What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-08-15 compared with 2025-05-09 · 166 added, 138 removed, 437 unchanged (41% of the section changed)

7 unchanged sentences

Receivables from ATM sales

Restricted cash

Other current assets

15 unchanged sentences

Total current liabilities

11,061 10,839

Total liabilities

11,061 10,839

Commitments and contingencies (Note 9)

1 unchanged sentence

Common stock, $ 0.0001 par value ( 250,000,000 shares authorized);

17,021,970 and 7,302,797 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively

17,075,338 and 7,302,797 shares issued and 14,619,636 and 7,302,797 outstanding at June 30, 2025, and December 31, 2024, respectively

Additional paid-in capital

4 unchanged sentences

( 124,018 ) ( 118,966 )

Treasury stock, at cost;

2,455,702 shares

Total stockholders’ equity

8 unchanged sentences

Three Months Ended

Six Months Ended

Operating expenses:

Research and development

$ 1,403 $ 2,170

General and administrative

1 unchanged sentence

Loss from operations

( 3,036 ) ( 4,240 )

Other income (expense):

1 unchanged sentence

Interest expense

( 57 ) ( 102 )

Foreign exchange gains

Foreign exchange gains (losses)

Change in fair value of derivative and warrant liabilities

1 unchanged sentence

Loss before income tax benefit

( 2,732 ) ( 3,847 )

Income tax benefit

( 2,732 ) ( 3,843 )

Gain on extinguishment of Series A Convertible Preferred Stock

1 unchanged sentence

Net loss attributable to common stockholders

$ ( 2,732 ) $ ( 3,880 )

Net loss per common share, basic and diluted

$ ( 0.25 ) $ ( 664.16 )

Weighted average common shares outstanding, basic and diluted

11,146,922 5,842

Other comprehensive loss

$ ( 2,732 ) $ ( 3,843 )

Change in cumulative translation adjustment

Total comprehensive loss

$ ( 3,008 ) $ ( 3,818 )

* All common share data has been retroactively adjusted to effect reverse stock splits in 2024 (See Note 1).

2 unchanged sentences

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

For the three months ended March 31, 2025 and 2024

For the three and six months ended June 30, 2025 and 2024

(in thousands, except for share data*)

14 unchanged sentences

— — 227 — 40 — — 40

Reverse split (1-for-30) rounding adjustment

Reverse split (1-30) rounding adjustment

— — ( 1 ) — — — — —

7 unchanged sentences

1,215 1,510 11,426 — 90,699 ( 386 ) ( 98,294 ) ( 6,471 )

Conversion of Preferred Stock into common stock, net

( 1,215 ) ( 1,550 ) 15,071 — 1,550 — — —

Extinguishment of preferred stock

— ( 31 ) — — 31 — — —

Deemed dividend on preferred stock

— 71 — — ( 71 ) — — —

Cashless exercise of 3i Exchange Warrants

— — 78,655 — 405 — — 405

Sale of common shares, net

— — 1,062,821 3 27,649 — — 27,652

Stock based compensation (recoveries)

— — — — 22 — — 22

Currency translation adjustment

— — — — — ( 144 ) — ( 144 )

Loss for the period

— — — — — — ( 1,629 ) ( 1,629 )

Balance, June 30, 2024

— $ — 1,167,973 $ 3 $ 120,285 $ ( 530 ) $ ( 99,923 ) $ 19,835

Stockholders’

Treasury Stock

Comprehensive

Balance, December 31, 2024

7,302,797 $ 1 $ 131,130 — $ — $ ( 354 ) $ ( 118,966 ) $ 11,811

Stock-based compensation

— — 139 — — — — 139

Issuance of common stock, net of offering costs under open market sales agreement (ATM)

9,719,173 1 9,726 — — — — 9,727

Currency translation adjustment

— — — — — ( 276 ) — ( 276 )

Loss for the period

— — — — — ( 2,732 ) ( 2,732 )

Balance, March 31, 2025

17,021,970 2 140,995 — — ( 630 ) ( 121,698 ) 18,669

Stock-based compensation

— — 164 — — — — 164

Issuance of common stock for service

53,368 — 50 — — — — 50

Repurchase of common stock

— — — 2,455,702 ( 2,565 ) — — ( 2,565 )

Currency translation adjustment

— — — — — ( 1,831 ) — ( 1,831 )

Loss for the period

— — — — — — ( 2,320 ) ( 2,320 )

Balance, June 30, 2025

17,075,338 $ 2 $ 141,209 2,455,702 $ ( 2,565 ) $ ( 2,461 ) $ ( 124,018 ) $ 12,167

* All common share data has been retroactively adjusted to effect reverse stock splits in 2024 (See Note 1).

3 unchanged sentences

(in thousands)

Three Months Ended

Six Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

1 unchanged sentence

Depreciation and amortization

Common stock issued for services

Stock-based compensation

2 unchanged sentences

Change in fair value of warrant and derivative liabilities

Deferred income taxes

Changes in operating assets and liabilities:

Deferred income taxes

Other current assets

8 unchanged sentences

Proceeds from convertible promissory notes and accrued interest, net of discount

Repayment of debt and promissory notes

Common stock repurchase

Net cash provided by financing activities

Net increase (decrease) in cash, cash equivalents and restricted cash

Effect of exchange rate changes on cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash, beginning of period

Cash, cash equivalents, and restricted cash, end of period

Net increase in cash and cash equivalents

Effect of exchange rate changes on cash and cash equivalents

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

Supplemental information

Cash paid for interest

Supplemental disclosure of non-cash financing and investing activities:

3 unchanged sentences

Stock issued in conjunction with consulting agreement

As reported within consolidated balance sheets:

Cash and cash equivalents

Restricted cash

Total cash and cash equivalents and restricted cash as presented in the condensed consolidated balance sheet

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

See accompanying notes to condensed consolidated financial statements.

9 unchanged sentences

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, 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 Financial Statements are issued.

The Company had an accumulated deficit of $ 121.7 million as of March 31, 2025.

Further, the Company incurred a net loss of $ 2.7 million and experienced negative cash flows from operations of $ 2.7 million for the three months ended March 31, 2025.

Based on the Company’s current operating plan, it estimates that its existing cash, cash equivalents and restricted cash of $ 27.7 million as of March 31, 2025 will be sufficient to enable the Company to fund its operating expenses and capital requirements through at least the next 12 months from the issuance of these Financial Statements.

The Company had an accumulated deficit of $ 124.0 million as of June 30, 2025.

Further, the Company incurred a net loss of $ 5.1 million and experienced negative cash flows from operations of $ 8.2 million for the six months ended June 30, 2025.

Based on the Company’s current operating plan, it estimates that its existing cash, cash equivalents and restricted cash of $ 17.8 million as of June 30, 2025 will be sufficient to enable the Company to fund its operating expenses and capital requirements through at least the next 12 months from the issuance of these Financial Statements.

While 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 the Financial Statements, the Company’s liquidity could be materially affected over this period by:

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Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the ASC and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”).

The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of our management, reflect all adjustments, which include only normal recurring adjustments, necessary to fairly state our financial position as of March 31, 2025, our results of operations and stockholders’ equity for the three months ended March 31, 2025 and 2024, and cash flows for the three months ended March 31, 2025 and 2024.

The financial data and the other financial information disclosed in these notes to the condensed consolidated financial statements related to the three -month periods are also unaudited.

The results of operations for the three months ended March 31, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025 or for any other future annual or interim period.

The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of our management, reflect all adjustments, which include only normal recurring adjustments, necessary to fairly state our financial position as of June 30, 2025, our results of operations and stockholders’ equity for the three and six months ended June 30, 2025 and 2024, and cash flows for the six months ended June 30, 2025 and 2024.

The financial data and the other financial information disclosed in these notes to the condensed consolidated financial statements related to the three and six month periods are also unaudited.

The results of operations for the three and six months ended June 30, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025 or for any other future annual or interim period.

The condensed consolidated balance sheet data as of December 31, 2024 was derived from our audited financial statements, but does not include all disclosures required by GAAP.

11 unchanged sentences

The preparation of Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting years.

Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the fair value of the Series A preferred shares, warrants, 3i Exchange Warrants, convertible debt, 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.

Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, the fair value of the Series A preferred shares, warrants, 3i Exchange Warrants, convertible debt, and the accrual for research and development expenses, 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.

17 unchanged sentences

Adjustments that arise from exchange rate translations are included in other comprehensive loss in the consolidated statements of operations and comprehensive loss as incurred.

During the three months ended March 31, 2025 and 2024 , the Company recorded accumulated foreign currency translation losses of $ 0.3 million and $ 0.0 , respectively.

During the three months ended June 30, 2025 and 2024 , the Company recorded foreign exchange gains (losses) of $ 1.6 million and ($ 0.1 ) million, respectively.

During the six months ended June 30, 2025 and 2024, the Company recorded foreign exchange gains (losses) of $ 1.7 million and ($ 0.1 ) million, respectively.

Concentrations of credit risk and of significant suppliers

6 unchanged sentences

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

Cash, cash equivalents and restricted cash

Cash and cash equivalents

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

2 unchanged sentences

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

The Company had no cash equivalents on March 31, 2025 and December 31, 2024.

The Company had earmarked restricted cash on March 31, 2025 of $ 2.5 million for the purpose of payment to the SEC.

The Company had no cash equivalents on June 30, 2025 and December 31, 2024.

Property, plant and equipment

7 unchanged sentences

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, 2025 and 2024 , the Company’s other comprehensive (loss) and gain was comprised of currency translation adjustments.

During the three and six months ended June 30, 2025 and 2024 , the Company’s other comprehensive (loss) and gain was comprised of currency translation adjustments.

Recently Issued Accounting Pronouncements

17 unchanged sentences

Total accrued expenses and other current liabilities

$ 2,977 $ 5,232

Convertible promissory note due to Novartis

2 unchanged sentences

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, 2025 , the liability is recorded as a current liability on the Company’s condensed unaudited consolidated balance sheets as follows:

As of June 30, 2025 , the liability is recorded as a current liability on the Company’s condensed unaudited consolidated balance sheets as follows:

$ 3.6 million in accounts payable, $ 1.4 million convertible promissory notes and accrued interest, net of debt discount, and $ 0.4 million in accrued liabilities.

4 unchanged sentences

Warrant liabilities are categorized within Level 3 of the fair value hierarchy and are measured at fair value on a recurring basis.

The warrants issued in April 2023, July 2023, and September 2023 ( the “2023 Warrants”) are measured at fair value at each reporting period and the reconciliation of changes in fair value during the three months ended March 31, 2025 is presented in the following table:

The warrants issued in April 2023, July 2023, and September 2023 ( the “2023 Warrants”) are measured at fair value at each reporting period and the reconciliation of changes in fair value during the six months ended June 30, 2025 is presented in the following table:

($ in thousands)

1 unchanged sentence

Change in fair value of warrant derivative liability

Balance at March 31, 2025

On March 31, 2025 , the Company used the Black-Scholes Merton model to estimate the fair value of the 2023 Warrants derivative liability at approximately $ 0 , using the following inputs:

Balance at June 30, 2025

On June 30, 2025 , the Company used the Black-Scholes Merton model to estimate the fair value of the 2023 Warrants derivative liability at approximately $ 0 , using the following inputs:

September 2023

10 unchanged sentences

Stockholders ’ Equity

Share Repurchase Plan

On March 3, 2025, the board of directors approved a share repurchase program, with authorization to purchase up to $ 5 million of the Company’s outstanding shares of common stock.

For the three months ended June 30, 2025, the Company repurchased 2,455,702 shares for an aggregate cost of $ 2,565,511 , inclusive of all transaction fees.

For the six months ended June 30, 2025 and 2024, the total proceeds used to repurchase shares were $ 2,565,511 and $ 0 , respectively.

As of June 30, 2025, there is $ 2,434,489 remaining for share repurchases under the share repurchase program.

Share Issuance for Services

On April 4, 2025, the Company issued 53,368 restricted shares to a vendor in exchange for services rendered.

On March 19, 2024, the Company entered into an At-The-Market Issuance Sales Agreement, as amended (the “Sales Agreement”) with Ascendiant Capital Markets, LLC (“Ascendiant”) pursuant to which, the Company may offer and sell, from time to time at its sole discretion, shares of its common stock, par value $ 0.0001 per share, having an aggregate gross sales price of up to $ 50 million, to or through the Ascendiant.

7 unchanged sentences

The Company and the Ascendiant may each terminate the Sales Agreement at any time upon specified prior written notice.

For the three months ended March 31, 2025, the Company sold an aggregate of 9,719,173 shares of its common stock pursuant to the Sales Agreement, resulting in net proceeds of approximately $ 9.7 million, after deducting underwriting discounts.

As of March 31, 2025, the Sales Agreement has been fully utilized and terminated.

The Sales Agreement was fully utilized and terminated on March 31, 2025.

For the three months ended June 30, 2025 and 2024, the amount of proceeds generated from the sale of common stock under the Sales Agreement was $ 0.0 and $ 27.7 million from the sale of 0 and 1,062,821 shares, respectively.

For the six months ended June 30, 2025 and June 30, 2024, the Company sold an aggregate of 9,719,173 shares of its common stock pursuant to the Sales Agreement, resulting in net proceeds of $ 9.7 million, and $ 27.7 million from the sale of 1,062,821 shares, respectively.

Equity Incentive Plan

5 unchanged sentences

In January 2025, Board approved a 5 % increase to the authorized shares in the 2021 Incentive Plan from 353,163 to 717,941 .

Total shares available for the issuance of stock-based awards under the Company’s 2021 Incentive Plan was 0 shares at March 31, 2025.

Total shares available for the issuance of stock-based awards under the Company’s 2021 Incentive Plan was 0 shares at June 30, 2025.

Stock-based compensation expense has been reported in the Company’s condensed consolidated statements of operations as follows:

Three Months Ended

Six Months Ended

($ in thousands)

2 unchanged sentences

General and administrative

89 14 162 ( 3 )

Total stock-based compensation expense

1 unchanged sentence

Restricted Stock Units

The following table summarizes the restricted stock unit activity during the three months ended March 31, 2025:

The following table summarizes the restricted stock unit activity during the six months ended June 30, 2025:

Average Grant

3 unchanged sentences

570,671 $ 1.01

Unvested balance at March 31, 2025

Unvested balance at June 30, 2025

744,709 $ 1.32

At March 31, 2025, the Company had unrecognized stock-based compensation expense related to restricted stock awards of $ 0.8 million, which is expected to be recognized over the remaining weighted-average vesting period of 1.8 years.

At June 30, 2025, the Company had unrecognized stock-based compensation expense related to restricted stock awards of $ 0.65 million, which is expected to be recognized over the remaining weighted-average vesting period of 1.5 years.

The expense is recognized over the vesting period of the award.

Stock Options

The following table summarizes stock option activity during the three months ended March 31, 2025:

The following table summarizes stock option activity during the six months ended June 30, 2025:

Intrinsic Value

3 unchanged sentences

75,000 1.01 9.5 —

Outstanding at March 31, 2025

( 25,000 ) 1.01 9.5 —

Expected to vest

Outstanding at June 30, 2025

50,000 $ 1.01 9.5 $ —

The aggregate intrinsic value of options is calculated as the difference between the exercise price of the underlying options and the fair value of the Company’s common stock for those options that had exercise prices lower than the fair value of the Company’s common stock.

As of March 31, 2025, the total compensation cost related to non-vested options awards not yet recognized is approximately $ 46,000 with a weighted average remaining vesting period of 0.8 years.

As of June 30, 2025, the total compensation cost related to non-vested options awards not yet recognized is $ 21,531 with a weighted average remaining vesting period of 0.5 years.

The Company estimated the fair value of stock options granted in the period presented using a Black-Scholes option-pricing model utilizing the following assumptions:

For the Three Months Ended

As of June 30,

Expected term (in years)

1 unchanged sentence

Expected dividend yield

Escrow Arrangements

As of March 31, 2025, the Company held $ 2.5 million in an escrow account for payment to the SEC.

These funds were disbursed on April 2, 2025 to satisfy the SEC settlement.

The escrow balance is included in “Current Liabilities” on the balance sheet, with corresponding restricted cash reported under “Current Assets.”

License and Development Agreements

3 unchanged sentences

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, 2025 , the liability is recorded as a current liability on the Company’s condensed unaudited consolidated balance sheets as follows:

As of June 30, 2025 , the liability is recorded as a current liability on the Company’s condensed unaudited consolidated balance sheets as follows:

$ 3.6 million in accounts payable, $ 1.4 million convertible promissory notes and accrued interest, net of debt discount, and $ 0.4 million in accrued liabilities.

4 unchanged sentences

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:

As of March 31,

Three and Six Months Ended June 30,

Unvested restricted stock units

Series A Convertible Preferred stock

Convertible debt

Financial Instruments

The following tables present information about the Company’s financial instruments measured at fair value on a recurring basis and indicate the level of the fair value hierarchy used to determine such fair values:

Fair Value Measurements as of March 31, 2025

($ in thousands)

Warrant derivative liability

Fair Value Measurements as of December 31, 2024

($ in thousands)

Warrant derivative liability

Methods used to estimate the fair values of the Company’s 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 described in Note 5.

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 to occur.

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 three months ended March 31, 2025 and 2024 .

803,266 8,557

Commitments and Contingencies

4 unchanged sentences

The Wells Notice related 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.

On March 13, 2025, the Company issued a press release announcing that the Company had reached a final settlement with the SEC relating to the Company’s previously disclosed SEC investigation, and as part of the settlement, the Company had agreed to pay a one -time civil penalty of $ 2.5 million.

On March 13, 2025, the Company issued a press release announcing that the Company had reached a final settlement with the SEC relating to the Company’s previously disclosed SEC investigation, and as part of the settlement, the Company agreed to pay a one -time civil penalty of $ 2.5 million.

The Company made a cash payment of $ 2.5 million to the SEC on April 2, 2025.

On September 13, 2024, a purported class action captioned Osman Mukeljic v.

Allarity Therapeutics, Inc., et al , 1:24 -cv- 06952, was filed in the United States District Court for the Southern District of New York against the Company and certain of its current and former officers.

On February 26, 2025, the Company issued a press release announcing the dismissal of the aforementioned class action lawsuit.

Subsequent Events

Share Buyback

Subsequent to the three months ended March 31, 2025, from April 17, 2025 through May 6, 2025, the Company repurchased 1,995,766 shares of its common stock under its share repurchase program.

The average cost per share was $ 1.07 , including broker commissions but excluding federal excise tax, for a total value of $ 2.1 million.

As of May 8, 2025, the Company had $ 2.9 million of availability remaining under its existing share repurchase program.

Appointment of Executive Officer

On July 1, 2025, Jeffrey S.

Ervin was appointed as Chief Financial Officer of the Company after the June 30, 2025 resignation of Alexander Epshinsky.

Epshinsky's departure was not the result of any disagreement with the Company regarding its operations, policies or practices, including accounting principles, practices or disclosures.

Allarity DRP Partnership

On July 15, 2025, the Company announced a new commercial agreement with a non-disclosed EU-based biotechnology company.

The agreement provides the partner with a non-exclusive global license to a range of selected proprietary Allarity DRP® algorithms in breast cancer, alongside laboratory services from Allarity’s Medical Laboratory in Denmark.

Management ’ s Discussion and Analysis of Financial Condition and Results of Operations.

14 unchanged sentences

Recent Developments

On March 19, 2024, we entered into an At-The-Market Issuance Sales Agreement, as amended (the “Sales Agreement”) with Ascendiant Capital Markets, LLC (“Ascendiant”) under which we may offer and sell, from time to time at our sole discretion, shares of our common stock, par value $0.0001 per share, having an aggregate gross sales price of up to $50 million, to or through the Ascendiant.

The offer and sales of the shares are made pursuant to a previously filed shelf registration statement on Form S-3 (File No.

333-275282), originally filed with the Securities and Exchange Commission (the “SEC”) on November 2, 2023 and declared effective on November 29, 2023, and the related prospectus supplement dated September 9, 2024 and filed with the SEC on such date.

We will pay the Ascendiant a commission of 3.0% of the gross proceeds from the sales of shares sold through Ascendiant under the Sales Agreement.

We will also reimburse the Ascendiant for certain expenses incurred in connection with the Sales Agreement.

Both we and Ascendiant may each terminate the Sales Agreement at any time upon specified prior written notice.

For the three months ended March 31, 2025, we sold an aggregate of 9,719,173 shares of our common stock pursuant to the Sales Agreement, resulting in net proceeds of approximately $9.7 million after deducting underwriting discounts.

SEC Investigation

Share Repurchase Plan

On March 3, 2025, the board of directors approved a share repurchase program, with authorization to purchase up to $5 million of the Company’s outstanding shares of common stock.

For the three months ended June 30, 2025, the Company repurchased 2,455,702 shares for an aggregate cost of $2,565,511, inclusive of all transaction fees.

For the six months ended June 30, 2025 and 2024, the total proceeds used to repurchase shares were $2,565,511 and $0, respectively.

As of June 30, 2025, there is $2,434,489 remaining for share repurchases under the share repurchase program.

SEC Investigation Settlement

On July 19, 2024, we received a “Wells Notice” from the Staff of the SEC relating to our previously disclosed SEC investigation.

4 unchanged sentences

The Wells Notice informed us that the SEC Staff has made a preliminary determination to recommend that the SEC file an enforcement action against us that would allege certain violations of the federal securities laws.

On March 13, 2025, we issued a press release that we have reached a final settlement with the SEC relating to our previously disclosed SEC investigation, and as part of the settlement, we have agreed to pay a one-time civil penalty of $2.5 million.

On September 13, 2024, a purported class action captioned Osman Mukeljic v.

Allarity Therapeutics, Inc., et al , 1:24-cv-06952, was filed in the United States District Court for the Southern District of New York against us and certain of our current and former officers.

The complaint alleged, among other things, that defendants made false and misleading statements and/or failed to disclose information related to Dovitinib NDA’s continued regulatory prospects and purported misconduct in connection with the Dovitinib NDA and/or the Dovitinib-DRP PMA.

The complaint asserted violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder against all defendants as well as violations of Section 20(a) of the Exchange Act against the individual defendants.

On February 26, 2025, we issued a press release announcing the dismissal of this class action lawsuit.

Reverse Stock Splits

On April 9, 2024 and September 11, 2024, we effected a 1-for-20 reverse stock split and 1-for-30 reverse stock split, respectively, of our shares of common stock (collectively, the “Reverse Stock Splits”).

All share and per share information has been retroactively adjusted to give effect to the Reverse Stock Splits for all periods presented.

Proportionate adjustments were made to the per share exercise price and/or the number of shares issuable upon the exercise or vesting of all stock options, restricted stock, preferred stock and warrants outstanding on September 12, 2024, which resulted in a proportional decrease in the number of shares of our common stock reserved for issuance upon exercise or vesting of such stock options, restricted stock and warrants, and, in the case of stock options and warrants, a proportional increase in the exercise price of all such stock options and warrants.

No fractional shares were issued in connection with the Reverse Stock Splits.

If, as a result of the Reverse Stock Splits, a stockholder would otherwise have been entitled to a fractional share, each fractional share was rounded up to the next whole number.

On March 13, 2025, we issued a press release that we reached a final settlement with the SEC relating to our previously disclosed SEC investigation.

As part of the settlement, we agreed to and paid a one-time civil penalty of $2.5 million on April 2, 2025.

Changes in Leadership

On June 10, 2025, the Board appointed Mr.

Jesper Høiland as a director of the Company, effective as of June 30, 2025.

This follows the resignation of Joseph W.

Vazzano on June 5, 2025, and effective June 30, 2025.

On July 1, 2025, Jeffrey S.

Ervin was appointed to the office of Chief Financial Officer of the Company, replacing Alexander Epshinsky upon his resignation on June 30, 2025.

Advancement in Intellectual Property

On June 30, 2025, the Company announced that IP Australia, the Australian Government agency that administers intellectual property rights in the country, formally accepted the Company’s patent application for its DRP® companion diagnostic specific to stenoparib.

The acceptance covers 40 claims and marks a key step in Allarity’s global strategy to protect the potential international commercialization of its proprietary DRP® platform alongside the clinical development of stenoparib.

Risks and Uncertainties

3 unchanged sentences

Recently Issued Accounting Pronouncements

See Note 2, “Summary of Significant Accounting Policies”, to our unaudited condensed consolidated financial statements contained in Part I, Item 1 of this Quarterly Report on Form 10-Q for a discussion of recent accounting pronouncements.

See Note 2, “Summary of Significant Accounting Policies”, to our unaudited condensed consolidated financial statements contained in Part I, Item 1 of this Quarterly Report for a discussion of recent accounting pronouncements.

Financial Operations Overview

3 unchanged sentences

We have incurred net losses in each year since inception.

Our net losses were $2.7 million and $3.8 million for the three months ended March 31, 2025 and 2024, respectively.

As of March 31, 2025, we had an accumulated deficit of $121.7 million and cash, cash equivalents and restricted cash of $27.7 million.

Our net losses were $5.1 million and $5.5 million for the six months ended June 30, 2025 and 2024, respectively.

As of June 30, 2025, we had an accumulated deficit of $124.0 million and cash and cash equivalents of $17.8 million.

Substantially all our net losses have resulted from costs incurred in connection with our research and development programs and from general and administrative costs associated with our operations.

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Results of Operations

Comparison of the Three Months Ended March 31, 2025 and 2024 (unaudited)

Comparison of the Three and Six Months Ended June 30, 2025 and 2024 (unaudited)

Three Months Ended

Six Months Ended

($ in thousands)

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Interest expense

Foreign exchange gains

Foreign exchange gains (losses)

Change in fair value of derivative and warrant liabilities

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Research and Development Expenses

For the three months ended March 31, 2025, compared to March 31, 2024

The decrease of $0.8 million in research and development expenses was primarily related to a reduction of $1.0 million in manufacturing and supplies, $0.2 million in contractor and consultant expenses and $0.2 million in milestone payments, partially offset by an increase of $0.4 million in staffing costs including non-cash stock-based compensation and $0.2 million increase in the tax credit.

For the three months ended June 30, 2025, compared to June 30, 2024

The increase of $1.3 million in research and development expenses was primarily related to a $1.0 million cost in manufacturing and supplies needed for the expansion of the Phase II clinical trial of stenoparib.

These expenses are recognized at the time of purchase.

Additional research study costs made up the remaining $0.2 million.

For the six months ended June 30, 2025, compared to June 30, 2024

Research and development expenses increased over $0.5 million with the expansion of the Phase II clinical trial to accelerate development of stenoparib in Advanced Ovarian Cancer.

The increase in research and development expenses was primarily related to an increase in regulatory costs $0.2 million, clinical site fees $0.1 million, and staff and consultant increases $0.2 million.

General and Administrative Expenses

For the three months ended March 31, 2025, compared to March 31, 2024

General and administrative expenses decreased by $0.4 million for the three months ended March 31, 2025, compared to March 31, 2024.

The decrease was primarily due to decreases of $0.5 million in professional services and $0.1 million in staffing costs including non-cash stock-based compensation, partially offset by an increase of $0.2 million in other administrative and corporate expenses.

For the three months ended June 30, 2025, compared to June 30, 2024

General and administrative expenses decreased by $0.5 million for the three months ended June 30, 2025, compared to June 30, 2024.

The decrease was primarily due to a decrease of $0.8 million in professional services which offset a $0.3 million increase in staffing costs including non-cash stock-based compensation.

For the six months ended June 30, 2025, compared to June 30, 2024

General and administrative expenses decreased by $0.9 million for the six months ended June 30, 2025, compared to June 30, 2024.

The decrease was primarily due to a $1.2 million decrease in professional services and $0.3 million increase in staffing costs including non-cash stock-based compensation.

Other income (expense)

For the three months ended March 31, 2025, compared to March 31, 2024

Other income of $0.3 million recognized during the three months ended March 31, 2025, consisted primarily of $0.2 million in interest income and $0.1 million in foreign exchange gains, partially offset by $0.1 million in interest expenses

Other income of $0.4 million recognized during the three months ended March 31, 2024 consisted primarily of $0.4 million in fair value adjustments to the warrant liabilities and $0.1 million in foreign exchange gains, partially offset by $0.1 million in interest expense.

For the three months ended June 30, 2025, compared to June 30, 2024

There was little difference for the total other income in the comparable three months ended June 30, 2025.

However, interest income improved $0.2 million, interest expense decreased $0.4 million with the retirement of debt in 2024, and the foreign exchange gain amounted to $1.7 million difference.

All of this was offset by a 2024 change in fair value of the derivative and warrant liabilities of $2.2 million during the three months ended June 30, 2024.

For the six months ended June 30, 2025, compared to June 30, 2024

Other income was $2.1 million for the six months ended June 30, 2025, consisting primarily of $1.7 million in foreign exchange gains.

Other income for the six months ended June 30, 2024 was $2.1 million, when $2.7 million was recognized in a change in fair value adjustment of derivative and warrant liabilities.

The remaining difference for the comparable period was the $0.4 million increase of interest income and $0.5 million decrease in interest expense for the six months ended June 30, 2025.

Liquidity, Capital Resources and Plan of Operations

Since our inception through March 31, 2025, our operations have been financed primarily by the sale of convertible promissory notes and the sale and issuance of our securities.

As of March 31, 2025, we had $27.7 million in cash, cash equivalents and restricted cash and an accumulated deficit of $121.7 million.

Since our inception through June 30, 2025, our operations have been financed primarily by the sale of convertible promissory notes and the sale and issuance of our securities.

As of June 30, 2025, we had $17.8 million in cash and cash equivalents and an accumulated deficit of $124.0 million.

Our primary use of cash is to fund operating expenses, which consist of research and development as well as regulatory expenses clinical programs for stenoparib, and to a lesser extent, general and administrative expenses.

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On March 21, 2024, we commenced an at the market offering of shares of our common stock.

During the three months ended March 31, 2025, we had sold 9,719,173 shares of our common stock for net proceeds of $9.7 million.

The at the market offering has been fully utilized and terminated as of March 31, 2025.

We believe that our current cash balance is sufficient to fund operations through at least the next 12 months from the date of this report on Form 10-Q.

During the six months ended June 30, 2025, we sold 9,719,173 shares of our common stock for net proceeds of $9.7 million.

The at-the-market offering was terminated as of March 31, 2025.

We believe that our current cash balance is sufficient to fund operations through at least the next 12 months from the date of this Quarterly Report.

We may need to seek additional capital through the sale of our securities or other sources to carry out all of our planned research and development and potential commercialization activities.

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We have not included these payments in a table of contractual obligations since these contracts are generally cancellable at any time by us following a certain period after notice and therefore, we believe that our non-cancellable obligations under these agreements are not material.

Three Months Ended

Six Months Ended

($ in thousands)

Total cash, cash equivalents and restricted cash provided by (used in):

Total cash and cash equivalents provided by (used in):

Operating activities, net

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Effect of foreign exchange rates on cash

Net increase in cash, cash equivalents and restricted cash

Net increase in cash and cash equivalents

Operating Activities

Net cash and cash equivalents used in operating activities was $2.7 million for the three months ended March 31, 2025, primarily comprised of our $2.7 million net loss and $0.2 million increase in operating assets and liabilities, partially offset by $0.1 million in share based compensation, and $0.1 million in non-cash interest expense,

Net cash and cash equivalents used in operating activities was $1.4 million for the three months ended March 31, 2024, primarily comprised of our $3.8 million net loss, $0.4 million change in fair value of warrant liabilities, and $0.1 million in non-cash interest expense, partially offset by a $2.9 million decrease in operating assets and liabilities.

Net cash and cash equivalents used in operating activities was $8.2 million for the six months ended June 30, 2025, primarily due to a $2.5 million settlement payment to the Securities and Exchange Commission.

The remaining amount was used for working capital purposes and expansion costs to launch a Phase II Clinical Trial of stenoparib in advanced ovarian cancer.

Net cash and cash equivalents used in operating activities was $8.7 million for the six months ended June 30, 2024, primarily comprised of working capital.

Financing Activities

Net cash and cash equivalents provided by financing activities was $11.1 million for the three months ended March 31, 2025, due to $11.1 million in net proceeds from the sale of common stock pursuant to the Sales Agreement.

Net cash and cash equivalents provided by financing activities was $1.4 million for the three months ended March 31, 2024, primarily due to $1.4 million in net proceeds from the sale of 2024 Notes to 3i.

Net cash and cash equivalents provided by financing activities was $8.6 million for the six months ended June 30, 2025.

The Company received an outstanding ATM receivable balance of $1.4 million in addition to the sale of 9,719,173 shares of our common stock for net proceeds of $9.7 million.

However, the Company repurchased 2,455,702 common shares as part of a share repurchase program for $2.6 million.

Net cash and cash equivalents provided by financing activities was $27.7 million for the six months ended June 30, 2024, due to net proceeds from the sale of 1,062,821 shares of stock.

Operating Capital and Capital Expenditure Requirements

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Critical Accounting Policies and Use of Estimates

Our management’s discussion and analysis of financial condition and results of operations is based upon our unaudited condensed interim consolidated financial statements for the three months ended March 31, 2025 and 2024, and our audited consolidated financial statements for the years ended December 31, 2024 and 2023, which have been prepared in accordance with U.S.

Our management’s discussion and analysis of financial condition and results of operations is based upon our unaudited condensed interim consolidated financial statements for the three and six months ended June 30, 2025 and 2024, and our audited consolidated financial statements for the years ended December 31, 2024 and 2023, which have been prepared in accordance with U.S.

The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, and expenses.

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Actual results may differ from these estimates under different assumptions and conditions.

Our significant accounting policies are described in the notes to our consolidated financial statements for the year ended December 31, 2024 included in the Form 10-K, and there have been no significant changes to our significant accounting policies during the three months ended March 31, 2025.

These unaudited condensed interim consolidated financial statements should be read in conjunction with our audited financial statements and accompanying notes.

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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