Creative Medical Technology Holdings, Inc.: Form 10-Q for the period ended Jun 30, 2026

Management’s Discussion and Analysis of Financial Condition and Results of Operations analyzes the major elements of our balance sheets and statements of operations. This section should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2025, and accompanying notes to these financial statements included in this report. All amounts are in U.S. dollars.

Forward-Looking Statement Notice

This quarterly report on Form 10-Q contains forward-looking statements about our expectations, beliefs or intentions regarding, among other things, our product development efforts, business, financial condition, results of operations, strategies or prospects. In addition, from time to time, we or our representatives have made or may make forward-looking statements, orally or in writing. Forward-looking statements can be identified by the use of forward-looking words such as “believe,” “expect,” “intend,” “plan,” “may,” “should” or “anticipate” or their negatives or other variations of these words or other comparable words or by the fact that these statements do not relate strictly to historical or current matters. These forward-looking statements may be included in, but are not limited to, various filings made by us with the SEC, press releases or oral statements made by or with the approval of one of our authorized executive officers. Forward-looking statements relate to anticipated or expected events, activities, trends or results as of the date they are made. Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties that could cause our actual results to differ materially from any future results expressed or implied by the forward-looking statements. Many factors could cause our actual activities or results to differ materially from the activities and results anticipated in forward-looking statements, including, but not limited to, those set forth in our most recent annual report referenced below.

This report identifies important factors which could cause our actual results to differ materially from those indicated by the forward-looking statements.

All forward-looking statements attributable to us or persons acting on our behalf speak only as of the date of this report and are expressly qualified in their entirety by the cautionary statements included in this report. We undertake no obligations to update or revise forward-looking statements to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. In evaluating forward-looking statements, you should consider these risks and uncertainties.

Overview

We are clinical-stage biotechnology company focused on developing regenerative medicine therapies derived from adult and perinatal stem cell technologies. We employ scalable, cGMP manufacturing that enables efficient, cost effective production as programs advance. Supported by a clinical, intellectual property and technological foundation, we are advancing from proof of concept into clinical development in pursuit of regenerative stem cell therapies across multiple indications, with a pipeline targeting addressable markets in orthopedics, immunotherapy, endocrinology, urology and gynecology. Out platforms and therapies include the following:

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Regenerative medicine refers to approaches that seek to repair, replace or restore damaged cells, tissues and organs rather than solely managing symptoms. These approaches are intended to harness or stimulate the body’s own healing processes. The goal is to regenerate functional tissue, such as rebuilding cartilage in an arthritic joint, improving heart muscle after a heart attack or restoring nerve function after injury, which may allow patients to recover more fully and potentially avoid or delay certain surgical interventions and long term drug therapy.

The Company utilizes three proprietary cell platforms – AlloStem™, ImmCelz™ and iPScelz™ – to pursue multiple therapeutic areas, which we believe broadens our market opportunity while diversifying development risk.

We have two U.S. Food and Drug Administration (FDA) cleared clinical trials in progress:

• CELZ 201 DDT (ADAPT trial), OlastrocelTM, for chronic lower back pain due to degenerative disc disease is a randomized Phase 1/2 study with FDA Fast Track designation.
• CELZ 201 (CREATE 1 trial) for new onset Type 1 diabetes, currently in Phase 1/2.

In addition, we have initiated the CELZ Biodefense Platform, a proprietary, artificial intelligence (AI) driven data and discovery initiative focused on evaluating, modelling and developing potential regenerative countermeasures for conditions associated with toxic environmental exposures, such as military burn pits.

We integrate AI, where applicable, into our drug development activities to analyse biological and clinical datasets, prioritize targets and candidates and support efforts to enhance efficiencies, shorten development timelines and increase the probability of success for our programs.

We operate with a lean, cross functional team and a network of strategic partners to advance our programs, including third-party manufacturers. We seek to allocate capital toward programs that we believe have clearer paths to differentiation, regulatory advancement and commercial or partnering potential.

Our lead clinical asset is CELZ 201 (Olastrocel™), which we are advancing toward Phase 3 development as a potential therapy for chronic lower back pain associated with degenerative disc disease. CELZ 201 also serves as the foundation for additional platform programs that we are currently pursuing.

Our cellular platforms are comprised of the following:

• AlloStem™: Our FDA cleared, off the shelf, donor derived perinatal tissue technology used in our regenerative programs. We have manufactured clinical grade cells under current Good Manufacturing Practice (cGMP) and believe AlloStem can be scaled across multiple indications. Our AlloStem line includes a Master Cell Bank and a Drug Master File, which helps de risk scale up and commercialization by supporting product consistency, safeguarding our IP, and streamlining future regulatory submissions for programs built on this platform.
• ImmCelz™: A personalized immunotherapy approach that reprograms a patient’s own immune cells with optimized free cell factors. These supercharged cells are then re-injected into the patient from whom they were extracted. This program is being evaluated for its potential to support regenerative and anti-immunomodulatroy effects. Our ImmCelz line is serving as the platform to develop therapies for heart disease and diabetes.
• iPScelz™: Our induced pluripotent stem cell (iPSC) platform, derived from AlloStem, intended to provide a renewable source for creating replacement cell types across a spectrum of degenerative diseases while evading immune rejection.

Regenerative Medicine Programs

Based on third party industry analyses, we believe the combined market opportunity for our targeted indications is approximately $10 billion. These analyses indicate potential long term growth driven by new therapies, expanded diagnostic rates and broader patient access. We may refine these estimates by indication as additional data become available.

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Olastrocel (CELZ 201) -

Olastrocel, also referred to as CELZ 201, is the Company’s lead allogeneic cell therapy candidate developed on the AlloStem™ platform.

In December 2025, the World Health Organization approved “Olastrocel” as the International Non Proprietary Name for the active cellular substance in CELZ 201. The INN is the globally standardized scientific name used by regulators, clinicians, researchers, and markets to identify a therapeutic substance across development and commercialization. This designation is a key global milestone, typically granted as a program moves into later regulatory stages and requires a unified international identity.

We are currently evaluating Olastrocel™ in our FDA-cleared ADAPT clinical trial for the treatment of chronic lower back associated with degenerative disc disease. This randomized Phase 1/2 study received FDA Fast Track designation in August 2025.

Previously reported interim blinded data showed improvements in disability and pain and did not identify serious adverse events or treatment related safety signals, as confirmed by an independent Data Safety Monitoring Board. In June 2026, the FDA cleared an expansion of the ADAPT trial to enroll an additional cohort of patients receiving less than 90 mg per day in morphine equivalents in order to further characterize safety and efficacy in individuals with ongoing opioid use.

Our near term priorities for Olastrocel™ include completing enrolment of the expanded ADAPT cohort, generating longer term follow up data, continuing regulatory interactions related to Phase 3 planning and evaluating potential strategic and partnering opportunities as the clinical dataset matures.

CELZ-201 is also being used in pre-clinical studies for managing abnormal glucose tolerance and preventing Type I Diabetes in high-risk individuals. This personalized medicine approach is believed to be a first in medical history.

Ultrasome™

Ultrasome™ is our proprietary cell free regenerative therapy program for osteoarthritis of the knee along with other indications and is derived from the CELZ 201 platform. We have reported pilot stage clinical data for Ultrasome™ that achieved the primary endpoint and demonstrated improvements in mobility and pain reduction without serious adverse events.

We believe Ultrasome™ may represent a regenerative approach for osteoarthritis in a large market where currently available therapies may provide only temporary relief. The Company’s near term priorities for the program include designing and initiating the next stage of clinical development, generating multi-center controlled data and evaluating regional, indication specific or broader strategic partnership opportunities intended to support development and commercial planning while seeking to limit dilutive capital needs.

CELZ Biodefense Platform: Project PHOENIX and Toxic Exposure Atlas™

Our CELZ Biodefense platform includes Project PHOENIX and the Toxic Exposure Atlas. The platform is designed to integrate exposure histories, clinical outcomes, multi omics datasets, cell response information and disease biology into a unified framework intended to support AI driven discovery and identification of potential regenerative countermeasures.

During 2026, the BioDefense Inc. Burn Pit Initiative received regulatory approval to proceed nationally. The program is being implemented through existing strategic alliances, infrastructure and vendor relationships. and is intended to operate without the need for new capital raises. In June 2026, Project PHOENIX advanced into a nationwide virtual data collection phase that is intended to scale to at least 1,000 veterans through a mobile app registry and field capable logistics.

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The Company’s near term priorities for the biodefense platform include completing initial enrollment and data ingestion for the first 1,000 veterans in the burn pit registry, advancing AI based modeling to identify exposure linked molecular signatures and potential regenerative countermeasures using the Company’s stem cell and induced pluripotent stem cell platforms and pursuing government and strategic collaborations intended to expand the potential utility of the Toxic Exposure Atlas across broader military and civilian populations.

Results of Operations – For the Three-month Periods Ended June 30, 2026, and 2025

Gross Revenue. No revenues were generated during the three-month periods ended June 30, 2026 and 2025.

Selling, General and Administrative Expenses. General and administrative expenses for the three-months ended June 30, 2026, totaled $1,080,045, in comparison with $731,517 for the comparable period a year ago. The increase of $348,528, or 48% is primarily due to increases of $206,642 in marketing due to a Company-level marketing campaign, $50,513 due to timing of a general liability payment, $38,244 increased salaries from an additional hire and $32,642 in additional travel expenses.

Amortization Expenses. Amortization expenses for the three-months ended June 30, 2026 totaled $22,918 in comparison with $30,742 for the comparable period a year ago.

Research and Development Expenses. Research and development expenses for the three-months ended June 30, 2026, totaled $459,200 in comparison to $501,261 for the comparable period a year ago. The decrease of $42,061, or 8% was primarily due to a decrease of $114,794 associated with the AlloStemSpine® Chronic Lower Back Pain (CELZ-201 ADAPT) trial as trial proceeds to the follow-up stage, offset by an $66,733 increase in general research and development associated with investments in our other platforms and programs.

Operating Loss. For the reasons stated above, our operating loss for the three-months ended June 30, 2026, was $1,562,163 in comparison with $1,263,520 for the comparable period a year ago.

Other Income. Other income for the three-months ended June 30, 2026, totaled $50,913 in comparison with $30,217 for the comparable period a year ago. The increased income of $20,696 is primarily due to higher short-term investment balances.

Net Income/Loss. For the reasons stated above, our net loss for the three-months ended June 30, 2026, was $1,511,250 in comparison with a net loss of $1,233,303 for the comparable period a year ago.

Results of Operations – For the Six-month Periods Ended June 30, 2026, and 2025

Gross Revenue. There were $0 and $3,000 revenues generated for the six-month periods ended June 30, 2026 and 2025 respectively.

Cost of Goods Sold. There were $0 and $1,200 cost of goods sold for the six-month periods ended June 30, 2026 and 2025 respectively.

Gross Profit/(Loss). There were $0 and $1,800 in gross profits for the six-month periods ended June 30, 2026 and 2025.

Selling, General and Administrative Expenses. General and administrative expenses for the six-months ended June 30, 2026, totaled $1,968,685, in comparison with $1,619,914 for the comparable period a year ago. The increase of $348,771, or 22% is primarily due to increases of $136,025 in marketing from a nation-wide, company-level marketing campaign, $114,971 in salaries due to an additional staff member and bonus payout timing, $51,000 in legal and accounting due to increased public filing activities, $30,214 in travel, and $26,923 in computer and internet expenses.

Amortization Expenses. Amortization expenses for the six-months ended June 30, 2026 totaled $51,773 in comparison with $61,319 for the comparable period a year ago.

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Research and Development Expenses. Research and development expenses for the six-months ended June 30, 2026, totaled $1,000,858 in comparison to $1,244,565 for the comparable period a year ago. The decrease of $243,707, or 20% was primarily due to a decrease of $163,594 in general research and development, and $89,112 associated with the AlloStemSpine® Chronic Lower Back Pain (CELZ-201 ADAPT) trial and it moves from subject recruitment/dosing to follow-up.

Operating Loss. For the reasons stated above, our operating loss for the six-months ended June 30, 2026, was $3,021,316 in comparison with $2,923,998 for the comparable period a year ago.

Other Income. Other income for the six-months ended June 30, 2026, totaled $106,349 in comparison with $52,598 for the comparable period a year ago. The increased income of $53,571 is primarily due to higher short-term investment balances.

Net Income/Loss. For the reasons stated above, our net loss for the six-months ended June 30, 2026, was $2,914,967 in comparison with a net loss of $2,871,400 for the comparable period a year ago.

Liquidity and Capital Resources

As of June 30, 2026, we had $8,714,115 of available cash and US Treasuries and positive working capital of approximately $8,320,318. In comparison, as of December 31, 2025, we had $7,208,126 of available cash, certificates of deposit and US Treasuries and positive working capital of $7,114,134.

Cash Flows

Net Cash used in Operating Activities. We used cash in our operating activities due to our losses from operations. Net cash used in operating activities was $2,795,555 for the six-months ended June 30, 2026, in comparison to $2,750,282 for the comparable period a year ago, an increase of $1,459 of 0.05%.

Net Cash used in Investing Activities. We used $175,000 in cash in investing activities during the six-months ended June 30, 2026, in comparison to no cash used for the comparable period a year ago. The increase in cash used in investing activities was related to a $125,000 investment in a related entity and a $50,000 investment in a note receivable.

Net Cash from Financing Activities.

Cash received in financing activities for the six-months ended June 30, 2026 was $4,476,544 in proceeds primarily from the June 30, 2026 warrant inducement transaction, in comparison to $3,354,000 in net cash received for the comparable period a year ago, primarily from the March 2025 warrant inducement transaction.

Critical Accounting Policies and Estimates

Our consolidated financial statements are prepared in accordance with generally accepted accounting principles accepted in the United States. In connection with the preparation of our financial statements, we are required to make assumptions and estimates about future events and apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses, and the related disclosures. We base our assumptions, estimates and judgments on historical experience, current trends, and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, we review the accounting policies, assumptions, estimates and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.

Evaluation of disclosure controls and procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 15(d)-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report were effective in ensuring that information required to be disclosed by us in reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and (ii) is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Changes in internal control over financial reporting

There were no changes in our internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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