What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-03-31 compared with 2025-03-28 · 869 added, 3 removed, 2 unchanged (100% of the section changed)

Financial Statements and Supplementary Data

Our Financial Statements and Notes thereto and the reports of Salberg &

Company P.A for the year ended December 31, 2024 and Cherry Bekaert for the year ended December 31, 2023, our independent registered public

accounting firms, for the respective years ended listed above, are set forth on pages F-1 through F-22 of this Report.

PHARMACEUTICALS, INC.

TO FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm (PCAOB Firm ID 106 )

Consolidated Balance Sheets as of December 31, 2025 and 2024

Consolidated Statements of Operations for the years ended December 31, 2025 and 2024

Statements of Changes in Stockholders’ Equity for the years ended December 31, 2025 and 2024

Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024

Notes to Consolidated Financial Statements

of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of:

MIRA Pharmaceuticals, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance

sheets of MIRA Pharmaceuticals, Inc.

(the “Company”) as of December 31, 2025 and 2024, the related consolidated statements

of operations, changes in stockholders’ equity and cash flows for each of the two years in the period ended December 31, 2025, and

the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated

financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2025

and 2024, and the consolidated results of its operations and its cash flows for each of the two years in the period ended December 31,

2025, in conformity with accounting principles generally accepted in the United States of America.

Going Concern

The accompanying consolidated financial statements

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

As discussed in Note 2 to the consolidated financial statements,

the Company used approximately $4.6 million of cash in operations and had a net loss of $10.4 million during the year ended December 31,

These matters raise substantial doubt about the Company’s ability to continue as a going concern.

Management’s Plans

in regard to these matters are also described in Note 2.

The consolidated financial statements do not include any adjustments that might

result from the outcome of this uncertainty.

Basis for Opinion

These consolidated financial statements are the responsibility

of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements

based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”)

and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable

rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards

of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated

financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we

engaged to perform, an audit of internal control over financial reporting.

As part of our audits, we are required to obtain an understanding

of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s

internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess

the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures

that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the

consolidated financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by

management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audits provide

a reasonable basis for our opinion.

/s/ Salberg & Company, P.A.

SALBERG & COMPANY, P.A.

We have served as the Company’s auditor since 2024 .

Boca Raton, Florida

NW Corporate Blvd., Suite 240 ● Boca Raton, FL 33431-7326

(561) 995-8270 ● Toll Free:

(866) CPA-8500 ● Fax:

(561) 995-1920

www.salbergco.com

● info@salbergco.com

National Association of Certified Valuation Analysts ● Registered with the PCAOB

CPAConnect with Affiliated Offices Worldwide ● Member AICPA Center for Audit Quality

PHARMACEUTICALS, INC.

BALANCE SHEETS

Current assets:

Prepaid expenses

Short-term investment, at fair value – related party

Total current assets

Related party receivable

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Trade accounts payable and accrued liabilities

Due to related party

Total current liabilities

Total liabilities

Commitments and contingencies (Note 7)

Stockholders’ Equity

Preferred Stock, $ 0.0001 par value, 10,000,000 shares authorized and none issued or outstanding.

Common Stock, $ 0.0001 par value;

100,000,000 shares authorized, 41,938,587 and 16,560,852 shares issued and outstanding at December 31, 2025 and December 31, 2024, respectively.

Additional paid-in capital

Accumulated deficit

( 39,580,206 )

( 29,137,721 )

Total stockholders’ equity

Total liabilities and stockholders’ equity

accompanying notes are an integral part of these consolidated financial statements.

PHARMACEUTICALS, INC.

STATEMENTS OF OPERATIONS

Year Ended December 31,

Operating costs:

General and administrative expenses

Research and development expenses

Total operating costs

Other income (expense):

Interest income

Other expense

Unrealized loss on short-term investment

Total other income, net

( 10,442,485 )

( 7,852,659 )

Deemed dividend

( 21,556,821 )

Net loss attributable to common stockholders

$ ( 31,999,306 )

$ ( 7,852,659 )

Basic and diluted loss per share

Basic weighted average common stock shares outstanding

accompanying notes are an integral part of these consolidated financial statements.

PHARMACEUTICALS, INC.

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

Stockholders’

Balances, December 31, 2023

$ ( 21,285,062 )

Issuance of common stock-ATM, net of $ 32,500 in offering costs

Payment of short swing disgorgement by Bay Shore Trust

Stock-based compensation

( 7,852,659 )

Balances, December 31, 2024

$ ( 29,137,721 )

Issuance of common stock-ATM, net of $ 292,470 in offering costs

Issuance of common stock-ATM, net in offering costs

Issuance of common stock, SKNY acquisition

Common stock issued for option exercises

Common stock issued for vested RSU

Common stock granted to officer

Stock -based compensation

Stock -based compensation – stock option modification

( 10,442,485 )

Balances, December 31, 2025

$ ( 39,580,206 )

accompanying notes are an integral part of these consolidated financial statements.

PHARMACEUTICALS, INC.

STATEMENTS OF CASH FLOWS

Year Ended December 31,

Cash flows from operating activities

$ ( 10,442,485 )

$ ( 7,852,659 )

Adjustments to reconcile net loss to net cash used in operations

Stock-based compensation expense

Unrealized loss on short-term investments

Change in operating assets and liabilities:

Prepaid expenses

Other receivables

Trade accounts payable and accrued expenses

Related party accrued interest

Net cash used in operating activities

( 4,661,669 )

( 5,560,606 )

Financing activities:

Offering costs

Proceeds from related party

Proceeds from Common stock option exercises

Advances from (to) affiliates

Bayshore Trust short-swing disgorgement

Proceeds from sale of common stock

Net cash provided by financing activities

Net increase (decrease) in cash

( 1,769,635 )

Cash, beginning of year

Cash, end of year

Supplemental disclosure of cash flow information

Cash paid for interest

Cash paid for income taxes

Supplemental schedule of non-cash financing activities:

Deferred offering costs charged to additional paid-in capital

Issuance of common stock for the short-term investments, SKNY acquisition

accompanying notes are an integral part of these consolidated financial statements.

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

Description of business and summary of significant accounting policies :

Pharmaceuticals, Inc.

MIRA) is a clinical-stage pharmaceutical development company focused on developing novel oral small-molecule

therapeutics for neurologic, neuropsychiatric, metabolic, and inflammatory disorders.

The Company’s pipeline includes three product

Ketamir-2, MIRA-55, and SKNY-1.

is a next-generation oral NMDA receptor modulator that has completed Phase 1 clinical development and is being advanced toward Phase

2a clinical studies for neuropathic pain.

MIRA-55 is a novel oral cannabinoid analog in preclinical development for inflammatory pain

and related conditions.

SKNY-1 is a preclinical-stage oral therapeutic designed to modulate CB1, CB2, and monoamine oxidase B (MAO-B)

pathways and is being developed for obesity and nicotine dependence.

June 13, 2025, the Company formed MIRAPHARM Acquisition, Inc., a wholly owned Delaware subsidiary, to support the acquisition of SKNY

Pharmaceuticals, Inc., a private company developing SKNY-1 (See Note 5, Asset Acquisition) and related party due to common shareholders

and a shared licensor.

On September 29, 2025, the Company completed a stock-for-stock merger, with SKNY surviving as the Company’s

wholly owned subsidiary.

used herein, the Company’s Common Stock, par value $ 0.0001 per share, is referred to as the “Common Stock” and the

Company’s preferred stock, par value $ 0.0001 per share, is referred to as the “Preferred Stock”.

of Presentation and Principles of Consolidation

Company’s financial statements have been prepared in accordance with generally accepted accounting principles in the United States

of American (GAAP) as determined by the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC).

The consolidated

financial statements include the accounts of MIRA Pharmaceuticals, Inc.

and its wholly owned subsidiary.

All intercompany transactions

and balances have been eliminated in consolidation.

preparation of these consolidated financial statements in accordance with GAAP requires the Company’s management to make estimates

and assumptions that affect the reported amounts of assets, liabilities and expenses, and the disclosure of contingent assets and liabilities

at the date of the consolidated financial statements.

Actual results may differ from such estimates and such differences could be material.

Significant estimates during the reporting periods include the value of equity investments held, value of common shares issued

in an acquisition, stock-based compensation and the deferred tax asset valuation allowance.

Risks and Uncertainties

Company’s activities are subject to significant risks and uncertainties, including the risk of failure to secure additional funding

to properly execute the Company’s business plan.

The Company is subject to risks that are common to companies in the pharmaceutical

industry, including, but not limited to, development by the Company or its competitors of new technological innovations, dependence on

key personnel, reliance on third party manufacturers, protection of proprietary technology, and compliance with regulatory requirements.

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

Company considers all highly liquid debt instruments and other short-term investments with maturities of three months or less, when purchased,

to be cash equivalents.

The Company maintains cash and cash equivalent balances at two financial institutions that are insured by the

Federal Deposit Insurance Corporation (“FDIC”).

The Company’s account at these institutions are insured by the FDIC

up to $ 250,000 .

On December 31, 2025, the Company had cash in excess of FDIC limits of approximately $ 6.1 million.

To reduce its risk

associated with the failure of such financial institution, the Company evaluates at least annually the rating of the financial institution

in which it holds deposits.

Investments in Equity Securities, at Fair Value

Equity investments are carried at fair value with unrealized gains or losses recorded as

net unrealized gain (loss) on equity investments, a component of other income, in the accompanying consolidated statements of operations.

Realized gains and losses are determined on a specific identification basis which is recorded in earnings or loss as a net realized gain

(loss) on equity investments in the consolidated statement of operations.

The Company reviews investments in equity

securities, at fair value, for impairment whenever circumstances and situations change such that there is an indication that the carrying

amounts may not be recovered.

Value of Financial Instruments

Company measures the fair value of financial instruments in accordance with GAAP, which defines fair value, establishes a framework for

measuring fair value, and expands disclosures about fair value measurements.

defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal

or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

GAAP also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use

of unobservable inputs when measuring fair value.

The Company considers the carrying amount of deferred offering costs to approximate

fair value due to short-term nature of this instrument.

GAAP describes three levels of inputs that may be used to measure fair value:

1 - quoted prices in active markets for identical assets or liabilities.

2 - quoted prices for similar assets and liabilities in active markets or inputs that are observable.

3 - inputs that are unobservable (for example cash flow modeling inputs based on assumptions).

of fair value of financial instruments

December 31, 2025

Short-term investments

December 31, 2024

Short-term investments

Company has not generated revenue from contracts with customers as of December 31, 2025.

The Company will recognize revenue in accordance

with ASC 606, Revenue from Contracts with Customers , when it satisfies its performance obligations by transferring control of

promised goods or services to customers, in an amount that reflects the consideration to which the Company expects to be entitled.

and Development Expenses

and development costs are expensed in the period in which they are incurred and include the expenses paid to third parties, such as contract

research organizations and consultants, who conduct research and development activities on behalf of the Company.

Patent-related costs,

including registration costs, documentation costs and other legal fees associated with the application, are expensed in the period in

which they are incurred.

and Administrative Expenses

and administrative expenses are primarily comprised of personnel costs, insurance expenses, professional services fees, travel and office

expenses, and stock-based compensation.

General and administrative expenses are expensed as incurred.

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

Company accounts for stock-based compensation under the provisions of FASB ASC 718, “ Compensation - Stock Compensation .

Stock-based compensation cost for equity-classified awards is measured at the grant-date fair value of the award and is recognized as

expense over the requisite service period, generally on a straight-line basis.

The Company estimates the fair value of stock-based awards

on the date of grant using the Black-Scholes option pricing model, which requires the use of subjective assumptions including expected

volatility, expected term, risk-free interest rate, and expected dividends.

The Company has elected to account for forfeiture of stock-based

awards as they occur.

Company accounts for income taxes pursuant to the provision of Accounting Standards Codification (“ASC”) 740-10, “ Accounting

for Income Taxes ” (“ASC 740-10”), which requires, among other things, an asset and liability approach to calculating

deferred income taxes.

The asset and liability approach requires the recognition of deferred tax assets and liabilities for the expected

future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

allowance is provided to offset any net deferred tax assets for which management believes it is more likely than not that the net deferred

asset will not be realized.

Company follows the provision of ASC 740-10 related to Accounting for Uncertain Income Tax Positions.

When tax returns are filed, there

may be uncertainty about the merits of positions taken or the amount of the position that would be ultimately sustained.

In accordance

with the guidance of ASC 740-10, the benefit of a tax position is recognized in the consolidated financial statements in the period during

which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination,

including the resolution of appeals or litigation processes, if any.

Tax positions taken are not offset or aggregated with other positions.

Tax positions that meet the more likely than not recognition threshold are measured at the largest amount of tax benefit that is more

than 50 percent likely of being realized upon settlement with the applicable taxing authority.

The portion of the benefit associated

with tax positions taken that exceed the amount measured as described above should be reflected as a liability for uncertain tax benefits

in the accompanying balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon

The Company believes its tax positions are all more likely than not to be upheld upon examination.

As such, the Company

has not recorded a liability for uncertain tax benefits.

Company’s Chief Operating Decision Maker (CODM) is its Chief Executive Officer, who reviews financial information presented for

purposes of making operating decisions, assessing financial performance, and allocating resources.

The Company operates as a single operating

and reportable segment, consistent with the manner in which the CODM evaluates performance and allocates resources, see Note 10 for further

The Company has accounted

for leases under the provisions of FASB ASC Topic 842, “ Leases ”, which requires the Company to recognize right-to-use

(ROU) assets and lease liabilities for operating leases on the balance sheet.

Contingencies

the normal course of business, the Company may be subject to loss contingencies, such as legal proceedings, amounts arising from contractual

arrangements and claims arising out of the Company’s business that cover a wide range of matters, including, among others, government

investigations, shareholder lawsuits, and tax matters.

In accordance with ASC Topic 450, Accounting for Contingencies, (ASC 450),

the Company records accruals for such loss contingencies when it is probable that a liability will be incurred, and the amount of loss

can be reasonably estimated.

The Company, in accordance with this guidance, does not recognize gain contingencies until realized or realizable.

Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s

specific terms and applicable authoritative guidance in FASB ASC Topic 480, Distinguishing Liabilities from Equity (ASC 480) and

FASB ASC Topic 815, Derivatives and Hedging (ASC 815).

The assessment considers whether the warrants are freestanding financial

instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements

for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own Common Stock and whether

the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control,

among other conditions for equity classification.

This assessment, which requires the use of professional judgment, is conducted at the

time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component

of additional paid-in capital at the time of issuance.

For issued or modified warrants that do not meet all the criteria for equity classification,

the warrants are required to be liability classified and recorded at their initial fair value on the date of issuance and remeasured

at fair value and each balance sheet date thereafter.

Changes in the estimated fair value of the warrants are recognized as a non-cash

gain or loss on the statements of operations.

The Company generally determines fair value of the Common Stock Warrants using a Black-Scholes

valuation methodology.

change in any of the terms or conditions of warrants is accounted for as a modification.

The accounting for incremental fair value of

warrants is based on the specific facts and circumstances related to the modification which may result in a reduction of additional paid-in

capital, recognition of costs for services rendered, or recognized as a deemed dividend.

loss per share of common stock is computed by dividing net loss attributable to Common Stockholders by the weighted average number of

shares of common stock outstanding for the period.

Diluted loss per share reflects the potential dilution that could occur if stock options,

restricted stock awards and warrants were to vest and be exercised.

Diluted earnings per share excludes, when applicable, the potential

impact of stock options, common stock warrant shares, convertible notes, and other dilutive instruments because their effect would be

anti-dilutive in the periods in which the Company incurs a net loss.

following outstanding shares of common stock equivalents were excluded from the computation of the diluted net loss per share attributable

to common stock for the periods in which a net loss is presented because their effect would have been anti-dilutive.

of diluted net loss per share attributable to common stock

Stock options

Common stock warrants

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

Accounting Pronouncements

time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and are adopted by the Company as

of the specified effective date.

December 2023, the FASB issued Accounting Standards Update (ASU) No.

2023-09 Income Taxes (Topic 740):

Improvements to Income

Tax Disclosures (ASU 2023-09), which is intended to enhance the transparency and decision usefulness of income tax disclosures, primarily

by amending disclosure requirements for the effective tax rate reconciliation and income taxes paid.

ASU 2023-09 should be applied on

a prospective basis, and retrospective application is permitted.

ASU 2023-09 is effective for annual periods beginning after December

Early adoption is permitted.

The Company adopted this ASU or the year ended December 31, 2025 (see Note 15 “Income Taxes”

for more information).

Accounting Pronouncements Not Yet Adopted

November 2024, the FASB issued ASU No.

2024-03, Income Statement — Reporting Comprehensive Income — Expense

Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses (“ASU 2024-03”) and in January

2025, the FASB issued ASU No.

2025-01, Income Statement — Reporting Comprehensive Income — Expense Disaggregation

Disclosures (Subtopic 220-40):

Clarifying the Effective Date , which clarified the effective date of ASU 2024-03.

ASU 2024-03 will

require the Company to disclose the amounts of purchases of inventory, employee compensation, depreciation, and intangible asset amortization,

as applicable, included in certain expense captions in the Consolidated Statements of Operations, as well as qualitatively describe remaining

amounts included in those captions.

ASU 2024-03 will also require the Company to disclose both the amount and the Company’s definition

of selling expenses.

The Company is currently evaluating the impact of adopting of ASU 2024-03.

has considered all other recent accounting pronouncements that are issued, but not effective, and it does not believe that they will

have a significant impact on the Company’s results of operations or financial position.

Going Concern

accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern which

contemplates the realization of assets and settlement of liabilities and commitments in the normal course of business.

inception, the Company has incurred recurring operating losses and negative cash flows from operations and has no revenues.

As of December 31, 2025,

the Company had cash of approximately $ 6.3 million and

reported a net loss of $ 10.4

million for the year ended December 31, 2025.

The Company raised net capital of approximately $ 6.7

million in 2025 and used approximately $ 4.7

million of cash in operations during the year ended December 31, 2025.

The Company had stockholders’ equity and working

capital of approximately $ 10.4

million and $ 10.4 million

at December 31, 2025, respectively, compared to stockholders’ equity of approximately $ 2.2

million and working capital of $ 2.2

million as of December 31, 2024.

Historically, the Company has been primarily engaged in developing

Ketamir-2 and MIRA-55.

During these activities, the Company sustained substantial losses.

The Company’s ability to fund ongoing

operations and future clinical trials required for FDA approval is dependent on the Company’s ability to obtain significant additional

external funding in the near term.

Since inception, the Company has financed its operations through related party financings — see

Note 6, and initial public offering in 2023.

The Company maintains an effective shelf registration statement with the SEC for the issuance

of shares of common stock under various types of equity offerings, including the shares of common stock under our ATM equity program (See

The Company expects to be able to fund operations into the first quarter of 2027, with the cash on hand.

However, the Company

has the ability to issue common stock under its shelf registration statement to assist in liquidity needs.

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

of the date of filing this Report, the Company will continue to generate losses and have insufficient cash and cash equivalents on hand

to support its operations for at least the 12 months following the date the consolidated financial statements are issued.

These factors

raise substantial doubt about the Company’s ability to continue as a going concern for a period of twelve months from the issuance

date of this report.

Management cannot provide assurance that the Company will ultimately achieve profitable operations or become cash

flow positive or raise additional debt and/or equity capital.

The Company is seeking to raise capital through additional debt and/or

equity financings to fund our operations in the future.

If the Company is unable to raise additional capital or secure additional lending

in the near future, management expects that the Company will need to curtail its operations.

These consolidated financial statements

do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities

that might be necessary should the Company be unable to continue as a going concern.

Prepaid expenses

expense and other current assets consisted of the following at the dates indicated:

of prepaid expenses

December 31, 2025

December 31, 2024

Prepaid expense:

Prepaid insurance

Other prepaid expense

Total prepaid expenses

License agreement, related party

November 15, 2023, the Company and MIRALOGX, LLC, a Florida limited liability company (“MIRALOGX”) entered into an exclusive

license agreement (the “License Agreement”) to develop and commercialize Ketamir-2, a drug product containing 2-(2- chlorophenyl)-2-(methylamino)

cyclopentan-1-one as an active agent in the United States, Canada and Mexico (the “Territory”).

The exclusive license in

the License Agreement includes the right of the Company to sublicense the licensed intellectual property.

The Company and MIRALOGX have

the same founder, who is also related to Company’s largest shareholder and thus MIRALOGX is considered a related party.

to the terms of the License Agreement, and subject to the conditions set forth therein, the Company paid MIRALOGX a one-time, nonrefundable

payment of $ 0.1 million upon the signing of the Agreement and will be obligated to pay quarterly royalty payments on sales of the Ketamir-2

in the Territory of 8% of net sales and 8% of other revenue (such as milestone or sublicense payments) from licensed products.

in consideration of the License Agreement, the Company issued to MIRALOGX a Common Stock Purchase Warrant to purchase up to 700,000 shares

of the Company’s common stock (the “MIRALOGX Warrant”).

The MIRALOGX Warrant is exercisable, in whole or in part, any

time prior to November 15, 2028 at a cash exercise price of $ 2.00 per share.

Company and MIRALOGX have made customary representations and warranties in the License Agreement and have agreed to certain other customary

covenants, including confidentiality, cooperation, and indemnity provisions.

Either party may terminate the License Agreement for cause

if the other party materially breaches or defaults in the performance of its obligations, and, if curable, such material breach remains

uncured for 120 days.

Unless earlier terminated, the License Agreement will continue in effect until the last to expire of the patent

rights licensed pursuant to the License Agreement.

the SKNY asset acquisition (See Note 5), the Company acquired the license to SKNY-1, a preclinical drug candidate (the “SKNY License”)

originally licensed from MIRALOGX by SKNY.

In acquiring the rights to the SKNY License, the Company gained the rights to commercialize

SKNY-1 in the United States, Canada, and Mexico.

Pursuant to the terms of the SKNY License, and subject to the conditions set forth therein,

the Company will be obligated to pay a royalty payment of 8 % of net sales, with a minimum annual royalty of $ 250,000 .

Unless earlier

terminated, the SKNY License Agreement will continue in effect until the last to expire of the patent rights licensed pursuant to the

SKNY License (see Note 5, Asset Acquisition).

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

Asset Acquisition

of SKNY Pharmaceuticals, Inc.

On March 19, 2025, we entered

into a binding letter of intent (the “LOI”) with SKNY Pharmaceuticals, Inc.

(“SKNY”), a privately held Delaware

corporation, which is a related party due to certain common shareholders and licensor, to acquire SKNY through a stock-for-stock merger

with our merger subsidiary, which we formed on June 13, 2025 (the “Merger”).

On September 29, 2025 (the “Closing

Date”), we closed this merger.

SKNY was the survivor of this merger and became our wholly owned subsidiary.

SKNY’s preclinical

drug candidate, SKNY-1, is designed to modulate CB1, CB2, and MAO-B pathways to address energy storage, lipid metabolism, appetite, cravings,

and reward - without the psychiatric side effects that limited earlier CB1-targeting drugs.

SKNY holds exclusive rights in the United

States to its drug candidate under license from Miralogx, a related party of the Company, see Note 3, License Agreement, Related Party.

The transaction was recorded as an asset acquisition from a related party at acquired cost basis with two assets acquired, a license agreement

and 3,521,127 shares in common stock of Telomir Pharmaceuticals, Inc.

TELO), a publicly traded preclinical stage biotechnology

company, which is a related party to MIRA due to certain common ownership, officers and directors.

The 3,521,127 shares of TELO

common stock were contributed to the Company on behalf of SKNY by SKNY’s largest shareholder.

The 3,521,127 shares in

TELO represented $ 5,000,000 based on the 10-day average of the closing share price of TELO stock, $ 1.42 , for the ten trading days

prior to September 25, 2025, (the “Measurement Date”).

On September 29, 2025 (the “Closing Date”), MIRA Pharmaceuticals,

received the SKNY License with Miralogx which was recorded at its carryover basis of zero and received the TELO shares and recorded

their value as of the Closing Date as $ 4,718,310 based on the TELO closing price on September 29, 2025 of $ 1.34 per share.

The 3,521,127 shares

in TELO were recorded on the MIRA balance sheet as a Short-term equity investment.

On December 31, 2025, the value of these shares was

adjusted to $ 4,683,099 based on the TELO closing price on December 31, 2025, with a corresponding $ 35,212 in unrealized loss

recognized in other income.

Also on the Closing

date, MIRA issued 19,755,738 new

shares in MIRA common stock to the SKNY shareholders (See Notes 6 and 9).

The common shares were valued at $ 26,275,132 based

on the quoted trading price of the Company’s stock on September 29, 2025 of $ 1.33 per

The excess fair value of the MIRA common shares issued over the $ 4,718,310 net

assets received in SKNY of $ 21,556,821 has

been reflected as a deemed dividend with a charge to additional paid-in capital of $ 21,556,821 .

The net increase to equity of the common shares was $ 4,718,311 .

Related party transactions

from Related Party

due from MIRALOGX as of December 31, 2025 and 2024, which are presented as a related party receivable, in the accompanying

consolidated balance sheets, totaled $ 35,439 .

These aforementioned amounts are composed of accounts payable paid on behalf of a related

party, specifically, research and development payables.

There has been no related party activity since December 31, 2024.

to Related Party

of December 31, 2025, the Company owed an aggregate of $ 572,865 to its Chairman and Chief Executive Officer, Erez Aminov, primarily related

to accrued compensation and advances made to the Company to cover certain Company-related payables.

There were no amounts due to related

parties as of December 31, 2024.

Note 5 for asset acquisition from a related party.

Settled Agreement

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

Commitments and contingencies

the ordinary course of business, the Company enters into various agreements containing standard indemnification provisions.

The Company’s

indemnification obligations under such provisions are typically in effect from the date of execution of the applicable agreement through

the end of the applicable statute of limitations.

The aggregate maximum potential future liability of the Company under such indemnification

provisions is uncertain.

As of December 31, 2025 and 2024, no amounts have been accrued related to such indemnification provisions.

time to time, the Company may be exposed to litigation in connection with its operations.

The Company’s policy is to assess the

likelihood of any adverse judgments or outcomes related to legal matters, as well as ranges of probable losses.

The Company’s former

corporate headquarters were located in Baltimore, Maryland, which included a lease for office space.

This lease began in November 2021

and ended April 2024.

The lease was not renewed after April 2024.

In April 2024, the Company moved to a virtual office model and does

not have a physical office space as of December 31, 2025 nor 2024.

The Company had leased an

office in Tampa, Florida, for its finance and general operations, which began in March 2022 for 37 months.

On December 1, 2023, the Company

formally terminated the lease with the landlord.

There was a remaining deposit due from the landlord to the Company of $ 0.005 million,

which was collected as of December 31, 2024.

Variable lease costs

Variable lease costs primarily include utilities,

property taxes, and other operating costs that are passed on from the lessor.

Schedule of Lease Expense

For the year ended December 31,

Operating lease costs

Variable lease costs

Total lease cost

Supplemental cash flow information related to

leases was as follows:

Schedule of Cash Flow Information Related to Leases

For the year ended December 31,

Other lease information

Cash paid for amounts included in the measurement of lease liabilities

Operating cash flows from operating leases

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

The Company elected to prospectively

adopt the guidance in ASU No.

2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.” The following table

reconciles the U.S.

federal statutory income tax rate of 21 % to the Company’s effective income tax rate for the years ended December

31, 2025 and 2024 in accordance with the guidance in ASU No.

The following table reconcile the U.S.

Federal statutory income tax rate

to the Company’s effective income tax rate for years ended December 31, 2025 and 2024:

Schedule of Reconciliation of Effective Income Tax Rate

Year ended December 31,

Components of loss before provision for income taxes

Provision for income taxes at U.S.

federal statutory rate

$ ( 2,192,922 )

$ ( 1,649,058 )

State and local income taxes, net of federal benefit

Change in Valuation Allowance

Other permanent items

( 1,320,613 )

Other adjustments

Total tax provision and effective tax rate

significant components of the Company’s net deferred tax assets are as follows:

of Deferred Tax Assets and Liabilities

of December 31,

Net operating loss carry-forward

Section 174 Qualified Research Expenditures

Stock compensation

Deferred tax assets, Gross

valuation allowance

( 9,589,307 )

( 6,925,163 )

net deferred tax asset

in 2022, in accordance with Internal Revenue Code Section 174, Qualified Research Expenditures are capitalized for tax purposes and amortized

over a period of five years.

Accordingly, for income tax purposes, and as of December 31, 2025 and December 31, 2024, the Company has

recorded a deferred tax asset totaling approximately $ 9.6 million and $ 6.9 million, respectively, related to the timing difference between

GAAP and Tax recognition of these expenditures.

components of the provision for income taxes consist of the following:

Schedule of Components of Income Tax Provision

Deferred tax:

( 9,589,307 )

( 3,311,252 )

Change in valuation allowance

Total deferred

Total provision for income taxes

Topic 740 requires that a deferred tax amount be reduced by a valuation allowance if, based on the weight of available evidence it is

more likely than not (a likelihood of more than 50%) that some portion or all of the deferred tax assets will not be realized.

The valuation

allowance should be sufficient to reduce the deferred tax asset to the amount that is more likely than not to be realized.

has recorded a full valuation allowance against its deferred tax assets generated by net operating loss carryforwards as it has determined

that such amounts may not be recognizable, given the historical losses of the Company to date.

As of December 31, 2025, the Company has

a cumulative federal net operating loss carryforward of approximately $ 20.1 million.

The net operating loss carryforwards have no expiration

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

Stockholders’ equity

Capital stock

The Company has the authority

to issue 110,000,000 shares of capital stock, consisting of 100,000,000 shares of Common Stock and 10,000,000 shares of undesignated preferred

stock, whose rights and privileges will be defined by the Board of Directors when a series of preferred stock is designated.

Common Stock sold under ATM

August 12, 2024, the Company filed a shelf registration statement with the SEC to facilitate the issuance of our common stock and entered

into an At-the-Market Offering Agreement (the “ATM Agreement”) with Rodman & Renshaw LLC, under which the Company may

offer and sell shares of its Common Stock, with an aggregate offering amount sold of up to $ 19,268,571 .

On September 24, 2024, the Company

filed a prospectus supplement to amend the shelf registration statement to update the maximum amount eligible to be sold under the ATM

Agreement to $ 75 million.

the year ended December 31, 2025, under the ATM Agreement, the Company sold and issued 4,133,402 shares of Common Stock at an

average price per share of $ 1.62 and received net proceeds of $ 6,714,512 after deducting commissions and other fees of

During the year ended December 31, 2024, under the ATM Agreement, the Company has sold 1,779,967 shares of Common Stock

in 2024 at an average price per share of $ 1.65 and received net proceeds of approximately $ 3.6 million, after deducting commissions

and other fees of $ 0.13 million.

Common Stock issued for Acquisition

September 29, 2025, in connection with acquisition of SKNY Pharmaceuticals, Inc.

(See Note 5), the Company issued 19,755,738 new shares

in Company Common Stock to the SKNY shareholders.

The common shares were valued at $ 26,275,132 based on the quoted trading price of the

Company’s stock on September 29, 2025 of $ 1.33 per share.

The excess fair value of the Company common shares issued over the $ 4,718,311

net assets received in SKNY of $ 21,556,821 has been reflected as a deemed dividend with a charge to additional paid-in capital of $ 21,556,821 .

The net increase to equity of the common shares was $ 4,718,311 .

settlement agreement

April 24, 2024 the Company settled a claim submitted by certain shareholders under Section 16 of the Securities Exchange Act involving

the Company that claimed illegal profits were earned on stock transactions involving insiders of the Company.

After investigation, the

Company informed the insider, Bay Shore Trust, of the claim and came to agreement with the shareholders, requiring the disgorgement

of profits by the insider back to the Company in the amount of $ 148,703 , which was recorded in additional paid in capital in the accompanying

consolidated financial statements as of December 31, 2024.

Common Stock issued upon stock option exercise

During the year ended December 31, 2025,

former and current executives of the Company exercised outstanding stock options to acquire an aggregate of 863,595 shares of the Company’s

common stock.

The Company received net cash proceeds of $ 888,282 in connection with these option exercises.

There were no stock options

exercised during the year ended December 31, 2024.

Stock issued for vested RSUs

the year ended December 31, 2025, a total of 625,000 restricted stock units were vested, resulting in the issuance of 625,000 shares

of common stock.

During the year ended December 31, 2024, no common stock was issued in as a result of vesting of restricted stock units.

Omnibus Incentive Plan

June 2022, the Company’s Board of Directors adopted, and its stockholders approved, the Company’s 2022 Omnibus Incentive

Plan, as amended and restated in August 2023, (“2022 Omnibus Plan”).

The 2022 Omnibus Plan authorizes the grant of incentive

stock options, within the meaning of Section 422 of the Internal Revenue Code, to the Company’s employees and any of its parent

and subsidiary corporations’ employees, and for the grant of non-statutory stock options, restricted stock, restricted stock units,

stock appreciation rights, performance units and performance shares to the Company’s employees, directors, and consultants and

any of its future subsidiary corporations’ employees and consultants.

On September 11, 2025, the Company held its 2025 Annual Meeting

of Stockholders (the “Annual Meeting”) in which it was voted upon to increase the shares provided under the plan from 5,000,000

shares to 8,000,000

In addition, the number of shares available

for issuance under the Plan includes an annual increase on the first day of each fiscal year equal to the lesser of (a) 500,000 shares,

(b) 5.0 % of the outstanding shares of all classes of our common stock as of the last day of the immediately preceding fiscal year, or

As of December 31,

2025, the 2022 Omnibus Plan provides that 8,780,939

shares of the Company’s Common Stock are reserved for issuance under the 2022 Omnibus Plan, all of which may be issued pursuant

to the exercise of incentive stock options.

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

fair value of each option award is estimated on the grant date using the Black-Scholes valuation model that uses assumptions for expected

volatility, expected dividends, expected term, and the risk-free interest rate.

Historically, the Company estimated expected price volatility based on the historical volatilities of a peer group

as the Company did not have a multi-year trading history for its shares.

Industry peers consist of several public companies in the biotech

industry similar to the Company in size, stage of life cycle, and product indications.

In September 2025, the Company commenced using

the historical volatility of its shares as an estimate of expected share price volatility.

term of options granted is derived using the “simplified method” which computes expected term as the average of the sum of

the vesting term plus contract term.

The risk-free rate is based on the 5-year U.S.

Treasury yield curve in effect at the time of grant.

The Company recognizes forfeitures as they occur.

the year ended December 31, 2025, a total of 3,230,170 options to purchase Common Stock, with an aggregate fair market value of approximately

$ 4.5 million were granted to the Company’s executive officers, management, and consultants of the Company.

Options have a term

of 10 years from the grant date.

These options vest in various terms ranging from immediate vesting upon grant to the second anniversary

of the grant date.

the year ended December 31, 2024, a total of 3,599,000 options to purchase Common Stock, with an aggregate fair market value of approximately

$ 2.79 million were granted to the Company’s executive officers, management, and consultants of the Company.

Options have a term

of 10 years from the grant date.

These options vest in various terms ranging from immediate vesting upon grant to the second anniversary

of the grant date.

following table summarizes the Company’s employee and non-employee stock option activity under the 2022 Omnibus Plan for the following

Schedule of option activity

Number of Shares

Weighted Average Exercise Price Per Share

Weighted Average Remaining Contractual Life (Years)

Aggregate Intrinsic Value

Outstanding as of December 31, 2023

Outstanding as of December 31, 2024

Outstanding as of December 31, 2025

Exercisable as of December 31, 2025

Company recognized approximately $ 6.1

million and $ 1.9

million in stock-based compensation when includes compensation for stock options and vested RSUs in 2025 and 2024, respectively.

weighted average grant-date fair values of options granted during the years ended December 31, 2025 and 2024 were $ 1.40

per share, respectively.

As of December 31, 2025, there is approximately $ 54,000

of unrecognized compensation cost related to unvested stock options granted under the Company’s 2022 Plan that is expected to

be recognized over the next year.

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

assumptions used to value stock options during the years ended December 31, 2025 and 2024 are as follows:

Schedule of fair value options issued

Years Ended December 31,

Risk-free interest rate

3.70 - 4.20 %

3.49 - 4.56 %

Expected volatility

186.0 - 210.0 %

58.46 - 152.45 %

Exercise Price

$ 1.18 - $ 1.45

Expected term (years)

5.0 - 5.4 years

5.0 - 5.5 years

Dividend yield

September 15, 2025, the compensation committee of the Company voted to reprice the exercise price of certain stock options

previously granted to the Chief Executive Officer, Erez Aminov.

In total, 300,000

stock options were repriced from $ 5.00 and $ 6.50 per share, to use the closing price of $ 1.38 ,

MIRA’s common stock on September 15, 2025, as the exercise price.

As a result of this stock option repricing, an additional

expense of $ 124,972

was included in stock-based compensation for the year ended December 31, 2025.

July 15, 2025, Michelle Yanez, the Company’s former Chief Financial Officer, exercised options to purchase 126,061 shares of the

Company’s common stock.

The Company received $ 151,023 in net proceeds from this transaction.

September 12, 2025, Michelle Yanez exercised options to purchase 98,939 shares of the Company’s common stock.

The Company received

$ 117,019 in net proceeds from this transaction.

September 22, 2025, a former company employee exercised options to purchase 25,000 shares of the Company’s common stock.

received $ 29,750 in net proceeds from this transaction.

October 16, 2025, Erez Aminov, the Company’s Chairman and Chief Executive Officer, exercised options to purchase 613,595 shares

of the Company’s common stock.

The Company received $ 590,490 in net proceeds from this transaction.

the year ended December 31, 2024, a total of 500,000 restricted stock units (“RSU”), with an aggregate fair market value

of approximately $ 0.6 million were granted to the Company’s Chief Executive Officer under the 2022 Omnibus Incentive Plan.

RSU’s vest as follows:

(i) 50 % on February 12, 2025 (ii) 50 % at 6-month anniversary of date of grant.

The awards were fair valued

using the closing price of the stock of $ 1.19 on December 6 th , 2024.

All these RSU’s were vested during the year ended

December 31, 2025.

March 26, 2025, the compensation committee of the Company adopted the Company’s Executive Incentive Compensation Plan (the

“EICP”) for Erez Aminov, its Chairman and Chief Executive Officer.

Under the EICP, Mr.

Aminov will be eligible for

certain long-term awards of up to 500,000

performance-based and market condition-based restricted stock units of the Company’s common stock, par value $ 0.001

upon the Company achieving specified milestones based upon the Company reaching certain market capitalization values and the

progress of the Company’s drug candidates.

All awards under the EICP are subject to the approval of the Board and the

Furthermore, the Board and the Committee, each in its sole discretion, generally retain the right to amend, supplement,

supersede or cancel any awards under the EICP for any reason, and reserve the right to determine whether and when to pay out any

bonus amounts pursuant to or outside of the EICP, regardless of the achievement of the performance targets.

On July 18, 2025, the Board and the Committee determined the Market

capitalization threshold of $ 25 million had been achieved.

As a result, on August 15, 2025, the grant date, the Company issued Erez Aminov

$ 50,000 in cash and 62,500 vested restricted stock units, with the restricted stock units having an aggregate fair market value of $ 93,750 .

On December 16, 2025, the Board and the Committee determined the Market capitalization threshold of $ 50 million had been achieved.

a result, on December 12, 2025, the grant date, the Company issued Erez Aminov $ 50,000 in cash and 62,500 vested restricted stock units,

with the restricted stock units having an aggregate fair market value of $ 90,625 .

PHARMACEUTICALS, INC.

TO THE CONSOLIDATED FINANCIAL STATEMENTS

31, 2025 AND 2024

following is RSU activity during the year ended December 31, 2025:

Schedule of restricted stock unit activity

Number of Restricted Shares

Unvested as December 31, 2024

Expired and forfeitures

Unvested as December 31, 2025

connection with various transactions and the IPO summarized below, the Company issue stock warrants.

Warrant activity for the year ended

December 31, 2025 is summarized below:

Schedule of warrant activity

Intrinsic Value

Balance Outstanding as December 31, 2024

Balance outstanding as December 31, 2025

Exercisable, December 31, 2025

Segment Information

Company operates in one reportable segment related to the development and commercialization of pharmaceuticals targeting neurologic and

neuropsychiatric disorders.

The CODM for the Company is the Chief Executive Officer (the “CEO”).

The Company’s CEO

reviews operating results on an aggregate basis and manages the Company’s operations as a whole for the purpose of evaluating financial

performance and allocating resources.

Accordingly, the Company has determined that it has a single reportable and operating segment structure.

The CEO uses aggregate net loss to allocate resources in the annual budgeting and forecasting process and also uses that measure as a

basis for evaluating financial performance regularly by comparing actual results with established budgets and forecasts.

accounting policies of the Company’s single segment are the same as those described in the summary of significant accounting policies

within Note 1.

The CEO assesses performance for the Company and decides how to allocate resources based on the aggregate net loss that

is also reported on the income statement as net loss.

The measure of segment assets is reported on the balance sheets as total assets.

table below provides information about the Company’s revenue, significant segment expenses and other segment expenses.

Schedule of segment expenses and other segment expenses

Year Ended December 31,

Operating costs:

General and administrative expenses

Research and development expenses

Total operating costs

Other income (expense):

Interest income

Other expense

Unrealized loss on short-term investment

Total other income, net

Segment net loss

( 10,442,485 )

( 7,852,659 )

Subsequent Events

March 29, 2026, the Board and the Committee determined the certain milestone in Company’s Phase I clinical trial had been achieved.

As a result, on March 29, 2026, the grant date, the Company issued Erez Aminov $ 80,753 in cash and 83,500 vested restricted stock units,

with the restricted stock units having an aggregate fair market value of approximately $ 86,000 .

Changes In and Disagreements with Accountants on Accounting and Financial Disclosure.

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data