INSMED Inc 10-Q for FY2026 Q1
INSMED Inc (INSM)
10-Q
2026-05-07
For: 2026-03-31
View Original
Added on
May 07, 2026
About this 10-Q
INSMED Inc filed this 10-Q on May 7, 2026, covering the quarter ended March 31, 2026 (FY2026 Q1).
Headline figures
Quarter ended March 31, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $305.96M
- up 229.6% from $92.82M a year earlier
- Net loss
- $163.56M
- compared with a net loss of $256.58M a year earlier
- Diluted EPS
- -$0.76
- compared with -$1.42 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
For the quarterly period ended March 31, 2026
OR
For the transition period from to
Commission File Number 000-30739
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. employer identification no.) | |||||||
| (Address of principal executive offices) | (Zip Code) | |||||||
(908 ) 977-9900
(Registrant’s telephone number including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section12(b) of the Act:
| Title of each class | Trading symbols | Name of each exchange on which registered | ||||||
Indicate 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 x No ☐
Indicate 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 x No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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.
Accelerated filer o | ||||||||
Non-accelerated filer o | Smaller reporting company | |||||||
Emerging growth company | ||||||||
If 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. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x
As of May 1, 2026, there were 216,752,451 shares of the registrant’s common stock outstanding.
INSMED INCORPORATED
FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 2026
INDEX
Consolidated Balance Sheets as of March 31, 2026 (unaudited) and December 31, 2025 | ||||||||
Consolidated Statements of Comprehensive Loss (unaudited) for the three months ended March 31, 2026 and 2025 | ||||||||
Consolidated Statements of Shareholders' Equity (unaudited) for the three months ended March 31, 2026 and 2025 | ||||||||
Consolidated Statements of Cash Flows (unaudited) for the three months ended March 31, 2026 and 2025 | ||||||||
Unless the context otherwise indicates, references in this Form 10-Q to “Insmed Incorporated” refer to Insmed Incorporated, a Virginia corporation, and the “Company,” “Insmed,” “we,” “us” and “our” refer to Insmed Incorporated together with its consolidated subsidiaries. INSMED, PULMOVANCE, ARIKAYCE, and BRINSUPRI are trademarks of Insmed Incorporated. This Form 10-Q also contains trademarks of third parties. Each trademark of another company appearing in this Form 10-Q is the property of its owner.
2
PART I. FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
INSMED INCORPORATED
Consolidated Balance Sheets
(in thousands, except par value and share data)
| As of | As of | ||||||||||
| March 31, 2026 | December 31, 2025 | ||||||||||
| (unaudited) | |||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Marketable securities | |||||||||||
| Accounts receivable | |||||||||||
| Inventory | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
| Fixed assets, net | |||||||||||
| Finance lease right-of-use assets | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Intangibles, net | |||||||||||
| Goodwill | |||||||||||
| Other assets | |||||||||||
| Total assets | $ | $ | |||||||||
| Liabilities and shareholders’ equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable and accrued liabilities | $ | $ | |||||||||
| Finance lease liabilities | |||||||||||
| Operating lease liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Debt, long-term | |||||||||||
| Royalty financing agreement | |||||||||||
| Contingent consideration | |||||||||||
| Finance lease liabilities, long-term | |||||||||||
| Operating lease liabilities, long-term | |||||||||||
| Other long-term liabilities | |||||||||||
| Total liabilities | |||||||||||
| Shareholders’ equity: | |||||||||||
Common stock, $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Accumulated deficit | ( | ( | |||||||||
| Accumulated other comprehensive gain | |||||||||||
| Total shareholders’ equity | |||||||||||
| Total liabilities and shareholders’ equity | $ | $ | |||||||||
See accompanying notes to the unaudited consolidated financial statements
3
INSMED INCORPORATED
Consolidated Statements of Comprehensive Loss (unaudited)
(in thousands, except per share data)
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| $ | $ | ||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Research and development | |||||||||||||||||||||||
| Selling, general and administrative | |||||||||||||||||||||||
| Amortization of intangible assets | |||||||||||||||||||||||
| Change in fair value of contingent consideration | ( | ||||||||||||||||||||||
| Total operating expenses | |||||||||||||||||||||||
| Operating loss | ( | ( | |||||||||||||||||||||
| Investment income | |||||||||||||||||||||||
| Interest expense | ( | ( | |||||||||||||||||||||
| Other (expense) income, net | ( | ||||||||||||||||||||||
| Loss before income taxes | ( | ( | |||||||||||||||||||||
| Provision for income taxes | |||||||||||||||||||||||
| Net loss | $ | ( | $ | ( | |||||||||||||||||||
| Basic and diluted net loss per share | $ | ( | $ | ( | |||||||||||||||||||
Weighted average basic and diluted common shares outstanding | |||||||||||||||||||||||
| Net loss | $ | ( | $ | ( | |||||||||||||||||||
| Other comprehensive income (loss): | |||||||||||||||||||||||
| Foreign currency translation (losses) gains | ( | ||||||||||||||||||||||
| Unrealized loss on marketable securities | ( | ( | |||||||||||||||||||||
| Total comprehensive loss | $ | ( | $ | ( | |||||||||||||||||||
See accompanying notes to the unaudited consolidated financial statements
4
INSMED INCORPORATED
Consolidated Statements of Shareholders' Equity (unaudited)
(in thousands)
| Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Comprehensive loss: | |||||||||||||||||||||||||||||||||||
| Net loss | ( | ( | |||||||||||||||||||||||||||||||||
| Other comprehensive income | |||||||||||||||||||||||||||||||||||
| Issuance of common stock for exercise of stock options, vesting of RSUs and PSUs, and ESPP | |||||||||||||||||||||||||||||||||||
| Issuance of common stock upon conversion of convertible notes | |||||||||||||||||||||||||||||||||||
| Stock-based compensation expense | |||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||
| Comprehensive loss: | |||||||||||||||||||||||||||||||||||
| Net loss | ( | ( | |||||||||||||||||||||||||||||||||
| Other comprehensive loss | ( | ( | |||||||||||||||||||||||||||||||||
| Issuance of common stock for exercise of stock options, vesting of RSUs, and ESPP | |||||||||||||||||||||||||||||||||||
| Contingent payments for Business Acquisition | |||||||||||||||||||||||||||||||||||
| Stock-based compensation expense | |||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||
See accompanying notes to the unaudited consolidated financial statements
5
INSMED INCORPORATED
Consolidated Statements of Cash Flows (unaudited)
(in thousands)
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Operating activities | |||||||||||
| Net loss | $ | ( | $ | ( | |||||||
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||||
| Depreciation | |||||||||||
| Amortization of intangible assets | |||||||||||
| Stock-based compensation expense | |||||||||||
| Amortization of debt issuance costs | |||||||||||
| Royalty financing non-cash interest expense | |||||||||||
| Accretion of discount on marketable securities, net | ( | ( | |||||||||
| Finance lease amortization expense | |||||||||||
| Non-cash operating lease expense | |||||||||||
| Change in fair value of contingent consideration | ( | ||||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable | ( | ||||||||||
| Inventory | ( | ( | |||||||||
| Prepaid expenses and other current assets | ( | ||||||||||
| Other assets | ( | ||||||||||
| Accounts payable and accrued liabilities | ( | ( | |||||||||
| Other liabilities | ( | ( | |||||||||
| Net cash used in operating activities | ( | ( | |||||||||
| Investing activities | |||||||||||
| Purchase of fixed assets | ( | ( | |||||||||
| Payment of AZ milestone | ( | ||||||||||
| Purchase of marketable securities | ( | ||||||||||
| Maturities of marketable securities | |||||||||||
| Net cash provided by investing activities | |||||||||||
| Financing activities | |||||||||||
| Proceeds from exercise of stock options and ESPP | |||||||||||
| Payments of finance lease principal | ( | ( | |||||||||
| Net cash provided by financing activities | |||||||||||
| Effect of exchange rates on cash and cash equivalents | ( | ||||||||||
| Net increase (decrease) in cash and cash equivalents | ( | ||||||||||
| Cash and cash equivalents at beginning of period | |||||||||||
| Cash and cash equivalents at end of period | $ | $ | |||||||||
| Supplemental disclosures of cash flow information: | |||||||||||
| Cash paid for interest | $ | $ | |||||||||
| Cash paid for income taxes | $ | $ | |||||||||
See accompanying notes to the unaudited consolidated financial statements
6
1. The Company and Basis of Presentation
Insmed is a people-first global biopharmaceutical company striving to deliver first- and best-in-class therapies to transform the lives of patients facing serious diseases. The Company's commercial portfolio and clinical pipeline are organized around three therapeutic areas: Respiratory, Immunology & Inflammation, and Neuro & Other Rare. To complement the Company's internal research and development, the Company also actively evaluates in-licensing and acquisition opportunities for commercial products, product candidates, and technologies.
The Company's first two commercial products, ARIKAYCE® and BRINSUPRI®, are both part of the Respiratory therapeutic area. ARIKAYCE is approved in the United States (US) as ARIKAYCE (amikacin liposome inhalation suspension), in Europe as ARIKAYCE Liposomal 590 mg Nebuliser Dispersion and in Japan as ARIKAYCE inhalation 590 mg (amikacin sulfate inhalation drug product). ARIKAYCE received accelerated approval in the US in September 2018 for the treatment of Mycobacterium avium complex (MAC) lung disease as part of a combination antibacterial drug regimen for adult patients with limited or no alternative treatment options in a refractory setting. In October 2020, the European Commission (EC) approved ARIKAYCE Liposomal for the treatment of nontuberculous mycobacterial (NTM) lung infections caused by MAC in adults with limited treatment options who do not have cystic fibrosis (CF). In March 2021, Japan's Ministry of Health, Labour and Welfare (MHLW) approved ARIKAYCE for the treatment of patients with NTM lung disease caused by MAC who did not sufficiently respond to prior treatment with a multidrug regimen. NTM lung disease caused by MAC (which the Company refers to as MAC lung disease) is a rare and often chronic infection that can cause irreversible lung damage and can be fatal.
BRINSUPRI (brensocatib 25 mg and 10 mg tablets), an oral, once-daily treatment for non-cystic fibrosis bronchiectasis (referred to as bronchiectasis or NCFB) in patients 12 years of age and older, was approved in the US in August 2025. In November 2025, the EC approved BRINSUPRI (brensocatib 25 mg tablets) for the treatment of NCFB in patients 12 years of age and older with two or more exacerbations in the prior 12 months. In February 2026, the United Kingdom's (UK) Medicines and Healthcare products Regulatory Agency (MHRA) approved BRINSUPRI (brensocatib 25 mg tablets) for the treatment of NCFB in patients 12 years of age and older with two or more flare-ups or worsening of symptoms in the past 12 months. Bronchiectasis is a serious, chronic lung disease in which the bronchi become permanently dilated due to a cycle of infection, inflammation, and lung tissue damage.
The Company's Respiratory therapeutic area also includes clinical-stage programs for treprostinil palmitil inhalation powder (TPIP) and INS1148. TPIP is an inhaled dry powder formulation of the treprostinil prodrug treprostinil palmitil which may offer a differentiated product profile for pulmonary hypertension associated with interstitial lung disease (PH-ILD), pulmonary arterial hypertension (PAH), progressive pulmonary fibrosis (PPF), and idiopathic pulmonary fibrosis (IPF). INS1148 is a monoclonal antibody targeting a specific isoform of Stem Cell Factor, called Stem Cell Factor 248 (SCF248), which we plan to initially develop for PPF and IPF. The Company is also exploring additional opportunities utilizing its various technologies within the Respiratory therapeutic area.
The Company's Immunology & Inflammation therapeutic area is exploring opportunities utilizing its various technologies.
The Company's Neuro & Other Rare therapeutic area includes the clinical-stage programs INS1201, an intrathecally delivered gene therapy for patients with Duchenne muscular dystrophy (DMD), and INS1202, an intrathecally delivered gene therapy for patients with amyotrophic lateral sclerosis (ALS). The Company is also exploring additional opportunities utilizing its various technologies within the Neuro & Other Rare therapeutic area.
The Company's pre-clinical research programs encompass a wide range of technologies and modalities, including gene therapy, artificial intelligence (AI)-driven protein engineering, RNA end-joining, and synthetic rescue.
The Company was incorporated in the Commonwealth of Virginia on November 29, 1999 and its principal executive offices are located in Bridgewater, New Jersey. The Company has legal entities in the US, France, Germany, Ireland, Italy, the Netherlands, Switzerland, the UK, and Japan.
The accompanying unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations for reporting on Form 10-Q. Accordingly, certain information and disclosures required by accounting principles generally accepted in the US (GAAP) for complete consolidated financial statements are not included herein. The unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and
7
INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
1. The Company and Basis of Presentation (Continued)
notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2025. Any references in these notes to applicable accounting guidance are meant to refer to GAAP as found in the Accounting Standards Codification (ASC) and Accounting Standards Updates (ASU) of the Financial Accounting Standards Board (FASB).
The results of operations of any interim period are not necessarily indicative of the results of operations for the full year. The unaudited interim consolidated financial information presented herein reflects all normal and recurring adjustments that are, in the opinion of management, necessary for a fair statement of the financial position, results of operations and cash flows for the periods presented. All intercompany transactions and balances have been eliminated in consolidation. Certain prior period line items within the consolidated statements of shareholders' equity have been combined to conform to the current period presentation.
The Company had $582.2 million of cash and cash equivalents and $641.3 million of marketable securities as of March 31, 2026 and reported a net loss of $163.6 million for the three months ended March 31, 2026. The Company has funded its operations through public offerings of equity securities, debt financings, revenue interest financings, and revenues generated from ARIKAYCE and BRINSUPRI. The Company expects to continue to incur consolidated operating losses, including losses in its US and certain international entities, while funding research and development (R&D) activities for ARIKAYCE, TPIP, INS1148, INS1201, INS1202, and its other pipeline programs, and commercialization and regulatory activities for BRINSUPRI and ARIKAYCE.
The Company expects its future cash requirements to be substantial. While the Company currently has sufficient funds to meet its financial needs for at least the next 12 months, the Company may raise additional capital in the future to fund its operations, its ongoing commercialization and clinical trial activities, and its future product candidates, and to develop, acquire, in-license, or co-promote other products or product candidates, including those that address serious diseases with significant unmet need. The source, timing, and availability of any future financing or other transaction will depend principally upon continued progress in the Company’s commercial, regulatory, and development activities. Any future financing will also be contingent upon market conditions. If the Company is unable to obtain sufficient additional funds when required, the Company may be forced to delay, restrict, or eliminate all or a portion of its development programs or commercialization efforts.
2. Summary of Significant Accounting Policies
The Company’s complete listing of significant accounting policies is set forth in Note 2 of the notes to the consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2025. Selected significant accounting policies are discussed in detail below.
Use of Estimates—The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The Company bases its estimates and judgments on historical experience and on various other assumptions. The amounts of assets and liabilities reported in the Company's balance sheets and the amounts of revenues and expenses reported for each period presented are affected by estimates and assumptions, which are used for, but not limited to, the accounting for revenue allowances, stock-based compensation, income taxes, loss contingencies, acquisition related intangibles including in process research and development (IPR&D) and goodwill, fair value of contingent consideration, the revenue interest purchase agreement (the Royalty Financing Agreement), and accounting for R&D costs. Actual results could differ from those estimates.
Concentration of Credit Risk—Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and marketable securities. The Company places its cash equivalents and marketable securities with high credit-quality financial institutions and may invest its investments in US treasury securities, mutual funds, and government agency bonds. The Company has established guidelines relative to credit ratings and maturities that seek to maintain safety and liquidity.
The Company is exposed to risks associated with extending credit to customers related to the sale of products. The Company does not require collateral to secure amounts due from its customers. The Company uses an expected loss methodology to calculate allowances for trade receivables. The Company's measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable
8
INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. Summary of Significant Accounting Policies (Continued)
forecasts that affect the collectability of the reported amount. The Company does not currently have a material allowance for uncollectible trade receivables.
The following table presents the customers representing 10% or more of the Company's gross product revenues for the three months ended March 31, 2026 and their respective percentages for the three months ended March 31, 2025.
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Customer A | |||||||||||||||||||||||
| Customer B | |||||||||||||||||||||||
| Customer C | |||||||||||||||||||||||
| Customer D | |||||||||||||||||||||||
The Company relies on third-party manufacturers and suppliers for manufacturing and supply of its products. The inability of the suppliers or manufacturers to fulfill supply requirements of the Company could materially impact future operating results. A change in the relationship with the suppliers or manufacturers, or an adverse change in their business, could materially impact future operating results.
Net Loss Per Share—Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of common shares and other dilutive securities outstanding during the period. Potentially dilutive securities from stock options, restricted stock units (RSUs), performance stock units (PSUs) and formerly outstanding convertible debt securities would be anti-dilutive as the Company incurred a net loss. Potentially dilutive common shares resulting from the assumed exercise of outstanding stock options and from the assumed conversion of the Company's previously outstanding convertible notes are determined based on the treasury stock method.
The following table sets forth the reconciliation of the weighted average number of common shares used to compute basic and diluted net loss per share for the three months ended March 31, 2026 and 2025 (in thousands, except per share amounts):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||
| Net loss | $ | ( | $ | ( | |||||||||||||||||||
| Denominator: | |||||||||||||||||||||||
| Weighted average common shares used in calculation of basic net loss per share: | |||||||||||||||||||||||
| Effect of dilutive securities: | |||||||||||||||||||||||
| Common stock options | |||||||||||||||||||||||
| RSUs | |||||||||||||||||||||||
| PSUs | |||||||||||||||||||||||
| Convertible debt securities | |||||||||||||||||||||||
| Weighted average common shares outstanding used in calculation of diluted net loss per share | |||||||||||||||||||||||
| Net loss per share: | |||||||||||||||||||||||
| Basic and diluted | $ | ( | $ | ( | |||||||||||||||||||
9
INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. Summary of Significant Accounting Policies (Continued)
The following potentially dilutive securities have been excluded from the computations of diluted weighted average common shares outstanding as of March 31, 2026 and 2025, as their effect would have been anti-dilutive (in thousands):
As of March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Common stock options | |||||||||||
| RSUs | |||||||||||
| PSUs | |||||||||||
| Convertible debt securities | |||||||||||
Recently Adopted Accounting Pronouncements—In July 2025, the FASB issued ASU 2025-05, Financial Instruments-Credit Losses (Topic 326)—Measurement of Credit Losses for Accounts Receivable and Contract Assets. The amendments provide an optional practical expedient for estimated expected credit losses on current accounts receivable and current contract assets arising from ASC 606 revenue transactions, allowing entities to assume that economic conditions at the balance sheet date will remain unchanged over the remaining life of the receivable. The amendments are effective for annual periods beginning after December 15, 2025. The Company adopted the standard effective January 1, 2026 using the prospective transition method. The adoption of ASU 2025-05 did not have a material impact on the Company's consolidated financial statements.
In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606)—Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract. The amendments clarify the scope of derivative accounting and the application of the revenue recognition guidance to share-based noncash consideration received from customers. The Company adopted the standard effective January 1, 2026, using the prospective transition method. The adoption of ASU 2025-07 did not have a material impact on the Company’s consolidated financial statements.
Recent Accounting Pronouncements (Not Yet Adopted)—In November 2024, the FASB issued ASU 2024-03, Income Statement (Subtopic 220-40)—Expense Disaggregation Disclosures, which requires disclosure of disaggregated income statement expense information about specific categories (including purchases of inventory, employee compensation, depreciation, and intangible asset amortization) in the notes to financial statements. ASU 2024-03 will be effective for fiscal years beginning after December 15, 2026 and interim periods beginning after December 15, 2027. The guidance is applied on a prospective basis, with a retrospective option, and early adoption is permitted. The Company is currently evaluating the impact of adoption of ASU 2024-03 on its consolidated financial statements.
3. Fair Value Measurements
The Company categorizes its financial assets and liabilities measured and reported at fair value in the financial statements on a recurring basis based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels, which are directly related to the amount of subjectivity associated with the inputs used to determine the fair value of financial assets and liabilities, are as follows:
•Level 1—Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.
•Level 2—Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the assets or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life.
•Level 3—Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.
Each major category of financial assets and liabilities measured at fair value on a recurring basis is categorized based upon the lowest level of significant input to the valuations. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Financial instruments in Level 1 generally include US treasuries and mutual funds listed in active markets. The Company's cash and cash equivalents permit daily redemption and the fair values of these investments are based upon the quoted prices in active markets provided by the holding financial institutions.
10
INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
3. Fair Value Measurements (Continued)
The following table shows assets and liabilities that are measured at fair value on a recurring basis and their carrying value (in millions):
As of March 31, 2026 | |||||||||||||||||||||||
| Fair Value | |||||||||||||||||||||||
| Carrying Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||
| Assets | |||||||||||||||||||||||
| Cash and cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
| Marketable securities | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities | |||||||||||||||||||||||
| Contingent consideration | $ | $ | $ | $ | |||||||||||||||||||
As of December 31, 2025 | |||||||||||||||||||||||
| Fair Value | |||||||||||||||||||||||
| Carrying Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||
| Assets | |||||||||||||||||||||||
| Cash and cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
| Marketable securities | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities | |||||||||||||||||||||||
| Contingent consideration | $ | $ | $ | $ | |||||||||||||||||||
During the three months ended March 31, 2026, there were no purchases of marketable securities and $284.0 million of marketable securities, consisting of US Treasury Bills, matured.
As of March 31, 2026, the Company held $641.3 million of available-for-sale securities. Marketable securities maturing in one year or less are classified as current assets and marketable securities maturing in more than one year are classified as non-current assets.
The Company recognizes transfers between levels within the fair value hierarchy, if any, at the end of each quarter. There were no transfers in or out of Level 1, Level 2, or Level 3 during the three months ended March 31, 2026. During the three months ended March 31, 2026, no new Level 1 assets were added.
The Company reviews the status of each security quarterly to determine whether an other-than-temporary impairment has occurred. In making its determination, the Company considers a number of factors, including: (1) the significance of the decline; (2) whether the security was rated below investment grade; (3) failure of the issuer to make scheduled interest or principal payments; and (4) the Company's ability and intent to retain the investment for a sufficient period of time for it to recover. The Company has determined that there were no other-than-temporary impairments during the three months ended March 31, 2026.
Contingent Consideration
The contingent consideration liabilities arose from the acquisition of Motus Biosciences, Inc. and AlgaeneX, Inc. in August 2021 (together, the Business Acquisition). The contingent consideration liabilities consist of developmental and regulatory milestones, a priority review voucher (PRV) milestone, and net sales milestones. As of March 31, 2026, the Company was obligated to issue to Motus equityholders up to 4,610,838 shares of the Company's common stock in the aggregate and AlgaeneX equityholders up to 368,867 shares of the Company's common stock in the aggregate upon the achievement of certain development and regulatory milestone events. The fair value of the development and regulatory milestones are estimated utilizing a probability-adjusted approach. The weighted average probability of success of the remaining development and regulatory milestones was 31 % as of March 31, 2026. The development and regulatory milestones, if achieved, will be settled in shares of the Company's common stock. As such, there is no discount rate applied in the fair value calculation. During the third quarter of 2025 and first quarter of 2026, development milestones in connection with the Motus acquisition were achieved, resulting in the issuance of 364,566 shares of the Company's common stock in October 2025 and 364,397 shares of the Company's common stock in March 2026, respectively.
11
INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
3. Fair Value Measurements (Continued)
If the Company were to receive a PRV, the Company would be obligated to pay to the Motus equityholders a portion of the value of the PRV, subject to certain reductions. The potential payout will be either 50 % of the after tax net proceeds received by the Company from a sale of the PRV or 50 % of the average of the sales prices for the last three publicly disclosed PRV sales, less certain adjustments. The fair value of the PRV milestone is estimated utilizing a probability-adjusted discounted cash flow approach. This obligation will be settled in cash. On December 20, 2024, the FDA's PRV program expired. As of December 31, 2025, the Company determined that the likelihood of receiving a PRV was remote and the related milestone had no fair value. On February 3, 2026, the PRV program was reauthorized. As of March 31, 2026, the Company determined that the value of the PRV milestone was $15.2 million.
The contingent consideration liabilities for net sales milestones were valued using an option pricing model with Monte Carlo simulation. As of March 31, 2026, the fair value of these net sales milestones were deemed immaterial to the overall fair value of the contingent consideration.
The contingent consideration liabilities have been classified as a Level 3 recurring liability as its valuation requires substantial judgment and estimation of factors that are not currently observable in the market. If different assumptions were used for the inputs to the valuation approach, the estimated fair value could be significantly different than the fair value the Company determined. Contingent consideration liabilities expected to be settled within twelve months are classified as a current liability within accounts payable and accrued liabilities. Contingent consideration liabilities expected to be settled in more than twelve months are classified as a non-current liability. As of March 31, 2026, there was no current contingent consideration outstanding, and the fair value of the non-current contingent consideration was $270.3 million.
A valuation of the contingent consideration liabilities is performed quarterly with gains and losses included within change in fair value of contingent consideration in the consolidated statements of comprehensive loss. The following significant unobservable inputs were used in the valuation of the contingent consideration liabilities as of March 31, 2026 and December 31, 2025:
Fair Value as of March 31, 2026 (in millions) | Valuation Technique | Unobservable Inputs | Values | |||||||||||
| Development and regulatory milestones | $ | Probability-adjusted | Probabilities of success | |||||||||||
| PRV milestone | $ | Probability-adjusted discounted cash flow | Probability of success | |||||||||||
| Discount rate | ||||||||||||||
Fair Value as of December 31, 2025 (in millions) | Valuation Technique | Unobservable Inputs | Values | |||||||||||
| Development and regulatory milestones | $ | Probability-adjusted | Probabilities of success | |||||||||||
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INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
3. Fair Value Measurements (Continued)
A rollforward of the Company's valuations for the contingent consideration liabilities for the three months ended March 31, 2026 and 2025 follows (in thousands):
| Contingent Consideration (Level 3 Liabilities) | |||||||||||
| Balance as of December 31, 2024 | $ | ||||||||||
| Additions | |||||||||||
| Change in fair value | |||||||||||
| Payments | |||||||||||
| Balance as of March 31, 2025 | $ | ||||||||||
| Balance as of December 31, 2025 | $ | ||||||||||
| Additions | |||||||||||
| Change in fair value | ( | ||||||||||
| Payments | ( | ||||||||||
| Balance as of March 31, 2026 | $ | ||||||||||
The change in fair value of contingent consideration liabilities is due to changes in factors such as the probability of achieving milestones, the Company's stock price, or certain other estimated assumptions. Payments were made in shares of the Company's common stock.
Royalty Financing Agreement
The fair value of the Royalty Financing Agreement at the time of the transaction was based on the Company’s estimates of future royalties expected to be paid to OrbiMed Royalty & Credit Opportunities IV, LP (OrbiMed) over the life of the arrangement, which was determined using forecasts from market data sources, which are considered Level 3 inputs. This liability is being amortized using the effective interest method over the life of the arrangement, in accordance with ASC 470, Debt and ASC 835, Interest. The Company will utilize the prospective method to account for subsequent changes in the estimated future payments to be made to OrbiMed and will update the effective interest rate on a quarterly basis. The carrying value of the Royalty Financing Agreement approximates fair value. See Note 11 - Royalty Financing Agreement for further details.
Secured Senior Term Loan
The carrying value of the Company's secured senior term loans are measured at amortized cost using the effective interest method and the carrying value approximates fair value. See Note 10 - Debt for further details.
4. Product Revenues, Net
In accordance with ASC 606, Revenue from Contracts with Customers, the Company recognizes revenue when a customer obtains control of promised goods or services, in an amount that reflects the consideration the Company expects to receive in exchange for the goods or services provided. To determine revenue recognition for arrangements within the scope of ASC 606, the Company performs the following five steps: (1) identify the contracts with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when or as the entity satisfies a performance obligation. At contract inception, the Company assesses the goods or services promised within each contract to determine which are performance obligations and to assess whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when or as the performance obligation is satisfied. For all contracts that fall into the scope of ASC 606, the Company has identified one performance obligation: the sale of its marketed products to its customers. The Company has not incurred or capitalized any incremental costs associated with obtaining contracts with customers.
Product revenues, net consist of global net sales of ARIKAYCE and net sales of BRINSUPRI. The Company's customers in the US include specialty pharmacies and a specialty distributor. Product revenues are recognized once the Company performs and satisfies all five steps of the revenue recognition criteria described above.
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INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
4. Product Revenues, Net (Continued)
The following tables present a geographic summary of the Company's product revenues, net, for the three months ended March 31, 2026 and 2025 (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| ARIKAYCE | |||||||||||||||||||||||
| US | $ | $ | |||||||||||||||||||||
| International | |||||||||||||||||||||||
| Total | $ | $ | |||||||||||||||||||||
| BRINSUPRI | |||||||||||||||||||||||
| US | $ | $ | |||||||||||||||||||||
| International | |||||||||||||||||||||||
| Total | $ | $ | |||||||||||||||||||||
| Total | |||||||||||||||||||||||
| US | $ | $ | |||||||||||||||||||||
| International | |||||||||||||||||||||||
| Total product revenues, net | $ | $ | |||||||||||||||||||||
The Company also recognizes revenue related to various managed access programs. The Company began recognizing international BRINSUPRI revenue related to early access programs (EAPs) in Europe, consisting of sales to the French National Agency for Medicines and Health Products Safety, which has granted BRINSUPRI a Compassionate Access Authorisation (Autorisation d'accès compassionnel or AAC) and sales through the named patient program (NPP) in other countries.
Revenue is recorded at net selling price (transaction price), which includes estimates of variable consideration for which reserves are established for (a) customer credits, such as invoice discounts for prompt pay, (b) estimated government rebates, such as Medicaid and Medicare Part D reimbursements, and estimated managed care rebates, (c) estimated chargebacks, and (d) estimated costs of co-payment assistance. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (prompt pay discounts and chargebacks), prepaid expenses (co-payment assistance), or as a current liability (rebates). Where appropriate, these estimates take into consideration a range of possible outcomes which are probability-weighted for relevant factors such as the Company's historical experience, current contractual and statutory requirements, and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company's best estimates of the amount of consideration to which it is entitled based on the terms of the applicable contract. The amount of variable consideration included in the transaction price may be constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company's estimates. If actual results in the future vary from estimates, the Company adjusts these estimates, which would affect net product revenue and earnings in the period such variances become known.
Customer credits: Certain of the Company's customers are offered various forms of consideration, including prompt payment discounts. The payment terms for sales to specialty pharmacies and specialty distributors for prompt payment discounts are based on contractual rates agreed with the respective specialty pharmacies and distributors. The Company anticipates that its customers will earn these discounts and, therefore, deducts the full amount of these discounts from total gross product revenues at the time such revenues are recognized.
Rebates: The Company contracts with certain government agencies and managed care organizations, or collectively, third-party payors, so that its marketed products will be eligible for purchase by, or partial or full reimbursement from, such third-party payors. The Company estimates the rebates it will provide to third-party payors and deducts these estimated amounts from total gross product revenues at the time the revenues are recognized. These reserves are recorded in the same period in which the revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability. The current liability is included in accounts payable and accrued liabilities on the consolidated balance sheets. The Company estimates the rebates that it will provide to third-party payors based upon (i) the Company's contracts with these third-party payors, (ii) the government mandated discounts applicable to government-funded programs, (iii) a range of possible outcomes
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INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
4. Product Revenues, Net (Continued)
that are probability-weighted for the estimated payor mix, and (iv) information obtained from the Company's specialty pharmacies.
Chargebacks: Chargebacks are discounts that occur when certain contracted customers, currently public health service institutions and federal government entities purchasing via the Federal Supply Schedule, purchase directly from the Company's specialty distributor. Contracted customers generally purchase the product at a discounted price and the specialty distributor, in turn, charges back to the Company the difference between the price the specialty distributor initially paid and the discounted price paid by the contracted customers. The Company estimates chargebacks provided to the specialty distributor and deducts these estimated amounts from gross product revenues, and from accounts receivable, at the time revenues are recognized.
Co-payment assistance: Patients who have commercial insurance and meet certain eligibility requirements may receive co-payment assistance. Based upon the terms of the program and information regarding programs provided for similar specialty pharmaceutical products, the Company estimates the average co-pay mitigation amounts and the percentage of patients that it expects to participate in the program in order to establish accruals for co-payment assistance. These reserves are recorded in the same period in which the related revenue is recognized, resulting in a reduction of product revenue. The Company adjusts its accruals for co-pay assistance based on actual redemption activity and estimates of future redemptions related to sales in the current period.
If any, or all, of the Company's actual experience varies from its estimates, the Company may need to adjust prior period accruals, affecting revenue in the period of adjustment.
5. Inventory
The Company's inventory balance consists of the following (in thousands):
| As of | |||||||||||
| March 31, 2026 | December 31, 2025 | ||||||||||
| Raw materials | $ | $ | |||||||||
| Work-in-process | |||||||||||
| Finished goods | |||||||||||
| $ | $ | ||||||||||
Inventory is stated at the lower of cost and net realizable value and consists of raw materials, work-in-process and finished goods. The Company has not recorded any significant inventory write-downs. The Company currently uses a limited number of third-party contract manufacturing organizations (CMOs) to produce its inventory.
6. Intangibles, Net and Goodwill
Intangibles, Net
Finite-lived Intangible Assets
As of March 31, 2026, the Company's finite-lived intangible assets consisted of acquired ARIKAYCE R&D, the milestones paid to PARI Pharma GmbH (PARI) for the license to use the Lamira® Nebulizer System (Lamira) for the delivery of ARIKAYCE to patients as a result of the FDA and EC approvals of ARIKAYCE in September 2018 and October 2020, respectively, the milestone paid to AstraZeneca AB (AstraZeneca) as a result of the FDA approval of BRINSUPRI in August 2025, and the milestone paid to AstraZeneca as a result of the EC approval of BRINSUPRI in November 2025. The Company began amortizing its acquired ARIKAYCE R&D and PARI milestone-related intangible assets in October 2018, over ARIKAYCE's initial regulatory exclusivity period of 12 years, and began amortizing its AstraZeneca milestone-related intangible assets in August and November 2025 over BRINSUPRI's regulatory exclusivity period of approximately 14 years. Amortization expense is estimated to be $8.3 7.1 million for 2030.
Indefinite-lived Intangible Assets
As of March 31, 2026, the Company's indefinite-lived intangible assets consisted of acquired IPR&D from the Business Acquisition. Indefinite-lived intangible assets are not amortized.
15
INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
6. Intangibles, Net and Goodwill (Continued)
A rollforward of the Company's intangible assets for the three months ended March 31, 2026 and 2025 is as follows (in thousands):
| Intangible Asset | December 31, 2025 | Additions | Amortization | March 31, 2026 | ||||||||||||||||||||||
| Acquired ARIKAYCE R&D | $ | $ | $ | ( | $ | |||||||||||||||||||||
| PARI milestones | ( | |||||||||||||||||||||||||
| AstraZeneca milestone | ( | |||||||||||||||||||||||||
| Acquired IPR&D | ||||||||||||||||||||||||||
| $ | $ | $ | ( | $ | ||||||||||||||||||||||
| Intangible Asset | December 31, 2024 | Additions | Amortization | March 31, 2025 | ||||||||||||||||||||||
| Acquired ARIKAYCE R&D | $ | $ | $ | ( | $ | |||||||||||||||||||||
| PARI milestones | ( | |||||||||||||||||||||||||
| Acquired IPR&D | ||||||||||||||||||||||||||
| $ | $ | $ | ( | $ | ||||||||||||||||||||||
Goodwill
7. Fixed Assets, Net
Fixed assets are stated at cost and depreciated using the straight-line method, based on useful lives as follows (in thousands):
| Estimated Useful Life (years) | As of | |||||||||||||||||||
| Asset Description | March 31, 2026 | December 31, 2025 | ||||||||||||||||||
| Building | $ | $ | ||||||||||||||||||
| Land | NA | |||||||||||||||||||
| Lab equipment | ||||||||||||||||||||
| Furniture and fixtures | ||||||||||||||||||||
| Computer hardware and software | ||||||||||||||||||||
| Office equipment | ||||||||||||||||||||
| Manufacturing equipment | ||||||||||||||||||||
| Leasehold improvements | ||||||||||||||||||||
| Construction in progress | — | |||||||||||||||||||
| Less: accumulated depreciation | ( | ( | ||||||||||||||||||
| $ | $ | |||||||||||||||||||
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INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
8. Accounts Payable and Accrued Liabilities
Accounts payable and accrued liabilities consist of the following (in thousands):
| As of | |||||||||||
| March 31, 2026 | December 31, 2025 | ||||||||||
| Accounts payable and other accrued operating expenses | $ | $ | |||||||||
| Accrued clinical trial expenses | |||||||||||
| Accrued professional fees | |||||||||||
| Accrued technical operation expenses | |||||||||||
| Accrued compensation and employee related costs | |||||||||||
| Accrued royalty and milestones payable | |||||||||||
| Revenue Interest Payments payable | |||||||||||
| Accrued sales allowances and related costs | |||||||||||
| Accrued French rebate payable | |||||||||||
| Contingent consideration | |||||||||||
| Accrued milestone payment to AstraZeneca | |||||||||||
| Other accrued liabilities | |||||||||||
| $ | $ | ||||||||||
9. Leases
The Company's lease portfolio consists primarily of office and laboratory space, manufacturing facilities, research equipment and fleet vehicles. All of the Company's leases are classified as operating leases, except for the Company's leases of its corporate headquarters and a research facility in San Diego, which are classified as finance leases. The terms of the Company's lease agreements that have commenced range from less than one year to ten years, ten months . In its assessment of the term of each such lease, the Company has not included any options to extend or terminate the lease due to the absence of economic incentives in its lease agreements. Leases that qualify for treatment as a short-term lease are expensed as incurred. These short-term leases are not material to the Company's financial position. Furthermore, the Company does not separate lease and non-lease components for all classes of underlying assets. The Company's leases do not contain residual value guarantees and it does not sublease any of its leased assets.
The Company outsources its manufacturing operations to CMOs. Upon review of the agreements with its CMOs, the Company determined that these contracts contain embedded leases for dedicated manufacturing facilities. The Company obtains substantially all of the economic benefits from the use of the manufacturing facilities, the Company has the right to direct how and for what purpose the facility is used throughout the period of use, and the supplier does not have the right to change the operating instructions of the facility. The operating lease right-of-use assets and corresponding lease liabilities associated with the manufacturing facilities is the sum of the minimum guarantees over the life of the production contracts.
The Company records variable consideration for variable lease payments in excess of fixed fees or minimum guarantees. Variable consideration related to the Company's leasing arrangements was $7.6 million and $2.5 million for the three months ended March 31, 2026 and 2025, respectively. Variable costs related to CMO manufacturing agreements are direct costs related to the manufacturing of ARIKAYCE and are capitalized within inventory in the Company's consolidated balance sheet, while the variable costs related to other leasing arrangements, not related to the manufacturing of ARIKAYCE, have been classified within operating expenses in the Company's consolidated statements of comprehensive loss.
During the three months ended March 31, 2026 and 2025, the Company did not acquire any new right-of-use assets in exchange for lease obligations.
17
INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
9. Leases (Continued)
In addition to the Company's lease agreements that have previously commenced and are reflected in the consolidated financial statements, the Company has entered into additional lease agreements that have not yet commenced. The Company entered into certain agreements with Patheon UK Limited (Patheon) related to increasing its long-term production capacity for ARIKAYCE commercial inventory. The Company has determined that these agreements with Patheon contain an embedded lease for the manufacturing facility and the specialized equipment contained therein. As of March 31, 2026 and December 31, 2025, costs of $72.5 million and $69.5 million, respectively, incurred by the Company under these additional agreements have been classified within other assets in the Company's consolidated balance sheet. Upon the commencement date, prepaid costs and minimum guarantees specified in the agreement will be combined to establish an operating lease ROU asset and operating lease liability.
10. Debt
Amended and Restated Loan Agreement
In October 2022, the Company entered into the $350.0 million loan agreement (the Loan Agreement) with Pharmakon Advisors LP (Pharmakon) that would have matured on October 19, 2027 (the Tranche A Term Loan). The Tranche A Term Loan originally bore interest at a rate based upon the Secured Overnight Financing Rate (SOFR), subject to a SOFR floor of 2.5 %, in addition to a margin of 7.75 % per annum. Up to 50 % of the interest payable during the first 24 months from the closing of the Tranche A Term Loan could have been paid-in-kind at the Company's election. If elected, paid-in-kind interest would have been capitalized and added to the principal amount of the Tranche A Term Loan. The Tranche A Term Loan, including the paid-in-kind interest, would have been repaid in eight equal quarterly payments starting in the 13th quarter following the closing of the Tranche A Term Loan (i.e., the quarter ending March 31, 2026), except that the repayment start date could have been extended at the Company's option for an additional four quarters, so that repayments start in the 17th quarter following the closing of the Tranche A Term Loan, subject to the achievement of specified ARIKAYCE data thresholds and certain other conditions. Net proceeds from the Tranche A Term Loan, after deducting the lenders fees and deal expenses of $15.1 million, were $334.9 million.
In October 2024, the Company entered into an Amended and Restated Loan Agreement, as amended on July 10, 2025, (the A&R Loan Agreement) with BioPharma Credit PLC, BPCR Limited Partnership and BioPharma Credit Investments V (Master) LP, which are funds managed by Pharmakon, and the guarantors party to such agreement. The A&R Loan Agreement amended and restated the Loan Agreement, dated as of October 19, 2022, pursuant to which the Tranche A Term Loan was provided. The A&R Loan Agreement, among other items, provides an additional $150.0 million senior secured term loan tranche (the Tranche B Term Loan and, together with the Tranche A Term Loan, the Term Loans). The A&R Loan Agreement extends the maturity of the Term Loans to September 30, 2029, subject to acceleration to February 1, 2028 on the occurrence of certain prespecified events, and amends the interest rate on the Term Loans to a fixed rate of 9.6 % per annum. As consideration for the provision of the Tranche B Term Loan, the Company agreed to pay Pharmakon a fee equal to 2.0 % of the Tranche B Term Loan at the closing date of the Tranche B Term Loan and an additional exit fee of 2.0 % of the amount of each prepayment or repayment of the Term Loans. The Term Loans will be repaid in eight equal quarterly payments starting on January 3, 2028. Net proceeds from the Tranche B Term Loan, after deducting the lenders fees and administrative expenses of $3.7 million, were $146.3 million.
The following table presents the carrying value of the Company’s Term Loans balance as of March 31, 2026 and December 31, 2025 (in thousands):
| As of | ||||||||||||||||||||
| March 31, 2026 | December 31, 2025 | |||||||||||||||||||
| Principal | $ | $ | ||||||||||||||||||
| Paid-in-kind interest capitalized | ||||||||||||||||||||
| Debt discount, net | ( | ( | ||||||||||||||||||
| Term Loans | $ | $ | ||||||||||||||||||
18
INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
10. Debt (Continued)
As of March 31, 2026, future principal repayments of debt for each of the fiscal years through maturity were as follows (in thousands):
| Year Ending December 31: | |||||
| 2026 | $ | ||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| 2030 | |||||
| 2031 and thereafter | |||||
| $ | |||||
Interest Expense
Interest expense for the three months ended March 31, 2026 and 2025 was as follows (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Convertible debt contractual interest expense | $ | $ | |||||||||||||||||||||
| Term Loans contractual interest expense | |||||||||||||||||||||||
| Royalty Financing Agreement interest expense | |||||||||||||||||||||||
| Amortization of debt issuance costs | |||||||||||||||||||||||
| Total debt interest expense | |||||||||||||||||||||||
| Finance lease interest expense | |||||||||||||||||||||||
| Total interest expense | $ | $ | |||||||||||||||||||||
11. Royalty Financing Agreement
In October 2022, the Company entered into the Royalty Financing Agreement with OrbiMed. Under the Royalty Financing Agreement, OrbiMed paid the Company $150.0 million in exchange for the right to receive, on a quarterly basis, royalties in an amount equal to 4.0 % of ARIKAYCE global net sales prior to September 1, 2025 and 4.5 % of ARIKAYCE global net sales on or after September 1, 2025, as well as 0.75 % of brensocatib global net sales, which includes BRINSUPRI. In the event that OrbiMed has not received aggregate Revenue Interest Payments of at least $150.0 million on or prior to March 31, 2028, the Company must make a one-time payment to OrbiMed for the difference between the $150.0 million and the aggregated Revenue Interest Payments that have been paid. In addition, the royalty rate for ARIKAYCE will be increased beginning March 31, 2028 to the rate which would have resulted in aggregate Revenue Interest Payments as of March 31, 2028 equaling $150.0 million. The total Revenue Interest Payments payable by the Company to OrbiMed are capped at 1.8 x of the purchase price or up to a maximum of 1.9 x of the purchase price under certain conditions. Net proceeds from the Royalty Financing Agreement, after deducting the lenders fees and deal expenses of $3.8 million, were $146.2 million. The Royalty Financing Agreement was amended in October 2024 to, among other things, amend certain restrictions on the Company’s ability to incur indebtedness.
The fair value of the Royalty Financing Agreement at the time of the transaction was based on the Company’s estimates of future royalties expected to be paid to OrbiMed over the life of the arrangement, which was determined using forecasts from market data sources, which are considered Level 3 inputs. This liability is being amortized using the effective interest method over the life of the arrangement, in accordance with ASC 470, Debt and ASC 835, Interest. The initial annual effective interest rate was determined to be 12.4 %. The Company is utilizing the prospective method to account for subsequent changes in the estimated future payments to be made to OrbiMed and updates the effective interest rate on a quarterly basis.
19
INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
11. Royalty Financing Agreement (Continued)
The following table presents the activity of the Company's Royalty Financing Agreement balance for the three-month period ended March 31, 2026 and year ended December 31, 2025 (in thousands):
| Three Months Ended March 31, 2026 | Twelve Months Ended December 31, 2025 | |||||||||||||
| Royalty Financing Agreement liability - beginning balance | $ | $ | ||||||||||||
| Revenue Interest Payments paid and payable | ( | ( | ||||||||||||
| Interest expense recognized | ||||||||||||||
| Royalty Financing Agreement liability - ending balance | $ | $ | ||||||||||||
| Royalty issuance costs, unamortized - beginning balance | $ | ( | $ | ( | ||||||||||
| Amortization of issuance costs | ||||||||||||||
| Royalty issuance costs, unamortized - ending balance | $ | ( | $ | ( | ||||||||||
| Royalty Financing Agreement | $ | $ | ||||||||||||
The Revenue Interest Payments payable in connection with the Royalty Financing Agreement were $6.0 million and $6.4 million as of March 31, 2026 and December 31, 2025, respectively, which were recorded within accounts payable and accrued expenses on the consolidated balance sheet. Non-cash interest expense is recorded within interest expense in the consolidated statements of comprehensive loss.
12. Shareholders' Equity
Common Stock—As of March 31, 2026, the Company had 500,000,000 shares of common stock authorized with a par value of $0.01 per share and 216,521,841 16,530,357 shares of common stock for issuance upon the exercise of outstanding stock options, and 4,067,262 shares of common stock for issuance upon the vesting of RSUs and 267,435 shares for issuance upon the vesting of PSUs. In connection with the Business Acquisition, the Company reserved 9,406,112 shares of the Company’s common stock, subject to certain closing-related reductions.
Of the 9,406,112 shares reserved, subject to certain closing-related reductions, the Company issued 2,889,367 shares of the Company's common stock in connection with the Business Acquisition in the third quarter of 2021, after certain closing-related deductions. 171,427 , 177,203 , and 182,182 shares of the Company’s common stock reserved in connection with the Motus acquisition were issued as acquisition consideration on the first, second and third anniversaries of the closing date of the acquisition, respectively, in each case subject to certain reductions. During the third quarter of 2025 and first quarter of 2026, development milestones in connection with the Motus acquisition were achieved, resulting in the issuance of 364,566 shares of the Company's common stock in October 2025 and 364,397 shares of the Company's common stock in March 2026, respectively. Additional shares of the Company's common stock will also be issued upon the achievement of certain development and regulatory milestone events, subject to certain reductions. As of March 31, 2026, 4,979,705 shares of the Company's common stock remain reserved for the Business Acquisition.
Preferred Stock—As of March 31, 2026, the Company had 200,000,000 shares of preferred stock authorized with a par value of $0.01 per share and no
13. Stock-Based Compensation
The Company's current equity compensation plan, the Insmed Incorporated Amended and Restated 2019 Incentive Plan (the 2019 Incentive Plan), was approved by shareholders at the Company's Annual Meeting of Shareholders on May 13, 2023. The 2019 Incentive Plan replaced the Insmed Incorporated 2019 Incentive Plan, as amended, and provided for awards of up to an aggregate of 24,250,000 shares (including the shares previously available for grant under the Insmed Incorporated 2019 Incentive Plan). At the Company's 2024 Annual Meeting of Shareholders, the Company's shareholders approved Amendment No. 1 to the 2019 Incentive Plan, which provides for the issuance of an additional 3,000,000 shares under the 2019 Incentive Plan. At the Company's 2025 Annual Meeting of Shareholders, the Company's shareholders approved Amendment No. 2 to the 2019 Incentive Plan, which provides for the issuance of an additional 10,000,000 shares under the 2019 Incentive Plan. As of March 31, 2026, 10,126,431 shares remain available for future issuance under the 2019 Incentive Plan. The 2019 Incentive Plan will terminate on April 3, 2029, unless it is extended or terminated earlier pursuant to its terms.
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INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
13. Stock-Based Compensation (Continued)
In addition, from time to time, the Company makes inducement grants of stock options and RSUs to new hires, which awards are made pursuant to the Nasdaq's inducement grant exception to the shareholder approval requirement for grants of equity compensation. The Company granted inducement stock options and RSUs covering 73,657 shares of the Company's common stock to new employees during the three months ended March 31, 2026. In February 2025, the Company adopted the Insmed Incorporated 2025 Inducement Plan, under which the Company is authorized to grant a variety of inducement awards, including stock options and RSUs, up to an aggregate of 1,000,000 shares, as an inducement to become an employee of the Company or any of its subsidiaries. As of March 31, 2026, 626,576 shares remain available for future issuance under the Insmed Incorporated 2025 Inducement Plan.
On May 15, 2018, the 2018 Employee Stock Purchase Plan (ESPP) was approved by shareholders at the Company's 2018 Annual Meeting of Shareholders. The ESPP allows eligible employees to acquire an ownership interest in the Company by purchasing common stock, at a discount, through payroll deductions. The Company has reserved the following for issuance under the ESPP: (i) 1,000,000 shares of common stock, plus (ii) commencing on January 1, 2019 and ending on December 31, 2023, an additional number of shares added on the first day of each calendar year equal to the lesser of (A) 1,200,000 shares of common stock, (B) 2 % of the number of outstanding shares of common stock on such date and (C) an amount determined by the administrator.
Stock Options—As of March 31, 2026, there was $163.4 million of unrecognized compensation expense related to unvested stock options. As of March 31, 2026, the Company had performance-conditioned options totaling 114,780 shares outstanding which had not yet met the recognition criteria.
Restricted Stock Units—As of March 31, 2026, there was $260.1 million of unrecognized compensation expense related to unvested RSU awards.
Performance Stock Units—As of March 31, 2026, there were 92,219 PSUs outstanding with an unrecognized compensation expense of $18.1 million, which assumes a 100 % payout for these awards.
The following table summarizes the aggregate stock-based compensation expense recorded in the consolidated statements of comprehensive loss related to stock options, RSUs, PSUs and the ESPP during the three months ended March 31, 2026 and 2025 (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Research and development expenses | $ | $ | |||||||||||||||||||||
| Selling, general and administrative expenses | |||||||||||||||||||||||
| Total stock-based compensation expense | $ | $ | |||||||||||||||||||||
14. Income Taxes
The Company recorded a provision for income taxes of $1.5 million and $0.9 million for the three months ended March 31, 2026 and 2025, respectively. The provisions recorded for the three months ended March 31, 2026 and 2025 are primarily a result of the Company's international subsidiaries that had taxable income during the periods and income tax on modified gross revenues imposed by certain US states. There was a full valuation allowance recorded against the Company's deferred tax assets and therefore no tax benefit was recorded.
The Company is subject to US federal, state and international income taxes and the statute of limitations for tax audit is open for the Company’s federal tax returns for the years ended 2022 and later, generally open for certain states for the years 2021 and later, and generally open for international jurisdictions for the years 2020 and later. The Company has incurred net operating losses since inception, except for the year ended December 31, 2009. Such loss carryforwards would be subject to audit in any tax year in which those losses are utilized, notwithstanding the year of origin. As of March 31, 2026 and December 31, 2025, the Company had recorded reserves for unrecognized income tax benefits against certain deferred tax assets in the US. However, given the Company’s valuation allowance position, these reserves do not have an impact on the balance sheet as of March 31, 2026 and December 31, 2025 or the consolidated statements of comprehensive loss for the three months ended March 31, 2026 and 2025. The Company has no
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INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Commitments
The Company has entered into various commitments including, but not limited to, asset acquisition and license agreements. See Note 16 - Commitments and Contingencies in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 for further information.
Rent expense charged to operations was $3.5
Legal Proceedings
From time to time, the Company is a party to various lawsuits, claims and other legal proceedings that arise in the ordinary course of business. While the outcomes of these matters are uncertain, management does not expect that the ultimate costs to resolve these matters will have a material adverse effect on the Company's consolidated financial position, results of operations or cash flows.
16. Segment Reporting
The Company manages its business activities on a consolidated basis and operates as a single operating segment. The Company derives its revenues from the development and commercialization of therapies for patients facing serious diseases. The accounting policies of the segment are the same as those described in Note 2 – Summary of Significant Accounting Policies.
The Company has a single management team that reports to the Chief Executive Officer, the chief operating decision maker (CODM), who comprehensively manages the entire business. When evaluating the Company’s financial performance, the CODM regularly reviews total revenues, total expenses, and expenses by function, and makes decisions using this information on a global basis. The CODM uses net loss, as reported in the consolidated statements of comprehensive loss, in evaluating the performance of the segment. Decisions regarding resource allocation are made primarily during the annual budget planning process and augmented as needed throughout the year. The measure of segment assets is reported on the balance sheet as total assets. The Company does not operate separate lines of business with respect to its products or product candidates. Accordingly, the Company has one reportable segment.
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INSMED INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
16. Segment Reporting (Continued)
Segment loss, including significant segment expenses, for the three months ended March 31, 2026 and 2025 was as follows (in thousands):
| Three Months Ended March 31, | |||||||||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||||||||
| Product revenues, net | $ | $ | |||||||||||||||||||||||||||
| Less: | |||||||||||||||||||||||||||||
| Cost of product revenues (excluding amortization of intangible assets) | |||||||||||||||||||||||||||||
| ARIKAYCE external R&D expenses | |||||||||||||||||||||||||||||
| Brensocatib external R&D expenses | |||||||||||||||||||||||||||||
| TPIP external R&D expenses | |||||||||||||||||||||||||||||
| Other external R&D expenses | |||||||||||||||||||||||||||||
| R&D compensation and benefit-related expenses | |||||||||||||||||||||||||||||
| SG&A compensation and benefit-related expenses | |||||||||||||||||||||||||||||
Other segment items(a) | |||||||||||||||||||||||||||||
| Depreciation | |||||||||||||||||||||||||||||
| Amortization of intangible assets | |||||||||||||||||||||||||||||
Change in fair value of contingent consideration | ( | ||||||||||||||||||||||||||||
| Investment income | ( | ( | |||||||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||||||||
| Provision for income taxes | |||||||||||||||||||||||||||||
| Segment net loss | $ | ( | $ | ( | |||||||||||||||||||||||||
(a) Other segment items include stock-based compensation, professional fees, and facility-related expenses.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties. "Forward-looking statements," as that term is defined in the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are statements that are not historical facts and involve a number of risks and uncertainties. Words herein such as "may," "will," "should," "could," "would," "expects," "plans," "anticipates," "believes," "estimates," "projects," "predicts," "intends," "potential," "continues," and similar expressions (as well as other words or expressions referencing future events, conditions or circumstances) identify forward-looking statements.
Forward-looking statements are based on our current expectations and beliefs, and involve known and unknown risks, uncertainties and other factors, which may cause our actual results, performance and achievements and the timing of certain events to differ materially from the results, performance, achievements or timing discussed, projected, anticipated or indicated in any forward-looking statements. Such risks, uncertainties and other factors include, among others, the following:
•failure to continue to successfully commercialize ARIKAYCE in the US, Europe or Japan (amikacin liposome inhalation suspension, Liposomal 590 mg Nebuliser Dispersion, and amikacin sulfate inhalation drug product, respectively) or failure to successfully commercialize BRINSUPRI in the US or Europe, or to maintain US, European or Japanese approval for ARIKAYCE or US or European approval for BRINSUPRI;
•our inability to obtain full approval of ARIKAYCE from the FDA, or our failure to obtain regulatory approval to expand ARIKAYCE’s indication to a broader patient population;
•failure to obtain, or delays in obtaining, regulatory approvals for our product candidates in the US, Europe or Japan, for ARIKAYCE outside of the US, Europe and Japan, including separate regulatory approval for Lamira in each market and for each usage, or for BRINSUPRI outside of the US and Europe;
•failure to successfully commercialize our product candidates, if approved by applicable regulatory authorities, or to maintain applicable regulatory approvals for such product candidates, if approved;
•uncertainties or changes in the degree of market acceptance of our marketed products or, if approved, our product candidates, by physicians, patients, third-party payors and others in the healthcare community;
•our inability to obtain and maintain adequate reimbursement from government or third-party payors for our marketed products or, if approved, our product candidates, or acceptable prices for our marketed products or, if approved, our product candidates;
•inaccuracies in our estimates of the size of the potential markets for our marketed products and our product candidates or in data we have used to identify physicians, expected rates of patient uptake, duration of expected treatment, or expected patient adherence or discontinuation rates;
•failure of third parties on which we are dependent to manufacture sufficient quantities of our marketed products and our product candidates for commercial or clinical needs, as applicable, to conduct our clinical trials, or to comply with our agreements or laws and regulations that impact our business;
•risks and uncertainties associated with, and the perceived benefits of, our senior secured loan with certain funds managed by Pharmakon and our royalty financing with OrbiMed, including our ability to maintain compliance with the covenants in the agreements for the senior secured loan and royalty financing and the impact of the restrictions on our operations under these agreements;
•our inability to create or maintain an effective direct sales and marketing infrastructure or to partner with third parties that offer such an infrastructure for distribution of our marketed products or any of our product candidates that are approved in the future;
•failure to successfully conduct future clinical trials for our marketed products or our product candidates and our potential inability to enroll or retain sufficient patients to conduct and complete the trials or generate data necessary for regulatory approval of our product candidates;
•development of unexpected safety or efficacy concerns related to our marketed products or our product candidates;
•risks that our clinical studies will be delayed, that serious side effects will be identified during drug development, or that any protocol amendments submitted will be rejected;
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•failure to successfully predict the time and cost of development, regulatory approval and commercialization for novel gene therapy products;
•risk that interim, topline or preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available or may be interpreted differently if additional data are disclosed, or that blinded data will not be predictive of unblinded data;
•risk that our competitors may obtain orphan drug exclusivity for a product that is essentially the same as a product we are developing for a particular indication;
•our inability to attract and retain key personnel or to effectively manage our growth;
•our inability to successfully integrate our acquisitions and appropriately manage the amount of management’s time and attention devoted to integration activities;
•risks that our acquired technologies, products and product candidates will not be commercially successful;
•inability to adapt to our highly competitive and changing environment;
•inability to access, upgrade or expand our technology systems or difficulties in updating our existing technology or developing or implementing new technology;
•risk that we are unable to maintain our significant customers;
•risk that healthcare legislation or other government action materially adversely affects our business;
•business or economic disruptions due to catastrophes or other events, including natural disasters or public health crises;
•risk that our current and potential future use of AI and machine learning may not be successful;
•deterioration in general economic conditions in the US, Europe, Japan and globally, including the effect of prolonged periods of inflation, affecting us, our suppliers, third-party service providers and potential partners;
•risk that we could become involved in costly intellectual property disputes, be unable to adequately protect our intellectual property rights or prevent disclosure of our trade secrets and other proprietary information, and incur costs associated with litigation or other proceedings related to such matters;
•restrictions or other obligations imposed on us by agreements related to our marketed products or our product candidates, including our license agreements with PARI and AstraZeneca, and failure to comply with our obligations under such agreements;
•the cost and potential reputational damage resulting from litigation to which we are or may become a party, including product liability claims;
•risk that our operations are subject to a material disruption in the event of a cybersecurity attack or issue;
•changes in laws and regulations applicable to our business, including any pricing reform and laws that impact our ability to utilize certain third parties in the research, development or manufacture of our product candidates, and failure to comply with such laws and regulations;
•our history of operating losses, and the possibility that we never achieve or maintain profitability;
•goodwill impairment charges affecting our results of operations and financial condition;
•inability to repay our existing indebtedness and uncertainties with respect to our ability to access future capital; and
•delays in the execution of plans to build out an additional third-party manufacturing facility approved by the appropriate regulatory authorities and unexpected expenses associated with those plans.
We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date they are made. Any forward-looking statement is based on information current as of the date of this Quarterly Report on Form 10-Q and speaks only as of the date on which such statement is made. Actual events or results may differ materially from the results, plans, intentions or expectations anticipated in these forward-looking statements as a result of a variety of factors, many of which are beyond our control. More information on factors that could cause actual results to differ materially from those anticipated is included from time to time in our reports filed with the Securities and Exchange Commission (SEC), including, but not limited to, those described in the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report on Form 10-Q and included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. We disclaim any obligation, except as specifically required by law and the rules of the SEC, to publicly update or revise any such statements to reflect any change in our expectations or in events,
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conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.
The following discussion should be read in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and the consolidated financial statements and related notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2025.
OVERVIEW
We are a people-first global biopharmaceutical company striving to deliver first- and best-in-class therapies to transform the lives of patients facing serious diseases. Our commercial portfolio and clinical pipeline are organized around three therapeutic areas: Respiratory, Immunology & Inflammation, and Neuro & Other Rare. To complement our internal research and development, we also actively evaluate in-licensing and acquisition opportunities for commercial products, product candidates, and technologies.
Our two commercial products, ARIKAYCE and BRINSUPRI, are both part of the Respiratory therapeutic area. ARIKAYCE is approved in the US as ARIKAYCE (amikacin liposome inhalation suspension), in Europe as ARIKAYCE Liposomal 590 mg Nebuliser Dispersion and in Japan as ARIKAYCE inhalation 590mg (amikacin sulfate inhalation drug product). ARIKAYCE received accelerated approval in the US in September 2018 for the treatment of MAC lung disease as part of a combination antibacterial drug regimen for adult patients with limited or no alternative treatment options in a refractory setting. In October 2020, the EC approved ARIKAYCE Liposomal for the treatment of NTM lung infections caused by MAC in adults with limited treatment options who do not have CF. In March 2021, Japan's MHLW approved ARIKAYCE for the treatment of patients with NTM lung disease caused by MAC who did not sufficiently respond to prior treatment with a multidrug regimen. NTM lung disease caused by MAC (which we refer to as MAC lung disease) is a rare and often chronic infection that can cause irreversible lung damage and can be fatal. We are not aware of any other approved inhaled therapies specifically indicated to treat MAC lung disease in North America, Europe, or Japan.
BRINSUPRI (brensocatib 25 mg and 10 mg tablets), an oral, once-daily treatment for non-cystic fibrosis bronchiectasis (referred to as bronchiectasis or NCFB) in patients 12 years of age and older, was approved in the US in August 2025. In November 2025, the EC approved BRINSUPRI (brensocatib 25 mg tablets) for the treatment of NCFB in patients 12 years of age and older with two or more exacerbations in the prior 12 months. In February 2026, the MHRA granted a marketing authorisation for BRINSUPRI to treat patients 12 years and older with NCFB who have experienced two or more flare-ups or worsening of symptoms in the past 12 months. Bronchiectasis is a serious, chronic lung disease in which the bronchi become permanently dilated due to a cycle of infection, inflammation, and lung tissue damage. We are not aware of any other approved therapies in the US, Europe, or Japan for the treatment of patients with bronchiectasis.
Our Respiratory therapeutic area also includes the clinical-stage programs TPIP and INS1148. TPIP is an inhaled dry powder formulation of the treprostinil prodrug treprostinil palmitil which may offer a differentiated product profile for PH-ILD, PAH, PPF, and IPF. INS1148 is a monoclonal antibody targeting SCF248, which we plan to initially develop for PPF and IPF.
Our Immunology & Inflammation therapeutic area is exploring opportunities utilizing our various technologies.
The clinical-stage programs in our Neuro & Other Rare therapeutic area are INS1201, an intrathecally delivered gene therapy for patients with DMD, and INS1202, an intrathecally delivered gene therapy for patients with ALS.
Our pre-clinical research programs encompass a wide range of technologies and modalities, including gene therapy, AI-driven protein engineering, RNA end-joining, and synthetic rescue.
Prior to 2019, we had not generated significant revenue and, through March 31, 2026, we had an accumulated deficit of $5.8 billion. We have financed our operations primarily through the public offerings of our equity securities, debt financings and revenue interest financings. Although it is difficult to predict our future funding requirements, based upon our current operating plan, we anticipate that our cash and cash equivalents and marketable securities as of March 31, 2026 will enable us to fund our operations for at least the next 12 months.
Our ability to reduce our operating loss and begin to generate positive cash flow from operations depends on the continued success in commercializing our marketed products and obtaining full approval of ARIKAYCE in the US. Our continued success also depends on bringing additional clinical stage products, such as TPIP, INS1148, INS1201, and INS1202, to market, and advancing our pre-clinical research programs. We expect to continue to incur substantial expenses related to our research and development activities as we conduct trials of TPIP in PH-ILD, PAH, PPF, and IPF, and fund development of our clinical and pre-clinical programs. We also expect to continue to incur significant costs related to the commercialization of our marketed products. Our financial results may fluctuate from quarter to quarter and will depend on, among other factors, the net sales of our marketed products; the scope and progress of our research and development efforts; and the timing of certain expenses. We cannot predict whether or when new products or new indications for marketed products will receive regulatory
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approval or, if any such approval is received, whether we will be able to successfully commercialize such products and whether or when we may become profitable.
The information below summarizes our updates and anticipated near-term milestones for our marketed products and our product candidates.
Respiratory
BRINSUPRI
•In August 2025, BRINSUPRI (brensocatib 25 mg and 10 mg tablets), an oral, once-daily treatment for NCFB in adults and children 12 years and older, was approved in the US by the FDA. We launched BRINSUPRI in the US in the third quarter of 2025.
•In November 2025, the EC approved BRINSUPRI (brensocatib 25 mg tablets) for the treatment of NCFB in patients 12 years of age and older with two or more exacerbations in the prior 12 months.
•In February 2026, the MHRA granted marketing authorisation for BRINSUPRI (brensocatib 25 mg tablets) for the treatment of NCFB in patients 12 years of age and older with two or more flare-ups or worsening of symptoms in the past 12 months.
•We anticipate a regulatory decision for brensocatib for the treatment of NCFB in Japan in 2026.
•We continue to evaluate the potential effect of evolving US policies which will then impact the timing for future potential international commercial launches.
ARIKAYCE
•In March 2026, we reported positive topline results from the Phase 3b ENCORE study, which met its primary and all multiplicity-controlled secondary culture conversion endpoints.
•We anticipate submitting a US supplemental new drug application (sNDA) for ARIKAYCE in all patients with MAC lung disease in the second half of 2026. We also plan to review the data with the Pharmaceuticals and Medical Devices Agency (PMDA) to support potential label expansion in Japan in the second half of 2026.
TPIP
•We initiated PALM-ILD, a Phase 3 study of TPIP in patients with PH-ILD, in the fourth quarter of 2025 and are actively enrolling patients.
•In January 2026, the Office of Orphan Products Development of the FDA granted orphan drug designation to treprostinil palmitil for the treatment of patients with PAH. In April 2026, we initiated the Phase 3 PALM-PAH study of TPIP in patients with PAH.
•We expect to report data from the open-label extension (OLE) of our Phase 2b study of TPIP in PAH in the third quarter of 2026.
•We anticipate initiating a Phase 3 study of TPIP in patients with PPF in the second half of 2026 and a Phase 3 study in patients with IPF in the first half of 2027.
INS1148
•In December 2025, we acquired INS1148, a Phase 2-ready monoclonal antibody targeting SCF248.
•We plan to advance a Phase 2 development program for INS1148, initially targeting PPF and IPF, and we are exploring other diseases where inhibition of the inflammatory functions of SCF248 may be beneficial.
We are exploring additional opportunities utilizing our various technologies within the Respiratory therapeutic area.
Immunology & Inflammation
We are exploring opportunities utilizing our various technologies within the Immunology & Inflammation therapeutic area.
Neuro & Other Rare
INS1201
•We continue to enroll patients in the Phase 1 ASCEND clinical study of INS1201 for patients with DMD.
INS1202
•We continue to enroll patients in the Phase 1 ARMOR clinical study of INS1202 for patients with ALS.
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We are exploring additional opportunities utilizing our various technologies within the Neuro & Other Rare therapeutic area.
Our Strategy
We strive to develop and commercialize first- and best-in-class therapies that serve patient communities where the need is greatest. Our commercial portfolio and clinical pipeline are organized around three therapeutic areas: Respiratory, Immunology & Inflammation, and Neuro & Other Rare. Our Respiratory therapeutic area includes our commercial products ARIKAYCE and BRINSUPRI and the clinical-stage product candidates TPIP and INS1148. Our first product, ARIKAYCE, is approved in the US as ARIKAYCE (amikacin liposome inhalation suspension), in Europe as ARIKAYCE Liposomal 590 mg Nebuliser Dispersion and in Japan as ARIKAYCE inhalation 590mg (amikacin sulfate inhalation drug product). Our second commercial product, BRINSUPRI, was approved in the US, EU, and UK in August 2025, November 2025, and February 2026, respectively, for the treatment of NCFB. The regulatory submission for brensocatib in Japan has been accepted. TPIP is our product candidate that may offer a differentiated product profile for patients with PH-ILD, PAH, PPF, and IPF. INS1148 is a monoclonal antibody targeting SCF248, which we plan to initially develop for PPF and IPF. Our Immunology & Inflammation therapeutic area is exploring opportunities utilizing our various technologies. Our Neuro & Other Rare therapeutic area includes INS1201, our intrathecally delivered gene therapy product candidate for patients with DMD, and INS1202, our intrathecally delivered gene therapy product candidate for patients with ALS. We are also advancing pre-clinical research programs encompassing a wide range of technologies and modalities, including gene therapy, AI-driven protein engineering, RNA end-joining, and synthetic rescue.
Our key priorities are as follows:
•Ensure successful US commercial launch of BRINSUPRI;
•Continue to provide ARIKAYCE to appropriate patients and expand our label;
•Advance our pipeline and produce topline clinical data readouts in the near and long term; and
•Control spending, prudently deploying capital to support the best return-generating opportunities.
Respiratory
BRINSUPRI
BRINSUPRI (brensocatib 25 mg and 10 mg tablets), an oral, once-daily treatment for NCFB in adults and children 12 years and older, was approved in the US by the FDA in August 2025. In November 2025, BRINSUPRI (brensocatib 25 mg tablets), an oral, once-daily treatment for NCFB in adults and children 12 years and older with two or more exacerbations in the prior 12 months, was approved by the EC. In February 2026, the MHRA granted a marketing authorisation for BRINSUPRI to treat patients 12 years and older with NCFB who have experienced two or more flare-ups or worsening of symptoms in the past 12 months. A regulatory submission for brensocatib in Japan has been accepted.
Brensocatib is a small molecule, reversible inhibitor of DPP1, which we licensed from AstraZeneca in October 2016. DPP1 is an enzyme responsible for activating neutrophil serine proteases (NSPs) in neutrophils when they are formed in the bone marrow. Neutrophils are the most common type of white blood cell and play an essential role in pathogen destruction and inflammatory mediation. Neutrophils contain the NSPs (including neutrophil elastase, proteinase 3, and cathepsin G) that have been implicated in a variety of inflammatory diseases. In chronic inflammatory lung diseases, neutrophils accumulate in the airways and result in excessive active NSPs that cause lung destruction and inflammation. Brensocatib may decrease the damaging effects of inflammatory diseases such as bronchiectasis by inhibiting DPP1 and its activation of NSPs.
In June 2020, the FDA granted breakthrough therapy designation for brensocatib for the treatment of adult patients with NCFB for reducing exacerbations. In November 2020, brensocatib was granted access to the PRIME scheme from the EMA for patients with NCFB. In October 2021, the EMA’s Paediatric Committee approved the brensocatib Pediatric Investigational Plan (the PIP) for the treatment of patients with NCFB. As a result, the ASPEN trial included 41 adolescent patients between ages 12 to 17, which trial design satisfied the pediatric study requirements to support marketing applications in this patient population in the US, Europe and Japan. As a condition of BRINSUPRI’s approval in the US, we agreed with the FDA to conduct a pediatric post marketing study of BRINSUPRI in children between ages 6 and 11. We are also required to continue to progress the PIP notwithstanding BRINSUPRI’s approval in the EU.
The ASPEN Study
Based on positive results of our Phase 2b study of brensocatib in patients with NCFB (the WILLOW study), in December 2020 we commenced the ASPEN study, a global, randomized, double-blind, placebo-controlled Phase 3 study to assess the efficacy, safety, and tolerability of brensocatib in adult patients with bronchiectasis. Patients with bronchiectasis due to CF were not enrolled in the study. The primary endpoint was the rate of adjudicated pulmonary exacerbations (PEs) over the 52-week treatment period. Secondary endpoints included the time to first adjudicated PE, the proportion of subjects free of adjudicated PE by 52 weeks, the absolute change from baseline in post-bronchodilator FEV1, the reduction in annualized rate
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of severe adjudicated PE, and the change from baseline in the Bronchiectasis QOL-B Respiratory Symptoms Domain Score.
As part of the ASPEN study, more than 460 trial sites were engaged in nearly 40 countries. After excluding sites that did not enroll any patients and all sites in Ukraine, due to the ongoing conflict, the total number of active sites in ASPEN was 391 sites in 35 countries. Adult patients (ages 18 to 85 years) were randomized 1:1:1 and adolescent patients (ages 12 to <18 years) were randomized 2:2:1 for treatment with brensocatib 10 mg, brensocatib 25 mg, or placebo once daily for 52 weeks, followed by 4 weeks off treatment.
ASPEN Safety Information and Efficacy Data
We announced positive topline results from the ASPEN trial in May 2024. Results from the ASPEN trial were published in the New England Journal of Medicine in April 2025. The primary efficacy analysis included data from 1,680 adult patients and 41 adolescent patients. Brensocatib was well-tolerated in the study. In addition, the study met its primary endpoint, with both dosage strengths of brensocatib demonstrating statistically significant reductions in the annualized rate of adjudicated PEs versus placebo. The study also met several of its prespecified secondary endpoints with statistical significance.
Topline efficacy results from the ASPEN study were as follows:
| Brensocatib 10 mg compared to placebo | Brensocatib 25 mg compared to placebo | ||||||||||||||||
| Primary Endpoint | |||||||||||||||||
| Reduction in annualized rate of PEs | 21.1% | p=0.0019* | 19.4% | p=0.0046* | |||||||||||||
| Secondary Endpoints | |||||||||||||||||
| Prolongation of time to first PE | 18.7% | p=0.0100* | 17.5% | p=0.0182* | |||||||||||||
| Increase in odds of remaining exacerbation free over 52 weeks | 41.2% | p=0.0059* | 40.0% | p=0.0074* | |||||||||||||
| Change from baseline in post-bronchodilator forced expiratory volume in 1 second (FEV1) at week 52 | 11 mL | p=0.3841 | 38 mL | p=0.0054* | |||||||||||||
| Reduction in annualized rate of severe PEs | 25.8% | p=0.1277 | 26.0% | p=0.1025 | |||||||||||||
| Change from baseline in the Quality of Life – Bronchiectasis (QOL-B) Respiratory Score at week 52 | 2.0 points | p=0.0594 | 3.8 points | p=0.0004^ | |||||||||||||
* - Statistically significant | |||||||||||||||||
^ - Nominally significant p-value | |||||||||||||||||
ARIKAYCE for Patients with MAC Lung Disease
ARIKAYCE is our first approved product. ARIKAYCE received accelerated approval in the US in September 2018 for the treatment of refractory MAC lung disease as part of a combination antibacterial drug regimen for adult patients with limited or no alternative treatment options. In October 2020, ARIKAYCE received approval in Europe for the treatment of NTM lung infections caused by MAC in adults with limited treatment options who do not have CF. In March 2021, ARIKAYCE received approval in Japan for the treatment of patients with NTM lung disease caused by MAC who did not sufficiently respond to prior treatment with a multidrug regimen. MAC lung disease is a rare and often chronic infection that can cause irreversible lung damage and can be fatal. Amikacin solution for parenteral administration is an established drug that has activity against a variety of NTM; however, its use is limited by the need to administer it intravenously and by toxicity to hearing, balance, and kidney function. Unlike amikacin solution for intravenous administration, our proprietary Pulmovance™ technology uses charge-neutral liposomes to deliver amikacin directly to the lungs where liposomal amikacin is taken up by the lung macrophages where the MAC infection resides. This technology also prolongs the release of amikacin in the lungs, while minimizing systemic exposure, thereby offering the potential for decreased systemic toxicities. ARIKAYCE's ability to deliver high levels of amikacin directly to the lung and sites of MAC infection via the use of our Pulmovance technology distinguishes it from intravenous amikacin. ARIKAYCE is administered once-daily using Lamira, an inhalation device developed and manufactured by PARI. Lamira is a portable nebulizer that enables aerosolization of liquid medications via a vibrating, perforated membrane, and was designed specifically for ARIKAYCE delivery.
The FDA has designated ARIKAYCE as an orphan drug and a Qualified Infectious Disease Product (QIDP) for NTM lung disease. Orphan designated drugs are eligible for seven years of exclusivity for the orphan indication. QIDP designation provides an additional five years of exclusivity for the designated indication. The FDA granted a total of 12 years of exclusivity in the indication for which ARIKAYCE was approved.
ARIKAYCE also has been included in the international treatment guidelines for NTM lung disease. The evidence-based guidelines, issued by the American Thoracic Society (ATS), European Respiratory Society (ERS), European Society of Clinical Microbiology and Infectious Diseases (ESCMID), and Infectious Diseases Society of America (IDSA), strongly
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recommend the use of ARIKAYCE for MAC lung disease as part of a combination antibacterial drug regimen for adult patients with limited or no alternative treatment options who have failed to convert to a negative sputum culture after at least six months of treatment.
In October 2020, the FDA approved an sNDA for ARIKAYCE, adding important efficacy data regarding the durability and sustainability of culture conversion to the ARIKAYCE label. The data, which are from the Company's Phase 3 study of ARIKAYCE (the CONVERT study), demonstrate that the addition of ARIKAYCE to guideline-based therapy (GBT) was associated with sustained culture conversion through the end of treatment as well as durable culture conversion three months post-treatment compared with GBT alone.
Accelerated Approval and Post-Marketing Confirmatory Clinical Trial
In September 2018, the FDA granted accelerated approval for ARIKAYCE under the Limited Population Pathway for Antibacterial and Antifungal Drugs (LPAD) for the treatment of refractory MAC lung disease as part of a combination antibacterial drug regimen for adult patients with limited or no alternative treatment options. LPAD, which was enacted as part of the 21st Century Cures Act, serves to advance the development of new antibacterial drugs to treat serious or life-threatening infections in limited populations of patients with unmet needs. As required for drugs approved under the LPAD pathway, labeling for ARIKAYCE includes certain statements to convey that the drug has been shown to be safe and effective only for use in a limited population.
As a condition of accelerated approval, we must conduct a post-marketing confirmatory clinical trial. In December 2020, we commenced the post-marketing confirmatory clinical trial program for ARIKAYCE in patients with MAC lung disease consisting of the ARISE trial, an interventional study designed to validate cross-sectional and longitudinal characteristics of a patient-reported outcome (PRO) tool in MAC lung disease, and the ENCORE trial, designed to establish the clinical benefits and evaluate the safety of ARIKAYCE in patients with newly diagnosed or recurrent MAC lung infection who have not started antibiotics using the PRO tool validated in the ARISE trial. In September 2023, we announced positive topline results from the ARISE trial. The study met its primary objective of demonstrating that the QOL-B respiratory domain works effectively as a PRO tool in patients with MAC lung disease. Based on feedback and in alignment with the FDA, we determined that the primary endpoint for the ENCORE study would include eight questions from the QOL-B respiratory domain PRO.
The ARISE Study
The ARISE trial was a global, randomized, double-blind, placebo-controlled Phase 3b study in adult patients with newly diagnosed or recurrent MAC infections that aimed to generate evidence demonstrating the domain specification, reliability, validity, and responsiveness of PRO-based scores, including a respiratory symptom score. The ARISE study met its primary objective of demonstrating that the QOL-B respiratory domain works effectively as a PRO tool in patients with MAC lung disease.
Patients in ARISE (N=99) were randomized 1:1 to treatment with ARIKAYCE plus macrolide-based background regimen (ARIKAYCE arm) or placebo plus macrolide-based background regimen (comparator arm) once daily for six months, followed by one month off treatment. ARIKAYCE-treated patients performed better than those in the comparator arm as measured by the QOL-B instrument, with 43.8% of patients achieving an improvement in QOL-B respiratory score above the estimated meaningful within-subject score difference of 14.8, compared with 33.3% of patients in the comparator arm. While the study was not powered to show a statistically significant difference between treatment arms, a strong trend toward significance was observed for improvement from baseline at Month 7 (12.24 vs. 7.76, p=0.1073). Patients in the ARIKAYCE arm also achieved nominally statistically significantly higher culture conversion rates at Month 7 versus patients in the comparator arm (78.8% vs. 47.1%, p=0.0010), and culture conversion was faster and more likely to persist through Month 7 for the ARIKAYCE arm, suggesting that ARIKAYCE-treated patients are more likely to remain negative.
Consistent with our expectations, the FDA and the PMDA in Japan confirmed that they would not consider a label expansion for ARIKAYCE based on data from the ARISE study alone.
ARISE Culture Conversion
Consistent with prior clinical studies, a higher proportion of patients in the ARIKAYCE arm achieved culture conversion by Month 6 (defined as negative cultures at Months 5 and 6) compared to patients in the comparator arm (80.6% vs. 63.9%, p=0.0712). Among patients who achieved culture conversion by Month 6, more patients in the ARIKAYCE arm achieved the first of their two required monthly negative cultures for clinical conversion at Month 1 versus the comparator arm (74.3% vs. 46.7%). As reported above, at Month 7 (one month following the cessation of treatment), 78.8% of patients in the ARIKAYCE arm vs. 47.1% of patients in the comparator arm were culture-converted, suggesting that ARIKAYCE-treated patients are more likely to remain negative.
Correlation Between ARISE Culture Conversion and QOL-B Performance
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Patients in the ARIKAYCE arm who achieved culture conversion at both Month 6 and Month 7 had nominally statistically significantly greater improvements in QOL-B respiratory domain scores at Month 7 compared to patients in the ARIKAYCE arm who did not achieve culture conversion (15.74 vs. 3.53, p=0.0167 at Month 6 and 14.89 vs. 4.50, p=0.0416 at Month 7).
ARISE Safety and Tolerability
The discontinuation rate of ARIKAYCE or the placebo used in the comparator arm was 22.9% in the ARIKAYCE arm and 7.8% in the comparator arm. Study completion rates were 91.7% in the ARIKAYCE arm and 94.1% in the comparator arm. No new safety events were observed in the ARIKAYCE arm, and the safety profile in general was as expected in both treatment arms. Treatment-emergent adverse events (TEAEs) were reported by 91.7% of patients in the ARIKAYCE arm and 80.4% of patients in the comparator arm. The most common TEAEs were dysphonia (41.7% for the ARIKAYCE arm vs. 3.9% for the comparator arm), cough (27.1% vs. 7.8%), diarrhea (27.1% vs. 25.5%), and COVID-19 (12.5% vs. 9.8%). Of the treatment-emergent serious adverse events observed in the trial, none were determined to be related to ARIKAYCE by investigators.
The ENCORE Study
The ENCORE study was a randomized, double-blind, placebo-controlled Phase 3b study to evaluate the efficacy and safety of an ARIKAYCE-based regimen in patients with newly diagnosed or recurrent MAC infection who had not started antibiotics. Patients were screened and enrolled at 177 sites globally, and a total of 425 patients were randomized 1:1 to receive ARIKAYCE plus background regimen or placebo plus background regimen once daily for 12 months. Patients then discontinued all study treatments and remained in the trial for three months for the assessment of durability of culture conversion. The primary endpoint was change from baseline to Month 13 in respiratory symptom score. The key secondary endpoint was the proportion of subjects achieving durable culture conversion at Month 15. Based on feedback and in alignment with the FDA, the primary endpoint for the ENCORE study included eight questions from the QOL-B respiratory domain PRO.
We announced positive topline results from the ENCORE study in March 2026. Topline efficacy results from the ENCORE study were as follows:
| ARIKAYCE 590 mg plus azithromycin 250 mg + ethambutol 15 mg/kg once-daily (N=213) | Placebo plus azithromycin 250 mg + ethambutol 15 mg/kg once-daily (N=212) | Treatment difference, p-value | |||||||||
| Primary Endpoint | |||||||||||
| Change from Baseline in Respiratory Symptom Score at Month 13 | 17.77 points | 14.66 points | 3.11 points, p=0.0299* | ||||||||
| Multiplicity-Controlled Secondary Endpoints | |||||||||||
| Culture Conversion by Month 6 | 87.8% | 57.0% | 30.8%, p<0.0001* | ||||||||
| Culture Conversion by Month 12 | 84.7% | 61.3% | 23.3%, p<0.0001* | ||||||||
| Culture Conversion by Month 13 | 82.4% | 55.6% | 26.8%, p<0.0001* | ||||||||
| Durable Culture Conversion at Month 15 | 76.2% | 47.6% | 28.6%, p<0.0001* | ||||||||
| Change from Baseline in PROMIS Fatigue T-score at Month 13 | -5.07 | -4.27 | -0.81, p=0.2900 | ||||||||
| Other Secondary & Exploratory Endpoints | |||||||||||
| Meeting the Meaningful Within-Patient Change (MWPC) Threshold as Reflected in the Change in Respiratory Symptom Scores Computed from Baseline to Month 13 | MWPC=16.67 53.4% | MWPC=16.67 45.4% | MWPC=16.67 8.0%, p=0.0570** | ||||||||
| MWPC=20.83 43.5% | MWPC=20.83 35.3% | MWPC=20.83 8.2%, p=0.0390** | |||||||||
| Change from Baseline in Respiratory Symptom Score at Month 15 | 16.63 points | 11.83 points | 4.80 points, p=0.0015** | ||||||||
| Time to Culture Conversion | Median: Month 2*** | Median: Month 3*** | Hazard ratio: 2.03, p<0.0001** | ||||||||
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* Statistically significant
** Nominal p-value not adjusted for multiplicity control
*** The second month of two consecutive negative cultures after applying adjustment rules as specified in the statistical analysis plan
The most common TEAEs occurring in 10% or more of patients in a treatment arm and higher in the ARIKAYCE arm compared to the active comparator arm were in line with expectations. Overall TEAEs were as follows:
ARIKAYCE 590 mg plus azithromycin 250 mg + ethambutol 15 mg/kg once-daily (N=213) | Placebo plus azithromycin 250 mg + ethambutol 15 mg/kg once-daily (N=212) | |||||||
| Any TEAE, n (%) | 209 (98.1) | 206 (97.2) | ||||||
| Severe TEAE, n (%) | 32 (15.0) | 22 (10.4) | ||||||
| Serious TEAE, n (%) | 30 (14.1) | 24 (11.3) | ||||||
| TEAE Leading to Death, n (%) | 1 (0.5) | 1 (0.5) | ||||||
| TEAE Leading to ARIKAYCE/Comparator Discontinuation, n (%) | 31 (14.6) | 18 (8.5) | ||||||
| TEAEs ≥10% and Higher in the ARIKAYCE Arm | ||||||||
| Dysphonia, n (%) | 125 (58.7) | 18 (8.5) | ||||||
| Cough, n (%) | 70 (32.9) | 31 (14.6) | ||||||
| Fatigue, n (%) | 37 (17.4) | 24 (11.3) | ||||||
| Dyspnea, n (%) | 35 (16.4) | 12 (5.7) | ||||||
| Nausea, n (%) | 33 (15.5) | 27 (12.7) | ||||||
| Headache, n (%) | 27 (12.7) | 25 (11.8) | ||||||
n = number of patients with at least one event | ||||||||
Among TEAEs of special interest, only bronchospasm (n=49, 23.0% vs n=25, 11.8%) and hypersensitivity pneumonitis (n=5, 2.3% vs n=0) occurred in notably more patients receiving ARIKAYCE than patients in the comparator arm. Comparable rates between treatment arms were observed for ototoxicity (n=55, 25.8% vs n=48, 22.6%), exacerbation of underlying pulmonary disease (n=23, 10.8% vs n=21, 9.9%), hemoptysis (n=22, 10.3% vs n=22, 10.4%), neuromuscular disorders (n=5, 2.3% vs n=6, 2.8%), and nephrotoxicity (n=1, 0.5% vs n=0). No death was considered related to ARIKAYCE or placebo. The treatment discontinuation rate was 18.3% in the ARIKAYCE arm and 11.8% in the comparator arm. Study completion rates were 90.6% in the ARIKAYCE arm and 93.4% in the comparator arm.
With these results, we have completed the study intended to fulfill the FDA post-marketing requirement. We plan to file an sNDA for ARIKAYCE in patients with MAC lung disease in the second half of 2026 to support potential label expansion and to obtain traditional approval for the existing refractory indication in the US. Additionally, we plan to submit the data to the PMDA in the second half of 2026 to support potential label expansion in Japan.
Regulatory Approval Outside of the US
In October 2020, the EC granted marketing authorization for ARIKAYCE for the treatment of NTM lung infections caused by MAC in adults with limited treatment options who do not have CF. ARIKAYCE can now be prescribed for patients across the EU countries as well as in the UK. ARIKAYCE is reimbursed nationally in France, Belgium, the Netherlands, the UK and Ireland. To date, we have been unable to reach an acceptable agreement of a nationally reimbursed price with the Italian Medicines Agency; however, ARIKAYCE remains commercially available for physicians to prescribe in Italy under Class C, where we set the price and funding is agreed locally.
In March 2021, Japan's MHLW approved ARIKAYCE for the treatment of patients with NTM lung disease caused by MAC who did not sufficiently respond to prior treatment with a multidrug regimen. In July 2021, we launched ARIKAYCE in Japan.
Further Research and Lifecycle Management
We are currently exploring and supporting research and lifecycle management programs for ARIKAYCE beyond treatment of refractory MAC lung disease as part of a combination antibacterial regimen for adult patients who have limited or no treatment options. As noted above, we have completed the post-marketing confirmatory MAC lung disease clinical trial program for ARIKAYCE, through the completed ARISE and ENCORE trials, which are intended to fulfill the FDA's post-
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marketing requirement to allow for the full approval of ARIKAYCE in the US, as well as to support the use of ARIKAYCE as a treatment for patients with MAC lung disease.
Treprostinil Palmitil Inhalation Powder
TPIP is an investigational inhaled dry powder formulation of treprostinil palmitil that has the potential to address certain of the current limitations of existing prostanoid therapies. We believe that TPIP prolongs duration of effect and may provide patients with greater consistency in pulmonary arterial pressure reduction over time. Current inhaled prostanoid therapies must be dosed four to nine times per day. Reducing dose frequency has the potential to ease treatment burden for patients and improve compliance. Additionally, we believe that TPIP may be associated with fewer side effects, including severity and/or frequency of cough, headache, throat irritation, nausea, flushing, and dizziness that are associated with high initial drug levels and local upper airway exposure when using current inhaled prostanoid therapies. We believe TPIP may offer a differentiated product profile for PH-ILD, PAH, PPF and IPF. In January 2026, the FDA granted an orphan drug designation for treprostinil palmitil for the treatment of PAH, based on a plausible hypothesis that it may be clinically superior to treprostinil already approved for the treatment of the same indication.
In February 2021, we announced topline results from the Phase 1 study of TPIP in healthy volunteers. The objective of this first-in-human single ascending dose and multiple ascending dose study was to assess the pharmacokinetics and tolerability profile of TPIP. Data from the study demonstrated that TPIP was generally well tolerated, with a pharmacokinetic profile that supports continued development with once-daily dosing. The most common AEs across all cohorts in the study were cough, dizziness, headache, and nausea. Most AEs were mild in severity and consistent in nature with those typically seen with other inhaled prostanoid therapies. There were few moderate AEs and no severe or serious AEs. Subjects in the multiple dose panel that incorporated an up-titration approach beginning at 112.5 µg once-daily and progressing to 225 µg once-daily reported fewer AEs compared to the panel dosed with 225 µg once-daily from the first dose.
Overall pharmacokinetic results demonstrated that treprostinil exposure (AUC and Cmax) was dose-proportional, with low to moderate inter-subject variability. Treprostinil was detected in the plasma at 24 hours at all doses and throughout the 48-hour sampling period for the two highest doses. Compared with currently available inhaled treprostinil therapy, TPIP showed substantially lower Cmax and longer half-life.
In May 2024, we reported positive topline safety data and certain exploratory efficacy endpoints from the Phase 2a study of TPIP in patients with PH-ILD. A total of 39 patients were randomized 3:1 to receive either TPIP (n=29) or placebo (n=10) for 16 weeks. Patients started at a dose of 80 µg once-daily (TPIP or matching placebo) and were titrated up to their maximum tolerated dose, or to the maximum allowable dose of 640 µg, once daily over a three-week period, with the possibility of a final dose increase occurring at Week 5. Of the patients treated with TPIP, 79.3% of patients were able to reach the maximum 640 µg dose by Week 5, compared to 100.0% of patients in the placebo arm. TEAEs which led to treatment discontinuation were reported in 13.8% of patients in the active treatment arm and 30.0% of patients in the placebo arm. Adverse events related to study drug were reported in 55.2% of TPIP patients and 40.0% of placebo patients. Serious adverse events were reported in 20.7% of TPIP-treated patients and 40.0% of placebo-treated patients. Deaths were reported in 6.9% of patients taking TPIP and 20.0% of patients taking placebo. All deaths were attributed to disease progression or comorbid causes, none of which were deemed related to study drug.
There were no meaningful changes in oxygenation levels compared to baseline for TPIP-treated patients at rest or at the lowest point during or after exercise. There was also no change in the use of supplemental oxygen for patients taking TPIP. There was a small decrease in oxygenation levels observed after exercise for patients on TPIP, compared to a slight increase for patients taking placebo.
On the exploratory endpoint of change from baseline in 6-minute walk distance (6MWD), TPIP-treated patients demonstrated a 30-meter improvement compared to patients treated with placebo. However, this result was associated with a wide confidence interval. In addition, there was a directional improvement observed in N-terminal pro b-type natriuretic peptide (NT-proBNP) levels from baseline for patients taking TPIP and a directional worsening observed in patients on placebo, although no meaningful separation was observed between groups. Events of clinical worsening were reported in 10.3% of patients taking TPIP, compared to 50.0% of patients taking placebo. This difference was nominally significant (p=0.0164).
We initiated PALM-ILD, a Phase 3 study of patients with PH-ILD, in the fourth quarter of 2025 and are actively enrolling patients.
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In June 2025, we announced positive topline results from the Phase 2b study of TPIP in patients with PAH. The study met its primary endpoint and secondary efficacy endpoints. For the primary endpoint, the placebo-adjusted reduction from baseline in pulmonary vascular resistance (PVR) was 35% with Least Squares (LS) mean ratio of 0.65 (95% Confidence Interval (CI): 0.54, 0.79; p<0.001). For the secondary efficacy endpoints, the placebo-adjusted improvement in 6MWD was 35.5 meters (95% CI: 11.2, 60.7; p=0.003) and the placebo-adjusted reduction from baseline in NT-proBNP concentrations, a biomarker for cardiac stress, was 60% with LS mean ratio of 0.40 (95% CI: 0.27, 0.59; p<0.001). Efficacy of TPIP was evaluated approximately 24 hours after therapy was administered.
The TPIP PAH study was conducted at 44 sites globally, and a total of 102 patients were randomized 2:1 to receive either TPIP (n=69) or placebo (n=33) for 16 weeks. Demographics and baseline characteristics were similar in both study arms. Patients started at a dose of 80 µg once daily (TPIP or matching placebo) and were titrated up to their maximum tolerated dose, or to the maximum allowable dose of 640 µg, once daily over a three-week period, with the possibility of a final dose increase occurring at Week 5. Of the patients treated with TPIP, 84% titrated to at least 480 µg once daily (n=58) and 75% titrated to the maximum allowed dose of 640 µg once daily (n=52). Overall, 90% of patients receiving TPIP (n=62) and all patients receiving placebo completed the study.
Once-daily TPIP therapy was well-tolerated in the study. TEAEs occurred in 88.4% of patients who received TPIP versus 75.8% of patients who received placebo; serious TEAEs were observed in 7.2% of patients who received TPIP versus 3.0% of patients who received placebo; and severe TEAEs were observed in 5.8% of patients who received TPIP versus 3.0% of patients who received placebo. TEAEs leading to treatment discontinuation were experienced by 5.8% of patients taking TPIP; there were none in the placebo arm. There were no deaths in the study. The most common TEAEs occurring in at least 5.0% of patients in any study arm, and more frequently with TPIP than with placebo, were cough (40.6%, 21.2%), headache (31.9%, 15.2%), fatigue (10.1%, 3.0%), chest discomfort (8.7%, 0.0%), flushing (8.7%, 3.0%), upper respiratory tract infection (7.2%, 3.0%), and non-cardiac chest pain (5.8%, 3.0%) for TPIP and placebo, respectively.
In April 2026, we initiated a Phase 3 study of TPIP in patients with PAH.
All patients who completed the Phase 2b study were eligible to enroll in the long-term OLE, which will evaluate TPIP up to a maximum allowable dose of 1,280 µg once daily. Of the patients who completed the Phase 2b study (n=95), 95% enrolled in the OLE. We expect to report data from the OLE of our Phase 2b study of TPIP in PAH in the third quarter of 2026.
We anticipate initiating a Phase 3 study of TPIP in patients with PPF in the second half of 2026 and a Phase 3 study in patients with IPF in the first half of 2027.
INS1148
INS1148 is an investigational monoclonal antibody that we are developing as a potential first-in-class therapy to address respiratory and immunological and inflammatory diseases with high unmet need. Through its novel mechanism of action, INS1148 preferentially targets SCF248. Binding to SCF248 induces clearance of this SCF isoform and interrupts only the inflammatory cascade downstream of c-Kit signaling, while leaving the homeostatic and tissue healing c-Kit pathways intact. We plan to advance a Phase 2 development program for INS1148 initially in PPF and IPF.
Immunology & Inflammation
Brensocatib
In April 2026, we completed the Phase 2b CEDAR study of brensocatib in patients with hidradenitis suppurativa (HS). The study did not meet its primary or secondary efficacy endpoints and we have discontinued our development program for brensocatib in HS.
Neuro & Other Rare
INS1201
INS1201 is a micro-dystrophin adeno-associated virus gene therapy for patients with DMD. Administered intrathecally, this approach has the potential to target both skeletal and cardiac muscles at lower doses than intravenous DMD gene therapies. The FDA granted INS1201 orphan drug designation in August 2025 for the treatment of DMD. The FDA granted INS1201 Rare Pediatric Disease Designation in August 2024. We have initiated a Phase 1 study of INS1201, which we refer to as the ASCEND trial, and continue to enroll patients.
INS1202
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INS1202 is an investigational adeno-associated virus (AAV9) short hairpin RNA (shRNA) construct targeting the human superoxide dismutase type 1 (SOD1) gene. We are developing INS1202 as a potential treatment for patients with ALS who carry the SOD1 genetic mutations and those who do not have any genetic mutations. INS1202 is administered intrathecally as a one-time fixed (non-weight-based) dose. We have initiated a Phase 1 study of INS1202, which we refer to as the ARMOR trial, and continue to enroll patients.
Corporate Development
We plan to continue to develop, acquire, in-license, or co-promote other commercial products, product candidates, and technologies, including those that address serious diseases that currently have significant unmet needs. We are focused broadly on serious disease therapeutics and prioritizing those within our three therapeutic areas.
KEY COMPONENTS OF OUR RESULTS OF OPERATIONS
Product Revenues, Net
Product revenues, net, consist of net sales of ARIKAYCE and BRINSUPRI. We recognize revenue for product received by our customers net of allowances for customer credits, including prompt pay discounts, service fees, estimated rebates, including government rebates, such as Medicaid rebates and Medicare Part D reimbursements in the US, and chargebacks.
Cost of Product Revenues (Excluding Amortization of Intangible Assets)
Cost of product revenues (excluding amortization of intangible assets) consist primarily of direct and indirect costs related to the manufacturing of ARIKAYCE and BRINSUPRI sold, including third-party manufacturing costs, packaging services, freight, and allocation of overhead costs, in addition to royalty expenses.
Research and Development Expenses
R&D expenses consist of salaries, benefits and other related costs, including stock-based compensation, for personnel serving in our research and development functions. R&D expenses also include other internal operating expenses, the cost of manufacturing product candidates, including the medical devices for drug delivery, for clinical study, the cost of conducting clinical studies, and the cost of conducting pre-clinical and research activities. In addition, R&D expenses include payments to third parties for the license rights to products in development (prior to marketing approval), and may include the cost of asset acquisitions. Our R&D expenses related to manufacturing our product candidates and medical devices for clinical study are primarily related to activities at CMOs that manufacture our product candidates and early-stage research activities. Our R&D expenses related to clinical trials are primarily related to activities at contract research organizations (CROs) that conduct and manage clinical trials on our behalf. These contracts with CROs set forth the scope of work to be completed at a fixed fee or billed at a per-unit cost, and increase proportionally to the volume of services rendered. Payments under these contracts with CROs primarily depend on performance criteria such as the successful enrollment of patients or the completion of clinical trial milestones as well as time-based fees. Expenses are accrued based on contracted amounts applied to the level of patient enrollment and to activity according to the clinical trial protocol. Deposits for goods or services that will be used or rendered for future research and development activities are deferred and capitalized. Such amounts are then recognized as an expense as the related goods are delivered or the services are performed.
Selling, General and Administrative (SG&A) Expenses
SG&A expenses consist of salaries, benefits and other related costs, including stock-based compensation, for our non-employee directors and personnel serving in our executive, finance and accounting, legal and compliance, commercial and pre-commercial, corporate development, field sales, information technology and human resource functions. SG&A expenses also include professional fees for legal services, consulting services, including commercial activities, insurance, board of director fees, tax and accounting services.
Amortization of Intangible Assets
Upon commercialization of each of ARIKAYCE and BRINSUPRI, the related intangible assets began to be amortized over their estimated useful lives. The fair values assigned to our intangible assets are based on estimates and assumptions we believe are reasonable based on available facts and circumstances. Unanticipated events or circumstances may occur that require us to review the assets for impairment.
Change in Fair Value of Contingent Consideration
In connection with the Business Acquisition, we recorded contingent consideration liabilities related to potential future milestone payments. Adjustments to the fair value are due to changes in the probability of achieving milestones, our stock price,
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or certain other estimated assumptions. The change in fair value of contingent consideration is calculated quarterly with gains and losses recorded in the consolidated statements of comprehensive loss.
Investment Income and Interest Expense
Investment income consists of interest and dividend income earned on our cash and cash equivalents and marketable securities. Interest expense consists primarily of contractual interest costs, Royalty Financing Agreement non-cash interest expense and the amortization of debt issuance costs related to our debt. Debt issuance costs were amortized to interest expense using the effective interest rate method over the term of the debt. Our consolidated balance sheets reflect debt, net of the debt issuance costs paid to the lender, and other third-party costs.
RESULTS OF OPERATIONS
Comparison of the Three Months Ended March 31, 2026 and 2025
Product Revenues, Net
Product revenues, net, consists of net sales of ARIKAYCE and BRINSUPRI. The following table summarizes revenue by product and geography for the three months ended March 31, 2026 and 2025 (in thousands):
| Three Months Ended March 31, | Increase (decrease) | ||||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| ARIKAYCE | |||||||||||||||||||||||
| US | $ | 62,884 | $ | 64,275 | $ | (1,391) | (2.2) | % | |||||||||||||||
| International | 35,226 | 28,548 | 6,678 | 23.4 | % | ||||||||||||||||||
| Total | $ | 98,110 | $ | 92,823 | $ | 5,287 | 5.7 | % | |||||||||||||||
| BRINSUPRI | |||||||||||||||||||||||
| US | $ | 207,182 | $ | — | $ | 207,182 | NA | ||||||||||||||||
| International | 672 | — | 672 | NA | |||||||||||||||||||
| Total | $ | 207,854 | $ | — | $ | 207,854 | NA | ||||||||||||||||
| Total | |||||||||||||||||||||||
| US | $ | 270,066 | $ | 64,275 | $ | 205,791 | 320.2 | % | |||||||||||||||
| International | 35,898 | 28,548 | 7,350 | 25.7 | % | ||||||||||||||||||
| Total product revenues, net | $ | 305,964 | $ | 92,823 | $ | 213,141 | 229.6 | % | |||||||||||||||
Product revenues, net, for the three months ended March 31, 2026 were $306.0 million as compared to $92.8 million for the same period in 2025, an increase of $213.1 million, or 229.6%. This increase was a result of $207.2 million of US commercial sales of BRINSUPRI following approval in August 2025 and a 5.7% growth in sales of ARIKAYCE, driven by growth in international sales of 23.4%. In the first quarter of 2026, we began recognizing international BRINSUPRI revenue related to EAPs in Europe, consisting of sales to the French National Agency for Medicines and Health Products Safety, which has granted BRINSUPRI a Compassionate Access Authorisation (Autorisation d'accès compassionnel or AAC) and sales through the NPP in other countries.
Cost of Product Revenues (excluding amortization of intangible assets)
Cost of product revenues (excluding amortization of intangible assets) for the three months ended March 31, 2026 and 2025 were comprised of the following (in thousands):
| Three Months Ended March 31, | Increase (decrease) | ||||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Cost of product revenues (excluding amortization of intangible assets) | $ | 47,420 | $ | 21,278 | $ | 26,142 | 122.9 | % | |||||||||||||||
| Cost of product revenues, as % of revenues | 15.5 | % | 22.9 | % | |||||||||||||||||||
Cost of product revenues (excluding amortization of intangible assets) were $47.4 million for the three months ended March 31, 2026 as compared to $21.3 million for the same period in 2025, an increase of $26.1 million, or 122.9%. This increase was primarily attributable to the increase in total product revenues discussed above. Cost of product revenues as a percent of revenues decreased in the current period due to sales of BRINSUPRI, which has lower manufacturing costs than ARIKAYCE.
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All product costs for BRINSUPRI incurred prior to FDA approval on August 12, 2025 were expensed as R&D expenses. We expect our cost of product revenues (excluding amortization of intangible assets) to benefit 2026 and beyond, as we sell through inventory that was expensed prior to FDA approval of BRINSUPRI.
R&D Expenses
R&D expenses for the three months ended March 31, 2026 and 2025 were comprised of the following (in thousands):
| Three Months Ended March 31, | Increase (decrease) | ||||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| External Expenses | |||||||||||||||||||||||
| Clinical development and research | $ | 47,956 | $ | 40,537 | $ | 7,419 | 18.3 | % | |||||||||||||||
| Manufacturing | 38,136 | 21,809 | 16,327 | 74.9 | % | ||||||||||||||||||
| Regulatory, quality assurance, and medical affairs | 11,033 | 7,672 | 3,361 | 43.8 | % | ||||||||||||||||||
| Subtotal—external expenses | $ | 97,125 | $ | 70,018 | $ | 27,107 | 38.7 | % | |||||||||||||||
| Internal Expenses | |||||||||||||||||||||||
| Compensation and benefit-related expenses | $ | 72,140 | $ | 53,558 | $ | 18,582 | 34.7 | % | |||||||||||||||
| Stock-based compensation | 23,994 | 17,380 | 6,614 | 38.1 | % | ||||||||||||||||||
| Other internal operating expenses | 16,226 | 11,621 | 4,605 | 39.6 | % | ||||||||||||||||||
| Subtotal—internal expenses | $ | 112,360 | $ | 82,559 | $ | 29,801 | 36.1 | % | |||||||||||||||
| Total R&D expenses | $ | 209,485 | $ | 152,577 | $ | 56,908 | 37.3 | % | |||||||||||||||
R&D expenses were $209.5 million for the three months ended March 31, 2026 as compared to $152.6 million for the same period in 2025, an increase of $56.9 million, or 37.3%. This increase was primarily due to a $25.2 million increase in compensation and benefit-related expenses and stock-based compensation costs due to an increase in headcount, a $16.3 million increase in manufacturing costs, and a $7.4 million increase in clinical development and research costs.
External R&D expenses by product for the three months ended March 31, 2026 and 2025 were comprised of the following (in thousands):
| Three Months Ended March 31, | Increase (decrease) | |||||||||||||||||||||||||
| 2026 | 2025 | $ | % | |||||||||||||||||||||||
| ARIKAYCE external R&D expenses | $ | 8,622 | $ | 12,121 | $ | (3,499) | (28.9) | % | ||||||||||||||||||
| Brensocatib external R&D expenses | 18,484 | 20,661 | (2,177) | (10.5) | % | |||||||||||||||||||||
| TPIP external R&D expenses | 37,341 | 9,153 | 28,188 | 308.0 | % | |||||||||||||||||||||
| Other external R&D expenses | 32,678 | 28,083 | 4,595 | 16.4 | % | |||||||||||||||||||||
| Total external R&D expenses | $ | 97,125 | $ | 70,018 | $ | 27,107 | 38.7 | % | ||||||||||||||||||
SG&A Expenses
SG&A expenses for the three months ended March 31, 2026 and 2025 were comprised of the following (in thousands):
| Three Months Ended March 31, | Increase (decrease) | ||||||||||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||||||||
| Compensation and benefit-related expenses | $ | 74,793 | $ | 54,836 | $ | 19,957 | 36.4 | % | |||||||||||||||||||||
| Stock-based compensation | 21,760 | 21,882 | (122) | (0.6) | % | ||||||||||||||||||||||||
| Professional fees and other external expenses | 124,964 | 50,561 | 74,403 | 147.2 | % | ||||||||||||||||||||||||
| Facility related and other internal expenses | 25,742 | 20,266 | 5,476 | 27.0 | % | ||||||||||||||||||||||||
| Total SG&A expenses | $ | 247,259 | $ | 147,545 | $ | 99,714 | 67.6 | % | |||||||||||||||||||||
SG&A expenses were $247.3 million for the three months ended March 31, 2026 as compared to $147.5 million for the same period in 2025, an increase of $99.7 million, or 67.6%. This increase was primarily due to a $74.4 million increase in professional fees and other external expenses and a $19.8 million increase in compensation and benefit-related expenses and stock-based compensation costs due to an increase in headcount, both driven by commercial activities for BRINSUPRI.
37
Amortization of Intangible Assets
Amortization of intangible assets was $2.1 million for the three months ended March 31, 2026 as compared to $1.3 million for the same period in 2025, an increase of $0.8 million. This increase was due to amortization of the AstraZeneca milestones achieved upon FDA and EC approvals of BRINSUPRI in August 2025 and November 2025, respectively.
Change in Fair Value of Contingent Consideration
The change in fair value of contingent consideration for the three months ended March 31, 2026 was $47.0 million and was primarily due to the decrease in our share price and change in probabilities of success, partially offset by an increase in the obligation associated with the reauthorization of the PRV program. The change is related to the fair value of the potential future consideration to be paid to former equityholders of the businesses we acquired.
Investment Income
Investment income was $12.0 million for the three months ended March 31, 2026 as compared to $13.9 million for the same period in 2025, a decrease of $1.9 million, or 13.4%. This decrease was primarily due to lower interest rates in 2026 relative to the same period in 2025.
Interest Expense
Interest expense for the three months ended March 31, 2026 was $20.1 million as compared to $21.6 million for the same period in 2025, a decrease of $1.5 million, or 6.9%. This decrease was primarily due to the redemption of the Company's outstanding 0.75% Convertible Senior Notes due 2028 in the second quarter of 2025. See Note 10 - Debt and Note 11 - Royalty Financing Agreement in this Quarterly Report on Form 10-Q for further details.
LIQUIDITY AND CAPITAL RESOURCES
Overview
There is considerable time and cost associated with developing potential pharmaceutical products to the point of regulatory approval and commercialization. We commenced commercial shipments of ARIKAYCE in October 2018 and BRINSUPRI in August 2025. We expect to continue to incur consolidated operating losses, including losses at our US and certain international entities, as we plan to fund R&D for ARIKAYCE, TPIP, INS1148, INS1201, INS1202, and our other pipeline programs, continue commercialization and regulatory activities for ARIKAYCE and BRINSUPRI, and engage in other general and administrative activities.
In June 2025, we completed an underwritten offering of 8,984,375 shares of our common stock at a public offering price of $96.00 per share. 1,171,875 of the shares of common stock were issued pursuant to the exercise in full of the underwriters' option to purchase additional shares. Our net proceeds from the sale of the shares, after deducting the underwriting discounts and offering expenses of $39.2 million, were $823.3 million.
Based on our current operating plan we anticipate that our cash and cash equivalents and marketable securities as of March 31, 2026 will enable us to fund our operations. While we believe we currently have sufficient funds to meet our financial needs for at least the next 12 months, we may raise additional capital to fund future development of our product candidates, and to develop, acquire, in-license or co-promote other products or product candidates, including those that address serious diseases with significant unmet need. Our cash requirements for the next 12 months will be impacted by a number of factors, the most significant of which we expect to be expenses related to our commercialization efforts for ARIKAYCE and BRINSUPRI and development costs for our clinical-stage assets and, to a lesser extent, our pre-clinical research programs.
Cash Flows
As of March 31, 2026, we had cash and cash equivalents of $582.2 million, as compared to $510.4 million as of December 31, 2025. In addition, as of March 31, 2026, we had marketable securities of $641.3 million, as compared to $919.6 million as of December 31, 2025. The net decrease in cash and cash equivalents and marketable securities was primarily due to the cash used in operating activities and the $15.0 million milestone payment to AstraZeneca following EC approval of BRINSUPRI, partially offset by proceeds from the exercise of stock options. Our working capital was $1.3 billion as of both March 31, 2026 and December 31, 2025.
Net cash used in operating activities was $222.7 million and $262.1 million for the three months ended March 31, 2026 and 2025, respectively. The net cash used in operating activities during the three months ended March 31, 2026 and 2025 was primarily driven by commercial, clinical, and manufacturing activities related to ARIKAYCE, commercial and commercial readiness activities for BRINSUPRI, as well as other SG&A expenses, and clinical trial expenses related to brensocatib and TPIP. The decrease in cash used in operating activities for the three months ended March 31, 2026 as compared to the same period in 2025 was primarily due to the decrease in net loss, excluding the adjustments to reconcile net loss to net cash used in operating activities.
38
Net cash provided by investing activities was $265.5 million and $80.4 million for the three months ended March 31, 2026 and 2025, respectively. During the three months ended March 31, 2026, net cash provided by investing activities consisted primarily of maturities of marketable securities, partially offset by the $15.0 million milestone payment to AstraZeneca following EC approval of BRINSUPRI. During the three months ended March 31, 2025, net cash provided by investing activities consisted primarily of maturities of marketable securities, partially offset by purchases of marketable securities.
Net cash provided by financing activities was $29.5 million and $29.0 million for the three months ended March 31, 2026 and 2025, respectively. During the three months ended March 31, 2026 and 2025, net cash provided by financing activities consisted primarily of proceeds from the exercise of stock options.
Contractual Obligations
There were no material changes outside of the ordinary course of business in our contractual obligations during the three months ended March 31, 2026 from those disclosed in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Contractual Obligations” in our Annual Report on Form 10-K for the year ended December 31, 2025.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. We do not have any interest in special purpose entities, structured finance entities or other variable interest entities.
CRITICAL ACCOUNTING ESTIMATES
There have been no material changes to our critical accounting policies and estimates as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025. For the required interim disclosure updates related to our accounting policies and estimates, see Note 2 - Summary of Significant Accounting Policies in this Quarterly Report on Form 10-Q.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
As of March 31, 2026, our cash and cash equivalents were in cash accounts and money market funds. Our investments in money market funds are not insured by the federal government. As of March 31, 2026, we had $641.3 million in marketable securities.
As of March 31, 2026, we had our $500.0 million Term Loans outstanding. The Term Loans accrue interest quarterly at a fixed rate of 9.6% per annum. If a 10% change in interest rates had occurred on March 31, 2026, it would not have had a material effect on the fair value of our debt as of that date, nor would it have a material effect on our future earnings or cash flows.
The majority of our business is conducted in US dollars. However, we do conduct certain transactions in other currencies, including Euros, British Pounds, Swiss Francs and Japanese Yen. Historically, fluctuations in foreign currency exchange rates have not materially affected our results of operations. During the three months ended March 31, 2026 and 2025, our results of operations were not materially affected by fluctuations in foreign currency exchange rates.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of March 31, 2026. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended (the Exchange Act), means controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit with the SEC is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and to ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. Based on that evaluation as of March 31, 2026, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective at the reasonable assurance level.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended March 31, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II. OTHER INFORMATION
39
ITEM 1. LEGAL PROCEEDINGS
From time to time, we are party to various lawsuits, claims and other legal proceedings that arise in the ordinary course of our business. While the outcomes of these matters are uncertain, management does not expect that the ultimate costs to resolve these matters will have a material adverse effect on our consolidated financial position, results of operations or cash flows.
ITEM 1A. RISK FACTORS
Our business is subject to substantial risks and uncertainties. You should carefully consider the information contained in this Quarterly Report on Form 10-Q, the risks and uncertainties below, and the risk factors and other information contained in our other public filings in evaluating our business, including our Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the SEC on February 19, 2026. Any of the risks and uncertainties described herein and in our other filings with the SEC, either alone or taken together, could materially and adversely affect our business, financial condition, results of operations, prospects for growth, and the value of an investment in our common stock. In addition, these risks and uncertainties could cause actual results to differ materially from those expressed or implied by forward-looking statements contained in this Form 10-Q (please read "Cautionary Note Regarding Forward-Looking Statements" in this Quarterly Report on Form 10-Q).
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
ITEM 5. OTHER INFORMATION
Rule 10b5-1 Trading Plans
Our policy governing transactions in our securities by our directors, officers and employees permits our directors, officers and employees to enter into trading plans complying with Rule 10b5-1 under the Exchange Act. The following table describes the written plans for the sale of our securities adopted , modified or terminated
| Name and Title | Date of Adoption of Trading Plan | Scheduled Start Date of Trading Plan | Scheduled Expiration Date of Trading Plan (1) | Maximum Shares Subject to Trading Plan | Date Plan Terminated | |||||||||||||||||||||||||||
| Sara Bonstein Chief Financial Officer | 06/02/2026 | NA | ||||||||||||||||||||||||||||||
| Martina Flammer, M.D. Chief Medical Officer | 09/01/2026 | NA | ||||||||||||||||||||||||||||||
(1) A Trading Plan may expire on an earlier date if all contemplated transactions are completed before such Trading Plan’s expiration date, upon termination by broker or the holder of the Trading Plan, or as otherwise provided in the Trading Plan.
In addition, during the period covered by this Quarterly Report on Form 10-Q, each of our officers entered into grant agreements relating to RSUs and PSUs that included “sell-to-cover” arrangements constituting “non-Rule 10b5-1 trading arrangements” (as defined in Item 408 of Regulation S-K), requiring the pre-arranged sale of shares upon vesting to satisfy tax withholding obligations arising solely from such vesting of the RSUs and the PSUs and the related issuance of shares. The amount of shares to be sold to satisfy the tax withholding obligations under these arrangements is dependent on the trading price of the Company’s common stock at the time of the vesting of the RSUs and the PSUs. The duration of each of these arrangements is until the final vesting date of the applicable RSUs or PSUs or the earlier forfeiture of unvested RSUs or PSUs as set forth in the applicable grant agreement.
40
ITEM 6. EXHIBITS
Exhibit Index
| Articles of Incorporation of Insmed Incorporated, as amended through June 14, 2012 (incorporated by reference from Exhibit 3.1 to Insmed Incorporated’s Annual Report on Form 10-K filed on March 18, 2013). | ||||||||
| Amended and Restated Bylaws of Insmed Incorporated (effective as of May 11, 2023) (incorporated by reference from Exhibit 3.1 to Insmed Incorporated’s Current Report on Form 8-K filed on May 11, 2023). | ||||||||
| Certification of William H. Lewis, Chair and Chief Executive Officer (Principal Executive Officer) of Insmed Incorporated, pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes Oxley Act of 2002 (filed herewith). | ||||||||
| Certification of Sara Bonstein, Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) of Insmed Incorporated, pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes Oxley Act of 2002 (filed herewith). | ||||||||
| Certification of William H. Lewis, Chair and Chief Executive Officer (Principal Executive Officer) of Insmed Incorporated, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 (furnished herewith). | ||||||||
| Certification of Sara Bonstein, Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) of Insmed Incorporated, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 (furnished herewith). | ||||||||
| 101 | The following materials from Insmed Incorporated’s quarterly report on Form 10-Q for the quarter ended March 31, 2026 formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025, (ii) Consolidated Statements of Comprehensive Loss for the three months ended March 31, 2026 and 2025, (iii) Consolidated Statements of Shareholders' Equity for the three months ended March 31, 2026 and 2025, (iv) Consolidated Statements of Cash Flows for the three months ended March 31, 2026 and 2025, (v) Notes to the Unaudited Consolidated Financial Statements, and (vi) Cover Page. | |||||||
| 104 | The cover page from the Quarterly Report on Form 10-Q for the quarter ended March 31, 2026, formatted in iXBRL and contained in Exhibit 101. | |||||||
41
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| INSMED INCORPORATED | ||||||||
Date: May 7, 2026 | By | /s/ Sara Bonstein | ||||||
| Sara Bonstein | ||||||||
| Chief Financial Officer | ||||||||
| (Principal Financial and Accounting Officer) | ||||||||
42
EXHIBIT 31.1
Section 302 Certification
I, William H. Lewis, Chief Executive Officer of Insmed Incorporated, certify that:
(1) I have reviewed this quarterly report on Form 10-Q of Insmed Incorporated;
(2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
(3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
(4) The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
(5) The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 7, 2026
| /s/ William H. Lewis | ||
| William H. Lewis | ||
| Chair and Chief Executive Officer | ||
| (Principal Executive Officer) | ||
EXHIBIT 31.2
Section 302 Certification
I, Sara Bonstein, Chief Financial Officer of Insmed Incorporated, certify that:
(1) I have reviewed this quarterly report on Form 10-Q of Insmed Incorporated;
(2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
(3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
(4) The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
(5) The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: May 7, 2026
| /s/ Sara Bonstein | ||
| Sara Bonstein | ||
| Chief Financial Officer | ||
| (Principal Financial and Accounting Officer) | ||
EXHIBIT 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2003
In connection with this Quarterly Report on Form 10-Q of Insmed Incorporated (the "Company") for the period ended March 31, 2026 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, William H. Lewis, Chief Executive Officer of the Company, certify, pursuant to 18 USC. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2003, that:
(1)the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| /s/ William H. Lewis | ||
| William H. Lewis | ||
| Chair and Chief Executive Officer | ||
| (Principal Executive Officer) | ||
May 7, 2026
This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Insmed Incorporated under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.
EXHIBIT 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2003
In connection with this Quarterly Report on Form 10-Q of Insmed Incorporated (the "Company") for the period ended March 31, 2026 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Sara Bonstein, Chief Financial Officer of the Company, certify, pursuant to 18 USC. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2003, that:
(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| /s/ Sara Bonstein | ||
| Sara Bonstein | ||
| Chief Financial Officer | ||
| (Principal Financial and Accounting Officer) | ||
May 7, 2026
This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Insmed Incorporated under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.