UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-K



| | x | ANNUAL
    REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
| | - | ----------------------------------------------------------------------------------------



For the Fiscal Year Ended December 31,
2021

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 001-41264



NUVECTIS PHARMA, INC.

(Exact name of registrant as specified in its
charter)





|Delaware                                                           | 86-2405608                              
|------------------------------------------------------------------ | ----------------------------------------
|(State
    or Other Jurisdiction of Incorporation or Organization) | (I.R.S.
    Employer Identification No.)
|                                                                   |                                         
|1
    Bridge Plaza, Suite 275                                      |                                         
|Fort
    Lee, NJ 07024                                             | 07024                                   
|(Address
    of Principal Executive Offices)                       | (Zip
    Code)                          



Registrant’s telephone number, including
area code: (201) 614-3150



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



|Title
    of each class                  | ​ | Trading
    Symbol(s) |  | Name
    of each exchange on which registered
|---------------------------------------- | - | --------------------- |  | ---------------------------------------------
|Common
    Stock, par value $0.00001 per | ​ | NVCT                  |  | NASDAQ
    Capital Market                    



Securities registered pursuant to section 12(g) of
the Act: None.



Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ̈Nox



Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ̈Nox



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 ̈Nox



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).   YesxNo ̈



Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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   | x | Smaller reporting company | x
|                        |   |                           |  
|Emerging growth company | x |                           |  



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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal
control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public
accounting firm that prepared or issued its audit report. ̈



Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).   Yes ̈Nox



As of December 31, 2021, the last business
day of the registrant’s most recently completed fiscal year, the common stock of the registrant was not listed on any securities
exchange or quoted on any automated quotation system. Accordingly, the aggregate market value of the registrant’s common stock
held by non-affiliates cannot be calculated as of such date. As of March 17, 2022, the aggregate market value of the registrant’s
common stock held by non-affiliates was approximately $32.2 million, based on the closing sale price of $7.63 as quoted by the Nasdaq
Stock Market as of such date.



Indicate the number of shares outstanding of
each of the registrant’s classes of common stock, as of the latest practicable date.



|                                     |  |                                            
|------------------------------------ |  | -------------------------------------------
|Class of
    Common Stock            |  | Outstanding
    Shares as of March 17, 2022
|Common
    Stock, $0.00001 par value |  | 12,717,794                                 


















NUVECTIS PHARMA, INC.

ANNUAL REPORT ON FORM 10-K

TABLE OF CONTENTS



|         |                                                                                                                  | Page
|-------- | ---------------------------------------------------------------------------------------------------------------- | ----
|PART I   | ​                                                                                                                | 6   
|Item 1.  | Business                                                                                                         | 6   
|Item 1A. | Risk Factors                                                                                                     | 17  
|Item 1B. | Unresolved
    Staff Comments                                                                                    | 44  
|Item 2.  | Properties                                                                                                       | 44  
|Item 3.  | Legal Proceedings                                                                                                | 44  
|Item 4.  | Mine Safety
    Disclosures                                                                                      | 44  
|         |                                                                                                                  |     
|PART II  |                                                                                                                  | 44  
|Item 5.  | Market for
    Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 44  
|Item 6.  | [Reserved]                                                                                                       | 46  
|Item 7.  | Management’s
    Discussion and Analysis of Financial Condition and Results of Operations                        | 47  
|Item 7A. | Quantitative
    and Qualitative Disclosures About Market Risk                                                   | 53  
|Item 8.  | Financial
    Statements and Supplementary Data                                                                  | 53  
|Item 9.  | Changes
    in and Disagreements with Accountants on Accounting and Financial Disclosure                         | 53  
|Item 9A. | Controls and
    Procedures                                                                                      | 53  
|Item 9B. | Other Information                                                                                                | 53  
|Item 9C. | Disclosure
    Regarding Foreign Jurisdictions that Prevent Inspections                                          | 53  
|         |                                                                                                                  |     
|PART III |                                                                                                                  | 54  
|Item 10. | Directors,
    Executive Officers and Corporate Governance                                                       | 54  
|Item 11. | Executive
    Compensation                                                                                       | 60  
|Item 12. | Security Ownership
    of Certain Beneficial Owners and Management and Related Stockholder Matters               | 65  
|Item 13. | Certain Relationships
    and Related Transactions, and Director Independence                                    | 67  
|Item 14. | Principal
    Accountant Fees and Services                                                                       | 68  
|         |                                                                                                                  |     
|PART IV  |                                                                                                                  | 69  
|Item 15. | Exhibits and Financial
    Statement Schedules                                                                   | 69  
|Item 16. | Form 10-K
    Summary                                                                                            | 71  



2







SPECIAL CAUTIONARY NOTICE REGARDING FORWARD-LOOKING
STATEMENTS



Certain matters discussed
in this report may constitute forward-looking statements for purposes of the Securities Act of 1933, as amended (the “Securities
Act”) and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and involve known and unknown risks,
uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from the future
results, performance or achievements expressed or implied by such forward-looking statements. The words “may,” “will,”
 “should,” “expect,” “plan,” “anticipate,” “could,” “intend,”
 “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,”
 “would,” “potential,” “continue,” “anticipate,” “believe,” “estimate,”
 “may,” “expect” and similar expressions are generally intended to identify forward-looking statements. These
forward-looking statements are based on management’s current expectations and assumptions about future events, which are inherently
subject to uncertainties, risks and changes in circumstances that are difficult to predict.



Our actual results may differ
materially from the results anticipated in these forward-looking statements due to a variety of factors, including, without limitation,
those discussed under the captions “Risk Factors,” and elsewhere in this report. All written or oral forward-looking statements
attributable to us are expressly qualified in their entirety by these cautionary statements. Such forward-looking statements include,
but are not limited to, statements about:



| | ● | expectations for increases
    or decreases in expenses;                                                                                                                                                                                           
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                    
| | ● | the success
    and timing of our clinical trials and preclinical studies, including safety and efficacy of our product candidates, patient accrual,
    unexpected or expected safety events, and the usability of data generated from our trials;
| |   |                                                                                                                                                                                                                                                    
| | ● | expectations
                                for incurring capital expenditures to expand our research and development and manufacturing capabilities;                                                                                             
| |   |                                                                                                                                                                                                                                                    
| | ● | estimates of the sufficiency of our existing cash and cash equivalents and investments to finance our
                                operating requirements, including expectations regarding the value and liquidity of our investments;         
| |   |                                                                                                                                                                                                                                                    
| | ● | expectations for generating
    revenue or becoming profitable on a sustained basis;                                                                                                                                                               
| |   |                                                                                                                                                                                                                                                    
| | ● | the impact of health epidemics,
    including the COVID-19 pandemic, on our business and the actions we may take in response thereto;                                                                                                              



| | ● | developments and projections
    relating to our competitors and industry;
| | - | --------------------------------------------------------------------------



| | ● | our expectations about how
    market trends will affect our business;
| | - | ----------------------------------------------------------------------



| | ● | our and
    our licensors’ ability to obtain, establish, maintain, protect and enforce intellectual property and proprietary protection
    for our products and technologies and to avoid claims of infringement, misappropriation or other violation of third-party intellectual
    property and proprietary rights;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | our ability to attract and
    retain key personnel and to manage our future growth effectively;
| | - | ------------------------------------------------------------------------------------------------



| | ● | expectations for future capital
    requirements;
| | - | -------------------------------------------------



| | ● | the volatility of the trading
    price of our common stock; and
| | - | ----------------------------------------------------------------



| | ● | our expectations regarding
    the period during which we qualify as an emerging growth company under the Jumpstart Our Business Startups Act.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------



The
forward-looking statements contained in this report reflect our views and assumptions as of the date of this report. New risks and uncertainties
arise from time to time, and it is impossible for us to predict these events or how they may affect us. Except as required by law, we
assume no responsibility for updating any forward-looking statements.



We
qualify all of our forward-looking statements by these cautionary statements. In addition, we claim the protection of the safe harbor
for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.



3







SUMMARY OF RISK FACTORS



An investment in our common
stock is subject to broad range of risks and should only be made after a careful consideration of such risks. For a discussion of some
of the risks you should consider before purchasing our common stock, you are urged to carefully review and consider the section entitled
 “Item 1A. Risk Factors.”



Our business is subject to
a number of risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial
condition, results of operations, cash flows and prospects that you should consider before making a decision to invest in our common
stock. These risks are discussed more fully in the section titled “Risk factors” beginning on page 19 of this report,
and include the following:



Risks Related to our Financial Condition and
Capital Requirements



| | ● | We
                                            have a limited operating history, have only initiated one clinical trial and have not completed
                                            any clinical trials to date. We do not have any products approved for commercial sale and
                                            have not generated any revenue, which may make it difficult for investors to evaluate our
                                            current business and likelihood of success and viability.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | We
                                            have incurred losses since our inception and have not generated any revenue. We expect to
                                            incur continued losses for the foreseeable future and may never achieve or maintain profitability.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | Our
                                            ability to generate revenue and achieve profitability depends significantly on our ability
                                            to achieve several objectives relating to the discovery or identification, preclinical and
                                            clinical development, regulatory approval and commercialization of our current or future
                                            product candidates.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | We
                                            will require substantial additional capital to finance our operations and achieve our goals.
                                            If we are unable to raise capital when needed or on terms acceptable to us, we may be forced
                                            to delay, reduce or eliminate our research or product development programs, any future commercialization
                                            efforts or other operations.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | The
                                            COVID-19 pandemic could adversely impact our business, including our preclinical development,
                                            clinical trials and clinical trial operations.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Risks Related to the Development of our Product
Candidates



| | ● | We are substantially dependent on the
                                            success of our lead product candidate, NXP800, which commenced a Phase 1 clinical trial in
                                            December 2021.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | Clinical trials are very expensive,
                                            time consuming and difficult to design and implement, and involve uncertain outcomes. Furthermore,
                                            results of earlier preclinical studies and clinical trials may not be predictive of results
                                            of future preclinical studies or clinical trials. Our current or future product candidates
                                            may not have favorable results in later clinical trials, if any, or receive regulatory approval.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | If we fail to demonstrate safety and
                                            efficacy to our stakeholders, we may need to terminate development programs, our reputation
                                            may be harmed, and our business will suffer.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





4







Risks Related to Government Regulation



| | ● | The development and commercialization
                                            of pharmaceutical products are subject to extensive regulation, and we may not obtain regulatory
                                            approvals for NXP800, NXP900, or any future product candidate, on a timely basis or at all.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Risks Related to our Reliance on Third Parties



| | ● | The
                                            manufacture of any of our current or future product candidates is complex. Our third-party
                                            manufacturers may encounter difficulties or interruptions in production, which could delay
                                            or entirely halt their ability to supply any of our current or future product candidates
                                            for clinical trials or, if approved, for commercial sale.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Risks Related to Managing Growth and Employee
Matters





| | ● | Our
                                            future success depends on our ability to retain our executive officers and key employees
                                            and to attract, retain and motivate qualified personnel and manage our human capital.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ● | We
                                            currently have 8 full-time employees and we will need to grow the size and capabilities of
                                            our organization, and we may experience difficulties in managing this growth.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Risks Related to our Intellectual Property



| | ● | If
                                            we are unable to obtain and maintain patent protection or other necessary rights for our
                                            products and technology, or if the scope of the patent protection obtained is not sufficiently
                                            broad or our rights under licensed patents is not sufficiently broad, our competitors could
                                            develop and commercialize products and technology similar or identical to ours, and our ability
                                            to successfully commercialize our products and technology may be adversely affected.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





5









PART I



Item 1.Business



OVERVIEW



We are a biopharmaceutical company focused on
the development of innovative precision medicines for the treatment of serious unmet medical needs in oncology. Our development strategy
utilizes a precision medicine-based approach that translates key scientific insights relating to oncogenic drivers, pathway addiction
and other cancer-promoting factors into selective and potent and highly selective anticancer drugs.



CORPORATE INFORMATION



We were incorporated in July 2020 under
the laws of the State of Delaware under the name Centry Pharma, Inc., and changed our name to Nuvectis Pharma, Inc. in July 2021.
Our principal executive offices are located at 1 Bridge Plaza, 2nd Floor, Fort Lee, NJ 07024, and our telephone number is
(201) 614-3150.



We
maintain a website with the address www.nuvectis.com. We make available free of charge through our Internet website our annual reports
on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and any amendments to these reports, as
soon as reasonably practicable after we electronically file such material with, or furnish such material to, the Securities and Exchange
Commission (“SEC”). We are not including the information on our website as a part of, nor incorporating it by reference into,
this report. Additionally, the SEC maintains a website that contains annual, quarterly, and current reports, proxy statements, and other
information that issuers (including us) file electronically with the SEC. The SEC’s website address is http://www.sec.gov.



PRODUCTS UNDER DEVELOPMENT



NXP800 (HSF1-Pathway Inhibitor)



We have licensed exclusive world-wide commercial
rights to NXP800, a novel Heat Shock Factor 1 (“HSF1”) pathway inhibitor, which was developed at the Institute for Cancer
Research (“ICR”) in London, England. Our license agreement with the ICR is subject to certain milestone and royalty payments.
For additional information see section “NXP800 License Agreement”.



Scientific Background:



Cancer cells actively exploit HSF1 to overcome
diverse stresses and promote biological activities crucial for their survival, progression, immune evasion, and metastasis. This utilization
of the HSF1 pathway by the cancer cell in order to overcome stress is also referred to as an HSF1 addiction.



In preclinical studies, treatment with NXP800
inhibited tumor growth in human xenografts of ovarian cancer. In addition, we identified a gene signature related to a mutation in the
AT-Rich Interaction Domain (“ARID1a”) gene that has potential to serve as a biomarker for patient selection in ovarian and
other cancer types. Based on this work, we plan to initially study the potential efficacy of NXP800 in Ovarian Clear Cell Carcinoma (“OCCC”)
and endometrioid ovarian carcinoma, and to investigate the use of ARID1a mutations as a potential patient selection marker for additional
types of cancer. The genetic screening for the ARID1a mutation is a standard part of the commercially available screening panels being
utilized in the clinic for cancer patients.



A comprehensive preclinical data package supported
the approval of the Clinical Trial Application (“CTA”) by the Medicines and Healthcare Regulatory Agency (“MHRA”)
in the United Kingdom, and we believe that it will also be sufficient for the Investigational New Drug (“IND”) Application
submission to the FDA, which is expected in the second quarter of 2022. In December 2021, we announced the commencement of the Phase
1 study for NXP800. The Phase 1 study is comprised of two parts: dose-escalation Phase 1a, initiated in December 2021, to be followed
by an expansion Phase 1b. In the Phase 1a, the safety and tolerability of NXP800 will be evaluated in patients with advanced solid tumors
to identify a dose and dosing schedule for the Phase 1b. In the Phase 1b, the safety and preliminary anti-tumor activity of NXP800 will
be evaluated in biomarker-selected patients, initially in OCCC and endometrioid carcinoma harboring the ARID1a mutation and possibly
cohorts of patients with additional types of solid tumors. Additional preclinical studies will be conducted by the ICR and other third-party
vendors in order to assess the preclinical safety and efficacy of NXP800 in additional solid tumor types.





6







Addressing an Unmet Need in Clear Cell Ovarian Cancer and Advanced-stage
Endometrioid Ovarian Carcinoma



We plan to initially investigate NXP800 as treatment
for OCCC and endometrioid ovarian carcinoma. NXP800 is precisely targeted for women with these diseases who have either the ARID1a mutation
or ARID1a epigenetic loss.



OCCC is highly malignant, difficult to treat,
and has a very poor survival rate due to frequent recurrence after surgery and first-line treatment. First-line treatment consists of
platinum-based chemotherapy (“PBC”), for which the reported response rate in relapse/refractory, platinum resistant patients
is 1%, demonstrating a clear and dire need for a new treatment option for OCCC. OCCC represents approximately 10% of all ovarian cancer
cases in the United States, with an annual incidence of approximately 2,200 patients.



Endometrioid ovarian cancer represents approximately
10% of all diagnosed ovarian cancer cases. If diagnosed as early-stage, endometrioid ovarian tumors can typically be resected. However,
if diagnosed at later stages, these tumors have a substantially worse prognosis. Advanced, platinum-refractory, endometrioid cancer in
the United States represents approximately 30% of the endometrioid ovarian cancer segment. In this ovarian subset the progression-free
survival at three years for patients diagnosed with stage III/IV is a dismal 20% for stage III and 0% for stage IV, representing a clear
unmet cancer treatment need.



OCCC and endometrioid ovarian carcinoma are subtypes
of epithelial ovarian carcinoma whose clinical characteristics are distinct from those of high-grade serious ovarian carcinoma. They
exhibit a unique biological profile that is markedly different from those of other histologic types. The incidence of OCCC and endometrioid
among ovarian cancer patients is higher in East Asia (for example approximately 25% and 19% in Japan for OCCC and endometrioid, respectively),
than in Europe and the United States (approximately 10% for each indication).



Market Potential/Addressable Patient Population in Additional Solid
Tumor Types



Beyond our initial target indications, we believe
that NXP800 has the potential to demonstrate anti-tumor activity in several additional tumor types, such as gastric, hepatocellular,
esophageal, urothelial carcinoma and others. In vitro preclinical work has been conducted and in vivo preclinical studies are underway
to investigate the use of ARID1a mutation as a potential patient selection marker in these additional tumor types. This work could support
our use of a tumor agnostic development strategy wherein we enroll patients based on the cancer’s genetic and molecular features
without regard to the type or location of the cancer.



NXP800 Clinical Development Plan



Based on the compelling preclinical data, in
December 2021 we announced the commencement of the first-in-human Phase 1 study for NXP800 in adult patients. The Phase 1 study
consists of two parts: dose-escalation Phase 1a, initiated in December 2021, to be followed by an expansion Phase 1b. In the Phase
1a, the safety and tolerability of NXP800 will be evaluated in patients with advanced solid tumors to identify a dose and dosing schedule
for the Phase 1b. In the Phase 1b, the safety and preliminary anti-tumor activity of NXP800 will be evaluated in biomarker-selected patients,
initially in ovarian clear cell carcinoma and endometrioid carcinoma harboring the ARID1a mutation and possibly cohorts of patients with
additional types of solid tumors.



The MHRA in the United Kingdom has approved our
CTA for the Phase 1 study, and we plan to submit an IND application with the FDA in the second quarter of 2022. Our Phase 1 dose-escalation
study in the U.K. began in December 2021 and is currently ongoing.





7







NXP900 – Scientific Background



In August 2021, we licensed worldwide commercial
rights to NXP900 from the University of Edinburgh in Scotland. NXP900 is a preclinical-stage, targeted-therapy, small molecule drug candidate
designed to preferentially inhibit the Proto-oncogene c-Src (“SRC”) and YES1 kinases. We started the preclinical IND-enabling
studies for NXP900 in the fourth quarter of 2021. Following the IND-enabling studies, we plan to submit an IND application with the FDA,
or an equivalent submission with a foreign agency, in order to begin a Phase 1 dose-escalation study of NXP900 in solid tumors. Subsequently,
upon successful completion of the dose-escalation study, we plan to conduct a clinical trial to investigate NXP900 in solid tumors where
the SRC and/or YES1 pathways are overactivated and implicated.



SRC as an Anti-Cancer Target



SRC is aberrantly activated in many cancer types,
including solid tumor cancers such as breast, colon, prostate, pancreatic and ovarian cancers, while remaining predominantly inactive
in non-cancerous cells. Increased SRC activity is generally associated with late-stage cancers, metastatic potential and resistance to
therapies, and correlates with poor clinical prognosis. To date no kinase inhibitor has been approved for the treatment of SRC-active
solid tumor malignancies.



NXP900’s Novel Mechanism of Action



SRC pathway activation is regulated by a switch
between inactive and active conformations. The inactive conformation of SRC family kinases is associated with lack of membrane binding,
lack of phosphorylation of the activation loop, and characterized by a “closed conformation.” The active “open”
conformation allows for the binding of SRC to signaling partners and enables full activation of the pathway via SRC’s kinase catalytic
activity and the scaffolding property.



Unlike the approved and clinical-stage SRC kinase
inhibitors, NXP900 induces and locks the SRC kinase in its native inactive conformation which inhibits both the catalytic (enzymatic)
and scaffolding functions. The existing SRC inhibitor drugs only inhibit the catalytic functions of SRC which enable it to bind to its
signaling partners with the pathway remaining partially active. NXP900 is a highly specific inhibitor and, unlike many other SRC inhibitors,
does not inhibit the Abelson tyrosine kinase (“ABL”), and as such, NXP900 in vivo data indicates no treatment related
immunosuppression. The lack of immunosuppressive effects with NXP900 is a potential advantage in the setting of solid tumors.



NXP900's unique mechanism of action, which leads
to inactivation of the SRC kinase, has resulted in SRC-pathway inhibition in vitro and in vivo. In vivo, treatment with NXP900 inhibited
primary and metastatic tumor growth in xenograft models of triple negative breast cancer and demonstrated on-target pharmacodynamic effects.
This novel mode of inhibiting SRC by NXP900 could lead to improved treatment of SRC-associated oncologic disorders and the potential
to treat solid tumors for the first time with a SRC inhibitor.



Gene amplification of the site containing the
YES1 gene has been reported in clinical samples in several tumors including lung, head and neck, bladder and esophageal cancers. Furthermore,
it has been found that YES1 gene amplification is a key mechanism of resistance to Epidermal Growth Factor Receptor (“EGFR”)
or Human Epidermal growth factor Receptor 2 (“HER2”) inhibitors. YES1-dependent oncogenic transformation has also been reported,
suggesting that YES1 plays a key role in these solid tumors. The transforming ability of YES1 has been demonstrated through several
experimental methods, for example down-regulating YES1 by short hairpin RNA (“shRNA”) significantly inhibited cell growth
in several malignancies, including colon carcinoma, rhabdomyosarcoma, and basal-like breast cancer, suggesting YES1 may play a key role
in these solid tumors.



NXP900 has been shown to inhibit the YES1 kinase
in preclinical models, providing an additional potential target for pharmacological inhibition by NXP900 of a biologically-relevant target
in various cancer types, some of which may rely on both the SRC and YES1 pathways for their advantage. There are no selective YES1 inhibitors
that are FDA approved or in clinical development. We plan to conduct in vivo studies to better understand the effects of YES1 inhibition
in solid tumors.





8







OUR STRATEGY



We have a mission-driven strategy to build a
global biopharmaceutical company through the identification, licensing, development, and commercialization of therapeutics to address
unmet medical needs in oncology, with an initial focus on OCCC and endometrioid ovarian carcinoma patients. The key elements driving
our business strategy include:



| | ➢ | establishing
                                            a leadership position in oncology therapeutics, targeting the inhibition of the HSF1 pathway
                                            utilizing the ARID1a mutation as a biomarker;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | advancing
                                            our lead product candidate, NXP800, through clinical development towards regulatory approval
                                            in OCCC and endometrioid cancers;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | maximizing
                                            the therapeutic potential for NXP800 by leveraging preclinical data in additional tumor types
                                            harboring the ARID1a mutation, both as a monotherapy and possibly in combination with other
                                            approved therapies;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | positioning
                                            NXP900 as a differentiated SRC kinase inhibitor with improved therapeutic activity in solid
                                            tumors compared to the existing SRC kinase inhibitors;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | maximizing
                                            the therapeutic potential of NXP900 by generating additional preclinical data to highlight
                                            the benefits of YES1 inhibition;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | deploying
                                            our differentiated and proven business development expertise to further expand our targeted
                                            oncology pipeline for patients with unmet medical needs; and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | evaluating
                                            opportunities to accelerate development timelines and enhance the commercial potential of
                                            our programs in collaboration with third parties, including potential ex-U.S. collaboration
                                            opportunities.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



INTELLECTUAL PROPERTY



We strive to protect the proprietary technologies
that we believe are important to our business, including pursuing, obtaining and maintaining patent protection intended to cover the
composition of matter of our current or future product candidates, their methods of use, related technologies and other inventions that
are important to our business. In addition to patent protection, we also rely on trade secrets to protect aspects of our business that
are not amenable to, or that we do not consider appropriate for, patent protection. We also rely on know-how and continuing technological
innovation to develop and maintain our proprietary and intellectual property position.



As with other biotechnology and biopharmaceutical
companies, our commercial success depends in part upon our ability to obtain, maintain, enforce, and protect our patents, intellectual
property, and other proprietary rights for our current or future product candidates and other commercially important technologies, inventions,
improvements, and know-how related to our business. Our success also depends on our ability to defend and enforce our intellectual property,
any patent rights that we may own or in-license, prevent others from infringing any patents we may own or in-license, preserve the confidentiality
of our trade secrets, and operate without infringing the valid and enforceable intellectual property and proprietary rights of third
parties.



Our ability to maintain and solidify our proprietary
and intellectual property position for our current or future product candidates and technologies depends on our success in obtaining
effective patent claims and enforcing those claims if granted. However, our current patent applications and any patent applications that
we may in the future file or license from third parties may not result in the issuance of patents, and any issued patents we may obtain
may not guarantee us the right to practice our technology in relation to the commercialization of our products. We also cannot predict
the breadth of claims that may be allowed or enforced in any patents we may own or in-license in the future.





9







The patent positions for biotechnology and biopharmaceutical
companies like us are generally uncertain and can involve complex legal, scientific, and factual issues. We cannot predict whether the
patent applications we are currently pursuing will issue as patents in any particular jurisdiction or whether the claims of any issued
patents will provide sufficient proprietary protection from competitors. Any issued patents that we may own or in-license in the future
may be challenged, invalidated, circumvented, or have the scope of their claims narrowed. Furthermore, the coverage claimed in a patent
application can be significantly reduced before a patent is issued, and its scope can be reinterpreted and even challenged after issuance.



Moreover, many jurisdictions permit third parties
to challenge issued patents in administrative proceedings, which may result in further narrowing or even cancellation of patent claims.
As a result, we cannot guarantee that any of our current or future product candidates will be protected or remain protectable by enforceable
patents. Moreover, any patents that we hold may be challenged, circumvented or invalidated by third parties. We cannot be certain of
the priority of inventions covered by pending third-party patent applications. If third parties prepare and file patent applications
in the United States that also claim technology or therapeutics to which we have rights, we may have to participate in interference proceedings
in the U.S. Patent and Trademark Office (“USPTO”) to determine priority of invention, which could result in substantial costs
to us, even if the eventual outcome is favorable to us, which is highly unpredictable. In addition, because of the extensive time required
for clinical development and regulatory review of any current or future product candidate we may develop, it is possible that, before
any current or future product candidates can be commercialized, any related patent may expire or remain in force for only a short period
following commercialization, thereby limiting the protection such patent would afford the respective product and any competitive advantage
such patent may provide.



In May 2021, we licensed one patent family
covering the composition of matter for NXP800, which includes two issued U.S. patents as well as methods of using and making NXP800.
Composition of matter patents in this family have also been issued in other major markets, including Australia, Brazil, China, India, Israel,
Mexico, Russia, Singapore, the European Union and Japan. The statutory expiration for patents in this family is October 2034, without
taking into account any possible patent term extension, where applicable. We licensed a patent family directed to additional compounds,
structurally distinct from NXP800, that modulate HSF1. This patent family is granted in the U.S. and has a statutory expiration of April 2036.
We have also licensed a patent family pending in the U.S. and Europe directed to deuterated compounds that modulate HSF1. Any patent
that grants from this family would have a statutory expiration of October 2037. We intend to pursue additional patent protection
for NXP800 relating to methods of use and related technologies that we consider important to our business.



In August 2021, we licensed one patent family
covering the composition of matter for NXP900, which includes one U.S. patent covering the composition of matter for NXP900, as well
as patents and patent applications issued/pending in major markets, including the European Union and Japan. The statutory expiration
for patents in this patent family is April 2036, without taking into account any possible patent term extension, where applicable.



The term of individual patents depends upon the
legal term of the patents in the countries in which they are obtained. In most countries in which we file, the patent term is 20 years
from the earliest date of filing a non- provisional patent application. In the United States, the term of a patent covering an FDA-approved
drug may, in certain cases, be eligible for a patent term extension under the Hatch-Waxman Act as compensation for the loss of patent
term during the FDA regulatory review process. The period of extension may be up to five years but cannot extend the remaining term of
a patent beyond a total of 14 years from the date of product approval. Only one patent applicable to an approved drug is eligible for
extension and only those claims covering the approved drug, a method for using it, or a method for manufacturing it may be extended.
Similar provisions are available in Europe and in certain other jurisdictions to extend the term of a patent that covers an approved
drug. It is possible that issued U.S. patents covering NXP800 and NXP900, may or will be entitled to patent term extensions. If our current
or future product candidates receive FDA approval, we intend to apply for patent term extensions, if available, to extend the term of
patents that cover any approved product candidates. We also intend to seek patent term extensions in any jurisdictions where they are
available; however, there is no guarantee that the applicable authorities, including the FDA, will agree with our assessment of whether
such extensions should be granted, and even if granted, the length of such extensions.



In addition to patent protection, we also rely
on trade secret protection for our proprietary information that is not amenable to, or that we do not consider appropriate for, patent
protection, including certain aspect of our manufacturing processes. However, trade secrets can be difficult to protect. Although we
take steps to protect our proprietary information, including restricting access to our confidential information, as well as entering
into non-disclosure and confidentiality agreements with our employees, consultants, independent contractors, advisors, contract manufacturers,
clinical research organizations (“CROs”), hospitals, independent treatment centers, suppliers, collaborators and other third
parties, such parties may breach such agreements and disclose our proprietary information including our trade secrets, and we may not
be able to obtain adequate remedies for such breaches. In addition, third parties may independently develop the same or similar proprietary
information or may otherwise gain access to our proprietary information. As a result, we may be unable to meaningfully protect our trade
secrets and proprietary information. For more information regarding the risks related to our intellectual property, please see “Risk
Factors - Risks Related to Our Intellectual Property.”





10







NXP800 License Agreement



In May 2021, we entered into a worldwide,
exclusive license agreement with the CRT Pioneer Fund (“CRT”) for NXP800 and any of its derivatives (collectively, the “NXP800
Program”). NXP800 is a small molecule product candidate that we believe can be applied to a broad range of cancers.



Pursuant to the license agreement, we have an
obligation to pay success-based milestones and royalties to CRT, as follows:



| | ➢ | pre-approval
                                            milestone payments of up to approximately $26.5 million including an upfront payment of $3.5
                                            million which has already been paid;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | regulatory
                                            approval and commercial sales milestones of up $178 million; and
| | - | -----------------------------------------------------------------------------------------------------------------------



| | ➢ | mid-single
                                            digit to 10% royalties on a tiered basis on net sales.
| | - | -------------------------------------------------------------------------------------------------------------



In addition, in connection with the licensing
agreement, we expect to provide ICR with up to an additional $500,000 in research and development support over the next 18 months to
conduct additional scientific research and preclinical testing for certain indications that we select in connection with the NXP800 Program.
We own an exclusive license to intellectual property rights developed in the collaboration, to research, develop and commercialize products
resulting from the collaboration.



License Term



The license will remain in effect in each territory
subject to the license and will continue until our obligation to pay royalties in such territory has expired. The royalty term for each
licensed product in each country commences with the first commercial sale of the applicable licensed product in the applicable country
and ending on the expiration of the last to expire of any patent specified by the license (with the key composition of matters patent
expiring October 2034) or the expiration of any extended exclusivity period in the relevant country. CRT may earlier terminate the
license if we, or any of our affiliates or sub-licensees, challenge or seek to challenge the validity of any of the licensed patents
or upon certain change of control provisions. Either party may terminate the license upon material breach by the other party, and upon
the appointment of a receiver or upon a winding-up order or similar or equivalent action.



NXP900 License Agreement



In August 2021, we entered into a worldwide,
exclusive license agreement with the University of Edinburgh (“UoE”) for NXP900 and any of its derivatives (collectively,
the “NXP900 Program”). Discovered at the UoE, NXP900 is a targeted therapy, small molecule SRC and YES1 kinase inhibitor
product candidate that we believe can be applied to a broad range of cancers.





11







Pursuant to the license agreement, we have an
obligation to pay success-based milestones and royalties to the UoE, as follows:



| | ➢ | pre-approval
                                            milestone payments of up to approximately $49.5 million including an upfront payment of $3.5
                                            million which has already been paid;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | regulatory approval
                                            and commercial sales milestones of up $279.5 million;
| | - | ---------------------------------------------------------------------------------------------------------------------



| | ➢ | mid-single digit to
                                            8% royalties on a tiered basis on net sales; and
| | - | ----------------------------------------------------------------------------------------------------------------



| | ➢ | 2.5%
                                            of the gross amount of each Nuvectis fundraising, including our initial public offering,
                                            up to an aggregate total of $3.0 million.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In addition, in connection with the license agreement,
we expect to provide the UoE with up to an additional £580,000 in research and development support over the next 18 months to conduct
additional scientific research and preclinical testing for certain indications that we select in connection with the NXP900 Program.
We own an exclusive license to intellectual property rights developed in the collaboration, to research, develop and commercialize products
resulting from the collaboration.



License Term



The royalty term for each licensed product in
each country is the period commencing with first commercial sale of the applicable licensed product in the applicable country and ending
on the expiration of the last to expire of any patent specified by the license (statutory expiration for the NXP900 patent family is
April 2036), or the expiration of any extended exclusivity period in the relevant country. We may terminate the license if we determine
that it is not scientifically or commercially viable to research, develop, or commercialize the licensed products which are the subject
of the license agreement. UoE may terminate the agreement if we: (i) cease to carry on the business regarding the treatment, prevention
and/or diagnosis of human diseases; (ii) discontinue the development of the licensed products which are the subject of the license;
(iii) dispose of our assets or business in whole or in material part; (iv) challenge the validity, ownership, or enforceability
of the exclusively licensed technology; (v) contest the secret or substantial nature of certain know-how subject to the license;
or (vi) breach certain diligence obligations or fail to pay any amount due under the license within a specified time frame. The
parties may terminate the NXP900 license agreement immediately by written notice upon material breach by the other party, if such breach
(if capable of cure) is not so cured within thirty (30) business days following the notice of breach.



Competition



Our industry is intensely competitive and subject
to rapid and significant technological changes. We face competition with respect to our current product candidates, and will face competition
with respect to future product candidates, from segments of the pharmaceutical, biotechnology and other related markets. There are several
companies that are developing drugs for various types of ovarian cancer, including ImmunoGen, Inc. and Constellation Pharmaceuticals, Inc.
(acquired by MorphoSys AG in June 2021). MorphoSys AG disclosed patient recruitment commenced in May 2021 in a phase 2 expansion
cohort for CPI-0209 in patients with relapsed urothelial carcinoma, relapsed OCCC, and relapsed endometrial carcinoma, all with known
ARID1A mutations.



Turning Point Therapeutics, Inc. (“Turning
Point”) is developing a MET/SRC/CSF1R inhibitor which is currently being studied in a Phase 1 trial of patients with advanced or
metastatic solid tumors harboring Mesenchymal–Epithelial Transition (“MET”) genetic alterations. The simultaneous inhibition
of MET, SRC and CSF1R kinases has been reported by Turning Point as a key component of the target product profile, and Turning Point
has described the program as a strategy for the treatment of MET-driven solid tumors, an area that does not overlap with our development
strategy. Turning Point is also developing TPX-0046, a Rearranged during Transfection (“RET”) kinase inhibitor that can also
inhibit other kinases including SRC family members, YES1, ABl, TRK and JAK2. TPX-0046 is being evaluated in an ongoing Phase 1/2 clinical
trial for the treatment of advanced solid tumors with RET gene alterations, an area that does not overlap with our development strategy.



Our competitors may obtain regulatory approval
of their products more rapidly than us, or may obtain patent protection or other intellectual property rights that limit our ability
to develop or commercialize our current or future product candidates. Our competitors may also develop drugs that are more effective,
more convenient, more widely used and less costly, or have a better safety profile than our products; and these competitors may also
be more successful than us in manufacturing and marketing their products.





12







In addition, we may need to develop our current or future product
candidates in collaboration with diagnostic companies, and we will face competition from other companies in establishing these collaborations.
Our competitors will also compete with us in recruiting and retaining qualified scientific, management and commercial personnel, establishing
clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary
for, our programs.



The acquisition or licensing of pharmaceutical
products is also very competitive. If we seek to acquire or license products, we will face substantial competition from a number of more
established companies, some of which have acknowledged strategies to license or acquire products and many of which are bigger than us
and have more institutional experience and greater cash positions or flows than we have. These more established companies may have competitive
advantages over us, as may other emerging companies taking similar or different approaches to product licenses and/or acquisitions. In
addition, a number of established research-based pharmaceutical and biotechnology companies may acquire products in late stages of development
to augment their internal product lines, which may provide those companies with an even greater competitive advantage.



Supply and Manufacturing



We do not have any manufacturing facilities.
We currently rely, and expect to continue to rely, on third-party manufacturers, including a single-manufacturer to make the NXP800 drug
substance and a single-manufacturer to make the NXP800 drug product. With respect to NXP900, to date, the drug substance has been manufactured
by a non-good manufacturing practices (“non-GMP”) manufacturer for research purposes at lab scale. We will need to identify
a third-party manufacturer(s) compliant with current good manufacturing practices (“cGMP”) for the production of NXP900
drug substance and drug product. With any supply program, obtaining raw materials of the correct
quality cannot be guaranteed and we cannot ensure that we will be successful in these endeavors.



We plan to continue to rely on third-party manufacturers
for the supply of NXP800 and NXP900, for manufacture of future additional product candidates, for preclinical testing as well as for
clinical trials and commercial manufacture if our current or future product candidates receive marketing approval.



GOVERNMENT REGULATION



Numerous governmental authorities, principally
the FDA, as well other state and foreign regulatory agencies impose substantial regulatory requirements
upon the clinical development, manufacture and marketing of our product candidates, as well as our ongoing research and development activities.
Before marketing in the U.S., any drug that we develop must undergo rigorous preclinical testing and clinical trials and an extensive
regulatory approval process implemented by the FDA under the Food, Drug and Cosmetic Act of 1930. The FDA regulates, among other things,
the pre-clinical and clinical testing, safety, efficacy, approval, manufacturing, record keeping, adverse event reporting, packaging,
labeling, storage, advertising, promotion, export, sale and distribution of biopharmaceutical products.If we fail to comply with
applicable FDA or other legal requirements, we may become subject to administrative or judicial sanctions or other legal consequences.
These sanctions or consequences may include, among other things, the FDA’s denial of our pending applications, the issuance of
clinical holds for ongoing studies, suspension or revocation of approved applications, warning or untitled letters, product withdrawals
or recalls, product seizures, relabeling or repackaging, total or partial suspensions of manufacturing or distribution, injunctions,
fines, civil penalties or criminal prosecution.



The clinical testing and approval processes require
substantial time, effort, and financial resources, and we cannot be certain that any approvals for our current or future product candidates
will be granted on a timely basis, if at all. We, along with our vendors, contract research organizations and contract manufacturers,
will be required to navigate the various preclinical, clinical, manufacturing and commercial requirements of the FDA, as well as those
of any other governing regulatory agency of the countries in which we wish to conduct studies or seek approval of our current or future
product candidates. The process of obtaining regulatory approvals of drugs and ensuring subsequent compliance with appropriate federal,
state, local and foreign statutes and regulations requires the expenditure of substantial time and financial resources.





13







Preclinical and clinical trials for drugs



Before testing any drug in humans, a product
candidate must undergo rigorous preclinical testing. Preclinical studies include laboratory evaluations of drug chemistry, formulation
and stability, as well as in vitro and animal studies to assess safety and address use concerns. The conduct of preclinical studies is
subject to federal and state regulations and requirements, including good clinical practice (“GCP”) requirements for safety/toxicology
studies. The results of the preclinical studies, together with manufacturing information and analytical data must be submitted to the
FDA as part of an IND application. An IND application is a request for authorization from the FDA to administer an investigational product
to humans and must become effective before clinical trials may begin. Some long-term preclinical testing may continue after the IND application
is submitted. An IND application automatically becomes effective 30 days after receipt by the FDA unless the FDA raises concerns or questions
about any portion of the IND application and imposes a clinical hold. In such a case, the IND sponsor and the FDA need to resolve any
outstanding concerns before the clinical trial can begin. Submission of an IND application may result in the FDA not allowing clinical
trials to commence or not allowing clinical trials to commence on the terms originally specified in the IND application. A separate submission
to an existing IND application must also be made for each successive clinical trial conducted during product development of a product
candidate, and the FDA must grant permission, either explicitly or implicitly by not objecting, before each clinical trial can begin.



Clinical development of product candidates to
support New Drug Applications (“NDAs”) are typically conducted in three sequential phases, which may overlap:



| | ➢ | Phase
                                            1: The investigational product is initially introduced into healthy human volunteers. These
                                            studies are typically designed to test the safety, dosage tolerance, absorption, metabolism,
                                            excretion and distribution of the investigational product in humans, the side effects associated
                                            with increasing doses, and, if possible, to gain early evidence of efficacy. In the case
                                            of some products for severe or life-threatening diseases, such as cancer, especially when
                                            the product may be too inherently toxic to ethically administer to healthy volunteers, the
                                            initial human testing is often conducted in patients.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | Phase
                                            2: This phase typically involves administration of the investigational product to a limited
                                            patient population with a specified disease or condition to determine optimal dosages, dosage
                                            tolerance and dosing schedule, to identify possible adverse side effects and safety risks,
                                            and to preliminarily evaluate the efficacy of the product candidate for specific targeted
                                            diseases.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | Phase
                                            3: This phase typically involves administration of the investigational product to an expanded
                                            patient population to provide significant evidence of clinical efficacy and to further test
                                            for safety, generally at multiple and often geographically dispersed clinical trial sites.
                                            These clinical trials are intended to provide the primary basis for the overall risk/benefit
                                            ratio of the investigational product and to enable regulatory decision-making of product
                                            approval and physician labeling. These trials may include comparisons with placebo and/or
                                            other comparator treatments. The duration of treatment is often extended to mimic the actual
                                            use of a product during marketing.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | Phase
                                            4: Post-approval trials, sometimes referred to as Phase 4 clinical trials, may be conducted
                                            after initial marketing approval. These trials are used to gain additional experience from
                                            the treatment of patients in the intended therapeutic indication. In certain instances, the
                                            FDA may mandate the performance of Phase 4 clinical trials as a condition of approval of
                                            an NDA.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Expedited development and review programs



The FDA is authorized to designate certain products
for expedited development or review if they are intended to address an unmet medical need in the treatment of a serious or life-threatening
disease or condition. These programs include fast track designation, breakthrough therapy designation and priority review designation.





14







A new drug is eligible for fast track designation
if it is intended to treat a serious or life-threatening disease or condition and demonstrates the potential to address an unmet medical
need for such disease or condition. Fast track designation provides increased opportunities for sponsor interactions with the FDA during
preclinical and clinical development, in addition to the potential for rolling review of a marketing application once a marketing application
is filed, meaning that the agency may review portions of the application before the sponsor submits the complete application, as well
as priority review, discussed below. In addition, a new drug may be eligible for breakthrough therapy designation if it is intended,
alone or in combination with one or more other drugs or biologics, to treat a serious or life-threatening disease or condition and preliminary
clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant
endpoints, such as substantial treatment effects observed early in clinical development. Breakthrough therapy designation provides all
the features of fast track designation in addition to intensive guidance on an efficient drug development program beginning as early
as Phase 1, and FDA organizational commitment to expedited development, including involvement of senior managers and experienced review
staff in a cross-disciplinary review, where appropriate. Drugs or biologics designated as breakthrough therapies are also eligible for
accelerated approval of their respective marketing applications.



Finally, the FDA may designate a product for
priority review if it is a drug or biologic that treats a serious condition and, if approved, would provide a significant improvement
in safety or effectiveness. The FDA determines at the time that the marketing application is submitted, on a case-by-case basis, whether
the proposed drug represents a significant improvement in treatment, prevention or diagnosis of disease when compared with other available
therapies. Significant improvement may be illustrated by evidence of increased effectiveness in the treatment of a condition, elimination
or substantial reduction of a treatment-limiting drug reaction, documented enhancement of patient compliance that may lead to improvement
in serious outcomes, or evidence of safety and effectiveness in a new subpopulation. A priority review designation is intended to direct
overall attention and resources to the evaluation of such applications, and to shorten the FDA’s goal for taking action on a marketing
application from ten months to six months for a new molecular entity NDA from the date of filing.



Even if a product qualifies for one or more of
these programs, the FDA may later decide that the product no longer meets the conditions for qualification or decide that the time period
for FDA review or approval will not be shortened. Furthermore, fast track designation, breakthrough therapy designation and priority
review do not change the standards for approval and may not ultimately expedite the development or approval process.



Other regulatory matters



Manufacturing, sales, promotion and other activities
of product candidates following product approval, where applicable, or commercialization are also subject to regulation by numerous regulatory
authorities in the United States in addition to the FDA, which may include the Centers for Medicare & Medicaid Services (“CMS”)
an agency within the U.S. Department of Health and Human Services (“HSS”), other divisions of the Department of Health and
Human Services, the Department of Justice, the Drug Enforcement Administration, the Consumer Product Safety Commission, the Federal Trade
Commission, the Occupational Safety & Health Administration, the Environmental Protection Agency and state and local governments
and governmental agencies.



Other healthcare laws



Healthcare providers, physicians, and third-party
payors will play a primary role in the recommendation and prescription of any products for which we obtain marketing approval. Our business
operations and any current or future arrangements with third-party payors, healthcare providers and physicians may expose us to broadly
applicable fraud and abuse and other healthcare laws and regulations that may constrain the business or financial arrangements and relationships
through which we develop, market, sell and distribute any drugs for which we obtain marketing approval. In the United States, these laws
include, without limitation, state and federal anti-kickback, false claims, physician transparency, and patient data privacy and security
laws and regulations. For a description of these risks, please see the section entitled “Risk Factors.”





15







Current and future healthcare reform legislation



The FDA’s and other regulatory authorities’
policies may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our
current or future product candidates. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements
or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we otherwise may have obtained
and we may not achieve or sustain profitability, which would adversely affect our business, prospects, financial condition and results
of operations.



In recent years, there has been heightened governmental
scrutiny over the manner in which biopharmaceutical manufacturers set prices for their marketed products. Such scrutiny has resulted
in several recent U.S. Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things,
bring more transparency to drug pricing, review the relationship between pricing and manufacturer patient programs, reduce the cost of
drugs under Medicare, and reform government program reimbursement methodologies for pharmaceutical products. Congress and the executive
branch have each indicated that it will continue to seek new legislative and/or administrative measures to control drug costs, making
this area subject to ongoing uncertainty.



Other U.S. environmental, health and safety laws and regulations



We may be subject to numerous environmental,
health and safety laws and regulations, including those governing laboratory procedures and the handling, use, storage, treatment and
disposal of hazardous materials and wastes. From time to time and in the future, our operations may involve the use of hazardous and
flammable materials, including chemicals and biological materials, and may also produce hazardous waste products. Even if we contract
with third parties for the disposal of these materials and waste products, we cannot completely eliminate the risk of contamination or
injury resulting from these materials. In the event of contamination or injury resulting from the use or disposal of our hazardous materials,
we could be held liable for any resulting damages, and any liability could exceed our resources. We also could incur significant costs
associated with civil or criminal fines and penalties for failure to comply with such laws and regulations.



We maintain workers’ compensation insurance
to cover us for costs and expenses we may incur due to injuries to our employees, but this insurance may not provide adequate coverage
against potential liabilities. However, we do not maintain insurance for environmental liability or toxic tort claims that may be asserted
against us. In addition, we may incur substantial costs in order to comply with current or future environmental, health and safety laws
and regulations. Current or future environmental laws and regulations may impair our research, development or production efforts. In
addition, failure to comply with these laws and regulations may result in substantial fines, penalties or other sanctions.



Government regulation of drugs outside of the United States



In addition
to regulations in the United States, there are a variety of foreign regulations governing clinical trials and commercial sales and distribution
of any product candidates. The approval process varies from country to country, and the time may be longer or shorter than that required
for FDA approval.



EMPLOYEES AND HUMAN CAPITAL MANAGEMENT



As of March 22, 2022, we had 8 full-time
employees. Additionally, we have retained and may retain in the future, a number of expert consultants and vendors that help navigate
us through and execute the different aspects of our business. We consider our relationship with our employees to be good and have not
experienced any work stoppages, slowdowns or other serious labor problems that have materially impeded our business operations. None
of our employees are represented by labor unions or covered by collective bargaining agreements.



Our human capital management objectives include,
as applicable, identifying, recruiting, retaining, incentivizing, and integrating our new and existing employees. The principal purpose
of our equity incentive plan is to attract, retain, and motivate selected employees, consultants, and directors through the granting
of stock-based compensation awards and cash-based bonus awards.





16







Item 1A.Risk
Factors



Investing in our common stock involves a high
degree of risk. You should consider carefully the risks and uncertainties described below, together with all of the other information
in this report, including the section titled “Management’s Discussion and Analysis of Financial Condition and Results of
Operations” and our financial statements and related notes, before making a decision to invest in our common stock. Our business,
results of operations, financial condition and prospects could also be harmed by risks and uncertainties that are not presently known
to us or that we currently believe are not material. If any of the risks actually occur, our business, platform, reputation, brand, results
of operations, financial condition and prospects could be materially and adversely affected. In such event, the market price of our common
stock could decline, and you could lose all or part of your investment.



Risks Related to Our Finances and Capital Requirements



Our limited operating history may make
it difficult for you to evaluate the success of our business to date and to assess our future viability.



We are a clinical stage biopharmaceutical company
with a limited operating history. We were incorporated in Delaware in July 2020 and commenced operations in May 2021. Our operations
to date have been limited to organizing and staffing our company, business planning, raising capital, identifying, investigating, licensing
and evaluating potential product candidates, and establishing arrangements with third parties for the manufacture of initial quantities
of our lead product candidate and component materials. Our lead product candidate is in early clinical development, and our second drug
candidate is in preclinical development. We have not yet demonstrated our ability to successfully initiate, conduct or complete any clinical
trials, obtain marketing approvals, manufacture a commercial-scale product or arrange for a third party to do so on our behalf, or conduct
sales, marketing and distribution activities necessary for successful product commercialization. Consequently, any predictions about
our future success or viability may not be as accurate.



We will need to transition at some point from
a company with a research and development focus to a company capable of supporting commercial activities related to the full product
life cycle. We may not be successful in such a transition.



We have incurred losses since inception
and anticipate that we will continue to incur losses for the foreseeable future. We may never achieve or maintain profitability.



Investment in biopharmaceutical product development
is a highly speculative undertaking and entails substantial upfront capital expenditures and significant risk that our current or potential
future product candidates will fail to demonstrate adequate efficacy or an acceptable safety profile, gain regulatory approval and become
commercially viable. We are still in the early stages of development of our product candidates and initiated our first clinical trial
in December 2021. We have no products approved for commercial sale and have not generated any revenue from product sales to date.
We continue to incur significant research and development and other expenses related to our ongoing operations. In addition, as a business
with a limited operating history, we may encounter unforeseen expenses, difficulties, complications, delays and other known and unknown
factors, such as the COVID-19 pandemic.



We have incurred losses in each period since
we commenced operations. Since inception through the end of December 31, 2021, we had an accumulated deficit of $12.9 million. Those
losses mainly include the following: (1) In June 2021, in connection with the exclusive licensing agreement related to our
lead product candidate, NXP800, we paid an upfront payment of $3.5 million, and (2) In September 2021, in connection with the
exclusive licensing agreement related to NXP900, we also paid an upfront payment of $3.5 million. We expect to continue to incur significant
losses for the foreseeable future, and we expect these losses to increase substantially if and as we continue our research and development
efforts and submit IND applications for our lead product candidate; conduct preclinical studies and clinical trials for our current and
future product candidates; seek marketing approvals for any current or future product candidate that successfully completes clinical
trials; experience any delays or encounter any issues with any of the above; establish a sales, marketing and distribution infrastructure
and scale-up manufacturing capabilities to commercialize any current or future product candidates for which we may obtain regulatory
approval; obtain, expand, maintain, enforce and protect our intellectual property portfolio; hire additional clinical, regulatory and
scientific personnel; and operate as a public company.





17







Our lead product candidate, NXP800, is in clinical
development and our second product candidate, NXP900, is in the preclinical stage of development. Both product candidates will require
additional preclinical studies, clinical development, regulatory review and approval, substantial investment, access to sufficient clinical
and commercial manufacturing capacity and significant marketing efforts before we can generate any revenue from product sales. The Phase
1 study for NXP800 started in December 2021 and NXP900 has yet to enter clinical trials. To date, we have not generated any revenue
from our product candidates. Our ability to generate revenue will depend on a number of factors, including, but not limited to:



| | ➢ | the
                                            timely completion of our preclinical studies and clinical trials, which may be significantly
                                            slower or more costly than anticipated and will depend upon the performance of third-party
                                            contractors;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | successful
                                            submissions of IND applications to the FDA and any additional comparable applications;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | completion of IND enabling
                                            studies necessary for the IND or comparable submission, as appropriate;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | whether
                                            we are required by the FDA or similar foreign regulatory authorities to conduct additional
                                            clinical trials or other studies to support the approval and commercialization of our current
                                            or future product candidates;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            FDA’s and similar foreign regulatory authorities’ acceptance of the safety, potency,
                                            purity, efficacy and risk to benefit profile of our current or future product candidates;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            prevalence, duration and severity of potential side effects or other safety issues experienced
                                            with our current or future product candidates, if any;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            timely receipt of necessary marketing approvals from the FDA and similar foreign regulatory
                                            authorities;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            actual and perceived availability, cost, risk profile and safety and efficacy of our current
                                            or future product candidates, if approved, relative to existing and future alternative cancer
                                            therapies and competitive product candidates and technologies;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | our
                                            ability and the ability of third parties with whom we contract to manufacture adequate clinical
                                            and commercial supplies of our current or future product candidates, to remain in good standing
                                            with regulatory authorities and to develop, validate and maintain commercially viable manufacturing
                                            processes that are compliant with cGMP;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | our
                                            ability to successfully develop a commercial strategy and to commercialize any current or
                                            future product candidate in the United States and internationally, if approved for marketing,
                                            reimbursement, sale and distribution in such countries and territories, whether alone or
                                            in collaboration with others;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | patient demand for
                                            our current or future product candidates, if approved; and
| | - | -------------------------------------------------------------------------------------------------------------------------



| | ➢ | our
                                            ability to establish and enforce intellectual property rights in and to our current or future
                                            product candidates.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Many of the factors listed above are beyond our
control and could cause us to experience significant delays or prevent us from obtaining regulatory approvals or commercializing our
current and future product candidates. Even if we can commercialize any current or future product candidates, we may not achieve profitability
soon after generating product sales, if ever.





18











We will require substantial additional
funding. Raising additional capital may cause dilution to our existing stockholders, or require us to relinquish proprietary rights.
If we are unable to raise capital as needed, we may be compelled to delay, reduce or eliminate our product development programs or commercialization
efforts.



We expect our expenses to increase in parallel
with our ongoing activities, particularly as we continue our discovery and preclinical development activities to identify new product
candidates and initiate clinical trials of, and seek marketing approval for, any of our current or future product candidates. In addition,
if we obtain marketing approval for any of our current or future product candidates, we expect to incur significant commercialization
expenses related to product sales, marketing, manufacturing, and distribution. Furthermore, we expect to incur significant additional
costs associated with operating as a public company. Accordingly, we will need to obtain substantial additional funding in connection
with our continuing operations. We cannot be certain that additional funding will be available on acceptable terms, or at all. Until
such time, if ever, as we can generate substantial product revenue, we expect to finance our operations through a combination of public
or private equity offerings, debt financings, governmental funding, collaborations, strategic partnerships and alliances or marketing,
distribution or licensing arrangements with third parties. To the extent that we raise additional capital through the sale of equity
or convertible debt securities, your ownership interest will be diluted, and the terms of these securities may include liquidation or
other preferences that adversely affect your rights as a stockholder. Debt financing and preferred equity financing, if available, may
involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional
debt, making capital expenditures or declaring dividends.



If we raise additional funds through collaborations,
strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights
to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable
to us.



If we are unable to raise capital when needed
or on attractive terms, we could be forced to delay, reduce or eliminate our discovery and preclinical development programs or any future
commercialization efforts.



Major public health issues, and specifically
the pandemic caused by the coronavirus COVID-19 outbreak, could have an adverse effect on our clinical trials, financial condition, results
of operations, and other aspects of our business.



In March 2020, the World Health Organization
declared the outbreak of COVID-19 to be a pandemic. The COVID-19 pandemic is having widespread, rapidly evolving, and unpredictable impacts
on global society, economies, financial markets, and business practices. During 2021, there was a wide distribution of several vaccinations
and medicines to overcome the pandemic. We have shifted our operations to co-exist along with the pandemic, including encouragement of
vaccinations to all of our employees worldwide.



The uncertainty to which the COVID-19 pandemic
impacts the Company’s business, affects management’s judgment and assumptions relating to accounting estimates in a variety
of areas that depend on these estimates and assumptions. COVID-19 did not have a material influence on these estimates and judgements
since the Company began operations in 2021.



The Company continues to face relative uncertainty
as to the remaining intensity and duration of and the nature and timeline for recovery from the COVID-19 pandemic going forward and how
all of that impacts the Company, including the extent to which potentially permanent changes clinical trial operations have been caused
by the pandemic. The Company has taken the approach of managing the pandemic (to the extent that it continues to remain a significant
factor) via strengthening its balance sheet and cash assets and avoiding debt while focusing on cost controls. Some factors from the
COVID-19 outbreak or any outbreak caused by any variant of COVID-19 that may delay or otherwise adversely affect our clinical trial programs,
as well as adversely impact our business generally, include:



| | ➢ | delays
                                            or difficulties in clinical site initiation, including difficulties in recruiting clinical
                                            sites, and delays enrolling patients in our clinical trials or increased rates of patients
                                            withdrawing from our clinical trials following enrollment as a result of contracting COVID-19,
                                            being forced to quarantine, or not otherwise being able to complete study assessments, particularly
                                            for older patients or others with a higher risk of contracting COVID-19;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





19







| | ➢ | diversion
                                            of healthcare resources, including clinical trial investigators and staff, away from the
                                            conduct of clinical trials to focus on pandemic concerns which could result in delays to
                                            our partner companies’ clinical trials;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | limitations
                                            on travel, including limitations on domestic and international travel, and government-imposed
                                            quarantines or restrictions imposed by key third parties that could interrupt key trial activities,
                                            such as clinical trial site initiations and monitoring;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | interruption
                                            of, or delays in receiving, supplies of our product candidates from our contract manufacturing
                                            organizations due to staffing shortages, or production slowdowns or stoppages;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | disruptions
                                            and delays caused by potential workplace, laboratory and office closures and an increased
                                            reliance on employees working from home across the healthcare system; and
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | disruptions
                                            in or delays to regulatory approvals, inspections, reviews or other regulatory activities
                                            as a result of the spread of COVID-19 affecting the operations of the FDA or other regulatory
                                            authorities.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



We currently rely on third parties for certain
functions or services in support of our clinical trials and key areas of our operations. If these third parties themselves are adversely
impacted by restrictions resulting from the COVID-19 outbreak, we will likely experience delays and/or realize additional costs. As a
result, our ability to commence and complete clinical trials in timely fashion, obtain regulatory approvals for, and to commercialize,
our current and future product candidates may be delayed or disrupted.



Risks
Related to the Development of our ProductCandidates



Our discovery and preclinical development
approach focuses on the development of precision medicines for patients with genetically defined cancers and may never lead to marketable
products.



The patient populations for our product candidates
and potential future product candidates are limited to those with specific target mutations and may not be completely defined but are
substantially smaller than the general treated cancer population and we will need to screen and identify these patients with the targeted
mutations. Successful identification of patients is dependent on several factors, including achieving certainty as to how specific genetic
alterations respond to our current product candidates or any future product candidate and, if necessary, developing companion diagnostics
to identify such genetic alterations. Furthermore, even if we are successful in identifying patients, we cannot be certain that the resulting
patient populations for each mutation will be large enough to allow us to successfully obtain approval for each mutation type and commercialize
our products and achieve profitability. In addition, even if our approach is successful in showing clinical benefit by downregulating
the HSF1 pathway in tumors harboring an ARID1a mutation or alteration, we may never successfully identify additional oncogenic mutations
for other genes. We do not know if our approach of treating patients with genetically defined cancers will be successful; and if our
approach is unsuccessful, our business will suffer.



We are very early in our development efforts
and are substantially dependent on our lead product candidate, NXP800. If we are unable to advance NXP800, NXP900 or any of our other
future product candidates through preclinical and clinical development, obtain regulatory approval and ultimately commercialize NXP800,
NXP900 or any of our other future product candidates, or experience significant delays in doing so, our business will be materially harmed.



NXP800, our lead product candidate, is only now
starting to be tested in human subjects. Our ability to generate product revenues will depend heavily on the successful clinical development
and eventual commercialization of NXP800 or future product candidates. Our second drug candidate, NXP900, has begun IND-enabling studies
or similar studies required by a foreign regulatory agency. Depending on the results of these IND-enabling studies, we may not be able
to submit an IND application with the FDA or a similar submission with a foreign regulatory agency and, therefore, may not be able to
conduct clinical trials for NXP900. In addition, our drug development programs may contemplate the development of companion diagnostics,
which are assays or tests to identify an appropriate patient population. Companion diagnostics are subject to regulation as medical devices
and must themselves receive marketing authorization from the FDA or certain other foreign regulatory agencies before they may be marketed.
If a companion diagnostic is essential to the safe and effective use of any of our current and future product candidates, the FDA must
conclude that the companion diagnostic meets the applicable standard for safety and effectiveness or for substantial equivalence for
use with our product candidates before either the product candidates or companion diagnostic may be marketed in the United States.





20







Negative results in the development of our lead
product candidate may also prevent or delay our ability to continue or conduct clinical programs or receive regulatory approvals for
our other future product candidates. For example, although we believe, based on preclinical studies of OCCC models that demonstrated
tumor growth inhibition, that this cancer type might be particularly sensitive to NXP800, this may not prove true in clinical testing
for any or all of the target indications. Moreover, anti-tumor activity may be different in each tumor type that we plan to evaluate
in clinical trials. Therefore, even though we plan to potentially pursue tumor-agnostic clinical development of NXP800, the tumor response
may be low in patients with some cancers compared to others. As a result, we may be required to discontinue development of NXP800 for
patients with those tumor types and/or mutations due to insufficient clinical benefit, while continuing development in a more limited
population of patients. Consequently, in order to obtain regulatory approval, we may have to reach agreement with the FDA on defining
the optimal patient population, study design and size, any of which may require significant additional resources and delay our clinical
trials and ultimately the approval, if any, of any of our other future product candidates.



We may experience setbacks that could delay or
prevent regulatory approval of, or our ability to commercialize, our current or future product candidates, including:



| | ➢ | negative
                                            or inconclusive results from our preclinical studies or clinical trials or positive results
                                            from the clinical trials of others for product candidates similar to ours leading to their
                                            approval, and evolving to a decision or requirement to conduct additional preclinical testing
                                            or clinical trials or abandon a program;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | product-related
                                            side effects experienced by patients or subjects in our clinical trials or by individuals
                                            using drugs or therapeutics that we, the FDA, other regulators or others view as relevant
                                            to the development of our current or future product candidates;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | delays
                                            in submitting IND applications or comparable foreign applications or delays or failure in
                                            obtaining the necessary approvals from regulators to commence a clinical trial, or a suspension
                                            or termination of a clinical trial once commenced;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | conditions
                                            imposed by the FDA or comparable foreign authorities regarding the scope or design of our
                                            clinical trials, including our clinical endpoints;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | delays
                                            in enrolling subjects in clinical trials, including due to the COVID-19 pandemic, and completion
                                            of clinical trials, including under GCP or good laboratory practice (“GLP”) requirements;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | inability
                                            to maintain compliance with regulatory requirements, including cGMPs, and complying effectively
                                            with other requirements pertaining to the quality of our current or future product candidates;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | high
                                            drop-out rates of subjects from clinical trials;
| | - | -------------------------------------------------------------------------------------------------



| | ➢ | inadequate
                                            supply or quality of our current or future product candidates or other materials necessary
                                            for the conduct of our clinical trials;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | greater
                                            than anticipated clinical trial costs;
| | - | ------------------------------------------------------------------------------------------



| | ➢ | inability
                                            to compete with other therapies;
| | - | --------------------------------------------------------------------------------------



| | ➢ | poor
                                            efficacy of our current or future product candidates during clinical trials;
| | - | -----------------------------------------------------------------------------------------------------------------------------





21







| | ➢ | trial
                                            results taking longer than anticipated;
| | - | -----------------------------------------------------------------------------------------



| | ➢ | trials
                                            being subjected to fraud or data capture failure or other technical mishaps leading to the
                                            invalidation of our trials;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            results of our trials not supporting application for conditional approval in the European
                                            Union;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | unfavorable
                                            FDA or other regulatory agency inspection and review of a clinical trial site;
| | - | --------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | failure
                                            of our third-party contractors or investigators to comply with regulatory requirements or
                                            otherwise meet their contractual obligations in a timely manner, or at all;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | delays
                                            related to the impact of the spread of the COVID-19 pandemic, including the impact of COVID-19
                                            on the FDA’s ability to continue its normal operations;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | delays
                                            and changes in regulatory requirements, policy and guidelines, including the imposition of
                                            additional regulatory oversight around clinical development generally or with respect to
                                            our technology in particular; or
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | varying
                                            interpretations of data by the FDA and similar foreign regulatory agencies.
| | - | -------------------------------------------------------------------------------------------------------------------------------



In addition, because we have limited financial
and personnel resources and are focusing primarily on developing our lead product candidate, we may forgo or delay pursuit of other future
product candidates that may prove to have greater commercial potential and may fail to capitalize on viable commercial products or profitable
market opportunities. If we do not accurately evaluate the commercial potential or target market for a future product candidate, we may
relinquish valuable rights to those future product candidates through collaboration, licensing, or other royalty arrangements in cases
in which it would have been more advantageous for us to retain sole development and commercialization rights to such future product candidates.



Clinical drug development involves a lengthy
and expensive process with uncertain outcomes, clinical trials are difficult to design and implement, and any of our clinical trials
could produce unsuccessful results or fail at any stage in the process.



Clinical trials conducted on humans are expensive
and can take many years to complete, and outcomes are inherently uncertain. Failure can occur at any time during the process. Additionally,
any positive results of preclinical studies and early clinical trials of a drug candidate may not be predictive of the results of later-stage
clinical trials, such that drug candidates may reach later stages of clinical trials and fail to show the desired safety and efficacy
traits despite having shown indications of those traits in preclinical studies and early-stage clinical trials. A number of companies
in the pharmaceutical industry have suffered significant setbacks in advanced clinical trials due to lack of efficacy or adverse safety
profiles, notwithstanding promising results in preclinical studies or earlier phases of clinical trials. Therefore, the results of any
future clinical trials we conduct may not be successful.



Clinical trials may be delayed, suspended or
prematurely terminated because costs are greater than we anticipate or for a variety of reasons, such as:



| | ➢ | delay
                                            or failure in reaching agreement with the FDA or a comparable foreign regulatory authority
                                            on a trial design that we are able to execute;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | delay
                                            or failure in obtaining authorization to commence a trial, including approval from the appropriate
                                            independent review board (“IRB”) to conduct testing of a candidate on human subjects,
                                            or inability to comply with conditions imposed by a regulatory authority regarding the scope
                                            or design of a clinical trial;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | delay
                                            in reaching, or failure to reach, agreement on acceptable terms with prospective CROs and
                                            clinical trial sites, the terms of which can be subject to extensive negotiation and may
                                            vary significantly among different CROs and trial sites;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





22







| | ➢ | inability,
                                            delay or failure in identifying and maintaining a sufficient number of trial sites, many
                                            of which may already be engaged in other clinical programs;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | delay
                                            or failure in recruiting and enrolling suitable volunteers or patients to participate in
                                            a trial;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | delay
                                            or failure in developing and validating companion diagnostics, if they are deemed necessary,
                                            on a timely basis;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | failure
                                            of patients to complete a trial or return for post-treatment follow-up;
| | - | ---------------------------------------------------------------------------------------------------------------------------



| | ➢ | inability
                                            to monitor patients adequately during or after treatment;
| | - | ---------------------------------------------------------------------------------------------------------------



| | ➢ | clinical
                                            sites and investigators deviating from trial protocols, failing to conduct the trial in accordance
                                            with regulatory requirements or dropping out of a trial;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | failure
                                            to initiate or delay of or inability to complete a clinical trial as a result of a clinical
                                            hold imposed by the FDA or comparable foreign regulatory authority due to observed safety
                                            findings or other reasons;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | negative
                                            or inconclusive results in our clinical trials, and our decision to or regulators’
                                            requirement that we conduct additional preclinical studies, clinical trials or that we abandon
                                            one or more of our product development programs; or
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | inability
                                            to manufacture sufficient quantities of a drug candidate of acceptable quality for use in
                                            clinical trials.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



We rely and plan to continue to rely on CROs,
contract manufacturing organizations (“CMOs”) and clinical trial sites to ensure the proper and timely conduct of our clinical
trials. Although we have and expect that we will have agreements in place with CROs and CMOs governing their contracted activities and
conduct, we will have limited influence over their actual performance. As a result, we ultimately do not and will not have control over
a CRO’s or CMO’s compliance with the terms of any agreement it may have with us, its compliance with applicable regulatory
requirements, or its adherence to agreed-upon time schedules and deadlines, and a future CRO or CMO’s failure to perform those
obligations could subject any of our clinical trials to delays or failure.



Further, we may also encounter delays if a clinical
trial is suspended or terminated by us, by any IRB or ethics committee, by a Data Safety Monitoring Board, or by the FDA or European
Medicines Agency (“EMA”), or other regulatory authority. A suspension or termination may be due to a number of factors, including
failure to conduct the clinical trial in accordance with regulatory requirements, inspection of the clinical trial operations or trial
site by the FDA, EMA or other regulatory authorities, exposing participants to health risks caused by unforeseen safety issues or adverse
side effects, development of previously unseen safety issues, failure to demonstrate a benefit from using a drug candidate, or changes
in governmental regulations or administrative actions. Therefore, we cannot predict with any certainty the schedule for commencement
or completion of any currently ongoing, planned or future clinical trials.



Many of the factors that cause, or lead to, a
delay in the commencement or completion of clinical trials may also ultimately lead to the denial of marketing approval for our current
or future product candidates.



If we experience delays in the commencement or
completion of, or suspension or termination of, any clinical trial for our drug candidates, the commercial prospects of the drug candidate
could be harmed, and our ability to generate product revenues from the drug candidate may be delayed or eliminated. In addition, any
delays in completing our clinical trials will increase our costs, slow down our drug candidate development and approval process and jeopardize
regulatory approval of our drug candidates and our ability to commence sales and generate revenues. The occurrence of any of these events
could harm our business, financial condition, results of operations and prospects significantly.





23







Difficulty in enrolling patients could
delay or prevent clinical trials of our current or future product candidates.



Identifying and qualifying patients to participate
in clinical studies of our current or future product candidates is critical to our success. The timing of completion of our clinical
studies depends in part on the speed at which we can recruit patients to participate in testing our current or future product candidates
and we may experience delays in our clinical trials if we encounter difficulties in enrollment. Further, because we are focused on patients
with specific indications and genetic mutations, our ability to enroll eligible patients may be limited and may result in slower enrollment
than we anticipate. Our clinical trials will compete with other clinical trials for current or future product candidates that are in
the same therapeutic areas as our current or future product candidates, which may reduce the number and types of patients available to
us.



Clinical trials may be subject to delays as a
result of patient enrollment taking longer than anticipated or greater than anticipated subject withdrawal. We may not be able to initiate
or continue clinical trials for our current or future product candidates if we are unable to locate and enroll a sufficient number of
eligible patients to participate in these trials as required by the FDA or foreign regulatory authorities. We cannot predict how successful
we will be at enrolling subjects in future clinical trials. The enrollment of patients depends on many factors, including:



| | ➢ | patient
                                            eligibility and exclusion criteria defined in the protocol;
| | - | ---------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            size of the patient population required for analysis of the clinical trial’s primary
                                            endpoints and the process for identifying patients;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | potential
                                            disruptions caused by the COVID-19 pandemic, including difficulties in initiating clinical
                                            sites, enrolling and retaining participants, diversion of health care resources away from
                                            clinical trials, travel or quarantine policies that may be implemented, and other factors;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            proximity of patients to clinical trial sites;
| | - | ----------------------------------------------------------------------------------------------



| | ➢ | the
                                            design of the trial;
| | - | --------------------------------------------------------------------



| | ➢ | our
                                            ability to recruit clinical trial investigators with the appropriate competencies and expertise;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | clinicians’
                                            and patients’ perceptions as to the potential advantages and risks of the product candidate
                                            being studied in relation to other available therapies, including any new products that may
                                            be approved for the indications we are investigating;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            availability of competing commercially available therapies and other competing product candidates’
                                            clinical trials;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | our
                                            ability to obtain and maintain clinical trial subject informed consents; and
| | - | ----------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            risk that subjects enrolled in clinical trials will drop out of the trials before completion.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------



If we are unable to locate and enroll sufficient
eligible patients to participate, as required by the FDA or similar regulatory authorities, we may be unable to initiate or continue
clinical trials for our current or future product candidates. If necessary, we intend to engage third parties to develop companion diagnostics
for use in our clinical trials. If such third parties are unsuccessful, our difficulty in identifying patients with the targeted genetic
mutations for our clinical trials would be increased. If we are unable to include patients with the targeted genetic mutations or patients
with well-defined serious unmet medical needs, we may be unable to participate in the FDA’s expedited review and development programs,
including breakthrough therapy designation and fast track designation, or otherwise seek to accelerate clinical development and regulatory
timelines.



Our preclinical studies and clinical trials
may fail to demonstrate adequately the safety, potency, purity, efficacy or any other necessary pharmacological properties of any of
our current or future product candidates, which would prevent or delay development, regulatory approval and commercialization.



Before obtaining regulatory approvals for the
commercial sale of our current or future product candidates, including NXP800 and NXP900, we must demonstrate through lengthy, complex
and expensive preclinical studies and clinical trials that our current or future product candidates are both safe and effective for use
in each target indication. Preclinical and clinical testing is expensive and can take many years to complete, and its outcome is inherently
uncertain. Failure can occur at any time during the preclinical study and clinical trial processes, and, because our current product
candidates are in an early stage of development, there is a high risk of failure.





24







The results of preclinical studies and early
clinical trials of our current or future product candidates may not be predictive of the results of later-stage clinical trials. Although
product candidates may demonstrate promising results in preclinical studies and early clinical trials, they may not prove to be effective
in subsequent clinical trials. Additionally, while we initiated the first clinical trial for NXP800 in December 2021, clinical trials
for any of our current or future product candidates, as is the case with all oncology drugs, it is likely that there may be side effects
associated with their use. Results of our trials could reveal a high and unacceptable severity and prevalence of these or other side
effects. In such an event, our trials could be suspended or terminated, and the FDA or comparable foreign regulatory authorities could
order us to cease further development of or deny approval of our current or future product candidates for any or all targeted indications.
Drug-related side effects could also affect patient recruitment into the study or patient willingness to remain in the study and therefore
affect our ability to complete clinical trials. Drug-related side effects could also result in potential product liability claims. Any
of these occurrences may harm our business, financial condition and prospects significantly.



The FDA and comparable foreign regulatory
authorities may not accept data from any preclinical or clinical trials we may conduct in foreign countries.



The FDA’s acceptance of data generated
for patients recruited outside the United States from clinical trials conducted in whole or in part outside the United States may be
subject to certain conditions, if accepted at all.



Although the FDA has the authority to accept
foreign data as part or even the sole basis for marketing approval, the FDA generally does not approve an application on the basis of
foreign data alone unless (i) the data is applicable to the U.S. population and U.S. medical practice, (ii) the trials were
performed by clinical investigators of recognized competence and pursuant to GCP regulations, and (iii) the FDA’s clinical
trial requirements were met. Many foreign regulatory authorities have similar approval requirements. In addition, any clinical study
conducted in whole or in part outside of the United States would be subject to the applicable local laws of the jurisdiction where the
trial was conducted. We cannot guarantee that the FDA or comparable foreign regulatory authority will accept data from trials conducted
in whole or in part outside of the United States, which may result in the need for additional trials.



We may not be able to submit IND applications
to commence additional clinical trials on the timelines we expect, and even if we are able to, the FDA may not permit us to proceed.



Our CTA for NXP800 with the MHRA was approved
and an IND submission for NXP800 to the FDA is expected in the second quarter of 2022. However, if we experience manufacturing delays
or any other delays, we may be unable to file additional CTAs, IND applications or other clinical research authorizations for other
product candidates on our expected timelines. Moreover, while we have obtained MHRA approval of the CTA, we cannot be sure that submission
of an IND application will result in the FDA allowing our planned clinical trials to begin, or that, once begun, issues will not arise
that suspend or terminate such clinical trials. Any failure to file CTAs, IND applications or other clinical research authorizations
will adversely impact our expected timelines to obtain regulatory acceptance for the commencement of our trials and may prevent us from
completing our clinical trials or commercializing our products on a timely basis, if at all.



We currently have no marketing and sales
organization and have limited experience in marketing products. If we are unable to establish marketing and sales capabilities or enter
into agreements with third parties to market and sell any approved product candidates, we may not be able to generate product revenue.



We will have to compete with other pharmaceutical
and biotechnology companies to recruit, hire, train and retain marketing and sales personnel. If we are unable or decide not to establish
internal sales, marketing, and distribution capabilities, we may pursue arrangements with third-party sales, marketing, and distribution
collaborators regarding the sales and marketing of our products, if approved.





25







There can be no assurance that we will be able
to develop in-house sales and distribution capabilities or establish or maintain relationships with third-party collaborators to commercialize
any product in the United States or overseas.



We face substantial competition, which
may result in others discovering, developing or commercializing products before or more successfully than we do.



While we believe that our scientific knowledge,
technology, and development expertise provide us with competitive advantages, we face potential competition from many different sources,
including major pharmaceuticals, specialty pharmaceuticals and biotechnology companies, academic institutions and government agencies,
and public and private research institutes that conduct research, development, manufacturing, and commercialization. Many of our competitors
have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, regulatory
approvals, and product marketing than we do. Our competitors may compete with us in recruiting and retaining qualified scientific and
management personnel and establishing clinical trial sites and patient recruitment for clinical trials, as well as in acquiring technologies
complementary to, or necessary for, our programs. As a result, our competitors may discover, develop, license, or commercialize products
earlier or more successfully than we do.



If our product candidates, NXP800 and NXP900,
are approved for the indications for which we are currently conducting or planning preclinical and clinical trials, they will likely
compete with competitor drugs and other drugs that are currently in development. The availability of reimbursement from government and
other third-party payors will also significantly affect the pricing and competitiveness of our products. Our competitors may also obtain
FDA or other regulatory approval for their products more rapidly than we do, which could result in our competitors establishing a strong
market position before we are able to enter the market.



Risks Related to Government Regulation



Denial
of or delay in our receipt of required regulatory approvals may prevent or delay commercialization of our current or future product candidates
and our ability to generate revenue may be materially impaired.



The research, testing, manufacturing, labeling,
approval, sale, marketing and distribution of drug products are, and will remain, subject to extensive regulation by the FDA in the United
States and by the respective regulatory authorities in other countries where regulations differ. We will not be permitted to market our
current or future product candidates in the United States until we receive the respective approval of an NDA from the FDA, or in any
foreign countries until we receive the requisite approval from the respective regulatory authorities in such countries. The time required
to obtain regulatory approval, if any, by the FDA, EMA and comparable foreign authorities is unpredictable, but typically takes many
years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory
authorities and the type, complexity and novelty of the product candidates involved. Regulatory authorities have substantial discretion
in the approval process and may refuse to accept any application or may decide that our data are insufficient for approval and require
additional nonclinical studies or clinical trials.



Obtaining regulatory approval requires the submission
of extensive nonclinical and clinical data and supporting information to regulatory authorities for each therapeutic indication to establish
the product candidate’s safety and efficacy. Securing regulatory approval also requires the submission of information about the
product manufacturing process, and in many cases the inspection of manufacturing, processing, and packaging facilities by the regulatory
authorities. Our current or future product candidates may not be effective, may be only moderately effective or may prove to have undesirable
or unintended side effects, toxicities or other characteristics that may preclude our obtaining marketing approval or prevent or limit
commercial use, or there may be deficiencies in cGMP compliance by us or by our CMOs that could result in the candidate not being approved.
Moreover, we have not obtained regulatory approval for any drug candidate in any jurisdiction and it is possible that none of our existing
drug candidates or any drug candidates we may seek to develop in the future will ever obtain regulatory approval.





26







Our drug candidates could fail to receive, or
could be delayed in receiving, regulatory approval for many reasons, including any one or more of the following:



| | ➢ | the
                                            FDA, EMA or comparable foreign regulatory authorities may disagree with the design or implementation
                                            of our clinical trials;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | we
                                            may be unable to demonstrate to the satisfaction of the FDA, EMA or comparable foreign regulatory
                                            authorities that a drug candidate is safe and effective for its proposed indication;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            results of clinical trials may not meet the level of statistical significance required by
                                            the FDA, EMA or comparable foreign regulatory authorities for approval;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | we
                                            may be unable to demonstrate that a drug candidate’s clinical and other benefits outweigh
                                            its safety risks;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            FDA, EMA or comparable foreign regulatory authorities may disagree with our interpretation
                                            of data from preclinical studies or clinical trials;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            data collected from clinical trials of our drug candidates may not be sufficient to support
                                            the submission of an NDA or other submission or to obtain regulatory approval in the United
                                            States or elsewhere;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | upon
                                            review of our clinical trial sites and data, the FDA or comparable foreign regulatory authorities
                                            may find our record keeping or the record keeping of our clinical trial sites to be inadequate;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            manufacturing processes or facilities of third-party manufacturers with which we contract
                                            for clinical and commercial supplies may fail to meet the requirements of the FDA, EMA or
                                            comparable foreign regulatory authorities;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            FDA, EMA or comparable foreign regulatory authorities may fail to approve the companion diagnostics
                                            we contemplate developing internally or with partners; and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            change of the medical standard of care or the approval policies or regulations of the FDA,
                                            EMA or comparable foreign regulatory authorities may significantly change in a manner that
                                            renders our clinical data insufficient for approval.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The time and expense of the approval process,
as well as the unpredictability of future clinical trial results and other contributing factors, may result in our failure to obtain
regulatory approval to market NXP800, NXP900 or any other drug candidates we may seek to develop in the future, which would significantly
harm our business, results of operations and prospects. In such case, we may also not have the resources to conduct new clinical trials
and/or we may determine that further clinical development of any such drug candidate is not justified and may discontinue any such programs.



In addition, even if we were to obtain regulatory
approval in one or more jurisdictions, regulatory authorities may approve any of our drug candidates for fewer or more limited indications
than we request, may not approve prices we may propose to charge for our products, may grant approval contingent on the performance of
costly post-marketing clinical trials (referred to as “conditional” or “accelerated” approval depending on the
jurisdiction), or may approve a drug candidate with a label that does not include the labeling claims necessary or desirable for the
successful commercialization of that drug candidate. Any of the foregoing circumstances could materially harm the commercial prospects
for our drug candidates.



Obtaining and maintaining regulatory approval
of our current or future product candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval
of our current or future product candidates in other jurisdictions.



Obtaining and maintaining regulatory approval
of any of our current or future product candidates in one jurisdiction does not guarantee that we will be able to obtain or maintain
regulatory approval in any other jurisdiction, while a failure or delay in obtaining regulatory approval in one jurisdiction may have
a negative effect on the regulatory approval process in other jurisdictions. For example, even if the FDA grants regulatory approval
of a product candidate, similar foreign regulatory authorities must also approve the manufacturing, marketing and promotion of the product
candidate in those countries. Drug product approval procedures vary among jurisdictions and can involve requirements and administrative
review periods different from, and greater than, those in the United States, including additional preclinical studies or clinical trials
as clinical trials conducted in one jurisdiction may not be accepted by regulatory authorities in other jurisdictions. In many jurisdictions
outside the United States, a product candidate must be approved for reimbursement before it can be approved for sale in that jurisdiction.
In some cases, the price that we intend to charge for our products is also subject to approval.





27







We may also submit marketing applications in
other countries. Regulatory authorities in jurisdictions outside of the United States have requirements for approval of product candidates
with which we must comply prior to marketing in those jurisdictions. Obtaining similar foreign regulatory approvals and compliance with
similar foreign regulatory requirements could result in significant delays, difficulties and costs for us and could delay or prevent
the introduction of our products in certain countries. We do not have any product candidates approved for sale in any jurisdiction, including
international markets, and we do not have experience in obtaining regulatory approval in international markets. If we fail to comply
with the regulatory requirements in international markets and/or receive applicable marketing approvals, our target market will be reduced
and our ability to realize the full market potential of our current or future product candidates will be harmed.



Even if we receive regulatory approval
of our current or future product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which
may result in significant additional expense and we may be subject to penalties if we fail to comply with regulatory requirements or
experience unanticipated problems with our current or future product candidates.



If any of our current or future product candidates
are approved, activities such as the manufacturing, labeling, packaging, storage, advertising, promotion, sampling, and record keeping
for the products will be subject to extensive and ongoing regulatory requirements. These requirements include submissions of safety and
other post-marketing information and reports, registration, as well as ongoing compliance with cGMP regulations. Drug manufacturers and
any CMOs responsible for any product manufacturing processes are required to comply with extensive FDA and comparable foreign regulatory
authority requirements, including ensuring that quality control and manufacturing procedures conform to cGMP regulations and any applicable
foreign equivalents. As such, we and our CMOs will be subject to continual review and inspections to assess compliance with cGMP and
adherence to commitments made in any NDA, other marketing application, and previous responses to inspection observations. Accordingly,
we and others with whom we work must continue to expend time, money, and effort in all areas of regulatory compliance, including manufacturing,
production and quality control.



The FDA or a comparable foreign regulatory authority
may also impose requirements for costly post-marketing nonclinical studies or clinical trials (often called “Phase 4 trials”)
and post-marketing surveillance to monitor the safety or efficacy of the product. If we or a regulatory authority discover previously
unknown problems with a product, such as adverse events of unanticipated severity or frequency, production problems or issues with the
facility where the product is manufactured or processed, such as product contamination or significant not-compliance with applicable
cGMP regulations, a regulator may impose restrictions on that product, the manufacturing facility or us. If we or our third-party providers,
including our CMOs, fail to comply fully with applicable regulations, then we may be required to initiate a recall or withdrawal of our
products.



Later discovery of previously unknown problems
with our current or future product candidates, including adverse events of unanticipated severity or frequency, or with our third-party
manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may result in the following, among other
things:



| | ➢ | restrictions
                                            on the manufacturing of the product, the approved manufacturers or the manufacturing process;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | restrictions
                                            on the labeling or marketing of a product;
| | - | ---------------------------------------------------------------------------------------------------



| | ➢ | restrictions
                                            on product distribution or use;
| | - | ----------------------------------------------------------------------------------------



| | ➢ | requirements
                                            to conduct post-marketing studies or clinical trials;
| | - | --------------------------------------------------------------------------------------------------------------



| | ➢ | withdrawal
                                            of the product from the market;
| | - | --------------------------------------------------------------------------------------





28







| | ➢ | product
                                            recalls;
| | - | ------------------------------------------------------------



| | ➢ | warning
                                            or untitled letters from the FDA or comparable notice of violations from foreign regulatory
                                            authorities;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | refusal
                                            of the FDA or other applicable regulatory authority to approve pending applications or supplements
                                            to approved applications;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | fines,
                                            restitution or disgorgement of profits or revenues;
| | - | ------------------------------------------------------------------------------------------------------



| | ➢ | suspension
                                            or withdrawal of marketing approvals;
| | - | --------------------------------------------------------------------------------------------



| | ➢ | suspension
                                            of any of our ongoing clinical trials;
| | - | ---------------------------------------------------------------------------------------------



| | ➢ | product
                                            seizure or detention or refusal to permit the import or export of products; and
| | - | -----------------------------------------------------------------------------------------------------------------------------------



| | ➢ | consent
                                            decrees, injunctions or the imposition of civil or criminal penalties.
| | - | --------------------------------------------------------------------------------------------------------------------------



In addition, regulatory authorities’ policies
(such as those of the FDA or EMA) may change and additional government regulations may be enacted that could prevent, limit or delay
regulatory approval of our current or future product candidates. If we are slow or unable to adapt to changes in existing requirements
or the adoption of new requirements or policies, or if we are otherwise not able to maintain regulatory compliance, we may lose any marketing
approval that we may have obtained, which would adversely affect our business, prospects and ability to achieve or sustain profitability.



Non-compliance with European Union requirements
regarding safety monitoring or pharmacovigilance can also result in significant financial penalties. Similarly, failure to comply with
the European Union’s requirements regarding the protection of personal information can also lead to significant penalties and sanctions.



The FDA’s policies may change and additional
government regulations may be enacted that could prevent, limit or delay marketing approval of our current or future product candidates.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not
able to maintain regulatory compliance, this may adversely affect, or even lead to the rescission of, the marketing approval that we
may have obtained, which would adversely affect our business, prospects and ability to achieve or sustain profitability.



A variety of risks associated with marketing
our current or future product candidates internationally could materially adversely affect our business.



We plan to seek regulatory approval of our current
or future product candidates outside of the United States and expect that we will be subject to additional risks related to operating
in foreign countries including: differing regulatory requirements; unexpected changes in tariffs, trade barriers, price and exchange
controls; economic weakness, including inflation, or political instability in particular foreign economies and markets; compliance with
tax, employment, immigration and labor laws for employees living or traveling abroad; foreign currency fluctuations that result in increased
operating expenses, reduced revenue, and other obligations incident to doing business in another country; potential liability under the
Foreign Corrupt Practices Act of 1977 or comparable foreign regulations; and challenges enforcing our contractual and intellectual property
rights, especially in countries that do not recognize intellectual property rights to the same extent as the United States.



The insurance coverage and reimbursement
status of newly approved products is uncertain. Our current or future product candidates may become subject to unfavorable pricing regulations,
third-party coverage and reimbursement practices, or healthcare reform initiatives, which would harm our business. Failure to obtain
or maintain adequate coverage and reimbursement for new or current products could limit our ability to market those products and decrease
our ability to generate revenue.



Adverse pricing limitations may hinder our ability
to recoup our investment in one or more of our current or future product candidates, even if any such current or future product candidate
we may develop obtains marketing approval.





29







Our ability to successfully commercialize any
current or future product candidates will depend in part on the coverage and reimbursement for the products and related treatments from
government health administration authorities and third-party payors, such as private health insurers and health maintenance organizations.
These organizations decide which medications they will pay for and establish reimbursement levels. If coverage and adequate reimbursement
is not available, or the approved reimbursement amount is not high enough, we may be unable to establish or maintain pricing sufficient
to generate a return on our investment and may be unable to successfully commercialize our current or future product candidates. Reimbursement
by a third-party payor may depend upon a number of factors, including, but not limited to, the third-party payor’s determination
that use of a product is a covered benefit under its health plan, safe, effective and medically necessary, appropriate for the specific
patient, cost-effective, and neither experimental nor investigational. If coverage and adequate reimbursement is not available, or the
approved reimbursement amount is not high enough, we may be unable to establish or maintain pricing sufficient to generate a return on
our investment and may be unable to successfully commercialize our current or future product candidates.



A primary trend in the U.S. healthcare industry
and elsewhere is cost containment. Government authorities and third-party payors have attempted to control costs by limiting coverage
and the amount of reimbursement for particular medications. In general, the prices of medicines under such systems are substantially
lower than in the United States.



There is also significant uncertainty related
to the insurance coverage and reimbursement of newly approved products, and coverage may be more limited than the purposes for which
the medicine is approved by the FDA or comparable foreign regulatory authorities. In the United States, the principal decisions about
reimbursement for new medicines are typically made by CMS. As a result, the coverage determination process is often a time consuming
and costly process that may require us to provide scientific and clinical support for the use of our products to each payor separately,
with no assurance that coverage and adequate reimbursement will be applied consistently or obtained in the first instance. It is difficult
to predict what CMS will decide with respect to reimbursement for fundamentally novel products such as ours. Reimbursement agencies in
Europe may be more conservative than CMS. Our inability to promptly obtain coverage and profitable payment rates from both government-funded
and private payors for any approved products we may develop could have a material adverse effect on our operating results, our ability
to raise capital needed to commercialize our current or future product candidates, and our overall financial condition.



Healthcare legislative measures and changes
in policies, funding, staffing and leadership at the FDA and other agencies could hinder or prevent the commercial success of our products.



In the United States, there have been a number
of legislative and regulatory changes to the healthcare system that could affect our future results of operations and the future results
of operations of our potential customers.



In recent years, there has been heightened governmental
scrutiny over the manner in which biopharmaceutical manufacturers set prices for their marketed products, which has resulted in several
recent government inquiries as well as federal and state legislation designed to, among other things, increase drug price transparency,
review the relationship between pricing and manufacturer patient programs, reduce the cost of drugs under Medicare, and reform government
reimbursement for drug products. Congress and the executive branch have each indicated that they will continue to seek new legislative
and/or administrative measures to control drug costs, making this area subject to ongoing uncertainty. At the state level in the United
States, legislatures have also increasingly passed legislation and implemented regulations designed to control drug product pricing.



While we cannot predict what impact these laws
or policies will have in general or specifically on any product we may commercialize in the future, such efforts by the government and
payors may result in downward pressure on reimbursement, which could negatively affect market acceptance of new products. Any rebates,
discounts, taxes costs or regulatory or systematic changes on healthcare may have a significant effect on our profitability in the future.





30







Given recent federal and state government initiatives
directed at lowering the total cost of healthcare, the executive branch, Congress and state legislatures will likely continue to focus
on healthcare reform and the reform of the Medicare and Medicaid programs. While we cannot predict the full outcome of any such government
action or legislation, it may harm our ability to market our products and generate revenues.



Furthermore, regulatory authorities’ assessment
of the data and results required to demonstrate safety and effectiveness can change over time and can be affected by many factors, such
as the emergence of new information, including on other products, changing policies and agency funding, staffing and leadership. We cannot
be sure whether future changes to the regulatory environment will be favorable or unfavorable to our business prospects.



Our future relationships with customers
and third-party payors in the United States and elsewhere may be subject to applicable anti-kickback, fraud and abuse, false claims,
transparency, health information privacy and security and other healthcare laws and regulations, which could expose us to criminal sanctions,
civil penalties, contractual damages, reputational harm, administrative burdens, diminished profits and future earnings.



Healthcare providers, physicians and third-party
payors in the U.S. and elsewhere will play a primary role in the recommendation and prescription of any current or future product candidates
for which we obtain marketing approval. Our future arrangements with third-party payors and customers may expose us to broadly applicable
fraud and abuse and other healthcare laws and regulations, including, without limitation, the federal Anti-Kickback Statute and the federal
False Claims Act, which may constrain the business or financial arrangements and relationships through which we sell, market and distribute
any current or future product candidates for which we obtain marketing approval. In addition, we may be subject to transparency laws
and patient privacy regulation by the federal and state governments and by governments in foreign jurisdictions in which we conduct our
business. The applicable federal, state and foreign healthcare laws and regulations that may affect our ability to operate include, but
are not necessarily limited to:



| | ➢ | the
                                            federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly
                                            and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly,
                                            in cash or in kind, to induce or reward, or in return for, either the referral of an individual
                                            for, or the purchase, order or recommendation of, any good or service, for which payment
                                            may be made under federal and state healthcare programs, such as Medicare and Medicaid;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | federal
                                            civil and criminal false claims laws and civil monetary penalty laws, including the federal
                                            False Claims Act, which impose criminal and civil penalties, including civil whistleblower
                                            or qui tam actions, against individuals or entities for knowingly presenting, or causing
                                            to be presented, to the federal government, including the Medicare and Medicaid programs,
                                            claims for payment that are false or fraudulent or making a false statement to avoid, decrease
                                            or conceal an obligation to pay money to the federal government; the federal Health Insurance
                                            Portability and Accountability Act of 1996 (“HIPAA”), which imposes criminal
                                            and civil liability for executing a scheme to defraud any healthcare benefit program or making
                                            false statements relating to healthcare matters;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | HIPAA,
                                            as amended by the Health Information Technology for Economic and Clinical Health Act of 2009,
                                            and their respective implementing regulations, which impose obligations on covered healthcare
                                            providers, health plans, and healthcare clearinghouses, as well as their business associates
                                            that create, receive, maintain or transmit individually identifiable health information for
                                            or on behalf of a covered entity, with respect to safeguarding the privacy, security and
                                            transmission of individually identifiable health information;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            federal Open Payments program, which requires manufacturers of certain drugs, devices, biologics
                                            and medical supplies for which payment is available under Medicare, Medicaid or the Children’s
                                            Health Insurance Program, with specific exceptions, to report annually to CMS, information
                                            related to “payments or other transfers of value” made to “covered recipients,”
                                            which include physicians (defined to include doctors, dentists, optometrists, podiatrists
                                            and chiropractors, and teaching hospitals) and applicable manufacturers. Applicable group
                                            purchasing organizations also are required to report annually to CMS the ownership and investment
                                            interests held by the physicians and their immediate family members. The SUPPORT for Patients
                                            and Communities Act added to the definition of covered recipient practitioners including
                                            physician assistants, nurse practitioners, clinical nurse specialists, certified registered
                                            nurse anesthetists and certified nurse-midwives effective in 2022. Data collection began
                                            on August 1, 2013 with requirements for manufacturers to submit reports to CMS by March 31,
                                            2014 and 90 days after the end of each subsequent calendar year. Disclosure of such information
                                            was made by CMS on a publicly available website beginning in September 2014; and
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





31







| | ➢ | analogous
                                            state and foreign laws and regulations, such as state anti-kickback and false claims laws,
                                            which may apply to sales or marketing arrangements and claims involving healthcare items
                                            or services reimbursed by non-governmental third-party payors, including private insurers;
                                            state and foreign laws that require pharmaceutical companies to comply with the pharmaceutical
                                            industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated
                                            by the federal government or otherwise restrict payments that may be made to healthcare providers;
                                            state and foreign laws that require drug manufacturers to report information related to payments
                                            and other transfers of value to physicians and other healthcare providers or marketing expenditures;
                                            and state and foreign laws governing the privacy and security of health information in certain
                                            circumstances, many of which differ from each other in significant ways and often are not
                                            preempted by HIPAA, thus complicating compliance efforts.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In November 2020, HHS finalized significant
changes to the regulations implementing the Anti-Kickback Statute, as well as the Physician Self-Referral Law and the civil monetary
penalty rules regarding beneficiary inducements, with the goal of offering the healthcare industry more flexibility and reducing
the regulatory burden associated with those fraud and abuse laws, particularly with respect to value-based arrangements among industry
participants.



Efforts to ensure that our business arrangements
with third parties will comply with applicable healthcare laws and regulations may involve substantial costs. It is possible that governmental
authorities will conclude that our business practices may not comply with current or future statutes, regulations or case law involving
applicable fraud and abuse or other healthcare laws and regulations. If our operations are found to be in violation of any of these laws
or any other governmental regulations that may apply to us, we may be subject to significant civil, criminal and administrative penalties,
including, without limitation, damages, fines, imprisonment, exclusion from participation in government healthcare programs, such as
Medicare and Medicaid, and the curtailment or restructuring of our operations, which could have a material adverse effect on our businesses.
If any of the physicians or other healthcare providers or entities with whom we expect to do business, including our collaborators, is
found not to be in compliance with applicable laws, it may be subject to criminal, civil or administrative sanctions, including exclusions
from participation in government healthcare programs, which could also materially affect our businesses.



If we fail to comply with environmental,
health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could have a material adverse
effect on the success of our business.



We are subject to numerous environmental, health
and safety laws and regulations, including those governing laboratory procedures and the handling, use, storage, treatment and disposal
of hazardous materials and wastes. Our operations may involve the use of hazardous and flammable materials, including chemicals and biological
and radioactive materials. Our operations also may produce hazardous waste products. We currently contract with third parties for the
conduct of our manufacturing efforts and preclinical studies and clinical trials and such third parties are responsible for disposal
of these materials and wastes. However, we cannot eliminate our risk of contamination or injury from these materials. In the event of
contamination or injury resulting from our use of hazardous materials, we could be held liable for any resulting damages, and any liability
could exceed our resources. We also could incur significant costs associated with civil or criminal fines and penalties.



Although we maintain workers’ compensation
insurance to cover us for costs and expenses we may incur due to injuries to our employees resulting from the use of hazardous materials,
this insurance may not provide adequate coverage against potential liabilities. We do not maintain insurance for environmental liability
or toxic tort claims that may be asserted against us in connection with our storage or disposal of biological, hazardous or radioactive
materials.





32







Risks Related to our Intellectual Property



We currently hold a license to certain
intellectual property rights relating to our lead product candidate, NXP800 and to NXP900, as well as intellectual property rights relating
to other compounds that modulate HSF1 and the SRC and YES1 kinases. If we are unable to maintain patent and other intellectual property
protection for NXP800 and NXP900, and to obtain and maintain patent and other intellectual property protections for our other current
or future product candidates and technology, or if the scope of intellectual property protection obtained or maintained is not sufficiently
broad, our competitors could develop and commercialize products and technology similar or identical to ours, and our ability to commercialize
NXP800, NXP900 or any other current or future product candidates or technology may be adversely affected.



Our success depends in large part on our ability
to obtain and maintain patent and other intellectual property protection in the United States and other countries with respect to our
current or future product candidates, including NXP800 and NXP900, their respective components, formulations, combination therapies,
methods used to manufacture them and methods of treatment and development that are important to our business, as well as successfully
defending these patents against third-party challenges. If we do not adequately protect our intellectual property rights, or if the intellectual
property rights we are able to obtain are insufficiently broad and exclusive, competitors may be able to erode or negate any competitive
advantage we may have, which could harm our business and ability to achieve profitability.



We intend to rely upon a combination of patents,
patent applications, confidentiality agreements, trade secret protection and license agreements to protect the intellectual property
related to our current or future product candidates and technologies. Any disclosure to or misappropriation by third parties of our confidential
proprietary information could enable competitors to quickly duplicate or surpass our technological achievements, thus eroding our competitive
position in our market. We, or any current or future partners, collaborators, or licensees, may fail to identify patentable aspects of
inventions made in the course of development and commercialization activities before it is too late to obtain patent protection on them.
We may be also unable to exclusively license relevant technology and associated intellectual property developed by others. Therefore,
we may miss potential opportunities to establish our patent position.



If we are unable to secure additional patent
protection or maintain existing or future patent protection with respect to NXP800, NXP900, or any other proprietary products and technology
we develop, our business, financial condition, results of operations, and prospects would be materially harmed.



We currently hold a license to certain intellectual
property rights relating to NXP800, including its composition of matter and to other compounds that modulate HSF1. In addition, we hold
a license to certain intellectual property relating to NXP900, including its composition of matter and to other compounds that inhibit
the SRC and YES1 kinases.



In May 2021, we licensed one patent family
covering the composition of matter for NXP800, including two issued U.S. patents covering the composition of matter for NXP800, as well
as methods for using and making NXP800. Additionally, patents have been issued in major markets, including the U.S., the European Union,
and Japan. The statutory expiration for the issued U.S. patents in this family is October 2034, without considering any patent extensions
that may or may not be possible.



We have licensed a patent family directed to
additional compounds that modulate HSF1. A patent from this family has been granted in the U.S., and has a statutory expiration of April 2036,
without considering any patent extensions that may or may not be possible.



We have also licensed a patent family directed
to deuterated compounds that modulate HSF1. Any U.S. patent that grants from this family would have a statutory expiration of October 2037,
without considering any patent extensions or patent disclaimers that may or may not be possible.





33









As of August 26, 2021, we licensed one patent
family covering the composition of matter for NXP900, which has been granted in the U.S., EU, Japan, China and is pending in the United
Kingdom and Canada. The statutory expiration for patents in this patent family is April 2036, without considering any possible patent
term extension.



If the scope of our patent protection, whether
now or in the future, with respect to NXP800, NXP900 or our future product candidates and technology is not sufficiently broad, we will
be unable to prevent others from using our technology or from developing or commercializing technology and products similar or identical
to ours or other competing products and technologies. Any failure to obtain or maintain patent protection, through our own patents or
through in-licensing, with respect to NXP800, NXP900 and our future product candidates would have a material adverse effect on our business,
financial condition, results of operations and prospects.



Even if they are unchallenged, our patent applications,
if issued, and any patents we may own or in-license now or in the future, may not provide us with any meaningful protection or prevent
competitors from designing around our patent claims to circumvent any patents we may own or in-license in the future by developing similar
or alternative technologies or therapeutics in a non-infringing manner. If the patent protection provided by our patent applications
or any patents we may pursue with respect to our current or future product candidates is not sufficiently broad to impede competition,
our ability to successfully commercialize our current or future product candidates could be negatively affected, which would harm our
business.



Additionally, we cannot be certain that the claims
in our patent applications covering composition of matter (or other related aspects) of our current or future product candidates or technology
will be considered patentable by the USPTO, or by patent offices in foreign countries, or that the claims in any issued patents we may
own or in-license in the future will be considered patentable by courts in the United States or foreign countries.



The issuance of a patent does not foreclose challenges
to its inventorship, scope, validity or enforceability. Therefore, our owned and in-licensed patents may be challenged in the courts
or patent offices in the United States and elsewhere. Such challenges may result in loss of exclusivity or freedom to operate or in patent
claims being narrowed, invalidated, or held unenforceable, in whole or in part. Successful patent challenges could limit our ability
to stop others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection
of our technology and products. Given the amount of time required for the development, testing and regulatory review of new product candidates,
patents protecting such product candidates might expire before or shortly after such product candidates are commercialized. As a result,
our owned and in-licensed patents may not provide us with sufficient rights to exclude others from commercializing products similar or
identical to ours.



Moreover, we may be subject to a third-party
pre-issuance submission of prior art to the USPTO, or become involved in opposition, derivation, reexamination, inter parties review,
post-grant review or interference proceedings challenging our patent rights or the patent rights of others. An adverse determination
in any such submission, Patent Trial and Appeal Board trial, proceeding or litigation could reduce the scope of, render unenforceable,
or invalidate, our patent rights, allow third parties to commercialize our technology or products and compete directly with us, without
payment to us, or result in our inability to manufacture or commercialize products without infringing third party patent rights. In addition,
if the breadth or strength of protection provided by our patents and patent applications is threatened, it could dissuade companies from
collaborating with us to license, develop or commercialize current or future product candidates.



If we fail to comply with our obligations
in our current license agreements, or in any future agreements under which we may license intellectual property rights from third parties
or otherwise experience disruptions to our business relationships with our current or future licensors, we could lose license rights
that are important to our business.



We are currently party to a license which grants
us certain intellectual property rights relating to our lead product candidate, NXP800, as well as other compounds that modulate HSF1,
and to a license which grants us certain intellectual property rights relating to our second drug candidate, NXP900, as well as other
compounds that inhibit the SRC and YES1 kinases. These agreements impose numerous obligations on us to maintain our licensing rights,
including development, diligence, payment, commercialization, funding, milestone, royalty, sublicensing, insurance, patent prosecution,
enforcement and other obligations. In spite of our efforts, our licensor might conclude that we have materially breached our license
agreement and might therefore terminate the license agreement, thereby removing or limiting our ability to develop and commercialize
NXP800 or NXP900 (and other compounds covered by the licenses).



34







Additionally, in the future, we may be party
to other license or collaboration agreements with third parties to advance our research or allow commercialization of current or future
product candidates. Such future agreements may impose numerous obligations, such as development, diligence, payment, commercialization,
funding, milestone, royalty, sublicensing, insurance, patent prosecution, enforcement and other obligations on us and may require us
to meet development timelines, or to exercise commercially reasonable efforts to develop and commercialize licensed products, in order
to maintain the licenses. In spite of our efforts, our future licensors might conclude that we have materially breached our future license
agreements and might terminate the license agreements, thereby removing or limiting our ability to develop and commercialize products
and technologies covered by these license agreements.



Any termination of these current or future licenses,
or failure of the underlying patents to provide the intended exclusivity, could result in the loss of significant rights and could harm
our ability to commercialize our current or future product candidates, and competitors or other third parties would have the freedom
to seek regulatory approval of, and to market, products identical to ours and we may be required to cease our development and commercialization
of certain of our current or future product candidates. Any of the foregoing could have a material adverse effect on our competitive
position, business, financial conditions, results of operations, and prospects.



If we are unable to protect the confidentiality
of our trade secrets, our business and competitive position would be harmed.



In addition to the protection afforded by patents
we may own or in-license in the future, we seek to rely on trade secret protection, confidentiality agreements, and license agreements
to protect proprietary know-how that is not patentable, processes for which patents are difficult to enforce, and any other elements
of our product discovery and development processes that involve proprietary know-how, information, or technology that is not covered
by patents. Although we require all of our employees, consultants, advisors and any third parties who have access to our proprietary
know-how, information, or technology to enter into confidentiality agreements, trade secrets can be difficult to protect and we have
limited control over the protection of trade secrets used by our collaborators and suppliers.



If we are unable to prevent unauthorized material
disclosure of our intellectual property to third parties, we will not be able to establish or maintain a competitive advantage in our
market, which could materially adversely affect our business, financial condition, results of operations and future prospects.



Third-party claims of intellectual property
infringement, misappropriation or other violations may be costly and time consuming and may prevent or delay our product discovery and
development efforts.



The intellectual property landscape around precision
medicine is crowded, and third parties may initiate legal proceedings alleging that we are infringing, misappropriating, or otherwise
violating their intellectual property rights; the outcome of which would be uncertain and could have a material adverse effect on the
success of our business. We or any of our future licensors or strategic partners may be party to, exposed to, or threatened with, future
adversarial proceedings or litigation by third parties having patent or other intellectual property rights alleging that our current
or future product candidates and/or proprietary technologies infringe, misappropriate or otherwise violate their intellectual property
rights. Thus, because of the large number of patents issued and patent applications filed in our fields, there may be a risk that third
parties may allege they have patent rights encompassing our current or future product candidates, technologies or methods.



Third parties may assert that we are employing
their proprietary technology without authorization. In addition, because some patent applications in the United States may be maintained
in secrecy until the patents are issued, patent applications in the United States and many foreign jurisdictions are typically not published
until 18 months after filing, and publications in the scientific literature often lag behind actual discoveries, we cannot be certain
that others have not filed patent applications covering our current or future product candidates or technology. If any such patent applications
issue as patents, and if such patents have priority over our patent applications or patents we may own or in-license, we may be required
to obtain rights to such patents owned by third parties which may not be available on commercially reasonable terms or at all, or may
only be available on a non-exclusive basis.





35







In the event of a successful claim of infringement,
misappropriation or other violation against us, we may have to pay substantial damages, including treble damages and attorneys’
fees for willful infringement, obtain one or more licenses from third parties, pay royalties or redesign our infringing products, which
may be impossible or require substantial time and monetary expenditure.



Changes to patent law in the United States
and in foreign jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our products.



Our success is heavily dependent on intellectual
property, particularly patents. Recent U.S. Supreme Court rulings have narrowed the scope of patent protection available in certain circumstances
and weakened the rights of patent owners in certain situations. In addition to increasing uncertainty with regard to our ability to obtain
patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained. Laws and
regulations governing patents could change in unpredictable ways that would weaken our ability to obtain new patents or to enforce patents
that we might obtain in the future.



We may be subject to claims challenging
the inventorship or ownership of any intellectual property, including any patents we may own or in-license currently or in the future.



We may be subject to claims that former employees,
collaborators or other third parties have an interest in any patents we may own or in-license currently or in the future, trade secrets,
or other intellectual property as an inventor or co-inventor. Litigation may be necessary to defend against these and other claims challenging
inventorship of any patents we may own or in-license in the future, trade secrets or other intellectual property.



We may be subject to claims that our employees,
consultants or independent contractors have wrongfully used or disclosed confidential information or alleged trade secrets of third parties
or competitors or are in breach of non-competition or non-solicitation agreements with our competitors.



We may be subject to claims that we or our employees,
consultants or independent contractors have inadvertently or otherwise used or disclosed confidential information or trade secrets of
these third parties or our employees’ former employers or our consultants’ or contractors’ current or former clients
or customers. Litigation or arbitration may be necessary to defend against these claims.



If we do not obtain patent term extension
and data exclusivity for any of our current or future product candidates we may develop, our business may be materially harmed.



Depending upon the timing, duration and specifics
of any FDA marketing approval of any of our current or future product candidates we may develop, one or more U.S. patents we may own
or in-license in the future may be eligible for limited patent term extension under the Drug Price Competition and Patent Term Restoration
Act of 1984, or the Hatch-Waxman Amendments. If we are unable to obtain patent term extension or the term of any such extension is shorter
than what we request, our competitors may obtain approval of competing products following expiration of any patents that issue from our
patent applications, and our business, financial condition, results of operations, and prospects could be materially harmed.



If our trademarks and trade names are not
adequately protected, then we may not be able to build name recognition in our marks of interest and our business may be adversely affected.



Our trademarks or trade names may be challenged,
infringed, diluted, circumvented or declared generic or determined to be infringing on other marks. We intend to rely on both registration
and common law protection for our trademarks. We may not be able to protect our rights to these trademarks and trade names or may be
forced to stop using these names, which we need for name recognition by potential partners or customers in our markets of interest. If
we are unable to obtain a registered trademark or establish name recognition based on our trademarks and trade names, we may not be able
to compete effectively and our business may be adversely affected.





36







Risks Related to our Reliance on Third Parties



We plan to rely on third parties to conduct
our preclinical studies and clinical trials. If these third parties do not properly and successfully carry out their contractual duties
or meet expected deadlines, we may not be able to obtain regulatory approval of or commercialize our current or future product candidates.



We plan to utilize and depend upon independent
investigators and collaborators, such as medical institutions, CROs, CMOs, and strategic partners to conduct and support our preclinical
studies and clinical trials under agreements with us. We rely upon, and plan to continue to rely upon, such third-party entities to execute
our clinical trials and preclinical studies and to monitor and manage data produced by and relating to those studies and trials. However,
in the future we may not be able to establish arrangements with CROs when needed or on terms that are acceptable to us, or at all, which
could negatively affect our development efforts with respect to our drug candidates and materially harm our business, operations and
prospects. As a result of the use of third-party contractors, we will have only limited control over certain aspects of their activities.
Nevertheless, we are responsible for ensuring that each of our studies, including each of our clinical trials, is conducted in accordance
with the applicable protocol, legal and regulatory requirements as well as scientific standards, and our reliance on any third-party
entity will not relieve us of our regulatory responsibilities.



Based on our present expectations, we and our
third-party contractors will be required to comply with GCP regulations for the clinical development of all of our drug candidates. If
we or any of these third parties fail to comply with applicable GLP or GCP regulations, the clinical data generated in our preclinical
and clinical trials may be deemed unreliable and the FDA or comparable foreign regulatory authorities may require us to perform additional
clinical trials before approving our marketing applications, which we may not have sufficient cash or other resources to support and
which would delay our ability to generate revenue from future sales of such drug candidate. Any agreements governing our relationships
with CROs or other contractors with whom we currently engage or may engage in the future may provide those outside contractors with certain
rights to terminate a clinical trial under specified circumstances. If such an outside contractor terminates its relationship with us
during the performance of a clinical trial, we would be forced to seek an engagement with a substitute contractor, which we may not be
able to do on a timely basis or on commercially reasonable terms, if at all, and the applicable clinical trial would experience delays
or may not be completed.



Large-scale clinical trials require significant
additional financial and management resources and reliance on third-party clinical investigators, CROs, and consultants, which may cause
us to encounter delays that are outside of our control. We may be unable to identify and contract with sufficient investigators, CROs,
or consultants on a timely basis, if at all.



If these third parties do not successfully carry
out their contractual duties or obligations or meet expected deadlines, if they need to be replaced, or if the quality or accuracy of
the clinical data they obtain is compromised due to the failure to adhere to our clinical protocols, legal and regulatory requirements
or for other reasons, our preclinical or clinical trials may be extended, delayed or terminated and we may not be able to complete development
of, obtain regulatory approval for, or successfully commercialize, our current or future product candidates. In addition, we will be
unable to control whether or not they devote sufficient time and resources to our preclinical and clinical programs. These outside contractors
may not assign as great a priority to our programs or pursue them as diligently as we would if we were undertaking such programs ourselves.
As a result, our operations and the commercial prospects for the effected drug candidates would be harmed, our costs could increase and
our ability to generate revenues could be delayed. These contractors may also have relationships with other commercial entities, some
of whom may compete with us. If our contractors assist our competitors to our detriment, our competitive position would be harmed.



If our relationships with any third parties conducting
our studies are terminated, we may be unable to enter into arrangements with alternative third parties on commercially reasonable terms,
or at all. Switching or adding third parties to conduct our studies involves substantial cost and requires extensive management time
and focus. In addition, there is a natural transition period when a new third party commences work. As a result, delays occur, which
can materially impact our ability to meet our desired clinical development timelines. Although we carefully manage our relationships
with third parties conducting our studies, we cannot assure you that we will not encounter similar challenges or delays in the future
or that these delays or challenges will not have a material and adverse effect on our business, financial condition and results of operations.





37







We rely, and expect to continue to rely,
on the third-party manufacturers to manufacture our current or future product candidates. Reliance on third parties increases the risk
that we will not have sufficient quantities of our products or such quantities at an acceptable quality and cost, which could delay,
prevent or impair our development or commercialization efforts.



We do not currently own any facility that may
be used as our clinical-scale manufacturing and processing facility and must rely on outside vendors to manufacture our current or future
product candidates. We rely on a single CMO for manufacturing the NXP800 drug substance and the NXP800 drug product, which are manufactured
at two different sites of the same CMO. We intend to continue our relationship with this CMO for the supply of NXP800; however, there
can be no assurance that we will be able to retain this relationship on commercially reasonable terms, if at all. If we are unable to
maintain this relationship, we could experience delays in our development efforts as we locate and qualify a new CMO. For the in vitro
and in vivo experiments of NXP900 conducted to date, small, lab-scale, non cGMP material has been used. We will need to identify an appropriate
cGMP CMOs for the manufacture of NXP900 drug substance and drug product, and there is no assurance that such CMOs will be successful
in manufacturing NXP900 drug substance or product. If NXP800, NXP900 or any other drug candidate we may develop or acquire in the future
receives regulatory approval, we will rely on one or more CMOs to manufacture the commercial supply of such drugs.



Our anticipated reliance on a limited number
of third-party manufacturers exposes us to a number of risks, including:



| | ➢ | due
                                            to the limited number of potential manufacturers, and because the FDA requires inspection
                                            of any manufacturers’ cGMP compliance as part of our marketing application, we may
                                            be unable to identify manufacturers on acceptable terms, if at all;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | a
                                            new manufacturer would have to be educated in and develop substantially equivalent processes
                                            for, the production of our current or future product candidates;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | our
                                            third-party manufacturers might be unable to timely manufacture our current or future product
                                            candidates or produce the quantity and quality required to meet our clinical and commercial
                                            needs due to a variety of potential reasons including failure to achieve drug substance or
                                            drug product specifications, batch to batch inconsistencies, site or equipment contaminations,
                                            failed regulatory inspections, competition for production capacity and availability from
                                            other customers;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | we
                                            may not own, or may have to share, the intellectual property rights to any improvements made
                                            by our third-party manufacturers in the manufacturing process for our current or future product
                                            candidates;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | our
                                            third-party manufacturers could breach or terminate their agreements with us;
| | - | -----------------------------------------------------------------------------------------------------------------------------



| | ➢ | our
                                            third-party manufacturers might be unable to formulate and manufacture our drugs in the volume
                                            and of the quality required to meet our clinical and commercial needs, if any;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | our
                                            third-party manufacturers may not perform as contractually agreed or may not remain in the
                                            contract manufacturing business for the time required to supply our clinical trials or to
                                            successfully produce, store and distribute our products;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | drug
                                            manufacturers are subject to ongoing periodic unannounced inspection by the FDA and some
                                            state agencies in the United States, as well as foreign regulatory authorities, to ensure
                                            strict compliance with cGMP regulations and other regulatory requirements; and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





38







| | ➢ | raw
                                            materials and components used in the manufacturing process, particularly those for which
                                            we have no other source or supplier, may not be available or may not be suitable or acceptable
                                            for use due to material or component defects.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Each of these risks could delay or prevent the
completion of our preclinical or clinical trials or the approval of any of our current or future product candidates by the FDA or another
foreign regulatory authority, result in higher costs or adversely impact commercialization of our current or future product candidates.



Although our agreements with our CMOs require
them to perform according to certain cGMP requirements such as those relating to quality control, quality assurance and qualified personnel,
we cannot control the conduct of our CMOs to implement and maintain these standards. If any of our CMOs cannot successfully manufacture
material that conforms to our specifications and the regulatory requirements of the FDA, EMA or other comparable foreign authorities,
we could be prevented from obtaining regulatory approval for our drug candidates unless and until we engage a substitute CMO that can
comply with such requirements, which we may not be able to do. Any such failure by any of our CMOs would significantly impact our ability
to develop, obtain regulatory approval for or market our drug candidates, if approved.



If our third-party manufacturers use hazardous
and biological materials in a manner that causes injury or violates applicable law, we may be liable for damages.



Although we believe that our manufacturers’
procedures for using, handling, storing, and disposing of hazardous and biological materials comply with legally prescribed standards,
we cannot completely eliminate the risk of contamination or injury. In the event of an accident, local, city, state or federal authorities
may curtail the use of these materials and interrupt our business operations. Further, we could be held liable for damages or penalized
with fines, and the liability could exceed our resources. We do not have any insurance for liabilities arising from medical or hazardous
materials.



Risks Related to Managing Growth and Employee
Matters



We are highly dependent on our key personnel
and anticipate hiring new key personnel. If we are not successful in attracting and retaining highly qualified personnel, we may not
be able to successfully implement our business strategy.



Our ability to compete in the highly competitive
biotechnology and pharmaceutical industries depends upon our ability to attract and retain highly qualified managerial, scientific and
medical personnel. We are highly dependent on our management, scientific and medical personnel, including our Chairman, Chief Executive
Officer and President, our Chief Scientific and Business Officer and our Chief Development and Operations Officer. While we expect to
engage in an orderly transition process as we integrate newly appointed officers and managers, we face a variety of risks and uncertainties
relating to management transition, including diversion of management attention from business concerns, failure to retain other key personnel
or loss of institutional knowledge.



We will need to grow the size of our organization,
and we may experience difficulties in managing this growth.



As of March 22, 2022, we had 8 full-time
employees. We also contract for various services through consulting and vendor agreements. We intend to hire new employees to conduct
our research and development activities in the future. Any delay in hiring such new employees could result in delays in our research
and development activities and would harm our business. As our development and commercialization plans and strategies develop, and as
we transition into operating as a public company, we expect to need additional managerial, operational, sales, marketing, financial and
other personnel, as well as additional facilities to expand our operations.



If we are not able to effectively expand our
organization by hiring new employees and expanding our groups of consultants and contractors, or we are not able to effectively build
out new facilities to accommodate this expansion, we may not be able to successfully implement the tasks necessary to further develop
and commercialize our current or future product candidates and, accordingly, may not achieve our research, development and commercialization
goals.





39







We will incur significant increased costs
as a result of operating as a public company, and our management will be required to devote substantial time to compliance activities
and initiatives.



As a public company, we will incur significant
legal, accounting, and other expenses that we did not incur as a private company. We are now subject to the reporting requirements of
the Securities Exchange Act of 1934, as amended, which requires, among other things, that we file with the SEC, annual, quarterly, and
current reports with respect to our business and financial condition. In addition, the Sarbanes-Oxley Act of 2002 (“SOX”),
as well as rules subsequently adopted by the SEC and the Nasdaq Capital Market to implement provisions of SOX, impose significant
requirements on public companies, including requiring establishment and maintenance of effective disclosure and financial controls and
changes in corporate governance practices.



Moreover, these rules and regulations will
increase our legal and financial compliance costs and make some activities more time-consuming and costly. For example, these rules and
regulations make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required
to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result,
it may be more difficult for us to attract and retain qualified persons to serve on our Board of Directors, our Board committees or as
executive officers.



SOX requires, among other things, that we maintain
effective internal control over financial reporting and disclosure controls and procedures. As a result, we are required to periodically
perform an evaluation of our internal control over financial reporting to allow management to report on the effectiveness of those controls,
as required by Section 404 of SOX. These efforts to comply with Section 404 will require the commitment of significant financial
and managerial resources. While we anticipate maintaining the integrity of our internal control over financial reporting and all other
aspects of Section 404, we cannot be certain that a material weakness will not be identified when we test the effectiveness of our
control systems in the future. If a material weakness is identified, we could be subject to sanctions or investigations by the SEC or
other regulatory authorities, which would require additional financial and management resources, costly litigation or a loss of public
confidence in our internal control, which could have an adverse effect on the market price of our stock.



Our business and operations would suffer
in the event of computer system failures, cyber-attacks, or deficiencies in our or third parties’ cybersecurity.



We are increasingly dependent upon information
technology systems, infrastructure, and data to operate our business. In the ordinary course of business, we may collect, store, and
transmit confidential information, including, but not limited to, information related to our intellectual property and proprietary business
information, personal information, and other confidential information. We have outsourced elements of our operations to third party vendors,
who each have access to our confidential information, which increases our disclosure risk. Although we have implemented internal security
and business continuity measures, our information technology and other internal infrastructure systems may breakdown, incur damage or
be interrupted by system malfunctions, natural disasters, terrorism, war, or telecommunication and electrical failures, as well as by
inadvertent or intentional security breaches by our employees, contractors, consultants, business partners, and/or other third parties,
or from cyber-attacks by malicious third parties, each of which could compromise our system infrastructure or lead to the loss, destruction,
alteration, disclosure, or dissemination of, or damage or unauthorized access to, our data or other assets. Such a security breach may
cause loss, damage, or disclosure of proprietary or confidential information, which could in turn result in significant legal and financial
exposure and reputational damage that could adversely affect our business. Furthermore, the loss or corruption of clinical trial data
from future clinical trials may result in delays in our regulatory approval efforts and could significantly increase our costs to recover
or reproduce the data.



The costs related to significant security breaches
or disruptions could be material and our insurance policies may not be adequate to compensate us for the potential losses arising from
any such security breach. In addition, such insurance may not be available to us on economically reasonable terms, if at all, may not
cover all claims made against us, and may have high deductibles. Furthermore, if the information technology systems of our third-party
vendors and other contractors and consultants become subject to disruptions or security breaches, we may have insufficient recourse against
such third parties and we may have to expend significant resources to mitigate the impact of such an event, and to develop and implement
protections to prevent future events of this nature from occurring.





40







Risks Related to Commercial Activities



If any of our current or future product
candidates do not achieve broad market acceptance among physicians, patients, healthcare payors and the medical community, the revenues
from any such current or future product candidate may be limited.



The use of precision medicines as a potential
cancer treatment is a recent development and may not become broadly accepted by physicians, patients, hospitals, cancer treatment centers,
and others in the medical community. We cannot predict whether physicians, patients, hospitals, cancer treatment centers, and government
agencies or third-party payors will determine that our product is safe, therapeutically effective, and cost effective as compared with
competing treatments. If our current or potential future product candidates do not achieve an adequate level of market acceptance, we
may not generate significant product revenues and may not become profitable. Factors influencing acceptance of our current or future
product candidates in the market, include: the clinical indications for which our product candidates are licensed; whether our product
candidates are viewed as a safe and effective treatment; our ability to demonstrate our product’s advantages, including cost advantages,
over alternative treatments; the prevalence and severity of any side effects of our products and of other precision medicines; product
labeling or product insert requirements of the FDA or other regulatory authorities and limitations or warnings contained in the labeling;
the timing of market introduction of our product candidates and competitive products; patient willingness to pay out-of-pocket in the
absence of coverage by third-party payors and government authorities; and the effectiveness of our sales and marketing efforts.



If our current or future product candidates are
licensed but fail to achieve market acceptance among physicians, patients, hospitals, cancer treatment centers or others in the medical
community, we will not be able to generate significant revenue. In addition, although our current or future product candidates may differ
in certain ways from other precision medicine approaches, serious adverse events or deaths in other preclinical or clinical trials involving
precision medicines, even if not ultimately attributable to our current or future products or product candidates, could result in increased
government regulation, unfavorable public perception and publicity, potential regulatory delays in the testing or licensing of our current
or future product candidates, stricter labeling requirements for those product candidates that are licensed, and a decrease in demand
for any such product candidates.



If product liability lawsuits are brought
against us, we may incur substantial liabilities and may be required to limit commercialization of our current or future product candidates.



We face an inherent risk of costly and time-consuming
product liability lawsuits as a result of the planned clinical testing of our current or future product candidates and will face an even
greater risk if we commercialize any products. For example, we may be sued if our current or future product candidates cause or are perceived
to cause injury or are found to be otherwise unsuitable during clinical testing, manufacturing, marketing or sale. If we cannot successfully
defend ourselves against product liability claims, we may incur substantial liabilities or be required to limit commercialization of
our current or future product candidates. Failure to obtain or retain sufficient product liability insurance at an acceptable cost may
prevent or inhibit the commercialization of products we may develop. Although we have clinical trial insurance, our insurance policies
have various exclusions, and we may be subject to a claim for which we have no coverage. We may have to pay any amounts awarded by a
court or negotiated in a settlement that are not covered by or which exceed our insurance coverage, and we may not have sufficient capital
to pay such amounts.





41







Risks Related to Ownership of our Common Stock



We do not know whether an active, liquid
and orderly trading market will develop for our common stock or what the market price of our common stock will be and, as a result, it
may be difficult for you to sell your shares of our common stock.



Prior to the pricing of our initial public offering
on February 4, 2022, there was no public trading market for shares of our common stock. Although our common stock is listed on the
Nasdaq Capital Market, an active trading market for our shares is still developing and may not be sustained in the future. The lack of
an active market for our common stock may impair investors’ ability to sell their shares at the time they wish to sell them or
at a price that they consider reasonable and may reduce the fair market value of their shares. Further, an inactive market may impair
our ability to raise capital by selling shares of our common stock and to enter into strategic partnerships or acquire companies or products
using our shares of common stock as consideration.



Our growth is subject to economic and political
conditions.



Our business is affected by global and local
economic and political conditions as well as the state of the financial markets, inflation, recession, financial liquidity, currency
volatility, growth, and policy initiatives. There can be no assurance that global economic conditions and financial markets will not
worsen and that we will not experience any adverse effects that may be material to our consolidated cash flows, results of operations,
financial position or our ability to access capital, such as the adverse effects resulting from a prolonged shutdown in government operations
both in the United States and internationally. Political changes, including war or other conflicts, some of which may be disruptive,
could interfere with our supply chain, our customers and all of our activities in a particular location.



We do not intend to pay dividends on our
common stock in the foreseeable future, so any returns will be limited to the value of our stock, which may be volatile.



We plan to retain future earnings for the development,
operation, and expansion of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. Any
return to stockholders will be limited to the appreciation of their stock, which may never occur. Further, the trading price of our common
stock is likely to be highly volatile and may be subject to wide fluctuations in response to various factors, some of which are beyond
our control. Broad market and industry factors may negatively affect the market price of our common stock, regardless of our actual operating
performance.



If equity research analysts do not publish
research or reports about our business or if they publish negative evaluations of or downgrade our common stock, the price of our common
stock could decline.



The trading market for our common stock relies
in part on the research and reports that equity research analysts publish about us or our business. We do not control these analysts.
We may never obtain research coverage by industry or financial analysts. If no or few analysts publish research reports on the Company
or if analysts publish negative research reports about the Company, our stock price may significantly decline.



Raising additional capital may cause dilution
to our existing stockholders, restrict our operations, or require us to relinquish rights to our current or future technologies or product
candidates.



We may seek additional capital through a combination
of public and private equity offerings, debt financings, strategic partnerships and alliances and licensing arrangements. Any equity
or equity-related financing may dilute our stockholders may subject us to restrictive covenants and interest costs. If we obtain funding
through a strategic collaboration or licensing arrangement, we may be required to relinquish our rights to our current product candidates
or any future product candidates that we may develop.



Additional fundraising efforts may divert our
management from their day-to-day activities, which may adversely affect our operations. If we are unable to raise additional capital
as needed or on acceptable terms, we may be required to delay or discontinue any research, development or commercialization programs
and may be unable to expand our operations or otherwise capitalize on our business opportunities. Further, we may be required to seek
collaborators for potential product candidates earlier, or on less favorable terms, than might otherwise be desired, or to relinquish
or license our rights to potential product candidates in markets where we otherwise would seek to pursue development or commercialization.
Any of the above events could significantly harm our business, prospects, financial condition and results of operations and cause the
price of our common stock to decline.





42







Our principal stockholders and management
own a significant percentage of our stock and will be able to exert significant influence over matters subject to stockholder approval.



As of March 22, 2022, our executive officers,
directors, and 5% stockholders beneficially owned approximately 66.8% of our voting stock and anticipate that the same group will hold
a significant portion of our outstanding voting stock for the foreseeable future. These stockholders will have the ability to influence
us through their ownership position. This may prevent or discourage unsolicited acquisition proposals or offers for our common stock.



Our failure to meet the continuing listing
requirements of the NASDAQ Capital Market could result in a de-listing of our securities.



If we fail to satisfy the continuing listing
requirements of NASDAQ, such as the corporate governance, stockholders’ equity or minimum closing bid price requirements, NASDAQ
may take steps to delist our common stock. Such a delisting would likely have a negative effect on the price of our common stock and
would impair our stockholders’ ability to sell or purchase our common stock. In the event of a delisting, we would likely take
actions to restore our compliance with NASDAQ’s listing requirements, but we can provide no assurance that any such action taken
by us would allow our common stock to become listed again, stabilize the market price or improve the liquidity of our securities, prevent
our common stock from dropping below the NASDAQ minimum bid price requirement or prevent future non-compliance with NASDAQ’s listing
requirements.



We are an emerging growth company and a
smaller reporting company, and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies and
smaller reporting companies will make our common stock less attractive to investors.



We are an emerging growth company, as defined
in the JOBS Act. For as long as we continue to be an emerging growth company, we may take advantage of exemptions from various reporting
requirements that are applicable to other public companies that are not emerging growth companies, including: exemption from the auditor
attestation requirements of Section 404 of SOX, as amended; being permitted to provide only two years of our audited financial statements
and correspondingly reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations”;
exemption from any Public Company Accounting Oversight Board requirement regarding audit firm rotation or an auditor report supplement
providing additional information about the audit and financial statements; reduced disclosure obligations regarding executive compensation;
and exemption from the nonbinding advisory votes on executive compensation and stockholder approval of any golden parachute payments
not previously approved.



We have elected to take advantage of certain
of the reduced reporting obligations. We cannot predict whether investors will find our common stock less attractive if we rely on these
exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common
stock and our stock price may be reduced or more volatile.



Provisions in our certificate of incorporation,
our bylaws, and Delaware law may discourage, delay, or prevent a change in control of our Company or changes in our management and, as
a result, depress the trading price of our stock.



Provisions of our certificate of incorporation,
our bylaws and Delaware law may deter unsolicited takeovers and/or delay or prevent a change in control of our Company, including transactions
in which our stockholders might otherwise receive a premium for their shares.



In addition, the Delaware General Corporation
Law prohibits a publicly held Delaware corporation from engaging in a business combination with an interested stockholder, defined as
a person who owns, or within the last three years has owned, 15% of our voting stock, for a period of three years after the date of the
transaction in which the person became an interested stockholder, unless the business combination is approved in a prescribed manner.





43







The foregoing provisions and anti-takeover measures
may limit the price that investors might be willing to pay in the future for shares of our Common Stock and may deter potential acquirers
of our Company.



|Item 1B. | Unresolved Staff Comments
|-------- | -------------------------



None.



|Item 2. | Properties
|------- | ----------



On May 3, 2021, we entered into a one-year
lease for office space at 1 Bridge Plaza, 2nd Floor, Fort Lee, NJ 07024. We have taken possession of this space, which serves
as our principal executive offices. Total rent expense over the full term of the lease will be approximately $15,000. We believe that
our existing facilities are adequate to meet our current requirements. We plan to extend the lease prior to its expiration on May 3,
2022.



|Item 3. | Legal Proceedings
|------- | -----------------



From time to time, we may become involved in
legal proceedings arising in the ordinary course of our business, the resolution of which we do not anticipate would have a material
adverse impact on our financial position, results of operations or cash flows. However, there is no certainty that any such future litigation
that may arise would not have a material financial impact on our business. As of the date of this report, we were not a party to any
material legal matters or claims.



|Item 4. | Mine Safety Disclosures
|------- | -----------------------



Not applicable.



​PART II



|Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities
|------- | ------------------------------------------------------------------------------------------------------------



Market Information



Our common stock is listed on the NASDAQ Capital
Market and trades under the symbol “NVCT.” We commenced trading on the NASDAQ Capital Market on February 4, 2022. Prior
to that date, there was no public market for our common stock.



Equity Compensation Plans



On May 23, 2021 (the “Effective Date”),
our Board of Directors (the “Board”) adopted the Centry Pharma, Inc. Global Equity Incentive Plan (the “2021 Plan”),
which will continue in effect for ten years from the Effective Date. We intend to file one or more registration statements on Form S-8
under the Securities Act to register our shares issued or reserved for issuance under our equity incentive plans. The first such registration
statement is expected to be filed soon after the date of this report and will automatically become effective upon filing with the SEC.
Accordingly, shares registered under such registration statement will be available for sale in the open market, unless such shares are
subject to vesting restrictions with us or lock-up restrictions pursuant to our initial public offering.





44







Securities Authorized for Issuance under Equity
Compensation Plans



The following table provides certain information
as of December 31, 2021, with respect to all of our equity compensation plans in effect on that date:



|                                                                          |  |                  |         |  |                   |   |      | Number of            | 
|------------------------------------------------------------------------- |  | ---------------- | ------- |  | ----------------- | - | ---- | -------------------- | 
|                                                                          |  |                  |         |  |                   |   |      | securities           | 
|                                                                          |  |                  |         |  |                   |   |      | remaining            | 
|                                                                          |  |                  |         |  |                   |   |      | available for        | 
|                                                                          |  | Number of        |         |  |                   |   |      | future issuance      | 
|                                                                          |  | securities to be |         |  |                   |   |      | under equity         | 
|                                                                          |  | issued upon      |         |  | Weighted-average  |   |      | compensation         | 
|                                                                          |  | exercise of      |         |  | exercise price of |   |      | plans (excluding     | 
|                                                                          |  | outstanding      |         |  | outstanding       |   |      | securities reflected | 
|Plan Category                                                             |  | options          |         |  | options           |   |      | in column 1)         | 
|Equity compensation plans approved by security
    holders, the 2021 Plan |  |                  | 375,063 |  |                   | $ | 2.67 |                      | 
|Equity compensation plans not approved
    by security holders            |  |                  | 193,557 |  |                   |   | 0.00 |                      | 
|Total                                                                     |  |                  | 568,620 |  |                   | $ | 1.76 |                      | 



The Company’s 2021 Plan, which was amended
upon the completion of the initial public offering in February 2022, has 1,500,000 shares of common stock available for issuance.



Holders



As of March 17, 2022, there were approximately
43 holders of record of our common stock. The number of beneficial holders of our common stock does not reflect shareholders who hold
shares in street name through brokerage accounts or other nominees.



Dividends



We have never paid cash dividends on any of our
capital stock and currently intend to retain our future earnings, if any, to fund the development and growth of our business.



Recent Sales of Unregistered Securities



Since July 27, 2020, we have made the issuances
of our unregistered securities described below. Also included is the consideration received by us for such securities and information
relating to the section of the Securities Act, or rule of the SEC, under which exemption from registration was claimed.



During June and July 2021, the Company
closed an investment agreement with its founders, directors, and certain new investors to issue 128,520 Series A Preferred shares,
at a price of approximately $119.05 per share, for a total investment amount of approximately $15.3 million, in which $1.73 million were
invested by related parties on the same terms as all other investors. These securities were offered and sold by us in reliance upon the
exemption from the registration requirements provided by Section 4(a)(2) of the Securities Act and Rule 506(b) of
Regulation D promulgated thereunder in a transaction by an issuer not involving any public offering. All the Series A preferred
shares were converted into 5,012,280 shares of common stock of the Company upon the completion of our initial public offering.





45







Use of Proceeds from Sales of Registered Securities



On February 4, 2022, our registration statement
on Form S-1 (File No. 333-260099) and our registration statement on Form S-1MEF (File No. 333-262512) (collectively,
the “Registration Statements”) were declared effective by the SEC. Pursuant to such Registration Statements, we sold an aggregate
of 3,200,000 shares of our common stock at a price of $5.00 per share for aggregate net cash proceeds of approximately $13.6 million,
which amount is net of $1.12 million in underwriter’s discounts, commissions and expenses, and $1.3 million of other expenses incurred
in connection with the offering. We closed the offering on February 8, 2022. H.C. Wainwright & Co. acted as sole book-running
manager for the offering.



We intend to use the net proceeds of this offering
to fund the Phase 1/2 development of NXP800, to continue development and sponsored research related to our current product candidates
or any future product candidate, hiring of additional personnel, capital expenditures, costs of operating as a public company and other
general corporate purposes.



There has been no material change in the expected
use of the net proceeds from our initial public offering as described in our final prospectus filed with the SEC on February 8,
2022 pursuant to Rule 424(b) under the Securities Act. We invested the funds received in an interest-bearing money market
account.



|Item 6. | [RESERVED.]
|------- | -----------





46







|Item 7. | Management’s Discussion and Analysis of the Results of Operations
|------- | -----------------------------------------------------------------



You should read the following discussion and
analysis of our financial condition and results of operations together with our financial statements and related notes appearing elsewhere
in this report. Some of the information contained in this discussion and analysis or set forth elsewhere in this report, including information
with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks
and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section of this report,
our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the
following discussion and analysis.



Overview



We are a biopharmaceutical company focused on
the development of novel targeted small molecule therapeutics for the treatment of cancer in genetically defined patient populations.
Our precision medicine approach translates key scientific insights relating to the oncogenic drivers and pathway addiction of cancer
into potent and highly selective anticancer drugs. In addition, we will investigate the relevance of specific mutations and other DNA
alterations as a potential patient selection marker and to identify synthetic lethality targets. This work could support our use of a
tumor agnostic development strategy wherein we enroll patients based on the cancer’s genetic and molecular features without regard
to the type or location of the cancer. Since our inception in 2020, we have devoted substantially all of our efforts and financial resources
to organizing and staffing our company, business planning, raising capital, acquiring, discovering product candidates and securing related
intellectual property rights and conducting research and development activities for our programs. We do not have any products approved
for sale and have not generated any revenue from product sales. We may never be able to develop or commercialize a marketable product.
We have not yet successfully completed any pivotal clinical trials, obtained any regulatory approvals, manufactured a commercial-scale
drug, or conducted sales and marketing activities.



Results of Operations



From our inception on July 27, 2020, through
December 31, 2021, we did not generate any revenue. Our main activities through December 31, 2021 have been organizational
and capital raising activities and the completion of the in-license agreements for our two drug candidates, NXP800 and NXP900, CTA filing
with the MHRA and preparation for the Phase 1a clinical trial for NXP800, which commenced in December 2021, and preparing for our
initial public offering.



For the year ended December 31, 2021, we
incurred research and development expenses of $9.6 million, primarily related to the one-time upfront payments totaling $7.0 million
paid out in connection with the exclusive license agreements for our product candidates, NXP800 and NXP900, and $0.9 million of non-cash
equity-based expenses. During the period from our inception to December 31, 2020, we did not incur any research and development
expenses.



For the year ended December 31, 2021, our
general and administrative expenses were $3.3 million, primarily attributable to $1.0 million of non-cash equity-based expenses and $2.0
paid to certain third-party service providers and consultants. During the period from our inception to December 31, 2020, we did
not incur any material general and administrative expenses.



As a result of the foregoing, our loss from operations
for the year ended December 31, 2021 was $12.9 million, compared to a loss from operations of $10,000 for the period from our inception
to December 31, 2020.



We expect our research and development and general and administrative
expenses to increase substantially in the future as we begin the execution of our business plan for our two pipeline product candidates,
NXP800 and NXP900 and continue to build-out our infrastructure to support such research and development activities.



Liquidity and Capital Resources



As of December 31, 2021, we had $5.7 million
of cash and cash equivalents.





47







In June and July 2021, we completed
a $15.3 million capital raise through the issuance of preferred stock which was paid out in connection with an exclusive licensing agreement
related to our lead product candidate, NXP800. In June 2021 we paid an upfront payment of $3.5 million in connection with the NXP800
license agreement. In August 2021 we closed the exclusive license agreement related to our second product candidate, NXP900. In
September 2021 we paid the upfront payment in connection with this license agreement, also in the amount of $3.5 million.



On February 4, 2022, we entered into an
underwriting agreement with H.C. Wainwright & Co. (the “Underwriter”), as sole book-running manager, in connection
with our initial public offering of common stock (the “IPO”). On February 4, 2022, we announced the pricing of our IPO
of 3,200,000 shares of common stock for a price of $5.00 per share, less certain underwriting discounts and commissions. Upon closing
of the IPO, we issued 128,000 representative warrants, with an exercise price of $6.25, to purchase common stock to the Underwriter,
equaling 4% of the total shares sold in the IPO. We also granted the Underwriter a 30-day option to purchase up to 480,000 additional
shares of common stock to cover any over-allotments (the “Over-Allotment Option"), and the right to receive, upon exercise
of the Over-allotment Option, a number of additional warrants to purchase common stock totaling 4% of the shares sold in the IPO (including
the 128,000 previously issued), on the same terms and conditions for the purpose of covering any over-allotments in connection with the
IPO. No overallotment shares were purchased by the Underwriter and no Over-Allotment Options were granted to the Underwriter. As part
of the UoE license agreement, the Company owes UoE $0.4 million associated with this fund raising. We will pay UoE 2.5% of the gross
amount of each of the Company’s future fund raisings up to a cumulative total of $3.0 million, including this $0.4 million.



The IPO closed on February 8, 2022, with
a result of gross proceeds of $16.0 million, before deducting underwriting discounts and expenses (for net proceeds of $13.6 million).
The sole book-running manager did not exercise the over-allotment option which has already expired. We believe that the proceeds from
our IPO will enable us to fund our operating expenses and capital expenditures through at least the next 12 months from the issuance
of our financial statements. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available
capital resources sooner than we expect. Our future viability in the long term is dependent on our ability to raise additional capital
to finance our operations.



We expect our expenses to increase substantially
in connection with our ongoing activities, particularly as we advance the preclinical activities and clinical trials of our current or
future product candidates, including payments of milestones and sponsored research commitments associated with our license agreements
for NXP800 and NXP900. In addition, now that we have closed our initial public offering, we expect to incur additional costs associated
with operating as a public company, including significant legal, accounting, investor relations and other expenses that we did not incur
as a private company. The timing and amount of our operating expenditures will depend largely on our ability to:



| | ➢ | advance
                                            development of our clinical and preclinical programs;
| | - | ---------------------------------------------------------------------------------------------------------



| | ➢ | acquire
                                            additional product candidates;
| | - | ----------------------------------------------------------------------------------



| | ➢ | manufacture,
                                            or procure the manufacturing of, our preclinical and clinical drug material and develop processes
                                            for late stage and commercial manufacturing;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | seek
                                            regulatory approvals for any current or future product candidates that successfully complete
                                            clinical trials;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | achieve
                                            milestones in accordance with our license agreements;
| | - | ---------------------------------------------------------------------------------------------------------



| | ➢ | establish
                                            a sales, marketing, medical affairs and distribution infrastructure to commercialize any
                                            current or future product candidates for which we may obtain marketing approval for;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | hire
                                            additional clinical, quality control and scientific personnel;
| | - | ---------------------------------------------------------------------------------------------------------------





48









| | ➢ | expand
                                            our operational, financial and management systems and increase personnel, including personnel
                                            to support our clinical development, manufacturing and commercialization efforts and our
                                            operations as a public company; and
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | obtain,
                                            maintain, expand and protect our intellectual property portfolio.
| | - | ---------------------------------------------------------------------------------------------------------------------



We anticipate that we will require additional
capital as we seek regulatory approval of our product candidates and if we choose to pursue in-licenses or acquisitions of other product
candidates. If we receive regulatory approval for our other future product candidates, we expect to incur significant commercialization
expenses related to product manufacturing, sales, marketing and distribution, depending on where we choose to commercialize.



Because of the numerous risks and uncertainties
associated with research, development and commercialization of our product candidates, we are unable to estimate the exact amount of
our working capital requirements. Our future funding requirements will depend on and could increase significantly as a result of many
factors, including:



|➢ | the
                                            scope, progress, results and costs of researching and developing our current or future product
                                            candidates, and conducting preclinical and clinical trials;
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                       

| | ➢ | the
                                            costs, timing and outcome of regulatory review of our current or future product candidates;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            costs, timing and ability to manufacture our current or future product candidates to supply
                                            our clinical and preclinical development efforts and our clinical trials;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            costs of future activities, including product sales, medical affairs, marketing, manufacturing
                                            and distribution, for any of our current or future product candidates for which we receive
                                            marketing approval;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            costs of manufacturing commercial-grade products and necessary inventory to support commercial
                                            launch;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





| | ➢ | the
                                            ability to receive additional non-dilutive funding, including grants from organizations and
                                            foundations;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





| | ➢ | the
                                            revenue, if any, received from commercial sale of our products, should any of our current
                                            or future product candidates receive marketing approval;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            costs of preparing, filing and prosecuting patent applications, obtaining, maintaining, expanding
                                            and enforcing our intellectual property rights and defending intellectual property-related
                                            claims;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | our
                                            ability to establish and maintain collaborations on favorable terms, if at all; and
| | - | -----------------------------------------------------------------------------------------------------------------------------------



| | ➢ | the
                                            extent to which we acquire or in-license other product candidates and technologies.
| | - | -----------------------------------------------------------------------------------------------------------------------------------



Until such time, if ever, as we can generate
substantial product revenue, we expect to finance our operations through a combination of public or private equity offerings, debt financings,
governmental funding, collaborations, strategic partnerships and alliances or marketing, distribution or licensing arrangements with
third parties. To the extent that we raise additional capital through the sale of equity or convertible debt securities, your ownership
interest may be materially diluted, and the terms of such securities could include liquidation or other preferences that adversely affect
your rights as a common stockholder. Debt financing and preferred equity financing, if available, may involve agreements that include
restrictive covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital
expenditures or declaring dividends. In addition, debt financing would result in fixed payment obligations.



If we raise additional funds through governmental
funding, collaborations, strategic partnerships and alliances or marketing, distribution or licensing arrangements with third parties,
we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant
licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or other
arrangements when needed, we may be required to delay, limit, reduce or terminate our research, product development or future commercialization
efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.







49









Contractual obligations and other commitments



We do not have any material principal contractual
obligations and commitments as of December 31, 2021.



We enter into contracts in the normal course
of business with CROs, CMOs and other third parties for clinical trials, preclinical research studies and testing and manufacturing services.
These contracts are cancelable by us upon prior written notice. Payments due upon cancellation consist only of payments for services
provided or expenses incurred, including noncancelable obligations of our service providers, up to the date of cancellation. The amount
and timing of such payments are not known.



We have also entered into license and collaboration
agreements with third parties, which are in the normal course of business. We have not included future payments under these agreements
since obligations under these agreements are contingent upon future events such as our achievement of specified development, regulatory,
and commercial milestones, or royalties on net product sales.



Pursuant to the NXP800 License Agreement, we
are required to make payments to the ICR for certain development and regulatory milestones. As of December 31, 2021, we were obligated
to pay up to $23.0 million in milestone payments to the ICR related to pre-approval milestones, up to $178 million (in addition to the
$23.0 million) in regulatory and commercial sales milestones and mid-single digit to 10% royalties on a tiered basis on net sales. Additionally,
the Company will provide the ICR with up to an additional $0.5 million in research and development support.



Pursuant to the NXP900 License Agreement, we
are required to make payments to the UoE for certain development and regulatory milestones. At December 31, 2021, we were obligated
to make up to $46.0 million in milestone payments to the UoE related to pre-approval milestones including $0.5 million on the first anniversary
of the agreement, up to $279.5 million in regulatory and commercial sales milestones, mid-single digit to 8% royalties on a tiered basis
on net sales and 2.5% of the gross amount of each of the Company’s future fund raising up to a cumulative total of $3.0 million.
Additionally, the Company will provide UoE with up to an additional £580,000 in research and development support.



We do not currently have any long-term leases.
We rent our office space in Fort Lee, New Jersey based on a one-year agreement signed on May 3, 2021.



Critical Accounting Policies and Significant Judgments and Estimates



Our financial statements are prepared in accordance
with generally accepted accounting principles in the United States. The preparation of our financial statements and related disclosures
requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, costs and expenses. We base our
estimates on historical experience, known trends and events and various other factors that we believe are 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. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates
under different assumptions or conditions.





Stock-based compensation



We maintain an equity incentive plan as a long-term
incentive for employees, consultants and members of our board of directors. The plan allows for the issuance of non-statutory options,
or NSOs, and incentive stock options to employees and NSOs to nonemployees.





50







Stock-based compensation is measured using estimated
grant date fair value and recognized as compensation expense over the service period in which the awards are expected to vest. We estimate
the grant date fair value, and the resulting stock-based compensation, using the Black-Scholes option-pricing model, and we use the straight-line
method for expense attribution. The fair-value-based measurements of options granted to nonemployees are remeasured at each period end
until the options vest and are amortized to expense as earned. The valuation model used for calculating the estimated fair value of stock
awards is the Black-Scholes option-pricing model. The Black-Scholes model requires us to make assumptions and judgments about the variables
used in the calculations, including the expected term (weighted-average period of time that the options granted are expected to be outstanding),
the expected volatility of our common stock, the related risk-free interest rate and the expected dividend. We have elected to recognize
forfeitures of stock-based awards as they occur.



The Black-Scholes option-pricing model requires
the use of highly subjective assumptions to determine the fair value of stock-based awards. These assumptions include:



| | · | Expected
                                            Term—The expected term represents the weighted-average period the stock options are
                                            expected to remain outstanding and is based on the options’ vesting terms, contractual
                                            terms and industry peers, as we did not have sufficient historical information to develop
                                            reasonable expectations about future exercise patterns and post-vesting employment termination
                                            behavior.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Expected
                                            Volatility—Since we have been privately held and do not have any trading history for
                                            our common stock, the expected volatility is estimated based on the average volatility for
                                            comparable publicly traded biotechnology companies over a period equal to the expected term
                                            of the stock option grants. The comparable companies are chosen based on their similar size,
                                            stage in the life cycle or area of specialty.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Risk-Free
                                            Interest Rate—The risk-free interest rate is based on the U.S. Treasury zero coupon
                                            issues in effect at the time of grant for periods corresponding with the expected term of
                                            the option.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Expected
                                            Dividend—We have never paid dividends on our common stock and have no plans to pay
                                            dividends on our common stock. Therefore, we used an expected dividend yield of zero.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Income Taxes



In evaluating our valuation allowance, we consider
all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income,
tax planning strategies, and recent financial performance. Due to our lack of earnings history and uncertainties surrounding our ability
to generate future taxable income, the net deferred tax assets have been fully offset by a valuation allowance.



As of December 31, 2021, we had net operating
loss carryforwards for income tax purposes of approximately $9.3 million and all of the NOL does not expire.



Utilization of the net operating loss and credit
carryforwards may be subject to an annual limitation due to the ownership change limitations provided by Section 382 of the Internal
Revenue Code of 1986, as amended and similar state provisions.



While our significant accounting policies are
described in more detail in Note 2 to our financial statements appearing elsewhere in this report, we commenced our principal operations
in May 2021 and we believe that the accounting policies discussed are critical to understanding our historical and future performance
as these policies relate to the more significant areas involving management’s judgement and estimates.





51







Emerging Growth Company and Smaller Reporting Company Status



The Jumpstart Our Business Startups Act of 2012
permits an “emerging growth company” such as us to take advantage of an extended transition period to comply with new or
revised accounting standards applicable to public companies until those standards would otherwise apply to private companies. We have
elected to not “opt out” of this provision and, as a result, we will adopt new or revised accounting standards at the time
private companies adopt the new or revised accounting standard and will do so until such time that we either (i) irrevocably elect
to “opt out” of such extended transition period or (ii) no longer qualify as an emerging growth company.



We are also a “smaller reporting company”
meaning that the market value of our stock held by non-affiliates plus the proposed aggregate amount of gross proceeds to us as a result
of our initial public offering is less than $700 million and our annual revenue was less than $100 million during the most recently completed
fiscal year. We will continue to be a smaller reporting company for as long as either (i) the market value of our stock held by
non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed
fiscal year and the market value of our stock held by non-affiliates is less than $700 million. If we are a smaller reporting company
at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that
are available to smaller reporting companies. Specifically, as a smaller reporting company we may choose to present only the two most
recent fiscal years of audited financial statements in our Annual Report on Form 10-K and, similar to emerging growth companies,
smaller reporting companies have reduced disclosure obligations regarding executive compensation.





52









Item 7A.Quantitative
and Qualitative Disclosures About Market Risks



This disclosure is not applicable as we are a smaller reporting company.



Item 8.Financial
Statements and Supplementary Data



The information required by this Item is set forth in the financial
statements and notes thereto beginning at page F-1 of this Annual Report on Form 10-K.



Item 9.Changes
in and Disagreements with Accountants on Accounting and Financial Disclosure



None.



Item 9A.Controls
and Procedures



Evaluation of Disclosure Controls and Procedures



As of December 31,
2021, management carried out, under the supervision and with the participation of our principal executive officer and principal financial
officer, an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and
15d-15(e) under the Exchange Act). Our disclosure controls and procedures are designed to provide reasonable assurance that information
we are required to disclose in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in applicable rules and forms. Based upon that evaluation, our principal executive officer and
principal financial officer concluded that, as of December 31, 2021, our disclosure controls and procedures were effective.



Changes
in and Management’s Report on Internal Control over Financial Reporting.



This annual report does not include a report
of management's assessment regarding internal control over financial reporting or an attestation report of the company's registered public
accounting firm due to a transition period established by rules of the Securities and Exchange Commission for newly public companies.



We are not currently required to maintain an
effective system of internal controls over financial reporting as defined by Section 404 of SOX. We will be required to comply with
the internal control requirements of SOX as of the end of the first full fiscal year after becoming a public company. Only in the event
that we are deemed to be a large accelerated filer or an accelerated filer would we be required to comply with the independent registered
public accounting firm attestation requirement. Further, for as long as we remain an emerging growth company as defined in the JOBS Act,
we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that
are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public
accounting firm attestation requirement. Prior to this report, we have not completed a full assessment, nor has our independent registered
public accounting firm tested our systems, of internal controls. This annual report does not include
a report of management's assessment regarding internal control over financial reporting or an attestation report of the company's registered
public accounting firm due to a transition period established by rules of the Securities and Exchange Commission for newly public
companies.



Item
9B.Other Information



None.



Item 9C. Disclosure Regarding Foreign Jurisdictions
that Prevent Inspections



Not applicable.





53







PART III



| | Item 10. | Directors,
                                            Executive Officers and Corporate Governance
| | -------- | --------------------------------------------------------------------------------------------------



The following biographies set forth the names
of our current directors and executive officers, their ages, their positions with us, their principal occupations and employers, any
other directorships held by them during the past five years in companies that are subject to the reporting requirements of the Securities
Exchange Act of 1934 (the “Exchange Act”), or any company registered as an investment company under the Investment Company
Act of 1940, as well as additional information, all of which we believe sets forth each director nominee’s qualifications to serve
on the Board. There is no family relationship between and among any of our executive officers or directors.



The following table sets forth certain information about our directors
and executive officers.



|Name                  | ​ | ​ | Age | ​ | ​ | Position                                                               | ​
|--------------------- | - | - | --- | - | - | ---------------------------------------------------------------------- | -
|Ron
    Bentsur       | ​ | ​ | 56  | ​ | ​ | Chairman,
    Chief Executive Officer and President                    | ​
|Enrique Poradosu      | ​ | ​ | 56  | ​ | ​ | Executive Vice President,
    Chief Scientific and Business Officer    | ​
|Shay
    Shemesh      | ​ | ​ | 39  | ​ | ​ | Executive
    Vice President, Chief Development and Operations Officer | ​
|Michael Carson        | ​ | ​ | 46  | ​ | ​ | Vice President of Finance                                              | ​
|Kenneth
    Hoberman  | ​ | ​ | 57  | ​ | ​ | Director                                                               | ​
|Matthew Kaplan        | ​ | ​ | 54  | ​ | ​ | Director                                                               | ​
|James
    F. Oliviero | ​ | ​ | 46  | ​ | ​ | Director                                                               | ​



Executive Officers and Senior Management



Ron
Bentsur (56), Co-Founder, Chairman, Chief Executive Officer and President, has 20 years of senior leadership experience in
the biotechnology industry and has served as our Chief Executive Officer since our inception. He served as CEO of UroGen Pharma, Inc.
(NASDAQ: URGN) from August 2015 until January 2019, and as CEO of Keryx Biopharmaceuticals, Inc. (NASDAQ: KERX, acquired
by Akebia Therapeutics) from May 2009 until May 2015. At UroGen and Keryx, Mr. Bentsur led the clinical development, regulatory
approvals and the commercial infrastructure buildouts for the US commercial launches of Jelmyto and Auryxia, respectively. Mr. Bentsur
also led the establishment of a successful worldwide partnership for an earlier-stage program at UroGen and an ex-US development partnership
for Auryxia at Keryx. Mr. Bentsur served as CEO of XTL Biopharmaceuticals, Inc. (NASDAQ: XTLB) from January 2006 until
April 2009 and as Investor Relations and CFO of Keryx from October 2000 until January 2006. Mr. Bentsur worked as
an investment banker in NYC and Tel Aviv, Israel, from 1994 until 2000. Mr. Bentsur served as a member of the Board of Directors
of Stemline Therapeutics, Inc. from 2009 through the approval and launch of Elzonris® and through the subsequent acquisition
of the company by Menarini in June 2020, and serves on the Board of Directors of Beyond Air, Inc. (NASDAQ: XAIR). Mr. Bentsur
holds a BA in Economics and Business Administration with distinction from the Hebrew University of Jerusalem, Israel and an MBA
(Magna Cum Laude), from New York University’s Stern School of Business. Mr. Bentsur has been selected to serve on our
Board of Directors based on his years of experience in the biotechnology industry and extensive management experience.



Enrique
Poradosu, PhD (56), Co-Founder, Executive Vice President, Chief Scientific and Business Officer, has 20 years of senior scientific
leadership experience in the biotechnology industry and has served as our Executive Vice President, Chief Scientific and Business Officer
since our inception. From January 2016 until December 2020, he served as SVP, Business and Scientific Strategy at Stemline
Therapeutics, Inc. (NASDAQ: STML, acquired by Menarini in June 2020). At Stemline Dr. Poradosu led the licensing and scientific
strategy of the company’s pipeline, as well as directly leading strategic planning and operational execution of the early-stage
drug development programs. Prior to that, Dr. Poradosu served as VP Business and Scientific Strategy at Keryx Biopharmaceuticals, Inc.
(NASDAQ: KERX), acquired by Akebia Therapeutics (NASDAQ: AKBA)), from 2003 until 2016. From 1998 until 2003, Dr. Poradosu served
as a project manager at a private biomedical incubator. Dr. Poradosu holds a BSc in Chemistry and Biology with distinction from
the Hebrew University of Jerusalem, Israel and a PhD in Biochemistry, from the Hebrew University of Jerusalem.





54









Shay
Shemesh (39), Co-Founder, Executive Vice President, Chief Development and Operations Officer, has 14 years of multi-disciplinary
experience in drug development and has served as our Executive Vice President and Chief Development Officer since our inception. From
2015 until 2020, he served as SVP, Clinical and Regulatory Affairs at Stemline Therapeutics, Inc. (NASDAQ: STML, acquired by Menarini
in June 2020) where he led multi-disciplinary development teams in early and late-stage projects. In this role, Mr. Shemesh
held responsibilities for the strategic planning and operational execution of the Elzonris®
Biologics License Application, with the FDA and Marketing Authorization Application with EMA, resulting in the approval of ElzonrisTM
in both regions for the treatment of blastic plasmacytoid dendritic cell neoplasm, an orphan hematologic malignancy. Prior to that, Mr. Shemesh
was a clinical operations lead at Keryx Biopharmaceuticals (NASDAQ: KERX, acquired by Akebia Therapeutics (NASDAQ: AKBA)), where he managed
the late-stage clinical trials for AuryxiaTM for the treatment of anemia in patients with non-dialysis CKD, which led to the approval
of Auryxia in this indication in the US and the EU. Mr. Shemesh holds a BSc and MSc in Biotechnology from Bar Ilan University in
Israel.



Michael
Carson (46), Vice President of Finance, has over 20 years of broad experience in corporate finance, accounting, and operations.
He specializes in clinical stage biopharmaceutical and biotechnology companies. From late 2019 until 2021, he served as Vice President
of Finance at XyloCor Theraputics, Inc. where he led the accounting, treasury and finance functions. During 2019, Mr. Carson
consulted for Smiths Medical, Inc., a division of Smiths Group, as Global Controller along with serving as Vice President of Finance
in a consulting role for several other biopharmaceutical and medical device companies. At Smiths Medical, he led a team responsible for
accounting, treasury and foreign currency exposure. From 2015 to 2019 he served as Director of Financial Planning and Analysis at Neuronetics
(NASDAQ: STIM). In this role, Mr. Carson served as the second in command to the Chief Financial Officer and held responsibilities
for strategic planning, financial execution, investor relations, and controllership. In the past, he has held several finance and accounting
positions at Abbott Laboratories (NYSE: ABT) and served as an auditor at Crowe LLP and Deloitte. Mr. Carson holds a Bachelor of
Arts in Business and Economics along with a Bachelor of Science in Mechanical Engineering from Lafayette College in Pennsylvania. He
is a licensed Certified Public Accountant in the Commonwealth of Pennsylvania.



Non-Employee Directors



Kenneth
Hoberman (57), Director, joined our Board of Directors in July 2021. Mr. Hoberman has extensive financial, investor
relations, corporate governance, operational, and business development experience including M&A, strategic alliances and partnerships
both domestic and international. Mr. Hoberman has served as the Chief Operating Officer of Stemline Therapeutics, Inc. (“Stemline”)
since 2013, where he negotiated and closed several licensing agreements and was responsible for multiple vendor contracts. While at Stemline,
he helped lead the company from an early-stage drug development company to a fully integrated commercial entity, including through Stemline’s
successful initial public offering. Mr. Hoberman directed all Stemline’s functional groups, including manufacturing, commercial,
regulatory, R&D, medical affairs, public and investor relations, HR and finance. Mr. Hoberman also led the M&A transaction
which resulted in the sale of Stemline to the Menarini Group in June 2020 for approximately $750 million. He was previously Vice
President of Corporate and Business Development of Keryx Biopharmaceuticals, Inc., where he initiated and executed a Japanese partnership
valued at up to $100 million, and originated, negotiated and closed dozens of licensing and operational contracts, including the licensing
of AuryxiaTM, which was approved by the FDA in September 2014. He is on the Board of Directors of TG Therapeutics, Inc.
(Nasdaq: TGTX). He received a B.S.B.A. in Finance from Boston University and completed post-baccalaureate studies at Columbia University.
Mr. Hoberman has been selected to serve on our Board of Directors based on his extensive experience in the biopharmaceutical industry
and in-depth understanding of our business.





55







Matthew
L. Kaplan (54), Director, joined our Board of Directors in September 2021. Mr. Kaplan is an experienced Equity Analyst
with deep knowledge in biotechnology, particularly for analysis and advisement of early-stage companies. With 24 years of experience
as an Equity Analyst, since 2008, he has been a Managing Director and the Head of Healthcare Equity Research at Ladenburg Thalmann &
Co. Prior to joining Ladenburg Thalmann & Co., he was a Partner and the Director of Healthcare Research with Punk, Ziegel &
Company, a Senior Biotechnology Analyst at Evolution Capital, and a Director of The Life Sciences Group at The Carson Group. Mr. Kaplan
has received numerous citations as a top ranked Biotechnology Stock Picker by Thomson Reuters, The Financial Times, and Forbes. Mr. Kaplan
also spent six years as a Research Associate with the Albert Einstein College of Medicine / Montefiore Hospital Department of Cardiology,
where he co-authored numerous articles on gene regulation in the heart. Mr. Kaplan received his BS in Biology from the University
of Michigan.



James
F. Oliviero, III (46), Director, joined our Board of Directors in July 2021. Mr. Oliviero has over twenty years
of operational experience in the biotechnology industry. Since 2015, Mr. Oliviero has served as the President and Chief Executive
Officer of Checkpoint Therapeutics, Inc. (NASDAQ: CKPT), where he has completed over $100 million in private and public financings
for the company to date, while designing and overseeing the company’s development programs for its novel immuno-oncology and targeted
therapy product candidates being evaluated for the treatment of several solid tumor cancer indications. Prior to Checkpoint, from May 2003
to September 2015, Mr. Oliviero served in a variety of leadership capacities at Keryx Biopharmaceuticals, Inc., which
was subsequently acquired by Akebia. His most recent position at Keryx, beginning in April 2009, was as Chief Financial Officer,
responsible for all of the finance, accounting, investor relations, corporate governance and legal matters and was also involved in the
clinical and regulatory development of Auryxia®, which successfully obtained FDA approval in
2014. From August 1999 to May 2003, Mr. Oliviero was Director of Finance for ACCESS Oncology, Inc., a privately held
biotechnology company. Mr. Oliviero began his professional career as an investment banker at Furman Selz LLC in New York City. Mr. Oliviero
is a CFA charterholder and holds a B.B.A. in Finance with Highest Distinction from Emory University’s Goizueta Business School.
Mr. Oliviero has been selected to serve on our Board of Directors based on his extensive experience in the biotechnology industry
and in-depth understanding of our business.



Election of Officers and Family Relationships



Our executive officers are appointed by, and
serve at the discretion of, our board of directors. There are no family relationships among any of our directors or executive officers.



Board Composition



Our bylaws provide that our board of directors
shall consist of between one and nine directors, which number shall be fixed from time to time by resolution of our board of directors.
Currently our board of directors consists of Ron Bentsur, Kenneth Hoberman, James Oliviero, and Matthew Kaplan.



Our bylaws also provide that our directors may
be removed with or without cause by the affirmative vote of the holders of at least two-thirds of the votes that all our stockholders
would be entitled to cast in an annual election of directors.



Our current and future executive officers and
significant employees serve at the discretion of our Board. Our Board may also choose to form certain committees, such as a compensation
committee and an audit committee.



Director Independence



Our board of directors has determined that Kenneth
Hoberman, Matthew Kaplan and James Oliviero are independent directors. In making this determination, our board of directors applied the
standards set forth in the rules of Nasdaq and in Rule 10A-3 under the Exchange Act. Our board of directors considered all
relevant facts and circumstances known to it in evaluating the independence of these directors, including their current and historical
employment, any compensation we have given to them, any transactions we have with them, their beneficial ownership of our capital stock,
their ability to exert control over us, all other material relationships they have had with us and the same facts with respect to their
immediate families.



Although there is no specific policy regarding
diversity in identifying director nominees, the board of directors seek the talents and backgrounds that would be most helpful to us
in selecting director nominees.



56









Board Leadership Structure



Mr. Ron Bentsur, our Chief Executive Officer,
is also the Chairman of our board of directors. Our corporate governance guidelines provide our board of directors with flexibility to
select the appropriate leadership structure at a particular time based on what our board of directors determines to be in the best interests
of the Company. Our board of directors determined that, at the present time, having our Chief Executive Officer also serve as the Chairman
of our board of directors provides us with optimally effective leadership and is in our best interests and those of our stockholders.
Twenty years of management experience in our industry as well as his extensive understanding of our business, operations, and strategy
make him well qualified to serve as chairman of our board.



Board Oversight of Risk



Risk assessment and oversight are an integral
part of our governance and management processes. Our board of directors encourages management to promote a culture that incorporates
risk management into our corporate strategy and day-to-day business operations. Management discusses strategic and operational risks
at regular management meetings and conducts specific strategic planning and review sessions during the year that include a focused discussion
and analysis of the risks facing us. Throughout the year, senior management reviews these risks with the board of directors at regular
board meetings as part of management presentations that focus on particular business functions, operations or strategies, and presents
the steps taken by management to mitigate or eliminate such risks.



Our board of directors does not have a standing
risk management committee, but rather administers this oversight function directly through our board of directors as a whole, as well
as through various standing committees of our board of directors that address risks inherent in their respective areas of oversight.
In particular, our board of directors is responsible for monitoring and assessing strategic risk exposure. Our audit committee is responsible
for coordinating the board of director’s oversight of our internal control over financial reporting, disclosure controls and procedures,
related-party transactions and code of conduct and corporate governance guidelines. Our compensation committee is responsible for assessing
and monitoring whether any of our compensation policies and programs has the potential to encourage excessive risk-taking as well as
succession planning as it relates to our Chief Executive Officer. While each committee is responsible for evaluating certain risks and
overseeing the management of such risks, our entire board of directors will be regularly informed through committee reports about such
risks.



Board Committees



Our board of directors has established an audit
committee and compensation committee, each of which operates pursuant to a charter adopted by our board of directors. Our board of directors
may also establish other committees from time to time to assist the management of our business. The composition and functions of each
committee are described below. Members serve on these committees until their resignation or until otherwise determined by our board of
directors. Each committee already established has adopted a written charter that will satisfy the applicable rules and regulations
of the Sarbanes-Oxley Act, the SEC and Nasdaq Listing Rules, which is available on our website at www.nuvectis.com.



Audit Committee



Our audit committee consists of Kenneth Hoberman,
Matthew Kaplan and James Oliviero, with James Oliviero serving as chair. Our board of directors has determined that each member of the
audit committee has sufficient knowledge in financial and auditing matters to serve on the Audit Committee. Our board of directors has
determined James Oliviero qualifies as an “audit committee financial expert,” as defined under the applicable rules of
the SEC. In making this determination, our board has considered prior experience, business acumen and independence. The audit committee’s
responsibilities include:





57







| | ➢ | evaluating
                                            the performance, independence and qualifications of our independent auditors and determining
                                            whether to retain our existing independent auditors or engage new independent auditors;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | reviewing
                                            and approving the engagement of our independent auditors to perform audit services and any
                                            permissible non-audit services;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | monitoring
                                            the rotation of partners of our independent auditors on our engagement team as required by
                                            law;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | prior
                                            to engagement of any independent auditor, and at least annually thereafter, reviewing relationships
                                            that may reasonably be thought to bear on their independence, and assessing and otherwise
                                            taking the appropriate action to oversee the independence of our independent auditor;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | reviewing
                                            our annual and quarterly financial statements and reports, including the disclosures contained
                                            under the caption “Management’s Discussion and Analysis of Financial Condition
                                            and Results of Operations,” and discussing the statements and reports with our independent
                                            auditors and management;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | reviewing,
                                            with our independent auditors and management, significant issues that arise regarding accounting
                                            principles and financial statement presentation and matters concerning the scope, adequacy
                                            and effectiveness of our financial controls;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | reviewing
                                            with management and our independent auditors any earnings announcements and other public
                                            announcements regarding material developments;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | establishing
                                            procedures for the receipt, retention and treatment of complaints received by us regarding
                                            financial controls, accounting or auditing matters and other matters;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





| | ➢ | preparing
                                            the report that the SEC requires in our annual proxy statement;
| | - | ---------------------------------------------------------------------------------------------------------------------



| | ➢ | reviewing
                                            and providing oversight of any related-person transactions in accordance with our related-person
                                            transaction policy and reviewing and monitoring compliance with legal and regulatory responsibilities,
                                            including our code of business conduct and ethics;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | reviewing
                                            our major financial risk exposures, including the guidelines and policies to govern the process
                                            by which risk assessment and risk management are implemented;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | reviewing
                                            on a periodic basis our investment policy; and
| | - | ----------------------------------------------------------------------------------------------------



| | ➢ | reviewing
                                            and evaluating on an annual basis the performance of the audit committee and the audit committee
                                            charter.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Compensation Committee



Our compensation committee consists of Kenneth
Hoberman, Matthew Kaplan and James Oliviero, with Kenneth Hoberman serving as chair. Our board of directors has determined that each
of the members of our compensation committee is a non-employee director, as defined in Rule 16b-3 promulgated under the Exchange
Act, and satisfies the Nasdaq independence requirements. The functions of this committee include, among other things:



| | ➢ | reviewing
                                            and approving our philosophy, policies and plans with respect to the compensation of our
                                            chief executive officer;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | making
                                            recommendations to our board of directors with respect to the compensation of our chief executive
                                            officer and our other executive officers;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | reviewing
                                            and assessing the independence of compensation advisors;
| | - | --------------------------------------------------------------------------------------------------------------



| | ➢ | overseeing
                                            and administering our equity incentive plans;
| | - | ----------------------------------------------------------------------------------------------------





| | ➢ | reviewing
                                            and making recommendations to our board of directors with respect to director compensation;
                                            and
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | preparing
                                            the Compensation Committee reports required by the SEC, including our “Compensation
                                            Discussion and Analysis” disclosure.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





58









We believe that the composition and functioning
of our compensation committee complies with all applicable requirements of the Sarbanes-Oxley Act, and all applicable SEC and Nasdaq
rules and regulations. We intend to comply with future requirements to the extent they become applicable to us.



Nominating and Corporate Governance Matters



Our board of directors does not currently have
a nominating and corporate governance committee or other committee performing a similar function, nor do we have any formal written policies
outlining the factors and process relating to the selection of nominees for consideration for membership on our board of directors by
our directors or our stockholders. Our board of directors has adopted resolutions in accordance with the rules of The Nasdaq Stock
Market authorizing a majority of our independent members to recommend qualified director nominees for consideration by the board of directors.
Our board of directors believes that it is appropriate for us to not have a standing nominating and corporate governance committee because
of a number of factors, including the number of independent members who want to participate in consideration of candidates for membership
on our board of directors and in matters that relate to the corporate governance of our company. Our board of directors consists of four
members, three of whom are independent. Our board of directors considered forming a nominating and corporate governance committee consisting
of several of the independent members of our board of directors. Forming a committee consisting of less than all of the independent members
was unattractive because it would have omitted the other independent members of our board of directors who wanted to participate in considering
qualified candidates for board membership and to have input on corporate governance matters related to our company. Since our board of
directors desired the participation in the nominations process of all of its independent directors, it therefore decided not to form
a nominating and corporate governance committee and instead authorized a majority of the independent members of our board of directors
to make and consider nominations for membership to our board of directors. The independent members of our board of directors do not have
a nominating and corporate governance committee charter, but act pursuant to board of director resolutions as described above. Each of
the members of our board of directors authorized to recommend director nominees is independent within the meaning of the current “independent
director” standards established by The Nasdaq Stock Market rules. Our board of directors intends to review this matter periodically,
and may in the future elect to designate a formal nominating and corporate governance committee.



Code of Business Conduct and Ethics



We
have adopted a written code of business conduct, that applies to our directors, officers and employees, including our principal executive
officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of
the code is available on our website atwww.nuvectis.com.



Delinquent Section 16(a) Reports



Section 16(a) of the Exchange Act requires
our directors, executive officers and persons who own more than 10% of the shares of our common stock to file an initial report of ownership
on Form 3 and changes in ownership on Form 4 or Form 5 with the SEC. Such officers, directors and 10% stockholders are
also required by SEC rules to furnish us with copies of any Forms 3, 4 or 5 that they file. The SEC rules require us to disclose
late filings of initial reports of stock ownership and changes in stock ownership by our directors, executive officers and 10% stockholders.
Based solely on a review of copies of the Forms 3, 4 and 5 furnished to us by reporting persons and any written representations furnished
by certain reporting persons, we believe that during the fiscal year ended December 31, 2021, all Section 16(a) filing
requirements applicable to our directors, executive officers and 10% stockholders were completed in a timely manner.





59







| | Item 11. | Executive
                                            Compensation
| | -------- | ------------------------------------------------------------------



Summary Compensation Table



The following table sets forth information concerning compensation
paid by us to the executive officers named below, collectively referred to as “Named Executive Officers” elsewhere in this
report, for their services rendered to us in all capacities during the year ended December 31, 2021.



|Name and Principal Position                            |  | Year |      |  | Salary ($) |  |        | Bonus |  |  | Stock
                                            Awards(1) ($) |  |  | All
                                            Other 
                                            Compensation ($) |         |     | Total ($) | 
|------------------------------------------------------ |  | ---- | ---- |  | ---------- |  | ------ | ----- |  |  | --------------------------------------------------------------- |  |  | ------------------------------------------------------------------------------------------------------------------- | ------- | --- | --------- | 
|Ron Bentsur, Chairman & CEO                            |  |      | 2021 |  |            |  | --     |       |  |  | --                                                              |  |  |                                                                                                                     | 384,018 | (2) |           | 
|Enrique Poradosu, Chief Scientific & Business Officer  |  |      | 2021 |  |            |  | 27,083 |       |  |  | --                                                              |  |  |                                                                                                                     | 192,056 | (2) |           | 
|Shay Shemesh, Chief Development and Operations Officer |  |      | 2021 |  |            |  | 27,083 |       |  |  | --                                                              |  |  |                                                                                                                     | 192,056 | (2) |           | 
|Uri Ben-Or, Former Interim Chief Financial
    Officer |  |      | 2021 |  |            |  | 25,000 |       |  |  | --                                                              |  |  |                                                                                                                     | 58,384  | (3) |           | 



(1) Reflects
the aggregate grant date fair value of restricted stock granted during the fiscal year calculated in accordance with FASBASC
Topic 718. The grant date fair value of the stock awards is based on the fair market value of the underlying shares on the date of grant
and does not take into account any estimated forfeitures. The grant date fair value of the stock awards also does not take into account
any stock awards which vest upon certain corporate milestones when the “measurement date” for accounting purposes for such
awards has not yet occurred and the fair value is uncertain. For such awards, stock-based compensation is measured and recorded if and
when a milestone occurs, and the compensation for such awards are reflected in the table in such year the compensation is recorded.

(2) Reflects value of restricted stock awards
vesting on July 27, 2022 and value of fully vested stock awarded in May 2021.

(3) Reflects value of shares of fully vested
stock awarded in May 2021. Mr. Ben-Or's engagement with Nuvectis was mutually terminated on March 21, 2022.



Narrative to Summary Compensation Table



Overview



The following are our employment arrangements with our executive officers:



Ron Bentsur



Annual Base Salary



As of February 4, 2022 (the “Effective
Date”), Mr. Bentsur’s annual base salary is $575,000 per annum, paid monthly in equal installments. On an annual basis,
the amount of Mr. Bentsur’s salary shall be increased by no less than the greater of (1) the amount determined by the
Company’s Compensation Committee, or (2) the relevant consumer price index (“CPI”). Mr. Bentsur did not receive
any cash compensation in 2021.



Annual Bonus



Mr. Bentsur’s annual bonus target
will be 75% of his annual base salary, based on the achievement of corporate goals & objectives, paid no later than March 15
following such bonus performance calendar year period. The Board or Compensation Committee shall have the discretion to pay Mr. Bentsur
an annual performance bonus in excess of the target for performance exceeding goals, which bonus may be awarded without proration in
the event of a partial contract year.





60







Equity Awards



Mr. Bentsur will be eligible for grants
of equity awards under the Company’s long-term equity incentive plan. On the Effective Date, the Company shall award the following
to the Mr. Bentsur:





| | (i) | restricted shares of common stock upon the
                                            consummation of the earlier of (a) initial public offering (“IPO”) raising
                                            at least $15 million in gross proceeds, or (b) capital raising of at least $15 million
                                            in a private equity financing, equal to 1% of the fully-diluted share count immediately preceding
                                            such IPO/financing event, which restricted shares will vest and become fully exercisable
                                            on the first anniversary of the offering or financing event, which milestone was met on July 27,
                                            2021 in connection with the closing of the $15.3 million Preferred A round and Mr. Bentsur
                                            was granted 96,759 shares of restricted stock; and
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | fully vested shares of common stock equal
                                            to 1% of the then fully diluted share count of the Company when the Company reaches an average
                                            market capitalization over a 30-day period of $350 million or higher.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Termination Provisions



In the event that Mr. Bentsur is terminated
without Cause, for Good Reason, Change of Control, Death or Disability, as each such term is defined in Mr. Bentsur’s employment
agreement, all unvested shares of restricted stock and options shall be immediately accelerated and become fully vested and unrestricted/​exercisable.
Upon termination for Cause, all unvested shares of restricted shock shall expire and terminate.



If Mr. Bentsur resigns for Good Reason or
is terminated due to Death or Disability, Change of Control, or otherwise terminated without Cause, then Mr. Bentsur or his estate
or beneficiaries, in the case of Death or Disability, will receive a one-time payment equal to two years of Mr. Bentsur’s
then annual base salary, plus a bonus payment equal to the annual bonus earned in the preceding year (if not already paid), the pro rata
portion of the target bonus earned in the current year, benefits and expense reimbursement due to Mr. Bentsur, payment in lieu of
any accrued but unused vacation time, payment of any unreimbursed expenses, and continued coverage through the longest applicable limitations
period under the Company’s directors and officers insurance policies, all such payments to be made within 60 (sixty) days of the
date of termination.



Notwithstanding the above the Company may terminate
Mr. Bentsur’s employment hereunder at any time, immediately, for Cause, upon written notice to Mr. Bentsur. If Mr. Bentsur’s
employment is terminated for Cause, he shall be entitled to receive (i) the unpaid portion of his base salary then in effect accrued
through the effective date of the termination of his employment hereunder, and (ii) payment for any unused vacation days which have
accrued through the effective date of the termination of Mr. Bentsur’s employment, in each case to be paid within 30 (thirty)
days after such effective date.



In the event that a “Transaction”
 ​(as such term is defined in the Company’s Global Equity Incentive Plan, as amended from time to time, or a successor plan)
occurs during Mr. Bentsur’s employment, regardless of whether Mr. Bentsur’s employment is terminated, Mr. Bentsur
shall receive payment of the termination benefits described above as if his employment had been terminated on the effective date of the
Transaction. Following the Transaction, Mr. Bentsur shall not be entitled to receive such termination benefits upon a future termination
of his employment; provided that he shall remain eligible to receive (i) any accrued benefits upon any such subsequent termination,
and (ii) cash payments, paid in periodic installments in accordance with the Company’s usual payroll practices, for a period
of 18 months, equal to the cost the Company would have incurred had Mr. Bentsur continued group medical, dental, vision and/or prescription
drug benefit coverage for himself and/or his eligible dependents under any Company sponsored group health plan covering Mr. Bentsur
and his eligible dependents at the time of the termination of employment.





61







Enrique Poradosu



Annual Base Salary



As of February 4, 2022, Mr. Poradosu’s
annual base salary is $400,000 per annum, paid monthly in equal installments. On an annual basis, the amount of Mr. Poradosu’s
salary shall be increased by no less than the greater of (1) the amount determined by the Company’s Compensation Committee,
or (2) the relevant CPI.



In 2021, Mr. Poradosu received cash compensation
of $27,083.



Annual Bonus



Mr. Poradosu’s annual bonus target
shall be 50% of the annual base salary, based on the achievement of corporate goals & objectives, paid no later than March 15
following such bonus performance calendar year period. The Board or Compensation Committee shall have the discretion to pay Mr. Poradosu
an annual performance bonus in excess of the target for performance exceeding goals, which bonus may be awarded without proration in
the event of a partial contract year.



Equity Awards



Mr. Poradosu will be eligible for grants
of equity awards under the Company’s long-term equity incentive plan. On the Effective Date, the Company shall award the following
to the Mr. Poradosu:



| | (i) | restricted shares of common stock upon the
                                            consummation of the earlier of (a) IPO raising at least $15 million in gross proceeds,
                                            or (b) capital raising of at least $15 million in a private equity financing, equal
                                            to 0.5% of the fully-diluted share count immediately preceding such IPO/financing event,
                                            which restricted shares will vest and become fully exercisable on the first anniversary of
                                            the offering or financing event, which milestone was met on July 27, 2021 in connection
                                            with the closing of the $15.3 million Preferred A round and Mr. Poradosu was granted
                                            48,399 shares of restricted stock; and
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | fully vested shares of common stock equal
                                            to 0.5% of the then fully diluted share count of the Company when the Company reaches an
                                            average market capitalization over a 30-day period of $350 million or higher.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Termination Provisions



In the event that Mr. Poradosu’s is
terminated without Cause, for Good Reason, Change of Control, Death or Disability (as such terms are defined in Mr. Poradosu’s
employment agreement) all unvested shares of restricted stock and options shall be immediately accelerated and become fully vested and
unrestricted/​exercisable. Upon termination for Cause, all unvested shares of restricted shock shall expire and terminate.



If Mr. Poradosu resigns for Good Reason
or is terminated due to Death or Disability, Change of Control, or otherwise terminated without Cause, Mr. Poradosu or his estate
or beneficiaries, in the case of Death or Disability, will receive a one-time payment equal to two years of Mr. Poradosu’s
then annual Base Salary, plus a bonus payment equal to Mr. Poradosu’s annual bonus earned in the preceding year if not already
paid, the pro rata portion of the target bonus earned in the current year, benefits and expense reimbursement due to Mr. Poradosu,
payment in lieu of any accrued but unused vacation time, payment of any unreimbursed expenses, and continued coverage through the longest
applicable limitations period under the Company’s directors and officers insurance policies, all such payments to be made within
60 (sixty) days of the date of termination.



Notwithstanding the above the Company may terminate
Mr. Poradosu’s employment hereunder at any time, immediately, for Cause, upon written notice to Mr. Poradosu. If Mr. Poradosu’s
employment is terminated for Cause, he shall be entitled to receive (i) the unpaid portion of his base salary then in effect accrued
through the effective date of the termination of his employment hereunder, and (ii) payment for any unused vacation days which have
accrued through the effective date of the termination of his employment, in each case to be paid within 30 (thirty) days after such effective
date.





62







In the event that a “Transaction”
 ​(as such term is defined in the Company’s Global Equity Incentive Plan, as amended from time to time, or a successor plan)
occurs during Mr. Poradosu’s employment, regardless of whether Mr. Poradosu’s employment is terminated, Mr. Poradosu
shall receive payment of the termination benefits described above as if his employment had been terminated on the effective date of the
Transaction. Following the Transaction, Mr. Poradosu shall not be entitled to receive such termination benefits upon a future termination
of his employment; provided that he shall remain eligible to receive (i) any accrued benefits upon any such subsequent termination,
and (ii) cash payments, paid in periodic installments in accordance with the Company’s usual payroll practices for a period
of 18 months, equal to the cost the Company would have incurred had Mr. Poradosu continued group medical, dental, vision and/or
prescription drug benefit coverage for himself and/or his eligible dependents under any Company sponsored group health plan covering
Mr. Poradosu and his eligible dependents at the time of the termination of employment.



Shay Shemesh



Annual Base Salary



As of February 4, 2022, Mr. Shemesh’s
annual base salary is $400,000 per annum, paid monthly in equal installments. On an annual basis, the amount of the Mr. Shemesh’s
Salary shall be increased by no less than the greater of (1) the amount determined by the Company’s Compensation Committee,
or (2) the relevant CPI.



In 2021, Mr. Shemesh received cash compensation
of $27,083.



Annual Bonus



Mr. Shemesh’s annual bonus target
will be 50% of his annual base salary, based on the achievement of corporate goals & objectives, paid no later than March 15
following such bonus performance calendar year period. The Board or Compensation Committee shall have the discretion to pay the Mr. Shemesh
an annual performance bonus in excess of the target for performance exceeding goals, which bonus may be awarded without proration in
the event of a partial contract year.



Equity Awards



Mr. Shemesh will be eligible for grants
of equity awards under the Company’s long-term equity incentive plan. On the Effective Date, the Company shall award the following
to the Mr. Shemesh:



| | (i) | restricted shares of common stock upon the
                                            consummation of the earlier of (a) IPO raising at least $15 million in gross proceeds,
                                            or (b) capital raising of at least $15 million in a private equity financing, equal
                                            to 0.5% of the fully-diluted share count immediately preceding such IPO/financing event,
                                            which restricted shares will vest and become fully exercisable on the first anniversary of
                                            the offering or financing event, which milestone was met on July 27, 2021 in connection
                                            with the closing of the $15.3 million Preferred A round and Mr. Shemesh was granted
                                            48,399 shares of restricted stock; and
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





| | (ii) | fully vested shares of common stock equal
                                            to 0.5% of the then fully diluted share count of the Company when the Company reaches an
                                            average market capitalization over a 30-day period of $350 million or higher.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Termination Provisions



In the event that Mr. Shemesh is terminated
without Cause, for Good Reason, Change of Control, Death or Disability (as such terms are defined in the employment agreement) all unvested
shares of restricted stock and options shall be immediately accelerated and become fully vested and unrestricted/exercisable. Upon termination
for Cause, all unvested shares of restricted shock shall expire and terminate.





63







If Mr. Shemesh resigns for Good Reason or
is terminated due to Death or Disability, Change of Control, or otherwise terminated without Cause, then Mr. Shemesh or his estate
or beneficiaries, in the case of Death or Disability, will receive a one-time payment equal to two years of Mr. Shemesh’s
then annual Base Salary, plus a bonus payment equal to the annual bonus earned in the preceding year if not already paid, the pro rata
portion of the target bonus earned in the current year, plus benefits and expense reimbursement due to Mr. Shemesh, payment in lieu
of any accrued but unused vacation time, payment of any unreimbursed expenses, and continued coverage through the longest applicable
limitations period under the Company’s directors and officers insurance policies, all such payments to be made within 60 (sixty)
days of the date of termination.



Notwithstanding the above the Company may terminate
Mr. Shemesh’s employment hereunder at any time, immediately, for Cause, upon written notice to Mr. Shemesh. If Mr. Shemesh’s
employment is terminated for Cause, he shall be entitled to receive (i) the unpaid portion of his base salary then in effect accrued
through the effective date of the termination of his employment hereunder, and (ii) payment for any unused vacation days which have
accrued through the effective date of the termination of his employment, in each case to be paid within 30 (thirty) days after such effective
date.



In the event that a “Transaction”
 ​(as such term is defined in the Company’s Global Equity Incentive Plan, as amended from time to time, or a successor plan)
occurs during Mr. Shemesh’s employment, regardless of whether Mr. Shemesh’s employment is terminated, Mr. Shemesh
shall receive payment of the termination benefits described above as if his employment had been terminated on the effective date of the
Transaction. Following the Transaction, Mr. Shemesh shall not be entitled to receive such termination benefits upon a future termination
of his employment; provided that he shall remain eligible to receive (i) any accrued benefits upon any such subsequent termination
and (ii) cash payments, paid in periodic installments in accordance with the Company’s usual payroll practices for a period
of 18 months, equal to the cost the Company would have incurred had Mr. Shemesh continued group medical, dental, vision and/or prescription
drug benefit coverage for himself and/or his eligible dependents under any Company sponsored group health plan covering Mr. Shemesh
and his eligible dependents at the time of the termination of employment.



Uri Ben-Or



Contract Agreement



Mr. Ben-Or’s engagement with us mutually
terminated as of March 21, 2022. In connection with the engagement, the Company paid Mr. Ben-Or $109,000 comprised of $100,000
in connection with the IPO, of which $25,000 was paid in 2021, and an additional $9,000 paid for services provided after the IPO.



Equity Awards



Mr. Ben-Or has received 25,584 fully vested
shares of common stock.



Employee Benefit and Incentive Plans



We do not maintain any deferred compensation,
retirement, pension or profit-sharing plans. Our Board of Directors has adopted an incentive plan, the material terms of which are described
below, allowing for the grant of equity and cash-based awards to our employees and directors.



Outstanding Equity Awards as of December 31,
2021



Since our inception through December 31,
2021, we granted 100,893 warrants to service providers with an exercise price of $3.05. All of these warrants are now fully vested. On
August 20, 2021 we granted 138,840 options to service providers, all with 3-year vesting period. Since inception through December 31,
2021, we also issued 4,699,071 shares of common stock to our three co-founders, and two additional individuals, including Mr. Uri-Ben-Or,
our former interim-CFO.



The following table sets forth certain information
concerning option awards and stock awards held by our Named Executive Officers as of December 31, 2021.





64







|Name             |  | Number
                                            of Shares
                                            that Have Not Vested (#) |        |     | Market
                                            Value of Shares
                                            that Have Not Vested(1) ($) | 
|---------------- |  | --------------------------------------------------------------------------------------------------------------------------------- | ------ | --- | ------------------------------------------------------------------------------------------------------------------------------------------ | 
|Ron Bentsur      |  |                                                                                                                                   | 96,759 | (2) |                                                                                                                                            | 
|Enrique Poradosu |  |                                                                                                                                   | 48,399 | (2) |                                                                                                                                            | 
|Shay Shemesh     |  |                                                                                                                                   | 48,399 | (2) |                                                                                                                                            | 



(1) Market value is based on $7.63 per share, the closing price
of our common stock on the Nasdaq Capital Market on March 17, 2022.

(2) Reflects restricted stock awards granted upon the completion
of a $15.3 million financing round that will vest on July 27, 2022.



Director Compensation



None of our directors received any compensation
during the year ended December 31, 2021 for services rendered to us. Upon the completion of our initial public offering, which occurred
on February 8, 2022, our directors will be compensated pursuant to our Global Equity Incentive Plan (2021). Our directors will receive
an annual cash retainer of $40,000, payable in quarterly installments on the last day of each calendar quarter, with prorated payment
for any partial quarters. Each member of the Compensation Committee and Audit Committee will also receive an additional $5,000 annual
fee for membership on each committee, with the Chairs of the Audit and Compensation Committees to receive $7,500, payable in quarterly
installments on the last day of each calendar quarter, with prorated payment for any partial quarters. Directors also received (i) an
initial equity grant of 29,250 options to purchase our Common Stock, with an exercise price of $3.05 per option and will receive (ii) annual
option grants with an estimated value of approximately $150,000, with the first of such grants to occur only upon the first Board meeting
following the consummation of the Company's initial public offering. All option grants will vest in 3 years, with 1/3 of the granted
options of each grant vesting on the first, second and third anniversaries of the date of such grant. respectively. The Board will have
full discretion with respect to the annual grants.



Compensation Committee Interlocks and Insider
Participation



None of our current or former executive officers
serve as a member of the compensation committee. None of our officers serve, or have served during the last completed fiscal year, on
the board of directors or compensation committee, or other committee serving an equivalent function, of any other entity that has one
or more of its executive officers serving as a member of our board of directors or our compensation committee. For a description of transactions
between us and members of our compensation committee and affiliates of such members, please see “Certain Relationships and Related-Party
Transactions.”



| | Item 12. | Security
                                            Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
| | -------- | ------------------------------------------------------------------------------------------------------------------------------------------



Security Ownership of Certain Beneficial Owners



The following table sets forth information with respect to the beneficial
ownership of our common stock as of March 17, 2022, for:



| | ➢ | each
                                            of our named executive officers;
| | - | ---------------------------------------------------------------------------------



| | ➢ | each
                                            of our directors;
| | - | ------------------------------------------------------------------



| | ➢ | all
                                            of our current directors and executive officers as a group; and
| | - | ---------------------------------------------------------------------------------------------------------------



| | ➢ | each
                                            person, or group of affiliated persons, known by us to be the beneficial owner of more than
                                            5% of our outstanding shares common stock.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





65







We have determined beneficial ownership in accordance
with the rules of the SEC, which generally means that a person has beneficial ownership of a security if he or she possesses sole
or shared voting or investment power of that security, including options or warrants that are currently exercisable or exercisable within
60 days of March 17, 2022. We did not, however, deem such shares outstanding for the purpose of computing the percentage ownership
of any other person. Unless otherwise indicated, to our knowledge, the persons and entities named in the table below have sole voting
and sole investment power with respect to all shares that they beneficially own, subject to community property laws where applicable.
The information in the table below does not necessarily indicate beneficial ownership for any other purpose, including for purposes of
Sections 13(d) and 13(g) of the Securities Act. The calculations are based on 12,717,794 shares of common stock outstanding
on March 17, 2022.



Unless otherwise indicated, the address of each beneficial owner listed
in the table below is c/o Nuvectis Pharma, Inc., 1 Bridge Plaza, Fort Lee, NJ 07024.



|Name of Beneficial Owner                                        |  | Number of  Shares  Beneficially  Owned |           |  | Percentage of Shares Beneficially Owned | 
|--------------------------------------------------------------- |  | -------------------------------------- | --------- |  | --------------------------------------- | 
|5% and Greater Stockholders:                                    |  |                                        |           |  |                                         | 
|Pontifax VI LP(1)                                               |  |                                        | 1,379,360 |  |                                         | 
|Charles Mosseri Marlio                                          |  |                                        | 1,265,200 |  |                                         | 
|Thomas P. Peters 2012 Family Trust                              |  |                                        | 755,200   |  |                                         | 
|Named Executive Officers and Directors:                         |  |                                        |           |  |                                         | 
|Ron Bentsur(2)                                                  |  |                                        | 2,724,700 |  |                                         | 
|Enrique Poradosu(3)                                             |  |                                        | 1,149,250 |  |                                         | 
|Shay Shemesh(4)                                                 |  |                                        | 1,131,216 |  |                                         | 
|Uri Ben-Or (8)                                                  |  |                                        | 25,584    |  |                                         | 
|Kenneth Hoberman(5)                                             |  |                                        | 49,140    |  |                                         | 
|Matthew Kaplan(6)                                               |  |                                        | 32,760    |  |                                         | 
|James F. Oliviero III(7)                                        |  |                                        | 9,828     |  |                                         | 
|All executive officers and directors as a group (7 persons) (8) |  |                                        | 5,096,094 |  |                                         | 



* Represents beneficial ownership of less than 1%.

1)Pontifax Management 4 GP (2015) Ltd. is the general partner (the “General Partner”) of Pontifax VI GP L.P, the general
partner of each of, Pontifax VI (Cayman) LP and Pontifax VI (Israel) LP (which are collectively referred to as “Pontifax VI LP”).
Mr. Tomer Kariv holds approximately 51% of the share capital of the General Partner; as a result, Mr. Kariv may be deemed to
exercise control over Pontifax VI LP. The remaining share capital is held by Mr. Ran Nussbaum. Mr. Kariv and Mr. Nussbaum
disclaim beneficial ownership of all the reported shares and the inclusion of all shares herein shall not be deemed to be an admission
of beneficial ownership of the reported shares except to the extent of their pecuniary interest therein.

2)This excludes 96,759 shares of restricted stock granted to Mr. Bentsur on July 27, 2021 in connection with the closing
of the $15.3 million Preferred A capital raise. These restricted shares vest on July 27, 2022.

3)This excludes 48,399 shares of restricted stock granted to Mr. Poradosu on July 27, 2021 in connection with the closing
of the $15.3 million Preferred A capital raise. These restricted shares vest on July 27, 2022.

4)This excludes 48,399 shares of restricted stock granted to Mr. Shemesh on July 27, 2021 in connection with the closing
of the $15.3 million Preferred A capital raise. These restricted shares vest on July 27, 2022.

5)Excludes 16,380 shares owned by the Hoberman Descendants Trust, to which Mr. Hoberman disclaims ownership. On July 19,
2021, Mr. Hoberman was granted 29,250 options vesting over a 3-year period, 1/3 each year, exercisable into common shares of the
Company at a price of $3.05.

6)On September 2, 2021, Mr. Kaplan was granted 29,250 options vesting over a 3-year period, 1/3 each year, exercisable
into common shares of the Company at a price of $3.05.

7)On July 6, 2021, Mr. Oliviero was granted 29,250 options vesting over a 3-year period, 1/3 each year, exercisable into
common shares of the Company at a price of $3.05.

8)On March 21, 2022 Uri Ben-Or's position as Interim Chief Financial Officer was terminated. Mr. Ben-Or was replaced by
Michael Carson, our Vice President of Finance. On November 1, 2021, Mr. Carson received a restricted stock grant of 27,300
shares, vesting over 3 years, with no shares currently vested.





66







Item 13.Certain
Relationships and Related Transactions, and Director Independence.



Since inception, we have not been involved in
a transaction or series of similar transactions that:





| | ➢ | the
                                            amount involved exceeded or exceeds $120,000 or 1% of the average of our total assets as
                                            of December 31, 2021 and 2020; and
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ➢ | any
                                            of our directors or executive officers, any holder of 5% of our capital stock or any member
                                            of their immediate family had or will have a direct or indirect material interest.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Policies and Procedures for Transaction with Related Persons



Upon the consummation of our initial public offering,
our board of directors adopted a written related person transaction policy, setting forth the policies and procedures for the review
and approval or ratification of related person transactions. This policy covers, with certain exceptions set forth in Item 404 of Regulation
S-K under the Securities Act, any transaction, arrangement or relationship, or any series of similar transactions, arrangements or relationships
in which we were or are to be a participant, where the amount involved exceeds $120,000 or 1% of the average of our total assets as of
December 31, 2021 and 2020 and a related person had or will have a direct or indirect material interest, including without limitation
purchases of goods or services by or from the related person or entities in which the related person has a material interest, indebtedness,
guarantees of indebtedness and employment by us of a related person. In reviewing and approving any such transactions, our audit committee
is tasked to consider all relevant facts and circumstances, including but not limited to whether the transaction is on terms comparable
to those that could be obtained in an arm’s length transaction with an unrelated third party and the extent of the related person’s
interest in the transaction.



Director Independence



Our board of directors has determined that Kenneth
Hoberman, Matthew Kaplan and James Oliviero are independent directors. In making this determination, our board of directors applied the
standards set forth in the rules of Nasdaq and in Rule 10A-3 under the Exchange Act. Our board of directors considered all
relevant facts and circumstances known to it in evaluating the independence of these directors, including their current and historical
employment, any compensation we have given to them, any transactions we have with them, their beneficial ownership of our capital stock,
their ability to exert control over us, all other material relationships they have had with us and the same facts with respect to their
immediate families.



Although there is no specific policy regarding
diversity in identifying director nominees, the board of directors seek the talents and backgrounds that would be most helpful to us
in selecting director nominees.





67







Item 14.Principal
Accounting Fees and Services



The following presents the aggregate fees billed
to the Company for professional services rendered by Kesselman & Kesselman, Certified Public Accountants (Isr.), a member firm
of PricewaterhouseCoopers International Limited (“PwC”) for our years ended December 31, 2021 and 2020.



Audit Fees



The fees for professional services rendered for
audit and review of our financial statements since our inception through December 31, 2020 and for the year ended December 31,
2021 were $200,000 and $195,000, respectively.



Audit-Related Fees



There have been no audit-related fees billed
by our accountants in the last two fiscal years of our Company.



Tax Fees



There have been no tax fees billed by our accountants
in the last two fiscal years of our Company.



All Other Fees



There have been
no other fees billed by our accountants in the last two fiscal years of our Company.





68









PART IV



| | Item 15. | Exhibits
                                            and Financial Statement Schedules
| | -------- | --------------------------------------------------------------------------------------



(a)Financial
Statements.



The following financial statements are filed
as part of this report:



|Report
    of Independent Registered Public Accounting Firm ( PCAOB ID#1309)                                                      | F-2       
|--------------------------------------------------------------------------------------------------------------------------------- | ----------
|Financial Statements:                                                                                                             |           
|Balance Sheets
    as of December 31, 2021 and 2020                                                                               | F-3       
|Statements
    of Operations for the Years Ended December 31, 2021 and 2020                                                       | F-4       
|Statements
    of Redeemable convertible preferred stock and Shareholders’ deficit for the Years Ended December 31, 2021 and 2020 | F-5       
|Statements
    of Cash Flows for the Years Ended December 31, 2021 and 2020                                                       | F-6       
|Notes to
    Financial Statements                                                                                                 | F-7 - F-27



69







NUVECTIS PHARMA INC.



INDEX TO FINANCIAL STATEMENTS



U.S. DOLLARS



|                                                                                                                           | Page     
|-------------------------------------------------------------------------------------------------------------------------- | ---------
|                                                                                                                           |          
|REPORT
    OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PCAOB name: Kesselman & Kesselman C.P.A.s and PCAOB ID: 1309) | F-2      
|FINANCIAL
    STATEMENTS:                                                                                                  |          
|Balance
    Sheets                                                                                                         | F-3      
|Statements
    of Operations                                                                                               | F-4      
|Statements
    of Redeemable convertible preferred stock and stockholders' deficit                                         | F-5      
|Statements
    of Cash Flows                                                                                               | F-6      
|Notes
    to the Financial Statements                                                                                      | F-7-
F-27



F-1











Report of Independent Registered
Public Accounting Firm



To the board
of directors and shareholders of Nuvectis Pharma, Inc.



Opinion on the Financial Statements



We have audited the accompanying balance sheets
of Nuvectis Pharma, Inc. (the "Company") as of December 31, 2021 and 2020, and the related statements of operations,
changes in redeemable convertible preferred stock and stockholders' deficitand cash flows
for the year ended December 31, 2021 and for the period from July 27, 2020 (inception) to December 31, 2020, including
the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present
fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the result of its
operations and its cash flows for the year ended December 31, 2021 and for the period from July 27, 2020 (inception) to December 31,
2020 in conformity with accounting principles generally accepted in the United States of America.



Basis for Opinion



These financial statements are the responsibility
of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our
audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.



We conducted our
audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whetherthe financial statements are free of material misstatement, whether due
to error or fraud.



Our audits included performing procedures to
assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that
respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial
statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well
as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.



/s/ Kesselman & Kesselman

Certified Public Accountants (Isr.)

A member firm of PricewaterhouseCoopers International Limited



Tel-Aviv, Israel

March 23, 2022



We have served as the Company's auditor since
2021.



Kesselman & Kesselman,
146 Derech Menachem Begin St. Tel-Aviv 6492103, Israel,
P.O Box 7187 Tel-Aviv 6107120, Telephone: +972 -3- 7954555, Fax:+972 -3- 7954556, www.pwc.com/il



Kesselman & Kesselman
is a member firm of PricewaterhouseCoopers International Limited, each member firm of which is a separate legal entity









F-2







NUVECTIS PHARMA, INC.



BALANCE
SHEETS



(USD
in thousands, except per share and share amounts)



|                                                                                                                                                                                                                                                                                                          |  | December 31, |        
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------ | -------
|                                                                                                                                                                                                                                                                                                          |  | 2021         |        
|Assets                                                                                                                                                                                                                                                                                                    |  |              |        
|CURRENT ASSETS:                                                                                                                                                                                                                                                                                           |  |              |        
|Cash and cash equivalents                                                                                                                                                                                                                                                                                 |  |              | 5,742  
|Other current assets                                                                                                                                                                                                                                                                                      |  |              | 91     
|TOTAL CURRENT ASSETS                                                                                                                                                                                                                                                                                      |  |              | 5,833  
|                                                                                                                                                                                                                                                                                                          |  |              |        
|Deferred offering costs                                                                                                                                                                                                                                                                                   |  |              | 824    
|TOTAL ASSETS                                                                                                                                                                                                                                                                                              |  |              | 6,657  
|                                                                                                                                                                                                                                                                                                          |  |              |        
|Liabilities, Redeemable Convertible Preferred Shares and
Stockholders’ Deficit                                                                                                                                                                                                                            |  |              |        
|                                                                                                                                                                                                                                                                                                          |  |              |        
|Accounts payables                                                                                                                                                                                                                                                                                         |  |              | 1,058  
|Payable offering costs                                                                                                                                                                                                                                                                                    |  |              | 824    
|Accrued liabilities                                                                                                                                                                                                                                                                                       |  |              | 395    
|Employee compensation
and benefits                                                                                                                                                                                                                                                                        |  |              | 142    
|TOTAL CURRENT LIABILITIES                                                                                                                                                                                                                                                                                 |  |              | 2,419  
|TOTAL LIABILITIES                                                                                                                                                                                                                                                                                         |  |              | 2,419  
|                                                                                                                                                                                                                                                                                                          |  |              |        
|COMMITMENTS AND CONTINGENCIES, see
Note 5                                                                                                                                                                                                                                                                 |  |              |        
|REDEEMABLE CONVERTIBLE PREFERRED SHARES:                                                                                                                                                                                                                                                                  |  |              |        
|Convertible preferred stock A, $0.00001 par value – 170,000
and 40,000 shares authorized as of December 31, 2021 and December 31, 2020, respectively. As of December 31, 2021, 128,520
preferred shares were issued and outstanding. No preferred stock was issued or outstanding as of December 31, 2020 |  |              | 15,246 
|                                                                                                                                                                                                                                                                                                          |  |              |        
|STOCKHOLDERS’
DEFICIT,see Note 6:                                                                                                                                                                                                                                                                         |  |              |        
|Common Stock, $0.00001 par value – 12,870,000 and 3,900,000 shares authorized
as of December 31, 2021 and December 31, 2020, respectively 4,505,514 and 3,900,000 shares issued and outstanding as of December 31,
2021 and December 31, 2020, respectively (**)                                          |  |              | *      
|Additional paid in capital                                                                                                                                                                                                                                                                                |  |              | 1,892  
|Notes received for common shares                                                                                                                                                                                                                                                                          |  |              | (*     
|Accumulated deficit                                                                                                                                                                                                                                                                                       |  |              | (12,900
|TOTAL STOCKHOLDERS’ DEFICIT                                                                                                                                                                                                                                                                               |  |              | (11,008
|TOTAL LIABILITIES, REDEEMABLE COVERTIBLE
PREFERRED SHARES AND STOCKHOLDERS’ DEFICIT                                                                                                                                                                                                                       |  |              | 6,657  



* Represent amount lower than $1,000 USD.



** Adjusted to reflect stock splits, see note 1.



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





F-3







NUVECTIS PHARMA, INC.





STATEMENT
OF OPERATIONS



(USD
in thousands, except per share and share amounts)



|                                                                             |  | For
    the year ended
    December 31, 2021 |           |   | For
                                            the period from
                                            July 27, 2020* until
                                            December 31, 2020 | 
|---------------------------------------------------------------------------- |  | -------------------------------------------- | --------- | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|OPERATING EXPENSES:                                                          |  |                                              |           |   |                                                                                                                                                                                                | 
|RESEARCH AND DEVELOPMENT                                                     |  |                                              | 9,545     |   |                                                                                                                                                                                                | 
|GENERAL
    AND ADMINISTRATIVE                                               |  |                                              | 3,349     |   |                                                                                                                                                                                                | 
|                                                                             |  |                                              |           |   |                                                                                                                                                                                                | 
|OPERATING LOSS                                                               |  |                                              | (12,894   | ) |                                                                                                                                                                                                | 
|FINANCE
    INCOME                                                           |  |                                              | 4         |   |                                                                                                                                                                                                | 
|                                                                             |  |                                              |           |   |                                                                                                                                                                                                | 
|NET LOSS                                                                     |  |                                              | (12,890   | ) |                                                                                                                                                                                                | 
|NET LOSS ATTRIBUTABLE TO COMMON
    SHAREHOLDER                              |  |                                              | (12,890   | ) |                                                                                                                                                                                                | 
|BASIC AND DILUTED NET LOSS PER
    COMMON SHARE OUTSTANDING, see Note 8      |  |                                              | 3.02      |   |                                                                                                                                                                                                | 
|BASIC AND DILUTED WEIGHTED AVERAGE
    NUMBER OF COMMON SHARES OUTSTANDING** |  |                                              | 4,268,285 |   |                                                                                                                                                                                                | 



*
     The date of the Company’s inception.



**   Adjusted to reflect stock split, see note
1.



*** Less than $0.01.



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





F-4









NUVECTIS PHARMA, INC.



STATEMENTS
OF CHANGES IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT



(USD
in thousands, except share amounts)



|                                                                            |  | Redeemable
    Convertible
    Preferred Stock
    $0.00001 Par Value |  |  | Common
    Shares
    $0.00001 Par Value |  |  | Notes
    received
    from
    Common |  |  | Additional
    Paid-In |  |  | Accumulated |   |  | Total
    
    Stockholders’ | 
|--------------------------------------------------------------------------- |  | --------------------------------------------------------------------- |  |  | ---------------------------------------- |  |  | -------------------------------------- |  |  | ---------------------- |  |  | ----------- | - |  | ---------------------------- | 
|                                                                            |  | Shares                                                                |  |  | Amount                                   |  |  | Shares***                              |  |  | Amount                 |  |  | shares      |   |  | Capital                      | 
|CHANGES DURING THE PERIOD
    FROM JULY 27, 2020* until DECEMBER  31, 2020: |  |                                                                       |  |  |                                          |  |  |                                        |  |  |                        |  |  |             |   |  |                              | 
|Issuance of common
    shares                                               |  | -                                                                     |  |  | -                                        |  |  | 3,900,000                              |  |  | **                     |  |  | (**         | ) |  | -                            | 
|Net loss for the period                                                     |  |                                                                       |  |  |                                          |  |  | -                                      |  |  | -                      |  |  | -           |   |  |                              | 
|BALANCES AT DECEMBER 31, 2020                                               |  | -                                                                     |  |  | -                                        |  |  | 3,900,000                              |  |  | **                     |  |  | (**         | ) |  | -                            | 
|Issuance of Series A redeemable convertible preferred
    shares            |  | 128,520                                                               |  |  | 15,246                                   |  |  |                                        |  |  |                        |  |  |             |   |  |                              | 
|Share-based payments                                                        |  |                                                                       |  |  |                                          |  |  | 605,514                                |  |  | **                     |  |  | -           |   |  | 1,892                        | 
|Net Loss                                                                    |  |                                                                       |  |  |                                          |  |  |                                        |  |  |                        |  |  |             |   |  |                              | 
|BALANCES AT DECEMBER
    31, 2021                                           |  | 128,520                                                               |  |  | 15,246                                   |  |  | 4,505,
    514                         |  |  | **                     |  |  | (**         | ) |  | 1,892                        | 



*
The date of the Company’s inception.

**Represent amount lower than $1,000 USD.

*** Adjusted to reflect stock splits, see note 1.



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





F-5







NUVECTIS PHARMA, INC.



STATEMENTS OF CASH FLOWS



(USD
in thousands, except per share and share amounts)



|                                                                                                         |  | For the year
    ended December 31,
    2021 |   |  | For the period
    from July 27,
    2020* until
    December 31,
    2020 |  
|-------------------------------------------------------------------------------------------------------- |  | -------------------------------------------- | - |  | -------------------------------------------------------------------------- | -
|CASH FLOWS FROM OPERATING ACTIVITIES:                                                                    |  |                                              |   |  |                                                                            |  
|Net loss                                                                                                 |  | (12,890                                      | ) |  | (10                                                                        | )
|Adjustments to reconcile loss to net cash used in operating activities:
    Cost of share-based payments |  | 1,892                                        |   |  | -                                                                          |  
|Changes in operating assets and liabilities
    :                                                        |  |                                              |   |  |                                                                            |  
|Increase in other
    current assets                                                                     |  | (91                                          | ) |  | -                                                                          |  
|Increase in accounts
    payable and accrued expenses                                                    |  | 1,585                                        |   |  | 10                                                                         |  
|Net cash used in operating activities                                                                    |  | (9,504                                       | ) |  | -                                                                          |  
|CASH FLOWS FROM INVESTING ACTIVITIES:                                                                    |  |                                              |   |  |                                                                            |  
|Net cash provided by (used in) investing
    activities                                                  |  | -                                            |   |  | -                                                                          |  
|CASH FLOWS FROM FINANCING ACTIVITIES:                                                                    |  |                                              |   |  |                                                                            |  
|Proceeds from issuance of redeemable
    convertible preferred shares                                    |  | 15,246                                       |   |  | -                                                                          |  
|Net cash provided by financing activities                                                                |  | 15,246                                       |   |  | -                                                                          |  
|INCREASE IN CASH AND CASH EQUIVALENTS                                                                    |  | 5,742                                        |   |  | -                                                                          |  
|CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                                         |  | -                                            |   |  | -                                                                          |  
|CASH AND CASH EQUIVALENTS AT END OF PERIOD                                                               |  | 5,742                                        |   |  | -                                                                          |  
|                                                                                                         |  |                                              |   |  |                                                                            |  
|Supplemental cash flow information:                                                                      |  |                                              |   |  |                                                                            |  
|Interest
    paid                                                                                        |  | --                                           |   |  | --                                                                         |  
|Income
    tax paid                                                                                      |  | --                                           |   |  | --                                                                         |  
|                                                                                                         |  |                                              |   |  |                                                                            |  
|Supplemental noncash disclosure of investing and financing
    activities:                               |  |                                              |   |  |                                                                            |  
|Issuance
    of common shares in return for note receivable                                              |  | -                                            |   |  | **                                                                         |  
|Unpaid
    deferred offering costs                                                                       |  | 824                                          |   |  | -                                                                          |  



*
The date of the Company’s inception.

**Represent amount lower than $1,000 USD.



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





F-6







NUVECTIS PHARMA, INC.



Notes to the Financial Statements



NOTE 1 – GENERAL:



| | a. | Nuvectis
                                            Pharma Inc. (formerly Centry Pharma Inc.) (hereafter – the “Company”) was
                                            incorporated under the laws of the State of Delaware on July 27, 2020 and commenced
                                            its principal operations in May 2021. The company's principal executive offices are
                                            located at Fort Lee in the state of New Jersey.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The Company is a biopharmaceutical company
focused on the development of novel targeted small molecule therapeutics for the treatment of cancer in genetically defined patient populations.
The Company's precision medicine approach translates key scientific insights relating to the oncogenic drivers and pathway addiction
of cancer into potent and highly selective anticancer drugs.



| | b. | In
                                            May 2021, the Company entered into a worldwide, exclusive license agreement with the
                                            CRT Pioneer Fund (“CRT”) (see note 5a).
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | c. | In May 2021, the Company’s board of directors approved and declared a 1:100 stock split of
common and preferred shares. In addition, on October 23, 2021 the Company’s Board of Directors approved a 39 for 1 stock split
of common stock. All the share and per share amounts reflected in these financial statements and the notes thereto have been adjusted,
on a retroactive basis, to reflect these share splits (see note 6b).
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | d. | In
                                            August 2021, the Company entered into a worldwide, exclusive license agreement with
                                            the University of Edinburgh, Scotland for the Company’s second drug candidate (see
                                            note 5a).
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | e. | In
                                            February 2022, the Company’s shares began trading on the NASDAQ under symbol “NVCT”
                                            (see note 11).
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | f. | Liquidity
| | -- | ---------



The accompanying financial statements
have been prepared assuming that the Company will continue as a going concern. The Company has incurred net operating losses since its
inception and had an accumulated deficit of $12.9 million as of December 31, 2021. The Company had cash and cash equivalents of
$5.7 million as of December 31, 2021 and has not generated positive cash flows from operations. To date, the Company has been able
to fund its operations primarily through the issuance of redeemable convertible preferred shares. During 2021, the Company has received
an aggregate of $15.3 million in proceeds from the issuance of shares of its Series A redeemable convertible preferred shares. The
Company paid $0.1 million in issuance costs.



On February 8, 2022, subsequent
to the reporting period, the Company completed an initial public offering (“IPO”) in which it sold 3,200,000 shares of common
stock at $5.00 per share and received net proceeds of $13.6 million, after underwriting discounts and commissions, of $1.1 million and
expenses of $1.3 million (see note 11).



Based on management’s cash flow
projections, the Company believes that the Company’s currently available cash and cash equivalents as of December 31, 2021
along with funds received from the IPO is sufficient to fund the Company’s planned operations for a period greater than 12 months
from the issuance of these financial statements. The Company will need to raise additional capital in order to complete the clinical
trials aimed at developing the product candidates until obtaining its regulation and marketing approvals. There can be no assurances
that the Company will be able to secure such additional financing if at all, or at terms that are satisfactory to the Company, and that
it will be sufficient to meet its needs. In the event the Company is not successful in obtaining sufficient funding, this could force
the Company to delay, limit, or reduce our products’ development, clinical trials, commercialization efforts or other operations,
or even close down or liquidate.





F-7







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 1 – GENERAL: (continued)



| | g. | Coronavirus
                                            Pandemic
| | -- | ----------------------------------------------------------------



In March 2020, the World Health
Organization declared the outbreak of COVID-19 to be a pandemic. The COVID-19 pandemic is having widespread, rapidly evolving, and unpredictable
impacts on global society, economies, financial markets, and business practices. During 2021, there was a wide distribution of several
vaccinations and medicines to overcome the pandemic. The Company has shifted its operations to co-exist along with the pandemic, including
encouragement of vaccinations to all of its employees worldwide.



The uncertainty to which the COVID-19
pandemic impacts the Company’s business, affects management’s judgment and assumptions relating to accounting estimates in
a variety of areas that depend on these estimates and assumptions. COVID-19 did not have a material influence on these estimates and
judgements since the Company began operations in 2021.



The Company continues to face relative
uncertainty as to the remaining intensity and duration of and the nature and timeline for recovery from the COVID-19 pandemic going forward
and how all of that impacts the Company, including the extent to which potentially permanent changes clinical trial operations have been
caused by the pandemic. The Company has taken the approach of managing the pandemic (to the extent that it continues to remain a significant
factor) via strengthening its balance sheet and cash assets and avoiding debt while focusing on cost controls.



NOTE
2 – SIGNIFICANT ACCOUNTING POLICIES:



| | a. | Basis
                                            of Presentation
| | -- | -----------------------------------------------------------------



The
accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States
of America (“US GAAP”) and stated in U.S. dollars. The significant accounting policies used in the preparation of
the financial statements are as follows:



| | b. | Segment
                                            Reporting
| | -- | -------------------------------------------------------------



The Company has one operating segment.
An operating segment is defined as a component that engages in business activities whose operating results are reviewed by the chief
operating decision maker for the purpose of assessing performance and allocating resources and for which discrete financial information
is available.



| | c. | Use
                                            of Estimates in the Preparation of Financial Statements
| | -- | -------------------------------------------------------------------------------------------------------



The preparation of the Company’s
financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities and
expenses in the Company’s financial statements and accompanying notes. The most significant estimates in the Company’s financial
statements relate to accruals for research and development expenses, valuation of equity awards, and valuation allowances for deferred
tax assets. These estimates and assumptions are based on current facts, future expectations, and various other factors 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 and the recording of expenses that are not readily apparent from other sources. Actual results may differ materially and
adversely from these estimates.





F-8







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE
2 – SIGNIFICANT ACCOUNTING POLICIES: (continued)



| | d. | Functional
                                            and Presentation Currency
| | -- | --------------------------------------------------------------------------------



The U.S. dollar (“dollar”) is
the currency of the primary economic environment in which the operations of the Company are conducted and expects to continue to operate
in the foreseeable future. Accordingly, the functional currency of the Company is the dollar.



| | e. | Functional
                                            and Presentation Currency
| | -- | --------------------------------------------------------------------------------



Adjustments arising from foreign currency
transactions between the purchase and the settlement dates are reflected in the statements of operations as a component of financial
income (expense). For non-dollar transactions and other items in the statements of operations (indicated below), the following exchange
rates are used: (i) for transactions — exchange rates at transaction dates or average rates; and (ii) for other items
(derived from non-monetary balance sheet items such as depreciation) — historical exchange rates.



The Company did not recognize net foreign
currency transaction gains in the year ended December 31, 2021 and the period July 27, 2020 through December 31, 2020.



| | f. | Cash
                                            and Cash Equivalents
| | -- | ---------------------------------------------------------------------



The Company considers as cash equivalents
all highly liquid investments, which include short-term bank deposits that are not restricted as to withdrawal or use, with maturities
of three months or less at the date acquired, are considered to be cash equivalents.



| | g. | Concentrations
                                            of Credit Risk
| | -- | -------------------------------------------------------------------------



The Company is subject to credit risk
from holding its cash and cash equivalents at one commercial bank. The Company limits its exposure to credit losses by investing in money
market accounts which are included in cash and cash equivalents through a U.S. bank with high credit ratings. Cash may consist of deposits
held with banks that may at times exceed federally insured limits, however, exposure to credit risk in the event of default by the financial
institution is limited to the extent of amounts recorded on the balance sheets. The Company has not experienced any losses in such accounts
and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions
in which those deposits are held.



| | h. | Leases
| | -- | ------



In
accordance withAccounting Standards Codification (“ASC”) 842, Leases, the Company defines a short-term lease if a
lease has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably
certain to exercise. At the inception of the lease and as of December 31, 2021, the Company determined all leases were classified
as short-term. Short-term leases with an initial term of 12 months or less are not recorded on the balance sheet. Lease expense for minimum
lease payments is recognized on a straight-line basis over the lease term in general and administrative. For real estate leases, the
Company does not separate lease and non-lease components. The Company’s lease agreements do not contain any material residual value
guarantees or material restrictive covenants. The operating lease costs for 2021 was $11 thousand.





F-9







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE
2 – SIGNIFICANT ACCOUNTING POLICIES: (continued)



| | i. | Research
                                            and Development Expenses
| | -- | -----------------------------------------------------------------------------



Research and development expenses include
costs directly attributable to the conduct of research and development programs, including licensing fees, cost of salaries, share-based
compensation expenses, payroll taxes and other employee benefits, subcontractors and materials used for research and development activities,
including clinical trials, manufacturing costs and professional services. All costs associated with research and developments are expensed
as incurred.



| | j. | General
                                            and Administrative
| | -- | ----------------------------------------------------------------------



General and administrative expenses consist
primarily of personnel-related expenses, including employee salaries, bonuses, benefits, and share-based compensation, and recruiting
costs for personnel in executive, finance, and other administrative functions. Other significant general and administrative expenses
include legal fees relating to intellectual property and corporate matters, professional fees for accounting, tax and consulting services,
insurance costs, and travel expenses. General and administrative costs are expensed as incurred.



| | k. | Loss
                                            Contingencies
| | -- | --------------------------------------------------------------



Certain conditions may exist as of the
date of the financial statements, which may result in a loss to the Company, but which will only be resolved when one or more future
events occur or fail to occur. The Company’s management assesses such contingent liabilities, and such assessment inherently involves
an exercise of judgment.



Management applies the guidance in ASC
450-20-25 when assessing losses resulting from contingencies. If the assessment of a contingency indicates that it is probable that a
material loss has been incurred and the amount of the liability can be estimated, then the estimated liability is recorded as accrued
expenses in the Company’s financial statements. If the assessment indicates that a potential material loss contingency is not probable
but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate
of the range of possible loss if determinable and material are disclosed. As of December 31, 2021, and December 31, 2020, no
contingent liabilities have been recognized.



| | l. | Share-Based
                                            Compensation
| | -- | --------------------------------------------------------------------



The Company accounts for employees’,
directors’ and service providers’ share-based payment awards classified as equity awards using the grant-date fair value method.
The fair value of share-based payment transactions is recognized as an expense over the requisite service period. The equity awards could
come in the form of options, warrants and RSUs.



The Company elected to recognize compensation
costs for awards conditioned only on continued service that have a graded vesting schedule using the accelerated method based on the
multiple-option award approach. Performance based awards are expensed over the vesting period when the achievement of performance criteria
is probable.





F-10







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE
2 – SIGNIFICANT ACCOUNTING POLICIES: (continued)



The Company has elected to recognize
forfeitures as they occur.



For stock options containing a market
condition, the market conditions are required to be considered when calculating the grant date fair value. ASC 718 requires selection
of a valuation technique that best fits the circumstances of an award. In order to reflect the substantive characteristics of the market
condition option award, a Monte Carlo simulation valuation model was used to calculate the grant date fair value of such stock options.
Expense for the market condition stock options is recognized over the derived service period as determined through the Monte Carlo simulation
model.



| | m. | Comprehensive
                                            Loss
| | -- | --------------------------------------------------------------



Comprehensive loss includes no items
other than net loss.



| | n. | Income
                                            Taxes
| | -- | --------------------------------------------------------



| | 1) | Deferred taxes
| | -- | --------------



The Company accounts for income taxes
in accordance with ASC 740, “Income Taxes” (hereafter – “ASC 740”). ASC 740 prescribes that Income
taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities
are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using
the currently enacted tax rates and laws. A valuation allowance is recognized to the extent that it is more likely than not that the
deferred taxes will not be realized in the foreseeable future.



Given
the Company’s losses, the Company concluded it is more likely than not the deferred tax assets will not be realized and has provided
a full valuation allowance with respect to its deferred tax assets.



| | 2) | Uncertainty in income taxes
| | -- | ---------------------------



The Company accounts for uncertain
tax positions in accordance with ASC 740-10. The Company follows a two-step approach in recognizing and measuring uncertain tax positions.
The first step is to evaluate the tax position for recognition by determining if the available evidence indicates that it is more likely
than not that the position will be sustained based on technical merits. If this threshold is met, the second step is to measure the tax
position as the largest amount that has more than a 50% likelihood of being realized upon ultimate settlement. The Company does not have
any provision for uncertain tax positions.



| | o. | Net
                                            Loss Per Share
| | -- | --------------------------------------------------------------



The Company’s basic net loss per
share is calculated by dividing net loss attributable to ordinary shareholders by the weighted-average number of ordinary shares outstanding
for the period, without consideration of potentially dilutive securities. The diluted net loss per share is calculated by giving effect
to all potentially dilutive securities outstanding for the period using the treasury share method or the if-converted method based on
the nature of such securities. Diluted net loss per share is the same as basic net loss per share in periods when the effects of potentially
dilutive shares of ordinary shares are anti-dilutive.





F-11







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE
2 – SIGNIFICANT ACCOUNTING POLICIES: (continued)



The Company computes net loss per share
using the two-class method required for participating securities. The two-class method requires income available to ordinary shareholders
for the period to be allocated between ordinary shares and participating securities based upon their respective rights to receive dividends
as if all income for the period had been distributed. The Company considers its redeemable convertible preferred shares to be participating
securities as the holders of the redeemable convertible preferred shares would be entitled to dividends that would be distributed to
the holders of ordinary shares on a pro-rata basis assuming conversion of all redeemable convertible preferred shares into ordinary shares.
These participating securities do not contractually require the holders of such shares to participate in the Company’s losses.
As such, net loss for the periods presented was not allocated to the Company’s preferred shares.



The following potentially dilutive securities were excluded
from the calculation of diluted net loss per Ordinary Share because their effect would have been anti-dilutive for the years presented:



|                                        |  | For the year
    end
    December 31,
    2021 |           |  | For the period
    end December
     31, 2020 | 
|--------------------------------------- |  | ---------------------------------------------- | --------- |  | --------------------------------------------- | 
|Common shares issuable in relation to:  |  |                                                |           |  |                                               | 
|Warrants*                               |  |                                                | 81,003    |  |                                               | 
|Options*                                |  |                                                | 226,590   |  |                                               | 
|RSU*                                    |  |                                                | 241,137   |  |                                               | 
|Redeemable convertible preferred shares |  |                                                | 5,012,280 |  |                                               | 



*- Adjusted to reflect stock splits, see note 6a.



| | p. | Fair
                                            Value Measurement
| | -- | ------------------------------------------------------------------



The Company follows authoritative accounting
guidance, which among other things, defines fair value, establishes a consistent framework for measuring fair value, and expands disclosure
for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is defined
as the exchange price that would be received to sell an asset or paid to transfer a liability (at exit price) in the principal or most
advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The three
levels of inputs that may be used to measure fair value include:



Level 1: Quoted
prices (unadjusted) in active markets for identical assets or liabilities that are accessible at the measurement date for assets or liabilities.
The fair value hierarchy gives the highest priority to Level 1 inputs. The Company’s Level 1 assets consist of money market funds.



Level 2: Observable
inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities in active markets or other inputs that are
observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.



Level 3: Unobservable
inputs that are supported by little or no market activity. The fair value hierarchy gives the lowest priority to Level 3 inputs.





F-12







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE
2 – SIGNIFICANT ACCOUNTING POLICIES: (continued)



| | p. | Fair
                                            Value Measurement(continued)
| | -- | -----------------------------------------------------------------------------



In determining fair value, the Company
utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible
and considers counterparty credit risk in its assessment of fair value.



The money market
accounts included in cash and cash equivalents are considered Level 1.



During the year ended December 31,
2021, there were no transfers between fair value measure levels. The company had no financial assets and liabilities measured at fair
value as of December 31, 2020. Other financial instruments consist mainly of cash and cash equivalents, other current assets, accounts
payable and accrued liabilities. The fair value of these financial instruments approximates their carrying values.



| | q. | Deferred
                                            Offering Costs
| | -- | -------------------------------------------------------------------



Deferred offering costs consist of legal
and other costs incurred in connection with the formation and preparation for the Initial Public Offering (“IPO”). These
costs, along with underwriting fees were charged to additional paid-in capital upon the completion of the Initial Public Offering. The
deferred offering costs will be offset against the proceeds received upon the completion of the IPO. Deferred offering costs are recorded
under other non-current assets on the accompanying balance sheets.



| | r. | Redeemable
                                            Convertible Preferred Shares
| | -- | -----------------------------------------------------------------------------------



When the Company issues convertible preferred
shares, it considers the provisions of ASC 480, Distinguishing Liabilities from Equity (“ASC 480”) in order to determine
whether the preferred share should be classified as a liability. If the instrument is not within the scope of ASC 480, the Company further
analyzes the instrument’s characteristics in order to determine whether it should be classified within temporary equity (mezzanine)
or within permanent equity in accordance with the provisions of ASC 480-10-S99. The Company’s redeemable convertible preferred
shares are not mandatorily or currently redeemable. However, they include a liquidation or deemed liquidation events that would constitute
a redemption event that is outside of the Company’s control. As such, all shares of redeemable preferred shares have been presented
outside of permanent equity.



| | s. | Recent
                                            Accounting Pronouncements
| | -- | ----------------------------------------------------------------------------



In December 2019, the FASB issued
ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which simplifies the accounting for income taxes,
eliminates certain exceptions within ASC 740, Income Taxes, and clarifies certain aspects of the current guidance to promote consistency
among reporting entities. The guidance is effective for fiscal years beginning after December 15, 2021, with early adoption permitted.
The Company adopted ASU 2019-12 when it commenced its principal operations in May 2021 and the standard did not have a material
impact on its financial statements and related disclosures.



| | t. | Recently
                                            Issued Accounting Pronouncements Not Yet Adopted
| | -- | -----------------------------------------------------------------------------------------------------



Management does not believe that any
recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s
financial statements.





F-13







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 3 – RESEARCH AND DEVELOPMENT EXPENSES:



Research and development expenses consisted
of the following (in thousands):



|                                        |  | For the year
    ended
    December 
    31, 2021 |  |  | For the period
    July 27, 2020
    to December
    31, 2020 | 
|--------------------------------------- |  | ------------------------------------------------- |  |  | ------------------------------------------------------------- | 
|License Fee                             |  | 7,111                                             |  |  | -                                                             | 
|Employee Compensation and Benefits      |  | 1,164                                             |  |  | -                                                             | 
|Clinical Expense                        |  | 670                                               |  |  | -                                                             | 
|Manufacturing                           |  | 424                                               |  |  | -                                                             | 
|Professional services and other         |  | 175                                               |  |  | -                                                             | 
|Total research and development expenses |  | 9,545                                             |  |  | -                                                             | 



NOTE 4 – GENERAL AND ADMINISTRATIVE
EXPENSES:



General and administrative expenses consisted
of the following (in thousands):



|                                          |  | For the year
    ended
    December 
    31, 2021 |  |  | For the period
    July 27, 2020
    to December 
    31, 2020 | 
|----------------------------------------- |  | ------------------------------------------------- |  |  | -------------------------------------------------------------- | 
|Professional and consulting services      |  | 2,574                                             |  |  | -                                                              | 
|Employee Compensation and Benefits        |  | 414                                               |  |  | -                                                              | 
|Other                                     |  | 361                                               |  |  | 10                                                             | 
|Total general and administrative expenses |  | 3,349                                             |  |  | 10                                                             | 



NOTE 5 – COMMITMENTS AND CONTINGENCIES:



| | a. | License agreement
| | -- | -----------------



CRT Pioneer Fund License Agreement



In May 2021, the Company entered
into a worldwide, exclusive license agreement with the CRT Pioneer Fund for CP800 and any of its derivatives, (collectively, the “CP800
Program”). CP800 is a small molecule drug candidate that the Company believes can be applied to a broad range of cancers. Prior
to licensing by the Company, CRT was the commercial owner of the CP800 Program, which it acquired from the Institute of Cancer Research
in London, UK (“ICR”). The ICR is a world-renowned research institute focused on the discovery and preclinical development
of cancer therapeutics pursuant to the license agreement, the Company has an obligation to pay success-based milestones and royalties
to CRT, as follows: 1) pre-approval milestone payments of up to approximately $26.5 million including an upfront nonrefundable payment
of $3.5 million which has already been paid; 2) regulatory approval and commercial sales milestones of up $178 million (in addition to
the above $26.5 million); and 3) mid-single digit to 10% royalties on a tiered basis on net sales.





F-14







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 5 – COMMITMENTS AND CONTINGENCIES (continued):



In addition, in connection with the licensing
agreement, the Company will provide ICR with up to an additional $500,000 in research and development support over the next 18 months
to conduct additional scientific research and preclinical testing for certain indications that the Company selects in connection with
the CP800 Program. According to the license agreement the Company has also exclusive license to intellectual property rights developed
in the collaboration, to research, develop and commercialize products resulting from the collaboration. As of December 31, 2021, ICR’s
research and development as described above has not yet begun and therefore no expenses were recorded in the financial statements.



License Term



The license will remain in effect in
each territory subject to the license and will continue until the Company’s obligation to pay royalties in such territory has expired.
The royalty term for each licensed product in each country commences with the first commercial sale of the applicable licensed product
in the applicable country and ends on the expiration of the last to expire of any patent specified by the license (with the key composition
of matters patent expiring October 2034) or the expiration of any extended exclusivity period in the relevant country. CRT may earlier
terminate the license if the Company, or any of our affiliates or sub-licensees, challenge or seek to challenge the validity of any of
the licensed patents or upon a change of control in which the Company becomes controlled by a Tobacco Party, as such term is defined
in the license. Either party may terminate the license upon material breach by the other party, and upon the appointment of a receiver
or upon a winding-up order or similar or equivalent action.



As of December 31, 2021, the Company
paid the upfront payment of $3.5 million. Those expenses were recorded as research and development expenses during the year ended December 31,
2021. Any potential future research support, milestone or royalty payment amounts have not been accrued at December  31, 2021 and
2020 due to the uncertainty related to the achievement of these events, milestones or commitments to additional research.



University of Edinburgh License Agreement



In August 2021, the Company entered
into a worldwide, exclusive license agreement with the University Court of the University of Edinburgh (“Edinburgh” or “University”
or “Parties” or “UoE”) for the second drug candidate.



The company is obligated to pay success-based
milestones and royalties to the UoE, as follows: (1) pre-approval milestone payments of up to approximately $49.5 million including
an upfront nonrefundable payment of $3.5 million which has already been paid and $0.5 million on the first anniversary of the effective
date of this agreement. (2) regulatory approval and commercial sales milestones of up $279.5 million. (3) mid- single digit
to 8% royalties on a tiered basis on net sales; and 2.5% of the gross amount of each of the Company’s future fund raisings up to
a cumulative total of $3.0 million.



In collaboration with Edinburgh, the
Company wishes to generate preclinical data to support Investigational New Drug (IND) submission and inform patient selection/enrichment
strategies. The aim of the development collaboration formed between the Parties under this Agreement is to progress the development of
the Licensed Technology, which is licensed under the License Agreement) according to the Work Plan. The Company has agreed to provide
funding to Edinburgh to support such collaboration.





F-15







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 5 – COMMITMENTS AND CONTINGENCIES (continued):



The Parties wish to enter into this Agreement
to set out the terms for the provision of such funding by the company and the terms of the development collaboration formed between the
Parties. In consideration of the obligations of Edinburgh, the Company shall pay the Project Costs in the amount of $772,000, payable
over 18 months. As of December 31, 2021, UoE’s research and development as described above has not yet begun and therefore
no expenses were recorded in the financial statements.



License Term



The royalty term for each licensed product
in each country is the period commencing with the first commercial sale of the applicable licensed product in the applicable country
and ending on the expiration of the last to expire of any patent specified by the license (statutory expiration for the NXP900 patent
family is April 2036), or the expiration of any extended exclusivity period in the relevant country. The Company may terminate the
license if the Company determines that it is not scientifically or commercially viable to research, develop, or commercialize the licensed
products which are the subject of the license agreement. UoE may terminate the agreement if the Company: (i) ceases to carry on
the business regarding the treatment, prevention and/or diagnosis of human diseases; (ii) discontinues the development



of the licensed products which are the
subject of the license; (iii) disposes of our assets or business in whole or in material part; (iv) challenges the validity,
ownership, or enforceability of the exclusively licensed technology; (v) contests the secret or substantial nature of certain know-how
subject to the license; or (vi) breaches certain diligence obligations or fails to pay any amount due under the license within a
specified time frame.



As of December 31, 2021, the Company
paid the upfront payment of $3.5 million. Those expenses were recorded as research and development expenses during the year ended December 31,
2021. Any potential future research support, milestone or royalty payment amounts have not been accrued at December 31, 2021 and
2020 due to the uncertainty related to the achievement of these events, milestones or commitments to additional research.



| | b. | Related
                                            Party Transactions
| | -- | ----------------------------------------------------------------------



As for related party transactions,
see note 10.



| | c. | Contingencies
| | -- | -------------



As of December 31, 2021, and as
of December 31, 2020, no contingent liabilities have been recognized.





F-16







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 6 – REDEEMABLE CONVERTIBLE PREFERRED SHARES AND SHAREHOLDERS’
DEFICIT:



| | a. | In
                                            May 2021, the Company’s board of directors approved and declared a 1:100 stock
                                            split of common shares with a par value of $0.00001 and preferred shares, with a par value
                                            of $0.00001. In addition, the Company increased the number of authorized common shares from
                                            3,900,000 to 12,870,000 and preferred shares from 40,000 to 170,000. In addition, on October 23,
                                            2021, the Company's Board of Directors approved a 39 for 1 stock split. As a result of the
                                            above splits, all shares, options and warrants exercisable into common shares and restricted
                                            stock units, exercise prices and income or loss per share amounts have been adjusted on a
                                            retroactive basis for all periods presented to reflect such stock splits.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b. | Redeemable Convertible Preferred Shares
| | -- | ---------------------------------------



During June and July 2021,
the Company entered into an investment agreement with its founders and certain new investors to issue 128,520 redeemable convertible
preferred shares (“Preferred Stock”) in a total amount of approximately $15.3 million in which $1.73 million were invested
by related parties on the same terms as all investors in the Preferred Stock.



The holders of shares of the Preferred
Stock have the following rights, preferences and privileges:



Voting rights —



On any matter presented to the stockholders
of the Company for their action or consideration at any meeting of stockholders of the Corporation (or by written consent of stockholders
in lieu of meeting), each holder of outstanding shares of Preferred Stock shall be entitled to cast the number of votes equal to the
number of whole shares of Common Stock into which the shares of Preferred Stock held by such holder, which is one share of Common Stock
for each Preferred Share (subject to the conversation ratio as described below) owned that are convertible as of the record date for
determining stockholders entitled to vote on such matter. Except as provided by law or by the other provisions of the Company’s
Certificate of Incorporation, holders of Preferred Stock shall vote together with the holders of Common Stock as a single class and on
an as-converted to Common Stock basis on a 1:1 basis on all matters.



Dividend rights —



The
Corporation shall not declare, pay or set aside any dividends on shares of any other class or series of capital stock of the Corporation
(other than dividends on shares of Common Stock payable in shares of Common Stock) unless (in addition to the obtaining of any consents
required elsewhere in the Company’s Certificate of Incorporation) the holders of the Preferred Stock then outstanding shall first
receive, or simultaneously receive, a dividend at least equal to the product of (A) the dividend payable on each share of
such class or series determined, if applicable, as if all shares of such class or series had been converted into Common Stock and (B) the
number of shares of Common Stock issuable upon conversion of a share of Preferred Stock, in each case calculated on the record date for
determination of holders entitled to receive such dividend.





F-17





NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 6 – REDEEMABLE CONVERTIBLE PREFERRED SHARES AND SHAREHOLDERS’
DEFICIT: (Continued):



Liquidation Rights —



In
the event of any Deemed Liquidation Event (as defined in the Company’s Certificate of Incorporation), the holders of shares of
Preferred Stock then outstanding shall be entitled to be paid out of the consideration payable to stockholders in such Deemed Liquidation
Event or out of the Available Proceeds (as defined below), as applicable, before any payment shall be made to the holders of Common Stock
by reason of their ownership thereof, an amount per share equal to the greater of the applicable Original Issue Price, plus any dividends
declared but unpaid thereon, or (ii) such amount per share as would have been payable had all shares of Preferred Stock been converted
into Common Stock immediately prior to such liquidation, dissolution, winding up or Deemed Liquidation Event (the amount payable pursuant
to this sentence is hereinafter referred to as the “Liquidation Amount”). If upon any such liquidation, dissolution or winding
up of the Corporation or Deemed Liquidation Event, the assets of the Corporation available for distribution to its stockholders shall
be insufficient to pay the holders of shares of Preferred Stock the full amount to which they shall be entitled under the Company’s
Certificate of Incorporation, the holders of shares of Preferred Stock shallshare ratably in any distribution of the assets available
for distribution in proportion to the respective amounts which would otherwise be payable in respect of the shares held by them upon
such distribution if all amounts payable on or with respect to such shares were paid in full.



As of December 31, 2021 and December 31,
2020 the share capital is composed of $0.00001 par value shares, as follows:



|                                        |  | December 31, 2021 |           
|--------------------------------------- |  | ----------------- | ----------
|                                        |  | Authorized        |           
|Common Shares                           |  |                   | 12,870,000
|Redeemable convertible preferred shares |  |                   | 170,000   



|                                        |  | December 31, 2020 |          
|--------------------------------------- |  | ----------------- | ---------
|                                        |  | Authorized        |          
|Common Shares                           |  |                   | 3,900,000
|Redeemable convertible preferred shares |  |                   | 40,000   



|*  | Adjusted to reflect stock splits        
|-- | ----------------------------------------
|** | Represents amount lower than $1,000 USD.



F-18







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 6 – REDEEMABLE CONVERTIBLE PREFERRED SHARES AND SHAREHOLDERS’
DEFICIT: (Continued):



Conversion
Rights —



Trigger Events — Upon either (a) the
closing of a Deemed Liquidation Event, (b) an initial public offering the Corporation’s securities on a major public stock
exchange (including, without limitation and for illustration purposes, the Nasdaq Stock Market’s National Market or the New York
Stock Exchange) resulting in at least $15,000,000 of proceeds to the Corporation, or (c) the vote or written consent of the majority
of the Preferred Stockholders (the time of such closing or the date and time specified or the time of the event specified in such vote
or written consent is referred to herein as the “Mandatory Conversion Time”), then (i) all outstanding shares of Preferred
Stock shall automatically be converted into shares of Common Stock, at the then effective conversion rate as calculated as follows —
each share of Preferred Stock shall be convertible, at the option of the holder thereof, at any time and from time to time, and without
the payment of additional consideration by the holder thereof, into such number of fully paid and non-assessable shares of Common Stock
as is determined by dividing the Original Issue Price ($119.0476) by the Conversion Price ($3.05 per share, subject to appropriate adjustment
in the event of any stock dividend, stock split, combination or other similar recapitalization or event with respect to the applicable
Preferred Stock). Such initial Conversion Price, and the rate at which shares of Preferred Stock may be converted into shares of Common
Stock, shall be subject to adjustment as detailed in the Company’s Certified of Incorporation in effect at the time of conversion
(as of December 31, 2021 the conversion is $3.05 per share) (ii) such shares may not be reissued by the Corporation.



Upon a successful IPO the convertible
preferred stock will be converted to common shares.



During February 2022 the company
completed the IPO and the convertible preferred stock were converted to common shares.



Rights to Future Stock Issuances —



Subject to the terms and conditions detailed
in the Company’s Certified of Incorporation and applicable securities laws, if the Corporation proposes to offer or sell any new
securities, the Corporation shall first offer such New Securities to each stockholder of the Corporation (each, an “Entitled Stockholder”).
An Entitled Stockholder shall be entitled to apportion the right of first offer hereby granted to it in such proportions as it deems
appropriate, among (i) itself, (ii) its Affiliates.



The Preferred Stock is not currently
redeemable. Upon certain change in control events that are outside of the Company’s control, including liquidation, sale or transfer
of control of the Company, the Preferred Stock is contingently redeemable.



F-19







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



| | c. | Rights of the Company’s common shares
| | -- | -------------------------------------



The holders of our common stock are entitled
to one vote for each share held on all matters submitted to a vote of the stockholders. The holders of our common stock do not have any
cumulative voting rights. Holders of our common stock are entitled to receive ratably any dividends declared by our board of directors
out of funds legally available for that purpose, subject to any preferential dividend rights of any outstanding preferred stock. The
Company’s common stock has no preemptive rights, conversion rights or other subscription rights or redemption or sinking fund provisions.



In the event of our liquidation, dissolution
or winding up, holders of the Company common stock will be entitled to share ratably in all assets remaining after payment of all debts
and other liabilities and any liquidation preference of any outstanding preferred stock.



As of December 31, 2021, no dividends
have been declared.



NOTE 7 – SHARE BASED PAYMENTS



| | a. | Share Based Payments
| | -- | --------------------



In May 2021, the Company’s
board of directors approved issuance of common shares in a total amount of 605,514 each with par value of $0.00001 per share including
amount of 238,914 to service providers and amount of 366,600 to related parties at estimated value of approximately $1.4 million (see
note 10). These common shares are fully vested on the grant date. The fair value of common shares was evaluated at the grant date using
hybrid pricing model with a combination of the Black-Scholes Option Pricing Model (OPM) and the P-WERM model for various possible scenarios.
For the various scenarios modeled, volatility is based on a combination of historical volatilities of companies in comparable stages
as well as companies in the industry by statistical analysis of daily share pricing model. The risk-free interest rate assumption is
based on observed interest rates appropriate for the time period until a liquidity event occurs. The expected term represents the period
of time until a liquidity event occurs.



The following
table summarizes assumptions used for the OPM model at the grant date:



|Risk-free interest rate  |  |  | 0.79 |  
|------------------------ |  |  | ---- | -
|Expected dividend yield  |  |  | -    |  
|Expected term (in years) |  |  | 4.9  |  
|Expected volatility      |  |  | 107  | %



| | b. | 2021 Incentive Plan
| | -- | -------------------



In May 2021, the Company’s
board of directors approved an equity incentive plan (hereafter — “Option Agreement”), in which the Company has reserved
a total amount of 408,486 common shares for issuance in connection with the Option Agreement.



In June 2021, the Company granted
to certain service providers 81,003 fully vested warrants and 8,190 warrants vesting upon the initial public offering, exercisable into
common shares with an exercise price of $3.05 per share. The 81,003 fully vested warrants have an estimated value (based on Black- Scholes
model) of approximately $136 thousand and were recognized as expenses in the period ended December 31, 2021.



F-20







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 7 – SHARE BASED PAYMENTS AND COMPENSATION
(continued)



| | b. | 2021 Incentive Plan (continued)
| | -- | -------------------------------



In July 2021, the Company granted
stock options to purchase 58,500 shares of common stock to two members of the Company’s Board of Directors and a warrant to purchase
11,700 shares of common stock to a certain service provider, vesting one month after the IPO. The options are exercisable into common
shares with an exercise price of $3.05 per share all vesting over a 3-year period. The stock options to purchase 58,500 shares of common
stock mentioned above have an estimated value (based on Black-Scholes model) of approximately $132 thousand for which $20 thousand were
recognized as expenses in the period ended December 31, 2021.



In addition, subject to the full discretion
of the Board of Directors, the Company will grant options annually, to each Board member, with an estimated value (based on the Black-Scholes
option pricing model) of approximately $150,000, with the first of such grants in to occur only upon the first Board meeting following
the consummation of the Company’s initial public offering. The Board of Directors will have full discretion with respect to the
annual grants.



In August 2021, the Company granted
to certain service providers stock options to purchase 138,840 common stock exercisable into common shares with an exercise price of
$3.05 per share, all vesting over a 3-year period and with an estimated value (based on Black-Scholes model) of approximately $306 thousand
which $33 thousand were recognized as expenses in the period ended December 31, 2021.



In September 2021, the Company granted
to an employee 15,600 RSU’s and 29,250 stock options to a Company’s board of director member exercisable into common shares
with an exercise price of $3.05 per share, all vesting over a 3-year period and with an estimated value (based on Black-Scholes model)
of approximately $38 thousand and $74 thousand, respectively, which $8 thousand and $10 thousand, respectively, were recognized as expended
in the period ended December 31, 2021.



In October 2021, the Company granted
to an employee 4,680 RSUs, all vesting over a 3-year period and with an estimated value (based on Black-Scholes model) of approximately
$11 thousand which $1.4 thousand were recognized as expended in the period ended December 31, 2021.



In November 2021, the Company granted
to an employee 27,300 RSUs, all vesting over a 3-year period and with an estimated value (based on Black-Scholes model) of approximately
$65 thousand which $7 thousand were recognized as expended in the period ended December 31, 2021.



The following table summarizes the Company’s
stock option activity for the year ended December 31, 2021, as described above:



|                                                  |  | Number
    of shares under option |         |  | Weighted
    average Exercise price per Option |  |        | Weighted
    average remaining  life |  |  | Aggregated
    Intrinsic value (in thousands) | 
|------------------------------------------------- |  | --------------------------------- | ------- |  | ---------------------------------------------- |  | ------ | ------------------------------------ |  |  | --------------------------------------------- | 
|Granted                                           |  |                                   | 226,590 |  |                                                |  | 3.0526 |                                      |  |  |                                               | 
|Exercised                                         |  |                                   | -       |  |                                                |  | -      |                                      |  |  |                                               | 
|Forfeited                                         |  |                                   | -       |  |                                                |  | -      |                                      |  |  |                                               | 
|Outstanding – December 31, 2021                   |  |                                   | 226,590 |  |                                                |  | 3.0526 |                                      |  |  | 9.067                                         | 
|Exercisable – December 31, 2021                   |  |                                   | -       |  |                                                |  | -      |                                      |  |  | -                                             | 
|Vested or Expected to vest -December 31,
    2021 |  |                                   | 226,590 |  |                                                |  | 3.0526 |                                      |  |  | 9.067                                         | 



F-21







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 7 – SHARE BASED PAYMENTS AND COMPENSATION
(continued)



| | b. | 2021 Incentive Plan (continued)
| | -- | -------------------------------



As of December 31, 2021, there was
$0.3 million of unrecognized stock-based compensation expense related to unvested stock options that is expected to be recognized over
a weighted-average period of 2.5 years, excluding warrants which vest upon completion of an IPO.



The fair value of each option granted
is estimated using the Black-Scholes option pricing method. The volatility is based on a combination of historical volatilities of companies
in comparable stages as well as companies in the industry by statistical analysis of daily share pricing model. The risk-free interest
rate assumption is based on observed interest rates appropriate for the expected term of the options granted in dollar terms. The expected
term of the options granted represents the period of time that the granted options are expected to remain outstanding based on common
practice in the industry.



Common share price is calculated using
the model described. The following table summarizes the Black-Scholes assumptions used at the grant date:



|                         |  |  | Grant
                                            Dates May –
                                            November 2021 | 
|------------------------ |  |  | ----------------------------------------------------------------------------------------------------------------------- | 
|Risk-free interest rate  |  |  | 0.80%
                                            - 1.37%                                                               | 
|Expected dividend yield  |  |  | —                                                                                                                       | 
|Common share price       |  |  | $2.28
                                            - $2.97                                                               | 
|Expected term (in years) |  |  | 5
                                            – 10                                                                      | 
|Expected volatility      |  |  | 88% – 107%                                                                                                              | 



Restricted stock Units



Restricted stock units (RSUs) have been
granted to employees and directors. The value of an RSU award is based on the Company’s stock price on the date of grant using
hybrid pricing model with a combination of the Black-Scholes Option Pricing Model (OPM) and the P-WERM model for various possible scenarios.
The shares underlying the RSU awards are not issued until the RSUs vest. Upon vesting, each RSU converts into one share of the Company’s
common stock. The Company has granted RSUs pursuant to the 2021 plan.



The following table summarizes the Company’s
restricted stock unit activity for the year ended December 31, 2021, as described above from the 2021 Incentive Plan:



|                                              |  | Number of shares
    under option |        |  | Weighted average
    grant date fair value |  |        | Weighted average
    contractual term (in years) |  |  | Aggregated Intrinsic
    value (in thousands) | 
|--------------------------------------------- |  | --------------------------------- | ------ |  | ------------------------------------------ |  | ------ | ------------------------------------------------ |  |  | --------------------------------------------- | 
|Granted                                       |  |                                   | 47,580 |  |                                            |  | 2.4907 |                                                  |  |  |                                               | 
|Vested                                        |  |                                   | -      |  |                                            |  | -      |                                                  |  |  |                                               | 
|Outstanding – December 31, 2021               |  |                                   | 47,580 |  |                                            |  | 2.4907 |                                                  |  |  | 2.7158                                        | 
|Vested or Expected to vest -December 31, 2021 |  |                                   | 47,580 |  |                                            |  | 2.4907 |                                                  |  |  | 2.7158                                        | 



As of December 31, 2021, there was
$0.1 million of total unrecognized compensation cost related to RSUs that is expected to be recognized over a weighted average period
of 2.7 years.



The total fair value of RSUs vested for
the year ended December 31, 2021, was zero.



F-22







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 7 – SHARE BASED PAYMENTS AND COMPENSATION
(continued)



| | c. | Share compensation expense
| | -- | --------------------------





For the period ended December 31,
2021, the company recognized expenses of $1.0 million as part of the general and administrative expenses and $0.9 million as part of
the research and development expenses.



NOTE 8 – NET LOSS PER SHARE:



| | a. | Basic
| | -- | -----



Basic net loss per share is calculated
by dividing the net loss attributable to the Company’s stockholders by the weighted average number of common shares outstanding.



|                                             |  | For
    the year ended
    December 31, 2021                    |           |  | Period
    from July 27
    (inception), 2020 to December
     31, 2020 | 
|-------------------------------------------- |  | --------------------------------------------------------------- | --------- |  | ----------------------------------------------------------------------- | 
|                                             |  | in thousand U.S. dollars
    except per share and share amounts |          
|Loss attributable to common stockholders     |  |                                                                 | 12,890    |  |                                                                         | 
|Basic and diluted net loss per common share  |  |                                                                 | 3.02      |  |                                                                         | 
|Weighted average of common share outstanding |  |                                                                 | 4,268,285 |  |                                                                         | 



Basic loss per share is calculated by
dividing the result attributable to equity holders of the Company by the weighted average number of Ordinary Shares in issue during the
year.



| | b. | Diluted
| | -- | -------



As of December 31, 2021 and December 31,
2020, the Company excluded potentially dilutive securities from the calculation of diluted net loss per Ordinary Share because their
effects would have been anti-dilutive (see note 2n).



NOTE
9 – INCOME TAXES:



| | a. | The
                                            Company has not recorded an income tax benefit for the years ended December 31, 2021
                                            and 2020, respectively. The Company has incurred net pre-tax losses in the United States
                                            only for all periods presented. Deferred tax assets and liabilities are recognized for the
                                            future tax consequences attributable to the differences between the carrying amounts of existing
                                            assets and liabilities in the financial statements and their respective tax bases using tax
                                            rates expected to be in effect during the years in which the basis differences reverse.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-23







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE
9 – INCOME TAXES (continued):



| | b. | Tax
                                            Rates:
| | -- | ------------------------------------------------------



Income of the Company is taxed according
to the federal tax laws in the US and the relevant state laws. The U.S tax rate in 2021 and 2020 is 28% comprising U.S statutory tax
rates of 21% and state tax rate of 7%. For the years ended December 31, 2021 and the period ended December 31, 2020, the Company’s
effective tax rate is below the federal statutory income tax rate of 21% primarily due to state income taxes, net of federal benefit
and the Company’s position to establish a full valuation allowance on its deferred tax assets.



| | c. | Corporate
                                            Taxation in the U.S.
| | -- | --------------------------------------------------------------------------



The applicable corporate tax rate for the Company is 21%.



As of December 31, 2021, the Company
has an accumulated tax loss carryforward of approximately $9,283 (as of December 31, 2020, $10). Under U.S. tax laws, subject to
certain limitations, carryforward tax losses originating in tax years beginning after January 1, 2018, have no expiration date,
but they are limited to 80% of the company’s taxable income in any given tax year.



| | d. | Tax
                                            Assessments
| | -- | -----------------------------------------------------------



The company has not been taxed since
its inception.



| | e. | Deferred
                                            Taxes
| | -- | ----------------------------------------------------------



The
tax effect of temporary differences and carryforwards that give rise to significant portions of the deferred tax assets and liabilities
are presented below:



|                                 |  | As
of
 December 31, 2021
 (in thousands USD) |        |   | As
of
 December 31, 2020
 (in thousands USD) | 
|-------------------------------- |  | -------------------------------------------- | ------ | - | -------------------------------------------- | 
|Deferred tax asset:              |  |                                              |        |   |                                              | 
|Net operating loss carry forward |  |                                              | 2,500  |   |                                              | 
|Share Compensation               |  |                                              | 510    |   |                                              | 
|Research and Development credits |  |                                              | 26     |   |                                              | 
|Accruals and reserves            |  |                                              | 435    |   |                                              | 
|Total deferred tax assets        |  |                                              | 3,471  |   |                                              | 
|Valuation allowance              |  |                                              | (3,471 | ) |                                              | 
|Deferred tax assets recognized   |  |                                              | --     |   |                                              | 



F-24







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE
9 – INCOME TAXES (continued):



As
the achievement of required future taxable income is not likely, the Company recorded a full valuation allowance. The following
table presents a reconciliation of the beginning and ending valuation allowance:



|                                 |  | As
    of
    December 31, 2021
    (in thousands USD) |       |  | As
    of
    December 31, 2020
    (in thousands USD) | 
|-------------------------------- |  | ------------------------------------------------------ | ----- |  | ------------------------------------------------------ | 
|Balance at beginning of the year |  |                                                        | 10    |  |                                                        | 
|Additions to valuation allowance |  |                                                        | 3,461 |  |                                                        | 
|Release of valuation allowance   |  |                                                        | --    |  |                                                        | 
|                                 |  |                                                        |       |  |                                                        | 
|Balance at end of the year       |  |                                                        | 3,471 |  |                                                        | 



NOTE 10 – Related party transactions:



| | a. | Regarding
                                            related party transaction events, please also see note 6b and note 7a.
| | -- | ----------------------------------------------------------------------------------------------------------------------------



| | b. | Indemnification
| | -- | ---------------



The Company
currently has directors’ and officers’ insurance coverage that reduces its exposure and enables the Company to recover a
portion of any future amounts paid. The Company believes the estimated fair value of these indemnification agreements in excess of applicable
insurance coverage is minimal.



| | c. | The
                                            following are the equity awards for the executive officers:
| | -- | -----------------------------------------------------------------------------------------------------------



Ron Bentsur



Equity Awards



Executive will be eligible for grants
of equity awards under the Company's long-term equity incentive plan.  On the Effective Date, the Company shall award the following
to the Executive:



| | · | Restricted
                                            shares of common stock upon the consummation of the earlier of (a) IPO raising at least
                                            US $15M in gross proceeds, or (b) capital raising of at least US $15M in a private equity
                                            financing, equal to 1% of the fully-diluted share count immediately preceding such IPO/financing
                                            event. Such shares will vest and become fully exercisable on the first anniversary of
                                            the offering or financing event; and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Fully
                                            vested shares of common stock equal to 1% of the then fully diluted share count of the Company
                                            when the Company reaches an average market capitalization over a 30-day period of $350 million
                                            or higher.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



While the funding condition has been
achieved during the year ended December 31, 2021, the market capitalization has not been achieved. This resulted in 96,759 RSU being
granted in May 2021 and vesting in July 2022.



F-25







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE 10 – Related party transactions (continued):



Enrique Poradosu



Equity Awards



Executive will be eligible for grants
of equity awards under the Company’s long-term equity incentive plan.  On the Effective Date, the Company shall award the
following to the Executive:



| | · | Restricted
                                            shares of common stock upon the consummation of the earlier of (a) IPO raising at least
                                            US $15M in gross proceeds, or (b) capital raising of at least US $15M in a private equity
                                            financing, equal to 0.5% of the fully-diluted share count immediately preceding such IPO/financing
                                            event. Such shares will vest and become fully exercisable on the first anniversary of
                                            the offering or financing event; and
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Fully
                                            vested shares of common stock equal to 0.5% of the then fully diluted share count of the
                                            Company when the Company reaches an average market capitalization over a 30-day period of
                                            $350 million or higher.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



While the funding condition has been
achieved during the year ended December 31, 2021, the market capitalization has not been achieved. This resulted in 48,399 RSU being
granted in May 2021 and vesting in July 2022.



Shay Shemesh



Equity Awards



Executive will be eligible for grants
of equity awards under the Company’s long-term equity incentive plan.  On the Effective Date, the Company shall award the
following to the Executive:



| | · | Restricted
                                            shares of common stock upon the consummation of the earlier of (a) IPO raising at least
                                            US $15M in gross proceeds, or (b) capital raising of at least US $15M in a private equity
                                            financing, equal to 0.5% of the fully-diluted share count immediately preceding such IPO/financing
                                            event. Such shares will vest and become fully exercisable on the first anniversary of
                                            the offering or financing event; and
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Fully
                                            vested shares of common stock equal to 0.5% of the then fully diluted share count of the
                                            Company when the Company reaches an average market capitalization over a 30-day period of
                                            $350 million or higher.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



While the funding condition has been
achieved during the year ended December 31, 2021, the market capitalization has not been achieved. This resulted in 48,399 RSU being
granted in May 2021 and vesting in July 2022.



F-26







NUVECTIS PHARMA, INC.



Notes to the Financial Statements (continued)



NOTE
11 –SUBSEQUENT EVENTS:



| | a. | Initial Public Offering and Related Transaction
| | -- | -----------------------------------------------



On February 8, 2022, the Company
issued and sold 3,200,000 shares of common stock in the IPO at a public offering price of $5.00 per share, and received net proceeds
$13.6 million, after underwriting discounts and commissions, of $1.1 million and expenses of $1.3 million.



In connection with the IPO, all 128,520
shares of redeemable convertible preferred stock outstanding at the time of the IPO converted into 5,012,280 shares of the Company’s
common stock.



F-27







(b)Exhibits.



|Exhibit No. |   | Description                                                                                                                                                                                                                                      
|----------- | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1         |   | Second
    Amended and Restated Certificate of Incorporation of Nuvectis Pharma, Inc., filed as exhibit 3.1 to the Form 8-K filed
    on February 4, 2022 and incorporated herein by reference.                                                  
|            |   |                                                                                                                                                                                                                                                  
|3.2         |   | Certificate
    of Amendment to the Second Amended and Restated Certificate of Incorporation of Nuvectis Pharma, Inc., filed as exhibit 3.3
    to the Form 8-K filed on February 4, 2022 and incorporated herein by reference.                  
|            |   |                                                                                                                                                                                                                                                  
|3.3         |   | Amended
    and Restated Bylaws of Nuvectis Pharma, Inc., filed as exhibit 3.2 to the Form 8-K filed on February 4, 2022 and incorporated
    herein by reference.                                                                               
|            |   |                                                                                                                                                                                                                                                  
|4.1         | ​ | Form of
    Common Stock Certificate, filed as exhibit 4.1 to the Form S-1/A, filed on October 21, 2021 and incorporated herein by
    reference.                                                                                                
|            |   |                                                                                                                                                                                                                                                  
|4.2         |   | Form of
    Warrant, filed as exhibit 4.2 to the Form S-1/A filed on October 28, 2021 and incorporated herein by reference.                                                                                                                      
|            |   |                                                                                                                                                                                                                                                  
|4.3         |   | Description
    of Securities of Nuvectis Pharma, Inc. *                                                                                                                                                                                         
|            |   |                                                                                                                                                                                                                                                  
|10.1        |   | Global
    Equity Incentive Plan, filed as exhibit 10.1 to the Form S-1/A filed on October 6, 2021 and incorporated herein by reference.                                                                                                         
|            |   |                                                                                                                                                                                                                                                  
|10.2        |   | Executive
    Employment Agreement with Ron Bentsur, filed as exhibit 10.2 to the Form S-1/A filed on October 6, 2021 and incorporated
    herein by reference. #                                                                                
|            |   |                                                                                                                                                                                                                                                  
|10.3        |   | Executive
    Employment Agreement with Enrique Poradosu, filed as exhibit 10.3 to the Form S-1/A filed on October 6, 2021 and incorporated
    herein by reference. #                                                                           
|            |   |                                                                                                                                                                                                                                                  
|10.4        |   | Executive
    Employment Agreement with Shay Shemesh, filed as exhibit 10.4 to the Form S-1/A filed on October 6, 2021 and incorporated
    herein by reference. #                                                                               
|            |   |                                                                                                                                                                                                                                                  
|10.5        |   | License
    Agreement between Nuvectis Pharma, Inc. and CRT Pioneer Fund LP dated May 19, 2021, filed as exhibit 10.5 to the Form S-1/A
    filed on October 6, 2021 and incorporated herein by reference. **                                    
|            |   |                                                                                                                                                                                                                                                  
|10.6        |   | License
    Agreement between Nuvectis Pharma, Inc. and The University Court of the University of Edinburgh, dated August 26, 2021,
    filed as exhibit 10.6 to the Form S-1/A filed on October 6, 2021 and incorporated herein by reference. **
|            |   |                                                                                                                                                                                                                                                  
|21.1        |   | List
    of subsidiaries of Nuvectis Pharma, Inc. *                                                                                                                                                                                              
|            |   |                                                                                                                                                                                                                                                  
|24.1        |   | Power
    of Attorney (included on signature page). *                                                                                                                                                                                            
|            |   |                                                                                                                                                                                                                                                  
|31.1        |   | Certification
    of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *                                                                                                                                    



|31.2 |  | Certification
    of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
|---- |  | -------------------------------------------------------------------------------------------------------------
|     |  |                                                                                                              
|32.1 |  | Certification
    of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *
|     |  |                                                                                                              
|32.2 |  | Certification
    of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *



70







|*  | Filed herewith.                                                                                      
|-- | -----------------------------------------------------------------------------------------------------
|** | Certain portions of this
    exhibit have been omitted pursuant to Item 601(b)(10) of Regulation S-K.
|#  | Management Compensation
    Arrangement.                                                             



|Item
    16. | Form 10-K Summary
|------------ | -----------------



The Company has elected not to provide summary
information.



71









Signatures



Pursuant to the requirements
of the Securities Act of 1933, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Fort Lee, State of New Jersey, on this 23rd day of March 2022.



| | Nuvectis Pharma, Inc.
| | ---------------------
| |                      
| | By:                  
| |                      
| |                      



POWER OF ATTORNEY



We, the undersigned
directors and/or executive officers of Nuvectis Pharma, Inc., hereby severally constitute and appoint Ron Bentsur, acting singly,
his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him or her in any and
all capacities, to sign this report and to file the same, with all exhibits thereto and other documents in connection therewith, with
the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each
and every act and thing necessary or appropriate to be done in connection therewith, as fully for all intents and purposes as he or she
might or could do in person, hereby approving, ratifying and confirming all that said attorney-in-fact and agent, or his substitute,
may lawfully do or cause to be done by virtue hereof.



Pursuant to the requirements
of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in
the capacities and on the dates indicated.



|Signature                | ​ | Title                                               | ​ | Date           | ​
|------------------------ | - | --------------------------------------------------- | - | -------------- | -
|                         |   |                                                     |   |                |  
|/s/ Ron Bentsur          |   | Chairman, Chief Executive
    Officer and President |   | March 23, 2022 |  
|Ron Bentsur              |   | (Principal Executive Officer)                       |   |                |  
|                         |   |                                                     |   |                |  
|/s/ Michael J Carson     |   | Vice President of Finance                           |   | March 23, 2022 |  
|Michael J Carson         |   | (Principal Financial and Accounting Officer)        |   |                |  
|                         |   |                                                     |   |                |  
|/s/ Kenneth Hoberman     |   |                                                     |   |                |  
|Kenneth Hoberman         |   | Director                                            |   | March 23, 2022 |  
|                         |   |                                                     |   |                |  
|/s/ James F. Olivero III |   |                                                     |   |                |  
|James F. Oliviero III    |   | Director                                            |   | March 23, 2022 |  
|                         |   |                                                     |   |                |  
|/s/ Matthew L. Kaplan    |   |                                                     |   |                |  
|Matthew L. Kaplan        |   | Director                                            |   | March 23, 2022 |