CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q includes “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, as amended, and “forward-looking information” within the meaning of Canadian securities laws, or collectively, forward-looking statements. Forward-looking statements include statements that may relate to our plans, objectives, goals, strategies, future events, future revenue or performance, capital expenditures, financial position, financing needs and other information that is not historical information. Many of these statements appear, in particular, under the headings “Business”, “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”. Forward-looking statements can often be identified by the use of terminology such as “subject to”, “believe,” “anticipate,” “plan,” “expect,” “intend,” “estimate,” “project,” “may,” “will,” “should,” “would,” “could,” “can,” the negatives thereof, variations thereon and similar expressions, or by discussions of strategy. In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking. In particular, these forward-looking statements include, but are not limited to: •our expectations regarding the success, clinical advancement, and market acceptance of our internal pipeline of drug candidates, including expectations regarding the preliminary, top-line, or early-stage clinical data for ABCL635, as well as our antibody discovery and development capabilities; •companies and technologies in our industry that compete with our business and our internal drug candidates; •our ability to manage and grow our business by advancing our internal pipeline of drug candidates through clinical development and introducing our antibody discovery and development capabilities to new partners and expanding our relationships with existing partners; •our estimates of market opportunity and forecasts of market growth may prove to be inaccurate, and even if these markets achieve the forecasted growth, our drug candidates may fail to achieve sufficient market acceptance or adoption; •our ability to achieve projected discovery, preclinical development, and clinical milestones for our internal programs, including the top-line data from the Phase 2 trial anticipated in August of 2026 for ABCL635, as well as our partners’ ability to achieve projected discovery and development milestones and other anticipated key events, including commercial sales resulting in royalties owed to us, in the expected timelines or at all; •our ability to leverage our full platform capabilities - from target identification to Investigational New Drug (“IND”) application submission and to clinical development - to advance our internal pipeline of drug candidates, as well as to support our partners; •our ability to develop and commercialize the drugs we discover, both internally and with our partners, on a timely basis or at all; •our operating results, financial performance, and financial position; •our expectations regarding our good manufacturing practices, or GMP, facility and our manufacturing capabilities to support our clinical trials; •our ability to establish and maintain intellectual property protection for our internal drug candidates, technologies and workflows and avoid or defend against claims of patent infringement; •our ability to attract, hire and retain key personnel and to manage our personnel growth effectively; •our ability to obtain additional financing in future offerings; •the volatility of the trading price of our common shares, including in response to the market's reaction to near-term clinical milestones; •business disruptions affecting our operations, the advancement of our internal pipeline, and the development of our antibody discovery, preclinical development and clinical development capabilities; •our ability to avoid material weaknesses or significant deficiencies in our internal control over financial reporting in the future; •our expectations regarding our Passive Foreign Investment Company, or PFIC, status for our taxable year ended December 31, 2026, or any future taxable year; 12 •our expectations regarding the use of our cash resources; •our expectations about market trends; and •our ability to predict and adapt to government regulation. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements, and you should not place undue reliance on the forward-looking statements. Actual results or events could differ materially from the plans, intentions, and expectations disclosed in our forward-looking statements. We have included important factors in the cautionary statements included in this Quarterly Report, particularly in “Summary of the Material and Other Risks Associated with Our Business” above and “Risk Factors” below, that we believe could cause actual results or events to differ materially from our forward-looking statements. We operate in a competitive and rapidly changing environment and new risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, collaborations, joint ventures, or investments we may make or enter into. Additionally, military conflicts, specifically the escalating conflict in the Middle East beginning in 2026, can adversely affect our business and financial statements. This dynamic situation has disrupted global supply chains, increased energy and operational costs, created capital market volatility, and heightened cybersecurity risks. A protraction or escalation of hostilities could further intensify these impacts. Beyond these conflicts, broader macroeconomic inflation generally affects us by increasing our employee-related costs and certain other expenses. Our financial condition and results of operations may also be impacted by other factors we may not be able to control, such as global supply chain disruptions, potential trade tariffs in Canada and the U.S., uncertain global economic conditions, global trade disputes or political instability, as further discussed in the section “Risk Factors” in this Quarterly Report. You should read this Quarterly Report and the documents that we file with the Securities and Exchange Commission, or the SEC, with the understanding that our actual future results may differ materially from what we expect. The forward-looking statements contained in this Quarterly Report are made as of the date of this Quarterly Report, and we do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law or regulation. In addition, statements that “we believe” and similar statements reflect our current beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely upon these statements. This Quarterly Report includes statistical and other industry and market data that we obtained from industry publications and research, surveys, and studies conducted by third parties as well as our own estimates of potential market opportunities. All market data used in this Quarterly Report involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such data. Industry publications and third-party research, surveys, and studies generally indicate that their information has been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information. Our estimates of the potential market opportunities for our product candidates include several key assumptions based on our industry knowledge, industry publications, third-party research, and other surveys, which may be based on a small sample size and may fail to accurately reflect market opportunities. While we believe that our internal assumptions are reasonable, no independent source has verified such assumptions. We express all amounts in this Quarterly Report on Form 10-Q in U.S. dollars, except where otherwise indicated. References to “$” and “US$” are to U.S. dollars and references to “C$” and “CAD$” are to Canadian dollars. Except as otherwise indicated, references in this Quarterly Report on Form 10-Q to “AbCellera,” the “Company,” “we,” “us” and “our” refer to AbCellera Biologics Inc. and its consolidated subsidiaries. Overview AbCellera is a clinical-stage biotechnology company focused on discovering and developing antibody-based medicines for indications with high unmet medical need. To maximize the value and impact of our work, we are advancing a pipeline of internal programs and strategically partnering with companies that have novel science, innovative technology, or a strong track record of bringing programs through clinical development. 13 We focus on the development of antibody drugs and are committed to improving discovery and development. We aim to build a competitive advantage in bringing antibody drugs from target into clinical testing by combining expertise, technologies, and infrastructure to build integrated capabilities for antibody drug discovery and development. We think deeply about capital allocation and strive to maximize long-term value while mitigating the risks that are inherent in drug development. We look for opportunities where we believe low-risk investments in building technology and operational efficiency can create a sustained competitive advantage and drive long-term value by making antibody drug development faster and more efficient. We are leveraging our platform to develop internal programs and advance a pipeline of AbCellera-led programs with first-in-class potential. We evaluate these programs individually to determine whether to pursue preclinical and clinical development in-house, enter into collaborations with partners, or out-license to optimize their development and clinical and commercial potential. We expect to continue to make significant investments in this area for the foreseeable future and expect to continue to incur significant expenses in connection with our ongoing activities, including as we: •invest in research and development activities to improve our antibody discovery and development capabilities; •advance our internal programs in preclinical and clinical development; •improve and enhance operations to deliver programs, including investments in manufacturing; •acquire businesses or technologies to support the growth of our business; •attract, hire and retain qualified personnel; and •continue to establish, protect and defend our intellectual property and patent portfolio, including our ongoing litigation. To date, we have financed our operations primarily from revenue from our antibody discovery partnerships in the form of royalty revenue, government funding from grants, and from the issuance and sale of convertible preferred shares and notes, and common shares. Additionally, we have twice secured significant government co-investments in the form of non-dilutive capital to help fund research and development, including internal programs, and facility construction. We previously achieved critical regulatory and clinical trial milestones for ABCL635 and ABCL575, and initiated dosing participants in clinical trials for both programs in Canada during the second half of 2025. For ABCL635, the Phase 1/2 clinical trial is a randomized, placebo-controlled, double-blind study in healthy men and postmenopausal women with or without vasomotor symptoms (VMS). Its purpose is to evaluate safety, pharmacokinetics, pharmacodynamics, as well as frequency and severity of VMS with subcutaneous doses of ABCL635. In January 2026, following an interim assessment of the safety, tolerability, and pharmacodynamic data collected from healthy volunteers in the Phase 1 portion of the study, we announced the dosing of first patients in the Phase 2 portion of the ongoing Phase 1/2 clinical trial. In May 2026, we announced positive interim Phase 1 data for ABCL635. Treatment with ABCL635 achieved potent and sustained reduction in biomarkers of target engagement, demonstrated a favorable tolerability profile with no observed liver toxicity or serious adverse events reported to date, and pharmacokinetic data supports monthly dosing. Enrollment of the Phase 2 study has been completed and the top-line data readout is expected in August. For ABCL575, the Phase 1 clinical trial is a randomized, placebo-controlled, double-blind study to assess safety and tolerability in healthy participants following subcutaneous doses of ABCL575. Dosing for the Phase 1 study has been completed with the top-line data readout expected in Q4 2026. At present, we have no plans to pursue development past Phase 1. In 2025, we advanced ABCL688 and ABCL386 into IND/CTA-enabling studies. ABCL688 is an antibody drug candidate for an undisclosed indication in autoimmunity and is the second program from our G protein-coupled receptor (GPCR) and ion channel platform to advance into IND/CTA-enabling studies. We anticipate submission of an IND/CTA for ABCL688 in 2027. ABCL386 is an antibody drug candidate against an undisclosed target in oncology. ABCL386 is in IND/CTA-enabling activities, and we anticipate initiating Phase 1/2 clinical trials in patients in 2027. Both programs align with the Company's strategy of building value, through partnerships, and through internal discovery and development of potential first-in-class antibody drugs. 14 Financial Highlights The following table summarizes our key operating results for the three and six months ended June 30, 2025 and June 30, 2026. All figures are in U.S. dollars and amounts are expressed in thousands, except loss per share data: Three months ended June 30, Six Months Ended June 30, Financial Performance 2025 2026 2025 2026 Revenue: Research fees $ 6,639 $ 3,901 $ 10,707 $ 12,021 Licensing and royalty revenue 10,445 149 10,613 341 Total revenue 17,084 4,050 21,320 12,362 Operating expenses: Research and development(1) 39,213 45,987 81,711 92,649 Other operating expenses 27,456 20,840 51,855 40,013 Total operating expenses 66,669 66,827 133,566 132,662 Loss from operations (49,585) (62,777) (112,246) (120,300) Other income (13,241) (3,812) (22,918) (11,799) Loss before income tax (36,344) (58,965) (89,328) (108,501) Net loss $ (34,727) $ (55,427) $ (80,348) $ (98,592) Net loss per share Basic $ (0.12) $ (0.18) $ (0.27) $ (0.32) Diluted $ (0.12) $ (0.18) $ (0.27) $ (0.32) Stock-based compensation included within operating expenses: Research and development expenses 7,506 6,714 15,642 13,753 Sales, general, and administrative expenses 6,702 5,572 13,351 10,546 Financial Position December 31, 2025 June 30, 2026 Cash and cash equivalents 128,513 120,065 Marketable securities 405,313 420,039 Total cash, cash equivalents, and marketable securities 533,826 540,104 Total assets 1,356,950 1,307,575 Total shareholders' equity 966,904 896,020 (1)Exclusive of depreciation and amortization Recent Developments and Clinical Update In January 2026, following an interim review of safety, tolerability, and pharmacodynamic data from healthy volunteers in the Phase 1 portion of the ABCL635 Phase 1/2 clinical trial, we announced the dosing of first patients in the Phase 2 portion of the study. In May 2026, we announced positive interim Phase 1 data for ABCL635. Treatment with ABCL635 achieved potent and sustained reduction in biomarkers of target engagement, demonstrated a favorable safety profile with all doses well-tolerated and no observed liver toxicity or serious adverse events, and pharmacokinetic data supported monthly dosing. Enrollment of the Phase 2 study has been completed and the top-line data readout is expected in August of 2026. In June 2026, we entered into a preclinical research collaboration, option, and license agreement with Jazz Pharmaceuticals PLC (Jazz) to discover and develop next-generation T-cell engaging (TCE) multispecific antibodies. Under the agreement, we received a $56.0 million non-refundable upfront payment in the quarter to perform discovery and early-stage research activities for two initial programs, with an additional $28.0 million due upon the initiation of a third program within 12 months. Jazz holds exclusive options to develop and commercialize each program. If Jazz exercises these options, we are eligible to receive up to $792.0 million per program in option fees and milestone payments, as well as tiered royalties on 15 net sales ranging from mid-single digits to low double-digits. The agreement also provides a mechanism to mutually initiate up to two additional programs, and for us to conduct certain investigational new drug (IND)-enabling studies and manufacture clinical supply for any program under the collaboration. In July 2026, we entered into a collaboration agreement with Vertex Pharmaceuticals Inc. (Vertex) to research, develop, manufacture, and commercialize multispecific T-cell engagers for autoimmune diseases and other conditions. Under the terms of the agreement, we will lead discovery and early development activities, and Vertex will fund all research and development costs while retaining the right to develop and commercialize resulting therapeutic multispecific antibodies. We received $28.0 million in total upfront payments upon the execution of the agreement and are eligible to receive preclinical, development, regulatory, and commercial milestone payments, plus tiered royalties on net sales. Additionally, the parties may mutually agree to have us perform cell-line development, process development, and clinical manufacturing through Phase 1 for any program under the collaboration. Key Factors Affecting Our Results of Operations and Future Performance We believe that our financial performance has been, and in the foreseeable future will continue to be, primarily driven by multiple factors as described below, each of which presents growth opportunities for our business. These factors also pose important challenges that we must successfully address to sustain our growth and improve our results of operations. Our ability to successfully address these challenges is subject to various risks and uncertainties, including those described in Part II, Item 1A, Risk Factors. •Pursuing drug discovery and development opportunities internally. As our discovery and development capabilities have matured, we are increasingly in a position to pursue attractive, well-validated targets ourselves, e.g. in the GPCR, ion channel, and TCE spaces. Such programs have the potential to yield first-in-class drug candidates in indications with substantial unmet medical need which we can pursue internally. We plan on investing significant resources in the preclinical and clinical development of internal programs that will impact our financial results. The investments in each program are undertaken at risk and may ultimately not yield a return. •Successfully designing and executing clinical trials. Our long-term financial success is increasingly dependent on our ability to successfully transition drug candidates from our discovery platform through clinical development. The successful execution of our current and future clinical trials requires significant financial investment. We intend to allocate resources to the design and execution of these clinical trials, which represent a substantial and ongoing commitment of capital and personnel. Our ability to generate future value from these programs, whether through independent development or strategic out-licensing, will depend on the clinical data generated. •Successfully out-licensing drug candidates from our internal programs. We believe that our internal programs may result in drug candidates of interest to other drug developers with capabilities complementary to our own. Where these capabilities can be expected to enhance the value of our drug candidate, we may seek to out-license. Successful out-licensing agreements could generate substantial upfront payments in addition to later milestone payments and royalties. Our financial performance may therefore be impacted by our ability to produce and out-license such drug candidates from our internal programs. •Our partners successfully developing and commercializing the antibodies that we discover. We estimate that, based on the terms of our existing contracts and estimates of historical rates of success of antibody drug development, the vast majority of the potential value for each program is represented by potential future milestone payments and royalties rather than research fees. As a result, we believe our business and our future results of operations will be highly impacted by the degree to which our partners successfully develop and commercialize the antibodies that we have discovered based on contracts with our partners. As our partners continue to advance development of the antibodies that we have discovered, we expect to start receiving additional milestone payments and royalties if any partners commence commercial sales of such antibodies. •Engaging with partners. Our potential to grow revenue, in both the near and long-term, is dependent on successfully engaging with partners. We seek to expand our relationships with existing partners also as a basis for potentially out-licensing some of our internal programs. Our teams are selective in determining which partners we choose to engage with, focusing on the opportunities with the strong potential to generate significant value in the long-term. •Investing in enhancements to our discovery and development capabilities. Our ability to generate a pipeline of potential first-in-class internal programs and expand our partnerships is dependent on the strength and advantages of our discovery and development capabilities. We intend to maintain our leading position through 16 selective investments in research and development to refine and add capabilities, including in manufacturing. We have also successfully executed and will continue to look for strategic technology acquisitions to improve, broaden and deepen our capabilities and expertise in antibody discovery and development, or those that offer opportunities to expand our business into adjacent therapeutic modalities. We intend to continue to devote resources to continue to improve our discovery differentiation which will impact our financial performance. Business Metrics We regularly review the following business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections and make strategic decisions. We believe that the following metrics are important to understand our current business. These metrics may change or may be substituted for additional or different metrics as our business develops as further described below with respect to changes in this and upcoming reports. December 31, 2025 June 30, 2026 Partner-led programs with downstreams 44 35 In the clinic 5 3 In discovery or preclinical development 39 32 Molecules in the clinic with downstreams 14 12 The table below outlines the details of molecules in the clinic as of June 30, 2026: Molecule Stage Partner1 Therapeutic area(s) Program Type ABCL635 Phase 2 n/a Endocrinology / Women’s Health AbCellera-led ABCL575 Phase 1 n/a Immunology & Inflammation AbCellera-led Undisclosed Phase 1 Teva Pharmaceutical Industries Ltd. Neuroscience Partner-led Undisclosed Pivotal studies Dechra Pharmaceuticals Animal Health Partner-led IVX-01 Clinical field study Dechra Pharmaceuticals Animal Health Partner-led AB-2100 Phase 1/2 Arsenal Bio Oncology Trianni license AB-3028 Phase 1/2 Arsenal Bio Oncology Trianni license GIGA-564 Phase 1 GigaGen, Inc. Oncology Trianni license NBL-012 Phase 2-ready2 NovaRock Biotherapeutics Inc. Dermatology, Gastrointestinal, Immunology Trianni license NBL-015/FL-301 Phase 12 NovaRock Biotherapeutics Inc. Oncology Trianni license NBL-020 Phase 12 NovaRock Biotherapeutics Inc. Oncology Trianni license NBL-028 Phase 12 NovaRock Biotherapeutics Inc. Oncology Trianni license 1 If partner-led 2 As represented by partner Partner-led programs with downstreams represent the number of unique partner-led programs where we stand to participate financially in downstream success. Included are programs (i) for which we have commenced the discovery 17 effort and (ii) which, to the best of our knowledge, our partners are progressing towards drug approval on the reporting date. The discovery effort commences on the later of (i) the day on which we receive sufficient reagents to start discovery of antibodies against a target and (ii) the day on which the kick-off meeting for the program is held. We exclude from the metric all programs where, based on our reasonable efforts to monitor program status, we have reason to believe that no further resources are being, or will be, invested by our partner to advance the program towards eventually producing a marketed drug. Partner-led programs with downstreams indicate our total opportunities to earn downstream revenue from milestone fees and royalties (or royalty equivalents) in the mid- to long-term. Molecules in the clinic with downstreams represent the count of unique molecules for (i) which an Investigational New Drug, or IND, New Animal Drug, or equivalent under other regulatory regimes, application has reached “open” status or has otherwise been approved based on an antibody that was discovered either by us or by a partner using licensed AbCellera technology and (ii) which, to the best of our knowledge, our partners are progressing towards drug approval on the reporting date. Where the date of such application approval is not known to us, the date of the first public announcement of a clinical trial will be used for the purpose of this metric. We determine whether a program is progressing towards drug approval based on the best information available to us at the reporting date. We view this metric as an indication of our near- and mid-term potential revenue from milestone fees, potential royalty payments, or profits from sales of approved drugs in the long-term. For AbCellera-led programs, our knowledge of a program’s status is complete and our economic stake is large. Our visibility into partner-led programs stemming from our AbCellera platform is often limited and our economic stake small. Trianni-license programs afford us the least visibility and typically the smallest economic stake. Results of Operations Comparison of the three and six months ended June 30, 2025 and June 30, 2026: Revenue Three Months Ended June 30, Change Six Months Ended June 30, Change 2025 2026 Amount % 2025 2026 Amount % Revenue: Research fees $ 6,639 $ 3,901 $ (2,738) (41) % $ 10,707 $ 12,021 $ 1,314 12 % Licensing and royalty revenue 10,445 149 (10,296) (99) % 10,613 341 (10,272) (97) % Total revenue $ 17,084 $ 4,050 $ (13,034) (76) % $ 21,320 $ 12,362 $ (8,958) (42) % Revenue decreased by $13.0 million from the three months ended June 30, 2025 compared to the three months ended June 30, 2026 and decreased $9.0 million from the six months ended June 30, 2025 compared to the six months ended June 30, 2026. The decrease is attributable to licensing revenue recognized in the second quarter of 2025 and the timing and progress of our research and development efforts. We expect research fee revenues in future periods to be positively impacted as we perform our research obligations and recognize revenue from the upfront payments received under our recent collaborations with Jazz and Vertex, as further detailed in "Recent Developments". Operating Expenses Research and Development Three Months Ended June 30, Change Six Months Ended June 30, Change 2025 2026 Amount % 2025 2026 Amount % Research and development $ 39,213 $ 45,987 $ 6,774 17 % $ 81,711 $ 92,649 $ 10,938 13 % Research and development activities consist of investments in internal programs, partner discovery research, clinical trials, and capability enhancements. At any given time, we have a number of active preclinical, discovery, and clinical programs. Because our personnel and infrastructure are typically deployed across an extensive portfolio of 18 programs simultaneously, we generally do not allocate personnel-related expenses (including stock-based compensation), facilities, and other shared overhead on a program-specific basis. Accordingly, we track, manage, and evaluate these internal costs on an aggregated, unallocated basis. Total research and development expenses increased by $6.8 million, or 17%, from the three months ended June 30, 2025, compared to the three months ended June 30, 2026. Of the total increase, external clinical program costs were $5.1 million for the three months ended June 30, 2026 compared to $0.8 million for the three months ended June 30, 2025, as ABCL575 and ABCL635 entered the clinic towards the end of the second quarter of 2025. Preclinical and discovery costs were $6.9 million and remained consistent period over period. Total compensation expense, including stock-based compensation, was $22.2 million for the three months ended June 30, 2026 and remained substantially unchanged compared to the prior period. Similarly, unallocated internal costs of $11.7 million for the three months ended June 30, 2026 were consistent period over period. Total research and development expenses increased by $10.9 million, or 13%, from the six months ended June 30, 2025, compared to the six months ended June 30, 2026. Of the total increase, external clinical program costs were $9.0 million for the six months ended June 30, 2026 compared to $0.7 million for the six months ended June 30, 2025, as ABCL575 and ABCL635 entered the clinic in the end of the second quarter of 2025. Preclinical and discovery costs decreased by $2.2 million period-over-period to $15.0 million, primarily driven by prior-period preclinical spend from ABCL635 and ABCL575 IND/CTA-enabling activities. Total compensation expense, including stock-based compensation, was $45.7 million for the six months ended June 30, 2026 and remained substantially unchanged compared to the prior period. Unallocated internal costs of $23.0 million for the six months ended June 30, 2026 increased by $3.6 million compared to the six months ended June 30, 2025 due to clinical manufacturing activities and the use of materials and supplies. Sales, General, and Administrative Three Months Ended June 30, Change Six Months Ended June 30, Change 2025 2026 Amount % 2025 2026 Amount % Sales, general, and administrative $ 21,986 $ 13,850 $ (8,136) (37) % $ 41,054 $ 26,185 $ (14,869) (36) % Sales, general, and administrative expenses decreased by $8.1 million, or (37)%, from the three months ended June 30, 2025 compared to the three months ended June 30, 2026 and decreased by $14.9 million, or (36)%, from the six months ended June 30, 2025 compared to the six months ended June 30, 2026. Total compensation expense, inclusive of stock-based compensation, was $11.3 million for the three months ended June 30, 2025, compared to $8.8 million for the three months ended June 30, 2026 and $22.3 million for the six months ended June 30, 2025, compared to $17.9 million for the six months ended June 30, 2026. The decrease in compensation expense is a result of our continued optimization of headcount in light of our internal pipeline focus. Legal, software, and other general administrative costs were $10.7 million for the three months ended June 30, 2025, compared to $5.0 million for the three months ended June 30, 2026 and $18.8 million for the six months ended June 30, 2025 compared to $8.3 million for the six months ended June 30, 2026. The decrease was primarily due to a legal settlement in December 2025 and a resulting reduction in legal fees incurred in 2026. Depreciation and Amortization Three Months Ended June 30, Change Six Months Ended June 30, Change 2025 2026 Amount % 2025 2026 Amount % Depreciation and amortization $ 5,470 $ 6,990 $ 1,520 28 % $ 10,801 $ 13,828 $ 3,027 28 % Depreciation and amortization expense increased by $1.5 million, or 28%, from the three months ended June 30, 2025 compared to the three months ended June 30, 2026 and increased by $3.0 million, or 28%, from the six months ended June 30, 2025 compared to the six months ended June 30, 2026. The increase was primarily due to the commencement of depreciation of our clinical manufacturing facility that was put in service in December 2025. 19 Interest and Other (Income) Expense Three Months Ended June 30, Change Six Months Ended June 30, Change 2025 2026 Amount % 2025 2026 Amount % Interest and other $ (9,549) $ 42 $ 9,591 (100) % $ (15,073) $ (3,606) $ 11,467 (76) % Interest and other income decreased by $9.6 million, or (100)%, from the three months ended June 30, 2025 compared to the three months ended June 30, 2026 and decreased by $11.5 million, or (76)%, from the six months ended June 30, 2025 compared to the six months ended June 30, 2026. The decrease was primarily driven by foreign exchange in the period due to fluctuations in the Canadian and U.S. dollar exchange rate, interest income driven by our cash, cash equivalents, and marketable securities balances and interest rate yields in the period, and other fair value adjustments. Grants and Incentives Three Months Ended June 30, Change Six Months Ended June 30, Change 2025 2026 Amount % 2025 2026 Amount % Grants and incentives $ (3,692) $ (3,854) $ (162) 4 % $ (7,845) $ (8,193) $ (348) 4 % Grants and incentives increased by $0.2 million, or 4%, from the three months ended June 30, 2025 compared to the three months ended June 30, 2026 and increased by $0.3 million, or 4%, from the six months ended June 30, 2025 compared to the six months ended June 30, 2026. The change was primarily driven by activity relating to research and development expenditures that are eligible for reimbursement under government programs for the period. Income Tax Recovery Three Months Ended June 30, Change Six Months Ended June 30, Change 2025 2026 Amount % 2025 2026 Amount % Income tax recovery $ (1,617) $ (3,538) $ (1,921) 119 % $ (8,980) $ (9,909) $ (929) 10 % Income tax recovery increased by $1.9 million from the three months ended June 30, 2025 compared to the three months ended June 30, 2026 and increased by $0.9 million from the six months ended June 30, 2025 compared to the six months ended June 30, 2026. The increase was primarily driven by the availability of carry-back of losses to recover previously paid taxes. Liquidity and Capital Resources As of June 30, 2026, we had $540.1 million of cash, cash equivalents and marketable securities, comprising $120.1 million in cash and cash equivalents and $420.0 million in marketable securities. The increase of $6.3 million since December 31, 2025, was primarily driven by the full receipt of a $36.0 million litigation settlement, of which was receivable at December 31, 2025, and a $56.0 million upfront payment to discover and develop next-generation T-cell engaging (TCE) multispecific antibodies. This was partially offset by cash flow used in operations due to our continued research and development activity for internal programs in discovery, preclinical, and clinical development as well as for partnered programs. We intend to continue to invest in research and development efforts towards expanding our capabilities and expertise, grow and advance our internal pipeline. Simultaneously, we intend to optimize our long-term office-lease arrangements and intend to assign or fully sublease the office and laboratory space constructed through the Beedie JV. We substantially completed our final large platform investments in our clinical manufacturing facility and our corporate headquarters in 2025. With the completion of these large platform investments, we expect a reduction in investing cash outflows, shifting our capital allocation from building capabilities to using them as we execute our strategy of building on our internal pipeline. Based on our current business plan, we believe that our available liquidity from existing total cash balances (cash, cash equivalents, and restricted cash), marketable securities, and government contributions, will be sufficient to meet our working capital and capital expenditures over at least the next 36 months following the date of this report. Government of Canada and Government of British Columbia Contributions In May of 2023, we entered into multi-year contribution agreements with the Government of Canada and the Government of British Columbia. Under the agreements, up to $166.7 million ($225.0 million CAD) and $55.6 million 20 ($75.0 million CAD) was committed by the Government of Canada and the Government of British Columbia, respectively, to build new capabilities in Canada to develop, manufacture, and deliver antibody medicines to patients through Phase 1 clinical trials and build expertise in translational science, technical operations, and clinical operations and research. At June 30, 2026, our government contribution agreements provided an estimated CAD $156.1 million ($110.0 million) in total available funding eligible for future claims. See the notes to our condensed consolidated financial statements for further information related to the government contributions. Cash Flows The following table summarizes our cash flows for the periods presented: Six Months Ended June 30, 2025 2026 Net cash provided by (used in): Operating activities $ (43,958) $ (7,600) Investing activities (23,876) (13,740) Financing activities 2,595 13,585 Effect of exchange rate changes on cash and cash equivalents 1,351 (468) Decrease in cash and cash equivalents $ (63,888) $ (8,223) Operating activities Net cash used in operating activities decreased from $44.0 million in the six months ended June 30, 2025 to $7.6 million in the six months ended June 30, 2026. The decrease in cash flows used in operations was primarily attributable to a $56.0 million upfront payment received to discover and develop next-generation TCE multispecific antibodies, the full receipt of a $36.0 million litigation settlement that was receivable at December 31, 2025, and working capital movements, partially offset by upfront payments received in Q1 2025 that did not recur in the current period. Investing activities Net cash used by investing activities decreased from $23.9 million in the six months ended June 30, 2025 to $13.7 million in the six months ended June 30, 2026. The decrease in cashflows used by investing activities was primarily attributable to a $36.2 million reduction in purchases of property and equipment and other long-term assets, partially offset by a $26.5 million reduction in net proceeds from marketable securities as cash was used to purchase additional marketable securities in the current period. Financing activities Net cash provided by financing activities increased from $2.6 million in the six months ended June 30, 2025 to $13.6 million in the six months ended June 30, 2026. The increase was primarily attributable to proceeds from government contributions and other long-term liabilities. Critical Accounting Policies and Significant Judgements and Estimates Detailed information about our critical accounting policies and estimates is set forth in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2025. There have been no significant changes to these policies since then.