What changed in this filing

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Item 1. Financial Statements

2026-05-13 compared with 2025-11-14 · 572 added, 517 removed, 311 unchanged (78% of the section changed)

1 unchanged sentence

THERAPEUTICS, INC.

September 30,

March 31, 2026

December 31, 2025

Cash and cash equivalents

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Stockholders’ Equity:

Preferred Stock, par value $ 0.0001 per share, 10,000,000 shares authorized;

no shares issued or outstanding as of September 30, 2025 and December 31, 2024

Common Stock, par value $ 0.0001 per share, 250,000,000 shares authorized;

844,457 shares issued and outstanding as of September 30, 2025;

Common Stock, par value $ 0.0001 , 250,000,000 shares authorized;

4,022,143 shares issued and outstanding as of March 31, 2026;

2,660,110 shares issued and outstanding as of December 31, 2025.

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For the three months ended

September 30,

the nine months ended

September 30,

Operating expenses:

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( 2,339,803 )

( 5,873,205 )

( 9,312,954 )

Other income and expenses:

2 unchanged sentences

$ ( 2,303,587 )

$ ( 5,696,669 )

$ ( 9,136,523 )

Net loss per share of Common Stock, basic and diluted

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$ ( 73,233,896 )

Stock-based compensation

Issuance of Common Stock and warrants from January 2025 PIPE, net of issuance costs

Issuance of Common Stock from ATM sales, net of issuance costs

Issuance of Common Stock upon exercise of pre-funded warrants

Issuance of Common Stock and warrants from March 2025 Warrant Inducement, net of issuance costs

( 2,303,587 )

Balance at March 31, 2025

$ ( 67,978,926 )

Stock-based compensation

Issuance of abeyance shares

Issuance costs related to the March 2025 Warrant Inducement

( 1,847,706 )

Balance at June 30, 2025

$ ( 69,680,019 )

Stock-based compensation

Issuance of abeyance shares

( 1,691,989 )

Balance at September 30, 2025

Balance at March 31, 2026

$ ( 75,081,602 )

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$ ( 65,675,339 )

Stock-based compensation

Issuance of abeyance shares

$ ( 65,675,339 )

( 3,134,262 )

Balance at March 31, 2024

$ ( 56,522,140 )

Stock-based compensation

Issuance of Common Stock upon exercise of warrants, net of issuance costs

Settlement of fractional shares paid in cash

( 2,829,106 )

Balance at June 30, 2024

$ ( 59,351,246 )

Stock-based compensation

Issuance of pre-funded warrants and warrants, net of issuance costs

Issuance of Common Stock and warrants from January 2025 PIPE, net of issuance costs

Issuance of Common Stock upon exercise of pre-funded warrants

Issuance of Common Stock from ATM sales, net of issuance costs

Issuance of abeyance shares

Issuance of Common Stock and warrants from March 2025 Warrant Inducement, net of issuance costs

Stock-based compensation

( 2,303,587 )

Balance at September 30, 2024

Balance at March 31, 2025

$ ( 67,978,926 )

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of Cash Flows

the nine months ended

September 30,

For the three months ended

Cash flows from operating activities:

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Accrued and other current liabilities

Total adjustments to reconcile net loss to net cash used in operations

Net cash used in operating activities

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Cash flows from financing activities:

Proceeds from issuance of Common Stock and warrants, net of issuance costs

Payment of prior period issuance costs

Proceeds from issuance of Common Stock from ATM sales, net of issuance costs

Proceeds from issuance of Common Stock, pre-funded warrants, and warrants, net of issuance costs

Proceeds from exercise of pre-funded warrants

Payment for fractional shares in reverse stock split

Payment of issuance costs

Net cash provided by financing activities

Net increase (decrease) in Cash and cash equivalents

( 1,294,383 )

Cash and cash equivalents at beginning of period

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Non-cash financing activities:

Issuance of abeyance shares

Issuance costs in accounts payable or accrued expenses

Supplemental disclosure:

Cash paid for taxes

Issuance Common Stock upon exercise of pre-funded warrants

ATM issuance costs in accrued expenses

January 2025 PIPE issuance costs in accounts payable

March 2025 Warrant Inducement issuance costs in accounts payable

accompanying notes are an integral part of these financial statements.

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its name to Dermata Therapeutics, Inc.

The Company is a development stage biotechnology company focused on the treatment of medical and

aesthetic skin conditions and diseases.

On August 17, 2021, the Company completed its initial public offering.

The Company’s shares

of Common Stock and warrants are listed on the Nasdaq Stock Market LLC (“Nasdaq”) under the symbols “DRMA,” and

“DRMAW,” respectively.

During September 2025, the Company made a strategic shift from researching and developing prescription

products to becoming a science-driven leader in dermatologic solutions anticipating the launch of its first direct-to-consumer (“DTC”)

products from its Tome skincare line in mid-2026.

July 15, 2025, the Company held its annual meeting of stockholders at which time the stockholders approved the adoption of an amendment

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split for all periods presented.

May 7, 2024, the Company held its annual meeting of stockholders at which time the stockholders approved the adoption of an amendment

to its Amended and Restated Certificate of Incorporation, as amended, to effect a reverse stock split of its issued and outstanding shares

of Common Stock, at a specific ratio, ranging from one-for-five to one-for-thirty, with the exact ratio determined by the Company’s

board of directors without further approval or authorization of its stockholders.

On May 16, 2024, the Company effected the reverse split

of its shares of Common Stock at a ratio of 1-for-15, as approved by the Company’s board of directors.

The par value was not adjusted

as a result of the May 2024 reverse stock split.

All issued and outstanding shares of Common Stock and per share amounts contained in

the financial statements have been retroactively adjusted to reflect this reverse stock split for all periods presented.

and Going Concern Uncertainty

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any revenue or commercialized any product candidates.

As of September 30, 2025, cash and cash equivalents totaled $ 4.7 million and the

Company had an accumulated deficit of $ 71.4 million.

For the nine months ended September 30, 2025, and the year ended December 31, 2024,

the Company used cash of $ 6.4 million and approximately $ 11.1 million, respectively, in operations.

The Company’s cash and cash

equivalents are expected to fund operations into the second quarter of 2026.

As of March 31, 2026, cash and cash equivalents totaled $ 6.9 million, and the Company

had an accumulated deficit of $ 75.1 million.

For the three months ended March 31, 2026, and the year ended December 31, 2025, the Company

used cash of approximately $ 2.5 million and approximately $ 7.8 million, respectively, in operations.

The Company’s existing cash

and cash equivalents are expected to fund operations into the first quarter of 2027.

Company anticipates that it will continue to incur net losses for at least the next twelve months from the date of this filing.

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The Company’s

principal use of cash has been for operations, and the Company expects that the principal uses of cash in the future will

be for continuing operations, marketing and commercialization activities for current and future product candidates, funding of research

and development, conducting preclinical studies and clinical trials, and general working capital requirements.

The Company expects that

as marketing expenses continue to grow, it will need to raise additional capital to sustain operations.

principal use of cash has been for operations, and the Company expects that the principal uses of cash in the future will be for continuing

operations, including various marketing expenditures, including, but not limited to, branding, paid media, marketing use studies, advertising,

software subscriptions, and launch events and tradeshows, as well as non-marketing expenses including funding of research and development,

and general working capital requirements.

The Company expects that as marketing expenses continue to grow, it will need to raise additional

capital to sustain operations.

Plan to Continue as a Going Concern

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generate significant cash from operations, management’s plans to obtain such resources for the Company include proceeds from offerings

of the Company’s equity securities or debt, generating product revenue from sales of over the counter (“OTC”) products, or transactions involving product

development, technology licensing or collaboration.

Management can provide no assurance that any sources of a sufficient amount of financing

or collaboration agreements will be available to the Company on favorable terms, if at all.

The Company’s ability to raise additional

capital may be adversely impacted by potential worsening of global economic conditions, tariffs, potential future global pandemics or

health crises, and the disruptions to, and volatility in, the credit and financial markets in the United States.

Because of historical

and expected operating losses and net operating cash flow deficits, there is substantial doubt about the Company’s ability to continue

as a going concern for one year from the issuance of the financial statements, which is not alleviated by management’s plans.

accompanying financial statements have been prepared assuming that the Company will continue as a going concern.

The financial statements

do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts

and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

of the Company’s equity securities or debt, generating product revenue from sales of skincare products, or transactions involving

product development, technology licensing or collaboration.

Management can provide no assurance that any sources of a sufficient amount

of financing or collaboration agreements will be available to the Company on favorable terms, if at all.

The Company’s ability

to raise additional capital may be adversely impacted by potential worsening of global economic conditions, tariffs, potential future

global pandemics or health crises, and the disruptions to, and volatility in, the credit and financial markets in the United States.

Because of historical and expected operating losses and net operating cash flow deficits, there is substantial doubt about the Company’s

ability to continue as a going concern for one year from the issuance of the financial statements, which is not alleviated by management’s

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.

The financial

statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or

the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

of Presentation

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statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed with

Securities and Exchange Commission (the “SEC”) on March 17, 2025, which includes a broader discussion of the Company’s

the Securities and Exchange Commission (the “SEC”) on March 26, 2026, which includes a broader discussion of the Company’s

business and the risks inherent therein.

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On an ongoing basis, management evaluates these

estimates and judgments, including those related to accrued research and development expenses, stock-based compensation, and equity instruments.

The Company bases its estimates on various assumptions that it believes are reasonable under the circumstances.

Actual results may differ

from these estimates under different assumptions or conditions.

estimates and judgments, including those related to stock-based compensation.

The Company bases its estimates on various assumptions

that it believes are reasonable under the circumstances.

Actual results may differ from these estimates under different assumptions or

segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief

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and Cash Equivalents

Company deposits its cash and cash equivalents with accredited financial institutions that are insured by the Federal Deposit Insurance

Corporation (“FDIC”), which are held in checking and cash sweep accounts.

At times, deposits held may exceed the amount of

insurance provided by the FDIC.

The Company maintains an insured cash sweep account in which cash from its main operating checking account

is invested overnight in highly liquid, short-term investments.

The Company considers all highly liquid investments with a maturity date

of 90 days or less at the date of purchase to be cash equivalents.

Company deposits its cash and cash equivalents with accredited financial institutions.

Cash and cash equivalents are held in business

checking, cash sweep, and overnight money market mutual fund accounts.

Only the business checking account is insured by the Federal Deposit

Insurance Corporation (“FDIC”), with coverage up to $ 250,000 .

Cash and cash equivalent deposits in excess of $ 250,000 are

not covered by insurance provided by the FDIC.

The cash sweep and overnight money market mutual fund accounts are invested overnight

in highly liquid, short-term investments.

The Company considers all highly liquid investments with a maturity date of 90 days or less

at the date of purchase to be cash equivalents.

Concentrations

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instruments that potentially subject the Company to a concentration of credit risk consist primarily of cash and cash equivalents.

Company is exposed to credit risk in the event of a default by the financial institutions holding the Company’s cash and cash equivalents

to the extent of the amounts held in excess of FDIC limits.

The Company limits its credit risk by placing its cash and cash equivalents

with financial institutions it believes are of high quality.

To date, the Company has not experienced any losses on its deposits of cash

and cash equivalents.

Company is exposed to credit risk in the event of a default by the financial institutions holding the Company’s cash sweep and

overnight money market mutual fund accounts, and the Company’s business checking account, to the extent of the amounts held in

excess of FDIC limits.

The Company limits its credit risk by placing its cash and cash equivalents with financial institutions it believes

are of high quality.

To date, the Company has not experienced any losses on its deposits of cash and cash equivalents, and periodically

evaluates the creditworthiness of its financial institutions.

Value Measurement

Company uses a three-tier fair value hierarchy to prioritize the inputs used in the Company’s fair value measurements.

Level 1, defined as observable inputs such as quoted prices in active markets for identical assets;

include Level 1, defined as observable inputs such as quoted prices in active markets for identical assets;

Level 2, defined as inputs

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The Company believes the carrying

amount of cash and cash equivalents, accounts payable and accrued expenses approximate their estimated fair values due to the short-term

nature of these assets and liabilities.

Additionally, the Company’s warrants are equity classified and thereby Level 1 when determining

See further discussion in Note 4 – Equity Securities.

amount of cash and cash equivalents and accounts payable approximate their estimated fair values due to the short-term nature of these

assets and liabilities.

consists of raw materials procured for the purpose of manufacturing the Company’s Tome skincare products and is stated at the lower

of cost or net realizable value.

Costs for inventory include shipping, delivery, freight, non-refundable taxes, duties, and other landing

The Company’s policy is to perform an assessment of the recoverability of capitalized inventory during each reporting period

and to write down any excess, obsolete, damaged, or expired materials to their estimated realizable value in the period in which the

impairment is first identified.

Given the early stage of the Company’s commercialization strategy, no impairments of inventory

have been recorded as of March 31, 2026.

income consists of interest income earned on cash and cash equivalents from interest bearing demand accounts.

costs related to obtaining and maintaining patent protection in both the United States and other countries are expensed as incurred.

Patents costs are classified as selling, general and administrative expenses.

Patent costs are classified as selling, general and administrative expenses.

and Development Costs

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Research and development costs primarily consist of salaries and related expenses

for personnel, stock-based compensation expense, external research and development costs incurred under agreements with contract research

organizations, investigative sites and consultants to conduct clinical studies, costs related to compliance with regulatory requirements,

costs related to manufacturing the Company’s product candidates for clinical trials, and other allocated expenses.

for personnel, including stock-based compensation expense and discretionary incentive bonuses, if any, external research and development

costs incurred under agreements with contract research or laboratory organizations, costs related to compliance with regulatory requirements,

costs related to developing future product candidates, and other allocated expenses.

for research and development activities are based on the terms of the individual agreements, which may differ from the pattern of costs

incurred, and payments made in advance of performance are reflected in the accompanying balance sheets as prepaid expenses.

records accruals for estimated costs incurred for ongoing research and development activities.

When evaluating the adequacy of the accrued

liabilities, the Company analyzes progress of the services, including the phase or completion of events, invoices received and contracted

The Company uses judgments and estimates to determine the prepaid or accrued balances at the end of any reporting period.

results could differ from the Company’s estimates.

incurred, and payments made in advance of performance are reflected in the accompanying balance sheets as prepaid expenses and other

current assets.

The Company records accruals for estimated costs incurred for ongoing research and development activities.

When evaluating

the adequacy of the accrued liabilities, the Company analyzes progress of the services, including the phase or completion of events,

invoices received, and contracted costs.

The Company uses judgments and estimates to determine the prepaid or accrued balances at the

end of any reporting period.

Actual results could differ from the Company’s estimates.

General and Administrative Costs

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Selling, general and administrative costs primarily consist of

marketing-related expenses, salaries and related expenses for personnel, including stock-based compensation, as well as legal fees incurred

relating to corporate and patent matters, professional fees incurred for accounting, auditing, tax, and other consulting services, and

insurance costs.

Company is a C-corporation and accounts for income taxes under the asset and liability method, which requires the recognition of deferred

tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements.

this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statements and

tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment

personnel-related expenses, including stock-based compensation and discretionary incentive bonuses, if any, marketing and brand-related

expenses, including marketing studies of current and planned product candidates, paid media and advertising costs, as well as legal fees

incurred relating to corporate and patent matters, professional fees incurred for accounting, auditing, tax, and other consulting services,

insurance costs, and other allocated expenses.

for selling, general and administrative activities are based on the terms of the individual agreements, which may differ from the pattern

of costs incurred, and payments made in advance of performance are reflected in the accompanying balance sheets as prepaid expenses and

other current assets.

The Company records accruals for estimated costs incurred for ongoing selling, general and administrative activities.

When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the services, including the phase or completion

of events, invoices received, and contracted costs.

The Company uses judgments and estimates to determine the prepaid or accrued balances

at the end of any reporting period.

Actual results could differ from the Company’s estimates.

Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities

for the expected future tax consequences of events that have been included in the financial statements.

Under this method, deferred tax

assets and liabilities are determined on the basis of the differences between the financial statements and tax basis of assets and liabilities

using enacted tax rates in effect for the year in which the differences are expected to reverse.

The effect of a change in tax rates

on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

Company recognizes net deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized.

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The Company did not have other comprehensive

income (loss) items such as unrealized gains and losses and so for the periods presented, comprehensive loss was equal to the net loss.

income (loss) items such as unrealized gains and losses.

As such, for the three months ended March 31, 2026, and 2025, comprehensive

loss was equal to the net loss.

Loss Per Share of Common Stock

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equivalents but are excluded from the calculation of diluted net loss per common stock if their effect would be anti-dilutive.

common share equivalents that are not included in the calculation of diluted net loss per share of Common Stock but could potentially

dilute basic earnings per share in the future are as follows:

common share equivalents that are not included in the calculation of diluted net loss per common share but could potentially dilute basic

earnings per share in the future are as follows:

of Potentially Diluted Basic Earnings Per Share

September 30,

Common Stock options outstanding

Common Stock warrants outstanding

Common Stock options

Common Stock warrants

Total potentially dilutive securities

Accounting Pronouncements

the nine months ended September 30, 2025, the Company has reviewed recent accounting standards and identified the following as relevant

to the Company.

December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”) .

ASU 2023-09 requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information

on income taxes paid.

ASU 2023-09 is effective for public entities with annual periods beginning after December 15, 2024, with early

adoption permitted.

The Company adopted ASU 2023-09 as of January 1, 2025;

however, there was no impact on its financial statements and

income tax footnote.

November 2024, the FASB issued ASU No.

2024-03, Disaggregation of Income Statement Expenses (“ASU 2024-03”) .

the three months ended March 31, 2026, the Company reviewed recent accounting standards and identified the following as relevant to the

November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (“ASU 2024-03”) .

requires additional disclosures and disaggregation of certain costs and expenses presented on the face of the income statement.

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The Company is currently evaluating the impact of this guidance on its financial statements.

September 2025, the FASB issued ASU No.

2025-06 , Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software .

ASU 2025-06 updates the accounting for internal-use software by

replacing former stage-based rules with a principles-based framework.

Entities will now capitalize costs associated with internal-use

software only when management has authorized and committed funding and it is probable that the project will be completed and the software

will be used to perform the intended function.

ASU 2025-06 also supersedes website development cost guidance, moving it to ASC 350-40.

These amendments are effective for interim and annual periods beginning after December 15, 2027, with early adoption permitted.

elected to early adopt this accounting guidance prospectively as of January 1, 2026, which did not have a material impact on its financial

statements or its related disclosures.

December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270):

Narrow-Scope Improvements , which clarifies the guidance

in Topic 270 to improve the consistency of interim financial reporting.

The ASU provides a comprehensive list of required interim disclosures

and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have

a material impact on the entity.

ASU 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim periods

within those fiscal years, with early adoption permitted.

The Company is currently evaluating the impact of adopting ASU 2025-11 on its

financial statements and related disclosures.

Balance Sheet Details

following provides certain balance sheet details:

Schedule of Balance Sheet Details

September 30,

of Balance Sheet Details

Raw materials

Total inventory

Prepaid expenses and other current assets:

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Prepaid research and development costs

Prepaid other and other current assets

Prepaid marketing expenses

Prepaid annual subscriptions

Prepaid other

Deposit for inventory manufacturing

Deposit for property, plant and equipment

Total prepaid expenses and other current assets

Accrued and other current liabilities:

Accrued research and development costs

Accrued compensation and benefits

Accrued legal fees

Accrued consulting fees

Accrued other

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Equity Securities

summary of the Company’s equity securities as of September 30, 2025, is as follows:

of Equity Securities

summary of the Company’s equity securities as of March 31, 2026, is as follows:

Equity Securities

Common Stock, par value $0.0001

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2021 Omnibus Equity Incentive Plan

Nonqualified Inducement Stock Option Grant

Total equity securities

March 27, 2025, the Company entered into an inducement offer letter agreement (the “March 2025 Inducement Letter”) with

a holder (the “Holder”) of certain of its existing warrants to purchase an aggregate of 483,447

shares of the Company’s Common Stock.

Such existing warrants were made up of (i) certain of the May 17, 2024 warrants (the

“May 2024 Warrants”), which were issued in two separate series, having an exercise price of $ 49.10

per share, and (ii) the September 16, 2024 warrants, which were issued in two separate series, having an exercise price of $ 15.80

per share (the “September 2024 Warrants” and together with the May 2024 Warrants, the “Existing Warrants”).

Pursuant to the March 2025 Inducement Letter, the Holder agreed to exercise for cash its Existing Warrants at a reduced exercise

price of $ 12.84

per share in consideration for the Company’s agreement to issue in a private placement (i) new Series A common stock purchase

warrants (the “New Series A Warrants”) to purchase up to 498,080

shares of Common Stock (the “New Series A Warrant Shares”) and (ii) new Series B common stock purchase warrants (the

“New Series B Warrants” and together with the New Series A Warrants, the “New Warrants”) to purchase up to 468,813

shares of Common Stock (the “New Series B Warrant Shares” and together with the New Series A Warrant Shares, the

“New Warrant Shares”).

The New Warrants were exercisable subject to stockholder approval, which the Company received at

a stockholder meeting on July 15, 2025.

The Company received net proceeds of approximately $ 5.7

million from the exercise of the Existing Warrants by the Holder, after deducting financial advisor fees and other offering expenses

payable by the Company.

As of September 30, 2025, the Holder has received 301,447

Common Shares, with the balance of 182,000

shares held in abeyance, to be released to the Holder at the Holder’s request.

January 2026, the Company extended its At The Market Offering Agreement (the “ATM Agreement”) with its sales agent (the “Sales

Agent”), providing for the additional sale of up to $ 705,000

of its shares of Common Stock as set forth in the ATM Agreement,

adding to the registered capacity of approximately $ 1.4

million which remained as of December 31, 2025, for total remaining

capacity of approximately $ 2.1

During January 2026, the Company issued 824,283

shares of its Common Stock under the ATM Agreement, resulting

in net proceeds of approximately $ 2.0

million after paying the Sales Agent a fixed commission rate

of approximately $ 67,000 and other transactional fees.

After issuance of the 824,283

shares of its Common Stock under its ATM Agreement during January

2026, no capacity remained under the Company’s ATM Agreement.

December 29, 2025, the Company closed a private placement (the “December 2025 PIPE”) priced at the market under Nasdaq rules,

in which it sold 1,484,312 shares of Common Stock, pre-funded warrants to purchase an aggregate of 537,750 shares of Common Stock with

an exercise price of $ 0.001 per share (“December 2025 Pre-Funded Warrants”), 2,022,062 Series C warrants (the “Series

C Warrants”) to purchase up to an aggregate of 2,022,062 shares of Common Stock, and 2,022,062 Series D warrants (the “Series

D Warrants”) to purchase up to an aggregate of 2,022,062 shares of Common Stock (together the “December 2025 PIPE Warrants”),

for gross proceeds of approximately $ 4.1 million.

The December 2025 PIPE Warrants have an exercise price of $ 2.04 .

Certain Company insiders,

including the Company’s Chief Executive Officer and Chief Financial Officer, participated in the December 2025 PIPE.

These Company

insiders purchased an aggregate of 735,294 shares of Common Stock and December 2025 PIPE Warrants to purchase up to an aggregate of 1,470,588

shares of Common Stock, for an aggregate purchase price of approximately $ 1.5 million.

The purchase price per share of Common Stock and

accompanying December 2025 PIPE Warrants for these Company insiders was the same as paid by other investors in the December 2025 PIPE.

The December 2025 PIPE Warrants are exercisable subject to stockholder approval.

In connection with the December 2025 PIPE, the Company

entered into a registration rights agreement with the investors, pursuant to which the Company agreed to prepare and file a registration

statement with the Securities and Exchange Commission (“SEC”) registering the resale of the shares of Common Stock underlying

the securities sold in the December 2025 PIPE financing.

The Company filed a Form S-3 on January 22, 2026, which was declared effective

by the SEC on January 29, 2026.

The Company received net cash proceeds of approximately $ 3.8 million from the December 2025 PIPE after

deducting approximately $ 0.3 million of placement agent fees and legal and audit firm fees.

During the first quarter of 2026, all of

the 537,750 December 2025 Pre-Funded Warrants were exercised, leaving no prefunded warrants outstanding.

Wainwright & Co., LLC (“Wainwright”) acted as the exclusive placement agent for the December 2025 PIPE.

In addition to

the placement agent fees, the Company issued to Wainwright, or its designees, warrants (the “December 2025 PIPE Placement Agent

Warrants”) to purchase up to an aggregate of 141,544 shares of Common Stock at an exercise price equal to $ 2.55 per share.

grant date fair value of the December 2025 PIPE Placement Agent Warrants was $ 0.2 million, which represents a non-cash issuance cost,

and which was determined using the Black-Scholes option pricing model, using the following significant assumptions:

expected term of

5.4 years, expected volatility of 134.9 %, risk-free interest rate of 3.67 % and dividend yield of 0.0 %.

November 2025, the Company extended its ATM Agreement with its Sales Agent, providing for the additional sale of up to approximately

$ 1.8 million of its shares of Common Stock as set forth in the ATM Agreement.

The Sales Agent was entitled to compensation at a fixed

commission rate of 3.0 % of the gross sales price of the shares of Common Stock sold pursuant to the ATM Agreement, as well as other transactional

During December 2025, the Company issued 149,341 shares of Common Stock under the ATM Agreement resulting in gross proceeds of

$ 0.4 million before deducting approximately $ 15,000 of Sales Agent issuance costs.

After issuance of the 149,341 shares during December

2025, approximately $ 1.4 million remained registered under the ATM Agreement as of December 31, 2025, which was subsequently utilized

during the first quarter of 2026, leaving no remaining capacity as of March 31, 2026.

March 27, 2025, the Company entered into an inducement offer letter agreement (the “March 2025 Inducement Letter”) with a

holder (the “Holder”) of certain of its existing warrants to purchase an aggregate of 483,447 shares of the Company’s

Common Stock.

Such existing warrants were made up of (i) certain of the May 17, 2024 warrants (the “May 2024 Warrants”),

which were issued in two separate series, having an exercise price of $ 49.10 per share, and (ii) the September 16, 2024 warrants, which

were issued in two separate series, having an exercise price of $ 15.80 per share (the “September 2024 Warrants” and together

with the May 2024 Warrants, the “Existing Warrants”), for gross proceeds of approximately $ 6.2 million.

Pursuant to the March

2025 Inducement Letter, the Holder agreed to exercise for cash its Existing Warrants at a reduced exercise price of $ 12.84 per share

in consideration for the Company’s agreement to issue in a private placement (i) new Series A common stock purchase warrants (the

“New Series A Warrants”) to purchase up to 498,080 shares of Common Stock and (ii) new Series B common stock purchase warrants

(the “New Series B Warrants” and together with the New Series A Warrants, the “New Warrants”) to purchase up

to 468,813 shares of Common Stock.

The New Warrants were exercisable subject to stockholder approval, which the Company received at a

stockholder meeting on July 15, 2025.

The Company received net proceeds of approximately $ 5.7 million from the exercise of the Existing

Warrants by the Holder, after deducting approximately $ 0.5 million of financial advisor fees and legal and audit firm fees.

acted as the exclusive financial advisor for the March 2025 inducement.

In addition to the financial advisor fees, the Company issued

to Wainwright, or its designees, warrants (the “March 2025 Financial Advisor Warrants”) to purchase up to an aggregate of

33,840 shares of Common Stock at an exercise price equal to $ 16.05 per share.

The grant date fair value of the March 2025 Financial Advisor

Warrants was $ 0.4 million, which represents a non-cash issuance cost, and which was determined using the Black-Scholes option pricing

model, using the following significant assumptions:

expected term of 5.3 years, expected volatility of 143.0 %, risk-free interest rate

of 3.98 % and dividend yield of 0.0 %.

January 21, 2025, the Company closed a private placement (the “January 2025 PIPE”) priced at the market under Nasdaq rules,

1 unchanged sentence

exercise price of $ 0.01 per share (“January 2025 Pre-Funded Warrants”), and 200,785 warrants (the “January 2025 PIPE

Warrants”) to purchase up to an aggregate of 200,785 shares of Common Stock.

The January 2025 PIPE Warrants have an exercise price

Certain Company insiders, including the Company’s Chief Executive Officer, Chief Financial Officer and certain members

of the Company’s board of directors, participated in the January 2025 PIPE.

These Company insiders purchased an aggregate of 122,047

shares of Common Stock and January 2025 PIPE Warrants to purchase up to an aggregate of 122,047 shares of Common Stock, for an aggregate

purchase price of approximately $ 1,550,000 .

The purchase price per share of Common Stock and accompanying January 2025 PIPE Warrant for

these Company insiders was the same as paid by other investors in the January 2025 PIPE.

The January 2025 Warrants were exercisable subject

to stockholder approval, which the Company received at a stockholder meeting on July 15, 2025.

In connection with the January 2025 PIPE,

the Company entered into a registration rights agreement with the investors, pursuant to which the Company agreed to prepare and file

a registration statement with the SEC registering the resale of the shares of Common Stock underlying the securities sold in the January

2025 PIPE financing.

The Company filed a Form S-3 on January 30, 2025, which was declared effective by the SEC on February 5, 2025.

Company received net cash proceeds of approximately $ 2.2 million from the January 2025 PIPE after deducting underwriters’ discounts

and offering expenses of approximately $ 0.4 million.

During the first quarter of 2025, all of the January 2025 Pre-Funded Warrants were

As of September 30, 2025, no January 2025 Pre-Funded Warrants remained outstanding.

September 17, 2024, the Company closed a private placement (the “September 2024 PIPE”) priced at the market under Nasdaq

rules, in which it sold 191,256 pre-funded warrants to purchase up to an aggregate of 191,256 shares of Common Stock with an exercise

price of $ 0.01 per share (the “September 2024 Pre-Funded Warrants”), and 191,256 series A warrants (the “September

2024 PIPE Series A Common Warrants”) to purchase up to an aggregate of 191,256 shares of Common Stock and 191,256 series B warrants

(the “September 2024 PIPE Series B Common Warrants” and together with the September 2024 PIPE Series A Warrants, the “September

2024 PIPE Warrants”) to purchase up to an aggregate of 191,256 shares of Common Stock.

The September 2024 PIPE Warrants have an

exercise price of $ 15.80 .

In connection with the September 2024 PIPE, the Company entered into a registration rights agreement with the

investor, pursuant to which the Company agreed to prepare and file a registration statement with the SEC registering the resale of the

shares of Common Stock underlying the securities sold in the September 2024 PIPE financing.

The Company filed a Form S-3 on September

19, 2024, which was declared effective by the SEC on September 24, 2024.

The Company received net cash proceeds of approximately $ 3.1

million from the September 2024 PIPE after deducting underwriters’ discounts and offering expenses of approximately $ 0.4 million.

As of December 31, 2024, 90,500 September 2024 Pre-Funded Warrants remained outstanding, which were exercised during the first quarter

As of September 30, 2025, no September 2024 Pre-Funded Warrants remained outstanding.

June 2024, the Company entered into an At The Market Offering Agreement (the “ATM Agreement”) with a sales agent (the “Sales

Agent”), providing for the sale of up to $ 1,157,761 of its shares of Common Stock as set forth in the ATM Agreement.

Agent will be entitled to compensation at a fixed commission rate of 3.0 % of the gross sales price of the shares of Common Stock sold

pursuant to the ATM Agreement, as well as other transactional fees.

During July 2024, the Company issued 35,580 shares of Common Stock

under the ATM Agreement resulting in gross proceeds of $ 1,157,248 before deducting issuance costs.

After issuance of the 35,580 shares

during July 2024, $ 513 remained registered under the ATM Agreement.

On August 2, 2024, the Company increased the maximum aggregate offering

amount of Common Stock issuable under the ATM Agreement by $ 505,000 , from $ 1,157,761 to $ 1,662,761 .

During September 2024, the Company

issued 19,421 shares of Common Stock under the ATM Agreement resulting in additional gross proceeds of $ 504,894 before deducting issuance

During 2024, the Company issued a total of 55,001 shares from its ATM resulting in net proceeds of $ 1.5 million after deducting

issuer costs and other expenses related to setting up and issuing shares from the Company’s ATM.

On November 7, 2025, the

Company filed a prospectus supplement, pursuant to which the Company may offer and sell, from time to time through Sales Agent,

shares of its Common Stock for aggregate proceeds of an additional $ 1,792,315

(upon the terms and subject to the conditions and limitations set forth in the ATM Agreement).

As of the date of this filing, the Company has not sold any additional shares under the ATM Agreement.

May 21, 2024, the Company closed on inducement agreements (the “May 2024 Inducement”) with certain holders (the

“May 2024 Holders”) of certain of the Company’s existing warrants to purchase up to an aggregate of 51,632

shares of the Company’s Common Stock, issued to the May 2024 Holders on (i) May 26, 2023 (the “May 2023

Warrants”), having an exercise price of $ 324.00

per share, and (ii) November 20, 2023, which were issued in two separate series, each having an exercise price of $ 97.67

per share (together with the May 2023 Warrants, the “May 2024 Existing Warrants”).

Pursuant to the May 2024 Inducement,

the May 2024 Holders agreed to exercise for cash their May 2024 Existing Warrants at a reduced exercise price of $ 51.60

per share in consideration for the Company’s agreement to issue in a private placement (i) new Series A Common Stock purchase

warrants (the “New May 2024 Series A Warrants”) to purchase up to 60,117

shares of Common Stock, and (ii) new Series B Common Stock purchase warrants (the “New May 2024 Series B Warrants” and

together with the New May 2024 Series A Warrants, the “New May 2024 Warrants”) to purchase up to 43,149

shares of Common Stock.

The Company received net proceeds of approximately $ 2.3

million from the exercise of the May 2024 Existing Warrants by the Holders, after deducting placement agent fees and other offering

expenses payable by the Company.

to the May 2024 Inducement, during July 2024, the balance of 26,700 abeyance shares related to the May 2024 Warrant Inducement were released

to the investor, leaving no further abeyance shares outstanding as of December 31, 2024.

the Company has 10,000,000 shares of preferred stock authorized with a par value of $ 0.0001 , no shares of preferred stock are issued

or outstanding as of September 30, 2025, or December 31, 2024.

Warrants”) to purchase up to an aggregate of 200,785 shares of Common Stock, for gross proceeds of approximately $ 2.5 million.

The January 2025 PIPE Warrants have an exercise price of $ 12.70 .

Certain Company insiders, including the Company’s Chief Executive

Officer, Chief Financial Officer and certain members of the Company’s board of directors, participated in the January 2025 PIPE.

These Company insiders purchased an aggregate of 122,047 shares of Common Stock and January 2025 PIPE Warrants to purchase up to an aggregate

of 122,047 shares of Common Stock, for an aggregate purchase price of approximately $ 1.55 million.

The purchase price per share of Common

Stock and accompanying January 2025 PIPE Warrant for these Company insiders was the same as paid by other investors in the January 2025

The January 2025 Warrants were exercisable subject to stockholder approval, which the Company received at a stockholder meeting

on July 15, 2025.

In connection with the January 2025 PIPE, the Company entered into a registration rights agreement with the investors,

pursuant to which the Company agreed to prepare and file a registration statement with the SEC registering the resale of the shares of

Common Stock underlying the securities sold in the January 2025 PIPE financing.

The Company filed a Form S-3 on January 30, 2025, which

was declared effective by the SEC on February 5, 2025.

The Company received net cash proceeds of approximately $ 2.2 million from the

January 2025 PIPE after deducting approximately $ 0.3 million of placement agent fees and legal and audit firm fees.

During the first

quarter of 2025, all of the January 2025 Pre-Funded Warrants were exercised.

As of March 31, 2025, no January 2025 Pre-Funded Warrants

remained outstanding.

acted as the exclusive placement agent for the January 2025 PIPE.

In addition to the placement agent fees, the Company issued to Wainwright,

or its designees, warrants (the “January 2025 PIPE Placement Agent Warrants”) to purchase up to an aggregate of 14,053 shares

of Common Stock at an exercise price equal to $ 15.88 per share.

The grant date fair value of the January 2025 PIPE Placement Agent Warrants

was $ 0.2 million, which represents a non-cash issuance cost, and which was determined using the Black-Scholes option pricing model, using

the following significant assumptions:

expected term of 5.4 years, expected volatility of 145.7 %, risk-free interest rate of 4.45 % and

dividend yield of 0.0 %.

the Company has 10,000,000 shares of preferred stock authorized with a par value of $ 0.0001 , no shares of preferred stock are outstanding

as of March 31, 2026, or December 31, 2025.

of Warrants Outstanding

warrants outstanding as of September 30, 2025, are exercisable into 1,238,949 shares of Common Stock which had a fair value of $ 5.02

per share, based on the closing trading price on September 30, 2025.

The aggregate intrinsic value of warrants outstanding as of September

30, 2025, is calculated as the difference between the exercise price of the warrants and the closing market price of the Company’s

Common Stock on that date.

The intrinsic value of warrants outstanding as of September 30, 2025, was zero .

table below lists outstanding warrants for the dates presented, excluding 537,750 pre-funded warrants with an exercise price of $ 0.001

outstanding as of December 31, 2025, which were exercised during the first quarter of 2026, leaving no pre-funded warrants outstanding

as of March 31, 2026.

warrants outstanding as of March 31, 2026, are exercisable into 5,424,598 shares of Common Stock which had a fair value of $ 1.21 per

share based on the closing trading price on March 31, 2026.

The aggregate intrinsic value of warrants outstanding as of March 31, 2026,

is calculated as the difference between the exercise price of the warrants and the closing market price of the Company’s Common

Stock on that date.

The intrinsic value of warrants outstanding as of March 31, 2026, was zero .

of Information of Outstanding Warrants

Quantity of Warrants

Outstanding as of

September 30,

Quantity of Warrants Outstanding as of

March 31, 2026

December 31, 2025

Exercise Price

6 unchanged sentences

May 2024 Series A Common Warrants

May 2024 Series B Common Warrants

May 2024 Placement Agent Warrants

September 2024 PIPE Series A Common Warrants

September 2024 PIPE Series B Common Warrants

September 2024 PIPE Placement Agent Warrants

January 2025 PIPE Warrants

January 2025 Repriced PIPE Warrants

January 2025 PIPE Placement Agent Warrants

March 2025 Warrant Inducement Series A Warrants

March 2025 Warrant Inducement Series B Warrants

March 2025 Warrant Inducement Placement Agent Warrants

March 2025 Warrant Inducement Series A

March 2025 Warrant Inducement Series B

March 2025 Financial Advisor Warrants

December 2025 PIPE Series C Warrants

December 2025 PIPE Series D Warrants

December 2025 PIPE Placement Agent Warrants

Total warrants outstanding

March 2025, the Company entered into the March 2025 Inducement Letter with a Holder who agreed to exercise 483,447

warrants to purchase Common Stock at a reduced exercise price

per share in exchange for 498,080

New Series A Warrants and 468,813

New Series B Warrants with an exercise price of $ 12.84

The March 2025 Inducement Letter, which resulted

in the lowering of the exercise price of the Existing Warrants and the issuance of the New Warrants, is considered a modification of

the Existing Warrants under the guidance ASC 815-40.

The modification is consistent with the equity issuance classification under that

guidance as the reason for the modification was to induce the holders of the Existing Warrants to cash exercise their warrants, which

raised equity capital and generated net proceeds of approximately $ 5.7

As the Existing Warrants and the New Warrants were

classified as equity instruments before and after the exchange, and as the exchange is directly attributable to an equity offering, the

Company recognized the effect of the modification of approximately $ 4.9

million as an equity issuance cost.

May 2024, the Company completed the May 2024 Inducement with the May 2024 Holders who agreed to exercise 51,632 warrants

to purchase Common Stock at a reduced exercise price of $ 51.60 per

share in exchange for 60,117 New

May 2024 Series A Warrants and 43,149 New

May 2024 Series B Warrants with an exercise price of $ 49.10 per

The May 2024 Inducement, which resulted in the lowering of the exercise price of the May 2024 Existing Warrants and the

issuance of the May 2024 New Warrants, is considered a modification of the May 2024 Existing Warrants under the guidance ASC 815-40.

The modification is consistent with the equity issuance classification under that guidance as the reason for the modification was to

induce the holders of the May 2024 Existing Warrants to cash exercise their warrants, which raised equity capital and generated net

proceeds of approximately $ 2.3 million.

As the May 2024 Existing Warrants and the May 2024 New Warrants were classified as equity instruments before and after the exchange,

and as the exchange is directly attributable to an equity offering, the Company recognized the effect of the modification of

approximately $ 1.5 million

as an equity issuance cost.

Placement Agent Warrants

The Company works with H.C.

& Co., LLC (the “Placement Agent”) to act as its investment bank for certain financing transactions.

Per the terms of

the Company’s engagement letter with the Placement Agent, the Placement Agent receives compensation in the form of fees and reimbursed

expenses, as well as the issuance to the Placement Agent, or its designees, warrants to purchase Common Stock of the Company equal to

7.0% of aggregate number of Common Stock issued in a related to the financing at an exercise price equal to 125% of the financing price.

are subject to Shareholder approval.

Expiration date is 5 years from shareholder approval date.

are subject to Shareholder approval.

Expiration date is 24 months from shareholder approval date.

March 2025, the Company entered into the March 2025 Inducement Letter with a Holder who agreed to exercise 483,447 warrants to purchase

Common Stock at a reduced exercise price of $ 12.84 per share in exchange for 498,080 New Series A Warrants and 468,813 New Series B Warrants

with an exercise price of $ 12.84 per share.

The March 2025 Inducement Letter, which resulted in the lowering of the exercise price of

the Existing Warrants and the issuance of the New Warrants, is considered a modification of the Existing Warrants under the guidance

The modification is consistent with the equity issuance classification under that guidance as the reason for the modification

was to induce the holders of the Existing Warrants to cash exercise their warrants, which raised equity capital and generated net proceeds

of approximately $ 5.7 million.

As the Existing Warrants and the New Warrants were classified as equity instruments before and after the

exchange, and as the exchange is directly attributable to an equity offering, the Company recognized the effect of the modification of

approximately $ 4.9 million as an equity issuance cost.

connection with the December 2025 PIPE, the Company and certain holders of the Company’s outstanding warrants that participated

as investors in the January 2025 PIPE, agreed to amend certain outstanding warrants to purchase up to an aggregate of 120,734 shares

of the Company’s common stock that were previously issued on January 23, 2025, with an exercise price of $ 12.70 per share (which

exercise price reflects a 1-for-10 reverse stock split effected by the Company on August 1, 2025), effective upon the closing of the

December 2025 PIPE, such that the amended warrants have a reduced exercise price of $ 2.04 per share.

The amended warrants are exercisable

subject to stockholder approval and will expire five years from the effective date of such stockholder approval.

The Company’s

annual meeting of stockholders is scheduled for May 27, 2026.

The modification of the January 2025 PIPE Warrants was accounted for as

a modification of equity-linked instruments.

In accordance with ASC 815-40, as the warrants were classified as equity instruments before

and after the modification, and as the modification was directly attributable to an equity offering, the Company recognized the effect

of the modification of approximately $ 0.1 million as an equity issuance cost.

Agent Warrants

Company works with Wainwright to act as its investment bank for certain financing transactions.

Per the terms of the Company’s

engagement letter with Wainwright, the Company pays compensation in the form of fees and reimbursed expenses, as well as the issuance

to Wainwright, or its designees, warrants to purchase Common Stock of the Company equal to 7.0% of aggregate number of Common Stock issued

in a related to the financing at an exercise price equal to 125% of the financing price.

Equity Incentive Plan

the Company’s Omnibus Equity Incentive Plan (the “2021 Plan”) as amended, the Company may grant options to purchase

shares of Common Stock, restricted stock awards, performance stock awards, incentive bonus awards, other cash-based awards or directly

issue shares of Common Stock to employees, directors, and consultants of the Company.

At the Company’s 2024 Annual Meeting of Stockholders

held on May 7, 2024, the Company’s stockholders approved an amendment to the Company’s 2021 Plan to increase the number of

shares of Common Stock authorized for issuance thereunder from 4,193 shares to 7,993 shares.

Further at the Company’s 2024 Annual

Meeting of Stockholders, the Company’s stockholders approved an amendment to the Company’s 2021 Plan, to increase the evergreen

provision from one percent to five percent of the total number of the Company’s Common Stock outstanding starting on January 1,

The five percent evergreen provision resulted in an additional 12,588 shares of Common Stock issuable pursuant to the 2021 Plan

as of January 1, 2025.

its 2021 Omnibus Equity Incentive Plan as amended (“2021 Plan”), the Company may grant options to purchase shares of Common

Stock, restricted stock awards, performance stock awards, incentive bonus awards, other cash-based awards or directly issue shares of

Common Stock to our employees, directors, and consultants.

The five percent evergreen provision resulted in an additional 133,005 and

12,588 shares of Common Stock issuable pursuant to the 2021 Plan as of January 1, 2026, and 2025, respectively.

As of March 31, 2026,

the number of shares authorized for issuance under the 2021 Plan was 153,586 .

As of March 31, 2026, there remained 1,018 shares reserved

for issuance under the 2021 Plan, as amended.

awards may be granted at an exercise price per share of not less than 100% of the fair market value at the date of grant.

granted are exercisable over a maximum term of 10 years from the date of grant and generally vest over a period of four years for employees

and one year for directors of the Company’s Board and consultants.

of September 30, 2025, there remain 13 shares reserved for issuance under the 2021 Plan, as amended.

Option Award Activity

summary of the Company’s 2021 Plan stock option activity is as follows:

of Stock Option Activity

Balance at December 31, 2024

Options granted

Options exercised

Options cancelled

Balance at September 30, 2025

Options exercisable at September 30, 2025

January 2024, the Board unanimously approved to provide employees and directors of the Company the opportunity to cancel outstanding,

out-of-the-money, stock options without consideration, in accordance with an option cancellation agreement.

Accordingly, 674 of the 675

stock options outstanding as of December 31, 2023, were cancelled in February 2024.

accordance with accounting guidance provided in ASC 718, since the stock option cancellations were not accompanied by a concurrent grant,

or offer to grant, a replacement award, any unrecognized compensation cost was recognized at the cancellation date.

Accordingly, the

Company recognized stock-based compensation expense of $ 568,372 resulting from the stock option cancellation during the first quarter

aggregate intrinsic value of options outstanding and exercisable as of September 30, 2025, is calculated as the difference between the

exercise price of the underlying options and the closing market price of the Company’s Common Stock on September 30, 2025, which

was $ 5.02 per share.

The intrinsic value of options outstanding and exercisable as of September 30, 2025, was zero.

of September 30, 2025, the total unrecognized compensation cost related to stock options was approximately $ 0.2 million and the weighted

average period over which this cost is expected to be recognized is 2.7 years.

Compensation Expense

general, stock-based compensation is allocated to research and development expense or selling, general and administrative expense according

to the classification of cash compensation paid to the employee, director, or consultant to whom the stock award was granted.

following table summarizes the total stock-based compensation expense related to stock options included in the Company’s statements

of operations:

of Stock Based Compensation Expense

Three Months Ended

September 30,

Nine Months Ended

September 30,

Research and development

Selling, general and administrative

Stock-based compensation expense

and one year for directors of our Board and consultants.

March 9, 2026, the Company appointed a new Vice President of Marketing to help launch the Company’s Tome skincare line.

Upon commencement

of employment, the new employee was provided a non-qualified stock option inducement grant to purchase up to 15,000 shares of the Company’s

Common Stock with an exercise price of $ 1.33 per share based upon the Company’s Nasdaq closing stock price on that day (the “Inducement

The Inducement Award was made outside of the Company’s 2021 Plan, was made in accordance with Nasdaq Listing Rule

5635(c)(4), and was unanimously approved by the Company’s Board of Directors.

The terms and conditions of the Inducement Award

are substantially the same as those awards granted under the Company’s 2021 Plan, including a four-year vesting period.

Value Measurement

19 unchanged sentences

the expected term for certain non-employee awards, on an award-by-award basis.

The Company determines the price volatility based on the historical volatilities of industry peers as it has limited trading

history for its Common Stock price.

Industry peers consist of several public companies in the biotechnology industry with comparable

characteristics, including clinical trials progress and therapeutic indications.

Beginning on January 1, 2026, based on the availability of sufficient historical trading data of the Company’s own common stock,

the Company determines the expected stock volatility based on its historical volatility.

Prior to January 1, 2026, the Company lacked

sufficient historical trading history and, as such, determined volatility based on the historical volatilities of industry peers

that consisted of several public companies with comparable characteristics, including therapeutic indications.

The expected dividend assumption is based on the Company’s current expectations about its anticipated dividend policy.

1 unchanged sentence

yield of zero.

Company granted stock options in January 2025 and 2024.

There were no stock option grants during the second or third quarters of 2025

The following table presents the weighted-average assumptions used for stock options granted during the following periods:

following table presents the weighted-average assumptions used for stock options granted during the following periods:

of Weighted Average Assumptions used for Stock Options

Nine Months Ended

September 30,

Three Months Ended

Grant date fair value

3 unchanged sentences

Expected volatility

Compensation Expense

general, stock-based compensation is allocated to research and development expense or selling, general and administrative expense according

to the classification of cash compensation paid to the employee, director, or consultant to whom the stock award was granted.

The following

table summarizes the total stock-based compensation expense included in the Company’s statements of operations:

of Stock Based Compensation Expense

Three Months Ended

Research and development

Selling, general and administrative

Option Award Activity

summary of the Company’s stock option activity (inclusive of the Inducement Award) is as follows:

of Stock Option Activity

Balance at December 31, 2025

Options granted

Options exercised

Options cancelled

Balance at March 31, 2026

Options exercisable at March 31, 2026

aggregate intrinsic value of options outstanding and exercisable as of March 31, 2026, is calculated as the difference between the exercise

price of the underlying options and the closing market price of the Company’s Common Stock on March 31, 2026, which was $ 1.21 per

The intrinsic value of options outstanding and exercisable as of March 31, 2026, was zero .

of March 31, 2026, total unrecognized compensation cost related to stock options was approximately $ 0.4 million and the weighted average

period over which this cost is expected to be recognized is 3.0 years.

Commitments and Contingencies

March 2025, the Company announced positive topline results for its XYNGARI™ Phase 3 STAR-1 clinical trial.

The total contract amount

with the clinical research organization was approximately $ 7.2 million, which extended from the fourth quarter of 2023 into the second

quarter of 2025.

During the nine months ended September 30, 2025, the Company recognized $ 0.7 million in research and development expense

for the STAR-1 clinical trial.

During the three and nine months ended September 30, 2024, the Company recognized $ 1.8 million and $ 4.2

million, respectively, in research and development expense for the STAR-1 clinical trial.

The STAR-1 clinical trial was completed in the

second quarter of 2025, and no further expenses are expected to be incurred.

a result of Russia’s invasion of Ukraine, the United States has developed coordinated sanctions and export-control measure

packages against Russian individuals and entities.

The Company is currently a party to an exclusive supply agreement for the supply

of the Spongilla raw material used in product candidates.

The counterparty to this supply agreement is a Russian entity.

imposition of enhanced export controls and economic sanctions on transactions with Russia and Russian entities by the United States could prevent the Company from performing under this existing contract or any future

contract it may enter or may prevent the Company from remitting payment for raw material purchased from the Company’s

The Company has received multiple shipments of raw material from its supplier subsequent to the implementation of export

controls and sanctions.

Depending on the extent and breadth of new sanctions, export controls, or tariffs that may be imposed

against Russia, otherwise or as a result of the impact of the war in Ukraine, it is possible that the Company’s ability to

obtain additional supply of the Spongilla raw material could be negatively impacted, which could adversely affect its

business, results of operations, and financial condition.

March 31, 2017, the Company entered into a license agreement, as amended (the “License Agreement”) with Villani, Inc.

(“Villani”) whereby Villani has granted the Company an exclusive, sub-licensable, royalty-bearing license (the

“License”) under the Licensed Patents (as defined in the License Agreement), to formulate, develop, seek regulatory

approval for, make or sell pharmaceutical products that contain Spongilla lacustris (alone or in combination with other

active or inactive ingredients) for the treatment of diseases, disorders and conditions of the skin, including but not limited to

acne, rosacea, psoriasis, atopic dermatitis, seborrheic dermatitis, actinic keratosis and eczema that were developed using certain

licensed know-how (“Licensed Products”).

The Company is responsible for the development (including manufacturing,

packaging, non-clinical studies, clinical trials and obtaining regulatory approval and commercialization (including marketing,

promotion, distribution, etc.)) for all Licensed Products.

The original License Agreement was amended in 2019, and pursuant to the

amended License Agreement, the Company has agreed to make future milestone payments to Villani in an aggregate amount of up to

$ 20.25 million

upon the achievement of specified development and sales milestones, payable in cash or in equity, at the option of Villani, as well

as single-digit royalty payments on net sales.

On July 30, 2021, the Company further amended the License Agreement in the Second

Amendment to the License and Settlement Agreement (the “Second Amendment”).

Pursuant to the Second Amendment, the

Company agreed to make future milestone payments to Villani in an aggregate amount of up to $ 40.5 million

upon the achievement of specified development and sales milestones, payable in cash or in equity, at the option of Villani, as well

as single-digit royalty payments on net sales.

The Second Amendment includes customary terms relating to, among others,

indemnification, intellectual property protection, confidentiality, remedies, and warranties.

As of September 30, 2025, the Company

evaluated the likelihood of the Company achieving the specified milestones and determined that the likelihood is not yet probable

and as such no accrual of these payments is required as of September 30, 2025.

On November 10, 2025, the Company received a notice

of material breach and demand for cure (the “Notice”) from Villani alleging that the Company breached the License

Agreement as a result of the Company’s recent strategic shift to focus on over-the-counter pharmaceutical products.

alleges that the Company (i) failed to use Commercially Reasonable Efforts (as defined in the License Agreement) to pursue a

prescription product business, (ii) failed to provide Villani with advance notice of certain submissions to regulatory authorities,

(iii) used Licensed Know-How (as defined in the License Agreement) outside of the Field (as defined in the License Agreement) and

(iv) the Company’s anticipated OTC kits do not qualify as Licensed Products (as defined in the License Agreement).

November 11, 2025, Villani delivered an additional notice to the Company (the “Additional Notice”) whereby Villani

requested (i) the reversion and assignment of all assets regarding Spongilla -based products back to Villani, (ii) that the

Company preserve all Spongilla inventory, and (iii) the Company preserve all documents, data, and tangible materials related

to Spongilla .

The Company disputes the allegations contained in the Notice and the Additional Notice and is engaged in

discussions with Villani to resolve such disputes.

If the parties are unable to reach a resolution, then either party, pursuant to

the License Agreement, may file for arbitration or termination of the License Agreement.

To date, the License Agreement has not been

terminated and continues in full force.

At this point in time, the Company is unable to predict the final outcome of this

the first quarter of 2025, the Company announced top-line results from a Phase 3 STAR-1 clinical trial of XYNGARI™, formerly its

lead prescription candidate for the treatment of moderate-to-severe acne.

The total contract amount with the clinical research organization

was approximately $ 7.0 million, and the contract extended from the fourth quarter of 2023 to the first half of 2025.

During the quarter

ended March 31, 2025, the Company recognized $ 0.7 million in research and development expense related to the clinical research organization

for the STAR-1 trial.

No additional expense was incurred during the quarter ended March 31, 2026.

February 27, 2020, the Company entered into an exclusive Supply Agreement (“Supplier Agreement”) with Reka-Farm, LLC (“Reka-Farm”),

whereby Reka-Farm will supply the Company with the Spongilla raw materials necessary for use in the development of our products.

The Supplier Agreement has an indefinite term unless and until terminated.

The Supplier Agreement may be terminated (i) by either party

for material breach with 90 days written notice, if such material breach is not cured within such notice period and (ii) by the Company

for any reason or no reason upon 90 days written notice to Reka-Farm.

For the term of the Supplier Agreement, Reka-Farm is prohibited

from supplying Spongilla for development and sale of any other product outside of the Russian Federation, other than Cosmetic

Products (as defined in the Supplier Agreement).

Pursuant to the Supplier Agreement, the Company pays a pre-negotiated price per kilogram

for Spongilla supplied by Reka-Farm, and the Company is required to pay to Reka-Farm a royalty payment of less than one percent

of the Net Sales (as defined in the Supplier Agreement) of any products we develop containing Spongilla raw material supplied

by Reka-Farm.

a result of Russia’s invasion of Ukraine, the United States, the United Kingdom, and the European Union governments, among others,

have developed coordinated sanctions and export-control measure packages against Russian individuals and entities.

The Company is currently

a party to an exclusive Supplier Agreement for the supply of the Spongilla raw material used in the Company’s Tome skincare

The counterparty to this supply agreement, Reka-Farm, is a Russian entity.

The imposition of enhanced export controls and economic

sanctions on transactions with Russia and Russian entities by the United States, the United Kingdom, and/or the European Union could

prevent the Company from performing under this existing contract or any future contract it may enter or may prevent the Company from

remitting payment for raw material purchased from the Company’s supplier.

The Company has recently received a shipment of raw material

from its supplier after the implementation of export controls and sanctions, containing additional quantities of Spongilla raw

material, which the Company believes will provide the Company with sufficient quantities of Spongilla to support the planned launch

and sale of the Tome skincare products, based on current assumptions.

The Company plans to order additional shipments of raw materials

to support the commercial sales of its products, the timing of which is unknown.

Depending on the extent and breadth of new sanctions

or export controls that may be imposed against Russia, otherwise or as a result of the impact of the war in Ukraine, it is possible that

the Company’s ability to obtain additional supply of the Spongilla raw material used in Tome skincare could be negatively

impacted, which could adversely affect its business, results of operations, and financial condition.

is the sole supplier of the Company’s Spongilla raw materials used in its skincare products.

The Company has evaluated other

suppliers of Spongilla from other regions of the world;

however, no other supplier nor their Spongilla supply has met the

quality standards set forth by the Company’s cGMP practices.

An alternative source to supply Spongilla raw materials could

be the aquaculture of Spongilla in a lab setting, which could significantly increase the cost of raw materials as well as the

availability of raw materials due to the cost and time to develop and build an aquaculture infrastructure to supply Spongilla

in commercial quantities.

If Reka-Farm is unavailable to supply Spongilla raw materials to the Company, it could adversely affect

its business, results of operations, and financial condition.

Collaboration

2 unchanged sentences

(“Revance”), pursuant to which the Company and Revance intend to conduct a multi-center clinical

trial (the “Trial”) to evaluate the topical application of XYNGARI TM , the Company’s topical Spongilla powder

(formerly referred to as DMT310), with DAXXIFY® (daxibotulinumtoxinA-lanm), Revance’s botulinum toxin type A.

Pursuant to the terms

of the Clinical Trial Agreement, Revance has granted the Company a non-exclusive, worldwide, non-transferable, royalty-free license,

with a right to sublicense (subject to limitations), to use certain Revance intellectual property, solely as necessary or useful for

the Company to conduct the trial under the Clinical Trial Agreement.

The Company has granted Revance a similar license to use XYNGARI TM

and other compound(s) under the Clinical Trial Agreement.

The Clinical Trial Agreement will terminate upon completion of the Trial,

the delivery of the data resulting from the Trial and the completion of any statistical analyses of the data resulting from the Trial.

Either party may terminate the Clinical Trial Agreement upon a material breach by the other party that remains uncured following 30 days

after the date of written notice of such breach.

In addition, either party may terminate the Clinical Trial Agreement immediately upon

written notice if such party reasonably deems it necessary in order to protect the safety, health or welfare of subjects enrolled in

The Company has agreed to sponsor, conduct, and fund the Phase 2a clinical trial;

however, no activities have been initiated

by either party.

As of September 30, 2025, the Company has not incurred any expenses related to the Revance Clinical Trial Agreement.

Rights Agreement

connection with the January 2025 PIPE (see Note 4), the Company entered into a Registration Rights Agreement with the purchasers, dated

as of January 21, 2025 (the “Registration Rights Agreement”).

The Registration Rights Agreement provides that the Company

shall file a registration statement covering the resale of all the registrable securities (as defined in the Registration Rights Agreement)

with the SEC.

The registration statement on Form S-3 required under the Registration Rights Agreement was filed with the SEC on January

30, 2025, and became effective on February 5, 2025.

the occurrence of any Event (as defined in the Registration Rights Agreement), which, among others, prohibits the purchasers from reselling

the securities for more than ten consecutive calendar days or more than an aggregate of fifteen calendar days during any 12-month period,

and should the registration statement cease to remain continuously effective, the Company would be obligated to pay to each purchaser,

on each monthly anniversary of each such Event, an amount in cash, as partial liquidated damages and not as a penalty, equal to the product

of 2.0% multiplied by the aggregate subscription amount paid by such purchaser in the Private Placement, up to a maximum of 12% of the

aggregate subscription amount.

As of September 30, 2025, the Company determined that the likelihood of the Company incurring liquidated

damages pursuant to the Registration Rights Agreement is remote, and as such, no accrual of these payments is required as of September

the normal course of business, the Company may be involved in legal proceedings or threatened legal proceedings.

The Company is not a

party to any legal proceedings or aware of any threatened legal proceedings which are expected to have a material adverse effect on its

financial condition, results of operations or liquidity.

trial (the “Trial”) to evaluate the topical application of Dermata Compound, the Company’s topical Spongilla powder

(formerly referred to as DMT310 or XYNGARI), with Daxxify (daxibotulinumtoxinA-lanm), Revance’s botulinum toxin type A.

to the terms of the Clinical Trial Agreement, Revance has granted the Company a non-exclusive, worldwide, non-transferable, royalty-free

license, with a right to sublicense (subject to limitations), to use certain Revance intellectual property, solely as necessary or useful

for the Company to conduct the trial under the Clinical Trial Agreement.

The Company has granted Revance a similar license to use Dermata

Compound and other compound(s) under the Clinical Trial Agreement.

The Clinical Trial Agreement will terminate upon completion of the

Trial, the delivery of the data resulting from the Trial and the completion of any statistical analyses of the data resulting from the

Either party may terminate the Clinical Trial Agreement upon a material breach by the other party that remains uncured following

30 days after the date of written notice of such breach.

In addition, either party may terminate the Clinical Trial Agreement immediately

upon written notice if such party reasonably deems it necessary in order to protect the safety, health or welfare of subjects enrolled

in the Trial.

The Company has agreed to sponsor, conduct, and fund the Phase 2a clinical trial, but no financial obligations or consideration

is contemplated in the Clinical Trial Agreement, and the Company has placed the Phase 2a clinical trial on hold at this time.

March 31, 2017, the Company entered into a license agreement, as amended (the “License Agreement”) with Villani, Inc.

whereby Villani granted the Company an exclusive, sub-licensable, royalty-bearing license (the “License”) under the Licensed

Patents (as defined in the License Agreement), to formulate, develop, seek regulatory approval for, make or sell products that contained

Spongilla lacustris (alone or in combination with other active or inactive ingredients) for the treatment of diseases, disorders

and conditions of the skin, including but not limited to acne, rosacea, psoriasis, atopic dermatitis, seborrheic dermatitis, actinic

keratosis and eczema that were developed using certain licensed know-how (“Licensed Products”).

The Company was responsible

for the development (including manufacturing, packaging, non-clinical studies, clinical trials and obtaining regulatory approval and

commercialization (including marketing, promotion, distribution, etc.)) for all Licensed Products.

The original License Agreement was

amended in 2019, and pursuant to the amended License Agreement, the Company was required to make future milestone payments to Villani

in an aggregate amount of up to $ 20.25 million upon the achievement of specified development and sales milestones, payable in cash or

in equity, at the option of Villani, as well as single-digit royalty payments on net sales.

On July 30, 2021, the Company further amended

the License Agreement in the Second Amendment to the License and Settlement Agreement (the “Second Amendment”).

to the Second Amendment, the Company was required to make future milestone payments to Villani in an aggregate amount of up to $ 40.5

million upon the achievement of specified development and sales milestones, payable in cash or in equity, at the option of Villani, as

well as single-digit royalty payments on net sales.

The Second Amendment includes customary terms relating to, among others, indemnification,

intellectual property protection, confidentiality, remedies, and warranties.

November 10, 2025, the Company received a notice of material breach and demand for cure (the “Notice”) from Villani alleging

that the Company breached the License Agreement as a result of the Company’s recent strategic shift to focus on DTC skincare products.

The Notice alleged that the Company (i) failed to use Commercially Reasonable Efforts (as defined in the License Agreement) to pursue

a prescription product business, (ii) failed to provide Villani with advance notice of certain submissions to regulatory authorities,

(iii) used Licensed Know-How (as defined in the License Agreement) outside of the Field (as defined in the License Agreement) and (iv)

the Company’s anticipated OTC kits did not qualify as Licensed Products (as defined in the License Agreement).

On November 11,

2025, Villani delivered an additional notice to the Company (the “Additional Notice”) whereby Villani requested (i) the reversion

and assignment of all assets regarding Spongilla -based products back to Villani, (ii) that the Company preserve all Spongilla

inventory, and (iii) the Company preserve all documents, data, and tangible materials related to Spongilla .

The Company disputes

the allegations contained in the Notice and the Additional Notice.

As part of the Company’s strategic pivot in September 2025,

on November 17, 2025, the Company provided notice to terminate the License Agreement with an effective date of February 15, 2026.

of March 31, 2026, the Company has not accrued any payments related to the Villani Notices since the Company does not believe any financial

payments are probable and all obligations under the termination of the License Agreement have been fulfilled.

The termination of the

License Agreement was effective February 15, 2026 and the Company believes it has fulfilled its obligations under the termination provisions

of the License Agreement.

See related additional disclosures under Legal Proceedings disclosure below.

April 23, 2026, Dermata was served with a complaint filed by Villani, Inc.

(“Villani”) in the U.S.

District Court for

the Central District of California (“Lawsuit”).

The Lawsuit alleges the Company made false or misleading advertising statements

under the Lanham Act 15 USC §1125, breach of contract, and conversion, and seeks injunctive relief.

In connection with the Lawsuit,

on April 26, 2026, Villani filed a motion seeking a temporary restraining order (“TRO”) and a preliminary injunction.

Company denies the allegations in the Lawsuit and is vigorously opposing Villani’s motion.

May 6, 2026, the court denied the TRO in part as related to Villani’s breach of contract and conversion claims, and granted the

TRO in part as related to certain of Villani’s false or misleading advertising claims, which imposes certain temporary restrictions

on specific statements the Company can make, pending further proceedings.

The preliminary injunction, if granted, could extend certain

of the above restrictions.

A hearing on the preliminary injunction is scheduled for July 14, 2026.

this time, the Company is unable to reasonably estimate the likelihood of an unfavorable outcome or the amount or range of potential

loss, if any, that may result from this matter.

The TRO and any potential preliminary injunction could have an adverse impact on the

Company’s operations, financial condition, and results of operations, particularly if the restrictions remain in place for an extended

period or are expanded in scope.

Company will continue to monitor developments in this matter and will adjust its disclosures as appropriate.

Rights Agreements

connection with the January 2025 Private Placement, the Company entered into a registration rights agreement with the purchasers, dated

as of January 21, 2025, (the “January 2025 Registration Rights Agreement”).

The January 2025 Registration Rights Agreement

provided that the Company shall file a registration statement covering the resale of all of the registrable securities with the SEC.

The registration statement on Form S-3 required under the Registration Rights Agreement was filed with the SEC on January 30, 2025, and

became effective on February 5, 2025.

connection with the December 2025 Private Placement, the Company entered into a registration rights agreement with the purchasers, dated

as of December 23, 2025, (the “December 2025 Registration Rights Agreement”).

The December 2025 Registration Rights Agreement

provided that the Company shall file a registration statement covering the resale of all of the registrable securities with the SEC.

The registration statement on Form S-3 required under the December 2025 Registration Rights Agreement was filed with the SEC on January

22, 2026, and became effective on January 29, 2026.

the occurrence of any Event as defined in the January 2025 Registration Rights Agreement and the December 2025 Registration Rights Agreement,

which, among others, prohibits the purchasers from reselling the securities for more than ten consecutive calendar days or more than

an aggregate of fifteen calendar days during any 12-month period, and should the registration statement cease to remain continuously

effective, the Company would be obligated to pay to each purchaser, on each monthly anniversary of each such Event, an amount in cash,

as partial liquidated damages and not as a penalty, equal to the product of 2.0% multiplied by the aggregate subscription amount paid

by such purchaser in the Private Placement, up to a maximum of 12% of the aggregate subscription amount.

As of March 31, 2026, the Company

determined that the likelihood of the Company incurring a significant amount of liquidated damages pursuant to the Registration Rights

Agreements is remote.

Segment Information

3 unchanged sentences

Company’s chief operating decision maker view the Company’s operations and manage its business in one operating segment,

which is the business of identifying, developing, and commercializing pharmaceutical products for the treatment of medical and aesthetic

skin conditions and diseases.

which is the business of developing, branding, marketing, and commercializing direct to consumer skincare products.

CODM, who is the Chief Executive Officer (“CEO”), President, and Chairman of the Board, manages and allocates resources to

2 unchanged sentences

allocating resources on an entity-wide basis enables the CEO to assess the overall level of resources available and how to best deploy

these resources across functions and research and development projects that are in line with the Company’s long-term company-wide

strategic goals.

Consistent with this decision-making process, the CEO uses financial information for purposes of evaluating performance,

forecasting future period financial results, allocating resources, and setting incentive targets.

Operating expenses are used to monitor

budget versus actual results.

The CODM does not review assets in evaluating the results of the Company, and therefore, such information

is not presented.

the Company’s September 2025 strategic pivot to prioritize the development and distribution of OTC products, the segment information

disclosure has been recast for all periods presented to reflect this change.

The following table summarizes the segment’s financial

information including the Company’s significant segment expenses:

these resources across functions that are in line with the Company’s long-term company-wide strategic goals.

Consistent with this

decision-making process, the CEO uses financial information for purposes of evaluating performance, forecasting future period financial

results, allocating resources, and setting incentive targets.

Operating expenses are used to monitor budget versus actual results.

CODM does not review assets in evaluating the results of the Company, and therefore, such information is not presented.

the Company’s September 2025 strategic pivot to prioritize the development and distribution of Tome skincare products, the segment

information disclosure has been recast for all periods presented to reflect this change.

The following table summarizes the segment’s financial information including the Company’s

significant segment expenses:

of Segment Financial Information

Three Months Ended

September 30,

Nine Months Ended

September 30,

Research and development

Chemistry, manufacturing and controls

Chemistry, manufacturing and controls and nonclinical

Personnel related

1 unchanged sentence

Selling, general and administrative

Public company compliance

Personnel related

3 unchanged sentences

$ ( 2,303,587 )

$ ( 5,696,669 )

$ ( 9,136,523 )

Related Party Transactions

1 unchanged sentence

an agency that assists the Company in branding, marketing, and product design for the Company’s first product launch, expected

The founding partner of Wilder is the CEO’s son-in-law and as such, falls in accordance with the Company’s Policy

and Procedures for Related Party Transactions.

Accordingly, the Board of Directors, inclusive of the Audit Committee, considered, reviewed,

and unanimously approved the retention of Wilder as the branding agency, authorizing management to negotiate and execute an agreement

on terms substantially consistent with the proposal reviewed.

For the three and nine months ended September 30, 2025, the Company incurred

approximately $ 0.5 million of marketing expenses related to Wilder, of which approximately $ 0.2 million was outstanding and included

in accounts payable and other accrued expenses as of September 30, 2025.

connection with the January 2025 PIPE financing, certain Company insiders, including the Company’s CEO, Chief Financial

Officer and certain members of the Company’s board of directors, participated in the offering.

These Company insiders

purchased an aggregate of 122,047

shares of Common Stock and Warrants to purchase up to an aggregate of 122,047

shares of Common Stock, for an aggregate purchase price of $ 1.55

The purchase price per share and accompanying Warrant for these Company insiders was the same as paid by other investors in

the January 2025 PIPE.

Subsequent Event

to September 30, 2025, at the Holder’s request, the Company delivered the remaining balance of 182,000 shares of Common Stock which

were held in abeyance related to the March 2025 Warrant Inducement.

Accordingly, no further shares are held in abeyance.

The founding partner of Wilder is the Company CEO’s son-in-law and as such, falls within accordance with the Company’s

Policy and Procedures for Related Party Transactions.

Accordingly, the Board of Directors, inclusive of the Audit Committee, considered,

reviewed, and unanimously approved the retention of Wilder as the branding agency, authorizing management to negotiate and execute an

agreement on terms substantially consistent with the proposal reviewed.

For the quarter ended March 31, 2026, the Company incurred approximately

$ 0.2 million of marketing expenses related to Wilder, of which approximately $ 0.1 million was outstanding and included in accrued and

other current liabilities as of March 31, 2026.

connection with the January 2025 PIPE financing, certain Company insiders, including the Company’s CEO, Chief Financial Officer

and certain members of the Company’s board of directors, participated in the offering.

These Company insiders purchased an aggregate

of 122,047 shares of Common Stock and Warrants to purchase up to an aggregate of 122,047 shares of Common Stock, for an aggregate purchase

price of $ 1.55 million.

The purchase price per share and accompanying Warrant for these Company insiders was the same as paid by other

investors in the January 2025 PIPE.

See Note 4 – Equity Securities.

connection with the December 2025 PIPE financing, certain Company insiders, including the Company’s CEO, Chief Financial Officer

and certain members of the Company’s management, participated in the offering.

These Company insiders purchased an aggregate of

735,294 shares of Common Stock and Warrants to purchase up to an aggregate of 1,470,588 shares of Common Stock, for an aggregate purchase

price of $ 1.5 million.

The purchase price per share and accompanying Warrant for these Company insiders was the same as paid by other

investors in the December 2025 PIPE.

In addition, in connection with the December 2025 PIPE, the Company and certain holders of the Company’s

outstanding warrants who participated as investors in the January 2025 PIPE, including certain Company insiders, agreed to amend certain

outstanding warrants to purchase up to an aggregate of 120,734 shares of the Company’s common stock that were previously issued

on January 23, 2025, with an exercise price of $ 12.70 per share (which exercise price reflects a one-for-10 reverse stock split effected

by the Company on August 1, 2025), effective upon the closing of the December 2025 PIPE, such that the amended warrants have a reduced

exercise price of $ 2.04 per share, which was the same exercise price as what other investors received in the December 2025 PIPE.

amended warrants are exercisable subject to stockholder approval and will expire five years from the effective date of such stockholder

See Note 4 – Equity Securities.

Subsequent Events

Note 6 above for discussion related to legal proceedings.

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

What changed 10-Q

Item 1. Financial Statements