trial complexities. Management continues to monitor timelines closely to address any risks that could impact timely project completion and future operations.

Current wording

The Company has incurred approximately $25.0 million of expenses for its primary R&D projects from the inception of the projects until June 30, 2026. The timing and amount of our research and development expenses will depend largely upon the outcomes of current and future trials for our prescription drug product candidates, as well as the related regulatory requirements, the outcomes of current and future species-specific formulation studies for our non-prescription products, manufacturing costs and any costs associated with the advancement of our line extension programs. We cannot determine with certainty the duration and completion costs of the current or future development activities. The total project costs remain uncertain due to regulatory and clinical trial complexities. Management continues to monitor timelines closely to address any risks that could impact timely project completion and future operations.

Previous wording

Research and development expenses decreased following the completion of the in-life portion of the Phase 3 OnTarget Trial in first half of 2025. During the second half of 2026, the Company will submit clinical study report (CSR) and new protocols for the additional phase 3 clinical trial of crofelemer delayed-release tablets for the treatment of diarrhea in adult patients with metastatic breast cancer. Following FDA clearance for this new study in metastatic breast cancer patients, the costs associated with the clinical trial conduct will incur in the succeeding months in 2026.

Current wording

Research and development expenses decreased following the completion of the in-life portion of the Phase 3 OnTarget Trial in first half of 2025. During the second half of 2026, the Company will submit clinical study report (CSR).

Previous wording

Sales and marketing expenses consist of personnel and related benefits, stock-based compensation, direct sales and marketing, employee travel, and management consulting expenses. We currently incur sales and marketing expenses to promote Mytesi and Gelclair. We do not have significant marketing or promotional expenses related to Canalevia-CA1 and Neonorm Calf or Neonorm Foal for the three months ended March 31, 2026 and 2025.

Current wording

Sales and marketing expenses consist of personnel and related benefits, stock-based compensation, direct sales and marketing, employee travel, and management consulting expenses. We currently incur sales and marketing expenses to promote Mytesi and Gelclair. We do not have significant marketing or promotional expenses related to Canalevia-CA1 and Neonorm Calf or Neonorm Foal for the six months ended June 30, 2026 and 2025.

Previous wording

On January 12, 2026, Napo and the Company entered into a license agreement with Woodward Specialty LLC (“Woodward”), an affiliate of Future Pak, LLC (“Future Pak”), and Future Pak, pursuant to which, Napo granted to Woodward an exclusive, nontransferable, sublicensable, royalty-free right and license (subject to certain exceptions as set forth in the License Agreement) under the Napo Mytesi Patents (as defined in the License Agreement) to sell, offer for sale, have sold, make, have made, promote, distribute and otherwise commercialize the Mytesi Product and the Canalevia Product. Thus, we expect no sales and marketing expenses for these products going forward.

Current wording

On January 12, 2026, Napo and the Company entered into a license agreement with Woodward and Future Pak, pursuant to which, Napo granted to Woodward an exclusive, nontransferable, sublicensable, royalty-free right and license (subject to certain exceptions as set forth in the License Agreement) under the Napo Mytesi Patents (as defined in the License Agreement) to sell, offer for sale, have sold, make, have made, promote, distribute and otherwise commercialize the Mytesi Product and the Canalevia Product. Thus, we expect no sales and marketing expenses for these products going forward.

Previous wording

In the near term, we expect general and administrative expense to decrease as we focus on our pipeline development and market access expansion on our Intestinal Failure (IF) programs.

Current wording

In the near term, we expect general and administrative expenses to decrease as we focus on our pipeline development and market access expansion on our Intestinal Failure (IF) programs.

Previous wording

Change in fair value of freestanding and hybrid financial instruments designated at Fair Value Option consists of gain or loss recognized related to fair values changes of our instruments designated at FVO.

Current wording

Change in fair value of freestanding and hybrid financial instruments designated at fair value option ("FVO") consists of gain or loss recognized related to fair values changes of our instruments designated at FVO.

Previous wording

For the three months ended March 31, 2026, the only material impacts of IRA are a significant reduction in the Company’s Medicare Part D rebates payable to CMS and a reduction in patients’ out-of-pocket copays for their Mytesi prescriptions. Management continues to assess the evolving implications of the IRA on pricing, reimbursement, and research incentives.

Current wording

For the three and six months ended June 30, 2026, the only material impacts of IRA are a significant reduction in the Company’s Medicare Part D rebates payable to CMS and a reduction in patients’ out-of-pocket copays for their Mytesi prescriptions. Management continues to assess the evolving implications of the IRA on pricing, reimbursement, and research incentives.

Previous wording

The following table summarizes the Company’s results of operations with respect to the items set forth in such table for the three months ended March 31, 2026 and 2025, together with the change in such items in dollars and as a percentage.

Current wording

The following table summarizes the Company’s results of operations with respect to the items set forth in such table for the six months ended June 30, 2026 and 2025, together with the change in such items in dollars and as a percentage.

Previous wording

Due to the Company’s arrangements, including elements of variable consideration, gross product sales are reduced in order to reflect the expected consideration to arrive at net product sales. Deductions to reduce gross product sales to net product sales for the three months ended March 31, 2026 and 2025, were as follows:

Current wording

Due to the Company’s arrangements, including elements of variable consideration, gross product sales are reduced in order to reflect the expected consideration to arrive at net product sales. Deductions to reduce gross product sales to net product sales for the six months ended June 30, 2026 and 2025, were as follows:

Previous wording

Sales discounts were $24,000 and $260,000 for the three months ended March 31, 2026 and 2025, respectively, a decrease of $236,000 due to changes in sales discount arrangements to various customers.

Current wording

Sales discounts were $24,000 and $566,000 for the six months ended June 30, 2026 and 2025, respectively, a decrease of $542,000 due to changes in sales discount arrangements to various customers.

Previous wording

License revenues increased by $19.0 million from $43,000 for the three months ended March 31, 2025 to $19.0 million in the same period in 2026, due to license agreement entered by the Company with Woodward on January 12, 2026. The license revenue is recognized as Woodward receives and consumes the benefits from the Company’s performance of providing access to its intellectual property at point in time.

Current wording

License revenues increased by $19.0 million from $86,000 for the six months ended June 30, 2025 to $19.0 million in the same period in 2026, due to license agreement entered by the Company with Woodward. The license revenue is recognized at a point in time when control of the underlying functional intellectual property is transferred, permitting Woodward to use and benefit from the license.

Previous wording

Clinical and contract manufacturing expenses increased by $838,000 from $1.3 million for the three months ended March 31, 2025 to $2.1 million in the same period in 2026. The increase was primarily attributable to the progression of crofelemer lyophilization into the development phase, which resulted in higher clinical trial–related costs and increased external contract manufacturing services related to lyophilization activities.

Current wording

Clinical and contract manufacturing expenses increased by $1.6 million from $2.3 million for the six months ended June 30, 2025 to $4.0 million in the same period in 2026. The increase was primarily attributable to the progression of crofelemer lyophilization into the development phase, which resulted in higher clinical trial–related costs and increased external contract manufacturing services related to lyophilization activities.

Previous wording

Stock-based compensation expense decreased by $60,000 from $117,000 for the three months ended March 31, 2025 to $57,000 in the same period in 2026, due to higher RSU cancellations and decline in fair value of newly granted options, despite the increase in higher options and RSUs granted during the current year.

Current wording

Stock-based compensation expense decreased by $93,000 from $209,000 for the six months ended June 30, 2025 to $116,000 in the same period in 2026, due to reduction in headcount of employees subject to the stock-based compensation program, reduction of awards granted, and decline in fair value of newly granted options.

Previous wording

SBS-IF clinical trial expenses decreased by $216,000 from $327,000 for the three months ended March 31, 2025 to $111,000 in the same period in 2026, due to a strategic shift in research priorities, as the company is currently focusing on MVID.

Current wording

SBS-IF clinical trial expenses decreased by $559,000 from $670,000 for the six months ended June 30, 2025 to $111,000 in the same period in 2026, due to a strategic shift in research priorities, as the company is currently focusing on MVID.

Previous wording

CTD clinical trial expenses decreased by $370,000 from $497,000 for the three months ended March 31, 2025 to $127,000 in the same period in 2026, due to the winding down of the statistically significant Breast Cancer clinical trial, following the FDA-recommended additional one-year study period.

Current wording

CTD clinical trial expenses decreased by $444,000 from $506,000 for the six months ended June 30, 2025 to $62,000 in the same period in 2026, due to the winding down of the statistically significant Breast Cancer clinical trial, following the FDA-recommended additional one-year study period.

Previous wording

Third-party consulting services decreased by $304,000 from $309,000 for the three months ended March 31, 2025, to $5,000 in the same period in 2026, due to a reduction in sales and marketing activities for Mytesi and Canalevia following the licensing agreement with Woodward (affiliate of Future Pak), which led to a decrease in third-party consulting services.

Current wording

Third-party consulting services decreased by $366,000 from $371,000 for the six months ended June 30, 2025, to $5,000 in the same period in 2026, due to a reduction in sales and marketing activities for Mytesi and Canalevia following the licensing agreement with Woodward, which led to a decrease in third-party consulting services.

Previous wording

Legal services decreased by $420,000 from $1.1 million for the three months ended March 31, 2025, to $678,000 in the same period in 2026, due to lower legal fees, decreased legal consultations for contracts and agreements and other regulatory filings.

Current wording

Legal services decreased by $361,000 from $2.1 million for the six months ended June 30, 2025, to $1.7 million in the same period in 2026, due to lower legal fees and reduced consultations for contracts and regulatory filings, as well as fewer financing activities compared to the prior period, which included borrowing of convertible notes and issuance of common stock to HCW investors.

Previous wording

Stock-based compensation decreased by $57,000 from $166,000 for the three months ended March 31, 2025, to $109,000 in the same period in 2026, due to higher RSU cancellations and decline in fair value of newly granted options, despite the increase in higher options and RSUs granted during the current year.

Current wording

Stock-based compensation decreased by $96,000 from $317,000 for the six months ended June 30, 2025, to $221,000 in the same period in 2026, due to reduction in headcount of employees subject to the stock-based compensation program, reduction of awards granted, and decline in fair value of newly granted options.

Previous wording

Comparison for the three months ended March 31, 2026 and 2025

Current wording

Comparison for the three months ended June 30, 2026

Previous wording

Our gross product revenues were approximately $1.3 million and $3.2 million for the three months ended March 31, 2026 and 2025, respectively. These figures reflect revenue from the sale of our human drug Mytesi, our animal products branded as Neonorm Calf and Neonorm Foal and exclusive distribution agreement for the sale of Gelclair.

Current wording

Our gross product revenues were approximately $1.2 million and $3.9 million for the three months ended June 30, 2026 and 2025, respectively. These figures reflect revenue from the sale of our human drug Mytesi, our animal products branded as Neonorm Calf and Neonorm Foal and exclusive distribution agreement for the sale of Gelclair.

Previous wording

The decrease in gross product revenue of $1.9 million for three months ended March 31, 2026 compared to the same period in 2025, was primarily due to the decrease in sales volume of Mytesi.

Current wording

The decrease in gross product revenue of $2.7 million for three months ended June 30, 2026 compared to the same period in 2025, was primarily due to the decrease in sales volume of Mytesi.

Previous wording

Medicaid and AIDS Drug Assistance Program (“ADAP”) rebates were $64,000 and $735,000 for the three months ended March 31, 2026 and 2025, respectively, a decrease of $671,000 due to lower product utilization within the program coupled with changes in rebate agreements.

Current wording

Medicaid and AIDS Drug Assistance Program (“ADAP”) rebates were $0 and $656,000 for the three months ended June 30, 2026 and 2025, respectively, a decrease of $656,000 due to lower product utilization within the program coupled with changes in rebate agreements and the license agreement entered by the Company with Woodward.

Previous wording

Sales returns were $0 and $17,000 for the three months ended March 31, 2026 and 2025, respectively, a decrease of $17,000 due to the decrease in volume of sales returns.

Current wording

Sales returns were $0 and $4,000 for the three months ended June 30, 2026 and 2025, respectively, a decrease of $4,000 due to the decrease in volume of sales returns.