MDCX 10-K & 10-Q changes, risk factors and insider trading

An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with theall other information contained in this annual report, including the financial statements, before making aan decisioninvestment to invest in our securities.decision. If any of the following eventsrisks actually occur, our business, financial condition and operating results mayof operations could be materially and adversely affected. In that event, the trading price of our securities could decline, and you couldmay lose allpart or partall of your investment. This annual report also contains forward-looking information that involves risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of many factors, including the risks described below and elsewhere in this annual report.

The ProductProducts isare at an early stage of development, with uncertain market acceptance. Product approval, should this be achieved, does not infer that the ProductProducts will garner a good market price or be reimbursed by public or private insurers. Further, there are no guarantees that the ProductProducts will be positively received by the target patient population. The acceptability of the ProductProducts to regulators, payors and patients will depend on the relative risk versus benefit of the ProductProducts as proven in clinical trials, the acceptability of the price, and the relative attractiveness as compared to other treatments.

We could also suffer the consequences of non-compliance or breaches by licensors in connection with any license agreements we may enter into in the future. Such non-compliance or breaches by such third parties could in turn result in breaches or defaults under any agreements with other collaboration partners, and we could be found liable for damages or lose certain rights, including rights to develop and/or commercialize the Product.Products. Loss of our rights to any license granted to us in the future, or the exclusivity rights provided therein, could harm our financial condition and operating results.

The License Agreement is our main asset and the basis for the development of the Product.SkinJectTM. The University of Pittsburgh of the Commonwealth System of Higher Education (the "University of Pittsburgh") has the right to terminate the License Agreement if breaches are not cured within 30 days of our receipt of notice thereof from the University of Pittsburgh or in certain insolvency-related situations or if we cease to carry out our business. There can be no assurance that we will be able to comply with the License Agreement going forward or that the University of Pittsburgh will grant any necessary waivers if we are unable to do so. The obligations under the License Agreement principally require the trial of the ProductSkinJectTM on specified timelines. If the University of Pittsburgh were to terminate the License Agreement our assets would essentially be rendered worthless and it would have a material adverse effect on our ability to pursue our business objective.

OurCertain of our intellectual property is held under third-party licenses.

OurCertain of our intellectual property is held under a third-party license and we may require additional third-party licenses to effectively develop and manufacture our key products or future technologies. There can be no assurance as to the availability or cost of such additional licenses. A substantial number of patents have already been issued to other biotechnology and pharmaceutical companies. To the extent that valid third-party patent rights cover our products or services, we or our strategic collaborators would be required to seek licenses from the holders of these patents in order to manufacture, use or sell these products and services, and payments under them would reduce our profits from these products and services. It is not possible to predict the extent to which we may wish or be required to acquire rights under such patents, the availability and cost of acquiring such rights, and whether a license to such patents will be available on acceptable terms or at all. There may be patents in the United States or in foreign countries or patents issued in the future that are unavailable to license on acceptable terms. Our inability to obtain such licenses may hinder or eliminate an ability to manufacture and market products.

Although the SkinJect Phase 1 study indicated that the patch is well-tolerated, there is no guarantee that the Phase 2 study will produce similar results or that the ProductSkinJectTM will ultimately be brought to market or, if it does, that it will be positively received or obtain favorable pricing, which would have a material adverse effect on our results of operations. In addition, there is no guarantee that the open and planned Phase 2b studies involving Teverelix will be successfully or that Teverelix will ultimately be brought to market, or, if it does, that it will be positively received or obtain favorable pricing, which would have a material adverse effect on our business plans and results of operations.

There is substantialSubstantial doubt exists about the Company's ability to continue as a going concern and if the Company is unable to obtain additional financing from outside sources and/or eventually generate enough revenues, it may be forced to curtail or discontinue its operations.

The Company's current auditor has indicated in its report accompanying the Company's audited annual financial statements that there is substantial doubt exists about the Company's ability to continue as a going concern. The Company is in the preliminary stages of its planned operations and has not yet determined whether its processes and business plans are economically viable. The continued operations of the Company and the recoverability of amounts shown for certain operational expenses in the Company's audited annual financial statements are dependent upon the ability of the Company to obtain sufficient financing to commercialize its product and to become profitable, all of which are uncertain. Importantly, the inclusion in the Company's financial statements of a going concern opinion may negatively impact the Company's ability to raise future financing and achieve future revenue. If the Company is unable to obtain additional financing from outside sources and/or eventually generate enough revenues, the Company may be forced to cut costs, by among other things, curtailing or discontinuing its operations. These measures could cause significant delays or entirely prevent the Company’sCompany's continued efforts to commercialize its current or future products, which are critical to the realization of its business plan and the future operations of the Company. If any of these events happens, the Company’sCompany's investors could lose all or partspart of their investments. In addition, the Company’sCompany's financial statements do not include any adjustments that may be necessary should the Company be unable to continue as a going concern.

Market authorization of the ProductProducts falls under the regulatory purview of the FDA and other equivalent regulatory bodies worldwide. There can be no assurance that these regulatory bodies will approve the ProductProducts in the manner or time frame suggested. Although we intend to work with regulatory consultants and third parties knowledgeable in the area, we cannot ensure that the ProductProducts will obtain market authorization in a timely manner, or at all. Market authorization may also be contingent on a less competitive product label, which would negatively impact revenue.

As the ProductProducts isare developed through further clinical trials towards approval and commercialization, it is common that various aspects of the development program, such as manufacturing methods and formulation, are altered along the way in an effort to optimize processes and results. Such changes carry the risk that they will not achieve these intended objectives. Any of these changes could cause the ProductProducts to perform differently and affect the results of future clinical trials conducted with the altered materials. This could delay completion of clinical trials, require the conduct of bridging clinical trials or the repetition of one or more clinical trials, increase clinical trial costs, delay approval of the ProductProducts and jeopardize our ability, or our strategic partners' ability, to commence product sales and generate revenue.

The manufacture of the ProductProducts is complex. We or our third-party manufacturers may encounter difficulties in production. If we encountersencounter any such difficulties, our ability to supply the ProductProducts for clinical trials or, if approved, for commercial sale could be delayed or halted entirely.

The manufacture of biopharmaceutical products is complex and requires significant expertise and capital investment, including the development of advanced manufacturing techniques and process controls. The processprocesses of manufacturing the ProductProducts isare susceptible to product loss due to contamination, equipment failure or improper installation or operation of equipment, vendor or operator error, contamination and inconsistency in yields, variability in product characteristics and difficulties in scaling the production process. Even minor deviations from normal manufacturing processes could result in reduced production yields, product defects and other supply disruptions. If microbial, viral or other contaminations are discovered in the ProductProducts or in the manufacturing facilities in which the ProductProducts isare made, such manufacturing facilities may need to be closed for an extended period of time to investigate and remedy the contamination. Any adverse developments affecting manufacturing operations for the Product,Products, if any are approved, may result in shipment delays, inventory shortages, lot failures, product withdrawals or recalls, or other interruptions in the supply of our products. We may also have to take inventory write-offs and incur other charges and expenses for products that fail to meet specifications, undertake costly remediation efforts or seek more costly manufacturing alternatives.

If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell the Product,Products, if approved, we may be unable to generate any product revenue.

To successfully commercialize the Product,Products, we will need to build out sales and marketing capabilities, either on our own or with others. The establishment and development of our own commercial team or the establishment of a contract field force to market the ProductProducts will be expensive and time-consuming and could delay launch. Moreover, we cannot be certain that we will be able to successfully develop this capability. We may seek to enter into collaborations with other entities to use their established marketing and distribution capabilities, but we may be unable to enter into such agreements on favorable terms, if at all. If any current or future collaborators do not commit sufficient resources to commercialize the Product,Products, or we are unable to develop the necessary capabilities on our own, we may be unable to generate sufficient revenue to sustain our business. We may compete with many companies that currently have extensive, experienced and well-funded marketing and sales operations to recruit, hire, train and retain marketing and sales personnel. Without an internal team or the support of a third party to perform marketing and sales functions, we may be unable to compete successfully against these more established companies.

Our success depends in large measure on certain key personnel, including our chairman & chief executive officer, Dr. Raza Bokhari. The loss of the services of such key personnel could have a material adverse effect on us. The contributions of these individuals to our operations have been, and are expected to continue to be, of central importance. In addition, the competition for qualified personnel in the biotech industry is intense and there can be no assurance that we will be able to continue to attract and retain all personnel necessary for the development and operation of our business. Investors must rely upon the ability, expertise, judgment, discretion, integrity and good faith of oursour management. Other biotechnology companies with which we compete for qualified personnel have greater financial and other resources, different risk profiles and a longer history in the industry than we do. They also may provide more diverse opportunities and better chances for career advancement. Some of these characteristics may be more appealing to high-quality candidates than those that we have to offer. If we are unable to continue to attract and retain high-quality personnel, the rate of and success with which we can develop and commercialize the ProductProducts would be limited.

SkinJect also has or may have relationships with scientific collaborators at academic and other institutions, some of whom conduct research at SkinJect's request or assist SkinJect in formulating the SkinJect's research and development strategies. These scientific collaborators are not SkinJect employees and may have commitments to, or consulting or advisory contracts with, other entities that may limit their availability to us. In addition, even though SkinJect's collaborators are required to sign confidentiality agreements prior to working, they may have arrangements with other companies to assist such other companies in developing technologies that may prove competitive to us.

The ongoing volatility in global capital markets has generally made the raising of capital by equity or debt financing more difficult. Access to financing has been negatively impacted by ongoing global economic risks and increased inflation. We will require substantial additional funds for further research and development, and the marketing and sale of our technology. We may attempt to raise additional funds for these purposes through public or private equity or debt financing, collaborations with other therapeutic companies, government grants or other sources. There can be no assurance that additional funding or partnerships will be available on terms acceptable to us and which would foster the successful commercialization of the Product.Products. If additional funds are raised through further issuances of equity or convertible debt securities, existing shareholders could suffer significant dilution, and any new equity securities issued could have rights, preferences and privileges superior to those of the common shares or terms superior to those of the Warrants.existing warrants. Any debt financing secured in the future could involve restrictive covenants relating to capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital or to pursue business opportunities, including potential acquisitions. If adequate funds are not obtained, we may be required to reduce, curtail or discontinue operations.

We have had negative cash flow from operating activities and hashave incurred operating losses since its inception. We anticipate that we will continue to incur losses for the foreseeable future, and we expect these losses to increase as we continue our research and development of, and seek regulatory approvals for, our product candidates, prepare for and begin to commercialize any approved product candidates and add infrastructure and personnel to support our product development efforts and operations as a public company. The net losses and negative cash flows incurred to date, together with expected future losses, have had, and likely will continue to have, an adverse effect on our shareholders' deficit and working capital. As of December 31, 2024,2025, we had an accumulated deficit of approximately US$28.9$64.3 million.million, which was comprised of approximately $12.4 million of accumulated deficit of SkinJect as of September 30, 2023, the day after it became a subsidiary of the Company, and approximately $51.9 million of deficit accumulated by the Company on a consolidated basis). The amount of future net losses will depend, in part, on the rate of future growth of our expenses and our ability to generate revenue.

We are engaged in an industry that is highly competitive, evolving and characterized by technological change. As a result, it is difficult for us to predict whether, when and by whom new competing technologies or new competitors may enter the market. We face competition from companies with strong positions in certain markets we are currently targeting, and in new markets and regions we may enter. Some of these companies have significantly greater financial, technical, human, research and development, and marketing resources than us. We cannot assure that we will be able to compete effectively against current and future competitors who may discover and develop products in advance of us that are more effective than those developed by us. As a consequence, our current and future technologies may become obsolete or uncompetitive, resulting in adverse effects on revenue, margins and profitability. In addition, competition or other competitive pressures may result in price reductions, reduced margins or loss of market share, any of which could have a material adverse effect on our business, financial condition or results of operations. To the extent that new or improved pharmaceutical drug treatments are introduced that demonstrate better long-term efficacy and safety, patients and physicians may further delay the introduction of patches, such as the Product,SkinJectTM, if approved, in the non-melanoma skin cancer treatment continuum.continuum or delay the Productuse of Teverelix for the treatment of for the treatment of cardiovascular high-risk prostate cancer patients and patients with first AUR episodes due to an enlarged prostate. SkinJectTM could also face competition from other formulations or devices that deliver chemotherapeutic agents on an extended basis.

Many of our competitors have substantially greater financial, technical and other resources, such as larger research and development staffs and experienced commercial and manufacturing organizations. Mergers and acquisitions in the biotechnology and pharmaceutical industries may result in even more resources being concentrated in competitors. As a result, these companies may obtain regulatory approval more rapidly than uswe are able and may be more effective in selling and marketing their products as well. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large, established companies. Competition may increase further as a result of advances in the commercial applicability of technologies and greater availability of capital for investment in these industries. Our competitors may succeed in developing, acquiring or licensing on an exclusive basis drug products or drug delivery technologies that are more effective or less costly than the Product.Products.

• the usefulness, ease of use, performance and reliability of our technology compared to our competitors;

• the activity and tolerability of the Product,Products, including relative to marketed products and product candidates in development by third parties;

• the ability to distinguish safety and efficacy from existing, alternative therapies;

• the timing for the ProductProducts to complete clinical development and receive market approval;

• acceptance of the ProductProducts by patients, physicians and other health providers,providers;

• our ability to monetize our technology;

• the selection of licensing partners for our technology with the necessary skills and resources to drive uptake;

• our marketing and selling efforts;

• our financial condition and results of operations;

• the ability to maintain a good relationship with regulatory authorities;

• the price of our future products, including in comparison to branded or generic competitors;

• whether coverage and adequate levels of reimbursement are available under private and governmental health insurance plans,plans;

• acquisitions or consolidations within our industry, which may result in more formidable competitors;

•our ability to protect our intellectual property rights, our ability to attract, retain and motivate talented employees;

•our ability to cost-effectively manage and grow our operations; and our reputation and brand strength relative to that of our competitors.

Our future success will depend on our ability to continually enhance and develop the Product.Products.

There is a broad pipeline of potential new therapies forthat skinmay cancer.compete with the Products. The market is characterized by rapid technological change and the possibility of frequent new product introductions. Accordingly, our future success depends upon our ability to enhance the ProductProducts and to develop, introduce and sell the most accurate products at competitive prices. The development of new technologies and products involves time, substantial costs and risks. Our ability to successfully develop new technologies depends in large measure on our ability to maintain a technically skilled research and development staff and to adapt to technological changes and advances in the industry.

If we are unable to differentiate the ProductSkinJectTM from existing therapies for treatment of skin cancer,cancer or Teverelix from therapies for high cardiovascular risk advanced prostate cancer patients or from treatment of recurrent AUR ("AURr") episodes, or if the FDA or other applicable regulatory authorities approve generic products that compete with the Product,Products, the ability to successfully commercialize the ProductProducts would be adversely affected.

Although the Phase 1 study provides preliminary evidence of complete clinical response, itIt is possible that we will receive data from additional clinical trials in respect of either or both of SkinJectTM and Teverelix, or in a post marketing setting from physician and patient experiences with the commercial productproducts, that does not continue to support such interpretations. It is also possible that the FDA, physicians and healthcare payers will not agree with our interpretation of existing and future clinical trial data. If we are unable to demonstrate the value of the ProductProducts based on clinical data, patient experience, as well as real world evidence, the opportunity for the ProductProducts to maintain premium pricing and be commercialized successfully would be adversely affected.

Additionally, the FDA or other applicable regulatory authorities may approve other generic products that could compete with the ProductProducts if we cannot adequately protect it with our patent portfolio. For example, in the US,United States, once an NDA is approved, the product covered thereby becomes a "listed drug" which can, in turn, be cited by potential competitors in support of approval of an abbreviated new drug application ("ANDA"). The Federal Food, Drug, and Cosmetic Act (the "FDCA"), FDA regulations and other applicable regulations and policies provide incentives to manufacturers to create modified, non-infringing versions of a drug to facilitate the approval of an ANDA or other application for generic substitutes. These manufacturers might only be required to conduct a relatively inexpensive study to show that their product has the same active ingredient(s), dosage form, strength, route of administration, conditions of use, or labeling as our product candidate and that the generic product is bioequivalent to us, meaning it is absorbed in the body at the same rate and to the same extent as the Product.Products. These generic equivalents, which must meet the same quality standards as branded pharmaceuticals, would be significantly less costly than ours to bring to market and companies that produce generic equivalents are generally able to offer their products at lower prices. Thus, after the introduction of a generic competitor, a significant percentage of the sales of any branded product is typically lost to the generic product. Accordingly, competition from generic equivalents to our products would materially adversely impact our ability to successfully commercialize the Product.Products.

We may enter into agreements with third parties for the development and commercialization of the ProductProducts in international markets. If we do so, we would be subject to additional risks related to entering into international business relationships, including:

● differing regulatory requirements in other countries including, among others, marketing approval, pricing, reimbursement and sales and marketing practices;

● potentially reduced protection for intellectual property rights;

● potential for so-called parallel importing, which is when a local seller, faced with higher local prices, opts to import goods from a foreign market with lower prices, rather than buying them locally;

● unexpected changes in tariffs, trade barriers and regulatory requirements, including the imposition of new tariffs by the U.S. government on imports to the U.S. and/or the imposition of retaliatory tariffs by foreign countries;

● economic weakness, including inflation, or political instability in foreign economies and markets;

● compliance with tax, employment, immigration and labor laws for employees traveling and working abroad;

● foreign taxes;

● foreign currency fluctuations, which could result in increased operating expenses and reduced revenues, and other risks incident to doing business in another country;

● workforce uncertainty in countries where labor unrest is more common than in Canada or the United States;

●production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad or supply chain disruptions; and business interruptions resulting from geo-political actions, including war and terrorism, or natural disasters, including earthquakes, volcanoes, typhoons, floods, tsunamis, hurricanes and fires.

We may seek future partnerships, collaborations and other strategic transactions to maximize the commercial potential of the Product.Products. We may enter into such arrangements on a selective basis depending on the merits of retaining commercialization rights for ourself as compared to entering into selective collaboration arrangements with leading pharmaceutical or biotechnology companies, both in the United States and internationally. We face competition in seeking appropriate collaborators. Moreover, collaboration arrangements are complex and time consuming to negotiate, document and implement. We may not be successful in our efforts to establish and implement collaborations or other alternative arrangements should we choose to enter into such arrangements. The terms of any collaborations or other arrangements that we may establish may not be favorable to us.

We have and may in the future acquire businesses or products, or form strategic alliances in the future, and we may not realize the benefits of such acquisitions or alliances.

This discussion contains forward-looking statements that involve risks and uncertainties. When reviewing the discussion below, you should keep in mind the substantial risks and uncertainties that impact our business. In particular, we encourage you to review the risks and uncertainties described in "Risk Factors" in Part I, Item 1A in this Annual Report on Form 10-K. These risks and uncertainties could cause actual results to differ materially from those projected or implied by our forward-looking statements contained in this report. These forward-looking statements are made as of the date of this annual report, and we do not intend, and do not assume any obligation, to update these forward-looking statements, except as required by law. All amounts are expressed in United States dollars unless otherwise stated. This discussion should be read in conjunction with the Company's audited consolidated financial statements for the years ended December 31, 2025 and 2024.

The Company is a clinical stage, multi-strategy holdingbiotech/life sciences company focused on investing in and accelerating novel life sciences and bio-technology companies through FDA approved clinical trials. Utilizing a thesis driven collaborative process, the Company attempts to acquire and advance clinical stage assets through clinical development programs of novel and commercialization.potentially disruptive therapeutic assets. The Company looks into opportunities across all therapeutics areas where an unmet need exists for improved patient safety and efficacy. The Company is activelyopportunistically exploring to expand its drug development pipeline through qualified and accretive acquisitions and partnerships.

The Company has two wholly owned subsidiaries, Medicus Pharma Inc., a company incorporated in the state of Delaware on October 12, 2023, and SkinJect,SkinJect. Inc.The ("SkinJect").Company also has one non-wholly owned subsidiary, Antev, of which it owns 98.6% of the issued and outstanding shares.

SkinJect is focused on the development of a novel drug"innovation deliverycombination systemproduct", as an investigational new drug, using uniquely designed, patent protected dissolvable microneedle arrays ("MNAsC-MNAs") and doxorubicin containing dissolvable microneedle arrays ("D-MNAs") for the treatment of certain skin cancers. To that end, the Company licensed certain technology co-developed by the University of Pittsburgh and Carnegie Mellon University. The Company established and validated fabrication processes relative to the MNAs,C-MNAs and D-MNAs, completed pre-clinical testing and secured approval to proceed with clinical trials activity from the Food and Drug Administration.FDA.

The Company then completed a dose escalation study ("'SKNJCT-001SKNJCT-001") that assessed the safety of MNAD-MNA patch in patients with BCC. There were no serious systemic or local adverse events nor any demonstrated alterations in any clinical measurements during the trial. The conclusion of the study was that MNAD-MNA patch was well tolerated with no evidence of dose limiting toxicity.

The Company had initiated a clinical study ("SKNJCT-002") aimed at evaluating clinical efficacy. The first part involved the enrollment of 15 healthy volunteers and was designed to study the penetration of placebo-containingdevice only-containing Dynamic Mechanical Allodynia ("DMA") patches at five different anatomic locations. After the first seven health volunteers were enrolled, due to the variability of array application observed by the investigator, SkinJect made the decision to pause the trial. The study was never resumed, and it was ultimately closed without further enrollment. There were no adverse events reported in the enrolled subjects.

In January 2024, the Company submitted the clinical design for a randomized, double-blinded, placebo-controlledthree arm study evaluating two dose levels of microneedle-mediated delivery of doxorubicin ("P-MNA"D-MNA), compared with a device-only control (C-MNA) in patients with nodular type of basal cell carcinoma (nBCC). It was a multi-center study ("SKNJCT-003") enrolling up to 60 subjects presenting with nodular type of BCC of the skin. The FDA responded in March 2024 and requested additional clinical information. A final protocol was submitted to the FDA in July 2024, which included the information requested by the FDA, along with updated CMC, stability and sterility data. On July 31, 2024, the FDA responded to the latest submission and requested certain additional information and clarification. The Company has responded to the FDA on August 2, 2024.2024 Onand commenced patient recruitment on August 13, 2024, the Company commenced activating its clinical trial sites and had enrolled over 25% of the 60 expected patients by December27, 2024.

After the completion of the Share Consolidation, the number of the Company's issued and outstanding common shares decreased from 21,693,560 to 10,846,721. The par value of the Company's common shares remains unchanged at $nil$0 per share after the Share Consolidation. The Share Consolidation was completed in preparation for a U.S. listing.

On November 14, 2024, the Company completed its initial public offering with the sale of 970,000 Units,Units at the price of $4.125 per Unit, with each Unit (the "Unit") consisting of one common share and one warrantPublic toWarrant. purchaseThe onePublic commonWarrants shareexpire atfive theyears pricefrom their date of $4.125issuance peron Unit.November 15, 2029. In addition, the underwriters exercised an option to purchase 145,500 warrantsPublic Warrants (the "Overallotment Warrants") at a price of $0.01 per warrant.

Total gross proceeds from theour IPOinitial public offering were $4,002,705,$4.0 million, including the proceeds from the Overallotment Warrants. The Company incurred total issuance costs of $2,128,014,$2.1 million, including underwriter fees, and legal and other professional fees incurred directly related to the issuance. As of December 31, 2025, 129,905 Warrants issued as part of the IPO have been exercised for cash for proceeds to the Company of $602,756 during the year ended December 31, 2025.

On March 10, 2025, the Company completed an offering (the "Regulation A Offering") of 1,490,000 units at $2.80 per unit pursuant to Tier II of Regulation A under the Securities Act, with each unit consisting of one common share and one warrant to(each, purchasea one"Regulation commonA share.Warrant"). The warrantsRegulation A Warrants have an exercise price of $2.80 and expire on March 10, 2030. The aggregate gross proceeds to the Company from the Regulation A Offering were $4,172,000.$4.2 million. As of December 31, 2025, 1,473,800 of the 1,490,000 Regulation A Warrants have been exercised for cash, for proceeds to the Company of $4,126,639 during the year ended December 31, 2025.

Research and development ("R&D") costs include costs incurred under agreements with third-party contract research organizations, contract manufacturing organizations and other third parties that conduct preclinical and clinical activities on our behalf and manufacture our product candidates, and other costs associated with our R&D programs, including laboratory materials and supplies.

R&D expenses increased by $3,334,280$4,193,650 or 1722%118.9% for the year ended December 31, 2024,2025, compared to the equivalent periods in the prior year. This increase is primarily due to costs incurred related to SKNJCT-003SKNJCT-003, SKNJCT-004 and $308,828Teverelix, ofwhich stock-basedhad compensationincreased recognizedclinical withintrial R&Dactivity expenses forin the yearcurrent ended December 31, 2024 (2023 - $0).year.

We expect our R&D expenses to increase substantially for the foreseeable future as we continue with the SKNJCT-003 study and trials.trials of Skinject and Teverelix.

FinanceOther income (incomeexpense) expense, net

We are a clinical stage development companycompany, and we currently do not earn any revenues from our preclinicaldrug development programs and are therefore considered to be in the R&D stage. As required, the Company will continue to finance its operations through the sale of equity or pursue non-dilutive funding sources available to the Company in the future. The continuation of our R&D activities is dependent on our ability to obtain financing.

The Company expects to continue to incur significant operating losses for the foreseeable future and may never become profitable. In addition to the ATM, SEPA and Debenture (as defined below), management believes that the Company has access to additional capital resources through public and/or private equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements. However, ifit is possible that the Company may not be able to obtain financing on acceptable terms, or at all, and the Company may not be able to enter into strategic alliances or other arrangements on favorable terms, or at all. Further, the terms of any financing may adversely affect the holdings or the rights of the Company’s shareholders. If the Company is unable to secure additional capital, it may be required to take additional measures to reduce costs in order to conserve its cash in amounts sufficient to sustain operations and meet its obligations. These measures could cause significant delays or entirely prevent the Company’s continued efforts to progress its research and development program, pursue product portfolio expansion or commercialize its current or future products, each of which areis critical to the realization of itsthe Company's business plan and theits future operations of the Company.operations. This uncertainty, along with the Company’s history of losses, indicates that there is substantial doubt exists about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The financial statements and this MD&A do not include any adjustments to the amounts and classification of assets and liabilities that wouldmay be necessary should the Company be unable to continue as a going concern. Such adjustments could be material.

As of December 31, 2024,2025, the Company had cash and cash equivalents of $4,164,323$8,705,218 compared to cash and cash equivalents of $1,719,338$4,164,323 as of December 31, 2023.2024. During the year ended December 31, 2024,2025, the Company received $5,172,500$9,790,015 of proceeds from the issuance of convertible notes, $5,470,000 net proceeds from the issuance of common shares inother athan non-brokeredunder privatethe placementSEPA, and$11,866,293 $1,784,691 netof proceeds from issuance of the Debentures, $8,427,416 of proceeds from issuance of common shares related tounder the NasdaqSEPA, listing.$9,874,998 of proceeds from exercise of the warrants and $162,400 of proceeds from exercise of the stock options. For the year ended December 31, 2024,2025, cash used in operating activities was $10,247,231$22,776,769 compared to $4,158,264$10,247,231 for the equivalent period in the prior year. As of December 31, 2024,2025, the Company has an accumulated deficit of $28,903,903$64,348,118 (December 31, 20232024 - $17,698,387$28,903,903) and net loss and comprehensive loss of $11,155,516$35,444,361 for the year ended December 31, 20242025 (20232024 - $5,314,765$11,155,516). The Company has a working capital surplusdeficit of $3,072,078$47,418 as of December 31, 20242025 (December 31, 20232024 - $1,111,448$3,072,078).

This Item and other sections of this Quarterly Report containscontain forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. When reviewing the discussion below, you should keep in mind the substantial risks and uncertainties that impact our business. In particular, we encourage you to review the risks and uncertainties described in "Risk Factors" in Part I, Item 1A in the 2025 Annual Report and Part II, Item 1A of this Quarterly Report. These risks and uncertainties could cause actual results to differ materially from those projected or implied by our forward-looking statements contained in this Quarterly Report. These forward-looking statements are made as of the date of this Quarterly Report, and we do not intend, and do not assume any obligation, to update these forward-looking statements, except as required by law. All amounts are expressed in United States dollars unless otherwise stated. This discussion should be read in conjunction with the Company's interim unaudited condensed consolidated financial statements for the three and six months ended MarchJune 31,30, 2026 and 2025.

Medicus Pharma Ltd. (the "Company") is a clinical stage, multi-strategymulti-strategy, biotech/life sciences company focused on investing in and accelerating clinical development programs of novel and potentially disruptive therapeutic assets. The Company looks into opportunities across all therapeutic areas where an unmet need exists for improved patient safety and efficacy. The Company is opportunistically exploring to expand its drug development pipeline through qualified and accretive acquisitions and partnerships.

The Company has twothree wholly owned subsidiaries, Medicus Pharma Inc., a company incorporated in the state of Delaware on October 12, 2023, and SkinJect, Inc. ("SkinjectSkinJect"), a company incorporated in the state of Pennsylvania on March 3, 2015.2015 and, for purposes of engaging in the Secured Promissory Notes (as defined below) transactions, MDCX Holdings, LLC, a limited liability company organized in the state of Utah on May 19, 2026.

SkinJect is focused on the development of a novel "innovation combination product", as an investigational new drug, using uniquely designed, patent protected dissolvable microneedle arrays ("C-MNAsC-MNA" or P-MNAs"P-MNA") and doxorubicin containing dissolvable microneedle arrays ("D-MNAsD-MNA") for the treatment of certain skin cancers. To that end, the Company licensed certain technology co-developed by the University of Pittsburgh and Carnegie Mellon University. The Company established and validated fabrication processes relative to the C-MNAs or P-MNAs and D-MNAs, completed pre-clinical testing and secured approval to proceed with clinical trials activity from the Food and Drug Administration ("FDA").

On June 25, 2024, the Company's shareholders approved an amendment to the Company's articles of incorporation to provide for a share consolidation (the "Share Consolidation"), or reverse stock split, of the Company's issued and outstanding common shares at such a consolidation ratio to be determined by the Company's board of directors in its sole discretion, to permit the Company to satisfy all conditions and necessary regulatory approvals to list the common shares on a U.S. national securities exchange as the Company's board of directors may determine in its sole direction.discretion. Our board of directors approved the Share Consolidation on October 15, 2024, and the Share Consolidation was completed by the Company on October 28, 2024, at the ratio of 1-for-2.

Total gross proceeds from our initial public offering were $4.0 million, including the proceeds from the Overallotment Warrants. The Company incurred total issuance costs of $2.1 million, including underwriter fees, and legal and other professional fees incurred directly related to the issuance. No Public Warrants issued as part of our initial public offering were exercised during the three and six months ended MarchJune 31,30, 2026.

On March 10, 2025, the Company completed an offering (the "Regulation A Offering") of 1,490,000 units at $2.80 per unit pursuant to Tier II of Regulation A under the Securities Act, with each unit consisting of one common share and one warrant (each, a "Regulation A Warrant"). The Regulation A Warrants have an exercise price of $2.80 and expire on March 10, 2030. The aggregate gross proceeds to the Company from the Regulation A Offering were $4.2 million. No Regulation A Warrants were exercised during the three and six months ended MarchJune 31,30, 2026.

On May 2, 2025, the Company entered into a securities purchase agreement with YA II PN, Ltd. ("Yorkville"), under which the Company has issued and sold three debentures (the "Initial Debentures") to Yorkville in an aggregate principal amount totaling $5,000,000. The Initial Debentures were issued at a discounted price of 90% for proceeds to the Company of $4,500,000. Interest accrued on the outstanding principal amount of each Initial DebenturesDebenture at an annual rate of 8%, subject to a potential increase to 18% per annum upon the occurrence of certain events of default. The Initial Debentures had a maturity date of February 2, 2026.

On September 17, 2025, the Company entered into a securities purchase agreement with Yorkville to issue a new debenture (the "Debenture") with the principal amount of $8,000,000 issued at a discount of $633,707 for proceeds of approximately $7,366,293. Interest will accrueaccrued on the outstanding principal amount of the Debenture at an annual rate of 8%, subject to a potential increase to 18% per annum upon the occurrence of certain events of default. The Debenture willhad maturea onmaturity date of September 17, 2026 and willwas to be partially repaid using proceeds from the SEPA (as defined below). On May 27, 2026, the Company used part of the proceeds of its issuance of the Secured Promissory Notes to repay and extinguish the outstanding balance and accrued interest owing on the Debenture.

On June 2, 2025, the Company closed a public offering with gross proceeds of $7.0 million (the "June 2025 Public Offering"). The Company issued 2,260,000 units at a price of $3.10 per unit. Each unit consisted of one common share of the Company and one warrant to purchase one common share (the "June 2030 Warrants"). The June 2030 Warrants have an exercise price of $3.10 per share and will expire on June 2, 2030. No June 2030 Warrants were exercised during the three and six months ended MarchJune 31,30, 2026.

On December 29, 2025, we entered into an equity distribution agreement (the "Equity Distribution Agreement") with Maxim Group LLC and Yorkville Securities, LLC, an affiliate of Yorkville as agents (together, the "Agents"), whereby the Agents may sell up to $15.3 million of our common shares as part of an at-the-market program (the "ATM"). On April 23, 2026, the Company and the Agents entered into an amendment to the Equity Distribution Agreement, up-sizing the ATM program from $15.3 million to up to $50 million.

The following table outlines our statements of loss and comprehensive loss for the three and six months ended MarchJune 31,30, 2026 and 2025:

General and administrative expenses increased by $2,772,624$1,994,573 or 88.9%43.6% for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, and increased by $4,767,197 or 61.9% for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. This increase was primarily due to an increase in consulting fees, salaries and wages with increased headcount at board and management level and fees, expenses related to business development and investor relations and stock-based compensation. General and administrative expenses primarily include professional fees, consulting fees, salaries, wages and benefits, general office, insurance, administration expenditures, costs related to business development and investor relations, public relations, market awareness, advocacy and stock-based compensation associated with maintaining investor relations, public relations, market awareness, advocacy, director and officer insurance and compliance with applicable securities law requirements. In addition, there are additional costs, recurring and non-recurring, associated with increased regulatory requirements following the Company's initial public offering, transition to U.S. domestic issuer status, multiple financing transactions and the Antev acquisition.

R&D expenses increased by $698,179$4,166,307 or 34.8%120.9% for the threesix months ended MarchJune 31,30, 2026, compared to the threesix months ended MarchJune 31,30, 2025. This increase is primarily due to to the start of the development of Teverelix, offset with a reduction in costs relating to SkinJect as we come to the end of its Phase II2 trials. We expect our R&D expenses to increase going forward with the costs of two separate Phase II2 trials associated with Teverelix advancing.

The principal risks related to the Company's future performance are that the trials are unsuccessful, the Company does not receive FDA approval to proceed with the next stagestages of its multiple research and development,development tracks, or the Company is unsuccessful in obtaining future funding needed to continue its research and development.development tracks. These are customary risks for a development stage pharmaceutical Company and are less acute than for a Company with a less advanced product. Nevertheless, there can be no assurance that the Company will be able to complete its trials of the MNA,trials, that the trials will be successful, or that the product will ultimately reach commercialization.

Other income (expense) for the three and six months ended MarchJune 31,30, 2026, was an expense of $445,234$205,638 and $650,872, respectively, compared to an incomeexpense of $23,866$159,996 and $136,130 for the three and six months ended MarchJune 31,30, 2025.2025, respectively. Other income (expense) for the three and six months ended MarchJune 31,30, 2026 is primarily related to finance income of $56,561, interest expense of $374,712$205,638 and $523,789, respectively, a loss ofon SEPA settlements of $127,083.$nil and $127,083, respectively. Other income (expense) for the three and six months ended MarchJune 31,30, 2025 isconsisted primarily relatedof to interestfinance income earnedof on$40,004 short-termand money$63,870, marketrespectively, investmentsmore than offset by a $200,000 change in the fair value of $23,866.debentures recognized in each period.

The Company expects to continue to incur significant operating losses for the foreseeable future and may never become profitable. In addition to the ATM, SEPA and DebentureSecured Promissory Notes (as defined herein), management believes that the Company has access to additional capital resources through public and/or private equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements. However, it is possible that the Company may not be able to obtain financing on acceptable terms, or at all, and the Company may not be able to enter into strategic alliances or other arrangements on favorable terms, or at all. Further, the terms of any financing may adversely affect the holdings or the rights of the Company's shareholders. If the Company is unable to secure additional capital, it may be required to take additional measures to reduce costs in order to conserve its cash in amounts sufficient to sustain operations and meet its obligations. These measures could cause significant delays or entirely prevent the Company's continued efforts to progress its research and development program, pursue product portfolio expansion or commercialize its current or future products, each of which is critical to the realization of the Company's business plan and its future operations. This uncertainty, along with the Company's history of losses, indicates that substantial doubt exists about the Company's ability to continue as a going concern within one year after the date that the financial statements are issued. The financial statements and this MD&A do not include any adjustments that may be necessary should the Company be unable to continue as a going concern.

As of MarchJune 31,30, 2026, the Company had cash and cash equivalents of $6,365,624$15,174,128 and restricted cash of $10,017,412 compared to cash and cash equivalents of $3,982,430$8,705,218 and restricted cash of $nil as of MarchDecember 31, 2025. During the threesix months ended MarchJune 31,30, 2026, the Company received $5,808,013$21,385,000 of net proceeds from the issuance of the Secured Promissory Notes, $12,399,815 of net proceeds from the issuance of common shares other than under the SEPAATM and $4,102,740 of proceeds from the issuance of common shares under the SEPA. For the threesix months ended MarchJune 31,30, 2026, cash used in operating activities was $(8,969,688)$15,953,129 compared to $(3,940,994)$9,409,825 for the threesix months ended MarchJune 31,30, 2025. As of MarchJune 31,30, 2026, the Company hashad an accumulated deficit of $(73,390,261)$85,007,966 (MarchDecember 31, 2025 -– $(34,006,311)$64,348,118) and net loss of $(9,042,311)$11,684,427 and $20,726,738 for the three and six months ended MarchJune 31,30, 20262026, respectively (MarchJune 31,30, 2025 - $(5,102,408)$6,176,084 and $11,278,492, respectively). The Company has a working capital of $1,328,773$6,140,096 as of MarchJune 31,30, 2026 (March 31, 2025 - $1,751,860).2026.

On March 10, 2025, the Company completed the Regulation A Offering of 1,490,000 units at $2.80 per unit. None of the 1,490,000 Regulation A Warrants have been exercised during the three and six months ended MarchJune 31,30, 2026.

On June 2, 2025, the Company closed its public offering with gross proceeds of $7.0 million. The Company issued 2,260,000 units at a price of $3.10 per unit. Each unit consisted of one common share of the Company and one June 2030 Warrant. The June 2030 Warrants have an exercise price of $3.10 per share and will expire June 2, 2030. As of MarchJune 31,30, 2026, no June 2030 Warrants have been exercised.