Scienture Holdings, Inc.

Previous wording

Scienture currently has four primary product candidates in its development pipeline, summarized below, and is engaged in a variety of research and development efforts to develop novel product candidates for the treatment of various disease conditions. To date, Scienture has not generated revenue from product sales and will not generate such revenues until it successfully obtains regulatory approval for, and commercializes, its product candidates. The progress of Scienture products its development pipeline to date is represented by the green bars shown below.

Current wording

Scienture currently has four primary product candidates in its development pipeline, summarized below, and is engaged in a variety of research and development efforts to develop novel product candidates for the treatment of various disease conditions. To date, Scienture has generated limited revenue from product sales and will not generate meaningful revenues until it fully commercializes its approved product candidates and successfully obtains regulatory approval for, and commercializes, its other product candidates. The progress of Scienture products its development pipeline to date is represented by the green bars shown below.

Previous wording

As shown in third party studies of DHE, SCN-104’s mechanism of action for its antimigraine effect is due to its potential action as an agonist at the serotonin 5-HT1D receptors. SCN-104 is intended for subcutaneous administration. SCN-104 is also intended for acute use and is not intended for chronic administration. Scienture has conducted two preclinical studies of SCN-104 and the SCN-104 injection pen: (i) a 30-day repeated dose toxicity study of dimethyl sulfoxide and caffeine following thrice daily, 3 times per week subcutaneous administration in Sprague-Dawley rats and (ii) a 30-day repeated dose toxicity study of dimethyl sulfoxide and caffeine following thrice daily, 3 times per week subcutaneous administration in Göttingen minipigs. Both studies support a conclusion that SCN-102 is considered to have no toxicological significance across hematology, coagulation parameters, clinical chemistry and urinalysis.

Current wording

As shown in third party studies of DHE, SCN-104’s mechanism of action for its antimigraine effect is due to its potential action as an agonist at the serotonin 5-HT1D receptors. SCN-104 is intended for subcutaneous administration. SCN-104 is also intended for acute use and is not intended for chronic administration. Scienture has conducted two preclinical studies of SCN-104 and the SCN-104 injection pen: (i) a 30-day repeated dose toxicity study of dimethyl sulfoxide and caffeine following thrice daily, 3 times per week subcutaneous administration in Sprague-Dawley rats and (ii) a 30-day repeated dose toxicity study of dimethyl sulfoxide and caffeine following thrice daily, 3 times per week subcutaneous administration in Göttingen minipigs. Both studies support a conclusion that SCN-104 is considered to have no toxicological significance across hematology, coagulation parameters, clinical chemistry and urinalysis.

Previous wording

Cash was $15,391 as of June 30, 2025, compared to $308,096 as of December 31, 2024. We expect that our future available capital resources will consist primarily of cash generated from Scienture’s operations, remaining cash balances, borrowings, and additional funds raised through sales of debt and/or equity securities.

Current wording

Cash was $355,692 as of September 30, 2025, compared to $308,096 as of December 31, 2024. We expect that our future available capital resources will consist primarily of cash generated from Scienture’s operations, remaining cash balances, borrowings, and additional funds raised through sales of debt and/or equity securities.

Previous wording

Our principal sources of liquidity have historically been cash provided by operations, sales of business assets and operations from time to time, sales of equity, and borrowings under various debt arrangements. Our principal uses of cash have been for operating expenses, technology development, and acquisitions. After our divestiture of our interest in IPS in April 2025 we no longer generate revenues from operations, and therefore anticipate for the remainder of 2025 our principal sources of, and uses of, cash will be from proceeds of prospective sales of equity and debt securities.

Current wording

Our principal sources of liquidity have historically been cash provided by operations, sales of business assets and operations from time to time, sales of equity, and borrowings under various debt arrangements. Our principal uses of cash have been for operating expenses, technology development, and acquisitions. We anticipate these uses will continue to be our principal sources of, and uses of, cash in the future.

Previous wording

Our primary objectives for the remainder of 2025 are expected to be the continued implementation of Scienture business plan, and to complete potential strategic transactions of our business-to-consumer subsidiaries, which may include a potential sale, spin-off, fund raising, combination or other strategic transaction. There can be no assurance that our operations will generate significant positive cash flow, or that additional funds will be available to us, through borrowings or otherwise, on favorable terms if required in the future, or at all. We may also raise additional funding in the future through the sale of equity.

Current wording

Our primary objectives for the remainder of 2025 are expected to be the continued implementation of Scienture business plan, and to complete potential strategic transactions of our business-to-consumer subsidiaries, which may include a potential sale, spin-off, fund raising, combination or other strategic transaction. There can be no assurance that our operations will generate significant positive cash flow, or that additional funds will be available to us, through borrowings or otherwise, on favorable terms if required in the future, or at all. We may also raise additional funding in the future through the sale of equity securities.

Previous wording

As of June 30, 2025, the Company had an accumulated deficit of $48,823,543. As of June 30, 2025, the Company had $15,391 in cash.

Current wording

As of September 30, 2025, the Company had an accumulated deficit of $52,430,904. As of September 30, 2025, the Company had $355,692 in cash.

Previous wording

Cash used in operating activities for the six months ended June 30, 2025, was $4,990,704, compared to cash used in operations for the six months ended June 30, 2024, of $5,967,718. The decrease in cash used in operations for the six months ended June 30, 2025 compared to 2024 was primarily due to decreases in various expenses, charges and liabilities during the 2025 period.

Current wording

Cash used in operating activities for the nine months ended September 30, 2025, was $8,204,389, compared to cash used in operations for the nine months ended September 30, 2024, of $11,355,826. The decrease in cash used in operations for the nine months ended September 30, 2025 compared to 2024 was primarily due to decreases in various expenses, charges and liabilities during the 2025 period.

Previous wording

Cash provided by (used in) investing activities for the six months ended June 30, 2025, was $0 and cash provided by investing activities was $27,431,815 for the six months ended June 30, 2024. The cash provided by investing activities in the 2024 period was primarily due to the disposition of various assets to Micro Merchant Systems, Inc. in the first quarter of 2024 related to our former web-based market platform, partially offset by the investment in securities of $2,500,000.

Current wording

Cash provided by (used in) investing activities for the nine months ended September 30, 2025, was $0 and cash provided by investing activities was $27,552,791 for the nine months ended September 30, 2024. The cash provided by investing activities in the 2024 period was primarily due to the disposition of various assets to Micro Merchant Systems, Inc. in the first quarter of 2024 related to our former web-based market platform, partially offset by the investment in securities of $2,500,000.

Previous wording

Cash provided by financing activities for the six months ended June 30, 2025, was $4,697,999 compared to $13,896,011 of cash used in financing activities for the six months ended June 30, 2024. Cash provided by financing activities in the 2025 period was due to proceeds from issuance of common stock pursuant to ELOC Agreement. The change was primarily due to the payment of dividends of $12,671,072 and repayment of contingent liability of $1,246,346 in 2024.

Current wording

Cash provided by financing activities for the nine months ended September 30, 2025, was $8,251,985 compared to $15,769,770 of cash used in financing activities for the nine months ended September 30, 2024. Cash provided by financing activities in the 2025 period was due to proceeds from issuance of common stock pursuant to ELOC Agreement. The change was primarily due to the payment of dividends of $12,671,072 and repayment of contingent liability of $1,246,346 in 2024.

Previous wording

There are $0 in revenues for the three months ended June 30, 2025. Revenues decreased by $18,699 compared to the same period ended June 30, 2024 primarily because of the disposition of the assets and operations of Softell completed in February 2024, as well as the IPS disposition in April 2025 as the IPS’ operations that we retained after the disposition to MMS of certain assets in the first quarter of 2024. The assets and operations of IPS that we retained generated limited revenues in the 2024 period but did not generate revenues between April 1, 2025 and the time our disposition of IPS later in April.

Current wording

There are $590,050 in revenues for the three months ended September 30, 2025. Revenues increased by $525,189 compared to the same period ended September 30, 2024 primarily because of the initial batch of pharmaceutical products (SCN – 102) sold via wholesale distribution channels during the quarter ended September 30, 2025 as compared to lower such revenue in same period of 2024 because of a) the disposition of the assets and operations of Softell completed in February 2024 and b) the IPS disposition in April 2025. The assets and operations of IPS that we retained generated limited revenues in the 2024 period but did not generate revenues between April 1, 2025 and the time our disposition of IPS later in April.

Previous wording

For the three-month period ended June 30, 2025, cost of goods sold and gross profit (loss) were $0 and $0, and $19,402 and ($703), all respectively for the same period in 2024. There was no gross profit (loss) as a percentage of sales for the three months ended June 30, 2025, compared to (3.76)% for the three months ended June 30, 2024.

Current wording

For the three-month period ended September 30, 2025, cost of goods sold and gross profit were $15,429 and $574,621, and $60,978 and $3,883, all respectively for the same period in 2024. There was a 97.39% gross profit as a percentage of sales for the three months ended September 30, 2025, compared to 5.99% for the three months ended September 30, 2024.

Previous wording

Wages and salary expense increased by $461,690 for the three months ended June 30, 2025 to $773,739 compared to $312,049 for the comparable period in 2024. The increase is primarily due to an increase in salaries for existing executives, as well as the addition of personnel as part of the Scienture Merger in July 2024, as compared to the same period in 2024, which increased the headcount of the Company’s operations.

Current wording

Wages and salary expense decreased by $457,230 for the three months ended September 30, 2025 to $251,747 compared to $708,977 for the comparable period in 2024. The decrease is primarily due to a decrease in salaries for existing executives and personnel as compared to the same period of 2024 due to the addition of personnel as part of the Scienture Merger in July 2024, which increased the headcount of the Company’s operations.

Previous wording

Professional fees decreased by $299,373 to $209,763 compared to $509,136 for the comparable period in 2024. The decrease was primarily due to decrease in external consulting fees expense in 2025.

Current wording

Professional fees increased by $727,481 to $1,320,845 compared to $593,364 for the comparable period in 2024. The increase was primarily due to increase in external consulting fees expense in 2025.

Previous wording

Accounting and legal expenses increased by $209,975 for the three months ended June 30, 2025 to $381,683 compared to $171,708 for the comparable period in 2024. The increase is primarily due to more SEC filings and corporate actions and contemplated transactions requiring additional accounting and legal services.

Current wording

Accounting and legal expenses increased by $399,510 for the three months ended September 30, 2025 to $1,018,737 compared to $619,227 for the comparable period in 2024. The increase is primarily due to more SEC filings and corporate actions and contemplated transactions requiring additional accounting and legal services.

Previous wording

General and administrative expenses (including stock-based compensation expense) increased by $2,512,343 for the three months ended June 30, 2025, to $2,927,764 compared to $415,421 for the comparable period in 2024. The increase from 2024 was mainly due to shares issued in the second quarter of 2025.

Current wording

General and administrative expenses (including stock-based compensation expense) increased by $1,996,749 for the three months ended September 30, 2025, to $2,165,398 compared to $168,649 for the comparable period in 2024. The increase from 2024 was mainly due to shares issued in the third quarter of 2025 and stock-based compensation expense due to options modifications.

Previous wording

Technology expense decreased by $65,266 for the three months ended June 30, 2025 to $21,408 compared to $86,674 for the comparable period in 2024. The decrease was mainly due to a less of software expense and software support expense after the disposition of IPS.

Current wording

Technology expense decreased by $147,718 for the three months ended September 30, 2025 to $9,756 compared to $157,474 for the comparable period in 2024. The decrease was mainly due to a less of software expense and software support expense after the disposition of IPS.

Previous wording

We had interest expense of $653,493 for the three months ended June 30, 2025, compared to interest expense of $4,949 for the three months ended June 30, 2024. The increase is due to the interest expense on Scienture LLC’s convertible debt, the convertible notes issued in November 2024, and related debt discount amortization on these notes.

Current wording

We had interest expense of $1,803,430 for the three months ended September 30, 2025, compared to interest expense of $217,433 for the three months ended September 30, 2024. The increase is due to the interest expense on Scienture LLC’s convertible debt, the convertible notes issued in November 2024, and related debt discount amortization on these notes.

Previous wording

We recognized a gain on the change in the fair value of the warrant liability of $76,122 for the three months ended June 30, 2025, compared to a loss of $165,132 during the three months ended June 30, 2024, based on the underlying valuation inputs.

Current wording

We recognized a gain on the change in the fair value of the warrant liability of $59,203 for the three months ended September 30, 2025, compared to a gain of $502,178 during the three months ended September 30, 2024, based on the underlying valuation inputs.

Previous wording

We recognized a loss on the change in the fair value of the derivative liability of $662,916 for the three months ended June 30, 2025, based on the underlying valuation inputs and the conversion features of the Debenture issued to Arena.

Current wording

We recognized a gain on the change in the fair value of the derivative liability of $2,356,428 for the three months ended September 30, 2025, based on the underlying valuation inputs and the conversion features and derecognition of derivative liability on full repayment of the Debenture issued to Arena.

Previous wording

During the three months ended June 30, 2025, the Company incurred a net loss from continuing operations of $6,720,573 compared to a net loss from continuing operations of $1,624,741 for the three months ended June 30, 2024. The change was due to the decrease in operating income, other income (expense).

Current wording

During the three months ended September 30, 2025, the Company incurred a net loss from continuing operations of $3,607,361 compared to a net loss from continuing operations of $3,183,601 for the three months ended September 30, 2024. The change was due to the increase in operating expense and other income (expense).

Previous wording

There are $10,258 in revenues for the six months ended June 30, 2025. Revenues decreased by $8,441 compared to the same period ended June 30, 2024 primarily because of the disposition of the assets and operations of Softell completed in February 2024 , as well as the IPS disposition in April 2025 as the IPS’ operations that we retained after the disposition to MMS of certain assets in the first quarter of 2024. The assets and operations of IPS that we retained generated limited revenues in the first quarter of 2025.

Current wording

There are $600,308 in revenues for the nine months ended September 30, 2025. Revenues increased by $516,748 compared to the same period ended September 30, 2024 primarily because of the initial batch of pharmaceutical products (SCN – 102) sold via wholesale distribution channels during quarter ended September 30, 2025 as compared to lower such revenue in same period of 2024 because of a) the disposition of the assets and operations of Softell completed in February 2024 and b) the IPS disposition in April 2025. The assets and operations of IPS that we retained generated limited revenues in the 2024 period but did not generate revenues between April 1, 2025 and the time our disposition of IPS later in April.

Previous wording

For the six-month period ended June 30, 2025, cost of goods sold and gross profit (loss) were $9,585 and $673, and $19,402 and ($703), all respectively for the same period in 2024. Gross profit (loss) as a percentage of sales was 6.56% for the six months ended June 30, 2025, compared to (3.76)% for the six months ended June 30, 2024.

Current wording

For the nine-month period ended September 30, 2025, cost of goods sold and gross profit were $25,014 and $575,294, and $80,380 and $3,180, all respectively for the same period in 2024. Gross profit as a percentage of sales was 95.83% for the nine months ended September 30, 2025, compared to 3.81% for the nine months ended September 30, 2024.

Previous wording

Wages and salary expense increased by $935,163 for the six months ended June 30, 2025 to $1,469,807 compared to $534,644 for the comparable period in 2024. The increase is primarily due to an increase in salaries for executives, as well as the Scienture Merger in July 2024, as compared to the same period in 2024, which increased the headcount of the Company’s operations.

Current wording

Wages and salary expense increased by $477,933 for the nine months ended September 30, 2025 to $1,721,554 compared to $1,243,621 for the comparable period in 2024. The increase is primarily due to an increase in salaries for executives during the first and second quarters of 2025, as well as the Scienture Merger in July 2024, as compared to the same period in 2024, which increased the headcount of the Company’s operations.

Previous wording

Professional fees decreased by $66,076 to $622,613 compared to $688,689 for the comparable period in 2024. The decrease was primarily due to decrease in external consulting fees expense in 2025.

Current wording

Professional fees increased by $661,405 to $1,943,458 compared to $1,282,053 for the comparable period in 2024. The increase was primarily due to increase in external consulting fees expense in 2025.

Previous wording

Accounting and legal expenses increased by $341,753 for the six months ended June 30, 2025 to $852,508 compared to $510,755 for the comparable period in 2024. The increase is primarily due to more SEC filings and corporate actions requiring additional accounting and legal services.

Current wording

Accounting and legal expenses increased by $741,263 for the nine months ended September 30, 2025 to $1,871,245 compared to $1,129,982 for the comparable period in 2024. The increase is primarily due to more SEC filings and corporate actions requiring additional accounting and legal services.

Previous wording

General and administrative expenses (including stock-based compensation expense) decreased by $831,870 for the six months ended June 30, 2025, to $4,283,712 compared to $5,115,582 for the comparable period in 2024. The decrease from 2024 was mainly due to less shares issued in the first and second quarter of 2025 as compared to the fair value of shares issued in the first and second quarter of 2024.

Current wording

General and administrative expenses (including stock-based compensation expense) increased by $1,164,879 for the nine months ended September 30, 2025, to $6,449,110 compared to $5,284,231 for the comparable period in 2024. The increase from 2024 was mainly due to shares issued in 2025 and stock-based compensation expense due to options modifications.

Previous wording

Technology expense decreased by $55,261 for the six months ended June 30, 2025 to $83,028 compared to $138,289 for the comparable period in 2024. The decrease was mainly due to decreased software expense and software support expense.

Current wording

Technology expense decreased by $202,979 for the nine months ended September 30, 2025 to $92,784 compared to $295,763 for the comparable period in 2024. The decrease was mainly due to decreased software expense and software support expense.

Previous wording

We had interest expense of $1,324,277 for the six months ended June 30, 2025, compared to interest expense of $103,464 for the six months ended June 30, 2024. The increase is due to the interest expense on Scienture LLC’s convertible debt, the convertible notes issued in November 2024, and related debt discount amortization on these notes.

Current wording

We had interest expense of $3,127,707 for the nine months ended September 30, 2025, compared to interest expense of $320,897 for the nine months ended September 30, 2024. The increase is due to the interest expense on Scienture LLC’s convertible debt, the convertible notes issued in November 2024, and related debt discount amortization on these notes.

Previous wording

We recognized a gain on the change in the fair value of the warrant liability of $722,108 for the six months ended June 30, 2025, compared to a loss of $895,021 during the six months ended June 30, 2024, based on the underlying valuation inputs.

Current wording

We recognized a gain on the change in the fair value of the warrant liability of $781,311 for the nine months ended September 30, 2025, compared to a loss of $392,843 during the nine months ended September 30, 2024, based on the underlying valuation inputs.

Previous wording

We recognized a loss on the change in the fair value of the derivative liability of $59,594 for the six months ended June 30, 2025, based on the underlying valuation inputs and the conversion features of the Arena convertible debenture.

Current wording

We recognized a gain on the change in the fair value of the derivative liability of $2,296,834 for the nine months ended September 30, 2025, based on the underlying valuation inputs and the conversion features and derecognition of derivative liability on full repayment of the Debenture issued to Arena.

Previous wording

During the six months ended June 30, 2025, the Company incurred a net loss from continuing operations of $9,784,570 compared to a net loss from continuing operations of $8,258,163 for the six months ended June 30, 2024. The change was due to change in operating income, other income (expense).

Current wording

During the nine months ended September 30, 2025, the Company incurred a net loss from continuing operations of $13,391,931 compared to a net loss from continuing operations of $11,441,764 for the nine months ended September 30, 2024. The change was due to change in operating expense, other income (expense).

Previous wording

Net income from discontinued operations was $27,670,294 for the six months ended June 30, 2024. The income was primarily due to the disposal of Softell assets, partially offset by loss on disposal of Superlatus Inc. during the six months ended June 30, 2024.

Current wording

Net income from discontinued operations was $27,670,294 for the nine months ended September 30, 2024. The income was primarily due to the disposal of Softell assets, partially offset by loss on disposal of Superlatus Inc. during the nine months ended September 30, 2024.