BioCardia, Inc.: Form 10-Q for the period ended Jun 30, 2026

You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q. Some of the information contained in this discussion and analysis or set forth elsewhere in this Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the sections titled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in this Form 10-Q, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

We are a clinical-stage company developing cellular and cell-derived therapeutics for the treatment of cardiovascular and pulmonary diseases with significant unmet medical needs. Our CardiAMP® autologous mononuclear cell therapy platform is being advanced clinically for two cardiac clinical indications based on the mechanism of action of treating microvascular dysfunction demonstrated by these cells in preclinical studies of enhanced microvascular density and reduced fibrosis: ischemic heart failure with reduced ejection fraction (HFrEF) and refractory angina resulting from chronic myocardial ischemia (CMI). Our CardiALLO™ allogeneic mesenchymal stem cell (MSC) therapy platform is being advanced clinically as an “off the shelf” cell therapy based on the immunomodulatory mechanism of action for the treatment of ischemic inflammatory HFrEF. Our PulmALLO™ program for these same cells in the pulmonary indication of acute respiratory distress syndrome has had its investigational new drug (IND) approved by the U.S. Food and Drug Administration (FDA).

Our therapeutic candidates intended for cardiac indications are enabled by our Helix™ transendocardial biotherapeutic delivery catheters and our Morph™ DNA steerable introducers. We partner this therapeutic delivery platform and provide development services selectively with others seeking to develop biotherapeutic interventions for local delivery to the heart. We are developing Heart3D™ to enhance delivery for our investigational therapies and those of our partners.

To date, we have devoted substantially all of our resources to research and development efforts relating to our therapeutic candidates and biotherapeutic delivery systems, including conducting clinical trials, developing manufacturing and sales capabilities, in-licensing related intellectual property, providing general and administrative support for these operations and protecting our intellectual property. We have also generated modest revenues from sales of our approved products. We have funded our operations primarily through the sales of equity and convertible debt securities, and certain government and private grants.

CardiAMP Autologous Cell Therapy for Ischemic Heart Failure (BCDA-01)

The CardiAMP autologous cell therapy is a minimally processed mononuclear cell therapy containing CD34+ and CD133 cells and is designed to promote microvascular repair through enhanced capillary density and reduced fibrosis. The therapy is delivered during a standard minimally invasive catheter-based procedure utilizing the Helix biotherapeutic delivery system. Its lead indication is to treat ischemic heart failure of reduced ejection fraction (HFrEF). The CardiAMP Cell Therapy system has been granted Breakthrough Designation from the FDA and is reimbursed by Medicare.

Three clinical trials of the CardiAMP cell therapy for delivery have been completed with a fourth study actively enrolling. A fourth trial has been initiated to confirm the results observed in the CardiAMP HF Trial. In all trials, patients are typically discharged after an overnight stay.

• Our Phase 1, Transendocardial Autologous Bone Marrow in Myocardial Infarction Trial (TABMMI), National Clinical Trial (NTC) Identifier NCT-00507468, met its primary safety outcome and provided signals of patient benefit including improved exercise tolerance, improved heart function, reduced mortality. Results were published in the journal Eurointervention in 2011,
• Our Phase 2, Transendocardial Autologous Cells in Heart Failure Trial (TACHFT), NCT00768006, also met its primary safety outcome and provided signals of patient benefit when compared to the dedicated placebo group including improved six-minute walk distance, improved quality of life, and reduced major adverse cardiac events. Results for the dedicated placebo group were presented at the World Congress of Regenerative Medicine in 2015 and for the pooled placebo group were published in the Journal of the American Medical Association in 2014.
• Our Phase 3, CardiAMP Heart Failure Trial (CardiAMP HF), NCT02438306, was designed based on the Phase II TAC-HFT study to confirm signals of benefit observed relative to its dedicated placebo groups. The trial included biologically informed patient selection based on cell characteristics, point-of-care cell processing to maximize cell viability, targeted transendocardial delivery using the same innovative helical tipped catheter to boost cell retention and in-situ dose as in TAC-HFT and TABMMI, and long-term blinded contrast enhanced echocardiography assessment of ventricular remodeling. Clinical data from the 10-patient roll in cohort was published in 2021 in the International Journal of Cardiology. The randomized study cohort enrolled 115 patients across 28 centers in the United States, did not achieve its primary efficacy outcome, but met key secondary efficacy outcome in subgroup having elevated biomarkers of heart stress (NTproBNP). Results showed good safety with three treatment-emergent major adverse cardiac events (MACE) which were resolved without sequelae. Efficacy outcomes showed reduced mortality, reduced non-fatal MACE, and improved quality of life, which were statistically significant in the subgroup. Results also showed trends of improved heart function across all patients that were statistically significant in the subgroup. Principal results from the trial were presented at the Late-Breaking Clinical Trials symposium at the American College of Cardiology (ACC) Scientific Sessions in March 2025 with long term blinded core laboratory contrast enhanced echocardiography results showing enhanced heart function presented at the Late-Breaking Clinical Trials symposium at the Technology and Heart Failure Therapeutics (THT) meeting in March 2026.
• Our Phase 3 confirmatory CardiAMP Cell Therapy Heart Failure II Trial is a multi-center, randomized, double-blinded, sham-controlled study of up to 250 patients with NTproBNP levels >500 pg/ml at up to 40 centers in the United States. This confirmatory trial focuses on patients in active heart failure who demonstrated the greatest benefits in the interim results of the CardiAMP Heart Failure I Trial. The primary endpoint in the CardiAMP Heart Failure II Trial is an outcomes composite score based on a three-tiered Finkelstein-Schoenfeld hierarchical analysis. The tiers, starting with the most serious events, would be (1) all-cause death, including cardiac death equivalents such as heart transplant or left ventricular assist device placement, ordered by time to event; (2) non-fatal Major Adverse Coronary and Cerebrovascular Events (MACCE), excluding those deemed procedure-related occurring within the first seven days post-procedure (heart failure hospitalization, stroke or myocardial infarction), ordered by time to event, and (3) change from baseline in quality of life at a minimum of 12 months and a maximum of 24 months. Four clinical sites have enrolled in the study and are actively recruiting patients.

In May 2026, we announced that the Japan PMDA Consultation Record of Advice supports regulatory submission for approval of the CardiAMP Cell Therapy for Ischemic Heart Failure based on the Company’s three completed clinical trials of this therapy in HFrEF. PMDA’s Consultation Record confirms alignment on remaining questions to address before, and as part of the submission, for regulatory approval for ischemic HFrEF patients with elevated biomarkers of heart stress (NTproBNP) on stable guideline directed medical therapy (GDMT). PMDA noted that the positive outcomes seen in the trial were credible. It is estimated that 20,000 of the 300,000 patients in Japan would initially be eligible for this therapy. PMDA requested BioCardia demonstrate that enrolled patients were on GDMT and not eligible for revascularization procedures, required per CardiAMP HF protocol, and provide additional details for each incidence of all-cause death, heart transplantation or left ventricular assist device implantation.

In June 2026, we announced receipt of FDA minutes from its Q-Sub Meeting with FDA Center for Biologics Evaluation and Research (CBER) on the CardiAMP Cell Therapy System for the treatment of ischemic heart failure of reduced ejection fraction (HFrEF). The meeting minutes from FDA confirm that the ongoing CardiAMP Heart Failure II Trial may support Premarket Approval (PMA) for market clearance. PMA is the most rigorous type of device marketing application required by the agency. It is used to establish the safety and effectiveness of high-risk medical devices prior to them being approved for public use. FDA had previously indicated that they typically like to see two well designed trials for approval, particularly in large clinical indications such as HFrEF, where there are potentially over one million patients who could benefit from CardiAMP Cell Therapy in the United States. FDA has also previously demonstrated that they consider the CardiAMP Cell Therapy System safe, as this FDA determination is required to enable the Centers for Medicare and Medicaid to reimburse in the CardiAMP HF trials.

We are preparing clinical data sets for submission to Japan’s PMDA and the U.S. FDA. We are working with partners to complete the electronic trial master file, conduct good clinical practice audits, and structure clinical research data in accordance with CDISC Standards, which support data consistency, traceability, and regulatory compliance. We also expect to engage a Designated Marketing Authorization Holder, or DMAH, as the local regulatory representative required for foreign medical device and pharmaceutical companies seeking to sell products in Japan without establishing a local office. In Japan, the DMAH designation may be transferred together with the underlying product approval.

Catalysts ahead for this program include publication of the peer reviewed manuscript for CardiAMP HF, submission for approval in Japan, and ongoing enrollment in the CardiAMP HF II trial.

CardiAMP® Autologous Cell Therapy for Chronic Myocardial Ischemia (BCDA-02)

CardiAMP Cell Therapy system, under a second FDA approved investigational device exemption, is being studied in a second related clinical indication of chronic myocardial ischemia with refractory angina. This study is based on the strength of our Phase I and II ischemic heart failure trial data and previous clinical data on CD34+ mononuclear cells in this indication.

The CardiAMP Cell Therapy Chronic Myocardial Ischemia Trial is a Phase III, multi-center, randomized, double-blinded, placebo-controlled study of up to 343 patients at up to 40 clinical sites. The Phase III pivotal trial is designed to provide the primary support for the safety and efficacy of the CardiAMP Cell Therapy System for patients with no option chronic myocardial ischemia with refractory angina (BCDA-02). These patients experience frequent angina (i.e., chest pain) attacks that are uncontrolled by optimal drug therapy, and these patients are not suitable candidates for stent placement or bypass surgery, leaving them few therapeutic options.

In May 2026, primary results of this cohort were presented at Euro PCR, a world-leading course in interventional cardiovascular medicine. The presentation was made by Dr. Amish Raval, M.D., Professor of Medicine at University of Wisconsin School of Medicine and Public Health. Results presented by Dr. Raval, on behalf of the CardiAMP CMI Investigators, showed that the minimally invasive CardiAMP Cell Therapy procedure was well-tolerated with no treatment emergent major adverse cardiac events. Patients demonstrated positive clinical outcomes including increased exercise tolerance and reduced frequency of angina episodes with the autologous cell therapy up through 2 years follow-up. Prior to treatment, all patients were on guideline-directed medical therapy (GDMT) and had received all available percutaneous and/or surgical options as appropriate for their medical condition. Patients experienced increased exercise tolerance, improving by an average of 179 seconds, which persisted for the two-year study follow-up. Angina episodes were reduced by an average of 82% by six-months after treatment.

CardiALLO Allogeneic MSC for Ischemic Heart Failure with HFrEF (BCDA-03)

The Investigational New Drug application (IND) for a Phase 1/2 trial to deliver our allogeneic MSC for the treatment of HFrEF includes a 3+3 roll-in dose escalation cohort now followed by a 360-patient randomized double-blind controlled study based on a recent IND amendment to right size the study for nondilutive funding opportunities. The study utilizes the Finkelstein Schoenfeld three tier primary composite endpoint of mortality, MACCE, and functional capacity as measured by six-minute walk distance. The low dose cohort of 20 million cells has been completed and there have been no treatment-emergent adverse events, arrhythmias, rejection, or allergic response. The Data Safety Monitoring Board has recommended that the study proceed as designed based on the 30-day data safety assessment from this cohort.

We intend to fund development through nondilutive grants and partnering. With such funding, Phase 2 development is anticipated to be advanced in both the United States and Japan and would also enroll in approximately one year in the still active trial. It is expected that after the completion of this Phase 2 study that conditional approval in Japan may be pursued followed by a post-marketing study to further add to the evidence of safety and patient benefit.

Helix™ Biotherapeutic Delivery System

The Helix transendocardial biotherapeutic delivery system is a therapeutic-enabling platform for minimally invasive targeted delivery of biologic agents to the heart. Helix empowers a seamless transition from bench to commercialization for partners. Our biotherapeutic delivery partnerships are expected to enhance future treatment options for millions of people suffering from heart disease, offset the costs of biotherapeutic delivery for our own programs, and provide our investors with meaningful revenue sharing should our partnering efforts contribute to successful therapeutic development.

In February 2026, we announced a Pre-Submission to the FDA under its Q-Submission program for the approval of its Helix Transendocardial Delivery Catheter (Helix) for intramyocardial therapeutic and diagnostic agent delivery. In May 2026, BioCardia had this Pre-Submission meeting with FDA. FDA agreed that there are two pathways for Helix marketing clearance and raised no concerns on Helix safety data, device performance, or compatibility with general classes of agents. FDA’s preferred route of Helix approval was simultaneous with the approval of the CardiAMP cell therapy system for the treatment of heart failure. FDA also suggested a follow-on pre-submission incorporating agency advice could enable Helix approval via the DeNovo pathway.

Heart3D™ Fusion Imaging

The Heart3D system is expected to enhance real time two-dimensional X-ray imaging by fusing pre-procedure three-dimensional anatomical heart models created from high-quality MRI and CT images for the interventional cardiologist with a focus on cardiac biotherapeutic interventions and biopsies.

Heart3D is expected to be sold initially as a research tool with support services for partners in preclinical studies and subsequently approved for standard clinical practice. The software has performed well in simulated procedures in large animal models with ten intramyocardial injections in thirty minutes using single plane fluoroscopy. It is platform independent and expected to be able to work with most existing MR, CT, and fluoroscopy imaging systems.

Heart3D relies on our intellectual property around fusion imaging with a focus on cardiac biotherapeutic delivery and biopsy and that of our development and commercial partner CART-Tech, B.V., a Netherlands corporation, with whom we have entered into a development, license, and distribution agreement. BioCardia has exclusive licenses and distribution rights for biotherapeutic delivery world-wide and for cardiac biopsy in the United States.

On April 28, 2026, the Company announced the allowance of Japanese Patent, “Target Site Selection, Entry, and Update with Automatic Remote Image Annotation.” This patent adds further protection to BioCardia’s proprietary Heart3D™ Fusion Imaging (Heart3D) software intended for treatment planning and real-time navigation during CardiAMP Cell Therapy procedures. The allowed Japanese patent has claims on the use of Heart3D fusion imaging configured for transposing a preoperative three-dimensional image obtained by Computer Tomography (CT) or Magnetic Resonance Imaging (MRI) of the patient’s heart onto two orthogonal two-dimensional images to generate a combined three-dimensional model reconstruction of the heart on a display within or adjacent to a sterile field for navigating delivery systems and recording procedural locations.

Morph® DNA Steerable Introducers

All procedures using our Helix transendocardial delivery system include the use of a Morph steerable introducer. We have FDA market clearances for transseptal cardiac procedures, under the name AVANCE, and for aorto-ostial disease, including renal procedures, superior femoral artery procedures, below the knee procedures and mesenteric artery procedures, under the name Morph DNA. One of the device’s patented features is that its tendons are designed to enable deflection rotation around the catheter shaft, providing uniform bending in all directions and a substantial reduction of what is called catheter “whip.” This is designed to enhance physician control for many procedures. These FDA market clearances include a range of diameters and lengths for the devices.

Financial Overview

Research and Development Expenses

Our research and development expenses consist primarily of:

• salaries and related overhead expenses, which include share-based compensation and benefits for personnel in research and development functions;
• fees paid to consultants and contract research organizations, or CROs, including in connection with our preclinical studies and clinical trials and other related clinical trial fees, such as for investigator grants, patient screening, laboratory work, clinical trial management and statistical compilation and analysis;
• costs related to acquiring and manufacturing clinical trial materials;
• costs related to compliance with regulatory requirements; and
• payments related to licensed products and technologies.

We expense all research and development costs in the periods in which they are incurred. Costs for certain development activities are recognized based on an evaluation of the progress of completion of specific tasks using information and data provided to us by our vendors and clinical sites. Non-refundable advance payments for goods or services to be received in future periods for use in research and development activities are deferred and capitalized. The capitalized amounts are then expensed as the related goods are delivered and the services are received.

We plan to increase our research and development expenses as we continue the pivotal CardiAMP autologous cell therapy trials in heart failure and chronic myocardial ischemia, and begin our allogeneic cell therapy trials in heart failure and acute respiratory distress syndrome. We typically use our employee and infrastructure resources across multiple research and development programs, and accordingly, we have not historically allocated resources specifically to our individual programs. There are also significant synergies between these programs.

Selling, General and Administrative Expenses

Selling, general and administrative expenses consist primarily of salaries and related costs for employees in executive, finance and administration, sales, corporate development and administrative support functions, including share-based compensation expenses and benefits. Other selling, general and administrative expenses include sales commissions, rent, accounting and legal services, obtaining and maintaining patents, the cost of consultants, occupancy costs, insurance premiums and information systems costs.

Other Income (Expense)

Other income and expense consist primarily of interest income we earn on our cash and cash equivalents.

Critical Accounting Policies and Estimates

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which we have prepared in accordance with U.S. GAAP. The preparation of our financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities. We evaluate these estimates and judgments on an ongoing basis. We base our estimates on historical experience and on various judgements that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not clear from other sources. Actual results may differ from these estimates under different assumptions or conditions.

We define our critical accounting policies as those that require us to make subjective estimates and judgments about matters that are uncertain and are likely to have a material impact on our financial condition and results of operations as well as the specific manner in which we apply those principles. Our critical accounting policies are described in Item 7 in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 24, 2026, which is incorporated by reference herein.

Results of Operations

Comparison of Three and Six Months Ended June 30, 2026 and 2025

The following table shows our results of operations for the three and six months ended June 30, 2026 and 2025 (in thousands):

Research and Development Expenses. Research and development expenses decreased to $893,000 in the three months ended June 30, 2026 as compared to approximately $1.4 million in the three months ended June 30, 2025, and decreased to approximately $2.1 million in the six months ended June 30, 2026 as compared to approximately $2.9 million in the six months ended June 30, 2025 primarily due to closeout of the CardiAMP Heart Failure Trial, partially offset by early enrollment in the CardiAMP Heart Failure II Trial and regulatory activities to advance CardiAMP in Japan.

Selling, General and Administrative Expenses. Selling, general and administrative expenses remained relatively consistent at $730,000 in the three months ended June 30, 2026 as compared to $683,000 in the three months ended June 30, 2025, and approximately $1.8 million in the six months ended June 30, 2026 as compared to approximately $1.9 million in the six months ended June 30, 2025.

Liquidity and Capital Resources

We have incurred net losses each year since our inception and as of June 30, 2026, we had an accumulated deficit of approximately $172.2 million. We anticipate that we will continue to incur net losses for the next several years.

We have funded our operations principally through the sales of equity and convertible debt securities. On June 8, 2026, the Company announced the sale of 3,509,604 shares at an average price of $1.279 on Friday, June 5, 2026. The shares were sold pursuant to its “At The Market” offering agreement with H.C. Wainwright & Co., LLC. During the three months ended June 30, 2026, we sold 4,004,330 shares of common stock for gross proceeds of approximately $5.1 million. Currently there are no shares available for sale under the “At The Market” facility. As of June 30, 2026, we had cash and cash equivalents of approximately $4.1 million.

The following table shows a summary of our cash flows for the periods indicated (in thousands):

Cash Flows from Operating Activities. Cash flow from operating activities for any period is subject to many variables including the timing of cash receipts, payments to suppliers, and vendor payment terms. Cash flow used in operating activities increased to approximately $3.4 million during the six months ended June 30, 2026 as compared to approximately $3.3 million during the six months ended June 30, 2025, primarily due to the timing of payments to suppliers.

Cash Flows from Financing Activities. Net cash provided by financing activities of approximately $5.0 million and approximately $1.9 million during the six months ended June 30, 2026 and 2025, respectively, related primarily to proceeds from the sale of common stock, partially offset by payments of issuance costs.

April 2025 Financing - On April 22, 2025, we entered into a Securities Purchase and Registration Rights Agreement relating to a private placement with certain qualified institutional buyers and institutional accredited investors, as well as certain members of our board of directors and executive officers which closed on April 23, 2025 (the April 2025 Offering). Pursuant to the agreement, we sold 406,818 shares of our common stock, and warrants to purchase an aggregate of 406,818 shares of our common stock at an exercise price equal to $1.905 per share, which are exercisable at any time before the earlier of April 24, 2030 or the approval by the Japanese Pharmaceuticals and Medical Devices Agency of our application of our CardiAMP Cell Therapy System. The gross proceeds of the April 2025 Offering were $775,000, with associated issuance costs of $56,000.

June 2025 Financing - On June 30, 2025, we entered into a Securities Purchase and Registration Rights Agreement relating to a private placement with certain qualified institutional buyers and institutional accredited investors, as well as certain members of our board of directors and executive officers, which closed on June 30, 2025 (the June 2025 Offering). Pursuant to the agreement, we sold 274,696 shares of our common stock, and warrants to purchase an aggregate of 274,696 shares of our common stock at an exercise price equal to $1.95 per share, which are exercisable at any time before the earlier of June 30, 2030 or the approval by the Japanese Pharmaceuticals and Medical Devices Agency of our application of our CardiAMP Cell Therapy System. The gross proceeds of the June 2025 Offering were $570,000, with associated issuance costs of $9,000.

At-the-Market (ATM) Offerings – On December 6, 2023, we entered into an “At The Market” offering agreement (the Sales Agreement) with H.C. Wainwright & Co., LLC (HCW). Under the Sales Agreement, we may offer and sell our common stock, from time to time during the term of the Sales Agreement through or to HCW as sales agent or principal. We have filed a prospectus supplement (the ATM Prospectus Supplement), as supplemented, relating to the offer and sale of the shares pursuant to the Sales Agreement. The offering and sale of the shares were made pursuant to the Company’s previously filed and effective Registration Statement on Form S-3 (File No. 333-275099), which was initially filed with the Securities and Exchange Commission (the “SEC”) on October 19, 2023 and declared effective on December 5, 2023. As of August 11, 2026 and June 30, 2026, under the ATM Prospectus Supplement, we may issue up to $0 and $0 of our common stock, respectively. We have agreed to pay HCW a commission equal to 3% of the gross proceeds from the sales of shares and have agreed to provide HCW with customary indemnification and contribution rights.

Activity under the Sales Agreement was as follows (in thousands except share amounts):

Future Funding Requirements

To date, we have generated modest revenues. We do not know when, or if, we will generate any revenue from our development stage biotherapeutic programs. We do not expect to generate any revenue from sales of our autologous and allogeneic cell therapy candidates unless and until we obtain regulatory approval. At the same time, we expect our expenses to increase in connection with our ongoing development activities, particularly as we continue the research, development and clinical trials of, and seek regulatory approval for, our therapeutic candidates. In addition, subject to obtaining regulatory approval for any of our therapeutic candidates and companion diagnostic, we expect to incur significant commercialization expenses for product sales, marketing, manufacturing and distribution. We anticipate that we will need additional funding in connection with our continuing operations.

Based upon our current operating plan, we believe that the cash and cash equivalents of approximately $4.1 million as of June 30, 2026 are not sufficient to fund our planned expenditures and meet our obligations beyond January 2027. To continue development of our therapeutic candidates beyond such time, we plan to raise additional capital, potentially including non-dilutive collaboration and licensing arrangements, debt or equity financing, or a combination from these sources. We may be unsuccessful in raising funds from any or all such sources, and to the extent we raise any funds, they may be on highly dilutive terms. We have based our estimates on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect. Because of the numerous risks and uncertainties associated with the development and commercialization of our therapeutic candidates, we are unable to estimate the amounts of increased capital outlays and operating expenditures necessary to complete the development of our therapeutic candidates.

Our future capital requirements will depend on many factors, including:

• the progress, costs, results and timing of our autologous CardiAMP Cell Therapy System and allogeneic MSC clinical trials and related development programs;
• FDA acceptance of our autologous CardiAMP Cell Therapy System and allogeneic MSC therapies for heart failure and for other potential indications;
• the outcome, costs and timing of seeking and obtaining FDA and any other regulatory approvals;
• the costs associated with securing, establishing and maintaining commercialization and manufacturing capabilities;
• the number and characteristics of product candidates that we pursue, including our product candidates in preclinical development;
• the ability of our product candidates to progress through clinical development successfully;
• our need to expand our research and development activities;
• the costs of acquiring, licensing, or investing in businesses, products, product candidates and technologies;
• our ability to maintain, expand and defend the scope of our intellectual property portfolio, including the amount and timing of any payments we may be required to make, or that we may receive, in connection with the licensing, filing, prosecution, defense and enforcement of any patents or other intellectual property rights;
• the general and administrative expenses related to being a public company;
• our need and ability to hire additional management and scientific, medical and sales personnel;
• the effect of competing technological and market developments; and
• our need to implement additional internal systems and infrastructure, including financial and reporting systems.

Until such time that we can generate meaningful revenue from our recurring revenue biotherapeutic delivering partnering business model and/or sales of approved therapies and products, if ever, we expect to finance our operating activities through public or private equity or debt financings, government or other third-party funding, marketing and distribution arrangements, and other collaborations, strategic alliances and licensing arrangements or a combination of these approaches. To the extent that we are able to raise additional capital through the sale of equity or convertible debt securities, the ownership interests of our existing common stockholders may be highly diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our existing common stockholders. Debt financing, if available, may involve agreements that include conversion discounts or covenants limiting or restricting our ability to take specific actions, such as incurring debt, making capital expenditures or declaring dividends. If we raise additional funds through government or other third-party funding, marketing and distribution arrangements or other collaborations, or strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, products, or therapeutic candidates or to grant licenses on terms that may not be favorable to us.

We have prepared our condensed consolidated financial statements as of June 30, 2026 on the basis that we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. Due to the factors described above, there is substantial doubt about our ability to continue as a going concern within one year after the date these financial statements are issued. Our ability to continue as a going concern will depend, in a large part, on our ability to raise additional capital. If adequate funds are not available, we may be required to further reduce operating expenses, delay or reduce the scope of our product development programs, obtain funds through arrangements with others that may require us to relinquish rights to certain of our technologies or products that we would otherwise seek to develop or commercialize ourselves, or cease operations. While we believe in the viability of our strategy to raise additional funds, there can be no assurances that we will be able to obtain additional capital on acceptable terms and in the amounts necessary to fully fund our operating needs.

The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. If we are unable to continue as a going concern, we may be forced to liquidate assets. In such a scenario, the values received for assets in liquidation or dissolution could be significantly lower than the values reflected in our condensed consolidated financial statements.

Off-Balance Sheet Arrangements

During the periods presented, we did not have, nor do we currently have, any off-balance sheet arrangements as defined under the rules of the Securities and Exchange Commission.

Recent Accounting Pronouncements

See Note 2 of our notes to the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for information regarding recent accounting pronouncements that are of significance or potential significance to us.

There have been no material changes in our market risks during the three months ended June 30, 2026.

Our exposure to market risk is currently limited to our cash and cash equivalents, all of which have maturities of less than three months. The goals of our investment policy are preservation of capital, maintenance of liquidity needs, and fiduciary control of cash and investments. We also seek to maximize income from our investments without assuming significant risk or departing from our investment policy. We currently do not hedge interest rate exposure. Because of the short-term nature of our cash equivalents, we do not believe that an increase in market rates would have a material negative impact on the value of our portfolio.

Interest Rate Risk

As of June 30, 2026, based on current interest rates and total borrowings outstanding, a hypothetical 100 basis point increase or decrease in interest rates would have an immaterial pre-tax impact on our results of operations.

Foreign Currency Exchange Risks

We are a U.S. entity and our functional currency is the U.S. dollar. The vast majority of our revenues were derived from sales in the United States. We have business transactions in foreign currencies; however, we believe we do not have significant exposure to risk from changes in foreign currency exchange rates at this time. We do not currently engage in hedging or similar transactions to reduce our foreign currency risks. We will continue to monitor and evaluate our internal processes relating to foreign currency exchange, including the potential use of hedging strategies.

Evaluation of Disclosure Controls and Procedures

In connection with the preparation of this Quarterly Report on Form 10-Q, as of June 30, 2026, an evaluation was performed under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that, as of June 30, 2026, our disclosure controls and procedures were, in design and operation, effective at a reasonable assurance level.

Changes in Internal Control over Financial Reporting

There were no changes to our internal control over financial reporting identified in connection with the evaluation required by rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the three months ended June 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

In addition to the risk described below and the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2025, which could materially affect our business, financial condition, or future results, are incorporated by reference herein. The risks described in this report, our Annual Report on Form 10-K for the year ended December 31, 2025, and our Quarterly Reports on Form 10-Q filed periodically with the SEC are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect our business, financial condition or future results.

If we do not continue to satisfy the Nasdaq continued listing requirements, our securities could be delisted from the Nasdaq.

The listing of our common stock on the Nasdaq Capital Market (Nasdaq) is contingent on our compliance with the Nasdaq’s conditions for continued listing. We were previously not in compliance with the Nasdaq listing requirements. Although we have regained compliance, a future failure to maintain compliance with the Nasdaq’s continued listing requirements could result in our being subject to delisting by the Nasdaq. In the event our securities are no longer listed for trading on Nasdaq, our trading volume and security price may decrease and we may experience further difficulties in raising capital, which could materially affect our operations and financial results. Further, delisting from the Nasdaq could also have other negative effects, including potential loss of confidence by partners, lenders, suppliers and employees and could also trigger various defaults under our financing arrangements and other outstanding agreements.