MILESTONE SCIENTIFIC INC.

FORWARD-LOOKING STATEMENTS

When used in this Quarterly Report on Form 10-Q, the words “may”, “will”, “should”, “expect”, “believe”, “anticipate”, “continue”, “estimate”, “project”, “intend” and similar expressions are intended to identify forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) regarding events, conditions and financial trends that may affect Milestone Scientific’s future plans of operations, business strategy, results of operations and financial condition. Milestone Scientific wishes to ensure that such statements are accompanied by meaningful cautionary statements pursuant to the safe harbor established in the Private Securities Litigation Reform Act of 1995. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. Milestone Scientific’s plans and objectives are based, in part, on assumptions involving the continued expansion of its business. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of Milestone Scientific. Although Milestone Scientific believes that its assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate. Considering the significant uncertainties inherent in the forward-looking statements included herein, our history of operating losses that are expected to continue, requiring additional funding which we may be unable to raise capital when needed (which may force us to delay, curtail or eliminate commercialization efforts of our CompuFlo Epidural Computer Controlled Anesthesia System), the early stage operations of and relative lack of acceptance of our medical products, relying exclusively on two third parties to manufacture our products, changes to our distribution arrangements exposes us to risks of interruption of marketing efforts and building new marketing channels, changes in our informal manufacturing arrangements made by the manufacturer of our products and disruptions at the manufacturing facility of our manufacturers, including shortages of or delays in obtaining chips and other components, exposes us to risks that may harm our business, raising additional funds by issuing securities or through licensing or lending arrangements may cause dilution to our existing stockholders, restrict our operations or require us to relinquish proprietary rights, if physicians do not accept or use our CompuFlo Epidural Computer Controlled Anesthesia System, our ability to generate revenue from sales will be materially impaired, exposure to the risks inherent in international sales and operations, including China, the changing tariff and trade policies of the United States and China, and developments by competitors may render our products or technologies obsolete or non-competitive, the inclusion of such information should not be regarded as a representation by Milestone Scientific or any other person that the objectives and plans of Milestone Scientific will be achieved. Prospective investors are cautioned that any forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties and the actual results may differ materially from those included within the forward-looking statements because of various factors. Except as required by the federal securities laws, Milestone Scientific undertakes no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, to reflect events or circumstances occurring after the date of this Annual Report on Form 10-K. Milestone Scientific is the owner of the following registered U.S. trademarks: CompuDent®; CompuMed®; CompuFlo®; DPS Dynamic Pressure Sensing technology®; Milestone Scientific ®; CathCheck®; the Milestone logo ®; SafetyWand®; STA Single Tooth Anesthesia Device®; and The Wand ®.

Part I- Financial Information

CONDENSED CONSOLIDATED BALANCE SHEETS

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

FOR THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR SIX MONTHS ENDED

MILESTONE SCIENTIFIC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE1 — ORGANIZATION AND BUSINESS

All references in this report to “Milestone Scientific,” “us,” “our,” “we,” the “Company” or “Milestone” refer to Milestone Scientific Inc., and its consolidated subsidiaries, Wand Dental, Inc., and Milestone Innovations Inc. and Milestone Education LLC (all described below), unless the context otherwise indicates. Milestone Scientific is the owner of the following registered U.S. trademarks: CompuDent®; CompuMed®; CompuFlo®; DPS Dynamic Pressure Sensing technology®; Milestone Scientific®; the Milestone logo®; SafetyWand®; STA Single Tooth Anesthesia System®; and The Wand®.

Milestone Scientific was incorporated in the State of Delaware in* August 1989.Milestone Scientific has developed a proprietary, computer-controlled anesthetic delivery device, usingThe Wand*®, a single use disposable handpiece. The device is marketed in dentistry under the trademarksCompuDent®* andSTA Single Tooth Anesthesia System*®, and in medicine under the trademarkCompuMed®. CompuDent® is suitable for all dental procedures that require local anesthetic.CompuMed® is suitable for many medical procedures regularly performed in plastic surgery, hair restoration surgery, podiatry, colorectal surgery, dermatology, orthopedics, and many other disciplines. The dental devices are sold in the United States, Canada and in 49 other countries. Certain medical devices have obtained CE mark approval and can be marketed and sold in most European countries. In** June 2017,** Milestone Scientific received510(k) marketing clearance from the U.S. Food and Drug Administration (FDA) on theCompuFlo® Epidural Computer Controlled Anesthesia System (“Epidural”).

NOTE2--GOING CONCERN AND LIQUIDITY

Our financial statements have been prepared in conformity with generally accepted accounting principles which contemplate continuation of the Company on a going concern basis. The going concern basis assumes that assets are realized, and liabilities are extinguished in the ordinary course of business at amounts disclosed in the unaudited condensed financial statements.

The Company has incurred total losses since the inception of $131.5 million. The Company’s operating losses were approximately $1.5 million and $3.5 million, for thethree andsix months ending* June 30 2025,respectively. On June 30, 2025,Milestone Scientific had cash and cash equivalents of approximately $1.3 million and working capital of approximately $3.9 million. For thesix* months ending* June 30, 2025and2024,* we had cash flows used in operating activities of approximately $2.8 million and $0.4 million, respectively.

Based on our available cash and cash equivalents, recurring losses, accumulated deficit and the need to raise additional capital to finance operations, including proceeds received from the note financing received in* April 2025,as of June 30, 2025,we have concluded that there is substantial doubt about our ability to continue as a going concern for a period ofone* year from the date that these unaudited condensed financial statements are issued.

We will seek additional funding through equity financings or debt financings to support our current operating plan. Although management intends to pursue plans to obtain additional funding to finance its operations, and we have successfully raised capital in the past, we* may**not* be able to obtain financing on acceptable terms, or at all. The terms of any financing* may*adversely affect the holdings or rights of the Company’s stockholders.

We are actively pursuing the generation of positive cash flows from operating activities through an increase in revenue from its dental business worldwide, the generation of revenue from its medical devices and disposables business in the United States and worldwide, and a reduction in operating expenses. However, our continued operations will depend on its ability to raise additional capital through various potential sources until it achieves profitability, if ever.

9

NOTE3 —** SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

1. Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"), and the applicable rules and regulations of the Securities and Exchange Commission (SEC) include the accounts of Milestone Scientific and its wholly owned subsidiaries, including, Wand Dental (wholly owned), and Milestone Innovations Inc. (wholly owned). All significant intra-entity transactions and balances have been eliminated in the consolidation.

2. Basis of Presentation

The unaudited condensed consolidated financial statements of Milestone Scientific have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information with the instructions for Form10-Q and Article8 of Regulation S-X. Accordingly, they donot include all the information and footnotes required by GAAP for complete annual financial statements. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal recurring entries) necessary to fairly present such interim results. Interim results arenot necessarily indicative of the results of operations which* maybe expected for a full year or any subsequent period. These unaudited consolidated financial statements should be read in conjunction with the unaudited consolidated financial statements and notes thereto for the year ended December 31, 2024,included in Milestone Scientific's Annual Report on Form10*-K.

3. Use of Estimates

The preparation of unaudited condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions in determining the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the unaudited condensed consolidated financial statements have and reported amounts of revenues and expenses during the reporting period. The most significant estimates relate to the inventory valuation and cash flow assumptions regarding evaluations of going concern considerations. The Company bases its estimates on historical experience, known trends and other market-specific or relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts, and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates.

4. Revenue Recognition

The Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To achieve revenue recognition, the Company performs the followingfive steps:

The Company derives its revenues from the sale of its products, primarily dental and medical instruments, handpieces, and other related products. The Company sells its products directly to consumers in the United States and through a global distribution network that includes both exclusive and non-exclusive distribution agreements international.

Revenue is recognized at the point of shipment for all sales. The Company hasno obligation to product sales for any installation, set-up, or maintenance, these being the responsibility of the buyer. Milestone Scientific's only obligation after sale is the normal commercial warranty against manufacturing defects if the alleged defective unit is returned within the warranty period.

10

E-Commerce

The Company sells its STA Single Tooth Anesthesia Systems® (STA) and handpieces directly to dental offices and dental groups within the United States via an online portal. The Company's E-Commerce portal accepts online payments via credit and debit cards. The cost of delivery is charged to the customer along with appropriate sales tax. The Company recognizes revenue from product sales at the time the product ships to a customer via athird-party carrier.

Sales Returns

The Company records allowances for product returns as a reduction of revenue at the time product sales are recorded. Several factors are considered in determining whether an allowance for product returns is required, including the customers’ return rights and the Company’s historical experience with returns and the amount of product in the distribution channelnot consumed by end users and subject to return. The Company relies on historical return rates to estimate returns.

Financing and Payment

The Company's payment terms differ by geography and customer, but payments from distributors are required within90 days or less from the date of shipment. The E-Commerce portal sells directly to end users and accepts online payments via credit and debit cards via athird-party. These payments from thethird party are typically settled withintwo business days.

Disaggregation of Revenue

The Company operates intwo operating segments: Dental, and Medical. The Company evaluates each oftwo segments based on performance, using segment financial information compiled utilizing the accounting policies listed in Note10 of this Form10-Q.

The profitability of the segment helps the Company evaluate staffing levels, assess available cash for allocation to projects and resources, and make informed decisions on whether the segment's activities should be modified to align with the Company’s overall near- and long-term strategies. See Note10 for revenues by geographical market, based on the customer’s location, and product category for thethree andsix months ended* June 30, 2025,and2024* respectively.

5. Cash and Cash Equivalents

Milestone Scientific considers all highly liquid investments purchased with an original maturity ofthree months or less to be cash equivalents. As of* June 30, 2025and December 31, 2024,Milestone Scientific has approximately $1.3 million and $3.3 million, respectively of cash and cash equivalents. As of June 30, 2025,Milestone Scientific had cash in accounts that exceeded the Federal Deposit Insurance Corporation insurance limit of$250,000.*

**6. ** Accounts Receivable

The E-commerce portal sells directly to end users and accepts online payments via credit and debit cards via athird-party credit card processor. These payments are settled within2 business days of the transaction. Sales to distributors are on credit terms. The Company estimates losses from the ability or inability of its distributor to make payments on billed.

Distributors credit sales are due90 days or less from the date of invoicing. As of* June 30, 2025and December 31, 2024,accounts receivable was recorded, net of allowance for credit losses of$10,000,* respectively.

7. Inventories

Inventories principally consist of finished goods and component parts stated at the lower cost (first-in,first-out method) or net realizable value. Inventory quantities on hand are reviewed on a quarterly basis and a provision for excess slow moving, defective, and obsolete inventory is recorded if required based on past and expected future sales, potential technological obsolescence, and product expiration requirements.

The valuation allowance creates a new cost basis for the inventory, and it isnot subsequently marked up through a reduction in the valuation allowance based on any changes in the underlying facts and circumstances. When the valuation allowance is initially recorded, the increase to the allowance is recognized as an increase in cost of sales. The valuation allowance is only reduced if or when the underlying inventory is sold or destroyed, at which time the cost of sales recognized would include the previous adjusted cost basis.

11

8. Convertible Notes Payable, Related Parties

The Company accounts for Convertible Notes Payable, Related Parties in accordance with ASC470, Debt. Based on analysis performed by the Company,no embedded conversion or redemption features required bifurcation as derivatives in accordance with ASC815, Derivatives and Hedging.

9. Basic and Diluted Net Loss Per Common Share

Milestone Scientific presents “basic” earnings (loss) per common share applicable to common stockholders and, if applicable, “diluted” earnings (loss) per common share applicable to common stockholders pursuant to the provisions of ASC260, “Earnings per Share”. Basic earnings (loss) per common share is calculated by dividing net income or loss applicable to common stockholders by the weighted average number of common shares outstanding and to be issued common shares as follows:82,049,984 and 81,903,323 for thethree andsix months ended* June 30, 2025and 79,966,833 and 80,412,397 for thethree* andsix months ended* June 30, 2024respectively. The calculation of diluted earnings per common share is like that of basic earnings per common share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if all potentially dilutive common shares, such as those issuable upon the exercise of stock options, were issued during the period. Since Milestone Scientific had net losses in thesix* months ended* June 30, 2025and2024,* the assumed effects of the exercise of potentially dilutive outstanding stock options, unissued restricted stock awards (“RSA”), and convertible notes payable, related parties, werenot included in the calculation as their effect would have been anti-dilutive. Such outstanding options, convertible notes payable, and RSA's totaled 3,792,211 and 3,128,652 forsix months ended* June 30, 2025and2024,* respectively.

10. Recent Accounting Pronouncements

Recently Issued Accounting Pronouncement

In* November 2024,*** the Financial Accounting Standards Board, “FASB”, issued Accounting Standards Update “ASU”2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic220-40), to improve the disaggregation of expenses within the consolidated statement of operations. The amendments in ASU2024-03 require disclosures, in the notes to the consolidated financial statements, specified information about certain costs and expenses. The amendments require that at each interim and annual reporting period an entity disclose (a) employee compensation, (b) depreciation, and (c) intangible asset amortization included in each relevant expense caption; include certain amounts that are already required to be disclosed under current generally accepted accounting principles (GAAP) in the same disclosure as the other disaggregation requirements; and disclose a qualitative description of the amounts remaining in relevant expense captions that arenot separately disaggregated quantitatively. The amendments in ASU2024-03 are effective* January 1, 2027,and effective for interim periods beginning January 1, 2028.Early adoption is permitted for annual financial statements that havenot* yet been issued or made available for issuance. The Company will evaluate the impact of ASU2024-03 on its consolidated financial statements.

Recently Adopted Accounting Pronouncement

In* December 2023,FASB issued ASU2023*-09,** Income Taxes (Topic740): Improvements to Income Tax Disclosures, to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU2023-09 provide improvements primarily related to the rate reconciliation and income taxes paid information included in income tax disclosures. The Company would be required to disclose additional information regarding reconciling items equal to or greater thanfive percent of the amount computed by multiplying pretax income (loss) by the applicable statutory tax rate. Similarly, the Company would be required to disclose income taxes paid (net of refunds received) equal to or greater thanfive percent of total income taxes paid (net of refunds received). Additionally, the Company would be required to disclose income (loss) from continuing operations before income tax expense disaggregated by foreign and domestic jurisdictions, as well as income tax expense disaggregated by federal, state, and foreign jurisdictions. The amendments in ASU2023-09 are effective* January 1, 2025.Early adoption is permitted for annual financial statements that havenot* yet been issued or made available for issuance. The Company is evaluating the impact of the adoption of the ASU2023-09 on its consolidated financial statements.

12

In* November 2023,FASB issued ASU2023*-07, Segment Reporting (Topic280*), Improvements to Reportable Segment Disclosures*, which provides improvements to reportable segment disclosure requirements, primarily through enhanced disclosures around segment expenses. ASU2023-07 requires us to disclose significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss. ASU2023-07 also requires that the Company disclose an amount for other segment items by reportable segment, a description of their composition and provide all annual disclosures about a reportable segment’s profit or loss and assets pursuant to Topic280 during interim periods. The Company must also disclose the CODM’s title and position, as well as certain information around the measures used by the CODM and an explanation of how the CODM uses the reported measures in assessing segment performance and deciding how to allocate resources. For public entities with a single reportable segment, the entity must provide all the disclosures required pursuant to ASU2023-07 and all existing segment disclosures under Topic280. The amendments of ASU2023-07 are effective for us for annual periods beginning* January 1, 2024,and effective for interim periods beginning January 1, 2025.Early adoption is permitted for annual financial statements that havenot* yet been issued or made available for issuance. As of* January 1, 2024,the Company adopted ASU2023*-07 on within consolidated financial statements. See Note10 for more information.

NOTE4 —** INVENTORIES**

Inventories consist of the following:

The Company had an allowance on slow moving Medical finished goods due to the slow adoption of the epidural instruments and handpieces for approximately $1.1 million as of* June 30, 2025,and December 31, 2024,*respectively.

NOTE5 —** ADVANCES ON CONTRACTS**

The advances on contracts represent funding of future STA devices, epidural instruments, and epidural replacements parts. The balance of advances as of* June 30, 2025and December 31, 2024*is approximately $1.1 million and $1.3 million, respectively. The advance is classified as current based on the estimated annual usage of the underlying inventory.

NOTE6 —** CONVERITBLE NOTE PAYABLE, RELATED PARTY**

On* April 9, 2025,the Company issued a series of promissory notes (the "Notes") in the aggregate amount of $800,000, to Mr. Neal Goldman, Ms. Benedetta Casamento, and Dr. Didier Demesmin, each of whom is a director of the Company. The Notes are due April 9, 2028,*and bear interest at the annual rate ofprime less 2.50%, payable annually. All principal and interest shall be payable in cash and/or shares of common stock at the sole discretion of the Company.

13

The Notes are convertible into shares of common stock by the holder at any time and by the Company at maturity. If the Company sells equity securities for gross proceeds in excess of $4,000,000, the holders* mayrequest repayment of their note in either cash, shares of common stock or a combination of cash and shares; provided, that the holders would then be entitled to receive only so much cash as the net proceeds to the Company in such sale of equity securities, after payment of other indebtedness and other uses (other than working capital) specified as a use of the proceeds in the relevant offering or disclosure documentation, shall be in excess of $4,000,000. Upon a liquidation event of the Company, as defined in the Notes which includes a sale of the Company or assets, a merger, reorganization or combination transaction where the shareholders before the transaction own less than 50% of the Company after the transaction and a liquidation, dissolution or winding-up of the Company, the Notes will be repaid in cash or its portion of any non-cash consideration. The conversion rate for any issuance of shares of common stock will be at the then fair value of a share of common stock, with the fair value being determined with reference to the public market price of a share of common stock based on the average of the15* most recent trading days, butnot less than $0.50. The Notes are unsecured and have typical default terms. As of* June 30, 2025,*the Notes were convertible into 963,855 shares of common stock based on an average trading price of $0.83 per share.

NOTE7—** STOCKHOLDERS**’** EQUITY**

PUBLIC OFFERING

On* January 12, 2024*the underwriter exercised its over-allotment option as to 372,110 shares of common stock for net proceeds after discounts and commission of $192,156.

SHARES TO BE ISSUED

As of* June 30, 2025and2024,* there were 3,076,871 and 2,657,058, respectively, shares to be issued whose issuance has been deferred under the terms of employment and consulting agreements with officers and directors and other employees of Milestone Scientific. Such shares will be issued to each party upon termination of their employment or other relationship with the Company.

As of* June 30, 2025and2024,* there were 631,792 and 527,625, respectively, shares to be issued to non-employees, that will be issued to non-employees for services rendered. The number of shares was fixed by contract prior to the date of grant, subject to performance, and were fully earned upon the grant date.

The following table summarizes information about shares to be issued for thesix month periods ending* June 30, 2025and2024.*

NOTE8 —** STOCK OPTION PLANS**

Milestone Scientific Inc., the Amended and Restated2020 Equity Incentive Plan, provides for awards of restricted common, stock restricted stock units, options to purchase and other awards. On* June**28,* 2023 the plan was amended and restated (the*"2020* Plan") to increase the maximum shares that can be issued thereunder to 11,500,000 shares of common stock. The plan expires in* June 2031.Options maybe granted to employees, directors, and consultants of Milestone Scientific for the purchase of shares of common stock at a pricenot* less than the fair market value of common stock on the date of grant. Generally, options become exercisable over athree-year period from the grant date and expire five years after the date of grant.

Milestone Scientific recognizes compensation expenses over the requisite service period and in the case of performance-based options over the period of the expected performance. For thethree andsix months ended* June 30, 2025,Milestone Scientific recognized approximately $158,000 and$329,000 of total employee compensation cost, respectively, recorded in general and administrative expenses on the statement of operations. For thethree* andsix months ended* June 30, 2024,*Milestone Scientific recognized approximately $170,000 and$358,000 of total employee compensation cost, respectively, recorded in general and administrative expenses on the statement of operations.

As of* June 30, 2025,*there was $528,000 of total unrecognized compensation cost related to non-vested options. Milestone Scientific expects to recognize these costs over a weighted average period of 0.75 years.

14

There wereno options granted to employees during thesix months ended* June 30, 2025*are presented below:

A summary of option activity for non-employees under the plans and changes during thesix months ended* June 30, 2025*is presented below:

The fair value of the non-employee options was estimated on the date of grant using the Black Scholes option-pricing model at the date of grant. For thethree andsix months ended* June 30, 2025,Milestone Scientific recognized approximately$1,400* and $8,000 expenses related to non-employee options, respectively. For thethree andsix months ended* June 30, 2024,Milestone Scientific recognized approximately $1,100 and$2,200,* respectively of expense related to non-employee options.

A summary of restricted stock under the plans and changes during thesix months ended* June 30, 2025*is presented below:

The Company granted 730,340 restricted stock awards with a fair market value of$0.89 per share. Such restricted stock vests asfollows:25% on the grant date in* June 2024,and 25% quarterly, on the first day of the following months: October**2024, January* 2025, and April 2025. These awards vest immediately upon a change of control as defined in the agreements. For thethree andsix months endedJune 30, 2025, the Company recognized approximately $1,500 and $155,500, respectively, for restricted stock expenses recorded in general and administrative expenses on the statement of operation. As of* June 30,*2025 there wasno unrecognized compensation expense.

NOTE9 —** INCOME TAXES**

The utilization of Milestone Scientific's net operating losses* maybe subject to a substantial limitation due to the "change of ownership provisions" under Section382* of the Internal Revenue Code and similar state provisions. Such limitations* may*result in the expiration of the net operating loss carry forwards before their utilization. Milestone Scientific has established a 100% valuation allowance for all its deferred tax assets due to uncertainty as to their future realization.

15

In* April 2024,we received approximately $2.0 million, net of expenses, from the sale of New Jersey net operating losses (“NOL”), that were eligible for sale under the State of New Jersey’s Economic Development Authority’s New Jersey Technology Business Tax Certificate Transfer Program (” NJEDA Program”). For thethree* andsix month ended* June 30, 2024*the Company recorded approximately $2.0 million in gain on sale of net operating losses within the unaudited condensed consolidated statement of operations.

Pursuant to the NJEDA program, the Company must retain a physical presence in the state of New Jersey for a period of5 years after the sale of the NOLs. If the Company doesnot retain a physical presence during the5 years after the sale of the NOLs, the Company can be liable to pay the state of New Jersey up to $2.2 million of the surrendered NOLs

NOTE 10—** SEGMENT AND GEOGRAPHIC DATA**

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Chief Executive Officer (the “CODM”). The Company conducts its business throughtwo reportable segments: Dental and Medical. These segments offer different products and services to different customer base. The CODM assesses the financial performance of the segment and decides how to allocate resources based on Product sales, net, and Operating income (loss).

The Company provides general corporate services to its segments; however, these services arenot considered when making operating decisions and assessing segment performance. These services are reported under “Corporate Services” below and these include costs associated with executive management, investor relations, patents, trademarks, licensing agreements, new instruments developments, financing activities and public company compliance.

The following tables present information about our reportable and operating segments for thethree andsix months ended* June 30, 2025,and2024:*

16

17

NOTE11–** CONCENTRATIONS**

Milestone Scientific has informal arrangements withthird-party U.S. manufacturers of the STA devices, and epidural instruments pursuant to which they manufacture these products under specific purchase orders which contains advance payments for long lead items for production. Advances on contracts have been classified as current at* June 30, 2025and December 31, 2024.*The termination of the manufacturing relationship with any of these manufacturers could have a material adverse effect on Milestone Scientific’s ability to produce and sell its products. Although alternate sources of supply exist, and new manufacturing relationships could be established, Milestone Scientific would need to recover its existing tools or have new tools produced. Establishing new manufacturing relationships could involve significant expense and delay. Any curtailment or interruption of the supply, because of termination of such a relationship, would have a material adverse effect on Milestone Scientific’s financial condition, business, and results of operations.

On* January 3, 2023,the Company launched an E-Commerce platform selling and shipping STA Single Tooth Anesthesia System® (STA) and handpieces directly to dental offices and dental groups within the U.S. For thethree* months ended* June 30, 2025,and June 30, 2024,E-Commerce accounted for 53% and 66% of net product sales, respectively. For thethree* months ended* June 30, 2025,one international distributor accounted for 10% of net product sales. For thesix* months ended* June 30, 2025,and June 30, 2024,*E-Commerce accounted for 50% and 59% of net product sales, respectively.

The Company hadthree distributors that accounted for 32%,16%,13% of accounts receivable, respectively, forsix months ended* June 30, 2025.The Company hadthree distributors that accounted for 22%,13% and 11% of accounts receivable, respectively as of December 31, 2024.*

As of* June 30, 2025,the Company hadfour suppliers that accounted for 25%,24%,12% and 11%, respectively, of accounts payable and accounts payable, related party. The Company hadtwo suppliers that accounted for 31% and 30%, respectively of accounts payable and accounts payable, related party as of December 31, 2024.*

18

NOTE12 -- RELATED PARTY TRANSACTIONS

United Systems

Milestone Scientific has a supply agreement with United Systems, the principal supplier of its handpieces, pursuant to which it procures manufactured products under specific purchase orders, but without minimum purchase commitments. Purchases from this supplier were approximately $285,000 and $772,000 for thethree andsix months ended* June 30, 2025.Purchases from this supplier were approximately $423,000 and $1.2 million for thethree* andsix months ended* June 30, 2024.*

As of* June**30,2025,* and* December 31, 2024,*Milestone Scientific owed this supplier approximately $539,000 and $663,000, respectively, which is included in accounts payable and accrued expenses related party on the unaudited condensed consolidated balance sheets.

Director of Clinical Affairs

The Director of Clinical Affairs’ royalty fee was approximately $119,000 and $232,000 for thethree andsix months ended* June 30, 2025,respectively. The Director of Clinical Affairs’ royalty fee was approximately $95,000 and $211,000 for thethree* andsix months ended* June 30, 2024,respectively. Additionally, Milestone Scientific expensed consulting fees to the Director of Clinical Affairs of $39,000, and $78,000 for thethree* andsix months ended* June 30, 2025and2024,* respectively. As of* June 30, 2025and December 31, 2024,*Milestone Scientific owed the Director Clinical Affairs for royalties of approximately $125,000 and $110,000, respectively, which is included in accounts payable, related party and accrued expense, related party, in the unaudited condensed consolidated balance sheets.

Directors

Leonard Osser

On* March 2, 2021,the Company entered into a Royalty Sharing Agreement with Leonard Osser, pursuant to which Mr. Osser sold, transferred and assigned to the Company all of his rights in and to a certain patent application as to which he is a co-inventor with Mark Hochman, a consultant to the Company, and the Company agreed to pay to Mr. Osser, beginning May 9, 2027,half of the royalty (2.5%) on net sales that would otherwise be payable to Mark and Claudia Hochman under their existing Technology Sale Agreement, dated January 1, 2005and amended from time to time, with the Company. In connection with the Royalty Sharing Agreement, the Hochman's agreed with the Company, pursuant to an addendum to such Technology Sale Agreement dated February 25, 2021,to reduce from 5% to 2.5% the payments due to them under their Technology Sale Agreement beginning on May 9, 2027,*and thereafter with respect to dental products embodying the invention.

As part of the Succession Plan of the Company, Mr. Osser agreed, pursuant to an agreement dated* April 6, 2021 (*the “Succession Agreement”), to restructure certain of his existing agreements with the Company, which provide for additional and broader executive support, and at such time as he elects to step down as Interim Chief Executive Officer of the Company, to become the Vice Chairman of the Board of the Company.

With respect to Mr. Osser’s* July 2017Employment Agreement and July 2017Consulting Agreement (each as previously disclosed), the compensation under the Employment Agreement was modified to reduce the overall compensation by $100,000 to $200,000, split equally between a cash amount and an amount in shares, and the compensation under the Consulting Agreement was increased by $100,000 to $200,000, equally split between a cash amount and an amount in shares, which shares were formerly payable under the Employment Agreement. If the Company terminates Mr. Osser’s employment “Without Cause,” other than due to his death or disability, or if Mr. Osser terminates his employment for “Good Reason” (both as defined in the agreement), Mr. Osser is entitled to be paid inone* lump sum payment as soon as practicable following such termination: an amount equal to the aggregate present value (as determined in accordance with Section280G(d)(4) of the Code) of all compensation pursuant to this agreement from the effective date of termination hereunder through the remainder of the Employment Term.

In connection with his acceptance of the Vice Chairman position and in consideration of his services as a member of the Board and agreement to provide certain additional general consulting services, Mr. Osser was granted options to purchase 2,000,000 shares of common stock, exercisable at the fair market value of the common stock on the date of grant, vesting over thefive-year period after he steps down as Interim Chief Executive Officer of the Company orten years from the date of grant, whichever shall end first. The Company believes that the effect of such existing agreements and the Succession Agreement, all of which relate to the period after such time Mr. Osser steps down as Interim Chief Executive Officer of the Company, collectively expand Mr. Osser’s consulting to and support of the Company beyond its Chinese operations to also include its medical and other products, while enhancing the retention aspects of the Company’s relationship with Mr. Osser. On* May 19, 2021,*Mr. Osser resigned as Interim Chief Executive Officer of the Company and assumed the role of Vice Chairman of the Board.

19

Compensation under the Employment Agreement and the Consulting Agreement is payable for9.5 years from* May 19, 2021.The Company recorded expenses of $50,000 and $100,000 related to the Employment Agreement for thethree* andsix months ended* June 30, 2025and2024* respectively. The Company recorded expenses of$50,000 and $100,000 related to the Consulting Agreement for thethree andsix months ended* June 30, 2025and2024* respectively. Mr. Osser also owns 2,717,765 of the Company's stock, and 2,481,048 shares to be issued at the termination of his employment agreement.

Dr. D. Demesmin, Director

As of* February 2024,the University Pain Medicine Center (STEMMEE), of which Dr. D. Demesmin, a Company board member is the CEO agreed to purchases products from the Company under the same terms and conditions applying to other medical pain clinics in the United States. STEMMEE purchased medical products in the amount of $15,000 and $21,000 for thethree* andsix months ended* June 30, 2025.STEMMEE purchased medical products in the amount of $6,000 and $9,000 for thethree* andsix months ended* June 30, 2024.*

Arjan J. Haverhals, Director

The Company entered into a consulting agreement with Mr. Arjan Haverhals, which commenced on* January 1, 2025,and continues for an indefinite period, subject to the Company having the right to terminate the Consulting Agreement on30* days advance notice in the event of his disability to provide services and either party having the right to terminate the Consulting Agreement on90 days’ advance notice. Mr. Haverhals will be paid an annual fee at the rate of $350,000, at the at the rate of $150,000 in respect of thefirst calendar quarter of2025, and at the rate of$67,000 in respect of each subsequent calendar quarter of2025, payable monthly in arrears, in each case in equal monthly installments on the last day of each month of such quarter.

The Company will reimburse Mr. Haverhals for reasonable expenses in providing the services. Mr. Haverhals will be an independent contractor and willnot be provided with health and accident insurance, life insurance, paid sick leave and/or paid vacation time. In connection with the Consulting Agreement, he has also entered into a Company-standard form of non-disclosure, non-solicitation, non-competition, and invention agreement. Mr. Haverhals continues as a director of the Company and as a director of Milestone Scientific. Company recorded expenses of $67,000 and $216,000 related to the consulting agreement for thethree andsix months ended* June 30, 2025*respectively.

Mr. Haverhals will be issued 912,736 shares of the Company's stocksix months after his resignation as CEO and in accordance with such consulting agreement. As of* June 30, 2025the share havenot* been issued to Mr. Haverhals.

NOTE13 —** COMMITMENTS**

(1) Contract Manufacturing Agreement

Milestone Scientific has informal arrangements withthird-party manufacturers of the STA devices, and epidural instruments pursuant to which they manufacture these products under specific purchase orders but without any long-term contract or minimum purchase commitment. The Company has a purchase commitment for the delivery of 2,000 STA instruments as of* June 30, 2025.As of June 30, 2025,the purchase order commitment was approximately $2.5 million, and approximately $786,000 was paid and reported in advance on contracts in the unaudited consolidated balance sheet. As of June 30, 2025the Company recorded approximately $293,000 for the development of the next generation instrument in advances on contracts in the unaudited consolidated balance sheet. As of December 31, 2024,*the purchase order commitment was approximately $3.2 million, and approximately $932,000 was paid and reported in advance on contracts in the consolidated balance sheet.

The advances on contracts represent funding of future epidural instruments, and epidural replacements parts. As of* June 30, 2025and December 31, 2024*the company also has advances on an open purchase order for long lead items for a future purchase order for the manufacturing of Epidural instrument of approximately $34,000 and $168,000 respectively.

(2) Operating Leases

The Company identified and assessed the following significant assumptions in recognizing its right-of-use assets and corresponding lease liabilities:

20

The components of lease expense were as follows:

NOTE14—** SUBSEQUENT EVENTS**

Effective* July 31, 2025,the Board of Directors of Milestone Scientific Inc. (the “Company”) appointed Eric Hines as President and Chief Executive Officer, and as a director of the Company. From July 31, 2025through December 31, 2025 (the “Initial Term”), Mr. Hines will be entitled to base compensation at the rate of$15,000* per month. From* January 1, 2026,subject to Mr. Hines’s continued employment at the Company by mutual agreement (the “Extended Term”), Mr. Hines will be entitled to base compensation at the rate of $25,000 per month. In addition to his base compensation, Mr. Hines will be granted options (the “Signing Bonus Options”) for an aggregate of 2,000,000 shares of Common Stock of the Company. The exercise price of the Signing Bonus Options will be the fair market value of shares of Common Stock of the Company on the date of grant. Ten percent (10%) of the Signing Bonus Options will vest on the date of grant and the remainingninety* percent (90%) will

vest inthree (3) equal annual installments of 600,000 shares each. In addition, it is expected that Mr. Hines would be entitled to receive an annual incentive bonus, comprised of (i) separate performance-based bonuses; and (ii) a discretionary bonus, each as determined by the Company’s Compensation Committee, in its sole discretion.

21