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

Investing in our securities involves a high degree of risk. You should carefully consider the risks described below, as well as the other information in this Annual Report, including our financial statements and the related notes and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Annual Report, before deciding whether to investpurchase, inhold or sell our securities. The occurrence of any of the events or developments described below could harm our business, financial condition, results of operations and growth prospects. In such an event, the market price of our securities could decline, and you may lose all or part of your investment. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business operationsoperations.

We are a clinical-stage drug development company with limited resources, no revenue, a limited operating history and have no products approved for commercial sale, which may make it difficult to evaluate our current business and predict our future success and viability;

If we are unable to successfully raise additional capital,capital on a timely basis or on acceptable terms, our future clinical trials and product development could be limited or delayed and our long-term viability may be threatened;

Drug development is a highly uncertain undertaking and involves a substantial degree of risk. We have never generated any revenue from product sales,sales and, we may never gain approval for our product candidates or, even if our product candidates are approved, generate any revenue from product sales, and we may fail to generate further revenue from grantssales or contracts or to be profitable;

If we fail to obtain additional financing,financing on a timely basis or on acceptable terms, we may be unable to complete the development of and, if approved, commercialization of our product candidates;

Our business is highly dependent on the success of our initial product candidatescandidate, IKT-001, targeting neurodegenerative,pulmonary cardiopulmonaryarterial andhypertension oncological diseases(“PAH”);

Positive results from early preclinical or clinical studies of our product candidates including, without limitation, the Phase 3 IMPRES study, are not necessarily predictive of the results of later preclinical studies and any current and future clinical trials of our product candidates;

We have limitednever experiencecompleted a registrational clinical trial as a company and may be unable to successfully do so with conducting clinical trials for novel drug substances and no history of commercializing pharmaceutical products,IKT-001, which may make it difficult to evaluate the prospects for our future viability;

Our clinical trials may reveal significant adverse events, toxicities or other side effects not seen in our preclinical or earlier clinical studies and may result in a safety profile that could inhibit regulatory approval or market acceptance of any of our product candidates;

Our current and planned clinical trials may fail to demonstrate substantial evidence of the safety and efficacy of our product candidates, or may require additional clinical studies to be undertaken, which would prevent, delay or limit the scope of regulatory approval and commercialization;

TheWe have limited manufacturing experience and the manufacture of our product candidates is complexcomplex, reliant on external expertise and capabilities, and difficulties or delays may be encountered in production;

The regulatory approval processes of the FDA,United States Food and Drug Administration (“FDA”), European Medicines Agency (“EMA”) and comparable foreign regulatory authorities are lengthy, costly, time consuming, and inherently unpredictable. Regulatory authorities have substantial discretion in the approval process and may refuse to accept an application, may disagree with our regulatory strategy or proposed pathway for approval or may decide that our data are insufficient for approval and require additional preclinical, clinical or other studies;

We expect tomay depend in whole or in part on collaborations with third parties for the research, development and commercialization of any product candidates we may develop;

We are a clinical-stage drug development company with limited resources, no revenue, a limited operating history and have no products approved for commercial sale, which may make it difficult to evaluate our current business and predict our future success and viability.

We are a clinical stageclinical-stage drug development company that commenced operations in September 2008. We have limited facilities to conduct fundamental research and we have performed our research and development activities by collaboration with contract service providers, and contract manufacturers and by designing and developing research programs in collaboration with university-based experts who work with us to evaluate mechanism(s) of disease for which we have designed and developed product candidates.manufacturers. Our direct research capabilities are very limited. As of the date of this Annual Report, we have not maintained a principal laboratory or primary research facility for the development of our product candidates. In addition, we have no products approved for commercial salesale, andmay thereforenever allgain approval of our revenueproduct has been obtained solely through grantscandidates, and contractshave not generated revenue from privateproduct foundationssales to date and fromno staterevenues andare federalexpected grants from institutions such asin the Nationalforeseeable Institutes of Health and the Department of Defense.future.

Drug development is a highly complex, resource intensive, uncertain undertaking andthat involves a substantial degree of risk. As of the date of writing this Annual Report, we have notlimited completedexperience as a company with conducting clinical trials for any of our product candidates,candidates and we have not obtained marketing approval as a company for any product candidates, manufactured a commercial scale product,product as a company, or arranged for a third-party to do so on our behalf, or conducted sales and marketing activities necessary for successful product commercialization. Given the highly uncertain nature of drug development, we may never initiate or complete additional clinical trials for any of our product candidates, obtain marketing approval for any product candidates, 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.

Our limited operating history as a company makes any assessment of our future success and viability subject to significant uncertainty. We will encounter risks and difficulties frequently experienced by early-stageclinical stage pharmaceutical companies in rapidly evolving fields, and we have not yet demonstrated an ability to successfully overcome such risks and difficulties. If we do not address these risks and difficulties successfully,successfully or on a timely basis, our business, operating results and financial condition will suffer.

If we are unable to successfully raise additional capital,capital on a timely basis or on acceptable terms, our future clinical trials and product development could be limited or delayed and our long-term viability may be threatened.

We have experienced negative operating cash flows since our inception and funded our operations prior to our initial public offering primarily through private, state and federal contracts and grants. In February 2024, we entered into an At The Market Offering Agreement (“ATM Agreement”) with H.C. Wainwright & Co., LLC, as sales agent, which was subsequently terminated in December 2024. In 2024, we sold 315,338 shares of our Commoncommon Stock were soldstock pursuant to the ATM Agreement for an aggregate gross sales price of $849,188. In October 2024, we completed a private placement of an approximately $110 million (“October 2024 Offering”). In June 2025, we established an “at-the-market” offering program with Jefferies LLC as sales agent with no sales completed as of December 31, 2025. In November 2025, we completed an underwritten public offering of approximately $115 million (“November 2025 Offering”). We anticipate we will need to seek additional funds in the future through equity or debt financings, or strategic alliances with third parties, either alone or in combination with equity financings to complete our product development initiatives. TheseIf available, these financings could result in substantial dilution to the holders of our Commoncommon Stockstock or require contractual or other restrictions on our operations or on alternatives that may be available to us.operations. If we raise additional funds by issuing debt securities, these debt securities could impose significant restrictions on our operations. AnyIf available, any such required financing may not be available timely or in amounts or on terms acceptable to us, and the failure to procure such required financing could have a material and adverse effect on our business, financial condition and results of operations.

the timing and results of the Phase 2b3 clinical objectivesstudy referencedfor underIKT-001 thein October 2024 OfferingPAH and whether holders of Series A-1 Warrants or Series B-1 Warrants electelect, at their sole discretion, to exercise those warrants in accordance with their respective terms;

We may not be able to acquire additional funds on acceptable terms, in a timely fashion, or at all. If we are unable to raise adequate funds, we may have to liquidate some or all of our assets or delay, reduce the scope of or eliminate some or all of our development programs.

Drug development is a highly uncertain undertaking and involves a substantial degree of risk. We have never generated any revenue from product sales,sales and, we may never gain approval for our product candidates or, even if our product candidates are approved, generate any revenue from product sales, and we may fail to generate further revenue from grants or contracts or to be profitable.

We have no products approved for commercial sale and have not generated any revenue from product sales. We anticipate generating additional revenue from private foundations and state and federal grants and contracts prior to generating revenue from product sales, but such grants and contracts are not guaranteed and will not make us profitable. Our ability to successfully commercialize our existing product candidatescandidate IKT-001 depends on our ability to successfully complete our clinical development and obtain regulatory approvals, among other factors. Thus, we may not generate meaningful revenue until after we have successfully begun and completed clinical development and received regulatory approval for the commercial sale of a product candidate. We may never begincomplete clinical development or receive regulatory approval for the commercial sale of a product candidate and thus may never generate revenue from product sales.

Because of the complexity, numerous risks and uncertainties associated with drug development, we are unable to predict the timing or amount of our expenses, or when, if ever, we will be able to generate any meaningful revenue or achieve or maintain profitability. In addition, our expenses could increase beyond our current expectations if we are required by the FDA or foreign regulatory agencies to perform studies in addition to those that we currently anticipate, or if there are any delays in any of our or our future collaborators’ preclinical or clinical trials or the development of any of our product candidates. Even if one or more of our product candidates is approved for commercial sale, we anticipate incurring significant costs associated with commercializing any approved product candidate and ongoing compliance efforts.

Even if we are able to generate revenue from the sale of any approved products, we may not become profitable and may need to obtain additional funding to continue operations. Revenue from the sale of any product candidate for which regulatory approval is obtained will be dependent, in part, upon the size of the markets in the territories for which we gain regulatory approval, the accepted price for the product, the attractiveness or suitability of the attributes of our product candidates to our customers, the ability to get reimbursement at any price and whether we own the commercial rights for that territory. If the number of addressable patients is not as significant as we anticipate, the indication approved by regulatory authorities is narrower than we expect, or the reasonably accepted population for treatment is narrowed by competition, physician choice or treatment guidelines, we may not generate significant revenue from sales of such products, even if approved. Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis.

Although we assess our banking and customer relationships as we believe necessary or appropriate, our access to our cash and cash equivalents and our ability to access bank financing in amounts adequate to finance our operations could be significantly impaired by the financial institutions with which we have arrangements directly facing liquidity constraints or failures. In addition, investor concerns regarding the U.S.United States or international financial systems could result in less favorable commercial financing terms, including higher interest rates or costs and tighter financial and operating covenants, or systemic limitations on access to credit and liquidity sources, thereby making it more difficult for us to acquire or take downutilize financing on acceptable terms or at all. Any material decline in available funding or our ability to access our cash and cash equivalents or our ability to access bank financing could adversely impact our ability to meet our operating expenses and result in breaches of our contractual obligations which could have material adverse impacts on our operations and liquidity.liquidity or otherwise adversely impact our viability.

Various macroeconomic factors could adversely affect our business and the results of our operations and financial condition, including changes in inflation, interest rates and overall economic conditions and uncertainties such as those resulting from the current and future conditions in the global financial markets. Recent supply chain constraints have led to higher inflation, which if sustained could have a negative impact on our product development and operations. If inflation or other factors were to significantly increase our business costs, our ability to develop our current pipeline and new product candidates may be negatively affected. Interest rates, the liquidity of the credit markets and the volatility of the capital markets could also affect the operation of our business and our ability to raise capital on favorable terms, or at all, in order to fund our operations. Similarly, these macroeconomic factors could affect the ability of our third-party suppliers and manufacturers to manufacture clinical trial materials for our product candidates.

seek regulatory approvals and marketing authorizations for our product candidates that successfully complete the clinical trial process;

establish sales, marketing and distribution infrastructure and establish manufacturing capabilities to commercialize any productsproduct candidates for which we may obtain regulatory approval;

obtain, expand, maintain, protect and enforce our intellectual property portfolio, including intellectual property obtained through license agreements;

provide additional internal infrastructure to support our continued research and development operations and any planned commercialization efforts in the future; and defend against any product liability claims or other lawsuits related to our products.

If we fail to obtain additional financing,financing on a timely basis or on acceptable terms, we may be unable to complete the development of and, if approved, commercialization of our current and future product candidates.

Our operations have required substantial amounts of cash since inception.inception and will continue to do so for the foreseeable future. Prior to our initial public offering, we financed our operations primarily through revenue generated by private, state and federal grants and contracts and subsequently through the issuance of securities in various offerings. Developing our product candidates is expensive, and we expect to continue to spend substantial amounts as we fund our early-stagefor research projects, continue preclinical development of our early-stage programsprojects and, in particular, to advance IKT-001 through preclinical development and clinical trials. The successful development of our current and future product candidates, obtaining regulatory approvals and launching and commercializing any product candidate will require substantial additional funding beyond the net proceeds of our securities offerings.

We had cash, cash equivalents, and marketable securities of $97,543,528$178,764,028 as of December 31, 2024.2025. Our estimate as to how long we expect our working capital to be adequate to fund our operations is based on assumptions that may prove inaccurate, and we could use our available capital resources sooner than we currently expect. In addition, delays and changing circumstances may cause us to increase our spending significantly faster than we currently anticipate, and we may need to spend more money than currently expected because of circumstances beyond our control or if we choose to expand more rapidly than we presently anticipate.

We will require additional capital for the further development and, if approved, commercialization of our current and future product candidates. Additional capital may not be available when we need it, on terms acceptable to us, or at all. We have no committed source of additional capital. If adequate capital is not available to us on a timely basis, we may be required to significantly delay, scale back or discontinue our research and development programs or the commercialization of any product candidates, if approved, or be unable to continue or expand our operations or otherwise capitalize on our business opportunities, as desired, which could materially affect our business, prospects, financial condition and results of operations and cause the price of our common stock to decline. Market volatility resulting from future epidemics, pandemics or other factors could also adversely impact our ability to access capital as and when needed.

Program expenses include expenses associated with our most advanced product candidates and the discovery and development of compounds that are potential future candidates. We also track external expenses associated with our third-party research and development efforts. All external costs are tracked by therapeutic indication. We do not track personnel or other operating expenses incurred for our research and development programs on a program-specific basis. These expenses primarily relate to salaries and benefits and stock-based compensation and office consumables.

our ability to conductcommence and commenceconduct trials;

our ability to establish an appropriate safety or tolerability profile with IND-enabling toxicology studies;

Our direct research and development expenses consist principally of external costs, such as fees paid to investigators, consultants, central laboratories and CROs in connection with our clinical studies, and costs related to acquiring and manufacturing clinical study materials. We allocate salary and benefit costs directly related to specific programs. We do not allocate personnel-related discretionary bonus or stock-based compensation costs, laboratory and related expenses, depreciation or other indirect costs that are deployed across multiple projects under development and, as such, the costs are separately classified as other research and development expenses in the table below:

Selling, general and administrative expenses include personnel related expenses, such as salaries, benefits, travel and non-cash stock-based compensation expense, expenses for outside professional services and allocated expenses. Outside professional services consist of legal, accounting and audit services and other consulting fees. Allocated expenses consist of rent expenses related to our former offices in Lexington, Massachusetts and Atlanta, Georgia not otherwise included in research and development expenses.

We expect to incur additional expenses as a result of operating asAs a public company, includingwe incur expenses related to compliance with the rules and regulations of the Securities and Exchange Commission (“SEC”) and those of any national securities exchange on which our securities are traded,Nasdaq, additional insurance expenses, investor relations activities and other administrative and professional services. We also are also increasing our administrative headcount as a public company and as we advance our product candidates through clinical development, which will also likely require us to increase our selling, general and administrative expenses.

Selling, general and administrative expenses increased by $4,646,575$12,176,559 or 69.0%107% to $11,378,520$23,555,079 from $6,731,945$11,378,520 in the prior year. The $4.6$12.2 million increase was primarily driven by an increase of $3.1$6.4 million in stock-based compensation, a $2.0$4.2 million increase in personnel-related costs, including severance costs of approximately $1.0 million for our former Chief Executive Officer and Chief Financial Officer, $0.8 million increase in legal, consultingcompliance and compliancesupport relatedservice fees partially offset byfees, a $0.3$0.2 million decreaseincrease in insurance, primarily in Directors and Officers (“D&O”) insurance, a $0.5 million decrease in advertising and promotions and a net$0.6 million increase of $0.3 million in allmiscellaneous other selling, general and administrative expenses.

Interest income increased by $8,273$2,645,912 or 0.8%247.5% to $1,069,182$3,715,094 from $1,060,909$1,069,182 in the prior comparable period. The increase was driven by interest earned on our increased balances of cash, cash equivalents and marketable securities.

From our inception up until our December 2020 Initialinitial Publicpublic Offering,offering, we funded our operations primarily through private, state and federal contracts and grants. In October 2024, we raised approximately $99.6 million in net proceeds from a private placement and in November 2025, we raised approximately $107.6 million in net proceeds from our underwritten public offering.

At December 31, 2024,2025, the Companywe had cash, cash equivalents, and marketable securities of $97,543,528.$178.8 million.

TheWe Company hashave incurred recurring losses since our inception and at December 31, 20242025 had an accumulated deficit of $94,420,611.$142.7 million.

To date, we have not generated any revenue from the sale of commercial products. We do not expect to generate any significant revenue from product sales unless and until we obtain regulatory approval of and successfully commercialize any of our product candidates and we do not know when, or if, this will occur. We expect to continue to incur significant losses for the foreseeable future, and we expect the losses to increase as we continue the development of, and seek regulatory approvals for, our product candidates, and begin to commercialize any future approved products. We are subject to all of the risks typically related to the development of new product candidates, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business. Moreover, following the completion of the December 2020 initial public offering, we incurred additional costs associated with operating as a public company. We anticipate that we will need substantial additional funding in connection with our continuing operations.

Since our inception, we have incurred significant losses and negative cash flows from operations. We have an accumulated deficit of $94,420,611$142.7 million at December 31, 2024.2025. We expect to incur substantial additional losses in the future as we conduct and expand our research and development activities.

We may seekexpect to fund our operations through public equity or private equity or debt financings, as well as other sources. However, we may be unable to raise additional working capital, or if we are able to raise additional working capitalcapital, we may be unable to do so on commercially favorable terms. Our failure to raise capital or enter into such other arrangements if and when needed would have a negative impact on our business, results of operations and financial condition and our ability to continue to develop our product candidates.

Net cash flows used in operating activities for the year ended December 31, 20232025 totaled $18,085,043,$27.8 million, and consisted primarily of a net loss of $19.0$48.3 million adjusted for non-cash stock compensation of $0.5$15.3 million, depreciationa write-off of in-process research and lease expensedevelopment of $0.2$7.4 million associated with the CorHepta transaction, a decrease in the fair value of contingent consideration of $1.4 million associated with the CorHepta transaction, non-cash accretion on marketable securities of $0.9 million, an increase prepaid research and development of $1.9 million mainly associated with our PAH program, a decrease in prepaid expenses and other current assets of $0.1 million, decrease in accounts payable of $0.5 million, decrease in prepaid research and development of $0.9 million and aan decreaseincrease in accrued expenses and other current liabilities of $0.1$1.4 million.

Cash Provided by (Used in) Provided by Investing Activities

Net cash flows provided by investing activities for the year ended December 31, 2023,2025, totaled $11,656,666,$2.1 million, of which $29.4$41.6 million was provided by maturity of marketable securities, $39.1 million was used for the purchase of marketable securities investmentsand $0.4 million related to acquired in-process research and $41.1development millionassociated waswith providedthe byCorHepta maturityacquisition ofdiscussed marketable securities.above.

Net cash provided by financing activities for the year ended December 31, 20232025 totaled $8,405,003,$108.5 million, which consisted of $8.5$107.6 million of net proceeds from the issuance of common stock and pre-funded warrants in connection with our underwritten public offering in November 2025 and $0.1$0.8 million of deferrednet offeringproceeds costs.from the issuance of common stock related to the exercise of stock options.

OnIn April 18, 2022, the Companywe entered into an operating lease agreement through September 30, 2025 for itsour office space in Lexington, Massachusetts. The Lexington lease containscontained escalating payments during the lease period. Upon execution of this lease agreement, the Companywe prepaid one month of rent, which applied to the first month's rent, and a security deposit, which will beis held in escrow and will be credited atafter the termination of the lease.lease with the refund expected in the first half of 2026. Our total lease obligation at December 31, 2025 is $114,966, consisting of minimum annual rental obligations of $114,966 for fiscal year 2025.$0.

We record research and development expenses to operations as incurred. Research and development expenses represent costs incurred by us for the discovery and development of our product candidates and the development of our RAMP™ drug discovery program and prodrug technologies and include: employee-related expenses, such as salaries, benefits, travel and non-cash stock-based compensation expense; external research and development expenses incurred under arrangements with third parties, such as CROs, preclinical testing organizations, clinical testing organizations, CMOs, academic and non-profit institutions and consultants; costs to acquire technologies to be used in research and development that have not reached technological feasibility and have no alternative future use; license fees; and other expenses, which include direct and allocated expenses for laboratory, facilities and other costs.

We have granted stock-based awards, consisting of non-qualified stock options and incentive stock options, to our employees, and non-qualified stock options to certain non-employee consultants and members of our board of directors, both past and present. We measure stock-based compensation expense for stock options granted to our employees and directors on the date of grant and recognize the corresponding compensation expense of those awards over the requisite service period, which is generally the vesting period of the respective award.

The intrinsic value of all in the moneyin-the-money outstanding options as of December 31, 20242025 was approximately $31.1$7.7 million, based on the closing price of our common stock of $3.25$2.05 per share at December 31, 2024,2025, and $15.8$5.7 million of the intrinsic value of options was exercisable.

Investing in our common stock involves a high degree of risk. For a detailed discussion of the risks and uncertainties related to our business, please refer to the section titled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 as filed with the Securities and Exchange Commission (the “SEC”) on March 26, 2026 (the “Annual Report”). ThereOther than risks included below that have been amended and restated, there have been no material changes from the risk factors set forth in the Annual Report.

We are a clinical-stage pharmaceutical company developing IKT-001 for Pulmonary Arterial Hypertension (“PAH”). Our lead product candidate, known as IKT-001, a prodrug of imatinib mesylate (“imatinib”), for PAH which is an orphan indication. Imatinib was first approved in the United States in 2001 for various cancers and blood disorders and, following more than 20 years of clinical use, has a well-characterized safety profile with the first reported use of imatinib in PAH occurring in 2005. PAH is a progressive, life-threatening disease characterized by pulmonary vascular remodeling and elevated pulmonary vascular resistance that affects approximately 50,000 Americans. We have completed a non-human primate safety study and a bioequivalence clinical study in healthy volunteers to determine the doses of IKT-001 that are equivalent to imatinib. Our Phase 3 clinical study, named IMPROVE-PAH (IKT-001 for Measuring Pulmonary Vascular Resistance and Outcome Variables in a Phase 3 Evaluation of PAH), which is a single pivotal global study, is presently enrolling patients.patients with 26 country regulatory approvals and 43 clinical sites activated to date, and 3 additional pending country regulatory approvals and 4 planned country regulatory submissions.

our ability to successfully file Investigational New Drug (“IND and NDA”) applications with the FDA;

(1) The Marchsix 31,months ended June 30, 2025 amount includes a one-time (non-cash) charge of $7.4 million for the acquired IPR&D related to the acquisition of CorHepta Pharmaceuticals, Inc. (“CorHepta”).

(2) Other research and development expenses include stock-based compensation expense of $1.8$1.5 million and $0.5$1.7 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively, and $3.3 million and $2.1 million for the six months ended June 30, 2026 and 2025, respectively.

Selling, general and administrative expenses include personnel-related expenses, such as salaries, benefits, travel and non-cash stock-based compensation expense,expense and expenses for outside professional services and allocated expenses.services. Outside professional services consist of legal, accounting and audit services and other consulting fees. Allocated expenses consist of rent expenses related to our former office in Lexington, Massachusetts not otherwise included in research and development expenses.

Comparison of the Three Months Ended MarchJune 31,30, 2026 and 2025

Selling, general and administrative expenses increased by $2,126,832$1,737,800 or 40.5%29.4%, to $7,376,123$7,657,531 from $5,249,291$5,919,731 in the prior comparable period. The $2.1$1.7 million increase was primarily driven by ana increase of $0.4 million in personnel-related costs, $2.2$1.3 million increase in stock-based compensation expense, partiallyan offsetincrease byof a $0.5$0.4 million decrease in legal, consulting and compliance costs, and an increase of $0.3 million in other expenses, partially offset by a decrease of $0.2 million in personnel-related costs.

Change in fair value contingent consideration decreased by $791,510$358,420 or 67.9%100%, to $373,354$0 from $1,164,864$358,420 in the prior comparable period. The decrease is a result of the change in fair value of the contingent consideration related to the CorHepta transaction from DecemberMarch 31, 2025 to FebruaryJune 21,30, 2026,2025. the date theThe service milestone was satisfied.satisfied and the contingent liability settled on February 21, 2026.

Other income increased by $541,808$543,009 or 58.9%59.2% to $1,461,079$1,459,764 from $919,271$916,755 in the prior comparable period. The increase was driven by an increase in interest earned on our cash, cash equivalents and marketable securities.

On June 20, 2025, we entered into an Open Market Sale AgreementSM (the “Sales Agreement”) with Jefferies LLC, as sales agent ("Jefferies"), pursuant to which we may, from time to time, issue and sell shares of our common stock through or to Jefferies. Under the terms of the Sales Agreement, Jefferies may sell the shares of our common stock at market prices by any method that is deemed to be an "at the market offering" as defined in Rule 415 under the Securities Act of 1933, as amended. As of December 31, 2025, no shares of our common stock had been sold under the Sales Agreement. In February 2026, we sold 1,904,762 shares of common stock pursuant to the Sales Agreement for an aggregate gross sales price of $3.0 million. In July 2026, we sold 25,261,500 shares of our common stock pursuant to the Sales Agreement for aggregate gross proceeds of $50.5 million.

At MarchJune 31,30, 2026, we had cash, cash equivalents and marketable securities of $170.4$159.0 million.

We have incurred recurring losses and at MarchJune 31,30, 2026 had an accumulated deficit of $159.1$178.7 million.

To date, we have not generated any revenue from the sale of commercial products. We do not expect to generate any significant revenue from product sales unless and until we obtain regulatory approval of and successfully commercialize any of our product candidates and we do not know when, or if, this will occur.occur at all. We expect to continue to incur significant losses for the foreseeable future, and we expect the losses to increase as we continue the development of, and seek regulatory approvals for,for our lead product candidates,candidate, IKT-001, and begin to commercialize any future approved products.products which we may in-license or develop. We are subject to all of the risks typically related to the development of new product candidates, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business. We anticipate that we will need substantial additional funding in connection with our continuing operations.

Since our inception, we have incurred significant losses and negative cash flows from operations. We have an accumulated deficit of $159.1$178.7 million at MarchJune 31,30, 2026. We expect to incur substantial additional losses in the future as we conduct and expand our research and development activities.

We believe that our existing cash, cash equivalents and marketable securities as of MarchJune 31,30, 2026, will enable us to fund our operating requirements for at least the next twelve months following the date of this Quarterly Report. We estimate that the additional capital raised through our sale of common stock through our ATM in July 2026, together with our cash and cash equivalents and marketable securities as of June 30, 2026 will support operations through topline data readout in Part B of our ongoing global Phase 3 IMPROVE-PAH clinical study, assuming the full and timely exercise of the outstanding Series A and B Warrants. However, we have based these estimates on assumptions that may prove to be mistimed or wrong, and we could deplete our working capital sooner than planned.

any costs, including upfront of or licensingmilestone costs, associated with new programs such as any in-licensed new compounds or expanded indications of IKT-001;

Net cash flows used in operating activities for the threesix months ended MarchJune 31,30, 2026, totaled $12,059,722,$24,503,334, and consisted primarily of a net loss of $16.4$36.0 million adjusted for non-cash stock compensation of $5.6$10.9 million, a decrease in the fair value of contingent consideration of $0.4 million, non-cash accretion on marketable securities of $0.8$2.0 million, an increase in accounts payable and accrued expenses and other current liabilities of $0.5$5.0 million, an increase in prepaid expenses and other current assets of $0.9$0.6 million, aan decreaseincrease in prepaid research and development of $0.5$1.3 million, and an increase in other assets of $0.1 million.

Net cash flows used in operating activities for the threesix months ended MarchJune 31,30, 2025, totaled $4,103,530,$9,677,761, and consisted primarily of a net loss of $13.7$23.6 million adjusted for non-cash stock compensation of $2.0$6.3 million, a write-off of in-process research and development of $7.4 million, a decrease in the fair value of contingent consideration of $1.2$1.5 million, an increase in accounts payable of $0.7$1.6 million, and an increase in accrued expenses and other current liabilities of $0.8$0.3 million and a net decrease in other operating assets and liabilities of $0.1 million.

Net cash flows used in investing activities for the threesix months ended MarchJune 31,30, 2026, totaled $80,484,587,$86,393,289, of which $10.1$59.2 million was provided by maturity of marketable securities and $90.6$145.6 million was used for the purchase of marketable securities.

Net cash flows provided by investing activities for the threesix months ended MarchJune 31,30, 2025, totaled $21,054,342,$30,898,080, of which $21.5$31.4 million was provided by maturity of marketable securities offset byand $0.4 million related to acquired in-process research and development associated with the CorHepta acquisition discussed above.

Net cash flows provided by financing activities for the threesix months ended MarchJune 31,30, 2026, totaled $2,897,611,$2,883,122, which consisted of net proceeds from the issuance of common stock in connection with the Sales Agreement with Jefferies.

We previously leased office space in Lexington, Massachusetts under an operating lease that expired on September 30, 2025. As of MarchJune 31,30, 2026, we have no remaining lease obligations under this arrangement. We expect to receivereceived a refund of our security deposit, which is helddeposit in escrow, during the second quarter ofJuly 2026. The refund is not expected to have a material impact on our liquidity or results of operations.

We have entered into various agreements with contract research organizations ("CROs") and contract manufacturing organizations ("CMOs") to support our ongoing Phase 3 clinical study, IMPROVE-PAH, as well as related manufacturing activities. We may also need CMOs for redundancy and to support commercial production, if we achieve regulatory approval for IKT-001. These agreements generally include both fixed and variable components and, in certain cases, are non-cancelable or subject to termination fees.

As of MarchJune 31,30, 2026, our estimated remaining contractual commitments under these arrangements, excluding performance-based milestone payments, were approximately $58.4$106.6 million for CRO services and $9.2$9.8 million for CMO services, which we expect to incur primarily through 2030. The timing of these expenditures is dependent on several factors, including patient enrollment rates, clinical site activation, and manufacturing production schedules.

A portion of our CRO commitments includes performance-based milestone payments, of which approximately $7.5 million of the total contracted value is contingent upon the achievement of specified criteria by the vendor. The timing and likelihood of these payments are uncertain and depend on the progress and outcomes of the clinical trial. While one milestone of $0.4 million has been achieved to date, the remaining milestones are not currently considered probable and, accordingly, are not reflected in our accrued liabilities as of MarchJune 31,30, 2026.

As part of the process of preparing the condensed consolidated financial statements, we are required to estimate and accrue expenses. A portion of our research and development expenses are external costs, which we track on a program-specific basis. We record the estimated expenses of research and development activities conducted by third party service providers as they are incurred and provided within research and development expense in the condensed consolidated statements of operations.operations and comprehensive loss. These services include the conduct of preclinical studies and consulting services. These costs are a significant component of our research and development expenses. Typically, upfront payments and milestone payments made for the licensing of technology are expensed as research and development in the period in which they are incurred, except for payments relating to intellectual property rights with future alternative use which will be expensed when the intellectual property is in use. Non-refundable advance payments for goods or services to be received in the future for use in research and development activities are recorded as prepaid expenses. The prepaid amounts are expensed as the related goods are delivered or the services are performed.

As of the acquisition date, the achievement of one of the contingent consideration milestones was deemed probable, and the fair value of the related shares was included in the purchase price of the acquisition. We remeasure the initial contingent consideration recognized at acquisition to fair value at each reporting date and recorded a change in fair value of $0 and $373,354 for the three-monththree periodand six months ended MarchJune 31,30, 2026, respectively which is included within operating expenses and $358,420 and $1,523,284 for the three and six months ended June 30, 2025, respectively, which is included within operating expenses. We recognized a contingent consideration liability and corresponding expense for the remaining contingent consideration shares in future periods when it was probable that a liability had been incurred and the amount of that liability could be reasonably estimated.

The IPR&D had not reached technological feasibility and had no alternative future use at the acquisition date, and therefore, the acquired IPR&D asset of $7,357,294 was written-offwritten off as research and development expense in our consolidated statements of operations and comprehensive loss immediately following the acquisition in accordance with ASC 730.

However, we continue to qualify as a “smaller reporting company,” as defined in the Securities Exchange Act of 1934, as amended,amended or(the “Exchange Act,Act”), and have elected to take advantage of certain of the scaled disclosures available to smaller reporting companies. To the extent that we continue to qualify as a “smaller reporting company” as such term is defined in Rule 12b-2 under the Exchange Act, certain of the exemptions available to us as an “emerging growth company” continue to be available to us as a “smaller reporting company,” including exemption from compliance with the auditor attestation requirements pursuant to SOX and reduced disclosure about our executive compensation arrangements. We will continue to be a “smaller reporting company” for so long as we have either (i) a public float of less than $250 million measured as of the last business day of our most recently completed second fiscal quarter, or (ii) annual revenue of less than $100 million during our most recently completed fiscal year and either no public float or a public float of less than $700 million measured as of the last business day of our most recently completed second fiscal quarter.