In January 2023, the Board of Directors approved a restructuring plan and the Company announced the consolidation of the ITIL-306 Phase 1 clinical trial, which included contract terminations.

In January 2024, the Board of Directors approved a comprehensive restructuring plan, which included the closure of the Company’s UK manufacturing facility and clinical trial operations. In September 2024, the Board of Directors approved additional UK restructuring actions, which resulted in the elimination of the majority of the remaining UK workforce in the fall of 2024, with the remaining reduction and restructuring activities substantially completed by the end of 2024.

Collectively, the restructuring events from 2023 and 2024 are referred to as the “Plan.” Certain contractual obligations associated with the Plan were settled in 2025, resulting in related cost adjustments.

In March 2025, the Board of Directors approved a plan to sell the Tarzana facility, and the Company listed the Tarzana facility for sale and reclassified it as a long-lived asset held for sale and incurred impairment charges on the facility and as well as charges related to the anticipated cost to sell the facility (collectively, the “2025 Tarzana Charges”).

In January 2026, Axion Bio discontinued development of AXN-2510, and the Company terminated certain employees associated with this program (the “2026 Employee Terminations”).

In May 2026, the Company determined that the Tarzana facility no longer met the criteria for classification as held for sale and reclassified the asset as held and used. In connection with the reclassification, the Company recognized an impairment charge to reduce the carrying value of the Tarzana facility to the lower of its adjusted carrying amount and fair value (the “2026 Tarzana Charges”).

The 2026 Employee Terminations, 2026 Tarzana Charges and 2025 Tarzana Charges are presented within the line item “restructuring and impairment charges, net” in the condensed consolidated statements of operations and comprehensive loss, resulting in a loss of $0.2 million and $1.2 million for the three and six months ended June 30, 2026, respectively, and a loss of $0.5 million and $16.6 million for the three and six months ended June 30, 2025, respectively.

The following table summarizes the restructuring and impairment loss by category (in thousands):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2026		2025		2026		2025
One-time employee termination benefits	$	—	$	—	$	992	$	—
Contract terminations	—		540		—		53
Impairment of long-lived assets held for sale and held and used, net	181		—		181		16,569
Total restructuring and impairment charges, net	$	181	$	540	$	1,173	$	16,622

As a result of the Plan and the 2026 Employee Terminations, a restructuring liability was recorded in the condensed consolidated balance sheets under “Accrued expenses and other current liabilities” and was measured at the amount expected to be paid, or that was paid. During the three and six months ended June 30, 2026, the Company paid nil and $1.0 million of employee benefits, respectively, and expects to pay the remainder of the restructuring costs by the end of 2026.

The following table shows the restructuring liability related to the Plan and the 2026 Employee Terminations (in thousands):


	Employee Benefits		Contract Terminations		Total
Restructuring liability as of December 31, 2025	$	—	$	155	$	155
Additions	992		—		992
Payments	(992)		—		(992)
Restructuring liability as of June 30, 2026	$	—	$	155	$	155