What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-08-05 compared with 2024-05-14 · 577 added, 638 removed, 288 unchanged (81% of the section changed)

1 unchanged sentence

THERAPEUTICS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS

dollars in thousands, except for share and per share data)

Current assets:

Cash and cash equivalents

Other current assets

5 unchanged sentences

Intangible assets

LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

9 unchanged sentences

Stockholders’ (deficit) equity

Series A Preferred stock $ 0.0001 par value ( 20,000 shares designated) shares issued and outstanding at March 31, 2024 and December 31, 2023 were 1,215 and 1,417 , respectively (liquidation preference of $ 4.36 at March 31, 2024)

Common stock, $ 0.0001 par value ( 750,000,000 shares authorized, at March 31, 2024 and December 31, 2023);

shares issued and outstanding at March 31, 2024 and December 31, 2023 were 342,774 and 294,347 , respectively

Series A Preferred stock $ 0.0001 par value ( 20,000 shares designated) shares issued and outstanding at June 30, 2024 and December 31, 2023 were 0 and 1,417 , respectively

Common stock, $ 0.0001 par value ( 750,000,000 shares authorized, at June 30, 2024 and December 31, 2023);

shares issued and outstanding at June 30, 2024 and December 31, 2023 were 35,039,196 and 294,347 , respectively

Additional paid-in capital

1 unchanged sentence

Accumulated deficit

Total stockholders’ deficit

Total liabilities, preferred stock and stockholders’ (deficit) equity

Total stockholders’ equity (deficit)

Total liabilities and stockholders’ equity

accompanying notes to condensed consolidated financial statements.

THERAPEUTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

dollars in thousands, except for share and per share data)

Three months ended

Six months ended

Operating expenses:

6 unchanged sentences

Interest expense

Foreign exchange gains

Change in fair value adjustment of derivative and warrant liabilities

Foreign exchange (losses) gains

Change in fair value of derivative and warrant liabilities

Net other income

Net loss for the period before tax benefit

Net loss before tax benefit

Income tax benefit

Deemed dividend of 5% on Series C Convertible Preferred stock

Gain on extinguishment of Series A Convertible Preferred

Deemed dividend on Series A Convertible Preferred Stock

Gain on extinguishment of Series A Convertible Preferred Stock

Deemed dividend of 5 % on Series C Preferred Stock

Net loss attributable to common stockholders

7 unchanged sentences

THERAPEUTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES

IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)

the three months ended March 31, 2024 and 2023

CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE CONVERTIBLE STOCKHOLDERS’ EQUITY (DEFICIT)

the three and six months ended June 30, 2024 and 2023

dollars in thousands, except for share data)

Preferred Stock

Series A Preferred Stock Series B Preferred Stock Series C Convertible Preferred Stock Series A Preferred Stock Common Stock Additional

Paid in Accumulated

Comprehensive Accumulated Total

Stockholders’

Number Value Number Value Number Value Number Value Number Value Capital Loss Deficit (Deficit)

Balance, December 31, 2022 13,586 $ 2,001 190,786 $ 2 —

$ 83,158 $ ( 721 ) $ ( 82,550 ) $ ( 113 )

Issuance of Series C Convertible Preferred Stock, net — —

50,000 1,160 — —

Deemed dividend of 5 % and accretion of Series C Convertible Preferred Stock to redemption value — —

Round up of common shares issued as a result of 1-for-35 and 1-for-40 reverse stock splits — —

Conversion of Preferred Stock into common stock, net ( 3,838 ) ( 565 ) —

Redemption of Series B Preferred Stock ( 190,786 ) ( 2 ) — —

Stock based compensation (recoveries) — —

Currency translation adjustment — —

Loss for the period — —

( 3,352 ) ( 3,352 )

Balance, March 31, 2023 9,748 $ 1,436 —

50,000 $ 1,327 —

$ 83,437 $ ( 637 ) $ ( 85,902 ) $ ( 3,102 )

Stock Series C

Stock Series A

Stock Common Stock Additional

Paid in Accumulated

Comprehensive Accumulated Total

Stockholders’

Number Value Number Value Number Value Number Value Capital Loss Deficit (Deficit)

Issuance of common stock, net, April 2023 Financing — — — — — — 12,500 — 6,815 — — 6,815

Round up of common shares issued as a result of 1-for-40 reverse stock split — — — — — — 33 — — — — —

Fair value of April Warrants allocated to liabilities, net of financing costs — — — — — — — — ( 3,772 ) — — ( 3,772 )

Conversion of Series A Preferred Stock into common stock ( 5,509 ) ( 812 ) — — ( 2,705 ) ( 2,522 ) 11,210 — 3,334 — — 812

Deemed dividends on Series C Preferred Stock — — — 119 — — — — ( 119 ) — — ( 119 )

Elimination of Series A redemption rights ( 4,239 ) ( 624 ) 4,239 3,952 — — ( 3,328 ) — — 624

Issuance of Series A Preferred Stock as repayment of debt — — — — 486 453 — — — — — 453

Redemption of Series A Preferred Stock for cancellation of debt — — — — ( 1,550 ) ( 1,445 ) — — ( 207 ) — — ( 1,652 )

Exchange of Series C Preferred stock for Series A Preferred stock — — ( 50,000 ) ( 1,446 ) 5,577 5,199 — — ( 3,752 ) — — 1,447

Stock based compensation — — — — — — — — 180 — — 180

Currency translation adjustment — — — — — — — — — ( 29 ) — ( 29 )

Loss for the period — — — — — — — — — — ( 2,380 ) ( 2,380 )

Balance, June 30, 2023 — $ — — $ — 6,047 $ 5,637 25,228 $ — $ 82,588 $ ( 666 ) $ ( 88,282 ) $ ( 723 )

accompanying notes to condensed consolidated financial statements.

Preferred Stock

2 unchanged sentences

December 31, 2023

of Series C Convertible Preferred Stock, net

Deemed dividend of 5 % and accretion of Series C Convertible Preferred Stock to redemption value

Round up of common shares issued as a result of 1-for-35 and 1-for-40 reverse stock splits

of preferred stock into common stock, net

of Series B Preferred Stock

Extinguishment

of preferred stock

dividend on preferred stock

issued for compensation

of common shares, net

based compensation (recoveries)

2 unchanged sentences

March 31, 2024

accompanying notes to condensed consolidated financial statements.

Preferred Stock

Comprehensive

Stockholders’

Balance, December 31, 2023

Conversion of preferred stock into common stock, net

Extinguishment of preferred stock

Deemed dividend on preferred stock

Shares issued for compensation

Sale of common shares, net

Stock based compensation (recoveries)

Currency translation adjustment

Loss for the period

Balance, March 31, 2024

of preferred stock into common stock, net

Extinguishment

of preferred stock

dividend on preferred stock

exercise of 3i Exchange Warrants

of common shares, net

based compensation (recoveries)

translation adjustment

for the period

June 30, 2024

accompanying notes to condensed consolidated financial statements.

THERAPEUTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

CONSOLIDATED STATEMENTS OF CASH FLOWS

dollars in thousands)

Three months ended

Six months ended

CASH FLOWS FROM OPERATING ACTIVITIES:

3 unchanged sentences

Stock-based compensation (recoveries)

Unrealized foreign exchange gain

Non-cash finance expense

Unrealized foreign exchange (gains) losses

Non-cash financing cost

Non-cash interest

Change in fair value adjustment of warrant and derivative liabilities

Change in fair value of warrant and derivative liabilities

Deferred income taxes

9 unchanged sentences

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from convertible promissory notes and accrued interest, net

Net proceeds from sale of common shares

Proceeds from ATM sales of common stock, net of issuance costs

Net proceeds from sale of common stock and pre-funded warrant issuance

Proceeds from Series C Convertible Preferred Stock issuance, net of costs

Redemption of Series B Preferred Stock

Proceeds from 3i promissory notes

Repayment of 3i debt and promissory notes

Redemption of Series A Preferred Stock

Net cash provided by financing activities

Net decrease in cash

Net increase (decrease) in cash

Effect of exchange rate changes on cash

Cash, beginning of period

Cash, end of period

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

Supplemental information

2 unchanged sentences

Supplemental disclosure of non-cash investing and financing activities:

Conversion of Series A Convertible Preferred stock to equity, net

Deemed dividend on Series A Convertible Preferred Stock

Gain on extinguishment of Series A Convertible Preferred

Deemed 5% dividend on Series C Convertible Preferred Stock

Accretion of Series C Preferred shares to redemption value

Conversion of Series A Redeemable Preferred Stock

Deemed dividend on Series A Preferred Stock

Gain on extinguishment of Series A Preferred Stock

Stock issued in conjunction with consulting agreement

Issuance of 2,359,650 common shares on conversion of 3,632,366 3i Exchange Warrants

Issuance of 5,577 Series A Preferred Stock in exchange for Series C Preferred Stock

Issuance of Series A Preferred Stock to extinguish $ 350 3i Promissory Note

Deemed dividend on elimination of Series A redemption rights

Deemed dividend on exchange of Series C Preferred Stock for Series A Preferred Stock

Deemed dividend on Series C Convertible Preferred Stock, and accretion of Series C Preferred Stock to redemption value

accompanying notes to condensed consolidated financial statements.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

the three months ended March 31, 2024 and March 31, 2023

the six months ended June 30, 2024 and June 30, 2023

dollars in thousands, except for share and per share data and where otherwise noted)

5 unchanged sentences

in the research and development of anti-cancer drugs.

The Company’s principal

operations are located at Venlighedsvej 1, 2970 Horsholm, Denmark.

The Company’s business address in the Unites States is located

at 24 School Street, 2 nd Floor, Boston, MA 02108.

Company’s principal operations are located at Venlighedsvej 1, 2970 Horsholm, Denmark.

The Company’s business address in

the Unites States is located at 24 School Street, 2 nd Floor, Boston, MA 02108.

Reverse Stock Split

On April 9, 2024, the Company

effected a 1-for-20 reverse stock split of the shares of its Common Stock (the “Reverse Stock Split”).

All historical share

and per share amounts reflected throughout the Financial Statements (as defined below in 1(b)) and these notes to the financial statements

have been adjusted to reflect the Reverse Stock Split.

April 9, 2024, the Company effected a 1-for-20 reverse stock split of the shares of its Common Stock (the “Reverse Stock Split”).

All historical share and per share amounts reflected throughout the Financial Statements (as defined below in 1(b)) and these notes to

the financial statements have been adjusted to reflect the Reverse Stock Split.

See Note 9 (a).

Liquidity and Going Concern

The accompanying unaudited

condensed interim consolidated financial statements (the “Financial Statements”) have been prepared on the basis of continuity

of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business.

The Financial

Statements do not reflect any adjustments relating to the recoverability and reclassification of assets and liabilities that might be

necessary if the Company is unable to continue as a going concern.

Pursuant to the requirements

of Accounting Standard Codification (ASC) 205-40, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern,

management must evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s

ability to continue as a going concern within one year after the date that the financial statements are issued.

This evaluation initially

does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented as of

the date of the Financial Statements, and (1) is probable that the plan will be effectively implemented within one year after the

date the financial statements are issued, and (2) it is probable that the plan, when implemented, will mitigate the relevant condition

or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date

the financial statements are issued.

Certain elements of the Company’s operating plan to alleviate the conditions that raise substantial

doubt are outside of the Company’s control and cannot be included in management’s evaluation under the requirements of ASC

inception, the Company has devoted substantially all its efforts to business planning, research and development, clinical expenses, recruiting

management and technical staff, and securing funding via collaborations.

The Company has historically funded its operations with proceeds

received from its collaboration arrangements, sale of equity capital and proceeds from sales of convertible notes.

The Company has incurred significant

losses and has an accumulated deficit of $ 98.3 million as of March 31, 2024.

As of March 31, 2024, the Company’s cash of $ 312

is insufficient to fund the Company’s current operating plan and planned capital expenditures for the next 12 months.

These conditions

give rise to substantial doubt over the Company’s ability to continue as a going concern.

Management’s plans to

mitigate the conditions or events that raise substantial doubt include additional funding through public equity, private equity, debt

financing, collaboration partnerships or other sources.

On March 19, 2024, the Company entered into an At-The-Market Issuance

Sales Agreement with Ascendiant Capital Markets, LLC to sell shares of the Company’s Common Stock, with aggregate gross sales proceeds

of up to $ 22 million, from time to time, through an “at-the-market” equity offering program (the “ATM Offering”).

As of March 31, 2024, the Company has up to approximately $ 21.29 million remaining in aggregate gross proceeds that can be issued through the ATM

In light of the Company’s

cash position as of the date of this Quarterly Report, the Company does not have sufficient funds for its current operations and planned

capital expenditures.

As discussed above, the Company intends to seek capital through sale of its securities or other sources.

no assurances, however, that the Company will be successful in raising additional working capital, or if it is able to raise additional

working capital, it may be unable to do so on commercially favorable terms.

The Company’s failure to raise capital or enter into

other such capital raising arrangements if and when needed would have a negative impact on its business, results of operations and financial

condition and its ability to develop its product candidates.

Although management continues

to pursue its funding plans, there is no assurance that the Company will be successful in obtaining sufficient funding to fund continuing

operations on terms acceptable to the Company, if at all.

Accordingly, based upon cash on hand at March 31, 2024, the Company does not

have sufficient funds to finance its operations for at least twelve months from March 31, 2024 and therefore has concluded that substantial

doubt exists about the Company’s ability to continue as a going concern.

accompanying unaudited condensed interim consolidated financial statements (the “Financial Statements”) have been prepared

on the basis of continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course

to the requirements of Accounting Standard Codification (ASC) 205-40, Disclosure of Uncertainties about an Entity’s Ability to

Continue as a Going Concern, the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise

substantial doubt about the Company’s ability to continue as a going concern within one year after the date the accompanying unaudited

interim condensed consolidated financial statements were issued.

a biopharmaceutical organization, the Company has devoted substantially all of its resources since inception to research and development

activities for its Drug Response Predictor “DRP” in conjunction with product candidates, business planning, raising capital,

establishing its intellectual property portfolio, acquiring or discovering product candidates, and providing general and administrative

support for these operations.

As a result, the Company has incurred significant operating losses and negative cash flows from operations

since its inception and anticipates such losses and negative cash flows will continue for the foreseeable future.

Since inception the Company has

funded its operations primarily from sales of its stock.

The Company has incurred significant losses and has an accumulated deficit of

$ 99.9 million as of June 30, 2024.

To date the Company has not generated any significant revenues and expects to continue to generate

operating losses for the foreseeable future.

As of the issuance date of these unaudited interim condensed consolidated financial

statements, the Company expects that its existing cash and cash equivalents of $ 19.2 million as of June 30, 2024, will be sufficient

to fund its operating expenses and capital expenditure requirements for at least the next 12 months from the issuance date of these condensed

consolidated financial statements.

the Company believes its capital resources are sufficient to fund the Company’s on-going operations for the next 12 months from

the issuance date of these unaudited condensed consolidated financial statements, the Company’s liquidity could be materially affected

over this period by:

(1) its ability to raise additional capital through equity offerings, debt financings, or other non-dilutive third-party

(2) costs associated with new or existing strategic alliances, or licensing and collaboration arrangements;

(3) negative regulatory

events or unanticipated costs related to the DRP;

(4) any other unanticipated material negative events or costs.

One or more of these

events or costs could materially affect the Company’s liquidity.

If the Company is unable to meet its obligations when they become

due, the Company may have to delay expenditures, reduce the scope of its research and development programs, or make significant changes

to its operating plan.

The accompanying unaudited interim condensed consolidated financial statements do not include any adjustments

that might result from the outcome of this uncertainty.

Basis of Presentation

The Financial Statements have

been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

established by the Financial Accounting Standards Board (the “FASB”) for interim financial information and the rules and regulations

of the Securities and Exchange Commission (the “SEC”).

The Financial Statements contain

all normal and recurring adjustments necessary to state fairly the consolidated balance sheet, results of operations and comprehensive

loss, statements of changes in redeemable convertible preferred stock and stockholders’ equity (deficit), and cash flows of the

Company for the interim periods presented.

Except as otherwise disclosed, all such adjustments consist only of those of a normal recurring

Operating results for the three months ended March 31, 2024, are not necessarily indicative of the results that may be expected

for the current fiscal year ending December 31, 2024.

unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted

in the United States of America (“U.S.

GAAP”) as established by the Financial Accounting Standards Board (the “FASB”)

for interim financial information and the rules and regulations of the Securities and Exchange Commission (the “SEC”).

unaudited interim condensed consolidated financial statements contain all normal and recurring adjustments necessary to state fairly

the consolidated balance sheet, results of operations and comprehensive loss, statements of changes in redeemable convertible preferred

stock and stockholders’ equity (deficit), and cash flows of the Company for the interim periods presented.

Except as otherwise

disclosed, all such adjustments consist only of those of a normal recurring nature.

Operating results for the three and six months ended

June 30, 2024, are not necessarily indicative of the results that may be expected for the current fiscal year ending December 31, 2024.

The financial data presented herein do not include all disclosures required by U.S.

GAAP and should be read in conjunction with the audited consolidated financial statements and accompanying notes as of and for the fiscal

years ended December 31, 2023 and 2022, thereto included in the Company’s Annual Report on Form 10-K, as amended (the “Form

10-K”) initially filed with the SEC on March 8, 2024.

The preparation of the Financial

Statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets

and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods.

The results of operations and cash flows for the interim periods included in the Financial Statements are not necessarily indicative of

the results to be expected for any future period or the entire fiscal year.

(d) Risks and Uncertainties

The Company is subject to

risks common to companies in the biotechnology industry, including but not limited to, risks of failure of preclinical studies and clinical

trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the need to successfully

commercialize and gain market acceptance of its product candidates, dependence on key personnel and collaboration partners, protection

of proprietary technology, compliance with government regulations, development by competitors of technological innovations, and the ability

to secure additional capital to fund operations.

Product candidates currently under development will require significant additional research

and development efforts, including preclinical and clinical testing and regulatory approval prior to commercialization.

Even if the Company’s

research and development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product

Summary of Significant Accounting Policies

have been no new or material changes to the significant accounting policies discussed in the Form 10-K, that are of significance, or

potential significance, to the Company.

GAAP and should be read in conjunction with the audited

consolidated financial statements and accompanying notes as of and for the fiscal years ended December 31, 2023 and 2022, thereto included

in the Company’s Annual Report on Form 10-K, as amended (the “Form 10-K”) initially filed with the SEC on March 8,

preparation of unaudited interim condensed consolidated financial statements in conformity with U.S.

GAAP requires management to make

estimates and assumptions that affect the reported amount of assets and disclosure of contingent assets and liabilities at the date of

the unaudited interim condensed consolidated financial statements and the reported amounts of revenue and expenses during the reported

Actual results could differ from these estimates and assumptions.

Risks and Uncertainties

Company is subject to risks common to companies in the biotechnology industry, including but not limited to, risks of failure of preclinical

studies and clinical trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the

need to successfully commercialize and gain market acceptance of its product candidates, dependence on key personnel and collaboration

partners, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations,

and the ability to secure additional capital to fund operations.

Product candidates currently under development will require significant

additional research and development efforts, including preclinical and clinical testing and regulatory approval prior to commercialization.

Even if the Company’s research and development efforts are successful, it is uncertain when, if ever, the Company will realize

significant revenue from product sales.

of Significant Accounting Policies

have been no new or material changes to the significant accounting policies discussed in the Company’s Annual Report on Form 10-K

for the year ended December 31, 2023, that are of significance, or potential significance, to the Company.

Organization and Principles of Consolidation

The financial statements include

the accounts of the Company and its wholly owned subsidiaries:

Country of Incorporation

financial statements include the accounts of the Company and its wholly owned subsidiaries:

Name Country of Incorporation

Allarity Acquisition Subsidiary Inc.

United States

Allarity Therapeutics Europe ApS (formerly Oncology Venture Product Development ApS)*

Allarity Therapeutics Denmark ApS (formerly OV-SPV2 ApS)*

MPI Inc.* (1)

United States

Allarity Therapeutics Europe ApS (formerly Oncology Venture Product Development ApS)* Denmark

Allarity Therapeutics Denmark ApS (formerly OV-SPV2 ApS)* Denmark

MPI Inc.* (1) United States

* Wholly-owned subsidiary of Allarity Acquisition Subsidiary, Inc.

the process of being dissolved because inactive.

All intercompany transactions

and balances, including unrealized profits from intercompany sales, have been eliminated upon consolidation.

Use of Estimates and Assumptions

The preparation of financial

statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets

and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts

of revenues and expenses during the reporting years.

Significant estimates and assumptions reflected in the Financial Statements include,

but are not limited to, the fair value of the Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, warrants,

convertible debt, convertible promissory note, and the accrual for research and development expenses, fair values of acquired intangible

assets and impairment review of those assets, share based compensation expense, and income tax uncertainties and valuation allowances.

The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes

to be reasonable under the circumstances.

Estimates are periodically reviewed considering reasonable changes in circumstances, facts,

and experience.

Changes in estimates are recorded in the period in which they become known and if material, their effects are disclosed

in the notes to the financial statements.

Actual results could differ from those estimates or assumptions.

(1) In the process of being dissolved because inactive.

intercompany transactions and balances, including unrealized profits from intercompany sales, have been eliminated upon consolidation.

Foreign currency and currency translation

10 unchanged sentences

Unrealized translation gains and losses are recorded as a cumulative translation adjustment,

which is included in the condensed consolidated statements of changes in redeemable convertible preferred stock and stockholders’

equity (deficit) as a component of accumulated other comprehensive loss.

which is included in the condensed consolidated statements of changes in stockholders’ equity (deficit) as a component of accumulated

other comprehensive loss.

assets and liabilities denominated in currencies other than the functional currency are remeasured into the functional currency at rates

8 unchanged sentences

comprehensive loss as incurred.

The Company recorded a foreign exchange translation gain of $ 25 and $ 84 , included in accumulated other

comprehensive loss for the three month periods ended March 31, 2024 and 2023, respectively.

During the three months ended June 30, 2024 and 2023, the Company recorded accumulated foreign currency

translation losses of ($ 144 ) and ($ 29 ), respectively.

During the six months ended June 30, 2024 and 2023, the Company recorded accumulated

foreign currency translation gains / (losses) of ($ 119 ) and $ 55 , respectively.

Concentrations of credit risk and of significant suppliers

instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash.

The Company maintains its

cash in financial institutions in amounts that could exceed government-insured limits.

The Company does not believe it is subject to

additional credit risks beyond those normally associated with commercial banking relationships.

The Company has not experienced losses

on its cash accounts and management believes, based upon the quality of the financial institutions, that the credit risk regarding these

deposits is not significant.

The Company is dependent on third-party manufacturers to supply products for research and development

activities in its programs.

In particular, the Company relies and expects to continue to rely on a small number of manufacturers to supply

its requirements for supplies and raw materials related to these programs.

These programs could be adversely affected by a significant

interruption in these manufacturing services or the availability of raw materials.

Cash consists primarily of

highly liquid investments with original maturities of three months or less at date of purchase to be cash equivalents.

(f) Accumulated

other comprehensive loss

Accumulated other comprehensive

loss includes net loss as well as other changes in stockholders’ equity (deficit) that result from transactions and economic events

other than those with shareholders.

The Company records unrealized gains and losses related to foreign currency translation and instrument

specific credit risk as components of other accumulated comprehensive loss in the condensed consolidated statements of operations and

comprehensive loss.

During the three months ended March 31, 2024, and 2023, the Company’s other comprehensive gain was comprised

of currency translation adjustments.

Contingencies

for loss contingencies arising from claims, assessments, litigation, fines, penalties, and other sources are recorded when it is probable

that a liability has been incurred and the amount can be reasonably estimated.

At each reporting date, the Company evaluates whether

a potential loss amount or a potential loss range is probable and reasonably estimable under the provisions of the authoritative guidelines

that address accounting for contingencies.

The Company expenses costs as incurred in relation to such legal proceedings as general and

administrative expense within the condensed consolidated statements of operations and comprehensive loss.

(h) Reclassification

the three months ended March 31, 2023, we have reclassified financing costs of $ 9 from other income and expenses to general and

administrative expenses with no net impact upon our operating results or cash flows for either the current or prior periods.

instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents.

Company maintains its cash and cash equivalents in financial institutions in amounts that could exceed government-insured limits.

Company does not believe it is subject to additional credit risks beyond those normally associated with commercial banking relationships.

The Company has not experienced losses on its cash and cash equivalents accounts and management believes, based upon the quality of the

financial institutions, that the credit risk regarding these deposits is not significant.

The Company is dependent on third-party

manufacturers to supply products for research and development activities in its programs.

In particular, the Company relies and expects

to continue to rely on a small number of manufacturers to supply its requirements for supplies and raw materials related to these programs.

These programs could be adversely affected by a significant interruption in these manufacturing services or the availability of raw materials.

Cash and cash equivalents

Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

maintains deposits primarily in financial institutions, which may at times exceed amounts covered by insurance provided by the U.S.

Deposit Insurance Corporation (“FDIC”).

The Company has not experienced any losses related to amounts in excess of FDIC limits.

Accumulated other comprehensive loss

other comprehensive loss includes net loss as well as other changes in stockholders’ equity (deficit) that result from transactions

and economic events other than those with shareholders.

The Company records unrealized gains and losses related to foreign currency translation

and instrument specific credit risk as components of other accumulated comprehensive loss in the condensed consolidated statements of

operations and comprehensive loss.

During the three and six months ended June 30, 2024, and 2023, the Company’s other comprehensive

gain was comprised of currency translation adjustments.

Reclassification

the six months ended June 30, 2023, we have reclassified financing costs of $ 9 from other income and expenses to general and administrative

expenses with no net impact upon our operating results or cash flows for either the current or prior periods.

Recently Issued Accounting Pronouncements

Changes to U.S.

GAAP are established

by the FASB in the form of accounting standards updates (“ASUs”) to the FASB’s Accounting Standards Codification.

Company considers the applicability and impact of all ASUs.

All other ASUs issued through the date of the Financial Statements were assessed

and determined not to be applicable or are expected to have minimal impact on the Company’s condensed consolidated financial position

and results of operations.

GAAP are established by the FASB in the form of accounting standards updates (“ASUs”) to the FASB’s Accounting

Standards Codification.

The Company considers the applicability and impact of all ASUs.

All ASUs issued through the date of the Financial

Statements were assessed and determined not to be applicable or are expected to have minimal impact on the Company’s condensed

consolidated financial position and results of operations.

Intangible assets

During the three months ended

March 31, 2024, because of continuing downward pressure on the Company’s shares of Common Stock, the Company performed an impairment

assessment with a WACC of 26 % and determined that no further impairment of the Company’s intangible assets is required as of March

The Company’s IPR&D

assets have been classified as indefinite-lived intangible assets.

The Company’s individual material development project in progress,

Stenoparib, is recorded at $ 9,656 and $ 9,871 on March 31, 2024, and December 31, 2023, respectively.

the six months ended June 30, 2024, because no impairment indicators were identified no impairment analysis was performed at June 30,

Company’s IPR&D assets have been classified as indefinite-lived intangible assets.

The Company’s individual material

development project in progress, Stenoparib, is recorded at $ 9,557 and $ 9,871 on June 30, 2024, and December 31, 2023, respectively.

Accrued liabilities

5 unchanged sentences

Accrued consulting fees

Accrued Board member and scientific advisory fees

Convertible promissory note due to Novartis

On January 26, 2024, we received

a termination notice from Novartis Pharma AG, a company organized under the laws of Switzerland (“Novartis”) due to a material

breach of that certain license agreement dated April 6, 2018, as amended to date (the “License Agreement”).

under the terms of the License Agreement, the Company ceased all development and commercialization activities with respect to all licensed

products, all rights and licenses granted by Novartis to the Company reverted to Novartis;

and all liabilities due to Novartis became

immediately due and payable inclusive of interest which is continuing to accrue at 5% per annum.

As of March 31, 2024, the liability

is recorded as a current liability on the Company’s condensed unaudited consolidated balance sheets as follows:

$ 3,600 in accounts

payable, $ 1,317 convertible promissory notes and accrued interest, net of debt discount, and $ 147 in accrued liabilities.

January 26, 2024, we received a termination notice from Novartis Pharma AG, a company organized under the laws of Switzerland (“Novartis”)

due to a material breach of that certain license agreement dated April 6, 2018, as amended to date (the “License Agreement”).

Accordingly, under the terms of the License Agreement, the Company ceased all development and commercialization activities with respect

to all licensed products, all rights and licenses granted by Novartis to the Company reverted to Novartis;

and all liabilities due to

Novartis became immediately due and payable inclusive of interest which is continuing to accrue at 5 % per annum.

As of June 30, 2024,

the liability is recorded as a current liability on the Company’s condensed unaudited consolidated balance sheets as follows:

in accounts payable, $ 1,325 convertible promissory notes and accrued interest, net of debt discount, and $ 192 in accrued liabilities.

Convertible senior promissory notes due to 3i, LP (3i”)

Convertible Senior Promissory Notes (2024) (collectively the “2024 Notes”)

During the three months ended

March 31, 2024, the Company entered into a Securities Purchase Agreement (the “SPA”), as amended, with 3i, pursuant to which

three senior convertible promissory notes were issued as follows:

On January 18, 2024, in an aggregate principal amount of $ 440 due on

January 18, 2025, and with a set conversion price of $ 8.95 per share, for an aggregate purchase price of $ 400 , representing an approximate

10 % original issue discount (the “First Note”).

3i Convertible Senior

Promissory Notes (2024) (collectively the “2024 Notes”)

the three months ended March 31, 2024, the Company entered into a Securities Purchase Agreement (the “SPA”), as amended,

with 3i, pursuant to which three senior convertible promissory notes were issued as follows:

On January 18, 2024, in an aggregate principal amount of $ 440 due on January 18, 2025, and with a set conversion price of $ 8.95 per share, for an aggregate purchase price of $ 400 , representing an approximate 10 % original issue discount (the “First Note”).

On February 13, 2024, in an aggregate principal amount of $ 440 due on February 13, 2025, and with a set conversion price of $ 8.10 per share, for an aggregate purchase price of $ 400 , representing an approximately 10 % original issue discount (the “Second Note”).

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Notes without 3i’s prior written consent.

Company evaluated the terms of the 2024 Notes as required pursuant to ASC 570, 480, 815 and ASU 2020-06, and concluded the 2024 Notes

will be recorded at $ 1,340 , net of share issuance costs of $ 40 ,

and accreted to redemption value of $ 440 on January 18, 2025, $ 440 on February 13, 2025, and $ 660 on March 14, 2025, using the effective

interest method.

The total debt discount of $ 140 and costs of $ 60 of the 2024 Notes are being amortized to interest expense over the one

year term of each tranche of the debt.

As of March 31, 2024, we have recorded $ 37 as interest expense.

The balance outstanding at

March 31, 2024 is $ 1,377 .

See Note 17(a) iii.

The Company agreed to pay

interest to 3i on the aggregate unconverted and then outstanding principal amount of the 2024 Notes at the rate of 8 % per annum with interest

payments commencing one month after the initial receipt of net proceeds.

The interest on each of the 2024 Notes is payable in cash or,

at the 3i’s option, in shares of our Common Stock, at the 90 % of the lowest VWAP during the previous ten trading days that is immediately

prior to the interest payment dates.

Under the terms of the 2024 Notes, 3i has the exclusive right to choose whether to receive interest

payments in cash or as shares of our Common Stock.

Conversion of the 2024 Notes

Company has committed to keeping enough of its authorized but unissued shares of Common Stock available exclusively for conversion of

the 2024 Notes.

The number of shares to be issued upon conversion of the 2024 Notes will be calculated by dividing the outstanding principal

amount of the respective 2024 Notes to be converted by their respective conversion prices as described above.

The conversion prices of

the 2024 Notes are subject to adjustment to equal the price of subsequent equity sales.

3i’s ownership percentage of our shares

of Common Stock is limited to no more than 4.99 %, as determined according to Section 13(d) of the Securities Exchange Act of 1934, as

amended (the “Exchange Act”), and its accompanying rules.

Additionally, the Company cannot issue shares of its Common Stock

in relation to the 2024 Notes transaction, including shares due upon the 2024 Notes conversion or otherwise, that exceed 19.99 % of its

total outstanding shares of Common Stock, unless otherwise permitted by the 2024 Notes and related documents.

Subject to the provisions

of the 2024 Notes, if, at any time while the 2024 Notes are outstanding, the Company engages in one or more subsequent financings, 3i

may require us to first use up to 100 % of the gross proceeds of such financing to redeem all or a portion of the 2024 Notes at 105 %.

if the Company were to raise capital in the ATM Offering, 3i may request up to 20 % of the proceeds to redeem the Series A Convertible

Preferred Stock (the “Series A Preferred Stock”) at the stated value.

The 2024 Notes include customary

event of default provisions and provide for a mandatory default provision.

Upon the occurrence of an event of default, 3i may require

the Company to pay in cash the “Mandatory Default Amount” which is defined in the 2024 Notes to mean the sum of (a) the greater

of (i) the outstanding principal amount of the First Note, the Second Note and the Third Note, plus all accrued and unpaid interest thereon,

divided by the lesser of (i) $ 8.95 in the case of the First Note, $ 8.10 in the case of the Second Note, and $ 7.00 in the case of the Third

Note, or (ii) 85 % of the average of the three lowest VWAPs during the 10 trading days ending on the trading day that is immediately prior

to the applicable date the Mandatory Default Amount is either (A) demanded or otherwise due or (B) paid in full, whichever has a lower

conversion price, multiplied by the highest closing price for the Company’s shares of Common Stock on the trading market during

the period beginning on the date of first occurrence of the event of default and ending on the date the Mandatory Default Amount is paid

in full, or (ii) 130 % of the sum of the outstanding principal amount of the First and Second Note, plus accrued and unpaid interest hereon,

and (b) all other amounts, costs, expenses and liquidated damages due in respect of the First Note, the Second Note and the Third Note.

Negative Covenants

any of the 2024 Notes are outstanding, without prior written consent from 3i and holders of at least 50.01 % of the outstanding 2024 Notes,

the Company is restricted from (i) incurring any debt exceeding $ 250 in total;

(ii) creating any liens on their property, except for permitted

(iii) making amendments to their charter documents that adversely affect 3i’s rights;

(iv) repurchasing the Company’s

shares of Common Stock or equivalents, except under specific conditions related to conversion shares under the Second Note and equity

incentives for departing officers and directors, capped at $ 50 in total;

(v) repurchasing or acquiring any indebtedness other than the

First Note and the Second Note, unless it is done pro-rata;

(vi) paying cash dividends or distributions on their equity securities;

engaging in transactions with any affiliates or related parties, unless permitted by the SPA;

and (viii) entering into agreements related

to the above restrictions.

Registration Rights

Company agreed to register with the SEC the resale of its shares of the Common Stock issuable upon conversion of the 2024 Notes pursuant

We agreed to reimburse 3i of reasonable attorneys’ fees and expenses incurred by 3i for significant work in connection

with the closings contemplated in the SPA.

The SPA also provides for indemnification of 3i if it incurs losses, liabilities, obligations,

claims, contingencies, damages, costs and expenses related to, among other things, a breach by us of any of our representations, warranties

or covenants under the SPA.

3i Convertible Secured Promissory Notes (2023)

Company agreed to pay interest to 3i on the aggregate unconverted and then outstanding principal amount of the 2024 Notes at the rate

of 8 % per annum with interest payments commencing one month after the initial receipt of net proceeds.

The interest on each of the 2024

Notes is payable in cash or, at the 3i’s option, in shares of our Common Stock, at 90 % of the lowest VWAP during the previous ten

trading days that is immediately prior to the interest payment dates.

Under the terms of the 2024 Notes, 3i has the exclusive right to

choose whether to receive interest payments in cash or as shares of our Common Stock.

to the provisions of the 2024 Notes, if, at any time while the 2024 Notes are outstanding, the Company engages in one or more subsequent

financings, 3i may require us to first use up to 100 % of the gross proceeds of such financing to redeem all or a portion of the 2024

Notes at 105 %.

However, if the Company were to raise capital in the ATM Offering, 3i may request up to 20 % of the proceeds to redeem

the Series A Convertible Preferred Stock (the “Series A Preferred Stock”) at the stated value.

2024 Notes and accrued interest were redeemed in full and cancelled on May 6, 2024.

3i Convertible Secured

Promissory Notes (2023)

November 22, 2022, the Company entered into a Secured Note Purchase Agreement (“Purchase Agreement”) with 3i, whereby the

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in exchange for cash.

Effective December 30, 2022, the Company issued an additional Note in the principal amount of $ 650 in exchange for

Effective December 30, 2022, the Company issued an additional Note in the principal amount of $ 650 in exchange

Note matured on January 1, 2024 , carried an interest rate of 5 % per annum, and was secured by all of the Company’s assets pursuant

9 unchanged sentences

are included in the carrying value of the Notes and amortized to interest expense over the contractual term of the underlying debt.

2022, the Company recorded a $ 34 debt discount upon issuance of the Notes related to legal fees paid that were capitalized as debt issuance

For the three months ended March 31, 2023, interest expense totaled $ 43 , comprised of $ 33 for contractual interest and $ 10 for

the amortization of the debt discount.

Company recorded a $ 34 debt discount upon issuance of the Notes related to legal fees paid that were capitalized as debt issuance costs.

For the six months ended June 30, 2023, interest expense totaled $ 43 , comprised of $ 33 for contractual interest and $ 10 for the amortization

of the debt discount.

3i Convertible Secured Promissory Notes were paid in full and cancelled on April 21, 2023.

Preferred Stock

A Convertible Preferred Stock and Common Stock Purchase Warrants

Series A Convertible Preferred Stock and Common

Stock Purchase Warrants

Amendments to Series A Convertible Preferred Stock

Determination

of Conversion Price Adjustments for Series A Preferred Stock

Determination of Conversion

Price Adjustments for Series A Preferred Stock

December 9, 2022, the Company and 3i entered into a letter agreement (the “2022 Letter Agreement”) which provided that pursuant

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to Conversion Price of Series A Preferred Stock and 3i Exchange Warrants

On January 14, 2024, pursuant

to the terms of the First Note, the Company modified the conversion price of the 3i Exchange Warrants from $ 20.00 to $ 8.95 , thereby increasing

the number of Exchange Warrants outstanding from 220,361 at December 31, 2023 to 492,317 outstanding at January 14, 2024.

Also on January 14,

2024, the conversion price of the outstanding 1,417 shares of Series A Preferred Stock was revised from $ 20.00 to $ 8.95 .

The Company filed

the Fifth Certificate of Amendment to Amended and Restated COD (the “Fifth Amendment”) with the Secretary of State of the

State of Delaware to reflect the new conversion price of the Series A Preferred Stock of $ 8.95 .

As of January 14, 2024, the Company used

the Black-Scholes option pricing model to determine the fair value of the 1,417 Series A Preferred Stock outstanding at $ 1,970 versus

their carrying value of $ 1,742 .

Accordingly, the Company has recorded a deemed dividend of $ 228 as at January 14, 2024.

At a stated value

of $ 1,080 for each share of Series A Preferred Stock, the revised price of $ 8.95 per share results in the 1,417 shares being convertible

into 170,952 shares of Common Stock as of January 14, 2024.

On February 13, 2024, pursuant

to the terms of the Second Note, the Company modified the conversion price of the 3i Exchange Warrants from $ 8.95 to $ 8.10 and thereby

increased the number of Exchange Warrants outstanding from 492,317 on January 18, 2024, to 544,101 on February 13, 2024.

The Company filed

the Sixth Certificate of Amendment to Amended and Restated COD (the “Sixth Amendment”) with the Secretary of State of the

State of Delaware to reflect the new conversion price of the Series A Preferred Stock of $ 8.10 .

As of February 14, 2024, the Company used

the Black-Scholes option pricing model to determine the fair value of the then 1,296 Series A Preferred Stock outstanding and concluded

there was a gain on extinguishment of $ 122 .

At a stated value of $ 1,080 for each share of Series A Preferred Stock, the revised price

of $ 8.10 per share results in the 1,296 shares being convertible into 493,573 shares of Common Stock.

On March 14, 2024, pursuant

to the terms of the Third Note, the Company modified the conversion price of the 3i Exchange Warrants from $ 8.10 to $ 7.00 and thereby

increased the number of Exchange Warrants outstanding from 544,101 on February 13, 2024, to 829,423 on March 14, 2024.

The Company filed

the Seventh Certificate of Amendment to Amended and Restated COD (the “Seventh Amendment”) with the Secretary of State of

the State of Delaware to reflect the new conversion price of the Series A Preferred Stock of $ 7.00 .

As of March 14, 2024, the Company

used the Black-Scholes option pricing model to determine the fair value of the then 1,296 Series A Preferred Stock outstanding and concluded

there was a gain on extinguishment of $ 69 .

January 14, 2024, pursuant to the terms of the First Note, the Company modified the conversion price of the 3i Exchange Warrants from

$ 20.00 to $ 8.95 , thereby increasing the number of Exchange Warrants outstanding from 220,361 at December 31, 2023 to 492,317 outstanding

at January 14, 2024.

Also on January 14, 2024, the conversion price of the outstanding 1,417 shares of Series A Preferred Stock

was revised from $ 20.00 to $ 8.95 .

The Company filed the Fifth Certificate of Amendment to Amended and Restated COD (the “Fifth

Amendment”) with the Secretary of State of the State of Delaware to reflect the new conversion price of the Series A Preferred

Stock of $ 8.95 .

As of January 14, 2024, the Company used the Black-Scholes option pricing model to determine the fair value of the 1,417

Series A Preferred Stock outstanding at $ 1,970 versus their carrying value of $ 1,742 .

Accordingly, the Company has recorded a deemed

dividend of $ 228 as at January 14, 2024.

At a stated value of $ 1,080 for each share of Series A Preferred Stock, the revised price of

$ 7.00 per share results in the 1,215 shares being convertible into 535,286 shares of Common Stock.

$ 8.95 per share results in the 1,417 shares being convertible into 170,952 shares of Common Stock as of January 14, 2024.

February 13, 2024, pursuant to the terms of the Second Note, the Company modified the conversion price of the 3i Exchange Warrants from

$ 8.95 to $ 8.10 and thereby increased the number of Exchange Warrants outstanding from 492,317 on January 18, 2024, to 544,101 on February

The Company filed the Sixth Certificate of Amendment to Amended and Restated COD (the “Sixth Amendment”) with the

Secretary of State of the State of Delaware to reflect the new conversion price of the Series A Preferred Stock of $ 8.10 .

As of February

14, 2024, the Company used the Black-Scholes option pricing model to determine the fair value of the then 1,296 Series A Preferred Stock

outstanding and concluded there was a gain on extinguishment of $ 122 .

At a stated value of $ 1,080 for each share of Series A Preferred

Stock, the revised price of $ 8.10 per share results in the 1,296 shares being convertible into 493,573 shares of Common Stock.

March 14, 2024, pursuant to the terms of the Third Note, the Company modified the conversion price of the 3i Exchange Warrants from $ 8.10

to $ 7.00 and thereby increased the number of Exchange Warrants outstanding from 544,101 on February 13, 2024, to 829,423 on March 14,

The Company filed the Seventh Certificate of Amendment to Amended and Restated COD (the “Seventh Amendment”) with the

Secretary of State of the State of Delaware to reflect the new conversion price of the Series A Preferred Stock of $ 7.00 .

14, 2024, the Company used the Black-Scholes option pricing model to determine the fair value of the then 1,296 Series A Preferred Stock

outstanding and concluded there was a gain on extinguishment of $ 69 .

At a stated value of $ 1,080 for each share of Series A Preferred

Stock, the revised price of $ 7.00 per share results in the 1,215 shares being convertible into 535,286 shares of Common Stock.

the period April 1, 2024, through May 2, 2024, the Company amended the conversion prices of the Series A Convertible Preferred Stock,

the Exchange Warrants and the 2024 Notes to equal the current last sale price of its shares of Common Stock of $ 1.15 as of May 1, 2024.

(b) Accounting

Series A Preferred Stock

As a result of fair value

adjustments during the three month period ended March 31, 2024, the Company recognized a deemed dividend of $ 228 and an extinguishment

gain of $ 191 on our outstanding Series A Preferred Stock.

Inputs used in the Black-Scholes valuation models utilized to fair value the

modifications to the Series A Preferred Stock during the three month period ended March 31, 2024, are as follows:

a result of fair value adjustments during the six-month period ended June 30, 2024, the Company recognized a deemed dividend of $ 299

and an extinguishment gain of $ 222 on our outstanding Series A Preferred Stock.

Inputs used in the Black-Scholes valuation models utilized

to fair value the modifications to the Series A Preferred Stock during the six-month period ended June 30, 2024, are as follows:

January 14 – March 14,

April 5 – May 2,

Initial exercise price

$ 20.00 - $ 8.10

$ 7.00 - $ 1.15

Stock price on valuation date

$ 8.95 - $ 7.10

$ 4.52 - $ 1.23

Risk-free rate

5.10 % - 4.82 %

5.47 % - 5.49 %

Term (in years)

Rounded annual volatility

3i Warrants were identified as a freestanding financial instrument and meet the criteria for derivative liability classification, initially

measured at fair value.

Subsequent changes in fair value are recognized through earnings for as long as the contracts continue to be

classified as a liability.

The measurement of fair value is determined utilizing an appropriate valuation model considering all relevant

assumptions current at the date of issuance and at each reporting period (i.e., share price, exercise price, term, volatility, risk-free

rate and expected dividend rate).

Series A Preferred Stock Conversions

month period ended March 31, 2024

the three month period ended March 31, 2024, 3i exercised its option to convert 202 shares of Series A Preferred Stock for 27,092 shares

of common stock at the fair value of $ 269 .

As of March 31, 2024, we had 1,215 shares of Series A Preferred Stock issued and outstanding.

See Note 17(a) i.

month period ended March 31, 2023

the three month period ended March 31, 2023, 3i exercised its option to convert 3,838 shares of Series A Preferred Stock for 902 shares

of common stock at the fair value of $ 565 .

As of March 31, 2023, we had 9,748 shares of Series A Preferred Stock issued and outstanding.

accounting for the Series A Preferred Stock and Warrants is illustrated in the table below:

Consolidated Balance Sheets

145 % - 130 %

3i Exchange Warrants

3i Exchange Warrants were identified as a freestanding financial instrument and meet the criteria for derivative liability classification,

initially measured at fair value.

Subsequent changes in fair value are recognized through earnings for as long as the contracts continue

to be classified as a liability.

The measurement of fair value is determined utilizing an appropriate valuation model considering all

relevant assumptions current at the date of issuance and at each reporting period (i.e., share price, exercise price, term, volatility,

risk-free rate and expected dividend rate).

Series A Preferred Stock and 3i Exchange Warrant Conversions

Six month period ended June 30, 2024

the six-month period ended June 30, 2024:

exercised its option to convert 1,417 shares of Series A Preferred Stock for 479,223 shares of common stock at the fair value of $ 1,819 .

As of June 30, 2024, there were no issued and outstanding shares of Series A Preferred Stock;

(b) 3i exercised its option to convert 3,632,366 3i Exchange Warrants

for 2,359,650 shares of common stock valued at $ 405 .

As of June 30, 2024, there were no issued and outstanding 3i Exchange Warrants.

Six month period ended June 30, 2023

the six-month period ended June 30, 2023, 3i exercised its option to convert 12,052 shares of Series A Preferred stock for 202,002 shares

of common stock valued at $ 3,899 .

As of June 30, 2023, there were 6,047 issued and outstanding shares of Series A Preferred Stock.

accounting for the Series A Preferred Stock and Warrants is illustrated in the tables below:

Balance Sheets

Comprehensive

1 unchanged sentence

derivative and warrant

Balances at December 31, 2023

Balances, December

Conversion of 202 Series A Preferred Stock, net

Extinguishment of Series A Preferred Stock

Deemed dividend on January 14, 2024, modification

Fair value adjustment at March 31, 2024

Consolidated Balance Sheets

Extinguishment

of Series A Preferred Stock

dividend on January 14, 2024, modification

value adjustment

Balances, March 31, 2024

Conversion of 1,215 Series A Preferred Stock, net

Extinguishment

of Series A Preferred Stock

dividend on modification of Series A Preferred Stock

Cashless exercise of 3i

Exchange Warrants

value adjustment

June 30, 2024

Balance Sheets

Comprehensive

Convertible Preferred

adjustment to

derivative and warrant

Balances at December 31, 2022

Balances, December

Conversion of 3,838 Series A Preferred Stock, net

Fair value adjustment at March 31, 2023

C Convertible Preferred Stock

On February 28, 2023, the

Company entered into a Securities Purchase Agreement (the “2023 SPA”) with 3i for the purchase and sale of 50,000 shares

of Series C Convertible Redeemable Preferred Stock (“Series C Preferred Stock”) at a purchase price of $ 24.00 per share,

for a subscription receivable in the aggregate amount equal to the total purchase price of $ 1.2 million (the “Series C Offering”).

The 50,000 shares of Series C Preferred Stock (the “Shares”) are convertible into shares of the Company’s Common Stock,

subject to the terms of the Series C Certificate of Designation (“Series C COD”).

value adjustment

Balances, March 31, 2023

Conversion of 8,214 Series A Preferred Stock

Elimination of redemption rights on Series A Preferred stock;

deemed dividend of $ 3,328

Redemption of 1,550 Series A Preferred Stock

Issuance of 486 Series A Preferred stock as repayment of $ 350 debt;

$ 103 charged to interest expense

Exchange of 50,000 Series C Preferred Stock for 5,577 Series A Preferred Stock;

deemed dividend of $ 3,959

value adjustment

June 30, 2023

Series C Convertible

Preferred Stock

February 28, 2023, the Company entered into a Securities Purchase Agreement (the “2023 SPA”) with 3i for the purchase and

sale of 50,000 shares of Series C Convertible Redeemable Preferred Stock (“Series C Preferred Stock”) at a purchase price

of $ 24.00 per share, for a subscription receivable in the aggregate amount equal to the total purchase price of $ 1.2 million (the “Series

C Offering”).

The 50,000 shares of Series C Preferred Stock (the “Shares”) are convertible into shares of the Company’s

Common Stock, subject to the terms of the Series C Certificate of Designation (“Series C COD”).

Company evaluated the terms of the Series C Preferred Stock as required pursuant to ASC 570, 480, 815 and ASU 2020-06, and concluded

3 unchanged sentences

The roll forward

of the Series C Preferred Stock as of March 31, 2023, is as follows:

C Preferred Stock, cash received

debt discount, opening

of the Series C Preferred Stock as of June 30, 2023, is as follows:

Series C Preferred Stock, cash received

Less debt discount, opening

Plus, 5 % dividend and accretion

C Preferred Stock – net, ending balance

April 21, 2023, all of the 50,000 shares of Series C Preferred stock were exchanged for Series A Preferred Stock.

Exchange of Series C Preferred stock for Series A Preferred stock

Series C Preferred Stock – net, ending balance

Derivative Liabilities

(a) Continuity

of Common Share Purchase Warrant and 3i Warrant Derivative Liabilities

Continuity of Common

Share Purchase Warrant and 3i Warrant Derivative Liabilities

Common Share Purchase Warrants, comprised of the April 2023, July 2023 and September 2023 Inducement Warrants, and 3i Exchange Warrant

derivative liabilities are measured at fair value at each reporting period and the reconciliation of changes in fair value the year ended

December 31, 2023, and for the three month period ended March 31, 2024, is presented in the following tables:

derivative liabilities are measured at fair value at each reporting period and the reconciliation of changes in fair value for the year

ended December 31, 2023, and for the six-month period ended June 30, 2024, is presented in the following tables:

Balance as of January 1, 2023

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Balance as of December 31, 2023

Fair value per Common warrant / 3i Warrant / issuable at period end

Fair value per Common warrant / 3i Warrant / issuable at December 31, 2023

Balance as of January 1, 2024

Change in fair value adjustment of derivative and warrant liabilities

Balance as of March 31, 2024

Fair value per Common warrant / 3i Warrant / issuable at period end

Share Purchase Warrants – Valuation Inputs

March 31, 2024, the Company used the Black-Scholes Merton model to estimate the fair value of the Common Share Purchase Warrants derivative

Cashless conversion of 3i Exchange Warrants

Balance as of June 30, 2024

Fair value per Common warrant issuable at June 30, 2024

Common Share Purchase

Warrants – Valuation Inputs

June 30, 2024, the Company used the Black-Scholes Merton model to estimate the fair value of the Common Share Purchase Warrants derivative

liability at $ 16 , using the following inputs:

September 2023

exercise price

price on valuation date

annual volatility

Warrants – Valuation Inputs

On March 31, 2024 and 2023,

the Company utilized the reset strike options Type 2 model by Espen Garder Haug and Black-Scholes Merton models to estimate the fair value

of the 3i Warrants to be approximately $ 65 and $ 2,265 , respectively.

The 3i Warrants were valued at March 31, 2024 and 2023, using the

following inputs:

Initial exercise price

1 unchanged sentence

Risk-free rate

Term (in years)

Rounded annual volatility

3i Exchange Warrants

– Valuation Inputs

June 30, 2023, the Company utilized the reset strike options Type 2 model by Espen Garder Haug and Black-Scholes Merton models to estimate

the fair value of the 3i Warrants to be approximately $ 1,143 and $ 374 , respectively.

The 3i Warrants were valued at June 30, 2023, using

the following inputs:

Initial exercise price $ 30.00

Stock price on valuation date $ 6.60

Risk-free rate 5.02 %

Expected life of the Warrant to convert (years) 1.48

Rounded annual volatility 187 %

Timing of liquidity event

Timing of liquidity event Q3 - 2023

Expected probability of event 10 %

The shares of Series A Preferred Stock converted in the three-month

periods ended March 31, 2024 and 2023, were recorded at $ 269 and $ 565 , respectively.

Stockholders’ Equity

(a) Amendment to Certificate of Incorporation

– Reverse Stock Split

On April 4, 2024, the Company

filed a Fifth Certificate of Amendment to the Certificate of Incorporation with the Delaware Secretary of State to effect a 1-for-20 share

consolidation of our shares of Common Stock effective as of April 9, 2024 (“Share Consolidation”).

No fractional shares

were issued in connection with the Share Consolidation.

If, as a result of the Share Consolidation, a stockholder would otherwise have

been entitled to a fractional share, each fractional share was rounded up to the next whole number.

The Share Consolidation resulted in

a reduction of our outstanding shares of Common Stock as of March 31, 2024, from 6,854,604 to 342,774 .

The par value of our authorized

stock remained unchanged at $ 0.0001 .

As of the date of the Financial Statements all references to our Common Stock have been retrospectively

adjusted to reflect the one for 20 shares, unless otherwise noted.

The Company is authorized to issue 750,500,000 shares, consisting of

(i) 750,000,000 shares of Common Stock, par value $ 0.0001 per share, and (ii) 500,000 shares of Preferred Stock, par value of $0.0001

Amendment to Certificate of Incorporation – Reverse Share Split

April 4, 2024, the Company filed a Fifth Certificate of Amendment to the Certificate of Incorporation with the Delaware Secretary of

State to effect a 1-for-20 share consolidation of our shares of Common Stock effective as of April 9, 2024 (“Share Consolidation”).

No fractional shares were issued in connection with the Share Consolidation.

If, as a result of the Share Consolidation, a stockholder

would otherwise have been entitled to a fractional share, each fractional share was rounded up to the next whole number.

The Share Consolidation

resulted in a reduction of our outstanding shares of Common Stock as of March 31, 2024, from 6,854,604 to 342,774 .

The par value of our

authorized stock remained unchanged at $ 0.0001 .

As of the date of the unaudited interim condensed consolidated financial statements all

references to our Common Stock have been retrospectively adjusted to reflect the one for 20 shares, unless otherwise noted.

is authorized to issue 750,500,000 shares, consisting of (i) 750,000,000 shares of Common Stock, par value $ 0.0001 per share, and (ii)

500,000 shares of Preferred Stock, par value of $ 0.0001 per share.

Share issuances

month period ended March 31, 2024

the three month period ended March 31, 2024,

Three month period ended June 30, 2024

the three month period ended June 30, 2024:

(a) On March 19, 2024, the Company entered into an open market sale agreement (as amended, the “ATM Agreement”) with Ascendiant Capital (“Ascendiant”) pursuant to which, the Company may sell from time to time, through Ascendiant, shares of its common stock for an aggregate sales price of up to $ 30.0 million.

Any sales of shares pursuant to this agreement are made under the Company’s effective “shelf” registration statement on Form S-3 that is on file with and has been declared effective by the SEC.

During the three month period ended June 30, 2024, the Company issued and sold 31,884,641 shares of Common Stock resulting in gross proceeds of $ 27,652 , net of fees of $ 855 , pursuant to the terms of its ATM Agreement;

(b) 3i exercised its option to convert 1,215 shares of Series A Preferred Stock for 27,092 shares of Common Stock at the fair value of $ 1,510 .

As of June 30, 2024, there were no shares of Series A Preferred Stock issued and outstanding;

(c) 3i converted 200,000 Exchange Warrants on a cashless basis for 84,712 shares of Common Stock at $ 2.30 per share on April 12, 2024, and 3,432,366 Exchange Warrants at $ 1.15 per share for 2,274,938 shares of Common Stock on May 2, 2024.

As June 30, 2024, there are no outstanding Exchange Warrants.

Three month period ended June 30, 2023

the three months ended June 30, 2023, the Company issued:

11,210 shares of common stock valued at $ 3,334 upon the conversion of 8,214 shares of Series A Preferred stock;

3,587 shares of our Common Stock and 3,587 common stock purchase warrants, each exercisable for one share of Common Stock, at a combined

public offering price of $ 600.00 , and 8,913 pre-funded warrants, each exercisable for one share of Common Stock, and 8,913 common stock

purchase warrants, each exercisable for one share of common stock only (the common stock purchase warrants sold in the public offing

hereinafter referred to as the “April 2023 Common Warrants”) at a combined public offering price of $ 600.00 less the $ 0.001

for the pre-funded warrants, for aggregate gross proceeds of approximately $ 7.5 million, before deducting placement agents fees and offering

expenses payable by the Company, or the April Offering.

The Common Stock, pre-funded warrant and April 2023 Common Warrants were sold

pursuant to a securities purchase agreement with the purchaser signatory thereto or pursuant to the prospectus which was part of an effective

registration statement on Form S-1 filed with the SEC.

The Common Stock, pre-funded warrants and April 2023 Common Warrants are immediately

separable and were issued separately in the offering.

As of June 30, 2023, all pre-funded warrants from the April Offering have been

exercised in exchange for 12,500 common shares.

Six month period ended June 30, 2024

the six months ended June 30, 2024:

(a) 3i exercised its option to convert 1,417 shares of Series A Preferred Stock for 479,223 shares of Common Stock at the fair value of $ 1,819 .

As of March 31, 2024, we had 1,215 shares of Series A Preferred Stock issued and outstanding.

See Note 17(a) i;

As of June 30, 2024 there are no remaining Series A Preferred Stock issued and outstanding.

(b) The Company issued 14,500 shares of Common Stock valued at $ 90 to James G.

Cullem (the Company’s former CEO) in exchange for consulting services;

(c) Pursuant to the terms of an ATM Offering, the Company issued and sold 6,792 shares of Common Stock in exchange for $ 40 in cash.

Three month period ended March 31, 2023

During the three months ended

March 31, 2023, the Company issued 902 shares of Common Stock valued at $ 565 , as a result of the conversion of 3,838 shares

of Series A Preferred Stock.

(c) the Company issued and sold 31,891,433 shares of Common Stock resulting in gross proceeds of $ 27,692 , net of $ 857 in fees pursuant to the terms of its ATM Agreement.

Six month period ended June 30, 2023

During the six months ended June 30, 2023, the Company issued 241,893

shares of common stock valued at $ 3,899 upon the conversion of 12,052 shares of Series A Preferred Stock;

and 250,000 shares of Common

Stock as a result of its April Public Offering of 71,734 shares of our Common Stock and the exercise of 178,267 pre-funded warrants.

Stock-based payment plan and stock-based payments

and Restated 2021 Equity Incentive Plan (the “Plan”)

During the three months ended

March 31, 2024, pursuant to approval by the Company’s Board of Directors, the Company has amended and restated the Plan as follows:

the six months ended June 30, 2024, pursuant to approval by the Company’s Board of Directors, the Company has amended and restated

the Plan as follows:

Number of shares available:

1 unchanged sentence

333-258968) and 108,416 Shares.

For the sake of clarity, the initial number of Shares reserved and available for grant as of the date of adoption of the Plan by the Board is an amount equal to 15 % of the Company’s issued and outstanding shares of Common Stock issued in the Company’s Recapitalization Share Exchange covered by the Company’s registration statement on Form S-4 (SEC File No.

Automatic Share Reserve Increase:

The number of Shares available for grant and issuance under the Plan will be increased on January 1 st of each of 2022 through 2031, by the lesser of (a) 5 % of the number of shares of all classes of the Company’s common stock issued and outstanding on each December 31 immediately prior to the date of increase or (b) such number of Shares determined by the Board.

the three months ended March 31, 2024, total stock-based payment (recoveries) / expenses recorded in the condensed consolidated statement

of operations and comprehensive loss were ($ 32 ), of which ($ 21 ) and ($ 11 ) are recognized as general and administrative and research and

development recoveries, respectively.

During the three months ended March 31, 2023, total stock-based payment (recoveries) / expenses

recorded in the condensed consolidated statement of operations and comprehensive loss were ($ 121 ), of which ($ 82 ) and ($ 39 ) are recognized

as general and administrative and research and development recoveries, respectively.

Total compensation cost for non-vested warrants as at March 31,

2024, is $ 32 and is expected to be realized through the end of December 31, 2024.

During the three-month periods ended March 31, 2024,

and 2023, no options were granted.

summary of stock option activity under the Company’s stock option plans during the three-month period ended March 31, 2024,

is presented below:

the three months ended June 30, 2024, total stock-based payment expenses recorded in the condensed consolidated statement of operations

and comprehensive loss were $ 22 , of which $ 14 and $ 8 are recognized as general and administrative and research and development recoveries,

respectively.

During the three months ended June 30, 2023, total stock-based payment expenses recorded in the condensed consolidated

statement of operations and comprehensive loss were $ 180 , of which $ 59 and $ 121 are recognized as general and administrative and research

and development recoveries, respectively.

the six months ended June 30, 2024, total stock-based (recoveries) recognized in the condensed consolidated statement of operations and

comprehensive loss were ($ 10 ), of which ($ 7 ) and ($ 3 ) are recognized as staffing expenses in general and administrative and research

and development expenses, respectively.

During the six months ended June 30, 2023, total stock-based expenses recognized in the condensed

consolidated statement of operations and comprehensive loss were $ 59 of which $ 20 and $ 39 are recognized as staffing expenses in general

and administrative and research and development expenses, respectively.

compensation cost for non-vested warrants as at June 30, 2024, is $ 14 and is expected to be realized through the end of September 30,

During the six-month periods ended June 30, 2024 and 2023, no options were granted.

A summary of stock option activity under

the Company’s stock option plans during the six-month period ended June 30, 2024, is presented below:

Options Outstanding

Shares Weighted

Price Share Weighted

Life (in years)

1 unchanged sentence

Cancelled or expired ( 8 ) 186,504 —

Outstanding as of March 31, 2024

Options exercisable at March 31, 2024

Outstanding as of June 30, 2024 11 $ 104,354 2.59

Options exercisable at June 30, 2024 11 $ 27,524 2.55

License and Development Agreements

License Agreement with Novartis for Dovitinib

On January 26, 2024, we received

a termination notice from Novartis due to a material breach of the License Agreement.

Accordingly, under the terms of the License Agreement,

the Company ceased all development and commercialization activities with respect to all licensed products, all rights and licenses granted

by Novartis to the Company reverted to Novartis;

and all liabilities due to Novartis became immediately due and payable inclusive of interest

which is continuing to accrue at 5 % per annum.

As of March 31, 2024, the liability is recorded as a current liability on the Company’s

condensed unaudited consolidated balance sheets as follows:

$ 3,600 in accounts payable, $ 1,317 convertible promissory notes and accrued

interest, net of debt discount, and $ 147 in accrued liabilities.

License Agreement with Eisai Inc.

Agreement with Novartis for Dovitinib

January 26, 2024, the Company received a termination notice from Novartis due to a material breach of the License Agreement.

under the terms of the License Agreement, the Company ceased all development and commercialization activities with respect to all licensed

products, all rights and licenses granted by Novartis to the Company reverted to Novartis;

and all liabilities due to Novartis became

immediately due and payable inclusive of interest which is continuing to accrue at 5 % per annum.

As of June 30, 2024, the liability is

recorded as a current liability on the Company’s condensed unaudited consolidated balance sheets as follows:

$ 3,600 in accounts

payable, $ 1,325 convertible promissory notes and accrued interest, net of debt discount, and $ 192 in accrued liabilities.

Agreement with Eisai Inc.

for Stenoparib

10 unchanged sentences

serving as a forum for exchanging data, information and development strategy.

Effective July 12, 2022, the

Company’s July 6, 2017 Exclusive License Agreement with Eisai Inc.

(the “Third Amendment”), the terms of the original

exclusive license were further amended in order to (1) further postpone the due date of the extension payment and extend the deadline

for the Company’s successful completion of its first Phase 1b or Phase 2 clinical trial for Stenoparib beyond December 31,

July 12, 2022, the Company’s July 6, 2017 Exclusive License Agreement with Eisai Inc.

(the “Third Amendment”), the

terms of the original exclusive license were further amended in order to (1) further postpone the due date of the extension payment and

extend the deadline for the Company’s successful completion of its first Phase 1b or Phase 2 clinical trial for Stenoparib beyond

December 31, 2022;

and (2) amend terms related to Eisai’s right of termination of development.

On May 26, 2023, the Company

and Eisai entered into a fourth amendment to the Exclusive License Agreement with an effective date of May 16, 2023, to postpone the extension

payment, restructure the payment schedule and extend the deadline to complete enrollment in a further Phase 1b or Phase 2 Clinical Trial

for the Stenoparib.

May 26, 2023, the Company and Eisai entered into a fourth amendment to the Exclusive License Agreement with an effective date of May

16, 2023, to postpone the extension payment, restructure the payment schedule and extend the deadline to complete enrollment in a further

Phase 1b or Phase 2 Clinical Trial for the Stenoparib.

The Company agreed to pay Eisai in periodic payments as follows:

(i) $ 100 , which has been paid;

(ii) $50 within 10

days of execution of the fourth amendment, which has been paid;

(iii) $ 100 upon completion of a capital raise, which has been paid;

(iv) $ 850 on or before March 1, 2024.

On February 26, 2024, in exchange

for an additional $ 150 , paid as of May 1, 2024, the Company and Eisai entered into a fifth amendment to the Exclusive License Agreement

to postpone the payment of $ 850 until the completion of a ten million dollar financing, expected to be completed before the end of May

2024, but in no event later than September 1, 2024.

(i) $ 100 , which

has been paid;

(ii) $ 50 within 10 days of execution of the fourth amendment, which has been paid;

(iii) $ 100 upon completion of a capital

raise, which has been paid;

and (iv) $ 850 on or before March 1, 2024.

February 26, 2024, in exchange for an additional $ 150 , paid as of May 1, 2024, the Company and Eisai entered into a fifth amendment to

the Exclusive License Agreement to postpone the payment of $ 850 by no later than September 1, 2024.

The Company is currently in

negotiations with Eisai to further amend the terms of its Exclusive License.

Milestone Payments

13 unchanged sentences

have been achieved, the Company may be obligated to pay Eisai up to a maximum of $ 94 million.

In addition, the Company has agreed to pay

Eisai a one-time sales milestone payment in the amount of $ 50 million the first time the Company’s annual sales of licensed product

is $ 1 billion or more.

In addition to the milestone

payments described above, the Company has agreed to pay Eisai royalties based on annual incremental sales of product derived from Stenoparib

in an amount between 5 % and 10 % of annual sales of between $0 and $ 100 million, between 6 % and 10 % of annual sales between $ 100 million

and $ 250 million, between 7 % and 11 % of annual sales between $ 250 million and $ 500 million, and between 11 % and 15 % of annual sales in

excess of $ 500 million.

The Company is obligated to

pay royalties under the agreement on a country-by-country and product-by-product basis for a period that commences with the first commercial

sale of a product until the later of (i) the expiration of the last to expire valid claim of any licensed patent covering such licensed

product in such country;

or, (ii) the expiration of regulatory-based exclusivity for such licensed product in such country or (iii) the

15 year anniversary of the date of first commercial sale of such licensed product in such country.

However, the agreement may be terminated

sooner without cause by the Company upon 120 days prior written notice, or upon written notice of a material breach of the agreement

by Eisai that is not cured within 90 days (30 days for a payment default).

In addition, the Company has agreed to

pay Eisai a one-time sales milestone payment in the amount of $ 50 million the first time the Company’s annual sales of licensed

product is $ 1 billion or more.

addition to the milestone payments described above, the Company has agreed to pay Eisai royalties based on annual incremental sales of

product derived from Stenoparib in an amount between 5 % and 10 % of annual sales of between $ 0 and $ 100 million, between 6 % and 10 % of

annual sales between $ 100 million and $ 250 million, between 7 % and 11 % of annual sales between $ 250 million and $ 500 million, and between

11 % and 15 % of annual sales in excess of $ 500 million.

Company is obligated to pay royalties under the agreement on a country-by-country and product-by-product basis for a period that commences

with the first commercial sale of a product until the later of (i) the expiration of the last to expire valid claim of any licensed

patent covering such licensed product in such country;

or, (ii) the expiration of regulatory-based exclusivity for such licensed

product in such country or (iii) the 15 year anniversary of the date of first commercial sale of such licensed product in such country.

However, the agreement may be terminated sooner without cause by the Company upon 120 days prior written notice, or upon written

notice of a material breach of the agreement by Eisai that is not cured within 90 days (30 days for a payment default).

also has the right to terminate the agreement upon written notice of a material breach of the agreement by the Company that is not cured

within 90 days (30 days for a payment default) or if the Company files for bankruptcy.

By an amendment effective as of August

3, 2021, and executed by Eisai on August 23, 2021, Eisai also has the right to terminate the agreement if the Company does not complete

a Phase 2 clinical trial before December 31, 2022, unless we elect to pay a $ 1,000 extension payment (the “Extension Payment”).

Notwithstanding the foregoing, in the event the Company fails to enroll and dose at least 30 patients with the first dose of cancer drug

in the ongoing Phase 2 Ovarian Cancer Clinical Trial by July 1, 2022, then the Extension Payment will be due and payable in fully by July

In addition, if the Company fails to achieve successful completion of first Phase 2 Clinical Trial prior to December 31, 2022,

and does not elect to pay the Extension Payment then Eisai may terminate the agreement in its sole discretion pursuant to the terms of

the amendment.

As of the date of this filing, the Company

is currently renegotiating the terms of its Exclusive License with Eisai.

to Reacquire Rights to Stenoparib

For the period commencing

with enrollment of the first five patients in a Phase 2 clinical trial pursuant to the clinical development plan and ending 90 days following

successful completion of such Phase 2 clinical trial, Eisai has the option to reacquire our licensed rights to develop Stenoparib for

a purchase price equal to the fair market value of our rights, giving effect to the stage of development of Stenoparib that we have completed

under the agreement.

The Company commenced a Phase 2 clinical trial April 15, 2019, and as of the date of the Financial Statements, Eisai

has not indicated an intention to exercise its repurchase option.

Development, Option and License Agreement with R-Pharm for IXEMPRA®

On March 1, 2019, the Company

entered into an option to in-license the rights to any and all therapeutic and/or diagnostic uses in humans for IXEMPRA ®

in the European Union (Great Britain but excluding Switzerland and Lichtenstein) (the “Territory”) from R-Pharm U.S.

LLC (“R-Pharm”), pursuant to a Development, Option and License Agreement (the “Option”).

By an amendment to the

agreement dated August 4, 2022, for no consideration, the Option will expire on September 1, 2023, if not exercised by the Company before

The Option provides a right of extension, should we elect, for an additional $ 250 .

As of the date of this Quarterly Report, the

Company has not extended the option with R-Pharm.

the period commencing with enrollment of the first five patients in a Phase 2 clinical trial pursuant to the clinical development plan

and ending 90 days following successful completion of such Phase 2 clinical trial, Eisai has the option to reacquire our licensed rights

to develop Stenoparib for a purchase price equal to the fair market value of our rights, giving effect to the stage of development of

Stenoparib that we have completed under the agreement.

The Company commenced a Phase 2 clinical trial April 15, 2019, and as of the date

of the Financial Statements, Eisai has not indicated an intention to exercise its repurchase option.

Related party

the three month periods March 31, 2024 and 2023, a director of the Company was paid $ 125 and $ 45 respectively, in fees as a consultant.

the six month periods June 30, 2024 and 2023, a director of the Company was paid $ 192 and $ 77 respectively, in fees as a consultant.

Effective June 1, 2024, the Company executed a Chief Executive Officer Management Services Agreement with the Consultant in consideration

for $ 525 per year and $ 100 as a signing bonus, which was paid in June 2024.

Loss per share of common stock

Basic loss per share is derived

by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during each

Diluted loss per share includes the effect, if any, of the potential exercise or conversion of securities, such as warrants and

stock options, which would result in the issuance of incremental shares of common stock unless such effect is anti-dilutive.

In calculating

the basic and diluted net loss per share applicable to common stockholders, the weighted average number of shares remained the same for

both calculations because when a net loss exists, dilutive shares are not included in the calculation.

Potentially dilutive securities

outstanding, as determined by the latest applicable conversion price, that have been excluded from diluted loss per share due to being

anti-dilutive include the following:

loss per share is derived by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock

outstanding during each period.

Diluted loss per share includes the effect, if any, of the potential exercise or conversion of securities,

such as warrants and stock options, which would result in the issuance of incremental shares of common stock unless such effect is anti-dilutive.

In calculating the basic and diluted net loss per share applicable to common stockholders, the weighted average number of shares remained

the same for both calculations because when a net loss exists, dilutive shares are not included in the calculation.

Potentially dilutive

securities outstanding, as determined by the latest applicable conversion price, that have been excluded from diluted loss per share

due to being anti-dilutive include the following:

Three- and six-months ended

Warrants and stock options

Series A Convertible Preferred stock

Series C Convertible Preferred stock

Convertible debt

Financial Instruments

1 unchanged sentence

indicate the level of the fair value hierarchy used to determine such fair values:

Fair Value Measurements as of March 31, 2024, Using:

Fair Value Measurements as of June 30, 2024, Using:

Warrant liability

Derivative warrant liability

Fair Value Measurements as of December 31, 2023, Using:

1 unchanged sentence

Derivative warrant liability

Methods used to estimate the

fair values of our financial instruments, not disclosed elsewhere in the Financial Statements, are as follows:

When available, the Company’s

marketable securities are valued using quoted prices for identical instruments in active markets.

If the Company is unable to value its

marketable securities using quoted prices for identical instruments in active markets, the Company values its investments using broker

reports that utilize quoted market prices for comparable instruments.

The Company has no financial assets or liabilities measured using

Level 2 inputs.

Financial assets and liabilities are considered Level 3 when their fair values are determined using pricing models, discounted

cash flow methodologies, or similar techniques, and at least one significant model assumption or input is unobservable.

The Company recognizes its

derivative liabilities as Level 3 and values its derivatives using the methods discussed below.

While the Company believes that its valuation

methods are appropriate and consistent with other market participants, it recognizes that the use of different methodologies or assumptions

to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date.

The primary assumptions that would significantly affect the fair values using terms in the notes that are subject to volatility and market

price of the underlying shares of Common Stock.

The Company reviews the fair

value hierarchy classification on a quarterly basis.

Changes in the ability to observe valuation inputs may result in a reclassification

of levels for certain securities within the fair value hierarchy.

The Company’s policy is to recognize transfers into and out of

levels within the fair value hierarchy at the date the actual event or change in circumstances that caused the transfer occurs.

determination is made to classify an asset or liability within Level 3, the determination is based upon the significance of the unobservable

inputs to the overall fair value measurement.

There were no transfers between Level 1 or Level 2 during the three-month periods ended

March 31, 2024 and 2023.

The effective tax rate for

the three-month periods ended March 31, 2024 and 2023, was not impacted by unbenefited losses.

used to estimate the fair values of our financial instruments, not disclosed elsewhere in the Financial Statements, are as follows:

available, the Company’s marketable securities are valued using quoted prices for identical instruments in active markets.

Company is unable to value its marketable securities using quoted prices for identical instruments in active markets, the Company values

its investments using broker reports that utilize quoted market prices for comparable instruments.

The Company has no financial assets

or liabilities measured using Level 2 inputs.

Financial assets and liabilities are considered Level 3 when their fair values are determined

using pricing models, discounted cash flow methodologies, or similar techniques, and at least one significant model assumption or input

is unobservable.

Company recognizes its derivative liabilities as Level 3 and values its derivatives using the methods described in Note 8.

Company believes that its valuation methods are appropriate and consistent with other market participants, it recognizes that the use

of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate

of fair value at the reporting date.

The primary assumptions that would significantly affect the fair values using terms in the notes

that are subject to volatility and market price of the underlying shares of Common Stock.

Company reviews the fair value hierarchy classification on a quarterly basis.

Changes in the ability to observe valuation inputs may

result in a reclassification of levels for certain securities within the fair value hierarchy.

The Company’s policy is to recognize

transfers into and out of levels within the fair value hierarchy at the date the actual event or change in circumstances that caused

the transfer occurs.

When a determination is made to classify an asset or liability within Level 3, the determination is based upon the

significance of the unobservable inputs to the overall fair value measurement.

There were no transfers between Level 1 or Level 2 during

the six-month periods ended June 30, 2024 and 2023.

Commitments and Contingencies

January 2023, the Company received a request to produce documents from the SEC that stated that the staff of the SEC is conducting an

investigation known as “ In the Matter of Allarity Therapeutics, Inc.

” to determine if violations of the federal securities

laws have occurred.

The documents requested appear to focus on submissions, communications, and meetings with the FDA regarding our NDA

for Dovitinib or Dovitinib-DRP.

The SEC letter also stated that investigation is a fact-finding inquiry and does not mean that that the

SEC has concluded that the Company or anyone else has violated the laws.

As a result of the disclosure of the SEC request, The Nasdaq

Stock Market LLC (“Nasdaq”) staff has also requested us to provide them with the information requested by the SEC in which

the Company is complying.

Nasdaq Delisting Notifications

On February 1, 2024, the

Company attended a de-listing appeal hearing with Nasdaq, and on March 12, 2024, the Company received a response from Nasdaq granting

the Company’s request to continue its listing on Nasdaq subject to the requirement that on or before April 24, 2024, the Company

shall demonstrate compliance with the Bid Price and on Equity Rules.

On April 27, 2024, we received a confirmation from Nasdaq that the

Company has regained compliance with the minimum bid price requirement in Listing Rule 5550(a)(2) (the “Bid Price Rule”),

as required by the Hearing Panel’s (“Panel”) decision of March 12, 2024.

As a result of the capital raise under the

ATM Offering, the Company has communicated to Nasdaq its belief that it has achieved compliance with the Equity Rules, subject to a confirmation

Investigation

On July 19, 2024, the Company

received a “Wells Notice” from the Staff of the SEC relating to the Company’s previously disclosed SEC investigation.

The Wells Notice relates to the Company’s disclosures regarding meetings with the United States Food and Drug Administration (the

“FDA”) regarding the Company’s NDA for Dovitinib or Dovitinib-DRP, which was submitted to the FDA in 2021.

understands that all conduct relating to the SEC Wells Notice occurred during or prior to fiscal year 2022.

The Company also understands

that three of its former officers received Wells Notices from the SEC relating to the same conduct.

A Wells Notice is neither a formal

charge of wrongdoing nor a final determination that the recipient has violated any law.

The Wells Notice informed the Company that the

SEC Staff has made a preliminary determination to recommend that the SEC file an enforcement action against the Company that would allege

certain violations of the federal securities laws.

The Company is continuing to cooperate with the SEC and maintains that its actions

were appropriate, and intends to pursue the Wells Notice process, including submitting a formal response to the SEC.

Delisting Notifications

June 18, 2024, the Company received a letter from the Nasdaq Listing Qualifications Staff (the “Staff”) of Nasdaq indicating

that the Company has not complied with the Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”) which is the requirement

that for 30 consecutive business days the bid price for the Company’s common stock close above the $ 1 per share minimum bid price

requirement for continued inclusion on the Nasdaq Capital Market.

On July 30, 2024, the Company attended a hearing before a

Nasdaq Hearings Panel and presented its plan for regaining compliance with the Bid Price Rule.

Nasdaq has advised the Company to expect

to receive a ruling within two weeks of July 30, 2024.

Subsequent Events

For the Financial Statements,

and for the three months then ended, the Company evaluated subsequent events through the date on which the Financial Statements were issued.

the Financial Statements, and for the six months then ended, the Company evaluated subsequent events through the date on which the Financial

Statements were issued.

All subsequent events not disclosed elsewhere in this Quarterly Report are disclosed below.

3i LP Transactions

During the period April

1, 2024, through May 6, 2024, 3i:

converted 1,215 Series A Preferred Stock for 452,131 shares of Common Stock at prices of between $ 1.15 and $ 7.00 per share (as of the date of the Financial Statements, all Series A Preferred Stock have been converted and there are no outstanding shares of Series A Preferred Stock);

converted 252,272 Exchange Warrants on a cashless basis for 84,712 shares of Common Stock at $ 2.30 per share of Common Stock on April 12, 2024, and 3,432,366 Exchange Warrants on a cashless basis for 2,274,938 shares of Common Stock at $ 1.15 per share of Common Stock (as of the date of the Financial Statements, there are no outstanding Exchange Warrants);

completely redeemed the 2024 Notes and interest for cash in the amount of $ 1,747 , inclusive of $ 1,540 principal and $ 207 interest.

Amended and Restated COD of Series A Convertible Preferred Stock and Warrant Adjustments

the period April 1, 2024, through May 2, 2024, the Company has amended the conversion prices of the Series A Convertible Preferred Stock,

the Exchange Warrants and the 2024 Notes to equal the current last sale price of its shares of Common Stock of $ 1.15 as of May 1, 2024.

the period April 1, 2024 through May 13, 2024, the Company has sold 14,352,186 shares of its Common Stock for net proceeds of

Pro-forma Balance Sheet (unaudited)

following pro forma unaudited condensed consolidated balance sheet is provided to illustrate the impact of all subsequent event transactions

described in the foregoing subsequent events disclosure, as if they had occurred at March 31, 2024.

As of March 31,

(In thousands, except share data)

Total other current assets

Total non-current assets

LIABILITIES AND STOCKHOLDER’S EQUITY (DEFICIT)

Total current liabilities

Total non-current liabilities

Total liabilities

Shareholders equity (deficit)

Total Redeemable preferred stock

Additional paid-in capital

Accumulated other comprehensive loss

Accumulated deficit

Total Stockholders’ (deficit) equity

Total liabilities and stockholders’ equity (deficit)

ATM Offering – Sales

the period July 1, 2024 through August 5, 2024, the Company has sold 7,340,312 shares of its Common Stock for net proceeds of $ 1,404 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements