60 DEGREES PHARMACEUTICALS, INC.
For the period ended Mar 31, 2026. Filed May 15, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 15, 2026
SXTP$0.59-35.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-13.
0001554855-25-002032
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-15.
0001554855-26-001058
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 108 previous paragraphs and 114 current paragraphs.
53 unchanged; 26 reworded; 31 added; 23 removed; 6 previous and 4 current paragraphs rearranged.
Tables are not compared: 16 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (31)
Current report
2025 ATM Agreement
Current report
Pursuant to the 2025 ATM Agreement, between January 1, 2026 and January 22, 2026, we sold an aggregate of 418,602 shares at a weighted average price per share of $2.07, generating net proceeds of $834,705, after deducting commissions and certain other offering expenses. We intend to use the net proceeds from the 2025 ATM Offering for general corporate purposes, including working capital, commercialization support for Arakoda, and funding our babesiosis clinical development programs.
Current report
2026 ATM Prospectus Supplement
Current report
On March 2, 2026, we filed a prospectus supplement pursuant to Rule 424(b)(5), updating the amount we were permitted to offer and sell under the 2025 ATM Agreement to allow for additional gross sales proceeds of $1,308,000 (the “2026 ATM Prospectus Supplement”). The 2026 ATM Prospectus Supplement was subsequently amended on March 11, 2026 and March 13, 2026, to increase the maximum aggregate offering price by $981,000 and $565,000, respectively (the “2026 ATM Prospectus Supplement Amendment,” and together with the 2026 ATM Prospectus Supplement the “2026 ATM Offering”).
Current report
Between March 2, 2026 and March 25, 2026, we sold an aggregate of 1,055,106 shares at a weighted average price per share of $2.49 generating net proceeds of $2,535,047, after deducting commissions and certain other offering expenses. We currently expect to use the net proceeds from the 2026 ATM Offering for similar general corporate purposes, including supporting our sales and marketing initiatives and ongoing clinical and preclinical research.
Current report
Due to the decline in our stock price, as of March 31, 2026, we did not have available capacity to sell additional shares under the 2025 ATM Agreement and related prospectus supplements based on the limitations of General Instruction I.B.6 of Form S-3, which restricts the aggregate market value of securities we may sell during any 12-month period to one-third of our public float. Our ability to resume sales under the 2025 ATM Agreement and related prospectus supplements will depend on future increases in our stock price or the passage of time such that prior sales are no longer counted within the trailing 12-month measurement period.
Current report
Reverse Stock Split and Nasdaq Delisting Notice
Current report
On January 20, 2026, we received a notice from the Listing Qualifications Department of the Nasdaq Stock Market LLC (“Nasdaq”) indicating that Nasdaq staff had determined to delist our common stock and warrants from The Nasdaq Capital Market because our common stock failed to maintain a minimum bid price of $1.00 per share for 30 consecutive business days, in violation of Nasdaq Listing Rule 5550(a)(2). Upon receipt of the notice, we paid $20,000 for the hearing fee and requested an appeal with Nasdaq, pursuant to the notice, which stayed the suspension of trading and the filing of the Form 25-NSE pending the Panel’s decision.
Current report
At the 2025 Annual Stockholders Meeting in October 2025, our stockholders approved an amendment to our Certificate of Incorporation to effect a reverse stock split of our common stock at a range of ratios between 1:3 to 1:10, and on December 17, 2025, our Board of Directors approved the implementation of the reverse stock split at a ratio of 1:4 (the “1:4 Reverse Stock Split”). Beginning January 20, 2026, our common stock traded on The Nasdaq Capital Market on a split adjusted basis.
Current report
Following the implementation of the 1:4 Reverse Stock Split, on February 11, 2026, we were notified by Nasdaq that we regained compliance with the minimum bid price requirement set forth in Nasdaq Listing Rule 5550(a)(2) and were therefore in compliance with the Nasdaq Capital Market’s listing requirements. As a result, the hearing before the Nasdaq Hearings Panel scheduled for February 19, 2026 was cancelled and the matter was closed. Our common stock and warrants will continue to be listed and traded on The Nasdaq Capital Market.
Current report
The 1:4 Reverse Stock Split did not change the authorized number of shares of common stock or preferred stock. Proportional adjustments were made to the number of shares of common stock issuable upon exercise or conversion of our equity awards, warrants, and other equity instruments convertible into common stock, as well as the respective exercise prices, if applicable in accordance with the terms of the instruments. No fractional shares of common stock were issued in connection with the 1:4 Reverse Stock Split and all fractional shares were rounded up to the nearest whole share with respect to outstanding shares of common stock.
Current report
Unless otherwise noted, all references to numbers of shares of our common stock and per share information presented in this Quarterly Report on Form 10-Q have been retroactively restated, as appropriate, to reflect the effects of the 1:4 Reverse Stock Split.
Current report
Other Operating Revenues
Current report
Operating Expenses
Current report
Research and Development
Current report
General and Administrative Expenses
Current report
For the three months ended March 31, 2026, product revenues – net of discounts and rebates were $162,092, compared to $163,552 for the same period in 2025, a decrease of $1,460, or 0.89%. For the three months ended March 31, 2026, our U.S. pharmaceutical distributor accounted for 90% of total net product sales of Arakoda (compared to 85% in the prior-year period), Infuserve America accounted for 0% (compared to 6%), and Kodatef sales to our Australian distributor accounted for 10% (compared to 9% in the prior-year period). Total net product revenues experienced a slight decline, primarily due to returns associated with expiring product lots during the period.
Current report
Cost of revenues was $85,715 for thethree months ended March 31, 2026, as compared to $73,272 for thethree months ended March 31, 2025. The increase in total cost of revenues was primarily driven by higher quarterly storage costs with our U.S.-based packager. On a per-unit basis, however, cost of revenues declined due to the introduction of the bottle format, which has reduced packaging costs. As a result of these factors, gross margin % decreased to 47.12% for thethree months ended March 31, 2026, from 55.20% in the prior-year period. Thus, our gross profit declined by $13,903 to $76,377 for thethree months ended March 31, 2026, from $90,280 in the prior-year period. Inventory write‑downs for expired product were not a primary driver of the gross margin decline period over period.
Current report
Other Operating Revenues
Current report
Operating Expenses
Current report
Research and Development
Current report
General and Administrative Expenses
Current report
For thethree months ended March 31, 2026, our general and administrative expenses increased by approximately 9.68% or $166,738 from thethree months ended March 31, 2025. The increase was driven by: (1) higher sales, advertising, and promotion expenses ($521,178 vs. $285,287), and (2) higher audit, legal, and professional fees ($248,152 vs. $220,793). These increases were partially offset by lower investor outreach expenses ($197,232 vs. $393,687) and reduced stock-based compensation ($79,524 vs. $142,645). The decrease in stock-based compensation expense is attributable to two partially vested option grants awarded to executives in January 2025.
Current report
Interest and Other Income, net
Current report
Cash Provided by Investing Activities
Current report
Inventory
Current report
We report inventories at the lower of cost or net realizable value. Cost is comprised of direct materials and, where applicable, costs we incur in bringing the inventories to their present location and condition. We use the Specific Identification method per lot. A box or a bottle price is calculated per lot number and sales are recognized by their lot number.
Current report
We regularly monitor our inventory levels to identify inventory that may expire or has a cost basis in excess of its estimated realizable value, and record write-downs for inventory that has expired, inventory that has a cost basis in excess of its expected net realizable value, and inventory in excess of expected sales requirements. We charge any write-downs of inventories to Cost of Revenues in the Consolidated Condensed Statements of Operations and Comprehensive Loss.
Current report
We assess the classification of our derivative financial instruments each reporting period, and determined that such instruments initially qualified for treatment as derivative liabilities as they met the criteria for liability classification under ASC 815. As of March 31, 2026, our derivative liabilities consist of contingent payment arrangements.
Current report
In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”), which amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40. The amendments modernize the recognition and disclosure framework for internal-use software costs, removing the previous “development stage” model and introducing a more judgment-based approach. The ASU is effective for all entities for interim and annual periods beginning after December 15, 2027, with early adoption permitted. We are currently evaluating the impact that ASU 2025-06 will have on our financial statements.
Current report
In September 2025, the FASB issued ASU 2025-07, Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract (“ASU 2025-07”). ASU 2025-07 adds a new scope exception from derivative accounting under ASC 815 for certain non-exchange-traded contracts with customers with an underlying that is based on operations or activities specific to one of the parties to the contract. Further, ASU 2025-07 clarifies that an entity should apply the guidance in ASC 606 to a contract with stock-based noncash consideration. The ASU is effective for annual periods beginning after December 15, 2026 and interim periods within those annual periods, with early adoption permitted. We are currently evaluating the impact that ASU 2025-07 will have on our financial statements.
Removed paragraphs (23)
Previous report
July 2025 Offering
Previous report
On July 15, 2025, we entered into a securities purchase agreement with certain institutional investors pursuant to which we sold, in a registered direct offering (the “July 2025 Offering”),1,753,314 units at an offering price of $1.90 per unit and 878,264 pre-funded units at an offering price of $1.899 per pre-funded unit. Each unit consisted of (i) one share of common stock, (ii) one series A-1 warrant exercisable for one share of common stock (the “July 2025 A-1 Warrants”), and (iii) one series A-2 warrant exercisable for one share of common stock (the “July 2025 A-2 Warrants” and together with the July 2025 A-1 Warrants, the “July 2025 Warrants”). Each pre-funded unit consists of one pre-funded warrant exercisable for one share of common stock (the “July 2025 Pre-Funded Warrants”) and warrants identical to the July 2025 Warrants included in the units. The July 2025 Pre-Funded Warrants have an exercise price of $0.001 per share, and were immediately exercisable beginning on July 16, 2025 until exercised in full. The July 2025 A-1 Warrants have an exercise price of $1.90 per share and are exercisable beginning on July 16, 2025 until July 15, 2030. The July 2025 A-2 Warrants have an exercise price of $1.90 per share and are exercisable beginning on July 16, 2025 until January 15, 2027.
Previous report
As compensation for acting as the placement agent for the July 2025 Offering, we also issued to H.C. Wainwright & Co., LLC warrants (the “July 2025 Placement Agent Warrants”) to purchase up to 197,368 shares of common stock. The July 2025 Placement Agent Warrants have an exercise price equal to $2.375 per share and are exercisable upon issuance, or July 16, 2025, and expire five years from the date of issuance, or July 15, 2030.
Previous report
The July 2025 Offering was made pursuant to our registration statement on Form S-1 (File No. 333-288550), which was declared effective by the Securities and Exchange Commission (the “SEC”) on July 15, 2025, and the final prospectus, which we filed with the SEC on July 16, 2025. The Offering closed on July 16, 2025, resulting in net proceeds of approximately $4,281,300, after deducting placement agent fees and other offering expenses paid by us.
Previous report
Interest and Other Income (Expense), Net
Previous report
Our product revenues - net of discounts and rebates were $437,602 for thethree months ended September 30, 2025, as compared to $135,293 for thethree months ended September 30, 2024. For thethree months ended September 30, 2025, our U.S. pharmaceutical distributor and Infuserve America accounted for 80% and 8% of our total net product sales of Arakoda, respectively, and Kodatef sales to our Australian distributor accounted for 7% of total net product sales (92%,0% and 8% for thethree months ended September 30, 2024, respectively). Domestic, commercial product sales increased substantially in the period due to refilling the supply chain after stocking out in Q2 2025.
Previous report
Cost of Revenues, Gross (Loss) Profit, and Gross Margin
Previous report
Cost of revenues was $537,690 for thethree months ended September 30, 2025, as compared to $111,687 for thethree months ended September 30, 2024. The significant increase in cost of goods sold was primarily due to higher write-offs of inventory not expected to be sold prior to its expiration date. Write-offs of expiring inventory were $436,561 for thethree months ended September 30, 2025, as compared to $1,165 for thethree months ended September 30, 2024. The excess inventory resulted from our strategic decision to validate a new, larger-scale production method with then soon to be expiring raw materials (API), with the offsetting assistance from our USAMMDA grant. The development proved successful but the dating on the produced inventory is already considered in the industry to be short-dated and will have to be replaced by the beginning of the second quarter of 2026. The temporary increase in inventory write-offs was a necessary step in scaling our operations and is not expected to be recurring. Our new larger-scale production processes are expected to help keep inventory costs lower than otherwise. As a result of these factors, the Gross Margin % decreased from 17.45% for thethree months ended September 30, 2024 to a Gross Loss % of 22.87% for thethree months ended September 30, 2025.
Previous report
For thethree months ended September 30, 2025, our general and administrative expenses increased by approximately 24.00% or $291,567 from thethree months ended September 30, 2024. For thethree months ended September 30, 2025, we incurred higher sales, advertising and promotion expenses at $414,718, up from $47,645 for thethree months ended September 30, 2024. Additionally, for thethree months ended September 30, 2025, we incurred higher legal and professional fees at $177,401 ($86,335 for thethree months ended September 30, 2024).
Previous report
Comparison of the Nine Months Ended September 30, 2025, and 2024
Previous report
Our product revenues - net of discounts and rebates were $702,086 for thenine months ended September 30, 2025, as compared to $365,939 for thenine months ended September 30, 2024. For thenine months ended September 30, 2025, our U.S. pharmaceutical distributor and Infuserve America accounted for 73% and 18% of our total net product sales of Arakoda, respectively, and Kodatef sales to our Australian distributor accounted for 6% of total net product sales (94%,0%, and 6% for thenine months ended September 30, 2024, respectively). Despite a shortage of Arakoda 16-ct boxes starting in April 2025, which resulted from a delay in completing commercial validation of a new packaging format, domestic, commercial product sales increased during the period, primarily due to the combination of rising sales, price increases and fewer returns.
Previous report
Arakoda sales volume in Europe continues to grow. We first shipped Arakoda to our distributor Scandinavian Biopharma (“SB”) in September 2022. For thenine months ended September 30, 2025, SB reported 249 boxes sold (109 boxes sold for thenine months ended September 30, 2024). According to our distributor, this is due to greater interest in treating babesiosis. Additionally, we received another purchase order of product from Europe and shipped 1,000 bottles towards the end of August 2025.
Previous report
Cost of revenues was $661,013 for thenine months ended September 30, 2025, as compared to $266,688 for thenine months ended September 30, 2024. The significant increase in cost of goods sold was primarily due to higher write-offs of inventory not expected to be sold prior to its expiration date. Write-offs of expiring inventory were $436,596 for thenine months ended September 30, 2025, as compared to $18,490 for thenine months ended September 30, 2024. The excess inventory resulted from our strategic decision to validate a new, larger-scale production method with then soon to be expiring raw materials (API), with the offsetting assistance from our USAMMDA grant. The development proved successful but the dating on the produced inventory is already considered in the industry to be short-dated and will have to be replaced by the beginning of the second quarter 2026. The temporary increase in inventory writeoffs was a necessary step in scaling our operations and is not expected to be recurring. Our new larger-scale production processes are expected to help keep inventory costs lower than otherwise. Due to these factors, the Gross Margin % decreased from 27.12% for thenine months ended September 30, 2024 to 5.85% for thenine months ended September 30, 2025.
Previous report
The research revenues earned by us were $390,630 for thenine months ended September 30, 2025, as compared to $43,177 for thenine months ended September 30, 2024. The increase in research revenues is primarily due to the new USAMMDA contract we were awarded in July 2024 to facilitate commercial validation of a new bottle and replacement blister packaging of Arakoda and the contract we signed with the University of Kentucky for tafenoquine clinical trial supply. We recognized research revenues of $285,874 related to the USAMMDA grant for thenine months ended September 30, 2025 ($12,994 for thenine months ended September 30, 2024). We recognized research revenues of $89,302 from the University of Kentucky for thenine months ended September 30, 2025 ($0 for thenine months ended September 30, 2024). Other research revenues were $15,454 for thenine months ended September 30, 2025 ($30,183 for thenine months ended September 30, 2024).
Previous report
Research and development costs decreased by $2,905,288 for thenine months ended September 30, 2025 when compared to thenine months ended September 30, 2024. The decline is primarily attributable to a non-cash charge of $3,225,000 recognized during thenine months ended September 30, 2024 related to share-based payments issued to vendors in January 2023 as advance consideration, which payments were initially deferred and capitalized. Kentucky Technology, Inc. delivered us a report on the potential development of SJ733 + tafenoquine in the second quarter of 2024 and Trevally completed the synthesis of 8.8 kilograms of castanospermine in the third quarter of 2024, resulting in $2,625,000 and $600,000, respectively, of research and development expense recognized for thenine months ended September 30, 2024. Otherwise, research and development costs incurred for thenine months ended September 30, 2025 and 2024 primarily consisted of costs related to our babesiosis trial for tafenoquine. Direct trial-related costs represent 76% of the total research and development costs at $1,109,279 for thenine months ended September 30, 2025, compared to 19% of the costs at $846,323 for thenine months ended September 30, 2024. We also recorded $204,112 in research and development expenses related to commercial validation and packaging of Arakoda, for which a majority qualifies for reimbursement under the USAMMDA grant discussed above.
Previous report
For thenine months ended September 30, 2025, our general and administrative expenses increased by approximately 40.53% or $1,385,901 from thenine months ended September 30, 2024. For thenine months ended September 30, 2025, we incurred significantly higher sales, advertising and promotion expenses and investor outreach expenses at $1,095,102 and $992,044, up from $226,024 and $684,808 for thenine months ended September 30, 2024, respectively. Additionally, for thenine months ended September 30, 2025, we recognized $212,030 in stock-based compensation expense ($15,246 for thenine months ended September 30, 2024). This increase was in part due to new partially vested option grants awarded to two executives in January 2025, as well as the ongoing quarterly expense recognized for additional stock options granted in the third quarter of 2024.
Previous report
Interest and Other (Expense) Income, net
Previous report
Interest Expense
Previous report
Other Income, net
Previous report
For thenine months ended September 30, 2025, we recognized $74,938 in other income compared to $67,358 for thenine months ended September 30, 2024. For thenine months ended September 30, 2025, we recognized interest income from cash invested in interest-bearing accounts and investments in certificates of deposit of $80,150 ($59,192 for thenine months ended September 30, 2024). Other income for thenine months ended September 30, 2024 also included $10,789 of storage revenue recognized in association with final payment under the legacy contract with the USAMMDA for storing Arakoda purchases. We did not recognize storage revenue for the nine months ended September 30, 2025.
Previous report
Cash Provided by (Used in) Investing Activities
Previous report
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”) which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses and segment profit or loss. ASU 2023-07 also requires entities with a single reportable segment to provide all segment disclosures under ASC 280, including the new required disclosures under the ASU. We adopted ASU 2023-07 on a retrospective basis for the 2024 annual period, and for interim periods beginning in 2025. The impact is limited to our financial statement disclosures, which are presented in Note 2 to the accompanying consolidated condensed financial statements.
Previous report
In December 2023, the FASB issued ASU 2023-09, Income Taxes (ASC 740): Improvements to Income Tax Disclosures (“ASU 2023-09”) which requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. We will adopt this standard for the annual period ending December 31, 2025. The impact of ASU 2023-09 will be limited to our financial statement disclosures.
Reworded paragraphs (26)
Previous wording
We are a specialty pharmaceutical company with a goal of using cutting-edge biological science and applied research to further develop and commercialize new therapies for the prevention and treatment of infectious diseases. We have successfully achieved regulatory approval of Arakoda® (“Arakoda”), a malaria preventative treatment that has been on the market since late 2019. Currently, 60P’s pipeline under development covers development programs for vector-borne, fungal, and viral diseases utilizing three of the Company’s future products: (i) new products that contain the Arakoda regimen of Tafenoquine; (ii) new products that contain Tafenoquine; and (iii) Celgosivir and/or botanical extracts from Australian Chestnut Trees.
Current wording
We are a specialty pharmaceutical company with a goal of using cutting-edge biological science and applied research to further develop and commercialize new therapies for the prevention and treatment of infectious diseases. We have successfully achieved regulatory approval of Arakoda® (“Arakoda”), a malaria preventative treatment that has been on the market since late 2019. Currently, 60P’s pipeline under development covers development programs for vector-borne diseases utilizing three of the Company’s future products: (I) new products that contain the Arakoda regimen of Tafenoquine; (ii) new products that contain Tafenoquine; and (iii) Australian Chestnut Extract and/or Celgosivir.
Previous wording
On September 5, 2025, we entered into an At-The-Market Sales Agreement (the “2025 ATM Agreement”) with H.C. Wainwright & Co., LLC (“Wainwright”) pursuant to which we may, from time to time, offer and sell shares of our common stock, having aggregate gross sales proceeds of up to $1,397,532 (the “2025 ATM Offering”). As compensation for acting as the sales agent for the 2025 ATM Offering, Wainwright will be entitled to a commission of 3.0% of the gross proceeds from sales of shares in the 2025 ATM Offering. The common stock to be sold under the 2025 ATM Agreement, if any, will be issued and sold pursuant to our shelf registration statement on Form S-3 and accompanying base prospectus (Registration Statement No. 333-280796), which was declared effective by the SEC on July 18, 2024, and our prospectus supplement dated September 5, 2025 relating to the offer and sale of the shares pursuant to the 2025 ATM Agreement. Between October 16, 2025 and November 13, 2025, we sold an aggregate of 125,979 shares at a weighted average price per share of $1.62, generating net proceeds of $196,356, after deducting commissions and certain other offering expenses.
Current wording
On September 5, 2025, we entered into an At-The-Market Sales Agreement (the “2025 ATM Agreement”) with H.C. Wainwright & Co., LLC (“Wainwright”) pursuant to which we were permitted to offer and sell shares of our common stock from time to time for aggregate sales proceeds of up to $1,397,532 (the “2025 ATM Offering”). As compensation for acting as the sales agent for the 2025 ATM Offering, Wainwright was entitled to a commission of 3.0% of the gross proceeds from sales of shares in the 2025 ATM Offering.
Previous wording
As of September 30, 2025, we had cash and cash equivalents of $4,115,779 ($1,659,353 as of December 31, 2024). For thenine months ended September 30, 2025 and 2024, our net cash used in operating activities was $5,156,566 and $4,009,871, respectively. To date, we have financed our operations primarily through the issuance of common stock, warrants to purchase common stock, and proceeds from the issuance of convertible debt and promissory notes. Based on current internal projections, taking into consideration the net proceeds of approximately $4.3 million received from the July 2025 public offering and an additional $196 thousand received through the 2025 ATM Agreement, we estimate that we will have sufficient funds to remain viable through March 31, 2026, assuming no additional capital raises. We cannot give assurance that we can increase our cash balances or limit our cash consumption and thus maintain sufficient cash balances for our planned operations or future acquisitions. Future business demands may lead to cash utilization at levels greater than recently experienced. We may need to raise additional capital in the future. However, we cannot assure you that we will be able to raise additional capital on acceptable terms, or at all.
Current wording
As of March 31, 2026, we had cash and cash equivalents of $3,337,760 ($1,510,065 as of December 31, 2025). For thethree months ended March 31, 2026 and 2025, our net cash used in operating activities was $2,741,559 and $1,597,366, respectively. To date, we have financed our operations primarily through the issuance of common stock, warrants to purchase common stock, and proceeds from the issuance of convertible debt and promissory notes. Based on current internal projections, taking into consideration the net proceeds of approximately $4.3 million received from the July 2025 public offering and approximately $3.8 million in net proceeds received through the 2025 ATM Agreement and related prospectus supplements between October 2025 and March 2026, and excluding licensing and supply chain costs contingent on possible non-objection by FDA to our New Dietary Notification for Australian Chestnut Extract, we estimate that we will have sufficient funds to remain viable through mid-September, 2026, assuming no additional capital raises. However, based on our cash forecasts and planned operating expenditures, we do not currently have sufficient cash and cash equivalents to fund our operating plan for at least the next 12 months from the date of issuance of these financial statements, which raises substantial doubt about our ability to continue as a going concern. Our plans to address these conditions, which include additional equity financings and potential business development transactions, are not currently sufficient to alleviate this substantial doubt. We cannot give assurance that we can increase our cash balances or limit our cash consumption and thus maintain sufficient cash balances for our planned operations or future acquisitions. Future business demands may lead to cash utilization at levels greater than recently experienced. We may need to raise additional capital in the future. However, we cannot assure you that we will be able to raise additional capital on acceptable terms, or at all.
Previous wording
Continuation as a going concern is dependent upon our ability to meet our financial requirements, raise additional capital, and achieve gross profitability from our single marketed product. To achieve profitability, we expect we will need to raise additional capital to fund our activities relating to commercial support for our existing product and any future clinical research trials and operating activities. However, there can be no assurance that we will ever achieve or maintain profitability. These conditions, among others, raise substantial doubt about our ability to continue as a going concern for one year from the date these financial statements are issued.
Current wording
Continuation as a going concern is dependent upon our ability to meet our financial requirements, raise additional capital, and achieve gross profitability from our single marketed product. To achieve profitability, we expect we will need to raise additional capital to fund our activities relating to commercial support for our existing product and any future clinical research trials and operating activities. However, there can be no assurance that we will ever achieve or maintain profitability. Accordingly, there is no assurance that we will be able to obtain the additional capital necessary to fund our operations during the look-forward period. These conditions, among others, raise substantial doubt about our ability to continue as a going concern for one year from the date these financial statements are issued.
Previous wording
As such, we have concluded that such plans do not alleviate the substantial doubt about our ability to continue as a going concern for one year from the date the accompanying financial statements are issued.
Current wording
We have evaluated these conditions and our plans to mitigate them and concluded that, collectively, such plans do not alleviate the substantial doubt about our ability to continue as a going concern for at least one year after the date these consolidated condensed financial statements are issued.
Previous wording
Product Revenues - net of Discounts and Rebates, Cost of Revenues, Gross (Loss) Profit, and Gross Margin
Current wording
Product Revenues - net of Discounts and Rebates
Previous wording
We receive the majority of our product revenues from sales of our Arakoda product to resellers in the U.S. and abroad. Foreign sales to both Australia and Europe are further subject to profit sharing agreements for boxes sold to customers. Sales to resellers in the US are subject to considerable discounts and rebates for services provided by our third-party logistics (“3PL”) partner and wholesalers and pharmacy benefit managers (“PBMs”).
Current wording
We receive the majority of our product revenues from sales of our Arakoda product to resellers in the U.S. and abroad. Foreign sales to both Australia and Europe are further subject to profit sharing agreements for boxes sold to customers. Sales to resellers in the US are subject to considerable discounts and rebates for services provided by our third-party logistics (“3PL”) partner and wholesalers and pharmacy benefit managers (“PBMs”). We recognize revenue when control of Arakoda transfers to our U.S. distributor or 3PL partner, which generally occurs upon shipment. We record product revenue net of estimated discounts, rebates, chargebacks and product returns in accordance with ASC 606. We estimate these forms of variable consideration using the expected value method and constrain estimates to amounts for which it is probable that a significant reversal of cumulative revenue will not occur when the related uncertainties are resolved.
Previous wording
Other operating revenues for the periods presented include research revenue earned from the Australian Tax Authority for research activities conducted in Australia. Beginning in the third quarter of 2024, we began to recognize research revenues associated with our new contract with the United States Army Medical Material Development Activity (USAMMDA) for Arakoda supply chain upgrade support. Research revenue under this contract is recognized when we incur the direct costs eligible for reimbursement, up to the maximum allowable amount.
Current wording
Other operating revenues for the periods presented include research revenue earned from the Australian Tax Authority for research activities conducted in Australia. In 2025, other operating revenues also included research revenues associated with our contract with the United States Army Medical Material Development Activity (USAMMDA) for Arakoda supply chain upgrade support. We recognized research revenue related to the USAMMDA contract over time as qualifying costs were incurred, up to the maximum contractual funding amount. All funded activities under this contract were completed and fully reimbursed by December 31, 2025, and no additional amounts are expected to be earned under the arrangement.
Previous wording
We earn interest income from cash invested in interest-bearing accounts, as well as cash equivalents and short-term investments consisting of certificates of deposits with original maturities ranging from three to six months. Interest expense for the periods presented is limited to a single $150,000 SBA loan that bears interest at 3.75%. Other components ofother income (expense) include changes in the fair value of derivative liabilities and other miscellaneous income or expenses.
Current wording
We earn interest income from cash invested in interest-bearing accounts, as well as cash equivalents and short-term investments consisting of certificates of deposits with original maturities ranging from three to six months. Interest expense for the periods presented is limited to a single $150,000 SBA loan that bears interest at 3.75%. Other components ofother income include changes in the fair value of derivative liabilities and other miscellaneous income or expenses.
Previous wording
We offer discounts and rebates to the civilian U.S. supply chain distribution channel. We record sales when our 3PL partner transfers boxes into their title model. Discounts and rebates offered to our 3PL partner amount to 12% (lower rates available upon reaching larger revenue tiers) along with a $5,500 fixed monthly fee. The product is then transferred usually to one of the three large U.S. pharmaceutical distributors where rebates are 10%. Lastly, we have relationships with several large pharmacy benefit managers (“PBMs”) that allow patients to purchase Arakoda at a discount. The rebate associated with PBMs ranges from 30% to 41.25% depending on the amount of coverage provided. For thenine months ended September 30, 2025, discounts and rebates were $324,948 compared to $324,486 for thenine months ended September 30, 2024.
Current wording
We offer discounts and rebates to the civilian U.S. supply chain distribution channel. Discounts and rebates offered to our 3PL partner amount to 12% (lower rates available upon reaching larger revenue tiers) along with a $5,500 fixed monthly fee. The product is then transferred usually to one of the three large U.S. pharmaceutical distributors where rebates are 10%. Additionally, in the current quarter, we implemented a new partnership with GoodRx where patients can acquire a discount on their purchase. Lastly, we have relationships with several large pharmacy benefit managers (“PBMs”) that allow patients to purchase Arakoda at a discount. The rebate associated with PBMs ranges from 30% to 41.25% depending on the amount of coverage provided. We estimate these forms of variable consideration using the expected value method and constrain estimates to amounts for which it is probable that a significant reversal of cumulative revenue will not occur when the related uncertainties are resolved. Total discounts and rebates for thethree months ended March 31, 2026 were $96,857, an increase of $5,456, or 6%, from $91,401 in the prior-year period.
Previous wording
Arakoda entered the U.S. civilian supply chain in the third quarter of 2019. Since the introduction of the new 8-ct bottle in June 2025, we will be reporting Arakoda unit sales in terms of 16-ct box equivalents. For thethree months ended September 30, 2025, the equivalent of 1,505 16-ct boxes were sold to pharmacies and dispensaries. Sales volume increased by 14% from 1,319 16-ct box equivalents sold to pharmacies and dispensaries for thethree months ended September 30, 2024.
Current wording
Arakoda entered the U.S. civilian supply chain in the third quarter of 2019. Since the introduction of the new 8-ct bottle in June 2025, we will be reporting Arakoda unit sales in terms of 16-ct box equivalents. For thethree months ended March 31, 2026, the equivalent of 1,276 16-ct boxes were sold to pharmacies and dispensaries. Sales volume decreased by 19% from 1,579 16-ct box equivalents sold to pharmacies and dispensaries for thethree months ended March 31, 2025.
Previous wording
Kodatef sales to our distributor Biocelect in Australia for thethree months ended September 30, 2025 were $29,490 ($10,691 for thethree months ended September 30, 2024). A historical portion of sales to Biocelect remained subject to a profit share distribution once the original transfer price has been recouped. Biocelect, which acts as a distributor in the Australian and New Zealand markets, reported a 33% quarter-over-quarter increase, with 552 boxes sold for thethree months ended September 30, 2025, compared to 414 boxes for thethree months ended September 30, 2024. As of September 30, 2025, Biocelect has no inventory left that remains subject to profit share. Additionally, under a new agreement executed during the second quarter, Biocelect began to purchase from the latest manufactured lot of Kodatef at $49.50 AUD per box which are not subject to historical profit share. For the quarter ended September 30, 2025,900 boxes of Kodatef were sold to Biocelect (none for the quarter ended September 30, 2024). As of September 30, 2025, $16,331 of receivables were due to us ($9,444 as of December 31, 2024).
Current wording
Kodatef sales to our distributor Biocelect in Australia for thethree months ended March 31, 2026 were $15,470 ($12,066 for thethree months ended March 31, 2025). A historical portion of sales to Biocelect remained subject to a profit share distribution once the original transfer price has been recouped. Biocelect, which acts as a distributor in the Australian and New Zealand markets, reported an 8% quarter-over-quarter decrease, with 354 boxes sold for thethree months ended March 31, 2026, compared to 386 boxes for thethree months ended March 31, 2025. As of March 31, 2026, Biocelect has no inventory left that remains subject to profit share. Beginning in the first quarter of 2025, Biocelect began to purchase from the latest manufactured lot of Kodatef at $49.50 AUD per box which are not subject to historical profit share. As of March 31, 2026, no receivables were due to us (none as of December 31, 2025).
Previous wording
Arakoda sales volume in Europe continues to grow. We first shipped Arakoda to our distributor Scandinavian Biopharma (“SB”) in September 2022. SB reported 66 boxes sold during thethree months ended September 30, 2025, representing a 22%increase from the 54 boxes sold during thethree months ended September 30, 2024. According to our distributor, the stock out experienced in the US during the second quarter of 2025 also negatively impacted sales for the quarter in Europe. This only became rectified in late August when we sent 1,000 bottles of Arakoda to Europe.
Current wording
Arakoda sales volume in Europe continues to grow. We first shipped Arakoda to our distributor Scandinavian Biopharma (“SB”) in September 2022. SB reported 77 boxes sold during thethree months ended March 31, 2026, representing a 5%increase from the 73 boxes sold during thethree months ended March 31, 2025.
Previous wording
The research revenues earned by us were $90,960 for thethree months ended September 30, 2025, as compared to $12,818 for thethree months ended September 30, 2024. The increase in research revenues is due to the new USAMMDA contract we were awarded in July 2024 to facilitate commercial validation of a new bottle and replacement blister packaging of Arakoda. We recognized research revenues of $90,960 related to the USAMMDA grant for thethree months ended September 30, 2025 ($12,994 for thethree months ended September 30, 2024).
Current wording
The research revenues earned by us were none for thethree months ended March 31, 2026, as compared to $92,731 for thethree months ended March 31, 2025. The decrease in research revenues is due to the USAMMDA contract we were awarded in July 2024 to facilitate commercial validation of a new bottle and replacement blister packaging of Arakoda, which was fully utilized by the end of 2025. We recognized research revenues of $77,966 related to the USAMMDA grant for the three months ended March 31, 2025, compared tonone for thethree months ended March 31, 2026. Research revenues for thethree months ended March 31, 2025 also included $5,138 earned from the Australian Tax Authority for qualifying research activities conducted in Australia. We recognized research revenue related to the USAMMDA contract over time as qualifying costs were incurred, up to the maximum contractual funding amount. All funded activities under this contract were completed and fully reimbursed by December 31, 2025, and no additional amounts are expected to be earned under the arrangement.
Previous wording
Research and development costs decreased by $130,286 for thethree months ended September 30, 2025 when compared to thethree months ended September 30, 2024. The decline is partially attributable to a non-cash charge of $600,000 recognized during thethree months ended September 30, 2024 upon the delivery from Trevally of 8.8 kilograms of castanospermine, for which we had previously issued fully vested shares as advance consideration for the research materials. Otherwise, research and development costs incurred for thethree months ended September 30, 2025 and 2024 primarily consisted of costs related to our babesiosis trials for tafenoquine. Direct trial-related costs represent 81% of the total research and development costs at $656,754 for thethree months ended September 30, 2025, compared to 29% of the costs at $270,497 for thethree months ended September 30, 2024.
Current wording
Research and development costs decreased by $89,349 for thethree months ended March 31, 2026 when compared to thethree months ended March 31, 2025. The decrease was partially driven by $63,015 of packaging validation costs recognized in the prior-year period, with no comparable costs in the current period following the completion of the USAMMDA-funded activities. Otherwise, research and development costs incurred for thethree months ended March 31, 2026 and 2025 primarily consisted of costs related to our babesiosis trials for tafenoquine. Direct trial-related costs represent 68% of the total research and development costs at $191,391 for thethree months ended March 31, 2026, compared to 74% of the costs at $275,633 for thethree months ended March 31, 2025.
Previous wording
For thethree months ended September 30, 2025, we recognized $1,708 of interest expense ($1,467 for thethree months ended September 30, 2024). Our interest expense for the periods presented primarily relates to our single outstanding loan from the SBA. Cash paid for interest expense was $2,193 and $2,193 for thethree months ended September 30, 2025 and September 30, 2024, respectively.
Current wording
For thethree months ended March 31, 2026, we recognized $1,389 of interest expense ($1,790 for thethree months ended March 31, 2025). Our interest expense for the periods presented primarily relates to our single outstanding loan from the SBA. Cash paid for interest expense was $2,193 and $2,193 for thethree months ended March 31, 2026 and March 31, 2025, respectively.
Previous wording
For thethree months ended September 30, 2025, we recognized a loss on the change in fair value of derivative liabilities of $21,103 compared to the loss of $56,712 for thethree months ended September 30, 2024. During the periods presented, derivative liabilities include the contingent milestone payment due to Knight upon a future sale of Arakoda or a Change of Control. We use a probability-weighted expected return method to estimate the fair value of this derivative liability. Generally in the valuation model as we get closer to potential milestones the value of the derivative increases.
Current wording
For thethree months ended March 31, 2026, we recognized a net (loss) gain on the change in fair value of derivative liabilities of $(4,567) compared to $5,105 for thethree months ended March 31, 2025. During the periods presented, derivative liabilities include the contingent milestone payment due to Knight upon a future sale of Arakoda or a Change of Control. We use a probability-weighted expected return method to estimate the fair value of this derivative liability. This method requires significant judgment and is sensitive to changes in assumptions related to the expected timing of payment, the likelihood of potential exit scenarios, and the selected discount rate. The gains and losses recognized during the periods presented are non‑cash in nature and do not impact our liquidity or cash flows.
Previous wording
For thethree months ended September 30, 2025, we recognized $31,550 in other income compared to $16,623 for thethree months ended September 30, 2024. For thethree months ended September 30, 2025, we recognized interest income from cash invested in interest-bearing accounts and investments in certificates of deposit of $32,566 ($16,635 for thethree months ended September 30, 2024).
Current wording
For thethree months ended March 31, 2026, we recognized $10,762 in other income compared to $30,322 for thethree months ended March 31, 2025. For thethree months ended March 31, 2026, we recognized interest income from cash invested in interest-bearing accounts and investments in certificates of deposit of $11,210 ($31,897 for thethree months ended March 31, 2025).
Previous wording
Net cash used in operating activities was $5,156,566 for thenine months ended September 30, 2025, as compared to $4,009,871 for thenine months ended September 30, 2024. Our net cash used in operating activities increased primarily due tohigher general and administrative expenses at $4,805,648 for thenine months ended September 30, 2025 ($3,419,747 for thenine months ended September 30, 2024), as a result of higher sales, advertising and promotion costs and investor outreach expenses, as discussed above, and higher research and development costs for our babesiosis trial at $1,109,279 for thenine months ended September 30, 2025 ($846,323 for thenine months ended September 30, 2024).
Current wording
Net cash used in operating activities was $2,741,559 for thethree months ended March 31, 2026, as compared to $1,597,366 for thethree months ended March 31, 2025. Our net cash used in operating activities increased primarily due tohigher general and administrative expenses at $1,889,874 for thethree months ended March 31, 2026 ($1,723,136 for thethree months ended March 31, 2025), as a result of higher sales, advertising and promotion costs and audit, legal and professional fees, as discussed above. In addition, cash outflows increased due to higher levels of vendor prepayments primarily due to initiating new API production at Piramal during thethree months ended March 31, 2026 when compared to thethree months ended March 31, 2025.
Previous wording
Net cash provided by investing activities was $1,625,347 for thenine months ended September 30, 2025, as compared to net cash used in investing activities of $1,887,016 for thenine months ended September 30, 2024. For thenine months ended September 30, 2025, we received proceeds of $1,708,000 from maturities of certain short-term investments in certificates of deposit ($0 for thenine months ended September 30, 2024). The cash proceeds are partially offset by capitalized patent costs of $20,868 and fixed asset purchases of $60,000 for thenine months ended September 30, 2025 ($49,869 and $103,773 for thenine months ended September 30, 2024, respectively). Additionally, we capitalized less website development costs for thenine months ended September 30, 2025 at $1,785 ($25,374 capitalized for thenine months ended September 30, 2024) associated with enhancements to the functionality of our corporate website.
Current wording
Net cash provided by investing activities was $1,193,560 for thethree months ended March 31, 2026, as compared to $1,702,518 for thethree months ended March 31, 2025. For thethree months ended March 31, 2026, we received proceeds of $1,235,000 from maturities of certain short-term investments in certificates of deposit ($1,708,000 for thethree months ended March 31, 2025). The cash proceeds are partially offset by fixed asset purchases of $30,000 for thethree months ended March 31, 2026 ($2,678 for thethree months ended March 31, 2025). Additionally, for thethree months ended March 31, 2026, we paid cash of $11,440 for capitalized website development costs associated with enhancements to the functionality of our corporate website. We did not have any cash outflows for capitalized website development costs for thethree months ended March 31, 2025.
Previous wording
Net cash provided by financing activities was $5,979,077 for thenine months ended September 30, 2025, as compared to $7,052,598 for thenine months ended September 30, 2024. Thedecrease in net cash provided by financing activities is mainly attributable to net proceeds aggregating to $7,042,608 received in connection with (i) our common stock and warrant offering in January 2024, (ii) the sale of common stock pursuant to the At-the-Market Sales Agreement in July and August 2024, and (iii) the sale of warrants in our Private Placement offering that closed in September 2024, which exceeded the aggregate net proceeds of $5,994,273 received in connection with our common stock and warrant offerings completed in January, February, and July 2025.
Current wording
Net cash provided by financing activities was $3,369,752 for thethree months ended March 31, 2026, as compared to $1,696,899 for thethree months ended March 31, 2025. Theincrease in net cash provided by financing activities is attributable to higher net proceeds from the sale of common stock under our At-the-Market (ATM) Sales Agreement between January and March 2026, which exceeded the aggregate net proceeds of $1,712,973 received from our common stock and warrant offerings completed in January and February 2025.
Previous wording
We also received lower proceeds from the exercise of warrants at $2,804 for thenine months ended September 30, 2025, compared to $9,990 for thenine months ended September 30, 2024. Additionally, for thenine months ended September 30, 2025, we withheld shares valued at $18,000 to cover tax withholdings for net share settlement of certain 2024 performance bonuses awarded to our executives ($0 for thenine months ended September 30, 2024).
Current wording
The increase was partially offset by lower proceeds from warrant exercises, which were $0 for thethree months ended March 31, 2026, compared to $1,926 for thethree months ended March 31, 2025. In addition, during thethree months ended March 31, 2025, we withheld shares valued at $18,000 to cover tax withholdings associated with the net share settlement of certain 2024 performance bonuses awarded to our executives. No such share withholding or net share settlement activity occurred during thethree months ended March 31, 2026.
Previous wording
Our foreign operations were small relative to U.S. operations for thenine months ended September 30, 2025 and September 30, 2024, thus effects of foreign currency translation have been minor.
Current wording
Our foreign operations were small relative to U.S. operations for thethree months ended March 31, 2026 and March 31, 2025, thus effects of foreign currency translation have been minor.
Previous wording
We record U.S. commercial revenues as a receivable when our American distributor transfers shipped product to their title model for 60P. Foreign sales to both Australia and Europe are recognized as a receivable at the point product is shipped to distributor. The shipments to Australia and Europe are further subject to profit sharing agreements for boxes sold to customers.
Current wording
We record U.S. commercial revenues as a receivable when our American distributor transfers shipped product to their title model for 60P. Foreign sales to both Australia and Europe are recognized as a receivable at the point product is shipped to distributor. The shipments to Australia and Europe were further subject to profit sharing agreements for boxes sold to customers.
Previous wording
We analyze all financial instruments with features of both liabilities and equity under ASC Topic 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC Topic 815, Derivatives and Hedging (“ASC 815”). The classification of derivative financial instruments is reassessed each reporting period. Derivative liabilities are adjusted to reflect fair value at each reporting period, with any increase or decrease in the fair value recorded in the results of operations (other income/expense) as change in fair value of derivative liabilities. As of September 30, 2025, derivative liabilities consist of contingent payment arrangements. We use a probability-weighted expected return method to determine the fair value of these instruments.
Current wording
We analyze all financial instruments with features of both liabilities and equity under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic No. 480, Distinguishing Liabilities from Equity (“ASC 480”) and FASB ASC Topic No. 815, Derivatives and Hedging (“ASC 815”). Derivative liabilities are adjusted to reflect fair value at each reporting period, with any increase or decrease in the fair value recorded in the results of operations, as a component of other income or expense as change in fair value of derivative liabilities. We use a probability-weighted expected return method to determine the fair value of these instruments.
Previous wording
From time to time, the FASB issues Accounting Standards Updates (“ASU”) to amend the authoritative literature in the ASC. The Company regularly evaluates new ASUs to determine the impact that these pronouncements may have on the consolidated condensed financial statements. Other than the pronouncements listed below, management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, or (iii) are not applicable to the Company’s consolidated condensed financial statements or related disclosures.
Current wording
From time to time, the FASB issues Accounting Standards Updates (“ASUs”) to amend the authoritative literature in the ASC. We regularly evaluate new ASUs to determine the impact that these pronouncements may have on our consolidated condensed financial statements. Other than the pronouncements listed below, management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, or (iii) are not applicable to our consolidated condensed financial statements or related disclosures.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
The common stock sold under the 2025 ATM Agreement was issued and sold pursuant to our shelf registration statement on Form S-3 and accompanying base prospectus (Registration Statement No. 333-280796), which was declared effective by the SEC on July 18, 2024, and a prospectus supplement dated September 5, 2025, relating to the offer and sale of the shares pursuant to the 2025 ATM Agreement.
Current report — wording carried from elsewhere
As compensation for acting as the sales agent for the 2026 ATM Offering, Wainwright was entitled to a commission of 3.0% of the gross proceeds from the sales of shares in the 2026 ATM Offering.
Current report — wording carried from elsewhere
The common stock sold pursuant to the 2026 ATM Prospectus Supplement was issued and sold pursuant to our shelf registration statement on Form S-3 and accompanying base prospectus (Registration Statement No. 333-280796), which was declared effective by the SEC on July 18, 2024, the prospectus supplement dated September 5, 2025, and the 2026 ATM Prospectus Supplement relating to the offer and sale of the shares pursuant to the 2025 ATM Agreement.
Current report — wording carried from elsewhere
Product Revenues - net of Discounts and Rebates
Rearranged previous paragraphs (6)
Previous report — wording carried elsewhere
We offer discounts and rebates to the civilian U.S. supply chain distribution channel. We record sales when our 3PL partner transfers boxes into their title model. Discounts and rebates offered to our 3PL partner amount to 12% (lower rates available upon reaching larger revenue tiers) along with a $5,500 fixed monthly fee. The product is then transferred usually to one of the three large U.S. pharmaceutical distributors where rebates are 10%. Lastly, we have relationships with several large pharmacy benefit managers (“PBMs”) that allow patients to purchase Arakoda at a discount. The rebate associated with PBMs ranges from 30% to 41.25% depending on the amount of coverage provided. For thethree months ended September 30, 2025, discounts and rebates were $150,532 compared to $122,862 for thethree months ended September 30, 2024. The rebate on Kodatef sales was only 10% and there were no PBM-related discounts on sales of Kodatef.
Previous report — wording carried elsewhere
Arakoda entered the U.S. civilian supply chain in the third quarter of 2019. Since the introduction of the new 8-ct bottle in June 2025, we will be reporting Arakoda unit sales in terms of 16-ct box equivalents. For thenine months ended September 30, 2024,3,642 16-ct box equivalents were sold to pharmacies and dispensaries. Sales volume increased by 14% to 4,166 16-ct box equivalents sold to pharmacies and dispensaries for thenine months ended September 30, 2025.
Previous report — wording carried elsewhere
Kodatef sales to our distributor Biocelect in Australia for thenine months ended September 30, 2025 were $42,775 ($20,697 for thenine months ended September 30, 2024). A historical portion of sales to Biocelect remained subject to a profit share distribution once the original transfer price has been recouped. Biocelect, which acts as a distributor in the Australian and New Zealand market, reported 10% year-over-year decline, the equivalent of 1,334 boxes sold for thenine months ended September 30, 2025, compared to 1,489 boxes for thenine months ended September 30, 2024. As of September 30, 2025, Biocelect has no inventory left that remains subject to profit share. Additionally, under a new agreement executed during the period, Biocelect began to purchase from the latest manufactured lot of Kodatef at $49.50 AUD per box which are not subject to historical profit share. For the nine months ended September 30, 2025,1,100 boxes of Kodatef were sold to Biocelect (None for thenine months ended September 30, 2024). As of September 30, 2025, $16,331 of receivables was due to us ($9,444 as of December 31, 2024).
Previous report — wording carried elsewhere
For thenine months ended September 30, 2025, we recognized $4,719 of interest expense ($6,490 for thenine months ended September 30, 2024). Our interest expense for the periods presented relates primarily to our single outstanding loan from the SBA. Cash paid for interest expense was $6,579 and $6,579 for thenine months ended September 30, 2025 and 2024, respectively.
Previous report — wording carried elsewhere
Change in Fair Value of Derivative Liabilities
Previous report — wording carried elsewhere
For thenine months ended September 30, 2025, we recognized a loss on the change in fair value of derivative liabilities of $156,445 compared to the gain of $1,683,034 for thenine months ended September 30, 2024. During the periods presented, derivative liabilities include the contingent milestone payment due to Knight upon a future sale of Arakoda or a Change of Control. We use a probability-weighted expected return method to estimate the fair value of this derivative liability.