What changed in this filing

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Item 1A. Risk Factors

2025-12-23 compared with 2024-12-27 · 1184 added, 912 removed, 645 unchanged (76% of the section changed)

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could decline, and stockholders may lose all or part of their investment.

Risks Related to Our Business and our Industry

Risks Related to Our Financial Position and

Need for Additional Capital

Our independent registered public accounting

firm’s report includes an explanatory paragraph stating that there is substantial doubt about our ability to continue as a going

At September 30, 2025, we estimated that we have

sufficient capital to continue our operations through March 2026, after taking into account the $6.0 million raised by us in October

2025 and the $18.0 million raised by Citius Oncology in December 2025.

You should not rely on our consolidated balance sheet as an indication

of the amount of proceeds that would be available to satisfy claims of creditors, and potentially be available for distribution to stockholders,

in the event of liquidation.

The Company has generated no operating revenue

to date and has principally raised capital through the issuance of debt and equity instruments to finance its operations.

Company’s continued operations beyond March 2026 including its continued commercialization of LYMPHIR (through Citius Oncology)

and its development plans for Mino-Lok, Halo-Lido and NoveCite, will depend on its ability to successfully launch LYMPHIR and/or obtain

regulatory approval to market Mino-Lok and generate substantial revenue from the sale of LYMPHIR and/or Mino-Lok and on its ability to

raise additional capital through various potential sources, such as equity and/or debt financings, strategic relationships, or out-licensing

of its product candidates.

However, the Company can provide no assurances on the commercialization, or future sales of LYMPHIR and/or

the approval, commercialization, or future sales of Mino-Lok or that financing or strategic relationships will be available on acceptable

terms, or at all.

If the Company is unable to raise sufficient capital, find strategic partners or generate substantial revenue from

the sale of LYMPHIR and/or Mino-Lok (if approved), there would be a material adverse effect on its business.

Further, the Company expects

in the future to incur additional expenses as it continues to develop its product candidates, including seeking regulatory approval,

and protecting its intellectual property.

We require substantial additional funding

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Oncology, advance development of LYMPHIR for other indications, and advance development of our other product candidates.

following the Merger, Citius Oncology has additional costs associated with operating as a public company and require additional capital

following the Merger, Citius Oncology has additional costs associated with operating as a public company and requires additional capital

to fund our other operating expenses and capital expenditures.

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but not limited to, partnerships, joint ventures, mergers, acquisitions, licensing or other strategic transactions.

As of September 30, 2024, our cash and cash equivalents

were $3,251,880 and we had an accumulated deficit of $201,370,218.

The amount and timing of our future funding requirements will depend

on many factors, some of which are outside of our control, including but not limited to:

● the costs and expenses associated with our ongoing

commercialization efforts for LYMPHIR, including the costs of establishing or contracting for sales, marketing, and distribution capabilities

● the degree of success we experience in commercializing

● the revenue generated by sales of LYMPHIR and

other future product candidates that may be approved, if any;

● the extent to which LYMPHIR or any of our other

potential product candidates, if approved for commercialization, is adopted by the physician community;

● the effect of competing products and product

candidates and other market developments;

● the scope, progress, results and costs of conducting

studies and clinical trials for our other future product candidates, if any, resulting from our ongoing research with LYMPHIR for other

possible indications;

● the timing of, and the costs involved in, obtaining

regulatory approvals for our product candidates;

● the costs of manufacturing LYMPHIR and any other

potential product candidates we develop;

● the timing and amount of any milestone, royalty

or other payments we are required to make pursuant to any current or future license agreements;

● the number and types of future product candidates

we might develop and commercialize;

● any product liability or other lawsuits related

to our products;

● the expenses needed to attract, hire and retain

skilled personnel;

● the costs associated with being a public company;

● costs of preparing, filing and prosecuting patent

applications and maintaining, enforcing and defending intellectual property-related claims;

● the extent and scope of our general and administrative

As of September 30, 2025, and without giving

effect to subsequent capital raises in October and December 2025, our cash and cash equivalents were approximately $4.3 million and we

had an accumulated deficit of approximately $238.8 million.

The amount and timing of our future funding requirements will depend on many

factors, some of which are outside of our control, including but not limited to:

the costs and expenses

associated with our ongoing commercialization efforts for LYMPHIR, including the continuing costs of maintaining or contracting for

sales, marketing, and distribution capabilities for LYMPHIR;

the degree of success we

experience in commercializing LYMPHIR;

the revenue generated by

sales of LYMPHIR and other future product candidates that may be approved, if any;

the extent to which LYMPHIR

or any of our other potential product candidates, if approved for commercialization, is adopted by the physician community;

the effect of competing

products and product candidates and other market developments;

the scope, progress, results

and costs of conducting studies and clinical trials for our other future product candidates, if any, resulting from our ongoing research

with LYMPHIR for other possible indications;

the timing of, and the

costs involved in, obtaining regulatory approvals for our product candidates;

the costs of manufacturing

LYMPHIR and any other potential product candidates we develop;

the timing and amount of

any milestone, royalty or other payments we are required to make pursuant to any current or future license agreements;

the number and types of

future product candidates we might develop and commercialize;

any product liability or

other lawsuits related to our products;

the expenses needed to

attract, hire and retain skilled personnel;

the costs associated with

being a public company;

costs of preparing, filing

and prosecuting patent applications and maintaining, enforcing and defending intellectual property-related claims;

the extent and scope of

our general and administrative expenses.

Until we are able to generate significant revenue,

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marketing approval for and generate revenues from sales of our product candidates.

We have been focused on product development, have not

received approval for any of our product candidates, and have not generated any revenues to date.

Our subsidiary, Citius Oncology, received

approval for LYMPHIR in August 2024 and has not generated any revenues to date.

We have incurred losses in each period of our operations,

and we expect to continue to incur losses for the foreseeable future.

These losses are likely to continue to adversely affect our working

capital, total assets, and stockholders’ equity.

The process of developing our product candidates requires significant clinical

development, laboratory testing and clinical trials.

In addition, commercialization of our product candidates will require that we obtain

necessary regulatory approvals and establish sales, marketing, and manufacturing capabilities, either through internal hiring or through

contractual relationships with others.

We expect to incur substantial losses for the foreseeable future as a result of anticipated increases

in our research and development costs, including costs associated with conducting preclinical testing and clinical trials, and regulatory

compliance activities.

We expect Citius Oncology to begin generating revenues following the launch of LYMPHIR in the first half of 2025.

We incurred net losses of $39,138,839 and $32,542,912 for the years ended September 30, 2024 and 2023, respectively.

At September 30,

2024, we had stockholders’ equity of $74,101,830 and an accumulated deficit of $201,370,218.

Our net cash used in operating activities

was $28,201,375 and $29,060,212 for the years ended September 30, 2024 and 2023, respectively.

As of September 30, 2024, we had outstanding liabilities

of $33.3 million and outstanding commitments of $21.8 million to third parties for LYMPHIR licensing, supply and other costs, that, if

left unpaid, could result in a delay in the commercialization of LYMPHIR, breach of contract, loss of licensing rights or other events

that would have a material adverse effect on our business and operations.

Our ability to generate revenues and achieve profitability

will depend on numerous factors, including success in:

Citius Oncology successfully commercializing LYMPHIR;

developing and testing product candidates;

receiving regulatory approvals for our other product candidates;

commercializing our other product candidates that receive regulatory approval;

manufacturing commercial quantities of our products and product candidates at acceptable cost levels;

obtaining medical insurance coverage for any approved product candidate;

establishing a favorable competitive position for any approved product candidates.

We have been focused on product development, have

not received approval for any of our product candidates, and have not generated any revenues to date.

Our subsidiary, Citius Oncology,

received approval for LYMPHIR in August 2024 and launched LYMPHIR in December 2025, but has not generated any revenues to date.

incurred losses in each period of our operations, and we expect to continue to incur losses for the foreseeable future.

are likely to continue to adversely affect our working capital, total assets, and stockholders’ equity.

The process of developing

our product candidates requires significant clinical development, laboratory testing and clinical trials.

In addition, commercialization

of our product candidates will require that we obtain necessary regulatory approvals and establish sales, marketing, and manufacturing

capabilities, either through internal hiring or through contractual relationships with others.

We expect to incur substantial losses

for the foreseeable future as a result of anticipated increases in our research and development costs, including costs associated with

conducting preclinical testing and clinical trials, and regulatory compliance activities.

We expect Citius Oncology to begin generating

revenues following the launch of LYMPHIR, which occurred in December 2025.

We incurred net losses of $39,740,269 and $39,425,839 for

the years ended September 30, 2025 and 2024, respectively.

At September 30, 2025, we had stockholders’ equity of $77,527,600 and

an accumulated deficit of $238,804,129.

Our net cash used in operating activities was $26,552,738 and $28,201,375 for the years ended

September 30, 2025 and 2024, respectively.

As of September 30, 2025, we had outstanding

liabilities of $38.4 million and outstanding commitments of $22.7 million to third parties for LYMPHIR licensing, supply and other costs,

that, if left unpaid, could result in an interruption in the commercialization of LYMPHIR, breach of contract, loss of licensing rights

or other events that would have a material adverse effect on our business and operations.

Our ability to generate revenues and achieve

profitability will depend on numerous factors, including success in:

Citius Oncology

successfully commercializing LYMPHIR;

developing and testing

product candidates;

receiving regulatory approvals

for our other product candidates;

commercializing our other

product candidates that receive regulatory approval;

manufacturing

commercial quantities of our products and product candidates at acceptable cost levels;

obtaining medical insurance

coverage for any approved product candidate;

establishing a favorable

competitive position for any approved product candidates.

Many of these factors will depend on circumstances

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We and Citius Oncology continue to evaluate strategic

paths to provide the resources necessary to commercialize LYMPHIR and maximize stockholder value.

Potential strategic paths may include

partnerships, joint ventures, mergers, acquisitions, or licensing transactions, a combination of these, or other strategic transactions.

There can be no assurance, however, that our evaluation will result in transactions or other alternatives, even when deemed necessary.

There is no set timetable for our strategic process, and we do not intend to provide updates unless or until the Board of Directors approves

a specific action or otherwise determines that disclosure is appropriate or necessary.

Any potential transaction would be dependent on

a number of factors that may be beyond our control, including, among other things, market conditions, industry trends, the interest of

third parties in a potential transaction with us, obtaining stockholder approval and the availability of financing to third parties in

a potential transaction with us on reasonable terms.

The process of reviewing alternative strategic paths may be time consuming and may

involve the dedication of significant resources and may require us to incur significant costs and expenses.

paths to provide the resources necessary to successfully commercialize LYMPHIR, continue the development of our other product candidates,

and maximize stockholder value.

Potential strategic paths may include partnerships, joint ventures, mergers, acquisitions, or licensing

transactions, a combination of these, or other strategic transactions.

There can be no assurance, however, that our evaluation will result

in transactions or other alternatives, even when deemed necessary.

There is no set timetable for our strategic process, and we do not

intend to provide updates unless or until the Board approves a specific action or otherwise determines that disclosure is appropriate

or necessary.

Any potential transaction would be dependent

on a number of factors that may be beyond our control, including, among other things, market conditions, industry trends, the interest

of third parties in a potential transaction with us, obtaining stockholder approval and the availability of financing to third parties

in a potential transaction with us on reasonable terms.

The process of reviewing alternative strategic paths may be time consuming and

may involve the dedication of significant resources and may require us to incur significant costs and expenses.

It could negatively impact

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There can be no guarantee

that the process of evaluating alternative strategic paths will result in our Company or Citius Oncology entering into or completing potential

transactions within the anticipated timing or at all.

that the process of evaluating alternative strategic paths will result in our Company or Citius Oncology entering into or completing

potential transactions within the anticipated timing or at all.

In the event we or Citius Oncology do not

successfully complete a strategic transaction, should this be deemed necessary, our Board of Directors may decide to pursue a dissolution

and liquidation of our Company.

In such an event, the amount of cash available for distribution to our stockholders will depend heavily

on the timing of such liquidation as well as the amount of cash that will need to be reserved for commitments and contingent liabilities.

successfully complete a strategic transaction, should this be deemed necessary, our Board may decide to pursue a dissolution and liquidation

of our Company.

In such an event, the amount of cash available for distribution to our stockholders will depend heavily on the timing

of such liquidation as well as the amount of cash that will need to be reserved for commitments and contingent liabilities.

There can be no guarantee that the process to

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If additional transactions are not

completed that enable us or Citius Oncology to continue the commercialization of LYMPHIR and sustain our business operations, our Board

of Directors may decide that it is in the best interest of our stockholders to dissolve our Company and liquidate our assets.

event, the amount of cash available for distribution to our stockholders will depend heavily on the timing of such decision and, ultimately,

such liquidation since the amount of cash available for distribution continues to decrease as we fund our operations and evaluate our

strategic alternatives.

In addition, if our Board were to approve and recommend, and our stockholders were to approve, a dissolution of

our Company, we would be required under Delaware corporate law to pay our outstanding obligations, as well as to make reasonable provision

for contingent and unknown obligations, prior to making any distributions in liquidation to our stockholders.

As a result of this requirement,

a portion of our assets may need to be reserved pending the resolution of such obligations.

In addition, we may be subject to litigation

or other claims related to a dissolution and liquidation of our Company.

If a dissolution and liquidation were pursued, our Board, in

consultation with its advisors, would need to evaluate these matters and make a determination about a reasonable amount to reserve.

holders of our common stock could lose all or a significant portion of their investment in the event of a dissolution, liquidation or

winding up of our Company.

Our independent registered public accounting

firm’s report includes an explanatory paragraph stating that there is substantial doubt about our ability to continue as a going

At September 30, 2024, we estimated that we have

sufficient capital to continue our operations through February 2025.

You should not rely on our consolidated balance sheet as an indication

of the amount of proceeds that would be available to satisfy claims of creditors, and potentially be available for distribution to stockholders,

in the event of liquidation.

The Company has generated no operating revenue

to date and has principally raised capital through the issuance of debt and equity instruments to finance its operations.

Company’s continued operations beyond February 2025 including its commercialization of LYMPHIR (through Citius Oncology) and its

development plans for Mino-Lok, Halo-Lido and NoveCite, will depend on its ability to successfully launch LYMPHIR and/or obtain regulatory

approval to market Mino-Lok and generate substantial revenue from the sale of LYMPHIR and/or Mino-Lok and on its ability to raise additional

capital through various potential sources, such as equity and/or debt financings, strategic relationships, or out-licensing of its product

However, the Company can provide no assurances on the approval, commercialization, or future sales of LYMPHIR and/or Mino-Lok

or that financing or strategic relationships will be available on acceptable terms, or at all.

If the Company is unable to raise sufficient

capital, find strategic partners or generate substantial revenue from the sale of LYMPHIR and/or Mino-Lok, there would be a material adverse

effect on its business.

Further, the Company expects in the future to incur additional expenses as it continues to develop its product

candidates, including seeking regulatory approval, and protecting its intellectual property.

Citius Oncology could be delayed in the

launch of LYMPHIR.

While we believe we have sufficient funds on hand

to commercially launch LYMPHIR, various factors could increase the cost to launch LYMPHIR, which we expect would require us to obtain

additional capital to complete those efforts.

completed that enable us or Citius Oncology to successfully commercialize LYMPHIR and sustain our business operations, our Board may

decide that it is in the best interest of our stockholders to dissolve our Company and liquidate our assets.

In that event, the amount

of cash available for distribution to our stockholders will depend heavily on the timing of such decision and, ultimately, such liquidation

since the amount of cash available for distribution continues to decrease as we fund our operations and evaluate our strategic alternatives.

In addition, if our Board were to approve and recommend, and our stockholders were to approve, a dissolution of our Company, we would

be required under Nevada corporate law to pay our outstanding obligations, as well as to make reasonable provision for contingent and

unknown obligations, prior to making any distributions in liquidation to our stockholders.

As a result of this requirement, a portion

of our assets may need to be reserved pending the resolution of such obligations.

In addition, we may be subject to litigation or other

claims related to a dissolution and liquidation of our Company.

If a dissolution and liquidation were pursued, our Board, in consultation

with its advisors, would need to evaluate these matters and make a determination about a reasonable amount to reserve.

Accordingly, holders

of our common stock could lose all or a significant portion of their investment in the event of a dissolution, liquidation or winding

up of our Company.

Risks Related to Our Business and our Industry

If we are unable

to execute our commercial strategy for LYMPHIR, fail to satisfy the conditions of our marketing approval for LYMPHIR, or if we experience

significant delays in accomplishing such goals, our business will be materially harmed.

have invested a significant portion of our efforts and financial resources to bring LYMPHIR to market.

Our ability to generate product

revenues will depend heavily on the successful commercialization of LYMPHIR.

Further, while we believe we have sufficient funds

on hand for the successful commercialization of LYMPHIR, which began with its launch in December 2025, various factors could increase

the cost to successfully commercialize LYMPHIR, which we expect would require us to obtain additional capital to complete those efforts.

Financing might not be available on acceptable terms or at all.

We need to secure additional financing in

the future to complete the development of our other current product candidates and support our operations.

If we do not receive

new marketing approvals in other jurisdictions for LYMPHIR, our ability to generate additional revenue will be jeopardized and, consequently,

our business will be materially harmed.

Additionally, our ability to make LYMPHIR available within the U.S.

is largely dependent upon

the maintenance of our marketing approval.

The success of LYMPHIR will depend on a number of additional factors, including the following:

ability to negotiate, secure and maintain adequate pricing, coverage and reimbursement terms

on a timely basis, or at all;

timing, scope and outcome of our commercial launch in the U.S.

and in other potential jurisdictions;

maintenance and expansion of a commercial infrastructure capable of supporting product sales,

marketing and distribution;

implementation and maintenance of marketing and distribution relationships with third parties;

ability to establish and maintain commercial manufacturing arrangements with third-party

manufacturers;

ability or the ability of our third-party manufacturers to successfully produce commercial

and clinical supply of LYMPHIR on a timely basis sufficient to meet the needs of our commercial

and clinical activities;

identification of eligible patients;

of LYMPHIR as a treatment for the approved indication by patients, the medical community

and third-party payors;

● effectively

competing with other therapies;

trade policies;

continued acceptable safety profile of LYMPHIR;

costs, timing and outcome of post-marketing studies and trials required for LYMPHIR;

our rights in our intellectual property portfolio, obtaining and maintaining regulatory exclusivity;

ability to successfully prepare and advance regulatory submissions for marketing approval

for LYMPHIR in additional territories and for additional or expanded indications and whether

and in what timeframe we may obtain such approval.

If we do not achieve

one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to continue to commercialize

our products, either of which would have a material adverse effect on our business, results of operations and financial condition.

We need to secure additional financing

in the future to complete the development of our other current product candidates and support our operations.

We anticipate that we will incur operating losses

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timing of our future funding requirements will depend on many factors, including, but not limited to:

the rate of progress and cost of our trials and other product development and commercialization programs for our current product candidates;

the costs and timing of obtaining licenses for additional product candidates or acquiring other complementary technologies;

the timing of any regulatory approvals of any of our product candidates;

the costs of establishing or contracting for sales, marketing, and distribution capabilities for our product candidates;

the status, terms and timing of any collaborative, licensing, co-promotion, or other arrangements.

We will need to access the capital markets in

the near future for additional capital for research and development and for operations.

Traditionally, pharmaceutical companies have funded

their research and development expenditures through raising capital in the equity markets.

Declines and uncertainties in these markets

over the past several years have severely restricted raising new capital and have affected companies’ abilities to continue to expand

or fund existing research and development efforts.

If economic conditions continue to be uncertain or become worse, our future cost of

equity or debt capital and access to the capital markets could be adversely affected.

the rate of progress and

cost of our trials and other product development and commercialization programs for our current product candidates;

the costs and timing of

obtaining licenses for additional product candidates or acquiring other complementary technologies;

the timing of any regulatory

approvals of any of our product candidates;

the costs of establishing

or contracting for sales, marketing, and distribution capabilities for our product candidates;

the status, terms and timing

of any collaborative, licensing, co-promotion, or other arrangements.

We expect to need to access the capital markets

in the near future for additional capital for research and development and for operations.

Traditionally, pharmaceutical companies have

funded their research and development expenditures through raising capital in the equity markets.

Declines and uncertainties in these

markets over the past several years have severely restricted raising new capital and have affected companies’ abilities to continue

to expand or fund existing research and development efforts.

If economic conditions continue to be uncertain or become worse, our future

cost of equity or debt capital and access to the capital markets could be adversely affected.

If we are not successful in securing additional

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collaborative partners or others that may require us to relinquish rights to certain of our technologies or product candidates.

We are primarily a late-stage development

company with an unproven business strategy and may never achieve commercialization of our therapeutic product candidates or profitability.

We are primarily a commercial and late-stage

development company with an unproven business strategy and may never achieve commercialization of all our therapeutic product candidates

or profitability.

Citius Pharma has no approved products.

Our subsidiary,

Citius Oncology, received approval for LYMPHIR in August 2024 and has not generated any revenues to date.

All other current product candidates

of Citius Pharma are in the pre-clinical or clinical stage.

We rely on third parties to conduct the research and development activities

for our product candidates and our product commercialization capabilities are unproven.

We, through Citius Oncology, are developing our

sales and marketing capabilities at this time for LYMPHIR and have contracted with Innovation Partners, a large third-party commercial

sales and marketing organization with an existing commercial infrastructure and product launch experience to assist in our commercial

efforts related to LYMPHIR.

We have no sales or marketing capabilities with respect to our other product candidates.

Our success will

depend upon our ability to develop such capabilities on our own or to enter into and maintain collaboration agreements on favorable terms

and to select an appropriate commercialization strategy for each product candidate that we choose to pursue and that receives approval,

whether on our own or in collaboration.

If we are not successful in implementing our strategy to commercialize our product candidates,

we may never achieve, maintain, or increase profitability.

Our ability to successfully commercialize any of our product candidates will

depend, among other things, on our ability to:

successfully complete pre-clinical and clinical trials for our product candidates;

receive marketing approvals from the FDA and similar foreign regulatory authorities for our product candidates;

establish commercial manufacturing arrangements with third-party manufacturers for our product candidates;

produce, through a validated process, sufficiently large quantities of our drug compound(s) to permit successful commercialization of our product candidates;

build and maintain strong sales, distribution, and marketing capabilities sufficient to launch commercial sales of any approved products or establish collaborations with third parties for such commercialization;

secure acceptance of any approved products from physicians, health care payers, patients, and the medical community;

manage our spending as costs and expenses increase due to clinical trials, regulatory applications and development and commercialization activities.

Citius Oncology, received approval for LYMPHIR in August 2024 and launched LYMPHIR in December 2025, but has not generated any revenues

All other current product candidates of Citius Pharma are in the pre-clinical or clinical stage.

We rely on third parties to

conduct the research and development activities for our product candidates and our product commercialization capabilities are unproven.

We, through Citius Oncology, have developed our sales and marketing capabilities for LYMPHIR and have contracted with Innovation Partners,

a large third-party commercial sales and marketing organization with an existing commercial infrastructure and product launch experience

to assist in our commercial efforts related to LYMPHIR.

Citius Oncology also has distribution agreements with three national companies

and an agreement with EVERSANA to support the launch and commercialization of LYMPHIR.

Citius Pharma has no sales or marketing capabilities

with respect to our other product candidates.

Our success will depend upon the sales and marketing infrastructure developed by Citius

Oncology for LYMPHIR and also on Citius Pharma’s ability to develop such capabilities on its own or to enter into and maintain

collaboration agreements on favorable terms and to select an appropriate commercialization strategy for each product candidate that it

chooses to pursue and that receives approval, whether on its own or in collaboration.

If we are not successful in implementing our strategy

to commercialize our product candidates, we may never achieve, maintain, or increase profitability.

Our ability to successfully commercialize

any of our other product candidates will depend, among other things, on our ability to:

successfully complete pre-clinical

and clinical trials for our product candidates;

receive marketing approvals

from the FDA and similar foreign regulatory authorities for our product candidates;

establish commercial manufacturing

arrangements with third-party manufacturers for our product candidates;

produce, through a validated

process, sufficiently large quantities of our drug compound(s) to permit successful commercialization of our product candidates;

build and maintain strong

sales, distribution, and marketing capabilities sufficient to launch commercial sales of any approved products or establish collaborations

with third parties for such commercialization;

secure acceptance of any

approved products from physicians, health care payers, patients, and the medical community;

manage our spending as

costs and expenses increase due to clinical trials, regulatory applications and development and commercialization activities.

There are no guarantees that we will be successful

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which to evaluate our ability to successfully commercialize our product candidates.

Citius Oncology has one recently approved but

not yet launched product, LYMPHIR, and Citius Pharma has one late-stage stage product candidate, Mino-Lok, while our other product candidates

are clinical stage.

As a result, our success is dependent upon our ability to obtain regulatory approval for and commercialize our product

candidates and we, as a company, have not demonstrated an ability to perform the functions necessary for the approval or successful commercialization

of any product candidates.

While various members of our executive management and key employees have significant prior experience in pharmaceutical

development, as a company we have to date successfully completed only one late-stage clinical trial (much of which had been undertaken

by Eisai prior to our in-licensing of the intellectual property of LYMPHIR) and are just beginning to undertake commercialization activities,

in each case for LYMPHIR (through Citius Oncology).

Despite our progress with LYMPHIR, our operations have been limited primarily to business

planning, acquiring our proprietary technology, research and development, recruiting management and technical staff, and raising capital.

These operations provide a limited basis for you to assess our ability to successfully commercialize our product candidates and the advisability

of investing in our securities.

Citius Oncology has only recently launched its

one product, LYMPHIR.

Citius Pharma has one late-stage stage product candidate, Mino-Lok, while our other product candidates are clinical

As a result, our success is dependent upon Citius Oncology’s success in commercializing LYMPHIR and Citius Pharma’s

ability to obtain regulatory approval for and commercialize our product candidates and we, as a company, have not demonstrated an ability

to perform the functions necessary for the successful commercialization of any product candidates, given the recent launch of LYMPHIR.

While various members of our executive management and key employees have significant prior experience in pharmaceutical development,

as a company we have to date successfully completed only one late-stage clinical trial (much of which had been undertaken by Eisai prior

to our in-licensing of the intellectual property of LYMPHIR) and have just launched LYMPHIR (through Citius Oncology).

Despite our progress

with LYMPHIR, our operations have been limited primarily to business planning, acquiring our proprietary technology, research and development,

recruiting management and technical staff, and raising capital.

These operations provide a limited basis for you to assess our ability

to successfully commercialize our product candidates and the advisability of investing in our securities.

We may choose not to continue developing

any of our product candidates at any time during development, which would reduce or eliminate our potential return on investment for those

product candidates.

any of our product candidates at any time during development, which would reduce or eliminate our potential return on investment for

those product candidates.

At any time, we may decide to discontinue the

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return on our investment and we will have missed the opportunity to allocate those resources to potentially more productive uses.

As an example, on July 1, 2016, we announced that

we were discontinuing the development of Suprenza, which was our first commercial product candidate, for strategic reasons and not due

to safety or regulatory concerns, in order to focus our management and cash resources on the Phase 3 development of Mino-Lok and the Phase

2b development of Halo-Lido.

As an example, on July 1, 2016, we announced

that we were discontinuing the development of Suprenza, which was our first commercial product candidate, for strategic reasons and not

due to safety or regulatory concerns, in order to focus our management and cash resources on the Phase 3 development of Mino-Lok and

the Phase 2b development of Halo-Lido.

Further, in December 2023, we terminated development of Mino-Wrap to devote resources to the development

of LYMPHIR, The resources expended on Suprenza and Mino-Wrap therefore did not provide us any benefit.

The resources expended on Suprenza and Mino-Wrap therefore did not provide us any benefit.

We face significant risks in our product

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will receive regulatory approval and achieve market acceptance.

For example, while LYMPHIR received FDA approval in August 2024, we had

incurred significant expenses in its development and planned commercialization;

as of September 30, 2024, we had outstanding commitments

of approximately $50.6 million to third parties for LYMPHIR licensing, supply and other costs.

As an example, in response to the submission of our BLA for LYMPHIR,

the FDA issued a complete response letter (“CRL”) on July 28, 2023.

The FDA required us to incorporate enhanced product testing

and additional controls agreed to with the FDA during the market application review.

There were no concerns relating to the safety and

efficacy clinical data package submitted with the BLA, or the proposed prescribing information.

In September 2023, we announced that

the FDA had agreed with our plans to address the requirements outlined in the CRL, which guidance provided us with a path for completing

the necessary activities to support the resubmission of the BLA for LYMPHIR and we received approval from the FDA in August 2024.

Product candidates that appear to be promising

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to achieve market acceptance.

While we anticipate that Citius Oncology will

launch LYMPHIR in the first half of 2025, that timeline is subject to change for various reasons.

Moreover, we cannot predict whether

or when we will obtain regulatory approval to commercialize our other product candidates that are under development, notably Mino-Lok.

We cannot, therefore, predict the timing of any future revenues from LYMPHIR or any other product candidate.

As an example, in response

to the submission of our BLA for LYMPHIR, the FDA issued a complete response letter (“CRL”) on July 28, 2023.

The FDA required

us to incorporate enhanced product testing and additional controls agreed to with the FDA during the market application review.

were no concerns relating to the safety and efficacy clinical data package submitted with the BLA, or the proposed prescribing information.

In September 2023, we announced that the FDA had agreed with our plans to address the requirements outlined in the CRL, which guidance

provided us with a path for completing the necessary activities to support the resubmission of the BLA for LYMPHIR and we received approval

from the FDA in August 2024.

We cannot predict whether or when we will obtain

regulatory approval to commercialize our other product candidates that are under development, notably Mino-Lok.

In addition, we expect

that it will take time for LYMPHIR to be accepted in the market, generate revenues and a return on investment.

For example, while LYMPHIR

received FDA approval in August 2024, we had incurred significant expenses in its development and planned commercialization prior to

its launch in December 2025;

as of September 30, 2025, we had outstanding commitments of approximately $21.1 million to third parties

for LYMPHIR licensing, supply and other costs.

We cannot, therefore, predict the timing of any future revenues from LYMPHIR or any other

product candidate.

The FDA has substantial discretion in the drug

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For example, the FDA:

may not find the data from clinical trials sufficient to support the submission of an NDA or BLA or to obtain marketing approval in the U.S., including any findings that the clinical and other benefits of our product candidates outweigh their safety risks;

could determine that the information provided by us was inadequate, contained clinical deficiencies or otherwise failed to demonstrate the safety and effectiveness of any of our product candidates for any indication;

may disagree with our trial design or our interpretation of data from preclinical studies or clinical trials, or may change the requirements for approval even after it has reviewed and commented on the design for our trials;

could determine that we cannot rely on Section 505(b)(2) for Mino-Lok or Halo-Lido or any future product candidate whose composition includes components previously approved by the FDA;

may determine that we have identified the wrong reference listed drug or drugs or that approval of a Section 505(b)(2) application for any of our product candidates is blocked by patent or non-patent exclusivity of the reference listed drug or drugs;

may identify deficiencies in the manufacturing processes or facilities of third-party manufacturers with which we enter into agreements for the manufacture of our product candidates;

may approve our product candidates for fewer or more limited indications than we request, or may grant approval contingent on the performance of costly post-approval clinical trials;

may change its approval policies or adopt new regulations that could adversely impact our product candidate development programs;

may not approve the labeling claims that we believe are necessary or desirable for the successful commercialization of our product candidates, or may require labeling claims that impair the potential market acceptance of our product candidates.

These same risks are generally applicable to the

regulatory process in foreign countries.

Any failure to obtain regulatory approval of our product candidates would significantly limit

our ability to generate revenues, and any failure to obtain such approval for all of the indications and labeling claims we deem desirable

could reduce our potential revenues.

may not find the data from

clinical trials sufficient to support the submission of an NDA or BLA or to obtain marketing approval in the U.S., including any

findings that the clinical and other benefits of our product candidates outweigh their safety risks;

could determine that the

information provided by us was inadequate, contained clinical deficiencies or otherwise failed to demonstrate the safety and effectiveness

of any of our product candidates for any indication;

may disagree with our trial

design or our interpretation of data from preclinical studies or clinical trials, or may change the requirements for approval even

after it has reviewed and commented on the design for our trials;

could determine that we

cannot rely on Section 505(b)(2) for Mino-Lok or Halo-Lido or any future product candidate whose composition includes components

previously approved by the FDA;

may determine that we have

identified the wrong reference listed drug or drugs or that approval of a Section 505(b)(2) application for any of our product candidates

is blocked by patent or non-patent exclusivity of the reference listed drug or drugs;

may identify deficiencies

in the manufacturing processes or facilities of third-party manufacturers with which we enter into agreements for the manufacture

of our product candidates;

may approve our product

candidates for fewer or more limited indications than we request, or may grant approval contingent on the performance of costly post-approval

clinical trials;

may change its approval

policies or adopt new regulations that could adversely impact our product candidate development programs;

may not approve the labeling

claims that we believe are necessary or desirable for the successful commercialization of our product candidates, or may require

labeling claims that impair the potential market acceptance of our product candidates.

These same risks are generally applicable to

the regulatory process in foreign countries.

Any failure to obtain regulatory approval of our product candidates would significantly

limit our ability to generate revenues, and any failure to obtain such approval for all of the indications and labeling claims we deem

desirable could reduce our potential revenues.

We, through Citius Oncology, may be required

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Under the terms of the License Agreement with

Eisai, Citius Oncology is required to pay Eisai a $5.9 million development milestone payment upon initial approval by the FDA of LYMPHIR

Eisai, Citius Oncology was required to pay Eisai a $5.9 million development milestone payment upon initial approval by the FDA of LYMPHIR

for the CTCL indication, which occurred in August 2024, and an aggregate of up to $22 million related to the achievement of net product

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indication and immuno-oncology indication, (ii) initiate two investigator initiated immuno-oncology trials, (iii) use commercially reasonable

efforts to achieve each of the approval milestones, and (iv) complete each specified immuno-oncology investigator trial on or before September

1, 2025, the four-year anniversary of the effective date of the definitive agreement.

Additionally, Citius Oncology is required to commercially

launch a product in a territory within six months of receiving regulatory approval for such product in each such jurisdiction.

Pharmaceuticals, Inc.

(the “Company”) is a guarantor of the obligations of Citius Oncology, Inc.

under the Asset Purchase

efforts to achieve each of the approval milestones, and (iv) complete each specified immuno-oncology investigator trial on or before

September 1, 2025, the four-year anniversary of the effective date of the definitive agreement.

Additionally, Citius Oncology is required

to commercially launch a product in a territory within six months of receiving regulatory approval for such product in each such jurisdiction;

the launch of LYMPHIR in December 2025 satisfied this requirement in the U.S.

Citius Pharma is a guarantor of the obligations of Citius

Oncology under the Asset Purchase Agreement.

Pending further discussions with Dr.

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These development

and milestone obligations impose substantial additional costs on us, and could divert resources from other aspects of the business, and

and milestone obligations impose substantial additional costs on us, and could divert resources from other aspects of our business and

adversely affect the overall profitability of LYMPHIR.

We, through Citius Oncology, need to obtain additional financing to satisfy these

milestone payments, and cannot be sure that any additional funding, will be available on favorable terms, or at all.

A material breach or default under any of

our license agreements, including failure to make timely payments when due, gives the licensor party to such agreement the right to terminate

the license agreement, which termination would materially harm our business.

milestone payments, and cannot be sure that any additional funding will be available on terms favorable to us, or at all.

On March 28, 2025, Citius

Oncology and Eisai entered into a letter agreement that amended the license agreement to provide for a payment schedule to Eisai for the

milestone payment and certain unpaid invoices.

We agreed to pay Eisai on or before July 15, 2025, an aggregate amount of $2,535,318 and

thereafter on the 15th of each of the next four months to pay Eisai $2.35 million and make a final payment of $2,197,892 to Eisai on or

before December 15, 2025, in each case with interest on each obligation from its original due date through the date of actual payment

under the letter agreement at the rate of 2% per annum.

During the year ended September 30, 2025, we recorded $218,032 in interest expense

under the agreement.

The parties released each other from any and all claims, losses, damages, costs and expenses that arise from or related

to our failure to pay the milestone payment or the other incurred costs under the license agreement except for any claims arising out

of a breach of the letter agreement.

All other terms of the license agreement remain in full force and effect.

During the year ended September

30, 2025 we paid $3 million of the development milestone and the balance of $2.9 million is included in license fee payable at September

On July 21, 2025, we made a payment to Eisai of $1,616,522 for other invoices and accumulated interest associated with the letter

A material breach or default under any

of our license agreements, including failure to make timely payments when due, gives the licensor party to such agreement the right to

terminate the license agreement, which termination would materially harm our business.

Our commercial success will depend in part on

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will impose on us, various diligence, milestone payment, royalty and other obligations.

For example, under the license agreement and related

purchase agreement for the intellectual property for LYMPHIR, we, through our subsidiary Citius Oncology, are required to use commercially

reasonable diligence to develop and commercialize a product and to satisfy specified payment obligations for various developmental and

regulatory milestones.

Specifically, upon the approval of LYMPHIR, we, through Citius Oncology, became subject to the payment of an aggregate

of $28.4 million under the license agreements covering LYMPHIR.

Pending further discussions with Dr.

agreed to a partial deferral without penalty of a milestone payment by us, which was triggered upon regulatory approval of LYMPHIR by

the FDA and due on September 9, 2024, pursuant to the terms of the Asset Purchase Agreement.

For example, under the license agreement and

related purchase agreement for the intellectual property for LYMPHIR, we, through our subsidiary Citius Oncology, are required to use

commercially reasonable diligence to develop and commercialize a product and to satisfy specified payment obligations for various developmental

and regulatory milestones.

Specifically, upon the approval of LYMPHIR, we, through Citius Oncology, became subject to the payment of

an aggregate of $33.4 million under the license and asset purchase agreements covering LYMPHIR.

At the time of the FDA

approval for LYMPHIR, a $27.5 million milestone became payable to Dr.

Reddy’s, of which a balance of $19.75 million included in

license fee payable, remained due as of September 30, 2025.

After discussions, Dr.

Reddy’s agreed to a partial deferral without

penalty of this milestone payment.

During the years ended September 30, 2025 and 2024, we paid $2,750,000 and $5,000,000, respectively,

against the outstanding milestone fee.

On March 28, 2025, Citius

Oncology and Eisai entered into a letter agreement that amended the license agreement to provide for a payment schedule to Eisai for

the milestone payment and certain unpaid invoices.

We agreed to pay Eisai on or before July 15, 2025, an aggregate amount of $2,535,318

and thereafter on the 15th of each of the next four months to pay Eisai $2.35 million and make a final payment of $2,197,892 to Eisai

on or before December 15, 2025, in each case with interest on each obligation from its original due date through the date of actual payment

under the letter agreement at the rate of 2% per annum.

During the year ended September 30, 2025, we recorded $218,032 in interest expense

under the agreement.

The parties released each other from any and all claims, losses, damages, costs and expenses that arise from or

related to our failure to pay the milestone payment or the other incurred costs under the license agreement except for any claims arising

out of a breach of the letter agreement.

All other terms of the license agreement remain in full force and effect.

During the year ended

September 30, 2025 we paid $3 million of the development milestone and the balance of $2.9 million is included in license fee payable

at September 30, 2025.

On July 21, 2025, we made a payment to Eisai of $1,616,522 for other invoices and accumulated interest associated

with the letter agreement.

If we fail to comply with our obligations under

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have to be produced by third-party manufacturers.

If we fail to raise additional capital, and as a result are unable to abide by our contractual

obligations with these third-party manufacturers and suppliers, including making timely payment, the necessary third-party support to

commercialize LYMPHIR could be delayed or terminated.

If we fail to raise additional capital, and as a result are unable to abide by our

contractual obligations with these third-party manufacturers and suppliers, including making timely payment, the necessary third-party

support to commercialize LYMPHIR could be delayed or terminated.

We, through Citius Oncology, have secured supply

agreements for LYMPHIR with the two third-party facilities who are in compliance with current good manufacturing practices (“cGMP”)

agreements for LYMPHIR with two third-party facilities who are in compliance with current good manufacturing practices (“cGMP”)

as generally accepted by the FDA.

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regulatory requirements and before any of our collaborators

can begin to commercially manufacture our product candidates, each must obtain regulatory approval of the manufacturing facility and process.

If, for any reason, we become unable to rely on these sources or any future source or sources to manufacture LYMPHIR or any future product

candidates, either for pre-clinical or clinical trials or for commercial quantities, then we would need to identify and contract with

additional or replacement third-party manufacturers to manufacture compounds for preclinical, clinical, and commercial purposes.

not be successful in identifying additional or replacement third-party manufacturers, or in negotiating acceptable terms with any that

we might identify.

If we are unable to secure and maintain third-party manufacturing capacity, the development and sales of LYMPHIR, and

any future product candidates, and our financial performance might be materially and adversely affected.

can begin to commercially manufacture our product candidates, each must obtain regulatory approval of the manufacturing facility and

If, for any reason, we become unable to rely on these sources or any future source or sources to manufacture LYMPHIR or any

future product candidates, either for pre-clinical or clinical trials or for commercial quantities, then we would need to identify and

contract with additional or replacement third-party manufacturers to manufacture compounds for preclinical, clinical, and commercial

We might not be successful in identifying additional or replacement third-party manufacturers, or in negotiating acceptable

terms with any that we might identify.

If we are unable to secure and maintain third-party manufacturing capacity, the commercialization

and sales of LYMPHIR, and any future product candidates, and our financial performance might be materially and adversely affected.

Additionally, if any of our collaborators fails

to comply with the cGMP requirements, we would be subject to possible regulatory action which could limit the jurisdictions in which we

are permitted to sell LYMPHIR, or any future product candidate.

to comply with the cGMP requirements, we would be subject to possible regulatory action which could limit the jurisdictions in which

we are permitted to sell LYMPHIR, or any future product candidate.

As a result, our business, financial condition, and results of operations

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manufacturers exposes us to the following risks:

● We might be unable to identify manufacturers

for commercial supply on acceptable terms or at all because the number of potential manufacturers is limited and the FDA must approve

any replacement contractor.

We might be unable to identify

manufacturers for commercial supply on acceptable terms or at all because the number of potential manufacturers is limited and the

FDA must approve any replacement contractor.

This approval would generally require compliance inspections.

In addition, a new manufacturer would have to

be educated in, or develop substantially equivalent processes for, the production of LYMPHIR and any product candidate approved by the

● Our third-party manufacturers might be unable

to formulate and manufacture LYMPHIR and any product candidate in the volume and of the quality required to meet our clinical and commercial

● Our contract manufacturers might not perform

as agreed or might not remain in the contract manufacturing business for the time required to supply our clinical trials or to successfully

produce, store and distribute LYMPHIR, and any future product candidate approved by the FDA, for commercialization;

● Currently, one of the contract manufacturers

for LYMPHIR is foreign (located in Italy), which increases the risk of shipping delays, adds the risk of import restrictions, and adds

the risk of political and environmental uncertainties that might affect those countries;

● Drug manufacturers are subject to ongoing periodic

unannounced inspection by the FDA and corresponding state agencies to ensure strict compliance with cGMP and other government regulations

and corresponding foreign standards.

We do not have control over third-party manufacturers’ compliance with these regulations and

● If any third-party manufacturer makes improvements

in the manufacturing process for our product candidates, we might not own, or might have to share, the intellectual property rights to

the innovation with our licensors;

● Operations of our third-party manufacturers or

suppliers could be disrupted by conditions unrelated to our business or operations, including a bankruptcy of the manufacturer or supplier

or a natural disaster or a pandemic such as COVID-19;

● We might compete with other companies for access

to these manufacturers’ facilities and might be subject to manufacturing delays if the manufacturers give other clients higher priority.

Each of these risks could delay our clinical trials

or the approval, if any, of our product candidates by the FDA or any foreign regulatory agency or the commercialization of LYMPHIR and

could result in higher costs or deprive us of potential product revenues.

As a result, our business, financial condition, and results

of operations might be materially harmed.

In addition, a new manufacturer

would have to be educated in, or develop substantially equivalent processes for, the production of LYMPHIR and any product candidate

approved by the FDA;

Our third-party manufacturers

might be unable to formulate and manufacture LYMPHIR and any product candidate in the volume and of the quality required to meet

our clinical and commercial needs;

Our contract manufacturers

might not perform as agreed or might not remain in the contract manufacturing business for the time required to supply our clinical

trials or to successfully produce, store and distribute LYMPHIR, and any future product candidate approved by the FDA, for commercialization;

Currently, one of the contract

manufacturers for LYMPHIR is foreign (located in Italy), which increases the risk of shipping delays, adds the risk of import restrictions,

and adds the risk of political and environmental uncertainties that might affect those countries;

Drug manufacturers are

subject to ongoing periodic unannounced inspection by the FDA and corresponding state agencies to ensure strict compliance with cGMP

and other government regulations and corresponding foreign standards.

We do not have control over third-party manufacturers’

compliance with these regulations and standards;

If any third-party manufacturer

makes improvements in the manufacturing process for our product candidates, we might not own, or might have to share, the intellectual

property rights to the innovation with our licensors;

Operations of our third-party

manufacturers or suppliers could be disrupted by conditions unrelated to our business or operations, including a bankruptcy of the

manufacturer or supplier or a natural disaster or a pandemic such as COVID-19;

We might compete with other

companies for access to these manufacturers’ facilities and might be subject to manufacturing delays if the manufacturers give

other clients higher priority.

Each of these risks could delay our clinical

trials or the approval, if any, of our product candidates by the FDA or any foreign regulatory agency or the commercialization of any

approved product candidate and could result in higher costs or deprive us of potential product revenues.

As a result, our business, financial

condition, and results of operations might be materially harmed.

While our business strategy generally is

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commercializing any late-stage product candidate that we pursue.

All of the risks inherent in drug development of initial stage product

candidates also apply to late-stage candidates.

For example, we acquired LYMHIR in September 2021, received approval

in August 2024 and launched it in December 2025, during which time we expended significant resources on the acquisition, development and

launch of LYMPHIR.

All of the risks inherent in drug development of initial stage product candidates also apply to late-stage candidates.

We cannot assure you that our business strategy will be successful.

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results in later studies or trials.

Pre-clinical studies and Phase 1 and Phase 2 clinical

trials are not primarily designed to test the efficacy of a product candidate in the general population, but rather to test initial safety,

to study pharmacokinetics and pharmacodynamics, to study limited efficacy in a small number of study patients in a selected disease population,

and to identify and attempt to understand the product candidate’s side effects at various doses and dosing schedules.

pre-clinical studies or completed clinical trials does not ensure that later studies or trials, including continuing pre-clinical studies

and large-scale clinical trials, will be successful nor does it predict future results.

Favorable results in early studies or trials may

not be repeated in later studies or trials, and product candidates in later stage trials may fail to show acceptable safety and efficacy

despite having progressed through earlier trials.

In addition, the placebo rate in larger studies may be higher than expected.

Pre-clinical studies and Phase 1 and Phase 2

clinical trials are not primarily designed to test the efficacy of a product candidate in the general population, but rather to test

initial safety, to study pharmacokinetics and pharmacodynamics, to study limited efficacy in a small number of study patients in a selected

disease population, and to identify and attempt to understand the product candidate’s side effects at various doses and dosing

Success in pre-clinical studies or completed clinical trials does not ensure that later studies or trials, including continuing

pre-clinical studies and large-scale clinical trials, will be successful nor does it predict future results.

Favorable results in early

studies or trials may not be repeated in later studies or trials, and product candidates in later stage trials may fail to show acceptable

safety and efficacy despite having progressed through earlier trials.

In addition, the placebo rate in larger studies may be higher than

We may be required to demonstrate through large,

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In addition, certain subjects in our clinical trials may respond

positively to placebo treatment - these subjects are commonly known as “placebo responders” - making it more difficult to

demonstrate efficacy of the trial drug compared to placebo.

This effect is likely to be observed in the treatment of hemorrhoids, which

could negatively impact the development program for Halo-Lido.

positively to placebo treatment – these subjects are commonly known as “placebo responders” – making it more

difficult to demonstrate efficacy of the trial drug compared to placebo.

This effect is likely to be observed in the treatment of hemorrhoids,

which could negatively impact the development program for Halo-Lido.

If any of our product candidates fail to demonstrate

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Our reputation in the industry and in the investment community would likely be significantly damaged.

might not be possible for us to raise funds in the public or private markets, and our stock price would likely decrease significantly.

it might not be possible for us to raise funds in the public or private markets, and our stock price would likely decrease significantly.

If we are unable to file for approval of

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our product candidates include efforts to minimize the data we will be required to generate in order to obtain marketing approval for

certain of our product candidates and therefore possibly reduce the time and cost of development of a product candidate and obtain a shortened

review period for the application.

The timeline for filing and review of our planned NDA for each of Mino-Lok and Halo-Lido is based upon

our plan to submit each such NDA under Section 505(b)(2) of the Federal Food, Drug and Cosmetic Act, wherein we will rely in part on data

generated by third parties and that is in the public domain or elsewhere.

Depending on the data that may be required by the FDA for approval,

some of the data may be related to products already approved by the FDA.

If the data relied upon is related to products already approved

by the FDA and covered by third-party patents, we would be required to certify that we do not infringe the listed patents or that such

patents are invalid or unenforceable.

As a result of the certification, the third party would have 45 days from notification of our certification

to initiate an action against us.

In the event that an action is brought in response to such a certification, the approval of our NDA

could be subject to a stay of up to 30 months or more while we defend against such a suit.

Approval of any product candidate under Section

505(b)(2) may therefore be delayed until patent exclusivity expires or until we successfully challenge the applicability of those patents

applicable to our product candidates.

Alternatively, we may elect to generate sufficient additional clinical data so that we no longer

rely on data which triggers a potential stay of the approval of any product candidate.

Even if no exclusivity periods apply to an application

under Section 505(b)(2), the FDA has broad discretion to require us to generate additional data on the safety and efficacy of our product

candidates to supplement third-party data on which we may be permitted to rely.

In either event, we could be required, before obtaining

marketing approval for such product candidate, to conduct substantial new research and development activities beyond those in which we

currently plan to engage in order to obtain approval of that product candidate.

Such additional new research and development activities

would be costly and time consuming.

certain of our product candidates and therefore possibly reduce the time and cost of development of a product candidate and obtain a

shortened review period for the application.

The timeline for filing and review of our planned NDA for each of Mino-Lok and Halo-Lido

is based upon our plan to submit each such NDA under Section 505(b)(2) of the Federal Food, Drug and Cosmetic Act, wherein we will rely

in part on data generated by third parties and that is in the public domain or elsewhere.

Depending on the data that may be required

by the FDA for approval, some of the data may be related to products already approved by the FDA.

If the data relied upon is related

to products already approved by the FDA and covered by third-party patents, we would be required to certify that we do not infringe the

listed patents or that such patents are invalid or unenforceable.

As a result of the certification, the third party would have 45 days

from notification of our certification to initiate an action against us.

In the event that an action is brought in response to such a

certification, the approval of our NDA could be subject to a stay of up to 30 months or more while we defend against such a suit.

of any product candidate under Section 505(b)(2) may therefore be delayed until patent exclusivity expires or until we successfully challenge

the applicability of those patents applicable to our product candidates.

Alternatively, we may elect to generate sufficient additional

clinical data so that we no longer rely on data which triggers a potential stay of the approval of any product candidate.

exclusivity periods apply to an application under Section 505(b)(2), the FDA has broad discretion to require us to generate additional

data on the safety and efficacy of our product candidates to supplement third-party data on which we may be permitted to rely.

event, we could be required, before obtaining marketing approval for such product candidate, to conduct substantial new research and

development activities beyond those in which we currently plan to engage in order to obtain approval of that product candidate.

additional new research and development activities would be costly and time consuming.

We may not be able to obtain shortened review

of our applications where available, and in any event the FDA may not agree that any of our product candidates qualify for marketing approval.

If we are required to generate additional data to support approval, we may be unable to meet our anticipated development and commercialization

timelines, may be unable to generate the additional data at a reasonable cost, or at all, and may be unable to obtain marketing approval

of that product candidate.

In addition, notwithstanding the approval of many products by the FDA pursuant to Section 505(b)(2), over the

last few years, some pharmaceutical companies and others have objected to the FDA’s interpretation of Section 505(b)(2).

FDA changes its interpretation of Section 505(b)(2), or if the FDA’s interpretation is successfully challenged in court, this could

delay or even prevent the FDA from approving any Section 505(b)(2) application that we submit.

of our applications where available, and in any event the FDA may not agree that any of our product candidates qualify for marketing

If we are required to generate additional data to support approval, we may be unable to meet our anticipated development and

commercialization timelines, may be unable to generate the additional data at a reasonable cost, or at all, and may be unable to obtain

marketing approval of that product candidate.

In addition, notwithstanding the approval of many products by the FDA pursuant to Section

505(b)(2), over the last few years, some pharmaceutical companies and others have objected to the FDA’s interpretation of Section

If the FDA changes its interpretation of Section 505(b)(2), or if the FDA’s interpretation is successfully challenged

in court, this could delay or even prevent the FDA from approving any Section 505(b)(2) application that we submit.

Two of our product candidates, Mino-Lok

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community to vary from the existing standard of care to remove and replace an infected catheter.

Currently, hospitals are reimbursed for

the treatment of CRBSIs by the Center for Medicare and Medicare Services (“CMS”) through a Diagnosis Related Group (“DRG”)

classification or code.

Commercial insurance plans reimburse for CRBSIs in a similar manner.

With Mino-Lok being priced as a branded FDA-approved

pharmaceutical product, this could result in the participating hospital retaining a lower share of CMS or commercial reimbursement which

may impact the acceptance and use of Mino-Lok by these institutions.

Currently, hospitals are reimbursed

for the treatment of CRBSIs CMS through a Diagnosis Related Group (“DRG”) classification or code.

Commercial insurance plans

reimburse for CRBSIs in a similar manner.

With Mino-Lok being priced as a branded FDA-approved pharmaceutical product, this could result

in the participating hospital retaining a lower share of CMS or commercial reimbursement which may impact the acceptance and use of Mino-Lok

by these institutions.

Our Halo-Lido product candidate for the treatment

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and discussions with a limited number of physicians, we know that patients sometimes obtain two separate cream products and co-administer

them as prescribed, giving them a combination treatment that could be very similar to what we intend to study and seek approval for.

a branded, FDA-approved product with safety and efficacy data, we intend to price our product substantially higher than the generically

them as prescribed, giving them a combination treatment that could be very similar to what we intend to continue to study and seek approval

As a branded, FDA-approved product with safety and efficacy data, we intend to price our product substantially higher than the generically

available individual creams.

We will then have to convince third-party payers and pharmacy benefit managers of the advantages of our product

and justify our premium pricing.

We may encounter resistance from these entities and will then be dependent on patients’ willingness

to pay the premium and not seek alternatives.

In addition, pharmacists often suggest lower cost prescription treatment alternatives to

both physicians and patients.

We will then have to convince third-party payers and pharmacy benefit managers of the advantages of our

product and justify our premium pricing.

We may encounter resistance from these entities and will then be dependent on patients’

willingness to pay the premium and not seek alternatives.

In addition, pharmacists often suggest lower cost prescription treatment alternatives

to both physicians and patients.

If approved, our Section 505(b)(2) approval and the market exclusivity we may receive will not guarantee

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by payer formularies.

Any fast track designation or grant of priority

review status by the FDA may not actually lead to a faster development or regulatory review or approval process, nor will it assure FDA

approval of our product candidates.

Additionally, our product candidates may treat indications that do not qualify for priority review

Any fast track designation or grant of

priority review status by the FDA may not actually lead to a faster development or regulatory review or approval process, nor will it

assure FDA approval of our product candidates.

Additionally, our product candidates may treat indications that do not qualify for priority

review vouchers.

We have received fast track designation for Mino-Lok

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if we believe a particular product candidate is eligible for these designations, we cannot assure you that the FDA would decide to grant

Even with the fast track designation for Mino-Lok and if we do receive fast track designation or priority review for any other product

candidate, we may not experience a faster development process, review or approval compared to conventional FDA procedures.

withdraw fast track designation from Mino-Lok or any other product candidate to be so designated if it believes that the designation is

no longer supported by data from our clinical development program.

Even with the fast track designation for Mino-Lok and if we do receive fast track designation or priority review for any other

product candidate, we may not experience a faster development process, review or approval compared to conventional FDA procedures.

FDA may withdraw fast track designation from Mino-Lok or any other product candidate to be so designated if it believes that the designation

is no longer supported by data from our clinical development program.

We do not own Citius Oncology or NoveCite,

outright and will share any benefits from the commercialization of LYMPHIR and the development of the NoveCite product candidate

with the other stockholder.

As of September 30, 2024, we owned approximately

92.3% of the outstanding common stock of Citius Oncology and 75% of the outstanding common stock of NoveCite.

As a result, we will only

be entitled to a portion of any benefits that flow from the commercialization by Citius Oncology of LYMPHIR and the development by NoveCite

of its NoveCite product candidate or any other product candidates that either company might develop.

In the event that Citius Oncology

or NoveCite were to issue additional equity securities in the future this would likely reduce our percentage ownership, which would further

reduce the portion of any benefit that might be derived from that company’s successful development and/or commercialization of its

approved drugs and drug candidates, unless we were to increase our investment.

Additionally, as previously announced by the Company,

Citius Pharma intends to distribute Citius Oncology shares to its stockholders at a yet-to-be-determined date in the future, following

the expiration of the six-month lockup period, in accordance with terms of the amended and restated registration rights agreement entered

into in connection with the Merger.

Following the distribution of the Citius Oncology shares, Citius Pharmaceuticals will not be entitled

to any benefits that flow from the commercialization by Citius Oncology of LYMPHIR or would otherwise be derived from Citius Oncology

if it were to remain a majority-owned subsidiary.

Any FDA programs related to the development

and approval of treatments for COVID-19 and its symptoms may not be available to us or actually lead to a faster development or regulatory

review or approval process for NoveCite, our proposed treatment for ARDS, nor will it assure FDA approval of such a treatment.

In late April 2020, we made a pre-IND submission

to the FDA for NoveCite as a treatment for ARDS.

The submission was made under the FDA’s Coronavirus Treatment Acceleration Program

(“CTAP”) and we requested the FDA’s feedback to support the most expeditious pathway for clinical development of the

The CTAP program is relatively new and the FDA has broad discretion in administering the CTAP program and therefore we cannot

assure you what the FDA might decide and whether there would be a faster development process.

Because our NoveCite product candidate is

based on novel technologies, it is difficult to predict the regulatory approval process and the time, the cost and our ability to successfully

initiate, conduct and complete clinical development, and obtain the necessary regulatory and reimbursement approvals, required for commercialization

of our NoveCite product candidate.

NoveCite’s cell programming technology and

platform for generating cell therapy products using allogenic mesenchymal stem cells derived from iPSCs represent novel therapeutic approaches,

and to our knowledge there are currently no iPSC-derived cell products approved anywhere in the world for commercial sale.

is difficult to accurately predict the type and scope of challenges that NoveCite may incur during development of its NoveCite product

candidate, and it faces uncertainties associated with the preclinical and clinical development, manufacture and regulatory requirements

with the other stockholders.

As of December 17, 2025, we owned approximately

77.9% of the outstanding common stock of Citius Oncology (excluding pre-funded warrants to purchase up to 15,229,358 shares of Citius

Oncology common stock in a transaction that closed on December 10, 2025) and 75% of the outstanding common stock of NoveCite.

we will only be entitled to a portion of any benefits that flow from the commercialization by Citius Oncology of LYMPHIR and the development

by NoveCite of its NoveCite product candidate or any other product candidates that either company might develop.

In the event that Citius

Oncology or NoveCite were to issue additional equity securities in the future this would likely reduce our percentage ownership, which

would further reduce the portion of any benefit that might be derived from that company’s successful development and/or commercialization

of its approved drugs and drug candidates, unless we were to increase our investment.

Additionally, as previously announced by the

Company, Citius Pharma intends to distribute Citius Oncology shares to its stockholders at a yet-to-be-determined date in the future,

following the expiration of the six-month lockup period, in accordance with terms of the amended and restated registration rights agreement

entered into in connection with the Merger.

Following the distribution of the Citius Oncology shares, Citius Pharmaceuticals will not

be entitled to any benefits that flow to those shares from the commercialization by Citius Oncology of LYMPHIR or would otherwise be

derived from Citius Oncology, based on its ownership as of December 17, 2025.

Because our NoveCite product candidate

is based on novel technologies, it is difficult to predict the regulatory approval process and the time, the cost and our ability to

successfully initiate, conduct and complete clinical development, and obtain the necessary regulatory and reimbursement approvals, required

for commercialization of our NoveCite product candidate.

NoveCite’s cell programming technology

and platform for generating cell therapy products using allogenic mesenchymal stem cells derived from iPSCs represent novel therapeutic

approaches, and to our knowledge there are currently no iPSC-derived cell products approved anywhere in the world for commercial sale.

As such, it is difficult to accurately predict the type and scope of challenges that NoveCite may incur during development of its NoveCite

product candidate, and it faces uncertainties associated with the preclinical and clinical development, manufacture and regulatory requirements

for the initiation and conduct of clinical trials, regulatory approval, and reimbursement required for successful commercialization of

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The pre-clinical and clinical development, manufacture,

and regulatory requirements for approval of the NoveCite product candidate may be more expensive and take longer than for other more well-known

or extensively studied pharmaceutical or biopharmaceutical product candidates due to a lack of prior experiences on the side of both developers

and regulatory agencies.

Additionally, due to the uncertainties associated with the pre-clinical and clinical development, manufacture,

and regulatory requirements for approval of the NoveCite product candidate, NoveCite may be required to modify or change its pre-clinical

and clinical development plans or its manufacturing activities and plans or be required to meet stricter regulatory requirements for approval.

Any such modifications or changes could delay or prevent NoveCite’s ability to develop, manufacture, obtain regulatory approval

for or commercialize its NoveCite product candidate, which would adversely affect NoveCite’s and our business, financial condition

and results of operations.

and regulatory requirements for approval of the NoveCite product candidate may be more expensive and take longer than for other more

well-known or extensively studied pharmaceutical or biopharmaceutical product candidates due to a lack of prior experiences on the side

of both developers and regulatory agencies.

Additionally, due to the uncertainties associated with the pre-clinical and clinical development,

manufacture, and regulatory requirements for approval of the NoveCite product candidate, NoveCite may be required to modify or change

its pre-clinical and clinical development plans or its manufacturing activities and plans or be required to meet stricter regulatory

requirements for approval.

Any such modifications or changes could delay or prevent NoveCite’s ability to develop, manufacture,

obtain regulatory approval for or commercialize its NoveCite product candidate, which would adversely affect NoveCite’s and our

business, financial condition and results of operations.

Cellular immunotherapies, and stem cell therapies

and iPSC-derived cell therapies in particular, represent relatively new therapeutic areas, and the FDA has cautioned consumers about potential

safety risks associated with cell therapies.

and iPSC-derived cell therapies in particular, represent relatively new therapeutic areas, and the FDA has cautioned consumers about

potential safety risks associated with cell therapies.

To date, there are relatively few approved cell therapies.

As a result, the regulatory approval

process for a product candidate such as NoveCite is uncertain and may be more expensive and take longer than the approval process for

product candidates based on other, better known or more extensively studied technologies and therapeutic approaches.

For example, there

are currently no FDA approved products with a label designation that supports the use of a product to treat and reduce the severity of

ARDS in patients with COVID-19, which makes it difficult to determine the clinical endpoints and data required to support an application

As a result, the regulatory

approval process for a product candidate such as NoveCite is uncertain and may be more expensive and take longer than the approval process

for product candidates based on other, better known or more extensively studied technologies and therapeutic approaches.

there are currently no FDA approved products with a label designation that supports the use of a product to treat and reduce the severity

of ARDS in patients with COVID-19, which makes it difficult to determine the clinical endpoints and data required to support an application

or regulatory approval, and the time and cost required to obtain regulatory approval in the U.S.

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It is possible that over time new or different divisions may be established

or be granted the responsibility for regulating cell and/or gene therapy products, including iPSC-derived cell products, such as the NoveCite

product candidate.

As a result, NoveCite may be required to change its regulatory strategy or to modify its applications for regulatory

approval, which could delay and impair its ability to complete the pre-clinical and clinical development and manufacture of, and obtain

regulatory approval for, its NoveCite product candidate.

Changes in regulatory authorities and advisory groups, or any new requirements

or guidelines they promulgate, may lengthen the regulatory review process, require NoveCite to perform additional studies, increase its

development and manufacturing costs, lead to changes in regulatory pathways, positions and interpretations, delay or prevent approval

and commercialization of the NoveCite product candidate or lead to significant post-approval limitations or restrictions.

advances its NoveCite product candidate, NoveCite will be required to consult with the FDA and other regulatory authorities, and its NoveCite

product candidate will likely be reviewed by an FDA advisory committee.

NoveCite also must comply with applicable requirements, and if

it fails to do so, it may be required to delay or discontinue development of its NoveCite product candidate.

Delays or unexpected costs

in obtaining, or the failure to obtain, the regulatory approval necessary to bring the NoveCite product candidate to market could impair

NoveCite’s and our ability to generate sufficient product revenues to maintain our respective businesses.

or be granted the responsibility for regulating cell and/or gene therapy products, including iPSC-derived cell products, such as the

NoveCite product candidate.

As a result, NoveCite may be required to change its regulatory strategy or to modify its applications for

regulatory approval, which could delay and impair its ability to complete the pre-clinical and clinical development and manufacture of,

and obtain regulatory approval for, its NoveCite product candidate.

Changes in regulatory authorities and advisory groups, or any new

requirements or guidelines they promulgate, may lengthen the regulatory review process, require NoveCite to perform additional studies,

increase its development and manufacturing costs, lead to changes in regulatory pathways, positions and interpretations, delay or prevent

approval and commercialization of the NoveCite product candidate or lead to significant post-approval limitations or restrictions.

NoveCite advances its NoveCite product candidate, NoveCite will be required to consult with the FDA and other regulatory authorities,

and its NoveCite product candidate will likely be reviewed by an FDA advisory committee.

NoveCite also must comply with applicable requirements,

and if it fails to do so, it may be required to delay or discontinue development of its NoveCite product candidate.

Delays or unexpected

costs in obtaining, or the failure to obtain, the regulatory approval necessary to bring the NoveCite product candidate to market could

impair NoveCite’s and our ability to generate sufficient product revenues to maintain our respective businesses.

NoveCite has assumed that the biological

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With respect to iPSCs, NoveCite believes

that scientists are still somewhat uncertain about the clinical utility, life span, and safety of such cells, and whether such cells differ

in any clinically significant ways from adult-donor derived cells.

If NoveCite discovers that iPSCs will not be useful for whatever reason

for its NoveCite product candidate program, this would negatively affect NoveCite’s ability to develop a marketable product and

it and we may never become profitable, which would have an adverse effect on our respective businesses, prospects, financial condition

that scientists are still somewhat uncertain about the clinical utility, life span, and safety of such cells, and whether such cells

differ in any clinically significant ways from adult-donor derived cells.

If NoveCite discovers that iPSCs will not be useful for whatever

reason for its NoveCite product candidate program, this would negatively affect NoveCite’s ability to develop a marketable product

and it and we may never become profitable, which would have an adverse effect on our respective businesses, prospects, financial condition

and results of operations.

Even if we receive regulatory approval to

commercialize a product candidate, that product may not gain market acceptance among physicians, patients, healthcare payers or the medical

community and may not generate significant revenue.

Any FDA programs related to the development

and approval of treatments for COVID-19 and its symptoms may not be available to us or actually lead to a faster development or regulatory

review or approval process for NoveCite, our proposed treatment for ARDS, nor will it assure FDA approval of such a treatment.

In late April 2020, we made a pre-IND submission

to the FDA for NoveCite as a treatment for ARDS.

The submission was made under the FDA’s Coronavirus Treatment Acceleration Program

(“CTAP”) and we requested the FDA’s feedback to support the most expeditious pathway for clinical development of the

The CTAP program is relatively new and the FDA has broad discretion in administering the CTAP program and therefore we cannot

assure you what the FDA might decide and whether there would be a faster development process.

Even if we receive regulatory approval

to commercialize a product candidate, that product may not gain market acceptance among physicians, patients, healthcare payers or the

medical community and may not generate significant revenue.

Even if one of our product candidates obtains

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revenues from any approved product candidate, such as LYMPHIR, or acquired approved product will depend on a number of factors, including:

prevalence and severity of any side effects;

potential or perceived advantages or disadvantages over alternative treatments;

availability of coverage and reimbursement from government and other third-party payers;

the willingness of patients to pay out of pocket in the absence of government or third-party coverage;

the relative convenience and ease of administration and dosing schedule;

strength of sales, marketing and distribution support;

price of any future products, if approved, both in absolute terms and relative to alternative treatments;

the effectiveness of our or any future collaborators’ sales and marketing strategies;

the effect of current and future healthcare laws on any approved products;

patient access programs that require patients to provide certain information prior to receiving new and refill prescriptions;

results of any post-approval studies of the product;

product labeling or product insert requirements of the FDA or other regulatory authorities;

requirements for prescribing physicians to complete certain educational programs for prescribing drugs.

If approved, any product candidate may fail to

achieve market acceptance or generate significant revenue to achieve or sustain profitability, which would harm the Company’s business.

In addition, our efforts to educate the medical community and third-party payers on the benefits of any product candidate may require

significant resources and may never be successful.

sales, marketing and distribution support;

potential or perceived

advantages or disadvantages over alternative treatments;

availability of coverage

and reimbursement from government and other third-party payers;

the willingness of patients

to pay out of pocket in the absence of government or third-party coverage;

the relative convenience

and ease of administration and dosing schedule;

prevalence and severity

of any side effects;

price of any future products,

if approved, both in absolute terms and relative to alternative treatments;

the effectiveness of our

or any future collaborators’ sales and marketing strategies;

the effect of current and

future healthcare laws on any approved products;

patient access programs

that require patients to provide certain information prior to receiving new and refill prescriptions;

results of any post-approval

studies of the product;

product labeling or product

insert requirements of the FDA or other regulatory authorities;

requirements for prescribing

physicians to complete certain educational programs for prescribing drugs.

Even if approved, any product candidate may fail

to achieve market acceptance or generate significant revenue to achieve or sustain profitability, which would harm the Company’s

In addition, our efforts to educate the medical community and third-party payers on the benefits of any product candidate may

require significant resources and may never be successful.

Even if approved for marketing by applicable

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well as much of our marketing, sales, and distribution activities.

In order to generate sales of any product candidate that receives regulatory

approval, we must either acquire or develop an internal marketing and sales force with technical expertise and with supporting distribution

capabilities or make arrangements with third parties to perform these services for us.

Currently, we, through Citius Oncology, are developing

our sales, marketing and distribution capabilities for LYMPHIR and have contracted with Innovation Partners, a large third-party commercial

sales and marketing organization with an existing commercial infrastructure and product launch experience, to assist in our commercial

We do not have any sales, marketing or distribution capabilities with respect to our other product candidates.

The acquisition

or development of a sales and distribution infrastructure requires substantial resources, which may divert the attention of our management

and key personnel and defer our product development efforts.

To the extent that we enter into marketing and sales arrangements with other

companies for any product candidates, our revenues will depend on the efforts of others.

In order to generate sales of any product candidate that receives

regulatory approval, we must either acquire or develop an internal marketing and sales force with technical expertise and with supporting

distribution capabilities or make arrangements with third parties to perform these services for us.

Currently, we, through Citius Oncology,

have developed our sales, marketing and distribution capabilities for LYMPHIR and have contracted with Innovation Partners, a large third-party

commercial sales and marketing organization with an existing commercial infrastructure and product launch experience, to assist in our

commercialization efforts.

In addition, Citius Oncology has entered into distribution agreements with Cardinal Health, Cencora and McKesson

Corporation and has contracted with EVERSANA to support the launch and commercialization of LYMPHIR.

We do not have any sales, marketing

or distribution capabilities with respect to our other product candidates.

The acquisition or development of a sales and distribution

infrastructure requires substantial resources, which may divert the attention of our management and key personnel and defer our product

development efforts.

To the extent that we enter into marketing and sales arrangements with other companies for any product candidates,

our revenues will depend on the efforts of others.

These efforts may not be successful.

to develop sales, marketing, and distribution channels, or fail to enter into arrangements with third parties or the collaboration is

terminated or is otherwise unsuccessful, we will experience delays in product launch and sales and incur increased costs.

If we fail to develop and maintain sales, marketing,

and distribution channels, or fail to enter into arrangements with third parties or the collaboration is terminated or is otherwise unsuccessful,

we will experience delays in product launch and sales and incur increased costs.

Our projections regarding the market opportunity for our LYMPHIR

may not be accurate, and the actual market for LYMPHIR may be smaller than we estimate.

Our projections of incidence rate of MF/SS and the people living with

CTCL and who have the potential to benefit from treatment with LYMPHIR are based on our beliefs and estimates.

These estimates have been

derived from a variety of sources, including SEER data from 2001 to 2007, and may prove to be incorrect.

The number of patients may turn

out to be lower than expected.

Additionally, the potentially addressable patient population for LYMPHIR may be limited or may not be

amenable to treatment with LYMPHIR and may also be limited by the cost of our treatments for patients, any future increase to such costs,

and the reimbursement of those treatment costs by third-party payors.

Even if we obtain significant market share for LYMPHIR, because

the potential target populations are small, we may never achieve profitability.

Physicians and patients might not accept

and use any of our product candidates for which regulatory approval is obtained.

Even with the approval of LYMPHIR, and if the

FDA approves one of our other product candidates, physicians and patients might not accept and use it.

Acceptance and use of our approved

product candidates will depend upon a number of factors, including:

perceptions by members

of the health care community, including physicians, about the safety and effectiveness of any of our product candidates;

perceptions by members

of the health care community, including physicians, about the use of our product candidates versus the then respective standards

of care for the disease or problem that we seek to address with our product candidates;

cost-effectiveness of our

product candidates relative to competing products or therapies;

availability of reimbursement

for our product candidates from government or other healthcare payers;

effective marketing and

distribution efforts by us and/or our licensees and distributors, if any.

If any of our current product candidates are

approved, we expect their sales to generate substantially all of our revenues for the foreseeable future, and as a result, the failure

of any of these product candidates to find market acceptance would harm our business and would require us to seek additional financing.

Prior to the planned distribution of any Citius Oncology shares to our stockholders, we anticipate LYMPHIR will be our only revenue-generating

product for the foreseeable future, unless and until we are able to gain approval for another product candidate, namely Mino-Lok.

Our ability to generate product revenues

will be diminished if any of our product candidates that may be approved sell for inadequate prices or patients are unable to obtain

adequate levels of reimbursement.

Our ability to commercialize our approved product

candidates, alone or with collaborators, will depend in part on the extent to which reimbursement will be available from:

government and health administration

private health maintenance

organizations (HMOs) and health insurers;

other healthcare payers.

Significant uncertainty exists as to the reimbursement

status of newly approved healthcare products.

Healthcare payers, including Medicare, are challenging the prices charged for medical products

and services.

Government and other healthcare payers increasingly attempt to contain healthcare costs by limiting both coverage and the

level of reimbursement for drugs.

Even if our product candidates are approved by the FDA, insurance coverage might not be available,

and reimbursement levels might be inadequate, to cover our products.

If government and other healthcare payers do not provide adequate

coverage and reimbursement levels for our products, once approved, market acceptance of such products could be reduced.

We cannot predict

whether federal or state legislation will be passed that may impact reimbursement policies nor what the impact of any such legislation

would be on the healthcare industry in general or on our business specifically.

We are actively engaged with CMS in order to obtain

the necessary coverage to facilitate reimbursement for LYMPHIR.

However, we can offer no assurance as to any reimbursement coverage.

February, CMS assigned LYMPHIR a unique, permanent Healthcare Common Procedure Coding System J-code, which is expected to provide coding

clarity for physicians and facilities who administer LYMPHIR, thereby facilitating reimbursement.

This achievement is a key step in ensuring

that LYMPHIR is accessible to patients with commercial and government insurance (VA, DoD, Medicare) coverage.

Health administration authorities in countries

other than the U.S.

may not provide reimbursement for our products at rates sufficient for us to achieve profitability, or at all.

the U.S., these countries have considered health care reform proposals and could materially alter their government-sponsored health care

programs by reducing reimbursement rates.

Any reduction in reimbursement rates under Medicare or foreign health care programs could negatively

affect the pricing of our approved product candidates.

If we are not able to charge a sufficient amount for our approved product candidates,

then our margins and our profitability will be adversely affected.

The FDA and other regulatory agencies actively

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for uses that are not approved by the FDA or such other regulatory agencies as reflected in the product’s approved labeling.

the Company receives marketing approval for its product candidates for its proposed indications, physicians may nevertheless use its product

for their patients in a manner that is inconsistent with the approved label, if the physicians believe in their professional medical judgment

it could be used in such manner.

However, if the Company is found to have promoted its product for any off-label uses, the federal government

could levy civil, criminal and/or administrative penalties, and seek fines against us.

The FDA, Department of Justice or other regulatory

authorities could also request that we enter into a consent decree or a corporate integrity agreement, or seek a permanent injunction

against us under which specified promotional conduct is monitored, changed or curtailed.

If we cannot successfully manage the promotion

of LYMPHIR or any product candidates that receive approval, we could become subject to significant liability, which would materially adversely

affect our business, financial condition and results of operations.

the Company receives marketing approval for its product candidates for its proposed indications, physicians may nevertheless use its

product for their patients in a manner that is inconsistent with the approved label, if the physicians believe in their professional

medical judgment it could be used in such manner.

However, if the Company is found to have promoted its product for any off-label uses,

the federal government could levy civil, criminal and/or administrative penalties, and seek fines against us.

The FDA, Department of

Justice or other regulatory authorities could also request that we enter into a consent decree or a corporate integrity agreement, or

seek a permanent injunction against us under which specified promotional conduct is monitored, changed or curtailed.

If we cannot successfully

manage the promotion of LYMPHIR or any product candidates that receive approval, we could become subject to significant liability, which

would materially adversely affect our business, financial condition and results of operations.

The markets in which we operate are highly

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experience as a company, although our executive officers do have pharmaceutical commercialization and launch experience.

We, through Citius

Oncology, have contracted with Innovation Partners, a large third-party commercial sales and marketing organization with an existing commercial

infrastructure and product launch experience to assist in our commercial efforts for LYMPHIR.

However, our prior experience and our third

party arrangements might not translate into the successful development and launch of LYMPHIR or any of our product candidates.

acquisitions, joint ventures and similar events may also significantly increase the competition we face.

In addition, new developments,

including the development of other drug technologies and methods of preventing the incidence of disease, occur in the pharmaceutical and

medical technology industries at a rapid pace.

These developments may render our approved products and our product candidates obsolete

or noncompetitive.

Compared to us, many of our potential competitors have substantially greater as well as access to strategic partners

and capital resources.

Citius Oncology, have contracted with Innovation Partners, a large third-party commercial sales and marketing organization with an existing

commercial infrastructure and product launch experience, and with EVERSANA, a large third-party provider of global commercialization

services, to assist in our commercial efforts for LYMPHIR.

However, our prior experience and our third-party arrangements might not translate

into the successful launch of LYMPHIR or any of our product candidates.

Mergers, acquisitions, joint ventures and similar events may

also significantly increase the competition we face.

In addition, new developments, including the development of other drug technologies

and methods of preventing the incidence of disease, occur in the pharmaceutical and medical technology industries at a rapid pace.

developments may render our approved products and our product candidates obsolete or noncompetitive.

Compared to us, many of our potential

competitors have substantially greater as well as access to strategic partners and capital resources.

As a result of these factors, our competitors

5 unchanged sentences

might be materially harmed.

Physicians and patients might not accept

and use any of our product candidates for which regulatory approval is obtained.

Even if the FDA approves one of our product candidates,

physicians and patients might not accept and use it.

Acceptance and use of our approved product candidates will depend upon a number of

factors, including:

perceptions by members of the health care community, including physicians, about the safety and effectiveness of any of our product candidates;

perceptions by members of the health care community, including physicians, about the use of our product candidates versus the then respective standards of care for the disease or problem that we seek to address with our product candidates;

cost-effectiveness of our product candidates relative to competing products or therapies;

availability of reimbursement for our product candidates from government or other healthcare payers;

effective marketing and distribution efforts by us and/or our licensees and distributors, if any.

If any of our current product candidates are approved,

we expect their sales to generate substantially all of our revenues for the foreseeable future, and as a result, the failure of any of

these product candidates to find market acceptance would harm our business and would require us to seek additional financing.

the planned distribution of our Citius Oncology shares to our stockholders, we anticipate LYMPHIR will be our only revenue-generating

product for the foreseeable future, unless and until we are able to gain approval for another product candidate, namely Mino-Lok.

Our ability to generate product revenues

will be diminished if any of our product candidates that may be approved sell for inadequate prices or patients are unable to obtain adequate

levels of reimbursement.

Our ability to commercialize our approved product

candidates, alone or with collaborators, will depend in part on the extent to which reimbursement will be available from:

government and health administration authorities;

private health maintenance organizations and health insurers;

other healthcare payers.

Significant uncertainty exists as to the reimbursement

status of newly approved healthcare products.

Healthcare payers, including Medicare, are challenging the prices charged for medical products

and services.

Government and other healthcare payers increasingly attempt to contain healthcare costs by limiting both coverage and the

level of reimbursement for drugs.

Even if our product candidates are approved by the FDA, insurance coverage might not be available, and

reimbursement levels might be inadequate, to cover our products.

If government and other healthcare payers do not provide adequate coverage

and reimbursement levels for our products, once approved, market acceptance of such products could be reduced.

We cannot predict whether

federal or state legislation will be passed that may impact reimbursement policies nor what the impact of any such legislation would be

on the healthcare industry in general or on our business specifically.

We are actively engaged with CMS in order to obtain

the necessary coverage to facilitate reimbursement for LYMPHIR.

However, we can offer no assurance as to any reimbursement coverage.

Health administration authorities in countries

other than the U.S.

may not provide reimbursement for our products at rates sufficient for us to achieve profitability, or at all.

the U.S., these countries have considered health care reform proposals and could materially alter their government-sponsored health care

programs by reducing reimbursement rates.

Any reduction in reimbursement rates under Medicare or foreign health care programs could negatively

affect the pricing of our approved product candidates.

If we are not able to charge a sufficient amount for our approved product candidates,

then our margins and our profitability will be adversely affected.

Healthcare reform measures could hinder

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impact the pricing of healthcare products and services in the U.S.

or internationally and the amount of reimbursement available from governmental

agencies or other third-party payors.

Since its enactment, there have been ongoing efforts

to modify the ACA and its implementing regulations.

The Company cannot predict what healthcare reform measures may be enacted by the U.S.

or internationally and the amount of reimbursement available from

governmental agencies or other third-party payors.

Since its enactment, there have been ongoing

efforts to modify the ACA and its implementing regulations.

The Company cannot predict what healthcare reform measures may be enacted

Congress or implemented by any administration or how such efforts would impact its business.

Litigation and legislation over the ACA and

other healthcare reform measures are likely to continue, with unpredictable and uncertain results.

Further, additional legislative changes

to and regulatory changes under or related to the ACA remain possible.

Litigation and legislation over

the ACA and other healthcare reform measures are likely to continue, with unpredictable and uncertain results.

Further, additional legislative

changes to and regulatory changes under or related to the ACA remain possible.

In addition, other legislative changes have been

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The Company expects that additional

federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal health care programs

and commercial payers will pay for healthcare products and services, which could result in reduced demand for our product candidates,

federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal health care

programs and commercial payers will pay for healthcare products and services, which could result in reduced demand for our product candidates,

if approved, or additional pricing pressures.

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have also increasingly

passed legislation and implemented regulations designed to control pharmaceutical and biological product pricing, including price or patient

reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures,

passed legislation and implemented regulations designed to control pharmaceutical and biological product pricing, including price or

patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures,

and, in some cases, designed to encourage importation from other countries and bulk purchasing.

Legally mandated price controls on payment

amounts by third party payors or other restrictions could harm its business, financial condition and results of operations.

amounts by third party payors or other restrictions could harm our business, financial condition and results of operations.

regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products

and which suppliers will be included in their prescription drug and other healthcare programs.

Furthermore, there has been increased interest

by third party payors and governmental authorities in reference pricing systems and publication of discounts and list prices.

other reforms could reduce the ultimate demand for our product candidates, if approved, or put pressure on its product pricing.

Furthermore, there has been increased

interest by third party payors and governmental authorities in reference pricing systems and publication of discounts and list prices.

These or other reforms could reduce the ultimate demand for our product candidates, if approved, or put pressure on its product pricing.

The Company cannot predict the likelihood, nature

or extent of government regulation that may arise from future legislation or administrative action in the U.S.

If the Company or any third

parties it may engage are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies,

or if the Company or such third parties are not able to maintain regulatory compliance, any approved product candidates may lose any regulatory

approval that may have been obtained and we may not achieve or sustain profitability.

If the Company or any

third parties it may engage are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies,

or if the Company or such third parties are not able to maintain regulatory compliance, any approved product candidates may lose any

regulatory approval that may have been obtained and we may not achieve or sustain profitability.

We are and will be dependent on third-party

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fail to renew or terminate any of our collaboration or license agreements or if either party fails to satisfy its obligations under any

of our collaboration or license agreements or complete them in a timely manner, we could have difficulty completing the development of

any of our product candidates and potentially lose significant sources of revenue, which could result in an adverse impact on our operations

and financial condition as well as volatility in any future revenue.

In addition, our agreements with our collaborators may have provisions

that give rise to disputes regarding the rights and obligations of the parties.

These and other possible disagreements could lead to termination

of the agreement or delays in collaborative research, development, supply, or commercialization of our product candidates, or could require

or result in litigation or arbitration.

Any such conflicts with our collaborators could reduce our ability to obtain future collaboration

agreements and could have a negative impact on our relationship with existing collaborators, adversely affecting our business and revenues.

Finally, any of our collaborations may prove to be unsuccessful.

of our collaboration or license agreements or complete them in a timely manner, we could have difficulty continuing marketing and sales

efforts for LYMPHIR or any other approved product candidate, or completing the development of any of our product candidates and potentially

lose significant sources of revenue, which could result in an adverse impact on our operations and financial condition as well as volatility

in any future revenue.

In addition, our agreements with our collaborators may have provisions that give rise to disputes regarding the

rights and obligations of the parties.

These and other possible disagreements could lead to termination of the agreement or delays in

collaborative research, development, supply, or commercialization of our product candidates, or could require or result in litigation

or arbitration.

Any such conflicts with our collaborators could reduce our ability to obtain future collaboration agreements and could

have a negative impact on our relationship with existing collaborators, adversely affecting our business and revenues.

Finally, any of

our collaborations may prove to be unsuccessful.

We rely on the significant experience and

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Our performance is substantially dependent on

the continued services and on the performance of our executive management and other key personnel, who have extensive experience and specialized

expertise in our business.

Our Chief Executive Officer, Leonard Mazur, our Vice Chairman, Myron Holubiak, our Chief Financial Officer

and Chief Business Officer, Jaime Bartushak, and our Chief Medical Officer and Executive Vice President, Myron Czuczman, in particular

the continued services and on the performance of our executive management and other key personnel, who have extensive experience and

specialized expertise in our business.

Our Chief Executive Officer, Leonard Mazur, our Vice Chairman, Myron Holubiak, our Chief Financial

Officer and Chief Business Officer, Jaime Bartushak, and our Chief Medical Officer and Executive Vice President, Myron Czuczman, in particular

have significant experience in the running of pharmaceutical companies and/or drug development itself.

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of the services of any of Mr.

Holubiak and Dr.

Czuczman as well as any other member of our executive management or any key

employees, including those at NoveCite or Citius Oncology, could harm our ability to attract capital and develop and commercialize our

product candidates.

Holubiak, Mr.

Bartushak and Dr.

Czuczman as well as any other member of our executive management

or any key employees, including those at NoveCite or Citius Oncology, could harm our ability to attract capital and develop and commercialize

our product candidates.

Neither we nor NoveCite nor Citius Oncology has key man life insurance policies.

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We utilize the services of a clinical management

team on a part-time basis to assist us in managing our ongoing Phase 2 and Phase 3 trials and intend to do so for future preclinical and

clinical trials.

team on a part-time basis to assist us in managing our ongoing Phase 2 and Phase 3 trials and intend to do so for future preclinical

and clinical trials.

Pursuant to the shared services agreement with Citius Pharma, Citius Oncology utilizes the services of Citius Pharma’s

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Citius Oncology will continue to utilize the services of Citius Pharma employees with expertise in product manufacturing and commercialization

for the planned launch of LYMPHIR.

for the post-launch support of LYMPHIR.

While we believe this will provide us with sufficient staffing for our current and future development

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and biopharmaceutical companies, universities, and other research institutions.

All but one of Citius Oncology’s board members

are also directors of Citius Pharma, and the executive officers of Citius Oncology are also employees of Citius Pharma pursuant to the

shared services agreement.

Citius Oncology expects to rely on these individuals and the other expertise and personnel made available under

the shared services agreement for the foreseeable future.

All but one of Citius Oncology’s board

members are also directors of Citius Pharma, and the executive officers of Citius Oncology are also employees of Citius Pharma pursuant

to the shared services agreement.

Citius Oncology expects to rely on these individuals and the other expertise and personnel made available

under the shared services agreement for the foreseeable future.

Competition for qualified directors, officers

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qualified directors, officers and employees.

In addition, we may be unable to attract and retain those qualified officers, directors and

members of board committees required to provide for effective management.

In addition, we may be unable to attract and retain those qualified officers, directors

and members of Board committees required to provide for effective management.

If we are unable to attract and retain qualified employees,

officers and directors, the management and operation of our business could be adversely affected.

We expect to need to increase the size of

our organization to further develop our product candidates, and we may experience difficulties in managing growth.

We expect to need to increase the size

of our organization to further develop our product candidates, and we may experience difficulties in managing growth.

We will need to manage our anticipated growth

and increased operational activity, including as a result of the planned launch by Citius Oncology of LYMPHIR and our other product candidates.

Our personnel, systems, and facilities currently in place may not be adequate to support this future growth.

Our need to effectively execute

our growth strategy will require that we:

manage our research and development activities and our regulatory trials effectively;

attract and motivate sufficient numbers of talented employees or consultants;

manage our internal development efforts effectively while complying with our contractual obligations to licensors, licensees, contractors, collaborators and other third parties;

develop internal sales and marketing capabilities or establish collaborations with third parties with such capabilities;

commercialize our product candidates;

improve our operational, financial and management

controls, reporting systems and procedures.

This planned future growth could place a

strain on our administrative and operational infrastructure and may require our management to divert a disproportionate amount of its

attention away from our day-to-day activities.

We may not be able to effectively manage the expansion of our operations or recruit and

train additional qualified personnel, which may result in weaknesses in our infrastructure, and give rise to operational mistakes, loss

of business opportunities, loss of employees and consultants and reduced productivity among remaining employees and consultants.

not be able to make improvements to our management information and control systems in an efficient or timely manner and may discover deficiencies

in existing systems and controls.

If our management is unable to effectively manage our expected growth, our expenses may increase more

than expected, our ability to generate or increase our revenues could be reduced and we may not be able to implement our business strategy.

Our future financial performance and our ability to compete effectively will depend, in part, on our ability to effectively manage any

future growth.

and increased operational activity, including as a result of the recent launch by Citius Oncology of LYMPHIR and our continued development

of our other product candidates.

Our personnel, systems, and facilities currently in place may not be adequate to support this future

Our need to effectively execute our growth strategy will require that we:

maintain and strengthen,

as necessary, Citius Oncology’s collaborations with third parties for the sales and marketing of LYMPHIR;

manage our research and

development activities and our regulatory trials effectively;

develop internal sales

and marketing capabilities or establish collaborations with third parties with such capabilities for any other product candidates

that receive approval;

commercialize our product

candidates that receive approval;

manage our internal development

efforts effectively while complying with our contractual obligations to licensors, licensees, contractors, collaborators and other

third parties;

attract and motivate sufficient

numbers of talented employees or consultants;

improve our operational, financial and

management controls, reporting systems and procedures.

This planned future growth could place a strain

on our administrative and operational infrastructure and may require our management to divert a disproportionate amount of its attention

away from our day-to-day activities.

We may not be able to effectively manage the expansion of our operations or recruit and train additional

qualified personnel, which may result in weaknesses in our infrastructure, and give rise to operational mistakes, loss of business opportunities,

loss of employees and consultants and reduced productivity among remaining employees and consultants.

We may not be able to make improvements

to our management information and control systems in an efficient or timely manner and may discover deficiencies in existing systems

and controls.

If our management is unable to effectively manage our expected growth, our expenses may increase more than expected, our

ability to generate or increase our revenues could be reduced and we may not be able to implement our business strategy.

Our future financial

performance and our ability to compete effectively will depend, in part, on our ability to effectively manage any future growth.

We are subject

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against cybersecurity threats.

For more information on how we manage cybersecurity risk, see Item 1C -- Cybersecurity in this Report.

Despite our and our service

providers’ efforts to protect our information technology systems against cybersecurity threats and other disruptions, we are vulnerable

to damage to and disruption of those systems from computer viruses and other malware, natural disasters, terrorism, war, telecommunication

and electrical failures, and cyberattacks or cyber intrusions.

The risk of a security breach or disruption, particularly through cyberattacks

or cyber intrusions by computer hackers, foreign governments, and cyber-terrorists, has increased as the number, intensity, and sophistication

of attempted attacks and intrusions from around the world have increased.

A security breach or other damage to or disruption of our information

technology systems could cause interruptions to our operations, including material disruptions of our product development programs.

example, the loss of data from completed, ongoing, or planned clinical trials could result in delays in our regulatory approval efforts

and cause us to incur significant costs to recover or reproduce the data, resulting in lost revenues and delays in further development

of our product candidates.

For more information on how we manage cybersecurity risk, see Item 1C -- Cybersecurity in this

Despite our and our

service providers’ efforts to protect our information technology systems against cybersecurity threats and other disruptions, we

are vulnerable to damage to and disruption of those systems from computer viruses and other malware, natural disasters, terrorism, war,

telecommunication and electrical failures, and cyberattacks or cyber intrusions.

The risk of a security breach or disruption, particularly

through cyberattacks or cyber intrusions by computer hackers, foreign governments, and cyber-terrorists, has increased as the number,

intensity, and sophistication of attempted attacks and intrusions from around the world have increased.

A security breach or other damage

to or disruption of our information technology systems could cause interruptions to our operations, including material disruptions of

our product development programs.

For example, the loss of data from completed, ongoing, or planned clinical trials could result in delays

in our regulatory approval efforts and cause us to incur significant costs to recover or reproduce the data, resulting in lost revenues

and delays in further development of our product candidates.

A security breach or

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We could be required to spend significant

financial and other resources to respond to and remedy the damage caused by such an incident, including the costs to recover data or to

repair or replace networks and information technology systems, increased cybersecurity protection costs, and increased insurance premiums.

financial and other resources to respond to and remedy the damage caused by such an incident, including the costs to recover data or

to repair or replace networks and information technology systems, increased cybersecurity protection costs, and increased insurance premiums.

If we or our suppliers and/or service providers fail to maintain or protect our information technology systems effectively and in compliance

and foreign laws, or otherwise to prevent, detect, or control security breaches or other system disruptions, we could also be

exposed to government investigations, become subject to lawsuits or other legal proceedings, and experience damage to our reputation,

and foreign laws, or otherwise to prevent, detect, or control security breaches or other system disruptions, we could also

be exposed to government investigations, become subject to lawsuits or other legal proceedings, and experience damage to our reputation,

which could have a material adverse effect on our business, prospects, operating results, and financial condition.

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This is evidenced by our in-licensing of NoveCite in October 2020 and LYMPHIR in September 2021.

might consider opportunities to acquire or invest in other technologies, products and businesses that might enhance our capabilities or

complement our current product candidates.

Potential and completed acquisitions and strategic investments involve numerous risks, including

potential problems or issues associated with the following:

assimilating the acquired technologies, products, or business operations;

maintaining uniform standards, procedures, controls, and policies;

unanticipated costs associated with the acquisition or investment;

diversion of our management’s attention from our preexisting business;

maintaining or obtaining the necessary regulatory approvals or complying with regulatory standards;

adverse effects on existing business operations.

might consider opportunities to acquire or invest in other technologies, products and businesses that might enhance our capabilities

or complement our current product candidates.

Potential and completed acquisitions and strategic investments involve numerous risks,

including potential problems or issues associated with the following:

assimilating the acquired

technologies, products, or business operations;

maintaining uniform standards,

procedures, controls, and policies;

unanticipated costs associated

with the acquisition or investment;

diversion of our management’s

attention from our preexisting business;

maintaining or obtaining

the necessary regulatory approvals or complying with regulatory standards;

adverse effects on existing

business operations.

We have no current commitments with respect to

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These efforts could be expensive and time consuming and might disrupt our ongoing operations.

are unable to efficiently integrate any acquired business, technology or product into our business operations, our business and financial

we are unable to efficiently integrate any acquired business, technology or product into our business operations, our business and financial

condition might be adversely affected.

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relationship with Citius Oncology and NoveCite.

As of September 30, 2024, we beneficially owned

approximately 92.3% of the voting power of Citius Oncology (Nasdaq:

CTOR) and 75% of the voting power of NoveCite’s outstanding common

stock and Novellus owns the other 25% of NoveCite.

As a result of our partial ownership, our relationship with each of Citius Oncology

and NoveCite could give rise to certain conflicts of interest that could have an impact on our, Citius Oncology’s and NoveCite’s

respective research and development programs, business opportunities, and operations generally.

Even though we utilize different technologies than Citius Oncology and NoveCite, we could find ourselves in competition with it for research scientists, financing and other resources, licensing, manufacturing, and distribution arrangements.

Citius Oncology and NoveCite will engage for its own business in research and product development programs, investments, and business ventures, and we will not be entitled to participate or to receive an interest in those programs, investments, or business ventures other than to the extent as a stockholder in the subsidiary.

Citius Oncology and NoveCite will not be obligated to present any particular research and development, investment, or business opportunity to us, even if the opportunity would be within the scope of our research and development plans or programs, business objectives, or investment policies.

These opportunities may include, for example, opportunities to acquire businesses or assets, including but not limited to patents and other intellectual property that could be used by us or by Citius Oncology or NoveCite.

Each conflict of interest will be resolved by our respective boards of directors in keeping with their fiduciary duties and such policies as they may implement from time to time.

There is overlap among our board of directors, senior management and research staffs and that of Citius Oncology and NoveCite.

All of our directors also serve as directors of Citius Oncology.

As of December 17, 2025, we beneficially owned

approximately 77.9% (excluding pre-funded warrants to purchase up to 15,229,358 shares of Citius Oncology common stock in a transaction

that closed on December 10, 2025) of the voting power of Citius Oncology (Nasdaq:

CTOR) and 75% of the voting power of NoveCite’s

outstanding common stock and Novellus owns the other 25% of NoveCite.

As a result of our partial ownership, our relationship with each

of Citius Oncology and NoveCite could give rise to certain conflicts of interest that could have an impact on our, Citius Oncology’s

and NoveCite’s respective research and development programs, business opportunities, and operations generally.

Even though we utilize

different technologies than Citius Oncology or NoveCite, we could find ourselves in competition with either for research scientists,

financing and other resources, licensing, manufacturing, and distribution arrangements.

Each of Citius Oncology

and NoveCite will engage for its own business in research and product development programs, investments, and business ventures, and

we will not be entitled to participate or to receive an interest in those programs, investments, or business ventures other than

to the extent as a stockholder in the subsidiary.

Citius Oncology and NoveCite will not be obligated to present any particular research

and development, investment, or business opportunity to us, even if the opportunity would be within the scope of our research and

development plans or programs, business objectives, or investment policies.

These opportunities may include, for example, opportunities

to acquire businesses or assets, including but not limited to patents and other intellectual property that could be used by us or

by Citius Oncology or NoveCite.

Each conflict of interest

will be resolved by our respective boards of directors in keeping with their fiduciary duties and such policies as they may implement

from time to time.

There is overlap among

our board of directors, senior management and research staffs and that of Citius Oncology and NoveCite.

All of our directors also

serve as directors of Citius Oncology.

Two of our directors, Leonard Mazur and Myron Holubiak, also serve as directors of NoveCite.

In addition, Myron Holubiak serves as Chief Executive Officer and Jaime Bartushak serves as Chief Financial Officer of each of Citius Pharma, Citius Oncology and NoveCite.

These overlapping positions could interfere with the duties owed by such individuals to Citius Pharma.

In addition, Myron Holubiak serves as Chief Executive Officer and Jaime Bartushak serves as Chief Financial Officer of each of Citius

Pharma, Citius Oncology and NoveCite.

These overlapping positions could interfere with the duties owed by such individuals to Citius

Risks Related to Our Regulatory and Legal Environment

We might not obtain the necessary U.S.

foreign regulatory approvals to commercialize any current product candidates.

or foreign regulatory approvals to commercialize any current product candidates.

We cannot assure you that we will receive the

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in products that the FDA considers safe for humans and effective for their indicated uses.

The FDA has substantial discretion in the product

approval process and might require us to conduct additional pre-clinical and clinical testing, perform post-marketing studies or otherwise

limit or impose conditions on any additional approvals we obtain.

The approval process might also be delayed by changes in government

regulation, future legislation or administrative action or changes in FDA policy that occur prior to or during our product candidate’s

regulatory review.

The FDA has substantial discretion in the

product approval process and might require us to conduct additional pre-clinical and clinical testing, perform post-marketing studies

or otherwise limit or impose conditions on any additional approvals we obtain.

The approval process might also be delayed by changes

in government regulation, future legislation or administrative action or changes in FDA policy that occur prior to or during our product

candidate’s regulatory review.

Delays in obtaining regulatory approvals might:

delay commercialization of, and our ability to derive product revenues from, our product candidates;

impose costly procedures on us;

diminish any competitive advantages that we might otherwise enjoy.

Even if we comply with all FDA requests, the FDA

might ultimately reject one or more of our NDAs or BLAs.

Even if we are able to obtain regulatory approval for a particular product candidate,

the approval might limit the indicated medical uses for the product, limit our ability to promote, sell, and distribute the product, require

that we conduct costly post-marketing surveillance, and/or require that we conduct ongoing post-marketing studies.

We cannot be sure that

we will ever obtain regulatory clearance for any of our product candidates.

Failure to obtain FDA approval of one or more of our product

candidates could severely undermine our business by leaving us without saleable products, and therefore without any potential sources

of revenues, until another product candidate could be developed or obtained and successfully developed, approved and commercialized.

jurisdictions impose similar regulatory approval processes and we will face the same risks if we seek foreign approval for any of our

product candidates.

There is no guarantee that we will ever be able to successfully develop or acquire any product candidate.

delay commercialization

of, and our ability to derive product revenues from, our product candidates;

impose costly procedures

diminish any competitive

advantages that we might otherwise enjoy.

Even if we comply with all FDA requests, the

FDA might ultimately reject one or more of our NDAs or BLAs.

Even if we are able to obtain regulatory approval for a particular product

candidate, the approval might limit the indicated medical uses for the product, limit our ability to promote, sell, and distribute the

product, require that we conduct costly post-marketing surveillance, and/or require that we conduct ongoing post-marketing studies.

cannot be sure that we will ever obtain regulatory clearance for any of our product candidates.

Failure to obtain FDA approval of one

or more of our product candidates could severely undermine our business by leaving us with only one saleable product, LYMPHIR, and therefore

with a limited source of revenue, until another product candidate could be developed or obtained and successfully developed, approved

and commercialized.

Foreign jurisdictions impose similar regulatory approval processes and we will face the same risks if we seek foreign

approval for any of our product candidates.

There is no guarantee that we will ever be able to successfully develop or acquire any product

Following any regulatory approval of any

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limit our ability to commercialize our other product candidates.

When a product candidates is approved by the FDA

When a product candidate is approved by the FDA

or by a foreign regulatory authority, we will be required to comply with extensive regulations for product manufacturing, labeling, packaging,

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Regulatory approvals may also be subject to

significant limitations on the indicated uses or marketing of the products or to whom and how we may distribute an approved product.

significant limitations on the indicated uses or marketing of the product or to whom and how we may distribute an approved product.

regulatory approval is obtained, the FDA may still impose significant restrictions on a product’s indicated uses or marketing

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access to the product, which would reduce our revenues and/or increase our costs.

Potentially costly post-marketing clinical studies may

be required as a condition of approval to further substantiate safety or efficacy, or to investigate specific issues of interest to the

regulatory authority.

Potentially costly post-marketing clinical studies

may be required as a condition of approval to further substantiate safety or efficacy, or to investigate specific issues of interest

to the regulatory authority.

Similar risks apply in foreign jurisdictions.

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Further, regulatory agencies must approve these

manufacturing facilities before they can be used to manufacture our future approved products, if any, and these facilities are subject

to ongoing regulatory inspections.

In addition, regulatory agencies subject a pharmaceutical product, its manufacturer and the manufacturer’s

manufacturing facilities before they can be used to manufacture an approved product and these facilities are subject to ongoing regulatory

In addition, regulatory agencies subject an approved pharmaceutical product, its manufacturer and the manufacturer’s

facilities to continual review and inspections.

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suppliers fail to comply with applicable regulatory requirements, it could result in regulatory action and additional costs to us.

to comply with applicable FDA and other regulatory requirements may, either before or after product approval, if any, subject our company

to administrative or judicially imposed sanctions.

to comply with applicable FDA and other regulatory requirements may subject us to administrative or judicially imposed sanctions, either

before or after product approval, if any.

In addition, the law or regulatory policies governing

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and a medical expense per person limit of $25,000.

There can be no assurance that our existing insurance coverage will extend to any other

product candidates in the future.

There can be no assurance that our existing insurance coverage will extend to any

other product candidates in the future.

Any product liability insurance coverage may not be sufficient to satisfy all liabilities resulting

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Even if a claim is not successful, defending such a claim would be time consuming and expensive,

may damage that product’s and our reputations in the marketplace, and would likely divert management’s attention, any of which

could have a material adverse effect on our Company.

may damage that product’s and our reputations in the marketplace, and would likely divert management’s attention, any of

which could have a material adverse effect on our Company.

Risks Related to Our Intellectual Property

Our business depends on protecting our intellectual

Our business depends on protecting our

intellectual property.

Without the intellectual property rights we have

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include the following:

Our patent rights might be challenged, invalidated, or circumvented, or otherwise might not provide any competitive advantage;

Our competitors, many of which have substantially greater resources than we do and many of which might make significant investments in competing technologies, might seek, or might already have obtained, patents that will limit, interfere with, or eliminate our ability to make, use, and sell our product candidates either in the U.S.

our patent rights might

be challenged, invalidated, or circumvented, or otherwise might not provide any competitive advantage;

our competitors, many of

which have substantially greater resources than we do and many of which might make significant investments in competing technologies,

might seek, or might already have obtained, patents that will limit, interfere with, or eliminate our ability to make, use, and sell

our product candidates either in the U.S.

or in international markets;

Countries other than the U.S.

countries other than the

might have less restrictive patent laws than those upheld by U.S.

courts, allowing foreign competitors the ability to exploit these laws to create, develop, and market competing products;

As a matter of public policy regarding worldwide health concerns, there might be significant pressure on the U.S.

government and other international governmental bodies to limit the scope of patent protection both inside and outside the U.S.

courts, allowing foreign competitors the ability to exploit

these laws to create, develop, and market competing products;

as a matter of public policy

regarding worldwide health concerns, there might be significant pressure on the U.S.

government and other international governmental

bodies to limit the scope of patent protection both inside and outside the U.S.

for product candidates that prove successful.

In addition, the USPTO and patent offices in other

jurisdictions have often required that patent applications concerning pharmaceutical and/or biotechnology-related inventions be limited

or narrowed substantially to cover only the specific innovations exemplified in the patent application, thereby limiting the scope of

protection against competitive challenges.

Thus, even if we or our licensors are able to obtain patents, the patents might be substantially

narrower than anticipated.

Because the time period from filing a patent application

to the issuance, if ever, of the patent is often more than three years and because any regulatory approval and marketing for a pharmaceutical

product often occurs several years after the related patent application is filed, the resulting market exclusivity afforded by any patent

on our drug candidates and technologies will likely be substantially less than 20 years.

In addition, the USPTO and patent offices in

other jurisdictions have often required that patent applications concerning pharmaceutical and/or biotechnology-related inventions be

limited or narrowed substantially to cover only the specific innovations exemplified in the patent application, thereby limiting the

scope of protection against competitive challenges.

Thus, even if we or our licensors are able to obtain patents, the patents might be

substantially narrower than anticipated.

Because the time period from filing a patent

application to the issuance, if ever, of the patent is often more than three years and because any regulatory approval and marketing

for a pharmaceutical product often occurs several years after the related patent application is filed, the resulting market exclusivity

afforded by any patent on our drug candidates and technologies will likely be substantially less than 20 years.

For example, the U.S.

patent on the original

Mino-Lok composition expired in June 2024, and the U.S.

patent on the stabilized Mino-Lok composition expires in November 2036.

we anticipate significant additional time before FDA approval could be obtained, the maximum market exclusivity afforded by the statutory

term of the currently issued patents would be less than 16 years.

In the U.S., the European Union and some other jurisdictions, patent

term extensions are available for certain delays in either patent office proceedings or marketing and regulatory approval processes.

due to the specific requirements for obtaining these extensions, there is no assurance that our patents will be granted extensions even

if we encounter significant delays in patent office proceedings or marketing and regulatory approval.

patent on the original Mino-Lok composition expired in June 2024, and the U.S.

patent on the stabilized Mino-Lok composition expires

in November 2036.

Since we anticipate significant additional time before FDA approval could be obtained, the maximum market exclusivity

afforded by the statutory term of the currently issued patents would be less than 10 years.

In the U.S., the European Union and some

other jurisdictions, patent term extensions are available for certain delays in either patent office proceedings or marketing and regulatory

approval processes.

However, due to the specific requirements for obtaining these extensions, there is no assurance that our patents

will be granted extensions even if we encounter significant delays in patent office proceedings or marketing and regulatory approval.

Additionally, patent law is subject to change

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in part, through confidentiality and non-disclosure agreements with our employees, collaborators, suppliers, and other parties.

can be no assurance that these agreements will not be breached, that we would have adequate remedies for any such breach or that our trade

secrets will not otherwise become known to or independently developed by our competitors.

We might be involved from time to time in litigation

to determine the enforceability, scope and validity of our proprietary rights.

Any such litigation could result in substantial cost and

divert management’s attention from our operations.

can be no assurance that these agreements will not be breached, that we would have adequate remedies for any such breach or that our

trade secrets will not otherwise become known to or independently developed by our competitors.

We might be involved from time to time

in litigation to determine the enforceability, scope and validity of our proprietary rights.

Any such litigation could result in substantial

cost and divert management’s attention from our operations.

If we infringe the rights of third parties

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and other technologies infringe the proprietary rights of other parties, we could incur substantial costs and we might have to:

obtain licenses, which might not be available on commercially reasonable terms, if at all;

abandon an infringing product candidate;

redesign our product candidates or processes to avoid infringement;

stop using the subject matter claimed in the patents held by others;

defend litigation or administrative proceedings which might be costly whether we win or lose, and which could result in a substantial diversion of our financial and management resources.

Any of these events could substantially harm our

earnings, financial condition, and operations.

obtain licenses, which

might not be available on commercially reasonable terms, if at all;

abandon an infringing product

redesign our product candidates

or processes to avoid infringement;

stop using the subject

matter claimed in the patents held by others;

defend litigation or administrative

proceedings which might be costly whether we win or lose, and which could result in a substantial diversion of our financial and

management resources.

Any of these events could substantially harm

our earnings, financial condition, and operations.

government could have “march-in

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however, the exercise of such march-in rights has been historically

rare when the patent holder (or its licensee) is practicing the patent invention although there can be no assurance that such rights would

not be exercised.

This same risk would apply to any other license into which we enter if the licensor receives government funding for

the product candidate that is the subject of the license.

rare when the patent holder (or its licensee) is practicing the patent invention although there can be no assurance that such rights

would not be exercised.

This same risk would apply to any other license into which we enter if the licensor receives government funding

for the product candidate that is the subject of the license.

If our trademarks and trade names are not

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infringed, diluted, tarnished, circumvented or declared generic or determined to be infringing on other marks.

The Company may not be

able to protect our rights to these trademarks and trade names, which we need to build name recognition among potential partners or customers

We may not be able to

protect our rights to these trademarks and trade names, which we need to build name recognition among potential partners or customers

in the markets of interest.

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operations may be adversely affected.

The Company’s efforts to enforce or protect our proprietary rights related to trademarks,

trade secrets, domain names, copyrights or other intellectual property may be ineffective and could result in substantial costs and diversion

of resources.

Our efforts to enforce or protect our proprietary rights related to trademarks, trade secrets,

domain names, copyrights or other intellectual property may be ineffective and could result in substantial costs and diversion of resources.

Risks Related to the Recently Completed Merger

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of the benefits that we expect to achieve from the Merger.

The Company believes that separating LYMPHIR into

a standalone entity will create two focused standalone public companies that are better positioned to pursue their strategic priorities,

invest in growth opportunities, and attract new investors.

The Company also believes that the Merger will result in significant benefits

to our Company and our stockholders as a result of unlocking the value we believe that Citius Oncology will have as a standalone publicly

traded company.

However, by separating from Citius Pharma, Citius Oncology might be more susceptible to market fluctuations and we may

be unable to achieve some or all of the benefits that we expect Citius Oncology to achieve as an independent company in the time we expect,

Further, if the Merger’s benefits do not meet the expectations of financial analysts, or due to the other factors discussed

in this “ Risk Factors ” section and elsewhere in this report, the market price of both Citius Pharma common stock and

Citius Oncology common stock might decline or increase in volatility.

Additionally, as previously announced by the Company,

Citius Pharma intends to distribute Citius Oncology shares to its stockholders at a yet-to-be-determined date in the future, following

the expiration of the six-month lockup period, in accordance with terms of the amended and restated registration rights agreement entered

into in connection with the Merger.

Following the distribution of the Citius Oncology shares, Citius Pharmaceuticals will not be entitled

to any benefits that flow from the commercialization by Citius Oncology of LYMPHIR or would otherwise be derived from Citius Oncology

if it were to remain a majority-owned subsidiary.

The Company believes that separating LYMPHIR

into a standalone entity has created two focused standalone public companies that are better positioned to pursue their respective strategic

priorities, invest in growth opportunities, and attract new investors.

The Company also believes that the Merger will result in significant

benefits to our Company and our stockholders as a result of unlocking the value we believe that Citius Oncology will have as a standalone

publicly traded company.

However, by separating from Citius Pharma, Citius Oncology might be more susceptible to market fluctuations

and we may be unable to achieve some or all of the benefits that we expect Citius Oncology to achieve as an independent company in the

time we expect, if at all.

Further, if the Merger’s benefits do not meet the expectations of financial analysts, or due to the

other factors discussed in this “ Risk Factors ” section and elsewhere in this report, the market price of both Citius

Pharma common stock and Citius Oncology common stock might decline or increase in volatility.

Additionally, as previously announced by the

Company, Citius Pharma intends to distribute an undetermined amount of Citius Oncology shares to its stockholders at a yet-to-be-determined

date in the future.

Following the distribution of any Citius Oncology shares, Citius Pharmaceuticals will be entitled to less of any

benefits that flow from the commercialization by Citius Oncology of LYMPHIR or would otherwise be derived from Citius Oncology if it

were to remain a majority-owned subsidiary.

A planned distribution by Citius Pharma

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to our stockholders would not qualify for non-recognition of gain and loss, and therefore, our stockholders could be subject to tax.

holder who received Citius Oncology stock in a distribution would generally be treated as receiving a distribution in an amount equal

to the fair market value of Citius Oncology common stock received, which would generally result in (i) a taxable dividend to the stockholder

to the extent that stockholder’s pro rata share of Citius Pharma’s current or accumulated earnings and profits;

(ii) a reduction

in the stockholder’s basis (but not below zero) in Citius Pharma’s common stock to the extent the amount received exceeds

the stockholder’s shares of Citius Pharma’s earnings and profits;

and (iii) a taxable gain from the exchange of Citius Pharma’s

stock to the extent the amount received exceeds the sum of the stockholder’s share of Citius Pharma’s earnings and profits

and the stockholder’s basis in its Citius Pharma stock.

holder who received Citius Oncology stock in a distribution would generally be treated as receiving a distribution in an amount

equal to the fair market value of Citius Oncology common stock received, which would generally result in (i) a taxable dividend to the

stockholder to the extent that stockholder’s pro rata share of Citius Pharma’s current or accumulated earnings and profits;

(ii) a reduction in the stockholder’s basis (but not below zero) in Citius Pharma’s common stock to the extent the amount

received exceeds the stockholder’s shares of Citius Pharma’s earnings and profits;

and (iii) a taxable gain from the exchange

of Citius Pharma’s stock to the extent the amount received exceeds the sum of the stockholder’s share of Citius Pharma’s

earnings and profits and the stockholder’s basis in its Citius Pharma stock.

Citius Pharma will also recognize a taxable gain

in an amount up to the fair market value of any distributed Citius Oncology stock in excess of the taxable basis in such distributed shares.

Risks Related to Our Securities

in an amount up to the fair market value of any distributed Citius Oncology shares in excess of the taxable basis in such distributed

Risks Related to Our Common Stock

Our failure to maintain compliance with

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In order to maintain this listing, we must satisfy minimum financial and other requirements.

On September 12, 2023, Citius Pharma received

a notification letter from Nasdaq indicating that we were not in compliance with Nasdaq Listing Rule 5550(a)(2) because the minimum bid

price of our common stock on the Nasdaq Capital Market closed below $1.00 per share for 30 consecutive business days (“the Bid Price

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company has a compliance period of 180 calendar days, or until

March 11, 2024, to regain compliance with the Bid Price Rule.

On March 12, 2024, the Company received

formal notice that Nasdaq granted the Company’s request for an extension through September 9, 2024 to evidence compliance with the

Bid Price Rule.

As the Company did not

regain compliance with the Bid Price Rule by September 9, 2024, the Company received a delisting determination letter on September 10, 2024.

Accordingly, the Company timely requested a hearing before a Nasdaq Hearing Panel (“Panel”).

The hearing request automatically

stayed any suspension or delisting action pending the hearing and the expiration of any additional extension period granted by the Panel

following the hearing.

In that regard, pursuant to the Nasdaq Listing Rules, the Panel has the discretion to grant the Company an additional

extension period not to exceed 180 days from the date of the delisting determination letter.

On November 6, 2024,

the Company received notification that the Panel, which determined that the Company must be in compliance with the Bid Price Rule by December

On December 18, 2024,

the Company received notification from Nasdaq that it had regained compliance with the Bid Price Rule.

While Citius Pharma intends to engage in efforts

to regain compliance, and thus maintain our listing, there can be no assurance that we will be successful or, if successful, continue

to meet all applicable Nasdaq Capital Market requirements in the future.

On September 12, 2023, Citius Pharma

received a notification letter from Nasdaq indicating that we were not in compliance with Nasdaq Listing Rule 5550(a)(2) because the

minimum bid price of our common stock on the Nasdaq Capital Market closed below $1.00 per share for 30 consecutive business days

(the “Bid Price Rule”).

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), a company has a compliance period of 180

calendar days to regain compliance with the Bid Price Rule and may be eligible for a second 180 calendar day extension period for

As the Company did not regain compliance with the Bid Price Rule within the compliance periods, the Company received a

delisting determination letter on September 10, 2024.

Accordingly, the Company timely requested a hearing before a Nasdaq

Hearing Panel (“Panel”).

The hearing request automatically stayed any suspension or delisting action pending the hearing

and the expiration of any additional extension period granted by the Panel following the hearing.

On November 6, 2024, the Company

received notification that the Panel, which determined that the Company must be in compliance with the Bid Price Rule by December 3,

On December 18, 2024, following the execution of the Company’s reverse stock split, the Company received notification

from Nasdaq that it had regained compliance with the Bid Price Rule.

On May 29, 2025, the

Company received a second determination letter from Nasdaq notifying the Company that, based upon the closing bid price of the Company’s

common stock for the prior 33 consecutive business days, the Company was not in compliance with the Bid Price Rule and, pursuant to Nasdaq

Listing Rule 5810(c)(3)(A)(iv), the Company was not eligible for any compliance period due to the fact that the Company had effected

a reverse stock split during the prior one-year period.

The Company timely requested an appeal of Nasdaq’s determination, which

stayed the suspension and delisting of the Company’s common stock pending a the Panel’s decision.

hearing, the Company received written notice of compliance from Nasdaq that for 10 consecutive trading days, from June 20, 2025 to July

3, 2025, the closing bid price of the Company’s common stock had been at $1.00 per share or greater, and accordingly, the Company

regained compliance with the Bid Price Rule.

Nasdaq informed the Company in the compliance notice that it considered this matter closed.

While Citius Pharma intends to maintain compliance

in the future, and thus maintain our listing, there can be no assurance that we will be successful and continue to meet all applicable

Nasdaq Capital Market requirements in the future.

If Citius Pharma’s common stock were to

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and there is no longer an active trading market for our shares, it may, among other things:

cause stockholders difficulty in selling Citius Pharma’s shares without depressing the market price for the shares or selling the shares at all;

substantially impair the ability to raise additional funds;

result in a loss of institutional investor interest and fewer financing opportunities;

result in potential breaches of representations or covenants of agreements pursuant to which Citius Pharma made representations or covenants relating to compliance with applicable listing requirements.

Claims related to any such breaches, with or without merit, could result in costly litigation, significant liabilities and diversion of management’s time and attention and could have a material adverse effect on the financial condition, business and results of operations.

stockholders difficulty in selling Citius Pharma’s shares without depressing the market price for the shares or selling the

shares at all;

substantially

impair the ability to raise additional funds;

in a loss of institutional investor interest and fewer financing opportunities;

in potential breaches of representations or covenants of agreements pursuant to which Citius Pharma made representations or covenants

relating to compliance with applicable listing requirements.

Claims related to any such breaches, with or without merit, could result

in costly litigation, significant liabilities and diversion of management’s time and attention and could have a material adverse

effect on the financial condition, business and results of operations.

A delisting would also reduce the value of Citius

Pharma’s equity compensation plans, which could negatively impact the ability to retain employees.

The market price of the Company’s common

stock is highly volatile, and you may lose some or all of your investment.

The market price of the Company’s common

stock has fluctuated significantly due to a number of factors, some of which are beyond our control, including those factors discussed

in this “ Risk Factors and Risk Factor Summary ” section and many others, such as:

● the Company’s cash resources available to continue commercialization

and development of LYMPHIR;

● the Company’s ability to meet its contractual obligations;

● the ability of the Company to regain and maintain compliance with the Nasdaq

continued listing requirements, including by implementing a reverse stock split;

● Company’s ability to commercialize its product candidates, if approved

and Citius Oncology’s ability to commercialize LYMPHIR;

● the level of success and the cost of Company’s marketing efforts for

its product candidates, if approved;

● unanticipated serious safety concerns related to the use of its product candidates;

● announcements regarding results of any pre-clinical or clinical trials relating

to Company’s product candidates;

The market price of our common stock is

highly volatile, and you may lose some or all of your investment.

The market price of our common stock has fluctuated

significantly due to a number of factors, some of which are beyond our control, including those factors discussed in this “ Risk

Factors” and “Risk Factor Summary ” section of this report and many others, such as:

the Company’s cash

resources available to successfully commercialize LYMPHIR, including covering the costs of licensing payments, product manufacturing

and other third-party goods and services;

the Company’s ability

to meet its contractual obligations;

the ability of the Company

to maintain compliance with the Nasdaq continued listing requirements;

the Company’s ability

to commercialize its product candidates, if approved and Citius Oncology’s ability to successfully commercialize LYMPHIR;

the level of success and

the cost of Company’s marketing efforts for LYMPHIR and its other product candidates, if approved;

the Company’s dependence

on third parties

unanticipated serious safety

concerns related to the use of its product candidates;

announcements regarding

results of any pre-clinical or clinical trials relating to Company’s product candidates;

adverse regulatory decisions;

● changes in laws or regulations applicable to any product candidates, including

but not limited to clinical trial requirements for approvals;

● the Company’s dependence on third parties;

● future issuances of debt or equity securities;

● actual or anticipated fluctuations in the Company’s financial condition

and operating results, including fluctuations in our quarterly and annual results;

● the Company’s inability to establish additional partnerships, the termination

of license agreements by our existing partners or announcements by our partners regarding therapeutic candidates generated using our platform;

● the introduction of new technologies or enhancements to existing technology

by the Company or others in the industry;

● the recruitment or departures of key scientific or management personnel;

● announcements of significant acquisitions, strategic partnerships, joint

ventures or capital commitments by the Company or our competitors;

● the Company’s failure to meet the estimates and projections of the

investment community or that we may otherwise provide to the public;

● publication of research reports about the Company or our industry, or antibody

discovery in particular, or positive or negative recommendations or withdrawal of research coverage by securities analysts;

● changes in the market valuations of similar companies;

● overall performance of the equity markets;

● announcements or actions taken by Citius Oncology as a majority-owned subsidiary

of the Company;

● the planned distribution of shares common stock of Citius Oncology by Citius

● sales of shares of common stock by Citius Pharma;

● trading volume of the Company’s Common Stock;

● legal disputes or other developments relating to proprietary rights, including

patents, litigation matters and Company’s ability to obtain and maintain patent protection of its product candidates, government

investigations and the results of any proceedings or lawsuits, including, but not limited to, patent or stockholder litigation;

● significant lawsuits, including patent or stockholder litigation;

● the impact of any natural disasters or public health emergencies, such as

the COVID-19 pandemic;

● general economic, industry and market conditions other events or factors,

many of which are beyond the Company’s control;

● changes in accounting standards, policies, guidelines, interpretations or

In addition, in the past, stockholders have initiated

Company action lawsuits against biotechnology and biopharmaceutical companies following periods of volatility in the market prices of

these companies’ stock.

Such litigation, if instituted against us, could cause the Company to incur substantial costs and divert

our management’s attention and resources, which could have a material adverse effect on our business, financial condition and results

of operations.

changes in laws or regulations

applicable to any product candidates, including but not limited to clinical trial requirements for approvals;

future issuances of debt

or equity securities;

actual or anticipated fluctuations

in the Company’s financial condition and operating results, including fluctuations in our quarterly and annual results;

the Company’s inability

to establish additional partnerships, the termination of license agreements by our existing partners or announcements by our partners

regarding therapeutic candidates competitive with ours;

the introduction of new

technologies or enhancements to existing technology by the Company or others in the industry;

the recruitment or departure

of key scientific or management personnel;

announcements of significant

acquisitions, strategic partnerships, joint ventures or capital commitments by the Company or our competitors;

the Company’s failure

to meet the estimates and projections of the investment community or that we may otherwise provide to the public;

publication of research

reports about the Company or our industry, or antibody discovery in particular, or positive or negative recommendations or withdrawal

of research coverage by securities analysts;

changes in the market valuations

of similar companies;

overall performance of

the equity markets;

announcements or actions

taken by Citius Oncology, as a majority-owned subsidiary of the Company;

the planned distribution

of shares common stock of Citius Oncology by Citius Pharma;

sales of shares of common

stock by Citius Pharma;

trading volume of the Company’s

common stock;

legal disputes or other

developments relating to proprietary rights, including patents, litigation matters and Company’s ability to obtain and maintain

patent protection of its product candidates, government investigations and the results of any proceedings or lawsuits, including,

but not limited to, patent or stockholder litigation;

significant lawsuits, including

patent or stockholder litigation;

the impact of any natural

disasters or public health emergencies;

general economic, industry

and market conditions other events or factors, many of which are beyond the Company’s control;

changes in accounting standards,

policies, guidelines, interpretations or principles.

In addition, in the past,

stockholders have initiated Company action lawsuits against biotechnology and biopharmaceutical companies following periods of volatility

in the market prices of these companies’ stock.

Such litigation, if instituted against us, could cause the Company to incur substantial

costs and divert our management’s attention and resources, which could have a material adverse effect on our business, financial

condition and results of operations.

You may experience dilution of your ownership

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For the foreseeable future until LYMPHIR generates

revenue, if at all, we will need to raise capital to finance our operations, including possible acquisitions or strategic transactions.

To do so we might be required to issue equity securities, resulting in the dilution of the ownership interests of our present stockholders.

We are currently authorized to issue an aggregate of 16,000,000 shares of common stock and 10,000,000 shares of preferred stock.

September 30, 2024, after considering the impact of the subsequent 1-for-25 reverse stock split, there were 7,247,243 shares of common

stock outstanding, 2,945,337 shares underlying warrants with a weighted average exercise price of $31.685 per share and 656,084 shares

underlying options with a weighted average exercise price of $36.41 per share.

We may also issue additional shares of our common stock

or other securities that are convertible into or exercisable for common stock in connection with hiring or retaining employees, or for

other business purposes.

The future issuance of any such additional shares of common stock or common stock equivalents may create downward

pressure on the trading price of our common stock or publicly traded warrants.

significant revenue, if at all, we will need to raise capital to finance our operations, including possible acquisitions or strategic

transactions.

To do so we might be required to issue equity securities, resulting in the dilution of the ownership interests of our present

stockholders.

We are currently authorized to issue an aggregate of 250,000,000 shares of common stock and 10,000,000 shares of preferred

As of September 30, 2025, there were 18,067,744 shares of common stock outstanding, 14,479,372 shares underlying warrants with

a weighted average exercise price of $7.41 per share and 839,510 shares underlying options with a weighted average exercise price of

$30.09 per share.

We may also issue additional shares of common stock or other securities that are convertible into or exercisable for

common stock in connection with hiring or retaining employees, or for other business purposes.

The future issuance of any such additional

shares of common stock or common stock equivalents may create downward pressure on the trading price of our common stock.

Our Certificate of Incorporation allows

for our Board of Directors to create new series of preferred stock without further approval by our stockholders, which could adversely

affect the rights of the holders of the common stock.

Our Board of Directors has the authority to issue

up to 10,000,000 shares of preferred stock and to fix and determine the relative rights and preferences of any such preferred stock without

further stockholder approval.

As a result, our Board of Directors could authorize the issuance of one or more series of preferred stock

that would grant preferential rights to our assets upon liquidation, the right to receive dividend payments before dividends are distributed

to the holders of common stock and the right to the redemption of the preferred shares, together with a premium, prior to the redemption

of the common stock.

In addition, our Board of Directors could authorize the issuance of a series of preferred stock that has greater

voting power than the common stock or that is convertible into our common stock, which could decrease the relative voting power of the

common stock or result in dilution to our existing stockholders.

We have not paid cash dividends in the past

and we do not expect to pay cash dividends in the foreseeable future.

for our Board to create new series of preferred stock without further approval by our stockholders, which could adversely affect the

rights of the holders of the common stock.

Our Board has the authority to issue up to 10,000,000

shares of preferred stock and to fix and determine the relative rights and preferences of any such preferred stock without further stockholder

As a result, our Board could authorize the issuance of one or more series of preferred stock that would grant preferential

rights to our assets upon liquidation, the right to receive dividend payments before dividends are distributed to the holders of common

stock and the right to the redemption of the preferred shares, together with a premium, prior to the redemption of the common stock.

In addition, our Board could authorize the issuance of a series of preferred stock that has greater voting power than the common stock

or that is convertible into our common stock, which could decrease the relative voting power of the common stock or result in dilution

to our existing stockholders.

For example, in April 2025, our Board authorized the issuance of Series A preferred stock.

Each share of

Series A preferred stock carried 1,000,000,000 votes and voted together with the outstanding shares of our common stock as a single class,

exclusively with respect to a proposed increase in the authorized shares allowed under our Amended and Restated Articles of Incorporation

and were not entitled to vote on any other matter.

The Series A preferred stock had no other voting rights, including in respect of any

other proposal to stockholders, except as otherwise mandated by applicable law.

The Series A preferred stock was not convertible into,

or exchangeable for, shares of any other class or series of stock or other securities of the Company.

The Series A preferred stock had

no rights with respect to any distribution of assets of the Company and was not entitled to receive dividends of any kind.

By its terms,

the Series A preferred stock was redeemed and retired on June 9, 2025.

We have not paid cash dividends in the

past and we do not expect to pay cash dividends in the foreseeable future.

Any return on investment may be limited to the capital appreciation,

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We have not paid cash dividends on our common

stock and we do not anticipate paying cash dividends on its capital in the foreseeable future.

The payment of dividends on the capital

stock will depend on the respective earnings, financial condition and other business and economic factors affecting them at such time

as the board of directors may consider relevant.

In addition, the ability to pay dividends may be limited by covenants in any future outstanding

indebtedness that either entity may incur.

Since we do not intend to pay dividends, a stockholder’s ability to receive a return

on such stockholder’s investment will depend on any future appreciation in the market value of the Company’s common stock.

There is no guarantee that the Company’s common stock will appreciate or even maintain the price at which its stockholders have

purchased it.

Provisions in our Amended and Restated Articles

of Incorporation, as amended, and under Nevada law could discourage a takeover that stockholders may consider favorable and may lead to

entrenchment of management.

stock and we do not anticipate paying cash dividends on our common stock in the foreseeable future.

The payment of dividends on our common

stock will depend on our earnings, financial condition and other business and economic factors affecting us at such time as the Board

may consider relevant.

In addition, our ability to pay dividends may be limited by covenants in any future outstanding indebtedness that

we may incur.

Since we do not intend to pay dividends, a stockholder’s ability to receive a return on such stockholder’s

investment will depend on any future appreciation in the market value of the Company’s common stock.

There is no guarantee that

our common stock will appreciate or even maintain the price at which our stockholders have purchased it.

Provisions in our Amended and Restated

Articles of Incorporation, as amended, and under Nevada law could discourage a takeover that stockholders may consider favorable and

may lead to entrenchment of management.

Provisions of our articles of incorporation and

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these provisions include:

the authorization of 10,000,000 shares of “blank check” preferred stock, the rights, preferences and privileges of which may be established and shares of which may be issued by our Board of Directors at its discretion from time to time and without stockholder approval;

limiting the removal of directors by the stockholders;

allowing for the creation of a staggered Board of Directors;

eliminating the ability of stockholders to call a special meeting of stockholders;

establishing advance notice requirements for nominations for election to the Board of Directors or for proposing matters that can be acted upon at stockholder meetings.

the authorization of 10,000,000

shares of “blank check” preferred stock, the rights, preferences and privileges of which may be established and shares

of which may be issued by our Board of Directors at its discretion from time to time and without stockholder approval;

limiting the removal of

directors by the stockholders;

allowing for the creation

of a staggered Board of Directors;

eliminating the ability

of stockholders to call a special meeting of stockholders;

establishing advance notice

requirements for nominations for election to the Board of Directors or for proposing matters that can be acted upon at stockholder

Additionally , Nevada’s “combinations

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in the absence of prior approval, certain restrictions may apply even after such two-year period.

For purposes of these statutes, an “interested

stockholder” is any person who is (x) the beneficial owner, directly or indirectly, of 10% or more of the voting power of the outstanding

voting shares of the corporation, or (y) an affiliate or associate of the corporation and at any time within the two previous years was

the beneficial owner, directly or indirectly, of 10% or more of the voting power of the then outstanding shares of the corporation.

definition of the term “combination” is sufficiently broad to cover most significant transactions between the corporation

and an “interested stockholder”.

Subject to certain timing requirements set forth in the statutes, a corporation may elect

not to be governed by these statutes.

For purposes of these statutes, an

“interested stockholder” is any person who is (x) the beneficial owner, directly or indirectly, of 10% or more of the voting

power of the outstanding voting shares of the corporation, or (y) an affiliate or associate of the corporation and at any time within

the two previous years was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the then outstanding shares

of the corporation.

The definition of the term “combination” is sufficiently broad to cover most significant transactions

between the corporation and an “interested stockholder”.

Subject to certain timing requirements set forth in the statutes,

a corporation may elect not to be governed by these statutes.

We have not included any such provision in our articles of incorporation.

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

What changed 10-K

Item 1A. Risk Factors