UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended June 30, 2026

 

OR

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from               to               

 

Commission File Number: 001-41294

 

Onconetix, Inc.

(Exact name of registrant as specified in its charter)

 

Delaware		83-2262816
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

 

201 E. Fifth Street, Suite 1900 Cincinnati, OH		45202
(Address of principal executive offices)		(Zip Code)

 

(513) 620-4101

(Registrant’s telephone number, including area code)

 

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of exchange on which registered
Common stock, $0.00001 par value		ONCO		The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

 

As of August 13, 2026, the registrant had 3,949,107 shares of common stock, $0.00001 par value per share, outstanding.

 

 

 

TABLE OF CONTENTS

 

		Page
Cautionary Note Regarding Forward-Looking Statements		ii
PART I.	FINANCIAL INFORMATION	1
Item 1.	Condensed Consolidated Financial Statements (unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations and Comprehensive Loss	2
	Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit)	3
	Condensed Consolidated Statements of Cash Flows	4
	Notes to Unaudited Condensed Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	38
Item 4.	Controls and Procedures.	38
PART II.	OTHER INFORMATION	40
Item 1.	Legal Proceedings.	40
Item 1A.	Risk Factors.	40
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	45
Item 3.	Defaults Upon Senior Securities.	45
Item 4.	Mine Safety Disclosures.	45
Item 5.	Other Information.	45
Item 6.	Exhibits.	46
	Signatures	47

 

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q (this “Report”) contains forward-looking statements that reflect our current expectations and views of future events. The forward-looking statements are contained principally in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Readers are cautioned that known and unknown risks, uncertainties and other factors, including those over which we may have no control and others listed in the “Risk Factors” section of this Report, may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements.

 

In some cases, you can identify forward-looking statements by the words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “objective,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue” and “ongoing,” or the negative of these terms, or other comparable terminology intended to identify statements about the future, although not all forward-looking statements contain these words. These statements relate to future events or our future financial performance or condition and involve known and unknown risks, uncertainties and other factors that could cause our actual results, levels of activity, performance, or achievement to differ materially from those expressed or implied by these forward-looking statements. These forward-looking statements include, but are not limited to, statements about:

 

●

our projected financial position and estimated cash burn rate;

 

●

our estimates regarding expenses, future revenues and capital requirements;

 

●

our ability to continue as a going concern;

 

●

our need to raise substantial additional capital to fund our operations and repay indebtness;

 

●

our ability to commercialize or monetize Proclarix and integrate the assets and commercial operations acquired in the share exchange with Proteomedix AG (“Proteomedix”);

 

●

our reliance on third parties, including Laboratory Corporation of America (“LabCorp”), to develop, market, distribute and sell Proclarix;

 

●

the successful development of our commercialization capabilities, including sales and marketing capabilities;

 

●

our ability to consummate the transaction on a timely basis as contemplated by the Share Exchange Agreement with Realbotix, LLC (“Realbotix” and the “Share Exchange Agreement” and the transactions contemplated therein, the “Realbotix Transaction”) and the anticipated benefits of the Realbotix Transaction;

 

●

our ability to maintain the necessary regulatory approvals to market and commercialize our product;

 

●

the results of market research conducted by us or others;

 

●

our ability to obtain and maintain intellectual property protection for our current product;

 

●

our ability to protect our intellectual property rights and the potential for us to incur substantial costs from lawsuits to enforce or protect our intellectual property rights;

 

 

●

the possibility that a third party may claim we or our third-party licensors have infringed, misappropriated, or otherwise violated their intellectual property rights and that we may incur substantial costs and be required to devote substantial time defending against claims against us;

 

●

our reliance on third parties, including manufacturers and logistics companies;

 

●

the success of competing therapies or diagnostics and products that are or become available;

 

●

our ability to successfully compete against current and future competitors;

 

●

our ability to expand our organization to accommodate potential growth and our ability to attract, motivate and retain key personnel;

 

●

the potential for us to incur substantial costs resulting from product liability lawsuits against us and the potential for these product liability lawsuits to cause us to limit our commercialization of our product;

 

●

market acceptance of our product, the size and growth of the potential markets for our current product, and our ability to serve those markets; and

 

●

disruptions in the business of Onconetix or Proteomedix, which could have an adverse effect on their respective businesses and financial results.

 

These forward-looking statements involve numerous risks and uncertainties. Although we believe that our expectations expressed in these forward-looking statements are reasonable, our expectations may later be found to be incorrect. Our actual results of operations or the results of other matters that we anticipate herein could be materially different from our expectations. Important risks and factors that could cause our actual results to be materially different from our expectations are generally set forth in “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and other sections in this Report. You should thoroughly read this Report and the documents that we refer to with the understanding that our actual future results may be materially different from and worse than what we expect. We qualify all our forward-looking statements by these cautionary statements.

 

The forward-looking statements made in this Report relate only to events or information as of the date on which the statements are made in this Report. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. You should read this Report and the documents that we refer to in this Report and have filed as exhibits to this Report, completely and with the understanding that our actual future results may be materially different from what we expect.

 

 

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

ONCONETIX, INC.
Condensed Consolidated Balance Sheets

 

		June 30,				December 31,
		2026				2025
		(Unaudited)
ASSETS
Current assets
Cash		$	5,942,249			$	5,220,654
Accounts receivable, net			2,351				296,866
Inventories			210,448				149,961
Investor receivable			—				50,000
Prepaid expenses and other current assets			362,762				349,293
Total current assets			6,517,810				6,066,774
Property and equipment, net			28,655				37,085
Deferred offering costs			225,000				225,000
Operating right of use asset			36,734				48,774
Goodwill			9,618,142				18,549,005
Total assets		$	16,426,341			$	24,926,638
LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable		$	1,844,861			$	1,757,695
Accrued expenses			249,607				341,881
Notes payable			150,394				—
Operating lease liability, current			24,419				24,412
Contingent warrant liabilities			25,378				26,590
Derivative liabilities			649,134				6,985,347
Total current liabilities			2,943,793				9,135,925
Operating lease liability, net of current portion			12,315				24,362
Total liabilities		$	2,956,108			$	9,160,287
Commitments and Contingencies
Series C Redeemable Preferred Stock, $0.00001 par value, 10,000 shares authorized, 7 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively			1,724				1,724
Stockholders’ equity
Common stock, $0.00001 par value, 250,000,000 shares authorized at June 30, 2026 and December 31, 2025; 3,793,676 and 31,201 shares issued at June 30, 2026 and December 31, 2025, respectively; 3,793,673 and 31,198 shares outstanding at June 30, 2026 and December 31, 2025, respectively			38				—
Series D Preferred Stock, $0.00001 par value, 32,000 shares authorized at June 30, 2026 and December 31, 2025; 8,156 and 16,325 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively.			—				—
Series E Preferred Stock, $0.00001 par value, 10,000 shares authorized at June 30, 2026 and December 31, 2025; 0 and 7,813 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively.			—				—
Additional paid-in capital			152,959,715				147,836,004
Treasury stock, at cost; 3 shares of common stock at June 30, 2026 and December 31, 2025			(625,791	)			(625,791	)
Accumulated deficit			(138,296,736	)			(131,214,558	)
Accumulated other comprehensive loss			(568,717	)			(231,028	)
Total stockholders’ equity			13,468,509				15,764,627
Total liabilities, convertible preferred stock, and stockholders’ equity			16,426,341			$	24,926,638

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

ONCONETIX, INC.
Condensed Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

 

		For the three months ended								For the six months ended
		June 30,				June 30,				June 30,				June 30,
		2026				2025				2026				2025
Revenue		$	17,120			$	106,494			$	38,577			$	208,124
Cost of revenue			12,817				35,991				35,929				91,789
Gross profit			4,303				70,503				2,648				116,335
Operating expenses
Selling, general, and administrative			2,245,653				1,523,591				4,284,981				3,197,797
Research and development			3,440				(111,670	)			54,258				(87,215	)
Impairment of goodwill			486,000				594,000				8,620,000				11,512,000
Total operating expenses			2,735,093				2,005,921				12,959,239				14,622,582
Loss from operations			(2,730,790	)			(1,935,418	)			(12,956,591	)			(14,506,247	)
Other (expense) income
Interest expense			(4,389	)			(223,097	)			(6,633	)			(446,689	)
Change in fair value of subscription agreement liability – related party			—				(191,038	)			—				3,127,962
Change in fair value of contingent warrant liabilities			(400	)			(229	)			1,212				(10,024	)
Change in fair value of Series D Derivative Liability			(136,471	)			—				3,819,307				—
Change in fair value of Series E Derivative Liability			—				—				2,072,590				—
Gain on forgiveness of accounts payable			—				—				—				944,694
Other income (loss)			4,747				(22,660	)			(12,063	)			(28,023	)
Total other income (loss)			(136,513	)			(437,024	)			5,874,413				3,587,920
Loss before income taxes			(2,867,303	)			(2,372,442	)			(7,082,178	)			(10,918,327	)
Net loss		$	(2,867,303	)		$	(2,372,442	)		$	(7,082,178	)		$	(10,918,327	)
Deemed dividend Series C preferred stock			—				(328,504	)			—				(1,498,595	)
Net loss applicable to common stockholders			(2,867,303	)			(2,700,946	)			(7,082,178	)			(12,416,922	)
Net loss per share, basic and diluted		$	(1.28	)		$	(237.91	)		$	(6.11	)		$	(1,583.19	)
Weighted average number of common shares outstanding, basic and diluted			2,242,770				11,353				1,158,993				7,843
Other comprehensive income (loss)
Net loss		$	(2,867,303	)		$	(2,372,442	)		$	(7,082,178	)		$	(10,918,327	)
Foreign currency translation			(127,517	)			1,882,464				(337,689	)			2,023,512
Change in pension benefit obligation			—				345,318				—				314,539
Total comprehensive loss		$	(2,994,820	)		$	(144,660	)		$	(7,419,867	)		$	(8,580,276	)

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 

 

 

ONCONETIX, INC.

Condensed Consolidated Statements of Convertible Preferred Stock and

Stockholders’ Equity (Deficit)
(Unaudited)

 

 

		Series A Preferred Stock								Common Stock								Additional Paid-in				Treasury Stock								Accumulated				Accumulated Other Comprehensive				Due from				Total Stockholders’
		Shares				Amount				Shares				Amount				Capital				Shares				Amount				Deficit				Income				Shareholders				Equity
Balance at December 31, 2024			—			$	—				2,768			$	—			$	127,825,744				(3	)		$	(625,791	)		$	(115,683,621	)		$	(2,723,397	)		$	(250,308	)		$	8,542,627
Issuance of common stock in connection with the ELOC			—				—				5,883				—				4,776,309				—				—				—				—				250,308				5,026,617
Stock-based compensation expense			—				—				—				—				29,256				—				—				—				—				—				29,256
Redemption of Series C Preferred Stock			—				—				—				—				—				—				—				(1,170,091	)			—				—				(1,170,091	)
Foreign currency translation adjustment			—				—				—				—				—				—				—				—				141,048				—				141,048
Change in pension benefit obligation			—				—				—				—				—				—				—				—				(30,779	)			—				(30,779	)
Net loss			—				—				—				—				—				—				—				(8,545,885	)			—				—				(8,545,885	)
Balance at March 31, 2025			—			$	—				8,651			$	—			$	132,631,309				(3	)		$	(625,791	)		$	(125,399,597	)		$	(2,613,128	)		$	—			$	3,992,793
Issuance of common stock in connection with the ELOC			—				—				6,702				—				1,365,038				—				—				—				—				—				1,365,038
Stock-based compensation expense			—				—				—				—				30,982				—				—				—				—				—				30,982
Cash in lieu of shares			—				—				(2	)			—				(926	)			—				—				—				—				—				(926	)
Redemption of Series C Preferred Stock			—				—				—				—				—				—				—				(328,504	)			—				—				(328,504	)
Settlement of subscription agreement liability			—				—				4,830				—				995,038				—				—				—				—				—				995,038
Foreign currency translation adjustment			—				—				—				—				—				—				—				—				1,882,464				—				1,882,464
Change in pension benefit obligation			—				—				—				—				—				—				—				—				345,318				—				345,318
Net loss			—				—				—				—				—				—				—				(2,372,442	)			—				—				(2,372,442	)
Balance at June 30, 2025			—			$	—				20,181			$	—			$	135,021,441				(3	)		$	(625,791	)		$	(128,100,543	)		$	(385,346	)		$	—			$	5,909,761

 

 

		Series D Preferred Stock								Series E Preferred Stock								Common Stock								Additional Paid-in				Treasury Stock								Accumulated				Accumulated Other Comprehensive				Total Stockholders’
		Shares				Amount				Shares				Amount				Shares				Amount				Capital				Shares				Amount				Deficit				Income				Equity
Balance at December 31, 2025			16,325			$	—				7,813			$	—				31,201			$	—				147,836,004				(3	)		$	(625,791	)		$	(131,214,558	)		$	(231,028	)		$	15,764,627
Stock-based compensation expense			—				—				—				—				—				—				22,305				—				—				—				—				22,305
Conversion of Series E Preferred Stock to Common Stock			—				—				(232	)			—				7,656				—				—				—				—				—				—				—
Conversion of Series D Preferred Stock to Common Stock			(6,373	)			—				—				—				222,265				2				(2	)			—				—				—				—				—
Issuance of Common Stock for warrant exercise			—				—				—				—				14,409				—				384,842				—				—				—				—				384,842
Cancellation of restricted common stock			—				—				—				—				(13	)			—				—				—				—				—				—				—
Cash in lieu of shares			—				—				—				—				(1	)			—				(250	)			—				—				—				—				(250	)
Foreign currency translation adjustment			—				—				—				—				—				—				—				—				—				—				(210,172	)			(210,172	)
Net loss			—				—				—				—				—				—				—				—				—				(4,214,875	)			—				(4,214,875	)
Balance at March 31, 2026			9,952			$	—				7,581			$	—				275,517			$	2				148,242,899				(3	)		$	(625,791	)		$	(135,429,433	)		$	(441,200	)		$	11,746,477
Stock-based compensation expense			—				—				—				—				—				—				7,359				—				—				—				—				7,359
Issuance of common stock in connection with the ELOC			—				—				—				—				2,704,126				27				4,265,248				—				—				—				—				4,265,275
Conversion of Series E Preferred Stock to Common Stock			—				—				(7,581	)			—				660,365				7				331,417				—				—				—				—				331,424
Conversion of Series D Preferred Stock to Common Stock			(1,796	)			—				—				—				153,712				2				112,890				—				—				—				—				112,892
Cancellation of restricted common stock			—				—				—				—				(26	)			—				—				—				—				—				—				—
Cash in lieu of shares			—				—				—				—				(18	)			—				(98	)			—				—				—				—				(98	)
Foreign currency translation adjustment			—				—				—				—				—				—				—				—				—				—				(127,517	)			(127,517	)
Net loss			—				—				—				—				—				—				—				—				—				(2,867,303	)			—				(2,867,303	)
Balance at June 30, 2026			8,156			$	—				—			$	—				3,793,676			$	38				152,959,715				(3	)		$	(625,791	)		$	(138,296,736	)		$	(568,717	)		$	13,468,509

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

ONCONETIX, INC.
Consolidated Statements of Cash Flows

(Unaudited)

 

		Six Months Ended June 30, 2026				Six Months Ended June 30, 2025
Cash flows from operating activities
Net loss		$	(7,082,178	)		$	(10,918,327	)
Adjustments to reconcile net loss to net cash used in operating activities:
Loss on impairment of goodwill			8,620,000				11,512,000
Amortization of debt discounts			—				4,966
Depreciation and amortization			8,030				8,447
Net periodic pension benefit			—				107,304
Stock-based compensation			29,664				60,238
Change in fair value of contingent warrant liabilities			(1,212	)			10,024
Change in fair value of subscription agreement liability - related party			—				(3,127,962	)
Gain on forgiveness of accounts payable			—				(944,694	)
Change in fair value of Series D derivative liability			(3,819,307	)			—
Change in fair value of Series E derivative liability			(2,072,590	)			—
Disposal of property and equipment			—				16,482
Changes in operating assets and liabilities:
Accounts receivable			312,185				15,685
Inventories			(64,593	)			(72,765	)
Investor receivable			50,000				—
Prepaid expenses and other current assets			(15,793	)			201,379
Accounts payable			87,337				(272,801	)
Accrued expenses			(91,091	)			(9,952	)
Net cash used in operating activities			(4,039,548	)			(3,409,976	)
Cash flows from investing activities			—				—
Net cash Provided by (used in) investing activities			—				—
Cash flows from financing activities
Proceeds from issuance of note payable			247,196				475,000
Principal payments of notes payable			(96,802	)			(1,537,331	)
Payment for redemption of Series C Preferred Stock			—				(1,713,570	)
Proceeds from exercise of warrants			384,842				—
Cash in lieu of shares			(348	)			(926	)
Proceeds from purchases of common stock in connection with the ELOC			4,265,275				6,391,655
Net cash provided by financing activities			4,800,163				3,614,828
Effect of exchange rate changes on cash			(39,020	)			(567,837	)
Net increase (decrease) in cash			721,595				(362,985	)
Cash, beginning of period			5,220,654				646,500
Cash, end of period		$	5,942,249			$	283,515
Supplemental disclosure of cash flow information:
Cash paid for interest		$	6,633			$	184,546
Noncash investing and financing activities:
D&O insurance premium financed		$	—			$	460,875
Deemed dividend owed to Series C preferred stock shareholders		$	—			$	409,510
Settlement of subscription agreement liability		$	—			$	995,038
Conversion of Series D preferred stock to common stock		$	112,892			$	—
Conversion of Series E preferred stock to common stock		$	331,424			$	—

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 1 — Organization and Basis of Presentation

 

Organization and Nature of Operations

 

Onconetix, Inc. (formerly known as Blue Water Biotech, Inc. and Blue Water Vaccines Inc.) (the “Company” or “Onconetix”) was formed on October 26, 2018, and is a commercial stage biotechnology company focused on the research, development, and commercialization of innovative solutions for oncology.

 

On December 15, 2023, Onconetix acquired 100% of the issued and outstanding voting equity interests in Proteomedix AG, a Swiss company (“Proteomedix” or “PMX”), and its related diagnostic product Proclarix. As a result of this transaction, Proteomedix became a wholly owned subsidiary of Onconetix. Proteomedix is a healthcare company whose mission is to transform prostate cancer diagnosis. Proteomedix has identified novel biomarker signatures with utility in prostate cancer diagnosis, prognosis and therapy management.

 

In April 2023, the Company acquired ENTADFI, a Food and Drug Administration (“FDA”)-approved, once daily pill that combines finasteride and tadalafil for the treatment of benign prostatic hyperplasia.

 

Historically, the Company’s focus was on the research and development of transformational vaccines to prevent infectious diseases worldwide, until the third quarter of 2023, at which time the Company halted its efforts on vaccine development activities to focus on commercialization activities for ENTADFI and pursue other potential acquisitions. 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 the ENTADFI assets were fully impaired at June 30, 2024 (see Notes 4 and 5).

 

On April 21, 2023, the Company filed an amendment to its Amended and Restated Certificate of Incorporation with the Secretary of State of Delaware to change its corporate name from “Blue Water Vaccines Inc.” to “Blue Water Biotech, Inc.” The name change was effective as of April 21, 2023. On December 15, 2023, the Company filed an amendment to its Amended and Restated Certificate of Incorporation with the Secretary of State of Delaware to change its corporate name from “Blue Water Biotech, Inc.” to “Onconetix, Inc.” In connection with each of the name changes, the Company also amended the Company’s bylaws to reflect the new corporate name.

 

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 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 May 21, 2026, the Company effected a reverse stock split of all shares of its issued and outstanding Common Stock at a ratio of one-for-ten (1:10). The Company accounted for the reverse stock split on a retrospective basis pursuant to 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.

 

5

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 1 — Organization and Basis of Presentation (cont.)

 

Basis of Presentation and Principles of Consolidation

 

The Company’s condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the accounts of Onconetix and its 100% wholly owned subsidiary, Proteomedix, since the acquisition date of December 15, 2023. All significant intercompany balances and transactions have been eliminated in consolidation.

 

Unaudited Interim Consolidated Financial Statements

 

The accompanying condensed consolidated balance sheet as of June 30, 2026, and the condensed consolidated statements of operations and comprehensive loss and the condensed consolidated statements of convertible preferred stock and stockholders’ equity (deficit) for the three and six months ended June 30, 2026 and 2025, and the condensed consolidated statements of cash flows for the six months ended June 30, 2026 and 2025 are unaudited. These unaudited interim consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, and in management’s opinion, include all adjustments, consisting of only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of June 30, 2026 and its results of operations and comprehensive loss for the three and six months ended June 30, 2026 and 2025, and its cash flows for the six months ended June 30, 2026 and 2025. The financial data and the other financial information disclosed in the notes to these condensed consolidated financial statements related to the three-month periods are also unaudited. Operating results for the three and six months ended June 30, 2026, are not necessarily indicative of the results that may be expected for the year ended December 31, 2026, any other interim periods, or any future year or period. The unaudited condensed consolidated financial statements included in this Report should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, which includes a broader discussion of the Company’s business and the risks inherent therein.

 

Note 2 — Going Concern and Management’s Plans

 

The Company’s operating activities to date have been devoted to seeking licenses, engaging in research and development activities, potential asset and business acquisitions, expenditures associated with the previously planned 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 June 30, 2026, the Company had cash of approximately $5.9 million, a working capital surplus of approximately $3.6 million and an accumulated deficit of approximately $138.3 million. During the six months ended June 30, 2026, the Company used approximately $4.0 million in cash for operating activities. In addition, as of August 10, 2026, the Company’s cash balance was approximately $5.4 million.

 

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 participation in strategic transactions and investments, including its proposed acquisition of Realbotix. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date of the issuance of these consolidated financial statements.

 

Management’s plans for funding the Company’s operations include advancing its strategic initiatives, including commercialization efforts related to Proclarix, and execution of recent and potential strategic transactions. Subsequent to June 30, 2026, on July 28, 2026, the Company entered into a securities purchase agreement pursuant to which it issued Series F Preferred Stock for aggregate gross proceeds of approximately $30.2 million and received net cash proceeds of approximately $0.25 million. Management has considered the impact of this financing, together with its ongoing efforts to obtain additional capital and improve operating cash flows, in evaluating the Company's ability to continue as a going concern. While the transaction provided additional liquidity, management believes that the Company will continue to require additional financing and/or improved operating results to fund its operations and satisfy its obligations as they become due.

 

Management also intends to pursue additional equity or debt financing to support operations and strategic initiatives. However, there are currently no committed sources of financing, and there is no assurance that additional funding will be available on favorable terms, if at all. This uncertainty raises significant concern about the Company’s ability to sustain operations and execute its strategic initiatives. If additional capital is not secured, the Company may need to curtail clinical trials, development, and commercialization efforts, and take further measures to reduce expenses to conserve cash.

 

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

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 3 — Summary of Significant Accounting Policies

 

During the six months ended June 30, 2026, there were no changes to the Company’s significant accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. Selected significant accounting policies are discussed in further detail below:

 

Fair Value Measurements

 

Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:

 

●

Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets;

 

●

Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and

 

●

Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

 

In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. Financial instruments, including cash, inventory, accounts receivable, accounts payable, accrued liabilities, operating lease liabilities, and notes payable are carried at cost, which management believes approximates fair value due to the short-term nature of these instruments.

 

The fair value of the contingent warrant liability and Series D and E derivative liabilities are valued using significant unobservable measures and other fair value inputs and are therefore classified as Level 3 financial instruments.

 

7

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 3 — Summary of Significant Accounting Policies (cont.)

 

The fair value of financial instruments measured on a recurring basis is as follows as of June 30, 2026 and December 31, 2025:

 

		As of June 30, 2026
Description		Total				Level 1				Level 2				Level 3
Liabilities:
Contingent warrant liabilities		$	25,378				—				—			$	25,378
Series D derivative liabilities		$	649,134				—				—			$	649,134
Total		$	674,512			$	—			$	—			$	674,512

  

		As of December 31, 2025
Description		Total				Level 1				Level 2				Level 3
Liabilities:
Contingent warrant liabilities		$	26,590				—				—			$	26,590
Series D and E derivative liabilities		$	6,985,347				—				—			$	6,985,347
Total		$	7,011,937			$	—			$	—			$	7,011,937

 

These non-financial assets had been valued using significant unobservable measures and other fair value inputs and were classified as Level 3 measurements.

 

None of the Company’s other non-financial assets or liabilities are recorded at fair value on a non-recurring basis as of June 30, 2026 and December 31, 2025. There were no transfers between levels during the periods presented.

  

New Accounting Pronouncements

 

There were no new accounting pronouncements issued since the Company’s filing of the Annual Report on Form 10-K for the year ended December 31, 2025, which could have a significant effect on the accompanying condensed consolidated financial statements.

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 4 — Balance Sheet Details

 

Inventories

 

Inventories, which primarily relate to Proclarix product as of June 30, 2026 and December 31, 2025, consisted of the following:

 

		June 30, 2026				December 31, 2025
Raw materials		$	94,525			$	103,431
Finished goods			115,923				46,530
Total		$	210,448			$	149,961

 

Prepaid Expenses and Other Current Assets

 

Prepaid expenses and other current assets consisted of the following as of June 30, 2026, and December 31, 2025:

 

		June 30, 2026				December 31, 2025
Prepaid insurance		$	217,244			$	136,739
VAT taxes receivable			40,217				31,955
Prepaid other			99,129				170,552
Other receivable			6,172				10,047
Total		$	362,762			$	349,293

 

Goodwill

 

Goodwill consisted of the following as of June 30, 2026 and December 31, 2025:

 

Balance as of December 31, 2025		$	18,549,005
Impairment loss			(8,134,000	)
Foreign currency translation			(211,532	)
Balance as of March 31, 2026		$	10,203,473
Impairment loss			(486,000	)
Foreign currency translation			(99,331	)
Balance as of June 30, 2026		$	9,618,142

 

9

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 4 — Balance Sheet Details (cont.)

 

Impairments for three and six months ended June 30, 2026 and 2025

 

During the three and six months ended June 30, 2026 and 2025, the Company’s stock price and market capitalization declined, and the Company determined that this was an indicator of a potential impairment of its goodwill. Accordingly, as of June 30, 2026 and 2025, the Company performed quantitative analysis to identify and measure the amount of impairment losses to be recognized. The Company recognized goodwill impairment losses of approximately $0.5 million and $0.6 million for the three months ended June 30, 2026 and 2025, respectively. The Company recognized goodwill impairment losses of approximately $8.6 million and $11.5 million for the six months ended June 30, 2026 and 2025, respectively.

 

The fair value of the reporting unit is estimated using a market approach. Beginning in the second quarter of 2024, the Company elected to use a market capitalization reconciliation methodology as its sole valuation technique in estimating the fair value of the reporting unit. Under this approach, the fair value of the reporting unit is determined based on the Company's market capitalization, calculated using the quoted market price of its common stock and outstanding shares, with consideration given to whether adjustments are necessary to reconcile market capitalization to the fair value of the reporting unit.

 

Accrued Expenses

 

Accrued expenses consisted of the following as of June 30, 2026 and December 31, 2025:

 

		June 30, 2026				December 31, 2025
Accrued compensation		$	14,884			$	42,228
Accrued professional fees			138,093				201,208
Other accrued expenses			16,630				18,445
Accrued franchise taxes			80,000				80,000
Total		$	249,607			$	341,881

 

Note 5 — Significant Agreements

 

Immunovia AB

 

On September 17, 2025, Proteomedix entered into a license agreement with Immunovia AB, pursuant to which Immunovia obtained exclusive rights to certain intellectual property and proprietary biological materials related to the PancreaSure™ test. In exchange for these rights, Immunovia paid Proteomedix a non-refundable upfront license fee of $0.3 million. 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. Accordingly, the Company recognized the $0.6 million as license revenue during the year ended December 31, 2025. Additionally, the agreement provided for a second payment of $0.3 million due by March 31, 2026, which was received during the six months ended June 30, 2026, and is no longer shown as a part of Accounts receivable, net on the consolidated balance sheet as of June 30, 2026.

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Notes 6 — Notes Payable

 

Insurance Financing

 

During the six months ended June 30, 2026, the Company obtained financing for certain Director & Officer liability insurance policy premiums. The agreement assigns the lender a first priority lien on and security interest in the financed policies and any additional premium required in the financed policies.

 

The total premiums, taxes and fees financed are approximately $0.3 million, with an annual interest rate of 8.5%. In consideration of the premium payment by the lender to the insurance companies or the agent or broker, the Company unconditionally promised to pay the lender the amount financed plus interest and other charges permitted under the agreement. At June 30, 2026, the Company recognized approximately $0.15 million as an insurance financing note payable, which is included in the current portion of notes payable in the accompanying condensed consolidated balance sheets. The Company will pay the insurance financing through monthly installment payments of approximately $25,693, with the last payment for the note due on December 17, 2026.

 

Note 7 — Subscription Agreement

 

On December 18, 2023, the Company entered into a subscription agreement (the “Subscription Agreement”) with the PMX Investor, who became a stockholder of Onconetix at the closing of the PMX Transaction, for the sale of 118 units, each comprised of 1 share of common stock and 0.30 pre-funded warrants (the “Units”) at $42,500 per Unit. The Subscription Agreement includes a make-whole provision (the “Make-Whole Provision”) which requires the issuance of additional shares of common stock in the event that the 270-day volume weighted average price after the closing of the Subscription Agreement, is below $42,500, and the PMX Investor still holds the common shares acquired upon closing of the Subscription Agreement 270 days after such closing. The Subscription Agreement would only close upon obtaining stockholder approval for certain transactions involving the Company’s Series B Preferred Stock. The Subscription Agreement was amended on January 23, 2024 to include a provision for interest on the $5 million debenture, accruing at a rate of 4%, to be included in the calculation of the units to be issued upon the conversion. Stockholder approval was obtained on September 5, 2024, and as a result, the conversion and the issuance of 118 units, attributable to the Subscription Agreement, and 3 units, attributable to additional accrued interest under the debenture to the PMX Investor took place on September 24, 2024.

 

As of June 30, 2026 and December 31, 2025, the fair value of the related party subscription agreement liability was $0. For the three and six months ended June 30, 2025, the Company recognized a change in fair value of the related party subscription agreement liability of approximately $191,000 and $3,128,000. No gain or loss related to changes in the fair value of the related party subscription liability was recognized during the three and six months ended June 30, 2026, as the liability was settled in the prior year.

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 8 — Warrant and derivative liabilities

 

Contingent warrant liabilities

 

The following table summarizes the activity for the contingent warrant liabilities, using unobservable Level 3 inputs, for the three and six months ended June 30, 2026:

 

		Contingent Warrant Liability
Balance at December 31, 2025			26,590
Change in fair value			(1,612	)
Balance at March 31, 2026		$	24,978
Change in fair value			400
Balance at June 30, 2026		$	25,378

 

Series D derivative liabilities and warrant liabilities

 

On September 22, 2025, the Company completed a private placement transaction with institutional investors, resulting in the issuance of Series D convertible preferred stock and accompanying warrants to purchase shares of common stock. In connection with the Series D PIPE Financing, the Company recorded warrant liabilities related to the Series D Warrants and derivative liabilities associated with certain embedded features in the Series D Preferred Stock. These instruments were classified as liabilities and measured at fair value in accordance with ASC 815 due to their settlement provisions and other contractual terms. Refer to Note 9 for further details on the private placement transaction.

 

The Company measured its bifurcated embedded derivative liabilities and warrant liabilities as of June 30, 2026, December 31, 2025 and September 22, 2025, at fair value on a recurring basis using level 3 inputs. These financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment and estimation. The derivative liabilities and warrant liabilities were both measured using Monte Carlo valuation models. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates.

 

As of December 11, 2025, the Company had entered a letter of intent with Realbotix (“LOI”), which contemplates a change of control transaction. A closing condition of the LOI is that no convertible securities of the Company will be outstanding prior to, or upon, closing (subject to approval of the preferred shareholders) which creates two distinct timing scenarios for the settlement of the preferred securities: prior to, or at closing, pursuant to the terms of the LOI or after closing in the event the transaction proposed by the LOI is not completed. Given the disparate timing conditions, the valuation included two scenarios in the Monte Carlo valuation analysis as of December 31, 2025: Closing and No Closing. The Closing scenario includes settlement logic for the preferred securities based on the profit-maximizing outcome of the preferred shareholder at the hypothetical closing date. The No Closing scenario models the embedded derivatives as if there was no forced conversion event (similar to valuation analyses of the embedded derivatives as of their original issuance and September 30, 2025).

 

As of June 30, 2026, the Company refined its valuation technique for the No Closing Scenario to explicitly incorporate the probability that the Company will have sufficient funding to continue operations over the applicable term. This refinement considers the Company’s cash position, projected operating cash requirements, and its ability to access remaining capacity under its equity line of credit facility and reflects the increasing significance of these funding considerations as the Company’s cash position and available financing alternatives have evolved.

 

The table below shows the inputs used to determine the fair value of the derivative liabilities:

 

		As of
		June 30,				June 30,				December 31,				December 31,
		2026				2026				2025				2025
		Closing Scenario				Non-closing Scenario				Closing Scenario				Non-closing Scenario
Expected term (years)			2.23				2.23				2.75				2.73
Expected volatility			150.00	%			150.00	%			150.00	%			150.00	%
Expected dividend yield			0.00	%			0.00	%			0.00	%			0.00	%
Risk-free interest rate			4.12	%			4.12	%			3.50	%			3.50	%
Probability			40.00	%			60.00	%			40.00	%			60.00	%
Probability of Survival			—	%			25.00	%			—	%			—	%

 

The Limited Waiver Agreement executed on December 23, 2025 resulted in reclassification of the warrants to equity, the warrant liability was remeasured using inputs as of December 23, 2025, and no subsequent liability remeasurement was required through December 31, 2025.

 

12

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 8 — Warrant and derivative liabilities (cont.)

 

The following table presents information about the Company’s derivative liabilities that are measured at fair value on a recurring basis as of June 30, 2026 and December 31, 2025, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

 

		Valuation Level		June 30, 2026				December 31, 2025
Derivative liabilities		Level 3			649,134				4,581,333
				$	649,134			$	4,581,333

 

The following table sets forth a summary of the change in the fair value of the derivative liabilities that are measured at fair value on a recurring basis for the six months ended June 30, 2026:

 

		Derivative Liabilities
Balance, as of December 31, 2025		$	4,581,333
Change in fair value			(3,955,778	)
Balance, as of March 31, 2026			625,555
Change in fair value			136,471
Conversion			(112,892	)
Balance, as of June 30, 2026		$	649,134

 

Series E derivative liabilities and warrant liabilities

 

On October 1, 2025, the Company completed a private placement transaction with institutional investors, resulting in the issuance of Series E convertible preferred stock and accompanying warrants to purchase shares of common stock. In connection with the Series E PIPE financing, the Company recorded warrant liabilities related to the Series E Warrants and derivative liabilities associated with certain embedded features in the Series E Preferred Stock. These instruments were classified as liabilities and measured at fair value in accordance with ASC 815 due to their settlement provisions and other contractual terms. Refer to Note 9 for further detail on the private placement transaction.

 

The Company measures its bifurcated embedded derivative liability and warrant liability as of June 30, 2026, December 31, 2025 and issuance, at fair value on a recurring basis using level 3 inputs. These financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. The derivative liability and warrant liability were both measured using Monte Carlo valuation models. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates.

 

As of December 11, 2025, the Company had entered a letter of intent with Realbotix (“LOI”), which contemplates a change of control transaction. A closing condition of the LOI is that no convertible securities of the Company will be outstanding prior to, or upon, closing (subject to approval of the preferred shareholders) which creates two distinct timing scenarios for the settlement of the preferred securities: prior to, or at closing, pursuant to the terms of the LOI or after closing in the event the transaction proposed by the LOI is not completed. Given the disparate timing conditions, the valuation included two scenarios in the Monte Carlo valuation analysis as of June 30, 2026 and December 31, 2025: Closing and No Closing. The Closing scenario includes settlement logic for the preferred securities based on the profit-maximizing outcome of the preferred shareholder at the hypothetical closing date. The No Closing scenario models the embedded derivatives as if there was no forced conversion event (similar to valuation analyses of the embedded derivatives as of their original issuance and September 30, 2025).

 

13

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 8 — Warrant and derivative liabilities (cont.)

 

The table below shows the inputs used to determine the fair value of the derivative liabilities:

 

		As of
		June 30,				June 30,				December 31,				December 31,
		2026				2026				2025				2025
		Closing Scenario				Non-closing Scenario				Closing Scenario				Non-closing Scenario
Expected term (years)			2.25				2.25				2.73				2.75
Expected volatility			150.00	%			150.00	%			150.00	%			150.00	%
Expected dividend yield			0.00	%			0.00	%			0.00	%			0.00	%
Risk-free interest rate			4.12	%			4.12	%			3.50	%			3.50	%
Probability			40.00	%			60.00	%			40.00	%			60.00	%

 

The Limited Waiver Agreement executed on December 23, 2025 resulted in reclassification of the warrants to equity, the warrant liability was remeasured using inputs as of December 23, 2025, and no subsequent liability remeasurement was required through December 31, 2025.

 

The following table presents information about the Company’s derivative liabilities that are measured at fair value on a recurring basis as of June 30, 2026 and December 31, 2025, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

 

		Valuation Level		June 30, 2026				December 31, 2025
Derivative liabilities		Level 3			—				2,404,014
				$	—			$	2,404,014

 

The following table sets forth a summary of the change in the fair value of the derivative liabilities that are measured at fair value on a recurring basis for the six months ended June 30, 2026:

 

		Derivative Liabilities
Balance, as of December 31, 2025		$	2,404,014
Change in fair value			(2,072,590	)
Balance, as of March 31, 2026			331,424
Conversions			(331,424	)
Balance, as of June 30, 2026		$	—

 

Note 9 — Convertible Preferred Stock and Stockholders’ Equity

 

Authorized Capital

 

As of June 30, 2026 and December 31, 2025, the Company is authorized to issue 250,000,000 shares and 10,000,000 shares of common stock and preferred stock, respectively, with a par value of $0.00001 for both common stock and preferred stock.

 

At June 30, 2026 and December 31, 2025, the Company had designated 1,150,000 shares, 10,000 shares, 2,700,000 shares, 10,000 shares, 32,000 shares, and 10,000 shares of Series Seed Preferred Stock, Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, and Series E Preferred Stock, respectively.

 

14

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 9 — Convertible Preferred Stock and Stockholders’ Equity (cont.)

 

Preferred Stock

 

Series Seed Convertible Preferred Stock

 

The Company has 1,150,000 shares of preferred stock designated as Series Seed Preferred Stock (“Series Seed”) and there are no shares of Series Seed outstanding as of June 30, 2026 and December 31, 2025.

 

Series A Convertible Preferred Stock

 

On September 29, 2023, the Company filed a Certificate of Designations of Rights and Preferences of Series A Preferred Stock of the Company (the “Series A Certificate of Designations”) with the State of Delaware to designate and authorize the issuance of up to 10,000 shares of Series A Preferred Stock.

 

On October 3, 2023, the Company issued 3,000 shares of Series A Convertible Preferred Stock in exchange for the settlement of $3.0 million in notes payable due to Veru, Inc.

 

On September 24, 2024, Veru converted all 3,000 shares of Series A Convertible Preferred Stock into 33 shares of the Company’s common stock per the stated conversion ratio. There were 0 shares of Series A Convertible Stock outstanding as of June 30, 2026 and December 31, 2025.

 

Series B Convertible Preferred Stock

 

In connection with the PMX acquisition on December 15, 2023, the Company issued 2,696,729 shares of Series B Convertible Preferred Stock, which were initially convertible into approximately 1,586 shares of common stock, subject to stockholder approval on September 5, 2024. All Series B Preferred Stock was fully converted into common stock on September 24, 2024. As of June 30, 2026 and December 31, 2025, no Series B Preferred Stock remains outstanding.

  

Series C Convertible Preferred Stock

 

On October 1, 2024, the Board of Directors authorized the Company to create a series of 10,000 shares of preferred stock designated as “Series C Convertible Preferred Stock”, with a par value of $0.00001, pursuant to the certificate of designations. At any time after the initial issuance date of Series C convertible Preferred Stock, each Preferred Share shall be convertible into validly issued, fully paid and non-assessable shares of Common Stock. The holders of Series C Preferred Stock are entitled to dividends, on an as-if converted basis, equal to and in the same form as dividends actually paid on shares of Common Stock, when and if actually paid. In addition, from and after the occurrence and during the continuance of any Triggering Event, dividends (“Default Dividends”) will accrue on the Stated Value of each Preferred Share at a rate of fifteen percent (15.0%) (the “Default Rate”) per annum. Each holder is entitled to convert any portion of the outstanding Preferred Shares held by such holder into validly issued, fully paid and non-assessable Conversion shares at the Conversion Rate, which can be determined by dividing (x) the Conversion Amount of such Preferred Share by (y) the Conversion Price, $225.28, subject to adjustment as provided in the Certificate of Designations.

 

On July 16, 2025, the Company exercised its voluntary Series C Preferred Stock adjustment right to lower the conversion price of the Series C Preferred Stock to $175, and holders of 1,920 shares of Series C Preferred Stock agreed to convert their shares into shares of Common Stock. During the year ended December 31, 2025, 1,369 shares of Series C Preferred Stock were redeemed for an aggregate amount of $1.71 million, 1,920 shares of Series C Preferred Stock were converted into common stock and 203 shares of Series C Preferred Stock were exchanged into 244 shares of Series D Preferred Stock (as defined below). As of June 30, 2026 and December 31, 2025, 7 shares of Series C Preferred Stock remain outstanding, with a carrying value of $1.7 thousand, as reflected in the accompanying consolidated balance sheet.

 

15

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 9 — Convertible Preferred Stock and Stockholders’ Equity (cont.)

 

Series D Preferred Stock

 

On September 22, 2025, the Company entered into a securities purchase agreement (the “Series D Securities Purchase Agreement” and the financing contemplated therein, the “Series D PIPE Financing”) 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 872,567 shares of Common Stock, (the Series D Preferred Stock together with the Series D Warrants, the “Series D PIPE Securities”), 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 $0.9716, and the Series D Warrants are exercisable beginning on the issuance date and expire on the third anniversary of the issuance date.

 

The Series D Preferred Stock was determined to be more akin to an equity-like host than a debt-like host and was classified as permanent equity as it was not redeemable in any manner that would require classification outside of permanent equity pursuant to ASC 480-10-S99. The Series D Preferred Stock was recorded on the accompanying consolidated balance sheet at its par value. Certain embedded share-settled redemption features within the Series D Preferred Stock were bifurcated and accounted for separately a derivative liability.

 

The Series D Warrants and certain embedded share-settled redemption features of the Series D Preferred Stock issued were determined to be liability-classified instruments pursuant to ASC 480 and ASC 815. The embedded features of the Series D Preferred Stock were bifurcated and accounted for separately as derivative liabilities. The Company measured the warrant liabilities and bifurcated derivative liabilities at fair value on a recurring basis using Level 3 inputs as of September 22, 2025 (the issuance date), December 23, 2025 (amended warrants date), December 31, 2025 (derivative liabilities fair value date) and June 30, 2026, respectively. See Note 8 for further information regarding the valuation methodology and assumptions used in determining the fair value of the warrant and derivative liabilities.

 

The Series D Preferred Stock has no voting rights. The Series D Preferred Stock are convertible into common stock at the election of the holders of the Series D Preferred Stock at any time at an initial conversion price of $184.45 per share. The conversion price is subject to customary adjustments for stock dividends, stock splits, reclassifications, stock combinations and the like (subject to certain exceptions), anti-dilution provisions, and a floor price of $0.5322.

 

The Series D Preferred Stock is not redeemable by the holder except in the event of 1) a liquidation, dissolution, or winding up, or 2) the Series D Preferred Stock is redeemable for common stock of the Company upon the occurrence of a change in control. Holders of the Series D Preferred Stock shall be entitled to receive dividends as authorized and declared by the Company’s Board of Directors, payable in cash, securities, or in other assets as determined by the Company’s Board of Directors.

 

In the event of the Company’s liquidation, dissolution, or winding up, holders of the Series D Preferred Stock will be entitled to receive out of the assets, whether capital or surplus, an amount equal to the stated value of the Series D Preferred Stock, plus any accrued and unpaid dividends thereon and any other fees or liquidated damages owed before any distribution or payment shall be made to the holders of any junior securities.

 

During the six months ended June 30, 2026, holders of Series D Preferred Stock converted 8,169 shares into 375,977 shares of common stock. As of June 30, 2026 and December 31, 2025, 8,156 and 16,325 shares of Series D Preferred Stock remain outstanding, respectively.

 

Series E Preferred Stock

 

On October 1, 2025, Onconetix entered into, and sold to institutional investor(s) (collectively, the “PIPE Investors”), pursuant to a securities purchase agreement (the “Securities Purchase Agreement”) 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 (the “Common Stock”) and warrants to purchase 405,045 shares of Common Stock (the “Warrants” and, together with the Series E Preferred Stock, the “PIPE Securities”), for an aggregate purchase price of approximately $6.25 million and net cash proceeds of $6.2 million. Such investment is referred to as the “PIPE Financing”. The exercise price of the Series E Warrants is $0.9716, and the Series E Warrants are exercisable beginning on the issuance date and expire on the third anniversary of the issuance date.

 

16

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 9 — Convertible Preferred Stock and Stockholders’ Equity (cont.)

 

The Series E Preferred Stock was determined to be more akin to an equity-like host than a debt-like host and was classified as permanent equity as it was not redeemable in any manner that would require classification outside of permanent equity pursuant to ASC 480-10-S99. The Series E Preferred Stock was recorded on the accompanying consolidated balance sheet at its par value. Certain embedded share-settled redemption features within the Series E Preferred Stock were bifurcated and accounted for separately a derivative liability.

 

The Series E Warrants and certain embedded share-settled redemption features of the Series E Preferred Stock issued were determined to be liability-classified instruments pursuant to ASC 480 and ASC 815. The embedded features of the Series E Preferred Stock were bifurcated and accounted for separately as derivative liabilities. The Company measured the warrant liabilities and bifurcated derivative liabilities at fair value on a recurring basis using Level 3 inputs as of October 1, 2025 (the issuance date), December 23, 2025 (amended warrants date) and December 31, 2025 (derivative liabilities fair value date), and June 30, 2026. See Note 8 for further information regarding the valuation methodology and assumptions used in determining the fair value of the warrant and derivative liabilities.

  

The Series E Preferred Stock has no voting rights. The Series E Preferred Stock are convertible into common stock at the election of the holders of the Series E Preferred Stock at any time at an initial conversion price of $192.88 per share. The conversion price is subject to customary adjustments for stock dividends, stock splits, reclassifications, stock combinations and the like (subject to certain exceptions), anti-dilution provisions, and a floor price of $0.298.

 

The Series E Preferred Stock is not redeemable by the holder except in the event of 1) a liquidation, dissolution, or winding up, or 2) the Series E Preferred Stock is redeemable for common stock of the Company upon the occurrence of a change in control. Holders of the Series E Preferred Stock shall be entitled to receive dividends as authorized and declared by the Company’s Board of Directors, payable in cash, securities, or in other assets as determined by the Company’s Board of Directors.

 

In the event of the Company’s liquidation, dissolution, or winding up, holders of the Series E Preferred Stock will be entitled to receive out of the assets, whether capital or surplus, an amount equal to the stated value of the Series E Preferred Stock, plus any accrued and unpaid dividends thereon and any other fees or liquidated damages owed before any distribution or payment shall be made to the holders of any junior securities.

 

As of December 31, 2025, all 7,813 shares of Series E Preferred Stock remained outstanding. As of June 30, 2026, all 7,813 shares of Series E Preferred Stock were converted into 668,021 shares of Common Stock.

 

October 2024 ELOC

  

Concurrently, on October 2, 2024, the Company entered into a Common Stock Equity Line of Credit Purchase Agreement (the “October 2024 ELOC Purchase Agreement”) with an institutional investor (the “October 2024 ELOC Investor”), whereby the Company may sell up to $25,000,000 of the Company’s new issued Common Stock. Pursuant to the October 2024 ELOC Purchase Agreement, the October 2024 ELOC Investor shall purchase from the Company up to the lesser of (i) $25.0 million in shares of our Common Stock and (ii) 390 shares, representing 19.99% of the total number of shares of Common Stock outstanding immediately prior to the execution of the October 2024 ELOC Purchase Agreement. Pursuant to the October 2024 ELOC Purchase Agreement, 30% of the gross proceeds to the Company from any sale of common stock thereunder must be applied towards the redemption of the Series C Redeemable Preferred Stock.

  

During the three months ended June 30, 2026 and 2025, the Company received proceeds of $4.3 million and $1.4 million under the ELOC, respectively. During the six months ended June 30, 2026 and 2025, the Company received proceeds of $4.3 million and $6.4 million under the ELOC, respectively.

 

Common Stock

 

As of June 30, 2026 and December 31, 2025 there were 3,793,676 and 31,201 shares of common stock issued, respectively, and 3,793,673 and 31,198 shares of common stock outstanding, respectively.

 

17

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 9 — Convertible Preferred Stock and Stockholders’ Equity (cont.)

  

Treasury Stock

 

On November 10, 2022, the Board approved a stock repurchase program (the “Repurchase Program”) to allow the Company to repurchase up to 125,000 shares of common stock with a maximum price of $1.00 per share, with discretion to management to make purchases subject to market conditions. On November 18, 2022, the Board approved an increase to the maximum price to $2.00 per share. There was no expiration date for this program and prices are not adjusted for the reverse stock split to comply with the program.

 

There were no repurchases of common stock during the six months ended June 30, 2026 and 2025.

 

On November 13, 2024, the Board terminated the Repurchase Program.

 

Warrants

 

The following summarizes the Company’s outstanding warrants, excluding contingent warrants issuable upon exercise of the outstanding warrants as of June 30, 2026:

 

		Number of Shares				WA Average Exercise Price				WA Remaining Contractual Life (in years)
Outstanding as of December 31, 2025			24,608,745				248.50				2.73
Granted			—				—				—
Exercised			(396,090	)			—				—
Cancelled			—				—				—
Outstanding as of March 31, 2026			24,212,655				262.55				2.49
Granted			—				—				—
Exercised			—				—				—
Cancelled			—				—				—
Outstanding as of June 30, 2026			24,212,655				1.27				2.24
Warrants vested and exercisable as of June 30, 2026			24,212,655				1.27				2.24

 

As of June 30, 2026, the Company had outstanding warrants, which are exercisable into 24,212,655 shares of common stock. The shares of common stock underlying the outstanding warrants had an exercise price of $1.27 per share, based on the closing trading price on June 30, 2026.

 

On May 21, 2026, the Company effected a 1-for-10 reverse stock split of its common stock. The Series D and Series E warrants contain anti-dilution provisions that require adjustments to the exercise price and the number of shares underlying the warrants upon the occurrence of specified events. Pursuant to these provisions, following the reverse stock split, the exercise price of the affected warrants was adjusted based on the lowest volume weighted average price ("VWAP") of the Company's common stock during the 16 trading-day period following the reverse stock split, resulting in an adjusted exercise price of $0.9716 per share.

 

As a result of this price-reset feature, the anti-dilution adjustment increased the number of shares issuable upon exercise of the affected warrants after giving effect to the reverse stock split, rather than decreasing solely in proportion to the reverse stock split ratio. Based on the adjusted exercise price, the Company determined that an aggregate of 24,212,379 net Series D and E warrants became issuable after accounting for this adjustment.

 

Contingent Warrant Liabilities

 

As of June 30, 2026, the fair value of contingent warrant labilities includes the Series C warrants of $5,100 and those issuable upon exercise of the Inducement PIOs of approximately $20,278 totaling $25,378 included as contingent warrant liabilities in the accompanying condensed consolidated balance sheets.

 

As of December 31, 2025, the fair value of contingent warrant labilities includes the Series C Warrants of $6,300 and those issuable upon exercise of the Inducement PIOs of approximately $20,290 totaling $26,590 included as contingent warrant liabilities in the accompanying consolidated balance sheets.

 

18

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 9 — Convertible Preferred Stock and Stockholders’ Equity (cont.)

 

Onconetix Equity Incentive Plans

 

The Company’s 2019 Equity Incentive Plan (the “2019 Plan”) was adopted by its board of directors and by its stockholders on July 1, 2019. On February 23, 2022 the Company’s board of directors adopted the Company’s 2022 Equity Incentive Plan (the “2022 Plan”), which is the successor and continuation of the Company’s 2019 Plan. Under the 2022 Plan, the Company may grant stock options, restricted stock, restricted stock units, stock appreciation rights, and other forms of awards to employees, directors, and consultants of the Company. In May 2023, the number of shares of common stock reserved for issuance under the 2022 Plan was increased to 18, and in September 2024, the number of shares of common stock reserved for issuance under the 2022 Plan was increased to 341. Stock-based awards granted during the six months ended June 30, 2025 were all granted under the 2022 Plan. There were no stock-based awards granted during the six months ended June 30, 2026. As of June 30, 2026, there are 208 shares available for issuance under the 2022 Plan.

 

Stock Options

 

There were no stock options granted during the three and six months ended June 30, 2026 and 2025.

 

The aggregate fair value of stock options that vested during the three and six months ended June 30, 2026, was approximately $0 and $0, respectively, compared to $46,000 and $92,000 for the same periods in 2025.

 

Restricted Stock

 

The following summarizes activity related to the Company’s restricted stock awards granted under the 2022 Plan for the six months ended June 30, 2026:

 

						Weighted
						Average
		Number of				Grant Date
		Shares				Fair Value
Nonvested as of December 31, 2025			39			$	715.50
Granted			—				—
Vested			—				—
Forfeited			(13	)			986.20
Nonvested as of March 31, 2026			26			$	579.20
Granted			—				—
Vested			—				—
Forfeited			(26	)			579.20
Nonvested as of June 30, 2026			—			$	—

 

Proteomedix Stock Option Plan

 

Proteomedix sponsors a stock option plan (the “PMX Option Plan”) which provides common stock option grants to be granted to certain employees and consultants, as was determined by the board of directors of Proteomedix. In connection with the PMX Transaction, the Company assumed the PMX Option Plan.

 

Generally, options issued under the PMX Option Plan have a term of not more than 11 years and provide for a four-year vesting period. Stock options issued under the PMX Option Plan are measured at fair value using the Black-Scholes option pricing model.

 

19

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 9 — Convertible Preferred Stock and Stockholders’ Equity (cont.)

 

There was no activity under the PMX Option Plan for the six months ended June 30, 2026 and 2025. As of June 30, 2026 and December 31, 2025, there were no outstanding stock options.

 

Stock-Based Compensation

 

Stock-based compensation expense related to stock options and restricted stock, for the three and six months ended June 30, 2026 and 2025 was as follows:

 

		For the Three Months Ended June 30,
		2026				2025
Selling, general and administrative		$	7,359			$	30,982
Research and development			—				—
Total		$	7,359			$	30,982

 

		For the Six Months Ended June 30,
		2026				2025
Selling, general and administrative		$	29,664			$	60,238
Research and development			—				—
Total		$	29,664			$	60,238

 

Note 10 — Commitments and Contingencies

 

Office Lease

 

Proteomedix leases office and lab space in Zurich Switzerland. In May 2025, Proteomedix entered into a lease amendment to reduce its leased premises. Effective June 30, 2025, the Company terminated the April 2024 lease amendment, which included office space and laboratory space. Additionally, a partial termination of a prior lease amendment further reduced the office space.

 

This lease expired on December 31, 2025, and was renewed for a successive two-year term, resulting in an additional right-of-use asset and lease liability of approximately $49,000. The lease, as renewed, requires payments of approximately $24,000 over the next twelve months. The lease will automatically renew for successive two-year terms, unless terminated. Either party may terminate the lease with twelve months’ written notice.

 

Litigation

 

From time to time, the Company may be subject to various legal proceedings and claims that arise in the ordinary course of its business activities. As of June 30, 2026, the Company is not a party to any material legal proceedings and is not aware of any pending or threatened claims.

 

Indemnification

 

In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future but have not yet been made. To date, the Company has not been required to defend any action related to its indemnification obligations. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is not estimable at this time.

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 11 — Related Party Transactions

 

On June 17, 2025, the Company entered into a separate consulting agreement with a firm affiliated with Dr. Meier. The agreement provides for the payment of certain success fees and reimbursement of related expenses. Under its terms, Dr. Meier is entitled to earn up to 10% of success fees for transactions greater than $9 million earned by the affiliated firm, payable only upon receipt of such proceeds. The Company recorded approximately $0 in related expenses during the six months ended June 30, 2026 and 2025. As of June 30, 2026 and December 31, 2025 approximately $16,500 related to this agreement was included in accounts payable.

 

Note 12 — Net Loss Per Share

 

Basic net loss per share is computed by dividing the net income or loss applicable to common shares by the weighted average number of common shares outstanding during the period. The weighted average number of shares of common stock outstanding includes pre-funded warrants because their exercise requires only nominal consideration for delivery of shares; it does not include any potentially dilutive securities or any unvested restricted shares of common stock. Certain restricted shares, although classified as issued and outstanding at June 30, 2026, are considered contingently returnable until the restrictions lapse and will not be included in the basic net loss per share calculation until the shares are vested. Unvested shares of the Company’s restricted stock do not contain non-forfeitable rights to dividends and dividend equivalents.

 

The two-class method is used to determine earnings per share based on participation rights of participating securities in any undistributed earnings. Each share of preferred stock that includes rights to participate in distributed earnings is considered a participating security and the Company uses the two-class method to calculate net income available to the Company’s common stockholders per common share — basic and diluted.

 

The following securities were excluded from the computation of diluted shares outstanding due to the losses incurred in the periods presented, as they would have had an anti-dilutive impact on the Company’s net loss:

 

		As of June 30,
		2026				2025
Options to purchase shares of common stock			—				3
Warrants			24,212,655				276
Unvested shares of restricted stock			—				4
Common stock issuable upon conversion of Series C Redeemable Preferred Stock			38				7,992
Common stock issuable upon conversion of Series D Redeemable Preferred Stock			15,325,066				—
Total			39,537,759				8,275

 

Note 13 — Segment Information

 

The Company conducts its business activities and reports financial results as one business segment. The presentation of financial results as one reportable segment is consistent with the way the Company operates its business and is consistent with the manner in which the Chief Operating Decision Maker (“CODM”) evaluates performance and makes resource and operating decisions for the business. The Company’s CODM is the Chief Executive Officer. Furthermore, the Company notes that monitoring financial results as one reportable segment helps the CODM manage costs on a consolidated basis, consistent with the integrated nature of the operations. The CODM uses net loss, as reported on the Consolidated Statements of Operations and Comprehensive Loss, in evaluating performance of the Company and determining how to allocate resources of the Company as a whole. The CODM reviews consolidated financial information and does not regularly review discrete expense categories or other significant segment expenses apart from the information presented in the consolidated statement of operations and other disclosures included in the consolidated financial statements. As the CODM evaluates performance on a consolidated basis, all required financial segment information is included in the consolidated financial statements.

 

21

 

 

ONCONETIX, INC.
Notes to Condensed Consolidated Financial Statements

June 30, 2026

(Unaudited)

 

Note 13 — Segment Information (cont.)

 

Geographic Information

 

The distribution of revenue by geographical area was as follows:

 

		Three Months Ended June 30,
		2026				2025
United States		$	—			$	—
United Kingdom			6,798				2,281
Switzerland			10,322				104,213
Total		$	17,120			$	106,494

 

		Six Months Ended June 30,
		2026				2025
United States		$	—			$	—
United Kingdom			28,255				9,096
Switzerland			10,322				199,028
Total		$	38,577			$	208,124

 

Note 14 — Subsequent Events

 

Series F PIPE Financing

 

On July 28, 2026, the Company entered into a securities purchase agreement (the “Series F Securities Purchase Agreement”) with an accredited investor (the “Series F PIPE Investor”), pursuant to which the Company agreed to issue and sell to the Series F PIPE Investor an aggregate of 37,812 shares of Series F convertible preferred stock, par value $0.00001 per share (“Series F Preferred Stock”), for an aggregate purchase price of $30,249,600 (the “Series F PIPE Financing”), generating net cash proceeds of $249,600.

 

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

 

July 2026 ELOC Purchase Agreement

 

On July 28, 2026, the Company entered into a Common Stock Purchase Agreement relating to a committed equity facility (the “July 2026 ELOC Purchase Agreement”) with an accredited investor (“July 2026 ELOC Investor”), pursuant to which, subject to the terms and conditions set forth therein, the Company has the right, but not the obligation, to direct the July 2026 ELOC Investor, from time to time and at the Company’s sole discretion, to purchase shares of the Company’s Common Stock having an aggregate purchase price of up to the lesser of (i) $750,000,000 and (ii) 19.99% of the total number of shares of the Company’s Common Stock outstanding immediately prior to the execution of the July 2026 ELOC Purchase Agreement, unless stockholder approval has been obtained or an exception under the applicable Nasdaq listing rules applies. Concurrently with entering into the July 2026 ELOC Purchase Agreement, the Company entered into a Registration Rights Agreement with the July 2026 ELOC Investor (the “July 2026 ELOC Registration Rights Agreement”), pursuant to which the Company agreed to provide the July 2026 ELOC Investor with certain registration rights with respect to the securities issuable under the July 2026 ELOC Purchase Agreement.

 

In consideration for the July 2026 ELOC Investor’s commitment under the July 2026 ELOC Purchase Agreement, the Company agreed to pay a $30,000,000 commitment fee, which the July 2026 ELOC Investor agreed would be applied toward its purchase of Series F Preferred Stock pursuant to the Series F Securities Purchase Agreement.

 

 

Item 2. 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.

 

There were two new peer-reviewed scientific publications published in the first quarter of 2026 on the clinical utility of Proclarix. The first paper, by Schiess et al., has been accepted for publication in BMC Cancer, an open-access oncology research journal. The study evaluated Proclarix in a cohort of 371 men and ruled out clinically insignificant or absent prostate cancer while maintaining a low risk of missing csPCa. Proclarix was subsequently shown to significantly reduce overdiagnosis and unnecessary biopsies, outperforming both %fPSA and the ERSPC risk calculator. The second paper, by Athanasiou et al., has been published in the journal Cancers (2026, 18, 1348-62). In a cohort of 132 men under active surveillance, the study demonstrated the prognostic value of Proclarix® and its risk score in predicting the transition of patients from active surveillance to active treatment.

 

Proclarix is CE-marked and for sale in Europe. In the United Kingdom, Proclarix is now offered by a patient organization as an additional option within a screening initiative for early identification of prostate cancer.

 

 

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:

 

●

commercialize Proclarix;

 

●

hire additional personnel;

 

●

operate as a public company;

 

●

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

 

●

perform product validation studies in connection with a license agreement.

 

As of June 30, 2026, Proteomedix has initiated a PRIME study, a multi-center clinical validation study conducted in collaboration with Labcorp to evaluate Proclarix in the U.S. market and across various ethnicities. The first participants have been enrolled and the study is designed to ultimately include up to 500 men. 

 

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:

 

Series F PIPE Financing

 

On July 28, 2026, the Company entered into a securities purchase agreement (the “Series F Securities Purchase Agreement”) with an accredited investor (the “Series F PIPE Investor”), pursuant to which the Company agreed to issue and sell to the Series F PIPE Investor an aggregate of 37,812 shares of Series F convertible preferred stock, par value $0.00001 per share (“Series F Preferred Stock”), for an aggregate purchase price of $30,249,600 (the “Series F PIPE Financing”), generating net cash proceeds of $249,600.

 

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

 

July 2026 ELOC Purchase Agreement

 

On July 28, 2026, the Company entered into a Common Stock Purchase Agreement relating to a committed equity facility (the “July 2026 ELOC Purchase Agreement”) with an accredited investor (“July 2026 ELOC Investor”), pursuant to which, subject to the terms and conditions set forth therein, the Company has the right, but not the obligation, to direct the July 2026 ELOC Investor, from time to time and at the Company’s sole discretion, to purchase shares of the Company’s Common Stock having an aggregate purchase price of up to the lesser of (i) $750,000,000 and (ii) 19.99% of the total number of shares of the Company’s Common Stock outstanding immediately prior to the execution of the July 2026 ELOC Purchase Agreement, unless stockholder approval has been obtained or an exception under the applicable Nasdaq listing rules applies. Concurrently with entering into the July 2026 ELOC Purchase Agreement, the Company entered into a Registration Rights Agreement with the July 2026 ELOC Investor (the “July 2026 ELOC Registration Rights Agreement”), pursuant to which the Company agreed to provide the July 2026 ELOC Investor with certain registration rights with respect to the securities issuable under the July 2026 ELOC Purchase Agreement.

 

In consideration for the July 2026 ELOC Investor’s commitment under the July 2026 ELOC Purchase Agreement, the Company agreed to pay a $30,000,000 commitment fee, which the July 2026 ELOC Investor agreed would be applied toward its purchase of Series F Preferred Stock pursuant to the Series F Securities Purchase Agreement.

 

 

May 2026 Reverse Stock Split

 

On May 8, 2026, in reliance of the stockholder approval obtained for the Reverse Stock Split Proposal at the April 2026 Special Meeting held on April 30, 2026, the Board determined to fix a reverse stock split ratio of its Common Stock of 1-to-10 (the “May Reverse Stock Split”). On May 20, 2026, the Company filed an amendment to its COI with the Secretary of State of the State of Delaware to effect the May Reverse Stock Split. The May Reverse Stock Split became effective in accordance with the terms of the Amendment at 12:01 a.m. Eastern Time on May 21, 2026 (the “May Reverse Stock Split 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 May 21, 2026. At the May Reverse Stock Split Effective Time, every 10 (ten) 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.

 

 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 further amend COI 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.

 

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.

 

February 2026 Special Meeting of Stockholders

 

On February 3, 2026, the Company held a special meeting of stockholders (the “February 2026 Special Meeting”), whereby its stockholders approved an amendment to the Company’s Amended and Restated Certificate of Incorporation (“COI”) 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 February 2026 Special Meeting (“Reverse Stock Split Proposal”).

 

On March 6, 2026, the Board determined to fix a reverse stock split ratio of its Common Stock of 1-to-5 (the “March Reverse Stock Split”). On March 24, 2026, the Company filed an amendment to its COI with the Secretary of State of the State of Delaware to effect the March Reverse Stock Split. The March 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 “March Reverse Stock Split 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 March Reverse Stock Split 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.

 

 

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:

 

●

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.

 

●

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

 

●

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

 

●

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

 

●

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:

 

●

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.

 

●

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.

 

●

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.

 

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 40,504 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 $0.9716, 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 and six months ended June 30, 2026, the holders converted 7,581 and 7,813 shares of Series E Preferred Stock into 660,365 and 668,021 shares of Common Stock. As of June 30, 2026, all shares of Series E Preferred Stock were converted into Common Stock and there were no 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 87,256 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 $0.9716, 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 and six months ended June 30, 2026, the holders converted 1,796 and 8,169 shares of Series D Preferred Stock into 153,712 and 375,977 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 June 30, 2026, there are 8,156 shares of Series D Preferred Stock outstanding.

  

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.

 

On May 21, 2026, the Company effected a reverse stock split of all shares of its issued and outstanding Common Stock at a ratio of one-for-ten (1:10). 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: 

 

●

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

 

●

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

 

●

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. During the three and six months ended June 30, 2026, royalty revenues were de minimus and there was no revenue due to the biological materials.

 

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 loss. There were no amounts payable under this contract as of June 30, 2026 and December 31, 2025. 

 

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 liabilities, derivative liabilities, and other financing-related costs.

 

Results of Operations

 

Comparison of the Three Months Ended June 30, 2026 and 2025

 

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

 

		Three Months Ended June 30, 2026				Three Months Ended June 30, 2025				$ Change				% Change
Revenue		$	17,120			$	106,494			$	(89,374	)			(83.9	)%
Cost of revenue			12,817				35,991				(23,174	)			(64.4	)%
Gross profit			4,303				70,503				(66,200	)			(93.9	)%
Operating expenses
Selling, general and administrative		$	2,245,653			$	1,523,591			$	722,062				47.4	%
Research and development			3,440				(111,670	)			115,110				103.1	%
Impairment of goodwill			486,000				594,000				(108,000	)			(18.2	)%
Total operating expenses			2,735,093				2,005,921				729,172				36.4	%
Loss from operations			(2,730,790	)			(1,935,418	)			(795,372	)			(41.1	)%
Other income (expense)
Interest expense			(4,389	)			(223,097	)			218,708				98.0	%
Change in fair value of subscription agreement liability – related party			—				(191,038	)			191,038				100.0	%
Change in fair value of contingent warrant liabilities			(400	)			(229	)			(171	)			(74.7	)%
Change in fair value of Series D derivative liability			(136,471	)			—				(136,471	)			(100.0	)%
Other - net			4,747				(22,660	)			27,407				120.9	%
Total other income			(136,513	)			(437,024	)			300,511				68.8	%
Loss before income taxes			(2,867,303	)			(2,372,442	)			(494,861	)			(20.9	)%
Income tax benefit			—				—				—				—	%
Net loss		$	(2,867,303	)		$	(2,372,442	)		$	(494,861	)			(20.9	)%
Deemed dividend Series C preferred stock			—				(328,504	)			328,504				100.0	%
Net loss applicable to common stockholders’		$	(2,867,303	)		$	(2,700,946	)		$	(166,357	)			6.2	%

 

Revenue, Cost of Revenue, and Gross Margin

 

For the three months ended June 30, 2026, the Company generated approximately $0.02 million of revenue, compared to approximately $0.1 million 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 June 30, 2026 was approximately $0.01 million, compared to approximately $0.04 million for the same period in 2025, and was primarily attributable to costs incurred related to Proteomedix product sales. Gross profit decreased to approximately $4 thousand for the three months ended June 30, 2026, compared to approximately $0.07 million for the same period in 2025, due to lower revenue. Gross margin decreased from approximately 66.2% to 25.1%, as certain production and fulfillment costs remained relatively fixed despite lower sales volumes.

 

 

Selling, General and Administrative Expenses

 

For the three months ended June 30, 2026, selling, general and administrative expenses increased by $0.7 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 June 30, 2026, research and development expenses increased by $115 thousand to $3 thousand compared to a gain of approximately $112 thousand in the same period in 2025. The gain during the three months ended June 30, 2025 resulted from the write-off of previously accrued R&D expenses that were related to terminated contracts. The expense during the three months ended June 30, 2026 related 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 June 30, 2026 totaling $0.5 million, compared to $0.6 million during the three months ended June 30, 2025.

 

Other Income

 

Other income for the three months ended June 30, 2026, increased by approximately $0.3 million compared to the same period in 2025. The increase was primarily driven by a $0.2 million reduction in interest expense and the absence of a $0.2 million loss related to the change in fair value of the subscription agreement liability recognized in the prior-year period. These favorable changes were partially offset by a $0.1 million loss associated with the change in fair value of the Series D derivative liability during the current period.

 

Income Tax Benefit

 

The Company did not record any income tax benefit or expense during the three months ended June 30, 2026 and 2025.

 

Comparison of the Six Months Ended June 30, 2026 and 2025

 

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

 

		Six Months Ended June 30, 2026				Six Months Ended June 30, 2025				$ Change				% Change
Revenue		$	38,577			$	208,124			$	(169,547	)			(81.5	)%
Cost of revenue			35,929				91,789				(55,860	)			(60.9	)%
Gross profit			2,648				116,335				(113,687	)			(97.7	)%
Operating expenses
Selling, general and administrative		$	4,284,981			$	3,197,797			$	1,087,184				34.0	%
Research and development			54,258				(87,215	)			141,473				162.2	%
Impairment of goodwill			8,620,000				11,512,000				(2,892,000	)			(25.1	)%
Total operating expenses			12,959,239				14,622,582				(1,663,343	)			(11.4	)%
Loss from operations			(12,956,591	)			(14,506,247	)			1,549,656				10.7	%
Other income (expense)
Interest expense			(6,633	)			(446,689	)			440,056				98.5	%
Change in fair value of subscription agreement liability – related party			—				3,127,962				(3,127,962	)			(100.0	)%
Change in fair value of contingent warrant liabilities			1,212				(10,024	)			11,236				112.1	%
Change in fair value of Series D derivative liability			3,819,307				—				3,819,307				100.00	%
Change in fair value of Series E derivative liability			2,072,590				—				2,072,590				100.00	%
Gain on forgiveness of accounts payable			—				944,694				(944,694	)			(100.0	)%
Other - net			(12,063	)			(28,023	)			15,960				57.0	%
Total other income			5,874,413				3,587,920				2,286,493				63.7	%
Loss before income taxes			(7,082,178	)			(10,918,327	)			3,836,149				35.1	%
Income tax benefit			—				—				—				—	%
Net loss		$	(7,082,178	)		$	(10,918,327	)		$	3,836,149				35.1	%
Deemed dividend Series C preferred stock			—				(1,498,595	)			1,498,595				100.0	%
Net loss applicable to common stockholders’		$	(7,082,178	)		$	(12,416,922	)		$	5,334,744				43.0	%

 

 

Revenue, Cost of Revenue, and Gross Margin

 

For the six months ended June 30, 2026, the Company generated approximately $39 thousand of revenue, compared to approximately $208 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 six months ended June 30, 2026 was approximately $36 thousand, compared to approximately $92 thousand for the same period in 2025, and was primarily attributable to costs incurred related to Proteomedix product sales. Gross profit decreased to approximately $3 thousand for the six months ended June 30, 2026, compared to approximately $116 thousand for the same period in 2025, due to lower revenue. Gross margin decreased from approximately 55.9% to 6.9%, as certain production and fulfillment costs remained relatively fixed despite lower sales volumes.

 

Selling, General and Administrative Expenses

 

For the six months ended June 30, 2026, selling, general and administrative expenses increased by $1.1 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 six months ended June 30, 2026, research and development expenses increased by $0.1 million from a gain of approximately $0.1 million during the six months ended June 30, 2025 to expense of $0.05 million during the six months ended June 30, 2026.  The expense during the six months ended June 30, 2026 related to the new clinical study agreement with LabCorp where the Company agreed to pay for research and development costs. The gain during the six months ended June 30, 2025 resulted from the write-off of previously accrued R&D expenses that were related to terminated contracts.

 

Impairments

  

The Company recorded an impairment of goodwill related to the PMX acquisition during the six months ended June 30, 2026 totaling $8.6 million, compared to $11.5 million during the six months ended June 30, 2025.

 

Other Income

 

Other income for the six months ended June 30, 2026 increased by approximately $2.3 million compared to the same period in 2025. The increase was primarily driven by gains of approximately $3.8 million and $2.1 million related to the changes in fair value of the Series D and Series E derivative liabilities, respectively. These favorable changes were partially offset by the absence of the $3.1 million gain recognized from the change in fair value of the subscription agreement liability in the prior-year period, the absence of the $0.9 million gain on forgiveness of accounts payable recognized in the prior-year period, and lower interest expense and other items. 

 

Income Tax Benefit

 

The Company did not record any income tax benefit or expense during the six months ended June 30, 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 June 30, 2026, the Company had cash of approximately $5.9 million, a working capital surplus of approximately $3.6 million and an accumulated deficit of approximately $138.3 million. During the six months ended June 30, 2026, the Company used approximately $4.0 million in cash for operating activities. In addition, as of August 10, 2026, the Company’s cash balance was approximately $5.4 million. The Company’s current cash balance is not sufficient to fund its operations through the end of August 2027.

 

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.

 

During July 2026, the Company entered into a Series F Preferred Stock financing and an equity line of credit arrangement that are expected to provide additional liquidity and financial flexibility to support its ongoing operations and strategic initiatives. These transactions are intended to strengthen the Company’s liquidity position and support working capital requirements. 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 participation in strategic transactions and investments, including the proposed 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 and July 2026 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. 

 

Management also continues to evaluate additional financing opportunities, including proceeds received from the July 2026 Series F PIPE financing and remaining availability under the ELOC, subject to applicable limitations and conditions.. 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:

 

		Six Months Ended June 30, 2026				Six Months Ended June 30, 2025
Net cash used in operating activities		$	(4,039,548	)		$	(3,409,976	)
Net cash provided by investing activities			—				—
Net cash provided by financing activities			4,800,163				3,614,828
Effect of exchange rate changes on cash			(39,020	)			(567,837	)
Net increase (decrease) in cash		$	721,595			$	(362,985	)

 

 

Cash Flows from Operating Activities

 

Net cash used in operating activities for the six months ended June 30, 2026, was approximately $4.0 million, which was primarily driven by a net loss of approximately $7.1 million and gain on change in fair value of derivative liabilities of approximately $6.0 million, which were offset by a non-cash stock-based compensation expense of approximately $0.03 million, loss on impairment of goodwill of approximately $8.6 million, and net changes in our operating assets and liabilities of $0.3 million.

 

Net cash used in operating activities for the six months ended June 30, 2025, was approximately $3.4 million, which primarily resulted from a net loss of approximately $10.9 million, a non-cash change in fair value of subscription liability of approximately $3.1 million, a gain on forgiveness of accounts payable of approximately $0.9 million, and net changes in our operating assets and liabilities of $(0.1) million. These items were offset by several non-cash items, which primarily include impairment of goodwill of approximately $11.5 million. 

 

Cash Flows from Financing Activities

 

Net cash provided by financing activities for the six months ended June 30, 2026, was approximately $4.8 million, and resulted primarily from proceeds of approximately $0.4 million from exercise of warrants, proceeds of approximately $4.3 million from the purchase of common stock in connection with the ELOC and net proceeds of approximately $0.15 million from notes payable.

 

Net cash provided by financing activities for the six months ended June 30, 2025, was approximately $3.6 million, and resulted primarily from proceeds of approximately $6.4 million from the purchase of common stock in connection with the ELOC and $0.5 million from the issuance of notes payable. These proceeds were offset by payments on notes payable of approximately $1.5 million and a payment of approximately $1.7 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 June 30, 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.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

As a smaller reporting company, we are not required to provide the information required by this Item.

 

Item 4. Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) that are designed to ensure that information required to be disclosed by us in reports we file or submit under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the appropriate time periods, and that such information is accumulated and communicated to the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely discussions regarding required disclosure. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer has evaluated the effectiveness of our disclosure controls and procedures. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost benefit relationship of possible controls and procedures. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer has concluded that the Company’s disclosure controls and procedures were not effective as of June 30, 2026, as a result of the material weaknesses described below.

 

Material Weaknesses in Internal Control Over Financial Reporting

 

A material weakness in internal control is a deficiency in internal control, or combination of control deficiencies, that adversely affects the Company’s ability to initiate, authorize, record, process, or report external financial data reliably in accordance with GAAP such that there is more than a remote likelihood that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected.

 

We have identified the following internal control deficiencies, which we believe to be material weaknesses as of June 30, 2026:

 

●

We did not maintain an effective control environment as there was an inadequate segregation of duties with respect to certain cash disbursements.

 

●

We do not have an effective risk assessment process and effective monitoring of compliance with established accounting policies and procedures, and do not demonstrate a sufficient level of precision in the application of our controls.

 

●

Our controls over the approval and reporting of expense payments were not designed and maintained to achieve the Company’s objectives.

 

●

We do not yet have adequate internal controls in place for the timely identification, approval or reporting of related party transactions.”

 

 

●

We have insufficient accounting resources to maintain adequate segregation of duties, maintain adequate controls over the approval and posting of journal entries, and to provide optimal levels of oversight in order to process financial information in a timely manner, analyze and account for complex, non-routine transactions, and prepare financial statements.

 

●

The Company did not design, implement and maintain effective controls to ensure information technology (“IT”) policies and procedures set the tone at the top, to mitigate the risks to the achievement of IT objectives and ITGCs in the change management, logical security and computer operations domains. Specifically, the design and implementation of user authentication, user access privileges, data backup and data recovery controls as well as the monitoring controls of excessive user access and elevated privileged access to financial applications and data were not appropriately designed and maintained. In addition, these inadequate ITGC controls combined with the use of personal devices to conduct business, can lead to an IT control environment vulnerable to breaches and social engineering persuasion.

 

The above material weaknesses did not result in a material misstatement of our previously issued financial statements but could have resulted in material misstatements of our account balances or disclosures of our annual or interim financial statements that would not be prevented or detected. We have developed a remediation plan for these material weaknesses which is described below in Remediation of Material Weaknesses.

 

Remediation of Material Weaknesses

 

As of the date of this Quarterly Report on Form 10-Q, management is re-assessing the design of controls and modifying processes designed to improve our internal control over financial reporting and remediate the control deficiencies that led to the material weaknesses, including but not limited to (a) improving consistency in change management supported by standard operating procedures to govern the authorization, testing and approval of changes to information technology systems supporting all of the Company’s internal control processes, (b) enhancing design and implementation of our control environment, including the expansion of formal accounting and IT policies and procedures and financial reporting controls, (c) continuing to identify and design and implement effective review and approval controls, and (d) implementing appropriate timely review and oversight responsibilities within the accounting and financial reporting functions and ensuring appropriate segregation of duties.

 

We will consider the material weaknesses remediated after the applicable controls operate for a sufficient period of time, and management has concluded, through testing, that the controls are operating effectively.

 

The process of designing and implementing an effective accounting and financial reporting system is a continuous effort that requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to maintain an accounting and financial reporting system that is adequate to satisfy our reporting obligations. As we continue to evaluate and take actions to improve our internal control over financial reporting, we may determine to take additional actions to address control deficiencies or determine to modify certain of the remediation measures described above. We cannot assure you that the measures we have taken to date, or any measures we may take in the future, will be sufficient to remediate the material weakness we have identified or avoid potential future material weaknesses.

 

Inherent Limitation on the Effectiveness of Internal Control Processes

 

Our Chief Executive Officer and Chief Financial Officer does not expect that our disclosure controls or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

 

Changes in Internal Control over Financial Reporting

 

During the fiscal quarter ended June 30, 2026, there were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 

PART II – OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We are not currently subject to any material legal proceedings, nor, to our knowledge, is any material legal proceeding threatened against us or any of our officers or directors in their corporate capacity.

 

Item 1A. Risk Factors

 

In addition to the following risk factors, you should carefully consider the risk factors included in our Annual Report on Form 10-K, filed with the SEC on March 13, 2026, as supplemented and updated by subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K that we have filed or will file with the SEC. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations.

 

Risks Related to our Financial Position and Need for Capital

 

The SEC had recently approved a Nasdaq rule where the market value of listed companies on Nasdaq must meet a certain threshold, and if we are unable to regain or maintain compliance with such continued listing requirements of Nasdaq, our Common Stock could be delisted from the Nasdaq Capital Market.

 

On July 22, 2026, the SEC approved a Nasdaq rule change requiring the immediate suspension and delisting of any listed company whose market value of listed securities (“MVLS”) falls below $5 million for 30 consecutive business days, subject to limited review by a Nasdaq Hearings Panel. Under the approved rule, a timely request for a hearing will not stay the suspension of trading, and our securities would generally trade on the over-the-counter market during any appeal process. The Nasdaq Hearings Panel may grant a limited exception period (not to exceed 180 days) to demonstrate compliance with initial listing requirements, but there can be no assurance that such relief would be granted.

 

Our ability to maintain compliance with the $5 million MVLS requirement depends on a number of factors, including the market price of our Common Stock and the number of our issued and outstanding shares. The market price of our Common Stock may be volatile and could decline for reasons beyond our control, including:

 

●

general market conditions or downturns in the broader equity markets;

 

●

sector-specific or industry-wide volatility;

 

●

changes in interest rates or macroeconomic conditions;

 

●

geopolitical events;

 

●

actual or perceived short selling activity or other trading dynamics;

 

●

reduced liquidity or limited public float; and

 

●

investor perceptions regarding our business, prospects, or financial condition.

  

If our MVLS were to fall below $5 million for 30 consecutive business days, Nasdaq would issue a staff delisting determination and immediately suspend trading of our Common Stock on Nasdaq. Any suspension or delisting of our Common Stock from Nasdaq could materially and adversely affect our business, financial condition, results of operations, and the value of our Common Stock.

 

 

In the event that our Common Stock is delisted from Nasdaq, as a result of our failure to comply with the Minimum Bid Price Requirement, or due to our failure to continue to comply with any other requirement for continued listing on Nasdaq, and is not eligible for listing on another exchange, trading in the shares of our Common Stock could be conducted in the over-the-counter market or on an electronic bulletin board established for unlisted securities such as the Pink Sheets or the OTC Bulletin Board. In such event, it could become more difficult to dispose of, or obtain accurate price quotations for, our Common Stock, and it would likely be more difficult to obtain coverage by securities analysts and the news media, which could cause the price of our Common Stock to decline further. Also, it may be difficult for us to raise additional capital if we are not listed on a national exchange.

 

We have incurred significant net losses since inception, have only generated minimal revenue, and anticipate that we will continue to incur substantial net losses for the foreseeable future and may never achieve profitability. Our stock is a highly speculative investment.

 

We are a commercial-stage biotechnology company that was incorporated in October 2018. Our net loss was $7.1 million for the six months ended June 30, 2026. As of June 30, 2026, we had an accumulated deficit of $138.3 million. We also generated negative operating cash flows of $4.0 million for the six months ended June 30, 2026.

 

We expect to continue to spend significant resources to commercialize our product. We expect to incur substantial and increasing operating losses over the next several years. As a result, our accumulated deficit will also increase significantly. Additionally, there can be no assurance that our current product or those that may be under development by us in the future will be commercially viable. If we are unable to achieve profitability or raise sufficient working capital, we may be unable to continue our operations.

 

There is substantial doubt about our ability to continue as a “going concern,” and we will require substantial additional funding to finance our long-term operations. If we are unable to raise additional capital when needed, we could be forced to delay, reduce or terminate our product or other operations.

 

The Company has incurred substantial operating losses since inception and expects to continue to incur significant operating losses for the foreseeable future. As of June 30, 2026, the Company had cash of approximately $5.9 million, a working capital surplus of approximately $3.6 million and an accumulated deficit of approximately $138.3 million. In addition, as of August 10, 2026, the Company’s cash balance was approximately $5.4 million, and the Company has approximately $0.2 million of debt due within the next 12 months.

  

We believe that we will need to raise substantial additional capital to fund our continuing operations, satisfy existing and future obligations and liabilities, and otherwise support the Company’s working capital needs and business activities, including completing the Realbotix Transactions on a timely basis and the commercialization of Proclarix, which is still subject to further successful development and commercialization activities within certain jurisdictions.

 

Management also intends to secure additional required funding through equity or debt financings if available. In December 2024, the Company began utilizing the ELOC entered into in October 2024 (see Note 9) on an as-needed basis to fund current operating needs, 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, close the Realbotix Transactions on a timely basis 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 future product candidates, delay the closing of the Realbotix Transactions on a timely basis 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 is required to, file for bankruptcy.

 

 

These conditions raise substantial doubt about the Company’s ability to continue as a going concern for a period of time within one year following the date of this Report. 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 development and commercialization activities, including product manufacturing, marketing, sales, royalties and distribution, for Proclarix, and other products for which we have received or will receive marketing approval;

 

●

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 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.

 

Our ability to raise additional funds will depend on financial, economic, and other factors, many of which are beyond our control. Subsequent to June 30, 2026, we completed a Series F financing and entered into a new ELOC on July 28, 2026, which provided additional liquidity and access to capital. However, there can be no assurance that these financing arrangements, together with existing cash resources, will be sufficient to fund our operations for the foreseeable future or that additional financing will be available on acceptable terms, if at all. If we are unable to secure adequate funding, we may be forced to delay, reduce, or terminate our business activities.

 

Our current liabilities are significant, and if those to whom we owe accounts payable were to demand payment, we would be unable to pay.

 

As of June 30, 2026, we had total current liabilities of approximately $2.9 million, including accounts payable of approximately $1.8 million, accrued expenses of approximately $0.3 million, derivative liabilities of $0.6 million, and approximately $0.2 million related to the notes payable. As of the same date, we had cash of only $5.9 million. We plan to seek funding to support our operations. However, the level of our current liabilities may make it more difficult for us to obtain adequate financing on favorable terms, if at all. If those to whom these payments are due were to demand immediate payment, as they are entitled to do, and we are not able to make the required payments, we would be subject to liability if our creditors chose to enforce their rights, which could result in our bankruptcy and insolvency. Under such a scenario, our assets would be distributed to our creditors leaving nothing to be distributed to our stockholders.

 

Risks Related to Pending Share Exchange

 

We could fail to complete the Realbotix Transactions, or the Realbotix Transactions may be completed on different terms.

 

There can be no assurance that the Realbotix Transactions will be completed, or if completed, that they will be completed on the same or similar terms to those set out in our previous disclosure. The Realbotix Transactions are subject to the satisfaction of a number of conditions precedent, some of which are outside our control, which include, among others, performance by Simulacra and Realbotix of their respective obligations and covenants in the Share Exchange Agreement. If these conditions are not satisfied (or waived) or the Realbotix Transactions are not completed for any other reason, our stockholders will not receive the consideration contemplated in the Share Exchange Agreement.

 

If the Realbotix Transactions are not completed, our ongoing business may be adversely affected as a result of the costs (including opportunity costs) incurred in respect of pursuing the Realbotix Transactions, and we could experience negative reactions from the financial markets, which could cause a decrease in the market price of our Common Stock, particularly if the current market price reflects market assumptions that the Realbotix Transactions will be completed or completed on certain terms. We may also experience negative reactions from our employees and there could be negative impact our ability to attract future business opportunities. Failure to complete the Realbotix Transactions or a change in the terms of the Realbotix Transactions could each have a material adverse effect on our business, financial condition and results of operations.

 

 

We may pay a transaction fee to Realbotix if we fail to complete the Realbotix Transactions and could significantly harm the market price of our common stock and negatively affect our future business and operations.

 

If the Realbotix Transactions is not completed and the Share Exchange Agreement is terminated under certain circumstances, we may be required to pay Realbotix a termination fee as follows:

 

●

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.

 

●

In the event of a termination of the Share Exchange Agreement if (i) our Board deems a third-party offer to acquire our assets to be superior than the Share Exchange Agreement and is therefore in the best interest of our stockholders (the “Buyer Superior Proposal”) and/or (ii) enters into an agreement with a third-party to effectuate a Buyer Superior Proposal, we must pay a termination fee of (A) $500,000 plus all Realbotix 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 does not close, we are only obligated to pay $500,000 plus all Realbotix transaction expenses.

 

●

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

 

Even if a termination fee is not payable in connection with a termination of the Share Exchange Agreement, we will have incurred significant fees and expenses, which must be paid whether or not the Realbotix Transactions is completed. Further, if the Realbotix Transactions is not completed, it could significantly harm the market price of our common stock.

 

In addition, if the Share Exchange Agreement is terminated and we determine to seek another business combination, there can be no assurance that we will be able to find a partner and close an alternative transaction on terms that are as favorable as or more favorable to us than the terms set forth in the Share Exchange Agreement.

 

The closing of the Realbotix Transactions is subject to approval by our stockholders.. Failure to obtain these other required approvals would prevent the closing of the Realbotix Transactions.

 

The closing of the Realbotix Transactions is subject to certain approvals by our stockholders.. Failure to obtain the required stockholder approvals may result in a material delay in, or the abandonment of, the Realbotix Transactions. Any delay in completing the Realbotix Transactions may materially adversely affect the timing and benefits that are expected to be achieved from the Realbotix Transactions.

 

If the Realbotix Transactions is not completed, the Board may decide to pursue our dissolution and liquidation. In such an event, the amount of cash available for distribution to our stockholders will depend heavily on the timing of such liquidation as well as the amount of cash that will need to be reserved for commitments and contingent liabilities.

 

There can be no assurance that the Realbotix Transactions will be completed. If the Realbotix Transactions is not completed, our Board may decide to pursue our dissolution and liquidation. In such an event, the amount of cash available for distribution to our stockholders will depend heavily on the timing of such decision, as with the passage of time the amount of cash available for distribution will be reduced we continue to fund our operations. In addition, if our Board were to approve and recommend, and our stockholders were to approve, our dissolution and liquidation, we would be required under Delaware corporate law to pay its outstanding obligations, as well as to make reasonable provision for contingent and unknown obligations, prior to making any distributions in liquidation to our stockholders. As a result of this requirement, a portion of our remaining cash assets may need to be reserved pending the resolution of such obligations. In addition, we may be subject to litigation or other claims related to a dissolution and liquidation. If a dissolution and liquidation were pursued, our Board, in consultation with its advisors, would need to evaluate these matters and make a determination about a reasonable amount to reserve. Accordingly, holders of our common stock could lose all or a significant portion of their investment in the event of pir liquidation, dissolution or winding up.

 

The issuance of securities would result in significant dilution in the equity interest of existing stockholders and adversely affect the marketplace of our Common Stock.

 

The issuance or conversion of Common Stock or other securities convertible into Realbotix Common Stock in connection with the Realbotix Transactions would result in significant dilution in the equity interest of our existing stockholders and adversely affect the market price of our Common Stock. In addition, future issuances of, or conversions of, securities may result in significant dilution to our existing stockholders, which could adversely impact your investment. 

 

Future issuances of shares of our Common Stock, including upon exercise or conversion of outstanding securities, could result in substantial dilution of our stockholders and may have a negative impact on the market price of our Common Stock.

 

The shares of our Common Stock that may be issued under the ELOC Purchase Agreements (together, the “ELOC Purchase Agreements”) may be sold by us to the respective October 2024 ELOC Investor and July 2026 ELOC Investor (together, the “ELOC Investors”) from time to time from the date of (i) the 36-month anniversary of the effective date of the registration statement registering the shares of Common Stock issued under the ELOC Purchase Agreements, (ii) the date on which the ELOC Investors has purchased the aggregate limit under the respective ELOC Purchase Agreements, (iii) the date on which our Common Stock fails to be listed or quoted on Nasdaq or any successor Eligible Market (as defined in the ELOC Purchase Agreements), and (iv) the date on which, pursuant to or within the meaning of any bankruptcy law, a custodian is appointed for us or for all or substantially all of our property, or we make a general assignment for the benefit of our creditors. 

 

 

The purchase price for shares of our Common Stock that we may sell to the ELOC Investors under the respective ELOC Purchase Agreements will fluctuate based on the trading price of shares of our Common Stock. Depending on market liquidity at the time, sales of shares of our Common Stock may cause the trading price of shares of our Common Stock to decrease. We generally have the right to control the timing and amount of any future sales of shares of our Common Stock to the ELOC Investors. Additional sales of shares of our Common Stock, if any, to the ELOC Investors will depend upon market conditions and other factors to be determined by us. We may ultimately decide to sell to the ELOC Investors all, some or none of the additional shares of our Common Stock that may be available for us to sell pursuant to the ELOC Purchase Agreements. If and when we do sell shares of our Common Stock to the ELOC Investors, after the ELOC Investors has acquired shares of our Common Stock, the ELOC Investors may resell all, some or none of such shares of our Common Stock at any time or from time to time in its discretion and at different prices. Therefore, sales to the ELOC Investors by us could result in substantial dilution to the interests of other holders of shares of our Common Stock. In addition, if we sell a substantial number of shares of our Common Stock to the ELOC Investors under the respective ELOC Purchase Agreements, or if investors expect that we will do so, the shares held by the ELOC Investors will represent a significant portion of our public float and may result in substantial decreases to the price of our Common Stock. The actual sales of shares of our Common Stock or the mere existence of our arrangement with the ELOC Investors may also make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish to effect such sales. 

 

The market price of shares of our Common Stock could drop significantly if the ELOC Investors sells shares of Common Stock or is perceived by the market as intending to sell them. These factors could also make it more difficult for us to raise additional funds through future offerings of shares of our Common Stock or other securities. 

 

Additionally, the shares of Common Stock issuable pursuant to our outstanding convertible securities, including the Series C Warrants, the Series D Warrants, the Series E Warrants, the Series C Preferred Stock, the Series D Preferred Stock, the Series F Preferred Stock, and preferred investment options, to the extent exercised or converted, respectively, could impose significant dilution on our stockholders and may have a negative impact on the market price of our Common Stock. Each of the Series D Warrants, the Series E Warrants and the respective Certificate of Designations for the Series D Preferred Stock and for the Series F Preferred Stock provide that if the Company issues (subject to certain exceptions) (i) any shares of Common Stock, (ii) any options to purchase Common Stock or (iii) any convertible securities, for a consideration price per share or exercise or conversion price per share, as applicable, less than the exercise price of the respective Series D Warrants, the Series E Warrants or the conversion price of the Series D Preferred Stock and for the Series F Preferred Stock, respectively, in effect immediately prior to such issuance, the exercise price and conversion price shall be reduced accordingly. Such adjustments could result in additional dilution to our stockholders and further depress the market price of our Common Stock.

 

Our stockholders may not realize a benefit from the acquisition of Realbotix commensurate with the ownership dilution they will experience in connection with the Realbotix Transactions contemplated by the Share Exchange Agreement.

 

If we are unable to realize the full strategic and financial benefits currently anticipated from the Realbotix Transactions, our stockholders may experience a dilution of their ownership interests without receiving any commensurate benefit, or only receiving part of the commensurate benefit to the extent we are able to realize only part of the strategic and financial benefits currently anticipated from the Realbotix Transactions. The Realbotix Transactions may pose integration challenges which could result in management and business disruptions, any of which could harm our results of operation, business prospects, and impair the value of the Realbotix Transactions to our stockholders.

 

The failure to successfully integrate the businesses of us and Realbotix in the expected timeframe would adversely affect our future results.

 

Our ability to successfully integrate our operations and those of Realbotix will depend, in part, on our ability to realize the anticipated benefits from the Realbotix Transactions. If we are not able to achieve the stated objectives, the anticipated benefits of the Realbotix Transactions may not be realized fully, or at all, or may take longer to realize than expected, and the value of our Common Stock may be adversely affected. In addition, the integration of our and Realbotix’s respective businesses will be a time-consuming and expensive process. Proper planning and effective and timely implementation will be critical to avoid any significant disruption to our operations. It is possible that the integration process could result in the loss of key employees, the disruption of our business or the identification of inconsistencies in standards, controls, procedures and policies that adversely affect our ability to maintain relationships with customers, suppliers, distributors, creditors or lessors, or to achieve the anticipated benefits of the Realbotix Transactions. Delays encountered in the integration process could have a material adverse effect on our operating results and financial condition, including the value of our Common Stock.

 

The pending Realbotix Transactions may divert the attention of our management.

 

The pending Realbotix Transactions could cause the attention of our management to be diverted from the day-to-day operations. These disruptions could be exacerbated by a delay in the completion of the Realbotix Transactions and could have an adverse effect on our business, operating results or prospects regardless of whether the Realbotix Transactions are ultimately completed.

 

Unexpected market disruptions may cause major losses for us not anticipated under the Share Exchange Agreement.

 

We may incur major losses in the event of disrupted markets and other extraordinary events in which market behavior diverges significantly from historically recognized patterns, which may offset any potential benefits achieved under the Share Exchange Agreement. The risk of loss in such events may be compounded by the fact that, in disrupted markets, many positions become illiquid, making it difficult or impossible to close out positions against which markets are moving. Market disruptions caused by unexpected political, military and terrorist events, or other factors, may from time to time cause dramatic losses for us.

 

 

Risks associated with changes in the technology industry.

 

Realbotix operates in a competitive industry characterized by rapid technological change and evolving industry standards. Realbotix’s ability to attract new customers to its business, and generate revenue from existing customers will depend largely on its ability to anticipate industry standards and trends, respond to technological advances in its industry, and keep pace with technological developments and customers’ increasingly sophisticated needs. The success of any enhancement of Realbotix’s products or new related applications will depend on several factors, including the timely completion and market acceptance of the products.

 

Realbotix’s services are expected to embody complex technology that may not meet those standards, changes and preferences. Realbotix’s ability to design, develop and commercially launch products depends on a number of factors, including, but not limited to, its ability to design and implement solutions and services at an acceptable cost and quality, its ability to attract and retain skilled technical employees, the availability of critical components from third parties, and its ability to successfully complete the development of the products in a timely manner. There is no guarantee that Realbotix will be able to respond to market demands. If Realbotix is unable to effectively respond to technological changes or fails or delays to develop services in a timely and cost-effective manner, Realbotix may be unable to recover our development expenses which could negatively impact sales, profitability and the continued viability of its business.

 

We may be unable to protect Realbotix’s intellectual property.

 

Realbotix’s commercial success depends to a significant degree upon its ability to develop new or improved technologies, instruments, and services, and to obtain patents, where appropriate, or other intellectual property rights or statutory protection for these technologies and products in Canada and the United States. Despite devoting resources to the research and development of proprietary technology, Realbotix, may not be able to develop new technology that is patentable or protectable. Further, patents issued to Realbotix, if any, could be challenged, held invalid or unenforceable, or be circumvented and may not provide Realbotix with necessary or sufficient protection or a competitive advantage. Competitors and other third parties may be able to design around Realbotix’s intellectual property or develop technology similar to Realbotix’s products that is not within the scope of such intellectual property. Realbotix’s inability to secure its indirectly owned, intellectual property rights may have a materially adverse effect on its business and results of operations.

 

The business of Realbotix is exposed to cybersecurity risks.

 

Cyber incidents can result from deliberate attacks or unintentional events, and may arise from internal sources (e.g., employees, contractors, suppliers and operational risks) or external sources (e.g., nation states, terrorists, hacktivists, competitors and acts of nature). Cyber incidents include unauthorized access to information systems and data (e.g., through hacking or malicious software) for purposes of misappropriating or corrupting data or causing operational disruption. Cyber incidents also may be caused in a manner that does not require unauthorized access, such as causing denial-of-service attacks on websites (e.g., efforts to make network services unavailable to intended users). A cyber incident that affects Realbotix might cause disruptions and adversely affect their respective business operations and might also result in violations of applicable law (e.g., personal information protection laws), each of which might result in potentially significant financial losses and liabilities, regulatory fines and penalties, reputational harm, and reimbursement and other compensation costs to Realbotix. In addition, substantial costs might be incurred to investigate, remediate, and prevent cyber incidents.

 

We expect to incur significant transaction costs in connection with the Realbotix Transactions.

 

We expect to incur a number of non-recurring costs associated with negotiating and completing the Realbotix Transaction. These fees and costs have been, and will continue to be, substantial and, in many cases, will be borne by us whether or not the Realbotix Transaction is completed. A substantial majority of our non-recurring expenses will consist of transaction costs related to the Realbotix Transactions and include, among others, fees paid to financial, legal, accounting and other advisors. We will continue to assess the magnitude of these costs, and we may incur additional unanticipated costs. The costs described above and any unanticipated costs and expenses, many of which will be borne by us even if the Realbotix Transaction is not completed, could have an adverse effect on our financial condition and operating results.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

There are no transactions that have not been previously included in a Current Report on Form 8-K.

 

Issuer Purchases of Equity Securities

 

None.

 

Item 3. Default Upon Senior Securities

 

None.

 

Item 4. Mine Safety Disclosures

 

Not applicable.

 

Item 5. Other Information

 

None

 

 

Item 6. Exhibits

 

The following documents are filed as exhibits to this Report.

 

EXHIBIT INDEX

 

				Incorporated by Reference
Exhibit No.		Description		Form		Exhibit		Filing Date
2.1		Share Exchange Agreement, dated February 11, 2026, by and among Onconetix, Inc., Realbotix, LLC, Realbotix Corp, and Simulacra Corporation.†		8-K		2.1		February 12, 2026
3.1		Amended and Restated Certificate of Incorporation filed with Delaware Secretary of State dated February 23, 2022		8-K		3.1		February 24, 2022
3.2		Certificate of Amendment to the Company’s Second Amended and Restated Certificate of Incorporation, dated April 24, 2023		8-K		3.1		April 24, 2023
3.3		Certificate of Amendment to the Company’s Second Amended and Restated Certificate of Incorporation, dated December 21, 2023		8-K		3.1		December 21, 2023
3.4		Certificate of Amendment to the Amended and Restated Certificate of Incorporation, as amended, of Onconetix, Inc., dated September 24, 2024		8-K		3.1		September 24, 2024
3.5		Certificate of Amendment to the Amended and Restated Certificate of Incorporation, as amended, of Onconetix, Inc., dated June 11, 2025		8-K		3.1		June 11, 2025
3.6		Certificate of Amendment to the Amended and Restated Certificate of Incorporation, as amended, of Onconetix, Inc. dated March 25, 2026		8-K		3.1		March 27, 2026
3.7		Certificate of Amendment to the Amended and Restated Certificate of Incorporation, as amended, of Onconetix, Inc. dated May 20, 2026		8-K		3.1		May 19, 2026
3.8		Fourth Amended and Restated Bylaws of the Company		8-K		3.2		December 21, 2023
3.9		Certification of Designation of Series C Preferred Stock.		8-K		3.1		October 3, 2024
3.10		Certificate of Correction to Certificate of Designations authorizing the issuance of the Series C Preferred Stock		10-Q		3.7		June 12, 2025
3.11		Certification of Designation of Series D Preferred Stock.		8-K		3.1		September 26, 2025
3.12		Certification of Designation of Series F Preferred Stock.		8-K		3.1		July 29, 2026
4.1		Form of Inducement PIO		8-K		4.1		July 11, 2024
4.2		Form of Warrant (Series C)		8-K		4.1		October 3, 2024
4.3		Form of Warrant (Series D)		8-K		4.1		September 26, 2025
4.4		Form of Warrant (Series E)		8-K		4.1		October 3, 2025
10.1		Common Stock Purchase Agreement, between the Company and the July 2026 ELOC Investor, dated July 28, 2026		8-K		10.3		July 29, 2026
10.2		Registration Rights Agreement, between the Company and the July 2026 ELOC Investor, dated July 28, 2026		8-K		10.4		July 29, 2026
31.1*		Certification of Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of the Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**		Certification of the Principal Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**		Certification of the Principal Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*		Inline XBRL Instance Document.
101.SCH*		Inline XBRL Taxonomy Extension Schema Document.
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

 

*	Filed herewith.

 

**	Furnished herewith.

 

†	Certain of the exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The Company agrees to furnish a copy of all omitted exhibits and schedules to the SEC upon its request.

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

	Onconetix, Inc.
Date: August 13, 2026	/s/ David A. White
	David A. White
	Chief Executive Officer (principal executive officer)