Mirum Pharmaceuticals, Inc. 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our unaudited condensed consolidated financial statements and the related notes and other financial information included elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements and notes thereto and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K (“Annual Report”) for the year ended December 31, 2025, which was filed with the Securities and Exchange Commission (“SEC”) on February 25, 2026. Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to the “Company,” “Mirum,” “we,” “us” and “our” refer to Mirum Pharmaceuticals, Inc. and its consolidated subsidiaries. Forward-Looking Statements In addition to historical financial information, this discussion and analysis contains forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in the section titled “Risk Factors” under Part II, Item 1A below. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potentially,” “predict,” “should,” “will” or the negative of these terms or other similar expressions. In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements . Overview We are a biopharmaceutical company dedicated to transforming the treatment of rare diseases. We have three approved medicines: LIVMARLI® (maralixibat) (“Livmarli”), CHOLBAM® (cholic acid) capsules (“Cholbam”), and CTEXLI® (chenodiol) tablets (“Ctexli”). Livmarli is a novel, orally administered, minimally-absorbed ileal bile acid transporter (“IBAT”) inhibitor (“IBATi”) that is approved for the treatment of cholestatic pruritus in patients with Alagille syndrome (“ALGS”) in the United States (“U.S.”), the European Union (“EU”) and various other countries around the world and for cholestatic pruritus in patients with progressive familial intrahepatic cholestasis (“PFIC”) in the U.S., Canada and Japan and for the treatment of PFIC in the EU. We market and commercialize Livmarli in the U.S., Canada and certain countries in Europe through our specialized and focused commercial team. We have also entered into license and distribution agreements with several rare disease companies for the commercialization of Livmarli in additional countries. In March 2025, our partner Takeda received approval from the Japanese Ministry of Health, Labour, and Welfare for Livmarli for the treatment of cholestatic pruritus in patients with ALGS and PFIC. We market and commercialize Ctexli and Cholbam (also known as Kolbam) (and together with chenodiol, the “Bile Acid Medicines”) in the U.S. directly and indirectly in certain foreign markets. The U.S. Food and Drug Administration (the “FDA”) approved Cholbam in March 2015, as the first FDA-approved treatment for pediatric and adult patients with bile acid synthesis disorders due to single enzyme defects, and for adjunctive treatment of patients with peroxisomal disorders, including peroxisome biogenesis disorder-Zellweger spectrum disorder (“PBD-ZSD”). Ctexli received FDA approval for the treatment of adults with cerebrotendinous xanthomatosis (“CTX”) in February 2025. We are advancing our product candidate, volixibat, a novel, oral, minimally-absorbed agent designed to inhibit IBAT, for the treatment of adult patients with cholestatic liver diseases. We are developing volixibat in the setting of primary sclerosing cholangitis (“PSC”) and primary biliary cholangitis (“PBC”), and in October 2024, we announced that the FDA granted Breakthrough Therapy designation for volixibat as a potential treatment for cholestatic pruritus in patients with PBC. We announced topline results for the VISTAS Phase 2b clinical trial in PSC in May 2026. Based on these topline results, we expect to submit a New Drug Application (“NDA”) to the FDA for volixibat for the treatment cholestatic pruritus in PSC in the second half of 2026, with both potential approval and subsequent launch of volixibat for the treatment of cholestatic pruritus in PSC, if approved, to occur in the first half of 2027. We reported interim data from our VANTAGE Phase 2b clinical trial in PBC in June 2024 and expect the clinical trial to complete enrollment in the second half of 2026 with topline data expected in the first quarter of 2027. 26 Table of Contents In addition, we are developing Livmarli for certain rare cholestatic conditions through the Phase 3 EXPAND study, which we initiated in the fourth quarter of 2024. We completed enrollment of the EXPAND study in the first half of 2026 with topline data expected in the fourth quarter of 2026. In October 2024, we completed a license agreement with Enthorin Therapeutics, LLC and Dart Neuroscience LLC granting us the worldwide right to develop and commercialize MRM-3379, an allosteric inhibitor of Phosphodiesterase 4D (“PDE4D”). We are currently enrolling patients in the BLOOM Phase 2 clinical study of MRM-3379 in Fragile-X Syndrome (“FXS”) and expect topline data in 2027. On January 23, 2026, we completed the acquisition (the “Bluejay Acquisition”) of Bluejay Therapeutics, Inc. (“Bluejay”) and its lead product candidate brelovitug (BJT-778). We are advancing brelovitug for the treatment of chronic hepatitis D virus (“HDV”) infection. Brelovitug is a fully human IgG1 monoclonal antibody that binds the hepatitis B surface antigen, thereby clearing virions and subviral particles and preventing HDV infection and replication. Brelovitug has been granted FDA Breakthrough Therapy designation, EMA Priority Medicines (“PRIME”) scheme designation and European Commission orphan medicinal product designation. Brelovitug is currently being evaluated in the global AZURE clinical program with topline results from the AZURE-1 and AZURE-4 registration-enabling clinical trials expected in the second half of 2026 and top-line results from the AZURE-2 and AZURE-3 registration-enabling clinical trials expected by the first half of 2028. We believe that the results from the AZURE-1 and AZURE-4 trials may support a potential biologics license application (“BLA”) submission to the FDA for brelovitug in HDV in the first half of 2027 followed by a potential approval and subsequent commercial launch, if approved, in the second half of 2027 in the U.S. In April 2026, we entered into an agreement with Incyte Corporation (“Incyte”) whereby we obtained the right to commercialize zilurgisertib upon FDA approval. Zilurgisertib is an oral small molecule ALK2 inhibitor in development for the treatment of fibrodysplasia ossificans progressiva. The FDA has accepted for review Incyte’s NDA with a PDUFA date of September 26, 2026. To date, we have focused primarily on acquiring and in-licensing our product candidates, organizing and staffing our company, business planning, raising capital, advancing our product candidates through clinical development, preparing for commercialization of our product candidates, commercializing our approved medicines, and conducting business development activities relating to, among other things, portfolio expansion through collaborations and acquisitions. Financial Overview Our net loss was $790.2 million and $14.7 million for the three months ended March 31, 2026 and 2025, respectively. As of March 31, 2026, we had an accumulated deficit of $1.5 billion, compared to $667.5 million as of December 31, 2025. As of March 31, 2026, we had unrestricted cash, cash equivalents and investments of $420.6 million, compared to unrestricted cash, cash equivalents and investments of $391.4 million as of December 31, 2025. We anticipate we will continue to generate net losses for the foreseeable future as we continue commercial activities for our approved medicines, conduct our ongoing and planned clinical trials, including the clinical trials for brelovitug, seek regulatory approvals for our product candidates and make potential milestone payments to the licensors and other third parties from whom we have in-licensed or acquired our product candidates. We expect that total product sales of our approved medicines will continue to increase on an annual basis; however, due to large periodic orders from Takeda and our distributors, our product revenue may experience quarterly fluctuations. Additionally, our product revenues from Takeda are based upon variable consideration estimates. If actual results vary from our estimates, we will make adjustments in the period when such variances become known. As a result, our net losses may fluctuate significantly from quarter-to-quarter and year-to-year. We expect to satisfy future cash needs through existing capital balances, revenue from our approved medicines and through a combination of equity offerings, debt financings or other capital sources, collaborations, licenses and other similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. Our failure to raise capital or enter into such other arrangements when needed could have a negative impact on our financial condition and on our ability to pursue our business plans and strategies. If we are unable to raise additional capital when needed, we could be forced to delay, limit, reduce or terminate the development of one or more of our product candidates or future commercialization efforts or grant rights to develop and market our product candidates even if we would otherwise prefer to develop and market such product candidates ourselves. 27 Table of Contents Components of Results of Operations Revenue Product Sales, Net We have three approved medicines: Livmarli, Cholbam and Ctexli. We expect total product sales of our approved medicines will continue to increase on an annual basis. Our U.S. revenue from product sales, net further depends on our prescription mix of commercial payors, Medicaid and amounts of free medicines provided under our patient assistance program. We expect our prescription mix and resulting gross to net adjustment in the U.S. to remain materially consistent. Our revenue from product sales is recognized when the control of the product is transferred. Under our license agreement with Takeda as well as agreements with distributors, we may receive large periodic orders for our products. The timing of these orders can be inconsistent and can create significant quarter-to-quarter variation in product sales. In addition, we recognize our best estimate of the consideration that we expect to receive when control of the inventory is transferred to our licensed partners and distributors. Such estimates may be complex and include estimates as to if and when our distributors and licensed partner’s sales in the market will occur. Estimates are reviewed and updated quarterly as additional information, including in-market pricing and sales information of our authorized distributors and licensed partners, becomes known which may cause variability of quarterly revenue particularly during periods of product launch. Although we expect product revenues to increase as we continue commercial activities for our approved medicines, we may not achieve commercial success. Certain of our approved medicines, including the Bile Acid Medicines, are subject to immediate competition from compounded and generic entrants, as the abbreviated new drug application (“ANDA”) and NDA for these drug products have no remaining or current patent exclusivity. Chenodiol is standard of care for the treatment of CTX in the U.S. and was commercialized with a medical necessity recognition by the FDA until February 2025. We submitted an NDA for chenodiol for the treatment of CTX in 2024 and received FDA approval for the treatment of adults with CTX in February 2025, which is now commercialized under the brand name Ctexli. The FDA has granted orphan exclusivity for chenodiol for the treatment of CTX. Operating Expenses Cost of Sales Cost of sales consist of raw materials, third-party manufacturing costs, personnel, facility and other costs of manufacturing commercial products, transportation and freight, amortization of finite-lived intangible assets and royalty payments payable on net sales of our approved medicines under licensing agreements. Cost of sales may also include period costs related to certain manufacturing services and charges for inventory valuation reserves. In addition, we have firm commitments for the purchase of minimum order quantities for active pharmaceutical ingredients (“APIs”). We periodically evaluate these firm commitments to determine if these commitments are in excess of our needs. If any net loss is determined, we record a charge to cost of sales in the period identified. For our current approved products, we expect cost of sales to increase in the future mainly due to variable costs associated with increased product sales such as royalties payable and inventory costs. We expect cost of sales to remain approximately unchanged as a percent of product sales in the future. Research and Development Expenses Research and development expenses primarily relate to clinical development and manufacturing activities of our product candidates. Our research and development expenses include, among other things: • salaries and related expenses for employee personnel, including benefits, travel and expenses related to stock-based compensation granted to personnel in development functions; • external expenses paid to clinical trial sites, contract research organizations (“CROs”) and consultants that conduct our clinical trials; • expenses related to drug formulation development and the production of clinical trial supplies, including fees paid to contract manufacturers; • licensing milestone payments related to development or regulatory events; • expenses related to non-clinical studies; • expenses related to compliance with drug development regulatory requirements; and 28 Table of Contents • other allocated expenses, which include direct and allocated expenses for rent and maintenance of facilities, depreciation of equipment, and other supplies. We expense research and development costs as incurred. Nonrefundable advance payments for goods or services to be received in the future for use in research and development activities are recorded as prepaid expenses. The prepaid amounts are expensed as the related goods are delivered or the services are performed. Upfront payments, research and development funding and milestone payments made to third parties in connection with licenses and research and development collaborations are expensed as incurred. For the three months ended March 31, 2026, we recorded a one-time stock-based compensation expense within research and development expense of $ 15.4 million related to unvested Bluejay employee stock awards which were accelerated in contemplation of the Bluejay Acquisition. We expect our research and development expense will increase significantly in the future, excluding the one-time stock-based compensation expense in connection with the Bluejay Acquisition discussed above, as we develop brelovitug and continue to develop our volixibat and MRM-3379 product candidates and execute the EXPAND label expansion study for Livmarli. Acquired in-process research and development Acquired in-process research and development expenses are recorded when incurred and reflect costs of externally-developed in-process research and development (“IPR&D”) projects, acquired directly in a transaction other than a business combination, that do not have an alternative future use, including upfront and pre-commercialization milestone payments related to various in-licensing arrangements and the costs of rights to IPR&D projects. Selling, General and Administrative Expense Sales and marketing expense, which is a component of selling, general and administrative expense, primarily consisted of employee-related expenses for our sales group, brand marketing, patient support groups and pre-commercialization expenses related to our product candidates. General and administrative expense, which is a component of selling, general and administrative expense, primarily consists of corporate support and other administrative expenses, including employee-related expenses. For the three months ended March 31, 2026, we recorded a one-time stock-based compensation expense within selling, general and administrative expense of $ 19.3 million related to unvested Bluejay employee stock awards which were accelerated in contemplation of the Bluejay Acquisition. We anticipate that our selling, general and administrative expenses will increase in the future, excluding the one-time stock-based compensation expense in connection with the Bluejay Acquisition discussed above, to support our continued commercialization efforts of our current approved medicines in the U.S. and internationally as well as increased costs of operating as a global commercial stage biopharmaceutical public company. Additionally, if we receive approval for any of our future product candidates, we will incur increased selling, general and administrative expenses to support those commercialization activities. These increases will likely include increased costs related to hiring of additional personnel and fees to outside consultants to support further marketing, legal, tax, planning and accounting activities. Interest Income Interest income consists of interest earned on our cash equivalents and investments. Interest Expense We incur interest expense on our convertible notes. Interest on our convertible notes consists of a 4.00% per annum fixed rate of interest and amortization of debt discount and amortization costs. Critical Accounting Estimates The preparation of financial statements and related disclosures in conformity with U.S. generally accepted accounting principles (“GAAP”) and our discussion and analysis of our financial condition and operating results require our management to make judgments, assumptions and estimates that affect the amounts reported, including the amount of assets, liabilities, expenses and the disclosure of contingent assets and liabilities. Note 2 of the “Notes to Consolidated Financial Statements” in our audited consolidated financial statements included in our Annual Report describes the significant accounting policies and methods used in the preparation of our consolidated financial statements. Management bases its estimates on historical experience, known trends and events, and on various other assumptions it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ materially from these estimates under different assumptions or conditions. 29 Table of Contents There have been no significant changes during the three months ended March 31, 2026, except as described below, in our critical accounting policies and estimates as compared to the critical accounting policies and estimates disclosed in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report. Acquisitions, including Intangible Assets and Contingent Consideration Acquisitions of businesses are accounted for using the acquisition method of accounting. We allocate the purchase price of acquired businesses to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values on the acquisition date. The purchase price allocation process requires management to make significant estimates and assumptions, especially at the acquisition date with respect to intangible assets and acquired IPR&D assets, particularly in the forecasts of future operating results that are used in the discounted cash flow valuation models. Any excess of the purchase price over the estimated fair values of the net assets acquired is recognized as goodwill. Intangible assets are measured at their fair values as of the acquisition date or, in the case of commercial milestone payments, the date they become due. The evaluation of intangible assets includes assessing the amortization period for which the asset is expected to contribute to our future cash flows. Intangible assets with finite useful lives are amortized over their estimated useful lives on a straight-line basis. We test our finite lived intangible assets for impairment annually or if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. If it is determined that the asset is impaired, the carrying value is written down to its estimated fair value, with the related impairment charge recognized in the consolidated statements of operations in the period in which the impairment occurs. In connection with certain acquisitions, we may be required to pay future consideration that is contingent upon the achievement of specified development, regulatory approval or sales-based milestone events. Contingent consideration resulting from a business combination is recorded at its fair value on the acquisition date. Each reporting period thereafter, these obligations are revalued and increases or decreases in their fair value are recorded in the statement of operations until such time that the payment is made. If it is determined that the net assets acquired do not meet the definition of a business combination under the acquisition method of accounting or if substantially all of the fair value of the gross assets acquired is concentrated in a group of similar identifiable assets, the transaction is accounted for as an asset acquisition using the cost accumulation method. In an asset acquisition, no goodwill is recognized and contingent consideration generally is not recognized at the acquisition date. Upfront payments allocated to IPR&D projects at the acquisition date and subsequent pre-commercialization milestone payments are expensed as incurred in the statement of operations unless there is an alternative future use. Recent Accounting Pronouncements A description of recent accounting pronouncements that may potentially impact our financial position, results of operations or cash flows is disclosed in Note 2 to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. 30 Table of Contents Results of Operations for the Three Months Ended March 31, 2026 and 2025 The following table summarizes our results of operations for the three months ended March 31, 2026 and 2025 (in thousands): Three Months Ended March 31, Change 2026 2025 Revenue: Product sales, net $ 159,882 $ 111,585 $ 48,297 Operating expenses: Cost of sales 28,805 23,018 5,787 Research and development 97,910 41,044 56,866 Acquired in-process research and development 726,302 5,000 721,302 Selling, general and administrative 96,330 57,706 38,624 Total operating expenses 949,347 126,768 822,579 Loss from operations (789,465) (15,183) (774,282) Other income (expense): Interest income 3,401 3,023 378 Interest expense (3,616) (3,596) (20) Other income, net — 2,108 (2,108) Net loss before provision for income taxes (789,680) (13,648) (776,032) Provision for income taxes 475 1,029 (554) Net loss $ (790,155) $ (14,677) $ (775,478) Product Sales, Net Product sales, net was $159.9 million for the three months ended March 31, 2026, compared to $111.6 million for the three months ended March 31, 2025. The increase in product sales, net was a result of our continued commercialization of Livmarli in the U.S. for the treatment of ALGS and PFIC, and in certain international markets directly or through distributor and licensed partner orders and from our sales of the Bile Acid Medicines. The following table disaggregates total Product sales, net (in thousands): Three Months Ended March 31, 2026 2025 Change Product sales, net: Livmarli $ 113,804 $ 73,224 $ 40,580 Bile Acid Medicines 46,078 38,361 7,717 Total product sales, net $ 159,882 $ 111,585 $ 48,297 Cost of Sales For the three months ended March 31, 2026, cost of sales was $28.8 million, compared to $23.0 million for the three months ended March 31, 2025. The increase in cost of sales was primarily a result of increases in royalty expenses of $5.1 million on net sales of Livmarli and the Bile Acid Medicines under licensing agreements and $1.8 million of general supply chain support costs. These increases were partially offset by a $2.3 million decrease primarily associated with excess purchase commitments for APIs associated with Ctexli, which were recorded during the three months ended March 31, 2025. 31 Table of Contents Research and Development Expenses The following table summarizes the period-over-period changes in research and development expenses relating to our product candidates in development for the periods indicated (in thousands): Three Months Ended March 31, Change 2026 2025 Product-specific costs: Livmarli $ 3,651 $ 5,242 $ (1,591) Volixibat 17,719 12,106 5,613 MRM-3379 4,913 733 4,180 Brelovitug 20,791 — 20,791 Non product-specific costs: Stock-based compensation 24,189 5,229 18,960 Personnel 18,084 11,385 6,699 Other 8,563 6,349 2,214 Total research and development expenses $ 97,910 $ 41,044 $ 56,866 Research and development expenses were $97.9 million for the three months ended March 31, 2026, an increase of $56.9 million compared to the three months ended March 31, 2025. The increase was primarily due to: • for volixibat programs, an increase of $5.6 million, primarily due to increased expenses associated with conduct of the PSC and PBC trials; • for MRM-3379, an increase of $4.2 million, primarily due to our Phase 2 study in FXS and non clinical studies; • for brelovitug, which we acquired during the three months ended March 31, 2026, an increase of $20.8 million primarily related to expenses associated with expenses for clinical manufacturing and BLA enabling activities and expenses associated with conduct of the AZURE clinical trials; and • for personnel related and stock-based compensation expenses, an aggregate increase of $25.7 million, of which $15.4 million is due to a one-time expense relating to unvested Bluejay employee stock awards which were accelerated in contemplation of the Bluejay Acquisition and $10.3 million due to increased employee headcount and equity award grants to support our development pipeline; partially offset by • for Livmarli, a decrease of $1.6 million, primarily due to lower costs from the PFIC rollover study and other clinical costs partially offset by increased expenses associated with the Livmarli Phase 3 EXPAND label expansion study. Acquired in-process research and development During the three months ended March 31, 2026, we recorded a $726.3 million charge, representing an acquired IPR&D asset with no alternative future use related to the Bluejay Acquisition. In comparison, acquired IPR&D for the three months ended March 31, 2025 includes a development milestone payment associated with our EXPAND study achieved in the three months ended March 31, 2025. Selling, General and Administrative Expenses Selling, general and administrative expenses were $96.3 million for the three months ended March 31, 2026, an increase of $38.6 million compared to the three months ended March 31, 2025. The increase was primarily due to a $19.3 million one-time expense relating to consideration paid to employees of Bluejay for unvested equity awards recognized as post-combination stock-based compensation expense, increases of $8.5 million in personnel and other compensation related expenses, including an increase of $3.4 million in stock-based compensation, reflecting an increase in the number of our selling, marketing and administrative employees to support commercial activities for our approved medicines, $5.1 million sales, marketing and advertising expenses, and $4.5 million of legal, accounting and other outside services. Liquidity and Capital Resources Overview Since inception, we have funded our operations primarily through debt, equity, revenue interest financings and cash from our product sales and license and collaboration revenue. We had $420.6 million of unrestricted cash, cash 32 Table of Contents equivalents and investments as of March 31, 2026, compared to unrestricted cash, cash equivalents and investments of $391.4 million as of December 31, 2025. We have incurred significant operating losses since our inception. As of March 31, 2026, we had an accumulated deficit of $1.5 billion, compared to $667.5 million as of December 31, 2025. In January 2026, immediately following the consummation of the Bluejay Acquisition, we completed the private placement of 3,385,149 shares of our common stock at a price per share of $68.48 and Pre-Funded Warrants to purchase 536,412 Warrant Shares at a price per share of $68.4799 per Pre-Funded Warrant, which equals the purchase price per share of our common stock sold in the first private placement, less $0.0001, the exercise price of each Pre-Funded Warrant, resulting in aggregate net proceeds of approximately $259.9 million after deducting offering expenses payable by us. In August 2025, we filed an automatic shelf registration statement on Form S-3 with the SEC (the “2025 Shelf Registration”), which became effective upon filing, pursuant to which we may register for sale from time to time in one or more offerings an unlimited amount of any combination of our common stock, preferred stock, debt securities and warrants, so long as we continue to satisfy the requirements of a “well-known seasoned issuer” under SEC rules. This automatic shelf registration statement will remain in effect for up to three years from the date it became effective. As of March 31, 2026, we have not issued any securities pursuant to the 2025 Shelf Registration. In November 2023, we entered into a Sales Agreement (the “2023 Sales Agreement”) with Leerink and Cantor Fitzgerald & Co. (the “Sales Agents”), pursuant to which we may, from time to time, sell up to an aggregate amount of $200.0 million of our common stock through the Sales Agents in an “at-the-market” offering. We are not required to sell shares under the 2023 Sales Agreement. Sales of our common stock, if any, under the 2023 Sales Agreement may be made in any transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act. We will pay a given designated Sales Agent a commission of up to 3.0% of the aggregate gross proceeds of any shares of common stock sold through it pursuant to the 2023 Sales Agreement. As of March 31, 2026, we have not issued any securities pursuant to the 2023 Sales Agreement. Based on our current and anticipated level of operations and cash generated from sales of our approved medicines, we believe our existing unrestricted cash, cash equivalents and investments will be sufficient to fund current operations through at least the next 12 months from the filing of this Quarterly Report on Form 10-Q and beyond. We anticipate that we will continue to incur net losses for the foreseeable future as we continue research efforts and the development of our product candidates, including development of brelovitug which we acquired in January 2026, continue commercialization activities for our approved medicines and potentially expand into additional markets, hire additional staff, including clinical, scientific, operational, financial and management personnel and pay potential development milestones. Net loss is also impacted by significant non-cash charges related to stock-based compensation and amortization of intangible assets. Our primary use of cash is to fund operating expenses. Our cash flow from operating activities may experience material fluctuations due to a number of factors, including the timing of inventory builds, accounts receivable collections, receipt and payment of invoices, development or commercial milestone payments as well as the magnitude and timing of cash receipts from our product revenues associated with periodic orders from Takeda and our distributors. Our principal source of liquidity is product revenue from sales of our approved medicines. In recent quarters, liquidity from product revenues has been sufficient to fund current operations. There can be no assurances that future revenues will continue to be sufficient to fund operations. For example, as a result of the Bluejay Acquisition, we expect a significant increase in research and development expenses over the next few years as we continue the clinical development of brelovitug. Should product revenues from our currently approved medicines, our current product candidates or any future product candidates, if approved, be insufficient to fund operations, we would expect to finance our cash needs through a combination of cash on hand, equity offerings, debt financings and potential collaboration, license or development agreements. Our primary cash needs are for day-to-day operations and to fund our working capital requirements. To the extent that we raise additional capital through the sale of equity or convertible debt securities, ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect rights as a stockholder. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may be required to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or to grant licenses on terms that may not be favorable to us. Additionally, if the equity and credit markets deteriorate from adverse geopolitical and macroeconomic developments or otherwise, it may make any necessary debt or equity financing more difficult, more costly and more dilutive. If we are 33 Table of Contents unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate our drug development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves. Material Cash Requirements In addition to ongoing capital needs to fund our ongoing operations, our material cash requirements include the following contractual and other obligations. In April 2023, we completed an offering of $316.3 million aggregate principal of the Notes, which includes the exercise of the initial purchasers’ option in full. The offering resulted in net proceeds of $305.3 million after deducting the initial purchasers’ discounts and commissions and offering expenses. The Notes are our senior, unsecured obligations and accrue interest at a rate of 4.00% per annum, payable semi-annually in arrears on May 1 and November 1 of each year. The Notes will mature on May 1, 2029, unless earlier converted, redeemed or repurchased by us. The terms of these Notes are further described in Note 9 to our unaudited condensed consolidated financial statements. During the first quarter of 2026, the last reported sale price of our common stock exceeded 130% of the conversion price of the Notes for more than 20 trading days during the 30 consecutive trading days ended March 31, 2026. As a result, the Notes are convertible at the option of the holders of the Notes during the second quarter of 2026, the quarter immediately following the quarter when the conditions were met, as stated in the terms of the Notes. If holders of the Notes elect to convert their Notes, we may elect to settle such conversions by paying or delivering, as applicable, cash, shares of our common stock or a combination of cash and shares of our common stock. During the three months ended March 31, 2026 and through the date of this filing, the amount of the principal balance of the Notes that has been converted was not material. In addition, as of March 31, 2026, our material cash requirements for the operations of our business consisted primarily of the current and long-term liabilities noted on our unaudited condensed consolidated balance sheets as well as other commitments, including payments related to our license and acquisition agreements that are contingent upon future events such as our achievement of specified development, regulatory and commercial milestones and we are required to make royalty payments in connection with the sale of products developed under those agreements. The amount and timing of milestone obligations are unknown or uncertain as we are unable to estimate the timing or likelihood of achieving the milestone events. Additionally, the amount of royalty payments are based upon future product sales, which we are unable to predict with certainty. These potential obligations are further described in Note 6 to our unaudited condensed consolidated financial statements. In January 2026, we completed the acquisition of Bluejay. In addition to the consideration paid at closing, we are obligated to pay up to an aggregate of $25.8 million in cash and 522,375 shares of Company common stock, subject to deduction for taxes and certain holdbacks, and up to an aggregate of $200.0 million upon achievement of certain commercial milestones. In April 2026, we entered into an agreement with Incyte whereby we obtained the right to commercialize zilurgisertib upon FDA approval. Zilurgisertib is an oral small molecule ALK2 inhibitor in development for the treatment of fibrodysplasia ossificans progressiva. We paid an upfront payment of $16.0 million. In addition, the Company is obligated to pay royalties in the mid-to-high single digit percentage range and additional regulatory milestones of up to $48.0 million and commercial milestones of up to $15.0 million. We additionally have contractual obligations for our operating leases for our corporate headquarters. These obligations are further described in Note 8 to our unaudited condensed consolidated financial statements. We enter into contracts in the normal course of business with clinical research organizations and clinical sites for the conduct of clinical trials, non-clinical research studies, professional consultants for expert advice and other vendors for clinical supply manufacturing or other services. These contracts generally provide for termination on notice, and therefore are cancellable contracts. We enter into commercial inventory supply agreements that obligate us to firm commitments for the purchase of minimum order quantities, which may be material to our financial statements. 34 Table of Contents Cash Flows The following table provides a summary of the net cash flow activity for the periods indicated (in thousands): Three Months Ended March 31, 2026 2025 Net cash used in operating activities $ (228,763) $ (1,961) Net cash used in investing activities (11,569) (16,134) Net cash provided by financing activities 270,079 6,359 Effect of exchange rate on cash, cash equivalents and restricted cash (1,272) 1,055 Net increase (decrease) in cash, cash equivalents and restricted cash $ 28,475 $ (10,681) Net Cash Used in Operating Activities Net cash used in operating activities was $228.8 million for the three months ended March 31, 2026, reflecting our net loss of $790.2 million partially offset by adjustments of $459.2 million. Adjustments consisted primarily of the fair value of common stock issued as consideration in an asset acquisition, stock-based compensation, depreciation and amortization of our intangible assets and fixed assets. Additionally, cash used in operating activities reflected a cash inflow for changes in net operating assets and liabilities of $102.2 million, primarily related to an increase in holdback liabilities payable in connection with our acquisition of Bluejay, an increase in accounts payable, accrued clinical trial and contract manufacturing costs with the addition of brelovitug to our development pipeline and an increase of sales deductions due to the growth from our product sales. This net inflow from change in operating liabilities was partially offset by an increase in accounts receivable related to the growth in our product sales and an increase in prepaid and other current assets related to assets acquired in the Bluejay acquisition. Net cash used in operating activities was $2.0 million for the three months ended March 31, 2025, reflecting our net loss of $14.7 million partially offset by adjustments of $24.0 million. Adjustments consisted primarily of stock-based compensation, depreciation and amortization of our intangible assets and fixed assets, and charges associated with excess and obsolete inventory and firm commitment losses. Additionally, cash used in operating activities reflected changes in net operating assets of $11.3 million, primarily related to the increase in accounts payable, accrued expenses and other liabilities resulting primarily from an increase in accrued sales deductions and royalties due to the growth from our product sales in the three months ended March 31, 2025, and an increase in accrued expenses related to clinical studies and contract manufacturing activities driven by our growth, offset by payments made for the purchase of inventory. Net Cash Used in Investing Activities Net cash used in investing activities was $11.6 million for the three months ended March 31, 2026, primarily due to purchases of investments and the payment of a commercial milestone achieved in 2025, partially offset by proceeds from maturities of investments. Net cash used in investing activities for the three months ended March 31, 2025 was $16.1 million primarily due to purchases of investments, offset by proceeds from maturities of investments. Net Cash Provided by Financing Activities Net cash provided by financing activities was $270.1 million for the three months ended March 31, 2026, due to proceeds from issuance of common stock and pre-funded warrants in a private placement and proceeds from employee equity award exercises. Net cash provided by financing activities was $6.4 million for the three months ended March 31, 2025, due to proceeds from employee equity award exercises.