3. Collaboration, Out-Licensing and Related Agreements

Alfresa Agreement

In March 2020, the Company signed a Letter of Intent (“LOI”) with Alfresa Pharma Corporation (“Alfresa”) for the right to negotiate a definitive agreement for the exclusive license and sublicensable right to develop, register, import, manufacture and commercialize neffy in Japan in exchange for an upfront payment of $2.0 million. In April 2020, the Company entered into a collaboration and license agreement (the “Alfresa Agreement”) for the rights pursuant to the LOI. Under the Alfresa Agreement, the Company delivered a license to neffy technology, completed a required clinical study, and remains obligated to use commercially reasonable efforts to develop and commercialize neffy in Japan. The parties agreed to share the cost of any additional clinical studies required for approval of neffy in Japan. Alfresa is solely responsible for regulatory and commercialization activities and may elect to assume responsibility for manufacturing and supplying drug product for commercial use in Japan. Either party may terminate the agreement for certain breaches of the Alfresa Agreement. Unless terminated earlier by either or both parties, the term of the agreement will continue until the later of (i) expiration of the last-to-expire patent in Japan; or (ii) 10 years after the first commercial sale of neffy in Japan.

In December 2025, in connection with the Alfresa Agreement, the Company also entered into a commercial supply agreement (the “Alfresa Supply Agreement”) with Alfresa, under which ARS will supply Alfresa’s requirements (and Alfresa will purchase from ARS its requirements) for a transfer price in the low-double-digit percentage on net sales of neffy in Japan. The Alfresa Supply Agreement is coterminous with the Alfresa Agreement. Either the Company or Alfresa may terminate the Alfresa Supply Agreement in the event of an uncured material breach of the other party. Pursuant to the Alfresa Agreement, at any time, Alfresa may elect to manufacture its own supply of drug product. In the event Alfresa elects to do so, Alfresa is obligated to pay the Company a royalty payment on the net sales of drug product in the Alfresa Territory in an amount equal to monetary value the Company would receive by supplying drug product to Alfresa at the transfer price. The promises under the Alfresa Supply Agreement did not meet the definition of a performance obligation nor did these promises convey a material right to Alfresa.

At inception of the Alfresa Agreement, the Company identified the following performance obligations: (i) the license for neffy; and (ii) research and development services, both of which have been satisfied. The initial transaction price was $7.0 million, which included the upfront payment of $2.0 million and a regulatory milestone of $5.0 million that was deemed not probable of significant reversal at the inception of the Alfresa Agreement. Variable consideration related to future milestone payments was fully constrained at inception and excluded from the transaction price until a significant revenue reversal is no longer probable. The transaction price was allocated to performance obligations based on their estimated stand-alone selling prices.

As of March 31, 2026, the Company has earned an aggregate of $15.0 million for the upfront payment and achievement of regulatory and commercial milestones, and there are no remaining regulatory or commercial milestone payments under the Alfresa Agreement. The Company is also entitled to receive a transfer price in the low double-digit percentage on future net sales of neffy in Japan.

For the three months ended March 31, 2026 and 2025, no revenue was earned under the Alfresa Agreement.

Recordati Agreement

In September 2020, the Company entered into a License and Supply Agreement (the “Recordati Agreement”) with Recordati Ireland, Ltd. (“Recordati”) for the exclusive license and sublicensable right to develop, import, manufacture or have manufactured commercial product, file and hold regulatory approvals and commercialize neffy in Europe and certain European Free Trade Association, Russia/the Commonwealth of Independent States, Middle East and African countries (the “Recordati Territory”). Under the Recordati Agreement, the Company received an upfront payment of $11.8 million and a regulatory milestone payment of $6.0 million in 2020.

In February 2023, the Company and Recordati entered into a termination agreement (the “Recordati Termination Agreement”), pursuant to which, among other things, the Company and Recordati agreed to terminate the Recordati Agreement. Pursuant to the Recordati Termination Agreement, the Company reacquired all of the Recordati Rights, paid Recordati a one-time upfront payment of €3.0 million ($3.3 million in U.S. dollars), and agreed to pay additional payments upon achievement of certain milestones including: (i) an EMA regulatory milestone payment of €2.0 million, (ii) a milestone payment of €5.0 million upon first commercial sale of neffy in the Recordati Territory, and (iii) royalty payments of up to €5.0 million in the aggregate from sales of neffy in the Recordati Territory (collectively, the “Recordati Rights”).

The Company determined that the Recordati Rights at the time of entering into the Recordati Termination Agreement had no alternative future use and therefore recorded the €3.0 million upfront payment to Recordati as an in-process research and development (“IPR&D”) expense presented within research and development expense. The Recordati Termination Agreement ended the Company’s performance obligations pursuant to the Recordati Agreement and consequently the existing contract liability of $3.1 million previously received from Recordati was recorded against IPR&D expense presented within research and development expense in the consolidated statements of operations for the year ended December 31, 2023. Accordingly, no revenue has been recognized subsequent to the Recordati Termination Agreement.

In June 2024, the EMA regulatory milestone was met and a €2.0 million ($2.1 million in U.S. dollars) expense was recorded in research and development expense in the consolidated statements of operations and comprehensive loss during the year ended December 31, 2024. In June 2025, the first commercial sale milestone was met for the first commercial sale of neffy in the Recordati Territory. As a result, the Company capitalized the €5.0 million ($5.9 million in U.S. dollars) milestone for the first commercial sale of neffy in the Recordati Territory to intangible assets in the accompanying condensed consolidated balance sheets. The intangible assets will be amortized through cost of goods sold in the accompanying condensed consolidated statements of operations and comprehensive loss on a straight-line basis over the estimated life of the intellectual property of 13.5 years.

For the three months ended March 31, 2026, the Company recognized less than $0.1 million in royalty expense from the sale of neffy in the Recordati Territory, as cost of goods sold in the accompanying condensed consolidated statements of operations and comprehensive loss. No royalty expense was recognized for the three months ended March 31, 2025.

Pediatrix Agreement

In March 2021, the Company entered into a collaboration and distribution agreement (the “Pediatrix Agreement”) with Pediatrix Therapeutics, Inc. (“Pediatrix”) for the exclusive license and sublicensable right to develop, import, manufacture or have manufactured commercial product, file and hold regulatory approvals and commercialize neffy in the People’s Republic of China, Taiwan, Macau, and Hong Kong (the “Pediatrix Territory”). Under the Pediatrix Agreement, Pediatrix is responsible, at its sole cost and expense, for all ongoing development work that is necessary for or otherwise supports regulatory approval in the Pediatrix Territory, including all clinical trials, and activities related to post-approval commitments and commercialization tests. In addition, Pediatrix is responsible for commercialization activities and may elect to assume responsibility for manufacturing and supplying drug product for commercial use. The Company is responsible for the manufacturing of product for clinical studies as well as commercial supply, all at a negotiated transfer price. Either party may terminate the Pediatrix Agreement for certain breaches of the agreement. Unless terminated earlier by either or both parties, the term of the agreement will continue until the later of (i) expiration of the last-to-expire patent in the Pediatrix Territory, (ii) the expiration of all regulatory exclusivities that cover neffy in the Pediatrix Territory, or (iii) 10 years after the first commercial sale of neffy in the Pediatrix Territory.

In January 2026, in connection with the Pediatrix Agreement, the Company also entered into a commercial supply agreement (the “Pediatrix Supply Agreement”) with Pediatrix, under which ARS will supply Pediatrix’s requirements (and Pediatrix will purchase from ARS its requirements) for a specified price. The Pediatrix Supply Agreement is coterminous with the Pediatrix Agreement. Either the Company or Pediatrix may terminate the Pediatrix Supply Agreement in the event of an uncured material breach of the other party. The promises under the Pediatrix Supply Agreement do not meet the definition of a performance obligation, nor did these promises convey a material right to Pediatrix.

At inception of the Pediatrix Agreement, the Company identified the performance obligations as the delivery of the license for neffy in the Pediatrix Territory, which has been satisfied. The initial transaction price was $3.0 million, which includes the upfront payment received at the inception of the Pediatrix Agreement. Variable consideration related to future milestone payments was fully constrained at inception and excluded from the transaction price until a significant revenue reversal is no longer probable. The transaction price was wholly allocated to the performance obligation, and variable consideration is reassessed each reporting period.

As of March 31, 2026, the Company has earned an aggregate of $7.0 million for the upfront payment and achievement of regulatory and commercial milestones and is eligible to receive up to $80.0 million in sales-based milestone payments. There are no regulatory or commercial milestones remaining under the Pediatrix Agreement. Since receiving regulatory approval in the Pediatrix Territory, the Company is also entitled to tiered royalties in the low double-digits on future net sales in the Pediatrix Territory and will receive a per unit supply price for commercial supply sold to Pediatrix under the Pediatrix Supply Agreement.

For the three months ended March 31, 2026 and 2025, no revenue was earned under the Pediatrix Agreement.

Seqirus Agreement

In March 2024, the Company entered into a license and distribution (the “Seqirus Agreement”) with Seqirus Pty Ltd. (“Seqirus”), which was amended in December 2025, for the exclusive license to commercialize neffy in Australia and New Zealand (the “Seqirus Territory”). Under the Seqirus Agreement, the Company is responsible for the transfer of know-how, which includes regulatory materials, regulatory data, and commercialization data, and also for the manufacturing of product for commercial supply which is available to Seqirus at a negotiated price. Seqirus is solely responsible for all regulatory and commercialization activities in the Seqirus Territory. Either party may terminate the Seqirus Agreement for certain breaches. Unless terminated earlier by either or both parties, the initial term of the Seqirus Agreement is 15 years from the first commercial sale of neffy in the Seqirus Territory. The Seqirus Agreement will automatically renew for two-year periods unless either party gives a notice to terminate at least 12 months prior to the end of the initial or any renewal term.

At inception of the Seqirus Agreement, the Company identified a single performance obligation: the delivery of the license for neffy in the Seqirus Territory in combination with the transfer of know-how, which has been satisfied. The license and know-how were considered distinct from potential supply obligations, which are effectively options for Seqirus to purchase commercial supply and do not represent a material right. The initial transaction price was $0.5 million, which includes the upfront payment received at the inception of the Seqirus Agreement. Variable consideration related to future milestone payments was fully constrained at inception and excluded from the transaction price until a significant revenue reversal is no longer probable. The transaction price was wholly allocated to the performance obligation, and variable consideration is reassessed each reporting period.

As of March 31, 2026, the Company has earned an aggregate of $2.6 million for the upfront payment and achievement of regulatory and commercial milestones and is eligible to receive up to $2.3 million in remaining regulatory and commercial milestones. Since receiving approval in the Seqirus Territory, the Company is also entitled to receive a per unit supply price for commercial supply sold to Seqirus.

For the three months ended March 31, 2026 and 2025, no revenue was earned under the Seqirus Agreement.

ALK Collaboration Agreement

In November 2024, the Company entered into a collaboration, license and distribution agreement (the “ALK Collaboration Agreement”) with ALK-Abelló A/S (“ALK”). Pursuant to the ALK Collaboration Agreement, the Company granted to ALK a worldwide (other than the United States, Japan, mainland China, Hong Kong, Taiwan, Macau, Australia and New Zealand) (“ALK Territory”), exclusive license under certain of the Company’s patents and know-how to develop, manufacture and commercialize products containing epinephrine administered intranasally, including EURneffy (the trade name for neffy in the European Union) (epinephrine nasal spray) (“Products”), for all human uses, including the immediate or emergency treatment of allergic reactions (including Type I) and anaphylaxis and urticaria, and other future indications as agreed by the parties. If the Company develops any new intranasally administered product that contains epinephrine and files a new drug application in the United States for such product (“New Product”), upon ALK’s request such New Product will be included as a Product under the ALK Collaboration Agreement, subject to ALK bearing the costs of development of such New Product for its licensed territory.

Under the ALK Collaboration Agreement, the Company is obligated to transfer to ALK the existing marketing authorizations for the Products in the ALK Territory. The Company is also required to conduct certain development and regulatory activities for Products in support of obtaining further regulatory approval of Products in the ALK Territory, and will transfer such regulatory approvals to ALK. ALK is obligated to use commercially reasonable efforts to obtain and maintain regulatory approval for Products through the European Commission and within specified countries within the ALK Territory. Following such approval for a Product in each indication within specified countries within the ALK Territory, ALK is obligated to use commercially reasonable efforts to commercialize such Product in such indication in such countries and to achieve the first commercial sale of a Product in certain countries in accordance with a timeline specified in the ALK Collaboration Agreement.

Under the ALK Collaboration Agreement, ALK made a $145.0 million upfront payment to the Company, and the Company earned $10.0 million for the achievement of regulatory and commercial milestones. The Company is eligible to receive remaining regulatory milestone payment of $10.0 million and sales-based milestone payments of up to $300.0 million. The Company is entitled to receive tiered royalty payments on net sales in the mid- to high-teens, subject to certain standard reductions and offsets. Royalties will be payable, on a Product-by-Product and country-by-country basis, until the latest of the expiration of the licensed patents covering such Product in such country, 15 years from first commercial sale of such Product in such country, or expiration of regulatory exclusivity for such Product in such country.

The contract will expire upon the expiration of the last to expire royalty term for all Products in the ALK Territory, unless terminated earlier. Either the Company or ALK may terminate the ALK Collaboration Agreement in the case of the other party’s insolvency or in the event of an uncured material breach of the other party, except that the Company may not terminate the ALK Collaboration Agreement for ALK’s material breach of its commercial diligence obligations. ALK may terminate the ALK Collaboration Agreement for convenience upon 12 months’ prior written notice or for a safety or regulatory concern. The Company may terminate the ALK Collaboration Agreement in the event ALK makes certain challenges to certain of the Company’s patents. Prior to a change of control and outside of a set period of time after which the Company commences change of control negotiations, the Company may terminate the ALK Collaboration Agreement with respect to all countries in the European Economic Area (“EEA”) upon prior written notice to ALK and payment of a termination fee that is the higher of an agreed mid-nine digit amount and the fair market value of the Products business in the EEA at the time of such termination (the “Repurchase Option”). The Company may also terminate the ALK Collaboration Agreement if ALK commercializes a non-injectable epinephrine product or manufactures such a product in the United States.

In connection with the ALK Collaboration Agreement, the Company and ALK also entered into a commercial supply agreement (the “ALK Supply Agreement”) in November 2024, which was amended in March 2026, under which the Company will supply ALK’s requirements (and ALK will purchase from the Company its requirements) of Products for five years for a specified supply price, after which ALK may elect to transition to itself or its contract manufacturer the manufacture and supply of Products. The contract term for the ALK Supply Agreement is coterminous with the ALK Collaboration Agreement. Either the Company or ALK may terminate the ALK Supply Agreement in the event of an uncured material breach of the other party.

Accounting Assessment

The Company concluded that the ALK Collaboration Agreement and the ALK Supply Agreement qualify as a contract with a customer under ASC 606 as one combined arrangement. The Company identified the following performance obligations: (i) exclusive commercialization license in the European Economic Area (the “EEA License”); (ii) exclusive commercialization license in the rest of the ALK Territory (the “ROW License”) and; (iii) five separate development and regulatory services performance obligations. The Company also evaluated the (i) promise to add a New Product and new indications to the ALK Collaboration Agreement, and (ii) the promises under the ALK Supply Agreement, and concluded that these promises did not meet the definition of a performance obligation nor did these promises convey a material right to ALK.

The Company determined that the non-refundable upfront payment of $145.0 million is the estimated transaction price at contract inception. The regulatory and commercial milestone payments (totaling $20.0 million) were fully constrained at contract inception due to the uncertainty of whether any of the milestones will be achieved. In making the assessment of the constraint utilizing the most likely amount method, the Company considered the stage of development, and the risks associated with the remaining development required to achieve the milestones, as well as whether the achievement of the milestone is outside the control of the Company or ALK. The Company determined that the regulatory and commercial milestones, sales-based milestones, and royalties will be recognized on the later of when the related sales occur or when control of the associated license has been transferred, as the Company determined that such sales-based consideration relates predominantly to the licenses granted to ALK. The Company reevaluates the transaction price at the end of each reporting period and as uncertain events are resolved or other changes in circumstances occur and will include regulatory milestones in the transaction price if it is probable that a significant revenue reversal will not occur in future periods.

At contract inception, the Company determined the estimated standalone selling prices for each performance obligation in order to allocate the transaction price among the performance obligations. The standalone selling price for the licenses was estimated using the adjusted market assessment approach. Under this method, the Company forecasted future cash flows expected in the ALK Territory, the probability of commercialization success, and a market discount rate. To estimate the standalone selling prices of the development and regulatory services, the Company forecasted its expected costs of satisfying each performance obligation inclusive of an appropriate margin for that service.

The Company allocated the total transaction price to each performance obligation on a relative standalone selling price basis and determined whether revenue should be recognized at a point in time or over time. The Company allocated $69.4 million to the EEA License performance obligation; $73.1 million to the ROW License performance obligation; and $2.6 million to the development and regulatory services performance obligations.

As of March 31, 2026, the Company has earned an aggregate of $155.0 million in milestone payments for the upfront payment and achievement of regulatory and commercial milestones, of which $74.2 million has been allocated to the EEA License and is accounted for as a financing liability. The Company is eligible to receive remaining regulatory milestone payments of up to $10.0 million and sales-based milestone payments of up to $300.0 million as well as tiered royalties on net sales in the mid- to high-teens, subject to customary reductions and offsets. Royalties are payable on a Product-by-Product and country-by-country basis until the latest of: (i) the expiration of the licensed patents covering such Product in such country; (ii) 15 years from the first commercial sale of such Product in such country; or (iii) expiration of regulatory exclusivity for such Product in such country. The Company is also eligible to receive a per unit supply price for commercial supply sold to ALK under the ALK Supply Agreement.

The Company earned the $5.0 million regulatory milestone during the three months ended March 31, 2026, of which $2.5 million was recognized as revenue under collaboration agreements in the accompanying condensed consolidated statements of operations and comprehensive loss. The remaining $2.5 million was allocated to the development and regulatory performance obligations and EEA license and recognized as increases to the contract liability and financing liability, respectively. For three months ended March 31, 2026 and 2025, the Company recognized revenue of less than $0.1 million and $0.2 million for the performance of development and regulatory services in the accompanying condensed consolidated statements of operations and comprehensive loss.

Contract Liability

The development and regulatory services performance obligations under the ALK Collaboration Agreement each represent a separate performance obligation. The development and regulatory services, which are transferred to the customer over time, were provided to ALK beginning at the inception of the ALK Collaboration Agreement and are expected to continue through 2028. Development and regulatory service performance obligations were initially recorded as contract liabilities, and revenue earned under these performance obligations is recognized as services are performed based on the costs incurred through the end of each reporting period as a percentage of the estimated total costs to be incurred for these performance obligations.

Financing Liability

As discussed above, the Company retains a substantive Repurchase Option for the EEA License, which prevents control from transferring to ALK under ASC 606. As a result, the consideration allocated to the EEA License is accounted for as a financing liability because the repurchase price exceeds the original selling price and will remain outstanding until the Repurchase Option lapses or is exercised. Commercial and sales-based milestones allocated to the EEA License are recognized as increases to the financing liability when earned.

ALK Co-Promotion Agreement

In May 2025, the Company and ALK-Abelló, Inc. (“ALK U.S.”, an affiliate of ALK) entered into a co-promotion agreement, which was subsequently amended in October 2025 and March 2026 (the “ALK Co-Promotion Agreement”), to co-promote neffy to over 10,000 specified pediatricians and other prescribers in the U.S. Accordingly, the Company granted ALK U.S. a non-exclusive, royalty-free license to use the neffy trademarks and copyrights and the ARS house marks in the U.S. solely in connection with promoting neffy pursuant to the terms of the ALK Co-Promotion Agreement.

Under the ALK Co-Promotion Agreement, ALK U.S. commenced its promotion activities in May 2025 and is obligated to meet specified ramp-up milestones and minimum detail requirements using sales representatives that meet specific qualifications. In addition, during the term of the ALK Co-Promotion Agreement and for 180 days thereafter, ALK U.S. will not market, sell or manufacture any injection product containing epinephrine in the U.S.

The Company is the principal of all sales transactions of neffy in the U.S. and, subject to the terms of the ALK Co-Promotion Agreement, continues to have sole responsibility for all U.S. commercialization activities, including marketing, medical affairs, market access, production, distribution, pharmacovigilance, quality and safety.

The Company will pay ALK U.S. a base fee to compensate ALK U.S. for its promotion activities. Payments to ALK U.S. for the services performed during the first year of the arrangement will be deferred and paid in the second year of the arrangement. In addition to the base fee, ALK U.S. will be eligible to receive performance-based bonus payments from the Company starting in the second year of the arrangement equal to 30% of the portion of neffy net sales generated from the ALK U.S.-targeted prescribers in excess of a specified initial market share threshold in year two or a 50% market share threshold during years three and four of the arrangement.

The ALK Co-Promotion Agreement expires on the fourth anniversary of the commencement of promotion activities thereunder. Either party may terminate the ALK Co-Promotion Agreement in the event of an uncured material breach of the other party or for either party’s change of control. The Company may terminate the ALK Co-Promotion Agreement in the case of ALK U.S.’s insolvency, if ALK U.S. fails to meet specified ramp-up timelines, or if ALK U.S. markets, sells or commercializes any non-injection product containing epinephrine in the U.S. After the first six months, the Company may terminate the ALK Co-Promotion Agreement if minimum detail requirements are not met for a consecutive three-month period. After the first year, the Company may terminate the ALK Co-Promotion agreement for any reason or no reason for a fee (as described below). After the first year, ALK U.S. may terminate the ALK Co-Promotion Agreement for any reason or no reason, and the Company may terminate the agreement in the event ALK U.S. restructures its sales force.

Upon termination of the ALK Co-Promotion Agreement by the Company for convenience, so long as ALK U.S. has met specified performance thresholds during the term, the Company is obligated to pay ALK U.S. a specified mid-to-low double-digit percentage of the portion of neffy net sales generated from the ALK U.S.-targeted prescribers in excess of a specified mid-quartile market share threshold that increases over time up to 50% for a specified period after termination, which period decreases in duration the later that the termination occurs. Upon termination of the ALK Co-Promotion Agreement by the Company in connection with a change of control of the Company, the Company is obligated to pay ALK U.S. a one-time mid-seven digit to low eight-digit termination fee in an amount that increases the later that the termination occurs.

The Company evaluated the terms of the ALK Co-Promotion Agreement and concluded that it represents a vendor arrangement with ALK U.S. During the three months ended March 31, 2026, the Company recognized $2.8 million in ALK-related selling, general, and administrative expense in the accompanying condensed consolidated statements of operations and comprehensive loss, and the corresponding liability was recorded in accounts payable and accrued liabilities and other accrued liabilities in the accompanying condensed consolidated balance sheet as of March 31, 2026.