What changed in this filing

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Item 1. Financial Statements

2024-08-08 compared with 2024-05-09 · 430 added, 1388 removed, 485 unchanged (79% of the section changed)

FINANCIAL STATEMENTS

LIPOCINE INC.

AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

Consolidated Balance Sheets

Current assets:

Cash and cash equivalents

Cash and cash

Marketable investment securities

Accrued interest income

Prepaid and other current assets

and other current assets

Total current assets

Property and equipment, net of accumulated depreciation of $ 1,190,703 and $ 1,182,191 respectively

Property and equipment, net of accumulated depreciation of $ 1,199,215

and $ 1,182,191 respectively

Liabilities and Stockholders’ Equity

2 unchanged sentences

Accrued expenses

Warrant liability

Total current liabilities

Total liabilities

Commitments and contingencies (notes 7, 8, 9 and 10)

current liabilities

Commitments and contingencies (notes 7, 8,

Stockholders’ equity:

Common stock, par value $ 0.0001 per share, 200,000,000 shares authorized;

5,316,166 issued and 5,315,830 outstanding

Common stock, par value $ 0.0001 per share,

200,000,000 shares authorized;

5,348,276 and 5,316,166 issued, and 5,347,940 and 5,315,830 outstanding, respectively outstanding

Additional paid-in capital

Treasury stock at cost, 336 shares

Accumulated other comprehensive gain (loss)

Accumulated deficit

Treasury stock at cost,

Accumulated other comprehensive

( 199,332,227 )

( 199,777,214 )

Total stockholders’ equity

Total liabilities and stockholders’ equity

stockholders’ equity

liabilities and stockholders’ equity

accompanying notes to condensed consolidated financial statements

LIPOCINE INC.

AND SUBSIDIARIES

Consolidated Statements of Operations and Comprehensive Income (Loss)

Three Months Ended March 31,

Consolidated Statements of Operations and Comprehensive Loss

Months Ended June 30,

License revenue

Royalty revenue

Total revenues

Operating expenses:

Research and development

General and administrative

Total operating expenses

Operating income (loss)

and administrative

operating expenses

( 3,292,568 )

( 3,955,605 )

( 8,294,239 )

Other income (expense):

Interest and investment income

Unrealized gain (loss) on warrant liability

Total other income, net

Income (loss) before income tax expense

Interest and investment

gain (loss) on warrant liability

other income, net

Income (loss) before income

( 3,068,153 )

( 3,548,629 )

( 7,418,659 )

Income tax expense

1 unchanged sentence

( 3,068,634 )

Issuance of Series B preferred stock dividend

Net income (loss) attributable to common shareholders

( 3,548,629 )

Basic income (loss) per share attributable to common stock

Weighted average common shares outstanding, basic

Diluted income (loss) per share attributable to common stock

Weighted average common shares outstanding, diluted

Comprehensive loss:

Net income (loss)

( 7,418,859 )

Net unrealized gain (loss) on marketable investment securities

of Series B preferred stock dividend

income (loss) attributable to common shareholders

$ ( 3,068,634 )

$ ( 3,548,629 )

$ ( 7,418,948 )

Basic earnings (loss)

per share attributable to common stock

Weighted average common shares outstanding,

Diluted earnings (loss)

per share attributable to common stock

Weighted average common shares outstanding,

Comprehensive income (loss):

Net income (loss)

$ ( 3,068,634 )

See accompanying notes to condensed consolidated financial statements

LIPOCINE INC.

$ ( 3,548,629 )

$ ( 7,418,859 )

unrealized gain (loss) on marketable investment securities

Comprehensive

income (loss)

$ ( 3,067,749 )

$ ( 3,567,682 )

$ ( 7,414,350 )

accompanying notes to condensed consolidated financial statements

AND SUBSIDIARIES

Condensed Consolidated Statements of Changes in Stockholders’ Equity

For the Three Months Ended March 31, 2024 and 2023

Mezzanine Equity

Stockholder’s Equity

Series B Preferred Stock

Treasury Stock

Accumulated Other

Number of Shares

Paid-In Capital

Comprehensive Gain (Loss)

Accumulated Deficit

Stockholders’ Equity

Balances at December 31, 2022

Consolidated Statements of Changes in Stockholders’ Equity

the Three and Six Months Ended June 30, 2024 and 2023

Comprehensive

Stockholders’

Stockholder’s

Comprehensive

Stockholders’

at March 31, 2023

( 187,295,362 )

1 unchanged sentence

( 3,548,629 )

net loss on marketable investment securities

of Series B preferred stock

associated with ATM Offering

at June 30, 2023

$ 219,443,674

Unrealized net gain on marketable investment securities

Stock-based compensation

Issuance of Series B preferred stock dividend

Redemption of Series B preferred stock

Option exercises

Costs associated with ATM Offering

Balances at March 31, 2023

$ ( 190,843,991 )

Comprehensive

Stockholders’

at December 31, 2022

$ 219,112,164

Mezzanine Equity

Stockholder’s Equity

Series B Preferred Stock

Treasury Stock

Accumulated Other

Number of Shares

Paid-In Capital

Comprehensive Gain (Loss)

Accumulated Deficit

Stockholders’ Equity

Balances at December 31, 2023

$ ( 183,425,043 )

1 unchanged sentence

( 7,418,859 )

net gain on marketable investment securities

of Series B preferred stock

stock sold through ATM offering

at June 30, 2023

$ 219,443,674

Net income (loss)

Unrealized net loss on marketable investment securities

Stock-based compensation

Costs associated with ATM Offering

Balances at March 31, 2024

$ ( 190,843,991 )

Stockholder’s

Comprehensive

Stockholders’

at March 31, 2024

( 196,263,593 )

1 unchanged sentence

( 3,068,634 )

net gain on marketable investment securities

stock sold through ATM Offering

at June 30, 2024

$ 220,582,158

$ ( 199,332,227 )

Stockholder’s

Comprehensive

Stockholders’

at December 31, 2023

$ 220,171,250

$ ( 199,777,214 )

$ 220,171,250

$ ( 199,777,214 )

income (loss)

net loss on marketable investment securities

stock sold through ATM offering

at June 30, 2024

$ 220,582,158

$ ( 199,332,227 )

$ 220,582,158

$ ( 199,332,227 )

accompanying notes to condensed consolidated financial statements

LIPOCINE INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

Three Months Ended March 31,

Consolidated Statements of Cash Flows

Months Ended June 30,

Cash flows from operating activities:

Net income (loss)

$ ( 7,418,859 )

Adjustments to reconcile net income (loss) to cash provided by (used in)operating activities:

Adjustments to reconcile

net income (loss) to cash used in operating activities:

Depreciation expense

Stock-based compensation expense

Non-cash loss (gain) on change in fair value of warrant liability

Amortization of discounts on marketable investment securities

Changes in operating assets and liabilities:

Stock-based compensation

Non-cash loss (gain) on

change in fair value of warrant liability

Amortization of discounts

on marketable investment securities

Changes in operating assets

and liabilities:

Accrued interest income

Prepaid and other current assets

Prepaid and other current

Accounts payable

Accrued expenses

Cash provided by (used in) operating activities

used in operating activities

( 7,237,654 )

Cash flows from investing activities:

Purchase of property and equipment

Purchases of marketable investment securities

( 10,789,840 )

Purchase of property and

Purchases of marketable

investment securities

( 17,537,469 )

Maturities of marketable investment securities

Net cash provided by (used in) investing activities

( 8,780,931 )

Maturities of marketable

investment securities

cash provided by investing activities

Cash flows from financing activities:

Costs associated with ATM Offering

Cash used in financing activities

Net increase in cash and cash equivalents

( 1,690,421 )

Cash and cash equivalents at beginning of period

Cash and cash equivalents at end of period

Supplemental disclosure of cash flow information:

proceeds from sale of common stock through ATM

provided by (used in) financing activities

Net increase in cash and

cash equivalents

Cash and cash equivalents

at beginning of period

Cash and cash equivalents

at end of period

Supplemental disclosure

of cash flow information:

Income taxes paid

Supplemental disclosure of non-cash investing and financing activity:

Net unrealized gain (loss) on available-for-sale securities

Issuance of Series B preferred stock

Supplemental disclosure

of non-cash investing and financing activities:

Net unrealized gain (loss)

on available-for-sale securities

Issuance of Series B preferred

accompanying notes to condensed consolidated financial statements

12 unchanged sentences

in accordance with rules and regulations of the SEC.

Operating results for the three months ended March 31, 2024 are not necessarily

Operating results for the three and six months ended June 30, 2024 are not necessarily

indicative of the results that may be expected for any future period or for the year ending December 31, 2024.

6 unchanged sentences

Company believes that its existing capital resources, together with interest thereon, will be sufficient to meet its projected operating

requirements through at least May 9, 2025.

The Company has based this estimate on assumptions that may prove to be wrong, and the Company

could utilize its available capital resources sooner than it currently expects.

While the Company believes it has sufficient liquidity

and capital resources to fund our projected operating requirements through at least May 9, 2025, the Company will need to raise additional

capital at some point through the equity or debt markets or via out-licensing activities to support its operations.

If the Company is

unsuccessful in raising additional capital, its ability to continue as a going concern will become a risk.

Further, the Company’s

operating plan may change, and the Company may need additional funds to meet operational needs and capital requirements for product development,

regulatory compliance and clinical trial activities sooner than planned.

In addition, the Company’s capital resources may be consumed

more rapidly if it pursues additional clinical studies for LPCN 1154, LPCN 2101, LPCN 2203, LPCN 2401, LPCN 1148, LPCN 1144, and or LPCN

Conversely, the Company’s capital resources could last longer if the Company reduces expenses, reduces the number of activities

currently contemplated under its operating plan, or terminates, modifies the design of or suspends on-going clinical studies.

January 12, 2024, the Company entered into a License Agreement (the “License Agreement”) with Gordon Silver Limited (“GSL”)

and Verity Pharmaceuticals, Inc.

(“Verity Pharma”), pursuant to which the Company granted to GSL (an affiliate of Verity

Pharma) an exclusive, royalty-bearing, sublicensable right and license to commercialize the Company’s TLANDO® product with

respect to testosterone replacement therapy in males for conditions associated with a deficiency or absence of endogenous testosterone,

as indicated in NDA No.

208088, treatment of Klinefelter syndrome, and pediatric indications relating to testosterone replacement therapy

in males for conditions associated with a deficiency or absence of endogenous testosterone (the “Field”), in each case within

the United States and Canada.

The License Agreement also provides GSL with a license to develop and commercialize TLANDO XR, the Company’s

potential once-daily oral product candidate for testosterone replacement therapy.

The Company retains development and commercialization

rights for TLANDO and TLANDO XR outside of the United States and Canada, and with respect to applications outside of the Field inside

or outside the United States and Canada.

execution of the License Agreement, GSL agreed to pay the Company a license fee of $ 11.0 million with an initial payment of $ 2.5 million

which was received on signing of the License Agreement, $ 5.0 million which was received on February 1, 2024, $ 2.5 million to be paid

no later than January 1, 2025, and $ 1.0 million to be paid no later than January 1, 2026.

The Company is also eligible to receive development

and sales milestone payments of up to $ 259 million in the aggregate, depending primarily on the achievement of certain sales milestones

in a single calendar year with respect to all products licensed by GSL under the License Agreement.

In addition, the Company is eligible

to receive tiered royalty payments at rates ranging from 12 % up to 18 % of net sales of licensed products in the United States and Canada.

requirements through at least August 8, 2025.

The Company has based this estimate on assumptions that may prove to be wrong, and the

Company could utilize its available capital resources sooner than it currently expects.

While the Company believes it has sufficient

liquidity and capital resources to fund our projected operating requirements through at least August 8, 2025, the Company will need to

raise additional capital through the equity or debt markets or via out-licensing activities to support its operations.

If the Company is unsuccessful in raising additional capital, its ability to continue as a going concern will become a risk.

the Company’s operating plan may change, and the Company may need additional funds to meet operational needs and capital requirements

for product development, regulatory compliance and clinical trial activities sooner than planned.

In addition, the Company’s capital

resources may be consumed more rapidly if it pursues additional clinical studies for LPCN 1154, LPCN 2101, LPCN 2203, LPCN 2401, LPCN

1148, LPCN 1144, and or LPCN 1107.

Conversely, the Company’s capital resources could last longer if the Company reduces expenses,

reduces the number of activities currently contemplated under its operating plan, or terminates, modifies the design of or suspends on-going

clinical studies.

January 12, 2024, the Company entered into a License Agreement (the “Verity License Agreement”) with Gordon Silver

Limited (“GSL”) and Verity Pharmaceuticals, Inc.

(“Verity Pharma”), pursuant to which the Company granted to

GSL (an affiliate of Verity Pharma) an exclusive, royalty-bearing, sublicensable right and license to commercialize the

Company’s TLANDO® product with respect to testosterone replacement therapy in males for conditions associated with a

deficiency or absence of endogenous testosterone, as indicated in a New Drug Application (“NDA”) No.

208088, treatment

of Klinefelter syndrome, and pediatric indications relating to testosterone replacement therapy in males for conditions associated

with a deficiency or absence of endogenous testosterone (the “Field”), in each case within the United States and Canada.

The Verity License Agreement also provides GSL with a license to develop and commercialize TLANDO XR, the Company’s potential

once-daily oral product candidate for testosterone replacement therapy.

The Company retains development and commercialization rights

for TLANDO and TLANDO XR (LPCN 1111) outside of the United States and Canada, and with respect to applications outside of the Field

inside or outside the United States and Canada.

execution of the Verity License Agreement, GSL agreed to pay the Company a license fee of $ 11.0

million with an initial payment of $ 2.5

million which was received on signing of the Verity License Agreement, $ 5.0

million which was received on February 1, 2024, $ 2.5

million to be paid no later than January 1, 2025, and $ 1.0

million to be paid no later than January 1, 2026.

The Company is also eligible to receive development and sales milestone payments

of up to $ 259

million in the aggregate, depending primarily on the achievement of certain sales milestones in a single calendar year with respect

to all products licensed by GSL under the Verity License Agreement.

In addition, the Company is eligible to receive tiered royalty

payments at rates ranging from 12 %

of net sales of licensed products in the United States and Canada.

May 10, 2023, the Company’s Board approved a reverse stock split ratio of 1-for-17 .

18 unchanged sentences

such changes become known.

Note 7 for a description of the license agreement (“Verity License Agreement”) with Verity Pharma, Inc.

See Note 7 for a description of the Verity License Agreement.

See Note 11 for a description of the agreement with Spriaso, a related party.

21 unchanged sentences

Concentration

major partner is considered to be one that comprises more than 10 % of the Company’s total revenues.

For the three months ended

March 31, 2024, the Company recognized licensing revenue of $ 7.5 million and royalty revenue of $ 51,000 relating to the Verity License

The revenue recognized in 2024 was 99 % from one major customer, Verity.

License revenue recognized in the three months ended

March 31, 2023 of $ 55,000 , was 100 % from a related-party, Spriaso.

major partner is considered to be one that comprises more than 10 %

of the Company’s total revenues.

For the three months ended June 30, 2024, the Company recognized royalty revenue of

approximately $ 90,000

relating to the Verity License Agreement.

For the six months ended June 30, 2024, the Company recognized licensing revenue of $ 7.5

million and royalty revenue of approximately $ 140,000

relating to the Verity License Agreement.

The revenue recognized in 2024 was 99 %

from one major customer, Verity Pharma.

revenue recognized in the three months ended June 30, 2023.

License revenue recognized in the six months ended June 30, 2023 of

from a related-party, Spriaso.

(3) Earnings (Loss) per Share

4 unchanged sentences

warrants and unvested restricted stock units to the extent such shares are dilutive.

following table sets forth the computation of basic and diluted earnings (loss) per share of common stock for the three months ended

March 31, 2024 and 2023:

following table sets forth the computation of basic and diluted earnings (loss) per share of common stock for the three and six months

ended June 30, 2024 and 2023:

Schedule of Computation of Basic and Diluted Earnings (Loss) Per Share of Common Stock

Three Months Ended March 31,

Basic earnings (loss) per share attributable to common stock:

Net earnings (loss)

Months Ended June 30,

Basic earnings (loss) per

share attributable to common stock:

income (loss)

$ ( 3,068,634 )

$ ( 3,548,629 )

$ ( 7,418,948 )

Weighted avg.

common shares outstanding

Basic earnings (loss) per share attributable to common stock

Diluted earnings (loss) per share attributable to common stock:

Net earnings (loss)

shares outstanding

Basic earnings (loss)

per share attributable to common stock

Diluted earnings (loss)

per share attributable to common stock:

Net income (loss)

$ ( 3,068,634 )

Effect of dilutive securities on net earnings (loss):

Common stock warrants

Total net earnings (loss) for purpose of calculating diluted net earnings (loss)

per common share

$ ( 3,548,629 )

$ ( 7,418,948 )

Effect of dilutive securities

on net income (loss):

stock warrants

Total net earnings

(loss) for purpose of calculating diluted earnings (loss) per common share

$ ( 2,984,204 )

$ ( 3,576,084 )

$ ( 7,544,537 )

Weighted avg.

2 unchanged sentences

Stock options

Restricted stock units

Dilutive securities

Total shares for purpose of calculating diluted net loss per common share

Diluted loss per share attributable to common stock

computation of diluted loss per share for the three months ended March 31, 2024 and 2023 does not include the following stock options

and warrants to purchase shares of common stock or unvested restricted stock units in the computation of diluted loss per share because

these instruments were antidilutive:

shares for purpose of calculating diluted net earnings (loss) per common share

earnings (loss) per share attributable to common stock

computation of diluted loss per share for the six months ended June 30, 2024 and 2023 does not include the following stock options and

warrants to purchase shares of common stock or unvested restricted stock units in the computation of diluted loss per share because these

instruments were antidilutive:

Schedule of Anti-dilutive Securities Excluded from Computation of Earnings Per Share

the Three Months Ended

the Six Months Ended

Stock options

Unvested restricted stock

Unvested restricted stock units

(4) Marketable Investment Securities

7 unchanged sentences

The amortized cost, gross unrealized holding gains, gross unrealized holding losses, and fair value for available-for-sale

securities by major security type and class of security as of March 31, 2024, and December 31, 2023, were as follows:

securities by major security type and class of security as of June 30, 2024, and December 31, 2023, were as follows:

of Available for Sale Securities

March 31, 2024

Amortized Cost

Gross unrealized holding gains

Gross unrealized holding losses

Aggregate fair value

Government treasury bills

government agency securities

December 31, 2023

Amortized Cost

Gross unrealized holding gains

Gross unrealized holding losses

Aggregate fair value

Government treasury bills

government agency securities

of debt securities classified as available-for-sale securities as of March 31, 2024 are as follows:

of debt securities classified as available-for-sale securities as of June 30, 2024 are as follows:

Schedule of Maturities of Debt Securities Classified as Available-for-Sale Securities

March 31, 2024

Amortized Cost

Aggregate fair value

Due within one year

were no sales of marketable investment securities during the three months ended March 31, 2024 and 2023 and therefore no realized gains

Additionally, during the three months ended March 31, 2024 and 2023, $ 6.7 million and $ 12.0 million of marketable investment

were no sales of marketable investment securities during either the three or six months ended June 30, 2024 and 2023 and therefore no

realized gains or losses.

Additionally, during the three months ended June 30, 2024 and 2023, $ 11.5 million and $ 5.9 million of marketable

investment securities matured, and during the six months ended June 30, 2024 and 2023, $ 18.2 million and $ 17.9 million of marketable

securities matured, respectively.

The Company determined there were no other-than-temporary impairments for the three months ended March

31, 2024 and 2023.

The Company determined there were no other-than-temporary impairments for either the three or six months

ended June 30, 2024 and 2023.

(5) Fair Value

13 unchanged sentences

The following table presents the placement in the fair value hierarchy of assets

and liabilities that are measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023:

and liabilities that are measured at fair value on a recurring basis as of June 30, 2024 and December 31, 2023:

of Fair Value, Assets and Liabilities Measured on Recurring Basis

Fair value measurements at reporting date using

March 31, 2024

Level 1 inputs

Level 2 inputs

Level 3 inputs

Cash equivalents - money market funds

value measurements at reporting date using

Cash equivalents

- money market funds

Cash equivalents - treasury

Government treasury bills

Government agency securities

Warrant liability

Fair value measurements at reporting date using

Deember 31, 2023

Level 1 inputs

Level 2 inputs

Level 3 inputs

Cash equivalents - money market funds

value measurements at reporting date using

Cash equivalents

- money market funds

Government treasury bills

government agency securities

Warrant liability

following methods and assumptions were used to determine the fair value of each class of assets and liabilities recorded at fair value

21 unchanged sentences

The significant

assumptions used in preparing the option pricing model for valuing the warrant liability as of March 31, 2024, include (i) volatility

assumptions used in preparing the option pricing model for valuing the warrant liability as of June 30, 2024, include (i) volatility

of 110.64 % , (ii) risk free interest rate of 5.45 % , (iii) strike price of $ 8.50 , (iv) fair value of common stock of $ 8.24 , and (v) expected

5 unchanged sentences

in circumstances that caused the transfer.

There were no transfers into or out of Level 1, Level 2, or Level 3 for the three ended March

There were no transfers into or out of Level 1, Level 2, or Level 3 for the three or six months

ended June 30, 2024.

(6) Income Taxes

3 unchanged sentences

annual effective tax rate, and if the estimated tax rate changes, the Company makes a cumulative adjustment.

March 31, 2024 and December 31, 2023, the Company had a full valuation allowance against its deferred tax assets, net of expected reversals

June 30, 2024 and December 31, 2023, the Company had a full valuation allowance against its deferred tax assets, net of expected reversals

of existing deferred tax liabilities, as it believes it is more likely than not that these benefits will not be realized.

(7) Contractual Agreements

Products, Inc.

March 29, 2012, the Company terminated its collaborative agreement with Solvay Pharmaceuticals, Inc.

(later acquired by Abbott Products,

Inc.) for TLANDO.

As part of the termination, the Company reacquired the rights to the intellectual property from Abbott.

All obligations

under the prior license agreement have been completed except that Lipocine will owe Abbott a perpetual 1 % royalty on net sales.

royalties are limited to $ 1.0 million in the first two calendar years following product launch, after which period there is not a cap

on royalties and no maximum aggregate amount.

If generic versions of any such product are introduced, then royalties are reduced by 50 %.

TLANDO was commercially launched on June 7, 2022.

The Company incurred royalty expense of approximately $ 9,000 and $ 4,000 during the

three months ended March 31, 2024 and 2023, respectively.

October 14, 2021, the Company entered into the Antares License Agreement with Antares pursuant to which the Company granted to Antares

an exclusive, royalty-bearing, sublicensable right and license to develop and commercialize, upon final approval of TLANDO® from

Food and Drug Administration (“FDA”), the Company’s TLANDO product with respect to testosterone replacement

therapy in males for conditions associated with a deficiency or absence of endogenous testosterone, as indicated in New Drug Application

208088, treatment of Klinefelter syndrome, and pediatric indications relating to testosterone replacement therapy

in males for conditions associated with a deficiency or absence of endogenous testosterone, in each case within

the United States.

TLANDO received FDA approval on March 29, 2022.

execution of the Antares License Agreement, Antares paid the Company an initial payment of $ 11.0 million.

Antares agreed to make additional

payments of $ 5.0 million to the Company on each of January 1, 2025, and January 1, 2026, provided that certain conditions were satisfied.

The Company was also eligible to receive milestone payments of up to $ 160.0 million in the aggregate, depending on the achievement of

certain sales milestones in a single calendar year with respect to TLANDO, as licensed by Antares under the Antares License Agreement.

In addition, the Company was to receive tiered royalty payments at rates ranging from percentages in the mid-teens up to 20 % of net sales

of TLANDO in the United States, subject to certain minimum royalty obligations.

On October 2, 2023, the Company received notice from

Antares of Antares’ termination of the License Agreement.

In accordance with the terms of the License Agreement, the License Agreement

terminated effective January 31, 2024.

On January 12, 2024, the Company entered into a license agreement (the “Verity License Agreement”)

with Verity Pharmaceuticals Inc.

See Note 7(c) for a description of the Verity License Agreement.

Upon termination

of the Antares License Agreement, all rights and licenses granted by the Company to Antares under the Antares License Agreement terminated

and all rights in TLANDO were transferred to the Company’s new licensing partner, Verity.

Company recognized revenue of approximately $ 67,000 and $ 0 for the three months ended March 31, 2024 and 2023, respectively, under the

Antares License Agreement and does not expect to receive any further royalties in the future.

Verity Pharmaceuticals, Inc.

January 12, 2024, the Company entered into a License Agreement (the “License Agreement”) with Gordon Silver Limited (“GSL”)

and Verity, pursuant to which the Company granted to GSL (an affiliate of Verity Pharma) an exclusive, royalty-bearing, sublicensable

Pharmaceuticals, Inc.

January 12, 2024, the Company entered into the Verity License Agreement with GSL

and Verity Pharma, pursuant to which the Company granted to GSL (an affiliate of Verity Pharma) an exclusive, royalty-bearing, sublicensable

right and license to commercialize the Company’s TLANDO product with respect to testosterone replacement therapy in males for conditions

19 unchanged sentences

606, Revenue from Contracts with Customers.

The Company evaluates the measure of progress each reporting period and, if necessary, adjusts

the measure of performance and related revenue recognition.

License revenue from payments to be received in the future will be recognized

when it is probable that we will receive license payments under the terms of the Verity License Agreement.

the three months ended March 31, 2024, the Company recognized $ 7.5 million in licensing revenue and $ 51,000 in royalty revenue.

Contract Research and Development

The Company evaluates the measure of progress each reporting period and, if necessary,

adjusts the measure of performance and related revenue recognition.

License revenue from payments to be received in the future will

be recognized when it is probable that we will receive license payments under the terms of the Verity License Agreement.

the Verity License Agreement with Verity Pharma, during the three months ended June 30, 2024, the Company recognized approximately

in royalty revenue.

During the six months ended June 30, 2024, the Company recognized $ 7.5

million in licensing revenue and approximately $ 140,000

in royalty revenue.

October 14, 2021, the Company entered into the Antares License Agreement with Antares pursuant to which the Company granted to Antares

an exclusive, royalty-bearing, sublicensable right and license to develop and commercialize, upon final approval of TLANDO® from

Food and Drug Administration (“FDA”), the Company’s TLANDO product with respect to testosterone replacement

therapy in males for conditions associated with a deficiency or absence of endogenous testosterone, as indicated in NDA No.

208088, treatment of Klinefelter syndrome, and pediatric indications relating to testosterone replacement therapy

in males for conditions associated with a deficiency or absence of endogenous testosterone, in each case within the United States.

received FDA approval on March 29, 2022.

execution of the Antares License Agreement, Antares paid the Company an initial payment of $ 11.0

Antares agreed to make additional payments of $ 5.0

million to the Company on each of January 1, 2025, and January 1, 2026, provided that certain conditions were satisfied.

was also eligible to receive milestone payments of up to $ 160.0

million in the aggregate, depending on the achievement of certain sales milestones in a single calendar year with respect to TLANDO,

as licensed by Antares under the Antares License Agreement.

In addition, the Company was to receive tiered royalty payments at rates

ranging from percentages in the mid-teens up to 20 %

of net sales of TLANDO in the United States, subject to certain minimum royalty obligations.

On October 2, 2023, the Company

received notice from Antares of Antares’ termination of the Antares License Agreement.

In accordance with the terms of the

Antares License Agreement, the Antares License Agreement terminated effective January 31, 2024.

On January 12, 2024, the Company

entered into the Verity License Agreement with Verity Pharma.

Upon termination of the Antares License Agreement, all rights and

licenses granted by the Company to Antares under the Antares License Agreement terminated and all rights in TLANDO were transferred

to the Company’s new licensing partner, Verity Pharma.

the Antares License Agreement, the Company did not recognize revenue during either the three months ended June 30, 2024 or 2023, and

recognized revenue of approximately $ 67,000 and $ 0 for the six months ended June 30, 2024 and 2023, respectively.

The Company does not

expect to receive any further royalties under the Antares License Agreement in the future.

Products, Inc.

March 29, 2012, the Company terminated its collaborative agreement with Solvay Pharmaceuticals, Inc.

(later acquired by Abbott

Products, Inc.

(“Abbott”) for TLANDO.

As part of the termination, the Company reacquired the rights to the intellectual property from Abbott.

All obligations under the prior license agreement have been completed except that Lipocine will owe Abbott a perpetual 1 %

royalty on net sales.

Such royalties are limited to $ 1.0

million in the first two calendar years following product launch, after which period there is not a cap on royalties and no maximum

aggregate amount.

If generic versions of any such product are introduced, then royalties are reduced by 50 % .

TLANDO was commercially launched on June 7, 2022.

The Company incurred royalty expense of approximately $ 7,000

during the three months ended June 30, 2024 and 2023, respectively, and approximately $ 16,000

during the six months ended June 30, 2024 and 2023, respectively.

Research and Development

Company has entered into agreements with various contract organizations that conduct pre-clinical, clinical, analytical and manufacturing

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The Company incurred expenses of $ 1.1 million and $ 1.7 million, respectively, for the three months ended

March 31, 2024 and 2023 under these agreements and has recorded these expenses in research and development expenses.

June 30, 2024 and 2023, respectively, and $ 2.9 million and $ 3.8 million for the six months ended June 30, 2024 and 2023, respectively,

under these agreements and has recorded these expenses in research and development expenses.

Company has a non-cancelable operating lease for office space and laboratory facilities in Salt Lake City, Utah.

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has been extended through February 28, 2025.

minimum lease payments under the non-cancelable operating lease as of March 31, 2024 are:

minimum lease payments under the non-cancelable operating lease as of June 30, 2024 are:

Schedule of Future Minimum Rental Payments for Operating Leases

Year ending December 31:

Total minimum lease payments

Company’s rent expense was $ 90,000 and $ 87,000 for the three months ended March 31, 2024 and 2023, respectively.

minimum lease payments

Company’s rent expense was $ 92,000 and $ 89,000 for the three months ended June 30, 2024 and 2023, respectively.

The Company’s

rent expense was $ 182,000 and $ 176,000 , for the six months ended June 30, 2024, respectively.

(9) Stockholders’ Equity

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of Common Stock

March 6, 2017, the Company entered into a sales agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co.

pursuant to which the Company may issue and sell, from time to time, shares of its common stock having an aggregate offering price of

up to the amount the Company registered on an effective registration statement pursuant to which the offering is being made.

currently has registered up to $ 50.0 million for sale under the Sales Agreement, pursuant to the Registration Statement on Form S-3 (File

333-250072) through Cantor as the Company’s sales agent.

Cantor may sell the Company’s common stock by any method permitted

by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) of the Securities Act, including sales made

directly on or through the Nasdaq Capital Market or any other existing trade market for our common stock, in negotiated transactions

at market prices prevailing at the time of sale or at prices related to prevailing market prices, or any other method permitted by law.

Cantor uses its commercially reasonable efforts consistent with its normal trading and sales practices and applicable law and regulations

to sell these shares.

The Company pays Cantor 3.0 % of the aggregate gross proceeds from each sale of shares under the Sales Agreement.

In addition, the Company has also provided Cantor with customary indemnification rights.

shares of the Company’s common stock sold under the Sales Agreement are sold and issued pursuant to the Registration Statement

on Form S-3 (File No.

333-250072), which was previously declared effective by the Securities and Exchange Commission, and the related

prospectus and one or more prospectus supplements.

The Company is not obligated to make any sales of its common stock under the Sales

The offering of common stock pursuant to the Sales Agreement will terminate upon the termination of the Sales Agreement as

permitted therein.

of March 31, 2024, the Company had sold an aggregate of 964,711 shares at a weighted-average sales price of $ 34.52 per share under the

At the Market Offering ( the “ATM Offering”) for aggregate gross proceeds of $ 33.3 million and net proceeds of $ 32.1 million,

after deducting sales agent commission and discounts and our other offering costs.

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

the Company did not sell any shares of its common stock pursuant to the Sales Agreement.

As of March 31, 2024, the Company had $ 40.8

million available for sale under the Sales Agreement, however, the Company is subject to General Instruction I.B.6 of Form S-3 which

limits the amounts that we may sell under the registration statement.

April 24, 2024 the Sales Agreement with Cantor was terminated and a new sales agreement was entered into with Alliance Global Partners

(“A.G.P.”) on April 26, 2024 as noted in Note 13, Subsequent Events.

April 26, 2024, the Company entered into a sales agreement with A.G.P.

Sales Agreement”) pursuant to which the

Company may issue and sell, from time to time, shares of its common stock having an aggregate offering price of up to the amount the

Company registered on an effective registration statement pursuant to which the offering is being made.

The Company currently has registered

$ 10,616,169 shares of common shares for sale under the Sales Agreement, pursuant to the Registration Statement on Form S-3, as amended

333-275716) (the “Form S-3”), through A.G.P.

as the Company’s sales agent.

may sell the Company’s

common stock by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) of the

Securities Act, including sales made directly on or through the Nasdaq Capital Market or any other existing trade market for our common

stock, in negotiated transactions at market prices prevailing at the time of sale or at prices related to prevailing market prices, or

any other method permitted by law.

will use its commercially reasonable efforts consistent with its normal trading and sales practices

and applicable law and regulations to sell shares under the A.G.P.

Sales Agreement.

The Company will pay A.G.P.

3.0 % of the aggregate

gross proceeds from each sale of shares under the A.G.P.

Sales Agreement.

In addition, the Company has also provided A.G.P.

with customary

indemnification rights.

shares of the Company’s common stock to be sold under the A.G.P.

Sales Agreement will be sold and issued pursuant to the Form S-3,

as amended, which was previously declared effective by the Securities and Exchange Commission, and the related prospectus and one or

more prospectus supplements.

Company is not obligated to make any sales of its common stock under the A.G.P.

Sales Agreement.

The offering of common stock pursuant

to the A.G.P.

Sales Agreement will terminate upon the termination of the A.G.P.

Sales Agreement as permitted therein.

The Company and

may each terminate the A.G.P.

Sales Agreement at any time upon ten days’ prior notice.

of June 30, 2024, the Company had not sold any shares under the A.G.P.

Sales Agreement.

on March 6, 2017, the Company entered into a sales agreement (the “Cantor Sales Agreement”) with Cantor Fitzgerald &

(“Cantor”) pursuant to which the Company could issue and sell, from time to time, shares of its common stock having

an aggregate offering price of up to the amount the Company registered on an effective registration statement pursuant to which the

offering is being made.

of June 30, 2024, the Company had sold an aggregate of 996,821

shares at a weighted-average sales price of $ 33.62

per share under the At the Market Offering ( the “ATM Offering”) Cantor Sales Agreement, for aggregate gross proceeds of

million and net proceeds of $ 32.4

million, after deducting sales agent commission and discounts and other offering costs.

During the three and six months ended June

30, 2024, the Company sold 32,110

shares of its common stock pursuant to the Cantor Sales Agreement.

On April 24, 2024 the Cantor Sales Agreement was

B Preferred Stock

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Stock-based compensation cost that has been expensed in the statements of

operations amounted to approximately $ 99,000 and $ 178,000 , respectively, for the three months ended March 31, 2024 and 2023, respectively,

and is allocated as follows:

operations amounted to approximately $ 102,000 and $ 165,000 , respectively, for the three months ended June 30, 2024 and 2023, and approximately

$ 202,000 and $ 343,000 , respectively, for the six months ended June 30, 2024 and 2023, and is allocated as follows:

of Employee Service Share-based Compensation, Allocation of Recognized Period Costs

Three Months Ended March 31,

Months Ended June 30,

Research and development

General and administrative

Company issued 25,626 and 17,647 stock options, respectively, during the three months ended March 31, 2024 and 2023.

Company issued 8,820 stock options, during each of the three months ended June 30, 2024 and 2023, and issued 34,446 and 10,086 stock

options, respectively, during the six months ended June 30, 2024 and 2023.

assumptions used in the determination of the fair value of stock options granted are as follows:

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The volatility factor is based solely on the Company’s trading history.

options granted during the three months ended March 31, 2024 and 2023, the Company calculated the fair value of each option grant on

the respective dates of grant using the following weighted average assumptions:

options granted during the six months ended June 30, 2024 and 2023, the Company calculated the fair value of each option grant on the

respective dates of grant using the following weighted average assumptions:

of Key Assumption of Fair Value of Stock Options Granted

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estimated by management, additional adjustments to compensation expense may be required in future periods.

of March 31, 2024, there was approximately $ 435,000 of total unrecognized compensation cost related to unvested stock option compensation

of June 30, 2024, there was approximately $ 384,000 of total unrecognized compensation cost related to unvested stock option compensation

granted under the Company’s stock option plan.

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and will be adjusted for subsequent changes in estimated forfeitures.

Additionally, as of March 31, 2024, there was $ 79,000 of total

unrecognized compensation costs related to unvested restricted stock units that have either time-based or performance vesting.

Additionally, as of June 30, 2024, there was $ 76,000 of total unrecognized

compensation costs related to unvested restricted stock units that have either time-based or performance vesting.

April 2014, the Board adopted the 2014 Stock and Incentive Plan (“2014 Plan”) subject to shareholder approval which was received

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increase the authorized number of shares of common stock of the Company issuable under all awards granted under the 2014 Plan from 145,405

Finally, upon receiving shareholder approval in June 2020, the 2014 Plan was further amended and restated to increase the

authorized number of shares of common stock of the Company issuable under all awards granted under the 2014 Plan from 189,522 to 336,582 .

The Board, on an option-by-option basis, determines the number of shares, exercise price, term, and vesting period for options granted.

Upon receiving shareholder approval in June 2020, the 2014 Plan was further amended and restated to increase the authorized

number of shares of common stock of the Company issuable under all awards granted under the 2014 Plan from 189,522 to 336,582 .

2024, the 2014 Plan was further amended and restated to increase the authorized number of shares of common stock of the Company issuable

under all awards granted from 336,582 to 600,000 .

The Board, on an option-by-option basis, determines the number of shares, exercise

price, term, and vesting period for options granted.

Options granted generally have a ten -year contractual life.

The Company issues shares of common stock upon the exercise of options with

the source of those shares of common stock being either newly issued shares or shares held in treasury.

An aggregate of 336,582 shares

of common stock are authorized for issuance under the 2014 Plan, with 2,448 shares remaining available for grant as of March 31, 2024.

The Company issues shares

of common stock upon the exercise of options with the source of those shares of common stock being either newly issued shares or shares

held in treasury.

An aggregate of 600,000 shares of common stock are authorized for issuance under the 2014 Plan, with 257,046 shares

remaining available for grant as of June 30, 2024.

summary of stock option activity is as follows:

of Stock Option Activity

Outstanding stock options

Number of shares

Weighted average exercise price

stock options

average exercise price

Balance at December 31, 2023

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Options forfeited

Options cancelled

Balance at March 31, 2024

Options exercisable at March 31, 2024

following table summarizes information about stock options outstanding and exercisable at March 31, 2024:

Balance at June 30, 2024

Options exercisable at June 30, 2024

following table summarizes information about stock options outstanding and exercisable at June 30, 2024:

of Share-based Compensation of Stock Options Outstanding and Exercisable

Options outstanding

Options exercisable

Number outstanding

Weighted average remaining contractual life (Years)

Weighted average exercise price

Aggregate intrinsic value

Number exerciseable

Weighted average remaining contractual life (Years)

Weighted average exercise price

Aggregate intrinsic value

average remaining contractual life

average exercise

average remaining contractual life

average exercise price

intrinsic value

intrinsic value for stock options is defined as the difference between the current market value and the exercise price.

stock options exercised during the three months ended March 31, 2024 and 2023, respectively.

stock options exercised during either the three or six months ended June 30, 2024 or 2023.

(f) Restricted

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of Restricted Stock Unit Activity

Number of unvested restricted stock units

of unvested restricted stock units

Balance at December 31, 2023

Balance at March 31, 2024

weighted average grant date fair value of restricted stock units awarded during the three months ended March 31, 2024 was $ 3.61 per share.

No restricted stock units were awarded during the three months ended March 31, 2023.

Balance at June 30, 2024

were no restricted stock units awarded during either the three months ended June 30, 2024 or 2023 .

There were 21,762 and 0 restricted

stock units awarded during the six months ended June 30, 2024 and 2023, respectively.

The weighted average grant date fair value of restricted

stock units awarded during the six months ended June 30, 2024 was $ 3.61 per share.

Stock Warrants

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upon a fundamental transaction.

of March 31, 2024, the Company had 64,362 common stock warrants outstanding from the November 2019 Offering to purchase an equal number

of June 30, 2024, the Company had 64,362 common stock warrants outstanding from the November 2019 Offering to purchase an equal number

of shares of common stock.

The fair value of these warrants on March 31, 2024 and on December 31, 2023 was determined using the Black-Scholes

The fair value of these warrants on June 30, 2024 and on December 31, 2023 was determined using the Black-Scholes

option pricing model with the following Level 3 inputs (as defined in the November 2019 Offering):

Schedule of Fair Value of Warrants

March 31, 2024

December 31, 2023

Expected life in years

1 unchanged sentence

Dividend yield

the three months ended March 31, 2024, the Company recorded a non-cash loss of approximately $ 40,000 from the change in fair value of

the November 2019 Offering warrants.

During the three months ended March 31, 2023, the Company recorded a non-cash gain of approximately

$ 98,000 from the change in fair value on the November 2019 Offering warrants.

The following table is a reconciliation of the warrant

liability measured at fair value using level 3 inputs:

the three and six months ended June 30, 2024, the Company recorded a non-cash loss of approximately $ 84,000 and $ 125,000 , respectively,

from the change in fair value of the November 2019 Offering warrants.

During the three and six months ended June 30, 2023, the Company

recorded non-cash gains of approximately $ 27,000 and $ 126,000 , respectively, from the change in fair value on the November 2019 Offering

The following table is a reconciliation of the warrant liability measured at fair value using level 3 inputs:

Schedule of Reconciliation of Warrant Liability

Warrant Liability

Balance at December 31, 2023

Change in fair value of common stock warrants

Balance at March 31, 2024

in fair value of common stock warrants

Balance at June 30, 2024

Additionally,

in the February 2020 Offering, the Company issued 296,593 common stock warrants.

in an offering in February 2020, the Company issued 296,593 common stock warrants.

However, because these warrants do not provide the warrant

holder the option to put the warrant back to the Company, the warrants are classified as equity.

As of March 31, 2024, and 2023, there

were 49,433 warrants outstanding that were issued in the February 2020 Offering.

As of June 30, 2024, and 2023, there

were 49,433 warrants outstanding that were issued in February 2020.

following table summarizes the number of common stock warrants outstanding and the weighted average exercise price:

Schedule of Number of Warrants Outstanding and the Weighted Average Exercise Price

Weighted Average Exercise Price

Average Exercise Price

Outstanding at December 31, 2023

Balance at March 31, 2024

were no common stock warrants exercised during either the three months ended March 31, 2024 or 2023.

following table summarizes information about common stock warrants outstanding at March 31, 2024:

Balance at June 30, 2024

were no common stock warrants exercised during either the three or six months ended June 30, 2024 or 2023.

following table summarizes information about common stock warrants outstanding at June 30, 2024:

of Common Stock Warrants Outstanding

Warrants outstanding

Number exercisable

Weighted average remaining contractual life (Years)

Weighted average exercise price

Aggregate intrinsic value

average remaining contractual life (Years)

average exercise price

intrinsic value

(10) Commitments and Contingencies

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(11) Agreement with Spriaso, LLC

Company has a license and a services agreement with Spriaso, a related-party that is majority-owned by certain current and former directors

of Lipocine Inc.

Company has a license and a services agreement with Spriaso, a related-party that is majority-owned by certain current and former

directors of Lipocine Inc.

and their affiliates.

Under the license agreement, the Company assigned and transferred to Spriaso all of the Company’s

rights, title and interest in its intellectual property to develop products for the cough and cold field.

In addition, Spriaso received

all rights and obligations under the Company’s product development agreement with a third-party.

In exchange, the Company will

receive a royalty of 20 percent of the net proceeds received by Spriaso, up to a maximum of $ 10.0 million.

Spriaso also granted back

to the Company an exclusive license to such intellectual property to develop products outside of the cough and cold field.

also agreed to continue providing up to 10 percent of the services of certain employees to Spriaso for a period of time.

The agreement

to provide services expired in 2021 ;

Under the license agreement, the Company assigned and transferred to Spriaso all of

the Company’s rights, title and interest in its intellectual property to develop products for the cough and cold field.

addition, Spriaso received all rights and obligations under the Company’s product development agreement with a third-party.

exchange, the Company will receive a royalty of 20

percent of the net proceeds received by Spriaso, up to a maximum of $ 10.0

Spriaso also granted back to the Company an exclusive license to such intellectual property to develop products outside of

the cough and cold field.

Company also agreed to continue providing up to 10 percent of the services of certain employees to Spriaso for a period of time.

agreement to provide services expired in 2021 ;

however, it may be extended upon written agreement of Spriaso and the Company.

Additionally, during

the three months ended March 31, 2024 and 2023, the Company received licensing revenue from Spriaso of approximately $ 0 and $ 55,000 ,

During the three and six months ended June 30, 2024, the Company did not receive any revenue from Spriaso.

During the three and six

months ended June 30, 2023, the Company received licensing revenue from Spriaso of $ 0

and approximately $ 55,000 ,

respectively.

Spriaso filed its first NDA and as an affiliated entity of the Company, it used up the one-time waiver for user fees for

a small business submitting its first human drug application to the FDA.

Spriaso is considered a variable interest entity under the FASB

ASC Topic 810-10, Consolidations, however the Company is not the primary beneficiary and has therefore not consolidated Spriaso.

Spriaso filed its first NDA and as an affiliated entity of the Company, it used up the one-time waiver for user fees

for a small business submitting its first human drug application to the FDA.

Spriaso is considered a variable interest entity under

the FASB ASC Topic 810-10, Consolidations, however the Company is not the primary beneficiary and has therefore not consolidated

(12) Recent Accounting Pronouncements

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Management is currently assessing the impact of the adoption of this ASU on the financials statements of the

(13) Subsequent Events

April 24, 2024, the Company terminated the Sales Agreement with Cantor and on April 26, 2024, the Company entered into a sales agreement

Sales Agreement”) pursuant to which the Company may issue and sell, from time to time, shares of

its common stock having an aggregate offering price of up to the amount the Company registered on an effective registration statement

pursuant to which the offering is being made.

The Company currently has registered $ 10,616,169 shares of common shares for sale under

the Sales Agreement, pursuant to the Registration Statement on Form S-3, as amended (File No.

333-275716) (the “Form S-3”),

through A.G.P.

as the Company’s sales agent.

may sell the Company’s common stock by any method permitted by law deemed

to be an “at the market offering” as defined in Rule 415(a)(4) of the Securities Act, including sales made directly on or

through the Nasdaq Capital Market or any other existing trade market for our common stock, in negotiated transactions at market prices

prevailing at the time of sale or at prices related to prevailing market prices, or any other method permitted by law.

its commercially reasonable efforts consistent with its normal trading and sales practices and applicable law and regulations to sell

shares under the A.G.P.

Sales Agreement.

The Company will pay A.G.P.

3.0 % of the aggregate gross proceeds from each sale of shares under

Sales Agreement.

In addition, the Company has also provided A.G.P.

with customary indemnification rights.

shares of the Company’s common stock to be sold under the A.G.P.

Sales Agreement will be sold and issued pursuant to the Form S-3,

as amended, which was previously declared effective by the Securities and Exchange Commission, and the related prospectus and one or

more prospectus supplements.

Company is not obligated to make any sales of its common stock under the A.G.P.

Sales Agreement.

The offering of common stock pursuant

to the A.G.P.

Sales Agreement will terminate upon the termination of the A.G.P.

Sales Agreement as permitted therein.

The Company and

may each terminate the A.G.P.

Sales Agreement at any time upon ten days’ prior notice.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

following discussion of our financial condition and results of operations should be read in conjunction with our unaudited condensed

consolidated financial statements and the related notes thereto and other financial information included elsewhere in this report.

additional context with which to understand our financial condition and results of operations, see the management’s discussion

and analysis included in our Form 10-K, filed with the SEC on March 7, 2024, as well as the financial statements and related notes contained

used in the discussion below, “we,” “our,” and “us” refers to Lipocine.

Forward-Looking

section and other parts of this report contain forward-looking statements within the meaning of Section 27A of the Securities Act of

1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties.

Forward-looking

statements provide current expectations of future events based on certain assumptions and include any statement that does not directly

relate to any historical or current fact.

Forward-looking statements may refer to such matters as products, product benefits, pre-clinical

and clinical development timelines, clinical and regulatory expectations and plans, expected responses to regulatory actions, anticipated

financial performance, future revenues or earnings, business prospects, projected ventures, new products and services, anticipated market

performance, expected research and development and other expenses, future expectations for liquidity and capital resources needs and

similar matters.

Such words as “may”, “will”, “expect”, “continue”, “estimate”,

“project”, and “intend” and similar terms and expressions are intended to identify forward looking statements.

Forward-looking statements are not guarantees of future performance and our actual results may differ significantly from the results

discussed in the forward-looking statements.

Factors that might cause such differences include, but are not limited to, those discussed

in Part I, Item 1A (Risk Factors) of our Form 10-K filed with the SEC on March 7, 2024.

Except as required by applicable law, we assume

no obligation to revise or update any forward-looking statements for any reason.

of Our Business

are a biopharmaceutical company focused on leveraging our proprietary Lip’ral platform to develop differentiated products through

the oral delivery of previously difficult to deliver molecules, focused on treating Central Nervous System (“CNS”) disorders.

Our proprietary delivery technologies are designed to improve patient compliance and safety through orally available treatment options.

Our primary development programs are based on oral delivery solutions for poorly bioavailable drugs.

We have a portfolio of differentiated

innovative product candidates that target high unmet needs for neurological and psychiatric CNS disorders, liver diseases, and hormone

supplementation for men and women.

January 12, 2024, we entered into a license agreement (the “Verity License Agreement”) for the development and commercialization

of our approved product, TLANDO®, an oral testosterone replacement therapy (“TRT”) comprised of testosterone undecanoate

(“TU”), with Verity Pharmaceuticals, Inc.

(“Verity” or our “Licensee”), pursuant to which we granted

to Verity an exclusive, royalty-bearing, sublicensable right and license to develop and commercialize the TLANDO product for TRT in the

Any FDA required post-marketing studies will also be the responsibility of our Licensee, Verity.

On March 28, 2022,

the FDA approved TLANDO as a TRT in adult males for conditions associated with a deficiency of endogenous testosterone, also known as

hypogonadism.

On June 7, 2022, our former commercial partner Antares (a wholly owned subsidiary of Halozyme) announced the commercial

launch of TLANDO, an oral treatment indicated for testosterone replacement therapy in adult males for conditions associated with a deficiency

or absence of endogenous testosterone (primary or hypogonadotropic hypogonadism).

clinical development pipeline candidates include:

LPCN 1154 for postpartum depression (“PPD”);

LPCN 2101 for epilepsy;

2203 for essential tremor and LPCN 2401 as an adjunct therapy to incretin mimetics as an aid for improved body composition in chronic

weight management.

In addition to our clinical development product candidates, we have assets for which we expect to seek partnerships

to enable further development including TLANDO for territories outside of North America, LPCN 1148 comprising a novel prodrug of testosterone

and testosterone laurate (“TL”), for the management of decompensated cirrhosis, LPCN 1144, an oral prodrug of androgen receptor

modulator for the treatment of non-cirrhotic non-alcoholic steatohepatitis (“NASH”) which has completed Phase 2 testing;

and LPCN 1107, potentially the first oral hydroxy progesterone caproate (“HPC”) product indicated for the prevention of recurrent

preterm birth (“PTB”), which has completed a dose finding clinical study in pregnant women and has been granted orphan drug

designation by the FDA.

following charts summarize the status of our product candidate development and partnering programs:

goal is to become a leading biopharmaceutical company focused on leveraging our proprietary Lip’ral drug delivery technology platform

to develop differentiated products through oral delivery of previously difficult to deliver molecules for CNS disorders.

The key components

of our strategy are to:

LPCN 1154 and other CNS product candidates.

We intend to focus on the development of endogenous neuroactive steroids (“NASs”)

which have broad applicability in treating various CNS conditions where we can leverage our technology platform to develop highly differentiated

oral therapeutics.

Our priority is on the development of LPCN 1154, a fast-acting oral antidepressant for postpartum depression (“PPD”)

with potential for outpatient use.

our Licensee in commercialization of our licensed oral TRT option.

We believe the TRT market needs a differentiated, convenient oral

We have exclusively licensed rights to TLANDO to Verity for commercialization of TLANDO in the U.S.

We plan to support

our Licensee’s efforts to effectively enable the availability of TLANDO to patients in a timely manner, in addition to receiving

milestone and royalty payments associated with TLANDO commercialization as agreed to in the Verity License Agreement.

partnership(s) to continue the advancement of pipeline assets .

We continuously strive to prioritize our resources in seeking

partnerships for our pipeline assets.

We are currently exploring partnerships for our liver programs LPCN 1144, our candidate for treatment

of non-cirrhotic NASH and LPCN 1148 for the management of decompensated cirrhosis including prevention of the recurrence of overt hepatic

encephalopathy, and LPCN 2401 as an adjunct therapy to incretin mimetics as an aid for improved body composition in chronic weight management,

and LPCN 1107, our candidate for prevention of pre-term birth.

We are also exploring the possibility of licensing LPCN 1021 (known as

TLANDO in the United States) and LPCN 1111 to third parties outside the United States and Canada, although no licensing agreement has

been entered into by the Company.

Pipeline Product Candidates

pipeline of clinical development candidates includes LPCN 1154 for PPD, LPCN 2101 for epilepsy, LPCN 2203 for essential tremor, LPCN

2401 as an aid for improved body composition in chronic weight management, and LPCN 1148, an androgen therapy for the management of

We will continue to explore other product development candidates targeting CNS indications with a significant unmet need.

We will also continue efforts to enter into partnership arrangements for the continued development and/or marketing of LPCN 1144,

LPCN 1148, LPCN 2401, LPCN 1107 as well as for the TRT assets (TLANDO and LPCN 1111) outside of the United States and

products are based on our proprietary Lip’ral drug delivery technology platform.

Lip’ral-based TLANDO was approved by the

FDA in March 2022.

Lip’ral technology is a patented technology based on lipidic compositions which form an optimal dispersed phase

in the gastrointestinal environment for improved absorption of insoluble drugs.

The drug loaded dispersed phase presents the solubilized

drug efficiently at the absorption site (gastrointestinal tract membrane) thus improving the absorption process and making the drug less

dependent on physiological variables such as dilution, gastro-intestinal pH and food effects for absorption.

Lip’ral-based formulation

enables improved solubilization and higher drug-loading capacity, which can lead to improved bioavailability, reduced dose, faster and

more consistent absorption, reduced variability, reduced sensitivity to food effects, improved patient compliance, and targeted lymphatic

delivery where appropriate.

Programs for CNS Disorders

preferred endogenous or naturally occurring NAS present in central nervous system act as positive allosteric modulators (“PAMs”)

of the GABA A receptor, the major biological target of the inhibitory neurotransmitter γ-aminobutyric acid (“GABA A” ).

To improve oral delivery of these modulators, several synthetic NAS derivatives of endogenous GABA A receptor PAMs have been

developed for therapeutic use in the past few decades.

believe through utilization of our proprietary technology we may have the ability to enable effective oral delivery of endogenous GABA A

receptor PAMs which historically had been deemed to be not orally bioavailable.

As a novel drug class, NASs have received considerable

attention because of their potential to treat various neuropsychiatric conditions including depression, movement disorders, epilepsy,

anxiety, and neurodegenerative diseases.

We have conducted Phase 1 pharmacokinetic (“PK”) studies for each of our three lead

NAS candidates which have demonstrated promising PK results, safety, and tolerability and we are evaluating additional undisclosed CNS-focused

Product Candidate for PPD

most advanced NAS candidate is LPCN 1154, a non-invasive, rapid onset, oral formulation of the neuroactive steroid brexanolone which

we are developing for the treatment of PPD.

The FDA recently agreed with our proposal for establishing the efficacy of LPCN 1154 through

a pivotal PK bridge to an approved IV infusion brexanolone via a 505(b)(2) NDA filing.

The company has completed clinical oral PK studies

including a pilot food effect study, and a pilot PK bridge study.

In addition, as a prelude to a LPCN 1154 pivotal study, a multi-dose

study was done confirming the dosing regimen for the pivotal study using the scaled up “to be marketed” formulation required

for NDA filing.

In March 2024, we completed enrollment and dosed the first cohort of patients in our pivotal PK study.

We expect to have

top line results from the pivotal study in the second quarter of 2024.

a type of major depressive disorder with onset either during pregnancy or within four weeks of delivery, refers to depression persisting

up to 12 months after childbirth.

PPD can be clinically segmented by the severity of symptoms and presence of a comorbidity, including

Approximately 1 in 8 mothers suffers from PPD in the United States alone;

this equates to approximately 500,000 women being

affected by PPD annually.

Overview - PPD

is distinct from the “baby blues,” a condition that up to 70% of all new mother’s

“baby blues” tend to be short-lived emotional conditions that do

not interfere with daily activities.

of PPD include hallmarks of major depression, including, but not limited to, sadness, depressed

mood, loss of interest, change in appetite, insomnia, sleeping too much, fatigue, difficulty

thinking/concentrating, excessive crying, fear of harming the baby/oneself, and/or thoughts

of death or suicide.

pregnancy, levels of endogenous NASs increase considerably along with levels of progesterone;

however, they drop sharply postpartum.

It has been hypothesized that the rapid perinatal

decrease in circulating levels of endogenous NASs may be involved in the development of PPD.

The first approved treatment option for PPD was an injectable containing endogenous NASs.

may persist long after child delivery.

Additionally, approximately 40% of women relapse in

subsequent pregnancies or on other occasions.

● Psychiatric

comorbidities are common in patients with epilepsy.

Patients with epilepsy are at high risk

for major depressive disorders and PPD.

Reported PPD rates are higher among women with epilepsy

than the general population.

family history and/or previous experience of depression or other mood disorders

● Physiological:

rapid changes in sex hormones, stress hormones, and thyroid hormone levels during and after

● Environmental:

stressful life events, changes in relationships at home and at work, and/or lack of familial

believe there is considerable unmet need within women with PPD due to a lack of convenient and fast-acting oral therapies.

Serotonin Reuptake Inhibitors (“SSRIs”) have been the traditional first-line choice for women with severe PPD and require

weeks for onset of efficacy;

therefore, a need for an oral treatment option with a faster onset of action remains a significant unmet

need in treating PPD, especially in mothers with moderate to severe depression prone to harmful actions.

brexanolone (Zulresso™, Sage Therapeutics) became the first FDA-approved treatment for postpartum depression.

However, numerous

factors limit the utilization of injectable brexanolone such as method of administration, cost, and safety concerns.

In addition to Zulresso,

SAGE Therapeutics received FDA approval for zuranolone (brand name ZURZUVAE™) in August 2023 and Zurzuvae was launched commercially

in December 2023.

Zuranolone, a synthetic neuroactive steroid derivative, is an oral, once daily 14-day treatment for postpartum depression

and is the first oral medication approved by the FDA for the treatment of postpartum depression.

Per label, besides long terminal half-life

of approximately 19.7 to 24.6 hours and dosage modifications needed for concomitant use with CYP3A4 modulators, warnings and precautions

include CNS depressant effects, impaired ability to drive or engage in other potentially hazardous activities and embryo-fetal toxicity.

believe LPCN 1154 targets the current unmet need for robust, rapid relief with 48-hour treatment duration through a convenient oral therapy

candidate comprising bioidentical NASs with good tolerability.

NAS for Epilepsy

are currently evaluating an additional NAS candidate, LPCN 2101, for women with epilepsy (“WWE”).

We have completed pre-clinical

and Phase 1 studies for LPCN 2101 which demonstrated promising PK results, safety and tolerability.

In July 2022 our IND was accepted

by the FDA for LPCN 2101 for adults with epilepsy and we plan to initiate a Phase 2 IND opening proof-of-concept study to evaluate the

safety, tolerability, and efficacy of LPCN 2101, subject to resource prioritization.

Overview – Epilepsy

is defined by the 1) occurrence of at least two unprovoked seizures more than 24 hours apart, 2) occurrence of one unprovoked seizure

and a probability of further seizures occurring over the next 10 years, and/or 3) diagnosis of an epilepsy syndrome.

Patients with epilepsy

have increased risk of mortality due to direct effects of seizures (e.g., status epilepticus, car accidents) and indirect effects of

seizures (e.g., suicide, cardiovascular effects).

is a disorder of the brain that causes seizures, affecting the physical, mental, and social well-being of persons, and is associated

with a 2 to 3 times greater mortality rate compared with the general population.

About 60-65% of epilepsy is idiopathic and about 30%

of patients are refractory (i.e., epilepsy not well managed with currently available Anti-Seizure Medications (“ASMs”).

is the most common neurological disorder during pregnancy.

is estimated that approximately 900,000 childbearing (“CB”) age women suffer from active epilepsy in the U.S.

age with epilepsy face many additional challenges due to hormonal influences on seizure activity and endocrine function throughout the

different phases of their reproductive cycles.

Elevated estrogen or decreased progesterone levels can exacerbate seizure frequency.

these women experience hormonal and endogenous NAS imbalances, coupled with fluctuations in the blood levels of ASMs that impact control

of seizures, efficacy of oral contraceptives, any coexisting anxiety and/or depression and any associated sleep impairment.

patients are 5-20 times more likely to develop depression.

segmentation can be categorized by epilepsy type, comorbidities and patient subgroups.

Categorization of focal epilepsy, generalized

epilepsy, combined focal and generalized epilepsy, and unknown epilepsy can guide the choice of ASM.

Special patient subgroups, including

WWE of CB age and elderly patients, require special care and management of epilepsy.

Comorbidities such as depression and anxiety may

be co-treated with therapies that do not aggravate seizures and have no drug interaction with the ASM used for epilepsy.

effective dose and monotherapy are preferred, management of patients with epilepsy is focused on controlling seizures, avoiding adverse

events, and maintaining quality of life.

Despite a wide range of ASMs available, about 30% of all people with epilepsy still fail to

respond to treatment effectively.

Women with epilepsy face specific challenges throughout their lifespan because of seizures, ASMs, and

hormonal fluctuations.

with epilepsy were once counseled to avoid pregnancy, but epilepsy is no longer considered a contraindication to pregnancy.

for WWE in the preconception phase either intending to start a family (planning pregnancy) or using contraception to prevent an unplanned

pregnancy face significant challenges to balance seizure control efficacy with the selection and dosage of ASMs and ASM-related risks

such as, among other risks, fetal-neonatal toxicity, contraception failure, and psychiatric side effects.

ASMs are known to have teratogenic effects on the developing fetus (converging evidence from registry studies indicates that teratogenic

risks are highest with valproate, followed by carbamazepine and topiramate).

Other commonly prescribed ASMs, including older generation

agents, such as phenobarbital and phenytoin, have been associated with higher risks as compared with lamotrigine, levetiracetam, clonazepam

and gabapentin (Vajda et al., 2014;

Voinescu and Pennell, 2015).

Moreover, risks associated with ASMs are considerable early in pregnancy;

therefore, it is necessary that WWE of CB age undergo counseling, monitoring, and adjustment to the most appropriate ASM prior to becoming

It is preferable that WWE of CB age discuss seizure control with their doctor for at least 6 months before conception and,

if possible, cease ASM therapy or use the lowest effective dose of a single anticonvulsant according to the type of epilepsy and the

fetal toxicity of the ASM.

Anxiety, depression, lack of adherence to ASM, and/or contraception failure may be experienced by women who

are worried about unplanned pregnancy or are late in confirming pregnancy, planned or unplanned.

ASMs can reduce the efficacy of oral

contraceptives, compounding this problem.

multidirectional interactions between female hormones, seizures, and ASMs exist.

Most hormones act as NASs and can thus modulate brain

excitability.

Any changes in endogenous or exogenous hormone levels can affect the occurrence of seizures, either directly or via PK

interactions that modify the plasma levels of ASMs (Harden, 2008).

The PK interactions between oral contraceptives and ASMs are bidirectional

(Johnston and Crawford, 2014).

The efficacy of hormonal contraception may be diminished for women taking CYP-P450 enzyme inducing ASMs.

Epilepsy is not a medical condition in which contraceptives are contraindicated.

Contraceptive failure, possibly related to ASMs, may

be responsible for up to 1 in 4 unplanned pregnancies in WWE (~12.5% of all WWE pregnancies), versus a rate of 1% in healthy women.

need to treat WWE in CB age

is estimated that approximately 900,000 CB age women suffer from active epilepsy in the U.S.

Women of CB age with epilepsy face many

additional challenges such as hormonal influences on seizure activity and endocrine function throughout the different phases of their

reproductive cycles, and approximately 30% of patients with epilepsy cannot be efficiently controlled with available ASMs making consideration

of newer pharmacological treatment development options important.

uncontrolled seizures in WWE of CB age is the primary aim during preconception, pregnancy, and postpartum phases.

Therefore, uncompromised

ASM efficacy with acceptable variability and less or no drug-drug interactions achieved with lowest possible monotherapy dose to address

fetal toxicity concerns remain highly unmet needs.

Moreover, control of seizures including prevention of breakthrough seizures is critical

when planning for pregnancy and also during pregnancy, as it can also lead to undesired falls or auto-accidents and compromise freedom

ASMs have the potential to induce contraception failures, reproductive hormone imbalance, anxiety, and depression.

There remains an unmet

need for an ASM without the aforementioned downsides, with no to low fetal-neonatal toxicity and without any breast-feeding concerns

as well as the potential to treat associated comorbidities.

over 30 molecules have been approved for the treatment of epilepsy in the U.S., no epilepsy drug has been specifically approved for WWE

We believe our endogenous NASs as GABA A PAMs, while targeting the goal of seizure control, also have the potential

for additional benefits in psychiatric disorders comorbidities (e.g., anxiety and/or depression) and sleep impairment.

Moreover, these

oral endogenous NASs could potentially address some of the fetal toxicity concerns related to unplanned or planned pregnancy in WWE.

S.Bangar et al.

Functional Neurology 2016;

Reimers et al.

Oral Product for Management of Essential Tremor

2203 is an oral candidate for management of essential tremor comprising a bioidentical GABA modulating NAS.

We have successfully completed

oral pharmacokinetics with bioidentical GABA Modulating NAS and are planning to submit a protocol for a proof-of-concept phase 2 study

Overview - Essential Tremor

Tremor (“ET”) is one of the most common movement disorders in the United States, affecting an estimated 7 million in the

For ET patients, uncontrollable shaking of the hands, head, voice, or legs creates difficulty eating, dressing, writing, and pursuing

other day-to-day tasks.

The etiology of ET is largely unknown, but reduced GABA A receptor levels and decreased GABAergic activity

have been observed in ET.

ET is often associated with aging populations, ET can begin much earlier in life, with a progressive disease course that can eventually

necessitate a care partner.

Social anxiety and depressive symptoms can manifest in patients with ET as tremor severity increases, and

may negatively impact a patient’s ability to work and engage in hobbies.

In an interview study of ET patients and care partners,

the most common impacts on activities of daily living are pouring liquids and writing/typing (100%) and grooming/hygiene, drinking, dressing,

eating, and reading (80-85%).

Overall, 90% of participants noted the emotional impact of ET, with 75% reporting tremor-related worry

only FDA approved pharmacological treatment for ET was approved more than 50 years ago, and the majority of patients with ET experience

a sub-optimal response with standard-of-care treatments, highlighting numerous and compelling unmet needs in care such as daytime efficacy

and improved tolerability, a PRN (pro re nata) or “as needed” option, and a superior benefit-to-risk profile.

Louis ED, Ottman R.

Tremor Other Kyperkinet Mov (NY).

Gerbasi et.al.

Patient experiences in essential tremor:

Mapping functional impacts to existing measures using qualitative research.

TRT Franchise – TLANDO and LPCN 1111 (TLANDO XR)

An Oral Product for Testosterone Replacement Therapy

previously described, under the Verity License Agreement, we granted to Verity in January 2024 an exclusive, royalty-bearing, sublicensable

right and license to develop and commercialize TLANDO, our product for TRT, in the U.S.

and Canada effective February 1, 2024.

received FDA approval on March 28, 2022.

Any FDA requirement to conduct certain post-marketing studies will be the responsibility of

our Licensee, Verity.

Proof-of-concept

for TLANDO was initially established in 2006, and subsequently TLANDO was subsequently licensed in 2009 to Solvay Pharmaceuticals, Inc.,

which was then acquired by Abbott Products, Inc.

Following a portfolio review associated with the spin-off of

by Abbott in 2011, the rights to TLANDO were reacquired by us.

All obligations under the prior license agreement have been

completed except that Lipocine will owe Abbott a perpetual 1% royalty on net sales of TLANDO.

Such royalties are limited to $1 million

in the first 2 calendar years following product launch, after which period there is no cap on royalties and no maximum aggregate amount.

If generic versions of any such product are introduced, then royalties are reduced by 50%.

TLANDO was commercially launched on June 7,

During the three months ended March 31, 2024 and 2023, we incurred royalty expense of approximately $5,000 and $4,000, respectively,

under the Antares license agreement.

TLANDO received full FDA approval, under the terms of the Verity License Agreement, Verity will need to assess the safety and effectiveness

of TLANDO in pediatric patients, as required by the Pediatric Research Equity Act.

The FDA may also require certain post-marketing studies

to be conducted which will also be the responsibility of Verity.

execution of the Verity License Agreement, Verity paid us an initial payment of $2.5 million which was received on signing of the License

Agreement and $5 million which was received on February 1, 2024.

Verity is also required to make an additional payment of $2.5 million

to us before January 1, 2025 and an additional payment of $1 million to us before January 1, 2026.

We are also eligible to receive milestone

payments of up to $259 million in the aggregate, depending on the achievement of certain sales milestones in a single calendar year and/or

development milestones with respect to products licensed by Verity under the Verity License Agreement.

In addition, we will receive tiered

royalty payments at rates ranging from 12% up to 18% of net sales of all products licensed under the Verity License Agreement in the

United States and Canada.

During the three months ended March 31, 2024, we incurred royalty expense of approximately $4,000 under the

Verity license agreement.

are exploring the possibility of licensing LPCN 1021 (known as TLANDO in the United States) to third parties outside the United States

and Canada, although no licensing agreement has been entered into by the Company.

If and when an agreement is made with a partner, such

arrangement would likely be partially contingent upon obtaining local regulatory approval.

No assurance can be given that any license

agreement will be completed or, if an agreement is completed, that such an agreement would be on terms favorable to us.

A Next-Generation Long-Acting Oral Product Candidate for TRT

previously described, under the terms of the Verity License Agreement, we have licensed the development and commercialization rights

to LPCN 1111 (TLANDO XR) in the U.S.

and Canada to Verity.

We will continue to explore the possibility of partnering LPCN 1111 with third

parties outside the United States and Canada, although no partnering agreement has been entered into by the Company.

No assurance can

be given that any license agreement outside North America will be completed, or, if an agreement is completed, that such an agreement

would be on terms favorable to us.

1111 is a next-generation, novel ester prodrug of testosterone comprised of testosterone tridecanoate which uses our proprietary delivery

technology to enhance solubility and improve systemic absorption.

We completed a Phase 2b dose finding study in hypogonadal men in the

third quarter of 2016.

The primary objectives of the Phase 2b clinical study were to determine the starting Phase 3 dose of LPCN 1111

along with safety and tolerability of LPCN 1111 and its metabolites following oral administration of single and multiple doses in hypogonadal

Good dose-response relationship was observed over the tested dose range in the Phase 2b study.

Additionally, the target Phase 3

dose met primary and secondary end points.

Overall, LPCN 1111 was well tolerated with no drug-related severe or serious adverse events

reported in the Phase 2b study.

All future development and commercialization of LPCN 1111 in the U.S.

and Canada will be the responsibility

of our Licensee, Verity.

Pipeline Candidates

continue to pursue opportunities for partnering arrangements for partnering and/or development arrangements for the continued development

and/or marketing of LPCN 1148, LPCN 1144, LPCN 2401, and LPCN 1107.

We do not currently anticipate conducting any further significant

development activities with respect to these products and product candidates without the participation of a partner.

There can be no

guarantee that we will be able to identify or enter into partnering arrangements on terms that are beneficial to us or at all.

we do enter into partnering arrangements, such arrangements may not be sufficient to successfully develop and commercialize these products.

Oral Product Candidate for the Management of Decompensated Cirrhosis

are currently evaluating LPCN 1148 comprising testosterone laurate (“TL”) for the management of decompensated cirrhosis.

We believe LPCN 1148 targets unmet needs for cirrhosis subjects including improvement in the quality of life of patients while on the

liver transplant waiting list, prevention or reduction in the occurrence of new decompensation events such as hepatic encephalopathy

(“HE”), and improvement in post liver transplant survival, including outcomes and costs.

We are exploring the possibility of partnering with a third party for the development and/or marketing of LPCN 1148,

although no partnering agreement has been entered into by the Company.

No assurance can be given that any partnering agreement will be

completed, or, if an agreement is completed, that such an agreement would be on terms favorable to us.

conducted a Phase 2 proof of concept (“POC”) study (NCT04874350) in male subjects with cirrhosis to evaluate the therapeutic

potential of LPCN 1148 for the management of sarcopenia.

The Phase 2 POC study was a prospective, multi-center, randomized, placebo-controlled

study in male sarcopenic cirrhotic patients.

Subjects were initially randomized 1:1 to 1 of 2 arms.

The treatment arm was an oral dose

of LPCN 1148, and the second arm was a matching placebo.

There were no restrictions on patients with respect to background therapies,

including current standard of care, diet or exercise.

The primary endpoint was a change in skeletal muscle index at week 24 with key

secondary endpoints including change in liver frailty index, rates of breakthrough HE, and number of waitlist events, including all-cause

Total treatment was 52 weeks, with 24-week placebo-controlled treatment subjects receiving LPCN 1148 in the 28-week open-label

extension (“OLE”) phase of the study for the duration of the study through week 52.

July 2023 we announced that the Phase 2 study met the study primary endpoint, increased skeletal muscle index (L3-SMI) relative to placebo

(P<.01), in patients with cirrhosis.

The study also demonstrated improvements in clinical outcomes such as prevention of new decompensation

events including HE, rates of hospitalizations, and patient reported outcomes (“PROs”).

LPCN 1148 was well-tolerated, with

adverse event (“AE”) rates and severities similar to placebo and no mortality was noted in the LPCN 1148 treatment group,

nor were there any cases of drug-induced liver injury.

March 2024 we announced that 24-week L3-SMI increases were maintained through 52 weeks of LPCN 1148 intervention and that placebo patients

who switched to LPCN 1148 in the open label extension period of the study had increases in L3-SMI.

Furthermore, fewer overt hepatic encephalopathy

(“OHE”) events were observed in LPCN 1148 treated patients and time to first recurrent OHE event was longer for treated patients.

LPCN 1148 was well-tolerated, with AE rates and severities similar to placebo and fewer participants experienced serious or sever adverse

events when switched from placebo to LPCN 1148 and patients on therapy were hospitalized for fewer days.

We plan to request a Type C

meeting with the FDA to discuss the clinical development plan for LPCN 1148 in mid-2024.

Overview – Cirrhosis

are over 2 million cases of cirrhosis worldwide, with over 500,000 people living with decompensated cirrhosis in the U.S.

Non-alcoholic

fatty liver disease is the most rapidly increasing indication for liver transplant.

62% of those on the liver transplant (“LT”)

waitlist are male and the economic burden (approximately $812,500/transplant) is high and continues to increase.

Each year about half

of the approximately 17,000 people in U.S.

on the LT waitlist undergo transplant, while nearly 3,000 patients either die or are removed

from the list because they were “too sick to transplant.”

cirrhosis is defined as the histological development of regenerative nodules surrounded by fibrous bands.

Patients with cirrhosis typically

have a years-long silent, asymptomatic phase (compensated cirrhosis) until decreasing liver function and increasing portal pressure move

the patient into the symptomatic phase (decompensated cirrhosis).

Transition to decompensated cirrhosis is marked by clinical events

including ascites, encephalopathy, jaundice, and/or variceal hemorrhage.

Decompensated subjects survive on average less than 2 years.

Common causes of liver cirrhosis include alcoholic liver disease, non-alcoholic fatty liver disease (“NAFLD”), chronic hepatitis

B and C, primary biliary cirrhosis (“PBC”), and primary sclerosing cholangitis (“PSC”) and some patients have

liver disease of unknown cause (cryptogenic).

complications in patients with cirrhosis may include:

compromised liver function, portal hypertension, varices in GI tract with internal

bleeding, edema, ascites, hepatic encephalopathy, compromised immunity with post-transplant acute rejection risk, high sodium levels,

increased bilirubin, low albumin level, insulin resistance with impaired peripheral uptake of glucose, depression, accelerated muscle

disorder in the form of sarcopenia, myosteatosis, and frailty with compromised energetics, bone diseases (e.g., osteoporosis), high alkaline

phosphatase (“ALP”), cachexia, malnutrition, weight loss (>5%), symptoms of hypogonadism such as abnormal hair distribution,

anemia, sexual dysfunction, testicular atrophy, muscle wasting, fatigue, osteoporosis, gynecomastia, inflammation with elevated cytokines,

and infection risk leading to hospital admissions and possibly death.

a significant decompensation event in patients with cirrhosis, is a brain dysfunction caused by liver insufficiency and/or portal systemic

Because the damaged liver cannot function normally (as in cirrhosis), neurotoxins such as ammonia are inadequately removed

from systemic circulation and travel to the brain, where they affect neurotransmission.

This can cause episodes of HE, which may present

as alterations in consciousness, cognition, and behavior that range from minimal to severe.

Overt HE occurs in 30% to 40% of patients

with cirrhosis at some point during the clinical course of their disease.

As the burden of chronic liver disease and cirrhosis is increasing,

the frequency of HE is also increasing.

An Oral Prodrug of Bioidentical Testosterone Product Candidate for the Treatment of NASH

are exploring the possibility of partnering with a third party for LPCN 1144, although no partnering agreement has been entered into

by the Company.

No assurance can be given that any license agreement will be completed, or, if an agreement is completed, that such an

agreement would be on terms favorable to us.

Overview – NASH

is an advanced state of non-alcoholic fatty liver disease (“NAFLD”) that can progress to a cirrhotic liver or liver failure,

require liver transplant, and can result in hepatocellular carcinoma/ liver cancer, and death.

Progression of NASH to end stage liver

disease is one of the leading causes of liver failure requiring liver transplantation.

Importantly, beyond these critical conditions,

NASH and NAFLD patients additionally suffer heightened cardiovascular risk and die more frequently from cardiovascular events than from

liver disease.

NAFLD/NASH is becoming more common due to its strong correlation with obesity and metabolic syndrome, including components

of metabolic syndrome such as diabetes, cardiovascular disease and high blood pressure.

20% to 30% of the U.S.

population is estimated

to suffer from NAFLD, with a large proportion of that group, 15% to 20%, progressing to NASH, which lacks an effective therapy.

is a silent killer that affects millions in the U.S.

Diagnoses have been on the rise and are expected to increase dramatically in the

Approximately 50% of NASH patients are adult males.

In men, especially with comorbidities associated with NAFLD/NASH, testosterone

deficiency has been associated with an increased accumulation of visceral adipose tissue and insulin resistance, which could be factors

contributing to NAFLD/NASH.

There is currently no approved therapy for the treatment of NASH although there are several drug candidates

currently under development with many having clinical failures to date.

critical pathophysiologic mechanisms underlying the development and progression of NASH include reduced ability to handle lipids, increased

insulin resistance, injury to hepatocytes and liver fibrosis in response to hepatocyte injury.

NASH patients have an excessive accumulation

of fat in the liver resulting primarily from a caloric intake above and beyond energy needs.

A healthy liver contains less than 5% fat,

but a liver in someone with NASH can contain more than 20% fat.

This abnormal liver fat contributes to the progression to NASH, a liver

necro-inflammatory state that can lead to scarring, also known as fibrosis, and, for some, can progress to cirrhosis and liver failure.

have completed the LiFT Phase 2 clinical study in biopsy-confirmed non-cirrhotic NASH subjects.

The LiFT clinical study

was a prospective, multi-center, randomized, double-blind, placebo-controlled multiple-arm study in biopsy-confirmed hypogonadal and

eugonadal male NASH subjects with grade F1-F3 fibrosis and a target NAFLD Activity Score ≥ 4 with a 36-week treatment period.

LiFT clinical study enrolled 56 biopsy confirmed NASH male subjects.

Subjects were randomized 1:1:1 to one of three arms (Treatment

A was a twice daily oral dose of 142 mg testosterone equivalent, Treatment B was a twice daily oral dose of 142 mg testosterone equivalent

formulated with 217 mg of d-alpha tocopherol equivalent, and the third arm was a twice daily matching placebo).

primary endpoint of the LiFT clinical study was change in hepatic fat fraction via MRI-PDFF and exploratory liver fat/marker end

points post 12 weeks of treatment.

Additionally, key secondary endpoints post 36 weeks of treatment included assessment of histological

change for NASH resolution and/or fibrosis improvement (biopsy) as well as liver fat data (MRI-PDFF).

The LiFT clinical study

was not powered to assess statistical significance of any of the secondary endpoints.

Other important endpoints included the following:

change in liver injury markers, anthropomorphic measurements, lipids, insulin resistance and inflammatory/fibrosis markers;

patient reported outcomes.

with LPCN 1144 post 12 weeks of treatment in the LiFT study resulted in robust liver fat reduction, assessed by MRI-PDFF, and

showed improvement of liver injury markers with no observed tolerability issues.

biopsies were performed at baseline (“BL”) and after 36 weeks of treatment (“EOS”).

Pre-specified biopsy analyses

included NASH Clinical Research Network (“CRN”) scoring as well as a continuous paired (“Paired Technique”) and

digital technique (“Digital Technique-Fibronest”).

All biopsy analyses were performed on the same slides and the reads for

the three techniques were done independently.

Analysis sets included the NASH Resolution Set (all subjects that have BL and EOS biopsy

with NASH at BL [NAS ≥4 with lobular inflammation score ≥ 1 and hepatocyte ballooning score ≥1 at BL] (n=37)), the Biopsy Set

(all subjects with baseline and EOS biopsies (n=44)), and the Safety Set (all randomized subjects (n=56)).

LPCN 1144 treatment arms met with statistical significance the pre-specified accelerated approval regulatory endpoint of NASH resolution

with no worsening of fibrosis based on NASH CRN scoring.

Additionally, both treatment arms showed substantial improvement of the observed

NASH activity in steatosis, inflammation, and ballooning.

the 36 weeks of treatment, LPCN 1144 was well tolerated with an overall safety profile comparable to placebo.

Additionally, subjects

were given the option to have access to LPCN 1144 through an open label extension (“OLE”) study.

The extension study enabled

the collection of additional data on LPCN 1144 for up to a total of 72 weeks of therapy, as well as data for 36 weeks of therapy for

those subjects on placebo in the LiFT study.

Key results from the OLE study are as follows:

1144 was well tolerated over 72-week exposure with no observed safety signals;

injury markers were reduced and maintained with extended LPCN 1144 treatment;

liver histology improvements support further development.

November 2021, the FDA granted Fast Track Designation to LPCN 1144 as a treatment for non-cirrhotic NASH.

The Fast Track program is designed

to accelerate the development and expedite the review of products, such as LPCN 1144, which are intended to treat serious diseases and

for which there is an unmet medical need.

had a written only response from the FDA for a LPCN 1144 Type C meeting with the FDA in January 2022 to discuss the development path

forward with LPCN 1144.

The FDA acknowledged that the NDA submission of LPCN 1144 would be via the 505(b)2 regulatory pathway and agreed

that no additional non-clinical studies are needed to support an NDA submission.

The FDA acknowledged that subjects in the LiFT study

subjects achieved improvements in key components associated with NASH histopathology after 36-weeks of treatment with LPCN 1144 in adult

males and agreed that the proposed multicomponent primary surrogate endpoint is acceptable for seeking approval under the accelerated

approval pathway.

The FDA agreed that the proposed primary multicomponent surrogate endpoint, NASH resolution with no worsening of fibrosis,

is acceptable for seeking approval under the accelerated approval pathway and the FDA recommended a Phase 3 trial with a study duration

In July 2022, Lipocine held an End of Phase 2 meeting with the FDA for LPCN 1144 for NASH.

The FDA recommended a Phase 2

dose ranging study be conducted to identify the optimal dose prior to conducting a pivotal study.

The FDA agreed to the proposed unique

testosterone ester, testosterone laurate, for future clinical studies.

An Adjunct Therapy to Incretin Mimetics, as an Aid for Improved Body Composition in Chronic Weight Management

2401 is an oral formulation of a proprietary combination of anabolic androgen receptor agonist and α-alpha tocopherol, an antioxidant

metabolic modifier.

Data from preclinical and clinical studies support the potential of LPCN 2401 in gaining lean mass while losing fat

As an adjunct therapy to incretin mimetics, LPCN 2401 has the potential to attenuate weight rebound, ameliorate loss of muscle

mass, improve muscle quality and functionality, amplify fat mass loss with improved body composition, maintain weight, prevent “fat

overshoot,” and accelerate muscle rebound post incretin mimetic discontinuation.

We plan to request a meeting with the FDA to discuss

the study design for a proof-of-concept phase 2 study for LPCN 2401.

We may explore the possibility of partnering with a third party,

although no partnering agreement has been entered into by the Company.

No assurance can be given that any license agreement will be completed,

or, if an agreement is completed, that such an agreement would be on terms favorable to us.

Overview – Obesity Management

Approximately

74% of US adults age 20 and older are either obese or overweight, and an estimated 30% of the US adult population has a BMI ≥ 30 kg/m 2 .

Obesity is a chronic, relapsing health risk defined by excess body fat.

Excess body fat increases the risk of death and major comorbidities

such as type 2 diabetes, hypertension, dyslipidemia, cardiovascular disease, osteoarthritis of the knee, sleep apnea, and some cancers

(Caterson and Hubbard et al.

Calle and Thun et al.

Reportedly, ~24M (Flynn et al.

Morgan Stanley, February 27, 2024) obese

elderly are most vulnerable to losing muscle mass.

rapid weight loss observed with the approved weight management medications includes unwanted lean mass loss, up to 40% of the patient’s

total weight lost.

Moreover, discontinuation of these therapies frequently results in a rapid regain in weight.

Loss of lean mass has

multiple negative health implications including weakness/fatigue, lowered metabolism which can cause a regain in fat mass, declines in

neuromuscular function, potential effects on emotion and psychological states, and increased risk of injury.

recent studies showed that body composition, especially lean body mass (muscle) may play an independent role in survival of patients

with diseases such as cancer and cardiovascular diseases (DH Lee and EL Giovannucci, Exp Biol Med.

Therefore, a focus on body

composition in obesity management to sustainably lose fat mass while maintaining lean mass should be an essential goal.

is a significant unmet need for an oral, efficacious, muscle preserving/gaining option for chronic obesity/weight management that ameliorates

the loss of LM associated with GLP-1/GIP agonist treatment, resulting in a higher quality weight loss.

Moreover, there is a need for

a chronic long-term pharmacotherapy option to maintain weight upon cessation of incretin mimetic therapy, prevent fat/weight rebound

“overshoot” and minimize lag in muscle recovery to prevent collateral fattening.

An Oral Product Candidate for the Prevention of Preterm Birth

are exploring the possibility of partnering with a third party for the development and/or marketing of LPCN 1107, although no partnering

agreement has been entered into by the Company.

No assurance can be given that any partnering agreement will be completed, or, if an

agreement is completed, that such an agreement would be on terms favorable to us.

believe LPCN 1107 has the potential to become the first oral hydroxyprogesterone caproate (“HPC”) product indicated for the

reduction of risk of PTB (delivery less than 37 weeks) in women with singleton pregnancy who have a history of singleton spontaneous

Prevention of PTB is a significant unmet need as approximately 11% of all U.S.

pregnancies result in PTB, a leading cause of neonatal

mortality and morbidity.

have completed a multi-dose PK dose selection study in pregnant women.

The objective of the multi-dose PK selection study was to assess

HPC blood levels in order to identify the appropriate LPCN 1107 Phase 3 dose.

The multi-dose PK dose selection study was an open-label,

4-period, 4-treatment, randomized, single and multiple dose PK study in pregnant women with 3 dose levels of LPCN 1107 and the IM HPC

The study enrolled 12 healthy pregnant women (average age of 27 years) with a gestational age of approximately 16 to 19

Subjects received three dose levels of LPCN 1107 (400 mg BID, 600 mg BID, or 800 mg BID) in a randomized, crossover manner during

the first 3 treatment periods and then received 5 weekly injections of HPC during the fourth treatment period.

During each of the LPCN

1107 treatment periods, subjects received a single dose of LPCN 1107 on Day 1 followed by twice daily administration from Day 2 to Day

Following completion of the 3 LPCN 1107 treatment periods and a washout period, all subjects received 5 weekly injections of HPC.

Results from this study demonstrated that average steady state HPC levels (Cavg0-24) were comparable or higher for all 3 LPCN 1107 doses

than for injectable HPC.

Additionally, HPC levels as a function of daily dose were linear for the 3 LPCN 1107 doses.

Also, unlike the

injectable HPC, steady state exposure was achieved for all 3 LPCN 1107 doses within 7 days.

traditional PK/PD based Phase 2 clinical study in the intended patient population is not expected to be required prior to entering into

Therefore, based on the results of our multi-dose PK study we had an End-of-Phase 2 meeting and subsequent guidance meetings

with the FDA to define a pivotal Phase 2b/3 development plan for LPCN 1107.

However, these discussions may be updated based on recent

developments with Covis’ Makena® as described below.

We have completed a food effect study to characterize the dosing regimen

for the pivotal study and we have submitted a pivotal clinical study protocol to the FDA.

FDA has granted orphan drug designation to LPCN 1107 based on a major contribution to patient care.

Orphan designation qualifies Lipocine

for various development incentives, including tax credits for qualified clinical testing, and a waiver of the prescription drug user

fee when we file our NDA.

Competition Update

October 5, 2020, the FDA’s Center for Drug Evaluation and Research (“CDER”) proposed that Makena be withdrawn from

the market because the PROLONG trial failed to verify the clinical benefit of Makena and concluded that the available evidence does not

show Makena is effective for its approved use.

CDER issued AMAG Pharmaceuticals, the NDA holder at the time, a Notice of Opportunity for Hearing (“NOOH”) to withdraw approval

of Makena, for which AMAG Pharmaceuticals responded by requesting a hearing and providing detail on the company’s position, recognizing

clinicians’ decade-long use of treatment with Makena and the public health implications of withdrawing approval.

The FDA Commissioner

held a public hearing with Covis from October 17 through 19, 2022, which resulted in a 14-1 vote recommending removal of the product

from the market.

On October 31, 2022, Covis approached the CDER and outlined a plan of orderly withdrawal which would set a withdrawal

timeframe sufficient for current patients to complete their courses of treatment.

The CDER declined this proposal.

On March 6, 2023,

Covis announced its plan to voluntarily withdraw Makena from the market and submitted a request to the CDER for a minimum 21-week wind-down.

On April 6, 2023, the FDA withdrew its approval of Makena and ordered the immediate withdrawal of Makena and several approved generic

versions of the drug, making it unlawful for the drug to be distributed in the U.S.

The FDA stated that in light of the unmet need for

a treatment for preventing preterm birth and improving neonatal outcomes, it is imperative that the medical and scientific communities

increase their efforts to find effective treatments and stated their hope that the decision to withdraw Makena will help galvanize further

The FDA further stated their commitment to working together with patients, researchers, and drug developers to advance the

development of safe and effective therapies that are urgently needed as a treatment for the prevention of preterm birth.

Operations Overview

date, we have not generated any revenues from product sales and do not expect to do so until one of our product candidates receives approval

from the FDA.

Revenues to date have been generated substantially from license fees, royalty and milestone payments and research support

from our licensees.

Since our inception through March 31, 2024, we have generated $49.5 million in revenue under our various license

and collaboration arrangements and from government grants.

We have entered into the Verity License Agreement with the potential for revenue

from future milestones and royalties, but we may never generate revenues from any of our clinical or preclinical development programs

or licensed products as we may never succeed in obtaining regulatory approval or commercializing any of these product candidates.

and Development Expenses

and development expenses consist primarily of salaries, benefits, stock-based compensation and related personnel costs, fees paid to

external service providers such as contract research organizations and contract manufacturing organizations, contractual obligations

for clinical development, clinical sites, manufacturing and scale-up for late stage clinical trials, formulation of clinical drug supplies,

and expenses associated with regulatory submissions.

Research and development expenses also include an allocation of indirect costs,

such as those for facilities, office expense, and depreciation of equipment based on the ratio of direct labor hours for research and

development personnel to total direct labor hours for all personnel.

We expense research and development expenses as incurred.

our inception, we have spent approximately $150.1 million in research and development expenses through March 31, 2024.

expect to continue to incur significant costs as we develop our other product candidates, including our CNS product candidates and the

wind down of the Phase 2 POC study in male subjects with cirrhosis with LPCN 1148, as well as the development of any future pipeline

product candidates.

general, the cost of clinical trials may vary significantly over the life of a project as a result of uncertainties in clinical development,

including, among others:

number of sites included in the trials;

length of time required to enroll suitable subjects;

duration of subject follow-ups;

length of time required to collect, analyze and report trial results;

cost, timing and outcome of regulatory review;

changes by the FDA in clinical trial and NDA filing requirements.

research and development expenditures are subject to numerous uncertainties regarding timing and cost to completion, including, among

timing and outcome of regulatory filings and FDA reviews and actions for product candidates;

dependence on third-party manufacturers for the production of satisfactory finished products

for registration and launch should regulatory approval be obtained on any of our product

potential for future license or co-promote arrangements for our product candidates, when

such arrangements will be secured, if at all, and to what degree such arrangements would

affect our future plans and capital requirements;

effect on our product development activities of actions taken by the FDA or other regulatory

change of outcome for any of these variables with respect to the development of our product development candidates could mean a substantial

change in the costs and timing associated with these efforts, could require us to raise additional capital, and may require us to reduce

the stage of clinical development and the significant risks and uncertainties inherent in the clinical development, manufacturing, and

regulatory approval process, we are unable to estimate with any certainty the time or cost to complete the development of LPCN 1154,

LPCN 2101, LPCN 2203, LPCN 2401, LPCN 1148, LPCN 1144, LPCN 1111, LPCN 1107 and other product candidates.

Clinical development timelines,

the probability of success, and development costs can differ materially from expectations and results from our clinical trials may not

be favorable.

If we are successful in progressing LPCN 1154, LPCN 2101, LPCN 2203 or other future product candidates into later stage

development, we will require additional capital.

The amount and timing of our future research and development expenses for these product

candidates will depend on the pre-clinical and clinical success of both our current development activities and potential development

of new product candidates, as well as ongoing assessments of the commercial potential of such activities.

We will continue efforts to

enter into partnership arrangements for the continued development and/or marketing of LPCN 1144, LPCN 1148, LPCN 2401, LPCN 1107 and

TLANDO and LPCN 1111 outside of North America.

expect to continue to incur significant research and development expenses in the future as we complete on-going clinical studies, including

the studies for our CNS product candidates and as we conduct future clinical studies, including when and if we conduct Phase 2 clinical

studies with our development product candidates and when and if we conduct Phase 3 clinical studies with LPCN 1144, LPCN 1148, and LPCN

We are also exploring the possibility of licensing LPCN 1144, LPCN 1148, LPCN 2401 and LPCN 1107, although we have not entered

into a licensing agreement and no assurance can be given that any license agreement will be completed, or, if an agreement is completed,

that such an agreement would be on terms favorable to us.

If we are unable to raise additional capital or obtain non-dilutive financing,

we may need to reduce research and development expenses in order to extend our ability to continue as a going concern.

and Administrative Expenses

and administrative expenses consist primarily of salaries and related benefits, including stock-based compensation related to our executive,

finance, business development and administrative support functions.

Other general and administrative expenses include rent and utilities,

travel expenses, and professional fees for auditing, tax, legal, and various other services.

and administrative expenses also include expenses for the cost of preparing, filling and prosecuting patent applications and maintaining,

enforcing and defending intellectual property-related claims.

expect that general and administrative expenses will increase in the future as we continue as a public company.

These fees include legal

and consulting fees, accounting and audit fees, director fees, directors’ and officers’ insurance premiums, fees for investor

relations services and enhanced business and accounting systems, litigation costs, professional fees and other costs.

However, if we

are unable to raise additional capital, we may need to reduce general and administrative expenses in order to extend our ability to continue

as a going concern.

Income and Expense

income and expense consists primarily of interest income earned on our cash, cash equivalents and marketable investment securities, imputed

interest on minimum royalties under the Antares Licensing Agreement in 2023, and losses (gains) on our warrant liability.

of Operations

of the Three Months Ended March 31, 2024

following table summarizes our results of operations for the three months ended March 31, 2024 and 2023:

Months Ended March 31,

Research and development expenses

General and administrative

Interest and investment income

Unrealized gain (loss) on

warrant liability

Income tax expense

recognized revenue of $7.6 million primarily consisting of licensing revenue received from our Verity License Agreement during the three

months ended March 31, 2024, and revenue of $55,000 in licensing revenue during the three months ended March 31, 2023, respectively.

and Development Expenses

decrease in research and development expenses during the three months ended March 31, 2024, as compared to the three months ended March

31, 2023 consists of an $853,000 decrease in contract research organization expense and outside consulting costs related to the completion

of our LPCN 1148 study in 2023, a $89,000 decrease in personnel related costs, a $60,000 decrease in LPCN 1111 costs, offset by a $542,000

increase in costs related to our LPCN 1154 clinical studies, a $128,00 increase in TLANDO manufacturing related costs, and a $44,000

increase in other research and development related costs.

and Administrative Expenses

increase in general and administrative expenses during the three months ended March 31, 2024 as compared to the three months ended March

31, 2023 consists of a $521,000 increase in business development expenses and a $39,000 increase in other various general and administrative

These increases are offset by a $115,000 decrease in various administrative consulting fees, an $83,000 decrease in corporate

insurance expense, a $43,000 decrease in personnel salaries and benefits, and a $31,000 decrease in legal fees.

and Investment Income

decrease in interest and investment income during the three months ended March 31, 2024 compared to interest and investment income during

the three months ended March 31, 2023 was due to lower cash and marketable investment securities balances, in addition to no longer having

imputed interest on the Antares License Agreement contract asset in the three months ended March 31, 2024.

on Warrant Liability

recorded a loss of approximately $40,000 and a gain of approximately $98,000 on warrant liability during the three months ended March

31, 2024 and 2023, respectively, related to the change in the fair value of outstanding common stock warrants issued in the November

2019 Offering.

The loss in 2024 resulted from an increase in the fair value of warrants mainly due to a higher stock price at the end

of the first quarter of 2024 compared to the stock price at the end of the fourth quarter of 2023.

The gain in 2023 was attributable

to a decrease in the fair value of warrants outstanding as of March 31, 2023 as compared to December 31, 2022, primarily due to the decrease

in our stock price at the end of the first quarter 2023 compared to the stock price at the end of the fourth quarter of 2022, in addition

to higher interest rates.

No common stock warrants from the November 2019 Offering were exercised during the three months ended March

31, 2024 or the three months ended March 31, 2023.

The warrants are classified as a liability due to a provision contained within the

warrant agreement which allows the warrant holder the option to elect to receive an amount of cash equal to the value of the warrants

as determined in accordance with the Black-Scholes option pricing model with certain defined assumptions upon a change of control.

warrant liability will continue to fluctuate in the future based on inputs to the Black-Scholes model including our current stock price,

the remaining life of the warrants, the volatility of our stock price, the risk-free interest rate and the number of common stock warrants

and Capital Resources

our inception, our operations have been primarily financed through sales of our equity securities, debt and payments received under our

license and collaboration arrangements.

We have devoted our resources to funding research and development programs, including discovery

research, preclinical and clinical development activities.

We have incurred operating losses in most years since our inception and we

expect to continue to incur operating losses into the foreseeable future as we advance the clinical development of LPCN 1154, LPCN 2101,

LPCN 2203, LPCN 2401 and any other future product candidates, including continued research efforts.

of March 31, 2024, we had $24.6 million of unrestricted cash, cash equivalents and marketable investment securities compared to $22.0

million at December 31, 2023.

January 12, 2024, we entered into the Verity License Agreement with Verity, pursuant to which we granted to Verity an exclusive, royalty-bearing,

sublicensable right and license to develop and commercialize our TLANDO product with respect to TRT in the U.S.

Upon execution

of the Verity License Agreement in January 2024 and upon transition of the commercialization of TLANDO from Antares to Verity in February

2024, Verity paid to us initial payments of $2.5 million and $5 million, respectively.

Verity has also agreed to make additional payments

to us of $2.5 million before January 1, 2025, and $1 million before January 1, 2026.

The Verity License Agreement also provides Verity

with a license to develop and commercialize TLANDO XR (LPCN 1111), the Company’s potential next generation, once daily oral product

candidate for testosterone replacement therapy comprised of testosterone tridecanoate (“TT”) in the U.S.

also eligible to receive milestone payments of up to $259 million in the aggregate, depending on the achievement of certain development

milestones and sales milestones in a single calendar year with respect to all products licensed by Verity under the Verity License Agreement.

In addition, we receive tiered royalty payments at rates ranging from 12% up to 18% of net sales of all products licensed to Verity in

the United States and Canada.

Our ability to realize benefits from the Verity License Agreement, including milestone and royalty payments,

is subject to a number of risks.

We may not realize milestone or royalty payments in anticipated amounts, or at all.

March 6, 2017, we entered into a sales agreement (“Sales Agreement”) with Cantor Fitzgerald & Co.

pursuant to which we sold shares of our common stock, having registered up to $50.0 million for sale under the Sales Agreement, pursuant

to our Registration Statement on Form S-3 (the “Form S-3”), through Cantor as our sales agent.

We were not obligated to make

any sales of our common stock under the Sales Agreement.

During the three months ended March 31, 2024, we did not sell any shares of

our common stock under the Sales Agreement.

Since March 6, 2017 and as of March 31, 2024, we had sold 964,711 shares of our common stock

for $33.3 million pursuant to the Sales Agreement and had approximately $40.8 million available for sale under the Sales Agreement.

offering of our common stock pursuant to the Sales Agreement could terminate upon the termination of the Sales Agreement as permitted

therein at any time upon ten days’ prior notice, and on April 24, 2024, the Company terminated the Sales Agreement with Cantor.

On April 26, 2024, the Company entered into a sales agreement with A.G.P.

Sales Agreement”) pursuant to which

the Company may issue and sell, from time to time, shares of its common stock having an aggregate offering price of up to the amount

the Company registered on an effective registration statement pursuant to which the offering is being made.

The Company currently has

registered $10,616,169 shares of common shares for sale under the Sales Agreement, pursuant to the Registration Statement on Form S-3,

as amended (File No.

333-275716) (the “Form S-3”), through A.G.P.

as the Company’s sales agent.

Company’s common stock by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4)

of the Securities Act, including sales made directly on or through the Nasdaq Capital Market or any other existing trade market for our

common stock, in negotiated transactions at market prices prevailing at the time of sale or at prices related to prevailing market prices,

or any other method permitted by law.

will use its commercially reasonable efforts consistent with its normal trading and sales

practices and applicable law and regulations to sell shares under the A.G.P.

Sales Agreement.

The Company will pay A.G.P.

aggregate gross proceeds from each sale of shares under the A.G.P.

Sales Agreement.

In addition, the Company has also provided A.G.P.

with customary indemnification rights.

shares of the Company’s common stock to be sold under the A.G.P.

Sales Agreement will be sold and issued pursuant to the Form S-3,

as amended, which was previously declared effective by the Securities and Exchange Commission, and the related prospectus and one or

more prospectus supplements.

Company is not obligated to make any sales of its common stock under the A.G.P.

Sales Agreement.

The offering of common stock pursuant

to the A.G.P.

Sales Agreement will terminate upon the termination of the A.G.P.

Sales Agreement as permitted therein.

The Company and

may each terminate the A.G.P.

Sales Agreement at any time upon ten days’ prior notice.

believe that our existing capital resources, together with interest thereon, will be sufficient to meet our projected operating requirements

through at least May 9, 2025 which include on-going clinical studies for LPCN 1154, and/or LPCN 2101 and research and development activities

and compliance with regulatory requirements.

We have based this estimate on assumptions that may prove to be wrong, and we could utilize

our available capital resources sooner than we currently expect if additional activities are performed by us including new clinical studies

for LPCN 2203, LPCN 1148, LPCN 1144, LPCN 2401, LPCN 1111, and/or LPCN 1107.

While we believe we have sufficient liquidity and capital

resources to fund our projected operating requirements through at least May 9, 2025, we will need to raise additional capital at some

point through the equity or debt markets or through additional out-licensing activities, either before or after May 9, 2025, to support

our operations.

If we are unsuccessful in raising additional capital as necessary, our ability to continue as a going concern will be

Further, our operating plan may change, and we may need additional funds to meet operational needs and capital requirements

for product development, regulatory compliance and clinical trial activities sooner than planned.

In addition, our capital resources

may be consumed more rapidly if we pursue additional clinical studies for LPCN 1154, LPCN 2101, LPCN 2203, LPCN 2401, LPCN 1148, LPCN

1144, and/or LPCN 1107.

Conversely, our capital resources could last longer if we reduce expenses, reduce the number of activities currently

contemplated under our operating plan or if we terminate, modify or suspend on-going clinical studies.

We can raise capital pursuant

to the A.G.P.

Sales Agreement but may choose not to issue common stock if our market price is too low to justify such sales in our discretion.

There are numerous risks and uncertainties associated with the development and, subject to approval by the FDA, commercialization of

our product candidates.

There are numerous risks and uncertainties impacting our ability to enter into collaborations with third parties

to participate in the development and potential commercialization of our product candidates.

We are unable to precisely estimate the

amounts of increased capital outlays and operating expenditures associated with our anticipated or unanticipated clinical studies and

ongoing development efforts.

All of these factors affect our need for additional capital resources.

To fund future operations, we will

need to ultimately raise additional capital and our requirements will depend on many factors, including the following:

scope, rate of progress, results and cost of our clinical studies, pre-clinical testing and

other related activities for all of our product candidates, including LPCN 1154, LPCN 2101

LPCN 2203, LPCN 2401, LPCN 1148, LPCN 1144, and LPCN 1107;

cost of manufacturing clinical supplies and establishing commercial supplies, of our product

candidates and any products that we may develop;

cost and timing of establishing sales, marketing and distribution capabilities, if any;

terms and timing of any collaborative, licensing, settlement and other arrangements that

we may establish;

number and characteristics of product candidates that we pursue;

cost, timing and outcomes of regulatory approvals;

timing, receipt and amount of sales, profit sharing, milestones or royalties, if any, from

our potential products;

cost of preparing, filing, prosecuting, defending and enforcing any patent claims and other

intellectual property rights;

extent to which we acquire or invest in businesses, products or technologies, although we

currently have no commitments or agreements relating to any of these types of transactions;

extent to which we grow significantly in the number of employees or the scope of our operations.

may not be available to us on favorable terms, or at all.

Also, market conditions may prevent us from accessing the debt and equity capital

markets, including sales of our common stock through the Sales Agreement.

If we are unable to obtain adequate financing when needed,

we may have to delay, reduce the scope of or suspend one or more of our clinical studies, research and development programs or, if any

of our product candidates receive approval from the FDA, commercialization efforts.

We may seek to raise any necessary additional capital

through a combination of public or private equity offerings, including the Sales Agreement, debt financings, collaborations, strategic

alliances, licensing arrangements and other marketing and distribution arrangements.

These arrangements may not be available to us or

available on terms favorable to us.

To the extent that we raise additional capital through marketing and distribution arrangements, other

collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our product

candidates, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us.

If we do raise additional capital through public or private equity offerings, the ownership interest of our existing stockholders will

be diluted, and the terms of these securities may include liquidation or other preferences, warrants or other terms that adversely affect

our stockholders’ rights or further complicate raising additional capital in the future.

If we raise additional capital through

debt financing, we may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional

debt, making capital expenditures or declaring dividends.

If we are unable, for any reason, to raise needed capital, we will have to

reduce costs, delay research and development programs, liquidate assets, dispose of rights, commercialize products or product candidates

earlier than planned or on less favorable terms than desired or reduce or cease operations.

and Uses of Cash

following table provides a summary of our cash flows for the three months ended March 31, 2024 and 2023:

Months Ended March 31,

Cash provided

by (used in) operating activities

$ (3,928,057 )

Cash provided by (used in)

investing activities

Cash used in financing activities

Cash from Operating Activities

the three months ended March 31, 2024, net cash provided by operating activities was $2.4 million and during the three months ended March

31, 2023, net cash used in operating activities was $3.9 million.

cash provided by operating activities during the three months ended March 31, 2024, was primarily attributable to cash inflow from the

Verity License Agreement of $7.5 million which exceeded cash required to support ongoing operations, including research and development

expenses and general and administrative expenses of $4.4 million.

Net cash used in operating activities during the three months ended

March 31, 2023, was mainly attributable to activities primarily related to our Phase 2 POC study in male subjects with cirrhosis with

LPCN 1148 and clinical studies related to LPCN 1154.

Cash from Investing Activities

the three months ended March 31, 2024, net cash used in investing activities was $4.1 million and during the three months ended March

31, 2023, net cash provided by investing activities was $5.6 million.

cash used in investing activities during the three months ended March 31, 2024, was primarily the result of purchases of marketable

investments securities, net of $4.1 million.

Net cash provided by investment activities for the three months ended March 31, 2023,

was primarily the result of the maturity of marketable investment securities, net of $5.6 million.

There were no capital

expenditures during the three months ended March 31, 2024, and approximately $4,000 in capital expenditures during the three months

ended March 31, 2023.

Cash from Financing Activities

the three months ended March 31, 2024 and 2023, net cash used in financing activities was approximately $8,000 and $6,000, respectively.

cash used in financing activities during the three months ended March 31, 2024 and 2023 was related to costs associated with our ATM

offering with Cantor.

Commitments and Contingencies

enter into contracts and issue purchase orders in the normal course of business with clinical research organizations for clinical trials

and clinical and commercial supply manufacturing and with vendors for pre-clinical research studies, research supplies and other services

and products for operating purposes.

These contracts generally provide for termination on notice and are cancellable obligations.

August 2004, we entered into an agreement to lease our facility in Salt Lake City, Utah consisting of office and laboratory space which

serves as our corporate headquarters.

On January 24, 2024, we modified and extended the lease through February 28, 2025.

Accounting Policies and Significant Judgments and Estimates

management’s discussion and analysis of our financial condition and results of operations is based on our financial statements

which we have prepared in accordance with U.S.

generally accepted accounting principles (US GAAP).

In preparing our financial statements, we

are required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of

contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during

the reporting periods.

Our estimates are based on our historical experience and on various other factors that we believe are

reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and

liabilities that are not readily apparent from other sources.

Actual results may differ from these estimates under different

assumptions or conditions.

We concluded that licensing revenue recognized in conjunction with the Verity License Agreement met the requirements

under ASC 606, Revenue from Contracts with Customers.

We evaluate the measure of progress each reporting period and, if necessary, adjust

the measure of performance and related revenue recognition.

License revenue from payments to be received in the future will be recognized

when it is probable that we will receive license payments under the terms of the Verity License Agreement.

There have been no significant and material changes in our critical accounting policies during the three

months ended March 31, 2024, as compared to those disclosed in “Management’s Discussion and Analysis of Financial

Condition and Results of Operations-Critical Accounting Policies and Significant Judgments and Estimates” in our Form 10-K

filed March 7, 2024.

Standards Issued Not Adopted

November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07, Segment Reporting (Topic

Improvements to Reportable Segment Disclosures, which enhances reporting requirements under Topic 280.

The enhanced disclosure

requirements include:

title and position of the Chief Operating Decision Maker (CODM), significant segment expenses provided to the CODM,

extending certain annual disclosures to interim periods, clarifying single reportable segment entities must apply ASC 280 in its entirety,

and permitting more than one measure of segment profit or loss to be reported under certain circumstances.

This change is effective for

fiscal years beginning after December 15, 2023 and interim periods beginning after December 15, 2024.

This change will apply retrospectively

to all periods presented.

Management is currently assessing the impact of the adoption of this ASU on the financials statements of the

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