AEON Biopharma, Inc. 10-K

Item 8. Financial Statements and Supplementary Data ​ Index to Consolidated Financial Statements ​ ​ ​ ​ ​ ​ ​ Report of Independent Registered Public Accounting Firm (PCAOB ID Number 185 ) ​ 86 ​ ​ ​ Consolidated Balance Sheets as of December 31, 2025 and 2024 ​ 87 ​ ​ ​ Consolidated Statements of Operations and Comprehensive (Loss) Income for the years ended December 31, 2025 and 2024 ​ 88 ​ ​ ​ Consolidated Statements of Stockholders’ Deficit for the years ended December 31, 2025 and 2024 ​ 89 ​ ​ ​ Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 202 4 ​ 90 ​ ​ ​ Notes to Consolidated Financial Statements ​ 91 ​ ​ ​ ​ ​ 85 Table of Contents Report of Independent Registered Public Accounting Firm ​ To the Stockholders and Board of Directors AEON Biopharma, Inc.: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of AEON Biopharma, Inc. and subsidiary (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive (loss) income, stockholders’ deficit, and cash flows for each of the years in the two-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles. Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has experienced recurring losses from operations and has a net capital deficiency and negative cash flows from operations that raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ KPMG LLP ​ We have served as the Company’s auditor since 2023. ​ San Diego, California March 30, 2026 ​ ​ 86 Table of Contents ​ ​ AEON BIOPHARMA, INC. CONSOLIDATED BALANCE SHEET S (in thousands, except share data and par value amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ December 31, ​ ​ 2025 ​ ​ ​ ​ ​ ​ 2024 ​ ​ ​ ​ ​ ​ ASSETS ​ ​ ​ ​ ​ Current assets: ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 3,006 ​ ​ $ 13 Prepaid expenses and other current assets ​ 392 ​ ​ 1,577 Total current assets ​ 3,398 ​ ​ 1,590 Property and equipment, net ​ 162 ​ ​ 235 Operating lease right-of-use asset ​ 1,052 ​ ​ 1,288 Other assets ​ 948 ​ ​ 29 Total assets ​ $ 5,560 ​ ​ $ 3,142 LIABILITIES AND STOCKHOLDERS' DEFICIT ​ ​ ​ ​ ​ Current liabilities: ​ ​ ​ ​ ​ Accounts payable ​ $ 942 ​ ​ $ 5,910 Accrued clinical trials expenses ​ 1,426 ​ ​ 3,571 Accrued compensation ​ 2,872 ​ ​ 1,068 Other accrued expenses ​ 1,657 ​ ​ 3,600 Total current liabilities ​ 6,897 ​ ​ 14,149 Convertible notes at fair value, including related party amount of $ 34,600 and $ 11,689 , at December 31, 2025 and 2024, respectively ​ 34,600 ​ ​ 11,689 Operating lease liability ​ 893 ​ ​ 1,145 Derivative liability ​ ​ 14,879 ​ ​ ​ — Warrant liabilities ​ ​ 3,276 ​ ​ ​ 1,187 Contingent consideration liability ​ ​ 42 ​ ​ ​ 3,541 Total liabilities ​ 60,587 ​ ​ 31,711 Commitments and contingencies (Note 7) ​ ​ ​ ​ ​ Stockholders’ Deficit: ​ ​ ​ ​ ​ Class A common stock, $ 0.0001 par value; 1,040,000,000 and 500,000,000 shares authorized at December 31, 2025 and 2024, and 12,105,902 and 555,511 shares issued and outstanding at December 31, 2025 and 2024, respectively ​ 9 ​ ​ 4 Additional paid-in capital ​ 415,783 ​ ​ 403,024 Accumulated deficit ​ ( 470,819 ) ​ ​ ( 431,597 ) Total stockholders' deficit ​ ( 55,027 ) ​ ​ ( 28,569 ) Total liabilities and stockholders' deficit ​ $ 5,560 ​ ​ $ 3,142 ​ See accompanying notes to the consolidated financial statements ​ 87 Table of Contents ​ ​ AEON BIOPHARMA, INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME (in thousands, except share and per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ ​ 2025 ​ ​ ​ 2024 Operating expenses: ​ ​ ​ ​ Selling, general and administrative ​ $ 12,208 ​ $ 13,643 Research and development ​ 4,094 ​ 14,181 Change in fair value of contingent consideration ​ ( 3,499 ) ​ ( 100,809 ) Total operating costs and expenses ​ 12,803 ​ ( 72,985 ) (Loss) income from operations ​ ( 12,803 ) ​ 72,985 Other (loss) income: ​ ​ ​ ​ Change in fair value of convertible notes ​ ( 22,911 ) ​ 3,311 Change in fair value of warrants ​ 84,934 ​ ( 14,719 ) Loss on issuance of warrants ​ ​ ( 75,644 ) ​ ​ — Loss on embedded forward purchase agreements ​ ​ — ​ ​ ( 19,667 ) Loss on derivative liability ​ ​ ( 13,088 ) ​ ​ — Other income, net ​ 290 ​ 95 Total other loss, net ​ ( 26,419 ) ​ ( 30,980 ) (Loss) income before taxes ​ ( 39,222 ) ​ 42,005 Income taxes ​ — ​ — Net (loss) income ​ $ ( 39,222 ) ​ $ 42,005 Basic net (loss) income per share ​ $ ( 3.95 ) ​ $ 77.74 Diluted net (loss) income per share ​ ​ ( 3.95 ) ​ ​ 72.93 Weighted average shares of common stock outstanding used to compute basic net (loss) income per share ​ ​ 9,921,587 ​ ​ 540,360 Weighted average shares of common stock outstanding used to compute diluted net (loss) income per share ​ 9,921,587 ​ 575,945 ​ ​ ​ See accompanying notes to the consolidated financial statements ​ ​ ​ ​ ​ 88 Table of Contents ​ AEON BIOPHARMA, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT (in thousands, except share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ​ ​ Common Stock ​ Paid-in ​ Subscription ​ Accumulated ​ Stockholders' ​ ​ Shares ​ Amount ​ Capital ​ Receivables ​ Deficit ​ Deficit Balance as of January 1, 2025 555,511 ​ $ 4 ​ $ 403,024 ​ $ — ​ $ ( 431,597 ) ​ $ ( 28,569 ) Net loss — ​ — ​ — ​ — ​ ( 39,222 ) ​ ( 39,222 ) Issuance of shares and reclassification of liability related to cashless warrant exercises 11,064,517 ​ 5 ​ 7,039 ​ — ​ — ​ 7,044 Issuance of shares related to at-the-market offering, net 218,419 ​ — ​ 168 ​ — ​ — ​ 168 Issuance of common stock ​ 267,455 ​ ​ — ​ ​ 235 ​ ​ — ​ ​ — ​ ​ 235 Stock-based compensation expense ​ — ​ ​ — ​ ​ 5,317 ​ ​ — ​ ​ — ​ ​ 5,317 Balance as of December 31, 2025 12,105,902 ​ $ 9 ​ $ 415,783 ​ $ — ​ $ ( 470,819 ) ​ $ ( 55,027 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance as of January 1, 2024 ​ 516,404 ​ $ 4 ​ $ 381,264 ​ $ ( 60,710 ) ​ $ ( 473,602 ) ​ $ ( 153,044 ) Net income ​ — ​ — ​ — ​ — ​ 42,005 ​ ​ 42,005 Termination of Forward Purchase Agreements ​ — ​ — ​ — ​ 60,710 ​ — ​ ​ 60,710 Issuance of shares and reclassification of liability related to cashless warrant exercises ​ 27,310 ​ ​ — ​ ​ 14,979 ​ ​ — ​ ​ — ​ ​ 14,979 Issuance of shares related to at-the-market offering, net ​ 2,241 ​ ​ — ​ ​ 147 ​ ​ — ​ ​ — ​ ​ 147 Issuance of common stock ​ 5,556 ​ ​ — ​ ​ 384 ​ ​ — ​ ​ — ​ ​ 384 Stock-based compensation expense ​ 4,000 ​ ​ — ​ ​ 6,250 ​ ​ — ​ ​ — ​ ​ 6,250 Balance as of December 31, 2024 555,511 ​ $ 4 ​ $ 403,024 ​ $ — ​ $ ( 431,597 ) ​ $ ( 28,569 ) ​ ​ ​ ​ ​ See accompanying notes to the consolidated financial statements ​ 89 Table of Contents AEON BIOPHARMA, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands, except per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ ​ 2025 ​ 2024 Cash flows from operating activities: ​ ​ ​ ​ ​ Net (loss) income ​ $ ( 39,222 ) ​ $ 42,005 Adjustments to reconcile net (loss) income to net cash used in operating activities: ​ ​ ​ ​ Depreciation ​ 78 ​ 97 Stock-based compensation expense ​ ​ 5,317 ​ 6,250 Non-cash issuance of common stock ​ ​ 250 ​ 384 Loss on issuance of warrants ​ 75,644 ​ — Change in fair value of convertible notes ​ ​ 22,911 ​ ( 3,311 ) Change in fair value of warrants ​ ​ ( 84,934 ) ​ 14,719 Change in fair value of embedded forward purchase agreements ​ — ​ 19,667 Loss on derivative liability ​ ​ 13,088 ​ ​ — Change in fair value of contingent consideration ​ ​ ( 3,499 ) ​ ​ ( 100,809 ) Changes in operating assets and liabilities: ​ ​ ​ ​ ​ Prepaid expenses and other current assets ​ 1,185 ​ ( 513 ) Accounts payable ​ ( 4,968 ) ​ 2,522 Accrued expenses and other liabilities ​ ( 2,206 ) ​ ( 1,423 ) Other assets and liabilities ​ ( 952 ) ​ 120 Net cash used in operating activities ​ ( 17,308 ) ​ ( 20,292 ) Cash flows from investing activities: ​ ​ ​ ​ Purchases of property and equipment ​ ( 4 ) ​ — Net cash used in investing activities ​ ( 4 ) ​ — Cash flows from financing activities: ​ ​ ​ ​ Proceeds from issuance of convertible notes ​ ​ — ​ ​ 15,000 Proceeds from issuance of at-the-market shares, net ​ ​ 168 ​ ​ 147 Proceeds from issuance of public offering shares, net ​ ​ 18,346 ​ ​ — Proceeds from PIPE financing ​ ​ 1,791 ​ ​ — Net cash provided by financing activities ​ 20,305 ​ 15,147 Net increase (decrease) in cash ​ 2,993 ​ ( 5,145 ) Cash and cash equivalent at beginning of period ​ 13 ​ 5,158 Cash and cash equivalent at end of period ​ $ 3,006 ​ $ 13 Supplemental disclosure of cash flow information: ​ ​ ​ ​ Non-cash operating activities ​ ​ ​ ​ Settlement of liability with common shares ​ $ 235 ​ $ — Non-cash financing activities: ​ ​ ​ ​ Cashless warrant exercises ​ $ 7,041 ​ $ — ​ ​ ​ ​ ​ See accompanying notes to the consolidated financial statements ​ 90 Table of Contents ​ AEON BIOPHARMA, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1. Organization Description of Business AEON Biopharma, Inc. is a biopharmaceutical company advancing its proprietary botulinum toxin complex, ABP-450 (prabotulinumtoxinA) injection (“ABP-450”) as a biosimilar to Botox® (onabotulinumtoxinA) to achieve accelerated and full-label United States (“U.S.”) market entry for debilitating medical conditions. The Company is headquartered in Irvine, California. On December 12, 2022, AEON Biopharma Sub, Inc. (formerly known as AEON Biopharma, Inc.) (“Old AEON”) and Priveterra Merger Sub, Inc., a wholly owned subsidiary of Priveterra Acquisition Corp. (“Priveterra”), a special purpose acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or other similar business combination with one or more target businesses, entered into a Business Combination and Merger Agreement (the “Business Combination Agreement” or “BCA”) dated December 12, 2022 and amended April 27, 2023. On July 21, 2023 (the “Closing Date”), the parties consummated the transactions contemplated by the BCA (collectively referred to as the “Merger” or “Business Combination”) in connection with the closing of the Merger (the “Closing”). On the Closing Date, Old AEON merged with Priveterra Merger Sub, Inc., with Old AEON surviving the merger as a wholly owned subsidiary of the Company; and the Company changed its name from “Priveterra Acquisition Corp.” to “AEON Biopharma, Inc.”; and Old AEON changed its name to AEON Biopharma Sub, Inc. The post-Merger Company is referred to herein as “AEON,” or the “Company.” The Company’s Class A common stock is trading on NYSE American under the symbol “AEON.” Liquidity and Going Concern The accompanying consolidated financial statements have been prepared on the basis that assumes the Company will continue as a going concern. The Company has experienced recurring losses from operations and has a net capital deficiency and negative cash flows from operations since its inception. As of December 31, 2025, the Company reported cash and cash equivalents of $ 3.0 million and an accumulated deficit of $ 470.8 million. The Company expects to incur losses and use cash in its operations for the foreseeable future. The Company is seeking accelerated and full-label U.S. market entry by developing its ABP-450 as a biosimilar through submission of a BLA under Section 351(k), using AbbVie Inc.’s product Botox® as a proposed reference product for all of the indications for which Botox® is approved, other than the cosmetic uses for which the Company does not hold development or commercialization rights. The Company held an initial meeting with the FDA in the third quarter of 2024 during which it aligned with the FDA on next steps to develop a Botox® biosimilar. The Company commenced analytical studies in the fourth quarter of 2024 to prepare for a BPD Type 2a meeting with the FDA that was held on January 21, 2026. During the meeting, the FDA reviewed the Company’s proposed analytical similarity strategy under the 351(k) biosimilar pathway, and acknowledged the scientific challenges associated with characterizing a 900 kDa botulinum neurotoxin complex, provided constructive feedback on the Company’s proposed development approach and analytical assessment plan, and noted that the analytical methodologies appeared reasonable to support advancement of the program toward a comprehensive analytical similarity package. The Company believes this feedback provides a clear framework for the remaining analytical components of its biosimilar development program and plans to complete the majority of its analytical comparability program in 2026. The Company is currently planning to request a BPD Type 2b meeting in 2026 to discuss the next phase of the development program to support approval of ABP-450 as a biosimilar to Botox® across all approved therapeutic indications. On August 14, 2024, the Company entered into an “at-the-market” sales agreement with Leerink Partners LLC (“Leerink Partners”) relating to an at-the-market offering program (the “ATM”), pursuant to which the Company may offer and sell, from time to time at its sole discretion, shares of common stock, registered pursuant to a shelf registration statement on Form S-3 that the Securities and Exchange Commission (the “SEC”) declared effective on August 21, 2024, having aggregate gross proceeds of up to $ 50.0 million through Leerink Partners as sales agent. As of December 31, 2025, the Company issued 218,419 shares under the ATM 91 Table of Contents for net proceeds of $ 0.2 million and approximately $ 49.7 million of common stock remained available to be sold under the ATM. See Note 9 Common Stock for additional information. On January 6, 2025, the Company entered into the Underwriting Agreement with Aegis pursuant to which the Company agreed to sell and issue shares of common stock and certain Series A and Series B Warrants. The closing of the Offering occurred on January 7, 2025, and the Company received net proceeds of approximately $ 18.3 million from the Offering. See Note 3 Public Offering for additional information. On November 12, 2025, the Company entered into the Securities Purchase Agreement with certain investors whereby the Company issued and sold to the investors certain PIPE Shares, PIPE Pre-Funded Warrants, PIPE Warrants and True-up Warrants for total gross proceeds of $ 6.0 million. The Company received gross proceeds of $ 1.8 million and $ 4.2 million upon the First Closing on November 18, 2025 (the “First Closing”) and the Second Closing on January 27, 2026 (the “Second Closing”), respectively. See Note 4 Private Placement for additional information. On November 12, 2025, the Company entered into the Term Sheet with Daewoong relating to the Exchange of the Subscription Agreement with Daewoong relating to the Existing Notes of $ 5.0 million and $ 10.0 million in principal with maturity dates of March 2027 and April 2027, respectively. On December 15, 2025, the Company entered into the Exchange Agreement with Daewoong consistent with the terms of the Term Sheet pursuant to which the Existing Notes held by Daewoong would be exchanged for (i) newly issued shares of common stock of the Company equal to (x) the principal and accrued interest of the Existing Notes as of the closing of the Exchange less (y) the principal amount of the New Convertible Note, divided by $ 1.00 , and then multiplied by 1.3 (and rounded down to the nearest whole share of common stock) and/or pre-funded warrants to purchase shares of common stock (the “Daewoong Pre-Funded Warrants”) in lieu of any shares of common stock that would result in Daewoong’s beneficial ownership of common stock exceeding 49.99 % (the “Exchange Shares”), (ii) a new senior secured convertible note for $ 1.5 million (the “New Convertible Note”), and (iii) warrants to purchase up to 8 million shares of common stock at an exercise price of $ 1.09392 per share (the “Daewoong Warrant”). The Daewoong Warrants, which contain the same terms as the PIPE Warrants, may only be exercised for cash. The Daewoong Warrants are immediately exercisable after issuance and may be able to be exercised at any time until the five-year anniversary of the Second Closing. See Note 5 Daewoong Convertible Notes for additional information. The commencement of additional studies, preparation for the potential BPD meeting and any further development of ABP-450 would require additional funding in the form of equity financings or debt. There can be no assurance that such efforts will be successful or that, in the event that they are successful, the terms and conditions of such financing will be commercially acceptable. Furthermore, the use of equity as a source of financing would dilute existing shareholders. As a result of these conditions, management has concluded that there is substantial doubt about the Company’s ability to continue as a going concern and to meet its obligations as they become due within one year after the date that these consolidated financial statements are issued. The preparation of these consolidated financial statements does not include any adjustments that may result from the outcome of this uncertainty. This basis of accounting contemplates the recovery of the Company ’ s assets and the satisfaction of the Company ’ s liabilities and commitments in the normal course of business and does not include any adjustments to reflect the possible future effects of the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. If the Company is unable to obtain adequate capital, it could be forced to cease operations. The Company’s future operations are highly dependent on a combination of factors, including (1) the success of its research and development programs; (2) the timely and successful completion of any additional financings; (3) the development of competitive therapies by other biotechnology and pharmaceutical companies; (4) the Company’s ability to manage growth of the organization; (5) the Company’s ability to protect its technology and products; and, ultimately (6) regulatory approval and successful commercialization and market acceptance of its product candidates. Note 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The consolidated financial statements include the accounts of the Company and its controlled subsidiaries. 92 Table of Contents Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and disclosures made in the accompanying notes. The Company’s most significant estimates relate to the research and development accruals, valuation of stock-based compensation, and the fair values of contingent consideration, warrant liabilities, convertible notes, and derivative liability, among others. Although the Company bases estimates on historical experience, knowledge of current events and actions it may undertake in the future, and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments over the carrying values of assets and liabilities, this process may result in actual results differing materially from those estimated amounts used in the preparation of the financial statements. Segment Reporting The Company determined that it operates and manages its business as one operating segment, focused on the research and development of ABP-450. The Company’s chief operating decision maker (“CODM”) is the Company’s Chief Executive Officer, who reviews its consolidated operating results for the purpose of assessing liquidity needs, allocating resources and evaluating financial performance. Asset information, including monitoring of its cash and cash equivalents, provided to the CODM is consistent with those reported on the consolidated balance sheets. The key measure of the Company’s single segment profit and loss that the CODM uses to allocate resources and assess performance is the Company’s operating (loss) income as reported on the consolidated statement of operations and comprehensive (loss) income. The table below shows a reconciliation of the Company’s net (loss) income, including the significant expense categories regularly provided to and reviewed by the CODM, as computed under US GAAP to the Company’s total consolidated net (loss) income as reported in the consolidated statement of operations and comprehensive (loss) income: ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 31, ​ 2025 ​ ​ ​ 2024 ​ ​ ​ ​ Segment operating expenses: ​ ​ ​ ​ ​ Compensation and benefits $ 10,431 ​ $ 9,153 Professional and legal fees 3,868 ​ 6,233 Office and travel ​ 1,017 ​ ​ 1,533 Research and development 986 ​ 10,905 Total selling, general and administrative, and research and development 16,302 ​ 27,824 Change in fair value of contingent consideration ​ ( 3,499 ) ​ ​ ( 100,809 ) Total operating costs and expenses ​ 12,803 ​ ​ ( 72,985 ) (Loss) income from operations ​ ( 12,803 ) ​ ​ 72,985 Other segment items: ​ ​ Change in fair value of convertible notes ( 22,911 ) ​ 3,311 Change in fair value of warrants 84,934 ​ ( 14,719 ) Loss on issuance of warrants ​ ( 75,644 ) ​ ​ — Loss on embedded forward purchase agreements ​ — ​ ( 19,667 ) Loss on derivative liability ​ ( 13,088 ) ​ — Other income, net 290 ​ 95 Total other segment items, net ( 26,419 ) ​ ( 30,980 ) (Loss) income before taxes ( 39,222 ) ​ 42,005 Income taxes — ​ — Segment net (loss) income $ ( 39,222 ) ​ $ 42,005 ​ Risk and Uncertainties The Company is subject to risks common to early-stage companies in the pharmaceutical industry including, but not limited to, dependency on the clinical and commercial success of its current and any future product candidates, ability to obtain regulatory 93 Table of Contents approval of its current and any future product candidates, the need for substantial additional financing to achieve its goals, uncertainty of broad adoption of its approved products, if any, by physicians and patients and significant competition. The Company relies on Daewoong, a South Korean pharmaceutical manufacturer, as an exclusive and sole supplier to manufacture the Company’s source material for product candidates. Any termination or loss of significant rights, including exclusivity, under the Company’s license and supply agreement with Daewoong (the “Daewoong Agreement”) would materially and adversely affect the Company’s commercialization of its products. See Note 7 Commitments and Contingencies for a discussion of the Daewoong Agreement. Property and Equipment Property and equipment are carried at cost less accumulated depreciation and amortization. The cost of property and equipment is depreciated over the estimated useful lives of the respective assets. The Company’s furniture and fixtures are depreciated on a straight-line basis over a period of seven years . Equipment is depreciated over a useful life of five years . Leasehold improvements are amortized over the lesser of the estimated useful life of the asset or the related lease term. Property and equipment, net, as of December 31, 2025 and 2024 are as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ December 31, ​ ​ ​ ​ ​ 2025 ​ ​ ​ ​ 2024 ​ Furniture and fixtures ​ $ 199 ​ ​ $ 199 ​ Equipment ​ 241 ​ ​ 237 ​ Leasehold improvements ​ 66 ​ ​ 66 ​ Property and equipment ​ 506 ​ ​ 502 ​ Accumulated depreciation ​ ( 344 ) ​ ​ ( 267 ) ​ Property and equipment, net ​ $ 162 ​ ​ $ 235 ​ ​ Other Accrued Expenses Other accrued expenses were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 ​ Legal expenses ​ $ 244 ​ ​ $ 2,455 ​ Excise tax liability ​ ​ 569 ​ ​ ​ 569 ​ Operating lease liability - short term portion ​ ​ 252 ​ ​ ​ 121 ​ Daewoong vial usage ​ ​ 228 ​ ​ ​ — ​ Remaining other accrued expenses ​ ​ 364 ​ ​ ​ 455 ​ Total other accrued expenses ​ $ 1,657 ​ $ 3,600 ​ ​ Convertible Notes The Company elected to account for its convertible promissory notes at fair value at inception and at each subsequent reporting date. Subsequent changes in fair value are recorded as a component of non-operating (loss) income in the consolidated statements of operations or as a component of other comprehensive (loss) income for changes related to instrument-specific credit risk. As a result of electing the fair value option, direct costs and fees related to the convertible promissory notes are expensed as incurred. Contingent Consideration The Company accounts for its contingent consideration as either equity-classified or liability-classified instruments based on an assessment of the contingent consideration specific terms (as further defined in Note 7) and applicable authoritative guidance in ASC 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). Based on the appropriate guidance, the Company determined that the contingent consideration would be classified as a liability on the consolidated balance sheets and remeasured at each reporting period with changes to fair value recorded to the consolidated statements of operations and comprehensive (loss) income. 94 Table of Contents Derivative Liability The Company accounts for its derivative liabilities as either equity-classified or liability-classified instruments based on an assessment of the specific terms and applicable authoritative guidance in ASC 480 and ASC 815. The Company identified that the First Closing of the PIPE contained pre-funded warrants, a tranche right obligation and a True-Up Warrant obligation, and the Second Closing contained pre-funded warrants, PIPE Warrants and True-Up Warrants. The pre-funded warrants and True-Up Warrants were determined to be equity classified under ASC 815 upon their issuance. The PIPE Warrants and the tranche right obligation (which encompasses the obligation to issue pre-funded warrants, PIPE Warrants, and the True-Up Warrants as of the Second Closing) were determined to not be indexed to the Company’s own stock under ASC 815, and as such are classified as liabilities. Accordingly, for the First Closing, the Company allocated the proceeds from the PIPE to the tranche right obligation at fair value. As the fair value of the tranche right obligation exceeded the proceeds received, the Company recognized a loss of $ 10.6 million as of the First Closing. The tranche right obligation was valued based on the excess of the fair value of the pre-funded warrants, PIPE Warrants, and True-Up Warrants to be issued as of the Second Closing over the proceeds to be received in the Second Closing. For the Second Closing, the Company will first allocate the proceeds to the PIPE Warrants at fair value, and any residual value will be allocated between the pre-funded Warrants and the True-Up Warrants based on relative fair value. The PIPE Warrants will be initially measured at fair value using a Black-Scholes calculation and recorded as a liability on the issuance date on the consolidated balance sheets, and remeasured at each reporting period with changes to fair value recorded to the consolidated statements of operations and comprehensive (loss) income. The valuation is subject to inputs and assumptions that have variability, including stock price, risk-free rate and volatility. As stock price, risk-free rate and/or volatility increases or decreases, this may result in an increase or decrease, respectively, in the liability. Warrants The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC 480 and ASC 815. The assessment considers whether the warrants are freestanding financial instruments and meet all of the requirements for equity classification, including whether the warrants are indexed to the Company’s own shares of common stock, among other conditions for equity classification. This assessment is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and remeasured at each balance sheet date thereafter until settlement. Changes in the estimated fair value of the warrants are recognized in the Company’s consolidated statements of operations and comprehensive (loss) income. The valuation is subject to inputs and assumptions that have variability, including stock price, risk free rate and volatility. As the stock price, risk free rate and/or volatility increases or decreases, this may result in an increase or decrease, respectively, in the liability. Fair Value of Financial Instruments Fair value is defined as the exchange price that would be received for an asset or an exit price paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Fair value measurements are based on a three-tiered valuation hierarchy, which is classified and disclosed by the Company in one of the three categories as follows: · Level 1 — Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; · Level 2 — Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities in active markets; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly, or can be corroborated by observable market data for substantially the full term of the asset or liability; and · Level 3 — Prices or valuation techniques that require unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. 95 Table of Contents The categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Leases The Company determines whether a contract is, or contains, a lease at inception. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset during the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at lease commencement based upon the estimated present value of unpaid lease payments over the lease term using the Company’s incremental borrowing rate applicable to the underlying asset unless the implicit rate is readily determinable. The Company determines the lease term as the noncancellable period of the lease, and may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Leases with a term of 12 months or less are not recognized on the balance sheets. Research and Development Expenses Research and development costs are expensed as incurred. Research and development expenses consist primarily of costs associated with clinical studies including clinical trial design, clinical site reimbursement, data management, travel expenses and the cost of products used for clinical trials and internal and external costs associated with the Company’s regulatory compliance and quality assurance functions, including the costs of outside consultants and contractors that assist in the process of submitting and maintaining regulatory filings, and overhead costs. Additionally, research and development expenses include employee compensation, including stock-based compensation, supplies, consulting, prototyping, testing, materials, travel expenses and an allocation of facility overhead expenses. Costs incurred in obtaining technology licenses are charged to acquired in-process research and development (“IPR&D”) if the technology licensed has not reached technological feasibility and has no alternative future use. The Company accrues the expenses for its clinical trial activities performed by third parties, including clinical research organizations and other service providers, based upon estimates of the work completed over the life of the individual study in accordance with associated agreements. The Company determines these estimates through discussion with internal personnel and outside service providers as to progress or stage of completion of trials or services pursuant to contracts with clinical research organizations and other service providers and the agreed-upon fee to be paid for such services. Payments made to outside service providers in advance of the performance of the related services are recorded as prepaid expenses and other current assets until the services are rendered. There have been no material adjustments to the Company’s estimates for clinical trial expenses through December 31, 2025. Stock-Based Compensation The Company recognizes compensation expense for all share-based awards. The Company accounts for stock-based compensation as measured at grant date, based on the fair value of the award. The Company measures the fair value of awards granted using the Black-Scholes option pricing model, which requires the input of subjective assumptions, including the estimated fair value of common stock, the expected volatility of the Company’s common stock, expected risk-free interest rate, and the option’s expected life. The Company also evaluates the impact of modifications made to the original terms of equity awards when they occur. The fair value of equity awards that are expected to vest is amortized on a straight-line basis over the requisite service period. Stock-based compensation expense is recognized net of actual forfeitures when they occur, as an increase to additional paid-in capital in the consolidated balance sheets and in selling, general and administrative or research and development expenses in the consolidated statements of operations and comprehensive (loss) income. All stock-based compensation costs are recorded in the consolidated statements of operations and comprehensive (loss) income based upon the underlying employee’s role within the Company. Income Taxes The Company accounts for income taxes under the asset and liability method, which requires, among other things, that deferred income taxes be provided for temporary differences between the tax basis of the Company’s assets and liabilities and their financial statement reported amounts. In addition, deferred tax assets are recorded for the future benefit of utilizing net operating losses and research and development credit carryforwards and are measured using the enacted tax rates and laws that will be in effect when such items are expected to reverse. A valuation allowance is provided against deferred tax assets unless it is more likely than not that they will be realized. 96 Table of Contents The Company records uncertain tax positions on the basis of a two-step process whereby (i) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more-likely-than-not recognition threshold, it recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits within the income tax expense line in the accompanying consolidated statements of operations and comprehensive (loss) income. Any accrued interest and penalties related to uncertain tax positions will be reflected as a liability in the consolidated balance sheets. On July 4, 2025, H.R.1, commonly referred to as the One Big Beautiful Bill Act (“OBBBA”), was enacted in the United States. The legislation includes a broad range of tax reform provisions, including extension and modification of certain key Tax Cuts and Jobs Act provisions (both domestic and international), and provisions permitting accelerated tax deductions for qualified property and research expenditures. The legislation contains multiple effective dates, with certain provisions that became effective in 2025 and others to be implemented through 2027. The enactment of the OBBBA did not have a material impact on the Company’s effective income tax rate or cash tax position. Net (Loss) Income Per Share The Company only has one class of shares. Basic net (loss) income per share is computed by dividing the net (loss) income by the weighted average number of shares of common stock outstanding during the period, without consideration for potentially dilutive shares of common stock. Diluted net (loss) income per share is computed by dividing the net (loss) income by the weighted-average shares of common stock and potentially dilutive securities outstanding during the period using the treasury stock and if-converted methods, unless their inclusion would have been anti-dilutive. For purposes of the diluted net loss per share calculation, warrants, convertible notes and common stock options were considered as potentially dilutive securities. Since the Company was in a loss position for the year ended December 31, 2025, basic net loss per share is the same as diluted net loss per share as the inclusion of all potentially dilutive shares of common stock was anti-dilutive, while the year ended December 31, 2024, contained dilutive securities that were included in the calculation of diluted net income per share. Basic and diluted net loss per share for the year ended December 31, 2025 was calculated as follows (in thousands, except share and per share amounts): ​ ​ ​ ​ ​ Year ended December 31, 2025 ​ ​ ​ ​ ​ ​ ​ Net loss ​ $ ( 39,222 ) Weighted average shares of common stock outstanding, basic and diluted ​ 9,921,587 Net loss per share, basic and diluted ​ $ ( 3.95 ) Basic and diluted net income per share for the year ended December 31, 2024 were calculated as follows (in thousands, except share and per share amounts): ​ ​ ​ ​ Year ended December 31, 2024 ​ ​ ​ ​ ​ Net income ​ $ 42,005 Weighted average shares of common stock outstanding, basic ​ 540,360 Net income per share, basic ​ ​ 77.74 Weighted average shares of common stock outstanding, diluted ​ ​ 575,945 Net income per share, diluted ​ $ 72.93 ​ 97 Table of Contents The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted average shares outstanding because such securities have an anti-dilutive impact (in shares): ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ ​ 2025 ​ 2024 Warrants ​ 3,807,911 ​ 55,403 Common stock options and restricted stock units ​ 853,712 ​ 88,999 Convertible notes ​ 23,155,011 ​ 399,128 ​ ​ 27,816,634 ​ 543,530 ​ Contingencies The Company may be, from time to time, a party to various disputes and claims arising from normal business activities. The Company continually assesses litigation to determine if an unfavorable outcome would lead to a probable loss or reasonably possible loss which could be estimated. The Company accrues for all contingencies at the earliest date at which the Company deems it probable that a liability has been incurred and the amount of such liability can be reasonably estimated. If the estimate of a probable loss is a range and no amount within the range is more likely than another, the Company accrues the minimum of the range. In the cases where the Company believes that a reasonably possible loss exists, the Company discloses the facts and circumstances of the litigation, including an estimable range, if possible. Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures . This update requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. ASU 2023-09 is effective for public entities with annual periods beginning after December 15, 2024, with early adoption permitted. The Company adopted the provisions of ASU 2023-09 for the year ended December 31, 2025, and applied the amendments prospectively. See Note 8 Income Taxes for more information. Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses , which is intended to improve financial reporting by requiring disaggregated disclosure of certain costs and expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026 and for interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted, and may be applied on either a prospective or retrospective basis. The Company is currently evaluating the impact of this guidance on its consolidated financial statements. In December 2025, the FASB issued ASU No. 2025-11 Interim Reporting (Topic 270), which clarifies interim disclosure requirements and enhances clarity in the application of Topic 270. ASU No. 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years. Early adoption is permitted. The amendments of this ASU can be applied prospectively or retrospectively. The Company is currently evaluating the impact of this guidance on its consolidated financial statements. Note 3. Public Offering On January 6, 2025, the Company entered into an underwriting agreement with Aegis Capital Corp. (“Aegis” or the “Underwriter”) pursuant to which the Company agreed to sell and issue, in an underwritten public offering (the “Offering”) 555,571 Common Units, each consisting of (i) one (1) share of common stock, (ii) one (1) Series A Registered common warrant to purchase one (1) share of common stock per warrant (the “Series A Warrants”) at an exercise price of $ 45.00 (the “Exercise Price”) and (iii) one (1) Series B Registered common warrant to purchase one (1) share of common stock per warrant (the “Series B Warrants” and together with the Series A Warrants, the “Warrants”) at an Exercise Price of $ 45.00 . 98 Table of Contents The closing of the Offering occurred on January 7, 2025. The Company received net proceeds of approximately $ 18.3 million from the Offering, after deducting the offering expenses payable by the Company, including the Underwriter’s fees and expenses. The Company intends to use the net proceeds from the Offering for general corporate purposes, including working capital. The Series A Warrants were exercisable beginning on February 24, 2025, the date of approval by stockholders of the Company (the “Stockholder Approval Date” or the “Initial Exercise Date”), and expire in February 2030, the sixty ( 60 ) month anniversary of the Initial Exercise Date. The Series B Warrants were exercisable beginning on the Initial Exercise Date and expire in August 2027, on the thirty ( 30 ) month anniversary of the Initial Exercise Date. Upon issuance, the Warrants had an initial exercise price of $ 45.00 , which was reset on the eleventh trading date after the Stockholder Approval Date (the “Reset Date”). Prior to the Stockholder Approval Date, the Warrants had a floor price of $ 20.23 , and following stockholder approval, the Warrants had a floor price of $ 8.06 . The reset price was the greater of (i) the lowest single trading day volume-weighted average price (“VWAP”) of the Company’s common stock during the reset period and (ii) the floor price, as defined in the agreement. On February 24, 2025, the Company held a special stockholder meeting, at which stockholders voted, among other matters, to authorize stockholder approval of the Warrants within the context of the agreements for such Warrants. As such, as of February 24, 2025, the Warrants became exercisable. The stock price on the Reset Date was below the floor price following the Stockholder Approval Date, and as such, the exercise price was reset to $ 8.06 . On February 24, 2025, the following proposals were approved at a special meeting of shareholders: ● An amendment to the Company’s certificate of incorporation to increase the number of authorized shares of our common stock, par value $ 0.0001 (the “common stock”) from 500,000,000 to 1,040,000,000 ; ● Discretionary authority granted to the Company’s board of directors to (i) amend the Company’s certificate of incorporation to combine outstanding shares of the Company’s common stock into a lesser number of outstanding shares at a specific ratio within a range of one -for-five (1-for-5) to a maximum of a one -for-one hundred fifty (1-for-150), with the exact ratio to be determined by our board of directors in its sole discretion; and (ii) effect the reverse stock split, if at all, within one year of the date the proposal is approved by stockholders; ● Authorized shares of common stock underlying the warrants and certain provisions of the warrants issued in connection with a public offering that was consummated on January 7, 2025. Additionally, the Company granted Aegis a 45 -day option to purchase additional shares of common stock and/or Warrants of (i) up to 15.0 % of the number of shares of common stock sold in the offering, (ii) up to 15.0 % of the number of Series A Warrants sold in the offering and (iii) up to 15.0 % of the number of Series B Warrants sold in the offering. The purchase price per additional share of common stock is equal to the public offering price of one Common Unit (less $0.01 allocated to each full Warrant), less the underwriting discount. The purchase price per additional Warrant is $ 0.01 . On January 7, 2025, Aegis exercised its over-allotment option with respect to 83,334 Series A Warrants and 83,334 Series B Warrants. The holders of Series A Warrants can effect a cashless exercise if there is no effective registration statement at the time of exercise. The number of common shares to be issued would be calculated as VWAP minus exercise price of the Series A Warrants multiplied by the number Series A Warrants to be cashlessly exercised. The holders of Series B Warrants may effect an alternative cashless exercise whether or not an effective registration statement is available for the issuance of shares. In such event, the number of shares to be issued would be calculated as the number of Series B Warrants to be cashlessly exercised multiplied by a factor of 3.0 . During the year ended December 31, 2025, certain holders of the Series B Warrants exercised 3,502,982 Series B Warrants, in accordance with the alternative cashless exercise provision in the Series B Warrants, resulting in the issuance of 10,508,946 shares of common stock of the Company. There were no exercises of Series A Warrants for the year ended December 31, 2025. The fair value of the warrants exercised on the respective exercise dates for the year ended December 31, 2025 was $ 7.0 million. There were no Series A Warrants exercised during the year ended December 31, 2025. As of December 31, 2025, there were 3,565,245 and 62,263 units of Series A and Series B Warrants outstanding, respectively. 99 Table of Contents On the date of issuance, the Company recognized a loss on issuance of $ 75.6 million, which reflects the fair value of the warrants in excess of the proceeds received. For the year ended December 31, 2025, the Company recognized $ 65.0 million of income related to the change in fair value of the exercised Series B Warrants. For the year ended December 31, 2025, the Company recognized $ 17.7 million of income related to the change in fair value of the remaining outstanding Series A Warrants, $ 1.1 million of income related to the change in fair value of the remaining outstanding Series B Warrants, and $ 1.2 million of income due to the decrease in fair value related to private warrants primarily from the decrease in stock price used in the fair value calculation. Refer to Note 6 Fair Value Measurements for additional information. Note 4. Private Placement Financing Securities Purchase Agreement On November 12, 2025, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain investors (the “Investors”) whereby the Company agreed to issue and sell to the Investors in a private placement (the “PIPE Financing”): (i) shares (the “PIPE Shares”) of its common stock, par value $ 0.0001 per share, (ii) pre-funded warrants (the “PIPE Pre-Funded Warrants”) to purchase shares of common stock, (iii) warrants (the “PIPE Warrants”) to purchase shares of common stock, and (iv) True-Up Warrants (as defined below) to purchase shares of common stock. The purchase price paid by the Investors was $ 0.9116 per Share (or $ 0.9115 per pre-funded warrant in lieu of shares), the closing price of the Company’s stock on November 12, 2025. The first closing of the PIPE Financing occurred on November 18, 2025 (the “First Closing”). At the First Closing, the Company issued 1,964,905 PIPE Pre-Funded Warrants in exchange for cash of $ 1.8 million. The Second Closing of the PIPE Financing occurred on January 27, 2026. Following the Second Closing and the consummation of the Exchange, the Company has agreed to issue to each Investor that purchases all securities contemplated to be purchased by it pursuant to the Securities Purchase Agreement, a warrant (the “True-Up Warrant)” to purchase the number of shares of common stock necessary for the Investor’s Post-Exchange Investment Percentage (as defined in the Securities Purchase Agreement) following the issuance of the Exchange Shares (defined below) to be equal to the Investor’s Pre-Exchange Investment Percentage (as defined in the Securities Purchase Agreement) (rounded down to the nearest whole share of common stock), provided, however, that in no event shall the number of shares of common stock issuable under an Investor’s True-Up Warrant exceed the total number of shares or pre-funded warrant shares (as defined below) issued or issuable to an Investor pursuant to the Securities Purchase Agreement. Subject to the terms and conditions therein, the Securities Purchase Agreement also grants to the Investors, until such time as the earlier of (i) the date that no Warrants remain outstanding and (ii) the 18 -month anniversary of the Second Closing, a right to participate in any financing not registered under the Securities Act and involving the issuance by the Company of common stock or common stock equivalents for cash. Terms of the Pre-Funded Warrants, Warrants and True-Up Warrants The pre-funded warrants are being offered in lieu of shares of common stock and each pre-funded warrants is exercisable for one share of common stock at an exercise price of $ 0.0001 per share. The pre-funded warrants are immediately exercisable after issuance and may be exercised at any time until all of the pre-funded warrants are exercised in full. Each Warrant is exercisable for the number of shares or pre-funded warrants purchased by each Investor under the Securities Purchase Agreement (but excluding any shares issuable upon the exercise of the True-Up Warrants), at an exercise price of $ 1.09392 per share and may only be exercised for cash. The warrants are immediately exercisable after issuance and may be exercised at any time until the five-year anniversary of the Second Closing. Each True-Up Warrant is exercisable for one share of common stock at an exercise price of $ 0.0001 per share. The True-Up Warrants are immediately exercisable after issuance and may be exercised at any time until all of the True-Up Warrants are exercised in full. The exercise prices and the number of shares issuable upon exercise of the pre-funded warrants, Warrants and True-Up Warrants are subject to customary adjustments in the case of stock dividends, stock splits, pro rata distributions, and similar events in respect of the common stock. In addition, the number of shares of the common stock underlying, and the exercise price of, the Warrants is subject to full ratchet antidilution protection and standard adjustments in the event of a share split, reverse share split, share dividend, 100 Table of Contents share combination recapitalization or other similar transaction involving the common stock; provided, however, that in no event will the exercise price of the Warrants equal less than $ 0.30387 per share of common stock. Following approval of the PIPE Financing at the special meeting of the shareholders and the consummation of the Exchange, the Second Closing occurred on January 27, 2026 (the “Second Closing”). At the Second Closing, the Company issued 4,616,924 PIPE Pre-Funded Warrants, 6,581,829 PIPE Warrants and 6,581,829 True-Up Warrants to the Investors for gross proceeds of $ 4.2 million. In connection with the First Closing, the Company determined that the PIPE Financing included derivative liabilities to issue a variable number of warrants at a future date, and as such, recorded a derivative liability for the tranche right obligation to issue pre-funded warrants, PIPE Warrants, and True-Up Warrants with a fair value in excess of the cash proceeds to be received upon the Second Closing. For the First Closing, proceeds were allocated to the derivative liability based on the fair value as of grant date of $ 12.4 million. As the fair value of the tranche right obligation is greater than the proceeds received, the Company recognized a loss on derivative liability issued of $ 10.6 million. Additionally, the subsequent changes in fair value of the derivative liability was a loss of $ 2.5 million and was recorded in the consolidated statement of operations and comprehensive (loss) income for the year ended December 31, 2025. Note 5. Daewoong Convertible Notes On March 19, 2024, the Company entered into a subscription agreement with Daewoong (the “Subscription Agreement”) relating to the sale and issuance by the Company of senior secured convertible notes (each, a “2024 Convertible Note” and together, the “Existing Notes”) in the principal amount of up to $ 15.0 million, which are convertible into shares of the Company’s common stock, subject to certain conditions and limitations set forth in each Convertible Note. Each Convertible Note contains customary events of default, accrues interest at an annual rate of 15.79 % and has a maturity date that is three years from the funding date, unless earlier repurchased, converted or redeemed in accordance with its terms prior to such date. Pursuant to the terms of the Subscription Agreement, on March 24, 2024, the Company issued and sold to Daewoong one Convertible Note in the principal amount of $ 5.0 million, and on April 12, 2024, the Company issued and sold to Daewoong one Convertible Note in the principal amount of $ 10.0 million. On March 19, 2024, the Company entered into a Fourth Amendment to the License Agreement (the “License Agreement Amendment”) with Daewoong, which amends that certain License and Supply Agreement, by and between the Company and Daewoong, dated December 20, 2019, as previously amended on July 29, 2022, January 8, 2023 and April 24, 2023 (the “License Agreement”). Pursuant to the terms of the License Agreement Amendment, the License Agreement will terminate if, over any six month period, (a) the Company ceases to commercialize ABP-450 in certain territories specified in the License Agreement and (b) the Company ceases to advance any clinical studies of ABP-450 in such territories. The License Agreement Amendment also provides that, in the event that the License Agreement is terminated for the foregoing reasons, Daewoong will have the right to purchase all Know-How (as defined in the License Agreement) related to ABP-450 for a price of $ 1.00 (the “Termination Purchase Right”). The Termination Purchase Right will terminate and expire upon Daewoong’s sale of 50 % of its common stock, including common stock held by its affiliates and common stock that would be issued upon an Automatic Conversion or Optional Conversion (as defined in the Existing Notes). On November 12, 2025, the Company entered into a binding term sheet (the “Term Sheet”) with Daewoong relating to the exchange (the “Exchange”) of the outstanding senior secured convertible notes of the Company held by Daewoong (the “Existing Notes”). On December 15, 2025, the Company entered into an Exchange Agreement (the “Exchange Agreement”) with Daewoong consistent with the terms of the Term Sheet pursuant to which the Existing Notes held by Daewoong would be exchanged for (i) newly issued shares of common stock of the Company equal to (x) the principal and accrued interest of the Existing Notes as of the closing of the Exchange less (y) the principal amount of the New Convertible Note (as defined below), divided by $ 1.00 , and then multiplied by 1.3 (and rounded down to the nearest whole share of common stock) and/or pre-funded warrants to purchase shares of common stock (the “Pre-Funded Warrants”) in lieu of any shares of common stock that would result in Daewoong’s beneficial ownership of common stock exceeding 49.99 % (the “Exchange Shares”), (ii) a new senior secured convertible note for $ 1.5 million (the “New Convertible Note”), and (iii) warrants to purchase up to 8 million shares of common stock at an exercise price of $ 1.09392 per share (the “Daewoong Warrant”). At the closing of the Exchange, the number of Exchange Shares issued was 11,918,380 shares of common stock and 11,236,631 Daewoong Pre-Funded Warrants. Upon the closing of the Exchange, the Existing Notes were immediately and automatically terminated. The Daewoong Warrants, which contain the same terms as the PIPE Warrants, are exercisable at an exercise price of $ 1.09392 per share and may only be exercised for cash. The Daewoong Warrants are immediately exercisable after issuance and may be exercised at any time until the five-year anniversary of the Second Closing. The Exchange was approved at the special meeting of shareholders on January 21, 2026. 101 Table of Contents The Exchange Agreement provided that the Company nominate one designee of Daewoong to the Company’s board of directors to serve as a Class III director at the 2026 annual meeting of stockholders, of which the director designee is currently Seongsoo Park. Mr. Park currently serves on the Company’s board of directors and is scheduled for renomination at the 2026 annual meeting of stockholders. During the year ended December 31, 2025, the Company recognized $ 22.9 million of loss related to the increase in the fair value of the 2024 Daewoong Convertible Note. As of December 31, 2025, the principal amount outstanding under the 2024 Daewoong Convertible Note was $ 15.0 million, with an estimated fair value of $ 34.6 million. New Convertible Note The New Convertible Note issued on January 21, 2026, contains customary events of default, accrue interest at an annual rate of 15.79 % payable in cash at maturity and has a maturity date of April 12, 2030 (the “New Maturity Date”), unless earlier converted or redeemed in accordance with its terms prior to such date. The Company may not prepay the New Convertible Note or accrued interest prior to the New Maturity Date. If, prior to the New Maturity Date, the Company consummates a bona-fide third-party financing after the issuance of the New Convertible Note in the form of common stock or any securities convertible into, or exchangeable or exercisable for, common stock (subject to certain exceptions as described in the New Convertible Note), in one or more transactions or a series of related and substantially similar and simultaneous transactions at the same purchase price from third parties unaffiliated with Daewoong and its affiliates, for aggregate gross cash proceeds to the Company of at least $ 30.0 million (a “Qualified Financing”), then, upon written notice thereof to Daewoong by the Company, on the closing date of such Qualified Financing, the New Convertible Note will automatically convert in whole, without any further action by Daewoong, into a number of shares of common stock or pre-funded warrants equal to: (i) one and three tenths ( 1.3 ) multiplied by (ii) the quotient of (a) the principal amount of the New Convertible Note and all accrued and unpaid interest to be converted divided by (b) the per share price of the common stock sold in the Qualified Financing. If, prior to the New Maturity Date, the Company provides (i) written notice to Daewoong that it has publicly announced the submission of a Biologics License Application filing for ABP-450 as a biosimilar to Botox® (onabotulinumtoxinA) or (ii) a written notice that the Company has consummated a Change of Control (as defined in the New Convertible Note), Daewoong will have the right for thirty ( 30 ) days following receipt of either such notice, at Daewoong’s option (the “Optional Conversion”), to convert all (but not less than all) of the remaining outstanding portion of the New Convertible Note (subject to any limitations under the rules of NYSE American) into an amount of shares of common stock or pre-funded warrants equal to: (i) one and three tenths ( 1.3 ) multiplied by (ii) the quotient of (a) the principal amount of the New Convertible Note and all accrued and unpaid interest to be converted divided by (b) the volume-weighted average trading per share price of common stock over the five (5) trading days prior to the Company’s receipt of Daewoong’s written notice of exercise of the Optional Conversion. The New Convertible Note includes a covenant that restrict the Company and AEON Sub’s ability to issue debt securities senior or pari passu to such New Convertible Note without Daewoong’s prior written consent. The New Convertible Note also include a covenant that restricts the Company and AEON Sub’s ability to issue debt securities junior to such New Convertible Note except as expressly permitted under a security agreement to be entered into between the Company, AEON Sub and Daewoong in connection with closing of the Exchange. In connection with issuing the New Convertible Note, the Company and AEON Sub granted a first-priority security interest on substantially all of their respective assets, other than certain permitted liens described in the New Convertible Note. Upon the occurrence and continuation of an event of default, Daewoong will be entitled to, among other things, foreclose on the assets that are the subject of the security interest. The Pre-Funded Warrants and common stock Warrants Under the Exchange Agreement and the New Convertible Note, pre-funded warrants may be issued in lieu of shares of common stock and each pre-funded warrant is exercisable for one share of common stock at an exercise price of $ 0.0001 per share. The pre-funded warrants are immediately exercisable after issuance and may be exercised at any time until all of the pre-funded warrants are exercised in full. The Daewoong Warrants are substantially identical to the PIPE Warrants, which are exercisable at an exercise price of $ 1.09392 per share and may only be exercised for cash. The Daewoong Warrants are immediately exercisable after issuance and may be exercisable at any time until the five-year anniversary of issuance. 102 Table of Contents The exercise prices and the number of shares issuable upon exercise of the pre-funded warrants and the common stock warrant are subject to customary adjustments in the case of stock dividends, stock splits, pro rata distributions, and similar events in respect of the common stock. In addition, the number of shares of the common stock underlying, and the exercise price of, the Daewoong Warrants will be subject to full ratchet antidilution protection and standard adjustments in the event of a share split, reverse share split, share dividend, share combination recapitalization or other similar transaction involving the common stock. Note 6. Fair Value Measurements The Company measures fair value based on the prices that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The carrying value of cash, cash equivalents, accounts payable and accrued liabilities approximate fair value because of the short-term nature of those instruments. The following are other financial assets and liabilities that are measured at fair value on a recurring basis. Convertible Notes at Fair Value Due to certain embedded features within the convertible notes, the Company elected the fair value option to account for its convertible notes, including any paid-in-kind principal and interest, and the embedded features. During the years ended December 31, 2025 and 2024, the Company recognized $ 22.9 million and $( 3.3 ) million, respectively, of expense (income) related to the increase (decrease) in fair value of the convertible notes. As of December 31, 2025, the principal amount outstanding under the convertible notes was $ 15.0 million, with an estimated fair value of $ 34.6 million. See Note 5 Daewoong Convertible Notes for more information. The fair value of the convertible notes was determined based on Level 3 inputs using a scenario-based analysis that estimated the fair value of the convertible notes based on the probability-weighted present value of expected future investment returns, considering each of the possible outcomes available to the noteholders, including various qualified financings, corporate transaction and dissolution scenarios. The significant unobservable input assumptions that can significantly change the fair value included (i) the discount rates, (ii) the timing of payments, and (iii) the probability of certain settlement scenarios. At December 31, 2025, the significant assumptions applied in the valuation of the convertible notes included discount rates ranging from 15 % to 53 %, an underlying stock price of $ 1.10 , and probability weightings of 95 % for approval of the Exchange transaction and 5 % for a hold-to-maturity scenario. At December 31, 2024, the valuation of the convertible notes was based on significant assumptions, including a 60 % discount rate and probability-weighted outcomes for the hold-to-maturity , qualified financing , and change-in-control scenarios. Contingent Consideration and Contingent Founder Shares As part of the Merger, each share of Priveterra Class B common stock (“Founder Shares”), par value $ 0.0001 per share, issued and outstanding immediately prior to the Merger converted into one share of common stock totaling 95,842 common shares. In addition, at the Merger, certain holders of common stock in Old AEON (the “Participating Stockholders”) will be issued a portion of up to 222,653 additional shares of common stock. Therefore, the Contingent Founder Shares and Participating Stockholder shares (together, “Contingent Consideration Shares”) contain certain contingent provisions as further discussed below. Pursuant to the terms of the amended Sponsor Support Agreement, 50 % of the Founder Shares (i.e., 47,921 Founder Shares) (the “Contingent Founder Shares”) were unvested and subject to the restrictions and forfeiture provisions set forth in this Sponsor Support Agreement, of which 13,980 of such Contingent Founder Shares were forfeited in the second quarter of 2025 as the result of a vesting event not occurring. The remaining 50 % of the Founder Shares were not subject to such restrictions and forfeiture provisions. The remaining Contingent Founder Shares shall vest, and shall become free of the provisions as follows: ● 13,890 of the Contingent Founder Shares (the “CD BLA Contingent Founder Shares”) shall vest upon the achievement of the conditions for the issuance of the CD BLA Contingent Consideration Shares on or prior to the CD BLA Outside Date; and 103 Table of Contents ● 20,141 of the Contingent Founder Shares (the “Episodic/Chronic Migraine Contingent Founder Shares”) shall vest upon the earlier of (x) the achievement of the conditions for the issuance of the Episodic Migraine Contingent Consideration Shares on or before the Episodic Migraine Outside Date and (y) the achievement of the conditions for the issuance of the Chronic Migraine Contingent Consideration Shares on or before the Chronic Migraine Outside Date. The Priveterra Sponsor, LLC (the “Sponsor”) has agreed not to vote the Contingent Founder Shares during any period of time that such Contingent Founder Shares are subject to vesting. As part of the overall consideration paid in connection with the Merger, certain holders of common stock in Old AEON (the “Participating AEON Stockholders”) will be issued a portion of up to 222,653 additional shares of common stock, as follows: ● 55,659 shares of common stock, in the aggregate, if, on or before November 30, 2026 (as it may be extended, the “CD BLA Outside Date”), the Company shall have received from the FDA acceptance for review of the BLA submitted by the Company for the treatment of cervical dystonia (such 55,659 shares of common stock, the “CD BLA Contingent Consideration Shares”); ● 55,659 shares of common stock, in the aggregate, if, on or before June 30, 2029 (as it may be extended, the “Episodic Migraine Outside Date”), the Company shall have received from the FDA acceptance for review of the BLA submitted by the Company for the treatment of episodic migraine (such 55,659 shares of common stock, the “Episodic Migraine Contingent Consideration Shares”); provided that in the event the satisfaction of the conditions for the issuance of the Episodic Migraine Contingent Consideration Shares occurs prior to the satisfaction of the conditions for the issuance of the Chronic Migraine Contingent Consideration Shares, then the number of Episodic Migraine Contingent Consideration Shares shall be increased to 152,998 shares of common stock; and ● 97,339 shares of common stock, in the aggregate, if, on or before June 30, 2028 (as it may be extended, the “Chronic Migraine Outside Date”, and together with the Migraine Phase 3 Outside Date, the CD BLA Outside Date and the Episodic Migraine Outside Date, the “Outside Dates”), the Company shall have received from the FDA acceptance for review of the BLA submitted by AEON for the treatment of chronic migraine (such 97,339 shares of common stock, the “Chronic Migraine Contingent Consideration Shares”); provided that in the event that the number of Episodic Migraine Contingent Consideration Shares is increased to 152,998 , then the number of Chronic Migraine Contingent Consideration Shares shall be decreased to zero and no Contingent Consideration Shares will be issued in connection with the satisfaction of the conditions to the issuance of the Chronic Migraine Contingent Consideration Shares. ● In the event that the Company licenses any of its products (except in connection with migraine or cervical dystonia indications) to a third-party licensor for distribution in the U.S. market (a “Qualifying License”) prior to the satisfaction of (x) the conditions for the issuance of the Episodic Migraine Contingent Consideration Shares and (y) the conditions for the issuance of the Chronic Migraine Contingent Consideration Shares, then upon the entry of AEON into such Qualifying License, 27,992 shares of common stock shall become due and payable to Participating Stockholders and the number of Episodic Migraine Contingent Consideration Shares and (A) the number of Episodic Migraine Contingent Consideration Shares shall be reduced by 13,996 or by 27,992 and (B) the number of Chronic Migraine Contingent Consideration Shares shall be reduced by 13,996 , but not below zero . The Company classifies the Contingent Consideration as a liability on the consolidated balance sheets and remeasures at each reporting period with changes to fair value recorded to the consolidated statements of operations and comprehensive (loss) income. The Company utilized the Probability-Weighted Expected Return Method (PWERM) model to value the contingent consideration based on earnout milestones, probability of forfeiture and success scenarios. For the years ended December 31, 2025 and 2024, the Company recognized $ 3.5 million and $ 100.8 million, respectively, of income related to the change in fair value of contingent consideration on the consolidated statements of operations and comprehensive (loss) income, and relates to the change in probabilities of achieving certain scenarios following the clinical results released in the second quarter of 2024 and changes in the Company’s stock 104 Table of Contents price during the period. As of December 31, 2025 and 2024, the contingent consideration liability was $ 42 thousand and $ 3.5 million, respectively. Warrants Public and Private Placement Warrants related to the Closing Upon the Merger, 201,112 warrants consisting of 127,788 public warrants sold in Priveterra’s initial public offering and 73,334 warrants issued in a concurrent private placement, were outstanding. Public warrants related to the Closing Each whole public warrant entitles the holder to purchase one share of the Company’s common stock at a price of $ 828.00 per share. The public warrants became exercisable 30 days after the completion of the Merger, and will expire on July 21, 2028, the five-year anniversary of the completion of the Merger, or earlier upon redemption or liquidation. Warrant holders may, until such time as there is an effective registration statement and during any period when the Company has failed to maintain an effective registration statement covering the shares of the Company’s common stock issuable upon exercise of the warrants, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exception. When exercised on a cashless basis, the number of shares received per warrant is capped at 1 .0. The Company may call the public warrants for redemption for cash: ● in whole and not in part; ● at a price of $ 0.72 per warrant; ● upon not less than 30 days ’ prior written notice of redemption to each warrant holder (the “ 30-day redemption period ” ); ● if, and only if, there is an effective registration statement under the Securities Act of 1933 covering the issuance of the shares of common stock issuable upon exercise of the warrants, and a current prospectus relating thereto, available through the 30-day redemption period; and ● if, and only if, the closing price of the Company's common stock equals or exceeds $ 1,296.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 -trading day period ending three business days before the Company sends to the notice of redemption to the warrant holders. The Company may also call the public warrants for redemption: ● in whole and not in part; ● at $ 7.20 per warrant upon a minimum of 30 days ’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares to be determined by reference to a table in the Warrant Agreement, based on the redemption date and the “ fair market value ” (as defined in the Warrant Agreement ) of common stock except as otherwise described below; and ● if, and only if, the closing price of the Company ’ s common stock equals or exceeds $ 720.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 -trading day period ending three business days before the Company sends to the notice of redemption to the warrant holders. Private placement warrants related to the Closing Each private placement warrant was identical to the public warrants initially sold by Priveterra in the IPO, except that the private placement warrants, so long as they are held by the Sponsor or its permitted transferees, (i) will not be redeemable by the Company and (ii) may be exercised by the holders on a cashless basis. Warrant exercises On March 29, 2024, the Company delivered notice of redemptions to warrant holders with a redemption date of April 29, 2024 for a cashless redemption of the Company’s outstanding public warrants. The number of shares of common stock that each exercising warrant holder received by virtue of the cashless exercise (instead of paying the $ 828.00 per Public Warrant cash exercise price) was 105 Table of Contents calculated in accordance with the terms of the Warrant Agreement. Any remaining unexercised public warrants on the redemption date were cancelled and the public warrant holders received the redemption price of $ 7.20 for each public warrant. During the year ended December 31, 2024, an aggregate of 142,829 warrants were exercised on a cashless basis for 27,310 shares of common stock, with an impact to additional paid in capital of $ 15.0 million. Additionally, the Company paid $ 21,000 in April 2024 related to the cancellation of the remaining 2,881 public warrants on the redemption date. A summary of activity of the Company’s issued and outstanding public warrants for the year ended December 31, 2025 is as follows: ​ ​ ​ ​ ​ ​ ​ ​ Public ​ Private ​ ​ ​ ​ ​ Issued and Outstanding, January 1, 2025 ​ — ​ 55,403 Number of warrants issued ​ — ​ — Number of warrants exercised ​ — ​ — Number of warrants cancelled ​ — ​ — Issued and Outstanding, December 31, 2025 ​ — ​ 55,403 ​ ​ ​ ​ ​ Issued and Outstanding, January 1, 2024 ​ 127,778 ​ 73,334 Number of warrants exercised ​ ( 124,897 ) ​ ( 17,931 ) Number of warrants cancelled ​ ( 2,881 ) ​ — Issued and Outstanding, December 31, 2024 ​ — ​ 55,403 ​ ​ ​ ​ ​ The warrants are accounted for as a liability with changes in the fair value recorded to the consolidated statement of operations and comprehensive (loss) income. The fair value of the warrants using the Black-Scholes model (Level 3) was de minimus as of December 31, 2025 and $ 1.2 million as of December 31, 2024. For the years ended December 31, 2025 and 2024, the income from the change in fair value was $ 1.2 million and $ 0.3 million, respectively. Series A and Series B Warrants The measurement of fair value for the Series A and Series B Warrants were determined utilizing a Black-Scholes model considering all relevant assumptions at the date of issuance of January 7, 2025 and at December 31, 2025. The fair value on grant date was recorded as a liability on the consolidated balance sheets and changes in fair value are recognized at each reporting period on the consolidated statement of operations and comprehensive (loss) income. The table below summarizes the significant assumptions: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ January 7 ​ 2025 ​ 2025 ​ ​ Series A ​ ​ Series B ​ ​ Series A ​ ​ Series B ​ ​ (Level 3) ​ ​ (Level 3) ​ ​ (Level 3) ​ ​ (Level 3) Stock Price $ 1.10 ​ $ 1.10 ​ $ 15.91 ​ $ 15.91 Exercise Price ​ 8.06 ​ ​ 8.06 ​ ​ 45.00 ​ ​ 45.00 Expected volatility 160.00 % ​ ​ 200.00 % ​ 99.00 % ​ ​ 130.00 % Risk-free interest rate 3.60 % ​ ​ 3.50 % ​ 4.36 % ​ ​ 4.22 % Expected life (in years) 4.02 ​ ​ 1.52 ​ 5.00 ​ ​ 2.50 Expected dividend yield — ​ ​ — ​ — ​ ​ — ​ The grant date fair values for these warrants were $ 94.0 million, comprised of $ 20.7 million and $ 73.3 million for Series A and Series B Warrants, respectively, on January 7, 2025 and was recorded as a liability as of the grant date due to certain exercise price adjustment provisions occurring in connection with future events. Proceeds were allocated to the warrant liabilities based on the fair value as of grant date of the warrants of $ 94.0 million. As the fair value of the warrants issued were greater than the proceeds received, the Company recognized a loss on issuance of common shares and the warrants of $ 75.6 million. 106 Table of Contents A summary of activity for the Company’s issued and outstanding Series A and Series B Warrants for the year ended December 31, 2025 is as follows: ​ ​ ​ ​ ​ ​ ​ ​ Series A ​ Series B ​ ​ ​ ​ ​ Issued and Outstanding, January 1, 2025 ​ — ​ — Number of warrants issued ​ 3,565,245 ​ 3,565,245 Number of warrants exercised ​ — ​ ( 3,502,982 ) Issued and Outstanding, December 31, 2025 ​ 3,565,245 ​ 62,263 ​ Summary of Recurring Fair Value Measurements The following details the Company’s recurring measurements for assets and liabilities at fair value on the consolidated balance sheets as of December 31, 2025 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Convertible Notes ​ ​ Warrant Liabilities ​ ​ Contingent Consideration ​ ​ Derivative Liability ​ ​ ​ (Level 3) ​ ​ (Level 3) ​ ​ (Level 3) ​ ​ (Level 3) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, January 1, 2025 ​ $ 11,689 ​ $ 1,187 ​ $ 3,541 ​ $ — Issuance of derivative liability ​ ​ — ​ ​ — ​ ​ — ​ ​ 12,438 Issuance of warrants ​ ​ — ​ ​ 94,064 ​ ​ — ​ ​ — Change in fair value ​ ​ 22,911 ​ ​ ( 84,934 ) ​ ​ ( 3,499 ) ​ ​ 2,441 Warrant cashless exercise ​ ​ — ​ ​ ( 7,041 ) ​ ​ — ​ ​ — Termination of forward purchase agreements ​ ​ — ​ ​ — ​ ​ — ​ ​ — Balance, December 31, 2025 ​ $ 34,600 ​ $ 3,276 ​ $ 42 ​ $ 14,879 The following details the Company’s recurring measurements for assets and liabilities at fair value on the consolidated balance sheets as of December 31, 2024 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Convertible Notes ​ ​ Warrant Liabilities ​ ​ Contingent Consideration ​ ​ Embedded Forward Purchase Agreement and Make Whole Derivative ​ ​ ​ (Level 3) ​ ​ (Level 3) ​ ​ (Level 3) ​ ​ (Level 3) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance, January 1, 2024 ​ $ — ​ $ 1,447 ​ $ 104,350 ​ $ 41,043 Issuance of convertible notes ​ ​ 15,000 ​ ​ — ​ ​ — ​ ​ — Change in fair value ​ ​ ( 3,311 ) ​ ​ 14,719 ​ ​ ( 100,809 ) ​ ​ ( 663 ) Warrant cashless exercise ​ ​ — ​ ​ ( 14,979 ) ​ ​ — ​ ​ — Termination of forward purchase agreements ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 40,380 ) Balance, December 31, 2024 ​ $ 11,689 ​ $ 1,187 ​ $ 3,541 ​ $ — ​ ​ Note 7. Commitments and Contingencies Operating Leases In December 2021, the Company entered into a three-year non-cancellable lease for office space. The lease was extended for an additional five years in March 2024. The lease does not include variable or contingent lease payments. An operating lease asset and liability are recognized based on the present value of the remaining lease payments discounted using the Company’s incremental borrowing rate. Lease expense is recognized on a straight-line basis over the lease term. 107 Table of Contents The following table summarizes supplemental balance sheet information related to the operating lease as of December 31, 2025 (in thousands): ​ ​ ​ ​ ​ Minimum lease payments by fiscal year ​ ​ ​ ​ ​ ​ 2026 ​ $ 297 ​ 2027 ​ 307 ​ 2028 ​ ​ 318 ​ 2029 ​ ​ 329 ​ Thereafter ​ ​ — ​ Total future minimum lease payments ​ 1,251 ​ Less: Imputed interest ​ ( 106 ) ​ Present value of lease payments ​ 1,145 ​ Less: Current portion (included in other accrued expenses) ​ ( 252 ) ​ Noncurrent operating lease liability ​ $ 893 ​ Operating lease right-of-use asset ​ $ 1,052 ​ Remaining lease term in years ​ 4.0 ​ Discount rate ​ 4.3 % ​ The following table summarizes supplemental disclosures of operating cost and cash flow information related to operating leases for the years ended December 31, 2025 and 2024 (in thousands): ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 31, ​ 2025 ​ 2024 Cost of operating leases $ 289 ​ $ 260 Cash paid for operating leases ​ 175 ​ ​ 319 ​ Daewoong License and Supply Agreement On December 20, 2019, the Company entered the Daewoong Agreement, pursuant to which Daewoong agreed to manufacture and supply ABP-450 and grant the Company an exclusive license for therapeutic indications to import, distribute, promote, market, develop, offer for sale and otherwise commercialize and exploit ABP-450 in the United States, the European Union, the United Kingdom, Canada, Australia, Russia, the Commonwealth of Independent States and South Africa (collectively the “covered territories”). Pursuant to the terms of the Exchange Agreement, for the full satisfaction of all obligations under the Existing Notes, in January 2026 after approval of the Exchange by stockholders, the Company issued to Daewoong (i) 11,918,380 newly issued shares of common stock and 11,236,631 Daewoong Pre-Funded Warrants to purchase shares of common stock (the “Exchange Shares”), (ii) a new senior secured convertible note in a principal amount of $ 1.5 million (the “New Convertible Note”), and (iii) warrants to purchase up to 8 million shares of common stock at an exercise price of $ 1.09392 per share, which resulted in Daewoong becoming a related party. Prior to this transaction, Daewoong’s beneficial ownership was approximately 1 %. In connection with the Exchange, on January 21, 2026, the Company entered into a Fifth Amendment to the License and Supply Agreement (the “License Agreement Amendment”) with Daewoong, which amends the License and Supply Agreement, by and between the Company and Daewoong, dated December 20, 2019, as amended on July 29, 2022, January 8, 2023, April 24, 2023 and March 19, 2024. Pursuant to the terms of the License Agreement Amendment, the definition of “Notes” reflects the Exchange and the Termination Purchase Right (as defined in the License Agreement Amendment) will terminate and expire upon Daewoong’s sale of 50 % of its common stock, including common stock held by its affiliates and common stock that would be issued upon conversion of the New Convertible Note. Daewoong supplies the Company with ABP-450 at an agreed-upon transfer price, with no milestone or royalty payments and no minimum purchase requirements. Daewoong is responsible for all costs related to the manufacturing of ABP-450, including costs related to the operation and upkeep of its manufacturing facility, and the Company is responsible for all costs related to obtaining regulatory approval, including clinical expenses, and commercialization of ABP-450. The Company’s exclusivity is subject to its exercise of commercially reasonable efforts to: (i) achieve all regulatory approvals necessary for ABP-450 to be marketed in the 108 Table of Contents territory for therapeutic indications and (ii) commercialize ABP-450 in the territory for therapeutic indications. During the term of the Daewoong Agreement, the Company cannot purchase, sell or distribute any competing products in a covered territory or sell ABP-450 outside a covered territory. The initial term of the Daewoong Agreement is from December 20, 2019 to the later of (i) the fifth anniversary of approval from the relevant governmental authority necessary to market and sell ABP-450 or (ii) December 20, 2029, and automatically renews for unlimited additional three-year terms, provided the Daewoong Agreement is not earlier terminated. The Daewoong Agreement will terminate upon written notice by either the Company or Daewoong upon a continuing default that remains uncured within 90 days (or 30 days for a payment default) by the other party, or without notice upon the bankruptcy or insolvency of the Company. The Company has recorded $ 0.4 million and $ 0.3 million as liabilities in accrued expenses and accounts payable on the consolidated balance sheets as of December 31, 2025 and 2024, respectively, for ABP-450 supplies and analytical testing performed by Daewoong. For the years ended December 31, 2025 and 2024, the Company recorded $ 0.2 million and $ 0.3 million, respectively, of research and development expenses on the consolidated statement of operations and comprehensive (loss) income. Legal Proceedings The Company, from time to time, is involved in various litigation matters or regulatory encounters arising in the ordinary course of business that could result in unasserted or asserted claims or litigation. Other than as described below, the Company is not subject to any currently pending legal matters or claims that would have a material adverse effect on its accompanying financial position, results of operations or cash flows. On September 18, 2023, Odeon Capital Group LLC (“Odeon”) filed a lawsuit against the Company in the Supreme Court of the State of New York, alleging that the Company failed to pay Odeon’s deferred underwriting fee of $ 1.25 million, and seeking monetary damages for the full amount of its claimed underwriting fee, punitive damages, attorneys’ fees and other amounts, totaling approximately $ 1.7 million, which was recorded in other accrued expenses on the consolidated balance sheets as of December 31, 2024. On October 31, 2025, the Company entered into a settlement agreement with Odeon to settle the lawsuit in exchange for $ 1.0 million in cash, 267,455 shares of common stock and 125,000 warrants to purchase shares of common stock with an exercise price of $ 2.00 and a three-year term. The Company recorded a gain on settlement of $ 0.4 million to selling, general and administrative expenses on the consolidated statement of operations and comprehensive (loss) income for the year ended December 31, 2025. On November 20, 2025, Aegis Capital Corp. (“Aegis”) filed a lawsuit against the Company in the Supreme Court of the State of New York, alleging that the Company failed to honor a right of first refusal (the “ROFR”) in Aegis’s favor when AEON raised capital through a self-directed private placement in public equity (“PIPE”). In the complaint, Aegis claimed that AEON misappropriated $ 1.59 million by not engaging Aegis as its underwriter or bookrunner in the PIPE and seeks punitive damages and attorneys' fees. Aegis was unsuccessful in its attempts to obtain both a temporary restraining order and permanent injunction. AEON filed a motion to dismiss in January 2026, relying upon New York precedent that indicates ROFRs are not operative when a company does not engage any banking partner. Oral argument with respect to the motion to dismiss is scheduled for April 2026. In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future, but have not yet been made. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. See Note 2 Summary of Significant Accounting Policies for additional information. Note 8. Income Taxes The Company’s (loss) income before income taxes for the periods presented in the statement of operations was entirely generated from its U.S. operations. As a result of its continuing taxable losses, the Company had no provision for income taxes for the years ended December 31, 2025 and 2024. As of December 31, 2025 and 2024, the Company had federal net operating loss (“NOL”) carryforwards of $ 140.5 million and $ 112.1 million, respectively, of which $ 48.4 million and $ 48.4 million, respectively, which will begin to expire in 2036, and $ 92.1 million and $ 63.7 million, respectively, have indefinite lives. The Company had state NOLs of $ 141.1 million and $ 140.5 million as of December 31, 2025 and 2024, respectively, which will begin to expire in 2034. As of December 31, 2025 and 2024, the Company 109 Table of Contents has federal research and development (“R&D”) credit carryforwards of $ 7.1 million and $ 6.9 million, respectively, which will begin to expire in 2039. As of December 31, 2025 and 2024, the Company also has California R&D credit carryforwards of $ 5.2 million and $ 5.0 million, respectively, which have an indefinite carryforward period. ​ In general, if the Company experiences a greater than 50 percentage point aggregate change in ownership of certain significant stockholders over a three-year period (a “Section 382 ownership change”), utilization of its pre-change NOL carryforwards and the R&D credit carryforwards is subject to an annual limitation under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, and similar state laws. The annual limitation generally is determined by multiplying the value of the Company’s stock at the time of such ownership change, subject to certain adjustments, by the applicable long-term tax-exempt rate. Such limitations may result in expiration of a portion of the NOL carryforwards and R&D credit carryforwards before utilization and may be material. As of December 31, 2025, the Company has not determined to what extent a potential ownership change will impact the annual limitation that may be placed on the Company’s utilization of its NOL carryovers and R&D credit carryforwards. Due to the existence of the valuation allowance, limitations created by ownership changes, if any, will not impact the Company’s effective tax rate. The components of deferred tax assets and liabilities were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ 2025 ​ 2024 Deferred tax assets: ​ ​ ​ ​ ​ Accrued compensation ​ $ 256 ​ $ 283 Accrued other expense ​ 153 ​ 469 Stock compensation ​ 2,022 ​ 1,941 Start-up costs and other intangibles ​ 6,643 ​ 10,834 Net operating losses ​ 41,973 ​ 35,966 Lease liability ​ 240 ​ 378 Other deferred assets ​ ​ 18 ​ 24 Capitalized research and development expenses ​ 8,087 ​ 11,090 ​ ​ 59,392 ​ 60,985 Less: valuation allowance ​ ( 59,137 ) ​ ( 59,560 ) Total deferred tax assets ​ 255 ​ 1,425 Deferred tax liabilities: ​ ​ ​ ​ Depreciation ​ ( 34 ) ​ ( 53 ) ROU Asset ​ ( 221 ) ​ ( 384 ) Convertible notes ​ — ​ ( 988 ) Total deferred tax liabilities ​ ( 255 ) ​ ( 1,425 ) Net deferred income taxes ​ $ — ​ $ — 110 Table of Contents ​ The table below provides the updated requirements of ASU 2023-09 for 2025. The effective income tax rate for the year ended December 31, 2025 differs from the statutory federal income tax rate as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ ​ 2025 ​ Tax expense (benefit) at statutory federal rate ​ $ ( 8,237 ) 21.0 % State and local income tax, net of federal income tax effect ​ ​ — — ​ Foreign tax effects ​ ​ — — ​ Effect of changes in tax laws or rates enacted in the current period ​ ​ — — ​ Effect of cross-border tax laws ​ ​ — — ​ Tax credits ​ ​ — — ​ Changes in valuation allowance ​ ​ 3,238 ( 8.3 ) ​ Nontaxable and nondeductible Items ​ ​ ​ ​ ​ Stock compensation ​ ​ 261 ( 0.7 ) ​ Officers compensation ​ ​ 468 ( 1.2 ) ​ Contingent consideration ​ ​ ( 1,951 ) 4.9 ​ Forward purchase agreements ​ ​ ( 735 ) 1.9 ​ Private placement liabilities ​ ​ 2,748 ( 7.0 ) ​ Convertible notes ​ ​ 4,116 ( 10.5 ) ​ Other ​ ​ 92 ( 0.1 ) ​ Total tax provision and effective tax rate ​ $ — — % ​ As previously disclosed for the year ended December 31, 2024, prior to the adoption of ASU 2023-09, the effective income tax rate differs from the statutory federal income tax rate as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 Income tax at statutory rate ​ 21.0 % Convertible notes ​ — ​ Contingent consideration ​ ( 50.4 ) ​ Forward purchase agreements ​ 9.8 ​ Private placement liabilities ​ — ​ Warrants ​ 7.4 ​ Stock compensation ​ 1.0 ​ Officers compensation ​ 1.4 ​ Transaction costs ​ 0.5 ​ Change in valuation allowance ​ 9.3 ​ Other ​ — ​ Effective tax rate ​ 0.0 % ​ A reconciliation of unrecognized tax benefits at the beginning and end of 2025 and 2024 is as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ 2025 ​ 2024 Balance, beginning of year ​ $ 16,115 ​ $ 14,670 Increases due to current year tax positions ​ 297 ​ 1,445 Decreases due to prior year tax positions ​ — ​ — Balance, end of year ​ $ 16,412 ​ $ 16,115 ​ The Company has considered the amounts and probabilities of the outcomes that can be realized upon ultimate settlement with the tax authorities and determined unrecognized tax benefits should be established of $ 16.4 million and $ 16.1 million as of December 31, 2025 and 2024, respectively. The Company’s effective income tax rate would not be impacted if the unrecognized tax benefits are recognized. 111 Table of Contents The Company’s policy is to recognize interest expense and penalties related to income tax matters as a component of income tax expense. There were no accrued interest and penalties associated with uncertain tax positions as of December 31, 2025. The Company’s tax returns for all years since inception are open for audit. For the year ended December 31, 2025, the amount of income taxes paid, net of refunds received, to the State of California was $ 3 thousand . The Company measures deferred tax assets and liabilities using enacted tax rates that will apply in the years in which the temporary differences are expected to be recovered or paid. On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law in the United States, introducing a wide array of tax reform measures. These include extensions and modifications to certain provisions originally enacted under the Tax Cuts and Jobs Act. Key changes include the immediate expensing of domestic research and development costs and the reinstatement of 100 percent bonus depreciation. For the year ending December 31, 2025, the impact from the OBBBA provisions did not impact the effective tax rate. The Company will continue to evaluate the OBBBA provisions for their potential impact on future periods. Note 9. Common stock On February 24, 2025, the Company held a special stockholder meeting, at which stockholders voted, among other matters, to amend the Company’s Certificate of Incorporation, as amended and restated, to increase the number of authorized common stock from 500,000,000 to 1,040,000,000 shares of common stock at par value of $ 0.0001 per share. The holders of common stock are entitled to receive dividends whenever funds are legally available, when and if declared by the Company’s Board of Directors. As of December 31, 2025, there have been no cash dividend declared to date. Each share of common stock is entitled to one vote. On February 24, 2025, following a special stockholder meeting, the board of directions of the Company (the “Board”) approved the filing of a Certificate of Amendment to the Certificate of Incorporation to effect a reverse stock split at a split ratio of 1 -for-72 (the “Reverse Stock Split”). As a result of the Reverse Stock Split, each 72 pre-split shares of common stock outstanding was automatically combined into one new share of common stock without any action on the part of the holders. The Reverse Stock Split affected all of the Company’s stockholders uniformly and did not affect any stockholder’s percentage ownership interests in the Company. No fractional shares were issued in connection with the Reverse Stock Split. In lieu of fractional shares, any person who would otherwise be entitled to a fractional share of common stock as a result of the reclassification and combination following the effective time of the Reverse Stock Split (after taking into account all fractional shares of common stock otherwise issuable to such holder) instead received a number of shares rounded up to the nearest whole share. Proportional adjustments were made to the number of shares of common stock issuable upon exercise or conversion of the Company’s outstanding equity awards and warrants, as well as the applicable exercise price, except in cases where the applicable agreement provides otherwise. All share and per share amounts in the accompanying consolidated financial statements have been retroactively adjusted to reflect the Reverse Stock Split for all periods presented. Common Stock Reserved The table below summarizes the Company’s reserved common stock for further issuance as of December 31, 2025 and 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ ​ ​ 2025 ​ 2024 ​ ​ ​ ​ ​ ​ ​ Stock options issued and outstanding 158,005 98,971 ​ Restricted stock units (unvested) 695,707 25,613 ​ Shares available for future issuance under the stock incentive plans and employee stock purchase plan ​ 328,642 25,818 ​ Warrants ​ 3,807,911 55,403 ​ Pre-funded warrants ​ 1,964,905 ​ — ​ Contingent consideration ​ 208,657 222,653 ​ Convertible notes ​ 23,155,011 ​ 399,128 ​ Total common stock reserved 30,318,838 827,586 ​ ​ 112 Table of Contents ATM Offering of Common Stock On August 14, 2024, the Company entered into an “at-the-market” sales agreement with Leerink Partners relating to the ATM, pursuant to which the Company may offer and sell, from time to time at its sole discretion, shares of common stock, registered pursuant to a shelf registration statement on Form S-3 (No. 333-281562) (as amended and supplemented, the “Registration Statement”) that the SEC declared effective on August 21, 2024, having aggregate gross proceeds of up to $ 50.0 million through Leerink Partners as sales agent. Any sales by us pursuant to the Registration Statement, including any sales pursuant to the ATM, are subject to any limits imposed under applicable law, including General Instructions I.B.1 and I.B.6 of Form S-3. Under the ATM, Leerink Partners is entitled to commission at a rate equal to 3.0 % of the gross proceeds from sales of shares of common stock under the ATM. For the years ended December 31, 2025 and 2024, there were 218,419 shares and 2,241 shares issued under the ATM for net proceeds of approximately $ 0.2 million and $ 0.2 million, respectively. As of December 31, 2025, the cumulative shares issued under the ATM were 220,660 shares net proceeds of approximately $ 0.3 million and approximately $ 49.7 million of common stock remains available to be sold under the ATM. The Company may cancel its at-the-market program at any time upon prior notice, pursuant to its terms. 2023 Employee Stock Purchase Plan (“ESPP”) The 2023 ESPP assists eligible employees in acquiring a stock ownership interest of the Company’s common stock in consideration of the participating employees’ continued services. Eligible employees will be entitled to purchase, by means of payroll deductions, limited amounts of the Company’s common stock at a discount during periodic offering periods. There were 6,780 shares initially reserved for issuance under the 2023 ESPP, which shall automatically increase on January 1 of each calendar year beginning and including January 1, 2024 and ending on and including January 1, 2033, by an amount equal to the lesser of (i) 1.0 % of the total number of shares of common stock issued and outstanding on January 1 of the year in which such increase is to occur, or (ii) such smaller number of shares of common stock as may be established by the Board of Directors. As of December 31, 2025, there were 19,419 shares available for issuance. There have been no shares issued under the 2023 ESPP. ​ Note 10. Share-based Compensation Stock Incentive Plans 2019 Incentive Award Plan In June 2019, Old AEON established the 2019 Incentive Award Plan (the “2019 Incentive Award Plan”), as amended from time to time, that provides for the granting of incentive and nonqualified stock options, restricted stock units (“RSU”), restricted stock and stock appreciation rights to its employees, members of the Board of Directors and non-employee consultants. Stock options granted generally expire ten years after their original date of grant and generally vest between three years to four years with 25 % vesting on the first anniversary of the date of grant and then monthly vesting after that. Stock options granted to a 10 % stockholder are exercisable up to five years from the date of grant. Restricted stock awards granted generally become fully vested between one to three years . In connection with the Merger, the Company assumed the 2019 Incentive Award Plan and all options and RSU awards that were outstanding immediately prior to the Merger were converted into substantially similar awards covering shares of the Company’s common stock based on a conversion ratio of approximately 1.078 to 1 share. Additionally, the exercise price for the awards were repriced to $ 720.00 for all options. The fair value of the replacement awards that were vested based on the value immediately prior to the Merger were included as purchase consideration. The remaining value of the replacement awards is recognized as compensation expense over the remaining vesting period. Prior to the consummation of the Merger, a total of 237,500 shares of ABP Sub Inc. common stock were available for issuance under the 2019 Incentive Award Plan. Following the effective date of the 2023 Plan, in the event that an outstanding award expires or is cancelled for any reason, the shares allocable to the unexercised or cancelled portion of such award from the 2019 Incentive Award Plan will be added back to the shares of common stock available for issuance under the 2023 Plan. Certain RSU awards contain performance-based vesting criteria based on the achievement of the same milestones as the contingent consideration (see Note 6 Fair Value Measurements for additional information). Upon designation of a probable milestone, the Company expenses the proportionate RSU’s over the vesting term, calculated as the period from the date the milestone was determined to be probable and the expected achievement date of the milestone. 113 Table of Contents The following table summarizes stock option activity in 2025 under 2019 Incentive Award Plan: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ ​ Average ​ ​ ​ Number of ​ Exercise ​ ​ ​ Shares ​ Price ​ Outstanding, January 1, 2025 ​ 47,955 ​ $ 720.00 ​ Options granted — ​ ​ — ​ Options forfeited — ​ ​ — ​ Outstanding, December 31, 2025 47,955 ​ $ 720.00 ​ Exercisable, December 31, 2025 44,707 ​ $ 720.00 ​ ​ As of December 31, 2025 and 2024, the weighted average remaining contractual life of options outstanding and options exercisable was 5.0 years and 6.0 years. During the years ended December 31, 2025 and 2024, the Company recognized $ 1.6 million and $ 2.9 million, respectively, of share-based compensation expense related to stock options granted. As of December 31, 2025, total unrecognized compensation expense related to nonvested stock options was $ 0.2 million, which is expected to be recognized over the weighted-average remaining requisite service period of 1 month . The following table summarizes restricted stock units activity in 2025 under the 2019 Incentive Award Plan: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ ​ Average ​ ​ ​ Number of ​ Grant Date ​ ​ ​ Shares ​ Fair Value ​ Outstanding, January 1, 2025 11,398 ​ $ 780.48 ​ Granted — ​ — ​ Vested ( 1,639 ) ​ ​ — ​ Forfeited ​ ( 408 ) ​ ​ — ​ Outstanding, December 31, 2025 9,351 ​ $ 780.48 ​ ​ During the year ended December 31, 2025 and 2024, the Company recognized $ 1.3 million and $ 1.3 million, respectively, of share-based compensation expense related to restricted stock units granted, excluding restricted stock units with earnout vesting criteria. For the restricted stock units with earnout vesting criteria, the Company recognized $( 0.7 ) million and $ 0.3 million of (gain) expense for the years ended December 31, 2025 and 2024, respectively. During the third quarter of 2025, the Company determined that the earnout vesting criteria was no longer probable, as such, the Company reversed $ 1.0 million of share-based compensation expense related to the restricted stock units with earnout criteria. As of December 31, 2025, total unrecognized compensation expense related to nonvested restricted stock units, excluding restricted stock units with earnout vesting criteria, was $ 1.7 million, which is expected to be recognized over the weighted-average remaining requisite service period of 12 months . As of December 31, 2025, the unrecognized compensation expense related to the restricted stock units with the earnout criteria, due to the vesting criteria not being probable, was $ 4.7 million, and will be recognized when the milestones are determined to be probable over the RSUs vesting term, calculated as the period from the date the milestone was determined to be probable and the expected achievement date of the milestone. As of December 31, 2025, there were 408 restricted stock units with earnout vesting criteria that were forfeited due to milestone deadline not achieved. AEON Biopharma Inc. 2023 Incentive Award Plan In connection with the Merger, the Company’s Board adopted, and its stockholders approved, the 2023 Plan, which became effective upon the consummation of the Merger, that provides for the granting of nonqualified stock options, restricted stock and stock appreciation rights to employees, members of the Board and non-employee consultants. On December 2, 2025, the Company’s Board adopted an amendment and restatement of the 2023 Incentive Award Plan (as amended and restated, the “2023 Plan”), and on January 21, 2026, our stockholders approved the 2023 Plan. The 2023 Plan will remain in effect until January 21, 2036, the tenth anniversary of the date the Company’s stockholders approved the 2023 Plan, unless earlier terminated. Stock options granted generally expire ten 114 Table of Contents years after their original date of grant and generally vest between three years to four years with equal installments vesting on each anniversary of the grant date, subject to continued service through the applicable vesting date. The aggregate number of shares of the Company’s common stock available for issuance under the 2023 Incentive Award Plan is equal to (a) 17,846,923 shares of common stock and (b) any shares which, as of the original effective date of the 2023 Incentive Award Plan, are subject to an award outstanding under the 2019 Incentive Award Plan (each, a “Prior Plan Award”), and which, on or following the original effective date of the 2023 Incentive Award Plan, become available for issuance under the 2023 Plan as provided in the 2023 Plan. In addition, the number of shares of common stock available for issuance under the 2023 Plan will be annually increased on January 1 of each calendar year beginning in 2027 and ending in 2033 by an amount equal to the lesser of (i) 5 % of the number of fully-diluted number of shares outstanding on the final day of the immediately preceding calendar year or (ii) such other number of shares as is determined by the Board. Any shares issued pursuant to the 2023 Plan may consist, in whole or in part, of authorized and unissued common stock, treasury common stock or common stock purchased on the open market. As of December 31, 2025, there were 40,398 shares of common stock available for issuance under the 2023 Plan. The following table summarizes stock options activity in 2025 under the 2023 Plan: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ ​ Average ​ ​ ​ Number of ​ Exercise ​ ​ ​ Shares ​ Price ​ ​ ​ ​ ​ ​ ​ ​ Outstanding, January 1, 2025 51,016 ​ $ 242.14 ​ Options granted — ​ ​ — ​ Options forfeited — ​ ​ — ​ Outstanding, December 31, 2025 51,016 ​ $ 242.14 ​ Exercisable, December 31, 2025 38,748 ​ $ — ​ ​ There were no options granted in 2025. The weighted average per share fair value of options granted in 2024 was $ 135.50 . The weighted average remaining contractual life of options outstanding and options exercisable as of December 31, 2025 and 2024 was 8.5 years and 9.5 years, respectively. During the years ended December 31, 2025 and 2024, the Company recognized $ 2.7 million and $ 1.6 million, respectively, of share-based compensation expense related to stock options granted. As of December 31, 2025 total unrecognized compensation expense related to nonvested stock options was $ 2.6 million, which is expected to be recognized over the weighted-average remaining requisite service period of 7 months . The following table summarizes restricted stock units activity in 2025 under the 2023 Plan: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ Average ​ ​ Number of ​ Grant Date ​ ​ Shares ​ Fair Value ​ ​ ​ ​ ​ ​ Outstanding, January 1, 2025 14,215 ​ $ 60.05 Granted — ​ ​ — Vested — ​ — Forfeited — ​ ​ — Outstanding, December 31, 2025 14,215 ​ $ 60.05 ​ During the years ended December 31, 2025 and 2024, the Company recognized $ 0.4 and $ 0.1 million, respectively of share-based compensation expense related to restricted stock units granted. As of December 31, 2025, total unrecognized compensation expense related to nonvested restricted stock units was $ 0.3 million which is expected to be recognized over the weighted-average remaining requisite service period of 8 months. 115 Table of Contents AEON Biopharma Inc. 2025 Employment Inducement Incentive Award Plan Effective April 19, 2025, the Board adopted the 2025 Employment Inducement Incentive Award Plan (the “Inducement Plan”) and, subject to the adjustment provisions of the Inducement Plan, reserved 1,000,000 shares of the Company’s Class A common stock for issuance pursuant to equity awards granted under the Inducement Plan. The Inducement Plan provides for the grant of equity-based awards, including non-statutory stock options, restricted stock units, restricted stock, stock appreciation rights, performance shares and performance stock units, and its terms are substantially similar to the 2023 Plan. In accordance with the Company Guide, awards under the Inducement Plan may only be made to individuals not previously employees or non-employee directors of the Company (or following such individuals’ bona fide period of non employment with the Company), as an inducement material to the individuals’ entry into employment with the Company or being rehired following a bona fide period of interruption of employment by the Company. The Inducement Plan was adopted without stockholder approval pursuant to the applicable provisions of the Company Guide. As of December 31, 2025, there were 268,825 shares of common stock available for issuance under the Inducement Plan. For the year ended December 31, 2025 there were 59,034 stock options issued, with weighted average exercise price of $ 0.41 per share. The weighted average fair value of options granted as of December 31, 2025 was $ 0.37 per share. The weighted average remaining contractual life of options outstanding and options exercisable as of December 31, 2025 was 9.3 years. During the year ended December 31, 2025, the Company recognized de minimus amounts of share-based compensation expense related to stock options granted. As of December 31, 2025, total unrecognized compensation expense related to nonvested stock options was $ 18 thousand, which is expected to be recognized over the weighted average remaining requisite service period of 40 months . For the year ended December 31, 2025, there were 672,141 restricted stock units issued, with weighted averaged grant date fair value of $ 0.65 per share. During the year ended December 31, 2025, the Company recognized de minimus amounts of share-based compensation expense related to restricted stock units granted. As of December 31, 2025, total unrecognized compensation expense related to nonvested restricted stock units was $ 0.4 million, which is expected to be recognized over the weighted-average remaining requisite service period of 44 months . Share-based Compensation Expense and Valuation Information The Company accounts for the measurement and recognition of compensation expense for all share-based awards based on the estimated fair value of the awards. The fair value of share-based awards is amortized on a straight-line basis over the requisite service period. The Company records share-based compensation expense net of actual forfeitures. During the years ended December 31, 2025 and 2024, the Company recognized $ 5.3 million and $ 4.7 million, respectively, of share-based compensation expense in selling, general and administrative expenses, and $ 1.6 million and $ 1.5 million, respectively, in research and development expenses in the accompanying consolidated statements of operations and comprehensive (loss) income. The fair value of stock options under the 2019 Plan and 2023 Plan was estimated using the following assumptions: ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ December 31, ​ ​ ​ 2025 ​ 2024 ​ ​ ​ ​ ​ ​ ​ Expected volatility ​ 123 % 47 % – 87 % ​ Risk-free interest rate ​ 3.9 % 3.7 % – 4.3 % ​ Expected life (in years) ​ 6.25 5.27 – 6.25 ​ Expected dividend yield ​ — — ​ ​ Fair Value of the Underlying common stock. The fair value of the stock price is the closing price for the Company’s common stock as reported on the NYSE American. Expected Life . The expected life is calculated using the simplified method as the Company does not have sufficient historical information to provide a basis for the estimate. The simplified method is based on the average of the vesting tranches and the contractual life of each grant. Expected Volatility . The expected volatility is estimated based on a study of selected publicly traded peer companies as the Company does not have sufficient trading history for its common stock. The Company selected the peer group based on similarities in 116 Table of Contents industry, stage of development, size and financial leverage with the Company’s principal business operations. For each grant, the Company measured historical volatility over a period equivalent to the expected life. Risk-free Interest Rate . The risk-free interest rate is based on the yield available on U.S. Treasury zero-coupon issues whose term is similar in duration to the expected life of the respective stock option. Expected Dividend Yield . The Company has not paid and does not anticipate paying any dividends on its common stock in the foreseeable future. Accordingly, the Company has estimated the dividend yield to be zero. Note 11. Subsequent Events The Company has evaluated subsequent events for recognition and remeasurement purposes as of and for the year ended December 31, 2025. After review and evaluation, management has concluded that there were no material subsequent events as of the date that the financial statements were available to be issued, except as discussed below. Special Meeting of Shareholders On January 21, 2026, the following proposals were approved at a special meeting of shareholders: ● the shares to be issued in connection with the Second Closing of the PIPE Financing, specifically the (i) issuance and sale of 4,616,924 shares of common stock, or pre-funded warrants to purchase common stock in lieu of the shares, (ii) warrants to purchase an aggregate of 6,581,829 shares of common stock and (iii) shares issuable upon exercise of True-Up Warrants. ● the Exchange of the outstanding senior secured convertible notes of the Company held by Daewoong pursuant to an exchange agreement, dated December 15, 2025, by and between the Company and Daewoong for (i) Exchange Shares, (ii) a new senior secured convertible note in a principal amount of $ 1.5 million and (iii) a warrant to purchase 8 million shares of common stock. ● the amendment of the 2023 Plan to increase the number of shares of common stock authorized for issuance thereunder. Exchange Agreement Following the approval of the Exchange in the special shareholder meeting on January 21, 2026, and pursuant to the terms of the Exchange Agreement, for the full satisfaction of all obligations under the Existing Notes, the Company issued to Daewoong (i) 11,918,380 newly issued shares of common stock and 11,236,631 pre-funded warrants to purchase shares of common stock (the “Exchange Shares”), (ii) a new senior secured convertible note in a principal amount of $ 1.5 million (the “New Convertible Note”), and (iii) warrants to purchase up to 8 million shares of common stock at an exercise price of $ 1.09392 per share. The New Convertible Note contains customary events of default, accrue interest at an annual rate of 15.79 % payable in cash at maturity and will have a maturity date of April 12, 2030, unless earlier converted or redeemed in accordance with its terms prior to such date. The Company may not prepay the New Convertible Note or accrued interest prior to the New Maturity Date. ​ Amendment to License Agreement In connection with the Exchange, on January 21, 2026, the Company entered into the License Agreement Amendment with Daewoong, which amends the License and Supply Agreement, by and between the Company and Daewoong, dated December 20, 2019, as amended on July 29, 2022, January 8, 2023, April 24, 2023 and March 19, 2024. Pursuant to the terms of the License Agreement Amendment, the definition of “Notes” reflects the Exchange and the Termination Purchase Right (as defined in the License Agreement Amendment) will terminate and expire upon Daewoong’s sale of 50 % of its common stock, including common stock held by its affiliates and common stock that would be issued upon conversion of the New Convertible Note. Second Closing of the PIPE Financing Following the approval of the shares to be issued in the Second Closing and completion of the Exchange in January 2026, the Company received gross proceeds of $ 4.2 million and issued 4,616,924 PIPE Pre-Funded Warrants, 6,581,829 PIPE Warrants and 6,581,829 True-Up Warrants to the investors of the PIPE Financing. ​ 117 Table of Contents ATM Offering of Common Stock From January 1, 2026 through March 27, 2026, the Company issued 1,278,776 shares under the ATM for net proceeds of $ 1.7 million, approximately $ 47.9 million of common stock remained available to be sold under the ATM. ​ Cash-Settled Restricted Stock Unit In March 2026, the Company’s board of directors approved the modification of all cash-settled restricted stock units awards that were issued in May 2025 to be converted into stock-settled restricted stock units. The Company will assess the modification in accordance with ASC 718 Stock-based Compensation for the first quarter of 2026, the period in which the awards were modified. ​ 118 Table of Contents Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.