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

Our wholly owned subsidiary, Quoin Inc., commenced operations in 2018. As such, we have a limited operating history and our operations are subject to all of the risks inherent in the establishment of a new business enterprise, including a lack of operating history. Since inception, our operations have been primarily limited to acquiring and licensing intellectual property rights, undertaking research and conducting preclinicalpre-clinical and clinical studies for our initial programs and negotiating and executing the Merger and financings. We have not yet obtained regulatory approval for any product candidates. Consequently, any predictions about our future success or viability, or any evaluation of our business and prospects, may not be accurate. The likelihood of our success must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered by a small developing company starting a new business enterprise and the highly competitive environment in which we will operate. Since we have a limited operating history, we cannot assure you that our business will be profitable or that we will ever generate sufficient revenues to meet our expenses and support our anticipated activities. In addition, there is no guarantee that any of our product candidates withwill ever receive approval from the U.S. Food and Drug Administration, or the “FDA.” We cannot be certain that our business strategy will be successful or that we will be solvent at any particular time. Our likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with the early stages of the development of any company. If we fail to address any of these risks or difficulties adequately, our business will likely suffer. Because of the numerous risks and uncertainties associated with developing and commercializing our products, we are unable to predict the extent of any future losses or when we will become profitable, if ever. We may never become profitable and investors may never receive a return on an investment in our securities. An investor in our securities must carefully consider the substantial challenges, risks and uncertainties inherent in the attempted development and commercialization of products in the medical and pharmaceutical industries. We may never successfully commercialize our products and our business may fail.

To date, we have not commercialized any products and have not generated any revenue. We have incurred net losses every year since inception and we have an accumulated deficit of approximately $55.2$71.0 million at December 31, 2024.2025. We have historically funded our operations through our founders’ funding expenditures and debt and equity financings. At December 31, 2024, we had cash balances totaling $3.6 million and investments of $10.4 million. We believe that we have sufficient cash for operating our business for at least the next twelve months from the date of filing this Form 10-K. However, we are subject to risks common to late-stage clinical specialty pharmaceutical companies including, but not limited to, unanticipated or higher than expected clinical trial costs and the ability to estimate such occurrences, if any, on our cash, liquidity, additional financing requirements, and availability. Accordingly, we may need to raise additional funds during this period. We have devoted a majority of our financial resources to research and development, including our preclinicalpre-clinical and ongoing clinical development activities. To date, we have funded our operations primarily through our founders’ funding expenditures and the sale of equity and convertible securities.

Developing pharmaceutical products, including conducting preclinicalpre-clinical studies and clinical trials, is expensive. We expect our research and development expenses to substantially increase in connection with our ongoing activities, particularly as we advance our product candidates towards or through clinical trials. We may need to raise additional capital to support our operations and such funding may not be available to us on acceptable terms, or at all. We cannot provide assurances that our plans will not change or that changed circumstances will not result in the depletion of our capital resources more rapidly than we currently anticipate. For example, our preclinicalpre-clinical or clinical trials may encounter technical difficulties or be subject to delays or other issues. Any of these events may increase our development costs more than we expect. In order to support our long-term plans, we may need to raise additional capital or otherwise obtain funding through additional strategic alliances if we choose to initiate preclinicalpre-clinical or clinical trials for new product candidates other than programs currently partnered. In any event, we will require additional capital to obtain regulatory approval for, and to commercialize, future product candidates.

PreclinicalPre-clinical and clinical studies of our product candidates may not be successful. If we are unable to generate successful results from preclinicalpre-clinical and clinical studies of our product candidates, or experience significant delays in doing so, our business may be materially harmed.

We have no products approved for commercial marketing and most of our product candidates are in preclinicalpre-clinical and clinical development as is the case with our lead asset for NS, which is currently being tested in four separate clinical studies in NS patients. Moreover, the clinical development process can take several years, and there is no assurance that our clinical trials will be successful or that we will obtain marketing approvals for any of our product candidates from either the FDA or any foreign regulatory agencies, such as the EMA. Our ability to achieve and sustain profitability depends on obtaining regulatory approvals for and, if approved, successfully commercializing our product candidates, either alone or with third parties. Before obtaining regulatory approval for the commercial distribution of our product candidates, we or an existing or future collaborator must conduct extensive preclinicalpre-clinical tests and clinical trials to demonstrate the safety and efficacy of our product candidates.

Before obtaining marketing approval from regulatory authorities for the sale of product candidates, we must conduct extensive clinical trials to demonstrate the safety and efficacy of the product candidates in humans. Clinical trials are expensive, difficult to design and implement, can take many years to complete and are uncertain as to the outcome. A failure of one or more clinical trials can occur at any stage of testing. The outcome of preclinicalpre-clinical studies and early clinical trials may not be predictive of the success of later clinical trials, and preliminary results or planned interim analyses of a clinical trial do not necessarily predict final results. Moreover, preclinicalpre-clinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that have believed their product candidates performed satisfactorily in preclinicalpre-clinical studies and clinical trials have nonetheless failed to obtain marketing approval for their products.

Accordingly, we cannot be sure that we will submit INDs on our expected timelines and we cannot be certain the FDA or foreign regulatory agenciesagencies, such as the EMA, will allow us to progress into clinical trials based on the submission of any IND.

Our product development costs will also increase if we experience delays in testing or marketing approvals. We do not know whether any clinical trials will begin as planned, will need to be restructured or will be completed on schedule, or at all. Significant clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow our competitors to bring products to market before we do, which would impair our ability to successfully commercialize our product candidates and may harm our business and results of operations. Any inability to successfully complete preclinicalpre - clinical and clinical development could result in additional costs to us or impair our ability to generate revenues from product sales.

Even if we complete the necessary preclinicalpre - clinical studies and clinical trials, we cannot predict whether or when we will obtain regulatory approval to commercialize a product candidate and we cannot, therefore, predict the timing of any revenue from a future product.

Even if we obtain regulatory approval for a product candidate, we will still face extensive regulatory requirementsrequirements, and our products may face future development and regulatory challenges.

Even if we obtain regulatory approval in the United States, the FDA may still impose significant restrictions on the indicated uses or marketing of our product candidates,candidates or impose ongoing requirements for potentially costly post-approval studies or post-market surveillance. The FDA may also require risk evaluation and mitigation strategies as a condition of approval of our product candidates, which could include requirements for a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools. Additionally, the manufacturing processes, packaging, distribution, adverse event reporting, labeling, advertising, promotion, and recordkeeping for the product will be subject to extensive and ongoing FDA regulatory requirements, in addition to other potentially applicable federal and state laws. These requirements include monitoring and reporting of adverse events (“AEs”) and other post-marketing information and reports, registration, as well as continued compliance with current good manufacturing practice (“cGMP”) regulations. The holder of an approved NDA must also submit new or supplemental applications and obtain FDA approval for certain changes to the approved product, product labeling or manufacturing process. If we or a regulatory agency discovers previously unknown problems with a product such as AEs of unanticipated severity or frequency, or problems with the facility where the product is manufactured, a regulatory agency may impose restrictions relative to that product or the manufacturing facility, including requiring recall or withdrawal of the product from the market or suspension of manufacturing.

We may not be able to obtain or maintain orphan drug designation or obtain orphan drug exclusivity for our product candidates.

We intend to apply forreceived orphan drug designation in the United States for QRX003 for the treatment of NS.NS However,in obtainingOctober an2025. orphanEven drug designation can be difficult, andthough we may not be successful in doing so. Even if we obtainobtained orphan drug designation for a product candidateQRX003 in specificNetherton indications,Syndrome, we may not be the first to obtain regulatory approval of the product candidate for the orphan-designated indication. In addition, exclusive marketing rights in the United States may be limited if we seek approval for an indication broader than the orphan-designated indication or may be lost if the FDA later determines that the request for orphan designation was materially defective or if the manufacturer is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition. Orphan drug designation does not ensure that we will receive marketing exclusivity in a particular market, and we cannot assure you that any future application for orphan drug designation in any other geography or with respect to any other future product candidate will be granted. Orphan drug designation neither shortens the development time or regulatory review time of a drug, nor gives the drug any advantage in the regulatory review or approval process.

We may pursueOur Rare Pediatric Disease designation for QRX003 for the treatment of NS or other of our product candidates. There is no assurance that we will obtain such designation. Moreover, a Rare Pediatric Disease designation byfrom the FDA does not guarantee that the NDA for the product will qualify for a priority review voucher upon approval, and it does not lead to a faster development or regulatory review process, or increase the likelihood that any of our product candidates will receive marketing approval.

Under the Rare Pediatric Disease Priority Review Voucher program, upon the approval of a qualifying NDA for the treatment of a rare pediatric disease, the sponsor of such an application may be awarded a transferable rare pediatric disease priority review voucher that can be used to obtain priority review for a subsequent NDA or BLA. We intendwere to pursuegranted Rare Pediatric Disease designation for QRX003 for the treatment of NS,NS butby therethe isFDA noin assuranceJune that we will receive such designation.2025. Under the current statutory sunset provisions, the FDA may only award a priority review voucher for an approveda rare pediatric disease application if the sponsor has a rare pediatric disease designation for a drug that is the subject of an application, and that designation was grantedapproved by December 20, 2024. The drug also must receive FDA approval no later than September 30, 20262029, to qualify for the priority review vouchers. Although legislation to extend the rare pediatric disease priority review voucher program has been proposed, Congress has not yet, and may never, pass a bill to reauthorizeunless the program and extend the sunset dates. There is no guarantee that the rare pediatric disease priority review voucher program will be extended or that any of our product candidates will obtain such designation and, therefore, we may not be in a position to obtain a priority review voucher.extended. Additionally, designation of a drug for a rare pediatric disease does not guarantee that an NDA will meet the other eligibility criteria for a rare pediatric disease priority review voucher at the time the application is approved. Finally, a Rare Pediatric Disease designation does not lead to faster development or regulatory review of the product,product or increase the likelihood that it will receive marketing approval.

Currently, there are no approved products to treat NS. However, to our knowledge, there are a number of therapeutic products at various stages of development for the treatment of NS, including candidates from LifeMax Laboratories, Inc., Krystal Biotech, Inc., Sixera Pharmaceuticals, ResVita Bio, BioCryst and Azitra Inc. As of now, to the best of our knowledge, out of these companies only Azitra isand BioCryst are actively dosing subjectsubjects in clinical studies onof NS patients under an open IND.

All of our product candidates are in either preclinicalpre - clinical or clinical development and targeted toward indications for which there may be other product candidates in clinical development. We may face competition from other drugs currently approved or that may be approved in the future for the same therapeutic indications as our product candidates. Our ability to compete successfully will depend largely on our ability to leverage our experience in drug development to:

We currently do not have an organization for the sales, marketing and distribution of pharmaceutical products and the cost of establishing and maintaining such an organization may exceed the cost-effectiveness of doing so. In order to market any products that may be approved, we must build our sales, marketing, managerial and other non-technical capabilities or make arrangements with third parties to perform these services. With respect to future programs, we may rely completely on an alliance partner for sales and marketing. In addition, we may enter into strategic alliances with third parties to commercialize other product candidates, if approved, including in markets outside of the United StatesStates, Europe and EuropeJapan or for other large markets that are beyond our resources. Although we intend to establish a sales organization if we are able to obtain approval to market any product candidates in the United States, Europe and EuropeJapan we will also consider the option to enter into strategic alliances for future product candidates in the United StatesStates, Europe and EuropeJapan if commercialization requirements exceed our available resources. This will reduce the revenue generated from the sales of these products.

Any future strategic alliance partners may not dedicate sufficient resources to the commercialization of our product candidates, if approved, or may otherwise fail in their commercialization due to factors beyond our control. If we are unable to establish effective alliances to enable the sale of our product candidates, if approved, to healthcare professionals and in geographical regions, including the United StatesStates, Europe and Europe,Japan, that will not be covered by our own marketing and sales force, or if our potential future strategic alliance partners do not successfully commercialize the product candidates that may be approved, our ability to generate revenues from product sales will be adversely affected.

If we obtain approval to commercialize any approved products outside of the United States and Europe, a variety of risks associated with international operations could materially adversely affect our business.

If we obtain approval to commercialize any approved products outside of the United States and Europe,States, we expect that we will be subject to additional risks related to entering into international business relationships, including:

We rely on third parties to conduct some aspects of our compound formulation, research and preclinicalpre - clinical studies, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such formulation, research or testing.

We do not expect to independently conduct all aspects of our drug development activities, compound formulation research or preclinicalpre-clinical studies of product candidates. We currently rely and expect to continue to rely on third parties to conduct some or all aspects of our preclinicalpre-clinical studies and formulation development.

If these third parties do not successfully carry out their contractual duties, meet expected deadlines or conduct our studies in accordance with regulatory requirements or our stated study plans and protocols, we will not be able to complete, or may be delayed in completing, the necessary preclinicalpre-clinical studies to enable us to select viable product candidates for IND submissions and we will not be able to, or may be delayed in our efforts to, successfully develop and commercialize such product candidates.

We rely, or will rely, on third-party manufacturers to produce the supply of our preclinicalpre - clinical product, clinical product candidates and commercial supplies of any approved product candidates.

We have established manufacturing relationships with a limited number of suppliers to manufacture raw materials and the drug substance used to create our product candidates. The availability of such suppliers to manufacture raw materials and drug substance for our product candidates in sufficient quantities for evaluation in preclinicalpre - clinical or clinical studies or, if our product candidates are approved, for commercial supply may be limited. Further, each supplier may require licenses to manufacture such components if such processes are not owned by the supplier or in the public domain. As part of any marketing approval, a manufacturer and its processes are required to be qualified by the FDA prior to commercialization. If product supply from any manufacturer approved in the NDA is interrupted, there could be a significant disruption in commercial supply. An alternative manufacturer would need to be qualified through an NDA supplement which could result in further delay. The FDA or other regulatory agencies outside of the United States may also require additional studies if a new manufacturer is relied upon for commercial production. Switching manufacturers may involve substantial costs and is likely to result in a delay in our desired clinical and commercial timelines.

We intend to rely on third parties to conduct, supervise and monitor our clinical trials, and if those third parties perform in an unsatisfactory manner, it may harm our business.

We intendcurrently rely on, and expect to continue to rely onon, CROs and clinical trial sites to ensure the proper and timely conduct of our clinical trials. While we will have agreements governing their activities, we have limited influence over their actual performance. We will control only certain aspects of our CROs’ activities. Nevertheless, we will beare responsible for ensuring that each of our clinical trials are conducted in accordance with the applicable protocol, legal, regulatory and scientific standards and our reliance on the CROs will not relieve us of our regulatory responsibilities.

We and our CROs will beare required to comply with the FDA’s or other regulatory agency’s GCPs, for conducting, recording and reporting the results of IND-enabling studies and clinical trials to assureensure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of clinical trial participants are protected. The FDA and non-U.S. regulatory agencies enforce these GCPs through periodic inspections of trial sponsors, CROs, principal investigators and clinical trial sites. If we or our CROs fail to comply with applicable GCPs, the clinical data generated in our clinical trials may be deemed unreliable and the FDA or applicable non-U.S. regulatory agency may require us to perform additional clinical trials before approving any marketing applications for the relevant jurisdiction. Upon inspection, the FDA or applicable non-U.S. regulatory agency may determine that our clinical trials did not comply with GCPs. In addition, our clinical trials will require a sufficiently largesufficient number of test subjects to evaluate the safety and effectiveness of a potential drug product. Accordingly, if our CROs fail to comply with these regulations or fail to recruit a sufficient number of patients, we may be required to repeat such clinical trials, which would delay the regulatory approval process.

Our CROs willare not be our employees, and we willare not be able to control whether or not they devote sufficient time and resources to our clinical and nonclinical programs. TheseOur CROs may also have relationships with other commercial entities, including our competitors, for whom they may also be conducting clinical trials, or other drug development activities which could harm our competitive position. If our CROs do not successfully carry out their contractual duties or obligations, fail to meet expected deadlines, or if the quality or accuracy of the clinical data they obtain is compromised due to the failure to adhere to our clinical protocols or regulatory requirements, or for any other reasons, our clinical trials may be extended, delayed or terminated, and we may not be able to obtain regulatory approval for, or successfully commercialize our product candidates. As a result, our financial results and the commercial prospects for such products and any product candidates that we develop would be harmed, our costs could increase, and our ability to generate revenues could be delayed.

We intendalso currently rely on, and expect to continue to rely onon, other third parties to package, store and deliver drug products to theour clinical trial sites for any clinical trials that we may conduct.sites. Any performance failure on the part of these third parties could delay clinical development or marketing approval of our product candidates or commercialization of our products, if approved, producing additional losses and depriving us of potential product revenue.

If the patent applications we hold or patents we have in-licensed with respect to our programs or product candidates fail to issue or if their breadth or strength of protection is threatened, as applicable, it could dissuade companies from collaborating with us to develop product candidates, and threaten our ability to commercialize, future products. We cannot offer any assurances about which, if any, patents will issue or whether any issued patents will be found invalid and unenforceable or will be threatened by third parties. A patent may be challenged through one or more of several administrative proceedings including post-grant challenges, re-examination or opposition before the United States Patent and Trademark Office (“USPTO”) or foreign patent offices. Any successful challenge of patents or any other patents owned by or licensed to us could deprive us of rights necessary for the successful commercialization of any product candidates that we may develop.

In addition, patents have a limited lifespan. In the United States, the natural expiration of a patent is generally 20 years after it is filed. Various extensions may be available, however the life of a patent, and the protection it affords is limited. Once the patent life has expired for a product, we may be open to competition from generic medications. Further, if we encounter delays in regulatory approvals, the period of time during which we could market a product candidate under patent protection could be reduced. One of our patents expired in March 2024 and another is set to expire in July 2025.

We are highly dependent on principal members of our executive team, and any reduction or loss of their services may adversely impact the achievement of our objectives. While we have entered into employment agreements with each of our executive officers, any of them could leave our employment at any time. Recruiting and retaining other qualified employees for our business, including scientific and technical personnel, will also be critical to our success. There is currently a shortage of skilled executives in our industry, which is likely to continue. As a result, competition for skilled personnel is intense and the turnover rate can be high. We may not be able to attract and retain personnel on acceptable terms given the competition among numerous pharmaceutical companies for individuals with similar skill sets. In addition, failure to succeed in preclinicalpre - clinical studies and clinical trials may make it more challenging to recruit and retain qualified personnel. The inability to recruit any executive or key employee or the loss of the services of any executive or key employee might impede the progress of our research, development and commercialization objectives.

In addition, the European Union (“EU”) has established its own data security and privacy legal framework, including but not limited to Directive 95/46/EC (the “Data Protection Directive”). The European General Data Protection Regulation (“GDPR”) contains new provisions specifically directed at the processing of health information, higher sanctions and extra-territoriality measures intended to bring non-EU companies under the regulation. We anticipate that over time we may expand our business operations to include additional operations in the EU, including potentially conducting preclinicalpre - clinical and clinical trials. With such expansion, we would be subject to increased governmental regulation in the EU countries in which we might operate, including regulation due to the GDPR.

Our operations and commercial success may be impacted from changes to current regulations and future legislation.

The United States and many foreign jurisdictions have enacted or proposed legislative and regulatory changes affecting the healthcare system that could prevent or delay approval of our products, restrict or regulate post-approval activities, such as sales and promotional activities and affectexpand ourpost-approval ability to profitably sell a drug product for which we obtain approval.requirements. Changes in regulations, statutes or the interpretation of existing regulations could impact our business in the future by requiring, for example:

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our audited consolidated financial statements and related notes to those statements included in this Annual Report. Our consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”), reflect the operations of Quoin Pharmaceuticals Inc. (“Quoin Inc.”) since inception and include the accounts of Quoin Ltd. since the closing of the Merger (as defined below). In addition to historical financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, beliefs and expectations that involve risks and uncertainties. Our actual results and the timing of events could differ materially from those discussed in these forward-looking statements. Important factors that could cause or contribute to these differences include those discussed below and elsewhere in this Annual Report, particularly in Part I, Item 1A. “Risk Factors” and the section entitled “Cautionary Note Regarding Forward-Looking Statements and Summary of Risk Factors.”

We are a late-stage clinical specialty pharmaceutical company focused on the development and commercialization of therapeutic products that treat rare and orphan diseases for which there are currently either no approved or very limited treatments or cures. Our initial focus is on the development of products, using our proprietary owned and in-licensed drug delivery technologies, that could help address rare genetic diseases. Our lead product, QRX003, is under clinical development as a potential treatment for Netherton Syndrome, a rare hereditary genetic disease. QRX003 is currentlyentering beingpivotal tested in three regulatoryregistrational clinical studiestesting under an open IND application with the FDA. We have opened fivesix clinical sites in the USU.S. along with international sites that are being opened in the UK, Spain, France and intend to open a sixth clinical site at Northwestern University. We are expanding our trials internationally into the Middle East, the United Kingdom and additional countries in Western and Eastern Europe.Netherlands. QRX003 is currently being tested in aseven pediatric NS patientpatients atin investigator-initiated studies in Ireland, Austria, the Children’s Hospital in Dublin, IrelandNetherlands and weNew intend to expand this study to include additional children with NS in Spain, the United Kingdom and potentially other countries.Zealand. QRX003 is also being developed as a potential treatment for Peeling Skin Syndrome with the first subject being treated in New Zealand. InWe addition,are wein the process of expanding this study to include up to an additional five pediatric subjects. We entered into two separatea Research AgreementsAgreement with the Queensland University of Technology,QUT, under which we have obtained an option for a global licenseslicense to QRX007 for the potential treatment of NS and QRX008 for the potential treatment of scleroderma, as well as a Research Agreement with the University College CorkUCC for the development of novel topical formulations of Rapamycinrapamycin (sirolimus) as potential treatments for a number of rare and orphan diseases for which there are currentlyeither limited or no approved therapies or cures.cures, Otherincluding developmentmicrocystic productslymphatic malformations, venous malformations and angiofibromas among others. We have also entered into 9 commercial partnerships for QRX003 spanning 61 countries outside of our core commercial territories of the U.S., Western Europe and Japan. These partnership countries include Canada, Australia, New Zealand, the Middle East, China, Taiwan, Hong Kong Singapore, Israel, Central and Eastern Europe, Turkey as well as several countries in ourLatin pipeline include QRX004 as a potential treatment for Recessive Dystrophic Epidermolysis Bullosa.America.

Our mission is to develop and commercialize proprietary therapeutic drug products that treat rare and orphan diseases, particularly for those diseases where noneno approved treatment currently exists. To achieve this, we plan to:

To date, no products have been commercialized and no revenue has been generated. We do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates, which we expect will take a number of years and is subject to significant uncertainty. Accordingly, weWe will need to raiseobtain additionalfurther funding through public or private offerings of our capital priorstock, debt financing, pursuant to the commercializationexercise of QRX003warrants or any other product candidate. Until such time, if ever, as we can generate substantial revenue from product sales, we expectissued to financeinvestors in our operatingprior activitiespublic throughand a combination of equityprivate offerings, debtcollaboration, financings,strategic governmentand/or licensing arrangements or other third-partysources funding,in commercialization,order marketingto complete the research and distributiondevelopment arrangementsof our product candidates and to fund our other collaborations,operating strategic alliances and licensing arrangements.requirements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. In addition, any exercise of our outstanding warrants is at the discretion of the warrant holders and is dependent, in part, upon the market price of our ADSs. There can be no assurance that any of our outstanding warrants will ever be in-the-money prior to their expiration and, as such, our outstanding warrants may expire without being exercised. Our failure to raiseobtain capitaladditional funding or enter into such other arrangements as and when needed would have a negative impact on our financial condition and our ability to continue our operations. See “Liquidity and Capital Resources”.

KeyRecent EventsDevelopments

Public and Private Offerings

March 2024 Offering. On March 7, 2024, we completed an offering (the “March 2024 Offering”) of the following securities (i) 811,250 ordinary shares represented by 23,179 ADSs, (ii) 4,062,500 Series D warrants (the “Series D Warrants”) to purchase 4,062,500 ordinary shares represented by 116,071 ADSs, (iii) 4,062,500 Series E warrants (the “Series E Warrants”) to purchase 4,062,500 ordinary shares represented by 116,071 ADSs, and (iv) 3,251,250 pre-fundedPre-funded warrants (the “March 2024 Pre-Funded Warrants”) to purchase 3,251,2503,251,255 ordinary shares represented by 92,893 ADSs for aggregate gross proceeds of approximately $6.5 million, resulting in net proceeds of approximately $5.5 million, after deducting the placement agent’s fees and offering expenses paid by us. Each ADS (or March 2024 Pre-Funded Warrant to purchase one ADS in lieu thereof) was sold together with a Series D Warrant to purchase one ADS and a Series E Warrant to purchase one ADS. The ADSs and accompanying Series D Warrants and the Series E Warrants were sold at a combined public offering price of $1.60$56 and the March 2024 Pre-Funded Warrants and accompanying Series D Warrants and the Series E Warrants were sold at a combined public offering price of $1.5999,$55.9965, which is equal to the combined purchase price per ADS and accompanying Series D Warrants and the Series E Warrants, minus the exercise price of each March 2024 Pre-Funded Warrant of $0.0001.$0.0035. As of December 31, 20242024, all March 2024 Pre-Funded Warrants havehad been exercised and arewere included in issued and outstanding ADSs. The Series D Warrants and the Series E Warrants have an exercise price of $1.60$56 per share, were exercisable immediately following the closing of the March 2024 Offering and expire in two years and five years, respectively, from the closing of the March 2024 Offering.

December 2024 Offering. On December 23, 2024, we completed an offering (the “December 2024 Offering” and, together with the March 2024 Offering, the “2024 Offerings”) of the following securities (i) 3,137,778 ordinary shares represented by 89,651 ADSs, (ii) 15,111,110 Series F warrants (the “Series F Warrants”) to purchase 15,111,110 ordinary shares represented by 431,746 ADSs, (iii) 15,111,110 Series G warrants (the “Series G Warrants” and together with the Series F Warrants, the “December 2024 Warrants”) to purchase 15,111,110 ordinary shares represented by 431,746 ADSs, and (iv) 11,973,332 pre-fundedPre-funded warrants (the “December 2024 Pre-Funded Warrants”) to purchase 11,973,332 ordinary shares represented by 342,095 ADSs for aggregate gross proceeds of approximately $6.8 million, resulting in net proceeds of approximately $5.8 million, after deducting the placement agent’s fees and offering expenses paid by us. Each ADS (or December 2024 Pre-Funded Warrant to purchase one ADS in lieu thereof) was sold together with a Series F Warrant to purchase one ADS and a Series G Warrant to purchase one ADS. The ADSs and accompanying Series F Warrants and Series G Warrants were sold at a combined public offering price of $0.45$15.75 and the December 2024 Pre-Funded Warrants and accompanying Series F Warrants and Series G Warrants were sold at a combined public offering price of $0.4499,$15.7465, which is equal to the combined purchase price per ADS and accompanying Series F Warrants and Series G Warrants, minus the exercise price of each December 2024 Pre-Funded Warrant of $0.0001. As of December 31, 2024, 760,666 December 2024 Pre-Funded Warrants, have been exercised and are included in issued and outstanding ADSs. The December 2024 Pre-Funded Warrants were immediately exercisable upon issuance and may be exercised at any time until exercised in full.$0.0035. The Series F Warrants and the Series G Warrants have an exercise price of $0.45$15.75 per share, were exercisable immediately upon issuance and expire in two years and five years, respectively, from the closing of the December 2024 Offering. In January and FebruaryDurin 2025, certain investors in theour December 2024 Offering exercised (i) the remaining outstanding 11,212,666320,362 December 2024 Pre-Funded Warrants, (ii) 320,000199,619 Series F Warrants,Warrants and (iii) 105,00023,182 Series G Warrants.Warrants, resulting in net proceeds of approximately $3.5 million. As of December 31, 2025, all of the December 2024 Pre-Funded Warrants have been exercised and are included in issued and outstanding ADSs.

Certain of our officers and directors purchased an aggregate of 1,333,333 of our38,095 ADSs and accompanying December 2024 Warrants to purchase 2,666,666 of our76,190 ADSs, for a total purchase price of approximately $600,000, at the public offering price and on the same terms as the other purchasers in the December 2024 Offering.

General and administrative expenses consist primarily of compensation and employee - related expenses including non-cash stock-based compensation, professional fees and other corporate expenses. We anticipate that our general and administrative expenses will increase in the future to support our continued research and development activities. These increases will likely include compensation and employee-related expenses including stock-based compensation, increased costs related to the potential hiring of personnel, travel costs and fees to outside consultants, lawyers and accountants.

General and administrative expenses were approximately $5,926,000$6,488,000 and $6,071,000,$5,926,000, in the year ended December 31, 20242025 and 2023,2024, respectively, representing aan decreaseincrease of $145,000,$562,000, or 2.4%.9.5%. The decreaseincrease was primarily due to aan decreaseincrease in travelpublic allocated to general and administrativecompany expenses of $168,000,$215,000; alegal decrease in insurancefees of $124,000,$117,000; offsetmarketing withexpenses anof $114,000; consulting expenses of $105,000 and other (primarily corporate taxes) of $163,000; and increase in payroll and benefits of $105,000,$63,000 anoffset increaseby decreases in legalboard cash fees and other public company expenses of $49,000, and an increase in non-cash stock-based compensation expense of $24,000.$142,000 and lower insurance costs by $77,000.

Our research and development (R&D) expenses during the yearyears ended December 31, 20242025 and 20232024 were approximately $3,603,000$9,803,000 and $3,308,000,$3,603,000, respectively, representing an increase of $295,000,$6,200,000, or approximately 8.9%.172%. The increase was primarily due to an increase of $176,000$6,094,000 worth of expenditures on our development programs, including work related to the clinical studies for the development of QRX003, manufacturing costs for material used in our clinical studies an increased allocation of internal compensation and travel costs to our research and development programs. The increase also included approximately $140,000$106,000 in non-cash stock-based compensation expense. We expect to continue our research and development efforts by conducting the remaining studies necessary for the development and approval of QRX003, see “Components of Our Results of Operations - Research and Development Expenses” above.

We amortize licensed or acquired intellectual property over its expected useful life, included in research and development expenses set out above. The license from Skinvisible was obtained in October 2019, see “Research and Development,Development PatentsCommitments” and Licenses.”below. Amortization of intangible assets was approximately $100,000 and $104,000$100,000 in each of the years ended December 31, 20242025 and 2023. As of December 31, 2023 we determined that the Polytherapeutics asset was no longer of use and reduced the carrying value to zero, incurring an impairment charge of approximately $18,000.2024.

We earned approximately $482,000 in interest income and approximately $4,000 in unrealized gain and earned approximately $558,000 in interest income and approximately $7,500 in unrealized gain, and earned approximately $695,000 in interest income and incurred approximately $3,000 in unrealized loss, in the year ended December 31, 20242025 and December 3131, 2023,2024, respectively, from our cash and cash equivalents and investments in marketable debt securities. The decrease in interest income in the year ending December 31, 20242025 is the result of lower average aggregate cash and investment balances and a decrease in interest rates.

We will need to obtain further funding through public or private offerings of our capital stock, debt financing, collaborationpursuant to the exercise of warrants issued to investors in our prior public and private offerings, collaboration, strategic and/or licensing arrangements or other sources, the requirements for which will depend on many factors, including:

Adequate additional funding may not be available to us on acceptable terms, or at all. In addition, restrictions under the October 2025 Purchase Agreement may limit our ability to raise capital. See “Risk Factors ─The terms of our October 2025 private placement may make it difficult for us to procure additional financing” for more information. If we are unable to raise capital in sufficient amounts or on terms acceptable to us, we may have to significantly delay, scale back or discontinue the development or commercialization of QRX003, any future product candidate, or potentially discontinue operations.

To the extent that we raise additional capital through the sale of our equity or convertible debt securities, and pursuant to the exercise of the warrants issued to ourthe investors in theour 2022prior Offering, the 2023 Offeringpublic and theprivate 2024 Offerings,offerings, the ownership interest of our equity holders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our equity holders. Debt financing and preferred 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 additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may be required to relinquish valuable rights to our technologies, future revenue streams, research programs or proposed products, or to grant licenses on terms that may not be favorable to us. 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 drug development or future commercialization efforts or grant rights to develop and market any future product that we would otherwise prefer to develop and market ourselves.

As of December 31, 2024,2025, we had approximately $14,057,000$18,745,000 in cash and investments in marketable securities. The table below presents our cash flows for the yearyears ended December 31, 20242025 and 20232024:

Net cash used in operating activities was approximately $7,857,000$13,541,000 and $7,864,000$7,857,000 for the year ended December 31, 20242025 and 2023,2024, respectively. The decreaseincrease for the year ended December 31, 20242025 was primarily due to ana increasehigher innet non-cashoperating basedloss stockdriven compensationby andhigher R&D expenditures offset by an increase in accounts payable and accrued expenses, offset by an increase in operating expense and an increase in prepaid expenses and other assets.expenses.

Net cash used in investing activities was approximately $4,278,000 and $1,888,000 in the year ended December 31, 2024 was approximately $1,888,0002025 and net2024, cashrespectively, provided by investing activities inwith the year ended December 31, 2023 was approximately $2,188,000change in each period consisting of net proceeds from maturity and purchases of short maturity US Treasury Bills and Notes.

In October 2019, Quoin Inc. entered into the Exclusive Licensing Agreement (as amended from time to time, the “License Agreement”) with Skinvisible Pharmaceuticals, Inc. (“Skinvisible”),Skinvisible, under which Skinvisible granted us an exclusive royalty-bearing license relating to the production and manufacture of prescription drug products related to certain patents held by Skinvisible, including those related to QRX003 and QRX004. We made Skinvisible a one-time non-refundable, non-creditable license fee of $1 million (the “License Fee”). In addition, we agreed to pay Skinvisible a single digit royalty percentage of our net sales revenues for any licensed product covered by the patent rights licensed under the License Agreement. We also agreed to pay Skinvisible 25% of any revenues we receive as royalties in the event that we sublicense any licensed products to a third party. The License Agreement also requires that we make a $5 million payment to Skinvisible upon receiving approval in the U.S. or European Union, whichever occurs first, for the first drug product developed using intellectual property licensed thereunder.

In November 2020, Quoin Inc. entered into a Master Service Agreement with Therapeutics Inc. for the management of the preclinicalpre-clinical and clinical development of QRX003 for Netherton Syndrome. The initial term of the agreement was three years with automatic one yearone-year extensions, and the agreement required the execution of individual work orders. Quoin Inc. may terminate any work order for any reason with 90 days written notice subject to costs incurred through termination and a defined termination fee, unless there is a material breach by Therapeutics Inc. A work order was entered into in June 2022 for the first QRX003 clinical study at an expected estimated cost of approximately $4.4 million through 2024. An additional change order was entered into in December 2022 for a second QRX003 clinical study at an expected estimated cost of approximately $830,000. An amended and restated change order for the two studies was entered into in December 2024 at an estimated total remaining cost from August 2024 of approximately $3.6 million for the two studies combined. In the years ended December 31, 20242025 and 2023,2024, we incurred research and development costs under these agreements of approximately $1.1$2.1 million and $1.5$1.1 million, respectively. During the year ended December 31, 2024, the Companywe received a credit of approximately $83,000 applied to prior expenses incurred during the period of January 2024 to March 2024. During the year ended December 31, 2023, the Company received a credit of approximately $278,000 applied to prior expenses incurred during the period of March 2023 to July 2023.

In November 2021, we entered into a research agreement with Queensland University of Technology (QUT) for a pre-clinical research program for the development of a product to treat Netherton Syndrome of approximately $250,000. In May 2022, we entered into a second research agreement with QUT for the development of a product to treat Scleroderma of approximately $610,000. Each agreement remains in place until the completion of the research program, which in each case was initially anticipated to be 18 months from execution. For the years ended December 31,30, 20242025 and 2023,2024, we incurreddid researchnot andincur developmentany costs related to these agreementsagreements. In July 2025 we announced that, in light of approximatelythe $0expected andnear-term $361,000completion respectively.of Quointhe isQRX003 clinical program for Netherton Syndrome, we have discontinued Netherton Syndrome research program with QUT. We are planning to schedule a meeting with QUT to discuss the future direction of boththe Scleroderma research programs.program.

OnIn June 10, 2024, we entered into a research agreement with The School of Pharmacy at UCC. The scope of the agreement encompasses the development of novel topical formulations of Rapamycin (sirolimus) as potential treatments for a number of rare and orphan diseases for which there are currently very limited or no approved therapies or cures. Under the terms of the agreement, based on the achievement of certain milestones, we will fund up to approximately €567,000 ($608,000$664,000) plus VAT over an anticipated 2-1/2 year period to support the UCC research program to investigate the development of a number of topical rapamycin formulations for future development as potential treatments for several rare and orphan diseases. Following completion of the research program, we will have the option to advance the clinical development of rapamycin formulations developed by UCC. Work on this research project commenced in December 20242024. For the years ended December 31, 2025 and December 31, 2024, we accruedincurred $10,000 ina research and development costsexpense under these agreements of approximately $0.3 million and de-minimis respectively. On November 11, 2025 we announced that the target loading concentrations for thetwo yeartopical endedrapamycin Decemberdelivery 31,technologies 2024.have been successfully achieved. Specifically, a rapamycin loading concentration of 4% w/w has been achieved for our proprietary topical formulation while an even higher rapamycin concentration of 5% w/w has been formulated in a proprietary dermal patch system.

Research and development costs are expensed as incurred. Research and development expenses include personnel costs associated with research and development activities, including third-party contractors to perform research, conduct clinical trials and manufacture drug supplies and materials. We accrue for costs incurred by external service providers, including contract research organizations and clinical investigators, based on its estimates of service performed and costs incurred. These estimates include the level of services performed by third parties, patient enrollment in clinical trials when applicable, administrative costs incurred by third parties, and other indicators of the services completed. Based on the timing of amounts invoiced by service providers, we may also record payments made to those providers as prepaid expenses that will be recognized as expenseexpenses in future periods as the related services are rendered.

As of MarchJune 31,30, 2026, we had an accumulated deficit of $76.0$81.3 million, cash and cash equivalents balances totaling $3.1$3.8 million and investments of $10.9$7.0 million. Despite our recent financing in October 2025, based upon our current business plans and cash, cash equivalents and investments on hand, we have concluded that there is substantial doubt about our ability to continue as a going concern for a period of at least one year from the date of the filing of this Quarterly Report on Form 10-Q. We will need to raise further capital through the sale of additional equity or debt securities or other debt instruments, strategic relationships or grants, or other arrangements to support our future operations. There can be no assurance that we will be successful in accomplishing these objectives. We do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates, which we expect will take a number of years and is subject to significant uncertainty. If we are unable to improve our liquidity position, we may not be able to continue as a going concern. Our ability to continue as a going concern is dependent upon our ability to generate revenue and raise capital from financing transactions. Without such additional capital, we may be required to curtail or cease operations and be required to realize our assets and discharge our liabilities other than in the normal course of business which could cause investors to suffer the loss of all or a substantial portion of their investment.

We are a late-stage clinical specialty pharmaceutical company focused on the development and commercialization of therapeutic products that treat rare and orphan diseases for which there are currently either no approved or very limited treatments or cures. Our lead product, QRX003, is under clinical development as a potential treatment for Netherton Syndrome, a rare hereditary genetic disease. QRX003 is entering pivotal registrational clinical testing under an open IND application with the FDA. We have opened six clinical sites in the U.S. along with international sites that are being opened in the UK, Spain, France and the Netherlands. QRX003 is currently being tested in sixeight pediatric NS patients in investigator-initiateda studiesCompassionate Use program in Ireland, Austria, the Netherlands and New Zealand.Zealand and an additional 3 pediatric patients are expected to be enrolled this year. QRX003 is also being developed as a potential treatment for Peeling Skin SyndromeSyndrome. withWe thesubmitted firstan subjectIND beingapplication treatedfor QRX003 in NewPeeling Zealand.Skin We areSyndrome in the processsecond quarter of expanding2026, thiswhich was cleared by the FDA on July 9, 2026 and plan to initiate a Phase 2/3 study toin the second half of 2026. We have also entered into 9 commercial partnerships for QRX003 spanning 61 countries outside of our core commercial territories of the U.S., Western Europe and Japan. These partnership countries include upCanada, toAustralia, anNew additionalZealand, fivethe pediatricMiddle subjects.East, China, Taiwan, Hong Kong, Singapore, Israel, Central and Eastern Europe, Turkey as well as several countries in Latin America. We entered into a Research Agreement with QUT, under which we have obtained an option for a global license to QRX008 for the potential treatment of scleroderma, as well as a Research Agreement with UCC for the development of novel topical formulations of rapamycin (sirolimus), QRX009, as potential treatments for a number of rare and orphan diseases for which there are either limited or no approved therapies or cures, including Pachyonychia Congenita, Gorlin Syndrome, Tuberous Sclerosis Complex, microcystic lymphatic malformations, venous malformations and angiofibromas, as well as other indications that the Company is assessing. We are planning to initiate an investigator-led clinical studystudies in Pachyonychia Congenita led by Professor Edel O’Toole, Queen Mary University of London as well as additional investigator-led studies inCongenita, Gorlin Syndrome and Tuberous Sclerosis Complex. In addition, we are targeting to submit an IND to the FDA for QRX009 for an additional indication in Q3 2026. We have also entered into 9 commercial partnerships for QRX003 spanning 61 countries outside of our core commercial territories of the U.S., Western Europe and Japan. These partnership countries include Canada, Australia, New Zealand, the Middle East, China, Taiwan, Hong Kong, Singapore, Israel, Central and Eastern Europe, Turkey as well as several countries in Latin America.

On January 20, 2026, the Companywe filed an application for Breakthrough Medicine Designation with the Saudi Food and Drug Authority (SFDA) for QRX003 for the treatment of Netherton Syndrome. The SFDA’s Breakthrough Medicine Designation program is designed to expedite the development, review, and potential availability of medicines that address serious or life-threatening conditions with high unmet medical need and which meet SFDA eligibility requirements. If granted, the designation will allow for accelerated regulatory review and could enable earlier patient access in Saudi Arabia.

On January 27, 2026, the Companywe filed an application for Orphan Drug Designation (ODD) with the Japanese Ministry of Health, Labour and Welfare (MHLW) for QRX003 for the treatment of Netherton Syndrome. The MHLW’s Orphan Drug Designation program provides orphan status to therapies intended for the treatment, diagnosis, or prevention of rare diseases that affect fewer than 50,000 people in Japan. This designation provides certain benefits, including R&D subsidies, tax credits for qualified clinical testing, reduction of MHLW application fees, priority review and ten years of market exclusivity,exclusivity. ifOn approved.June 4, 2026, Japan’s MHLW granted the ODD designation to QRX003 for the treatment of Netherton Syndrome.

On March 11, 2026, the FDA granted Fast Track Designations to QRX003 lotion (4%) for the treatment of Netherton Syndrome On March 25, 2026, the Companywe provided a clinical and regulatory update from itsour constructive Type C meeting with U.S. FDA for QRX003 in NS (the “March Type C Meeting Minutes”) and reported that the FDA indicated that a single Phase 3 study may be sufficient to support marketing approval in the US and expressed openness to an alternate study design for Phase 3 that would likely not include a traditional upfront vehicle or placebo control.

On April 28, 2026, the Companywe provided a clinical and regulatory update for itsour QRX009 topical rapamycin development program announcing the planned initiation of an investigator-led clinical study in Pachyonychia Congenita led by Professor Edel O’Toole, Queen Mary University of London as well as additional investigator-led studies in Gorlin Syndrome and Tuberous Sclerosis Complex. In addition, thewe Companyannounced isthat we were targeting to submit an IND to the FDA for an additional indication in Q3,the third quarter of 2026.

Results of Operations – Three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025

The following table sets forth our results of operations for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025:

General and administrative expenses were approximately $1,697,000$1,846,000 and $1,583,000,$1,743,000, in the three months ended MarchJune 31,30, 2026 and 2025, respectively, representing an increase of $114,000,$103,000, or approximately 7.2%.5.9%. The increase was primarily due to an increase of $72,000$16,000 in commercial expenses, $71,000,$32,000 in payroll and benefits, $50,000$64,000 in consulting costscosts, and $40,000$50,000 in legal and professional fees,fees and $17,000 in non-cash stock-based compensation expense offset by a decrease of $58,000 in board of director fees as a result of the grant of options in lieu of cash compensation for which the expense is recognized over the vesting period of the options, $46,000$10,000 in costs associated with being a public company costs and non-cash stock-based compensation expense of $17,000.company.

Our research and development expenses during the three months ended MarchJune 31,30, 2026 and 2025 were approximately $3,434,000$3,627,000 and $2,374,000,$2,051,000, respectively, representing an increase of $1,060,000,$1,576,000, or approximately 44.7%.76.8%. The increase was primarily due to $767,000$1,045,000 in increased external expenditures on our development programs, including work related to the clinical studies for the development of QRX003,QRX003 and QRX009, an increase of payroll and benefits of $192,000$337,000 and $101,000$194,000 of non-cash stock-based compensation expense.

We amortize licensed or acquired intellectual property over its expected useful life, included in research and development expenses set out above. Amortization of intangible assets was approximately $25,000 and $25,000 in each of the three month periods ended MarchJune 31,30, 2026 and 2025.

We had approximately $133,000$2,000 in unrealized gain and $101,000 in realized and accrued interest income in the three months ended MarchJune 31,30, 2026 from our cash and cash equivalents and investments in marketable debt securities. We had approximately $145,000$6,000 in unrealized loss and $103,000 in realized and accrued interest income in the three months ended MarchJune 31,30, 2025 from our cash and cash equivalents and investments in marketable debt securities.

We have incurred net losses every year since inception and had an accumulated deficit of approximately $76.0$81.3 million at MarchJune 31,30, 2026. We have a limited operating history and have historically funded our operations through our founders’ funding expenditures and debt and equity financings. We incurred net losses of approximately $5.0$10.4 million and negative cash flows from operations of $4.9$8.0 million for the threesix months ended MarchJune 31,30, 2026. At MarchJune 31,30, 2026, we had cash and cash equivalent balances totaling $3.1$3.8 million and investments of $10.9$7.0 million. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of planned clinical trials and our expenditures on other research and development activities. Based upon our current business plans and cash, cash equivalents and investments on hand, we have concluded that there is substantial doubt about our ability to continue as a going concern for a period of at least one year from the date of the filing of this Quarterly Report on Form 10-Q. In order to address our capital needs, we intend to consider multiple alternatives, including, but not limited to, the sale of additional equity or debt securities or other debt instruments, collaborative, strategic and/or licensing relationships or grants to support our future operations. We do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates, which we expect will take a number of years and is subject to significant uncertainty. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. In addition, any exercise of our outstanding warrants is at the discretion of the warrant holders and is dependent, in part, upon the market price of our ADSs. There can be no assurance that any of our outstanding warrants will ever be in-the-money prior to their expiration and, as such, our outstanding warrants may expire without being exercised. If we are unable to improve our liquidity position, we may not be able to continue as a going concern. We continue to seek sources of financing to fund our continued operations and research and development programs. If we are unable to obtain additional funding when it becomes necessary, the development of our product candidates will be impacted and we would likely be forced to delay, reduce, or terminate some or all of our development programs or cease operations altogether, all of which could have a material adverse effect on our business, results of operations and financial condition.

Adequate additional funding may not be available to us on acceptable terms, or at all. In addition, restrictionsthe underright of participation in certain subsequent financings, which was granted to the purchasepurchasers agreement fromin our October 2025 private placementplacement, may limit our ability to raise capital. If we are unable to raise capital in sufficient amounts or on terms acceptable to us, we may have to significantly delay, scale back or discontinue the development or commercialization of QRX003,QRX003 and QRX009, any future product candidate, or potentially discontinue operations.

As of MarchJune 31,30, 2026, we had approximately $14,043,000$10,800,000 in cash and cash equivalents and investments in marketable securities. The table below presents our cash flows for the threesix month periods ended MarchJune 31,30, 2026 and 2025:

Net cash used in operating activities was approximately $4,869,000$8,013,000 and $2,594,000$6,281,000 in the threesix months ended MarchJune 31,30, 2026 and 2025, respectively. The increase in 2026 was mostly due to an increase in net loss, offset by an increase in stock basedstock-based compensation, and aan decreaseincrease in accounts payable and accrued expenses.

Net cash provided by investment activities was approximately $4,119,000$8,137,000 and $2,770,000$4,453,000 in the threesix months ended MarchJune 31,30, 2026 and 2025, respectively. The cash provided in investing activities for the threesix months ended MarchJune 31,30, 2026 consisted of net sales of US Treasury Bills and Notes. The cash provided in investing activities for the threesix months ended MarchJune 31,30, 2025 consisted of net sales of US Treasury Bills and Notes.

Net cash providedused byin financing activities was approximately $56,000$96,000 for the threesix months ended MarchJune 31,30, 2026.2026, Thewhich netincluded cashthe providedrepayments increasedof amounts due to officers of $300,000, partially offset by the receipt of approximately $206,000$204,000 in net proceeds from the exercise of warrants,warrants. partiallyNet offsetcash used by financing activities was approximately $127,000 for the six months ended June 30, 2025, which included the repayments of amounts due to officers of $150,000.$300,000, Netpartially cash providedoffset by financing activities was approximately $23,000 for the three months ended March 31, 2025. The net cash provided increased due to the receipt of approximately $173,000 in net proceeds from the exercise of warrants, partially offset by repayments of amounts due to officers of $150,000.warrants.

In October 2019, we, through our subsidiary Quoin Inc.Inc., entered into the Licensing Agreement with Skinvisible, under which Skinvisible granted us an exclusive royalty-bearing license relating to the production and manufacture of prescription drug products related to certain patents held by Skinvisible, including those related to QRX003 and QRX004. We made Skinvisible a one-time non-refundable, non-creditable license fee of $1 million (the “License Fee”). In addition, we agreed to pay Skinvisible a single digit royalty percentage of our net sales revenues for any licensed product covered by the patent rights licensed under the License Agreement. We also agreed to pay Skinvisible 25% of any revenues we receive as royalties in the event that we sublicense any licensed products to a third party. The License Agreement also requires that we make a $5 million payment to Skinvisible upon receiving approval in the U.S. or European Union, whichever occurs first, for the first drug product developed using intellectual property licensed thereunder.

In November 2020, we, through our subsidiary Quoin Inc.Inc., entered into a Master Service Agreement with Therapeutics Inc. for the management of the pre-clinical and clinical development of QRX003 for Netherton Syndrome. The initial term of the agreement was three years with automatic one-year extensions, and the agreement required the execution of individual work orders. Quoin Inc.We may terminate any work order for any reason with 90 days written notice subject to costs incurred through termination and a defined termination fee, unless there is a material breach by Therapeutics Inc. A work order was entered into in June 2022 for the first QRX003 clinical study at an expected estimated cost of approximately $4.4 million through 2024. An additional change order was entered into in December 2022 for a second QRX003 clinical study at an expected estimated cost of approximately $830,000. An amended and restated change order for the two studies was entered into in December 2024 at an estimated total remaining cost from August 2024 of approximately $3.6 million for the two studies combined. A further amended and restated change order for the additional studies initiated and planned for 2026 iswas entered into in preparationJuly between2026 thefor Companyan andexpected Therapeutics Inc ascosts of theapproximately date$3 of filing of this quarterly report on Form 10-Q.million. For the three and six months ended MarchJune 31,30, 2026 and 2025, we incurred research and development expenses under these agreements of approximately $1.1$303,000 and $1.4 million and $411,000$348,000 and $759,000 respectively. During the three months ended June 30, 2026, the Company received a credit of approximately $377,000 applied to prior expenses incurred during the period of November 2025 to March 2026.

In November 2021, we entered into a research agreement with Queensland University of Technology (QUT) for a pre-clinical research program for the development of a product to treat Netherton Syndrome of approximately $250,000. In May 2022, we entered into a second research agreement with QUT for the development of a product to treat Scleroderma of approximately $610,000. Each agreement remains in place until the completion of the research program, which in each case was initially anticipated to be 18 months from execution. For the three and six months ended MarchJune 31,30, 2026 and 2025, we incurred de-minimisno research and development costs related to these agreements. In July 2025 we announced that, in light of the expected near-term completion of the QRX003 clinical program for Netherton Syndrome, we have discontinued the Netherton Syndrome research program with QUT. We are planning to schedule a meeting with QUT to discuss the future direction of the Scleroderma research program.

On June 10, 2024, we entered into a research agreement with The School of Pharmacy at UCC. The scope of the agreement encompasses the development of novel topical formulations of Rapamycin (sirolimus) as potential treatments for a number of rare and orphan diseases for which there are currently very limited or no approved therapies or cures. Under the terms of the agreement, based on the achievement of certain milestones, we will fund up to approximately €567,000 ($655,000) plus VAT over an anticipated 2-1/2 year period to support the UCC research program to investigate the development of a number of topical rapamycin formulations for future development as potential treatments for several rare and orphan diseases. Following completion of the research program, we will have the option to advance the clinical development of rapamycin formulations developed by UCC. Work on this research project commenced in December 2024. For the three and six months ended MarchJune 31,30, 2026 and 2025, we incurred research and development expenses under these agreements of approximately $0 and $0 and $60,000 and $120,000 respectively.

In February 2026, wewe, through our subsidiary Quoin Inc., signed a research agreement with Evestia Clinical Limited for the management of the UK and European clinical development of QRX003 for Netherton Syndrome. The initial term of the agreement is five years and the agreement requires the execution of individual work orders. Quoin Inc.We may terminate any work order for any reason with 30 days written notice subject to costs incurred through termination and a defined termination fee, unless there is a material breach by Evestia Clinical Limited. A work order was entered into in March 2026 for the first QRX003 UK and European clinical study at an expected estimated cost of approximately $800,000. For the three and six months ended MarchJune 31,30, 2026, we incurred research and development expenses under this agreement of approximately $64,000.$280,000 and $344,000 respectively.