Aethlon Medical, Inc. 10-K
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
☒ ANNUAL REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended March 31, 2026
OR
☐ TRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to __________
COMMISSION FILE NUMBER 001-37487
Aethlon Medical, Inc.
(Exact name of registrant as specified in its charter)
San Diego, California 92121
(Address of principal executive office) (Zip Code)
REGISTRANT’S TELEPHONE NUMBER, INCLUDING AREA
CODE: (619) 941-0360
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF
THE EXCHANGE ACT:
SECURITIES REGISTERED UNDER SECTION 12(g) OF THE EXCHANGE
ACT:
NONE
(TITLE OF CLASS)
Indicate by check mark if the registrant is a well-known seasoned issuer,
as defined in Rule 405 of the Securities Act. Yes ☐ No ☒
Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or 15(d) of the Act. Yes ☐ No ☒
Indicate by check mark whether the registrant (1)
has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has
submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of
this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes
☒ No ☐
Indicate by check mark whether the registrant is a
large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See
the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and
“emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one)
Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated filer ☒ Smaller reporting company ☒
Emerging growth company ☐
If an emerging growth company, indicate by check mark
if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards
provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has
filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting
under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its
audit report. ☐
If securities are registered pursuant to Section 12(b)
of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of
an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error
corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s
executive officers during the relevant recovery period pursuant to § 240.10D-1(b). ☐
Indicate by check mark whether the registrant is a
shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
The aggregate market value of the common stock held
by non-affiliates of the registrant as of September 30, 2025 (the last trading day of the registrant’s most recently completed second
quarter) was approximately $5.67 million, computed by reference to the closing sale price of the common stock of $7.49 per share on the
Nasdaq Capital Market on September 30, 2025. Shares of common stock held by each executive officer and director and by each person who
owns 10% or more of the outstanding common stock have been excluded in that such persons may be deemed to be affiliates. The determination
of affiliate status is not necessarily a conclusive determination for other purposes.
The number of shares of the common stock of the registrant
outstanding as of June 8, 2026 was 2,370,560.
TABLE OF CONTENTS
PAGE
PART I
Item 1. Business 1
Item 1A. Risk Factors 12
Item 1B. Unresolved Staff Comments 50
Item 1C. Cybersecurity 51
Item 2. Properties 52
Item 3. Legal Proceedings 52
Item 4. Mine Safety Disclosures 52
PART II
Item 6. [Reserved] 53
Item 7A. Quantitative and Qualitative Disclosures about Market Risk 61
Item 8. Financial Statements and Supplementary Data 61
Item 9A. Controls and Procedures 61
Item 9B. Other Information 62
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 62
PART III
Item 10. Directors, Executive Officers and Corporate Governance 63
Item 11. Executive Compensation 68
Item 14. Principal Accountant Fees and Services 79
PART IV
Item 15. Exhibits and Financial Statement Schedules 80
Signatures 84
i
CAUTIONARY NOTICE REGARDING FORWARD LOOKING STATEMENTS
This Annual Report on Form 10-K,
or Annual Report, contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933,
as amended, or Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, which are
subject to the safe harbor created by those sections.
We may, in some cases, use
words such as “anticipate,” “believe,” “could,” “estimate,” “expect,”
“intend,” “may,” “plan,” “potential,” “predict,” “project,”
“should,” “will,” “would” or the negative of these terms, and similar expressions that convey
uncertainty of future events or outcomes to identify these forward-looking statements. Any statements contained herein that are not
statements of historical facts may be deemed to be forward-looking statements and are based upon our current expectations, beliefs,
estimates and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond our control.
Such statements, include, but are not limited to, statements contained in this Annual Report relating to our business, business
strategy, products and services we may offer in the future, the timing and results of future regulatory filings, the timing and
results of future clinical trials, and capital outlook. Forward-looking statements are based on our current expectations and
assumptions regarding our business, the economy and other future conditions. Because forward looking statements relate to the
future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Our actual
results may differ materially from those contemplated by the forward-looking statements. They are neither statements of historical
fact nor guarantees of assurance of future performance. We caution you therefore against relying on any of these forward-looking
statements. Important factors that could cause actual results to differ materially from those in the forward looking statements
include, but are not limited to, a decline in general economic conditions nationally and internationally; the ability to protect our
intellectual property rights; competition from other providers and products; risks in product development; inability to raise
capital to fund continuing operations; changes in government regulation; the ability to complete capital raising transactions, and
other factors (including the risks contained in Item 1A of this Annual Report under the heading “Risk Factors”) relating
to our industry, our operations and results of operations and any businesses that may be acquired by us. Should one or more of these
risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly
from those anticipated, believed, estimated, expected, intended or planned.
Factors or events that could
cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them, nor can we assess
the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ
materially from those contained in any forward-looking statements we may make. Given these uncertainties, you should not place undue
reliance on these forward-looking statements. We cannot guarantee future results, levels of activity, performance or achievements. Except
as required by applicable law, we undertake no obligation to and do not intend to update any of the forward-looking statements to conform
these statements to actual results.
ii
SUMMARY RISK FACTORS
Below is a summary of the principal
factors that make an investment in our securities speculative or risky. This summary does not address all of the risks that we face. Additional
discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the heading “Risk Factors” in Part I of this Annual Report and should be carefully considered, together with other information in this Annual Report
and our other filings with the SEC before making investment decisions regarding our securities.
· Our Hemopurifier technology may become obsolete.
· Our success is dependent in part on our executive officers.
iii
PART I
ITEM 1. BUSINESS
Unless otherwise indicated or
the context otherwise requires, references to the “Company”, “Aethlon”, “we”, “us” and
“our” refer to Aethlon Medical, Inc.
Overview and Corporate History
Overview
We are a medical therapeutic company
focused on developing the Hemopurifier® (HP), a clinical-stage investigational immunotherapeutic device designed to address unmet
needs in oncology, life-threatening infectious diseases, organ transplantation and other disease states in which extracellular vesicles
(EVs) contribute to disease progression. The Hemopurifier utilizes a proprietary lectin-based technology to bind and remove enveloped
viruses and EVs from biological fluids. EVs have been associated with immune suppression, metastasis, and resistance to therapy in cancer,
as well as progression of severe infectious diseases.
In pre-clinical studies, the Hemopurifier has
also demonstrated the ability to bind disease-associated extracellular vesicles (“EVs”) and a panel of enveloped viruses.
The Hemopurifier has been evaluated in human studies, involving 173 treatment sessions in 44 patients with either viral infections or
cancer. The device has been well tolerated with an adverse event profile that is consistent with extracorporeal therapy. In certain human
studies designed to evaluate viral clearance from biological fluids, findings demonstrated the removal of enveloped viruses. The U.S.
Food and Drug Administration (“FDA”) has granted the Hemopurifier “Breakthrough Device” designation for two independent
indications:
We are
currently advancing clinical development activities for the Hemopurifier in oncology. We are also evaluating the Hemopurifier’s
potential in additional applications based on its mechanism of action and preclinical studies.
We are evaluating the Hemopurifier
as a potential treatment of patients with advanced and metastatic cancer through its ability to bind to and remove extracellular vesicles
(“EVs”) particles that may promote tumor growth and metastasis. In October 2022, we formed a wholly-owned subsidiary in Australia
to support oncology-related clinical research and pursue regulatory approval and potential regulatory and commercialization opportunities
for the Hemopurifier.
We previously completed an in
vitro binding study of utilizing cancer patient samples, to evaluate the Hemopurifier’s ability to remove EVs from plasma. Results
from this translational study provided pre-clinical evidence supporting the design of our oncology clinical trial involving patients with
solid tumors who have stable or progressive disease during anti-PD-1 monotherapy treatment, such as Keytruda® (pembrolizumab) or Opdivo®
(nivolumab).
We are currently conducting a
safety, feasibility and dose-finding clinical trial in Australia evaluating the Hemopurifier in patients with solid tumors who have stable
or progressive disease during anti-PD-1 monotherapy treatment. The trial is designed to enroll approximately 9 to 18 participants. The
primary endpoint of the trial is safety, while exploratory analyses will be conducted to explore the number of HP treatments required
to produce sustained reductions of EVs as well as improve anti-tumor T cell activity.
Three clinical sites in Australia—
Royal Adelaide Hospital in Adelaide, and Pindara Private Hospital on the Gold Coast and GenesisCare North Shore Hospital in Sydney—
are currently open for patient enrollment. During fiscal year 2026, we completed enrollment and treatment of the first cohort of three
participants, each of whom received a single 4-hour Hemopurifier treatment. Following review of the first cohort data, independent Data
Safety Monitoring Board (DSMB) reported no safety concerns and recommended progression to the second cohort. Following the DSMB review
of the first cohort, enrollment commenced in the second cohort, in which participants received two Hemopurifier treatments during a one-week
treatment period. In March 2026, the Company completed the second cohort and the DSMB subsequently approved advancement to the third cohort
of the study. To date, no serious adverse events (“SAEs”) or dose-limiting toxicities ((“DLTs”) related to the
Hemopurifier have been reported.
We previously pursued approval
of a similar oncology clinical trial in India and received formal approval from the Central Drugs Standard Control Organization (“CDSCO”)
on July 7, 2025. Following evaluation of anticipated site activation timelines and trial execution requirements, the Company elected to
not proceed with the India trial in order to conserve resources and focus efforts on the Australian oncology clinical trial.
Life-Threatening Viral Infections
We believe the Hemopurifier may
be applicable in the treatment of life-threatening viral infections involving highly glycosylated, or carbohydrate coated, viruses for
which no approved therapies exist. In small-scale or early feasibility human studies conducted under FDA and international regulatory
frameworks, the Hemopurifier has been used to treat individuals infected with Ebola, human immunodeficiency virus, or HIV, and hepatitis-C
and SARS-CoV-2.
In vitro studies have demonstrated
the ability of the Hemopurifier to capture multiple enveloped viruses, including Ebola, Marburg virus, Zika, Lassa, MERS-CoV, Cytomegalovirus,
Epstein-Barr, Herpes simplex, Chikungunya, Dengue, West Nile, H1N1 swine flu, H5N1 bird flu, and the reconstructed 1918 Spanish flu virus.
In several cases, these studies were conducted in collaboration with leading government or non-government research institutes.
While we terminated our U.S. and
India-based COVID-19 studies due to low ICU patient volume and shifting priorities, these programs provided clinical experience with the
Hemopurifier in critically ill patients. We continue to maintain an open IDE for viral indications, preserving the ability to evaluate
the Hemopurifier in response to future outbreaks or emergent pathogens.
Under this open IDE, in 2014,
the Company filed an Expanded Access protocol with the FDA to treat Ebola virus infected patients in up to ten centers in the United States
and a corresponding protocol was approved by Health Canada. These protocols remain open, allowing Hemopurifier treatment to be offered
to patients presenting for care in both countries.
We have sufficient inventory of
Hemopurifiers to support our ongoing oncology trial in Australia as well as any near-term expansion of that study. While we have received
FDA approval to begin manufacturing at our San Diego facility under our IDE supplement, we are still awaiting FDA approval of a separate
supplement to qualify an additional supplier of a key Hemopurifier component as a second source. We continue to work with the FDA on this
process.
Pre-Clinical Exploration of Additional Clinical
Uses for the Hemopurifier
The Aethlon R&D laboratory
continues to explore potential new indications for the Hemopurifier. We have published in the peer-reviewed journal Transplant Immunology
the ability of the device to remove extracellular vesicles and their microRNA cargo from acellular perfusates of discarded kidneys that
had undergone normothermic machine perfusion.
On May 12, 2025, the results
of our pre-clinical ex vivo study entitled “Ex Vivo Removal of CD41 positive platelet microparticles from Plasma by a Medical Device
containing a Galanthus nivalis agglutinin (GNA) affinity resin” were published in the pre-print vehicle bioRxiv.
Platelet-derived extracellular
vesicles (PD-EVs) are the most numerous EV population in the body and are released by platelets in response to a variety of stimuli. The
cargo contained within these EVs have been noted to take part in damage to blood vessels, activation of immune cells and spread of tumor
cells. Excessive levels of PD-EVs have been implicated in a myriad of diseases including cancer, lupus, systemic sclerosis, multiple sclerosis,
Alzheimer’s disease, sepsis, acute COVID-19 and Long COVID.
In this study, donated healthy
human plasma was circulated through the Hemopurifier (HP) to simulate a clinical HP session. The study demonstrated approximately 98.5%
removal of platelet-derived EVs at a timepoint equivalent to a four-hour HP treatment. We believe the results support the ongoing Australian
oncology clinical trial and may support investigation of the Hemopurifier in additional disease indications.
In November 2025, we publicly
released a separate pre-clinical preprint entitled “Increased mannosylation of extracellular vesicles in Long COVID plasma provides
a potential therapeutic target for Galanthus nivalis agglutinin (GNA) affinity resin,” describing exploratory ex vivo laboratory
research conducted in collaboration with the University of California, San Francisco Long COVID Clinic examining extracellular vesicle
characteristics in plasma samples from individuals with Long COVID. The findings described in these preprints have not been peer reviewed
and are based on laboratory analyses rather than clinical studies. These activities are intended to inform potential future research directions
and evaluate the broader applicability of the Hemopurifier platform and may not be indicative of clinical outcomes.
Successful clinical development
and regulatory approvals will be required before the Hemopurifier may be marketed in the United States or foreign jurisdictions. Some
of our patents may expire before regulatory approval is obtained; however, the Company believes that its existing patent portfolio and
more recently issued patents and patent applications will continue to support protection of the proprietary nature of our Hemopurifier
treatment technology.
We continue to monitor the impact
of inflation, global economic conditions, geopolitical conflicts, capital market volatility and other macroeconomic factors on its business,
operations, clinical development programs and future access to capital. The extent to which these factors may affect the Company’s
business, financial condition and results of operations remains uncertain and will depend on future developments beyond the Company’s
control.
Our executive offices are located
in San Diego, California. Our telephone number is (619) 941-0360. Our website address is www.aethlonmedical.com. The information contained
on, or that can be accessed through, our website is not part of, and is not incorporated into, this Annual Report.
The Mechanism of Action (MOA) of the Hemopurifier
The Hemopurifier is a lectin-affinity
plasmapheresis extracorporeal device designed for the removal of harmful extracellular vesicles and life-threatening enveloped viruses
from the plasma component of the bloodstream. In the United States, the Hemopurifier is classified as a combination product whose regulatory
jurisdiction is the Center for Devices and Radiological Health, or CDRH, the branch of FDA responsible for the premarket approval of all
medical devices.
In our current applications,
our Hemopurifier can be used with approved dialysis machines serving as a blood pump. It could also potentially be developed as part
of a proprietary closed system with its own pump and tubing set, negating the requirement for dialysis infrastructure.
The Hemopurifier - Clinical Experience
Hepatitis C and HIV
The initial clinical development
of the Hemopurifier focused on the viral infections Hepatitis C and HIV. Clinical trials conducted in India and a safety trial demonstrated
the removal of both viruses from the bloodstream with a benign safety profile. Prior to FDA approval of the IDE feasibility study, we
conducted investigational HCV treatment studies at the Apollo Hospital, Fortis Hospital, and the Medanta Medicity Institute in India.
In the Medanta Medicity Institute study, 12 HCV-infected individuals were enrolled to receive three six-hour Hemopurifier treatments during
the first three days of a 48-week peginterferon+ribavirin treatment regimen. The study was conducted under the leadership of Dr. Vijay
Kher. Dr. Kher’s staff reported that Hemopurifier therapy was well tolerated and without device-related adverse events in the 12
patients treated.
Of these 12 patients, ten completed
the Hemopurifier-peginterferon+ribavirin treatment protocol, including eight genotype-1 patients and two genotype-3 patients. Eight of
the ten patients achieved a sustained virologic response, which is the clinical definition of treatment cure and is defined as undetectable
HCV in the blood 24 weeks after the completion of the 48-week peginterferon+ribavirin drug regimen. Both genotype-3 patients achieved
a sustained virologic response, while six of the eight genotype-1 patients achieved a sustained virologic response, which defines a cure
of the infection. Our IDE safety study in end stage renal disease patients on dialysis who were infected with HCV was conducted at DaVita
MedCenter Dialysis in Houston, Texas. We reported that there were no device-related adverse events in enrolled subjects who met the study
inclusion-exclusion criteria. We also reported that an average capture of 154 million copies of HCV (in International Units, I.U.) within
the Hemopurifier during four-hour treatments.
In addition to treating Ebola
and HCV-infected individuals, we also conducted a single proof-of-principle treatment study at the Sigma New Life Hospital in an AIDS
patient who was not being administered HIV antiviral drugs. In the study, viral load was reduced by 93% as the result of 12 Hemopurifier
treatments (each four hours in duration) that were administered over the course of one month.
With the advent of highly effective
anti-retroviral drugs for HIV (HAART), and curative direct acting antivirals (DACs) for Hepatitis C, clinical development for these indications
was abandoned.
Ebola Virus-Single Patient Emergency Use
Under Emergency use conditions
a single patient with Ebola infection with multiple organ dysfunction was treated with the Hemopurifier at Frankfurt University Hospital
in Germany. The patient tolerated a single 6.5-hour Hemopurifier treatment. Prior to treatment, the Ebola viral load was measured at 400,000
copies/ml. The post-treatment viral load was 1,000 copies/ml. Calculations by the treating physician indicated that 242 million copies
of Ebola virus were captured within the Hemopurifier during treatment. The patient made a full recovery. Based on this experience, the
Company filed an Expanded Access protocol with the FDA to treat Ebola virus infected patients in up to ten centers in the United States
and a corresponding protocol was approved by Health Canada. These protocols remain open, allowing Hemopurifier treatment to be offered
to patients presenting for care in both countries. In 2018, the FDA designated the Hemopurifier as a Breakthrough Device ” for the
treatment of life-threatening viruses that are not addressed with approved therapies.”
Severe Acute SARS-CoV-2/COVID-19Infection – Emergency
Use and Clinical Trials
SARS-COV-2, the causative agent
of COVID-19 is a member of the coronavirus family, which includes the original SARS virus, SARS-CoV, and the MERS virus. SARS-CoV-2,
found to contain mannose on the envelope surface. This suggests that the Hemopurifier could potentially clear it from biological fluids,
including blood.
Under Single Patient Emergency
Use regulations, we have treated two patients with COVID-19 with the Hemopurifier. We published a manuscript reviewing case studies covering
those two Single Patient Emergency Use treatments entitled “Removal of COVID-19 Spike Protein, Whole Virus, Exosomes and Exosomal
microRNAs by the Hemopurifier® Lectin-Affinity Cartridge in Critically Ill Patients with COVID-19 Infection” in the peer-reviewed
journal Frontiers in Medicine.
The manuscript described the
use of the Hemopurifier for a total of nine sessions in two critically ill COVID-19 patients. The first case study demonstrated the
improvement in the patient who was a SARS-COV-2 positive COVID-19 present at entry to the hospital, with associated coagulopathy, or
CAC, lung injury, inflammation, and tissue injury despite the absence of demonstrable COVID-19 viremia at the start of treatment at
Day 22. This patient received eight Hemopurifier treatments without complications and eventually was weaned from a ventilator and
was discharged from the hospital. Plasma samples from this patient revealed a decrease in extracellular vesicle counts over the
course of the eight treatments and decreases in exosomal microRNAs associated with the development of coagulopathy and acute lung
injury.
The second patient case study
demonstrated in vivo removal of SARS-CoV-2 virus from the blood stream of an infected patient. This patient completed a six-hour Hemopurifier
treatment without complications and subsequently was placed on continuous renal replacement therapy, or CRRT. The patient ultimately expired
three hours after being placed on CRRT because of the advanced stage of the patient’s disease.
On June 17, 2020, the FDA approved
a supplement to our open IDE for the Hemopurifier in viral disease to allow for the testing of the Hemopurifier in patients with SARS-CoV-2/COVID-19
in a New Feasibility Study. That study was designed to enroll up to 40 subjects at up to 20 centers
in the United States. Subjects had to have an established laboratory diagnosis of COVID-19, be admitted to an ICU, and have acute lung
injury and/or severe or life-threatening disease, among other criteria. Endpoints for this study, in addition to safety, include reduction
in circulating virus, as well as clinical outcomes (NCT # 04595903). In June 2022, the Company completed the treatment protocol for its
first patient in this study.
In
June 2022, the Company completed the treatment protocol of the only participant enrolled in the study. The patient received one HP treatment
daily for 4 days. This patient died following cardiac arrest (not related to the HP treatment) as a consequence of severe COVID-19 pneumonia.
Blood samples taken from the patient did not reveal any evidence of viremia. Plasma sent for cytokine analysis revealed a numeric
decrease in the levels of IP-10, MCP-1, and IL-10.
A similarly designed trial
was also conducted in India. One patient was enrolled on February 16, 2022, at Medanta Medicity Hospital, Gurugram, Haryana 12200, India.
The patient tolerated one HP treatment daily for three days. On February 19, 2022, in the first 15 min during the 3rd treatment, one nonserious
Grade 2 AE was reported (hemolysis and leaking of the filter). The filter was replaced, and therapy resumed without sequelae. On Day #4
the patient suffered asystole and died due to clinical deterioration unrelated to the device. During the first Hemopurifier treatment
(T1) there was a gradual decrease in viral load from the baseline at 4923 copies/mL decreasing steadily to 1307 copies/mL over five hours,
indicating a 73% reduction from baseline. At the beginning of the second Hemopurifier treatment (T2), the viral load was 850 copies/mL,
dropped below the lower limit of quantification within an hour, and remained undetectable, suggesting rapid clearance. The viral load
before the third treatment (T3) was below the quantification limit but unexpectedly rose at 3 hours (636 copies/mL), peaking at 4 hours
(1583 copies/mL), and slightly decreasing at 5 hours (1104 copies/mL). This irregular pattern suggests possible delayed RNA release, sample
variability, or another biological factor affecting detection. The cumulative data shows a reduced SARs-CoV-2 viral load during the first
two Hemopurifier treatments but not during the third treatment.
Due to lack of eligible patients
in the ICU the clinical trial was closed on November 22, 2022.
Oncology- U.S. Clinical Trial in Head and Neck
Cancer
A single center clinical trial
entitled “Depleting Exosomes to Improve Response to Immune Therapy in Head and Neck Squamous Cell Cancer: An Early Feasibility Phase
I Clinical Trial” was conducted under a US IDE at the University of Pittsburgh. This was a single arm Phase 1 clinical trial designed
to evaluate the safety and efficacy of the Hemopurifier plus pembrolizumab for the treatment of patients with recurrent or metastatic
head and neck squamous cell cancer. All patients were treated with pembrolizumab every 21 days as standard of care. The patients were
to receive a 4-hour Hemopurifier treatment before Pembrolizumab infusions 2 occasions 21 days apart. A total of 2 patients were enrolled
in the study with the first occurring on Dec 14, 2020. The first patients received 2 HP treatments, and the second patient received one
HP treatment. The second treatment in the second patient was terminated due to operator error.
The only exploratory efficacy
laboratory analysis that was performed in this study was a determination of the total nanoparticle concentrations in the 1st patient prior
to and for 14 days after the second HP treatment. Total nanoparticle concentrations decreased following each Hemopurifier treatment. Following
Hemopurifier treatment, the total nanoparticle concentrations rose by about Day 7 but did not reach the baseline levels. Exosomes levels
are a component of the total nanoparticle concentration but exosome levels over time were not specifically determined.
Research and Development Costs
A substantial portion of our operating
budget is used for research and development activities. The cost of research and development, all of which has been charged to operations,
amounted to approximately $1,912,000 and $2,212,000 in the fiscal years ended March 31, 2026 and 2025, respectively.
Recent Developments
Subsequent
to March 31, 2026, the Company sold an aggregate of 800,111 shares of common stock under its ATM facility, resulting in gross proceeds
of approximately $1,904,000. Net proceeds, after sales commissions of approximately $48,000 and SEC, settlement and delivery fees of
approximately $6,000, were approximately $1,851,000. The Company has not reflected additional offering-related costs, including legal
and accounting fees, in the net proceeds amount, as such costs will be recorded as a reduction of additional paid-in capital upon final
determination. The Company intends to use the proceeds
for working capital and general corporate purposes, including clinical development activities and research and development.
On June 4, 2026, the Company filed
Amendment No. 1 to its prospectus supplement relating to its at-the-market offering program. The amendment updated the amount of securities
eligible for sale pursuant to General Instruction I.B.6 of Form S-3. Following the filing of the amendment, the Company may offer and
sell shares of its common stock having an aggregate offering price of up to approximately $542,716 pursuant to its ATM facility.
Intellectual Property
We rely on a combination of patents,
trade secrets, know-how, trademarks, and confidentiality agreements to protect our proprietary technologies, including the Hemopurifier
platform. As of March 31, 2026, we owned or exclusively licensed a portfolio of approximately 19 issued patents and approximately 18 pending
patent applications worldwide, including the United States, certain European jurisdictions, Canada, Australia, Japan, India. The issued
patents include European patents granted by the European Patent Office that are pending validation in designated jurisdictions. Our patent
portfolio relates primarily to extracorporeal removal technologies, viral and exosome-related applications, and related therapeutic methods.
We also maintain trademark registrations
for Hemopurifier and Aethlon Medical in the United States, trademark protection for Hemopurifier in India, and international trademark
protection for SANSAGITTA in multiple jurisdictions, including Australia, Canada, the European Union, the United Kingdom, and India.
We also use the marks Aethlon ADAPTTM and ELLSATM in connection with our business and development activities.
Industry & Competition
The industry for treating infectious
disease and cancer is extremely competitive, and companies developing new treatment procedures face significant capital and regulatory
challenges. As our Hemopurifier is a clinical-stage device, we have the additional challenge of establishing medical industry support,
which will be driven by treatment data resulting from human clinical studies. Should our device become market cleared by the FDA or the
regulatory body of another country, we may face significant competition from well-funded pharmaceutical organizations. Additionally, we
would likely need to establish large-scale production of our device in order to be competitive. Our competitors include blood filters
produced by ExThera Medical Corporation.
Government Regulation
The Hemopurifier is subject to
regulation by numerous regulatory bodies, primarily the FDA, and comparable international regulatory agencies. These agencies require
manufacturers of medical devices to comply with applicable laws and regulations governing the development, testing, manufacturing, labeling,
marketing, storage, distribution, advertising and promotion, and post-marketing surveillance reporting of medical devices. As the primary
mode of action of the Hemopurifier is attributable to the device component of this combination product, the CDRH has primary jurisdiction
over its premarket development, review and approval. Failure to comply with applicable requirements may subject a device and/or its manufacturer
to a variety of administrative sanctions, such as issuance of warning letters, import detentions, civil monetary penalties and/or judicial
sanctions, such as product seizures, injunctions and criminal prosecution.
FDA’s Pre-market Clearance and Approval
Requirements
Each medical device we seek to
commercially distribute in the United States will require either a prior 510(k) clearance, unless it is exempt, or a pre-market approval
from the FDA. Generally, if a new device has a predicate that is already on the market under a 510(k) clearance, the FDA will allow that
new device to be marketed under a 510(k) clearance; otherwise, a premarket approval, or PMA, is required. Medical devices are classified
into one of three classes—Class I, Class II or Class III—depending on the degree of risk associated with each
medical device and the extent of control needed to provide reasonable assurance of safety and effectiveness. Class I devices are
deemed to be low risk and are subject to the general controls of the Federal Food, Drug and Cosmetic Act, such as provisions that relate
to: adulteration; misbranding; registration and listing; notification, including repair, replacement, or refund; records and reports;
and good manufacturing practices. Most Class I devices are classified as exempt from pre-market notification under section 510(k)
of the FD&C Act, and therefore may be commercially distributed without obtaining 510(k) clearance from the FDA. Class II devices
are subject to both general controls and special controls to provide reasonable assurance of safety and effectiveness. Special controls
include performance standards, post market surveillance, patient registries and guidance documents. A manufacturer may be required to
submit to the FDA a pre-market notification requesting permission to commercially distribute some Class II devices. Devices deemed
by the FDA to pose the greatest risk, such as life-sustaining, life-supporting or implantable devices, or devices deemed not substantially
equivalent to a previously cleared 510(k) device, are placed in Class III. A Class III device cannot be marketed in the United
States unless the FDA approves the device after submission of a PMA. However, there are some Class III devices for which FDA has
not yet called for a PMA. For these devices, the manufacturer must submit a pre-market notification and obtain 510(k) clearance in orders
to commercially distribute these devices. The FDA can also impose sales, marketing or other restrictions on devices in order to assure
that they are used in a safe and effective manner. We believe that the Hemopurifier will be classified as a Class III device and as such
will be subject to PMA submission and approval.
Pre-market Approval Pathway
A pre-market approval application
must be submitted to the FDA for Class III devices for which the FDA has required a PMA. The pre-market approval application process
is much more demanding than the 510(k) pre-market notification process. A pre-market approval application must be supported by extensive
data, including but not limited to technical, preclinical, clinical trials, manufacturing and labeling to demonstrate to the FDA’s
satisfaction reasonable evidence of safety and effectiveness of the device.
After a pre-market approval application
is submitted, the FDA has 45 days to determine whether the application is sufficiently complete to permit a substantive review and thus
whether the FDA will file the application for review. The FDA has 180 days to review a filed pre-market approval application, although
the review of an application generally occurs over a significantly longer period and can take up to several years. During this review
period, the FDA may request additional information or clarification of the information already provided. Also, an advisory panel of experts
from outside the FDA may be convened to review and evaluate the application and provide recommendations to the FDA as to the approvability
of the device.
Although the FDA is not bound
by the advisory panel decision, the panel’s recommendations are important to the FDA’s overall decision-making process. In
addition, the FDA may conduct a preapproval inspection of the manufacturing facility to ensure compliance with the Quality System Regulation,
or QSR. The agency also may inspect one or more clinical sites to assure compliance with FDA’s regulations.
Upon completion of the PMA review,
the FDA may: (i) approve the PMA which authorizes commercial marketing with specific prescribing information for one or more indications,
which can be more limited than those originally sought; (ii) issue an approvable letter which indicates the FDA’s belief that
the PMA is approvable and states what additional information the FDA requires, or the post-approval commitments that must be agreed to
prior to approval; (iii) issue a not approvable letter which outlines steps required for approval, but which are typically more onerous
than those in an approvable letter, and may require additional clinical trials that are often expensive and time consuming and can delay
approval for months or even years; or (iv) deny the application. If the FDA issues an approvable or not approvable letter, the applicant
has 180 days to respond, after which the FDA’s review clock is reset.
Emergency Use Authorizations,
or EUAs, are granted by FDA in public health emergencies but allow use of the authorized device only during the period of the respective
public health emergency, and do not change the requirement to ultimately seek PMA approval after the authorization period has ended.
Clinical Trials
Clinical trials are almost always
required to support pre-market approval and are sometimes required for 510(k) clearance. In the United States, for significant risk devices,
these trials require submission of an application for an IDE to the FDA. The IDE application must be supported by appropriate data, such
as animal and laboratory testing results, showing it is safe to test the device in humans and that the testing protocol is scientifically
sound. The IDE must be approved in advance by the FDA for a specific number of patients at specified study sites. During the trial, the
sponsor must comply with the FDA’s IDE requirements for investigator selection, trial monitoring, reporting and recordkeeping. The
investigators must obtain patient informed consent, rigorously follow the investigational plan and study protocol, control the disposition
of investigational devices and comply with all reporting and recordkeeping requirements. Clinical trials for significant risk devices
may not begin until the IDE application is approved by the FDA and the appropriate institutional review boards, or IRBs, at the clinical
trial sites. An IRB is an appropriately constituted group that has been formally designated to review and monitor medical research involving
subjects and which has the authority to approve, require modifications in, or disapprove research to protect the rights, safety and welfare
of human research subjects. The FDA or the IRB at each site at which a clinical trial is being performed may withdraw approval of a clinical
trial at any time for various reasons, including a belief that the risks to study subjects outweigh the benefits or a failure to comply
with FDA or IRB requirements. Even if a trial is completed, the results of clinical testing may not demonstrate the safety and effectiveness
of the device, may be equivocal or may otherwise not be sufficient to obtain approval or clearance of the product.
Similar clinical investigations
for medical devices in Australia are regulated by the Therapeutic Goods Administration, or TGA, and are subject to applicable Australian
regulatory and ethics review requirements.
Ongoing Regulation by the FDA
Even after a device receives clearance or approval
and is placed on the market, numerous regulatory requirements apply. These include:
· establishment registration and device listing;
Some changes to an approved PMA
device, including changes in indications, labeling or manufacturing processes or facilities, require submission and FDA approval of a
new PMA or PMA supplement, as appropriate, before the change can be implemented. Supplements to a PMA often require the submission of
the same type of information required for an original PMA, except that the supplement is generally limited to that information needed
to support the proposed change from the device covered by the original PMA. The FDA uses the same procedures and actions in reviewing
PMA supplements as it does in reviewing original PMAs.
Failure by us or by our suppliers to comply with applicable regulatory requirements
can result in enforcement action by the FDA or state authorities, which may include any of the following sanctions:
· operating restrictions, partial suspension or total shutdown of production;
· withdrawing approvals that have already been granted; and
· criminal prosecution.
The Medical Device Reporting laws
and regulations require us to provide information to the FDA when we receive or otherwise become aware of information that reasonably
suggests our device may have caused or contributed to a death or serious injury as well as a device malfunction that likely would cause
or contribute to death or serious injury if the malfunction were to recur. In addition, the FDA prohibits an approved device from being
marketed for off-label use. The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label
uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability, including substantial
monetary penalties and criminal prosecution.
Newly discovered or developed
safety or effectiveness data may require changes to a product’s labeling, including the addition of new warnings and contraindications,
and may require the implementation of other risk management measures. Also, new government requirements, including those resulting from
new legislation, may be established, or the FDA’s policies may change, which could delay or prevent regulatory clearance or approval
of our products under development.
Healthcare Regulation
In addition to the FDA’s
restrictions on marketing of pharmaceutical products, the U.S. healthcare laws and regulations that may affect our ability to operate
include: the federal fraud and abuse laws, including the federal anti-kickback and false claims laws; federal data privacy and security
laws; and federal transparency laws related to payments and/or other transfers of value made to physicians (defined to include doctors,
dentists, optometrists, podiatrists and chiropractors) and other healthcare professionals (such as physicians assistants and nurse practitioners)
and teaching hospitals. Many states have similar laws and regulations that may differ from each other and federal law in significant ways,
thus complicating compliance efforts. For example, states have anti-kickback and false claims laws that may be broader in scope than analogous
federal laws and may apply regardless of payor. In addition, state data privacy laws that protect the security of health information may
differ from each other and may not be preempted by federal law. Moreover, several states have enacted legislation requiring pharmaceutical
manufacturers to, among other things, establish marketing compliance programs, file periodic reports with the state, make periodic public
disclosures on sales and marketing activities, report information related to drug pricing, require the registration of sales representatives,
and prohibit certain other sales and marketing practices. These laws may adversely affect our sales, marketing and other activities with
respect to any product candidate for which we receive approval to market in the United States by imposing administrative and compliance
burdens on us.
Because
of the breadth of these laws and the narrowness of available statutory exceptions and regulatory safe harbors, it is possible that some
of our business activities, particularly any sales and marketing activities after a product candidate has been approved for marketing
in the United States, could be subject to legal challenge and enforcement actions. In addition, healthcare reform measures and reimbursement
policies continue to evolve at the federal and state levels. Future legislation, regulations, or reimbursement policies adopted by governmental
or private payors may limit coverage, reimbursement, or payment levels for our products. If
our operations are found to be in violation of any of the federal and state laws described above or any other governmental regulations
that apply to us, we may be subject to significant civil, criminal, and administrative penalties, including, without limitation, damages,
fines, imprisonment, exclusion from participation in government healthcare programs, additional reporting obligations and oversight if
we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws, and
the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results
of operations.
Coverage and Reimbursement
In both the U.S. and international
markets, the use of medical devices is dependent in part on the availability of reimbursement from third-party payors, such as government
and private insurance plans. Healthcare providers that use medical devices generally rely on third-party payors to pay for all or part
of the costs and fees associated with the medical procedures being performed or to compensate them for their patient care services. Should
our Hemopurifier or any other products under development be approved for commercialization by the FDA, any such products may not be considered
cost-effective, reimbursement may not be available in the United States or other countries, if approved, and reimbursement may not be
sufficient to allow sales of our future products on a profitable basis. The coverage decisions of third-party payors will be significantly
influenced by the assessment of our future products by health technology assessment bodies. If approved for use in the United States,
we expect that any products that we develop, including the Hemopurifier, will be purchased primarily by medical institutions, which will
in turn bill various third-party payors for the health care services provided to patients at their facility. Payors may include the Centers
for Medicare & Medicaid Services, or CMS, which administers the Medicare program and works in partnership with state governments to
administer Medicaid, other government programs and private insurance plans. The process involved in applying for coverage and reimbursement
from CMS is lengthy and expensive. Further, Medicare coverage is based on our ability to demonstrate that the treatment is “reasonable
and necessary” for Medicare beneficiaries. Even if products utilizing our Hemopurifier technology receive FDA and other regulatory
clearance or approval, they may not be granted coverage and reimbursement by any payor, including by CMS. Many private payors use coverage
decisions and payment amounts determined by CMS as guidelines in setting their coverage and reimbursement policies and amounts. However,
no uniform policy for coverage and reimbursement for medical devices exists among third-party payors in the United States. Therefore,
coverage and reimbursement can differ significantly from payor to payor.
Manufacturing
Historically, manufacturing of
our Hemopurifier was conducted in collaboration with a contract manufacturer based in California, operating under current Good Manufacturing
Practice, or cGMP, regulations promulgated by the FDA. Our contract manufacturer is registered with the FDA. To date, production
of the Hemopurifier has been limited to quantities necessary to support our clinical studies.
In May 2024, the FDA approved
the use of our own manufacturing for the production of Hemopurifiers. We have since initiated manufacturing activities at our facility
under cGMP conditions to support ongoing and planned clinical development.
Our costs of compliance with federal, state and local
environmental laws have been immaterial to date.
Sources and Availability of Raw Materials and the Names of
Principal Suppliers
Aethlon personnel assemble the
various components of the Hemopurifier with materials from our various suppliers, which are purchased and released by Aethlon. Specifically,
the Hemopurifier contains three critical components with limited available suppliers. The GNA lectin is sourced from Vector Laboratories
Inc. and also is available from other suppliers. Our intended transition from Vector Laboratories to a new supplier for GNA is delayed
as we work with the FDA for approval of our supplement to our IDE, which is required to make this manufacturing change. The base cartridge
on which the Hemopurifier is constructed is sourced from Medica S.p.A. and we are dependent on the continued availability of these cartridges.
Although there are other suppliers, the process of qualifying a new supplier takes time and regulatory approvals must be obtained. We
currently purchase the diatomaceous earth from Janus Scientific, Inc., as the distributor; however, the product is manufactured by Imerys
Minerals Ltd. There potentially are other suppliers of this product, but as with the cartridges, qualifying and obtaining required regulatory
approvals takes time and resources.
Sales and Marketing
We do not currently have any sales
and marketing capability. With respect to commercialization efforts in the future, we intend to build or contract for distribution, sales
and marketing capabilities for any product candidate that is approved. From time to time, we have had and are having strategic discussions
with potential collaboration partners for our product candidates, although no assurance can be given that we will be able to enter into
one or more collaboration agreements for our product candidates on acceptable terms, if at all.
Product Liability
The risk of product liability
claims, product recalls and associated adverse publicity is inherent in the testing, manufacturing, marketing and sale of medical products.
We have limited clinical trial liability insurance coverage. It is possible that future insurance coverage may not be adequate or available.
We may not be able to secure product liability insurance coverage on acceptable terms or at reasonable costs when needed. Any liability
for mandatory damages could exceed the amount of our coverage. A successful product liability claim against us could require us to pay
a substantial monetary award. Moreover, a product recall could generate substantial negative publicity about our products and business
and inhibit or prevent commercialization of other future product candidates.
Employees
As of June 8, 2026, we had 9 full-time
employees and no part-time employees. All of our employees are located in the United States. We may hire additional employees as business
needs and available resources warrant. We utilize, whenever appropriate, consultants in order to conserve cash and resources.
We believe our employee relations
are good. None of our employees are represented by a labor union or are subject to collective-bargaining agreements.
ITEM 1A. RISK FACTORS
An investment in our securities
involves a high degree of risk. You should carefully consider the risks described below as well as the other information in this Annual
Report before deciding to invest in or maintain your investment in our company. The risks described below are not intended to be an all-inclusive
list of all of the potential risks relating to an investment in our securities. Any of the risk factors described below could significantly
and adversely affect our business, prospects, financial condition and results of operations. Additional risks and uncertainties not currently
known or that are currently considered to be immaterial may also materially and adversely affect our business. As a result, the trading
price or value of our securities could be materially adversely affected and you may lose all or part of your investment.
Risks Relating to Our Financial Position and Need for Additional Capital
We have incurred significant losses and expect to continue to incur
losses for the foreseeable future.
We have never been profitable.
We did not generate any revenue during the fiscal years ended March 31, 2026 and March 31, 2025. In prior fiscal years we recorded revenue
from government contracts, however, we do not currently have any research grants or contracts. It is possible that we may not be able
to enter into future government contracts. Future profitability, if any, will require the successful commercialization of our Hemopurifier