ARDELYX, INC.

Previous wording

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the condensed financial statements and notes thereto included elsewhere in this report and with the audited financial statements and related notes thereto included as part of our 2025 Form 10-K. This discussion and analysis and other parts of this report contain forward-looking statements that involve risk and uncertainties, such as statements of our plans, objectives, expectations and intentions. Our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the section of this report titled “Risk Factors.” These forward-looking statements speak only as of the date hereof. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason. Unless the context requires otherwise, the terms “Ardelyx,” “Company,” “we,” “us” and “our” refer to Ardelyx, Inc.

Current wording

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the condensed financial statements and notes thereto included elsewhere in this report and with the audited financial statements and related notes thereto included as part of our 2025 Form 10-K. This discussion and analysis and other parts of this report contain forward-looking statements that involve risks and uncertainties, such as statements of our plans, objectives, expectations and intentions. Our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the section of this report titled “Risk Factors.” These forward-looking statements speak only as of the date hereof. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason. Unless the context requires otherwise, the terms “Ardelyx,” “Company,” “we,” “us” and “our” refer to Ardelyx, Inc.

Previous wording

Tenapanor, branded as IBSRELA®, is approved in the U.S. for the treatment of adults with IBS-C. We believe that IBSRELA can bring meaningful benefit to the approximately 13 million Americans who suffer from the symptoms of IBS-C, many of whom continue to experience symptoms despite intervention with other therapies. We are seeking to further expand the IBSRELA eligible patient population to include patients with CIC, and have initiated a Phase 3 clinical trial (ACCEL) evaluating tenapanor in adults with CIC. In January 2026, we dosed the first patient in ACCEL and have initiated all pre-identified sites. We expect to complete enrollment by the end of 2026 and to announce topline data in the second half of 2027. IBSRELA is also being evaluated in multiple pediatric clinical trials which could expand its use and potentially provide six months of additional patent life for tenapanor.

Current wording

Tenapanor, branded as IBSRELA®, is approved in the U.S. for the treatment of adults with IBS-C. We believe that IBSRELA can bring meaningful benefit to the approximately 13 million Americans who suffer from the symptoms of IBS-C, many of whom continue to experience symptoms despite intervention with other therapies. We are seeking to further expand the IBSRELA eligible patient population to include patients with CIC, and have initiated a Phase 3 clinical trial (ACCEL) evaluating tenapanor in adults with CIC. Enrollment in ACCEL is now complete and we remain on track to announce topline data in the second half of 2027. IBSRELA is also being evaluated in multiple pediatric clinical trials which could expand its use and potentially provide six months of additional patent life for tenapanor.

Previous wording

We are also developing a next-generation NHE3 inhibitor, RDX10531, which has demonstrated in preclinical models to have improved solubility and potency compared to tenapanor. RDX10531 is currently being tested in IND-enabling studies. If successful, RDX10531 has potential for broad applications across multiple therapeutic areas.

Current wording

We are also developing a next-generation NHE3 inhibitor, RDX10531, which has demonstrated improved solubility and potency compared to tenapanor in preclinical models. RDX10531 is currently being tested in IND-enabling studies. If successful, RDX10531 has potential for broad applications across multiple therapeutic areas.

Previous wording

The results of operations for the three and six months ended June 30, 2026 are not necessarily indicative of results to be expected for the entire year ending December 31, 2026, or for any other interim period or future year. See Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our 2025 Form 10-K to enhance the understanding of our financial metrics below.

Current wording

The results of operations for the three and nine months ended September 30, 2026 are not necessarily indicative of results to be expected for the entire year ending December 31, 2026, or for any other interim period or future year. See Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our 2025 Form 10-K to enhance the understanding of our financial metrics below.

Previous wording

The increase in IBSRELA product sales, net in the three and six months ended June 30, 2026 primarily reflected higher demand, driven by continued increase in awareness and prescriber experience, and to a lesser extent, higher net price.

Current wording

The increase in IBSRELA product sales, net for the three and nine months ended September 30, 2026 primarily reflected higher demand, driven by continued increase in awareness and prescriber experience, and to a lesser extent, higher net price.

Previous wording

The increase in XPHOZAH product sales, net in the three and six months ended June 30, 2026 primarily reflected higher demand and net price. XPHOZAH product sales, net in the six months ended June 30, 2025 included a $3.8 million favorable adjustment driven by a change in previously estimated product returns.

Current wording

The increase in XPHOZAH product sales, net for the three and nine months ended September 30, 2026 primarily reflected higher demand and higher net price. XPHOZAH product sales, net for the nine months ended September 30, 2025 included a $3.8 million favorable adjustment driven by a change in previously estimated product returns.

Previous wording

Product supply revenue is primarily impacted by the timing of product supply shipments to our collaboration partners under our product supply agreements in support of the development and commercialization of our products ex-U.S. by our collaboration partners.

Current wording

Product supply revenue is primarily impacted by the timing of product supply shipments to our collaboration partners under our product supply agreements in support of the commercialization of our products ex-U.S. by our collaboration partners.

Previous wording

The product supply revenue was primarily attributable to Fosun Pharma in the three and six months ended June 30, 2026. In the three and six months ended June 30, 2025, the product supply revenue was primarily attributable to Kyowa Kirin.

Current wording

The product supply revenue was primarily attributable to Fosun Pharma for the three and nine months ended September 30, 2026. For the nine months ended September 30, 2025, the product supply revenue was primarily attributable to Kyowa Kirin.

Previous wording

The licensing revenue was primarily attributable to sales-based royalties received from Fosun Pharma in the three and six months ended June 30, 2026. The licensing revenue in the six months ended June 30, 2025 included a $5.0 million milestone earned in the 2025 first quarter under the terms of the Fosun Agreement, following the NDA approval by China’s Center for Drug Evaluation of the NMPA for tenapanor in the control of serum phosphorus in adult patients with CKD on hemodialysis.

Current wording

The licensing revenue was primarily attributable to sales-based royalties received from Fosun Pharma for the three and nine months ended September 30, 2026. The licensing revenue for the nine months ended September 30, 2025 included a $5.0 million milestone earned in the 2025 first quarter under the terms of the Fosun Agreement, following the NDA approval by China’s Center for Drug Evaluation of the NMPA for tenapanor in the control of serum phosphorus in adult patients with CKD on hemodialysis.

Previous wording

The increase in GTN adjustment percentage in the three and six months ended June 30, 2026 primarily reflected an unfavorable channel mix as well as Medicare and Medicaid Inflation Rebate charges.

Current wording

The increase in GTN adjustment percentage for the three and nine months ended September 30, 2026 was primarily driven by an unfavorable channel mix, reflecting higher sales under government managed-care pricing programs, as well as higher Medicare and Medicaid Inflation Rebate charges.

Previous wording

The increase in cost of product sales in the three and six months ended June 30, 2026 reflected higher product sales. A portion of the costs of IBSRELA and XPHOZAH units recognized as revenue during the three and six months ended June 30, 2026 was expensed as research and development expense in periods prior to the commencement of capitalization of inventory costs for each respective product. The cost associated with inventory sold but previously expensed as research and development was $0.3 million and $0.6 million for the three and six months ended June 30, 2026, and $1.0 million and $1.7 million for the three and six months ended June 30, 2025, respectively. The value of inventory on hand as of June 30, 2026 and December 31, 2025 that was previously expensed as research and development was approximately $8.0 million and $10.9 million, respectively.

Current wording

The increase in cost of product sales for the three and nine months ended September 30, 2026 reflected higher product sales. A portion of the costs of IBSRELA and XPHOZAH units recognized as revenue during the three and nine months ended September 30, 2026 was expensed as research and development expense in periods prior to the commencement of capitalization of inventory costs for each respective product. The cost associated with inventory sold but previously expensed as research and development was $0.4 million and $0.9 million for the three and nine months ended September 30, 2026, and $0.3 million and $2.0 million for the three and nine months ended September 30, 2025, respectively. The value of inventory on hand that was previously expensed as research and development as of September 30, 2026 and December 31, 2025 was approximately $8.8 million and $10.9 million, respectively.

Previous wording

The decrease in other cost of revenue in the three and six months ended June 30, 2026 primarily reflected the full recognition of the maximum $75.0 million royalty obligation under the AstraZeneca Termination Agreement as of the end of the 2025 second quarter and lower costs associated with product supply revenue. Other cost of revenue related to the AstraZeneca Termination Agreement was $3.8 million and $12.7 million for the three and six months ended June 30, 2025, respectively.

Current wording

The decrease in other cost of revenue for the nine months ended September 30, 2026 primarily reflected the full recognition of the maximum $75.0 million royalty obligation in connection with the AstraZeneca Termination Agreement as of the end of the 2025 second quarter, as well as lower costs associated with product supply revenue. Other cost of revenue related to the AstraZeneca Termination Agreement was $12.7 million for the nine months ended September 30, 2025.

Previous wording

External R&D expenses consist substantially of costs associated with our life cycle management initiatives for tenapanor, with more than half of these costs attributable to our CIC program for the three and six months ended June 30, 2026, respectively. External R&D expenses also include costs associated with early-stage, preclinical programs as well as unallocated program-specific costs, which were individually immaterial for the periods presented. We begin to track program-specific costs for early-stage, preclinical programs once they become material, which generally occurs following IND and when clinical-stage work has commenced. We do not track employee and facility-related expenses by program, as we typically use our employee and infrastructure resources across multiple R&D programs.

Current wording

External R&D expenses consist substantially of costs associated with our life cycle management initiatives for tenapanor, with more than half of these costs attributable to our CIC program for the three and nine months ended September 30, 2026. External R&D expenses also include costs associated with early-stage, preclinical programs as well as unallocated program-specific costs, which were individually immaterial for the periods presented. We begin to track program-specific costs for early-stage, preclinical programs once they become material, which generally occurs following IND and when clinical-stage work has commenced. We do not track employee and facility-related expenses by program, as we typically use our employee and infrastructure resources across multiple R&D programs.

Previous wording

The increase in external R&D expenses in the three and six months ended June 30, 2026 reflected increased clinical trial activities, including Phase 3 clinical trials evaluating tenapanor in adults with CIC, as well as engagement with medical and scientific communities in the areas of gastroenterology and nephrology related to our marketed products.

Current wording

The increase in external R&D expenses for the three and nine months ended September 30, 2026 reflected increased clinical trial activities, including the Phase 3 clinical trial evaluating tenapanor in adults with CIC.

Previous wording

The increase in employee-related expenses in the three and six months ended June 30, 2026 was primarily driven by increased headcount in connection with pipeline expansion activities as well as engagement with medical and scientific communities in the areas of gastroenterology and nephrology related to our marketed products.

Current wording

The increase in employee-related expenses for the three and nine months ended September 30, 2026 was primarily driven by increased headcount to support our pipeline expansion activities and engagement with medical and scientific communities in the areas of gastroenterology and nephrology related to our marketed products.

Previous wording

The increase in selling, general and administrative expenses in the three and six months ended June 30, 2026 primarily reflected increased commercialization and administrative costs to support net sales growth of IBSRELA, consisting of external spending for disease awareness initiatives, patient affordability, access support and related patient awareness, as well as increased commercial infrastructure costs. The increase was also attributable to increased headcount, including incremental stock-based compensation expenses of $3.1 million and $6.2 million in the three and six months ended June 30, 2026, respectively.

Current wording

The increase in selling, general and administrative expenses for the three and nine months ended September 30, 2026 primarily reflected increased commercialization and administrative costs to support net sales growth of IBSRELA, mainly driven by market access and promotional activities, as well as ongoing efforts to expand our sales force. The increase in selling, general and administrative expenses for the nine months ended September 30, 2026 also reflected higher administrative costs to support our commercial growth and ongoing strategic initiatives. The increase included incremental stock-based compensation expenses of $2.2 million and $8.4 million for the three and nine months ended September 30, 2026, respectively.

Previous wording

The increase in interest expense in the three and six months ended June 30, 2026 primarily reflected a higher outstanding loan balance resulting from the Term E Loan draw at the end of June 2025, partially offset by the reduced interest rate under the term loans resulting from the Sixth Amendment to our Loan Agreement effective at the end of April 2026.

Current wording

The increase in interest expense for the three and nine months ended September 30, 2026 primarily reflected the Term F Loan draw in June 2026. The increase in interest expense for the nine months ended September 30, 2026 also reflected the Term E Loan draw in June 2025. The increases were partially offset by the reduced interest rate under the Sixth Amendment to our Loan Agreement, effective April 28, 2026.

Previous wording

The decrease in non-cash interest expense related to the sale of future royalties in the three and six months ended June 30, 2026 primarily reflected the imputed interest accrued on the decreasing carrying value of the deferred royalty obligation and royalties received from Kyowa Kirin for sales of PHOZEVEL in Japan which were remitted to HCR.

Current wording

The decrease in non-cash interest expense related to the sale of future royalties for the three and nine months ended September 30, 2026 primarily reflected the imputed interest accrued on the lower carrying value of the deferred royalty obligation, as well as lower royalties received from Kyowa Kirin for sales of PHOZEVEL in Japan which were remitted to HCR.

Previous wording

In November 2025, we filed an automatic shelf registration statement on Form S-3ASR, which became effective upon filing, containing (i) a base prospectus, which covers the offering, issuance and sale from time to time in one or more offerings of our common stock, preferred stock, debt securities, warrants and/or units; and (ii) a prospectus supplement for the offering, issuance and sale of up to a maximum aggregate offering price of $100.0 million of our common stock that may be issued and sold from time to time under the 2025 Open Market Sales Agreement, deemed to be “at-the-market offerings.” Pursuant to the 2025 Open Market Sales Agreement, Jefferies, as sales agent, may receive a commission of up to three percent of the gross sales price for shares of our common stock sold under the 2025 Open Market Sales Agreement. As of June 30, 2026, there have been no sales of our common stock under the 2025 Open Market Sales Agreement.

Current wording

In November 2025, we filed an automatic shelf registration statement on Form S-3ASR, which became effective upon filing, containing (i) a base prospectus, which covers the offering, issuance and sale from time to time in one or more offerings of our common stock, preferred stock, debt securities, warrants and/or units; and (ii) a prospectus supplement for the offering, issuance and sale of up to a maximum aggregate offering price of $100.0 million of our common stock that may be issued and sold from time to time under an open market sales agreement (the Sales Agreement), deemed to be “at-the-market offerings.” Jefferies, as sales agent, may receive a commission of up to three percent of the gross sales price for shares of our common stock sold under the Sales Agreement. As of September 30, 2026, there have been no sales of our common stock under the Sales Agreement.

Previous wording

We have a loan and security agreement with SLR (the Loan Agreement). The Loan Agreement provides a total of $300.0 million, of which $250.0 million has been drawn and is outstanding as of June 30, 2026. The additional borrowing of $50.0 million pursuant to the Term G Loan is available at our election to draw through December 20, 2026. See Note 8. Borrowingfor further information on our long-term debt.

Current wording

We have a loan and security agreement with SLR (the Loan Agreement). The Loan Agreement provides for total borrowings of up to $300.0 million, of which $250.0 million was drawn and outstanding as of September 30, 2026, including $50.0 million of the Term F Loan drawn in the 2026 second quarter. The additional borrowing of $50.0 million pursuant to the Term G Loan is available at our election to draw through December 20, 2026. See Note 8. Borrowingfor further information on our long-term debt.

Previous wording

Cash flows from operating activities represent the cash receipts and payments related to all of our activities other than investing and financing activities. Net operating cash flow is derived by adjusting our net loss for non-cash operating items and changes in operating assets and liabilities resulting from timing differences between the cash receipts and payments and when the transactions are recognized in our result of operations. As a result, changes in net operating cash flow reflect, among other things, the timing of (i) cash collections from our Customers and (ii) payments made in the normal course of business such as payments to suppliers, including our CMOs, CROs and government agencies.

Current wording

Cash flows from operating activities represent the cash receipts and payments related to all of our activities other than investing and financing activities. Net operating cash flow is derived by adjusting our net loss for non-cash operating items and changes in operating assets and liabilities resulting from timing differences between the cash receipts and payments and when the transactions are recognized in our results of operations. As a result, changes in net operating cash flow reflect, among other things, the timing of (i) cash collections from our Customers and (ii) payments made in the normal course of business, such as payments to government agencies and to suppliers, including our CMOs and CROs.

Previous wording

Net cash used in operating activities decreased in the six months ended June 30, 2026, primarily due to the timing of our payments and inventory purchases, partially offset by the timing of cash collections from our Customers.

Current wording

Net cash used in operating activities decreased during the nine months ended September 30, 2026, primarily due to increased cash inflows generated from our product sales and the timing of our payments in the normal course of business, partially offset by the timing of our inventory purchases and cash collections from our Customers.

Previous wording

Cash flows from investing activities include cash used for capital expenditures and purchases of short-term investments as well as net proceeds from asset dispositions and maturities of short-term investments.

Current wording

Cash flows from investing activities, as applicable, include cash used for purchases of short-term investments and capital expenditures as well as net proceeds from maturities of short-term investments and asset dispositions.

Previous wording

Net cash provided by investing activities decreased in the six months ended June 30, 2026, primarily reflecting higher short-term investment purchases.

Current wording

Net cash used in investing activities increased during the nine months ended September 30, 2026, primarily reflecting higher short-term investment purchases.

Previous wording

Cash flows from financing activities include net proceeds associated with our Loan Agreement, sales of our common stock with respect to the “at-the-market offering” programs and issuances of our common stock under our equity incentive plans.

Current wording

Cash flows from financing activities, as applicable, include net proceeds associated with our Loan Agreement, issuance of our common stock under our equity incentive plans and sales of our common stock with respect to the “at-the-market offering” programs.

Previous wording

Net cash provided by financing activities included the receipts of the Term F Loan and the Term E Loan in the six months ended June 30, 2026 and 2025, respectively. Net cash provided by financing activities increased in the six months ended June 30, 2026, primarily due to higher proceeds received from the issuance of common stock under our equity incentive plans.

Current wording

Net cash provided by financing activities increased during the nine months ended September 30, 2026, primarily due to higher proceeds received from the issuance of common stock under our equity incentive plans. Net cash provided by financing activities included receipts of the Term F Loan and the Term E Loan during the nine months ended September 30, 2026 and 2025, respectively.

Previous wording

We have entered into various operating leases for our offices. As of June 30, 2026, our total undiscounted obligation for operating leases was $4.7 million, with maturities ranging up through July 2029. See Note 9. Leases for further information on our operating leases.

Current wording

We have entered into various operating leases for our offices. As of September 30, 2026, our total undiscounted obligation for operating leases was $4.3 million, with maturities ranging up through July 2029. See Note 9. Leases for further information on our operating leases.

Previous wording

Our preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts and related disclosures. We have discussed those policies and estimates that we believe are critical and require the use of significant judgment in their application in our 2025 Form 10-K. We have made no material changes to our critical accounting policies or the methodologies or assumptions that we apply under them during the six months ended June 30, 2026.

Current wording

Our preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts and related disclosures. We have discussed those policies and estimates that we believe are critical and require the use of significant judgment in their application in our 2025 Form 10-K. We have made no material changes to our critical accounting policies or the methodologies or assumptions that we apply under them during the nine months ended September 30, 2026.