PROVECTUS BIOPHARMACEUTICALS, INC.

Previous wording

The following discussion is intended to assist in the understanding and assessment of significant changes and trends related to our results of operations and our financial condition together with our consolidated subsidiaries. This discussion and analysis should be read in conjunction with the accompanying unaudited condensed financial statements and our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on March 28, 2024 (“2023 Form 10-K”), which includes additional information about our critical accounting policies and practices and risk factors. Historical results and percentage relationships set forth in the consolidated statement of operations, including trends which might appear, are not necessarily indicative of future operations.

Current wording

The following discussion is intended to assist in the understanding and assessment of significant changes and trends related to our results of operations and our financial condition together with our consolidated subsidiaries. This discussion and analysis should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 28, 2025 (“2024 Form 10-K”), which includes additional information about our critical accounting policies and practices and risk factors. Historical results and percentage relationships set forth in the consolidated statement of operations, including trends which might appear, are not necessarily indicative of future operations.

Previous wording

For the three months ended September 30, 2024 and September 30, 2023, there was $109,745 and $69,733, respectively, of grant revenue recognized related to qualifying expenses that were incurred and included within research and development expenses on the condensed consolidated statements of operations.

Current wording

For the three months ended March 31, 2025 and 2024, there was $278,628 and $238,072, respectively, of grant revenue recognized related to qualifying expenses that were incurred and included within research and development expenses on the condensed consolidated statements of operations.

Previous wording

Interest expense decreased by $2,845 or 4.6% from $61,524 for the three months ended September 30, 2023 to $58,679 for the three months ended September 30, 2024. The decrease was mainly due to the interest expense costs incurred in connection with the lower average notes payable balances.

Current wording

Interest expense increased by $6,884 or 12.1% from $56,777 for the three months ended March 31, 2024 to $63,661 for the three months ended March 31, 2025. The increase was mainly due to the interest expense costs incurred in connection with notes payable balances.

Previous wording

The Company’s cash and restricted cash were $614,189 at September 30, 2024 which includes $426,732 of restricted cash resulting from a grant received from the State of Tennessee, compared to $1,026,799 at December 31, 2023, which included $950,223 of restricted cash. The Company’s working capital deficit was $5,464,760 and $7,652,098 as of September 30, 2024 and December 31, 2023, respectively. We have continuing net losses and negative cash flows from operating activities. In addition, we have an accumulated deficit of $255,055,650 as of September 30, 2024. These conditions raise substantial doubt about our ability to continue as a going concern for a period within one year from the date that the financial statements included elsewhere in this Quarterly Report on Form 10-Q are issued. The condensed consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q have been prepared on a basis that contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. Our financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern. Our ability to continue as a going concern depends on our ability to obtain additional financing as may be required to fund current operations.

Current wording

The Company’s cash and restricted cash were $469,454 at March 31, 2025, which includes $79,019 of restricted cash resulting from a grant received from the State of Tennessee, compared to $489,726 at December 31, 2024, which included $182,284 of restricted cash. The Company’s working capital deficit was $5,085,769 and $5,998,712 as of March 31, 2025 and December 31, 2024, respectively. We have continuing net losses and negative cash flows from operating activities. In addition, we have an accumulated deficit of $258,563,069 as of March 31, 2025. These conditions raise substantial doubt about our ability to continue as a going concern for a period within one year from the date that the financial statements included elsewhere in this Quarterly Report on Form 10-Q are issued. The condensed consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q have been prepared on a basis that contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. Our financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern. Our ability to continue as a going concern depends on our ability to obtain additional financing as may be required to fund current operations.

Previous wording

As of September 30, 2024, cash required for our current liabilities included approximately $2,977,080 for accounts payable and other accrued expenses (including operating lease liabilities) and a $110,544 note payable related to our short-term financing of our commercial insurance policies. Also, if not converted prior to maturity, convertible debt in the amount of $2,653,000 plus accrued interest will mature one year from the date of the notes. The Company intends to meet these cash requirements from its current cash balance and from future financing.

Current wording

As of March 31, 2025, cash requirements for our current liabilities include approximately $2,961,035 for accounts payable and other accrued expenses (including lease liabilities) and $124,578 note payable related to our short-term financing of our commercial insurance policies. Also, if not converted prior to maturity, convertible debt in the amount of $2,440,000 plus $152,145 of accrued interest will mature one year from the date of the notes. The 2021, 2022, and 2024 Notes are only subject to repayment in the event of a change of control or event of default. The Company intends to meet these cash requirements from its current cash balance and from future financing.

Previous wording

Management plans to access capital resources through possible public or private equity offerings, including the 2024 Financing, equity financings, debt financings, corporate collaborations, or other means. If we are unable to raise sufficient capital, we will not be able to pay our obligations as they become due.

Current wording

Management plans to access capital resources through possible public or private equity offerings, including the 2025 Financing, exchange offers, debt financings, corporate collaborations, or other means. If we are unable to raise sufficient capital through the 2025 Financing or otherwise, we will not be able to pay our obligations as they become due.

Previous wording

The primary business objective of management is to build the Company into a commercial-stage biotechnology company; however, there can be no assurance that management will be successful in implementing the Company’s business plan of developing, licensing, and/or commercializing our prescription drug candidates. Moreover, even if we are successful in improving our current cash flow position, we nonetheless plan to seek additional funds to meet our current and long-term requirements in 2024 and beyond. We anticipate that these funds will otherwise come from the proceeds of private placement transactions, the exercise of outstanding stock options, or public offerings of debt or equity securities. While we believe that we have a reasonable basis for our expectation that we will be able to raise additional funds, there can be no assurance that we will be able to obtain funds on commercially acceptable terms, or complete additional financing in a timely manner. In addition, any such financing may result in significant dilution to stockholders.

Current wording

The primary business objective of management is to build the Company into a commercial-stage biotechnology company; however, we cannot assure you that management will be successful in implementing the Company’s business plan of developing, licensing, and/or commercializing our prescription drug candidates. Moreover, even if we are successful in improving our current cash flow position, we nonetheless plan to seek additional funds to meet our current and long-term requirements in 2025 and beyond. We anticipate that these funds will otherwise come from the proceeds of private placement transactions, including the 2025 Financing, exercise of outstanding stock options, or public offerings of debt or equity securities. While we believe that we have a reasonable basis for our expectation that we will be able to raise additional funds, we cannot assure you that we will be able to complete additional financing in a timely manner. In addition, any such financing may result in significant dilution to stockholders.

Previous wording

We prepare our condensed consolidated financial statements in accordance with U.S. GAAP, which require our management to make estimates that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the balance sheet dates, as well as the reported amounts of revenues and expenses during the reporting periods. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations would be affected. We base our estimates on our own historical experience and other assumptions that we believe are reasonable after taking account of our circumstances and expectations for the future based on available information. We evaluate these estimates on an ongoing basis.

Current wording

We prepare our consolidated financial statements in accordance with U.S. GAAP, which require our management to make estimates that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the balance sheet dates, as well as the reported amounts of revenues and expenses during the reporting periods. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations would be affected. We base our estimates on our own historical experience and other assumptions that we believe are reasonable after taking account of our circumstances and expectations for the future based on available information. We evaluate these estimates on an ongoing basis.