Aldeyra Therapeutics, Inc.

Previous wording

As we continue to execute on our strategy of expanding our product candidate pipeline, we may license or acquire new immune-modulating approaches with novel therapeutic potential.

Current wording

As we continue to execute on our strategy of expanding our product candidate pipeline, we may license or acquire new immune-modulating assets with novel therapeutic potential.

Previous wording

To date, substantially all of our research and development expenses have been incurred in connection with reproxalap and ADX‑2191, as well as the proof of concept trials with ADX‑629, which was a signal-finding molecule no longer under development. We expect our research and development expenses to increase for the foreseeable future as we advance ADX‑248, ADX‑246, and other compounds through preclinical and clinical development. The process of conducting clinical trials necessary to obtain regulatory approval is costly and time consuming. We are unable to estimate with any certainty the costs we will incur in the continued development of our product candidates. Clinical development timelines, the probability of success, and development costs can differ materially from expectations. We may never succeed in achieving marketing approval for our product candidates. The costs of clinical trials may vary significantly over the life of a project owing to, but not limited to, the following:

Current wording

To date, substantially all our research and development expenses have been incurred in connection with reproxalap and ADX‑2191, as well as the proof of concept trials with ADX‑629, which was a signal-finding molecule no longer under development. We expect our research and development expenses to increase for the foreseeable future as we advance ADX‑248, ADX‑246, and other compounds through preclinical and clinical development. The process of conducting clinical trials necessary to obtain regulatory approval is costly and time consuming. We are unable to estimate with any certainty the costs we will incur in the continued development of our product candidates. Clinical development timelines, the probability of success, and development costs can differ materially from expectations. We may never succeed in achieving marketing approval for our product candidates. The costs of clinical trials may vary significantly over the life of a project owing to, but not limited to, the following:

Previous wording

During the three months ended March 31, 2026 and 2025, our general and administrative expenses consisted primarily of employee-related expenses, including benefits and stock-based compensation for our full-time employees. Other general and administrative expenses include insurance premiums, consulting, and professional fees for auditing, tax, investor relations, and legal services, including patent-related costs. We expect that general and administrative expenses will increase in the future as we expand our operating activities, continue to incur additional costs associated with being a publicly traded company, and maintain compliance with exchange listing and SEC requirements. The general and administrative expense increases will likely include higher consulting costs, fees for commercializing our product candidates, legal fees, accounting fees, insurance premiums, and fees associated with investor relations.

Current wording

During the six months ended June 30, 2026 and 2025, our general and administrative expenses consisted primarily of employee-related expenses, including benefits and stock-based compensation for our full-time employees. Other general and administrative expenses include insurance premiums, consulting, and professional fees for auditing, tax, investor relations, and legal services, including patent-related costs. We expect that general and administrative expenses will increase in the future as we expand our operating activities, continue to incur additional costs associated with being a publicly traded company, and maintain compliance with exchange listing and SEC requirements. The general and administrative expense increases will likely include higher consulting costs, fees for commercializing our product candidates, legal fees, accounting fees, insurance premiums, and fees associated with investor relations.

Previous wording

Comprehensive loss is defined as the change in equity during a period from transactions and other events and/or circumstances from non-owner sources. For the three months ended March 31, 2026, comprehensive loss is equal to our net loss of $3.5 million. For the three months ended March 31, 2025, comprehensive loss is equal to our net loss of $9.9 million and our net unrealized loss on marketable securities of $36.0 thousand.

Current wording

Comprehensive loss is defined as the change in equity from transactions and other events from non-owner sources. For the six months ended June 30, 2026, comprehensive loss is equal to our net loss of $8.9 million. For the six months ended June 30, 2025, comprehensive loss is equal to our net loss of $19.7 million inclusive of an immaterial amount of unrealized loss on marketable securities.

Previous wording

There were no material changes to our critical accounting estimates during the three months ended March 31, 2026, as compared to those described in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our 2025 Annual Report. It is important that the discussion of our operating results that follow be read in conjunction with the critical accounting policies disclosed in our 2025 Annual Report.

Current wording

There were no material changes to our critical accounting estimates during the six months ended June 30, 2026, as compared to those described in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our 2025 Annual Report. It is important that the discussion of our operating results that follow be read in conjunction with the critical accounting policies disclosed in our 2025 Annual Report.

Previous wording

Research and development expenses. Research and development expenses were $2.4 million for the three months ended March 31, 2026, compared to $7.4 million for the three months ended March 31, 2025. The decrease of $5.0 million was primarily related to a decrease of $1.9 million in personnel costs, $1.6 million in drug product manufacturing costs, and $1.5 million in external clinical development costs.

Current wording

Research and development expenses. Research and development expenses were $3.5 million for the three months ended June 30, 2026, compared to $8.5 million for the three months ended June 30, 2025. The decrease of $5.0 million was primarily related to a decrease of $3.8 million in external clinical development costs and $1.6 million in drug product manufacturing costs.

Previous wording

For three months ended March 31, 2026, approximately 15% of the total research and development expenses related to the advancement of late-stage product candidates. The late-stage product candidate spend during the three months ended March 31, 2026 was primarily attributable to reproxalap. We do not track labor associated with each program and have allocated headcount costs on a pro-rated basis. Management believes the pro rata allocation is a reasonable estimate of the headcount costs associated with each of the programs noted above.

Current wording

For three months ended June 30, 2026, approximately 20% of the total research and development expenses related to the advancement of late-stage product candidates. The late-stage product candidate spend during the three months ended June 30, 2026 was primarily attributable to reproxalap. We do not track labor associated with each program and have allocated headcount costs on a pro-rated basis. Management believes the pro rata allocation is a reasonable estimate of the headcount costs associated with each of the programs noted above.

Previous wording

General and administrative expenses. General and administrative expenses were $1.1 million for the three months ended March 31, 2026, compared to $3.0 million for the three months ended March 31, 2025. The decrease of $1.9 million was primarily related to a decrease of $1.6 million in personnel costs and $0.3 million in legal costs.

Current wording

General and administrative expenses. General and administrative expenses were $2.4 million for the three months ended June 30, 2026, compared to $1.7 million for the three months ended June 30, 2025. The increase of $0.7 million was primarily related to an increase of $0.4 million in personnel costs and $0.3 million in legal costs.

Previous wording

Other income (expense). Total other income (expense), net, was $0.1 million and $0.5 million for the three months ended March 31, 2026 and 2025, respectively. The decrease in net other income of $0.4 million was principally due to a decrease in interest income as a result of a decrease in investments.

Current wording

Other income (expense). Total other income (expense), net, was $0.5 million and $0.9 million for the six months ended June 30, 2026 and 2025, respectively. The decrease in net other income of $0.4 million was principally due a decrease in interest income as a result of a decrease in investments, substantially offset by lower interest expense following the repayment of the Loan and Security Agreement.

Previous wording

We have funded our operations primarily from the sale of equity securities and convertible equity securities, as well as borrowings under credit facilities. Since inception, we have incurred operating losses and negative cash flows from operating activities and have devoted substantially all our efforts to research and development. At March 31, 2026, we had total stockholders’ equity of approximately $42.2 million , and cash and cash equivalents of $65.0 million. During the three months ended March 31, 2026, we had a net loss of approximately $3.5 million. We expect to generate operating losses for the foreseeable future.

Current wording

We have funded our operations primarily from the sale of equity securities and convertible equity securities, as well as borrowings under credit facilities. Since inception, we have incurred operating losses and negative cash flows from operating activities and have devoted substantially all our efforts to research and development. At June 30, 2026, we had total stockholders’ equity of approximately $37.9 million, and cash and cash equivalents of $45.1 million. During the six months ended June 30, 2026, we had a net loss of approximately $8.9 million. We expect to generate operating losses for the foreseeable future.

Previous wording

On November 15, 2024, we entered into the Expansion Side Letter (the Expansion Letter) with AbbVie. The Expansion Letter makes certain changes to the AbbVie Option Agreement, among other things, providing that we will conduct certain launch activities, which costs shall not exceed mid-single-digit millions of dollars without AbbVie’s approval, and which costs will be considered allowable expenses pursuant to the Collaboration Agreement upon the delivery of AbbVie’s written notice of exercising the AbbVie Option and entry into the Collaboration Agreement, such that 60% of our allowable expenses will be reimbursed by AbbVie in the event of exercise. If AbbVie does not deliver a written notice of exercising the AbbVie Option and we do not execute the Collaboration

Current wording

On November 15, 2024, we entered into the Expansion Side Letter (the Expansion Letter) with AbbVie. The Expansion Letter makes certain changes to the AbbVie Option Agreement, among other things, providing that we will conduct certain launch activities, which costs shall not exceed mid-single-digit millions of dollars without AbbVie’s approval, and which costs will be considered allowable expenses pursuant to the Collaboration Agreement upon the delivery of AbbVie’s written notice of exercising the AbbVie Option and entry into the Collaboration Agreement, such that 60% of our allowable expenses will be reimbursed by AbbVie in the event of exercise. If AbbVie does not deliver a written notice of exercising the AbbVie Option and we do not execute the Collaboration Agreement, we will remain solely responsible for such costs. AbbVie has also independently initiated pre-commercialization planning activities. In addition, the Exercise Period (as defined in the AbbVie Option Agreement) was restricted to ten (10) business days following the date, if any, that we receive approval from the U.S. Food and Drug Administration of the NDA for reproxalap in dry eye disease (the FDA Decision), provided that AbbVie shall provide us notice in case AbbVie determines that it will not exercise the AbbVie Option.

Previous wording

Based on our current operating plan, and excluding any potential licensing and product revenue, we believe that our cash and cash equivalents as of March 31, 2026, will be sufficient to fund our currently projected operating expenses and debt obligations into the second half 2028, including continued early and late-stage development of our product candidates in ocular and systemic immune-mediated diseases. We base our projections of operating capital requirements on our current operating plan, which includes several assumptions that may prove to be incorrect, and we may use all of our available capital resources sooner than we expect. Because of the numerous risks and uncertainties associated with research, development, regulatory requirements, and commercialization (as applicable) of product candidates, we are unable to estimate the exact amount of our working capital requirements. We will need to secure additional funding in the future, from one or more equity or debt financings, collaborations, or other sources, in order to carry out all of our planned research, development activities, and regulatory activities; commence or continue ongoing commercialization, including manufacturing, sales, marketing and distribution for our product candidates; or fulfill additional development requirements requested by the FDA. At this time, due to the risks inherent in the drug development process, we are unable to estimate with any certainty the costs we will incur in the continued clinical development and regulatory requirements of reproxalap, and our other product candidates. Subsequent trials or regulatory activities initiated at a later date will cost considerably more, depending on the results of our prior clinical trials, and feedback from the FDA or other third parties. Accordingly, we will continue to require substantial additional capital to continue our clinical development, regulatory, and potential commercialization activities. The amount and timing of our future funding requirements will depend on many factors, including, but not limited to:

Current wording

Based on our current operating plan, and excluding any potential licensing and product revenue, we believe that our cash and cash equivalents as of June 30, 2026, will be sufficient to fund our currently projected operating expenses into the second half 2028, including continued early and late-stage development of our product candidates in ocular and systemic immune-mediated diseases. We base our projections of operating capital requirements on our current operating plan, which includes assumptions that may prove to be incorrect, and we may use all of our available capital resources sooner than we expect. Because of the numerous risks and uncertainties associated with research, development, regulatory requirements, and commercialization (as applicable) of product candidates, we are unable to estimate the exact amount of our working capital requirements. We will need to secure additional funding in the future, from one or more equity or debt financings, collaborations, or other sources, in order to carry out all of our planned research, development activities, and regulatory activities; commence or continue ongoing commercialization, including manufacturing, sales, marketing and distribution for our product candidates; or fulfill additional development requirements requested by the FDA. At this time, due to the risks inherent in the drug development process, we are unable to estimate with any certainty the costs we will incur in the continued clinical development and regulatory requirements of reproxalap, and our other product candidates. Subsequent trials or regulatory activities initiated at a later date will cost considerably more, depending on the results of our prior clinical trials, and feedback from the FDA or other third parties. Accordingly, we will continue to require substantial additional capital to continue our clinical development, regulatory, and potential commercialization activities. The amount and timing of our future funding requirements will depend on many factors, including, but not limited to:

Previous wording

costs incurred in defending ourselves in any legal proceedings that we currently are or may be subject to; and

Current wording

costs incurred in defending ourselves in any legal proceedings; and

Previous wording

We may need or desire to obtain additional capital to finance our operations through debt, equity, or alternative financing arrangements. We may also seek capital through collaborations or partnerships with other companies. The issuance of debt could require us to grant additional liens on certain of our assets that may limit our flexibility. If we raise additional capital by issuing equity securities, the terms and prices for additional financings may be much more favorable to the new investors than the terms obtained by our existing stockholders. Additional financings also may significantly dilute the ownership of our existing stockholders. We are in a period of economic uncertainty, escalating trade tensions, inflation, and capital markets disruption, which has been significantly impacted by adverse developments affecting the financial services industry, geopolitical instability due to, among other things, the continued hostilities in Ukraine, Israel, and the surrounding areas. In addition, the disruption in the capital markets could make any financing more challenging, and there can be no assurance that we will be able to obtain such financing on commercially reasonable terms or at all. If we are unable to obtain additional financing, we may be required to reduce the scope of our future activities, which could harm our business, financial condition, and operating results. There can be no assurance that any additional financing required in the future will be available on acceptable terms, if at all.

Current wording

We may need or desire to obtain additional capital to finance our operations through debt, equity, or alternative financing arrangements. We may also seek capital through collaborations or partnerships with other companies. The issuance of debt could require us to grant additional liens on certain of our assets that may limit our flexibility. If we raise additional capital by issuing equity securities, the terms and prices for additional financings may be much more favorable to the new investors than the terms obtained by our existing stockholders. Additional financings also may significantly dilute the ownership of our existing stockholders. We are in a period of economic uncertainty, escalating trade tensions, inflation, and capital markets disruption, which has been significantly impacted by adverse developments affecting the financial services industry, geopolitical instability due to, among other things, the continued hostilities in Iran, Ukraine, Israel, and other areas. In addition, the disruption in the capital markets could make any financing more challenging, and there can be no assurance that we will be able to obtain such financing on commercially reasonable terms or at all. If we are unable to obtain additional financing, we may be required to reduce the scope of our future activities, which could harm our business, financial condition, and operating results. There can be no assurance that any additional financing required in the future will be available on acceptable terms, if at all.

Previous wording

We will continue to incur costs as a public company, including, but not limited to, costs and expenses for directors' fees; increased directors' and officers' insurance; investor relations fees; expenses for compliance with the Sarbanes-Oxley Act of 2002 and related rules implemented by the SEC and Nasdaq, on which our common stock is listed; and various other costs. The Sarbanes-Oxley Act of 2002 requires that we maintain effective disclosure controls and procedures and internal controls.

Current wording

We will continue to incur costs as a public company, including, but not limited to, costs and expenses for directors' fees; directors' and officers' insurance; investor relations fees; expenses for compliance with the Sarbanes-Oxley Act of 2002 and related rules implemented by the SEC and Nasdaq, on which our common stock is listed; and various other costs. The Sarbanes-Oxley Act of 2002 requires that we maintain effective disclosure controls and procedures and internal controls.

Previous wording

The following table summarizes our cash flows for the three months ended March 31, 2026 and 2025:

Current wording

The following table summarizes our cash flows for the six months ended June 30, 2026 and 2025:

Previous wording

Operating Activities. Net cash used in operating activities was $5.1 million for the three months ended March 31, 2026, compared to net cash used in operating activities of $12.5 million for the same period in 2025. The primary use of cash was to fund our operations. The decrease in the amount of cash used in operating activities for the three months ended March 31, 2026 as compared to 2025 was principally due to decreases in research and development activities, a reduction in the value of stock-based cash awards, and decreases in accrued expenses due to the amount and timing of payments for research and development activities for the three months ended March 31, 2026 compared to the same period in 2025.

Current wording

Operating Activities. Net cash used in operating activities was $9.7 million for the six months ended June 30, 2026, compared to net cash used in operating activities of $21.0 million for the same period in 2025. The primary use of cash was to fund our operations. The decrease in the amount of cash used in operating activities for the six months ended June 30, 2026 as compared to 2025 was principally due to decreases in research and development activities, a reduction in the value of stock-based cash awards, and decreases in accrued expenses due to the amount and timing of payments for research and development activities for the six months ended June 30, 2026 compared to the same period in 2025.

Previous wording

Investing Activities. There were no investing activities for the three months ended March 31, 2026, compared to $7.3 million provided by investing activities for the three months ended March 31, 2025, resulting from maturities of marketable securities offset by purchases of marketable securities.

Current wording

Investing Activities. Investing activities were immaterial for the six months ended June 30, 2026. For the six months ended June 30, 2025, net cash provided by investing activities was $6.7 million, primarily reflecting maturities of marketable securities offset by purchases of marketable securities.

Previous wording

Financing Activities. Net cash provided by financing activities was $0.1 million for the three months ended March 31, 2026, compared to $1.0 million for the three months ended March 31, 2025. The net cash provided by financing activities for the three months ended March 31, 2026 and March 31, 2025 consisted primarily of exercises of options.

Current wording

Financing Activities. Net cash used in financing activities was $15.2 million for the six months ended June 30, 2026, compared to net cash provided by financing activities was $1.0 million for the six months ended June 30, 2025. The net cash used in financing activities for the six months ended June 30, 2026 consisted primarily of the repayment of the outstanding Loan and Security Agreement. The net cash provided by financing activities for the six months ended June 30, 2025 consisted primarily of exercises of options.