6. Research and Collaboration Arrangements

An immaterial amount of revenue was recorded during the six months ended June 30, 2026 and 2025 which was included in deferred revenue at January 1, 2026 and 2025, respectively, for Cystic Fibrosis Foundation.

Cystic Fibrosis Foundation (“CFF”)

In September 2016, the Company entered into an award agreement for the Optimized Adeno-Associated Virus for Lung Epithelia Gene Delivery Development Program with CFF, a non-profit organization dedicated to finding a cure for cystic fibrosis, an inherited disorder that causes disease in the pulmonary airways leading to morbidity and mortality. Under this agreement, CFF contributes funding to help advance the Company’s cystic fibrosis research program. The September 2016 grant award agreement was incorporated into a new grant award agreement with CFF in September 2017 with the same objectives, which was subsequently amended in August 2018 and February 2021. In August 2023, the Company executed a third amendment to the agreement (the “August 2023 Amendment”), which modified the research plan, increased the aggregate milestone payments from $3.5 million to $6.3 million and extended the estimated project completion date. The aforementioned September 2017 agreement and three amendments are collectively referred to as the “CFF Agreement”. The August 2023 Amendment represents a contract modification to an existing contract under ASC Topic 606, given the amendment did not include any additional goods or services, and the remaining research activities are not distinct from those previously provided. The August 2023 Amendment did not impact the transaction price, given the increased award amount relates to variable consideration for future milestones that are fully constrained. Accordingly, the contract modification did not result in a revenue adjustment. As of June 30, 2026 and December 31, 2025, the Company had achieved cumulative milestones totaling $1.8 million under the CFF Agreement. The remaining award amount will be paid by CFF based on achievement of certain development milestones by the Company.

The Company expects to make payments to CFF equal to six times the actual award received by the Company in three installments within the first four years of the first commercial sale of a product developed under this agreement. The Company also has agreed to make future sales-based milestone payments to CFF of up to three times the actual award received upon achieving specified commercialization milestones with respect to the first of any product developed utilizing any compound covered under the CFF Agreement. The CFF Agreement also requires the Company to pay to CFF royalties of a mid-single digit percentage, up to six times the actual award received, on any amounts received by the Company from the sale, license or transfer to a third-party of rights in the technology developed as a result of this collaboration. Any such royalty payments shall be credited against the payments owed by the Company upon first commercial sale. In the event of a change of control of the Company, CFF will receive certain payments, depending on the timing of the change of control and the size of the transaction.

To date, the Company has not developed a commercial product in connection with the CFF Agreement, and it has not licensed, sold or otherwise transferred to another party the product developed under the CFF Agreement or the underlying technology.

If at any time prior to the first commercial sale of a product developed as a result of the CFF Agreement, the Company ceases to use commercially reasonable efforts to develop or commercialize any product under the CFF Agreement for a continuous period of 180 consecutive days and fails to present a reasonable plan to resume commercially reasonable efforts, the Company will grant to CFF an irrevocable, exclusive worldwide interruption license under all of the Company’s interest in the research plan technology to exploit such product. Any third-party license granted by the Company shall be subject to such interruption license.

The Company identified one performance obligation within the CFF Agreement for research activities. The CFF Agreement does not include a significant financing component.

The Company concluded that the transaction price should not include the variable consideration related to future research milestones as they were considered to be constrained as it is probable that the inclusion of such variable consideration could result in a significant reversal of cumulative revenue in the future. The Company re-evaluates the transaction price and estimated period of performance at each reporting period.

Revenue recognized during the three and six months ended June 30, 2026 was $0.1 million and $0.2 million, respectively, while revenue recognized during the three and six months ended June 30, 2025 was immaterial. As of June 30, 2026 and December 31, 2025, deferred revenue relating to the CFF Agreement was $0.9 million and $1.1 million, respectively. There were no accounts receivable from CFF under the CFF Agreement as of June 30, 2026 and December 31, 2025. As of June 30, 2026 and December 31, 2025, the aggregate amount of the transaction price allocated to the remaining performance obligation was $0.9 million and $1.1 million, respectively. Based on current timelines, the deferred revenue is expected to be recognized as revenue over the next four years as the Company performs research services through the completion of IND-enabling studies.

The obligation to make payments to CFF upon a change of control meets the definition of an embedded derivative that is required to be bifurcated and separately accounted for as a derivative liability. See Note 3, Fair Value Measurements and Marketable Securities, and Note 16, Derivative Liability, for further discussion of the embedded derivative.

Otsuka Pharmaceutical Co., Ltd.

On October 31, 2025, the Company entered into a Collaboration and License Agreement (the "Otsuka Agreement") with Otsuka. Pursuant to the Otsuka Agreement, the Company granted Otsuka an exclusive royalty-bearing sublicensable license to its intellectual property to develop, manufacture and commercialize 4D-150, its lead product candidate for ophthalmological diseases, in Japan, Korea, China, Australia, and certain other Asia-Pacific markets ("Otsuka Territory"). The Company retains full development and commercialization rights for 4D-150 outside the Otsuka Territory, including the United States, Latin America, and Europe.

Otsuka will lead all regulatory and commercialization activities in the Otsuka Territory. The Company will lead all Phase 3 clinical activity globally, including within the Otsuka Territory. In aggregate, the Company is currently responsible for separate global phase 3 trials for wet age-related macular degeneration ("wet AMD") and diabetic macular edema (“DME”), local clinical trials in the Otsuka Territory as required by local regulatory authorities, and several other studies, including the related regulatory activities and long-term follow up studies. The Company and Otsuka will coordinate and review the development and other activities through a joint steering committee.

The Company also will manufacture and supply 4D-150 to Otsuka for clinical and commercial use at a supply price derived from the Company's manufacturing costs plus a margin.

The Company has received a nonrefundable upfront cash payment of $85.0 million and is eligible to receive quarterly clinical trial cost sharing and reimbursement amounts. In addition, the Company is eligible for up to $335.5 million in potential regulatory and commercial milestone payments and tiered double-digit royalties on net sales in the Otsuka Territory, and subject to royalty reductions under certain circumstances.

The Otsuka Agreement will remain in effect, unless earlier terminated, on a country-by-country basis, until the date that Otsuka is no longer developing or commercializing 4D-150 in such country within the Otsuka Territory. Otsuka may terminate the Otsuka Agreement for convenience, on a country-by-country basis, upon sufficient prior written notice as per the Otsuka Agreement, or due to safety reasons or the failure of certain of the Company’s related clinical trials to achieve their primary endpoints. The Company may terminate the Otsuka Agreement upon notice if Otsuka ceases all development activities and commercialization of 4D-150 in Japan for an agreed upon period as per the Otsuka Agreement and does not resume such activities or commercialization within a specified notice period. Upon termination, any license granted by the Company to Otsuka will terminate.

The Company concluded that Otsuka is a customer and that the arrangement represents a contract with a customer under the scope of ASC 606. The Company identified the following promised goods and services that represent performance obligations:

The license was considered functional intellectual property as of the inception of the Otsuka Agreement and distinct from other promises under the contract, as Otsuka can benefit from the license on its own or together with other readily available resources. Each of the clinical trial and other study services were considered distinct as the customer can benefit from these services together with the license transferred at the inception of the Otsuka Agreement. The clinical trial and other study services will not modify or customize the initial intellectual property transferred at contract inception due to the late stage of development of the intellectual property.

The Company concluded manufacturing and supply of 4D-150 for clinical and commercial use does not represent a performance obligation, as these activities are at Otsuka’s option. Product supply is priced at standalone selling prices, and therefore does not provide Otsuka with material rights.

To the extent Otsuka requests the Company to supply 4D-150, such supply will be considered a separate contract with the customer.

The initial transaction price includes the upfront cash payment and variable consideration for clinical trials and other studies performance obligations, some of which have started and others that have not yet started as of June 30, 2026. The upfront cash payment is $85 million and was received during the year ended December 31, 2025. The variable consideration in the form of the estimated cost sharing and reimbursement of approximately $33.4 million represents the amount allocated to unsatisfied or partially unsatisfied performance obligations, that have already started as of June 30, 2026, and was allocated entirely to the clinical trials and other studies performance obligations using the variable consideration allocation exception.

The regulatory milestone amounts are not currently probable and have not been included in the transaction price as the amounts are fully constrained. The sales-based commercial milestones and royalties relate to the granted intellectual property license and will be recognized when the related sales occur.

At the end of each reporting period, the Company will re-evaluate the estimated variable consideration and if necessary, adjust the transaction price.

To determine the standalone selling prices of each performance obligation, the Company used significant estimates and assumptions that include but are not limited to, expected market opportunity and pricing, expected future costs of clinical trials and other studies, and timelines and likelihood of success of clinical and regulatory activities. For the standalone selling price of the license, the Company used a discounted cash flow analysis of projected cash flows and potential revenues from the commercial sales of 4D-150 in the Otsuka Territory. To determine the standalone selling prices of the Company’s obligations to conduct clinical trials and other studies, the expected cost plus margin approach was used.

Variable consideration to which the Company is entitled to is allocated directly to the associated performance obligations, as it is triggered by the Company’s performance or represents specific outcomes from such performance, and the resulting allocation meets the allocation objective.

The upfront amount of $85.0 million was allocated entirely to the license performance obligation and was recognized at a point in time upon the transfer of control during the year ended December 31, 2025.

Revenue attributable to the remaining performance obligations to conduct clinical trials and other studies will be recognized over time as the underlying services are performed, over the period through the completion of program development activities. Progress is measured using an input method based on cumulative cost incurred relative to the total estimated cost of the performance obligation. Estimated progress and the underlying costs will be reviewed and adjusted as necessary at every reporting date. Revenue from clinical trials and other studies performance obligations was approximately $3.7 million and $6.6 million during the three and six months ended June 30, 2026, respectively.

The transaction price amount allocated to unsatisfied or partially unsatisfied performance obligations as of June 30, 2026 was approximately $33.4 million, expected to be recognized during 2026 through 2032 as clinical trials and other studies continue. Certain performance obligations have not started as of June 30, 2026 and the related amounts are not included above.

The amount due from Otsuka was $4.6 million as of June 30, 2026, for the estimated cost sharing and reimbursement and is presented as collaboration receivable on the Company's condensed balance sheets.