Neurogene Inc. (NGNE)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the unaudited interim condensed consolidated financial statements and notes thereto included elsewhere in this report and our audited consolidated financial statements and notes thereto included as part of our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 24, 2026 (“Annual Report on Form 10-K”). Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business, include forward-looking statements that involve risks, uncertainties, and assumptions. As a result of many factors, including those factors set forth in the section entitled “Risk Factors,” our actual results or outcomes, or the timing of our results or outcomes, could differ materially from the results or outcomes described in or implied by 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 entitled “Risk Factors.” You should carefully read the “Cautionary Note About Forward-Looking Statements” and “Risk Factors” sections of the Annual Report on Form 10-K as well as the risk factors included in Part II, Item 1A of this Quarterly Report on Form 10-Q to gain an understanding of the important factors that could cause actual results to differ materially from the results described below.

Forward-looking statements are inherently uncertain and you should not place undue reliance on these statements, which speak only as of the date that they were made. These cautionary statements should be considered in connection with any written or oral forward-looking statements that we may issue in the future. Except as required by law, we do not undertake any obligation to revise or update publicly any forward-looking statements after completion of the filing of this Quarterly Report on Form 10‑Q to reflect later events or circumstances or to reflect the occurrence of unanticipated events, or otherwise.

In this section, references to “we,” “our,” “us,” and “the Company” refer to post-merger Neurogene Inc. and our wholly owned subsidiary incorporated in the state of Nevada, also named Neurogene Inc. (“Neurogene OpCo”), unless otherwise indicated.

Overview

Despite recent scientific advances in genetics, most neurological diseases, particularly those with devastating consequences to patients, are left untreated. Conventional gene therapy is an attractive potential treatment approach for only a limited number of monogenic diseases due to the challenges caused by the complex biology of neurological diseases and by inherent variable transgene uptake and expression. We are a clinical-stage biotechnology company committed to overcoming these limitations and turning today’s complex devastating neurological diseases into treatable conditions. We are building a robust and differentiated product portfolio of genetic medicines for rare neurological diseases with high unmet need not otherwise addressable by conventional gene therapy. One approach we are taking harnesses our proprietary transgene regulation technology, EXACTTM (Expression Attenuation via Construct Tuning), that utilizes microRNA-based genetic circuits designed to deliver therapeutic levels of transgene to key areas of the brain that underlie neurological disease pathology.

Our lead clinical-stage program, NGN-401, is in development for the treatment of Rett syndrome, a severe and progressive neurodevelopmental disease with substantial neurological and physical impairments and significant unmet need. NGN-401 is purposefully designed to utilize the EXACT platform and adeno-associated virus (“AAV”) delivery via intracerebroventricular (“ICV”) administration, and to deliver the full-length MECP2 gene which preserves the complete set of endogenous regulatory elements to restore functional MeCP2 protein. We believe ICV delivery is the most suitable route of administration to achieve optimal biodistribution in key regions of the brain and other parts of the nervous system that underlie Rett syndrome pathophysiology. We have completed dosing of 25 participants in our ongoing registrational trial of NGN-401, EmboldenTM, a single-arm, open-label, baseline-controlled trial evaluating the 1E15 vg dose of NGN-401 gene therapy in females with Rett syndrome. The Embolden trial is designed to evaluate NGN-401 in females ages three and above with potential to support a broad label in a single study and enable an efficient path to market. Top-line results are expected in the second half of 2027.

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We completed dosing in the Phase 1/2 open-label, multi-center clinical trial evaluating NGN-401 for the treatment of female patients with classic Rett syndrome in the second quarter of 2025. The trial is assessing the safety, tolerability, and efficacy of NGN-401 at a dose of 1E15 vg in eight participants in an ages 4-10 years cohort and two participants in an ages 11 years and older cohort.

In June 2026, we announced positive long-term clinical data from the Phase 1/2 trial with a data cutoff date of June 16, 2026. Across the 10 participants receiving the 1E15 vg dose, 100% improved in Clinical Global Impression–Improvement Scale (“CGI-I”) score and gained one or more developmental milestone, consistent with the composite endpoint used to evaluate efficacy in the Embolden registrational trial. Forty-seven total developmental milestones were gained, averaging 4.7 milestones per participant. Participants gained milestones in a progressive, developmentally ordered, stepwise sequence, suggesting a restart of developmental progression. Clinical improvements emerged rapidly, with a median time to first improvement of two months post-treatment. Milestone gains deepened over time, increasing by 95% from 6 to 12 months and by 147% from 6 to ≥12 months. Seven of 10 participants gained ≥2 developmental milestones and demonstrated improvements across ≥2 core Rett syndrome domains, including both pediatric and adolescent/adult participants. Improvement continued through 30 months post-dose, with no plateau observed and no milestones lost.

Participants also experienced clinically meaningful improvements across additional validated Rett syndrome scales, including the Rett Syndrome Gross Motor Scale (RSGMS) and Rett Syndrome Hand Function Scale (RSHFS) (p0.001).

In the Phase 1/2 trial, all treatment-related adverse events have been mild (Grade 1) or moderate (Grade 2) in severity, and the majority are known potential risks of AAV and have resolved or are resolving, as of the data cutoff date of June 16, 2026.

NGN-401 at the 1E15 vg dose continues to be generally well-tolerated in the Phase 1/2 trial and Embolden, with no cases of hemophagocytic lymphohistiocytosis (“HLH”) in any participant at this dose, as of August 10, 2026.

The Phase 1/2 trial previously included a cohort evaluating a 3E15 vg dose of NGN-401. In November 2024, the third participant receiving the 3E15 vg dose died following complications from a rare hyperinflammatory syndrome associated with systemic exposure to high doses of AAV, and we discontinued use of that dose. Hyperinflammatory syndromes can include HLH and multisystem inflammatory syndrome.

Based on research we conducted in 2025 related to hyperinflammatory syndromes and AAV gene therapy, HLH has only been reported following doses of AAV that are generally in the 1E14 vg/kg range or higher. The 1E15 vg dose used in the Phase 1/2 trial and in the Embolden registrational trial translates into the E13 vg/kg range, and we are not aware of any case of HLH ever being reported at this dose. HLH is an acute inflammatory reaction that, if it were to occur, would be expected to happen within days after dosing. Out of an abundance of caution, we incorporated enhanced monitoring into our Phase 1/2 and Embolden protocols for HLH markers, including ferritin, and a treatment algorithm that, when administered early, has been used successfully to treat cases of HLH both in other AAV gene therapies and other known causes of HLH.

In June 2025, we first announced written agreement from the FDA on key elements of the NGN-401 Embolden registrational trial design, and we confirmed these elements and the trial design in September 2025. The primary endpoint is a responder-based composite endpoint that will assess an improvement in CGI-I with Rett syndrome anchors and the gain of a developmental milestone, compared to the participant’s own baseline. Responders are defined as participants who attain a CGI-I score less than or equal to three (“minimally improved”) and gain any one developmental milestone from a list of 28, as captured through standardized video recordings and independently verified by blinded central raters at the 12-month endpoint. The primary analysis to support the planned BLA is expected to occur after the first 24 participants have completed 12 months of follow-up. A response rate of 33% is the minimum threshold for success to reject the null hypothesis in the Embolden trial. We expect to report top-line data in the second half of 2027, and therefore we do not plan to share data updates from the trial before that time.

Clinical grade NGN-401 manufactured at our fully operational current good manufacturing practices (“cGMP”) facility in Houston, Texas was used for dosing in the Phase 1/2 clinical trial and the Embolden trial. We believe that our in-house manufacturing capabilities better enable control of product quality and development timelines, strategic pipeline and financial flexibility, and clinical-to-commercial continuity.

We previously reached alignment with the FDA on our potency assay strategy and chemistry, manufacturing and controls (“CMC”) planning for the program. We initiated our Process Performance Qualification (“PPQ”) campaign in July 2026 and confirmed our commercial manufacturing scale is the same as our current clinical manufacturing scale, removing the need for comparability studies. We expect to complete the PPQ runs by the end of 2026.

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In February 2026, we announced that NGN-401 received Breakthrough Therapy designation based on the FDA’s review of interim efficacy and safety data from the Phase 1/2 trial as of the data cutoff date of October 30, 2025, including patient-level data and supporting video documentation. Breakthrough Therapy designation is intended to expedite the development and review of medicines for the treatment of serious conditions which have shown preliminary clinical evidence indicating the potential for substantial improvement over available therapies on a clinically significant endpoint. The benefits of Breakthrough Therapy designation include eligibility for Priority Review, rolling submission of sections of the BLA and the FDA’s organizational commitment to help determine an efficient route to approval.

In March 2025, we announced that NGN-401 received Priority Medicines (“PRIME”) designation by the European Medicines Agency (“EMA”). Medicines are eligible for PRIME if they demonstrate the potential to address an unmet medical need by showing a meaningful improvement of clinical outcomes.

In August 2024, we announced that NGN-401 received Regenerative Medicine Advanced Therapy (“RMAT”) designation from the FDA. RMAT designation is granted for regenerative medicines intended to treat, modify, reverse, or cure a serious or life-threatening disease or condition, and with preliminary clinical evidence that indicates that the drug has the potential to address unmet medical needs. Ben

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Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited consolidated financial statements and related notes appearing elsewhere in this Annual Report on Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business, include forward-looking statements that involve risks, uncertainties, and assumptions. As a result of many factors, including those factors set forth in the section entitled “Risk Factors,” our actual results or outcomes, or the timing of our results or outcomes, could differ materially from the results or outcomes described in or implied by 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 entitled “Risk Factors.” You should carefully read the “Cautionary Note About Forward-Looking Statements” and “Risk Factors” sections of this Annual Report on Form 10-K to gain an understanding of the important factors that could cause actual results or outcomes, or the timing of our results or outcomes, to differ materially from the results or outcomes described below.

In this section, references to “we,” “our,” “us,” and “the Company” refer to post-merger Neurogene Inc. and our wholly owned subsidiary incorporated in the state of Nevada, also named Neurogene Inc. (“Neurogene OpCo”), unless otherwise indicated.

Overview

Despite recent scientific advances in genetics, most neurological diseases, particularly those with devastating consequences to patients, are left untreated. Conventional gene therapy is an attractive potential treatment approach for only a limited number of monogenic diseases due to the challenges caused by the complex biology of neurological diseases and by inherent variable transgene uptake and expression. We are a clinical-stage biotechnology company committed to overcoming these limitations and turning today’s complex devastating neurological diseases into treatable conditions. We are building a robust and differentiated product portfolio of genetic medicines for rare neurological diseases with high unmet need not otherwise addressable by conventional gene therapy. One approach we are taking harnesses our proprietary transgene regulation technology, EXACTTM (Expression Attenuation via Construct Tuning), that utilizes microRNA-based genetic circuits that are designed to deliver therapeutic levels of transgene to key areas of the brain that underlie neurological disease pathology.

Our first clinical-stage program, NGN-401, utilizes the EXACT platform and adeno-associated virus (“AAV”) delivery, and is in development for the treatment of Rett syndrome, a severe and progressive neurodevelopmental disease with substantial neurological and physical impairment and significant unmet need. Our ongoing registrational trial of NGN-401, EmboldenTM, is a single-arm, open-label, baseline-controlled trial evaluating the 1E15 vg dose of NGN-401 in 20 females with Rett syndrome. The Embolden trial is designed to evaluate NGN-401 in females ages three and above with potential to support a broad label in a single study and enable an efficient path to market. Embolden has enrolled 100% of participants, and more than 50% of participants have been dosed. We expect to complete dosing in the second quarter of 2026. We completed dosing in a Phase 1/2 open-label, multi-center clinical trial of NGN-401 gene therapy for Rett syndrome, with ten participants receiving the 1E15 vg dose. NGN-401 is delivered using a one-time intracerebroventricular (“ICV”) procedure, which we believe is the most suitable route of administration to achieve optimal biodistribution in key regions of the brain and other parts of the nervous system that underlie Rett syndrome pathophysiology. Clinical grade NGN-401 manufactured at our fully operational current good manufacturing practices (“cGMP”) facility in Houston, Texas was used for dosing in the Phase 1/2 clinical trial and is being used for the Embolden trial. We believe that our in-house manufacturing capabilities better enable control of product quality and development timelines, strategic pipeline and financial flexibility, and clinical-to-commercial continuity.

We received clearance of our Investigational New Drug (“IND”) application for NGN-401 by the U.S. Food and Drug Administration (“FDA”) in January 2023.

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In November 2025, we announced updated positive interim clinical data from the Phase 1/2 NGN-401 trial in the pediatric cohort (ages 4-10) receiving the 1E15 vg dose (n=8 for efficacy data; n=10 for safety data, including pediatric and adolescent/adult participants) with a data cutoff date of October 30, 2025.

All pediatric participants, regardless of baseline disease severity, experienced functional gains, with an aggregate 35 developmental milestones gained across core clinical domains of Rett syndrome, including hand function/fine motor, language/communication and ambulation/gross motor. Participants with longer term follow-up continued to gain developmental milestones and those more recently dosed with six months of follow-up also demonstrated milestone gains. All developmental milestones and CGI‑I improvements reported as of November 2024 were durable as of the data cutoff date, with no changes observed.

As of October 30, 2025, four out of five participants with at least 12 months of follow-up met the responder definition of the primary endpoint planned for assessment at Month 12 in the Embolden trial. The three participants with six months of follow-up have also showed early clinical activity, consistent with previously dosed participants.

We also reported safety and tolerability data from the ten participants in the Phase 1/2 clinical trial who received the 1E15 vg dose of NGN-401 as of the data cutoff date of October 30, 2025. We believe that NGN-401 has been generally well-tolerated at the 1E15 vg dose, with no cases of hemophagocytic lymphohistiocytosis (“HLH”) in any participant at this dose. All treatment-related adverse events (“AEs”) have been Grade 1 (mild) or Grade 2 (moderate) in severity, and the majority are known potential risks of AAV and have resolved or are resolving. Participant 5 experienced two Grade 2 serious adverse events (“SAEs”) related to an abnormal nerve conduction finding - areflexia and related elective inpatient diagnostic testing. The nerve conduction finding has returned to the normal range. Unrelated to NGN-401, Participant 5 also experienced a leg fracture confounding her Month 12 gross motor assessment.

The Phase 1/2 trial previously included a cohort evaluating a 3E15 vg dose of NGN-401. In November 2024, the third participant receiving the 3E15 vg dose died following complications from a rare hyperinflammatory syndrome associated with systemic exposure to high doses of AAV, and we discontinued use of that dose. Hyperinflammatory syndromes can include HLH and multisystem inflammatory syndrome.

Based on research we conducted in 2025 related to hyperinflammatory syndromes and AAV gene therapy, HLH has only been reported following doses of AAV that are generally in the 1E14 vg/kg range or higher. The 1E15 vg dose used in the Phase 1/2 trial and in the Embolden registrational trial translates into the E13 vg/kg range, and we are not aware of any case of HLH ever being reported at this dose. Out of an abundance of caution, we incorporated enhanced monitoring into our Phase 1/2 and Embolden protocols for HLH markers, including ferritin, and a treatment algorithm that when administered early, has been used successfully to treat cases of HLH both in other AAV gene therapies and other known causes of HLH.

In June 2025, we first announced written agreement from the FDA on key elements of the NGN-401 EmboldenTM registrational trial design, and we confirmed these elements and the trial design in September 2025. Embolden is a single-arm, open-label, baseline-controlled trial evaluating the 1E15 vg dose of NGN-401 in 20 females with Rett syndrome. The trial is designed to evaluate NGN-401 in females ages three and above with potential to support a broad label in a single study and enable an efficient path to market.

The primary endpoint is a responder-based composite endpoint that will assess an improvement in the Clinical Global Impression–Improvement Scale (“CGI-I”) with Rett syndrome anchors and the gain of a developmental milestone, compared to the participant’s own baseline. Responders are defined as participants who attain a CGI-I score less than or equal to three (“minimally improved”) and gain any one developmental milestone from a list of 28, as captured through standardized video recordings and independently verified by blinded central raters at the 12-month endpoint. A response rate of 35% (or 7 out of 20 patients) is the minimum threshold for success to reject the null hypothesis in the Embolden trial.

Embolden has enrolled 100% of participants, and more than 50% of participants have been dosed. We expect to complete dosing in the second quarter of 2026. NGN-401 at the 1E15 vg dose has been generally well-tolerated in the Phase 1/2 trial and Embolden, with no cases of HLH as of March 23, 2026. We expect to present updated interim safety and efficacy data on the pediatric cohort and the adolescent/adult cohort from the Phase 1/2 trial in mid-2026.

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We previously reached alignment with the FDA on our potency assay strategy and chemistry, manufacturing and control (“CMC”) planning for the program. We plan to initiate our Process Performance Qualification (“PPQ”) campaign in mid-2026 and confirmed our commercial manufacturing scale is the same as our current clinical manufacturing scale, removing the need for comparability studies.

In February 2026, we announced that NGN-401 received Breakthrough Therapy designation based on the FDA’s review of interim efficacy and safety data from the Phase 1/2 trial as of the data cutoff date of October 30, 2025, including patient-level data and supporting video documentation. Breakthrough Therapy designation is intended to expedite the development and review of medicines for the treatment of serious conditions which have shown preliminary clinical evidence indicating the potential for substantial improvement over available therapies on a clinically significant endpoint. The benefits of Breakthrough Therapy designation include eligibility for Priority Review, rolling submission of sections of the BLA and the FDA’s organizational commitment to help determine an efficient route to approval.

In March 2025, we announced that NGN-401 received Priority Medicines (“PRIME”) designation by the European Medicines Agency (“EMA”). Medicines are eligible for PRIME if they demonstrate the potential to address an unmet medical need by showing a meaningful improvement of clinical outcomes.

In August 2024, we announced that NGN-401 received RMAT designation from the FDA. RMAT designation is granted for regenerative medicines intended to treat, modify, reverse, or cure a serious or life-threatening disease or condition, and with preliminary clinical evidence that indicates that the drug has the potential to address unmet medical needs. Benefits of the RMAT designation program include early and frequent communications with FDA senior managers, intensive guidance on efficient drug development and eligibility for an Accelerated Approval pathway and Priority Review.

In June 2024, we announced that NGN-401 was one of four sponsors selected by the Center for Biologics Evaluation and Research at the FDA to participate in the FDA’s Support for clinical Trials Advancing Rare disease Ther

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