What changed in this filing

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Item 1. Financial Statements

2024-05-02 compared with 2023-10-31 · 212 added, 274 removed, 421 unchanged (54% of the section changed)

3 unchanged sentences

(in thousands, except share and per share amounts)

September 30,

2024 December 31,

8 unchanged sentences

Inventory, non-current 69,045 37,039

Prepaid commercial manufacturing, non-current 4,235 4,235

Right-of-use assets 4,641 5,589

6 unchanged sentences

Accrued compensation and benefits 6,727 12,597

Current portion of long-term debt — 26,711

Current portion of operating lease liability 4,314 4,435

6 unchanged sentences

Deferred royalty obligation related to the sale of future royalties 21,881 20,179

Other liabilities, non-current 170 —

Total liabilities 191,491 130,763

3 unchanged sentences

5,000,000 shares authorized;

no shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively.

no shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively.

Common stock, $ 0.0001 par value;

500,000,000 shares and 300,000,000 shares authorized;

232,133,132 and 198,575,016 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively.

500,000,000 shares authorized;

233,959,744 and 232,453,190 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively.

Additional paid-in capital 1,023,610 1,012,773

Accumulated deficit ( 872,722 ) ( 846,204 )

Accumulated other comprehensive loss ( 201 ) ( 54 )

Accumulated other comprehensive (loss) income ( 20 ) 224

Total stockholders’ equity 150,891 166,816

2 unchanged sentences

ARDELYX, INC.

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands, except share and per share amounts)

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Product sales, net $ 43,512 $ 11,355

1 unchanged sentence

Licensing revenue 17 12

Non-cash royalty revenue related to the sale of future royalties 368 —

Total revenues 46,023 11,369

Cost of goods sold:

Cost of sales 644 230 1,508 287

Cost of product sales 1,013 372

Other cost of revenue 6,115 1,165

4 unchanged sentences

Total operating expenses 63,573 35,896

Income (loss) from operations 7,398 ( 21,880 ) ( 35,290 ) ( 75,902 )

Loss from operations ( 24,678 ) ( 26,064 )

Interest expense ( 2,356 ) ( 1,028 )

1 unchanged sentence

Other income, net 2,339 1,302

Income (loss) before provision for income taxes 6,829 ( 22,893 ) ( 37,051 ) ( 77,894 )

Loss before provision for income taxes ( 26,397 ) ( 26,759 )

Provision for income taxes 121 14

Net income (loss) $ 6,629 $ ( 22,893 ) $ ( 37,265 ) $ ( 77,902 )

Net income (loss) per share of common stock - basic and diluted $ 0.03 $ ( 0.14 ) $ ( 0.17 ) $ ( 0.53 )

Shares used in computing net income (loss) per share - basic 222,782,229 165,104,789 214,976,555 147,319,818

Shares used in computing net income (loss) per share - diluted 227,894,335 165,104,789 214,976,555 147,319,818

Comprehensive income (loss):

Net income (loss) $ 6,629 $ ( 22,893 ) $ ( 37,265 ) $ ( 77,902 )

Unrealized gains (losses) on available-for-sale securities 9 ( 5 ) ( 147 ) ( 108 )

Comprehensive income (loss) $ 6,638 $ ( 22,898 ) $ ( 37,412 ) $ ( 78,010 )

Net loss $ ( 26,518 ) $ ( 26,773 )

Net loss per share of common stock - basic and diluted $ ( 0.11 ) $ ( 0.13 )

Shares used in computing net loss per share - basic and diluted 233,065,960 207,023,127

Comprehensive loss:

Net loss $ ( 26,518 ) $ ( 26,773 )

Unrealized (losses) gains on available-for-sale securities ( 244 ) 34

Comprehensive loss $ ( 26,762 ) $ ( 26,739 )

The accompanying notes are an integral part of these condensed financial statements.

1 unchanged sentence

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

For the Three and Nine Months ended September 30, 2023 and 2022

For the Three Months ended March 31, 2024 and 2023

(in thousands, except shares)

Three Months Ended September 30, 2023

Common Stock Additional

Capital Accumulated

Deficit Accumulated

Comprehensive

Stockholders'

Shares Amount

Balance as of June 30, 2023 217,862,921 $ 22 $ 947,380 $ ( 824,031 ) $ ( 210 ) $ 123,161

Issuance of common stock under employee stock purchase plan 269,739 — 670 — — 670

Issuance of common stock upon exercise of options 28,227 — 40 — — 40

Issuance of common stock upon vesting of restricted stock units 211,277 — — — — —

Issuance of common stock in at the market offering 13,760,968 1 57,162 — — 57,163

Stock-based compensation — — 3,489 — — 3,489

Unrealized gains on available-for-sale securities — — — — 9 9

Net income — — — 6,629 — 6,629

Balance as of September 30, 2023 232,133,132 $ 23 $ 1,008,741 $ ( 817,402 ) $ ( 201 ) $ 191,161

Nine Months Ended September 30, 2023

Three Months Ended March 31, 2024

Common Stock Additional

6 unchanged sentences

Issuance of common stock under employee stock purchase plan 253,312 — 1,038 — — 1,038

Issuance of common stock for services 86,095 — 337 — — 337

Issuance of common stock upon exercise of options 701,578 — 2,183 — — 2,183

Issuance of common stock upon vesting of restricted stock units 551,664 — — — — —

Issuance of common stock in at the market offering 32,274,741 3 119,245 — — 119,248

Stock-based compensation — — 7,616 — — 7,616

1 unchanged sentence

Net loss — — — ( 26,518 ) — ( 26,518 )

Balance as of September 30, 2023 232,133,132 $ 23 $ 1,008,741 $ ( 817,402 ) $ ( 201 ) $ 191,161

Three Months Ended September 30, 2022

Common Stock Additional

Capital Accumulated

Deficit Accumulated

Comprehensive

Stockholders'

Shares Amount

Balance as of June 30, 2022 153,797,834 $ 15 $ 821,075 $ ( 767,939 ) $ ( 109 ) $ 53,042

Issuance of common stock under employee stock purchase plan 181,256 — 112 — — 112

Issuance of common stock for services 711,675 — 390 — — 390

Issuance of common stock upon vesting of restricted stock units 95,555 — — — — —

Issuance of common stock in at the market offering 32,613,325 4 34,363 — — 34,367

Stock-based compensation — — 1,848 — — 1,848

Unrealized losses on available-for-sale securities — — — — ( 5 ) ( 5 )

Net loss — — — ( 22,893 ) — ( 22,893 )

Balance as of September 30, 2022 187,399,645 $ 19 $ 857,788 $ ( 790,832 ) $ ( 114 ) $ 66,861

Nine Months Ended September 30, 2022

Balance as of March 31, 2024 233,959,744 $ 23 $ 1,023,610 $ ( 872,722 ) $ ( 20 ) $ 150,891

Three Months Ended March 31, 2023

Common Stock Additional

6 unchanged sentences

Issuance of common stock under employee stock purchase plan 165,969 — 138 — — 138

Issuance of common stock for services 711,675 — 390 — — 390

Issuance of common stock upon exercise of options 36,001 — 62 — — 62

Issuance of common stock upon vesting of restricted stock units 207,773 — — — — —

1 unchanged sentence

Stock-based compensation — — 2,912 — — 2,912

Unrealized losses on available-for-sale securities — — — — ( 108 ) ( 108 )

Unrealized gains on available-for-sale securities — — — — 34 34

Net loss — — — ( 26,773 ) — ( 26,773 )

Balance as of September 30, 2022 187,399,645 $ 19 $ 857,788 $ ( 790,832 ) $ ( 114 ) $ 66,861

Balance as of March 31, 2023 214,462,050 $ 21 $ 932,330 $ ( 806,910 ) $ ( 20 ) $ 125,421

The accompanying notes are an integral part of these condensed financial statements.

2 unchanged sentences

(in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

Operating activities

4 unchanged sentences

Stock-based compensation 7,616 2,912

Gain on sale of equipment — ( 1,260 )

Non-cash interest expense 1,753 1,044

14 unchanged sentences

Purchases of investments ( 34,024 ) ( 20,763 )

Proceeds from sale of property and equipment — 1,798

Purchases of property and equipment ( 150 ) ( 14 )

Net cash (used in) provided by investing activities ( 101,681 ) 16,974

Net cash used in investing activities ( 2,572 ) ( 9,777 )

Financing activities

Proceeds from 2022 Loan, net of issuance costs 49,750 —

Payments for 2018 Loan, net of costs — ( 33,038 )

Proceeds from the sale of future royalties, net of issuance costs — 9,581

Proceeds from issuance of common stock in at the market offering, net of issuance costs — 50,719

1 unchanged sentence

Net cash provided by financing activities 52,971 50,919

Net decrease in cash and cash equivalents ( 62,373 ) ( 10,800 )

Net increase (decrease) in cash and cash equivalents 14,677 ( 3,653 )

Cash and cash equivalents at beginning of period 21,470 96,140

3 unchanged sentences

Cash paid for income taxes $ 1 $ —

Supplementary disclosure of non-cash activities:

Right-of-use assets obtained in exchange for lease obligations $ 339 $ —

Issuance of common stock for services $ 337 $ 390

Issuance of derivative in connection with issuance of loan payable $ — $ 375

The accompanying notes are an integral part of these condensed financial statements.

9 unchanged sentences

Tenapanor, branded as XPHOZAH ® , was approved by the U.S.

Food and Drug Administration (FDA) on October 17, 2023, to reduce serum phosphorus in adults with chronic kidney disease (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 also have a development stage asset, RDX013 for adult patients with CKD and/or heart failure with hyperkalemia, or elevated serum potassium, and a discovery phase asset, RDX020 for adult patients with metabolic acidosis, a serious electrolyte disorder, in patients with CKD.

Food and Drug Administration (U.S.

FDA) on October 17, 2023, to reduce serum phosphorus in adults with chronic kidney disease (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.

6 unchanged sentences

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 Annual Report on Form 10-K for the year ended December 31, 2023.

The results for the three and nine months ended September 30, 2023 are not necessarily indicative of results to be expected for the entire year ending December 31, 2023, or for any other interim period or future year.

The results for the three months ended March 31, 2024 are not necessarily indicative of results to be expected for the entire year ending December 31, 2024, or for any other interim period or future year.

Use of Estimates

1 unchanged sentence

GAAP requires management to make estimates and judgments that affect the amounts reported in the financial statements and accompanying notes thereto.

On an ongoing basis, management evaluates its estimates, including those related to recognition of revenue, clinical trial accruals, contract manufacturing accruals, utilization of inventory, fair value of assets and liabilities, income taxes and stock-based compensation.

On an ongoing basis, management evaluates its estimates, including those related to recognition of revenue, clinical trial accruals, contract manufacturing accruals, expected demand for inventory, fair value of assets and liabilities, income taxes and stock-based compensation.

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.

As of September 30, 2023, we had cash, cash equivalents and short-term investments of approximately $ 165.1 million.

We have incurred operating losses since inception in 2007 and our accumulated deficit as of September 30, 2023 is $ 817.4 million.

Since December 31, 2021 and prior to September 30, 2023, our liquidity position raised substantial doubt about our ability to continue as a going concern.

We have addressed our operating cash flow requirements through cash generated from product sales of IBSRELA, proceeds from the sale of shares of our common stock under our at-the-market offering, and from the receipt of milestones payments from our collaboration partners and payments from our Japanese collaboration partner under the second amendment to our License Agreement, which were received in October 2023.

We believe our available cash, cash equivalents and short-term investments as of September 30, 2023 will be sufficient to fund our operations for at least a period of one year from the issuance of these condensed financial statements.

As of March 31, 2024, we had cash, cash equivalents and short-term investments of approximately $ 202.6 million.

We have incurred operating losses since inception in 2007 and our accumulated deficit as of March 31, 2024 is $ 872.7 million.

We have addressed our operating cash flow requirements through cash generated from product sales of IBSRELA and XPHOZAH, proceeds from the sale of shares of our common stock under our at-the-market offering, from the receipt of milestone payments from our collaboration partners and payments from our Japanese collaboration partner under the second amendment to our License Agreement, and through funds from our loan agreements with SLR Investment Corp.

(SLR), as amended.

We believe our available cash, cash equivalents and short-term investments as of March 31, 2024 will be sufficient to fund our planned operations for at least a period of one year from the issuance of these condensed financial statements.

Summary of Significant Accounting Policies

3 unchanged sentences

New Accounting Pronouncements - Recently Adopted

In July 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No.

2023-03, Presentation of Financial Statements (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718) Presentation of Financial Statements (ASU 2023-03).

ASU 2023-03 amends the FASB Accounting Standards Codification to include Amendments to SEC Paragraphs pursuant to SEC Staff Accounting Bulletin No.

120, SEC Staff Announcement at the March 24, 2022 EITF Meeting, and SEC Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280 - General Revision of Regulation S-X:

Income or Loss Applicable to Common Stock.

As the ASU does not provide any new guidance, there is no transition or effective date associated with its adoption.

Accordingly, we adopted ASU 2023-03 immediately upon its issuance.

The adoption of ASU 2023-03 did not have any impact on our condensed financial statement presentation or related disclosures.

We have adopted no new accounting pronouncements subsequent to filing our most recent Annual Report on Form 10-K.

Recent Accounting Pronouncements Not Yet Adopted

There were various accounting standards and interpretations issued recently, none of which are expected to have a material impact on our financial position, operations or cash flows.

In October 2023, the Financial Accounting Standards Board (FASB) issued ASU No.

2023-06, Disclosure Improvements - Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative.

The amendments in this Update modify the disclosure or presentation requirements of a variety of Topics in the Codification.

The amendments are in response to the U.S.

Securities and Exchange Commission's (SEC) Release No.

33-10532, Disclosure Update and Simplification, in which the SEC referred certain of its disclosure requirements that overlap with, but require incremental information to, generally accepted accounting principles to the FASB for potential incorporation into the Codification.

For entities subject to the SEC’s existing disclosure requirements and for entities required to file or furnish financial statements with or to the SEC in preparation for the sale of or for purposes of issuing securities that are not subject to contractual restrictions on transfer, the effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited.

For all other entities, the amendments will be effective two years later.

For all entities, if by June 30, 2027, the SEC has not removed the applicable requirement from Regulation S-X or Regulation S-K, the pending content of the related amendment will be removed from the Codification and will not become effective for any entity.

Management is currently assessing the impact of this standard on the Company’s financial statements.

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures.

This Update requires publicly traded entities to provide enhanced disclosures about significant segment expenses regularly reviewed by the chief operating decision maker (CODM), including public traded entities with a single reportable segment.

The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

Early adoption is permitted.

Management is currently assessing the impact of this standard on the Company’s financial statements.

In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures, an amendment which modifies the measurement and recognition of credit losses for most financial assets and certain other instruments.

The amendments in this Update provide more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information.

For public business entities, the amendments in this Update are effective for annual periods beginning after December 15, 2024.

Early adoption is permitted on a prospective basis for annual financial statements that have not yet been issued or made available for issuance.

Management is currently assessing the impact of this standard on the Company’s financial statements.

In March 2024, the FASB issued ASU No.

2024-02, Codification Improvements - Amendments to Remove References to the Concepts Statements, an amendment to the Codification which removes references to various FASB Concepts Statements.

The amendments apply to all reporting entities within the scope of the affected accounting guidance, but in most instances the references removed are extraneous and not required to understand or apply the guidance.

Generally, the amendments in ASU 2024-02 are not intended to result in significant accounting changes for most entities.

The amendments in this update are effective for fiscal years beginning after December 15, 2024 and are not expected to have a significant impact on our financial statements.

CASH, CASH EQUIVALENTS AND INVESTMENTS

Securities classified as cash, cash equivalents and short-term investments as of September 30, 2023 and December 31, 2022 are summarized below (in thousands):

September 30, 2023

Securities classified as cash, cash equivalents and short-term investments as of March 31, 2024 and December 31, 2023 are summarized below (in thousands):

March 31, 2024

Gross Unrealized

5 unchanged sentences

Short-term investments:

Commercial paper $ 82,851 $ 1 $ ( 133 ) $ 82,719

government-sponsored agency bonds $ 101,706 $ 34 $ ( 23 ) $ 101,717

Corporate bonds 6,284 — ( 2 ) 6,282

Commercial paper 53,549 11 ( 39 ) 53,521

Asset-backed securities 8,707 — ( 3 ) 8,704

treasury securities 2,489 — — 2,489

Total short-term investments 166,451 45 ( 65 ) 166,431

8 unchanged sentences

Short-term investments:

Commercial paper $ 25,336 $ 6 $ ( 51 ) $ 25,291

Corporate bonds 1,000 — ( 1 ) 999

government-sponsored agency bonds $ 101,892 $ 235 $ ( 34 ) $ 102,093

Commercial paper 49,630 41 ( 17 ) 49,654

Asset-backed securities 8,628 2 ( 5 ) 8,625

treasury securities 2,455 2 — 2,457

Total short-term investments 162,605 280 ( 56 ) 162,829

2 unchanged sentences

We invest our cash in high quality securities of financial and commercial institutions.

These securities are carried at fair value, which is based on readily available market information, with unrealized gains and losses included in accumulated other comprehensive loss within stockholders’ equity on our condensed balance sheets.

We use the specific identification method to determine the amount of realized gains or losses on sales of marketable securities.

Realized gains or losses have been insignificant and are included in other income, net, in the statement of operations and comprehensive income (loss).

All of the short-term available-for sale securities held as of September 30, 2023 and December 31, 2022 had contractual maturities of less than one year .

Realized gains or losses have not been significant and are included in other income, net, in the statement of operations and comprehensive loss.

All of the short-term available-for sale securities held as of March 31, 2024 and December 31, 2023 had contractual maturities of less than one year .

Our available-for-sale securities are subject to a periodic impairment review.

1 unchanged sentence

When we evaluate an investment for other-than-temporary impairment, we review factors such as the length of time and extent to which fair value has been below cost basis, the financial condition of the issuer and any changes thereto, intent to sell, and whether it is more likely than not we will be required to sell the investment before the recovery of its cost basis.

If an investment is other-than-temporarily impaired or subject to credit losses, we write it down through the statement of operations and comprehensive income (loss) to its fair value and establish that value as a new cost basis for the investment.

Our unrealized losses as of September 30, 2023 and December 31, 2022 were not material.

We determined that none of our available-for-sale securities were other-than-temporarily impaired as of September 30, 2023 and December 31, 2022, and no investment was in a continuous unrealized loss position for more than one year.

If an investment is other-than-temporarily impaired or subject to credit losses, we write it down through the statement of operations and comprehensive loss to its fair value and establish that value as a new cost basis for the investment.

Our unrealized losses as of March 31, 2024 and December 31, 2023 were not material.

We determined that none of our available-for-sale securities were other-than-temporarily impaired as of March 31, 2024 and December 31, 2023, and no investment was in a continuous unrealized loss position for more than one year.

As such, we believe that it is more likely than not that the investments will be held until maturity or a forecasted recovery of fair value.

9 unchanged sentences

The following table sets forth the fair value of our financial assets and liabilities that are measured or disclosed on a recurring basis by level within the fair value hierarchy (in thousands):

September 30, 2023

March 31, 2024

Fair Value Level 1 Level 2 Level 3

Money market funds $ 32,303 $ 32,303 $ — $ —

Commercial paper 82,719 — 82,719 —

government-sponsored agency bonds 101,717 — 101,717 —

Corporate bonds 6,282 — 6,282 —

Commercial paper 53,521 — 53,521 —

Asset-backed securities 8,704 — 8,704 —

treasury securities 2,489 — 2,489 —

Total $ 198,734 $ 32,303 $ 166,431 $ —

Derivative liabilities for exit fees $ 2,055 $ — $ — $ 2,055

Derivative liabilities for exit fee $ 834 $ — $ — $ 834

Total $ 834 $ — $ — $ 834

2 unchanged sentences

Money market funds $ 18,641 $ 18,641 $ — $ —

Commercial paper 25,291 — 25,291 —

Corporate bonds 999 — 999 —

government-sponsored agency bonds 102,093 — 102,093 —

Commercial paper 49,654 — 49,654 —

Asset-backed securities 8,625 — 8,625 —

treasury securities 2,457 — 2,457 —

Total $ 181,470 $ 18,641 $ 162,829 $ —

Derivative liability for exit fee $ 1,656 $ — $ — $ 1,656

Derivative liability for exit fees $ 675 $ — $ — $ 675

Total $ 675 $ — $ — $ 675

4 unchanged sentences

government-sponsored agency bonds, U.S.

treasury notes, corporate bonds, commercial paper, and asset-backed securities as Level 2.

In certain cases, where there is limited activity or less transparency around inputs to valuation, securities or derivative liabilities, such as the 2018 Exit Fee and the 2022 Exit Fee, as defined and discussed in Note 9.

treasury securities, corporate bonds, commercial paper, and asset-backed securities as Level 2.

In certain cases, where there is limited activity or less transparency around inputs to valuation, securities or derivative liabilities, such as the 2022 Exit Fee, as defined and discussed in Note 9.

Derivative Liabilities , are classified as Level 3.

The carrying amounts reflected in the condensed balance sheets for cash equivalents, short-term investments, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their fair values at both September 30, 2023 and December 31, 2022, due to their short-term nature.

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 no t recorded an allowance for credit losses for these securities as of September 30, 2023 and December 31, 2022.

The carrying amounts reflected in the condensed balance sheets for accounts receivable, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their fair values at both March 31, 2024 and December 31, 2023, due to their short-term nature.

Fair Value of Debt

The principal amount outstanding under our term loan facilities is subject to a variable interest rate.

Therefore, we believe the carrying amount of the term loan facility approximates fair value as of September 30, 2023 and December 31, 2022.

Therefore, we believe the carrying amount of the term loan facility approximates fair value as of March 31, 2024 and December 31, 2023.

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, 2023 and December 31, 2022 and is based on our current estimates of future royalties and commercialization milestones expected to be paid to us by Kyowa Kirin Co., Ltd.

The carrying value of the deferred royalty obligation related to the sale of future royalties approximates its fair value as of March 31, 2024 and December 31, 2023 and is based on our current estimates of future royalties and commercialization milestones expected to be paid to us by Kyowa Kirin Co., Ltd.

(Kyowa Kirin) over the life of the agreement.

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.

We began capitalizing inventory during the fourth quarter of 2021, at which time our intent to commercialize IBSRELA was established and we commenced preparation for the commercial launch of IBSRELA.

Inventory as of September 30, 2023 and December 31, 2022 consisted of the following (in thousands):

September 30, 2023 December 31, 2022

Inventory as of March 31, 2024 and December 31, 2023 consisted of the following (in thousands):

March 31, 2024 December 31, 2023

Raw materials $ 20,906 $ 22,920

5 unchanged sentences

Total $ 78,858 $ 49,487

Prepaid commercial manufacturing of $ 17.2 million and $ 13.6 million as of September 30, 2023 and December 31, 2022, respectively, consisted of prepayments to third party contract manufacturing organizations for work we expect to commence within the next 12 months.

PRODUCT REVENUE, NET

We received approval from the FDA in September 2019 to market IBSRELA in the U.S.

We began selling IBSRELA in the U.S.

in March 2022.

We distribute IBSRELA principally through major wholesalers, specialty pharmacies and group purchasing organizations (GPOs) (collectively, our Customers).

Our Customers subsequently sell IBSRELA to pharmacies and patients.

Separately, we enter into arrangements with third parties that provide for government-mandated rebates, chargebacks and discounts.

Revenue from product sales is recognized when our performance obligations are satisfied, which is when Customers obtain control of our product and occurs upon delivery.

During the three and nine months ended September 30, 2023, we recorded net revenue for IBSRELA of $ 22.3 million and $ 51.9 million, respectively.

During the three and nine months ended September 30, 2022, we recorded net revenue for IBSRELA of $ 4.9 million and $ 6.9 million, respectively.

Revenue from the following Customers who contributed greater than 10% of our gross product revenue during the three and nine months ended September 30, 2023 and 2022 as a percentage of total gross product revenue was as follows:

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Cardinal Health 22.2 % 25.2 % 22.3 % 24.2 %

In addition to inventory, we had prepaid commercial manufacturing of $ 9.8 million and $ 23.2 million as of March 31, 2024 and December 31, 2023, respectively, which consisted of prepayments to third party contract manufacturing organizations, including prepayments of $ 4.2 million as of both March 31, 2024 and December 31, 2023 that are expected to be converted into inventory after 12 months.

Total revenues during the three months ended March 31, 2024 and 2023 were as follows (in thousands):

Three Months Ended March 31,

Product sales, net:

IBSRELA $ 28,361 $ 11,355

XPHOZAH 15,151 —

Total product sales, net 43,512 11,355

Product supply revenue 2,126 2

Licensing revenue 17 12

Non-cash royalty revenue related to the sale of future royalties 368 —

Total revenues $ 46,023 $ 11,369

Revenue from Customers who contributed greater than 10% of our total gross product revenue during the three months ended March 31, 2024 and 2023 was as follows (as a percentage of total gross product revenue):

Three Months Ended March 31,

BioRidge Pharma, LLC 39.9 % 17.6 %

AmerisourceBergen Drug Corporation 18.3 % 21.6 %

Cardinal Health 16.2 % 22.2 %

McKesson Corporation 13.5 % 20.8 %

BioRidge Pharma, LLC 19.5 % — % 19.2 % — %

The activities and ending reserve balances for each significant category of discounts and allowances, which constitute variable consideration, were as follows (in thousands):

3 unchanged sentences

Credits/payments ( 2,467 ) ( 7,211 ) ( 3,852 ) ( 13,530 )

Balance as of September 30, 2023 $ 346 $ 3,346 $ 3,032 $ 6,724

Balance as of March 31, 2024 $ 655 $ 6,548 $ 6,910 $ 14,113

Adjustments to prior period provisions recorded in the current period were not material.

COLLABORATION AND LICENSING AGREEMENTS

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Based on our assessment, management determined that the license and the manufacturing supply services were its material performance obligations at the inception of the 2017 Kyowa Kirin Agreement, and as such, each of the performance obligations is distinct.

Under the terms of the 2017 Kyowa Kirin Agreement, Kyowa Kirin paid us an up-front license fee of $ 30.0 million.

We may be entitled to receive up to $ 55.0 million in total development and regulatory milestones, of which $ 35.0 million has been recognized as revenue and $ 20.0 million has been received as of September 30, 2023.

We may also be eligible to receive approximately ¥ 8.5 billion for commercialization milestones, or approximately $ 57.0 million at the currency exchange rate on September 30, 2023, as well as reimbursement of costs plus a reasonable overhead for the supply of product and royalties on net sales throughout the term of the agreement.

We may be entitled to receive up to $ 55.0 million in total development and regulatory milestones, of which $ 35.0 million has been received and recognized as revenue as of March 31, 2024.

We may also be eligible to receive approximately ¥ 8.5 billion for commercialization milestones, or approximately $ 56.2 million at the currency exchange rate on March 31, 2024, as well as reimbursement of costs plus a reasonable overhead for the supply of product and royalties on net sales throughout the term of the agreement.

As discussed in Note 7.

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pursuant to a Royalty and Sales Milestone Interest Acquisition Agreement.

The variable consideration related to the remaining milestone payments was fully constrained at September 30, 2023.

The variable consideration related to the remaining milestone payments was fully constrained at March 31, 2024.

In April 2022, we entered into a second amendment to the 2017 Kyowa Kirin Agreement (2022 Amendment).

Under the terms of the 2022 Amendment, we and Kyowa Kirin have agreed to a reduction in the royalty rate payable to us by Kyowa Kirin upon net sales of tenapanor for hyperphosphatemia in Japan.

Under the terms of the 2022 Amendment, we and Kyowa Kirin agreed to a reduction in the royalty rate payable to us by Kyowa Kirin upon net sales of tenapanor for hyperphosphatemia in Japan.

The royalty rate will be reduced from the high teens to low double digits for a two-year period of time following the first commercial sale in Japan, and then to mid-single digits for the remainder of the royalty term.

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Deferred Royalty Obligation Related to the Sale of Future Royalties , the future commercial milestones and royalties we may receive under the 2017 Kyowa Kirin Agreement will be remitted to HealthCare Royalty Partners IV, L.P.

pursuant to a Royalty and Sales Milestone Interest Acquisition Agreement.

As consideration for the reduction in the royalty rate, Kyowa Kirin agreed to pay us up to an additional $ 40.0 million payable in two tranches, with the first payment due following Kyowa Kirin's filing with the Japanese Ministry of Health, Labour and Welfare (MHLW) of its application for marketing approval for tenapanor and the second payment due following Kyowa Kirin’s receipt of regulatory approval to market tenapanor for hyperphosphatemia in Japan, both of which have occurred as of September 30, 2023.

(HCR) pursuant to a Royalty and Sales Milestone Interest Acquisition Agreement (HCR Agreement).

In October 2022, we announced that Kyowa Kirin submitted a New Drug Application (NDA) to the Japanese MHLW for tenapanor for the improvement of hyperphosphatemia in adult patients with CKD on dialysis, which resulted in payment to us from Kyowa Kirin for an aggregate of $ 35.0 million for milestone payments and payments under the 2022 Amendment.

We received these payments during the fourth quarter of 2022 and recorded them as licensing revenue on our condensed statement of operations and comprehensive income (loss).

In September 2023, we announced that Kyowa Kirin received approval from the Japanese MHLW for the NDA for tenapanor for the improvement of hyperphosphatemia in adult patients with CKD on dialysis, which results in payment to us from Kyowa Kirin for an aggregate of $ 30.0 million for milestone payments and payments under the 2022 Amendment.

We received these payments in October 2023 and recorded them as licensing revenue on our condensed statement of operations and comprehensive income (loss) when earned during the three months ended September 30, 2023 and reported them as accounts receivable on our condensed balance sheet as of September 30, 2023.

During the three and nine months ended September 30, 2022, we recognized no licensing revenue pursuant to the 2017 Kyowa Kirin Agreement.

During the three and nine months ended September 30, 2023, we recognized $ 2.1 million and $ 5.4 million, respectively, of product supply revenue pursuant to the 2017 Kyowa Kirin Agreement.

During the three and nine months ended September 30, 2022, we recognized $ 83 thousand and $ 1.0 million, respectively, of product supply revenue pursuant to the 2017 Kyowa Kirin Agreement.

We received these payments during the fourth quarter of 2022 and recorded them as licensing revenue on our condensed statement of operations and comprehensive loss.

In September 2023, we announced that Kyowa Kirin received approval from the Japanese MHLW for the NDA for tenapanor for the improvement of hyperphosphatemia in adult patients with CKD on dialysis, which resulted in payment to us from Kyowa Kirin for an aggregate of $ 30.0 million for milestone payments and payments under the 2022 Amendment.

We received these payments in October 2023 and recorded them as licensing revenue on our condensed statement of operations and comprehensive loss when earned during the three months ended September 30, 2023.

In February 2024, Kyowa Kirin announced the launch of tenapanor, marketed as PHOZEVEL ® , for patients in Japan.

During the first quarter of 2024, we recognized $ 0.4 million of non-cash royalty revenue related to the sale of future royalties, which will be remitted to HCR in accordance with the HCR Agreement.

During the three months ended March 31, 2024, we recognized $ 2.1 million of product supply revenue pursuant to the 2017 Kyowa Kirin Agreement.

During the three months ended March 31, 2023, we recognized $ 2 thousand of product supply revenue pursuant to the 2017 Kyowa Kirin Agreement.

During the three months ended March 31, 2024 and 2023, we did not recognize a material amount of licensing revenue pursuant to the 2017 Kyowa Kirin Agreement.

Shanghai Fosun Pharmaceutical Industrial Development Co.

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Based on our assessment, we determined that the license and the manufacturing supply services represented the material performance obligations at the inception of the agreement and, as such, each of the performance obligations are distinct.

We may be entitled to receive development and commercialization milestones of up to $ 113.0 million, of which $ 5.0 million has been received and recognized as revenue as of September 30, 2023, as well as reimbursement of cost plus a reasonable overhead for the supply of product and tiered royalties on net sales ranging from the mid-teens to 20 %.

The variable consideration related to the remaining development milestone payments was fully constrained at September 30, 2023.

We may be entitled to receive development and commercialization milestones of up to $ 113.0 million, of which $ 8.0 million has been received and recognized as revenue as of March 31, 2024, as well as reimbursement of cost plus a reasonable overhead for the supply of product and tiered royalties on net sales ranging from the mid-teens to 20 %.

The variable consideration related to the remaining development milestone payments was fully constrained at March 31, 2024.

In July 2023, we announced that an NDA for tenapanor had been accepted for review by China’s Center for Drug Evaluation of the National Medical Products Administration (NMPA) for the control of serum phosphorus in adult patients with CKD on hemodialysis.

This acceptance triggered a $ 2.0 million milestone payment to us under the terms of the Fosun Agreement.

We received this payment during the third quarter of 2023 and recorded it as licensing revenue on our condensed statement of operations and comprehensive income (loss) when earned during the three months ended September 30, 2023.

In October 2023, we announced that the FDA had approved XPHOZAH 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.

This triggered an additional $ 3.0 million milestone payment to us under the terms of the Fosun Agreement, which we expect to receive during the fourth quarter of 2023.

We received this payment during the third quarter of 2023 and recorded it as licensing revenue on our condensed statement of operations and comprehensive loss when earned during the three months ended September 30, 2023.

In October 2023, we announced that the U.S.

FDA had approved XPHOZAH 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.

This triggered an additional $ 3.0 million milestone payment to us under the terms of the Fosun Agreement, which was received during the first quarter of 2024.

Also, in October 2023, we announced that Fosun Pharma received approval from the Hong Kong Department of Health for the marketing application for tenapanor for the treatment of irritable bowel syndrome with constipation (IBS-C).

During the three and nine months ended September 30, 2022, we did not recognize a material amount of revenue pursuant to the Fosun Agreement.

During the three months ended March 31, 2024 and 2023, we did not recognize a material amount of revenue pursuant to the Fosun Agreement.

Knight Therapeutics, Inc.

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Based on our assessment, we determined that the license and the manufacturing supply services were the material performance obligations at the inception of the agreement and, as such, each of the performance obligations are distinct.

Under the terms of the Knight Agreement, we received a $ 2.3 million non-refundable, one-time upfront payment in March 2018 and may be eligible to receive additional development and commercialization milestone payments worth up to CAD 22.2 million, or approximately $ 16.4 million at the currency exchange rate on September 30, 2023, of which $ 0.7 million has been received and recognized as revenue as of September 30, 2023.

Under the terms of the Knight Agreement, we received a $ 2.3 million non-refundable, one-time upfront payment in March 2018 and may be eligible to receive additional development and commercialization milestone payments worth up to CAD 22.2 million, or approximately $ 16.3 million at the currency exchange rate on March 31, 2024, of which $ 0.7 million has been received and recognized as revenue as of March 31, 2024.

We are also eligible to receive royalties ranging from the mid-single digits to the low twenties throughout the term of the agreement, and a transfer price for manufacturing services.

The variable consideration related to the remaining development milestone payments was fully constrained at September 30, 2023.

During the three and nine months ended September 30, 2023 and 2022, we did not recognize a material amount of revenue pursuant to the Knight Agreement.

METiS Therapeutics Inc.

In April 2023, we entered into an exclusive, worldwide license agreement with METiS Therapeutics Inc., (METiS Agreement) for the development and commercialization of a portfolio of TGR5 agonist compounds that were discovered and developed by Ardelyx for all therapeutic areas.

We assessed this arrangement in accordance with ASC 606 and concluded that the contract counterparty, METiS, is a customer.

Based on our assessment, we determined that the license was the material performance obligation at the inception of the agreement.

Under the terms of the METiS Agreement, we received a $ 0.8 million non-refundable, one-time upfront payment in April 2023 and may be eligible to receive additional development and commercialization milestone payments worth up to $ 243.0 million.

We are also eligible to receive royalties ranging within the mid-single digits throughout the term of the agreement.

The variable consideration related to the remaining development and commercialization milestone payments was fully constrained at September 30, 2023.

During the three and nine months ended September 30, 2023, we recognized $ 0.8 million of licensing revenue pursuant to the METiS Agreement.

The variable consideration related to the remaining development milestone payments was fully constrained at March 31, 2024.

During the three months ended March 31, 2024 and 2023, we did not recognize a material amount of revenue pursuant to the Knight Agreement.

AstraZeneca AB (AstraZeneca)

In June 2015, we entered into a termination agreement with AstraZeneca (AstraZeneca Termination Agreement) pursuant to which we have agreed to pay AstraZeneca (i) future royalties at a royalty rate of 10 % of net sales of tenapanor or other NHE3 products by us or our licensees, and (ii) 20 % of non-royalty revenue received from a new collaboration partner should we elect to license, or otherwise provide rights to develop and commercialize tenapanor or other NHE3 products, up to a maximum of $ 75.0 million in aggregate for (i) and (ii).

As of September 30, 2023, to date in aggregate, we have recognized $ 23.9 million of the $ 75.0 million, which has been recorded as other cost of revenue on our condensed statements of operations and comprehensive income (loss), and have paid AstraZeneca $ 18.3 million.

During the three and nine months ended September 30, 2023, we recognized $ 5.7 million and $ 8.7 million, respectively, as other cost of revenue related to the AstraZeneca Termination Agreement.

During the three and nine months ended September 30, 2022 we recognized $ 0.5 million and $ 0.8 million, respectively, as other cost of revenue related to the AstraZeneca Termination Agreement.

As of March 31, 2024, to date in aggregate, we have recognized $ 32.4 million of the $ 75.0 million, which has been recorded as other cost of revenue on our condensed statements of operations and comprehensive loss.

During the three months ended March 31, 2024, we recognized $ 4.7 million as other cost of revenue related to the AstraZeneca Termination Agreement.

During the three months ended March 31, 2023 we recognized $ 1.2 million as other cost of revenue related to the AstraZeneca Termination Agreement.

Deferred Revenue

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Reclassify amounts to be recognized in the next twelve months — — 809 ( 809 )

Balance at September 30, $ 4,072 $ 10,290 $ 4,003 $ 8,560

Balance at March 31, $ 6,586 $ 12,103 $ 5,545 $ 11,498

DEFERRED ROYALTY OBLIGATION RELATED TO THE SALE OF FUTURE ROYALTIES

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Under the terms of the HCR Agreement, HCR has agreed to pay us up to $ 20.0 million in exchange for the royalty payments and commercial milestone payments (collectively the Royalty Interest Payments) that we may receive under our 2017 License Agreement with Kyowa Kirin based upon Kyowa Kirin's net sales of tenapanor in Japan for hyperphosphatemia.

As consideration for the sale of the Royalty Interest Payments, HCR paid to us a $ 10.0 million upfront payment, and we are eligible to receive a $ 5.0 million payment as a result of Kyowa Kirin's receipt of regulatory approval to market tenapanor for hyperphosphatemia in Japan, and another $ 5.0 million payment in the event net sales by Kyowa Kirin in Japan exceed a certain annual target level by the end of 2025.

In September 2023, we announced that Kyowa Kirin received approval from the Japanese MHLW for the New Drug Application for tenapanor for the improvement of hyperphosphatemia in adult patients with chronic kidney disease on dialysis, which entitles us to the first $ 5.0 million payment under the terms of the HCR Agreement.

We received the payment in October 2023.

As consideration for the sale of the Royalty Interest Payments, HCR paid to us a $ 10.0 million upfront payment in June 2022 and a $ 5.0 million payment, which we received in October 2023, as a result of Kyowa Kirin's receipt of regulatory approval to market tenapanor for hyperphosphatemia in Japan.

We are eligible to receive another $ 5.0 million payment in the event net sales by Kyowa Kirin in Japan exceed a certain annual target level by the end of 2025.

The HCR Agreement is effective until terminated by the mutual agreement of the parties and contains customary representations and warranties and customary affirmative and negative covenants, including, among others, requirements as to prosecution, maintenance, defense and enforcement of certain patent rights in Japan, restrictions regarding our ability to forgive, release or reduce any Royalty Interest Payments due to us under the 2017 Kyowa Kirin Agreement, to create or incur any liens with respect to the Royalty Interest Payments, the 2017 Kyowa Kirin Agreement or certain patents, or to sell, license or transfer certain patents in the field and territory described in the 2017 Kyowa Kirin Agreement.

In addition, the HCR Agreement contains customary events of default with respect to which we may incur indemnification obligations to HCR for any losses incurred by HCR and related parties as a result of the event of default, subject to a specified limitation of liability cap.

Under the HCR Agreement, an event of default will occur if, among other things, any of the representations and warranties included in the HCR Agreement proves not to have been true and correct in all material respects, at the time it was made, we breach any of our covenants under the HCR Agreement, subject to specified cure periods with respect to certain breaches, we are in breach or default under the 2017 Kyowa Kirin Agreement in any manner which is likely to cause a material adverse effect on the Royalty Interest Payments, the occurrence of a termination of the 2017 Kyowa Kirin

Agreement under certain circumstances or we or our assets become subject to certain legal proceedings, such as bankruptcy proceedings, or we are unable to pay our debts as they become due.

We received the $ 10.0 million upfront payment from HCR during June 2022 and recorded it as a deferred royalty obligation related to the sale of future royalties (deferred royalty obligation) on our balance sheet.

The $ 10.0 million upfront payment from HCR received in June 2022 and the $ 5.0 million payment received in October 2023 have been recorded as a deferred royalty obligation related to the sale of future royalties (deferred royalty obligation) on our balance sheets.

Due to our ongoing manufacturing obligations under the 2017 Kyowa Kirin Agreement, we account for the proceeds as imputed debt and therefore will recognize royalties earned under the arrangement as non-cash royalty revenue.

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Such factors include, but are not limited to, the amount and timing of potential future royalty payments to be received from Kyowa Kirin under the 2017 Kyowa Kirin agreement, changing standards of care, the introduction of competing products, manufacturing or other delays, intellectual property matters, adverse events that result in governmental health authority imposed restrictions on the use of the drug products, significant changes in foreign exchange rates as the royalties remitted to HCR are made in U.S.

dollars while the underlying sales of the products by Kyowa Kirin are made in Japanese yen, and other events or circumstances that could result in reduced royalty payments from Kyowa Kirin, which are not within our control, and all of which would result in a reduction of non-cash royalty revenues and the non-cash interest expense over the life of the deferred royalty obligation.

dollars while the underlying

sales of the products by Kyowa Kirin are made in Japanese yen, and other events or circumstances that could result in reduced royalty payments from Kyowa Kirin, which are not within our control, and all of which would result in a reduction of non-cash royalty revenues and the non-cash interest expense over the life of the deferred royalty obligation.

We periodically assess the estimated royalty payments from Kyowa Kirin and, to the extent that the amount or timing of such payments is materially different than our original estimates, we prospectively adjust the imputed interest rate and the related amortization of the deferred royalty obligation.

As of September 30, 2023, our effective interest rate used to amortize the liability is 23.9 %.

During the three and nine months ended September 30, 2023, we recognized approximately $ 0.9 million and $ 2.9 million, respectively, of non-cash interest expense related to the deferred royalty obligation.

During each of the three and nine months ended September 30, 2022, we recognized approximately $ 0.8 million of non-cash interest expense related to the deferred royalty obligation.

As of September 30, 2023, we have received no royalty payments from Kyowa Kirin and, therefore, the deferred royalty obligation has not begun to be reduced.

As of March 31, 2024, our effective interest rate used to amortize the liability is 33.7 %.

During the three months ended March 31, 2024, we recognized approximately $ 1.7 million of non-cash interest expense related to the deferred royalty obligation.

During the three months ended March 31, 2023, we recognized approximately $ 1.0 million of non-cash interest expense related to the deferred royalty obligation.

As of March 31, 2024, we have received no royalty payments from Kyowa Kirin and, therefore, the deferred royalty obligation has not begun to be reduced.

Solar Capital and Western Alliance Bank Loan Agreement

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As discussed in Note 9.

Derivative Liability , in connection with entering into the 2018 Loan Agreement, we entered into an agreement pursuant to which we agreed to pay $ 1.5 million in cash upon the occurrence of certain conditions (2018 Exit Fee).

Our obligations for the 2018 Exit Fee remained outstanding following the full repayment of the 2018 Loan in February 2022 until October 2023 when we received approval from the FDA for XPHOZAH 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.

Derivative Liabilities , in connection with entering into the 2018 Loan Agreement, we entered into an agreement pursuant to which we agreed to pay $ 1.5 million in cash upon the occurrence of certain conditions (2018 Exit Fee).

Our obligations for the 2018 Exit Fee remained outstanding following the full repayment of the 2018 Loan in February 2022 until October 2023 when we received approval from the U.S.

FDA for XPHOZAH 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.

This triggered our obligation to pay the 2018 Exit Fee to the 2018 Lenders and we subsequently paid the 2018 Exit Fee in October 2023.

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We concluded that the First Amendment and the Second Amendment were modifications to the 2022 Loan Agreement.

The 2022 Loan Agreement as amended by the First Amendment and the Second Amendment provided for a senior secured loan facility, with $ 27.5 million (Term A Loan) funded on the Closing Date and an additional $ 22.5 million which we may borrow on or prior to December 20, 2023;

provided that (i) we have received approval by the FDA for our NDA for XPHOZAH by November 30, 2023, and (ii) we have achieved certain product revenue milestone targets described in the

2022 Loan Agreement (Term B Loan, and together with the Term A Loan, the 2022 Original Loans).

The 2022 Loan Agreement, as amended by the First Amendment and the Second Amendment, provided for a senior secured loan facility, with $ 27.5 million (Term A Loan) funded on the Closing Date and an additional $ 22.5 million which was funded upon our election in October 2023 (Term B Loan, and together with the Term A Loan, the 2022 Original Loans).

The 2022 Term A Loan funds were used to repay the 2018 Loan with the 2018 Lenders.

On October 17, 2023, we entered into a Third Amendment (the Third Amendment) to the 2022 Loan Agreement by and between us and the 2022 Lenders.

The Third Amendment, among other things, (1) provides us with the option to draw an additional $ 50.0 million of committed capital by March 15, 2024 (the Term C Loan);

The Third Amendment, among other things, (1) provided us with the option to draw an additional $ 50.0 million of committed capital by March 15, 2024 (the Term C Loan) provided we have drawn the Term B Loan;

and (2) provides us with the option to draw up to an additional $ 50.0 million of uncommitted capital by December 31, 2026, subject to approval by the Agent’s investment committee (the Term D Loan and together with the Term A, B, and C Loans, the Four 2022 Loans).

In February 2024, we provided the Agent with notice of our decision to draw the Term C Loan to support the commercial launch of XPHOZAH and received the proceeds of the Term C Loan in March 2024.

We concluded that the Third Amendment was a modification to the 2022 Original Loan Agreement.

Under the Third Amendment, the maturity date for the Four 2022 Loans is March 1, 2027.

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The interest rate for each of the Term C Loan and the Term D Loan is 4.25 % plus a SOFR value equal to 0.022 % 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 4.7 %.

In addition, the period under which we are permitted to make interest-only payments on the Four 2022 Loans was extended to December 31, 2026, effective upon our decision to draw the Term B Loan in the amount of $ 22.5 million.

We provided the Agent with notice of our decision to draw the Term B Loan in October 2023 to support the commercial launch of XPHOZAH.

We were obligated to pay $ 0.2 million, upon the closing of the Term A Loan, and we were obligated to pay $ 0.1 million on the funding date of the Term B Loan.

We are obligated to pay $ 0.3 million on the earliest of (1) the funding date of the Term C Loan, (2) March 15, 2024, and (3) the prepayment, refinancing, substitution or replacement of the Term B Loans on or prior to March 15, 2024.

In addition, pursuant to the Third Amendment, the period under which we are permitted to make interest-only payments on the Four 2022 Loans was extended to December 31, 2026, effective upon our decision to draw the Term B Loan in the amount of $ 22.5 million.

We were obligated to pay $ 0.2 million, upon the closing of the Term A Loan, $ 0.1 million on the funding date of the Term B Loan, and $ 0.3 million on the funding date of the Term C Loan.

In addition, we will be obligated to pay 0.5 % of the aggregate original principal amount of the Term D Loan commitment, if requested by us and approved by the Agent’s investment committee, which shall be due on the earliest of (1) the funding of the Term D Loan, (2) if we request and the 2022 Lenders provide the Term D Loan commitment, the day immediately preceding the amortization date, and (3) if we request and the 2022 Lenders provide the Term D Loan commitment, the prepayment, refinancing, substitution or replacement of the Term C Loan on or prior to the date immediately preceding the amortization date.

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Additionally, as discussed in Note 9.

Derivative Liabilities , in connection with the 2022 Original Loans, we entered into an agreement whereby we agreed to pay an exit fee in the amount of 2 % of the 2022 Loan funded (2022 Exit Fee).

Derivative Liabilities , in connection with the 2022 Original Loans, we entered into an agreement whereby we agreed to pay an exit fee in the amount of 2 % of the 2022 Original Loans funded (2022 Exit Fee).

Notwithstanding the prepayment or termination of the 2022 Loan, the 2022 Exit Fee will expire 10 years from the Closing Date.

The 2022 Loan Agreement, as amended, contains customary representations and warranties and customary affirmative and negative covenants, including, among others, requirements as to financial reporting and insurance and restrictions on our ability to dispose of our business or property, to change our line of business, to liquidate or dissolve, to enter into any change in control transaction, to merge or consolidate with any other entity or to acquire all or substantially all the capital stock or property of another entity, to incur additional indebtedness, to incur liens on our property, to pay any dividends or other distributions on capital stock other than dividends payable solely in capital stock or to redeem capital stock.

We have agreed to not allow our cash and cash equivalents to be less than the eighty percent ( 80 %) of the outstanding Four 2022 Term Loan balance for any period in which our net revenue from the sale of any products, calculated on a trailing six ( 6 ) month basis and tested monthly, is less than sixty percent ( 60 %) of the outstanding Four 2022 Loan balance.

We have agreed to not allow our cash, cash equivalents and available-for-sale investments to be less than the eighty percent ( 80 %) of the outstanding Four 2022 Term Loan balance for any period in which our net revenue from the sale of any products, calculated on a trailing six ( 6 ) month basis and tested monthly, is less than sixty percent ( 60 %) of the outstanding Four 2022 Loan balance.

In addition, the 2022 Loan Agreement, as amended, contains customary events of default that entitle the Agent to cause our indebtedness under the 2022 Loan Agreement to become immediately due and payable, and to exercise remedies against us and the collateral securing the Four 2022 Term Loans, including our cash.

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Upon the occurrence and for the duration of an event of default, an additional default interest rate equal to 4 % per annum will apply to all obligations owed under the 2022 Loan Agreement.

We have classified the 2022 Original Loan balance as a non-current liability as of September 30, 2023 due to principal repayments beginning in January 2027.

As of September 30, 2023, our future payment obligations related to the Original 2022 Loan, excluding interest payments and the 2022 final fee, were as follows (in thousands):

We have classified the 2022 Original Loan balance as a non-current liability as of March 31, 2024 due to principal repayments beginning in January 2027.

We have concluded that the provisions that could cause acceleration of the principal repayments are remote.

As of March 31, 2024, our future payment obligations related to the 2022 Loan, excluding interest payments and the 2022 final fee, were as follows (in thousands):

Total repayment obligations $ 104,950

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2018 Exit Fee

In May 2018, in connection with entering into the 2018 Loan Agreement, we entered into an agreement pursuant to which we agreed to pay $ 1.5 million in cash (2018 Exit Fee) upon any change of control transaction in respect of the Company or if we obtain both (i) FDA approval of XPHOZAH and (ii) FDA approval of IBSRELA, which was obtained on September 12, 2019 (2018 Exit Fee Agreement).

Notwithstanding the February 2022 prepayment of the 2018 Loan, our obligation to pay the 2018 Exit Fee will expire on May 16, 2028.

We concluded that the 2018 Exit Fee is a freestanding derivative which should be accounted for at fair value on a recurring basis.

The estimated fair value of the 2018 Exit Fee is recorded as a derivative liability and included in accrued expense and other current liabilities on the accompanying condensed balance sheets.

As of September 30, 2023 and December 31, 2022, the estimated fair value of the 2018 Exit Fee was $ 1.5 million and $ 1.2 million, respectively.

In October 2023, we received approval from the FDA for XPHOZAH to reduce serum phosphorus in adults with chronic kidney disease (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.

This triggered our obligation to pay the 2018 Exit Fee to the 2018 Lenders and we subsequently paid the 2018 Exit Fee in October 2023.

The fair value of the derivative liability was determined using a discounted cash flow analysis and is classified as a Level 3 measurement within the fair value hierarchy since our valuation utilized significant unobservable inputs.

Specifically, the key assumptions included in the calculation of the estimated fair value of the derivative instrument include:

(i) our estimates of both the probability and timing of a potential $ 1.5 million payment to the 2018 Lenders as a result of the FDA approvals, and (ii) a discount rate which was derived from our estimated cost of debt, adjusted with current LIBOR.

Generally, increases or decreases in the probability of occurrence would result in a directionally similar impact in the fair value measurement of the derivative instrument and it is estimated that a 10 % increase (decrease), not to exceed 100%, in the probability of occurrence would result in a fair value fluctuation of no more than $ 0.1 million.

FDA approval of XPHOZAH and (ii) U.S.

FDA approval of IBSRELA, which was obtained on September 12, 2019 (2018 Exit Fee Agreement).

Notwithstanding the February 2022 prepayment of the 2018 Loan, our obligation to pay the 2018 Exit Fee would have expired on May 16, 2028.

We concluded that the 2018 Exit Fee was a freestanding derivative which should be accounted for at fair value on a recurring basis.

In October 2023, we received approval from the U.S.

FDA for XPHOZAH to reduce serum phosphorus in adults with chronic kidney disease (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.

This triggered our obligation to pay the 2018 Exit Fee to the 2018 Lenders.

Prior to our subsequent payment of the 2018 Exit Fee in October 2023, the estimated fair value of the 2018 Exit Fee was recorded as a derivative liability and included in accrued expense and other current liabilities on the accompanying condensed balance sheets.

2022 Exit Fee

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The estimated fair value of the 2022 Exit Fee is recorded as a derivative liability and included in accrued expenses and other current liabilities on the accompanying condensed balance sheets.

As of September 30, 2023 and December 31, 2022, the estimated fair value of the 2022 Exit Fee was $ 0.6 million and $ 0.4 million, respectively.

As of March 31, 2024 and December 31, 2023, the estimated fair value of the 2022 Exit Fee was $ 0.8 million and $ 0.7 million, respectively.

Specifically, the key assumptions included in the calculation of the estimated fair value of the 2022 Exit Fee derivative liability include:

(i) our estimates of both the probability and timing of achieving the Revenue Milestone and (ii) the probability and timing of funding the Term B Loan, which was dependent upon (a) approval by the FDA for our NDA for the control of serum phosphorus in adult patients with CKD on dialysis by November 30, 2023, and (b) achievement of certain product revenue milestone targets.

FDA for our NDA for the control of serum phosphorus in adult patients with CKD on dialysis by November 30, 2023, and (b) achievement of certain product revenue milestone targets.

As of March 31, 2024, uncertainty around two of the noted valuation estimates had been removed, as the Term B Loan had been funded and the U.S.

FDA had approved our NDA for the control of serum phosphorus in adult patients with CKD on dialysis prior to November 30, 2023.

Generally, increases or decreases in the probability of occurrence would result in a directionally similar impact in the fair value measurement of the derivative liability and it is estimated that a 10 % increase (decrease) in the probability of occurrence would not result in a material fair value fluctuation.

Changes in the fair value of recurring measurements included in Level 3 of the fair value hierarchy are presented as other income, net in our condensed statements of operations and comprehensive income (loss) and were as follows for the nine months ended September 30, 2023 and 2022 (in thousands):

Balance at January 1, $ 1,656 $ 698

2022 Exit Fee addition at fair value — 375

Changes in the fair value of recurring measurements included in Level 3 of the fair value hierarchy are presented as other income, net in our condensed statements of operations and comprehensive loss and were as follows for the three months ended March 31, 2024 and 2023 (in thousands):

Fair value of exit fee derivative liabilities at January 1, $ 675 $ 1,656

Changes in estimated fair value:

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2022 Exit Fee 159 22

Balance at September 30, $ 2,055 $ 1,127

Fair value of exit fee derivative liabilities at March 31, $ 834 $ 1,726

All of our leases are operating leases and each contain customary rent escalation clauses.

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The following table provides additional details of our facility leases presented in our condensed balance sheets (dollars in thousands):

Facilities September 30, 2023 December 31, 2022

Facilities March 31, 2024 December 31, 2023

Right-of-use assets $ 4,641 $ 5,589

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Operating lease liability, net of current portion 778 1,725

Total $ 7,208 $ 9,749

Total lease liabilities $ 5,092 $ 6,160

Weighted-average remaining life (years) 1.3 1.6

Weighted-average discount rate 6.8 % 6.8 %

The lease costs, which are included in operating expenses in our condensed statements of operations and comprehensive income (loss), were as follows (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

The lease costs, which are included in operating expenses in our condensed statements of operations and comprehensive loss, were as follows (in thousands):

Three Months Ended March 31,

Operating lease expense $ 1,046 $ 1,064

Cash paid for operating lease $ 1,166 $ 1,098

The following table summarizes our undiscounted cash payment obligations for our operating lease liabilities as of September 30, 2023 (in thousands):

The following table summarizes our undiscounted cash payment obligations for our operating lease liabilities as of March 31, 2024 (in thousands):

Remainder of 2024 $ 3,550

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Operating lease liability, net of current portion $ 778

In March 2023, we entered into a sub-lease Agreement (Sub-lease) with Chronus Health, Inc.

The Sub-lease permits use by Chronus of a portion of the space in our facility in Fremont, California.

We lease the facility from a different counterparty under a separate head lease that commenced in September 2008 and has been amended multiple times to add space and to extend the lease term through March 2025.

We have sub-leased to Chronus approximately 21,644 square feet of the 72,500 square foot building's interior space, plus corresponding exterior support space and parking.

The term of the Sub-lease expires on February 1, 2025.

In accordance with the Sub-lease, we recognized an impairment of long-lived assets totaling $ 0.4 million during the three months ended March 31, 2023, which consisted primarily of impairment to the Fremont facility right-of-use asset.

The Sub-lease commenced in April 2023 and we recognized $ 0.2 million and $ 0.5 million of income from the Sub-lease during the three and nine months ended September 30, 2023, respectively.

In August 2023, we entered into an amendment to the lease agreement (the Waltham lease) for our Waltham, Massachusetts facility to expand the leased premises to include an additional 4,247 square feet of office space.

We recorded an additional $ 0.3 million right-of-use asset and lease liability for the Waltham lease upon commencement of the lease.

STOCKHOLDERS’ EQUITY

At the Market Offerings Agreement

In August 2021, we filed an additional prospectus supplement under a Registration Statement which was filed in July 2020 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 we were authorized to issue and sell, from time to time, under a sales agreement (2021 Open Market Sales Agreement) we entered into with Jefferies LLC (Jefferies) , pursuant to which we, from time to time, sold up to $ 150.0 million in shares of our common stock through Jefferies.

Pursuant to the 2021 Open Market Sales Agreement, Jefferies, as our sales agent, received a commission of up to 3 % of the gross sales price for shares of common stock sold under the 2021 Open Market Sales Agreement.

As of March 2023, we had received the maximum gross proceeds of $ 150.0 million under the 2021 Open Market Sales Agreement, which included 15.5 million shares of our common stock for which we received gross proceeds of $ 51.9 million during the quarter ended March 31, 2023.

In July 2020, we filed a Form S-3 registration statement, which became effective in August 2020 (2020 Registration Statement).

In August 2021, we filed a prospectus supplement under the 2020 Registration Statement 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 (2021 Open Market Sales Agreement) we entered into with Jefferies LLC (Jefferies), pursuant to which we may, from time to time, sell up to $ 150.0 million in shares of our common stock through Jefferies.

Pursuant to the 2021 Open Market Sales Agreement, Jefferies, as our sales agent, receives a commission of up to 3.0 % of the gross sales price for shares of common stock sold under the 2021 Open Market Sales Agreement.

As of March 2023, we had received the maximum gross proceeds of $ 150.0 million under the 2021 Open Market Sales Agreement at a weighted average share price of approximately $ 1.57 per share, which included 15.5 million shares of our common stock for which we received gross proceeds of $ 51.9 million at a weighted average share price of approximately $ 3.35 during the quarter ended March 31, 2023.

In January 2023, we filed a Form S-3 registration statement, which became effective in January 2023 (2023 Registration Statement), 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;

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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.

During the three months ended September 30, 2023, we completed sales pursuant to the 2023 Open Market Sales Agreement resulting in the issuance of 13.8 million shares of our common stock and receipt of gross proceeds of $ 58.4 million at a weighted average sales price of approximately $ 4.24 per share.

During the nine months ended September 30, 2023, we 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 per share.

During the three months ended March 31, 2024 and 2023, we completed no sales pursuant to the 2023 Open Market Sales Agreement.

As of March 31, 2024, we have sold 16.8 million shares of our common stock and received gross proceeds of $ 70.0 million at a weighted average sales price of approximately $ 4.17 per share under the 2023 Open Market Sales Agreement.

EQUITY INCENTIVE PLANS

Stock-Based Compensation

Stock-based compensation expense recognized for stock options, restricted stock units (RSUs), and our employee stock purchase program (ESPP) are recorded as operating expenses in our condensed statements of operations and comprehensive income (loss), as follows (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Selling, general and administrative $ 5,646 $ 2,088

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Total $ 7,616 $ 2,912

As of September 30, 2023, our total unrecognized stock-based compensation expense, net of estimated forfeitures, and average remaining vesting period, included the following (dollars in thousands):

As of March 31, 2024, our total unrecognized stock-based compensation expense, net of estimated forfeitures, and average remaining vesting period, included the following (dollars in thousands):

Unrecognized Compensation Expense Average Remaining Vesting Period (Years)

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Stock Options

A summary of our stock option activity and related information for the nine months ended September 30, 2023 is as follows (in thousands, except dollar amounts):

A summary of our stock option activity and related information for the three months ended March 31, 2024 is as follows (in thousands, except dollar amounts):

Number of Shares Weighted-Average

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Options forfeited or canceled ( 178 ) $ 2.83

Balance at September 30, 2023 21,204 $ 4.18

Exercisable at September 30, 2023 11,209 $ 5.46

Balance at March 31, 2024 27,790 $ 5.29

Exercisable at March 31, 2024 12,856 $ 5.29

Restricted Stock Units

A summary of our RSUs activity and related information for the nine months ended September 30, 2023 is as follows (in thousands, except dollar amounts):

A summary of our RSUs activity and related information for the three months ended March 31, 2024 is as follows (in thousands, except dollar amounts):

RSUs Weighted-Average

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Forfeited ( 60 ) $ 2.64

Non-vested restricted stock units at September 30, 2023 2,923 $ 2.67

Non-vested restricted stock units at March 31, 2024 7,935 $ 6.37

Employee Stock Purchase Plan

During the nine months ended September 30, 2023, we sold approximately 0.4 million shares of our common stock under the ESPP.

During the three months ended March 31, 2024, we sold approximately 0.3 million shares of our common stock under the ESPP.

The shares were purchased by employees at an average purchase price of $ 4.10 per share resulting in proceeds to us of approximately $ 1.0 million.

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Under Our Amended and Restated Non-Employee Director Compensation Program, members of our board of directors may elect to receive shares of our stock in lieu of their cash fees.

During the nine months ended September 30, 2023, we issued 0.1 million shares of our common stock to members of the board of directors in accordance with the program.

NET INCOME (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, less shares subject to repurchase, and excludes any dilutive effects of stock-based awards and warrants.

During the three months ended March 31, 2024, we issued no shares of our common stock to members of the board of directors in accordance with the program.

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 effects of stock-based awards and warrants.

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, and unvested restricted common stock and stock units.

As we had net losses for the nine months ended September 30, 2023 and 2022, all potential common shares were determined to be anti-dilutive.

As we had net losses for the three months ended March 31, 2024 and 2023, all potential common shares were determined to be anti-dilutive.

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,

2023 2022 2023 2022

Net income (loss) $ 6,629 $ ( 22,893 ) $ ( 37,265 ) $ ( 77,902 )

Three Months Ended March 31,

Net loss $ ( 26,518 ) $ ( 26,773 )

Weighted average common shares outstanding - basic 233,066 207,023

Weighted average common shares outstanding - diluted 233,066 207,023

Net income (loss) per share of common stock - basic and diluted $ 0.03 $ ( 0.14 ) $ ( 0.17 ) $ ( 0.53 )

Net loss per share of common stock - basic and diluted $ ( 0.11 ) $ ( 0.13 )

For the periods presented, 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 (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Options to purchase common stock 26,681 19,855

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On July 19, 2022, the court consolidated the two putative class actions and appointed a lead plaintiff and lead counsel.

The lead plaintiff filed an amended complaint on September 29, 2022.

Defendants filed a motion to dismiss the amended complaint on December 2, 2022.

In January and February 2023, in lieu of filing a response to defendant’s motion to dismiss, plaintiffs filed a motion seeking leave to further amend their complaint and defendants filed an opposition to the motion for leave to further amend the complaint.

On April 6, 2023, the court granted plaintiff’s motion for leave to further amend the complaint.

With the second amended complaint, the plaintiffs seek to represent all persons who purchased or otherwise acquired Ardelyx securities between March 6, 2020 and July 19, 2021.

The lead plaintiff filed a second amended complaint under which the plaintiffs seek to represent all persons who purchased or otherwise acquired Ardelyx securities between March 6, 2020 and July 19, 2021.

Defendants filed a motion to dismiss the amended complaint on June 2, 2023.

On August 22, 2023, the court cancelled the hearing scheduled for September 14, 2023 on the motion to dismiss the amended complaint and indicated its decision to instead rule on the filed briefs.

On March 22, 2024, the court granted defendants’ motion to dismiss.

The court provided plaintiffs a third opportunity to amend and plaintiffs filed a third amended complaint on April 19, 2024.

Defendant's motion to dismiss the third amended complaint is required to be filed by June 3, 2024.

We believe the plaintiff’s claims are without merit and we have not recorded any accrual for a contingent liability associated with these legal proceedings.

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From time to time, we may be involved in legal proceedings arising in the ordinary course of business.

As of September 30, 2023, there is no litigation pending that would reasonably be expected to have a material adverse effect on our results of operations and financial condition, and no contingent liabilities were accrued as of September 30, 2023.

SUBSEQUENT EVENTS

Deferred Royalty Obligation Related to the Sale of Future Royalties) .

We received these payments in October 2023.

On October 17, 2023, we announced that the FDA approved XPHOZAH ® (tenapanor) to reduce serum phosphorus in adults with chronic kidney disease 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.

The FDA approval of XPHOZAH results in a number of financial implications that will be recognized in the fourth quarter of 2023 including payment of the 2018 Exit Fee, which was paid in October 2023 (see Note 8.

Borrowing and Note 9.

Derivative Liabilities ), the achievement of a $ 3.0 million development milestone from Fosun Pharma (See Note 6.

Collaboration and Licensing Agreements ), and our ability to draw the Term B Loan from SLR (See Note 8.

Also on October 17, 2023, we entered into a Third Amendment (the Third Amendment) to the 2022 Loan Agreement by and between us and the 2022 Lenders.

The Third Amendment, among other things, (1) provides us with the option to draw an additional $ 50.0 million of committed capital by March 15, 2024 (the Term C Loan);

(2) provides us with the option to draw up to an additional $ 50.0 million of uncommitted capital, subject to approval by the Agent's investment committee (the Term D Loan);

and (3) extends the interest-only period for the Four Loans to December 31, 2026, effective upon our decision to draw the Term B Loan in the amount of $ 22.5 million.

We provided the Agent with notice of our decision to draw the Term B Loan in October 2023 to support the commercial launch of XPHOZAH (See Note 8.

Borrowing for additional information related to borrowing).

As of March 31, 2024, there is no litigation pending that would reasonably be expected to have a material adverse effect on our results of operations and financial condition, and no contingent liabilities were accrued as of March 31, 2024.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements