Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Prospective investors should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this annual report. Some of the information contained in this discussion and analysis or set forth elsewhere in this annual report, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. See “Cautionary Note Regarding Forward-Looking Statements.” This discussion should be read in conjunction with our audited consolidated financial statements and the notes thereto included elsewhere in this report. In this discussion, we may use certain non-generally accepted accounting principles (GAAP) financial measures. An explanation of these non-GAAP financial measures and a reconciliation to the most directly comparable GAAP financial measures are included in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Investors should not consider non-GAAP financial measures in isolation or as substitutes for financial information presented in compliance with GAAP.

1. Overview

We are a specialty pharmaceutical company with a goal of using cutting-edge biological science and applied research to further develop and commercialize new therapies for the prevention and treatment of infectious diseases. We have successfully achieved regulatory approval of Arakoda® (“Arakoda”), a malaria preventative treatment that has been on the market since late 2019. Currently, 60P’s pipeline under development covers development programs for vector-borne, fungal, and viral diseases utilizing three of the Company’s future products: (i) new products that contain the Arakoda regimen of Tafenoquine; (ii) new products that contain Tafenoquine; and (iii) Celgosivirand/or botanical extracts from Australian Chestnut Trees.

2. Components of Results of Operations

Product Revenues - net of Discounts and Rebates

We receive the majority of our product revenues from sales of our Arakoda product to resellers in the U.S. and abroad. Foreign sales to both Australia and Europe were further subject to profit sharing agreements for boxes sold to customers. Sales to resellers in the US are subject to considerable discounts and rebates for services provided by our third-party logistics (“3PL”) partner and wholesalers and pharmacy benefit managers (“PBMs”).

Cost of Revenues, Gross Profit, and Gross Margin

Cost of revenues associated with our products is primarily comprised of direct materials, shipping, manufacturing related costs incurred in the production process, serialization costs and inventory write-downs due to expiration.

Other Operating Revenues

Other operating revenues for the periods presented include research revenue earned from the Australian Tax Authority for research activities conducted in Australia. Beginning in the third quarter of 2024, we began to recognize research revenues associated with our new contract with the United States Army Medical Materiel Development Activity (USAMMDA) for Arakoda supply chain upgrade support. Research revenue under this contract is recognized when we incur the direct costs eligible for reimbursement, up to the maximum allowable amount.

Operating Expenses

Research and Development

Research and development costs for the periods presented primarily consist of contracted R&D services and costs associated with preparation for and conducting our Babesiosis trial. We expense all research and development costs in the period in which they are incurred. Payments made prior to the receipt of goods or services to be used in research and development are recognized as prepaid assets and expensed over the service period as the services are provided. We have also issued shares of our common stock to vendors in exchange for research and development services

General and Administrative Expenses

Our general and administrative expenses primarily consist of salaries, advertising and promotion expenses, professional services fees, such as consulting, audit, accounting and legal fees, general corporate costs and allocated costs, including facilities, information technology and amortization of intangibles.

Interest and Other Income (Expense), Net

We earn interest income from cash invested in interest-bearing accounts, as well as cash equivalents and short-term investments consisting of certificates of deposits with original maturities ranging from three to six months. Interest expense for the periods presented is limited to a single $150,000 SBA loan that bears interest at 3.75%. Other components of other income (expense) include changes in the fair value of derivative liabilities and other miscellaneous income or expenses.

3. Results of Operations

The following table sets forth our results of operations for the periods presented:

For the Year Ended December 31,

Consolidated Statements of Operations Data: 2025 2024

Product Revenues – net of Discounts and Rebates $ 1,005,471 $ 607,574

Operating Expenses:

Loss from Operations before Provision for Income Taxes (7,368,325) (7,955,663)

Provision for Income Taxes (Note 9) - -

Net Loss – Noncontrolling Interest (3,167) (8,556)

The following table sets forth our results of operations as a percentage of revenue:

For the Year Ended December 31,

Consolidated Statements of Operations Data: 2025 2024

Product Revenues – net of Discounts and Rebates 100.00 % 100.00 %

Operating Expenses:

Change in Fair Value of Derivative Liabilities 26.46 274.20

Total Interest and Other Income (Expense), net 38.81 289.60

Loss from Operations before Provision for Income Taxes (732.82) (1,309.41)

Provision for Income Taxes (Note 9) - -

Net Loss including Noncontrolling Interest (732.82) (1,309.41)

Net Loss – Noncontrolling Interest (0.31) (1.41)

4. Comparison of the Years Ended December 31, 2025, and 2024

Product Revenues - net of Discounts and Rebates, Cost of Revenues, Gross Profit, and Gross Margin

For the Year Ended December 31,

Consolidated Statements of Operations Data: 2025 2024 $ Change % Change

Product Revenues - net of Discounts and Rebates

Our product revenues - net of discounts and rebates were $1,005,471 for the year ended December 31, 2025, as compared to $607,574 for the year ended December 31, 2024. For the year ended December 31, 2025, our U.S. pharmaceutical distributor accounted for 92% of our total net product sales and Kodatef sales to our Australian distributor accounted for 6% of total net product sales (95% and 5% for the year ended December 31, 2024, respectively). Despite a shortage of Arakoda 16-ct boxes starting in April 2025, which resulted from a delay in completing commercial validation of a new packaging format, domestic, commercial product sales increased during the period, primarily due to the combination of rising sales, price increases and fewer returns.

We offer discounts and rebates to the civilian U.S. supply chain distribution channel. We record sales when our 3PL partner transfers boxes into their title model. Discounts and rebates offered to our 3PL partner amount to 12% (lower rates available upon reaching larger revenue tiers) along with a $5,500 fixed monthly fee. The product is then transferred usually to one of the three large U.S. pharmaceutical distributors where rebates are 10%. Lastly, we have relationships with several large pharmacy benefit managers (“PBMs”) that allow patients to purchase Arakoda at a discount. The rebate associated with PBMs ranges from 30% to 41.25% depending on the amount of coverage provided. For the year ended December 31, 2025, discounts and rebates were $476,430 compared to $476,218 for the year ended December 31, 2024.

Arakoda entered the U.S. civilian supply chain in the third quarter of 2019. Since the introduction of the new 8-ct bottle in June 2025, we will be reporting Arakoda unit sales in terms of 16-ct box equivalents. For the year ended December 31, 2024, 5,119 16-ct box equivalents were sold to pharmacies and dispensaries. Sales volume increased by 12% to 5,724 16-ct box equivalents sold to pharmacies and dispensaries for the year ended December 31, 2025.

Kodatef sales to our distributor Biocelect in Australia for the year ended December 31, 2025 were $57,058 ($30,652 for the year ended December 31, 2024). A historical portion of sales to Biocelect remained subject to a profit share distribution once the original transfer price has been recouped. As of December 31, 2025, Biocelect has no inventory left that remains subject to profit share. Biocelect, which acts as a distributor in the Australian and New Zealand markets, reported year-over-year growth of <1%, with 1,854 boxes sold for the year ended December 31, 2025, compared to 1,850 boxes for the year ended December 31, 2024. Additionally, under a new agreement executed during 2025, Biocelect began to purchase from the latest manufactured lot of Kodatef at $49.50 AUD per box which are not subject to historical profit share. As of December 31, 2025, no receivables were due to us ($9,444 as of December 31, 2024).

Arakoda sales volume in Europe continues to grow. We first shipped Arakoda to our distributor Scandinavian Biopharma (“SB”) in September 2022. For the year ended December 31, 2025, SB reported 353 boxes sold (147 for the year ended December 31, 2024). According to our distributor, this is due to greater interest in treating babesiosis.Additionally, we recorded $22,500 in European sales for the year ended December 31, 2025 ($0 for the year ended December 31, 2024).

Cost of Revenues, Gross Profit, and Gross Margin

Cost of revenues was $781,695 for the year ended December 31, 2025, as compared to $384,765 for the year ended December 31, 2024. The increase in cost of revenues was, in part, due to higher product sales during the year, as well as higher write-offs of inventory not expected to be sold prior to its expiration date. Write-offs for expiring inventory were $445,181 during the year ended December 31, 2025, as compared to $22,046 during the year ended December 31, 2024. The excess inventory resulted from our strategic decision to validate a new, larger-scale production method with then soon to be expiring raw materials (API), with the offsetting assistance from our USAMMDA grant. The development proved successful but the dating on the produced inventory is already considered in the industry to be short-dated and will have to be replaced by the beginning of the second quarter of 2026. The temporary increase in inventory write-offs was a necessary step in scaling our operations and is not expected to be recurring. Our new larger-scale production processes are expected to help keep inventory costs lower than otherwise. Due to these factors, the Gross Margin % decreased from 36.67% for the year ended December 31, 2024 to 22.26% for the year ended December 31, 2025.

Other Operating Revenues

For the Year Ended December 31,

Consolidated Statements of Operations Data: 2025 2024 $ Change % Change

The research revenues earned by us were $403,624 for the year ended December 31, 2025, as compared to $73,771 for the year ended December 31, 2024. The increase in research revenues is due to the new USAMMDA contract we were awarded in July 2024 to facilitate commercial validation of a new bottle and replacement blister packaging of Arakoda and the contract we signed with the University of

Kentucky for tafenoquine clinical trial supply. We recognized research revenues of $298,868 related to the USAMMDA grant for the year ended December 31, 2025 ($12,994 for the year ended December 31, 2024). We recognized research revenues of $89,302 from the University of Kentucky for the year ended December 31, 2025 ($0 for the year ended December 31, 2024). Other research revenues were $15,454 for the year ended December 31, 2025 ($60,777 for the year ended December 31, 2024).

Operating Expenses

For the Year Ended December 31,

Consolidated Statements of Operations Data: 2025 2024 $ Change % Change

Research and Development

Research and development costs decreased by $2,880,370 during the year ended December 31, 2025 when compared to the year ended December 31, 2024. The decline is primarily attributable to non-cash charges totaling $3,225,000 recognized during the year ended December 31, 2024 related to share-based payments issued to vendors in January 2023 as advance consideration, which payments were initially deferred and capitalized. Kentucky Technology, Inc. delivered us a report on the potential development of SJ733 + tafenoquine in the second quarter of 2024 and Trevally completed the synthesis of 8.8 kilograms of castanospermine in the third quarter of 2024, resulting in $2,625,000 and $600,000, respectively, of research and development expense recognized for the year ended December 31, 2024. Otherwise, research and development costs incurred during the years ended December 31, 2025 and 2024 primarily consisted of costs related to our babesiosis trial for tafenoquine. Direct trial-related costs represent 71% of the total research and development costs at $1,496,148 during the year ended December 31, 2025, compared to 27% of the costs at $1,359,532 during the year ended December 31, 2024. We also recorded $153,198 in research and development expenses related to commercial validation and packaging of Arakoda, for which a majority qualifies for reimbursement under the USAMMDA grant discussed above.

General and Administrative Expenses

For the year ended December 31, 2025, our general and administrative expenses increased by 24.97% or $1,254,588 from the year ended December 31, 2024. During the year ended December 31, 2025, we recorded lower compensation expenses including $11,791 of bonus expense and $728,829 of salaries, taxes, and benefits expense, respectively (compared to $275,114 and $662,951 for the year ended December 31, 2024, respectively) due to certain sales and performance bonuses awarded to our executives in 2024. However, during the year ended December 31, 2025, we incurred $518,150 in legal and professional fees, $1,217,826 of investor outreach expenses, and $1,401,529 of sales advisory, advertising and promotion expenses (up from $410,016, $1,019,111, and $433,884 for the year ended December 31, 2024, respectively). Additionally, we recognized higher stock-based compensation costs, from $32,767 for the year ended December 31, 2024 to $279,873 for the year ended December 31, 2025. This increase was in part due to new partially vested option grants awarded to two executives in January 2025 and certain fully vested stock-based awards granted to our directors at the end of 2025, as well as the ongoing quarterly expense recognized for additional stock options granted in the third quarter of 2024.

Interest and Other Income (Expense), Net

For the Year Ended December 31,

Consolidated Statements of Operations Data: 2025 2024 $ Change % Change

Interest Expense

For the year ended December 31, 2025, we recognized $7,805 of interest expense ($7,912 for the year ended December 31, 2024). Our interest expense for the periods presented relates primarily to our single outstanding loan from the SBA. Cash paid for interest was $8,772 and $8,772 for the years ended December 31, 2025 and December 31, 2024, respectively.

Change in Fair Value of Derivative Liabilities

For the year ended December 31, 2025, we recognized a net gain on the change in fair value of derivative liabilities of $266,089 compared to a net gain of $1,665,966 for the year ended December 31, 2024. During the years ended December 31, 2025 and December 31, 2024, derivative liabilities include the contingent milestone payment due to Knight upon a future sale of Arakoda or a Change of Control. We use a probability-weighted expected return method to estimate the fair value of this derivative liability.

Other Income (Expense), net

For the year ended December 31, 2025, we recognized $131,970 in other income compared to $101,464 in other income for the year ended December 31, 2024. We recognized interest income of $104,360 during the year ended December 31, 2025 ($103,299 during the year ended December 31, 2024). Other income for the year ended December 31, 2024also included $10,789 of storage revenue recognized in association with final payment under the legacy contract with the USAMMDA for storing Arakoda purchases. We did not recognize storage revenue for the year ended December 31, 2025.

5. Liquidity and Capital Resources

As of December 31, 2025, we had cash and cash equivalents of $1,510,065 ($1,659,353 as of December 31, 2024). For the year ended December 31, 2025 and 2024, our net cash used in operating activities was $6,849,022 and $5,648,088, respectively. To date, we have financed our operations primarily through the issuance of common stock, warrants to purchase common stock, and proceeds from the issuance of convertible debt and promissory notes. Based on current internal projections, taking into consideration the net proceeds of approximately $4.3 million received from the July 2025 public offering, and approximately $4.0 million in gross proceeds received through the 2025 ATM Agreement between October 15, 2026 and March 25, 2026, we estimate that we will have sufficient funds to remain viable through September 30, 2026, assuming no additional capital raises. We cannot give assurance that we can increase our cash balances or limit our cash consumption and thus maintain sufficient cash balances for our planned operations or future acquisitions. Future business demands may lead to cash utilization at levels greater than recently experienced. We may need to raise additional capital in the future. However, we cannot assure you that we will be able to raise additional capital on acceptable terms, or at all.

Going Concern

In their audit report for the fiscal year ended December 31, 2025, our auditors have expressed their concern as to our ability to continue as a going concern. Our ability to continue as a going concern is dependent upon our ability to generate cash flows from operations and obtain financing. The audited consolidated financial statements for the years ended December 31, 2025, and December 31, 2024, respectively, included an explanatory note referring to our recurring operating losses and expressing substantial doubt in our ability to continue as a going concern.

Our future results are subject to substantial risks and uncertainties. Since our inception, we have not demonstrated the ability to generate enough revenues to date to cover operating expenses and we have accumulated losses to date. To date, we have funded our operations primarily with proceeds from sales of common stock and warrants for the purchase of common stock, sales of preferred stock, proceeds from the issuance of convertible debt and borrowings under loan and security agreements.

Continuation as a going concern is dependent upon our ability to meet our financial requirements, raise additional capital, and achieve gross profitability from our single marketed product. To achieve profitability, we expect we will need to raise additional capital to fund our activities relating to commercial support for our existing product and any future clinical research trials and operating activities. However, there can be no assurance that we will ever achieve or maintain profitability. These conditions, among others, raise substantial doubt about our ability to continue as a going concern for one year from the date these financial statements are issued.

We plan to fund our operations through third party and related party debt/advances, private placement of restricted securities and the issuance of stock in a subsequent offering until such a time as the business achieves profitability or a business combination may be achieved. However, there can be no assurance that we will be successful in raising additional capital or that such capital, if available, will be on terms that are favorable to us. Debt financing and equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise funds through collaborations, or other similar arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us and/or may reduce the value of our common stock. If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market our product candidates even if we would otherwise prefer to develop and market such product candidates ourselves.

As such, we have concluded that such plans do not alleviate the substantial doubt about our ability to continue as a going concern for one year from the date the accompanying financial statements are issued.

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of obligations in the normal course of business, and do not include any adjustments to the amount and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern.

Contractual Obligations

The following table summarizes our contractual obligations as of December 31, 2025:

Payments Due By Period

Total Less than 1 year 1-3 years 4-5 years More than 5 Years

Amounts related to contingent milestone payments are not considered contractual obligations as they are contingent on the achievement of certain milestones. These contingent milestones may or may not be achieved. We have not included any of these amounts in the table above as we cannot estimate or predict when, or if, these amounts will become due.

Cash Flows

Year Ended December 31,

Net Cash (Used In) Provided By :

Cash Used in Operating Activities

Net cash used in operating activities was $6,849,022 for the year ended December 31, 2025, as compared to $5,648,088 for the year ended December 31, 2024. Our net cash used in operating activities increased, in part due to higher general and administrative expenses of $6,279,823 for the year ended December 31, 2025 ($5,025,235 for the year ended December 31, 2024) primarily due to higher cash compensation and related expenses, legal and professional fees, investor outreach expenses, and advertising and promotion expenses, as discussed above. In addition, we incurred $1,496,148 in costs related to our babesiosis trial for tafenoquine during the year ended December 31, 2025 ($1,304,183 during the year ended December 31, 2024).

Cash Provided by (Used in) Investing Activities

Net cash provided by investing activities was $254,916 for the year ended December 31, 2025, as compared to cash used in investing activities of $1,889,114 for the year ended December 31, 2024. The decrease in cash used in investing activities is primarily driven by purchases of short-term certificates of deposit for a total cost of $1,235,000 during the year ended December 31, 2025 ($1,708,000 during the year ended December 31, 2024), purchased for the purposes of earning interest income. Additionally, purchases of computer and lab equipment totaled $139,881 during the year ended December 31, 2025 ($103,773 during the year ended December 31, 2024), and capitalized website development costs and patent costs totaled $22,670 and $55,533, respectively, for the year ended December 31, 2025 ($25,374 and $51,967 for the year ended December 31, 2024, respectively).

Cash Provided by Financing Activities

Net cash provided by financing activities was $6,437,691 for the year ended December 31, 2025, as compared to $7,053,571 for the year ended December 31, 2024. The decrease in net cash provided by financing activities is primarily attributable to net proceeds aggregating to $7,042,608 received in connection with our common stock and warrant offering in January 2024, (ii) the sale of common stock pursuant to the At-the-Market Sales Agreement in July and August 2024, and (iii) the sale of warrants in our Private Placement offering that closed in September 2024, which exceeded the aggregate net proceeds of $6,452,887 received in connection with our common stock and warrant offerings completed in January, February, and July 2025 and the sale of common stock pursuant to the At-the-Market Sales Agreement in October and December 2025.

We also received lower proceeds from the exercise of warrants at $2,804 for the year ended December 31, 2025, compared to $10,963 for the year ended December 31, 2024. Additionally, for the year ended December 31, 2025, we withheld shares valued at $18,000 to cover tax withholdings for net share settlement of certain 2024 performance bonuses awarded to our executives ($0 for the year ended December 31, 2024).

Effect of Foreign Currency Translation on Cash Flow

Our foreign operations were small relative to U.S. operations for the years ended December 31, 2025 and December 31, 2024, thus effects of foreign currency translation have been minor.

6. Critical Accounting Policies, Significant Judgments, and Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition

We recognize revenue in accordance with FASB ASC Topic No. 606, Revenue from Contracts with Customers (“ASC 606”). Revenues are recognized when control is transferred to customers in amounts that reflect the consideration we expect to be entitled to receive in exchange for those goods. Revenue recognition is evaluated through the following five steps: (i) identification of the contract, or contracts, with a customer; (ii) identification of the performance obligations in the contract; (iii) determination of the transaction price; (iv) allocation of the transaction price to the performance obligations in the contract; and (v) recognition of revenue when or as a performance obligation is satisfied. As part of the accounting for these arrangements, we may be required to make significant judgments, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each performance obligation.

Revenues from product sales are recorded at the net sales price, or “transaction price,” which may include estimates of variable consideration that result from product returns. We determine the amount of variable consideration by using either the expected value method or the most-likely-amount method. We include the unconstrained amount of estimated variable consideration in the transaction price, which reflects the amount for which it is probable that a significant reversal of cumulative revenue recognized will not occur. At the end of each subsequent reporting period, we re-evaluate the estimated variable consideration included in the transaction price and any related constraint, and if necessary, adjust our estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis in the period of adjustment. Reserves are established for the estimates of variable consideration based on the amounts we expect to be earned or to be claimed on the related sales.

We record U.S. commercial revenues as a receivable when our American distributor transfers shipped product to their title model for 60P. Foreign sales to both Australia and Europe are recognized as a receivable at the point product is shipped to distributor. The shipments to Australia and Europe were further subject to profit sharing agreements for boxes sold to customers.

Inventory

We report inventories at the lower of cost or net realizable value. Cost is comprised of direct materials and, where applicable, costs we incur in bringing the inventories to their present location and condition. We use the Specific Identification method per lot. A box or a bottle price is calculated per lot number and sales are recognized by their lot number.

We regularly monitor our inventory levels to identify inventory that may expire or has a cost basis in excess of its estimated realizable value, and record write-downs for inventory that has expired, inventory that has a cost basis in excess of its expected net realizable value, and inventory in excess of expected sales requirements. We charge any write-downs of inventories to Cost of Revenues in the Consolidated Statements of Operations and Comprehensive Loss.

Share-Based Payments

We account for share-based payments in accordance with ASC Subtopic 718, Compensation - Stock Compensation (“ASC 718”). We measure compensation for all share-based payment awards granted to employees, directors, and nonemployees, based on the estimated fair value of the awards on the date of grant. For awards that vest based on continued service, the service-based compensation cost is recognized on a straight-line basis over the requisite service period, which is generally the vesting period of the awards. For service vesting awards with compensation expense recognized on a straight-line basis, at no point in time does the cumulative grant date value of vested awards exceed the cumulative amount of compensation expense recognized. The grant date is determined based on the date when a mutual understanding of the key terms of the share-based awards is established. We account for forfeitures as they occur.

We estimate the fair value of all stock option awards as of the grant date by applying the Black-Scholes option pricing model. The application of this valuation model involves assumptions, including the fair value of the common stock, expected volatility, risk-free interest rate, expected dividends and the expected term of the option. Due to the lack of a public market for our common stock prior to the IPO and lack of company-specific historical implied volatility data, we base our computations of expected volatility on the historical volatility of a representative group of public companies with similar characteristics of the Company, including stage of development and industry focus. The historical volatility is calculated based on a period of time commensurate with the expected term assumption. We generally use the simplified method as prescribed by the SEC Staff Accounting Bulletin Topic 14, Share-Based Payment, to estimate the expected term for stock options, whereby, the expected term equals the midpoint of the weighted average remaining time to vest, vesting period and the contractual term of the options due to our lack of historical exercise data. For certain options granted out-of-the-money, our best estimate of the expected term is the contractual term of the award. The risk-free interest rate is based on U.S. Treasury securities with a maturity date commensurate with the expected term of the associated award. The expected dividend yield is assumed to be zero as we have never paid dividends and have no current plans to pay any dividends on our common stock. The assumptions used in calculating the fair value of share-based awards represent our best estimates and involve inherent uncertainties and the application of significant judgment.

We recognize compensation expense for restricted stock units (“RSUs”) with only service-based vesting conditions on a straight-line basis over the vesting period. Compensation cost for service-based RSUs is based on the grant date fair value of the award, which is the closing market price of our common stock on the grant date multiplied by the number of shares awarded.

For awards that vest upon a liquidity event or a change in control, the performance condition is not probable of being achieved until the event occurs. As a result, no compensation expense is recognized until the performance-based vesting condition is achieved, at which time the cumulative compensation expense is recognized. Compensation cost related to any remaining time-based service for share-based awards after the liquidity-based event is recognized on a straight-line basis over the remaining service period.

For fully vested, nonforfeitable equity instruments that are granted at the date we enter into an agreement for goods or services with a nonemployee, we recognize the fair value of the equity instruments on the grant date. The corresponding cost is recognized as an immediate expense or a prepaid asset and expensed over the service period depending on the specific facts and circumstances of the agreement with the nonemployee.

Derivative Liabilities

We assess the classification of our derivative financial instruments each reporting period, which formerly consisted of bridge shares, convertible notes payable, and certain warrants, and determined that such instruments initially qualified for treatment as derivative liabilities as they met the criteria for liability classification under ASC 815. As of December 31, 2025, our derivative financial instruments consist of contingent payment arrangements.

We analyze all financial instruments with features of both liabilities and equity under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic No. 480, Distinguishing Liabilities from Equity (“ASC 480”), and FASB ASC Topic No. 815, Derivatives and Hedging (“ASC 815”). Derivative liabilities are adjusted to reflect fair value at each reporting period, with any increase or decrease in the fair value recorded in the results of operations, as a component of other income or expense as change in fair value of derivative liabilities. We use a Monte Carlo simulation model or a probability-weighted expected return method to determine the fair value of these instruments.

Upon conversion or repayment of a debt or equity instrument in exchange for equity shares, where the embedded conversion option has been bifurcated and accounted for as a derivative liability (generally convertible debt and warrants), we record the equity shares at fair value on the date of conversion, relieve all related debt, derivative liabilities, and unamortized debt discounts, and recognize a net gain or loss on debt extinguishment, if any.

Equity or liability instruments that become subject to reclassification under ASC Topic 815 are reclassified at the fair value of the instrument on the reclassification date.

Off-Balance Sheet Arrangements

During 2025 and 2024, we did not have any relationships with unconsolidated organizations or financial partnerships, such as structured finance or special purpose entities that would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

JOBS Act Accounting Election

In April 2012, the JOBS Act was enacted. Section 107(b) of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this exemption and, therefore, we will not be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

Recent Accounting Pronouncements

From time to time, the FASB issues Accounting Standards Update (“ASUs”) to amend the authoritative literature in the ASC. We regularly evaluate new ASUs to determine the impact that these pronouncements may have on our consolidated financial statements. Other than the pronouncements listed below, management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, or (iii) are not applicable to our consolidated financial statements or related disclosures.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”) which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses and segment profit or loss. ASU 2023-07 also requires entities with a single reportable segment to provide all segment disclosures under ASC 280, including the new required disclosures under the ASU. We adopted ASU 2023-07 on a retrospective basis for the 2024 annual period, and for interim periods beginning in 2025. The impact is limited to our financial statement disclosures, which are presented in Note 2 to the accompanying consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (ASC 740): Improvements to Income Tax Disclosures (“ASU 2023-09”) which requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. ASU 2023-09 was effective for us for our annual period ending December 31, 2025. The impact of the adoption is limited to our financial statement disclosures, which are presented on a prospective basis. See Note 9 to the accompanying consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), which applies to all public business entities that file financial statements with the SEC. The amendments in this ASU require public business entities to disclose on an annual and interim basis, disaggregated information about certain income statement expense line items. The new standard is effective for fiscal years beginning after December 15, 2026, with early adoption permitted. We are currently evaluating the impact that ASU 2024-03 will have on our financial statement disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”), which amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40. The amendments modernize the recognition and disclosure framework for internal-use software costs, removing the previous “development stage” model and introducing a more judgment-based approach. The ASU is effective for all entities for interim and annual periods beginning after December 15, 2027, with early adoption permitted. We are currently evaluating the impact that ASU 2025-06 will have on our consolidated financial statements.

In September 2025, the FASB issued ASU 2025-07, Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract (“ASU 2025-07”). ASU 2025-07 adds a new scope exception from derivative accounting under ASC 815 for certain non-exchange-traded contracts with customers with an underlying that is based on operations or activities specific to one of the parties to the contract. Further, ASU 2025-07 clarifies that an entity should apply the guidance in ASC 606 to a contract with stock-based noncash consideration. The ASU is effective for annual periods beginning after December 15, 2026 and interim periods within those annual periods, with early adoption permitted. We are currently evaluating the impact that ASU 2025-06 will have on our consolidated financial statements.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

We qualify as a smaller reporting company, as defined by SEC Rule 229.10(f)(1) and are not required to provide the information required by this Item.

Item 8. Financial Statements and Supplementary Data.

INDEX TO FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm F-2

Audited Consolidated Balance Sheets at December 31, 2025 and 2024 F-3

Notes to Audited Consolidated Financial Statements F-8

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

60 Degrees Pharmaceuticals, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of 60 Degrees Pharmaceuticals, Inc. and subsidiary (“the Company”) as of December 31, 2025 and 2024, and the related statements of operations and comprehensive loss, shareholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2025, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

The Company’s Ability to Continue as a Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has an accumulated deficit, recurring losses and expects future losses that raise substantial doubt about the Company’s ability to continue as a going concern. Management’s evaluation of the events and conditions and management’s plans regarding these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ RBSM LLP

PCAOB ID Number 587 We have served as the Company’s auditor since 2022.

Las Vegas, Nevada

F-2

60 DEGREES PHARMACEUTICALS, INC.

CONSOLIDATED BALANCE SHEETS

December 31, December 31,

ASSETS:

Current Assets:

Other Assets:

Long-Term Prepaid Expense - 66,176

LIABILITIES AND SHAREHOLDERS' EQUITY:

Current Liabilities:

SBA EIDL (including accrued interest) (Note 7) 8,772 8,772

Long-Term Liabilities:

Commitments and Contingencies (Note 11)

SHAREHOLDERS' EQUITY:

See accompanying notes to these consolidated financial statements which are an integral part of these consolidated financial statements.

F-3

60 DEGREES PHARMACEUTICALS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

For the Years Ended December 31,

Product Revenues – net of Discounts and Rebates $ 1,005,471 $ 607,574

Operating Expenses:

Loss from Operations before Provision for Income Taxes (7,368,325) (7,955,663)

Provision for Income Taxes (Note 9) - -

Net Loss – Noncontrolling Interest (3,167) (8,556)

Comprehensive Loss:

Unrealized Foreign Currency Translation Gain (Loss) 7,127 (90)

Net Loss – Noncontrolling Interest (3,167) (8,556)

Cumulative Dividends on Series A Preferred Stock (501,056) (483,301)

Net Loss - attributed to common stockholders $ (7,859,087) $ (8,430,498)

Net Loss per Common Share(1)

Weighted Average Number of Common Shares Outstanding(1)

See accompanying notes to these consolidated financial statements which are an integral part of these consolidated financial statements.

F-4

60 DEGREES PHARMACEUTICALS, INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

For the Year Ended December 31, 2025

Shares Amount Shares Amount

Share rounding adjustment for 1:5 Reverse Stock Split - - (7) - - - - - - -

F-5

For the Year Ended December 31, 2024

Shares Amount Shares Amount

Issuance of shares for RSUs - - 1,070 - - - - - -

Voluntary return of shares issued to vendor for services - - (500) - - - - - - -

Net foreign translation loss - - - - - - (90) (90) - (90)

See accompanying notes to these consolidated financial statements which are an integral part of these consolidated financial statements.

F-6

60 DEGREES PHARMACEUTICALS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

CASH FLOWS FROM OPERATING ACTIVITIES

Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:

Amortization of ROU Asset - 13,517

Amortization of Capitalized Share-Based Payments 176,471 3,575,881

Share-Based Compensation under Equity Incentive Plan 279,873 32,767

Change in Fair Value of Derivative Liabilities (266,089) (1,665,966)

Write-offs of Capitalized Patents - 108,424

Change in Inventory Reserve 251,677 -

Changes in Operating Assets and Liabilities:

Reduction of Lease Liability - (13,650)

CASH FLOWS FROM INVESTING ACTIVITIES

Maturities of Short-Term Investments 1,708,000 -

Net Cash Provided by (Used in) Investing Activities 254,916 (1,889,114)

CASH FLOWS FROM FINANCING ACTIVITIES

Shares Withheld for Net Share Settlement of Performance Bonuses (18,000) -

Net proceeds from Private Placement - 3,414,502

Proceeds from Exercise of Pre-Funded Warrants 2,804 10,963

Effect of Exchange Rate Changes on Cash 7,127 499

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Cash paid During the Year for Interest $ 8,772 $ 8,772

Cash paid During the Year for Income Taxes $ - $ -

NONCASH INVESTING/FINANCING ACTIVITIES

Conversion of Series A Preferred Stock into Common Stock $ - $ 290,601

Capitalized Share-Based Payments to Vendors $ - $ 26,325

Fair Value of Warrants Issued to Underwriters $ - $ 71,364

Capitalized Patent Costs included in Accounts Payable $ 24,292 $ -

Capitalized Website Costs included in Accounts Payable $ 4,330 $ -

ATM Offering Costs included in Accounts Payable $ 53,500 $ -

Gross Shares Issued for Annual Performance Bonuses $ 121,544 $ -

See accompanying notes to these consolidated financial statements which are an integral part of these consolidated financial statements.

F-7

60 DEGREES PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. NATURE OF OPERATIONS

60 Degrees Pharmaceuticals, Inc. was incorporated in Delaware on June 1, 2022 and merged on the same day with 60 Degrees Pharmaceuticals, LLC, a District of Columbia limited liability company organized on September 9, 2010 (“60P LLC”). 60 Degrees Pharmaceuticals, Inc. and its subsidiary (referred to collectively as the “Company”, “60P”, or “60 Degrees Pharmaceuticals”) is a specialty pharmaceutical company that specializes in the development and marketing of new medicines for the treatment and prevention of infectious diseases. 60P achieved FDA approval of its lead product, ARAKODA® (tafenoquine), for malaria prevention, in 2018. Currently, 60P’s pipeline under development covers development programs for vector-borne diseases utilizing three of the Company’s future products: (i) new products that contain the Arakoda regimen of tafenoquine; (ii) new products that contain tafenoquine; and (iii) celgosivirand/or botanical extracts from Australian Chestnut Trees. The Company’s headquarters are located in Washington, D.C., with a majority-owned subsidiary in Australia.

Since the Company’s initial public offering in July 2023, its common stock has been listed and trades on The Nasdaq Capital Market under the symbol “SXTP,” and tradeable warrants under the symbol “SXTPW.”

Risks and Uncertainties

The Company is subject to risks common to companies in the biopharmaceutical industry including, but not limited to, the risks associated with developing product candidates and successfully launching and commercializing its drug/device combination products, the Company’s ability to obtain regulatory approval of its such products in the United States and other geography markets, the uncertainty of the broad adoption of its approved products by physicians and consumers, and significant competition.

In addition, higher rates of inflation have resulted in the U.S. Federal Reserve raising interest rates. Increases in interest rates, especially if coupled with reduced government spending and volatility in financial markets, may further increase economic uncertainty and heighten these risks. Furthermore, if additional banks and financial institutions enter receivership or become insolvent in the future in response to financial conditions affecting the banking system and financial markets, the Company or its partners’ ability to access existing cash, cash equivalents and investments may be threatened and could have a material adverse effect on the Company’s business and financial condition, including the Company’s ability to access additional capital on favorable terms, or at all, which could in the future negatively affect the Company’s ability to pursue its business strategy.

Going Concern

The Company’s future results are subject to substantial risks and uncertainties. Since its inception, the Company has not demonstrated the ability to generate enough revenues to date to cover operating expenses and has accumulated losses to date. At December 31, 2025, the Company had cash and cash equivalents totaling $1,510,065, as compared to cash and cash equivalents totaling $1,659,353 at December 31, 2024. During the year ended December 31, 2025, the Company used cash of $6,849,022 in its operating activities ($5,648,088 during the year ended December 31, 2024). The Company’s capital commitments over the next twelve months include interest and principal payments on the Company’s debt arrangement of $8,772, $1,459,279 to satisfy accounts payable and accrued expenses, and $18,775 payable under its short-term lease arrangement. In addition, the Company is subject to certain royalty obligations based on future net product sales (See Note 11).

To date, the Company has funded its operations primarily with proceeds from sales of common stock and warrants for the purchase of common stock, sales of preferred stock, proceeds from the issuance of convertible debt and borrowings under loan and security agreements.

Continuation as a going concern is dependent upon the Company’s ability to meet its financial requirements, raise additional capital, and achieve gross profitability from the Company’s single marketed product. To achieve profitability, the Company expects it will need to raise additional capital to fund its activities relating to commercial support for its existing product and any future clinical research trials and operating activities. However, there can be no assurance that it will ever achieve or maintain profitability. These conditions, among others, raise substantial doubt about the ability of the Company to continue as a going concern for one year from the date these financial statements are issued.

Management plans to fund operations of the Company through third party and related party debt/advances, private placement of restricted securities and the issuance of stock in a subsequent offering until such a time as the business achieves profitability or a business combination may be achieved. However, there can be no assurance that the Company will be successful in raising additional capital or that such capital, if available, will be on terms that are favorable to the Company. Debt financing and equity financing, if available, may involve agreements that include covenants limiting or restricting the Company’s ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If the Company raises funds through collaborations, or other similar arrangements with third parties, it may have to relinquish valuable rights to its technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to the Company and/or may reduce the value of its common stock. If the Company is unable to raise additional funds through equity or debt financings when needed, it may be required to delay, limit, reduce or terminate its product development or future commercialization efforts or grant rights to develop and market its product candidates even if the Company would otherwise prefer to develop and market such product candidates itself.

As such, management concluded that such plans do not alleviate the substantial doubt about the ability of the Company to continue as a going concern for one year from the date these financial statements are issued.

These financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of obligations in the normal course of business, and do not include any adjustments to the amount and classification of assets and liabilities that may be necessary should the Company be unable to continue as a going concern.

F-8

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The financial statements of 60P and its subsidiary are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Company has prepared the accompanying consolidated financial statements pursuant to the instructions to Form 10-K and Article 8 of Regulation S-X of the Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments considered necessary for a fair presentation of the Company’s financial position, results of operations and cash flows have been included and are of a normal and recurring nature.

Principles of Consolidation and Noncontrolling Interest

The Company’s consolidated financial statements include the financial statements of its 96.61% owned subsidiary, 60P Australia Pty Ltd. All significant intercompany accounts and transactions have been eliminated in consolidation.

For entities that are consolidated, but not 100% owned, a portion of the income or loss and corresponding equity is allocated to owners other than the Company. The aggregate of the income or loss and corresponding equity that is not owned by us is included in Noncontrolling Interest in the consolidated financial statements.

Use of Estimates

Reverse Stock Splits

Following stockholder approval in July 2024, the Company effected a reverse stock split at a ratio of 1:12 (the “1:12 Reverse Stock Split”), which was effective as of August 12, 2024. Following stockholder approval in November 2024, the Company effected an additional reverse stock split at a ratio of 1:5 (the “1:5 Reverse Stock Split), which was effective as of February 24, 2025. Following stockholder approval in October 2025, the Company effected an additional reverse stock split at a ratio of 1:4 (the “1:4 Reverse Stock Split” and together with the 1:12 Reverse Stock Split and the 1:5 Reverse Stock Split, the “Reverse Stock Splits”), which was effective January 20, 2026 (See Note 12 – Subsequent Events).

Proportional adjustments were made to the number of shares of common stock issuable upon exercise or conversion of the Company’s equity awards, warrants, and other equity instruments convertible into common stock, as well as the respective exercise prices, if applicable, in accordance with the terms of the instruments. Unless otherwise noted, all references to numbers of shares of the Company’s common stock and per share information presented in these consolidated financial statements have been retroactively adjusted, as appropriate, to reflect the Reverse Stock Splits, including reclassifying an amount equal to the reduction in par value of common stock to additional paid-in capital.

Cash and Cash Equivalents

The Company’s cash consists of cash deposited in demand accounts at financial institutions, which are insured by the Federal Deposit Insurance Corporation (“FDIC”). The Company considers short-term highly liquid investments with original maturities of three months or less to be cash equivalents. The Company’s cash and cash equivalents, at times, may exceed the FDIC insurable limits (currently $250,000). The Company has not experienced any losses related to amounts in excess of FDIC Limits. The Company periodically assesses the credit risk associated with these financial institutions and believes that the risk of loss is minimal.

Short-Term Investments

Short-term investments consist of certificates of deposit with original maturities of greater than three months and less than twelve months, which are classified as held-to-maturity as the Company has the intent and ability to hold these investments until they mature. The classification of short-term investments is determined at the time of purchase and is reevaluated at each balance sheet date. Short-term investments are reported at amortized cost.

F-9

Accounts Receivable and Allowance for Doubtful Accounts

The Company records accounts receivable at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts to reflect any loss anticipated on the trade accounts receivable balances and charged to the provision for doubtful accounts. Based on the Company’s history there has been no need to make a recording to Allowance for Doubtful Accounts. Most of the Company’s revenue has been earned via government contracts, an Australian pharmaceutical distributor and a large American pharmaceutical distributor. There was no allowance as of December 31, 2025 and December 31, 2024. As the Company continues to engage with smaller distributors, it will continue to analyze whether an allowance should be established. As of December 31, 2025, the U.S. pharmaceutical distributor accounted for 97% of the accounts receivable balance (95% as of December 31, 2024).

Inventory

Inventories are stated at the lower of cost or net realizable value. Cost is comprised of direct materials and, where applicable, costs that have been incurred in bringing the inventories to their present location and condition. The Company uses the Specific Identification method per lot. A box or a bottle price is calculated per lot number and sales are recognized by their lot number.

The Company regularly monitors its inventory levels to identify inventory that may expire or has a cost basis in excess of its estimated realizable value, and records write-downs for inventory that has expired, inventory that has a cost basis in excess of its expected net realizable value, and inventory in excess of expected sales requirements. Any write-downs of inventories are charged to Cost of Revenues in the Consolidated Statements of Operations and Comprehensive Loss. During the year ended December 31, 2025, write-downs for expired inventory totaled $445,181 ($22,046 for the year ended December 31, 2024).

Property and Equipment

Property and equipment are stated at cost. Normal repairs and maintenance costs are charged to earnings as incurred and additions and major improvements are capitalized. The cost of assets retired or otherwise disposed of and the related depreciation are eliminated from the accounts in the period of disposal and the resulting gain or loss is credited or charged to earnings.

Depreciation is computed over the estimated useful lives of the related asset type or term of the operating lease using the straight-line method for financial statement purposes. The estimated service lives for Property and Equipment are either three (3), five (5) or seven (7) years.

Impairment of Long-lived Assets

Long-lived assets, such as property and equipment and identifiable intangibles with finite useful lives, are periodically evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company monitors for potential indicators of a trigger event for asset impairment, including whether there is an adverse change in the extent or manner in which an asset is being used or its physical condition. Assets are grouped and evaluated for impairment at the lowest level of which there are identifiable cash flows, which is generally at a location level. Assets are reviewed using factors including, but not limited to, future operating plans and projected cash flows. The determination of whether impairment has occurred is based on an estimate of undiscounted future cash flows directly related to the assets, compared to the carrying value of the assets. If the sum of the undiscounted future cash flows of the assets does not exceed the carrying value of the assets, full or partial impairment may exist. If the asset’s carrying amount exceeds its fair value, an impairment charge is recognized in the amount by which the carrying amount exceeds the fair value of the asset. Fair value is determined using an income approach, which requires discounting the estimated future cash flows associated with the asset.

Intangible Assets

The Company capitalizes its patent and filing fees and legal patent and prosecution fees in connection with internally developed pending patents. When pending patents are issued, patents will be amortized over the expected period to be benefitted, not to exceed the patent lives, which may be as long as ten to fifteen years.

Website Development Costs

The Company accounts for website development costs in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Subtopic No. 350-50, Website Development Costs. Accordingly, all costs incurred in the planning stage are expensed as incurred, costs incurred in the website application and infrastructure development stage that meet specific criteria are capitalized and costs incurred in the day-to-day operation of the website are expensed as incurred. All costs associated with the websites are subject to straight-line amortization over a three-year period.

Derivative Liabilities

The Company assesses the classification of its derivative financial instruments each reporting period, which formerly consisted of bridge shares, convertible notes payable, and certain warrants, and determined that such instruments initially qualified for treatment as derivative liabilities as they met the criteria for liability classification under ASC 815. As of December 31, 2025, the Company’s derivative financial instruments consist of contingent payment arrangements.

F-10

The Company analyzes all financial instruments with features of both liabilities and equity under FASB ASC Topic No. 480, Distinguishing Liabilities from Equity (“ASC 480”), and FASB ASC Topic No. 815, Derivatives and Hedging (“ASC 815”). Derivative liabilities are adjusted to reflect fair value at each reporting period, with any increase or decrease in the fair value recorded in the results of operations, as a component of other income or expense as change in fair value of derivative liabilities.The Company uses a probability-weighted expected return method to determine the fair value of these instruments.

Upon conversion or repayment of a debt or equity instrument in exchange for equity shares, where the embedded conversion option has been bifurcated and accounted for as a derivative liability (generally convertible debt and warrants), the Company records the equity shares at fair value on the date of conversion, relieves all related debt, derivative liabilities, and unamortized debt discounts, and recognizes a net gain or loss on debt extinguishment, if any.

Equity or liability instruments that become subject to reclassification under ASC Topic 815 are reclassified at the fair value of the instrument on the reclassification date.

Equity-Classified Warrants

As of December 31, 2025, the Company accounts for all outstanding warrants to purchase common stock as equity-classified instruments based on an assessment of the warrants’ specific terms and applicable authoritative guidance in ASC 480 and ASC 815. This assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own common stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the respective issuance dates and as of each subsequent reporting period while the warrants are outstanding.

Income Taxes

60 Degrees Pharmaceuticals, Inc. is a corporation for U.S. Federal and state income tax purposes. The tax years that remain subject to examination by major tax jurisdictions include the years ended December 31, 2022, 2023, 2024 and 2025. 60P Australia Pty Ltd. is subject to taxation by the Australian Taxation Office.

Management assesses, on a jurisdictional basis, the available means of recovering deferred tax assets, including the ability to carry-back net operating losses, the existence of reversing temporary differences, the availability of tax planning strategies and available sources of future taxable income. On the basis of this evaluation, the Company has determined that it is not more likely than not that the Company will recognize the benefits of its net deferred tax assets, and, as a result, a full valuation allowance has been recorded against its net deferred tax assets as of December 31, 2025 and December 31, 2024.

During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. The Company establishes reserves for tax-related uncertainties based on estimates of whether, and the extent to which, additional taxes will be due. These reserves are established when the Company believes that certain positions might be challenged despite its belief that its tax return positions are fully supportable. The Company adjusts these reserves in light of changes in facts and circumstances, such as the outcome of tax examinations. As of December 31, 2025 and December 31, 2024, no reserves for uncertain tax positions have been established.

The Company recognizes interest and penalties accrued related to unrecognized tax benefits as income tax expense. During the years ended December 31, 2025 and 2024, the Company did not recognize interest and penalties related to unrecognized tax benefits.

Concentrations

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments, accounts receivable, inventory purchases, and borrowings.

Significant customers represent any customer whose business makes up 10% of receivables or revenues. At December 31, 2025, significant customers represented 97% of receivables (consisting of three customers and one significant customer) and 92% of total net product revenues (consisting of three customers and one significant customer). At December 31, 2024, significant customers represented 95% of receivables (consisting of three customers and one significant customer) and 95% of total net product revenues (consisting of three customers and one significant customer).

Currently, the Company has exclusive relationships with distributors in Australia and Europe. A failure to perform by any of our current distributors would create disruption for patients in those markets.

Since the Company first started working on tafenoquine all inventory has been acquired in a collaborative relationship from a sole vendor. Should the vendor cease to supply tafenoquine it would take significant costs and efforts to rebuild the supply chain with a new sole vendor sourcing the active pharmaceutical ingredient (“API”).

F-11

Segment Information

Since its inception, the Company operates and manages its business as a single identifiable segment, focused on the development and marketing of new medicines for the treatment and prevention of infectious diseases. The determination of a single business segment is consistent with the consolidated financial information regularly provided to the Company’s chief operating decision maker (“CODM”).

The Company’s CODM is its Chief Executive Officer, who reviews and evaluates consolidated net income or loss for purposes of evaluating performance, making operating decisions, allocating resources, and planning and forecasting for future periods. The significant components of consolidated net income or loss regularly provided to the CODM include net product revenues and the significant expense categories presented in the accompanying Consolidated Statements of Operations and Comprehensive Loss (cost of revenues, research and development, and general and administrative expenses). These are presented at the consolidated level and used by the CODM to monitor budgeted versus actual results to make key operating decisions. The information and operating expense categories presented in the accompanying Consolidated Statements of Operations and Comprehensive Loss are fully reflective of the significant expense categories and amounts that are regularly provided to the CODM.

The measure of segment assets that is regularly reported to the CODM includes cash and cash equivalents and short-term investments, each as reported on the Consolidated Balance Sheets. Total consolidated cash and cash equivalents and short-term investments were $2,750,786 and $3,387,825 as of December 31, 2025 and December 31, 2024, respectively.

Revenue Recognition

The Company recognizes revenue in accordance with FASB ASC Topic No. 606, Revenue from Contracts with Customers (“ASC 606”). Revenues are recognized when control is transferred to customers in amounts that reflect the consideration the Company expects to be entitled to receive in exchange for those goods. Revenue recognition is evaluated through the following five steps: (i) identification of the contract, or contracts, with a customer; (ii) identification of the performance obligations in the contract; (iii) determination of the transaction price; (iv) allocation of the transaction price to the performance obligations in the contract; and (v) recognition of revenue when or as a performance obligation is satisfied. As part of the accounting for these arrangements, the Company may be required to make significant judgments, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each performance obligation.

Revenues from product sales are recorded at the net sales price, or “transaction price,” which may include estimates of variable consideration that result from product returns. The Company determines the amount of variable consideration by using either the expected value method or the most-likely-amount method. The Company includes the unconstrained amount of estimated variable consideration in the transaction price, which reflects the amount for which it is probable that a significant reversal of cumulative revenue recognized will not occur. At the end of each subsequent reporting period, the Company re-evaluates the estimated variable consideration included in the transaction price and any related constraint, and if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis in the period of adjustment. Reserves are established for the estimates of variable consideration based on the amounts the Company expects to be earned or to be claimed on the related sales.

The Company receives the majority of its revenues from sales of its ArakodaTM product to resellers in the US and abroad. The Company records US commercial revenues as a receivable when our American distributor transfers shipped product to their title model for 60P. Foreign sales to both Australia and Europe are recognized as a receivable at the point product is shipped to distributor. Historically, the shipments to Australia and Europe were further subject to profit sharing agreements for boxes sold to customers.

In addition to revenue from product sales, beginning in the third quarter of 2024, the Company recognizes research revenues associated with its contract with the United States Army Medical Materiel Development Activity (USAMMDA) for Arakoda supply chain upgrade support. Research revenue under this contract is recognized when the direct costs eligible for reimbursement are incurred, up to the maximum allowable amount. Other research revenues consist of sales of clinical trial supplies, which are recognized at a point in time, and research rebates earned from the Australian Tax Authority, which are recognized over time as qualifying research activities in Australia are performed.

Research and Development Costs

The Company accounts for research and development costs in accordance with FASB ASC Subtopic No. 730-10, Research and Development (“ASC 730-10”). Under ASC 730-10, research and development costs are expensed as incurred. Accordingly, internal research and development costs are expensed as incurred. Prepayments for research and development services are deferred and amortized over the service period as the services are provided. Advance payments for specific materials, equipment, or facilities determined to have no alternative future use are initially deferred and recognized as research and development expense when the related goods are delivered.

The Company recorded $2,106,156 in research and development costs during the year ended December 31, 2025 ($4,986,526 for the year ended December 31, 2024). The Company has also issued shares of common stock to nonemployees in exchange for research and development services. The Company recognizes prepaid research and development costs on the grant date, as defined in FASB ASC Subtopic No. 718, Compensation – Stock Compensation. See Note 10 for further details.

Fair Value of Financial Instruments and the Fair Value Option (“FVO”)

The inputs used to measure fair value are based on a hierarchy that prioritizes observable and unobservable inputs used in valuation techniques. These levels, in order of highest to lowest priority, are described below:

F-12

The Company may choose to elect the FVO for certain eligible financial instruments, such as certain Promissory Notes, in order to simplify the accounting treatment. Items for which the FVO has been elected are presented at fair value in the Consolidated Balance Sheets and any change in fair value unrelated to credit risk is recorded in Other Expense, net in the Consolidated Statements of Operations and Comprehensive Loss. Changes in fair value related to credit risk are recognized in Other Comprehensive Loss. As a result of the completion of the IPO, all financial instruments for which the FVO was elected were extinguished. See Note 7 for more information on the extinguishment of the Promissory Notes.

The Company’s financial instruments recorded at fair value on a recurring basis at December 31, 2025, and December 31, 2024 include the derivative liability associated with the contingent milestone payment due to Knight upon a future sale of ArakodaTM or a Change of Control, which is carried at fair value based on Level 3 inputs. The Company uses a probability-weighted expected return method to determine the fair value of the contingent milestone payment using significant inputs such as the timing and probability of discrete potential exit scenarios, forward interest rate curves, and discount rates based on implied and market yields. See Note 8 for more information on Derivative Liabilities.

Liabilities measured at fair value at December 31, 2025 and 2024 are as follows:

Level 1 Level 2 Level 3 Total

Liabilities:

Level 1 Level 2 Level 3 Total

Liabilities:

There were no transfers of financial instruments between Level 1, Level 2, and Level 3 during the periods presented. A rollforward of liabilities measured at fair value using Level 3 inputs outstanding during the years ended December 31, 2025 and 2024 is presented in Note 8 (Derivative Liabilities).

Assets and Liabilities Not Measured at Fair Value on a Recurring Basis

In addition to assets and liabilities that are measured at fair value on a recurring basis, the Company also measures certain assets and liabilities at fair value on a non-recurring basis. The Company’s non-financial assets, including Intangible Assets and Property and Equipment, are measured at fair value when there is an indication of impairment and the carrying amount exceeds the asset’s projected undiscounted cash flows. These assets are recorded at fair value only when an impairment charge is recognized.

As of December 31, 2025 and 2024, the carrying value of the Company’s financial instruments included in current assets and current liabilities (such as cash, accounts receivable, accounts payable, and accrued expenses) approximate their fair value due to the short-term nature of such instruments. Certificates of deposit, classified as cash equivalents or short-term investments depending on the instrument’s original time to maturity, are measured at amortized cost, which approximates fair value as of December 31, 2025 and 2024.

Foreign Currency Transactions and Translation

The individual financial statements of each group entity are measured and presented in the currency of the primary economic environment in which the entity operates (its functional currency). The consolidated financial statements of the Company are presented in US dollars, which is the functional currency of the Company and the presentation currency for the consolidated financial statements.

For the purpose of presenting consolidated financial statements, the assets and liabilities of the Company’s foreign operations are mostly translated at exchange rates prevailing on the reporting date. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognized as a component of other comprehensive income (loss) as Unrealized Foreign Currency Translation Gain or Loss.

Exchange rates along with historical rates used in these financial statements are as follows:

Average Exchange Rate

Year Ended December 31, As of

F-13

Reclassifications

Certain prior period amounts have been reclassified for consistency with the current period presentation. These reclassifications had no material effect on the consolidated results of operations and comprehensive loss, shareholders’ equity, or cash flows.

Share-Based Payments

On November 22, 2022, the Company adopted the 2022 Equity Incentive Plan also referred to as (“2022 Plan”). The 2022 Plan and related share-based awards are discussed more fully in Note 10.

The Company accounts for share-based payments in accordance with ASC Subtopic 718, Compensation - Stock Compensation (“ASC 718”). The Company measures compensation for all share-based payment awards granted to employees, directors, and nonemployees, based on the estimated fair value of the awards on the date of grant. For awards that vest based on continued service, the service-based compensation cost is recognized on a straight-line basis over the requisite service period, which is generally the vesting period of the awards. For service vesting awards with compensation expense recognized on a straight-line basis, at no point in time does the cumulative grant date value of vested awards exceed the cumulative amount of compensation expense recognized. The grant date is determined based on the date when a mutual understanding of the key terms of the share-based awards is established. The Company accounts for forfeitures as they occur.

The Company estimates the fair value of all stock option awards as of the grant date by applying the Black-Scholes option pricing model. The application of this valuation model involves assumptions, including the fair value of the common stock, expected volatility, risk-free interest rate, expected dividends and the expected term of the option. Due to the lack of a public market for the Company’s common stock prior to the IPO and lack of company-specific historical implied volatility data, the Company has based its computations of expected volatility on the historical volatility of a representative group of public companies with similar characteristics of the Company, including stage of development and industry focus. The historical volatility is calculated based on a period of time commensurate with the expected term assumption. The Company generally uses the simplified method as prescribed by the SEC Staff Accounting Bulletin Topic 14, Share-Based Payment, to estimate the expected term for stock options, whereby, the expected term equals the midpoint of the weighted average remaining time to vest, vesting period and the contractual term of the options due to its lack of historical exercise data. For certain options granted out-of-the-money, the Company’s best estimate of the expected term is the contractual term of the award. The risk-free interest rate is based on U.S. Treasury securities with a maturity date commensurate with the expected term of the associated award. The expected dividend yield is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock. The assumptions used in calculating the fair value of share-based awards represent management’s best estimates and involve inherent uncertainties and the application of significant judgment.

Compensation expense for restricted stock units (“RSUs”) with only service-based vesting conditions is recognized on a straight-line basis over the vesting period. Compensation cost for service-based RSUs is based on the grant date fair value of the award, which is the closing market price of the Company’s common stock on the grant date multiplied by the number of shares awarded.

For fully vested, nonforfeitable equity instruments that are granted at the date the Company and a nonemployee enter into an agreement for goods or services, the Company recognizes the fair value of the equity instruments on the grant date. The corresponding cost is recognized as an immediate expense or a prepaid asset and expensed over the service period depending on the specific facts and circumstances of the agreement with the nonemployee. See Note 10 for further details.

F-14

Net Loss per Common Share

Net Loss per Common Share is computed by dividing net loss attributable to common shareholders by the weighted average number of common shares outstanding during each period. The Company has included the Pre-Funded Warrants issued in January 2024 and September 2024 (See Note 6) in its computation of basic and diluted net loss per share due to their nominal exercise prices. The cumulative dividends accrued on the Series A Preferred Stock during the period are reflected as an addition to net loss in determining basic and diluted net loss attributable to common stockholders.

As the Company has reported a net loss for all periods presented, the calculation of diluted net loss per common share is the same as basic net loss per common share for those periods.

As a result of the Reverse Stock Splits, which were effective as of August 12, 2024 at a ratio of 1:12, February 24, 2025 at a ratio of 1:5, and January 20, 2026 at a ratio of 1:4, all shares of outstanding common stock and net loss per common share calculations have been retroactively adjusted for all periods presented.

Related Parties

Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests.

Subsequent Events

The Company considers events or transactions that occur after the balance sheet date, but prior to the issuance of the financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated through March 30, 2026, which is the date the financial statements were issued. See Note 12.

Recently Adopted and Issued Accounting Pronouncements

From time to time, the FASB issues Accounting Standards Updates (“ASU”) to amend the authoritative literature in the ASC. The Company regularly evaluates new ASUs to determine the impact that these pronouncements may have on the consolidated financial statements. Other than the pronouncements listed below, the Company believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, or (iii) are not applicable to the Company’s consolidated financial statements or related disclosures.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”) which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses and segment profit or loss. ASU 2023-07 also requires entities with a single reportable segment to provide all segment disclosures under ASC 280, including the new required disclosures under the ASU. The Company adopted ASU 2023-07 on a retrospective basis for the 2024 annual period, and for interim periods beginning in 2025. The impact is limited to the Company’s financial statement disclosures, which are presented in the Segment Information section above.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (ASC 740): Improvements to Income Tax Disclosures (“ASU 2023-09”) which requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. ASU 2023-09 was effective for the Company’s annual period ending December 15, 2025. The impact of the adoption is limited to the Company’s financial statement disclosures, which are presented on a prospective basis. See Note 9 – Income Taxes.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), which applies to all public business entities that file financial statements with the SEC. The amendments in this ASU require public business entities to disclose on an annual and interim basis, disaggregated information about certain income statement expense line items. The new standard is effective for fiscal years beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the impact that ASU 2024-03 will have on its financial statement disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”), which amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40. The amendments modernize the recognition and disclosure framework for internal-use software costs, removing the previous “development stage” model and introducing a more judgment-based approach. The ASU is effective for all entities for interim and annual periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact that ASU 2025-06 will have on its consolidated financial statements.

In September 2025, the FASB issued ASU 2025-07, Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract (“ASU 2025-07”). ASU 2025-07 adds a new scope exception from derivative accounting under ASC 815 for certain non-exchange-traded contracts with customers with an underlying that is based on operations or activities specific to one of the parties to the contract. Further, ASU 2025-07 clarifies that an entity should apply the guidance in ASC 606 to a contract with stock-based noncash consideration. The ASU is effective for annual periods beginning after December 15, 2026 and interim periods within those annual periods, with early adoption permitted. The Company is currently evaluating the impact that ASU 2025-06 will have on its consolidated financial statements.

F-15

3. INVENTORY

Inventory consists of the following major classes:

Raw Material (API) $ 75,662 $ -

Reserve for Expiring Inventory (251,677) -

4. PROPERTY AND EQUIPMENT

As of December 31, 2025 and 2024, Property and Equipment, net consists of:

Depreciation expenses for the years ended December 31, 2025 and 2024 were in the amount of $43,324 and $11,726, respectively.

5.INTANGIBLE ASSETS

As of December 31, 2025 and 2024, Intangible Assets, net consist of:

During the years ended December 31, 2025 and 2024, the Company capitalized website development-related costs of $27,000 and $25,374 respectively, in connection with the upgrade and enhancement of functionality of the corporate website at www.60degreespharma.com. Amortization expense for the years ended December 31, 2025, and 2024 was in the amount of $39,548 and $38,502, respectively.During the years ended December 31, 2025 and 2024, write-downs for expired or obsolete patents totaled $0 and $108,424, respectively.

The following table summarizes the estimated future amortization expense for our patents and website development costs as of December 31, 2025:

Period Patents Website Development Costs

The Company additionally has $114,697 in capitalized patent expenses that will become amortizable as the patents they are associated with are awarded.

F-16

6.STOCKHOLDERS’ EQUITY

Pursuant to the Certificate of Incorporation of 60 Degrees Pharmaceuticals, Inc., the Company’s authorized shares consist of (a) 150,000,000 shares of common stock, par value $0.0001 per share and (b) 1,000,000 shares of preferred stock, par value $0.0001 per share, of which 80,965 have been designated as Series A Non-Voting Convertible Preferred Stock (“Series A Preferred Stock”). As of December 31, 2025, 1,163,142 shares of Common Stock and 76,480 shares of Series A Preferred Stock are issued and outstanding.

Following stockholder approval in July 2024, on July 30, 2024, the Company filed an Amendment to the Certificate of Incorporation with the Secretary of State of Delaware to effect the 1:12 Reverse Stock Split of the issued and outstanding shares of the Company’s common stock, which was effective as of August 12, 2024. As of the effective time of the 1:12 Reverse Stock Split, every twelve (12) issued and outstanding shares of the Company’s common stock were automatically combined and converted into one (1) issued and outstanding share of the Company’s common stock, reducing the number of shares of common stock outstanding from 21,219,937 shares to 1,768,337 shares (not including the effects of the 1:5 Reverse Stock Split or the 1:4 Reverse Stock Split discussed below). No fractional shares of common stock were issued in connection with the Reverse Stock Split and all fractional shares were rounded up to the nearest whole share with respect to outstanding shares of common stock. The Company issued an additional 4,675 shares of common stock on August 19, 2024 for rounding due to fractional shares (93,563 not including the effects of the 1:5 Reverse Stock Split or the 1:4 Reverse Stock Split discussed below).

Following stockholder approval in November 2024, on February 18, 2025, the Company filed an additional Amendment to the Certificate of Incorporation with the Secretary of State of Delaware to effect the 1:5 Reverse Stock Split of the issued and outstanding shares of the Company’s common stock, which was effective as of February 24, 2025. As of the effective time of the 1:5 Reverse Stock Split, every five (5) issued and outstanding shares of the Company’s common stock were automatically combined and converted into one (1) issued and outstanding share of the Company’s common stock, reducing the number of shares of common stock outstanding from 7,364,554 shares to 1,472,891 shares (not including the effects of the 1:4 Reverse Stock Split discussed below). No fractional shares of common stock were issued in connection with the 1:5 Reverse Stock Split. All fractional shares were rounded up to the nearest whole share with respect to outstanding shares of common stock.

Following stockholder approval in October 2025, on January 14, 2026, the Company filed an additional Amendment to the Certificate of Incorporation with the Secretary of State of Delaware to effect the 1:4 Reverse Stock Split of the issued and outstanding shares of the Company’s common stock, which was effective as of January 20, 2026. As of the effective time of the 1:4 Reverse Stock Split, every four (4) issued and outstanding shares of the Company’s common stock were automatically combined and converted into one (1) issued and outstanding share of the Company’s common stock, reducing the number of shares of common stock outstanding from 5,436,441 shares to 1,359,091 shares. No fractional shares of common stock were issued in connection with the 1:4 Reverse Stock Split. All fractional shares were rounded up to the nearest whole share with respect to outstanding shares of common stock. See Note 12 – Subsequent Events.

The Reverse Stock Splits did not change the authorized number of shares of common stock or preferred stock, the par value of the common stock, or the number of issued and outstanding shares of Series A Preferred Stock. All references to numbers of shares of the Company’s common stock and per share information in these consolidated financial statements have been retroactively adjusted, as appropriate, to reflect the Reverse Stock Splits, including reclassifying an amount equal to the reduction in par value of common stock to additional paid-in capital.

Common Stock

January 2024 Offering

On January 29, 2024, the Company, entered into an Underwriting Agreement with WallachBeth Capital LLC, relating to the Company’s public offering (the “January 2024 Offering”) of 21,921 units at an offering price of $92.40 per unit and 4,164 pre-funded units at an offering price of $90.00 per pre-funded unit. Each unit consisted of one share of common stock and one warrant exercisable for one share of common stock (the “January 2024 Warrants”). Each pre-funded unit consists of one pre-funded warrant exercisable for one share of common stock (the “January 2024 Pre-Funded Warrants”) and one warrant identical to the January 2024 Warrants included in the units. The January 2024 Pre-Funded Warrants have an exercise price of $2.40 per share, were immediately exercisable beginning on January 31, 2024 until exercised in full. The January 2024 Warrants have an exercise price of $101.64 per share and are exercisable beginning on January 31, 2024 until January 31, 2029.

The Company granted WallachBeth Capital LLC a 45-day over-allotment option to purchase up to 3,289 shares of the Company’s common stock at a price of $92.40 per share and/or 3,913 January 2024 Warrants at a price of $2.40 per warrant and/or 625 January 2024 Pre-Funded Warrants at a price of $90.00 per pre-funded warrant, or any combination thereof, in all cases less the underwriting discount. WallachBeth Capital LLC partially exercised its over-allotment option with respect to 3,410 January 2024 Warrants on January 31, 2024, and purchased an additional one share of common stock at a purchase price of $90.00 per share and one January 2024 Warrant at a purchase price of $2.40 per warrant on February 14, 2024.

F-17

The Company also issued to WallachBeth Capital LLC warrants (the “January 2024 Representative Warrants”) to purchase 1,565 shares of the Company’s common stock at an exercise price of $101.64 per share. The January 2024 Representative Warrants are exercisable beginning on January 31, 2024 until January 31, 2029.

The units and pre-funded units were offered and sold pursuant to the Company’s Registration Statement on Form S-1 (File No. 333-276641), declared effective by the SEC on January 29, 2024. The closing of the January 2024 Offering occurred on January 31, 2024, generating net proceeds to the Company of approximately $1.9 million, after deducting underwriting discounts and commissions and the payment of other offering expenses payable by the Company of approximately $510,000.

2024 ATM Agreement

On July 12, 2024, the Company entered into an At-the-Market Issuance Sales Agreement (the “2024 ATM Agreement”) with WallachBeth Capital LLC as sales agent, to sell shares of common stock having an aggregate offering price of up to $1,253,603 from time to time, through an “at the market offering” program (the “2024 ATM Offering”). The offer and sale of shares of common stock from the ATM Offering were made pursuant to the Company’s shelf registration statement on Form S-3 and accompanying base prospectus (Registration Statement No. 333-280796) contained therein which became effective on July 18, 2024. The prospectus supplement was subsequently amended four times to increase the maximum aggregate offering price under the ATM Agreement. From July 19, 2024 to August 1, 2024, the Company sold a total of 33,897 shares in the ATM Offering for gross proceeds of $1,994,583. The Company and Wallachbeth Capital LLC entered into a Waiver and Termination Agreement, agreeing to terminate the 2024 ATM Agreement effective September 3, 2025.

January 2025 Offering

On January28,2025, the Company entered into a securities purchase agreement with certain institutional investors pursuant to which the Company sold, in a registered direct offering priced at-the-market under the rules of Nasdaq, an aggregate of51,079shares of common stock at a purchase price of $20.42 per share. The shares were offered pursuant to a “shelf” registration statement on Form S-3(Registration No.333-280796). In a concurrent private placement, the Company also issued to the investors unregistered warrants (the “January2025Warrants”) to purchase up to an aggregate of102,158 shares of common stock at an exercise price of $15.42 per share. The January2025Warrants are exercisable upon issuance, or January 30, 2025, and expire twenty-four months from the date of issuance, or January30,2027. The registered direct offering and concurrent private placement (together, the “January2025Offering”) closed on January30,2025, resulting in net proceeds to the Company of approximately $804,346, after deducting the placement agent fees and other offering expenses paid by the Company.

As compensation for acting as the placement agent for the January2025Offering, in addition to certain cash fees, the Company issued H.C. Wainwright & Co., LLC (the “Placement Agent”) warrants to purchase up to3,833shares of common stock at an exercise price of $25.53(the “January2025Agent Warrants”). The January2025Agent Warrants were exercisable upon issuance and expire twenty-four months from the date of issuance.

February 2025 Offering

On February5,2025, the Company entered into a securities purchase agreement with certain institutional investors pursuant to which the Company sold, in a registered direct offering priced at-the-market under the rules of Nasdaq, an aggregate of75,176 shares of the Company’s common stock at a purchase price of $14.30per share. In a concurrent private placement, the Company separately issued to the investors unregistered warrants to purchase up to an aggregate of75,176shares of common stock at an exercise price of $11.80 per share (the “February2025Warrants”). The February2025Warrants were immediately exercisable upon issuance and expire twenty-four months from the date of issuance. The registered direct offering and concurrent private placement (together, the “February2025Offering”) closed on February6,2025, resulting in net proceeds to the Company of approximately $908,627, after deducting the placement agent fees and other offering expenses paid by the Company.

As compensation for acting as the placement agent for the February2025Offering, in addition to certain cash fees, the Company issued the Placement Agent warrants to purchase up to5,640 shares of common stock at an exercise price of $17.88(the “February2025Agent Warrants”). The February2025Agent Warrants were exercisable upon issuance and expire twenty-four months from the date of issuance.

F-18

July 2025 Offering

On July 15, 2025, the Company entered into a securities purchase agreement with certain institutional investors pursuant to which the Company sold, in a registered direct offering (the “July 2025 Offering”),438,332units at an offering price of $7.60 per unit and219,569 pre-funded units at an offering price of $7.596 per pre-funded unit. Each unit consisted of (i) one share of common stock, (ii) one series A-1 warrant exercisable for one share of common stock (the “July 2025 A-1 Warrants”), and (iii) one series A-2 warrant exercisable for one share of common stock (the “July 2025 A-2 Warrants” and together with the July 2025 A-1 Warrants, the “July 2025 Warrants”).Each pre-funded unit consists of one pre-funded warrant exercisable for one share of common stock (the “July 2025 Pre-Funded Warrants”) and warrants identical to the July 2025 Warrants included in the units. The July 2025 Pre-Funded Warrants have an exercise price of $0.004per share, and were immediately exercisable beginning onJuly 16, 2025until exercised in full. The July 2025 A-1 Warrants have an exercise price of $7.60 per share and are exercisable beginning onJuly 16, 2025untilJuly 15, 2030. The July 2025 A-2 Warrants have an exercise price of $7.60 per share and are exercisable beginning onJuly 16, 2025untilJanuary 15, 2027.

As compensation for acting as the placement agent for the July 2025 Offering, the Company also issued to H.C. Wainwright & Co., LLC warrants (the “July 2025 Placement Agent Warrants”) to purchase up to49,342 shares of common stock. The July 2025 Placement Agent Warrants have an exercise price equal to $9.50 per share and are exercisable upon issuance, orJuly 16, 2025, and expirefive yearsfrom the date of issuance, orJuly 15, 2030.

The July 2025 Offering was made pursuant to the Company’s registration statement on Form S-1 (File No. 333-288550), which was declared effective by the Securities and Exchange Commission (the “SEC”) on July 15, 2025, and the final prospectus, which was filed with the SEC on July 16, 2025. The Offering closed on July 16, 2025, resulting in net proceeds to the Company of approximately $4,281,300, after deducting placement agent fees and other offering expenses paid by the Company.

2025 ATM Agreement

On September 5, 2025, the Company entered into an At-The-Market Sales Agreement (the “2025 ATM Agreement”) with H.C. Wainwright & Co., LLC (“Wainwright”) pursuant to which the Company may, from time to time, offer and sell shares of its common stock, having aggregate gross sales proceeds of up to $1,397,532(the “2025 ATM Offering”). As compensation for acting as the sales agent for the 2025 ATM Offering, Wainwright will be entitled to a commission of3.0% of the gross proceeds from sales of shares in the 2025 ATM Offering.

The common stock under the 2025 ATM Agreement was issued and sold pursuant to the Company’s shelf registration statement on Form S-3 and accompanying base prospectus (Registration Statement No. 333-280796), which was declared effective by the SEC on July 18, 2024, and a prospectus supplement dated September 5, 2025 relating to the offer and sale of the shares pursuant to the 2025 ATM Agreement. As ofDecember 31, 2025, 136,991 shares were issued under the 2025 ATM Agreement, resulting in net proceeds of $405,114, after deducting the placement agent fees and other offering expenses paid by the Company. See Note 12 – Subsequent Events.

Preferred Stock Conversions

During the years ended December 31, 2025 and 2024, the Company converted an aggregate of 0 and 2,323 shares of Series A Preferred Stock, respectively, held by Knight Therapeutics Inc. into 0 and 3,667 shares of common stock, respectively.

Warrant Exercises

During the year ended December 31, 2025, the Company issued 315,869 shares of common stock upon the exercise of315,869 pre-funded warrants, resulting in aggregate cash proceeds to the Company of $2,804. During the year ended December 31, 2024, the Company issued52,792 shares of common stock upon the exercise of52,792 pre-funded warrants, resulting in aggregate cash proceeds to the Company of $10,963.

Other Events

On April 1, 2024, the Company entered into an Amendment to the Debt Exchange Agreement with Trevally, LLC (“Trevally”), which amends the original agreement with Trevally (executed in January 2023). Pursuant to the Amendment, Trevally agreed to return 500 shares of the Company’s common stock, initially issued to Trevally in January 2023 as advance consideration for agreeing to complete the synthesis of research materials for the Company. Trevally returned the previously issued shares for no consideration on April 3, 2024. Trevally delivered the completed research materials to the Company on July 1, 2024.

F-19

Common Stock Warrants

As of December 31, 2025 and 2024, the Company accounts for all issued and outstanding warrants to purchase common stock as equity-classified instruments based on the guidance in ASC 480 and ASC 815.

September 2024 Private Placement

On September 4, 2024, the Company entered into a Securities Purchase Agreement with an institutional investor, agreeing to issue and sell in a private placement offering (the “Private Placement”) (i) pre-funded warrants to purchase 144,928 shares of common stock (the “September 2024 Pre-Funded Warrants”), (ii) series A warrants to purchase 144,928 shares of common stock (the “Series A Warrants”), and (iii) series B warrants to purchase 144,928 shares of common stock (the “Series B Warrants) at a price of $27.60 per Pre-Funded Warrant and accompanying Series A and Series B Warrants. The Private Placement closed on September 5, 2024, generating net proceeds to the Company of $3,414,502, after deducting placement agent fees and offering expenses.

The September 2024 Pre-Funded Warrants have an exercise price of $0.02 per share and were immediately exercisable on September 5, 2024 and may be exercised at any time until exercised in full. The Series A and Series B Warrants have an exercise price of $27.60 per share and were exercisable beginning on the effective date of stockholder approval to approve the issuance of the shares underlying the Series A and Series B Warrants and the September 2024 Agent Warrants, defined below, to comply with applicable listing rules and regulations of the Nasdaq Stock Market (“Stockholder Approval”), which was later received on November 6, 2024 (the “Stockholder Approval Date”). The Series A Warrants expire five years after the Stockholder Approval Date or November 6, 2029, and the Series B Warrants will expire 18 months after the Stockholder Approval Date, or May 6, 2026.

As compensation for acting as the placement agent for the Private Placement, the Company issued to H.C. Wainwright & Co., LLC warrants to purchase up to 10,870 shares of stock (the “September 2024 Agent Warrants”). The September 2024 Agent Warrants have substantially the same terms as the Series A Warrants, except that the September 2024 Agent Warrants have an exercise price equal to $34.50 per share.

The following table presents a summary of the activity for the Company’s equity-classified warrants during the year ended December 31, 2024:

Forfeited - - -

Expired - - -

F-20

During the year ended December 31, 2024, the Company received aggregate cash proceeds of $10,963upon the exercise of4,164January 2024 Pre-Funded Warrants and48,628September 2024 Pre-Funded Warrants.

The following table presents a summary of the activity for the Company’s equity-classified warrants during the year ended December 31, 2025:

Forfeited - - -

Expired - - -

During the year ended December 31, 2025, the Company received aggregate cash proceeds of $2,804 upon the exercise of 96,300 September 2024 Pre-Funded Warrants and 219,569 July 2025 Pre-Funded Warrants.

The following table summarizes the significant assumptions used in determining the fair value of equity classified warrants on the respective grant or reclassification dates for the years ended December 31, 2025 and 2024:

Expected dividend yield 0.00 % 0.00 %

Series A Preferred Stock

As described in Note 8, as a result of the completion of the IPO and as required under the terms of the Knight Debt Conversion Agreement, the Company converted the entirety of the accumulated interest on the Convertible Knight Loan as of March 31, 2022 into 80,965 shares of Series A Preferred Stock. During the years ended December 31, 2025 and 2024, the Company converted an aggregate of 0 and 2,323 shares of Series A Preferred Stock, respectively, into 0 and 3,667 shares of common stock, respectively, at the applicable conversion rate detailed below.

The holders of shares of Series A Preferred Stock have the rights, preferences, powers, restrictions and limitations as set forth below.

Voting Rights - The holders of shares of Series A Preferred Stock are not entitled to any voting rights.

F-21

Dividends - From and after the date of issuance of any share of Series A Preferred Stock, cumulative dividends shall accrue, whether or not declared by the Board and whether or not there are funds legally available for the payment of dividends, on a daily basis in arrears at the rate of 6.0% per annum on the sum of the Liquidation Value (as defined below). Accrued dividends shall be paid in cash only when, as and if declared by the Board out of funds legally available therefor or upon a liquidation or redemption of the Series A Preferred Stock. On March 31 of each calendar year, any accrued and unpaid dividends shall accumulate and compound on such date and are cumulative until paid or converted. Holders of shares of Series A Preferred Stock are entitled to receive accrued and accumulated dividends prior to and in preference to any dividend, distribution, or redemption on shares of Common Stock or any other class of securities that is designated as junior to the Series A Preferred Stock. During the year ended December 31, 2024, accrued dividends on outstanding shares of Series A Preferred Stock totaled $483,301. During the year ended December 31, 2025, dividends in the amount of $501,056 accrued on outstanding shares of Series A Preferred Stock. As of December 31, 2025, cumulative dividends on outstanding shares of Series A Preferred Stock amount to $1,205,071. To date, the Company has not declared or paid any dividends.

Liquidation Rights - In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of shares of Series A Preferred Stock then outstanding will share ratably in any distribution of the remaining assets and funds of the Company with all other stockholders as if each share of Series A Preferred Stock had been converted by the Company to Common Stock as described below.

Conversion Rights - The Company has the right, in its sole discretion, to convert all or any portion of the outstanding shares of Series A Preferred Stock (including any fraction of a share), plus the aggregate accrued or accumulated and unpaid dividends thereon into a number of shares of Common Stock determined by (i) multiplying the number of shares to be converted by $100 per share, as adjusted for any stock splits, stock dividends, recapitalizations or similar transactions with respect to the Series A Preferred Stock (but unchanged as a result of the Reverse Stock Splits impacting the common stock on August 12, 2024, February 24, 2025, and January 20, 2026) (the “Liquidation Value”), (ii) plus all accrued and accumulated and unpaid dividends on such shares to be converted, and then (ii) dividing the result by the then-effective Conversion Price in effect, provided that such conversion would not result in the holders of shares of Series A Preferred Stock owning more than 19.9% of the outstanding shares of common stock on an as-converted basis. The “Conversion Price” is equal to the lesser of (a) the Liquidation Value, (b) the offering price per share of Common Stock in the Company’s IPO, or $1,200 per share, as adjusted for the Reverse Stock Splits, or (c) the 10-day volume weighted average price per share of Common Stock, as reasonably determined by the Company.

7. DEBT

SBA COVID-19 EIDL

On May 14, 2020, the Company received COVID-19 EIDL lending from the Small Business Administration (SBA) in the amount of $150,000. The loan bears interest at an annual rate of 3.75% calculated on a monthly basis. Monthly payments of $731 were required beginning in November 2022, with a final balloon payment equal to the remaining principal due at the maturity date of October 12, 2050. The balance as of December 31, 2025 and 2024 is $152,775 and $155,891, respectively. The current maturity at December 31, 2025 is $8,772 and the long-term liability is $144,003 ($8,772 and $147,119 at December 31, 2024, respectively). The loan is collateralized by all tangible and intangible personal property of the Company. The Company is prohibited from accepting future advances under any superior liens on the collateral without the prior consent of SBA.

The current future payment obligations of the principal are as follows:

Period Principal Payments

F-22

8. DERIVATIVE LIABILITIES

In accordance with the provisions of ASC 815, derivative liabilities are initially measured at fair value at the commitment date and subsequently remeasured at each reporting period, with any increase or decrease in the fair value recorded in the results of operations within other income (expense), net as the change in fair value of derivative liabilities.

As of December 31, 2025 and 2024, derivative liabilities consist of the contingent milestone payment due to Knight Therapeutics, Inc. (“Knight”), a former lender of the Company, as required by the Debt Conversion Agreement executed between the Company and Knight on January 9, 2023, as subsequently amended (the “Knight Debt Conversion Agreement”). Key points of this agreement were as follows:

The Parties agreed to fix Knight’s cumulative debt to the value as it stood on March 31, 2022, which consisted of principal and accumulated interest. As a result of the completion of the IPO, the cumulative outstanding principal as of March 31, 2022 converted into 4,619 shares of common stock (representing 19.9% ownership of the Company’s common stock after giving effect to the IPO), and the entirety of the accumulated interest as of March 31, 2022 converted into 80,965 shares of Series A Preferred Stock, in full satisfaction of the Company’s obligations with respect to the outstanding principal and accumulated interest.

The Parties agreed that the Company will make a milestone payment of $10 million to Knight if, after the IPO, the Company sells ArakodaTM or if a Change of Control (as per the definition included in the original loan agreement dated on December 10, 2015) occurs, provided that the purchaser of ArakodaTM or individual or entity gaining control of the Borrower is not the Lender or an affiliate of the Lender.

For the period ending upon the earlier of (i) 10 years after the closing of the IPO, or (ii) the conversion or redemption in full of the Series A Preferred Stock, the Company will pay to Knight a royalty equal to 3.5% of the Company’s net sales (the “Royalty”) on a quarterly basis, where “Net Sales” has the same meaning as in the Company’s license agreement with the U.S. Army for tafenoquine.

Upon consummation of the IPO, the Company concluded that the contingent milestone payment is a freestanding financial instrument that meets the definition of a derivative under ASC 815, and accordingly, the fair value of the derivative liability is marked to market each reporting period until settled. The Royalty due to Knight was determined to be an embedded component of the Series A Preferred Stock, however, is exempt from derivative accounting under the ASC 815 scope exception for specified volumes of sales or service revenues. Therefore, the Company accrues a royalty expense as sales are made.

The Company uses a probability-weighted expected return method to determine the fair value of the contingent milestone payment. The valuation model uses significant unobservable inputs (Level 3), incorporating management’s assumptions regarding the timing and probability of discrete potential exit scenarios, forward interest rate curves, and a weighted average cost of capital based on implied and market yields to discount expected cash flows.

The valuation of the contingent milestone payment requires significant judgment and is sensitive to changes in assumptions related to the expected timing of payment, the likelihood of potential exit scenarios, and the selected discount rate. In developing these assumptions, management considers various qualitative and quantitative factors, including the anticipated progression toward clinical, commercial, and profitability milestones and the potential for a strategic transaction following achievement of each milestone. These factors are evaluated collectively to assess the probability‐weighted timing of the contingent payment under each potential exit scenario reflected in the valuation.As of December 31, 2025 and 2024, the discount rates applied in the valuation were 12.49% and 11.65%, respectively.

Changes in any of the assumptions used in the valuation could result in a materially different fair value measurement and, as a result, could lead to materially different gains or losses recognized in the Consolidated Statements of Operations and Comprehensive Loss upon recurring remeasurement.

A reconciliation of the beginning and ending balances for the derivative liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) is as follows for the year ended December 31, 2025:

Contingent Milestone Payment

Changes in the fair value of derivative liabilities are included as a component of other income (expense), net in the accompanying consolidated statements of operations and comprehensive loss. During the years ended December 31, 2025 and 2024, the Company recorded a net gain on the change in the fair value of derivative liabilities of $266,089 and $1,665,966, respectively.

F-23

9. INCOME TAXES

Loss before provision (benefit) for income taxes for the years ended December 31, 2025 and 2024 consisted of the following:

For the Year Ended December 31,

The components of the provision (benefit) for income taxes consisted of the following:

For the Year Ended December 31,

Current:

Federal $ - $ -

State - -

Foreign - -

Total current provision (benefit) - -

Deferred:

Federal - -

State - -

Foreign - -

Total deferred provision (benefit) - -

Total Benefit $ - $ -

The reconciliation between income taxes computed at the U.S. statutory income tax rate to the Company’s provision (benefit) for income taxes for the year ended December 31, 2025, after the adoption of ASU 2023-09, is as follows:

For the Year Ended December 31,

State income taxes, net of federal benefit - 0.0

Foreign tax effects

Australia

Change in valuation allowance 88,925 (1.2)

Non-taxable or non-deductible items (63,020) 0.9

Stock-based compensation 45,544 (0.6)

Other items - -

Benefit for Income Taxes $ - 0.0 %

The reconciliation between income taxes computed at the U.S. statutory income tax rate to the Company’s provision (benefit) for income taxes for the year ended December 31, 2024, before the adoption of ASU 2023-09, is as follows:

For the Year Ended December 31,

State income taxes, net of federal benefit (588,221) 7.4

Impact of non-U.S. earnings (22,103) 0.3

Other reconciling items, net 30,411 (0.4)

Benefit for Income Taxes $ - 0.00 %

F-24

Significant components of the Company’s deferred tax assets (liabilities) as of December 31, 2025 and 2024 are as follows:

As of December 31,

Deferred tax assets:

Other temporary differences 1,374 -

Total deferred tax assets, net of valuation allowance 45,517 68,769

Deferred tax liabilities:

Net deferred tax liabilities $ - $ -

The valuation allowance increased by $2,236,093 during 2025. In determining the need for a valuation allowance, the Company has given consideration to its worldwide cumulative loss position when assessing the weight of the sources of taxable income that can be used to support the realization of deferred tax assets. The Company has assessed, on a jurisdictional basis, the available means of recovering deferred tax assets, including the ability to carry-back net operating losses, the existence of reversing temporary differences, the availability of tax planning strategies and available sources of future taxable income. The Company has determined that it is more likely than not that the Company will not recognize the benefits of the U.S. Federal, state and net deferred tax assets, and, as a result, a full valuation allowance has been set against its net deferred tax assets as of December 31, 2025 and December 31, 2024.

At December 31, 2025, the Company had U.S. federal and state net operating loss carryforwards of approximately $17,028,834 and $17,026,834 respectively, and U.S. federal tax credits of $527,966. At December 31, 2024, the Company had U.S. federal and state net operating loss carryforwards of approximately $9,235,194 and $9,234,194 respectively, and U.S. federal tax credits of $437,296. The U.S. federal and state net operating losses carryforward indefinitely but may only be used to offset 80% of annual taxable income due to the Tax Cuts and Jobs Act. The U.S. federal tax credits begin to expire in 2042. The Company had $7,487,256 and $6,601,381 of foreign net operating loss carryforwards which carryforward indefinitely at December 31, 2025 and December 31, 2024, respectively.

Utilization of the NOL carryforwards may be subject to limitation under Section 382 of the Internal Revenue Code of 1986 due to ownership change limitations that have occurred previously or that could occur in the future. These ownership changes may limit the amount of NOL and interest limitation carryforwards that can be utilized annually to offset future taxable income and tax, respectively. There could be additional ownership changes in the future, which may result in additional limitations on the utilization of the NOL and tax credit carryforwards.

The Company conducts business globally and, as a result, it files income tax returns in U.S. federal and state jurisdictions and in Australia. In the normal course of business, the Company may be subject to examination by taxing authorities throughout the world. The tax years that remain subject to examination by major tax jurisdictions include the years ended December 31, 2022, 2023, 2024 and 2025. As of December 31, 2025, the Company is not under income tax examination in any jurisdiction.

During the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. The Company establishes reserves for tax-related uncertainties based on estimates of whether, and the extent to which, additional taxes will be due. These reserves are established when the Company believes that certain positions might be challenged despite its belief that its tax return positions are fully supportable. The Company adjusts these reserves in light of changing facts and circumstances, such as the outcome of tax examinations. As of December 31, 2025 and December 31, 2024, no reserves for uncertain tax positions have been established.

The Company recognizes interest and penalties accrued related to unrecognized tax benefits as income tax expense. During the years ended December 31, 2025 and December 31, 2024 the Company did not recognize interest and penalties related to unrecognized tax benefits.

F-25

10. SHARE-BASED COMPENSATION

The following is a summary of share-based compensation expenses reported in the Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2025 and 2024:

For the Year Ended December 31,

Research and Development $ - $ 3,227,300

Share-Based Compensation under 2022 Equity Incentive Plan

On November 22, 2022, the Company adopted the 2022 Equity Incentive Plan (the “2022 Plan”), which provides for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units and performance awards to eligible employees, directors and consultants, to be granted from time to time by the Board of Directors of the Company. The 2022 Plan provides for an automatic increase in the number of shares available for issuance beginning on January 1, 2023 and each January 1 thereafter, by 4% of the number of outstanding shares of common stock on the immediately preceding December 31, or such number of shares as determined by the Board of Directors. Additionally, on July 16, 2024, November 6, 2024, and October 8, 2025 the Company’s stockholders approved an increase to the number of shares available under the 2022 Plan by 20,834 shares, 25,000 shares, and 62,500 shares, respectively. As of December 31, 2025, the number of remaining shares available for issuance under the 2022 Plan is equal to 68,760.

Stock Options

The Company grants stock options to employees, non-employees, and Directors with exercise prices equal to the closing price of the underlying shares of the Company’s common stock on the Nasdaq Capital Market on the date that the options are granted. Options granted generally have a term of five to ten years from the grant date and are subject to vesting as determined in the individual award agreement. The Company estimates the fair value of stock options on the grant date by applying the Black-Scholes option pricing valuation model.

The following table summarizes the significant assumptions used in determining the fair value of options granted during the years ended December 31, 2025 and 2024:

Weighted-average grant date fair value $ 15.24 $ 35.12

Expected dividend yield 0.00 % 0.00 %

The following table summarizes the Company’s stock option activities during the year ended December 31, 2025:

Exercised - - - -

Forfeited - - - -

Expired - - - -

F-26

The following table summarizes the Company’s stock option activities during the year ended December 31, 2024:

Exercised - - - -

Forfeited - - - -

Expired - - - -

The aggregate intrinsic value in the tables above reflects the difference between the Company’s closing stock price on the last trading day of the period and the exercise price of the options, multiplied by the number of in-the-money stock options. The intrinsic value of stock options changes based on the price of the Company’s common stock.

On July 16, 2024, the effective date of shareholder approval to increase the number of shares available under the 2022 Plan, the Company determined that the grant date criteria (as defined in ASC 718) was met, and therefore granted 3,212 stock options to certain directors, executives, and non-employees, in accordance with the terms of the individuals’ employment or directors’ agreements, as applicable. On September 26, 2024, the Board of Directors approved the grant of an additional 1,042 stock options to an executive.

In December 2024, the Board approved the grant of a total of 30,000 stock options to two executives at a per share exercise price equal to the closing price of our common stock on January 2, 2025. On January 2, 2025, the Company determined that the grant date criteria (as defined in ASC 718) was met, and therefore granted of a total of 30,000 stock options to executives. On October 21, 2025, the Company’s Board of Directors approved the grant of 8,000 non-qualified stock options to each of the four directors (2,000 options per director) at a per share exercise price of $5.84. These stock options were fully vested on the date of grant and have a term of seven years.

For the year ended December 31, 2025, the Company recognized $279,873 of compensation expense related to stock option awards ($32,767 for the year ended December 31, 2024). No stock options were exercised, forfeited, or expired during the period presented. As of December 31, 2025, the Company had $415,553 of unrecognized share-based compensation expense related to unvested options that is expected to be recognized over a weighted-average period of approximately 3.00 years.

Annual Performance Bonus

In December 2024, the Board approved the payment of 2024 performance bonuses to executives of the Company. Each executive was provided the option of receiving up to $20,000 in cash, with the remainder paid in shares of common stock determined based on the closing market price on January 2, 2025. All shares issued are eligible for net settlement up to the maximum allowable amount according to the IRS of 22%. As the number of shares is variable, the Company determined this represents a liability for the fixed monetary amount that will be settled in shares. On January 20, 2025, the Company issued a total of 3,953 shares of common stock to the executives in settlement of the share-based portion of the 2024 performance bonuses. Approximately 688 shares were withheld to cover payroll tax withholdings. As of December 31, 2024, the share-based liability amounted to $121,544, which was presented as a component of Accounts Payable and Accrued Expenses on the accompanying Consolidated Balance Sheet.

Share-Based Payments to Vendors for Services

In 2023, the Company issued shares of common stock as share-based payments to certain vendors in exchange for services to be rendered to the Company in the future. For fully vested, nonforfeitable equity instruments that are granted at the date the Company and a nonemployee enter into an agreement for goods or services, the Company recognizes the fair value of the equity instruments as a prepaid asset on the grant date, as defined in ASC 718. The corresponding cost is expensed over the service period depending on the specific facts and circumstances of the agreement with the nonemployee. As of December 31, 2025, the unamortized balance of prepaid assets related to these share-based payments for which the grant date criteria has been met is $195,887, which is presented as a component of Prepaid and Other Assets on the accompanying Consolidated Balance Sheet. Of this amount, $66,177 will be recognized ratably over the remaining service period through May 15, 2026. The remaining $129,710 will be recognized as the related research and development services are provided, which the Company estimates will occur within one year.

The agreements with the nonemployees do not include any provisions to claw back the share-based payments in the event of nonperformance by the nonemployees. Subject to applicable federal and state securities laws, the nonemployees can sell the received equity instruments.

F-27

11. COMMITMENTS AND CONTINGENCIES

Operating Lease

The Company is a party to a single lease with CXI Corp for its office space located in Washington, DC, which was most recently renewed in December 2025 for an additional one-year term that expires on March 31, 2027. As the term of the office lease is 12 months, the lease is not recorded on the balance sheet. The Company recognizes lease expense on this lease as short-term lease costs. Operating lease costs, including short-term leases, were in the amount of $20,350 and $28,867 for the years ended December 31, 2025 and 2024, respectively.

Board of Directors

In November and December 2022, the Company signed agreements with four director nominees (Cheryl Xu, Paul Field, Charles Allen and Stephen Toovey) which came into effect on July 11, 2023, the date the Company’s Registration Statement was declared effective. Each director is entitled to receive cash compensation of $11,250 quarterly. In addition, the two non-audit committee chairs (Toovey, Field) will receive $1,250 per quarter and the audit committee chair (Allen) will receive an additional $2,000 per quarter. In addition, each director is entitled to receive annual equity-based compensation awards, with the amounts and terms to be determined by the Compensation Committee.

In November 2024, the Company paid each non-executive director an additional $20,000 of cash compensation in lieu of granting equity-based compensation awards for the year ended December 31, 2024.

In October 2025, the Company granted a total of 8,000 non-qualified stock options to each member of the Company’s Board of Directors (2,000 options per director) at a per share exercise price of $5.84.These stock options were fully vested on the date of grant and have a term of seven years.

Contingencies

The Company’s operations are subject to a variety of local and state regulations. Failure to comply with one or more of those regulations could result in fines, restrictions on its operations, or losses of permits that could result in the Company ceasing operations.

Contingent Compensation

Following the Company’s IPO and the conversion of the outstanding debt pursuant to the Knight Debt Conversion Agreement, as discussed in Note 8, the Company is obligated to pay Knight a contingent milestone payment of $10 million if the Company sells ArakodaTM or if a Change of Control occurs. The Company accounts for the contingent milestone payment as a derivative liability (See Note 8).

On July 15, 2015, the Company entered into the Exclusive License Agreement with the U.S. Army Medical Materiel Development Activity (the “U.S. Army”), which was subsequently amended (the “U.S. Army Agreement”), in which the Company obtained a license to develop and commercialize the licensed technology with respect to all therapeutic applications and uses excluding radical cure of symptomatic vivax malaria. The term of the U.S. Army Agreement will continue until the expiration of the last to expire of the patent application or valid claim of the licensed technology, or 20 years from the start date of the U.S. Army Agreement, unless terminated earlier by the parties. The Company must make a minimum annual royalty payment of 3% of Net Sales (as defined in the U.S. Army Agreement) for Net Sales less than $35 million, and 5% of Net Sales greater than $35 million, with US government sales excluded from the definition of Net Sales. In addition, the Company must pay fees upon the achievement of certain milestones. The Company accrues the minimum annual royalty when the related sales occur. The achievement of the remaining milestones under the U.S. Army Agreement are not considered probable and thus no accruals for the related milestone payments have been made.

On December 20, 2024, the Company entered into a Patent License Agreement with Tufts Medical Center (“Tufts MC”), pursuant to which the Company obtained a license to research and commercialize certain patent applications covering jointly developed inventions related to the use of tafenoquine for treatment and/or prevention of babesiosis. (the “Tufts MC Agreement”). The term of the Tufts MC Agreement will continue until the expiration or final abandonment of the last patent application or issued patent for the use of tafenoquine for treatment and/or prevention of babesiosis, unless terminated earlier by the parties. On the earlier of (x) the date of patent issuance or (y) the date of regulatory approval for the use of tafenoquine product in treatment of babesiosis, the Company must make royalty payments equal to 4% of Net Sales (as defined in the Tufts MC Agreement) of tafenoquine products sold in a format labeled for use in the treatment of babesiosis or 2% of Net Sales of tafenoquine products sold in a format not labeled for use in the treatment of babesiosis. In addition, for all sublicense revenue received by 60P from sales of sublicensed products, the Company must make payments equal to 20% of the revenue received by the Company for sales of tafenoquine products sold in a format labeled for use in the treatment of babesiosis or 10% of the revenue received for sales of tafenoquine that are sold in a format not labeled for use in the treatment of babesiosis. As of December 31, 2025, the royalty period has not commenced, thus no accruals have been made.

(e) Litigation, Claims and Assessments

From time to time, the Company may be involved in litigation relating to claims arising out of operations in the normal course of business. As of December 31, 2025, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of the Company’s operations.

F-28

12. SUBSEQUENT EVENTS

The Company has evaluated subsequent events through March 30, 2026, which is the date the consolidated financial statements were issued.

2025 ATM Agreement

Pursuant to the 2025 ATM Agreement described in Note 6, between January 1, 2026 and January 22, 2026, the Company sold an aggregate of 418,602 shares at a weighted average price per share of $2.07, generating net proceeds to the Company of $834,705, after deducting commissions and certain other offering expenses.

1:4 Reverse Stock Split

On January 14, 2026, the Company filed an amendment to its Certificate of Incorporation with the Secretary of State of Delaware to effect the 1:4 Reverse Stock Split. On January 20, 2026, the Company effected the 1:4 Reverse Stock Split of its common stock, and our common stock began trading on The Nasdaq Capital Market on a split adjusted basis. See Notes 2 and 6 for further details.

The Company’s stockholders approved a reverse stock split at a ratio ranging from 1:3 to 1:10 at the 2025 Annual Stockholders Meeting on October 8, 2025, and subsequently on December 17, 2025, the Company’s Board of Directors approved the implementation of the reverse stock split at a ratio of 1:4.

As of the effective time of the 1:4 Reverse Stock Split, every four (4) issued and outstanding shares of the Company’s common stock were automatically combined and converted into one (1) issued and outstanding share of the Company’s common stock, reducing the number of shares of common stock outstanding from 5,436,441 shares to 1,359,091 shares. The 1:4 Reverse Stock Split did not change the authorized number of shares of common stock or preferred stock. Proportional adjustments were made to the number of shares of common stock issuable upon exercise or conversion of the Company’s equity awards, warrants, and other equity instruments convertible into common stock, as well as the respective exercise prices, if applicable in accordance with the terms of the instruments. No fractional shares of common stock were issued in connection with the 1:4 Reverse Stock Split. All fractional shares were rounded up to the nearest whole share with respect to outstanding shares of common stock.

Unless otherwise noted, all references to numbers of shares of the Company’s common stock and per share information presented in these consolidated financial statements have been retroactively adjusted, as appropriate, to reflect the 1:4 Reverse Stock Split (as well as the 1:5 Reverse Stock Split in February 2025 and the 1:12 Reverse Stock Split in August 2024), including reclassifying an amount equal to the reduction in par value of common stock to additional paid-in capital.

Nasdaq Delisting Notice

On January 20, 2026, the Company received a written notice from the Nasdaq Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that Nasdaq staff has determined to delist the Company’s common stock and warrants from The Nasdaq Capital Market because the Company’s common stock failed to maintain a minimum bid price of $1.00 per share for 30 consecutive business days, in violation of Nasdaq Listing Rule 5550(a)(2). The Company paid the $20,000 for the hearing fee and requested an appeal with Nasdaq, pursuant to the Notice, which stayed the suspension of trading and the filing of the Form 25-NSE pending the Panel’s decision.

On February 11, 2026, the Company was notified by Nasdaq that the Company regained compliance with the minimum bid price requirement set forth in Nasdaq Listing Rule 5550(a)(2) and that the Company is therefore in compliance with the Nasdaq Capital Market’s listing requirements. As a result, the hearing before the Nasdaq Hearings Panel that had been scheduled for February 19, 2026, has been cancelled, and this matter was closed. The Company’s common stock will continue to be listed and traded on The Nasdaq Capital Market.

March 2026 ATM Agreement

On March 2, 2026, the Company filed a prospectus supplement pursuant to Rule 424(b)(5) (the “2026 ATM Prospectus Supplement”) in connection with the Company’s At-The-Market Offering Agreement, with H.C. Wainwright & Co., LLC (“Wainwright”), pursuant to which the Company may, from time to time, offer and sell additional shares of its common stock having aggregate sales proceeds of up to $1,308,000 (the “2026 ATM Prospectus Supplement ”). The 2026 ATM Prospectus Supplement was subsequently amended on March 11, 2026, to increase the maximum aggregate offering price under the 2026 ATM Offering by $981,000 (the “2026 ATM Prospectus Supplement Amendment,” and together with the 2026 ATM Prospectus Supplement the “2026 ATM Offering”).

As compensation for acting as the sales agent for the 2026 ATM Offering, Wainwright is entitled to a commission of 3.0% of the gross proceeds from the sales of shares in the 2026 ATM Offering.

The common stock that may be sold pursuant to the 2026 ATM Prospectus Supplement will be issued and sold pursuant to the Company’s shelf registration statement on Form S-3 and accompanying base prospectus (Registration Statement No. 333-280796), which was declared effective by the SEC on July 18, 2024, and the 2026 ATM Prospectus Supplement relating to the offer and sale of the shares pursuant to the 2025 ATM Agreement.

Between March 2, 2026 and March 25, 2026, the Company sold an aggregate of 1,055,106 shares at a weighted average price per share of $2.49 generating net proceeds to the Company of $2,545,297, after deducting commissions and certain other offering expenses.

There have been no other events or transactions during this time which would have a material effect on these consolidated financial statements.

F-29

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

Item 9A. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Disclosure controls and procedures are controls and other procedures designed to ensure that the information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2025. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective in ensuring that information required to be disclosed by us in reports that we file or submit under the Exchange Act, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles (GAAP). As of December 31, 2025, our management conducted an assessment of the effectiveness of our internal control over financial reporting based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013 Framework).

Based on this assessment, our management concluded that our internal control over financial reporting was not effective as of December 31, 2025, due to the existence of material weaknesses in our internal control over financial reporting. These material weaknesses are described below:

Management has undertaken a remediation plan to address these material weaknesses. During the year ended December 31, 2025, we continued to enhance our internal control over financial reporting through various initiatives, including investing in information technology systems, enhancing the organizational structure, providing guidance and training to employees and further developing detailed policies and procedures.

We expect to remediate these material weaknesses in the first half of 2026. However, there may be additional material weaknesses identified that could require additional time and resources to remediate. We remain committed to ensuring that our internal control over financial reporting is designed and operating effectively.

SXTP US Equity

SXTP · 10-K · period ended 2025-12-31

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

Item 8. Financial Statements and Supplementary Data.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

Item 9A. Controls and Procedures.

SXTP US Equity☆

SXTP · 10-K · period ended 2025-12-31

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

Item 8. Financial Statements and Supplementary Data.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

Item 9A. Controls and Procedures.

SXTP US Equity