What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2026-03-16 compared with 2025-03-31 · 724 added, 793 removed, 436 unchanged (78% of the section changed)

We develop proprietary noninvasive diagnostics to detect early-stage lung

cancer and other diseases of the lung using flow cytometry and automated analysis developed by machine learning, a form of artificial

intelligence (“AI”).

Our diagnostic tests analyze cell populations, including cancer and cancer-related cells, that are indicative

of a specific diseased state.

We were formed as a Delaware corporation on March 26, 2014.

2016, we formed OncoSelect ® Therapeutics, LLC (“OncoSelect ® ”) , a Delaware limited liability

company and our wholly owned subsidiary which is a preclinical-stage biopharmaceutical discovery company that has advanced our discoveries

of novel potential cancer therapies that specifically and selectively target a broad spectrum of cancer cells that have been grown in

petri dishes without harm to healthy cells.

We expect to present our findings at conferences and publish the results of our research this

year and seek strategic partners that have the resources to advance our therapeutic discoveries.

August 14, 2023, we formed Precision Pathology Laboratory Services, LLC (“PPLS”), a Texas limited liability company and our

wholly owned subsidiary, which performs our clinical laboratory services, including CyPath ® Lung operations.

and optimization of our platform technologies for in vitro diagnostics and therapeutic technologies are conducted in laboratories at

The University of Texas at San Antonio and PPLS in San Antonio, Texas.

In September 2023, through our wholly owned subsidiary PPLS, we acquired

the assets of Village Oaks Pathology Services, P.A.

(“Village Oaks”), a Texas professional association d/b/a Precision Pathology

Services, including a clinical anatomic and clinical pathology laboratory and related services business in San Antonio, Texas.

The laboratory

is accredited by the College of American Pathologists (“CAP”) and certified under the Clinical Laboratory Improvement Amendments

of 1988 (“CLIA”).

first diagnostic test, CyPath ® Lung, addresses the need for noninvasive detection of early-stage lung cancer.

is the leading cause of cancer-related deaths worldwide.

Physicians order CyPath ® Lung to assist in their assessment and

care of patients who are at high risk for lung cancer.

The CyPath ® Lung test enables physicians to more confidently identify

patients who will likely benefit from timely intervention and more invasive follow-up procedures and those who are likely without lung

cancer and should continue routine screening.

CyPath ® Lung has the potential to increase overall diagnostic accuracy of

lung cancer, which could lead to increased survival, fewer unnecessary invasive procedures, reduced patient anxiety, and lower medical

Lung uses flow cytometry technology to detect and analyze cell populations in a person’s sputum, or phlegm, to find characteristics

indicative of lung cancer, including cancer and/or cancer-related cells that have shed from a lung tumor.

The flow cytometer is a well-established

instrument used in many commercial laboratories.

Flow cytometry collects data pertaining to properties of single cells labeled with antibodies

and dyes specific to cell types and characteristics.

Sputum is an excellent sample for analysis because it is in direct contact with

any malignancy in the lungs and can provide information about its area of field cancerization and the lung microenvironment.

Lung uses automated data analysis developed by machine learning, a form of AI, that allows data collection and analysis of an entire

sample of sputum in less than 30 minutes, allowing for cost-effective, large-scale commercialization.

conducted a 150-patient test validation trial of people at high risk for lung cancer including patients with the disease (N=28) and those

who were cancer-free (N=122) that resulted in CyPath ® Lung’s overall 88% specificity, meaning the ability to correctly

identify a person without cancer, and 82% sensitivity, meaning the ability to correctly identify cancer in a person with the disease.

CyPath ® Lung correctly detected 80% of Stage I lung cancers.

The test detected multiple lung cancer types including non-small

cell, small cell, adenocarcinoma, squamous, and large cell cancers.

For the subset of patients in this trial who had lung nodules 20

millimeters (“mm”) or smaller, this trial resulted in 92% sensitivity, 87% specificity, 99% negative predictive value, and

88% accuracy.

In this subset of 132 individuals with small nodules, 119 patients were cancer-free and 13 had confirmed lung cancer.

detection of small lung nodules in people who have early-stage cancer can increase lung cancer survival.

develop noninvasive diagnostic laboratory tests to detect early-stage lung cancer and other diseases of the lung using flow cytometry

and automated analysis informed by machine learning, a form of artificial intelligence (AI).

Our first commercial diagnostic test,

CyPath ® Lung, identifies and analyzes cell populations using flow cytometry, including cancer and cancer-related cells,

that indicate a malignancy in the lung.

Lung addresses the need for noninvasive detection of early-stage lung cancer with the proven ability to detect the leading cancer

killer at its curative Stage 1A.

Lung cancer is the leading cause of cancer-related deaths worldwide.

Physicians order

CyPath ® Lung to assist in their assessment of patients who are at high risk for lung cancer.

CyPath ® Lung test enables physicians to more confidently identify patients who will likely benefit from timely

intervention and more invasive follow-up procedures or those patients who are likely without lung cancer and should continue

screening in accordance with guidelines.

For patients with small pulmonary nodules less than 20 millimeters (mm),

CyPath ® Lung has shown 92% sensitivity and 87% specificity with 88% accuracy in a clinical trial, offering the

potential to increase the overall diagnostic accuracy of lung cancer testing, which could lead to increased survival, fewer

unnecessary invasive procedures, reduced patient anxiety, and lower medical costs.

Lung is performed and offered by our wholly owned subsidiary PPLS, a clinical anatomic and pathology laboratory which we acquired by

purchasing the assets of Village Oaks Pathology Services, P.A., a Texas professional association.

PPLS is a CAP-accredited and CLIA-certified

commercial laboratory that has been in operation for more than 18 years.

addition to CyPath ® Lung, we are advancing development of our flow cytometry+AI platform for companion diagnostic

tests targeted at asthma and chronic obstructive pulmonary disease (“COPD”).

Diagnostics under development are designed

to quantify the extent and type of inflammation in the lung associated with disease and further detect specific receptors in sputum

that may determine the effectiveness of new and emerging therapies for asthma and COPD that have proved to effectively treat

specific types of inflammation.

Therapeutics for these lung diseases that are on the market or in development can help some but not

all patients, and often it is unknown before use whether a drug will be effective.

Our tests in development are designed to help

determine the most effective use of new and emerging therapies for asthma and COPD and lessen the need for a trial-and-error

approach to proscribing treatment.

our wholly owned subsidiary, OncoSelect ® Therapeutics, LLC, we have conducted research that has led to discoveries and

advancement of novel cancer therapeutic approaches that specifically and selectively target cancer cells.

We continue to advance research

and development for use of this technology for topical treatment of squamous cell skin cancer.

We expect to present our findings at conferences

and publish our research in peer-reviewed journals in the near future.

We intend to seek strategic partners to develop our therapeutic

discoveries which could result in broad-spectrum cancer treatments in the future.

and optimization of our platform technologies are conducted in laboratories at our wholly owned subsidiary PPLS and leased

laboratory space at The University of Texas at San Antonio (UTSA).

UTSA provided notice in January 2026 that our lease would not be

renewed, and as a result we will relocate our research operations from UTSA to privately owned laboratory space.

Year Financial Highlights

financial results for the year ended December 31, 2025, include:

revenue increased approximately 270% to $9.4 million as compared to $2.5 million for the year ended December 31, 2023, primarily as

a result of the acquisition of PPLS in September 2023.

CyPath ® Lung testing revenue increased approximately 1,400%

to $0.5 million as compared to $35 thousand for the year ended December 31, 2023, due to an increase in total test results delivered of

more than 600 for the current year.

as a result of the Company’s targeted strategic actions to discontinue unprofitable pathology services, reduce costs through operational

efficiency, and drive sales growth for CyPath ® Lung, consolidated revenue decreased approximately 34% to $6.2 million

as compared to $9.4 million for the year ended December 31, 2024.

While these actions contributed to lower consolidated revenue in the

short term, they improved operating focus and cost structure and are intended to position our noninvasive lung cancer diagnostic for

scalable growth and improved long-term margin potential.

Lung testing revenue increased approximately 87% to $963,000 as compared to $516,000 for the year ended December 31, 2024, due to

a 99% increase for a total of more than 1,200 test results delivered for the current year.

approximately $16.9 million in gross proceeds from equity transactions to fund operating activities.

Pivotal Study

March 2025, we submitted our pivotal clinical trial protocol “Detection of Early-Stage Lung Cancer in Sputum using Flow

Cytometry and an Automated Analysis Pipeline” to the Sterling Institutional Review Board (“IRB”) for approval

after the Company meet met with the FDA on trial design.

In third quarter 2024, the National Association of Veterans Research and

Education Foundation (“NAVREF”) extended a “Call for Interest” to Veterans Administration (“VA”) systems to solicit participation in the

pivotal trial, which resulted in a positive response from 22 VA medical centers.

Academic, private, military, and VA centers currently are being qualified as collection sites for the

3,200-patient clinical trial expected to open in the second quarter of 2025.

March 2025, we announced the release of physicians’ case studies showing the benefit to patients and their doctors of using CyPath ®

Lung, including one case in which an “Unlikely Lung Cancer” directly prevented a robotic bronchoscopic biopsy or high-risk

percutaneous biopsy in a high-risk patient in response to imaging that showed several new, small non-calcified pulmonary nodules for

a high-risk patient.

In a second case study, a positive CyPath ® Lung test result led to diagnosis of a recurrence of breast

cancer, and a third case resulted in the diagnosis of a new primary lung cancer after a CyPath ® Lung positive test that

prompted a biopsy that otherwise would not have been performed.

Strategic Actions

March 2025, we announced targeted strategic actions to improve financial

performance and accelerate the commercial growth of CyPath ® Lung, taking steps to deliver approximately $4 million in annual

cost savings at our subsidiary PPLS, while increasing resources to expand CyPath® Lung sales in high-potential national markets.

Specifically,

cost savings are a result of labor cost reductions, operational efficiency enhancements, and discontinuing certain pathology services

with suboptimal profit margins to focus on high-margin services such as CyPath ® Lung and by discontinuing certain pathology

services with suboptimal profit margins.

of Department of Defense Research

in the fourth quarter of 2023 and through 2024, we have been selling CyPath ® Lung tests to the Department of Defense (DOD)

to conduct an observational study, “Detection of Abnormal Respiratory Cell Populations in Lung Cancer Screening Patients Using

the CyPath ® Lung Assay,” and for research and development on using bronchoalveolar lavage fluid as a biological

sample to assess cardiopulmonary function and exercise performance in military personnel post COVID-19 infection.

Start of Our Longitudinal Clinical Study

In March 2026, we enrolled our first patient in our clinical trial entitled “Detection of Early-Stage Lung Cancer in Sputum using Flow

Cytometry and an Automated Analysis Pipeline” (NCT07168993).

Murtha Cancer Center Research Program (MCCRP), a research program

within the Department of Surgery at the Uniformed Services University of the Health Sciences in Bethesda, Maryland, is providing support

and funding associated with the trial at three collection sites – Brooke Army Medical Center in San Antonio, Texas, Walter Reed

Medical Center in Bethesda, Maryland, and the South Texas Audie L.

Murphy Memorial Veterans Medical Center.

The approved trial protocol calls for enrollment

of up to 2,063 patients at 17 VA, military, academic and private medical centers who are at high risk for lung cancer with one or

more indeterminate pulmonary nodules between 6 mm to less than 30 mm.

Patients enrolled in the trial will be followed until the

patient receives either a diagnosis of cancer or noncancer, with patients followed up to two years.

The clinical trial will evaluate

the clinical performance of the test as a sensitive and specific noninvasive diagnostic to identify the presence of lung cancer in

high-risk individuals who have indeterminate pulmonary nodules as determined by CT imaging.

To differentiate the investigational use

of our CyPath ® Lung test that is offered for commercial sale and use, we use the name “FlowPath tm

Lung” in protocol documents and on collection kits provided to sites.

of Research Studies with the Military

the sale of tests to Brooke Army Medical Center (“BAMC”) beginning in the fourth quarter of 2023 and through 2024 as

part of an observational study, we began a collaboration with BAMC in the fourth quarter 2025 to collect and validate the clinical

utility of using CyPath ® Lung to analyze sputum samples obtained by tracheal and bronchial suctioning for early

detection of lung cancer.

Bronchoscopy is used commonly in the United States, with approximately 500,000 procedures performed

The CyPath ® Lung study with BAMC will explore an approach that could expand the utility of

bronchoscopy-collected samples for earlier, noninvasive lung cancer detection.

the first quarter of 2026, we began a research collaboration with BAMC to advance the development of companion diagnostic tests

targeted at asthma and COPD.

The initial research study is designed to quantify the extent and type of inflammation in the lung

associated with disease and further determine the ability of our diagnostic platform to detect specific receptors in sputum that

determine the effectiveness of new and emerging therapies for asthma and COPD that have been proved to effectively treat specific

types of inflammation.

Positive Research Findings Advance Company’s

Pipeline Tests for Asthma

In March 2026, the Company presented positive research

findings for its platform technology’s ability to identify antibody drug receptors in sputum, including receptors for dupilumab,

a leading therapy for asthma and chronic obstructive pulmonary disease (“COPD”), and benralizumab, another asthma therapy.

The research, presented at the American Academy of Allergy, Asthma and Immunology’s annual conference, advances the Company’s

pipeline tests aimed at guiding personalized treatment decisions and improving disease monitoring for asthma and COPD sufferers.

Appointment of Nationally Recognized Lung Cancer

Authorities to its Medical and Scientific Advisory Board

In February 2026, we announced the appointment of

David Ost, MD, MPH, Chief of Pulmonary, Critical Care and Sleep Medicine at the University of Texas MD Anderson Cancer Center, Daniel

Sterman, MD, Chief of the Division of Pulmonary, Critical Care and Sleep Medicine at New York University Langone Medical Center, and J.

Scott Ferguson, MD, Director of Interventional Pulmonology at the University of Wisconsin School of Medicine and Public Health, to our

Medical and Science Advisory Board that includes recognized leaders in the field of lung cancer.

New Patient Case Studies Add to Real-World Evidence

of CyPath ® Lung Reducing Diagnostic Burden

In February 2026, we announced two additional patient

case studies where a CyPath ® Lung result of “Unlikely Malignancy” relieved patient anxiety and supported the

physician’s decision to continue repeat imaging rather than subjecting patients to invasive, risky and costly biopsies.

studies add to a growing number of reported cases where CyPath ® Lung has made a decisive positive impact on patient care.

PPLS Continues to Meet Highest Standards for

Laboratory Operations

In January 2026, we announced that PPLS maintained

its accreditation across all laboratory service lines from the College of American Pathologists (CAP), considered the gold standard for

CAP accreditation signifies that a laboratory meets high standards of quality, accuracy and patient safety through comprehensive

peer-based inspections conducted every two years.

and Private Offerings

February 26, 2025, pursuant to the terms of a warrant inducement agreement (the “February Inducement Agreement”), dated

February 25, 2025 that we entered into with certain holders of existing warrants, such holders exercised for cash (i) warrants to

purchase an aggregate of up to 1,302,082 shares of Common Stock issued on October 21, 2024 (the “October Warrants”), at

the reduced exercise price of $0.58 per share, and (ii) warrants to purchase an aggregate of up to 1,136,391 shares of Common Stock

issued on August 5, 2024 (the “August Warrants”), at the reduced exercise price of $0.58 per share.

aggregate gross proceeds of approximately $1.4 million, before deducting advisory fees and other expenses payable by us.

consideration of the immediate exercise of the October Warrants and August Warrants by the holders thereof in accordance with the

February Inducement Agreement, we issued unregistered common warrants to purchase an aggregate of up to 2,926,166 shares of Common

Stock (120% of the number of shares of Common Stock issuable upon exercise of the October Warrants and August Warrants) to such

October 21, 2024, we issued to certain institutional investors (i) in a registered direct offering, 2,048,294 shares of our Common Stock,

and (ii) in a concurrent private placement, common warrants to purchase an aggregate of 2,662,782 shares of Common Stock, with an exercise

price of $1.50, pursuant to a securities purchase agreement, dated October 18, 2024, that we entered into with such institutional investors,

and received aggregate gross proceeds from the offerings of approximately $2.7 million, before deducting placement agent fees and other

offering expenses payable by us.

October 2025, we entered into definitive agreements for the purchase and sale of 720,000 shares of common stock, par value $0.007 per

share, at a purchase price of $2.50 per share in a registered direct offering priced at-the-market under Nasdaq rules.

The gross proceeds

from the offering were approximately $1.8 million before deducting placement agent fees and other offering expenses payable by us.

September 29, 2025, we consummated a best efforts public offering of an aggregate of (i) 1,047,694 shares of Common Stock and (ii) pre-funded

warrants to purchase up to 874,067 shares of Common Stock in lieu of shares of Common Stock.

Each share was sold at a public offering

price of $2.50.

Each pre-funded warrant was sold at a public offering price of $2.493.

The total gross proceeds for the transaction were

approximately $4.8 million.

August 13, 2025, we entered into a securities purchase agreement with certain institutional and accredited investors, pursuant to which

the Company agreed to issue and sell in a private placement (i) 990 shares of our newly designated Series B Convertible Preferred Stock,

with a par value $0.001 per share and stated value of $1,000 per share, for gross proceeds to us of $990,000, which were initially convertible

into 143,476 shares of our Common Stock at an initial conversion price of $6.90 per share and (ii) warrants to purchase up to 223,824

shares of our Common Stock at an exercise price of $10.56 per share of Common Stock.

May 7, 2025, we completed a public offering of securities for gross proceeds of $3.25 million, before deducting agent fees and other

estimated expenses payable by us.

The offering consisted of 338,541 shares of our Common Stock, of which 79,044 were pre-funded warrants,

together with warrants to purchase up to 507,812 shares of Common Stock, at a combined offering price for each share of Common Stock

(or pre-funded warrant) and accompanying warrant of $9.60 per share.

The warrants have an exercise price of $10.56 per share and have

certain provisions that allow for additional shares to be issued in the event of a reverse split of Common Stock.

Additionally, the

warrants include an anti-dilution adjustment which is subject to stockholder approval.

February 26, 2025, pursuant to the terms of a warrant inducement agreement (the “February Inducement Agreement”), we entered

into with certain holders of existing warrants dated February 25, 2025, such holders exercised for cash (i) warrants to purchase an aggregate

of up to 43,402 shares of Common Stock issued on August 5, 2024 (the “August Warrants”), at the reduced exercise price

of $17.40 per share, and (ii) warrants to purchase an aggregate of up to 37,878 shares of Common Stock issued on October 21, 2024 (the

“October Warrants”), at the reduced exercise price of $17.40 per share.

We received aggregate gross proceeds of approximately

$1.4 million, before deducting advisory fees and other expenses payable by it.

In consideration of the immediate exercise of the October

Warrants and August Warrants by the holders thereof in accordance with the February Inducement Agreement, we issued unregistered common

warrants to purchase an aggregate of up to 97,538 shares of Common Stock (120% of the number of shares of Common Stock issuable upon

exercise of the October Warrants and August Warrants) to such holders.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a more detailed discussion

4 unchanged sentences

A Cancer Journal for Clinicians .

Epidemiology reports that lung cancer is the leading cause of cancer deaths in the European Union with an estimated 17 to 34 million

people at high risk.

China reported 1,060,600 new cases of lung cancer in 2022.

According to the American Lung Association (“ALA”),

screening for individuals at high risk for lung cancer has the potential to improve lung cancer survival rates by finding disease at

an earlier stage when it is more likely to be curable.

An estimated 19.3 million Americans should have annual screening for lung

cancer, according to American Cancer Society recommendations.

A study published in the New England Journal of Medicine titled

“Survival of patients with stage I lung cancer detected on CT screening” dated October 26, 2006, reported that the survival

rate of individuals with Stage I lung cancer who underwent surgical resection within one month after diagnosis had a ten-year survival

rate of 92%, as compared to the overall five-year survival rate in the U.S.

of 28.4% as reported by the ALA in its 2024 “State

of Lung Cancer” report.

Lung cancer is the leading cause of cancer deaths in the European Union with an estimated 17 to 34 million people at high risk, according

to Cancer Epidemiology.

China reported 1,060,600 cases of lung cancer in 2022.

The American Lung Association (“ALA”)

estimated that screening for individuals at high risk for lung cancer has the potential to improve lung cancer survival rates by finding

disease at an earlier stage when it is more likely to be curable.

An estimated 19.3 million Americans should have annual screening

for lung cancer, according to American Cancer Society recommendations.

A study published in the New England Journal of Medicine

titled “Survival of patients with stage I lung cancer detected on CT screening” dated October 26, 2006, reported that the

survival rate of individuals with Stage I lung cancer who underwent surgical resection within one month after diagnosis had a 10-year

survival rate of 92%, as compared to the current overall five-year survival rate in the U.S.

of 29.7% as reported by the ALA in its 2025

“State of Lung Cancer” report .

Unfortunately, most lung cancer is detected in late stages.

The results of a large national clinical trial

that was reported in the New England Journal of Medicine in an article dated August 4, 2011, titled “Reduced Lung-Cancer

Mortality with Low-Dose Computed Tomographic Screening” showed that screening for lung cancer using low-dose computed tomography

(“LDCT”) resulted in a reduction of the mortality rate by up to 20% as compared to screening by X-ray if LDCT screening is

used by patients at high risk for lung cancer on an annual basis.

Therefore, LDCT scans are recommended for screening of an estimated

14 million Americans who are at high risk for lung cancer.

If half of these high-risk individuals were screened, more than 12,000 lung

cancer deaths could be prevented, according to the ALA.

However, the New England Journal of Medicine article also reported that

LDCT was shown to have a low positive predictive value of less than 4%.

This means that for every 100 people who receive a positive result

from LDCT screening and are suspected of having lung cancer, only four actually have the disease.

A reliable, noninvasive, and cost-effective

diagnostic test can increase diagnosis of early-stage lung cancer while lowering the number of unnecessary and invasive procedures for

patients with a false positive result from LDCT screening.

(A false positive test result indicates that the patient has lung cancer when

he or she does not have the disease.)

Lung is a test for early-stage lung cancer that is designed to meet the need for greater diagnostic certainty.

Based on our internal

analysis, its use in conjunction with LDCT is predicted to improve the positive predictive value (the probability that patients with

a positive LDCT scan truly have the disease) by a factor of five.

Our analysis concludes that improving the positive predictive value

of LDCT with the use of CyPath ® Lung has the potential to subject fewer patients to the stresses of misdiagnosis or unnecessary

diagnostic procedures, such as biopsies, while also reducing healthcare costs.

The results of a large national

clinical trial that was reported in the New England Journal of Medicine in an article dated August 4, 2011, titled “Reduced

Lung-Cancer Mortality with Low-Dose Computed Tomographic Screening” showed that screening for lung cancer using low-dose computed

tomography (“LDCT”) resulted in a reduction of the mortality rate by up to 20% as compared to screening by X-ray if LDCT

screening is used by patients at high risk for lung cancer on an annual basis.

If half of the individuals at high risk were screened,

more than 12,000 lung cancer deaths could be prevented, according to the ALA.

However, the New England Journal of Medicine article

also reported that LDCT was shown to have a low positive predictive value of less than 4%.

This means that for every 100 people who receive

a positive result from LDCT screening and are suspected of having lung cancer, only four actually have the disease.

A reliable, noninvasive,

and cost-effective diagnostic test can increase diagnosis of early-stage lung cancer while lowering the number of unnecessary and invasive

procedures for patients with a false positive result from LDCT screening.

(A false positive test result indicates that the patient has

lung cancer when he or she does not have the disease.)

CyPath ® Lung

is a test for early-stage lung cancer proven to detect curative Stage 1A lung cancer that is designed to meet the need for greater

diagnostic certainty.

Based on our internal analysis, its use in conjunction with LDCT is predicted to improve the positive

predictive value (the probability that patients with a positive LDCT scan truly have the disease) by a factor of five.

concludes that improving the positive predictive value of LDCT with the use of CyPath ® Lung has the potential to

subject fewer patients to the stresses of misdiagnosis or unnecessary diagnostic procedures, such as biopsies, while also reducing

healthcare costs.

Physicians receive a CyPath ® Lung test result within three days of the sample arriving at the

laboratory that identifies patients who should undergo more aggressive follow-up procedures to confirm a suspected lung cancer or

guide and support a physician’s decision to monitor the patient using LDCT or CT imaging.

results of a clinical trial using CyPath ® Lung, “Detection of Early-Stage Lung Cancer in Sputum using Automated

Flow Cytometry and Machine Learning,” published in Respiratory Research on January 21, 2023, reported overall 88% specificity,

meaning the ability to correctly identify a person without cancer, and 82% sensitivity, meaning the ability to correctly identify cancer

in a person with the disease.

For the subset of patients in this trial who had lung nodules 20 millimeters or smaller or no nodules detected

by imaging, this trial resulted in 92% sensitivity, 87% specificity, 99% negative predictive value, and 88% accuracy.

This 150-patient

test validation trial analyzed sputum from people at high risk for lung cancer including patients with the disease (N=28) and those who

were cancer-free (N=122).

In the subset of 132 individuals with small nodules, 119 patients were cancer-free and 13 had confirmed lung

Eight out of 10 (80%) of Stage I tumors were correctly identified.

Sensitivity is the percentage of persons with the disease

– in this case, lung cancer – who are correctly identified by the test.

Specificity is the percentage of persons without

lung cancer who are correctly identified by the test.

The cancer group included all lung cancer types, but mostly squamous cell carcinoma

and adenocarcinoma lung cancer (in near equal numbers), showing that CyPath ® Lung detects all types of lung cancer.

clinical trial results reported an Area Under the Curve (AUC) value of 0.89 for CyPath ® Lung.

AUC value indicates the

ability of a test to distinguish between positive and negative cases.

An AUC value of 0.7 to 0.8 is considered acceptable;

is excellent;

more than 0.9 is outstanding.

In study participants with lung nodules less than 20 mm, the test performed with an AUC value

study authored by two pulmonologists and published in 2024 in the peer-reviewed Journal of Health Economics and Outcomes Research

reported that adding CyPath ® Lung to the standard of care for Medicare patients with a positive lung cancer screening

could have saved an average of $2,773 per patient for total cost savings of $379 million in 2022, while the screening could have

saved an average of $6,460 per patient for all patients with a positive lung cancer screening for a total costs savings of $891

The peer-reviewed study, “Economic Evaluation of a Novel Lung Cancer Diagnostic in a Population of Patients with a

Positive Low-Dose Computed Tomography Result,” attributes the savings to a reduction in follow-up diagnostic assessments,

expensive follow-up procedures and procedure-related complications.

Morris, M.D., Brooke Army Medical Center (“BAMC”) pulmonology and critical care physician and

Assistant Dean of Research at San Antonio Uniformed Services Health Education Consortium (“SAUSHEC”), and Sheila A.

M.D., Director of the Pulmonary Lung Nodule Clinic and the Lung Cancer Screening Program at the South Texas Veterans Health Care Systems’

Murphy Memorial Veterans Hospital and Assistant Professor at the University of Texas Health Science Center at San Antonio, were

first and second authors on the study published in the Journal of Health Economics and Outcomes Research .

could have saved an average of $2,773 per patient for total cost savings of $379 million in 2022, while the screening could have saved

an average of $6,460 per patient for privately insured patients with a positive lung cancer screening for total cost savings of $891

The peer-reviewed study, “Economic Evaluation of a Novel Lung Cancer Diagnostic in a Population of Patients with a Positive

Low-Dose Computed Tomography Result,” attributes the savings to a reduction in follow-up diagnostic assessments, expensive follow-up

procedures, and procedure-related complications.

Morris, M.D., BAMC pulmonology and critical care physician and Assistant

Dean of Research at San Antonio Uniformed Services Health Education Consortium (“SAUSHEC”), and Sheila A.

Habib, M.D., Director

of the Pulmonary Lung Nodule Clinic and the Lung Cancer Screening Program at the South Texas Veterans Health Care Systems’ Audie

Murphy Memorial Veterans Hospital and Assistant Professor at the University of Texas Health Science Center at San Antonio, were first

and second authors on the study.

Economists John E.

Ph.D., and Maggie L.

Do Valle, Master of Public Health, of Avalon Health Economics also contributed to the study.

Schneider, Ph.D., and Maggie L.

Do Valle, Master of Public Health, of Avalon Health

Economics also were authors on the study.

Lung uses flow cytometry technology to detect and analyze cell populations in a person’s sputum, or phlegm, to find characteristics

indicative of lung cancer, including cancer and/or cancer-related cells that have shed from a lung tumor.

The flow cytometer is a well-established

instrument used in many commercial laboratories.

Flow cytometry collects data pertaining to properties of single cells labeled with antibodies

and dyes specific to cell types and characteristics.

Sputum is an excellent sample for analysis because it is in direct contact with

any malignancy in the lungs and can provide information about its area of field cancerization and the lung microenvironment.

A patented algorithm developed

using machine learning, a form of AI, automatically analyzes a patient’s flow cytometry data to generate a physician’s report

within minutes after data acquisition that stratifies patients into one of two risk groups.

A “Likely” result means cancer

has been detected.

An “Unlikely” result means cancer has not been detected.

The physician’s report also provides a

numerical probability score between 0.1 to 1.0, with 0.1 to less than 0.5 being a negative result and more than 0.5 to 1.0 considered

positive for lung cancer.

The proprietary automated analysis software was developed and is wholly owned and patent protected by bioAffinity

Technologies.

flow cytometer is a well-established instrument used in many commercial laboratories.

Flow cytometry collects data pertaining to properties

of single cells labeled with antibodies and dyes specific to cell types and characteristics.

Sputum is an excellent sample for analysis

because it is in direct contact with any malignancy in the lungs and can provide information about its area of field cancerization and

the lung microenvironment.

particular, CyPath ® Lung uses a synthetic porphyrin called meso-tetra (4-carboxyphenyl) porphyrin (“TCPP”).

9 unchanged sentences

uroporphyrin I superior to hematoporphyrin derivative.”

As used in CyPath ® Lung, the proportion of cells with high TCPP fluorescence intensity in a patient’s sputum sample

is a significant predictor of lung cancer.

We hold multiple patents protecting our use of TCPP for the diagnosis, monitoring, and treatment

In addition, we have multiple domestic and foreign patent applications to protect the use of flow cytometry and our AI-developed

automated analysis platform in the detection of lung cancer and other lung diseases using sputum as a sample.

developed an algorithm as part of a test validation trial that used machine learning to distinguish samples from high-risk patients who

had lung cancer from those who are cancer-free.

Results of the trial were published January 21, 2023, in the peer-reviewed journal Respiratory

Village Oaks developed CyPath ® Lung for sale as an LDT in accordance with the standards of the CAP and the

regulations and guidance of the CLIA program, which is administered by the Centers for Medicare and Medicaid Services (“CMS”).

Lung has been put into routine lab use without requiring expert evaluation of samples or being subject to operator bias.

allows the entire sputum sample to be rapidly analyzed.

The numerical analysis developed with machine learning captures complex interactions

between lung cancer, the microenvironment, and areas of field cancerization that would be impossible for individuals to predict or detect

reliably by eye.

For example, during test development, we discovered that viability staining density suggests a link with apoptosis,

or cell death, that is linked to many cancers, including lung cancer.

Our model also suggests that specific markers of immune cell populations

are informative as to the presence of cancer in the lung.

These findings are the result of our machine learning approach to automated

Lung evaluates sputum for the presence of cancer without the opportunity to introduced operator bias.

Our approach allows the entire

sputum sample to be rapidly analyzed.

The numerical analysis developed with machine learning captures complex interactions between lung

cancer, the microenvironment, and areas of field cancerization that would be impossible for individuals to predict or detect reliably

For example, during test development, we discovered that viability staining density suggests a link with apoptosis, or cell death,

that is linked to many cancers, including lung cancer.

Our model also suggests that specific markers of immune cell populations are informative

as to the presence of cancer in the lung.

These findings are the result of our machine learning approach to automated analysis.

Lung uses sputum that is obtained noninvasively by patients in the privacy of their home.

4 unchanged sentences

The Acapella ®

Choice Blue has been 510(k)-cleared by the FDA as a positive expiratory pressure device to help mobilize lung secretions in people

with certain lung conditions

Choice Blue has been 510(k)-cleared by the Food and Drug Administration (“FDA”) as a positive expiratory pressure device

to help mobilize lung secretions in people with certain lung conditions

sputum sample is shipped overnight by the patient to PPLS and processed into a single-cell suspension, then labeled with antibodies that

distinguish different cell types and the synthetic porphyrin TCPP that identifies cancer cells and/or cancer-associated cells.

can collect sample data and analyze a sputum sample in less than 30 minutes using integrated software for high-throughput, user-friendly

standardized analysis.

A physician’s report is generated within minutes after data acquisition.

The report stratifies the patient

into one of two risk groups.

Those patients deemed “likely or very likely” to have cancer may benefit from aggressive intervention.

Those “unlikely or very unlikely” to have a malignancy may continue imaging surveillance in accordance with local standard

The physician’s report also shows a numerical score between 0.1 to 1.0,

with 0.1 to less than 0.5 being a negative result and 0.5 to 1.0 considered positive for lung cancer.

The proprietary automated analysis

software was developed and is wholly owned and patent protected by bioAffinity Technologies.

receive test results within three days after the laboratory receives the patient’s sputum sample.

CyPath ® Lung testing

helps identify patients who should undergo more aggressive follow-up procedures to confirm a suspected lung cancer.

When CyPath ®

Lung sample analysis determines a patient is unlikely or very unlikely to have lung cancer, the result can serve to guide and support

a physician’s decision to monitor the patient using LDCT or CT imaging.

reported in an article titled “Detection of Early-Stage Lung Cancer in Sputum using Automated Flow Cytometry and Machine Learning,”

published in Respiratory Research on January 21, 2023, we conducted a 150-patient test validation trial of people at high risk

for lung cancer including patients with the disease (N=28) and those who were cancer-free (N=122) that resulted in CyPath ®

Lung’s overall 88% specificity, meaning the ability to correctly identify a person without cancer, and 82% sensitivity, meaning

the ability to correctly identify cancer in a person with the disease.

For the subset of patients in this trial who had lung nodules

20 mm or smaller or no nodules detected by imaging, this trial resulted in 92% sensitivity, 87% specificity, 99% negative predictive

value, and 88% accuracy.

In this subset of 132 individuals with small nodules, 119 patients were cancer-free and 13 had confirmed lung

Eight out of 10 (80%) of Stage I tumors were correctly identified.

Sensitivity is the percentage of persons with the disease

– in this case, lung cancer – who are correctly identified by the test.

Specificity is the percentage of persons without

lung cancer who are correctly identified by the test.

The cancer group included all lung cancer types, but mostly squamous cell carcinoma

and adenocarcinoma lung cancer (in near equal numbers), showing that CyPath ® Lung detects all types of lung cancer.

clinical trial results reported an Area Under the Curve (AUC) value of 0.89 for CyPath ® Lung.

AUC value indicates the

ability of a test to distinguish between positive and negative cases.

An AUC value of 0.7 to 0.8 is considered acceptable;

is excellent;

more than 0.9 is outstanding.

In study participants with lung nodules less than 20 mm, the test performed with an AUC value

this 19-month trial, participants provided a sputum sample and were released from the study after a physician either confirmed the individual

was cancer-free by examination of CT imaging or confirmed the presence of lung cancer by biopsy.

Flow cytometry and patient data used

in the analysis produced results that included (1) the proportion of cells with a high ratio of high TCPP fluorescence intensity over

(2) the proportion of cells with an intermediate ratio of fluorescence intensity caused by the viability dye (FVS510) over

(3) the proportion of cells that were CD206 negative but positive for one or more of the following markers:

CD66b (granulocytes),

CD3 (T cells), and CD19 (B cells);

and (4) patient age.

can collect sample data and analyze a sputum sample to produce a physician’s report in less than 20 minutes using integrated software

for high-throughput, user-friendly standardized analysis.

CyPath ® Lung technology is based on scientific work originating at Los Alamos National Laboratory in collaboration with

10 unchanged sentences

The length of the study and specific follow-up was not reported,

but researchers did report that one patient in the study who had been incorrectly considered to be a healthy subject was correctly

diagnosed with cancer by the test.

Later, a blinded clinical trial was conducted and results published September 2015 in an article titled

“Early Detection of Lung Cancer with Meso-Tetra (4-Carboxyphenyl) Porphyrin-Labeled Sputum” in the Journal of Thoracic

This study reported on an earlier version of CyPath ® Lung that used a fluorescent microscope to directly

identify cells labeled with TCPP in one-third or less of the sputum sample.

For each trial participant, researchers manually scanned

12 microscope slides labeled with TCPP for the presence of red fluorescent cells (“RFCs”) displaying a spectral signature

that indicated uptake of TCPP in the cell.

In addition to measuring the spectral signature, the fluorescent intensity and cell size of

RFCs were measured.

but researchers did report that one patient in the study who had been incorrectly considered to be a healthy subject was correctly diagnosed

with cancer by the test.

Later, a blinded clinical trial was conducted and results published in September 2015 in an article titled “Early

Detection of Lung Cancer with Meso-Tetra (4-Carboxyphenyl) Porphyrin-Labeled Sputum” in the Journal of Thoracic Oncology .

This study reported on an earlier version of CyPath ® Lung that used a fluorescent microscope to directly identify cells

labeled with TCPP in one-third or less of the sputum sample.

For each trial participant, researchers manually scanned 12 microscope slides

labeled with TCPP for the presence of red fluorescent cells (“RFCs”) displaying a spectral signature that indicated uptake

of TCPP in the cell.

In addition to measuring the spectral signature, the fluorescent intensity and cell size of RFCs were measured.

The test data, including fluorescent intensity over cell size, was analyzed.

The trial was conducted over 24 months

and resulted in 81% test accuracy, 77.9% sensitivity, and 65.7% specificity in the ability to correctly differentiate between samples

from lung cancer patients and those at high risk who were cancer-free.

The earlier trial required participants to provide a sputum sample

and CT imaging of the lungs.

The trial was conducted over 24 months and resulted in 81%

test accuracy, 77.9% sensitivity, and 65.7% specificity in the ability to correctly differentiate between samples from lung cancer patients

and those at high risk who were cancer-free.

The earlier trial required participants to provide a sputum sample and CT imaging of the

Those in the cancer cohort underwent a biopsy to confirm lung cancer.

High-risk patients displaying indeterminate

nodules were followed for 18 months to confirm they were cancer-free.

The study concluded that optimizing the test to provide for analysis

of the entire sputum sample would improve results.

January 1, 2024, the Medicare reimbursement code 0406U specific for CyPath ® Lung became effective after multiple regulatory

decisions in 2023 leading to approval.

On June 6, 2023, the American Medical Association (“AMA”) approved a Current Procedural

High-risk patients displaying indeterminate nodules were

followed for 18 months to confirm they were cancer-free.

The study concluded that optimizing the test to provide for analysis of the

entire sputum sample would improve results.

January 1, 2024, the Medicare reimbursement code 0406U specific for CyPath ® Lung became effective.

The Current Procedural

Terminology (“CPT”) Proprietary Laboratory Analysis (“PLA”) code specifically for use with CyPath ®

Lung, which was publicly released on June 30, 2023.

CyPath ® Lung is on CMS’ clinical laboratory fee schedule.

CPT PLA code assigned to CyPath ® Lung is 0406U with the descriptor “Oncology (lung), flow cytometry, sputum, 5 markers

(meso-tetra [4- carboxyphenyl] porphyrin [TCPP], CD206, CD66b, CD3, CD19), algorithm reported as likelihood of lung cancer.”

have an agreement with GO2 Partners to produce patient collection kits and to provide warehousing and distribution services for sending

out the kits.

Lung, is 0406U with the descriptor “Oncology (lung), flow cytometry, sputum, 5 markers (meso-tetra [\4- carboxyphenyl porphyrin

TCPP, CD206, onveniCD66b, CD3, CD19), algorithm reported as likelihood of lung cancer.”

have an agreement with Cardinal Health for logistical services assisting in the delivery of collection kits and

return of patient samples to PPLS.

Laboratory reagents, supplies, and equipment are commercially available through multiple vendors.

Sample processing, labeling,

and data collection can be accomplished by a laboratory technician skilled in general laboratory techniques.

Data analysis leading to

a physician’s report is done by automated analysis software fully integrated into the test.

processing, labeling, and data collection can be accomplished by a laboratory technician skilled in general laboratory techniques.

analysis leading to a physician’s report is done by using automated analysis software fully integrated into the test.

our knowledge, CyPath ® Lung is the first cancer diagnostic that combines flow cytometry and automated analysis to predict

7 unchanged sentences

has the potential to better patient outcomes.

particular, we believe the market for CyPath ® Lung is poised for significant growth.

The test is most often ordered

by physicians who need better clarity when patients present with small pulmonary nodules that are considered indeterminate, leaving

both physician and patient without a clear diagnostic path forward.

In Gould et al.

(2015), researchers reported that imaging

increasingly finds indeterminate pulmonary nodules with difficult choices:

“watchful waiting” with serial CT scans or

invasive procedures.

According to the National Lung Screening Trial Research Team (2011), lung cancer screening using low

dose CT can detect lung cancer at an early stage, but it has low specificity.

Only about four out of 100 patients with a

suspicious finding will have lung cancer.

In addition, Gould et al.

observed that indeterminate pulmonary nodules are

increasingly found incidentally when imaging for other reasons.

Projected Number of Indeterminate Pulmonary

Nodules in the U.S.

shown below, the total number of indeterminate pulmonary nodules detected by lung cancer screening and incidentally is projected to increase

by 62% from 2.9 million in 2025 to 4.7 million in 2030, representing an estimated market of greater than $4.7 billion for

CyPath ® Lung.

The forecast is based on a percentage of 2024 reported cases of suspicious pulmonary nodules and assumes

a 10% compound annual growth for the 2024-2030 period based on 1) an increase in lung cancer screening from 18.1% in 2023 to close to

50% by 2030 due to growing adoption and awareness with improved access, and 2) improved ability to detect indeterminate nodules through

greater adherence to guideline recommendations and use of AI.

addition, CyPath ® Lung’s ability to be used for surveillance of cancer survivors after they have completed treatment

represents an estimated market of $870 million over the next ten years.

The total number of people living with lung cancer is projected

to increase by 28% from 680,450 survivors in 2025 to 871,580 in 2035.

of CyPath ® Lung to Current Standards of Care

28 unchanged sentences

a population-based study,” published in the Journal of Thoracic Oncology on February 16, 2021

seen in the above table, CyPath ® Lung performs similar to current Standard of Care, including more invasive and riskier

diagnostic procedures.

Moreover, lung nodules are commonly found on CT scans.

Studies suggest up to 50% of lung nodules may be considered

“indeterminate” without clear indication of being benign or malignant, posing difficult choices for physicians and their

patients on steps.

Our business model is to address the need for a noninvasive, cost-effective, high-performing lung cancer diagnostic

that meets the need for more diagnostic certainty leading to quicker diagnosis at earlier stage for longer survival and reduced medical

Preventive Services Task Force recommended new guidelines for screening in March 2021, nearly doubling the number of

Americans at high risk for lung cancer who are recommended for annual screening to 14 million people, according to the ALA.

2023, the American Cancer Society updated its guidelines for lung cancer screening to include all former smokers over the age of 50 regardless

of when they quit, increasing the estimated number of American adults eligible for screening to 19 million.

China has an estimated 300

million smokers, according to the World Health Organization.

In Europe, it is estimated that there is one new case of lung cancer diagnosed

every minute, with incidence rates for males the highest in Eastern European countries and a five-year survival rate of only 13%, as

reported by a May 2021 article, “Lung cancer screening in Europe:

where are we in 2021?” published in Translational Lung

Cancer Research.

We expect to pursue CE marking of CyPath ® Lung for sale in the European Union (“EU”).

seen in the above table, CyPath ® Lung performs favorably compared to current Standards of Care, including more invasive

and riskier diagnostic procedures.

Our business model is to address the need for a noninvasive, cost-effective, high-performing lung

cancer diagnostic that meets the need for more diagnostic certainty leading to quicker diagnosis at earlier stage for longer survival

and reduced medical costs.

Lung Business Development Plan

3 unchanged sentences

cannot be predicted with certainty at this time.

Our business plan envisions four phases of expanding market entry into the U.S., the

EU, and worldwide that are timed to maximize our resources and minimize market risk.

Phase 1 of our business plan was completed in 2024

with a limited market launch of our LDT CyPath ® Lung in Texas.

This limited test market launch was designed to evaluate

our marketing program and help us ensure each step in the care pathway – from the initial order by physicians to sputum collection

and processing, to generating and delivering the patient report – is efficient and effective.

This limited test market approach

allowed us to refine future positioning and develop strategic insight for our CyPath ® Lung test before expanding to a

larger market.

believe that our strategy related to a limited market launch proved successful.

In January 2025, we reported the results of the

Company’s CyPath ® Lung pilot marketing program using Texas for our beta launch with sales growth

Quarter-over-Quarter and more than 600 tests delivered in 2024.

We attribute the growth in sales to three 2023 initiatives that came

to fruition in 2024:

(1) CMS’ inclusion of reimbursement for CyPath ® Lung on its 2024 clinical laboratory fee

schedule and subsequent reimbursement by Medicare and private insurance carriers;

(2) the hiring of our new National Director of

Sales in late 2023 and subsequent sales persons in 2024 who are experienced and well respected in the pulmonary

and (3) marketing materials for the newly branded CyPath ® Lung that emphasize our test’s ability to

assist physicians with next steps in patient care.

October 2024, CyPath ® Lung was awarded listing on the U.S.

Federal Supply Schedule (FSS), making the test available to

Veterans and active military personnel across government health systems.

We view this market opportunity as the next step in

expanding sales nationally in the U.S., including strategic expansion into regional markets in 2025.

Phase 2 of our business plan anticipates

entering the EU market with CyPath ® Lung as a CE-marked IVD test beginning with sales in the Netherlands, followed by

a staged EU expansion.

Phase 3 of our business plan focuses on the marketing of an FDA-cleared CyPath ® Lung test, beginning

with conducting a pivotal clinical trial in the U.S.

Toward that end, we have voluntarily sought FDA guidance with the intention of obtaining

clearance after completion of the pivotal trial of a Class II IVD medical device for use in the diagnosis of lung cancer in individuals

with indeterminate pulmonary nodules between 6 mm to less than 20 mm.

To differentiate our LDT test from the future FDA cleared diagnostic test,

we have named the test for which we are seeking FDA clearance “FlowPath Lung.” In December 2024, we met with FDA to discuss

our pre-submission and subsequently incorporated the requested protocol changes to improve the trial design.

Our revised trial protocol

is now under review by an IRB.

In third quarter 2024, the National Association of Veterans

Research and Education Foundation (“NAVREF”) extended a “Call for Interest” to VA systems to solicit participation

in the pivotal trial, which resulted in a positive response from 22 VA medical centers.

We are in the process of qualifying VA, academic

and private medical centers that have asked to participate.

Our Clinical Research Organization (“CRO”) is Courante Oncology.

Retired Army Col.

Michael Morris, MD., of Brooke Army Medical Center has accepted the position as national Principal Investigator for

the clinical trials.

We anticipate a three-to-four-year clinical trial including an 18-month patient enrollment of approximately 3,400

patients, with the first clinical site expected to open and patient enrollment expected to begin in in the second quarter of 2025.

pivotal trial will analyze sputum using flow cytometry data and patient data using the algorithm used for our LDT

CyPath ® Lung, including (1) the proportion of cells with a high ratio of high TCPP fluorescence intensity over cell

(2) the proportion of cells with an intermediate ratio of fluorescence intensity caused by the viability dye (FVS510) over

(3) the proportion of cells that were CD206 negative but positive for one or more of the following markers:

(granulocytes), CD3 (T cells), and CD19 (B cells);

and (4) patient age.

Patient enrollment is scheduled to begin in the second

quarter of 2025 at up to 20 collection sites.

Assuming the study is successful, we intend to submit a de novo classification request

to the FDA within six months of study completion.

Phase 4 of our business plan accelerates the market presence of CyPath ® Lung

as well as countries in Asia, Eastern Europe, and Australia after obtaining FDA marketing authorization.

have developed messaging and marketing programs that will continue to grow both in size and scope with each phase of development, including

key convention attendance, digital marketing, social media presence, and advertising, to create an “inbound” lead generation

mechanism that delivers our message to our target audience.

In addition, we will continue to expand our collaboration with regional and

national key opinion leaders (“KOLs”) and support efforts with collateral materials, including posters, presentations, videos,

and peer-reviewed papers, to our KOLs who will present data and case studies of their use of CyPath ® Lung.

can be shared across platforms, including websites and sales tools, and will be used as references to support our product claims as well

as sales and marketing efforts to physicians, reference laboratories, and patients.

We are also working with lung cancer advocacy groups

throughout all phases to support the message that routine lung cancer screening can save lives by diagnosing cancer at an early stage.

Our business plan envisions three phases of strategic expansion in the U.S.

European Union (“EU”) and Asia that are timed to maximize our resources and minimize market risk.

January 2025, we reported successful results from the Company’s CyPath ® Lung pilot marketing program using Texas

for our beta launch with sales growth quarter-over-quarter and more than 600 tests delivered in 2024.

Our test marketing approach allowed

us to refine future positioning and develop strategic insight for our CyPath ® Lung test before expanding to a larger market.

In 2025, we more than doubled the number of tests sold and tripled our revenues.

We expanded our sales team in the second half of 2025

to enter the Mid-Atlantic market.

2026, we will enter Phase 2 of our business plan with expansion into broader strategic markets aimed at providing national coverage,

including increasing our sales force and strategic partners in the Mid-Atlantic and entering the South Atlantic, Southeast, Northeast,

Midwest, West and federal markets.

Phase 2 includes launching our longitudinal clinical trial that will provide additional validation

and further evidence of CyPath ® Lung’s ability to detect early-stage lung cancer.

Phase 3 of our business plan, we expect to have achieved a national sales footprint upon which we can build and secure strategic partners

in the EU and Asia who can support entry into those markets.

We also foresee establishing CyPath ® Lung as a Standard of

Care for the federal and VA healthcare systems which can propel CyPath ® Lung for adoption as a Standard of Care for the

healthcare system.

will continue to execute on strategic marketing and promotional collaborations that can accelerate growth, including collaboration with strategic partners that provide greater market access, marketing resources, and opportunities

to leverage existing relationships with physicians and their patients.

have developed messaging and marketing programs that will continue to grow both in size and scope as we penetrate the U.S.

market, including

executing strategies that take advantage of practicing physicians who find significant benefits from using CyPath ® Lung.

To date, we have published more than a dozen patient case studies.

Peer-to-peer communication has been a driver for sales which is supported

by attending major conferences and presentations by key opinion leaders (“KOLs”) of case studies, digital marketing, social

media presence, and advertising to create an “inbound” lead generation mechanism that delivers our message to our target

Competition for CyPath ® Lung

Lung has not been tested directly against its competitors’ products, but a comparison of the published performance numbers

suggests CyPath ® Lung is among the highest performing tests on the market.

provides evidence that CyPath ® Lung is among the highest performing tests on the market.

Furthermore, CyPath ® Lung is

noninvasive – not even requiring a needle stick – and cost effective, and processing and analysis procedures are easy to

data and the results of clinical trials allow us to group lung cancer diagnostic tests into three categories:

(1) balanced tests;( 2)

rule-out tests, and (3) rule-in tests.

Balanced tests aim at excluding patients without cancer from unnecessary follow-up diagnostic

procedures and detecting patients with early-stage cancer who can proceed to more aggressive procedures to confirm diagnosis.

tests aim to exclude patients without cancer from unnecessary follow-up procedures with high accuracy (if the test provides a “negative”

result), but among the remainder of patients who do not receive an unambiguous negative result, there is still uncertainty about who

has cancer and who does not.

Cancer patients for whom time is of the essence are included in this group of patients still in uncertainty.

The patient can lose precious time with a rule-out test.

Rule-in tests aim to identify patients with cancer but in doing so may identify

many people without cancer as positive.

Therefore, rule-in tests have a low positive predictive value.

The recent economic journal article evaluating the significant healthcare

cost benefits of using CyPath ® Lung as a standard of care (Morris, et al., 2024) shows that balanced tests, like CyPath ®

Lung, can be the most cost effective.

Those that perform well are most useful to a physician and his or her patient because they provide

the most information, allowing a quicker decision on what follow-up path to choose:

whether to move forward with more aggressive follow-up

procedures (i.e., in the case of CyPath ® Lung, if the test reveals a “likely” or “highly likely”

cancer result) or to follow a more conservative approach (i.e., when the CyPath ® Lung test reveals an “unlikely”

or “very unlikely” cancer result).

competitive analysis reviewed published research that was sufficient to provide a scientific basis for evaluation.

We found only seven

tests, including CyPath ® Lung, that represent a balanced test for early lung cancer detection and have advanced to the

point that there is sufficient data for evaluation.

One test is sold by two companies:

one from the U.S.

and one from China.

the test is called Lung LB (sold by LungLife AI) and is now on the market.

LungLB is a FISH-based test that requires a significant amount

of experience to conduct.

Four companies, each selling unique tests for early lung cancer detection, conducted their studies on a population

that does not match the high-risk population for which the test is intended.

Their clinical data, therefore, is not necessarily representative

of the results that would be achieved in the population of patients who actually will use the test.

The remaining balanced test, ProLung,

is from IONIQ Sciences.

The test requires an expensive machine to measure transcutaneous bioconductance.

The test is not on the market

at this time.

First Look was recently launched to assist in determining whether a person

should be screened by LDCT.

While CyPath ® Lung is positioned to help diagnose lung nodules in patients who have already

undergone screening by LDCT, First Look is intended to be used prior to LDCT.

As such, this test may increase lung cancer screening

uptake and potentially increase the need for CyPath ® Lung.

found two rule-out tests on the market.

Both REVEAL, offered by MagArray, and Nodify-XL2, offered by Biodesix, are rule-out tests, meaning

the tests aim to exclude patients without cancer.

The REVEAL test is a blood test intended for patients with indeterminant nodules.

their 97-patient clinical validation trial, only patients with an intermediate risk of cancer, based either on a physician’s judgement

or a clinical model, took part.

This requirement led to 30% of high -risk patients being excluded at the onset of their analysis.

addition, the positive predictive value of the REVEAL test was 13.5% as compared to CyPath ® Lung’s positive predictive

value of 43.2%.

Importantly, CyPath ® Lung trial participants included those at high risk for lung cancer as defined by

CMS, and none were excluded based on physician’s judgement which can be highly subjective.

The tests had negative predictive values

of 98% and 97.8%, respectively.

The second rule-out test, Nodify-XL2, is used only by people with a pre-test probability of cancer less

As with the REVEAL test, a large number of patients were excluded from analysis.

In the case of Nodify-XL2, about 55% of patients

with lung nodules that physicians considered indeterminate, namely lung nodules sized between 8-30 mm, were excluded from the study.

In addition, Nodify XL-2 reported an AUC of 0.62 (unacceptable) and 0.76 (acceptable) for their two clinical trials, as compared to CyPath ®

Lung with an AUC of 0.89 and 0.90 in two independent study groups (excellent).

the Percepta nasal swab test offered by Veracyte is not widely available and reportedly is seeking a reimbursement code.

The test classifies

patients in low- and high-risk categories, or for those whose results are unclear, an intermediate category.

Test performance is different

in each risk category.

In a 2023 published paper of the test validation trial, the sensitivity and specificity for low-risk classification

was 97% and 40%, respectively, with those at low risk having an 8% calculated risk of having a malignancy.

The sensitivity and specificity

for the high-risk classification was 57% and 92%, respectively, and those patients who were put into the high-risk category had a 90%

risk of a malignancy.

One of the limitations of this study is that the participants in the validation trial had a cancer prevalence of

54% as compared to the overall high-risk population that has an estimated lung cancer prevalence of 1.1%, according to the National Lung

Cancer Screening Trial.

Therefore, we believe the nasal swab test’s performance may suffer when the classifier is tested on more

realistic cohorts with a cancer prevalence lower than 10%.

In addition, nearly half of all patients who took part in the validation trial

could not be classified as either low- or high-risk;

instead, they are considered “intermediate risk” with a 50:50 chance

of having cancer.

Thus, in nearly half of the patients who received the Percepta nasal swab test, the results would not help advance

the diagnostic process.

In fact, for those patients in this indeterminate category who do have cancer, valuable time in

diagnosis may be lost.

noninvasive – not even requiring a needle stick – and cost effective.

Processing and analysis procedures are easy to perform.

Our competitive analysis reviewed published research that was sufficient to provide a scientific basis for evaluation.

dose computer tomography (LDCT) is recommended as a screening test with eligibility driven by age and smoking history, but its low positive

predictive value (PPV) can lead to unnecessary invasive procedures on benign nodules.

CyPath ® Lung is recommended for

adults at high risk of lung cancer, particularly those with small or indeterminate pulmonary nodules discovered by LDCT, to assist doctors

in deciding whether to recommend invasive procedures such as biopsy or continue monitoring by LDCT.

CyPath ® Lung and competing

tests that assist in making such decisions may be categorized as (1) rule-out tests (2) rule-in tests, and (3) balanced tests.

tests are designed to have high sensitivity and negative predictive value (NPV) to determine that the patient is unlikely to

have lung cancer and exclude the patient from unnecessary follow-up procedures.

However, these tests also have lower specificity and

produce a greater number of false positives results.

Rule-in tests by contrast have high specificity but lower sensitivity, providing

higher positive predictive value (PPV) so that a positive result predicts the patient does have lung cancer.

The positive result may

lead to more aggressive follow-up procedures but with higher false-negative rates that can result in more invasive procedures on benign

Balanced tests are designed to achieve high sensitivity and specificity to both exclude patients without cancer

from unnecessary follow-up diagnostic procedures and accurately detect patients with early-stage cancer who can proceed to more aggressive

procedures to confirm diagnosis.

Lung is a balanced test, having demonstrated a sensitivity of 92% and a specificity of 87% and a NPV of 99% for patients with nodules under 20 mm in a

population with lung cancer prevalence of 18% (Lemieux 2023, Morris 2024).

The high sensitivity and specificity of CyPath ® Lung

make it a balanced test.

In our analysis we will classify competitors as balanced tests, rule-out tests and rule-in tests.

balanced test called LungLB (sold by LungLife AI in the US) is commercially available as

a laboratory developed test and has an insurance reimbursement code.

LungLB has reported

sensitivity and specificity of 77% and 72%, respectively, in a population with 74.2% malignant

lung lesions (Tahvilivan 2023).

The sensitivity and specificity of LungLB are lower than

for CyPath ® Lung.

Furthermore, the LungLB study was conducted on a population

with a much higher prevalence of disease than the intended high-risk patient population with

a reported prevalence of 1.1%.

(NLCST) Moreover, LungLB is a fluorescence in situ

hybridization (FISH)-based blood test that requires a significant amount of expertise to

offers two tests for patients with intermediate nodules.

The tests are commercially available

as laboratory developed tests and have insurance reimbursement codes.

Nodify XL2 is a rule-out

test with a sensitivity of 97%, specificity of 44% and a NPV of 99% in patients with solid

pulmonary nodule 8–30 mm and a probability of lung cancer ≤50% by the Mayo Clinic

solitary pulmonary nodule calculator (Kheir 2023).

About 55% of patients with lung nodules

that physicians considered indeterminate, namely lung nodules sized between 8-30 mm, were

excluded from the study.

Nodify CDT is a rule-in test with specificity of 98% and PPV of

78% validated for patients with an 8–30 mm nodule and pre-test risk ≤65% by the

Mayo calculator (Chapman 2012, Massion 2017, Biodesix website).

In contrast with Biodesix,

CyPath ® Lung can provide a balanced result with both high sensitivity and

specificity with a single test.

Furthermore, Nodify’s tests cannot be used by patients who have received a cancer diagnosis in the past five years.

CyPath ® Lung

does not have such a restriction and can be used as surveillance for lung cancer survivors.

Percepta nasal swab test offered by Veracyte is an RNA-based gene expression test.

is commercially available as a laboratory developed test and has an insurance reimbursement

Percepta Nasal Swab is recommended for current or former smokers who have a pulmonary

nodule detected on CT equal to or less than 30 mm.

Test performance is different for patients

determined to be in one of two risk categories.

In a 2023 test validation trial (Lamb 2023),

the sensitivity and specificity for individuals who are considered at low risk for lung cancer

was 97% and 40%, respectively.

The sensitivity and specificity for the high-risk classification

were 57% and 92%, respectively.

Similar to LungLB, patients in the study had a high cancer

prevalence of 54% as compared to the overall high-risk population that has an estimated lung

cancer prevalence of 1.1%.

(NLCST) Therefore, we believe the nasal swab test’s performance

may suffer when the classifier is tested on more realistic cohorts with a cancer prevalence

lower than 10%.

In addition, nearly half of all patients who took part in the validation

trial could not be classified as either low- or high-risk;

instead, they are considered “intermediate

risk” with a 50:50 chance of having cancer.

Thus, in nearly half of the patients who

received the Percepta nasal swab test, the results would not help advance the diagnostic

In fact, for those patients in this indeterminate category who do

have cancer, valuable time in diagnosis may be lost.

believe there are many reasons why CyPath ® Lung is a superior test when compared to its competitors.

First, lung sputum

is an excellent medium for early lung cancer detection because sputum is in close contact with the tumor and pre-cancerous areas that

shed cancer and pre-cancerous cells directly into the sputum, can be obtained noninvasively, and can be transported easily.

sputum contains immune cell populations in reaction to the presence of a tumor.

is an excellent medium for early lung cancer detection because (1) sputum is in close contact with the tumor and pre-cancerous areas

that shed cancer and pre-cancerous cells directly into the sputum, (2) can be obtained noninvasively, and (3) can be transported easily.

Moreover, sputum contains immune cell populations associated with the presence of a tumor.

Second, our proprietary technology is straightforward.

Our CyPath ® Lung platform technology is not a molecular test and does not collect genetic material that requires immediate

CyPath ® Lung uses well-established flow cytometry techniques to investigate cells contained in the sputum

for characteristics that indicate the likelihood of lung cancer.

Sample processing is straightforward, and laboratory technicians can

be easily trained.

CyPath ® Lung uses well-established flow cytometry techniques to investigate cells contained in the sputum for characteristics

that indicate the likelihood of lung cancer, unlike molecular tests which can use labile genetic materials.

Sample processing is well

established, and laboratory technicians can be easily trained.

Reagents used by the test are widely available.

Data acquisition and analysis is fully automated, allowing for non-biased,

efficient test results.

Third, CyPath ® Lung has shown high specificity and sensitivity that is similar to far more invasive

and more expensive procedures currently used to detect lung cancer.

Fourth, CyPath ® Lung is cost effective, with a Medicare

reimbursement code billable to both government and private insurance carriers.

A 2024 study authored by Michael Morris, M.D., and Sheila Habib, M.D., reported on CyPath ®

Lung’s economic impact when used as companion test to the current Standard of Care predicting savings of more than $2,700 per Medicare

patient and more than $6,400 per patient with private payer insurance who have pulmonary nodules sized less than 30 mm.

Fifth and as important

as any of our test’s benefits, CyPath ® Lung is patient friendly, providing at-home, noninvasive sample collection.

on our Flow Cytometry Platform to Develop COPD and asthma precision diagnostics

are conducting research to expand our platform technology to detect other lung diseases, including development of precision diagnostics

to identify patients who can best use commercial therapies and treatments in late-stage clinical phases that treat asthma and Chronic

Obstruction Pulmonary Disease (COPD).

Data acquisition and analysis

is fully automated, allowing for non-biased, efficient test results.

Third, CyPath ® Lung has demonstrated high specificity

and sensitivity that is similar to far more invasive and more expensive procedures currently used to detect lung cancer.

Fourth, CyPath ®

Lung is cost effective, with a Medicare reimbursement code billable to both government and private insurance carriers.

A 2024 study authored

by Michael Morris, M.D., and Sheila Habib, M.D., reported on CyPath ® Lung’s economic impact when used as companion

test to the current standard of care predicting savings of more than $2,700 per Medicare patient and more than $6,400 per patient with

private payer insurance who have pulmonary nodules sized less than 30 mm.

Fifth and as important as any of our test’s benefits,

CyPath ® Lung is patient friendly, providing at-home, noninvasive sample collection.

recent economic journal article evaluating the significant healthcare cost benefits of using CyPath ® Lung as a standard

of care (Morris, et al., 2024) shows that balanced tests, like CyPath ® Lung, can be the most cost effective.

perform well are most useful to a physician and their patient because they provide the most information, allowing a quicker decision

on what follow-up path to choose:

whether to move forward with more aggressive follow-up procedures after a CyPath ® Lung

results in a “likely malignancy” or to follow a more conservative approach when the CyPath ® Lung test result

is “unlikely malignancy”.

on our Flow Cytometry Platform to Develop Asthma and COPD Companion Diagnostics

We are conducting research studies that expand our

platform technology to detect the type and severity of inflammation in the lung and design precision diagnostics that identify patients

who will benefit from effective but often expensive commercial therapies treating asthma and chronic obstruction pulmonary disease (“COPD”).

Major pharmaceutical companies offer very effective treatments for asthma and COPD that work well for some sufferers but not all.

patients must try a series of different types of treatments before finding an effective therapy.

Our tests under development leverage

our expertise in using our proprietary flow cytometry platform equipped with automated AI analysis to develop tests that match asthma

and COPD patients with the most appropriate biologic therapies and monitor their ongoing conditions.

estimated 23 million adults in the U.S.

and 27 million people in the EU have been diagnosed with asthma;

and 4.2% of Chinese

adults presented with asthma in a representative sample of adults recruited for a national cross-sectional China Pulmonary Health study

between 2012 and 2015, representing 45.7 million adults in China.

and 27 million people in the EU have been diagnosed with asthma, and 4.2% of Chinese adults presented

with asthma in a representative sample of adults recruited for a national cross-sectional China Pulmonary Health study between 2012 and

2015, representing 45.7 million adults in China.

Furthermore, an estimated 14.2 million U.S.

adults had COPD in 2021

and approximately 36.6 million people in Europe had COPD in 2020, with the expectation that almost 50 million people in Europe will have

COPD in 2050.

The diagnostics market for COPD alone was valued at $5.6 billion in 2023 and is expected to reach $8.2 billion by 2029,

according to a market research study published by Research and Markets in November 2023.

We are building on our expertise in using

sputum as a sample for flow cytometric analysis to develop tests to detect COPD and asthma, including research to detect the presence

of specific therapeutic targets to identify patients who can benefit from specific treatments.

We expect to continue research through

2025 with patient studies expected in 2026.

adults had COPD in 2021, and approximately

36.6 million people in Europe had COPD in 2020, with the expectation that almost 50 million people in Europe will have COPD in 2050.

The diagnostics market for COPD alone was valued at $5.6 billion in 2023 and is expected to reach $8.2 billion by 2029, according to

a market research study published by Research and Markets in November 2023.

We are building on our expertise in using sputum as

a sample for flow cytometric analysis to develop tests to detect COPD and asthma, including research to detect the presence of specific

therapeutic targets to identify patients who can benefit from specific treatments.

We expect to begin patient studies in 2026.

Therapeutics Research

have completed and expect to report at one or more scientific conferences our findings describing the results of our research to

advance our own scientific discoveries demonstrating that inhibition of the expression of two specific cell membrane proteins

results in the selective killing of various cancer cell types grown in the laboratory with little or no effect on normal

(non-cancerous) cells.

We expect to pursue additional research and clinical development in this area with strategic partners that have the

resources to advance our discoveries.

therapeutic platforms originated from our research on how TCPP, the synthetic porphyrin used in CyPath ® Lung, enters cancer

We conducted research to better understand the mechanism of TCPP’s selective uptake in cancer cells.

Our research identified

receptors, cell-membrane proteins which capture small molecules outside of the cell and bring them inside the cell, that are associated

Experiments that we conducted confirmed that at least two of these receptors, CD320 and LRP2, contributed to TCPP uptake by

have completed and expect to report at one or more scientific conferences our findings describing the results of our research to advance

our own scientific discoveries demonstrating that inhibition of the expression of two specific cell membrane proteins results in the

selective killing of various cancer cell types grown in the laboratory with little or no effect on normal (non-cancerous) cells.

to advance research for use of this technology as a topical treatment of squamous cell skin cancer.

We expect to present our findings

at conferences and publish our research in peer-reviewed journals in the near future.

We intend to seek strategic partners to develop

our therapeutic discoveries which could result in broad-spectrum cancer treatments in the future.

therapeutic discoveries originated from our research on how TCPP, the synthetic porphyrin used in CyPath ® Lung, enters

cancer cells.

When these receptors were individually “knocked down” in cancer cells and therefore could not be made by the

cell, TCPP uptake was significantly decreased.

Knock-down of CD320 and LRP2 receptors was achieved by introducing siRNA molecules into

the cells that cause the destruction of CD320 and LRP2 gene products.

These gene products were the messenger (m)RNAs that are the precursors

of the receptor protein.

An siRNA is a small, chemically synthesized piece of RNA that specifically binds to mRNA, prohibiting the further

production of the corresponding proteins.

We conducted research to better understand the mechanism of TCPP’s selective uptake in cancer cells.

identified receptors, cell-membrane proteins which capture small molecules outside of the cell and bring them inside the cell, that are

associated with TCPP.

Experiments that we conducted confirmed that at least two of these receptors, CD320 and LRP2, contributed to TCPP

uptake by cancer cells.

When these receptors were individually “knocked down” in cancer cells and therefore could not be

made by the cell, TCPP uptake was significantly decreased.

Knock-down of CD320 and LRP2 receptors was achieved by introducing siRNA molecules

into the cells that cause the destruction of CD320 and LRP2 gene products.

These gene products were the messenger (m)RNAs that are the

precursors of the receptor protein.

An siRNA is a small, chemically synthesized piece of RNA that specifically binds to mRNA, prohibiting

the further production of the corresponding proteins.

Thus, the reduction of CD320 or LRP2 mRNAs reduced the CD320 or LRP2 protein, respectively,

3 unchanged sentences

their growth significantly but left normal cells virtually unharmed.

designed siRNAs to effectively eliminate CD320 and LRP2 protein production to study their role in TCPP uptake into the cell.

CD320 and LRP2 siRNAs, we achieved a reduction of CD320 and LRP2 protein levels of up to 90%.

Simultaneous siRNA knock-down of CD320

and LRP2 in normal cells, including skin fibroblasts and breast epithelial cells, did not affect cell growth.

However, knock-down of

CD320 and LRP2 in cancer cell lines derived from diverse tissues (lung, breast, prostate, brain, and skin cancers) inhibited cell growth

or killed the cells, in some cases up to 80%.

Interestingly, in some cell lines, when either CD320 or LRP2 were silenced individually,

a concurrent increase in protein expression of the other receptor was observed, suggesting that CD320 and LRP2 compensate for each other’s

hence, silencing both receptors is required for optimal cell killing.

designed siRNAs to effectively eliminate CD320 and LRP2 protein production.

With these CD320 and LRP2 siRNAs, we achieved a reduction

of CD320 and LRP2 protein levels of up to 90%.

Simultaneous siRNA knock-down of CD320 and LRP2 in normal cells, including skin fibroblasts

and breast epithelial cells, did not affect cell growth.

However, knock-down of CD320 and LRP2 in cancer cell lines derived from diverse

tissues (lung, breast, prostate, brain, and skin cancers) inhibited cell growth or killed the cells, in some cases up to 80%.

were incorporated in the State of Delaware on March 26, 2014.

23 unchanged sentences

property rights of others.

patent positions for biotechnology companies like ours are generally uncertain and can involve complex legal, scientific, and factual issues.

In addition, the coverage claimed in a patent application can be significantly reduced before a patent is issued, and its scope can be

reinterpreted and even challenged after issuance.

As a result, we cannot guarantee that any of our product candidates will be protectable

or remain protected by enforceable patents.

We cannot predict whether the patent applications we are currently pursuing will issue as

patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient proprietary protection from

patent positions for biotechnology companies like ours are generally uncertain and can involve complex legal, scientific, and factual

In addition, the coverage claimed in a patent application can be significantly reduced before a patent is issued, and its scope

can be reinterpreted and even challenged after issuance.

As a result, we cannot guarantee that any of our product candidates will be

protectable or remain protected by enforceable patents.

We cannot predict whether the patent applications we are currently pursuing will

issue as patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient proprietary protection

from competitors.

Any patents that we hold may be challenged, circumvented, or invalidated by third parties.

of December 31, 2025, we and our OncoSelect® subsidiary have a patent estate that includes 19 issued U.S.

and foreign counterpart

patents including two U.S.

patents and 15 foreign counterpart patents in Australia, Canada, China, France, Germany, Hong Kong, India,

Italy, Mexico, Japan, Spain, Sweden, and the United Kingdom.

We and OncoSelect® own all patents and trademarks in our intellectual

property portfolio.

patent and nine counterpart foreign patents directed at diagnostic applications expire in 2030 and one foreign

patent directed at a diagnostic application expires in 2039.

patent and five counterpart foreign patents directed at therapeutic

applications expire in 2037.

patents including three U.S.

patents and 16 counterpart patents in Australia, Canada, China, France, Germany, Hong Kong, Italy, Mexico,

Japan, Spain, Sweden, and the United Kingdom.

We and OncoSelect ® own all patents and trademarks in our intellectual property

patent and nine counterpart non-U.S.

patents directed at diagnostic applications expire in 2030, three non-U.S.

directed at a diagnostic application for lung cancer prediction expires in 2039, and one non-U.S.

patent directed to an automated diagnostic

lung cancer prediction assay expires in 2042.

patent directed to siRNA therapeutic compounds and method of use for treating

cancer expires in 2042, one counterpart non-U.S.

patent expires in 2039, and one U.S.

patent and two counterpart non-U.S.

patents directed

to therapeutic porphyrin conjugate compounds and method of use for treating cancer expire in 2037.

regard to our diagnostic patent portfolio, we have one issued U.S.

patent and nine foreign counterpart patents in Canada, China, France,

Germany, Hong Kong, Italy, Spain, Sweden, and the United Kingdom with another recently awarded diagnostic patent in Japan.

Our diagnostic patent applications, fall into one of two families:

one directed at diagnosing lung health using flow cytometry and the other directed at proprietary compensation beads used in analysis

by flow cytometry.

The diagnostic family of pending patent applications is directed at diagnosing lung health and includes three pending

non-provisional U.S.

patent applications and 18 foreign counterpart patent applications in Australia, Canada, China, European Patent Office,

Hong Kong, Japan, Mexico, and Singapore filed in 2019 and 2024, one non-provisional U.S.

patent application directed to compensation beads

for flow cytometry and one International Patent Application filed in 2023 directed to diagnosing lung health.

regard to our therapeutic product candidates, we have one issued U.S.

patent, five issued foreign patents in Australia, China, Hong Kong,

India and Mexico, two pending U.S.

applications, and 10 foreign applications pending in Canada, China, European Patent Office, and Hong

The therapeutic intellectual property is made up of two families, including one family directed at our siRNA product candidates

for the treatment of cancer, and another family directed at our porphyrin conjugates for treating cancer.

patent and nine counterpart patents in Canada, China, France, Germany,

Hong Kong, Italy, Spain, Sweden, and the United Kingdom.

Diagnostic lung health patents have issued in Australia, China and Japan.

diagnostic lung health patent applications, fall into one of two families:

one directed at diagnosing lung health using flow cytometry

and the other directed at proprietary compensation beads used in analysis by flow cytometry.

The diagnostic lung health family of pending

patent applications includes three pending non-provisional U.S.

patent applications and 21 counterpart patent applications in Australia,

Canada, China, European Patent Office, Hong Kong, Japan, Mexico, and Singapore filed in 2019 and 2024, and one non-provisional U.S.

application directed to compensation beads for flow cytometry.

regard to our therapeutic product candidates, we have two issued U.S.

patents, three issued patents in China, Hong Kong, and Mexico,

one pending U.S.

application, and 7 counterpart applications pending in Canada, China, European Patent Office, and Hong Kong.

The therapeutic

intellectual property patent portfolio is made up of two families, one family directed at our siRNA product candidates for the treatment

of cancer, and another family directed at our porphyrin conjugates for treating cancer.

term of individual patents depends upon the legal term of the patents in the countries in which they are obtained.

27 unchanged sentences

addition, we plan to rely on regulatory protection based on orphan drug exclusivities, data exclusivities, and market exclusivities.

Products (including Medical Devices and Tests)

the U.S., medical devices, including IVDs are subject to extensive regulation by the FDA, under the federal Food, Drug and Cosmetic Act

(“FDCA”) and its implementing regulations, and certain other federal and state statutes and regulations.

The laws and regulations

govern, among other things, the design, manufacture, storage, recordkeeping, approval, labeling, promotion, post-approval monitoring

and reporting, distribution, and import and export of medical devices, including IVDs.

IVDs are a category of medical device that can

be purchased by clinical laboratories and used to perform laboratory testing.

IVDs include reagents and instruments used to detect the

presence of certain chemicals or other biomarkers in human specimens for the purpose of diagnosis or detection of diseases or conditions.

IVDs can also be used to perform predictive, prognostic, and screening testing.

Like other medical devices, IVDs may require premarket

review and clearance, authorization, or approval by the FDA.

Failure to comply with applicable requirements may subject a device and/or

its manufacturer to a variety of administrative and judicial sanctions, such as FDA refusal to approve pending premarket approval (“PMA”)

applications, issuance of warning letters or untitled letters, mandatory product recalls, import detentions, civil monetary penalties,

and/or judicial sanctions, such as product seizures, injunctions, and criminal prosecution.

the U.S., clinical laboratories are subject to regulation under the Clinical Laboratory Improvement Amendments of 1988 (CLIA), which

is administered by the Center for Medicare and Medicaid Services (CMS) in partnership with the states.

A clinical laboratory is defined

as a facility that performs testing on materials derived from the human body for the purpose of diagnosing, preventing, or treating disease,

or for assessing health.

CLIA establishes quality standards for all clinical laboratory testing to ensure the accuracy, reliability,

and timeliness of patient test results regardless of where the test was performed.

In particular, these regulations mandate that clinical

laboratories must be certified, which requires inspection by either CMS or a deemed accreditation organization.

The College of American

Pathologists (CAP), a member-based physician organization comprising approximately 18,000 board-certified pathologists.

has been granted

deeming authority from the federal government, meaning that laboratories accredited by CAP’s Laboratory Accreditation Program qualify

for a CLIA Certificate of Accreditation and undergo periodic CAP inspection to maintain their accreditation.

also requires that laboratories meet quality assurance, quality control and personnel standards, perform proficiency testing, and undergo

The CLIA standards applicable to clinical laboratories are based on the complexity of the testing performed by the laboratory,

which ranges from “waived” to “moderate complexity” to “high complexity.”

state can be exempted from CLIA requirements if it has laws in effect that provide for requirements equal to or more stringent than CLIA

requirements.

New York State has been exempted from CLIA;

to operate a laboratory in or testing specimens from New York State a laboratory

must hold a permit issued by the New York State Clinical Laboratory Evaluation Program.

Certain states that administer the CLIA program

also require laboratories to hold a state license in order to operate in or test specimens from the state.

Developed Tests

CyPath ® Lung completed its certification as an LDT in accordance

with CAP and CLIA regulations and guidance in 2023.

The FDA considers LDTs to be tests that are developed, validated, and performed within

a single laboratory.

While CMS oversees clinical laboratory operations through the CLIA program, the FDA has the authority to regulate

LDTs as IVDs under the FDCA.

On May 6, 2024, FDA promulgated a final rule phasing out over four years its enforcement discretion over

The agency said it will expect compliance with premarket review and quality system requirements for LDTs marketed after May 6, 2024.

The FDA states that the agency will generally not enforce premarket review requirements for LDTs that were marketed before May 6, 2024,

if they are not modified in certain ways.

In particular, the rule states that the LDT is exempt if marketed before May 6, 2024, and is

not modified in a way that changes its indications for use;

does not alter its operating principle;

does not include significantly different

and, the LDT does not adversely change its performance or safety specifications.

The Company has no expectation or intention

to modify CyPath ® Lung in any manner that will change its indications for use, alter its operating principal, include different

technology, or change its performance or safety specifications.

Laboratory Improvement Amendments of 1988

laboratories testing specimens collected in the U.S.

for the purpose of disease diagnosis or health assessment are subject to CLIA, unless

CLIA establishes quality standards for all clinical laboratory testing to ensure the accuracy, reliability, and timeliness of

patient test results regardless of where the test was performed.

In particular, these regulations mandate that clinical laboratories

must be certified by the federal government or an accreditation organization with deemed status from the federal government or must

be located in a state that has been granted exemption from CLIA requirements because the state has laws in effect that provide for requirements

equal to or more stringent than CLIA requirements.

CLIA also requires that laboratories meet quality assurance, quality control and personnel

standards, perform proficiency testing, and undergo inspections.

The CLIA standards applicable to clinical laboratories are based on

the complexity of the testing performed by the laboratory, which ranges from “waived” to “moderate complexity”

to “high complexity.” In the case of tests performed using IVDs, test complexity categorization of the IVD is performed by

is a member-based physician organization comprising approximately 18,000 board-certified pathologists.

CAP’s Laboratory Accreditation

Program has been granted deeming authority from the federal government, meaning that CAP accreditation can be used to qualify for CLIA

certification and to satisfy CLIA inspection requirements.

FDCA classifies medical devices into one of three categories based on the risks associated with the device and the level of control necessary

to provide reasonable assurance of safety and effectiveness.

Class I devices are low risk and are subject only to general regulatory

Class II devices are moderate risk.

They are subject to general controls and may also be subject to special controls.

III devices are generally the highest risk devices.

They are required to obtain premarket approval and comply with postmarket conditions

of approval in addition to general regulatory controls.

establishments that design and/or manufacture devices are required to register their establishments with the FDA.

They also must provide

the FDA with a list of the devices that they design and/or manufacture at their facilities.

can perform tests using in vitro diagnostic (IVD) products manufactured by third parties or using their own proprietary methods.

developed, manufactured, and used within a single CLIA-certified laboratory are known as laboratory developed tests or LDTs.

party manufactured IVDs are regulated as medical devices by FDA.

FDA historically asserted that LDTs were also subject to regulation

as IVD medical devices, but historically exercised enforcement discretion with respect to (i.e., did not regulate) most LDTs.

6, 2024, FDA published a final rule amending the definition of an in vitro diagnostic (“IVD”) device to include tests manufactured

by a clinical laboratory.

The final rule also announced FDA’s intention to apply its medical device requirements, including in

some cases the requirement to obtain premarket authorization, to LDTs.

On March 31, 2025, a federal district court vacated the FDA final

rule, thereby cancelling the rulemaking’s associated requirements.

The court held that laboratory developed tests do not meet the

definition of a medical device under the Federal Food, Drug, and Cosmetic (“FD&C”) Act and the FDA therefore lacks jurisdiction

to regulate them.

The court directed FDA to rescind the final rule, which occurred on September 19, 2025.

devices are subject to regulation by the FDA, under the federal Food, Drug and Cosmetic Act (“FDCA”) and its implementing

The laws and regulations govern, among other things, the design, manufacture, storage, recordkeeping, approval, labeling,

promotion, post-approval monitoring and reporting, distribution, and import and export of medical devices.

classifies medical devices into one of three categories—Class I, Class II, and Class III— based on the risks associated with

the device and the level of control necessary to provide reasonable assurance of safety and effectiveness.

Class I (low risk) devices

are subject only to general regulatory controls.

Class II (moderate risk) devices are subject to general controls and may also be subject

to special controls.

Class III (high risk) require premarket approval and are subject to postmarket conditions of approval in addition

to general regulatory controls.

Class I devices can be marketed without prior FDA review and authorization.

Some Class I and most Class II devices require FDA

review and authorization before they can be marketed through 510(k) notification or de novo classification pathways.

clearance of a 510(k) notification, a device must be shown to be substantially equivalent to a legally marketed predicate device.

Novel low and moderate risk devices, for which substantial equivalence to a legally marketed predicate cannot be demonstrated, can

be marketed pursuant to FDA grant of a request for de novo classification.

Class III medical devices can be legally sold within the

only if the FDA has approved an application for premarket approval (PMA).

PMA applications, 510(k) premarket notifications, and de

novo requests require payment of user fees.

a device is placed on the market, numerous general regulatory controls apply.

Manufacturers must register their establishment with FDA

and list the devices they manufacture.

Other postmarket requirements may include those relating to labeling, corrections, removals, and

recalls, medical device reporting, and establishing a quality system.

Manufacturers

of medical devices are permitted to promote products solely for the uses and indications set forth in the approved or cleared product

A number of enforcement actions have been taken against manufacturers that promote products for “off-label” uses

(i.e., uses that are not described in the approved or cleared labeling).

of the FDCA relating to inappropriate promotion of medical devices may also lead to investigations alleging violations of federal and

state healthcare fraud and abuse and other laws, as well as state consumer protection laws.

FDA enforces its requirements by market surveillance and periodic inspections, both announced and unannounced, to review records, equipment,

15 unchanged sentences

to grant export approval or export certificates for devices;

Authorization and Notification

most Class I and some Class II devices may be marketed without prior FDA authorization, many Class II and most Class III medical devices

can be legally sold within the U.S.

only if the FDA has:

(1) approved a PMA application prior to marketing, generally applicable to most

Class III devices;

(2) cleared the device in response to a premarket notification (a “510(k) submission”), generally applicable

to some Class I and most II devices;

or (3) authorized the device to be marketed through the de novo classification process, generally

applicable for novel low- or moderate-risk devices.

PMA applications, 510(k) premarket notifications, and de novo requests require

payment of user fees.

Premarket Notification

marketing in the U.S.

for most Class II and a limited number of Class I devices typically follows the 510(k) premarket notification pathway.

To obtain 510(k) clearance, a manufacturer must submit a premarket notification demonstrating that the proposed device is substantially

equivalent to a legally marketed device, referred to as the “predicate device.” A predicate device may be a previously 510(k)

cleared device or a Class III device that was in commercial distribution before May 28, 1976, for which the FDA has not yet called for

PMA applications, or a product previously placed in Class II or Class I through the de novo classification process.

The manufacturer

must show that the proposed device has the same intended use as the predicate device, and that it either has the same technological characteristics,

or has different technological characteristics but is shown to be equally safe and effective and does not raise different questions of

safety and effectiveness as compared to the predicate device.

FDA has a user fee goal to apply no more than 90 calendar review days to 510(k) submissions.

During the process, the FDA may issue an

Additional Information request, which stops the clock.

The applicant has 180 days to respond, although during the COVID-19 Public Health

Emergency, the FDA permitted companies an additional 180 days in which to respond.

Therefore, the total review time absent the Public

Health Emergency could be up to 270 days, and in practice may be longer.

a device receives 510(k) clearance, any modification that could significantly affect its safety or effectiveness, or that would constitute

a major change in its intended use, requires a new 510(k) clearance or could require a PMA approval or de novo classification.

The FDA requires each manufacturer to make this determination in the first instance, but the FDA can review any such decision.

FDA disagrees with a manufacturer’s decision not to seek a new 510(k) clearance for the modified device, the agency may retroactively

require the manufacturer to seek 510(k) clearance, de novo classification, or PMA approval.

The FDA also can require the manufacturer

to cease marketing and/or recall the modified device until 510(k) clearance or PMA approval is obtained.

Novo Classification

of a new type that the FDA has not previously classified based on risk are automatically classified into Class III regardless of the

level of risk they pose.

To avoid requiring PMA review of novel low- to moderate-risk devices classified in Class III by operation of

law, Congress enacted a provision that allows the FDA to reclassify a novel low- to moderate-risk device into Class I or II in the absence

of a predicate device that would support 510(k) clearance.

The FDA evaluates the safety and effectiveness of devices submitted for review

under this de novo pathway and devices determined to be Class II can serve as predicate devices for future 510(k) applicants.

The de novo pathway can require clinical data.

FDA has a user fee goal to review a de novo request in 150 calendar review days.

During the process, the FDA may issue an Additional

Information request, which stops the clock.

The applicant has 180 days to respond.

Therefore, the total review time could be as long

as 330 days and in practice may be longer.

During the COVID-19 public health emergency, applicants were given an additional 180 days

in which to respond.

Class III product generally must follow the PMA approval pathway.

The PMA must be supported by sufficient valid scientific evidence,

including clinical study data, to assure that the device is safe and effective for its intended use(s).

After completion of clinical

testing, a PMA including the results of all non-clinical, clinical, and other testing and information relating to the product’s

marketing history, design, labeling, manufacture, and controls, is prepared and submitted to the FDA.

PMA approval process is generally more expensive, rigorous, lengthy, and uncertain than the 510(k) premarket notification process and

de novo classification process and requires proof of the safety and effectiveness of the device to the FDA’s satisfaction.

As part of the PMA review, the FDA will typically inspect the manufacturer’s facilities for compliance with Quality System Regulation

(“QSR”) requirements, which impose elaborate testing, control, documentation, and other quality assurance procedures.

FDA has a user fee goal to review a PMA in 180 calendar review days if the submission does not require advisory committee input, or 320

review days if the submission does require advisory committee input.

During the process, the FDA may issue a major deficiency letter,

which stops the review clock.

The applicant has up to 180 days to respond.

Therefore, the total review time could be up to 360 days,

if the submission does not require advisory committee input, or 500 days if the submission does require advisory committee input, and

in practice may be longer.

The COVID-19 pandemic significantly increased the FDA’s workload because of the need to review emergency

use authorization requests for IVDs and other regulated products, which delayed review timelines for some non-COVID-19 products.

the FDA’s evaluation of the PMA application is favorable, the FDA will issue a PMA for the approved indications, which can be more

limited than those originally sought by the manufacturer.

The PMA can include post-approval conditions that the FDA believes necessary

to ensure the safety and effectiveness of the device including, among other things, restrictions on labeling, promotion, sale, and distribution

or a requirement for postmarket surveillance or completion of postmarket studies.

Failure to comply with the conditions of approval can

result in material adverse enforcement action, including the loss or withdrawal of the approval and/or placement of restrictions on the

sale of the device until the conditions are satisfied.

after approval of a PMA, a new PMA or PMA supplement may be required in the event of a modification to the device, its labeling, or its

manufacturing process.

Supplements to a PMA may require the submission of the same type of information required for an original PMA,

except that the supplement is generally limited to that information needed to support the proposed change from the product covered by

the original PMA.

at least one clinical trial is required to support a PMA application.

Clinical studies also may be required for de novo classification

or a 510(k) premarket notification.

Clinical trials may also be conducted or continued to satisfy post-approval requirements for devices

For significant risk investigational device studies, the FDA regulations require that human clinical investigations conducted

be subject to an approved investigational device exemption (“IDE”).

An IDE application is considered approved

30 days after it has been received by the FDA, unless the FDA otherwise informs the sponsor prior to that time that the IDE is approved,

approved with conditions, or disapproved.

that is intended for use in diagnosis, cure, treatment, mitigation or prevention of disease meets the definition of a medical device

and is subject to FDA regulation.

Software that is included in a hardware device (Software in a Medical Device or SiMD) is regulated

as part of the hardware device.

Freestanding software (Software as a Medical Device or SaMD) may be subject to regulation by FDA but

may be exempt if it meets certain criteria.

In 2016, the 21st Century Cures Act, (the “Cures Act”), among other things, amended

the medical device definition in the FDC Act to exclude certain software from FDA regulation.

Exempt categories include ertain types

of clinical decision support (CDS) software.

CDS software is exempt from the medical device definition if it:

(a) displays, analyzes

or prints medical information about a patient or other medical information;

(b) is intended for the purpose of supporting or providing

recommendations about a patient’s care to a health care professional, (“HCP”), user;

and (c) provides sufficient information

about the basis for the recommendations to the HCP user, so that the HCP user does not rely primarily on any of the recommendations to

make a clinical decision about an individual patient;

unless (d) the software function acquires, processes, or analyzes a medical image,

a signal from an in vitro diagnostic device, or a pattern or signal from a signal acquisition system.

In January 2026 FDA issued an updated

final guidance document interpreting the Cures Act as it pertains to CDS software and provides examples of CDS that that meet the exemption

criteria and those that do not.

trials conducted with investigational devices or to support FDA marketing authorization or with a device that requires but does not

have marketing authorization are subject to regulations to protect human subjects and ensure data integrity.

For significant risk

investigational device studies, the FDA regulations require that human clinical investigations conducted in the U.S.

be subject to

an approved investigational device exemption (“IDE”).

An IDE application is considered approved 30 days after it has

been received by the FDA, unless the FDA otherwise informs the sponsor prior to that time that the IDE is approved, approved with

conditions, or disapproved.

A nonsignificant risk investigational device study does not require FDA approval of an IDE.

Some types of device studies, including many IVD studies, are exempt from IDE requirements altogether.

of device studies are exempt from IDE requirements altogether.

Clinical studies with investigational drugs must be subject to an

approved investigational new drug (IND) exemption.

from FDA oversight, clinical trials that are conducted or supported by the Department of Health and Human Services and many other

federal agencies are subject to the requirements of the Common Rule.

Many institutions that conduct both federally funded and

privately funded research hold a federal-wide assurance from the government stating that all research conducted by the institution

will comply with the Common Rule.

trials must be conducted in accordance with good clinical practice (“GCP”) requirements contained in federal regulations

1 unchanged sentence

Clinical trials, for both significant and nonsignificant risk devices, as well as exempt studies, must

be approved by an IRB, an appropriately constituted group that has been formally designated

to review and monitor biomedical research involving human subjects and which has the authority to approve, require modifications in,

or disapprove research to protect the rights, safety, and welfare of the human research subject.

FDA may order the temporary or permanent discontinuation of a clinical trial at any time or impose other sanctions, if it believes that

the clinical trial either is not being conducted in accordance with FDA requirements or presents an unacceptable risk to the clinical

trial patients.

An IRB may also require the clinical trial it has approved to be halted, either temporarily or permanently, for failure

to comply with the IRB’s requirements or may impose other conditions or sanctions.

be approved by an IRB, an appropriately constituted group that has been formally designated to review and monitor biomedical research

involving human subjects and which has the authority to approve, require modifications in, or disapprove research to protect the rights,

safety, and welfare of the human research subject.

trials that are not conducted in accordance with applicable federal requirements or present an unacceptable risk to participants may

be subject to temporary or permanent discontinuation as well as other sanctions.

An IRB may also require the clinical trial it has approved

to be halted, either temporarily or permanently, for failure to comply with the IRB’s requirements or may impose other conditions

or sanctions.

the QSR does not fully apply to investigational devices, the requirement for controls on design and development does apply.

1 unchanged sentence

of IDE approval that the FDA may impose with respect to manufacturing.

a device is placed on the market, numerous general regulatory controls apply.

These include the QSR, labeling regulations, medical device

reporting regulations (which require that manufacturers report to the FDA if their device may have caused or contributed to a death or

serious injury or malfunctioned in a way that would likely cause or contribute to a death or serious injury if it were to recur), and

reports of corrections and removals regulations (which require manufacturers to report recalls or removals and field corrections to the

FDA if initiated to reduce a risk to health posed by the device or to remedy a violation of the FDCA).

Failure to properly identify reportable

events or to file timely reports, as well as failure to address each of the observations to the FDA’s satisfaction, can subject

a manufacturer to warning letters, recalls, or other sanctions and penalties.

marketing, and promotional activities for devices are also subject to FDA oversight and must comply with the statutory standards of the

FDCA and the FDA’s implementing regulations.

Manufacturers

of medical devices are permitted to promote products solely for the uses and indications set forth in the approved or cleared product

A number of enforcement actions have been taken against manufacturers that promote products for “off-label” uses

(i.e., uses that are not described in the approved or cleared labeling).

of the FDCA relating to inappropriate promotion of medical devices may also lead to investigations alleging violations of federal and

state healthcare fraud and abuse and other laws, as well as state consumer protection laws.

a PMA or Class II 510(k) or de novo device, the FDA also may require postmarketing testing, surveillance, or other measures to

monitor the effects of an approved or cleared product.

The FDA may place conditions on a PMA-approved device that could restrict the

distribution or use of the product.

In addition, quality control, manufacture, packaging, and labeling procedures must continue to conform

to the QSR after approval and clearance, and manufacturers are subject to periodic inspections by the FDA.

Accordingly, manufacturers

must continue to expend time, money, and effort in the areas of production and quality control to maintain compliance with the QSR and

other applicable regulatory requirements.

The FDA may withdraw product approvals or recommend or require product recalls if a company

fails to comply with regulatory requirements.

Investigational drugs must be manufactured in accordance with

good manufacturing practice (GMP) requirements.

of Clinical Trial Information

of clinical trials of FDA-regulated products, including diagnostic and drugs products, are required to register and disclose certain

clinical trial information on the website www.clinicaltrials.gov.

Information related to the product, patient population, phase of investigation,

trial sites, and investigators, and other aspects of a clinical trial are then made public as part of the registration.

also obligated to disclose the results of their clinical trials after completion.

Disclosure of the results of clinical trials can be

delayed in certain circumstances for up to two years after the date of completion of the trial.

Competitors may use this publicly available

information to gain knowledge regarding the progress of clinical development programs as well as clinical trial design.

Approval Process

96 unchanged sentences

that are reviewed within 10 months of the date the FDA files the NDA.

Applications classified

as Priority Review are reviewed within six months of the date the FDA files the NDA.

An NDA can be classified for Priority Review when

the FDA determines the drug has the potential to treat a serious or life-threatening condition and, if approved, would be a significant

improvement in safety or effectiveness compared to available therapies.

The review process for both standard and priority reviews may

be extended by the FDA for three or more additional months to consider certain late-submitted information, or information intended to

clarify information already provided in the NDA submission.

Applications classified as Priority Review are reviewed within

six months of the date the FDA files the NDA.

An NDA can be classified for Priority Review when the FDA determines the drug has the potential

to treat a serious or life-threatening condition and, if approved, would be a significant improvement in safety or effectiveness compared

to available therapies.

The review process for both standard and priority reviews may be extended by the FDA for three or more additional

months to consider certain late-submitted information, or information intended to clarify information already provided in the NDA submission.

FDA may also refer applications for novel products, as well as products that present difficult questions of safety or efficacy, to be

34 unchanged sentences

application, and the FDA uses the same procedures and actions in reviewing NDA supplements as it does in reviewing original NDAs.

of Clinical Trial Information

of clinical trials of FDA-regulated products, including diagnostic and drugs products, are required to register and disclose certain

clinical trial information on the website www.clinicaltrials.gov.

Information related to the product, patient population, phase of investigation,

trial sites, and investigators, and other aspects of a clinical trial are then made public as part of the registration.

also obligated to disclose the results of their clinical trials after completion.

Disclosure of the results of clinical trials can be

delayed in certain circumstances for up to two years after the date of completion of the trial.

Competitors may use this publicly available

information to gain knowledge regarding the progress of clinical development programs as well as clinical trial design.

Post-Approval

42 unchanged sentences

Data Collection

collection and use of personal data (including health data) in the European Economic Area (“EEA”) are governed by the

EU General Data Protection Regulations (“EU GDPR”) and national implementing legislation in EEA member states.

GDPR applies to any company established in the EEA and to companies established outside the EEA that process personal data in connection

with the offering of goods or services to data subjects in the EEA or the monitoring of the behavior of data subjects in the EEA.

EU GDPR establishes stringent requirements applicable to the processing of personal data, including strict requirements relating to the

validity of consent of data subjects, expanded disclosures about how personal data is used, requirements to conduct data protection impact

assessments for “high risk” processing, limitations on retention of personal data, special provisions for “special

categories of personal data” including health and genetic information of data subjects, mandatory data breach notification (in

certain circumstances), “privacy by design” requirements, and direct obligations on service providers acting as processors.

The EU GDPR also prohibits the international transfer of personal data from the EEA to countries outside of the EEA unless made to a

country deemed to have adequate data privacy laws by the European Commission or a data transfer mechanism has been put in place.

to comply with the requirements of the EU GDPR and the related national data protection laws of the EEA states may result in fines up

to 20 million euros or 4% of a company’s global annual revenues for the preceding financial year, whichever is higher.

the EU GDPR affords various data protection rights to individuals (i.e., the right to erasure of personal data) in certain circumstances,

and the ability for data subjects to claim material and non-material damages resulting from infringements of the EU GDPR.

Given the breadth

and depth of changes in data protection obligations, maintaining compliance with the EU GDPR will require significant time, resources,

and expense, and we may be required to put in place additional mechanisms ensuring compliance with the evolving data protection rules.

This may be onerous and adversely affect our business, financial condition, results of operations, and prospects.

collection and use of personal data (including health data) in the European Economic Area (“EEA”) are governed by the EU

General Data Protection Regulations (“EU GDPR”) and national implementing legislation in EEA member states.

The EU GDPR applies

to any company established in the EEA and to companies established outside the EEA that process personal data in connection with the

offering of goods or services to data subjects in the EEA or the monitoring of the behavior of data subjects in the EEA.

establishes stringent requirements applicable to the processing of personal data, including strict requirements relating to the validity

of consent of data subjects, expanded disclosures about how personal data is used, requirements to conduct data protection impact assessments

for “high risk” processing, limitations on retention of personal data, special provisions for “special categories of

personal data” including health and genetic information of data subjects, mandatory data breach notification (in certain circumstances),

“privacy by design” requirements, and direct obligations on service providers acting as processors.

The EU GDPR also prohibits

the international transfer of personal data from the EEA to countries outside of the EEA unless made to a country deemed to have adequate

data privacy laws by the European Commission or a data transfer mechanism has been put in place.

Failure to comply with the requirements

of the EU GDPR and the related national data protection laws of the EEA states may result in fines up to 20 million euros or 4% of a

company’s global annual revenues for the preceding financial year, whichever is higher.

Moreover, the EU GDPR affords various data

protection rights to individuals (i.e., the right to erasure of personal data) in certain circumstances, and the ability for data subjects

to claim material and non-material damages resulting from infringements of the EU GDPR.

Given the breadth and depth of changes in data

protection obligations, maintaining compliance with the EU GDPR will require significant time, resources, and expense, and we may be

required to put in place additional mechanisms ensuring compliance with the evolving data protection rules.

This may be onerous and adversely

affect our business, financial condition, results of operations, and prospects.

of the World Regulation

10 unchanged sentences

from bench to bedside.

Of our seven employees engaged in research and development, all of whom are employed full-time, three hold Ph.Ds

Of our seven employees engaged in research and development, all of whom are employed full-time, two hold Ph.Ds

in biology or medicinal chemistry.

Of the 36 employees at PPLS, nearly 40% have worked at our clinical laboratory for more than five

Our Chief Medical Officer, Gordon Downie, MD, Ph.D, brings more than three

decades of experience in pulmonary medicine, clinical research, medical innovation, and interventional pulmonology to the role.

authored more than 30 peer-reviewed publications, many centered on innovation in bronchoscopy, early lung cancer diagnosis and medical

device development, and worked extensively in both academic medicine and private practice, led FDA-approved research programs, and served

in national leadership roles with the American College of Chest Physicians in the areas of interventional pulmonology, lung cancer, and

medical ethics.

Chief Science Officer, William Bauta, Ph.D., was the Associate Director of Science at Genzyme Corporation and held a similar position

1 unchanged sentence

pipelines, and Manager of Medicinal and Process Chemistry at Southwest Research Institute.

Business development is led by our Chief Operating

Clinical operations are led by our Chief Operating

Officer, Xavier Reveles, who has 25 years of experience as a clinical geneticist skilled in the creation and management of CLIA clinical

4 unchanged sentences

experienced salespeople with a proven record in the pulmonary field.

In November 2023, we hired a National Sales Director

who has more than 15 years of experience in medical sales and marketing, most recently as Executive Account Manager for the respiratory

portfolio of Olympus America’s therapeutic solutions division.

Our innovative and collaborative culture is in part responsible

for our ability to attract and retain highly skilled professionals seeking professional advancement.

Outside partnerships and collaborations

that advance business and scientific research are encouraged, allowing us to multiply workforce efforts without expending significant

Dallas Coleman, Vice President of Sales, brings more than 15 years of experience in medical sales and marketing, including

as Executive Account Manager for the respiratory portfolio of Olympus America’s therapeutic solutions division.

Our innovative

and collaborative culture is in part responsible for our ability to attract and retain highly skilled professionals seeking professional

Outside partnerships and collaborations that advance business and scientific research are encouraged, allowing us to multiply

workforce efforts without expending significant capital.

of Being an Emerging Growth Company and a Smaller Reporting Company

qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act.

as long as we remain an emerging growth company, we may take advantage of specified reduced reporting requirements and other burdens

qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”).

For as long as we remain an emerging growth company, we may take advantage of specified reduced reporting requirements and other burdens

that are otherwise applicable generally to other public companies.

12 unchanged sentences

offering, (2) the last day of the first fiscal year in which our annual gross revenues exceed $1.235 billion, (3) the date on which we

have, during the immediately preceding three-year period, issued more than $1.0 billion in non-convertible debt securities and (4) the

have, during the immediately preceding three-year period, issued more than $1.0 billion in non-convertible debt securities or (4) the

date on which we are deemed to be a large accelerated filer under the rules of the SEC.

11 unchanged sentences

As a result of this election,

our timeline to comply with new or revised accounting standards will in many cases be delayed as compared to other public companies that

our timeline to comply with new or revised accounting standards will in many cases be delayed compared to other public companies that

are not eligible to take advantage of this election or have not made this election.

13 unchanged sentences

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-K

Item 1. Business