Raphael Pharmaceutical Inc.

Previous wording

The foregoing does not represent an exhaustive list of matters that may be covered by the forward-looking statements contained herein or risk factors that we are faced with that may cause our actual results to differ from those anticipated in our forward-looking statements. Please see “Item 1A. Risk Factors” in Part I of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, as well as “Item 1A. Risk Factors” in Part II of this Quarterly Report for additional risks that could adversely impact our business and financial performance.

Current wording

The foregoing does not represent an exhaustive list of matters that may be covered by the forward-looking statements contained herein or risk factors that we are faced with that may cause our actual results to differ from those anticipated in our forward-looking statements. Please see “Item 1A. Risk Factors” in Part I of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 for additional risks that could adversely impact our business and financial performance.

Previous wording

We have recently completed a proof-of-concept clinical study, or Study, for our lead product candidate for the treatment of RA in the United States. Encouraged by the promising results of the Study, we will continue to investigate our product for the treatment of autoimmune diseases.

Current wording

In December 2024 we completed a proof-of-concept clinical study, or Study, for our lead product candidate for the treatment of RA in the United States. Encouraged by the promising results of the Study, we will continue to investigate our product for the treatment of autoimmune diseases.

Previous wording

In November 2022, we submitted a proposal to the MOH for a clinical trial of a cannabis-based drug intended to alleviate the deterioration of COVID-19 patients.

Current wording

In November 2022, we submitted a proposal to the Ministry of Health of Israel, or MOH for a clinical trial of a cannabis-based drug intended to alleviate the deterioration of COVID-19 patients.

Previous wording

In April 2024 we began the Study in the United States, leveraging insights from the pre-clinical experiments we have conducted at the Rambam. This Study aimed to evaluate the Company’s Cannabinoid based formula, or Raphael’s Formula, in patients with active RA. The single-group Study was managed by MindMate, Inc./ dba Citruslabs, or Citruslabs, and conducted in Santa Monica, California, United States, under Institutional Review Board, or IRB, approval, in compliance with applicable FDA regulations and in accordance with applicable industry standards and regulations. An IRB is an appropriately constituted group that has been formally designated to review and monitor biomedical research involving human subjects.

Current wording

In April 2024 we began the Study in the U.S., leveraging insights from the pre-clinical experiments we have conducted at the Rambam. This Study aimed to evaluate the Company’s Cannabinoid based formula, or Raphael’s Formula, in patients with active RA. The single-group Study was managed by MindMate, Inc. dba Citruslabs, or Citruslabs, and conducted in Santa Monica, California, U.S., under Institutional Review Board, or IRB, approval, in compliance with applicable FDA regulations and in accordance with applicable industry standards and regulations. An IRB is an appropriately constituted group that has been formally designated to review and monitor biomedical research involving human subjects.

Previous wording

On December 23, 2024, upon successful completion of the Study, we received the Study results with overall findings that emphasize the clinical potential of Raphael’s Formula and suggest that it may have beneficial effects on symptom management and overall well-being for individuals with RA. For more information about the Study results, see “Item 1. Business - Research and Clinical Development Strategy”.

Current wording

On December 23, 2024, upon a successful completion of the Study, we received the Study results with overall findings that emphasize the clinical potential of Raphael’s Formula and suggest that it may have beneficial effects on symptom management and overall well-being for individuals with RA. For more information about the Study results, see “Item 1. Business - Research and Clinical Development Strategy”.

Previous wording

In August 2025, the company announced the completion of product development and the launch of its proprietary natural formula under the “RaphaWell” brand for RA support in the United States. This follows the successful completion of a clinical trial conducted under IRB approval and in full compliance with FDA regulations, including participants with Severe RA, as mentioned above. The finalized “RaphaWell” product, will be sold as a standalone clinically tested dietary supplement targeting the growing wellness market. The “RaphaWell” formula is 100% natural, plant-based, and was associated with no reported side effects during the Study, addressing a significant unmet need in RA symptom management. Raphael’s “RaphaWell” formula has undergone clinical testing, which to our belief, proved its credibility and efficacy. We believe that “RapahWell” formula holds strong commercial potential and first- mover advantage. Study information on will be available to consumers via QR code on the product packaging.

Current wording

In August 2025, we announced the completion of product development and the launch of our proprietary natural formula under the “RaphaWell” brand for RA support in the U.S. This follows the successful completion of a clinical trial conducted under IRB approval and is in full compliance with FDA regulations, including participants with severe RA. The finalized “RaphaWell” product is intended be sold as a standalone clinically tested dietary supplement targeting the growing wellness market. The “RaphaWell” formula is 100% natural, plant-based, and was associated with no reported side effects during the Study, addressing a significant unmet need in RA symptom management. Raphael’s “RaphaWell” formula has undergone clinical testing, which to our belief, proved its credibility and efficacy.

Previous wording

For this purpose, in October 2022, we entered into an agreement with the Medical Cannabis Research Center at Rambam for the development of a new, patentable formulation that combines purified cannabinoids to treat rheumatoid diseases.

Current wording

For this purpose, in October 2022, we entered into an agreement with the Medical Cannabis Research and Innovation Center at Rambam for the development of a new, patentable formulation that combines purified cannabinoids to treat rheumatoid diseases.

Previous wording

Following the completion of the Study, we intend to submit an IND application to the FDA and MOH. See “Item 1. Business - Research and Clinical Development Strategy - Clinical Development Plan” for additional information on the ongoing pre-clinical trial and our planned clinical trial for our RA product candidate.

Current wording

Following the completion of the Study, we intend to submit an Investigational New Drug, or IND, application to the FDA and MOH. See “Item 1. Business - Research and Clinical Development Strategy - Clinical Development Plan” for additional information on the ongoing pre-clinical trial and our planned clinical trial for our RA product candidate.

Previous wording

As a pharmaceutical research and clinical development company we do not own or operate, and currently do not intend on creating an in-house team to manufacture and commercialize our pharmaceutical drug products, if any, that receive regulatory approval allowing for commercialization. We currently rely, and expect to continue to rely, on third parties for the manufacturing of our product candidates for preclinical and clinical testing, as well as for commercial manufacturing of any pharmaceutical drug products for which we may receive regulatory approval. Subject to the receipt of such regulatory approvals, we intend on cooperating with manufacturers and other third parties to manufacture and commercialize approved pharmaceutical drug products.

Current wording

In addition, with respect to our COVID-19 product candidate, our clinical research partners have been focused on the effect of cannabinoids and cannabis extracts on immune cells which induce acute inflammation. This study will begin in the pre-clinical level in immune cell models and, subject to positive results that exhibit downregulation of pro-inflammatory cytokines by cannabis extract, the study was completed successfully. Following the completion of the pre-clinical study, a mice model was conducted to analyze for acute inflammation, which resembles the immunopathology of COVID-19. The mice model was successfully completed and we have registered for a clinical trial in patients with the MOH.As a pharmaceutical research and clinical development company we do not own or operate, and currently do not intend on creating an in-house team to manufacture and commercialize our pharmaceutical drug products, if any, that receive regulatory approval allowing for commercialization. We currently rely, and expect to continue to rely, on third parties for the manufacturing of our product candidates for preclinical and clinical testing, as well as for commercial manufacturing of any pharmaceutical drug products for which we may receive regulatory approval. Subject to the receipt of such regulatory approvals, we intend on cooperating with manufacturers and other third parties to manufacture and commercialize approved pharmaceutical drug products.

Previous wording

Research and Development Expenses. Our research and development expenses totaled $286,000 for the nine months ended September 30, 2025, representing a decrease of $279,000, or 49%, compared to $565,000 for the nine months ended September 30, 2024. The decrease was primarily attributable to decrease in expenses related to the research agreement with Rambam.

Current wording

Research and Development Expenses. Our research and development expenses totaled $37,000 for the three months ended March 31, 2026, representing a decrease of $35,000, or 49%, compared to $72,000 for the three months ended March 31, 2025. The decrease was primarily attributable to a decrease in our chief Technology Officer's compensation.

Previous wording

Operating Loss. Our operating loss totaled $251,000 for the three months ended September 30, 2025, representing a decrease of $68,000, or 21%, compared to $319,000 for the three months ended September 30, 2024. The decrease was primarily due to the decrease in our research and development expenses.

Current wording

Operating Loss. Our operating loss totaled $223,000 for the three months ended March 31, 2026, representing a decrease of $202,000, or 48%, compared to $425,000 for the three months ended March 31, 2025. The decrease was primarily due to a decrease in our research and development expenses, and a decrease in our general and administrative costs.

Previous wording

*Financial expense, net.*We recognized financial expense, net, of $4,000 for the three months ended September 30, 2025, representing a decrease of $3,000, or 43%, compared to financial expense, net of $7,000 for the three months ended September 30, 2024. The increase was primarily due to exchange differences.

Current wording

*Financial expense, net.*We recognized financial expense, net, of $6,000 for the three months ended March 31, 2026, representing an increase of $2,000, or 50%, compared to financial expense, net of $4,000 for the three months ended March 31, 2025. The Company considers the increase to be immaterial.

Previous wording

Net Loss. As a result of the foregoing, our net loss totaled $255,000 for the three months ended September 30, 2025, representing a decrease of $71,000, or 22%, compared to $326,000 for the three months ended September 30, 2024. The decrease was primarily due to the decrease in our research and development expenses.

Current wording

Net Loss. As a result of the foregoing, our net loss totaled $229,000 for the three months ended March 31, 2026, representing a decrease of $200,000, or 47%, compared to $429,000 for the three months ended March 31, 2025. The decrease was primarily due to a decrease in our research and development expenses and a decrease in our general and administrative costs.

Previous wording

Since inception, we have funded our operations primarily through our founder’s capital and capital received from Easy Energy, Inc. As of September 30, 2025, we had $3,000 in cash and cash equivalents, and have invested most of our available cash funds in ongoing cash accounts.

Current wording

Since inception, we have funded our operations primarily through our founder’s capital and capital received from Easy Energy, Inc. As of March 31, 2026, we had $1,000 in cash and cash equivalents, and have invested most of our available cash funds in ongoing cash accounts.

Previous wording

Net cash used in operating activities was $256,000 for the nine months period ended September 30, 2025, compared with net cash used in operating activities of $470,000 for the corresponding period in 2024. The decrease in the net cash used in operating activities during the nine months period ended September 30, 2025, compared to the same period in 2024, was primarily due to an increase in share-based payment in exchange for services.

Current wording

Net cash used in operating activities was $44,000 for the three-months period ended March 31, 2026, compared with net cash used in operating activities of $209,000 for the corresponding period in 2025. The decrease in the net cash used in operating activities during the three-months period ended March 31, 2026, compared to the same period in 2025, was primarily due to a decrease in our net loss, offset by eliminating share based compensation and an increase in account payables.

Previous wording

There was no net cash used in investing activities for the nine months period ended September 30, 2025 and for the same period in 2024.

Current wording

There was no net cash used in investing activities for the three months period ended March 31, 2026 and for the same period in 2025.

Previous wording

Net cash provided by financing activities for the nine months period ended September 30, 2025 was $240,000 compared to $280,000 for the same period in 2024. The decrease in net cash provided by financing activities during the nine months period ended September 30, 2025 compared to the corresponding period in 2024 was mainly due to a decrease in funds from issuance of shares and warrants.

Current wording

There was no net cash used in financing activities for the three months period ended March 31, 2026 compared to $240,000 for the same period in 2025. The decrease in net cash provided by financing activities during the three months period ended March 31, 2026 compared to the corresponding period in 2025 was due to a decrease in issuance of common stock and warrants.

Previous wording

Pursuant to the Research Agreement, we agreed to pay Rambam $1.4 million in four equal payments, due on the first day of August on each successive year from 2019 through 2022. Pursuant to the Supplement Agreement, we agreed to pay Rambam $960,000 plus VAT in four biannual payments from May 2023 through December 2024. Such amount was later amended to $470,000 plus VAT, out of which we paid $120,000. Furthermore, in accordance with the terms of the Research Agreement, we and Rambam will have joint ownership of any intellectual property (IP) created as a result of research programs covered by such agreement. In connection with the Research Agreement, Rambam agreed not to work, study or develop any technologies with other entities that compete with our work with Rambam for our COVID-19 product candidate or RA product candidate for a term of three and seven years, respectively, from the end of the parties’ collaboration with respect to the COVID-19 product candidate and seven years from the end of the term of the Research Agreement with respect to the RA product candidate.

Current wording

On July 17, 2019, we entered into a sponsored Research Agreement with Rambam, pursuant to which the Company agreed to fund a research project, to be performed by Rambam, with a research plan aimed at identifying the effects of different cannabis strains on the function of immune cells. On October 28, 2020, the Company and Rambam agreed to expand the research plan to study the anti-inflammatory activities of cannabis extracts in an RA mouse model. On February 15, 2021, the Company and Rambam agreed to further expand the research plan to study the effect of cannabis extracts on the immunopathology of the COVID-19 disease. The sponsored Researched Agreement is for an initial term of 48 months. On October 23, 2022, the Company and Rambam entered into a supplement to the Research Agreement, or the Supplement Agreement, pursuant to which the Company exercised an option to extend the Research Agreement by additional two years until December 31, 2024.Pursuant to the Research Agreement, we agreed to pay Rambam $1.4 million in four equal payments, due on the first day of August on each successive year from 2019 through 2022. Pursuant to the Supplement Agreement, we agreed to pay Rambam $960,000 plus VAT in four biannual payments from May 2023 through December 2024. Such amount was later amended to $470,000 plus VAT out of which we paid $120,000. Furthermore, in accordance with the terms of the Research Agreement, we and Rambam will have joint ownership of any IP created as a result of research programs covered by such agreement. In connection with the Research Agreement, Rambam agreed not to work, study or develop any technologies with other entities that compete with our work with Rambam for our COVID-19 product candidate or RA product candidate for a term of three and seven years, respectively, from the end of the parties’ collaboration with respect to the COVID-19 product candidate and seven years from the end of the term of the Research Agreement with respect to the RA product candidate. Subject to commercial sales of any product candidate using the IP created as a part of the research covered by such agreement, Raphael Israel is required to pay Rambam a royalty in an amount equal to 6% of all net sales, subject to certain deductions, such as taxes paid by any purchaser, transportation and shipping costs, and other customary deductions.

Previous wording

On December 25, 2023, the Company received an extension to pay the remaining $350,000 pursuant to the Research Agreement until the end of June 2024, however, since the remaining amount was not paid on time, an additional amount of $57,000 was added to the remaining balance. On July 28, 2025, the Company received an extension to pay the remaining balance until the end of April 2026. As of the date of this Quarterly Report, the Company has made all four of the four equal payments due pursuant to the Research Agreement, for a total amount of $1.4 million and $295,000 for the Supplement Agreement (out of the remaining $577,000). The outstanding balance is $282,000.

Current wording

On December 25, 2023, the Company received an extension to pay the remaining $350,000 pursuant to the Research Agreement until the end of June 2024, however, since the remaining amount was not paid on time, an additional amount of $57,000 was added to the remaining balance. On July 28, 2025, the Company received an extension to pay the remaining balance until the end of April 2026. As of the date of this Quarterly Report, the Company has made all four of the four equal payments due pursuant to the Research Agreement, for a total amount of $1.4 million and $295,000 for the Supplement Agreement (out of the remaining $577,000). As of the date of this Quarterly Report, the outstanding balance is approximately $300,000 and VAT (based on the NIS-USD exchange rate on March 31, 2026).

Previous wording

As of September 30, 2025, our cash and cash equivalents were $3,000. We believe that our existing cash and cash equivalents will not be sufficient to fund our projected cash requirements through the fourth quarter of 2025. Therefore, we will require significant additional financing in the near future to fund our operations. We currently anticipate that we will require approximately $500,000 for research and development activities over the course of the next 12 months. We also anticipate that we will require approximately $300,000 for capital expenditures over such 12-month period, which consists primarily of expenditures for clinical trials and general Company operating costs.

Current wording

As of March 31, 2026, our cash and cash equivalents were $1,000. We believe that our existing cash and cash equivalents will be sufficient to fund our projected cash requirements through the third quarter of 2026. Therefore, we will require significant additional financing in the near future to fund our operations. We currently anticipate that we will require approximately $1 million for research and development activities over the course of the next 12 months. We also anticipate that we will require approximately $1 million for capital expenditures over such 12-month period, which consists primarily of expenditures for clinical trials and general Company operating costs.