ArriVent BioPharma, Inc. 10-Q

Item 1. Financial Statements ARRIVENT BIOPHARMA, INC. CONDENSED BALANCE SHEETS (in thousands, except share and per share data) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Assets ​ ​ ​ ​ ​ ​ ​ ​ Current assets: ​ ​ ​ ​ Cash and cash equivalents ​ $ 154,682 ​ $ 45,540 Short-term investments ​ ​ 218,437 ​ ​ 267,281 Prepaid expenses and other current assets ​ 21,054 ​ 20,076 Total current assets ​ 394,173 ​ 332,897 Right of use assets – operating leases ​ 370 ​ 13 Deferred offering costs ​ ​ 41 ​ ​ 69 Other assets ​ 134 ​ 190 Total assets ​ $ 394,718 ​ $ 333,169 ​ ​ ​ ​ ​ ​ ​ Liabilities and Stockholders’ Equity ​ ​ ​ ​ Current liabilities: ​ ​ ​ ​ Accounts payable ​ $ 2,217 ​ $ 5,934 Accrued expenses ​ 25,309 ​ 19,997 Operating lease liabilities ​ 318 ​ 14 Total current liabilities ​ 27,844 ​ 25,945 Operating lease liabilities, net of current amount ​ 33 ​ — Total liabilities ​ 27,877 ​ 25,945 ​ ​ ​ ​ ​ ​ ​ Commitments and contingencies (Note 8) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stockholders’ equity: ​ ​ ​ ​ ​ ​ Preferred stock $ 0.0001 par value, 10,000,000 shares authorized; no shares issued and outstanding ​ — ​ — Common stock $ 0.0001 par value, 200,000,000 shares authorized; 48,319,591 and 42,452,251 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively ​ ​ 5 ​ ​ 4 Additional paid-in capital ​ 864,957 ​ 711,847 Accumulated deficit ​ ( 497,854 ) ​ ( 404,641 ) Accumulated other comprehensive income (loss) ​ ​ ( 267 ) ​ ​ 14 Total stockholders’ equity ​ 366,841 ​ 307,224 Total liabilities and stockholders’ equity ​ $ 394,718 ​ $ 333,169 ​ The accompanying notes are an integral part of the unaudited interim financial statements. ​ 5 Table of Contents ​ ARRIVENT BIOPHARMA, INC. CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (in thousands, except share and per share data) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ Six Months Ended ​ ​ ​ June 30, ​ June 30, ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 ​ Operating expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ Research and development $ 42,339 $ 27,720 $ 79,957 $ 89,009 ​ General and administrative ​ 10,352 ​ 5,903 ​ 18,844 ​ 11,386 ​ Total operating expenses ​ 52,691 ​ 33,623 ​ 98,801 ​ 100,395 ​ Operating loss ​ ( 52,691 ) ​ ( 33,623 ) ​ ( 98,801 ) ​ ( 100,395 ) ​ Interest and investment income ​ ​ 2,798 ​ 2,224 ​ 5,588 ​ 4,609 ​ Net loss ​ ​ ( 49,893 ) ​ ​ ( 31,399 ) ​ ​ ( 93,213 ) ​ ​ ( 95,786 ) ​ Unrealized gain (loss) on investments ​ ​ 3 ​ ​ ( 1 ) ​ ​ ( 282 ) ​ ​ 193 ​ Total other comprehensive gain (loss) ​ ​ 3 ​ ​ ( 1 ) ​ ​ ( 282 ) ​ ​ 193 ​ Total comprehensive loss ​ $ ( 49,890 ) ​ $ ( 31,400 ) ​ $ ( 93,495 ) ​ $ ( 95,593 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Share information: ​ ​ ​ ​ ​ ​ ​ ​ ​ Net loss per share attributable to common stockholders, basic and diluted ​ $ ( 1.05 ) ​ $ ( 0.90 ) ​ $ ( 2.01 ) ​ $ ( 2.78 ) ​ Weighted-average shares of common stock outstanding, basic and diluted ​ 47,606,857 ​ 35,006,114 ​ 46,351,614 ​ 34,455,585 ​ ​ The accompanying notes are an integral part of the unaudited interim financial statements. ​ ​ ​ 6 Table of Contents ARRIVENT BIOPHARMA, INC. CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) (in thousands, except share data) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ Other ​ ​ ​ ​ ​ ​ ​ ​ ​ Common stock ​ paid-in ​ Comprehensive ​ Accumulated ​ ​ ​ ​ ​ ​ Shares ​ ​ ​ Amount ​ ​ ​ capital ​ ​ ​ (Loss) ​ ​ ​ deficit ​ ​ ​ Total Balance January 1, 2026 ​ 42,452,251 ​ $ 4 ​ $ 711,847 ​ $ 14 ​ $ ( 404,641 ) ​ $ 307,224 Issuance of common stock, net of issuance costs of $ 2,418 ​ 2,425,495 ​ 1 ​ 54,724 ​ ​ — ​ — ​ 54,725 Exercise of stock options ​ 31,195 ​ — ​ 150 ​ ​ — ​ — ​ 150 Exercise of pre-funded warrants ​ ​ 400,000 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — Stock-based compensation expense ​ — ​ — ​ 5,485 ​ ​ — ​ — ​ 5,485 Unrealized loss on investments ​ ​ — ​ — ​ — ​ ​ ( 284 ) ​ — ​ ( 284 ) Net loss ​ — ​ — ​ — ​ ​ — ​ ( 43,320 ) ​ ( 43,320 ) Balance March 31, 2026 ​ 45,308,941 ​ ​ 5 ​ ​ 772,206 ​ ​ ( 270 ) ​ ​ ( 447,961 ) ​ ​ 323,980 Issuance of common stock, net of issuance costs of $ 2,509 ​ ​ 2,932,823 ​ ​ — ​ ​ 85,234 ​ ​ — ​ ​ — ​ ​ 85,234 Exercise of stock options ​ 77,827 ​ — ​ 852 ​ ​ — ​ — ​ 852 Stock-based compensation expense ​ — ​ — ​ 6,665 ​ ​ — ​ — ​ 6,665 Unrealized gain on investments ​ ​ — ​ — ​ — ​ ​ 3 ​ — ​ 3 Net loss ​ — ​ — ​ — ​ ​ — ​ ( 49,893 ) ​ ( 49,893 ) Balance, June 30, 2026 ​ 48,319,591 ​ $ 5 ​ $ 864,957 ​ $ ( 267 ) ​ $ ( 497,854 ) ​ $ 366,841 ​ The accompanying notes are an integral part of the unaudited interim financial statements. ​ 7 Table of Contents ARRIVENT BIOPHARMA, INC. CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) (in thousands, except share data) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ Other ​ ​ ​ ​ ​ ​ ​ ​ ​ Common stock ​ paid-in ​ Comprehensive ​ Accumulated ​ ​ ​ ​ ​ ​ Shares ​ ​ ​ Amount ​ ​ ​ capital ​ ​ ​ (Loss) ​ ​ ​ deficit ​ ​ ​ Total Balance January 1, 2025 ​ 33,706,765 ​ $ 3 ​ $ 496,195 ​ $ ( 211 ) ​ $ ( 238,333 ) ​ $ 257,654 Issuance of common stock, net of issuance costs of $ 858 ​ 264,458 ​ 1 ​ 6,516 ​ ​ — ​ — ​ 6,517 Exercise of stock options ​ 69,773 ​ — ​ 293 ​ ​ — ​ — ​ 293 Stock-based compensation expense ​ — ​ — ​ 2,271 ​ ​ — ​ — ​ 2,271 Unrealized gain on investments ​ ​ — ​ — ​ — ​ ​ 194 ​ — ​ 194 Net loss ​ — ​ — ​ — ​ ​ — ​ ( 64,387 ) ​ ( 64,387 ) Balance March 31, 2025 ​ 34,040,996 ​ ​ 4 ​ ​ 505,275 ​ ​ ( 17 ) ​ ​ ( 302,720 ) ​ ​ 202,542 Issuance of common stock, net of issuance costs of $ 2,395 ​ ​ 3,428,766 ​ ​ — ​ ​ 75,341 ​ ​ — ​ ​ — ​ ​ 75,341 Exercise of stock options ​ 20,677 ​ — ​ 76 ​ ​ — ​ — ​ 76 Stock-based compensation expense ​ — ​ — ​ 3,311 ​ ​ — ​ — ​ 3,311 Unrealized loss on investments ​ ​ — ​ — ​ — ​ ​ ( 1 ) ​ — ​ ( 1 ) Net loss ​ — ​ — ​ — ​ ​ — ​ ( 31,399 ) ​ ( 31,399 ) Balance, June 30, 2025 ​ 37,490,439 ​ $ 4 ​ $ 584,003 ​ $ ( 18 ) ​ $ ( 334,119 ) ​ $ 249,870 ​ The accompanying notes are an integral part of the unaudited interim financial statements. ​ ​ ​ 8 Table of Contents ARRIVENT BIOPHARMA, INC. CONDENSED STATEMENTS OF CASH FLOWS (in thousands) (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ ​ June 30, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Cash flows from operating activities: ​ ​ ​ ​ Net loss ​ $ ( 93,213 ) ​ $ ( 95,786 ) Adjustment to reconcile net loss to net cash used in operating activities: ​ ​ ​ ​ Stock-based compensation expense ​ 12,150 ​ 5,582 Amortization (accretion) of bond premiums/discounts ​ ​ ( 1,074 ) ​ ​ — Changes in operating assets and liabilities: ​ ​ ​ ​ Prepaid expenses and other current assets ​ ( 1,008 ) ​ ( 6,346 ) Other assets ​ 84 ​ — Accounts payable ​ ​ ( 3,704 ) ​ ​ 280 Accrued expenses ​ 5,312 ​ 2,148 Operating lease liabilities ​ ( 20 ) ​ ( 10 ) Net cash used in operating activities ​ ( 81,473 ) ​ ( 94,132 ) Cash flows from investing activities: ​ ​ ​ ​ Purchase of investments ​ ( 78,376 ) ​ ( 31,385 ) Sales and maturities of investments ​ ​ 128,030 ​ ​ 82,116 Net cash used in investing activities ​ 49,654 ​ 50,731 Cash flows from financing activities: ​ ​ ​ ​ Proceeds from issuance of common stock, net of issuance costs ​ 139,959 ​ 81,857 Proceeds from the exercise of stock options ​ 1,002 ​ 369 Payment of deferred financing costs ​ — ​ ( 353 ) Net cash provided by financing activities ​ 140,961 ​ 81,873 ​ ​ ​ ​ ​ ​ ​ Net increase in cash and cash equivalents ​ 109,142 ​ 38,472 Cash and cash equivalents at beginning of the year ​ 45,540 ​ 74,293 Cash and cash equivalents at end of the year ​ $ 154,682 ​ $ 112,765 ​ ​ ​ ​ ​ ​ ​ ​ The accompanying notes are an integral part of the unaudited interim financial statements. ​ ​ 9 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS (1) Background ArriVent BioPharma, Inc., a Delaware corporation (the “Company”), founded on April 14, 2021, is a clinical-stage biopharmaceutical company focused on identifying, licensing and globalizing top biopharma innovations from around the world to deliver important medicines to patients. In June 2021, the Company entered into a license agreement with Shanghai Allist Pharmaceuticals Co. Ltd. (“Allist”) which granted the Company an exclusive license under certain intellectual property owned or controlled by Allist to develop, manufacture and commercialize any product containing firmonertinib or any of its derivatives as an active ingredient, for all uses, in all countries and territories other than greater China, which includes mainland China, Hong Kong, Macau and Taiwan (“Greater China”) (See Note 8). The Company’s lead development candidate, firmonertinib, is a third-generation tyrosine kinase inhibitor currently being evaluated in multiple clinical trials across a range of epidermal growth factor receptor mutations in non-small cell lung cancer, many for which there are limited treatment options. ​ (2) Development Stage Risks and Liquidity The Company has incurred losses since inception and has an accumulated deficit of $ 497.9 million as of June 30, 2026. The Company has concluded that the aggregate balance of cash and cash equivalents and short-term investments of $ 373.1 million as of June 30, 2026 is sufficient to sustain planned operations through at least twelve months from the issuance date of these financial statements. ​ The Company anticipates incurring additional losses until such time, if ever, that it can generate significant sales from its product candidates currently in development; as a result, additional capital will be needed to fund its future operating and capital requirements. There can be no assurance that the Company will be able to raise sufficient additional capital on acceptable terms, if at all. If such additional financing is not available on satisfactory terms, or is not available in sufficient amounts, the Company’s financial condition or results of operations may be materially adversely affected. ​ The Company is subject to those risks associated with any specialty biotechnology company that has substantial expenditures for research and development. In addition, geopolitical tensions, volatility of capital markets, and other adverse macroeconomic events, including those due to inflationary pressures, changing interest rates, bank instability and the ability of the U.S. government to manage federal debt limits, as well as the potential impact of other health crises on the global financial markets, may reduce the Company's ability to access capital, which could negatively affect its liquidity. ​ (3) Summary of Significant Accounting Policies The summary of significant accounting policies included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed with the Securities and Exchange Commission on March 5, 2026 (the “Annual Report”) has not materially changed. (a) Interim Financial Statements The accompanying unaudited condensed interim financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Any references in these notes to applicable guidance are meant to refer to GAAP as found in Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) promulgated by the Financial Accounting Standards Board (“FASB”). In the opinion of the Company, the accompanying unaudited condensed financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of June 30, 2026, and its results of operations for the three and six months ended June 30, 2026 and 2025, and cash flows for the six 10 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS months ended June 30, 2026 and 2025. The condensed balance sheet at December 31, 2025, was derived from audited annual financial statements but does not contain all the footnote disclosures from the annual financial statements. ​ (b) Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from such estimates. Estimates and assumptions are periodically reviewed, and the effects of revisions are reflected in the financial statements in the period they are determined to be necessary. Significant areas that require the Company’s estimates include the fair value of the Company’s common stock prior to the completion of the Company’s initial public offering, and accrued research and development expenses. (c) Fair Value Measurements The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: • Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. • Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. • Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. The Company believes that the carrying amounts of the Company’s financial instruments, principally cash equivalents and accounts payable, approximate fair value due to the short-term nature of those instruments. (d) Net Loss per Share Basic net loss per share of common stock is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during each period. Pre-funded warrants were included in the denominator as the exercise price is negligible and these warrants are fully vested and exercisable. Diluted net loss per share of common stock includes the effect, if any, from the potential exercise or conversion of securities, such as convertible preferred stock and stock options, which would result in the issuance of incremental shares of common stock. For diluted net loss per share, the weighted-average number of shares of common stock is the same for basic net loss per share since when a net loss exists, potentially dilutive securities are not included in the calculation as their impact is anti-dilutive. 11 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS The following table sets forth the computation of net loss per share, basic and diluted (in thousands, except share and per share data): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ ​ Six Months Ended ​ ​ June 30, ​ June 30, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Numerator: ​ ​ ​ ​ ​ ​ ​ ​ Net loss $ ( 49,893 ) $ ( 31,399 ) $ ( 93,213 ) $ ( 95,786 ) Denominator: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average shares of common stock outstanding ​ ​ 46,643,388 ​ ​ 35,006,114 ​ ​ 45,221,478 ​ ​ 34,455,585 Weighted-average pre-funded warrants outstanding (1) ​ ​ 963,469 ​ ​ — ​ ​ 1,130,136 ​ ​ — Weighted-average shares of common stock outstanding, basic and diluted ​ 47,606,857 ​ 35,006,114 ​ 46,351,614 ​ 34,455,585 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net loss per share attributable to common stockholders, basic and diluted ​ $ ( 1.05 ) ​ $ ( 0.90 ) ​ $ ( 2.01 ) ​ $ ( 2.78 ) ​ (1) Represents the weighted average number of common shares issuable upon the exercise of pre-funded warrants issued in 2025, which are considered to be outstanding for the purposes of the basic and diluted net loss per share calculation from the date of issuance due to their nominal exercise price ( $ 0.0001 ). ​ Stock options outstanding have been excluded from the computation of diluted weighted-average shares of common stock outstanding, as they would be anti-dilutive. Stock options outstanding at June 30, 2026 and 2025 were 7,301,993 and 4,325,617 , respectively. (e) Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures: Disaggregation of Income Statement Expenses . This standard requires the disclosure of more detailed information about the types of expenses in commonly presented expense captions, such as research and development, and general and administrative expenses. This standard will be effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027 and may be applied either prospectively or retrospectively. The Company is currently evaluating the impact that this standard may have on its financial statements. ​ (f) License and Collaboration Agreements ​ The Company analyzes its license and collaborative agreements to assess whether they are within the scope of ASC 808, Collaborative Arrangements (“ASC 808”) to determine whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards that are dependent on the commercial success of such activities. To the extent the arrangement is within the scope of ASC 808, the Company assesses whether aspects of the arrangement are within the scope of other accounting literature. If the Company concludes that some or all aspects of the arrangement represent a transaction with a customer, it accounts for those aspects of the arrangement within the scope of ASC 606, Revenue from Contracts with Customers . None of the license and collaboration agreements discussed in Note 8 represent transactions with customers. If the Company concludes that some or all aspects of the arrangement are within the scope of ASC 808 and do not represent a transaction with a customer, it recognizes costs incurred as a component of research and development expense in the period incurred. The arrangements may also require the Company to make payments on achievement of 12 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS certain milestones, including clinical, regulatory, and development milestones. Clinical, regulatory, and development milestones are recognized as research and development expense only when such milestones are deemed probable of being achieved. ​ (g) Other Comprehensive Income (Loss) Other comprehensive income (loss) (“OCI”) consists of expenses, gains, and losses that are excluded from net income under GAAP. The Company’s OCI includes, when applicable, unrealized gains and losses on available-for-sale debt securities. Unrealized gains and losses on available-for-sale debt securities are recorded net of tax in accumulated other comprehensive income (loss) (“AOCI”), a component of stockholders’ equity, until realized. Upon realization, these amounts are reclassified from AOCI into earnings. ​ (4) Fair Value Measurements The following tables show the Company’s cash equivalents and short-term investments’ carrying amounts, fair values, and fair value hierarchy (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, 2026 ​ Amortized Cost ​ Gross Unrealized Gains ​ Gross Unrealized Losses ​ Fair Value ​ Level 1 ​ ​ ​ Level 2 ​ ​ ​ Level 3 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Money market funds $ 84,299 ​ $ — ​ $ — ​ $ 84,299 ​ $ 84,299 ​ $ — ​ $ — Corporate securities ​ 103,670 ​ ​ 3 ​ ​ ( 106 ) ​ ​ 103,567 ​ ​ — ​ ​ 103,567 ​ ​ — Government securities ​ 115,035 ​ ​ 4 ​ ​ ( 169 ) ​ ​ 114,870 ​ ​ — ​ ​ 114,870 ​ ​ — Total assets measured at fair value $ 303,004 ​ $ 7 ​ $ ( 275 ) ​ $ 302,736 ​ $ 84,299 ​ $ 218,437 ​ $ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2025 ​ Amortized Cost ​ Gross Unrealized Gains ​ Gross Unrealized Losses ​ Fair Value ​ Level 1 ​ ​ ​ Level 2 ​ ​ ​ Level 3 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Money market funds $ 40,494 ​ $ — ​ $ — ​ $ 40,494 ​ $ 40,494 ​ $ — ​ $ — Corporate securities ​ 105,373 ​ ​ 78 ​ ​ ( 25 ) ​ ​ 105,426 ​ ​ — ​ ​ 105,426 ​ ​ — Government securities ​ 161,882 ​ ​ 116 ​ ​ ( 143 ) ​ ​ 161,855 ​ ​ — ​ ​ 161,855 ​ ​ — Total assets measured at fair value $ 307,749 ​ ​ 194 ​ ​ ( 168 ) ​ $ 307,775 ​ $ 40,494 ​ $ 267,281 ​ $ — ​ The December 31, 2025 disclosure was adjusted to reflect the classification of certain corporate securities as Level 2 of the fair value hierarchy. ​ Cash balances were $ 70.4 million and $ 5.0 million at June 30, 2026 and December 31, 2025, respectively. Money market funds are highly liquid investments. The pricing information on the Company’s money market fund is based on quoted prices in active markets. This approach results in a classification of these securities as Level 1 of the fair value hierarchy. ​ 13 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS The Company’s investment portfolio includes many securities that do not always trade on a daily basis. As a result, the pricing services used by the Company applied other available information as applicable through processes such as benchmark yields, benchmarking of like securities, sector groupings and matrix pricing to prepare evaluations. In addition, model processes were used to assess interest rate impact and develop prepayment scenarios. These models take into consideration relevant credit information, perceived market movements, sector news and economic events. The inputs into these models may include benchmark yields, reported trades, broker-dealer quotes, issuer spreads and other relevant data. ​ All short-term investments held as of June 30, 2026 and December 31, 2025 had contractual maturities of less than one year and are considered available-for-sale. No available-for-sale securities held as of the periods presented have been in a continuous material unrealized loss position for more than 12 months. To date, the Company recorded no allowances for credit losses on its investments. ​ (5) Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Research and development ​ $ 17,893 ​ $ 19,830 Professional fees ​ 468 ​ 3 Insurance ​ 680 ​ 183 Other ​ 2,013 ​ 60 Total prepaid expenses and other current assets ​ $ 21,054 ​ $ 20,076 ​ ​ (6) Accrued Expenses Accrued expenses consisted of the following (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ December 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Research and development ​ $ 20,522 ​ $ 13,142 Professional fees ​ 1,118 ​ 292 Compensation and related expenses ​ 3,668 ​ 6,545 Other accrued expenses ​ 1 ​ 18 Total accrued expenses ​ $ 25,309 ​ $ 19,997 ​ ​ (7) Stock-based Compensation In June 2021, the Company adopted the 2021 Employee, Director and Consultant Equity Incentive Plan, as amended (the “2021 Plan”), that authorized the Company to grant up to 803,564 shares of common stock via stock-based compensation awards. In 2022, the Company amended the 2021 Plan and increased the total number of shares authorized under the 2021 Plan to 2,748,818 . In January 2024, the Company adopted the 2024 Employee, Director and Consultant Equity Incentive Plan (the “2024 Plan”) that authorized the Company to grant up to 3,900,000 shares of common stock plus any remaining ungranted or forfeited shares from the 2021 Plan. As of June 30, 2026, there were 2,545,021 shares available to be granted under the 2024 Plan. The Company’s stock options vest based on the terms in the awards 14 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS agreements and generally vest over four years . The Company recorded stock-based compensation expense in the following expense categories in its accompanying statements of operations and comprehensive loss (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Six Months Ended ​ ​ June 30, ​ June 30, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Research and development ​ $ 3,160 ​ $ 1,495 ​ $ 5,462 ​ $ 2,480 General and administrative ​ 3,505 ​ 1,816 ​ 6,688 ​ 3,102 Total stock-based compensation expense ​ $ 6,665 ​ $ 3,311 ​ $ 12,150 ​ $ 5,582 ​ The following is a summary of stock options activity: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ ​ ​ ​ Weighted ​ average ​ ​ ​ ​ ​ ​ average ​ remaining ​ Aggregate ​ ​ ​ ​ exercise ​ contractual ​ Intrinsic Value ​ ​ ​ ​ Options ​ ​ ​ price ​ ​ ​ term (years) ​ ​ ​ (in thousands) Outstanding as of December 31, 2025 4,328,880 ​ $ 15.56 ​ ​ ​ ​ Granted 3,284,498 ​ 23.32 ​ ​ ​ Exercised ( 109,022 ) ​ 9.48 ​ ​ ​ ​ Forfeited/Expired ​ ( 202,363 ) ​ ​ 21.65 ​ ​ ​ ​ ​ Outstanding as of June 30, 2026 7,301,993 ​ $ 18.97 ​ 8.50 ​ $ 115,100 Exercisable as of June 30, 2026 2,220,464 ​ $ 11.19 7.02 ​ $ 52,281 Vested and expected to vest at June 30, 2026 7,301,993 ​ $ 18.97 ​ 8.50 ​ $ 115,100 ​ The weighted-average grant-date fair value of options granted during the six months ended June 30, 2026 and 2025, were $ 17.44 and $ 21.31 per share, respectively. The fair value was estimated using the Black-Scholes option-pricing model based on the following assumptions: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ ​ June 30, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Risk-free interest rate ​ 3.72 % - 4.26 % ​ ​ 3.92 % - 4.37 % Expected term ​ 5.5 - 6.1 years ​ 5.5 - 6.1 years Expected volatility ​ 74.0 % - 87.3 % ​ ​ 97.2 % - 98.3 % Expected dividend yield ​ — ​ — ​ Unrecognized compensation cost for awards not vested as of June 30, 2026 was $ 79.5 million and will be expensed over a weighted-average period of 3.04 years. ​ ​ (8) Commitments, Contingencies, and Collaborations The Company entered into various license and collaboration agreements under which it is obligated to make contingent payments as described below. Allist ​ In June 2021, the Company entered into a Global Technology Transfer and License Agreement with Allist (“Allist Agreement”). Pursuant to the Allist Agreement, the Company was granted an exclusive license under certain intellectual property to develop, manufacture and commercialize certain licensed products in the field in the 15 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS licensed territory. Upon execution of the Allist Agreement, the Company paid Allist a non-refundable cash payment of $ 40.0 million and issued 1,276,250 shares of its common stock. The upfront payment and the fair value of the common stock issued was recorded to research and development expense in 2021. ​ Under the Allist Agreement, upon the achievement of certain clinical, regulatory and commercial milestones using the licensed technology, the Company is obligated to make total milestone payments to Allist of up to $ 110.0 million in clinical and regulatory milestones and up to $ 655.0 million in commercial milestones. Furthermore, royalties, ranging from high single digit to low mid-teen percentages will be payable to Allist on net sales of licensed products in licensed territories. ​ In connection with the Allist Agreement, in December 2021, the parties also entered into a Joint Clinical Collaboration Agreement (“Clinical Collaboration”) to define the framework under which the parties will cooperate and share costs related to global clinical studies to be conducted jointly by the Company and Allist. The Company incurred cost reimbursements to Allist under the Clinical Collaboration of $ 1.5 million and $ 0.1 million for the three months ended June 30, 2026 and 2025, respectively, and $ 1.9 million and $ 0.6 million for the six months ended June 30, 2026 and 2025, respectively. These amounts were recorded as research and development expense. The Company also received cost reimbursements from Allist of $ 0.4 million and $ 0.2 million for the three months ended June 30, 2026 and 2025, respectively, and $ 0.7 million and $ 0.6 million for the six months ended June 30, 2026 and 2025, respectively. These amounts were recorded as a reduction of research and development expense. To date, the Company has incurred $ 10.0 million for the achievement of certain clinical milestones under the Allist Agreement. Through June 30, 2026, no additional milestones have been met or achieved, or are probable of achievement, subsequent to the milestones noted above. ​ Alphamab ​ In June 2024, the Company entered into a collaboration agreement with Jiangsu Alphamab Biopharmaceuticals Co., Ltd. (“Alphamab”) to discover, develop and commercialize novel antibody drug conjugates (“ADCs”) for the treatment of cancers (“Alphamab Agreement”). ​ Under the Alphamab Agreement, both companies seek to leverage Alphamab’s proprietary linker-payload platform and glycan-conjugation technology to identify novel ADCs for oncology indications. The Alphamab Agreement gives the Company exclusive rights to develop and commercialize ADCs globally, except Greater China, where Alphamab retains the right to develop and commercialize the ADCs. ​ The terms of the Alphamab Agreement include combined total upfront and potential milestone payments to Alphamab of up to $ 201.5 million based on the achievement of certain regulatory and development milestones, and up to $ 414.0 million based on the achievement of certain commercial milestones. In addition, Alphamab is entitled to receive tiered sales royalties, ranging from low single digit to mid-single digit percentages, from the Company for net sales of each ADC product. ​ The upfront payment was recorded to research and development expense during the year ended December 31, 2024. During the three and six months ended June 30, 2025, the Company incurred $ 0.1 million in cost reimbursements to Alphamab under the Alphamab Agreement which have been recorded as research and development expense. During the three and six months ended June 30, 2026, the Company incurred $ 1.9 million and $ 3.8 million in cost reimbursements, respectively, to Alphamab. During the six months ended June 30, 2025, the Company paid $ 1.2 million upon the approval of each target pair selection for a total of $ 2.4 million, which was also included in research and development expense. Through June 30, 2026, no additional milestones have been met or achieved, or are probable of achievement, subsequent to the milestones noted above. ​ 16 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS Aarvik ​ In December 2021, the Company entered into a Research Collaboration Agreement, as amended, effective June 30, 2023 (the “Aarvik Collaboration Agreement”), with Aarvik Pharmaceuticals, Inc. (“Aarvik”), under which the Company has entered into various statements of work (“SOWs”). After the completion of the SOWs, the Company has an exclusive option to license the Aarvik intellectual property, and the option to acquire certain of Aarvik’s intellectual property, after which it is the Company’s sole responsibility to research, develop, manufacture and commercialize any applicable compound and product in the field and territory. In August 2024, the Company paid $ 1.0 million to exercise that option, and as a result is now obligated to pay up to $ 18.0 million per product upon the achievement of certain clinical and regulatory milestone events and up to $ 80.0 million per product in commercial milestones. Additionally, the Company is obligated to pay Aarvik royalties in the mid-single digits based on net sales of licensed products. ​ On August 9, 2024, the Company entered into an amendment and restatement of the Aarvik Collaboration Agreement, as amended on July 2, 2025 (the “Amended and Restated Aarvik Collaboration Agreement”). Under the Amended and Restated Aarvik Collaboration Agreement, Aarvik granted the Company an exclusive option to obtain exclusive rights to certain of Aarvik’s intellectual property for the research, development, manufacture, use, commercialization, or other exploitation of the ADCs related to (i) the two agreed targets to which the compounds developed under the collaboration bind, and (ii) the acquisition of exclusive rights to certain intellectual property generated during the collaboration. ARR-002, a novel tetravalent MUC16/NaPi2b targeting ADC, was discovered through the collaboration with Aarvik. ​ The Company incurred $ 0.2 million and $ 0.3 million, respectively, in research and development expenses related to the Aarvik SOWs during the three and six months ended June 30, 2025. The Company incurred $ 0.1 million in research and development expenses related to the Aarvik SOWs during the three and six months ended June 30, 2026. Through June 30, 2026, no milestones have been met or achieved, or are probable of achievement, since the inception of the Aarvik Collaboration Agreement. ​ Lepu ​ On January 21, 2025, the Company entered into an Exclusive License Agreement (the “Lepu Biopharma Agreement”) with Lepu Biopharma Co., Ltd. (“Lepu”), pursuant to which Lepu granted the Company a right to develop and commercialize ARR-217, an ADC for gastrointestinal cancers outside Greater China. ​ Under the Lepu Biopharma Agreement, Lepu granted to the Company: (i) an exclusive, royalty-bearing, sublicensable license under certain intellectual property owned or controlled by Lepu, to develop, manufacture and commercialize any product containing ARR-217 for all uses in all countries and territories other than Greater China (the “ArriVent Territory”); and (ii) a non-exclusive license under certain intellectual property controlled by Lepu to develop, manufacture and commercialize any product containing ARR-217 for use in oncology in the ArriVent Territory. Under the Lepu Biopharma Agreement, the Company paid Lepu a one-time upfront payment of $ 40.0 million which was included in research and development expense. Lepu is eligible to receive total milestone payments of up to $ 0.28 billion in development and regulatory milestones, and up to $ 0.89 billion in commercial milestones, and tiered royalties in high single-digit to low-teen percentages on net sales in the ArriVent Territory. ​ During the three months ended June 30, 2025, the Company paid $ 1.0 million to Lepu for the achievement of the first developmental milestone under the Lepu Biopharma Agreement as it became probable of achievement during the second quarter. During the six months ended June 30, 2026, Lepu earned $ 12.0 million developmental milestone payments, of which $ 6.0 million has been paid as of June 30, 2026. Through June 30, 2026, no additional milestones have been met or achieved, or are probable of achievement, subsequent to the milestones noted above. 17 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS During the three and six months ended June 30, 2026, the Company incurred an additional $ 2.3 million and $ 3.3 million, respectively, in research and development expenses related to the Lepu Biopharma Agreement, compared to $ 0.2 million for both the three and six months ended June 30, 2025. ​ (9) Segment Information Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources in assessing performance. The Company has one reportable and operating segment: life science. The life science segment is engaged in identifying, licensing and globalizing top biopharma innovations from around the world to deliver important medicines to patients. The Company’s chief operating decision maker (“CODM”) is the chief executive officer. ​ The accounting policies of the life science segment are the same as those described in the summary of significant accounting policies. The CODM assesses performance for the life science segment based on net loss, which is reported on the condensed statement of operations and comprehensive loss. The measure of segment assets is reported on the balance sheet as total assets. All the Company’s assets are located in the United States. ​ To date, the Company has not generated any product revenue. The Company expects to continue to incur significant expenses and operating losses for the foreseeable future as it advances product candidates through all stages of development and clinical trials and, ultimately, seeks regulatory approval. ​ As such, the CODM uses cash forecast models in deciding how to invest into the life science segment. Such cash forecast models are reviewed to assess the entity-wide operating results and performance. Net loss is used to monitor budget versus actual results. Monitoring budgeted versus actual results is used in assessing performance of the segment, establishing cash forecast models and to optimize the distribution of resources across functions, therapeutic areas and research and development programs. ​ 18 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS The table below summarizes the significant expense categories regularly provided to the CODM for the three and six months ended June 30, 2026 and 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Six Months Ended ​ ​ June 30, ​ June 30, (in thousands) ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2026 ​ ​ ​ 2025 Operating expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Research and development: Firmonertinib (excluding personnel-related and other internal costs): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ FURTHER ​ $ 1,612 ​ $ 2,848 ​ $ 3,350 ​ $ 5,443 FAVOUR ​ ​ 96 ​ ​ 71 ​ ​ 427 ​ ​ 73 Phase 3 Trials ​ ​ 14,792 ​ ​ 9,790 ​ ​ 23,922 ​ ​ 19,235 Other Firmonertinib costs ​ ​ 1,447 ​ ​ 3,773 ​ ​ 5,331 ​ ​ 6,034 Total Firmonertinib ​ ​ 17,947 ​ ​ 16,482 ​ ​ 33,030 ​ ​ 30,785 Research and development: Early-stage programs ​ ​ 13,383 ​ ​ 3,625 ​ ​ 25,690 ​ ​ 44,606 Research and development: Personnel-related and other internal costs ​ ​ 11,009 ​ ​ 7,612 ​ ​ 21,237 ​ ​ 13,617 General and administrative: Personnel-related costs ​ ​ 6,590 ​ ​ 3,461 ​ ​ 12,773 ​ ​ 6,792 General and administrative: Other costs ​ ​ 3,762 ​ ​ 2,443 ​ ​ 6,071 ​ ​ 4,594 Other segment items (a) ​ ​ ( 2,798 ) ​ ​ ( 2,224 ) ​ ​ ( 5,588 ) ​ ​ ( 4,609 ) Net loss ​ $ 49,893 ​ $ 31,399 ​ $ 93,213 ​ $ 95,786 ​ (a) Other segment items consists of interest and investment income. ​ (10) Common Stock “At-the-Market” Offering On February 3, 2025, the Company filed an automatic shelf registration statement on Form S-3ASR with the SEC pursuant to which the Company registered for sale an indeterminate amount of any combination of its common stock, preferred stock, debt securities, warrants, rights and units from time to time and at prices and on terms that the Company may determine, which is referred to as the “2025 WKSI Shelf”. The 2025 WKSI Shelf includes a prospectus supplement (the “2025 Prospectus Supplement”) covering up to an aggregate of $ 250.0 million of shares of common stock that the Company is able to issue and sell from time to time, through Jefferies LLC (“Jefferies”), acting as its sales agent, pursuant to the Open Market Sale Agreement SM , dated February 3, 2025 (the “Sale Agreement”), for its “at-the-market” equity program. On May 11, 2026, the Company filed a prospectus supplement (the “2026 Prospectus Supplement”) to the 2025 WKSI Shelf with respect to the Company’s “at-the-market” equity offering program. Pursuant to the 2026 Prospectus Supplement, the Company may offer and sell shares of its common stock having an aggregate offering price of up to an additional $ 250.0 million, through Jefferies acting as its sales agent, pursuant to the Sale Agreement. Under the Sale Agreement, Jefferies may sell shares of the Company’s common stock by any method permitted by law deemed to be an “at-the-market” offering as defined in Rule 415 of the Securities Act of 1933, as amended, subject to the terms of the Sale Agreement. During the six months ended June 30, 2026, the Company sold 5,358,318 shares of common stock pursuant to the Sale Agreement for total net proceeds of $ 140.0 million, net of commissions and offering costs. As of June 30, 2026, the Company has approximately $ 229.1 million remaining for future issuances of common stock pursuant to the Sale Agreement. 19 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS July 2025 Public Offering On July 3, 2025, the Company closed an underwritten public offering in which the Company issued and sold an aggregate of 3,059,615 shares of its common stock, including the exercise in full of the underwriters’ option to purchase 576,923 additional shares of common stock, at a public offering price of $ 19.50 per share, and, in lieu of shares of common stock to certain investors, pre-funded warrants to purchase up to 1,363,469 shares of common stock at a public offering price of $ 19.4999 per pre-funded warrant, which represents the per share public offering price for the shares less the $ 0.0001 per share exercise price for each pre-funded warrant. The pre-funded warrants were recorded as a component of shareholders’ equity within additional paid-in-capital and have no expiration date. As of June 30, 2026, 400,000 of the pre-funded warrants have been exercised. The proceeds to the Company of this July 2025 offering, net of underwriting discounts, commissions, and other expenses were $ 80.5 million. ​ The pre-funded warrants are exercisable at any time after their original issuance. A holder of pre-funded warrants may not exercise the pre-funded warrant if the holder, together with its affiliates, would beneficially own more than 4.99 %, or, at the election of such holder upon issuance, 9.99 %, of the number of shares of common stock outstanding or more than 4.99 %, or, at the election of such holder upon issuance, 9.99 %, of the combined voting power of the Company’s securities outstanding immediately after giving effect to such exercise. A holder of pre-funded warrants may increase or decrease this percentage to any other percentage not exceeding 19.99 %, in the case of an increase, upon 61 days ’ prior notice to the Company. ​ (11) Debt On May 8, 2025, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) between the Company, as borrower (the “Borrower”) and Silicon Valley Bank, a Division of First-Citizens Bank & Trust Company (the “Bank”), pursuant to which, the Bank agreed to extend up to $ 75.0 million to the Company (the “Term Loan”), consisting of: (i) a first tranche commitment of $ 35.0 million to be drawn at the Company’s option, subject to the satisfaction of certain conditions, (ii) a second tranche commitment of up to $ 15.0 million to be drawn at the Company’s option, subject to the satisfaction of certain conditions, and (iii) at the Company’s option, subject to the satisfaction of certain conditions, a third tranche commitment of $ 25.0 million. If not drawn, each tranche commitment is subject to an expiration date. In March 2026, the Company entered into an amendment of the Loan Agreement in which one of the conditions of the second tranche commitment was eliminated. No amounts have been drawn on this Term Loan as of June 30, 2026. ​ The Term Loan matures on March 1, 2030 (or, if the Borrower does not satisfy certain conditions, on March 1, 2029) unless otherwise accelerated following the occurrence and continuation of an event of default pursuant to the terms of the Loan Agreement. Amounts borrowed under the Term Loan bear interest at a variable annual rate equal to the greater of (i) 6.00 %, and (ii) (A) the Prime Rate , minus (B) 0.75 %. The Borrower may, at its option, prepay the Term Loan subject to a prepayment premium. ​ The Borrower’s obligations are secured by a first priority, perfected lien on substantially all the property and assets of the Borrower, except for intellectual property (other than the security interest in proceeds from any intellectual property) and certain other customary excluded assets as set forth therein. ​ ​ (12) Subsequent Event On August 11, 2026, the Company entered into a Collaboration and License Agreement (the “Allist License Agreement”) with Allist, pursuant to which the Company granted Allist a right to develop and commercialize ARR-002 in Greater China, which includes mainland China, Hong Kong, Macau and Taiwan (the “Licensed Territory”), subject to the Company’s retained right to manufacture ARR-002 in the Licensed Territory. The Allist License Agreement also includes a Clinical Collaboration Agreement, under which the Company and Allist collaborate on certain global clinical 20 Table of Contents ARRIVENT BIOPHARMA, INC. NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS studies of ARR-002, and a Clinical Supply Agreement under which the Company is responsible for supplying ARR-002 for the initial joint global clinical study. ​ Under the Allist License Agreement, the Company granted to Allist an exclusive, sublicensable, royalty-bearing license under certain intellectual property owned or controlled by the Company, to research, develop, manufacture, and commercialize ARR-002 for the diagnosis, prophylaxis and treatment of diseases and conditions in the Licensed Territory, subject to the Company’s retained right to manufacture ARR-002 in the Licensed Territory. The Company retains all rights to ARR-002 outside the Licensed Territory, including all development and commercialization rights. Under the Allist License Agreement, the Company may be entitled to receive payments totaling as much as $ 80.6 million, comprised of a one-time upfront payment and additional payments upon achievement of certain defined development, regulatory, and sales milestones, as well as tiered royalties in mid-single digit to low-double digit percentages on annual net sales of licensed products in the Licensed Territory. ​ ​ ​ ​ ​ 21 Table of Contents