bioAffinity Technologies, Inc.

Previous wording

Our diagnostic test, CyPath® Lung, addresses the need for noninvasive detection of early-stage lung cancer. Lung cancer is the leading cause of cancer-related deaths worldwide. Physicians order CyPath® Lung to assist in their assessment of patients who are at high risk for lung cancer. The CyPath® Lung test enables physicians to more confidently identify patients who will likely benefit from timely intervention and more invasive follow-up procedures and those who are likely without lung cancer and should continue routine screening. CyPath® Lung has the potential to increase overall diagnostic accuracy of lung cancer, which could lead to increased survival, fewer unnecessary invasive procedures, reduced patient anxiety, and lower medical costs.

Current wording

Our diagnostic test, CyPath® Lung, addresses the need for noninvasive detection of early-stage lung cancer. Lung cancer is the leading cause of cancer-related deaths worldwide. Physicians order CyPath® Lung to assist in their assessment of patients who are at high risk for lung cancer. The CyPath® Lung test enables physicians to more confidently identify patients who will likely benefit from timely intervention and more invasive follow-up procedures and those who are likely without lung cancer and should continue screening in accordance with guidelines. CyPath® Lung has the potential to increase overall diagnostic accuracy of lung cancer, which could lead to increased survival, fewer unnecessary invasive procedures, reduced patient anxiety, and lower medical costs.

Previous wording

Commercial laboratory services, including CyPath® Lung, are performed at our wholly owned subsidiary PPLS which we acquired by purchasing the assets of Village Oaks Pathology Services, P.A., a Texas professional association d/b/a Precision Pathology Services, that included the CAP-accredited and CLIA-certified commercial laboratory it owned. We now own and operate the clinical anatomic and clinical pathology laboratory. CyPath® Lung is offered for sale to physicians by PPLS.

Current wording

Commercial laboratory services, including CyPath® Lung, are performed at our wholly owned subsidiary PPLS which we acquired by purchasing the assets of Village Oaks Pathology Services, P.A., a Texas professional association d/b/a Precision Pathology Services, that included the CAP-accredited and CLIA-certified commercial laboratory it owned. We own and operate the clinical anatomic and clinical pathology laboratory. CyPath® Lung is offered for sale to physicians by PPLS.

Previous wording

Through our wholly owned subsidiary, OncoSelect® Therapeutics, LLC, we have conducted research that has led to discoveries and advancement of novel cancer therapeutic approaches that specifically and selectively target cancer cells. We expect to present our findings at conferences and publish our research in the near future. We intend to seek strategic partners to develop our therapeutic discoveries which could result in broad-spectrum cancer treatments in the future.

Current wording

Through our wholly owned subsidiary, OncoSelect® Therapeutics, LLC, we have conducted research that has led to discoveries and advancement of novel cancer therapeutic approaches that specifically and selectively target cancer cells. We continue to advance research and development for use of this technology for topical treatment of squamous cell skin cancer. We expect to present our findings at conferences and publish our research in peer-reviewed journals in the near future. We intend to seek strategic partners to develop our therapeutic discoveries which could result in broad-spectrum cancer treatments in the future.

Previous wording

Key financial results for the three months quarter ended March 31, 2025, include:

Current wording

Key financial results for the six months ended June 30, 2025, include:

Previous wording

On May 7, 2025, the Company completed a public offering of securities for gross proceeds to the Company of $3.25 million, before deducting agent fees and other estimated expenses payable by the company. The offering consisted of 10,156,250 shares of our Common Stock, of which 2,371,346 were pre-funded warrants, together with warrants to purchase up to 15,234,375 shares of Common Stock, at a combined offering price for each share of common stock (or pre-funded warrant) and accompanying warrant of $0.32 per share. The warrants have an exercise price of $0.352 per share and have certain provisions that allow for additional shares to be issued in the event of a reverse split of the Company’s common stock. Additionally, the warrants include an anti-dilution adjustment which is subject to stockholders approval.

Current wording

On May 7, 2025, the Company completed a public offering of securities for gross proceeds to the Company of $3.25 million, before deducting agent fees and other estimated expenses payable by the company. The offering consisted of 10,156,250 shares of our Common Stock, of which 2,371,346 were pre-funded warrants, together with warrants to purchase up to 15,234,375 shares of Common Stock, at a combined offering price for each share of common stock (or pre-funded warrant) and accompanying warrant of $0.32 per share. The warrants have an exercise price of $0.352 per share and have certain provisions that allow for additional shares to be issued in the event of a reverse split of the Company’s common stock. Additionally, the warrants include an anti-dilution adjustment which is subject to stockholder approval.

Previous wording

To date, we have devoted a substantial portion of our efforts and financial resources to the development of our diagnostic test, CyPath®Lung. As a result, since our inception in 2014, we have funded our operations principally through private and public sales of our equity (“IPO”). As of March 31, 2025, we had cash and cash equivalents of $0.4 million. As of May 13, 2025, after the 2025 equity financing, we had cash and cash equivalents of $2.3 million, which we expect will not support our operations through August 2025. We have incurred significant losses and negative cash flows from operations since inception and expect to continue to incur losses and negative cash flows for the foreseeable future. Based on the Company’s current expected level of operating expenditures and the cash and cash equivalents on hand at March 31, 2025, management concludes that there is substantial doubt about the Company’s ability to continue as a going concern for a period of at least twelve (12) months subsequent to the issuance of the accompanying condensed consolidated financial statements.

Current wording

To date, we have devoted a substantial portion of our efforts and financial resources to the development of our diagnostic test, CyPath®Lung. As a result, since our inception in 2014, we have funded our operations principally through private and public sales of our equity. As of June 30, 2025, we had cash and cash equivalents of $0.8 million. As of August 14, 2025, after the 2025 equity financing, we had cash and cash equivalents of $0.3 million, which we expect will not support our operations through August 2025. We have incurred significant losses and negative cash flows from operations since inception and expect to continue to incur losses and negative cash flows for the foreseeable future. Based on the Company’s current expected level of operating expenditures and the cash and cash equivalents on hand at June 30, 2025, management concludes that there is substantial doubt about the Company’s ability to continue as a going concern for a period of at least twelve (12) months subsequent to the issuance of the accompanying condensed consolidated financial statements.

Previous wording

Prior to acquisition of the clinical pathology laboratory by PPLS, Village Oaks, under the trade name Precision Pathology Services, had licensed and developed CyPath® Lung as a laboratory developed test (“LDT”) for sale to physicians. The license agreement provided that revenues from the sale would be split evenly between the Company and Village Oaks. In the second quarter of 2022, prior to the acquisition, we started to recognize revenue as part of a limited beta market testing program of the CyPath®Lung test. We have never been profitable, and as of March 31, 2025, we had a working capital deficit of approximately $1.6 million and an accumulated deficit of approximately $56.3 million. We expect to continue to incur significant operating losses for the foreseeable future as we continue the development of our diagnostic tests and advance our diagnostic tests through clinical trials.

Current wording

Prior to acquisition of the clinical pathology laboratory by PPLS, Village Oaks, under the trade name Precision Pathology Services, had licensed and developed CyPath® Lung as a laboratory developed test (“LDT”) for sale to physicians. The license agreement provided that revenues from the sale would be split evenly between the Company and Village Oaks. In the second quarter of 2022, prior to the acquisition, we started to recognize revenue as part of a limited beta market testing program of the CyPath®Lung test. We have never been profitable, and as of June 30, 2025, we had a working capital deficit of approximately $0.9 million and an accumulated deficit of approximately $60.4 million. We expect to continue to incur significant operating losses for the foreseeable future as we continue the development of our diagnostic tests and advance our diagnostic tests through clinical trials.

Previous wording

Net loss for the three months ended March 31, 2025, was approximately $2.7 million, compared to a net loss of approximately $2.0 million for the three months ended March 31, 2024.

Current wording

Net loss for the three months ended June 30, 2025, was approximately $4.1 million, compared to a net loss of approximately $2.1 million for the three months ended June 30, 2024.

Previous wording

1 Patient services fees include direct billing for CyPath® Lung diagnostic test of approximately $169,000 and $45,000 for the three months ended March 31, 2025 and 2024, respectively.

Current wording

1 Patient services fees include direct billing for CyPath® Lung diagnostic tests as well as anatomical tests and pathology services unrelated to CyPath® Lung including services discontinued due to unprofitability.

Previous wording

Operating expenses totaled approximately $4.5 million and $4.4 million for the three months ended March 31, 2025 and 2024, respectively. The increase in operating expenses is the result of the following factors:

Current wording

Operating expenses totaled approximately $3.8 million and $4.5 million during the three months ended June 30, 2025 and 2024, respectively. The decrease in operating expenses is the result of the following factors:

Previous wording

Our direct costs and expenses are primarily direct labor for pathology services, laboratory supplies and reagents, laboratory equipment, and allocated shared facilities. Direct costs and expenses totaled $1.4 million and $1.6 million during the three months ended March 31, 2025 and 2024, respectively. The decrease of approximately $206,000, or 13%, for 2025 compared to 2024 was primarily attributable to the targeted strategic actions which occurred in March 2025, aimed at streamlining operations and reducing costs related to our lab operations.

Current wording

Our direct costs and expenses are primarily direct labor for pathology services, laboratory supplies and reagents, laboratory equipment, and allocated shared facilities. Direct costs and expenses totaled $1.0 million and $1.4 million during the three months ended June 30, 2025 and 2024, respectively. The decrease of approximately $0.3 million for 2025 compared to 2024 was primarily attributable to the targeted strategic actions which occurred in March 2025, aimed at streamlining operations and reducing costs related to our lab operations.

Previous wording

Research and development expenses totaled approximately $367,000 and $394,000 for the three months ended March 31, 2025 and 2024, respectively. The decrease of $26,000, or 7%, for the three months ended March 31, 2025, compared to the same period in 2024 was primarily attributable to a decrease in compensation costs and benefits and lab supplies.

Current wording

Research and development expenses totaled approximately $311,000 and $402,000 for the three months ended June 30, 2025 and 2024, respectively. The decrease of approximately $91,000, or 23%, for the three months ended June 30, 2025, compared to the same period in 2024 was primarily attributable to a decrease in compensation costs and benefits and lab supplies.

Previous wording

Clinical development expenses totaled approximately $138,000 and $49,000 for the three months ended March 31, 2025 and 2024, respectively. The increase of $89,000, or 183%, for the three months ended March 31, 2025, compared to the same period in 2024 was primarily attributable to an increase in professional fees in 2025 related to managing our clinical strategy for our pivotal clinical trial.

Current wording

Clinical development expenses totaled approximately $129,000 and $51,000 for the three months ended June 30, 2025 and 2024, respectively. The increase of approximately $77,000, or 151%, for the three months ended June 30, 2025, compared to the same period in 2024 was primarily attributable to an increase in professional fees in 2025 related to managing our clinical strategy for our pivotal clinical trial.

Previous wording

Selling, general and administrative expenses totaled approximately $2.4 million and $2.2 million for the three months ended March 31, 2025 and 2024, respectively. The increase of approximately 267,000, or 12%, for the three months ended March 31, 2025, compared to the same period in 2024 was primarily attributable an increase in employee compensation related to administrative and sales due to additional personnel and support services to support the growth of sales of our diagnostic test, CyPath® Lung.

Current wording

Selling, general and administrative expenses totaled approximately $2.2 million and $2.5 million for the three months ended June 30, 2025 and 2024, respectively. The decrease of approximately $0.3 million, or 10%, for the three months ended June 30, 2025, compared to the same period in 2024 was primarily attributable a decrease in general and administrative costs related to lab operations as a result of our targeted strategic actions which occurred in March 2025, aimed at streamlining operations and reducing costs. These decreases were partially offset by an increase in employee compensation related to the addition of additional personnel and support services to support sales of our diagnostic test, CyPath® Lung.

Previous wording

We have incurred losses since our inception in 2014 as a result of significant expenditures for operations and research and development and, prior to April 2022, the lack of any approved diagnostic test or therapeutic products to generate revenue. For the three months ended March 31, 2025 and 2024, we had net losses of $2.7 million and $2.0 million, respectively, and we expect to incur substantial additional losses in future periods. We have an accumulated deficit of approximately $56.3 million as of March 31, 2025. Despite our recent financing in May 2025 in which we raised gross proceeds of $3.25 million, and our financing in February 2025, in which we raised gross proceeds of approximately $1.4 million, we believe our current cash and anticipated revenue from operations will be sufficient to support our operations through August 2025. Based on our current expected level of operating expenditures, current expected levels of revenue, and the cash and cash equivalents on hand at March 31, 2025, of $0.4 million, management concludes that there is substantial doubt about our ability to continue as a going concern for a period of at least twelve (12) months subsequent to the issuance of the accompanying unaudited condensed consolidated financial statements contained in this Quarterly Report. We need to raise further capital through the sale of additional equity or debt securities or other debt instruments, strategic relationships or grants, or through exercised outstanding warrants to support our future operations unless our revenue increases significantly. Our business plan includes expansion for our commercialization efforts which will require additional funding. If we are unable to improve our liquidity position, we may not be able to continue as a going concern. Our ability to continue as a going concern is dependent upon our ability to generate revenue and raise capital from financing transactions. There can be no assurance that we will be successful in accomplishing these objectives.

Current wording

We have incurred losses since our inception in 2014 as a result of significant expenditures for operations and research and development and, prior to April 2022, the lack of any approved diagnostic test or therapeutic products to generate revenue. For the six months ended June 30, 2025 and 2024, we had net losses of $6.7 million and $4.1 million, respectively, and we expect to incur substantial additional losses in future periods. We have an accumulated deficit of approximately $60.4 million as of June 30, 2025. Despite our recent financing in May 2025 in which we raised gross proceeds of $3.25 million, and our financing in February 2025, in which we raised gross proceeds of approximately $1.4 million, we believe our current cash and anticipated revenue from operations will not be sufficient to support our operations through August 2025. Based on our current expected level of operating expenditures, current expected levels of revenue, and the cash and cash equivalents on hand at June 30, 2025, of $0.8 million, management concludes that there is substantial doubt about our ability to continue as a going concern for a period of at least twelve (12) months subsequent to the issuance of the accompanying unaudited condensed consolidated financial statements contained in this Quarterly Report. We need to raise further capital through the sale of additional equity or debt securities or other debt instruments, strategic relationships or grants, or through exercised outstanding warrants to support our future operations unless our revenue increases significantly. Our business plan includes expansion for our commercialization efforts which will require additional funding. If we are unable to improve our liquidity position, we may not be able to continue as a going concern. Our ability to continue as a going concern is dependent upon our ability to generate revenue and raise capital from financing transactions. There can be no assurance that we will be successful in accomplishing these objectives.

Previous wording

Net cash used in operating activities was approximately $1.6 million and $2.3 million for the three months ended March 31, 2025 and 2024, respectively. The decrease of approximately $0.7 million in cash used by operations during the three months ended March 31, 2025, compared to the same period in 2024 was primarily attributable to an increase of approximately $660,000 in our loss from operations, a decrease in patient accounts receivables of approximately $487,000, offset by an increase in accounts payable and accrued expenses of approximately $863,000.

Current wording

Net cash used in operating activities was approximately $4.3 million and $3.9 million for the six months ended June 30, 2025 and 2024, respectively. The increase of approximately $0.4 million in cash used by operations during the six months ended June 30, 2025, compared to the same period in 2024 was primarily attributable to an increase of $2.6 million in our loss from operations, a decrease in accrued expenses by $$0.2 million offset by a decrease in accounts receivable by $1.5 million compared to the prior year, and a fair value adjustment to the warrant liability by $1.1 million related to the May 2025 warrant agreement.

Previous wording

We used approximately $51,000 for the three months ended March 31, 2025, in investing activities related primarily to the purchase of computer and laboratory equipment, compared to $41,000 used in investing activities for the three months ended March 31, 2024.

Current wording

We used approximately $64,000 for the six months ended June 30, 2025, in investing activities related primarily to purchase of computer and lab equipment, compared to approximately $70,000 used in investing activities for the six months ended June 30, 2024.

Previous wording

We enter into contracts in the normal course of business with third-party contract organizations for clinical trials and other services and products used for research and development and operating purposes. These contracts generally provide for termination following a certain period after notice, and therefore we believe that any non-cancelable obligations under these agreements are not material.

Current wording

We enter into contracts in the normal course of business with third-party contract organizations for clinical trials and other services and products used for research and development and operating purposes. These contracts generally provide for termination following a certain period after notice, and therefore we believe that any non-cancellable obligations under these agreements are not material.

Previous wording

We are governed by U.S. income tax laws, which are administered by the Internal Revenue Service (“IRS”). We follow ASC 740,Accounting for Income Taxes, which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and the reversal of deferred tax liabilities during the period in which the related temporary difference becomes deductible.

Current wording

We are governed by U.S. income tax laws, which are administered by the Internal Revenue Service. We follow ASC 740,Accounting for Income Taxes, which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and the reversal of deferred tax liabilities during the period in which the related temporary difference becomes deductible.