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•We depend heavily on the ability to successfully advance seralutinib through clinical development.development successfully.

•Our business may be adversely affected by difficulties or delays in enrolling patients in our current or plannedfuture clinical trials or the commencement or completion, or termination or suspension, of our current or plannedfuture clinical trials.

Biopharmaceutical product development is a highly speculative undertaking and involves a substantial degree of risk. We are a clinical-stage biopharmaceutical company with a relatively limited operating history upon which you can evaluate our business and prospects. We commenced operations in 2017, and to date, we have focused primarily on organizing and staffing our company, business planning, raising capital, identifying, acquiring and in-licensing product candidates and conducting preclinical studies and clinical trials. Seralutinib is in active clinical development. We have not yet demonstrated an ability to successfully complete any clinical trials beyond Phase 2, obtain regulatory approvals, manufacture a commercial scale product, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful product commercialization. Consequently, any predictions made about our future success or viability may not be as accurate as they could be if we had a history of successfully developing and commercializing biopharmaceutical products.

We have incurred significant operating losses since our inception. If seralutinib is not successfully developed and approved, we may never generate any revenue. Our net losses were $56.5$170.4 million and $179.8$56.5 million for the years ended December 31, 20242025 and 2023,2024, respectively. As of December 31, 2024,2025, we had an accumulated deficit of $1,268.6$1,438.9 million. Substantially all of our losses have resulted from expenses incurred in connection with our research and development programs and from general and administrative costs associated with our operations. Seralutinib will require substantial additional development time and resourcesresources, and may require additional development, before we would be able to apply for or receive regulatory approvals and begin generating revenue from product sales.sales, if ever. We expect to continue to incur losses for the foreseeable future, and we anticipate these losses will increase substantiallyfuture as we continue our development of, seek regulatory approval for and potentially commercialize seralutinib and seek to identify, assess, acquire, in-license or develop additional product candidates.

The development of biopharmaceutical product candidates is capital-intensive. We expect our expenses to remain high in connection with our ongoing activities, particularly as we conduct our ongoing and plannedfuture clinical trials of seralutinib, continue research and development, and seek regulatory approval for seralutinib. In addition, as seralutinib progresses through development and toward commercialization, we will need to make milestone payments to Pulmokine from whom we have in-licensed seralutinib. Furthermore, if and to the extent we seek to acquire or in-license additional product candidates in the future, we may be required to make significant upfront payments, milestone payments, and/or licensing payments. If we obtain regulatory approval for seralutinib, we also expect to incur significant commercialization expenses related to product manufacturing, marketing, sales and distribution. Because the outcome of any clinical trial or preclinical study is highly uncertain, we cannot reasonably estimate the actual amounts necessary to successfully complete the development and commercialization of seralutinib. Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations. If we are unable to raise capital when needed or on attractive terms, we could be forced to delay, reduce or eliminate our research and development programs or any future commercialization efforts.

We believe that our existing cash, cash equivalents and marketable securities will enable us to fund our operations for at leastinto the nextfirst 12quarter monthsof from the date this annual report is filed with the SEC.2027. In particular, we expect that these funds will allow us to completemeet ourwith registrationalthe PhaseFDA 3to clinicaldiscuss triala potential path forward for seralutinib in PAH forand, seralutinib.subject to those discussions, to file an NDA with the FDA, although we will be required to raise additional capital to support any additional development required by the FDA prior to any NDA submission. We have based these estimates on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect. Our operating plans and other demands on our cash resources may change as a result of many factors currently unknown to us, and we may need to seek additional funds sooner than planned, through public or private equity or debt financings or other capital sources, including potentially collaborations, licenses and other similar arrangements. In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. Attempting to secure additional financing may divert our management from our day-to-day activities, which may adversely affect our ability to develop seralutinib.

•the type, number, scope, progress, expansions, results, costs and timing of, our clinical trials and preclinical studies of seralutinib or product candidates we may choose to pursue in the future or that may be required by regulatory agencies;

•diluting the interests of our existing stockholders as a result of issuing shares of our common stock upon conversion of the notes; and

Our business may not generate sufficient funds, and we may otherwise be unable to maintain sufficient cash reserves, to pay amounts due under our indebtedness, including the notes, and our cash needs may increase in the future. In addition, any future indebtedness that we may incur may contain, financial and other restrictive covenants that limit our ability to operate our business, raise capital or make payments under our other indebtedness. If we fail to comply with these covenants or to make payments under our indebtedness when due, then we would be in default under that indebtedness, which could, in turn, result in that and our other indebtedness becoming immediately payable in full.

We depend entirely on the success of seralutinib, which is currently in Phase 3 clinical development. If we are unable to advance seralutinib in clinical development, obtain regulatory approval and ultimately commercialize seralutinib, or experience significant delays in doing so, our business will be materially harmed. In addition, we intend to continue advancing RT234 pursuant to our option agreement with Respira Therapeutics. We may not have sufficient capital or other resources to continue such program, and even if we do, any development efforts may not be successful or warrant continued development.

Our only product candidate is currently in Phase 3 clinical development. We are conducting an open-label extension of our Phase 2 clinical trial of seralutinib in PAHPAH, which commenced in 2020, and wean commencedopen-label aextension registrationalof our Phase 3 clinical trial of seralutinib in PAHPAH, which commenced in the2025. fourthIn quarterFebruary 2026, we also announced that we paused enrollment of 2023. We expect to activate clinical sites for a global registrationalour Phase 3 forclinical the treatmenttrial of PH-ILDseralutinib in thePH-ILD. secondIn halfaddition, ofwe 2025.intend to continue advancing RT234 pursuant to our option agreement with Respira Therapeutics.

Our assumptions about why seralutinib is worthy of future development and potential approval in PAH, or any additional indications including PH-ILD, are based in part on data collected by other companies. Our ability to generate product revenues, which we do not expect will occur for many years, if ever, will depend heavily on the successful development and eventual commercialization of seralutinib. The success of seralutinib or RT234, if we exercise our option to acquire Respira Therapeutics, will depend on several factors, including the following:

Seralutinib is subject to regulation as a combination product, which means that it is composed of both a drug product and device product. If marketed individually, each component would be subject to different regulatory pathways and reviewed by different centers within the FDA. Seralutinib, will therefore require review and coordination by FDA’s drug and device centers prior to approval, which may delay approval. Under FDA regulations, combination products are subject to current good manufacturing practice, or cGMP, requirements applicable to both drugs and devices, including the Quality Management System regulation currently applicable to medical devices in the United States. The EU regulates medical devices and medicinal products separately, through different legislative instruments, and the applicable requirements will vary depending on the type of drug-device combination product. Problems associated with the device component of seralutinib may delay or prevent approval. If the manufacturer of the device products make modifications, or if we elect to change a device component or develop our own proprietary device component, we will need to perform validation testing and obtain FDA and other regulatory authorization or certification prior to using the modified device component. If the FDA, any other regulatory authority or notified body fails to authorize or certify use of those modified devices in combination with seralutinib or take significant enforcement action against the manufacturer of the device component, we would not be able to market or may have to suspend marketing seralutinib in certain jurisdictions.

The success of our business, including our ability to finance our company and generate any revenue in the future, will primarily depend on the successful development, regulatory approval and commercialization of seralutinib, which may never occur. We have not yet succeeded and may not succeed in demonstrating efficacy and safety for seralutinib in clinical trials to the satisfaction of FDA or inother obtainingregulatory marketing approval thereafter.authorities. Given our current stage of development,development and the results of our PROSERA Phase 3 clinical trial of seralutinib in PAH, it may be several years, if at all, before we have demonstrated the safety and efficacy of a treatment sufficient to warrant approval for commercialization. If we are unable to develop, or obtain regulatory approval for, or, if approved, successfully commercialize seralutinib, we may not be able to generate sufficient revenue to continue our business.

Clinical drug development involves a lengthy and expensive process with an uncertain outcome, and the results of preclinical studies and early clinical trials are not necessarily predictive of future results. In addition, some of our assumptions about why seralutinib is worthy of future development and potential approval are based on data collected by other companies. Seralutinib may not have favorable results in its Phase 3 clinical trial in PAH or the anticipated Phase 3 clinical trial in PH-ILD, or receive regulatory approval on a timely basis, if at all.

The results from preclinical studies or clinical trials of seralutinib or a competitor’s product candidate in the same class may not predict the results of later clinical trials of seralutinib, and interim, topline or preliminary results of a clinical trial are not necessarily indicative of final results. Product candidates in later stages of clinical trials may fail to show the desired safety and efficacy characteristics despite having progressed through preclinical studies and initial clinical trials. It is not uncommon to observe results in clinical trials that are unexpected based on preclinical studies and early clinical trials, and many product candidates fail in clinical trials despite very promising early results. For example, our decision to advance seralutinib as a potential treatment for PAH is based in partFebruary on2026, we announced that the efficacy of imatinib (Gleevec), a tyrosine kinase inhibitor with known activity against PDGF and marketed for oncology indications, observed by Novartis in a Phase 3 clinical trial; however, we may not observe similar efficacy in our Phase 3PROSERA clinical trial ofdid seralutinib.not meet its primary endpoint . Moreover, these and any future preclinical and clinical data may be susceptible to varying interpretations and analyses. A number of companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in clinical development even after achieving promising results in earlier studies.

For the foregoing reasons, we cannot be certain that our ongoing and plannedfuture clinical trials and preclinical studies will be successful. Any safety concerns observed in any one of our clinical trials in our targeted indications could limit the prospects for regulatory approval of seralutinib in PAH and other indications that we may pursue in the future, including PH-ILD, which could have a material adverse effect on our business, financial condition and results of operations.

Any difficulties or delays in the commencement or completion, or termination or suspension, of our current or plannedfuture clinical trials could result in increased costs to us, delay or limit our ability to generate revenue and adversely affect our commercial prospects.

Before obtaining marketing approval from regulatory authorities for the sale of seralutinib, we must conduct extensive clinical studies to demonstrate the safety and efficacy of seralutinib in humans. For example, we are currently conducting a registrational Phase 3 clinical trial of seralutinib in PAH patients. In addition, before we can initiate clinical development for our product candidates, and in some cases, before we can pursue clinical development of a product candidate for a new potential indication, we must submit the results of preclinical studies to the FDA along with other information, including information about product candidate chemistry, manufacturing and controls and our proposed clinical trial protocol, as part of an IND, and we are also required to submit regulatory filings to foreign regulatory authorities for clinical trials outside of the United States.

We do not know whether our ongoing or plannedfuture trials will begin on time or be completed on schedule, if at all. The commencement, data readouts and completion of clinical trials can be delayed for a number of reasons including delays related to:

•the FDA or comparable foreign regulatory authorities disagreeing as to the design or implementation of our clinical studies, including the doses and endpoints of our ongoing andor plannedpotential future Phase 3 clinical trial of seralutinib;

Such delays or regulatory feedback on our trial designs could also significantly increase the costs of our clinical trials, including ourany Phase 3future clinical trialtrials of seralutinib. We could also encounter delays if a clinical trial is suspended or terminated by us, by the IRBs of the institutions in which such trials are being conducted, by a Data Safety Monitoring Board for such trial or by the FDA or comparable foreign regulatory authorities. Such authorities may impose such a suspension or termination due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection of the clinical trial operations or trial site by the FDA or comparable foreign regulatory authorities resulting in the imposition of a clinical hold, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a drug, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial. In addition, changes in regulatory requirements and policies may occur, and we may need to amend clinical trial protocols to comply with these changes. Amendments may require us to resubmit our clinical trial protocols to IRBs or ethics committees for reexamination, which may impact the costs, timing or successful completion of a clinical trial.

It is currently unclear to what extent UK will seek to align its regulations with the EU. The UK regulatory framework in relation to clinical trials is derived from the now-repealed EU Clinical Trials Directive (as implemented into UK law, through the Medicines for Human Use (Clinical Trials) Regulations 2004, as amended). TheIn extentApril to which the regulation of clinical trials in the UK will mirror the (EU) CTR in the long term is not yet certain, however, on December 12, 2024,2025, the UK government introduced a legislative proposal - the Medicines for Human Use (Clinical Trials) Amendment Regulations 20242024. -The that,amendment, if implemented,which will replacetake thefull currenteffect regulatoryfrom frameworkApril for clinical trials in the UK. The legislative proposal2026, aims to provide a more flexible regime to make it easier to conduct clinical trials in the UK, increase the transparency of clinical trials conducted in the UK and make clinical trials more patient centered. The UK government has provided the legislative proposal to the UK Parliament for its review and approval. Once the legislative proposal is approved (with or without amendment), it will be adopted into UK law which is expected in early 2026. Under the terms of the Protocol on Ireland/Northern Ireland, provisions of the (EU) CTR which relate to the manufacture and import of investigational medicinal products and auxiliary medicinal products apply in Northern Ireland. A decision by the UK government not to closely align its regulations with the new approach that has been adopted in the EU may have an effect on the cost of conducting clinical trials in the UK as opposed to other countries. Clinical trial submissions in the UK will not be able to be bundled with those of EU member states within the EMA CTIS, adding further complexity, cost and potential risk to future clinical and development activity in the UK.

Further, conducting clinical trials in foreign countries, as we currently and may continue to do for seralutinib, presents additional risks that may delay completion of our clinical trials. These risks include the failure of enrolled patients in foreign countries to adhere to clinical protocol as a result of differences in healthcare services or cultural customs, managing additional administrative burdens associated with foreign regulatory schemes, as well as political and economic risks, including war, relevant to such foreign countries. For example, we are currently conducting ourthe registrationalopen label Phase 3 study of seralutinib in PAH at sites outside the United States.

We may not be able to initiate or continue clinical trials for seralutinib if we are unable to identify and enroll a sufficient number of eligible patients to participate in these trials as may be required by the FDA or similar regulatory authorities outside the United States. Subject enrollment, a significant factor in the timing of clinical trials, is affected by many factors including the size and nature of the patient population, the proximity of patients to clinical sites, the eligibility and exclusion criteria for the trial, the design of the clinical trial, the risk that enrolled patients will not complete a clinical trial, our ability to recruit clinical trial investigators and associated staff with the appropriate competencies and experience, competing clinical trials and clinicians’ and patients’ perceptions as to the potential advantages and risks of the product candidate being studied in relation to other available therapies, including any new drugs that may be approved for the indications we are investigating as well as any drugs under development. We will be required to identify and enroll a sufficient number of subjects for each of our clinical trials. Potential subjects for any plannedfuture clinical trials may not be adequately diagnosed or identified with the diseases which we are targeting or may not meet the entry criteria for such trials. For example, a limited number of patients are affected by PAH and other indications includingthat we may pursue such as PH-ILD, which are our target indication for seralutinib, and we have encountered difficulties enrolling patients in our previous clinical trials of seralutinib in PAH patients. We also may encounter difficulties in identifying and enrolling subjects with a stage of disease appropriate for ourany Phasefuture 3 trialtrials of seralutinib and monitoring such subjects adequately during and after treatment. We may not be able to initiate or continue clinical trials if we are unable to locate a sufficient number of eligible subjects to participate in the clinical trials required by the FDA or comparable foreign regulatory authorities. In addition, the process of finding and diagnosing subjects may prove costly.

The timing of our clinical trials depends, in part, on the speed at which we can recruit patients to participate in our trials, as well as completion of required follow-up periods. The eligibility criteria of our clinical trials, once established, will further limit the pool of available trial participants. For example, PAH is a rare disease with limited patient pools from which to draw for our registrational Phase 3 trial.draw. If patients are unwilling to participate in our trials for any reason, including the existence of concurrent clinical trials for similar patient populations in PAH, if they are unwilling to enroll in a clinical trial with a placebo-controlled design or the availability of approved therapies, or we otherwise have difficulty enrolling a sufficient number of patients, the timeline for recruiting subjects, conducting studies and obtaining regulatory approval of seralutinib may be delayed. Our inability to enroll a sufficient number of subjects for our Phase 3 trial of seralutinib or any of our future clinical trials would result in significant delays or may require us to abandon one or more clinical trials altogether. In addition, we expect to rely on CROs and clinical trial sites to ensure proper and timely conduct of our future clinical trials and, while we intend to enter into agreements governing their services, we will have limited influence over their actual performance.

As is the case with pharmaceuticals generally, it is likely that there may be side effects and adverse events associated with seralutinib’s use. Results of our clinical trials could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics. Undesirable side effects caused by seralutinib could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay or denial of regulatory approval by the FDA or comparable foreign regulatory authorities. For example, basedtransaminase uponelevations of three times or greater of the benefitupper /limit riskof profilenormal were observed in 13% of patients receiving seralutinib, as compared to 1% of patients receiving placebo in our PROSERA Phase 3 clinical trial, and inalthough responsewe believe PAH clinicians are well-accustomed to seriousadministering and monitoring therapies with potential hepatic effects, such adverse events observed,could weadversely decided to terminateaffect the Phasedevelopment 1b/2of studyseralutinib or otherwise impair any commercialization efforts for GB5121.seralutinib, if approved. Drug-related side effects could affect patient recruitment or the ability of enrolled patients to complete the trial or result in potential product liability claims. Any of these occurrences may harm our business, financial condition and prospects significantly.

Moreover, if seralutinib is associated with undesirable side effects in clinical trials or have characteristics that are unexpected, we may elect to abandon its development or limit its development to more narrow uses or subpopulations in which the undesirable side effects or other characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective, which may limit the commercial expectations for seralutinib if approved. We may also be required to modify our study plans based on findings in our ongoing clinical trials. For example, although we believe seralutinib has been generally well tolerated in completed clinical trials, futurewith clinicalcough, trials,headache includingand transaminase elevations being the most common treatment emergent adverse effects in our PROSERA Phase 3 trialclinical oftrial, seralutinibfuture inclinical PAH patientstrials may reveal adverse events inconsistent with the safety findings observed to date. For example, in 2013, results from a Phase 3 clinical trial in PAH of imatinib (Gleevec) showed statistically significant improvement in its primary efficacy endpoint, but systemic toxicities were also observed. Although we have not observed the systemic toxicities associated with imatinib, we cannot be certain that seralutinib will not exhibit similar or other toxicities in athe largerfuture Phaseas 3the clinicaluse trial.of seralutinib becomes more widespread if it receives regulatory approval. Many compounds that initially showed promise in early-stage testing have later been found to cause side effects that prevented further development of the compound. In addition, regulatory authorities may draw different conclusions or require additional testing to confirm these determinations.

It is possible that as we test seralutinib in ourfuture Phaseclinical 3 trial in PAH,trials, or as the use of seralutinib becomes more widespread if it receives regulatory approval, illnesses, injuries, discomforts and other adverse events that were observed in earlier trials, as well as conditions that did not occur or went undetected in previous trials, will be reported by subjects. If such side effects become known later in development or upon approval, if any, such findings may harm our business, financial condition and prospects significantly.

Although we have completed Phase 2 and 3 clinical trials for multiple product candidates including seralutinib, we have not, as an organization, completed later-stage clinical trials or submitted an NDA, and we may be unable to do so for seralutinib.

We will need to successfully complete a pivotal clinical trial in order to obtain FDA or comparable foreign regulatory approval to market seralutinib. Carrying out later-stage clinical trials and the submission of a successful NDA or other comparable foreign regulatory submission is a complicated process. As an organization, we have completed four Phase 2 clinical trials, including a Phase 2 clinical trial of seralutinib, and are conducting a Phase 3 clinical trial of seralutinib in PAH. We have not yet completed any pivotal clinical trials for seralutinib or previous product candidates. We also have limited experience as a company in preparing, submitting marketing applications and have not previously submitted an NDA or other comparable foreign application for any product candidate. WeWhile our primary focus is on seeking approval from the FDA for seralutinib in PAH, we may also conduct a number of clinical trials for seralutinib in parallel over the next several years, which may be a difficult process to manage with our limited resources and which may divert the attention of management. In addition, we have had limited interactions with the FDA and cannot be certain our data from our Phase 2 and Phase 3 clinical trialtrials of seralutinib will be sufficient to support an NDA submission,submission in PAH, even if we believe the results are sufficiently positive.positive to support a regulatory approval. Consequently, we may be unable to successfully and efficiently execute and complete necessary clinical trials in a way that leads to regulatory submission and approval of seralutinib. We may require more time and incur greater costs than our competitors and may not succeed in obtaining regulatory approvals of seralutinib. Failure to commence or complete, or delays in, our planned clinical trials, could prevent us from or delay us in submitting NDAs or other comparable foreign regulatory submissions for and commercializing seralutinib.

Prior to obtaining approval to commercialize seralutinib in the United States or abroad, we must demonstrate with substantial evidence from adequate and well-controlled clinical trials, and to the satisfaction of the FDA or comparable foreign regulatory authorities, that seralutinib is safe and effective for its intended uses. Results from nonclinical studies and clinical trials can be interpreted in different ways. Even if we believe the nonclinical or clinical data for seralutinib are promising, such data may not be sufficient to support approval by the FDA and comparable foreign regulatory authorities. For example, we recently reported that the PROSERA Phase 3 did not meet its prespecified primary endpoint, and though we plan to discuss these results with the FDA to determine the appropriate path forward, there is no guarantee that the results from the PROSERA Phase 3 will be sufficient to support the submission of an NDA. The FDA or comparable foreign regulatory authorities, as the case may be, may also require us to conduct additional preclinical studies or clinical trials for seralutinib either prior to or post-approval, or may object to elements of our clinical development program.

Regulatory authorities in some jurisdictions, including the United States and the EU, may designate drugs for relatively small patient populations as orphan drugs. Under the Orphan Drug Act of 1983, the FDA may designate a product as an orphan product if it is intended to treat a rare disease or condition, which is generally defined as a patient population of fewer than 200,000 individuals in the United States, or a patient population of greater than 200,000 individuals in the United States, but for which there is no reasonable expectation that the cost of developing the drug will be recovered from sales in the United States. In the EU, the EC grants orphan designation based on the EMA’s Committee for Orphan Medicinal Products’ opinion to promote the development of products (1) that are intended for the diagnosis, prevention or treatment that is life-threatening or chronically debilitating, and (2) either (a) such condition affects no more than five in 10,000 persons in the EU when the application is made, or (b) the product, without the benefits derived from orphan status, would be unlikely to generate sufficient returns in the EU to justify the necessary investment, and (3) there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the EU, or, if such a method exists, the medicine must be of significant benefit to those affected by the condition. We have received orphan drug designation in the United States andStates, the EU and Japan for seralutinib for treatment of PAH and may seek additional orphan designations for seralutinib in the future. There can be no assurance that we will be able to maintain or obtain such designations.

In the United States, orphan designation entitles a party to financial incentives such as opportunities for grant funding toward clinical trial costs, tax advantages and user-fee waivers. In addition, if a product candidate that has orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any other applications, including an NDA, to market the same drug for the same indication or use within the relevant disease or condition for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity within the relevant indication or use or where the manufacturer is unable to assure sufficient product quantity.quantity to meet the needs relating to the indication or use protected by orphan exclusivity. Upon grant of a marketing authorization in the EU, orphan medicinal products are entitled to ten years of market exclusivity, during which time no similar medicinal product for the same indication may be placed on the market. This period may be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the orphan designation criteria, including where it is shown that the product is sufficiently profitable not to justify maintenance of market exclusivity or where the prevalence of the condition has increased above the threshold.

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.indications or uses. Even after an orphan drug is approved, the FDA or comparable foreign regulatory authority can subsequently approve the same drug for the same conditionindication or use if such regulatory authority concludes that the later drug is clinically superior if it is shown to be safer, more effective or makes a major contribution to patient care.care with respect to the indication or use covered by orphan exclusivity. 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.

From time to time, we may publicly disclose preliminary or topline or data from our clinical studies, such as the recent announcement of our PROSERA Phase 3 topline results, which is based on a preliminary analysis of then-available 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 preliminary or 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 and preliminary 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 and preliminary data should be viewed with caution until the final data are available. From time to time, we may also disclose interim data from our clinical studies. Interim data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available. Adverse differences between topline, preliminary or interim data and final data could significantly harm our business prospects.

Disruptions at the FDA and other government agencies caused by funding shortages, staffing limitations or globalpolicy health concernschanges could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, cleared or approved or commercialized in a timely manner or at all, which could negatively impact our business.

The ability of the FDA and foreign regulatory authorities to review and clear or approve new products can be affected by a variety of factors, including government budget and funding levels, statutory, regulatory, and policy changes, the FDA’s or foreign regulatory authorities’ ability to hire and retain key personnel and accept the payment of user fees, and other events that may otherwise affect the FDA’s ability to perform routine functions. Average review times at the FDA and foreign regulatory authorities have fluctuated in recent years as a result. In addition, government funding of other government agencies that fund research and development activities is subject to the political process, which is inherently fluid and unpredictable. Disruptions at the FDA and other agencies may also slow the time necessary for new drugs or modifications to approved drugs and biologics to be reviewed and/or approved by necessary government agencies, which would adversely affect our business. For example, in recent years, the U.S. government has shut down several times and certain regulatory agencies, such as the FDA, have had to furlough critical FDA employees and stop critical activities. In addition, the current U.S. Presidential administration has issued certain policies and Executive Orders directed towards reducing the employee headcount and costs associated with U.S. administrative agencies, including the FDA, which have led to substantial personnel changes, and it remains unclear the degree to which these efforts may limit or otherwise adversely affect the FDA’s ability to conduct routine activities. If a prolonged government shutdown occurs, or if funding shortages, staffing limitations or similar factors hinder or prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, such events could significantly impact the ability of the FDA or other such regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Any future pandemic or epidemic disease outbreaks, and any supply chain disruptions or staffing shortages, could disrupt the manufacture or shipment of supplies of seralutinib for use in our research and clinical trials, delay, limit or prevent our employees and CROs from continuing or timely advancing research and development activities, impede our clinical trial initiation and recruitment and the ability of subjects to continue in clinical trials, impact the results of the clinical trial based on participants contracting the disease or otherwise increasing the number of observed adverse events, impede testing, monitoring, data collection and analysis and other related activities, any of which could delay our clinical trials and increase our development costs, and have a material adverse effect on our business, financial condition and results of operations. Any future pandemic or future epidemic disease outbreaks could also potentially further affect the business of the FDA or other regulatory authorities, which could result in delays in meetings related to plannedfuture clinical trials or other regulatory matters.

The FDA’s and other regulatory authorities’ policies may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of seralutinib. For instance, the EU pharmaceutical legislation is currently undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020. The European Commission’s proposal for revision of several legislative instruments related to medicinal products (potentially reducing the duration of regulatory data protection, revising the eligibility for expedited pathways, etc.) was published on April 26, 2023. The proposed revisionschanges remainwere tosince be agreeddiscussed and adoptednegotiated by the European Parliament and Europeanthe Council andof the proposalsEU mayas thereforepart of the EU ordinary legislative process. A provisional agreement has been reached by the European Parliament and Council of the EU on the proposed revisions on December 11, 2025. The proposed revisions (affecting the duration of regulatory data protection and market protection, including for orphan medicinal products, revising the eligibility for expedited pathways, etc.) remain to be substantiallyformally revisedadopted beforeby adoption,the two institutions, which is not anticipated before early 2026. The revisionsproposed changes are not expected to enter into application before 2028 and may however have a significant impact on the biopharmaceutical industry in the long term. We also cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative or executive action, either in the United States or abroad. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may be subject to enforcement action, and we may not achieve or sustain profitability.

Third-party payors increasingly are challenging prices charged for pharmaceutical products and services, and many third-party payors may refuse to provide coverage and reimbursement for particular drugs when an equivalent generic drug or a less expensive therapy is available. It is possible that a third-party payor may consider seralutinib as substitutable and only offer to reimburse patients for the less expensive product. Even if we are successful in demonstrating improved efficacy or improved convenience of administration with seralutinib, pricing of existing drugs may limit the amount we will be able to charge for seralutinib. These payors may deny or revoke the reimbursement status of seralutinib or establish prices for new or existing marketed products at levels that are too low to enable us to realize an appropriate return on our investment in product development.investment. If reimbursement is not available or is available only at limited levels, we may not be able to successfully commercialize seralutinib and may not be able to obtain a satisfactory financial return on seralutinib.

We expect to face competition for seralutinib and RT234 from existing products and products in development. Seralutinib is a PDGFR, CSF1R and c-KIT inhibitor initially targeted for PAH and PH-ILD patients. We expect competition within the PAH indication will include prostanoids / prostacyclin receptor agonists, including Orenitram (United Therapeutics), Uptravi (Janssen), Tyvaso (United Therapeutics), Yutrepia (Liquidia) and Remodulin (United Therapeutics), and activin ligand traps, including Winrevair (Merck). We also may face some competition from products used inas Functionalfrontline Classtherapy Ifor and II patients,PAH, such as the oral PDE5 inhibitors, including Revatio (Pfizer Inc.) and Adcirca (United Therapeutics); the sGC stimulator Adempas (Bayer AG); and oral ERAs, including Tracleer (Janssen), Letairis (Gilead Sciences, Inc.) and Opsumit (Janssen); and combination PDE5 inhibitor / ERA therapies, such as Opsynvi (Janssen). We believe that, if approved, seralutinib could be used alongside all classes of approved therapies. PAH is also an active indication for investigational drugs, and we may face competition in the future from L606 (Liquidia / Pharmosa Biopharma Inc.), CS1 (Cereno Scientific), L606 (Liquidia / Pharmosa Biopharm Inc.), treprostinil palmitil inhalation powder (InsmedInsmed, Inc.), ralinepag (United Therapeutics), and REGN13335 (Regeneron), Pharmaceuticals,HS235 (35Pharma, Inc.), LTP001 (Novartis), APL‑9796 (Apollo Therapeutics Ltd), and ROC‑101 (AllRock Bio, Inc.). Additionally, although not approved for the treatment of PAH, we may face competition from formulations of imatinib, including the one in development from Tenax Therapeutics and Inhibikase Therapeutics. While there are multiple classes of therapies with marketing approval for PAH, there are currently no therapies approved for PRN use to provide rapid, on‑demand symptom relief.

We expect to face competition from Tyvaso (United Therapeutics) and Yutrepia (Liquidia) within the PH-ILD indication, as itthey isare the only approved therapytherapies for PH-ILD in the United States. There are no approved therapies for PH-ILD in the EU. PH-ILD is also an active indication for investigational drugs, and we may face competition in the future from L606 (Liquidia / Pharmosa BiopharmBiopharma Inc.), sirolimus (OrphAI Therapeutics), treprostinil palmitil inhalation powder (Insmed, Inc.), MK-5475 (Merck), and mosliciguat (Pulmovant, Inc.), mirivadelgat (ForeSee Pharmaceuticals Co., Ltd.), APL‑9796 (Apollo Therapeutics Ltd), and ROC‑101 (AllRock Bio, Inc.). While there is one class of therapy with marketing approval for PH-ILD, there are currently no therapies approved for PRN use to provide rapid, on‑demand symptom relief.

We are a clinical-stageclinical-stage, clinical biopharmaceutical company focused on the development and commercialization of seralutinib for the treatment of PH, including PAH and PH-ILD. Our goal is to be an industry leader in, and to enhance the lives of patients living with PH. In May 2024, we entered into the collaborationChiesi agreementCollaboration forAgreement seralutinibfocused withon Chiesi.the development and commercialization of seralutinib. In December 2022, we announced positive topline results from the Phase 2 TORREY Study in PAH patients. In theFebruary fourth quarter of 2023,2026, we initiatedannounced topline results from the registrational Phase 3 PROSERA Study in PAH.PAH patients. Seralutinib demonstrated a placebo-adjusted improvement in the primary endpoint, 6MWD at Week 24, of 13.3 meters (p = 0.0320), missing the prespecified alpha threshold of 0.025. We expectbelieve seralutinib demonstrates a risk benefit profile that supports continued regulatory dialogue, and we plan to reportengage toplinewith datathe fromFDA, including through requesting a Type C meeting, to understand their perspective on the totality of the PROSERA studyand inTORREY thedatasets fourthand quarterpotential ofregulatory 2025.paths forward. In addition to PAH, we believe that seralutinib holds potential as a therapeutic for the treatment of PH-ILD. WeIn expectOctober to2025, activatewe activated the first clinical sitessite for athe global registrational Phase 3 SERANATA Study for the treatment of PH-ILDPH-ILD. Enrollment in the secondSERANATA halfStudy was paused in February 2026 to support disciplined resource allocation and to evaluate the implications of 2025.PROSERA as we engage with regulators. We have assembled a deeply experienced and highly skilled group of industry veterans, scientists, clinicians and key opinion leaders from leading biotechnology and pharmaceutical companies, as well as leading academic centers from around the world. Our employees are a team of highly dedicated, passionate individuals who pride themselves on a culture of respect, humility, transparency, inclusion, dedication, collaboration and fun. Our ultimate goal is to enhance and extend the lives of patients.

We were incorporated in October 2015 and commenced operations in 2017. To date, we have focused primarily on organizing and staffing our company, business planning, raising capital, identifying, acquiring and in-licensing our product candidates and conducting preclinical studies and clinical trials. We have funded our operations primarily through equity financings and the collaborationChiesi agreement.Collaboration Agreement. We raised $1,401.1$1,396.9 million from October 2017 through December 31, 20242025 through the sale of Series A and Series B convertible preferred stock, issuance of convertible notes, proceeds from our IPO,IPO completed in February 2019, proceeds from the 2027 Notes (as defined below), issuanceissuances of common stock in May 2020 and July 2022, issuance of common stock and accompanying warrants in July 2023 and entry into the collaborationChiesi agreementCollaboration Agreement in May 2024. As of December 31, 2024,2025, we had $294.5$136.9 million in cash, cash equivalents and marketable securities.

We have incurred significant operating losses since our inception and expect to continue to incur significant operating losses for the foreseeable future. For the years ended December 31, 20242025 and 2023,2024, our net loss was $56.5$170.4 million and $179.8$56.5 million, respectively. As of December 31, 2024,2025, we had an accumulated deficit of $1,268.6$1,438.9 million. We expect to incur expenses and operating losses for the foreseeable future as we continue our development of and seek regulatory approvals for seralutinib, including the conduct of ongoing and plannedfuture clinical trials and other research and development activities; and as we hire additional personnel, protect our intellectual property and incur additional costs associated with being a public company. In addition, as seralutinib progresses through development and toward commercialization, we will need to make milestone payments to Pulmokine from whom we have in-licensed seralutinib. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending in particular on the timing of our clinical trials and preclinical studies and our expenditures on other research and development activities.

On May 3, 2024, we announced a strategic global partnership with Chiesi. Under the terms of the collaborationChiesi agreement,Collaboration Agreement, we granted Chiesi exclusive licenses for the worldwide development, manufacture and commercialization of seralutinib and licensed products and an Equity Option to purchase our common stock.stock, which expired in November 2025 and is no longer exercisable. The total potential transaction value includes the one-time $160.0 million development cost reimbursement payment for licenses, research and development funding, and certain regulatory and commercial milestones. We and Chiesi share equally in the costs of ongoing global seralutinib clinical development and the costs of commercialization in the UnitedU.S. States,Territory, with the exception of the PROSERA Phase 3 study, for which we bear all costs. We are also eligible for double-digit royalties in the mid-to-high teens percentage on tiers of annual net sales outside of the U.S. Territory and to an equal share of profits and losses from the commercialization of seralutinib and licensed products in the U.S. . For additional information regarding the collaboration agreement, as well as our license agreement with Pulmokine, see the section titled “Business—License and Collaboration Agreements” in this annual report.

We do not expect to generate any revenue from product sales unless and until we successfully complete development and obtain regulatory approval for seralutinib, which we expect will take a number of years.years, if at all. If we obtain regulatory approval for seralutinib, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution. Accordingly, until such time as we can generate substantial product revenues to support our cost structure, if ever, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, including potentially collaborations, licenses and other similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. Our failure to raise capital or enter into such other arrangements when needed could have a negative impact on our financial condition and on our ability to pursue our business plans and strategies. If we are unable to raise additional capital when needed, we could be forced to delay, limit, reduce or terminate seralutinib development or future commercialization efforts or grant additional rights to develop and market seralutinib even if we would otherwise prefer to retain such right.

To date, we have generated all of our revenue from ourthe collaborationChiesi agreementCollaboration with Chiesi.Agreement. Our revenue consists of a one-time development cost reimbursement payment for licenses and ongoing cost-sharing payments for performance of research and development services classified as revenue from contracts with collaborators.

In the future, we may generate revenue from a combination of license fees and other upfront payments, other funded research and development agreements, milestone payments, product sales, other third-party funding, USU.S. profit/loss share and royalties in connection with strategic alliances. We expect that any revenue we generate will fluctuate from quarter-to-quarter as a result of the timing of performance of research and development services, the timing of our achievement of regulatory and commercialization milestones, the timing and amount of payments relating to such milestones and the extent to which any of our products are approved and successfully commercialized. If we are unable to fund our development costs or we are unable to develop product candidates in a timely manner or obtain regulatory approval for them, our ability to generate future revenues and our results of operations and financial position would be adversely affected.

Our direct research and development expenses consist principally of external costs, such as fees paid to CROs, investigative sites and consultants in connection with our clinical trials, preclinical and non-clinical studies, and costs related to manufacturing clinical trial materials. We deploy our personnel and facility related resources across all of our research and development activities. We track external costs and personnel expense on a program-by-program basis and allocate common expenses, such as facility related resources, to each program based on the personnel resources allocated to such program. Stock-based compensation and personnel and common expenses not attributable to a specific program are considered unallocated research and development expenses. We categorize Terminated Programs as any research and development expenses attributable to our clinical stage product candidates that were terminated prior to December 31, 2023.2023 or any research and development expenses that are not directly allocated to seralutinib.

•the costs incurred as a result of health epidemics and pandemics, including the COVID-19 pandemic,pandemics and clinical site staff shortages, including clinical trial delays;

In process research and development, or IPR&D, expenses include IPR&D acquired as part of an asset acquisition or in-licensein-license, for which there is no alternative future use, and the value of the right to acquire Respira Therapeutics via a merger, or the Respira Merger Option, with Prana Bio, the 100% owner of Respira Therapeutics, and are expensed as incurred.

General and administrative expenses consist primarily of salaries and employee-related costs, including stock-based compensation, for personnel in executive, finance and other administrative functions. Other significant costs include facility-related costs, legal fees relating to intellectual property and corporate matters, professional fees for accounting and consulting servicesservices, insurance costs and insurancecommercial costs.planning expenses. Subject to obtaining clarity on potential regulatory paths forward, we anticipate that our general and administrative expenses may increase in the future to support our continued research and development and commercial planning activities and, if seralutinib receives marketing approval, commercialization activities.

We expect to incur general and administrative expenses for the foreseeable future to support our current infrastructure and continued costs of operating as a public company. These expenses will likely include audit, legal, regulatory, and tax-related services associated with maintaining compliance with exchange listing and SEC requirements, director and officer insurance premiums, as well as commercial preparedness, corporate strategy, business development, corporate communications and investor relations costs associated with operating as a public company.

For the year ended December 31, 2024, our revenue was $114.7 million. Our revenue is generated from our ongoing collaboration with Chiesi and consists of a one-time development cost reimbursement payment for the licenses and ongoing cost-sharing payments for performance of research and development and pre-commercial services. Revenue was $48.5 million for the year ended December 31, 2025, compared to $114.7 million for the year ended December 31, 2024, for a decrease of $66.2 million, which was primarily attributable to a decrease of $90.7 million from sale of licenses, offset by an increase of $24.5 million of revenue associated with performance of research and development and pre-commercial services.

There were no IPR&D expenses for the year ended December 31, 2024. IPR&D expenses for the year ended December 31, 20232025 were $10.0$7.5 million, which was attributable to a milestone obligation incurred upon the initiationacquisition of theRespira PhaseMerger 3 clinical trial of seralutinib in the fourth quarter of 2023 and paid to Pulmokine in 2024.Option.

General and administrative expenses were $37.6 million for the year ended December 31, 2025, compared to $36.1 million for the year ended December 31, 2024, compared to $38.5 million for thean year ended December 31, 2023, for a decreaseincrease of $2.3$1.5 million, which was primarily attributable to a $2.2$6.3 million increase in commercial planning expense and a $1.2 million increase in personnel expense, offset by a $5.1 million decrease in stock-based compensation expense,expense and a decrease of $0.8$1.1 million in legalfacilities expense, a decrease of $0.6 million in insurance costs, offset by an increase of $0.6 million in professional services expense and an increase of $0.4 million in travel costs.expense.

Other income, net was $0.3 million for the year ended December 31, 2025, compared to other income, net of $4.3 million for the year ended December 31, 2024, comparedfor toa other income, netdecrease of $3.9 million for the year ended December 31, 2023, for an increase of $0.3$4.0 million, which was primarily attributable to a $3.2$6.4 million increasedecrease in investment accretionaccretion, andoffset by a $2.0$0.5 million decrease in interest expense,expense offset byand a $3.6$1.1 million decreaseincrease in other income primarily related to $2.8$1.4 million of employee retention credit under the CARES Act and $1.0 million of Ireland Corporate R&D tax credit.Act.

Provision (benefit) for income taxes

There was $0.1 million tax benefit for the year ended December 31, 2025. For the year ended December 31, 2024, the tax expense was $0.9 million, which was primarily attributable to the treatment of the Chiesi income and a partial release of the valuation allowance. There was no provision for income taxes for the year ended December 31, 2023.

Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures, including commercial planning expenditures. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in our outstanding accounts payable and accrued expenses. We may also use cash on hand to repurchase 2027 Notes through open-market transactions, including through a Rule 10b5-1 trading plan to facilitate open-market repurchases, or otherwise, from time to time.

From our inception through the year ended December 31, 2024,2025, our operations have been financed primarily by proceeds of $1,401.1$1,396.9 million from the sale of Series A and Series B convertible preferred stock, proceeds from our IPO, proceeds from the 2027 Notes, proceeds from issuance of common stock in May 2020 and July 2022, proceeds from issuance of common stock and accompanying warrants in July 2023 and the collaborationChiesi agreementCollaboration withAgreement. Chiesi.In addition, we have received $36.4 million as of December 31, 2025 through reimbursement related to the Chiesi Collaboration Agreement. As of December 31, 2024,2025, we had cash, cash equivalents and marketable securities of $294.5$136.9 million. Cash in excess of immediate requirements is invested in accordance with our investment policy, primarily with a view to capital preservation and liquidity.

On May 3, 2024, we entered into the collaborationChiesi agreementCollaboration with Chiesi.Agreement. In consideration and as reimbursement for our development costs, Chiesi paid us an up-front, nonrefundable payment of $160.0 million. In addition, we and Chiesi share equally in the costs of ongoing global seralutinib clinical development, with the exception of the PROSERA Phase 3 study, and the costs of commercialization in the UnitedU.S. States.Territory. For the year ended on December 31, 2024,2025, we received cost-sharing payments from Chiesi in the amount of $7.8$28.6 million.

Additional information about our long-term borrowings is presented in Note 5 “Indebtedness” and operating leases is presented in Note 11 "Commitments and Contingencies" to the Notes to Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K, incorporated herein by this reference.

During the year ended December 31, 2024,2025, operating activities used approximately $3.5$171.3 million of cash, primarily resulting from a net loss of $56.5$170.4 million and changes in prepaid expenses and other current assets of $8.5 million and amortization of premium on investments, netinvestments of accretion of discount, of $13.1$7.3 million, reduced by changes in accrued research and development expenses of $11.2 million and stock-based compensation expense of $20.6 million and changes in contract liabilities of $55.9$10.6 million.

During the year ended December 31, 2022,2024, operating activities used approximately $187.0$3.5 million of cash, primarily resulting from a net loss of $229.4$56.5 million and payments against operating lease liabilitiesamortization of $2.7premium on investments, net of accretion of discount, of $13.1 million, partially reduced by stock-based compensation expense of $42.6$20.6 million and amortizationchanges in contract liabilities of operating lease right-of-use assets of $2.6$55.9 million.

During the year ended December 31, 2023, investing activities used approximately $111.0 million of cash, primarily resulting from the purchasespurchase of marketable securities of $441.7 million, offset by the maturities of marketable securities of $330.7 million.

Based on our current operating plan, we believe that our existing cash, cash equivalents and marketable securities, will be sufficient to fund our operations through at least the nextfourth 12quarter monthsof from the date these consolidated financial statements were available to be issued.2026. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we expect. Additionally, the process of testing seralutinib in clinical trials and seeking regulatory approval is costly, and the timing of progress and expenses in these trials is uncertain. Pending feedback from the FDA on a potential path forward for seralutinib, we also expect that the level of spending for our ongoing and planned commercial planning activities for seralutinib may increase.

There have been no material changes to the risk factors previously disclosed by us in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed with the SEC on March 17, 2026.2026, except as set forth below:

This quarterly report on Form 10-Q contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and Section 27A of the Securities Act of 1933, as amended, or the Securities Act. All statements other than statements of historical facts contained in this quarterly report, including statements regarding our future results of operations and financial position, including performance under the Chiesi Collaboration Agreement business strategies and plans, research and development plans, the anticipated timing, costs, design and conduct of our ongoing and planned preclinical studies and planned clinical trials for seralutinib, the timing and likelihood of regulatory filings and approvals for seralutinib, including the timing and potential submission, and potential acceptance for filing and approval, of an NDA for seralutinib in PAH, timing and likelihood of success, plans and objectives of management for future operations, the anticipated benefits of the termination of the Company’s Collaboration and License Agreement with Chiesi, the anticipated benefits of any reverse stock split, and the timing of the completion of any such reverse stock split, the potential impact of U.S. trade policy, including tariffs, and future results of seralutinib, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

We are a clinical-stage biopharmaceutical company focused on the development and commercialization of seralutinib for the treatment of PH, including PAH and PH-ILD. Our goal is to be an industry leader in, and to enhance the lives of patients living with PH. In MayJuly 2024,2026, we entered into the ChiesiRights CollaborationReacquisition Agreement focusedwith onChiesi, thepursuant to which we reacquired worldwide development and commercializationcommercial ofrights to seralutinib. In December 2022, we announced positive topline results from the Phase 2 TORREY Study in PAH patients. In February 2026, we announced topline results from the Phase 3 PROSERA Study in PAH patients. Seralutinib demonstrated a placebo-adjusted improvement in the primary endpoint, 6MWD at Week 24, of 13.3 meters (p = 0.0320), missing the prespecified alpha threshold of 0.025. We believe seralutinib demonstratesFollowing a riskPre-NDA benefitType profileB that supports continued regulatory dialogue. Subject to the outcomes of interactionsmeeting with the FDA,FDA held in mid-June 2026 and receipt of the Companyofficial expectsmeeting minutes, we plan to submitproceed awith Newan DrugNDA Application to the FDAsubmission for seralutinib for the treatment of PAH in September 2026. The Company intends to submit an NDA supported by one adequate and well-controlled study (Phase 3 PROSERA) plus confirmatory evidence (Phase 2 TORREY and supportive analyses). If the NDA is accepted for filing, seralutinib could be eligible for an FDA approval decision in the third quarter of 2027. In addition to PAH, we believe that seralutinib holds potential as a therapeutic for the treatment of PH-ILD, and this indication remains an area of focus for us. In October 2025, we activated the first clinical site for the global registrational Phase 3 SERANATA Study for the treatment of PH-ILD. Enrollment in the SERANATA Study was paused in February 2026 to support disciplined resource allocation and to evaluate the implications of PROSERA as we engage with regulators. However, we plan to re-continue PH-ILD development work when feasible based on such resource allocation decisions. We have assembled a deeply experienced and highly skilled group of industry veterans, scientists, clinicians and key opinion leaders from leading biotechnology and pharmaceutical companies, as well as leading academic centers from around the world. Our employees are a team of highly dedicated, passionate individuals who pride themselves on a culture of respect, humility, transparency, inclusion, dedication, collaboration and fun. Our ultimate goal is to enhance and extend the lives of patients.

We were incorporated in October 2015 and commenced operations in 2017. To date, we have focused primarily on organizing and staffing our company, business planning, raising capital, identifying, acquiring and in-licensing our product candidates and conducting preclinical studies and clinical trials. We have funded our operations primarily through equity and debt financings and the Chiesi Collaboration Agreement. As of MarchJune 31,30, 2026, we had $99.2$57.0 million in cash, cash equivalents and marketable securities.

We have incurred significant operating losses since our inception and expect to continue to incur significant operating losses for the foreseeable future. For the three months ended MarchJune 31,30, 2026 and 2025, our net gain was $16.9 million and net loss of $38.3 million, respectively. For the six months ended June 30, 2026 and 2025, our net loss was $46.7$29.8 million and $36.6$74.9 million, respectively. As of MarchJune 31,30, 2026, we had an accumulated deficit of $1,485.6$1,468.7 million. We expect to incur expenses and operating losses for the foreseeable future as we continue our development of and seek regulatory approvals for seralutinib, including the conduct of ongoing and planned clinical trials and other research and development activities; and as we hire additional personnel, protect our intellectual property and incur costs associated with being a public company. In addition, as seralutinib progresses through development and toward commercialization, we will need to make milestone payments to Pulmokine from whom we have in-licensed seralutinib. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending in particular on the timing of our clinical trials and preclinical studies and our expenditures on other research and development activities.

Our management’s discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make judgments and estimates that affect the reported amounts of assets, liabilities, revenue, expenses and the disclosure of contingent assets and liabilities in our condensed consolidated financial statements. We base our estimates on historical experience, known trends and events, and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. On an ongoing basis, we evaluate our judgments and estimates in light of changes in circumstances, facts and experience. During the threesix months ended MarchJune 31,30, 2026, there have been no significant changes in our critical accounting policies and estimates as discussed in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K filed with the SEC on March 17, 2026. See Note 2, Summary of Significant Accounting Policies, for information about these critical accounting policies.

Results of Operations – Comparison of the Three and Six Months Ended MarchJune 31,30, 2026 and 2025

The following table sets forth our selected statements of operations data for the three months ended MarchJune 31,30, 2026 and 2025 (in thousands):

Our revenue is generated from our ongoing collaboration with Chiesi and consists of ongoing research and development service performance and cost-sharing payments for performance of research and development and pre-commercial services. For the three months ended MarchJune 31,30, 2026 and 2025, our revenue was $17.0$9.2 million and $9.9$11.5 million, respectively, for a decrease of $2.3 million, which was primarily attributable to the decrease in research and development services and costs subject to reimbursement. For the six months ended June 30, 2026 and 2025, our revenue was $26.2 million and $21.4 million, respectively, for an increase of $7.1$4.8 million, which was primarily attributable to an increase in research and development and pre-commercial services.

Research and development expenses were $43.1$26.4 million for the three months ended MarchJune 31,30, 2026, compared to $38.0$41.6 million for the three months ended MarchJune 31,30, 2025, for ana increasedecrease of $5.0$15.2 million, which was primarily attributable to ana increasedecrease of $6.1$15.7 million of costs associated with clinical trials for seralutinibseralutinib, andoffset by an increase of $0.7$0.5 million of costs associated with Respira, offset by a decrease of $1.8 million of costs associated with preclinical studies and clinical trials for terminated programs.Respira.

The following table shows our research and development expenses by program for the three and six months ended MarchJune 31,30, 2026 and 2025:

General and administrative expenses were $18.7$8.9 million for the three months ended MarchJune 31,30, 2026, compared to $8.7 million for the three months ended MarchJune 31,30, 2025, for an increase of $10.1$0.2 million, which was primarily attributable to a $1.7$0.2 million increase in commerciallegal expenses,expense, a $4.6$0.6 million increase in stock-based compensation expense and a $0.4 million increase in personnel expense due to severance, offset by a $2.2$1.0 million increasedecrease in stock-basedcommercial compensation expense and a $1.2 million increase in professional services expense.costs.

Other loss,income, net was $1.8$43.0 million for the three months ended MarchJune 31,30, 2026, compared to the other income, net of $0.2$0.5 million for the three months ended MarchJune 31,30, 2025, for aan decreaseincrease of $2.0$42.5 million, which was primarily attributable to a $2.1$43.9 million gain on the debt extinguishment, $4.1 million gain on the derivative liability remeasurement and $1.6 million gain on the warrant liability remeasurement, offset by the $1.6 million decrease in investment accretion.accretion and $4.4 million issuance costs attributable to the embedded derivative and purchase warrants..

We have incurred substantial operating losses since our inception and expect to continue to incur significant operating losses for the foreseeable future and may never become profitable. As of MarchJune 31,30, 2026, we had an accumulated deficit of $1,485.6$1,468.7 million.

Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures, including commercial planning expenditures. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in our outstanding accounts payable and accrued expenses. We may also use cash on hand to repurchase 2027 Notes and 2030 Notes through open-market transactions, including through a Rule 10b5-1 trading plan to facilitate open-market repurchases, or otherwise, from time to time.

Under our license agreement with Pulmokine, we have payment obligations that are contingent upon future events such as our achievement of specified development, regulatory and commercial milestones and are required to make royalty payments in connection with the sale of products developed under the agreement. As of MarchJune 31,30, 2026, we were unable to estimate the timing or likelihood of achieving the milestones or making future product sales. Other contractual obligations include future payments under the 2027 Notes and 2030 Notes and existing operating leases.

From our inception through MarchJune 31,30, 2026, our operations have been financed primarily by proceeds of $1,396.9 million from the sale of Series A and Series B convertible preferred stock, proceeds from our IPO, proceeds from the 2027 Notes and 2030 Notes, proceeds from issuance of common stock in May 2020 and July 2022, proceeds from issuance of common stock and accompanying warrants in July 2023 and the Chiesi Collaboration Agreement. In addition, we have received $48.6$57.9 million as of MarchJune 31,30, 2026 through reimbursement related to the Chiesi Collaboration Agreement. As of MarchJune 31,30, 2026 we had cash, cash equivalents and marketable securities of $99.2$57.0 million. Cash in excess of immediate requirements is invested in accordance with our investment policy, primarily with a view to capital preservation and liquidity.

On May 3, 2024, we entered into the Chiesi Collaboration Agreement. In consideration and as reimbursement for our development costs, Chiesi paid us an up-front, nonrefundable payment of $160.0 million. In addition, we and Chiesi share equally in the costs of ongoing global seralutinib clinical development, with the exception of the PROSERA Phase 3 study, and the costs of commercialization in the U.S. Territory. For the threesix months ended MarchJune 31,30, 2026, we received cost-sharing payments from Chiesi in the amount of $12.2$21.5 million.

On January 28, 2026, we filed a registration statement on Form S-3 ASR, or the 2026 Shelf Registration Statement, covering the offering from time to time of common stock, preferred stock, debt securities, warrants and units, which registration statement became automatically effective upon filing. On March 17, 2026, we filed Post-Effective Amendment No. 1 and Post-EffectivePost- Effective Amendment No. 2 to the 2026 Shelf Registration Statement, which became effective on March 18, 2026, to convert the registration statement to a non-automatic shelf registration statement as we were no longer a “well-known seasoned issuer.”

The opinion of our independent registered public accounting firm on our audited financial statements as of and for the years ended December 31, 2025 contains an explanatory paragraph regarding substantial doubt about our ability to continue as a going concern. Future reports on our financial statements may include an explanatory paragraph with respect to our ability to continue as a going concern. Our consolidated condensed financial statements as of and for the three and six months ended MarchJune 31,30, 2026 and 2025 included in this Form 10-Q do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts of liabilities that might be necessary should we be unable to continue our operations.

The following table shows a summary of our cash flows for each of the threesix months ended MarchJune 31,30, 2026 and 2025, respectively:

During the threesix months ended MarchJune 31,30, 2026, operating activities used approximately $38.7$78.1 million of cash, primarily resulting from a net loss of $46.7$29.8 million and changes in contract liabilities of $9.0$12.4 million, changes in accrued research and development expenses of $12.0 million and gain on debt extinguishment of $43.8 million, reduced by changes in accounts payable of $6.2 million, changes in stock-based compensation expense of $6.3 million, changes in receivable from contracts with collaborators of $3.0$8.8 million and changes in prepaid expenses and other current assets of $2.4$8.9 million.

During the threesix months ended MarchJune 31,30, 2025, operating activities used approximately $39.7$86.8 million of cash, primarily resulting from the net loss of $36.6$74.9 million and changes in accruedaccounts compensationpayable of $6.8 million, changes in prepaid expenses and benefitsother current assets of $5.8$5.4 million and changes in amortization of premium on investments of $4.6 million, reduced by changes in stock-based compensation expense of $2.4$5.0 million.

During the threesix months ended MarchJune 31,30, 2026, investing activities provided approximately $41.6$84.3 million of cash, primarily resulting from the maturities of marketable securities of $66.6$109.3 million, offset by the purchases of marketable securities of $25.0 million.

During the threesix months ended MarchJune 31,30, 2025, investing activities provided approximately $22.1$66.2 million of cash, primarily resulting from the maturities of marketable securities of $123.1$242.8 million, offset by the purchases of marketable securities of $101.0$176.5 million.

During the threesix months ended MarchJune 31,30, 2026, financing activities providedused $0.5approximately $2.6 million of cash, primarily resulting from the payment of debt and equity issuance costs in connection with the exchange of the 2027 Notes of $3.1 million, reduced by the proceeds from issuance of common stock pursuant to the ESPP of $0.3 million and the proceeds from the exercise of stock options of $0.2 million.

During the threesix months ended MarchJune 31,30, 2025, financing activities provided $0.5approximately $0.6 million of cash, primarily resulting from the proceeds from issuance of common stock pursuant to the ESPP of $0.4 million and the proceeds from the exercise of stock options of $0.1$0.2 million.

Based on our current operating plan, we believe that our existing cash, cash equivalents and marketable securities, will be sufficient to fund our operations into the first quarter of 2027. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we expect. Additionally, the process of testing seralutinib in clinical trials and seeking regulatory approval is costly, and the timing of progress and expenses in these trials is uncertain. Pending feedback from the FDA on a potential path forward for seralutinib, weWe also expect that the level of spending for our ongoing and planned commercial planning activities for seralutinib may increase.