Item 9A. Controls and Procedures
Item 9A. Controls and Procedures
Disclosure Controls and Procedures
We maintain disclosure controls and procedures, which are designed to provide reasonable assurance that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, conducted an evaluation, as of the end of the period covered by this report, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15e under the Exchange Act). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective at the reasonable assurance level.
Management’s Annual Report on Internal Control over Financial Reporting
Our management, including our Chief Executive Officer and Chief Financial Officer, are responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) under the Exchange Act). Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Internal control over financial reporting includes policies and procedures that:
● pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and asset dispositions;
● provide reasonable assurance that transactions are recorded as necessary to permit the preparation of our financial statements in accordance with generally accepted accounting principles;
● provide reasonable assurance that receipts and expenditures are made only in accordance with authorizations of our management and board of directors (as appropriate); and
● provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on our financial statements.
Due to its inherent limitations, any system of internal control over financial reporting, no matter how well defined, may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2025, based on the framework set forth in Internal Control — Integrated Framework by The Committee of Sponsoring Organizations of the Treadway Commission (COSO) (2013). Based on this assessment using this framework, our management concluded that our internal control over financial reporting was effective as of December 31, 2025.
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Attestation Report of the Registered Public Accounting Firm
This Annual Report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting because Quoin Pharmaceuticals Ltd. is not an accelerated filer or a large accelerated filer, and it is not subject to the attestation requirement.
Changes in Internal Control over Financial Reporting
There was no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act), that occurred during the quarter ended December 31, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Item 9B. Other Information
During the fourth quarter of 2025, none of our directors or executive officers adopted or terminated any “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement” (as each term is defined in Item 408(a) of Registration S-K).
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
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PART III
Item 10. Directors, Executive Officers and Corporate Governance.
Set forth below is certain information regarding the members of our board of directors (the “Board” or the “Board of Directors”) and our executive officers.
Name
Age
Position(s)
Dr. Michael Myers
64
Chairman of the Board and Chief Executive Officer
Denise Carter
57
Director and Chief Operating Officer
Joseph Cooper (1)(3)
68
Director
James Culverwell (2)4)
69
Director
Dr. Dennis H. Langer (5)
74
Director
Natalie Leong (1)(6)
41
Director
Michael Sember (2)
76
Director
Sally Lawlor
43
Chief Financial Officer
(1) Member of our Audit Committee.
(2) Member of our Compensation Committee.
(3) Member of our Nominating and Governance Committee.
(4) Chairperson of our Audit Committee
(5) Chairperson of our Compensation Committee
(6) Chairperson of our Nominating and Governance Committee
Set forth below is a summary of the business experience of each of our directors and executive officers.
Dr. Michael Myers , Chief Executive Officer and Director . Dr. Myers is the co-founder of Quoin Inc. and has served as Chairman and Chief Executive Officer of Quoin Inc. since its inception in 2018. Dr. Myers has served as Chairman and Chief Executive Officer of Quoin Ltd. since October 28, 2021. Dr. Myers has over 36 years of industry experience in the drug delivery and specialty pharmaceutical sectors. From 2003 to October 2015, he served as Chief Executive Officer of Innocoll AG (n/k/a Innocoll Biotherapeutics N.A. Inc.), a biotherapeutics pharmaceutical company, and was responsible for taking that company public in 2014. From 2001 to 2002, he served as President of the drug delivery division of West Pharmaceutical Services, Inc., a publicly traded company and a designer and manufacturer of injectable pharmaceutical packaging and delivery systems. From 1996 to 1999, Dr. Myers served as the President of Pharmaceutical Operations for Fuisz Technologies (Biovail), a developer of food and drug delivery systems and technologies. From 2000 to 2001, Dr. Myers served as Executive Vice President and Chief Commercial Officer of Flamel Technologies (n/k/a Avadel Pharmaceuticals PLC, a publicly traded company and a specialty pharmaceutical company. From 1987 to 1995, Dr. Myers served as the Head of Pharmaceutical Development for Elan Corporation, a biotechnology drug company. Since 2019, Dr. Myers has served as a director of Sonoran Bioscience and Wellesley Pharmaceuticals, each a specialty pharmaceutical company. Dr. Myers has served as a director of Cranial Devices, a clinical stage medical device company since 2023. Dr. Myers earned his Ph.D. in Chemistry from University College Cork, Ireland. We believe Dr. Myers is qualified to serve on our Board due to his extensive knowledge as one of Quoin Inc.’s co-founders and Chief Executive Officer, and his extensive clinical development, commercial and management experience with both public and private life sciences companies.
Denise Carter , Chief Operating Officer and Director . Ms. Carter is the co-founder of Quoin Inc. and has served as a director and Chief Operating Officer of Quoin Inc. since its inception in 2018. Ms. Carter has served as a director and Chief Operating Officer of Quoin Ltd. since October 28, 2021. Ms. Denise Carter has over 30 years of experience in the drug delivery and specialty pharmaceutical industries. From June 2003 to October 2015, Ms. Carter held various positions at Innocoll AG (n/k/ a
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Innocoll Biotherapeutics N.A. Inc.), including President of Innocoll Pharmaceuticals and Executive Vice President of Business Development and Corporate Affairs of Innocoll AG. From 2001 to 2003, Ms. Carter was the Vice President of Business Development of the drug delivery division of West Pharmaceuticals, Inc., a publicly traded company. From 2000 to 2001, she was the Senior Director of Business Development of Eurand, a specialty pharmaceutical company. From 1996 to 1999, Ms. Carter was the Director of Business Development and Alliance Management of Fuisz Technologies (Biovail). From 1999 to 2000, Ms. Carter was the Director of Business Development of Cardinal Health, Inc., a multi-national health care service company. Ms. Carter earned her MBA from Wharton School of Business, University of Pennsylvania and a B.S. in Chemistry from the College of William and Mary. We believe Ms. Carter is qualified to serve on our Board due to her extensive knowledge as one of Quoin Inc.’s co-founders and Chief Operating Officer, and her extensive business development, sales and marketing and fundraising experience in the life sciences industry.
Sally Lawlor, Chief Financial Officer. Ms. Lawlor has served as Chief Financial Officer of Quoin Ltd. since August 18, 2025 and has 20 years of experience in financial leadership roles in public and private companies as well as a “Big Four” accounting firm. Ms. Lawlor served as both Senior Director – Group Tax (from January 2023 through August 2025) and Director – Group Tax (December 2021 through January 2023) at Sebela Pharmaceuticals Inc., a pharmaceutical company delivering therapeutic options for gastrointestinal diseases and with a focus on innovation in women’s health. In her most recent role at Sebela Pharmaceuticals, Ms. Lawlor managed financial reporting under U.S. GAAP and IFRS, oversaw global tax planning and compliance, as well as budgeting, forecasting, and external audits. Prior to Sebela, from December 2017 through September 2021, Ms. Lawlor served in senior tax leadership positions at Aptiv Plc, a global technology company that designs, develops and manufactures software and hardware solutions to enable a safer, greener and more connected future of mobility. Prior thereto, Ms. Lawlor spent eleven years at KPMG advising multinational clients, primarily in the pharmaceutical and technology sectors. Ms. Lawlor is a Fellow of Chartered Accountants Ireland and a member of the Irish Taxation Institute. She earned her Bachelor of Common Law from University College Cork. Ms. Lawlor is the niece of Dr. Michael Myers, the Company’s Chairman and Chief Executive Officer.
Joseph Cooper , Director . Mr. Cooper has served as a director of Quoin Inc. since May 2021. Mr. Cooper has served as a director of Quoin Ltd. since October 28, 2021. Mr. Cooper has significant experience in finance, operation, corporate development and general management roles within the pharmaceutical and healthcare industry. Since July 2023, Mr. Cooper has served as Chief Financial Officer for Hydrinity Skin Sciences, a medical aesthetics company. From 2012 to 2023, Mr. Cooper served as the President of Boulder Cove LC, a pharmaceutical and healthcare consulting company. From September 2019 to December 2022, Mr. Cooper served as the Chief of Strategy and Corporate Development for Resonea, Inc., a digital health company. From August 2018 to December 2019, Mr. Cooper served as the Chief Business Officer of NuvOx Pharmaceuticals, a clinical stage pharmaceutical company. From January 2015 to August 2018, Mr. Cooper served as Chief Financial and Operating Officer for First Place, AZ, a non-profit healthcare services organization. From 1996 to 2010, Mr. Cooper served as the Executive Vice President of Corporate and Product Development of Medicis Pharmaceutical Corp., a publicly traded pharmaceutical and medical aesthetics company. Since January 2018, Mr. Cooper has served as a director of Sonoran Biosciences, a specialty pharmaceutical company. From 2006 to 2007, Mr. Cooper served as a director of Bioenvision, a publicly traded pharmaceutical company. Mr. Cooper holds an MBA from the WP Carey School of Business at Arizona State University and a BA from Northeastern Illinois University. We believe Mr. Cooper is qualified to serve on our Board due to his extensive executive and board experience with pharmaceutical and healthcare companies.
James Culverwell , Director . Mr. Culverwell has served as a director of Quoin Inc. since April 2021. Mr. Culverwell has served as a director of Quoin Ltd. since October 28, 2021. Since May 2013, Mr. Culverwell has served as the Chief Executive Officer and is currently Chairman of the Board of Directors of HOX Therapeutics, a prostate cancer research company. In 2005, Mr. Culverwell founded Sudbrook Associates, which provided strategic advice and fund raising services for life science companies. From 1992 to 2004, Mr. Culverwell was Senior Vice President and Global Coordinator Healthcare Research at Merrill Lynch. From 1982 to 1992, Mr. Culverwell was Director of Healthcare Equity Research at ABN Amro Bank N.V., a private banking company. Since February 2022, Mr. Culverwell has served as a director and Audit Committee Chairman of TC BioPharm (Holdings) plc, a publicly traded company and a cancer treatment development company. Since January 2005, Mr. Culverwell has served as a director, Audit Committee Chairman, and member of the Compensation Committee of SafeGuard Biosystems, a high throughput molecular diagnostics company. From April 2016 to September 2019, Mr. Culverwell served as a director and Audit Committee Chairman of Amryt Pharma PLC, a publicly traded company and a commercial-stage biopharmaceutical company. From February 2013 to July 2017, Mr. Culverwell served as a director and Audit Committee Chairman of Innocoll AG. He received an MSc with honors from the University of Aberdeen. We believe Mr. Culverwell is qualified to serve on our Board due to his extensive experience serving on the audit and compensation committees for multiple public and private life sciences and healthcare companies.
Dennis H. Langer , M.D., J.D., Director . Dr. Langer has served as a director of Quoin Inc. since 2019. Dr. Langer has served as a director of Quoin Ltd. since October 28, 2021. From 2005 to 2010, Dr. Langer served as a Managing Partner at Phoenix IP Ventures, LLC, a private equity and venture capital fund specializing in life sciences companies. From 2005 to 2010, Dr. Langer was also a Co-Founder and Director of Ception Therapeutics, Inc., until its acquisition by Cephalon, Inc. From 2004 to 2005, Dr. Langer was the President, North America for Dr. Reddy’s Laboratories, Inc., a multi-national pharmaceutical company. Dr. Langer was with GlaxoSmithKline, a multi-national pharmaceutical and biotechnology company, from 1994 - 2004, where he served as Senior Vice President, Project, Portfolio and Alliance Management, Senior Vice President, Product Development Strategy, and Senior Vice
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President, Healthcare Services R&D. From 1991 to 1994, he served as President and Chief Executive Officer at Neose Technologies, Inc., a clinical stage biopharmaceutical company. From 2004 to June 2022, Dr. Langer served as a director of Myriad Genetics, Inc., a publicly traded company and a genetic testing and precision medicine company. From 2021 to June 2022, Dr. Langer served as a director of Brooklyn ImmunoTherapeutics, Inc. (n/k/a Eterna Therapeutics Inc.), a publicly traded company and a biotechnology company. From 2007 to 2019, Dr. Langer served as a director of Dicerna Pharmaceuticals Inc., a publicly traded company and a biopharmaceutical company. From 2005 to 2006, Dr. Langer served as a Director of Sirna Therapeutics, Inc., a publicly traded company and biopharmaceutical company, until its acquisition by Merck and Co., Inc. Dr. Langer has served on the Dean’s Advisory Board of Harvard Law School since 2010, and as a Director of the Whitehead Institute for Biomedical Research since 2020. He received an M.D. from Georgetown University School of Medicine, a J.D. from Harvard Law School, and a B.A. in Biology from Columbia University. We believe Dr. Langer is qualified to serve on our Board due to his extensive experience as an executive and board member of public and private life sciences and healthcare companies.
Natalie Leong , Director . Ms. Leong has served as a director of Quoin Inc. since April 2021. Ms. Leong has served as a director of Quoin Ltd. since October 28, 2021. Since January 2023, Ms. Leong has been the Senior Vice President of Product Management for B.S.D. Capital, Inc. (d/b/a Lendistry), a minority-led small business lender. Ms. Leong was the Head of Finance and Product Strategy (October 2019 – October 2020) and subsequently Head of Product Management (October 2020 – November 2022) for LoanStreet Inc., a financial SaaS company. From May 2016 to July 2019, Ms. Leong served as the Lead for the Asset Liability Committee for the US at RBC Capital Markets. In addition, from August 2018 to October 2019, she served as the Lead for Global Originations FP&A for RBC Capital Markets. From October 2011 to May 2016, Ms. Leong worked as the Vice President of Capital Insights at National Australia Bank. From February 2008 to October 2011, Ms. Leong served as a Senior Auditor at National Australia Bank. Ms. Leong earned her MBA at The Wharton School, University of Pennsylvania. She earned a B.Comm degree (Finance and Economics) and a B.A. degree (French and Literature) from the University of Melbourne in 2007. We believe Ms. Leong is qualified to serve on our Board due to her extensive financial and business management experience.
Michael Sember , Director . Mr. Sember has served as a director of Quoin Inc. since May 2021. Mr. Sember has served as a director of Quoin Ltd. since October 28, 2021. Since 2007, he has served as a Principal of Accela Advisors, a biopharmaceutical consulting firm specializing in strategic planning, business development and coaching for startups. From 2022 until 2023, Mr. Sember served as the Chief Executive Officer of RaeSedo, Inc, a startup therapeutics company spin out of the University of Arizona. From January 2018 to October 2020, Mr. Sember served as the Chief Executive Officer of Regulonix Holding, Inc., a drug development company. From October 2015 to March 2019, he served as the Mentor in Residence to companies formed from inventions discovered at the University of Arizona. From 2013 to 2015, Mr. Sember was the Corporate Turnaround Specialist and Chief Executive Officer of Palyon Medical Corporation, a drug delivery system company. From 1991 to 2002, Mr. Sember was Executive Vice President of Corporate Business Development for Élan Corporation, responsible for strategic collaborations and mergers and acquisitions. From 1973 to 1991, Mr. Sember served as the Senior director of Global Program Management at Marion Laboratories (later Marion Merrell Dow). From 2013 to 2015, Mr. Sember was the Chairman of the Board of Paylon Medical Corporation, a drug delivery system company. From 2012 to 2013, Mr. Sember was the Chairman of the Board of BioIndustry Organization of Southern Arizona, a non-profit trade group. Mr. Sember earned a Bachelor of Science degree from the University of Pittsburgh and an MBA from Rockhurst University. We believe Mr. Sember is qualified to serve on our Board due to his broad executive and capital raising experience in the life sciences industry.
Directors’ Term of Office
Directors hold office until the next annual meeting of shareholders and until a successor is duly elected and qualified or until his or her earlier retirement, resignation or removal.
Code of Ethics
We have adopted a Code of Ethics and Business Conduct (the “Code of Ethics”) that applies to all of our directors, officers and employees, including our principal executive officer and our principal financial and accounting officer. A copy of our Code of Ethics has been posted to the “Investors—Corporate Governance” section of our website www.quoinpharma.com, and it is attached as an exhibit to this Annual Report. If we make any amendment to the Code of Ethics or grant any waivers, including any implicit waiver, from a provision of the Code of Ethics, we will disclose the nature of such amendment or waiver on our website www.quoinpharma.com. to the extent required by the rules and regulations of the SEC. The information on the website is not and should not be considered part of this Annual Report and is not incorporated by reference in this annual Report.
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Board of Directors
The Board of Directors has established three standing committees: the Audit Committee, the Compensation Committee and the Nominating and Governance Committee.
Audit Committee
The Audit Committee of the Board of Directors consists of Joseph Cooper, James Culverwell, and Natalie Leong, with Mr. Culverwell chairing the committee.
Under the Nasdaq listing standards, we are required to maintain an audit committee consisting of at least three independent directors, each of whom is financially literate and one of whom has accounting or related financial management expertise. Our Board has determined that each member of the Audit Committee satisfies the independence requirements under Nasdaq listing standards and Rule 10A-3(b)(1) of the Exchange Act, has the requisite financial sophistication as required by the Nasdaq listing standards and is an audit committee financial expert, as defined by the SEC rules.
Our Board adopted the Amended and Restated Charter of the Audit Committee that sets forth the responsibilities of the Audit Committee under Nasdaq listing standards, as well as the requirements for such committee under the Companies Law, including the following:
● overseeing our independent registered public accounting firm and recommending the engagement, compensation or termination of engagement of our independent registered public accounting firm to the board of directors in accordance with Israeli law;
● recommending the engagement or termination of the person filling the office of our internal auditor;
● recommending the terms of audit and non-audit services provided by the independent registered public accounting firm for pre-approval by our board of directors;
● determining whether there are deficiencies in the business management practices of our company, including in consultation with our internal auditor or the independent auditor, and making recommendations to the board of directors to improve such practices;
● determining the approval process for transactions that are ‘non-negligible’ (i.e., transactions with a controlling shareholder that are classified by the audit committee as non-negligible, even though they are not deemed extraordinary transactions), as well as determining which types of transactions would require the approval of the audit committee, which determination may be based on annually pre-determined criteria;
● determining whether to approve certain related party transactions (including transactions in which an office holder (as defined below) has a personal interest and whether such transaction is extraordinary or material under the Companies Law);
● review and discuss the Company’s policies regarding information technology security and protection from cyber risks;
● examining the work plan of the internal auditor before its submission to our board of directors and proposing amendments thereto or, upon a decision of the board of directors, acting as the corporate body to approve such work plan;
● examining our internal controls and internal auditor’s performance, including whether the internal auditor has sufficient resources and tools at his disposal to fulfill his responsibilities;
● examining the scope of our independent auditor’s work and compensation and submitting a recommendation with respect thereto to our board of directors; and
● establishing procedures for the handling of employees’ complaints as to the management of our business and the protection to be provided to such employees.
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Compensation Committee
The Compensation Committee of the Board consists of James Culverwell, Dennis Langer and Michael Sember, with Dr. Langer chairing the committee. The Board of Directors has determined that each member of the Compensation Committee is independent under Nasdaq listing standards.
Our Board adopted the Amended and Restated Charter of the Compensation Committee that sets forth the responsibilities of such committee under Nasdaq listing standards, as well as the requirements for such committee under the Companies Law, including the following:
● recommending to our board of directors a policy regarding the terms of engagement of the company’s office holders, to which we refer as a “compensation policy”;
● recommending whether the compensation policy should continue in effect, if the then-current policy has a term of greater than three years (approval of either a new compensation policy or the continuation of an existing compensation policy must in any case occur every three years);
● recommending to the board of directors updates to the compensation policy from time to time;
● assessing implementation of the compensation policy;
● resolving whether to approve arrangements with respect to the terms of office and employment of office holders, which require the approval of the compensation committee pursuant to the Companies Law;
● exempting, under certain circumstances, a transaction with our Chief Executive Officer from the approval of our shareholders.;
● making other determinations that the Companies Law assigns to a compensation committee;
● reviewing and recommending for approval by the board of directors the overall compensation policies with respect to our Chief Executive Officer and other executive officers;
● reviewing and recommending for approval by the board of directors the corporate goals and objectives relevant to the compensation of our Chief Executive Officer and other executive officers;
● evaluating the performance of our Chief Executive Officer and other executive officers in light of such goals and objectives;
● reviewing and approving the granting of options and other incentive awards, including the exercise of authorities delegated by the board of directors regarding the grant of equity incentives under our equity compensation plans;
● reviewing, evaluating and making recommendations regarding the compensation and benefits for our non-employee directors;
● overseeing our compliance with SEC and Nasdaq rules related to shareholder approval of certain executive compensation matters and equity compensation plans;
● considering and implementing policies with respect to oversight, assessment and management of risks associated with our compensation polices; and
● reviewing and establishing appropriate insurance coverage for our office holders.
Nominating and Governance Committee
Our Nominating and Governance Committee consists of Natalie Leong and Joseph Cooper, with Ms. Leong chairing the committee. The Board of Directors has determined that each member of the Nominating and Governance Committee is independent under Nasdaq listing standards.
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Our Board adopted the Amended and Restated Charter of the Nominating and Governance Committee that sets forth the responsibilities of such committee under Nasdaq listing standards, as well as the requirements for such committee under the Companies Law, including the following:
● evaluating our corporate leadership structure, and reviewing important issues and developments in corporate governance, and developing appropriate recommendations for the Board; and
● overseeing and assisting our board in reviewing and recommending nominees for election as directors and members of committees of our board.
Internal Auditor
As required under the Companies Law by virtue of being a public company, the board of directors has appointed an internal auditor based on the recommendation of the audit committee. The role of the internal auditor is, among other things, to review the company’s compliance with applicable law and orderly business procedure. Under the Companies Law, the internal auditor cannot be an interested party, an office holder, or a relative of an interested party or an office holder. Nor may the internal auditor be the company’s independent auditor or its representative. An “interested party” is defined in the Companies Law as (i) a holder of 5% or more of the issued share capital or voting power in a company, (ii) any person or entity who has the right to designate one or more directors or to designate the chief executive officer of the company, or (iii) any person who serves as a director or as chief executive officer of the company. The role of the internal auditor is to examine, among other things, our compliance with applicable law and orderly business procedures. The audit committee is required to oversee the activities of the internal auditor and to assess his or her work plan and performance.
Insider Trading Policy
The Company maintains an Insider Trading Policy governing the purchase, sale and other disposition of its securities by its officers, directors and employees. The Company believes its Insider Trading Policy is reasonably designed to promote compliance with insider trading laws, rules and regulations, as well as the Nasdaq listing standards applicable to the Company. The Insider Trading Policy prohibits trading while in possession of material, non-public information and during blackout periods. While the Company’s executive officers and directors are not required to enter into trading plans in advance of any transactions in Company securities, executive officers and directors are permitted to enter into trading plans that are intended to comply with the requirements of Rule 10b5-1 of the Exchange Act. The Insider Trading Policy requires all directors, officers and certain other specified employees who have regular access to material, non-public information about the Company in the normal course of their duties to comply with pre-clearance procedures prior to engaging in any transaction in Company securities. The Insider Trading Policy also requires the Company to comply with all insider trading laws, rules and regulations, and any applicable listing standards when engaging in transactions in its own securities. A copy of our Insider Trading Policy is attached as an exhibit to this Annual Report.
Fiduciary Duties of Directors, Executive Officers and Shareholders
The Companies Law codifies the fiduciary duties that office holders owe to a company. An office holder is defined in the Companies Law as a general manager, chief business manager, deputy general manager, vice general manager, any other person assuming the responsibilities of any of these positions regardless of such person’s title, a director, and any other manager directly subordinate to the general manager. Each person listed in the table under “Management” is an office holder under the Companies Law.
An office holder’s fiduciary duties consist of a duty of care and a duty of loyalty. The duty of care requires an office holder to act with the level of care with which a reasonable office holder in the same position would act under the same circumstances. The duty of loyalty requires that an office holder act in good faith and in the best interests of the company.
The duty of care includes a duty to use reasonable means to obtain:
● information on the advisability of a given action brought for the office holder’s approval or performed by virtue of his or her position; and
● all other important information pertaining to any such action.
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The duty of loyalty includes a duty to:
● refrain from any conflict of interest between the performance of the office holder’s duties to the company and his or her other duties or personal affairs;
● refrain from any activity that is competitive with the company;
● refrain from exploiting any business opportunity of the company to receive a personal gain for himself or herself or others; and
● disclose to the company any information or documents relating to the company’s affairs which the office holder received as a result of his or her position as an office holder.
Shareholder duties
Pursuant to the Companies Law, a shareholder has a duty to act in good faith and in a customary manner toward the company and other shareholders and to refrain from abusing his or her power with respect to the company, including, among other things, in voting at a general meeting and at shareholder class meetings with respect to the following matters:
● an amendment to the company’s articles of association;
● an increase of the company’s authorized share capital;
● a merger; or
● interested party transactions that require shareholder approval.
In addition, a shareholder has a general duty to refrain from discriminating against other shareholders.
Certain shareholders also have a duty of fairness toward the company. These shareholders include any controlling shareholder, any shareholder who knows that it has the power to determine the outcome of a shareholder vote, and any shareholder who has the power to appoint or to prevent the appointment of an office holder of the company or exercise any other rights available to it under the company’s articles of association with respect to the company. The Companies Law does not define the substance of this duty of fairness, except to state that the remedies generally available upon a breach of contract will also apply in the event of a breach of the duty of fairness.
Disclosure of Personal Interests of an Office Holder and Approval of Certain Transactions
The Companies Law requires that an office holder promptly disclose to the board of directors any personal interest and all related material information known to such office holder concerning any existing or proposed transaction with the company. A personal interest includes an interest of any person in an act or transaction of a company, including a personal interest of one’s relative or of a corporate body in which such person or a relative of such person is a 5% or greater shareholder, director, or general manager or in which such person has the right to appoint at least one director or the general manager, but excluding a personal interest stemming solely from one’s ownership of shares in the company. A personal interest includes the personal interest of a person for whom the office holder holds a voting proxy or the personal interest of the office holder with respect to the officer holder’s vote on behalf of a person for whom he or she holds a proxy even if such shareholder has no personal interest in the matter.
If it is determined that an office holder has a personal interest in a non-extraordinary transaction (meaning any transaction that is in the ordinary course of business, on market terms or that is not likely to have a material impact on the company’s profitability, assets or liabilities), approval by the board of directors is required for the transaction unless the company’s articles of association provide for a different method of approval. Any such transaction that is adverse to the company’s interests may not be approved by the board of directors.
Approval first by the company’s audit committee and subsequently by the board of directors is required for an extraordinary transaction (meaning any transaction that is not in the ordinary course of business, not on market terms or that is likely to have a material impact on the company’s profitability, assets or liabilities) in which an office holder has a personal interest.
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A director and any other office holder who has a personal interest in a transaction which is considered at a meeting of the board of directors or the audit committee may generally (unless it is with respect to a transaction which is not an extraordinary transaction) not be present at such a meeting or vote on that matter unless a majority of the directors or members of the audit committee, as applicable, have a personal interest in the matter. If a majority of the members of the audit committee or the board of directors have a personal interest in the matter, then all of the directors may participate in deliberations of the audit committee or board of directors, as applicable, with respect to such transaction and vote on the approval thereof and, in such case, shareholder approval is also required.
Certain disclosure and approval requirements apply under Israeli law to certain transactions with controlling shareholders, certain transactions in which a controlling shareholder has a personal interest, and certain arrangements regarding the terms of service or employment of a controlling shareholder. For these purposes, a controlling shareholder is any shareholder that has the ability to direct the company’s actions, including any shareholder holding 25% or more of the voting rights if no other shareholder owns more than 50% of the voting rights in the company. Two or more shareholders with a personal interest in the approval of the same transaction are deemed to be one shareholder.
Exculpation, insurance and indemnification of office holders
Under the Companies Law, a company may not exculpate an office holder from liability for a breach of the duty of loyalty. An Israeli company may exculpate an office holder in advance from liability to the company, in whole or in part, for damages caused to the company as a result of a breach of duty of care, but only if a provision authorizing such exculpation is included in its articles of association. Our articles of association include such a provision. An Israeli company may not exculpate a director from liability arising out of a prohibited dividend or distribution to shareholders.
An Israeli company may indemnify an office holder from the following liabilities and expenses incurred for acts performed as an office holder, either in advance of an event or following an event, provided a provision authorizing such indemnification is contained in its articles of association:
● a financial liability imposed on him or her in favor of another person pursuant to a judgment, including a settlement or arbitrator’s award approved by a court. However, if an undertaking to indemnify an office holder with respect to such liability is provided in advance, then such an undertaking must be limited to events which, in the opinion of the board of directors, can be foreseen based on the company’s activities when the undertaking to indemnify is given, and to an amount or according to criteria determined by the board of directors as reasonable under the circumstances, and such undertaking shall detail the above mentioned events and amount or criteria;
● reasonable litigation expenses, including legal fees, incurred by the office holder (1) as a result of an investigation or proceeding instituted against him or her by an authority authorized to conduct such investigation or proceeding, provided that (i) no indictment was filed against such office holder as a result of such investigation or proceeding; and (ii) no financial liability, such as a criminal penalty, was imposed upon him or her as a substitute for the criminal proceeding as a result of such investigation or proceeding or, if such financial liability was imposed, it was imposed with respect to an offense that does not require proof of criminal intent; and (2) in connection with a monetary sanction;
● reasonable litigation expenses, including legal fees, incurred by the office holder or imposed by a court in proceedings instituted against him or her by the company, on its behalf or by a third-party or in connection with criminal proceedings in which the office holder was acquitted or as a result of a conviction for an offense that does not require proof of criminal intent;
● expenses, including reasonable litigation expenses and legal fees, incurred by an office holder in relation to an administrative proceeding instituted against such office holder, or certain compensation payments made to an injured party imposed on an office holder by an administrative proceeding, pursuant to certain provisions of the Israeli Securities Law; and
● expenses, including reasonable litigation expenses and legal fees, incurred by an office holder in relation to an administrative proceeding instituted against such office holder pursuant to certain provisions of the Israeli Economic Competition Law, 5758-1988.
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An Israeli company may insure an office holder against the following liabilities incurred for acts performed as an office holder if and to the extent provided in the company’s articles of association:
● a breach of the duty of loyalty to the company, to the extent that the office holder acted in good faith and had a reasonable basis to believe that the act would not prejudice the company;
● a breach of the duty of care to the company or to a third-party, including a breach arising out of the negligent conduct of the office holder;
● a financial liability imposed on the office holder in favor of a third-party;
● a financial liability imposed on the office holder in favor of a third-party harmed by a breach in an administrative proceeding, pursuant to certain provisions of the Israeli Securities Law; and
● expenses, including reasonable litigation expenses and legal fees, incurred by the office holder as a result of an administrative proceeding instituted against him or her, pursuant to certain provisions of the Israeli Securities Law.
An Israeli company may not exempt, indemnify or insure an office holder against any of the following:
● a breach of the duty of loyalty, except with respect to insurance coverage or indemnification, to the extent that the office holder acted in good faith and had a reasonable basis to believe that the act would not prejudice the company;
● a breach of the duty of care committed intentionally or recklessly, excluding a breach arising out of the negligent conduct of the office holder;
● an act or omission committed with intent to derive illegal personal benefit; or
● a fine, monetary sanction, or forfeit levied against the office holder.
Under the Companies Law, exculpation, indemnification, and insurance of office holders must be approved by the compensation committee and the board of directors (and, with respect to directors and the chief executive officer, by the shareholders). However, under regulations promulgated under the Companies Law, the insurance of office holders shall not require shareholder approval and may be approved by only the compensation committee if the engagement terms are determined in accordance with the company’s compensation policy, which was approved by the shareholders by the same special majority required to approve a compensation policy, provided that the insurance policy is on market terms and the insurance policy is not likely to materially impact the company’s profitability, assets, or obligations.
Our articles of association allow us to exculpate, indemnify, and insure our office holders to the maximum extent permitted by law. Our office holders are currently covered by a directors and officers’ liability insurance policy.
We have entered into agreements with each of our directors and executive officers exculpating them in advance, to the fullest extent permitted by law, from liability to us for damages caused to us as a result of a breach of duty of care, and undertaking to indemnify them to the fullest extent permitted by law. This indemnification is limited to events determined as foreseeable by the board of directors based on our activities and to an amount or according to criteria determined by the board of directors as reasonable under the circumstances.
In the opinion of the SEC, indemnification of directors and office holders for liabilities arising under the Securities Act, however, is against public policy and therefore unenforceable.
Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act and the regulations promulgated thereunder require our executive officers, directors and persons who beneficially own more than 10% of our ordinary shares to file forms with the SEC to report their ownership of the Company’s shares and any changes in ownership. We have reviewed all forms filed electronically with the SEC during, and with respect to, fiscal 2025 or prior years. Based on that review and written information given to us by all of our directors and executive officers, we believe that all of our directors, executive officers and holders of more than 10% of our stock filed on a timely basis all reports that they were
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required to file under Section 16(a) during fiscal 2025 other than as follows: (i) a late Form 4, covering one transaction, was filed late by James Culverwell; and (ii) a Form 3 was filed late by Sally Lawlor due to difficulty obtaining EDGAR filing codes.
Item 11. Executive Compensation
Summary Compensation Table
The following table sets forth information concerning the compensation awarded to, earned by, or paid to our Chief Executive Officer, Chief Operating Officer and Chief Financial Officer (collectively referred to as “named executive officers”) during the years ended December 31, 2025 and 2024.
Non Equity
Option
Incentive Plan
All Other
Name and
Salary
Bonus (2)
Awards (3)
Compensation (4)
Compensation (5)
Total
Principal Position
Year
($)
($)
($)
($)
($)
($)
Dr. Michael Myers
2025
745,284
—
331,285
372,642
58,134
1,507,345
Chief Executive Officer
2024
662,475
—
353,013
331,238
60,075
1,406,801
Denise Carter
2025
595,440
—
331,285
297,720
57,840
1,282,285
Chief Operating Officer
2024
529,980
—
353,017
264,990
63,625
1,211,612
Sally Lawlor (1)
2025
165,206
83,134
174,784
—
11,168
434,292
Chief Financial Officer
(1) Ms. Lawlor began serving as the Company’s Chief Financial Officer on August 18, 2025. Ms. Lawlor’s compensation is paid in Euros. For purposes of this table, we converted each element of her compensation into U.S. dollars based on the average foreign exchange rate for the period during which Ms. Lawlor was employed by the Company in 2025.
(2) Represents discretionary cash bonuses paid after the fiscal year with respect to that fiscal year’s performance. Each discretionary cash bonus was granted in recognition of the applicable officer’s promotion of our long-term goals, strategy and operating plan, the need to have appropriate incentives for our officers, and contribution to the achievement of our objectives in accordance with the applicable officer’s respective corporate role during the year. Ms. Lawlor’s fiscal 2025 discretionary cash bonus was approved by the Board and the Compensation Committee and was consistent with the Company’s 2025 Compensation Policy (as described below).
(3) Represents the grant date fair value of option awards granted to each of our named executive officers calculated in accordance with FASB ASC Topic 718. The option values were calculated using a Black-Scholes Model for pricing options. See Note 6 to the Consolidated Financial Statements included in this Annual Report for all relevant valuation assumptions used to determine the grant date fair value of these options.
(4) Represents annual performance-based cash bonuses paid after the fiscal year with respect to that fiscal year’s performance to Dr. Myers and Ms. Carter. See “─Annual Cash Incentive Bonuses.” Dr. Myers’ and Ms. Carter’s fiscal 2025 annual performance-based bonuses were approved by the Board and the Compensation Committee, were consistent with the Company’s 2025 Compensation Policy (as described below) and were within the limitations of the CEO Compensation Program (as described below) and the COO Compensation Program (as described below), as applicable.
(5) Represents amounts paid or accrued as office and automobile allowances, severance as well as the employer matching contribution to the executive’s 401(k) plan contributions under our Section 401(k) retirement plan (the “Section 401(k) Plan”) and PRSA Pension Scheme, broken down as follows:
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Office
Car
Medical
401(k)/PRSA
Allowance
Allowance
Allowance
Contributions
Total
($)
($)
($)
($)
($)
Michael Myers
2025
30,000
18,000
—
10,134
58,134
2024
30,000
18,000
—
12,075
60,075
Denise Carter
2025
30,000
18,000
—
9,840
57,840
2024
30,000
18,000
—
15,625
63,625
Sally Lawlor
2025
—
—
2,327
8,841
11,168
Employment Agreements
We entered into written employment agreements with our named executive officers that contain customary provisions, including non-compete and confidentiality provisions.
Dr. Myers. Pursuant to his Executive Employment Agreement with Quoin Inc., dated March 9, 2018, which was amended as of November 9, 2021 (as amended, the “Myers Agreement”), Dr. Myers’ annual base salary was set at $550,000. In addition, the Myers Agreement provided for target discretionary bonuses of not less than 45% of Dr. Myers’ so annual base salary, payable at the discretion of the board of directors after approval of the Compensation Committee, subject to shareholder approval by a Special Majority for Compensation Matters. Pursuant to the Myers Agreement, Dr. Myers is also eligible to receive healthcare benefits as may be provided from time to time by us to our employees generally, and to receive paid time off annually in accordance with our policies in effect from time to time. Additionally, the Myers Agreement provides Dr. Myers with a monthly office allowance of $2,500 and a monthly automobile allowance of $1,500. At the 2024 annual meeting of shareholders (the “2024 Annual Meeting”), the Company’s shareholders approved a compensation program for Dr. Myers. The program sets forth compensation limitations applicable to Dr. Myers which the Compensation Committee and the Board can utilize in setting Dr. Myers’ compensation, beginning with the compensation to be paid in fiscal 2024, without the need to obtain further shareholder approval. See “─Compensation Program for Dr. Michael Myers”.
After the 2024 Annual Meeting, the Compensation Committee and the Board took the following actions which were consistent with the Company’s then applicable compensation policy and within the limitations of the CEO Compensation Program: (i) approved and ratified Dr. Myers’ 2024 annual base salary at $662,475 (retroactive to January 1, 2024), (ii) approved and ratified a discretionary cash bonus for Dr. Myers for fiscal 2023 services of $301,125; and (iii) granted Dr. Myers an option to purchase 15,332 ADSs under Quoin’s Amended and Restated Equity Incentive Plan, with an exercise price equal to $27.30 per ADS. In 2025, the Compensation Committee and the Board took the following actions which were consistent with the Company’s then applicable compensation policy and within the limitations of the CEO Compensation Program: (i) approved and ratified Dr. Myers’ 2025 annual base salary at $745,284 (retroactive to January 1, 2025), (ii) approved and ratified a discretionary cash bonus for Dr. Myers for fiscal 2024 services of $331,238; and (iii) granted Dr. Myers an option to purchase 42,857 ADSs under Quoin’s Amended and Restated Equity Incentive Plan, with an exercise price equal to $9.07 per ADS. In February 2026, the Compensation Committee and the Board certified the achievement of 100% of the performance goals for Dr. Myers’ annual performance-based cash bonus, resulting in a cash bonus for Dr. Myers for fiscal 2025 services of $372,642. See “─Annual Cash Incentive Bonuses.” Dr. Myers’ annual performance-based bonus was consistent with the Company’s 2025 Compensation Policy (as described below) and was within the limitations of the CEO Compensation Program (as described below).
Ms. Carter. Pursuant to her Executive Employment Agreement with Quoin Inc., dated March 9, 2018, which was amended as of November 9, 2021 (as amended, the “Carter Agreement”), Ms. Carter’s annual base salary was set at $440,000, which accrued monthly until paid by Quoin Inc. In addition, the Carter Agreement provided for target discretionary bonuses of not less than 45% of Ms. Carter’s annual base salary, payable at the discretion of the board of directors after approval of the Compensation Committee, subject to shareholder approval by a Special Majority for Compensation Matters. Pursuant to the Carter Agreement, Ms. Carter is also eligible to receive healthcare benefits as may be provided from time to time by us to our employees generally, and to receive paid time off annually in accordance with Quoin’s policies in effect from time to time. Additionally, the Carter Agreement provides Ms. Carter with a monthly office allowance of $2,500 and a monthly automobile allowance of $1,500. At the 2024 Annual Meeting, the Company’s shareholders approved a compensation program for Ms. Carter. The program sets forth compensation limitations applicable to Ms. Carter which the Compensation Committee and the Board can utilize in setting Ms. Carter’s compensation, beginning with the compensation to be paid in fiscal 2024, without the need to obtain further shareholder approval. See “─Compensation Program for Ms. Denise Carter”.
After the 2024 Annual Meeting, the Compensation Committee and the Board took the following actions which were consistent with the Company’s then applicable compensation policy and within the limitations of the COO Compensation Program: (i) approved and
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ratified Ms. Carter’s 2024 annual base salary at $529,980 (retroactive to January 1, 2024), (ii) approved and ratified a discretionary cash bonus for Ms. Carter for fiscal 2023 services of $240,900; and (iii) granted Ms. Carter an option to purchase 15,332 ADSs under Quoin’s Amended and Restated Equity Incentive Plan, with an exercise price equal to $27.30 per ADS, the fair market value on the date of grant. In 2025, the Compensation Committee and the Board took the following actions which were consistent with the Company’s then applicable compensation policy and within the limitations of the COO Compensation Program: (i) approved and ratified Ms. Carter’s 2025 annual base salary at $595,440 (retroactive to January 1, 2025), (ii) approved and ratified a discretionary cash bonus for Ms. Carter for fiscal 2024 services of $264,990; and (iii) granted Ms. Carter an option to purchase 42,857 ADSs under Quoin’s Amended and Restated Equity Incentive Plan. In February 2026, the Compensation Committee and the Board certified the achievement of 100% of the performance goals for Ms. Carter’s annual performance-based cash bonus, resulting in a cash bonus for Ms. Carter for fiscal 2025 services of $297,720. See “─Annual Cash Incentive Bonuses.” Ms. Carter’s annual performance-based bonus was consistent with the Company’s 2025 Compensation Policy (as described below) and was within the limitations of the COO Compensation Program (as described below).
Ms. Lawlor. In connection with Ms. Lawlor’s appointment as Chief Financial Officer, the Company (through its wholly owned subsidiary, Quoin Therapeutics (Ireland) Ltd.) and Ms. Lawlor entered into a Service Agreement, dated as of August 18, 2025 (the “Lawlor Service Agreement”). The Lawlor Service Agreement provides that Ms. Lawlor will be paid an initial annual base salary of €380,000 ($443,381). In addition, the Service Agreement provides that the Company may, at its absolute discretion, pay an annual performance related bonus (which shall not qualify as pensionable remuneration) of up to 50% of salary in an amount to be determined by the Compensation Committee of Board. The Company has arranged for the provision of a PRSA scheme to which the Company will contribute 5% of gross basic salary matched by a 5% contribution by Ms. Lawlor to the PRSA. In addition, the Company will contribute a sum of €5,000 ($5,834) to Ms. Lawlor’s health insurance scheme. In connection with her hiring, on December 1, 2025, the Company granted Ms. Lawlor an option to purchase 10,330 ADSs under Quoin’s 2025 Equity Incentive Plan, with an exercise price equal to $19.36 per ADS. In February 2026, the Company’s Compensation Committee and the Board approved a discretionary cash bonus for Ms. Lawlor for fiscal 2025 services of $83,134. Ms. Lawlor’s discretionary cash bonus was consistent with the Company’s 2025 Compensation Policy (as described below).
Compensation Program for Dr. Michael Myers
At the 2024 Annual Meeting, the Company’s shareholders approved a compensation program for the Company’s Chief Executive Officer and Chairman of the Board, Dr. Michael Myers. The program sets forth the following compensation limitations applicable to Dr. Myers which the Compensation Committee and the Board can utilize in setting Dr. Myers’ compensation, beginning with the compensation to be paid in fiscal 2024, without the need to obtain further shareholder approval:
(i) an annual increase of base salary of up to 15% of Dr. Myers’ then effective base salary;
(ii) an annual cash bonus of up to 50% of Dr. Myers’ annual base salary during the fiscal year for which the annual cash bonus is paid (for example, Dr. Myers’ bonus to be paid in fiscal 2025 for fiscal 2024 services would be based upon a percentage, up to 50%, of Dr. Myers’ annual base salary in fiscal 2024); and
(iii) an annual equity grant in any form permitted under the Company’s equity incentive plan in effect from time to time with an annual value (determined in accordance with the Black-Scholes formula or another widely accepted and suitable formula for calculating the value of equity awards) of up to 500% of the maximum total fixed component (base salary and benefits) to which Dr. Myers is entitled in the grant year (together the “CEO Compensation Program”).
In setting future compensation for Dr. Myers consistent with the terms of the CEO Compensation Program, the Compensation Committee and the Board will continue to annually review market competitive compensation as a reference, individual performance, the need to have appropriate incentives for our officers, and Dr. Myers’ experience and expected contributions.
Compensation Program for Denise Carter
Also at the 2024 Annual Meeting, the Company’s shareholders approved a compensation program for the Company’s Chief Operating Officer and a member of the Board, Denise Carter. The program sets forth the following compensation limitations applicable to Ms. Carter which the Compensation Committee and the Board can utilize in setting Ms. Carter’s compensation, beginning with the compensation to be paid in fiscal 2024, without the need to obtain further shareholder approval:
(i) an annual increase of base salary of up to 15% of Ms. Carter’s then effective base salary;
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(ii) an annual cash bonus of up to 50% of Ms. Carter’s annual base salary during the fiscal year for which the annual cash bonus is paid (for example, Ms. Carter’s bonus to be paid in fiscal 2025 for fiscal 2024 services would be based upon a percentage, up to 50%, of Ms. Carter’s annual base salary in fiscal 2024); and
(iii) an annual equity grant in any form permitted under the Company’s equity incentive plan in effect from time to time with an annual value (determined in accordance with the Black-Scholes formula or another widely accepted and suitable formula for calculating the value of equity awards) of up to 500% of the maximum total fixed component (base salary and benefits) to which Ms. Carter is entitled in the grant year (together the “COO Compensation Program”).
In setting future compensation for Ms. Carter consistent with the terms of the CEO Compensation Program, the Compensation Committee and the Board will continue to annually review market competitive compensation as a reference, individual performance, the need to have appropriate incentives for our officers, and Ms. Carter’s experience and expected contributions.
Annual Cash Incentive Bonuses
The Company believes that performance-based cash bonuses assist the Company in motivating and retaining executive talent whose abilities and leadership skills are critical to the Company’s long-term success by aligning such officers’ efforts with the strategic and clinical goals of the Company through competitive annual incentive opportunities.
The annual performance-based cash bonuses for fiscal 2025 for Dr. Myers and Ms. Carter were subject to a formulaic framework based on certain clinical; regulatory; chemistry, manufacturing and controls; intellectual property and financial performance measures with weightings of 35%, 30%, 10%, 5% and 20%, respectively. There would be no annual performance-based cash bonus payout with respect to any category for which the Compensation Committee determined that the Company had not performed and/or did not successfully achieve the performance goal. We have not disclosed the specific performance goals/strategic measures because we believe this disclosure would reveal confidential strategic objectives and information that is not otherwise publicly disclosed by us and would result in competitive harm to us. The strategic measures were designed to be “stretch” goals that were achievable with what we believe represented an elevated level of effort and performance.
For fiscal 2025, the Compensation Committee and the Board set award levels for each of Dr. Myers and Ms. Carter as percentages of their base salaries as shown in the following table:
Target
(% of Base
Participant
Base Salary
Salary)
Michael Myers
$
745,284
50
%
Denise Carter
$
595,440
50
%
In February 2026, the Compensation Committee and the Board certified the achievement of 100% of the performance goals and determined that the annual performance-based cash bonuses should be paid out at 100% of target based on the Company’s performance. Accordingly, based on the formula previously adopted, the Compensation Committee and the Board approved bonuses for each of Dr. Myers and Ms. Carter for fiscal 2025 of $372,642 and $297,720, respectively.
Health and Welfare Benefits
Our named executive officers are eligible to participate in the same employee benefit plans, and on the same terms and conditions, as all other full-time, salaried U.S. employees. These benefits include medical, dental, and vision insurance, an employee assistance program, health and dependent care flexible spending accounts, basic life insurance, accidental death and dismemberment insurance, short-term and long-term disability insurance, and commuter benefits.
We also maintain the “Section 401(k) Plan that provides eligible employees, including our named executive officers, with an opportunity to save for retirement on a tax-advantaged basis. Eligible employees are able to participate in the Section 401(k) Plan as of the first day of the month following the date they meet the plan’s eligibility requirements. Participants are able to defer up to 100% of their eligible compensation subject to applicable annual limits under the Internal Revenue Code (the “Code”). All participants’ interests in their deferrals are 100% vested when contributed. Currently, we match up to 100% of a participant’s first 1% of his or her eligible contributions to the Section 401(k) Plan, and we match up to 50% of the next 5% of his or her eligible contributions.
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Outstanding Equity Awards at December 31, 2025
The following table sets forth information with respect to outstanding equity awards for each named executive officer as of December 31, 2025.
Number of
Number of
Securities
Securities
Underlying
Underlying
Option
Unexercised
Unexercised
Exercise
Option Grant
Options (#)
Options (#)
Price
Option
Name
Date
Exercisable
Unexercisable (1)
($) (2)
Expiration
Dr. Michael Myers
04/12/2022
153
51
7,350
04/12/2032
10/26/2023
926
1,388
201.25
10/26/2033
12/9/2024
3,066
12,266
27.30
12/9/2034
05/29/2025
—
42,857
9.07
5/29/2035
Denise Carter
04/12/2022
153
51
7,350
04/12/2032
10/26/2023
926
1,388
201.25
10/26/2033
12/9/2024
3,066
12,266
27.30
12/9/2034
05/29/2025
—
42,857
9.07
05/29/2035
Sally Lawlor
12/01/2025
—
10,330
19.36
12/01/2035
(1) Represents the number of ADSs issuable upon the exercise of options. The 2022 options vest in four equal annual installments beginning on April 12, 2023. The 2023 options vest in three annual installments of 20% beginning on October 26, 2024 and a fourth installment of 40% on October 26, 2027. The 2024 options vest in three annual installments of 20% beginning on December 9, 2025 and a fourth installment of 40% on December 9, 2028. The 2025 options vest in three annual installments of 20% beginning on either May 29, 2026 or December 1, 2026, as applicable, and a fourth installment of 40% on either May 29, 2029 or December 1, 2029, as applicable.
(2) Represents the exercise price per ADS.
Equity Plans
Amended and Restated Equity Incentive Plan
At our Annual General Meeting held on April 12, 2022, our shareholders approved our Amended and Restated Equity Incentive Plan (the “2022 Plan”), which amended and restated our 2014 Global Incentive Option Scheme. The purpose of the 2022 Plan was to attract, retain and motivate our employees (including prospective employees), non-employee directors and consultants. As of August 21, 2025, no further awards may be issued under the 2022 Plan due to the adoption of the Company’s 2025 Plan (as defined below). At December 31, 2025, 200,627 ADSs remain subject to outstanding options under the 2022 Plan.
2025 Equity Incentive Plan
Our 2025 Equity Incentive Plan (the “2025 Plan”) was approved by our shareholders on August 21, 2025. The purpose of the 2025 Plan is to provide for the grant of equity-based incentive awards to the Company’s employees, directors, officers, consultants, advisers and service providers in order to incentivize them to increase their efforts on behalf of the Company and to promote the success of the Company’s business. The 2025 Plan provides for the grant of stock options (including incentive stock options and nonqualified stock options), restricted shares, restricted stock units, stock appreciation rights and other share-based awards. The 2025 Plan is administered by the Compensation Committee.
Subject to certain adjustments, the maximum number of ordinary shares (or ADSs representing such ordinary shares) available for issuance under the 2025 Plan is 3,000,000 ordinary shares (85,714 ADSs), subject to an automatic annual increase the first day of each year beginning in 2026 and on January 1st of each calendar year thereafter and ending on January 1, 2035, by a number of ordinary shares equal to the smaller of (A) fifteen percent (15%) of the number of ordinary shares issued and outstanding of the Company on a fully diluted basis on the last day of the immediately preceding calendar year; and (B) such amount as determined by our Board if so determined.
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All awards granted pursuant to the 2025 Plan will be evidenced by a grant notification letter, in a form approved, from time to time, by the Compensation Committee. The grant notification letter will set forth the terms and conditions of the award, including the type of award, number of shares subject to such award, vesting schedule and conditions (including performance goals or measures) and the exercise price, if applicable. The exercise period of an award will be determined by the Compensation Committee and stated in the grant notification letter but will in no event be longer than ten years from the date of the grant thereof. All awards must be granted on or before July 8, 2035, the tenth anniversary of the date that the 2025 Plan was approved by our Board. All awards under the 2025 Plan will be subject to recoupment by the Company to the extent required to comply with applicable law or any policy of the Company (subject to applicable law) providing for the reimbursement of incentive compensation, whether or not such policy was in place at the time of grant of an award. At December 31, 2025, 15,330 ADSs remain subject to outstanding options under the 2025 Plan.
Company Policies and Practices Related to the Grant of Certain Equity Awards Close in Time to the Release of Material Nonpublic Information
The Company does not have a formal policy on the timing of awards of options in relation to the disclosure of material nonpublic information by the Company. The Board and the Compensation Committee does not seek to time equity grants to take advantage of information, either positive or negative, about our company that has not been publicly disclosed. Option grants are effective on the date the award determination is made by the Board and/or the Compensation Committee, and the exercise price of options is the closing market price of our ADSs on the date of the grant or, if the grant is made on a weekend or holiday, on the prior business day.
During the fiscal year ended December 31, 2025, we did not award any options to a named executive officer in the period beginning four business days before the filing of a periodic report on Form 10-Q or Form 10-K, or the filing or furnishing of a current report on Form 8-K that discloses material nonpublic information, and ending one business day after the filing or furnishing of such report other than as set forth in the table below:
Percentage change in the closing market price
of the securities underlying the award between
the trading day ending immediately prior to the
Number of
Exercise
Grant date
disclosure of material nonpublic information
securities
price of the
fair value
and the trading day beginning immediately
Grant
underlying
award per
of the
following the disclosure of material nonpublic
Name
date
the award
share
award
information (2)
James Culverwell
08/21/25 (1)
13,682
$
9.07
$
6.04
1.94
%
Dennis Langer
08/21/25 (1)
13,682
$
9.07
$
6.04
1.94
%
Natalie Leong
08/21/25 (1)
4,105
$
9.07
$
6.04
1.94
%
(1)
The option grant was approved by the Compensation Committee and the Board on May 29, 2025, subject to shareholder approval. The Company’s shareholders approved this option grant on August 21, 2025. The exercise price of the option was determined following the close of market on May 29, 2025.
(2)
The Company filed a current report on Form 8-K on August 21, 2025, announcing the results of the 2026 annual meeting and the appointment of Sally Lawlor as the Company’s new Chief Financial Officer effective as of August 18, 2025. The percentage change in the closing market price of the Company’s ADSs between the trading day ending immediately prior to the filing of the 8/21/2025 Form 8-K and the closing market price of the Company’s ADSs on the trading day beginning immediately following the filing of the 8/21/2025 Form 8-K was 1.94%.
Clawback Policy
The Board adopted a clawback policy which requires the clawback of erroneously awarded incentive-based compensation of past or current executive officers awarded during the three full fiscal years preceding the date on which the issuer is required to prepare an accounting restatement due to the material noncompliance of the Company with any financial reporting requirement under the federal securities laws. There is no fault or misconduct required to trigger a clawback.
The Compensation Committee shall determine, in its sole discretion, the timing and method for promptly recouping such erroneously awarded compensation, which may include without limitation: (a) seeking reimbursement of all or part of any cash or equity-based award, (b) cancelling prior cash or equity-based awards, whether vested or unvested or paid or unpaid, (c) cancelling or offsetting against any planned future cash or equity-based awards, (d) forfeiture of deferred compensation, subject to compliance with Section 409A of the Internal Revenue Code and the regulations promulgated thereunder, and (e) any other method authorized by
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applicable law or contract. Subject to compliance with any applicable law, the Compensation Committee may affect recovery under this policy from any amount otherwise payable to the executive officer, including amounts payable to such individual under any otherwise applicable Company plan or program, including base salary, bonuses or commissions and compensation previously deferred by the executive officer.
Potential Payments Upon Termination or in Connection With a Change of Control
Employment Agreements
Pursuant to each of the Myers Agreement and the Carter Agreement, Dr. Myers and Ms. Carter, respectively, are entitled to the following benefits upon termination of their employment:
● Termination for any reason: Upon the termination of such executive’s employment for any reason, such executive will receive (i) his or her Base Salary (as defined in the Myers Agreement or the Carter Agreement, as applicable) through the Exit Date (as defined in the Myers Agreement or the Carter Agreement, as applicable), (ii) any Bonuses (as defined in the Myers Agreement or the Carter Agreement, as applicable) to which he or she is entitled and has already earned for the prior fiscal year, and (iii) any other accrued or vested benefits or reimbursements through the Exit Date to which such executive is entitled to contractually or by operation of law.
● Termination upon death or Disability: In the event of the executive’s termination due to his or her death or Disability (as defined in the Myers Agreement or the Carter Agreement, as applicable), then, in addition to the payments set forth above, the executive will receive his or her pro rata portion of the Bonus such executive would have been entitled to receive for the fiscal year in which the Exit Date occurs, based upon the percentage of the fiscal year that elapsed through the Exit Date. Additionally, in the event of termination due to Disability, the executive will receive, for a period of 24 months following the Exit Date, such executive monthly COBRA premium.
● Termination without Cause or for Good Reason: In addition to the payments set forth in the first bullet above, if Dr. Myers or Ms. Carter is terminated by the Company without Cause (as defined in the Myers Agreement or the Carter Agreement, as applicable), or Dr. Myers or Ms. Carter terminates his or her employment for Good Reason (as defined in the Myers Agreement or the Carter Agreement, as applicable), he or she will be entitled to receive (i) his or her Base Salary for 2 years from the Exit Date and 2 times the current years’ Bonus, and (ii) continuation of such executive’s medical benefits for 2 years from the Exit Date (unless the executive becomes employed elsewhere during such 2 year period and is eligible to receive comparable medical benefits).
As a condition precedent to receiving any of the foregoing benefits, Dr. Myers and/or Ms. Carter, as applicable, must first sign a Release (as defined in the Myers Agreement or the Carter Agreement, as applicable).
The foregoing descriptions of the Myers Agreement and the Carter Agreement do not purport to be complete and are qualified in their entirety by reference to the complete text of the Myers Agreement the Carter Agreement, copies of which are included as exhibits to this Annual Report.
Option Awards
Under the 2022 Plan and the 2025 Plan, upon termination of employment for any reason, other than in the event of death or disability or for “Cause” (as defined in the 2022 Plan and the 2025 Plan), all unvested options will expire and all vested options at time of termination will generally be exercisable for 90 days following termination, subject to the terms of the Plan and the governing option agreement. If we terminate a grantee for Cause, the grantee’s right to exercise all vested and unvested the options granted to the grantee will expire immediately. Upon termination of employment due to death or disability, all the vested options at the time of termination will be exercisable for 12 months after date of termination, subject to the terms of the 2022 Plan and the 2025 Plan and the governing option agreement.
Compensation Policy under the Companies Law
In general, under the Companies Law, a public company must have a compensation policy approved by the board of directors after receiving and considering the recommendations of the compensation committee. In addition, our compensation policy must be approved
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at least once every three years, first, by our board of directors, upon the recommendation of our compensation committee, and second, by a simple majority of the ordinary shares present, in person or by proxy, and voting (excluding abstentions) at a general meeting of shareholders, provided that either:
● such majority includes at least a majority of the shares held by shareholders who are not controlling shareholders and shareholders who do not have a personal interest in such compensation policy; or
● the total number of shares of non-controlling shareholders and shareholders who do not have a personal interest in the compensation policy and who vote against the policy does not exceed two percent (2%) of the aggregate voting rights in the Company.
Under special circumstances, the board of directors may approve the compensation policy despite the objection of the shareholders on the condition that the compensation committee and then the board of directors decide, on the basis of detailed grounds and after discussing again the compensation policy, that approval of the compensation policy, despite the objection of shareholders, is for the benefit of the company. Our Board, following the recommendation of our Compensation Committee, approved adopting a new Compensation Policy for Executive Officer and Directors in 2025 (the “2025 Compensation Policy”) and our shareholders approved and adopted the 2025 Compensation Policy at our 2025 Annual Meeting. The compensation policy must be based on certain considerations, include certain provisions and reference certain matters as set forth in the Companies Law. The compensation policy must serve as the basis for decisions concerning the financial terms of employment or engagement of office holders, including exculpation, insurance, indemnification or any monetary payment or obligation of payment in respect of employment or engagement. The compensation policy must be determined and later reevaluated according to certain factors, including: the advancement of the company’s objectives, business plan and long-term strategy; the creation of appropriate incentives for office holders, while considering, among other things, the company’s risk management policy; the size and the nature of the company’s operations; and with respect to variable compensation, the contribution of the office holder towards the achievement of the company’s long-term goals and the maximization of its profits, all with a long-term objective and according to the position of the office holder. The compensation policy must furthermore consider the following additional factors:
● the education, skills, experience, expertise and accomplishments of the relevant office holder;
● the office holder’s position and responsibilities;
● prior compensation agreements with the office holder;
● the ratio between the cost of the terms of employment of an office holder and the cost of the employment of other employees of the company, including employees employed through contractors who provide services to the company, in particular the ratio between such cost to the average and median salary of such employees of the company, as well as the impact of disparities between them on the work relationships in the company;
● if the terms of employment include variable components — the possibility of reducing variable components at the discretion of the board of directors and the possibility of setting a limit on the value of non-cash variable equity-based components; and
● if the terms of employment include severance compensation — the term of employment or office of the office holder, the terms of the office holder’s compensation during such period, the company’s performance during such period, the office holder’s individual contribution to the achievement of the company goals and the maximization of its profits and the circumstances under which he or she is leaving the company.
The compensation policy must also include, among other things:
● with regards to variable components:
● with the exception of office holders who report to the chief executive officer, a means of determining the variable components on the basis of long-term performance and measurable criteria; provided that the company may determine that an immaterial part of the variable components of the compensation package of an office holder shall be awarded based on non-measurable criteria, or if such amount is not higher than three months’ salary per annum, taking into account such office holder’s contribution to the company;
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● the ratio between variable and fixed components, as well as the limit of the values of variable components at the time of their payment, or in the case of equity-based compensation, at the time of grant;
● a condition under which the office holder will return to the company, according to conditions to be set forth in the compensation policy, any amounts paid as part of the office holder’s terms of employment, if such amounts were paid based on information later to be discovered to be wrong, and such information was restated in the company’s financial statements;
● the minimum holding or vesting period of variable equity-based components to be set in the terms of office or employment, as applicable, while taking into consideration long-term incentives; and
● a limit to retirement grants.
Our compensation policy is designed to promote retention and motivation of directors and executive officers, incentivize superior individual excellence, align the interests of our directors and executive officers with our long-term performance and provide a risk management tool. To that end, a portion of our executive officer compensation package is targeted to reflect our short and long-term goals, as well as the executive officer’s individual performance. On the other hand, our compensation policy includes measures designed to reduce the executive officer’s incentives to take excessive risks that may harm us in the long-term, such as limits on the value of cash bonuses and equity-based compensation, limitations on the ratio between the variable and the total compensation of an executive officer and minimum vesting periods for equity-based compensation.
Our compensation policy also addresses our executive officers’ individual characteristics (such as their respective position, education, scope of responsibilities and contribution to the attainment of our goals) as the basis for compensation variation among our executive officers and considers the internal ratios between compensation of our executive officers and directors and other employees. Pursuant to our compensation policy, the compensation that may be granted to an executive officer may include: base salary, annual bonuses and other cash bonuses (such as a signing bonus and special bonuses with respect to significant events, such as a significant partnership, collaboration agreement or the generation of positive clinical trial results or regulatory approval of one of the Company’s products), equity-based compensation and termination of service grants.
An annual cash bonus may be awarded to executive officers upon the attainment of pre-set periodic objectives and individual targets. The annual cash bonus that may be granted to our executive officers is based primarily on measurable short- and long-term criteria. A non-material part of variable compensation for executive officers may be based on qualitative or non-measurable criteria which focus on the executive officer’s contribution to the Company, subject to a maximum amount linked to the executive officer’s base salary.
The equity-based compensation under our compensation policy for our executive officers is designed in a manner consistent with the underlying objectives in determining the base salary and the annual cash bonus, with its main objectives being to enhance the alignment between the executive officers’ interests with our long-term interests and those of our shareholders and to strengthen the retention and the motivation of executive officers in the long term. Our compensation policy provides for equity compensation in any form permitted under our equity incentive plan then in place. The equity-based compensation shall be granted from time to time and be individually determined and awarded according to the performance, educational background, prior business experience, qualifications, role and the personal responsibilities of the executive officer.
In addition, our compensation policy contains compensation recovery provisions which allow us under certain conditions to recover bonuses paid in excess, enables our chief executive officer to approve an immaterial change in the terms of employment of an executive officer (excluding the chief executive officer) in an amount up to two monthly base salaries, and allow us to exculpate, indemnify and insure our executive officers and directors to the maximum extent permitted by Israeli law subject to certain limitations set forth therein.
Our compensation policy also provides for compensation to the members of our board of directors in accordance with market compensation trends, provided however that in the case of an external director, such compensation will be paid in accordance with the amounts provided in the Companies Regulations (Rules Regarding the Compensation and Expenses of an External Director) of 2000, as amended by the Companies Regulations (Relief for Public Companies Traded in Stock Exchange Outside of Israel) of 2000, as such regulations may be amended from time to time.
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Non-Employee Director Compensation
Under our non-employee directors’ compensation program, as amended, non-employee directors are entitled to receive the following cash compensation for their services:
● each non-employee director receives an annual base retainer (the “Annual Retainer”) of up to $125,000, which amount shall be determined annually at the discretion of the Compensation Committee and the Board;
● each committee chairperson receives an additional retainer of $15,000 for his or her service as a chairperson; and
● each member of a standing committee receives an additional retainer of $5,000 for such service on a standing committee.
In addition to cash compensation, our non-employee directors are also entitled to equity awards under our director compensation policy. Each non-employee director is entitled to receive an annual award of options with a value of no less than $20,000 and no more than $60,000, with such value being determined annually at the discretion of the Compensation Committee and the Board. In addition, each non-employee director who joins the Board is granted an inaugural award of options valued at $165,000. Furthermore, each non-employee director may elect to receive all or a portion of the Annual Retainer due to them in the form of options.
The following table sets forth information concerning the compensation awarded to, earned by or paid to non-employee directors for the year ended December 31, 2025.
Fees Earned or
Option
Paid in Cash
Awards
Total
Name
($) (1)
($) (1)(2)
($)
Joseph Cooper
110,000
59,985
169,985
James Culverwell
20,000
142,624
162,624
Dr. Dennis H. Langer
15,000
142,624
157,624
Natalie Leong
90,000
84,779
174,779
Michael Sember
105,000
59,985
164,985
(1) For fiscal 2025, the Compensation Committee and the Board set the Annual Retainer at $100,000 and determined that the annual award of options should be valued at $60,000. Each of Mr. Culverwell and Mr. Langer elected to receive all of their fiscal 2025 Annual Retainer in the form of options to purchase ADSs in the amount of 13,682 ADSs each and Ms. Leong elected to receive a portion of her fiscal 2025 Annual Retainer in the form of options to purchase ADSs in the amount of 4,105 ADSs. Committee fees were paid in cash to all Board members.
(2) Represents the grant date fair value of option awards granted to each of our non-employee directors calculated in accordance with FASB ASC Topic 718. The option values were calculated using a Black-Scholes Model for pricing options. See Note 6 to Consolidated Financial Statements included in this Annual Report for all relevant valuation assumptions used to determine the grant date fair value of these options. As of December 31, 2025, the aggregate number of outstanding options held by each of our non-employee directors was Mr. Cooper—9,459; Mr. Culverwell—23,141; Dr. Langer—23,141; Ms. Leong 13,561; and Mr. Sember—9,459.
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Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Security Ownership of Certain Beneficial Owners and Management 1
The following table sets forth information relating to the beneficial ownership of our ordinary shares (including ordinary shares represented by ADSs) as of March 23, 2026 by:
● each person, or group of affiliated persons, known by us to own beneficially 5% or more of our outstanding ordinary shares;
● each of our directors and named executive officers; and
● all of our directors and officers as a group.
Beneficial ownership is determined in accordance with the rules of the SEC and generally means sole or shared power to vote or direct the voting or to dispose or direct the disposition of any security. Unless otherwise indicated in the footnotes to this table, we believe that each of the persons named in this table has sole voting and investment power with respect to the securities indicated as being beneficially owned.
Except as indicated by footnote, the beneficial ownership information is based upon 1,803,626 ordinary shares outstanding as of March 23, 2026. A security that may be acquired by a person within 60 days of March 23, 2026, pursuant to the exercise of options or warrants are deemed to be outstanding for purpose of computing the percentage ownership of such person, but are not deemed to be outstanding for purposes of computing the percentage ownership of ordinary shares beneficially owned by any other person shown in the table. Each ADS represents thirty-five ordinary shares.
Unless indicated otherwise below, the address of our directors and executive officers is c/o Quoin Pharmaceuticals Ltd., 42127 Pleasant Forest Court, Ashburn, VA 20148-7349.
Amount and Nature of Beneficial
Percentage
Name and Address of Beneficial Owner
Ownership
of Class
5% Beneficial Owners
Ikarian Capital LLC and affiliate (1)
211,538
11.73
%
Directors and Named Executive Officers:
Dr. Michael Myers (2)
53,165
2.95
%
Denise Carter (3)
53,160
2.95
%
Joseph Cooper (4)
408
0.02
%
James Culverwell (5)
8,989
0.50
%
Dr. Dennis Langer (6)
74,766
4.22
%
Natalie Leong (7)
408
0.02
%
Michael Sember (8)
408
0.02
%
Sally Lawlor (9)
440
0.02
%
All current directors and officers as a group (8 persons) (10)
191,745
10.71
%
(1) Consists of ADSs held by Ikarian Capital, LLC (“Ikarian”) based on the Schedule 13G/A filed by Ikarian on February 6, 2026. These ADSs are also beneficially owned by Neil Shahrestani. The address of Ikarian and Mr. Shahrestani is c/o Ikarian Capital, LLC, 100 Crescent Court, Suite 1620, Dallas, Texas 75201
(2) Consists of (i) 17,223 ADSs held directly, (ii) 4,196 ADSs issuable upon the exercise of options which may be exercised within 60 days of March 23, 2026, (iii) 31,746 ADSs issuable upon the exercise of December 2024 Warrants acquired in the December 2024 Offering which may be exercised within 60 days of March 23, 2026
(3) Consists of (i) 17,219 ADSs held directly, (ii) 4,196 ADSs issuable upon the exercise of options which may be exercised within 60 days of March 23, 2026, and (iii) 31,746 ADSs issuable upon the exercise of December 2024 Warrants acquired in the December 2024 Offering which may be exercised within 60 days of March 23, 2026.
(4) Represents 408 ADSs issuable the upon exercise of options which may be exercised within 60 days of March 23, 2026.
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(5) Consists of (i) 2,866 ADSs held directly, (ii) 408 ADSs issuable upon the exercise of options which may be exercised within 60 days of March 23, 2026, and (iii) 5,714 ADSs issuable upon the exercise of December 2024 Warrants acquired in the December 2024 Offering which may be exercised within 60 days of March 23, 2026.
(6) Consists of (i) 15,154 ADSs held directly, (ii) 408 ADSs issuable upon the exercise of options which may be exercised within 60 days of March 23 2026 and (iii) 60,608 ADSs issuable upon the exercise of October 2025 Ordinary Warrants acquired in the October 2025 Private Placement which may be exercised within 60 days of March 23, 2026.
(7) Represents 408 ADSs issuable upon the exercise of options which may be exercised within 60 days of March 23, 2026.
(8) Represents 408 ADSs issuable upon the exercise of options which may be exercised within 60 days of March 23, 2026.
(9) Consists of 440 ADSs held directly.
(10) Consists of (i) 57,218 ADSs held directly, (ii) 10,853 ADSs issuable upon the exercise of options which may be exercised within 60 days of March 23, 2026, (iii) 76,190 ADSs issuable upon the exercise of December 2024 acquired in the December 2024 Offering and (iv) 60,608 ADSs issuable upon the exercise of October 2025 Ordinary Warrants acquired in the October 2025 Private Placement which may be exercised within 60 days of March 23, 2026.
Equity Compensation Plan Table
The following table summarizes our equity compensation plan information as of December 31, 2025.
Number of securities
authorized for
Number of securities
Weighted-average
future issuance under equity
to be issued upon exercise
exercise price of
compensation plans
of outstanding options,
outstanding options,
(excluding securities reflected
Plan category
warrants and rights (1)
warrants and rights (2)
in column (a) (1)(3)(4)
(a)
(b)
(c)
Equity compensation plans approved by security holders
215,957
$
42.83
70,384
Equity compensation plans not approved by security holders
─
─
─
Total
215,957
$
42.83
70,384
(1) Represents the number of ADSs issuable upon the exercise of options.
(2) Represents the exercise price per ADS.
(3) Represents the number of ADSs authorized for issuance under the 2025 Plan at December 31, 2025.
(4) The 2025 Plan contains an “ evergreen ” provision, pursuant to which on January 1 st of each year, we automatically increase the maximum number of shares authorized for issuance pursuant to the 2025 Plan by a number of shares equal to the smaller of (a) 15% of the number of shares issued and outstanding of the Company on a fully diluted basis on the last day of the immediately preceding calendar year; and (b) such amount as determined by our Board if so determined.
Item 13. Certain Relationships and Related Transactions, and Director Independence
Director Independence
Under the corporate governance standards of Nasdaq, a majority of our directors must meet the independence requirements specified in those rules. The Board determined that Joseph Cooper, James Culverwell, Dr. Dennis Langer, Natalie Leong, and Michael Sember, qualify as independent directors, as such term is defined under Nasdaq listing rules.
Certain Relationships and Related Transactions
Due to the limited funding of Quoin Inc. prior to the consummation of the Merger, the compensation, including salary, office and car allowances and other benefits, due to Dr. Myers and Ms. Carter under their respective employment agreements, as well as
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reimbursement of expenses and other amounts paid by Dr. Myers and Ms. Carter to third parties on behalf of Quoin Inc., were not paid by Quoin Inc. to Dr. Myers and Ms. Carter, and were accrued as indebtedness to Dr. Myers and Ms. Carter. Following the closing of the Merger, Quoin Inc. began making payments of $25,000 per month to each of Dr. Myers and Ms. Carter to repay the above-described non-interest-bearing indebtedness. We repaid $300,000 and $300,000 of such indebtedness to Dr. Myers, and $300,000 and $300,000 to Ms. Carter, during the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, approximately $1,359,000 and $965,000 of such indebtedness was outstanding to Dr. Myers and Ms. Carter, respectively.
On October 2, 2020, Quoin Inc. issued promissory notes (the “2020 Notes”) to five noteholders, including our directors, Messrs. Langer and Culverwell (collectively, “2020 Noteholders”). The 2020 Notes were mandatorily convertible into 12 ADSs, subject to adjustment and were converted in 2021. The ADSs issued to the 2020 Noteholders did not include accrued interest. Two of the five 2020 Noteholders received their amount due during the year ended December 31, 2022 and the Company’s estimate of the liability to the remaining three 2020 Noteholders (including Messrs. Langer and Culverwell) was estimated to be $1,146,000 as of December 31, 2025 and December 31, 2024.
On December 23, 2024, we completed the December 2024 Offering of our ordinary shares represented by ADSs, Series F Warrants to purchase ordinary shares represented by ADSs, Series G Warrants to purchase ordinary shares represented by ADSs and pre-funded warrants to purchase ordinary shares represented by ADSs. The Company received aggregate gross proceeds from the December 2024 Offering of approximately $6.8 million, before deducting placement agent fees and other offering expenses. Dr. Myers, Ms. Carter, Mr. Dunn and Mr. Culverwell purchased an aggregate of 38,095 ADSs and accompanying Series F Warrants and Series G Warrants to purchase an aggregate of 76,190 ADSs, for a total purchase price of approximately $600,000, at the public offering price and on the same terms as the other purchasers in the December 2024 Offering.
On October 14, 2025, we completed the October 2025 Private Placement of ordinary shares represented by ADSs, 2025 Pre-Funded Warrants, and October 2025 Ordinary Warrants. Dennis Langer, one of our directors, participated in the October 2025 Private Placement, purchasing ordinary shares represented by 15,152 ADSs and accompanying October 2025 Ordinary Warrants for a total purchase price of approximately $128,641, at a combined purchase price of $8.49 per ADS and accompanying October 2025 Ordinary Warrants. In accordance with Nasdaq Rules, Mr. Langer’s purchase price was based upon the consolidated closing bid price from the trading day immediately preceding the date we entered into the 2025 Purchase Agreements, plus $0.50.
Review, Approval and Ratification of Transactions with Related Persons
The general policy of Quoin Pharmaceuticals Ltd. and our audit committee is that all proposed related party transactions are reviewed and approved in advance by the audit committee to the extent required under the Companies Law and Nasdaq and other rules. The audit committee will determine whether such transactions or proposals are fair and reasonable to our company and our shareholders. In general, potential related-party transactions will be identified by our management and discussed with our audit committee at our audit committee’s meetings. Detailed proposals, including, where applicable, financial and legal analyses, alternatives and management recommendations, will be provided to our audit committee with respect to each issue under consideration and decisions will be made by our audit committee with respect to the foregoing related-party transactions after opportunity for discussion and review of materials. When applicable, our audit committee will request further information and, from time to time, will request guidance or confirmation from internal or external counsel or auditors.
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Item 14. Principal Accountant Fees and Services
CBIZ CPAs P.C. (“CBIZ CPAs”) and Marcum LLP (“Marcum”), served as the independent registered public accounting firms, for the fiscal years ended December 31, 2025 and 2024, respectively. Effective November 1, 2024, CBIZ CPAs acquired the attest business of Marcum. Marcum continued to serve as the Company’s independent registered public accounting firm through March 18, 2025. On March 18, 2025, Marcum resigned as the Company’s independent registered public accounting firm, and CBIZ CPAs was engaged to serve as the independent registered public accounting firm of the Company for the year ending December 31, 2025.
The following table sets forth the aggregate accounting fees paid by us to CBIZ CPAs for all services for the years ended December 31, 2025 and 2024, as applicable.
Year Ended
Year Ended
December 31, 2025
December 31, 2024
Type of Fees (a) (in thousands)
Audit Fees
$
250
$
—
Audit-Related Fees
—
—
Tax Fees
—
—
All Other Fees
—
—
Total
$
250
$
—
(a) The aggregate fees included in Audit Fees are fees billed for the fiscal years.
Audit Fees. Audit fees refer to the aggregate fees, including expenses, for the audit of our annual financial statements and review of financial statements included in our quarterly reports and other services that are normally provided in connection with statutory and regulatory filings or engagements.
Audit-Related Fees. Audit-Related fees refer to the aggregate fees, including expenses, for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements not reported under “Audit Fees” above.
Tax Fees. Our independent registered public accounting firm did not provide any tax services during the periods.
All Other Fees. Our independent registered public accounting firm did not provide any “other services” during the periods.
Pre-Approval Policy
Our audit committee has a pre-approval policy for the engagement of our independent registered public accounting firm to perform audit and non-audit services. Pursuant to this policy, which is designed to assure that such engagements do not impair the independence of our auditors, the audit committee pre-approves annually a catalog of specific audit and non-audit services in the categories of audit services, audit-related services and tax services, if any, that may be performed by our independent registered public accounting firm. Unless the specific service has been previously pre-approved with respect to that year, the audit committee must approve the permitted service before the independent registered public accounting firm is engaged to perform it.
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PART IV
Item 15. Exhibit and Financial Statement Schedules
(a)(1) Financial Statements
As part of this Annual Report, the consolidated financial statements are listed in the accompanying index to financial statements on page F-1.
(a)(2) Financial Statement Schedules.
All financial statement schedules have been omitted because they are not applicable, not required or the information required is shown in the financial statements or the notes thereto.
(a)(3) Exhibits.
The following is a list of exhibits filed as part of this Annual Report.
INCORPORATED BY REFERENCE
EXHIBIT NUMBER
DESCRIPTION
FORM
EXHIBIT NUMBER
FILING DATE
FILED/
FURNISHED HEREWITH
2.1
Agreement and Plan of Merger and Reorganization, dated as of March 24, 2021, by and among Cellect Biotechnology Ltd., CellMSC, Inc. and Quoin Pharmaceuticals, Inc.
6-K
10.1
March 24, 2021
2.1.1
Amendment, dated September 24, 2021, to the Agreement and Plan of Merger and Reorganization, dated as of March 24, 2021, by and among Cellect Biotechnology Ltd., CellMSC, Inc., and Quoin Pharmaceuticals, Inc.
6-K
99.2
September 27, 2021
2.2
Amended and Restated Share Transfer Agreement, dated May 27, 2021 by and between Cellect Biotechnology Ltd. and EnCellX Inc.
F-4
2.2
June 16, 2021
2.2.1
Amendment, dated September 26, 2021, to the Amended and Restated Share Transfer Agreement, dated as of May 27, 2021, by and between EnCellX, Inc. and Cellect Biotechnology Ltd.
6-K
99.3
September 27, 2021
2.3
Securities Purchase Agreement, dated as of March 24, 2021, by and among Cellect Biotechnology Ltd., Quoin Pharmaceuticals, Inc. and the investors named on the Schedule of Buyers attached thereto
6-K
10.4
March 24, 2021
2.3.1
Amendment Agreement, dated as of September 17, 2021, by and among Quoin Pharmaceuticals, Inc., Cellect Biotechnology, Ltd., and Altium Growth Fund, L.P.
6-K
99.1
September 17, 2021
2.3.2
Second Amendment Agreement, dated as of March 13, 2022, by and among Quoin Pharmaceuticals, Inc., Quoin Pharmaceuticals Ltd., and Altium Growth Fund, L.P.
6-K
4.1
March 28, 2022
2.3.3
Waiver Agreement, dated June 6, 2022, by and among Quoin Pharmaceuticals Ltd., Quoin Pharmaceuticals, Inc. and Altium Growth Fund, LP
6-K
10.2
June 6, 2022
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2.3.4
Agreement, dated July 14, 2022, by and among Quoin Pharmaceuticals, Inc., Quoin Pharmaceuticals Ltd. and Altium Growth Fund, LP
6-K
10.1
July 15, 2022
2.4
Securities Purchase Agreement, dated as of March 24, 2021, by and among Quoin Pharmaceuticals, Inc. and the investors listed on the Schedule of Buyers attached thereto
6-K
10.6
March 24, 2021
2.5
Letter Agreement, dated September 17, 2021, between Quoin Pharmaceuticals, Inc. and Cellect Biotechnology, Ltd.
6-K
99.2
September 17, 2021
3.1
Amended and Restated Articles of Association of Quoin Pharmaceuticals Ltd., as amended
10-K
3.1
March 13, 2025
3.1.1
Amendments to Amended and Restated Articles of Association of Quoin Pharmaceuticals Ltd., adopted on August 21, 2025
8-K
3.1
August 21, 2025
4.1
Form of Deposit Agreement between Cellect Biotechnology Ltd. (n/k/a Quoin Pharmaceuticals Ltd.), The Bank of New York Mellon as Depositary, and owners and holders from time to time of ADSs issued thereunder
F-1/A
4.1
July 26, 2016
4.1.1
Specimen American Depositary Receipt (included in Exhibit 4.1).
4.2
Form of Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the August 2022 Offering
F-1
4.13
August 3, 2022
4.2.1
Form of Amendment No. 1 to Warrant to Purchase Ordinary Shares Represented by American Depositary Shares, dated as of February 24, 2023
8-K
4.3
February 28, 2023
4.3
Form of Warrant to Purchase Ordinary Shares Represented by American Depositary Shares, issued in the February 2023 Offering
8-K
4.2
February 28, 2023
4.4
Form of Pre-Funded Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the March 2024 Offering
8-K
4.1
March 8, 2024
4.5
Form of Series D Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the March 2024 Offering
8-K
4.2
March 8, 2024
4.6
Form of Series E Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the March 2024 Offering
8-K
4.3
March 8, 2024
4.7
Form of Amendment to Warrants to Purchase Ordinary Shares Represented by American Depositary Shares issued in the March 2024 Offering
8-K
4.4
March 8, 2024
4.8
Form of Pre-Funded Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the December 2024 Offering
8-K
4.1
December 26, 2024
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4.9
Form of Series F Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the December 2024 Offering
8-K
4.2
December 26, 2024
4.10
Form of Series G Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the December 2024 Offering
8-K
4.3
December 26, 2024
4.11
Form of Amendment to Warrants to Purchase Ordinary Shares Represented by American Depositary Shares, dated as of December 20, 2024
8-K
4.4
December 26, 2024
4.12
Form of Pre-Funded Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the October 2025 Private Placement
8-K
4.1
October 15, 2025
4.13
Form of Series H Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the October 2025 Private Placement
8-K
4.2
October 15, 2025
4.14
Form of Series I Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the October 2025 Private Placement
8-K
4.3
October 15, 2025
4.15
Form of Series J Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the October 2025 Private Placement
8-K
4.4
October 15, 2025
4.16
Form of Series K Warrant to Purchase Ordinary Shares Represented by American Depositary Shares issued in the October 2025 Private Placement
8-K
4.5
October 15, 2025
4.17
Description of Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934
X
10.1†
Amended and Restated Equity Incentive Plan of Quoin Pharmaceuticals Ltd., effective as of April 12, 2022
6-K
Annex C included in Exhibit 99.1
March 8, 2022
10.1.1†
Form of Non-Qualified Stock Option Award Agreement for directors
F-1
10.34
August 3, 2022
10.1.2†
Form of Non-Qualified Stock Option Award Agreement for officers
F-1
10.35
August 3, 2022
10.2†
2025 Equity Incentive Plan of Quoin Pharmaceuticals, Ltd.
S-8
4.4
August 27, 2025
10.2.1†
Form of Incentive Stock Option Grant Notification Letter
8-K
10.1
November 17, 2025
10.2.2†
Form of Non-Qualified Stock Option Grant Notification Letter
8-K
10.2
November 17, 2025
10.3†
Compensation Policy for Executives and Directors of Quoin Pharmaceuticals Ltd, adopted on August 21, 2025
X
10.4†
CEO Compensation Program
10-K
10.45
March 13, 2025
10.5†
COO Compensation Program
10-K
10.46
March 13, 2025
10.6†
Non-Employee Directors’ Compensation Program, as amended
10-K
10.44
March 13, 2025
91
Table of Contents
10.7†
Executive Employment Agreement, dated March 9, 2018, by and between Quoin Pharmaceuticals, Inc. and Dr. Michael Myers
6-K
10.1
October 29, 2021
10.8†
Executive Employment Agreement, dated March 9, 2018, by and between Quoin Pharmaceuticals, Inc. and Denise Carter
6-K
10.2
October 29, 2021
10.9†
Service Agreement, dated November 1, 2021, by and between Quoin Pharmaceuticals, Inc. and Gordon Dunn
6-K
10.1
November 23, 2021
10.9.1†
Settlement Agreement, effective August 15, 2025, by and between Quoin Pharmaceuticals, Inc., and Gordon Dunn
8-K
10.1
August 27, 2025
10.10†
Service Agreement, dated August 18. 2025, by and between Quoin Therapeutics (Ireland) Ltd. and Sally Lawlor
8-K
10.1
August 21, 2025
10.11†
Form of Indemnification and Release Agreement, entered into by and between Quoin Pharmaceuticals Ltd. and each of the officers and directors of Quoin Pharmaceuticals Ltd.
6-K
Annex D included in Exhibit 99.1
March 8, 2022
10.12
Purchase Agreement, dated January 25, 2024, by and between Quoin Pharmaceuticals Ltd. and Alumni Capital LP
8-K
10.1
January 30, 2024
10.13
Form of Placement Agency Agreement by and between Quoin Pharmaceuticals Ltd. and A.G.P/Alliance Global Partners related to the August 2022 Offering
F-1/A
1.1
August 4, 2022
10.14
Form of Securities Purchase Agreement related to the August 2022 Offering
F-1/A
4.11
August 4, 2022
10.15
Form of Placement Agency Agreement by and between Quoin Pharmaceuticals Ltd. and A.G.P/Alliance Global Partners related to the February 2023 Offering
8-K
10.2
February 28, 2023
10.16
Form of Securities Purchase Agreement related to the February 2023 Offering
8-K
10.1
February 28, 2023
10.17
Form of Placement Agency Agreement by and between Quoin Pharmaceuticals Ltd. and A.G.P/Alliance Global Partners related to the March 2024 Offering
8-K
1.1
March 8, 2024
10.18
Form of Securities Purchase Agreement related to the March 2024 Offering
8-K
10.1
March 8, 2024
10.19
Placement Agency Agreement dated December 20, 2024, by and between Quoin Pharmaceuticals Ltd. and Maxim Group LLC related to the December 2024 Offering
8-K
1.1
December 26, 2024
10.20
Form of Securities Purchase Agreement, dated December 20, 2024 related to the December 2024 Offering
8-K
10.1
December 26, 2024
92
Table of Contents
10.21
Form of Securities Purchase Agreement, dated October 10, 2025 related to the October 2025 Private Placement
8-K
10.1
October 15, 2025
10.22
Form of Registration Rights Agreement, dated October 10, 2025 related to the October 2025 Private Placement
8-K
10.2
October 15, 2025
10.23
License and Distribution Agreement, dated November 5, 2021, by and between Quoin Pharmaceuticals, Inc. and AFT Pharmaceuticals Ltd.
6-K
10.3
November 23, 2021
10.24
Supply Agreement, dated September 15, 2021, by and between Quoin Pharmaceuticals, Inc. and AFT Pharmaceuticals Ltd.
6-K
10.4
November 23, 2021
10.25
License and Distribution Agreement, dated November 7, 2021, by and between Quoin Pharmaceuticals, Inc. and GenPharm Services FZ LLC
6-K
10.5
November 23, 2021
10.26
Supply Agreement, dated November 7, 2021, by and between Quoin Pharmaceuticals, Inc. and GenPharm Services FZ LLC
6-K
10.6
November 23, 2021
10.27*
Distribution Agreement, dated December 15, 2021, by and between Quoin Pharmaceuticals, Inc. and Orpharm LLC
6-K
10.1
December 20, 2021
10.28*
License and Distribution Agreement, dated as of January 24, 2022, between the Company and E-Log Logistica LTDA
6-K
10.1
January 31, 2022
10.29*
License and Distribution Agreement, dated as of February 1, 2022, by and between Quoin Pharmaceuticals Ltd. and Er-Kim İlaç Sanayi ve Ticaret A.Ş, and the First Amendment to the License and Distribution Agreement, dated as of February 17, 2022, by and between Quoin Pharmaceuticals, Inc. and Er-Kim İlaç Sanayi ve Ticaret A.Ş
6-K
10.4
March 8, 2022
10.30*
License and Distribution Agreement, dated as of February 11, 2022, by and between Quoin Pharmaceuticals Ltd. and Neopharm (Israel) 1996 Ltd.
6-K
10.5
March 8, 2022
10.31
Supply Agreement, dated as of February 11, 2022, by and between Quoin Pharmaceuticals Ltd. and Neopharm (Israel) 1996 Ltd.
6-K
10.6
March 8, 2022
10.32
Master Services Agreement, dated November 2, 2020, by and between Therapeutics, Inc. and Quoin Pharmaceuticals, Inc.
20-F
4.39
April 13, 2022
10.33
Development and Supply Agreement, dated January 13, 2021, by and between TopChem Pharmaceuticals Limited and Quoin Pharmaceuticals Limited
20-F
4.38
April 13, 2022
10.34
Quotation – Tech Transfer and Clinical Manufacture for QRX003 Topical Lotion, dated April 8, 2021, by Ferndale Contract Manufacturing to Quoin Pharmaceuticals, Inc.
20-F
4.37
April 13, 2022
93
Table of Contents
10.35
Exclusive License Agreement, dated October 17, 2019, by and between Quoin Pharmaceuticals, Inc. and Skinvisible Inc.
20-F
4.30
April 13, 2022
10.36
Exclusive License Agreement Renewal, dated May 8, 2020, by and between Quoin Pharmaceuticals, Inc. and Skinvisible Inc.
20-F
4.31
April 13, 2022
10.37.1
First Amendment to the Exclusive License Agreement, dated July 31, 2020, by and between Quoin Pharmaceuticals, Inc. and Skinvisible Inc.
20-F
4.32
April 13, 2022
10.37.2
Second Amendment to the Exclusive License Agreement, dated September 30, 2020, by and between Quoin Pharmaceuticals, Inc. and Skinvisible Inc.
20-F
4.33
April 13, 2022
10.37.3
Third Amendment to the Exclusive License Agreement, dated January 27, 2021, by and between Quoin Pharmaceuticals, Inc. and Skinvisible Inc.
20-F
4.34
April 13, 2022
10.37.4
Fourth Amendment to the Exclusive License Agreement, dated April 19, 2021, by and between Quoin Pharmaceuticals, Inc. and Skinvisible Inc.
20-F
4.35
April 13, 2022
10.37.5
Fifth Amendment to the Exclusive License Agreement, dated June 14, 2021, by and between Quoin Pharmaceuticals, Inc. and Skinvisible Inc.
20-F
4.36
April 13, 2022
10.38*
License and Distribution Agreement, dated June 14, 2022, by and between Quoin Pharmaceuticals, Inc. and WinHealth Investment (HK) Limited
6-K
10.1
June 17, 2022
10.39*
License and Distribution Agreement, dated July 14, 2022, by and between Quoin Pharmaceuticals, Inc. and Endo Ventures Limited
6-K
10.2
July 15, 2022
10.40*
Supply Agreement, dated July 14, 2022, by and between Quoin Pharmaceuticals, Inc. and Endo Ventures Limited
6-K
10.3
July 15, 2022
10.41
License and Distribution Agreement, dated September 1, 2023, by and between Quoin Pharmaceuticals Inc. and Farma Mondo
8-K
10.1
September 13, 2023
10.42
Research Agreement, dated November 1, 2021, by and between Quoin Pharmaceuticals, Inc. and Queensland University of Technology
6-K
10.2
November 23, 2021
10.43*
Research Agreement, dated May 20, 2022, by and between Quoin Pharmaceuticals, Inc. and Queensland University of Technology, Australia
6-K
10.1
June 6, 2022
14.1
Code of Ethics
10-K
14.1
March 15, 2023
19.1
Quoin Pharmaceuticals Ltd. Insider Trading Policy
10-K
19.1
March 13, 2025
21.1
Subsidiaries of Registrant
X
23.1
Consent of CBIZ CPAs P.C., Certified Public Accountants
X
23.2
Consent of Marcum LLP
X
94
Table of Contents
31.1
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934.
X
31.2
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934.
X
32.1#
Certification of Chief Executive Officer pursuant to 18 U.S.C. § 1350.
X
32.2#
Certification of Chief Financial Officer pursuant to 18 U.S.C. § 1350.
X
97.1
Clawback Policy
10-K
97.1
March 14, 2024
101
Information formatted Inline XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations and Other Comprehensive Loss, (iii) Consolidated Statements of Shareholders’ Equity, (iv) Consolidated Statements of Cash Flows, and (v) Notes to Consolidated Financial Statements.
X
104
Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit 101)
X
# Indicates management contract or compensatory plan or arrangement.
Item 16. Form 10-K Summary
None.
95
Table of Contents
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: March 26, 2026
QUOIN PHARMACEUTICALS LTD.
By:
/s/ Dr. Michael Myers
Name:
Dr. Michael Myers
Title:
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant in the capacities and on the dates indicated.
Signature
Title
Date
/s/ Dr. Michael Myers
Chairman and Chief Executive Officer
Dr. Michael Myers
(Principal Executive Officer)
March 26, 2026
/s/ Sally Lawlor
Chief Financial Officer
Sally Lawlor
(Principal Financial Officer and Principal Accounting Officer)
March 26, 2026
/s/ Denise Carter
Denise Carter
Director and Chief Operating Officer
March 26, 2026
/s/ Joseph Cooper
Joseph Cooper
Director
March 26, 2026
/s/ James Culverwell
James Culverwell
Director
March 26, 2026
/s/ Dennis Langer
Dennis Langer
Director
March 26, 2026
/s/ Natalie Leong
Natalie Leong
Director
March 26, 2026
/s/ Michael Sember
Michael Sember
Director
March 26, 2026
96
Table of Contents
QUOIN PHARMACEUTICALS LTD.
Contents
Page
Report of Independent Registered Public Accounting Firm CBIZ CPAs P.C. (PCAOB Auditor Firm ID: # 199 )
F-2
Report of Independent Registered Public Accounting Firm – Marcum LLP (PCAOB Firm ID: # 688 )
F-3
Consolidated Financial Statements
Consolidated Balance Sheets as of December 31, 2025 and December 31, 2024
F-4
Consolidated Statements of Operations a nd Other Comprehensive Loss for the years ended December 31, 2025 and 2024
F-5
Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2025 and 2024
F-6
Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024
F-7
Notes to consolidated financial statements
F-8 – F-24
F-1
Table of Contents
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors of
Quoin Pharmaceuticals Ltd.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheet of Quoin Pharmaceuticals Ltd. (the “Company”) as of December 31, 2025, the related consolidated statements of operations and other comprehensive loss, shareholders’ equity and cash flows for the year ended December 31, 2025, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025, and the results of its operations and its cash flows for the year ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.
Explanatory Paragraph – Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As more fully described in Note 2, the Company has a significant working capital deficiency, has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions 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 financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. 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 audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the 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 its internal control over financial reporting. As part of our audit 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 audit included performing procedures to assess the risks of material misstatement of the 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 financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
Critical Audit Matters
Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.
/s/ CBIZ CPAS P.C.
CBIZ CPAs P.C.
We have served as the Company’s auditor since 2020 (such date takes into account the acquisition of certain assets of Marcum LLP by CBIZ CPAs P.C. effective November 1, 2024).
Morristown, New Jersey
March 26, 2026
F-2
Table of Contents
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors of
Quoin Pharmaceuticals Ltd.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheet of Quoin Pharmaceuticals Ltd. (the “Company”) as of December 31, 2024, the related consolidated statements of operations, shareholders’ equity and cash flows for the year ended December 31, 2024, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024, and the results of its operations and its cash flows for the year ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. 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 audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the 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 its internal control over financial reporting. As part of our audit 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 audit included performing procedures to assess the risks of material misstatement of the 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 financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our provides a reasonable basis for our opinion.
/s/ MARCUM LLP
Marcum LLP
We have served as the Company’s auditor from 2020 to 2025.
Morristown, New Jersey
March 13, 2025
F-3
Table of Contents
QUOIN PHARMACEUTICALS LTD.
Consolidated Balance Sheets
December 31,
December 31,
2025
2024
ASSETS
Current assets:
Cash and cash equivalents
$
3,818,096
$
3,623,343
Investments
14,927,165
10,433,535
Prepaid expenses and other current assets
1,261,974
869,126
Total current assets
20,007,235
14,926,004
Prepaid expenses - long term
—
300,000
Intangible assets, net
383,334
483,334
Total assets
$
20,390,569
$
15,709,338
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
1,262,222
$
905,704
Accrued expenses
2,538,457
1,528,977
Accrued interest and financing expense
1,146,251
1,146,251
Due to officers - short term
600,000
600,000
Total current liabilities
5,546,930
4,180,932
Due to officers - long term
1,723,733
2,323,733
Total liabilities
$
7,270,663
$
6,504,665
Commitments and contingencies
Shareholders’ equity:
Ordinary shares, no par value per share, 5,000,000,000 and 100,000,000 ordinary shares authorized at December 31, 2025 and December 31, 2024, respectively - 52,441,360 ( 1,498,325 ADS’s) ordinary shares issued and outstanding at December 31, 2025 and 8,948,164 ( 255,661 ADS’s) ordinary shares issued and outstanding at December 31, 2024
$
—
$
—
Accumulated other comprehensive loss
( 613 )
—
Additional paid in capital
84,090,966
64,370,465
Accumulated deficit
( 70,970,447 )
( 55,165,792 )
Total shareholders’ equity
13,119,906
9,204,673
Total liabilities and shareholders’ equity
$
20,390,569
$
15,709,338
The accompanying footnotes are an integral part of these consolidated financial statements
F-4
Table of Contents
QUOIN PHARMACEUTICALS LTD.
Consolidated Statements of Operations and Other Comprehensive Loss
Years Ended December 31,
2025
2024
Operating expenses
General and administrative
$
6,487,909
$
5,925,833
Research and development
9,802,807
3,602,632
Total operating expenses
16,290,716
9,528,465
Other (income) and expenses
Unrealized gain
( 3,980 )
( 7,502 )
Realized and accrued interest income
( 482,081 )
( 558,491 )
Total other income
( 486,061 )
( 565,993 )
Net loss
$
( 15,804,655 )
$
( 8,962,472 )
Other comprehensive loss
Foreign currency translation
( 613 )
—
Total other comprehensive loss
( 613 )
—
Comprehensive loss
$
( 15,805,268 )
$
( 8,962,472 )
Loss per ADS
Loss per ADS
Basic
$
( 14.80 )
$
( 68.02 )
Fully-diluted
$
( 14.80 )
$
( 68.02 )
Weighted average number of ADS’s outstanding
Basic
1,068,152
131,759
Fully-diluted
1,068,152
131,759
The accompanying footnotes are an integral part of these consolidated financial statements
F-5
Table of Contents
QUOIN PHARMACEUTICALS LTD.
Consolidated Statements of Shareholders’ Equity
Years Ended December 31, 2025 and 2024
Accumulated
Additional
other
Ordinary
Paid in
Accumulated
comprehensive
Shares
ADS’s
Capital
Deficit
loss
Total
Balance at December 31, 2023
987,220
28,206
$
51,867,336
$
( 46,203,320 )
$
—
$
5,664,016
Net loss
—
—
—
( 8,962,472 )
—
( 8,962,472 )
Stock based compensation
—
—
1,258,890
—
—
1,258,890
Issuance of ADS and Pre-Funded Warrants
7,960,944
227,455
11,244,239
—
—
11,244,239
Balance at December 31, 2024
8,948,164
255,661
$
64,370,465
$
( 55,165,792 )
$
—
$
9,204,673
Net loss
—
—
—
( 15,804,655 )
( 15,804,655 )
Stock based compensation
—
—
1,147,236
1,147,236
Issuance of ADS and Pre-Funded Warrants, net
530,320
15,152
15,082,443
15,082,443
Exercise of Warrants, net
7,798,024
222,801
3,490,822
3,490,822
Exercise of Pre-Funded Warrants
35,164,852
1,004,711
—
Foreign currency adjustment
( 613 )
( 613 )
Balance at December 31, 2025
52,441,360
1,498,325
$
84,090,966
$
( 70,970,447 )
$
( 613 )
$
13,119,906
The accompanying footnotes are an integral part of these consolidated financial statements
F-6
Table of Contents
QUOIN PHARMACEUTICALS LTD.
Consolidated Statements of Cash Flows
Years Ended December 31,
2025
2024
Cash flows used in operating activities:
Net loss
$
( 15,804,655 )
$
( 8,962,472 )
Stock based compensation
1,147,236
1,258,890
Amortization of intangibles
100,000
100,000
Realized and unrealized gain and accrued interest on investments
( 215,855 )
( 251,590 )
Changes in assets and liabilities:
Increase (decrease) in accounts payable and accrued expenses
1,325,128
275,955
Decrease in prepaid expenses and other assets
( 92,848 )
( 278,092 )
Net cash used in operating activities
$
( 13,540,994 )
$
( 7,857,309 )
Cash flows provided by investing activities:
Purchase of investments
$
( 12,264,069 )
$
( 17,254,282 )
Proceeds from redemption of investments
7,986,294
15,366,000
Net cash used by investing activities
$
( 4,277,775 )
$
( 1,888,282 )
Cash flows (used in) provided by financing activities:
Payment of amounts due to officers
$
( 600,000 )
$
( 600,000 )
Proceeds from sale of equity securities, net
18,614,135
11,567,736
Net cash provided by financing activities
$
18,014,135
$
10,967,736
Effect of foreign exchange rate on changes on cash
( 613 )
—
Net change in cash and cash equivalents:
194,753
1,222,145
Cash and cash equivalents - beginning of year
3,623,343
2,401,198
Cash and cash equivalents - end of year
$
3,818,096
$
3,623,343
Supplemental information - Non cash items:
Offering expenses associated with warrant modification
$
—
$
1,725,148
Accrued offering expenses included in additional paid in capital
$
40,870
$
323,497
The accompanying footnotes are an integral part of these consolidated financial statements
F-7
Table of Contents
QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
NOTE 1 – ORGANIZATION AND BUSINESS
Quoin Pharmaceuticals Ltd. (“Quoin Ltd.,” or the “Company”), formerly known as Cellect Biotechnology Ltd. (“Cellect”), is the holding company for Quoin Pharmaceuticals, Inc., a Delaware corporation (“Quoin Inc.”). Quoin Inc. was incorporated in Delaware on March 5, 2018. Quoin Inc. is the holding company for Quoin Therapeutics Ireland Limited (“Quoin Ireland”), an Irish private company limited by shares. Quoin Ireland was incorporated in Ireland on November 26, 2024. On October 28, 2021, Cellect completed the business combination with Quoin Inc., with Quoin Inc. surviving as a wholly-owned subsidiary of Cellect (the “Merger”). Immediately after completion of the Merger, Cellect changed its name to “Quoin Pharmaceuticals Ltd.”
Effective April 9, 2025, the ratio of American Depositary Shares (“ADSs”) evidencing ordinary shares changed from 1 ADS representing one (1) ordinary share to 1 ADS representing thirty-five ( 35 ) ordinary shares (the “Ratio Change”), which resulted in a 1 for 35 reverse split of the issued and outstanding ADSs (the “Reverse Split”). Our Ordinary Shares were not affected by this adjustment. Except as specifically provided, ADSs and related option, warrant, purchase price and exercise price information presented in these consolidated financial statements and accompanying footnotes has been retroactively adjusted to reflect the Ratio Change and the Reverse Split.
The Company is a late-stage clinical specialty pharmaceutical company focused on the development and commercialization of therapeutic products that treat rare and orphan diseases for which there are currently either no approved or very limited treatments or cures. The Company’s lead product, QRX003, is under clinical development as a potential treatment for Netherton Syndrome (“NS”), a rare hereditary genetic disease. QRX003 is entering pivotal registrational clinical testing under an open Investigational New Drug (“IND”) application with the Food and Drug Administration (“FDA”). The Company has opened six clinical sites in the United States (“US”) along with international sites that are being opened in the UK, Spain, France and the Netherlands. QRX003 is currently being tested in seven pediatric NS patients in investigator-initiated studies in Ireland, Austria, the Netherlands and New Zealand. QRX003 is also being developed as a potential treatment for Peeling Skin Syndrome with the first subject being treated in New Zealand. The company is in the process of expanding this study to include up to an additional five pediatric subjects. The Company has entered into a Research Agreement with the Queensland University of Technology (“QUT”) in Australia, under which the Company has obtained an option for a global license to QRX008 for the potential treatment of scleroderma, as well as a Research Agreement with The School of Pharmacy at University College Cork (“UCC”) for the development of novel topical formulations of rapamycin (sirolimus) as potential treatments for a number of rare and orphan diseases for which there are either limited or no approved therapies or cures, including microcystic lymphatic malformations, venous malformations and angiofibromas among others. Quoin has also entered into 9 commercial partnerships for QRX003 spanning 61 countries outside of its core commercial territories of the US, Western Europe and Japan. These partnership countries include Canada, Australia/New Zealand, the Middle East, China, Taiwan, Hong Kong, Singapore, Israel, Central and Eastern Europe, Turkey as well as several countries in Latin America. To date, no products have been commercialized and no revenue has been generated by the Company.
NOTE 2 - LIQUIDITY RISKS AND OTHER UNCERTAINTIES
The consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) assuming the Company will continue as a going concern. The Company has incurred net losses every year since inception and has an accumulated deficit of approximately $ 71.0 million at December 31, 2025. The Company has a limited operating history and has historically funded its operations through its founders’ funding expenditures and debt and equity financings. At December 31, 2025, the Company had cash balances totaling $ 3.8 million and investments of $ 14.9 million.
The Company’s ability to continue as a going concern is dependent upon the Company’s ability to obtain additional funding. There can be no assurance that such funding will be available in sufficient amounts or on terms acceptable to the Company. The accompanying consolidated financial statements do not include any adjustments relating to the recoverability of the recorded assets or the classification of liabilities that may be necessary should the Company be unable to continue as a going concern.
Based upon the Company’s current business plans and cash, cash equivalents and investments on hand, management has concluded that there is substantial doubt about our ability to continue as a going concern for a period of at least one year from the issuance of the audited consolidated financial statements. In order to address the Company’s capital needs, the Company intends to consider multiple alternatives, including, but not limited to, the sale of additional equity or debt securities or other debt instruments, collaborative, strategic,
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
and/or licensing transactions or grants to support our future operations. We do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates, which we expect will take a number of years and is subject to significant uncertainty The Company will need to obtain further funding through public or private offerings of its capital stock, debt financing, pursuant to the exercise of warrants issued to investors in the Company’s prior public and private offerings, collaboration, strategic and/or licensing arrangements or other sources in order to complete the research and development of the Company’s product candidates and to fund the Company’s other operating requirements until it achieves commercial profitability, if ever. However, the Company may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. In addition, any exercise of the Company’s outstanding warrants is at the discretion of the warrant holders and is dependent, in part, upon the market price of the Company’s ADSs. There can be no assurance that any of the Company’s outstanding warrants will ever be in-the-money prior to their expiration and, as such, the Company’s outstanding warrants may expire without being exercised. If the Company is unable to obtain additional funding when it becomes necessary, the development of its product candidates will be impacted and the Company would likely be forced to delay, reduce, or terminate some or all of its development programs.
Other risks and uncertainties:
The Company is subject to risks common to late-stage clinical specialty pharmaceutical companies including, but not limited to, new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, product liability, pre-clinical and clinical trial outcome risks, regulatory approval risks, uncertainty of market acceptance and additional financing requirements.
The Company’s products require approval or clearance from the FDA prior to commencing commercial sales in the United States. There can be no assurance that the Company’s products will receive all of the required approvals or clearances. Approvals or clearances are also required in foreign jurisdictions in which the Company may license or sell its products.
There can be no assurance that the Company’s products, if approved, will be accepted in the marketplace, nor can there be any assurance that any future products can be developed or manufactured at an acceptable cost and with appropriate performance characteristics, or that such products will be successfully marketed.
The Company is also dependent on several third party suppliers, in some cases a single source supplier including the contract research organization managing both of the Company’s current clinical studies, the supplier of the active pharmaceutical ingredient (API), as well as the contract manufacturer of the drug product for clinical development.
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation:
The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP, which have been consistently applied. All intercompany accounts and transactions have been eliminated in consolidation.
Principles of Consolidation:
The accompanying consolidated financial statements include the accounts of Quoin Pharmaceuticals Ltd. and its wholly owned subsidiary. All intercompany transactions and balances are eliminated in consolidation. The functional currency of Quoin Ireland, a wholly-owned subsidiary of the Company, is remeasured into U.S. dollars using the exchange rate in effect at the consolidated balance sheet date. The Company translates the assets and liabilities of its Ireland subsidiary into the United States dollar at the exchange rate in effect on the balance sheet date and those unrealized gains and losses are reported in other comprehensive income. Expenses are remeasured using the average exchange rate in effect during the period. Gains and losses arising from remeasurement of the wholly owned subsidiary’s financial statements are included in the determination of net loss.
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
Use of Estimates:
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could materially differ from those estimates. Management considers many factors in developing the estimates and assumptions that are used in the preparation of these financial statements including: expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates, and whether historical trends are expected to be representative of future trends. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes and management must select an amount that falls within that range of reasonable estimates. Estimates are used in the following areas, among others: settlement of debt or other obligations, stock-based compensation, research and development expense recognition, intangible asset estimated useful lives and impairment assessments, allowances of deferred tax assets, and cash flow assumptions regarding going concern considerations.
Cash and cash equivalents:
The Company considers all highly liquid investments and short-term debt instruments with original maturities of three months or less to be cash equivalents. The Company, from time to time during the periods presented, has had bank account balances in excess of federally insured limits where substantially all cash is held in the United States. The Company has not experienced losses in such accounts. The Company believes that it is not subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships.
Warrants:
The Company classifies as equity any contracts that (i) require physical settlement or net-share settlement or (ii) provide the Company with a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement) provided that such contracts are indexed to the Company’s own stock. The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the Company’s control) or (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement).
The Company assesses classification of its warrants and other free-standing derivatives at each reporting date to determine whether a change in classification between assets, liabilities and equity is required. The Company evaluated the warrants to assess their proper classification using the applicable criteria enumerated under U.S. GAAP and determined that such warrants meet the criteria for equity classification in the accompanying consolidated balance sheets as of December 31, 2025 and December 31, 2024, respectively.
Investments:
Investments as of December 31, 2025 and 2024 consist primarily of U.S. Treasury Bills and Notes, which are classified as trading securities, totaling $ 14.9 million and $ 10.4 million, respectively. The amount as of December 31, 2025 also includes $ 0.2 million held as cash equivalents. The Company determines the appropriate balance sheet classification of its investments at the time of purchase and evaluates the classification at each balance sheet date. All of the Company’s U.S. Treasury Bills and Notes held on December 31, 2025 have maturities within twelve months from the balance sheet date. As of December 31, 2025, the carrying value of the Company’s U.S. Treasury Bills and Notes approximates their fair value due to their short-term maturities.
Long-lived assets:
Long-lived assets are comprised of acquired technology and licensed rights to use technology, which are considered platform technology with alternative future uses beyond the current products in development. Such intangible assets are being amortized on a straight-line basis over their expected useful life of 10 years .
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
The Company assesses the impairment for long-lived assets whenever events or circumstances indicate the carrying value may not be recoverable. Factors the Company considers that could trigger an impairment review include the following:
● Significant changes in the manner of the Company’s use of the acquired assets or the strategy for its overall business,
● Significant underperformance relative to expected historical or projected development milestones,
● Significant negative regulatory or economic trends, and
● Significant technological changes which could render the platform technology obsolete.
The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value. During the years ended December 31, 2025 and 2024, there were no impairment indicators which required an impairment loss measurement.
Operating Segment:
The Company operates in one business segment, which includes the business of research and development activities related to the development of therapeutic products that treat rare and orphan diseases for which there are currently very limited or no approved treatments or cures. The determination of a single business segment is consistent with the consolidated financial information regularly provided to the Company’s chief operating decision maker (“CODM”). The Company’s CODM is its Chief Executive Officer, who reviews and evaluates consolidated net loss for purposes of assessing performance, making operating decisions, allocating resources, and planning and forecasting for future periods.
In addition to the significant expense categories included within consolidated net loss presented on the Company’s Consolidated Statements of Operations, see below for disaggregated amounts that comprise research and development expenses:
Year ended December 31,
2025
2024
External clinical development expenses
$
7,396,788
$
2,083,119
Personnel related and stock-based compensation
1,532,280
1,073,564
Other research and development expenses
873,739
445,949
Total research and development expenses
$
9,802,807
$
3,602,632
Research and development:
Research and development costs are expensed as incurred. Research and development expenses include personnel costs associated with research and development activities, including third-party contractors to perform research, conduct clinical trials and manufacture drug supplies and materials. The Company accrues for costs incurred by external service providers, including contract research organizations and clinical investigators, based on its estimates of service performed and costs incurred. These estimates include the level of services performed by third parties, patient enrollment in clinical trials when applicable, administrative costs incurred by third parties, and other indicators of the services completed. Based on the timing of amounts invoiced by service providers, the Company may also record payments made to those providers as prepaid expenses that will be recognized as expenses in future periods as the related services are rendered.
Income taxes:
The Company accounts for its income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company maintains a full valuation allowance on its existing deferred tax assets.
The Company also accounts for uncertain tax positions using the more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken in the Company’s income tax returns. As of December 31, 2025 and 2024, the Company had no uncertain tax positions which affected its financial position and its results of operations or its cash flows and will continue to evaluate for uncertain tax positions in the future. If at any time the Company should record interest and penalties in connection with income taxes, the interest and the penalties will be expensed within the interest and general and administrative expenses, respectively.
Stock based compensation:
The Company recognizes compensation costs resulting from the issuance of stock-based awards to employees, non-employees and directors as an expense in the consolidated statements of operations over the requisite service period based on a measurement of fair value for each stock-based award. The fair value of each option grant is estimated as of the date of grant using the Black-Scholes option-pricing model. The Company accounts for forfeitures as they occur. The fair value is amortized as compensation cost on a straight-line basis over the requisite service period of the awards, which is generally the vesting period.
Since the Company has a limited history of trading as a public company, the Company’s expected stock volatility is based on a weighting of its historical volatility along with a group of a publicly traded set of peer companies. The Company utilizes the simplified method to estimate the expected term. The risk-free interest rate was determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The expected dividend yield was assumed to be zero as the Company has not paid dividends since its inception and does not anticipate paying dividends in the foreseeable future.
Fair value of financial instruments:
The Company considers its cash and cash equivalents, investments, accounts payable, accrued expenses to meet the definition of financial instruments. The carrying amounts of these financial instruments approximated their fair values due to the short maturities.
The Company measures fair value as required by ASC Topic 820, Fair Value Measurements and Disclosures (“ASC Topic 820”). ASC Topic 820 defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. ASC Topic 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.
Earnings (loss) per share:
The Company reports loss per share in accordance with ASC 260-10, Earnings Per Share , which provides for calculation of “basic” and “diluted” earnings per share. Basic earnings per share includes no dilution and is computed by dividing net income or loss available to shareholders by the weighted average shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity. The calculation of diluted net earnings (loss) per share gives effect to ordinary shares equivalents; however, other than unexercised prefunded warrants as described below, potential shares are excluded if their effect is anti-dilutive.
For the year ended December 31, 2025, the number of shares excluded from the diluted net earnings (loss) per share included outstanding warrants to purchase 8,931,650 ADS and outstanding stock options to purchase 215,957 ADS. For the year ended December 31, 2024, the number of shares excluded from the diluted net earnings (loss) per share included outstanding warrants to purchase 1,120,301 ADS and outstanding stock options to purchase 55,541 ADS. The inclusion of these warrants and stock options for both 2025 and 2024 in the denominator would be anti-dilutive. For the years ended December 31, 2025 and December 31, 2024 basic and diluted net earnings (loss) per share included 1,309,591 ADS and 320,362 ADS respectively issuable with respect to unexercised prefunded warrants (See Note 13).
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
Recent Accounting Pronouncements:
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures . The standard is intended to enhance the transparency and decision usefulness of income tax disclosures primarily through changes to the rate reconciliation and income taxes paid information. The Company adopted ASU No. 2023-09 prospectively effective January 1, 2025 (See Note14).
In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses , requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements . The amendments in this update provide clarifications intended to improve the consistency and usability of interim disclosure requirements and the applicability to Topic 270. The amendments also provide additional guidance for reporting material events occurring after the most recent annual period. The new guidance will be applied prospectively and is effective for fiscal years beginning after December 15, 2027, and interim periods within those annual reporting periods, with the option to apply retrospectively. Early adoption is permitted. The adoption of this guidance is not expected to have a significant impact on the Company’s consolidated financial statements.
NOTE 4 – ACCRUED INTEREST AND FINANCING EXPENSE
On October 2, 2020, Quoin Inc. issued promissory notes (the “2020 Notes”) to certain investors (“2020 Noteholders”). The 2020 Notes were mandatorily convertible into 12 ADSs, subject to adjustment and were converted in 2021. The ADSs issued to the 2020 Noteholders did not include accrued interest. Two of the five 2020 Noteholders received their amount due during the year ended December 31, 2022 and the Company’s estimate of the liability to the remaining three 2020 Noteholders was estimated to be $ 1,146,000 as of December 31, 2025 and December 31, 2024.
There was no interest expense recognized in both the years ended December 31, 2025 and 2024.
NOTE 5 - FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company applies fair value accounting for all assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities the Company considers the principal or most advantageous market in which it would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. For certain instruments, including cash and cash equivalents, accounts payable, and accrued expenses, it was estimated that the carrying amount approximated fair value because of the short maturities of these instruments.
Fair value is estimated using various valuation models, which utilize certain inputs and assumptions that market participants would use in pricing the asset or liability. The inputs and assumptions used in valuation models are classified in the fair value hierarchy as follows:
Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.
Level 2: Quoted market prices for similar instruments in an active market; quoted prices for identical or similar assets and liabilities in markets that are not active; and model-derived valuations inputs of which are observable and can be corroborated by market data.
Level 3: Unobservable inputs and assumptions that are supported by little or no market activity and that are significant to the fair value of the asset and liability. The fair value hierarchy gives the lowest priority to Level 3 inputs.
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
In determining the appropriate hierarchy levels, the Company analyzes the assets and liabilities that are subject to fair value disclosure. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to their fair value measurement.
The following table presents the Company’s assets and liabilities that are measured at fair value on a recurring basis by fair value hierarchy at December 31, 2025 and 2024:
December 31, 2025
Level 1
Level 2
Level 3
Total
US Treasury Bills and Notes
$
14,927,165
$
—
$
—
$
14,927,165
Mutual Funds
224,093
224,093
Total Assets
$
15,151,258
$
—
$
—
$
15,151,258
December 31, 2024
Level 1
Level 2
Level 3
Total
US Treasury Bills and Notes
$
10,433,535
$
—
$
—
$
10,433,535
Total US Treasury Bills and Notes Asset
$
10,433,535
$
—
$
—
$
10,433,535
NOTE 6 – STOCK BASED COMPENSATION
In March 2022, the Board of Directors of the Company approved the Amended and Restated Equity Incentive Plan which was approved by the shareholders at the Company’s Annual General Meeting of Shareholders held on April 12, 2022 (the “Amended Plan”). The Amended Plan increased the number of ordinary shares reserved for issuance under such equity incentive plan to 15 % of the Company’s outstanding ordinary shares on a fully-diluted basis, or 9,197,277 ordinary shares represented by 262,779 ADSs as of December 31, 2024. Under the Amended Plan, the Company could grant options to its directors, officers, employees, consultants, advisers and service providers. As of the year ended December 31, 2025 200,627 options are outstanding under the Amended Plan and following approval of the 2025 Equity Incentive Plan, no shares are available for issuance under the Amended Plan.
On August 21, 2025, at our 2025 Annual General Meeting of Shareholders, our shareholders approved the Quoin Pharmaceuticals Ltd. 2025 Equity Incentive Plan (the “2025 Plan”) and authorized the issuance pursuant to the 2025 Plan of up to 3,000,000 Ordinary Shares represented by 85,714 ADSs, subject to an automatic annual increase equal to the smaller of (a) fifteen percent ( 15 %) of the number of Ordinary Shares issued and outstanding on a fully diluted basis on the immediately preceding December 31, or (b) an amount determined by our Board of Directors. The 2025 Plan supersedes the Amended Plan. As of the year ended December 31, 2025, 2,463,450 shares represented by 70,384 ADSs are available for issuance under the 2025 Plan.
The following table summarizes stock-based activities under the Amended & 2025 Plans:
Weighted
Weighted
Average
Average
ADS Underlying
Exercise
Contractual
Options
Price
Terms
Outstanding at December 31, 2023
7,946
$
886.90
9.68
Granted
47,595
27.30
Outstanding at December 31, 2024
55,541
$
150.27
9.76
Granted
171,313
9.99
Canceled
( 10,897 )
74.19
Outstanding at December 31, 2025
215,957
$
42.83
9.30
Exercisable options at December 31, 2025
10,774
$
485.14
8.29
The intrinsic value of outstanding options at December 31, 2025 was $ 0.8 million.
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
Stock options granted during the years ended December 31, 2025 and 2024 were valued using the Black-Scholes option-pricing model with the following weighted average assumptions:
December 31,
December 31,
2025
2024
Expected volatility
108.8
%
106.6
%
Risk-free interest rate
4.4
%
3.9
%
Expected dividend yield
0.0
%
0.0
%
Expected life of options in years
6.4
6.4
Exercise Price
$
9.99
$
27.30
Fair value of stock
$
9.66
$
27.30
Estimate fair value of option
$
8.22
$
23.10
Stock based compensation expense was approximately $ 1.15 million ( $ 400,000 included in research and development expense and $ 750,000 included in general and administrative expenses) in the year ended December 31, 2025. Stock based compensation expense was approximately $ 1.26 million ( $ 293,000 included in research and development expense and $ 967,000 included in general and administrative expenses) in the year ended December 31, 2024. At December 31, 2025, the total unrecognized compensation expense related to non-vested options was approximately $ 2.5 million and is expected to be recognized over the remaining weighted average service period of approximately 3.35 years.
NOTE 7 – PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid expenses and other current assets are as follows:
December 31,
December 31,
2025
2024
Prepaid R&D costs
$
920,947
$
772,083
Prepaid insurance
277,808
309,889
Prepaid expense
63,219
87,154
Total
$
1,261,974
$
1,169,126
Less: Short-term portion
( 1,261,974 )
( 869,126 )
Long-term portion
$
—
$
300,000
NOTE 8 – ACCRUED EXPENSES
Accrued expenses are as follows:
December 31,
December 31,
2025
2024
Research contract expenses (note 12)
$
934,524
$
183,094
Payroll (note 11)
1,023,295
940,539
Payroll taxes (note 11)
54,936
77,726
Accrued severance
391,926
—
Professional fees
96,848
323,497
Other expenses
36,928
4,121
Total
$
2,538,457
$
1,528,977
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
NOTE 9 –IN-LICENSED TECHNOLOGY
Skinvisible:
In October 2019, Quoin Inc. entered into the Exclusive Licensing Agreement (as amended from time to time, the “License Agreement”) with Skinvisible Pharmaceuticals, Inc. (“Skinvisible”), under which Skinvisible granted the Company an exclusive royalty-bearing license relating to the production and manufacture of prescription drug products related to certain patents held by Skinvisible, including those related to QRX003 and QRX004. The Company made Skinvisible a one-time non-refundable, non-creditable license fee of $ 1 million (the “License Fee”). In addition, the Company agreed to pay Skinvisible a single digit royalty percentage of the Company’s net sales revenues for any licensed product covered by the patent rights licensed under the License Agreement. The Company also agreed to pay Skinvisible 25 % of any revenues the Company receives as royalties in the event that the Company sublicense any licensed products to a third party. The License Agreement also requires that the Company make a $ 5 million payment to Skinvisible upon receiving approval in the U.S. or European Union, whichever occurs first, for the first drug product developed using intellectual property licensed thereunder. There were no milestone or royalty obligations due at December 31, 2025 and December 31, 2024.
NOTE 10 - INTANGIBLE ASSETS
Intangible assets are as follows:
December 31,
December 31,
2025
2024
Technology license – Skinvisible
$
1,000,000
$
1,000,000
Accumulated amortization
( 616,666 )
( 516,666 )
Net book value
$
383,334
$
483,334
The Company recorded amortization expense of approximately $ 100,000 and $ 100,000 in the years ended December 31, 2025 and 2024, respectively. The annual amortization expense expected to be recorded for existing intangible assets for the years 2026 through 2029, is approximately $ 100,000 , $ 100,000 , $ 100,000 and $ 83,000 , respectively.
NOTE 11 – RELATED PARTY TRANSACTIONS
Due to Officers/Founders:
Due to the limited funding of Quoin Inc. prior to the consummation of the Merger, the compensation, including salary, office and car allowances and other benefits, due to Dr. Myers and Ms. Carter under their respective employment agreements, as well as reimbursement of expenses and other amounts paid by Dr. Myers and Ms. Carter to third parties on behalf of Quoin Inc., were not paid by Quoin Inc. to Dr. Myers and Ms. Carter, and were accrued as indebtedness to Dr. Myers and Ms. Carter. Following the closing of the Merger, Quoin Inc. began making payments of $ 25,000 per month to each of Dr. Myers and Ms. Carter to repay the above-described non-interest-bearing indebtedness. The Company repaid $ 300,000 and $ 300,000 of such indebtedness to Dr. Myers and $ 300,000 and $ 300,000 to Ms. Carter in the year ending December 31, 2025 and 2024, respectively. As of December 31, 2025, approximately $ 1,359,000 and $ 965,000 of such indebtedness was outstanding to Dr. Myers and Ms. Carter , respectively.
Amounts due to officers at December 31, 2025 and 2024 consisted of the following:
December 31,
December 31,
2025
2024
Salaries and other compensation
$
2,323,733
$
2,923,733
Less: Short-term portion
( 600,000 )
( 600,000 )
Long-term portion
$
1,723,733
$
2,323,733
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
Insider Participation in October 2025 and December 2024 Offering:
See Note 13.
Interest Payable:
See Note 4 for interest payable on the 2020 Notes.
NOTE 12 – RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS
Research and consulting agreement
In November 2020, Quoin Inc. entered into a Master Service Agreement with Therapeutics Inc. for the management of the pre - clinical and clinical development of QRX003 for Netherton Syndrome. The initial term of the agreement was three years with automatic one year extensions, and the agreement required the execution of individual work orders. Quoin Inc. may terminate any work order for any reason with 90 days written notice subject to costs incurred through termination and a defined termination fee, unless there is a material breach by Therapeutics Inc. A work order was entered into in June 2022 for the first QRX003 clinical study at an expected estimated cost of approximately $ 4.4 million. An additional change order was entered into in December 2022 for a second QRX003 clinical study at an expected estimated cost of approximately $ 830,000 . An amended and restated change order for the two studies was entered into in December 2024 at an estimated total remaining cost from August 2024 of approximately $ 3.6 million for the two studies combined. In the years ended December 31, 2025 and 2024, the Company incurred a research and development expense under these agreements of approximately $ 2.1 million and $ 1.1 million respectively. During the year ended December 31, 2024, the Company received a credit of approximately $ 83,000 applied to prior expenses incurred during the period of January 2024 to March 2024.
In November 2021, the Company entered into a research agreement with Queensland University of Technology (“QUT”) for a pre-clinical research program for the development of a product to treat Netherton Syndrome of approximately $ 250,000 . In May 2022, the Company entered into a second research agreement with QUT for the development of a product to treat Scleroderma of approximately $ 610,000 . Each agreement remains in place until the completion of the research program, which in each case was initially anticipated to be 18 months from execution. For the years December 31, 2025 and 2024, the Company incurred de-minimis research and development costs related to these agreements. In July 2025 the Company announced that, in light of the expected near-term completion of the QRX003 clinical program for Netherton Syndrome, the Company has discontinued Netherton Syndrome research program with QUT. The Company is planning to schedule a meeting with QUT to discuss the future direction of the Scleroderma research program.
On June 10, 2024, the Company signed a research agreement with The School of Pharmacy at University College Cork, Ireland (“UCC”). The scope of the agreement encompasses the development of novel topical formulations of rapamycin (sirolimus) as potential treatments for a number of rare and orphan diseases for which there are currently no approved therapies or cures. Under the terms of the agreement, based on the achievement of certain milestones, the Company will fund up to approximately € 567,000 ( $ 664,000 ) plus VAT over an anticipated 2-1/2 year period to support the UCC research program to investigate the development of a number of topical rapamycin formulations for future development as potential treatments for several rare and orphan diseases. Following completion of the research program, the Company will have the option to advance the clinical development of rapamycin formulations developed by UCC. Work on this research project commenced in December 2024. For the year ended December 31, 2025 and December 31, 2024, the Company incurred a research and development expense under these agreements of approximately $ 0.3 million and de-minimis, respectively.
Performance milestones and Royalties
See Note 9 for asset and in-licensed technology commitments.
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
NOTE 13 – SHAREHOLDERS’ EQUITY
As of December 31, 2025, the authorized share capital of the Company was 5,000,000,000 ordinary shares, no par value, with each ADS representing thirty-five ordinary shares.
Each holder of an ordinary share is entitled to one vote per share held on all matters submitted to a vote of shareholders at each shareholders meeting. The board of directors shall determine and provide a record date for each shareholders meeting and all shareholders on such record date may vote. Unless stipulated differently in the Companies Law or in the articles of association, all shareholders’ resolutions shall be approved by a simple majority vote.
Under Israeli law, the Company may declare and pay dividends only if, upon the determination of its board of directors, there is no reasonable concern that the distribution will prevent the Company from being able to meet the terms of its existing and foreseeable obligations as they become due. Under the Companies Law, the distribution amount is further limited to the greater of retained earnings or earnings generated over the two most recent years legally available for distribution according to the Company’s then last reviewed or audited financial statements, provided that the date of the financial statements is not more than six months prior to the date of distribution. In the event that the Company does not have retained earnings or earnings generated over the two most recent years legally available for distribution, the Company may seek the approval of the court in order to distribute a dividend. The court may approve the Company’s request if it determines that there is no reasonable concern that the payment of a dividend will prevent the Company from satisfying existing and foreseeable obligations as they become due.
Alumni Equity Line and Purchase Agreement
On January 25, 2024, the Company entered into a purchase agreement (the “Alumni Purchase Agreement”) with Alumni Capital LP (“Alumni”). Pursuant to the Alumni Purchase Agreement, the Company has the right to sell to Alumni up to $ 8,000,000 (the “Commitment Amount”) of newly issued ordinary shares that are represented by ADS, subject to certain conditions and limitations, from time to time during the term of the Alumni Purchase Agreement.
The Company does not have the right to commence any sales of ordinary shares represented by ADSs to Alumni under the Alumni Purchase Agreement until the date, which the Company refers to as the Commencement Date, that all of the conditions set forth in the Alumni Purchase Agreement have been satisfied, including that the registration statement the Company agreed to file with the SEC pursuant to the Alumni Purchase Agreement is declared effective by the SEC, and the Company’s shareholders have approved of the issuance of ADSs under the Alumni Purchase Agreement, which approval was obtained on April 5, 2024.
From and after the Commencement Date, the Company may, from time to time and at the Company’s sole discretion for a period of three months, which the Company at its sole discretion may increase by an additional three months (such period, including any extension, the “Commitment Period”), on any business day that the Company may select, direct Alumni to purchase ordinary shares represented by ADSs. The purchase price for the ordinary shares represented by ADSs the Company may sell to Alumni will be based upon formulas set forth in the Alumni Purchase Agreement based on the then current market price of the ADSs as computed under the Alumni Purchase Agreement and will depend on the type of purchase notice the Company submits to Alumni from time to time. There is no upper limit on the price per share that Alumni could be obligated to pay for the ADSs under the Alumni Purchase Agreement; provided, however at no time can the purchase price be below a floor price of $ 1.00 per share (subject to adjustment). The Company agreed to issue purchase notices for an aggregate of at least $ 4,000,000 of the Commitment Amount prior to the end of the Commitment Period.
As consideration for Alumni’s irrevocable commitment to purchase ADSs under the Alumni Purchase Agreement, the Company agreed to issue to Alumni, at the times set forth in the Alumni Purchase Agreement beginning with the trading day after the Commencement Date, a number of ADSs with a value at the time of issuance not to exceed $ 240,000 in the aggregate (the “Commitment Securities”). The Company may pay cash in lieu of issuing all or any portion of the Commitment Securities.
In connection with each of the March 2024 Offering and the December 2024 Offering, the Company agreed not to sell any ADSs to Alumni under the Alumni Purchase Agreement for a period of 180 days from the closing date of such Offering, see below. Per mutual agreement between the parties, the Company has not filed the required registration statement or sold any ADS to Alumni under the
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
Alumni Purchase Agreement. The Company is restricted from selling ADSs under the Alumni Purchase Agreement for 180 days from the closing of the December 2024 Offering (see below).
The Company expensed approximately $ 112,000 in deferred offering costs incurred during the year ended December 31, 2024 of which approximately $ 34,000 was recorded in year ended December 31, 2023.
2024 Public Offerings
On March 7, 2024, (the “March 2024 Closing Date”) the Company completed an offering (the “March 2024 Offering”) of the following securities (i) 811,250 ordinary shares represented by 23,178 ADSs, (ii) Series D warrants (the “Series D Warrants”) to purchase 4,062,500 ordinary shares represented by 116,071 ADSs, (iii) Series E warrants (the “Series E Warrants”) to purchase 4,062,500 ordinary shares represented by 116,071 ADSs, and (iv) Pre-funded warrants (the “March 2024 Pre-Funded Warrants”) to purchase 3,251,250 ordinary shares represented by 92,893 ADSs for aggregate gross proceeds of approximately $ 6.5 million, resulting in net proceeds of approximately $ 5.5 million, after deducting the placement agent’s fees and offering expenses paid by us. Each ADS (or March 2024 Pre-Funded Warrant to purchase one ADS in lieu thereof) was sold together with a Series D Warrant to purchase one ADS and a Series E Warrant to purchase one ADS. The ADSs and accompanying Series D Warrants and Series E Warrants were sold at a combined public offering price of $ 56 and the March 2024 Pre-Funded Warrants and accompanying Series D Warrants and Series E Warrants were sold at a combined public offering price of $ 55.9965 , which is equal to the combined purchase price per ADS and accompanying Series D Warrants and Series E Warrants, minus the exercise price of each March 2024 Pre-Funded Warrant of $ 0.0035 . The Series D Warrants and Series E Warrants have an exercise price of $ 56 per share, were exercisable immediately following the closing of the March 2024 Offering and expire in two years and five years , respectively, from the closing of the March 2024 Offering.
On March 7, 2024, the Company also entered into privately negotiated agreements with the holders of certain existing outstanding warrants to purchase up to 18,252 ADSs to, among other things, reduce the exercise price of such warrants to $ 56 and to extend the expiration date of such warrants until March 7, 2029. The incremental fair value of the modified warrants was approximately $ 209,000 , which was accounted for as an offering expense in connection with the March 2024 Offering.
On December 23, 2024, the Company completed an offering (the “December 2024 Offering” and, together with the March 2024 Offering, the “2024 Offerings”) of the following securities (i) 3,137,778 ordinary shares represented by 89,651 ADSs, (ii) Series F warrants (the “Series F Warrants”) to purchase 15,111,110 ordinary shares represented by 431,746 ADSs, (iii) Series G warrants (the “Series G Warrants” and together with the Series F Warrants, the “December 2024 Warrants”) to purchase 15,111,110 ordinary shares represented by 431,746 ADSs, and (iv) Pre-funded warrants (the “December 2024 Pre-Funded Warrants”) to purchase 11,973,332 ordinary shares represented by 342,095 ADSs for aggregate gross proceeds of approximately $ 6.8 million, resulting in net proceeds of approximately $ 5.8 million, after deducting the placement agent’s fees and offering expenses paid by the Company. Each ADS (or December 2024 Pre-Funded Warrant to purchase one ADS in lieu thereof) was sold together with a Series F Warrant to purchase one ADS and a Series G Warrant to purchase one ADS. The ADSs and accompanying December 2024 Warrants were sold at a combined public offering price of $ 15.75 and the December 2024 Pre-Funded Warrants and accompanying December 2024 Warrants were sold at a combined public offering price of $ 15.7465 , which is equal to the combined purchase price per ADS and accompanying December 2024 Warrants, minus the exercise price of each December 2024 Pre-Funded Warrant of $ 0.0035 . As of December 31, 2025, 342,095 December 2024 Pre-Funded Warrants, have been exercised and are included in issued and outstanding ADSs. The December 2024 Pre-Funded Warrants were immediately exercisable upon issuance and may be exercised at any time until exercised in full. The Series F Warrants and the Series G Warrants have an exercise price of $ 15.75 per share, were exercisable immediately upon issuance and expire in two years and five years , respectively, from the closing of the December 2024 Offering.
In connection with the 2024 Offerings, the Company entered into Securities Purchase Agreements (the “2024 Purchase Agreements”) dated March 7, 2024 and December 23, 2024, respectively, with certain institutional investors signatory thereto, pursuant to which the Company agreed to issue and sell to such investors, certain of the ADSs, pre-funded warrants and ordinary warrants sold in the 2024 Offerings. Pursuant to the terms of each of the 2024 Purchase Agreements, the Company agreed, subject to certain exceptions, (i) to not enter into variable rate financings for a period of 180 days following the closing of such 2024 Offering, and (ii) to not enter into any equity financings for 90 days from closing of such 2024 Offering.
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
Certain of the Company’s officers and directors purchased an aggregate of 38,095 ADSs and accompanying December 2024 Warrants to purchase 76,190 ADSs, for a total purchase price of approximately $ 600,000 , at the public offering price and on the same terms as the other purchasers in the December 2024 Offering.
On December 20, 2024, the Company also entered into privately negotiated agreements with the holders of certain existing outstanding warrants to purchase up to 200,071 ADSs to, among other things, reduce the exercise price of such warrants to $ 15.75 and to extend the expiration date of such warrants until December 23, 2029. The incremental fair value of the modified warrants was approximately $ 1.5 million, which was accounted for as an offering expense in connection with the December 2024 Offering.
October 2025 Private Placement
On October 10, 2025, the Company entered into the a securities purchase agreement (the “October 2025 Purchase Agreement”) with several institutional and accredited investors (the “October Purchasers”) relating to the issuance and sale in a private placement transaction (the “October 2025 Private Placement”) of (i) 530,320 ordinary shares represented by 15,152 ADSs and (ii) pre-funded warrants to purchase 69,787,865 ordinary shares represented by 1,993,939 ADSs (the “October 2025 Pre-Funded Warrants”), together with (A) Series H Warrants to purchase 70,318,185 ordinary shares represented by up to 2,009,091 ADSs (“Series H Warrants”), (B) Series I Warrants to purchase 70,318,185 ordinary shares represented by up to 2,009,091 ADSs (“Series I Warrants”), (C) Series J Warrants to purchase 70,318,185 ordinary shares represented by up to 2,009,091 ADSs (“Series J Warrants”), and (D) Series K Warrants to purchase 70,318,185 ordinary shares represented by up to 2,009,091 ADSs (“Series K Warrants” and, together with the Series H Warrants, Series I Warrants, and Series J Warrants, the “October 2025 Ordinary Warrants”). The October 2025 Private Placement closed on October 14, 2025 (the “October 2025 Closing Date”).
Beneficial ownership limitation . A holder of the October 2025 Pre-Funded Warrants or October 2025 Ordinary Warrants may not exercise any portion of such October 2025 Pre-Funded Warrants or October 2025 Ordinary Warrants for ADSs to the extent that the holder, together with its affiliates, would beneficially own more than 4.99 % of the number of ordinary shares outstanding immediately after giving effect to the issuance of the ordinary shares represented by the ADSs issuable upon exercise of the applicable warrant.
October 2025 Pre-Funded Warrants . The October 2025 Pre-Funded Warrants have an exercise price of $ 0.0001 per ADS. The October 2025 Pre-Funded Warrants are exercisable at any time after their original issuance, subject to the beneficial ownership limitation (as described above) and will not expire until exercised in full. In addition, the October 2025 Pre-Funded Warrants may be exercised, in whole or in part, any time after issuance by means of a cashless exercise.
October 2025 Ordinary Warrants . The October 2025 Ordinary Warrants are exercisable at any time after their original issuance, subject to the beneficial ownership limitation (as described above). The Series H Warrants have an exercise price of $ 9.075 per ADS and, pursuant to the terms of the Series H Warrants, such warrants may be exercised until the earlier of (i) five (5) years from the October 2025 Closing Date or (ii) 30 days after the public announcement that we have received Type C meeting minutes from the FDA indicating openness to baseline-controlled pivotal studies for QRX003 for the treatment of Netherton Syndrome. Upon receipt of Type C meeting minutes from the FDA, the Company, in March 2026, determined that the Series H Warrants will remain exercisable until five (5) years from the October 2025 Closing Date.The Series I Warrants have an exercise price of $ 10.3125 per ADS and, pursuant to the terms of the Series I Warrants, may be exercised as follows: (i) 50 % of the Series I Warrants may be exercised until the earlier of (A) five (5) years from the October 2025 Closing Date or (B) 30 days after the public announcement that the primary endpoint has been met in the monotherapy pivotal trial of QRX003 for the treatment of Netherton Syndrome, and (ii) 50 % of the Series I Warrants may be exercised until the earlier of (A) five (5) years from the October 2025 Closing Date or (B) 30 days after the public announcement that the primary endpoint has been met in the adjuvant pivotal trial of QRX003 for the treatment of Netherton Syndrome. The Series J Warrants have an exercise price of $ 12.375 per ADS and, pursuant to the terms of the Series J Warrants, such warrants may be exercised until the earlier of (i) five (5) years from the October 2025 Closing Date or (ii) 30 days after the public announcement of the receipt of either accelerated or traditional approval by the FDA of QRX003 for the treatment of Netherton Syndrome. The Series K Warrants have an exercise price of $ 12.375 per ADS and, pursuant to the terms of the Series K Warrants, such warrants may be exercised until the earlier of (i) five (5) years from the October 2025 Closing Date or (ii) 30 days after the public announcement of the sale of a Priority Review Voucher (PRV).
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
Dennis Langer, one of the Company’s directors, participated in the October 2025 Private Placement. Mr. Langer purchased 530,320 ordinary shares represented by 15,152 ADSs and accompanying October 2025 Ordinary Warrants for a total purchase price of approximately $ 128,641 , at a combined purchase price of $ 8.49 per ADS and accompanying October 2025 Ordinary Warrants.
The Company received upfront net proceeds of approximately $ 14.9 million from the October 2025 Private Placement, after deducting estimated offering expenses payable by us, including placement agent fees and expenses.
Maxim Group LLC served as the exclusive placement agent in connection with the October 2025 Private Placement and was paid (i) a cash fee equal to 7.0 % of the aggregate gross proceeds of the October 2025 Private Placement (excluding the securities purchased by Mr. Langer, for which no cash fee was received), and (ii) up to $ 75,000 for legal fees and other out-of-pocket expenses.
During 2025, the Company also received approximately $ 3.5 million from the exercise of warrants.
Warrants
The following table summarizes warrant activities during the year ended December 31, 2024 and the year ended December 31, 2025:
Weighted
ADSs Underlying
Average Exercise
Warrants
Price Per ADS
Outstanding and exercisable at December 31, 2023
24,688
$
564.52
*
Granted Warrants
1,095,635
17.39
*
Granted Pre-Funded Warrants
434,988
—
Exercised Pre-Funded Warrants
( 114,626 )
—
Terminated
( 21 )
$
57,750.00
Outstanding and exercisable at December 31, 2024
1,440,664
$
16.80
Granted Warrants
8,036,364
11.03
Granted Pre-Funded Warrants
1,993,939
—
Exercised Warrants
( 222,801 )
15.75
Exercised Pre-Funded Warrants
( 1,004,711 )
—
Terminated
( 2,215 )
$
433.54
Outstanding and exercisable at December 31, 2025
10,241,240
$
10.59
* Note that the exercise price of certain ordinary warrants issued in the Company’s 2022 Offering and 2023 Offering were reduced from $ 462.00 to $ 56.00 per ADS for investors who participated in the March 2024 Offering, and the exercise price of certain ordinary warrants issued in the 2022 Offering, 2023 Offering and March 2024 Offering were reduced from $ 56.00 to $ 15.75 per ADS for certain investors who participated in the December 2024 Offering, see above.
As of December 31, 2025, outstanding ordinary warrants expire in 2026, 2027, 2028 and 2029 and have an intrinsic value of approximately $ 27.3 million, and outstanding pre-funded warrants have an intrinsic value of approximately $ 18.9 million.
NOTE 14 – INCOME TAXES
The Company’s U.S. and foreign loss before income taxes are set forth below:
2025
2024
United States
$
( 15,722,913 )
$
( 8,962,472 )
Foreign
( 81,742 )
—
Income before income taxes
$
( 15,804,655 )
$
( 8,962,472 )
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
Income tax expense differed from the amounts computed by applying the U.S. Federal statutory income tax rate to income (loss) before income taxes, as presented in conformity with ASU 2023-09 as follows:
Year Ended December 31, 2025
Book earnings (loss) before taxes
$
( 15,804,655 )
U.S. Federal Statutory Tax Rate
( 3,318,978 )
21.0
%
State & Local Income Taxes, Net of Federal Income Tax Effect
489,322
( 3.1 )
%
Foreign Tax Effects
—
0.0
%
Change in Foreign Valuation Allowance
10,218
( 0.1 )
%
Foreign Rate Differential
6,948
0.0
%
Effect of Cross-Border Tax Laws
—
0.0
%
Tax Credits
—
0.0
%
Research and development tax credits
( 80,482 )
0.5
%
Changes in Valuation Allowances
2,567,925
( 16.3 )
%
Nontaxable or Nondeductible Items
—
0.0
%
IRC 162(m)
323,581
( 2.0 )
%
Other
1,466
0.0
%
Changes in Unrecognized Tax Benefits
—
0.0
%
Other Adjustments
—
0.0
%
Effective Tax Rate
$
—
0.0
%
Significant components of the Company’s deferred tax assets and liabilities at December 31, 2025 and December 31, 2024 are as follows:
2025
2024
Intangible Assets
$
67,540
$
60,277
Accrued Expenses
119,524
230,426
Stock Based Compensation
540,155
474,039
Research & Development
2,264,454
1,667,722
Unrealized Exchange Gain/Loss
3,482
—
Net Operating Loss
8,575,552
5,683,264
Foreign Operating Loss
10,218
—
R&D Credits
433,736
353,255
Total gross deferred tax assets/(liabilities)
$
12,014,660
$
8,468,983
Less valuation allowance
( 12,014,660 )
( 8,468,983 )
Net deferred tax assets/(liabilities)
$
—
$
—
The income tax benefit for the years ended December 31, 2024 as presented in conformity with ASU 2023-09 as follows, differed from the amounts computed by applying the U.S. federal income tax rate of 21 % to loss before tax benefit as a result of nondeductible expenses, tax credits generated, utilization of net operating loss carryforwards, and increases in the Company’s valuation allowance.
2024
Federal Statutory Rate
$
( 1,893,000 )
Permanent Differences
208,000
Research and Development
( 180,000 )
State Income Tax
( 139,000 )
State rate change
( 397,000 )
Change in Valuation Allowance
2,253,000
Deferred True Up
148,000
Effective Tax
—
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
In assessing the realizability of the net deferred tax assets, the Company considers all relevant positive and negative evidence to determine whether it is more likely than not that some portion of the deferred income tax will not be realized. The realization of the gross deferred tax assets is dependent on several factors, including the generation of sufficient taxable income prior to expiration of the net operation loss carryforwards. At December 31, 2025 and 2024 the Company has recorded a full valuation allowance against its net deferred tax assets of approximately $ 12,014,660 and $ 8,468,983 respectively. The change in the valuation allowance during the year ended 2025 was approximately $ 3,546,000 .
At December 31, 2025, the Company had federal net operation loss (NOL) carryforwards of approximately $ 34,811,000 . At December 31, 2025, the Company had federal research and development credit carryforwards of approximately $ 434,000 . The federal net operating loss carryforwards begin to expire in 2028, losses generated in 2018 or later of $ 34,811,000 will carry forward indefinitely. The federal credit carryforwards begin to expire in 2045. Sections 382 and 383 of the Internal Revenue Code of 1986 subject the future utilization of net operating losses and certain other tax attributes, such as research and experimental tax credits, to an annual limitation in the event of certain ownership changes, as defined. The Company may be subject to the net operating loss utilization provision of Section 382 of the Internal Revenue Code. The effect of an ownership change would be the imposition of an annual limitation of the use of NOL carryforwards attributable to periods before the change. The amount of the annual limitation depends upon the value of the Company immediately before the change, changes to the Company’s capital during a specified period prior to the change, and the federal published interest rate. Although the Company has not completed an analysis under Section 382 of the Code, it is likely that the utilization of the NOLs will be limited.
The Internal Revenue Code (the “IRC”) contains limitations on the use of net operating loss carryforwards after the occurrence of a substantial ownership change as defined by IRC Section 382. The Company has not performed a detailed analysis, however utilization of such net operating loss carryforwards will likely be significantly limited due to the shares issued in the Primary Financing and the Merger.
Entities are also required to evaluate, measure, recognize and disclose any uncertain income tax provisions taken on their income tax returns. The Company has analyzed its tax positions and has concluded that as of December 31, 2025 there were no uncertain positions. The Company’s U.S. federal and state net operating losses have occurred since its inception in 2009 and as such, tax years subject to potential tax examination could apply from that date. This is because the utilization of net operating losses from prior years opens the relevant year to audit by the IRS and/or state taxing authorities. Interest and penalties, if any, as they relate to income taxes assessed, are included in the income tax provision. The Company did not have any unrecognized tax benefits and has not accrued any interest or penalties for the 12 months ended December 31, 2025 and 2024.
The Tax Cuts and Jobs Act of 2017 (TCJA) has modified the IRC 174 expenses related to research and development for the tax years beginning after December 31, 2021. Under the TCJA, the Company had to capitalize the expenditures related to research and development activities and amortize over five years for U.S. activities and 15 years for non-U.S. activities using a mid-year convention. Therefore, the capitalization of research and development costs in accordance with IRC 174 resulted in a gross deferred tax asset of $ 6,717,000 as at December 31, 2024. The One Big Beautiful Bill Act of 2025 (OBBBA) further amended IRC 174 by introduction IRC 174A allowing immediate deduction of R&D expenses for U.S. activities from 2025 onwards, reversing the five-year amortization under the TCJA. The OBBBA further provided the option of amending prior years’ returns (2022-2024) to deduct previously capitalized R&D expenses. As of December 31, 2025, the Company does not intend to amend its prior year returns.
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QUOIN PHARMACEUTICALS LTD.
Notes to Consolidated Financial Statements
December 31, 2025 and 2024
NOTE 15 - CONTINGENCIES
From time to time, the Company may become involved in various legal matters arising in the ordinary course of business. Management is unaware of any matters requiring accrual for related losses in the financial statements.
NOTE 16 – LICENSE AGREEMENTS
As of both December 31, 2025 and December 31, 2024, the Company had nine commercial license and supply agreements outstanding, whereby the Company will receive a royalty or other proceeds from the specified product revenues from the licensor, if and when the underlying products are approved and commercialized or sold via compassionate use or early access programs. No revenues have been received through December 31, 2025 from any of these agreements.
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