ZEVRA THERAPEUTICS, INC. 10-Q

ITEM 1. FINANCIAL STATEMENTS ZEVRA THERAPEUTICS, INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and par value amounts) March 31, 2026 December 31, 2025 Assets Current assets: Cash and cash equivalents $ 95,595 $ 62,406 Investments, current 105,021 128,605 Accounts and other receivables 22,098 23,258 Prepaid expenses and other current assets 4,944 6,998 Inventories, current 2,310 1,740 Total current assets 229,968 223,007 Investments, noncurrent 36,145 47,879 Inventories, noncurrent — 879 Property and equipment, net 430 489 Operating lease right-of-use assets 1,087 1,212 Goodwill 4,701 4,701 Intangible assets, net 6,105 6,421 Other long-term assets 143 143 Total assets $ 278,579 $ 284,731 Liabilities and stockholders' equity Current liabilities: Accounts payable and accrued expenses $ 11,688 $ 11,598 Current portion of operating lease liabilities 406 419 Current portion of discount and rebate liabilities 13,172 12,188 Current portion of income tax payable 20,354 13,710 Other current liabilities 1,408 1,362 Total current liabilities 47,028 39,277 Long-term debt — 61,928 Warrant liability 6,797 9,575 Income tax payable 6,871 7,029 Operating lease liabilities, less current portion 741 859 Discount and rebate liabilities, less current portion 9,479 9,693 Other long-term liabilities 1,859 1,713 Total liabilities 72,775 130,074 Commitments and contingencies (Note M) Stockholders’ equity: Preferred stock: Undesignated preferred stock, $ 0.0001 par value, 10,000,000 shares authorized, no shares issued or outstanding as of March 31, 2026, or December 31, 2025 — — Common stock, $ 0.0001 par value, 250,000,000 shares authorized; 60,690,542 shares issued and 59,114,850 shares outstanding as of March 31, 2026; 58,338,319 shares issued and 56,854,781 shares outstanding as of December 31, 2025 6 6 Additional paid-in capital 602,748 588,458 Treasury stock, at cost ( 10,983 ) ( 10,983 ) Accumulated deficit ( 384,170 ) ( 422,060 ) Accumulated other comprehensive loss ( 1,797 ) ( 764 ) Total stockholders' equity 205,804 154,657 Total liabilities and stockholders' equity $ 278,579 $ 284,731 See accompanying notes to unaudited condensed consolidated financial statements. 4 Table of Contents ZEVRA THERAPEUTICS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except share and per share amounts) Three months ended March 31, 2026 2025 Revenue, net $ 36,220 $ 20,401 Cost of product revenue (excluding $ 316 and $ 1,615 in intangible asset amortization for the three months ended March 31, 2026, and 2025, respectively, shown separately below) 1,897 1,345 Intangible asset amortization 316 1,615 Gain on sale of future royalties, intellectual property, and other assets, net 43,314 — Operating expenses: Research and development 4,392 3,258 Selling, general and administrative 20,783 19,545 Total operating expenses 25,175 22,803 Income (loss) from operations 52,146 ( 5,362 ) Other (expense) income: Loss on extinguishment of debt ( 2,756 ) — Loss on derivative liability ( 7,216 ) — Interest expense ( 1,711 ) ( 1,969 ) Fair value adjustment related to warrant and CVR liability 968 4,874 Fair value adjustment related to investments ( 216 ) ( 3 ) Interest and other income, net 3,589 543 Total other (expense) income ( 7,342 ) 3,445 Income (loss) before income taxes 44,804 ( 1,917 ) Income tax expense ( 6,914 ) ( 1,182 ) Net income (loss) $ 37,890 $ ( 3,099 ) Net income (loss) per share of common stock: Basic $ 0.62 $ ( 0.06 ) Diluted $ 0.60 $ ( 0.06 ) Weighted-average shares of common stock outstanding: Basic 58,405,955 54,095,543 Diluted 60,230,490 54,095,543 See accompanying notes to unaudited condensed consolidated financial statements. 5 Table of Contents ZEVRA THERAPEUTICS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (in thousands) Three months ended March 31, 2026 2025 Net income (loss) $ 37,890 $ ( 3,099 ) Other comprehensive loss: Foreign currency translation adjustment ( 982 ) ( 713 ) Net unrealized losses on available-for-sale securities ( 51 ) — Other comprehensive loss ( 1,033 ) ( 713 ) Comprehensive income (loss) $ 36,857 $ ( 3,812 ) See accompanying notes to unaudited condensed consolidated financial statements. 6 Table of Contents ZEVRA THERAPEUTICS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (in thousands) Additional Treasury Other Total Common Paid-in Stock, Accumulated Comprehensive Stockholders' Stock Capital at cost Deficit Income (Loss) Equity Balance as of January 1, 2026 $ 6 $ 588,458 $ ( 10,983 ) $ ( 422,060 ) $ ( 764 ) $ 154,657 Net income — — — 37,890 — 37,890 Stock-based compensation expense — 3,105 — — — 3,105 Issuance of common stock for stock awards — 25 — — — 25 Issuance of common stock for stock warrants exercised — 11,160 — — — 11,160 Other comprehensive loss — — — — ( 1,033 ) ( 1,033 ) Balance as of March 31, 2026 $ 6 $ 602,748 $ ( 10,983 ) $ ( 384,170 ) $ ( 1,797 ) $ 205,804 See accompanying notes to unaudited condensed consolidated financial statements. 7 Table of Contents ZEVRA THERAPEUTICS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY, CONTINUED (in thousands) Additional Treasury Other Total Common Paid-in Stock, Accumulated Comprehensive Stockholders' Stock Capital at cost Deficit Income (Loss) Equity Balance as of January 1, 2025 $ 5 $ 555,302 $ ( 10,983 ) $ ( 505,289 ) $ 631 $ 39,666 Net loss — — — ( 3,099 ) — ( 3,099 ) Stock-based compensation expense — 3,052 — — — 3,052 Issuance of common stock in exchange for consulting services — 75 — — — 75 Issuance of common stock as part of the Employee Stock Purchase Plan — 63 63 Issuance of common stock for options exercised — 1,979 — — — 1,979 Other comprehensive loss — — — — ( 713 ) ( 713 ) Balance as of March 31, 2025 $ 5 $ 560,471 $ ( 10,983 ) $ ( 508,388 ) $ ( 82 ) $ 41,023 See accompanying notes to unaudited condensed consolidated financial statements. 8 Table of Contents ZEVRA THERAPEUTICS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Three months ended March 31, 2026 2025 Cash flows from operating activities: Net income (loss) $ 37,890 $ ( 3,099 ) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Stock-based compensation expense 3,105 3,115 Inventory obsolescence charge 485 — Income tax expense 6,914 1,182 Depreciation and amortization expense 368 1,649 Non-cash interest expense 341 663 Non-cash lease expense 118 — Fair value adjustment related to warrant and CVR liability ( 968 ) ( 4,874 ) Accretion on investments ( 624 ) ( 305 ) Fair value adjustment related to investments 216 3 Loss on extinguishment of debt 2,756 — Loss on derivative liability 7,216 — Cash paid to settle derivative instrument and payoff premium ( 9,016 ) — Settlement of royalties to Aquestive ( 4,393 ) — Paid-in-kind interest ( 3,134 ) — Gain on sale of future royalties, intellectual property, and other assets, net ( 43,314 ) — Consulting fees paid in common stock — 75 (Gain) loss on foreign currency exchange rates ( 1,403 ) 213 Change in assets and liabilities: Accounts and other receivables 6,890 ( 2,108 ) Prepaid expenses and other current assets 2,053 286 Inventories ( 185 ) ( 205 ) Operating lease right-of-use assets — 166 Other long-term assets ( 87 ) — Accounts payable and accrued expenses ( 529 ) ( 7,265 ) Discount and rebate liabilities 1,150 1,912 Operating lease liabilities ( 123 ) ( 190 ) Other liabilities 416 560 Net cash provided by (used in) operating activities 6,142 ( 8,222 ) Cash flows from investing activities: Sale of future royalties, intellectual property, and other assets, net 43,935 — Purchases of property and equipment ( 35 ) ( 99 ) Disposals of property and equipment 42 — Purchases of investments ( 58,296 ) ( 7,359 ) Sales and maturities of investments 93,972 18,000 Net cash provided by investing activities 79,618 10,542 Cash flows from financing activities: Repayment of debt ( 60,092 ) — Payments for employee taxes related to stock awards ( 2,635 ) Proceeds from issuance of common stock for options exercised 752 1,979 Proceeds from issuance of common stock for warrants exercised 9,171 — Payments of principal on insurance financing arrangements — ( 372 ) Net cash (used in) provided by financing activities ( 52,804 ) 1,607 Effect of exchange rate changes on cash and cash equivalents 233 ( 372 ) Net increase in cash and cash equivalents 33,189 3,555 Cash and cash equivalents, beginning of period 62,406 33,785 Cash and cash equivalents, end of period $ 95,595 $ 37,340 Supplemental cash flow information: Cash paid for interest $ 1,370 $ 1,306 Right-of-use assets obtained in exchange for lease liabilities — 1,115 Non-cash investing activities: Cash not yet received on sale of of future royalties, intellectual property, and other assets, net 5,000 — See accompanying notes to unaudited condensed consolidated financial statements. 9 Table of Contents ZEVRA THERAPEUTICS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS A. Description of Business, Basis of Presentation, and Significant Transactions Organization Zevra Therapeutics, Inc. (the “Company” or “Zevra”) is a commercial-stage company with a late-stage pipeline committed to bringing life-changing therapeutics to people living with rare diseases. The Company is focused on expanding patient access through geographic expansion opportunities, progressing and increasing its pipeline, and delivering meaningful therapeutics. On September 20, 2024, the U.S. Food and Drug Administration (“FDA”) approved the New Drug Application (“NDA”) for MIPLYFFA ® (arimoclomol), an orally-delivered treatment for Niemann-Pick disease type C (“NPC”), which is an ultra-rare and progressive neurodegenerative disease. MIPLYFFA, the first FDA-approved treatment for NPC, is indicated for use in combination with miglustat for the treatment of neurological manifestations of NPC in adult and pediatric patients two years of age and older. The Company's other commercial stage asset, OLPRUVA ® (sodium phenylbutyrate) for oral suspension, is approved by the FDA for the treatment of certain urea cycle disorders (“UCDs”). Arimoclomol has been granted orphan medicinal product designation for the treatment of NPC by the European Commission. The Company is pursuing regulatory approval in E.U. and filed a Marketing Authorization Application (“MAA”) with the European Medicines Agency (“EMA”) in July 2025; the application is currently under review. Additionally, the Company is currently conducting a Phase 3 clinical trial of celiprolol for the treatment of Vascular Ehlers-Danlos syndrome (“VEDS”) in patients with a confirmed type III collagen mutation. On March 13, 2026, the Company entered into an Asset Purchase and Settlement Agreement (the “Commave Settlement Agreement”) with Commave Therapeutics SA (“Commave”) to sell certain assets of the Company to Commave and to resolve pending litigation (Note M) related to claims arising under the Collaboration and License Agreement between the parties dated September 3, 2019, as amended (the “AZSTARYS License Agreement”). Pursuant to the Commave Settlement Agreement, Commave agreed to pay a total of $ 50.0 million, and the Company agreed to sell to Commave all of the Company's rights to certain assets relating to the Company's serdexmethylphenidate (“SDX”) portfolio, including AZSTARYS and KP1077. Under the March 2012 termination agreement with Aquestive Therapeutics, Inc. (“Aquestive”) (the “Aquestive Termination Agreement”), Aquestive has the right to receive an amount equal to 10 % of any value generated by AZSTARYS and any product candidates containing SDX, including the sales proceeds under the Commave Settlement Agreement. Commave paid an aggregate of $ 45.0 million during the first quarter of 2026, consisting of $ 40.5 million paid to the Company and $ 4.5 million paid directly to Aquestive. In April 2026, Commave paid the remaining $ 5.0 million, consisting of $ 4.5 million to the Company and $ 0.5 million directly to Aquestive. In accordance with ASC 610-20, Gains and Losses from the Derecognition of Nonfinancial Assets , the net proceeds from the sale were recorded as a gain on sale of future royalties, intellectual property, and other assets, net of $ 43.3 million in the Company's unaudited condensed consolidated statements of operations for the three months ended March 31, 2026. In addition, under the Commave Settlement Agreement, the Company and Commave have agreed to terminate the AZSTARYS License Agreement in its entirety. Basis of Presentation The Company prepared the unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) and, in the Company’s opinion, reflect all adjustments, including normal recurring items that are necessary. All significant intercompany accounts and transactions have been eliminated in consolidation. Registration Statements on Form S-3 On February 5, 2024, Zevra filed a registration statement on Form S-3 (File No. 333-276856) registering the resale of an aggregate of 2,269,721 shares of Zevra’s common stock by certain stockholders (the “Resale Registration Statement”). The Resale Registration Statement was declared effective on April 8, 2024. On June 4, 2024, the Company filed a registration statement on Form S-3 (File No. 333-279941) (the “June 2024 Registration Statement”) under which the Company may sell securities, including as may be issuable upon conversion, redemption, repurchase, exchange or exercise of securities, in one or more offerings up to a total aggregate offering price of $ 350.0 million, $ 75.0 million of 10 Table of Contents which was allocated to the sale of the shares of common stock issuable under the 2024 ATM Agreement (as described further below). The June 2024 Registration Statement was declared effective on June 13, 2024. Entry into 2024 ATM Agreement On July 12, 2024, the Company entered into an equity distribution agreement (the “2024 ATM Agreement”) with Citizens JMP Securities LLC (“Citizens JMP”) under which the Company may offer and sell, from time to time at its sole discretion, shares of its common stock having an aggregate offering price of up to $ 75.0 million through Citizens JMP as its sales agent. The issuance and sale, if any, of common stock by the Company under the 2024 ATM Agreement will be made pursuant to the June 2024 Registration Statement, the accompanying prospectus, and the related prospectus supplement dated July 12, 2024. Citizens JMP may sell the 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. Citizens JMP will use commercially reasonable efforts to sell the common stock from time to time, based upon instructions from the Company (including any price, time or size limits or other customary parameters or conditions the Company may impose). The Company will pay Citizens JMP a commission equal to 3.0 % in the aggregate of the gross sales proceeds of any common stock sold through Citizens JMP under the 2024 ATM Agreement. As of March 31, 2026 , no sha res have been issued or sold under the 2024 ATM Agreement. Reclassifications Certain reclassifications were made to historical period's unaudited condensed consolidated financial statements to conform to the classifications used in the current year. These reclassifications had no impact on the consolidated net income (loss), changes in stockholder's equity, or cash flows previously reported. B. Summary of Significant Accounting Policies Use of Estimates The preparation of these unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. On an ongoing basis, the Company evaluates its estimates and assumptions, including those related to revenue recognition, the useful lives of property and equipment, the recoverability of long-lived assets, the incremental borrowing rate for leases, and assumptions used for purposes of determining stock-based compensation, income taxes, the fair value of the warrant liability and discount and rebate liabilities, the valuation of embedded derivatives, and the net realizable value of inventory, among others. The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable, the results of which form the basis for making judgments about the carrying value of assets and liabilities. Concentration of Credit Risk Financial instruments that potentially expose the Company to concentrations of credit risk consist principally of cash on deposit and investments with multiple financial institutions, the balances of which frequently exceed insured limits, and accounts receivable, which are concentrated amongst a limited number of customers. Investments The Company maintains investment securities that are classified as available-for-sale securities, primarily consisting of U.S. Treasury securities and corporate bonds. In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 825, Financial Instruments, the Company has historically elected the fair value option based on the Company's liquidity needs. For purchases of debt securities in previous periods, applying fair value accounting most accurately represented the Company's investment strategy due to the fact that excess cash was being invested for the purpose of funding future operations. In such circumstances, securities are carried at fair value with unrealized gains and losses included in fair value adjustment related to investments on the unaudited condensed consolidated statements of operations. As of March 31, 2026, and December 31, 2025, the Company held securities under the fair value option with an aggregate fair value of $ 82.6 million and $ 176.5 million, respectively, that contained an aggregate unrealized loss of less than $( 0.1 ) million and an aggregate unrealized gain of $ 0.1 million, respectively, which is included on the unaudited condensed consolidated statements of operations. The Company did not elect to apply the fair value option to individual securities purchased in 2026 due to its strengthening financial position and decreased need for immediate liquidity. For such securities, unrealized gains and losses are included in net unrealized gains (losses) on available-for-sale securities on the unaudited condensed consolidated statements of comprehensive income (loss). 11 Table of Contents Interest income is recognized as earned using an effective yield method giving effect to the amortization of premium and accretion of discount and is based on the economic life of the securities. Interest income is included in interest and other income, net, in the unaudited condensed consolidated statements of operations. As of March 31, 2026, securities for which the fair value option was not elected had an aggregate fair value and amortized cost basis of $ 58.6 million, with an aggregate unrealized loss of less than $( 0.1 ) million included in the unaudited condensed consolidated statements of comprehensive income (loss). The fair value of these securities, along with those for which the fair value option was elected, are included in the investments, current, and investments, noncurrent, lines on the unaudited condensed consolidated balance sheets. We determined that none of these recently purchased available-for-sale securities were other-than-temporarily impaired as of March 31, 2026. Therefore, we believe that it is more likely than not that the investments will be held until maturity or a forecasted recovery of fair value. For securities held at March 31, 2026, approximately $ 105.0 million mature within one year and approximately $ 36.1 million mature in one to three years. Variable Interest Entities The primary beneficiary of a variable interest entity (“VIE”) is required to consolidate the assets and liabilities of the VIE. When the Company obtains a variable interest in another entity, it assesses at the inception of the relationship and upon occurrence of certain significant events whether the entity is a VIE and, if so, whether the Company is the primary beneficiary of the VIE based on its power to direct the activities of the VIE that most significantly impact the VIE's economic performance and the Company's obligation to absorb losses or the rights to receive benefits from the VIE that could potentially be significant to the VIE. To assess whether the Company has the power to direct the activities of the VIE that most significantly impact the VIE's economic performance, the Company considers all the facts and circumstances, including the Company's role in establishing the VIE and the Company's ongoing rights and responsibilities. The assessment includes identifying the activities that most significantly impact the VIE's economic performance and identifying which party, if any, has the power to direct those activities. In general, the parties that make the most significant decisions affecting the VIE (management and members of the Board of Directors) are deemed to have the power to direct the activities of a VIE. To assess whether the Company has the obligation to absorb losses of the VIE or the rights to receive benefits from the VIE that could potentially be significant to the VIE, the Company considers all of its economic interests that are deemed to be variable interests in the VIE. This assessment requires judgment in determining whether these interests, in the aggregate, are considered potentially significant to the VIE. As of March 31, 2026, and December 31, 2025, the Company identified Acer Therapeutics, Inc. (“Acer”) to be the Company's sole interest in a VIE. As Zevra is the final decision maker for all of Acer's research, development, and commercialization of drug candidates that it is producing, the Company directs the activities of Acer that most significantly impact its performance. Therefore, the Company is the primary beneficiary of this VIE for accounting purposes and consolidates the assets and liabilities of the VIE. Gain on Sale of PRV The Company received a transferable rare pediatric disease priority review voucher (“PRV”) in conjunction with the FDA approval of MIPLYFFA. On February 26, 2025, the Company and its subsidiary, Zevra Denmark A/S, entered into an asset purchase agreement with a buyer, pursuant to which the Company agreed to sell the PRV to the buyer for aggregate proceeds of $ 150.0 million, payable in cash, upon the closing of the sale. On April 1, 2025, the asset sale was consummated and title of the PRV transferred to the buyer, resulting in net proceeds of $ 148.3 million to the Company. The PRV did not have a carrying value at the time of sale. In accordance with ASC 610-20, Gains and Losses from the Derecognition of Nonfinancial Assets, the net proceeds from the sale were recorded as a gain on sale of PRV in the Company's unaudited condensed consolidated statements of operations in the three months ended June 30, 2025. Revenue Recognition The Company recognizes revenue in accordance with the provisions of ASC 606, Revenue from Contracts with Customers (“ASC 606”) and, as a result, follows the five-step model when recognizing revenue: 1) identifying a contract; 2) identifying the performance obligations; 3) determining the transaction price; 4) allocating the price to the performance obligations; and 5) recognizing revenue when the performance obligations have been fulfilled. 12 Table of Contents Product Revenues, net Net revenues from product sales are recognized at the transaction price when the customer obtains control of the Company's product, which occurs at a point in time, typically upon receipt of the product by the customer. The Company's current single customer for product sales of MIPLYFFA and OLPRUVA is a specialty pharmacy provider. In accordance with ASC 606, the Company recognizes revenue when fulfilling its performance obligation by transferring control of promised goods or services to its customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. In determining when the customer obtains control of the product, the Company considers certain indicators, including whether the Company has a present right to payment from the customer, whether title and/or significant risks and rewards of ownership have transferred to the customer and whether customer acceptance has been received. The Company's net revenues represent total revenues adjusted for discounts and allowances, including estimated cash discounts, chargebacks, rebates, returns, copay assistance, data fees and wholesaler fees for services. These adjustments represent variable consideration under ASC 606 and are recorded as a reduction of revenue. These adjustments are established by management as its best estimate based on available information and will be adjusted to reflect known changes in the factors that impact such allowances. Adjustments for variable consideration are determined based on the contractual terms with customers, historical trends, communications with customers and the levels of inventory remaining in the distribution channel, as well as expectations about the market for the product and anticipated introduction of competitive products. All estimated reserve liabilities related to commercial products are recorded within the current portion of discount and rebate liabilities in the unaudited condensed consolidated balance sheets. Expanded Access Program Net revenue includes revenue from the sale of arimoclomol provided for the treatment of NPC under an expanded access program (“EAP”) in France, and in select territories outside Europe. An EAP is a program giving specific patients access to a drug that is not yet approved for commercial sale. Only drugs targeting serious or rare indications and for which there is currently no appropriate treatment are considered for expanded access programs. Further, to be considered for the expanded access program, the drug must have proven efficacy and safety and must either be undergoing price negotiations or seeking marketing approval. In accordance with ASC 606, the Company recognizes revenue when fulfilling its performance obligation under the global EAP by transferring control of promised goods or services to its customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. In determining when the customer obtains control of the product, the Company considers certain indicators, including whether the Company has a present right to payment from the customer, whether title and/or significant risks and rewards of ownership have transferred to the customer and whether customer acceptance has been received. Revenue is recognized net of sales deductions, including discounts, rebates, applicable distributor fees, and revenue-based taxes. The French Health Authorities and the manufacturer have agreed to a price for reimbursements under the EAP in France, but the final price depends on the terms and conditions negotiated with the French Health Authorities, following market authorization. Any excess in the price charged by the manufacturer compared to the price agreed with the health authorities once the medicinal product is authorized in France must be repaid. The potential repayment is considered in the clawback liability. An estimate of net revenue and clawback liability are recognized using the ‘expected value’ method. Accounting for net revenue and clawback liability requires determination of the most appropriate method for estimating the expected final price. This estimate also requires assumptions with respect to inputs into the method, including current pricing of comparable marketed products within the rare disease area in France. Management has considered the expected final sales price as well as the price of similar medicinal products. The Company is operating within a rare disease therapeutic area where there is unmet treatment need and hence a limited number of comparable commercialized medicinal products. The limited available relevant market information for directly comparable commercialized medicines within rare disease increases the uncertainty in management's estimate. Licensing Agreements The terms of the Company’s licensing agreements typically include one or more of the following: (i) upfront fees; (ii) milestone payments related to the achievement of development, regulatory, or commercial goals; and (iii) royalties on net sales of licensed products. Each of these payments may result in licensing revenues. As part of the accounting for these agreements, the Company must develop estimates and assumptions that require judgment to determine the underlying stand-alone selling price for each performance obligation, which determines how the transaction price is allocated among the performance obligations. Generally, the estimation of the stand-alone selling price may include such estimates as independent evidence of market price, forecasted revenues or costs, development timelines, discount rates, and probability of regulatory success. The Company evaluates each performance obligation to determine if it can be satisfied at a point in time or over time, and it measures the services delivered to the licensee, which are periodically reviewed based on the progress of the related 13 Table of Contents program. The effect of any change made to an estimated input component and, therefore, revenue or expense recognized, would be recorded as a change in estimate. In addition, variable consideration (e.g., milestone payments) must be evaluated to determine if it is constrained and, therefore, excluded from the transaction price. Upfront Fees : If a license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenues from the transaction price allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time. Milestone Payments : At the inception of each arrangement that includes milestone payments (variable consideration), the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company’s or the licensee’s control, such as non-operational developmental and regulatory approvals, are generally not considered probable of being achieved until those approvals are received. At the end of each reporting period, the Company re-evaluates the probability of achievement of milestones that are within its or the licensee’s control, such as operational developmental milestones and any related constraint, and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect collaboration revenues and earnings in the period of adjustment. Revisions to the Company’s estimate of the transaction price may also result in negative licensing revenues and earnings in the period of adjustment. Acquired IPR&D and Milestones Expenses In an asset acquisition, payments incurred prior to regulatory approval to acquire rights to in-process research and development (“IPR&D”) projects are expensed as acquired IPR&D and milestones expense in the unaudited condensed consolidated statements of operations unless the project has an alternative future use. These costs include upfront and development milestone payments related to R&D collaborations, licensing arrangements, or other asset acquisitions that provide rights to develop, manufacture and/or sell pharmaceutical products. Where contingent development milestone payments are due to third parties, prior to regulatory approval, the payment obligations are expensed when the milestone results are achieved. Regulatory and commercial milestone payments made to third parties subsequent to regulatory approval are capitalized as intangible assets and amortized to intangible asset amortization over the remaining useful life of the related product. Embedded Derivative The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative instruments that are bifurcated from a host contract, the Company recognizes them as either assets or liabilities in the unaudited condensed consolidated balance sheets and measures them at fair value. Embedded derivatives are remeasured at each reporting date, with changes in fair value recognized in earnings within loss on derivative liability in the unaudited condensed consolidated statements of operations. The Company initially assesses the probability of triggering events for bifurcated embedded derivatives in determining fair value. The probability is assessed at each reporting period. Inventories The value of inventories is recorded at net realizable value. The Company determines the cost of its inventories, which include amounts related to materials and manufacturing overhead, on a first-in, first-out basis. Inventories that are not expected to be sold within 12 months are classified as inventories, noncurrent. The Company may scale-up and make commercial quantities of its product candidates prior to the date it anticipates that such product will receive final regulatory approval. The scale-up and commercial production of pre-launch inventory involves the risk that such products may not be approved for marketing on a timely basis, or ever. This risk notwithstanding, the Company may scale-up and build pre-launch inventory of products that have not received final regulatory approval when the Company believes such action is appropriate in relation to the commercial value of the product launch opportunity. We capitalize inventory costs associated with our products prior to regulatory approval when, based on management's judgment, future commercialization is considered probable and the future economic benefit is expected to be realized; otherwise, such costs are expensed as research and development. The determination to capitalize inventory costs is based on various factors, including status and expectations of the regulatory approval process, any known safety or efficacy concerns, potential labeling restrictions, and any other impediments to obtaining regulatory approval. The Company ha d no pre-approval inventory on its unaudited condensed consolidated balance sheets as of March 31, 2026, or December 31, 2025. Inventory used in clinical trials is also expensed as research and development expense when selected for such use. Inventory that can be used in the production of either clinical or commercial products is expensed as research and development costs when identified for use in a clinical manufacturing campaign. The cost of finished goods inventory that is shipped to a customer 14 Table of Contents to support the Company’s patient assistance programs is expensed when those shipments take place. As of March 31, 2026, and December 31, 2025, the Com pany di d not have pre-launch inventory that qualified for capitalization. The Company performs an assessment of the recoverability of capitalized inventory during each reporting period and writes down any excess and obsolete inventory to its net realizable value in the period in which the impairment is first identified. Such impairment charges, should they occur, are recorded as a component of cost of product revenue in the unaudited condensed consolidated statements of operations. The determination of whether inventory costs will be realizable requires the use of estimates by management. If actual market conditions are less favorable than projected by management, additional write downs of inventory may be required. Additionally, the Company’s products are subject to strict quality control and monitoring, which is performed throughout the manufacturing process. In the event that certain batches or units of product do not meet quality specifications, the Company will record a charge to cost of product revenue, to write down any unsaleable inventory to its estimated net realizable value. For the three months ended March 31, 2026, the Company recognized $ 0.5 million related to write-downs for unsaleable inventory. There was no write-down for unsaleable inventory for the three months ended March 31, 2025. Cost of Product Revenue The components of cost of product revenue are royalties and expenses directly attributable to revenue. To date, the Company has generated revenue from product sales of MIPLYFFA and OLPRUVA, reimbursements received under the global EAP, royalties or net sales milestone payments generated under the AZSTARYS License Agreement, and consulting agreements. Prior to our acquisition of the assets of Orphazyme A/S (“Orphazyme”) in May 2022, Orphazyme had entered into an asset purchase agreement with LadRx Corporation, which was assigned to XOMA (US) LLC, a wholly-owned subsidiary of XOMA Corporation (“XOMA”), in June 2023 (“XOMA License Agreement”). Under the XOMA License Agreement, XOMA is entitled to a mid-single digit percentage royalty with respect to net sales of MIPLYFFA as well as milestone payments based on future potential sales and regulatory milestones. On August 30, 2023, Acer and Relief Therapeutics SA (“Relief”) entered into an exclusive license agreement (the “Relief License Agreement”). Pursuant to the Relief License Agreement, Zevra is obligated to pay royalties of 10 % of U.S. net sales of OLPRUVA up to a maximum of $ 45.0 million, plus specified regulatory milestones, for total payments to Relief of up to $ 56.5 million. On April 10, 2025, Relief sold the rights to this royalty to Soleus Capital Management L.P. Under the Aquestive Termination Agreement, Aquestive has the right to receive an amount equal to 10 % of any value generated by AZSTARYS and any product candidates containing SDX. Accordingly, in connection with the Commave Settlement Agreement, Aquestive receives 10 % of the Company's sales proceeds. Accounts and Other Receivables Accounts and other receivables consist of receivables from MIPLYFFA and OLPRUVA product sales, receivables under the AZSTARYS License Agreement, receivables related to the Commave Settlement Agreement, the global EAP, and income tax receivables and other receivables due to the Company. Receivables under the AZSTARYS License Agreement are recorded for amounts due to the Company related to royalties on product sales. Receivables under the global EAP are recorded for revenue from arimoclomol in France and select territories outside of Europe. The Company provides reserves against receivables for estimated losses that may result from a customer's inability to pay. Receivables are evaluated to determine if any reserve or allowance should be recorded based on consideration of the current economic environment, expectations of future economic conditions, specific circumstances and the Company’s own historical collection experience. Amounts determined to be uncollectible are charged or written-off against the reserve. Research and Development Major components of research and development costs include cash compensation, stock-based compensation, depreciation and amortization expense on research and development property and equipment, costs of preclinical studies, clinical trials and related clinical manufacturing, costs of drug development, costs of materials and supplies, facilities cost, overhead costs, regulatory and compliance costs, and fees paid to consultants and other entities that conduct certain research and development activities on the Company’s behalf. Costs incurred in research and development are expensed as incurred. The Company records nonrefundable advance payments it makes for future research and development activities as prepaid expenses. Prepaid expenses are recognized as expense in the unaudited condensed consolidated statements of operations as the Company receives the related goods or services. 15 Table of Contents The Company enters into contractual agreements with third-party vendors who provide research and development, manufacturing, and other services in the ordinary course of business. Some of these contracts are subject to milestone-based invoicing and services are completed over an extended period of time. The Company records liabilities under these contractual commitments when an obligation has been incurred. This accrual process involves reviewing open contracts and purchase orders, communicating with the applicable personnel to identify services that have been performed and estimating the level of service performed and the associated cost when the Company has not yet been invoiced or otherwise notified of actual cost. The majority of the service providers invoice the Company monthly in arrears for services performed. The Company makes estimates of the accrued expenses as of each balance sheet date based on the facts and circumstances known. The Company periodically confirms the accuracy of the estimates with the service providers and make adjustments, if necessary. Patent Costs Patent costs, including related legal costs, are expensed as incurred and recorded within general and administrative expenses on the unaudited condensed consolidated statements of operations. Income Taxes The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. Valuation allowances are recorded to reduce deferred tax assets to the amount the Company believes is more likely than not to be realized. The Company is subject to taxation in the United States (including federal, state, and local jurisdictions) and the Kingdom of Denmark. Generally, the Company is subject to examination by tax jurisdictions from 2021 to 2024 tax years as the statute of limitation (excluding net operating loss carryforwards) are 3 to 4 years in the United States and Kingdom of Denmark. Tax liabilities may arise from interpretations and judgments made by the Company with regard to transfer pricing in the application of the relevant statutes, regulations, tax rulings and case law across the various jurisdictions. The Company uses significant judgment in (1) determining whether the technical merits of tax positions taken in the various jurisdictions are more-likely-than-not to be sustained based on applicable tax law and (2) measuring the related amount of tax liability that qualifies for recognition. The United States federal and state tax jurisdictions can audit the net operating loss carryforwards from the tax years in which the statute of limitation has expired but can only adjust the net operating loss carryforwards. No income tax returns are currently under examination by taxing authorities. Uncertain tax positions are recognized only when the Company believes it is more likely than not that the tax position will be upheld on examination by the taxing authorities based on the merits of the position. The Company recognizes interest and penalties, if any, related to unrecognized income tax uncertainties in income tax expense. On December 22, 2017, the U.S. government enacted H.R. 1, “An Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018” (“Tax Act”). Effective January 1, 2018, the Tax Act provides for a new global intangible low-taxed income (“GILTI”) provision. Under the GILTI provision, certain foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets are included in U.S. taxable income. The Company has not recorded any deferred taxes for future GILTI inclusions as any future inclusions are expected to be treated as a period expense. On July 4, 2025, the One Big Beautiful Bill Act (the “OBBB”), which includes a broad range of tax reform provisions, was signed into law in the United States. This includes a net Controlled Foreign Corporation (“CFC”) tested income (“NCTI”) provision, which is an update of the GILTI provision that was effective under H.R. 1. The Company has not recorded any deferred taxes for future NCTI inclusions as any future inclusions are expected to be treated as a period expense. The Company continues to assess the impact of the OBBB but currently does not expect the OBBB to have a material impact on the Company's estimated annual effective tax rate in 2026. Stock-Based Compensation The Company measures and recognizes compensation expense for all stock-based payment awards made to employees, officers and directors based on the estimated fair values of the awards as of the grant date. The Company records the value of the portion of the award that is ultimately expected to vest as expense over the requisite service period. The Company also accounts for equity instruments issued to non-employees using a fair value approach under ASC subtopic 505-50. The Company values equity instruments and stock options granted using the Black-Scholes-Merton (“BSM”) option pricing model. 16 Table of Contents Earnings per Share The Company uses the two-class method to compute net income (loss) per common share because the Company has issued securities, other than common stock, that contractually entitle the holders to participate in dividends and earnings of the Company. The two-class method requires earnings for the period to be allocated between common stock and participating securities based upon their respective rights to receive distributed and undistributed earnings. Holders of each series of the Company’s convertible preferred stock, if applicable, and select warrants are entitled to participate in distributions, when and if declared by the board of directors, that are made to common stockholders and, as a result, are considered participating securities. Segment and Geographic Information Operating segments are defined as components of an enterprise (business activity from which it earns revenue and incurs expenses) for which discrete financial information is available and regularly reviewed by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company’s CODM is its Chief Executive Officer. The Company views its operations and manages its business as a single operating and reporting segment. See Note C for further information. Foreign Currency Assets and liabilities are translated into the reporting currency using the exchange rates in effect on the balance sheet dates. Equity accounts are translated at historical rates, except for the change in retained earnings during the year, which is the result of the income statement translation process. Revenue and expense accounts are translated using the weighted average exchange rate during the period. The cumulative translation adjustments associated with the net assets of foreign subsidiaries are recorded in accumulated other comprehensive income (loss) in the accompanying unaudited condensed consolidated statements of stockholders’ equity. Debt Issuance Costs Debt issuance costs incurred in connection with financing arrangements are recorded as a reduction of the related debt on the unaudited condensed consolidated balance sheets and amortized over the life of the respective financing arrangement using the effective interest method. Warrants The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in FASB ASC Topic 480, Distinguishing Liabilities from Equity (“ASC 480”) and FASB ASC Topic 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company's own stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the issuing company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For warrants that meet all criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital on the unaudited condensed consolidated statements of changes in stockholders’ equity at the time of issuance. For warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and on each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss in other expense, net, on the unaudited condensed consolidated statements of operations. The fair value of the warrants was estimated using the BSM option pricing model. New Accounting Pronouncements Recently Adopted In December 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-09, Income Taxes (“Topic 740”): Improvements to Income Tax Disclosures . ASU 2023-09 establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. Under the new guidance, entities must consistently categorize and provide greater disaggregation of information in the reconciliation of the effective tax rate to the statutory tax rate and must also further disaggregate income taxes paid. The Company adopted ASU 2023-09 for the year ended December 31, 2025 using a retrospective approach and 17 Table of Contents included the required disclosures in the Notes to the Consolidated Financial Statements for income taxes. This standard update did not affect the Company’s results of operations. New Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU No. 2024-03, Income Statement: Reporting Comprehensive Income-Expense Disaggregation Disclosures (“Subtopic 220-40”): Disaggregation of Income Statement Expenses . The new standard requires disclosure of specified information about certain costs and expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026 and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements disclosures. C. Segment Information Zevra manages its business activities on a consolidated basis and operates as a single operating segment dedicated to the research and development, manufacturing, commercialization and sale of innovative medicines and therapies. The Company primarily derives its revenue from MIPLYFFA and OLPRUVA product sales and reimbursements received under the global EAP. For the three months ended March 31, 2026 , and 2025 , the Company's revenue included royalties generated under the AZSTARYS License Agreement. Zevra's CODM is the Company's Chief Executive Officer, Neil F. McFarlane. The CODM uses net income (loss), as reported in the Company's unaudited condensed consolidated statements of operations, in evaluating performance of its segment and determining how to allocate resources of the Company as a whole, including investing in its research and development, commercialization efforts, and acquisition strategy. The CODM does not review assets in evaluating the results of the segment, and, therefore, such information is not presented. The accounting policies of the segment are the same as those described in Note B . The following table presents the operating results of the Company's segment for the three months ended March 31, 2026 and 2025 (in thousands): Three months ended March 31, 2026 2025 Total revenues $ 36,220 $ 20,401 Less significant segment expenses: Research and development directly identified to programs 2,932 2,361 Research and development not directly identified to programs 1,460 897 Selling, general and administrative directly identified to programs 6,432 7,561 Selling, general and administrative not directly identified to programs 14,351 11,984 Other segment items: Income tax expense 6,914 1,182 Interest income ( 2,184 ) ( 718 ) Depreciation and amortization expense 368 1,649 Interest expense 1,711 1,969 Other income, net (a) ( 33,654 ) ( 3,385 ) Segment net income (loss) $ 37,890 $ ( 3,099 ) (a) Other income, net, included in segment net income (loss) includes cost of product revenue, intangible asset amortization, gain on sale of future royalties, intellectual property, and other assets, net, loss on extinguishment of debt, loss on derivative liability, fair value adjustment related to warrant and contingent value right (“CVR”) liabilities, fair value adjustments related to investments, and other overhead expenses. The Company holds long-lived assets in the United States of $ 1.2 million and $ 2.2 million as of March 31, 2026, and December 31, 2025, respectively. The Company holds long-lived assets in Europe of $ 0.3 million and $ 0.4 million as of March 31, 2026, and December 31, 2025, respectively. 18 Table of Contents D. Inventories The components of inventory are summarized as follows (in thousands): March 31, 2026 December 31, 2025 Raw materials $ 7 $ 7 Work in progress 863 1,780 Finished goods 1,440 832 Total inventories $ 2,310 $ 2,619 E. Debt Obligations Term Loans On April 5, 2024 (the “Term Loans Closing Date”), the Company entered into a credit agreement (the “Credit Agreement”) with HCR Stafford Fund II, L.P., HCR Potomac Fund II, L.P., and Perceptive Credit Holdings IV, LP (collectively, the “Lenders”), and Alter Domus (US) LLC, as administrative agent (the “Administrative Agent”). Under the terms of the Credit Agreement, the Lenders provided a senior secured loan facility to the Company in the aggregate principal amount of $ 100.0 million, which was divided into three tranches as follows: (i) $ 60.0 million, which was funded in full on the Term Loans Closing Date; (ii) $ 20.0 million, which was available to the Company in up to two drawings, each in an amount not to exceed $ 10.0 million, at the Company's option until October 5, 2025; and; (iii) $ 20.0 million, which was available to the Company upon approval by the FDA of the NDA for MIPLYFFA for the treatment of NPC, at the Company’s option until December 31, 2024 (collectively, the “Term Loans”). The Company did not draw down the amounts described in (ii) and (iii) above prior to their applicable expiration dates. The proceeds of the Term Loans were used to refinance certain existing indebtedness of the Company and its subsidiaries. The Company used the remaining proceeds to pay fees and expenses related to the debt financing and commercialization of MIPLYFFA and OLPRUVA, and to further the development of its other product candidates. The Company evaluated the contractual terms of the Term Loans in accordance with ASC 815, Derivatives and Hedging, to determine whether any embedded features require bifurcation from the host debt instrument. The embedded features identified in the Term Loans included a mandatory prepayment provision upon the occurrence of certain triggering events. Based on its assessment, the Company determined that the mandatory repayment feature is not clearly and closely related to the host debt instrument and therefore requires bifurcation and separate accounting as a derivative instrument. The embedded derivative is not designated as a hedging instrument and is accounted for separately from the host debt instrument. The derivative is remeasured at each reporting date, with changes in fair value recognized in the unaudited consolidated statements of operations. As of December 31, 2025, the embedded derivative had no value as the Company determined that the probability of the associated triggering event was remote. For the three months ended March 31, 2026, the Company recognized a loss on derivative liability of $ 7.2 million in the unaudited condensed consolidated statements of operations. The embedded derivative was eliminated upon repayment of the Term Loans as described below. On March 12, 2026, the Company repaid in full all outstanding obligations under the Credit Agreement. As of the date of repayment, the aggregate principal amount outstanding under the Credit Agreement was approximately $ 63.1 million (which includes accrued paid-in-kind interest of approximately $ 3.1 million), plus accrued and unpaid cash interest of $ 1.4 million. Under the terms of the Credit Agreement, the Company was also required to pay a final payment premium of $ 1.8 million, a make-whole amount and prepayment premium of $ 7.2 million and legal fees of approximately $ 0.1 million. The Term Loans were secured by a first priority perfected lien on, and security interest in, substantially all current and future assets of the Company and certain of its subsidiaries that were guarantors thereunder. Upon repayment, the Credit Agreement and all related loan documents were terminated, and all liens and security interests granted thereunder were released. The Company recognized a loss on extinguishment of debt of $ 2.8 million in the unaudited condensed consolidated statements of operations during the three months ended March 31, 2026. Prior to the repayment, the principal amount of the Term Loans outstanding (the “Outstanding Principal Amount”) bore interest at a rate equal to 3-Month Term Secured Overnight Financing Rate (“SOFR”) plus 7.00 % per annum. The 3-Month Term SOFR rate was subject to a floor of 4.00 % per annum. Interest was payable quarterly in arrears on the last day of each calendar quarter. The Company had the option to pay up to 25 % of the interest in-kind beginning on the Term Loans Closing Date, through and including March 31, 2026. During the three months ended March 31, 2026, the Company repaid approximately $ 3.1 million of interest-in-kind. The Company had recognized approximately $ 3.1 million of interest-in-kind as of December 31, 2025, which is included in long-term debt in the unaudited condensed consolidated balance sheets. The Term Lo ans would have matured on April 5, 2029, the fifth anniversary of the Term Loans Closing date. 19 Table of Contents Long-term debt consisted of the following at December 31, 2025 (in thousands): December 31, 2025 Notes payable $ 63,608 Unamortized original issue discount ( 755 ) Less: debt issuance costs ( 925 ) $ 61,928 F. Revenue, net For the three months ended March 31, 2026, and 2025, the Company record ed $ 36.2 million and $ 20.4 million, respectively, of revenue. Product Revenues, net On September 20, 2024, the FDA approved MIPLYFFA (arimoclomol), an orally-delivered treatment for NPC, which is an ultra-rare and progressive neurodegenerative disease, for treatment in combination with miglustat. For the three months ended March 31, 2026, and 2025, sales of MIPLYFFA were $ 24.6 million and $ 17.1 million, respectively. On December 27, 2022, the FDA approved OLPRUVA (sodium phenylbutyrate), a prescription medicine used along with certain therapy, including changes in diet, for the chronic management of adults and children with certain UCDs. For the three months ended March 31, 2026, and 2025, sales of OLPRUVA were $ 0.3 million and $ 0.1 million, respectively. The Company currently utilizes a single specialty pharmacy provider as its sole distributor for both MIPLYFFA and OLPRUVA. The Company also enters into arrangements with health care providers and payors that provide for government mandated and/or privately negotiated rebates with respect to the purchase of its products. All estimated reserve liabilities related to commercial products are recorded within the current portion of discount and rebate liabilities in the unaudited condensed consolidated balance sheets. To commercialize MIPLYFFA and OLPRUVA in the United States, the Company has built marketing, sales, medical affairs, distribution, managerial and other non-technical capabilities or has made arrangements with third parties to perform these services. All revenues derived from sales of MIPLYFFA and OLPRUVA are in the United States. Expanded Access Program For the three months ended March 31, 2026, and 2025, the Company recognized revenue related to the global EAP of $ 10.2 million and $ 2.3 million, respectively, net of a clawback liability and other adjustments of $ 4.7 million and $ 1.7 million, respectively. The total estimated clawback reserve liability as of March 31, 2026, and December 31, 2025, was $ 16.9 million a nd $ 15.3 million, respectively. As of March 31, 2026, and December 31, 2025, this estimated reserve liability is recorded as discount and rebate liabilities in the unaudited condensed consolidated balance sheets and is separated into current and long-term based upon the timing of the expected payment to the French regulators. AZSTARYS License Agreement Under the AZSTARYS License Agreement, as amended, the Company granted to Commave an exclusive, worldwide license to develop, manufacture and commercialize the Company’s product candidates containing SDX and d-MPH, including AZSTARYS, or any other product candidates containing SDX and developed to treat ADHD or any other central nervous system disorder. Corium Inc. was tasked by Commave to lead all commercialization activities for AZSTARYS under the AZSTARYS License Agreement. Pursuant to the AZSTARYS License Agreement, Commave agreed to pay milestone payments up to an aggregate of $ 590.0 million upon the occurrence of specified regulatory milestones related to AZSTARYS, additional fixed payments upon the achievement of specified U.S. sales milestones, and quarterly, tiered royalty payments based on a range of percentages of net sales (as defined in the AZSTARYS License Agreement). Commave was obligated to make such royalty payments on a product-by-product basis until expiration of the royalty term for the applicable product. 20 Table of Contents The Company concluded that these regulatory milestones, sales milestones and royalty payments each contain a significant uncertainty associated with a future event. As such, these milestone and royalty payments are constrained at contract inception and are not included in the transaction price, as the Company could not conclude that it is probable a significant reversal in the amount of cumulative revenue recognized will not occur surrounding these milestone payments. At the end of each reporting period, the Company updates its assessment of whether the milestone and royalty payments are constrained by considering both the likelihood and magnitude of the potential revenue reversal. For the three months ended March 31, 2026 and 2025 , the Company recognized revenue under the AZSTARYS License Agreement of $ 1.1 million and $ 0.9 million, respectively, and all revenues recognized under this agreement were derived in the United States. There was no deferred revenue related to this agreement as of March 31, 2026, or December 31, 2025. As further discussed in Note A, the Company and Commave agreed to terminate the AZSTARYS License Agreement during the first quarter of 2026, and therefore will not recognize revenue in future periods under the agreement. The AZSTARYS License Agreement is within the scope of ASC 606, as the transaction represents a contract with a customer where the participants function in a customer/vendor relationship and are not exposed equally to the risks and rewards of the activities contemplated under the AZSTARYS License Agreement. Relief Exclusive License Agreement Pursuant to the Relief License Agreement, Relief holds exclusive development and commercialization rights for OLPRUVA in the European Union (“EU”), Liechtenstein, San Marino, Vatican City, Norway, Iceland, Principality of Monaco, Andorra, Gibraltar, Switzerland, United Kingdom, Albania, Bosnia, Kosovo, Montenegro, Serbia and North Macedonia (“Geographical Europe”). The Company has the right to receive a royalty of up to 10 % of the net sales of OLPRUVA in Geographical Europ e. For the three months ended March 31, 2026, and 2025, the Company did not recognize any revenue under the Relief License Agreement. There was no deferred revenue related to this agreement as of March 31, 2026, and December 31, 2025 . Accounts and Other Receivables Accounts and other receivables consist of receivables from MIPLYFFA and OLPRUVA product sales, receivables under the Commave Settlement Agreement, the global EAP, and other receivables due to the Company. Receivables under the global EAP are recorded for product sales of MIPLYFFA in France and select territories outside of Europe. The Company provides reserves against receivables for estimated losses that may result from a customer's inability to pay. Receivables are evaluated to determine if any reserve or allowance should be recorded based on consideration of the current economic environment, expectations of future economic conditions, specific circumstances and the Company’s own historical collection experience. Amounts determined to be uncollectible are charged or written-off against the reserve. Accounts and other receivables consist of the following (in thousands): March 31, 2026 December 31, 2025 Commercial accounts receivable $ 7,653 $ 9,876 Receivables related to product reimbursements 7,642 10,998 Receivables under the Commave Settlement Agreement 4,504 1,786 Other receivables 2,299 598 Total receivables $ 22,098 $ 23,258 As of March 31, 2026, and December 31, 2025, no r eserve or allowance for doubtful accounts had been established. G. Stock and Warrants Authorized, Issued, and Outstanding Common Shares As of March 31, 2026 , and December 31, 2025 , the Company had authorized shares of common stock of 250,000,000 shares. Of the authorized shares, 60,690,542 and 58,338,319 shares of common stock were issued as of March 31, 2026 , and December 31, 2025 , respectively, and 59,114,850 and 56,854,781 shares of common stock were outstanding as of March 31, 2026 , and December 31, 2025 , respectively. 21 Table of Contents As of March 31, 2026 , and December 31, 2025, the Company had reserved authorized shares of common stock for future issuance as follows: March 31, 2026 December 31, 2025 Outstanding awards under equity incentive plans 7,302,609 7,060,457 Outstanding common stock warrants 2,529,379 4,024,157 Possible future issuances under equity incentive plans 7,777,045 6,327,569 Possible future issuances under employee stock purchase plan 1,011,962 1,011,962 Total common shares reserved for future issuance 18,620,995 18,424,145 Common Stock Activity The following table summarizes common stock activity for t he three months ended March 31, 2026 : Shares of Common Stock Balance as of January 1, 2026 56,854,781 Common stock issued as a result of stock options exercised or RSUs vested 955,575 Common stock issued as a result of stock warrants exercised 1,304,494 Balance as of March 31, 2026 59,114,850 Authorized, Issued, and Outstanding Preferred Stock As of March 31, 2026 , and December 31, 2025 , th e Company h ad 10,000,000 shares of authorized, unallocated preferred stock. As of March 31, 2026 , and December 31, 2025, no shares of preferred stock were designated, issued, or outstanding. Warrants to Purchase Common Stock The Company has issued warrants to purchase common stock to various third parties, of which 2,529,379 remain outstanding as of March 31, 2026 , an d are im mediately exercisable. These warrants qualify as participating securities under ASC Topic 260, Earnings per Share , and are treated as such in the net income (loss) per share calculation (Note J) . The Company may be required to redeem these warrants for a cash amount equal to the BSM value of the portion of the warrants to be redeemed. While the warrants are outstanding (but unexercised), the warrant holders will participate in any dividend or other distribution of the Company’s assets to its common stockholders by way of return of capital or otherwise. As of March 31, 2026, 2,954,158 of the warrants had been exercised or expired. As of December 31, 2025, 1,459,380 warrants had been exercised. The warrants have been evaluated to determine the appropriate accounting and classification pursuant to ASC 480 and ASC 815. Generally, freestanding warrants should be classified as (i) liabilities if the warrant terms allow settlement of the warrant exercise in cash and (ii) equity if the warrant terms only allow settlement in shares of common stock. The Company determined that its outstanding warrants should be recorded as a liability and stated at fair value at each reporting period. Changes to the fair value of the warrant liability are recorded through the unaudited condensed consolidated statements of operations as a fair value adjustment related to warrant and CVR liability. As of March 31, 2026, and December 31, 2025, the fair value of the liability associated with these warrants w as approximate ly $ 6.8 million a nd $ 9.6 million, respectively. The fair value adjustment related to these warrants for the three months ended March 31, 2026, and 2025, was $ 0.8 million and $ 4.8 million of income, re spectively. 22 Table of Contents H. Stock-Based Compensation In November 2014, the Board of Directors of the Company (“the Board”), and in April 2015, the Company’s stockholders, approved the Company’s 2014 Equity Incentive Plan (the “2014 Plan”), which became effective in April 2015. The 2014 Plan provides for the grant of stock options, other forms of equity compensation, and performance cash awards. In June 2021, the Company's stockholders approved an Amended and Restated 2014 Equity Incentive Plan (the “A&R 2014 Plan”), following its adoption by the Board in April 2021, which, among other things, added 4,900,000 shares to the maximum number of shares of common stock to be issued under the plan and extended the annual automatic increases (discussed further below) until January 1, 2031 and eliminated individual grant limits that applied under the 2014 Plan to awards that were intended to comply with the exemption for “performance-based compensation” under Code Section 162(m). The maximum number of shares of common stock that may be issued under the A&R 2014 Plan was 14,353,902 as of March 31, 2026. The number of shares of common stock reserved for issuance under the A&R 2014 Plan automatically increases on January 1 of each year, beginning on January 1, 2016, and ending on and including January 1, 2031, by 4 % of the total number of shares of the Company’s capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the Board. Pursuant to the terms of the A&R 2014 Plan, on January 1, 2026, the common stock reserved for issuance under the A&R 2014 Plan automatically increased by 2,274,191 shares. During the three months ended March 31, 2026, and 2025, 976,818 and 889,025 stock options were exercised, respectively. In June 2021, the Company's stockholders approved an Employee Stock Purchase Plan (the “ESPP”), following its adoption by the Board in April 2021. The maximum number of shares of common stock that may be issued under the ESPP is 1,500,000 . The first offering period under the ESPP began on October 1, 2021, and the first purchase date occurred on May 31, 2022. As of March 31, 2026, 488,038 shares have been issued under the ESPP. In January 2023, the Board approved the 2023 Employment Inducement Award Plan (as amended, the “2023 Plan”) to make equity awards to newly hired employees as a material inducement to employment in accordance with Nasdaq Rule 5635(c)(4). The maximum number of shares of common stock that may be issued under the 2023 Plan was 4,500,000 as of March 31, 2026. In February 2025, the Board approved the Tenth Amended and Restated Non-Employee Director Compensation Policy (the “Non-Employee Director Compensation Policy”). The equity compensation granted pursuant to the Non-Employee Director Compensation Policy is granted under the A&R 2014 Plan. Stock-based compensation expense recorded under the A&R 2014 Plan, ESPP and 2023 Plan is included in the following line items in the accompanying unaudited condensed consolidated statements of operations (in thousands): Three months ended March 31, 2026 2025 Research and development $ 220 $ 357 Selling, general and administrative 2,885 2,758 Total stock-based compensation expense $ 3,105 $ 3,115 There was no stock-based compensation expense related to performance-based awards recognized during the three months ended March 31, 2026, and 2025, as the probability criteria was not met. I. Fair Value of Financial Instruments The accounting standard for fair value measurements provides a framework for measuring fair value and requires disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, based on the Company’s principal or, in absence of a principal, most advantageous market for the specific asset or liability. 23 Table of Contents The Company uses a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement. The hierarchy requires the Company to use observable inputs, when available, and to minimize the use of unobservable inputs when determining fair value. The three tiers are defined as follows: • Level 1: Observable inputs that reflect quoted market prices (unadjusted) for identical assets or liabilities in active markets; • Level 2: Observable inputs other than quoted prices in active markets that are observable either directly or indirectly in the marketplace for identical or similar assets and liabilities; and • Level 3: Unobservable inputs that are supported by little or no market data, which require the Company to develop its own assumptions. The carrying amounts of certain financial instruments, including cash and cash equivalents, accounts and other receivables, and accounts payable and accrued expenses approximate their respective fair values due to the short-term nature of such instruments. Assets and Liabilities Measured at Fair Value on a Recurring Basis The Company evaluates its financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them for each reporting period. This determination requires significant judgments to be made. The following table summarizes the conclusions reached regarding fair value measurements a s of March 31, 2026 , and December 31, 2025 (in tho usands): Balance as of March 31, 2026 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Warrant liabilities $ 6,797 $ — $ — $ 6,797 CVR liability 1,360 — — 1,360 Embedded derivative — — — — Total liabilities $ 8,157 $ — $ — $ 8,157 Securities: U.S. Treasury securities $ 71,976 $ 71,976 $ — $ — Corporate bonds 69,190 — 69,190 — Total assets $ 141,166 $ 71,976 $ 69,190 $ — Balance as of December 31, 2025 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Warrant liabilities $ 9,575 $ — $ — $ 9,575 CVR liability 1,540 — — 1,540 Embedded derivative — — — — Total liabilities $ 11,115 $ — $ — $ 11,115 Securities: U.S. Treasury securities $ 97,132 $ 97,132 $ — $ — Corporate bonds 79,352 — 79,352 — Total assets $ 176,484 $ 97,132 $ 79,352 $ — 24 Table of Contents Warrants The com mon stock warrant li abilities were recorded at fair value using the BSM option pricing model. The following assumptions were used in determining the fair value of the warrant liabilities valued using the BSM option pricing mode l as of March 31, 2026 , and December 31, 2025: March 31, 2026 December 31, 2025 Risk-free interest rate 3.63 % - 3.73 % 3.42 % - 3.67 % Volatility 58.94 % - 63.63 % 57.28 % - 66.70 % Dividend yield — % — % Expected term (years) 0.75 - 2.65 0.02 - 2.89 Weighted average fair value $ 2.69 $ 2.38 The following table is a reconciliation for the common stock warrant liabilities measured at fair val ue using Level 3 un observable inputs (in thousands): Balance as of December 31, 2025 $ 9,575 Change in fair value measurement of warrant liabilities ( 788 ) Warrants exercised ( 1,990 ) Balance as of March 31, 2026 $ 6,797 For the three months ended March 31, 2026 , the changes in fair value of the warrant liab ilities primarily resulted from changes in the discount rate and volatility. Contingent Consideration Contingent consideration liabilities relate to the Company's liabilities arising in connection with the CVRs. The contingent consideration is classified as Level 3 in the fair value hierarchy. The fair value is measured based on a Monte Carlo simulation or a scenario-based method, depending on the earn-out achievement objectives, utilizing projections about future performance. Significant inputs include volatility and projected financial information, including projections representative of a market participant's view of the expected cash payments associated with the agreed upon regulatory milestones based on probabilities of technical success, timing of the potential milestone events for the compounds, and estimated discount rates. The following table provides a reconciliation of the beginning and ending balances related to the contingent consideration liabilities for the CVRs (in thousands): Balance as of December 31, 2025 $ 1,540 Change in fair value measurement of contingent consideration liabilities ( 180 ) Balance as of March 31, 2026 $ 1,360 For the three months ended March 31, 2026, the changes in fair value of contingent consideration primarily resulted from changes in market data and revenue projections. Embedded Derivative The fair value of the embedded derivative is classified as Level 3 in the fair value hierarchy and had no value at March 31, 2026 and December 31, 2025. The liability associated with the embedded derivative represented the fair value of the mandatory redemption provision in the Credit Agreement. During the three months ended March 31, 2026, all outstanding obligations under the Credit Agreement were paid off which represented a triggering event. The embedded derivative was then re-valued, and extinguished together with the debt (see Note E). The fair value was determined using a Black-Derman-Toy (“BDT”) binomial lattice model in conjunction with a discounted cash flow methodology. The valuation incorporates a discount rate derived from the risk-free rate, based on the US Treasury Daily Treasury Par Yield Curve. The quantitative information about the significant unobservable inputs used in the Level 3 fair value measurement for the embedded derivative includes a credit spread of 5.53 %. 25 Table of Contents The following table provides a reconciliation of the beginning and ending balances related to the embedded derivative (in thousands): Balance as of December 31, 2025 $ — Change in fair value measurement of embedded derivative 7,216 Extinguishments ( 7,216 ) Balance as of March 31, 2026 $ — For the three months ended March 31, 2026, the changes in fair value of the embedded derivative resulted from a change in probability of a triggering event occurring. J. Net Income (Loss) Per Share The two-class method requires earnings for the period to be allocated between common stock and participating securities based upon their respective rights to receive distributed and undistributed earnings. Under the two-class method, for periods with net income attributable to common stockholders, basic net income attributable to common stockholders per share of common stock is computed by dividing the net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Undistributed net income attributable to common stockholders is computed by subtracting from net income the portion of current period earnings that participating securities would have been entitled to receive pursuant to their dividend rights had all of the period’s earnings been distributed. No such adjustment to earnings is made during periods with a net loss as the holders of the participating securities have no obligation to fund losses. Diluted net income attributable to common stockholders per share of common stock is computed under the two-class method by using the weighted average number of shares of common stock outstanding plus the potential dilutive effects of stock options and warrants. In addition to analyzing under the two-class method, the Company analyzes the potential dilutive effect of stock options and warrants under the treasury-stock method when calculating diluted income (loss) attributable to common stockholders per share of common stock, in which it is assumed that the stock options and warrants convert into common stock at the beginning of the period or date of issuance, if the stock option or warrant was issued during the period. The Company reports the more dilutive of the approaches (two-class or treasury-stock/if-converted) as its diluted net income (loss) attributable to common stockholders per share of common stock during the period. Diluted net loss per share of common stock is the same as basic net loss per share of common stock for the three months ended March 31, 2025, because the effects of potentially dilutive items were anti-dilutive for the respective periods. The following securities, presented on a common stock equivalent basis, have been excluded from the calculation of weighted-average number of shares of common stock outstanding because their effect is anti-dilutive: Three months ended March 31, 2026 2025 Awards under equity incentive plans 3,005,545 7,734,741 Common stock warrants — 5,483,527 Total securities excluded from the calculation of weighted average number of shares of common stock outstanding 3,005,545 13,218,268 26 Table of Contents A reconciliation from net income (loss) to basic net income (loss) attributable to common stockholders per share of common stock and diluted net income (loss) attributable to common stockholders per share of common stock for the three months ended March 31, 2026, and 2025 is as follows (in thousands): Three months ended March 31, 2026 2025 Basic net income (loss) per share of common stock: Net income (loss) $ 37,890 $ ( 3,099 ) Earnings allocated to participating securities ( 1,573 ) — Net income (loss) attributable to shares of common stock 36,317 ( 3,099 ) Less: Dividends declared or accumulated — — Undistributed net income (loss) attributable to shares of common stock, basic 36,317 ( 3,099 ) Weighted-average shares of common stock outstanding 58,406 54,096 Basic net income (loss) per share of common stock $ 0.62 $ ( 0.06 ) Diluted net income (loss) per share of common stock: Net income (loss) attributable to shares of common stock $ 36,317 $ ( 3,099 ) Plus: Fair value adjustment income related to warrant liability — — Net income (loss) attributable to shares of common stock, diluted 36,317 ( 3,099 ) Weighted-average number of shares of common stock outstanding 58,406 54,096 Dilutive effect of outstanding stock options (as converted to common stock) 1,825 — Weighted-average shares of common stock outstanding, diluted 60,230 54,096 Diluted net income (loss) per share of common stock $ 0.60 $ ( 0.06 ) K. Leases The Company has operating leases for office space and determines if an arrangement is a lease at contract inception. Lease assets and lease liabilities are recognized based on the present value of lease payments over the lease term at the commencement date. The Company does not separate lease and non-lease components. Leases with a term of 12 months or less at commencement are not recorded on the unaudited condensed consolidated balance sheets. Lease expense for these arrangements is recognized on straight-line bases over the lease term. The Company’s leases have remaining lease terms of less than one year and up to approximately three years , and some which include options to terminate the leases within one year . In March 2026, we entered into a lease related to our corporate headquarters to provide us with additional office space, expected to commence in June 2026. The future minimum lease payments for operating leases executed but not commenced as of March 31, 2026 are estimated to be $ 0.1 million, $ 0.3 million, and $ 0.1 million, respectively, for each of the years ended December 31, 2026, 2027, and 2028. The components of operating lease expense were as follows (in thousands): Three months ended March 31, 2026 2025 Operating lease cost 156 118 Short-term lease cost — 47 Less: sublease income ( 26 ) ( 39 ) Total lease costs $ 130 $ 126 27 Table of Contents Supplemental cash flow information related to leases was as follows (in thousands): Three months ended March 31, 2026 2025 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 162 $ 215 Operating cash flows from short-term leases — 47 Right-of-use assets obtained in exchange for lease liabilities: Operating leases $ — $ 1,115 Supplemental balance sheet information related to operating leases was as follows (in thousands, except weighted average remaining lease term and weighted average discount rate): March 31, 2026 December 31, 2025 Operating lease right-of-use assets $ 1,087 $ 1,212 Current portion of operating lease liabilities $ 406 $ 419 Operating lease liabilities, less current portion 741 859 Total operating lease liabilities $ 1,147 $ 1,278 Weighted average remaining lease term 2.5 3.0 Weighted average discount rate 13.1 % 13.0 % Maturities on lease liabilities were as follows (in thousands): Year Ended December 31, 2026 (excluding the three months ended March 31, 2026) $ 396 2027 549 2028 369 2029 41 Total lease payments 1,355 Less: future interest expense ( 208 ) Lease liabilities $ 1,147 L. Goodwill & Intangible Assets The Company's goodwill balance was $ 4.7 million as of March 31, 2026, and December 31, 2025. As of March 31, 2025, the Company had a definite-lived intangible asset, net related to the acquisition of OLPRUVA of $ 60.0 million. This was amortized on a straight-line basis over the OLPRUVA patent life of 13 years and was reviewed periodically for impairment. Amortization expense was recorded as intangible asset amortization in the unaudited condensed consolidated statements of operations and was $ 1.3 million for the three months ended March 31, 2025. The definite-lived intangible assets that are subject to amortization were reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. In the first quarter of 2025, the Company's historical sales experience related to OLPRUVA resulted in management preparing an estimate of future cash flows used to assess the recoverability of such asset. Future cash flows specific to OLPRUVA, which most significantly included an estimate of forecasted revenues, are based on reasonable and supportable assumptions regarding the cash flows expected to result from the use of the asset and its eventual disposition. As a result of the Company's analysis, the asset was deemed to be fully recoverable and no impairments were recorded by the Company for the three months ended March 31, 2025. 28 Table of Contents In the second quarter of 2025, t he Company assessed the results of its refined commercial efforts related to OLPRUVA. This was determined to be a triggering event that could result in a decrease in future expected cash flows, and thus indicated the carrying amount of the OLPRUVA asset group may not be fully recoverable. The Company performed an undiscounted cash flow analysis over the OLPRUVA asset group and determined that the carrying value of the asset group was not recoverable. The Company then estimated the fair value of the asset group to measure the impairment loss for the period. The fair value measurement was based on Level 3 inputs including projected sales driven by market share and product sales price estimates, associated expenses, growth rates, and the discount rate used to measure the fair value of the net cash flows associated with this asset group. The Company recorded an intangible asset impairment charge in the second quarter of 2025, which resulted in reducing the OLPRUVA intangible asset value to zero. In connection with the XOMA License Agreement, a regulatory milestone payment of $ 6.0 million was due to XOMA upon approval of MIPLYFFA in the United States, which the Company paid in October 2024. This definite-lived intangible asset is amortized on a straight-line basis over the MIPLYFFA patent life of approx imately five years a nd is reviewed periodically for impairment. Amortization expense is recorded as intangible asset amortization in the unaudited condensed consolidated statements of operations and was $ 0.3 million for both the three months ended March 31, 2026, and 2025 . For intangible assets subject to amortization, estimated amortization expense for the five fiscal years subsequent to March 31, 2026, is expected to be as follows (in thousands): 2026 (excluding the three months ended March 31, 2026) $ 947 2027 1,263 2028 1,263 2029 632 2030 — As of March 31, 2026, and December 31, 2025, non-amortizable intangible assets include IPR&D of $ 2.0 million. M. Commitments and Contingencies Legal Matters From time to time, the Company is involved in various legal proceedings arising in the normal course of business. For some matters, a liability is not probable, or the amount cannot be reasonably estimated and, therefore, an accrual has not been made. However, for such matters when it is probable that the Company has incurred a liability and can reasonably estimate the amount, the Company accrues and discloses such estimates. Litigation Related to the AZSTARYS License Agreement In September 2024, the Company became engaged in a legal dispute with Commave regarding the AZSTARYS License Agreement. The litigation was in the discovery phase but was resolved under the Commave Settlement Agreement in March 2026 (Note A), and a Stipulation of Dismissal with Prejudice was filed on March 16, 2026. As of March 31, 2026, and December 31, 2025, no accruals were made related to commitments and contingencies. N. Subsequent Events The Company evaluated events and trans actions occurring subsequent to March 31, 2026, through May 6, 2026, the date the accompanying unaudited condensed consolidated financial statements were issued. During this period, there were no subsequent events that required recognition in the accompanying unaudited condensed consolidated financial statements, nor were there any additional non-recognized subsequent events that required disclosure. 29 Table of Contents