ARWR 10-K & 10-Q changes, risk factors and insider trading

The Company’s business involves various risks and uncertainties in addition to the normal risks of business, some of which are discussed in this section. It should be noted that the Company’s business may be adversely affected by general economic conditions and other forcesfactors beyond the Company’s control. In addition, other risks and uncertainties not presently known or that the Company currently believes to be immaterial may also adversely affect the Company’s business. Some of the factors, events, and contingencies discussed below may have occurred in the past, but the disclosures below are not representations as to whether or not the factors, events, or contingencies have occurred in the past, and instead reflect our beliefs and opinions as to the factors, events or contingencies that could materially and adversely affect us in the future. Any such risks or uncertainties, or any of the following risks or uncertainties, that develop into actual events could result in a material and adverse effect on the Company’s business, financial condition, results of operations, or liquidity.

•Our prospects substantially depend on the success of our clinical-stage product candidates. If we and our licensees are unable to obtain approval for and commercialize these product candidates, or successfully commercialize REDEMPLO, our business could be materially harmed.

•There are substantial risks inherent in attempting to commercialize our new drugs, and, as a result, we may not be able to successfully develop additional products for commercial use.

•Our clinical trials may reveal significant adverse events, toxicities or other side effects and may result in a safety profile that could inhibitimpede regulatory approval or market acceptance of any of our product candidates.

•We face potential product liability exposure, and if successful claims are brought against us, we may incur substantial liability forfrom aREDEMPLO, or any other approved product candidatecandidate, and may have to limit its commercialization.

•The successful commercialization of ourREDEMPLO, or any other product candidates, if approved, will depend in part on the extent to which government authorities and health insurers establish adequate reimbursement levels and pricing policies.

•Our commercialization, collaborative and other arrangements may give rise to disputes over commercial terms, contract interpretationinterpretation, and ownership or protection of our intellectual property and may adversely affect the commercial success of our products.product candidates.

•A Fast Track or Breakthrough Therapy product designation may not lead to a faster development or regulatory review or approval process, and it does not increase the likelihood that our product candidates will receive marketing approval.

•Even if our product candidates are approved for commercialization, failureFailure to comply with regulatory requirements or unanticipated problems with our products may result in various adverse actions such as the suspension or withdrawal of one or more of our products, closure of a facility or enforcement of substantial penalties or fines.

•Our business model assumes we will generate revenue by, among other activities, marketing or out-licensing the products we develop. Our drugproduct candidates are in various stages of development and we have noonly approvedone productsproduct based on RNA interferenceRNAi and our delivery technologies.technologies approved in November 2025. Accordingly, there is a limited amount of information about us upon which you can evaluate our business and prospects.

•We may need to establish additional relationships with strategic and development partners to fully develop our drugproduct candidates and market any approved products.

•Our ability to generate milestone and royalty payments under our current and potential future licensing and collaboration agreements is substantially controlled by our partners, and as such, we will likely need other sources of financing to continue to develop our internal drugproduct candidates.

•We will need to achieve commercial acceptance of REDEMPLO and our drugother product candidates to generate revenues and achieve profitability.

•If the market opportunities for ourREDEMPLO, or any other approved product candidates, if any, are smaller than we expect, it could materially and adversely affect our financial condition and results of operations.

•We have limited manufacturing capability and capacity and must rely on third-party manufacturers to manufacture certain of our clinical supplies and our commercial products, if and when approved, and if they fail to meet their obligations, the development and commercialization of our products could be adversely affected.

•Our operations, including our relationships with healthcare providers, physiciansphysicians, and third-party payers,payers are subject to applicable anti-kickback, fraud and abuse, and other healthcare laws and regulations, which, in the event of a violation, exposes us to liability for criminal sanctions, civil penalties, and contractual damages, and reputational harm and diminished profits and future earnings.

•RegulatoryEvolving regulatory standards are subject to change over time, makingmake it difficult to accurately predict the likelihood of marketing approval even when clinical trials meet their endpoints.

Our prospects substantially depend on the success of our clinical-stage product candidates. If we and our licensees are unable to obtain approval for and commercialize these product candidates, or successfully commercialize REDEMPLO, our business could be materially harmed.

Our future success is substantially dependent on the ability of ourthe companyCompany and our licensees to timely complete clinical trials and obtain marketing approval for, and then successfully commercialize our clinical-stage product candidates. We are not permitted to market or promote our product candidates before we receive marketing approval from the FDA and comparable foreign regulatory authorities, and we may never receive such marketing approvals.

•the extent of any required post-marketing approval commitmentscommitments, potentially including post-marketing clinical trials or other studies, to applicable regulatory authorities;

•commercial acceptance by patients, the medical community and third-party payorspayers; and

There are substantial risks inherent in attempting to commercialize our new drugs, and, as a result, we may not be able to successfully develop additional products for commercial use.

Scientific research and development requires significant amounts of capital and takeseven approved drug candidates take a long time to reach commercial viability if it can be achieved at all. To date, our research and development projects have not produced commercially viable drugs and may never do so. During the research and development process, we may experience technological barriers that we may be unable to overcome. Because we use platform technology to develop drug candidates, toxicology signals that may emerge in the course of testing of one particular candidate may apply broadly across our drug candidate platform. Further, certain underlying premises in our development programs are not proven and many of the drug targets that we are pursuing have not yet been validated clinically. For instance, ARO-RAGE has demonstrated the ability to reduce the expression of RAGE in the lung, however it has not been established that this will have an anti-inflammatory effect sufficient for a meaningful clinical benefit in patients with inflammatory lung disease. Further, it is also unknown at this time what may be required to gain favorableadequate reimbursement.reimbursement by either commercial or government payers. With respect to fazirsiran, it is also unknown at this time what changes in the liver may be required to gain regulatory approval and/or favorableadequate reimbursement for a drug that reduces the production of mutant alpha-1 antitrypsin in the liver. Similar uncertainties and risks exist that are specific to each of our development programs. Because of these and similar uncertainties, it is possible that no commercial products will be successfully developed. If we are unable to successfully develop commercial products, we will be unable to generate revenue or build a sustainable or profitable business.

Since 2011, we have focused substantially all of our efforts and financial resources on identifying, acquiring and developing our product candidates, including conducting lead optimization, nonclinical studies, preclinical studies and clinical trials, and providing general administrative support for these operations. And, the clinical-stage product candidates we currently have under development will require significant development, preclinical and clinical testing and investment of significant funds to gain regulatory approval before they can be approved for commercialization. The results of our research and human clinical testing of our products may not meet regulatory requirements. Some of our product candidates, if approved, may require the completion of post-market studies. There can be no assurance that any of our products will be further developed and approved. The process of completing clinical testing and obtaining required approvals will take several years and require the use of substantial resources. For instance, we currently plan to study plozasiran in a cardiovascular outcomes trial, and cardiovascular outcomes trials are expensive clinical trials performed in a large number of subjects over several years. Further, there can be no assurance that product candidates employing a new technology will be shown to be safe and effective in clinical trials or receive applicable regulatory approvals. If we fail to obtain regulatory approvals for any or all of our products, we will not be able to market such product and our operations may be adversely affected.

We cannot be certain that current clinical trials or any future clinical trials, whether conducted by us or our licensees, will be successful. Additionally, any safety concerns observed in any one of our clinical trials in our targeted indications could limit the prospects for regulatory approval of our product candidates in those and other indications, which could have a material adverse effect on our business, financial condition and results of operation. Success in clinical trials in a particular indication does not ensure that a product candidate will be successful in other indications. Similarly, approval of a product candidate in a particular indication does not ensure that the product candidate will be successful in other indications. For instance, although plozasiran’sREDEMPLO’s Phase 3 PALISADE trial for patients with FCS was successful in achieving its primary endpoint and all multiplicity-controlled key secondary endpoints, and we have filed an NDA with the FDA on November 16, 2024 and soughtfor regulatory approval with additional global regulatory authorities thereafter,authorities, there can be no guarantee that the FDA or anotherglobal regulatory authorityauthorities approvesthat plozasiranhave not already approved REDEMPLO for the treatment of FCS,FCS will do so, and plozasiranREDEMPLO may not succeed in achieving its clinical trial endpoints or be approved for the treatment of larger indications such as sHTG or ASCVD because the endpoints and clinical data required for approval in a rare disease indication are different from what is required for a broader patient population. Moreover, results acceptable to support approval in one jurisdiction may be deemed inadequate by another regulatory authority to support regulatory approval in that other jurisdiction. To the extent that the results of the trials are not satisfactory to the FDA or comparable foreign regulatory authorities for support of a marketing application, we may be required to expend significant resources, which may not be available to us, to conduct additional trials in support of potential approval of our product candidates. Even if regulatory approval is secured for a product candidate, the terms of such approval may limit the scope and use of the specific product candidate, which may also limit its commercial potential.

Although to date our current drugproduct candidates have generally evidenced an acceptable safety profile in clinical trials, patients treated with REDEMPLO or any of our products,product candidates, if approved, may experience previously unreported adverse reactions or minor incidences of adverse reactions may manifest with greater frequency in subsequent larger trials, and it is possible that the FDA or other regulatory authorities may ask for additional safety data as a condition of, or in connection with, our efforts to obtain approval of our product candidates. If toxicities, adverse events or any other safety problems occur or are identified after our products, if any,products reach the market, we may make the decision or be required by regulatory authorities to conduct additional clinical safety trials, amend the labeling of our products or add additional warnings to the labeling, recall our products, or even withdraw approval for our products.

We may publicly disclose topline or interim data from time to time, which is based on a preliminary analysis of then-available efficacy and safety data which are based on preliminary analysis of key efficacy and safety data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to the particular study or trial. We also make assumptions, estimations, calculations and conclusions as part of our analyses of data, and we may not have received or had the opportunity to fully and carefully evaluate all data. As a result, the topline results that we report may differ from future results of the same studies, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated. Topline data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary data we previously published. As a result, topline data should be viewed with caution until the final data are available. Further, others, including regulatory agencies, may not accept or agree with our assumptions, estimations, calculations, conclusions or analyses or may interpret or weigh the importance of data differently, which could impact the value of the particular program, the approvability or commercialization of the particular drug candidate or drug and ourthe companyCompany in general. In addition, the information we may publicly disclose regarding a particular study or clinical trial is based on what is typically extensive information, and you or others may not agree with what we determine is the material or otherwise appropriate information to include in our disclosure, and any information we determine not to disclose may ultimately be deemed significant with respect to future decisions, conclusions, views, activities or otherwise regarding a particular drug, drug candidate or our business. If the topline data that we report differ from a future analysis of results, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for and commercialize our product candidates, our business, operating results, prospects or financial condition may be harmed.

We face potential product liability exposure, and if successful claims are brought against us, we may incur substantial liability forfrom aREDEMPLO, or any other approved product candidatecandidate, and may have to limit its commercialization.

The use of our product candidates in clinical trials and the sale of REDEMPLO, or any other products for which we obtain marketing approval expose us to the risk of product liability claims. Product liability claims might be brought against us by clinical trial participants, consumers, healthcare providers, pharmaceutical companies, or others selling our products. If we cannot successfully defend ourselves against these claims, we may incur substantial liabilities. Regardless of merit or eventual outcomes of such claims, product liability claims may result in:

The successful commercialization of ourREDEMPLO, or any other approved product candidates, if approved, will depend in part on the extent to which government authorities and health insurers establish adequate reimbursement levels and pricing policies.

Sales of REDEMPLO, or any other approved drug candidatecandidate, will depend in part on the availability of coverage and reimbursement from third-party payers such as government insurance programs, including Medicare and Medicaid, private health insurers, health maintenance organizations and other health care related organizations, who are increasingly challenging the price of medical products and services. Accordingly, coverage and reimbursement may be uncertain. Adoption of any drug by the medical community may be limited if third-party payers will not offer adequate coverage. Additionally, significant uncertainty exists as to the reimbursement status of newly-approved drugs.drugs, including REDEMPLO. Cost control initiatives may decrease coverage and payment levels for any drug and, in turn, the price that we will be able to charge and/or the volume of our sales. We are unable to predict all changes to the coverage or reimbursement methodologies that will be applied by private or government payers. Any denial of private or government payer coverage or inadequate reimbursement could harm our business and reduce our revenue. With respect to our partnered product candidates, we will be reliant on that partner to obtain reimbursement from government and private payorspayers for the drug, if approved, and any failure of that partner to establish adequate reimbursement could have a negative impact on our revenues and profitability.

In addition, both the federal and state governments in the United States and foreign governments continue to propose and pass new legislation, regulations, and policies affecting coverage and reimbursement rates, which are designed to contain or reduce the cost of health care. Further federal and state proposals and healthcare reforms are likely, which could limit the prices that can be charged for the product candidates that we develop and may further limit our commercial opportunity. For example, the IRA includes several measures intended to lower the cost of prescription drugs and related healthcare reforms, including limits on price increases and subjecting an escalating number of drugs to annual price negotiations with CMS (Thethe Centers for Medicare & Medicaid Services ("CMS"). In addition, an executive order issued by the White House on May 12, 2025, directs the Department of Health and Human Services (the “HHS”) to implement a “Most Favored Nation” drug pricing policy. See also “The healthcare system is under significant financial pressure to reduce costs, which could reduce payment and reimbursement rates for drugs.” And the recently-enacted One Big Beautiful Bill Act (the “OBBBA”) imposes new restrictions on funding for government health care programs and on individual eligibility for coverage under those programs, which may lead to lower reimbursements for drugs covered by those programs. We cannot be sure whether additional legislation or rulemaking related to thethese IRAdevelopments will be issued or enacted, or what impact, if any, such changes will have on the profitability of any of our drug candidates, if approved for commercial use, in the future. There also may be future changes unrelated to the IRAthese that result in reductions in potential coverage and reimbursement levels for our product candidates, if approved and commercialized, and we cannot predict the scope of any future changes or the impact that those changes would have on our operations.

Although we may obtain orphan designations in the treatment of certain diseases our products are intended to treat, the designation may not be applicable to any particular product we might get approved and that product may not be the first product to receive approval for that indication. Under the Orphan Drug Act, the first approved product with an orphan designation receives market exclusivity, which prohibits the FDA from approving the “same” drug for the same indication. The FDA has stated that drugs can be the “same” even when they are not identical but has not provided guidance with respect to how it will determine “sameness” for RNAi drugs. It is possible that another RNAi drug could be approved for the treatment of a disease that one of our orphan products is intended to treat before our product is approved, which means that we may not obtain orphan drug exclusivity and could also potentially be blocked from approval until the first product’s orphan drug exclusivity period expires or we demonstrate, if we can, that our product is superior. Further, even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different drugs can be approved for the same condition. Even after an orphan drug is approved and granted orphan drug exclusivity, the FDA can subsequently approve the same drug for the same condition if the FDA concludes that the later drug is safer, more effective or makes a major contribution to patient care. In addition, a designated Orphan Drug may not receive orphan drug exclusivity if it is approved for a use that is broader than the disease for which it received orphan designation. Recent court decisions have created uncertainty in the application and interpretation of orphan drug exclusivity. Further, orphan drug exclusivity can be lost if the FDA later determines that the request for designation was materially defective or if the applicant is unable to assure the availability of sufficient quantities of the drug to meet the needs of patients with the disease or condition for which the drug was designated. Orphan Drug designation neither shortens the development time or regulatory review time of a drug nor gives the drug any advantage in the regulatory review or approval process.

Breakthrough Therapy designation for Plozasiran and/or Fazirsiran (formerly ARO-AAT) and other of our current or future product candidates and other of our current or future product candidates may not lead to a faster development or review process.

We have been granted a Breakthrough Therapy designation for plozasiran in the United States for the treatment of FCS and fazirsiran in the United States for the treatment of liver disease associated with AATD.AATD, and we may seek Breakthrough Therapy designation for other current or future product candidates. Breakthrough Therapy designation is intended to facilitate the development and expedite the review of new therapies to treat serious conditions with unmet medical needs by providing sponsors with the opportunity for frequent interactions and additional drug development guidance with the FDA and its senior managers. Breakthrough Therapy designation applies to the combination of the drugproduct candidate and the specific indication for which it is being studied. Product candidates that receive Breakthrough Therapy designation may receive more frequent interactions with the FDA regarding the product candidate’s development plan and clinical trials and may be eligible for the FDA’s Rolling Review.

Despite receiving Breakthrough Therapy designation, plozasiranfazirsiran and/or fazirsiranother product candidates may not actually benefit from faster clinical development or regulatory review or approval any sooner than other product candidates that do not have such designation, or at all. For example, although we received Breakthrough Therapy designation for REDEMPLO in the United States for the treatment of FCS, REDEMPLO was ultimately reviewed on a standard timeline. Furthermore, such a designation does not increase the likelihood that plozasiranfazirsiran or fazirsiranother product candidates will receive marketing approval in the United States. The FDA may also rescind Breakthrough Therapy designation if it determines that plozasiranfazirsiran or fazirsiranother product candidates no longer meets the relevant criteria.

We have received a Fast Track product designation for plozasiranfazirsiran in the United States for the treatment of FCS,liver disease associated with AATD, and we may seek Fast Track designation for other of our current or future product candidates. The Fast Track designation is a program offered by the FDA designed to facilitate drug development and to expedite the review of new drugs that are intended to treat serious or life-threatening conditions. Compounds selected must demonstrate the potential to address unmet medical needs. The FDA’s Fast Track designation allows for close and frequent interaction with the FDA. A designated Fast Track drug may also be considered for priority review with a shortened review time, rolling submission, and accelerated approval if applicable.

A Fast Track designation does not, however, guarantee FDA approval or expedited approval of any application for the product candidate. The receipt of such a designation for a product candidate may not result in a faster development process, review, or approval compared to drugs considered for approval under conventional FDA procedures and does not assure ultimate marketing approval by the FDA. For example, although we received Fast Track designation for REDEMPLO in the United States for the treatment of FCS, REDEMPLO was ultimately reviewed on a standard timeline. In addition, the FDA may later decide that the products no longer meet the designation conditions.

We and our licensees currently conduct clinical trials outside the United States. The acceptance by the FDA or comparable foreign regulatory authority of study data from clinical trials conducted outside the United States or another jurisdiction may be subject to certain conditions or may not be accepted at all. In cases where data from foreign clinical trials are intended to serve as the basis for marketing approval in the United States, the FDA will generally not approve the application on the basis of foreign data alone unless (i) the data are applicable to the U.S. population and U.S. medical practice; (ii) the trials were performed by clinical investigators of recognized competence and pursuant to GCP regulations; and (iii) the data may be considered valid without the need for an on-site inspection by the FDA or, if the FDA considers such as inspection to be necessary, the FDA is able to validate the data through an on-site inspection or other appropriate means. Additionally, the FDA’s clinical trial requirements, including sufficient size of patient populations and statistical powering, must be met. Many foreign regulatory authorities have similar approval requirements. In addition, such foreign trials would be subject to the applicable local laws of the foreign jurisdictions where the trials are conducted. There can be no assurance that the FDA or any comparable foreign regulatory authority will accept data from trials conducted outside of the United States or the applicable jurisdiction. Most of our clinical trials involve study subjects outside of the United States, including most of our phasePhase 1 clinical trials (which often enroll study subjects in Australia and New Zealand), and our Phase 3 clinical trials of plozasiran,plozasiran and zodasiran, for which we have enrolled (with respect to FCS and sHTG) and plan to enroll (with respect to ASCVD) cohorts outside the United States. If the FDA or any comparable foreign regulatory authority does not accept such data, it would result in the need for additional trials, which would be costly and time-consuming and delay aspects of our business plan, and which may result in product candidates that we may develop not receiving approval or clearance for commercialization in the applicable jurisdiction.

In order to market any products outside of the United States, we must establish and comply with numerous and varying regulatory requirements of other countries regarding safety and effectiveness.effectiveness, and the chemistry, manufacturing and controls for the product. Clinical trials conducted in one country may not be accepted by regulatory authorities in other countries, and regulatory approval in one country does not mean that regulatory approval will be obtained in any other country. Approval processes and requirements vary among countries and can involve additional product testing and validation and additional or different administrative review periods from those in the United States, including additional preclinical studies or clinical trials. In many jurisdictions outside the United States, a product candidate must be approved for reimbursement before it can be approved for sale in that jurisdiction. In some cases, the price that we intend to charge for our products is also subject to approval before a product can be marketed in that jurisdiction, even after establishing safety and efficacy in a clinical setting.

Even if our product candidates are approved for commercialization, failureFailure to comply with regulatory requirements or unanticipated problems with our products may result in various adverse actions such as the suspension or withdrawal of one or more of our products, closure of a facility or enforcement of substantial penalties or fines.

If regulatory approval to sell any of our product candidates is received, regulatoryRegulatory agencies will subject any marketed product(s), such as REDEMPLO, and the facilities where they are manufactured to continual review and periodic inspection. If previously unknown problems with a product, manufacturing and laboratory facilities or regulatory requirements are discovered, such as adverse eventsAEs of unanticipated severity or frequency, problems with a manufacturing process or laboratory facility, or failure to comply with applicable regulatory approval requirements, a regulatory agency may impose restrictions or penalties on that product or on us. Such restrictions or penalties may include, among other things:

Any marketing activities associated with ourREDEMPLO, or any other product candidates, ifcandidates approved for commercialization, will be subject to numerous federal and state laws governing the marketing and promotion of pharmaceutical and biological products. The FDA regulates post-approval promotional labeling and advertising to ensure that they conform to statutory and regulatory requirements. In addition to FDA restrictions, the marketing of prescription drugs is subject to laws and regulations prohibiting fraud and abuse under government healthcare programs. Similarly, many states have similar statutes or regulations that apply to items and services reimbursed under Medicaid and other state programs, and, in some states, such statutes or regulations apply regardless of the payor.payer. In addition, government authorities may also seek to hold us responsible for any failure of our commercialization or collaborative partners to comply with applicable statutes or regulations. If we, or our commercial or collaborative partners, fail to comply with applicable FDA regulations or other laws or regulations relating to the marketing of ourREDEMPLO, or any other approved product candidates, if approved for commercialization, we could be subject to criminal prosecution, civil penalties, seizure of products, injunctions and exclusion of our product candidates from reimbursement under government programs, as well as other regulatory or investigatory actions against our future product candidates, our commercial or collaborative partners or us. See also “Our operations, including our relationships with healthcare providers, physicians and third-party payers, are subject to applicable anti-kickback, fraud and abuse, and other healthcare laws and regulations, which, in the event of a violation, exposes us to liability for criminal sanctions, civil penalties, and contractual damages, and reputational harm and diminished profits and future earnings.”

We have licensed rights to patents and have filed and expect to continue to file patent applications. Researchers sponsored by us may also file patent applications that we may need to license. Such patent applications may not be available for licensing or may not be economically feasible to license. Certain of our patents may not be granted or may not contain claims of the necessary breadth because, for example, prior patents or publications exist. If a particular patent is not granted, the value of the invention described in the patent would be diminished. Further, even if these patents are granted, they may be difficult to enforce. Patent prosecution and maintenance is expensive, and we may be forced to curtail prosecution or maintenance if our cash resources are limited. Thus, the patents held by or licensed to us may not afford us any meaningful competitive advantage. Even if ultimately successful,successful in obtaining patent protection, efforts to enforce our patent rights could be expensive, distracting for management, cause our patents to be invalidated or held unenforceable, and thus frustrate commercialization of products. Even if patents are issued and are enforceable, others may develop similar, superior or parallel technologies to any technology developed by us and not infringe on our patents. OurAdditionally, our technology may be accused of infringing and may ultimately prove to infringe upon patents or rights owned by others. PatentThe prosecution and maintenance is expensive, and weCompany may be forcedsubject to curtailintellectual prosecutionproperty orlitigation maintenancethat could negatively impact our ability to commercialize REDEMPLO and our product candidates, if ourapproved. cashFor resourcesexample, areon limited.September Thus,10, 2025, the patentsCompany heldfiled a Complaint for Declaratory Judgment in the United States District Court for the District of Delaware against Ionis Pharmaceuticals, Inc. (“Ionis”) to declare that the United States Patent No. 9,593,333 (“the ’333 patent”) is invalid and not infringed by orthe licensedCompany’s toplanned uscommercialization mayof notinvestigational affordplozasiran, usand anyon meaningfulSeptember competitive11, advantage.2025, Ionis filed a Complaint for Patent Infringement against the Company in the United States District Court for the Central District of California alleging patent infringement of the ’333 patent. In addition, the laws of some foreign countries in which we do business, including through our joint ventures, do not protect intellectual property rights to the same extent or in the same manner as the laws of the United States. Moreover, if we or our licensors fail to maintain the patents and patent applications covering our product candidates or technologies, including as a result of geopolitical events such as civil or political unrest (including the ongoing conflicts between Ukraine and Russia and Israel and Palestine), we may not be able to use such patents and patent applications or stop a competitor from marketing products that are the same as or similar to our product candidates. As a result, we may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad. If we are unable to adequately protect our owned intellectual property or derive sufficient value from our licensed or owned intellectual property, the value of your investment may decline.

We may be and have been subject to patent infringement claims, which could result in substantial costs and liability and prevent us from commercializing our potential products.

Because the intellectual property landscape in the fields in which we participate is rapidly evolving and interdisciplinary, it is difficult to conclusively assess our freedom to operate without infringing on third-party rights. However, if granted marketing approval, we are currently aware of certain patent rights held by third parties that, if found to be valid and enforceable, could be alleged to render one or more of our drug products or candidates infringing. IfFor example, as the Company previously reported in Form 8-K filed on September 12, 2025, Ionis Pharmaceuticals, Inc. (“Ionis”) filed a complaint for patent infringement against the Company in the United States District Court for the Central District of California alleging patent infringement of United States Patent No. 9,593,333 (“the ’333 patent”) (the "Ionis Claim"), which may impact our planned commercialization of REDEMPLO. See also “Our ability to protect our patents and other proprietary rights is uncertain, exposing us to the possible loss of competitive advantage.” If the Ionis Claim or any potential future claim shouldby beanother brought andparty is successful, we may be required to pay substantial damages, be forced to abandon any affected drug product and/or product candidates and/or seek a license from the patent holder. In addition, the Ionis Claim and any future patent infringement claims brought against us, whether or not successful, may cause us to incur significant expenses and divert the attention of our management and key personnel from other business concerns. These could negatively affect our results of operations and prospects. We cannot be certain that patents owned or licensed by us will not be challenged, potentially successfully, by others.

In addition, if our products and/or product candidates are found to infringe the intellectual property rights of third parties, these third parties may assert infringement claims against our customers, licensees and other parties with whom we have business relationships, and we may be required to indemnify those parties for any damages they suffer as a result of these claims. The claims may require us to initiate or defend protracted and costly litigation on behalf of customers, licensees, and other parties regardless of the merits of these claims. If any of these claims succeed, we may be forced to pay damages on behalf of those parties or may be required to obtain licenses for the products they use. If we cannot obtain all necessary licenses on commercially reasonable terms, we may be unable to continue selling such products.

The Company develops medicines that treat intractable diseases by silencing the genes that cause them. Using a broad portfolio of RNA chemistries and efficient modes of delivery, the Company’s therapies trigger the RNAi interference mechanism to induce rapid, deep and durable knockdown of target genes. RNAi is a mechanism present in living cells that inhibits the expression of a specific gene, thereby affecting the production of a specific protein. RNAi-based therapeutics may leverage this natural pathway of gene silencing to target and shut down specific disease-causing genes.

The Company believes that TRiMTMTRiM enabled therapeutics offer several potential advantages over prior generationgenerations and competing technologies, including: simplified manufacturing and reduced costs; multiple routes of administration including subcutaneous injection and inhaled administration; the ability to target multiple tissue types including liver, lung, skeletal muscle, central nervous system (CNS), muscle,adipose tissue, ocular, and adipose tissuecardio-myocytes; and the potential for improved safety and reduced risk of intracellular buildup, because there are fewer metabolites from smaller, simpler molecules.

•Severe Hypertriglyceridemia - plozasiran (formerly ARO-APOC3ARO-APOC3, Greater China rights out-licensed to Sanofi);

•DyslipidemiaHomozygous familial hypercholesterolemia (HoFH) - zodasiran (formerly ARO-ANG3);

•Cardiovascular disease - olpasiran (formerly AMG 890 or ARO-LPA, out-licensed to Amgen);

•Muco-obstructive or inflammatoryInflammatory pulmonary conditions - ARO-MUC5AC and ARO-RAGE;

•Idiopathic pulmonary fibrosis - ARO-MMP7SRP-1002 (formerly ARO-MMP7, out-licensed to Sarepta);

•Metabolic-dysfunction associated steatohepatitis (MASH) - GSK-4532990GSK4532990 (formerly ARO-HSD, out licensed to GSK and Visirna);

•Alpha-1 antitrypsin deficiency (AATD) - fazirsiran (formerly ARO-AAT, a collaboration with Takeda);

•Chronic hepatitisHepatitis B virus - daplusiran/tomligisiran - GSK5637608 (GSK5637608, formerly JNJ-3989,JNJ-3989 and ARO-HBV, out-licensed to GSK);

•Complement mediated diseases - ARO-C3 and ARO-CFB;

•Obesity - ARO-INHBE; and ARO-ALK7

•Spinocerebellar ataxia 2 - ARO-ATXN2SRP-1004 (formerly ARO-ATXN2, out-licensed to Sarepta).

The Company continues to develop other clinical candidates for future clinical trials. Clinical candidates are tested internally and through Good Laboratory Practice (GLP) toxicology studies at outside laboratories. Drug materials for such studies and clinical trials are either manufactured internally or contracted to third-party manufacturers. The Company engages third-party contract research organizations (CROs) to manage clinical trials and works cooperatively with such organizations on all aspects of clinical trial management, including plan design, patient recruiting, and follow up. These outside costs, including toxicology/efficacy testing and manufacturing costs, as well as the preparation for and administration of clinical trials, are referred to as “candidate costs.” As clinical candidates progress through clinical development, candidate costs will increase.

During fiscal year 2024,2025 and through the date of filing, the Company continued to develop and advance its pipeline and partnered candidates and expand its facilities to support its growing programs. The bullets below highlight some of these key developments; however, this list is not all-inclusive and is meant to be read in conjunction with the entirety of management’s discussion and analysis, the Company’s Consolidated Financial Statements and notes thereto, and all other items contained within this Annual Report on Form 10-K.

•AmgenGSK completeddosed enrollmentits fifth patient in Amgen’sa Phase 3 OCEAN(a) - outcomes2 trial ofin olpasiran,December 2024, triggering a $50.0$2.5 million milestone payment to the Company from Royalty Pharma, which was paid in the thirdsecond quarter of fiscal 20242025;

Revenue Recognition—The Company has adopted Financial Accounting Standards Board (“FASB”) Topic 606 – Revenue for Contracts from Customers. The Company has not yet achieved commercial sales of its drug candidates to date,date; however, this standard is applicable to its licensing and collaboration agreements. This is discussed further in Note 2, Collaboration and License Agreements of the Notes to the Company’s Consolidated Financial Statements in Part IV, “Item 15. Exhibits and Financial Statement Schedules.”

Typically, the Company’s collaboration agreements entitle it to additional payments upon the achievement of milestones or royalties on sales. The milestones are generally categorized into three types: development milestones, generally based on the initiation of toxicity studies or clinical trials; regulatory milestones, generally based on the submission, filing or approval of regulatory applications such as a NDA in the United States; and sales-based milestones, generally based on meeting specific thresholds of sales in certain geographic areas. The Company evaluates whether it is probable that the consideration associated with each milestone or royalty will not be subject to a significant reversal in the cumulative amount of revenue recognized. Amounts that meet this threshold are included in the transaction price using the most-likely-amount method, whereas amounts that do not meet this threshold are excluded from the transaction price until they meet this threshold. At the end of each subsequent reporting period, the Company re-evaluates the probability of a significant reversal of the cumulative revenue recognized for its milestones and royalties, 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 revenues and net income in the Company’s consolidated statements of operations and comprehensive loss.income (loss). Typically, milestone payments and royalties are achieved after the Company’s performance obligations associated with the collaboration agreements have been completed and after the customer has assumed responsibility for the respective clinical or preclinical program. Milestones or royalties achieved after the Company’s performance obligations have been completed are recognized as revenue in the period the milestone or royalty was achieved. If a milestone payment is achieved during the performance period, the milestone payment would be recognized as revenue to the extent performance had been completed at that point, and the remaining balance would be recorded as deferred revenue.

The revenue standard requires the Company to allocate the arrangement consideration on a relative standalone selling price basis for each performance obligation after determining the transaction price of the contract and identifying the performance obligations to which that amount should be allocated. The relative standalone selling price is defined in the revenue standard as the price at which an entity would sell a promised good or service separately to a customer. If other observable transactions in which the Company has sold the same performance obligation separately are not available, the Company estimates the standalone selling price of each performance obligation. KeyThe assumptionsestimates toincludes determineforecasted revenues and expenses, phase dates, probability of success, development timelines, and the standalonediscount rate. The estimates of the stand-alone selling price mayfor research and development or other service-related performance obligations generally include forecastedforecasting revenues,the developmentexpected timelines, reimbursement rates for personnel costs, discount rates and probabilitiescosts of technicalsatisfying anda regulatoryperformance success.obligation at market rates.

Clinical Accruals—The Company accrues liabilities for products received or services incurred, particularly for ongoing clinical trials, where service providers have not yet billed or where billing terms do not align with the timing of the work performed as of the period-end. These costs mainly include third-party clinical management or clinical research organization (CRO), laboratory analysis, and investigator fees. Accrual estimates may be based on vendor communications to obtain pending invoices and/or estimates for services performed during the period. In some cases, these estimates require significant judgment, drawing on an understanding of research and development programs, services provided during the period, prior experience, and, where applicable, the expected duration of third-party contracts. Actual costs upon settlement may differ significantly from the accrued amounts in the Company’s consolidated financial statements, though historical estimates have not differed materially from actual costs.

This Quarterly Report on Form 10-Q contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and we intend that such forward-looking statements be subject to the safe harbors created thereby. For this purpose, any statements contained in this Quarterly Report on Form 10-Q except for historical information may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as “may,” “might,” “will,” “expect,” “believe,” “anticipate,” “goal,” “endeavor,” “strive,” “intend,” “plan,” “project,” “could,” “estimate,” “target,” “might,” “forecast,” “potential,” or “continue” or the negative of these words or other variations thereof or comparable terminology are intended to identify forward-looking statements. In addition, any statements that refer to projections of our future financial performance, trends in our business, or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements include, but are not limited to, statements about the initiation, timing, progress and results of our preclinical studies and clinical trials, and our research and development programs; our expectations regarding the timing and potential benefits of the partnership, licensing and/or collaboration arrangements and other strategic arrangements and transactions we have entered into or may enter into in the futurefuture, including our pending acquisition of a rare pediatric disease priority review voucher; our beliefs and expectations regarding the amount and timing of future milestone, royalty or other payments that could be due to or from third parties under existing agreements; and our estimates regarding future revenues, sales of REDEMPLO (plozasiran), our expectations regarding regulatory approval for and commercial launch of plozasiran, operating income, research and development expenses, cash flows, capital requirements and payments to third parties.

The Company develops medicines that treat intractable diseases by silencing the genes that cause them. Using a broad portfolio of RNA chemistries and modes of delivery, the Company’s therapies trigger the RNAiRNA interference mechanism to induce rapid, deep and durable knockdown of target genes. RNAi is a mechanism present in living cells that inhibits the expression of a specific gene, thereby affecting the production of a specific protein. RNAi-based therapeutics seek to leverage this natural pathway of gene silencing to target and shut down specific disease-causing genes.

•REDEMPLO® (Greater China rights out-licensed to Sanofi), indicated as an adjunct to diet to reduce triglycerides in adults with Familial Chylomicronemia Syndrome (FCS), which has received regulatory approvals in the United States, European Union, Canada, Australia and China.China (Greater China rights out-licensed to Sanofi).

The following table presents selected programs from the Company’s current pipeline:

The First HalfThree QuarterQuarters of Fiscal 2026 Business Highlights

The bullets below highlight key developments in our business during the first halfthree quarters of fiscal year 2026:

•Announced interim results from two Phase 1/2a clinical trials of ARO-INHBE and ARO-ALK7, the Company’s investigational RNAi therapeutics being developed as potential treatments for obesity,obesity and metabolic dysfunction-associated steatohepatitis (MASH), showing for patients enrolled in the study that:

The bullets below highlight other key developments in our business subsequent to the secondthird quarter of fiscal year 2026:

Total revenue for the three and sixnine months ended MarchJune 31,30, 2026 increased by $47.5 million and decreased by $469.0 million and $207.4$160.0 million, respectively, fromas compared to the same periods of 2025. The change was primarily driven by lower Sarepta revenue, partially offset by increased revenue fromrecognition Novartisassociated with the Sarepta, Novartis, Madrigal and Sanofi, reflecting the timing and progress of the Company’s respectiveSanofi collaboration and license agreements.agreements, and partially driven by commercial revenue from REDEMPLO.

Sarepta: On November 25, 2024, the Company entered into the Sarepta Collaboration Agreement and Stock Purchase Agreement with Sarepta for the development and commercialization of multiple clinical and preclinical programs in rare, genetic diseases of the muscle, central nervous system, and lungs. On December 16, 2025, the Company entered into the Sarepta Clinical Supply Agreement, whereby the Company is responsible for manufacturing and supplying certain materials to Sarepta for specified activities. During the sixthree and nine months ended MarchJune 31,30, 2026, the Company recorded $271.2$26.4 million and $297.6 million in revenue.revenue associated with these Sarepta agreements, respectively.

Novartis: On August 29, 2025, the Company entered into the Novartis Collaboration Agreement with Novartis for the development and commercialization of multiple preclinical programs in rare, genetic diseases of the central nervous system. During the sixthree and nine months ended MarchJune 31,30, 2026, the Company recorded $54.7$20.2 million and $74.9 million in revenue.revenue associated with this transaction, respectively.

Visirna and Sanofi: On August 1, 2025, Visirna HK, a wholly owned subsidiary of Visirna Therapeutics, Inc, a majority owned subsidiary of the Company, entered into an Asset Purchase Agreement with Sanofi, pursuant to which Visirna HK sold all of its assets and rights in investigational plozasiran to Sanofi, which included an assignment of Visirna HK’s rights (as successor by assignment from Visirna) to develop and commercialize investigational plozasiran in Greater China pursuant to that certain License Agreement by and between the Company and Visirna dated, April 25, 2022 (the “Visirna License Agreement”). During the sixthree and nine months ended MarchJune 31,30, 2026, the Company recorded $10.7$1.2 million and $12.0 million in revenue associated with this transaction.transaction, respectively.

The analysis below details the operating expenses and discusses the expenditures of the Company within the major expense categories. For purposes of comparison, the amounts for the three and sixnine months ended MarchJune 31,30, 2026 and 2025 are shown in the tables below.

Candidate costs increased $28.3$31.6 million, or 40%,33%, for the three months ended MarchJune 31,30, 2026 and $56.4$87.9 million, or 38%,36%, for the sixnine months ended MarchJune 31,30, 2026 compared to the same periods of 2025. The increase was primarily due to the additional progression of the Company’s pipeline of candidates into and through clinical trials, which resulted in higher outsourced clinical trial costs, manufacturing,costs and toxicity studymanufacturing costs.

Discovery costs increaseddecreased $3.7$2.7 million, or 25%,13%, for the three months ended MarchJune 31, 2026 and $12.6 million, or 45%, for the six months ended March 31,30, 2026 compared to the same periodsperiod of 2025, primarily driven by highertiming of R&D discovery activity associated with ongoing discovery efforts. Discovery costs increased $9.9 million, or 20%, for the nine months ended June 30, 2026 compared to the same period of 2025, primarily driven by increased R&D discovery activity associated with ongoing discovery efforts and expansion into novel therapeutic areas and tissue types, partially offset by lower partnership cost.types.

Salaries consist of salary, bonuses, payroll taxes, and related benefits for the Company’s R&D personnel. Salaries expense increased $6.6$5.4 million, or 25%,21%, for the three months ended MarchJune 31,30, 2026 and $9.5$15.0 million, or 18%,19%, for the sixnine months ended MarchJune 31,30, 2026 compared to the same periods of 2025. The increase was primarily due to an increase in headcount that has occurred as the Company has expanded its pipeline of candidates and worked to prepare for the manufacture of commercial material at the Verona facility, as well as annual salary increases.

Facilities-related expense includes lease costs for the Company’s research and development facilities in San Diego, California and in Madison, Wisconsin. These expenses increased $0.9$0.6 million, or 13%,9%, for the three months ended MarchJune 31,30, 2026 and $1.2$1.8 million or 8%, for the sixnine months ended MarchJune 31,30, 2026 compared to the same period of 2025. ThisThe increase was primarily due to expenses, such as utilities andutilities, repair and maintenance charges, associated with the expanded manufacturing facilities in Verona, Wisconsin to support manufacturing operations.

Stock compensation expense, a non-cash expense, is primarily based on the valuation of restricted stock units granted to employees, which is based on the closing stock price on the grant date. Stock compensation expense increased $0.4$0.5 million, or 5%,7%, for the three months ended MarchJune 31,30, 2026 compared to the same period of 2025, primarily driven by the annual issuance of RSU grants to employees in January 2026. Stock compensation expense decreased $0.8$0.2 million, or 5%1% for the sixnine months ended MarchJune 31,30, 2026 compared to the same period of 2025, primarily driven by stock options award expense incurred in the second fiscal quarter 2025 related to Visirna, our variable interest entity, that did not repeat in the second fiscal quarter 2026.

Depreciation and amortization expense, a non-cash expense, relates to depreciation on buildings, lab equipment and leasehold improvements. These expenses increased $0.3$0.4 million, or 5%,8%, for the three months ended MarchJune 31,30, 2026 and $1.5$1.9 million, or 14%12%, for the sixnine months ended MarchJune 31,30, 2026 compared to the same periods of 2025. The increase was primarily attributable to the transfer of additional manufacturing equipment following the completion of certification, qualification and validation to support manufacturing operations.

Salaries expense increased $4.6$6.1 million, or 58%,77%, for the three months ended MarchJune 31,30, 2026 and $9.2$15.3 million, or 60%66% for the sixnine months ended MarchJune 31,30, 2026 compared to the same periods of 2025. The increase was driven by higher headcount required to support the Company’s growthcommercialization asof the Company prepared for commercialization,REDEMPLO, as well as of annual salary increases.

Professional, outside services, and other expenses include costs related to commercial activities, legal, consulting, patent filings, business insurance, other external services, as well as travel, communication, and technology expenses. These expenses increased $8.1$8.4 million, or 75%,57%, for the three months ended MarchJune 31,30, 2026 and $16.9$25.3 million, or 81%71%, for the sixnine months ended MarchJune 31,30, 2026 compared to the same periods of 2025. The increase was mainly due to commercialization expense associated with the Company;sCompany’s launch of REDEMPLO, including costs for marketing and commercial launch support.

Facilities related expense primarily includes rental costs and other facilities-related costs for the Company’s corporate headquarters in Pasadena, California. These expenses increased $0.4 million, or 38%,17%, for the three months ended MarchJune 31,30, 2026 and $0.8$1.2 million, or 33%26%, for the sixnine months ended MarchJune 31,30, 2026 compared to the same periods of 2025. The increase was primarily driven by higher staff amenities expenses driven by higher headcount.

Stock compensation expense, a non-cash expense, is based on the valuation of restricted stock units granted to employees, which is based on the closing stock price on the grant date. These expenses increased $0.2$1.3 million, or 3%,24%, for the three months ended MarchJune 31,30, 2026 and $5.6$6.9 million, or 35%32%, for the sixnine months ended MarchJune 31,30, 2026 compared to the same periods of 2025. The increase was primarily due to recognition of compensation expense related to a performance-based restricted stock unit award following the achievement of a pre-specified performance milestone.milestone, as well as new grants issued to new employees.

Other income (expense) is primarily related to interest income and expense, loss on equity method investment in Bisirna, and to gain on VIE'SVIE’s sale of IPR&D assets. Other incomeexpense increaseddecreased $15.3$4.7 million and $16.4$21.2 million for the three and sixnine months ended MarchJune 31,30, 20262026, respectively, compared to the same periods of 2025. The increasedecrease for the nine months ended June 30, 2026 was primarily due to a gain on VIE'SVIE’s sale of IPR&D assets related to the transfer of research and development assets from Visirna to Bisirna in January 2026.2026, as well as an increased interest income on the Company’s available-for-sale securities. The decrease for the three months ended June 30, 2026 was primarily due to increased interest income on the Company's available-for-sale securities.

On January 15, 2026, Visirna closed on an Asset Transfer Agreement with Bisirna to sell and transfer certain assets and rights associated with R&D technology. The purchase price was $19.0 million, payable as (i) $9.0 million in paid-in-full warrants (exercise price of $0.18 per share) issued by Bisirna at the closing of the asset transfer, and (ii) $10.0 million of Bisirna Series A preferred shares, which were issued upon the closing of Bisirna’s Series A equity financing on January 15, 2026. As the performance obligation associated with the asset transfer was fully satisfied at closing, the Company recognized $19.0 million of gain in other income forduring the second fiscal quarter ended March 31,of 2026.

Net loss attributable to Arrowhead Pharmaceuticals, Inc. was $132.7$194.3 million and $101.9$296.2 million for the three and sixnine months ended MarchJune 31,30, 2026, respectively, compared to a net loss attributable to Arrowhead Pharmaceuticals, Inc. of $175.2 million and a net income attributable to Arrowhead Pharmaceuticals, Inc. of $370.4 million and $197.4$22.1 million for the three and sixnine months ended MarchJune 31,30, 2025.2025, respectively. Net loss per diluted share was $0.93$1.36 and $0.73$2.10 for the three and sixnine months ended MarchJune 31,30, 2026, respectively, compared to a net loss per diluted share of $1.26 and a net income per diluted share of $2.75 and $1.52$0.17 for the three and sixnine months ended MarchJune 31,30, 2025.2025, respectively. The increase in net loss attributable to Arrowhead Pharmaceuticals, Inc. and decrease in net income attributable to Arrowhead Pharmaceuticals, Inc. for the three and sixnine months ended MarchJune 31,30, 2026 compared to the same periods of 20252025, respectively, was primarily due to a decrease in revenue from the Sarepta Collaboration Agreement, combined with higher commercial costs as well as research and development expenses, associated with the expansion of the Company'sCompany’s pipeline and progression through clinical trial phases.

The Company’s cash, cash equivalents and restricted cash was $188.5$54.8 million as of MarchJune 31,30, 2026 compared to $226.5 million as of September 30, 2025. Cash invested in available-for-sale securities was $1,595.6$1,547.2 million as of MarchJune 31,30, 2026 compared to $692.8 million as of September 30, 2025.

On November 25, 2024, the Company entered into a licensing and collaboration agreement with Sarepta. Upon closing, the Company received $325.0 million for the purchase of 11,926,301 shares of common stock, at a price per share of $27.25, and received $500.0 million as an upfront payment on February 24, 2025. During the fourth quarter of fiscal 2025, a $100.0 million milestone payment from Sarepta was triggered, when the Company reached the first of two prespecified enrollment targets and subsequent authorization to dose escalate in a Phase 1/2 clinical study of ARO-DM1, an investigational RNAi therapeutic for the treatment of type 1 myotonic dystrophy (DM1). The Company received $53.2 million of Arrowhead common stock and $50.0 million cash from Sarepta to satisfy the milestone payment. During the second quarter of fiscal 2026, the Company received $200.0 million of the second DM1 milestone payment and a $50.0 million payment for the first installment of the annual fee. The Company is eligible to receive the second installment of the annual fee of up to $50.0 million over the 12 months from MarchJune 31,30, 2026, On August 29, 2025, the Company entered into a licensing and collaboration agreement with Novartis. Upon closing in October 2025, the Company received $200.0 million as an upfront payment.2026.

On December 10, 2025, the Company entered into the Amended and Restated Sale Agreement with Jefferies LLC, acting as sales agent and/or principal, which amended and restated the Company’s prior open market sale agreement in its entirety. Pursuant to the Amended and Restated Sale Agreement, the Company may, from time to time, sell shares of the Company’s common stock through Jefferies LLC in an at-the-market offering, up to the maximum program amount permitted under the Company’s effective shelf registration statement. As of MarchJune 31,30, 2026, the Company had sold approximately 689,0001,056,000 shares of common stock under the Amended and Restated Sale Agreement, generating gross proceeds of $48.2$76.1 million and net proceeds of $46.8$74.1 million, after deducting commissions and offering costs.

During the sixnine months ended MarchJune 31,30, 2026, cash flow providedused byin operating activities was $97.9$79.5 million, which was primarily due to increase in ongoing expenses related to the Company’s research and development programs and selling, general and administrative expenses, partially offset by $200.0 million of cash received as part of the Novartis agreement, $200.0 million of the second DM1 milestone payment and apayment, $50.0 million payment for the first installment of the annual fee received as part of the Sarepta agreement, partiallyand offset$25.0 bymillion increaseof incash ongoingreceived expensesas relatedpart toof the Company'sMadrigal research and development programs and selling, general and administrative expenses.agreement. Cash used in investing activities amounted to $918.0$874.3 million, which was primarily attributable to investment purchases of $1,061.6$1,138.7 million, and capital expenditures of $4.7$8.6 million, partially offset by proceeds from maturities of investments of $124.5$224.2 million and proceeds from sales of investments of $23.7$48.8 million. Cash provided by financing activities of $781.0$780.5 million was primarily due to $681.3 million net proceeds from the issuance of convertible note, $116.6 million in net proceeds from a follow-on common stock offering, $46.8$74.1 million in net proceeds from the issuance of common stock under the Company's at-the-market equity offering program, $100.0 million proceeds from issuance of pre-funded warrants and $10.1$12.8 million proceeds from the exercise of stock options, partially offset by partial repayment of the credit facility (inclusive of $84.5MOIC Payments) of $117.9 million, purchase of the Capped Calls of $47.9 million, and dividends paid to noncontrolling shareholders of $41.5$38.4 million (See Note 6 — Stockholders’ Equity of Notes to Consolidated Financial Statements of Part I, “Item 1. Financial Statements”).

During the sixnine months ended MarchJune 31,30, 2025, cash flow provided by operating activities was $313.8$159.1 million, which was primarily due to $500.0 million of cash received as part of the Sarepta agreement, partially offset by ongoing expenses related to the Company's research and development programs and selling, general and administrative expenses. Cash used in investing activities was $343.3$201.9 million, which was primarily attributable to capital expenditures of $12.8$15.2 million and investment purchases of $677.9$774.6 million, partially offset by proceeds from sales and maturities of investments of $347.4$587.9 million. Cash provided by financing activities of $113.0$70.3 million was primarily related to cash received from the issuance of common stock as well as stock option exercises.

The Company entered into a global licensing and collaboration agreement with NovartisMadrigal on AugustMay 29,4, 2025,2026, which closed on OctoberJune 17,2, 20252026 (see Note 2). The Company entered into a Pasadena Lease Amendment for its office lease located in Pasadena, California on April 27, 2026 (see Note 9). There has been no other material change during the three months ended June 30, 2026 in the Company’s contractual obligations from that described in Item 7 of its Annual Report on Form 10-K for the fiscal year ended September 30, 2025.