ARDELYX, INC. 10-Q

ITEM 1. FINANCIAL STATEMENTS ARDELYX, INC. CONDENSED BALANCE SHEETS (in thousands, except share and per share amounts) (Unaudited) September 30, 2025 December 31, 2024 Assets Current assets Cash and cash equivalents $ 42,715 $ 64,932 Short-term investments 199,990 185,168 Accounts receivable 76,610 57,705 Inventory 25,172 21,173 Prepaid commercial manufacturing 8,051 16,378 Prepaid expenses and other current assets 15,447 11,096 Total current assets 367,985 356,452 Property and equipment, net 2,069 1,495 Inventory, non-current 104,186 70,011 Right-of-use assets 5,152 2,380 Other assets 6,778 5,416 Total assets $ 486,170 $ 435,754 Liabilities and stockholders’ equity Current liabilities Accounts payable $ 18,390 $ 16,000 Accrued compensation and benefits 15,056 14,940 Current portion of operating lease liability 1,435 1,562 Deferred revenue 6,581 10,686 Accrued expenses and other current liabilities 41,927 34,642 Total current liabilities 83,389 77,830 Operating lease liability, net of current portion 4,038 1,023 Long-term debt 202,138 150,853 Deferred revenue, non-current 13,699 7,232 Deferred royalty obligation related to the sale of future royalties 28,626 25,527 Total liabilities 331,890 262,465 Commitments and contingencies (Note 14) Stockholders’ equity Common stock, $ 0.0001 par value; 500,000,000 shares authorized; 242,971,838 and 238,015,825 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively 24 24 Additional paid-in capital 1,100,664 1,058,548 Accumulated deficit ( 946,532 ) ( 885,340 ) Accumulated other comprehensive income 124 57 Total stockholders’ equity 154,280 173,289 Total liabilities and stockholders’ equity $ 486,170 $ 435,754 The accompanying notes are an integral part of these condensed financial statements. 2 Table of Contents ARDELYX, INC. CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) (in thousands, except share and per share amounts) Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 2025 2024 Revenues Product sales, net $ 105,515 $ 92,090 $ 263,406 $ 208,193 Product supply revenue — 5,322 6,439 7,461 Licensing revenue 25 20 5,065 56 Non-cash royalty revenue related to the sale of future royalties 4,789 809 7,195 1,776 Total revenues 110,329 98,241 282,105 217,486 Cost of goods sold Cost of product sales 2,662 1,715 8,247 4,133 Other cost of revenue 1,320 14,013 20,441 28,159 Total cost of goods sold 3,982 15,728 28,688 32,292 Operating expenses Research and development 18,067 15,310 48,671 38,651 Selling, general and administrative 83,612 64,970 250,822 182,618 Total operating expenses 101,679 80,280 299,493 221,269 Income (loss) from operations 4,668 2,233 ( 46,076 ) ( 36,075 ) Interest expense ( 5,796 ) ( 3,357 ) ( 14,343 ) ( 9,039 ) Non-cash interest expense related to the sale of future royalties ( 2,188 ) ( 1,924 ) ( 6,478 ) ( 5,202 ) Other income, net 2,449 2,282 6,667 6,766 Loss before provision for income taxes ( 867 ) ( 766 ) ( 60,230 ) ( 43,550 ) Provision for income taxes 102 43 962 231 Net loss $ ( 969 ) $ ( 809 ) $ ( 61,192 ) $ ( 43,781 ) Net loss per share of common stock - basic and diluted $ ( 0.00 ) $ ( 0.00 ) $ ( 0.25 ) $ ( 0.19 ) Shares used in computing net loss per share - basic and diluted 241,908,407 235,911,399 240,165,744 234,516,305 Comprehensive loss Net loss $ ( 969 ) $ ( 809 ) $ ( 61,192 ) $ ( 43,781 ) Unrealized gains (losses) on available-for-sale securities 162 286 67 ( 39 ) Comprehensive loss $ ( 807 ) $ ( 523 ) $ ( 61,125 ) $ ( 43,820 ) The accompanying notes are an integral part of these condensed financial statements. 3 Table of Contents ARDELYX, INC. CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (Unaudited) (in thousands, except shares) Three Months Ended September 30, 2025 Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive (Loss) Income Total Stockholders’ Equity Shares Amount Balance as of June 30, 2025 240,765,516 $ 24 $ 1,085,108 $ ( 945,563 ) $ ( 38 ) $ 139,531 Issuance of common stock under employee stock purchase plan 162,859 — 703 — — 703 Issuance of common stock upon exercise of options 860,811 — 2,111 — — 2,111 Issuance of common stock upon vesting of restricted stock units 1,182,652 — — — — — Stock-based compensation — — 12,742 — — 12,742 Unrealized gains on available-for-sale securities — — — — 162 162 Net loss — — — ( 969 ) — ( 969 ) Balance as of September 30, 2025 242,971,838 $ 24 $ 1,100,664 $ ( 946,532 ) $ 124 $ 154,280 Nine Months Ended September 30, 2025 Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Income Total Stockholders’ Equity Shares Amount Balance as of December 31, 2024 238,015,825 $ 24 $ 1,058,548 $ ( 885,340 ) $ 57 $ 173,289 Issuance of common stock under employee stock purchase plan 385,593 — 1,718 — — 1,718 Issuance of common stock for services 87,256 — 315 — — 315 Issuance of common stock upon exercise of options 1,641,801 — 3,566 — — 3,566 Issuance of common stock upon vesting of restricted stock units 2,841,363 — — — — — Stock-based compensation — — 36,517 — — 36,517 Unrealized gains on available-for-sale securities — — — — 67 67 Net loss — — — ( 61,192 ) — ( 61,192 ) Balance as of September 30, 2025 242,971,838 $ 24 $ 1,100,664 $ ( 946,532 ) $ 124 $ 154,280 4 Table of Contents Three Months Ended September 30, 2024 Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive (Loss) Income Total Stockholders’ Equity Shares Amount Balance as of June 30, 2024 235,401,398 $ 23 $ 1,036,244 $ ( 889,176 ) $ ( 101 ) $ 146,990 Issuance of common stock under employee stock purchase plan 226,297 — 1,189 — — 1,189 Issuance of common stock upon exercise of options 663,358 1 1,507 — — 1,508 Issuance of common stock upon vesting of restricted stock units 599,378 — — — — — Stock-based compensation — — 9,133 — — 9,133 Unrealized gains on available-for-sale securities — — — — 286 286 Net loss — — — ( 809 ) — ( 809 ) Balance as of September 30, 2024 236,890,431 $ 24 $ 1,048,073 $ ( 889,985 ) $ 185 $ 158,297 Nine Months Ended September 30, 2024 Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Shares Amount Balance as of December 31, 2023 232,453,190 $ 23 $ 1,012,773 $ ( 846,204 ) $ 224 $ 166,816 Issuance of common stock under employee stock purchase plan 479,609 — 2,227 — — 2,227 Issuance of common stock for services 40,549 — 257 — — 257 Issuance of common stock upon exercise of options 2,227,627 1 5,298 — — 5,299 Issuance of common stock upon vesting of restricted stock units 1,689,456 — — — — — Stock-based compensation — — 27,518 — — 27,518 Unrealized losses on available-for-sale securities — — — — ( 39 ) ( 39 ) Net loss — — — ( 43,781 ) — ( 43,781 ) Balance as of September 30, 2024 236,890,431 $ 24 $ 1,048,073 $ ( 889,985 ) $ 185 $ 158,297 The accompanying notes are an integral part of these condensed financial statements. 5 Table of Contents ARDELYX, INC. CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands) Nine Months Ended September 30, 2025 2024 Operating activities Net loss $ ( 61,192 ) $ ( 43,781 ) Adjustments to reconcile net loss to net cash used in operating activities Depreciation and amortization expense 2,138 1,548 Non-cash lease expense 1,590 2,973 Stock-based compensation 36,517 27,518 Non-cash interest expense 6,877 5,420 Non-cash royalty revenue related to the sale of future royalties ( 7,195 ) ( 1,776 ) Other, net ( 3,151 ) ( 3,577 ) Changes in operating assets and liabilities Accounts receivable ( 18,905 ) ( 31,164 ) Inventory ( 38,174 ) ( 35,671 ) Prepaid commercial manufacturing 8,327 6,497 Prepaid expenses and other assets ( 5,771 ) ( 5,759 ) Accounts payable 2,390 3,686 Accrued compensation and benefits 116 ( 1,056 ) Operating lease liabilities ( 1,474 ) ( 3,388 ) Accrued and other liabilities 12,111 19,695 Deferred revenue 2,362 4,216 Net cash used in operating activities ( 63,434 ) ( 54,619 ) Investing activities Proceeds from maturities and redemptions of investments 156,456 120,354 Purchases of investments ( 168,060 ) ( 96,634 ) Purchases of property and equipment ( 1,131 ) ( 418 ) Net cash (used in) provided by investing activities ( 12,735 ) 23,302 Financing activities Proceeds from 2022 Loan Agreement, net of costs 48,668 49,750 Proceeds from issuance of common stock under equity incentive and stock purchase plans 5,284 7,526 Net cash provided by financing activities 53,952 57,276 Net (decrease) increase in cash and cash equivalents ( 22,217 ) 25,959 Cash and cash equivalents at beginning of period 64,932 21,470 Cash and cash equivalents at end of period $ 42,715 $ 47,429 Supplementary disclosure of cash flow information Cash paid for interest $ 10,857 $ 6,962 Cash paid for income taxes $ 491 $ 272 Supplementary disclosure of non-cash activities Right-of-use assets obtained in exchange for lease obligations $ 4,362 $ 1,010 Issuance of common stock for services $ 315 $ 257 The accompanying notes are an integral part of these condensed financial statements. 6 Table of Contents ARDELYX, INC . NOTES TO CONDENSED FINANCIAL STATEMENTS (Unaudited) NOTE 1. NATURE OF OPERATIONS We are a biopharmaceutical company founded with a mission to discover, develop and commercialize innovative, first-in-class medicines that meet significant unmet medical needs. We developed a unique and innovative platform that enabled the discovery of new biological mechanisms and pathways to develop potent and efficacious therapies that minimize the side effects and drug-drug interactions frequently encountered with traditional, systemically absorbed medicines. The first molecule we discovered and developed was tenapanor, a minimally absorbed, first-in-class, oral, small molecule therapy. Tenapanor, branded as IBSRELA ® , is approved in the U.S. for the treatment of adults with IBS-C. Tenapanor, branded as XPHOZAH ® , is approved in the U.S. to reduce serum phosphorus in adults with CKD on dialysis as add-on therapy in patients who have an inadequate response to phosphate binders or who are intolerant of any dose of phosphate binder therapy. We operate in one business segment, which is the development and commercialization of biopharmaceutical products. Refer to Note 12. Segment Reporting for further discussion on our segment reporting. Basis of Presentation These condensed financial statements have been prepared in accordance with U.S. GAAP and pursuant to the requirements of the SEC for interim reporting. As permitted under those rules and regulations, certain footnotes or other financial information that are normally required by U.S. GAAP have been condensed or omitted. These condensed financial statements have been prepared on the same basis as our most recent annual financial statements and, in the opinion of management, reflect all normal and recurring adjustments necessary to present fairly our financial position, results of operations, changes in stockholders’ equity and cash flows for the interim periods presented. The accompanying condensed financial statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto included in our 2024 Form 10-K. The results for the three and nine months ended September 30, 2025 are not necessarily indicative of results to be expected for the entire year ending December 31, 2025, or for any other interim period or future year. Refer to the Summary of Abbreviated Terms at the end of this Quarterly Report on Form 10-Q for definitions of terms used throughout the document. Use of Estimates The preparation of financial statements requires management to make estimates, judgments and assumptions. The most significant assumptions are estimates used in our revenue gross-to-net accruals and other assumptions. Management bases its estimates on historical experience and on various other market-specific and relevant assumptions that management believes to be reasonable under the circumstances. Actual results could materially differ from those estimates. Recent Accounting Pronouncements Recent Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures . The ASU provides additional transparency within the income tax disclosures, primarily related to the rate reconciliation and income taxes paid information. The Company anticipates that the adoption of ASU 2023-09 will result in modifications to its income tax disclosures, including an enhanced effective tax rate reconciliation using both percentages and currency amounts, broken out into defined categories, with certain reconciling items further disaggregated by nature and jurisdiction to the extent those items exceed a specified threshold. In addition, the Company will disclose income taxes paid, net of refunds received disaggregated by jurisdiction if the amount is at least five percent of total income taxes paid, net of refunds received. The new disclosure requirements will be included in the Company’s Form 10-K for the fiscal year ending December 31, 2025 and will be applied retrospectively. In November 2024, the FASB issued ASU No. 2024-03, Income Statement (Topic 220) - Reporting Comprehensive Income - Expense Disaggregation Disclosures, Disaggregation of Income Statement Expenses , which requires public companies to disclose, in interim and annual reporting periods, additional information about certain expenses in the financial statements. The new disclosure requirements are effective for the Company’s annual periods beginning January 1, 2027, and interim periods beginning January 1, 2028, with early adoption permitted, and may be applied either prospectively or retrospectively. The Company is in the process of evaluating the impact of this new guidance on its disclosures. 7 Table of Contents NOTE 2. CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS The following table summarizes our cash, cash equivalents and short-term investments: September 30, 2025 December 31, 2024 Gross Unrealized Gross Unrealized (in thousands) Amortized Cost Gains Losses Fair Value Amortized Cost Gains Losses Fair Value Cash and cash equivalents Cash $ 9,155 $ — $ — $ 9,155 $ 16,282 $ — $ — $ 16,282 Money market funds 33,560 — — 33,560 48,650 — — 48,650 Total cash and cash equivalents 42,715 — — 42,715 64,932 — — 64,932 Short-term investments U.S. treasury securities $ 98,808 $ 66 $ ( 2 ) $ 98,872 $ 79,720 $ 58 $ ( 5 ) $ 79,773 U.S. government-sponsored agency bonds 27,100 32 — 27,132 45,960 29 ( 27 ) 45,962 Commercial paper 48,744 12 ( 7 ) 48,749 37,061 19 ( 15 ) 37,065 Corporate bonds 22,462 23 — 22,485 17,415 4 ( 6 ) 17,413 Asset-backed securities 2,752 — — 2,752 2,983 2 — 2,985 Yankee bonds — — — — 1,972 — ( 2 ) 1,970 Total short-term investments 199,866 133 ( 9 ) 199,990 185,111 112 ( 55 ) 185,168 Total cash, cash equivalents and investments $ 242,581 $ 133 $ ( 9 ) $ 242,705 $ 250,043 $ 112 $ ( 55 ) $ 250,100 Realized gains or losses have not been significant and are included in other income, net, in the condensed statements of operations and comprehensive loss. Unrealized losses as of September 30, 2025 and December 31, 2024 were not material. All of the short-term available-for-sale securities held as of September 30, 2025 and December 31, 2024 had contractual maturities of less than one year. We determined that none of our available-for-sale securities were other-than-temporarily impaired as of September 30, 2025 and December 31, 2024, and no investment was in a continuous unrealized loss position for more than one year. Therefore, we believe that it is more likely than not that the investments will be held until maturity or a forecasted recovery of fair value. Based on our procedures under the expected credit loss model, including an assessment of unrealized losses in our portfolio, we concluded that any unrealized losses on our marketable securities were not attributable to credit and, therefore, we have not recorded an allowance for credit losses for these securities as of September 30, 2025 and December 31, 2024. See “Cash and Cash Equivalents” and “Short-Term Investments” captions of Note 2. Summary of Significant Accounting Policies of our 2024 Form 10-K for more information on our accounting policies for cash, cash equivalents and short-term investments. NOTE 3. FAIR VALUE MEASUREMENTS Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The three-level hierarchy for the inputs to valuation techniques is briefly summarized as follows: Level 1 – Valuations are based on quoted prices in active markets for identical assets or liabilities and readily accessible by us at the reporting date. Level 2 – Valuations based on inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Valuations based on unobservable inputs for which there is little or no market data, which require us to develop our own assumptions. 8 Table of Contents The following table sets forth the fair value of our financial assets that are measured or disclosed on a recurring basis by level within the fair value hierarchy: September 30, 2025 December 31, 2024 (in thousands) Total Fair Value Level 1 Level 2 Level 3 Total Fair Value Level 1 Level 2 Level 3 Assets Money market funds $ 33,560 $ 33,560 $ — $ — $ 48,650 $ 48,650 $ — $ — U.S. treasury securities 98,872 — 98,872 — 79,773 — 79,773 — U.S. government-sponsored agency bonds 27,132 — 27,132 — 45,962 — 45,962 — Commercial paper 48,749 — 48,749 — 37,065 — 37,065 — Corporate bonds 22,485 — 22,485 — 17,413 — 17,413 — Asset-backed securities 2,752 — 2,752 — 2,985 — 2,985 — Yankee bonds — — — — 1,970 — 1,970 — Total $ 233,550 $ 33,560 $ 199,990 $ — $ 233,818 $ 48,650 $ 185,168 $ — Fair Value of Debt The principal outstanding under our 2022 Loan Agreement is subject to a variable interest rate and therefore, we believe the carrying amount of the term loan approximates fair value as of September 30, 2025 and December 31, 2024. See Note 8. Borrowing for a description of the Level 2 inputs used to estimate the fair value of the liability. The carrying value of the deferred royalty obligation related to the sale of future royalties approximates its fair value as of September 30, 2025 and December 31, 2024 and is based on our current estimates of future royalties and commercialization milestones expected to be paid to us by Kyowa Kirin over the life of the agreement. See Note 7. Deferred Royalty Obligation Related to the Sale of Future Royalties for a description of the Level 3 inputs used to estimate the fair value of the liability. NOTE 4. INVENTORY Inventory consisted of the following: (in thousands) September 30, 2025 December 31, 2024 Raw materials $ 27,622 $ 30,792 Work in process 92,957 58,685 Finished goods 8,779 1,707 Total $ 129,358 $ 91,184 Reported as Inventory $ 25,172 $ 21,173 Inventory, non-current 104,186 70,011 Total $ 129,358 $ 91,184 Prepaid commercial manufacturing with third-party CMOs not included in inventory was $ 8.1 million and $ 16.4 million as of September 30, 2025 and December 31, 2024, respectively. There were no prepayments expected to be converted into inventory after 12 months as of September 30, 2025 and December 31, 2024. 9 Table of Contents NOTE 5. REVENUE Disaggregation of total revenues by nature is as follows: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2025 2024 2025 2024 Product sales, net $ 105,515 $ 92,090 $ 263,406 $ 208,193 Product supply revenue — 5,322 6,439 7,461 Licensing revenue 25 20 5,065 56 Non-cash royalty revenue related to the sale of future royalties 4,789 809 7,195 1,776 Total revenues $ 110,329 $ 98,241 $ 282,105 $ 217,486 Product Sales, Net Total product sales, net was as follows: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2025 2024 2025 2024 Product sales, net IBSRELA $ 78,158 $ 40,638 $ 187,606 $ 104,444 XPHOZAH 27,357 51,452 75,800 103,749 Total product sales, net $ 105,515 $ 92,090 $ 263,406 $ 208,193 Product sales, net as a percentage of total revenues 95.6 % 93.7 % 93.4 % 95.7 % Concentrations Gross product sales from Customers accounting for more than 10% of total revenues were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 2025 2024 Customers (1) BioRidge Pharma, LLC 66.3 % 78.1 % 63.8 % 76.0 % Cardinal Health 25.5 % 12.4 % 23.9 % 14.6 % McKesson Corporation 20.7 % 13.0 % 19.7 % 13.9 % Cencora (formerly AmerisourceBergen Drug Corporation) 17.3 % 13.8 % 18.6 % 15.9 % (1) The total of the above percentages exceeds 100% as the numerators used in the calculations represent gross product sales for each Customer, as opposed to product sales, net as presented in our condensed statements of operations and comprehensive loss. 10 Table of Contents GTN Adjustments The activities and ending reserve balances for each significant category of GTN adjustments on product sales, net, which constitute variable consideration, were as follows: (in thousands) Discounts and Chargebacks Rebates, Wholesaler and GPO Fees Copay Assistance and Returns Total Balance as of December 31, 2024 $ 1,643 $ 14,475 $ 11,170 $ 27,288 Provisions (1) 15,826 74,895 25,929 116,650 Credits/payments ( 15,615 ) ( 59,740 ) ( 25,390 ) ( 100,745 ) Balance as of September 30, 2025 $ 1,854 $ 29,630 $ 11,709 $ 43,193 (1) Provisions included approximately $ 3.8 million of favorable adjustment in the 2025 first quarter, resulting from changes in prior periods’ estimated product returns for XPHOZAH. NOTE 6. COLLABORATION AND LICENSING AGREEMENTS We out-license to external partners for the development and commercialization of tenapanor outside of the U.S. We recognize revenue from our agreements with Kyowa Kirin, Fosun Pharma and Knight as licensing revenue, product supply revenue or non-cash royalty revenue related to the sale of future royalties. See Note 7. Collaboration and Licensing Agreements and “Licensing Revenue Recognition” caption of Note 2. Summary of Significant Accounting Policies of our 2024 Form 10-K for more information on the nature, purpose, significant rights and obligations of the parties, as well as our accounting policies for such revenue streams. The following table summarizes total revenues by collaboration partner: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2025 2024 2025 2024 Licensing revenue Fosun Pharma $ — $ — $ 5,000 $ — Knight 25 20 65 56 Total licensing revenue $ 25 $ 20 $ 5,065 $ 56 Product supply revenue Kyowa Kirin $ — $ 5,322 $ 6,185 $ 7,461 Knight — — 254 — Total supply revenue $ — $ 5,322 $ 6,439 $ 7,461 Non-cash royalty revenue related to the sale of future royalties Kyowa Kirin $ 4,789 $ 809 $ 7,195 $ 1,776 The following table presents changes in our current and non-current deferred revenue balances, which are primarily attributable to Kyowa Kirin: 2025 2024 (in thousands) Current Non-Current Current Non-Current Deferred revenue balance as of January 1, $ 10,686 $ 7,232 $ 7,182 $ 8,644 Prepaid product supply 528 6,467 2,654 8,212 Product supply delivered ( 4,633 ) — ( 6,650 ) — Reclassify amounts to be recognized in the next twelve months — — 4,086 ( 4,086 ) Deferred revenue balance as of September 30, $ 6,581 $ 13,699 $ 7,272 $ 12,770 Significant developments and updates related to our collaboration and licensing agreements in the nine months ended September 30, 2025 and 2024 are discussed below. 11 Table of Contents Kyowa Kirin In February 2024, Kyowa Kirin announced the launch of tenapanor, marketed as PHOZEVEL ® , for patients with CKD with hyperphosphatemia in Japan. Following the launch, we began to recognize earned royalties and commercialization milestones from sales of tenapanor in Japan, which are remitted to HCR in accordance with the HCR Agreement. The first commercialization milestone was achieved in the 2025 third quarter, triggering a ¥ 500.0 million payment to us under the terms of the Kyowa Kirin Agreement, or approximately $ 3.4 million at the currency exchange rate as of September 30, 2025. This milestone was recorded as non-cash royalty revenue related to the sale of future royalties and will be remitted to HCR upon receipt. Fosun Pharma In February 2025, we announced the approval of an NDA for tenapanor for the control of hyperphosphatemia in adult patients with CKD undergoing hemodialysis by China’s Center for Drug Evaluation of the NMPA. This approval triggered a $ 5.0 million milestone to us under the terms of the Fosun Agreement, which was recorded as licensing revenue on our condensed statement of operations and comprehensive loss when earned during the 2025 first quarter and was received in April 2025. AstraZeneca In connection with the AstraZeneca Termination Agreement, we recognized royalty expense as other cost of revenue in our condensed statements of operations and comprehensive loss of zero and $ 12.7 million in the three and nine months ended September 30, 2025, and $ 10.0 million and $ 22.7 million in the three and nine months ended September 30, 2024, respectively. As of the 2025 second quarter, we had fully recognized the $ 75.0 million royalty obligation, which had been fully remitted as of September 30, 2025. NOTE 7. DEFERRED ROYALTY OBLIGATION RELATED TO THE SALE OF FUTURE ROYALTIES We and HCR have an agreement in which HCR agreed to pay up to $ 20.0 million in exchange for royalty and commercialization milestone payments that we may receive under our Kyowa Kirin Agreement. See Note 8. Deferred Royalty Obligation Related to the Sale of Future Royalties of our 2024 Form 10-K for further discussion on the nature, purpose, significant rights and obligations of the parties, as well as our accounting policies regarding the HCR Agreement. A summary of financial information related to the HCR Agreement is as follows: Three Months Ended September 30, Nine Months Ended September 30, ($ in thousands) 2025 2024 2025 2024 Non-cash interest expense related to the sale of future royalties $ ( 2,188 ) $ ( 1,924 ) $ ( 6,478 ) $ ( 5,202 ) Effective interest rate 31.5 % 33.3 % (in thousands) 2025 2024 Deferred royalty obligation balance as of January 1, $ 25,527 $ 20,179 Non-cash interest expense related to sale of future royalties 6,478 5,202 Royalty distributed to HCR ( 3,379 ) ( 1,009 ) Deferred royalty obligation balance as of September 30, $ 28,626 $ 24,372 12 Table of Contents NOTE 8. BORROWING The following table presents our long-term borrowing under the 2022 Loan Agreement: (in thousands) September 30, 2025 December 31, 2024 Interest rate Principal Term A Loan $ 27,500 $ 27,500 7.95 % + 0.022 % + SOFR (subject to a floor of 1.0 %) Term B Loan 22,500 22,500 7.95 % + 0.022 % + SOFR (subject to a floor of 1.0 %) Term C Loan 50,000 50,000 4.25 % + 0.022 % + SOFR (subject to a floor of 4.7 %) Term D Loan 50,000 50,000 4.00 % + 0.022 % + SOFR (subject to a floor of 4.7 %) Term E Loan 50,000 — 4.00 % + 0.022 % + SOFR (subject to a floor of 4.7 %) Total principal 200,000 150,000 Adjustments to principal value Unamortized discount and debt issuance costs ( 1,225 ) ( 1,136 ) Accreted value of final fee 3,363 1,989 Total long-term debt 202,138 150,853 Less: Current portion of long-term debt — — Long-term debt, net of current portion $ 202,138 $ 150,853 On June 30, 2025, we entered into an amendment to our 2022 Loan Agreement (the Fifth Amendment), by and among the Company, as borrower, SLR, as collateral agent and the lenders party thereto. The Fifth Amendment, among other things, (1) provided for the immediate draw of the principal amount of $ 50.0 million (the Term E Loan) on the closing date of the Fifth Amendment and (2) provides us with the option to draw an additional $ 100.0 million of committed senior secured term loans, consisting of two separate term loans, each in a principal amount of $ 50.0 million: (a) the first of which is available at the Company’s election through June 30, 2026 (the Term F Loan) and (b) the second of which is available at the Company’s election through December 20, 2026 (the Term G Loan and, together with the Term F Loan, the Incremental Term Loans). We concluded that the Fifth Amendment was a modification to the 2022 Loan Agreement and is accounted for accordingly. The interest rate for each of the Incremental Term Loans, if drawn, will be 4.95 % plus the 1-month CME Term SOFR reference rate as published by the CME Term SOFR Administrator on the CME Term SOFR Administrator’s Website, subject to a SOFR floor of 3.50 %. On the closing date of the Fifth Amendment, we paid (i) a fee of $ 0.3 million in connection with the funding of the Term E Loan, and (ii) a facility fee of $ 1.0 million with respect to the Incremental Term Loans. Under the Fifth Amendment, the maturity date for the Term E Loan (and the other outstanding term loans) remains July 1, 2028. We are permitted to make interest-only payments on the Term E Loan (and the other outstanding term loans) through July 1, 2028. The maturity date for each of the Incremental Term Loans will be July 1, 2030. We will be permitted to make interest-only payments on the Incremental Term Loans from the date each of the Incremental Term Loans is drawn through July 1, 2030. We will be obligated to pay a final fee equal to 3.45 % of the aggregate original principal amount of the Incremental Term Loans, to the extent such loans are funded, upon the earliest of any final termination, acceleration, prepayment or July 1, 2030. The 2022 Loan Agreement contains certain covenants, including a single financial covenant that the sum of our net product revenue, calculated on a trailing six ( 6 ) month basis, plus unrestricted cash and cash equivalents that are subject to a first-priority perfected lien in favor of SLR, shall be greater than or equal to 100 % of the principal amount outstanding under the 2022 Loan Agreement. In addition, the 2022 Loan Agreement contains subjective acceleration clauses to accelerate the maturity of outstanding principal amount in the event that a material adverse change has occurred within the business, operations or financial condition of the Company. As of September 30, 2025, the Company believes that the likelihood of the acceleration of the maturity due to subjective acceleration clauses is remote. The total unaccreted final fee was $ 6.5 million and $ 5.4 million as of September 30, 2025 and December 31, 2024, respectively. As of September 30, 2025, our total future payment obligation related to the outstanding balance of the term loans, excluding interest payments, was $ 209.9 million, which is due on July 1, 2028. 13 Table of Contents NOTE 9. LEASES The following table provides additional details of our facility leases presented in our condensed balance sheets: ($ in thousands) Facilities September 30, 2025 December 31, 2024 Right-of-use assets $ 5,152 $ 2,380 Current portion of lease liabilities 1,435 1,562 Operating lease liability, net of current portion 4,038 1,023 Total lease liabilities $ 5,473 $ 2,585 Weighted-average remaining term (in years) 3.4 1.8 Weighted-average discount rate 5.6 % 6.5 % The lease costs, which are included in operating expenses in our condensed statements of operations and comprehensive loss, were as follows: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2025 2024 2025 2024 Operating lease expense $ 409 $ 1,067 $ 1,779 $ 3,204 Cash paid for operating leases $ 279 $ 1,229 $ 1,666 $ 3,594 The following table summarizes our undiscounted cash payment obligations for our operating lease liabilities as of September 30, 2025: (in thousands) Operating Leases Remainder of 2025 $ 427 2026 1,784 2027 1,836 2028 1,402 2029 575 Thereafter — Total undiscounted operating lease payments 6,024 Imputed interest expenses ( 551 ) Total operating lease liabilities 5,473 Less: Current portion of operating lease liability ( 1,435 ) Operating lease liability, net of current portion $ 4,038 NOTE 10. STOCKHOLDERS’ EQUITY In January 2023, we filed a registration statement on Form S-3, which became effective in January 2023, containing (i) a base prospectus for the offering, issuance and sale by us of up to a maximum aggregate offering price of $ 250.0 million of our common stock, preferred stock, debt securities, warrants and/or units, from time to time in one or more offerings; and (ii) a prospectus supplement for the offering, issuance and sale by us of up to a maximum aggregate offering price of $ 150.0 million of our common stock that may be issued and sold, from time to time, under a sales agreement with Jefferies, deemed to be “at-the-market offerings” (2023 Open Market Sales Agreement). Pursuant to the 2023 Open Market Sales Agreement, Jefferies, as sales agent, may receive a commission of up to 3.0 % of the gross sales price for shares of common stock sold under the 2023 Open Market Sales Agreement. In the nine months ended September 30, 2025, we completed no sales pursuant to the 2023 Open Market Sales Agreement. As of September 30, 2025, we have completed sales pursuant to the 2023 Open Market Sales Agreement, resulting in the issuance of 16.8 million shares of our common stock and receipt of gross proceeds of $ 70.0 million at a weighted average sales price of approximately $ 4.17 . 14 Table of Contents NOTE 11. EQUITY INCENTIVE PLANS Stock-Based Compensation Expense Stock-based compensation expense recognized for stock options, RSUs and our ESPP is recorded as operating expenses in our condensed statements of operations and comprehensive loss, as follows: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2025 2024 2025 2024 Selling, general and administrative $ 10,400 $ 6,199 $ 28,157 $ 20,305 Research and development 2,342 2,934 8,360 7,213 Total $ 12,742 $ 9,133 $ 36,517 $ 27,518 A summary of our total unrecognized stock-based compensation expense, net of estimated forfeitures, as of September 30, 2025 is as follows: Unrecognized Compensation Expense (in thousands) Average Remaining Vesting Period (in years) Stock option grants $ 54,878 2.67 RSU grants $ 74,606 3.02 ESPP $ 276 0.42 Stock Options A summary of our stock option activity and related information for the nine months ended September 30, 2025 is as follows: Number of Shares (in thousands) Weighted-Average Exercise Price per Share Balance as of December 31, 2024 28,085 $ 5.63 Options granted 7,557 $ 5.02 Options exercised ( 1,642 ) $ 2.17 Options forfeited or canceled ( 3,857 ) $ 6.78 Balance as of September 30, 2025 30,143 $ 5.52 Exercisable as of September 30, 2025 17,039 $ 5.42 Restricted Stock Units A summary of our RSUs activity and related information for the nine months ended September 30, 2025 is as follows: Number of RSUs (in thousands) Weighted-Average Grant Date Fair Value per Share Non-vested restricted stock units as of December 31, 2024 8,013 $ 6.59 Granted 10,351 $ 5.13 Vested ( 2,929 ) $ 5.84 Forfeited ( 1,611 ) $ 6.00 Non-vested restricted stock units as of September 30, 2025 13,824 $ 5.72 15 Table of Contents Employee Stock Purchase Plan During the nine months ended September 30, 2025, we issued approximately 0.4 million shares of our common stock under the ESPP. The shares were purchased by employees at an average purchase price of $ 4.46 per share, resulting in proceeds to us of approximately $ 1.7 million. Issuance of Common Stock for Services During the nine months ended September 30, 2025, we issued 0.1 million shares of our common stock to members of the board of directors who elected to receive stock in lieu of their cash fees under our Non-Employee Director Compensation Program. NOTE 12. SEGMENT REPORTING We operate in a single reportable segment. The CODM primarily uses aggregated net loss as reported on the condensed statements of operations and comprehensive loss to measure segment loss, supplemented by certain additional significant expense details reflected in the table below. There have been no changes in the determination of segmentation or the measurements used to determine reported segment loss discussed in our 2024 Form 10-K. See Note 17. Segment Reporting of our 2024 Form 10-K for more discussion on our segment reporting. Detailed information regarding our single operating segment’s significant revenues, expenses and operating loss is as follows: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2025 2024 2025 2024 Revenues Product sales, net $ 105,515 $ 92,090 $ 263,406 $ 208,193 Other revenues (1) 4,814 6,151 18,699 9,293 Total revenues 110,329 98,241 282,105 217,486 Less Cost of product sales 2,662 1,715 8,247 4,133 Other cost of revenue 1,320 14,013 20,441 28,159 Total cost of goods sold 3,982 15,728 28,688 32,292 Research and development (2) 15,057 11,610 38,260 29,091 Selling (2) 55,361 41,402 170,113 118,094 General and administrative (2) 14,897 13,673 42,505 33,202 Stock-based compensation 12,742 9,133 36,517 27,518 Other segment expenses (3) 3,622 4,462 12,098 13,364 Total operating expenses 101,679 80,280 299,493 221,269 Consolidated income (loss) from operations 4,668 2,233 ( 46,076 ) ( 36,075 ) Other reconciliation items (4) ( 5,637 ) ( 3,042 ) ( 15,116 ) ( 7,706 ) Consolidated net loss $ ( 969 ) $ ( 809 ) $ ( 61,192 ) $ ( 43,781 ) (1) Other revenues includes revenues from our collaboration partnerships, including licensing revenue, product supply revenue and non-cash royalty revenue related to the sale of future royalties. (2) Research and development, selling and general and administrative expenses herein do not include certain allocated items, such as stock-based compensation expenses. (3) Other segment expenses primarily consists of allocated facilities, information technology and employee costs of approximately $ 3.2 million and $ 11.1 million for the three and nine months ended September 30, 2025, and $ 3.9 million and $ 12.2 million for the three and nine months ended September 30, 2024, respectively. (4) Other reconciliation items includes interest expense, non-cash interest expense related to the sale of future royalties, provision for income taxes and other income, net. 16 Table of Contents NOTE 13. NET LOSS PER SHARE Basic net loss per share is calculated by dividing net loss by the weighted-average number of common shares outstanding during the period and excludes any dilutive effect of stock-based awards. Diluted net loss per common share is computed giving effect to all potential dilutive common shares, including common stock issuable upon exercise of stock options, unvested restricted stock units and ESPP shares issuable pursuant to the current purchase period. As we had net losses for the nine months ended September 30, 2025 and 2024, all potential common shares were determined to be anti-dilutive during those periods. The following table sets forth the computation of net loss per common share: (in thousands, except per share amounts) Three Months Ended September 30, Nine Months Ended September 30, Numerator 2025 2024 2025 2024 Net loss $ ( 969 ) $ ( 809 ) $ ( 61,192 ) $ ( 43,781 ) Denominator Weighted average common shares outstanding - basic and diluted 241,908 235,911 240,166 234,516 Net loss per share of common stock - basic and diluted $ ( 0.00 ) $ ( 0.00 ) $ ( 0.25 ) $ ( 0.19 ) The total numbers of securities that could potentially dilute net income per share in the future that were not considered in the diluted net loss per share calculations because the effect would have been anti-dilutive were as follows: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2025 2024 2025 2024 Options to purchase common stock 30,064 28,296 29,940 27,584 Restricted stock units 13,536 8,257 12,510 7,753 ESPP shares issuable 157 224 174 231 Total 43,757 36,777 42,624 35,568 NOTE 14. COMMITMENTS AND CONTINGENCIES On December 7, 2021 and March 29, 2022, two verified shareholders derivative lawsuits were filed in the U.S. District Court for the Northern District of California purportedly on behalf of Ardelyx against certain of Ardelyx’s executive officers and members of our board of directors, captioned Go v. Raab, et al., Case No. 4:21-cv-09455-HSG, and Morris v. Raab, et al., Case No. 4:22-cv-01988-JSC (together, the Go and Morris actions). The complaints allege that the defendants’ violations of Section 14(a) of the Securities Exchange Act of 1934, as amended, breaches of fiduciary duties, unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets for personally making and/or causing Ardelyx to make materially false and misleading statements regarding the Company’s business, operations and prospects. The complaint seeks contribution under Sections 10(b) and 21D of the Securities Exchange Act of 1934 from two executive officers. On January 19, and April 27, 2022, the court granted the parties’ stipulation to stay the Go and Morris actions, respectively, until resolution of the motion(s) to dismiss in the lawsuits captioned Strezsak v. Ardelyx, Inc., et al., Case No. 4:21-cv-05868-HSG, and Siegel v. Ardelyx, Inc., et al., Case No. 5:21-cv-06228-HSG (together, the Securities Class Actions). On October 25, 2022, the parties filed a stipulation to consolidate and stay the Go and Morris actions, and on October 27, 2022, the court consolidated the Go and Morris action and stayed the consolidated action pending resolution of the anticipated motion(s) to dismiss in the Securities Class Action. The Securities Class Actions were voluntarily dismissed on March 5, 2025. The court dismissed the Go and Morris actions on April 30, 2025. 17 Table of Contents On July 17, 2024, in partnership with the AAKP and the NMQF, we filed a lawsuit in the U.S. District Court for the District of Columbia against CMS, claiming that CMS has violated its statutory and regulatory authority under MIPPA, which established the ESRD PPS bundled payment system for dialysis services in 2008. Specifically, the lawsuit claims that moving XPHOZAH, along with all oral-only drugs, into the ESRD PPS is inconsistent with MIPPA’s statutory provision, and contradicts CMS’s own regulations. XPHOZAH and other oral-only drugs, are not administered by dialysis providers and cannot be taken during the delivery of maintenance dialysis. On November 8, 2024, the U.S. District Court for the District of Columbia granted defendants’ Motion to Dismiss and denied plaintiffs Motion for Preliminary Injunction, or in the Alternative, for Expedited Summary Judgment. Following the District Court’s denial of plaintiffs’ Motion to Alter or Amend the Judgment, or in the Alternative, for an Injunction Pending Appeal, plaintiffs filed an Emergency Motion for an Administrative Stay and Injunction Pending Appeal, which was denied by the United States Court of Appeals for the District of Columbia Circuit. Appellants filed an initial brief in the appeal on February 4, 2025; Appellees filed an initial brief on March 6, 2025; and Appellants filed a reply brief March 27, 2025. Both Appellees and Appellants filed a final brief on April 10, 2025. Oral argument in the case was heard on September 25, 2025. On August 16, 2024, a complaint was filed against us in the U.S. District Court of Massachusetts, captioned Yarborough v. Ardelyx, Inc., et al., No. 24-cv-12119 (D. Mass.). The complaint names the Company, Mike Raab, and Justin Renz as defendants and alleges violations of Sections 10(b) and 20(a) the Exchange Act and Rule 10b-5 promulgated thereunder, related to the our announcement on July 2, 2024 that it had chosen not to file an application for Transitional Drug Add-on Payment Adjustment for XPHOZAH (the “Yarborough Action”). The plaintiffs seek damages and interest, and an award of costs, including attorneys’ fees. The Court appointed Tate Wood as lead plaintiff on October 30, 2024. The lead plaintiff filed an amended complaint on January 13, 2025, in which he added Susan Rodriguez, Laura Williams and Elizabeth Grammer as additional defendants and removed Justin Renz as a defendant. The lead plaintiff purports to bring claims on behalf of all those who acquired Ardelyx common stock between February 22, 2024 and July 1, 2024. Defendants filed a motion to dismiss the amended complaint on March 14, 2025. Plaintiffs filed a response on May 13, 2025. Defendants filed a reply in support of their motion to dismiss on June 23, 2025. There is no hearing currently scheduled on the motion to dismiss, and the Court has not yet issued a decision on the motion. We believe the plaintiffs’ claims are without merit. On September 6 and 13, 2024, certain Ardelyx shareholders filed two verified derivative complaints purportedly on behalf of the Company in the United States District Court for the District of Massachusetts alleging violations of Sections 10(b) and/or 14(a) of the Exchange Act, breaches of fiduciary duty, unjust enrichment, waste, and aiding and abetting breaches of fiduciary duty against certain members of our board of directors and management based on substantially the same factual allegations in the Yarborough Action. The complaints seek unspecified damages and corporate governance reforms, as well as costs and attorneys’ fees. On September 25, 2024, the Court consolidated the two derivative actions into the case In re Ardelyx, Inc. Stockholder Derivative Litigation, Case No. 1:24-cv-12302-LTS (D. Mass.). On November 7, 2024, the Court stayed the consolidated derivative action pending resolution of any and all motion(s) to dismiss in the Yarborough Action. We believe the plaintiffs’ claims are without merit. From time to time, we may be involved in legal proceedings arising in the ordinary course of business. As of September 30, 2025, there is no litigation pending that would reasonably be expected to have a material adverse effect on our results of operations and financial condition.