Purchase and Sale Agreement	8 Months Ended
Dec. 31, 2025
Purchase And Sales Agreement [Abstract]
Purchase and Sale Agreement	Note 14. Purchase and Sale Agreement Royalty Liability In November 2024, the Company entered into a PSA pursuant to which it is potentially eligible to receive payments from DRI up to $179.0 million. Under the terms of the synthetic royalty financing agreement, the Subsidiary received an upfront payment of $100.0 million in exchange for tiered royalty payments on worldwide net sales of sebetralstat, as follows: 5.00% on annual net sales up to and including $500.0 million (the “First Tier Royalty Rate”); 1.10% on annual net sales above $500.0 million and up to and including $750.0 million; and 0.25% on annual net sales above $750.0 million. Beginning in calendar year 2031, the First Tier Royalty Rate for any calendar year will be determined based on annual net sales of sebetralstat for the prior calendar year: 5.00% if the prior year’s annual net sales are at or above $500.0 million or 5.65% if the prior year’s annual net sales are below $500.0 million. Additionally, if sebetralstat achieves annual net sales of at least $550.0 million in any calendar year ending before January 1, 2031, the Subsidiary will earn a sales-based milestone payment of $50.0 million. As sebetralstat was approved prior to October 1, 2025, the Subsidiary elected to receive the one-time cash payment of $22.0 million in July 2025. As a result, the First Tier Royalty Rate on net sales up to and including $500.0 million increased from 5.00% to 6.00% and the sales-based milestone increased from $50.0 million to $57.0 million. Additionally, beginning in calendar year 2031, the First Tier Royalty Rate will increase from 5.00% to 6.00% if the prior year's annual net sales are at or above $500.0 million and from 5.65% to 6.75% if the prior year's annual net sales are below $500.0 million. On receipt of the $100.0 million payment from DRI, the Company recorded a royalty obligation of $93.6 million, net of the initial fair value of the bifurcated embedded derivative liability upon execution of the PSA, and debt issuance costs incurred. With the additional $22.0 million payment from DRI obtained in July 2025, the Company recorded a royalty obligation of $122.9 million, net of the fair value of the bifurcated embedded derivative liability. The PSA is considered a sale of future revenues and is accounted for as long-term debt recorded at amortized cost using the effective interest rate method. The effective interest rate is calculated based on the rate that would enable the debt to be repaid in full over the anticipated life of the arrangement. The Company recorded $11.5 million and $5.7 million of interest expense for the eight-month period ended December 31, 2025 and twelve months ended April 30, 2025, respectively, related to this arrangement in the consolidated statements of operations and comprehensive loss. The interest rate on this liability may vary during the term of the agreement depending on a number of factors, including the level of forecasted net sales. The Company evaluates the interest rate quarterly based on its current net sales forecasts utilizing the prospective method. A significant increase or decrease in actual or forecasted net sales may materially impact the revenue interest liability, interest expense, other income, and the time period for repayment. The royalty obligation, net of the bifurcated embedded derivative liability, had a net carrying amount of $127.6 million as of December 31, 2025. The PSA is denominated in U.S. Dollars and was executed with the Company’s wholly owned U.K. Subsidiary, whose functional currency is the British Pound. Embedded Derivative Liability Under the PSA, the Subsidiary has the option (the “Buy-Back Option”) to repurchase future Revenue Participation Rights at any time until December 31, 2026 either (i) in the event of a change of control of the Subsidiary or (ii) in the event that confirmation that payment of the Revenue Participation Rights will not receive certain tax treatment has not been obtained. Additionally, DRI has an option (the “Put Option”) to require the Subsidiary to repurchase future Revenue Participation Rights in the event of a change of control of the Subsidiary exercisable until December 31, 2026. If the Put Option or the Buy-Back Option is exercised terminating the PSA, the required repurchase price is an amount equal to (a) 1.5 multiplied by (b) the Investment Amount, net of the sum of any payments received by DRI prior to such Put Option or Buy-Back Option repurchase date, as applicable. The Buy-Back and Put Options are considered embedded derivatives requiring bifurcation as a single compound derivative instrument. The Company estimated the fair value of the derivative liability using a “with-and-without” method. The with-and-without methodology involves valuing the whole instrument on an as-is basis and then valuing the instrument without the individual embedded derivative. The difference between the entire instrument with the embedded derivative compared to the instrument without the embedded derivative is the fair value of the derivative liability. The Company recorded $4.4 million for the initial fair value of the derivative liability upon the closing of the PSA and subsequently recorded an incremental $2.0 million when the $22.0 million drawdown was recorded by the Company. The initial fair value allocated to the derivative liability was recorded against the royalty obligation as a debt discount, which is being amortized in interest expense in the consolidated statements of operations and comprehensive loss over the expected term using the effective interest method. The embedded derivative is subsequently remeasured at fair value each reporting period, with the change in fair value being recorded as a component of other income, net in the consolidated statements of operations and comprehensive loss. The Company recognized a $3.4 million decrease and $1.7 million increase for the eight-month period ended December 31, 2025 and twelve months ended April 30, 2025, respectively, as a component of other income, net as the change in fair value for the embedded derivative liability. Bifurcated embedded derivatives are classified with the related host contract in the Company’s consolidated balance sheets. Of the $132.6 million royalty obligation as of December 31, 2025, the embedded derivative had a fair value of $5.0 million. The estimated probability and timing of underlying events triggering the exercisability of the Buy-Back and Put Options contained in the PSA, forecasted cash flows and the discount rate are significant unobservable inputs used to determine the estimated fair value of the entire instrument with the embedded derivative. Management concluded the Buy-Back Option probability was in the lower quartile of possible outcomes. At inception, the estimated market yield used for the valuation of the derivative liability was 9.15%. As of December 31, 2025, the estimated market yield used for the valuation of the derivative liability was 12.00%.

Purchase and Sale Agreement

8 Months Ended

Dec. 31, 2025

Purchase And Sales Agreement [Abstract]

Note 14. Purchase and Sale Agreement

Royalty Liability

In November 2024, the Company entered into a PSA pursuant to which it is potentially eligible to receive payments from DRI up to $179.0 million. Under the terms of the synthetic royalty financing agreement, the Subsidiary received an upfront payment of $100.0

million in exchange for tiered royalty payments on worldwide net sales of sebetralstat, as follows: 5.00% on annual net sales up to and including $500.0 million (the “First Tier Royalty Rate”); 1.10% on annual net sales above $500.0 million and up to and including $750.0 million; and 0.25% on annual net sales above $750.0 million.

Beginning in calendar year 2031, the First Tier Royalty Rate for any calendar year will be determined based on annual net sales of sebetralstat for the prior calendar year: 5.00% if the prior year’s annual net sales are at or above $500.0 million or 5.65% if the prior year’s annual net sales are below $500.0 million. Additionally, if sebetralstat achieves annual net sales of at least $550.0 million in any calendar year ending before January 1, 2031, the Subsidiary will earn a sales-based milestone payment of $50.0 million.

As sebetralstat was approved prior to October 1, 2025, the Subsidiary elected to receive the one-time cash payment of $22.0 million in July 2025. As a result, the First Tier Royalty Rate on net sales up to and including $500.0 million increased from 5.00% to 6.00% and the sales-based milestone increased from $50.0 million to $57.0 million. Additionally, beginning in calendar year 2031, the First Tier Royalty Rate will increase from 5.00% to 6.00% if the prior year's annual net sales are at or above $500.0 million and from 5.65% to 6.75% if the prior year's annual net sales are below $500.0 million.

On receipt of the $100.0 million payment from DRI, the Company recorded a royalty obligation of $93.6 million, net of the initial fair value of the bifurcated embedded derivative liability upon execution of the PSA, and debt issuance costs incurred. With the additional $22.0 million payment from DRI obtained in July 2025, the Company recorded a royalty obligation of $122.9 million, net of the fair value of the bifurcated embedded derivative liability.

The PSA is considered a sale of future revenues and is accounted for as long-term debt recorded at amortized cost using the effective interest rate method. The effective interest rate is calculated based on the rate that would enable the debt to be repaid in full over the anticipated life of the arrangement. The Company recorded $11.5 million and $5.7 million of interest expense for the eight-month period ended December 31, 2025 and twelve months ended April 30, 2025, respectively, related to this arrangement in the consolidated statements of operations and comprehensive loss. The interest rate on this liability may vary during the term of the agreement depending on a number of factors, including the level of forecasted net sales. The Company evaluates the interest rate quarterly based on its current net sales forecasts utilizing the prospective method. A significant increase or decrease in actual or forecasted net sales may materially impact the revenue interest liability, interest expense, other income, and the time period for repayment. The royalty obligation, net of the bifurcated embedded derivative liability, had a net carrying amount of $127.6 million as of December 31, 2025.

The PSA is denominated in U.S. Dollars and was executed with the Company’s wholly owned U.K. Subsidiary, whose functional currency is the British Pound.

Embedded Derivative Liability

Under the PSA, the Subsidiary has the option (the “Buy-Back Option”) to repurchase future Revenue Participation Rights at any time until December 31, 2026 either (i) in the event of a change of control of the Subsidiary or (ii) in the event that confirmation that payment of the Revenue Participation Rights will not receive certain tax treatment has not been obtained. Additionally, DRI has an option (the “Put Option”) to require the Subsidiary to repurchase future Revenue Participation Rights in the event of a change of control of the Subsidiary exercisable until December 31, 2026. If the Put Option or the Buy-Back Option is exercised terminating the PSA, the required repurchase price is an amount equal to (a) 1.5 multiplied by (b) the Investment Amount, net of the sum of any payments received by DRI prior to such Put Option or Buy-Back Option repurchase date, as applicable.

The Buy-Back and Put Options are considered embedded derivatives requiring bifurcation as a single compound derivative instrument. The Company estimated the fair value of the derivative liability using a “with-and-without” method. The with-and-without methodology involves valuing the whole instrument on an as-is basis and then valuing the instrument without the individual embedded derivative. The difference between the entire instrument with the embedded derivative compared to the instrument without the embedded derivative is the fair value of the derivative liability.

The Company recorded $4.4 million for the initial fair value of the derivative liability upon the closing of the PSA and subsequently recorded an incremental $2.0 million when the $22.0 million drawdown was recorded by the Company. The initial fair value allocated to the derivative liability was recorded against the royalty obligation as a debt discount, which is being amortized in interest expense in the consolidated statements of operations and comprehensive loss over the expected term using the effective interest method. The embedded derivative is subsequently remeasured at fair value each reporting period, with the change in fair value being recorded as a component of other income, net in the consolidated statements of operations and comprehensive loss. The Company recognized a $3.4 million decrease and $1.7 million increase for the eight-month period ended December 31, 2025 and twelve months ended April 30, 2025, respectively, as a component of other income, net as the change in fair value for the embedded derivative liability. Bifurcated embedded derivatives are classified with the related host contract in the Company’s consolidated balance sheets. Of the $132.6 million royalty obligation as of December 31, 2025, the embedded derivative had a fair value of $5.0 million.

The estimated probability and timing of underlying events triggering the exercisability of the Buy-Back and Put Options contained in the PSA, forecasted cash flows and the discount rate are significant unobservable inputs used to determine the estimated fair value of the entire instrument with the embedded derivative. Management concluded the Buy-Back Option probability was in the lower quartile of possible outcomes. At inception, the estimated market yield used for the valuation of the derivative liability was 9.15%. As of December 31, 2025, the estimated market yield used for the valuation of the derivative liability was 12.00%.