Seaport Therapeutics, Inc.

Sources of Liquidity

Since our inception, we have incurred significant operating losses. During the nine months ended September 30, 2026 and 2025, we had a net loss of $114.4 million and $50.7 million, respectively. As of September 30, 2026, we had an accumulated deficit of $228.5 million. We have not generated any revenue from product sales and we do not expect to generate revenue from sales of products in the near term, if at all. We expect to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates into and through clinical development and as we continue to develop additional product candidates. As such, we expect our research and development and general and administrative costs to continue to increase significantly, including the costs associated with operating as a public company.

To date we have funded our operations with the aggregate gross proceeds of $326.1 million from the Series A and Series B Financings and aggregate net proceeds of $238.4 million from the sale of shares of common stock in our IPO, after deducting underwriting discounts, commissions and other offering expenses. As of September 30, 2026, we had cash, cash equivalents and investments of $403.8 million. Based on our current operating plans, we believe that our existing cash, cash equivalents and investments will be sufficient to fund our operating expenses and capital expenditure requirements into 2029.

Cash Flows

The following table provides information regarding our cash flows for the periods presented (in thousands):

(1)

Our balance sheet is affected by spot exchange rates used to translate local currency amounts into U.S. dollars. In accordance with U.S. GAAP, we have eliminated the effect of foreign currency throughout our cash flow statement, except for its effect on our cash and cash equivalents.

Net Cash Used in Operating Activities

Net cash used in operating activities was $69.0 million for the nine months ended September 30, 2026 and $51.3 million for the nine months ended September 30, 2025. Cash used in operating activities increased by $17.7 million due to an increase in our operating expenses for the nine months ended September 30, 2026, offset by changes in operating assets and liabilities including an increase in our accounts payable balance due to timing of payments.

Net Cash Used in Investing Activities

Net cash used in investing activities was $155.5 million for the nine months ended September 30, 2026, compared to $211.9 million for the nine months ended September 30, 2025. Cash used in investing activities decreased by $56.4 million, driven by lower purchases of U.S. Treasury securities for the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025, primarily due to the timing of when cash was invested from our related financings. The cash flows from the purchases of U.S. Treasury securities were offset by an increase in the cash flows provided from the maturities of our investments for the nine months ended September 30, 2026 as compared to nine months ended September 30, 2025, the proceeds of which were used to fund operations.

Net Cash Provided by Financing Activities

Net cash provided by financing activities was $240.0 million for the nine months ended September 30, 2026, primarily consisting of net proceeds from our IPO. Cash flows from financing activities for the nine months ended September 30, 2025 were de minimis.

Future Funding Requirements

As of September 30, 2026, we had cash, cash equivalents and investments of $403.8 million. Based upon our current operating plans, we believe our cash, cash equivalents and investments as of September 30, 2026, will be sufficient to fund our operations into 2029. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect.

Due to the inherently unpredictable nature of nonclinical and clinical development and given the early stage of our programs and product candidates, we cannot reasonably estimate the costs we will incur and the timelines that will be required to complete development, obtain any marketing approval, and commercialize our products, if and when approved. For the same reasons, we are also unable to predict when, if ever, we will generate revenue from product sales or whether, or when, if ever, we may achieve profitability. Clinical and nonclinical development timelines, the probability of success, and development costs can differ materially from expectations. In addition, we cannot forecast which products, if approved, 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. We will need to raise substantial additional capital in the future.

Our primary uses of capital are to fund research and development activities, compensation and related expenses, and general overhead costs. We expect our expenses to increase substantially in connection with our ongoing activities, particularly as we advance our current and future product candidates through discovery, nonclinical studies, and clinical trials.

Our funding requirements and timing and amount of our operating expenditures will depend on many factors, including:

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the scope, timing, progress, costs, and results of discovery, nonclinical development and clinical trials for our current or future product candidates and effectiveness of our Glyph platform;

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the number of clinical trials required for regulatory approval of our current or future product candidates;

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the costs, timing, and outcome of regulatory review of any of our current or future product candidates;

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the costs associated with acquiring or licensing additional product candidates, technologies or assets, including the timing and amount of any milestones, royalties, or other payments due in connection with our acquisitions and licenses, as applicable;

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the cost of manufacturing clinical and commercial supplies of our current or future product candidates;

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the costs and timing of preparing, filing, and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims, including any claims by third parties that we are infringing upon their intellectual property rights;

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our ability to maintain existing, and establish new, strategic collaborations or other arrangements and the financial terms of any such agreements, including the timing and amount of any future milestone, royalty or other payments due under any such agreement;

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the costs and timing of future commercialization activities, including manufacturing, marketing, sales, and distribution, for any of our product candidates for which we receive marketing approval;

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the revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval;

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expenses to attract, hire, and retain skilled personnel;

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the costs of operating as a public company;

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our ability to establish a commercially viable pricing structure and obtain approval for coverage and adequate reimbursement from third-party and government payors;

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the effect of macroeconomic trends including inflation, tariffs, and fluctuating interest rates;

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addressing any potential supply chain interruptions or delays;

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the effect of competing technological and market developments; and

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the extent to which we acquire or invest in businesses, products, and technologies.

Until such time, if ever, that we can generate substantial product revenue, we expect to finance our operations through a combination of public and private equity offerings, debt and royalty financings, or other sources of capital, which may include additional collaborations with other companies, or licensing arrangements with third parties, or other similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders will or could be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt or royalty financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making acquisitions or capital expenditures, or declaring dividends. If we raise additional funds through additional collaborations, strategic alliances, or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, product candidates, or grant licenses on terms that may not be favorable to us. If we are unable to raise additional capital or obtain adequate funding when needed or on acceptable terms, we may be required to delay, scale back, or discontinue our research, product development, or future commercialization efforts, or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Contractual Obligations and Commitments

Asset Transfer Agreement with PureTech

We were incorporated in April 2024 by PureTech LYT, as our sole stockholder, and upon formation issued 318 shares of our common stock to PureTech LYT. In April 2024, we entered into an Asset Transfer Agreement, or the Asset Transfer Agreement, with PureTech Health LLC, or PureTech Health and PureTech LYT Inc., or PureTech LYT, pursuant to which PureTech Health and PureTech LYT agreed to contribute, convey, assign, transfer, and deliver to us all of PureTech Health's and PureTech LYT’s right, title, and interest in, to, and under the assets related to its Glyph™ technology or products, including a license agreement with Monash University, as amended and restated, or the Monash License Agreement, subject to the terms set forth in the Asset Transfer Agreement. In exchange, we issued 40,000,000 shares of our Series A-1 convertible preferred stock and 302,161 shares of our common stock to PureTech LYT.

In connection with the Asset Transfer Agreement, we have agreed to make milestone payments of up to an aggregate of $10.0 million for the first product covered by assets transferred through the Asset Transfer Agreement, or the Seaport Glyph Product, of $2.0 million for the first patient dosed in the first phase 3 clinical trial, $4.0 million for the first commercial sale in the United States, $2.0 million for the first commercial sale in a major European market, and $2.0 million for the first commercial sale in Japan, and for each subsequent Seaport Glyph Product, we have agreed to make milestone payments of $1.0 million for the first patient dosed in the first phase 3 clinical trial, $2.0 million for the first commercial sale in the United States, $1.0 million for the first commercial sale in a major European market, and $1.0 million for the first commercial sale in Japan. In addition, we are obligated to pay royalties between 3% and 5% on the annual net sales of each Seaport Glyph Product as follows: less than $500 million: 3%; $500 million to $1 billion: 3.5%; $1 billion to $2.5 billion: 4%; $2.5 billion to $3.5 billion: 4.5%; $3.5 billion or greater: 5% and a percentage of net income generated by us from third parties on any products licensed under the Glyph intellectual property which was transferred to us as part of the Asset Transfer Agreement. The royalty term will expire on a country-by-country basis as to each Seaport Glyph Product on the later of the ten year anniversary of the first commercial sale of such Seaport Glyph Product in such country or the date on which the last valid claim of patent rights of such Seaport Glyph Product expires in such country.

Monash License Agreement

Under the Monash License Agreement, we have agreed to use reasonable commercial endeavors to (i) develop at least one Licensed Product, (ii) seek regulatory approval for at least one Licensed Product, and (iii) after receipt of such regulatory approval in the United States or Europe, promote and develop the sale of at least one Licensed Product in such territory. Monash University agrees to provide reasonable technical assistance and advice based on Monash University’s know-how relating to the technology licensed under the Monash License Agreement.

As consideration for the licenses granted by Monash University, we are required to pay Monash University: (i) low-single digit royalties with a rate based on net sales per calendar year (subject to certain reductions); (ii) a low-double digit percentage (within the range of 5-15%) of any net income received under a sublicense (subject to a license payment stacking reduction) with the percentage varying based on the development stage of the licensed products at the time the sublicense is granted during the term of the Monash License Agreement; (iii) an agreed upon research funding amount to progress mutually agreed research and development or commercialization activities; (iv) a mid-five-figure annual maintenance fee during the term of the agreement commencing on the third anniversary of the execution date of the Original License Agreement until the first commercial sale of a Licensed Product creditable against net income sharing, royalties, and milestone payments; (v) milestone payments in the event of successful development milestones of up to $1.075 million per Licensed Product for the first three Licensed Products; and (vi) milestone payments in the event of successful commercial milestones of up to $7.25 million per Licensed Product for the first three Licensed Products. We are also obligated to (a) pay all costs incurred for the prosecution and maintenance of the Licensed Patents and patent filings stemming from collaboration activities and (b) reimburse Monash University for all patent prosecution costs of the Licensed Patents prior to the execution date of the Original License Agreement.

The Monash License Agreement commenced on the execution date of the Original License Agreement and will expire seven years after the last of the Licensed Patents expires, unless terminated earlier. Either party may terminate for due cause, including for material breach and bankruptcy. Monash University may terminate if we fail to meet our diligence requirements. Either party may terminate the Monash License Agreement if we determine that the activities are no longer commercially viable.

As of September 30, 2026, the first two development milestones under the Monash License Agreement, totaling $0.2 million, had been achieved and were paid by PureTech, as they occurred prior to our formation. We have since paid the third development milestone of $0.1 million, as well as annual maintenance fees. No other milestone payments have become due or been paid under the Monash License Agreement as of September 30, 2026.

Purchase and Other Obligations

We enter into contracts in the normal course of business with contract research organizations, or CROs, and other third-party vendors for nonclinical and commercial supply manufacturing, support for pre-commercial activities, research, and development activities, and other services and products for our operations. These contracts are generally cancelable upon written notice. Payments due upon cancellation consist generally of payments for services provided and expenses incurred up to the date of cancellation.

Lease Obligations

In October 2024, we entered into a lease agreement with a third party for our corporate office space located in Boston, Massachusetts. The lease commenced in December 2024 and has an initial term of approximately six years, expiring in October 2030. The aggregate payments under the full lease total approximately $6.1 million, which will be recognized over the term of the lease.

In December 2024, we entered into a laboratory lease with a third party for lab space located in Boston, Massachusetts. The lease commenced in January 2025 and was for an initial term of 24 months from the commencement date. The aggregate payments under the lease total approximately $1.2 million. In March 2026, we exercised our option to extend the lease for an additional 12 months. The modification resulted in an increase in the aggregate payments under the lease of approximately $0.6 million.

For additional information on our contractual obligation and commitments please see Note 8—License and Collaboration Agreements and Note 14—Commitments and Contingencies.