CHAMPIONS ONCOLOGY, INC.

Previous wording

We are engaged in the development and sale of advanced technology solutions and products to personalize the development and use of oncology drugs through our Translational Oncology Solutions ("TOS"). This technology ranges from computational-based discovery platforms, unique oncology software solutions, and innovative and proprietary experimental tools such as in vivo, ex vivo and biomarker platforms. Utilizing our TumorGraft Technology Platform (the "Platform"), a comprehensive bank of unique, well characterized models, we provide select services to pharmaceutical and biotechnology companies seeking personalized approaches to drug development. By performing studies to predict the efficacy of oncology drugs, our Platform facilitates drug discovery with lower costs and increased speed of drug development as well as increased adoption of existing drugs.

Current wording

We are engaged in the development and sale of advanced technology solutions and products to personalize the development and use of oncology drugs through our Translational Oncology Solutions ("TOS"). This technology ranges from computational-based discovery platforms, unique oncology software solutions, and innovative and proprietary experimental tools such as in vivo, ex vivo and biomarker platforms. Utilizing our TumorGraft Technology Platform (the "Platform"), a comprehensive bank of unique, well characterized Patient Derived Xenograft ("PDX") models, we provide select services to pharmaceutical and biotechnology companies seeking personalized approaches to drug development. By performing studies to predict the efficacy of oncology drugs, our Platform facilitates drug discovery with lower costs and increased speed of drug development as well as increased adoption of existing drugs.

Previous wording

We offer Lumin Bioinformatics ("Lumin"), an oncology data-driven Software as a Service ("SaaS") program. Our Lumin software contains comprehensive information derived from our research services and clinical studies. Lumin leverages our large Datacenter coupled with analytics and artificial intelligence to provide a robust tool for computational cancer research. Insights developed using Lumin can provide the basis for biomarker hypotheses, reveal potential mechanisms of therapeutic resistance, and guide the direction of additional preclinical evaluations.

Current wording

We also offer Lumin Bioinformatics ("Lumin"), an oncology data-driven Software as a Service ("SaaS") program. Our Lumin software contains comprehensive information derived from our research services and clinical studies. Lumin leverages our large Datacenter coupled with analytics and artificial intelligence to provide a robust tool for computational cancer research. Insights developed using Lumin can provide the basis for biomarker hypotheses, reveal potential mechanisms of therapeutic resistance, and guide the direction of additional preclinical evaluations.

Previous wording

Under ASC Subtopic 205-40, Presentation of Financial Statements—Going Concern (“ASC 205-40”), the Company has the responsibility to evaluate whether conditions and/or events raise substantial doubt about its ability to meet its future financial obligations as they become due within one year after the date that the financial statements are issued. The following conditions raised substantial doubt about our ability to continue as a going concern: a history of net losses, working capital deficits, accumulated deficit and declining cash position. Going concern matters are more fully discussed in Notes to the Consolidated Financial Statements, Note 2, Summary of Significant Accounting Policies. No adjustments have been made to the financial statements as a result this uncertainty.

Current wording

Under ASC Subtopic 205-40, Presentation of Financial Statements—Going Concern (“ASC 205-40”), the Company has the responsibility to evaluate whether conditions and/or events raise substantial doubt about its ability to meet its future financial obligations as they become due within one year after the date that the financial statements are issued. The following conditions raised substantial doubt about our ability to continue as a going concern: a history of net losses, working capital deficits, accumulated deficit and declining cash position. Going concern matters are more fully discussed in Notes to the Consolidated Financial Statements, Note 2, Summary of Significant Accounting Policies. No adjustments have been made to the financial statements as a result of this uncertainty.

Previous wording

Our liquidity needs have typically arisen from the funding of our research and development programs and the launch of new products, working capital requirements, and other strategic initiatives. Most recently, we have met these cash requirements through cash on hand, working capital management, and sales of products and services. In the past, we have also received proceeds from certain private placements and public offerings of our securities. For the six months ended October 31, 2024, the Company had net income of approximately $2.0 million and cash provided by operations of approximately $28,000. As of October 31, 2024, the Company had an accumulated deficit of approximately $82.6 million and cash on hand of approximately $2.8 million. While we believe we have strategies to increase our revenues and reduce our costs which can be implemented without disrupting the business or completely restructuring the Company, there can be no assurances. In order to continue to fund our operations we may need to raise additional equity or debt capital in the near term and cannot provide any assurance that we will be successful in doing so, and if we can, on whether the terms will be acceptable to us. If we are unable to obtain additional financing in the near future, we may be required to pursue a reorganization proceeding, including under applicable bankruptcy or insolvency laws.

Current wording

Our liquidity needs have typically arisen from the funding of our research and development programs and the launch of new products, working capital requirements, and other strategic initiatives. Most recently, we have met these cash requirements through cash on hand, working capital management, and sales of products and services. In the past, we have also received proceeds from certain private placements and public offerings of our securities. For the nine months ended January 31, 2025, the Company had net income of approximately $6.5 million and cash provided by operations of approximately $518,000. As of January 31, 2025, the Company had an accumulated deficit of approximately $78.1 million and cash on hand of approximately $3.2 million. While we believe we have strategies to increase our revenues and reduce our costs which can be implemented without disrupting the business or completely restructuring the Company, there can be no assurances. In order to continue to fund our operations we may need to raise additional equity or debt capital in the near term and cannot provide any assurance that we will be successful in doing so, and if we can, on whether the terms will be acceptable to us. If we are unable to obtain additional financing in the near future, we may be required to pursue a reorganization proceeding, including under applicable bankruptcy or insolvency laws.

Previous wording

Research and development expense for the three months ended October 31, 2024 and 2023 were $1.7 million and $2.5 million, respectively, a decrease of approximately $826,000 or 32.8%. Research and development expense for the six months ended October 31, 2024 and 2023 were $3.1 million and $5.3 million, respectively, a decrease of approximately $2.2 million or 40.8%. The decreases in both the three and six month periods were primarily due to a reduction in investment in our developmental programs including target discovery. The declines were primarily from a reduction in salary expense and research agreements.

Current wording

Research and development expense for the three months ended January 31, 2025 and 2024 were $1.7 million and $2.2 million, respectively, a decrease of approximately $467,000 or 21.4%. Research and development expense for the nine months ended January 31, 2025 and 2024 were $4.9 million and $7.5 million, respectively, a decrease of approximately $2.6 million or 35.1%.

Previous wording

Sales and marketing expenses for the three months ended October 31, 2024 and 2023 were $1.8 million, with a slight decrease of $44,000 or 2.5%. Sales and marketing expenses for the six months ended October 31, 2024 and 2023 were $3.4 million and $3.5 million, with a slight decrease of $61,000 or 1.7%. Sales and marketing expenses are primarily comprised of compensation expenses to support business development.

Current wording

Sales and marketing expenses for the three months ended January 31, 2025 and 2024 were $1.8 million, with a slight increase of $9,000 or 0.5%. Sales and marketing expenses for the nine months ended January 31, 2025 and 2024 were $5.2 million and $5.3 million, with a slight decrease of $52,000 or 1.0%. Sales and marketing expenses are primarily comprised of compensation expenses to support business development.

Previous wording

General and administrative expenses for the three months ended October 31, 2024 and 2023 were $1.9 million and $2.6 million, respectively, a decrease of $711,000, or 27.3%. General and administrative expenses for the six months ended October 31, 2024 and 2023 were $4.4 million and $5.5 million, respectively, a decrease of $1,124,000, or 20.3%. General and administrative expenses are primarily comprised of compensation, insurance, professional fees, IT and depreciation and amortization expenses. The decrease for the three and six month periods ended October 31, 2024 was primarily from a decrease in compensation and employee recruitment expenses and an adjustment to our credit loss reserve.

Current wording

General and administrative expenses for the three months ended January 31, 2025 and 2024 were $2.4 million and $2.8 million, respectively, a decrease of $366,000, or 13.2%. General and administrative expenses for the nine months ended January 31, 2025 and 2024 were $6.8 million and $8.3 million, respectively, a decrease of $1.5 million, or 18.0%. General and administrative expenses are primarily comprised of compensation, insurance, professional fees, IT and depreciation and amortization expenses. The decrease for the three-month period ended January 31, 2025 was primarily from a decrease in compensation and employee recruitment expenses. The decrease for the nine-month period ended January 31, 2025 resulted from the combination of a decrease in compensation and employee recruitment expenses.

Previous wording

For the six months ended October 31, 2024, net cash provided by operating activities was $28,000. The cash provided by operating activities was primarily due to income from operations offset by changes in our working capital accounts, including but not limited to, an increase in accounts receivable and a reduction in accounts payable in the ordinary course of business. For the six months ended October 31, 2023, net cash used in operating activities was $3.4 million. The cash used in operating activities was primarily due to the net operating loss during the period.

Current wording

For nine months ended January 31, 2025, net cash provided by operating activities was $518,000. The cash provided by operating activities was primarily due to net income from operations offset by an increase in accounts receivable. Excluding the increase in accounts receivable attributable to the data licensing deal, changes in our accounts receivable was in the ordinary course of business. For the nine months ended January 31, 2024, net cash used in operating activities was $4.3 million. The cash used in operating activities was primarily due to the net operating loss during the period offset by changes in our working capital accounts in the ordinary course of business.

Previous wording

Net cash used in investing activities was $94,000 and $747,000 for the six months ended October 31, 2024 and 2023, respectively. The cash used in investing activities for the current and prior year period was for the investment in additional lab and computer equipment.

Current wording

Net cash used in investing activities was $136,000 and $839,000 for the nine months ended January 31, 2025 and 2024, respectively. The cash used in investing activities for the current and prior year period was for the investment in additional lab and computer equipment.

Previous wording

Net cash provided by financing activities was $202,000 for the six months ended October 31, 2024 . For the six months ended October 31, 2024, the cash provided was from cash received from stock options exercises slightly offset by financing lease payments. Net cash used in financing activities was $456,000 for the six months ended October 31, 2023. The cash used was due to the Company's' stock repurchase program offset by cash received from stock option exercises.

Current wording

Net cash provided by financing activities was $202,000 for the nine months ended January 31, 2025 . For the nine months ended January 31, 2025, the cash provided was from cash received from stock option exercises slightly offset by financing lease payments. Net cash used in financing activities was $490,000 for the nine months ended January 31, 2024. The cash used was due to the Company's' stock repurchase program plus financing lease payments offset by cash received from stock option exercises.