2. Liquidity and Going Concern

In accordance with ASC 205-40, Going Concern, the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the unaudited condensed consolidated financial statements are issued. Since its inception, the Company has generated significant losses and as of June 30, 2026, the Company had an accumulated deficit of $77.0 million. As of June 30, 2026, the Company had cash and cash equivalents of $0.7 million. For the six months ended June 30, 2026, the Company had net operating losses of $6.7 million, and cash used in operating activities of $2.4 million.

Management has determined that it does not currently have sufficient cash and other sources of liquidity to fund its current business plan. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern for at least the next 12 months from the financial statement filing date.

The Company’s expectation is to generate operating losses and negative operating cash flows in the future and will need additional funding to support its current business plan in addition to the funds available from the at the market offering program (the “Sales Agreement”). The Company currently has approximately $73.6 million available funds from the Sales Agreement as of the financial statement release date when accounting for the $2.4 million due to J.J. Astor via the convertible note agreement entered into during the six months ended June 30, 2026 (the “J.J. Astor Note”). The available funds from the Sales Agreement is subject to further reduction in the event of default. However, there is no assurance that such funding will be available when needed. If additional funding is not available when required, the Company would need to delay or curtail its operations and its research and development activities until such funding is received, all of which could have a material adverse effect on the Company and its financial condition. See Note 7 and Note 18 for further discussion of the J.J. Astor Note.

These unaudited condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern and do not include adjustments to reflect the possible effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.