VERU INC.

Previous wording

We are a late clinical stage biopharmaceutical company focused on developing novel medicines for the treatment of cardiometabolic and inflammatory diseases. Our drug development program consists of two late-stage new chemical entities, enobosarm and sabizabulin. Enobosarm, an oral selective androgen receptor modulator (“SARM”), is being developed as a next generation drug that makes weight reduction by GLP-1 RA drugs more tissue selective for loss of fat and preservation of lean mass leading to improved body composition and physical function which is expected to result in clinically meaningful incremental weight reduction versus GLP-1 RA therapy alone. Sabizabulin, a microtubule disruptor, is being developed for the treatment of chronic inflammation related to atherosclerotic cardiovascular disease. On December 30, 2024, the Company sold its FDA-approved commercial product, the FC2 Female Condom® (Internal Condom), for the dual protection against unplanned pregnancy and sexually transmitted infections (the “FC2 Business”).

Current wording

We are a late clinical stage biopharmaceutical company focused on developing innovative medicines for the treatment of cardiometabolic and inflammatory diseases. Our drug development program consists of two late-stage novel small molecules, enobosarm and sabizabulin. Enobosarm, an oral selective androgen receptor modulator (“SARM”), is being developed as a next generation drug that makes weight reduction by GLP-1 RA drugs more tissue selective for loss of fat and preservation of lean mass leading to improved body composition and physical function which is expected to result in clinically meaningful incremental weight reduction versus GLP-1 RA therapy alone. Sabizabulin, a microtubule disruptor, is being developed for the treatment of chronic inflammation related to atherosclerotic cardiovascular disease. On December 30, 2024, the Company sold its FDA-approved commercial product, the FC2 Female Condom® (Internal Condom), for the dual protection against unplanned pregnancy and sexually transmitted infections (the “FC2 Business”).

Previous wording

Currently approved GLP-1 RA treatment in patients with obesity exhibits significant weight loss composed of reductions in both fat and lean (muscle) mass. In the scientific literature, 20-50% of the total weight loss was attributable to lean mass (muscle) loss. Older patients who have sarcopenic obesity have both obesity and low muscle mass and are potentially at the greatest risk for developing critically low muscle mass when taking a currently approved GLP-1 RA. We therefore believe there is an urgent unmet need for a drug that prevents the loss of muscle and increases the loss of fat for greater weight loss in at-risk sarcopenic obese and overweight older patients receiving GLP-1 RA for weight reduction.

Current wording

Currently approved GLP-1 RA treatments in patients with obesity results in significant weight loss composed of reductions in both fat and lean (muscle) mass. In the scientific literature, 20-50% of the total weight loss was attributable to lean mass (muscle) loss. Older patients who have sarcopenic obesity have both obesity and low muscle mass and are potentially at the greatest risk for developing critically low muscle mass and physical function decline when taking a currently approved GLP-1 RA. According to the European Working Group on Sarcopenia in Older People 2 (EWGSOP2), sarcopenia is defined by reduced muscle strength/function as the primary diagnostic criterion, confirmed by low muscle quantity or quality, while impaired physical performance reflects disease severity. We believe there is an urgent unmet need for a drug that prevents the loss of muscle and physical function as well as increases the loss of fat for greater weight loss in at-risk sarcopenic obese older patients receiving GLP-1 RA for weight reduction.

Previous wording

Enobosarm is being developed as a treatment to preserve muscle and physical function as well as to reduce fat resulting in incremental weight loss in patients with obesity receiving a GLP-1 RA for weight reduction. A Phase 2b, multicenter, double-blind, placebo-controlled, randomized, dose-finding QUALITY clinical trial was conducted to evaluate the safety and efficacy of enobosarm 3mg, enobosarm 6mg, or placebo in 168 patients with obesity (≥60 years of age) receiving semaglutide (Wegovy®) for weight reduction. The primary endpoint was the percent change from baseline in total lean body mass, and the key secondary endpoints were the percent change from baseline in total body fat mass, total body weight, and physical function as measured by stair climb test at 16 weeks. After completing the efficacy dose-assessment portion of the Phase 2b QUALITY clinical trial, the participants continued into a Phase 2b maintenance extension trial where all patients stopped treatment with semaglutide, but continue taking placebo, enobosarm 3mg, or enobosarm 6mg monotherapy in a blinded fashion for 12 additional weeks. The Phase 2b extension clinical trial evaluated whether enobosarm can maintain muscle and prevent the fat and weight regain that generally occurs after discontinuing a GLP-1 RA.

Current wording

Enobosarm is being developed for weight loss and as a treatment to preserve physical function as well as to augment fat loss resulting in incremental weight loss in patients with obesity receiving a GLP-1 RA for weight reduction. A Phase 2b, multicenter, double-blind, placebo-controlled, randomized, dose-finding QUALITY clinical trial was conducted to evaluate the safety and efficacy of enobosarm 3mg, enobosarm 6mg, or placebo in 168 patients with obesity (≥60 years of age) receiving semaglutide (Wegovy®) for weight reduction. The primary endpoint for the QUALITY clinical trial was the percent change from baseline in total lean body mass, and the key secondary endpoints were the percent change from baseline in total body fat mass, total body weight, and physical function as measured by stair climb test at 16 weeks. After completing the efficacy dose-assessment portion of the Phase 2b QUALITY clinical trial, the participants continued into a Phase 2b maintenance extension trial where all patients stopped treatment with semaglutide, but continue taking placebo, enobosarm 3mg, or enobosarm 6mg monotherapy in a blinded fashion for 12 additional weeks. The Phase 2b extension clinical trial evaluated whether enobosarm can maintain muscle and prevent the fat and weight regain that generally occurs after discontinuing a GLP-1 RA.

Previous wording

The regulatory landscape continues to evolve for muscle preservation drugs in the treatment of obesity. Based on FDA feedback on Veru’s clinical development program for enobosarm received in September 2025, the FDA now guides that incremental weight loss with enobosarm added to GLP-1 RA treatment over the GLP-1 RA treatment alone is an acceptable primary endpoint to support approval.

Current wording

The regulatory landscape continues to evolve for muscle preservation drugs in the treatment of obesity. Based on FDA feedback on Veru’s clinical development program for enobosarm received in September 2025, the FDA now guides that incremental weight loss with enobosarm added to GLP-1 RA treatment over the GLP-1 RA treatment alone is an acceptable primary endpoint to support the efficacy of enobosarm for approval.

Previous wording

On December 19, 2025, the FDA announced that total hip bone mineral density (BMD) assessed by DXA qualifies as a validated surrogate endpoint for drug development in postmenopausal women with osteoporosis at risk for fracture providing an alternative to fracture endpoints. It has been reported in the scientific literature that GLP-1 RA therapy reduces hip BMD, and recently, the Wegovy FDA label has been updated to include the safety concern of increased risk of hip and pelvic fractures based on the SELECT cardiovascular trial in adults. The SELECT (Semaglutide Effects on Heart Disease and Stroke in Patients With Overweight or Obesity) cardiovascular trial is a completed clinical trial sponsored by Novo Nordisk A/S in over 17,000 subjects. In the SELECT trial, 4-5 times more fractures of the hip and pelvis were reported on Wegovy than on placebo in female patients and patients ages 75 and older. Enobosarm has been shown in published preclinical studies to have anabolic and antiresorptive activity to increase bone mineral density in rat models of postmenopausal women and male osteoporosis.

Current wording

On December 19, 2025, the FDA announced that total hip bone mineral density (BMD) assessed by DXA qualifies as a validated surrogate endpoint for drug development in postmenopausal women with osteoporosis at risk for fracture providing an alternative to fracture endpoints. It has been reported in the scientific literature that GLP-1 RA therapy reduces hip BMD, and recently, the Wegovy FDA label has been updated to include the observation of a greater number of hip and pelvic fractures in the SELECT cardiovascular trial in adults receiving semaglutide. The SELECT (Semaglutide Effects on Heart Disease and Stroke in Patients With Overweight or Obesity) cardiovascular trial is a completed clinical trial sponsored by Novo Nordisk A/S in over 17,000 subjects. In the SELECT trial, 4-5 times more fractures of the hip and pelvis were reported on Wegovy than on placebo in female patients and patients ages 75 and older. Enobosarm has been shown in published preclinical studies to have anabolic and antiresorptive activities to increase bone mineral density in rat models of postmenopausal women and male osteoporosis.

Previous wording

The evolving FDA thinking for the development of muscle preservation drugs for obesity and the critical changes in the current FDA guidance related to the acceptable primary endpoint of incremental weight loss, have necessitated the change in Veru’s clinical development plan. The clinical development program of enobosarm will take advantage of both the FDA regulatory clarity on the acceptable primary endpoint and on enobosarm’s key attributes, preservation of muscle and physical function, and greater selective fat loss (100% fat loss and 0% lean mass weight loss), that were demonstrated in Veru’s Phase 2 QUALITY study. Further, enobosarm’s ability to improve body composition by preserving muscle, losing more fat, and increasing bone mineral density measured by DXA may also take advantage of hip BMD as a validated surrogate primary endpoint.

Current wording

The clinical development program of enobosarm will take advantage of both the FDA regulatory clarity on the acceptable primary endpoint and on enobosarm’s key attributes, preservation of muscle and physical function, and greater selective fat loss (100% fat loss and 0% lean mass weight loss), that were demonstrated in Veru’s Phase 2 QUALITY study. Further, enobosarm’s ability to improve body composition by preserving muscle, losing more fat, and increasing bone mineral density measured by DXA may also take advantage of hip BMD as a validated surrogate primary endpoint.

Previous wording

The Company plans to focus its Phase 2b clinical study in older patients (age ≥ 65 yo) who have the most weight to lose (BMI ≥ 35). The weight loss plateau occurs when the patient with obesity stops losing weight while on a GLP-1 RA. In the SURMOUNT-1 clinical study conducted by Eli Lilly and Company, about 88% of patients with obesity receiving tirzepatide reached the weight loss plateau by 72 weeks. Unfortunately, 62.6% of these patients are still clinically overweight or have obesity at 72 weeks, and almost all of the patients that had a baseline BMI ≥ 35 still had obesity. We believe treatment with semaglutide when combined with enobosarm, will lead to additional fat loss by preserving muscle and physical function. Enobosarm’s ability to directly and indirectly cause additional fat loss is expected to reset the weight loss plateau leading to incremental weight reduction, thereby increasing the number of patients who achieve and maintain a normal weight.

Current wording

The Company is focusing its Phase 2b PLATEAU clinical study in older patients (age ≥ 65 yo) who have the most weight to lose (BMI ≥ 35). The weight loss plateau occurs when the patient with obesity stops losing weight while on a GLP-1 RA. In the SURMOUNT-1 clinical study conducted by Eli Lilly and Company, about 88% of patients with obesity receiving tirzepatide reached the weight loss plateau by 72 weeks. Unfortunately, 62.6% of these patients are still clinically overweight or have obesity at 72 weeks, and patients that had a baseline BMI ≥ 35 on average still had obesity. We believe treatment with semaglutide when combined with enobosarm, will lead to additional fat loss by preserving muscle and physical function and directly burning fat. Enobosarm’s ability to directly and indirectly cause additional fat loss is expected to reset the weight loss plateau leading to incremental weight reduction, thereby increasing the number of patients who achieve and maintain a normal weight.

Previous wording

Veru’s planned Phase 2b PLATEAU clinical trial design is a double-blind, placebo-controlled study to evaluate the effect of enobosarm 3mg on total body weight, fat mass, lean mass and physical function, bone mineral density and safety in approximately 200 older patients (age ≥ 65 yo) who have obesity (BMI ≥ 35) and are initiating semaglutide (Wegovy) GLP-1 RA treatment for weight reduction. The primary efficacy endpoint of the study is the percent change from baseline in total body weight at 68 weeks. An interim analysis will be conducted at 34 weeks to assess the percent change from baseline in lean body mass and fat mass, as measured by DXA scan. The key secondary endpoints are total fat mass, total lean mass, physical function (stair climb test), bone mineral density, and patient reported outcome questionnaires for physical function (SF-36 PF-10, and IWQOL-lite CT physical function), HbA1c, and insulin resistance.

Current wording

On March 9, 2026, the Company announced it had enrolled its first patient in the Phase 2b PLATEAU clinical trial. Veru’s PLATEAU clinical trial design is a double-blind, placebo-controlled study to evaluate the effect of enobosarm 3mg on total body weight, fat mass, lean mass and physical function, bone mineral density and safety in approximately 200 older patients (age ≥ 65 yo) who have obesity (BMI ≥ 35) and are initiating semaglutide (Wegovy) GLP-1 RA treatment for weight reduction. The primary efficacy endpoint of the study is the percent change from baseline in total body weight at 68 weeks. An interim analysis will be conducted at 36 weeks to assess the percent change from baseline in lean body mass, total fat mass, percentage body fat mass, percentage body lean mass, and total body mass, as measured by DXA scan. The key secondary endpoints for the overall study are total fat mass, total lean mass, physical function (stair climb test), mobility-disability assessment, bone mineral density, and patient reported outcome questionnaires for physical function (SF-36 PF-10, and IWQOL-lite CT physical function), HbA1c, and insulin resistance.

Previous wording

The Phase 2b PLATEAU clinical study is designed to assess the ability of enobosarm treatment to break through the weight loss plateau observed in patients with obesity receiving GLP-1 RA treatment to achieve clinically meaningful incremental weight reduction and preserve muscle mass and physical function by 68 weeks. The clinical study is expected to begin in the first quarter of calendar 2026 and interim analysis is planned for first quarter of calendar 2027.

Current wording

The Phase 2b PLATEAU clinical study is designed to assess the ability of enobosarm treatment to break through the weight loss plateau observed in patients with obesity receiving GLP-1 RA treatment to achieve clinically meaningful incremental weight reduction and preserve muscle mass and physical function by 68 weeks. An interim analysis for the clinical study after all patients are treated for 36 weeks is planned for the first quarter of calendar 2027.

Previous wording

Based on FDA regulatory feedback and qualification of BMD as a surrogate endpoint, results from the Phase 2b PLATEAU study may have three possible regulatory pathways for approval for enobosarm in combination with the GLP- 1 RA. If incremental weight loss is ≥ 5%, the Phase 3 study could be in patients with obesity with a primary endpoint of total body weight, and key secondary endpoints for prespecified subgroups of physical function in sarcopenic patients (age ≥ 65 yo) with mobility disability and another for BMD in postmenopausal women with osteoporosis. If the incremental weight loss is < 5%, the Phase 3 study could be in patients with obesity and mobility disability with a primary endpoint of physical function in sarcopenic obesity patients (age ≥ 65 yo) with mobility disability, and a key secondary endpoint could be BMD in a prespecified group of postmenopausal women with osteoporosis. Alternatively, the Phase 3 study could be in patients with obesity and osteoporosis with a primary endpoint of BMD in postmenopausal women with osteoporosis, and a key secondary endpoint of physical function in sarcopenic patients (age ≥ 65 yo) with mobility disability.

Current wording

Based on FDA regulatory feedback and qualification of BMD as an acceptable surrogate endpoint, results from the Phase 2b PLATEAU study may have three possible regulatory pathways to support efficacy for approval of enobosarm in combination with the GLP- 1 RA. If incremental weight loss is ≥ 5%, the Phase 3 study could be in patients with obesity with a primary endpoint of total body weight, and key secondary endpoints for prespecified subgroups of physical function in sarcopenic patients (age ≥ 65 yo) with mobility disability and another for BMD in postmenopausal women with osteoporosis. If the incremental weight loss is < 5%, the Phase 3 study could be in patients with obesity and mobility disability with a primary endpoint of physical function in sarcopenic obesity patients (age ≥ 65 yo) with mobility disability, and a key secondary endpoint could be BMD in a prespecified group of postmenopausal women with osteoporosis. Alternatively, the Phase 3 study could be in patients with obesity and osteoporosis with a primary endpoint of BMD in postmenopausal women with osteoporosis, and a key secondary endpoint of physical function in sarcopenic patients (age ≥ 65 yo) with mobility disability.

Previous wording

We believe there is compelling scientific evidence and rationale to evaluate sabizabulin as a treatment for the inflammation associated with atherosclerotic cardiovascular disease. Sabizabulin is a new molecular entity, small molecule that targets the colchicine binding site on β-tubulin. Like colchicine, sabizabulin inhibits microtubule polymerization and has demonstrated the ability to reduce the most important inflammatory mediators that play a role in the initiation and progression of atherosclerotic CAD. Overall preclinical data fromin vitro andin vivo inflammation studies show that sabizabulin treatment suppressed all cytokines and chemokines tested which includes IL-1α, IL-1β, IL-6, IL-8, TNF-α, Interferon-γ, and IP-10 (CXCL-10). In Phase 2 and 3 pulmonary inflammation COVID-19 clinical studies, sabizabulin has demonstrated broad anti-inflammatory activity resulting in a significant reduction in mortality. The safety database consists of 266 dosed patients from the sabizabulin clinical development program comprised of the Phase 2 and Phase 3 studies in hospitalized COVID-19 patients for acute use (149 patients at 9 mg daily for ≤ 21 days), as well as data from the Phase 1b/2 and Phase 3 studies in prostate cancer for chronic use (117 patients treated at up to 32 mg daily for up to 3 years). Further, because sabizabulin has a different chemical structure than colchicine, it is not a substrate for CYP3A4 and P-glycoprotein thereby potentially eliminating drug-drug interactions concerns associated with colchicine. In contrast to colchicine, sabizabulin has stable pharmacokinetics and low potential for drug-drug interactions; thus, sabizabulin may be administered potentially more safely as a secondary therapy in combination with statin therapy for the reduction of inflammation to slow the progression or promote regression of atherosclerotic cardiovascular disease.

Current wording

We believe there is compelling scientific evidence and rationale to evaluate sabizabulin as a treatment for the inflammation associated with atherosclerotic cardiovascular disease. Sabizabulin is a novel small molecule that targets the colchicine binding site on β-tubulin. Like colchicine, sabizabulin inhibits microtubule polymerization and has demonstrated the ability to reduce the most important inflammatory mediators that play a role in the initiation and progression of atherosclerotic CAD. Overall preclinical data fromin vitroandin vivoinflammation studies show that sabizabulin treatment suppressed all cytokines and chemokines tested which includes IL-1α, IL-1β, IL-6, IL-8, TNF-α, Interferon-γ, and IP-10 (CXCL-10). In Phase 2 and 3 pulmonary inflammation COVID-19 clinical studies, sabizabulin has demonstrated broad anti-inflammatory activity resulting in a significant reduction in mortality. The safety database consists of 266 dosed patients from the sabizabulin clinical development program comprised of the Phase 2 and Phase 3 studies in hospitalized COVID-19 patients for acute use (149 patients at 9 mg daily for ≤ 21 days), as well as data from the Phase 1b/2 and Phase 3 studies in prostate cancer for chronic use (117 patients treated at up to 32 mg daily for up to 3 years). Further, because sabizabulin has a different chemical structure than colchicine, it is not a substrate for CYP3A4 and P-glycoprotein thereby potentially eliminating drug-drug interactions concerns associated with colchicine. In contrast to colchicine, sabizabulin has stable pharmacokinetics and low potential for drug-drug interactions; thus, sabizabulin may be administered potentially more safely as a secondary therapy in combination with statin therapy for the reduction of inflammation to slow the progression or promote regression of atherosclerotic cardiovascular disease.

Previous wording

The FC2 Business Sale represented a strategic shift, which had a major effect on our operations and financial results. We have classified all direct revenues, costs and expenses related to the FC2 business within loss from discontinued operations, net of tax, in the condensed consolidated statements of operations for the three months ended December 31, 2024. We did not allocate any amounts for shared general and administrative operating support expense to discontinued operations. The assets and liabilities sold as part of the FC2 Business Sale were written off upon the closing of the FC2 Business Sale, and therefore there are no assets and liabilities of discontinued operations in our condensed consolidated balance sheet as of December 31, 2025 or September 30, 2025.

Current wording

The FC2 Business Sale represented a strategic shift, which had a major effect on our operations and financial results. We have classified all direct revenues, costs and expenses related to the FC2 business within loss from discontinued operations, net of tax, in the condensed consolidated statements of operations for the three and six months ended March 31, 2025. We did not allocate any amounts for shared general and administrative operating support expense to discontinued operations. The assets and liabilities sold as part of the FC2 Business Sale were written off upon the closing of the FC2 Business Sale, and therefore there are no assets and liabilities of discontinued operations in our condensed consolidated balance sheet as of March 31, 2026 or September 30, 2025.

Previous wording

As of September 22, 2025, an aggregate of $8.8 million was payable to the Company under the ONCO Promissory Notes and related amendments. On September 22, 2025, the Company and ONCO entered into a Settlement Agreement and Release (the “Settlement Agreement”), whereby the Company agreed to accept a cash payment of $6.3 million, 3,125 shares of ONCO’s Series D Convertible Preferred Stock (the “ONCO Series D Preferred Stock”) and a warrant to purchase 846,975 shares of ONCO’s common stock (the “ONCO Warrant”) (such cash payment, shares of ONCO Series D Preferred Stock, and the ONCO Warrant, collectively, the “Settlement Amount”) in full satisfaction of all amounts due under the ONCO Promissory Notes, as amended by all preceding amendments, forbearance agreements, and waivers, in complete discharge of all obligations thereunder. The ONCO Promissory Notes and the Forbearance Agreement terminated upon payment of the Settlement Amounts. There can be no assurances as to whether and when the Company will be able to receive any cash proceeds from the shares of ONCO Series D Preferred Stock, the ONCO Warrant, or any shares of ONCO’s common stock that the Company might acquire upon conversion of the ONCO Series D Preferred Stock or exercise of the ONCO Warrant.

Current wording

As of September 22, 2025, an aggregate of $8.8 million was payable to the Company under the ONCO Promissory Notes and related amendments. On September 22, 2025, the Company and ONCO entered into a Settlement Agreement and Release (the “Settlement Agreement”), whereby the Company agreed to accept a cash payment of $6.3 million, 3,125 shares of ONCO’s Series D Convertible Preferred Stock (the “ONCO Series D Preferred Stock”) and a warrant to purchase 169,395 shares of ONCO’s common stock (the “ONCO Warrant”) (such cash payment, shares of ONCO Series D Preferred Stock, and the ONCO Warrant, collectively, the “Settlement Amount”) in full satisfaction of all amounts due under the ONCO Promissory Notes, as amended by all preceding amendments, forbearance agreements, and waivers, in complete discharge of all obligations thereunder. The ONCO Promissory Notes and the Forbearance Agreement terminated upon payment of the Settlement Amounts. The Company received proceeds of $3.2 million from the sale of shares of ONCO’s common stock acquired from the conversion of ONCO Series D Preferred Stock during the three months ended March 31, 2026 and $1.8 million from the sale of shares of ONCO’s common stock acquired from the conversion of ONCO Series D Preferred Stock subsequent to March 31, 2026, and after such sales the Company no longer holds any shares of ONCO Series D Preferred Stock. There can be no assurances as to whether and when the Company will be able to receive any cash proceeds from the shares of ONCO Warrant or any shares of ONCO’s common stock that the Company might acquire upon exercise of the ONCO Warrant.

Previous wording

Operating Expenses. Conducting research and development is central to our drug development programs. The Company has several products under development and management routinely evaluates each product in its portfolio of products. Advancement is limited to available working capital and management’s understanding of the prospects for each product. If future prospects do not meet management’s strategic goals, advancement may be discontinued. We have invested and expect to continue to invest significant time and capital in our research and development operations. Our research and development expenses were $1.3 million and $5.7 million for the three months ended December 31, 2025 and 2024, respectively. We expect to continue investing significant resources in research and development in the future due to advancement of our drug candidates.

Current wording

Operating Expenses. Conducting research and development is central to our drug development programs. The Company has several products under development and management routinely evaluates each product in its portfolio of products. Advancement is limited to available working capital and management’s understanding of the prospects for each product. If future prospects do not meet management’s strategic goals, advancement may be discontinued. We have invested and expect to continue to invest significant time and capital in our research and development operations. Our research and development expenses were $3.1 million and $3.9 million for the three months ended March 31, 2026 and 2025, respectively, and $4.5 million and $9.6 million for the six months ended March 31, 2026 and 2025, respectively. We expect to continue investing significant resources in research and development in the future due to advancement of our drug candidates.

Previous wording

General and administrative expenses were $4.1 million in the three months ended December 31, 2025, which is a decrease from $5.2 million in the three months ended December 31, 2024. The decrease is due primarily to a reduction in corporate personnel costs, due to reduced share-based compensation expense of $1.4 million.

Current wording

General and administrative expenses were $4.1 million in the three months ended March 31, 2026, which is a decrease from $5.2 million in the three months ended March 31, 2025. The decrease is due primarily to a reduction in corporate personnel costs, due to reduced share-based compensation expense.

Previous wording

The Company recorded a gain on sale of ENTADFI assets of $0.7 million in the three months ended December 31, 2024. The Company recognized a gain on sale of ENTADFI assets as nonrefundable consideration was received from the ONCO Promissory Notes. The ONCO Promissory Notes are now settled so no additional gain from additional consideration is expected in future periods. Refer to Note 15 to the financial statements included in this report for additional information.

Current wording

The Company recorded a gain on sale of ENTADFI assets of $1.0 million in the three months ended March 31, 2025. The Company recognized a gain on sale of ENTADFI assets as nonrefundable consideration was received from the ONCO Promissory Notes. The ONCO Promissory Notes were settled in fiscal 2025 so no additional gain from additional consideration is expected in future periods. Refer to Note 15 to the financial statements included in this report for additional information.

Previous wording

Research and development expenses decreased to $1.3 million in the three months ended December 31, 2025 from $5.7 million in the same period in fiscal 2024. The decrease in research and development expenses is due primarily to the wind down of the Company’s Phase 2b QUALITY clinical study for enobosarm as a treatment to augment fat loss and to prevent muscle loss, which was completed during fiscal 2025. The Company is preparing for, but has not yet initiated, the Phase 2b PLATEAU clinical study. Personnel costs also decreased due primarily to reduced share-based compensation expense.

Current wording

Research and development expenses decreased to $4.5 million in the six months ended March 31, 2026 from $9.6 million in the same period in fiscal 2025. The decrease in research and development expenses is due primarily to the wind down of the Company’s Phase 2b QUALITY clinical study for enobosarm as a treatment to augment fat loss and to prevent muscle loss, which was completed during fiscal 2025. The Company initiated the Phase 2b PLATEAU clinical study during the three months ended March 31, 2026. Personnel costs also decreased due primarily to reduced share-based compensation expense.

Previous wording

Gain on extinguishment of debt of $8.6 million was recognized during the three months ended December 31, 2024, related to the termination of the Residual Royalty Agreement, in connection with the FC2 Business Sale. The gain was the difference between the change of control payment of $4.2 million and the net carrying amount of the extinguished debt of $12.8 million, which included an embedded derivative for the change of control provision at fair value of $4.7 million.

Current wording

Gain on extinguishment of debt of $8.6 million was recognized during the six months ended March 31, 2025, related to the termination of the Residual Royalty Agreement, in connection with the FC2 Business Sale. The gain was the difference between the change of control payment of $4.2 million and the net carrying amount of the extinguished debt of $12.8 million, which included an embedded derivative for the change of control provision at fair value of $4.7 million.

Previous wording

The Company recorded a net loss from discontinued operations, net of taxes, related to the FC2 business of $7.1 million for the three months ended December 31, 2024. The net loss from discontinued operations during the three months ended December 31, 2024 is attributable to the operations of the FC2 business during that period and the recognition of the loss on sale of FC2, initially estimated as $4.2 million for the three months ended December 31, 2024 and adjusted to $4.1 million in a subsequent quarter during fiscal 2025. The Company did not recognize any income or loss related to the FC2 business during the three months ended December 31, 2025.

Current wording

Net income from discontinued operations, net of taxes, related to the FC2 business of $351,000 for the six months ended March 31, 2026, which is an additional gain on the sale of the FC2 business for net proceeds received from the Purchaser in the settlement of a dispute related to a pre-closing tax receivable and liability. The Company recorded a net loss from discontinued operations, net of taxes, related to the FC2 business of $7.2 million for the six months ended March 31, 2025. The net loss from discontinued operations during the six months ended March 31, 2025 is attributable to the operations of the FC2 business during that period and the recognition of the loss on sale of FC2, initially estimated as $4.2 million for the six months ended March 31, 2025 and adjusted to $4.1 million in a subsequent quarter during fiscal 2025.

Previous wording

Our cash, cash equivalents, and restricted cash on hand at December 31, 2025 was $33.0 million, compared to $15.8 million at September 30, 2025. Restricted cash included in this balance is $0.1 million at each of December 31, 2025 and September 30, 2025. At December 31, 2025, the Company had working capital of $29.7 million and stockholders’ equity of $37.1 million compared to working capital of $11.1 million and stockholders’ equity of $18.3 million as of September 30, 2025. The increase in working capital is primarily due to an increase in cash, cash equivalents, and restricted cash of $17.2 million and a decrease in accounts payable of $1.6 million.

Current wording

Our cash, cash equivalents, and restricted cash on hand at March 31, 2026 was $27.6 million, compared to $15.8 million at September 30, 2025. Restricted cash included in this balance is $0.1 million at each of March 31, 2026 and September 30, 2025. At March 31, 2026, the Company had working capital of $28.0 million and stockholders’ equity of $34.8 million compared to working capital of $11.1 million and stockholders’ equity of $18.3 million as of September 30, 2025. The increase in working capital is primarily due to an increase in cash, cash equivalents, and restricted cash of $11.8 million, an increase in prepaid expenses of $2.0 million, a decrease in accrued compensation of $1.3 million, and a decrease in accounts payable of $1.0 million.

Previous wording

The Company is not profitable and has had negative cash flow from operations. We will need substantial capital to support our drug development and any related commercialization efforts for our drug candidates. Based upon the Company’s current operating plan, it estimates that its cash and cash equivalents as of the issuance date of the financial statements included in this report are insufficient for the Company to fund operating, investing and financing cash flow needs for the twelve months subsequent to the issuance date of the financial statements included in this report. To obtain the capital necessary to fund our operations, we expect to finance our cash needs through public or private equity offerings, debt financing transactions and/or other capital sources. Additional capital may not be available at such times and in such amounts as needed by us to fund our activities on a timely basis. The Company’s future capital requirements will depend on many factors. See Part I, Item 1A, “Risk Factors - Risks Related to Our Financial Position and Need for Capital” in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2025 for a description of certain risks that will affect our future capital requirements.

Current wording

The Company is not profitable and has had negative cash flow from operations. We will need substantial capital to support our drug development and any related commercialization efforts for our drug candidates. Based upon the Company’s current operating plan, it estimates that its cash and cash equivalents as of the issuance date of the financial statements included in this report are insufficient for the Company to fund operating, investing and financing cash flow needs for the twelve months subsequent to the issuance date of the financial statements included in this report. To obtain the capital necessary to fund our operations, we expect to finance our cash needs through public or private equity offerings, debt financing transactions and/or other capital sources. Additional capital may not be available at such times and in such amounts as needed by us to fund our activities on a timely basis. The Company’s future capital requirements will depend on many factors. See Part I, Item 1A, “Risk Factors - Risks Related to Our Financial Position and Need for Capital” in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2025 and Part II, Item 1A. “Risk Factors” in this Quarterly Report on Form 10-Q for a description of certain risks that will affect our future capital requirements.

Previous wording

Operating activities used cash of $6.2 million in the three months ended December 31, 2025. Cash used in operating activities included net loss of $5.3 million, adjustments to reconcile net loss to net cash used in operating activities totaling an increase of $1.0 million and changes in operating assets and liabilities resulting in a decrease of $1.9 million. Adjustments to net loss primarily consisted of $0.8 million for share-based compensation. The decrease in cash from changes in operating assets and liabilities primarily included a decrease in accounts payable of $1.9 million and an increase in prepaid expenses and other current assets of $0.8 million, partially offset by an increase in accrued expenses and other liabilities of $0.9 million.

Current wording

Operating activities used cash of $15.1 million in the six months ended March 31, 2026. Cash used in operating activities included net loss of $8.1 million, adjustments to reconcile net loss to net cash used in operating activities totaling a decrease of $2.7 million and changes in operating assets and liabilities resulting in a decrease of $4.3 million. Adjustments to net loss primarily consisted of $3.8 million for the gain from the change in fair value of equity securities and $1.2 million for share-based compensation. The decrease in cash from changes in operating assets and liabilities primarily included a decrease in accounts payable of $1.6 million, a decrease in accrued expenses and other liabilities of $1.4 million, and an increase in prepaid expenses and other assets of $1.1 million.

Previous wording

Operating activities used cash of $11.3 million in the three months ended December 31, 2024. Cash used in operating activities included net loss of $8.9 million, adjustments to reconcile net loss to net cash used in operating activities totaling an increase of $1.1 million and changes in operating assets and liabilities resulting in a decrease of $3.5 million. Adjustments to net loss primarily consisted of $4.2 million for the loss on sale of the FC2 business, $3.1 million for the change in fair value of derivative liabilities, and $2.7 million of share-based compensation, partially offset by the gain on extinguishment of debt of $8.6 million. The decrease in cash from changes in operating assets and liabilities included a decrease in accrued expenses and other current liabilities of $1.6 million, a decrease in accounts payable of $1.3 million and an increase in accounts receivable of $0.7 million. The cash flows related to discontinued operations have not been segregated and are included in the consolidated statements of cash flows. Total operating cash flows of discontinued operations for the three months ended December 31, 2024 are outflows of $0.3 million.

Current wording

Operating activities used cash of $19.1 million in the six months ended March 31, 2025. Cash used in operating activities included net loss of $16.8 million, adjustments to reconcile net loss to net cash used in operating activities totaling an increase of $2.5 million and changes in operating assets and liabilities resulting in a decrease of $4.7 million. Adjustments to net loss primarily consisted of $4.9 million for share-based compensation, $4.2 million for the loss on sale of the FC2 business, $3.1 million for the change in fair value of derivative liabilities, partially offset by the gain on extinguishment of debt of $8.6 million and the gain on sale of ENTADFI assets of $1.7 million. The decrease in cash from changes in operating assets and liabilities included a decrease in accrued expenses and other current liabilities of $2.6 million and a decrease in accounts payable of $1.7 million. The cash flows related to discontinued operations have not been segregated and are included in the consolidated statements of cash flows. Total operating cash flows of discontinued operations for the six months ended March 31, 2025 are outflows of $0.3 million.

Previous wording

Net cash provided by investing activities was $17.2 million during the three months ended December 31, 2024, and consisted of net proceeds of $16.2 million from the sale of the FC2 business, proceeds of $0.7 million from the sale of ENTADFI assets, and proceeds of $0.4 million from the sale of equity securities. The cash flows related to discontinued operations have not been segregated and are included in the consolidated statements of cash flows. Total investing cash flows of discontinued operations for the three months ended December 31, 2024 are inflows of $16.2 million, which includes net proceeds from the sale of the FC2 business.

Current wording

The cash flows related to discontinued operations have not been segregated and are included in the consolidated statements of cash flows. Total investing cash flows of discontinued operations for the six months ended March 31, 2026 and 2025 are inflows of $0.3 million and $16.2 million, respectively, which consist of net proceeds from the sale of the FC2 business.

Previous wording

Net cash provided by financing activities in the three months ended December 31, 2025 was $23.4 million, which consisted of proceeds from the sale of common stock and warrants in an underwritten public offering, net of commissions and costs, of $23.4 million.

Current wording

Net cash provided by financing activities in the six months ended March 31, 2026 was $23.4 million, which consisted of proceeds from the sale of common stock and warrants in an underwritten public offering, net of commissions and costs, of $23.4 million.

Previous wording

Net cash used in financing activities in the three months ended December 31, 2024 was $4.2 million, which represented a change of control payment of $4.2 million to SWK pursuant to the Residual Royalty Agreement, which terminated the Residual Royalty Agreement and extinguished the related debt.

Current wording

Net cash used in financing activities in the six months ended March 31, 2025 was $4.2 million, which represented a change of control payment of $4.2 million to SWK pursuant to the Residual Royalty Agreement, which terminated the Residual Royalty Agreement and extinguished the related debt.

Previous wording

Excluding the change of control payment, the Company made total payments under the Residual Royalty Agreement of $0.3 million during the three months ended December 31, 2024. The Company is not required to make any additional payments under the Residual Royalty Agreement.

Current wording

Excluding the change of control payment, the Company made total payments under the Residual Royalty Agreement of $0.3 million during the three and six months ended March 31, 2025. The Company is not required to make any additional payments under the Residual Royalty Agreement.

Previous wording

On May 2, 2023, the Company entered into a common stock purchase agreement (as amended, the “Lincoln Park Purchase Agreement”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”) which provides that, upon the terms and subject to the conditions and limitations set forth therein, the Company has the right, but not the obligation, to sell to Lincoln Park up to $100.0 million of shares (the “Purchase Shares”) of the Company’s common stock over the 36-month term of the Lincoln Park Purchase Agreement. On the date the Company executed the Lincoln Park Purchase Agreement, we also issued 80,000 shares of the Company’s common stock to Lincoln Park as an initial fee for Lincoln Park’s commitment to purchase shares of the Company’s common stock under the Lincoln Park Purchase Agreement, and we are obligated to issue $1.0 million of shares of the Company’s common stock at the time Lincoln Park’s purchases cumulatively reach an aggregate amount of $50.0 million (such shares, collectively, the “Commitment Shares”). On December 13, 2023, the Company entered into an amendment (the “Lincoln Park Amendment”) with Lincoln Park to reduce the amount of shares of common stock subject to the registration from $100.0 million to $50.0 million until the Company has sold at least $50.0 million of shares of common stock under the Lincoln Park Purchase Agreement. The Purchase Shares up to $50.0 million and Commitment Shares under the Lincoln Park Purchase Agreement have been registered pursuant to the Company’s effective shelf registration statement on Form S-3 (File No. 333-270606), and a related prospectus supplement that was filed with the SEC on May 3, 2023, as further supplemented on December 13, 2023 to reflect the Lincoln Park Amendment.

Current wording

On May 2, 2023, the Company entered into a common stock purchase agreement (as amended, the “Lincoln Park Purchase Agreement”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”) which provides that, upon the terms and subject to the conditions and limitations set forth therein, the Company has the right, but not the obligation, to sell to Lincoln Park up to $100.0 million of shares (the “Purchase Shares”) of the Company’s common stock over the 36-month term of the Lincoln Park Purchase Agreement. On the date the Company executed the Lincoln Park Purchase Agreement, we also issued 80,000 shares of the Company’s common stock to Lincoln Park as an initial fee for Lincoln Park’s commitment to purchase shares of the Company’s common stock under the Lincoln Park Purchase Agreement, and we are obligated to issue $1.0 million of shares of the Company’s common stock at the time Lincoln Park’s purchases cumulatively reach an aggregate amount of $50.0 million (such shares, collectively, the “Commitment Shares”). On December 13, 2023, the Company entered into an amendment (the “Lincoln Park Amendment”) with Lincoln Park to reduce the amount of shares of common stock subject to the registration from $100.0 million to $50.0 million until the Company has sold at least $50.0 million of shares of common stock under the Lincoln Park Purchase Agreement. The Purchase Shares up to $50.0 million and Commitment Shares under the Lincoln Park Purchase Agreement have been registered pursuant to the Company’s effective shelf registration statement on Form S-3 (File No. 333-270606), and a related prospectus supplement that was filed with the SEC on May 3, 2023, as further supplemented on December 13, 2023 to reflect the Lincoln Park Amendment. The shelf registration statement on Form S-3 (File No. 333-270606) expired in April 2026, and after that date the Company was unable to sell any securities pursuant to the Lincoln Park Purchase Agreement because such sales would no longer be covered by an effective registration statement. The Company did not have plans to utilize the remaining capacity under the Lincoln Park Purchase Agreement and terminated the agreement effective May 12, 2026.

Previous wording

During the three months ended December 31, 2025 and 2024, we did not sell any shares under the Lincoln Park Purchase Agreement. Since inception of the Lincoln Park Purchase Agreement through December 31, 2025, we have sold 302,500 shares of common stock to Lincoln Park resulting in proceeds to the Company of $3.1 million.

Current wording

During the six months ended March 31, 2026 and 2025, we did not sell any shares under the Lincoln Park Purchase Agreement. Since inception of the Lincoln Park Purchase Agreement through March 31, 2026, we sold 302,500 shares of common stock to Lincoln Park resulting in proceeds to the Company of $3.1 million.

Previous wording

The Company has investments in equity securities consisting of the ONCO Series D Preferred Stock and the ONCO Warrant as of December 31, 2025 and September 30, 2025. The ONCO Series D Preferred Stock and the ONCO Warrant were received on September 22, 2025 as a settlement of the ONCO Promissory Notes. See Note 15 to the financial statements included in this report for additional information. The Company has elected to measure the ONCO Series D Preferred Stock and the ONCO Warrant at fair value in accordance with ASC 825. The investments in the ONCO Series D Preferred Stock and the ONCO Warrant are classified within Level 3 of the fair value hierarchy because there is no market for these types of securities and the fair value is determined using significant unobservable inputs. The fair value of the ONCO Series D Preferred Stock and the ONCO Warrant have been determined using a Monte Carlo simulation model. This valuation model incorporates the contractual terms of the instruments and assumptions including the stock price of ONCO Common Stock, expected volatility, and a selected discount rate. Additionally, the ONCO Series D Preferred Stock and the ONCO Warrant were issued by ONCO as part of a Securities Purchase Agreement, which included the sale of 16,099 shares of Series D convertible preferred stock and warrants to purchase 4,362,827 shares of ONCO Common Stock to eleven institutional investors, for an aggregate purchase price of $12.9 million. The valuation of the ONCO Series D Preferred Stock and ONCO Warrant includes a calibration discount to the proceeds of the original transaction, which was done at arms’ length. The assumptions used in calculating the fair value of the financial instruments represent the Company’s best estimates, but these estimates involve inherent uncertainties and the application of management judgment. As a result, the use of different estimates or assumptions would result in a higher or lower fair value and different amounts being recorded in the Company’s financial statements. Material changes in any of these inputs could result in a significantly higher or lower fair value measurement at future reporting dates, which could have a material effect on our results of operations. See Note 4 to the financial statements included in this report for additional information.

Current wording

The Company has investments in equity securities consisting of the ONCO Series D Preferred Stock and the ONCO Warrant as of March 31, 2026 and September 30, 2025. The ONCO Series D Preferred Stock and the ONCO Warrant were received on September 22, 2025 as a settlement of the ONCO Promissory Notes. See Note 15 to the financial statements included in this report for additional information. The Company has elected to measure the ONCO Series D Preferred Stock and the ONCO Warrant at fair value in accordance with ASC 825. The investments in the ONCO Series D Preferred Stock and the ONCO Warrant are classified within Level 3 of the fair value hierarchy because there is no market for these types of securities and the fair value is determined using significant unobservable inputs. The fair value of the ONCO Series D Preferred Stock and the ONCO Warrant have been determined using a Monte Carlo simulation model. This valuation model incorporates the contractual terms of the instruments and assumptions including the stock price of ONCO Common Stock, expected volatility, and a selected discount rate. Additionally, the ONCO Series D Preferred Stock and the ONCO Warrant were issued by ONCO as part of a Securities Purchase Agreement, which included the sale of 16,099 shares of Series D convertible preferred stock and warrants to purchase 4,362,827 shares of ONCO Common Stock to eleven institutional investors, for an aggregate purchase price of $12.9 million. The valuation of the ONCO Series D Preferred Stock and ONCO Warrant at issuance included a calibration discount to the proceeds of the original transaction, which was done at arms’ length. The calibration discount was reduced to zero as of March 31, 2026 as the Company began to convert the ONCO Series D Preferred Stock during the three months ended March 31, 2026, which had the effect of increasing the fair value of the ONCO Series D Preferred Stock and the ONCO Warrant. The assumptions used in calculating the fair value of the financial instruments represent the Company’s best estimates, but these estimates involve inherent uncertainties and the application of management judgment. As a result, the use of different estimates or assumptions would result in a higher or lower fair value and different amounts being recorded in the Company’s financial statements. Material changes in any of these inputs could result in a significantly higher or lower fair value measurement at future reporting dates, which could have a material effect on our results of operations. See Note 4 to the financial statements included in this report for additional information.