Biofrontera Inc.

PROPOSAL NO. 1**-APPROVAL OF REVERSE STOCK SPLIT PROPOSAL

The Board is asking stockholders to approve the Reverse Split Proposal. The form of the Certificate of Amendment to the Certificate of Incorporation to be filed with the Secretary of State of the State of Delaware (the “Amendment”) is set forth as Appendix A to this proxy statement. Although such filing is within the control of the Board, we expect such filing to be made shortly after the approval by the stockholders of the Reverse Split Proposal. The Amendment will become effective, at such date as is determined by the Board, upon the filing of the Amendment with the Secretary of State of the State of Delaware (which we refer to as the “Effective Time”), but in no event earlier than the date of the Meeting or later than the one-year anniversary of the date on which the Reverse Split Proposal is approved by the Company’s stockholders. Moreover, even if the Amendment is approved by the stockholders, the Board reserves the right, at its discretion, to abandon the Amendment prior to the Effective Time if it determines that abandoning the Amendment is in our best interests. No further action on the part of stockholders would be required to either effect or abandon the Amendment.

The text of the Amendment is subject to modification to include such changes as may be required by the General Corporation Law of the State of Delaware (the “DGCL”) and as the Board deems necessary and advisable to effect the Amendment.

A brief description of the Reverse Split Proposal is set out below.

Purpose of the Reverse Split

The Board seeks your approval of the Reverse Split so as to facilitate an increase in the per share trading price of our Common Stock, which is publicly traded and listed on the Nasdaq Capital Market under the symbol, “BFRI,” in order to regain compliance with the minimum bid price requirement as set forth in Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Requirement”), for continued listing on the Nasdaq. Accordingly, we believe that effecting the Reverse Split would be in our and our stockholders’ best interests.

On May 8, 2025, the Company received a notice letter (the “Notice”) from the Listing Qualifications Department of Nasdaq notifying the Company that, based upon the closing bid price of the Common Stock, for the last 30 consecutive business days, the Company is not currently in compliance with the requirement to maintain the Minimum Bid Requirement.

To regain compliance, the closing bid price of the Common Stock must be at least $1.00 per share for ten consecutive business days at some point during the period of 180 calendar days from the date of the Notice, or November 5, 2025. If the Company does not regain compliance with the minimum bid price requirement by November 5, 2025, Nasdaq may grant the Company a second period of 180 calendar days to regain compliance. To qualify for this additional compliance period, the Company would be required to meet the continued listing requirement for the market value of publicly held shares and all other initial listing standards for Nasdaq, other than the minimum bid price requirement. The Company would also be required to notify Nasdaq of its intent to cure the minimum bid price deficiency. If the Company does not regain compliance within the allotted compliance periods, including any extensions that may be granted by Nasdaq, Nasdaq will provide notice that the Common Stock will be subject to delisting. The Company would then be entitled to appeal that determination to a Nasdaq hearings panel.

In addition, the Board believes that the Reverse Split may the Common Stock a more attractive and cost-effective investment for many investors, which in turn may enhance the liquidity of the holders of the Common Stock, as it believes that the current market price of the Common Stock may prevent certain institutional investors, professional investors, and other members of the investing public from purchasing stock. Many brokerage houses and institutional investors have internal policies and practices that either prohibit them from investing in low-priced stocks or tend to discourage individual brokers from recommending low-priced stocks to their customers. Many institutional investors view stocks trading at low prices as unduly speculative in nature and, as a result, avoid investing in such stocks. The Reverse Split could also increase interest in our Common Stock for analysts and brokers who may otherwise have policies that discourage or prohibit them in following or recommending companies with low stock prices. Moreover, because brokers’ commissions on low-priced stocks generally represent a higher percentage of the stock price than commissions on higher-priced stocks, the current average price per share of Common Stock can result in individual stockholders paying transaction costs representing a higher percentage of their total share value than would be the case if the share price were higher.

Risks of Non-Approval

Failure to approve the Reverse Split Proposal may potentially have serious, adverse effects on the Company and its stockholders. The Common Stock could be delisted from the Nasdaq because shares of the Common Stock may continue to trade below the requisite $1.00 per share price needed to maintain our listing in accordance with Nasdaq Listing Rule 5550(a)(2). Our shares may then trade on the OTC Bulletin Board or other small trading markets, such as the pink sheets. In that event, the Common Stock could trade thinly as a microcap or penny stock, adversely decrease to nominal levels of trading, and may be avoided by retail and institutional investors, resulting in the impaired liquidity of the Common Stock.

As of the Record Date, the Common Stock closed at $0.88 per share on Nasdaq. Reducing the number of outstanding shares of Common Stock should, absent other factors, generally increase the per share market price of the Common Stock. Although the intent of the Reverse Split is to increase the price of the Common Stock, there can be no assurance that even if the Reverse Split is effected the bid price of the Common Stock will be sufficient, over time, for the Company to regain or maintain compliance with the Minimum Bid Requirement.

Principal Effects of the Reverse Split

Depending on the ratio for the Reverse Split determined by the Board, a minimum of five and a maximum of twenty-five shares of existing Common Stock will be combined into one new share of Common Stock. Based on 10,138,567 shares of Common Stock issued and outstanding as of the Record Date (not including Common Stock into which Preferred Stock could have been converted on the Record Date), immediately following the Reverse Split, the Company would have approximately 3,379,522 shares of Common Stock issued and outstanding (without giving effect to rounding for fractional shares) if the ratio for the Reverse Split is one-for-three (1:3), and approximately 1,267,321 shares of Common Stock issued and outstanding (without giving effect to rounding for fractional shares) if the ratio for the Reverse Split is one-for-eight (1:8). Any other ratio selected within such range would result in a number of shares of Common Stock issued and outstanding (not including Common Stock into which Preferred Stock could have been converted on the Record Date, and without giving effect to rounding for fractional shares) following the transaction between approximately 1,267,321 and 3,379,522 shares. Fractional shares will not be issued. Instead, we will issue a full share of post-Reverse Split Common Stock to any stockholder who would have been entitled to receive a fractional share of Common Stock as a result of the Reverse Split.

The actual number of shares issued after giving effect to the Reverse Split, if implemented, will depend on the reverse stock split ratio that is ultimately determined by the Board.

The Reverse Split will affect all holders of our Common Stock uniformly and will not affect any stockholder’s percentage ownership interest in us, except to the extent the Reverse Split would result in fractional shares, as described above. In addition, the Reverse Split will not affect any stockholder’s proportionate voting power, except to the extent the Reverse Split would result in fractional shares, as described above.

The Reverse Split may result in some stockholders owning “odd lots” of less than 100 shares of Common Stock. Odd lot shares may be more difficult to sell, and brokerage commissions and other costs of transactions in odd lots are generally somewhat higher than the costs of transactions in “round lots” of even multiples of 100 shares.

After the Reverse Split is effective, our Common Stock will have new Committee on Uniform Securities Identification Procedures (CUSIP) numbers, which are numbers used to identify our equity securities, and stock certificates with the older CUSIP numbers will need to be exchanged for stock certificates with the new CUSIP numbers by following the procedures described below. We expect that, following the Reverse Split, we will continue to be subject to the periodic reporting and other requirements of the Securities Exchange Act of 1934, as amended, and, assuming that the Company meets the Minimum Bid Price Requirement, that our Common Stock will continue to be quoted on The Nasdaq Capital Market under the symbol “BFRI.”

Beneficial Holders of Common Stock (i.e., stockholders who hold in street name)

Upon the implementation of the Reverse Split, we intend to treat shares held by stockholders through a bank, broker, custodian or other nominee in the same manner as registered stockholders whose shares are registered in their names. Banks, brokers, custodians or other nominees will be instructed to effect the Reverse Split for their beneficial owners holding our Common Stock in street name. However, these banks, brokers, custodians, or other nominees may have different procedures than registered stockholders for processing the Reverse Split. Stockholders who hold shares of our Common Stock with a bank, broker, custodian or other nominee and who have any questions in this regard are encouraged to contact their banks, brokers, custodians or other nominees.

Registered “Book-Entry” Holders of Common Stock (i.e., stockholders that are registered on the transfer agent’s books and records but do not hold stock certificates)

Certain of our registered holders of Common Stock may hold some or all of their shares electronically in book-entry form with the transfer agent. These stockholders do not have stock certificates evidencing their ownership of the Common Stock. They are, however, provided with a statement reflecting the number of shares registered in their accounts.

Stockholders who hold shares electronically in book-entry form with the transfer agent will not need to take action to receive shares of post-Reverse Split Common Stock, as the exchange will be automatic.

Effect of the Reverse Split on Employee Plans, Options, Restricted Stock Awards and Units and Warrants

Based upon the reverse stock split ratio determined by the Board, proportionate adjustments are generally required to be made to the per share exercise price and the number of shares issuable upon the exercise or conversion of all outstanding options, warrants, convertible or exchangeable securities entitling the holders to purchase, exchange for, or convert into, shares of Common Stock. This would result in approximately the same aggregate price being required to be paid under such options, warrants, convertible or exchangeable securities upon exercise, and approximately the same value of shares of Common Stock being delivered upon such exercise, exchange or conversion, immediately following the Reverse Split as was the case immediately preceding the Reverse Split. The number of shares deliverable upon settlement or vesting of restricted stock awards will be similarly adjusted. The number of shares reserved for issuance pursuant to these securities will be proportionately based upon the reverse stock split ratio determined by the Board.

Certain Risks and Potential Disadvantages Associated with a Reverse Split

We cannot assure stockholders that the proposed Reverse Split will sufficiently increase our stock price or be completed before Nasdaq commences delisting procedures. The effect of a Reverse Split on our stock price cannot be predicted with any certainty, and the history of reverse stock splits for other companies, including those in our industry, is varied, particularly since some investors may view a reverse stock split negatively. It is possible that our stock price after the Reverse Split will not increase in the same proportion as the reduction in the number of shares outstanding, causing a reduction in the Company’s overall market capitalization. Further, even if we implement the Reverse Split, our stock price may decline due to various factors, including our future performance and general industry, market and economic conditions. This percentage decline, as an absolute number and as a percentage of our overall market capitalization, may be greater than would occur in the absence of the Reverse Split. If we continue to fail to meet Nasdaq’s listing requirements, Nasdaq may suspend trading and commence delisting proceedings.

The proposed Reverse Split may decrease the liquidity of our Common Stock and result in higher transaction costs. The liquidity of our Common Stock may be negatively impacted by the reduced number of shares outstanding after the Reverse Split, which would be exacerbated if the stock price does not increase following the Reverse Split. In addition, the Reverse Split would increase the number of stockholders owning “odd lots” of fewer than 100 shares, trading in which generally results in higher transaction costs. Accordingly, a Reverse Split may not achieve the desired results of increasing marketability and liquidity as described above.

Stockholders should also keep in mind that the implementation of the Reverse Split will not have an effect on the actual or intrinsic value of our business or a stockholder’s proportional ownership interest (subject to the treatment of fractional shares). However, should the overall value of our Common Stock decline after a Reverse Split, then the actual or intrinsic value of shares held by stockholders will also proportionately decrease as a result of the overall decline in value.

Fractional Shares

No fractional shares will be issued in connection with the Reverse Split. Instead, we will issue one full share of post-reverse stock split Common Stock to any stockholder who would have been entitled to receive a fractional share as a result of the process. Each common stockholder will hold the same percentage of the outstanding Common Stock immediately following the Reverse Split as that stockholder did immediately prior to the Reverse Split, except for minor adjustment due to the additional net share fraction that will need to be issued as a result of the treatment of fractional shares.

Authorized Shares of Capital Stock

Under our Amended and Restated Certificate of Incorporation, we are currently authorized to issue up to a total of 90,000,000 shares of capital stock, comprised of 70,000,000 shares of Common Stock and 20,000,000 shares of Preferred Stock. Authorized shares represent the number of shares of Common Stock that we are permitted to issue under our Amended and Restated Certificate of Incorporation. If the Reverse Split Proposal is implemented, the Amendment would also reduce both the number of issued and outstanding shares of Common Stock and the number of authorized shares of Common Stock in the same ratio as is selected for the Reverse Split.

As a result, immediately following the Reverse Split, the number of authorized shares of Common Stock will be 23,333,333 if the ratio for the Reverse Split selected is one-for-three (1:3), and the number of authorized shares of Common Stock will be 8,750,000 if the ratio for the Reverse Split is one-for-eight (1:8). Any other ratio selected within such range would result in the number of authorized shares of Common Stock following the transaction to be between 8,750,000 and 23,333,333 shares.

As a result of the decrease in authorized shares of Common Stock that will occur if and when the Reverse Split is effected, the same proportion of authorized but unissued shares of Common Stock to shares of Common Stock authorized and issued (or reserved for issuance, including any treasury shares) would be maintained as of the Effective Time (except for any changes as a result of the treatment of fractional shares).

If the Reverse Split is abandoned or deemed to be abandoned by our Board, the decrease in the number of authorized shares will also be abandoned or deemed to be abandoned by our Board.

Appraisal Rights

Under the Delaware General Corporation Law, our stockholders are not entitled to appraisal or dissenter’s rights with respect to the Reverse Split, and we will not independently provide our stockholders with any such rights.

Accounting Matters

The Reverse Split will not affect the par value of our Common Stock. As a result, on the effective date of the reverse stock split, the stated capital account on our balance sheet attributable to the Common Stock will be reduced by up to 96% of its present amount, as the case may be, based on the ratio for the reverse stock split as determined by our Board, with the additional paid-in capital account being credited with the amount by which the stated capital account is reduced. The per share net loss and net book value of our Common Stock will be retroactively adjusted for each period because there will be fewer shares of our Common Stock outstanding for all periods presented.

U.S. Federal Income Tax Consequences of the Reverse Split

The following is a summary of certain material U.S. federal income tax consequences of the Reverse Split to the holders of our Common Stock. It addresses only stockholders who hold our Common Stock as capital assets. It does not purport to be complete and does not address all aspects of U.S. federal income taxation that may be relevant to holders in light of their particular circumstances, such as U.S. federal estate or gift taxes, the alternative minimum tax or the Medicare tax on investment income, and the effect on stockholders subject to special rules, including without limitation financial institutions, tax-exempt organizations, insurance companies, dealers in securities, foreign stockholders, stockholders who hold their pre-Reverse Split shares as part of a straddle, hedge or conversion transaction, and stockholders who acquired their pre-Reverse Split shares pursuant to the exercise of employee stock options or otherwise as compensation. In addition, this summary does not consider or discuss the tax treatment of partnerships or other pass-through entities or persons that hold our shares through such entities.

This summary is based on the Internal Revenue Code of 1986, as amended (the “Code”), regulations, rulings, and decisions in effect on the date hereof, all of which are subject to change (possibly with retroactive effect) and to differing interpretations. It does not address tax considerations under state, local, foreign and other laws. This summary is for general information purposes only, and the tax treatment of a stockholder may vary depending upon the particular facts and circumstances of such stockholder. Stockholders are urged to consult with their own tax advisors with respect to the tax consequences of the Reverse Split.

The Reverse Split is intended to constitute a “recapitalization” within the meaning of Section 368(a)(1)(E) of the Code for U.S. federal income tax purposes. Assuming that such treatment is correct, the Reverse Split generally will not result in the recognition of gain or loss for U.S. federal income tax purposes, except potentially with respect to any additional fractions of a share of our Common Stock received as a result of the rounding up of any fractional shares that otherwise would be issued, as discussed below. Subject to the following discussion regarding a stockholder’s receipt of a whole share of our Common Stock in lieu of a fractional share, the adjusted basis of the new shares of Common Stock will be the same as the adjusted basis of the Common Stock exchanged for such new shares. The holding period of the new, post-Reverse Split shares of the Common Stock resulting from implementation of the Reverse Split will include the stockholder’s respective holding periods for the pre-Reverse Split shares. Stockholders who acquired their shares of our Common Stock on different dates or at different prices should consult their tax advisors regarding the allocation of the tax basis of such shares.

As described above in “Fractional Shares”, no fractional shares of our Common Stock will be issued as a result of the Reverse Split. Instead, we will issue one (1) full share of the post-Reverse Split Common Stock to any stockholder who would have been entitled to receive a fractional share as a result of the process. The U.S. federal income tax consequences of the receipt of such additional fraction of a share of our Common Stock are not clear. A stockholder who receives one (1) whole share of our Common Stock in lieu of a fractional share may recognize income or gain in an amount not to exceed the excess of the fair market value of such share over the fair market value of the fractional share to which such stockholder was otherwise entitled. We are not making any representation as to whether the receipt of one (1) whole share in lieu of a fractional share will result in income or gain to any stockholder, and stockholders are urged to consult their own tax advisors as to the possible tax consequences of receiving a whole share in lieu of a fractional share in the Reverse Split.

We have not sought, and will not seek, any ruling from the Internal Revenue Service or an opinion of tax counsel with respect to the matters discussed herein. The foregoing views are not binding on the Internal Revenue Service or the courts, and there can be no assurance that the Internal Revenue Service or the courts will accept the positions expressed above. The state and local tax consequences of a reverse stock split may vary significantly as to each holder of our Common Stock, depending upon the state in which such holder resides or does business. Accordingly, stockholders should consult with their own tax advisors with respect to all of the potential tax consequences of the Reverse Split.

Reservation of Right to Abandon Reverse Split

We reserve the right to not file the Certificate of Amendment and to abandon any Reverse Split without further action by our stockholders at any time before the effectiveness of the filing with the Secretary of the State of Delaware of the Certificate of Amendment, even if the Reverse Split Proposal is approved by our stockholders at the Meeting. By voting in favor of the Reverse Split, you are expressly also authorizing the Board to delay, not proceed with, or abandon the Reverse Split and the Certificate of Amendment if the Board should so decide, in its sole discretion, that such actions are in the best interests of our stockholders.

Consequences if the Reverse Split is Not Approved

In the event that the Reverse Split is not approved, there is a significant likelihood that we will be delisted from the Nasdaq Capital Market. If we are unable to achieve an increase in our stock price and our Common Stock is subsequently delisted, it could significantly and negatively affect our ability to obtain debt or equity financing in order to support Company operations.

The approval of the Reverse Split Proposal requires the affirmative vote of a majority of our outstanding shares of Common Stock entitled to vote on the Reverse Split Proposal at the Meeting. Abstentions will be counted as votes against the proposal. Because we believe that this proposal is considered a routine matter, discretionary votes by brokers will be counted.

THE BOARD RECOMMENDS THAT YOU VOTE“FOR”THE REVERSE STOCK SPLIT PROPOSAL.