Quarterly Report for Quarter Ending June 30, 2026 (Form 10-Q)

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 together with our unaudited interim condensed consolidated financial statements and the related notes appearing elsewhere in this Quarterly Report on Form 10-Q. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below in "Risk Factors", and those discussed in the section titled "Risk Factors" included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2026, as may be amended, supplemented or superseded from time to time by other reports we file with the SEC. All amounts in this report are in U.S. dollars, unless otherwise noted.

Throughout this Quarterly Report on Form 10-Q, references to "we," "our," "us," the "Company," "Immix," or "Immix Biopharma" refer to Immix Biopharma, Inc., individually, or as the context requires, collectively with its subsidiaries.

Our logo and some of our trademarks and tradenames are used in this Quarterly Report on Form 10-Q. This Quarterly Report on Form 10-Q also includes trademarks, tradenames and service marks that are the property of others. Solely for convenience, trademarks, tradenames and service marks referred to in this Quarterly Report on Form 10-Q may appear without the ®, ™ and SM symbols. References to our trademarks, tradenames and service marks are not intended to indicate in any way that we will not assert to the fullest extent under applicable law our rights or the rights of the applicable licensors if any, nor that respective owners to other intellectual property rights will not assert, to the fullest extent under applicable law, their rights thereto. We do not intend the use or display of other companies' trademarks and trade names to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

Certain capitalized terms used below and otherwise defined below, have the meanings given to such terms in the footnotes to our unaudited condensed consolidated financial statements included above under "Part I - Financial Information" - "Item 1. Financial Statements".

Unless the context otherwise requires and for the purposes of this Quarterly Report on Form 10-Q only:

	●	"Exchange Act" refers to the Securities Exchange Act of 1934, as amended;
	●	"SEC" or the "Commission" refers to the United States Securities and Exchange Commission; and
	●	"Securities Act" refers to the Securities Act of 1933, as amended.

Available Information

We file annual, quarterly, and current reports, proxy statements and other information with the Securities and Exchange Commission. Our SEC filings (reports, proxy information statements, and other information) are available to the public over the Internet at the SEC's website at www.sec.gov and are available for download, free of charge, soon after such reports are filed with or furnished to the SEC, on the "Investor & News," "SEC Filings" page of our website at www.immixbio.com. Copies of documents filed by us with the SEC are also available from us without charge, upon oral or written request to our Secretary, who can be contacted at the address and telephone number set forth on the cover page of this Report. The information contained on the websites referenced in this Quarterly Report on Form 10-Q is not incorporated by reference into this filing. Further, the Company's references to website URLs are intended to be inactive textual references only.

Overview

Immix Biopharma, Inc. is a clinical-stage biopharmaceutical company focused on the application of chimeric antigen receptor cell therapy ("CAR-T") in light chain ("AL") Amyloidosis and other serious diseases. Our lead cell therapy candidate is CAR-T NXC-201 ("NXC-201"), which is currently being evaluated in our ongoing United States Phase 1b/2 NEXICART-2 (NCT06097832) clinical trial. Enrollment for the Company's NEXICART-2 clinical trial of NXC-201 is complete with 45 patients enrolled.

NXC-201 has been awarded Regenerative Medicine Advanced Therapy ("RMAT") Designation by the FDA, Orphan Drug Designation ("ODD") by both the FDA and European Commission ("EC") in AL Amyloidosis and, most recently, in January 2026, Breakthrough Therapy designation by the FDA for the treatment of relapsed/refractory AL amyloidosis.

Our mission is to harness the immune system through innovative cell therapies and other modalities to deliver widely accessible cures in AL Amyloidosis and other serious diseases, as we believe patients are waiting.

Our strategy is to:

	●	Develop our lead candidate NXC-201 in AL Amyloidosis and other serious diseases; and
	●	Pursue development of NXC-201 and additional cell therapy candidates in other applicable indications where CAR-T is not an approved therapy today.

Our N-GENIUS platform (discussed below) has produced our clinical-stage lead candidate NXC-201, a next-generation CAR-T being designed to treat AL Amyloidosis and other serious diseases.

Figure 1: ImmixBio Pipeline

AL amyloidosis is a life-threatening immunological disorder in which an abnormal protein called amyloid builds up in tissues and organs. This abnormal protein is produced by long-lived plasma cells, a type of immune B-cell. The signs and symptoms of AL amyloidosis vary among patients because build-up may occur in the heart (most frequent cause of mortality), liver, kidneys, intestines, muscles, joints, nerves, or spleen, according to the National Institutes of Health. Diagnosis is frequently delayed, due to varied and non-specific symptoms including: fatigue, weight loss, shortness of breath, dizziness, and numbness in hands and feet. Upon diagnosis, many patients already have late-stage disease, and are not aware of available treatment options and clinical trials.

In December 2025, we announced positive interim phase 2 safety and efficacy data from our Phase1/2 NEXICART-2 clinical trial, the first U.S. trial of CAR-T in relapsed/refractory light chain AL, evaluating NXC-201. The results were as of November 13, 2025 and were presented by Heather Landau, MD, of Memorial Sloan Kettering Cancer Center in an oral presentation at the American Society of Hematology's ASH 2025 Annual Meeting. Prior to NXC-201 treatment, all patients were exposed to an anti-CD38 antibody and a proteasome inhibitor. Median prior lines of therapy were four (range: 1-10). All patients had baseline relapsed/refractory AL Amyloidosis organ involvement.

In January 2026, the FDA granted Breakthrough Therapy designation to sterically-optimized CAR-T NXC-201 for the treatment of relapsed/refractory AL amyloidosis. Per FDA, Breakthrough Therapy designation aims to expedite the development and review of drugs that are intended to treat a serious condition and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over available therapy on a clinically significant endpoint.

After NXC-201 treatment, complete responses ("CRs") were observed in 75% (at s/u IFE(-) level) (15 out of 20) patients as determined by an independent review committee. In four out of five pending patients, minimum residual disease ("MRD") negativity in bone marrow suggests a future complete response may be expected. Downstream clinical improvement, including organ responses, were observed in 70% of evaluable patients (7/10). No neurotoxicity has been observed. Grade 2 cytokine release syndrome was observed in four patients, Grade 1 cytokine release syndrome was observed in 11 patients, with a median duration of one day.

In May 2026, we announced that all four relapsed/refractory AL Amyloidosis MRD-negative patients presented at ASH 2025 had converted to CR). The NEXICART-2 CR rate was 95% (19 out of 20 patients). All CRs were reached within 1 year of follow-up post-dosing. No relapses have been observed to date for patients who have reached CR. All subsequently enrolled patients for whom MRD results are available are MRD-negative at one month. The Company plans to initiate a multi-center, randomized Phase 3 trial in newly diagnosed AL Amyloidosis patients. As of May 14, 2026, 17 of 20 patients in NEXICART-2 showed rapid normalization of diseased light chains in patients with a median time to initial response of 7 days. Safety data through May 14, 2026 has been generally consistent with previous safety data observed and reported in NEXICART-2 trial.

Our Other Programs

Our other programs include NXC-201 for treatment of select other serious diseases and other preclinical candidates.

Since inception, we have devoted substantially all of our resources to developing product and technology rights, conducting research and development, organizing and staffing our Company, business planning and raising capital. We operate as one business segment and have incurred recurring losses, the majority of which are attributable to research and development activities and negative cash flows from operations. We have funded our operations primarily through the sale of equity securities and grant proceeds. Currently, our primary use of cash, cash equivalents, and short-term investments is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures. We expect to continue to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates through all stages of development and clinical trials and, ultimately, seek regulatory approval. In addition, if we obtain regulatory approval for any of our product candidates, we expect to incur significant commercialization expenses related to product manufacturing, marketing, sales and distribution. Furthermore, we incur costs associated with operating as a public company, including significant legal, accounting, investor relations and other expenses. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical trials and our expenses on other research and development activities.

Research and License Agreement with Hadasit and BIRAD

On December 8, 2022, our subsidiary Nexcella entered into a Research and License Agreement (the "Agreement") with Hadasit Medical Research Services & Development, Ltd. and BIRAD - Research and Development Company Ltd. (collectively, the "Licensors") pursuant to which the Licensors granted to Nexcella an exclusive, worldwide, royalty-bearing license throughout the world, except Israel, Cyprus and other countries in the Middle East (the "Territory"), to an invention entitled "Anti-BCMA CAR-T cells to target plasma cell" to develop, manufacture, have manufactured, use, market, offer for sale, sell, have sold, export and import the Licensed Product (as defined in the Agreement). Pursuant to the Agreement, Nexcella paid the Licensors an upfront fee of $1,500,000 in December 2022. Additional quarterly payments totaling approximately $13.0 million are due through September 2026 along with an annual license fee of $50,000. Upon the merger of Nexcella with and into Immix, we assumed all of Nexcella's rights and obligations pursuant to the Agreement.

We are required to pay royalties to the Licensors equal to 5% of Net Sales (as defined in the Agreement) during the Royalty Period. "Royalty Period" means for each Licensed Product, on a country-to-country basis, the period commencing on December 8, 2022 and ending on the later of (a) the expiration of the last to expire Valid Claim (as defined in the Agreement) under a Licensed Patent (as defined in the Agreement), if any, in such country, (b) the date of expiration of any other Exclusivity Right (as defined in the Agreement) or data protection period granted by a regulatory or other governmental authority with respect to a Licensed Product or (c) 15 years from the date of First Commercial Sale (as defined in the Agreement) of a Licensed Product in such country.

In addition, we are required to pay milestone payments of up to $20.0 million upon the achievement of certain Net Sales milestones as set forth in the Agreement. Pursuant to the Agreement, Nexcella committed to funding NXC-201 clinical trials in Israel for a period of four years for an estimated total cost of approximately $13.0 million, spread on a quarterly basis over that period, the payment of which has been, and will be, paid by us since the merger in May 2024. We expect that the clinical trial data generated by the NXC-201 clinical trials in Israel will be owned by us. The term of the Agreement commenced on December 8, 2022 and, unless earlier terminated pursuant to the terms thereof, will continue in full force and effect until the later of the expiration of the last Valid Claim under a Licensed Patent or a Joint Patent (as defined in the Agreement) or Exclusivity Right covering a Licensed Product or the expiration of a continuous period of 15 years during which there shall not have been a First Commercial Sale of any Licensed Product in any country in the world. Licensors may terminate the Agreement immediately if we or our affiliates or sublicensees commences an action in which the validity, enforceability or scope of any of the Licensed Patents or Joint Patents is challenged. In addition, either party may terminate the Agreement if the other party materially breaches the Agreement and fails to cure such breach within 30 days. Additionally, Licensors may terminate the Agreement if we become insolvent or file for bankruptcy.

On December 16, 2024, our wholly-owned subsidiary, Nexcella, Inc., entered into the First Amendment to the Agreement (the "First Amendment") with the Licensors. The First Amendment includes terms specific to new licensed products and requires an additional upfront license fee of $1.5 million, which was paid in full as of December 31, 2025, as well as development milestone payments of up to $4.5 million upon the Company's achievement of certain milestones.

CIRM Grant

On July 25, 2024, we were awarded an $8.0 million grant from the California Institute for Regenerative Medicine ("CIRM") to support the clinical development of chimeric antigen receptor T-cell therapy NXC-201 for the treatment of relapsed/refractory AL Amyloidosis. The award is payable to us upon achievement of milestones that are primarily based on patient enrollment in our clinical trials. Additionally, if CIRM determines, in its sole discretion, that we have not complied with the terms and conditions of the grant, CIRM may suspend or permanently cease disbursements. Funds received under this grant may only be used for allowable project costs specifically identified with the CIRM-funded project. Such costs can include, but are not limited to, salary for personnel, itemized supplies, consultants, and itemized clinical study costs. Under the terms of the grant, both CIRM and we will co-fund the research project and the amount of our co-funding requirement is predetermined as a part of the award. We signed the grant agreement in November 2024 and began receiving funds from the grant in November of 2024. As of August 3, 2026, we have received $6.7 million in grant reimbursements under the grant agreement.

Citizens ATM Agreement

On June 3, 2025, we entered into an At The Market Offering Agreement (as amended from time to time, the "Citizens ATM Agreement") with Citizens JMP Securities, LLC ("Citizens"), which was amended on March 25, 2026, with pursuant to which we may offer and sell, from time to time, at our option, shares of our common stock, through Citizens, as the sales agent, having an aggregate offering price of up to $100,000,000 in an "at the market offering," as defined in Rule 415(a)(4) under the Securities Act. During the six months ended June 30, 2026, we sold 1,510,000 shares of common stock for net proceeds of $13,943,659, after offering expenses, pursuant to the Citizens ATM Agreement. As of June 30, 2026, we have sold an aggregate of 3,207,504 shares of common stock pursuant to the Citizens ATM Agreement for net proceeds of $18,353,089, after offering expenses.

Results of Operations

Three Months Ended June 30, 2026 compared to the Three Months Ended June 30, 2025

General and Administrative Expense

General and administrative expense was $7,123,171 for the three months ended June 30, 2026, compared to $2,745,247 for the three months ended June 30, 2025.

The expenses incurred in both periods were related to salaries, patent maintenance costs, professional fees and general accounting and other general consulting expenses, primarily related to the Company's efforts to raise capital, increased compensation, including stock-based compensation, of $1,681,376 due to hiring of additional employees, and increased other general expenses of $332,210.

Research and Development Expense

Research and development expense was $5,333,172 for the three months ended June 30, 2026, compared to $3,972,458 for the three months ended June 30, 2025.

The increase in research and development expenses was primarily driven by an increase in research and development expenses related to our ongoing Phase 1b/2a clinical trial and our CAR-T clinical trial, including, but not limited to, CRO and related costs for maintaining and treating patients in the clinical trial, as well as site onboarding costs and license fees. We were able to increase spending on research and development in 2026 as a result of funding from multiple share offerings during the year ended December 31, 2025 and three months ended June 30, 2026. Additionally, the Company received approximately $0.5 million in CIRM grant reimbursement, which is recorded as an offset to research and development expenses.

Interest Income

Interest income was $913,663 for the three months ended June 30, 2026, compared to $104,056 for the three months ended June 30, 2025. Interest income was related to interest received on investments in money market funds and US Treasuries. The increase is a result of the Company maintaining higher balances during the current period.

Provision for Income Taxes

Provision for income taxes for the three months ended June 30, 2026 was $14,322 compared to $8,914 for the three months ended June 30, 2025, due to withholding taxes relating to our Australian subsidiary.

Net Loss

Net loss for the three months ended June 30, 2026 was $11,557,002 compared to $6,622,563 for the three months ended June 30, 2025, which increase was due primarily to the increase in general and administrative expenses, as discussed above.

Six Months Ended June 30, 2026 compared to the Six Months Ended June 30, 2025

General and Administrative Expense

General and administrative expense was $11,946,549 for the six months ended June 30, 2026, compared to $5,453,098 for the six months ended June 30, 2025.

The expenses incurred in both periods were related to salaries, patent maintenance costs, professional fees and general accounting and other general consulting expenses, primarily related to the Company's efforts to raise capital, increased compensation, including stock-based compensation, of $2,194,338 due to hiring of additional employees, and increased other general expenses of $765,097.

Research and Development Expense

Research and development expense was $11,3313,649 for the six months ended June 30, 2026, compared to $5,947,532 for the six months ended June 30, 2025.

The increased research and development expenses were related to our ongoing Phase 1b/2a clinical trial and our CAR-T clinical trial, including, but not limited to, CRO and related costs for maintaining and treating patients in the clinical trial, as well as site onboarding costs and license fees. We were able to increase spending on research and development in 2026 as a result of funding from multiple share offerings during the year ended December 31, 2025 and six months ended June 30, 2026. The Company received approximately $2.0 million in CIRM grant reimbursement, which is recorded as an offset to research and development expenses.

Interest Income

Interest income was $1,630,831 for the six months ended June 30, 2026, compared to $254,275 for the six months ended June 30, 2025. Interest income was related to interest received on investments in money market funds and US Treasuries. The increase is a result of the Company maintaining higher balances during the current period.

Provision for Income Taxes

Provision for income taxes for the six months ended June 30, 2026 was $14,322 compared to $18,736 for the six months ended June 30, 2025, due to withholding taxes relating to our Australian subsidiary.

Net Loss

Net loss for the six months ended June 30, 2026 was $21,643,689 compared to $11,165,091 for the six months ended June 30, 2025, which increase was due primarily to the increase in general and administrative expenses, as discussed above.

Liquidity and Capital Resources

Sources of Liquidity

We do not have any approved products for commercial sale and have never generated revenue from product sales and have incurred significant net losses since our inception and expect to continue to incur net operating losses for the foreseeable future. We do not expect to receive any revenue from any product candidates that we develop unless and until we obtain regulatory approval and commercialize our product candidates or enter into collaborative arrangements with third parties. We currently have no credit facility or committed sources of capital.

Our primary use of cash, cash equivalents, and short-term investments is to fund operating expenses, which consist of clinical research and development expenses, manufacturing expenses, legal and compliance expenses, compensation and related expenses, and general overhead costs. Cash, cash equivalents, and short-term investments used to fund operating expenses are impacted by the timing of when we pay or prepay these expenses. We expect our expenses to increase in connection with our ongoing activities, particularly as we expand our clinical programs, continue the research and development of, and seek marketing approval for our product candidates. In addition, if we obtain marketing approval for any of our product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution.

Because of the numerous risks and uncertainties associated with research, development and commercialization of pharmaceutical products, we are unable to estimate the exact amount of our operating capital requirements. Our future funding requirements will depend on many factors, including, but not limited to:

	●	the scope, timing, progress and results of discovery, pre-clinical development, laboratory testing and clinical trials for our product candidates;
	●	the costs of manufacturing our product candidates for clinical trials and in preparation for regulatory approval and commercialization;
	●	the extent to which we enter into collaborations or other arrangements with additional third parties in order to further develop our product candidates;
	●	the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending intellectual property-related claims;
	●	the costs and fees associated with the discovery, acquisition or in-license of additional product candidates or technologies;
	●	expenses needed to attract and retain skilled personnel;
	●	the costs associated with being a public company;
	●	the costs required to scale up our clinical, regulatory and manufacturing capabilities;
	●	the costs of future commercialization activities, if any, including establishing sales, marketing, manufacturing and distribution capabilities, for any of our product candidates for which we receive regulatory approval; and
	●	revenue, if any, received from commercial sales of our product candidates, should any of our product candidates receive regulatory approval.

As discussed above, on July 25, 2024, we were awarded an $8.0 million grant from CIRM to support the clinical development of chimeric antigen receptor T-cell therapy NXC-201 for the treatment of relapsed/refractory AL Amyloidosis. As of August 3, 2026, we have received $6.7 million in grant reimbursements under the grant agreement.

On June 3, 2025, we entered into the Citizens ATM Agreement, which was amended on March 25, 2026, , pursuant to which, effective March 25, 2026, the Company may offer and sell, from time to time, at its option, shares of its common stock, through Citizens, as the sales agent, having an aggregate offering price of up to $100,000,000 in an "at the market offering" as defined in Rule 415(a)(4) under the Securities Act. During the six months ended June 30, 2026 and 2025, we sold 1,510,000 and 513,935 shares of common stock pursuant to the Citizens ATM Agreement for net proceeds of $13,943,659 and $1,094,399, after offering expenses, respectively. As of August 3, 2026, the Company has sold an aggregate of 3,207,504 shares of common stock pursuant to the Citizens ATM Agreement for net proceeds of $18,353,089, after offering expenses.

In September 2025, we sold to certain accredited investors, in private placement transaction, pursuant to Securities Purchase Agreements (i) an aggregate of 3,915,604 shares of common stock, and (ii) non-transferable warrants to purchase up to an aggregate of 2,936,709 shares of common stock for gross proceeds of approximately $9.3 million, before deducting fees and offering expenses payable by us.

In December 2025, we conducted an underwritten public offering of 19,117,646 shares of our common stock, at a public offering price of $5.10 per share, and pre-funded warrants to purchase 490,196 shares of common stock, at a public offering price of $5.09 per pre-funded warrant, for net proceeds of approximately $93.7 million, after underwriting discounts and offering expenses.

In May 2026, we conducted an underwritten public offering (the "2026 Underwritten Offering") of 16,778,524 shares of our common stock, at a public offering price of $8.94 per share, for net proceeds of approximately $140.7 million, after underwriting discounts and offering expenses.

Material Cash Requirements

Our primary use of cash, cash equivalents and short-term investments is to fund operating expenses, which consist of clinical research and development expenses, manufacturing expenses, legal and compliance expenses, compensation and related expenses, and general overhead costs. Cash, cash equivalents and short-term investments used to fund operating expenses are impacted by the timing of when we pay or prepay these expenses. We expect our expenses to increase in connection with our ongoing activities, particularly as we expand our clinical programs, continue the research and development of, and seek marketing approval for our product candidates. In addition, if we obtain marketing approval for any of our product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution.

As of June 30, 2026, we had total assets of approximately $239.1 million and working capital of approximately $224.5 million. As of June 30, 2026, our liquidity included approximately $232.1 million of cash, cash equivalents, and short-term investments. In addition, we held approximately $2.1 million in U.S.-Treasury related long-term investments. We believe that our cash, cash equivalents, and short-term investments on hand as of the date of this report, will be sufficient to fund our planned operations over the 12-month period following the date of this report; however, there can be no assurance we will not need additional capital sooner. In addition, we believe that we will need additional capital to continue our planned operations beyond the 12-month period following the filing date of this Quarterly Report on Form 10-Q. We intend to seek additional funds through various financing sources, including the sale of our equity and debt securities, government or other third-party funding, commercialization, marketing and distribution arrangements, other collaborations, strategic alliances and licensing arrangements. In addition, we will consider alternatives to our current business plan that may enable us to achieve revenue producing operations and meaningful commercial success with a smaller amount of capital. However, there can be no guarantees that such funds will be available on commercially reasonable terms, if at all. If such financing is not available on satisfactory terms, we may be unable to further pursue our business plan and we may be unable to continue operations.

To the extent that we raise additional capital through the sale of equity or convertible debt securities, your ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a common stockholder. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making acquisitions or capital expenditures or declaring dividends. If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates, or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or other arrangements when needed, we may be required to delay, limit, reduce or terminate our research, product development or future commercialization efforts, or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

The continuation of the Company as a going concern is dependent upon its ability to obtain continued financial support from its stockholders, necessary equity financing to continue operations and the attainment of profitable operations.

In January 2024, the Company entered into a long-term operating lease agreement for biopharmaceutical manufacturing space in California under a non-cancelable operating lease that expires in December 2033. Under the terms of the lease, we expect to make total lease payments of approximately $1.3 million through December 2033.

We enter into contracts in the normal course of business with third-party contract organizations for preclinical and clinical studies, manufacture and supply of our preclinical and clinical materials and providing other services and products for operating purposes. Contracts for preclinical and clinical studies and other services generally provide for termination following a certain period after notice, and therefore we believe that our non-cancelable obligations under these agreements are not material. We do not have any long-term manufacturing and supply agreements with our third-party contract manufacturers, but we enter into specific contracts on an as needed basis for individual batch production runs.

Cash Flows

Cash used in operating activities

Net cash used in operating activities was $21,562,698 for the six months ended June 30, 2026 and $6,994,921 for the six months ended June 30, 2025. Net cash used for the six months ended June 30, 2026 was primarily related to our net loss of $21,643,689, offset by non-cash items of stock-based compensation expense of $1,553,705, depreciation expense of $182,570, right of use asset amortization of $79,080, loss on disposal of fixed assets of $34,153, slightly offset by realized gain on available-for-sale securities of $49,331. Operating activities also included a decrease in accounts payable and accrued expenses of $793,423 and an increase in prepaid expenses and other current assets of $854,551. Net cash used for the six months ended June 30, 2025, was primarily related to our net loss of $11,165,091, offset by non-cash items of stock-based compensation expense of $1,400,608, depreciation expense of $96,647 and right of use asset amortization of $42,368. Operating activities also included an increase in accounts payable and accrued expenses of $782,904, an increase in prepaid expenses of $145,953, and a decrease in the tax receivable of $2,025,564.

Cash used in investing activities

Net cash used in investing activities was $2,131,172 for the six months ended June 30, 2026, consisting of $12,317,643 in purchases of investments offset by $10,240,000 in proceeds from the sale of investments. In addition, there was $53,529 in purchases of property and operating equipment. Net cash used in investing activities was $195,343 for the six months ended June 30, 2025, consisting solely of purchase of property and equipment.

Cash provided by financing activities

Net cash provided by financing activities for the six months ended June 30, 2026 of $155,245,437 was mainly related to $140,722,254 from the sale of shares of our common stock in the 2026 Underwritten Offering, $14,037,289 from the sale of shares through the Citizens ATM Agreement in at-the-market offerings, $441,202 from cash proceeds received from the exercise of warrants and $44,692 from cash proceeds received from the exercise of common stock options. Net cash provided by financing activities for 2025 was primarily related to proceeds of $1,104,292 from the sale of common shares through an at-the-market offering.

JOBS Act

On April 5, 2012, the Jumpstart Our Business Startups Act (the "JOBS Act") was enacted. Section 107 of the 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 certain accounting standards until those standards would otherwise apply to private companies.

We have chosen to take advantage of the extended transition periods available to emerging growth companies under the JOBS Act for complying with new or revised accounting standards until those standards would otherwise apply to private companies provided under the JOBS Act. As a result, our financial statements may not be comparable to those of companies that comply with public company effective dates for complying with new or revised accounting standards.

Subject to certain conditions set forth in the JOBS Act, as an "emerging growth company," we intend to rely on certain of these exemptions, including, without limitation, (i) providing an auditor's attestation report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, as amended, and (ii) complying with the requirement adopted by the Public Company Accounting Oversight Board regarding the communication of critical audit matters in the auditor's report on financial statements. We will remain an "emerging growth company" until the earliest of (i) the last day of the fiscal year in which we have total annual gross revenues of $1.235 billion or more; (ii) the last day of our fiscal year following the fifth anniversary of the date of the completion of our initial public offering (December 31, 2026); (iii) the date on which we have issued more than $1 billion in nonconvertible debt during the previous three years; or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the SEC.

Critical Accounting Policies and Use of Estimates

Our financial statements are prepared in accordance with U.S. GAAP. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. Management regularly evaluates its estimates and judgments, including those related to revenue recognition, intangible assets, long-lived assets valuation, variable interest entities, and legal matters. Actual results may differ from these estimates which may be material. "Note 2 - Summary of Significant Accounting Policies" in Part I, Item 1 of this Quarterly Report on Form 10-Q and in the Notes to Condensed Consolidated Financial Statements in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2025 (the "2025 Form 10-K"), as filed with the SEC on March 25, 2026, and "Critical Accounting Policies" in Part II, Item 7 of the 2025 Form 10-K describe the significant accounting policies and methods used in the preparation of the Company's financial statements. There have been no material changes to the Company's critical accounting policies and estimates since the 2025 Form 10-K.