Krystal Biotech, Inc.

NON-EMPLOYEE DIRECTOR COMPENSATION POLICY

The Board of Directors (the “Board”) of Krystal Biotech, Inc. (the “Company”) has adopted this Non-Employee Director Compensation Policy (the “Policy”) for purposes of compensating those directors of the Company who meet the eligibility requirements described herein (the “Eligible Directors”) for their time, commitment, and contributions to the Board.

This Policy has been developed to attract and retain experienced directors by providing them with compensation for their services in the form of cash and equity-based awards in such amounts that further the best interests of the Company and its stockholders.

Except as otherwise noted in this Policy, the cash and equity-based compensation described in this Policy shall be paid or be made, as applicable, to each Eligible Director automatically and without any further action by the Board or the stockholders.

In order to qualify as an Eligible Director for purposes of receiving compensation under this Policy, the director cannot concurrently be employed in any capacity by the Company or any of its subsidiaries.

ANNUAL PEER COMPANIES REVIEW AND NON-EMPLOYEE DIRECTOR COMPENSATION ASSESSMENT

Peer Companies

On an annual basis, the Compensation Committee of the Board (the “Compensation Committee”) shall retain an independent compensation consultant (the “Consultant”) to advise the Compensation Committee in connection with the Company’s non-employee director compensation program, including with respect to (i) the amount and type of non-employee director compensation, and (ii) any comparative or market data deemed appropriate by such Consultant. As part of such review, the Consultant shall recommend a group of peer companies (the “Peer Companies”) to be used as a reference in evaluating the competitiveness of the Company’s non-employee director compensation program.

(a) Peer Companies Selection Criteria

The Peer Companies shall be identified and selected based on certain criteria deemed appropriate by the Consultant to ensure similarity to the Company in industry and size, with additional refinement criteria applied to further identify the most comparable companies.

The criteria used by the Consultant for 2026 included the following:

•Ownership/Industry: Publicly traded biotechnology/pharmaceutical companies

•Market Capitalization: Approximately 0.5x to 2.0x of the Company’s market capitalization

•FDA Status: Companies with approved and marketed products

•Refinement Criteria: Companies that focus on gene therapy, cell therapy, orphan designation, and/or rare disease indications

Annual Non-Employee Director Compensation Review

In addition to recommending the Peer Companies, the Consultant shall annually conduct a review and prepare a written report evaluating the Company’s non-employee director compensation program in comparison to the current Peer Companies.

The Consultant’s report shall include, at a minimum:

(a) Program Structure and Design

A description of the structure of non-employee director compensation program at the Company and at each of the Peer Companies, including the prevalence of key design features, such as:

•whether cash compensation is provided solely in the form of an annual retainer or as a combination of retainers and meeting fees;

•the types of equity-based awards used (e.g., stock options, restricted stock units (“RSUs”), or a combination thereof); and

•whether equity-based awards are granted based on a fixed dollar value on the date of grant or a fixed number of options/RSUs.

(b) Compensation Levels and Benchmarking

A summary of the amounts of each component of non-employee director compensation at the Peer Companies, together with percentile rankings (25th, 50th, and 75th) for the group of Peer Companies, including:

•annual cash compensation for service as:

•a non-employee director;

•chair of the board of directors or lead independent director;

•chair of the audit committee, compensation committee, and nominating and corporate governance committee; and

•member of the audit committee, compensation committee, and nominating and corporate governance committee; and

•initial and annual equity-based awards.

(c) Competitive Assessment

An assessment of the overall competitiveness of the Company’s non-employee director compensation program relative to the current Peer Companies, including the Company’s percentile rankings for each element of cash and equity-based compensation versus the Peer Companies.

(d) Proposed Changes for Consideration

Based on the competitive assessment, the Consultant will provide potential considerations and changes to the non-employee director compensation program for the applicable year considering the Company’s market positioning compared to the Peer Companies.

Committee and Board Determination

The Compensation Committee shall conduct annually a review and assessment of all compensation, including cash and equity-based compensation, awarded by the Company to its non-employee directors. Such review shall include consideration of the Consultant’s report in determining whether to maintain, modify, or recommend changes to the Company’s non-employee director compensation program for the applicable year. The Compensation Committee shall recommend to the Board, on the basis of such annual review and assessment, the amount and type of compensation payable to non-employee directors.

The Board shall review and approve the annual non-employee director compensation program, taking into account the recommendation by the Compensation Committee as to such compensation.

2026 NON-EMPLOYEE DIRECTOR COMPENSATION PROGRAM

Engagement of Compensation Consultant

The Compensation Committee engaged Compensia, Inc. (“Compensia”), a national compensation consulting firm, to serve as its independent compensation consultant in connection with the review and design of the Company’s 2026 Non-Employee Director Compensation Program. Following the methodology set forth in this Policy, Compensia conducted an analysis and provided a recommendation to the Compensation Committee with respect to the 2026 Non-Employee Director Compensation Program.

2026 Peer Companies

The 2026 Peer Companies, as identified and selected by Compensia are set forth in the table below, together with the market capitalization for each company.

• Market Capitalization data per Standard & Poor’s CapIQ reflecting 30 trading day average as of December 19, 2025.

2026 Non-Employee Director Compensation Program

The Board approved the 2026 Non-Employee Director Compensation Program described below. The program is designed to compensate all Eligible Directors around the 50 th percentile of the Peer Companies for each element of compensation.

Effectiveness and Conditions

The 2026 Non-Employee Director Compensation Program shall be effective as of March 1, 2026, subject to the satisfaction of each of the following conditions:

(1)Stockholder Approval

Approval of this Policy, including the 2026 Non-Employee Director Compensation Program, by the affirmative vote of a majority of the Company’s stockholders present in person or represented by proxy and entitled to vote thereon, excluding the shares beneficially owned by (i) non-employee members of the Board and (ii) the defendants in the litigation entitled Corbin v. Janney, et al., C.A. No. 2025-1051-KSJM (Del. Ch.) (the “Action”), each of whom shall refrain from voting on such matter in their capacity as stockholders; and

(2)Court Approval of Settlement of the Action

The effectiveness of the final approval by the Delaware Court of Chancery of the settlement of the Action.

The stockholder vote on this Policy, including the 2026 Non-Employee Director Compensation Program, shall not be effective unless and until the Delaware Court of Chancery approves the settlement of the Action.

Upon satisfaction of both conditions, the Company shall promptly pay any cash compensation under the 2026 Non-Employee Director Compensation Program that was due but not paid. If both conditions have not been satisfied on or before June 30, 2026 (the date for the grant of the equity-based awards) but are later satisfied in 2026, the Company shall promptly grant the equity-based awards following the satisfaction of both conditions.

CASH COMPENSATION

(a) Board Retainer

Each Eligible Director shall receive an annual cash retainer of $50,000 for service on the Board, payable in quarterly installments in advance of the service for such quarter.

(b) Lead Independent Director Retainer

The Lead Independent Director shall receive an additional annual cash retainer of $40,000, payable in quarterly installments in advance of the service for such quarter.

(c) Committee Chairs and Members Retainers

Eligible Directors serving as chairpersons or members of Board committees shall receive the following additional annual cash retainers, payable in quarterly installments in advance of the service for such quarter:

** There was insufficient market data for Compensia to include the Science & Technology and Commercial Advisory committees in its report, and the compensation amounts shown for such committees may not represent the 50 th percentile of the 2026 Peer Companies.

(d) Proration

All cash compensation payable to Eligible Directors under the 2026 Non-Employee Director Compensation Program shall be pro-rated to reflect the March 1, 2026, effective date and, with respect to any Eligible Director who joins the Board after such date, shall be pro-rated to reflect such Eligible Director’s date of election or appointment to the Board.

EQUITY-BASED COMPENSATION

(a) 2026 Annual Equity-Based Awards for Continuing Eligible Directors

Each Eligible Director, excluding any Eligible Director who joins the Board during 2026, shall receive annual equity-based compensation awards with a grant date value of $400,000, which is the 50 th percentile of the 2026 Peer Companies’ annual equity-based awards. Subject to the “Effectiveness and Conditions” section above, such annual equity-based awards shall be granted on June 30, 2026. The equity-based awards shall be made in the form of 60% stock options ($240,000 grant date value) and 40% RSUs ($160,000 grant date value). The number of stock options and RSUs to be granted shall be determined based on the grant date fair value, as determined in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (or any successor provision). For stock options, the Company will use the Black-Scholes option pricing model to establish the grant date fair value, and the exercise price will be the closing price of the Company’s common stock as reported on the Nasdaq Global Select Market on the date of grant, or if the closing price is not reported on the applicable date of grant, the closing price on the most recent date on which such closing price is reported. The stock options and RSUs shall vest in full on the date that is one (1) year following the date of grant, subject to the Eligible Director’s continued service on the Board through such vesting date; provided, however, that if the Company’s next annual meeting of stockholders occurs prior to the first anniversary of the date of grant and an Eligible Director who is standing for re-election at such meeting is not re-elected, but otherwise continues to serve as a director through the date of such meeting, then the stock options and RSUs shall vest in full on the date of such meeting.

(b) 2026 Initial and Annual Equity-Based Awards for New Eligible Directors

Initial Equity-Based Awards. An individual who becomes an Eligible Director during 2026 (a “New Eligible Director”) shall receive initial equity-based compensation awards with a grant date value of $640,000, representing a 1.6x multiple of the annual equity-based awards for 2026, which multiple is the 50 th percentile of the Peer Companies. The initial equity-based awards shall be granted on the last trading day of the month in which such New Eligible Director is first elected or appointed to the Board. The initial equity-based awards shall be made in the form of 60% stock options ($384,000 grant date value) and 40% RSUs ($256,000 grant date value). The number of stock options and RSUs to be granted will be determined as of the grant date using the same valuation methodology described in (a) above. The stock options and RSUs shall vest in equal annual installments over a three (3)-year period on each anniversary of the grant date, subject to the New Eligible Director’s continued service on the Board through each applicable vesting date; provided, however, that if the Company’s annual meeting of stockholders occurs prior to an applicable vesting date and a New Eligible Director who is standing for re-election at such meeting is not re-elected, but otherwise continues to serve as a director through the date of such meeting, then only the tranche of stock options and RSUs scheduled to vest on the next applicable vesting date shall vest on the date of such meeting, and no additional stock options or RSUs shall vest thereafter.

Annual Equity-Based Awards. A New Eligible Director who joins the Board prior to June 30, 2026 (or whenever the 2026 annual equity-based awards are granted to the continuing Eligible Directors under the 2026 Non-Employee Director Compensation Program) shall be granted pro-rated annual equity-based awards to compensate such New Eligible Director for the period between the date they joined the Board and the date of grant of the 2026 annual equity-based awards. For example, if a New Eligible Director joins the Board on May 30, 2026, and the 2026 annual equity-based awards are granted on June 30, 2026, the New Eligible Director shall be granted annual equity-based awards on June 30, 2026, with a value of $33,334 (1/12 th of $400,000) in the form of 60% stock options ($20,000 grant date value) and 40% RSUs ($13,334 grant date value). The number of stock options and RSUs to be granted will be determined as of the grant date using the same valuation methodology described in (a) above and such stock options and RSUs shall vest in the same manner set forth in Section (a) above.

NON-EMPLOYEE DIRECTOR COMPENSATION PROGRAMS FOR EACH OF 2027 THROUGH (AND INCLUDING) 2030

If the conditions set forth in the “Effectiveness and Conditions” section above are satisfied in 2026, the Non-Employee Director Compensation Programs for each of 2027 through (and including) 2030 shall follow the same process and be structured as described above for the 2026 Non-Employee Director Compensation Program; provided, however, that the Board in its discretion, after reviewing the recommendation of the Compensation Committee as to the annual Non-Employee Director Compensation Program, may approve cash compensation and equity-based awards for such years, in the aggregate and/or by individual element of compensation, up to, but not exceeding, the 75 th percentile of the 2026 Peer Companies for each such element of compensation, without the need to seek or obtain additional stockholder approval.

The 75 th percentile compensation levels of the 2026 Peer Companies for cash and equity-based compensation, together with the corresponding 50 th percentile levels shown for comparison, are set forth below:

CASH COMPENSATION

** There was insufficient market data for Compensia to include the Science & Technology and Commercial Advisory committees in its report, and the compensation amounts shown for such committees may not represent the 50 th or 75 th percentile of the 2026 Peer Companies.

EQUITY-BASED COMPENSATION

NON-EMPLOYEE DIRECTOR COMPENSATION PROGRAMS AFTER 2030

If the conditions set forth in the “Effectiveness and Conditions” section above are satisfied in 2026, the annual non-employee director compensation programs for each year after 2030 shall follow the same process as set forth in the “Annual Peer Companies Review and Non-Employee Director Compensation Assessment” section above. The Board in its discretion, after reviewing the recommendation of the Compensation Committee, will approve the non-employee director compensation program structure and amounts of compensation for each year. The Board may approve cash compensation and equity-based awards for such year, in the aggregate and/or by individual element of compensation, up to, but not exceeding, the 75 th percentile of the Peer Companies for the applicable year without the need to seek or obtain additional stockholder approval.

EXPENSES

Upon presentation of documentation of such expenses reasonably satisfactory to the Company, each Eligible Director is entitled to be reimbursed for reasonable travel and related expenses incurred in connection with their participation in Board or Board committee meetings and other related activities, such as site visits in which they engage as directors.

EFFECTIVE DATE

Subject to the approval of the Policy, including the 2026 Non-Employee Director Compensation Program, by the Company’s stockholders and the Delaware Court of Chancery’s approval of the settlement of the Action as set forth above, the Policy shall be effective as of March 1, 2026.