Onconetix, Inc.

Note 1 — Organization and Basis of Presentation

Organization and Nature of Operations

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

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

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

Historically, the Company’s focus was on the research and development of transformational vaccines to prevent infectious diseases worldwide, until the third quarter of 2023, at which time the Company halted its efforts on vaccine development activities to focus on commercialization activities for ENTADFI and pursue other potential acquisitions. However, in light of (i) the time and resources needed to continue pursuing commercialization of ENTADFI, and (ii) the Company’s cash runway and indebtedness, the Company has abandoned commercialization of ENTADFI and is in the process of destroying its inventory of the product. Based on the circumstances surrounding ENTADFI, the ENTADFI assets were fully impaired at June 30, 2024 (see Note 4).

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

Reverse Stock Split

On September 24, 2024, the Company effected a reverse stock split of all shares of its issued and outstanding Common Stock at a ratio of one-for-forty (1:40). The Company accounted for the reverse stock split on a retrospective basis pursuant to Accounting Standards Codification (“ASC”) 260,Earnings Per Share. All issued and outstanding common stock, common stock warrants, and share-based awards’ exercise prices and per share data have been adjusted in these condensed consolidated financial statements, on a retrospective basis, to reflect the reverse stock split for all periods presented. The number of authorized shares and par value of the preferred stock and common stock were not adjusted because of the reverse stock split.

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

Basis of Presentation and Principles of Consolidation

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

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

Unaudited Interim Consolidated Financial Statements

The accompanying condensed consolidated balance sheet as of June 30, 2025, and the condensed consolidated statements of operations and comprehensive loss and the condensed consolidated statements of convertible preferred stock and stockholders’ equity (deficit) for the three and six months ended June 30, 2025 and 2024, and the condensed consolidated statements of cash flows for the six months ended June 30, 2025 and 2024 are unaudited. These unaudited interim consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, and in management’s opinion, include all adjustments, consisting of only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of June 30, 2025 and its results of operations and comprehensive loss for the three and six months ended June 30, 2025 and 2024, and its cash flows for the six months ended June 30, 2025 and 2024. The financial data and the other financial information disclosed in the notes to these condensed consolidated financial statements related to the three-month periods are also unaudited. Operating results for the three and six months ended June 30, 2025, are not necessarily indicative of the results that may be expected for the year ended December 31, 2025, any other interim periods, or any future year or period. The unaudited condensed consolidated financial statements included in this Report should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, which includes a broader discussion of the Company’s business and the risks inherent therein.

Note 2 — Going Concern and Management’s Plans

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

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

As of June 30, 2025, the Company had cash of approximately $0.3 million, a working capital deficit of approximately $11.8 million and an accumulated deficit of approximately $128.1 million. During the six months ended June 30, 2025, the Company used approximately $3.4 million in cash for operating activities. In addition, as of August 13, 2025, the Company’s cash balance was approximately $0.2 million. The Company’s current cash balance is not sufficient to fund its operations through twelve months after the date these financials are issued, unless it can obtain other financing or utilize the Equity Financing Line of Credit (“ELOC”), which it entered into on October 2, 2024, referred herein as the ELOC Purchase Agreement; however, projections are indicative that it will be unable to meet its contractual commitments and obligations as they come due in the ordinary course of business. As of August 13, 2025, the amount available under the ELOC is approximately $17.0 million. Effective in 2025, the Company has redeemed Series C preferred stock of approximately $1.71 million with approximately $0.4 million in redemptions owed as of June 30, 2025. The Company will require significant additional capital in the short-term to fund its continuing operations, satisfy existing and future obligations and liabilities, including the funds needed to support the Company’s working capital needs and business activities. These business activities include the commercialization of Proclarix, and the development and commercialization of the Company’s future product candidates. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date of the issuance of these condensed consolidated financial statements.

Management’s plans for funding the Company’s operations include generating product revenue from sales of Proclarix, which is still subject to further successful development and commercialization activities within certain jurisdictions. Management also intends to secure additional required funding through equity or debt financings if available, and to utilize the ELOC entered into in October 2024 (see Note 8) on an as-needed basis to assist with the paydown of notes issued to Veru and to fund current operating needs, subject to certain restrictions and beneficial ownership constraints. However, based on the terms of the ELOC and the current maximum availability, management determined that the funds readily available under the ELOC will not be sufficient to sustain operations. In addition, there are currently no other commitments in place for further financing nor is there any assurance that such financing will be available to the Company on favorable terms, if at all. This creates significant uncertainty whether the Company will have the funds available to be able to sustain its operations and expand commercialization of Proclarix. If the Company is unable to secure additional capital, it may be required to curtail any future clinical trials, development and/or commercialization of future product candidates, and it may take additional measures to reduce expenses in order to conserve its cash in amounts sufficient to sustain operations and meet its obligations.

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

Note 3 — Summary of Significant Accounting Policies

During the six months ended June 30, 2025, there were no changes to the Company’s significant accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. Selected significant accounting policies are discussed in further detail below:

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting periods. The most significant estimates in the Company’s condensed consolidated financial statements relate to accounting for acquisitions, valuation of inventory, the useful life of the amortizable intangible assets, estimates of future cash flows used to evaluate impairment of intangible assets, assumptions related to the pension benefit obligation, assumptions related to the related party subscription agreement liability, assumption related to note payables, and accounting for income taxes. These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources. Actual results may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and actual results, the Company’s future results of operations will be affected.

Segment Information

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. As of June 30, 2025 and December 31, 2024, the Company was operating inone segment: commercial. Management’s determination of its operating segments is consistent with the financial information regularly reviewed by the CODM for purposes of evaluating performance, allocating resources, setting incentive compensation targets, and planning and forecasting for future periods.

Fair Value Measurements

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

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

The fair value of the contingent warrant liability and the related party subscription agreement liability are valued using significant unobservable measures and other fair value inputs and are therefore classified as Level 3 financial instruments.

The fair value of financial instruments measured on a recurring basis is as follows as of June 30, 2025 and December 31, 2024:

During the three months ended June 30, 2025, the subscription agreement liability - related party expired and was settled resulting in the recognition of $2 in common stock and $995,036 in additional paid in capital as of June 30, 2025.

During the year ended December 31, 2024, the Company recorded full impairments of the intangible assets acquired from the acquisitions of Proteomedix and ENTADFI. These non-financial assets had been valued using significant unobservable measures and other fair value inputs and were classified as Level 3 measurements.

None of the Company’s other non-financial assets or liabilities are recorded at fair value on a non-recurring basis as of June 30, 2025 and December 31, 2024. There were no transfers between levels during the periods presented.

The following table summarizes the activity for the related party subscription agreement liability, using unobservable Level 3 inputs, for the three and six months ended June 30, 2025:

The following table summarizes the activity for the contingent warrant liability, using unobservable Level 3 inputs, for the three and six months ended June 30, 2025:

Revenue Recognition

The following is a description of principal activities from which the Company generates its revenue:

Development Services

Proteomedix provides a range of services to life sciences customers referred to as “Development Services” including testing for biomarker discovery, assay design and development. These Development Services are performed under individual statement of work (“SOW”) arrangements with specific deliverables defined by the customer. Development Services are generally performed on a time and materials basis. During the performance and through completion of the service to the customer in accordance with the SOW, the Company has the right to bill the customer for the agreed upon price and recognizes the Development Services revenue over the period estimated to complete the SOW. The Company generally identifies each SOW as a single performance obligation.

Completion of the service and satisfaction of the performance obligation under a SOW is typically evidenced by access to the data or test made available to the customer or any other form or applicable manner of delivery defined in the SOW. However, for certain SOWs under which work is performed pursuant to the customer’s highly customized specifications, the Company has the enforceable right to bill the customer for work completed, rather than upon completion of the SOW. For those SOWs, the Company recognizes revenue over a period of time during which the work is performed based on the expended efforts (inputs). As the performance obligation under the SOW is satisfied, any amounts earned as revenue and billed to the customer are included in accounts receivable.

Product Sales

The Company derives revenue through sales of its products, which includes Proclarix, its diagnostic product, directly to end users, including laboratories, hospitals, and medical centers, and to distributors. The Company considers customer purchase orders, which in some cases are governed by master sales agreements or standard terms and conditions, to be the contracts with a customer. For each contract, the Company considers the promise to transfer products, each of which is distinct, to be the identified performance obligations. In determining the transaction price, the Company evaluates whether the price is subject to refund or adjustment to determine the net consideration to which it expects to be entitled. The Company fulfills its performance obligation applicable to product sales once the product is transferred to the customer.

During the three months ended June 30, 2025 and 2024, the Company recognized revenue of approximately $0.1 million and $0.7 million, respectively.

During the six months ended June 30, 2025 and 2024, the Company recognized revenue of approximately $0.2 million and $1.4 million, respectively.

The Company’s revenue was generated from the following geographic regions during the three months ended June 30, 2025:

The Company’s revenue was generated from the following geographic regions during the six months ended June 30, 2025:

The Company’s revenue was generated from the following geographic regions during the three months ended June 30, 2024:

The Company’s revenue was generated from the following geographic regions during the six months ended June 30, 2024:

The Company had the following customer concentrations for its revenue during the three and six months ended June 30, 2025 and 2024:

Any revenues earned but not yet billed to the customer as of the date of the condensed consolidated financial statements are recorded as contract assets and are included in prepaid expenses and other current assets in the accompanying condensed consolidated financial statements. The Company hadno unbilled accounts receivable as of June 30, 2025 and December 31, 2024. Amounts recorded in contract assets are reclassified to accounts receivable in our condensed consolidated financial statements when the customer is invoiced according to the billing schedule in the contract. Accounts receivable was approximately $12,000 and $26,000 as of June 30, 2025 and December 31, 2024, respectively.

In relation to customer contracts, the Company incurs costs to fulfill a contract but does not incur costs to obtain a contract. These costs to fulfill a contract do not meet the criteria for capitalization and are expensed as incurred.

New Accounting Pronouncements

There were no new accounting pronouncements issued since the Company’s filing of the Annual Report on Form 10-K for the year ended December 31, 2024, which could have a significant effect on the accompanying condensed consolidated financial statements.

Note 4 — Balance Sheet Details

Inventories

Inventories, which primarily relate to Proclarix products as of June 30, 2025 and December 31, 2024, consisted of the following:

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following as of June 30, 2025, and December 31, 2024:

Note 4 — Balance Sheet Details(cont.)

Intangible Assets

Intangible assets acquired in connection with the ENTADFI and Proteomedix acquisitions were comprised of customer relationships, product rights for developed technology, and a trade name. These intangibles were fully impaired during the year ended December 31, 2024 resulting in a zero balance as of June 30, 2025 and December 31, 2024.

Amortization for three and six months ended June 30, 2024

The finite lived intangible assets held by the Company, which included customer relationships and product rights for developed technology, were amortized over their estimated useful lives of 15 years. For the three and six months ended June 30, 2024, amortization expense related to the Company’s finite-lived intangible assets was approximately $196,000 and $398,000, of which approximately $30,000 and $61,000 was recorded as selling, general, and administrative expenses and approximately $166,000 and $337,000 was recorded as cost of revenue in the accompanying condensed consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2024.

Impairment for three and six months ended June 30, 2024

During the six months ended June 30, 2024, the Company became aware of a new competitor that received approval by the FDA for a combined finasteride-tadalafil capsule, which is a direct competitor product to ENTADFI. This was determined to be a triggering event that could result in a decrease in future expected cash flows, and thus indicated the carrying amount of the ENTADFI asset group may not be fully recoverable. The Company performed an undiscounted cash flow analysis over the ENTADFI asset group and determined that the carrying value of the asset group is not recoverable. The Company then estimated the fair value of the asset group to measure the impairment loss for the period. Significant assumptions used to determine this non-recurring fair value measurement included projected sales driven by market share and product sales price estimates, associated expenses, growth rates, the discount rate used to measure the fair value of the net cash flows associated with this asset group, as well as Management’s estimates of an expected sales price for the asset group, and the probability of each potential strategic alternative taking place. The Company recorded an intangible asset impairment charge of approximately $1.2 million and $3.5 million during the three and six months ended June 30, 2024, respectively.

Goodwill

Goodwill consisted of the following as of June 30, 2025 and December 31, 2024:

Impairments for three and six months ended June 30, 2025 and 2024

During the three and six months ended June 30, 2025 and 2024, the Company’s stock price and market capitalization declined, and the Company determined that this was an indicator of a potential impairment of its goodwill. Accordingly, as of June 30, 2025 and 2024, the Company performed quantitative analysis to identify and measure the amount of impairment losses to be recognized. The Company recognized goodwill impairment losses of approximately $0.6 million and $10.3 million for the three months ended June 30, 2025 and 2024, respectively. The Company recognized goodwill impairment losses of approximately $11.5 million and $15.5 million for the six months ended June 30, 2025 and 2024, respectively.

The fair value estimate of the reporting units for the quarter ended June 30, 2025 was derived from the Company’s fully-diluted market capitalization using an indicative share price based on the 5- and 10-day trailing volume-weighted average price.

Note 4 — Balance Sheet Details(cont.)

Accrued Expenses

Accrued expenses consisted of the following as of June 30, 2025 and December 31, 2024:

Note 5 — Significant Agreements

Services Agreement

On July 21, 2023, the Company, entered into a Licensing and Services Master Agreement (“Master Services Agreement”) and a related statement of work with a vendor, pursuant to which the vendor was to provide to the Company commercialization services for the Company’s products, including recruiting, managing, supervising and evaluating sales personnel and providing sales-related services for such products, for fees totaling up to $29.1 million over the term of the statement of work. The statement of work had a term through September 6, 2026, unless earlier terminated in accordance with the Master Services Agreement and the statement of work. On July 29, 2023, a second statement of work was entered into with the same vendor for certain subscription services providing prescription market data access to the Company. The fees under the second statement of work totaled approximately $800,000, and the term was through July 14, 2025. On October 12, 2023, the Company terminated the Master Services Agreement and the statements of work. During 2023, the Company recognized a termination fee of approximately $1.4 million included in selling, general and administrative expense. Subsequently during 2024, the Company agreed with the vendor to pay a reduced termination fee of approximately $0.9 million and recorded net credits of $0.5 million for the difference in the termination fee related to this contract during the year ended December 31, 2024, which was included in selling, general and administrative expense for the year then ended. During the six months ended June 30, 2025, the Company settled the remaining balance of the termination fee and recognized a $0.9 million gain on forgiveness of accounts payable in the accompanying condensed consolidated statement of operations and comprehensive loss.

Laboratory Corporation of America

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

Note 5 — Significant Agreements(cont.)

The total available milestone payments available under the terms of this contract is $2.5 million. An additional $0.5 million was paid to Proteomedix as an initial license fee in 2023.

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

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

As of June 30, 2025, the sale of Licensed Products by LabCorp under the license agreement has not commenced. The Company has sold product to LabCorp for their use in internal trials of the test.

Note 6 — Notes Payable

Veru Notes Payable

As of June 30, 2025 and December 31, 2024, the Company has two non-interest-bearing notes payable (the “Notes”) outstanding with principal amounts of $5.0 million and $5.0 million and initial maturity dates of April 19, 2024 (“April Veru Note”), and September 30, 2024 (“September Veru Note”), respectively. In accordance with the Notes, no principal payments are due until maturity; however, the Company may voluntarily prepay the Notes with no penalty. Additionally, in an Event of Default, as defined in the Notes, the unpaid principal amount of the Notes will accrue interest at a rate of 10.0% per annum.

The Company imputed interest on the Notes using an average discount rate of 8.2% and recorded a debt discount of approximately $1.1 million at the issuance date. The debt discount is reflected as a reduction in the carrying amount of the Notes and amortized to interest expense through the respective maturity dates, using the effective interest method.

On April 24, 2024, the Company entered into a forbearance agreement with Veru (the “Original Forbearance Agreement”) due to the Company’s failure to repay the principal balance on the $5.0 million note payable that had a maturity date of April 19, 2024 (the “April Veru Note”). Pursuant to the Original Forbearance Agreement, Veru will forbear from exercising its rights and remedies under the April Veru Note as a result of this default, until March 31, 2025 (the “April 2024 Forbearance Period”).

Interest will accrue on any unpaid principal balance of the April Veru Note at a rate of 10% per annum, commencing on April 20, 2024 through the date that the outstanding principal balance under the April Veru Note is paid in full. Any such accrued interest will become immediately due and payable upon the earlier of (i) certain events of default under the April Veru Note or the $5.0 million note payable that matures on September 30, 2024 (the “September Veru Note”), (ii) a payment default under the September Veru Note and (iii) the final payment of any principal amount payable under the September Veru Note. No interest was to accrue under the September Veru Note during the April 2024 Forbearance Period unless an Event of Default (as defined in the Original Forbearance Agreement) occurs, in which case interest will accrue from and after the date on which such default occurs.

In consideration for Veru’s entrance into the Original Forbearance Agreement, the Company agreed to pay Veru:

The Company also agreed to a general release of claims against Veru and its representatives arising out of or relating to any act or omission thereof prior to April 24, 2024.

The Company determined that the Original Forbearance Agreement should be accounted for as a modification of the April Veru Note and the September Veru Note in accordance with ASC 470-50,Debt - Modifications and Extinguishments (“ASC 470”), as the change in cash flows expected under the April Veru Note and the September Veru Note was not substantial. A new effective interest rate was established based on the carrying value of the original Notes and the revised cash flows and no gain or loss was recorded.

On September 19, 2024, the Company entered into an Amended and Restated Forbearance Agreement with Veru (the “Amended and Restated Forbearance Agreement” or “A&R Forbearance Agreement”), which amends and restates the Original Forbearance Agreement in its entirety. Pursuant to the A&R Forbearance Agreement, Veru will forbear from exercising its rights under both the April Veru Note and the September Veru Note, subject to the terms and conditions set forth below.

The A&R Forbearance Agreement extends the due date for the April 2024 and September 2024 Veru Notes until the earlier to occur of (i) June 30, 2025 or (ii) the occurrence of any Event of Default. The Amended and Restated Forbearance Agreement also effected certain modifications to the payment terms in the Original Forbearance Agreement and amended certain terms of the September Veru Note as summarized below.

Pursuant to the A&R Forbearance Agreement, the Company agreed to make the following required payments (the “Required Payments”) during the April 2024 Forbearance Period, first to accrued and unpaid interest under the April Veru Note and then any remainder to the outstanding principal amount of the April Veru Note:

The Company and Veru also agreed to the following amendments to the September Veru Note in the A&R Forbearance Agreement:

The Company determined the A&R Forbearance Agreement should be accounted for as a modification of both the April and September Veru Notes in accordance with ASC 470-50,Debt - Modifications and Extinguishments (“ASC 470”), as the change in cash flows expected under the April Veru Note and the September Veru Note was not substantial. A new effective interest rate was established based on the carrying value of the original Notes and the revised cash flows and no gain or loss was recorded.

On November 26, 2024, the Company entered into another Amended and Restated Forbearance Agreement with Veru (the “November Amended and Restated Forbearance Agreement” or “November A&R Forbearance Agreement”), which amends and restates certain terms of the Amended and Restated Forbearance Agreement. Pursuant to the November A&R Forbearance Agreement, Veru agreed to waive the due date for payment of applicable Cash Receipt Payments (as such term is defined in the A&R Forbearance Agreement) generated in October 2024 until the Company receives funds of at least $97,000 pursuant to its equity line of credit facility with Keystone Capital Partners LLC. In exchange, the Company agreed to increase its payments to be made to Veru out of future financing and strategic transactions through June 30, 2025, from 20% to 25% of net proceeds generated from such transactions. All other terms of the A&R Forbearance Agreement with Veru remain the same. Management has evaluated and concluded that there is no accounting impact from the A&R Forbearance Agreement with Veru.

On March 31, 2025, Veru and the Company entered into a waiver agreement, pursuant to which Veru agreed to waive and extend the date for payment of the April 2024 Promissory Note to April 14, 2025.

On April 23, 2025, Veru and the Company entered into a limited waiver agreement, pursuant to which Veru agreed to waive and extend the date for payment of the April 2024 Promissory Note to June 30, 2025.

On June 30, 2025, Veru and the Company entered into a limited waiver agreement, pursuant to which Veru agreed to waive and extend the date for payment of the April 2024 and September 2024 Promissory Notes to July 31, 2025.

On July 31, 2025, Veru and the Company entered into a waiver agreement, pursuant to which Veru agreed to waive and extend the date for payment of the April 2024 and September 2024 Promissory Notes to August 14, 2025.

During the three and six months ended June 30, 2025 and 2024, the Company recorded approximately $0.2 million and $0.4 million of interest expense, respectively, which includes accrued interest and amortization of the debt discount. The unamortized debt discount as of June 30, 2025 and December 31, 2024 was $0 and $5,000, respectively. As of June 30, 2025 and December 31, 2024, the Company has recorded accrued interest of approximately $0.4 million and $0.1 million, respectively, which is included in accrued expenses in the accompanying condensed consolidated balance sheets.

Future minimum principal payments on the Notes as of June 30, 2025 include $3.1 million in principal payments for the April Veru Note and $5.0 million principal payments for the September Veru Note that are due in August 14, 2025.

Related Party Debenture

On January 23, 2024, the Company issued a non-convertible debenture (the “Debenture”) to the PMX Investor, a related party, in the principal sum of $5.0 million, in connection with the Subscription Agreement discussed in Note 7. The Debenture has an interest rate of 4.0% per annum, and the principal and accrued interest was originally payable in full upon the earlier of (i) the closing under the Subscription Agreement and (ii) June 30, 2024. Additionally, the $5.0 million subscription amount under the Subscription Agreement shall be increased by the amount of interest payable under the Debenture.

On April 24, 2024, the maturity date of the related party debenture was extended to October 31, 2024, through the execution of an extension agreement (the “Extension Agreement”) between the Company and the PMX investor. No other terms of the Debenture were modified in connection with the Extension Agreement.

The Company considered the guidance of ASC 470-60,Troubled Debt Restructuring by Debtors, and concluded that the Extension Agreement should be accounted for as a troubled debt restructuring as the Company is experiencing financial difficulty and since the effective borrowing rate under the Extension Agreement is less than the effective borrowing rate under the original agreement, which indicates that a concession is deemed to have been granted. This did not result in a gain on restructuring as the future undiscounted cash outflows required under the Extension Agreement exceed the carrying value of the Debenture immediately prior to the extension. A new effective rate was established based on the carrying value of the original Debenture and the revised cash flows.

In connection with the issuance of the Debenture, the Company incurred approximately $0.4 million in financing fees, which was recorded as a debt discount, and reflected as a reduction in the carrying amount of the Debenture. The debt discount is being amortized to interest expense through the maturity date. The Company did not incur any financing fees in connection with the Extension Agreement.

On September 24, 2024, the Company converted all unpaid principal and accrued interest due under the Debenture into 500,000 units, attributable to principal, and 13,424 units, attributable to accrued interest, upon the closing of the Subscription Agreement. Each unit consisted of 1 share of common stock and 0.30 pre-funded warrants at an exercise price of $0.04 per share. As a result of the transaction,513,424 shares of common stock were issued, and 154,027 pre-funded warrants were issued. As of December 31, 2024, there is no outstanding balance or accrued interest remaining on the Debenture. The remaining unamortized debt discount was immediately expensed upon settlement.

The Company recorded approximately $0.2 million and $0.4 million of interest expense on the Debenture during the three and six months ended June 30, 2024, respectively, which includes accrued interest and amortization of the debt discount. There was no such interest expense during the three and six months ended June 30, 2025.

Insurance Financing

During the six months ended June 30, 2025, the Company obtained financing for certain Director & Officer liability insurance policy premiums. The agreement assigns the lender a first priority lien on and security interest in the financed policies and any additional premium required in the financed policies.

The total premiums, taxes and fees financed are approximately $0.5 million, with an annual interest rate of 7.25%. In consideration of the premium payment by the lender to the insurance companies or the agent or broker, the Company unconditionally promised to pay the lender the amount financed plus interest and other charges permitted under the agreement. On June 30, 2025, the Company recognized approximately $0.2 million as an insurance financing note payable, which is included in the current portion of notes payable in the accompanying condensed consolidated balance sheets. The Company will pay the insurance financing through monthly installment payments of approximately $52,768, with the last payment for the note due on November 17, 2025.

Keystone Notes Payable

During the six months ended June 30, 2025, the Company issued three subordinated promissory notes to Keystone Capital Partners, LLC, each with an original issue discount and payable upon the earlier of (i) receipt of sufficient proceeds from the Company’s Equity Line of Credit (“ELOC”) with the Investor or (ii) a specified maturity date. All notes are subordinated to the Company’s existing debt obligations to Veru Inc., do not initially bear interest, and are subject to a late charge of 15% per annum on any unpaid amounts past due.

Note 7 — Subscription Agreement

On December 18, 2023, the Company entered into a subscription agreement (the “Subscription Agreement”) with the PMX Investor, who became a stockholder of Onconetix at the closing of the PMX Transaction (see Note 10), for the sale of 5,882 units, each comprised of 1 share of common stock and 0.30 pre-funded warrants (the “Units”) at $850 per Unit. The Subscription Agreement includes a make-whole provision which requires the issuance of additional shares of common stock in the event that the 270-day volume weighted average price after the closing of the Subscription Agreement, is below $850, and the PMX Investor still holds the common shares acquired upon closing of the Subscription Agreement 270 days after such closing. The Subscription Agreement would only close upon obtaining Stockholder Approval for certain transactions involving the Company’s Series B Preferred Stock. The Subscription Agreement was amended on January 23, 2024 to include a provision for interest on the $5 million debenture, accruing at a rate of 4%, to be included in the calculation of the units to be issued upon the Conversion. Stockholder approval was obtained on September 5, 2024, and as a result, the Conversion and the issuance of 5,882 units, attributable to the Subscription Agreement, and 158 units, attributable to additional accrued interest under the debenture to the PMX Investor took place on September 24, 2024.

Due to the issuance, the make-whole took effect and remained in place until June 24, 2025 when the make whole expired and was settled. The Company issued 241,514 shares of common stock (the “Make-Whole Shares”) to Altos Venture AG, following the determination that the 270-day volume weighted average price (“Issuer VWAP”) was below the $850 threshold. The Company recorded common stock of $2 and additional paid in capital of $995,036 related to the issuance of the 241,514 shares in the accompanying condensed consolidated balance sheet as of June 30, 2025.

The Subscription Agreement was accounted for as a liability in accordance with ASC 480,Distinguishing Liabilities from Equity, (“ASC 480”), as the make-whole provision could result in a variable number of shares being issued upon settlement. The related party subscription agreement liability was measured at fair value at the commitment date and remeasured at each subsequent reporting period, with changes in fair value recorded as a component of other income (expense), net in the condensed consolidated statements of operations and comprehensive loss. As of June 30, 2025 and December 31, 2024, the fair value of the related party subscription agreement liability was approximately $0 and $4,123,000, respectively. For the six months ended June 30, 2025, the Company recognized a change in fair value of the related party subscription agreement liability of approximately $191,000 and $3,128,000.

The fair value was determined using a Monte-Carlo option pricing model, and as of December 31, 2024, the Company utilized 100% probability that the Subscription Agreement will close. The significant assumptions used in the Monte-Carlo model, which utilizes Level 3 inputs (see Note 3), are as follows as of December 31, 2024:

Note 8 — Convertible Preferred Stock and Stockholders’ Equity

Authorized Capital

As of June 30, 2025 and December 31, 2024, the Company is authorized to issue 250,000,000 shares and 10,000,000 shares of common stock and preferred stock, respectively, with a par value of $0.00001 for both common stock and preferred stock.

At June 30, 2025 and December 31, 2024, the Company had designated 1,150,000 shares,10,000 shares,2,700,000 shares, and 10,000 shares of Series Seed Preferred Stock, Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock, respectively.

Preferred Stock

Series Seed Convertible Preferred Stock

The Company has 1,150,000 shares of preferred stock designated as Series Seed Preferred Stock (“Series Seed”) and there areno shares of Series Seed outstanding as of June 30, 2025 and December 31, 2024.

Series A Convertible Preferred Stock

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

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

On September 24, 2024, Veru converted all 3,000 shares of Series A Convertible Preferred Stock into 1,679 shares of the Company’s common stock per the stated conversion ratio. There were 0 shares of Series A Convertible Stock outstanding as of June 30, 2025 and December 31, 2024.

Series B Convertible Preferred Stock

On December 15, 2023, the Company filed a Certificate of Designations of Rights and Preferences of Series B Convertible Preferred Stock of the Company (the “Series B Certificate of Designations”) with the State of Delaware to designate and authorize the issuance of up to 2,700,000 shares of Series B Preferred Stock.

On December 15, 2023, in connection with the PMX Transaction, as part of the purchase consideration, the Company issued 2,696,729 shares of Series B Convertible Preferred Stock. The Series B Preferred Stock was initially convertible into approximately 79,315 shares of the Company’s common stock, upon Stockholder Approval as defined in the Series B Certificate of Designation.

The Company evaluated the terms of the Series B Preferred Stock, and in accordance with the guidance of ASC 480, the Series B Preferred Stock was classified as temporary equity in the accompanying consolidated balance sheets, as the shares may be redeemable by the holders for cash, upon certain conditions that are not within the control of the Company. Additionally, the Company does not control the actions or events necessary to deliver the number of required shares upon exercise by the holders of the conversion feature. The Series B Preferred Stock was recorded at its fair value as of the issuance date. The Series B Preferred Stock was not previously redeemable or probable of becoming redeemable because it was subject to, among other things, Stockholder Approval as described above, and therefore the carrying amount was not accreted to its redemption value in prior periods.

On September 5, 2024, Stockholder Approval was obtained, and on September 24, 2024, the Company effected the conversion of all 2,696,729 shares of Series B Preferred Stock into 79,315 shares of the Company’s common stock.

Series C Convertible Preferred Sock

On October 1, 2024, the Board of Directors authorized the Company to create a series of 10,000 shares of preferred stock designated as “Series C Convertible Preferred Stock”, with a par value of $0.00001, pursuant to the certificate of designations. At any time after the initial issuance date of Series C convertible Preferred Stock, each Preferred Share shall be convertible into validly issued, fully paid and non-assessable shares of Common Stock. The holders of Series C Preferred Stock are entitled to dividends, on an as-if converted basis, equal to and in the same form as dividends actually paid on shares of Common Stock, when and if actually paid. In addition, from and after the occurrence and during the continuance of any Triggering Event, dividends (“Default Dividends”) will accrue on the Stated Value of each Preferred Share at a rate of fifteen percent (15.0%) (the “Default Rate”) per annum. Each holder is entitled to convert any portion of the outstanding Preferred Shares held by such holder into validly issued, fully paid and non-assessable Conversion shares at the Conversion Rate, which can be determined by dividing (x) the Conversion Amount of such Preferred Share by (y) the Conversion Price, $4.5056, subject to adjustment as provided in the Certificate of Designations.

After the Stockholder Approval Date, if a Triggering Event occurs and is continuing at any time after the earlier of the holders’ receipt of a Triggering Event Notice and such holder becoming aware of such Triggering Event (such earlier date, the “Alternate Conversion Right Commencement Date”) and ending on the twentieth (20 th) Trading Day after the later of (x) the date of such Triggering Event is cured and (y) such holder’s receipt of a Triggering Event Notice (such ending date, the “Alternate Conversion Right Expiration Date”), and each such period, an “Alternate Conversion Right Period”), such holder may, at such holder’s option, by delivery of a Conversion Notice to the Company (the date of any such Conversion Notice, each an “Alternate Conversion Date”), convert all, or any number of Preferred Shares held by such holder into shares of Common Stock at the Alternate Conversion Price (each, an “Alternate Conversion”). Alternate Conversion Price means, with respect to any Alternate Conversion that price will be the lowest of(i) the applicable Conversion Price as in effect on the applicable Conversion Date of the applicable Alternate Conversion, and (ii) the greater of (x) the Floor Price and (y) 80% of the lowest VWAP of the Common Stock during the five (5) consecutive Trading Day period ending and including the Trading Day immediately preceding the delivery or deemed delivery of the applicable Conversion Notice (such period, the “Alternate Conversion Measuring Period”).

At any time, the Company has the right to redeem in cash all or part of the Preferred Shares then outstanding at a price (the “Company Optional Redemption Price”) equal to 125% of the greater of (i) the Conversion Amount being redeemed and (ii) the product of (1) the Conversion Rate with respect to the Conversion Amount being redeemed multiplied by (2) the greatest closing sale price of the Company’s Common Stock on any Trading Day during the period commencing on the date immediately preceding the date the Company notifies the holders of its elections to redeem and the date the Company makes the entire payment required. Upon the occurrence of a Bankruptcy Triggering Event, the Company will immediately redeem, in cash, each of the Preferred Shares then outstanding at a redemption price equal to the greater of (i) the product of (A) the Conversion Amount to be redeemed multiplied by (B) 125% and (ii) the product of (X) the Conversion Rate with respect to the Conversion Amount in effect immediately following the date of initial public announcement of such Bankruptcy Triggering Event multiplied by (y) the product of (1) 125% multiplied by (2) the greatest closing sale price of the Common Stock on any Trading Day during the period commencing on the date immediately preceding such Bankruptcy Triggering Event and ending on the date the Company pays the entire payment required. The holders of the Series C Preferred Stock are entitled to be paid a cash amount equal to 30% of the gross proceeds in the event of any sale of common stock under the ELOC in accordance with the terms stated below within the ELOC securities purchase agreement.

In no event may any Preferred Shares be converted (or Warrants be exercised) and shares of Common Stock be issued to any holder if after giving effect to the issuance of shares of Common Stock upon such conversion of the Preferred Shares (or exercise of the Warrants), the holder (together with its affiliates, if any) would beneficially own more than 4.99% of the outstanding shares of Common Stock, which we refer to herein as the “PIPE Blocker”. The PIPE Blocker may be raised or lowered to any percentage not in excess of 9.99% at the option of the applicable holder of the Preferred Shares (or Warrants), except that any raise will only be effective upon 61-days’ prior notice to the Company.

During the three and six months ended June 30, 2025, the Company has redeemed approximately 0 and 1,369 Series C Preferred Stock for an aggregate amount of $0 and $1.71 million, respectively. As of June 30, 2025,2,130 shares of Series C Preferred Stock remain outstanding, with a carrying value of $0.44 million, as reflected in the accompanying condensed consolidated balance sheet.

Included in the outstanding balance are 329 shares of Series C Preferred Stock related to PIPE investors, for which $409,510 is recorded as "Due to Shareholders" in the condensed consolidated balance sheet at June 30, 2025. These shares pertain to equity line of credit (ELOC) draws made in April and June 2025 and were not converted or redeemed as of June 30, 2025. In July 2025, these 329 shares were subsequently converted into common stock at a conversion price of $3.50 per share. Since the conversion occurred after the reporting date, the shares are still considered outstanding as of June 30, 2025 and are included in the total 2,130 Series C shares reported.

Securities Purchase Agreement and ELOC

On October 2, 2024, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with six institutional and accredited investors. The Company sold an aggregate of i)3,499 Series C Preferred Stock, par value $0.00001 per share (the “Series C Redeemable Preferred Stock”), and (ii) a warrants to purchase 6,963 shares of common stock (the “Series C PIPE Warrants”), for aggregate cash proceeds of $2,000,000. The Warrants have an exercise price of $372.30 per share, subject to adjustment therein, and expire on the third anniversary of the initial exercisability date. The warrants issued with the Series C Redeemable Preferred Stock are accounted for as liabilities in accordance with ASC 815.

Concurrently, on October 2, 2024, the Company entered into a Common Stock Equity Line of Credit Purchase Agreement (the “ELOC Purchase Agreement”) with an institutional investor, whereby the Company may sell up to $25,000,000 of the Company’s new issued Common Stock. Pursuant to the ELOC Purchase Agreement, the investor shall purchase from the Company up to the lesser of (i) $25.0 million in shares of our Common Stock and (ii)19,512 shares, representing 19.99% of the total number of shares of Common Stock outstanding immediately prior to the execution of the ELOC Purchase Agreement. Pursuant to the ELOC Purchase Agreement,30% of the gross proceeds to the Company from any sale of common stock thereunder must be applied towards the redemption of the Series C Redeemable Preferred Stock.

Based on the terms of the Series C Redeemable Preferred Stock and the Company’s Certificate of Designation, and in accordance with ASC 480, the Series C Redeemable Preferred Stock is accounted for as mezzanine equity due to the contingent redemption feature upon any sale of common stock under the ELOC Purchase Agreement. The initial cash proceeds of $2,000,000 were allocated between the Series C Preferred Stock and derivative liability warrants, with the amount initially recorded in mezzanine equity based on the guidance in ASC 815 (i.e. the value of the derivative liability warrant is allocated its full fair value, and the residual is allocated to the Series C Redeemable Preferred Stock). The derivative liability warrants were measured at fair value at inception in the amount of $1,138,476 and the Series C Redeemable Preferred stock was measured at residual value of $861,524. The Series C Redeemable Preferred Stock is subsequently measured at redemption value as they occur, with the difference between the basis per share of $246.22 and redemption value per share recorded as a deemed dividend in the statements of operations.

During the year ended December 31, 2024, the Company received proceeds of $935,625 and recorded approximately $250,000 of shareholder receivable under the ELOC. In addition, the Company recorded a deemed divided in the amount of $206,404 in the consolidated statement of operations for the year ended December 31, 2024.

During the three and six months ended June 30, 2025, the Company received proceeds of $1,365,038 and $6,391,655 million under the ELOC and recorded a deemed divided in the amount of $328,504 and $1,498,595 in the condensed consolidated statements of operations.

Common Stock

As of June 30, 2025 and December 31, 2024 there were 1,009,126 and 138,422 shares of common stock issued, respectively, and 1,008,974 and 138,270 shares of common stock outstanding, respectively.

Treasury Stock

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

There wereno repurchases of common stock during the three and six months ended June 30, 2025 and 2024.

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

Deferred offering costs associated with the ATM Agreement are reclassified to additional paid in capital on a pro-rata basis when the Company completes offerings under the ATM Agreement. Any remaining deferred costs will be expensed to the statements of operations should the planned offering be abandoned.

As of December 31, 2024 and June 30, 2025, no shares have been sold under the ATM Offering, and the Company wrote off approximately $0.3 million of deferred offering costs in its consolidated balance sheets as of December 31, 2024.

Warrants

The following summarizes the Company’s outstanding warrants, excluding contingent warrants issuable upon exercise of the outstanding warrants as of June 30, 2025:

As of June 30, 2025, the Company had outstanding warrants, which are exercisable into 13,818 shares of common stock. The shares of common stock underlying the warrants outstanding had an exercise price of $568.38 per share.

Contingent Warrant Liabilities

As of June 30, 2025, the fair value of contingent warrant labilities includes the Series C PIPE warrants of $32,892 and those issuable upon exercise of the Inducement PIOs of approximately $20,221 totaling $53,113 included as contingent warrant liabilities in the accompanying condensed consolidated balance sheets.

As of December 31, 2024, the fair value of contingent warrant labilities includes the Series C PIPE warrants of $32,982 and those issuable upon exercise of the Inducement PIOs of approximately $10,200 totaling $43,089 included as contingent warrant liabilities in the accompanying condensed consolidated balance sheets.

The maximum number of warrants issuable upon settlement of the contingent warrants was 461 for the Inducement PIOs contingent warrants and 6,963 for the Series C PIPE warrants as of June 30, 2025 and December 31, 2024.

Onconetix Equity Incentive Plans

The Company’s 2019 Equity Incentive Plan (the “2019 Plan”) was adopted by its board of directors and by its stockholders on July 1, 2019. On February 23, 2022 the Company’s board of directors adopted the Company’s 2022 Equity Incentive Plan (the “2022 Plan”), which is the successor and continuation of the Company’s 2019 Plan. Under the 2022 Plan, the Company may grant stock options, restricted stock, restricted stock units, stock appreciation rights, and other forms of awards to employees, directors, and consultants of the Company. In May 2023, the number of shares of common stock reserved for issuance under the 2022 Plan was increased to 926, and in September 2024, the number of shares of common stock reserved for issuance under the 2022 Plan was increased to 17,058. Stock-based awards granted during the three and six months ended June 30, 2025 and 2024 were all granted under the 2022 Plan. As of June 30, 2025, there are 8,446 shares available for issuance under the 2022 Plan.

Stock Options

The following summarizes activity related to the Company’s stock options under the 2019 Plan and the 2022 Plan for the six months ended June 30, 2025:

There wereno stock options granted during the three and six months ended June 30, 2025 and 2024.

The aggregate fair value of stock options that vested during the three and six months ended June 30, 2025, was approximately $46,000 and $92,000, respectively, compared to $83,000 and $167,000 for the same periods in 2024.

Restricted Stock

On May 9, 2023, the Board’s Compensation Committee approved the issuance of restricted stock, granted under the Company’s 2022 Plan, to the Company’s executive officers, employees, and certain of the Company’s consultants. The restricted shares granted totaled 143, of which 44,22, and 44 were granted to the Company’s former CEO, former CFO, and former CBO, respectively. All of the restricted shares granted vest as follows:50% in January 2024,25% in August 2024, and 25% in August 2025. In addition, on May 31, 2023, the Board’s Compensation Committee approved the issuance of 7 shares of restricted stock, granted to the Company’s non-executive Board members, with full vesting on May 31, 2024. On February 14, 2024, in connection with the appointment of a non-executive Board member, the Company issued 1 share of restricted stock, which vested in full on June 14, 2024. Furthermore, on September 26, 2024, the Company issued its Board members a total of 195 restricted stock, with full vesting August 31, 2025. On February 24, 2025, in connection with the appointment of an executive Board member, the Company issued 20 shares of restricted stock with full vesting August 31, 2025.

The following summarizes activity related to the Company’s restricted stock awards granted under the 2022 Plan for the six months ended June 30, 2025:

Proteomedix Stock Option Plan

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

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

Note 8 — Convertible Preferred Stock and Stockholders’ Equity (cont.)

On April 16, 2024, the board of directors of Proteomedix approved a two-year extension of 144 vested stock options that were set to expire in April 2024. The extended expiration date for these options is April 18, 2026. The Company recorded approximately $18,000 of expense associated with this modification during the year ended December 31, 2024.

There was no activity under the PMX Option Plan for the three and six months ended June 30, 2025. In October 2024,684 stock options were converted to shares with a weighted average exercise price of $294.10. As of December 31, 2024 and June 30, 2025, there wereno outstanding stock options.

Stock-Based Compensation

Stock-based compensation expense related to stock options and restricted stock, for the three and six months ended June 30, 2025 and 2024 was as follows:

Note 9 — Commitments and Contingencies

Office Lease

Proteomedix leases office and lab space in Zurich Switzerland. On April 1, 2024, the original lease was amended to add additional office and laboratory space. The lease amendment was accounted for as a separate lease, resulting in an additional right-of-use asset and lease liability of approximately $88,000.

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

As of June 30, 2025, the remaining leases resulted in a right-of-use asset and lease liability of approximately $21,400. Lease payments for the remainder of the year ending December 31, 2025, are approximately $21,000. The impact of these leases is considered immaterial to the Company’s condensed consolidated financial statements.

Litigation

From time to time, the Company may be subject to various legal proceedings and claims that arise in the ordinary course of its business activities. As of June 30, 2025, the Company is not a party to any material legal proceedings and is not aware of any pending or threatened claims.

Note 9 — Commitments and Contingencies(cont.)

Registration Rights Agreements

In connection with private placements consummated in April 2022 and August 2022, the Company entered into Registration Rights Agreements with the purchasers. Upon the occurrence of any Event (as defined in each Registration Rights Agreement), which, among others, prohibits the purchasers from reselling the securities for more than ten consecutive calendar days or more than an aggregate of fifteen calendar days during any 12-month period, and should the registration statement cease to remain continuously effective, the Company would be obligated to pay to each purchaser, on each monthly anniversary of each such Event, an amount in cash, as partial liquidated damages and not as a penalty, equal to the product of 2.0% multiplied by the aggregate subscription amount paid by such purchaser in the private placements. As of June 30, 2025 and December 31, 2024, and as a result of the consummation of the remaining warrants associated with the April 2022 and August 2022 private placements, the Company has no further obligations pertaining to the Registration Rights Agreements.

Indemnification

In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future but have not yet been made. To date, the Company has not been required to defend any action related to its indemnification obligations. However, during the third quarter of 2023, the Company received a claim from its former CEO and a former accounting employee requesting advancement of certain expenses. The Company recorded approximately $209,000 in related expenses during the year ended December 31, 2023, of which approximately $159,000 was paid through reduction of the outstanding related party receivable due from the former CEO. The Company recorded a related accrual of approximately $50,000, which was included in accrued expenses at December 31, 2023, and which was paid during 2024, and accordingly there is no related accrual as of June 30, 2025. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is not estimable at this time.

Note 10 — Related Party Transactions

On December 18, 2023, the Company entered into the Subscription Agreement with the PMX Investor, a 5% stockholder of the Company as of June 30, 2025 (see Note 7). During the year ended December 31, 2024, the Company issued a non-convertible debenture in the principal amount of $5.0 million to the PMX Investor, in connection with the Subscription Agreement and has settled the principal and accrued interest through the issuance of shares (see Note 6).

On February 6, 2024, the Company appointed Thomas Meier, PhD, as a member of the Company’s board of directors. Dr. Meier provides consulting services to Proteomedix, through a consulting agreement that was effective January 4, 2024. On June 17, 2025, the Company entered into a separate consulting agreement with a firm affiliated with Dr. Meier. The agreement provides for the payment of certain success fees and reimbursement of related expenses. Dr. Meier is entitled to receive 10% of success fees earned by the affiliated firm. The Company recorded approximately $10,000 and $34,000 in related expenses during the three and six months ended June 30, 2024, respectively. No related expenses were recorded during the three or six months ended June 30, 2025. As of June 30, 2025, and December 31, 2024, no amounts related to this agreement were included in accounts payable.

Note 11 — Income Taxes

The Company’s tax provision for interim periods is determined using an estimate of the annual effective tax rate, adjusted for discrete items arising in that quarter. In each quarter, management updates the estimate of the annual effective tax rate, and any changes are recorded in a cumulative adjustment in that quarter. The quarterly tax provision and quarterly estimate of the annual effective tax rate are subject to significant volatility due to several factors, including management’s ability to accurately predict the portion of income (loss) before income taxes in multiple jurisdictions, and the effects of acquisitions and the integration of those acquisitions.

There wasno income tax provision or benefit recorded for the three and six months ended June 30, 2025. For the three and six months ended June 30, 2024, the Company recorded an income tax (expense) benefit of approximately $(51,000) and $71,000, respectively. This tax (expense) benefit was related to the Company’s deferred foreign taxes resulting from the Proteomedix acquisition and yielded an effective tax rate of 12.0% for Proteomedix for the six months ended June 30, 2024.

The Company has incurred net operating losses for all of the periods presented and has not reflected any benefit in the accompanying condensed consolidated financial statements for its U.S. net operating loss carryforwards and only a partial benefit for its Swiss net operating loss carryforwards due to uncertainty around utilizing these tax attributes within their respective carryforward periods. The Company has recorded a full valuation allowance against its U.S. deferred tax assets as it is not more likely than not that such assets will be realized in the near future. As of December 31, 2024, all deferred tax liabilities, related to intangibles, on the books have been reversed creating an income tax benefit. All remaining deferred tax assets and deferred tax liabilities have a full valuation allowance booked against them therefore there were no additional income tax benefits during the three and six months ended June 30, 2025.

The Company’s policy is to recognize interest expense and penalties related to income tax as income tax expense. For the three and six months ended June 30, 2025 and 2024, the Company hasnot recognized any interest or penalties related to income taxes.

Note 12 — Net Loss Per Share

Basic net loss per share is computed by dividing the net income or loss applicable to common shares by the weighted average number of common shares outstanding during the period. The weighted average number of shares of common stock outstanding includes pre-funded warrants because their exercise requires only nominal consideration for delivery of shares; it does not include any potentially dilutive securities or any unvested restricted shares of common stock. Certain restricted shares, although classified as issued and outstanding at June 30, 2025, are considered contingently returnable until the restrictions lapse and will not be included in the basic net loss per share calculation until the shares are vested. Unvested shares of the Company’s restricted stock do not contain non-forfeitable rights to dividends and dividend equivalents.

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

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

Note 13 — Defined Benefit Plan

Proteomedix sponsors a defined benefit pension plan (the “Swiss Plan”) covering certain eligible employees. The Swiss Plan provides retirement benefits based on years of service and compensation levels.

The following significant actuarial assumptions were used in calculating the benefit obligation and the net periodic benefit cost as of June 30, 2025 and December 31, 2024:

Changes in these assumptions may have a material impact on the plan’s obligations and costs.

The components of net periodic benefit cost for the three and six months ended June 30, 2025 and 2024, which is included within selling, general and administrative expenses in the accompanying condensed consolidated statements of operations and comprehensive loss, are as follows:

During the three months ended June 30, 2025 and 2024, the Company made pension contributions of approximately $21,000 and $22,000, respectively.

During the six months ended June 30, 2025 and 2024, the Company made pension contributions of approximately $42,000 and $43,000, respectively.

Note 13 — Defined Benefit Plan (cont.)

The components of accumulated comprehensive loss attributable to the Company’s pension plan for the three and six months ended June 30, 2025 and 2024 are as follows:

As of June 30, 2025 and December 31, 2024, the funded status of the plan and the amounts recognized in the accompanying consolidated balance sheet are as follows:

A reconciliation of the beginning and ending balances of the accumulated benefit obligation is provided in the table below:

Note 13 — Defined Benefit Plan (cont.)

A reconciliation of the beginning and ending balances of the plan assets is provided in the table below:

Projected benefit payments for the next five years as of June 30, 2025 are as follows:

Note 14 – Segment Information

The Company conducts its business activities and reports financial results asone business segment. The presentation of financial results as one reportable segment is consistent with the way the Company operates its business and is consistent with the manner in which the Chief Operating Decision Maker (“CODM”) evaluates performance and makes resource and operating decisions for the business. The Company’s CODM is the Chief Executive Officer. Furthermore, the Company notes that monitoring financial results as one reportable segment helps the CODM manage costs on a consolidated basis, consistent with the integrated nature of the operations. The CODM uses net loss, as reported on the Consolidated Statements of Operations and Comprehensive Loss, in evaluating performance of the Company and determining how to allocate resources of the Company as a whole. As the CODM evaluates performance on a consolidated basis, all required financial segment information is included in the consolidated financial statements.

Geographic Information

The distribution of revenue by geographical area was as follows:

Note 15 — Subsequent Events

Ocuvex Merger Agreement

On July 16, 2025, the Company entered into an Agreement and Plan of Merger with (i) Onconetix Merger Sub, Inc., a Delaware corporation and a direct, wholly owned subsidiary of the Company, and (ii) Ocuvex Therapeutics, Inc., a Delaware corporation (“Ocuvex”, and such agreement, the “Merger Agreement”). Pursuant to the Merger Agreement, Merger Sub will merge with and into Ocuvex, with Ocuvex surviving the merger as a direct, wholly owned subsidiary of the Company (the “Merger” and the other transactions contemplated by the Merger Agreement, the “Transactions”).

Upon the consummation of the Transactions (the “Closing”), each share of common stock, par value $0.0001 per share, of Ocuvex (the “Ocuvex Common Stock”) shall be exchanged into a number of shares of common stock, par value $0.00001 per share, of the Company (the “Company Common Stock”) equal to the Exchange Ratio (as defined below) (such shares, the “Merger Consideration”), subject to adjustment as described below and the reduction of the Escrow Shares (as defined below) in respect of the satisfaction of indemnification obligations.

As a result of the Transactions, it is anticipated that immediately following the Closing, (i) the pre-Closing Ocuvex stockholders will own 90% of the issued and outstanding equity interests of the Company, on a fully diluted basis, and (ii) the pre-Closing Company stockholders will own 10% of the issued and outstanding equity interests of the Company, on a fully-diluted basis, subject to adjustment in respect of Permitted Financing (as defined below).

“Exchange Ratio” means a number equal to the quotient obtained by dividing (x) the product of (I) the fully diluted Company Common Stock less the aggregate number of shares of Company Common Stock issuable in connection with a Permitted Financing and (II) 9 by (y) the fully diluted Ocuvex Common Stock.

“Permitted Financing” means an equity or debt financing transaction or series of equity or debt financing transactions entered into by Parent prior to Closing in connection with the Transactions, the proceeds of which Parent loans to the Company prior to the Effective Time.

At Closing, a number of shares of Company Common Stock equivalent to 12.5% of the Merger Consideration (together with any equity securities paid as dividends or distributions with respect to such shares or into which such shares are exchanged or converted, the “Escrow Shares”) shall be deposited in a segregated escrow account along with any other dividends, distributions or other income on the Escrow Shares (together with the Escrow Shares, the “Escrow Property”). The Escrow Property shall be sole source of payment for all claims for indemnification by the Company (other than for claims based on fraudulent, criminal or intentional misconduct). Following the Expiration Date and the resolution of any pending indemnification claims, the remaining amount of Escrow Property shall be distributed to the pre-Closing Ocuvex stockholders, on a pro rata basis.

The Closing is subject to the satisfaction or waiver of customary conditions, including, among other things, (i) receipt of the required approval of the Company stockholders and the adoption of the Merger Agreement and the Transactions by the requisite vote of the Ocuvex stockholders; (ii) the accuracy of the representations and warranties of the parties made in the Merger Agreement, subject to customary materiality qualifiers; (iii) compliance by the parties with their respective covenants and agreements under the Merger Agreement; (iv) the approval for listing on Nasdaq of the Company Common Stock to be issued as the Merger Consideration; (v) the registration statement for the Merger having been declared effective and (v) the absence of a material adverse effect with respect to the other party.

Ocuvex’s obligation to complete the Closing is subject to additional conditions, including (i) the restructuring of certain outstanding indebtedness of the Company and (ii) a condition that the Merger qualifies as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986.

The Company’s obligation to complete the Closing is subject to additional conditions, including (i) the satisfaction of certain other obligations of Ocuvex with respect to third-party consents under existing contracts and (ii) that certain lock-up agreements, the Escrow Agreement and the certain stockholder support agreements are in full force and effect.

Onconetix and Ocuvex intend to file with the SEC a registration statement on Form S-4, which will include a preliminary proxy statement of Onconetix and a prospectus in connection with the proposed Merger between Onconetix and Ocuvex pursuant to the Merger Agreement.

Series C Preferred Stock Conversion and Price Reduction

On July 16, 2025, the Company exercised its voluntary Series C adjustment right to lower the conversion price of the Series C preferred stock to $3.50, and holders of 2,130 Series C shares agreed to convert their shares into shares of common stock. As of August 13, 2025,1,920 shares of Series C preferred stock had been converted to 547,051 shares of common stock for an aggregate conversion amount of approximately $1.9 million.

Keystone Note Payable

On August 6, 2025, the Company issued a promissory note to Keystone Capital Partners, LLC with original issue discount of $17,647.06, in an aggregate principal amount of $117,647.06. The note is due and payable upon the earlier of (i) the Company’s receipt of sufficient proceeds from the ELOC and (ii) March 6, 2026, subject to mandatory prepayment in the event that the Company raises sufficient additional capital through other securities offerings. The note is subordinate to the Company’s existing debt obligations to Veru Inc. The note does not initially bear interest, however, any amounts due under the note which are not paid when due shall incur a late charge of 15% per annum until such amount is paid in full.

August 2025 Amendment and Restatement of September Veru Note

On August 7, 2025, Veru and the Company agreed to amend and restate the September Veru Note (as amended and restated, the “A&R September Veru Note”). Pursuant to the A&R September Veru Note, the principal amount owed to Veru was increased by $100,000 to an aggregate principal amount of $5.1 million, and the maturity date was amended to August 14, 2025. All other terms of the September Veru Note remained the same.