3. LICENSE AND COLLABORATION AGREEMENTS

Arrowhead Pharmaceuticals, Inc.

In November 2024, the Company and Arrowhead Pharmaceuticals, Inc. (“Arrowhead”) entered into an exclusive global license and collaboration agreement and a stock purchase agreement (collectively, the “Arrowhead Collaboration Agreement”) that subsequently became effective as of February 7, 2025 (the “Effective Date”).

The Arrowhead Collaboration Agreement granted the Company an exclusive license under certain of Arrowhead’s intellectual property rights to develop, manufacture and commercialize the lead candidate (and all backup candidates) for the programs listed below. The following table summarizes the current development stage of each program:

In addition, the parties will collaborate on the discovery and development of compounds that are directed to six targets to be selected by the Company during the term (each an “Arrowhead Discovery Program,” and together with the Arrowhead Clinical Programs and Pre-clinical Programs, the “Arrowhead Programs”).

Under the terms of the Arrowhead Collaboration Agreement, Arrowhead will conduct development activities with respect to the Arrowhead Programs pursuant to agreed-upon development plans. At pre-determined transition points for each Arrowhead Program, Arrowhead will transfer development responsibility to the Company, who will then perform all development activities necessary to obtain and maintain regulatory approvals throughout the world. The Company will have the sole worldwide right to commercialize licensed products.

Upon the effectiveness of the Arrowhead Collaboration Agreement, the Company paid Arrowhead an up-front payment of $500.0 million and invested $325.0 million in approximately 11.9 million shares of Arrowhead's common stock at a premium to the valuation on the closing date. On the Effective Date:

The Company will reimburse Arrowhead for certain pre-determined development activities for the Arrowhead Clinical Programs. Each party is responsible for the costs and expenses of other development activities under the Arrowhead Collaboration Agreement. Arrowhead will complete all manufacturing activities necessary for their development activities and provide clinical supply for all Arrowhead Programs and commercial supply for the Arrowhead Clinical Programs. For the three and six months ended June 30, 2026, the Company recorded $6.3 million and $14.8 million, respectively, of research and development expense related to reimbursable development costs incurred by Arrowhead. For the three and six months ended June 30, 2025, the Company recorded $6.5 million and $8.8 million, respectively, of research and development expense related to reimbursable development costs incurred by Arrowhead.

Additionally, the Company will pay Arrowhead an aggregate total of $250.0 million in annual installments of $50.0 million over five years (“Annual Collaboration License Fees”), with the first payment due on the first anniversary of the Effective Date. The Annual Fees are contingent upon the Company not terminating the Arrowhead Collaboration Agreement. For the six months ended June 30, 2026, the Company paid and recorded the first $50.0 million Annual Collaboration License Fee in research and development expense in the unaudited condensed consolidated statements of comprehensive (loss) income. Over the term of the Arrowhead Collaboration Agreement, the Company may be obligated to make payments to Arrowhead totaling up to $10.3 billion upon the achievement of certain development, regulatory and sales milestones, inclusive of two milestones associated with the continued enrollment of certain cohorts of a Phase 1/2 study for the DM1 program (the "Arrowhead DM1 Milestones"), totaling $300.0 million, both of which were achieved and recognized during the year ended December 31, 2025. During the six months ended June 30, 2026, the Company paid $200.0 million in cash related to the second Arrowhead DM1 Milestone, which was included in accounts payable as of December 31, 2025. For details about the Arrowhead DM1 Milestones, please read Note 3, License and Collaboration

Agreements of the Annual Report on Form 10-K for the year ended December 31, 2025. Furthermore, upon commercialization, the Company will be required to make tiered royalty payments based on net sales.

F. Hoffmann-La Roche Ltd.

For the six months ended June 30, 2026, the Company recognized $365.0 million of collaboration revenue associated with the license, collaboration and option agreement (the “Roche Collaboration Agreement”) with F. Hoffmann-La Roche Ltd. (“Roche”), with no collaboration revenue recognized during the three months ended June 30, 2026. For the three and six months ended June 30, 2025, the Company recognized $63.5 million and $175.5 million, respectively, of collaboration revenue associated with the Roche Collaboration Agreement. Under the Roche Collaboration Agreement, the Company granted Roche options to acquire ex-U.S. rights to certain future Duchenne development programs (the “Options”) in exchange for separate option exercise payments, milestone and royalty considerations and cost-sharing provisions. These Options were accounted for as material rights related to individual programs and recorded in deferred revenue at the inception of the Roche Collaboration Agreement. The value assigned to the material rights is included in deferred revenue until such rights expire or are exercised.

In February 2026, Roche declined to exercise an Option for certain program rights, which resulted in the immediate recognition of $325.0 million of collaboration revenue during the six months ended June 30, 2026. Additionally, Roche dosed the first commercial patient in Japan during the six months ended June 30, 2026, which resulted in the recognition of a $40.0 million milestone payment as collaboration revenue under the Roche Collaboration Agreement.

In June 2025, the Company received a milestone payment of $63.5 million in connection with the receipt of regulatory approval of ELEVIDYS in Japan for individuals ages 3- to less than 8-years-old, who do not have any deletions in exon 8 and/or exon 9 in the Duchenne gene and who are negative for anti-AAVrh74 antibodies. The milestone payment was included in collaboration and other revenues for the three and six months ended June 30, 2025. In February 2025, an Option for a certain program expired, which resulted in the immediate recognition of $112.0 million of collaboration revenue for the six months ended June 30, 2025.

In accordance with the Roche Collaboration Agreement, the parties agreed to enter into a supply agreement in order to supply them with clinical and commercial batches of ELEVIDYS (the “Roche Supply Agreement”). Roche utilizes the supply for sales of ELEVIDYS in territories outside of the U.S. where Roche has received certain approvals for ELEVIDYS. While the Roche Supply Agreement is in the process of being negotiated, the Company has delivered commercial ELEVIDYS supply to Roche that is agreed upon on a purchase order-by-purchase order basis. Contract manufacturing revenue and royalty revenue are included in collaboration and other revenues in the unaudited condensed consolidated statements of comprehensive (loss) income. During the three and six months ended June 30, 2026, Roche product cost of sales exceeded Roche contract manufacturing revenue as a portion of write-offs of certain batches of ELEVIDYS that did not meet quality specifications in the period, the Company's reserve for obsolete ELEVIDYS inventory on hand and scrapped and expired materials were allocated to Roche product cost of sales. The following table summarizes certain Roche activity for each of the periods indicated:

The costs associated with co-development activities performed under the Roche Collaboration Agreement are included in operating expenses, with any reimbursement of costs by Roche reflected as a reduction of such expenses when the related expense is incurred. For the three and six months ended June 30, 2026, costs reimbursable by Roche and reflected as a reduction to operating expenses were $7.2 million and $15.4 million, respectively. For the three and six months ended June 30, 2025, costs reimbursable by Roche and reflected as a reduction to operating expenses were $25.7 million and $54.2 million, respectively. As of June 30, 2026 and December 31, 2025, there was $45.0 million and $104.1 million of collaboration and other receivables included in other current assets on the unaudited condensed consolidated balance sheets, respectively.

As of June 30, 2026 and December 31, 2025, the Company had total deferred revenue of $220.3 million and $527.3 million, of which $110.1 million and $443.4 million are classified as current, respectively. As of June 30, 2026 and December 31, 2025, all of the deferred revenue related to the Roche Collaboration Agreement and Roche Supply Agreement.

Milestone Obligations

Including the Arrowhead Collaboration Agreement, the Company has license and collaboration agreements in place for which it could be obligated to pay, in addition to the payment of up-front fees upon execution of the agreements, certain milestone payments as a product candidate proceeds from the submission of an investigational new drug application through approval for commercial sale and beyond. As of June 30, 2026, the Company may be obligated to make up to $12.1 billion of future development, regulatory, commercial and up-front royalty payments associated with its collaboration and license agreements.