Yarrow Bioscience, Inc.

Current report

We are a clinical-stage biotechnology company with a limited operating history as a combined company on which to assess our business; we have not completed any clinical trials, and have no products approved for commercial sale, which may make it difficult to evaluate our current business and likelihood of success and viability.

Current report

We are a clinical-stage biotechnology company with a limited operating history as a combined company. We completed the Merger on July 27, 2026 and, following the Merger, the pre-Merger business of Yarrow became our primary business. VYNE divested its commercial business in January 2022, and we do not intend to devote significant resources to the legacy VYNE product candidates, repibresib and VYN202, which we continue to evaluate for a potential sale, license, transfer, disposition, divestiture or other monetization transaction. Accordingly, VYNE’s historical operating results are not indicative of our future results of operations or prospects. Since Yarrow’s inception, Yarrow has incurred operating losses with no corresponding revenue and has utilized substantially all of its resources to identify, license and develop Yarrow’s lead product candidate, YB-101, to organize and staff the company and provide other general and administrative support for operations. Yarrow has no significant experience in initiating, conducting or completing preclinical studies or clinical trials, and none of Yarrow’s product candidates has completed a pivotal clinical trial or been approved for commercial sale. While the legacy VYNE business initiated and conducted clinical trials of its own product candidates, our management team and personnel following the Merger consist substantially of those of Yarrow prior to the Merger, and we do not expect to realize the full benefit of VYNE’s prior clinical development experience in advancing YB-101. In part because of this lack of experience, we cannot be certain that our clinical trials and any future preclinical studies will begin or be completed on time, if at all. In addition, we have not yet demonstrated an ability to obtain regulatory approvals for YB-101 or any future product candidate, manufacture a commercial-scale product or arrange for a third party to do so on our behalf, or conduct sales, marketing and distribution activities necessary for successful product commercialization. Consequently, any predictions about our future success or viability may not be as accurate as they could be if we had a longer operating history as a combined company.

Current report

In addition, as our business grows, we may encounter unforeseen expenses, restrictions, difficulties, complications, delays and other known and unknown factors. We will need to transition at some point from a company with an early-stage clinical development focus to a company capable of supporting larger scale clinical trials and eventually commercial activities. We may not be successful in such a transition. We also have limited experience operating as a combined company, and the integration of Yarrow’s operations with the legacy VYNE organization, including operating as a public company, may take longer or cost more than we expect and may divert management’s attention from the development of YB-101 and any future product candidate.

Current report

We will require substantial additional capital to finance our operations in the future. If we are unable to raise such capital when needed, or on acceptable terms, we may be forced to delay, reduce and/or discontinue development of YB-101 or our future commercialization efforts.

Current report

Developing biotechnology products is a long, time-consuming, expensive and uncertain process that takes years to complete. We expect our expenses to increase in connection with our ongoing activities, particularly as we conduct clinical trials of, and seek regulatory approval for YB-101, conduct any future preclinical studies, advance discovery efforts with respect to future product candidates, and advance any future programs and product candidates that we may license. Even if one or more of the product candidates that we develop is approved for commercial sale, we anticipate incurring significant costs associated with sales, marketing, manufacturing and distribution activities to launch any such product. Our expenses could increase beyond expectations if we are required by the FDA or other regulatory agencies to perform preclinical studies or clinical trials in addition to or more expansive than those that we currently anticipate. Because the design and outcome of our planned and anticipated clinical trials are highly uncertain, we cannot reasonably estimate the actual amount of funding that will be necessary to successfully complete the development and commercialization of any product candidate we develop. Our future capital requirements depend on many factors, including but not limited to:

Current report

•the scope, design, progress, results and costs of clinical development for YB-101 and any discovery or preclinical and clinical development of future product candidates;

Current report

•the costs and timing of preparing, filing and prosecuting patent applications, maintaining, defending and enforcing our intellectual property and proprietary rights, and defending intellectual property-related claims, including claims of infringement, misappropriation or other violations of third-party intellectual property;

Current report

•the costs, timing and outcome of the regulatory review of our product candidates and obtaining the requisite regulatory approvals;

Current report

•the costs of our future commercialization activities, either on our own or in collaboration with others, including product sales, marketing, manufacturing, and distribution for any product candidate for which we receive regulatory approval;

Current report

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

Current report

•the success of our current or future collaborations, including our collaboration with GenSci pursuant to the GenSci License Agreement;

Current report

As a result, we will require substantial additional funding to continue our operations. As of June 30, 2026, we had $22.9 million of cash and cash equivalents. After giving effect to the consummation of the Merger, we expect our existing cash and cash equivalents will be sufficient to enable us to fund our operating expenses and capital expenditure requirements into 2028. However, we will still need to raise additional capital to continue to fund our operations in the future. If we are unable to raise additional capital when needed, that could raise substantial doubt about our ability to continue as a going concern.

Current report

We may be required to seek additional funds sooner than planned through public or private equity offerings, debt financings, collaborations and licensing arrangements or other sources, and adequate additional financing may not be available to us on acceptable terms, or at all. Such financing may dilute our stockholders or the failure to obtain such financing may restrict our operating activities. Any additional fundraising efforts may divert our management from their day-to-day activities, which may adversely affect our business. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders will be diluted, and the terms may include liquidation or other preferences and anti-dilution protections that adversely affect the rights of our stockholders. Debt financing may result in the imposition of debt covenants, increased fixed payment obligations or other restrictions that may affect our business. If we raise additional funds through upfront payments or milestone payments pursuant to current or future collaborations with third parties, we may have to relinquish valuable rights to our product candidates, or grant licenses on terms that are not favorable to us. Our ability to raise additional capital may be adversely impacted by global macroeconomic conditions and volatility in the credit and financial markets in the United States and worldwide. Our failure to raise capital as and when needed or on acceptable terms could have a negative impact on our financial condition and our ability to pursue our business strategy, and we may have to delay, reduce the scope of, suspend or eliminate one or more of our product candidates, clinical trials or future commercialization efforts or cease our operations.

Current report

We expect to continue to incur losses for the foreseeable future and may not be able to achieve or sustain profitability in the future. We have no products approved for sale and may never generate meaningful revenue or become profitable.

Current report

Investment in biotechnology product development is a highly speculative undertaking and entails substantial upfront capital expenditures, with significant risks that any product candidate will fail to demonstrate adequate efficacy or an acceptable safety profile, gain regulatory approval and become commercially viable. Following the completion of the Merger, the Combined Company's business is primarily focused on the development of YB-101, our sole product candidate. We have no products approved for commercial sale, and we continue to incur significant research and development and other expenses related to our ongoing operations. Although the legacy VYNE business historically generated revenues under development and license agreements, including royalty payments from sales of Finacea foam under our license agreement with LEO Pharma, LEO Pharma has notified us of its decision to terminate the Finacea license agreement effective December 31, 2026 and we do not expect to recognize royalty revenue for periods after that date. Accordingly, we do not expect to generate meaningful revenue unless or until we successfully complete preclinical and clinical development and obtain regulatory approval of, and then successfully commercialize, YB-101 or any future product candidate.

Current report

We may never succeed in these activities and, even if we do, may never generate revenues that are significant or large enough to achieve profitability. If we are unable to raise sufficient additional capital to advance a product candidate to commercialization or generate sufficient revenue through the sale of any approved products, we may be unable to continue operations without additional funding.

Current report

As of June 30, 2026, we had an accumulated deficit of $764.2 million. We expect to continue to incur losses for the foreseeable future. Our operating expenses and net losses may fluctuate significantly from quarter to quarter and year to year. We anticipate that our expenses will increase substantially if and as we:

Current report

•advance our existing and any future product candidates through preclinical and clinical development;

Current report

•seek to identify additional product candidates;

Current report

•seek, obtain and maintain regulatory and marketing approvals for our product candidates;

Current report

•make milestone payments to GenSci under the GenSci License Agreement, and under any additional future collaboration or license agreements that we may enter into;

Current report

•ultimately establish a sales, marketing and distribution infrastructure to commercialize any drug products for which we may obtain regulatory approval, either on our own or in collaboration with others;

Current report

•generate revenue from commercial sales of product candidates for which we receive regulatory approval, if any;

Current report

•acquire or in-license products, intellectual property and technologies;

Current report

•establish clinical and commercial-scale cGMP capabilities through a third-party or our own manufacturing facility; and

Current report

•operate as a public company.

Current report

In addition, our expenses will increase if, among other things, we are required by the FDA or other regulatory authorities to perform clinical trials or studies in addition to, or different than, those that we currently anticipate, there are any delays in completing our clinical trials or the development of any of our product candidates, or there are any third-party challenges to our intellectual property or we need to defend against any intellectual property-related claim.

Current report

Our failure to become profitable would decrease our value and could impair our ability to raise capital, maintain our research and development efforts, expand our business and/or continue our operations. A decline in the value of our stock could also cause stockholders to lose all or part of their investment.

Current report

We face competition from entities that have developed or may develop product candidates for the diseases addressed by our product candidates.

Current report

The development and commercialization of drugs is highly competitive, particularly in the treatment of GD and TED. YB-101, if approved, will face significant competition and our failure to effectively compete may prevent us from achieving significant market penetration. We compete with a variety of multinational biopharmaceutical companies, specialized biotechnology companies and emerging biotechnology companies, including Immunovant, Inc., Biohaven Ltd., Amgen, Inc. (“Amgen”), which acquired TEPEZZA® from Horizon Therapeutics plc in October 2023, Alumis Inc., Argenx SE, Sanofi, Merida Biosciences, H. Lundbeck A/S, Lassen Therapeutics, Roche, Sling Therapeutics, Inc., Novartis AG (which acquired Tourmaline Bio, Inc. in October 2025), and Viridian Therapeutics, Inc., as well as academic institutions, governmental agencies, and public and private research institutions, among others. Many of the companies with which we are currently competing or will compete against in the future have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals, and regulatory approved products than we do, and are further along in the clinical development and/or commercialization process. Mergers and acquisitions in the pharmaceutical and biotechnology industry may result in even more resources being concentrated among a smaller number of our competitors. For example, in May 2025, Alumis Inc. and ACELYRIN, INC. completed a merger transaction and the combined company is advancing a subcutaneously delivered anti-IGF-1R antibody for the treatment of TED. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These competitors also compete with us in recruiting and retaining qualified scientific and management personnel, establishing clinical trial sites, raising capital, patient registration for clinical trials, establishing and defending rights to intellectual property, as well as in acquiring technologies complementary to, or necessary for, our product candidates.

Current report

Our competitors have developed or are developing, and may in the future develop, product candidates or products competitive with our product candidates. Competitive therapeutic treatments include those that have already been approved and accepted by the medical community and any potential new treatments, including those currently under clinical development. Our success will depend partially on our ability to develop and commercialize products that have a competitive safety, efficacy, dosing and/or presentation profile. Our commercial opportunity and success will be reduced or eliminated if competing products are safer, more effective, have a more attractive dosing profile or presentation or are less expensive than the products we develop, or if our competitors develop competing products or biosimilars that enter the market more quickly than we do and are able to gain market acceptance. Conversely, the lack of commercial success of other competing therapies may raise concerns about the financial viability of our product candidates.

Current report

In addition, because of the competitive landscape for thyroid autoimmune diseases, including GD and TED, we may also face competition for establishing trial sites and clinical trial enrollment. Patient enrollment will depend on many factors, including if potential clinical trial patients choose to undergo treatment with approved products or enroll in competitors’ ongoing clinical trials for product candidates that are under development for the same indications as our product candidates. An increase in the number of approved products for the indications we are targeting with our product candidates will likely further exacerbate this competition. Our inability to enroll a sufficient number of patients could, among other impacts, delay our development timeline, which may further harm our competitive position.

Current report

YB-101 is in the clinical stages of development. YB-101 and our future product candidates may fail in development or suffer delays that materially and adversely affect our viability. If we or our current or future collaborators are unable to complete development of or commercialize our product candidates, or experience significant delays in doing so, our business will be materially harmed.

Current report

We have no commercially approved products. YB-101 is in the clinical stages of development, and we have not completed any clinical trials. As a result, we expect it will be many years before we commercialize any product candidate, if ever. Our ability to achieve and sustain profitability depends on obtaining regulatory approvals for, and successfully commercializing, our product candidates, either alone or with third parties, and we cannot guarantee you that we will ever obtain regulatory approval for any of our product candidates. We have not yet demonstrated our ability to complete any clinical trials, obtain regulatory approvals, manufacture a commercial-scale product or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful product commercialization. Before obtaining regulatory approval for the commercial distribution of any product candidate, we or an existing or future collaborator must conduct extensive preclinical tests and clinical trials to demonstrate the safety and efficacy in humans of the product candidate.

Current report

We or our collaborators may experience delays in initiating or completing preclinical studies or clinical trials. We or our collaborators also may experience numerous unforeseen events during, or as a result of, any future preclinical studies or clinical trials that we could conduct that could delay or prevent our ability to receive regulatory approval or commercialize our product candidates, including:

Current report

•regulators, such as the FDA, IRBs or comparable foreign regulatory authorities may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site;

Current report

•clinical trial sites may deviate from the trial protocol, fail to conduct trials in a compliant manner or drop out of a trial, which may require that we add new clinical trial sites or investigators or otherwise negatively impact the timing or integrity of our clinical trial(s);

Current report

•clinical trials of any product candidates may fail to show safety or efficacy, or may produce negative or inconclusive results and we may decide, or regulators may require us, to conduct additional preclinical studies or clinical trials or we may decide to abandon a product candidate;

Current report

•our third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all, or may deviate from the clinical trial protocol or suffer other quality or performance issues that negatively impact the timing or integrity of our clinical trial(s);

Current report

•we may elect to, or regulators, IRBs or ethics committees may require that we or our investigators, suspend or terminate clinical research or trials for various reasons, including noncompliance with regulatory requirements or a finding that the participants in our clinical trials are being exposed to unacceptable health risks;