Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)

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 financial statements and the related notes to those statements included elsewhere in this Report and with the audited financial statements and the related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, as filed with the SEC, on March 13, 2026. In addition to historical financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties, and assumptions. Some of the numbers included herein have been rounded for the convenience of presentation. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors. See "Cautionary Note Regarding Forward-Looking Statements."

Overview

We are a commercial stage biotechnology company focused on the research, development, and commercialization of innovative solutions for oncology. Through our acquisition of Proteomedix, which closed on December 15, 2023, we own Proclarix, an in vitro diagnostic test for prostate cancer originally developed by Proteomedix and approved for sale in the European Union under the In Vitro Diagnostic Regulation ("IVDR"), which we anticipate will be marketed in the U.S. as a lab developed test through our license agreement with LabCorp.

Since our inception in October 2018 until April 2023, when we acquired ENTADFI, we devoted substantially all of our resources to performing research and development, undertaking preclinical studies and enabling manufacturing activities in support of our product development efforts, hiring personnel, acquiring and developing our technology and now halted vaccine candidates, organizing and staffing our company, performing business planning, establishing our intellectual property portfolio and raising capital to support and expand such activities.

ENTADFI is an FDA-approved, once daily pill that combines finasteride and tadalafil for the treatment of BPH, a disorder of the prostate. However, in light of (i) the time and resources needed to continue pursuing commercialization of ENTADFI, and (ii) the Company's cash runway and indebtedness, the Company abandoned commercialization of ENTADFI and no longer holds remaining inventory of the product as of December 31, 2025. In addition, as part of cost reduction efforts and in connection with our initial pause in commercializing ENTADFI, we terminated three employees involved with the ENTADFI program, effective April 30, 2024, with such individuals to continue assisting the Company on an as-needed, consulting basis. Based on the circumstances surrounding ENTADFI, at June 30, 2024, the ENTADFI assets were fully impaired.

Proclarix is an easy-to-use next generation protein-based blood test that can be done with the same sample as a patient's regular Prostate-Specific Antigen ("PSA") test. The PSA test is a well-established prostate specific marker that measures the concentration of PSA molecules in a blood sample. A high level of PSA can be a sign of prostate cancer. However, PSA levels can also be elevated for many other reasons including infections, prostate stimulation, vigorous exercise or even certain medications. PSA results can be confusing for many patients and even physicians. It is estimated over 50% of biopsies with elevated PSA are negative or clinically insignificant resulting in an overdiagnosis and overtreatment that impacts the physician's routine, our healthcare system, and the quality of patients' lives. Approximately 10% of all men have elevated PSA levels., commonly referred to as the diagnostic "grey zone", of which only 20 - 40% present clinically with cancer. Proclarix is intended for use in diagnosing these patients where it is difficult to decide if a biopsy is necessary to verify a potential clinically significant cancer diagnosis. Proclarix helps doctors and patients with unclear PSA test results through the use of our proprietary Proclarix Risk Score which delivers clear and immediate diagnostic support for further treatment decisions. No additional intervention is required, and results are available quickly. Local diagnostic laboratories can integrate this multiparametric test into their current workflow because Proclarix assays use the enzyme-linked immunosorbent assay (ELISA) standard, which most diagnostic laboratories are already equipped to process.

Proclarix is CE-marked and for sale in Europe. We continue our sales efforts and expect growing revenues from sales of Proclarix in 2026 and beyond. We anticipate these sales to offset some expenses relating to commercial scale up and development, we expect our expenses also to increase in connection with our ongoing activities, as we:

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commercialize Proclarix;

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hire additional personnel;

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operate as a public company;

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obtain, maintain, expand, and protect our intellectual property portfolio; and

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perform product validation studies in connection with a license agreement.

We rely and will continue to rely on third parties for the manufacturing of Proclarix. We have no internal manufacturing capabilities, and we will continue to rely on third parties, of which the main suppliers are single-source suppliers, for commercial product.

We do not have any products approved for sale, aside from Proclarix. We have abandoned commercialization of ENTADFI and have destroyed our inventory of the product.

To date, we have financed our operations primarily with proceeds from our sale of preferred securities to seed investors, the initial public offering ("IPO"), and subsequent offerings of debt and equity securities. We will continue to require significant additional capital to commercialize Proclarix, and to fund operations for the foreseeable future. Accordingly, until such time as we can generate significant revenue, if ever, we expect to finance our cash needs through public or private equity or debt financings, third-party (including government) funding and to rely on third-party resources for marketing and distribution arrangements, as well as other collaborations, strategic alliances and licensing arrangements, or any combination of these approaches, to support our operations.

Some recent key developments affecting our business include the following:

Realbotix Corp. Share Exchange Agreement

On February 11, 2026, we entered into a Share Exchange Agreement (the "Share Exchange Agreement"), by and among (i) Onconetix, (ii) Realbotix Corp., a company existing under the laws of the Province of Ontario ("Parent"), (iii) Simulacra Corporation, a Delaware corporation and a wholly-owned subsidiary of Parent (the "Seller") and (iv) Realbotix, LLC, a Delaware limited liability company and wholly owned subsidiary of the Seller (the "Realbotix").

Pursuant to the Share Exchange Agreement, subject to the terms and conditions set forth therein, the Seller agreed to contribute and transfer to us, and we agreed to acquire and accept, all of the issued and outstanding equity interests of Realbotix (the "Realbotix Interests") in exchange for newly issued shares of Common Stock. (the "Share Exchange" and the other transactions contemplated by the Share Exchange Agreement, the "Realbotix Transactions").

Unless otherwise defined herein, the capitalized terms used below are defined in the Share Exchange Agreement.

Consideration

In full consideration for the contribution of the Realbotix Interests, we will issue shares of Common Stock to the Seller (the "Exchange Shares"), such that, immediately following the Closing and after giving effect to such issuance, the Seller will own a percentage of our fully diluted shares (the "Fully Diluted Shares") that will be adjusted based on Net Cash (as defined below) as follows: (i) if Net Cash is greater than or equal to $12.5 million, but less than $15.0 million, Seller will own 90% of the Fully Diluted Shares, (ii) if Net Cash is greater than or equal to $15.0 million, but less than $18.0 million, Seller will own 85% of the Fully Diluted Shares, (iii) if Net Cash is greater than or equal to $18.0 million, but less than $20.0 million, Seller will own 80% of the Fully Diluted Shares and (iv) if Net Cash is greater than or equal to $20.0 million, Seller will own 75% of the Fully Diluted Shares. "Net Cash" means the amount of cash and cash equivalents held by us upon the Closing, whether received by Realbotix or us in connection with the Realbotix Transactions, net of D&O tail insurance costs; change-of-control or other payments owed to our officers and director of as a result of the Realbotix Transactions; all our indebtedness; certain of our liabilities and our transaction expenses.

Conversion of Company Convertible Securities

Prior to the consummation of the Share Exchange, the holders of Realbotix Convertible Securities will exercise their rights to receive Realbotix Interests pursuant to the terms of such Realbotix Convertible Securities (as defined below) at the applicable conversion ratio as set forth in the Realbotix Convertible Securities (the "Realbotix Convertible Securities Conversion"). Upon completion of the Realbotix Convertible Securities Conversion and prior to Closing, all Realbotix Convertible Securities will be canceled or terminated, as applicable, will no longer be outstanding and will cease to exist and no payment or distribution will be made with respect thereto. Each holder of Realbotix Convertible Securities thereafter will cease to have any rights with respect to such securities.

Closing Conditions

The consummation of the Share Exchange is subject to customary closing conditions, including (i) the accuracy of the representations and warranties of the parties (subject to customary materiality qualifiers); (ii) compliance in all material respects by the parties with their respective covenants and agreements under the Share Exchange Agreement; (iii) delivery of customary closing certificates and good standing certificates; (iv) receipt by Board of a fairness opinion; (v) the absence of any law, order or injunction prohibiting the consummation of the Realbotix Transactions and (vi) receipt of any required third-party and regulatory approvals and consents.

The obligation of the Realbotix, Parent and Seller to complete the Closing is subject to the condition that, at Closing, we shall have an aggregate of at least $12.5 million in Net Cash (the "Net Cash Condition").

Additionally, the obligation of Realbotix, Parent and us to complete the Closing are subject to the conditions that (i) we have entered into an agreement with an investor, reasonably acceptable to us and Realbotix, providing for an equity line of credit pursuant to which such investor would commit to purchase up to an aggregate of $125.0 million of Common Stock and (ii) the conversion of our Preferred Stock into Common Stock and the termination of or certain amendments to of all Onconetix Options and Onconetix Warrants (the "Convertible Securities Condition").

Termination

In addition to termination by mutual written agreement, for the other party's uncured breach or if a governmental order permanently prohibits the Closing, the Share Exchange Agreement provides for termination:

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By either party if the Closing has not been consummated on or before November 30, 2026, provided the terminating party is not in breach in a manner that caused the failure to close by such date. The date is automatically extended to December 20, 2026 if all conditions to Closing other than the Net Cash Condition have been satisfied.

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By either party if our stockholder approval is not obtained at the stockholder meeting (including any adjournment or postponement thereof).

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By Realbotix if a Buyer Adverse Recommendation Change (as defined in the Share Exchange Agreement) occurs prior to receipt of Buyer stockholder approval.

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By us in connection with entering into a definitive agreement for a Buyer Superior Proposal (as define in the Share Exchange Agreement).

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By us if the audited Realbotix financial statements have not been delivered by April 30, 2026.

Each party will bear its own fees and expenses incurred in connection with the negotiation, execution and performance of the Share Exchange Agreement and the Realbotix Transactions. However, the Share Exchange Agreement provides for the payment of termination fees and reimbursement of transaction expenses in the following termination scenarios:

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In the event of a termination of the Share Exchange Agreement as a result of a material breach by either party, the breaching party will be required to pay a termination fee to the non-breaching party of $500,000 plus transaction expenses, with such transaction expenses not to exceed $500,000.

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In the event of a termination of the Share Exchange Agreement (i) by the Company as the result of a Buyer Adverse Recommendation Change or (ii) by Buyer upon entering into an agreement in respect of a Buyer Superior Proposal as a result of a Buyer Adverse Recommendation Change, Buyer must pay a termination fee of (A) $500,000 plus all Seller transaction expenses plus (B) if the transaction in respect of a Buyer Superior Proposal closes, an additional $1,500,000 upon closing of such transaction. If the transaction contemplated by the Buyer Superior Proposal doesn't close, Buyer is only obligated to pay $500,000 plus all Seller transaction expenses.

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In the event of a termination of the Share Exchange Agreement by Realbotix for failure to satisfy the Net Cash Condition, if Net Cash at the time of termination would be greater than $5.0 million (assuming the consummation of any Transaction Financing pursuant to Financing Agreements), we are obligated to pay Realbotix's transaction expenses, with such transaction expenses not to exceed $500,000.

Representations and Warranties

We, Realbotix, and the Seller have made customary representations and warranties in the Share Exchange Agreement. The representations and warranties of us, Realbotix, and the Seller will not survive the Closing.

Covenants of the Parties

Each party to the Share Exchange Agreement agreed to use its commercially reasonable efforts to consummate the Realbotix Transaction.

The Share Exchange Agreement contains certain covenants by each of the parties, to be observed during the period between the execution of the Share Exchange Agreement and Closing, including covenants regarding: (1) the provision of access to information, properties, books, records and personnel; (2) delivery of audited financial statements of the Company; (3) litigation support; (4) the preparation and filing of a registration statement, SEC reports and related disclosure documents and compliance with Nasdaq listing and reporting requirements; (5) no insider trading; (6) further assurances; (7) public announcements; (8) confidentiality; (9) indemnification of directors and officers and tail insurance; and (10) transfer taxes.

The parties have agreed to take all necessary actions to cause our Board, immediately after closing, to consist of five directors, including: (i) one person who is designated by us and reasonably acceptable to Realbotix and (ii) four persons who are designated by Realbotix and reasonably acceptable to us.

We have also agreed to prepare and file with the Securities and Exchange Commission ("SEC") a registration statement on Form S-4 in connection with the registration under the Securities Act of 1933, as amended (the "Securities Act"), of the issuance of the Exchange Shares to be issued under the Share Exchange Agreement and containing a proxy statement (a "Proxy Statement") for the purpose of soliciting proxies from our stockholders for the matters to be acted on at the special meeting of our stockholders. We have also agreed to use reasonable best efforts to maintain its listing on the Nasdaq and to enable the listing on Nasdaq of the Exchange Shares.

During the time between the execution of the Share Exchange Agreement and the Closing, Realbotix agreed to conduct its business in the ordinary course of business in all material respects and to comply with certain covenants regarding the operation of its business, including covenants related to (i) amendments to the Realbotix's organizational documents; (ii) recapitalization of the Realbotix's equity interests; (iii) issuance of additional securities; (iv) incurrence of additional indebtedness; (v) material changes to tax elections; (vi) amendments to or termination of material contracts; (vii) maintenance of books and records; (viii) establishment of any subsidiary or entry into a new line of business; (ix) maintenance of insurance policies; (x) revaluation of material assets or material changes in accounting methods, principles or policies, except as required to comply with U.S. GAAP; (xi) waiver, settlement or compromise of material claims, actions or proceedings, subject to specified thresholds; (xii) acquisition of equity interests or assets, or any other form of business combination, outside of the ordinary course of business; (xiii) capital expenditures in excess of specified thresholds; (xiv) adoption of a plan of liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization; (xv) voluntary incurrence of liabilities or obligations in excess of specified thresholds other than pursuant to contracts in existence as of the date of the Share Exchange Agreement or entered into in the ordinary course of business; (xvi) sale, lease, license or other disposition of any material portion of the Realbotix's assets, properties or rights; (xvii) entry into any agreement, understanding or arrangement relating to the voting of the Realbotix's equity interests; (xviii) taking any action that would reasonably be expected to materially delay or impair the obtaining of any required governmental or regulatory consents in connection with the Share Exchange Agreement; or (xix) authorization or agreement to take any of the foregoing actions.

During the same period, we also agreed to conduct its business in the ordinary course of business in all material respects and to comply with certain interim operating covenants, including covenants restricting our ability, without Realbotix's prior written consent (subject to specified exceptions), to (i) amend its organizational documents; (ii) effect mergers, consolidations, acquisitions, liquidations, restructurings or other business combinations; (iii) issue, repurchase, redeem or otherwise modify its equity securities or declare dividends or other distributions; (iv) incur additional indebtedness or guarantee obligations of third parties; (v) dispose of material assets or subsidiaries; (vi) make material loans, advances or capital contributions; (vii) make material tax elections or changes in accounting methods, principles or practices, except as required by applicable law, GAAP or Regulation S-K; (viii) amend, terminate, waive or assign material contracts other than in the ordinary course of business; (ix) fail to maintain books, records or insurance coverage in the ordinary course of business; (x) establish subsidiaries or enter into new lines of business; (xi) settle material litigation or other proceedings other than within specified thresholds; (xii) make capital expenditures or incur liabilities in excess of specified thresholds; (xiii) enter into arrangements relating to the voting of Common Stock; (xiv) take actions that would reasonably be expected to materially delay or impair the receipt of required governmental or regulatory approvals; or (xv) authorize, commit or publicly propose any of the foregoing actions.

Governing Law

The Share Exchange Agreement is governed by the laws of the State of Delaware.

February 2026 Special Meeting of Stockholders

On February 3, 2026, the Company held a special meeting of stockholders (the "Special Meeting"), whereby its stockholders approved an amendment to the Company's Amended and Restated Certificate of Incorporation to effect a reverse stock split of all of the outstanding shares of Common Stock at a ratio in the range of 1-for-2 to 1-for-50, at any time prior to the one-year anniversary date of the Special Meeting.

On March 6, 2026, the Board determined to fix a reverse stock split ratio of its Common Stock of 1-to-5 (the "Reverse Stock Split"). On March 24, 2026, the Company filed the Amendment to its Charter with the Secretary of State of the State of Delaware to effect the Reverse Stock Split. The Reverse Stock Split became effective in accordance with the terms of the Amendment at 12:01 a.m. Eastern Time on March 25, 2026 (the "Effective Time"). The Company's Common Stock continues to trade on The Nasdaq Capital Market under the symbol ONCO and has been trading on a split-adjusted basis since the market opened on March 25, 2026. At the Effective Time, every 5 (five) shares of the Company's issued and outstanding Common Stock had converted automatically into one (1) issued and outstanding share of Common Stock, with no corresponding reduction in the number of authorized shares of Common Stock, and without any change in the par value per share.

Resignation of Andrew Oakley and Thomas Meier as Directors; Elections of Sammy Dorf as Chairman of the Board

Effective on April 20, 2026, Andrew Oakley and Thomas Meier notified the Board of their resignation from the Board. As a result of their resignation from the Board and effective as of the date mentioned herein, Mr. Oakley has also resigned from his position as Chairman of the Board and his service on the Audit Committee, Compensation Committee and the Nominating and Corporate Governance Committee, and Mr. Meier has also resigned from his service on the Compensation Committee.

Effective on April 23, 2026, the Board has appointed Sammy Dorf, an existing member of the Board, as Chairman of the Board. In connection with Mr. Dorf's election as Chairman, the Compensation Committee of the Board has agreed to compensate Mr. Dorf $20,000 per year, with $5,000 payable on a quarterly basis, commencing on the date of his election.

Election of Josh Epstein

Effective as of April 23, 2026, the Board elected Josh Epstein to serve as a member of the Board and a member of the Audit Committee, Compensation Committee and as the chair of the Nominating and Corporate Governance Committee. Mr. Epstein, a Class II director, will serve for a term expiring at the Company's 2026 annual meeting of stockholders.

For his service on the Board, Mr. Epstein will receive compensation consistent with that of other non-employee directors.

Result of the Special Meeting of Stockholders of the Company held on April 30, 2026

On April 30, 2026, the Company held a special meeting of stockholders (the "April 2026 Special Meeting"). At the April 2026 Special Meeting, the stockholders of the Company approved the stockholder proposal to grant discretionary authority to Board to amend the Amended and Restated Certificate of Incorporation of the Company to effect one or more reverse stock splits of the Common Stock, at a ratio in the range of 1-for-2 to 1-for-10, provided that, (X) the Company shall not effect the aforementioned reverse stock splits that, in the aggregate, exceed 1-for-100, and (Y) any such reverse stock split is completed no later than the one year anniversary date of the April 2026 Special Meeting.

Series E PIPE Financing

On October 1, 2025, the Company entered into a securities purchase agreement (the "Series E Securities Purchase Agreement") with institutional investor(s) and sold to such institutional investors(s)(collectively, the "Series E PIPE Investors"), an aggregate of 7,813 shares of Series E convertible preferred stock, par value $0.00001 per share ("Series E Preferred Stock"), which are convertible into common stock of the Company, $0.00001 par value per share and warrants (the "Series E Warrants") to purchase 405,045 shares of Common Stock, for an aggregate purchase price of approximately $6.25 million, which was also equal to the net cash proceeds. The exercise price of the Series E Warrants is $19.288, and the Series E Warrants are exercisable beginning on the issuance date and expire on the third anniversary of the issuance date.

Concurrently with entering into the Series E Securities Purchase Agreement, the Company also entered into a registration rights agreement with the Series E PIPE Investors, pursuant to which it has agreed to provide the Series E PIPE Investors with certain registration rights related to the shares of Common Stock underlying the shares of Series E Preferred Stock and Series E Warrants.

During the three months ended March 31, 2026, the holders converted 232 shares of Series E Preferred Stock into 76,555 shares of Common Stock. As of March 31, 2026, there are 7,581 shares of Series E Preferred Stock outstanding.

Series D PIPE Financing

On September 22, 2025, the Company entered into a securities purchase agreement (the "Series D Securities Purchase Agreement") with eleven institutional investors, and sold or exchanged debt, to such investors (collectively, the "Series D PIPE Investors") an aggregate of 16,099 shares of Series D convertible preferred stock, par value $0.00001 per share ("Series D Preferred Stock"), which includes an issuance of 500 shares of Series D Preferred Stock to the lead investor in consideration for the Series D PIPE Investors' irrevocable commitment to purchase shares of the Series D Preferred Stock, and warrants (the "Series D Warrants") to purchase 872,565 shares of Common Stock, for an aggregate purchase price of approximately $12.9 million and net cash proceeds of $9.3 million. The exercise price of the Series D Warrants is $18.448, and the Series D Warrants are exercisable beginning on the issuance date and expire on the third anniversary of the issuance date.

Concurrently with entering into the Series D Securities Purchase Agreement, the Company also entered into a registration rights agreement with the Series D PIPE Investors, pursuant to which it has agreed to provide the Series D PIPE Investors with certain registration rights related to the shares of Common Stock underlying the shares of Series D Preferred Stock and Series D Warrants.

During the three months ended March 31, 2026, the holders converted 6,373 shares of Series D Preferred Stock into 2,222,656 shares of Common Stock. Additionally, the holders exercised 144,087 warrants for shares of Common Stock, resulting in net proceeds of $384,842. As of March 31, 2026, there are 9,952 shares of Series D Preferred Stock outstanding.

Reverse Stock Split

On June 13, 2025, the Company effected a reverse stock split of all shares of its issued and outstanding Common Stock at a ratio of one-for-eighty-five (1:85). The Company accounted for the reverse stock split on a retrospective basis pursuant to Accounting Standards Codification ("ASC") 260, Earnings Per Share. All issued and outstanding common stock, common stock warrants, and share-based awards' exercise prices and per share data have been adjusted in these consolidated financial statements, on a retrospective basis, to reflect the reverse stock split for all periods presented. The number of authorized shares and par value of the preferred stock and common stock were not adjusted because of the reverse stock split.

On March 25, 2026, the Company effected a reverse stock split of all shares of its issued and outstanding Common Stock at a ratio of one-for-five (1:5). The Company accounted for the reverse stock split on a retrospective basis pursuant to Accounting Standards Codification ("ASC") 260, Earnings Per Share. All issued and outstanding common stock, common stock warrants, and share-based awards' exercise prices and per share data have been adjusted in these consolidated financial statements, on a retrospective basis, to reflect the reverse stock split for all periods presented. The number of authorized shares and par value of the preferred stock and common stock were not adjusted because of the reverse stock split.

Certain Significant Relationships

We have entered into grant, license and collaboration arrangements with various third parties as summarized below. For further details regarding these and other agreements, see Notes 5 to each of our audited financial statements included in the Form 10-K and unaudited financial statements included elsewhere in this Report.

Laboratory Corporation of America

On March 23, 2023, Proteomedix entered into a license agreement with LabCorp pursuant to which LabCorp has the exclusive right to develop and commercialize Proclarix and other products developed by LabCorp using Proteomedix's intellectual property covered by the license, in the United States ("Licensed Products" and the agreement, the "LabCorp Agreement"). In consideration for granting LabCorp an exclusive license, Proteomedix received an initial license fee in the mid-six figures upon signing of the contract. Additionally, Proteomedix is entitled to royalty payments between 5% and 10% on the net sales recognized by LabCorp of any Licensed Products plus milestone payments as follows:

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after the first sale of Proclarix as a laboratory developed test, LabCorp will pay an amount in the mid-six figures;

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after LabCorp achieves a certain amount in the low seven figures in net sales of the Licensed Products, LabCorp will pay Proteomedix an amount in the low seven figures; and

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after a certain amount in the mid-seven figures in net sales of Licensed Products, LabCorp will pay Proteomedix an amount in the low seven figures.

A total of $2.5 million in milestone payments are payable under the license agreement. An additional $0.5 million was paid to Proteomedix as an initial license fee in 2023.

LabCorp is wholly responsible for the cost, if any, of research, development and commercialization of Licensed Products in the United States but has the right to offset a portion of those costs against future royalty and milestone payments. Additionally, LabCorp may deduct royalties or other payments made to third parties related to the manufacture or sale of Licensed Products up to a maximum amount of any royalty payments due to Proteomedix.

The license agreement and related royalty payment provisions expire during 2038, which approximates the expiration of the last patent covered by the license agreement. LabCorp has the right to terminate the license agreement for any reason by providing 90 days written notice to Proteomedix. Either party may terminate the license agreement due to a material breach of the terms of the license agreement with 30 days' notice, provided such breach is not cured within the foregoing 30-day period. Finally, Proteomedix may terminate the license agreement with 60 days' notice in the event LabCorp fails to make any undisputed payment due, provided that LabCorp does not remit the payment within the foregoing 60-day period.

On December 6, 2025, Proteomedix and LabCorp entered into an amendment (the "LabCorp Amendment") of the LabCorp License Agreement. The Amendment provides for a new validation study to be conducted by LabCorp for Proclarix, titled Prostate Cancer Risk Identification in a Multi-Ethnic Cohort: A Prospective U.S.-Based Multi-Center Validation Study of Proclarix (the "PRIME Study"). Pursuant to the LabCorp Amendment, LabCorp will not be required to pay any royalties or milestone payments in connection with its use of the risk calculator for purposes of the PRIME Study. The Company will compensate LabCorp with specified milestone-based payments for conducting the PRIME Study of up to $300,000 in the aggregate and will bear all associated costs and expenses. Mid-five figure milestone payments will be made as subjects are enrolled, commencing on the effective date of the PRIME Study and to be paid for every additional batch of subjects enrolled. If the final milestone tier is not reached, the Company must pay Labcorp a fixed amount per subject enrolled beyond the last milestone tier that was paid. All payments are due within thirty (30) days of each invoice.

Pursuant to the LabCorp Amendment, LabCorp is also required to provide the Company with the results of each clinical study conducted by LabCorp upon completion; however, the Company may not use or disclose such results to any third party without LabCorp's prior consent.

Immunovia-Proteomedix Licensing Agreement

On September 17, 2025, Proteomedix entered into a licensing agreement (the "Immunovia Agreement") with Immunovia, Inc. ("Immunovia"), a pancreatic cancer diagnostics company based in Lund, Sweden. Under the Agreement, Proteomedix will provide Immunovia with master cell lines required to produce antibodies for three of the five biomarkers used in the PancreaSure test, as well as a license to key intellectual property related to the manufacturing of associated reagents.

In return, Immunovia will make total payments of $0.6 million over two payments of $0.3 million each to Proteomedix, due on September 30, 2025 ("Initial Up Front Payment"), and March 31, 2026 ("Second Up Front Payment"). Based on the terms of the agreement and the nature of the license, the Company determined that the performance obligations were satisfied upon the transfer of the licensed rights which occurred during 2025. Accordingly, the Company recognized $0.6 million as license revenue during the year ended December 31, 2025.

Additionally, Immunovia will make a $0.1 million payment for materials and pay a 3% royalty on net sales of PancreaSure and any other products incorporating the licensed intellectual property from January 1, 2026, through December 31, 2032.

Services Agreement

On July 21, 2023, the Company, entered into a Licensing and Services Master Agreement ("Master Services Agreement") and a related statement of work with IQVIA, pursuant to which IQVIA was to provide to the Company commercialization services for the Company's products, including recruiting, managing, supervising and evaluating sales personnel and providing sales-related services for such products, for fees totaling up to $29.1 million over the term of the statement of work. The statement of work had a term through September 6, 2026, unless earlier terminated in accordance with the Master Services Agreement and the statement of work. On July 29, 2023, a second statement of work was entered into with IQVIA for certain subscription services providing prescription market data access to the Company. The fees under the second statement of work totaled approximately $800,000, and the term was through July 14, 2025. On October 12, 2023, the Company terminated the Master Services Agreement and the statements of work. The Company recorded net credits of approximately $0 and $0.9 million related to this contract during the three months ended March 31, 2026 and 2025, respectively, which is included in selling, general and administrative expense in the accompanying consolidated statements of operations and comprehensive loss. The Company had approximately $0 recorded in related accounts payable as of March 31, 2026 and December 31, 2025, respectively, which includes amounts due for early termination of the contract.

On January 15, 2025, the Company and IQVIA entered into a Settlement Agreement (the "IQVIA Settlement Agreement") concerning potential termination payments under the Master Services Agreement and statements of work. Pursuant to the IQVIA Settlement Agreement, the Company agreed to pay to IQVIA an aggregate of $150,000 in exchange for a mutual release of all claims in connection with the Master Services Agreement. As of December 31, 2025, the Company paid IQVIA the agreed upon amount of $150,000 and recorded a gain of approximately $(0.9) million on settlement of accounts payable.

Components of Results of Operations

Selling, General and Administrative Expenses

Selling, general and administrative expenses consist principally of commercialization activities, and personnel expenses, including salaries and bonuses, benefits and stock-based compensation expenses, professional fees for legal, consulting, accounting and tax services, information technology costs, costs incurred with respect to acquisitions and potential acquisitions, and other general operating expenses.

We anticipate that our selling, general and administrative expenses related to Proteomedix will increase when compared to historical levels as a result of efforts to commercialize Proclarix, and costs associated with integration of Proteomedix's operations.

Research and Development Expenses

Historically, substantially all of our research and development expenses consist of expenses incurred in connection with the development of our product candidates. These expenses historically have included fees paid to third parties to conduct certain research and development activities on our behalf, consulting costs, costs for laboratory supplies, product acquisition and license costs, certain payroll, and personnel-related expenses, including salaries and bonuses, employee benefit costs and stock-based compensation expenses for our research and product development employees. We expense both internal and external research and development expenses as they are incurred.

We do not allocate our costs by product candidate, as a significant amount of research and development expenses include internal costs, such as payroll and other personnel expenses, laboratory supplies, and external costs, such as fees paid to third parties to conduct research and development activities on our behalf, that are not tracked by product candidate.

As discussed above, we have terminated the vaccine programs that substantially all of our research and development historically related to. We do not anticipate incurring significant research and development expenses in the near future, unless we are able to resume such activities. Predicting the timing or cost to complete our clinical programs for future product candidates, or validation of our commercial manufacturing and supply processes is difficult and delays may occur because of many factors, including factors outside of our control, such as regulatory approvals. Furthermore, we are unable to predict when or if our future product candidates will receive regulatory approval with any certainty.

Other Income (Expense)

Other income (expense) is comprised of interest expense on notes payable, the change in fair value of financial instruments that are recorded as liabilities, which includes the related party subscription agreement liability, the contingent warrant liability, derivative liabilities, and other financing-related costs.

Results of Operations

Comparison of the Three Months Ended March 31, 2026 and 2025

The following table summarizes our statements of operations for the periods indicated:

		Three Months Ended March 31, 2026				Three Months Ended March 31, 2025				$ Change				% Change
Revenue		$	21,457			$	101,630			$	(80,173	)			(78.9	)%
Cost of revenue			23,112				55,798				(32,686	)			(58.6	)%
Gross profit			(1,655	)			45,832				(47,487	)			(103.6	)%
Operating expenses
Selling, general and administrative		$	2,039,328			$	1,674,206				365,122				21.8	%
Research and development			50,818				24,455				26,363				107.8	%
Impairment of goodwill			8,134,000				10,918,000				(2,784,000	)			(25.5	)%
Total operating expenses			10,224,146				12,616,661				(2,392,515	)			(19.0	)%
Loss from operations			(10,225,801	)			(12,570,829	)			2,345,028				18.7	%
Other income (expense)
Interest expense			(2,244	)			(223,592	)			221,348				99.0	%
Change in fair value of subscription agreement liability - related party			-				3,319,000				(3,319,000	)			(100.0	)%
Change in fair value of contingent warrant liability			1,612				(9,795	)			11,407				116.5	%
Change in fair value of Series D derivative liability			3,955,778				-				3,955,778				100.0	%
Change in fair value of Series E derivative liability			2,072,590				-				2,072,590				100.0	%
Gain on forgiveness of accounts payable			-				944,694				(944,694	)			(100.0	)%
Other - net			(16,810	)			(5,363	)			(11,447	)			(213.4	)%
Total other income			6,010,926				4,024,944				1,985,982				49.3	%
Loss before income taxes			(4,214,875	)			(8,545,885	)			4,331,010				50.7	%
Income tax benefit			-				-				-				-	%
Net loss		$	(4,214,875	)		$	(8,545,885	)			4,331,010				50.7	%
Deemed dividend Series C preferred stock			-				(1,170,091	)			1,170,091				100	%
Net loss applicable to common stockholders'		$	(4,214,875	)		$	(9,715,976	)			5,501,101				56.6	%

Revenue, Cost of Revenue, and Gross Margin

For the three months ended March 31, 2026, the Company generated approximately $21 thousand of revenue, compared to approximately $102 thousand for the same period in 2025. The decrease in revenue was primarily attributable to lower product sales generated by Proteomedix during the current period, reflecting reduced customer demand and timing of orders compared to the prior year period. Cost of revenue for the three months ended March 31, 2026 was approximately $23 thousand, compared to approximately $56 thousand for the same period in 2025, and was primarily attributable to costs incurred related to Proteomedix product sales. The Company reported a gross loss for the three months ended March 31, 2026 as cost of revenue exceeded revenue, primarily due to lower sales volumes during the period, while certain production and fulfillment costs remained relatively fixed.

Selling, General and Administrative Expenses

For the three months ended March 31, 2026, selling, general and administrative expenses increased by $0.4 million compared to the same period in 2025. The change is largely due to the increase in professional fees including accounting, legal, and regulatory fees, which were related to the additional filings and transactions during the current period.

Research and Development Expenses

For the three months ended March 31, 2026 research and development expenses increased by $26 thousand to $51 thousand compared to the same period in 2025. This change was due to the new clinical study agreement with LabCorp where the Company agreed to pay for research and development costs.

Impairments

The Company recorded an impairment of goodwill related to the PMX acquisition during the three months ended March 31, 2026 totaling $8.1 million, compared to $10.9 million during the three months ended March 31, 2025.

Other Income

Other income for the three months ended March 31, 2026, increased by approximately $2.0 million compared to the same period in 2025. The increase was primarily driven by a $4.0 million decrease in the change in fair value of Series D derivative liability, a $2.1 million decrease in the change in fair value of Series E derivative liability, partially offset by a $3.3 million decrease in the change in fair value of the subscription agreement liability - related party, a $0.9 million decrease to gain on forgiveness of accounts payable related to the settlement of IQVIA balances, and smaller changes in interest expense and other items.

Income Tax Benefit

The Company did not record any income tax benefit or expense during the three months ended March 31, 2026 and 2025.

Liquidity and Capital Resources

The Company's operating activities to date have been primarily devoted to seeking licenses, engaging in research and development activities, potential asset and business acquisitions, and expenditures associated with the now halted commercial launch of ENTADFI and the commercialization of Proclarix.

The Company has incurred substantial operating losses since inception and expects to continue to incur significant operating losses for the foreseeable future.

As of March 31, 2026, the Company had cash of approximately $3.7 million, a working capital surplus of approximately $1.3 million and an accumulated deficit of approximately $135.4 million. During the three months ended March 31, 2026, the Company used approximately $2.1 million in cash for operating activities. In addition, as of May 11, 2026, the Company's cash balance was approximately $4.1 million. The Company's current cash balance is not sufficient to fund its operations through the end of December 2026.

During the financial year ended December 31, 2025, the Company closed a Series D Preferred Stock financing in September 2025 and a Series E Preferred Stock financing in October 2025. Such financings provided the Company with additional cash flow to support near-term operations. While these capital raises may enable the Company to sustain current operations and meet existing obligations, the Company continues to generate recurring net operating losses and has not yet established sustained positive cash flows to support its strategic growth initiatives, which includes the commercialization of Proclarix and the closing of the Realbotix Transactions. These factors raise substantial doubt about the Company's ability to continue as a going concern within one year from the date of issuance of these consolidated financial statements.

Management's plans for funding the Company's operations include generating product revenue from sales of Proclarix, which is still subject to further successful commercialization activities within certain jurisdictions. Management also intends to secure additional funding through equity or debt financings if available, and to utilize the ELOC entered into in October 2024 on an as-needed basis to fund current operating needs, including future expenses incurred in connection with closing the Realbotix Transactions, subject to certain restrictions and beneficial ownership constraints. However, based on the terms of the ELOC and the current maximum availability, management determined that the funds readily available under the ELOC will not be sufficient to sustain operations. In addition, there are currently no other commitments in place for further financing nor is there any assurance that such financing will be available to sustain its operations and expand commercialization of Proclarix. If the Company is unable to secure additional capital, it may be required to curtail any future clinical trials, development and/or commercialization of Proclarix and any future product candidates, or it may be unable to close the Realbotix Transactions on a timely basis as contemplated in the Share Exchange Agreement. As such, the Company may take additional measures to reduce expenses in order to conserve its cash in amounts sufficient to sustain operations and meet its obligations, or, if it is required to, file for bankruptcy.

Because of historical and expected operating losses, net operating cash flow deficits, and debts due within one year, there is substantial doubt about the Company's ability to continue as a going concern for one year from the issuance of the consolidated financial statements, which is not alleviated by management's plans. The consolidated financial statements have been prepared assuming the Company will continue as a going concern. These consolidated financial statements do not include any adjustments that might be necessary from the outcome of this uncertainty.

Future Funding Requirements

We anticipate that we will continue to incur significant expenses for the foreseeable future as we continue to commercialize Proclarix and to close the Realbotix Transactions as contemplated in the Share Exchange Agreement.

We will require significant amounts of additional capital in the short-term, to continue to fund our continuing operations, to close the Realbotix Transactions, to satisfy existing and future obligations and liabilities contracts entered into in support of the Company's commercialization plans, in addition to funds needed to support our working capital needs and business activities, including the development and commercialization of Proclarix, and the development and commercialization of our future product candidates. Until we can generate a sufficient amount of revenue from sales of Proclarix if at all, we expect to finance our future cash needs through public or private equity or debt financings, third-party funding and marketing and distribution arrangements, as well as other collaborations, strategic alliances and licensing arrangements, or any combination of these approaches.

While the Company closed the Series D and E Preferred Stock financings during the financial year ended December 31, 2025, there are currently no other commitments in place for further financing nor is there any assurance that such financing will be available to the Company on favorable terms, if at all. This creates significant uncertainty whether the Company will have the funds available to be able to sustain its operations and expand commercialization of Proclarix, or to close the Realbotix Transactions on a timely basis as contemplated in the Share Exchange Agreement. If the Company is unable to secure additional capital, it may be required to curtail any future clinical trials, development and/or commercialization of future product candidates, delay the closing of or terminate the proposed Realbotix Transactions as contemplated in the Share Exchange Agreement, and it may take additional measures to reduce expenses in order to conserve its cash in amounts sufficient to sustain operations and meet its obligations, or, if it's required to, file for bankruptcy.

Our future capital requirements will depend on many factors, including:

	●	fees paid to financial, legal, accounting and other advisors in connection with negotiating and completing the Realbotix Transactions;
	●	the costs of future commercialization activities, including product manufacturing, marketing, sales, royalties, and distribution, for Proclarix, and other products for which we may receive marketing approval;
	●	the timing, scope, progress, results and costs of research and development, testing, screening, manufacturing, preclinical and non-clinical studies and clinical trials;
	●	the outcome, timing and cost of seeking and obtaining regulatory approvals from the FDA and comparable foreign regulatory authorities, including the potential for such authorities to require that we perform field efficacy studies, require more studies than those that we currently expect or change their requirements regarding the data required to support a marketing application;

	●	our ability to maintain existing, and establish new, strategic collaborations, licensing or other arrangements and the financial terms of any such agreements, including the timing and amount of any future milestone, royalty or other payments due under any such agreement;
	●	any product liability or other lawsuits related to our product;
	●	the expenses needed to attract, hire and retain skilled personnel;
	●	the revenue, if any, received from commercial sales of Proclarix, or other products for which we may have received or will receive marketing approval;
	●	the costs to establish, maintain, expand, enforce and defend the scope of our intellectual property portfolio, including the amount and timing of any payments we may be required to make, or that we may receive, in connection with licensing, preparing, filing, prosecuting, defending and enforcing our patents or other intellectual property rights; and
	●	the costs of operating as a public company.

A change in the outcome of any of these or other variables could significantly change the costs and timing associated with our business activities. Furthermore, our operating plans may change in the future, and we may need additional funds to meet operational needs and capital requirements associated with such change.

Cash Flows

The following table summarizes our cash flows for the periods indicated:

		Three months Ended March 31, 2026				Three months Ended March 31, 2025
Net cash used in operating activities		$	(2,121,481	)		$	(1,999,680	)
Net cash provided by investing activities			-				-
Net cash provided by financing activities			631,788				2,870,254
Effect of exchange rate changes on cash			(14,889	)			60,119
Net increase (decrease) in cash		$	(1,504,582	)		$	930,693

Cash Flows from Operating Activities

Net cash used in operating activities for the three months ended March 31, 2026, was approximately $2.1 million, which was primarily driven by a net loss of approximately $4.2 million and gain on change in fair value of derivative liabilities of approximately $6 million, which were offset by a non-cash stock-based compensation expense of approximately $0.02 million, loss on impairment of goodwill of approximately $8.1 million, and net changes in our operating assets and liabilities of $0.04 million.

Net cash used in operating activities for the three months ended March 31, 2025, was approximately $2.0 million, which was primarily driven by a net loss of approximately $8.5 million, a non-cash change in fair value of subscription liability of approximately $3.3 million, a gain on forgiveness of accounts payable of approximately $0.9 million, and net changes in our operating assets and liabilities of $0.07 million. These items were offset by several non-cash items, which primarily include impairment of goodwill of approximately $10.9 million.

Cash Flows from Financing Activities

Net cash provided by financing activities for the three months ended March 31, 2026, was approximately $0.6 million, and resulted primarily from proceeds of approximately $0.4 million from exercise of warrants.

Net cash provided by financing activities for the three months ended March 31, 2025, was approximately $2.9 million, and resulted primarily from proceeds of approximately $5.0 million from the purchase of common stock in connection with the ELOC and $0.1 million from the issuance of notes payable. These proceeds were offset by payments on notes payable of approximately $0.9 million and a payment of approximately $1.3 million related to redemption of the Series C Preferred Stock.

Legal Contingencies

From time to time, we may become involved in legal proceedings arising from the ordinary course of business. We record a liability for such matters when it is probable that future losses will be incurred and that such losses can be reasonably estimated.

Off-Balance Sheet Arrangements

During the periods presented we did not have, nor do we currently have, any off-balance sheet arrangements as defined in the rules and regulations of the SEC.

Recent Accounting Pronouncements Not Yet Adopted

See Note 3 to our condensed consolidated financial statements included elsewhere in this Report for more information.

Critical Accounting Policies and Estimates

Our consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, and expenses and the disclosure of contingent assets and liabilities in our consolidated financial statements. On an ongoing basis, we evaluate our estimates and judgments. We base our estimates on historical experience, known trends and events and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

As of March 31, 2026, there have been no material changes to our critical accounting policies and estimates from those disclosed in "Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates," included in our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC on March 13, 2026.

JOBS Act

Section 107 of the Jumpstart Our Business Startups Act ("JOBS") Act provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company" can delay the adoption of new or revised accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this extended transition period.

For as long as we remain an "emerging growth company" under the JOBS Act, we will, among other things:

●

be exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act, which requires that our independent registered public accounting firm provide an attestation report on the effectiveness of our internal control over financial reporting;

●

be permitted to omit the detailed compensation discussion and analysis from proxy statements and reports filed under the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), and instead provide a reduced level of disclosure concerning executive compensation; and

●

be exempt from any rules that may be adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotation or a supplement to the auditor's report on the financial statements.

We currently intend to take advantage of some or all of the reduced regulatory and reporting requirements that will be available to us so long as we qualify as an "emerging growth company," including the extension of time to comply with new or revised financial accounting standards available under Section 102(b) of the JOBS Act. Among other things, this means that our independent registered public accounting firm will not be required to provide an attestation report on the effectiveness of our internal control over financial reporting so long as we qualify as an emerging growth company, which may increase the risk that weaknesses or deficiencies in our internal control over financial reporting go undetected. Likewise, so long as we qualify as an emerging growth company, we may elect not to provide you with certain information, including certain financial information and certain information regarding compensation of our executive officers, that we would otherwise have been required to provide in filings we make with the SEC, which may make it more difficult for investors and securities analysts to evaluate our company. As a result, investor confidence in our company and the market price of our common stock may be materially and adversely affected.