Kalaris Therapeutics, Inc.

Previous wording

We are currently conducting a Phase 1b/2 multiple ascending dose clinical trial of TH103 in patients with nAMD, which is intended to build upon our Phase 1a single ascending dose clinical trial. The Phase 1b/2 dose-finding trial is designed to evaluate multiple dose levels of TH103 in up to 80 nAMD patients. In the trial, patients are expected to receive up to four monthly loading doses of intravitreally administered TH103 at a range of dose levels. Assessments are expected to include safety and preliminary efficacy with a primary time point for analysis at one month following the last TH103 injection. Patients will then be followed in an extension phase of the study. Following the implementation of additional manufacturing process refinements, patients in the Phase 1b/2 multiple ascending dose study are now receiving new batches of clinical trial material with lower levels of impurities. We expect to report preliminary data from the Phase 1b/2 clinical trial in the first half of 2027.

Current wording

We are currently conducting a Phase 1b/2 multiple ascending dose clinical trial of TH103 in patients with nAMD, which is intended to build upon our Phase 1a single ascending dose clinical trial. The Phase 1b/2 dose-finding trial is designed to evaluate multiple dose levels of TH103 in approximately 60 to 80 nAMD patients, and patient enrollment and dosing is ongoing. In the trial, patients are expected to receive up to four monthly loading doses of intravitreally administered TH103 at a range of dose levels. Assessments are expected to include safety and preliminary efficacy with a primary time point for analysis at one month following the last TH103 injection. Patients will then be followed in an extension phase of the study. In the third quarter of 2026, the pilot manufacturer for clinical supply of TH103 produced a batch of TH103 that did not meet the applicable release specification for aggregation due to a batch-specific operational issue. A new batch of material is now expected in the second quarter of 2027. As a result of this supply interruption, data from the Phase 1b/2 study is now expected in the second half of 2027, including durability data from initial patient cohorts.

Previous wording

Assuming successful completion of the ongoing Phase 1b/2 clinical trial of TH103, and subject to the favorable results from such trial and discussions with regulators, we intend to initiate Phase 3 clinical trials of TH103 for nAMD by year-end 2027. We also plan to expand the development of TH103 beyond nAMD into other prevalent VEGF-mediated retinal diseases, such as Diabetic Macular Edema (“DME”), diabetic retinopathy (“DR”), and Retinal Vein Occlusion.

Current wording

We now intend to initiate Phase 3 clinical trials of TH103 for nAMD in 2028, subject to discussions with regulators and the generation of sufficient data in the ongoing Phase 1b/2 trial to support further development and selection of a Phase 3 dose. We also plan to expand the development of TH103 beyond nAMD into other prevalent VEGF-mediated retinal diseases, such as Diabetic Macular Edema (“DME”), diabetic retinopathy (“DR”), and Retinal Vein Occlusion.

Previous wording

Since our inception in September 2019, we have devoted substantially all of our resources to organizing and staffing, business planning, raising capital, acquiring technology, establishing our intellectual property portfolio and performing research and development of our product candidate. We do not have any products approved for sale and have not generated any revenue from product sales or otherwise. We have incurred significant losses and negative cash flows from operations since our inception. Our net losses were $22.4 million and $21.5 million for the six months ended June 30, 2026 and 2025, respectively. Our negative cash flows from operations were $22.6 million and $20.0 million for the six months ended June 30, 2026 and 2025, respectively. As of June 30, 2026, we had an accumulated deficit of $182.4 million. To date, we have funded our operations primarily from sales of our redeemable convertible preferred stock, issuances of convertible promissory notes and a simple agreement for future equity (“SAFE”), from cash and cash equivalents of AlloVir, Inc. (“AlloVir”) received in the Merger (as defined below), and from proceeds from the 2025 Private Placement (as defined below).

Current wording

Since our inception in September 2019, we have devoted substantially all of our resources to organizing and staffing, business planning, raising capital, acquiring technology, establishing our intellectual property portfolio and performing research and development of our product candidate. We do not have any products approved for sale and have not generated any revenue from product sales or otherwise. We have incurred significant losses and negative cash flows from operations since our inception. Our net losses were $33.4 million and $33.4 million for the nine months ended September 30, 2026 and 2025, respectively. Our negative cash flows from operations were $33.2 million and $31.3 million for the nine months ended September 30, 2026 and 2025, respectively. As of September 30, 2026, we had an accumulated deficit of $193.4 million. To date, we have funded our operations primarily from sales of our redeemable convertible preferred stock, issuances of convertible promissory notes and a simple agreement for future equity (“SAFE”), from cash and cash equivalents of AlloVir, Inc. (“AlloVir”) received in the Merger (as defined below), and from proceeds from the 2025 Private Placement (as defined below).

Previous wording

As of June 30, 2026, we had $93.5 million in cash, cash equivalents and marketable securities. Based on our current operating plans, our management expects that our cash, cash equivalents and marketable securities will be sufficient to fund our operating expenses and capital expenditure requirements into the fourth quarter of 2027. However, management has based these estimates on assumptions that may prove to be wrong, and our operating plans may change as a result of many factors currently unknown to us. In addition, changing circumstances could cause us to consume capital significantly faster than we currently anticipate, and we may need to spend more than currently expected because of circumstances beyond our control. As a result, we could deplete our capital resources sooner than we currently expect.

Current wording

As of September 30, 2026, we had $82.9 million in cash, cash equivalents and marketable securities. Based on our current operating plans, our management expects that our cash, cash equivalents and marketable securities will be sufficient to fund our operating expenses and capital expenditure requirements into 2028. However, management has based these estimates on assumptions that may prove to be wrong, and our operating plans may change as a result of many factors currently unknown to us. In addition, changing circumstances could cause us to consume capital significantly faster than we currently anticipate, and we may need to spend more than currently expected because of circumstances beyond our control. As a result, we could deplete our capital resources sooner than we currently expect.

Previous wording

Patent reimbursement costs were immaterial for the three and six months ended June 30, 2026. We recognized an immaterial amount and $0.1 million in patent reimbursement costs for the three and six months ended June 30, 2025, respectively. We made a payment of $0.1 million in connection with our achievement of the first development milestone related to the dosing of the first patient in our Phase 1a clinical trial in August 2024. No other milestones were achieved or probable through June 30, 2026 and, therefore, for the three and six months ended June 30, 2026, no milestone expense was recognized.

Current wording

We recognized $0.1 million in patent reimbursement costs for each of the three and nine months ended September 30, 2026. We recognized $0.1 million and $0.2 million in patent reimbursement costs for the three and nine months ended September 30, 2025, respectively. We made a payment of $0.1 million in connection with our achievement of the first development milestone related to the dosing of the first patient in our Phase 1a clinical trial in August 2024. No other milestones were achieved or probable through September 30, 2026 and, therefore, for the three and nine months ended September 30, 2026 and 2025, no milestone expense was recognized.

Previous wording

Once royalty payments to Samsara are deemed probable and estimable, and if such amounts exceed the initially recorded royalty obligation balance, we will impute interest to accrete the liability on a prospective basis based on such estimates. If and when we make royalty payments under the Royalty Agreement, the royalty obligation balance will be reduced. As of June 30, 2026, royalty payments were not probable and estimable and, therefore, for the three and six months ended June 30, 2026, no interest expense was recognized for the royalty liability.

Current wording

Once royalty payments to Samsara are deemed probable and estimable, and if such amounts exceed the initially recorded royalty obligation balance, we will impute interest to accrete the liability on a prospective basis based on such estimates. If and when we make royalty payments under the Royalty Agreement, the royalty obligation balance will be reduced. As of September 30, 2026, royalty payments were not probable and estimable and, therefore, for the three and nine months ended September 30, 2026 and 2025, no interest expense was recognized for the royalty liability.

Previous wording

CDMO, CRO and other third-party clinical trials and consulting costs increased by $0.5 million. This was primarily driven by an increase of $1.5 million in CRO and other clinical expenses as we opened additional investigational sites and enrolled patients in our clinical program, offset by a decrease of $1.0 million in CDMO manufacturing and process development activities.

Current wording

CDMO, CRO and other third-party clinical trials and consulting costs decreased by $0.9 million. This was primarily driven by a decrease of $1.5 million in CDMO manufacturing and process development activities, offset by an increase of $0.6 million in CRO and other clinical expenses as we opened additional investigational sites and enrolled patients in our clinical program.

Previous wording

Personnel related costs (including stock-based compensation) increased by $0.3 million due to hiring in our research and development organization to support our clinical trials and manufacturing.

Current wording

Personnel related costs (including stock-based compensation) increased by $0.2 million due to hiring in our research and development organization to support our clinical trials and manufacturing.

Previous wording

General and administrative expenses decreased by $0.4 million from $3.8 million for the three months ended June 30, 2025 to $3.4 million for the three months ended June 30, 2026. The decrease in general and administrative expenses was primarily attributable to a decrease of $0.3 million in legal, accounting and other professional fees.

Current wording

General and administrative expenses decreased by $0.1 million from $3.6 million for the three months ended September 30, 2025 to $3.5 million for the three months ended September 30, 2026. The decrease in general and administrative expenses was primarily attributable to a decrease of $0.3 million in professional services, consulting and other general and administrative expenses, offset by an increase of $0.2 million in personnel related costs (including stock-based compensation).

Previous wording

Other income, net was $0.9 million for each of the three months ended June 30, 2026 and 2025 primarily consisted of interest income received from money market funds and U.S. government treasury securities.

Current wording

Other income, net was $0.8 million for each of the three months ended September 30, 2026 and 2025, which primarily consisted of interest income received from money market funds and U.S. government treasury securities.

Previous wording

Research and development expenses increased by $0.6 million, from $8.4 million for the three months ended June 30, 2025, to $9.0 million for the three months ended June 30, 2026.

Current wording

Research and development expenses increased by $1.3 million, from $23.6 million for the nine months ended September 30, 2025, to $24.9 million for the nine months ended September 30, 2026.

Previous wording

CDMO, CRO and other third-party clinical trials and consulting costs increased by $1.9 million. This was primarily driven by an increase of $3.3 million in CRO and other clinical expenses as we opened additional investigational sites and enrolled patients in our clinical program, offset by a decrease of $ 1.5 million in CDMO manufacturing and process development activities.

Current wording

CDMO, CRO and other third-party clinical trials and consulting costs increased by $1.0 million. This was primarily driven by an increase of $3.9 million in CRO and other clinical expenses as we opened additional investigational sites and enrolled patients in our clinical program, offset by a decrease of $2.8 million in CDMO manufacturing and process development expense.

Previous wording

Personnel related costs (including stock-based compensation) increased by $0.5 million due to hiring in our research and development organization to support our clinical trials and manufacturing.

Current wording

Personnel related costs (including stock-based compensation) increased by $0.7 million due to hiring in our research and development organization to support our clinical trials and manufacturing.

Previous wording

General and administrative expenses decreased by $0.5 million, from $8.1 million for the six months ended June 30, 2025 to $7.6 million for the six months ended June 30, 2026. The decrease in general and administrative expenses was primarily attributable to a decrease of $1.3 million in directors’ and officers’ insurance due to a $1.5 million charge for directors' and officers' insurance for AlloVir, Inc. (“AlloVir”) following the closing of the Merger offset by an increase of $1.0 million in personnel related expenses (including stock-based compensation) to support operating as a public company.

Current wording

General and administrative expenses decreased by $0.7 million, from $11.8 million for the nine months ended September 30, 2025 to $11.1 million for the nine months ended September 30, 2026. The decrease in general and administrative expenses was primarily attributable to a decrease of $1.3 million in directors’ and officers’ insurance due to a charge for directors' and officers' insurance for AlloVir, Inc. (“AlloVir”) following the closing of the Merger in 2025 and a decrease of $0.7 million in professional services, consulting and other general and administrative expenses, offset by an increase of $1.3 million in personnel related costs (including stock-based compensation).

Previous wording

For the six months ended June 30, 2025, we recognized a $0.4 million gain related to the changes in the fair value of tranche liability. The convertible promissory notes issued in the Convertible Note Financing in October and November 2024 and amended in November 2024 included three subsequent tranches for the issuance of convertible promissory notes at the predetermined conversion price that were concluded to be liabilities and are accounted for at fair value until the tranches’ expiration or settlement. In January 2025, as part of the first tranche of the Additional Permitted Bridge Financing, we issued additional convertible promissory notes for $3.75 million and one of three tranches was settled. In March 2025, we and other noteholders entered into an acknowledgment of conversion and termination agreement to cancel all unfunded tranches and the tranche liability expired unexercised.

Current wording

For the nine months ended September 30, 2025, we recognized a $0.4 million gain related to the changes in the fair value of tranche liability. The convertible promissory notes issued in the Convertible Note Financing in October and November 2024 and amended in November 2024 included three subsequent tranches for the issuance of convertible promissory notes at the predetermined conversion price that were concluded to be liabilities and are accounted for at fair value until the tranches’ expiration or settlement. In January 2025, as part of the first tranche of the Additional Permitted Bridge Financing, we issued additional convertible promissory notes for $3.75 million and one of three tranches was settled. In March 2025, we and other noteholders entered into an acknowledgment of conversion and termination agreement to cancel all unfunded tranches and the tranche liability expired unexercised.

Previous wording

For the six months ended June 30, 2025, we recognized a $1.2 million gain related to the changes in the fair value of derivative liabilities embedded into convertible promissory notes issued to Samsara and other investors. All outstanding convertible promissory notes, other than the AlloVir Note, were converted into either shares of redeemable convertible preferred stock or common stock and the derivative liability expired in connection with the closing of the Merger on March 18, 2025.

Current wording

For the nine months ended September 30, 2025, we recognized a $1.2 million gain related to the changes in the fair value of derivative liabilities embedded into convertible promissory notes issued to Samsara and other investors. All outstanding convertible promissory notes, other than the AlloVir Note, were converted into either shares of redeemable convertible preferred stock or common stock and the derivative liability expired in connection with the closing of the Merger on March 18, 2025.

Previous wording

For the six months ended June 30, 2025, we recognized $1.4 million of interest expense, which included the accrued interest and amortization of debt discount related to issued and outstanding convertible promissory notes issued to Samsara and other investors. All outstanding convertible promissory notes, other than the AlloVir Note, were converted into either shares of redeemable convertible preferred stock or common stock and the derivative liability expired in connection with the closing of the Merger on March 18, 2025.

Current wording

For the nine months ended September 30, 2025, we recognized $1.4 million of interest expense, which included the accrued interest and amortization of debt discount related to issued and outstanding convertible promissory notes issued to Samsara and other investors. All outstanding convertible promissory notes, other than the AlloVir Note, were converted into either shares of redeemable convertible preferred stock or common stock and the derivative liability expired in connection with the closing of the Merger on March 18, 2025.

Previous wording

For the six months ended June 30, 2025, we recognized $0.2 million of loss on extinguishment and on issuance of convertible promissory notes to Samsara and other investors. All outstanding convertible promissory notes, other than the AlloVir Note, were converted into either shares of redeemable convertible preferred stock or common stock and the derivative liability expired in connection with the closing of the Merger on March 18, 2025.

Current wording

For the nine months ended September 30, 2025, we recognized $0.2 million of loss on extinguishment and on issuance of convertible promissory notes to Samsara and other investors. All outstanding convertible promissory notes, other than the AlloVir Note, were converted into either shares of redeemable convertible preferred stock or common stock and the derivative liability expired in connection with the closing of the Merger on March 18, 2025.

Previous wording

Other income, net increased by $0.7 million from $1.1 million for the six months ended June 30, 2025 to $1.9 million for the six months ended June 30, 2026. This increase was primarily attributable to interest income received from money market funds and U.S. government treasury securities as a result of our increased cash position following the Merger and the 2025 Private Placement.

Current wording

Other income, net increased by $0.7 million from $1.9 million for the nine months ended September 30, 2025 to $2.6 million for the nine months ended September 30, 2026. This increase was primarily attributable to interest income received from money market funds and U.S. government treasury securities as a result of our increased cash position following the Merger and the 2025 Private Placement.

Previous wording

From inception through June 30, 2026, we have received gross proceeds of $67.5 million from sales of redeemable convertible preferred stock, issuances of convertible promissory notes and a SAFE, we received cash and cash equivalents of AlloVir of approximately $102.1 million in the Merger, and we received aggregate gross proceeds of $50.0 million from the 2025 Private Placement. As of June 30, 2026, we had $93.5 million in cash, cash equivalents and marketable securities.

Current wording

From inception through September 30, 2026, we have received gross proceeds of $67.5 million from sales of redeemable convertible preferred stock, issuances of convertible promissory notes and a SAFE, we received cash and cash equivalents of AlloVir of approximately $102.1 million in the Merger, and we received aggregate gross proceeds of $50.0 million from the 2025 Private Placement. As of September 30, 2026, we had $82.9 million in cash, cash equivalents and marketable securities.

Previous wording

On April 3, 2026, we filed the Shelf Registration Statement with the SEC, which was declared effective on April 13, 2026. Under the Shelf Registration Statement, we may offer and sell up to $350.0 million of a variety of securities including common stock, preferred stock, debt securities, subscription rights, warrants or units during the three-year period that commenced upon the Shelf Registration Statement becoming effective. Pursuant to the Sales Agreement with TD Cowen which we may issue and sell, from time to time, up to an aggregate of $100.0 million of our common stock in the At-the-Market Offering through TD Cowen, as sales agent. As of June 30, 2026, we had capitalized $0.5 million of deferred transaction costs related to the At-the-Market Offering. We have not sold any shares of our common stock pursuant to the At-the-Market Offering.

Current wording

On April 3, 2026, we filed the Shelf Registration Statement with the SEC, which was declared effective on April 13, 2026. Under the Shelf Registration Statement, we may offer and sell up to $350.0 million of a variety of securities including common stock, preferred stock, debt securities, subscription rights, warrants or units during the three-year period that commenced upon the Shelf Registration Statement becoming effective. Pursuant to the Sales Agreement with TD Cowen which we may issue and sell, from time to time, up to an aggregate of $100.0 million of our common stock in the At-the-Market Offering through TD Cowen, as sales agent.

Previous wording

We have incurred significant losses and negative cash flows from operations since our inception. As of June 30, 2026, we had an accumulated deficit of $182.4 million. Based on our current operating plans, we believe that our existing cash, cash equivalents and marketable securities will be sufficient to fund our operating expenses and capital expenditure requirements into the fourth quarter of 2027. However, we have based these estimates on assumptions that may prove to be wrong, and our operating plans may change as a result of many factors currently unknown to us. In addition, changing circumstances could cause us to consume capital significantly faster than we currently anticipate, and we may need to spend more than currently expected because of circumstances beyond our control. As a result, we could deplete our capital resources sooner than we currently expect.

Current wording

We have incurred significant losses and negative cash flows from operations since our inception. As of September 30, 2026, we had an accumulated deficit of $193.4 million. Based on our current operating plans, we believe that our existing cash, cash equivalents and marketable securities will be sufficient to fund our operating expenses and capital expenditure requirements into 2028. However, we have based these estimates on assumptions that may prove to be wrong, and our operating plans may change as a result of many factors currently unknown to us. In addition, changing circumstances could cause us to consume capital significantly faster than we currently anticipate, and we may need to spend more than currently expected because of circumstances beyond our control. As a result, we could deplete our capital resources sooner than we currently expect.

Previous wording

Net cash used in operating activities was $22.6 million and $20.0 million for the six months ended June 30, 2026 and 2025, respectively.

Current wording

Net cash used in operating activities was $33.2 million and $31.3 million for the nine months ended September 30, 2026 and 2025, respectively.

Previous wording

Cash used in operating activities for the six months ended June 30, 2026, was primarily due to a net loss of $22.4 million, offset by non-cash charges of $1.0 million and further offset by net changes in net operating assets and liabilities of $1.3 million. Non-cash charges primarily consist of $1.2 million in stock-based compensation expense offset by $0.3 million in accretion of discounts on marketable securities. The unfavorable net change in net operating assets and liabilities was primarily due to an increase in prepaid expenses and other current assets of $1.0 million and an increase in other non-current assets of $0.8 million, offset by an increase in accrued expenses and other current liabilities of $0.9 million.

Current wording

Cash used in operating activities for the nine months ended September 30, 2026, was primarily due to a net loss of $33.4 million, offset by non-cash charges of $1.9 million and increased by net changes in operating assets and liabilities of $1.6 million. Non-cash charges primarily consist of $2.0 million in stock-based compensation expense. The unfavorable net change in operating assets and liabilities was primarily due to an increase in prepaid expenses and other current assets of $1.0 million, an increase in other non-current assets of $1.1 million and a decrease in accrued expenses and other current liabilities of $1.0 million, offset by an increase of $1.5 million in accounts payable.

Previous wording

Cash used in operating activities for the six months ended June 30, 2025, was primarily due to a net loss of $21.5 million, reduced by non-cash charges of $1.0 million and further reduced by net changes of $0.6 million in the net operating assets and liabilities. Non-cash changes primarily consist of a $1.0 million stock-based compensation expense, a gain of $1.2 million related to the change in fair value of derivative liabilities, a gain of $0.4 million related to the change in fair value of tranche liability, non-cash interest expense of $1.4 million and loss on issuance of convertible promissory notes of $0.2 million. The change in net operating assets and liabilities was primarily due to an increase in prepaid expenses and other current assets of $0.6 million, an increase in other non-current assets of $0.3 million, an increase in accounts payable of $2.2 million, and a decrease in accrued expenses and other current liabilities of $0.8 million.

Current wording

Cash used in operating activities for the nine months ended September 30, 2025, was primarily due to a net loss of $33.4 million, offset by non-cash charges of $1.6 million and further offset by net changes of $0.6 million in operating assets and liabilities. Non-cash charges primarily consist of $1.6 million in stock-based compensation expense and $1.4 million in non-cash interest expense, offset by a gain of $1.2 million related to the change in fair value of derivative liabilities and a gain of $0.4 million related to the change in fair value of tranche liability. The favorable net change in operating assets and liabilities was primarily due to a decrease in prepaid expenses and other current assets of $1.5 million, offset by a decrease in accounts payable of $1.0 million.

Previous wording

Net cash used in investing activities for the six months ended June 30, 2026 was $30.2 million, which primarily consisted of $70.2 million in purchases of marketable securities offset by $40.0 million in proceeds from maturities of marketable securities. There was no cash used in investing activities for the six months ended June 30, 2025.

Current wording

Net cash used in investing activities for the nine months ended September 30, 2026 was $15.3 million, which primarily consisted of $70.3 million in purchases of marketable securities offset by $55.0 million in proceeds from maturities of marketable securities.

Previous wording

Net cash used in financing activities for the six months ended June 30, 2026 was $2.1 million, which consisted of $2.2 million in payments of issuance costs related to the 2025 Private Placement and deferred transaction costs related to the At-the-Market Offering, offset by $0.1 million in proceeds from the exercise of stock options.

Current wording

Net cash used in financing activities for the nine months ended September 30, 2026 was $2.1 million, which consisted of $2.2 million in payments of issuance costs related to the 2025 Private Placement and deferred transaction costs related to the At-the-Market Offering, offset by $0.1 million in proceeds from the exercise of stock options.

Previous wording

Net cash provided by financing activities for the six months ended June 30, 2025 was $107.3 million, which consisted of $102.1 million of cash and cash equivalents of AlloVir received in the Merger, proceeds from the issuance of a convertible promissory note of $7.5 million, partially offset by payments of transaction costs related to the Merger of $2.3 million.

Current wording

Net cash provided by financing activities for the nine months ended September 30, 2025 was $107.3 million, which consisted of $102.1 million of cash and cash equivalents of AlloVir received in the Merger, proceeds from the issuance of a convertible promissory note of $7.5 million, partially offset by payments of transaction costs related to the Merger of $2.3 million.

Previous wording

We enter into contracts in the normal course of business with CDMOs for clinical supply manufacturing, with CROs for clinical trials and with other vendors for clinical studies, supplies and other products and services for operating purposes. These agreements generally provide for termination at the request of either party generally with less than one-year notice and, therefore, our management believes that non-cancellable obligations under these agreements are not material. We do not currently expect any of these agreements to be terminated and did not have any non-cancellable obligations under these agreements as of June 30, 2026 and December 31, 2025.

Current wording

We enter into contracts in the normal course of business with CDMOs for clinical supply manufacturing, with CROs for clinical trials and with other vendors for clinical studies, supplies and other products and services for operating purposes. These agreements generally provide for termination at the request of either party generally with less than one-year notice and, therefore, our management believes that non-cancellable obligations under these agreements are not material. We do not currently expect any of these agreements to be terminated and did not have any material non-cancellable obligations under these agreements as of September 30, 2026.

Previous wording

We are required to pay certain milestone payments contingent upon the achievement of specific development and regulatory events in accordance with the UCSD Agreement. Refer to Note 7, Significant Agreements, in our condensed consolidated financial statements included elsewhere in this Quarterly Report for additional details. As of June 30, 2026 and December 31, 2025, we recognized an immaterial amount related to the UCSD Agreement in accrued expenses and other current liabilities in the condensed consolidated balance sheets. Over the life of the agreement through June 30, 2026, development milestones totaling $0.1 million have been achieved and incurred as research and development expenses. We did not achieve any development milestones and did not incur any related milestone expense during the three and six months ended June 30, 2026. We are required to pay royalties on sales of products developed under the UCSD Agreement. Our product candidate was in development as of June 30, 2026 and December 31, 2025, and no such royalties were due.

Current wording

We are required to pay certain milestone payments contingent upon the achievement of specific development and regulatory events in accordance with the UCSD Agreement. Refer to Note 7, Significant Agreements, in our condensed consolidated financial statements included elsewhere in this Quarterly Report for additional details. As of September 30, 2026 and December 31, 2025, we recognized an immaterial amount related to the UCSD Agreement in accrued expenses and other current liabilities in the condensed consolidated balance sheets. Over the life of the agreement through September 30, 2026, development milestones totaling $0.1 million have been achieved and incurred as research and development expenses. We did not achieve any development milestones and did not incur any related milestone expense during the three and nine months ended September 30, 2026 and 2025. We are required to pay royalties on sales of products developed under the UCSD Agreement. Our product candidate was in development as of September 30, 2026, and no such royalties were due.

Previous wording

In February 2025, we entered into an operating lease agreement for office space in Berkeley Heights, New Jersey. The lease commenced in September 2025 and is expected to terminate in December 2031. We can extend the lease term twice for an additional three years and can terminate the lease after four years and four months after the lease commencement date with a termination penalty of $0.3 million. Total remaining undiscounted payments under this lease are approximately $1.9 million. In addition to the base rent, we will pay our share of operating expenses and taxes. The lessor provided a tenant improvement allowance of up to $0.4 million, which we fully utilized in 2025.

Current wording

In February 2025, we entered into an operating lease agreement for office space in Berkeley Heights, New Jersey. The lease commenced in September 2025 and is expected to terminate in December 2031. We can extend the lease term twice for an additional three years and can terminate the lease after four years and four months after the lease commencement date with a termination penalty of $0.3 million. Total remaining undiscounted payments under this lease are approximately $1.8 million as of September 30, 2026. In addition to the base rent, we will pay our share of operating expenses and taxes. The lessor provided a tenant improvement allowance of up to $0.4 million, which we fully utilized in 2025.