Vaxart, Inc.

NOTE2. Summary of Significant Accounting Policies

Basis of Presentation, Liquidity and Going Concern – The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the accounting and disclosure rules and regulations of the SEC assuming the Company will continue as a going concern.

The Company is a clinical-stage biotechnology company withno product sales. Its primary source of financing is from the sale and issuance of common stock in public offerings as well as funding from the Biomedical Advanced Research and Development Authority (“HHS BARDA”), a division of the Administration for Strategic Preparedness and Response (“ASPR”) within the United States (“U.S.”) Department of Health and Human Services. In the past, we have also obtained funds from the issuance of common stock warrants, secured debt and preferred stock and from collaboration agreements. As of* December 31, 2025*, the Company had cash, cash equivalents and short-term investments of $63.8 million. The Company’s cash, cash equivalents and investments are sufficient to fund the Company’s planned operations for at least the period of12 months from the date the consolidated financial statements are issued.

The Company will be dependent upon raising additional capital through placement of its common stock, notes or other securities, borrowings, or entering into a partnership with a strategic party in order to implement its business plan. There can beno assurance that the Company will be successful raising additional capital in order to continue as a going concern.

Based on management’s current plan, including updated assumptions around the continued execution under the2024 ATI-RRPV Contract, and considering events occurring after the balance-sheet date, the Company reassessed its liquidity and going-concern evaluation. On* November 4, 2025,the Company entered into (i) an Exclusive License and Collaboration Agreement (the“2025* License and Collaboration Agreement”) and (ii) a Securities Purchase Agreement (“2025 Securities Purchase Agreement”) with Dynavax Technologies Corporation (“Dynavax”). Per the2025 License and Collaboration Agreement, the Company granted Dynavax an exclusive, worldwide license to develop and commercialize its investigational oral COVID-19 vaccine candidate. Dynavax agreed to pay the Company an up-front license fee of*$25.0* million and, pursuant to the2025 Securities Purchase Agreement, to purchase*$5.0* million of the Company’s common stock at $0.45 per share. The Company received a total of approximately $30.0 million from these transactions. Together with the Company’s updated operating plan and ongoing cost-management initiatives, these proceeds extend the Company’s cash runway into thesecond quarter of2027. Accordingly, management concluded that the conditions and events that previously raised substantial doubt about the Company’s ability to continue as a going concern have been alleviated. The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business.

These consolidated financial statements donot include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Basis of Consolidation – The consolidated financial statements include the financial statements of Vaxart, Inc. and its subsidiaries. All significant transactions and balances between Vaxart, Inc. and its subsidiaries have been eliminated in consolidation.

Use of Estimates – The preparation of consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets, liabilities (including accrued clinical and manufacturing accruals described within this Note2), revenues and expenses and disclosure of contingent assets and liabilities in the consolidated financial statements and accompanying notes. Actual results and outcomes could differ from these estimates and assumptions.

Foreign Currencies – Foreign exchange gains and losses for assets and liabilities of the Company’s non-U.S. subsidiaries for which the functional currency is the U.S. dollar are recorded in foreign exchange gain or loss, net within other income and (expenses) in the Company’s consolidated statements of operations and comprehensive income (loss). The Company hasno subsidiaries for which the local currency is the functional currency.

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Cash and Cash Equivalents – The Company considers all highly liquid debt investments with an original maturity ofthree months or less when purchased to be cash equivalents. Cash equivalents, which* may*consist of amounts invested in money market funds, corporate bonds and commercial paper, are stated at fair value.

Short-term Investments – Excess cash balances* maybe invested in marketable debt securities. All marketable debt securities that are readily convertible to known amounts of cash with stated maturities greater thanthree* months when purchased are classified as investments.

The Company determines the appropriate classification of its investments in marketable debt securities at the time of purchase and reevaluates such designation at each balance sheet date. Marketable debt securities are classified and accounted for as available-for-sale. The Company doesnot generally intend to sell the investments and it is more likely thannot that the investments willnot be required to be sold before recovery of the amortized cost bases, which* may*be at maturity.

Marketable debt securities are carried at fair value and unrealized gains and losses, net of taxes, are reported as a component of stockholders’ equity. Any realized gains or losses on the sale of marketable debt securities are determined on a specific identification method, and such gains and losses are recorded as a component of other income (expense). Available-for-sale investments are classified as either current or non-current assets based on each instrument’s underlying effective maturity date and whether the Company has the intent and ability to hold the investment for a period of greater than12 months. Marketable debt securities with remaining maturities of12 months or less are classified as current and are reported as short-term investments in the consolidated balance sheets. Marketable debt securities with remaining maturities of more than12 months for which the Company has the intent and ability to hold the investment for more than12 months are classified as non-current and are included in long-term investments in the consolidated balance sheets.

The Company excludes the applicable accrued interest from both the fair value and amortized cost basis of marketable debt securities for purposes of identifying and measuring an impairment. Accrued interest receivable on marketable debt securities is recorded within prepaid expenses and other current assets on the balance sheets. The Company’s accounting policy is tonot measure an allowance for credit loss for accrued interest receivable and to write-off any uncollectible accrued interest receivable as a reversal of interest income in a timely manner, which is considered to be in the period in which it is determined the accrued interest willnot be collected.

At each reporting date, the Company evaluates marketable debt securities with unrealized losses to determine whether such losses, if any, are due to credit-related factors. The Company records an allowance for credit losses when unrealized losses are due to credit-related factors. The Company evaluates, among other factors, whether the Company has the intention to sell any of its investments and whether it is more likely thannot that the Company will be required to sell any of them before recovery of the amortized cost basis. Neither of these criteria were met in any period presented. In addition, the Company invests in marketable debt securities with high credit ratings that are classified in Level1 and2 of the fair value hierarchy and it has received and expects to continue to receive interest and principal payments as the investments become due. Based on this evaluation, as of* December 31, 2025and2024*, the Company determined that unrealized losses of its marketable debt securities were primarily attributable to changes in interest rates and other non-credit related factors. As such,no allowance for credit losses were recorded for the years ended* December 31, 2025and2024*.

Concentration of Credit Risk – Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash, cash equivalents, available-for-sale investments and accounts receivable. The Company places its cash, cash equivalents and available-for-sale investments at financial institutions that the Company believes are of high credit quality. The Company is exposed to credit risk in the event of default by the financial institutions holding the cash and cash equivalents to the extent such amounts are in excess of the federally insured limits. Losses incurred or a lack of access to such funds could have a significant adverse impact on the Company’s financial condition, results of operations, and cash flows.

The primary focus of the Company’s investment strategy is to preserve capital and meet liquidity requirements. The Company’s investment policy addresses the level of credit exposure by limiting the concentration in anyone corporate issuer or sector and establishing a minimum allowable credit rating.

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Accounts Receivable and Unbilled Receivable from Government Contracts – Accounts receivable consists of government contract receivables from HHS BARDA for allowable cost-plus-fixed-fees and firm fixed-price, and royalty revenue receivable for sales, net of estimated returns, of Inavir and are reported at amounts expected to be collected in future periods. Unbilled receivable from government contracts consists of government revenue from HHS BARDA, which was earned andnot yet billed. An allowance for expected credit losses over the life of the receivables is reserved for based on a combination of historical experience, aging analysis, current economic trends and information on specific accounts, with related amounts recorded as a reserve against revenue recognized. The reserve is re-evaluated on a regular basis and adjusted as needed. Once a receivable is deemed to be uncollectible, such balance is charged against the reserve. The Company has providedno allowance for credit losses as of* December 31, 2025and2024*.

Accounts receivable and unbilled receivable from government contracts are subject to concentration risk whenever a customer has a balance that meets or exceeds10% of the Company's total accounts receivable balance or has a balance that meets or exceeds10% of the Company's total unbilled receivable balance. As of* December 31, 2025*, HHS BARDA represented 98% of the Company's total accounts receivable balance and 100% of the Company's total unbilled receivable balance. As of* December 31, 2024*, Daiichi Sankyo represented 52% of the Company's total accounts receivable balance, HHS BARDA represented 48% of the Company's total accounts receivable balance and HHS BARDA represented 100% of the Company's total unbilled receivable balance.

Prepaid Expenses and Prepaid Clinical Services, Long-Term – Prepaid expenses and prepaid clinical services, long-term consist of amounts paid in advance for services to be received in future periods and are recorded as assets when paid. Prepaid expenses are expensed when such amounts are utilized against costs from a specific vendor. Prepaid expenses are presented as short term (in prepaid expenses and other current assets) or long term (in prepaid clinical services, long-term) depending on whether such assets are expected to be utilized withinone year. In circumstances where the vendor needs to approve that prepaid expenses can be applied (such as by issuing a credit memo), the Company will continue to classify such expenses as long term (in prepaid clinical services, long-term).

Property and Equipment – Property and equipment is carried at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the respective assets. Depreciation begins at the time the asset is placed in service. Maintenance and repairs are charged to operations as incurred. Upon sale or retirement of assets, the cost and related accumulated depreciation are removed from the consolidated balance sheets and the resulting gain or loss is reflected in other income and (expenses) in the period realized.

The useful lives of the property and equipment are as follows:

Goodwill and Other Intangible Assets – Goodwill, which represents the excess of the purchase price over the fair value of assets acquired, isnot amortized. Intangible assets comprise developed technology and intellectual property. Intangible assets are carried at cost less accumulated amortization. Amortization is computed using the straight-line method over useful life of 11.75 years for developed technology and 20 years for intellectual property.

Impairment of Long-Lived Assets – The Company reviews its long-lived assets, including property and equipment, goodwill and intangible assets with finite lives, for impairment in thefourth quarter of each year, and more frequently whenever events or changes in circumstances indicate the carrying amount of these assets* may**not* be recoverable. Recoverability of these assets is measured by comparison of the carrying amount of each asset to the future undiscounted cash flows the asset is expected to generate over its remaining life. When indications of impairment are present and the estimated undiscounted future cash flows from the use of these assets are less than the assets’ carrying value, the related assets will be written down to fair value. The Company assessed its developed technology asnot impaired in the years ended* December 31, 2025and2024* (see Note4).

Accrued Clinical and Manufacturing Expenses – The Company accrues for estimated costs of research and development activities conducted bythird-party service providers, which include the conduct of preclinical studies and clinical trials, and contract manufacturing activities. The Company records the estimated costs of research and development activities based upon the estimated amount of services provided and includes the costs incurred butnot yet invoiced within other accrued liabilities in the consolidated balance sheets and within research and development expense in the consolidated statements of operations and comprehensive income (loss). These costs can be a significant component of the Company’s research and development expenses.

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The Company estimates the amount of services provided through discussions with internal personnel and external service providers as to the progress or stage of completion of the services and the agreed-upon fee to be paid for such services. The Company makes significant judgments and estimates in determining the accrued balance in each reporting period. As actual costs become known, it adjusts its accrued estimates. Although the Company doesnot expect its estimates to be materially different from amounts actually incurred, its understanding of the status and timing of services performed, the number of subjects enrolled, and the rate of enrollment* mayvary from its estimates and could result in the Company reporting amounts that are too high or too low in any particular period. The Company’s accrued expenses are dependent, in part, upon the receipt of timely and accurate reporting from contract research organizations and otherthird*-party service providers. To date, the Company hasnot experienced any material differences between accrued costs and actual costs incurred.

Leases – The Company records operating leases as right-of-use assets and operating lease liabilities in its consolidated balance sheets for all operating leases with terms exceedingone year. Right-of-use assets represent the right to use an underlying asset for the lease term, including extension options considered reasonably certain to be exercised, and operating lease liabilities to make lease payments. Right-of-use assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term. To the extent that lease agreements donot provide an implicit rate, the Company uses its incremental borrowing rate based on information available at the lease commencement date to determine the present value of lease payments. We account for lease modifications that arenot separate leases by remeasuring the lease liability at the effective date of modification using updated lease terms and discount rates, with a corresponding adjustment to right-of-use assets. The expense for operating lease payments is recognized on a straight-line basis over the lease term and is included in operating expenses in the Company’s consolidated statement of operations and comprehensive income (loss). The Company has elected tonot separate lease and non-lease components of facilities leases, whereas non-lease components of equipment leases are accounted for separately from lease components.

Revenue Recognition – The Company recognizes revenue when it transfers control of promised goods or services to its customers, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To determine revenue recognition, the Company performs the followingfive steps:

Revenue from royalties earned as a percentage of end-user sales, including milestone payments based on achieving a specified level of sales, where a license is deemed to be the predominant item to which the royalties relate, is recognized as revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied), as required under the sales- and usage-based royalty exception.

Revenue from contracts with customers is recognized ratably, based on costs incurred, as the Company provides promised services to its customers in amounts that reflect the consideration that the Company expects to receive for those services.

The accounting for license and collaboration agreements requires significant judgment due to the complexity of the contractual terms and the application of revenue recognition guidance. In particular, the Company is required to evaluate whether performance obligations are satisfied over time or at a point in time and to determine the appropriate measure of progress for performance obligations satisfied over time. Estimating total expected inputs involves significant judgment and requires the Company to make assumptions regarding the scope of work, expected costs, and other factors that* may**not* be fully known at contract inception. These estimates are reviewed and updated on a periodic basis as additional information becomes available. Changes in estimates of total expected inputs or changes in the assessment of the timing of satisfaction of performance obligations* may*result in cumulative catch-up adjustments to revenue in the period in which the changes are identified, which could be material to the Company’s consolidated financial statements.

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Under firm fixed-price milestone contracts, the Company recognizes the firm fixed-price revenue as the milestones are substantially complete and the firm fixed-price for the milestone is earned (“firm fixed-price milestone”). Cash received in advance of the completion of a firm fixed-price milestone will be recorded as deferred revenue until the milestone has been substantially completed and earned.

Under cost reimbursable contracts, the Company recognizes revenue as allowable costs are incurred and the fixed fee is earned (“cost-plus-fixed-fee”). Reimbursable costs under the contract primarily include direct labor, subcontract costs, materials, equipment, travel, and approved overhead and indirect costs. Fixed fees under cost reimbursable contracts are earned in proportion to the allowable costs incurred in performance of the work relative to total estimated contract costs, with such costs incurred representing a reasonable measurement of the proportional performance of the work completed, as detailed in Note5.

Payments to the Company under cost reimbursable contracts are provisional payments subject to adjustment upon annual audit by the government. The Company believes that revenue for periodsnot yet audited has been recorded in amounts that are expected to be realized upon final audit and settlement. When the final determination of the allowable costs for any year has been made, revenue and billings* may*be adjusted accordingly in the period that the adjustment is known.

Revenue from the2025* License and Collaboration Agreement*

The Company enters into license and collaboration agreements that* mayinclude the grant of licenses to intellectual property, research and development services, participation on joint governance committees, and manufacturing technology transfer. The terms of such arrangements may*include non-refundable upfront payments, development and regulatory milestone payments, sales-based milestone payments, royalties on future product sales, and other contingent payments.

The Company accounts for its license and collaboration agreements in accordance with ASC606, Revenue from Contracts with Customers. Under ASC606, the Company identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to the identified performance obligations based on their relative standalone selling prices, and recognizes revenue when, or as, the performance obligations are satisfied.

Performance obligations under these arrangements* may*include licenses to intellectual property and research and development services. The Company evaluates whether licenses are distinct from other promised services and whether they represent functional intellectual property that provides a right to use intellectual property as it exists at a point in time or symbolic intellectual property that provides a right to access intellectual property over time. Licenses determined to be functional intellectual property are recognized at a point in time when control transfers to the customer. Research and development services are generally recognized over time as the services are performed.

The transaction price* mayinclude fixed consideration, such as upfront payments, and variable consideration, such as milestone payments and royalties. Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal of cumulative revenue recognized willnot* occur when the uncertainty associated with the variable consideration is resolved. Milestone payments that arenot subject to the sales-based royalty exception are evaluated under the variable consideration constraint and recognized when the associated uncertainty is resolved. Sales-based milestone payments and royalties are recognized as revenue when the underlying sales occur.

For performance obligations satisfied over time, the Company measures progress using an input method based on costs incurred relative to total estimated costs to complete the performance obligation. Estimates of total costs are reassessed at each reporting period, and adjustments to revenue are recorded as a cumulative catch-up if estimates change.

Research and Development Costs – Research and development costs are expensed as incurred. Research and development costs consist primarily of salaries and benefits, stock-based compensation, consultant fees,third-party costs for conducting clinical trials and the manufacture of clinical trial materials, certain facility costs and other costs associated with clinical trials. Payments made to other entities are under agreements that are generally cancelable by the Company. Advance payments for research and development activities are recorded as prepaid expenses. The prepaid amounts are expensed as the related services are performed.

For the year ended* December 31, 2025,one clinical research organization (“CRO”) andone analytical testing vendor collectively represented 76% of the Company's total research and development costs. For the year ended December 31, 2024,*one CRO represented 18% of the Company's total research and development costs.

Stock-Based Compensation – Stock-based compensation arrangements include stock option grants and restricted stock units (“RSU”s) awards under our equity incentive plans, as well as shares issued under our Employee Stock Purchase Plan (“ESPP”), through which employees* may*purchase our common stock at a discount to the market price. Stock-based compensation is measured at the grant date for all stock-based awards made to employees and non-employees based on the fair value of the awards, net of estimated forfeitures. Compensation expense for purchases under the ESPP is recognized based on the fair value of the award on the date of offering. The fair value of these awards is estimated using the Black-Scholes valuation model. The expected term of each option is estimated by taking the arithmetic average of its original contractual term and its average vesting term.

Net Income (Loss) Per Share– Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period, without consideration of potential common shares.

Diluted net income (loss) per common share is computed giving effect to all potential dilutive common shares, comprising common stock issuable upon exercise of stock options, warrants, RSUs and ESPP. The Company uses the treasury-stock method to compute diluted income (loss) per share with respect to its stock options, warrants, RSUs and ESPP. For purposes of this calculation, options, warrants, RSUs and ESPP plan grants to purchase common stock are considered to be potential common shares and are only included in the calculation of diluted net income per share when their effect is dilutive. In the event of a net loss, the effects of all potentially dilutive shares are excluded from the diluted net loss per share calculation as their inclusion would be antidilutive.

Reclassifications– Prior year data is subject to reclassification to conform to current year presentation.No reclassifications were made for the years ended* December 31, 2025and2024.*

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Recently Adopted Accounting Pronouncements

In* December 2023,the FASB issued ASU2023*-09, Income Taxes (Topic740*): Improvements to Income Tax Disclosures*, which enhances the annual income tax disclosures for the effective tax rate reconciliation and income taxes paid. ASU2023-09 is effective for annual reporting periods beginning after* December 15, 2024,with early adoption permitted. Income taxes information regarding the annual effective tax rate is now to be disclosed in a newly designed and expanded tabular format with mandatory prescriptive captions. Income tax payments, net of refunds received, will now be disclosed in the income tax footnotes, the disclosure of which would need to agree with the longstanding disclosure in the cash flow statement; and will be disaggregated by federal, states, and foreign jurisdictions and by “significant” jurisdictions within “states” and “foreign.” Companies can adopt the new requirements prospectively without revisions of comparative period disclosures but the income tax footnote disclosures in the year of adoption wouldnot* be comparable (2025 disclosures would follow the new requirements of ASU2023-09, while the comparative-period disclosures of2024 would follow the current disclosure requirements in ASC740-50, Income Taxes–Disclosure, and related SEC requirements). To maintain comparability, retroactive application to comparative-period disclosures is allowed. The Company adopted ASU2023-09 on a prospective basis during the year ended* December 31, 2025,withno* material impact on its consolidated financial statements.

Recently Issued Accounting PronouncementsNot Yet Adopted

In* November 2024,the FASB issued ASU2024*-03, Income Statement–Reporting Comprehensive Income–Expense Disaggregation Disclosures (Subtopic220*-40): Disaggregation of Income Statement Expenses*, which requires new disclosures to disaggregate prescribed natural expenses underlying any income statement caption. ASU2024-03 is effective for annual reporting periods beginning after* December 15, 2026,and interim reporting periods beginning after December 15, 2027,with early adoption permitted. The Company is currently assessing the impact ASU2024*-03 will have on the consolidated financial statement disclosures.

In* July 2025,the FASB issued ASU2025*-05, Measurement of Credit Losses for Accounts Receivable and Contract Assets, introducing a practical expedient and an accounting policy election for certain entities in estimating expected credit losses for current accounts receivable and current contract assets arising from transactions within the scope of ASC606, Revenue from Contracts with Customers. Under the practical expedient, entities* mayassume that current conditions as of the balance sheet date remain unchanged for the remaining life of the asset when developing forecasts. ASU2025*-05 is effective for the Company beginning in thefirst quarter of2026, with early adoption permitted, and should be applied prospectively. The Company is currently assessing the impact of the new guidance on its consolidated financial statement disclosures; however,no material effect is expected based on the current nature of the Company’s receivables and contract assets.

In* December 2025,the FASB issued ASU2025*-11, Interim Reporting (Topic270*): Narrow-Scope Improvements,* which clarifies the guidance in Topic270 to improve the consistency of interim financial reporting. The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU2025-11 is effective for fiscal years beginning after* December 15, 2027,including interim periods within those fiscal years, with early adoption permitted. The Company is currently assessing the impact ASU2025*-11 will have on the consolidated financial statement disclosures.

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In* December 2025,the FASB issued ASU2025*-12, Codification Improvements, which updates the Codification for a broad range of topics arising from technical corrections, unintended application of the Codification, clarifications, and other minor improvements. This ASU is effective for annual reporting periods beginning after* December 15, 2026,and interim periods within those annual reporting periods, with early adoption permitted on an issue-by-issue basis. ASU2025*-12 isnot expected to have a material effect on the Company's consolidated financial statements.

NOTE3. Fair Value of Financial Instruments

Fair value accounting is applied for all financial assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis (at least annually). Financial instruments include cash and cash equivalents, marketable securities, accounts receivable, accounts payable and accrued liabilities that approximate fair value due to their relatively short maturities.

Assets and liabilities recorded at fair value on a recurring basis in the consolidated balance sheets are categorized based upon the level of judgment associated with inputs used to measure their fair values. The accounting guidance for fair value provides a framework for measuring fair value and requires certain disclosures about how fair value is determined. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance also establishes athree-level valuation hierarchy that prioritizes the inputs to valuation techniques used to measure fair value based upon whether such inputs are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions made by the reporting entity.

Thethree-level hierarchy for the inputs to valuation techniques is briefly summarized as follows:

Level1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

Level2 – Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that arenot active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and

Level3 – Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little orno market data.

The following table sets forth the fair value of the Company’s financial assets that are measured on a recurring basis as of* December 31, 2025and2024* (in thousands):

The Company heldno financial liabilities measured on a recurring basis as of* December 31, 2025* or2024.

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NOTE4. Balance Sheet Components

(a)*** ***Cash, Cash Equivalents, and Short-Term Investments

Cash, cash equivalents and investments consisted of the following (in thousands):

As of* December 31, 2025and2024*, all investments were available-for-sale debt securities with remaining maturities of12 months or less. As of* December 31, 2025and2024*, the Company held 4 and 5 securities, respectively, in an unrealized loss position for12 months or less. Interest receivable as of* December 31, 2025and2024*, was $0.2 million and $0.2 million, respectively, and is recorded as a component of prepaid expenses and other current assets on the consolidated balance sheets.

At each reporting date, the Company performs an evaluation of impairment to determine if any unrealized losses are due to credit-related factors. The Company records an allowance for credit losses when unrealized losses are due to credit-related factors. Factors considered when evaluating available-for-sale investments for impairment include the severity of the impairment, changes in underlying credit ratings, the financial condition of the issuer, the probability that the scheduled cash payments will continue to be made and the Company’s intent and ability to hold the investment until recovery of the amortized cost basis. The Company has the ability, if necessary, to liquidate any of its cash equivalents and marketable securities to meet its liquidity needs.

As of* December 31, 2025and2024*, there wereno material declines in the market value of the Company’s available-for-sale investments due to credit-related factors. The Company doesnot intend to sell the investments, and it isnot more likely thannot that the Company will be required to sell the investments before recovery of their amortized cost basis. As of* December 31, 2025and2024*, no allowance for credit losses was recorded and the Company didnot recognize any impairment losses related to investments.

(b)*** ***Accounts Receivable

As of* December 31, 2025* accounts receivable of $14.6 million consisted of $14.2 million of government contract receivable from2024 ATI-RRPV Contract and $0.3 million of royalty receivable. As of* December 31, 2024*, accounts receivable balance of $5.7 million consisted of $2.7 million of government contract receivables from HHS BARDA and $3.0 million royalty receivable. See Note5.

The Company has providedno allowance for credit losses as of* December 31, 2025* and2024 based on historical collection experience, customer credit worthiness, the age of accounts receivable balances, regulatory changes and current economic conditions and trends that* may*affect a customer’s ability to pay.

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(c)*** ***Unbilled Receivable from Government Contracts

Unbilled receivable, which was earned andnot yet billed, consists of government contracts from HHS BARDA of $36.8 million and $6.2 million as of* December 31, 2025and2024*, respectively, as detailed in Note5.

(d)*** ***Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in thousands):

As of* December 31, 2025*, there was a significant concentration byone contract research organization (“CRO”), which represented 90% of the Company’s total prepaid expenses balance. As of* December 31, 2024,there was a significant concentration byone* CRO, which represented 28% of the Company’s total prepaid expenses balance.

(e)*** ***Property and Equipment, Net

Property and equipment, net consists of the following (in thousands):

Depreciation expense was $3.5 million, and $3.7 million for the years ended* December 31, 2025and2024*, respectively. There wereno impairments of the Company’s property and equipment recorded for the years ended* December 31, 2025and2024*.

(f)*** ***Prepaid Clinical Services, Long-Term

Prepaid clinical services, long-term were $25.2 million and $60.1 million for the years ended* December 31, 2025and2024*, respectively. The long-term prepaid clinical services represent amounts the Company has paid to a single CRO as a vendor deposit that will be utilized in more thanone year.

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(g)*** Right-of-Use****** Assets, Net***

Right-of-use assets, net comprises facilities of $11.4 million and $20.4 million as of* December 31, 2025and2024*, respectively.

(h)*** ***Intangible Assets, Net

Intangible assets are comprised of developed technology and intellectual property. Intangible assets are carried at cost less accumulated amortization. As of* December 31, 2025*, developed technology and intellectual property had remaining lives of 3.9 years and 2.0 years, respectively. In each of the years ended* December 31, 2025and2024*, there have beenno indicators of impairment.

Intangible assets consist of the following (in thousands):

Intangible asset amortization expense was $0.7 million for each of the years ended* December 31, 2025and2024*.

As of* December 31, 2025*, the estimated future amortization expense by year is as follows (in thousands):

(i)*** Goodwill***

Goodwill, which represents the excess of the purchase price over the fair value of assets acquired, was $4.5 million as of* December 31, 2025and2024*. As of* December 31, 2025and2024*, there have beenno indicators of impairment.

(j)*** Accounts Payable***

Accounts payable were $21.5 million and $7.0 million as of* December 31, 2025and2024*, respectively. As of* December 31, 2025*, there was a significant concentration byone CRO andone analytical testing vendor, which represented 94% of the Company’s total accounts payable balance. As of* December 31, 2024,there was a significant concentration byone* CRO, which represented 67% of the Company’s total accounts payable balance.

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(k) Deferred Government Revenue

Deferred government revenue represents amounts received from HHS BARDA contracts, consisting of the2024 ASPR-BARDA Contract (as defined in Note5) and the2024 ATI-RRPV Contract (as defined in Note5) where the earnings process isnot yet complete. The Company will recognize deferred government revenue once the earnings process is complete, in accordance with its revenue recognition policies.

The following table represents the Company's deferred government revenue (in thousands):

Amounts collected or invoiced during the year ended* December 31, 2025* primarily relate to amounts received on the2024 ATI-RRPV Contract (as defined in Note5) but for which revenue cannot yet be recognized due to contractual milestonesnot being achieved.

(l)*** Deferred Collaboration Revenue***

Deferred collaboration revenue represents amounts received from the2025 License and Collaboration Agreement with Dynavax, entered into in* November 2025 (as defined in Note5*), where the earnings process isnot yet complete. The Company will recognize deferred collaboration revenue once the earnings process is complete, in accordance with its revenue recognition policies.

The following table represents the Company's deferred collaboration revenue (in thousands):

***(m)***Other Accrued Liabilities

Other accrued liabilities consist of the following (in thousands):

As of* December 31, 2025and2024*, there was a significant concentration byone CRO, which represented 79% and 42% of the Company’s total other accrued liabilities balances, respectively.

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NOTE5. Revenue

Royalty Revenue Related to Sale of Future Royalties

The Company generates royalty revenue from the sale of Inavir in Japan, pursuant to a collaboration and license agreement that Aviragen entered into with Daiichi Sankyo Company, Limited (“Daiichi Sankyo”) in2009. In* September 2010,laninamivir octanoate was approved for sale by the Japanese Ministry of Health and Welfare for the treatment of influenza in adults and children, which Daiichi Sankyo markets as Inavir. Under the agreement, the Company currently receives a 4% royalty on net sales of Inavir in Japan. Based on information provided by Daiichi Sankyo, the Company believes the expiration of the last patent related to Inavir is in August 2036,at which time royalty revenue will cease. The Company’s royalty revenue is seasonal, in line with the flu season, so the majority of the Company’s royalty revenue and non-cash royalty revenue related to the sale of future royalties are earned in thefirst* andfourth fiscal quarters. The royalty revenue related to Inavir recognized for the years ended* December 31, 2025and2024*, was zero. The Company recognized non-cash royalty revenue related to the sale of future royalties of $1.9 million and $3.8 million for the years ended* December 31, 2025and2024*, respectively. Both royalty revenue and the non-cash royalty revenue related to the sale of future royalties are subject to a 5% withholding tax in Japan, for which $0.1 million and $0.2 million was included in income tax expense for the years ended* December 31, 2025and2024*, respectively, further detailed in Note6.

The Company recognized revenue from government contracts with HHS BARDA of $224.5 million and $24.9 million for the years ended* December 31, 2025and2024*, respectively, consisting of revenue from the2024 ASPR-BARDA Contract (as defined below) and the2024 ATI-RRPV Contract (as defined below) described in more detail below. Unbilled receivable from government contracts consists of government revenue from HHS BARDA, which was earned andnot yet billed. As of* December 31, 2025and2024*, the amount of unbilled receivable was $36.8 million and $6.2 million, respectively, and deferred revenue was $0.1 million and $65.4 million, respectively.

2024 ATI-RRPV Contract

In* June 2024,the Company entered into an agreement (as modified or amended from time to time, the“2024* ATI-RRPV Contract”) with Advanced Technology International, the Rapid Response Partnership Vehicle’s Consortium Management Firm funded by HHS BARDA, which was modified in thesecond half of2024 to increase funding and provide for the manufacturing of a vaccine candidate targeting theKP.2 strain and acquire an approved mRNA vaccine targeting theKP.2 strain. Pursuant to the2024 ATI-RRPV Contract, the Company* mayreceive funding of up to $460.7 million to conduct a Phase2b* comparative study evaluating the Company’s oral pill COVID-19 vaccine candidate against an mRNA vaccine comparator approved by the U.S. Food and Drug Administration (“FDA”). As of* December 31, 2025,the2024* ATI-RRPV Contract made available an aggregate amount of authorized milestones up to $316.1 million. Pursuant to ModificationNo. 6 to the2024 ATI-RRPV Contract, dated* March 10, 2026,the total amount of funding available for payment under the2024* ATI-RRPV Contract is approximately $316.0 million (see Note15) including $67.9 million of firm fixed price amounts and the remaining amount for reimbursement of costs incurred in trial preparation and execution activities. The2024 ATI-RRPV Contract further contemplates additional funding up to $144.7 million if the Company and HHS BARDA decide to continue with the Phase2b comparative study. The Company anticipates a further modification to the2024 ATI-RRPV Contract that will reflect the reduced scope of work and corresponding reduction in funding that resulted from previously issued stop work orders.

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The Company accounts for the2024 ATI-RRPV Contract under ASC958-605 and recognizes revenue as the firm fixed-price milestone is earned and allowable cost-plus-fixed-fees are incurred. Reimbursable costs under the2024 ATI-RRPV Contract primarily include direct labor, subcontract costs, materials, travel, and approved overhead and indirect costs. The2024 ATI-RRPV Contract contains terms and conditions that are customary for contracts with HHS BARDA of this nature, including the U.S. government having the right to terminate the contract for convenience or to terminate for default if the Company fails to meet its obligations as set forth in the statement of work. Revenue from government contracts recognized on the2024 ATI-RRPV Contract was $223.9 million, comprising of a cost-plus-fixed-fee of $158.4 million and a firm fixed-price milestone of $65.5 million, for the year ended* December 31, 2025*, based on costs incurred and the achievement of firm fixed-price milestones under the2024 ATI-RRPV Contract. Revenue from government contracts recognized on the2024 ATI-RRPV Contract was $16.2 million for the year ended* December 31, 2024,based on costs incurred and the achievement of firm fixed-price milestones under the2024* ATI-RRPV Contract. Deferred government revenue represents amounts that have been received from HHS BARDA and the earnings process isnot yet complete. Deferred government revenue in current liabilities was $0.1 million and $64.8 million as of* December 31, 2025and2024*, respectively. The remaining deferred government revenue will be recognized as revenue once the earnings process is complete.

The Company believes that if the2024 ATI-RRPV Contract were to be terminated prior to completion of the Phase2b comparative study, the costs incurred through the effective date of such termination and any settlement costs resulting from such termination would be allowable costs. Cost reimbursement payments to the Company are provisional payments subject to adjustment upon annual audit by the government. The Company believes that revenue for periodsnot yet audited will be recorded in amounts that are expected to be realized upon final audit and settlement. When the final determination of the allowable costs for any year has been made, revenue and billings* may*be adjusted accordingly in the period that the adjustment becomes known.

2024 ASPR-BARDA Contract

In* January 2024,the Company was awarded a contract (as amended, the“2024* ASPR-BARDA Contract”) by HHS BARDA with a base and all options value of $9.3 million. Under the2024 ASPR-BARDA Contract, the Company received an award to support clinical trial planning activities for a Phase2b clinical trial that would compare the Company’s XBB vaccine candidate to an mRNA comparator to evaluate efficacy for symptomatic and asymptomatic disease, systemic and mucosal immune induction, and adverse events. The2024 ASPR-BARDA Contract originally had a period of performance term that was set to expire in* July 2024,but the Company entered into an amendment in July 2024that extended the period of performance expiration date into October 2024.The Company accounts for the2024* ASPR-BARDA Contract under Accounting Standards Codification958-605 and recognizes revenue as donor-imposed conditions are met. Revenue from government contracts recognized on the2024 ASPR-BARDA Contract was $0.6 million and $8.7 million for the years ended* December 31, 2025and2024*, respectively, based on the achievement of certain milestones under the2024 ASPR-BARDA Contract. Deferred government revenue represents amounts that have been received from HHS BARDA and the earnings process isnot yet complete. Deferred government revenue in current liabilities waszero and $0.6 million as of* December 31, 2025and2024*, respectively.

Revenue from Dynavax License and Collaboration Agreement

On* November 4, 2025,the Company entered into the2025* License and Collaboration Agreement with Dynavax relating to the Company’s investigational oral vaccine candidate for COVID-19 based on its proprietary oral delivery platform (the “Vaccine Candidate”). Pursuant to the License Agreement, the Company granted Dynavax an exclusive, worldwide license to develop and commercialize the Company’s oral pill Vaccine Candidate for SARS-CoV-2, SARS coronavirus, or MERS coronavirus, including COVID-19 and all variants thereof. Under the terms of the2025 License and Collaboration Agreement, Dynavax paid the Company an upfront license fee of $25.0 million and purchased $5.0 million of the Company’s common stock pursuant to the2025 Securities Purchase Agreement. The2025 License and Collaboration Agreement includes the Company continue to develop the Vaccine Candidate by conducting and completing its ongoing Phase2b clinical trial and delivering the end-of-Phase2 data package, performing its obligations under the2024 ATI-RRPV agreement and conducting additional development and manufacturing activities related to the Vaccine Candidate.

Following the completion of the Company’s ongoing Phase2b clinical trial and a planned end-of-Phase2 meeting with the FDA, per the2025 License and Collaboration Agreement, Dynavax has the right to elect, in its sole discretion, to assume responsibility for the continued development of the Vaccine Candidate. If Dynavax elects to assume responsibility for such continued development of the Vaccine Candidate, then Dynavax has agreed to pay the Company an additional fee of $50.0 million. If Dynavax doesnot elect to assume responsibility for such continued development of the Vaccine Candidate, then the2025 License and Collaboration Agreement will terminate pursuant to its terms.

The Company determined that the2025 License and Collaboration Agreement represented a contract with a customer and should be accounted for in accordance with ASC606. The Company identifiedtwo performance obligations, (i) the exclusive license, together with the related transfer and manufacturing technology transfer (the “License Performance Obligation”), and (ii) the development program activities through delivery of theEOP2 Data Package, including participation in joint governance committees (the “Development Performance Obligation”).

The Company identified $25.8 million of total transaction price at inception, consisting of a non-refundable upfront payment of $25.0 million and the premium of approximately $0.8 million associated with Dynavax’s concurrent $5.0 million equity investment in the Company, which represented consideration in excess of the fair value of the common stock issued. The fixed consideration of $25.8 million was allocated to thetwo performance obligations on a relative standalone selling price basis. Revenue allocated to the License Performance Obligation was recognized at a point in time in thefourth quarter of2025 upon completion of the technology transfer, when Dynavax obtained the right to use and benefit from the licensed intellectual property. Revenue allocated to the Development Performance Obligation is recognized over time using an input method based on costs incurred relative to total estimated costs to complete the development program.

The2025 License and Collaboration Agreement also includes potential additional consideration in the form of evaluation fees, a $50.0 million election payment, regulatory and commercial milestone payments, and royalties on future product sales. Such amounts represent variable consideration and are included in the transaction price only to the extent that it is probable that a significant reversal of cumulative revenue recognized willnot occur. Sales-based milestones and royalties will be recognized as revenue when the underlying sales occur in accordance with the sales- or usage-based royalty exception in ASC606.

For the year ended* December 31, 2025*, the Company recognized revenue of $10.8 million from the2025 License and Collaboration Agreement, which consisted of license revenue of $8.7 million and collaboration revenue was $2.1 million. As of* December 31, 2025*, the amount of deferred collaboration revenue was $15.0 million, of which $13.0 million was classified as current and $2.0 million as non-current. The remaining deferred collaboration revenue will be recognized as revenue once the earnings process is complete.

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NOTE6. Liabilities Related to Sale of Future Royalties

In* April 2016,Aviragen entered into a Royalty Interest Acquisition Agreement (the “RIAA”) with HealthCare Royalty Partners III, L.P. (“HCRP”). Under the RIAA, HCRP made a $20.0 million cash payment to Aviragen in consideration for acquiring certain royalty rights (“Royalty Rights”) related to the approved product Inavir in the Japanese market. The Royalty Rights were obtained pursuant to the collaboration and license agreements (the “License Agreement”) and a commercialization agreement that the Company entered into with Daiichi Sankyo. Per the terms of the RIAA, during thefirst* royalty interest period of* April 1, 2016through March 31, 2025,HCRP is entitled to thefirst* $3.0 million and any cumulative remaining shortfall amount plus 15% of the next $1.0 million in royalties earned in each year commencing on* April 1,with any excess revenue being retained by the Company. Further, during thesecond* royalty interest period beginning* April 1, 2025and ending on December 24, 2029,HCRP is entitled to thefirst* $2.7 million and any cumulative remaining shortfall amount, plus 15% of the next $1.0 million in royalties, with any excess revenue being retained by the Company. A shortfall occurs when, during an annual period ending on* March 31,for thefirst* royalty interest period of* April 1, 2016through March 31, 2025,the Company’s royalty payments fall below $3.0 million; and $2.7 million for thesecond* royalty interest period of* April 1, 2025and ending on December 24, 2029,excluding the period of April 1, 2028through December 24, 2029.In the event there shall remain any cumulative remaining shortfall amount as of December 24, 2029,*any royalties received from Daiichi Sankyo subsequently by the Company would be payable to HCRP until the cumulative remaining shortfall amount has been paid.

For avoidance of doubt, the RIAA states, in the event there is a remaining cumulative remaining shortfall amount as of* December 24, 2029,the Company shallnot* be obligated to pay HCRP any royalty payment beyond what the Company is paid from Daiichi Sankyo. The cumulative remaining shortfall amount is the aggregate amount of the remaining shortfall for each annual period, which was $4.4 million and $6.0 million as of* December 31, 2025and2024*, respectively.

Under the relevant accounting guidance, due to a limit on the amount of royalties that HCRP can earn under the RIAA, this transaction was accounted for as a liability that is being amortized using the effective interest method over the life of the arrangement. The Company hasno obligation to pay any amounts to HCRP other than to pass through to HCRP its share of royalties as they are received from Daiichi Sankyo. To record the amortization of the liability, the Company is required to estimate the total amount of future royalty payments to be received under the License Agreement and the payments that will be passed through to HCRP over the life of this agreement. Consequently, the Company imputes interest on the unamortized portion of the liability and records non-cash interest expense using an estimated effective interest rate. The royalties earned in each period that will be passed through to HCRP are recorded as non-cash royalty revenue related to sale of future royalties, with any excessnot subject to pass-through being recorded as royalty revenue. When the pass-through royalties are paid to HCRP in the following quarter, the imputed liability related to sale of future royalties is commensurately reduced. The Company periodically assesses the expected royalty payments, and to the extent such payments are greater or less than the initial estimate, the Company adjusts the amortization of the liability and interest rate. As a result of this accounting, even though the Company doesnot retain HCRP’s share of the royalties, it will continue to record non-cash revenue related to those royalties until the amount of the associated liability, including the related interest, is fully amortized.

The following table shows the activity within the liability account during the year ended* December 31, 2025* (in thousands):

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NOTE7. Leases

The Company has obtained the right of use for office and manufacturing facilities undersix operating lease agreements with initial terms exceedingone year. The lease term at the commencement date is determined by considering whether renewal options and termination options are reasonably assured of exercise.

The Company obtained the right of use of real estate located in South San Francisco, California, in* November 2020under a lease that was scheduled to terminate on September 30, 2025,which had been extended until March 31, 2029,withno* additional extension option. On* December 18, 2025,the Company entered into an agreement to terminate this lease agreement effective May 15, 2026,which was originally scheduled to expire on March 31, 2029.The Company isnot* required to pay any termination fees or penalties in connection with the termination of the Lease. As a result of the lease modification, the Company remeasured the operating lease liability using the revised lease term. The adjustment to the related right-of-use asset was limited to its carrying amount, and the Company recognized a resulting gain of $1.0 million within operating expenses in the consolidated statement of operations and comprehensive income for the year ended* December 31, 2025.*

The Company obtained the right of use of another property also located in South San Francisco, California, in* June 2015that was scheduled to terminate on April 30, 2020,with afive-year extension option that the Company exercised in July 2019,extending the lease until April 30, 2025,which has been further extended until March 31, 2029,with an option to extend for an additional eight years. In September 2021,the Company executed a lease for a facility in South San Francisco, California, with an initial term expiring on March 31, 2029,with an option to extend for an additional eight years. This lease includes a component for tenant improvements that were substantially completed in thethree* months ended* September 30, 2022,when the lease for this component was deemed to have commenced for accounting purposes. It also includes a component for which tenant improvements of $3.1 million were completed and were recorded within right-of-use assets in the consolidated balance sheets when they were substantially completed in thethree* months ended* March 31, 2023.Further, the Company has the right of use of a facility located in South San Francisco, California, under a lease that terminates on March 30, 2029,with afive-year renewal option. On May 31, 2025,*the leases oftwo facilities in Burlingame, California expired.

As of* December 31, 2025*, the weighted average discount rate for operating leases with initial terms of more thanone year was 10.1% and the weighted average remaining term of these leases was 3.0 years. Discount rates were determined using the Company’s marginal rate of borrowing at the time each lease was executed or extended.

The following table summarizes the Company’s undiscounted cash payment obligations for its operating lease liabilities with initial terms of more than12 months as of* December 31, 2025* (in thousands):

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The Company is also required to pay for operating expenses related to the leased space, including common area maintenance, taxes and insurance. The operating expenses are incurred separately and werenot included in the present value of lease payments. Operating lease expenses for years ended* December 31*are summarized as follows (in thousands):

NOTE8. Commitments and Contingencies

(a)*** ***Purchase Commitments

As of* December 31, 2025*, the Company had approximately $21.1 million of non-cancelable purchase commitments, principally for clinical services which are expected to be paid within the next year. Approximately $20.1 million of non-cancelable purchase commitments are attributable to athird-party vendor that provides clinical services, that is reimbursable at approximately $21.6 million under a cost-plus-fixed-fees arrangement in the ATI-RRPV Contract. In addition, the Company has operating lease commitments as detailed in Note7.

(b)*** ***Indemnifications

In the ordinary course of business, the Company enters into agreements that* mayinclude indemnification provisions. Pursuant to such agreements, the Company mayindemnify, hold harmless and defend indemnified parties for losses suffered or incurred by the indemnified party. Some of the provisions will limit losses to those arising fromthird*-party actions. In some cases, the indemnification will continue after the termination of the agreement. The maximum potential amount of future payments the Company could be required to make under these provisions isnot determinable. The Company has also entered into indemnification agreements with certain officers and directors which provide, among other things, that the Company will indemnify and advance expenses incurred in connection with certain actions, suits or proceedings to such officer or director, under the circumstances and to the extent provided for therein, for expenses, damages, judgments, fines and settlements he or she* maybe required to pay in actions or proceedings which he or she is or may*be made a party by reason of his or her position as a director, officer or other agent of the Company, and otherwise to the fullest extent permitted under Delaware law and the Company’s Bylaws. The Company currently has directors’ and officers’ insurance.

(c)***