3. Discontinued Operations and TSA

On September 30, 2024, the Company completed the sale (the “Transaction”) of its VOWST microbiome therapeutic business (the “VOWST Business”), including inventory and equipment, certain patents and patent applications, know-how, trade secrets, trademarks, domain names, marketing authorizations and related rights, documents, materials, business records and data and contracts that are used or held for use primarily in the development, commercialization and manufacturing of the microbiome product sold under the brand name VOWST as provided for in accordance with the terms of the Purchase Agreement (the “Product”), to Société des Produits Nestlé S.A. (“SPN”), a wholly-owned subsidiary of Nestlé S.A., and its designated affiliates (collectively, “Nestlé Health Science”) pursuant to the Asset Purchase Agreement, dated as of August 5, 2024 (the “Purchase Agreement”), by and among the Company and SPN, and a wholly-owned subsidiary of Nestlé S.A.

The Company also entered into a Transition Services Agreement (“TSA”) with Nestlé Enterprises S.A., (“NESA”), an affiliate of SPN, in connection with the Transaction, through which the Company provided certain manufacturing services until December 31, 2025, and other transition services, for the duration specified in the schedule to the TSA for each service. The Company's obligations under the TSA are now complete. For the three months ended March 31, 2026 and 2025, the Company recognized $0 and $6,309 respectively, of TSA reimbursement income in other income in the Company’s condensed consolidated statements of operations and comprehensive (loss) income. For the three months ended March 31, 2026 and 2025, the Company incurred $0 and $3,527, respectively, of expenses related to manufacturing services and $0 and $2,248, respectively, of TSA labor and passthrough expenses to support the transition services, including finance and accounting, information technology, human resources, operations, and other services.

For the three months ended March 31, 2026 and 2025, $0 and $7,403, respectively, was billed to NESA related to transition services performed by the Company, and the Company received $360 and $56,709 from NESA during the periods, respectively. The payments received in the first quarter of 2025 included the installment payment of $50,000 received in January 2025 which was conditioned on the Company’s material compliance with obligations under the TSA. The installment payment was recognized in Gain on sale of VOWST Business within continuing operations in the Company’s condensed consolidated statements of operations and comprehensive income for the three months ended March 31, 2025 as the gain was realizable. As of March 31, 2026 and December 31, 2025, the Company had $0 and $360 in accounts receivable due from SPN - related party in the Company’s condensed consolidated balance sheets.

The Company has estimated costs associated with certain accrued liabilities due to SPN - related party as a loss contingency in accordance with ASC 450, Contingencies. These contingent liabilities are presented as Accrued Liabilities due to SPN - related party from continuing operations on the condensed consolidated balance sheet as of March 31, 2026 and December 31, 2025 and consist of the following (in thousands):

The contingent liabilities accrued on the Company's condensed consolidated balance sheet are remeasured at each reporting period based on i) cash payments made by the Company to reduce the accrued liabilities due to SPN - related party and ii) revised estimates of the total remaining liabilities due to SPN - related party. For the three months ended March 31, 2026 and 2025, the

Company recognized a gain on sale of VOWST Business of $0 and $2,181, respectively, as a result of the change in accrued liabilities due to SPN - related party.

The Company has excluded from its condensed consolidated balance sheets the effects of certain milestone payments which may be received by the Company after the Product has achieved net sales-based milestones. These contingent receivables will be recognized as a gain contingency, in accordance with ASC 450, Contingencies, in continuing operations in the period when the contingencies are resolved.