Capricor Therapeutics — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenue was $0 for the three and nine months ended September 30, 2026, and 2025.
• Total operating expenses were $44.7 million for Q3 2026, up from $26.3 million in Q3 2025; for the first nine months of 2026, expenses were $124.4 million compared to $79.0 million in the same period of 2025.
• Net loss was $42.7 million ($0.73 per share) for Q3 2026, compared to $24.6 million ($0.54 per share) for Q3 2025; for the first nine months of 2026, net loss was $117.3 million ($2.03 per share) versus $74.9 million ($1.64 per share) in 2025.
• Cash, cash equivalents, restricted cash, and marketable securities totaled approximately $198.5 million as of September 30, 2026, down from $318.1 million as of December 31, 2025.
• No shares were sold under the at-the-market (ATM) program from January 1, 2026, through November 10, 2026.
• Total liabilities increased to $120.6 million as of September 30, 2026, from $50.2 million as of December 31, 2025.

Guidance and Future Outlook:

• The company believes its current cash and marketable securities are sufficient to fund operating capital requirements for at least the next twelve months.
• Additional long-term financial guidance will be provided following greater regulatory clarity to inform future strategic and capital allocation decisions.
• The financial outlook excludes potential revenue from product sales, Priority Review Voucher monetization, and other non-operating capital sources.

Business Segments and Product Lines:

• The Deramiocel Biologics License Application (BLA) for Duchenne muscular dystrophy (DMD) is under FDA review with a PDUFA target action date of November 22, 2026.
• A major BLA amendment submitted in August included two-year open-label extension (OLE) HOPE-3 data and proposed a refined indication for upper limb impairment in patients over 9 years old.
• Two-year HOPE-3 OLE data presented at the World Muscle Society Congress showed a 76% slowing of upper limb decline in patients who switched from placebo to Deramiocel.
• HOPE-3 cardiac results received the American Heart Association Outstanding Research Award in Pediatric Cardiology, showing slower myocardial fibrosis progression and favorable left ventricular ejection fraction in patients with cardiomyopathy.
• The San Diego GMP facility is operational and positioned to support an initial commercial launch if approved; a second-floor cleanroom expansion is underway with validation targeted for the first half of 2027.
• Regulatory engagement has initiated in Europe and Japan for Deramiocel.
• Programs not directly related to Deramiocel, including the exosome-based platform, have been slowed to prioritize Deramiocel pending U.S. regulatory outcomes.
• Expansion into younger DMD patients and Becker muscular dystrophy remains a focus, contingent on the U.S. regulatory outcome.

Market and Competitive Landscape:

• The FDA classified the BLA amendment as a major submission, extending the review period by three months.
• The FDA conducted a Bioresearch Monitoring (BIMO) inspection in July 2026, issuing a Form 483 with one observation; the company has submitted its response and is awaiting feedback.
• The company is encouraged by the FDA's current focus on rare diseases, including the recently launched Rare Disease Framework Initiative.

Risks and Challenges:

• The company is pursuing a contractual dispute with Nippon Shinyaku and NS Pharma regarding the Deramiocel distribution agreement; the arbitration hearing is expected to commence in mid-2027.
• The company implemented a workforce reduction affecting approximately 10% of employees in the third quarter to reduce operating expenses.
• Other programs, such as the StealthX exosome platform, have been deprioritized pending regulatory clarity on Deramiocel.

Management Commentary and Tone:

• CEO Linda Marbán, Ph.D., stated the company took important steps forward on regulatory filing and launch readiness, expressing confidence in the strength of the data as the PDUFA date approaches.
• Management highlighted the operational readiness of the San Diego facility to move quickly to bring Deramiocel to patients if approved.
• The tone emphasized the critical nature of preserving upper limb function for patient independence as Duchenne progresses.

Other Key Points:

• Deramiocel holds Orphan Drug, RMAT, and Rare Pediatric Disease designations in the U.S., and Orphan Drug and ATMP designations in Europe.
• The Rare Pediatric Disease designation may qualify Capricor for a Priority Review Voucher upon approval.
• The company withdrew its motion for a preliminary injunction in the NS Pharma dispute without prejudice to resolve the matter in arbitration.
• The HOPE-3 results were published in The Lancet in July, reporting a statistically significant slowing of upper limb disease progression (p=0.029).