Avalyn Pharma Inc.

The Company has determined that its existing cash, cash equivalents, and marketable securities will be sufficient to fund the Company s operating expenses and capital expenditures requirements for at least 12 months from the issuance date of these consolidated financial statements.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

Deferred Offering Costs The Company capitalizes certain legal, professional accounting, and other third-party fees that are incremental costs and directly associated with in-process equity and debt financings as deferred offering costs within non-current assets on the consolidated balance sheets until such time the equity and debt financings are consummated.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

Treasury securities $ 28,379 $ ( 14 ) $ $ 28,365 Commercial paper 38,660 ( 37 ) 38,623 Corporate debt securities 17,749 ( 10 ) 17,739 U.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

government agency debt securities 3,505 ( 4 ) 3,501 Marketable securities, long-term: U.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

Treasury securities 46,485 ( 29 ) 46,456 Corporate debt securities 14,648 ( 1 ) 14,647 Total marketable securities $ 149,426 $ ( 95 ) $ $ 149,331 December 31, 2025 Amortized Cost Unrealized Gain Unrealized Loss Fair Value Marketable securities, current: U.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

Treasury securities $ 30,049 $ 75 $ $ 30,124 Commercial paper 30,699 26 30,725 Corporate debt securities 25,162 33 25,195 Total marketable securities $ 85,910 $ 134 $ $ 86,044 As of June 30, 2026 , all marketable securities held by the Company had remaining contractual maturities of one year or less, except for U.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

We are proud of the progress we have made and believe our approach has the potential to drive sustained pipeline expansion and position Avalyn as a leader in transforming the treatment of rare respiratory diseases.

SEC original ↗Avalyn Pharma Inc. — Earnings release (8-K exhibit)EX-99Aug 12, 2026

All statements other than statements of historical facts contained in this Quarterly Report, including statements regarding our future results of operations and financial position, business strategy, product candidates, planned preclinical studies and clinical trials, results of preclinical studies, clinical trials, research and development costs, regulatory approvals, commercial strategy, timing and likelihood of success, as well as plans and objectives of management for future operations, are forward-looking statements.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

Segment Information The Company operates and manages its business as one operating segment and one reportable segment, which is focused on developing targeted therapies to treat rare lung diseases.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

In connection with the LSA, the Company granted the Lender a senior security interest in the Company s property and other assets, which has priority over any existing or future indebtedness and related security interests, subject to limited exceptions, including the Company s intellectual property.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

Pulmonary fibrosis is a devastating disease with few effective medications, and too many patients remain untreated due to the tolerability challenges associated with currently available options.

SEC original ↗Avalyn Pharma Inc. — Earnings release (8-K exhibit)EX-99Aug 12, 2026

These and other risks and uncertainties are described in greater detail in the section entitled “Risk Factors” in Avalyn’s current and future filings with the Securities and Exchange Commission, including those described from time to time under the caption “Risk Factors.

SEC original ↗Avalyn Pharma Inc. — Earnings release (8-K exhibit)EX-99Aug 12, 2026

Legal Proceedings 33 Item 1A.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

These statements involve known and unknown risks, uncertainties, and other important factors that are in some cases beyond our control and may cause our actual results, performance or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

These forward-looking statements speak only as of the date of this Quarterly Report and are subject to a number of risks, uncertainties and assumptions described in Risk Factors and elsewhere in this Quarterly Report.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026

Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events.

SEC original ↗Avalyn Pharma Inc. — 10-Q Quarterly report10-QAug 12, 2026