Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis is intended as a review of significant factors affecting our financial condition and results of operations for the periods indicated. The discussion should be read in conjunction with our unaudited condensed financial statements and the notes presented herein included in this Form 10-Q and the audited financial statements and the other information set forth in the S-1 registration statement recently filed with the SEC. ln addition to historical information, the following Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties including, but not limited to, those set forth below under "Risk Factors" and elsewhere herein. Our actual results could differ significantly from those anticipated in these forward-looking statements as a result of certain factors discussed herein and any other periodic reports filed and to be filed with the Securities and Exchange Commission.

Overview

We are a clinical-stage biopharmaceutical company focused on leveraging unique, pioneering science to address unmet needs in the treatment of infectious diseases, improving patient outcomes, and significantly reducing the threat posed by antibiotic-resistant bacterial strains, including methicillin resistant Staphylococcus aureus (MRSA), vancomycin resistant Enterococci species (VRE), and others. Antimicrobial resistance (AMR) represents a growing global health crisis, being directly responsible for 1.27 million deaths annually and contributing to nearly 5 million deaths worldwide. The rapid rise of resistant pathogens has rendered many existing antibiotics ineffective against these pathogens, increasing the risk of severe infections, prolonged hospital stays, and substantial economic burdens. Despite this urgent need, the development of new antibiotics has slowed, with most advancements occurring within existing drug classes, leaving these new compounds vulnerable to resistance mechanisms.

Our product candidates consist of antimicrobials targeting acute and chronic infectious diseases, which are delivered locally to the site of infection. As of April 2026, we hold 68 issued and 36 pending patent applications for our products and technologies, with coverage in major pharmaceutical markets. We have successfully completed our first exploratory human clinical trials for our lead product, the broad-spectrum Bisphosphocin^® (anti-bacterial) Nu-3, which is being developed for the topical treatment of mildly infected diabetic foot ulcers (iDFU). We plan to conduct an initial Phase 2a safety and dose response study, followed by a placebo-controlled Phase 2b dose comparative study to identify the optimal dose for Phase 3 trials and eventual commercialization. This study will also determine the most appropriate administration regimen for Nu-3 gel formation in mildly infected diabetic foot ulcers. Additionally, we are advancing early-stage pipeline compounds and are focused on further characterizing them to identify the best clinical indications for non-clinical and clinical evaluation. Advancement of any of our product candidates to the commercialization stage is completely dependent on the outcome of clinical studies that are reviewed and approved by the FDA or other comparable regulatory authorities.

Corporate History and Structure

Headquartered in University Park, Florida, we were originally incorporated in Delaware on July 11, 2006, under the name Nu Pharmas, Inc. ("Nu Pharmas"). We initially focused on antisense RNA research and the contract manufacturing of oligonucleotides. On April 9, 2007, Nu Pharmas acquired substantially all the assets of Renaissance Nutraceuticals, Inc., a Delaware corporation, and subsequently changed its name to Amedex Therapeutics, Inc. ("Amedex Therapeutics"). On November 11, 2007, Amedex Therapeutics acquired substantially all the assets of Lakewood Pharmaceuticals, Inc., a Delaware corporation. On February 1, 2008, Amedex Therapeutics changed its name to Lakewood-Amedex Inc. On June 5, 2025, the Company changed its name to Lakewood-Amedex Biotherapeutics Inc. and redomiciled as a Nevada corporation. On September 29, 2025, the Company filed a certificate of amendment to its articles of incorporation effecting a 1-for-5.92 reverse stock split.

From 2012 to 2013, we shifted our focus toward the development of small molecule antimicrobials, particularly the Bisphosphocin^® class of molecules, which were discovered during the early oligonucleotide testing. Since 2014, we have continued to refine our research and development efforts to address the growing global issue of AMR.

We have incurred significant operating losses and negative cash flows from operations since our inception. Our net losses were $0.9 million and $0.5 million for the three months ended March 31, 2026 and 2025, respectively. As of March 31, 2026, we had an accumulated deficit of $54.3 million. Substantially all our net losses have resulted from costs incurred in connection with our R&D programs and, to a lesser extent, from general and administrative ("G&A") costs associated with our operations. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical trials, preclinical studies, and our other R&D activities. In addition, we incur additional costs associated with operating as a public company, including significant legal, audit, accounting, regulatory and tax-related services associated with maintaining compliance with exchange listing and requirements of the Securities and Exchange Commission ("SEC"), director and officer liability insurance costs, investor and public relations costs, and other expenses.

Because of the numerous risks and uncertainties associated with the development of therapeutics, we are unable to accurately predict the timing or amount of increased expenses and when, or if, we will be able to achieve or maintain profitability. Even if we are able to generate product sales, we may not become profitable. If we fail to become profitable or are unable to sustain profitability on a continuing basis, then we may be unable to continue our operations as planned and may be forced to reduce or terminate our operations.

We do not have any products approved for sale and have not generated any revenue from product sales. We will not generate revenue from product sales unless and until we successfully complete clinical development and obtain regulatory approval for our current or any future product candidates, which we expect will take a number of years or may never occur. As a result, we will need substantial additional funding to support our continuing operations and pursue our growth strategy. Until such time as we can generate significant revenue from product sales, if ever, we expect to finance our operations through equity offerings, debt financings, or other capital sources, including current and potential future collaborations, license agreements, and other similar arrangements. However, we may be unable to raise additional funds or enter into such other agreements or arrangements when needed on favorable terms, or at all. If we fail to raise capital or enter into such agreements or arrangements as, and when needed, we may delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise develop and market ourselves, or even cease operations.

As of March 31, 2026, we had cash and cash equivalents of $11.7 thousand. In addition, on April 21, 2026, we received net proceeds of approximately $6.8 million from a private placement of Series C Convertible Preferred Stock. Based on our current operating plan, we estimate that our cash and cash equivalents will be sufficient to fund our operating expenses requirements through 2026. However, we have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we currently expect.

Results of operations

Comparison of the three months ended March 31, 2026 and 2025

The following table summarizes our results of operations for the three months ended March 31, 2026 and 2025:

		Three months ended March 31,
		2026				2025				Change
Revenue		$	-		$		-			$	-
Operating expenses:
Research and development			182,147			$	169,703				12,444
General and administrative			704,603				372,906				331,697
Total operating expenses			886,750				542,609				344,141
Loss from operations			(886,750	)			(542,609	)			(344,141	)
Other income (expense), net:
Interest income			1,078				4,307				(3,229	)
Interest expense			(38,219	)			(1,315	)			(36,904	)
Other income			600				-				600
Total other income (expense), net			(36,541	)			2,992				(39,533	)
Net loss		$	(923,291	)		$	(539,617	)		$	(383,674	)

Research and development expenses

The following table summarizes our R&D expenses for the three months ended March 31, 2026 and 2025:

		Three months ended March 31,
		2026				2025				Change
Clinical and pre-clinical expenses		$	15,733			$	23,449			$	(7,716	)
Personnel-related expenses			162,784				142,624				20,160
Other expenses			3,630				3,630				-
Total research and development expenses		$	182,147			$	169,703			$	12,444

Research and development expenses were $182 thousand for the three months ended March 31, 2026, compared to $170 thousand for the three months ended March 31, 2025. The increase of $12 thousand in research and development expenses was primarily attributable to a increase of approximately $20 thousand in workforce-related expenses, including the partial restoration of previously voluntary reduced compensation. The increase was partially offset by: (i) the promotion of our Chief Operating Officer to Chief Executive Officer, which resulted in the prospective change in allocation of 60% of such executive's salary to general and administrative expenses; (ii) a decrease of approximately $13 thousand in stock-based compensation expense; and (iii) a decrease of approximately $8 thousand in clinical and regulatory expenses related to a clinical trial.

General and administrative expenses

The following table summarizes our general and administrative expenses for the three months ended March 31, 2026 and 2025:

		Three months ended March 31,
		2026				2025				Change
Personnel-related expenses		$	146,840			$	72,127			$	74,713
Professional services			427,515				201,488				226,027
Corporate expenses			92,073				60,532				31,541
Facility costs			37,016				37,600				(584	)
Total general and administrative expenses		$	703,444			$	371,747			$	331,697

General and administrative expenses were approximately $703 thousand for the three months ended March 31, 2026 compared to approximately $372 thousand for the three months ended March 31, 2025. The increase of approximately $331 thousand was primarily attributable: (i) an increase of approximately $75 thousand in workforce-related expenses, including the partial restoration of voluntary reduced compensation, the promotion of our Chief Operating Officer to Chief Executive Officer resulting in the prospective change in allocation of such executive's salary to general and administrative expenses, and increased stock-based compensation expense; (ii) an increase of approximately $219 thousand in professional fees; and (iii) an increase of approximately $37 thousand in investor relations and public relations expenses. The increases in professional fees and investor relations-related expenses were primarily incurred in connection with the Company's preparation for a proposed direct listing on Nasdaq.

Other income (expense), net

Other income (expense), net was approximately $(37) thousand for the three months ended March 31, 2026 compared to approximately $3 thousand for the three months ended March 31, 2025. The decrease of approximately $40 thousand was primarily attributable to: an increase in interest expense of approximately $37 thousand related to the issuance of convertible notes and short-term notes to provide additional working capital and support the Company's proposed direct listing on Nasdaq; and (ii) a decrease in interest income of approximately $3 thousand.

Liquidity and Capital Resources

Sources of Liquidity

As of March 31, 2026, we had cash and cash equivalents of $11.7 thousand. In addition, on April 21, 2026, we received net proceeds of approximately $6.8 million from a private placement of Series C Convertible Preferred Stock. Based on our current operating plan, we estimate that our cash and cash equivalents will be sufficient to fund our operating expenses requirements through 2026. However, we have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we currently expect.

Material Cash Requirements from Known Contractual and Other Obligations

Leases

We lease office space in University Park, Florida, under a non-cancelable operating lease that expires on April 30, 2027. For additional information, refer to Note 4 to our condensed financial statements included elsewhere in this filing.

Research and Development Commitments

We expect to continue to incur substantial costs related to the ongoing clinical development of Nu-3 and other pipeline candidates. We have entered into new contractual commitments with CROs to support clinical trial execution. Each contract typically remains in effect through the completion of the respective clinical trial.

Cash flows

For the three months ended March 31, 2026 and 2025

The following table summarizes our cash flows for the three months ended March 31, 2026 and 2025:

		For the Three Months Ended December 31,
		2026				2025
Net cash used in operating activities		$	(349,691	)		$	(404,089	)
Net cash provided by financing activities			125,000				200,000
Net decrease in cash and cash equivalents		$	(224,691	)		$	(204,089	)

Operating Activities

Net cash used in operating activities was approximately $0.3 million for the three months ended March 31, 2026, compared to approximately $0.4 million for the three months ended March 31, 2025, representing a decrease in cash used of approximately $0.1 million. The decrease was primarily attributable to higher non-cash adjustments and more favorable changes in working capital during the current period, partially offset by an increase in net loss.

For the three months ended March 31, 2026, cash used in operating activities was primarily driven by a net loss of approximately $0.9 million, partially offset by approximately $0.6 million of non-cash charges and favorable changes in operating assets and liabilities. Non-cash adjustments primarily consisted of stock-based compensation expense and amortization of right-of-use assets. Changes in working capital were primarily driven by increases in trade payables and accrued liabilities, partially offset by reductions in lease liabilities.

For the three months ended March 31, 2025, net cash used in operating activities of approximately $0.4 million was primarily driven by a net loss of approximately $0.5 million, partially offset by approximately $0.1 million of non-cash charges and favorable changes in operating assets and liabilities. Non-cash adjustments primarily consisted of stock-based compensation expense and amortization of right-of-use assets. Changes in working capital were primarily driven by increases in trade payables and accrued liabilities, partially offset by reductions in lease liabilities.

Financing Activities

Net cash provided by financing activities was approximately $0.1 million for the three months ended March 31, 2026. The proceeds were received from short-term promissory notes bearing interest at 12% per annum. The notes, including principal and accrued interest, were repaid in full in April 2026.

Net cash provided by financing activities was approximately $0.2 million for the three months ended March 31, 2025. The proceeds were received from a financing initially structured as short-term promissory notes bearing interest at 10% per annum. The notes were subsequently converted into short-term convertible promissory notes under the same interest terms. The convertible notes, including principal and accrued interest, were converted into the Company's common stock in April 2026.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our financial results are affected by the selection and application of accounting policies and methods. In the three-month period ended March 31, 2026, there were no changes to the application of critical accounting policies previously disclosed in our Registration Statement on Form S-1 (file no. 333-292664).