SPRO

Key Q2 2026 Milestones

• The FDA approved UTEP-Z, the first and only oral carbapenem approved in the U.S. for treatment of complicated urinary tract infections including pyelonephritis, developed in partnership with licensing partner GSK. GSK holds exclusive global commercialization rights excluding select Asian territories retained by Meiji.
• Sparrow entered an exclusive license agreement with InnoVent Biologics for SP001 (IBI355), granting Sparrow exclusive worldwide development and commercialization rights outside of Greater China, with up to $1.1 billion in total contingent deal value. The pipeline has been repositioned to focus on immune-mediated diseases.
• The company closed a $105 million non-dilutive, non-recourse royalty financing with affiliates of Healthcare Royalty (KKR), which unlocked value from future UTEP-Z milestone and royalty payments to fund SP001 development.
• Dr. Deborah Zak, an experienced immunology and drug development leader, joined as Chief Medical Officer on August 3, 2026 to lead clinical development of SP001.

SP001 Asset and Development Overview

• SP001 is a third-generation, fully humanized, Fc-silent IgG1 monoclonal antibody targeting CD40 ligand, an upstream immune activation signal that mediates pathogenic crosstalk between T cells, B cells, and antigen-presenting cells in immune-mediated disease.
• SP001 has completed two Phase I studies in healthy volunteers and a Phase Ib multiple ascending dose study in primary Sjogren's disease, with data from the Sjogren's trial presented at the 2026 EULAR Congress.
• Sparrow plans to advance SP001 first for immunoglobulin G4-related disease (IgG4RD), a serious chronic fibroinflammatory disease with no approved options for durable long-term disease control. A Phase II proof-of-concept trial is expected to initiate in Q2 2027, planned as an open-label study with two dosing arms enrolling up to 15 patients per arm.

• Following the closing of the $105 million royalty financing, management updated cash runway guidance to extend into the second half of 2029. This guidance accounts for the $35 million non-refundable upfront payment to InnoVent, planned operating expenses, and planned capital expenditures for SP001 development.

Sparrow Therapeutics is a biotech focused on therapeutic development, and did not report separate product segment revenue for Q2 2026. The firm recorded $0 total revenue in Q2 2026, compared to $14.2 million total revenue in Q2 2025. The year-over-year revenue decline occurred because all collaboration revenue from prior partnerships with Pfizer and GSK, and all funding from government awards, was fully realized and received in prior periods. Research and development (R&D) expenses were $3.4 million in Q2 2026, a decrease from $10.7 million in Q2 2025, driven by reduced clinical activity after early completion of the UTEP-Z Phase III trial in H1 2025 and lower personnel costs. General and administrative (G&A) expenses were $6.5 million in Q2 2026, up from $5.9 million in Q2 2025, driven by higher business development, legal, and consulting costs. Net loss was $9.6 million ($0.16 diluted loss per share) in Q2 2026, compared to a $1.7 million net loss ($0.03 diluted loss per share) in Q2 2025. As of June 30, 2026, the company held $50.8 million in cash and cash equivalents, which does not include the net proceeds from the July 2026 royalty financing.

• Forward-looking statements related to clinical development timelines, trial outcomes, market growth for IgG4RD, and commercial opportunity are subject to inherent risks and uncertainties that could cause actual results to differ materially from expectations. These risks are detailed in Sparrow's SEC filings, including the Risk Factors section of the Q2 2026 Form 10-Q.
• The $105 million royalty financing is non-recourse to Sparrow, so the firm's other assets are not exposed to UTEP-Z launch or sales risk, as repayment is limited solely to future UTEP-Z milestone and royalty proceeds.

Q: Can you elaborate on SP001's structural features that could make it best-in-class for CD40 ligand targeting, and how you will assess clinical benefit in the IgG4RD Phase II trial and position the product commercially?

A: SP001 is a specific monoclonal antibody with favorable pharmacokinetics, unlike competing CD40 ligand-targeting molecules that include fusion proteins. For the Phase II proof-of-concept trial, the primary endpoints of interest are symptom control, sustained disease control over the study period, and reduction in steroid and DMARD use, which are particularly valuable for this older patient population. Flare suppression will be evaluated in later Phase III development after initial proof-of-concept is established.

Q: How does Euplizna's recent market uptake in IgG4RD inform your view of SP001's commercial opportunity, and how will SP001 fit into the existing treatment armamentarium?

A: IgG4RD is an early-cycle disease with a specific diagnostic code only implemented in 2023, so diagnosis rates and prescriber awareness are expected to increase substantially over the coming years, expanding the total addressable market similarly to other rare diseases. Current treatments work by depleting B cells, but they require intermittent treatment and patients still experience cycles of remission and relapse, with significant side effect burdens from long-term steroid use. SP001's upstream mechanism that controls B-T cell crosstalk can provide sustained ongoing disease control to prevent flare recurrence and reduce organ damage progression, fitting an unmet need in the current treatment landscape. It can be used after B-cell depleters to maintain long-term control once a flare is managed.