HALO

• The company states there have been no material changes in its market risks during the quarter ended June 30, 2026.
• Cash equivalents and marketable securities are held in money market funds and U.S. Treasury securities under a policy prioritizing principal preservation.
• A hypothetical immediate 10% change in interest rates is not expected to materially impact results of operations based on the current portfolio.
• A portion of forecasted Swiss-franc-denominated royalty revenue is hedged using cash flow hedges to reduce foreign exchange risk.
• Hedge gains and losses are recorded in AOCI and reclassified to royalty revenue when the underlying transaction is recognized.
• The company does not use derivatives or other financial instruments for speculative trading and sees no significant default or illiquidity risk in its holdings.

From time to time, we may be involved in disputes, including litigation, relating to claims arising out of operations in the normal course of our business. Any of these claims could subject us to costly legal expenses and, while we generally believe that we have adequate insurance to cover many different types of liabilities, our insurance carriers may deny coverage or our policy limits may be inadequate to fully satisfy any damage awards or settlements. If this were to happen, the payment of any such awards could have a material adverse effect on our condensed consolidated statements of income and balance sheets. Additionally, any such claims, whether or not successful, could damage our reputation and business. We currently are not a party to any legal proceedings, the adverse outcome of which, in our opinion, individually or in the aggregate, would have a material adverse effect on our condensed consolidated statements of income or balance sheets.

• An Executive Order and CMS guidance under the IRA create uncertainty around price negotiations, especially for ENHANZE combination therapies.
• CMS's June 2026 proposed rule could aggregate certain fixed-combination products with shared active ingredients for price negotiation, potentially expanding exposure.
• Third-party payers, including consolidated PBMs and insurers, are demanding higher discounts and rebates, limiting patient access and pressuring net pricing.
• State-level drug-pricing legislation and international regulatory issues compound the risk of mandatory price controls and importation.
• Complex government price-reporting rules expose the company to fines, penalties, and additional rebates if submitted data is incorrect.