Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

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

The following discussion and analysis should be read together with our unaudited condensed consolidated financial statements and related notes thereto set forth in this Quarterly Report on Form 10-Q as well as our Annual Report on Form 10-K for the year ended December 31, 2024.

This Quarterly Report on Form 10-Q contains "forward-looking statements" that are management's present expectations of future events. Actual results could differ materially and adversely from those anticipated in such forward-looking statements as a result of certain factors, including but not limited to those set forth below and elsewhere in this report, many of which are beyond our control. Important factors that may cause actual results to differ from forward-looking statements include:

●	Continued negative operating cash flows;
●	Our capital needs to accomplish our goals, including any further financing, which may be highly dilutive and may include onerous terms;
●	The success of our digital asset treasury strategy;
●	The volatile and unpredictable changes in the price of ATH;
●	The expected growth of the ATH network;
●	The availability of opportunities to stake ATH;
●	The impact of competition;
●	Acquisition and maintenance of any necessary regulatory clearances applicable to applications of our technology;
●	Inability to attract or retain qualified senior management personnel, including sales and marketing personnel;
●	Risk that we never become profitable if our products and services are not accepted by potential customers;
●	Possible impact of government regulation and scrutiny;
●	Unexpected costs and operating deficits, and lower than expected sales and revenues, if any;
●	Adverse results of any legal proceedings;
●	The volatility of our operating results and financial condition,
●	Management of growth;
●	Risk that our business and operations could be materially and adversely affected by disruptions caused by economic and geopolitical uncertainties as well as epidemics or pandemics; and
●	Other specific risks that may be alluded to in this report.

All statements, other than statements of historical facts, included in this report regarding our growth strategy, future operations, financial position, estimated revenue or losses, projected costs, prospects and plans, and objectives of management are forward-looking statements. When used in this report, the words "will," "may," "believe," "anticipate," "intend," "estimate," "expect," "project," "plan," and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. All forward-looking statements speak only as of the date of this report. We do not undertake any obligation to update any forward-looking statements or other information contained herein. Potential investors should not place undue reliance on these forward-looking statements. Although we believe that our plans, intentions, and expectations reflected in or suggested by the forward-looking statements in this report are reasonable, we cannot assure potential investors that these plans, intentions or expectations will be achieved. We disclose important factors that could cause actual results to differ materially from expectations in the "Risk Factors" section and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2024, and in Item 1A of Part II below. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.

Overview

We are a knowledge and science-driven company that applies artificial intelligence ("AI") to support the discovery and development of optimal cancer therapies, which can ultimately lead to more effective treatments and improved patient outcomes. We use AI and a proprietary biobank of 150,000+ tumor samples, categorized by tumor type, to provide actionable insights about drug compounds to improve the drug discovery process and increase the probability of drug compound success. We also create and develop tumor-specific 3D cell culture models mimicking the physiological environment of human tissue, enabling better-informed decision-making during drug development. Our suite of solutions supports oncology drug development from early discovery to clinical trials.

We also recently adopted a digital asset treasury (the "Treasury Strategy") focused on the Aethir token ("ATH"), the native utility token of the Aethir network, to create a Strategic Compute Reserve. Through our holdings of ATH, we function as an operator on the Aethir network, strengthening Aethir's ability to provide the global infrastructure layer for the future of AI, democratizing access to AI infrastructure.

Aethir Treasury Strategy

On September 29, 2025, we announced the launch of the Treasury Strategy, which is focused on ATH, the native token of the Aethir network. Aethir is a leading decentralized physical infrastructure network developed by DCI Foundation, a Panama foundation company ("DCI"), that provides a decentralized graphics processing unit ("GPU") network, which connects producers and consumers of GPU compute power at enterprise scale, supporting applications such as artificial intelligence computation, gaming and cloud workloads. ATH is a utility token used for GPU rentals, staking, validation and the provision of network rewards on the Aethir network. ATH functions as a proxy for a unit of GPU compute power and serves as a medium of exchange and unit of incentives for participants in the Aethir network. Participants in the Aethir network can generate yield or other rewards by staking or lending ATH or by otherwise serving as a source of ATH liquidity. On November 10, 2025, we held approximately 5.70 billion ATH, with a market value of approximately $152.8 million, based on a price of $0.0268 per ATH, the price reported on the Coinbase exchange as of 4:00 p.m. Eastern Time on such date, of which 3.7 billion ATH are locked and subject to vesting and/or transfer restrictions and 2.0 billion ATH are unlocked.

Pursuant to the Treasury Strategy, we intend to continue acquiring additional ATH in the open market and to earn yield on our ATH treasury holdings by engaging in ATH staking and other activities. As a holder of ATH, we accrue unrealized gains or losses from any appreciation or depreciation, as applicable, in the value of ATH tokens, which trade on various cryptocurrency exchanges.

The Treasury Strategy is overseen by the Cryptocurrency Subcommittee of our board of directors, as well as our Chief Investment Officer, who reports to such committee. In addition, our Treasury Strategy is managed by DNA Holdings Venture, Inc. ("DNA") pursuant to the Asset Management Agreement (as defined below) and the Strategic Advisor Agreement (as defined below). DNA is permitted to stake and/or lend ATH in the Treasury Strategy.

In addition to operating our AI drug discovery and development business, our management is focusing its resources on the Treasury Strategy and a significant portion of our balance sheet is allocated to holding ATH pursuant to the Treasury Strategy.

Currently the Treasury Strategy is primarily dedicated to ATH, and we do not intend to allocate treasury assets to other digital assets in the near term. As a result, our assets are highly concentrated in a single digital asset. Adverse developments specific to ATH, its protocol, or its network could have a disproportionate impact on our financial condition and results of operations.

Our Treasury Strategy is intended to bring value to our stockholders through the following:

●

utilizing proceeds from equity and debt financing to purchase and hold ATH;

●

staking the majority of the ATH in our treasury to earn a staking yield and turn the treasury into a productive asset;

●

purchasing locked ATH at a discount to the current spot price; and

●

selling our ATH holdings, whether on the open market, through block trades, or other negotiated transactions, for various reasons and at various times, including, in order to fund our working capital and general corporate needs.

There can be no assurance that the value of ATH will increase, and investors should carefully consider the risks associated with digital assets.

Recent Developments

Renovaro

On January 1, 2025, we entered into a binding letter of intent (the "LOI") with Renovaro, Inc. (NASDAQ: RENB) ("Renovaro") for Predictive Oncology to be acquired by Renovaro (the "Renovaro Merger"). Under the terms of the LOI, Predictive Oncology would be merged into Renovaro in exchange for a newly created series of preferred stock of Renovaro. On February 28, 2025, we entered into an extension agreement with Renovaro (the "Extension Agreement"), pursuant to which the parties amended certain terms of the LOI, including to extend the outside termination date of the LOI from February 28, 2025 to March 31, 2025. No definitive purchase agreement was executed as of March 31, 2025 and the LOI terminated on that date, pursuant to its terms. On April 3, 2025, our Board of Directors notified Renovaro of our decision to discontinue discussions regarding the proposed merger between the two companies. We have no further obligations with respect to the Renovaro Merger, including under the LOI or the Extension Agreement. On May 8, 2025, Renovaro filed a lawsuit in Delaware Chancery Court claiming breaches by us of the LOI and the Extension Agreement and seeking to compel our entry into a merger agreement with Renovaro. The Company does not believe the lawsuit has merit and continues to contest it vigorously. It is not possible to estimate the amount of any loss or range of possible loss that might result from this lawsuit. However, because the final outcome cannot be predicted with certainty, unfavorable or unexpected developments or outcomes could result in a material impact to the Company's financial condition and results of operations.

Eagan Asset Sale to DeRoyal

On March 14, 2025, we entered into an asset purchase agreement and closed the transactions contemplated therein with DeRoyal to sell and assign to DeRoyal assets and liabilities exclusively related to the business of providing products for automated, direct-to-drain medical fluid disposal, including our STREAMWAY® product line, in exchange for a total purchase price of $625,000, plus the assumption of certain liabilities.

Nasdaq Notice of Delisting and Actions to Regain Compliance

On June 9, 2025, we received a letter (the "Notice") from the Listing Qualifications Department (the "Staff") of The Nasdaq Stock Market LLC ("Nasdaq") notifying us that because we had not regained compliance with the minimum $2,500,000 stockholders' equity requirement for continued listing on The Nasdaq Capital Market as set forth in Nasdaq Listing Rule 5550(b)(1) (the "Stockholders' Equity Requirement"), the Staff had determined to delist the Company's securities from The Nasdaq Capital Market.

On June 11, 2025, we submitted a hearing request to Nasdaq's Hearings Panel (the "Panel") and our hearing request was accepted.

On July 8, 2025, we received a letter from the Staff indicating that the bid price for our common stock had closed below $1.00 per share for 30 consecutive business days, and that the Company was therefore not in compliance with the minimum bid price requirement for continued listing under Nasdaq Marketplace Rule 5550(a)(2) (the "Minimum Bid Price Requirement").

On July 17, 2025, we attended an oral hearing with the Panel, where we presented plans for coming into compliance with the continued listing standards, which included, but were not limited to, continued sales of common stock through various offerings and a potential reverse stock split. We requested an exception from the continued listing standards through December 8, 2025, to provide us the ability to evidence compliance with the standards.

On July 23, 2025, we were notified by Nasdaq that the Panel had granted our request for continued listing on The Nasdaq Capital Market pursuant to an extension through December 8, 2025, to demonstrate compliance with all continued listing requirements, including the Stockholders' Equity Requirement and Minimum Bid Price Requirement. We have taken actions to timely satisfy the terms of the Panel's decision, described below.

On September 29, 2025, we completed the Reverse Stock Split, which was effective for trading purposes on September 30, 2025. As a result, our stock price increased significantly, and we regained compliance with the Minimum Bid Price Requirement as confirmed by the Staff via a letter dated October 14, 2025.

For additional information regarding the actions we have taken to satisfy the terms of the Panel's decisions related to the Stockholders' Equity Requirement, refer to the heading below titled "September 2025 Private Placements" containing details regarding the private placements that closed in October 2025.

August 2025 Private Placement

On August 26, 2025, we entered into a securities purchase agreement dated August 26, 2025 (the "August SPA") with an accredited investor pursuant to which we sold and issued 36,237 shares of our common stock (the "August Shares"), at a purchase price of $11.40 per share, in a private placement transaction (the "August Private Placement"). The August Private Placement closed on August 26, 2025. We received gross proceeds from the August Offering of approximately $413,093, before deducting offering expenses. We intend to use the net proceeds from this offering for working capital and general corporate purposes.

The August SPA contains customary representations, warranties, agreements, indemnification rights and obligations of the parties. Pursuant to the terms of the August SPA, we agreed to certain restrictions on the issuance and sale of common stock (and common stock equivalents) following the closing of the August Offering through October 31, 2025, subject to certain exceptions contained therein. In addition, pursuant to the terms of the August SPA, we granted the purchaser in the August Private Placement a 100% participation right in future offerings of our equity securities through October 31, 2025, which was subsequently waived in connection with the September Private Placements (as defined below). Pursuant to the terms of the August SPA, we were required to prepare and file a registration statement with the SEC that registers the August Shares for resale on or prior to the 90th day after the date of the August SPA, which the Company filed on October 22, 2025.

Reverse Stock Split

On September 29, 2025, we effectuated a one-for-fifteen (1:15) reverse stock split (the "Reverse Stock Split") of our common stock. The common stock began trading on Nasdaq on a reverse split-adjusted basis on September 30, 2025. There was no change to the number of authorized shares of common stock or the par value per share of common stock. No fractional shares were issued as a result of the Reverse Stock Split and any fraction of a share of common stock created as a result of the Reverse Stock Split was rounded up to the nearest whole share.

September 2025 Private Placements

Securities Purchase Agreements

On September 29, 2025, we entered into a securities purchase agreement dated September 29, 2025 (the "Cash SPA" and together with the Crypto SPA, the "September SPAs") with certain accredited investors pursuant to which we agreed to sell and issue to such investors in a private placement (the "Cash PIPE Offering") an aggregate of 4,366,703 shares of common stock (or pre-funded warrants to purchase shares of common stock, in lieu thereof). The shares of common stock (the "Cash PIPE Shares") were sold at a purchase price of $11.6265 per share (the "Per Share Purchase Price"), and the pre-funded warrants to purchase shares of common stock (the "Cash PIPE Warrants") were sold at a purchase price per Cash PIPE Warrant equal to the Per Share Purchase Price minus the Cash PIPE Warrant Exercise Price (as defined below), with such purchase price pre-funded on October 7, 2025 (the "Closing Date"). We received aggregate cash gross proceeds of approximately $50.8 million, before deducting placement agent fees and expenses.

The unfunded exercise price of each Cash PIPE Warrant is a fixed nominal amount of $0.01 per underlying Cash PIPE Warrant Share (the "Cash PIPE Warrant Exercise Price"). The exercise price and the number of Cash PIPE Warrant Shares issuable upon exercise of each Cash PIPE Warrant is subject to appropriate adjustment in the event of certain stock dividends, stock splits, stock combinations or similar events affecting the common stock. The Cash PIPE Warrants are exercisable in cash or by means of a cashless exercise, and will have no expiration date. The Cash PIPE Warrants may not be exercised if the aggregate number of shares of common stock beneficially owned by the holder thereof (together with its affiliates) immediately following such exercise would exceed a specified beneficial ownership limitation; provided, however, that a holder may increase or decrease the beneficial ownership limitation by giving notice to the Company (61 days' notice for increases), but not to any percentage in excess of 19.99%.

On September 29, 2025, we entered into a separate securities purchase agreement (the "Crypto SPA") with certain accredited investors pursuant to which we agreed to sell and issue to such investors in a private placement (the "Crypto PIPE Offering" and collectively with the Cash PIPE Offering, the "September Private Placements") warrants (the "Crypto PIPE Warrants") to purchase an aggregate of up to 14,903,393 shares of common stock (the "Crypto PIPE Warrant Shares") at a purchase price per Crypto PIPE Warrant equal to the Per Share Purchase Price minus the Crypto PIPE Warrant Exercise Price (as defined below), with such purchase price being pre-funded on the Closing Date. The purchasers in the Crypto PIPE Offering tendered ATH to us as consideration for the Crypto PIPE Warrants. We received in-kind contributions of locked and unlocked ATH with an aggregate notional value of approximately $292.7 million, representing a discounted value of approximately $173.3 million.

The unfunded exercise price of each Crypto PIPE Warrant is a fixed nominal amount of $0.01 per underlying Share (the "Crypto PIPE Warrant Exercise Price" and together with the Cash PIPE Warrant Exercise Price, the "Warrant Exercise Prices"). The Crypto PIPE Warrants may not be exercised for common stock prior to the receipt of shareholder approval for the issuance of the shares of common stock underlying the Crypto PIPE Warrants. The exercise price and the number of shares of common stock issuable upon exercise of each Crypto PIPE Warrant is subject to appropriate adjustment in the event of certain stock dividends, stock splits, stock combinations, or similar events affecting the common stock. The Crypto PIPE Warrants are exercisable in cash or by means of a cashless exercise and will have no expiration date. The Crypto PIPE Warrants may not be exercised if the aggregate number of shares of common stock beneficially owned by the holder thereof (together with its affiliates) immediately following such exercise would exceed a specified beneficial ownership limitation; provided, however, that a holder may increase or decrease the beneficial ownership limitation by giving notice to the Company (61 days' notice for increases), but not to any percentage in excess of 19.99%.

The September SPAs contain customary representations, warranties, agreements, indemnification rights and obligations of the parties. Pursuant to the September SPAs, we agreed to certain restrictions on the issuance and sale of our equity securities for a period beginning on the date of the September SPAs until the 180^th day following the date on which a Resale Registration Statement (as defined below) filed pursuant to the Registration Rights Agreement (as defined below) becomes effective, subject to certain customary exceptions, including, without limitation, issuances (i) contemplated by the September SPAs, (ii) pursuant to employee benefit plans or (iii) pursuant to any at-the-marketing offering sales agreement or similar agreement.

The September Private Placements closed on October 7, 2025. We intend to use the in-kind contribution of ATH to fund the Treasury Strategy and to use the remaining net proceeds from the September Private Placements primarily to fund the acquisition of ATH in the open market in support of the Treasury Strategy, as well as for working capital and general corporate purposes.

Side Letter

On September 29, 2025, in connection with the September Private Placements, we entered into a side letter agreement (the "Side Letter") with DCI, effective on the Closing Date. The Side Letter provides that DCI will be responsible if any digital assets contributed pursuant to the Crypto SPA that are subject to transfer restrictions (the "Locked Crypto") are not released from such restrictions as expected or cannot be used by the Company due to issues attributable to DCI, and entitles the Company to seek equitable relief if DCI does not cure such failure within five business days of notice. The Side Letter further provides that for each ATH token purchased by us on the open market, whether through a centralized exchange or a decentralized exchange operating on the Ethereum Network, DCI will grant to us an additional 20% of the number of ATH tokens so purchased. In addition, DCI makes certain representations regarding the ability of the Locked Crypto to generate yield and that the vesting provisions applicable to the Locked Crypto will not interfere with the Treasury Strategy, and the Side Letter further provides that DCI will have no claims against us in connection with any disputes relating to the valuation or contribution of Locked Crypto.

Wainwright Engagement Agreement

Wainwright acted as the exclusive placement agent in connection with the September Private Placements. Pursuant to that certain engagement agreement we entered into with Wainwright, dated May 14, 2024, as amended on February 18, 2025, June 1, 2025 and September 21, 2025 (the "Engagement Agreement"), Wainwright was entitled to a cash fee of 5% of the gross cash proceeds paid by investors in the September Private Placements (excluding any proceeds tendered to us in the form of digital assets). Additionally, we agreed to issue Wainwright (or its designees) up to 218,335 shares of common stock issuable upon the exercise of warrants (the "Agent Warrants") equal to 5% of the Cash PIPE Shares and the Cash PIPE Warrants sold pursuant to the Cash SPA. The Agent Warrants are exercisable for five years from the date of issuance at an exercise price equal to $11.6265 per share. We also agreed to reimburse Wainwright for its reasonable expenses in connection with the September Private Placements.

Strategic Advisor Agreement

On October 7, 2025, in connection with the Treasury Strategy, we entered into a strategic advisor agreement (the "Strategic Advisor Agreement") with DNA, pursuant to which we engaged DNA as a non-exclusive strategic advisor to provide financial advisory services related to digital asset strategies and business development initiatives. As compensation for its services under the Strategic Advisor Agreement, we issued 1,348,906 shares of common stock (the "Advisor Warrant Shares") issuable upon the exercise of warrants (the "Advisor Warrants") to DNA. The Advisor Warrants are exercisable for five years from the date of issuance at an exercise price equal to $11.6265 per share. The Advisor Warrants include a beneficial ownership limitation of 4.99% (or, at the election of DNA, 9.99%) of the common stock, and provide for cashless exercise and piggyback registration rights. The Strategic Advisor Agreement contains customary representations and warranties, confidentiality provisions, and limitations on liability.

Asset Management Agreement

On October 7, 2025, in connection with the Treasury Strategy, we entered into an asset management agreement (the "Asset Management Agreement") with DNA, pursuant to which DNA, in its capacity as our asset manager (the "Asset Manager"), will provide discretionary asset management services with respect to certain of our digital assets, including cryptocurrency and tokens (the "Account Assets"). The Account Assets will include, at our discretion, cash proceeds from securities offerings, ATH, stablecoin proceeds, and any additional assets designated by the Company, excluding assets attributable to our AI-driven drug development business.

As compensation for its services, the Asset Manager will be entitled to an asset-based management fee equal to 1.00% per annum of the Account Assets, calculated and paid quarterly in advance, as well as an incentive fee equal to 25% of any profits earned on the Account Assets in excess of 7%. We will be responsible for all reasonable and documented expenses related to the operation of the account holding the Account Assets, including custodial, banking, brokerage, transaction, and other related fees.

The initial term of the Asset Management Agreement will be ten years, with automatic one-year renewal periods unless terminated by either party in accordance with the Asset Management Agreement. The Asset Management Agreement may be terminated by us for cause, including fraud, gross negligence, willful misconduct, or material breach by the Asset Manager, or by the Asset Manager for cause or upon certain acts of insolvency, each as described in the Asset Management Agreement. While the Asset Manager will be our exclusive asset manager, the Asset Manager may nonetheless provide similar services to other clients, and the Asset Manager or its affiliates may engage in transactions for their own accounts. The Asset Management Agreement contains customary representations, warranties, confidentiality, indemnification and limitation of liability provisions, and is governed by the laws of the State of New York.

Registration Rights Agreement

In connection with the September Private Placements, we entered into a registration rights agreement, dated September 29, 2025 (the "Registration Rights Agreement") with the purchasers under the September SPAs, providing for the registration of the resale of the Crypto PIPE Warrant Shares, Cash PIPE Shares, Cash PIPE Warrant Shares and Advisor Warrant Shares, and any securities issued or then issuable upon any share split, dividend or other distribution, recapitalization or similar event with respect to the foregoing (collectively, the "Registrable Securities") on one or more registration statements (collectively, the "Resale Registration Statements") to be filed with the SEC no later than the 15th calendar day following the Closing Date. We have agreed to use our best efforts to cause the Resale Registration Statements to be declared effective as promptly as possible, but in no event later than, in respect of the Cash PIPE Shares and Cash PIPE Warrant Shares, the thirtieth calendar day following the filing date (or, in the case of a full review by the SEC, the sixtieth day thereafter), or in respect of the Resale Registration Statement to be filed for the Crypto PIPE Warrant Shares, the fifth trading day following receipt of notice by the SEC that such Resale Registration Statement will not be reviewed or is no longer subject to further review, and to keep such Resale Registration Statements continuously effective from the date on which the SEC declares them to be effective (or the Resale Registration Statements go effective pursuant to their terms) until the date that all Registrable Securities covered by such Resale Registration Statements (i) have been sold, thereunder or pursuant to Rule 144, or (ii) may be sold without volume or manner-of-sale restrictions pursuant to Rule 144 and without the requirement for the Company to be in compliance with the current public information requirement under Rule 144.

Lock-up Agreement

In connection with the September Private Placements, the directors and certain officers of the Company agreed not to sell, pledge or otherwise dispose of any shares of common stock or securities convertible thereinto or exercisable therefor for a period of ninety (90) days following the date on which the Resale Registration Statements are declared effective by the SEC.

Board Resignations and Appointments

On September 25, 2025, Nancy Chung-Welch, Ph.D. resigned from our Board effective as of the Closing Date. On September 26, 2025, Shawn Matthews, the Chief Executive Officer of DNA, was appointed to the Board as a Class II director, effective as of the Closing Date, to serve for as long as DNA, directly or indirectly, holds at least 10% of the shares of common stock and common stock equivalents purchased pursuant to the September SPAs, pursuant to the nomination right set forth in Section 4.20 of the Crypto SPA (the "Nomination Right") or until DNA designates another individual to serve as a director pursuant to the Nomination Right.

Capital Requirements

Since inception, we have been unprofitable. We incurred losses from continuing operations of $68,437,048 and $8,150,654 for the nine months ended September 30, 2025 and 2024, respectively. As of September 30, 2025 and December 31, 2024, we had an accumulated deficit of $249,117,449 and $180,426,271, respectively.

We have never generated sufficient revenues to fund our capital requirements. We have funded our operations through a variety of debt and equity instruments. Since 2017, we have diversified our business by investing in ventures, including making significant loans and investments in early-stage companies. These activities led to the acquisition of Helomics Corporation in April 2019 and the acquisition of zPREDICTA Inc. in November 2021, each of which accelerated our capital needs. Since 2023, we have monetized certain assets and curtailed expenses. In September 2025, we adopted the Treasury Strategy, providing new sources of capital and creating additional capital needs. See "Liquidity and Capital Resources - Liquidity and Plan of Financing" and "Liquidity and Capital Resources - Financing Transactions" below.

Our future cash requirements and the adequacy of available funds depend on our ability to generate revenues from and reach profitability in our oncology drug discovery business, our ability to generate income from our Treasury Strategy, and the availability of future financing to fulfill our business plans. See "Liquidity and Capital Resources - Liquidity and Plan of Financing" below.

Our recent adoption of the Treasury Strategy makes prediction of future operating results difficult. We believe that period-to-period comparisons of our operating results should not be relied on as predictive of our future results.

Results of Operations

Comparison of three and nine months ended September 30, 2025 and 2024

In July 2024, our Board of Directors approved a plan to dispose of the assets and discontinue the operations of our Birmingham laboratory. On March 14, 2025, we entered into an asset purchase agreement and closed the transactions contemplated therein with DeRoyal Industries, Inc. ("DeRoyal"), to sell and assign to DeRoyal assets and liabilities exclusively related to the business of providing products for automated, direct-to-drain medical fluid disposal, including the STREAMWAY® product line, which constituted our Eagan operating segment, in exchange for a total purchase price of $625,000, plus the assumption of certain liabilities.

As a result of these developments, the former Birmingham and Eagan operating segments have been reflected as discontinued operations in the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. Additional disclosures regarding discontinued operations, including results from discontinued operations, are provided in Note 2, Discontinued Operations, to the unaudited condensed consolidated financial statements of this Quarterly Report on Form 10-Q.

		Three Months Ended September 30,												Nine Months Ended September 30,
		2025				2024				Difference				2025				2024				Difference
Revenue		$	3,618			$	3,907			$	(289	)		$	116,610			$	76,020			$	40,590
Cost of sales			8,356				11,177				2,821				71,695				47,468				(24,227	)
General and administrative expenses			2,613,075				1,545,271				(1,067,804	)			6,316,930				5,696,109				(620,821	)
Operations, research and development expenses			528,557				535,236				6,679				1,548,678				1,724,013				175,335
Sales and marketing expenses			133,494				72,667				(60,827	)			406,086				815,563				409,477
Other income			2,631				36,379				(33,748	)			688,483				64,497				623,986
Gain (loss) on derivative instruments			(74,366,000	)			7				(74,366,007	)			(74,366,000	)			1,375				(74,367,375	)

Revenue. We recorded revenue of $3,618 and $3,907 in the three months ended September 30, 2025 and 2024, respectively. Revenue in the three months ended September 30, 2025 was largely unchanged from the comparable period in 2024.

We recorded revenue of $116,610 and $76,020 in the nine months ended September 30, 2025 and 2024, respectively. The increase in revenue from the comparative period was primarily due to completion of a tumor-specific 3D model in the 2025 period, while no tumor-specific 3D models were completed in the comparable 2024 period.

Cost of sales. Cost of sales was $8,356 and $11,177 in the three months ended September 30, 2025 and 2024, respectively. Gross margin was primarily driven by overhead costs, including indirect labor, associated with our clinical laboratory.

Cost of sales was $71,695 and $47,468 in the nine months ended September 30, 2025 and 2024, respectively. The gross profit margin was approximately 39% and 38% in the nine months ended September 30, 2025 and 2024, respectively. Gross margin was primarily driven by direct labor costs and overhead costs, including indirect labor, associated with our clinical laboratory.

General and administrative expenses. General and administrative ("G&A") expenses primarily consist of management salaries, professional fees, consulting fees, administrative fees, and general office expenses. G&A expenses increased by $1,067,804 to $2,613,075 in the three months ended September 30, 2025, compared to $1,545,271 in the comparable period in 2024. The increase was primarily due to increased legal fees and increased stock-based compensation expense, offset by decreased employee salaries and benefits resulting from lower headcount. Stock-based compensation expense increased due to restricted stock units granted during the three months ended September 30, 2025 to employees, directors, and consultants.

G&A expenses increased by $620,821 to $6,316,930 in the nine months ended September 30, 2025, compared to $5,696,109 in the comparable period in 2024. The increase was primarily due to increased legal fees and increased stock-based compensation expense, partially offset by decreased fees to consultants and outside advisors, as well as decreased salaries and benefits to employees. Legal fees increased primarily due to the Renovaro lawsuit and corporate development activities during the nine months ended September 30, 2025. Stock-based compensation expense increased due to restricted stock units granted during the nine months ended September 30, 2025 to employees, directors, and consultants. Employee salaries and benefits decreased due to lower headcount in general and administrative departments.

Operations, research and development expenses. Operations, research and development expenses primarily consist of expenses related to product development, prototyping, and testing. Operations, research and development expenses decreased by $6,679 to $528,557 in the three months ended September 30, 2025 compared to $535,236 in the comparable period in 2024. The decrease was primarily due to decreased consultant fees and lower purchases of laboratory supplies, partially offset by increased stock-based compensation expense.

Operations, research and development expenses decreased by $175,335 to $1,548,678 in the nine months ended September 30, 2025, compared to $1,724,013 in the comparable period in 2024. The decrease was primarily driven by decreased salaries and benefits due to lower headcount and decreased consultant fees, partially offset by increased stock-based compensation expense related to restricted stock units granted during the three months ended September 30, 2025 to employees.

Sales and marketing expense. Sales and marketing expenses consist of expenses required to market and sell our products and services. Sales and marketing expenses increased by $60,827 to $133,494 in the three months ended September 30, 2025, compared to $72,667 in the comparable period in 2024. The increase was primarily due to increased fees for digital marketing consultants, partially offset by lower employee compensation resulting from lower headcount.

Sales and marketing expense decreased by $409,477 to $406,086 in the nine months ended September 30, 2025, compared to $815,563 in the comparable period in 2024. The decrease was primarily due to decreased employee compensation, including severance related to a former executive recorded in 2024 and a reduction in headcount following separation of marketing employees in the third quarter of 2024, partially offset by increased fees for digital marketing consultants.

Other income. We recognized other income of $2,631 during the three months ended September 30, 2025, compared to $36,379 in the comparable period in 2024. We recognized other income of $688,483 during the nine months ended September 30, 2025, compared to $64,497 in the comparable period in 2024. Other income in the 2025 periods primarily related to the write off of aged accounts payable and related accrued expenses, while other income in the 2024 periods primarily consisted of interest income.

Gain (loss) on derivative instruments. We recognized losses on the change in fair value of derivative instruments of $74,366,000 in the three and nine months ended September 30, 2025. Losses on derivative instruments recognized during the 2025 period relate to the Crypto PIPE Offering entered into on September 29, 2025. During the three and nine months ended September 30, 2024, we recognized gains on the change in fair value of derivative instruments of $7 and $1,375, respectively. Gains recognized in the 2024 period related to certain warrants issued to placement agents in 2020.

Liquidity and Capital Resources

Cash Flows

On September 30, 2025, we had $181,667 in cash and cash equivalents. Cash and cash equivalents from continuing operations decreased by $430,155 from December 31, 2024, due to the following factors.

Net cash used in operating activities of continuing operations was $5,934,497 in the nine months ended September 30, 2025, compared to $8,049,679 in the nine months ended September 30, 2024. Cash used in operating activities of continuing operations decreased in the 2025 period primarily due to lower cash operating losses and decreased cash used in working capital. Lower cash operating losses were primarily due to decreased cash outflows for operating expenses. Cash used in working capital decreased due to an increase in accounts payable as well as accrued expenses and other current liabilities, offset by increases in cash used in prepaid expenses and operating lease liabilities.

No cash was used in or provided by investing activities of continuing operations in the nine months ended September 30, 2025, while $3,032 was used in investing activities of continuing operations in the nine months ended September 30, 2024 to acquire property and equipment.

Net cash provided by financing activities of continuing operations was $4,555,905 in the nine months ended September 30, 2025, compared to $4,134,970 provided by financing activities of continuing operations in the nine months ended September 30, 2024. Cash provided by financing activities of continuing operations in the 2025 period was primarily related to proceeds from the exercise of warrants to purchase common stock, proceeds from the issuance of common stock pursuant to the ATM offering, proceeds from the issuance of common stock pursuant to the Extension Agreement with Renovaro, proceeds from the issuance of common stock pursuant to a Registered Direct Offering, and proceeds from private placements of common stock with accredited investors in May and August, while the cash provided in the 2024 period was primarily related to proceeds from the issuance of common stock pursuant to the ATM offering in May 2024 and the Warrant Inducement Transaction completed in July 2024.

Net cash provided by discontinued operations was $825,586 in the nine months ended September 30, 2025, compared to $1,731,963 used in discontinued operations in the nine months ended September 30, 2024. Net cash provided by operating activities of discontinued operations for the nine months ended September 30, 2025, was $200,586, while net cash used in operating activities of discontinued operations for the nine months ended September 30, 2024, was $1,757,485. This change primarily relates to decreased cash losses due to ceasing the discontinued operations. Net cash provided by investing activities of discontinued operations was $625,000 for the nine months ended September 30, 2025, while net cash provided by investing activities of discontinued operations was $25,552 for the nine months ended September 30, 2024. The cash provided in the 2025 period related to proceeds from the sale of Eagan assets pursuant to the asset purchase agreement executed with DeRoyal in March 2025.

Liquidity and Plan of Financing

At the time of the issuance of the Company's 2025 second quarter Form 10-Q, substantial doubt about the Company's ability to continue as a going concern existed. The Company had incurred significant and recurring losses from operations for the past several years and, as of June 30, 2025, had an accumulated deficit of $184,939,606. The Company had cash and cash equivalents of $506,078 as of June 30, 2025, and needed to raise significant additional capital to meet its operating needs. The Company had short-term obligations of $3,845,439 and long-term operating lease obligations of $1,243,327 as of June 30, 2025. During the six months ended June 30, 2025, the Company incurred negative cash flows from continuing operating activities of $4,280,632.

As discussed above under the heading "September 2025 Private Placements" and disclosed in Note 15, Subsequent Events to the unaudited condensed consolidated financial statements of this Quarterly Report on Form 10-Q, on October 7, 2025, the Company closed two private placements, pursuant to which the Company received aggregate cash gross proceeds of approximately $50.8 million. The Company believes that its working capital and cash position will be sufficient to fund its on-going operations for a period of at least 12 months subsequent to the issuance of these condensed consolidated financial statements.

ATH Holdings

On November 10, 2025, we held approximately 5.70 billion ATH, with a market value of approximately $152.8 million, based on a price of $0.0268 per ATH, the price reported on the Coinbase exchange as of 4:00 p.m. Eastern Time on such date, of which 3.7 billion ATH are locked and subject to vesting and/or transfer restrictions and 2.0 billion ATH are unlocked.

Short-Term Liquidity

Our short-term liquidity needs include working capital requirements, anticipated capital expenditures, and contractual obligations due within the next twelve months. Our cash and cash equivalents as of September 30, 2025, together with cash and cash equivalents generated by our operations, were not expected to be sufficient to satisfy these needs over the next months. However, we received additional cash proceeds from the September 2025 Private Placements that closed on October 7, 2025, a portion of which is expected to be used for general corporate purposes and working capital, and we anticipate being able to use proceeds from additional equity or debt financings to meet these needs. Our ability to obtain equity and debt financing is subject to market conditions and other factors outside of our control, and we may not be able to obtain equity or debt financing in a timely manner, on favorable terms, or at all. Although we do not anticipate needing to use our ATH to meet our short-term liquidity needs, to the extent necessary, we would seek to use proceeds from the sale of our ATH to meet such needs. See "-Availability of ATH for Liquidity" below and "Item 1A. Risk Factors" for additional information.

Long-Term Liquidity

Beyond the next 12 months, our long-term cash needs are primarily for obligations related to working capital needs. We expect our cash and cash equivalents as of September 30, 2025, together with cash and cash equivalents generated by our operations, may not be sufficient to satisfy these needs. As a result, we will seek to satisfy these needs through various options that we expect to be available to us, such as proceeds from equity or debt financings, or the sale of our ATH. See "-Availability of ATH for Liquidity" below and "Item 1A. Risk Factors" for additional information.

Availability of ATH for Liquidity

We do not believe we will need to sell or engage in other transactions with respect to any of our ATH within the next 12 months to meet our liquidity needs, although we may from time to time sell or engage in other transactions with respect to our ATH as part of treasury management operations. The ATH market historically has been characterized by significant volatility in its price, limited liquidity and trading volumes compared to sovereign currencies markets, relative anonymity, a developing regulatory landscape, susceptibility to market abuse and manipulation, compliance and internal control failures at exchanges, and various other risks inherent in its entirely electronic, virtual form and decentralized network. During times of instability in the ATH market, we may not be able to sell our ATH at reasonable prices or at all. As a result, our ATH are less liquid than our existing cash and cash equivalents and may not be able to serve as a source of liquidity for us to the same extent as cash and cash equivalents. In addition, upon sale of our ATH, we may incur additional taxes related to any realized gains or we may incur capital losses as to which the tax deduction may be limited. See "Item 1A. Risk Factors" for additional information.

Financing Transactions

We have primarily funded our operations through a combination of debt and equity instruments including short-term borrowings, and a variety of debt and equity offerings. We have no off-balance sheet transactions.

Registered Direct Offering

On February 18, 2025, we entered into a Securities Purchase Agreement (the "Purchase Agreement") with several institutional and accredited investors for the sale by us of 24,223 shares (the "Registered Direct Offering Shares") of our common stock, par value $0.01 per share, at a purchase price of $22.50 per share, in a registered direct offering. The offering closed on February 19, 2025. Our gross proceeds from the offering were approximately $545,000, before deducting the placement agent's fees and other offering expenses. We offered and sold the Registered Direct Offering Shares pursuant to an effective shelf registration statement on Form S-3, which was filed with the SEC on May 21, 2024, and subsequently declared effective on May 21, 2024 (File No. 333-279123), and a related prospectus supplement filed on February 19, 2025.

We agreed to pay Wainwright, as placement agent, an aggregate fee equal to 7.0% of the gross proceeds we received from the sale of the securities in the offering as well as a management fee equal to 1.0% of such gross proceeds, and $15,000 for fees and expenses of legal counsel. We also issued to Wainwright, or its designees, warrants to purchase up to 7.0% of the aggregate number of shares of our common stock sold in the transactions, or warrants to purchase up to an aggregate of 1,698 shares of our common stock (the "Registered Direct Offering Placement Agent Warrants"). The Registered Direct Offering Placement Agent Warrants are exercisable for five years from the commencement of sales in the offering and have an exercise price equal to 125% of the purchase price of shares of our common stock sold in the offering, or $28.13 per share. The Registered Direct Offering Placement Agent Warrants and the shares issuable upon exercise of the Registered Direct Offering Placement Agent Warrants were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act as transactions not involving a public offering and in reliance on similar exemptions under applicable state laws.

Renovaro Subscription Agreement

On March 13, 2025, we executed a share subscription agreement with Renovaro, pursuant to the Extension Agreement dated February 28, 2025, that amended the previous LOI between the parties. Pursuant to the share subscription agreement, Renovaro subscribed to purchase and we agreed to sell 31,153 unregistered shares of our common stock at a price of $16.05 per share for a total purchase price of $500,000. The closing of this share issuance occurred on March 17, 2025.

May 2025 Private Placement

On May 13, 2025, we executed a share subscription agreement with an institutional and accredited investor for the sale, in a private placement, by the Company of 18,692 shares of our common stock at a price of $16.05 per share for a total purchase price of $300,000. The closing of this share issuance occurred on June 3, 2025.

At The Market Offering

On May 3, 2024, we entered into an ATM Sales Agreement (the "Sales Agreement") with Wainwright, pursuant to which we may offer and sell, from time to time, through Wainwright, shares of our common stock through an "at the market offering" program pursuant to which Wainwright will act as sales agent. Subject to the terms and conditions of the Sales Agreement, Wainwright is permitted to sell the shares by methods deemed to be an "at the market offering" as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended. The Sales Agreement provides that Wainwright will be entitled to compensation for its services of 3.0% of the gross sales price of all shares sold through Wainwright under the Sales Agreement. We are subject to certain restrictions on our ability to offer and sell shares of our common stock under the Sales Agreement.

On May 6, 2024, following execution of the Sales Agreement, we filed with the SEC a shelf registration statement on Form S-3 (the "May 2024 Shelf Registration Statement"). The May 2024 Shelf Registration Statement, as amended, was declared effective by the SEC on May 21, 2024 and included a prospectus supplement (the "Initial ATM Prospectus Supplement") to the base prospectus related to the offering of up to $3,696,000 of shares of our common stock under the Sales Agreement. As of May 31, 2024, we had offered and sold 107,140 shares of common stock under the Initial ATM Prospectus Supplement for gross proceeds of approximately $3,696,000. The net proceeds from the shares offered and sold in May 2024, after deducting commissions and offering expenses, were approximately $3,122,000.

On April 18, 2025, in accordance with the terms of the Sales Agreement, we filed a prospectus supplement to the May 2024 Shelf Registration Statement relating to the offer and sale of up to an additional $1,491,000 of shares of our common stock.

On June 2, 2025, in accordance with the terms of the Sales Agreement, we determined to further increase the number of shares it may sell under the Sales Agreement, from the approximately $1,352,000 remaining as of May 31, 2025 up to an aggregate of $3,398,000, and we filed an additional prospectus supplement with the SEC on June 2, 2025.

As of September 30, 2025, approximately $2,292,000 remained available to us for sales of our common stock under the Sales Agreement.

During the three months ended September 30, 2025, we issued and sold 78,356 shares of common stock under the Sales Agreement resulting in net proceeds to us of approximately $921,000 after deducting approximately $38,000 in issuance costs. During the nine months ended September 30, 2025, we issued and sold 97,343 shares of common stock under the Sales Agreement resulting in net proceeds to us of approximately $1,084,000 after deducting approximately $161,000 in issuance costs.

August 2025 Private Placement

On August 26, 2025, we entered into a securities purchase agreement dated August 26, 2025 with an accredited investor pursuant to which we sold and issued 36,237 shares of our common stock, at a purchase price of $11.40 per share, in a private placement transaction. This issuance closed on August 26, 2025.

September 2025 Private Placements

On September 29, 2025, we entered into two securities purchase agreements, as further described above under "Recent Developments - September 2025 Private Placements."

In the Cash PIPE Offering, we sold an aggregate of 4,366,703 shares of our common stock (or pre-funded warrants at a nominal $0.01 exercise price per share to purchase shares of common stock, in lieu thereof) to certain accredited investors for $11.6265 per share. Aggregate Cash PIPE Offering proceeds were $50.8 million before issuance fees and expenses.

In the Crypto PIPE, we sold the Crypto PIPE Warrants to purchase up to 14,903,393 shares of our common stock at a nominal $0.01 exercise price per share. As consideration for the Crypto PIPE Warrants, we received ATH from purchasers, including Locked ATH, with an aggregate notional value and discounted value of $292.7 million and $173.3 million, respectively.

The September Private Placements closed on October 7, 2025. The Company intends to use the ATH received in-kind in the Crypto PIPE Offering to fund its Treasury Strategy, and to use net cash proceeds primarily to acquire ATH in the open market, as well as for working capital and general corporate purposes.

Accounting Standards and Recent Accounting Developments

See Note 1, Organization and Summary of Significant Accounting Policies, to the unaudited condensed consolidated financial statements of this Quarterly Report on Form 10-Q for a discussion of recent accounting developments.