# EDGAR Filing Document

**Accession Number:** 0001659617
**File Stem:** 0001437749-26-008841
**Filing Date:** 2026-3
**Character Count:** 598852
**Document Hash:** 2cfa944e72d1123bce15cfc6df6b4ac8
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001437749-26-008841.hdr.sgml**: 20260318

**ACCESSION NUMBER**: 0001437749-26-008841

**CONFORMED SUBMISSION TYPE**: 10-K

**PUBLIC DOCUMENT COUNT**: 73

**CONFORMED PERIOD OF REPORT**: 20251231

**FILED AS OF DATE**: 20260318

**DATE AS OF CHANGE**: 20260318

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Moleculin Biotech, Inc.
- **CENTRAL INDEX KEY:** 0001659617
- **STANDARD INDUSTRIAL CLASSIFICATION:** PHARMACEUTICAL PREPARATIONS [2834]
- **ORGANIZATION NAME:** 03 Life Sciences
- **EIN:** 474671997
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-37758
- **FILM NUMBER:** 26768919

**BUSINESS ADDRESS:**
- **STREET 1:** 5300 MEMORIAL DRIVE
- **STREET 2:** SUITE 950
- **CITY:** HOUSTON
- **STATE:** TX
- **ZIP:** 77007
- **BUSINESS PHONE:** 713-300-5160

**MAIL ADDRESS:**
- **STREET 1:** 5300 MEMORIAL DRIVE
- **STREET 2:** SUITE 950
- **CITY:** HOUSTON
- **STATE:** TX
- **ZIP:** 77007

?xml version='1.0' encoding='ASCII'? mbrx20251231_10k.htm

[**Table of Contents**](#toc)

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM 10-K**

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

For the fiscal year ended **December 31, 2025**

**or**

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

&nbsp;&nbsp;&nbsp;&nbsp;**For the transition period from** <u>**&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**</u> **to** <u>**&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**</u>

Commission File Number: **001-37758**

**Moleculin Biotech, Inc.**

(Exact name of registrant as specified in its charter)

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| | |
|:---|:---|
| **Delaware** | **47-4671997** |
| (State or Other Jurisdiction of | (I.R.S. Employer |
| Incorporation or Organization) | Identification Number) |

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**5300 Memorial Drive, Suite 950**

**Houston, Texas 77007**

**(713) 300-5160**

(Address of Principal Executive Offices, Zip Code and Registrant's Telephone Number)

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

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| | | |
|:---|:---|:---|
| **Title of Each Class** | **Trading Symbol (s)** | **Name of Each exchange on which registered** |
| Common Stock, par value $0.001 per share | MBRX | Nasdaq Stock Market LLC |

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**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.&nbsp;&nbsp;&nbsp;&nbsp;Yes ☐&nbsp;&nbsp;&nbsp;&nbsp;No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.&nbsp;&nbsp;&nbsp;&nbsp;Yes ☐&nbsp;&nbsp;&nbsp;&nbsp;No ☒

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 periods as the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.&nbsp;&nbsp;&nbsp;&nbsp;Yes ☒&nbsp;&nbsp;&nbsp;&nbsp;No ☐

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

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

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| | |
|:---|:---|
| Large accelerated filer ☐ | |
| Non-accelerated filer ☒ | Smaller reporting company ☒ |
| Accelerated filer&nbsp;&nbsp;&nbsp;&nbsp;☐ | Emerging growth company ☐ |

---

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

Indicate by check mark whether the registrant 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 USC. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to § 240.10D-1(b). ☐

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

The aggregate market value of the registrant's voting equity held by non-affiliates of the registrant, computed by reference to the price at which the common stock was last sold as of the last business day of the registrant's most recently completed second fiscal quarter, was $8.8 million. In determining the market value of the voting equity held by non-affiliates, securities of the registrant beneficially owned by directors, officers and 10% or greater shareholders of the registrant have been excluded. This determination of affiliate status is not necessarily a conclusive determination for other purposes. The number of shares of the registrant's common stock outstanding as of March 11, 2026 was 5,336,350.

**DOCUMENTS INCORPORATED BY REFERENCE**

Portions of this registrant's definitive proxy statement for its 2026 Annual Meeting of Stockholders to be filed with the SEC no later than 120 days after the end of the registrant's fiscal year are incorporated herein by reference in Part III of this Annual Report on Form 10-K.

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[**Table of Contents**](#toc)

**Moleculin Biotech, Inc.**

**Table of Contents**

---

| | |
|:---|:---|
| [**PART I**](#part1) | [**PART I**](#part1) |
| [**Item 1. Business**](#item1) | [3](#item1) |
| [**Item 1A. Risk Factors**](#item1a) | [26](#item1a) |
| [**Item 1B. Unresolved Staff Comments**](#item1b) | [52](#item1b) |
| [**Item 1C. Cybersecurity**](#item1ccybersecurity) | [53](#item1ccybersecurity) |
| [**Item 2. Properties**](#item2) | [53](#item2) |
| [**Item 3. Legal Proceedings**](#item3) | [53](#item3) |
| [**Item 4. Mine Safety Disclosure**](#item4) | [53](#item4) |
| [**PART II**](#part2) | [**PART II**](#part2) |
| [**Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities**](#item5) | [54](#item5) |
| [**Item 6. \[Reserved\]**](#item6) | [54](#item6) |
| [**Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations**](#item7) | [54](#item7) |
| [**Item 7A. Quantitative and Qualitative Disclosures About Market Risk**](#item7a) | [61](#item7a) |
| [**Item 8. Financial Statements and Supplementary Data**](#item8) | [61](#item8) |
| [**Item 9. Change in and Disagreements with Accountants on Accounting and Financial Disclosures**](#item9) | [61](#item9) |
| [**Item 9A. Controls and Procedures**](#item9a) | [61](#item9a) |
| [**Item 9B. Other Information**](#item9b) | [61](#item9b) |
| [**<u>Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.</u>**](#item9c) | [62](#item9c) |
| [**PART III**](#part3) | [**PART III**](#part3) |
| [**Item 10. Directors, Executive Officers and Corporate Governance**](#item10) | [62](#item10) |
| [**Item 11. Executive Compensation**](#item11) | [62](#item11) |
| [**Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters**](#item12) | [62](#item12) |
| [**Item 13. Certain Relationships and Related Transactions and Director Independence**](#item13) | [62](#item13) |
| [**Item 14. Principal Accountant Fees and Services**](#item14) | [62](#item14) |
| [**PART IV**](#part4) | [**PART IV**](#part4) |
| [**Item 15. Exhibits and Financial Statement Schedules**](#item15) | [62](#item15) |
| [**Item 16. Form 10-K Summary**](#item16) | [65](#item16) |
| [**Signatures**](#sigs) | [66](#sigs) |

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[**Table of Contents**](#toc)

**Moleculin Biotech, Inc.**

**CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS**

The Securities and Exchange Commission, referred to herein as the SEC, encourages companies to disclose forward-looking information so that investors can better understand a company's future prospects and make informed investment decisions. Certain statements that we may make from time to time, including, without limitation, statements contained in this report constitute "forward- looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995.

We make forward-looking statements under the "Risk Factors," "Business," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and in other sections of this report. In some cases, you can identify these statements by forward-looking words such as "may," "might," "should," "would," "could," "expect," "plan," "anticipate," "intend," "believe," "estimate," "predict," "potential" or "continue," and the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to known and unknown risks, uncertainties and assumptions about us, may include projections of our future financial performance based on our growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements. In particular, you should consider the numerous risks and uncertainties described under "Risk Factors."

While we believe we have identified material risks, these risks and uncertainties are not exhaustive. Other sections of this report describe additional factors that could adversely impact our business and financial performance. Moreover, we operate in a very highly regulated, competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible to predict all risks and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy or completeness of any of these forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. We are under no duty to update any of these forward-looking statements after the date of this report to conform our prior statements to actual results or revised expectations, and we do not intend to do so.

Forward-looking statements include, but are not limited to, statements about:

• Our ability to continue our relationship with MD Anderson, including, but not limited to, our ability to maintain current licenses and license future intellectual property resulting from our sponsored research agreements with MD Anderson;

• The success or the lack thereof, including the ability to recruit subjects on a timely basis, for a variety of reasons, of our clinical trials through all phases of clinical development;

• Our ability to satisfy any requirements imposed by the United States (US) Food and Drug Administration (FDA) (or its foreign equivalents) as a condition of our clinical trials proceeding or beginning as planned;

• World-wide events including the wars in Ukraine and in the Middle East, and the general supply chain shortage effects on our clinical trials, clinical drug candidate supplies, preclinical activities and our ability to raise future financing;

• Our ability to obtain additional funding on a timely basis to commence or continue our clinical trials, fund operations and develop our product candidates;

• The need to obtain and retain regulatory approval of our drug candidates, both in the United States and in Europe, and in countries deemed necessary for future trials;

• Our ability to complete our clinical trials in a timely fashion in line with our stated milestones and within our expected budget and resources;

• Our ability to maintain compliance with the continued listing requirements of the Nasdaq Capital Market;

• Our ability to source our drug products timely and at reasonable prices;

• Compliance with obligations under intellectual property licenses with third parties;

• Any delays in regulatory review and approval of drug candidates in clinical development;

• Potential efficacy of our drug candidates;

• Our ability to commercialize our drug candidates;

• Market acceptance of our drug candidates;

• Competition from existing therapies or new therapies that may emerge;

• Potential product liability claims;

• Our dependency on third-party manufacturers to successfully, and timely, supply or manufacture our drug candidates for our preclinical work and our clinical trials;

• Our ability to establish or maintain collaborations, licensing or other arrangements;

• Our ability and third parties' abilities to protect intellectual property rights;

• Our ability to adequately support future growth; and

• Our ability to attract and retain key personnel to manage our business effectively.

We caution you not to place undue reliance on the forward-looking statements, which speak only as of the date of this Form 10-K in the case of forward-looking statements contained in this Form 10-K.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2

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[**Table of Contents**](#toc)

**PART I**

 

*References in this Annual Report on Form 10-K to "MBI", "Moleculin" or "the Company", "we", "our" and "us" are used herein to refer to Moleculin Biotech, Inc.*

**ITEM 1. BUSINESS**

**<u>BUSINESS</u>**

**Business Summary**

We are a late-stage pharmaceutical development company currently evaluating Annamycin, also known as L-Annamycin and by its generic name "naxtarubicin", which we believe is a "next-generation" anthracycline and, with it, are conducting a pivotal Phase 3 trial in combination with cytarabine for the treatment of subjects with relapsed/refractory (R/R) acute myeloid leukemia (AML). We call this the "MIRACLE" trial (derived from Moleculin R/R AML AnnAraC Clinical Evaluation). A blinded preliminary data readout has been released for the MIRACLE trial, and we expect to have an interim unblinding of data in mid-2026 and an additional unblinding in the second half of 2026, thereby concluding Part A of the two-part trial. We believe such early visibility for a pivotal registration-enabling trial is unique in that stakeholders will receive preliminary safety and efficacy data long before the conclusion of the trial.

We have two additional portfolios of technologies for hard-to-treat cancers and viruses with clinical and preclinical research funded by investigators at academic institutions. One of these portfolios has an ongoing investigator-initiated trial, another one planned and additional active preclinical testing. Since our inception, drug candidates from each of the three core portfolios are in active planning for, have approval to begin, are currently in or have successfully completed eighteen clinical trials.

Each of our three core technologies is based substantially on discoveries made at, made in conjunction with, and/or licensed from the University of Texas MD Anderson Cancer Center (MD Anderson) in Houston, Texas. For each of the core technologies, one or more drug candidates have successfully completed a Phase 1 or greater clinical trial. Three of our drug candidates have shown human activity in clinical trials and are currently or have been in Phase 1B/2, Phase 2, or Phase 2B/3 clinical trials. One of those drug candidates is Annamycin, which is currently in the MIRACLE trial.

We believe Annamycin is the first of its kind DNA binding agent, a "next-generation" anthracycline. Whereas first- and second-generation anthracyclines are currently used to treat approximately half of all cancers, they carry with them the burden of dangerous cardiotoxicity and efficacy limitations associated with multidrug resistance mechanisms and poor tissue/organ distribution. Later generation anthracyclines are comprised mainly of attempts to reduce cardiotoxicity or enhance anticancer activity but we believe have failed to deliver the necessary safety and efficacy profiles to win approval or gain market acceptance. Annamycin is an entirely new chemical entity integrating a new molecular structure intended to enhance its ability to selectively kill cancer cells and reduce toxic side effects. Annamycin possesses a unique and innovative multilamellar lipid-based delivery system designed to improve bioavailability and to increase the therapeutic window. The result is a next-generation anthracycline that we believe effectively addresses critical problems associated with currently used anthracyclines. It is our lead drug candidate, and we have concluded a Phase 1B/2 clinical trial for treating AML and are now conducting a Phase 3 clinical trial for R/R AML, which we believe will be registration enabling. We have also sponsored two Phase 1B/2 clinical trials of Annamycin for treating Soft Tissue Sarcoma metastasized to the lungs (STS lung metastases, STS lung mets, or Advanced STS), the results of which we believe supports the initiation of a pivotal approval trial in this additional indication.

We believe that our lead drug candidate Annamycin has:

● The following advantages over early-generation anthracyclines which in their totality support Annamycin's classification as a "next-generation" anthracycline: 1) demonstrated across five clinical trials to be non-cardiotoxic (n=90) with some patients being safely dosed at five times the typical lifetime maximum allowable anthracycline dose, (which potentially enables repeated dosing, consolidation and even use as a maintenance therapy); 2) exhibits no vesicant activity as well as greater tolerability, making it safer to handle and administer and easier on patients; 3) shown in preclinical models to circumvent multidrug resistance by avoiding MDR1 mechanisms and also to avoid cross-resistance with some of the most commonly used drugs for the treatment of AML (as well as many other cancers), including currently approved early-generation anthracyclines, cytarabine and venetoclax and, 4) exhibited in preclinical models substantially improved tissue/organ distribution;

● Demonstrated a complete remission (CR) rate of 50% and a composite complete remission (CRc) rate of 60% in combination with Cytarabine for the treatment of R/R AML as second line therapy (n=10). On an all comer's basis (no limit on prior lines of therapy), the population of subjects who achieved a CR (n=8) demonstrated durability of approximately 13 months with median overall survival of 15 months and developing at the time of analysis, with 4 of 8 subjects (50%) censored;

● Shown promising blinded safety and efficacy data for the first 30 subjects treated in the MIRACLE trial as we head towards the planned interim unblinding of data for the first 45 subjects treated with efficacy data in Part A of the MIRACLE trial in mid-2026;

● Shown encouraging activity in a total of five different clinical trials (most of which are now complete), funded both internally and externally (through investigator-initiated trials); specifically including relapsed and refractory AML with complete remission rates significantly above currently approved second line therapies and STS lung mets with overall survival as a median seventh line therapy comparable to overall survival seen with approved first line monotherapies; and 

● Obtained composition of matter patent protection through 2040 with the potential to extend as far as 2045 as well as Orphan Drug and Fast Track designation. 

One of our core management beliefs is that anthracyclines represent one of the most important treatments available for AML and Advanced STS, as well as many other cancers, and we believe Annamycin may, for the first time ever, allow a majority of these patients to benefit from Annamycin's improved safety and efficacy by allowing increased dosing (and even maintenance dosing), improved tolerability and allowing access for patients who otherwise would not be eligible for an anthracycline (including the elderly and those with impaired cardiac function). We believe that such benefits will be disruptive to the competitive landscape for these markets. This belief, coupled with our limited resources, leads us to currently focus mainly on the development of Annamycin. We seek to advance our other drug candidates via investigator led studies, both clinically and preclinically, and as available resources will allow.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3

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<u>Core Technologies and Focus</u>

Our core technologies consist of the following programs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Annamycin is what we believe to be a "next-generation" anthracycline (one of the most widely used classes of chemotherapy), designed to be different than currently approved anthracyclines, which are limited in utility because of cardiotoxicity risks, tolerability, their susceptibility to multidrug resistance mechanisms and a lack of efficacy in certain tumor models.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Our WP1066 Portfolio includes WP1066, WP1193 and WP1220, three of several Immune/Transcription Modulators in the portfolio designed to inhibit p-STAT3 (phosphorylated signal transducer and activator of transcription) among other transcription factors associated with tumor activity. These also stimulate a natural immune response to tumors by inhibiting the errant activity of Regulatory T-Cells (TRegs).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Our WP1122 Portfolio contains compounds (including WP1122, WP1096, and WP1097) designed to exploit the potential uses of inhibitors of glycolysis such as 2-deoxy-D-glucose (2-DG). We believe such compounds may provide an opportunity to cut off the energy supply of tumors by taking advantage of their high degree of dependence on glucose in comparison to healthy cells, as well as viruses that also depend upon glycolysis and glycosylation to infect and replicate.

<u>Our Current Clinical Trial Focus</u>

We are focused on Annamycin and WP1066 program's internally and externally funded ("internally" and "externally" funded trials are defined in the Funding Strategy section below) development of our core technologies as follows:

1. Annamycin:

a. Internally funded – In combination with Cytarabine (also known as Ara-C, the combination with Annamycin of which is referred to as AnnAraC) for the treatment of R/R AML, and

b. Externally funded – Advancing beyond our initial Phase 1B/2 internally funded trial for the treatment of STS metastasized to the lungs.

c. Externally funded – Based on sponsored research, we intend to begin in 2026 a Phase 1B/2 clinical trial with Annamycin as a monotherapy treating 3<sup>rd</sup> line pancreatic cancer.

d. Internally funded – MB-109 utilizing AnnAraC for R/R AML as 3<sup>rd</sup> line therapy in adults is planned for 2027.

e. Externally funded – MB-110 utilizing AnnAraC for R/R AML as 2<sup>nd</sup> line therapy in pediatrics is planned for 2027. We are researching potential sites for a grant funded trial.

2. WP1066:

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| | |
|:---|:---|
| a: | Externally funded - An improved formulation for delivery intravenously (IV) of a molecule from the WP1066 portfolio to possibly further support future externally funded oncology clinical trials. Such a formulation requires additional preclinical work prior to a clinical trial. |
| b: | Externally funded - Phase 1B/2 trial for WP1066 oral formulation in combination with radiation treating glioblastoma (GBM) both in adults and pediatrics. An adult clinical trial is in process, and a pediatric trial is in the planning stage. |

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We have established a Recommended Phase 2 Dose for WP1122 to potentially enable future externally funded oncology and virology trials. Beyond this, we support development of our core technologies through sponsored (internally funded) non-clinical research at MD Anderson.

<u>Clinical Trials Summary</u>

We have multiple active INDs/CTAs (Investigational New Drug authorization in the US or Clinical Trial Authorization in Europe). These INDs/CTAs are under development, approved, in progress, or completed comprising a total of eighteen clinical trials, internally and externally funded. With Annamycin, we currently have active one AML clinical trial, MB-108 (also referred to as the MIRACLE trial), which is a Phase 2B/3 pivotal clinical trial studying AnnAraC for the treatment of R/R AML in 2<sup>nd</sup> line subjects for which recruitment began in March 2025. MB-106, which was a Phase 1B/2 trial treating AML with AnnAraC has achieved data lock, and the clinical study report (CSR) is in process and should be published in late March 2026. Data is preliminary and subject to change. was published in early March 2026. We also had one internally funded Phase 1B/2 trial– MB-107 – and one externally funded trial – both treating STS with Annamycin as monotherapy. The externally funded trial is closed and the CSR or its equivalent is being drafted. With WP1066, we have an externally funded phase 1B/2 in combination with radiation treating GBM at Northwestern University that is actively recruiting. We are currently planning an externally funded Phase 1B/2 trial to study Annamycin as a monotherapy for the treatment of 3rd line subjects with pancreatic cancer at Atlantic Health System in New Jersey. This trial is expected to begin in 2026. This is summarized in Table 1 below. In all our discussions, clinical data, where a CSR or its equivalent has not been published, are considered preliminary and subject to change. We denote where a CSR or its equivalent has been published.

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See the notes below Table 1 and the detailed discussion in the sections following Table 1 for more information.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Table 1 - Clinical Summary as of this filing**<br> **Unless CSR Completed** – **Data are as of March 1, 2026 - preliminary and subject to change (1) (5)** | **Table 1 - Clinical Summary as of this filing**<br> **Unless CSR Completed** – **Data are as of March 1, 2026 - preliminary and subject to change (1) (5)** | **Table 1 - Clinical Summary as of this filing**<br> **Unless CSR Completed** – **Data are as of March 1, 2026 - preliminary and subject to change (1) (5)** | **Table 1 - Clinical Summary as of this filing**<br> **Unless CSR Completed** – **Data are as of March 1, 2026 - preliminary and subject to change (1) (5)** | **Table 1 - Clinical Summary as of this filing**<br> **Unless CSR Completed** – **Data are as of March 1, 2026 - preliminary and subject to change (1) (5)** | **Table 1 - Clinical Summary as of this filing**<br> **Unless CSR Completed** – **Data are as of March 1, 2026 - preliminary and subject to change (1) (5)** | **Table 1 - Clinical Summary as of this filing**<br> **Unless CSR Completed** – **Data are as of March 1, 2026 - preliminary and subject to change (1) (5)** |
| **<u>Drug</u>** <br> **<u>Candidate</u>** | **<u>Trial /</u>** <br> **<u>Indication /</u>** <br> **<u>Location</u>** | **<u>Phase</u>** <br> (Funding Source:<br> Internal unless<br> noted as External) | **<u>Status</u>** | **<u>Comments</u>** | **<u>Safety Summary</u>**<br> **<u>(6)</u>** | **<u>Human</u>**<br> **Activity Summary**<br> **(2) (3) (4)** |
| Annamycin | MB-104 / R/R AML / US | 1 | P1 Concluded; P2 replaced with MB-105 | Maximum Dose allowed per protocol 120 mg/m<sup>2</sup> | Met safety endpoints; no cardiotoxicity reported | 14.3% MLFS (subtherapeutic dose level when compared to MB-105) |
| Annamycin | MB-105 / R/R AML / Poland | 1/2 | P1 concluded; P2 replaced with MB-106 | Maximum Dose and RP2D 240 mg/m<sup>2</sup> | Met safety endpoints; no cardiotoxicity reported | 80% ORR in last cohort  |
| Annamycin in Combination with Cytarabine<br>| MB-106 / AML / Europe (7)<br>| 1B/2<br>| 22 subjects' safety evaluable. 2 subjects had an allergic reaction and did not receive full dose. Enrollment closed. CSR is in process and should be published in late March 2026. | Seven sites recruited in Poland and Italy. 22 subjects 1<sup>st</sup>-7<sup>th</sup> line. 4, 10 , and 14 subjects 1<sup>st</sup> line. 2nd line, & 2<sup>nd</sup>/3<sup>rd</sup> line, respectively | No cardiotoxicity observed during the trial. Held FDA End of Phase 1/2 meeting in June 2024 whereby feedback was received to develop MB-108 MIRACLE trial. | Phase 1B/2 CR 36% All-Comers, CR 43% 2<sup>nd</sup> & 3<sup>rd</sup> Line; CR 50% & CRc 60% 2<sup>nd</sup> Line; Durability of all CR's 13.14 mos ; CR's in Multiple genotypes/mutations; and 60% CRc in 2L subjects previously treated with venetoclax therapy) |
| Annamycin | MB-107 / STS Lung Metastases / US | 1B/2 | Phase 1 completed; Phase 2 completed; CSR finalized | RP2D of 330 mg/m<sup>2</sup> identified | No cardiotoxicity reported | Median OS 13.5 mos (n=36) as median 7<sup>th</sup> line therapy |
| Annamycin in Combination with Cytarabine<br> (AnnAraC) | MB-108 / 2<sup>nd</sup> Line R/R AML / Global (MIRACLE) | 2B/3<br>| Over 20 sites with Site Initiation Visits (SIVs) across nine countries in Europe and the US; 35 subjects treated as of February 10, 2026. | Global trial Annamycin plus cytarabine vs control arm of cytarabine plus placebo | Too early for Expert to review data. No significant cardiac events reported to date for blinded subjects.<br>| Preliminary blinded CRc 40%, CR 30% (n=30) w/ randomized three arms – AraC, AraC+190 mg/m<sup>2</sup> Annamycin, AraC+230 mg/m<sup>2</sup> |
| AnnAraC | MB-109/ 3<sup>rd</sup> Line R/R AML/ Global | 3 | 2027 target start |  |  |  |
| AnnAraC | MB-110/ Pediatric R/R AML/ US | 3<br> External (intended) | 2027 target start |  |  |  |
| Annamycin<br>| IIT / STS Lung Metastases / Poland<br>| 1B/2<br> External<br>| Study closed. CSR or its equivalent in process | Investigator led trial weekly dosing regimen versus traditional chemotherapy dosing | No cardiotoxicity reported<br>| 8 subjects enrolled and treated. No efficacy data reported to date.  |
| Annamycin | IIT/ 3<sup>rd</sup> Line Pancreatic Cancer/ US | Phase 1/2A<br> External<br> (exploring IIT) | IND planned; 2026 planned start | Monotherapy once every three weeks with correlative biomarker assessment planned |  |  |
| WP1066<br>| IIT /Adult GBM / US<br>| 1<br> External<br>| Closed prior to completion by site | Investigator left for another institution | No drug related serious adverse events noted<br>| No activity demonstrated. RP2D or MTD not established.<br>|
| WP1066 | IND cleared for GBM | 1 | Open to an investigator to lead a study |  |  |  |
| WP1066 in combination w/ radiation therapy | 2<sup>nd</sup> protocol under IND allowed for Adult GBM / US | 2<br>| Open to an investigator to lead a study | Used as reference for next trial |  |  |
| WP1066 in combination with radiation therapy | IND allowed for IIT led Adult GBM / US<br>| 1B/2<br> External | Enrolling and treating | 4 subjects enrolled and treated with 1 subject currently on active treatment | No safety data reported to date | No efficacy data reported to date |
| WP1066 in combination with radiation therapy | IIT led Pediatric Brain Tumors / US | 1B/2<br> External | Planned 2026 start |  |  |  |
| WP1066 | IIT / Pediatric Brain Tumors / US | 1<br> External | Concluded in February 2023 with a dose level at 8mg/kg; | Concluded 10 subjects enrolled and treated over 3 dose levels up to 8 mg/kg | No drug related serious adverse events noted | 1 DIPG subject had a temporary clinical response |
| WP1220 | MB-201 / CTCL / Poland | 1B / Proof<br> of<br> Concept | Concluded and CSR completed | Believe results warrant a Phase 2 study | Met safety endpoints | 60% of subjects documented PR |
| WP1122 | MB-301 / COVID-19 / UK | 1A | Completed; Established RP2D | Drug at RP2D was tolerable and safe | Met safety endpoints | N/A as in healthy volunteer subjects |
| WP1122 | IND allowed for GBM; Inactive | 1B/2 External | Open to an investigator to lead a study |  |  |  |

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*Notes for Table 1*: 1) This is a summary of the detailed clinical discussion below and does not include compassionate use/right-to-try usage of our drug candidates; 2) Complete Remission ("Response" for STS) Composite includes Complete Remission and CR with incomplete hematologic recovery (CRi or CRh); 3) Overall Response Rate (ORR) includes CRc and Partial Response (PR); 4) "Met safety endpoints" means that the studies achieved their safety objectives and refers to the overall safety profile observed in the study, which did not preclude continued clinical development. Serious adverse events were reported, including one considered related to study drug and unexpected. 5) All data presented are preliminary (and subject to change) unless a CSR or its equivalent has been issued for the trial referenced; 6) With regard to safety and human activity summaries please see the detailed discussion below; and, 7) MB-106 Phase 1 included "all-comers" or subjects with unlimited lines of prior therapy while Phase 2 included only subjects as 1<sup>st</sup> thru 3<sup>rd</sup> line of therapy.

**Our Drug Candidate Programs**

<u>Overview</u>

In the US and Europe, since our inception, we or independent investigators are actively planning, have approval to begin, are currently conducting or have completed eighteen internally or externally funded clinical trials for our drug candidates – Annamycin, WP1066, WP1220, and WP1122, as listed above. All of the clinical trials are or were in the Phase 1 or 2 stage with the exception of MB-108 which is a Phase 2B/3. Starting in 2021 through 2024, there have been eight "right-to-try" or "compassionate use" (or their foreign equivalent) uses of Annamycin and WP1066.

Our clinical trials focused on Annamycin in 2024 with two internally funded and one externally funded Phase 1B/2 clinical trials. We concluded recruitment and treatment in the MB-107 Phase 1B/2 all comers clinical trial using Annamycin as a single agent for the treatment of STS lung mets in 2023 and followed for progression free survival (PFS) and OS during 2024. The CSR was published in 2025. In our MB-106 Phase 1B/2 all-comers clinical trial using Annamycin in combination with Cytarabine for the treatment of AML, we concluded recruitment and treatment with 23 subjects recruited on an Intent-To-Treat (ITT) basis (22 subjects' safety evaluable with one subject enrolled but never treated). The term "all-comers" for this trial indicates that we did not limit the number of prior therapies for subjects entering the trial in the Phase 1 portion of MB-106. In the Phase 2 portion we did limit the number of prior therapies to two. We utilized the MB-106 data for an End of Phase 2 (EOP2) meeting with the U.S. Food and Drug Administration in July 2024. The CSR for MB-106 is in process and should be published in late March 2026. Data is preliminary and subject to change.

In July 2024, we announced the completion of our EOP2 meeting with the FDA for our Phase 1B/2 clinical trial evaluating Annamycin in combination with Cytarabine for the treatment of subjects with AML as both first line therapy and for subjects who are refractory to or relapsed after induction therapy (MB-106). We believe that this meeting, based upon the FDA minutes, was a positive discussion and resulted in the design and implementation of a Phase 2B/3 pivotal trial for the treatment of AML patients who are refractory to or relapsed after induction therapy (R/R AML). The MIRACLE trial is a global trial, including sites in the US, Europe or the European Union (EU), and Eastern Europe. The FDA's Divisions of Hematologic Malignancies I and Cardiology and Nephrology, as well as related divisions, were involved in the review of the data showing no cardiotoxicity in MB-106 and prior clinical trials. Consistent with the FDA's recommendations, in the adaptive MIRACLE trial we are utilizing a double-blind, placebo-controlled design, where we will compare two arms of AnnAraC, with two different strengths of Annamycin, versus a control arm of high dose cytarabine (HiDAC) plus placebo and we will rely solely on CR (complete remission) after a single cycle of treatment (at approximately one month) as the primary endpoint. The FDA also wanted to see overall survival (OS) as a secondary endpoint and durability of response (DoR) as an exploratory endpoint, as well as data for patients beyond 2nd line, which is why our plan includes a follow-on MIRACLE2 trial in 3rd line patients starting once the optimum dose is established in the MIRACLE trial.

Based on our discussions with the FDA, we amended in September 2024 our MB-104 investigational new drug application or IND for MB-108. In the amendment with the new MIRACLE protocol, the trial, for the first time ever in the US, allowed for dosing in an AML trial above the lifetime maximum allowable dose (LTMAD) for currently prescribed anthracyclines.

The MIRACLE study, subject to appropriate future filings with and potential additional feedback from the FDA and their foreign equivalents, utilizes an adaptive design whereby the first 90 subjects will be randomized (1:1:1) in Part A of the trial to receive five days of HiDAC combined with three days of either placebo, 190 mg/m2 of Annamycin, or 230 mg/m2 of Annamycin, which Annamycin doses were specifically recommended by the FDA in the Company's end of Phase 1B/2 meeting. This "5+3" regimen differs from the traditional 7+3 regimen which is considered the gold standard for first line AML therapy whereby patients receive seven days of HiDAC plus three days of a currently prescribed anthracycline. We believe 5+3 not only improves tolerability for patients but also reduces cost and strain on hospital staff by not having to schedule infusions over a weekend.

The amended protocol allows for an interim unblinding of data of the first 45 subjects treated with efficacy data across the three arms. In addition, there is an unblinding of data at the conclusion of Part A (at a total of up to 90 subjects) for all three arms. The first interim unblinding should yield approximately 30 subjects treated with Annamycin (190mg/m2 and 230/m2) and HiDAC compared with approximately 15 subjects from the control arm. The use of the word "approximately" is due to randomization of these 45 subjects between the three arms. The Company expects to reach the first interim unblinding (45 subjects) in mid-2026 with the expected second unblinding of the full 90 subjects in Part A in the second half of 2026.

For Part B of the trial, 222 additional subjects will be randomized to receive either HiDAC plus placebo or HiDAC plus the optimum dose of Annamycin (randomized 1:1). The selection of the optimum dose will be based on the overall balance of safety, pharmacokinetics and efficacy obtained from Part A, consistent with the FDA's new Project Optimus initiative.

Additionally, recruiting and treatment concluded in 2024 for the externally funded Phase 1B/2 clinical trial studying an alternative dosing schedule of Annamycin for the treatment of STS lung mets in Poland. The investigator is expected to issue a publication or CSR in 2026 on this study.

In February 2023, the Emory physician-sponsored clinical trial for the treatment of pediatric brain tumors with an oral formulation of WP1066 concluded. Final positive results were announced in December 2025 from the Emory's physician-sponsored Phase 1 clinical trial. The results of this first-in-child trial show some encouraging signals of activity in a highly aggressive chemotherapy resistant brain cancer, such as partial tumor response in a diffuse intrinsic pontine glioma (DIPG) patient and clear anti-tumor immune changes. Additionally, externally funded preclinical work is being performed at Emory University and along with the data from the clinical trial at Northwestern University, should set the stage for additional pediatric studies at Emory University in the future.

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<u>Annamycin Program</u>

<u>*Overview*</u>

We believe Annamycin can be a safer and more efficacious "next-generation" anthracycline, unlike any currently approved anthracyclines. We believe its design 1) avoids cardiotoxicity, 2) improves safety and tolerability, 3) overcomes multidrug resistance (MDR), 4) avoids cross resistance with commonly used first line therapies, 5) provides improved tissue/organ distribution and uptake, and 6) demonstrates a unique ability to target key sites of cancer metastasis. We believe Annamycin has the potential to be highly significant and disruptive as current anthracyclines are used to treat approximately half of all cancers and 60% of all childhood cancers. The latter statistic is particularly important since it is estimated that more pediatric cancer patients will suffer cardiovascular disease later in life as a result of their treatment than a recurrence of the cancer for which they were treated.

Our preclinical studies and clinical trials support this intended design. The lack of cardiotoxicity and the potential for efficacy of Annamycin have been demonstrated in 90 subjects treated to date. Based upon the efficacy and safety data to date, we believe that Annamycin has potential to fill an unmet need as a second line therapy (2<sup>nd</sup> line) in AML and potentially as a first line therapy (1<sup>st</sup> line) in both AML and Advanced STS.

Furthermore, preclinical studies indicate that Annamycin has the potential to be not only safer and more effective than currently prescribed anthracyclines in a wide range of additional cancer indications, but also to be effectively used to treat primary and metastatic cancers resistant to other anthracyclines or cancers where no effective therapies or only limited therapeutic options are available, including:

• Pancreatic cancer

• Pancreatic cancer metastasized to the liver

• Colorectal cancer metastasized to the liver

• Colorectal cancer metastasized to the lungs

• RCC metastasized to the lungs

• Endometrial cancer metastasized to the lungs

• Hepatocellular carcinoma

• Triple negative breast cancer metastasized to the lungs

• Sarcoma metastasized to the lungs

The FDA and the EMA (European Medicines Agency) have granted Orphan Drug Designation (ODD) to Annamycin for the treatment of AML. Additionally, the FDA has granted ODD for Annamycin for the treatment of soft tissue sarcoma. Such designation means, in part, these agencies believe we have established a medically plausible basis for using the drug for those indications. The FDA also granted Fast Track-Designation for Annamycin for both the treatment of AML and Soft Tissue Sarcoma. A drug that receives Fast Track-Designation (FTD) is eligible for some or all of the following:

• More frequent meetings with FDA to discuss the drug's development plan and ensure collection of appropriate data needed to support drug approval;

• More frequent written communication from FDA about such things as the design of the proposed clinical trials and use of biomarkers;

• Eligibility for other FDA expedited programs, if relevant criteria are met; and

• Rolling review by FDA of the NDA, rather than waiting until every section of the NDA is complete before beginning review of the application, which is the typical process.

*Annamycin* – *the Next-Generation Anthracycline*

Our description of Annamycin as a next-generation anthracycline stems from how significantly different it is from any anthracyclines that have preceded it. First-generation anthracyclines are the "classic" agents such as daunorubicin and doxorubicin, which were among the earliest anthracyclines developed and widely adopted in oncology. Second-generation anthracyclines are later structural analogs designed to modify toxicity and/or spectrum of activity; commonly cited examples include epirubicin and idarubicin. Annamycin is an entirely new chemical entity integrating a new molecular structure with a unique and innovative multilamellar lipid delivery mechanism designed to address the problems associated with early-generation anthracyclines. While it incorporates molecular structure changes found in second-generation anthracyclines the molecule also benefits from the addition of an iodine atom that dramatically changes the physical structure as compared with all prior generations of anthracyclines. Among other things, iodine facilitates a significant increase in lipophilicity and when integrated into our unique multilamellar vesicle never before used with existing anthracyclines, preclinical research has demonstrated Annamycin to be a safer and more effective alternative in a wide range of tumor models.

Annamycin's unique next-generation design also results in substantive differences in pharmacokinetics when compared with currently used anthracyclines. Preclinical models comparing Annamycin with doxorubicin show a significant increase in cellular uptake and retention, as well as what we believe are highly beneficial changes in tissue/organ distribution. These changes also result in a profound "organotropism" enabling Annamycin to accumulate in certain organs that are particularly important when targeting cancer cells.

*The Importance of Lower Cardiotoxicity and Multi-Drug Resistance for 2<sup>nd</sup> Line Therapy*

Chemotherapy continues to be a cornerstone of cancer therapy. Despite the progress made with immunotherapy and precision medicine, the first-line treatment for many cancers continues to include chemotherapy. In part, because of the emphasis placed on alternatives to chemotherapy, we believe that not enough has been done to improve chemotherapeutic agents to make them safer, especially with regard to cardiotoxicity (damage to the heart), and more effective. Anthracyclines are a class of chemotherapy drugs designed to destroy the DNA (by creating iron-mediated free oxygen radicals, damaging the DNA and cell membranes, and inhibiting topoisomerase II) of rapidly reproducing cancer cells. Acute leukemia is one of a number of cancers that are usually treated with anthracyclines in patients who are considered to be "fit" enough to undergo such therapy. In the case of acute leukemia, anthracyclines are typically used in "induction therapy," where the goal is often to induce sufficient remission of patients' bloodborne tumor cells to allow for a potentially curative bone marrow transplant.

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Several key factors limit the safety and effectiveness of anthracyclines: cardiotoxicity, multidrug resistance and tissue/organ distribution and uptake. We believe Annamycin represents a significant improvement over currently prescribed anthracyclines in each of these areas. If early clinical data of efficacy are borne out in subsequent clinical trials, of which there can be no assurance, Annamycin may ultimately provide clinically meaningful benefits over currently approved anthracyclines in treating certain cancers. While we believe this is especially the case as a 2<sup>nd</sup> line therapy in R/R AML, we also believe there is a significant opportunity for Annamycin to become a first line standard of care.

The potential for cardiotoxicity in pediatric leukemia patients, whose life spans can be severely shortened by the induction therapy intended to cure them of acute leukemia, represents a significant risk. In the animal model recommended by the FDA as an indicator of human cardiotoxicity, the non-liposomal (free) form of Annamycin has been shown to be significantly less likely than doxorubicin to create heart lesions in mice, and the liposomal formulation (L-Annamycin) has been shown in these same models to further reduce cardiotoxicity. If this same characteristic continues to be shown in humans, it may allow Annamycin to be used more aggressively to help patients achieve remission. This would be especially valuable in the case of pediatric acute leukemia (both AML and acute lymphoblastic leukemia or ALL) because of the potential impact of cardiotoxicity on long-term survival.

As part of our Annamycin clinical trials, we have engaged an independent expert at the Cleveland Clinic to assess cardiotoxicity associated with chemotherapy (Expert or Independent Expert). The data made available to the Expert include left ventricular ejection fraction (LVEF) as determined by echocardiograms, and ECHO strain imaging, as well as serum Troponin levels (a biochemical marker of acute heart damage). "ECHO strain imaging" is a method in echocardiography (medical ultrasound) for measuring regional or global deformation (contraction or beating) of the myocardium (heart muscle). By strain rate imaging, the simultaneous function of different regions can be displayed and measured. Cardiac health biomarkers such as blood Troponin levels are considered an indicator of potential long-term heart damage. The Expert has issued and will continue to issue periodic reports as additional data are provided to him in batches of subject data. Such data include some data which are preliminary and subject to change. In our discussions regarding the lack of Annamycin's cardiotoxicity, we rely on the Expert's assessment.

To date, we have received several independent assessments for the absence of cardiotoxicity in subjects treated with Annamycin. We have not seen evidence of cardiotoxicity in over 100 subjects that have been treated with Annamycin in our clinical trials to date. Within in that population, we now have independent assessments covering 90 subjects that have been treated with Annamycin in five different clinical trials in the U.S. and Europe with no evidence of cardiotoxicity. To date, of the 90 subjects treated in our internally funded trials, 65 were treated above the FDA's lifetime maximum anthracycline limit of 550 mg/m<sup>2</sup>, with one subject having been treated with 3420 mg/m<sup>2</sup> (combined doses of prior anthracyclines plus Annamycin) of anthracyclines and there has been no evidence of cardiotoxicity. The 3420 figure converts to 6534 mg/m<sup>2</sup> on a combined basis of prior anthracyclines plus Annamycin expressed as a daunorubicin-equivalent estimate based on the conversion factor described in Zamorano et al. 2016. After review of the data provided, the Independent Expert, in their most recent report and as stated in previous reports, concluded that there was no evidence of cardiotoxicity.

We believe the expert's reports are particularly relevant in light of a recently published retrospective study showing that the incidence of heart failure more than doubles for cancer patients treated with anthracyclines compared to cancer patients not receiving anthracyclines (C Larson, et al. Anthracycline and Heart Failure in Patients Treated for Breast Cancer or Lymphoma, 1985-2010. JAMA Network Open. 2023;6(2):e2254669. doi:10.1001/jamanetworkopen.2022.54669). Given the heart-damaging impact of prior treatment with currently prescribed anthracyclines, and considering that the subject population that we are enrolling in our Annamycin trials (multiple prior therapies, including anthracyclines known to be cardiotoxic, many elderly, and other comorbidities) we believe that there is a high likelihood that a cardiac event will occur in the future that we will not be able to disassociate from our study drug. We believe that the potential for such future incidences, however, does not outweigh the significant elimination of cardiotoxicity to date as reflected in the Expert's reports.

In addition, the effectiveness of currently approved anthracyclines is limited by their propensity for succumbing to "multidrug resistance." This can occur where, as a natural defense mechanism, transmembrane proteins acting as transporters (one type of which is referred to as a "P-glycoprotein pump" or an "ABCB1 transporter"; otherwise referred to as "MDR1 mechanisms") develop on the outer surface of cells to expel perceived threats like anthracyclines. In many instances, the likelihood of cardiotoxicity (and other serious side effects) prevents increasing the dosing of current therapies in order to overcome multidrug resistance. As a result, most patients cannot receive current anthracyclines in doses that are adequate to produce lasting remission and thereby qualify for a bone marrow transplant. A laboratory study has suggested that Annamycin may resist being expelled by P-glycoprotein pumps and similar multidrug resistance transporters, which may mean the drug circumvents multidrug resistance. Although significant further study is necessary, this characteristic has been shown in pre-clinical testing to allow for higher drug uptake in diseased cells, which we believe could allow for more effective induction therapy with less risk to the patient, especially in relapsed patients. We believe that the encouraging preliminary efficacy being demonstrated in our clinical trials in 2<sup>nd</sup> line AML therapy may, in part, be the result of Annamycin's ability to avoid MDR1 mechanisms.

*The Organotropic Nature of Annamycin*

Nonclinical research at MD Anderson has indicated that Annamycin has an organotropic nature enabling it to hyperaccumulate in certain key organs, including the liver, spleen, pancreas and lungs as compared with existing anthracyclines such as doxorubicin. This could prove to be especially valuable for primary tumors in or tumors that eventually metastasize to these organs. As an example, animal models have shown a 39-fold increase in the concentration of Annamycin over doxorubicin (one of the most commonly used anthracyclines) in the spleen, which is considered a sanctuary site for residual disease in AML patients. In these same models, we see a 31-fold increase in uptake to the lungs where sarcoma metastases are most commonly found and an 11-fold increase in uptake to the pancreas where drug uptake is notoriously difficult.

We announced in April 2019 that our ongoing sponsored nonclinical research at MD Anderson demonstrated that Annamycin may improve survival in an aggressive form of triple negative breast cancer metastasized to the lungs in animal models. Annamycin was previously shown to be significantly more potent than doxorubicin in both Lewis lung carcinoma in animal models and in small cell lung cancer *in vitro* models. In addition to seeing activity in animal models of triple negative breast cancer metastasized to the lungs, we have also seen activity in colon cancer metastasized to the lungs. The particular animal models used in our testing are considered to represent very aggressive forms of cancer.

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Furthermore, a poster entitled, "Liposomal annamycin inhibition of lung localized breast cancer," was presented at the San Antonio Breast Cancer Symposium held in December 2019. The published poster (https://www.moleculin.com/san-antonio-bc-symposium-poster/) shows substantially increased survival in both triple negative breast cancer and colon cancer lung metastases animal models. It should also be noted that treatment with Annamycin resulted in long-term survival of a significant number of animals, even when cancer was reintroduced into the animals post initial treatment, suggesting the development of beneficial immune memory. A reduction in tumor growth was demonstrated as well as a reversal of tumor activity resulting in an almost complete reduction of tumor burden. Such preclinical results may not be replicated in human clinical trials.

We announced in early 2021 that Annamycin demonstrated consistently high antitumor activity in tested animal models of different types of lung-localized cancers, including sarcoma. These promising findings correlate with a high uptake of Annamycin to the lungs in animal models. We found in our studies that Annamycin uptake to the lungs is over 30-fold higher than that of doxorubicin, the primary first-line chemotherapy for advanced soft tissue sarcoma. The limited pulmonary uptake of doxorubicin in animal models may help explain its limited activity against STS lung metastases in humans. Additionally, our clinical data to date show no cardiotoxicity associated with the use of Annamycin, and the published research demonstrate Annamycin's ability to avoid multidrug resistance mechanisms, both of which are often treatment-limiting effects of anthracyclines (which includes doxorubicin) in this setting. Taken together, these factors suggest that Annamycin could represent an important treatment to help address a significant unmet need in patients with STS lung metastases.

In February 2021, we also announced that a preclinical study in animals had suggested a possible significant therapeutic benefit of Annamycin against metastatic osteosarcoma. As of day 130 of the study, the survival rate for animals treated with Annamycin was 100%, compared with only 10% for untreated animals. Computerized tomography scans demonstrated that animals treated with Annamycin exhibited suppression of tumor growth and not a single death was observed in the treated animals, whereas observed tumor burden was believed to have contributed to the rapid death of 90% of untreated animals. We believe these data are a promising indication of the possibility of Annamycin's impact on other cancers metastasized to the lungs. We caution that these are preclinical animal data and we can provide no assurance that we will see similar results in our clinical trials, let alone ultimately obtain approval of Annamycin for this use.

*The Importance of the Unmet Need in 2<sup>nd</sup> Line Therapies for AML* 

There are approximately 150,000 people with AML worldwide with over 20,000 newly diagnosed patients annually in the U.S. (https://www.cancer.org/cancer/types/acute-myeloid-leukemia/about/key-statistics.html). Anthracyclines are an important class of first line tools for physicians and while effective, their rate of relapse is very high and their maximum lifetime dose in patients is limited due to concerns over cardiotoxicity. The following discussion, which includes estimates based on current literature and our discussions with key opinion leaders, suggests that approximately 60% of AML patients continue to have a significant unmet need for new and effective therapies. This is based on the reality that effective treatment options are limited. We estimate that only around 40% of AML patients are afforded an opportunity to overcome their disease through a curative bone marrow transplant or through lasting remission. We believe this aligns with the published statistic that the 5-year survival rate for AML is roughly 30% (https://seer.cancer.gov/statfacts/html/amyl.html).

While the standard of care treatment can be complex, regionally variable (especially since not all current AML drugs are approved in all countries), and highly individualized (based on a range of factors including gene mutations), all AML patients are initially categorized based on their ability to undergo intensive chemotherapy. As a result, we estimate around 50% of patients are deemed "Fit" for standard intensive first-line treatment and the other 50% are deemed "Unfit." This delineation is most often based primarily on age with those over 65 years of age commonly deemed to be Unfit, however younger patients with comorbidities and especially cardiac impairment may also be deemed to be Unfit.

Those who are deemed "Fit" are most often treated with the "standard" induction therapy of three days of intravenous daunorubicin or equivalent anthracycline, and seven days of intravenous cytarabine. This first line regimen is often referred to as "7+3." We estimate that only about 36% of these patients, or approximately 18% of overall AML patients, will have a durable CR as a result of first line therapy, meaning the cancerous cells in their bone marrow have been reduced to 5% or less and that this remission lasts long enough to have a meaningful impact on their overall survival. At this point, they either qualify for a bone marrow transplant or hope for the remission to become long lasting. Bone marrow transplants (BMT) can be successful in as many as 80% of eligible patients. However, since so few patients actually get to this point, we estimate that only a minor subset (approximately 14%) of all AML patients reach this positive outcome, through the standard first-line pathway for "fit" patients.

The 50% of patients who are deemed "Unfit" for first-line intensive chemotherapy treatment are usually treated with a combination of venetoclax and azacytidine, also known as "Ven-Aza". The success rate, as we estimate, in this group of patients is only around 37%, or approximately 19% of all AML patients, achieving a durable CR and qualifying for a BMT or achieving long-term remission. While this success rate appears as good or better than 7+3 in "Fit" patients, it generally takes much longer and considering the limited remaining life expectancy for AML patients, the faster regimen is favored whenever patients are considered "Fit." Similarly, we estimate that as many as 80% of these responding patients will benefit from a bone marrow transplant or experience lasting remission. But again, this means that only a small subset of the deemed "Unfit" patients, approximately 15% of all AML patients, achieve this positive outcome.

Additionally, a study of AML subjects who were refractory to or relapsed after receiving venetoclax plus a hypomethylating agent regimen (such as azacitidine) as 1<sup>st</sup> line therapy demonstrated a dismal outcome upon failure of this regimen with a median OS of just 2.4 months. Of those subjects, that, upon venetoclax regimen failure received salvage therapy, only 12.5% and 4% achieved a CRc and a CR, respectively (A. Maiti, C. Rausch, J. Cortes, Et al, "Outcomes of relapsed or refractory acute myeloid leukemia after frontline hypomethylating agent and venetoclax regimens, *Haematologica* online, vol. 106 No.3 (2021)).

In recent years, new targeted therapies have been approved (mostly in the US) and have become available to 2<sup>nd</sup> line patients (those patients for whom the 1<sup>st</sup> line therapies discussed above have failed), adding a new alternative. Unfortunately, we believe success here has been relatively limited. Six such drugs have been approved to date, but each is only relevant to a subset of AML patients who happen to have the requisite genetic mutation and response rates are relatively low. We estimate that only about 21% of those 2nd line patients who happen to have the requisite genetic profile will achieve a durable CR, which means only another 18% of the AML population is given a chance to beat their disease with a successful bone marrow transplant or lasting remission. This leaves, based on our estimates, about 60% of all AML patients who will ultimately succumb to their disease.

We believe this is not an acceptable outcome and are advancing Annamycin for the treatment of AML via our clinical trials. In multiple clinical studies, subjects treated with Annamycin have shown no signs of drug-related cardiotoxicity, allowing physicians to dose higher than the currently set limits for other anthracyclines or potentially treat traditionally "Unfit" subjects. The subjects treated to date have included those who were initially deemed unfit for intensive chemotherapy and the initial, preliminary data suggest that Annamycin's safety and tolerability profile may make the product suitable for those patients, too.

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*Annamycin Clinical Trials* – *AML*

We have studied Annamycin in three internally funded AML clinical trials. These trials are MB-104, MB-105, and MB-106. In MB-105 and MB-106, we saw what we believe to be potentially significant efficacy in AML using Annamycin as a monotherapy. With that data in July 2024, we announced the completion of our EOP2 meeting with the FDA for our Phase 1B/2 clinical trial evaluating Annamycin in combination with Cytarabine (also known as "Ara-C" and for which the combination of Annamycin and Ara-C is referred to as AnnAraC) for the treatment of subjects with AML as both first line therapy and for subjects who are refractory to or relapsed after induction therapy (MB-106). Based upon the FDA minutes, we designed and began implementation of a Phase 2B/3 pivotal trial, dubbed the MIRACLE trial, for the treatment of AML patients who are refractory to or relapsed after a single induction therapy. MIRACLE is a global trial, including sites in the US, Europe, Western Asia and the Middle East. The MIRACLE study is a Phase 2B/3 clinical trial whereby data from the 2B portion will be combined with the Phase 3 portion. This trial is more fully discussed below. It should be noted that periodically throughout the trials below up to and excluding MB-108, our Expert reviewed cardiotoxicity, as discussed above.

<u>MB-104:</u> A Phase 1 clinical trial of Annamycin as a single agent for the treatment of R/R AML in the US was successfully completed in 2020. The FDA requested that we demonstrate that Annamycin could be safely administered to subjects up to the lifetime maximum allowable level of anthracycline (LTMAD) established by the FDA and the trial met this primary endpoint. The FDA established the LTMAD because of concerns about cardiotoxicity associated with currently approved anthracyclines when administered above the LTMAD. Our independent Expert, an oncologist who specializes in cardiotoxicity of anthracyclines at the Cleveland Clinic, noted that after review of the data for the subjects in this trial there were no signs of cardiotoxicity.

<u>MB-105:</u> As a result of discussions with the FDA after MB-104, we focused our continuing efforts on establishing an RP2D for Annamycin in our Phase 1/2 single agent R/R AML clinical trial in Europe. In December 2018, we began treatment at the final dose of MB-104 of 120 mg/m<sup>2</sup>. In February 2022, we successfully concluded the Phase 1 portion of that trial and established the RP2D of 240 mg/m<sup>2</sup>. A total of 20 subjects were enrolled in this trial. Per the CSR, drug related serious adverse events significant adverse events (AE's) <u>></u> grade 3 in this trial (n=20) were: neutropenia 80%, thrombocytopenia 75%, anemia 75%, febrile neutropenia 30%, and pancytopenia 10%. Drug related serious adverse events (SAE's) were: neutropenia 65%, thrombocytopenia 50%, anemia 40%, febrile neutropenia 30%, pancytopenia 10%, and leukopenia, hepatocellular injury, hepatotoxicity, anaphylactic reaction, sepsis, and hypotension 5% each.

In the final cohort, five subjects received a full course of Annamycin and demonstrated an ORR of 80% with one CRi and three PRs. However, in two of the PRs, as noted by the site, subjects' bone marrow blast counts were successfully decreased to below 5%, however these subjects were still designated as a PR by the sub-investigator at that site. Our Expert noted no cardiotoxicity in subjects in this trial.

As a part of our ongoing sponsored research at MD Anderson, animal testing indicated that the combination of Annamycin with Ara-C provides a synergistic effect that is more effective in AML mouse models than either drug alone. These data were presented at the 62nd Annual Meeting & Exposition of the American Society for Hematology (ASH) under the title: "High Efficacy of Liposomal Annamycin (L-ANN or L-Annamycin) in Combination with Cytarabine (AnnAraC) in Syngeneic p53-null AML Mouse Model." This study was conducted in a highly aggressive AML mouse model where median survival is approximately 13 days. For animals treated with AnnAraC, median survival ranged from 56 to 76 days. Additionally, when looking at median OS for the mice in the study, AnnAraC demonstrated a 68% improvement in the OS compared to Annamycin as a single agent and a 241% increase in OS compared to Cytarabine alone. We believe these experiments supported initiation of clinical development of the combination of Annamycin and Ara-C in AML patients.

Although Annamycin had already shown human activity as a single agent in its two Phase 1 AML clinical trials and had shown no signs of cardiotoxicity, the observed synergy in vitro and confirmatory in vivo data suggested that the AnnAraC could be more effective in a clinical setting than Annamycin as a single agent. This would also be consistent with the current practice to use Ara-C in combination with other anthracyclines in AML patients. The most common first-line therapy for fit AML patients currently is the combination of an anthracycline and Ara-C in a regimen referred to as "7+3" where Ara-C is administered daily for 7 days in parallel with 3 daily doses of an anthracycline. Simply substituting Annamycin for the currently used anthracycline in a similar 7+3 regimen would therefore represent a familiar and well-practiced treatment modality. In the case of MB-106 and MB-108, however, we utilized a 5+3 regimen, which was consistent with our preclinical animal testing and which our advising clinicians believed would not only be better tolerated by patients but would also reduce cost and hospital staffing burden by not extending the infusion period over a weekend. Beyond that, we believed it would have the added advantages that Annamycin has been shown in published research to be active against tumor cells resistant to doxorubicin and, importantly, has the potential to remove the concern for cardiotoxicity, a significant toxic side effect currently limiting the use of anthracycline-based intensive chemotherapy. Thus, we focused our efforts on a clinical trial studying AnnAraC for the treatment of AML in Europe.

<u>MB-106</u>: Below in Table 2 is a summary of the responses demonstrated in the MB-106 combination therapy trial to date.

***Table 2* - Summary of Annamycin Responses in MB-106 AML Studies Per Draft CSR**

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| | | |
|:---|:---|:---|
|  | **Study MB-106 Combination Therapy**– **Phase 1B/2 All Lines (Range As 1<sup>st</sup>-7<sup>th</sup> Line)** | **Study MB-106Combination Therapy**– **Phase 1B/2 (As 2<sup>nd</sup> Line Only)** |
|  | **Ara-C + Annamycin "5+3"** | **Ara-C + Annamycin**"**5+3"** |
| **<u>All Subjects</u>** |  |  |
| Recruited & Dosed | 22 | 10 |
| Subjects Evaluable Not Dosed Per Protocol | 2 | 1 |
| Median Age - Years (Range) | 68 (19-78) | 71 (53 - 78) |
| CR | 8 (36%) | 5 (50%) |
| CRi | 1 | 1 |
| Total CR's | 9 (41%) | 6 (60%) |
| Partial Responses (PRs) | 2 | 1 |
| BMT To Date | 4 | 2 |
|  | (12) | (12) |

---

*Notes for Table 2*: 1) Data from MB-106 is for intent to Treat subjects; 2) Data from MB-106 is per the current draft CSR. The final CSR is in process and should be published in late March 2026. Data is preliminary and subject to change.

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Median OS for CR responders (n=8) was 15.2 months at study close and was developing. In such cases the median at study close is based on a theoretical sensitivity analysis. Median OS for second line subjects (n=10) was 12.39 months and the median OS for first thru seventh line subjects (n=22) was the same 12.39 months. DoR for the CR responders was 13.14 months.

In May 2023, we announced successful completion of the first cohort in our Phase 1B portion of our Phase 1B/2 clinical trial using Annamycin in combination with Cytarabine for the treatment of AML. In the first cohort, 3 subjects were treated, all of whom were relapsed from multiple prior therapies. Annamycin was dosed at 190 mg/m<sup>2</sup>, along with Cytarabine at 2.0 g/m<sup>2</sup>/day for five days (total dose of 10g/m<sup>2</sup>).

At the recommendation of the safety review committee, we deemed the first cohort dose as safe and opened the second cohort with the Annamycin dose being increased to 230 mg/m<sup>2</sup>. In August 2023, we successfully completed the second cohort at 230 mg/m<sup>2</sup> of Annamycin in this combination study. Of the four subjects treated in this cohort, one is believed to be relapsed from one or more prior therapies and three are believed to be refractory to up to three prior therapies. At the recommendation of the safety review committee, we deemed the second cohort dose as safe and as the recommended expansion phase dose and opened recruitment, including for both first line therapy and for subjects who are refractory to or relapsed after induction therapy, to the Phase 2 portion of the trial.

At the end of January 2024, we completed recruiting the desired number of 2<sup>nd</sup> line subjects and began preparation for an End of Phase 2 meeting with the FDA. In addition, we expanded the MB-106 study protocol to include 1st line subjects to provide data to enable the designing of a potential confirmatory Phase 3 post-approval study. Later in 2024, we closed all recruitment.

As mentioned previously, the Phase 1b portion of the MB-106 clinical trial with Annamycin in combination with Cytarabine for the treatment of AML was an "all-comers" (as discussed above) trial, accepting subjects with a wide range of prior therapies. The Phase 2 portion was open to being 1st thru 3rd line of therapy. The total subjects recruited was 22. The results of the trial to date are shown in Table 2 above. These data are per the draft CSR. The final CSR is in process and should be published in late March 2026. No evidence of cardiotoxicity was noted by the Expert following assessments of the MB-106 data.

Grade ≥3 treatment-emergent adverse events (TEAEs) were reported in 21 of 22 subjects (95.5%) in the safety population. The most frequently reported Grade ≥3 TEAEs (≥20% of subjects) were hemoglobin decreased (10 subjects, 45.5%), platelet count decreased (9 subjects, 40.9%), and pneumonia (5 subjects, 22.7%). Additional Grade ≥3 TEAEs reported in more than two subjects included neutrophil count decreased (4 subjects, 18.2%) and febrile neutropenia (3 subjects, 13.6%). Two subjects experienced adverse events and were not dosed per protocol with one having an allergic reaction to Annamycin; the second adverse event was due to an allergic reaction to cytarabine. The CR/CRc's have been spread across 4 different sites in two different countries (Poland and Italy) and 7 out of 9 sites participating in the study have recruited subjects to date. 

<u>MB-108</u>: In July 2024, we announced the completion of our EOP2 meeting with the FDA for our Phase 1B/2 clinical trial evaluating Annamycin in combination with cytarabine for the treatment of subjects with AML as both first line therapy and for subjects who are refractory to or relapsed after induction therapy (MB-106). We believe the FDA minutes reflect a positive discussion and the meeting resulted in the design and implementation of a Phase 2B/3 pivotal trial for the treatment of AML patients who are refractory to or relapsed after induction therapy. The FDA's Divisions of Hematologic Malignancies I and Cardiology and Nephrology, as well as related divisions, were involved in the review of the data showing no cardiotoxicity in MB-106. Consistent with the FDA's recommendations, in the adaptive MIRACLE trial we plan to utilize a double-blind, placebo-controlled design, where we will compare AnnAraC versus the control arm of HiDAC plus placebo and we will rely solely on CR (complete remission) after a single cycle of treatment (at approximately one month) as the primary endpoint. The FDA also wanted to see overall survival as a secondary endpoint and the DoR as an exploratory endpoint. The FDA also wanted data for patients beyond 2nd line, which is why our plan includes a follow-on MIRACLE2 trial in 3rd line patients starting once the optimum dose is established in the MIRACLE trial. The MIRACLE trial is a global trial as described above – across nine countries including the US, Spain, Italy, Poland, Ukraine, Czechia, Romania, Georgia, and Lithuania with 25 sites targeted for Part A and more sites and countries targeted for Part B, as described above and below.

Based on our discussions with the FDA, we amended in November 2024 our MB-104 investigational new drug application or IND for MB-108. In the amendment with the new MIRACLE protocol, the trial allows, for the first time in the US, for AML subjects to be dosed above the lifetime maximum allowable dose for currently prescribed anthracyclines. Subsequently, in February 2025 we received FDA feedback and guidance on our IND amendment, noted above, that allowed a reduction in the size of Part B of the trial to 222 subjects. With their feedback and our response, all the major aspects of the trial remain unchanged.

During 2025, we received various comments and requests from the FDA on the MIRACLE trial and we may continue to receive comments and requests from the FDA in the future. We responded to each in a timely manner. While we believe that we responded adequately, we cannot be assured that our responses or that our future responses will be adequate for the FDA to continue to allow the amended IND to proceed, or that there will not be additional requests for information. Because we are amending an existing IND, there is no required time for the FDA to respond to our submissions, but neither is a response required for us to proceed with the MIRACLE trial. As with all clinical trials, if at any time the FDA believes there is a safety issue that merits it, the agency may put the MIRACLE trial on clinical hold.

In the first half of 2025, we submitted clinical trial applications or their equivalent in the EU and the non-EU countries listed above. Our first approval to proceed with MIRACLE occurred in Ukraine in February 2025 and we dosed the first subject in March 2025. We received EU approval to commence the MIRACLE trial in May 2025. Soon after, we then received the approval for the other non-EU countries in 2025.

The MIRACLE study, subject to appropriate future filings with and potential additional feedback from the FDA and their foreign equivalents, utilizes an adaptive design whereby the first 90 subjects will be randomized (1:1:1) in Part A of the trial to receive HiDAC (or AraC) combined with either placebo, 190 mg/m2 of Annamycin, or 230 mg/m2 of Annamycin, which Annamycin doses were specifically recommended by the FDA in the Company's end of Phase 1B/2 meeting. The amended protocol allows for an interim unblinding of data of the three arms for the first 45 subjects with efficacy data and then an unblinding at the conclusion of Part A (full 90 total subjects). This early unblinding will yield approximately, due to randomization, 30 subjects having received Annamycin (190 mg/m2 and 230 mg/m2) and HiDAC and approximately 15 subjects receiving HiDAC plus placebo. The Company expects to reach the first unblinding in mid-2026, in addition to the second and final unblinding of Part A, which is expected in the second half of 2026.

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In February 2026 we reported a blinded preliminary composite complete remission rate of 40% in the MIRACLE trial's first 30 subjects treated and with blinded, preliminary efficacy data. This CRc rate is comprised of a complete remission rate of 30% and complete remission with partial hematological recovery (CRh or CRi) of 10%. MIRACLE is randomizing 1:1:1 the three different arms described above. This includes the control arm of cytarabine plus placebo. Even with the control arm included, these preliminary, blinded results substantially outperform historical outcomes for CR with cytarabine alone in the treatment of R/R AML. Of particular note is that roughly 35% of the subjects treated to date are relapsed or refractory from a venetoclax regimen, a subject population that is generally considered among the most challenging to address with 2<sup>nd</sup> line therapies. The subjects treated to date presented with a high degree of genetic markers that are considered predictive of poor treatment response. These efficacy rates were observed across six different countries.

As previously mentioned, the Company expects to have the first interim unblinding in mid-2026. As such, the preliminary blinded data discussed above may differ from the final locked data in the first and second unblinding. Recruitment of the second group of 45 subjects in Part A will continue uninterrupted while the first 45 subjects' data are being analyzed by the Data Safety Monitoring Committee for MIRACLE. Unblinding for the full 90 subjects in Part A may require more time than for the first interim unblinding as it involves more data to support the transition from Part A to Part B.

For Part B of the trial, 222 additional subjects will be randomized to receive either HiDAC plus placebo or HiDAC plus the optimum dose of Annamycin (randomized 1:1). The selection of the optimum dose will be based on the overall balance of safety, pharmacokinetics and efficacy, consistent with the FDA's new Project Optimus initiative. Data from the control arm and the optimum dose of Annamycin chosen in the Phase 2B portion of the trial will be combined with the data for the Phase 3 portion of the trial in determining efficacy and safety.

*Annamycin Clinical Trials* – *STS Lung Metastases*

It is estimated that there are approximately 36,000 new cases of STS in the seven major markets (US, EU5 and Japan) each year. Our clinical advisors estimate that approximately half of all STS patients will eventually develop lung metastases from their primary tumor. Although first-line treatments such as surgical resection, chemotherapy and radiation may provide initial therapeutic benefit for approximately one third of those patients, there are no approved or emerging second-line therapies for the remaining patients who relapse or are refractory. Although the lungs tend to be a major site of relapse, when we began our own clinical trial MB-107 using Annamycin against STS lung metastases, we were aware of only a very few active clinical trials specifically targeting STS lung metastases, indicating that Annamycin currently faces limited competition in this area of development. In the following trials, certain subject data were examined by our Expert regarding possible cardiotoxicity, and the Expert noted that there was no evidence of cardiotoxicity.

<u>MB-107</u>**:** In December 2020, the FDA allowed our IND to go into effect to study Annamycin for the treatment of soft tissue sarcoma lung metastases. This allowed us to begin a Phase 1b/2 clinical trial in the US for subjects with STS lung metastases after first-line therapy for their disease. The trial began in the first half of 2021. The Phase 1B was concluded in July 2022. On September 21, 2023, we announced the completion of enrollment in the Phase 2 portion of our U.S. Phase 1B/2 clinical trial evaluating Annamycin as monotherapy for the treatment of soft tissue sarcoma lung metastases.

In the Phase 1B portion of the trial, subjects were treated from 210 mg/m<sup>2</sup> to 390 mg/m<sup>2</sup> in a single dose of Annamycin. In the Phase 2 portion of the trial, an exploratory RP2D of 360 mg/m<sup>2</sup> was initiated for the first 3 subjects and a final RP2D of 330 mg/m<sup>2</sup> was determined and 15 subjects were treated.

All subjects had pulmonary metastases from soft tissue sarcoma and at least one prior therapy. There was no limit on how many prior therapies a subject could have prior to entering this study. Most subjects were heavily treated with other therapies prior to entering our trial with our treatment representing the seventh median therapy for all subjects in the Phase 1B and Phase 2 portion of the trial (range of two to twelve). A total of 36 subjects, 19 and 17 subjects for Phase 1B and Phase 2 portions of the study respectively, were recruited for MB-107. In the first quarter of 2025, we completed the CSR for MB-107 as median OS had been reached in 2024.

The trial demonstrated median OS of 13.5 mos (n=36) as median 7th line therapy. PFS was 122 days (n=18) as median 7<sup>th</sup> line therapy as well. This is significant as historical rates for OS for standard of care and experimental treatment for 2nd line therapy for STS yielded 8 to 13.4 months, respectively (Comandone A, et al; "Salvage Therapy in Advanced Adult Soft Tissue Sarcoma: A Systematic Review and Meta-Analysis of Randomized Trials"; The Oncologist 2017;22:1518–1527).

<u>IIT STS Lung Mets or Rutkowski Trial NIO-0002</u>**<u>:</u>** We have collaborated with physicians in Poland at the Maria Sklodowska-Curie National Research Institute of Oncology (MSCNRIO) and are currently supporting a physician-sponsored (externally funded) clinical trial there with study drug. We previously announced their facilitation of a grant equivalent to $1.5 million to fund a Phase 1B/2 clinical trial of Annamycin for the treatment of STS lung metastases. The grant-funded clinical trial is led by Prof. Piotr Rutkowski, MD, PhD, Head of Department of Soft Tissue/Bone Sarcoma and Melanoma at MSCNRIO, and it is operated independently of our study in the US. Recruitment in this trial has closed and subjects are being followed for safety and efficacy data.

This trial began dosing subjects in late 2022 with 8 subjects across 2 dose cohorts enrolled. The trial had a dosing regimen of once per week rather than once every 21 days as in the US trial (three in cohort 1 at 35 mg/m2; five in Cohort 2 at 60 mg/m2). The preliminary data to date are 63% (5 of 8) have received greater at least two cycles (approximately 2 months) of therapy where we have assumed stable disease (SD) through two cycles and 38% (3 of 8) subjects received 4 cycles (with us assuming SD through four cycles). The data are preliminary and subject to change. We are expecting a CSR or its equivalent to be published in 2026. As this is an IIT, we are not in control of the progress of the analysis and reporting of the data.

Along with the results in STS lung metastases, our animal models have shown activity in other lung metastases, including osteosarcoma, colorectal and triple negative breast cancer, as well as meaningful concentration levels of Annamycin in the liver, spleen and pancreas. Additionally, when tested in a highly aggressive AML mouse model, Annamycin significantly reduced tumor burden in the spleen, lungs, and liver, leading to an increase in survival. Based on these promising preclinical data, we believe the ultimate market opportunity for Annamycin could be larger than just STS lung metastases. As such, we may expand our clinical trials into these areas in the near term using externally funded trials.

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*Annamycin Clinical Trial* – *Pancreatic Cancer*

In October 2025, we agreed to plan preparation of an IND in 2026 with Atlantic Health's input on an investigator-initiated Phase 1B/2 single-arm study evaluating Annamycin for third-line ("3L") treatment of advanced pancreatic cancer. Pancreatic cancer continues to present significant treatment challenges, being the cancer with the highest mortality rate globally and the seventh leading cause of cancer death. However, recent preclinical studies indicate that Annamycin may target critical factors associated with this disease, showcasing its potential as a novel therapeutic option. Atlantic Health's interest in funding and conducting this study stems from the preclinical data presented at several American Association for Cancer Research conferences showing a high level of activity by Annamycin against pancreatic cancer and associated liver metastases in preclinical studies. We believe this may be related to Annamycin's demonstrated high affinity for and ability to concentrate in the pancreas, especially considering the well-documented challenge of achieving adequate drug uptake to the pancreas with existing therapies. In addition, recent published data now reveal that the upregulation of topoisomerase II, the primary target of Annamycin, is highly correlated with poor survival in pancreatic cancer patients, so we have a highly validated target with pancreatic cancer. Coupled with Annamycin's demonstrated lack of cardiotoxicity, which could enable, for the first time ever, the use of an anthracycline in chronic or maintenance therapies, we believe pancreatic cancer could be an important additional opportunity for Annamycin. Such maintenance therapy demonstrated promising results in a recently concluded clinical study with Annamycin for the treatment of soft tissue sarcoma metastasized to the lungs (MB-107).

In connection with the planned study, we will supply Annamycin and be responsible for submitting and maintaining an IND with the FDA, and Atlantic Health will be responsible for conducting the Phase 1B/2 study. Moleculin estimates the additional cost to run this trial from 2026 into 2030 (for long-term follow-up) will be approximately $1 million, mainly for drug supply and outside laboratory testing.

<u>The WP1066 Portfolio Program</u> 

We have a license agreement with MD Anderson pursuant to which we have been granted a royalty-bearing, worldwide, exclusive license for the patent and technology rights related to our WP1066 Portfolio and its close analogs: molecules targeting the modulation of key oncogenic transcription factors. Additionally, we are coinventors with MD Anderson on the WP1066 intravenous formulations (WP1066IV) technology, discussed further below, and, as such, have our own rights. We do have exclusive, worldwide rights to an option on MD Anderson's WP1066IV coinventor rights. This option is tied to our continued sponsored research with MD Anderson discussed elsewhere. In 2019, the FDA granted ODD for WP1066 for the treatment of glioblastoma, which means the agency believes, in part, that we have established a medically plausible basis for using the drug to treat glioblastoma.

We believe our WP1066 Portfolio (including lead drug candidates WP1066 and WP1220), represents a novel class of agents capable of hitting multiple targets, including the activated form of a key oncogenic transcription factor, STAT3. A substantial body of published research has identified STAT3 as a master regulator of a wide range of tumors and has linked the activated form, p-STAT3, with the survival and progression of these tumors. For this reason, it is believed that targeted inhibition of p-STAT3 may be an effective way to reduce or eliminate the progression of these diseases. Since 2020, we have been working on developing an appropriate IV formulation for WP1066 or its analogs. As a result of these studies, we believe we have now identified a candidate formulation that is worthy of IND-enabling preclinical testing, which is now underway. Furthermore, we retained an option to license WP1732 but in January 2024 we notified MD Anderson of our intent to terminate the option.

The high level of anticancer activity demonstrated in multiple tumors in animal models by WP1066 is potentially related to its ability to also inhibit such important key oncogenic transcription factors such as c-Myc and HIF-1α. In addition to direct anticancer effects not related to the function of the immune system, our lead drug candidate WP1066 has also been shown to boost immune response in animals, in part by inhibiting activity of TRegs, which are coopted by tumors to evade the immune system. We believe the dual effect of (1) directly inhibiting tumor growth and inducing tumor cell death and (2) separately boosting and directing the natural immune response to tumors is therapeutically promising. If additional preclinical and clinical data validate these two avenues of apparent activity, this class of drugs may be well-suited to treat a wide range of tumors, both as single agents and as critical elements of successful combination therapies targeting even some of the most difficult-to-treat cancers.

The recent oncology drug landscape has been dominated by immunotherapy, specifically including checkpoint inhibitors. In the last 5 years, checkpoint inhibitors (such as Opdivo and Keytruda) have reached over $10 billion in annual revenues. To summarize checkpoint blockade therapy, the T-Cells within an individual's own immune systems should be capable of identifying tumor cells and destroying them before they destroy the individual. Unfortunately, tumors develop the ability to prevent this natural immune response by regulating the expression of certain receptors referred to as "immune checkpoints" that then bind to T-Cells and prevent them from attacking the tumor. Immune checkpoint inhibitors are antibodies that block these receptor mechanisms and allow the T-Cells to act normally and attack the tumor.

In certain types of tumors, like melanoma, checkpoint inhibitors work well, and the results can be impressive, creating durable suppression of tumors where no other therapy had succeeded. However, despite the outstanding results in select patients, checkpoint inhibitors benefit only a limited number of patients in certain cancers, and they are essentially not effective in what are called "non-responsive" tumors like glioblastoma and pancreatic cancer, among others. As a result, companies are now focusing heavily on combination therapies, combining immune checkpoint inhibitors with chemotherapy, as well as other agents. We believe there is a need for new chemotherapeutic agents that, by their specific mechanism of action, would produce potent combination effects with immune checkpoint inhibitors, and that additionally can boost immune system response on their own. In this regard, there is early preclinical evidence that WP1066, as a single agent, may have the ability to reverse immune tolerance in brain tumor patients (Cancer Res, 67(20), 9630, 2007), and preliminary data in animal models that suggests WP1066 may have a potential for combination use with checkpoint inhibitors. We intend to pursue additional externally funded studies to build on this preclinical evidence and preliminary animal model data.

Published research papers have presented several findings that may point to new opportunities for our WP1066 class of drugs. One such article suggested that our STAT3 inhibitor WP1066 abrogated PD-L1/2 expression in cancer cells and may be a useful agent in addition to checkpoint inhibitor immunotherapy in cancer patients (J Clin Exp Hematop, 57(1), 21-25, 2017). Other published results show that CTLA4-induced immune suppression occurs primarily via an intrinsic STAT3 pathway, suggesting that, through its inhibition of activated STAT3, WP1066 might work well in combination with this checkpoint inhibitor (Cancer Res, 77(18), 5118–28, 2017).

A separate paper presents selected key transcription factors as being responsible for the upregulation of an often-targeted checkpoint actor in tumors known as PD-L1. Some of the most important transcription factors identified were HIF-1α, c-Myc and STAT3, the very targets for which WP1066 was designed (Front Pharmacol, 2018 May 22, 9:536, doi: 10.3389/ fphar.2018.00536, eCollection 2018).

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*WP1066*

WP1066 is our flagship Immune/Transcription Modulator. It has been the subject of over 50 peer-reviewed articles and its activity against p-STAT3 has now been validated in independent labs around the world. This discovery was inspired by a naturally occurring compound (caffeic acid) in propolis (from honeybees). Caffeic acid has shown a natural ability to inhibit p-STAT3, which is considered a master regulator of inflammatory processes that support tumor survival and proliferation.

WP1066 has exhibited an ability to inhibit other key oncogenic transcription factors, including c-Myc and HIF-1α. A critical characteristic of WP1066 and its analogs is the ability to inhibit p-STAT3 independently of upstream cell signaling. We believe this overcomes the limitations of many other drugs designed to inhibit STAT3 activity by blocking upstream receptors.

Another important attribute of WP1066 (unlike some of our other Immune/Transcription Modulators) is its apparent ability in pre-clinical testing to cross the blood brain barrier, which we believe makes it a good candidate for potentially treating brain tumors and other malignancies of the central nervous system. WP1066 has shown significant anti-tumor activity and increased survival in a wide range of tumor cell lines and animal models.

As with other analogs in this portfolio, WP1066 also has demonstrated in animal models the ability to boost a natural immune response to tumor activity. In animal models, WP1066 has been shown to upregulate STAT1, a transcription factor associated with immune stimulation. At the same time, it has been shown to reduce levels of Regulatory T-Cells, or TRegs, which are coopted by tumors to protect themselves from attack by the patient's natural immune system. This forms a unique dual action (directly attacking the transcription factors that support tumor development and separately boosting the natural immune response to tumors) that may make WP1066 well suited to treat a wide range of tumors and possibly also serve as an important element in combination therapies targeting some of the most difficult cancers.

In vitro testing has shown a high level of activity for WP1066 against a wide range of solid tumors, and in vivo testing has shown significant activity against head and neck, pancreatic, stomach, and renal cancers, as well as metastatic melanoma and glioblastoma, among others. In vivo testing in mouse tumor models indicates that WP1066 inhibits tumor growth, blocks angiogenesis (a process that leads to the formation of blood vasculature needed for tumor growth) and increases survival.

Our own sponsored research and published findings from independent researchers point to the possibility that administration of WP1066 could lead to improved treatment results in many patients receiving checkpoint inhibitor therapy. Additionally, in April 2019 we announced that preclinical data supporting activity of our STAT3-inhibiting Immune/Transcription Modulators was presented by Dr. Waldemar Priebe, our co-founder and chair of our Scientific Advisory Board, at the 2019 Annual Meeting of the American Association for Cancer Research (AACR) in Atlanta, GA. The abstract (AACR Abstract: https://www.moleculin.com/inhibition-of-stat3-in-pancreatic-ductal-adenocarcinoma-and-immunotherapeutic-implications/) and the presentation included data resulting from preclinical evaluation in pancreatic cancer models of the STAT3 inhibitor WP1066. In vitro efficacy of this inhibitor was assessed using proliferation and apoptosis induction assays in a panel of patient-derived and commercially available Pancreatic Ductal Adenocarcinoma (PDAC) cell lines. WP1066 was shown to be potent and to induce apoptosis and inhibit p-STAT3 and its nuclear localization in all tested PDAC cell lines. Observed IC50 values ranged from 0.5 to 2 μM. Importantly, WP1066 shows in-vivo efficacy in preliminary experiments when tested alone or in combination with T cell immune checkpoint inhibitors.

*Clinical Trials for the WP1066 Portfolio*

At the 2019 annual meeting of the Society for Neuro Oncology (SNO), Emory University researchers reported encouraging activity in animals with their in vitro pediatric brain tumor models using WP1066. Based on these data, they filed and received clearance to proceed with an IND for a trial to treat children with recurrent or refractory malignant brain tumors with WP1066. This trial is being conducted at the Aflac Cancer & Blood Disorders Center at Children's Healthcare of Atlanta (Emory).

In February 2023, the Emory physician-sponsored clinical trial for the treatment of pediatric brain tumors with an oral formulation of WP1066 concluded. Final positive results were announced in December 2025 from the Emory's physician-sponsored Phase 1 clinical trial. The results of this first-in-child trial show some encouraging signals of activity in a highly aggressive chemotherapy resistant brain cancer, such as partial tumor response in a diffuse intrinsic pontine glioma (DIPG) patient and clear anti-tumor immune changes.

For the Phase 1 trial, 10 children were treated with WP1066 twice daily for 14 days to determine the maximum feasible dose. Compassionate use treatment in three children with high-grade glioma was also evaluated. Results showed there was no significant toxicity, and a maximum feasible dose was determined. Importantly, WP1066 suppressed the expression of STAT3, inhibiting its activity and demonstrating anti-tumor immune responses.

While the preclinical efficacy of WP1066 had been previously demonstrated, and its effectiveness had been studied among adults, this trial was the first to test it in children. The study recruited pediatric patients with high-grade glioma, which include diffuse midline glioma (DMG) and DIPG, and account for most pediatric brain tumor-related deaths. Both DMG and DIPG have an average survival rate of nine to 11 months following diagnosis. Additionally, patients with relapsed medulloblastoma and ependymoma who have no accepted standard therapy following a relapse were also included in the study.

Results from the study were recently published in the Journal of Clinical Investigation Insight*.* For more information about the WP1066 Phase 1 clinical trial, visit clinicaltrials.gov and reference identifier NCT04334863. We believe that these results, along with our discussions with Emory, are setting the basis for a Phase 2 IIT trial at Emory in late 2026 or early 2027.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *WP1220* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; An analog of WP1066, referred to as WP1220, was previously the subject of an IND (WP1220 was referred to as "MOL4239" for purposes of this IND) related to use of the molecule in the topical treatment of psoriasis. Clinical trials were commenced on WP1220 in the US but were terminated early due to limited efficacy in the topical treatment of psoriatic plaques. Notwithstanding its limitations in treating psoriasis, our pre-clinical research in multiple CTCL cell lines has suggested that WP1220 may be effective in inhibiting CTCL. Based on these data, we are open to discussions with various pharmaceutical companies for further development of this molecule. CTCL is a potentially deadly form of skin cancer for which there are limited treatment options.

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*Clinical Activity WP1220* 

In February 2020, we announced the final data from our CTCL clinical trial of WP1220, which were published and presented by Dr. M. Sokolowska-Wojdylo in conjunction with the 4th Annual World Congress of Cutaneous Lymphomas in Barcelona, Spain on February 13, 2020. The final results supported the safety of topical WP1220 and demonstrated an improvement in the Composite Assessment of Index Lesion Severity (CAILS) score.

Mycosis Fungoides or MF, the most common variant of CTCL, is a disease with symptomatic, disfiguring skin lesions. STAT3, an oncogenic transcription factor, has been identified as a critical regulator of MF, whereby the activation of STAT3 through phosphorylation (p-STAT3) has been linked to tumor proliferation and suppression of immune responses. Preclinical testing demonstrated that WP1220, a synthetic compound, potently inhibits the activity of p-STAT3 and the growth of CTCL cell lines. This Phase 1 study was designed to demonstrate the safety and efficacy of WP1220 after topical treatment of CTCL.

Of five subjects enrolled, eleven lesions were assessed according to the CAILS scoring system. The only related AE was mild contact dermatitis in one subject that the investigator deemed was not related to the drug. Four of the five subjects improved in CAILS scores on index lesions, with one exhibiting stable disease, with a median reduction of 56% (range 25-94%). Three of the subjects exhibited a PR. Improvement was noted within seven days of treatment initiation and maintained 1 month after discontinuation. Of the eleven lesions, 45% exhibited a CR or a 50% or more reduction in CAILS and 55% exhibited stable disease with 100% showing a clinical benefit. Independent dermatologic review based on photographic documentation was conducted and corroborated these findings.

Although this was a small proof-of-concept clinical trial, topically applied WP1220 had no safety issues and appeared to be effective in MF. Topical application of WP1220 does not appear to result in systemic exposure to the drug, which is desirable in the case of a topical drug targeting a dermatologic condition.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *Alternate Formulation for the WP1066 Portfolio*

WP1220 and its close analogs are highly insoluble compounds and as such, WP1066 is currently administered orally. Unfortunately, the present formulation has an undesirable taste profile, and its bioavailability when delivered orally may not be optimum. Although preliminary data from physician-sponsored brain tumor trials indicate that the oral administration of WP1066 results in detectable levels of WP1066 in plasma, we believe our opportunity for successful development of a p-STAT3 inhibitor would be expanded if we were able to develop a compound capable of a different oral delivery or intravenous (IV) administration (WP1066IV). In 2020, we began developing IV formulation methods for WP1066 and/or its analogs that might address these issues. Recently, we have succeeded in identifying a promising candidate for IV formulation, filed appropriate patents, and we have begun IND-enabling preclinical work. However, there can be no assurance that this effort will be successful. Such preclinical work is being performed under material transfer agreements with Emory University and the University of North Carolina.

<u>The WP1122 Portfolio Program</u>

We have agreements with MD Anderson pursuant to which we have the rights to the technology related to our WP1122 Portfolio and similar molecules focused on inhibitors of glycolysis and glycosylation. These new compounds are designed to exploit the potential uses of inhibitors of glycolysis such as 2-deoxy-D-glucose (2-DG), which we believe may provide an opportunity to stop the fuel supply of tumors by taking advantage of their high level of dependence on glucose in comparison to healthy cells. A key drawback to 2-DG is its lack of drug-like properties, including a short circulation time and poor tissue/organ distribution characteristics. Our lead Metabolism/Glycosylation Inhibitor, WP1122, is a prodrug of 2-DG that appears to improve the drug-like properties of 2-DG by increasing its circulation time and improving tissue/organ distribution. New research also points to the potential for 2-DG to be capable of enhancing the usefulness of checkpoint inhibitors. Considering that we believe 2-DG lacks sufficient drug-like properties to be practical in a clinical setting, we believe WP1122 has the opportunity to become an important drug to potentiate existing therapies.

We believe this technology has the potential to target a wide variety of solid tumors, which eventually become resistant to all treatments, and thereby provide a large and important opportunity for novel drugs. Notwithstanding this potential, we are currently focused on the use of WP1122 and related analogs for the treatment of central nervous system malignancies and especially glioblastoma multiforme. Although less prevalent than some larger categories of solid tumors, cancers of the central nervous system are particularly aggressive and resistant to treatment. The prognosis for such patients can be particularly grim and the treatment options available to their physicians are among the most limited of any cancer. The American Cancer Society has estimated 24,820 new cases of brain and other nervous system cancers will occur in the United States in 2025, resulting in 18,330 deaths (https://www.cancer.org/research/cancer-facts-statistics/all-cancer-facts-figures/2025-cancer-facts-figures.html). Despite the severity and poor prognosis of these tumors, there are few FDA-approved drugs on the market.

Additionally, based on independent preclinical data, we believe this technology has the potential to impact hard to treat viruses that also rely heavily on glycolysis and glycosylation. Due to the COVID-19 pandemic, we established a recommended Phase 2 dose for WP1122 in a Phase 1 clinical in the United Kingdom.

*Activities with WP1122* 

In 2021, we received authorization from the MHRA to commence a Phase 1a clinical trial of WP1122 in the United Kingdom. The Phase 1a study in healthy human volunteers investigated the effects of a single ascending dose (SAD) and multiple days of ascending dosing (MAD) of WP1122 administered as an oral solution. In 2022, we determined with the data from the Phase 1a trial that the maximum tolerated dose (MTD) for WP1122 is a daily cumulative dose of 32 mg/kg in two divided doses for seven days, and we concluded the Phase 1a study of WP1122. We believe this will be a basis for potential future studies of WP1122 in antiviral and oncology indications, if such studies ever occur. We have concluded and published the clinical study report for this trial.

We concluded that advancing WP1122 in these indications would occur only if external funds were available and opened an IND for WP1122 for the treatment of glioblastoma in 2021. Due to the focus of our resources on our lead drug candidate, we inactivated that IND with the FDA in October 2025. As the opportunity arises, we expect to rely on external collaborations for testing other molecules in the WP1122 portfolio against other hard to treat viruses such as HIV, Dengue fever, and Zika.

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**Funding Strategy**

By "internally funded" we mean that the primary costs of the preclinical activity and clinical trials are funded and sponsored by us. By "externally funded" we mean that the preclinical work is performed by external collaborators and the clinical trials are physician-sponsored or IITs. For externally funded research, any grant funds that support such preclinical work or clinical trials and most of the associated expenses do not flow through our financial statements. For externally funded preclinical activities and clinical trials, we do provide drug product and other supporting activities for which costs are shown in our financial statements. Of the eighteen clinical trials in planning, approved, conducted or in process six have been IIT funded trials.

**Working Environment**

Our headquarters and laboratory are in Houston, Texas, and our workforce, as of year-end 2025, consisted of 17 full and part-time employees in the US, which are leveraged with other service providers and contractors worldwide working in a primarily virtual environment. We do not have manufacturing facilities, and all manufacturing activities are contracted out to third parties. Additionally, we do not have a sales organization. Our overall strategy is to seek the best value for our shareholders either via potential outlicensing or collaborative opportunities with other pharmaceutical companies with existing marketing, sales and distribution or via the development of contracted marketing, sales and distribution capability if and when our drugs are approved.

War, terrorism, pandemics or the like, geopolitical uncertainties (such as the current war in Ukraine) and other business interruptions could cause damage to, disrupt or cancel the conduct of our clinical trials on a global or regional basis, which could have a material adverse effect on our business, clinical sites, drug suppliers or vendors with which we do business. Such events could also decrease the availability of subjects interested or able to enroll in our clinical trials or make it difficult or impossible for us to deliver products and services to our clinical investigational sites. In addition, territorial invasions can lead to cybersecurity attacks on technology companies, such as ours, located outside of the conflict zone. In the event of prolonged business interruptions due to geopolitical events, we could incur significant losses, require substantial recovery time and experience significant expenditures in order to resume our business or clinical operations. While having operations in neighboring Poland, we have no operations directly in Russia. However, we do conduct a material portion of our MIRACLE trial in Ukraine and Eastern Europe. We do not and cannot know if the current uncertainties in these geopolitical areas, which are unfolding in real-time, will escalate and result in broad economic and security conditions or rationing of medical supplies or production facilities, which could limit our ability to conduct clinical trials or result in material implications for our business. In addition, our insurance policies typically contain a war exclusion of some description, and we do not know how our insurers are likely to respond in the event of a loss alleged to have been caused by geopolitical uncertainties.

We cannot determine whether these events will materially impact our overall business and operations, recruitment, and our drug supply in the future.

**Manufacturing**

We do not own or operate manufacturing facilities for the production of active pharmaceutical ingredients (API) or final drug products for our product candidates. We have elected to rely on third-party contract manufacturers for all aspects of API manufacturing and drug product formulation, both for clinical development and, if approved, commercial production.

For our lead product candidate, Annamycin, we currently utilize a single contract manufacturer to supply API and a separate single contract manufacturer for final drug product formulation. We have entered into manufacturing agreements with these third-party manufacturers to supply API and drug product for our clinical trials. We expect to continue to rely on third-party contract manufacturers to produce API and final drug product in quantities sufficient to support our clinical development programs and, if our product candidates receive regulatory approval, commercial supply.

Our product candidates require technically complex manufacturing processes. The API and drug product for our product candidates must be manufactured in accordance with current Good Manufacturing Practice (GMP) regulations enforced by the FDA and comparable standards required by other regulatory authorities. We are responsible for ensuring that our contract manufacturers comply with applicable cGMP requirements and other regulatory standards.

We are required to provide our contract manufacturers with manufacturing forecasts significantly in advance of delivery dates to ensure adequate supply for our clinical trials. We work closely with our manufacturers to coordinate production schedules with our clinical development timelines and to maintain appropriate inventory levels.

Given the limited number of contract manufacturers that operate under cGMP regulations and are capable of manufacturing our product candidates, we may face competition for manufacturing capacity. While we currently do not have qualified backup manufacturers for our product candidates, we continue to evaluate our manufacturing strategy and may engage additional or alternative contract manufacturers as our development programs advance. The identification and qualification of alternative manufacturers, if needed, would require regulatory approval and could involve manufacturing comparability studies.

**Our Intellectual Property, FDA Designations and License Agreements**

We have obtained worldwide, exclusive licenses or options to license from MD Anderson to issued US patents and pending US patent applications for each of our drug candidates, as well as pending foreign patent applications or issued foreign patents. With respect to certain patents or patent applications, we are co-owners (due to being coinventors) with MD Anderson, in which instances we have exclusively licensed MD Anderson's rights in those patents or patent applications. Where MD Anderson has sole ownership of patents licensed to us, MD Anderson is responsible for the prosecution and maintenance of those patent applications, with input from us and at our expense. Where MD Anderson jointly owns patent applications with us, we are responsible for prosecution and maintenance of those patents and patent applications at our expense. If we choose to not prosecute or maintain patents in certain geographical areas, MD Anderson has the right to pursue those rights separate from us. To date, no geographical areas in which we have chosen to not prosecute or maintain such patents have been pursued to date separately from us by MD Anderson.

As new discoveries arise with respect to our drug candidates, we and MD Anderson seek to protect our rights to those inventions by filing new patent applications. There can be no assurance that patent applications will issue as patents or, with respect to issued patents, that they will provide us with significant protection.

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Issued patents generally expire 20 years after their filing date, subject to adjustment or extension under certain circumstances. For instance, the expiration of US patents may be adjusted to account for prosecution delays, if any, by the United States Patent and Trademark Office (USPTO). Some jurisdictions, including the US and countries belonging to the European Patent Convention, will extend the expiration of an unexpired patent for an approved pharmaceutical product by some portion of time required for clinical development and regulatory review. We intend to seek patent term extensions for patents claiming our product candidates where available. In addition, certain pharmaceutical regulatory bodies, including the US FDA and the EMA, provide some period of exclusivity for new pharmaceutical products independent of patent protection. In the US, regulatory exclusivity can range from three (3) years for a product with a previously approved active pharmaceutical ingredient to seven (7) years for a novel product designated as an Orphan Drug.

We have obtained ODD from the FDA for Annamycin for the treatment of AML and STS; for WP1066 for the treatment of GBM; and, for WP1122 for the treatment of GBM. We have other FDA designations as discussed below. Detailed discussion of potentially relevant regulatory exclusivities can be found under Regulatory Exclusivities below.

The following provides a general description of our patent portfolio and is not intended to represent an assessment of claim limitations or claim scope.

<u>Annamycin</u>

On April 9, 2024, the United States Patent and Trademark Office (USPTO) issued U.S. Patent number 11,951,118 titled, "*Preparation of Preliposomal Annamycin Lyophilizate*" (the '118 patent') to Moleculin and The University of Texas System Board of Regents. On March 25, 2025 the USPTO issued U.S. Patent number 12,257,261, also titled "*Preparation of Preliposomal Annamycin Lyophilizate*" (the '261 patent) to Moleculin and The University of Texas System Board of Regents. Additionally on May 14, 2024, the USPTO issued an additional patent (U.S. Patent number 11,980,634) titled "*Method of Reconstituting Liposomal Annamycin*" (the '634 patent') and on March 25, 2025 the USPTO issued U.S. Patent number 12,257,262 titled "*Method of Reconstituting Liposomal Annamycin*" (the '262 patent) to Moleculin and the University of Texas Board of Regents. We have global, exclusive licenses MD Anderson's interests to both patents.

The '118 and '261 patents provide claims to compositions that contain Annamycin, and the '634 and '262 patents provide claims to liposomal Annamycin suspension compositions, all with a base patent term extending until June 2040, subject to extension to account for time required to fulfill regulatory requirements for FDA approval. Moleculin's novel candidate for the treatment of AML and STS uses a unique lipid-based delivery technology. In addition to the four issued U.S. patents, we have additional patent applications pending in the US and in major jurisdictions worldwide.

<u>p-STAT3 Inhibitors</u>

WP1066. We have rights to four issued US patents for WP1066. These patents claim WP1066 and other molecules, as well as methods of treating disease using WP1066. Foreign counterparts to the US patents are issued outside the US including in Europe. These patents have an international filing date in December 2004, and in certain instances have had the patent term adjusted.

WP1220. We have rights to three issued US patents which claim compositions of WP1220, as well as foreign counterparts. These patents have an international filing date in June 2009. In addition, we have rights to an issued US patent for the treatment of skin disorders using WP1220, with a filing date in September 2009.

<u>WP1122</u>

We have rights to an issued US patent with claims to compositions of WP1122 and methods for treating cancer using WP1122, with an international filing date in June 2009. We also have rights to foreign counterparts. In addition, we have rights to US and foreign patent applications directed to the treatment of viral diseases with WP1122 and other anti-metabolites including WP1096 and WP1097, with a filing date in March 2021. Such rights are incorporated into our sponsored research agreement, discussed elsewhere, with MD Anderson.

<u>FDA Designations</u>

To further enhance our intellectual property, we have the following FDA designations for our drug candidates as shown. The importance of these designations is discussed further below in the section titled *Regulatory Exclusivities*.

---

| | | | |
|:---|:---|:---|:---|
| **Drug Candidate** | **FDA ODD - Indication** | **FTD** | **FDA Rare Pediatric Disease Priority Review Voucher (PRV) Program** |
| **Annamycin** | Yes – AML, Soft Tissue Sarcoma | Yes – AML, Soft Tissue Sarcoma | No  |
| **WP1066** | Yes - GBM | No | Yes – Ependymoma, diffuse intrinsic pontine glioma (DIPG), medulloblastoma and atypical teratoid rhabdoid tumor |
| **WP1122** | Yes - GBM | Yes - GBM | No |

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<u>Our License Agreements</u>

<u>Sponsored Research and License Agreements with MD Anderson</u>

We have a license or an option to license our technology from MD Anderson, and we also sponsor research there as well. Under our agreements with MD Anderson, discussed above, we are responsible for certain license, milestone and royalty payments over the course of the agreements. Annual license fees, prior to the first sale of a licensed product, can be as high as $0.1 million depending upon the anniversary. Milestone payments for the commencement of phase II and phase III clinical trials can cost as high as $0.5 million. Other milestone payments for submission of an NDA to the FDA and receipt of first marketing approval for sale of a license product can be as high as $0.6 million. Certain agreements contain a milestone payment for the initiation of Phase 3 clinical trials. Royalty payments can range in the single digits as a percent of net sales on drug products or flat fees as high as $0.6 million, depending upon certain terms and conditions. Not all payments are applicable to every drug. Total expenses under these agreements were $0.2 and $0.3 million, for the years ended December 31, 2025 and 2024, respectively. Such costs are expected to increase as development of Annamycin progresses. For more information about our license agreements, see Footnote 8 - Commitments and Contingencies included in our Consolidated Financial Statements set forth in this report.

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We have a sponsored research agreement with MD Anderson that currently runs until March 31, 2027 and is expected to be extended, however there can be no assurance that this effort will be successful. In addition, the Company also has Sponsored Research Agreements with other universities, one in the US and one in Europe. The expenses recognized under the agreements, mainly related to MD Anderson, were $2.0 million and $0.8 million for the years ended December 31, 2025 and 2024, respectively.

<u>Animal Life Sciences Licensing Agreement</u>

On February 19, 2019, we sublicensed certain intellectual property rights, including rights to Annamycin, our WP1122 portfolio, and our WP1066 portfolio in the field of non-human animals to Animal Life Sciences, LLC (ALI) (the "ALI Agreement"). ALI is affiliated with Dr. Waldemar Priebe, one of our founders. Under the ALI Agreement, we granted ALI a worldwide royalty-bearing, exclusive license to research, develop, manufacture, have manufactured, use, import, offer to sell and/or sell products in the field of non-human animals under the licensed intellectual property. This license is subject to the terms in the prior agreements entered into by the Company and MD Anderson. With regard to Annamycin, we have completed a Phase 2 clinical trial. As such, ALI has to commence commercially reasonable efforts to commercialize non-human uses of Annamycin by 2028 or it may lose such rights to Annamycin.

During the term of the ALI Agreement, to the extent we are required to make any payments to MD Anderson pursuant to our license agreements with MD Anderson, whether a milestone or royalty payment, as a result of the research and development or sale of a sublicensed product, ALI shall be required to advance or reimburse us such payments. In further consideration for the rights granted by us to ALI under the ALI Agreement, ALI agreed to pay us a royalty percentage at a rate equal to the royalty rate we owe MD Anderson under our license agreements with MD Anderson plus an additional royalty equal to 5.0% of net sales of any sublicensed products. As additional consideration, ALI issued us a 10% ownership interest in ALI.

With certain exceptions, the ALI Agreement will remain in full force and effect until the expiration of the last patent within the sublicensed patents.

**Overview of The Market for Our Oncology Drugs**

The American Cancer Society (https://www.cancer.org/research/cancer-facts-statistics/all-cancer-facts-figures/2025-cancer-facts-figures.html) estimates that cancer continues to be the second most common cause of death in the US, after heart disease. A total of 2.0 million new cancer cases and 618,120 deaths from cancer are expected to occur in the US in 2025, which is about 1,693 deaths a day. These statistics do not include either basal cell or squamous cell skin cancers because US cancer registries are not required to collect information on these cancers. These numbers also do not account for the effect the COVID-19 pandemic has likely had on cancer diagnoses and deaths because they are projections based on reported cases through 2021 and deaths through 2022.

<u>Market for Annamycin</u> 

Per the American Cancer Society, digestive, reproductive, breast and respiratory cancers comprise most of expected cancer diagnoses in 2024, while cancers like leukemia and brain tumors are considered "rare diseases." Leukemia in particular, can be divided into acute, chronic and other, with acute lymphoblastic leukemia (ALL) and AML comprising 28,110 of the estimated 66,890 new cases expected in the United States in 2025. The National Cancer Institute estimates that cancer-related direct medical costs in the US were $208.9 billion in 2020, which is likely an underestimate because it does not account for the growing cost of treatment; for example, the list price for many prescription medicines is now more than $100,000 annually.

Our lead drug candidate, Annamycin, is in a class of drugs referred to as anthracyclines, which are chemotherapy drugs designed to destroy the DNA of targeted cancer cells. The approved anthracyclines most commonly used are daunorubicin and doxorubicin and world-wide annual revenues, mostly generic, generated from anthracyclines were estimated in 2023 to approximate $1.3 billion (https://www.globenewswire.com/news-release/2025/01/13/3008751/28124/en/Liposomal-Doxorubicin-Market-Research-and-Forecast-Report-2024-2032-Growing-Investments-and-Collaborations-Personalised-Medicine-Trends-Market-Penetration inEmergingEconomies.html#:~:text=The%20global%20liposomal%20doxorubicin%20market,USD%202%20billion%20by% 202032.) and is expected to grow to $2 billion by 2032. Acute leukemia is one of a number of cancers that are treated with anthracyclines. Of this worldwide amount, the US market is estimated to comprise the largest share.

We believe that pursuing approval as a second line induction therapy for adult relapsed or refractory AML patients is the shortest path to regulatory approval, but we also believe that one of the most important potential uses of Annamycin is in the treatment of children with either AML or ALL (acute lymphoblastic leukemia, which is more common in children). Accordingly, we also intend to pursue approval for pediatric use in these conditions when practicable.

Soft tissue sarcoma is a broad term for cancers that start in soft tissues (muscle, tendons, fat, bone, lymph and blood vessels, and nerves). These cancers can develop anywhere in the body but are found mostly in the arms, legs, chest, and abdomen.

The lungs are the most frequent site of metastasis from soft-tissue sarcomas. It has been estimated that as high as approximately 50% of the STS cases develop lung metastases. Effective systemic therapies for metastatic STS are currently limited; when possible, surgical removal of the lung metastases (known as pulmonary metastatectomy, PM) is the preferred treatment. However, guidelines for the performance of PM for STS do not exist and decisions to operate are often made on an individual basis (American Association for Thoracic Surgery (AATS). (2016, May 16). Increasing survival in soft tissue sarcoma patients with lung metastases undergoing resection. ScienceDaily. Retrieved March 3, 2023 from www.sciencedaily.com/releases/2016/05/160516181330.htm). Metastatectomy and/or chemotherapy are the most common treatments offered to patients with metastatic sarcoma. Pulmonary metastatectomy, either video-assisted or through a formal thoracotomy, has been shown to increase overall survival in select populations of both osseous and soft tissue sarcoma patients. The market is expected to grow as a result of factors like an increase in the patient pool.

We believe that the market size of STS globally was $1.58 billion in 2024 and is expected to grow to $2.57 billion by 2030. According to our estimates, the highest market size of STS with lung metastases was estimated in the United States, followed by Germany (https://finance.yahoo.com/news/2025-research-soft-tissue-sarcoma-124900301.html). The market of STS with lung metastases is categorized into first-line and second-line therapies. The therapies in first-line treatment involve surgery, off-label treatment, and stereotactic radiation therapy (SBRT). We estimate that around 80% of patients taking the first-line treatment due to relapse of the disease progress on to second-line treatment. To our knowledge, there are no approved or emerging therapies for treatment of relapsed/refractory patients, we believe that first-line therapies are often used again in second-line management. Other cancers metastasize to the lungs, including osteosarcoma, breast and colon cancers, for which the relapsed or refractory population is estimated to exceed 8,000 in the US. In addition, there are over 20,000 annual cases of testicular, thyroid, endometrial, renal and cervical cancers which metastasize to the lungs. Given this backdrop, we believe the best initial pathway for Annamycin is to pursue the second-line treatment of STS lung metastasis.

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Per the American Cancer Society, in 2025, an estimated 67,440 new cases of pancreatic cancer will be diagnosed in the US and 51,980 people will die from the disease. While pancreatic cancer only accounts for 3% of all cancer diagnoses, it has the highest mortality rate of all cancers and is the third leading cause of cancer-related deaths in the US, behind lung and colon cancer. The most effective treatment for pancreatic cancer is surgery, but fewer than 20% of cases are eligible for a surgical approach. The 80% of non-resectable pancreatic cancers are typically treated with chemotherapy and other pharmacotherapies.

<u>Market for Our WP1066 (STAT3) Portfolio</u>

Our active development program for WP1066, has potential applications (among others) in the treatment of brain tumors, another rare disease for which there are few available treatments. The leading brain tumor drug is temozolomide, a drug introduced under the brand name Temodar. In 2012, one industry source reported annual revenues of approximately $882 million for Temodar before the expiration of its patent protection, at which point generic versions of the drug began to enter the market and reduce prices.

WP1066 is our most published asset (over 50 peer reviewed articles), and we believe it is one of very few drug candidates in the development focused on the inhibition of p-STAT3, and that its mechanism of action is unique. Clinical research on WP1066 is currently focused on the treatment of adult GBM and childhood brain tumors, including DIPG. An industry recognized data source in late 2020 estimated that the incidence of primary malignant brain and central nervous system tumors in the US is 7.4 cases per 100,000 person-years. This translates to an incidence of approximately 20,000 cases of malignant brain cancer per year. It is estimated that more than 81,000 people were living with a diagnosis of primary malignant brain and central nervous system tumor in the United States in 2000. In Europe in 2002, 33,000 people were diagnosed with primary brain/CNS cancers, and of which 85-90% are brain tumors. Incidence in Asians is significantly lower and based on the results of several large epidemiological studies, we estimate a Japanese incidence of close to 3,000 a year. Gliomas (mainly glioblastoma and astrocytomas) account for 78% of malignant tumors.

Diffuse Intrinsic Pontine Glioma (DIPG) - also called: Pontine Glioma or Brainstem Glioma – is a type of pediatric (6-9 years old) tumor that starts in the brain stem. These tumors are called gliomas because they grow from glial cells, a type of supportive cell in the brain. DIPG falls into the Glioma staging system, so they can be classified according to the four stages below based on how the cells look under the microscope. The grades are from the least severe to the most severe: Low Grade: Grade I or II means that the tumor cells are the closest to normal; and High Grade: Grade III or IV means that these are the most aggressive tumors. The main issue with DIPG is that most of these tumors are not classified by grade because biopsy or removal of the tumor is not safe because of the location of the tumor, so they are diagnosed by their appearance on MRI. Symptoms usually develop rapidly in the majority of subjects because of the fast growth of these tumors. The most common symptoms are issues related to balance and walking; eyes, chewing and swallowing, nausea and vomiting, headaches and facial weakness or drooping (usually one side). 10-20% of all pediatric gliomas are DIPG. DIPG impacts an estimated 200 to 400 children per year in the US alone. After diagnosis, median survival is usually nine months. Only 10% live for more than two years. When compared to pediatric glioblastoma, the prognosis for DIPG is the worst with less overall survival. There are no effective treatments for DIPG.

We believe there is a significant unmet need for an effective treatment for DIPG. While chemotherapy trials of over 200 drugs have not shown any impact on the disease, a DIPG subject in the first cohort of the Emory University study of WP1066 responded to treatment with both a radiologic reduction in tumor size and a clinical improvement in symptoms. While this is only an "n" of one, we believe the response is important and encouraging, especially since we believe this was a subtherapeutic dose level. In December 2020, we announced that the FDA had approved our request for a "Rare Pediatric Disease" designation for our drug candidate WP1066. The designation may entitle us to receive a transferrable Priority Review Voucher upon approval of an NDA for one of three indications, including DIPG, medulloblastoma and atypical teratoid rhabdoid tumor. We believe that the early activity we are seeing in WP1066 is both surprising and encouraging. The approval of these three Rare Pediatric Disease designations is a reminder of just how important our efforts are to potentially help children with brain tumors. These vouchers are issued upon drug approval of the rare disease indication from the FDA and once issued, can be transferred to other drug developers. PRVs have historically had significant value and management believes have a value up to $100 million or more.

<u>Market for Our WP1122 Portfolio</u>

Certain cancers depend heavily on glycolysis and glycosylation for growth and survival. Additionally, viruses depend on glycolysis and glycosylation for infectivity and replication. Glycolysis and glycosylation can be disrupted by using a glucose decoy known as 2-DG. While 2-DG has been shown to be effective in vitro and may have some activity in humans, its lack of drug-like properties limits its efficacy. Based on our preclinical testing in vitro (against cancers and viruses) and in vivo (against certain cancers only), WP1122 appears to improve the drug-like properties of 2-DG by creating a prodrug of 2-DG that reaches much higher tissue/organ concentrations than 2-DG alone. We believe WP1122 could be well suited as a treatment for highly glycolytic cancers such as GBM and pancreatic cancer.

In addition to the market for GBM described above, pancreatic cancer is a rare and difficult to treat form of cancer. Cancers of the pancreas are a very serious health issue in the United States where pancreatic cancer is the fifth leading cause of cancer deaths following breast cancer; lung cancer, colon cancer, and prostate cancer. Due to difficulties in diagnosis, the intrinsic aggressive nature of pancreatic cancers, and the sparse systemic treatment options available, only approximately 4% of patients diagnosed with pancreatic adenocarcinoma will be alive five years after diagnosis.

**Corporate History**

We were founded in 2015 by Walter Klemp (our chairman and CEO), Dr. Don Picker (our Chief Science Officer) and Dr. Waldemar Priebe of MD Anderson (Chairman of our Scientific Advisory Board) in order to combine and consolidate the development efforts involving several oncology technologies, based on license agreements with MD Anderson. Dr. Priebe is a Professor of Medicinal Chemistry in the Department of Experimental Therapeutics, Division of Cancer Medicine, at the University of Texas MD Anderson Cancer Center. This effort began with the acquisition of the Annamycin development project from AnnaMed, Inc. followed by the acquisition of the license rights to the WP1122 Portfolio from IntertechBio Corporation. Further, on behalf of Moleculin, LLC, we entered into a co-development agreement with Houston Pharmaceuticals, Inc., which culminated with the merger of Moleculin, LLC into MBI coincident with our initial public offering allowing us to gain control of the WP1066 Portfolio.

In June 2018, we formed Moleculin Australia Pty. Ltd., a wholly owned subsidiary to oversee pre-clinical development in Australia. The Australian government provides an aggressive incentive for research and development carried out in their country. We believe having an Australian subsidiary has provided a great opportunity for quality, pre-clinical and clinical development and reduce the overall cost of our continued drug development efforts. However, our efforts in Australia have substantially reduced as our focus on MIRACLE is centered on the US and Europe for now and we are weighing the cost benefit of continuing to support having such a subsidiary. The conclusion of such would be immaterial to the overall business.

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In July 2021, we formed Moleculin Amsterdam B.V., a wholly owned subsidiary, primarily to act as our legal representative for clinical trials in Europe for Moleculin Biotech, Inc.

On March 22, 2024, we completed a one-for-fifteen reverse stock split of our shares of common stock and on December 1, 2025 we completed a one-for-25 reverse stock split of our shares of common stock.

**Competition**

We operate in a highly competitive segment of the pharmaceutical market, which market is highly competitive as a whole. We face competition from numerous sources including commercial pharmaceutical and biotechnology enterprises, academic institutions, government agencies, and private and public research institutions. Many of our competitors may have significantly greater financial, product development, manufacturing and marketing resources. Additionally, many universities and private and public research institutes are active in cancer research, and some may be in direct competition with us. We may also compete with these organizations to recruit scientists and clinical development personnel. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

The unmet medical need for more effective cancer therapies is such that oncology drugs are one of the leading classes of drugs in development. These include a wide array of products against cancer targeting many of the same indications as our drug candidates. While the introduction of newer targeted agents may result in extended overall survival, we believe that induction therapy regimens are likely to remain a cornerstone of cancer treatment in the foreseeable future.

There are a number of established therapies that may be considered competitive for the cancer indications for which we intend to develop our lead product candidate, Annamycin. A key consideration when treating AML patients is whether the patient is suitable for intensive therapy. The standard of care for the treatment of newly diagnosed AML patients who can tolerate intensive therapy is cytarabine in combination with an anthracycline (e.g., doxorubicin or daunorubicin), typically referred to as a "7+3" regimen. For some patients, primarily those less than 60 years of age, a stem cell transplant could also be considered if the induction regimen is effective in attaining a CR (Complete Response). The 7+3 regimen of cytarabine in combination with an anthracycline has been the standard of care for decades. A patient not suitable for intensive therapy may be treated with Venclexta in combination with azacitidine, or low-intensity therapy such as low-dose cytarabine, azacitidine or decitabine. It should be noted that, in the United States, the latter are not approved by the FDA for the treatment of AML patients and there remains no effective therapy for these patients or for relapsed or refractory AML, with the exception of some recently approved targeted therapies that have demonstrated a low level of activity for limited subgroups of AML patients. The initial focus for Annamycin development is in patients for whom the standard induction regimen has failed. Also, several major pharmaceutical companies and biotechnology companies are aggressively pursuing new cancer development programs for the treatment of AML.

A number of attempts have been made or are under way to provide an improved treatment for AML. A recently developed liposome formulation of daunorubicin and cytarabine called Vyxeos provides a 5:1 ratio of cytarabine and daunorubicin in each of three injections. When compared with patients receiving 7 injections of cytarabine and 3 injections of daunorubicin (traditional 7+3 induction therapy), patients receiving Vyxeos achieved an average increase in overall survival of approximately 3.5 months (9.5 months compared with 6 months). Despite this extension of overall survival, Vyxeos did not reduce the toxic side effects of daunorubicin (including cardiotoxicity) and it failed to qualify a majority of patients for curative bone marrow transplant. More recently, Venetoclax was approved for the treatment of AML, targeting patients over 75 years of age or not suitable for typical chemotherapy.

Drugs attempting to target a subset of AML patients who present with specific gene mutations, such as IDH1, IDH2 and FLT3, have recently received FDA approval, but by definition serve only subsets of the AML population. Other targeted therapies are currently in clinical trials, as are other approaches that include immunotherapy relying on other biomarkers, other attempts at improved chemotherapy and alternative approaches to radiation therapy. Other approaches to improve the effectiveness of induction therapy are in early-stage clinical trials and, although they do not appear to address the underlying problems with anthracyclines, we can provide no assurance that such improvements, if achieved, would not adversely impact the need for improved anthracyclines. A modified version of doxorubicin designed to reduce cardiotoxicity is in clinical trials for the treatment of sarcoma and, although this drug does not appear to address multidrug resistance and is not currently intended for the treatment of acute leukemia, we can provide no assurance that it will not become a competitive alternative to Annamycin. Although we are not aware of any other single agent therapies in clinical trials that would directly compete against Annamycin in the treatment of relapsed and refractory AML, we can provide no assurance that such therapies are not in development, will not receive regulatory approval and will reach market before our drug candidate Annamycin. In addition, any such competing therapy may be more effective and/or cost-effective than ours.

Soft-tissue sarcomas which have metastasized to the lungs are extremely difficult to treat. The current standard of care consists of anthracycline therapy or newer-generation drugs such as pazopanib. However, only 20% of patients with STS lung metastases respond to these treatments. There are competitive efforts underway to develop new treatments for STS, including metastatic STS, but few specifically target STS metastases to the lungs.

Non-resectable pancreatic cancers are typically treated with chemotherapy and other pharmacotherapies, including Abraxane, Lynparza and Tarceva. While these products have been commercially successful, their success rates at treating pancreatic cancer are low and fatality rates remain high. This has led to a tremendous amount of clinical development activity in pancreatic cancer, with 551 trials ongoing, resulting in significant competition for pancreatic cancer patients among clinical trials, which could impact development timelines.

Competition for other indications targeted for each of our drug candidates is described above.

**Government Regulation**

Government authorities at the federal, state and local level in the US, and in analogous levels in other countries extensively regulate products such as those we are developing, including the conditions under which such products are approved for use, their safety and effectiveness, and how they are developed, tested, manufactured, packaged and labeled, promoted, stored and distributed. The pharmaceutical drug product candidates that we develop must be approved by the FDA before they may be marketed and commercially distributed in the US, and by regulators in other countries before being marketed and commercially distributed there.

In the United States, the FDA regulates pharmaceutical products such as our product candidates under the Federal Food, Drug, and Cosmetic Act (FDCA) and implementing regulations. Pharmaceutical products are also subject to other federal, state and local statutes and regulations. Obtaining regulatory approvals and complying with post-approval requirements generally is expensive, labor-intensive and time-consuming. Failure to comply with the applicable requirements may subject an applicant to administrative or judicial enforcement action, which could include refusal to permit clinical trials to be conducted, refusal to approve an application, placing a clinical trial on hold, withdrawal of an approval, issuance of a warning letter, product recall, product seizure, suspension of production or distribution, fines, refusals of government contracts, and restitution, disgorgement or civil or criminal penalties. Any agency or judicial enforcement action could have a material adverse effect on us.

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<u>Development and Approval</u>

The process required by the FDA before a pharmaceutical product may be marketed in the US generally involves the following:

• Completion of preclinical laboratory tests, animal studies and formulation studies;

• Submission to the FDA of an Investigational New Drug application, or IND, which must become effective before human clinical trials may begin;

• Performance of adequate and well-controlled human clinical trials according to the FDA's regulations commonly referred to as good clinical practices (GCP) and additional requirements for the protection of human research subjects and their health information, to establish the safety and effectiveness of the proposed product;

• Submission to the FDA of an NDA seeking marketing approval that includes substantial evidence of safety and effectiveness from results of clinical trials, as well as the results of preclinical testing, detailed information about the chemistry, manufacturing and controls, and proposed labeling and packaging for the product;

• Review of the product candidate by an FDA advisory committee, if applicable;

• Satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the pharmaceutical product is produced, to assess compliance with current good manufacturing practice, or cGMP, requirements, to assure that the facilities, methods and controls are adequate to preserve the pharmaceutical product's identity, strength, quality and purity;

• Potential FDA audit of the preclinical and clinical trial sites that generated the data in support of the NDA; and

• FDA review and approval of the NDA, including agreement on post-marketing commitments, if applicable.

The development and approval process, as well as post-approval requirements and restrictions, require substantial resources, attention and effort, and the prospects for approval and continued compliance are inherently uncertain.

*Preclinical Testing.* Before testing any compound in humans in the US, a company must generate extensive preclinical data. Preclinical testing generally includes laboratory evaluation of product chemistry and formulation, as well as toxicological and pharmacological studies in animals to assess the product's safety and activity. The preclinical work must be done in accordance with Good Laboratory Practice, or GLP, requirements, the Animal Welfare Act, and other applicable regulations. The sponsor must submit the preclinical data in an IND, together with manufacturing information, analytical data, any available clinical data or literature and a proposed clinical protocol. Unless the FDA notifies the sponsor otherwise, an IND becomes effective 30 days after receipt by the FDA, and the proposed clinical trial may begin. If it expresses concerns to the sponsor, FDA may impose a "clinical hold," which precludes beginning the study until the issues are resolved. Similarly, once a study has begun, the FDA may impose a clinical hold suspending further activity, pending resolution of agency concerns. Accordingly, we cannot be sure that submission of an IND will result in a clinical trial beginning or that, once begun, a clinical trial will not be suspended or terminated.

*IND Application.* Clinical trials involve the administration of the product candidate to healthy volunteers or subjects with the targeted disease under the supervision of qualified investigators, generally physicians not employed by or under the control of the clinical trial sponsor. Clinical trials are conducted under protocols detailing, among other things, the objectives of the clinical trial, dosing procedures, subject selection and exclusion criteria, how the results will be analyzed and presented and the parameters to be used to monitor subject safety. Each protocol for trials conducted in the US must be submitted to the FDA as part of the IND. Clinical trials must be conducted in accordance with FDA's good clinical practice, or GCP, regulations, which are intended to safeguard study subjects and support the validity of the resultant data. Further, each clinical trial must be reviewed and approved by an independent institutional review board (IRB) at, or servicing, each institution at which the clinical trial will be conducted. An IRB is charged with protecting the welfare and rights of study participants and for determining that the risks to study participants are minimized and are reasonable in relation to anticipated benefits. The IRB also approves the informed consent form that each study subject (or his or her legal representative) must sign, and is responsible for monitoring the conduct of the study until completed.

*Clinical testing.* Human clinical trials are typically conducted in three sequential phases that may overlap or be combined:

• Phase 1: The pharmaceutical product is initially administered to humans, usually a small group of healthy human subjects, but occasionally to subjects with the targeted disease. This latter case is usually reserved for product candidates intended for severe or life-threatening diseases (such as cancer) and/or when the product may be too inherently toxic to ethically administer to healthy volunteers. Phase 1 trials generally are intended to determine the metabolism and pharmacologic actions of the drug, the side effects associated with increasing doses, and, if possible, to gain early evidence of effectiveness. Because our product candidates are being studied for treating cancers and contain cytotoxic agents, our Phase 1 studies are conducted in late-stage cancer patients whose disease has progressed after treatment with other agents, and are focused on establishing a maximum tolerable dose (MTD).

• Phase 2: Here the product candidate is evaluated in a limited patient population to develop data regarding effectiveness, to determine dosage tolerance, optimal dosage and dosing schedule, to gather additional safety information, and to identify patient populations with specific characteristics where the pharmaceutical product may be more effective.

• Phase 3: Clinical trials are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population at geographically dispersed clinical trial sites. These clinical trials are intended to establish the overall risk/benefit ratio of the product and provide an adequate basis for product labeling. The studies must be well controlled and usually include a control arm for comparison. One or two Phase 3 studies are usually required by the FDA for an NDA approval, depending on the disease severity and other available treatment options. In some instances, an NDA approval may be obtained based on Phase 2 clinical data, often with the understanding that the approved drug can be sold subject to a confirmatory trial to be conducted post-approval.

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Additionally, post-approval studies, also referred to as Phase 4 clinical trials, may be conducted after initial marketing approval. These studies are often used to gain additional information about use of the product for its approved indication, and may at times be required by the FDA as a condition of approval.

Clinical trials require submission of annual progress reports to the FDA, and certain events, especially safety-related information, may require making reports to the FDA, investigators, and/or the IRB, and can lead to suspension, modification, or cessation of ongoing trials. Accordingly, clinical trials may not be completed successfully within any specified period, if at all.

Concurrent with clinical trials, companies usually complete additional animal studies, develop additional information about the physical characteristics of the product candidate and finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements.

The sponsor of a clinical trial or the sponsor's designated responsible party may be required to register certain information about the trial and disclose certain results on government or independent registry websites, such as ClinicalTrials.gov. Additionally, a manufacturer of an investigational drug for a serious disease or condition is required to make available, such as by posting on its website, its policy on evaluating and responding to requests for individual patient access to such investigational drug.

*NDA Submission and Review.* The results of product development, preclinical studies and clinical trials, along with descriptions of the manufacturing process, analytical tests conducted on the chemistry of the pharmaceutical product candidate, proposed labeling and other relevant information are submitted to the FDA as part of an NDA seeking approval to market the product. The submission of an NDA is subject to the payment of a substantial fee, although the fee may be waived under certain circumstances, which may or may not be applicable to us or our partners for any of our product candidates. In addition, an NDA or supplement to an NDA generally must contain data to assess the safety and effectiveness of the product candidate for the claimed indications in all relevant pediatric subpopulations and to support dosing and administration for each pediatric subpopulation for which the product is safe and effective. The FDA may grant deferrals for submission of data or full or partial waivers in certain circumstances.

The FDA first examines a submitted NDA to determine if the application is sufficiently complete to be accepted for review. If not, the agency may refuse to file the NDA, informing the sponsor of inadequacies to be addressed in a resubmitted application. The resubmitted application is also subject to an initial review before the FDA accepts it for filing. After accepting an NDA for filing, the FDA conducts an in-depth review of the application. Pursuant to goals established in statute, the FDA aims to complete the review within 12 months of the date of NDA submission, but that deadline is extended in certain circumstances, including by FDA requests for additional information or clarification.

The FDA also has programs intended to expedite the development and review of new drugs intended to treat serious or life-threatening conditions and address unmet medical needs and/or provide benefits over existing therapies. They include:

• Priority Review, under which the FDA aims to complete the NDA review within eight months of the submission;

• Accelerated Approval, where a product may be approved on the basis of data demonstrating an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality (IMM) that is reasonably likely to predict an effect on IMM or other clinical benefit;

• Fast Track, which may provide for FDA review of sections of the NDA on a rolling basis, before the complete application is submitted; and

• Breakthrough Therapy, which also provides for rolling review and other actions to expedite review of the NDA.

The availability of these programs is determined by the facts surrounding each specific product candidate, the disease or condition it is intended to treat, and the availability and characteristics of alternative treatments. Because those factors are subject to change, even if a product or application is granted designation for one (or more) of these programs, the benefits of the program may ultimately not be available. Additionally, the FDA may rescind designations for certain expedited programs (specifically, Fast Track and Breakthrough Therapy) if the agency determines the product candidate no longer meets the criteria for such programs.

The FDA review of an NDA focuses on determining, among other things, whether the proposed product candidate is safe and effective for its intended use, and whether the product candidate is being manufactured in accordance with cGMP to assure and preserve the product candidate's identity, strength, quality and purity. The FDA may refer certain applications to an advisory committee for a recommendation whether, and under what conditions, the application should be approved. The FDA carefully considers an advisory committee's recommendations, but is not bound by them. The FDA may also determine that a risk evaluation and mitigation strategy (REMS) is necessary to assure the safe use of the product. A REMS may include restrictions on the conditions under which the product is distributed, which may have a negative impact on the product's commercial success. If the FDA concludes that a REMS is needed, the NDA sponsor must submit a proposed REMS, and the product will not be approved until FDA determines that the proposed REMS is adequate.

The FDA usually inspects facilities at which the product candidate is manufactured, and will not approve the product candidate unless the agency determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications. Additionally, before approving an NDA, the FDA will typically inspect one or more clinical trial sites to assure compliance with IND study requirements and GCP. The NDA review process also includes evaluation of the proposed labeling, which is often the subject of significant back-and-forth between the sponsor and the agency.

The NDA review and approval process is lengthy and difficult, and may involve FDA requests for additional data or information, which may extend the process and/or lead the agency to refuse to approve the application. If it decides not to approve an NDA, the FDA will issue a complete response letter, which usually describes the specific deficiencies in the NDA and may include recommended actions the applicant might take for the FDA to reconsider the application. The deficiencies may be minor, for example, requiring labeling changes, or more significant, such as requiring additional clinical trials. An applicant receiving a complete response letter may either revise and resubmit the NDA or withdraw the application.

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FDA approval of an NDA may impose significant limitations that could weaken the commercial value of the product. This could take the form of a narrow indication or dosage, requiring the labeling to contain contraindications, warnings or precautions to address perceived safety issues, or mandating a REMS that significantly restricts or imposes burdens on how the product is distributed. Additionally, the FDA may require Phase 4 testing as a condition of approval. In particular, the FDA requires Phase 4 testing as a condition of accelerated approval, and may withdraw accelerated approval of a product if a sponsor fails to timely conduct such studies or if those studies fail to confirm safety or effectiveness. Such post-approval requirements can materially impact a product's commercial prospects. Post-approval modifications to a drug product, such as changes in indications, labeling or manufacturing processes or facilities, may require development and submission of additional information or data in a new or supplemental NDA, which would also require prior FDA approval.

*Regulatory Exclusivities.* The Orphan Drug Act provides incentives for the development of drugs intended to treat rare diseases or conditions, which generally are diseases or conditions affecting less than 200,000 individuals in the US. If a sponsor demonstrates that a drug is intended to treat a rare disease or condition, the FDA grants ODD for the product for that use. The benefits of ODD include research and development tax credits and exemption from user fees, including the significant application fee otherwise required with submission of an NDA. A drug that is approved for an indication that is within the product's orphan drug designation is granted seven years of orphan drug exclusivity (ODE). During that period, the FDA generally may not approve any other application for product with the same active moiety for the same use, although there are exceptions, most notably when the later product is shown to be clinically superior to the product with orphan drug exclusivity.

ODD and ODE are also available from the European Union (EU). ODD in the EU is generally available for drug products intended to treat life-threatening or chronically debilitating conditions affecting not more than five in 10,000 persons in the EU when the application is made. If the orphan-designated product continues to meet the criteria for orphan designation at approval, the approval for an orphan-designated indication conveys a 10-year exclusivity period, during which the competent authorities in the EU may not accept another marketing authorization application and may not grant another marketing authorization for a similar medicinal product (i.e., a medicinal product with an identical active substance, or an active substance with the same principal molecular structural features and that acts via the same mechanisms) for the same therapeutic indication. The 10-year period can be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria for the ODD, which can include if the product is sufficiently profitable not to justify market exclusivity. In the EU, ODE does not preclude granting a marketing authorization for a similar medicinal product for the same therapeutic indication, if that medicinal product is demonstrated to be safer, more effective or otherwise clinically superior, or if the company with orphan drug exclusivity is unable to supply sufficient quantities of the product. Significant revisions to the relevant law in the EU have been proposed and, if adopted, may affect the availability or benefits of ODD or ODE there. Such revisions are expected to be finalized in 2026, likely entering into force in 2028.

Products that are approved to treat rare diseases that are serious or life-threatening and where the serious or life-threatening manifestations primarily affect patients under 19 years of age may qualify for the Rare Pediatric Disease Priority Review Voucher (RPDPRV) program, in which the product sponsor receives upon approval a voucher for priority review of another product. The voucher can be used by the sponsor for a subsequent application that would not in its own right qualify for priority review, or it may be sold to another company for that use. In either case, a RPDPRV may have significant value. In February 2026, the statute was amended to continue the RPDPRV program through September 2029.

We received ODD for Annamycin for the treatment of AML in 2018, and in 2020 for the treatment of soft tissue sarcomas, and Fast Track Designation for Annamycin for the treatment of relapsed or refractory AML in April 2019. We received ODD for WP1066 for the treatment of glioblastoma in 2019. If WP1066 is timely approved for the treatment of any of the following pediatric diseases, we may qualify for a Rare Pediatric Disease Priority Review Voucher: ependymoma, medulloblastoma, diffuse intrinsic pontine glioma, or atypical teratoid rhabdoid tumor, provided that related statutory sunset provisions are extended.

<u>Hatch-Waxman Act</u>

The Drug Price Competition and Patent Term Restoration Act of 1984 (the Hatch-Waxman Act) amended the FDCA to establish two abbreviated approval pathways for pharmaceutical products that are in some way follow-on versions of already approved products.

*Generic Drugs.*&nbsp;&nbsp;&nbsp;&nbsp;A generic version of an approved drug is approved by means of an abbreviated new drug application (ANDA), by which the sponsor demonstrates that the proposed product is the same as the approved, brand-name drug, which is referred to as the reference listed drug (RLD). Generally, an ANDA must contain data and information showing that the proposed generic product and RLD (i) have the same active ingredient, in the same strength and dosage form, to be delivered via the same route of administration, (ii) are intended for the same uses, and (iii) are bioequivalent. This is instead of independently demonstrating the proposed product's safety and effectiveness, which are inferred from the fact that the product is the same as the RLD, which the FDA previously found to be safe and effective.

*505(b)(2) NDAs.*&nbsp;&nbsp;&nbsp;&nbsp;As discussed above, if a product is similar, but not identical, to an already approved product, it may be submitted for approval via an NDA under section 505(b)(2) of the FDCA. Unlike an ANDA, this does not excuse the sponsor from demonstrating the proposed product's safety and effectiveness. Rather, the sponsor is permitted to rely to some degree on information from investigations that were not conducted by or for the applicant and for which the applicant has not obtained a right of reference, and must submit its own product-specific data of safety and effectiveness to an extent necessary because of the differences between the products. An NDA approved under 505(b)(2) may in turn serve as an RLD for subsequent applications from other sponsors.

*RLD Patents.*&nbsp;&nbsp;&nbsp;&nbsp;In an NDA, a sponsor must identify patents that claim the drug substance or drug product or a method of using the drug. When the drug is approved, those patents are among the information about the product that is listed in the FDA publication, *Approved Drug Products with Therapeutic Equivalence Evaluations*, which is referred to as the *Orange Book*. The sponsor of an ANDA or 505(b)(2) application seeking to rely on an approved product as the RLD must make one of several certifications regarding each listed patent. A "Paragraph I" certification is the sponsor's statement that patent information has not been filed for the RLD. A "Paragraph II" certification is the sponsor's statement that the RLD's patents have expired. A "Paragraph III" certification is the sponsor's statement that it will wait for the patent to expire before obtaining approval for its product. A "Paragraph IV" certification is an assertion that the patent does not block approval of the later product, either because the patent is invalid or unenforceable or because the patent, even if valid, is not infringed by the new product.

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Once the FDA accepts for filing an ANDA or 505(b)(2) application containing a Paragraph IV certification, the applicant must within 20 days provide notice to the RLD or listed drug NDA holder and patent owner that the application has been submitted, and provide the factual and legal basis for the applicant's assertion that the patent is invalid or not infringed. If the NDA holder or patent owner files suit against the ANDA or 505(b)(2) applicant for patent infringement within 45 days of receiving the Paragraph IV notice, the FDA is prohibited from approving the ANDA or 505(b)(2) application for a period of 30 months or the resolution of the underlying suit, whichever is earlier. If the RLD has NCE exclusivity and the notice is given and suit filed during the fifth year of exclusivity, the regulatory stay extends until 7.5 years after the RLD approval. The FDA may approve the proposed product before the expiration of the regulatory stay if a court finds the patent invalid or not infringed or if the court shortens the period because the parties have failed to cooperate in expediting the litigation.

*Regulatory Exclusivities.*&nbsp;&nbsp;&nbsp;&nbsp;The Hatch-Waxman Act provides periods of regulatory exclusivity for products that would serve as RLDs for an ANDA or 505(b)(2) application. If a product is a "new chemical entity," or NCE — generally meaning that the active moiety has never before been approved in any drug — there is a period of five years from the product's approval during which the FDA may not accept for filing any ANDA or 505(b)(2) application for a drug with the same active moiety. There are circumstances under which the follow-on application can be submitted at four years, and there are provisions that operate to preclude approval of the application for an additional period of time. Also, NCE exclusivity does not block approval of a "full" NDA (generally, an NDA in which the data are the sponsor's or for which the sponsor has obtained a right of reference). The NCE exclusivity scheme is complicated and evolving; for that reason, although we believe that some of our products will qualify for five-year NCE exclusivity, we cannot be certain we will receive such exclusivity, or that if we do, the exclusivity will effectively protect our market position.

A product that is not an NCE may qualify for a three-year period of exclusivity if the NDA contains new clinical data, (other than bioavailability studies) derived from studies conducted by or for the sponsor, that were necessary for approval. In that instance, the exclusivity period does not preclude filing or review of an ANDA or 505(b)(2) application; rather, the FDA is precluded from granting final approval to the ANDA or 505(b)(2) application until three years after approval of the RLD. Additionally, the exclusivity applies only to the conditions of approval that required submission of the clinical data.

*Patent Term Restoration.*&nbsp;&nbsp;&nbsp;&nbsp;A portion of the patent term lost during product development and FDA review of an NDA is restored if approval of the application is the first permitted commercial marketing of a drug containing the active ingredient. The patent term restoration period is generally one-half the time between the effective date of the IND or the date of patent grant (whichever is later) and the date of submission of the NDA, plus the time between the date of submission of the NDA and the date of FDA approval of the product. The maximum period of restoration is five years, and the patent cannot be extended to more than 14 years from the date of FDA approval of the product. Only one patent claiming each approved product is eligible for restoration and the patent holder must apply for restoration within 60 days of approval. In consultation with the FDA, the U.S. Patent and Trademark Office (USPTO) reviews and approves the application for patent term restoration.

In the future, we may be able to apply for extension of patent term for one or more of our currently licensed patents or any future owned patents to add patent life beyond its current expiration date, depending upon the expected length of the clinical trials and other factors involved in the filing of the relevant NDA. We cannot be certain that any of our product candidates will qualify for patent term restoration or, if so, for how long the patent term will be extended.

<u>Post-Approval Requirements</u>

Once approved, products are subject to continuing regulation by the FDA, including, among other things, cGMP compliance, record-keeping requirements, reporting of adverse experiences with the product, providing the FDA with updated safety and efficacy information, product sampling and distribution requirements, complying with certain electronic records and signature requirements and complying with FDA promotion and advertising requirements, which include standards for direct-to-consumer advertising, prohibitions on promoting pharmaceutical products for uses or in patient populations that are not described in the pharmaceutical product's approved labeling (known as "off-label use"), industry-sponsored scientific and educational activities and promotional activities involving the internet. Although physicians may prescribe legally available pharmaceutical products for off-label uses, manufacturers may not directly or indirectly market or promote such off-label uses. If ongoing regulatory requirements are not met, or if safety or manufacturing problems occur after the product reaches the market, the FDA may at any time withdraw product approval or take actions that would limit or suspend marketing. Additionally, the FDA may require post-marketing studies or clinical trials, changes to a product's approved labeling, including the addition of new warnings and contraindications, or the implementation of other risk management measures, including distribution-related restrictions, if there are new safety information developments. Further, failure to comply with FDA requirements can have negative consequences including adverse publicity, enforcement letters from the FDA, actions by the US Department of Justice and/or US Department of Health and Human Services Office of Inspector General, mandated corrective advertising or communications with doctors, and civil or criminal penalties.

We rely and expect to continue to rely on third parties for the production of clinical and commercial quantities of our product candidates. Manufacturers of our product candidates are required to comply with applicable FDA manufacturing requirements contained in the agency's cGMP regulations and related policies. The cGMP regulations require, among other things, adhering to requirements relating to organization and training of personnel, buildings and facilities, equipment, control of components and drug product containers and closures, production and process controls, packaging and labeling controls, holding and distribution, laboratory controls, quality control and quality assurance, as well as the corresponding maintenance of records and documentation. Pharmaceutical product manufacturers and other entities involved in the manufacture and distribution of pharmaceutical products are required to register their establishments with the FDA and certain state agencies and the FDA inspects equipment, facilities, and processes used in manufacturing pharmaceutical products prior to approval. The FDA and certain state agencies also conduct periodic inspections to re-inspect equipment, facilities, and processes for compliance with cGMP and other laws. Accordingly, manufacturers must continue to expend time, money and effort in the area of production and quality control to maintain cGMP compliance. Failure to comply with applicable cGMP requirements and conditions of product approval may lead the FDA to take enforcement actions or seek sanctions, including fines, issuance of warning letters, civil penalties, injunctions, suspension of manufacturing operations, operating restrictions, withdrawal of FDA approval, seizure or recall of products, and criminal prosecution. Although we periodically monitor the FDA compliance of our third-party manufacturers, we cannot be certain that our present or future third-party manufacturers will consistently comply with cGMP and other applicable FDA regulatory requirements.

Discovery of problems with a product after approval may result in restrictions on a product, manufacturer or NDA sponsor, including withdrawal of the product from the market. In addition, changes to the manufacturing process generally require prior FDA approval before being implemented and other types of changes to the approved product, such as adding new indications and additional labeling claims, are also subject to further FDA review and approval.

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<u>Pharmaceutical Coverage, Pricing and Reimbursement</u>

Significant uncertainty exists as to the coverage and reimbursement status of any pharmaceutical product candidates for which we may obtain regulatory approval. In the United States and in markets in other countries, sales of any products for which we receive regulatory approval for commercial sale will depend in part upon the availability of reimbursement from third-party payers. Third-party payers include government payers such as Medicare and Medicaid, managed care providers, private health insurers and other organizations. The process for determining whether a payer will provide coverage for a pharmaceutical product may be separate from the process for setting the price or reimbursement rate that the payer will pay for the pharmaceutical product. Third-party payers may limit coverage to specific pharmaceutical products on an approved list, or formulary, which might not, and frequently do not, include all the FDA-approved pharmaceutical products for a particular indication. Third-party payers are increasingly challenging the price and examining the medical necessity and cost-effectiveness of medical products and services, in addition to their safety and efficacy. Further, payers are increasingly using "outcome-based" or "performance-based" agreements, where reimbursement is provided only for patients who respond to the therapy. A payer's decision to provide coverage for a pharmaceutical product does not imply that an adequate reimbursement rate will be approved. Adequate third-party reimbursement may not be available to enable us to maintain price levels sufficient to realize an appropriate return on our investment in product development. In addition, in the United States there is a growing emphasis on comparative effectiveness research, both by private payers and by government agencies. We may need to conduct expensive pharmaco-economic studies in order to demonstrate the medical necessity and cost-effectiveness of our products, in addition to the costs required to obtain the FDA approvals. Our pharmaceutical product candidates may not be considered medically necessary or cost-effective. To the extent other drugs or therapies are found to be more effective than our products, payers may elect to cover such therapies in lieu of our products and/or reimburse our products at a lower rate.

Different pricing and reimbursement schemes exist in other countries. In the European Community, governments influence the price of pharmaceutical products through their pricing and reimbursement rules and control of national healthcare systems that fund a large part of the cost of those products to consumers. Some jurisdictions operate positive and negative list systems under which products may only be marketed once a reimbursement price has been agreed upon. To obtain reimbursement or pricing approval, some of these countries may require the completion of clinical trials that compare the cost-effectiveness of a particular pharmaceutical product candidate to currently available therapies. Other member states allow companies to fix their own prices for medicines but monitor and control company profits. The downward pressure on healthcare costs in general, particularly prescription drugs, has become very intense. As a result, increasingly high barriers are being erected to the entry of new products. In addition, in some countries, cross-border imports from low-priced markets exert a commercial pressure on pricing within a country.

The marketability of any pharmaceutical product candidates for which we may receive regulatory approval for commercial sale may suffer if the government and third-party payers fail to provide adequate coverage and reimbursement. In addition, emphasis on managed care in the United States has increased and we expect this will continue to increase the pressure on pharmaceutical pricing. Coverage policies and third-party reimbursement rates may change at any time. Payers are also using management tactics and benefit designs that focus on the use of orphan drugs and can result in providers and patients facing hurdles than affect utilization. Even if favorable coverage and reimbursement status is attained for one or more products for which we may receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future.

The ACA substantially changed the way healthcare is financed by both governmental and private insurers and significantly impacts the pharmaceutical industry. The ACA is intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against healthcare fraud and abuse, add new transparency requirements for healthcare and health insurance industries, impose new taxes and fees on pharmaceutical manufacturers and impose additional health policy reforms. Further, the Inflation Reduction Act (IRA), among other things, (1) directs HHS to negotiate the price of certain high-cost, single-source drugs and biologics covered under Medicare and (2) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation. Under the IRA, certain categories of drugs are excluded from price negotiations, including drugs that receive orphan drug designation as the only FDA-approved indication. The One Big Beautiful Bill Act (OBBBA), signed on July 4, 2025, updated the IRA exemptions for orphan drugs by providing that orphan drugs are exempt from Medicare price negotiations even if they are approved for multiple rare diseases. Further, OBBBA establishes that the 7-year timeline that triggers Medicare price negotiations now only begins on the first day after a drug is approved for a non-orphan indication. While we have obtained orphan drug designation for Annamycin, if we seek additional indications, or fail to maintain our orphan drug status, we may become subject to the price negotiation process. Further, the Trump administration has introduced aggressive pricing initiatives through executive order and otherwise that create new revenue risks, including Most-Favored-Nation (MFN) Pricing that would compel manufacturers to align U.S. prices with the lowest paid in "economic peer countries" (*e.g.,* UK, France, Germany, Japan). This could reduce the ultimate price that we receive for Annamycin, which could negatively affect our business, results of operations, financial conditions, and prospects. We expect that changes or additions to the ACA, IRA OBBBA, MFN pricing or their implementing regulations or guidance, changes to the Medicare and Medicaid programs, changes regarding the federal government's authority to directly negotiate drug prices and changes stemming from other healthcare reform measures, especially with regard to healthcare access or financing or other legislation in individual states, could have a material adverse effect on the healthcare industry and our business.

At the state level, individual states in the United States have also increasingly passed legislation and implemented regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. Additionally, some individual states have begun establishing Prescription Drug Affordability Boards to review high-cost drugs and, in some cases, set upper payment limits. Legally mandated price controls on payment amounts by third-party payors or other restrictions could harm our business, results of operations, financial condition, and prospects. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs.

<u>International Regulation</u>

In addition to regulations in the United States, we are subject to a variety of foreign regulations governing clinical trials and commercial sales and distribution of our future drugs. Whether or not we obtain FDA approval for a drug, we must obtain approval of a drug by the comparable regulatory authorities of foreign countries before we can commence clinical trials or marketing of the drug in those countries. The approval process varies from country to country, and the time may be longer or shorter than that required for FDA approval. The requirements governing the conduct of clinical trials, product licensing, pricing and reimbursement vary greatly from country to country.

Under European Union regulatory systems, marketing authorizations may be submitted either under a centralized or mutual recognition procedure. The centralized procedure provides for the grant of a single marketing authorization that is valid for all European Union member states. The mutual recognition procedure provides for mutual recognition of national approval decisions. Under this procedure, the holder of a national marketing authorization may submit an application to the remaining member states. Within 90 days of receiving the applications and assessment report, each member state must decide whether to recognize approval.

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In addition to regulations in Europe and the United States, we will be subject to a variety of foreign regulations governing clinical trials and commercial distribution of our future drugs.

**Access to Information**

Our website is at www.moleculin.com. We make available, free of charge, on our corporate website, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as soon as reasonably practicable after they are electronically filed with the SEC. The SEC maintains an internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC at www.sec.gov. Information contained on our website does not, and shall not be deemed to, constitute part of this Annual Report on Form 10-K. Our reference to the URL for our website is intended to be an inactive textual reference only.

**ITEM 1A. RISK FACTORS** 

 

**Summary of Risk Factors:** 

Below is a summary of the principal factors that make an investment in our company speculative or risky. This summary does not address all of the risks that we face. Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below, after this summary, and should be carefully considered, together with other information in this Annual Report on Form 10-K and our other filings with the SEC before making an investment decision in our securities.

**Risks Related to Regulatory Approval and the Development and Commercialization of our Drug Candidates**

• We are developing our drug candidates to treat patients who are extremely or terminally ill, and patient deaths that occur in our clinical trials could negatively impact our business even if such outcomes are not shown to be related to our drug candidates.

• We are conducting important clinical trials in the US and Europe, and assessing additional countries in which to perform preclinical studies and clinical trials and the risks associated with conducting research and clinical trials abroad could materially adversely affect our business.

• There are limited suppliers for active pharmaceutical ingredients (API) used in our drug candidates and we utilize a single source for such API for certain of our drug candidates. Problems with the third parties that manufacture the API used in our drug candidates may delay our clinical trials or subject us to liability.

• We cannot guarantee how long it will take regulatory agencies to review our applications for product candidates, and we may fail to obtain the necessary regulatory approvals to market our product candidates. If we are not able to obtain required regulatory approvals, we will not be able to commercialize our product candidates and our ability to generate revenue will be materially impaired.

• Delays in the commencement, enrollment and completion of clinical trials could result in increased costs to us and delay or limit our ability to obtain regulatory approval for any of our product candidates.

• As an organization, we have never before conducted pivotal clinical trials, and we may be unable to do so for any product candidate we may develop.

• We may expend significant resources to pursue certain product candidates for specific indications and fail to capitalize on the potential of such product candidates for the potential treatment of other indications that may be more profitable or for which there is a greater likelihood of success.

• We have commenced clinical trials and have never submitted an NDA, and any product candidate we advance through clinical trials may not have favorable results in later clinical trials or receive regulatory approval.

• We may find it difficult to enroll subjects in our clinical trials, which could delay or prevent clinical trials of our product candidates.

• A portion of our clinical development plan relies on physician-sponsored trials, which we do not control, and which may encounter delays for reasons outside of our control.

• If any of our drug product candidates are found to be unsafe or lack sufficient efficacy, we will not be able to obtain regulatory approval for it and our business would be harmed.

• Our product candidates may have undesirable side effects that may delay or prevent marketing approval, or, if approval is received, require them to be taken off the market, require them to include safety warnings or otherwise limit their sales.

• Even if our product candidates otherwise qualify for approval from the FDA, if the FDA does not find the manufacturing facilities of our future contract manufacturers acceptable for commercial production, we may not be able to commercialize any of our product candidates.

• We received ODD for Annamycin, WP1066, and WP1122, but even if either product candidate is approved and receives ODE, ODE may not effectively prevent approval of a competing product.

• We may not be able to obtain or maintain rare pediatric disease designation or exclusivity for our product candidates, which could limit the potential profitability of our product candidates.

• The regulatory approval processes of the FDA and comparable foreign authorities are lengthy, time consuming and inherently unpredictable, and even if we obtain approval for a product candidate in one country or jurisdiction, we may never obtain approval for or commercialize it in any other jurisdiction, which would limit our ability to realize our full market potential.

• We have received Fast Track designation for two of our product candidates and may seek the same designation for one of more of our other product candidates. Even if we receive designation, such designation may not actually lead to a faster development or regulatory review or approval process. Fast Track designation may also be rescinded if the FDA believes the designation is no longer supported by data from our clinical development program.

• Interim or preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data. 

• We may not be able to conduct, or contract others to conduct, animal testing in the future, which could harm our research and development activities.

• We, or our third-party manufacturers, may be unable to successfully scale-up manufacturing of our product candidates in sufficient quality and quantity, which would delay or prevent us from developing our product candidates and commercializing approved products, if any.

• Even if we obtain regulatory approvals for our product candidates, they will remain subject to ongoing regulatory oversight.

• Recently enacted legislation, future legislation and healthcare reform measures may increase the difficulty and cost for us to obtain marketing approval for and commercialize Annamycin and any future product candidates and may affect the prices we may set.

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**Risks Related to Our Intellectual Property**

• We rely on patents and other intellectual property rights to protect our product candidates, the attainment, enforcement, defense and maintenance of which may be challenging and costly and failure to do so could impair our business.

• We enjoy only limited geographical protection with respect to certain patents and may not be able to protect our intellectual property rights throughout the world.

• The intellectual property rights we have licensed from MD Anderson are subject to the rights of the US government.

• Our patents and other proprietary rights may not adequately protect our technologies and product candidates and may not necessarily address all potential threats to our competitive advantage.

• We may become subject to third parties' claims alleging infringement of third-party patents and proprietary rights, or we may be involved in lawsuits to protect or enforce our patents and other proprietary rights, which could be costly and time consuming, delay or prevent the development and commercialization of our product candidates, or put our patents and other proprietary rights at risk.

• We may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of a third-party patent which might adversely affect our ability to develop, manufacture and market our product candidates.

• If we breach any of the agreements under which we license patent rights or if we fail to meet certain development deadlines, pay certain fees including extension fees or exercise certain rights to technology, we could lose or fail to obtain license rights that are important to our business.

• We may not be successful in maintaining necessary rights to our product candidates or obtaining patent or other intellectual property rights important to our business through acquisitions and in-licenses.

• Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment, and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.

• We may be subject to claims challenging the inventorship of our patents and other intellectual property.

• Changes in patent laws or patent jurisprudence could diminish the value of patents in general, thereby impairing our ability to protect our product candidates.

• If we do not obtain protection under the Hatch-Waxman Amendments and similar non-U.S. legislation for extending the term of patents covering our product candidates, our ability to compete effectively could be impaired.

• If our trademarks and trade names are not adequately protected, we may not be able to build name recognition in our markets of interest and our competitive position may be adversely affected.

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

• We may be subject to claims by third parties asserting that we or our employees have misappropriated third-party intellectual property, or claiming ownership of what we regard as our own intellectual property. These claims may be costly to defend and if we do not successfully do so, we may be required to pay monetary damages and lose valuable intellectual property rights or personnel.

• Our business and operations may suffer, and proprietary information may be lost, in the event of information technology system failures, cyberattacks or deficiencies in our cybersecurity.

**Risks Relating to Our Business and Financial Condition**

• We will require additional funding, which may not be available to us on acceptable terms, or at all, and, if not so available, may require us to delay, limit, reduce or cease our operations.

• Because successful development of our product candidates is uncertain, we are unable to estimate the actual amount of funding we will require to complete research and development and commercialize our products under development.

• We have commenced clinical trials, have a limited operating history and we expect a number of factors to cause our operating results to fluctuate on an annual basis, which may make it difficult to predict our future performance.

• We have in the past completed related party transactions that were not conducted on an arm's length basis.

• We have never been profitable, we have no products approved for commercial sale, and to date we have not generated any revenue from product sales. As a result, our ability to reduce our losses and reach profitability is unproven, and we may never achieve or sustain profitability.

• Our financial condition would be adversely impacted if our intangible assets become impaired.

• We have no sales, marketing or distribution experience and we will have to invest significant resources to develop those capabilities or enter into acceptable third-party sales and marketing arrangements.

• We may not be successful in establishing and maintaining development and commercialization collaborations, which could adversely affect our ability to develop certain of our product candidates and our financial condition and operating results.

• We face competition from other biotechnology and pharmaceutical companies and our operating results will suffer if we fail to compete effectively.

• We will need to expand our operations and increase the size of our company, and we may experience difficulties in managing growth.

• We may not be able to manage our business effectively if we are unable to attract and retain key personnel and consultants.

• We do not expect that our insurance policies will cover all of our business exposures thus leaving us exposed to significant uninsured liabilities.

• We may incur penalties if we fail to comply with healthcare regulations.

• We may not be able to recover from any catastrophic event affecting our suppliers.

• Our business and operations would suffer in the event of third-party computer system failures, cyber-attacks on third-party systems or deficiency in our cyber security.

• Our failure to comply with data protection laws and regulations could lead to government enforcement actions and significant penalties against us, and adversely impact our operating results.

• We depend on our information technology and infrastructure so compromises could materially harm our ability to conduct business or delay our financial reporting.

• We may be required to make significant payments under our license agreements with MD Anderson.

• New tax laws or regulations that are enacted or existing tax laws and regulations that are interpreted, modified, or applied adversely to us or our customers may have a material adverse effect on our business and financial condition.

• We must comply with indirect tax laws in multiple jurisdictions, as well as complex customs duty regimes worldwide. Audits of our compliance with these rules may result in additional liabilities for taxes, duties, interest and penalties related to our international operations which would reduce our profitability.

• Errors in our assumptions, estimates and judgments related to tax matters, including those resulting from regulatory reviews, could adversely affect our financial results.

• We will require significant additional funding to complete the MIRACLE trial, which may not be available to us on acceptable terms, or at all, and, if not so available, may require us to delay, limit, reduce or cease our operations.

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**Risks Relating to Our Common Stock**

• Our stock price has been and may continue to be volatile, which could result in substantial losses for investors.

• Shares issuable upon the exercise of outstanding options or warrants may substantially increase the number of shares available for sale in the public market and depress the price of our common stock.

• As a biotechnology company, we are at increased risk of securities class action litigation.

• If we are unable to maintain compliance with the listing requirements of The Nasdaq Capital Market, our common stock may be delisted from The Nasdaq Capital Market which could have a material adverse effect on our financial condition and could make it more difficult for you to sell your shares.

• Failure to maintain our accounting systems and controls could impair our ability to comply with the financial reporting and internal controls requirements for publicly traded companies.

• Unstable market and economic conditions may have serious adverse consequences on our business, financial condition and stock price.

• We cannot predict the effect that our reverse stock split will have on the market price for shares of our common stock.

• There are provisions in certain of our outstanding warrants that could discourage an acquisition of us by a third party.

• If our estimates or judgments relating to our critical accounting policies prove to be incorrect, or if financial reporting standards or interpretations change, our results of operations could be adversely affected.

*The following risks and uncertainties should be carefully considered. If any of the following occurs, our business, financial condition or operating results could be materially harmed. An investment in our securities is speculative in nature, involves a high degree of risk and should not be made by an investor who cannot bear the economic risk of its investment for an indefinite period of time and who cannot afford the loss of its entire investment.*

**Risks Related to Regulatory Approval and the Development and Commercialization of our Drug Candidates**

***We are developing our drug candidates to treat patients who are extremely or terminally ill, and severe adverse outcomes, including patient deaths, that occur in our clinical trials could negatively impact our business even if such outcomes are not shown to be related to our drugs.***

It is our intention to continue to develop our drug candidates focused on rare and deadly forms of cancer. Patients suffering from these diseases are extremely sick and have a high likelihood of experiencing adverse outcomes, including death, as a result of their disease or due to other significant risks including relapse of their underlying malignancies. Many patients have already received high-dose chemotherapy and/or radiation therapy, which are associated with their own inherent risks, prior to treatment with our drug candidates.

As a result, it is likely that we will observe severe adverse outcomes during our clinical trials for our drug candidates, including patient death. If a significant number of study subject deaths were to occur, regardless of whether such deaths are attributable to one of our drugs, our ability to obtain regulatory approval and/or achieve commercial acceptance for the related drug may be adversely impacted and our business could be materially harmed.

***We*** ***are conducting important clinical trials in the US and Europe, and additional countries in which to perform preclinical studies and clinical trials, and the risks associated with conducting research and clinical trials abroad could materially adversely affect our business.***

We have approved INDs, Clinical Trial Authorizations or their equivalent in the US, Ukraine, Georgia, Spain, Romania, Czechia, Lithuania, Poland and Italy. Additionally, from time to time, we perform studies to determine if there are additional countries in which we should hold current and future clinical and preclinical studies. Accordingly, we expect that we will be subject to additional risks related to operating in foreign countries, including:

• differing regulatory requirements in foreign countries;

• unexpected changes in price and exchange controls and other regulatory requirements;

• increased difficulties in managing the logistics and transportation of collecting and shipping patient material;

• import and export requirements and restrictions;

• compliance with tax, employment, immigration and labor laws for employees living or traveling abroad;

• foreign taxes, including withholding of payroll taxes;

• foreign currency fluctuations, which could result in increased operating expenses, and other obligations incident to doing business in another country;

• difficulties staffing and managing foreign operations;

• potential liability under the Foreign Corrupt Practices Act of 1977 or comparable foreign regulations;

• challenges enforcing our contractual and intellectual property rights, especially in those foreign countries that do not respect and protect intellectual property rights to the same extent as the United States;

• production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and

• business interruptions resulting from geo-political actions, including war and terrorism.

These and other risks associated with our international operations may materially adversely affect our ability to attain or maintain profitable operations.

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***There are limited suppliers for active pharmaceutical ingredients (API) used in our drug candidates and/or in manufacturing the final drug product. We utilize a single source for such API and/or final drug product for certain of our drug candidates.***

We do not currently own or operate manufacturing facilities for clinical or commercial production of the API used in any of our product candidates. We have no experience in API manufacturing, and we lack the resources and the capability to manufacture any of the APIs used in our product candidates, on either a clinical or commercial scale. As a result, we rely on third parties to supply the API used in each of our product candidates. For our lead product candidate, Annamycin, we currently utilize a single source to manufacture API and a single source for drug product. If we were to lose either of these suppliers, it could cause delays while we located a new supplier. We expect to continue to depend on third parties to supply the API for our current and future product candidates and to supply the API in commercial quantities in a timely manner.

Reliance on third-party manufacturers entails risks to which we would not be subject if we manufactured the product candidates ourselves, including:

• the inability to negotiate manufacturing agreements with third parties under commercially reasonable terms;

• reduced control as a result of using third-party manufacturers for all aspects of manufacturing activities, including regulatory compliance and quality assurance. We do not have control over third party manufacturers' compliance with these regulations and standards, but we may ultimately be responsible for any of their failures;

• delays as a result of manufacturing problems or re-prioritization of projects at a third-party manufacturer;

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

• termination or non-renewal of manufacturing agreements with third parties in a manner or at a time that is costly or damaging to us;

• the possible misappropriation of our proprietary information, including our trade secrets and know-how or infringement of third-party intellectual property rights by our contract manufacturers; and

• disruptions to the operations of our third-party manufacturers or suppliers caused by conditions unrelated to our business or operations, including the bankruptcy of the manufacturer or supplier.

Any of these events could lead to preclinical study and clinical trial delays or failure to obtain regulatory approval or affect our ability to successfully commercialize future products. Some of these events could be the basis for FDA or other regulatory authority action, including clinical holds, fines, injunctions, civil penalties, license revocations, recall, seizure, total or partial suspension of production, or criminal penalties.

In addition, our product candidates involve technically complex manufacturing processes, and even slight deviations at any point in the production process may lead to production failures and may cause the production of our product candidates to be disrupted, potentially for extended periods of time. In some cases, the technical skills required to manufacture our products or product candidates may be unique or proprietary to the original contract manufacturer and we may have difficulty, or there may be contractual restrictions prohibiting us from, transferring such skills to a back-up or alternate supplier, or we may be unable to transfer such skills at all. Furthermore, a contract manufacturer may possess technology related to the manufacture of our product candidate that such contract manufacturer owns independently. This would increase our reliance on such contract manufacturer or require us to obtain a license from such contract manufacturer in order to have another contract manufacturer manufacture our product candidates.

Third-party manufacturers may not be able to comply with applicable cGMP regulations or similar regulatory requirements outside the US. Our failure, or the failure of our third-party manufacturers, to comply with applicable regulations could result in sanctions being imposed, including clinical holds, fines, injunctions, civil penalties, delays, license revocation, seizures or recalls of product candidates or products, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect supplies of our product candidates.

In addition, if we are required to change contract manufacturers for any reason, we will be required to verify that the new contract manufacturer maintains facilities and procedures that comply with quality standards and with all applicable regulations. We will also need to verify, such as through a manufacturing comparability study, that any new manufacturing process will produce our product candidate according to the specifications previously submitted to the FDA or another regulatory authority. The delays associated with the verification of a new contract manufacturer could negatively affect our ability to develop product candidates or commercialize our products in a timely manner or within budget. In addition, changes in manufacturers often involve changes in manufacturing procedures and processes, which could require that we conduct bridging studies between our prior clinical supply used in our clinical trials and that of any new manufacturer. We may be unsuccessful in demonstrating the comparability of clinical supplies which could require the conduct of additional clinical trials.

Our product candidates and any products that we may develop may compete with other product candidates and products for access to manufacturing facilities. There are a limited number of manufacturers that operate under cGMP regulations and that might be capable of manufacturing for us. Any performance failure on the part of our existing or future manufacturers could delay clinical development or marketing approval. If our current contract manufacturers cannot perform as agreed, we may be required to replace such manufacturers, and it may prove very difficult and time consuming to identify potential alternative manufacturers who could manufacture our product candidates. Accordingly, we may incur added costs and delays in identifying and qualifying any such replacement.

Our current and anticipated future dependence upon others for the manufacture of our product candidates or products may adversely affect our future profit margins and our ability to commercialize any products that receive marketing approval on a timely and competitive basis.

If our third-party drug suppliers fail to achieve and maintain high manufacturing standards in compliance with cGMP regulations, we could be subject to certain product liability claims in the event such failure to comply resulted in defective products that caused injury or harm.

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***We are required to order the API used in our drug candidates from our manufacturers significantly in advance of our delivery needs, and problems with our forecasts related to the manufacturer of the API used in our drug candidates may delay our clinical trials.***

We are responsible for matching our manufacturing forecasts with our expected trial recruitment and ensuring that the API's used in our product candidates are manufactured in accordance with applicable regulations. We are generally required to provide our manufacturers with these forecasts significantly in advance of our delivery dates. If we underestimate our product needs and are required to order additional API, we may experience substantial delays in receiving such product, which could delay or suspend our clinical trials and adversely affect our development timelines. Conversely, if we overestimate our product needs, we may expend unnecessary working capital and experience reduced liquidity. Because we have limited experience in conducting clinical trials, our ability to accurately forecast our product needs may be less developed than that of our larger, more experienced competitors, increasing our exposure to these risks.

***We cannot guarantee how long it will take regulatory agencies to review our applications for product candidates, and we may fail to obtain the necessary regulatory approvals to market our product candidates. If we are not able to obtain required regulatory approvals, we will not be able to commercialize our product candidates and our ability to generate revenue will be materially impaired.***

Our business currently depends on the successful development and commercialization of our drug candidates. Our ability to generate revenue related to product sales, if ever, will depend on the successful development and regulatory approval of our drug candidates.

We currently have no products approved for sale and we cannot guarantee that we will ever have marketable products. The development of a product candidate and issues relating to its approval and marketing are subject to extensive regulation by the FDA in the United States and regulatory authorities in other countries, with regulations differing from country to country. We are not permitted to market our product candidates in the United States until we receive approval of an NDA from the FDA. We have not submitted any marketing applications for any of our product candidates.

NDAs must include extensive preclinical and clinical data and supporting information to establish the product candidate's safety and effectiveness for each desired indication. NDAs must also include significant information regarding the chemistry, manufacturing and controls for the product. Obtaining approval of an NDA is a lengthy, expensive and uncertain process, and we may not be successful in obtaining approval. The FDA review processes can take years to complete and approval is never guaranteed.

If we submit an NDA to the FDA, the FDA must decide whether to accept or reject the submission for filing. We cannot be certain that any submissions will be accepted for filing and review by the FDA. Regulators in other jurisdictions have their own procedures for approval of product candidates. Even if a product is approved, the FDA may limit the indications for which the product may be marketed, require extensive warnings on the product labeling or require expensive and time-consuming clinical trials or reporting as conditions of approval. Regulatory authorities in countries outside of the United States and Europe also have requirements for approval of drug candidates with which we must comply with prior to marketing in those countries. Obtaining regulatory approval for marketing of a product candidate in one country does not ensure that we will be able to obtain regulatory approval in any other country. In addition, delays in approvals or rejections of marketing applications in the United States, Europe or other countries may be based upon many factors, including regulatory requests for additional analyses, reports, data, preclinical studies and clinical trials, regulatory questions regarding different interpretations of data and results, changes in regulatory policy during the period of product development and the emergence of new information regarding our product candidates or other products. Also, regulatory approval for any of our product candidates may be withdrawn.

If we are unable to obtain approval from the FDA, or other regulatory agencies, for any of our product candidates, or if, subsequent to approval, we are unable to successfully commercialize our product candidates, we will not be able to generate sufficient revenue to become profitable or to continue our operations.

The development of our product candidates also may be delayed by other events beyond our control. For example, actions to limit federal agency budgets or personnel, may result in reductions to the FDA's budget, employees, and operations, as well as changes to FDA regulatory programs, all of which may lead to slower response times and longer review periods, potentially affecting our ability to progress development of our product candidates, undergo regulatory inspections or obtain regulatory approval for our product candidates.

Any statements in this report indicating that any of our drug candidates have demonstrated preliminary evidence of efficacy are our own and are not based on the FDA's or any other comparable governmental agency's assessment and do not indicate that such drug candidate will achieve favorable efficacy results in any later stage trials or that the FDA or any comparable agency will ultimately determine that such drug candidate is effective for purposes of granting marketing approval.

***Changes in funding for the FDA and other government agencies and the implementation of tariffs could prevent new products and services from being developed or commercialized in a timely manner or at all, which could negatively impact our business.***

The ability of the FDA to review and approve new products can be affected by a variety of factors, including government budget and funding levels, payment of user fees and reauthorization of user fee programs, staffing and other resource limitations, ability to hire and retain key personnel, as well as statutory, regulatory and policy changes. In addition, funding of other government agencies that support research and development activities that pertain to FDA review, such as research to understand new technologies or establish new standards, is subject to the political process, which is inherently fluid and unpredictable. Such government agencies also have been subject to reductions in funding and downsizing of agency staffing levels, which could materially impact our business and operations.

The current administration has implemented or proposed policies that may affect the FDA review process, including efforts to downsize the federal workforce, remove job elimination protections for federal workers, limit certain communications, and potentially impact user fee reauthorization. If political pressure or global health concerns prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

In addition, a portion of our supply chain is located in countries that may be subject to new or increased tariffs, which could lead to increased costs to us. This exposure to international trade policies poses a risk to our operations and our financial condition.

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***Delays in the commencement, enrollment and completion of clinical trials could result in increased costs to us and delay or limit our ability to obtain regulatory approval for any of our product candidates.***

Delays in the commencement, enrollment and completion of clinical trials could increase our product development costs or limit the regulatory approval of our product candidates. We do not know whether any future trials or studies of our other product candidates will begin on time or will be completed on schedule, if at all. The start or end of a clinical trial is often delayed or halted due to changing regulatory requirements, manufacturing challenges, including delays or shortages in available drug product, required clinical trial administrative actions, slower than anticipated subject enrollment, changing standards of care, availability or prevalence of use of a comparative drug or required prior therapy, clinical outcomes or financial constraints. For instance, delays or difficulties in subject enrollment or difficulties in retaining trial participants can result in increased costs, longer development times or termination of a clinical trial. Clinical trials of a new product candidate require the enrollment of a sufficient number of subjects, including subjects who are suffering from the disease the product candidate is intended to treat and who meet other eligibility criteria. Rates of subject enrollment are affected by many factors, including the size of the patient population, the eligibility criteria for the clinical trial, that include the age and condition of the subjects and the stage and severity of disease, the nature of the protocol, the proximity of subjects to clinical sites and the availability of effective treatments and/or availability of investigational treatment options for the relevant disease.

A product candidate can unexpectedly fail at any stage of preclinical and clinical development. The historical failure rate for product candidates is high due to scientific feasibility, safety, efficacy, changing standards of medical care and other variables. The results from preclinical testing or early clinical trials of a product candidate may not predict the results that will be obtained in later phase clinical trials of the product candidate. We, the FDA or other applicable regulatory authorities may suspend clinical trials of a product candidate at any time for various reasons, including, but not limited to, a belief that subjects participating in such trials are being exposed to unacceptable health risks or adverse side effects, or other adverse initial experiences or findings. We may not have the financial resources to continue development of, or to enter into collaborations for, a product candidate if we experience any problems or other unforeseen events that delay or prevent regulatory approval of, or our ability to commercialize, product candidates, including:

• inability to obtain sufficient funds required for a clinical trial;

• inability to reach agreements on acceptable terms with prospective CROs and trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites;

• clinical sites dropping out of a clinical trial;

• time required to add new clinical sites;

• negative or inconclusive results from our clinical trials or the clinical trials of others for product candidates similar to ours, leading to a decision or requirement to conduct additional preclinical testing or clinical trials or abandon a program;

• serious and unexpected drug-related side effects experienced by subjects in our clinical trials or by individuals using drugs similar to our product candidates;

• conditions imposed by the FDA or comparable foreign authorities regarding the scope or design of our clinical trials;

• delays in or inability to enroll research subjects in sufficient numbers or at the expected rate;

• high drop-out rates and high fail rates of research subjects;

• imposition of a clinical hold following an inspection of our clinical trial operations or trial sites by the FDA or foreign regulatory authorities;

• delays or failures in obtaining required IRB approval;

• inadequate supply or quality of product candidate components or materials or other supplies necessary for the conduct of our clinical trials; failure to comply with GLP, GCP, cGMP or similar foreign regulatory requirements that affect the conduct of pre-clinical and clinical studies and the manufacturing of product candidates;

• greater than anticipated clinical trial costs;

• poor efficacy of our product candidates during clinical trials;

• requests by regulatory authorities for additional data or clinical trials;

• governmental or regulatory agency assessments of pre-clinical or clinical testing that differ from our interpretations or conclusions;

• governmental or regulatory delays, or changes in approval policies or regulations; or

• unfavorable FDA or other regulatory agency inspection and review of a clinical trial site or vendor.

We, the FDA, other regulatory authorities outside the United States, or an IRB may suspend a clinical trial at any time for various reasons, including if it appears that the clinical trial is exposing participants to unacceptable health risks or if the FDA or one or more other regulatory authorities outside the United States find deficiencies in our IND or similar application outside the United States or the conduct of the trial. If we experience delays in the completion of, or the termination of, any clinical trial of any of our product candidates, the commercial prospects of such product candidate will be harmed, and our ability to generate product revenues from such product candidate will be delayed. In addition, any delays in completing our clinical trials will increase our costs, slow down our product candidate development and approval process, and jeopardize our ability to commence product sales and generate revenues. Any of these occurrences may harm our business, financial condition, results of operations, cash flows and prospects significantly. In addition, 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 regulatory approval of our product candidates.

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***As an organization, we have never before conducted pivotal clinical trials, and we may be unable to do so for any product candidates we may develop.***

We will need to successfully complete pivotal clinical trials in order to obtain the approval of the FDA, EMA or other regulatory agencies to market our product candidates. Carrying out pivotal clinical trials is a complicated process. As an organization, we have limited experience in successfully executing earlier-stage clinical trials, and, prior to the MIRACLE trial currently underway, we had not previously conducted any later stage or pivotal clinical trials. In order to do so, we are expanding our clinical development and regulatory capabilities, and we may be unable to retain qualified personnel. We also expect to continue to rely on third parties to conduct our pivotal clinical trials. Consequently, we may be unable to successfully and efficiently execute and complete necessary clinical trials in a way that leads to NDA submission and approval of our product candidates. We may require more time and incur greater costs than our competitors and may not succeed in obtaining regulatory approvals of product candidates that we develop. Failure to commence or complete, or delays in, our planned clinical trials, could prevent us from or delay us in commercializing our product candidates.

***We may expend significant resources to pursue certain product candidates for specific indications and fail to capitalize on the potential of such product candidates for the potential treatment of other indications that may be more profitable or for which there is a greater likelihood of success.***

Because we have limited financial and managerial resources, we focus on research programs and product candidates for specific indications. Specifically, with regard to Annamycin, we are focusing our efforts on the treatment of AML and STS lung mets. As a result, we may forego or delay pursuit of opportunities with Annamycin or other product candidates for the treatment of other indications that later prove to have greater commercial potential. Our resource allocation decisions may cause us to fail to capitalize on viable commercial products or profitable market opportunities. Our spending on current and future research and development programs and product candidates for specific indications may not yield any commercially viable products. Furthermore, until such time as we are able to build a broader product candidate pipeline, if ever, any adverse developments with respect to our current product candidates would have a more significant adverse effect on our overall business than if we maintained a broader portfolio of product candidates.

***We have commenced clinical trials and have never submitted an NDA, and any product candidate we advance through clinical trials may not have favorable results in later clinical trials or receive regulatory approval.***

Clinical failure can occur at any stage of our clinical development. Clinical trials may produce negative or inconclusive results, and our collaborators or we may decide, or regulators may require us, to conduct additional clinical trials or nonclinical studies. In addition, data obtained from trials and studies are susceptible to varying interpretations, and regulators may not interpret our data as favorably as we do, which may delay, limit or prevent regulatory approval. Success in preclinical studies and early clinical trials does not ensure that subsequent clinical trials will generate the same or similar results or otherwise provide adequate data to demonstrate the efficacy and safety of a product candidate. A number of companies in the pharmaceutical industry, including those with greater resources and experience than us, have suffered significant setbacks in clinical trials, even after seeing promising results in earlier clinical trials. The commencement and completion of future clinical trials could be substantially delayed or prevented by several factors, including, but not limited to:

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| | |
|:---|:---|
| • •  | failure to reach agreement with the FDA or other regulatory agency requirements for clinical trial design or scope of the development program;<br>a limited number of, and competition for, suitable subjects with particular types of cancer and viruses for enrollment in our clinical trials; |

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• delays or failures in reaching acceptable clinical trial agreement terms with CROs or clinical trial sites;

• delays or inability to attract clinical investigators for trials;

• clinical sites dropping out of a clinical trial;

• time required to add new clinical sites;

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| | |
|:---|:---|
| • • •  | failure of subjects to complete the clinical trial or inability to follow subjects adequately after treatment;<br>failures by, changes in our relationship with, or other issues at, CROs, vendors and investigators responsible for pre-clinical testing and clinical trials;<br>imposition of a clinical hold; and |

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• unforeseen safety issues.

In addition, the design of a clinical trial can determine whether its results will support approval of a product and flaws in the design of a clinical trial may not become apparent until the clinical trial is well advanced. We may be unable to design and execute a clinical trial to support regulatory approval. Further, clinical trials of potential products often reveal that it is not practical or feasible to continue development efforts.

***We may find it difficult to enroll subjects in our clinical trials, which could delay or prevent clinical trials of our product candidates.***

Identifying and qualifying subjects to participate in clinical trials of our product candidates is critical to our success. The timing of our clinical trials depends in part on the speed at which we can recruit subjects to participate in testing our product candidates. If subjects are unwilling to participate in our trials because of negative publicity from adverse events in the biotechnology industry, public perception of vaccine safety issues or for other reasons, including competitive clinical trials for similar patient populations, the timeline for recruiting subjects, conducting studies and obtaining regulatory approval of potential products may be delayed. These delays could result in increased costs, delays in advancing our product development, delays in testing the effectiveness of our technology or termination of the clinical trials altogether.

We may not be able to identify, recruit and enroll a sufficient number of subjects, or those with required or desired characteristics to achieve diversity in a clinical trial, or complete our clinical trials in a timely manner. Subject enrollment is affected by a variety factors including, among others:

• severity of the disease under investigation;

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• design of the trial protocol and size of the patient population required for analysis of the trial's primary endpoints;

• size of the patient population;

• eligibility criteria for the trial in question;

• perceived risks and benefits of the product candidate being tested;

• willingness or availability of subjects to participate in our clinical trials;

• willingness of the investigators to accept the trial design, including the control arm, of the study;

• proximity and availability of clinical trial sites for prospective subjects;

• our ability to recruit clinical trial investigators with the appropriate competencies and experience;

• availability of competing vaccines and/or therapies and related clinical trials;

• efforts to facilitate timely enrollment in clinical trials;

• our ability to obtain and maintain subject consents;

• the risk that subjects enrolled in clinical trials will drop out of the trials before completion;

• subject referral practices of physicians; and

• ability to monitor subjects adequately during and after treatment.

We may not be able to initiate or continue clinical trials if we cannot enroll a sufficient number of eligible subjects to participate in the clinical trials required by regulatory agencies.

Even if we enroll a sufficient number of eligible subjects to initiate our clinical trials, we may be unable to maintain participation of these subjects throughout the course of the clinical trial as required by the clinical trial protocol, in which event we may be unable to use the research results from those subjects. If we have difficulty enrolling and maintaining the enrollment of a sufficient number of subjects to conduct our clinical trials as planned, we may need to delay, limit or terminate ongoing or planned clinical trials, any of which would have an adverse effect on our business.

***A portion of our clinical development plan relies on physician-sponsored trials, which we do not control, and which may encounter delays for reasons outside of our control.***

Our drug product candidate, WP1066, was in two physician-sponsored Phase 1 clinical trials, one for adult GBM and another for pediatric brain tumors. Our drug product candidate, Annamycin, was in a physician-sponsored Phase 1b/2 clinical trial in Poland for the treatment of STS lung metastases. These physician-sponsored trials are an important part of our clinical development plan. Although we provide drug product and other minor supporting activities for these clinical trials, we are not otherwise directly involved in these physician-sponsored trials. As such, we are dependent on the institutions conducting the trials to proceed with such trials on a timely basis, and we have in the past encountered unforeseen delays in our physician-sponsored trials. We can provide no assurance that we will not encounter future delays with our physician-sponsored trials.

***If any of our drug product candidates are found to be unsafe or lack sufficient efficacy, we will not be able to obtain regulatory approval for it and our business would be harmed.***

In some instances, there can be significant variability in safety and/or efficacy results between different trials of the same product candidate due to numerous factors, including changes in trial protocols, differences in composition of the patient populations, adherence to the dosing regimen and other trial protocols and the rate of dropout among clinical trial participants. We do not know whether any clinical trials we or any of our potential future collaborators may conduct will demonstrate the consistent or sufficient efficacy and safety that would be required to obtain regulatory approval and market any products. If we are unable to bring any of our drug candidates to market, or to acquire other products that are on the market or can be developed, our ability to create long-term stockholder value will be limited.

***Our product candidates may have undesirable side effects that may delay or prevent marketing approval, or, if approval is received, require them to be taken off the market, require them to include safety warnings or otherwise limit their sales.***

Significant adverse events caused by our product candidates or even competing products in development that utilize a common mechanism of action could cause us, an IRB or ethics committee, and/or regulatory authorities to interrupt, delay or halt clinical trials and could result in clinical trial challenges such as difficulties in subject recruitment, retention, and adherence, the denial of regulatory approval by the FDA or other regulatory authorities and potential product liability claims. Serious adverse events deemed to be caused by our product candidates could have a material adverse effect on the development of our product candidates and our business as a whole. Unforeseen side effects from any of our product candidates could arise either during clinical development or, if any product candidates are approved, after the approved product has been marketed. In clinical trials, both with prior developers and with ours using Annamycin, subjects have experienced adverse events. There can be no assurance that other adverse events may not emerge related to our drug. Additional or unforeseen side effects from Annamycin or any of our other product candidates could arise either during clinical development or, if approved, after the approved product has been marketed.

The range and potential severity of possible side effects from oncology therapies such as our drug candidates are significant. If any of our drug candidates cause undesirable or unacceptable side effects in the future, this could interrupt, delay or halt clinical trials and result in the failure to obtain or suspension or termination of marketing approval from the FDA and other regulatory authorities or result in marketing approval from the FDA and other regulatory authorities only with restrictive label warnings or other limitations.

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If any of our product candidates receives marketing approval and we or others later identify undesirable or unacceptable side effects caused by such products:

• regulatory authorities may require the addition of labeling statements, specific warnings, a contraindication or field alerts to physicians and pharmacies;

• we may be required to change instructions regarding the way the product is administered, conduct additional clinical trials or change the labeling of the product;

• we may be subject to limitations on how we may promote the product;

• sales of the product may decrease significantly;

• regulatory authorities may require us to take our approved product off the market;

• we may be subject to litigation or product liability claims; and

• our reputation may suffer.

Any of these events could prevent us or our potential future collaborators from achieving or maintaining market acceptance of the affected product or could substantially increase commercialization costs and expenses, which in turn could delay or prevent us from generating significant revenues from the sale of our products.

***Even if our product candidates otherwise qualify for approval from the FDA, if the FDA does not find the manufacturing facilities of our future contract manufacturers acceptable for commercial production, we may not be able to commercialize our product candidates.***

We are currently utilizing contract manufacturers for the production of the active pharmaceutical ingredients and the formulation of drug product candidates for our clinical trials. Additionally, even if our product candidates would otherwise qualify for approval from the FDA based on results from preclinical and clinical trials, we do not intend to manufacture the approved pharmaceutical products. We do not currently have agreements for the commercial manufacture of Annamycin or any of our other product candidates and we may not be able to reach agreements with these or other contract manufacturers for sufficient commercial supplies of Annamycin if it is approved. Additionally, the facilities used by any contract manufacturer to manufacture any of our product candidates must be the subject of a satisfactory inspection before the FDA approves the product candidate manufactured at that facility. We are completely dependent on these third-party manufacturers for compliance with the requirements of US and non-US regulators for the manufacture of our products. If our manufacturers cannot successfully manufacture material that conforms to our specifications and the FDA's cGMP requirements, and other requirements of any governmental agency whose jurisdiction to which we are subject, our product candidates will not be approved or, if already approved, may be subject to recalls or other negative actions. Reliance on third-party manufacturers entails risks to which we would not be subject if we manufactured our product candidates, including:

• the possibility that we are unable to enter into a manufacturing agreement with a third party to manufacture our product candidates;

• the possible breach of the manufacturing agreements by the third parties because of factors beyond our control; and

• the possibility of termination or nonrenewal of the agreements by the third parties before we are able to arrange for a qualified replacement third-party manufacturer.

Any of these factors could prevent or cause the delay of approval or commercialization of our product candidates, cause us to incur higher costs or prevent us from commercializing our product candidates successfully. Furthermore, if any of our product candidates are approved and contract manufacturers fail to deliver the required commercial quantities of finished product on a timely basis at commercially reasonable prices and we are unable to find one or more replacement manufacturers capable of production at a substantially equivalent cost, in substantially equivalent volumes and quality and on a timely basis, we would likely be unable to meet demand for our products and could lose potential revenue. It may take several years to establish an alternative source of supply for our product candidates and to have any such new source approved by the government agencies that regulate our products.

***We received ODD for Annamycin, WP1066, and WP1122, but even if either product candidate is approved and receives ODE, ODE may not effectively prevent approval of a competing product.***

In 2017, we received notice that the FDA granted ODD for Annamycin for the treatment of AML and in 2020 we received notice that the FDA granted ODD for Annamycin for the treatment of soft tissue sarcomas. In February 2019, we received notice that the FDA granted ODD for WP1066 for the treatment of glioblastoma and later on for WP1122, as well.

ODD from the FDA is available for drugs targeting diseases with less than 200,000 cases per year. ODD does not convey any advantage in, or shorten the duration of, the regulatory review and approval process. However, ODD may enable market exclusivity of 7 years from the date of approval of an NDA in the United States. During that period the FDA generally could not approve another product containing the same drug for the same designated indication. Orphan drug exclusivity will not bar approval of another product under certain circumstances, including if a subsequent product with the same active ingredient for the same indication is shown to be clinically superior to the approved product on the basis of greater efficacy or safety, or providing a major contribution to patient care, or if the company with orphan drug exclusivity is not able to meet market demand. Even if either Annamycin or WP1066 is approved and ODE is granted, we cannot know that the exclusivity will prevent approval of another product containing Annamycin and intended to treat AML or soft tissue sarcomas, or WP1066 and intended to treat glioblastoma, because any such subsequent product could be demonstrated to be clinically superior to Annamycin or WP1066.

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***We received four rare pediatric disease designations for WP1066, but may not be able to obtain a rare pediatric disease priority review voucher if WP1066 is approved or obtain future rare pediatric disease designations for our product candidates, which could adversely affect our potential profitability.***

We have obtained rare pediatric disease designation from the FDA for WP1066 for the treatment of ependymoma, DIPG, medulloblastoma and atypical teratoid rhabdoid tumor. Under the FDA's RPDPRV program, upon the approval of an NDA for the treatment of a rare pediatric disease, the sponsor of such application may be eligible for an RPDPRV that can be used to obtain priority review for a subsequent NDA or Biologics License Application (BLA). A rare pediatric disease designation does not guarantee that a sponsor will receive a PRV upon approval of its application. If an RPDPRV is received, it may be sold or transferred an unlimited number of times and may have significant value. However, the FDA's RPDPRV program began to sunset on December 20, 2024, upon Congress' failure to pass a continuing resolution package that included its reauthorization. Under the amended statutory sunset provisions, after December 20, 2024, the FDA may award an RPDPRV for an approved rare pediatric disease product application only if the sponsor has rare pediatric disease designation for the drug and if that designation was granted by December 20, 2024. After September 30, 2026, the FDA may not award any RPDPRVs. Congress may vote to reauthorize this program, but its future remains unknown at this time. Failure of Congress to reauthorize the program will limit our ability to obtain an RPDPRV if WP1066 is approved for the treatment any of the four pediatric cancer indications for which WP1066 received rare pediatric disease designation and may limit our ability to obtain future rare pediatric disease designations for our product candidates.

***The regulatory approval processes of the FDA and comparable foreign authorities are lengthy, time consuming and inherently unpredictable, and even if we obtain approval for a product candidate in one country or jurisdiction, we may never obtain approval for or commercialize it in any other jurisdiction, which would limit our ability to realize our full market potential.***

Before obtaining approval to commercialize a product candidate in any jurisdiction, we and our collaborators must demonstrate to the satisfaction of the FDA or comparable foreign regulatory agencies that such product candidates are safe and effective for their intended uses. The FDA requires "substantial evidence" to make a finding of effectiveness for any approval. Substantial evidence generally requires two adequate and well-controlled studies; however, in certain circumstances, substantial evidence may be based on a single, large, multicenter, adequate and well-controlled study together with confirmatory evidence. Results from nonclinical studies and clinical trials can be interpreted in different ways. Even if we believe the nonclinical or clinical data for a product candidate are promising, such data may not be sufficient to support approval by the FDA and other regulatory authorities. In order to market any products in any particular jurisdiction, we must establish and comply with numerous and varying regulatory requirements on a country-by-country basis regarding safety and efficacy. Approval by the FDA does not ensure approval by regulatory authorities in any other country or jurisdiction outside the United States. In addition, clinical trials conducted in one country may not be accepted by regulatory authorities in other countries, and regulatory approval in one country does not guarantee regulatory approval in any other country. We are conducting significant clinical trials of Annamycin in Europe based on discussions with local regulatory bodies, and our business strategy includes utilizing the results from these clinical trials in our FDA submissions. There is no assurance that the FDA will accept the results from these clinical trials, which could require us to conduct additional preclinical studies or clinical trials, either prior to or post-approval, in order to receive approval of our product candidates in the United States. Approval processes vary among countries and can involve additional product testing and validation, as well as additional administrative review periods. Seeking regulatory approval could result in difficulties and costs for us and require additional nonclinical studies or clinical trials, which could be costly and time consuming and could impair our ability to generate revenue from future drug sales or other sources. Regulatory requirements can vary widely from country to country and could delay or prevent the introduction of our products in those countries. We do not have any product candidates approved for sale in any jurisdiction, including in international markets, and we do not have experience in obtaining regulatory approval. If we fail to comply with regulatory requirements in international markets or to obtain and maintain required approvals, or if regulatory approvals in international markets are delayed, our target market will be reduced and our ability to realize the full market potential of any product we develop will be unrealized.

Even if we obtain regulatory approvals for our product candidates, such approvals will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, advertising, promotion, sampling, record keeping and submission of safety and other post-market information. Any regulatory approvals that we receive for our product candidates may also be subject to a risk evaluation and mitigation strategy (REMS), limitations on the approved indicated uses for which the drug may be marketed or to the conditions of approval, or contain requirements for potentially costly post-marketing testing, including Phase 4 trials, and surveillance to monitor the quality, safety and efficacy of the drug. Such regulatory requirements may differ from country to country depending on where we have received regulatory approval.

***We have received Fast Track designation for two of our product candidates and may seek the same designation for one of more of our other product candidates. Such designation may not actually lead to a faster development or regulatory review or approval process. Fast Track designation may also be rescinded if the FDA believes the designation is no longer supported by data from our clinical development program.***

If a product is intended for the treatment of a serious condition and nonclinical or clinical data demonstrate the potential to address unmet medical need for this condition, a product sponsor may apply for FDA Fast Track designation. FDA granted Fast Track designation to Annamycin for STS lung metastases and WP1122 for GBM. If we seek Fast Track designation for other indications on either of these or another product candidate, we may not receive it from the FDA. Additionally, even if we receive Fast Track designation, Fast Track designation does not ensure that we will receive marketing approval or that approval will be granted within any particular time frame. We may not experience a faster development or regulatory review or approval process with Fast Track designation compared to conventional FDA review procedures. In addition, the FDA may withdraw Fast Track designation if it believes that the designation is no longer supported by data from our clinical development program. Fast Track designation alone does not guarantee qualification for the FDA's priority review procedures or that we would ultimately obtain regulatory approval. We also are unable to predict the potential changes in regulatory interpretations or agency funding or staffing that may impact the FDA's use or implementation of the Fast Track designation.

***Interim or preliminary data from our clinical trials that we announce or publish from time to time may change as more subject data become available and are subject to audit and verification procedures that could result in material changes in the final data.***

We have in the past, and intend in the future, to publicly disclose preliminary data from our clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a full analysis of all data related to the particular trial. We also make assumptions, estimations, calculations and conclusions as part of our analyses of data, and we may not have received or had the opportunity to fully and carefully evaluate all data. As a result, the preliminary results that we report may differ from future results of the same trials, or different conclusions or considerations may qualify such results once additional data have been received and fully evaluated. Preliminary data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary data we previously published. As a result, preliminary data should be viewed with caution until the final data are available. We may also disclose interim data from our clinical trials. Interim data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as subject enrollment continues and more subject data becomes available. Adverse differences between preliminary or interim data and final data could significantly harm our business prospects. Further, disclosure of preliminary or interim data by us could result in volatility in the price of our common stock.

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In addition, others, including regulatory agencies, may not accept or agree with our assumptions, estimates, calculations, conclusions or analyses or may interpret or weigh the importance of data differently, which could impact the approvability of the particular drug candidate and our business in general. In addition, the information we choose to publicly disclose regarding a particular study or clinical trial is based on what is typically extensive information, and you or others may not agree with what we determine is the material or otherwise appropriate information to include in our disclosure, and any information we determine not to disclose may ultimately be deemed significant with respect to future decisions, conclusions, views, activities or otherwise regarding a particular drug candidate or our business. If the interim data that we report differ from actual results, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for and commercialize our current or any of our future drug candidates, our business, operating results, prospects or financial condition may be materially harmed.

***We may not be able to conduct, or contract others to conduct, animal testing in the future, which could harm our research and development activities.***

Certain laws and regulations relating to drug development require us to test our product candidates on animals before initiating clinical trials involving humans. Animal testing activities have been the subject of controversy and adverse publicity. Animal rights groups and other organizations and individuals have attempted to stop animal testing activities by pressing for legislation and regulation in these areas and by disrupting these activities through protests and other means. To the extent the activities of these groups are successful, our research and development activities may be interrupted or delayed.

***We, or our third-party manufacturers, may be unable to successfully scale-up manufacturing of our product candidates in sufficient quality and quantity, which would delay or prevent us from developing our product candidates and commercializing approved products, if any.***

In order to conduct clinical trials of our product candidates, we will need to manufacture them in large quantities. We, or any manufacturing partners, may be unable to successfully increase the manufacturing capacity for any of our product candidates in a timely or cost-effective manner, or at all. In addition, quality issues may arise during scale-up activities. If we or any manufacturing partners are unable to successfully scale up the manufacture of our product candidates in sufficient quality and quantity, the development, testing and clinical trials of that product candidate may be delayed or become infeasible, and regulatory approval or commercial launch of any resulting product may be delayed or not obtained, which could significantly harm our business. In addition, the supply chain for the manufacturing of our product candidates is complicated and can involve several parties. If we were to experience any supply chain issues, our product supply could be seriously disrupted.

***Recently enacted legislation, future legislation and healthcare reform measures may increase the difficulty and cost for us to obtain marketing approval for and commercialize Annamycin and any future product candidates and may affect the prices we may set.***

The U.S. and state governments have shown significant interest in establishing cost containment measures to limit the growth of government-paid health care costs, including price controls, restrictions on reimbursement, and requirements for substitution of generic products for branded prescription drugs. For example, the Patient Protection and Affordable Care Act, as amended (the ACA), intended to reduce the cost of health care, and it has substantially changed the way health care is financed by both government and private insurers. While we cannot predict with certainty what impact on federal and other reimbursement policies this legislation will have in general or on our business specifically, the ACA may result in downward pressure on pharmaceutical reimbursement, which could negatively affect market acceptance of, and the price we may charge for, any products we develop that receives regulatory approval. Legislative changes to and regulatory changes under the ACA remain possible, but the nature and extent of such potential additional changes are uncertain at this time. In addition, the Inflation Reduction Act (IRA), among other things, (1) directs the Department of Health and Human Services (HHS) to negotiate the price of certain high-cost, single-source drugs and biologics covered under Medicare and (2) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation. Under the IRA, certain categories of drugs are excluded from price negotiations, including drugs that receive orphan drug designation as the only FDA-approved indication. While we have obtained orphan drug designation for Annamycin, if we seek additional indications, or fail to maintain our orphan drug status, we may become subject to the price negotiation process. This could reduce the ultimate price that we receive for Annamycin, which could negatively affect our business, results of operations, financial conditions, and prospects.

At the state level, individual states in the United States have also increasingly passed legislation and implemented regulations designed to control pharmaceutical and biological product pricing, including price reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. Further, some individual states have begun establishing Prescription Drug Affordability Boards to review high-cost drugs and, in some cases, set upper payment limits.

In June 2024, the U.S. Supreme Court reversed its longstanding approach under the Chevron doctrine, which provided for judicial deference to regulatory agencies, including the FDA. As a result of this decision, we cannot be sure whether there will be increased challenges to existing agency regulations or how lower courts will apply the decision in the context of other regulatory schemes without more specific guidance from the U.S. Supreme Court. For example, this decision may result in more companies bringing lawsuits against the FDA to challenge longstanding decisions and policies of the FDA, which could undermine the FDA's authority, lead to uncertainties in the industry, and disrupt the FDA's normal operations, which could impact the timely review of any regulatory filings or applications we submit to the FDA.

We cannot predict the likelihood, nature, or extent of health reform initiatives that may arise from future legislation or administrative action. We expect that the Affordable Care Act, Inflation Reduction Act, and other healthcare reform measures, including those that may be adopted in the future may result in additional reductions in Medicare and other healthcare funding, more rigorous coverage criteria, new payment methodologies and additional downward pressure on the price that we receive for any approved product. Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from third-party payors. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability or commercialize Annamycin, if approved.

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**Risks Related to our Intellectual Property**

***We rely*** ***on patents and other intellectual property rights to protect our product candidates, the attainment, enforcement, defense and maintenance of which may be challenging and costly. Failure to enforce or protect these rights adequately could harm our ability to compete and impair our business.***

Our commercial success depends in part on obtaining and maintaining patents and other forms of intellectual property protection, for example, for compositions-of-matter of our product candidates, formulations of our product candidates, polymorphs, salts and analogs of our product candidates, methods used to manufacture our product candidates, methods for manufacturing of the final drug product candidates, and methods of using our product candidates for the treatment of the indications we are developing or plan to develop, or on in-licensing such rights. Our patent portfolio comprises patents and patent applications which aspects of our product candidates Annamycin, WP1122 and WP1066. There is no assurance that our pending patent applications will result in issued patents, or if issued as patents, will include claims with sufficient scope of coverage to protect our product candidates, or that any pending patent applications will be issued as patents in a timely manner. Failure to obtain, maintain or extend adequate patent and other intellectual property rights could adversely affect our ability to develop and market our product candidates, resulting in harm to our business.

The composition of matter patent for Annamycin has expired. We are pursuing additional patents with claims directed to Annamycin drug product formulations and the methods of use of Annamycin to treat relapsed or refractory AML and other conditions, and methods for its manufacture, as the composition of matter patent protection for Annamycin has expired. As a result, competitors may be able to offer and sell products so long as these competitors do not infringe any other patents that third parties or we hold, including formulation, synthesis and method of use patents. However, particularly with regard to products approved for more than one indication, method of use patents may not provide significant protection, because a competitor could obtain approval for only a non-protected use and thus come to market, where the product may legally be prescribed for the protected use, thus undermining the protection provided by the patent. Although off-label prescriptions may infringe our method of use patents, the practice is common across medical specialties and such infringement is difficult to prevent or prosecute. Off-label sales would limit our ability to generate revenue from the sale of Annamycin, if approved for commercial sale.

The patent prosecution process is expensive and time-consuming. We or our licensors may not be able to prepare, file and prosecute all necessary or desirable patent applications for a commercially reasonable cost or in a timely manner or in all jurisdictions. It is also possible that we or our licensors 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 for them. Moreover, depending on the terms of any future in-licenses to which we may become a party, we may not have the right to control the preparation, filing and prosecution of patent applications, or to maintain the patents, covering technology in-licensed from third parties. Therefore, these patents and patent applications may not be prosecuted and enforced in a manner consistent with the best interests of our business.

Further, the issuance, scope, validity, enforceability, and commercial value of our and our current or future licensors' patent rights are highly uncertain. Our and our licensors' pending and future patent applications may not result in issued patents that protect our technology or product candidates, in whole or in part, or that effectively prevent others from commercializing competitive technologies and product candidates. The patent examination process may require us or our licensors to narrow the scope of the claims of our or our licensors' pending and future patent applications, which may limit the scope of patent protection that may be obtained. We cannot assure that all of the potentially relevant prior art relating to our patents and patent applications has been found. If such prior art exists, it can invalidate a patent or prevent a patent application from being issued as a patent. Even if patent applications do successfully issue as patents and even if such patents cover our product candidates, third parties may initiate an opposition, interference, reexamination, post grant review, inter partes review, nullification or derivation action in courts or before patent offices, or similar proceedings challenging the validity, enforceability, or scope of such patents, which may result in the patent claims being narrowed or invalidated. Our and our licensors' patent applications cannot be enforced against third parties practicing the technology claimed in such applications unless and until a patent is issued from such patent applications, and then only to the extent the issued claims cover the technology.

Because patent applications are confidential for a period of time after filing, and some remain so until issued, we cannot be certain that we or our licensors were the first to file any patent application related to our product candidates. Furthermore, in the U.S., if third parties have filed such patent applications on or before March 15, 2013, the date on which the U.S. changed from a first to invent to a first to file patent system, an interference proceeding can be initiated by such third parties to determine who was the first to invent any of the subject matter covered by the patent claims of our applications. If third parties have filed such applications after March 15, 2013, a derivation proceeding can be initiated by such third parties to determine whether our invention was derived from such third parties' product candidates. Even where we have a valid and enforceable patent, we may not be able to exclude others from practicing our invention where the other party can show that they used the invention in commerce before our filing date or the other party benefits from a compulsory license.

***We*** ***enjoy only limited geographical protection with respect to certain patents and may not be able to protect our intellectual property rights throughout the world.***

Filing and prosecuting patent applications and maintaining and defending patents covering our product candidates in all countries throughout the world would be prohibitively expensive. Competitors may use our and our licensors' technologies in jurisdictions where we have not obtained patent protection to develop their competitor's own product candidates and, further, may export otherwise infringing product candidates to territories where we and our licensors have patent protection, but enforcement rights are not as strong as that in the U.S. These product candidates may compete with our product candidates, and our and our licensors' patents or other intellectual property rights may not be effective or sufficient to prevent them from competing.

In addition, we may decide to abandon national and regional patent applications before grant. The examination of each national or regional patent application is an independent proceeding. As a result, patent applications in the same family may issue as patents in some jurisdictions, such as in the U.S., but may issue as patents with claims of different scope or may even be refused in other jurisdictions, such as in China, which has different requirements for patentability, including a stringent requirement for a detailed description of medical uses of a claimed drug. It is also quite common that depending on the country, the scope of patent protection may vary for the same product or technology.

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The laws of some jurisdictions do not protect intellectual property rights to the same extent as the laws or rules and regulations in the U.S., and many companies have encountered significant difficulties in protecting and defending such rights in such jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets and other intellectual property protection, which could make it difficult for us to stop the infringement of our patents or marketing of competing product candidates in violation of our proprietary rights generally. Proceedings to enforce our patent rights in other jurisdictions, whether or not successful, could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing as patents, and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate and the damages or other remedies awarded, if any, may not be commercially meaningful. Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license. Furthermore, while we intend to protect our intellectual property rights in our expected significant markets, we cannot ensure that we will be able to initiate or maintain similar efforts in all jurisdictions in which we may wish to market our product candidates. Accordingly, our efforts to protect our intellectual property rights in such countries may be inadequate, which may have an adverse effect on our ability to successfully commercialize our product candidates in all of our expected significant foreign markets. If we or our licensors encounter difficulties in protecting, or are otherwise precluded from effectively protecting, the intellectual property rights important for our business in such jurisdictions, the value of these rights may be diminished and we may face additional competition from others in those jurisdictions.

Some countries also have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties. In addition, some countries limit the enforceability of patents against government agencies or government contractors. In those countries, the patent owner may have limited remedies, which could materially diminish the value of such patents. If we or any of our licensors is forced to grant a license to third parties with respect to any patents relevant to our business, our competitive position may be impaired.

***The*** ***intellectual property rights we have licensed from MD Anderson are subject to the rights of the US government.***

We have obtained or have rights to a royalty-bearing, worldwide, exclusive license to intellectual property rights, including patent rights related to our Annamycin, WP1066 Portfolio and WP1122 Portfolio drug product candidates from MD Anderson. Some of our licensed intellectual property rights from MD Anderson have been developed in the course of research funded by the US government. As a result, the US government may have certain rights to intellectual property embodied in our current or future products pursuant to the Bayh-Dole Act of 1980. Government rights in certain inventions developed under a government-funded program include a non-exclusive, non-transferable, irrevocable worldwide license to use inventions for any governmental purpose. In addition, the US government has the right to require us, or an assignee or exclusive licensee to such inventions, to grant licenses to any of these inventions to a third party if they determine that: (i) adequate steps have not been taken to commercialize the invention; (ii) government action is necessary to meet public health or safety needs; (iii) government action is necessary to meet requirements for public use under federal regulations; or (iv) the right to use or sell such inventions is exclusively licensed to an entity within the US and substantially manufactured outside the US without the US government's prior approval. Additionally, we may be restricted from granting exclusive licenses for the right to use or sell our inventions created pursuant to such agreements unless the licensee agrees to additional restrictions (e.g., manufacturing substantially all of the invention in the US). The US government also has the right to take title to these inventions if we fail to disclose the invention to the government and fail to file an application to register the intellectual property within specified time limits. In addition, the US government may acquire title in any country in which a patent application is not filed within specified time limits. Additionally, certain inventions are subject to transfer restrictions during the term of these agreements and for a period, thereafter, including sales of products or components, transfers to foreign subsidiaries for the purpose of the relevant agreements, and transfers to certain foreign third parties. If any of our intellectual property becomes subject to any of the rights or remedies available to the US government or third parties pursuant to the Bayh-Dole Act of 1980, this could impair the value of our intellectual property and could adversely affect our business.

***Our patents*** ***and other proprietary rights may not adequately protect our technologies and product candidates and may not necessarily address all potential threats to our competitive advantage.***

The degree of protection afforded by our intellectual property rights is uncertain because intellectual property rights have limitations, and may not adequately protect our business, or permit us to maintain our competitive advantage. The following examples are illustrative:

• others may be able to make compounds that are the same as or similar to our product candidates but that are not covered by the claims of the patents that we own or have exclusively licensed;

• the patents of third parties may impair our ability to develop or commercialize our product candidates;

• the patents of third parties may be extended beyond the expected patent term and thus may impair our ability to develop or commercialize our product candidates;

• we or our licensors or any future strategic collaborators might not have been the first to conceive or reduce to practice the inventions covered by the issued patents or pending patent applications that we own or have exclusively licensed;

• we or our licensors or any future strategic collaborators might not have been the first to file patent applications covering our inventions, our product candidates, or uses of the product candidates in the indications under our development or to be developed;

• it is possible that the pending patent applications that we own or have exclusively licensed may not lead to issued patents;

• issued patents that we own or have exclusively licensed may not provide us with any competitive advantage, or may be held invalid or unenforceable, as a result of legal challenges by our competitors;

• issued patents that we own or have exclusively licensed may not provide coverage for all aspects of our product candidates in all countries, such as for uses of our product candidates in the indications under our development or to be developed;

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• others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing our intellectual property rights;

• our competitors might conduct research and development activities in countries where we do not have patent rights and then use the information learned from such activities to develop competitive product candidates for sale in our major commercial markets;

• others performing manufacturing or testing for us using our product candidates or technologies could use the intellectual property of others without obtaining a proper license;

• our or our licensors' inventions or technologies may be found to be not patentable; and

• we may not develop additional technologies that are patentable.

***We*** ***may become subject to third parties***' ***claims alleging infringement of third-party patents and proprietary rights, or we may be involved in lawsuits to protect or enforce our patents and other proprietary rights, which could be costly and time consuming, delay or prevent the development and commercialization of our product candidates, or put our patents and other proprietary rights at risk.***

Our commercial success depends, in part, upon our ability to develop, manufacture, market, and sell our product candidates without alleged or actual infringement, misappropriation, or other violation of the patents and proprietary rights of third parties. Litigation relating to patents and other intellectual property rights in the pharmaceutical industries is common, including patent infringement lawsuits and interferences, oppositions, and reexamination proceedings before the U.S. Patent and Trademark Office (the "USPTO"), and foreign patent offices. The various markets in which we plan to operate are subject to frequent and extensive litigation regarding patents and other intellectual property rights. In addition, many companies in intellectual property-dependent industries, including in the pharmaceutical industries, have employed intellectual property litigation as a means to gain an advantage over their competitors. Numerous U.S., and foreign issued patents and pending patent applications, which are owned by third parties, exist in the fields in which we are developing product candidates. Some claimants may have substantially greater resources than we have and may be able to sustain the costs of complex intellectual property litigation to a greater degree and for longer periods of time than we could. In addition, patent holding companies that focus solely on extracting royalties and settlements by enforcing patent rights may target us. As the pharmaceutical industries expand and more patents are issued, the risk increases that our product candidates may be subject to claims of infringement of the intellectual property rights of third parties.

We may be subject to third-party claims including infringement, interference or derivation proceedings, post-grant review and inter partes review before the USPTO, or similar adversarial proceedings or litigation in the U.S. and other jurisdictions. Even if we believe such claims are without merit, a court of competent jurisdiction could hold that these third-party patents are valid, enforceable and infringed, and the holders of any such patents may be able to block our ability to commercialize the applicable product unless we obtained a license under the applicable patents, or until such patents expire or are finally determined to be invalid or unenforceable. Similarly, if any third-party patents were held by a court of competent jurisdiction to cover aspects of our compositions, formulations, or methods of treatment, prevention, or use, the holders of any such patents may be able to block our ability to develop and commercialize the applicable product unless we obtained a license or until such patent expires or is finally determined to be invalid or unenforceable. In addition, defending such claims would cause us to incur substantial expenses and could cause us to pay substantial damages, if we are found to be infringing a third party's patent rights. These damages potentially include increased damages and attorneys' fees if we are found to have infringed such rights willfully.

Any of our patents may be challenged, narrowed, circumvented, or invalidated by third parties. The issuance of a patent is not conclusive as to its inventorship, scope, validity, or enforceability, and our patents may be challenged in the courts or patent offices in the U.S. and abroad. We may be subject to a third party pre-issuance submission of prior art to the USPTO or become involved in opposition, derivation, revocation, reexamination, post-grant and inter partes review, or interference proceedings challenging our patent rights or the patent rights of others. An adverse determination in any such submission, proceeding or litigation could reduce the scope of, 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. Moreover, we may have to participate in interference proceedings declared by the USPTO to determine priority of invention or in post-grant challenge proceedings, such as oppositions in a foreign patent office, that challenge priority of invention or other features of patentability. Such challenges may result in loss of patent rights, loss of exclusivity, or in patent claims being narrowed, invalidated, or held unenforceable, which 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 product candidates.

There is a risk that one or more third parties may choose to engage in litigation with us to enforce or to otherwise assert their patent rights against us. Even if we believe such claims are without merit, a court of competent jurisdiction could hold that one or more of these patents is valid, enforceable, and infringed, in which case the owners of any such patents may be able to block our ability to commercialize a product candidate unless we obtain a license under the applicable patents, or until such patents expire. However, such a license may not be available on commercially reasonable terms or at all. Such proceedings also may result in substantial cost and require significant time from us, even if the eventual outcome is favorable to us.

Further, if a patent infringement suit is brought against us or our third-party service providers, our development, manufacturing or sales activities relating to the product or product that is the subject of the suit may be delayed or terminated. As a result of patent infringement claims, or in order to avoid potential infringement claims, we may choose to seek, or be required to seek, a license from the third party, which would be likely to include a requirement to pay license fees or royalties or both. These licenses may not be available on acceptable terms or at all. Even if a license can be obtained on acceptable terms, the rights may be nonexclusive, which would give our competitors access to the same intellectual property rights. If we are unable to enter into a license on acceptable terms, we could be prevented from commercializing one or more of our product candidates, or forced to modify such product candidates, or to cease some aspect of our business operations, which could harm our business significantly. We might, if possible, also be forced to redesign our product candidates so that we no longer infringe the third-party intellectual property rights, which may result in significant cost and delay to us, or which redesign could be technically infeasible. Any of these events, even if we were ultimately to prevail, could require us to divert substantial financial and management resources that we would otherwise be able to devote to our business.

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If we were to initiate legal proceedings against a third party to enforce a patent covering one of our product candidates, the defendant could counterclaim that our patent is invalid or unenforceable. In patent litigation in the U.S. and in Europe, defendant counterclaims alleging invalidity or unenforceability are commonplace. Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, for example, lack of novelty, obviousness, or non-enablement. Third parties might allege unenforceability of our patents because someone connected with prosecution of the patent withheld relevant information, or made a misleading statement, during prosecution. The outcome of proceedings involving assertions of invalidity and unenforceability during patent litigation is unpredictable. With respect to the validity of patents, for example, we cannot be certain that there is no invalidating prior art of which we and the patent examiner were unaware during prosecution. There is a risk that in connection with such proceedings, a court will decide that a patent of ours is invalid or unenforceable, in whole or in part, and that we do not have the right to stop the other party from using the invention at issue. If a defendant were to prevail on a legal assertion of invalidity or unenforceability, we would lose at least part, and perhaps all, of the patent protection on our product candidates. There is also a risk that, even if the validity of such patents is upheld, the court will construe the patent's claims narrowly or decide that we do not have the right to stop the other party from using the invention at issue on the grounds that our patent claims do not cover the invention. Even if we establish infringement, the court may decide not to grant an injunction against further infringing activity and instead award only monetary damages, which may or may not be an adequate remedy. An adverse outcome in a litigation or proceeding involving one or more of our patents could limit our ability to assert those patents against those parties or other competitors, and may curtail or preclude our ability to exclude third parties from making and selling similar or competing product candidates. In addition, if the breadth or strength of protection provided by our patents is threatened, it could dissuade companies from collaborating with us to license, develop, or commercialize our current or future product candidates.

Furthermore, our patents and other intellectual property rights also will not protect our technology if competitors and other third parties design around our protected technology without infringing our patents or other intellectual property rights. For example, a third party may develop a competitive product that provides benefits similar to our product candidates but that uses a technology that falls outside the scope of our patent protection. Our competitors may also seek approval to market generic versions of any approved products and in connection with seeking such approval may claim that our patents are invalid, unenforceable or not infringed. In these circumstances, we may need to defend or assert our patents, or both, including by filing lawsuits alleging patent infringement. In any of these types of proceedings, a court or other agency with jurisdiction may find our patents invalid or unenforceable, or that our competitors are competing in a non-infringing manner. Thus, even if we have valid and enforceable patents, these patents still may not provide protection against competing products or processes sufficient to achieve our business objectives. If the patent protection provided by the patents and patent applications we hold or pursue with respect to our product candidates is not sufficiently broad to impede such competition, our ability to successfully commercialize our product candidates could be negatively affected.

Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. Even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses and could distract our technical and management personnel from their normal responsibilities. Such litigation or proceedings could substantially increase our operating losses and reduce our resources available for development activities. We may not have sufficient financial or other resources to adequately conduct such litigation or proceedings. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their substantially greater financial resources. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could have an adverse effect on our ability to compete in the marketplace. There could also be public announcements of the results of hearings, motions, or other interim proceedings or developments. If securities analysts or investors view these announcements in a negative light, the price of our stock could be adversely affected.

***We may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of a third-party patent which might adversely affect our ability to develop, manufacture and market our product candidates.***

We cannot guarantee that any of our, our licensors' patent searches or analyses, including but not limited to the identification of relevant patents, the scope of patent claims, or the expiration of relevant patent applications or patents, are complete or thorough, nor can we be certain that we have identified each and every third-party patent and patent application in the U.S., and elsewhere that is relevant to or necessary for the commercialization of our product candidates in any jurisdiction. For example, in the U.S., patent applications filed before November 29, 2000 and, upon request, certain patent applications filed after that date that will not be filed outside the U.S., remain confidential until those patent applications issue as patents. Patent applications in the U.S., EU, and elsewhere are published approximately 18 months after the earliest filing for which priority is claimed, with such earliest filing date being commonly referred to as the priority date. Therefore, patent applications covering our product candidates could have been filed by others without our knowledge, including any such patent applications that may claim priority from patent applications for patents that we have determined will expire before we commercialize our product candidates. Additionally, pending patent applications that have been published can, subject to certain limitations, be later amended in a manner that could cover our product candidates or the use of our product candidates. Moreover, as we study our product candidates during development, we may learn new information regarding their structure, composition, properties, or functions that may render third-party patent applications or patents that we had not identified as being, or that we had not believed to be, relevant to our product candidates instead to be relevant to or necessary for the commercialization of our product candidates in a jurisdiction. The scope of a patent claim is determined by an interpretation of the law, the written disclosure in the patent, and the patent's prosecution history. Our interpretation of the relevance or the scope of a patent or a pending patent application may be incorrect. We may incorrectly determine that our product candidates are not covered by a third-party patent or may incorrectly predict whether a third party's pending patent application will issue with claims of relevant scope. Our determination of the expiration date or the possibility of an extension of patent term of any patent in the U.S, Europe, or elsewhere that we consider relevant also may be incorrect. Any of the foregoing circumstances, failures, or errors may negatively impact our ability to develop and market our product candidates.

***If we breach any of the agreements under which we license patent rights or if we fail to meet certain development deadlines, pay certain fees including extension fees or exercise certain rights to technology, we could lose or fail to obtain license rights that are important to our business.***

We license all of our technology from MD Anderson, and we must meet various payment and other obligations under our license agreements with MD Anderson. Our license agreements generally require that we meet various milestones by certain dates, each of which generally requires the payment of additional fees, including extension fees. To date, we have been able to meet such milestones, pay certain fees or have been able to enter into extensions with MD Anderson related to such milestones, or have obtained options to acquire the technology. However, our failure to meet any financial or other obligations under our license agreements in a timely manner could result in the loss of our rights to our core technologies.

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We are a party to a number of license agreements with MD Anderson under which we are granted rights to intellectual property that are critical to our business and we expect that we will need to enter into additional license agreements in the future with MD Anderson based on development work we are pursuing under a sponsored research agreement. With respect to inventions arising from our sponsored research agreement, MD Anderson has provided us with an option to negotiate a royalty-bearing, exclusive license to any invention or discovery that is conceived or reduced to practice. However, regardless of such option to negotiate, we may be unable to negotiate a license within the specified time frame or under terms that are acceptable to us. If we are unable to do so, the institution may offer the intellectual property rights to other parties, potentially blocking our ability to pursue a program based on that technology.

We may enter into additional license agreements in the future. Our existing license agreements impose and any future license agreements are likely to impose various diligence, milestone payment, royalty, insurance and other obligations on us. Any uncured, material breach under these license agreements could result in the loss of our rights to practice such in-licensed intellectual property, and could compromise our development and commercialization efforts for any current or future product candidates.

***We may not be successful in maintaining necessary rights to our product candidates or obtaining patent or other intellectual property rights important to our business through acquisitions and in-licenses.***

We currently own and have in-licensed rights to intellectual property, including patents, patent applications and know-how, relating to our product candidates, and our success will likely depend on maintaining these rights. Because our programs may require the use of proprietary rights held by third parties, the growth of our business will likely depend in part on our ability to continue to acquire, in-license, maintain, or use these proprietary rights. In addition, our product candidates may require specific formulations to work effectively and the rights to those formulations or methods of making those formulations may be held by others. We may be unable to acquire or in-license any compositions, methods of use, processes, or other third-party intellectual property rights that we identify as necessary for the development and commercialization of our product candidates. The licensing and acquisition of third-party intellectual property rights is a competitive area, and a number of more established companies also are pursuing strategies to license or acquire third-party intellectual property rights that we may consider attractive. These established companies may have a competitive advantage over us due to their size, cash resources, and greater clinical development and commercialization capabilities.

In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us. We may also be unable to license or acquire third-party intellectual property rights on a timely basis, on terms that would allow us to make an appropriate return on our investment, or at all. Even if we are able to obtain a license to intellectual property of interest, we may not be able to secure exclusive rights, in which case others could use the same rights and compete with us. If we are unable to successfully obtain a license to third-party intellectual property rights necessary for the development of our product candidates or a development program on acceptable terms, we may have to abandon development of our product candidates or that development program.

***Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment, and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.***

Periodic maintenance and annuity fees on any issued patent are due to be paid to the USPTO and foreign patent agencies over the lifetime of a patent. In addition, the USPTO and other foreign patent agencies require compliance with a number of procedural, documentary, fee payment, and other similar provisions during the patent application process. While an inadvertent failure to make payment of such fees or to comply with such provisions can in many cases be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which such non-compliance will result in the abandonment or lapse of the patent or patent application, and the partial or complete loss of patent rights in the relevant jurisdiction. Non-compliance events that could result in abandonment or lapse of a patent or patent application include failure to respond to official actions within prescribed time limits, and non-payment of fees and failure to properly legalize and submit formal documents within prescribed time limits. If we or our licensors fail to maintain the patents and patent applications covering our product candidates or if we or our licensors otherwise allow our patents or patent applications to be abandoned or lapse, our competitors might be able to enter the market, which would hurt our competitive position and could impair our ability to successfully commercialize our product candidates in any indication for which they are approved.

***We may be subject to claims challenging the inventorship of our patents and other intellectual property.***

We may be subject to claims challenging the inventorship of our patents and patent applications or ownership of our intellectual property. In particular, we may be subject to claims that former employees or other third parties have an interest in our patents or other intellectual property as an inventor or co-inventor. While it is our policy to require our employees and contractors who may be involved in the conception or development of intellectual property to execute agreements assigning such intellectual property to us, we may be unsuccessful in executing such an agreement with each party who, in fact, conceives or develops intellectual property that we regard as our own. For example, the assignment of intellectual property rights may not be self-executing or the assignment agreements may be breached, or we may have inventorship disputes arise from conflicting obligations of consultants or others who are involved in developing our product candidates. Litigation may be necessary to defend against these and other claims challenging inventorship. If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights, such as exclusive ownership of, or right to use, valuable intellectual property. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees.

***Changes in patent laws or patent jurisprudence could diminish the value of patents in general, thereby impairing our ability to protect our product candidates.***

As is the case with other pharmaceutical companies, our success is heavily dependent on intellectual property, particularly patents. Obtaining and enforcing patents in the pharmaceutical industries involve both technological complexity and legal complexity. Therefore, obtaining and enforcing pharmaceutical patents is costly, time-consuming and inherently uncertain. In addition, the America Invents Act (the "AIA"), which was passed in September 2011, resulted in significant changes to the U.S. patent system. An important change introduced by the AIA is that, as of March 16, 2013, the U.S. transitioned to a "first-to-file" system for deciding which party should be granted a patent when two or more patent applications are filed by different parties claiming the same invention. A third party that files a patent application in the USPTO after that date but before us could therefore be awarded a patent covering an invention of ours even if we made the invention before it was made by the third party. This will require us to be cognizant going forward of the time from invention to filing of a patent application, but circumstances could prevent us from promptly filing patent applications on our inventions.

Among some of the other changes introduced by the AIA are changes to the limitation where a patent may be challenged, thus providing opportunities for third parties to challenge any issued patent in the USPTO. This applies to all of our U.S. patents, even those issued before March 16, 2013. Because of a lower evidentiary standard in USPTO proceedings compared to the evidentiary standard in U.S. federal courts necessary to invalidate a patent claim, a third party could potentially provide evidence in a USPTO proceeding sufficient for the USPTO to hold a claim invalid even though the same evidence would be insufficient to invalidate the claim if first presented in a district court action.

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Accordingly, a third party may attempt to use the USPTO proceedings to invalidate our patent claims that would not have been invalidated if first challenged by the third party as a defendant in a district court action. It is not clear what, if any, impact the AIA will have on the operation of our business. However, the AIA and its implementation could increase the uncertainties and costs surrounding the prosecution of our or our licensors' patent applications and the enforcement or defense of our or our licensors' issued patents.

Additionally, the U.S. Supreme Court has ruled on several patent cases in recent years either narrowing the scope of patent protection available in certain circumstances or weakening 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. Depending on decisions by Congress, the federal courts and the USPTO, the laws and regulations governing patents could change in unpredictable ways that could weaken our ability to obtain new patents or to enforce our existing patents and patents that we might obtain in the future. Similarly, the complexity and uncertainty of European patent laws have also increased in recent years. In addition, the European patent system is relatively stringent in the type of amendments that are allowed during prosecution. Complying with these laws and regulations could limit our ability to obtain new patents in the future that may be important for our business.

***If we do not obtain protection under the Hatch-Waxman Amendments and similar non-U.S. legislation for extending the term of patents covering our product candidates, our ability to compete effectively could be impaired.***

Depending upon the timing, duration and conditions of FDA marketing approval of our product candidates, one or more of our U.S. patents may be eligible for patent term extension under the Drug Price Competition and Patent Term Restoration Act of 1984, referred to as the "Hatch-Waxman Amendments." The Hatch-Waxman Amendments permit a patent term extension of up to five years for a patent covering an approved product or method of use as compensation for patent term lost during product development and the FDA regulatory review process. A patent term extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval. Similar patent term extensions may be available in other jurisdictions. For example, a supplementary protection certificate in Europe may be applied for approval to recover some of the time lost between the patent application filing date and the date of first marketing authorization. However, we may not receive an extension if we fail to apply within applicable deadlines, fail to apply prior to expiration of relevant patents, or otherwise fail to satisfy applicable requirements. Moreover, the length of the extension could be less than we request. If we are unable to obtain patent term extension or the term of any such extension is less than we request, the period during which we can enforce our patent rights for that product will be shortened and our competitors may obtain approval to market competing product candidates sooner. As a result, our revenue from applicable product candidates could be reduced, possibly materially.

***If our trademarks and trade names are not adequately protected, we may not be able to build name recognition in our markets of interest and our competitive position may be adversely affected.***

We may not be able to obtain trademark protection in territories that we consider of significant importance to us. In addition, any of our trademarks or trade names, whether registered or unregistered, may be challenged, opposed, infringed, cancelled, circumvented or declared generic, or determined to be infringing on other marks, as applicable. We may not be able to maintain and protect our rights to these trademarks and trade names, which we will need to build name recognition by potential collaborators or customers in our markets of interest. Over the long term, if we are unable to 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.

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

We consider proprietary trade secrets and confidential know-how and unpatented know-how to be important to our business. In addition to seeking patents for some of our technology and product candidates, we also may rely on trade secrets or confidential know-how to protect our technology, especially where patent protection is believed to be of limited value. However, trade secrets and confidential know-how are difficult to maintain as confidential.

To protect this type of information against disclosure or appropriation by competitors, our policy is to require our employees, consultants, contractors and advisors to enter into confidentiality agreements with us. We also seek to preserve the integrity and confidentiality of our data, trade secrets, and know-how by maintaining physical security of our premises and physical and electronic security of our information technology systems. Monitoring unauthorized uses and disclosures is difficult, and we cannot know whether the steps we have taken to protect our proprietary technologies will be effective. In addition, current or former employees, consultants, contractors, and advisers may unintentionally or willfully disclose our confidential information to competitors, and confidentiality agreements may not provide an adequate remedy in the event of unauthorized disclosure of confidential information. We therefore cannot guarantee that our trade secrets and other proprietary and confidential information will not be disclosed or that competitors will not otherwise gain access to our trade secrets. Enforcing a claim that a third party obtained illegally and is using trade secrets or confidential know-how is expensive, time consuming, and unpredictable. The enforceability of confidentiality agreements may vary from jurisdiction to jurisdiction. Furthermore, if a competitor lawfully obtained or independently developed any of our trade secrets, we would have no right to prevent such competitor from using that technology or information to compete with us, which could harm our competitive position. Additionally, if the steps taken to maintain our trade secrets are deemed inadequate, we may have insufficient recourse against third parties for misappropriating the trade secret.

Failure to protect or maintain trade secrets and confidential know-how could adversely affect our business and our competitive position. Moreover, our competitors may independently develop substantially equivalent proprietary information and may even apply for patent protection in respect of the same. If successful in obtaining such patent protection, our competitors could limit our use of our own trade secrets or confidential know-how.

***We may be subject to claims by third parties asserting that we or our employees have misappropriated third-party intellectual property, or claiming ownership of what we regard as our own intellectual property. These claims may be costly to defend and if we do not successfully do so, we may be required to pay monetary damages and lose valuable intellectual property rights or personnel.***

Some of our employees, including our senior management, were previously employed at other biopharmaceutical or pharmaceutical companies, including our competitors or potential competitors. Some of these employees executed proprietary rights, non-disclosure and non-competition agreements in connection with such previous employment. Although we try to ensure that our employees do not use the know-how, trade secrets, or other proprietary information of others in their work for us, we may be subject to claims that we or these employees have used or disclosed confidential information or intellectual property, including know-how, trade secrets, or other proprietary information, of any such employee's former employer. Litigation may be necessary to defend against these claims.

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If we fail in prosecuting or defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or personnel. A loss of key research personnel or their work product could hamper or undermine our ability to develop and commercialize our product candidates, which would severely harm our business. In addition, if such intellectual property rights were to be awarded to a third party, we could be required to obtain a license from such third party to commercialize our technology or product candidates. Such a license may not be available on commercially reasonable terms or at all, which could hamper or undermine our ability to develop and commercialize our product candidates, which would severely harm our business. Even if we successfully prosecute or defend against such claims, litigation could result in substantial costs and distract management from the development and commercialization of our product candidates.

***Our business and operations may suffer, and proprietary information may be lost, in the event of information technology system failures, cyberattacks or deficiencies in our cybersecurity.***

In the ordinary course of our business, we collect and store sensitive data, including intellectual property, clinical trial data, proprietary business information, personal data and personally identifiable information of our clinical trial subjects and employees, in our data centers and on our networks. The secure processing, maintenance and transmission of this information is critical to our operations. Despite our security measures, our information technology and infrastructure and those of our CROs or other contractors or consultants may be vulnerable to attack and damage from computer viruses and malware (e.g., ransomware), cybersecurity threats, unauthorized access, natural disasters, terrorism, war and telecommunications and electrical failures or breached due to employee error, malfeasance, or other disruptions. Attacks upon information technology systems are increasing in their frequency, levels of persistence, sophistication and intensity, and are being conducted by sophisticated and organized groups and individuals with a wide range of motives and expertise. Furthermore, because the techniques used to obtain unauthorized access to, or to sabotage, systems change frequently and often are not recognized until launched against a target, we may be unable to anticipate these techniques or implement adequate preventative measures. We may also experience security breaches that may remain undetected for an extended period. Even if identified, we may be unable to adequately investigate or remediate incidents or breaches due to attackers increasingly using tools and techniques that are designed to circumvent controls, to avoid detection, and to remove or obfuscate forensic evidence.

We and certain of our service providers are from time to time subject to cyber security incidents. Although, to our knowledge, we have not experienced any significant system failure, accident or security breach to date, any such event could compromise our networks and the information stored there could be accessed, publicly disclosed, lost, or stolen. Any such access, disclosure, or other loss of information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, and significant regulatory penalties; disrupt our operations; damage our reputation; and cause a loss of confidence in us and our ability to conduct clinical trials, which could adversely affect our reputation and delay our clinical development of our product candidates.

The loss of clinical trial data from completed, ongoing, or planned trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. We could also incur liability and the further development and commercialization of our product candidates could be delayed. In addition, we also rely on third parties to manufacture our product candidates, so similar events relating to their computer systems could also have a material adverse effect on our business. Further, our insurance coverage may not be sufficient to cover the financial, legal, business or reputational losses that may result from an interruption or breach of our systems.

In addition, due to continued hybrid working environment, varying parts of our workforce may work remotely on a part or full-time basis. This could increase our cyber security risk, create data accessibility concerns, and make us more susceptible to communication disruptions. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations or prospects.

**Risks Relating to Our Business and Our Financial Condition**

***We will require additional funding, which may not be available to us on acceptable terms, or at all, and, if not so available, may require us to delay, limit, reduce or cease our operations.***

We have used and we intend to use our current cash resources and the proceeds from any possible future offerings, to, among other uses, advance Annamycin, WP1122 and WP1066 for certain indications through clinical development, advancing the remainder of the existing portfolio through preclinical studies and into INDs or their equivalent, and sponsoring research at MD Anderson and HPI. Developing pharmaceutical products, including conducting preclinical studies and clinical trials, is expensive. We will require substantial additional future capital in order to complete clinical development and commercialize Annamycin and WP1066. If the FDA or its EU equivalent requires that we perform additional nonclinical studies or clinical trials, our expenses would further increase beyond what we currently expect and the anticipated timing of any potential approval of Annamycin would likely be delayed. Further, there can be no assurance that the costs we will need to incur to obtain regulatory approval of Annamycin will not increase.

***Because successful development of our product candidates is uncertain, we are unable to estimate the actual amount of funding we will require to complete research and development and commercialize our products under development.***

The amount and timing of our future funding requirements will depend on many factors, including but not limited to:

• whether our plan for clinical trials will be completed on a timely basis and, if completed, whether we will be able to publicly announce results from our phase I/II clinical trials in accordance with our announced milestones;

• whether the results of our clinical trials will be announced on a timely basis and, when announced, whether such results are in accordance with our expectations or our announced milestones;

• whether we are successful in obtaining the benefits of FDA's expedited development and review programs related to Annamycin or our other drug candidates;

• the progress, costs, results of and timing of our clinical trials and also of our preclinical studies;

• the outcome, costs and timing of seeking and obtaining FDA and any other regulatory approvals;

• the costs associated with securing and establishing commercialization and manufacturing capabilities;

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• market acceptance of our product candidates;

• the costs of acquiring, licensing or investing in businesses, products, product candidates and technologies;

• our ability to maintain, expand and enforce the scope of our intellectual property portfolio, including the amount and timing of any payments we may be required to make, or that we may receive, in connection with the licensing, filing, prosecution, defense and enforcement of any patents or other intellectual property rights;

• our need and ability to hire additional management and scientific and medical personnel;

• the effect of competing drug candidates and new product approvals;

• our need to implement additional internal systems and infrastructure, including financial and reporting systems; and

• the economic and other terms, timing of and success of our existing licensing arrangements and any collaboration, licensing or other arrangements into which we may enter in the future.

Some of these factors are outside of our control. Our existing capital resources are not sufficient to enable us to complete the development and commercialization of our product candidates, or to initiate any clinical trials or additional development work needed for any other drug candidates. Accordingly, we will need to raise additional funds in the future.

We may seek additional funding through a combination of equity offerings, debt financings, government or other third-party funding, commercialization, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements. Additional funding may not be available to us on acceptable terms or at all. In addition, the terms of any financing may adversely affect the holdings or the rights of our stockholders. In addition, the issuance of additional shares by us, or the possibility of such issuance, may cause the market price of our shares to decline.

If we are unable to obtain funding on a timely basis, we may be required to significantly curtail one or more of our research or development programs. We also could be required to seek funds through arrangements with collaborative partners or otherwise that may require us to relinquish rights to some of our technologies or product candidates or otherwise agree to terms unfavorable to us.

***We have commenced clinical trials,** **have a limited operating history and we expect a number of factors to cause our operating results to fluctuate on an annual basis, which may make it difficult to predict our future performance.***

We are a clinical stage pharmaceutical company with a limited operating history. Our operations to date have been limited to acquiring our technology portfolio, preparing several drugs for authorization to conduct clinical trials and conducting Phase 1 through Phase 3 clinical trials. We have yet to receive regulatory approvals for any of our drug candidates. Additionally, we have a limited amount of drug supply and the amount of drug required may depend upon subject response and the need for additional, unplanned treatments, making it difficult to predict the total amount of drug required.

Consequently, any predictions made about our future success or viability may not be as accurate as they could be if we had a longer operating history or approved products on the market. Our operating results are expected to significantly fluctuate from quarter-to-quarter or year-to-year due to a variety of factors, many of which are beyond our control. Factors relating to our business that may contribute to these fluctuations include:

• any delays in regulatory review and approval of our product candidates in clinical development, including our ability to receive approval from the FDA or the Polish authorities for our drugs in clinical trials;

• delays in the commencement, enrollment and timing of clinical trials;

• difficulties in identifying subjects suffering from our target indications;

• the success of our clinical trials through all phases of clinical development;

• potential side effects of our product candidates that could delay or prevent approval or cause an approved drug to be taken off the market;

• our ability to obtain additional funding to develop drug candidates;

• our ability to identify and develop additional drug candidates beyond Annamycin and our WP1066 and WP1122 Portfolios;

• competition from existing products or new products that continue to emerge;

• the ability of subjects or healthcare providers to obtain coverage or sufficient reimbursement for our products;

• our ability to adhere to clinical trial requirements directly or with third parties such as contract research organizations (CROs);

• our dependency on third-party manufacturers to manufacture our products and key ingredients;

• our ability to establish or maintain collaborations, licensing or other arrangements, particularly with MD Anderson;

• our ability to defend against any challenges to our intellectual property including, claims of patent infringement;

• our ability to enforce our intellectual property rights against potential competitors;

• our ability to secure additional intellectual property protection for our developing drug candidates and associated technologies;

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• our ability to attract and retain key personnel to manage our business effectively; and

• potential product liability claims.

Accordingly, the results of any historical quarterly or annual periods should not be relied upon as indications of future operating performance.

***We have in the past completed related party transactions that were not conducted on an arm's length basis.***

Prior to our IPO, we acquired (i) the rights to the license agreement with MD Anderson covering our WP1122 Portfolio held by IntertechBio Corporation, a company affiliated with certain members of our management and board of directors, and (ii) the rights to all data related to the development of Annamycin held by AnnaMed, Inc., a company affiliated with certain members of our management and board of directors. In addition, prior to our IPO, Moleculin, LLC merged with and into our company. Moleculin, LLC was affiliated with certain members of our management and board of directors. Prior to our IPO, we, on Moleculin, LLC's behalf, entered into an agreement with HPI whereby HPI agreed to terminate its option to sublicense certain rights to the WP1066 Portfolio and entered into a co-development agreement with us. Our co-founder, Dr. Waldemar Priebe, and a member of our management are shareholders of HPI. In addition, in February 2019, we entered into sublicense agreement with Animal Lifesciences, LLC. Dr. Priebe was affiliated with Animal Lifesciences, LLC at the time these agreements were executed. None of the foregoing transactions were conducted on an arm's length basis. As such, it is possible that the terms were less favorable to us than in an arm's length transaction.

***We have never been profitable, we have no products approved for commercial sale, and to date we have not generated any revenue from product sales. As a result, our ability to reduce our losses and reach profitability is unproven, and we may never achieve or sustain profitability.***

We have never been profitable and do not expect to be profitable in the foreseeable future. We have not yet submitted any drug candidates for approval by regulatory authorities in the United States or elsewhere. For the year ended December 31, 2025, we incurred a net loss of $33.6 million. We had an accumulated deficit of $206.0 million as of December 31, 2025.

To date, we have devoted most of our financial resources to research and development, including our drug discovery research, preclinical development activities and clinical trial preparation, as well as corporate overhead. We have not generated any revenues from product sales. We expect to continue to incur losses for the foreseeable future, and we expect these losses to increase as we continue our development of, and seek regulatory approvals for Annamycin and our other drug candidates, prepare for and begin the commercialization of any approved products, and add infrastructure and personnel to support our continuing product development efforts. We anticipate that any such losses could be significant for the next several years. If Annamycin, WP1066 or any of our other drug candidates fail in clinical trials or do not gain regulatory approval, or if our drug candidates do not achieve market acceptance, we may never become profitable. As a result of the foregoing, we expect to continue to experience net losses and negative cash flows for the foreseeable future. These net losses and negative cash flows have had, and will continue to have, an adverse effect on our stockholders' equity and working capital.

***Our financial condition would be adversely impacted if our intangible assets become impaired.***

As a result of the accounting for our acquisition of Moleculin, LLC and the agreement we, on Moleculin, LLC's behalf, entered into with Houston Pharmaceuticals, Inc., we have carried on our balance sheet within intangible assets in-process research and development (IPR&D) of $11.1 million as of December 31, 2025. Intangibles are evaluated quarterly and are tested for impairment at least annually or when events or changes in circumstances indicate the carrying value of each segment, and collectively our company taken as a whole, might exceed its fair value.

Intangible assets related to IPR&D are considered indefinite-lived intangible assets and are assessed for impairment annually or more frequently if impairment indicators exist. If the associated research and development effort is abandoned, the related assets will be written-off and we will record a noncash impairment loss on our statement of operations. For those compounds that reach commercialization, if any, the IPR&D assets will be amortized over their estimated useful lives.

If we determine that the value of our intangible assets is less than the amounts reflected on our balance sheet, we will be required to reflect an impairment of our intangible assets in the period in which such determination is made. An impairment of our intangible assets would result in our recognizing an expense in the amount of the impairment in the relevant period, which would also result in the reduction of our intangible assets and a corresponding reduction in our stockholders' equity in the relevant period. As the transactions discussed above were related party transactions and were not conducted on an arm's length basis, it is possible that the terms were less favorable to us than what we would have received in an arm's length transaction.

***We have no sales, marketing or distribution experience and we will have to invest significant resources to develop those capabilities or enter into acceptable third-party sales and marketing arrangements.***

We have no sales, marketing or distribution experience. To develop sales, distribution and marketing capabilities, we will have to invest significant amounts of financial and management resources, some of which will need to be committed prior to any confirmation that Annamycin or any of our other product candidates will be approved by the FDA. For product candidates where we decide to perform sales, marketing and distribution functions ourselves or through third parties, we could face a number of additional risks, including that we or our third-party sales collaborators may not be able to build and maintain an effective marketing or sales force. If we use third parties to market and sell our products, we may have limited or no control over their sales, marketing and distribution activities on which our future revenues may depend.

***We may not be successful in establishing and maintaining development and commercialization collaborations, which could adversely affect our ability to develop certain of our product candidates and our financial condition and operating results.***

Because developing pharmaceutical products, conducting clinical trials, obtaining regulatory approval, establishing manufacturing capabilities and marketing approved products are expensive, we may seek to enter into collaborations with companies that have more experience. Additionally, if any of our product candidates receives marketing approval, we may enter into sales and marketing arrangements with third parties. If we are unable to enter into arrangements on acceptable terms, if at all, we may be unable to effectively market and sell our products in our target markets. We expect to face competition in seeking appropriate collaborators. Moreover, collaboration arrangements are complex and time consuming to negotiate, document and implement and they may require substantial resources to maintain. We may not be successful in our efforts to establish and implement collaborations or other alternative arrangements for the development of our product candidates.

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When we collaborate with a third party for development and commercialization of a product candidate, we can expect to relinquish some or all of the control over the future success of that product candidate to the third party. One or more of our collaboration partners may not devote sufficient resources to the commercialization of our product candidates or may otherwise fail in their commercialization. The terms of any collaboration or other arrangement that we establish may contain provisions that are not favorable to us. In addition, any collaboration that we enter into may be unsuccessful in the development and commercialization of our product candidates. In some cases, we may be responsible for continuing preclinical and initial clinical development of a product candidate or research program under a collaboration arrangement, and the payment we receive from our collaboration partner may be insufficient to cover the cost of this development. If we are unable to reach agreements with suitable collaborators for our product candidates, we would face increased costs, we may be forced to limit the number of our product candidates we can commercially develop or the territories in which we commercialize them. As a result, we might fail to commercialize products or programs for which a suitable collaborator cannot be found. If we fail to achieve successful collaborations, our operating results and financial condition could be materially and adversely affected.

***We face competition from other biotechnology and pharmaceutical companies and our operating results will suffer if we fail to compete effectively.***

The biotechnology and pharmaceutical industries are intensely competitive and subject to rapid and significant technological change. We have competitors in the United States, Europe and other jurisdictions, including major multinational pharmaceutical companies, established biotechnology companies, specialty pharmaceutical and generic drug companies and universities and other research institutions. Many of our competitors have greater financial and other resources, such as larger research and development staff and more experienced marketing and manufacturing organizations than we do. Large pharmaceutical companies, in particular, have extensive experience in clinical testing, obtaining regulatory approvals, recruiting subjects and manufacturing pharmaceutical products. These companies also have significantly greater research, sales and marketing capabilities and collaborative arrangements in our target markets with leading companies and research institutions. Established pharmaceutical companies may also invest heavily to accelerate discovery and development of novel compounds or to in-license novel compounds that could make the product candidates that we develop obsolete. As a result of all of these factors, our competitors may succeed in obtaining patent protection and/or FDA approval or discovering, developing and commercializing drugs for the diseases that we are targeting before we do or may develop drugs that are deemed to be more effective or gain greater market acceptance than ours. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large, established companies. In addition, many universities and private and public research institutes may become active in our target disease areas. Our competitors may succeed in developing, acquiring or licensing on an exclusive basis, technologies and drug products that are more effective or less costly than any of our product candidates that we are currently developing or that we may develop, which could render our products obsolete or noncompetitive.

A number of attempts have been made or are under way to provide an improved treatment for AML. Drugs attempting to target a subset of AML patients who present with particular anomalies involving a gene referred to as FLT3 are currently in clinical trials. Other approaches to improve the effectiveness of induction therapy are in early-stage clinical trials and, although they do not appear to address the underlying problems with anthracyclines, we can provide no assurance that such improvements, if achieved, would not adversely impact the need for improved anthracyclines. A modified version of doxorubicin designed to reduce cardiotoxicity is in clinical trials for the treatment of sarcoma and, although this drug does not appear to address multidrug resistance and is not currently intended for the treatment of acute leukemia, we can provide no assurance that it will not become a competitive alternative to Annamycin. Although we are not aware of any other single agent therapies in clinical trials that would directly compete against Annamycin in the treatment of relapsed and refractory AML, we can provide no assurance that such therapies are not in development, will not receive regulatory approval and will reach market before our drug candidate Annamycin. In addition, any such competing therapy may be more effective and / or cost-effective than ours.

If our competitors market products that are more effective, safer or less expensive or that reach the market sooner than our future products, if any, we may not achieve commercial success. In addition, because of our limited resources, it may be difficult for us to stay abreast of the rapid changes in each technology. If we fail to stay at the forefront of technological change, we may be unable to compete effectively. Technological advances or products developed by our competitors may render our technologies or product candidates obsolete, less competitive or not economical.

***We will need to expand our operations and increase the size of our company, and we may experience difficulties in managing growth.***

As we advance our product candidates through preclinical studies and clinical trials, we will need to increase our product development, scientific and administrative headcount to manage these programs. In addition, to meet our obligations as a public company, we may need to increase our general and administrative capabilities. Our management, personnel, and systems currently in place may not be adequate to support this future growth. If we are unable to successfully manage this growth and increased complexity of operations, our business may be adversely affected.

***We may not be able to manage our business effectively if we are unable to attract and retain key personnel and consultants.***

We may not be able to attract or retain qualified management, finance, scientific and clinical personnel and consultants due to the intense competition for qualified personnel and consultants among biotechnology, pharmaceutical and other businesses. If we are not able to attract and retain necessary personnel and consultants to accomplish our business objectives, we may experience constraints that will significantly impede the achievement of our development objectives, our ability to raise additional capital and our ability to implement our business strategy.

We are highly dependent on the development, regulatory, commercialization and business development expertise of our management team, key employees, and consultants. If we lose one or more of our executive officers or key employees or consultants, our ability to implement our business strategy successfully could be seriously harmed. Any of our executive officers or key employees or consultants may terminate their employment at any time. Replacing executive officers, key employees and consultants may be difficult and may take an extended period of time because of the limited number of individuals in our industry with the breadth of skills and experience required to develop, gain regulatory approval of and commercialize products successfully. Competition to hire and retain employees and consultants from this limited pool is intense, and we may be unable to hire, train, retain or motivate these additional key personnel and consultants. Our failure to retain key personnel or consultants could materially harm our business.

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In addition, we have scientific and clinical advisors and consultants who assist us in formulating our research, development, and clinical strategies. These advisors are not our employees and may have commitments to, or consulting or advisory contracts with, other entities that may limit their availability to us and typically they will not enter into non-compete agreements with us. If a conflict of interest arises between their work for us and their work for another entity, we may lose their services. In addition, our advisors may have arrangements with other companies to assist those companies in developing products or technologies that may compete with ours.

***We do not expect that our insurance policies will cover all of our business exposures thus leaving us exposed to significant uninsured liabilities.***

We do not carry insurance for all categories of risk that our business may encounter. There can be no assurance that we will secure adequate insurance coverage or that any such insurance coverage will be sufficient to protect our operations to significant potential liability in the future. Any significant uninsured liability may require us to pay substantial amounts, which would adversely affect our financial position and results of operations.

Additionally, we use hazardous materials, and any claims relating to improper handling, storage or disposal of these materials could be time-consuming or costly. We do not carry specific hazardous waste insurance coverage and our property and casualty, and general liability insurance policies specifically exclude coverage for damages and fines arising from hazardous waste exposure or contamination.

***We may incur penalties if we fail to comply with healthcare regulations.***

We are exposed to the risk of employee fraud or other illegal activity by our employees, independent contractors, consultants, commercial partners and vendors. In addition to FDA restrictions on the marketing of pharmaceutical products, several other types of state and federal laws have been applied to restrict certain marketing practices in the pharmaceutical and medical device industries in recent years, as well as consulting or other service agreements with physicians or other potential referral sources. These laws include anti-kickback statutes and false claims statutes that prohibit, among other things, knowingly and willfully offering, paying, soliciting or receiving remuneration to induce, or, in return for, purchasing, leasing, ordering or arranging for the purchase, lease or order of any healthcare item or service reimbursable under Medicare, Medicaid or other federally-financed healthcare programs, and knowingly presenting, or causing to be presented, a false claim for payment to the federal government, or knowingly making, or causing to be made, a false statement to get a false claim paid. The majority of states also have statutes or regulations similar to the federal anti-kickback law and false claims laws, which apply to items and services, reimbursed under Medicaid and other state programs, or, in several states, apply regardless of the payer. Although there are a number of statutory exemptions and regulatory safe harbors protecting certain common activities from prosecution, the exemptions and safe harbors are drawn narrowly, and any practices we adopt may not, in all cases, meet all of the criteria for safe harbor protection from anti-kickback liability. Sanctions under these federal and state laws may include civil monetary penalties, exclusion of a manufacturer's products from reimbursement under government programs, criminal fines and imprisonment. Any challenge to our business practices under these laws could have a material adverse effect on our business, financial condition and results of operations.

***We may not be able to recover from any catastrophic event affecting our suppliers.***

Our suppliers may not have adequate measures in place to minimize and recover from catastrophic events that may substantially destroy their capability to meet customer needs, and any measures they may put in place may not be adequate to recover production processes quickly enough to support critical timelines or market demands. These catastrophic events may include weather events such as tornadoes, earthquakes, floods or fires. In addition, these catastrophic events may render some or all of the products at the affected facilities unusable.

***Our business and operations would suffer in the event of third-party computer system failures, cyber-attacks on third-party systems or deficiency in our cyber security.***

We rely on information technology (IT) systems, including third-party "cloud based" service providers, to keep financial records, maintain laboratory data, clinical data, and corporate records, to communicate with staff and external parties and to operate other critical functions. This includes critical systems such as email, other communication tools, electronic document repositories and archives. If any of these third-party information technology providers are compromised due to computer viruses, unauthorized access, malware, natural disasters, fire, terrorism, war and telecommunication failures, electrical failures, cyber-attacks or cyber-intrusions over the internet, then sensitive emails or documents could be exposed or deleted. Similarly, we could incur business disruption if our access to the internet is compromised, and we are unable to connect with third-party IT providers. The risk of a security breach or disruption, particularly through cyber-attacks or cyber intrusion, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. In addition, we rely on those third parties to safeguard important confidential personal data regarding our employees and subjects enrolled in our clinical trials. If a disruption event were to occur and cause interruptions in a third-party IT provider's operation, it could result in a disruption of our drug development programs. For example, the loss of clinical trial data from completed, ongoing or planned clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. To the extent that any disruption or security breach results in a loss of or damage to our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability and development of our product candidates could be delayed or could fail.

***Our failure to comply with data protection laws and regulations could lead to government enforcement actions and significant penalties against us, and adversely impact our operating results.***

We are subject to US data protection laws and regulations (i.e., laws and regulations that address privacy and data security) at both the federal and state levels. The legislative and regulatory landscape for data protection continues to evolve, and in recent years there has been an increasing focus on privacy and data security issues. Numerous federal and state laws, including state data breach notification laws, state health information privacy laws, and federal and state consumer protection laws, govern the collection, use, and disclosure of health-related and other personal information. In addition, we may obtain health information from third parties (e.g., healthcare providers who prescribe our products) that are subject to privacy and security requirements under Health Insurance Portability and Accountability Act of 1996, or HIPAA. Although we are not directly subject to HIPAA-other than potentially with respect to providing certain employee benefits-we could be subject to criminal penalties if we knowingly obtain or disclose individually identifiable health information maintained by a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA. Finally, a data breach affecting sensitive personal information, including health information, could result in significant legal and financial exposure and reputational damages that could potentially have an adverse effect on our business.

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EU Member States, Switzerland and other countries have also adopted data protection laws and regulations, which impose significant compliance obligations. For example, the collection and use of personal health data in the EU is governed by the provisions of the EU Data Protection Directive, which was replaced by the General Data Protection Regulation (GDPR) in 2016 (Directive). The Directive and the national implementing legislation of the EU Member States impose strict obligations and restrictions on the ability to collect, analyze and transfer personal data, including health data from clinical trials and adverse event reporting. In particular, these obligations and restrictions concern the consent of the individuals to whom the personal data relates, the information provided to the individuals, notification of data processing obligations to the competent national data protection authorities and the security and confidentiality of the personal data. Data protection authorities from the different E.U. Member States may interpret the Directive and national laws differently and impose additional requirements, which add to the complexity of processing personal data in the EU.

Guidance on implementation and compliance practices are often updated or otherwise revised. For example, the Directive prohibits the transfer of personal data to countries outside of the European Economic Area, or EEA, that are not considered by the European Commission to provide an adequate level of data protection. These countries include the United States.

The judgment by the Court of Justice of the EU in the Schrems case (Case C-362/14 Maximillian Schrems v. Data Protection Commissioner) determined the US-EU Safe Harbor Framework, which was relied upon by many US entities as a basis for transfer of personal data from the EU to the US, to be invalid. US entities, therefore, had only the possibility to rely on the alternate procedures for such data transfer provided in the EU Data Protection Directive.

On February 29, 2016, however, the European Commission announced an agreement with the US Department of Commerce, or DOC, to replace the invalidated Safe Harbor framework with a new EU-US "Privacy Shield". On July 12, 2016, the European Commission adopted a decision on the adequacy of the protection provided by the Privacy Shield. The Privacy Shield is intended to address the requirements set out by the Court of Justice of the EU in its Schrems judgment by imposing more stringent obligations on companies, providing stronger monitoring and enforcement by the DOC and the Federal Trade Commission, and making commitments on the part of public authorities regarding access to information. US companies have been able to certify to the DOC their compliance with the privacy principles of the Privacy Shield since August 1, 2016, and rely on the Privacy Shield certification to transfer of personal data from the EU to the US.

On September 16, 2016, the Irish privacy advocacy group Digital Rights Ireland brought an action for annulment of the European Commission decision on the adequacy of the Privacy Shield before the Court of Justice of the E.U. (Case T-670/16). Case T-670/16 is still pending. If the Court of Justice of the EU invalidates the Privacy Shield, it will no longer be possible to rely on the Privacy Shield certification to transfer personal data from the EU to entities in the US. Adherence to the Privacy Shield is not, however, mandatory. US-based companies are permitted to rely either on their adherence to the EU-US Privacy Shield or on the other authorized means and procedures to transfer personal data provided by the EU Data Protection Directive.

In addition, the EU Data Protection Regulation, intended to replace the EU Data Protection Directive entered into force on May 24, 2016 and applied from May 25, 2018. The EU Data Protection Regulation introduced new data protection requirements in the E.U. and substantial fines for breaches of the data protection rules. The EU Data Protection Regulation increased our responsibility and liability in relation to personal data that we process, and we may be required to put in place additional mechanisms to ensure compliance with those data protection rules.

Our failure to comply with these laws, or changes in the way in which these laws are implemented, could lead to government enforcement actions and significant penalties against us, and adversely impact our business.

***We depend on our information technology and infrastructure so compromises could materially harm our ability to conduct business or delay our financial reporting.***

We rely on the efficient and uninterrupted operation of information technology systems, including mobile technologies, to manage our operations, to process, transmit and store electronic and financial information, and to comply with regulatory, legal and tax requirements. We also depend on our information technology infrastructure for communications among our personnel, contractors, consultants, and vendors. System failures or outages could compromise our ability to perform these functions in a timely manner, which could harm our ability to conduct business or delay our financial reporting. Such failures could materially adversely affect our operating results and financial condition.

In addition, we depend on third parties to operate and support our information technology systems. These third parties vary from multi-disciplined to boutique providers, and they may or could have access to our computer networks, mobile networks, and our confidential information. Many of these third parties subcontract or outsource some of their responsibilities to other third parties. As a result, our information technology systems, including those functions that are performed by third parties who are involved with or have access to those systems, are very large and complex. Failure by any of these third-party providers to adequately deliver the contracted services, or maintain confidentiality, could have an adverse effect on our business, which in turn may materially adversely affect our operating results and financial condition. All information technology systems, despite implementation of security measures, may be vulnerable to disability, failures, or unauthorized access. If our information technology systems were to fail or be breached, such failure or breach could materially adversely affect our ability to perform critical business functions and sensitive and confidential data could be compromised.

***We may be required to make significant payments under our license agreements with MD Anderson.***

Under our agreements with MD Anderson associated with Annamycin, the WP1122 Portfolio and the WP1066 Portfolio, we are responsible for certain license, milestone and royalty payments over the course of the agreements. Annual license fees can cost as high as $0.1 million depending upon the anniversary, milestone payments for the commencement of phase II and phase III clinical trials can cost as high as $0.5 million. Other milestone payments for submission of an NDA to the FDA and receipt of first marketing approval for sale of a license product can be as high as $0.6 million. Royalty payments can range in the single digits as a percent of net sales on drug products or flat fees as high as $0.6 million, depending upon certain terms and conditions. If these milestone or other non-royalty obligations become due, we may not have sufficient funds available to meet our obligations. If we fail to meet our payment obligations, our license agreements could be terminated, which would materially and adversely affect our business operations and financial condition.

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***New tax laws or regulations that are enacted or existing tax laws and regulations that are interpreted, modified or applied adversely to us or our customers may have a material adverse effect on our business and financial condition.***

New tax laws or regulations could be enacted at any time, and existing tax laws or regulations could be interpreted, modified or applied in a manner that is adverse to us or our customers, which could adversely affect our business and financial condition. For example, the Tax Cuts and Jobs Act, the Coronavirus Aid, Relief, and Economic Security Act and the Inflation Reduction Act enacted many significant changes to the U.S. tax laws. Future guidance from the Internal Revenue Service and other tax authorities with respect to such legislation may affect us, and certain aspects of such legislation could be repealed or modified in future legislation. In addition, it is uncertain if and to what extent various states will conform to federal tax laws. Any future tax legislation could increase our U.S. tax expense and could have a material adverse impact on our business and financial condition.

***We must comply with indirect tax laws in multiple jurisdictions, as well as complex customs duty regimes worldwide. Audits of our compliance with these rules may result in additional liabilities for taxes, duties, interest and penalties related to our international operations which would reduce our profitability.***

Our operations may be subject to audit by tax authorities in various countries. Many countries have indirect tax systems where the sale and purchase of goods and services are subject to tax based on the transaction value. These taxes are commonly referred to as value-added tax ("VAT") or goods and services tax ("GST"). In addition, the distribution of our products subjects us to numerous complex customs regulations, which frequently change over time. Failure to comply with these systems and regulations can result in the assessment of additional taxes, duties, interest, and penalties. While we believe we are in compliance with local laws, we cannot assure that tax and customs authorities will agree with our reporting positions and upon audit such tax and customs authorities may assess additional taxes, duties, interest, and penalties against us. Adverse action by any government agencies related to indirect tax laws could materially and adversely affect our business, results of operations and financial condition.

***Errors in our assumptions, estimates and judgments related to tax matters, including those resulting from regulatory reviews, could adversely affect our financial results.***

We may be subject to routine tax audits on various tax matters around the world in the ordinary course of business (including income tax, business tax, customs duties, sales and use tax, and value added tax ("VAT") matters). We regularly assess the adequacy of our uncertain income tax positions and other reserves, which requires a significant amount of judgment. Although we may accrue for uncertain income tax positions and other regulatory audits, negotiations with taxing and customs authorities may lead to adjustments in excess of our accruals, resulting in liabilities for additional taxes, duties, penalties and interest.

***We will require significant additional funding to complete the MIRACLE trial, which may not be available to us on acceptable terms, or at all, and, if not so available, may require us to delay, limit, reduce or cease our operations.***

We have used and we intend to use our current cash resources and the proceeds from any possible future offerings, to, among other uses, advance our portfolio through preclinical studies and into INDs or their equivalent, and sponsoring research at MD Anderson and HPI. Developing pharmaceutical products, including conducting preclinical studies and clinical trials, is expensive. We estimate that with our current cash on hand as of December 31, 2024, plus cash raised in the first quarter of 2025, will support our MIRACLE trial and our operations into the third quarter of 2025. As such, based on our current cash, in order to fund our operations beyond the near term, including MIRACLE, we will need to raise significant financing for which we have no commitments. If the FDA or its EU equivalent requires that we perform additional nonclinical studies or clinical trials, our expenses would further increase beyond what we currently expect and the anticipated timing of any potential approval of Annamycin would likely be delayed. Further, there can be no assurance that the costs we will need to incur to obtain regulatory approval of Annamycin will not increase.

**Risks Relating to Our Common Stock**

***Our stock price has been and may continue to be volatile, which could result in substantial losses for investors.***

Over the past two years, our stock price has ranged from a high of $356.19 to a low of $3.31 (taking into account the reverse stock splits we have completed), and the market price of our common stock is likely to continue to be highly volatile and could fluctuate widely in response to various factors, many of which are beyond our control. In addition, the securities markets have from time-to-time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies. These market fluctuations may also significantly affect the market price of our common stock.

***Shares issuable upon the exercise of outstanding options or warrants may substantially increase the number of shares available for sale in the public market and depress the price of our common stock.***

As of December 31, 2025 and February 28, 2026, we had outstanding warrants and options to purchase an aggregate of 7,868,686 and 12,719,348 shares of common stock, respectively, at weighted average exercise prices of $6.36 and $4.11 per share, respectively, in each case after giving effect to the reverse stock splits we completed. To the extent any of these options or warrants are exercised and any additional options or warrants are granted and exercised, there will be further dilution to stockholders and investors. Until the options and warrants expire, these holders will have an opportunity to profit from any increase in the market price of our common stock without assuming the risks of ownership. Holders of options and warrants may convert or exercise these securities at a time when we could obtain additional capital on terms more favorable than those provided by the options or warrants. The exercise of the options and warrants will dilute the voting interest of the owners of presently outstanding shares by adding a substantial number of additional shares of our common stock.

***As a biotechnology company, we are at increased risk of securities class action litigation.***

Biotechnology companies have experienced greater than average stock price volatility in recent years, and our common stock price has been particularly volatile ranging from a high of $356.19 to a low of $3.31 over the past two years (taking into account the reverse stock splits we have completed). These broad market fluctuations may adversely affect the trading price or liquidity of our common stock. In the past, when the market price of a stock has been volatile, holders of that stock have sometimes instituted securities class action litigation against the issuer. If any of our stockholders were to bring such a lawsuit against us, we could incur substantial costs defending the lawsuit and the attention of management would be diverted from the operation of our business.

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***If we are unable to maintain compliance with the listing requirements of The Nasdaq Capital Market, our common stock may be delisted from The Nasdaq Capital Market which could have a material adverse effect on our financial condition and could make it more difficult for you to sell your shares.***

Our common stock is listed on The Nasdaq Capital Market, and we are therefore subject to its continued listing requirements, including requirements with respect to the market value of publicly held shares, market value of listed shares, minimum bid price per share, and minimum stockholder's equity, among others, and requirements relating to board and committee independence. If we fail to satisfy one or more of the requirements, we may be delisted from The Nasdaq Capital Market.

We have in the past, and we may again in the future, fail to comply with the continued listing requirements of the Nasdaq Capital Market, which would subject our common stock to being delisted. Delisting from The Nasdaq Capital Market would adversely affect our ability to raise additional financing through the public or private sale of equity securities, may significantly affect the ability of investors to trade our securities and may negatively affect the value and liquidity of our common stock. Delisting also could have other negative results, including the potential loss of employee confidence, the loss of institutional investors or interest in business development opportunities.

As previously disclosed, in July 2025, we received notice from Nasdaq that, because the closing bid price for our common stock had fallen below $1.00 per share for 30 consecutive trading days, we no longer complied with the minimum bid price requirement for continued listing on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2). In December 2025, we effected a reverse stock split of our common stock on a one-for-25 basis, and subsequently regained compliance with Nasdaq's minimum bid price requirement. However, there is no assurance that we will be able to maintain compliance with the minimum bid price requirement or other applicable Nasdaq listing rules. Moreover, if we fall out of compliance with the minimum bid price requirement within one year of effecting the reverse stock split, a grace period will not be provided to cure the deficiency and Nasdaq will provide notice that our common stock will be subject to delisting.

***Failure to maintain our accounting systems and controls could impair our ability to comply with the financial reporting and internal controls requirements for publicly traded companies.***

As a public company, we operate in an increasingly demanding regulatory environment, which requires us to comply with the Sarbanes-Oxley Act of 2002, and the related rules and regulations of the SEC. Company responsibilities required by the Sarbanes-Oxley Act include establishing corporate oversight and adequate internal control over financial reporting and disclosure controls and procedures. Effective internal controls are necessary for us to produce reliable financial reports and are important to help prevent financial fraud.

Because we are a smaller reporting company and a non-accelerated filer, we are not required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act. However, we must perform system and process evaluation and testing of our internal control over financial reporting to allow management to report on the effectiveness of our internal control over financial reporting in this report and future annual reports on Form 10-K, as required by Section 404 of the Sarbanes-Oxley Act. This requires that we incur substantial additional professional fees and internal costs to expand our accounting and finance functions and that we expend significant management efforts.

We have in the past, and may in the future, discover weaknesses in our system of internal financial and accounting controls and procedures that could result in a material misstatement of our financial statements. Our internal control over financial reporting will not prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system's objectives will be met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud will be detected.

If we are not able to comply with the requirements of Section 404 of the Sarbanes-Oxley Act, or if we are unable to maintain proper and effective internal controls, we may not be able to produce timely and accurate financial statements. If we cannot provide reliable financial reports or prevent fraud, our business and results of operations could be harmed, and investors could lose confidence in our reported financial information.

***Unstable market and economic conditions may have serious adverse consequences on our business, financial condition and stock price.***

The global financial markets have recently experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates and uncertainty about economic stability. The financial markets, energy prices, and the global economy may also be adversely affected by the current or anticipated impact of military conflict, including the conflicts in Ukraine and the Middle East, terrorism or other geopolitical events. Sanctions imposed by the United States and other countries in response to such conflicts, including the one in Ukraine, may also adversely impact the financial markets, energy prices, and the global economy, and any economic countermeasures by affected countries and others could exacerbate market and economic instability. We currently source the API for our lead product candidate, Annamycin, from a supplier in Europe and increased energy prices in the region may result in increased costs to us for such API. There can be no assurance that further deterioration in credit and financial markets and confidence in economic conditions will not occur. Our general business strategy may be adversely affected by any such economic downturn, volatile business environment or continued unpredictable and unstable market conditions. If the current equity and credit markets deteriorate, it may make any necessary debt or equity financing more difficult, more costly and more dilutive. Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance and stock price and could require us to delay or abandon clinical development plans. In addition, there is a risk that one or more of our current service providers, manufacturers and other partners may not survive an economic downturn, which could directly affect our ability to operate. On March 10, 2023, the Federal Deposit Insurance Corporation, or the FDIC, took control and was appointed receiver of Silicon Valley Bank, or SVB. We have no exposure to SVB. If other banks and financial institutions enter receivership or become insolvent in the future in response to financial conditions affecting the banking system and financial markets, our ability to access our existing cash, cash equivalents and investments may be threatened and could have a material adverse effect on our business and financial condition.

***We cannot predict the effect that our reverse stock split will have on the market price for shares of our common stock.***

On December 1, 2025, we effected a 1-for-25 reverse stock split of our common stock pursuant to authority granted by our stockholders.

We cannot predict the effect that the reverse stock split will have on the market price for shares of our common stock, and the history of similar reverse stock splits for companies in like circumstances has varied. Some investors may have a negative view of a reverse stock split. Even if the reverse stock split has a positive effect on the market price for shares of our common stock, performance of our business and financial results, general economic conditions and the market perception of our business, and other adverse factors which may not be in our control could lead to a decrease in the price of our common stock following the reverse stock split.

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Even if the reverse stock split does result in an increased market price per share of our common stock, the market price per share following the reverse stock split may not increase in proportion to the reduction of the number of shares of our common stock outstanding before the implementation of the reverse stock split. Accordingly, even with an increased market price per share, the total market capitalization of shares of our common stock after the reverse stock split could be lower than the total market capitalization before the reverse stock split. Also, even if there is an initial increase in the market price per share of our common stock after the reverse stock split, the market price may not remain at that level.

If the market price of shares of our common stock declines following the reverse stock split, the percentage decline as an absolute number and as a percentage of our overall market capitalization may be greater than would occur in the absence of the reverse stock split due to decreased liquidity in the market for our common stock. Accordingly, the total market capitalization of our common stock following the reverse stock split could be lower than the total market capitalization before the reverse stock split.

***There are provisions in certain of our outstanding warrants that could discourage an acquisition of us by a third party.***

Certain of our outstanding warrants provide that in the event of a "Fundamental Transaction" (as defined in the related warrant agreement, which generally includes any merger with another entity, the sale, transfer or other disposition of all or substantially all of our assets to another entity, or the acquisition by a person of more than 50% of our common stock), each warrant holder will have the right at any time prior to the consummation of the Fundamental Transaction to require us to repurchase the common warrant for a purchase price in cash equal to the Black-Scholes value (as calculated under the warrant agreement) of the then remaining unexercised portion of such warrant on the date of such Fundamental Transaction, which may materially adversely affect our financial condition and/or results of operations and may prevent or deter a third party from acquiring us.

***If our estimates or judgments relating to our critical accounting policies prove to be incorrect, or if financial reporting standards or interpretations change, our results of operations could be adversely affected.***

The preparation of our consolidated financial statements in conformity with U.S. generally accepted accounting principles (US GAAP) requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates and assumptions are based on historical experience, known trends and events, and various other factors that we believe to be reasonable under the circumstances. Certain of our accounting policies require the use of significant management judgment and estimates. For example, the fair value of our warrant liabilities is estimated using option-pricing models that require assumptions regarding expected volatility, expected term, the risk-free interest rate and the market price of our common stock. Changes in these assumptions or in underlying market conditions could materially affect the valuation of our warrants and our results of operations. In addition, changes in these assumptions or in the market price of our common stock may result in significant non-cash gains or losses in our consolidated statements of operations in future periods, which could cause our reported results of operations to fluctuate significantly from period to period. Because these estimates and assumptions are inherently uncertain, actual results could differ materially from our estimates. If our assumptions change or actual circumstances differ from those underlying our estimates, our results of operations could be adversely affected and could fall below the expectations of securities analysts or investors, which could result in a decline in the trading price of our common stock. In addition, we regularly monitor our compliance with applicable financial reporting standards and review new accounting pronouncements and interpretations that are relevant to our business. As a result of new standards, changes to existing standards, or changes in their interpretation, we may be required to change our accounting policies, modify our operational processes, or implement new or enhanced financial reporting systems. In certain circumstances, such changes could require us to restate previously issued financial statements. Any such changes could adversely affect our reputation, business, financial condition and results of operations.

**General Risks**

***Your ownership may be diluted if additional capital stock is issued to raise capital, to finance acquisitions or in connection with strategic transactions.***

We intend to seek to raise additional funds, finance acquisitions or develop strategic relationships by issuing equity or convertible debt securities, which would reduce the percentage ownership of our existing stockholders. Our board of directors has the authority, without action or vote of the stockholders, to issue all or any part of our authorized but unissued shares of common or preferred stock. Our certificate of incorporation authorizes us to issue up to 500,000,000 shares of common stock and 5,000,000 shares of preferred stock. Future issuances of common or preferred stock would reduce your influence over matters on which stockholders vote and would be dilutive to earnings per share. In addition, any newly issued preferred stock could have rights, preferences and privileges senior to those of the common stock. Those rights, preferences and privileges could include, among other things, the establishment of dividends that must be paid prior to declaring or paying dividends or other distributions to holders of our common stock or providing for preferential liquidation rights. These rights, preferences and privileges could negatively affect the rights of holders of our common stock, and the right to convert such preferred stock into shares of our common stock at a rate or price that would have a dilutive effect on the outstanding shares of our common stock.

***Negative research about our business published by analysts or journalists could cause our stock price to decline. A lack of regularly published research about our business could cause trading volume or our stock price to decline.***

The trading market for our common stock depends in part on the research and reports that analysts and journalists publish about us or our business. If analysts or journalists publish inaccurate or unfavorable research about our business, our stock price would likely decline. If we fail to meet the expectations of analysts for our operating results, or if the analysts who covers us downgrade our stock, our stock price would likely decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, demand for our stock could decrease, which could cause our stock price and trading volume to decline.

***Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us.***

Our certificate of incorporation and bylaws contain provisions that eliminate, to the maximum extent permitted by the General Corporation Law of the State of Delaware, or DGCL, the personal liability of our directors and executive officers for monetary damages for breach of their fiduciary duties as a director or officer. Our certificate of incorporation and bylaws also provide that we will indemnify our directors and executive officers and may indemnify our employees and other agents to the fullest extent permitted by the DGCL. Any claims for indemnification made by our directors or officers could impact our cash resources and our ability to fund the business.

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***We have no intention of declaring dividends in the foreseeable future.***

The decision to pay cash dividends on our common stock rests with our board of directors and will depend on our earnings, unencumbered cash, capital requirements and financial condition. We do not anticipate declaring any dividends in the foreseeable future, as we intend to use any excess cash to fund our operations. Investors in our common stock should not expect to receive dividend income on their investment, and investors will be dependent on the appreciation of our common stock to earn a return on their investment.

***Artificial intelligence presents risks and challenges that can impact our business, including by posing security risks to our confidential information, proprietary information and personal data*.***

Issues in the development and use of artificial intelligence, combined with an uncertain regulatory environment, may result in reputational harm, liability, or other adverse consequences to our business operations. As with many technological innovations, artificial intelligence presents risks and challenges that could impact our business. We may adopt and integrate generative artificial intelligence tools into our systems for specific use cases reviewed by legal and information security. Our vendors may incorporate generative artificial intelligence tools into their offerings without disclosing this use to us, and the providers of these generative artificial intelligence tools may not meet existing or rapidly evolving regulatory or industry standards with respect to privacy and data protection and may inhibit our or our vendors' ability to maintain an adequate level of service and experience. If we, our vendors, or our third-party partners experience an actual or perceived breach or privacy or security incident because of the use of generative artificial intelligence, we may lose valuable intellectual property and confidential information and our reputation and the public perception of the effectiveness of our security measures could be harmed. Further, bad actors around the world use increasingly sophisticated methods, including the use of artificial intelligence, to engage in illegal activities involving the theft and misuse of personal information, confidential information, and intellectual property. Any of these outcomes could damage our reputation, result in the loss of valuable property and information, and adversely impact our business.

***Certain provisions in our organizational documents could enable our board of directors to prevent or delay a change of control.***

Our organizational documents contain provisions that may have the effect of discouraging, delaying or preventing a change of control of, or unsolicited acquisition proposals, that a stockholder might consider favorable. These include provisions:

• prohibiting the stockholders from acting by written consent;

• requiring advance notice of director nominations and of business to be brought before a meeting of stockholders;

• requiring a majority vote of the outstanding shares of common stock to amend the bylaws; and

• limiting the persons who may call special stockholders' meetings.

Furthermore, our board of directors has the authority to issue shares of preferred stock in one or more series and to fix the rights and preferences of these shares without stockholder approval. Any series of preferred stock is likely to be senior to our common stock with respect to dividends, liquidation rights and, possibly, voting rights. The ability of our board of directors to issue preferred stock also could have the effect of discouraging unsolicited acquisition proposals, thus adversely affecting the market price of our common stock.

In addition, Delaware law makes it difficult for stockholders that recently have acquired a large interest in a corporation to cause the merger or acquisition of the corporation against the directors' wishes. Under Section 203 of the Delaware General Corporation Law, a Delaware corporation may not engage in any merger or other business combination with an interested stockholder for a period of three years following the date that the stockholder became an interested stockholder except in limited circumstances, including by approval of the corporation's board of directors.

***Shareholder activism could cause material disruption to our business.***

Publicly traded companies have increasingly become subject to campaigns by activist investors advocating corporate actions such as actions related to environment, social and governance (ESG) matters, among other issues. Responding to proxy contests and other actions by such activist investors or others in the future could be costly and time-consuming, disrupt our operations and divert the attention of our Board of Directors and senior management from the pursuit of our business strategies, which could adversely affect our results of operations and financial condition.

***We will require additional financing in the near term, which financing may result in the reduction of the exercise price of certain of our warrants, which would dilute the ownership interest of our stockholders.***

Developing pharmaceutical products, including conducting preclinical studies and clinical trials, is expensive. We will require substantial additional future capital in order to complete clinical development and commercialize Annamycin.

Certain of our warrants provide that if, while such warrants are outstanding, we sell any common stock and/or common stock equivalents other than in connection with certain exempt issuances, at a purchase price per share less than the exercise price of the warrants in effect immediately prior to such sale, then immediately after such sale the exercise price of the such warrants then in effect will be reduced to an amount equal to the new issuance price.

**ITEM 1B. UNRESOLVED STAFF COMMENTS**

None.

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**ITEM 1C. CYBERSECURITY**

***Risk Management and Strategy***

We have established policies and procedures for assessing, identifying, and managing material risk from cybersecurity threats, and have integrated these processes into our overall risk management systems and processes. We monitor cybersecurity threats, including any potential unauthorized occurrence on or conducted through our information systems that we use through third party providers that may result in adverse effects on the confidentiality, integrity, or availability of our information systems or any information residing therein.

We conduct annual risk assessments and perform as needed updates to our risks to identify cybersecurity threats, as well as assessments in the event of a material change in our business practices that *may* affect information systems that are vulnerable to such cybersecurity threats. We engage consultants, third parties and auditors in connection with our risk assessment processes. These service providers assist us in designing and implementing our cybersecurity policies and procedures, as well as monitoring and testing our safeguards. Personnel at all levels and departments are made aware of our cybersecurity policies through periodic training and communications.

As of December 31, 2025, and through the date of the filing of this report, we are not aware of any cybersecurity incidents that have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations or financial condition. For additional information regarding risks from cybersecurity threats, please refer to Item 1A, "Risk Factors," in this Annual report on Form 10-K.

***Governance***

One of the key responsibilities of our board of directors is informed oversight of our risk management process, including risks from cybersecurity threats. Our board of directors is responsible for monitoring and assessing strategic risk exposure, and our executive officers are responsible for the day-to-day management of the material risks we face. Our board of directors administers its cybersecurity risk oversight function through the audit committee, which provides oversight of our cybersecurity program as part of its periodic review of overall risk management program.

Our Chief Financial Officer and Head of IT and Cybersecurity, a consultant, are primarily responsible for assessing and managing our material risks from cybersecurity threats. In this regard, our Chief Financial Officer and Head of IT and Cybersecurity have assistance from service providers, other consultants and third parties. Our Chief Financial Officer has served as an executive officer for over twenty-six years, including over sixteen years as an executive officer of public companies. Our Head of IT and Cybersecurity has served as an information technology professional for over ten years and has held senior IT positions at multiple companies, where his primary responsibilities included maintaining direct oversight over his companies' cybersecurity risks.

Our Chief Financial Officer and Head of IT and Cybersecurity oversee our cybersecurity policies and procedures, including those described in "Risk Management and Strategy" above. Under such policies and procedures, our Chief Financial Officer and Head of IT and Cybersecurity are responsible for reporting to our audit committee regarding any cybersecurity incidents. The audit committee, in turn, provides periodic reports to our board of directors regarding our cybersecurity processes, including the results of cybersecurity risk assessments.

**ITEM 2. PROPERTIES**

Our corporate executive offices, laboratory and other spaces are located in leased facilities in Houston, Texas. In March 2018, we entered into a Lease Agreement (the "Lease") which we use for corporate office space and headquarters. The term of the Lease began in August 2018 and had an initial term of 66 months, which had a renewal option for an additional 5 years. In September 2023, the Company executed an amendment to extend the corporate office lease until August 31, 2029, with an option to renew. The Company is required to remit base monthly rent of approximately $4,700 which will increase at an average approximate rate of 2% each year. The Company is also required to pay additional rent in the form of its pro-rata share of certain specified operating expenses of the building.

In June 2022, we entered into a Second Amendment to our Lab Lease Agreement. The term of the Lease will continue through September 30, 2027, with no further right or option to renew. We are required to remit base monthly rent which will increase at an average approximate rate of 3% each year. In August 2019, we entered into a sublease (which was extended in 2022 in connection with the lease extension) with Houston Pharmaceuticals, Inc. (HPI), which is affiliated with Dr. Priebe. We granted HPI access to all of the Lab Lease space and HPI has agreed to pay us 50% of the rent payable under the Lab Lease less 50% of any benefits from any sublease or other lab service agreement we may receive from the Lab Lease. Although HPI has access to the space, it is the intent of the parties that they equally share the Lab Lease space for research purposes. We believe our facilities, as expanded, will be sufficient to meet our current needs and that suitable space will be available as and when needed. We do not own any real property.

**ITEM 3. LEGAL PROCEEDINGS**

From time to time in the ordinary course of our business, we may be involved in legal proceedings, the outcomes of which may not be determinable. The results of litigation are inherently unpredictable. Any claims against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time and result in diversion of significant resources. We are not able to estimate an aggregate amount or range of reasonably possible losses for those legal matters for which losses are not probable and estimable, primarily for the following reasons: (i) many of the relevant legal proceedings are in preliminary stages, and until such proceedings develop further, there is often uncertainty regarding the relevant facts and circumstances at issue and potential liability; and (ii) many of these proceedings involve matters of which the outcomes are inherently difficult to predict. We have insurance policies covering potential losses where such coverage is cost effective.

We are not at this time involved in any legal proceedings that we believe could have a material effect on our business, financial condition, results of operations or cash flows.

**ITEM 4. MINE SAFETY DISCLOSURE**

Not applicable.

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**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 under the symbol "MBRX".

**Holders**

As of March 11, 2026, there were approximately 316 holders of record of our common stock. In addition, we believe that a significant number of beneficial owners of our common stock hold their shares in nominee or in "street name" accounts through brokers.

**Dividends**

We have never paid any dividends on our common stock. The payment of dividends in the future will be contingent upon our revenues and earnings, if any, capital requirements and general financial condition. It is the present intention of our Board of Directors to retain all earnings, if any, for use in our business operations and, accordingly, our Board of Directors does not anticipate declaring any dividends in the foreseeable future.

**Recent Sales of Unregistered Securities** 

All information related to equity securities sold by us during the period covered by this report that were not registered under the Securities Act have been included in our Form 10-Q filings or in a Form 8-K filing.

**Purchases of Equity Securities by the Issuer and Affiliated Purchasers**

We did not repurchase any of our equity securities during the year ended December 31, 2025.

**ITEM 6. [RESERVED]**

**ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

*The following discussion should be read in conjunction with the Financial Statements and Notes thereto included in this Form 10-K. The forward-looking statements included in this discussion and elsewhere in this Form 10-K involve risks and uncertainties, including those set forth under "Cautionary Statement About Forward-Looking Statements." Actual results and experience could differ materially from the anticipated results and other expectations expressed in our forward-looking statements as a result of a number of factors, including but not limited to those discussed in this Item and in Item 1A - "Risk Factors."*

<u>Our Business Summary</u>

We are a late-stage pharmaceutical development company currently evaluating Annamycin, also known as L-Annamycin and by its generic name "naxtarubicin", which we believe is a "next-generation" anthracycline and, with it, are conducting a pivotal Phase 3 trial in combination with cytarabine for the treatment of subjects with relapsed/refractory (R/R) acute myeloid leukemia (AML). We call this the "MIRACLE" trial (derived from Moleculin R/R AML AnnAraC Clinical Evaluation). A blinded preliminary data readout has already been released for the MIRACLE trial, and we expect to have an interim unblinding of data in mid-2026 and an additional unblinding in the second half of 2026, thereby concluding Part A of the two-part trial. We believe such early visibility for a pivotal registration-enabling trial is unique in that stakeholders will receive preliminary safety and efficacy data long before the conclusion of the trial.

We have two additional portfolios of technologies for hard-to-treat cancers and viruses with clinical and preclinical research funded by investigators at academic institutions. One of these portfolios has an ongoing investigator-initiated trial, another one planned and additional active preclinical testing. Since our inception, drug candidates from each of the three core portfolios are in active planning for, have approval to begin, are currently in or have successfully completed eighteen clinical trials.

Each of our three core technologies is based substantially on discoveries made at, made in conjunction with, and/or licensed from the University of Texas MD Anderson Cancer Center (MD Anderson) in Houston, Texas. For each of the core technologies, one or more drug candidates have successfully completed a Phase 1 or greater clinical trial. Three of our drug candidates have shown human activity in clinical trials and are currently or have been in Phase 1B/2, Phase 2, Phase 2B/3 clinical trials. One of those drug candidates is Annamycin, which is currently in the MIRACLE trial.

We believe Annamycin is the first of its kind DNA binding agent, a "next-generation" anthracycline. Whereas first- and second-generation anthracyclines are currently used to treat approximately half of all cancers, they carry with them the burden of dangerous cardiotoxicity and efficacy limitations associated with multidrug resistance mechanisms and poor tissue/organ distribution. Later generation anthracyclines are comprised mainly of attempts to reduce cardiotoxicity or enhance anticancer activity but we believe have failed to deliver the necessary safety and efficacy profiles to win approval or gain market acceptance. Annamycin is an entirely new chemical entity integrating a new molecular structure intended to enhance its ability to selectively kill cancer cells and reduce toxic side effects. Annamycin possesses a unique and innovative multilamellar lipid-based delivery system designed to improve bioavailability and to increase therapeutic window. The result is a next-generation anthracycline that we believe effectively addresses critical problems associated with currently used anthracyclines. It is our lead drug candidate, and we have concluded a Phase 1B/2 clinical trial for treating AML and are now conducting a Phase 3 clinical trial for R/R AML, which we believe will be registration enabling. We have also sponsored two Phase 1B/2 clinical trials of Annamycin for treating Soft Tissue Sarcoma metastasized to the lungs (STS lung metastases, STS lung mets, or Advanced STS), the results of which we believe supports the initiation of a pivotal approval trial in this additional indication.

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We believe that our lead drug candidate Annamycin has:

● The following advantages over early-generation anthracyclines which in their totality support Annamycin's classification as a "next-generation" anthracycline: 1) demonstrated across five clinical trials to be non-cardiotoxic (n=90) with some patients being safely dosed at five times the typical lifetime maximum allowable anthracycline dose, (which potentially enables repeated dosing, consolidation and even use as a maintenance therapy); 2) exhibits no vesicant activity as well as greater tolerability, making it safer to handle and administer and easier on patients; 3) shown in preclinical models to circumvent multidrug resistance by avoiding MDR1 mechanisms and also to avoid cross-resistance with some of the most commonly used drugs for the treatment of AML (as well as many other cancers), including currently approved early-generation anthracyclines, cytarabine and venetoclax and, 4) exhibited in preclinical models substantially improved tissue/organ distribution;

● Demonstrated a complete remission (CR) rate of 50% and a composite complete remission (CRc) rate of 60% in combination with Cytarabine for the treatment of R/R AML as second line therapy (n=10). On an all comer's basis (no limit on prior lines of therapy), the population of subjects who achieved a CR (n=8) demonstrated durability of approximately 13 months with median overall survival of 15 months and developing at the time of analysis, with 4 of 8 subjects (50%) censored;

● Shown promising blinded safety and efficacy data for the first 30 subjects treated in the MIRACLE trial as we head towards the planned interim unblinding of data for the first 45 subjects treated with efficacy data in Part A of the MIRACLE trial in mid-2026;

● Shown encouraging activity in a total of five different clinical trials (most of which are now complete), funded both internally and externally (through investigator-initiated trials); specifically including relapsed and refractory AML with complete remission rates significantly above currently approved second line therapies and STS lung mets with overall survival as a median seventh line therapy comparable to overall survival seen with approved first line monotherapies; and

● Obtained composition of matter patent protection through 2040 with the potential to extend as far as 2045 as well as Orphan Drug and Fast Track designation.

One of our core management beliefs is that anthracyclines represent one of the most important treatments available for AML and Advanced STS, as well as many other cancers, and we believe Annamycin may, for the first time ever, allow a majority of these patients to benefit from Annamycin's improved safety and efficacy by allowing increased dosing (and even maintenance dosing), improved tolerability and allowing access for patients who otherwise would not be eligible for an anthracycline (including the elderly and those with impaired cardiac function). We believe that such benefits will be disruptive to the competitive landscape for these markets. This belief, coupled with our limited resources, leads us to currently focus mainly on the development of Annamycin. We seek to advance our other drug candidates via investigator led studies, both clinically and preclinically, and as available resources will allow.

<u>Core Technologies and Focus</u>

Our core technologies consist of the following programs:

a) Annamycin is what we believe to be a "next-generation" anthracycline (one of the most widely used classes of chemotherapy), designed to be different than currently approved anthracyclines, which are limited in utility because of cardiotoxicity risks, tolerability, their susceptibility to multidrug resistance mechanisms and a lack of efficacy in certain tumor models.

b) Our WP1066 Portfolio includes WP1066, WP1193 and WP1220, three of several Immune/Transcription Modulators in the portfolio designed to inhibit p-STAT3 (phosphorylated signal transducer and activator of transcription) among other transcription factors associated with tumor activity. These also stimulate a natural immune response to tumors by inhibiting the errant activity of Regulatory T-Cells (TRegs).

c) Our WP1122 Portfolio contains compounds (including WP1122, WP1096, and WP1097) designed to exploit the potential uses of inhibitors of glycolysis such as 2-deoxy-D-glucose (2-DG). We believe such compounds may provide an opportunity to cut off the energy supply of tumors by taking advantage of their high degree of dependence on glucose in comparison to healthy cells, as well as viruses that also depend upon glycolysis and glycosylation to infect and replicate.

<u>Our Current Clinical Trial Focus</u>

We are focused on Annamycin and WP1066 program's internally and externally funded ("internally" and "externally" funded trials are defined in the Funding Strategy section below) development of our core technologies as follows:

1. Annamycin:

a. Internally funded – In combination with Cytarabine (also known as Ara-C, the combination with Annamycin of which is referred to as AnnAraC) for the treatment of R/R AML, and

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| |
|:---|
| b. |
| c. Externally funded – Based on sponsored research, we intend to begin in 2026 a Phase 1B/2 clinical trial with Annamycin as a monotherapy treating 3<sup>rd</sup> line pancreatic cancer. |
| d. Internally funded – MB-109 utilizing AnnAraC for R/R AML as 3<sup>rd</sup> line therapy in adults is planned for 2027. |
| e. Externally funded – MB-110 utilizing AnnAraC for R/R AML as 2<sup>nd</sup> line therapy in pediatrics is planned for 2027. We are researching potential sites for a grant funded trial. |

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2. WP1066:

a. Externally funded - An improved formulation for delivery intravenously (IV) of a molecule from the WP1066 portfolio to possibly further support future externally funded oncology clinical trials. Such a formulation requires additional preclinical work prior to a clinical trial.

b. Externally funded - Phase 1B/2 trial for WP1066 oral formulation in combination with radiation treating glioblastoma (GBM) both in adults and pediatrics. An adult clinical trial is in process and a pediatric trial is in the planning stage.

We have established a Recommended Phase 2 Dose for WP1122 to potentially enable future externally funded oncology and virology trials. Beyond this, we support development of our core technologies through sponsored (internally funded) non-clinical research at MD Anderson.

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**Moleculin Biotech, Inc.** 

**Results of Operations for the Year Ended December 31, 2025 as Compared to the Year Ended December 31, 2024**

The following table is data derived from the Consolidated Statement of Operations (in thousands) and the discussions that follow are in approximate amounts:

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| | | |
|:---|:---|:---|
|  | **Year ended December 31,** | **Year ended December 31,** |
|  | **2025** | **2024** |
| Revenue | $— | $— |
| Operating expenses: |  |  |
| Research and development | 15891 | 17729 |
| General and administrative | 9122 | 8786 |
| Depreciation and amortization | 90 | 126 |
| Total operating expense | 25103 | 26641 |
| Loss from operations | (25103) | (26641) |
| Other income: |  |  |
| Gain from change in fair value of warrant liabilities | 24441 |  |
| &nbsp;&nbsp;&nbsp; Loss on issuance of warrant liabilities | (30962) |  |
| &nbsp;&nbsp;&nbsp; Transaction costs allocated to warrant liabilities | (1407) |  |
| &nbsp;&nbsp;&nbsp; Loss on extinguishment of warrant liabilities | (614) |  |
| Other (expense) income, net | (20) | 43 |
| Interest income, net | 105 | 550 |
| Net loss | $(33560) | $(26048) |

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**Research and Development Expense** 

Research and development (R&D) expense was $15.9 million and $17.7 million for the years ended December 31, 2025 and 2024, respectively. The decrease in R&D of $1.8 million is primarily attributable to a reduction in sponsored research activities during the current year compared to the prior year.

**General and Administrative Expense** 

General and administrative (G&A) expense was $9.1 million and $8.8 million for the years ended December 31, 2025 and 2024, respectively. The increase in G&A of $0.3 million was primarily attributable to higher regulatory and legal services, as well as increased consulting and investor relations expenses.

**Gain from Change in Fair Value of Warrant Liabilities, Loss on Issuance of Warrant Liabilities and Loss on Extinguishment of Warrant Liabilities**

During the year ended December 31, 2025, we recognized a non-cash gain of $24.4 million related to the change in fair value of our warrant liabilities, a non-cash loss of $31.0 million associated with the issuance of warrant liabilities in connection with our equity offerings, and a $0.6 million non-cash loss related to the extinguishment of warrant liabilities that were reclassified to equity. Certain of our warrants are classified as liabilities and are remeasured at fair value upon issuance and at each reporting date, as well as upon modification or inducement. Changes in the fair value of these instruments are recognized in the consolidated statements of operations in the period in which they occur. The fair value of these warrant liabilities is estimated using a Monte Carlo simulation model, which incorporates significant assumptions including expected volatility, expected term, risk-free interest rate, and the contractual terms of the warrants, including path-dependent features. Because the valuation is sensitive to changes in our stock price and other inputs, the resulting gains or losses can be significant and may fluctuate materially from period to period. In general, decreases in our stock price during a reporting period result in non-cash gains, while increases in our stock price result in non-cash losses related to the remeasurement of warrant liabilities.

**Transaction Costs Allocated to Warrant Liabilities**

During the year ended December 31, 2025, we recognized $1.4 million of transaction costs associated with the issuance of Series E and Series F warrant liabilities in June and August 2025, respectively.

**Interest Income, Net**

Interest income, net decreased by approximately $0.4 million for the year ended December 31, 2025 from the comparable period in 2024 due to a decreasing cash balance during the past year.

**Net Loss**

Net loss for the year ended December 31, 2025 was $33.6 million, compared to a net loss of $26.0 million for the prior year. The current-year net loss includes a $31.0 million non-cash loss related to the issuance of warrant liabilities, a $24.4 million non-cash gain from the change in the fair value of warrant liabilities, and a $0.6 million non-cash loss on the extinguishment of warrant liabilities that were reclassified to equity.

**Liquidity and Capital Resources** 

As of December 31, 2025, we had cash and cash equivalents of $8.9 million and prepaid expenses and other current assets of $0.8 million. We also had $3.5 million of accounts payable and $3.3 million of accrued expenses and other current liabilities. A significant portion of the accounts payable and accrued expenses were due to work performed in relation to our preclinical activities and our clinical trials. For the years ended December 31, 2025 and 2024, we used approximately $22.7 million and $23.9 million of cash in operating activities, respectively, which represents cash outlays for research and development and general and administrative expenses in such periods. The slightly decreased cash outflows in 2025 was primarily due to timing of payments for sponsored research and other expenses. For the year ended December 31, 2025, there were $27.3 million in net proceeds from financing activities. In 2024, there were $4.6 million in net proceeds from financing activities. Cash used in investing activities for the years ended December 31, 2025 and 2024 was approximately $0 and $13,000, respectively.

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We believe that our cash resources as of December 31, 2025, along with $8.3 million in gross proceeds received via our financing activities in the first quarter of 2026 (see Recent Stock Offerings below) will be sufficient to fund our planned operations into the third quarter of 2026, without the issuance of additional equity for cash. This takes into account cash outlays for preparations for clinical trials beyond the current active trials. The continuation of our Company as a going concern is dependent upon our ability to obtain necessary financing to continue operations and the attainment of profitable operations. We may seek additional funding through a combination of equity offerings, debt financings, government or other third-party funding, commercialization, marketing and distribution arrangements, other collaborations, strategic alliances and licensing arrangements and delay planned cash outlays or a combination thereof. We cannot provide assurance that such events or a combination thereof can be achieved.

*Recent Stock Offerings*

We have historically funded our operations through a combination of at-the-market equity sales, public offerings, and warrant exercises, including warrant exercise inducement transactions, and we expect to continue to rely on these sources of capital to support our operations.

On February 19, 2026, we entered into warrant inducement agreements with certain holders of our existing equity-classified Series E and Series F warrants. Pursuant to these agreements, the holders exercised warrants to purchase an aggregate of 2,122,652 shares of our common stock at an exercise price of $3.90 per share, resulting in gross proceeds of approximately $8.3 million. In consideration for such exercises, we issued new Series H warrants to purchase up to 6,367,956 shares of common stock. The Series H warrants are exercisable upon shareholder approval, have a term of five years from such approval, and an exercise price of $2.3976 per share. The Series H warrants contain customary anti-dilution adjustments and beneficial ownership limitations. We have agreed to file a resale registration statement covering the shares of common stock issuable upon exercise of the Series H warrants on or before March 31, 2026, and to use commercially reasonable efforts to cause such registration statement to be declared effective by April 30, 2026. Due to the completion of this transaction, the exercise price of our outstanding Series E warrants was adjusted to $3.00 per share, the exercise price of our outstanding Series F warrants was adjusted to $2.75 per share, and the exercise price of our outstanding Series G and Series H warrants was adjusted to $2.3976 per share.

On December 23, 2025, we increased the maximum aggregate gross sales price of our common stock that may be offered, issued and sold under our at the market equity offering agreement (the "2025 ATM Agreement") with Roth Capital Partners, LLC ("Roth"), which we initially entered into in July 2025, from $6.5 million to $8.2 million. Pursuant to the terms of the 2025 ATM Agreement, we may offer and sell shares of our common stock having an aggregate offering price of up to $8.2 million from time to time through or to Roth, acting as sales agent or principal. Roth may sell shares of our common stock in negotiated transactions at market prices prevailing at the time of sale or at prices related to such prevailing market prices. We pay Roth a commission equal to 3.0% of the gross proceeds from any shares of common stock sold under the 2025 ATM Agreement. During the fourth quarter of 2025, we sold 1,130,420 shares of common stock pursuant to the 2025 ATM Agreement for gross proceeds of approximately $1.1 million.

On December 21, 2025, we entered into separate warrant amendment agreements (collectively, the "Warrant Amendment") with the holders of our Series E, Series F, and Series G warrants (each as defined below, and collectively, the "Warrants"). Pursuant to the Warrant Amendment, the exercise prices of the Warrants were reduced to $3.90 per share (which was subsequently adjusted as described above). In addition, the Series E and Series F warrants were amended to eliminate certain price adjustment provisions and to revise the definition of "Black-Scholes Value". The revised definition of Black-Scholes Value modified the expected volatility input used in the Black-Scholes option pricing model by eliminating the use of 30-day and 365-day historical volatility measures and limiting the volatility input to the greater of (i) 100-day historical volatility, as obtained from Bloomberg, or (ii) 100%. All other inputs to the Black-Scholes model, including the risk-free interest rate, underlying stock price, expected term, and cost of borrow, remained unchanged. As a result of the Warrant Amendment, we determined that the Series E and Series F warrants qualified for equity classification prospectively under applicable accounting guidance. Accordingly, upon the effectiveness of the Warrant Amendment, the Series E and Series F warrants were reclassified from liability to equity. In connection with the reclassification, we remeasured the Series E and Series F warrant liabilities to fair value immediately prior to reclassification, resulting in the recognition of a $21.5 million gain in the consolidated statement of operations. We then reclassified approximately $16.0 million of Series E and Series F warrant liabilities to additional paid-in capital. In addition, we recorded a loss on extinguishment of warrant liabilities of $0.6 million and a warrant-related deemed dividend of $0.1 million, which was recorded within additional paid-in capital and recognized as a reduction to income available to common stockholders. See Note 5 of our consolidated financial statements in Item 8 in this Annual Report on Form 10-K for further discussion. If exercised in full, the Warrants could result in gross proceeds to us of up to approximately $29.4 million.

On December 9, 2025, we entered into warrant exercise inducement agreements with holders of certain outstanding Series C, Series D and Series F warrants, pursuant to which such holders agreed to exercise warrants to purchase an aggregate of 1,044,329 shares of our common stock at reduced or existing exercise prices in exchange for the issuance of Series G warrants to purchase up to 2,610,823 shares of common stock, representing 250% of the shares underlying the exercised warrants, with a five-year exercise term. We received gross proceeds of approximately $6.8 million from the warrant exercises. Pursuant to ASC 815, and in accordance with our accounting policy, we determined that Series G warrants met the criteria for equity classification as of their issuance date. Additionally, we utilized our ATM on this date and sold 86,475 shares for gross proceeds of $0.6 million.

In August 2025, we entered into a warrant exercise inducement offer letter with holders of certain existing warrants pursuant to which the holders agreed to exercise Series E warrants to purchase up to 648,649 shares of common stock with an exercise price of $9.25 per share in exchange for our issuing new Series F warrants to purchase 2,594,595 shares of our common stock. Each Series F warrant had an exercise price of $13.75 per share (which was subsequently adjusted as described above) and is exercisable as of the date of issuance to October 16, 2030. We received gross proceeds of $6.0 million. In addition, during August and September 2025, 119,848 shares of Series E warrants were exercised for $1.1 million. Upon issuance the Series F warrants were initially classified as liability warrants. Pursuant to the Warrant Amendment described above, the Series F warrants were equity-classified as of December 21, 2025. In total, we received gross proceeds of $7.1 million.

In June 2025, we completed a public offering for the sale of 398,881 shares of common stock, and 244,319 pre-funded warrants to purchase shares of common stock, and Series E warrants to purchase up to 1,929,600 shares of common stock. The combined purchase price for the securities was $9.25 per share of common stock (or pre-funded warrant in lieu thereof). Each Series E warrant expires five years from the initial exercise date, or August 18, 2030. We received gross proceeds of $5.9 million.

On February 25, 2025, we entered into a securities purchase agreement with an institutional investor for the sale of 46,000 shares of common stock, and 84,841 pre-funded warrants to purchase shares of common stock, and Series D warrants to purchase up to 261,722 shares of common stock. The combined purchase price for the securities was $26.75 per share of common stock (or pre-funded warrant in lieu thereof). Each pre-funded warrant was exercisable for one share of common stock at an exercise price of $0.025 per share. All pre-funded warrants were exercised in June 2025. The Series D warrants expire five years from the initial exercise date, or August 18, 2030. We received gross proceeds of $3.5 million.

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On February 13, 2025, we entered into a warrant exercise inducement offer letter with a holder of certain existing warrants to receive new warrants to purchase up to a number of shares of common stock equal to 200% of the number of warrant shares issued pursuant to the exercise of such existing warrants to purchase up to 233,143 shares of common stock pursuant to which the warrant holder agreed to exercise for cash their existing warrants at a reduced exercise price of $25.00 in exchange for our agreement to issue the inducement warrants to purchase up to 466,286 shares of our common stock. Each inducement warrant is exercisable as of the date of issuance and may be exercised for a period of five years from the date of issuance. We received gross proceeds of $5.8 million.

On August 19, 2024, we completed a public offering of 11,320 shares of common stock and 87,355 pre-funded warrants to purchase shares of common stock, Series A warrants to purchase up to 98,655 shares of common stock and Series B warrants to purchase up to 98,655 shares of common stock, at a combined public offering price of $55.75 per share (or per pre-funded warrant in lieu thereof) and accompanying warrants. We received gross proceeds of $5.5 million, before deducting the placement agent's fees and other offering expenses.

The following table sets forth the primary sources and uses of cash for the years indicated (in thousands):

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| | | |
|:---|:---|:---|
|  | **For the Year Ended December 31,** | **For the Year Ended December 31,** |
|  | **2025** | **2024** |
| Net cash used in operating activities | $(22735) | $(23862) |
| Net cash used in investing activities |  | (13) |
| Net cash provided by financing activities | 27284 | 4635 |
| Effect of exchange rate changes on cash and cash equivalents | 51 | (32) |
| Net change in cash and cash equivalents | $4600 | $(19272) |

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*Cash used in operating activities*

Net cash used in operating activities was $22.7 million for the year ended December 31, 2025 compared to $23.9 million for the year ended December 31, 2024. This slight decrease in use of cash for operations was mainly due to timing of payments related to sponsored research and other expenses.

*Cash used in investing activities*

Net cash used in investing activities was de minimis for the years ended December 31, 2025 and December 31, 2024, respectively.

*Cash provided by financing activities*

Net cash provided by financing activities was $27.3 million for the year ended December 31, 2025, During 2025, we generated cash from financing activities primarily through at-the-market equity sales, public offerings, and warrant exercises, including warrant exercise inducement transactions. In the aggregate, these activities generated $27.3 million in net proceeds, including $1.0 million from at-the-market equity sales during the fourth quarter of 2025, $24.8 million from the issuance of common stock as a result of warrant inducement, pre-funded warrants, and common warrants, and $1.5 million from warrant exercises. Net cash provided by financing activities was $4.6 million for the year ended December 31, 2024, consisting of proceeds from the August 2024 stock offering.

**Contractual Obligations**

Our contractual obligations and commitments relate primarily to our operating leases and license, sponsored research, consulting, and laboratory access agreements with various research and development centers for the development and commercialization of our drug candidates targeting acute myeloid leukemia and certain hard to treat cancers. See Note 8 to our consolidated financial statements in Item 8 of this Annual Report on Form 10-K for further discussion.

**Off-Balance Sheet Transactions**

As of December 31, 2025, we did not have any off-balance sheet arrangements.

**Recent Accounting Pronouncements** 

We have implemented all new accounting pronouncements that are in effect and may impact our financial statements and we do not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on our financial position or results of operations. Refer to Note 2 of our consolidated financial statements in Item 8 in this Annual Report on Form 10-K for additional discussion.

**Critical Accounting Policies and Significant Judgments and Estimates** 

The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (US GAAP) for financial information, and in accordance with the rules and regulations of the SEC.

We believe that the following accounting policies are the most critical to aid in fully understanding and evaluating our reported financial results, and they require our most difficult, subjective or complex judgments, resulting from the need to make estimates about the effect of matters that are inherently uncertain**.**

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***Research and Development Costs***

We record accrued expenses for estimated costs of our research and development activities conducted by third-party service providers, which include the conduct of pre-clinical and clinical trials and preparation for clinical trials and contract manufacturing activities. We record the estimated costs of research and development activities based upon the estimated amount of services provided but not yet invoiced, and we include these costs in accrued liabilities in the balance sheets and within research and development expense in the statement of operations. These costs are a significant component of our research and development expenses. We record accrued expenses for these costs based on the estimated amount of work completed and in accordance with agreements established with these third parties.

We estimate the amount of work completed through discussions with internal personnel and external service providers as to the progress or stage of completion of the services and the agreed-upon fee to be paid for such services. We make significant judgments and estimates in determining the accrued balance in each reporting period. As actual costs become known, we adjust our accrued estimates. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed may vary from our estimates and could result in us reporting amounts that are too high or too low in any particular period. Our accrued expenses are dependent, in part, upon the receipt of timely and accurate reporting from clinical research organizations and other third-party service providers. To date, there have been no material differences from our accrued expenses to actual expenses.

***Impairment of Long-Lived Assets***

We evaluate the recoverability of our property and equipment and amortizable intangible assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable or at a minimum annually during the third quarter of the year. Recoverability of these assets is measured by a comparison of the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If such review indicates that the carrying amount of property and equipment and amortizable intangible assets is not recoverable, the carrying amount of such asset is reduced to fair value.

Acquired in-process research and development (IPR&D) assets are considered indefinite lived until the completion or abandonment of the associated research and development efforts. We evaluate the recoverability of our IPR&D assets for possible impairment annually during the fourth quarter or whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of IPR&D assets is measured by a comparison of the carrying amounts its fair value. If such review indicates that the carrying amount of IPR&D assets is not recoverable, the carrying amount of such asset is reduced to fair value.

**Components of our Results of Operations, Net Loss and Financial Condition**

***Operating expenses***

We classify our operating expenses into three categories: research and development, general and administrative and depreciation.

*Research and development*. Research and development expenses consist primarily of:

• costs incurred to conduct research, such as the discovery and development of our product candidates;

• costs related to production of clinical supplies, including fees paid to contract manufacturers and drug manufacturing costs;

• fees paid to clinical consultants, clinical trial sites and vendors, including clinical research organizations, in preparation for clinical trials and our IND and Orphan Drug applications with the FDA; and

• costs related to compliance with drug development regulatory requirements.

We recognize all research and development costs as they are incurred. Pre-clinical costs, contract manufacturing and other development costs incurred by third parties are expensed as the contracted work is performed.

We expect our research and development expenses to increase in the future as we advance our product candidates into and through clinical trials and pursue regulatory approval of our product candidates in the United States and Europe. The process of conducting the necessary clinical research to obtain regulatory approval is costly and time-consuming. The actual probability of success for our product candidates may be affected by a variety of factors including: the quality of our product candidates, early clinical data, investment in our clinical program, competition, manufacturing capability and commercial viability. We may never succeed in achieving regulatory approval for any of our product candidates. As a result of the uncertainties discussed above, we are unable to determine the duration and completion costs of our research and development projects or when and to what extent, if any, we will generate revenue from the commercialization and sale of our product candidates.

*General and administrative* 

General and administrative expense consists of personnel related costs, which include salaries, as well as the costs of professional services, such as accounting and legal, facilities, information technology and other administrative expenses. We expect our general and administrative expense to increase due to the anticipated growth of our business and related infrastructure as well as accounting, insurance, investor relations and other costs associated with being a public company.

*Depreciation and Amortization.*

Depreciation and amortization expense consists of depreciation on our property and equipment. We depreciate our assets over their estimated useful life. We estimate leasehold improvements to have an estimated useful life over the term of the lease or the estimated useful life, whichever is shorter; computer equipment to have a 2-year life; software to have a 3-year life, machinery and equipment to have a 2 to 5 year life and furniture and office equipment to have a 2 to 7 year life.

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***Accounting for warrants***

When the Company enters into arrangements pursuant to which warrants are issued, modified, or amended, we evaluate the terms of the warrants to determine the appropriate accounting and classification in accordance with FASB Accounting Standards Codification ("ASC") Topic 480, *Distinguishing Liabilities from Equity* ("ASC 480"), ASC Topic 505, *Equity* ("ASC 505"), ASC Topic 815, *Derivatives and Hedging* ("ASC 815"), and ASC Topic 718, *Compensation*—*Stock Compensation* ("ASC 718").

Warrants that meet the criteria for liability classification under ASC 480, or that do not meet the criteria for equity classification under ASC 815 due to exercise contingencies, settlement provisions, or other contractual terms, are accounted for as derivative liabilities. These warrants are measured at fair value in accordance with ASC 820, *Fair Value Measurement*, with changes in fair value recognized in earnings, and are presented as warrant liabilities on the Company's consolidated balance sheets. Warrants that meet the criteria for equity classification are recorded in stockholders' equity.

During the year ended December 31, 2025, we changed our accounting policy related to the classification of certain outstanding warrants. Prior to the change in accounting policy, our policy was to account for warrants with a certain contingent settlement provision as liability warrants, initially measuring them at fair value on the date of issuance. The warrants were previously remeasured at fair value at the end of each reporting period, with the related liability reflected on our balance sheet. The changes in fair value during each previous reporting period were recognized as a gain (loss) from change in fair value of warrant liability in our consolidated statement of operations. We changed our policy and warrants that contain this certain contingent settlement provision are now accounted for as equity under ASC 815-40-15-7C through 15-7F and ASC 505. We concluded that accounting for our warrants as equity instruments is preferable under ASC 250, as equity classification better reflects the economic substance of the arrangement and enhances the clarity and consistency of our financial reporting. As a result of this change in accounting policy, all warrants issued prior to 2025, and certain warrants issued in 2025, that were previously accounted for as liability awards due to the certain contingent settlement provision now meet the equity classification criteria under ASC 815-40 and are classified as equity instruments. The effects of the change in accounting policy from warrant liabilities to equity have been retrospectively applied to all periods presented in these consolidated financial statements. See Note 2 and Note 5 of our consolidated financial statements in Item 8 in this Annual Report on Form 10-K for further discussion.

As a result of the change in accounting policy, we adjusted accumulated deficit, and additional paid-in capital to reverse previously recorded mark-to-market fair value changes of the liability-classified warrants.

***Valuation of Warrant Liabilities***

The fair value of the warrant liabilities is estimated using a Monte Carlo simulation model. This model is utilized due to certain features of the warrants, including path-dependent or market-based provisions, which cannot be appropriately valued using simpler option pricing models. The valuation model incorporates assumptions related to:

• the market price of our common stock at the measurement date;

• the contractual term of the warrants;

• expected volatility of our common stock;

• risk-free interest rates; and

• expected dividend yield.

The risk-free interest rate is based on observed interest rates of zero-coupon U.S. Treasury instruments with maturities corresponding to the expected term of the warrants. Expected volatility represents the amount by which our stock price is expected to fluctuate over the expected life of the warrants.

Changes in the fair value of warrant liabilities are recorded as other income or expense in the consolidated statements of operations.

***Allocation of Warrant Proceeds***

For equity offerings during 2025 that included both common stock, equity-classified warrants, and warrants classified as liabilities, we allocated the proceeds first to the warrants based on their fair value at issuance, with the residual proceeds allocated to the equity instruments, including common stock and pre-funded warrants.

***Stock-based compensation***

Stock based compensation transactions are recognized as compensation expense in the statement of operations based on their fair values on the date of the grant, with the compensation expense recognized over the period in which a grantee is required to provide service in exchange for the award. We estimate the fair value of options granted using the Black-Scholes option valuation model (BSM), and the fair value of restricted stock units using the closing price of our common stock as reported on the date of grant. The Black-Scholes estimate uses assumptions regarding a number of inputs that require us to make significant estimates and judgments. Beginning in 2020, only the volatility of our stock was used in the BSM as we now have sufficient historic data in our stock price.

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***Income taxes***

**Recent accounting pronouncements**

See Note 2 of our consolidated financial statements in Item 8 in this Annual Report on Form 10-K for discussion regarding recent accounting pronouncements.

**ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS**

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide information required under this item.

**ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA**

The financial statements required by this item are set forth beginning in Item 15 of this report and are incorporated herein by reference.

**ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE**

There have been no disagreements with our independent registered public accountants on accounting or financial disclosure matters during our two most recent fiscal years.

**ITEM 9A. CONTROLS AND PROCEDURES** 

**Evaluation of Disclosure Controls and Procedures**

Our management has evaluated 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), as of the end of the period covered by this Form 10-K. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, refers to controls and procedures that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms and that such information is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding disclosure.

Management concluded that our disclosure controls and procedures were effective as of December 31, 2025.

**Attestation Report of the Registered Public Accounting Firm**

Our independent registered public accounting firm will not be required to formally attest to the effectiveness of our internal controls over financial reporting for as long as we are a "non-accelerated filer."

**Management's Report on Internal Control Over Financial Reporting** 

Our principal executive officer and our principal accounting and financial officer, are responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Management conducted an assessment of the effectiveness of our internal control over financial reporting as of December 31, 2025. In making this assessment, management used the criteria described in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Our management concluded that our internal control over financial reporting was effective as of December 31, 2025.

**Changes in Internal Control Over Financial Reporting**

There was no change in the Company's internal control over financial reporting identified in connection with the evaluation required by Rules 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the year ended December 31, 2025, that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

**ITEM *9B.* OTHER INFORMATION.**

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This choice of forum provision *may* limit a stockholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which *may* discourage such lawsuits against us and our directors, officers and employees. Alternatively, a court could find these provisions of our certificate of incorporation to be inapplicable or unenforceable in respect of *one* or more of the specified types of actions or proceedings, which *may* require us to incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business and financial condition.

During the *three* months ended *December 31, 2025*, no director or officer of the Company adopted or terminated a "Rule *10b5*-*1* trading arrangement" or "non-Rule *10b5*-*1* trading arrangement," as each term is defined in Item *408*(a) of Regulation S-K.

**ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.**

Not applicable.

 **PART III**

**ITEM *10.* DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE**

The information required by this item is incorporated by reference to our proxy statement for the *2026* Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission within *120* days of the fiscal year ended *December 31, 2025* and is incorporated into this Annual Report on Form 10-K by reference.

Our Board of Directors has adopted a written Code of Business Conduct and Ethics applicable to all officers, directors and employees, which is available on our website (www.moleculin.com) under "Governance Documents" within the "Corporate Governance" section. We intend to satisfy the disclosure requirement under Item *5.05* of Form *8*-K regarding amendment to, or waiver from, a provision of this Code and by posting such information on the website address and location specified above.

**ITEM *11.* EXECUTIVE COMPENSATION**

The information required by this item is incorporated by reference to our proxy statement for the *2026* Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission within *120* days of the fiscal year ended *December 31, 2025* and is incorporated into this Annual Report on Form 10-K by reference.

**ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS**

The information required by this item is incorporated by reference to our proxy statement for the 2026 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission within 120 days of the fiscal year ended December 31, 2025 and is incorporated into this Annual Report on Form 10-K by reference.

**ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE**

The information required by this item is incorporated by reference to our proxy statement for the 2026 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission within 120 days of the fiscal year ended December 31, 2025 and is incorporated into this Annual Report on Form 10-K by reference.

**ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES**

The information required by this item is incorporated by reference to our proxy statement for the 2026 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission within 120 days of the fiscal year ended December 31, 2025 and is incorporated into this Annual Report on Form 10-K by reference.

**PART IV**

**ITEM 15. EXHIBITS AND FINANCIAL STATEMENTS**

a. Documents filed as part of this Report

1. Financial Statements

The financial statements and notes thereto which are attached hereto have been included by reference into Item 8 of this part of the annual report on Form 10-K. See the Index to Financial Statements on page below.

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2. Financial Statement Schedules

All schedules are omitted because they are inapplicable or not required or the required information is shown in the financial statements or notes thereto.

3. Exhibits

**EXHIBIT INDEX**

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| | |
|:---|:---|
| **Exhibit**<br> **Number** | **Description** |
| 3.1  | [Amended and Restated Certificate of Incorporation of Moleculin Biotech, Inc. (incorporated by reference to exhibit 3.1 of the Form S-1/A filed March 21, 2016)](http://www.sec.gov/Archives/edgar/data/1659617/000114420416089330/v434611_ex3-1.htm) |
| 3.2  | [Certificate of Amendment of the Amended and Restated Certificate of Incorporation of Moleculin Biotech, Inc. (incorporated by reference to Exhibit 3.1 of the Form 8-K filed May 24, 2019)](http://www.sec.gov/Archives/edgar/data/1659617/000165961719000077/exh31moleculin-charteramen.htm) |
| 3.3  | [Certificate of Amendment of the Amended and Restated Certificate of Incorporation of Moleculin Biotech, Inc. (incorporated by reference to Exhibit 3.1 of the Form 8-K filed January 29, 2021)](http://www.sec.gov/Archives/edgar/data/1659617/000143774921001530/ex_223281.htm) |
| 3.4 | [Certificate of Amendment of the Amended and Restated Certificate of Incorporation of Moleculin Biotech, Inc. (incorporated by reference to Exhibit 3.1 of the Form 8-K filed March 19, 2024)](http://www.sec.gov/ix?doc=/Archives/edgar/data/0001659617/000143774924008537/mbrx20240318_8k.htm) |
| 3.5 | [Amendment to Amended and Restated Certificate of Incorporation of Moleculin Biotech, Inc., dated August 21, 2025 (incorporated by reference to Exhibit 3.1 of the Form 8-K filed August 27, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925027798/ex_857436.htm) |
| 3.6 | [Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Moleculin Biotech, Inc., filed with the Secretary of State of the State of Delaware. (incorporated by reference to Exhibit 3.1 of the Form 8-K filed November 28, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925036488/ex_893490.htm) |
| 3.7 | [Amended and Restated Bylaws of Moleculin Biotech., Inc. (incorporated by reference to exhibit 3.1 of the Form 8-K filed December 17, 2021)](http://www.sec.gov/Archives/edgar/data/1659617/000143774921028903/ex_316725.htm) |
| 4.1 | [Description of Registrant's Securities](http://www.sec.gov/Archives/edgar/data/1659617/000143774922007103/ex_310070.htm) |
| 4.2 | [Form of Common Warrant Agreement issued in December 2023 offering (incorporated by reference to Exhibit 4.2 of the Form 8-K filed December 21, 2023)](http://www.sec.gov/Archives/edgar/data/1659617/000143774923035141/ex_609179.htm) |
| 4.3 | [Form of Placement Agent Warrant issued in August 2024 offering (incorporated by reference to Exhibit 4.12 of the Form S-1/A filed August 15, 2024)](http://www.sec.gov/Archives/edgar/data/1659617/000143774924026932/ex_715063.htm) |
| 4.4 | [Form of Amended and Restated Series E Warrant (incorporated by reference to Exhibit 4.1 of the Form 8-K filed December 22, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925038478/ex_901475.htm) |
| 4.5 | [Form of Amended and Restated Series F Warrant (incorporated by reference to Exhibit 4.2 of the Form 8-K filed December 22, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925038478/ex_901476.htm) |
| 4.6 | [Form of Amended and Restated Series G Warrant (incorporated by reference to Exhibit 4.3 of the Form 8-K filed December 22, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925038478/ex_901551.htm) |
| 4.7 | [Form of Series H Warrant (incorporated by reference to Exhibit 4.1 of the Form 8-K filed February 20, 2026)](http://www.sec.gov/Archives/edgar/data/1659617/000143774926004800/ex_922997.htm) |
| 10.1 \*\* | [Moleculin Biotech, Inc. Amended and Restated 2015 Stock Plan, as amended (incorporated by reference to Exhibit 4.5 of the Form S-8 file number 333-272814)](http://www.sec.gov/Archives/edgar/data/1659617/000143774923018012/ex_534670.htm) |
| 10.2 | [Rights Transfer Agreement between Moleculin Biotech, Inc. and AnnaMed, Inc. (incorporated by reference to exhibit 10.2 of the Form S-1/A filed March 21, 2016)](http://www.sec.gov/Archives/edgar/data/1659617/000114420416089330/v434611_ex10-2.htm) |
| 10.3  | [Patent and Technology License Agreement dated June 21, 2010 by and between The Board of Regents of the University of Texas System and Moleculin, LLC (incorporated by reference to exhibit 10.3 of the Form S-1/A filed March 21, 2016)](http://www.sec.gov/Archives/edgar/data/1659617/000114420416089330/v434611_ex10-3.htm) |
| 10.4  | [Amendment No. 1 to the Patent and Technology License Agreement dated June 21, 2010 by and between The Board of Regents of the University of Texas System and Moleculin, LLC (incorporated by reference to exhibit 10.4 of the Form S-1/A filed March 21, 2016)](http://www.sec.gov/Archives/edgar/data/1659617/000114420416089330/v434611_ex10-4.htm) |

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| | |
|:---|:---|
| 10.5  | [Patent and Technology License Agreement dated April 2, 2012 by and between The Board of Regents of the University of Texas System and IntertechBio Corporation (incorporated by reference to exhibit 10.5 of the Form S-1/A filed March 21, 2016)](http://www.sec.gov/Archives/edgar/data/1659617/000114420416089330/v434611_ex10-5.htm) |
| 10.6  | [Amendment No. 1 to the Patent and Technology License Agreement dated April 2, 2012 by and between The Board of Regents of the University of Texas System and IntertechBio Corporation (incorporated by reference to exhibit 10.6 of the Form S-1/A filed March 21, 2016)](http://www.sec.gov/Archives/edgar/data/1659617/000114420416089330/v434611_ex10-6.htm) |
| 10.7 | [Rights Transfer Agreement between Moleculin Biotech, Inc. and IntertechBio Corporation dated August 11, 2015 (incorporated by reference to exhibit 10.10 of the Form S-1/A filed March 21, 2016)](http://www.sec.gov/Archives/edgar/data/1659617/000114420416089330/v434611_ex10-10.htm) |
| 10.8 | [Agreement and Plan of Merger between Moleculin Biotech, Inc. and Moleculin, LLC (incorporated by reference to exhibit 10.11 of the Form S-1/A filed March 21, 2016)](http://www.sec.gov/Archives/edgar/data/1659617/000114420416089330/v434611_ex10-11.htm) |
| 10.9 | [Technology Rights and Development License Agreement to be entered into by Moleculin Biotech, Inc. and Houston Pharmaceuticals, Inc. (incorporated by reference to exhibit 10.13 of the Form S-1/A filed April 15, 2016)](http://www.sec.gov/Archives/edgar/data/1659617/000114420416094685/v436948_ex10-13.htm) |
| 10.10 | [Lease Agreement for 5300 Memorial (incorporated by reference to Exhibit 10.1 of the Form 10-Q filed May 14, 2018)](http://www.sec.gov/Archives/edgar/data/1659617/000165961718000056/exh101leaseagreement5300me.htm) |
| 10.11 † | [Patent And Technology License Agreement dated February 12, 2018 by and between The Board of Regents of The University Of Texas System on behalf of The University Of Texas M. D. Anderson Cancer Center and Moleculin Biotech, Inc. (incorporated by reference to Exhibit 10.2 of the Form 10-Q filed May 14, 2018)](http://www.sec.gov/Archives/edgar/data/1659617/000165961718000056/exh102licensemda18-010fina.htm) |
| 10.12 | [Sublicense Agreement dated as of February 19, 2019 entered into between the Company and Animal Life Sciences, LLC (incorporated by reference to Exhibit 10.22 of the Form 10-K filed February 21, 2019)](http://www.sec.gov/Archives/edgar/data/1659617/000165961719000018/a2018q410-kexhibit1022.htm) |
| 10.13 | [Consulting Agreement, dated March 16, 2020, entered into between the Company and Houston Pharmaceuticals, Inc. (HPI) (incorporated by reference to Exhibit 10.24 of the Form 10-K filed March 19, 2020)](http://www.sec.gov/Archives/edgar/data/1659617/000165961720000066/a2019q410-kexh1024cons.htm) |
| 10.14 | [Equipment Lab Letter, dated March 16, 2020, entered into between the Company and Houston Pharmaceuticals, Inc. (HPI) (incorporated by reference to Exhibit 10.25 of the Form 10-K filed March 19, 2020)](http://www.sec.gov/Archives/edgar/data/1659617/000165961720000066/a2019q410-kexh1025hpie.htm) |
| 10.15 | [Scientific Advisory Board Agreement, dated February 28, 2020, entered into between the Company and Waldemar Priebe, PhD (incorporated by reference to Exhibit 10.26 of the Form 10-K filed March 19, 2020)](http://www.sec.gov/Archives/edgar/data/1659617/000165961720000066/a2019q410-kexh1026saba.htm) |
| 10.16 + | [Amendment No. 3 to Patent and Technology License Agreement between the Parties dated April 2, 2012, dated May 20, 2020, entered into between the Company and the Board of Regents of The University of Texas System, on behalf of The University of Texas M.D. Anderson Cancer Center (incorporated by reference to Exhibit 10.1 of the Form 10-Q filed August 12, 2020)](http://www.sec.gov/Archives/edgar/data/1659617/000165961720000196/exhibit101-mdaamendno3.htm) |
| 10.17 + | [Amendment No. 4 to Patent and Technology License Agreement between the Parties dated April 2, 2012, dated June 15, 2021, entered into between the Company and the Board of Regents of The University of Texas System, on behalf of The University of Texas M.D. Anderson Cancer Center (incorporated by reference to Exhibit 10.4 of the Form 10-Q filed August 12, 2021)](http://www.sec.gov/Archives/edgar/data/1659617/000143774921019445/ex_269494.htm) |
| 10.18 + | [Patent And Technology License Agreement dated June 29, 2017 by and between The Board of Regents of The University Of Texas System on behalf of The University Of Texas M. D. Anderson Cancer Center and Moleculin Biotech, Inc. (incorporated by reference to Exhibit 10.30 of the Form 10-K filed March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1659617/000143774922007103/ex_350306.htm) |
| 10.19 + | [Amendment No. 1 to the Patent And Technology License Agreement dated June 29, 2017 by and between The Board of Regents of The University Of Texas System on behalf of The University Of Texas M. D. Anderson Cancer Center and Moleculin Biotech, Inc. (incorporated by reference to Exhibit 10.31 of the Form 10-K filed March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1659617/000143774922007103/ex_349147.htm) |
| 10.20 + | [Patent And Technology License Agreement dated December 2, 2021 by and between The Board of Regents of The University Of Texas System on behalf of The University Of Texas M. D. Anderson Cancer Center and Moleculin Biotech, Inc. (incorporated by reference to Exhibit 10.32 of the Form 10-K filed March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1659617/000143774922007103/ex_349149.htm) |
| 10.21 + | [Patent And Technology License Agreement dated December 3, 2021 by and between The Board of Regents of The University Of Texas System on behalf of The University Of Texas M. D. Anderson Cancer Center and Moleculin Biotech, Inc. (incorporated by reference to Exhibit 10.33 of the Form 10-K filed March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1659617/000143774922007103/ex_349151.htm) |
| 10.22 + | [Patent And Technology License Agreement dated February 3, 2022 by and between The Board of Regents of The University Of Texas System on behalf of The University Of Texas M. D. Anderson Cancer Center and Moleculin Biotech, Inc. (incorporated by reference to Exhibit 10.34 of the Form 10-K filed March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1659617/000143774922007103/ex_349150.htm) |
| 10.23 + | [Patent and Technology License Agreement dated October 21, 2022 by and between The Board of The University Of Texas System on behalf of The University Of Texas M.D. Anderson Cancer Center and Moleculin Biotech, Inc. (incorporated by reference to Exhibit 10.27 of the Form 10-K filed March 22, 2023)](http://www.sec.gov/Archives/edgar/data/1659617/000143774923007537/ex_491248.htm) |
| 10.24 | [First Amendment to Commercial Lease Agreement (incorporated by reference to Exhibit 10.1 of the Form 10-Q filed November 13, 2023)](http://www.sec.gov/Archives/edgar/data/1659617/000143774923031391/ex_593048.htm) |
| 10.25 | [Amended and Restated Employment Agreement between Moleculin Biotech, Inc. and Walter V. Klemp dated January 4, 2024 (incorporated by reference to Exhibit 10.1 of the Form 8-K filed January 5, 2024)](http://www.sec.gov/Archives/edgar/data/1659617/000143774924000758/ex_612467.htm) |

---

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---

| | |
|:---|:---|
| 10.26 | [Amended and Restated Employment Agreement between Moleculin Biotech, Inc. and Jonathan P. Foster dated January 4, 2024 (incorporated by reference to Exhibit 10.2 of the Form 8-K filed January 5, 2024)](http://www.sec.gov/Archives/edgar/data/1659617/000143774924000758/ex_612468.htm) |
| 10.27 | [Employment Agreement between Moleculin Biotech, Inc. and Donald Picker dated January 4, 2024 (incorporated by reference to Exhibit 10.3 of the Form 8-K filed January 5, 2024)](http://www.sec.gov/Archives/edgar/data/1659617/000143774924000758/ex_612469.htm) |
| 10.28 + | [Moleculin Biotech, Inc. 2024 Stock Plan (incorporated by reference to Exhibit 10.1 of the Form 8-K filed October 25, 2024)](http://www.sec.gov/Archives/edgar/data/0001659617/000143774924032138/ex_737297.htm) |
| 10.29 + | [Forms of award agreements under Moleculin Biotech, Inc. 2024 Stock Plan (incorporated by reference to Exhibit 99.2 of the Form S-8 filed September 10, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925028767/ex_859784.htm) |
| 10.30 | [At The Market Offering Agreement, dated July 11, 2025, by and between Moleculin Biotech, Inc. and Roth Capital Partners, LLC (incorporated by reference to Exhibit 1.1 of the Form 8-K filed July 11, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925022606/ex_838237.htm) |
| 10.31 | [Form of Inducement Letter for holder of Series C warrants and Series D warrants (incorporated by reference to Exhibit 10.1 of the Form 8-K filed December 10, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925037414/ex_897658.htm) |
| 10.32 | [Form of Inducement Letter for holders of certain Series F warrants (incorporated by reference to Exhibit 10.2 of the Form 8-K filed December 10, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925037414/ex_897659.htm) |
| 10.33 | [Form of Warrant Amendment dated December 21, 2025 (incorporated by reference to Exhibit 10.1 of the Form 8-K filed December 22, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925038478/ex_901477.htm) |
| 10.34 | [Form of Inducement Letter dated February 19, 2026 (incorporated by reference to Exhibit 10.1 of the Form 8-K filed February 20, 2026)](http://www.sec.gov/Archives/edgar/data/1659617/000143774926004800/ex_922998.htm) |
| 19 | [Moleculin Biotech, Inc. Insider Trading Policy (incorporated by reference to Exhibit 19 of the Form 10-K filed March 21, 2025)](http://www.sec.gov/Archives/edgar/data/1659617/000143774925008751/ex_791681.htm) |
| 21 | [Subsidiaries of the Registrant (incorporated by reference to Exhibit 21 of the Form 10-K filed March 22, 2023)](http://www.sec.gov/Archives/edgar/data/1659617/000143774923007537/ex_448110.htm) |
| 23.1\* | [Consent of Grant Thornton, LLP](ex_892227.htm) |
| 31.1\* | [Certification of Principal Executive Officer Pursuant to Section 302 of Sarbanes- Oxley Act of 2002](ex_892228.htm) |
| 31.2\* | [Certification of Principal Financial Officer Pursuant to Section 302 of Sarbanes-Oxley Act of 2002](ex_892229.htm) |
| 32.1\* | [Certification of Principal Executive Officer Pursuant to Section 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ex_892230.htm) |
| 32.2\* | [Certification of Principal Financial Officer Pursuant to Section 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ex_892231.htm) |
| 97 | [Moleculin Biotech, Inc. Restatement Recoupment Policy (incorporated by reference to Exhibit 97 of the Form 10-K filed March 22, 2024)](http://www.sec.gov/Archives/edgar/data/0001659617/000143774924009044/ex_637480.htm) |

---

---

| | |
|:---|:---|
| 101.INS \* | Inline XBRL Instance Document |
| 101.SCH \* | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL \* | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF \* | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB \* | Inline XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE \* | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |

---

---

| | |
|:---|:---|
| \* | Filed herewith. |
| \*\* | Denotes a management contract or compensatory plan or arrangement. |
| † | Confidential treatment has been granted as to certain portions of this exhibit pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. |
| + | Pursuant to Item 601(b)(10)(iv) of Regulation S-K promulgated by the SEC, certain portions of this exhibit have been redacted. The Company hereby agrees to furnish supplementally to the SEC, upon its request, an unredacted copy of this exhibit. |

---

**ITEM 16. FORM 10-K SUMMARY**

None.

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**SIGNATURES**

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | |
|:---|:---|
| MOLECULIN BIOTECH, INC. | MOLECULIN BIOTECH, INC. |
| By: | /s/ Walter V. Klemp |
|  | Walter V. Klemp, |
|  | Chief Executive Officer and Chairman |

---

Date: March 18, 2026

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant in the capacities and on the dates indicated.

---

| | | |
|:---|:---|:---|
| Signature | Title | Date |
| /s/ Walter V. Klemp | Chief Executive Officer and Chairman | March 18, 2026 |
| Walter V. Klemp | (Principal Executive Officer) |  |
| /s/ Jonathan P. Foster | Executive Vice President and | March 18, 2026 |
| Jonathan P. Foster | Chief Financial Officer |  |
|  | (Principal Financial and Accounting Officer) |  |
| /s/ Robert George | Director | March 18, 2026 |
| Robert George |  |  |
| /s/ Michael Cannon | Director | March 18, 2026 |
| Michael Cannon |  |  |
| /s/ John Climaco | Director | March 18, 2026 |
| John Climaco |  |  |
| /s/ Elizabeth Cermak | Director | March 18, 2026 |
| Elizabeth Cermak |  |  |
| /s/ Joy Yan | Director | March 18, 2026 |
| Joy Yan |  |  |

---

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**Moleculin Biotech, Inc.**

**Index to Consolidated Financial Statements**

---

| | |
|:---|:---|
|  | PAGE |
| [Report of Independent Registered Public Accounting Firm (PCAOB ID Number 248)](#audit) | [68](#audit) |
| [Consolidated Balance Sheets as of December 31, 2025 and 2024](#bal) | [69](#bal) |
| [Consolidated Statements of Operations and Comprehensive Loss for the Years ended December 31, 2025 and 2024](#ops) | [70](#ops) |
| [Consolidated Statements of Cash Flows for the Years ended December 31, 2025 and 2024](#cashflows) | [71](#cashflows) |
| [Consolidated Statements of Stockholders' Equity for the Years ended December 31, 2025 and 2024](#equity) | [72](#equity) |
| [Notes to Consolidated Financial Statements](#notes) | [73](#notes) |

---

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**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** 

Board of Directors and Stockholders

Moleculin Biotech, Inc.

**Opinion on the financial statements** 

We have audited the accompanying consolidated balance sheets of Moleculin Biotech, Inc. (a Delaware corporation) and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, stockholders' equity, and cash flows for each of the two years in the period ended December 31, 2025, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

**Going concern**

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company has incurred an accumulated deficit of $206.0 million since inception and has not generated any revenue from operations. These conditions, along with other matters as set forth in Note 2, raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

**Change in accounting principle**

As discussed in Note 2 to the consolidated financial statements, during the year ended December 31, 2025 the Company changed its accounting policy related to the classification of certain outstanding warrants. The Company retrospectively applied this change by reclassifying certain warrants from liability to equity in the consolidated financial statements for all periods presented.

**Basis for opinion** 

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated 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 in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

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.

**Critical audit matter**

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

*Change in Accounting Policy Related to the Classification of Warrants* 

As described further in Note 2 to the consolidated financial statements, during the year ended December 31, 2025, the Company changed its accounting policy for the classification of certain outstanding warrants. Management concluded that the warrants met the criteria for equity classification under the applicable accounting guidance and, as a result, reclassified the warrants from liability to equity.

The principal consideration for our determination that the change in accounting policy related to the classification of warrants is a critical audit matter is that it involved especially challenging and complex auditor judgement. In particular, the evaluation required significant judgment in assessing management's interpretation and application of the accounting guidance governing the classification of freestanding financial instruments, including the assessment of contractual terms and settlement provisions.

Our audit procedures related to the change in accounting policy for the classification of warrants included the following, among others: (1) we evaluated management's accounting policy memorandum and assessed whether the revised classification of the warrants as equity was appropriate under the applicable accounting guidance, including consideration of relevant interpretive guidance and prevailing practice; (2) we read and analyzed the warrant agreements and related amendments to evaluate contractual provisions affecting classification, including settlement terms, adjustment features, and contingencies; (3) we involved professionals with specialized accounting expertise to assist in evaluating management's conclusions regarding the appropriate classification of the warrants; and (4) we tested the accuracy and completeness of the retrospective adjustments recorded to reclassify the warrants from liability to equity, including recalculation of prior-period balances and the elimination of previously recognized fair value changes.

/s/ GRANT THORNTON LLP

We have served as the Company's auditor since 2017.

Fort Lauderdale, Florida

March 18, 2026

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 68

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**Moleculin Biotech, Inc.**

**Consolidated Balance Sheets**

***(in thousands, except for share and per share data)***

---

| | | |
|:---|:---|:---|
|  | ***December 31,*** | ***December 31,*** |
|  | ***2025*** | ***2024*** |
| **Assets** |  |  |
| Current Assets: |  |  |
| Cash and cash equivalents | $8878 | $4278 |
| Prepaid expenses and other current assets | 808 | 916 |
| Total current assets | 9686 | 5194 |
| Furniture and equipment, net | 78 | 159 |
| Intangible assets | 11148 | 11148 |
| Other non-current assets | 900 |  |
| Operating lease right-of-use asset | 314 | 424 |
| Total Assets | $22126 | $16925 |
| **Liabilities and Stockholders' Equity** |  |  |
| Current Liabilities: |  |  |
| Accounts payable | $3508 | $2030 |
| Accrued expenses and other current liabilities | 3346 | 3329 |
| Total current liabilities | 6854 | 5359 |
| Operating lease liability - long-term, net of current portion | 222 | 358 |
| Warrant liability | 44 |  |
| Total Liabilities | 7120 | 5717 |
| Commitments and contingencies (Note 8) |  |  |
| Stockholders' Equity: |  |  |
| Preferred stock, $0.001 par value; 5,000,000 authorized shares, no shares issued or outstanding |  |  |
| &nbsp;&nbsp;&nbsp; Common stock, $0.001 par value; 500,000,000 and 100,000,000 authorized shares as of December 31, 2025 and December 31, 2024, respectively, 3,199,228 and 135,155 shares issued and outstanding at December 31, 2025 and December 31, 2024, respectively | 3 |  |
| Additional paid-in capital | 220997 | 183693 |
| Accumulated other comprehensive income (loss) | 10 | (41) |
| Accumulated deficit | (206004) | (172444) |
| Total stockholders' equity | 15006 | 11208 |
| Total liabilities and stockholders' equity | $22126 | $16925 |

---

See accompanying notes to these consolidated financial statements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 69

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**Moleculin Biotech, Inc.**

**Consolidated Statements of Operations and Comprehensive Loss**

***(in thousands, except share and per share data)***

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2024*** |
| Revenue | $— | $— |
| Operating expenses: |  |  |
| Research and development | 15891 | 17729 |
| General and administrative | 9122 | 8786 |
| Depreciation and amortization | 90 | 126 |
| Total operating expenses | 25103 | 26641 |
| Loss from operations | (25103) | (26641) |
| Other income: |  |  |
| Gain from change in fair value of warrant liabilities | 24441 |  |
| &nbsp;&nbsp;&nbsp; Loss on issuance of warrant liabilities | (30962) |  |
| &nbsp;&nbsp;&nbsp; Transaction costs allocated to warrant liabilities | (1407) |  |
| &nbsp;&nbsp;&nbsp; Loss on extinguishment of warrant liabilities | (614) |  |
| Other (expense) income, net | (20) | 43 |
| Interest income, net | 105 | 550 |
| Net loss | (33560) | (26048) |
| Warrant deemed dividend | (104) |  |
| Net loss available to common stockholders | $(33664) | $(26048) |
| Net loss per common share - basic and diluted | $(28.42) | $(189.14) |
| Weighted average common shares outstanding, basic and diluted | 1184569 | 137720 |
| Comprehensive loss: |  |  |
| Net loss | $(33560) | $(26048) |
| Other comprehensive loss: |  |  |
| Foreign currency translation | 51 | (32) |
| Comprehensive loss | $(33509) | $(26080) |

---

See accompanying notes to these consolidated financial statements.

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**Moleculin Biotech, Inc.**

**Consolidated Statements of Cash Flows**

***(in thousands)***

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2024*** |
| **Cash flows from operating activities:** |  |  |
| Net loss | $(33560) | $(26048) |
| Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| Depreciation and amortization | 90 | 126 |
| Stock-based compensation | 1664 | 1726 |
| Change in fair value of warrant liabilities | (24441) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss on issuance of warrant liabilities | 30962 |  |
| Transaction costs allocated to warrant liabilities | 1407 |  |
| Loss on extinguishment of warrant liabilities | 614 | *—* |
| Operating lease, net | (26) | 103 |
| Changes in operating assets and liabilities: |  |  |
| Prepaid expenses and other assets | (792) | 1807 |
| Accounts payable | 1330 | (468) |
| Accrued expenses and other liabilities | 17 | (1108) |
| Net cash used in operating activities | (22735) | (23862) |
| **Cash flows from investing activities:** |  |  |
| Purchase of fixed assets |  | (13) |
| Net cash used in investing activities |  | (13) |
| **Cash flows from financing activities:** |  |  |
| Proceeds from sale of common stock, pre-funded and common warrants and warrant inducement, net of issuance and transaction costs | 25765 | 4660 |
| &nbsp;&nbsp;&nbsp; Proceeds from exercise of warrants | 1527 | 1 |
| Payment of tax liability for vested restricted stock units | (8) | (26) |
| Net cash provided by financing activities | 27284 | 4635 |
| Effect of exchange rate changes on cash and cash equivalents | 51 | (32) |
| Net increase (decrease) in cash and cash equivalents | 4600 | (19272) |
| Cash and cash equivalents, at beginning of year | 4278 | 23550 |
| Cash and cash equivalents, at end of year | $8878 | $4278 |
| **Supplemental disclosures of cash flow information:** |  |  |
| **Non-cash investing and financing activities:** |  |  |
| Reclassification of warrant liabilities to equity pursuant to warrant amendments | $16653 | $— |
| Equity warrants issued in relation to liability-classified warrant inducements | $6213 | $— |
| Offering costs included in accounts payable and accrued liabilities | $138 | $— |
| Deemed dividend in connection with warrant amendment | $104 | $— |
| Transaction costs related to the sale of common stock, pre-funded and common warrants | $— | $156 |

---

See accompanying notes to these consolidated financial statements.

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**Moleculin Biotech, Inc.**

**Consolidated Statements of Stockholders' Equity** 

***(in thousands except for shares and per unit)***

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | *Common Stock* | *Common Stock* |  |  |  |  |
|  | *Shares* | *Par Value Amount* | *Additional Paid-In-Capital* | *Accumulated Deficit* | *Accumulated Other Comprehensive Income (Loss)* | *Stockholders' Equity* |
| Balance at December 31, 2023 | 89101 | $— | $177333 | $(146396) | $(9) | $30928 |
| Warrants exercised | 30555 |  |  |  |  |  |
| Issued for cash - sale of common stock, pre-funded and common warrants, net of transaction costs | 11320 |  | 4660 |  |  | 4660 |
| Reverse stock split | 3087 |  |  |  |  |  |
| Common stock issued upon vesting of restricted stock units (net of shares withheld for tax) | 819 |  | (26) |  |  | (26) |
| Issuance of common stock in connection with consulting agreements | 273 |  | 37 |  |  | 37 |
| Stock based compensation | *—* |  | 1689 |  |  | 1689 |
| Cumulative translation adjustment | *—* |  |  |  | (32) | (32) |
| Net loss | *—* |  |  | (26048) |  | (26048) |
| Balance at December 31, 2024 | 135155 | $— | $183693 | $(172444) | $(41) | $11208 |
| Warrant inducement and exercise of common stock warrants, net of transaction costs | 1926121 | 3 | 17471 |  |  | 17474 |
| Warrants exercised | 561982 |  | 548 |  |  | 548 |
| Issued for cash - sale of common stock, pre-funded and common warrants | 444881 |  | 11 |  |  | 11 |
| Issuance of common stock under at-the-market equity program, net of transaction costs | 128234 |  | 965 |  |  | 965 |
| Issuance of common stock in connection with a consulting agreement | 2351 |  |  |  |  |  |
| Common stock issued upon vesting of restricted stock units (net of shares withheld for tax) | 796 |  | (8) |  |  | (8) |
| Reverse stock split | (292) |  |  |  |  |  |
| Reclassification of warrant liabilities to equity pursuant to warrant amendment | *—* |  | 16653 |  |  | 16653 |
| Warrant deemed dividend | *—* |  | 104 |  |  | 104 |
| Deemed dividend in connection with warrant amendment | *—* |  | (104) |  |  | (104) |
| Stock based compensation | *—* |  | 1664 |  |  | 1664 |
| Cumulative translation adjustment | *—* |  |  |  | 51 | 51 |
| Net loss | *—* |  |  | (33560) |  | (33560) |
| Balance at December 31, 2025 | 3199228 | $3 | $220997 | $(206004) | $10 | $15006 |

---

See accompanying notes to these consolidated financial statements.

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**Moleculin Biotech, Inc.**

**Notes to the Consolidated Financial Statements**

***1.* Nature of Business** 

The terms "MBI" or "the Company", "we", "our" and "us" are used herein to refer to Moleculin Biotech, Inc. MBI is a clinical-stage pharmaceutical company, organized as a Delaware corporation in *July 2015.* MBI is a late-stage pharmaceutical development company currently conducting a pivotal Phase *2B/3* trial evaluating Annamycin, also known by its non-proprietary name "naxtarubicin", in combination with cytarabine for the treatment of subjects with relapsed/refractory (R/R) acute myeloid leukemia (AML). The Company has *two* additional portfolios of technologies for hard-to-treat cancers and viruses with clinical and preclinical research funded primarily by investigators at academic institutions.

Each of its three core technologies is based substantially on discoveries at, or in conjunction with and with rights originating from the University of Texas MD Anderson Cancer Center (MD Anderson) in Houston, Texas, and features *one* or more drugs that have successfully completed a Phase *1* clinical trial. Three of its drug candidates have shown human activity in clinical trials and are currently or have been in Phase *1B/2* or Phase *2* clinical trials. Since MBI's inception, its drugs have completed, are in planning, are currently in, or have been permitted to proceed in, *eighteen* clinical trials. Annamycin, in a unique multilamellar lipid formulation, is the Company's lead molecule, and in *2024* MBI has concluded treatment in several Phase *1B/2* clinical trials for treating AML and in *March 2025* began treating subjects in its Phase *2B/3* clinical trial for the treatment of R/R AML. The latter is the main focus the Company's management and resources. Annamycin was in *two* closed or concluded Phase *1B/2* clinical trials for treating Soft Tissue Sarcoma metastasized to the lungs (STS lung metastases, STS lung mets, or Advanced STS), with *one* physician-sponsored. The Company announced in *2025* a physician-sponsored trial for Annamycin for the treatment of pancreatic cancer intended to begin in the *second* half of *2026.* Additionally, there is another phase *1B/2* clinical trial that is physician sponsored which is investigating using *WP1066* in combination with radiation for the treatment of glioblastoma, a form of brain cancer, with another similar trial planned within the next year for pediatric brain tumors.

The physician-sponsored trials utilize primarily external funds, such as grant funds, which are *not* presented in these financial statements. The Company does *not* have manufacturing facilities, and all manufacturing activities are contracted out to *third* parties. Additionally, the Company does *not* have a sales organization. The Company's overall strategy is to seek potential out-licensing or outsourcing opportunities with development/commercialization strategic partners who are better suited for the marketing, sales and distribution of its drugs, if approved.

In *2019,* the Company sublicensed its technologies to Animal Life Sciences, Inc. (ALI), to enable research and commercialization for non-human use and share development data. As part of this agreement, ALI issued to the Company a 10% equity interest in ALI.

On *May 23, 2025,* the Company received a letter from Nasdaq Stock Market LLC notifying the Company that it was *not* in compliance with Nasdaq Listing Rule *5550*(b)(*1*) (the "Equity Rule"), which requires a minimum of *$2.5* million in stockholders' equity. The letter also noted that the Company did *not* meet the alternative compliance standards of market value of listed securities or net income from continuing operations under the Equity Rule. The notification had *no* immediate effect on the listing of the Company's common stock on the Nasdaq Capital Market, and the Company was provided *45* calendar days to submit a plan to regain compliance. The Company's compliance plan was subsequently accepted, and the Nasdaq staff granted an extension of up to 180 calendar days, through *November 19, 2025,* to demonstrate compliance.

On *June 27, 2025,* the Company received an additional deficiency letter from the staff of Nasdaq indicating that, for the previous *30* consecutive business days, the closing bid price of the Company's common stock had been below the minimum $1.00 per share requirement for continued listing on the Nasdaq Capital Market pursuant to Nasdaq Listing Rule *5550*(a)(*2*) (the "Bid Price Rule").

On *November 20, 2025,* the Company received a delisting determination letter from Nasdaq stating that the Company had *not* regained compliance with the Equity Rule within the permitted timeframe. The Company subsequently requested a hearing before a Nasdaq hearing panel (the "Panel") to appeal the delisting determination.

On *December 15, 2025,* the Company received a letter from Nasdaq confirming that the Company had regained compliance with the Bid Price Rule because the closing bid price of the Company's common stock was $1.00 per share or greater for the *10* consecutive business days from *December 1, 2025* through *December 12, 2025.* Accordingly, this matter was closed.

On *January 6, 2026,* Nasdaq informed the Panel that the Company had regained compliance with the Equity Rule and that the Company was in compliance with all applicable continued listing standards. As a result, the hearing before the Panel was cancelled.

***2.* Basis of presentation, principles of consolidation and significant accounting policies** 

**Reverse Stock Split -** On *December 1, 2025,* pursuant to authority granted by our stockholders, the Company effected a *1*-for-25 reverse stock split of our common stock and the filing of an amendment to our amended and restated certificate of incorporation to effectuate the reverse stock split. The amendment provides that, every *twenty-five* shares of our issued and outstanding common stock will automatically be combined into *one* issued and outstanding share of common stock, without any change in par value per share, which will remain at *$0.001.* The accompanying consolidated financial statements and notes to the consolidated financial statements give retroactive effect to the reverse stock split for all periods presented. Certain amounts in the financial statements, the notes thereto, and elsewhere in the Form *10*-K *may* be slightly different than previously reported due to rounding up of fractional shares as a result of the reverse stock split.

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**Change in Accounting Policy** – During the year ended *December 31, 2025,* the Company changed its accounting policy related to the classification of certain outstanding warrants. Prior to the change in accounting policy, the Company's policy was to account for warrants with a certain contingent settlement provision as liability warrants, initially measuring them at fair value on the date of issuance. The warrants were previously remeasured at fair value at the end of each reporting period, with the related liability reflected on the Company's balance sheet. The changes in fair value during each previous reporting period were recognized as a gain (loss) from change in fair value of warrant liability in the Company's condensed consolidated statement of operations. The Company changed its policy and warrants that contain this certain contingent settlement provision are now accounted for as equity under ASC *815*-*40*-*15*-*7C* through *15*-*7F* and ASC *505.* The Company concluded that accounting for its warrants as equity instruments is preferable under ASC *250,* as equity classification better reflects the economic substance of the arrangement and enhances the clarity and consistency of the Company's financial reporting. As a result of this change in accounting policy, all warrants issued prior to *2025,* and certain warrants issued in *2025,* that were previously accounted for as liability awards due to the certain contingent settlement provision now meet the equity classification criteria under ASC *815*-*40* and are classified as equity instruments. The effects of the change in accounting policy from warrant liabilities to equity have been retrospectively applied to all periods presented in these consolidated financial statements. Subsequent to the change in accounting policy, certain warrants will continue to be classified as liabilities, as these instruments contain features other than the certain contingent settlement provision that previously resulted in liability classification, which preclude equity classification under applicable accounting guidance. See also Note *5* - *Warrants and Equity*.

As a result of the change in accounting policy, the Company adjusted accumulated deficit, and additional paid-in capital to reverse previously recorded mark-to-market fair value changes of the liability-classified warrants. Accumulated deficit as of *January 1, 2024,* changed from $131.6 million, as reported under the liability classification, to $146.4 million under the equity classification.

The following financial statement line items were impacted by the change in accounting policy, as shown in the table below (in thousands, except for net loss per common share):

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| | | | |
|:---|:---|:---|:---|
|  | ***December 31, 2024*** | ***December 31, 2024*** | ***December 31, 2024*** |
|  | ***As Reported*** | ***As Adjusted*** | ***Effect of*** |
|  | ***Under Old Policy*** | ***Under New Policy*** | ***Change*** |
| **Consolidated Balance Sheets** |  |  |  |
| Warrant liability | $5229 | $— | $(5229) |
| Total liabilities | 10946 | 5717 | (5229) |
| Additional paid-in capital | 159387 | 183693 | 24306 |
| Accumulated deficit | (153367) | (172444) | (19077) |
| Total stockholders' equity | 5979 | 11208 | 5229 |
| Total liabilities and stockholders' equity | $16925 | $16925 | $- |

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| | | | |
|:---|:---|:---|:---|
|  | ***Year Ended*** | ***Year Ended*** | ***Year Ended*** |
|  | ***December 31, 2024*** | ***December 31, 2024*** | ***December 31, 2024*** |
|  | ***As Reported*** | ***As Adjusted*** | ***Effect of*** |
|  | ***Under Old Policy*** | ***Under New Policy*** | ***Change*** |
| **Consolidated Statement of Operations** |  |  |  |
| Gain from change in fair value of warrant liability | $6125 | $*—* | $6125 |
| Transaction costs allocated to warrant liabilities | (993) | *—* | (993) |
| Loss on issuance of warrant liabilities | (847) | *—* | (847) |
| Net loss | (21763) | (26048) | 4285 |
| Net loss per common share - basic and diluted | (158.02) | (189.14) | 31.12 |
| Other comprehensive income | $(21795) | $(26080) | $4285 |

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| | | | |
|:---|:---|:---|:---|
|  | ***Year Ended*** | ***Year Ended*** | ***Year Ended*** |
|  | ***December 31, 2024*** | ***December 31, 2024*** | ***December 31, 2024*** |
|  | ***As Reported*** | ***As Adjusted*** | ***Effect of*** |
|  | ***Under Old Policy*** | ***Under New Policy*** | ***Change*** |
| **Consolidated Statement of Cash Flows** |  |  |  |
| Net loss | $(21763) | $(26048) | $4285 |
| Adjustments to reconcile net loss to net cash used in operating activities |  |  |  |
| Change in fair value of warrant liability | (6125) |  | (6125) |
| Loss on issuance of warrant liabilities | 847 |  | 847 |
| Transaction costs allocated to warrant liabilities | 993 |  | 993 |
| Net cash used in operating activities | $(23862) | $(23862) | $— |

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**Basis of Presentation -** The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (US GAAP), and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the SEC).

**Principles of consolidation** - The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. All material long-lived assets of the Company reside in the United States. In accordance with FASB ASC Topic *280,* Segment Reporting, the Company views its operations and manages its business as *one* segment. As a result, the financial information disclosed herein represents all of the material financial information related to its principal operating segment.

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**Segment Information** - Management has determined that the Company operates in one reportable segment, which is the development and commercialization of drug products. The Company's chief operating decision maker (CODM) is its Chief Executive Officer and Chairman, who reviews financial information presented on a consolidated basis. The CODM primarily uses consolidated net loss, which is also reported on the Consolidated Statements of Operations and Comprehensive Loss as net loss, to assess financial performance and allocate resources. These financial metrics are used by the CODM to make key operating decisions, such as the assessment of segment performance and allocation of resources. The significant expense categories within net loss from operations that the CODM regularly reviews are research and development expenses, general and administrative expenses, and depreciation and amortization. The significant expense categories and subcategories are reported on the Consolidated Statements of Operations and Comprehensive Loss. Other expenses included in the Company's net loss include change in fair value of warrant liabilities, other income (expense), interest income, net, and any additional non-operating expenses that are reported on the Consolidated Statements of Operations and Comprehensive Loss.

**Use of Estimates -** The preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. Management considers many factors in selecting appropriate financial accounting policies and controls, and in developing the estimates and assumptions that are used in the preparation of these financial statements. Management must apply significant judgment in this process. In addition, other factors *may* affect estimates, including expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates, and whether historical trends are expected to be representative of future trends. The estimation process often *may* yield a range of potentially reasonable estimates of the ultimate future outcomes and management must select an amount that falls within that range of reasonable estimates. This process *may* result in actual results differing materially from those estimated amounts used in the preparation of financial statements. Estimates are used in the following areas, among others: fair value estimates on intangible assets, warrants, and stock-based compensation expense, as well as accrued expenses and taxes.

**Going Concern and Liquidity** - These consolidated financial statements have been prepared on a going concern basis, which assumes the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent upon the ability of the Company to obtain necessary financing to continue operations and the attainment of profitable operations. As of *December 31, 2025,* the Company had an accumulated deficit of $206.0 million since inception and had *not* yet generated any revenues from operations. Additionally, management anticipates that its cash on hand of $8.9 million as of *December 31, 2025*, along with $8.3 million in gross proceeds via our financing activities during the *first* quarter of *2026,* is *not* sufficient to fund its planned operations for a period of at least *one* year from when these consolidated financial statements are issued. These factors raise substantial doubt regarding the Company's ability to continue as a going concern. These consolidated financial statements do *not* include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company intends to seek additional funding through *one* or more of the following: a combination of equity offerings, debt financings, government or other *third*-party funding, commercialization, marketing and distribution arrangements, other collaborations, strategic alliances and licensing arrangements and delay planned cash outlays or a combination thereof. There can be *no* assurance that such events or a combination thereof can be achieved.

**Cash and Cash Equivalents -** Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents. The Company maintains cash accounts principally at *one* financial institution in the US, which at times, *may* exceed the Federal Deposit Insurance Corporation's limit of *$250,000.* The Company considers all highly liquid accounts with original maturities of *three* months or less to be cash equivalents. The Company has *not* experienced any losses from cash balances in excess of the insurance limit. The Company's management does *not* believe the Company is exposed to significant credit risk at this time due to the financial condition of the financial institution where its cash is held.

**Prepaid Expenses and Other Current Assets -** Prepaid expenses and other current assets consist of the following (in thousands):

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| | | |
|:---|:---|:---|
|  | ***December 31,*** | ***December 31,*** |
|  | ***2025*** | ***2024*** |
| Prepaid insurance | $512 | $554 |
| Vendor prepayments and deposits | 278 | 331 |
| Prepaid sponsored research | 11 | 11 |
| Non-trade receivables | 7 | 20 |
| Total prepaid expenses and other current assets | $808 | $916 |

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**Furniture and equipment -** Furniture and equipment are recorded at cost and depreciated over their estimated useful lives using the straight-line depreciation method as follows:

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| | | |
|:---|:---|:---|
|  | ***Years*** | ***Years*** |
| Leasehold improvements | *Shorter of estimated useful lives or the term of the lease* | *Shorter of estimated useful lives or the term of the lease* |
| Computer equipment |  | 2 |
| Software |  | 3 |
| Machinery and equipment |  | 2 to 5 |
| Furniture and office equipment |  | 2 to 7 |

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Depreciation expense was $0.1 million for each of the years ended *December 31, 2025* and *2024.* Accumulated depreciation was $1.1 million and $1.0 million as of *December 31, 2025* and *2024,* respectively.

**Intangible assets -** Intangible assets with finite lives are amortized using the straight-line method over their estimated period of benefit. Acquired intangible assets identified as in-process research and development (IPR&D) assets, are considered indefinite lived until the completion or abandonment of the associated research and development efforts. If the associated research and development effort is abandoned, the related IPR&D assets will be written-off and the Company will record a noncash impairment loss on its statements of operations. For those compounds that reach commercialization, the IPR&D assets will be amortized over their estimated useful lives. Intangible assets are tested for impairment on an annual basis, and between annual tests if indicators of potential impairment exist, using a fair-value-based approach. The Company evaluates the recoverability of intangible assets periodically and takes into account events or circumstances that warrant revised estimates of useful lives or that indicate that impairment exists. *No* impairments of intangible assets have been identified during any of the periods presented.

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**Other non-current assets -** In *May 2025,* the Company provided a $0.9 million deposit in connection with the MB-*108* clinical trial, a Phase *2B/3* pivotal study evaluating treatment for relapsed or refractory acute myeloid leukemia in the *second*-line setting. This deposit is expected to be held as a prepayment through the anticipated completion of the study in *2029* and, accordingly, has been classified as a non-current asset.

**Operating Lease Right-of-Use Asset -** The Company determines if an arrangement is a lease at contract inception or during modifications or renewal of an existing lease. Operating lease assets represent the Company's right to use an underlying asset for the lease term and operating lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the commencement date of the lease based upon the present value of lease payments over the lease term. The lease payments used to determine the Company's operating lease assets *may* include lease incentives, stated rent increases and escalation clauses linked to rates of inflation when determinable and are recognized in the Company's operating lease assets in the Company's consolidated balance sheet. The Company has elected the practical expedient and does *not* separate lease components from nonlease components for its leases. The Company's operating leases are reflected in operating lease right-of-use asset (ROU), accrued expenses and other current liabilities, and operating lease liability - long-term in the Company's consolidated balance sheets. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Short-term leases, defined as leases that have a lease term of *12* months or less at the commencement date, are excluded from this treatment and are recognized on a straight-line basis over the term of the lease. Refer to Note *8* - Commitments and Contingencies - Lease Obligations Payable for additional information related to the Company's operating leases.

**Sublicense Arrangement -** The Company has a sublicense arrangement which consists of an investment in ALI in which it does *not* have the ability to exercise significant influence over its operating and financial activities. Management evaluates this investment for possible impairment quarterly.

**Fair Value of Financial instruments -**The Company's financial instruments consist primarily of non-trade receivables, accounts payable, accrued expenses, and a warrant liability. The carrying amounts of non-trade receivables, accounts payable, and accrued expenses approximate their fair values due to the short-term maturities of these instruments. The Company's financial assets and liabilities measured at fair value on a recurring basis include the fair value of its warrant liability, which is discussed further in Note *5.*

The Company has categorized its assets and liabilities that are valued at fair value on a recurring basis into *three*-level fair value hierarchy in accordance with US GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an 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 fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets and liabilities (Level *1*) and lowest priority to unobservable inputs (Level *3*).

Assets and liabilities recorded in the balance sheets at fair value are categorized based on a hierarchy of inputs as follows:

Level *1* – Unadjusted quoted prices in active markets of identical assets or liabilities.

Level *2* – Quoted prices for similar assets or liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument.

Level *3* – Unobservable inputs for the asset or liability.

The following table provides the financial assets and liabilities reported at fair value and measured on a recurring basis at *December 31, 2025* and *2024* (in thousands):

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| | | | | |
|:---|:---|:---|:---|:---|
| **Description** | ***Liabilities Measured at Fair Value*** | ***Quoted Prices in Active Markets for Identical Assets (Level 1)*** | ***Significant Other Observable Inputs (Level 2)*** | ***Significant Other Unobservable Inputs (Level 3)*** |
| Fair value of warrant liability: |  |  |  |  |
| December 31, 2025 | $44 | $— | $— | $44 |
| December 31, 2024 | $— | $— | $— | $— |

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The following table provides a summary of changes in fair value associated with the Level *3* liabilities for the years ended *December 31, 2025* and *2024* (in thousands):

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| | |
|:---|:---|
|  | ***Warrant Liability Long-Term*** |
| December 31, 2023 | $— |
| Issuances of warrants |  |
| Change in fair value - net |  |
| December 31, 2024 | $— |
| Issuances of warrants | 46737 |
| Change in fair value - net | (24441) |
| &nbsp;&nbsp;&nbsp; Loss on extinguishment of warrant liabilities | 614 |
| Equity warrants issued in relation to liability-classified warrant inducement | (6213) |
| &nbsp;&nbsp;&nbsp; Reclassification of warrant liabilities to equity pursuant to warrant amendment | (16653) |
| December 31, 2025 | $44 |

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The table above presents a rollforward of the Company's Level *3* liabilities, beginning with the fair value as of *December 31, 2023* and reflecting changes in fair value and other activity during the years ended *December 31, 2025* and *2024.* The ending balance of these Level *3* financial instruments represents management's estimate of fair value at the respective reporting date. Because these instruments are *not* actively traded, their valuations are based on significant unobservable inputs and are *not* derived from observable market prices. Accordingly, the estimated values *may* differ from amounts that could be realized in an immediate settlement.

The Company estimates the fair value of its outstanding warrant liabilities using a Monte Carlo simulation model, as the warrants provide holders with the right, but *not* the obligation, to purchase the Company's common stock at a contractual exercise price. This valuation technique incorporates significant unobservable inputs, including the Company's stock price, expected volatility, the risk-free interest rate, and the expected term at each measurement date. Accordingly, the warrant liabilities are classified within Level *3* of the fair value hierarchy.

The valuation of these instruments is inherently subjective and involves the use of significant estimates and assumptions. Changes in these inputs, including those resulting from factors outside of the Company's control, such as market conditions or a potential change in control, could result in significant fluctuations in the estimated fair value of the warrant liabilities. Such changes *may* result in material non-cash gains or losses recognized in the Company's statements of operations in future periods.

**Income Taxes -** The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and the tax bases of reported assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company must then assess the likelihood that the resulting deferred tax assets will be realized. A valuation allowance is provided when it is more likely than *not* that some portion or all of a deferred tax asset will *not* be realized.

The Company accounts for uncertain tax positions in accordance with the provisions of ASC *740*-*10* which prescribes a recognition threshold and measurement attribute for financial statement disclosure of tax positions taken, or expected to be taken, on its tax return. The Company evaluates and records any uncertain tax positions based on the amount that management deems is more likely than *not* to be sustained upon examination and ultimate settlement with the tax authorities in the tax jurisdictions in which it operates.

**Translation of Foreign Currencies** - The functional currency for the Company's foreign subsidiaries is the local currency. For the Company's non-US subsidiaries that transact in a functional currency other than the US dollar, assets and liabilities are translated at current rates of exchange at the balance sheet date. Income and expense items are translated at the average foreign currency rates for the period. Adjustments resulting from the translation of the financial statements of the Company's foreign operations into US dollars are excluded from the determination of net income and are recorded in accumulated other comprehensive income, a separate component of equity.

**Stock-based Compensation -** Stock-based compensation expense includes the estimated fair value of equity awards vested or expected to vest during the reporting period. The Company accounts for its stock-based compensation awards in accordance with FASB ASC Topic *718,* Compensation—Stock Compensation (ASC *718*). ASC *718* requires all stock-based payments to employees, including grants of employee stock options, restricted stock units, modifications to existing stock options, and equity classified warrants to be recognized in the consolidated statements of operations based on their grant date fair values. The grant-date fair value of stock options is estimated using the Black-Scholes option pricing model. The grant-date fair value of restricted stock awards is determined based on the closing price of the Company's common stock on the date of grant (or, if the grant date is *not* a business day, the closing price on the preceding business day). The grant-date fair value of equity-classified warrants is estimated using a Monte Carlo simulation model, which incorporates significant assumptions, including expected volatility, expected term, risk-free interest rate, and the contractual terms of the warrants, including potential path-dependent features. The awards are subject to service vesting conditions. Compensation expense related to stock-based awards with service-based vesting conditions is recognized on a straight-line basis over the requisite service period of the award, which is generally the vesting period, based on the grant-date fair value of the award. The Company recognizes forfeitures as they occur. Compensation expense related to stock-based awards with performance-based vesting conditions is recognized based on the grant-date fair value of the award when it is probable that the performance condition will be achieved and is adjusted for changes in the probability of achievement until the performance condition is satisfied

**Net Loss Available to Common Stockholders -** Basic net loss per common share is computed by dividing net loss available to common shareholders by the weighted-average number of common shares outstanding during the period. For purposes of this calculation, options to purchase common stock, restricted stock units subject to vesting and warrants to purchase common stock were considered to be common stock equivalents. Shares of the Company's common stock underlying pre-funded warrants are included in the calculation of basic and diluted earnings per share. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, the weighted-average number of common shares outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive. For the years ended *December 31, 2025,* and *2024,* approximately 2.6 million and 0.4 million (taking into account the reverse stock splits we have completed) of potentially dilutive shares were excluded from the computation of diluted loss per share due to their antidilutive effect.

**Research and Development Costs -** Research and development costs are expensed as incurred. These costs consist primarily of salaries and benefits of research and development personnel, costs related to research activities, preclinical studies, clinical trials, drug manufacturing and allocated overhead and facility-related expenses.

**Subsequent Events** - The Company's management reviewed all material events through the date these consolidated financial statements were issued for subsequent event disclosure consideration as described in Note *9* and elsewhere in other notes to the financial statements.

**Recent Accounting Pronouncements** 

In *December 2025,* the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) *2025*-*11,* Interim Reporting (Topic *270*): Narrow-Scope Improvements. The ASU clarifies the applicability of interim reporting guidance, the form and content of interim financial statements, and the related disclosure requirements. The amendments are intended to improve the organization and consistency of interim reporting guidance and do *not* change the fundamental nature of interim reporting or expand or reduce existing disclosure requirements. The ASU is effective for interim reporting periods within fiscal years beginning after *December 15, 2027,* with early adoption permitted. The Company is currently evaluating the impact of adopting this guidance; however, the Company does *not* expect the adoption of this standard to have a material impact on its consolidated financial statements.

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In *November 2024* and *January 2025,* FASB issued ASU *2024*-*03* and ASU *2025*-*01,* Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic *220*-*40*): Disaggregation of Income Statement Expenses, which requires disclosure in the notes to the financial statements of specified information about certain costs and expenses. The amendments to the standards are effective for fiscal years beginning after *December 15, 2026,* and for interim periods within fiscal years beginning after *December 15, 2027.* Early adoption is permitted. The amendments should be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the new guidance to determine the impact it *may* have on its consolidated financial statements and related disclosures, but expects additional disclosures upon adoption.

In *December 2023,* the FASB issued Accounting Standards Update, or ASU *2023*-*09,* Income Taxes (Topic *740*): Improvements to Income Tax Disclosures. ASU *2023*-*09* improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. This guidance is effective for the annual periods beginning after the year ended *December 31, 2024.* The Company adopted ASU *2023*-*09* as of *January 1, 2025,* and it has included the necessary disclosures in this Annual Report on Form *10*-K.

There are *no* other effective pronouncements, or pronouncements issued but *not* yet effective, which if adopted, would have a material effect on the accompanying financial statements.

***3.* Intangible Assets**

In conjunction with its acquisition of Moleculin, LLC in *2016,* the Company recognized an intangible asset for acquired in-process research and development (IPR&D) related to the acquired *WP1066* portfolio. As the Company's *WP1066* portfolio is currently in development, the Company's IPR&D intangible asset will *not* be amortized until development is complete. If the associated research and development effort is abandoned, the Company's IPR&D intangible asset will be written-off and the Company will record a noncash impairment loss on its statements of operations. For those compounds that reach commercialization, the IPR&D assets will be amortized over their estimated useful lives. IPR&D was $11.1 million as of *December 31, 2025* and *2024*, respectively.

***4.* Accrued expenses and other current liabilities**

Accrued expenses and other current liabilities at *December 31, 2025* and *2024* consist of the following components (in thousands):

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| | | |
|:---|:---|:---|
|  | ***December 31,*** | ***December 31,*** |
|  | ***2025*** | ***2024*** |
| Accrued payroll and bonuses | $1821 | $1817 |
| Accrued research and development | 1117 | 988 |
| Accrued legal, regulatory, professional and other | 271 | 404 |
| Operating lease liability - current | 137 | 120 |
| Total accrued expenses and other current liabilities | $3346 | $3329 |

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***5.* Warrants and Equity**

**Warrant and Stock Issuances** 

On *December 21, 2025,* the Company entered into separate warrant amendment agreements (collectively, the "Warrant Amendment") with the holders of its Series E, Series F, and Series G warrants (each as defined below, and collectively, the "Warrants"). Pursuant to the Warrant Amendment, the exercise prices of the Warrants were reduced to $3.90 per share (which were subsequently further adjusted as described in Note *9* below). In addition, the Series E and Series F warrants were amended to eliminate certain price adjustment provisions and to revise the definition of "Black-Scholes Value". The revised definition of Black-Scholes Value modified the expected volatility input used in the Black-Scholes option pricing model by eliminating the use of *30*-day and *365*-day historical volatility measures and limiting the volatility input to the greater of (i) *100*-day historical volatility, as obtained from Bloomberg, or (ii) *100%.* All other inputs to the Black-Scholes model, including the risk-free interest rate, underlying stock price, expected term, and cost of borrowing, remained unchanged. As a result of the Warrant Amendment, the Company determined that the Series E and Series F warrants qualified for equity classification prospectively under applicable accounting guidance. Accordingly, upon the effectiveness of the Warrant Amendment, the Series E and Series F warrants were reclassified from liability to equity. In connection with the reclassification, the Company remeasured the Series E and Series F warrant liabilities to fair value immediately prior to reclassification, resulting in the recognition of a $24.4 million gain in the consolidated statement of operations. The Company then reclassified approximately $16.0 million of Series E and Series F warrant liabilities to additional paid-in capital. In addition, the Company recorded a loss on extinguishment of warrant liabilities of $0.6 million and a warrant-related deemed dividend of $0.1 million, which was recorded within additional paid-in capital and recognized as a reduction to income available to common stockholders.

On *December 9, 2025,* the Company entered into warrant exercise inducement agreements with holders of certain outstanding Series C, Series D and Series F warrants, pursuant to which such holders agreed to exercise warrants to purchase an aggregate of 1,044,329 shares of the Company's common stock at reduced or existing exercise prices in exchange for the issuance of Series G warrants to purchase up to 2,610,823 shares of common stock, representing 250% of the shares underlying the exercised warrants, with a five-year exercise term. The Company received gross proceeds of approximately $6.8 million from the warrant exercises. Pursuant to ASC *815,* and in accordance with the Company's accounting policy, the Company determined that Series G warrants met the criteria for equity classification as of their issuance date.

In *August 2025,* the Company entered into a warrant exercise inducement offer letter with holders of certain existing warrants pursuant to which the holders agreed to exercise Series E warrants to purchase up to 648,649 shares of common stock with an exercise price of $9.25 per share in exchange for the Company issuing new Series F warrants to purchase 2,594,595 shares of the Company's common stock. Each Series F warrant had an exercise price of $13.75 per share and is exercisable as of the date of issuance to *October 16, 2030.* The Company received gross proceeds of $6.0 million. In addition, during *August* and *September 2025,* 119,848 shares of Series E warrants were exercised for $1.1 million. Upon issuance the Series F warrants were initially classified as liability warrants. Pursuant to the Warrant Amendment described above, the Series F warrants were equity-classified as of *December 21, 2025.*

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In *June 2025,* the Company closed a public offering of (i) 398,881 shares of the Company's common stock; (ii) pre-funded warrants to purchase up to an aggregate of 244,319 shares of common stock; and (iii) Series E warrants to initially purchase up to an aggregate of 1,929,600 shares of common stock (of which Series E warrants to purchase 649,649 shares of common stock were exercised as described in the above paragraph). The combined purchase price for the securities was $9.25 per share of common stock (or pre-funded warrant in lieu thereof). Each pre-funded warrant was exercisable for *one* share of common stock at an exercise price of $0.025 per share. All of the pre-funded warrants were exercised during the *three* months ended *June 30, 2025.* Each Series E warrant had an initial exercise price of $9.25 per share (which was subsequently adjusted as described in Note *9* below) and became exercisable beginning on the effective date of stockholder approval on *August 18, 2025,* at the Company's Annual Meeting. The Company also received approval at the Annual Meeting to increase its authorized shares of common stock to 500,000,000, such that it can issue all shares of common stock required under the Series E warrants upon any future adjustments to the exercise price of the Series E warrants. The Series E warrants provide that if, while the Series E warrants are outstanding, the Company sells any common stock and/or common stock equivalents other than in connection with certain exempt issuances (as defined in the Series E warrant agreement), at a purchase price per share less than the exercise price of the Series E warrants in effect immediately prior to such sale, then immediately after such sale the exercise price of the Series E warrants then in effect will be reduced to an amount equal to such new issuance price, and, the number of shares issuable upon exercise of the Series E warrants will be proportionately adjusted such that the aggregate price will remain unchanged, subject to the floor price of $3.00 (Down Round Feature). The Series E warrants expire on *August 18, 2030.* As of *November 10, 2025,* the Company had received gross proceeds of $7.5 million and *may* receive up to an additional approximately $10.3 million in gross proceeds if the Series E warrants are fully exercised for cash. Proceeds of offerings are allocated between common shares and Series E warrants *first* by allocating to the Series E warrants classified as a liability based on their fair value and then allocating the residual to the equity instruments, which would include pre-funded warrants. The fair value of the Series E warrants was $16.3 million on the issuance date. Because the fair value of the liability classified warrants issued in the *June 2025* offering exceeded the total proceeds, *no* consideration was allocated to the common stock or pre-funded warrants. The full proceeds from the *June 2025* offering were recorded as warrant liabilities, and the Company recognized a $10.4 million loss on the issuance of the Series E warrants. The Company also incurred $1.2 million in transaction costs related to the *June 2025* public offering. Pursuant to the Warrant Amendment, 2,628,175 of the Company's 2,642,420 outstanding Series E warrants were reclassified from warrant liabilities to equity as of *December 21, 2025.*

In *February 2025,* the Company entered into a securities purchase agreement with an institutional investor for the sale by the Company of 46,000 shares of common stock, and 84,841 pre-funded warrants to purchase shares of common stock, and Series D warrants to purchase up to 261,722 shares of common stock. The combined purchase price for the securities was $26.75 per share of common stock (or pre-funded warrant in lieu thereof). Each pre-funded warrant was exercisable for *one* share of common stock at an exercise price of $0.025 per share. All of the pre-funded warrants were exercised during the *three* months ended *March 31, 2025.* Each Series D warrant will expire five years from the initial exercise date. The Company received gross proceeds of $3.5 million. Based on the change in accounting policy as noted in Note *2,* these Series D warrants are classified within equity for all periods presented within these consolidated financial statements.

In *February 2025,* the Company entered into a warrant exercise inducement offer letter with a holder of certain existing warrants to receive new warrants to purchase up to a number of shares of common stock equal to *200%* of the number of warrant shares issued pursuant to the exercise of such existing warrants to purchase up to 233,143 shares of common stock pursuant to which the holder agreed to exercise for cash their existing warrants at a reduced exercise price of $25.00 in exchange for the Company's agreement to issue the inducement warrants to purchase up to 466,286 shares (Series C warrants) of the Company's common stock. Each Series C warrant had an exercise price of $18.75 and was exercisable as of the date of issuance and *may* be exercised for a period of five years. The Company received gross proceeds of $5.8 million. Total gross proceeds received in the *two February 2025* transactions were $9.3 million. Based on the change in accounting policy as noted in Note *2,* these Series C warrants are classified within equity for all periods presented within these consolidated financial statements.

**Other Components of Equity and Share Issuances**

During the years ended *December 31, 2025* and *2024,* the Company issued 2,351 and 273 shares of common stock, respectively, to consultants for services provided and 796 and 819 shares, respectively, upon the vesting of restricted stock units ("RSUs"). In *February 2026,* the Company issued 1,997 shares of common stock upon the vesting of RSUs that vested during the *fourth* quarter of *2025.*

**Preferred Stock**

The Company's certificate of incorporation authorizes the Company to issue these shares in *one* or more series, to determine the designations and the powers, preferences and relative, participating, optional or other special rights and the qualifications, limitations and restrictions thereof, including the dividend rights, conversion or exchange rights, voting rights (including the number of votes per share), redemption rights and terms, liquidation preferences, sinking fund provisions and the number of shares constituting the series. *No* preferred stock was issued or outstanding as of *December 31, 2025*.

**At Market Issuance Sales Agreement (ATM)**

On *December 31, 2025,* the Company increased the maximum aggregate gross sales price of the Company's common stock that *may* be offered, issued and sold under a certain At Market Offering Agreement (*2025* ATM Agreement) with Roth Capital Partners, LLC (Roth), which the Company initially entered into in *July 2025,* from $6.5 million to $8.2 million. Pursuant to the terms of the *2025* ATM Agreement, the Company *may* offer and sell shares of its common stock having an aggregate offering price of up to $8.2 million from time to time through or to Roth, acting as sales agent or principal. Roth *may* sell shares of the Company's common stock in negotiated transactions at market prices prevailing at the time of sale or at prices related to such prevailing market prices, and either party *may* terminate the *2025* ATM Agreement upon *two* business days' notice.

The Company has agreed to pay Roth a commission equal to 3.0% of the gross proceeds from any shares of common stock sold under the *2025* ATM Agreement, in addition to reimbursing certain expenses. The *2025* ATM Agreement will terminate upon the sale of shares having an aggregate offering price equal to the maximum amount authorized under the agreement. During the *fourth* quarter of *2025,* the Company sold 1,130,420 shares of common stock pursuant to the *2025* ATM Agreement for gross proceeds of approximately $1.1 million.

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**Warrant Background**

Upon its issuance of warrants to purchase shares of common stock, the Company evaluates the terms of the warrant issue to determine the appropriate accounting and classification of the warrant issue pursuant to FASB ASC Topic *480,* Distinguishing Liabilities from Equity, FASB ASC Topic *505,* Equity, FASB ASC *815,* Derivatives and Hedging, and ASC *718,* Compensation - Stock Compensation. Warrants that meet the criteria for liability classification under ASC *480,* or that do *not* meet the criteria for equity classification under ASC *815* due to exercise contingencies, settlement provisions, or other contractual terms, are accounted for as derivative liabilities.

Liability classified warrants are measured at fair value on the date of issuance and remeasured at fair value at each reporting date in accordance with FASB ASC *820,* Fair Value Measurement (ASC *820*), and are presented as warrant liabilities on the Company's consolidated balance sheet. Changes in the fair value of warrant liabilities are recognized as gains or losses from changes in fair value of warrant liabilities in the Company's consolidated statement of operations.

Equity-classified warrants issued to non-employees in exchange for services are accounted for in accordance with ASC *718,* which requires stock-based compensation to be recognized in the consolidated statements of operations based on the warrants' grant-date fair value. For further information, see Note *2,* Basis of Presentation, Principles of Consolidation and Significant Accounting Policies—Stock-Based Compensation.

At *December 31, 2025* and *2024*, the Company has the following warrants outstanding:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | ***Number of Shares Under Outstanding Warrants at December 31, 2025*** | ***Number of Shares Under Outstanding Warrants at December 31, 2024*** | ***Weighted Average Exercise Price at December 31, 2025*** | ***Remaining Contractual Life at December 31, 2025 (Years)*** |
| **Liability Classified Warrants <sup>(1)</sup>** |  |  |  |  |
| Issued June 2025 | 14240 |  | $3.90 | 4.6 |
| Balance outstanding | 14240 |  | $3.90 | 4.6 |
| **Equity Classified Warrants** |  |  |  |  |
| Issued February 2020 |  | 2707 | $*-* | *-* |
| Issued December 2020 |  | 22 | *-* | *-* |
| Issued April 2021 | 191 | 191 | 1361.25 | 0.3 |
| Issued August 2021 | 667 | 667 | 1155.00 | 5.6 |
| Issued June 2022 | 134 | 134 | 558.75 | 6.5 |
| Issued September 2022 | 667 | 667 | 465.00 | 6.7 |
| Issued June 2023 | 401 | 401 | 225.00 | 7.5 |
| Issued August 2023 | 267 | 267 | 232.50 | 7.6 |
| Issued December 2023 | 1743 | 37573 | 240.00 | 3.0 |
| Issued March 2024 | 134 | 134 | 228.75 | 8.2 |
| Issued August 2024 | 4936 | 268202 | 69.68 | 3.6 |
| Issued October 2024 | 1440 | 1440 | 59.00 | 8.8 |
| &nbsp;&nbsp;&nbsp; Issued January 2025 | 4000 |  | 41.00 | 9.0 |
| Issued February 2025 | 18206 |  | 32.03 | 4.1 |
| &nbsp;&nbsp;&nbsp; Issued June 2025 | 2628180 |  | 3.90 | 4.6 |
| &nbsp;&nbsp;&nbsp; Issued July 2025 | 8000 |  | 13.75 | 9.5 |
| Issued August 2025 | 2278237 |  | 10.87 | 4.8 |
| &nbsp;&nbsp;&nbsp; Issued September 2025 | 14000 |  | 10.75 | 9.7 |
| &nbsp;&nbsp;&nbsp; Issued November 2025 | 16000 |  | 12.25 | 9.9 |
| &nbsp;&nbsp;&nbsp; Issued December 2025 | 2610823 |  | 3.90 | 4.9 |
|  | 7588026 | 312405 | $6.44 |  |
| **Balance outstanding** | **7602266** | **312405** | $**6.43** |  |

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<sup>(*1*)</sup> If the Company subdivides (by any stock split, stock dividend, recapitalization or otherwise) its outstanding shares of its common stock into a smaller number of shares, the warrant exercise price is proportionately reduced and the number of shares under outstanding warrants is proportionately increased. Additionally, if the Company combines (by combination, reverse stock split or otherwise) its outstanding shares of common stock into a smaller number of shares, the warrant exercise price is proportionately increased and the number of shares under outstanding warrants is proportionately decreased.

**Liability Classified Warrants**

The Company applies a Monte Carlo simulation model to appropriately reflect the impact of the Down Round Feature to the Series E Warrants. The risk-free interest rate assumption is based upon observed interest rates on *zero* coupon US Treasury bonds linearly interpolated to obtain a maturity period commensurate with the term of the warrants. Estimated volatility is a measure of the amount by which the Company's stock price is expected to fluctuate each year during the expected life of the warrants.

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The assumptions used in determining the fair value of the Company's outstanding liability classified warrants as of *December 31, 2025* are as follows:

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| | |
|:---|:---|
|  | ***December 31, 2025*** |
| Risk-free interest rate | 3.63% |
| Volatility | 114.3% |
| Expected life (years) | 4.6 |
| Dividend yield | *—%* |

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During the year ended *December 31, 2025,* the exercise price and number of shares underlying certain warrants were adjusted pursuant to the anti-dilution provisions of the warrant agreements. These adjustments were triggered by the Company's reverse stock split and the issuance of common stock and common stock equivalents at prices below the then-current exercise prices of such warrants. In the aggregate, these adjustments increased the number of shares underlying the affected warrants by 1,528,326 shares. The resulting changes are reflected in the warrant activity rollforward below.

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| | | | |
|:---|:---|:---|:---|
|  | ***Number of Shares*** | ***Weighted Average*** | ***Weighted Average Remaining Contractual*** |
|  | ***Under Warrant*** | ***Exercise Price*** | ***Life (Years)*** |
| Balance at January 1, 2025 |  | $— | *-* |
| Granted | 4768525 | $3.76 | 4.70 |
| Adjustment from anti-dilution provisions | 1528326 | $3.90 | 4.60 |
| Exercised | (1376194) | $3.42 | 4.63 |
| Reclassification of warrant liabilities to equity pursuant to warrant amendments | (4906417) | $3.90 | 4.69 |
| Balance at December 31, 2025 | 14240 | $3.90 | 4.60 |
| Exercisable at December 31, 2025 | 14240 | $3.90 | 4.60 |

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For a summary of the changes in fair value associated with the Company's warrant liability for the years ended *December 31, 2025* and *2024*, see Note *2.* Basis of presentation, principles of consolidation and significant accounting policies – Fair Value of Financial Instruments.

**Equity Classified Warrants** 

A summary of the Company's equity classified warrant activity during the year ended *December 31, 2025* and related information follows:

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| | | | |
|:---|:---|:---|:---|
|  | ***Number of Shares*** | ***Weighted Average*** | ***Weighted Average Remaining Contractual*** |
|  | ***Under Warrant*** | ***Exercise Price*** | ***Life (Years)*** |
| Balance at January 1, 2025 | 312405 | $47.11 | 7.85 |
| Granted | 3485852 | $7.79 | 4.93 |
| Exercised | (1111909) | $19.40 | 5.66 |
| Expired warrants | (4739) | $1365.85 | 4.10 |
| Reclassification of warrant liabilities to equity pursuant to warrant amendments | 4906417 | $3.90 | 4.69 |
| Balance at December 31, 2025 | 7588026 | $4.34 | 4.79 |
| Exercisable at December 31, 2025 | 4943149 | $6.43 | 4.69 |

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The Company's equity awards granted during the year ended *December 31, 2025* primarily consisted of Series C and Series D warrants granted during the quarter ended *March 31, 2025,* Series G warrants issued in connection with the Company's warrant exercise inducement in *December 2025,* and Series E and Series F warrants that were reclassified to equity upon execution of the Warrant Amendment in *December 2025.* Equity awards exercised during the year ended *December 31, 2025* primarily consisted of the exercise of Series A, B, C, D, E and F warrants.

In *September 2025,* the Company granted equity classified warrants to purchase up to 14,000 shares of the Company's common stock with a ten year term and an exercise price of $10.75 per share. These warrants vest annually over four years, subject to continued service. In *July 2025,* the Company issued 8,000 equity-classified warrants to a consultant, of which 4,000 vested immediately and 4,000 vest upon the execution of a letter of intent or the closing of a licensing transaction with a value of *$10.0* million or more. In *January 2025,* the Company granted equity classified warrants to *two* consultants to purchase up to 2,000 shares of common stock each, with a ten-year term and an exercise price of $41.00 per share. Of these warrants, 2,000 vest upon the performance of specified services and the remaining 2,000 vest annually over four years.

In *October 2024,* the Company issued equity classified warrants to consultants to purchase up to 1,440 shares of common stock. Of these warrants, 1,200 vest annually over four years, 200 vest monthly over three years, and 40 vested immediately upon issuance. In *March 2024,* the Company granted equity classified warrants to purchase up to 133 shares of common stock with a ten year term and an exercise price of $228.75 per share. These warrants vest annually over four years, subject to continued service.

***6.* Stock Based Compensation** 

**Stock Plan, Stock-based Compensation and Outstanding Awards**

In *October 2024,* the Company's Board of Directors approved the Moleculin Biotech, Inc. *2024* Equity Incentive Plan (the *"2024* Stock Plan"), which replaced the Company's *2015* Stock Plan. The *2024* Stock Plan provides for the grant of stock options, stock awards, stock unit awards, and stock appreciation rights to employees, non-employee directors, and consultants of the Company.

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All share and per share amounts presented herein reflect the effect of the Company's *1*-for-25 reverse stock split completed on *December 1, 2025.* 

As initially approved, 40,000 shares of the Company's common stock were reserved for issuance under the *2024* Stock Plan. In *August 2025,* the Company's stockholders approved an amendment to the *2024* Stock Plan to increase the number of shares authorized for issuance from 40,000 shares to 280,000 shares of the Company's common stock. As of *December 31, 2025,* there were 22,105 shares available for future issuance under the *2024* Stock Plan.

Stock-based compensation expense for the years ended *December 31, 2025* and *2024* is as follows (in thousands):

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| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2024*** |
| General and administrative | $1181 | $1310 |
| Research and development | 483 | 416 |
| Total stock-based compensation | $1664 | $1726 |

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Each of the Company's stock-based compensation arrangements are discussed below.

**Stock Options**

Stock option awards are generally granted with an exercise price equal to the market price of the Company's stock at the date of grant. Stock option awards generally have a 10-year contractual term and vest over a 4-year period for employees and over a 1 to 3-year period for directors from the grant date on a straight-line basis over the requisite service period. The grant-date fair value of stock options is determined using the Black-Scholes option-pricing model (BSM). Additionally, the Company's stock options provide for full vesting of unvested outstanding options, in the event of a change of control of the Company.

The fair value of each stock option is estimated on the date of grant using the BSM model that uses the assumptions noted below. The expected term of the stock option awards was computed using the plain vanilla method as prescribed by the Securities and Exchange Commission Staff Accounting Bulletin *107* because the Company does *not* have sufficient data regarding employee exercise behavior to estimate the expected term. Beginning in *2020,* the Company used the volatility of its own stock in the BSM as it now has sufficient historic data in its stock price. The risk-free rate for periods within the contractual life of the option is based on the US Treasury yield curve in effect at the time of grant.

The fair value of the option grants has been estimated, with the following weighted-average assumptions:

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| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2024*** |
| Risk-free interest rate | 3.8% | 4.0% to 4.5% |
| Volatility | 111.8% to 116.8% | 89.1% to 98.9% |
| Expected life (years) | 6.25 | 5.1 to 6.3 |
| Expected dividend yield | *—*% | *—*% |

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Stock option activity for the year ended *December 31, 2025* is as follows:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | ***Number of Shares*** | ***Weighted Average Grant Date Fair Value*** | ***Weighted Average Exercise Price*** | ***Weighted Average Remaining Contractual Term (years)*** | ***Aggregate Intrinsic Value*** |
| Outstanding, December 31, 2024 | 31381 | $375.75 | $490.00 | 7.5 | $— |
| Granted | 161860 | $9.54 | $11.72 |  |  |
| Forfeited | (1204) | $59.13 | $73.19 |  |  |
| &nbsp;&nbsp;&nbsp; Expired | (183) | $1207.64 | $1541.48 |  |  |
| Outstanding, December 31, 2025 | 191854 | $68.57 | $88.89 | 9.5 | $— |
| Exercisable, December 31, 2025 | 14059 | $741.35 | $974.40 | 7.0 | $— |

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Options granted during *2025* and *2024* have an aggregated grant date fair value of $1.5 million and $1.1 million, respectively, that was calculated using the Black-Scholes option-pricing model. At *December 31, 2025*, total compensation cost *not* yet recognized was $2.5 million and the weighted average period over which this amount is expected to be recognized is 3.9 years. The aggregate fair value of options vested was $1.1 million and $1.2 million in the years ended *December 31, 2025* and *2024*, respectively.

The Company recorded stock compensation expense for the non-employee consulting agreements of $88,000 and $120,000 for the years ended *December 31, 2025* and *2024*, respectively. At *December 31, 2025*, there was $8,000 of unrecognized stock compensation expense related to the Company's equity-classified warrants.

**Restricted Stock Units**

Restricted stock units (RSU) are granted with a grant date fair value determined using the closing price of the Company's common stock on the grant date. Restricted stock units vest annually in four equal installments. Additionally, the Company's restricted stock unit agreements provide for full vesting of the restricted stock award in the event of a change of control of the Company.

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RSU activity for the year ended *December 31, 2025* is as follows:

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| | | | |
|:---|:---|:---|:---|
|  | ***Number of Shares*** | ***Weighted Average Grant Date Fair Value*** | ***Weighted Average Remaining Contractual Term (years)*** |
| Unvested Shares, December 31, 2024 | 13361 | $117.62 | 2.5 |
| Granted |  | $— | *-* |
| Vested | (3730) | $165.74 | 2.3 |
| Unvested Shares, December 31, 2025 | 9631 | $98.99 | 2.6 |

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As of *December 31, 2025*, total compensation cost for RSUs *not* yet recognized was $0.7 million and the weighted average period over which this amount is expected to be recognized is 2.6 years.

**Performance-Based Restricted Stock Units**

Performance-based restricted stock units (PSU) are granted primarily to our executive officers and only vest when specific conditions are met based on pre-established performance goals for the Company. PSUs are expensed only when meeting those conditions are deemed probable.

PSU activity for the year ended *December 31, 2025* is as follows:

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| | | | |
|:---|:---|:---|:---|
|  | **Number of Shares** | **Weighted Average Grant Date Fair Value** | **Weighted Average Remaining Contractual Term (years)** |
| Unvested Shares, December 31, 2024 | 2935 | $321.90 | 8.8 |
| Granted | 62000 | $12.25 | 9.9 |
| Unvested Shares, December 31, 2025 | 64935 | $26.25 | 9.9 |

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As of *December 31, 2025*, total compensation cost for PSUs *not* yet recognized was $1.7 million. The weighted average remaining contract term for these awards is 9.9 years.

In *November 2025,* the Company granted 62,000 PSUs to executive officers. Each PSU vests in equal tranches upon the achievement of specified clinical and operational milestones related to the Company's MIRACLE clinical trial, including patient enrollment thresholds, achievement of defined clinical data outcomes, and advancement to subsequent study phases. Vesting of each tranche is subject to certification by the Company's board of directors or its compensation committee. Stock-based compensation expense for these performance-based awards is recognized when achievement of the applicable performance conditions is considered probable, based on management's best estimates, which incorporate the inherent risks and uncertainties associated with achieving the underlying milestones. As of the issuance date and through *December 31, 2025, none* of the performance conditions were considered probable; accordingly, *no* compensation expense was recognized for these performance-based vesting awards.

In *December 2023,* the Company granted 2,935 PSUs to executive officers. Each PSU will vest upon the *first* of the following to occur: (a) a licensing transaction with a valuation, at the time, in excess of $150 million, which valuation shall be determined by the Board; (b) the filing of a new drug application; or (c) upon a Change in Control (as defined in the Plan), in each case subject to the respective executive officer's continued service with the Company as of each such vesting date. Recognition of stock-based compensation expense associated with these performance-based stock options commences when the performance condition is considered probable of achievement, using management's best estimates, which consider the inherent risk and uncertainty regarding the future outcomes of the milestones. As of the date of issuance and through *December 31, 2025*, *none* of the performance goals were deemed probable, and as a result, *no* expense was recognized for these performance-based vesting awards.

***7.* Income Taxes** 

The provision for income taxes consists of the following components (in thousands):

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| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2024*** |
| Current expense (benefit): |  |  |
| Federal | $*—* | $*—* |
| State | *—* | *—* |
| Foreign | *—* | *—* |
| Current income tax benefit | *—* | *—* |
| Deferred expense (benefit): |  |  |
| Federal | *—* | *—* |
| State | *—* | *—* |
| Foreign | *—* | *—* |
| Deferred income tax expense | *—* | *—* |
| Total | $*—* | $*—* |

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The following summarizes activity related to the Company's valuation allowance (in thousands):

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| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2024*** |
| Valuation allowance at beginning of period | $38637 | $32308 |
| Change charged to expense (income) | 5032 | 6329 |
| Release of valuation allowance |  |  |
| Valuation allowance at end of period | $43669 | $38637 |

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The domestic and foreign components of the Company's loss before tax provision for the years ended *December 31, 2025* and *2024,* were as follows (in thousands):

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| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2025** | **2024** |
| United States | $(33496) | $(25865) |
| Foreign | (64) | (183) |
| Loss before taxes | $(33560) | $(26048) |

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The following summarizes the Company's cash taxes paid by jurisdiction (in thousands):

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| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2025** | **2024** |
| Federal | $— | $— |
| State |  |  |
| Foreign |  |  |
| Total taxes paid | $— | $— |

---

A reconciliation of the income tax benefit computed using the federal statutory income tax rate to the Company's effective income tax rate is as follows (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2025*** | ***2024*** | ***2024*** |
|  | ***Amount*** | ***Percent*** | ***Amount*** | ***Percent*** |
| Federal tax (benefit) at statutory rate | $(7034) | 21.0% | $(5431) | 21.0% |
| State and local income Taxes |  |  | (34) |  |
| Foreign tax effects |  |  |  |  |
| Change in tax laws and rates |  |  |  |  |
| Effects of cross-border tax laws |  |  |  |  |
| Federal tax credits |  |  |  |  |
| Domestic change in valuation allowance | 5288 | (16.0) | 5672 | (21.8) |
| Nontaxable or nondeductible items |  |  |  |  |
| Stock warrant costs | 1498 | (4.0) | (387) | 1.5 |
| Other permanent differences | 74 |  | 60 | (0.2) |
| Other items | 174 | (1.0) | 120 | (0.5) |
| Total tax (expense) benefit | $— | -% | $— | (0.0)% |

---

The principal components of the Company's deferred tax assets and liabilities consist of the following (in thousands):

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2024*** |
| Deferred tax assets: |  |  |
| Start-up costs | $13851 | $11792 |
| Federal net operating loss carryforwards | 15972 | 12965 |
| &nbsp;&nbsp;&nbsp; 174 R&D Carryforward | 9130 | 8935 |
| State tax loss carryforwards | 270 | 560 |
| Foreign net operating loss carryforwards | 290 | 332 |
| Fixed Assets | 20 | 14 |
| Tax credit carryforward | 1919 | 1919 |
| ROU Liability | 78 | 104 |
| Deferred compensation | 2207 | 2108 |
| Total deferred tax assets | $43737 | $38729 |
| Less valuation allowance | (43669) | (38637) |
| Net deferred tax assets | $68 | $92 |
| Deferred tax liabilities: |  |  |
| ROU Asset | $(68) | $(92) |
| Total deferred tax liabilities | $(68) | $(92) |
| Net deferred taxes | $— | $— |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *84*

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The Company has incurred net operating losses since inception. As of *December 31, 2025*, the Company had total US federal operating loss carry forwards of approximately $76.1 million. Of this, $6.1 million will expire commencing in *2035,* with the rest having *no* set expiration date. The value of these carryforwards depends on the Company's ability to generate taxable income. Additionally, because federal tax laws limit the time during which the net operating loss carryforwards *may* be applied against future taxes, if the Company fails to generate taxable income prior to the expiration dates of the carry forwards the Company *may not* be able to fully utilize the net operating loss carryforwards to reduce future income taxes. Net operating loss carry forwards generated in *2018* and later years do *not* expire, but will only be able to offset *80%* of future taxable income. Finally, the Company has *not* undertaken a detailed analysis of the application of IRC Section *382* with respect to limitations on the utilization of net operating loss carryforwards and other deferred tax assets as management does *not* believe an ownership change has occurred within the meaning of IRC Section *382.* Management intends to undertake a Section *382* analysis prior to the utilization of any net operating loss carryforwards in the future. Based on current and ongoing losses, there is a full valuation allowance against the deferred tax asset for these carryforwards.

The Company conducts business in various locations and, as a result, files income tax returns in the United States federal jurisdiction, in multiple state jurisdictions, and internationally as required. As of *December 31, 2025*, the Company had state operating losses of approximately $6.2 million which expire commencing in *2036.* Since the Company is in a loss carryforward position, the Company is generally subject to examination by the US federal, state and local income tax authorities for all tax years in which a loss carryforward is available.

Management has evaluated the positive and negative evidence for the realizability of its deferred tax assets. The Company has cumulative losses and there is *no* assurance of future taxable income, therefore, valuation allowances have been recorded to fully offset the deferred tax asset at *December 31, 2025*. A valuation allowance of $43.7 million and $38.6 million has been established at *December 31, 2025* and *2024*, respectively. The change in the valuation allowance for the year ended *December 31, 2025* was primarily due to additional operating losses and capitalized research costs.

The Company conducts research and development ("R&D") activities that qualify for tax credits in both the United States and Australia. For U.S. federal income tax purposes, R&D tax credits are accounted for under ASC *740,* Income Taxes. The Company has recorded a full valuation allowance against its U.S. federal R&D tax credit carryforwards, as it has determined that it is more likely than *not* that these deferred tax assets will *not* be realized. These credits, if *not* utilized, will begin to expire in *2037.* For Australian purposes, the Company *may* be eligible to receive refundable tax incentives under the Australian Research and Development Tax Incentive program. As these incentives are refundable in cash and are *not* dependent on future taxable income, the Company recognizes the benefit of the Australian R&D incentive as a reduction to research and development expense in the consolidated statements of operations when it is probable that (i) the Company will comply with the relevant program requirements and (ii) the incentive will be received. During the year ended *December 31, 2025,* the Company received $0.1 million in cash refunds related to a $0.2 million refundable R&D tax credit associated with its *2023* R&D activities in Australia, which was recognized in *2024.*

The Company has a liability for unrecognized tax benefits of $0.3 million (excluding accrued interest and penalties) as of *December 31, 2025*. The Company's policy is to record interest and penalties related to income taxes as part of its income tax provision.

A reconciliation of the beginning and ending unrecognized tax benefits excluding interest and penalties is as follows (in thousands):

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2024*** |
| Balance, beginning of year | $339 | $339 |
| Additions for tax positions related to the current year |  |  |
| Additions for tax positions related to prior years |  |  |
| Reductions due to lapse of statutes of limitations |  |  |
| Decreases related to settlements with tax authorities |  |  |
| Balance, end of year | $339 | $339 |

---

The Company does *not* believe that its tax positions will significantly change due to any settlement and/or expiration of statutes of limitations prior to *December 31, 2025* within the next year.

On *July 4, 2025,* the One Big Beautiful Bill Act (OBBBA) (*H.R.1*) was signed into law by the President of the United States. The OBBBA contains significant provisions impacting corporate taxation in the U.S. with multiple effective dates. Among the changes effective in *2025* are modifications to capitalization of domestic research and development costs, accelerated depreciation of fixed assets and other qualifying property, as well as limitations on deductions for interest expense. Changes effective in *2026* include, among others, modifications to certain international tax provisions. The impacts of OBBBA are reflected in our results for the year ended *December 31, 2025.* There was *no* material effect on our income tax expense or effective tax rate.

***8.* Commitments and Contingencies**

In addition to the commitments and contingencies described elsewhere in these notes, see below for a discussion of the Company's commitments and contingencies for the years ended *December 31, 2025*, and *December 31, 2024*, respectively.

***Lease Obligations Payable***

In *September 2023,* the Company executed an amendment to extend the corporate office lease until *August 31, 2029,* with an option to renew. The Company is required to remit base monthly rent of approximately $4,700 which will increase at an average approximate rate of 2% each year. The Company is also required to pay additional rent in the form of its pro-rata share of certain specified operating expenses of the building. The leased space is located in Houston, Texas. The corporate office lease is classified as an operating lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *85*

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In *June 2022,* the Company entered into a Second Amendment to its Lease Agreement (Lab Lease) which it uses for lab space. The term of the Lease will continue through *September 30, 2027,* with *no* further right or option to renew. The Company is required to remit base monthly rent which will increase at an average approximate rate of 3% each year. The Lab Lease is classified as an operating lease. In *August 2019,* the Company entered into a sublease (which was extended in *2022* in connection with the lease extension) with a related party, Houston Pharmaceuticals, Inc. (HPI). The Company has granted HPI access to all of its Lab Lease space and HPI has agreed to pay the Company 50% of the Company's rent payable under the Lab Lease less 50% of any benefits from any sublease or other lab service agreement the Company *may* receive from its Lab Lease. Although HPI has access to the Company's Lab Lease space, it is the intent of the parties that they equally share the Lab Lease space for research purposes. The Company recorded approximately $49,000 in sublease income from the related party for the years ended *December 31, 2025* and *December 31, 2024*. Sublease income is recorded as other income on the Company's consolidated statement of operations and comprehensive loss.

The following summarizes quantitative information about the Company's operating leases for the years ended *December 31, 2025*, and *December 31, 2024*, respectively (in thousands):

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2024*** |
| **Lease cost:** |  |  |
| Operating lease cost | $150 | $150 |
| Variable lease cost | 29 | 24 |
| Total | $179 | $174 |

---

Other supplemental cash flow information for operating leases is as follows (in thousands):

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2025*** | ***2024*** |
| **Cash paid for amounts included in the measurement of lease liabilities:** |  |  |
| Operating cash flows from operating leases | $160 | $146 |

---

As of *December 31, 2025*, future minimum leases under ASC *842* under the Company's operating leases were as follows (in thousands):

---

| | |
|:---|:---|
| **Maturity of lease liabilities** | ***As of December 31, 2025*** |
| 2026 | $164 |
| 2027 | 141 |
| 2028 | 61 |
| 2029 | 41 |
| Total lease payments | 407 |
| Less: imputed interest | (48) |
| Present value of operating lease liabilities | $359 |

---

As of *December 31, 2025*, the weighted average remaining lease term for operating leases is 2.8 years, and the weighted average discount rate is 9.6%. The interest rate implicit in lease contracts is typically *not* readily determinable and as such, the Company uses an incremental borrowing rate based on a peer analysis using information available at the commencement date, which represents an internally developed rate that would be incurred to borrow, on a collateralized basis, over a similar term, an amount equal to the lease payments in a similar economic environment.

**Licenses**

***MD Anderson***

Under license and option agreements associated with Annamycin, the *WP1122* Portfolio and the *WP1066* Portfolio all described below, the Company is responsible for certain license, milestone and royalty payments over the course of the agreements. Annual license fees can cost as high as $0.1 million depending upon the anniversary, milestone payments for the commencement of phase II and phase III clinical trials, for the submission of an NDA to the FDA and for the receipt of marketing approval for sale of a license product can cost as high as $0.6 million, depending upon certain terms and conditions. *Not* all of these payments are applicable to every drug. Total expenses under these agreements were $147,000 and $229,000, respectively, for the years ended *December 31, 2025* and *2024.*

***Annamycin***

On *June 29, 2017,* the Company entered into a Patent and Technology License Agreement with MD Anderson licensing certain technology related to the method of preparing Liposomal Annamycin and on *December 17, 2021* the Company entered into an amendment to this agreement to include certain technology related to the method of reconstituting Liposomal Annamycin. On *December 2, 2021,* the Company entered into a Patent and Technology License Agreement with MD Anderson licensing certain technology related to lung targeted therapies with Annamycin. The terms and payments of these agreements are included in the summary above under Commitments and Contingencies – Licenses – MD Anderson. The terms of these agreements extend until the later of *20* years from the effective date of the agreements, or the expiration of the last-to-expire licensed patent. In addition, commencing on the *four*-year anniversary of each agreement, MD Anderson has the right to remove any jurisdiction from such agreement, upon *90* days' notice, if the Company has *not* commercialized or is *not* using commercially reasonable efforts actively and effectively to attempt to commercialize a licensed invention in such jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *86*

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****WP1066* Portfolio***

The rights and obligations to a *June 2010* Patent and Technology License Agreement entered into by and between Moleculin LLC and MD Anderson (*2010* Agreement) have been assigned MBI. Therefore, MBI has obtained a royalty-bearing, worldwide, exclusive license to intellectual property rights, including patent rights, related to its *WP1066* drug product candidate. On *February 3, 2022,* the Company entered into a new patent and technology license agreement (*2022* Agreement) with MD Anderson licensing certain technology related to *WP1066* checkpoint inhibitors. In *January 2024* the Company notified MD Anderson that it was terminating this license. In consideration for these agreements, the Company must make payments to MD Anderson including an up-front payment, milestone payments and minimum annual royalty payments for sales of products developed under the license agreement. Annual Maintenance fee payments will *no* longer be due upon marketing approval in any country of a licensed product under the *2010* Agreement. One-time milestone payments are due upon commencement of the *first* Phase III study for a licensed product within the United States, Europe, China or Japan; upon submission of the *first* NDA for a licensed product in the United States; and upon receipt of the *first* marketing approval for sale of a licensed product in the United States. The term of the *2010* Agreement extends until the later of *15* years from the effective date of the agreement, or the expiration of the last-to-expire licensed patent. The Company has rights as co-inventors to certain technology related to an intravenous formulation for *WP1066.* Additionally, the Company has exclusive, world-wide rights to MD Anderson's co-inventor rights to the same technology via an option. Such option is related to the Company maintaining its Sponsored Research Agreement, discussed below, with MD Anderson into *2027.*

****WP1122* Portfolio***

The rights and obligations to an *April 2012* Patent and Technology License Agreement entered into by and between IntertechBio and MD Anderson (*2012* Agreement) have been assigned to MBI. Therefore, MBI has obtained a royalty-bearing, worldwide, exclusive license to intellectual property, including patent rights, related to its *WP1122* Portfolio and to its drug product candidate, *WP1122.* On *October 21, 2022,* the Company entered into a new patent and technology license agreement (*2022* Agreement) with MD Anderson for an additional molecule under the *WP1122* Portfolio. On *December 3, 2021,* the Company entered into a new patent and technology license agreement (*2021* Agreement) with MD Anderson licensing certain technology related to *WP1122* anti-viral treatments. The *2012* Agreement was amended in *May 2020* to allow for the extension of certain milestones. The initial milestone required the Company to file an IND with the FDA for a Phase I study by *February 20, 2021.* The Company extended the deadline for this milestone by *six* months by making the required extension payment, and the Company has the right to receive *two* additional *six*-month extensions in the future by making additional extension payments. On *August 3, 2021,* the Company filed a CTA for the application of *WP1122* in the United Kingdom to commence a Phase *1a* clinical trial of *WP1122.* MD Anderson agreed that this CTA filing would further extend the deadline to file an IND with the FDA for a Phase I study until *February 2022.* In *December 2021,* the Company submitted an IND for the treatment of GBM with *WP1122* to the FDA, thus meeting the IND filing milestone. The term of the *2012* agreement extends until the later of *15* years from the effective date of the agreement, or the expiration of the last-to-expire licensed patent. In addition, MD Anderson *may* terminate the *2012* agreement if the Company fails to commence a Phase *2* study for licensed product prior to *November 20, 2024,* which has *not* occurred. The term of the *2021* agreement extends until the later of *20* years from the effective date of the agreement, or the expiration of the last-to-expire licensed patent. In an effort to reduce costs, the Company is in the process of replacing its licenses on *WP1122* with an option on *WP1122* with MD Anderson. Such discussions are being held in conjunction with extending our sponsored research with MD Anderson. There can be *no* assurance that this process will result to the Company's satisfaction.

***Sponsored Research Agreements with MD Anderson***

The Company has a Sponsored Laboratory Study Agreement (Sponsored Research Agreement) with MD Anderson through *March 31, 2027,* and is expected to be extended; however, there can be *no* assurance that such extension will occur. During the *first* quarter *2025,* the Company entered into various amendments to the Sponsored Research Agreement with MD Anderson for total additional payments to MD Anderson of $0.3 million to support the project. In *August 2025,* the Company executed another amendment to the Sponsored Research Agreement with MD Anderson, extending the ongoing research collaboration. The amendment provides for continued research through *March 31, 2027,* focused on the development and preclinical evaluation of the Company's drug candidates. Total funding under the Sponsored Research Agreement, as amended, is approximately $1.6 million, payable in scheduled installments. Expenses recognized under these agreements totaled $0.9 million and $2.1 million for the years ended *December 31, 2025* and *2024*.

**Other Guarantees**

***Bank Guarantee and Letter of Credit***

In *December 2023,* the Company entered into a letter of credit with its primary banking relationship in the US, or bank guarantee, in the amount of $0.2 million, in connection to a value-added tax (VAT) registration in Poland. In *December 2025,* the letter of credit was terminated. To date, there have been no draws or claims against this bank guarantee.

***Employment Agreements***

The Company has agreements with certain executive and other employees to provide benefits in the event of termination. The base salary and certain other benefits would aggregate approximately $5.6 million using the rate of compensation in effect at *December 31, 2025*.

***9.* Subsequent Events** 

On *February 19, 2026,* the Company entered into warrant inducement agreements with certain holders of its existing equity-classified Series E and Series F warrants. Pursuant to these agreements, the holders exercised warrants to purchase an aggregate of 2,122,652 shares of the Company's common stock at an exercise price of $3.90 per share, resulting in gross proceeds of approximately $8.3 million. In connection with these transactions, the number of shares underlying the remaining outstanding Series E warrants increased by 597,359 shares pursuant to the anti-dilution provisions contained in those warrants. In consideration for the exercises, the Company agreed to issue new Series H warrants to purchase up to 6,367,956 shares of common stock. The Series H warrants have a five-year term and an exercise price of $2.3976 per share. The warrants contain customary anti-dilution adjustments and beneficial ownership limitations and will become exercisable upon stockholder approval in *April 2026.* The Company has agreed to file a resale registration statement covering the shares of common stock issuable upon exercise of the Series H warrants on or before *March 31, 2026,* and to use commercially reasonable efforts to cause such registration statement to be declared effective by *April 30, 2026.* Due to the completion of this transaction, the exercise price of our outstanding Series E warrants was adjusted to $3.00 per share, the exercise price of our outstanding Series F warrants was adjusted to $2.75 per share, and the exercise price of our outstanding Series G warrants was adjusted to $2.3976 per share.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 87

## Exhibit 23.1

**Exhibit 23.1**

**CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

We have issued our report dated March 18, 2026, with respect to the consolidated financial statements included in the Annual Report of Moleculin Biotech, Inc. on Form 10-K for the year ended December 31, 2025. We consent to the incorporation by reference of said report in the Registration Statements of Moleculin Biotech, Inc. on Forms S-1 (File No. 333-276851, File No. 333-280951, File No. 333-283820, File No. 333-286276 and File No. 333-287727), on Forms S-3 (File No. 333-256627, File No. 333-280064, File No. 333-290418 and File No. 333-292420) and on Forms S-8 (File No. 333-212619, File No. 333-225867, File No. 333-248240, File No. 333-266225, File No. 333-272814, File No. 333-282838 and File No. 333-290159).

/s/ GRANT THORNTON LLP

Fort Lauderdale, Florida

March 18, 2026

## Exhibit 31.1

**Exhibit 31.1**

<u>**OFFICER'S CERTIFICATION PURSUANT TO**</u>

<u>**SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**</u>

I, Walter V. Klemp, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;1. I have reviewed this Annual Report on Form 10-K of Moleculin Biotech, Inc.;

&nbsp;&nbsp;&nbsp;&nbsp;2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made not misleading with respect to the period covered by this report;

&nbsp;&nbsp;&nbsp;&nbsp;3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

&nbsp;&nbsp;&nbsp;&nbsp;4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

March 18, 2026

<u>By: /s/ Walter V. Klemp</u> 

Walter V. Klemp

Chief Executive Officer

(Principal Executive Officer)

## Exhibit 31.2

**Exhibit 31.2**

<u>**OFFICER'S CERTIFICATION PURSUANT TO**</u>

<u>**SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**</u>

I, Jonathan P. Foster, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;1. I have reviewed this Annual Report on Form 10-K of Moleculin Biotech, Inc.;

&nbsp;&nbsp;&nbsp;&nbsp;2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made not misleading with respect to the period covered by this report;

&nbsp;&nbsp;&nbsp;&nbsp;3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

&nbsp;&nbsp;&nbsp;&nbsp;4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

March 18, 2026

<u>By: /s/ Jonathan P. Foster</u> 

Jonathan P. Foster

Chief Financial Officer

(Principal Financial Officer and Principal Accounting Officer)

## Exhibit 32.1

**Exhibit 32.1**

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report on Form 10-K for the fiscal year ended December 31, 2025 of Moleculin Biotech, Inc. (the "Company") as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Walter V. Klemp, Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C 78m or 78o(d)); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: March 18, 2026

<u>By: /s/ Walter V. Klemp</u> 

Walter V. Klemp

Chief Executive Officer

(Principal Executive Officer)

*A signed original of this written statement required by Section 906 has been provided to Moleculin Biotech, Inc. and will be retained by Moleculin Biotech, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.*

## Exhibit 32.2

**Exhibit 32.2**

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report on Form 10-K for the fiscal year ended December 31, 2025 of Moleculin Biotech, Inc. (the "Company") as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Jonathan P. Foster, Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C 78m or 78o(d)); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: March 18, 2026

<u>By: /s/ Jonathan P. Foster</u> 

Jonathan P. Foster

Chief Financial Officer

(Principal Financial Officer and Principal Accounting Officer)

*A signed original of this written statement required by Section 906 has been provided to Moleculin Biotech, Inc. and will be retained by Moleculin Biotech, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.*