{"url_path":"/sec/cycn/10-q/2026/cover-page","section_key":"cover-page","section_title":"Cover Page","topic":"sec","document":{"doc_type":"10-Q","doc_date":"2026-05-12","source_url":"https://www.sec.gov/Archives/edgar/data/1755237/0001193125-26-219478-index.html","accession_number":"0001193125-26-219478","cik":"0001755237","ticker":"CYCN","issuer_name":"Korsana Biosciences, Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1755237/0001193125-26-219478-index.html","primary_entity_key":"0001755237","primary_entity_name":"Cyclerion Therapeutics, 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STATES\n\nSECURITIES AND EXCHANGE COMMISSION\n\nWashington, D.C. 20549\n\nFORM 10-Q\n\n(Mark One)\n\n \n\n \n\n☒\n\nQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934\n\n \n\nFor the quarterly period ended March 31, 2026\n\nor\n\n \n\n \n\n☐\n\nTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934\n\n \n\nFor the transition period from to\n\nCommission File Number 001-38787\n\nCYCLERION THERAPEUTICS, INC.\n\n(Exact Name of Registrant as Specified in its Charter)\n\n \n\nMassachusetts\n(State or other jurisdiction of\nincorporation or organization)\n\n83-1895370\n(I.R.S. Employer\nIdentification No.)\n\n245 First Street, 18th Floor, Cambridge, Massachusetts\n(Address of principal executive offices)\n\n02142\n(Zip Code)\n\n \n\n(857) 327-8778\n\nRegistrant’s Telephone Number, Including Area Code\n\nSecurities registered pursuant to Section 12(b) of the Act:\n\n \n\nTitle of each class\n\nTrading Symbol(s)\n\nName of each exchange on which registered\n\nCommon Stock, no par value\n\nCYCN\n\nThe Nasdaq Capital Market LLC\n\n \n\nIndicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐\n\nIndicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐\n\nIndicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.\n\n \n\nLarge accelerated filer ☐\n\nAccelerated filer ☐\n\nNon-accelerated filer ☒\n\nSmaller reporting company ☒\n\nEmerging growth company ☐\n\n \n\nIf an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐\n\nIndicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒\n\nAs of May 10, 2026, the registrant had 4,330,314 shares of common stock, no par value, outstanding.\n\n \n\n \n\nCYCLERION PHARMACEUTICALS, INC.\n\nQUARTERLY REPORT ON FORM 10-Q\n\nFOR THE QUARTER ENDED March 31, 2026\n\nTABLE OF CONTENTS\n\n \n\nPage\n\n[PART I — FINANCIAL INFORMATION](#condensed_consolidated_balance_sheets)\n\n[Item 1.](#condensed_consolidated_balance_sheets)\n\n[Financial Statements (unaudited)](#condensed_consolidated_balance_sheets)\n\n6\n\n[Condensed Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025](#condensed_consolidated_balance_sheets)\n\n6\n\n[Condensed Consolidated Statements of Operations and Comprehensive Loss for Three Months Ended March 31, 2026 and 2025](#condensed_consolidated_combined_statemen)\n\n7\n\n[Condensed Consolidated Statements of Stockholders’ Equity for Three Months Ended March 31, 2026 and 2025](#condensed_consolidated_combined)\n\n8\n\n[Condensed Consolidated Statements of Cash Flows for Three Months Ended March 31, 2026 and 2025](#condensed_consolidated)\n\n9\n\n[Notes to the Condensed Consolidated Financial Statements](#notes_to_condensed_consolidated_combined)\n\n10\n\n[Item 2.](#item_2_managements_discussion_analysis_f)\n\n[Management’s Discussion and Analysis of Financial Condition and Results of Operations](#item_2_managements_discussion_analysis_f)\n\n22\n\n[Item 3.](#item_3_quantitative_qualitative_disclosu)\n\n[Quantitative and Qualitative Disclosures About Market Risk](#item_3_quantitative_qualitative_disclosu)\n\n32\n\n[Item 4.](#item_4_controls_procedures)\n\n[Controls and Procedures](#item_4_controls_procedures)\n\n32\n\n \n\n[PART II — OTHER INFORMATION](#part_ii)\n\n \n\n[Item 1.](#item_1_legal_proceedings)\n\n[Legal Proceedings](#item_1_legal_proceedings)\n\n34\n\n[Item 1A.](#item_1a_risk_factors)\n\n[Risk Factors](#item_1a_risk_factors)\n\n34\n\n[Item 5.](#item_5_other_information)\n\n[Other Information](#item_5_other_information)\n\n41\n\n[Item 6.](#item_6_exhibits)\n\n[Exhibits](#item_6_exhibits)\n\n41\n\n[Signatures](#signatures)\n\n43\n\n \n\n \n\n \n\n \n\n \n\nCAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS\n\nThis Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. All statements in this report, other than statements of historical facts, including statements about future events, financing plans, financial position, business strategy, budgets, projected costs, plans and objectives of management for future operations, are forward-looking statements that involve certain risks and uncertainties. Use of the words “may,” “might,” “will,” “would,” “could,” “should,” “believes,” “estimates,” “projects,” “potential,” “expects,” “plans,” “seeks,” “intends,” “aimed,” “evaluates,” “pursues,” “anticipates,” “continues,” “designs,” “impacts,” “affects,” “forecasts,” “target,” “outlook,” “initiative,” “objective,” “designed,” “priorities,” “goal” or the negative of those words or other similar expressions may identify forward-looking statements that represent our current judgment about possible future events, but the absence of these words does not necessarily mean that a statement is not forward-looking.\n\nForward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, our actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include regional, national, or global political, economic, business, competitive, market and regulatory conditions and the following:\n\n•\nthe risk that the conditions to the closing of the Merger (as defined below) with Korsana Biosciences, Inc. (“Korsana”) are not satisfied, including the failure to obtain stockholder approval required to complete the Merger and transactions contemplated thereby;\n\n•\nwe may not be able to meet expectations regarding the timing and completion of the Merger;\n\n•\nit is possible that the Korsana Pre-Closing Financing (as defined below) is not completed;\n\n•\nthere are uncertainties as to the timing and costs of the consummation of the Merger and the ability of each of us and Korsana to consummate the Merger and the transactions contemplated thereby, including the Korsana Pre-Closing Financing;\n\n•\nthere are uncertainties with obtaining the requisite approvals of the stockholders of each of Cyclerion and Korsana and the effectiveness of the registration statement to be filed with the SEC in connection with the Merger and the Pre-Closing Financing;\n\n•\nthe fact that Cyclerion is restrained from soliciting other acquisition proposals during the pendency of the Merger, except in certain circumstances;\n\n•\nthe possibility that the contingent value right (each, a “CVR”) holders may never receive any proceeds pursuant to the CVR Agreement (as defined below);\n\n•\nif we continue to progress the development of our product candidate for potential application in patients suffering from treatment resistant depression, we may not be successful in acquiring all license and other rights necessary to develop this technology, establish and successfully complete clinical studies, obtain necessary regulatory governmental approvals and successfully commercialize this product candidate;\n\n•\nthere is substantial doubt regarding our ability to continue as a going concern and we will need to raise capital in the near term in order to maintain our operations;\n\n•\nif we continue to progress the development of our product candidates, we may be unable to access capital, capabilities, and transactions necessary to advance the development of the product candidate under evaluation and any future product candidates;\n\n•\nthere is substantial uncertainty regarding our future financial performance, potential revenues, expense levels, payments, cash flows, profitability, tax obligations, concentration of voting control, as well as the timing and drivers thereof;\n\n \n\n3\n\n \n\n•\nthere is uncertainty regarding the impact of government funding and regulation in the life sciences industry, particularly with regard to funding for new drug development, staffing levels at government agencies and healthcare reform generally;\n\n•\nif we continue to progress the development of our product candidates, there may be substantial delays to timing, investment and associated activities involved in developing, obtaining regulatory approval for, launching and commercializing the product candidate under evaluation and potential future product candidates;\n\n•\nwe may be unable to maintain our relationships with third parties, collaborators and our employees or execute our strategic priorities;\n\n•\nwe may fail to maintain our Nasdaq listing;\n\n•\nthere are significant risks in our investment in Tisento Therapeutics Inc. (“Tisento”) tied to Tisento developing, obtaining regulatory approval for, launching and commercializing its product candidates and such risks may negatively impact our investment in Tisento;\n\n•\nthere is uncertainty regarding any liquidity or monetizable value of our equity interest in Tisento, which faces all the risks of an early-stage pharmaceutical development company;\n\n•\nthere is uncertainty as to whether any future development, regulatory, and commercialization milestones or royalty payments provided for in the license agreement with Akebia Therapeutics, Inc. will be achieved;\n\n•\nwe are seeking to out-license our olinciguat technology and we may be unsuccessful in identifying and entering into a licensing agreement in which event we would not be able to receive future royalty and milestone payments for olinciguat;\n\n•\nin connection with our recent license agreement with the Massachusetts Institute of Technology (the “MIT License Agreement”), we must maintain minimum royalty payments and meet certain milestones and fulfill other obligations in order to retain rights under the license rights granted under the MIT License Agreement (the “MIT License”);\n\n•\nin connection with our recent Collaboration and Option to License Agreement with Medsteer SAS (the “Collaboration Agreement”), if we elect to exercise the right to license certain rights held by Medsteer, we must maintain minimum royalty payments and meet certain milestones and fulfill other obligations in order to retain rights under the license rights if exercised under the Collaboration Agreement;\n\n•\nour product candidates and those we have sold to Tisento or out-licensed to Akebia have not been approved for sale by regulatory agencies and may not prove to meet safety and efficacy requirements and if Tisento, Akebia or any potential future licensees are unable to comply with U.S. and non-U.S. regulatory requirements, including any post-approval development and regulatory requirements, or our potential future product candidates are unable to comply with such requirements, our operating results may suffer;\n\n•\nwe, Tisento and our current licensee and potentially any future licensees may be unable to obtain reimbursement from the U.S. government and third-party payors for potential future product candidates if and when commercialized;\n\n•\nif we are unable to attract and retain employees needed to execute our business plans and strategies and or manage the impact of any loss of key employees our financial condition and results of operations may suffer;\n\n•\nour business may be negatively impacted if we are unable to obtain and maintain intellectual property protection for our own technology and licensed technology necessary for current and potential future product candidates;\n\n•\nthird parties may allege we infringe their intellectual property rights, or could seek to invalidate any intellectual property rights we own or have licensed to third parties, which could result in adverse outcomes;\n\n \n\n4\n\n \n\n•\nwe may be impacted by trends and challenges in the markets affecting our potential future product candidates;\n\n•\nwe may be unable to compete with other companies that are or may be developing or selling products that are competitive with any potential future product candidates;\n\n•\na determination that we constitute an investment company under the Investment Company Act of 1940, as amended, and if we are required to register thereunder, could have a material adverse effect on us;\n\n•\na pandemic or natural disaster may disrupt our business, including our development activities, resulting in a material adverse effect on our financial condition and results of operations; and\n\n•\nwe may fail to maintain effective internal controls over financial reporting.\n\nSee the “Risk Factors” section in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, as filed with the Securities and Exchange Commission on March 30, 2026 for a further description of these and other factors. We caution you that the risks, uncertainties, and other factors referenced above may not contain all of the risks, uncertainties and other factors that are important to you. In addition, we cannot assure you that we will realize the results, benefits, or developments that we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our business in the way expected. There can be no assurance that (i) we have correctly measured or identified all of the factors affecting our business or the extent of these factors’ likely impact, (ii) the available information with respect to these factors on which such analysis is based is complete or accurate, (iii) such analysis is correct or (iv) our strategy, which is based in part on this analysis, will be successful. All forward-looking statements in this report apply only as of the date of this report or as of the date they were made and, except as required by applicable law, we undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise.\n\n \n\n5\n\n \n\nCyclerion Therapeutics, Inc.\n\nCondensed Consolidated Balance Sheets\n\n(In thousands except share and per share data)\n\n(Unaudited)\n\n \n\n \n\n \n\nMarch 31,\n2026\n\n \n\n \n\nDecember 31,\n2025\n\n \n\nASSETS\n\n \n\n \n\n \n\n \n\n \n\n \n\nCurrent assets:\n\n \n\n \n\n \n\n \n\n \n\n \n\nCash and cash equivalents\n\n \n\n$\n\n2,823\n\n \n\n \n\n$\n\n3,240\n\n \n\nAccounts receivable\n\n \n\n \n\n—\n\n \n\n \n\n \n\n1,000\n\n \n\nPrepaid expenses\n\n \n\n \n\n255\n\n \n\n \n\n \n\n384\n\n \n\nOther current assets\n\n \n\n \n\n11\n\n \n\n \n\n \n\n11\n\n \n\nTotal current assets\n\n \n\n \n\n3,089\n\n \n\n \n\n \n\n4,635\n\n \n\nProperty and equipment, net\n\n \n\n \n\n66\n\n \n\n \n\n \n\n—\n\n \n\nOther investment\n\n \n\n \n\n5,350\n\n \n\n \n\n \n\n5,350\n\n \n\nTotal assets\n\n \n\n$\n\n8,505\n\n \n\n \n\n$\n\n9,985\n\n \n\nLIABILITIES AND STOCKHOLDERS’ EQUITY\n\n \n\n \n\n \n\n \n\n \n\n \n\nCurrent liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nAccounts payable\n\n \n\n$\n\n457\n\n \n\n \n\n$\n\n508\n\n \n\nAccrued research and development costs\n\n \n\n \n\n148\n\n \n\n \n\n \n\n198\n\n \n\nAccrued expenses and other current liabilities\n\n \n\n \n\n1,109\n\n \n\n \n\n \n\n194\n\n \n\nTotal current liabilities\n\n \n\n \n\n1,714\n\n \n\n \n\n \n\n900\n\n \n\nCommitments and contingencies (Note 6)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nStockholders' equity\n\n \n\n \n\n \n\n \n\n \n\n \n\nPreferred stock, no par value, 100,000,000 shares authorized and 351,037 shares of Series A convertible preferred stock issued and outstanding at March 31, 2026 and December 31, 2025\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nCommon stock, no par value, 400,000,000 shares authorized at March 31, 2026 and December 31, 2025; 4,330,314 and 3,925,314 shares issued at March 31, 2026 and December 31, 2025, respectively; 4,241,260 and 3,821,236 shares outstanding at March 31, 2026 and December 31, 2025, respectively\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nPaid-in capital\n\n \n\n \n\n280,988\n\n \n\n \n\n \n\n280,105\n\n \n\nAccumulated deficit\n\n \n\n \n\n(274,197\n\n)\n\n \n\n \n\n(271,020\n\n)\n\nTotal stockholders' equity\n\n \n\n \n\n6,791\n\n \n\n \n\n \n\n9,085\n\n \n\nTotal liabilities and stockholders' equity\n\n \n\n$\n\n8,505\n\n \n\n \n\n$\n\n9,985\n\n \n\n \n\nThe accompanying notes are an integral part of these condensed consolidated financial statements.\n\n \n\n6\n\n \n\nCyclerion Therapeutics, Inc.\n\nCondensed Consolidated Statements of Operations and Comprehensive Loss\n\n(In thousands except per share data)\n\n(Unaudited)\n\n \n\n \n\n \n\nThree Months Ended\nMarch 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\nRevenues:\n\n \n\n \n\n \n\n \n\n \n\n \n\nRevenue from option agreement\n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n81\n\n \n\nTotal revenues\n\n \n\n \n\n—\n\n \n\n \n\n \n\n81\n\n \n\nCost and expenses:\n\n \n\n \n\n \n\n \n\n \n\n \n\nResearch and development\n\n \n\n \n\n730\n\n \n\n \n\n \n\n36\n\n \n\nGeneral and administrative\n\n \n\n \n\n2,479\n\n \n\n \n\n \n\n1,502\n\n \n\nTotal cost and expenses\n\n \n\n \n\n3,209\n\n \n\n \n\n \n\n1,538\n\n \n\nLoss from operations\n\n \n\n \n\n(3,209\n\n)\n\n \n\n \n\n(1,457\n\n)\n\nOther income, net\n\n \n\n \n\n \n\n \n\n \n\n \n\nInterest income\n\n \n\n \n\n32\n\n \n\n \n\n \n\n28\n\n \n\nTotal other income, net\n\n \n\n \n\n32\n\n \n\n \n\n \n\n28\n\n \n\nNet loss and other comprehensive loss\n\n \n\n$\n\n(3,177\n\n)\n\n \n\n$\n\n(1,429\n\n)\n\nNet loss per share:\n\n \n\n \n\n \n\n \n\n \n\n \n\nBasic and diluted net loss per share\n\n \n\n$\n\n(0.76\n\n)\n\n \n\n$\n\n(0.56\n\n)\n\nWeighted average shares used in calculating:\n\n \n\n \n\n \n\n \n\n \n\n \n\nBasic and diluted shares\n\n \n\n \n\n4,205\n\n \n\n \n\n \n\n2,556\n\n \n\n \n\nThe accompanying notes are an integral part of these condensed consolidated financial statements.\n\n \n\n \n\n \n\n7\n\n \n\nCyclerion Therapeutics, Inc.\n\nCondensed Consolidated Statements of Stockholders’ Equity\n\n(In thousands except share data)\n\n(Unaudited)\n\n \n\n \n\n \n\nCommon Stock\n\n \n\n \n\nPreferred Stock\n\n \n\n \n\nPaid-in\n\n \n\n \n\nAccumulated\n\n \n\n \n\nTotal\nStockholders’\n\n \n\n \n\n \n\nShares\n\n \n\n \n\nAmount\n\n \n\n \n\nShares\n\n \n\n \n\nAmount\n\n \n\n \n\ncapital\n\n \n\n \n\ndeficit\n\n \n\n \n\nequity\n\n \n\nBalance at December 31, 2024\n\n \n\n \n\n2,545,922\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n \n\n351,037\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n276,342\n\n \n\n \n\n$\n\n(267,492\n\n)\n\n \n\n$\n\n8,850\n\n \n\nNet loss\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n(1,429\n\n)\n\n \n\n \n\n(1,429\n\n)\n\nIssuance of common stock - private placement, net of issuance cost\n\n \n\n \n\n499,998\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n1,245\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n1,245\n\n \n\nVesting of restricted stock awards\n\n \n\n \n\n15,024\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nShare-based compensation expense related to issuance of stock options and restricted stock awards\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n114\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n114\n\n \n\nBalance at March 31, 2025\n\n \n\n \n\n3,060,944\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n \n\n351,037\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n277,701\n\n \n\n \n\n$\n\n(268,921\n\n)\n\n \n\n$\n\n8,780\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommon Stock\n\n \n\n \n\nPreferred Stock\n\n \n\n \n\nPaid-in\n\n \n\n \n\nAccumulated\n\n \n\n \n\nTotal\nStockholders’\n\n \n\n \n\n \n\nShares\n\n \n\n \n\nAmount\n\n \n\n \n\nShares\n\n \n\n \n\nAmount\n\n \n\n \n\ncapital\n\n \n\n \n\ndeficit\n\n \n\n \n\nequity\n\n \n\nBalance at December 31, 2025\n\n \n\n \n\n3,821,236\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n \n\n351,037\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n280,105\n\n \n\n \n\n$\n\n(271,020\n\n)\n\n \n\n$\n\n9,085\n\n \n\nIssuance of common stock - ATM\n\n \n\n \n\n405,000\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n825\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n825\n\n \n\nNet loss\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n(3,177\n\n)\n\n \n\n \n\n(3,177\n\n)\n\nVesting of restricted stock awards\n\n \n\n \n\n15,024\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nShare-based compensation expense related to issuance of stock options and restricted stock awards\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n58\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n58\n\n \n\nBalance at March 31, 2026\n\n \n\n \n\n4,241,260\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n \n\n351,037\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n280,988\n\n \n\n \n\n$\n\n(274,197\n\n)\n\n \n\n$\n\n6,791\n\n \n\n \n\n \n\nThe accompanying notes are an integral part of these condensed consolidated financial statements.\n\n \n\n8\n\n \n\nCyclerion Therapeutics, Inc.\n\nCondensed Consolidated Statements of Cash Flows\n\n(In thousands)\n\n(Unaudited)\n\n \n\n \n\nThree Months Ended March 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\nCASH FLOWS FROM OPERATING ACTIVITIES:\n\n \n\n \n\n \n\n \n\n \n\n \n\nNet loss\n\n \n\n$\n\n(3,177\n\n)\n\n \n\n$\n\n(1,429\n\n)\n\nAdjustments to reconcile net loss to net cash used in operating activities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nShare-based compensation expense\n\n \n\n \n\n58\n\n \n\n \n\n \n\n114\n\n \n\nChanges in operating assets and liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nAccounts receivable\n\n \n\n \n\n1,000\n\n \n\n \n\n \n\n(25\n\n)\n\nPrepaid expenses\n\n \n\n \n\n129\n\n \n\n \n\n \n\n165\n\n \n\nOther current assets\n\n \n\n \n\n—\n\n \n\n \n\n \n\n(5\n\n)\n\nAccounts payable\n\n \n\n \n\n(51\n\n)\n\n \n\n \n\n93\n\n \n\nAccrued research and development costs\n\n \n\n \n\n(50\n\n)\n\n \n\n \n\n(2\n\n)\n\nAccrued expenses and other current liabilities\n\n \n\n \n\n915\n\n \n\n \n\n \n\n121\n\n \n\nNet cash used in operating activities\n\n \n\n \n\n(1,176\n\n)\n\n \n\n \n\n(968\n\n)\n\nCASH FLOWS FROM INVESTING ACTIVITIES:\n\n \n\n \n\n \n\n \n\n \n\n \n\nPurchases of property and equipment\n\n \n\n \n\n(66\n\n)\n\n \n\n \n\n—\n\n \n\nNet cash used in investing activities\n\n \n\n \n\n(66\n\n)\n\n \n\n \n\n—\n\n \n\nCASH FLOWS FROM FINANCING ACTIVITIES:\n\n \n\n \n\n \n\n \n\n \n\n \n\nProceeds from ATM\n\n \n\n \n\n825\n\n \n\n \n\n \n\n—\n\n \n\nProceeds from private placement\n\n \n\n \n\n—\n\n \n\n \n\n \n\n1,375\n\n \n\nNet cash provided by financing activities\n\n \n\n \n\n825\n\n \n\n \n\n \n\n1,375\n\n \n\nNet (decrease) increase in cash and cash equivalents\n\n \n\n \n\n(417\n\n)\n\n \n\n \n\n407\n\n \n\nCash and cash equivalents, beginning of period\n\n \n\n \n\n3,240\n\n \n\n \n\n \n\n3,232\n\n \n\nCash and cash equivalents, end of period\n\n \n\n$\n\n2,823\n\n \n\n \n\n$\n\n3,639\n\n \n\n \n\nThe accompanying notes are an integral part of these condensed consolidated financial statements.\n\n \n\n9\n\n \n\nCyclerion Therapeutics, Inc.\n\nNotes to the Condensed Consolidated Financial Statements\n\n(Unaudited)\n\n1. Nature of Business\n\nNature of Operations\n\nCyclerion Therapeutics, Inc. (“Cyclerion”, the “Company” or “we”) became an independent public company on April 1, 2019 after Ironwood Pharmaceuticals, Inc. completed a tax-free spin-off of their sGC business. Cyclerion has one employee as of March 31, 2026 and also relies on a team of specialist consultants for its operations.\n\nCyclerion has historically focused on building a pipeline of innovative therapeutics to address serious neuropsychiatric disorders with significant unmet medical need. Prior to the proposed Merger, its strategic focus was centered on the development of a novel therapeutic approach for neuropsychiatric conditions, with the lead indication being treatment-resistant depression (“TRD”), which it believes represents a substantial clinical and commercial opportunity. Over the past year, the Company has refined our strategic direction toward programs that combine established pharmacologic agents with enabling technologies designed to improve precision, reproducibility, and patient outcomes. As part of this strategy, The Company has evaluated multiple opportunities and prioritized CYC-126, an individualized therapy for TRD as its foundational development program.\n\nIn September 2025, the Company entered into a license agreement with the Massachusetts Institute of Technology (“MIT”) for intellectual property supporting this TRD program. In January 2026, the Company also entered into a collaboration and option-to-license agreement with Medsteer SAS (“Medsteer”), a developer of anesthesia delivery and monitoring technologies. This agreement provides the Company with access to Medsteer’s technical expertise, data assets, and intellectual property relating to technology-enabled drug delivery and physiological monitoring, and grants the Company the right, but not the obligation, to obtain additional rights under specified conditions. The Company intends to evaluate these capabilities as part of our broader development strategy for our TRD program. Given the substantial unmet medical need in TRD, the stage of clinical development, and the potential commercial opportunity, the Company believe this program is well positioned to serve as the foundation of our future development efforts. The program team is currently advancing an integrated clinical, regulatory, and commercial strategy for this TRD program.\n\nIn parallel with the advancement of our neuropsychiatric strategy, the Company continues to evaluate opportunities related to potentially monetizing its legacy soluble guanylate cyclase (“sGC”) stimulator assets, including potential collaborations, monetization opportunities, or other strategic transactions intended to maximize shareholder value.\n\nPraliciguat is an orally administered, once-daily systemic sGC stimulator. On June 3, 2021, Cyclerion entered into a license agreement with Akebia Therapeutics Inc. (“Akebia”) relating to the exclusive worldwide license to Akebia of our rights to the development, manufacture, medical affairs and commercialization of pharmaceutical products containing praliciguat and other related products and forms thereof enumerated in such agreement. In 2021, Akebia paid a $3.0 million upfront payment to the Company upon signing of the license agreement.\n\nOn December 13, 2024, Cyclerion announced that Cyclerion and Akebia had re-negotiated a mutually beneficial amendment to their exclusive license agreement for praliciguat, a systemic sGC stimulator. Under this new license amendment, Cyclerion received $1.75 million in amendment payments, of which $1.25 million was paid in December 2024 and the remaining additional payment of $0.5 million was received in September 2025. In addition, Akebia is responsible for all intellectual property expenses associated with praliciguat. On December 1, 2025, Akebia publicly announced that it has recently initiated (defined as first patient dosed) Phase 2 clinical trials for the treatment of focal segmental glomerulosclerosis (“FSGS”) using praliciguat. Pursuant to the terms of amendment, upon initiation of a Phase 2 clinical trial in the U.S. for a product, a $1.0 million development milestone payment was received in February 2026. The Company is eligible to receive additional milestone cash payments of up to approximately $557.5 million in total potential future development, regulatory, and commercialization milestone payments for praliciguat. In exchange for a reduction in certain development milestone payments,\n\n \n\n10\n\n \n\nCyclerion is eligible to receive certain higher-tiered sales-based royalties ranging from mid-single-digits to twenty percent. Payment of these sums are reserved for Cyclerion stockholders under the “Cyclerion CVR Agreement” described below.\n\nOlinciguat is a Phase 2, orally administered, once-daily, vascular sGC stimulator. On July 22, 2024, the Company entered into an Option to License Agreement (the “Option Agreement”) with a third party (the “Optionee”), pursuant to which the Optionee had an option (the “Option”) to enter into an exclusive license to olinciguat for human therapeutics, subject to certain carveouts. Under the terms of the Option Agreement, the Optionee paid the Company an Option fee of $150,000 in August 2024 and subsequent fees totaling $80,000 to extend the term of the Option Agreement. The Optionee originally could exercise the Option on or before March 20, 2025, which was ultimately extended through August 22, 2025. Thereafter, the parties had an additional 60 days to negotiate the terms of a definitive license agreement. The parties were unable to agree upon the terms of a license agreement and the Company provided notice on October 23, 2025 that it was terminating the Option Agreement. The Company is currently exploring potential license opportunities for olinciguat.\n\nZagociguat is a clinical-stage CNS-penetrant sGC stimulator that has shown rapid improvement in cerebral blood flow, functional brain connectivity, brain response to visual stimulus, cognitive performance, and biomarkers associated mitochondrial function and inflammation in clinical studies. CY3018 is a CNS-targeted sGC stimulator that preferentially localizes to the brain and has a pharmacology profile that suggests its potential for the treatment of neuropsychiatric diseases and disorders. On July 28, 2023, the Company sold Zagociguat and CY3018 to Tisento Therapeutics, Inc. (“Tisento”), a newly formed private company focused on their development, in exchange for $8.0 million in cash consideration, $2.4 million as reimbursement for certain operating expenses related to zagociguat and CY3018 for the period between signing and closing of the transaction, and 10% of all of Tisento’s parent’s outstanding equity securities (“Tisento Parent”).\n\n2025 Equity Private Placement\n\nOn March 21, 2025, the Company entered into a Stock Purchase Agreement (the “2025 Equity Private Placement”) for a private placement of 499,998 shares of the Company’s common stock, at a purchase price of $2.75 per share for total gross proceeds of approximately $1.375 million. The closing of the 2025 Equity Private Placement occurred on March 25, 2025. The Company incurred transaction costs of $0.1 million for the 2025 Equity Private Placement. The Shares issued were not registered under the Securities Act of 1933, as amended, or any state securities laws and will be issued pursuant to the exemption from registration provided for under Section 4(a)(2) of the Securities Act as a transaction not involving a public offering.\n\nIn connection with the 2025 Equity Private Placement, the Company entered into a Registration Rights Agreement with the investors, dated March 21, 2025, pursuant to which the Company agreed to register the resale of the Shares pursuant to a registration statement which was filed with the SEC and declared effective by the SEC on May 15, 2025.\n\nAt-the-Market Offering\n\nOn February 4, 2025, the Company filed a Registration Statement on Form S-3 (the “Shelf”) with the Securities and Exchange Commission (the “SEC”) in relation to the registration of common stock, preferred stock, warrants and units of any combination thereof for an aggregate initial offering price not to exceed $25.0 million. The Registration Statement was declared effective by the SEC in February 2025.\n\nOn May 7, 2025, the Company and Guggenheim Securities, LLC (“Guggenheim Securities”) entered into a Sales Agreement (the “Sales Agreement”), pursuant to which the Company may offer and sell shares of common stock, no par value per share (the “Shares”), having an aggregate offering price of up to $20,000,000 from time to time through or to Guggenheim Securities, acting as the Company’s agent, subject to the application of General Instruction I.B.6 of Form S-3 (“Instruction I.B.6”) pertaining to primary offerings by certain registrants, including the Company. The Company has provided Guggenheim Securities with customary indemnification rights, and the Company will pay Guggenheim Securities cash commission of 3.0% of the gross proceeds of the Shares sold under the Sales Agreement.\n\nDuring the year ended December 31, 2025, the Company sold 715,220 shares of its common stock for net\n\n \n\n11\n\n \n\nproceeds of $2.1 million under the Sales Agreement, after deducting commissions paid to Guggenheim Securities of $0.1 million. During the three months ended March 31, 2026, the Company sold 405,000 shares of common stock under the Sales Agreement for net proceeds of approximately $0.8 million. The Company exhausted all sales under the 2025 Shelf.\n\nThe Merger Agreement\n\nOn April 1, 2026, Cyclerion entered into a Plan of Merger and Reorganization (as amended, the “Merger Agreement”) with Korsana, a privately held biotechnology company discovering and developing novel therapies to reduce the burden of neurodegenerative diseases, pursuant to which among other matters, and subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, Cariboos Merger Sub Corp., a Delaware corporation (“First Merger Sub”), will merge with and into Korsana, with Korsana continuing as a wholly owned subsidiary of Cyclerion and the surviving corporation of the merger (the “First Merger”), and Korsana will merge with and into Cariboos Merger Sub II, LLC, a Delaware limited liability company (“Second Merger Sub” and together with First Merger Sub, “Merger Subs”), with Second Merger Sub being the surviving entity of the merger (the “Second Merger” and, together with the First Merger, the “Merger”). After the completion of the Merger, Second Merger Sub will change its corporate name to “Korsana Biosciences Operating Company, LLC” and Cyclerion will change its name to “Korsana Biosciences, Inc.”. Cyclerion anticipates that the Merger will close in the third quarter of 2026, subject to certain closing conditions, along with the concurrent Korsana Pre-Closing Financing described below. Following the Merger, the current business of Korsana will become the primary business of Cyclerion.\n\nAt the closing of the First Merger (the “First Effective Time”, and the date on which the closing of the Merger occurs, the “Closing Date”), upon the terms and subject to the conditions set forth in the Merger Agreement: (i) each then-outstanding share of common stock, $0.0001 par value per share, of Korsana (the “Korsana Common Stock”) and Series A Preferred Stock, $0.0001 par value per share of Korsana (“Korsana Series A Preferred Stock”) (including shares of Korsana Common Stock issued in the Korsana Pre-Closing Financing described below), excluding any shares to be cancelled pursuant to the Merger Agreement and excluding dissenting shares, will be automatically converted solely into the right to receive a number of shares of Cyclerion common stock, no par value per share (the “Cyclerion Common Stock”), equal to the exchange ratio as described in the Merger Agreement (the “Exchange Ratio”); provided, that in the event the aggregate number of shares of Cyclerion Common Stock issuable to a holder of Korsana capital stock (when aggregated with all of the shares of the Cyclerion Common Stock outstanding then beneficially owned by such person and its affiliates (as calculated pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3 promulgated thereunder) immediately after giving effect to the issuance of the merger consideration) would result in the issuance of shares of Cyclerion Common Stock to a holder in excess of a specified percentage (initially set at a percentage up to 9.99%) of the total outstanding shares of Cyclerion Common Stock (such specified percentage, a “Beneficial Ownership Limitation”), then Cyclerion will issue to any such holder (x) shares of Cyclerion Common Stock up to such holder’s Beneficial Ownership Limitation and (y) in lieu of any shares in excess of such holder’s Beneficial Ownership Limitation, pre-funded warrants (“Cyclerion Pre-Funded Warrants”) to purchase a number of shares of Cyclerion Common Stock upon exercise of such Cyclerion Pre-Funded Warrants equal to such excess shares; (ii) each then-outstanding share of Korsana Series Seed Preferred Stock, $0.0001 par value per share (“Korsana Series Seed Preferred Stock” and, together with the Korsana Series A Preferred Stock, the “Korsana Preferred Stock”), excluding any shares of Korsana Series Seed Preferred Stock to be cancelled pursuant to the Merger Agreement and any dissenting shares, will be converted into the right to receive a number of shares of Cyclerion Series B non-voting convertible preferred stock, no par value per share (“Cyclerion Series B Preferred Stock”), equal to the Exchange Ratio divided by 1,000; (iii) each then-outstanding option (a “Korsana Option”) to purchase shares of Korsana Common Stock will be converted into and become an option to purchase shares of Cyclerion Common Stock on the existing terms and conditions (including with respect to vesting and accelerated vesting), subject to adjustment as set forth in the Merger Agreement; (iv) each then-outstanding restricted stock unit for shares of Korsana Common Stock will be converted into and become a restricted stock unit for shares of Cyclerion Common Stock on the existing terms and conditions (including with respect to vesting and accelerated vesting), subject to adjustment as set forth in the Merger Agreement; and (v) each then-outstanding warrant to purchase shares of Korsana Common Stock will be converted into a warrant to purchase shares of Cyclerion Common Stock on the existing terms and conditions, subject to adjustment as set forth in the Merger Agreement.\n\nEach share of Cyclerion Common Stock and Cyclerion Series A Preferred Stock that is issued and outstanding at the First Effective Time will remain issued and outstanding and such shares, subject to the proposed reverse stock split, will be unaffected by the Merger. Prior to the First Effective Time, the Cyclerion board of\n\n \n\n12\n\n \n\ndirectors will accelerate the vesting of all options to purchase shares of Cyclerion Common Stock (“Cyclerion Options”) and all restricted stock awards (“Cyclerion RSAs”). Each outstanding Cyclerion Option with an exercise price per share equal to or less than the volume weighted average closing trading price of a share of Cyclerion Common Stock on The Nasdaq Stock Market LLC (“Nasdaq”) for the five consecutive trading days ending three trading days prior to the Calculation Date (as defined in the Merger Agreement), as reported by Bloomberg L.P. (the “Cyclerion Closing Price”), will be cancelled at the First Effective Time and such holder thereof will receive an amount in cash, without interest, less any applicable tax withholding, equal to the product obtained by multiplying the excess of the Cyclerion Closing Price over the exercise price per share of the Cyclerion Common Stock underlying such Cyclerion Option by the number of shares of the Cyclerion Common Stock underlying such Cyclerion Option. Each Cyclerion Option with an exercise price greater than the Cyclerion Closing Price will be cancelled for no consideration. The vesting of each Cyclerion RSA will be accelerated in full.\n\nBased on Cyclerion’s capitalization as of December 31, 2025 and Korsana’s capitalization as of March 31, 2026 and assuming Cyclerion’s net cash as of closing being equal to $0, each share of Korsana Common Stock and Korsana Series A Preferred Stock is currently estimated to be entitled to receive approximately 1.1009 shares of Cyclerion Common Stock. Each share of Korsana Series Seed Preferred Stock will be converted into the right to receive a number of shares of Cyclerion Series B Preferred Stock, equal to the Exchange Ratio divided by 1,000. The estimated Exchange Ratio does not give effect to the proposed Cyclerion reverse stock split and is subject to adjustment based on Cyclerion’s estimated net cash at the closing of the First Merger.\n\nIn connection with the Merger, on April 1, 2026, Korsana entered into a securities purchase agreement (the “Securities Purchase Agreement”) with certain institutional and accredited investors for the purchase of shares of Korsana Common Stock and Pre-Funded Warrants to purchase shares of Korsana Common Stock (the “Korsana Pre-Funded Warrants”) for an aggregate purchase price of approximately $380.0 million, immediately prior to the closing of the Merger (referred to herein as the “Korsana Pre-Closing Financing”). The shares of Korsana Common Stock and Korsana Pre-Funded Warrants that are issued in the Korsana Pre-Closing Financing will be converted into the right to receive a number of shares of Cyclerion Common Stock and Cyclerion Pre-Funded Warrants, respectively, equal to the Exchange Ratio. Korsana and the investors participating in the Korsana Pre-Closing Financing have also agreed to enter into a registration rights agreement at the closing of the Korsana Pre-Closing Financing, pursuant to which, among other things, the Combined Company will agree to provide for the registration and resale of certain shares of Korsana Common Stock that are held by the investors participating in the Korsana Pre-Closing Financing from time to time pursuant to Rule 415 under the Securities Act.\n\nBased on its current operating plan, Cyclerion expects that its current cash and cash equivalents will fund its operations until the closing of the contemplated Merger, which is subject to approval by its shareholders and the shareholders of Korsana and other customary closing conditions; however, Cyclerion has based this estimate on assumptions that may prove to be wrong, and Cyclerion could use its capital resources sooner than Cyclerion expects.\n\nCyclerion CVR Agreement\n\nAt or prior to the first merger, Cyclerion will enter into a Contingent Value Rights Agreement (the “CVR Agreement”) with a designated rights agent (the “Rights Agent”), pursuant to which Cyclerion’s pre-merger shareholders will receive one CVR for each outstanding share of Cyclerion Common Stock and Cyclerion Series A Preferred Stock held by such shareholder on such date. Each CVR will represent the contractual right to receive certain net proceeds, if any, derived from any consideration that is paid to Cyclerion as a result of the disposition of Cyclerion’s pre-Merger legacy assets, net of any indemnity obligations, transaction costs and certain other expenses, during the period beginning on the date of the closing of the merger and ending (i) with respect to the sale, transfer, license or other disposition of all pre-merger legacy assets other than those pre-merger legacy assets described in the following clauses (ii) and (iii), upon the second (2nd) anniversary of the Closing Date, (ii) with respect to Cyclerion’s right to receive payments under the Akebia License Agreement, the earlier of (A) the fifteenth (15th) anniversary of the date of entry into the CVR Agreement and (B) the expiration or earlier termination by Akebia Therapeutics, Inc. of the Akebia License Agreement pursuant to its terms, and (iii) with respect to the sale, transfer or other disposition of the equity interests of Tisento that were acquired by Cyclerion pursuant to that certain Asset Purchase Agreement, dated May 13, 2023, by and among Cyclerion, Tisento and JW Cycle, Inc., the earliest of (A) nine (9) months following the date of the consummation of Tisento’s initial public offering pursuant to a registration statement filed with, and declared effective by, the Securities and Exchange Commission pursuant to the Securities Act, (B) the sale of Tisento, and (C) the seventh (7th) anniversary of the Closing Date.\n\n \n\n13\n\n \n\nThe contingent payments under the CVR Agreement, if they become payable, will become payable to the Rights Agent for subsequent distribution to the holders of the CVRs. In the event that no such proceeds are received, holders of the CVRs will not receive any payment pursuant to the CVR Agreement. There can be no assurance that any holders of CVRs will receive any payments with respect thereto.\n\nBasis of Presentation\n\nThe condensed consolidated financial statements and the related disclosures are unaudited and have been prepared in accordance with accounting principles generally accepted in the U.S. Additionally, certain information and footnote disclosures normally included in the Company’s annual financial statements have been condensed or omitted. Accordingly, these interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, which was filed with the SEC on March 30, 2026.\n\nIn the opinion of management, the unaudited interim condensed consolidated financial statements reflect all normal recurring adjustments considered necessary for a fair presentation of the Company’s financial position and the results of its operations for the interim periods presented. The results of operations for the three months ended March 31, 2026 and 2025 are not necessarily indicative of the results that may be expected for the full year or any other subsequent interim period.\n\nThe condensed consolidated financial statements include the financial statements of the Company and its wholly owned subsidiaries, Cyclerion Securities Corporation, Cyclerion Australia Pty Ltd., Cariboos Merger Sub Corp. and Cariboos Merger Sub II, LLC. All significant intercompany accounts and transactions have been eliminated in the preparation of the accompanying condensed consolidated financial statements.\n\nGoing Concern\n\nAt each reporting period, in accordance with Accounting Standards Codification (\"ASC\") 205-40, Going Concern, the Company evaluates whether there are conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The Company’s evaluation entails analyzing prospective operating budgets and forecasts for expectations of the Company’s cash needs and comparing those needs to the current cash and cash equivalent balances. The Company is required to make certain additional disclosures if it concludes substantial doubt exists and it is not alleviated by the Company’s plans or when its plans alleviate substantial doubt about the Company’s ability to continue as a going concern.\n\nThis evaluation initially does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented as of the date the financial statements are issued. When substantial doubt exists under this methodology, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that these condensed consolidated financial statements are issued. In performing its analysis, management excluded certain elements of its operating plan that cannot be considered probable. Under ASC 205-40, the future receipt of potential funding from future partnerships, license payments, equity or debt issuances, certain cost reduction measures and the achievement of potential milestone payments from Akebia cannot be considered probable at this time because these plans are not entirely within the Company’s control and/or have not been approved by the Board of Directors as of the date of these condensed consolidated financial statements.\n\nThe Company expects that its cash and cash equivalents as of March 31, 2026, will be sufficient to fund operations into the third quarter of 2026, however the Company will need to obtain additional funding to sustain operations as it expects to continue to generate operating losses for the foreseeable future. The Company's expectation to generate negative operating cash flows in the future and the need for additional funding to support its planned operations, raise substantial doubt regarding the Company’s ability to continue as a going concern. Management's plans to alleviate the conditions that raise substantial doubt include reduced spending, and the pursuit\n\n \n\n14\n\n \n\nof additional capital. Management has concluded the likelihood that its plan to successfully obtain sufficient funding, or adequately reduce expenditures, while reasonably possible, is less than probable. Accordingly, the Company has concluded that substantial doubt exists about the Company’s ability to continue as a going concern. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above.\n\nThe Company’s future operations are highly dependent on the success of the Merger and there can be no assurances that the Merger will be successfully consummated. If the Merger is not consummated, the Company believes that its cash and cash equivalents as of March 31, 2026 would be adequate to fund its operating expenses into the third quarter of 2026. However, in order to continue development of its programs, the Company would need to secure substantial additional funding in the future, from one or more equity or debt financings, collaborations, or other sources. Additional funding may not be available to the Company on acceptable terms, or at all. The Company’s Board of Directors may also decide to pursue a dissolution and liquidation in lieu of continuing program development in the event the Merger is not consummated.\n\n \n\n2. Summary of Significant Accounting Policies\n\nThe accounting policies of the Company are set forth in Note 2. Summary of Significant Accounting Policies to the consolidated financial statements contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025.\n\nNew Accounting Pronouncements\n\nFrom time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date. Except as discussed elsewhere in the notes to the interim condensed consolidated financial statements, the Company did not adopt any new accounting pronouncements during the three months ended March 31, 2026 that had a material effect on its condensed consolidated financial statements.\n\nNo other accounting standards known by the Company to be applicable to it that have been issued by the FASB or other standard-setting bodies and that do not require adoption until a future date are expected to have a material impact on the Company’s condensed consolidated financial statements upon adoption.\n\n3. Fair Value of Financial Instruments\n\nThe Company’s cash equivalents are generally classified within Level 1 of the fair value hierarchy. The following tables present information about the Company’s financial assets measured at fair value on a recurring basis and indicate the level of the fair value hierarchy used to determine such fair values as of March 31, 2026 and December 31, 2025 (in thousands):\n\n \n\n \n\n \n\nFair Value Measurements as of March 31, 2026:\n\n \n\n \n\n \n\nLevel 1\n\n \n\n \n\nLevel 2\n\n \n\n \n\nLevel 3\n\n \n\n \n\nTotal\n\n \n\nCash equivalents:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nMoney market funds\n\n \n\n$\n\n2,610\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n2,610\n\n \n\nCash equivalents\n\n \n\n$\n\n2,610\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n2,610\n\n \n\n \n\n \n\n \n\nFair Value Measurements as of December 31, 2025:\n\n \n\n \n\n \n\nLevel 1\n\n \n\n \n\nLevel 2\n\n \n\n \n\nLevel 3\n\n \n\n \n\nTotal\n\n \n\nCash equivalents:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nMoney market funds\n\n \n\n$\n\n3,072\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n3,072\n\n \n\nCash equivalents\n\n \n\n$\n\n3,072\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n3,072\n\n \n\n \n\n \n\n15\n\n \n\nDuring the three months ended March 31, 2026 and 2025, there were no transfers between levels. The fair value of the Company’s cash equivalents, consisting of money market funds, is based on quoted market prices in active markets with no valuation adjustment.\n\nThe Company believes the carrying amounts of its accounts receivable, prepaid expenses and other current assets, accounts payable, and accrued expenses approximate their fair value due to the short-term nature of these amounts.\n\n4. Other Investment\n\n \n\nThe Company has determined that the Company’s investment in Tisento Parent is an equity security, whereby such investment does not give the Company a controlling financial interest or significant influence over the investee. Further, the Company assessed the accounting for its investment in Tisento Parent in accordance with ASC 810-10, Consolidation—Overall. After determining that no scope exception applies under the guidance of ASC 810-10-15-12 and ASC 810-10-15-17, the Company concluded that it has a variable interest in Tisento Parent through its investment in Tisento Parent common stock. Tisento Parent does not have sufficient equity to finance its activities without additional subordinated financial support as Tisento Parent is a startup entity in its early stages of raising funds and will require significant capital to advance its programs to commercial stage. Therefore, the Company concluded that its investment in Tisento Parent is a variable interest entity (“VIE”) in accordance with ASC 810-10-15-14(a) and is subject to potential consolidation under the VIE model. However, all activities that most significantly impact Tisento Parent and its subsidiary’s economic performance are directed by the Tisento Parent board and the board approves decisions by a simple majority. Based on the board composition, the Company determined that no one party has control over the Tisento Parent board and power is not shared because the activities that most significantly affect Tisento Parent and its subsidiary’s economic performance do not require the consent of all of the parties. Rather, all decisions are made by a simple majority vote of the Tisento Parent board. Therefore, because the Company controls no director of Tisento Parent, the Company cannot unilaterally direct any of the activities that most significantly impact Tisento Parent and its subsidiary’s economic performance. Accordingly, the Company does not hold a controlling financial interest in Tisento Parent. Because both criteria (a) and (b) above have to be met for the application of the guidance in ASC 810-10-25-44B and criteria (a) has not been met, the Company concluded that it should not consolidate Tisento under the VIE model.\n\n \n\nAccordingly, the Company has accounted for the investment as a financial instrument without a readily determinable fair value. Such investment is recorded using the measurement alternative for investments without readily determinable fair values, whereby the investment is measured at cost less any impairment recorded or adjustments for observable price changes. An impairment loss is recognized in the consolidated statements of operations and comprehensive loss equal to the amount by which the carrying value exceeds the fair value of the investment. As of March 31, 2026, no impairment loss was recognized. The Company considers the cost of the investment to be the maximum exposure to loss as a result of its involvement with the non-affiliated entity.\n\n5. Accrued Expenses and Other Current Liabilities\n\nAccrued expenses and other current liabilities consisted of the following (in thousands):\n\n \n\n \n\n \n\nMarch 31,\n\n \n\n \n\nDecember 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\nProfessional fees\n\n \n\n$\n\n984\n\n \n\n \n\n$\n\n143\n\n \n\nEmployee compensation\n\n \n\n \n\n21\n\n \n\n \n\n \n\n13\n\n \n\nOther\n\n \n\n \n\n104\n\n \n\n \n\n \n\n38\n\n \n\nAccrued expenses and other current liabilities\n\n \n\n$\n\n1,109\n\n \n\n \n\n$\n\n194\n\n \n\n \n\n6. Commitments and Contingencies\n\nOther Funding Commitments\n\nIn the normal course of business, the Company enters into contracts with clinical research organizations and other third parties for clinical and preclinical research studies and other services and products for operating\n\n \n\n16\n\n \n\npurposes. These contracts are generally cancellable, with notice, at the Company’s option and do not have any significant cancellation penalties.\n\n \n\nIndemnification Obligations\n\nOn September 6, 2018, Cyclerion was incorporated in Massachusetts and its officers and directors are indemnified for certain events or occurrences while they are serving in such capacity.\n\nThe Company enters into certain agreements with other parties in the ordinary course of business that contain indemnification provisions. These typically include agreements with directors and officers, business partners, contractors, clinical sites and customers. Under these provisions, the Company generally indemnifies and holds harmless the indemnified party for losses suffered or incurred by the indemnified party as a result of the Company’s activities. These indemnification provisions generally survive termination of the underlying agreements. The maximum potential amount of future payments the Company could be required to make under these indemnification provisions is unlimited. However, to date the Company has not incurred material costs to defend lawsuits or settle claims related to these indemnification provisions. As a result, the estimated fair value of these obligations is minimal. Accordingly, the Company did not have any liabilities recorded for these obligations as of March 31, 2026 and December 31, 2025.\n\n7. Share-based Compensation Plans\n\nIn 2019, Cyclerion adopted share-based compensation plans. Specifically, Cyclerion adopted the 2019 Employee Stock Purchase Plan (“2019 ESPP”) and the 2019 Equity Incentive Plan (“2019 Equity Plan”). Under the 2019 ESPP, eligible employees may use payroll deductions to purchase shares of stock in offerings under the plan, and thereby acquire an interest in the future of the Company. The 2019 Equity Plan provides for stock options, restricted stock awards (\"RSAs\") and restricted stock units (“RSUs”).\n\nCyclerion also mirrored two of Ironwood Pharmaceuticals, Inc. (\"Ironwood\") existing plans, the Amended and Restated 2005 Stock Incentive Plan (“2005 Equity Plan”) and the Amended and Restated 2010 Employee, Director and Consultant Equity Incentive Plan (“2010 Equity Plan\"). These mirror plans were adopted to facilitate the exchange of Ironwood equity awards for Cyclerion equity awards upon the Separation as part of the equity conversion. As a result of the Separation and in accordance with the EMA, employees of both companies retained their existing Ironwood vested options and received a pro-rata share of Cyclerion options, regardless of which company employed them post-Separation. For employees that were ultimately employed by Cyclerion, unvested Ironwood options and RSUs were converted to unvested Cyclerion options and RSUs.\n\nThe following table provides share-based compensation reflected in the Company’s condensed consolidated statements of operations and comprehensive loss for the three months ended March 31, 2026 and 2025 (in thousands):\n\n \n\n \n\n \n\nThree Months Ended\nMarch 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\nResearch and development\n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n12\n\n \n\nGeneral and administrative\n\n \n\n \n\n58\n\n \n\n \n\n \n\n102\n\n \n\n \n\n$\n\n58\n\n \n\n \n\n$\n\n114\n\n \n\n \n\nStock Options\n\nStock options granted under the Company’s equity plans generally have a ten-year term and vest over a period of four years, provided the individual continues to serve at the Company through the vesting dates. Options granted under all equity plans are exercisable at a price per share not less than the fair market value of the underlying common stock on the date of grant. The estimated fair value of options, including the effect of estimated forfeitures, is recognized over the requisite service period, which is typically the vesting period of each option.\n\nA summary of stock option activity for the three months ended March 31, 2026, is as follows:\n\n \n\n17\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nWeighted\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nWeighted\n\n \n\n \n\nAverage\n\n \n\n \n\nAverage\n\n \n\n \n\n \n\n \n\n \n\n \n\nAverage\n\n \n\n \n\nRemaining\n\n \n\n \n\nIntrinsic\n\n \n\n \n\n \n\nNumber\n\n \n\n \n\nExercise\n\n \n\n \n\nContractual\n\n \n\n \n\nValue (in\n\n \n\n \n\n \n\nof Options\n\n \n\n \n\nPrice\n\n \n\n \n\nTerm (Years)\n\n \n\n \n\nthousands)\n\n \n\nOutstanding as of December 31, 2025\n\n \n\n \n\n297,762\n\n \n\n \n\n$\n\n149.73\n\n \n\n \n\n \n\n4.9\n\n \n\n \n\n$\n\n—\n\n \n\nGranted\n\n \n\n \n\n—\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nExercised\n\n \n\n \n\n—\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCancelled or forfeited\n\n \n\n \n\n(17,355\n\n)\n\n \n\n$\n\n203.65\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOutstanding as of March 31, 2026\n\n \n\n \n\n280,407\n\n \n\n \n\n$\n\n146.39\n\n \n\n \n\n \n\n4.9\n\n \n\n \n\n$\n\n—\n\n \n\nExercisable at March 31, 2026\n\n \n\n \n\n220,760\n\n \n\n \n\n$\n\n181.20\n\n \n\n \n\n \n\n4.2\n\n \n\n \n\n$\n\n—\n\n \n\nThere were no options exercised during the three months ended March 31, 2026 and 2025. As of March 31, 2026, the unrecognized share-based compensation expense, net of estimated forfeitures, related to all unvested time-based stock options is $0.1 million and the weighted average period over which that expense is expected to be recognized is 2.86 years.\n\nThe Company has granted certain former employees performance-based options to purchase shares of common stock. These options are subject to performance-based milestone vesting. During the three months ended March 31, 2026 and 2025, there were no shares that vested as a result of performance milestone achievements. No share-based compensation expense related to these performance-based options was recognized during the three months ended March 31, 2026 and 2025, respectively.\n\n \n\nRestricted Stock Awards\n\nNo RSA was granted during the three months ended March 31, 2026 and 2025. The fair value of all RSAs is based on the market value of the Company’s common stock on the date of grant. Compensation expense, including the effect of estimated forfeitures, is recognized over the applicable service period.\n\nA summary of RSA activity for the three months ended March 31, 2026 is as follows:\n\n \n\n \n\n \n\n \n\n \n\nWeighted Average\n\n \n\n \n\n \n\nNumber\n\n \n\n \n\nGrant Date\n\n \n\n \n\n \n\nof Shares\n\n \n\n \n\nFair Value\n\n \n\nUnvested as of December 31, 2025\n\n \n\n \n\n104,078\n\n \n\n \n\n$\n\n2.57\n\n \n\nGranted\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nVested\n\n \n\n \n\n(15,024\n\n)\n\n \n\n \n\n2.52\n\n \n\nForfeited\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nUnvested as of March 31, 2026\n\n \n\n \n\n89,054\n\n \n\n \n\n$\n\n2.59\n\n \n\nAs of March 31, 2026, the unrecognized share-based compensation expense, net of estimated forfeitures, related to all unvested RSAs is $0.2 million and the weighted average period over which that expense is expected to be recognized is 1.45 years.\n\n \n\n18\n\n \n\n8. Loss per share\n\nBasic and diluted net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding during the period as follows:\n\n \n\n \n\nThree Months Ended\nMarch 31,\n\n \n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\nNumerator:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet loss (in thousands)\n\n \n\n$\n\n(3,177\n\n)\n\n \n\n$\n\n(1,429\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDenominator:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nWeighted average shares used in calculating net loss per share — basic and diluted (in thousands)\n\n \n\n \n\n4,205\n\n \n\n \n\n \n\n2,556\n\n \n\n \n\nNet loss per share — basic and diluted\n\n \n\n$\n\n(0.76\n\n)\n\n \n\n$\n\n(0.56\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nThe Company excludes shares of common stock related to Preferred Stock, stock options and RSAs from the calculation of diluted net loss per share since the inclusion of such shares would be anti-dilutive. The following table sets forth potential shares that were considered anti-dilutive for the three months ended March 31, 2026 and 2025:\n\n \n\n \n\n \n\nThree Months Ended March 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\nPreferred Stock\n\n \n\n \n\n351,037\n\n \n\n \n\n \n\n351,037\n\n \n\nStock Options\n\n \n\n \n\n280,407\n\n \n\n \n\n \n\n329,458\n\n \n\nRSAs\n\n \n\n \n\n89,054\n\n \n\n \n\n \n\n149,150\n\n \n\n \n\n \n\n720,498\n\n \n\n \n\n \n\n829,645\n\n \n\n \n\n9. Option/License Agreement\n\n \n\nPatent License Agreement\n\nOn September 19, 2025, the Company and MIT entered into a Patent License Agreement (the “MIT License Agreement”) pursuant to which MIT granted to the Company an exclusive worldwide license to develop and commercialize products using certain technology for the treatment of neuropsychiatric disorders, such as depression, in humans. Under the MIT License Agreement, the Company paid a nominal upfront license fee and patent reimbursement fee. Thereafter, the Company is also required to pay MIT a nominal annual license maintenance fee. This annual license maintenance fee is nonrefundable; however, the license maintenance fee may be credited to royalties earned during the same calendar year, if any. License maintenance fees paid in excess of royalties due in such calendar year shall not be creditable to amounts due for future years. Under the terms of the MIT License Agreement, MIT will be eligible to receive up to $4.4 million upon the achievement of certain development, regulatory and sales milestone payments. MIT will also receive tiered royalties in a range of percentages in the low single digits based on future net sales of licensed products as set forth in the MIT License Agreement. Further, the Company is required to pay MIT varying percentages of income received as consideration for any sublicenses granted pursuant to the MIT License Agreement depending on the circumstances of the sublicense and the development milestones of sublicensed products. The term of the MIT License Agreement will expire in its entirety upon the expiration of certain patent rights for the licensed patents, unless earlier terminated by the parties in accordance with the terms of the MIT License Agreement.\n\nNo expense was recognized for the three months ended March 31, 2026 and 2025 related to the license.\n\n \n\nAkebia License Agreement\n\nOn June 3, 2021, the Company and Akebia entered into a License Agreement (the “Akebia License Agreement”) relating to the exclusive worldwide license by the Company to Akebia of its rights to the development,\n\n \n\n19\n\n \n\nmanufacture, medical affairs and commercialization of pharmaceutical products containing the pharmaceutical compound known as praliciguat and other related products and forms thereof enumerated in the License Agreement (collectively, the “Products”). Pursuant to the Akebia License Agreement, Akebia will be responsible for all future research, development, regulatory, and commercialization activities for the Products.\n\nAkebia paid a $3.0 million up-front payment to the Company upon signing of the License Agreement. On December 13, 2024, the Company and Akebia entered into Amendment #1 to the License Agreement (the “2024 Amendment”) to the original License Agreement between the parties dated June 3, 2021.\n\nUnder the terms of the 2024 Amendment, Akebia paid $1.75 million in amendment payments, of which $1.25 million was paid in December 2024 and an additional payment of $0.5 million was paid in September 2025. In addition, Akebia has agreed to assume control of the preparation, filing, prosecution and maintenance of certain Cyclerion patents, and the expenses associated therewith, at an earlier date than as originally agreed between the parties. The parties have agreed to the reduction of certain development milestones and the increase of certain royalty rates on net sales and sublicense income. On December 1, 2025, Akebia publicly announced that it has recently initiated Phase 2 clinical trials for the treatment of focal segmental glomerulosclerosis (“FSGS”) using praliciguat. Pursuant to the terms of amendment, upon initiation of a Phase 2 clinical trial in the U.S. for a product, a $1.0 million development milestone payment would be due to the Company and which was received in February 2026. Pursuant to the terms of the Akebia License Agreement, as amended, Cyclerion is eligible to receive additional potential future development, regulatory, and commercialization milestone payments up to $557.5 million in total, and Akebia will pay Cyclerion tiered royalties ranging from mid-single digit to twenty percent of net sales. Cyclerion’s obligations to deliver certain drug products have also ceased.\n\nPursuant to the Akebia License Agreement, the Company determined the Akebia License Agreement represents a service arrangement under the scope of ASC 606. Given the reversion of the rights under the Akebia License Agreement represents a penalty in substance for a termination by Akebia, the contract term would be the stated term of the License Agreement.\n\nThe Company determined that the grant of license to its patents and trademarks, know how transfer, the assignment of regulatory submissions and trademarks and additional knowledge transfer assistance obligations represent a single promise and performance obligation to be transferred to Akebia over time due to the nature of the promises in the contract. The provision of development materials on hand was identified as a separate performance obligation. However, it is immaterial in the context of the contract as the development materials are low value and do not have an alternative use to the Company.\n\nThe consideration related to sales-based milestone payments, including royalties, will be recognized when the related sales occur as these amounts have been determined to relate predominantly to the license. The Company will re-evaluate the probability of achievement of the milestones and any related constraints each reporting period.\n\n \n\nAkebia Material Purchase Agreement\n\nOn September 3, 2025, the Company and Akebia entered into a Material Purchase Agreement (the “Purchase Agreement”) relating to the purchase of additional development materials (the \"Additional Development Materials\") by Akebia for Akebia's use pursuant to the Akebia License Agreement. Akebia paid $0.8 million to the Company for the purchase during the year ended December 31, 2025 and the Additional Development Materials were delivered to Akebia as of December 31, 2025.\n\nThe Company determined the Purchase Agreement has stand-alone value under the scope of ASC 606 and should not be combined with the Akebia License Agreement or the Amendment. The delivery of the Additional Development Materials by the Company represents a single performance obligation and consideration was recognized upon delivery. No revenue was recognized under the Purchase Agreement during three months ended March 31, 2026 and 2025.\n\nOption Agreement\n\nOn July 22, 2024, the Company entered into an Option to License Agreement (the “Option Agreement”) with a third party (the “Optionee”), pursuant to which the Optionee had an option (the “Option”) to enter into an\n\n \n\n20\n\n \n\nexclusive license to olinciguat for human therapeutics, subject to certain carveouts. Under the terms of the Option Agreement, the Optionee paid the Company an Option fee of $150,000 in August 2024 and subsequent fees totaling $80,000 to extend the term of the Option Agreement. The Optionee originally could exercise the Option on or before March 20, 2025, which option period was ultimately extended through August 22, 2025. Thereafter, the parties had an additional 60 days to negotiate the terms of a definitive license agreement. The parties were unable to agree upon the terms of a license agreement and the Company provided notice on October 23, 2025 that it was terminating the Option Agreement. The Company recognized revenue of $0.1 million related to the extension fee payment and expense reimbursement for the three months ended March 31, 2025.\n\nMedsteer Collaboration Agreement\n\nOn January 3, 2026, the Company and the Medsteer, SAS (“Medsteer”) entered into a Collaboration and Option Agreement (the “Collaboration Agreement”) pursuant to which Medsteer granted to the Company (i) a non-exclusive, worldwide, royalty-free, sublicensable license of certain of Medsteer’s technology, software and intellectual property to develop an anesthetic delivery system with Medsteer and (ii) an exclusive option (the “Option”), exercisable at the Company’s sole discretion, to obtain an exclusive, worldwide, royalty-bearing, sublicensable license of certain of Medsteer’s technology, software and intellectual property to develop or commercialize licensed products in any field of use except for sedation regulation for patients undergoing major surgery, in multi-bed or intensive unit wards, or in the context of medical transport. The Company may exercise the Option at any time until the earlier of the second anniversary of the effective date of the Collaboration Agreement, which period may be extended for an additional two years at the Company’s option and upon payment of a nominal fee or by mutual agreement of the Company and Medsteer. Under the terms of the Collaboration Agreement, the Company recognized $0.1 million research and development expense during the three months ended March 31, 2026, which is related to the upfront payment paid to Medsteer and other transaction costs. Medsteer will be eligible to receive up to $3.7 million upon the achievement of certain development, regulatory and sales milestone payments. Medsteer will also receive an annual royalty payment and royalties in a percentage in the low single digits based on future net sales of licensed products, subject to certain adjustments as set forth in the Collaboration Agreement.\n\n \n\n10. Subsequent Events\n\nAs described above, on April 1, 2026, the Company entered into the Merger Agreement (which was subsequently amended on April 17, 2026) with Korsana, a privately held biotechnology company discovering and developing novel therapies to reduce the burden of neurodegenerative diseases, pursuant to which Korsana will become a wholly owned subsidiary of the Company and the Company will operate under the name Korsana Biosciences, Inc. following the merger. The Company anticipates that the merger will close in the third quarter of 2026, subject to certain closing conditions, along with the concurrent Korsana pre-closing financing. Following the merger, the current business of Korsana will become the primary business of the Company.\n\n \n\n \n\n \n\n21"}