NASDAQ: INDP

Recent
Developments

Lazar
Investment Transaction

On
December 22, 2025, we entered into the Purchase Agreement with Mr. Lazar, pursuant to which he agreed to purchase from us 300,000 shares
of Series AA Preferred Stock and 700,000 shares of Series AAA Preferred Stock at a purchase price of $6.00 per share of Preferred Stock
for aggregate gross proceeds of $6.0 million, subject to the terms and conditions thereunder. The offering closed on December 23, 2025.

Pursuant
to the Purchase Agreement, we held a special meeting of stockholders on February 26, 2026, where the stockholders approved the following
actions (i) the issuance of common stock to Mr. Lazar in compliance with the rules and regulations of Nasdaq (without regard to any limitations
on conversion set forth in the applicable Certificate of Designations) upon conversion of the shares of Preferred Stock, (ii) an amendment
to our amended and restated certificate of incorporation that increases the authorized shares of common stock from 200,000,000 to 1,000,000,000
shares at the discretion of the Board, (iii) an amendment to our amended and restated certificate of incorporation that permits future
shareholder action by written consent of the majority of shareholders, (iv) the election of Jerome Jabbour as Class I and Matthew McMurdo
as Class III directors (each a designee of Mr. Lazar) to the Board of Directors to serve until the 2028 and 2027 annual meeting of stockholders,
respectively, and (v) a reverse stock split of the common stock of the Company in the range to be determined by the Board.

Each
share of Series AA Preferred Stock is convertible into 20 shares of our common stock and each share of Series AAA Preferred Stock is
convertible into 150 shares of common stock for a combined total of 111,000,000 shares of common stock.

In
connection with the Investment Transaction, our past Board members Mr. Robert E. Martell and Ms. Hila Karah resigned from the Board and
Mr. Lazar and Mr. Avraham Ben-Tzvi (a designee of Mr. Lazar) were appointed to fill the vacancies created by their resignations. Both
Mr. Lazar and Mr. Ben-Tzvi currently serve as Class I directors with a term expiring at our 2028 annual meeting of stockholders. Mr.
Lazar was appointed as the Chairman of the Board taking over the role held by Dr. Roger Pomerantz. However, Dr. Pomerantz continued
to serve as a member of the Board of Directors. Additionally, the Board appointed David Natan, also a designee of Mr. Lazar, to the Board
effective January 7, 2026 as a Class II member to serve for a term ending at the 2026 annual meeting of stockholders.

Further,
pursuant to the terms of the Purchase Agreement, we entered into employment modification agreements with each of Jeffrey A. Meckler,
Michael J. Newman, Ph.D., Nir Sassi and Walt A. Linscott, Esq. (collectively, the “Executive Officers”). Pursuant to the
terms of the employment modification agreements, or the Modification Agreements, each of the Executive Officers agreed to remain employed
in their existing roles except for Mr. Meckler who agreed to change his title to Co-Chief Executive Officer. The Executive Officers agreed
to modify certain terms of their original employment agreements, granted release of claims relating to their employment, and received
certain cash and equity payments at the closing of the Investment Transaction. More recently, in January of 2026, the employment agreements
of Mr. Meckler and Mr. Newman were further amended whereby their salaries were reduced to $60,000 per annum. Further, pursuant to the
Investment Transaction, each of the Executive Officers entered into a voting agreement, dated December 22, 2025, pursuant to which each
of the Executive Officers agreed, in their capacity as stockholders of the Company, to vote all of their shares of common stock in favor
of all proposals at the special meeting of stockholders held on February 26, 2026.

As
indicated above, following the Investment Transaction, we plan to pursue a strategic transaction involving either an investment in or
acquisition of a Target Company. Should such a transaction be approved and successfully finalized, the Company anticipates that combining
with a Target Company will create future growth opportunities for both the Company and its stockholders. We are currently in the process
of evaluating our strategic options for a Post-Investment Transaction.

Warrant
Repricing

On
February 11, 2026, we entered into warrant repricing agreements, or the Repricing Agreements, with certain holders, or the Executing
Holders, of warrants to purchase an aggregate of 913,638 shares of our common stock that were originally issued in financing rounds during
2024 and 2025 (financing rounds discussed below) at exercise prices ranging from $8.30 to $47.60 (the “Executing Warrants”).
Pursuant to the Repricing Agreements, we agreed to reduce the per share exercise prices of the Executing Warrants to $1.75, which is
equal to the “Minimum Price” as calculated in accordance with the Nasdaq rules, or the Exercise Price Reduction. As a condition
to the Exercise Price Reduction, the Executing Holders agreed to enter into a voting agreement pursuant to which the Executing Holders
agreed to vote all of the shares of common stock held by the Executing Holders in favor of all proposals at the special meeting of stockholders
held on February 26, 2026.

In
addition, on February 11, 2026, with respect to the remaining warrants and placement agent warrants to purchase an aggregate of 762,787
shares of common stock that were issued in the same financing rounds described above, our Board of Directors unilaterally reduced their
per share exercise prices to $1.75. Other than the reduction in the per share exercise price, all other terms and provisions of the warrants
described above remained unchanged.

6

ATM
Offering

In
June 2022, we entered into an at-the-market offering agreement (the “ATM Agreement”) with H.C. Wainwright & Co. LLC (“Wainwright”),
which was amended on September 1, 2022, relating to the offer and sale of shares of our common stock having an aggregate offering price
of up to $6.3 million. The issuances and sales of common stock by us under the ATM Agreement were being made pursuant to “shelf”
registration statements on Form S-3 filed with the SEC on September 1, 2022 and declared effective on September 9, 2022 and most recently
on August 13, 2025 and declared effective on August 20, 2025. Our ability to issue shares under the shelf registration statement on Form
S-3 is limited by General Instruction I.B.6 to Form S-3. In September 2025, we sold 520,000 shares of our common stock for aggregate
gross proceeds of approximately $2.3 million.

June
2025 Convertible Note Financing

In
June 2025, we completed a private placement, or the June 2025 Financing, of convertible notes to certain investors, including our then
Chief Executive Officer, Jeffrey Meckler, in the aggregate principal amount of approximately $5.7 million and warrants to purchase shares
of common stock. The notes automatically converted in July 2025 into 501,566 shares of our common stock and pre-funded warrants to purchase
190,795 shares of our common stock at a conversion price of $8.30 per share. In connection with the offering, we also issued to the investors
warrants to purchase 1,384,722 shares of our common stock, exercisable at $8.30 per share and expiring on July 27, 2030. The warrants
issued in the June 2025 Financing were the subject of warrant repricing completed in February 2026. See “Warrant Repricing”
on page 6 of this Annual Report.

Reverse
Split

On
June 26, 2025, we effected a 1-for-28 reverse stock split of our common stock and began trading on a post-split basis on the Nasdaq Capital
Market on June 27, 2025, which resulted in our regaining compliance with Nasdaq’s minimum bid price requirement. As a result of
the reverse stock split, every 28 shares of outstanding common stock were combined into one share of common stock. The reverse stock
split decreased our outstanding common stock from 16,946,528 shares to 604,963 shares as of that date. In addition, a proportionate adjustment
was made to the per share exercise price and the number of shares issuable upon the exercise of all outstanding options and warrants
entitling the holders to purchase common stock. All share and per share amounts in this annual report on Form 10-K and the consolidated
financial statements have been retroactively adjusted to reflect the reverse stock split.

February
2025 Equity Line

On
February 12, 2025, we entered into a Standby Equity Purchase Agreement, or the SEPA with YA II PN, LTD., a Cayman Islands exempt
limited company, or Yorkville. Pursuant to the SEPA, we have the right, but not the obligation, to sell to Yorkville from time to
time up to $20.0 million of our common stock, during the 36 months following the execution of the Purchase Agreement, subject to the
restrictions and satisfaction of the conditions in the SEPA. At our option, the shares of common stock would be purchased by
Yorkville from time to time at a price equal to 97% of the lowest of the three daily VWAPs during a three consecutive trading day
period commencing on the date that we, subject to certain limitations, deliver a notice to Yorkville that the Company is committing
Yorkville to purchase such shares of common stock. We may also specify a certain minimum acceptable price per share in each Advance.
As consideration for Yorkville’s irrevocable commitment to purchase our shares, we issued to Yorkville 10,927 shares of common
stock. Under the applicable rules of Nasdaq and pursuant to the SEPA, in no event may we issue or sell to Yorkville more than
100,830 shares of common stock, or the Exchange Cap, which is 19.99% of the shares of common stock outstanding immediately prior to
the execution of the SEPA, unless (i) we obtain stockholder approval to issue shares of common stock in excess of the Exchange Cap
or (ii) the average price of all applicable sales of common stock under the SEPA equals or exceeds $22.882 per share (which
represents the lower of (i) the Nasdaq Official Closing Price (as reflected on Nasdaq.com) on the trading day immediately preceding
the effective date or (ii) the average Nasdaq Official Closing Price of the common stock (as reflected on Nasdaq.com) for the five
trading days immediately preceding the effective date). In addition, effective February 12, 2025, we terminated the purchase
agreement that we entered into with Lincoln Park Capital Fund, LLC in December 2022. As of March 16, 2026, we sold and issued 89,902
shares of common stock under the SEPA for aggregate net proceeds of approximately $1.74 million, after deducting offering expenses
in the amount of approximately $0.1 million. Effective March 11, 2026, we terminated the SEPA with Yorkville, and the SEPA is no
longer in effect.

7

January
2025 Financing

On
January 12, 2025, we entered into securities purchase agreements, or the January 2025 Purchase Agreements, with certain institutional
and accredited investors, or the January 2025 Purchasers. The January 2025 Purchase Agreements provide for the sale and issuance by us
of an aggregate of: (i) 75,335 shares of our common stock and (ii) warrants to purchase 75,335 shares of common stock in a private placement,
or the January 2025 Warrants. The shares and January 2025 Warrants were sold on a combined basis for consideration of $29.82 for one
share and a January 2025 Warrant. The exercise price of the January 2025 Warrants is $26.32 per share.

The
January 2025 Warrants were immediately exercisable upon issuance and will expire five years following the date of issuance. The January
2025 Warrants contain standard adjustments to the exercise price including for stock splits, stock dividends and reorganizations. In
lieu of making the cash payment otherwise contemplated to be made upon exercise in payment of the aggregate exercise price, the holder
may, in the event the shares underlying the January 2025 Warrants are not registered under the Securities Act, elect instead to receive
upon such exercise (either in whole or in part) the net number of shares of common stock determined according to a formula set forth
in the January 2025 Warrants. Under the terms of the January 2025 Warrants, a holder (together with its affiliates) may not exercise
any portion of its January 2025 Warrant to the extent that the holder would beneficially own more than 4.99% or 9.99%, depending on the
individual investor, of the outstanding common stock immediately after exercise, or the Beneficial Ownership Limitation, except that
upon at least 61 days’ prior notice from the holder to us, the holder may increase the Beneficial Ownership Limitation, provided
that the Beneficial Ownership Limitation in no event exceeds 19.99%.

Paulson
Investment Company, LLC, or Paulson, served as the exclusive placement agent for the issuance and sale of the securities. As compensation
for such placement agent services, we paid Paulson an aggregate cash fee equal to 7.0% of the gross proceeds received by us from the
offering, and a non-accountable expense of $25,000. As additional compensation to Paulson, we issued to Paulson (or its designees) a
warrant, or the January 2025 Placement Agent Warrants, to purchase an aggregate of 5,273 shares at an exercise price per share equal
to $32.9 per share. The January 2025 Placement Agent Warrants are exercisable six months from the date of issuance and expire on the
fifth anniversary of the issue date. The January 2025 Warrants and the January 2025 Placement Agent Warrants were the subject of warrant
repricing completed in February 2026. See “Warrant Repricing” on page 6 of this Annual Report.

November
2024 Financing

On
November 22, 2024, we entered into securities purchase agreements, or the November 2024 Purchase Agreements, with certain institutional
and accredited investors, or the November 2024 Purchasers. The November 2024 Purchase Agreements provide for the sale and issuance by
us of an aggregate of: (i) 64,893 shares of our common stock in a registered direct offering and (ii) warrants to purchase 64,893 shares
of common stock in a private placement, or the November 2024 Warrants. The shares and November 2024 Warrants were sold on a combined
basis for consideration of $32.9 for one share and a November 2024 Warrant. The exercise price of the November 2024 Warrants is $29.4
per share. One of the November 2024 Purchasers was our then Chief Executive Officer, Mr. Jeffrey Meckler, who purchased 1,519 shares
and November 2024 Warrants to purchase 1,519 shares, or the Affiliate Securities, at the same price and upon the same terms as the other
November 2024 Purchasers.

The
November 2024 Warrants were immediately exercisable upon issuance and will expire five years following the date of issuance. The November
2024 Warrants contain standard adjustments to the exercise price including for stock splits, stock dividends and reorganizations. In
lieu of making the cash payment otherwise contemplated to be made upon exercise in payment of the aggregate exercise price, the holder
may, in the event the shares underlying the November 2024 Warrants are not registered under the Securities Act, elect instead to receive
upon such exercise (either in whole or in part) the net number of shares of common stock determined according to a formula set forth
in the November 2024 Warrants. Under the terms of the November 2024 Warrants, a holder (together with its affiliates) may not exercise
any portion of its November 2024 Warrant to the extent that the holder would beneficially own more than the Beneficial Ownership Limitation,
except that upon at least 61 days’ prior notice from the holder to us, the holder may increase the Beneficial Ownership Limitation,
provided that the Beneficial Ownership Limitation in no event exceeds 19.99%.

8

Paulson
served as the exclusive placement agent for the issuance and sale of the securities. As compensation for such placement agent services,
we paid Paulson an aggregate cash fee equal to 7.0% of the gross proceeds received by us from the offering (excluding the Affiliate Securities),
and a non-accountable expense of $25,000. As additional compensation to Paulson, we issued to the Paulson (or its designees) a warrant,
or the November 2024 Placement Agent Warrants, to purchase an aggregate of 4,436 shares at an exercise price per share equal to $36.75
per share. The November 2024 Placement Agent Warrants are exercisable six months from the date of issuance and expire on the fifth anniversary
of the issue date. The November 2024 Warrants and the November 2024 Placement Agent Warrants were the subject of warrant repricing completed
in February 2026. See “Warrant Repricing” on page 6 of this Annual Report.

August
2024 Financing

On
August 8, 2024, we completed a registered direct offering, pursuant to which we sold and issued to certain investors, including one of
our officers, 58,708 shares of common stock. In addition, in a concurrent private placement, we issued to the investors unregistered
warrants to purchase 58,708 shares of common stock, or the August 2024 Private Placement. The warrants were immediately exercisable at
an exercise price of $47.60 per share and expire five years from the date of issuance. The combined purchase price for one share of common
stock and one warrant was $51.1, resulting in gross proceeds of approximately $3.0 million, before deducting placement agent and other
offering expenses in the amount of approximately $0.5 million. The warrants issued in the August 2024 Private Placement were the subject
of warrant repricing completed in February 2026. See “Warrant Repricing” on page 6 of this Annual Report.

Background

Approved
immunotherapies, such as Interluekin-2, Interferon-alpha and the more recently approved “checkpoint” and CAR-T therapies
produce durable responses in a few percent to about fifty percent of patients across about a dozen out of over one hundred different
types of cancer. Although checkpoint therapies are able to effectively cure many previously incurable patients, only about 15% of patients
receiving this type of therapy respond. The main limitation of existing immunotherapies is that they each activate only one or a small
number of key steps in either the innate or adaptive immune system, but there is general agreement that highly efficient cancer immunotherapy
will require activation of both innate and adaptive immunity. The human body’s innate and adaptive immune systems are each capable
of cell-mediated destruction of tumors if the tumor cells are recognized as foreign or damaged. Activation of innate and adaptive responses
is also dependent on immune cells sensing the presence of “danger.” The most potent immune cell activating danger signals
are released by bacteria and viruses in the setting of infection, and include agonists of immune cell receptors, such as Toll-Like (TLR),
NOD and STING. Bacterial danger signals, including TLR agonists are called pathogen-associated molecular patterns (PAMPs) and can activate
both innate and adaptive immune cells, including antigen-presenting cells, promoting innate (NK, macrophage) and adaptive (T cell-mediated)
destruction of tumors.

The
oldest form of cancer immunotherapy involves the provision of decoy danger signals from bacteria. It was based on the long-standing observation
of tumor regression in the setting of bacterial infection. Treatment of cancer patients with heat-killed bacteria, or Coley’s toxins,
was established in 1891 and used for 70 years with significant success. For example, ≥5-year survival was reported for 45% of 432
inoperable sarcoma, lymphoma, melanoma, and carcinoma patients. Despite this success, several limitations led to the abandonment of this
approach by the pharmaceutical industry. Although there was an indication that Coley’s toxins worked best when administered intravenously
(i.v.), it was too toxic when given by this route, limiting the approach to local administration, which produced highly variable results.
Another limitation was lack of knowledge about the mechanism of action, preventing optimization and standardization of manufacturing,
leading to another source of variability in clinical response. Due to this high variability, Coley’s toxins was not grandfathered-in
as an approved drug by the FDA in 1963 and was supplanted by radiation and chemotherapy, despite the fact that these more modern approaches
rarely produce durable responses in advanced cancer patients. Scientists now understand the mechanism of action of Coley’s toxins.
Gram-negative bacteria contain multiple immune-stimulating danger signals, including TLR agonists such as lipopolysaccharide (LPS). Bacteria
and purified or mono-specific TLR agonists, including LPS derivatives, have been validated and approved for prevention and treatment
of early stage cancer. However, a safe and effective TLR agonist-based approach for advanced cancer has been elusive, possibly due to
limitations in the ability of intratumorally administered, mono-specific TLR agonists to induce potent, systemic anti-tumor immune responses.
In addition, the intratumoral approach is not feasible with all tumor types or patients. Our hypothesis is that an effective TLR agonist-based
immunotherapy for advanced cancer will require invention of a packaged, multi-TLR agonist or multi-danger signal product that is modified
or attenuated to allow safe i.v. administration.

9

Our
Approach

Our
patented approach is based on the hypothesis that efficient activation of both innate and adaptive immune cells and associated anti-tumor
immune responses can be achieved by using intact bacteria, containing multiple PAMPs, which have been attenuated so that they can be
administered safely intravenously. Because LPS appears to be the most important contributor to both toxicity and efficacy, our patented
product candidates are single strains of killed, non-pathogenic Gram-negative bacteria that have been treated in an effort to kill the
bacteria and significantly reduce, but not completely eliminate, the cell surface LPS-endotoxin activity. Our product candidates are
designed to have enhanced sufficient residual LPS to synergize with other PAMPs in the bacteria to efficiently prime innate and adaptive
immune pathways. This approach has led to broad anti-tumor and anti-viral activity in preclinical models, including durable anti-tumor
response synergy observed with each of four different classes of existing agents, including NSAIDs, checkpoint therapy, targeted antibody
therapy and low-dose chemotherapy. Tumor eradication by our technology is designed to produce both innate and adaptive immunological
memory and, importantly, not require provision of an exogenous tumor antigen, potentially due to the ability of LPS and other PAMPS to
activate dendritic cells that have already captured a tumor antigen.

All
immune cells can participate in killing of tumors and viruses. As illustrated below, current therapies activate only one or a small subset
of both pathways and cure only a small percentage of patients.

Our
technology, however, is designed to synergize with existing therapies to activate both innate and adaptive immune cells, inducing efficient
anti- tumor immune responses with a wide safety margin. Induction of adaptive anti-tumor immune responses and immunological memory by
our technology does not require an exogenous tumor antigen.

10

Innate
and adaptive immune responses require identification of a tumor as foreign or not self. However, most steps required for migration and
activation of immune cells are unrelated to the tumor or are tumor non-specific. All innate and adaptive non-specific steps are induced
or promoted by immune system “danger signal” molecules, such as those found in our bacteria. Bacteria-derived danger signals
are also able to enhance the processing and recognition of tumor antigens, which are frequently present, but not “seen” by
the immune system.

Results

Preclinical
Trials

In
preclinical models, Indaptus treated bacteria induced less systemic toxicity than untreated bacteria but were still able to activate
innate and adaptive immune responses. Despite exhibiting reduced in vivo pyrogenicity and a higher maximally tolerated dose, our bacteria
were able to induce secretion of most cytokines and chemokines from mouse and human immune cells in vitro at levels comparable to those
seen with untreated bacteria. Our bacteria were also able to synergize with human immune cells to kill human tumor cells in vitro.

We
have observed significant single agent anti-tumor activity and/or combination therapy-mediated regression with durable responses in established
non-Hodgkin’s lymphoma, as well as colorectal, hepatocellular and pancreatic carcinoma in preclinical syngeneic and human tumor
xenograft models. Our bacteria synergized with each of four different classes of approved agents in preclinical models, including NSAIDs,
checkpoint therapy, targeted antibody therapy and low-dose chemotherapy to induce tumor regression, providing significant flexibility
for targeting of diverse types of cancer. Our technology is designed to eradicate tumors via activation of both innate (NK cell) and
adaptive (CD4+ and CD8+ T cell) mechanisms, with the goal of producing both innate and adaptive immunological memory. In our preclinical
studies, tumor eradication occurred at non-toxic doses of our bacteria, with a very wide (10 to ≥33-fold) therapeutic index. Notable
mechanism of action information has also been obtained, via gene expression analysis with treated tumors and plasma cytokine analysis,
demonstrating that our combination technology has the potential to turn “cold” tumors into “hot” tumors and induce,
activate or recruit innate and adaptive genes, cells and pathways. Immune cell pre-depletion studies have demonstrated that both innate
(NK) and adaptive (CD4 T and CD8 T) immune cells are involved in tumor eradication. We have also demonstrated significant single agent
activity against chronic Hepatitis B virus (HBV) and human immunodeficiency virus (HIV) infection in standard preclinical models.

11

We
have carried out successful cGMP manufacturing and stability studies with our lead product candidate, Decoy20. In addition, IND-enabling
multi-dose toxicology studies have been completed and did not produce sustained induction of factors that are associated with cytokine
release syndrome.

The
chart above demonstrates that our bacteria synergize with Anti-PD-1 Checkpoint therapy to regress established mouse hepatocellular carcinoma
(HCC) Tumors. All mice (all groups) received a low-dose, non-steroidal anti-inflammatory drug (NSAID/Indomethacin), which increases the
number of regressions in the combination setting. Most regressions were durable, with 5/6 combination regressions stable through termination
at Day 91 and in a repeat experiment through termination at Day 143 (see next Figure below) (CR = complete response or complete regression).
The repeat experiment also produced 5/6 or 6/6 durable regressions per group over a 33-fold Indaptus concentration range and an absence
of safety concerns, demonstrating a very wide therapeutic index. Similar tumor eradication results have been obtained by combining our
bacteria with low-dose chemotherapy in a mouse non-Hodgkin’s lymphoma model. Eradication of established non-Hodgkin’s lymphoma
tumors by our technology has also been observed with human tumor xenografts, via activation of the innate immune system. Development
and preclinical efficacy characterization of a systemically administered multiple Toll-like receptor (TLR) agonist for antitumor immunotherapy
[abstract]. In: Proceedings of the Fourth CRI-CIMT-EATI-AACR International Cancer Immunotherapy Conference: Translating Science into
Survival; Sept 30-Oct 3, 2018; New York, NY. Philadelphia (PA): AACR; Cancer Immunol Res 2019;7(2 Suppl):Abstract
nr B178.

The
chart above illustrates that the synergistic tumor eradication by our technology and Anti-PD-1 produces immunological memory. Established
tumors were regressed in 11 mice by combination treatment as in the Figure above and then the mice were re-challenged with fresh HCC
tumor cells, without further treatment. All of the new tumors were rejected. Similar results have been obtained by combining our bacteria
with low-dose chemotherapy in a non-Hodgkin’s lymphoma model.

12

Clinical
Trials

In
May 2022, the U.S. Food and Drug Administration, or the FDA, allowed us to proceed under our IND for a Phase 1 clinical trial in patients
with advanced solid tumors where currently approved therapies have failed. In December 2022, we initiated an open label, multi-center,
dose escalation and expansion, single arm (monotherapy) Phase 1 study conducted in 2 parts. The Phase 1 study began with single dose
administration and was followed with continuous weekly dosing of Decoy20 in tumor-specific expansion cohorts. The study enrolled patients
with any one of six advanced/metastatic solid tumors, who have exhausted approved treatment options. The study’s objectives were
to assess the safety and tolerability of Decoy20, to determine the maximum tolerated dose, the optimal biologically active and recommended
Phase 2 dose, as well as to assess Decoy20 pharmacokinetics (PK), pharmacodynamics and clinical activity. The primary endpoints of the
study were incidence, relatedness and severity of adverse events and treatment-emergent adverse events and determining the number of
subjects per cohort with dose limiting toxicity-based adverse events. Secondary endpoints included the incidence of anti-drug antibodies
and neutralizing antibodies pre- and post-treatment, change in Decoy20 PK parameters over time, objective response rate and duration
of response.

In
August 2023, we evaluated the first four patients who received a single dose of 7 x 10^7 Decoy20 in Part 1 of the Phase 1 clinical trial.
All four patients who enrolled were evaluable in the first cohort. These patients experienced generally anticipated transient adverse
events including hemodynamic changes such as changes in pulse or blood pressure that resolved within 30 minutes and laboratory abnormalities
such as grade 1-3 elevations in transaminases (liver function tests) and grade 4 reductions in lymphocytes that generally resolved within
three days. One patient had a dose-limiting toxicity of grade 3 bradycardia (slow heart rate) and grade 2 hypotension (low blood pressure)
which resolved within approximately 90 minutes with i.v. fluids. Patients also experienced transient induction of over 50 different biomarkers
associated with innate and adaptive anti-tumor immune responses. After the end of infusion, Decoy20 was cleared from the blood within
30 to 120 minutes. Peak cytokine and chemokine induction occurred within ~4 to 24 hours and most cytokine/chemokines returned to the
patient’s respective baseline by 24-72 hours. This rapid clearance and associated transient cytokine/chemokine induction are desired
to avoid prolonged toxicity, often associated with longer term cytokine exposure.

In
September 2023, we began the second cohort of the Phase 1 clinical trial after receiving authorization from the Safety Review Committee.
The second cohort dose was a reduction from 7 x 10^7 Decoy20 dose to 3 x 10^7 Decoy20. In March 2024, we completed the second cohort
of patients who received a single dose of 3 x 10^7 Decoy20 in Phase 1 of the clinical trial. Patients on the second (lower dose) cohort
experienced adverse events similar in frequency and severity to the higher dose cohort with one dose-limiting toxicity of grade 3 ALT
elevation that required one week to resolve. Pharmacodynamic effects included transient induction of multiple biomarkers. Clearance of
Decoy20 was similarly rapid. Following authorization from the Safety Review Committee, we advanced into the weekly dosing part of the
trial.

In
May and June 2024, we enrolled two additional patients in the first cohort who received a single dose of 7 x 10^7 Decoy20, and in August
2024 we received the authorization from the Safety Review Committee to initiate the weekly dosing with 7 x 10^7 Decoy20.

As
of October 2024, we completed one month of the weekly dosing part in the first six participants at the 3 x 10^7 Decoy20 dose and following
the review of the safety data by the Safety Review Committee we received the authorization to initiate unrestricted enrollment of participants
at the 3 x 10^7 Decoy20 dose. By May 2025, we had enrolled 13 participants on Decoy20 as a single dose and 32 participants in the weekly
dosing among the two Decoy20 dose levels. In May 2025, we decided to conclude enrollment in the weekly dosing and focus on the Combination Study, as further described below. We have observed early signs of potential benefits emerging with some
participants with stable disease. As expected with the mechanism of action of Decoy20, we have seen adverse events of cytokine release
syndrome (CRS) in six participants that have resolved within 24-72 hours.

In
October 2024, we entered into a clinical supply agreement, or the Supply Agreement, with BeOne Medicines (formerly known as BeiGene Switzerland
GmbH), to advance clinical evaluation of Decoy20 in combination with BeOne’s anti-PD-1 antibody, Tislelizumab, or the BeOne Product,
for the treatment of participants with advanced solid tumors, or the Combination Study. This Combination Study builds on preclinical
results where Decoy20, combined with a PD-1 inhibitor, demonstrated tumor eradication. By November 2025, we had enrolled six evaluable
participants in the Combination Study, and we have seen one related serious adverse event of CRS in one participant that has resolved
within 72 hours. Following initial efficacy evaluations, we had three participants who experienced disease progression and had to discontinue
from the study, and we had evidence of stable disease assessment in three subjects. Of the three stable disease participants, one subject
with squamous cell carcinoma of the head and neck developed disease progression at the next restaging assessment and discontinued from
the study; one subject with pancreatic adenocarcinoma maintained stable disease with Decoy20 for more than four months, with tislelizumab
held between weeks 10-20 for autoimmune thyroiditis, before discontinuing after 6 months with disease progression; and the third subject
with hepatocellular carcinoma had stable disease for four months before discontinuing for disease progression after six months. The Combination
Study assessed safety, dose optimization, and early signs of anti-tumor activity in participants with advanced solid tumors, previously
treated with a checkpoint inhibitor or with tumors typically unresponsive to checkpoint inhibitors. Currently, we have discontinued further
enrollment and there are no participants remaining in the study. We do not have any current plans to initiate a new clinical trial.

Under
the terms of the Supply Agreement, we covered all costs associated with the Combination Study, excluding the cost of the BeOne
Product. BeOne supplied the BeOne Product for use in the study, and we supplied Decoy20 for the purposes of the Combination Study.
Following the discontinuation of the Combination Study, we provided BeOne notice of termination per the Supply Agreement.

Historically,
we have operated virtually with a team of highly experienced consultants and advisors, carrying out research and development at contract
research organizations (CROs). We have developed patented treatment methods (and associated patented compositions) for attenuation and
killing of non-pathogenic, Gram-negative bacteria. Since our inception, we have funded our operations
primarily through public and private offerings of our equity securities.

Governmental
Regulation

Among
others, the FDA and comparable regulatory authorities in state and local jurisdictions and in other countries impose substantial and
burdensome requirements upon companies involved in the clinical development, manufacture, marketing and distribution of drugs such as
those we are developing. These agencies and other federal, state and local entities regulate, among other things, the research and development,
testing, manufacture, quality control, safety, effectiveness, labeling, storage, record keeping, approval, advertising and promotion,
distribution, post-approval monitoring and reporting, sampling and export and import of our product candidates.

13

U.S.
Regulation of Drugs and Biologics

In
the United States, the FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act (FDCA) and its implementing regulations, and
biologics under the FDCA and the Public Health Service Act (PHSA) and its implementing regulations. FDA approval is required before any
new unapproved drug or dosage form, including a new use of a previously approved drug, can be marketed in the United States. Drugs and
biologics are also subject to other federal, state, and local statutes and regulations. The process required by the FDA before product
candidates may be marketed in the United States generally involves the following:

●
completion
of extensive preclinical laboratory tests, animal studies and formulation studies, performed in accordance with the Good Laboratory
Practices (GLP) regulations and other applicable regulations;

●
submission
to the FDA an IND, which must become effective before human clinical studies may begin and must be updated annually;

●
approval
by an independent institutional review board (IRB) or ethics committee representing each clinical site before each clinical study
may be initiated;

●
performance
of adequate and well-controlled human clinical studies in accordance with Good Clinical Practice (GCP), requirements to establish
the safety and efficacy, or with respect to biologics, the safety, purity and potency of the product candidate for each proposed
indication;

●
preparation
of and submission to the FDA of a new drug application (NDA) or biologics license application, (BLA), after completion of all pivotal
clinical studies;

●
a
determination by the FDA within 60 days of its receipt of an NDA or BLA to file the application for review;

●
potential
review of the product application by an FDA advisory committee, where appropriate and if applicable;

●
satisfactory
completion of an FDA pre-approval inspection of the manufacturing facilities where the proposed product drug is produced to assess
compliance with cGMP, to assure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength,
quality and purity, and of potential inspection of selected clinical investigation sites to assess compliance with GCPs; and

●
FDA
review and approval of an NDA or BLA prior to any commercial marketing or sale of the drug in the United States.

Once
a product candidate is identified for development, it enters the preclinical testing stage. Preclinical tests include laboratory evaluations
of product chemistry, toxicity and formulation, as well as animal studies. An IND sponsor must submit the results of the preclinical
tests, together with manufacturing information and analytical data, to the FDA as part of an IND. An IND is a request for authorization
from the FDA to administer an investigational drug product to humans. An IND will also include a protocol detailing, among other things,
the objectives of the clinical trial, the parameters to be used in monitoring safety, and the effectiveness criteria to be evaluated,
if the trial includes an efficacy evaluation. Some preclinical testing may continue even after the IND is submitted. The IND automatically
becomes effective 30 days after receipt by the FDA, unless the FDA, within the 30-day time period, places the clinical trial on a clinical
hold. In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. Clinical
holds also may be imposed by the FDA at any time before or during clinical trials due to safety concerns about on-going or proposed clinical
trials or non-compliance with specific FDA requirements, and the trials may not begin or continue until the FDA notifies the sponsor
that the hold has been lifted.

All
clinical trials must be conducted under the supervision of one or more qualified investigators in accordance with GCPs, which include
the requirement that all research subjects provide their informed consent in writing for their participation in any clinical trial. Clinical
trials must be conducted under protocols detailing the objectives of the trial, dosing procedures, subject selection and exclusion criteria
and the safety and effectiveness criteria to be evaluated. Each protocol must be submitted to the FDA as part of the IND, and a separate
submission to the existing IND must be made for each successive clinical trial conducted during product development and for any subsequent
protocol amendments. While the IND is active, progress reports summarizing the results of the clinical trials and nonclinical studies
performed since the last progress report, among other information, must be submitted at least annually to the FDA, and written IND safety
reports must be submitted to the FDA and investigators for serious and unexpected suspected adverse events, findings from other studies
suggesting a significant risk to humans exposed to the same or similar drugs, findings from animal or in vitro testing suggesting a significant
risk to humans, and any clinically important increased incidence of a serious suspected adverse reaction compared to that listed in the
protocol or investigator brochure.

14

Furthermore,
an independent IRB at each institution participating in the clinical trial must review and approve each protocol before a clinical trial
commences at that institution and must also approve the information regarding the trial and the consent form that must be provided to
each trial subject or his or her legal representative, monitor the study until completed and otherwise comply with IRB regulations. The
FDA or the sponsor may suspend a clinical trial at any time on various grounds, including a finding that the research subjects or patients
are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution
if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the drug has been associated with
unexpected serious harm to patients. In addition, some clinical trials are overseen by an independent group of qualified experts organized
by the sponsor, known as a data safety monitoring board or committee. Depending on its charter, this group may determine whether a trial
may move forward at designated check points based on access to certain data from the trial. There are also requirements governing the
reporting of ongoing clinical studies and clinical study results to public registries, including clinicaltrials.gov.

The
clinical investigation of a drug is generally divided into three phases. Although the phases are usually conducted sequentially, they
may overlap or be combined.

●
Phase
1. The product candidate is initially introduced into healthy human subjects or patients with the target disease or condition. These
studies are designed to test the safety, dosage tolerance, absorption, metabolism and distribution of the investigational product
in humans, the side effects associated with increasing doses, and, if possible, to gain early evidence on effectiveness.

●
Phase
2. The product candidate is administered to a limited patient population with a specified disease or condition to evaluate the preliminary
efficacy, optimal dosages and dosing schedule and to identify possible adverse side effects and safety risks. Multiple Phase 2 clinical
trials may be conducted to obtain information prior to beginning larger and more expensive Phase 3 clinical trials.

●
Phase
3. The product candidate is administered to an expanded patient population to further evaluate dosage, to provide statistically significant
evidence of clinical efficacy and to further test for safety, generally at multiple geographically dispersed clinical trial sites.
These clinical trials are intended to establish the overall risk/benefit ratio of the investigational product and to provide an adequate
basis for product approval.

Post-approval
trials, sometimes referred to as Phase 4 studies, may be conducted after initial marketing approval. These trials are used to gain additional
experience from the treatment of patients in the intended therapeutic indication. In certain instances, the FDA may mandate the performance
of Phase 4 clinical trials as a condition of approval of an NDA.

During
the development of a product candidate, sponsors are given opportunities to meet with the FDA at certain points. These points may be
prior to submission of an IND, at the end of Phase 2, and before an NDA or BLA is submitted. Meetings at other times may be requested.
These meetings can provide an opportunity for the sponsor to share information about the data gathered to date, for the FDA to provide
advice, and for the sponsor and the FDA to reach agreement on the next phase of development. Concurrent with clinical trials, companies
usually complete additional animal studies and must also develop additional information about the chemistry and physical characteristics
of the drug and finalize a process for manufacturing the product in commercial quantities in accordance with cGMPs. The manufacturing
process must be capable of consistently producing quality batches of the product candidate and, among other things, the manufacturer
must develop methods for testing the identity, strength, quality and purity of the final drug. In addition, appropriate packaging must
be selected and tested, and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable
deterioration over its shelf life.

NDA
and BLA Review Process

Assuming
successful completion of all required testing in accordance with all applicable regulatory requirements, the results of product development,
nonclinical studies and clinical trials are submitted to the FDA as part of an NDA or BLA requesting approval to market the product for
one or more indications. The NDA or BLA must include all relevant data available from pertinent preclinical studies and clinical trials,
including negative or ambiguous results as well as positive findings, together with detailed information relating to the product’s
chemistry, manufacturing and controls and proposed labeling, among other things. Data can come from company-sponsored clinical studies
intended to test the safety and effectiveness of the product, or from a number of alternative sources, including studies initiated and
sponsored by investigators. The submission of an NDA or BLA requires payment of a substantial application user fee to the FDA, unless
a waiver or exemption applies.

15

In
addition, under the Pediatric Research Equity Act, or PREA, an NDA or BLA or supplement to an NDA or BLA must contain data to assess
the safety and effectiveness of the biological product candidate for the claimed indications in all relevant pediatric subpopulations
and to support dosing and administration for each pediatric subpopulation for which the product is safe and effective. The Food and Drug
Administration Safety and Innovation Act requires that a sponsor who is planning to submit a marketing application for a drug or biological
product that includes a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration submit
an initial pediatric study plan within sixty days after an end-of-Phase 2 meeting or as may be agreed between the sponsor and FDA. Unless
otherwise required by regulation, PREA does not apply to any drug or biological product for an indication for which orphan designation
has been granted.

Within
60 days following submission of the application, the FDA reviews the submitted BLA or NDA to determine if the application is substantially
complete before the agency accepts it for filing. The FDA may refuse to file any NDA or BLA that it deems incomplete or not properly
reviewable at the time of submission and may request additional information. In this event, the NDA or BLA must be resubmitted with the
additional information. Once an NDA or BLA has been accepted for filing, the FDA’s goal is to review standard applications within
ten months after the filing date, or, if the application qualifies for priority review, six months after the FDA accepts the application
for filing. In both standard and priority reviews, the review process may also be extended by FDA requests for additional information
or clarification. The FDA reviews an NDA to determine, among other things, whether a product candidate is safe and effective for its
intended use and whether its manufacturing is sufficient to assure and preserve the product’s identity, strength, quality and purity.
The FDA reviews a BLA to determine, among other things, whether a product candidate is safe, pure and potent and the facility in which
it is manufactured, processed, packed or held meets standards designed to assure the product’s continued safety, purity and potency.
When reviewing an NDA or BLA, the FDA may convene an advisory committee to provide clinical insight on application review questions.
The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.

Before
approving an NDA or BLA, the FDA will typically inspect the facility or facilities where the product is manufactured. The FDA will not
approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements
and adequate to assure consistent production of the product within required specifications. Additionally, before approving an NDA or
BLA, the FDA will typically inspect one or more clinical sites to assure compliance with GCP.

After
the FDA evaluates the NDA or BLA and conducts inspections of manufacturing facilities where the investigational product and/or its drug
substance will be produced, the FDA may issue an approval letter or a Complete Response Letter, or CRL. An approval letter authorizes
commercial marketing of the product with specific prescribing information for specific indications. A CRL indicates that the review cycle
of the application is complete, and the application will not be approved in its present form. A CRL usually describes the specific deficiencies
in the NDA or BLA identified by the FDA and may require additional clinical data, including additional clinical trials, or other significant
and time-consuming requirements related to clinical trials, nonclinical studies or manufacturing. If a CRL is issued, the sponsor must
resubmit the NDA or BLA, addressing all of the deficiencies identified in the letter, or withdraw the application. Even if such data
and information are submitted, the FDA may decide that the NDA or BLA does not satisfy the criteria for approval.

If
regulatory approval of a product is granted, such approval will be granted for particular indications and may entail limitations on the
indicated uses for which such product may be marketed. For example, the FDA may approve the NDA or BLA with a Risk Evaluation and Mitigation
Strategy, or REMS, to ensure the benefits of the product outweigh its risks. A REMS is a safety strategy to manage a known or potential
serious risk associated with a product and to enable patients to have continued access to such medicines by managing their safe use,
and could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods,
patient registries and other risk minimization tools. The FDA also may condition approval on, among other things, changes to proposed
labeling or the development of adequate controls and specifications. The FDA may also require one or more Phase 4 post-market studies
and surveillance to further assess and monitor the product’s safety and effectiveness after commercialization, and may limit further
marketing of the product based on the results of these post-marketing studies.

16

Expedited
Development and Review Programs

The
FDA offers a number of expedited development and review programs for qualifying product candidates. For example, the fast track program
is intended to expedite or facilitate the process for reviewing new products that meet certain criteria. Specifically, product candidates
are eligible for fast track designation if they are intended to treat a serious or life-threatening disease or condition and demonstrate
the potential to address unmet medical needs for the disease or condition. Fast track designation applies to the combination of the product
candidate and the specific indication for which it is being studied. The sponsor of a fast track product candidate has opportunities
for more frequent interactions with the review team during product development and, once an NDA or BLA is submitted, the application
may be eligible for priority review. A fast track product candidate may also be eligible for rolling review, where the FDA may consider
for review sections of the NDA or BLA on a rolling basis before the complete application is submitted, if the sponsor provides a schedule
for the submission of the sections of the NDA or BLA, the FDA agrees to accept sections of the NDA or BLA and determines that the schedule
is acceptable, and the sponsor pays any required user fees upon submission of the first section of the NDA or BLA.

A
product candidate intended to treat a serious or life-threatening disease or condition may also be eligible for breakthrough therapy
designation to expedite its development and review. A product candidate can receive breakthrough therapy designation if preliminary clinical
evidence indicates that the product candidate, alone or in combination with one or more other drugs or biologics, may demonstrate substantial
improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early
in clinical development. The designation includes all of the fast track program features, as well as more intensive FDA interaction and
guidance beginning as early as Phase 1 and an organizational commitment to expedite the development and review of the product candidate,
including involvement of senior managers.

Any
marketing application for a drug or biologic submitted to the FDA for approval, including a product candidate with a fast track designation
and/or breakthrough therapy designation, may be eligible for other types of FDA programs intended to expedite the FDA review and approval
process, such as priority review. A product candidate is eligible for priority review if it has the potential to provide a significant
improvement in the treatment, diagnosis or prevention of a serious disease or condition. For new-molecular-entity NDAs and original BLAs,
priority review designation means the FDA’s goal is to take action on the marketing application within six months of the 60-day
filing date (as compared to ten months under standard review).

Additionally,
depending on the design of the applicable clinical trials, product candidates studied for their safety and effectiveness in treating
serious or life-threatening diseases or conditions may receive accelerated approval upon a determination that the product candidate has
an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured
earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality
or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative
treatments. As a condition of accelerated approval, the FDA will generally require the sponsor to perform adequate and well-controlled
confirmatory clinical studies to verify and describe the anticipated effect on irreversible morbidity or mortality or other clinical
benefit, and may require that such confirmatory studies be underway before granting any accelerated approval. Products receiving accelerated
approval may be subject to expedited withdrawal procedures if the sponsor fails to conduct the required confirmatory studies in a timely
manner or if such studies fail to verify the predicted clinical benefit. In addition, the FDA currently requires as a condition for accelerated
approval pre-approval of promotional materials, which could adversely impact the timing of the commercial launch of the product.

Fast
track designation, breakthrough therapy designation, priority review, and accelerated approval do not change the standards for approval
but may expedite the development or approval process. Even if a product qualifies for one or more of these programs, the FDA may later
decide that the product no longer meets the conditions for qualification or decide that the time period for FDA review or approval will
not be shortened. We may explore some of these opportunities for our product candidates as appropriate.

Orphan
drug designation

Under
the Orphan Drug Act, the FDA may grant orphan designation to a drug or biologic intended to treat a rare disease or condition, which
is a disease or condition that affects fewer than 200,000 individuals in the United States or, if it affects more than 200,000 individuals
in the United States, there is no reasonable expectation that the cost of developing and making a drug product available in the United
States for this type of disease or condition will be recovered from sales of the product. Orphan designation must be requested before
submitting an NDA or BLA. After the FDA grants orphan designation, the identity of the therapeutic agent and its potential orphan use
are disclosed publicly by the FDA. Orphan designation does not convey any advantage in or shorten the duration of the regulatory review
and approval process.

If
a product that has orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such
designation, the product is entitled to orphan product exclusivity, which means that the FDA may not approve any other applications to
market the same drug or biologic for the same disease or condition for seven years, except in limited circumstances, such as a showing
of clinical superiority to the product with orphan exclusivity or inability to manufacture the product in sufficient quantities. The
designation of such drug or biologic also entitles a party to financial incentives such as opportunities for grant funding towards clinical
trial costs, tax advantages and user-fee waivers. However, competitors, may receive approval of different products for the disease or
condition for which the orphan product has exclusivity or obtain approval for the same product but for a different disease or condition
for which the orphan product has exclusivity. Orphan exclusivity also could block the approval of a competing product for seven years
if a competitor obtains approval of the “same drug,” as defined by the FDA, or if the active ingredient of the product candidate
is determined to be contained within the competitor’s product for the same disease or condition. In addition, if an orphan designated
product receives marketing approval for a disease or condition broader than what is designated, it may not be entitled to orphan exclusivity.

17

Post-Approval
Requirements

Any
products manufactured or distributed pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including,
among other things, requirements relating to record-keeping, reporting of adverse experiences, periodic reporting, product sampling and
distribution, and advertising and promotion of the product. After approval, most changes to the approved product, such as adding new
indications or other labeling claims, are subject to prior FDA review and approval. There also are continuing user fee requirements,
under which the FDA assesses an annual program fee for each product identified in an approved NDA or BLA. Drug and biologic manufacturers
and their subcontractors are required to register their establishments with the FDA and certain state agencies, and are subject to periodic
unannounced inspections by the FDA and certain state agencies for compliance with cGMPs, which impose certain procedural and documentation
requirements upon us and our third-party manufacturers. Changes to the manufacturing process are strictly regulated, and, depending on
the significance of the change, may require prior FDA approval before being implemented. FDA regulations also require investigation and
correction of any deviations from cGMPs and impose reporting requirements upon us and any third-party manufacturers that we may decide
to use. Accordingly, manufacturers must continue to expend time, money and effort in the area of production and quality control to maintain
compliance with cGMPs and other aspects of regulatory compliance.

The
FDA may withdraw approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product
reaches the market. Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity
or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved
labeling to add new safety information; imposition of post-market studies or clinical studies to assess new safety risks; or imposition
of distribution restrictions or other restrictions under a REMS program. Other potential consequences include, among other things:

●
restrictions
on the marketing or manufacturing of a product, complete withdrawal of the product from the market or product recalls;

●
fines,
warning letters or holds on post-approval clinical studies;

●
refusal
of the FDA to approve pending applications or supplements to approved applications, or suspension or revocation of existing product
approvals;

●
product
seizure or detention, or refusal of the FDA to permit the import or export of products;

●
consent
decrees, corporate integrity agreements, debarment or exclusion from federal healthcare programs;

●
mandated
modification of promotional materials and labeling and the issuance of corrective information;

●
the
issuance of safety alerts, Dear Healthcare Provider letters, press releases and other communications containing warnings or other
safety information about the product; or

●
injunctions
or the imposition of civil or criminal penalties.

The
FDA closely regulates the marketing, labeling, advertising and promotion of drug products and biologics. A company can make only those
claims relating to safety and efficacy, purity and potency that are approved by the FDA and in accordance with the provisions of the
approved label. The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses. Failure
to comply with these requirements can result in, among other things, adverse publicity, warning letters, corrective advertising and potential
civil and criminal penalties. Physicians may prescribe legally available products for uses that are not described in the product’s
labeling and that differ from those tested by us and approved by the FDA. Such off-label uses are common across medical specialties.
Physicians may believe that such off-label uses are the best treatment for many patients in varied circumstances. The FDA does not regulate
the behavior of physicians in their choice of treatments. The FDA does, however, restrict manufacturer’s communications on the
subject of off-label use of their products.

18

Drug
Product Marketing Exclusivity

Market
exclusivity provisions authorized under the FDCA can delay the submission or the approval of certain marketing applications. For example,
the FDCA provides a five-year period of non-patent data exclusivity within the United States to the first applicant to obtain approval
of an NDA for a new chemical entity. A drug is a new chemical entity if the FDA has not previously approved any other new drug containing
the same active moiety, which is the molecule or ion responsible for the action of the drug substance. During the exclusivity period,
the FDA may not approve or even accept for review an abbreviated new drug application, or ANDA, or an NDA submitted under Section 505(b)(2),
or 505(b)(2) NDA, submitted by another company for another drug based on the same active moiety, regardless of whether the drug is intended
for the same indication as the original innovative drug or for another indication, where the applicant does not own or have a legal right
of reference to all the data required for approval. However, an application may be submitted after four years if it contains a certification
of patent invalidity or non-infringement to one of the patents listed with the FDA by the innovator NDA holder.

The
FDCA alternatively provides three years of non-patent exclusivity for an NDA, or supplement to an existing NDA if new clinical investigations,
other than bioavailability studies, that were conducted or sponsored by the applicant are deemed by the FDA to be essential to the approval
of the application, for example new indications, dosages or strengths of an existing drug. This three-year exclusivity covers only the
modification for which the drug received approval on the basis of the new clinical investigations and does not prohibit the FDA from
approving ANDAs or 505(b)(2) NDAs for drugs containing the active agent for the original indication or condition of use. Five-year and
three-year exclusivity will not delay the submission or approval of a full NDA. However, an applicant submitting a full NDA would be
required to conduct or obtain a right of reference to any preclinical studies and adequate and well-controlled clinical trials necessary
to demonstrate safety and effectiveness.

Pediatric
exclusivity is another type of marketing exclusivity available in the United States. Pediatric exclusivity provides for an additional
six months of marketing exclusivity attached to another period of existing exclusivity, including patent terms, if a sponsor conducts
clinical trials in children in response to a written request from the FDA. The issuance of a written request does not require the sponsor
to undertake the described clinical trials.

Biosimilars
and Reference Product Exclusivity

The
Biologics Price Competition and Innovation Act of 2009, or BPCIA, created an abbreviated approval pathway for biological products that
are highly similar, or “biosimilar,” to or interchangeable with an FDA-approved reference biological product. The FDA has
issued several guidance documents outlining an approach to review and approval of biosimilars. Biosimilarity, which requires that there
be no clinically meaningful differences between the biological product and the reference product in terms of safety, purity, and potency,
is generally shown through analytical studies, animal studies, and a clinical study or studies. Interchangeability requires that a product
is biosimilar to the reference product and the product must demonstrate that it can be expected to produce the same clinical results
as the reference product in any given patient and, for products that are administered multiple times to an individual, the biologic and
the reference biologic may be alternated or switched after one has been previously administered without increasing safety risks or risks
of diminished efficacy relative to exclusive use of the reference biologic. A product shown to be biosimilar or interchangeable with
an FDA-approved reference biological product may rely in part on the FDA’s previous determination of safety and effectiveness for
the reference product for approval, which can potentially reduce the cost and time required to obtain approval to market the product.

Under
the BPCIA, an application for a biosimilar product may not be submitted to the FDA until four years following the date that the reference
product was first licensed by the FDA. In addition, the approval of a biosimilar product may not be made effective by the FDA until 12
years from the date on which the reference product was first licensed. During this 12-year period of exclusivity, another company may
still market a competing version of the reference product if the FDA approves a full BLA for the competing product containing that applicant’s
own preclinical data and data from adequate and well-controlled clinical trials to demonstrate the safety, purity and potency of its
product. The BPCIA also created certain exclusivity periods for biosimilars approved as interchangeable products. At this juncture, it
is unclear whether products deemed “interchangeable” by the FDA will, in fact, be readily substituted by pharmacies, which
are governed by state pharmacy law.

19

A
biological product can also obtain pediatric market exclusivity in the United States. Pediatric exclusivity, if granted, adds six months
to existing exclusivity periods and patent terms. This six-month exclusivity, which runs from the end of existing exclusivity protection
or patent term, may be granted based on the voluntary completion of a pediatric study in accordance with an FDA-issued “Written
Request” for such a study.

Other
Healthcare Laws

Pharmaceutical
companies are subject to additional healthcare regulation and enforcement by the federal government and by authorities in the states
and foreign jurisdictions in which they conduct their business and may constrain the financial arrangements and relationships through
which we research as well as sell, market and distribute any products for which we obtain marketing approval. Such laws include, without
limitation, federal and state anti-kickback, fraud and abuse, false claims, data privacy and security and physician and other healthcare
provider transparency laws and regulations. If our operations are found to be in violation of any of such laws or any other governmental
regulations that apply, they may be subject to penalties, including, without limitation, administrative, civil and criminal penalties,
damages, fines, disgorgement, the curtailment or restructuring of operations, integrity oversight and reporting obligations, exclusion
from participation in federal and state healthcare programs and imprisonment.

Coverage
and Reimbursement

Sales
of any product depend, in part, on the extent to which such product will be covered by third-party payors, such as federal, state, and
foreign government healthcare programs, commercial insurance and managed healthcare organizations, and the level of reimbursement for
such product by third-party payors. Decisions regarding the extent of coverage and amount of reimbursement to be provided are made on
a plan-by-plan basis. The coverage determination process is often a time-consuming and costly process that will require us to provide
scientific and clinical support for the use of our products to each payor separately, with no assurance that coverage and adequate reimbursement
will be obtained. These third-party payors are increasingly reducing reimbursements for medical products, drugs and services. In addition,
the U.S. government, state legislatures and foreign governments have continued implementing cost-containment programs, including price
controls, restrictions on coverage and reimbursement and requirements for substitution of generic products. Adoption of price controls
and cost-containment measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could
further limit sales of any product. Decreases in third-party reimbursement for any product or a decision by a third-party payor not to
cover a product could reduce physician usage and patient demand for the product and also have a material adverse effect on sales.

Healthcare
Reform

In
March 2010, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, each as amended,
collectively known as the ACA, was enacted, which substantially changed the way healthcare is financed by both governmental and private
insurers, and significantly affected the pharmaceutical industry. The ACA contains a number of provisions, including those governing
enrollment in federal healthcare programs, reimbursement adjustments and changes to fraud and abuse laws. By way of example, the ACA:

●
increased
the minimum level of Medicaid rebates payable by manufacturers of brand name drugs from 15.1% to 23.1% of the average manufacturer
price;

●
required
collection of rebates for drugs paid by Medicaid managed care organizations;

●
required
manufacturers to participate in a coverage gap discount program, under which they must agree to offer 70 percent point-of-sale discounts
off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the
manufacturers’ outpatient drugs to be covered under Medicare Part D; and

●
imposed
a non-deductible annual fee on pharmaceutical manufacturers or importers who sell “branded prescription drugs” to specified
federal government programs.

20

Other
legislative changes have been proposed and adopted in the United States since the ACA was enacted. On March 11, 2021, the American Rescue
Plan Act of 2021 was signed into law, which eliminated the statutory Medicaid drug rebate cap, beginning January 1, 2024. The rebate
was previously capped at 100% of a drug’s average manufacturer price, or AMP. Most recently, on August 16, 2022, the Inflation
Reduction Act of 2022, or IRA, was signed into law. Among other things, the IRA requires manufacturers of certain drugs to engage in
price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap; imposes rebates under Medicare
Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); and replaces the Part D coverage gap
discount program with a new discounting program (beginning in 2025). The IRA permits the Secretary of the Department of Health and Human
Services (HHS) to implement many of these provisions through guidance, as opposed to regulation, for the initial years. On August 29,
2023, HHS announced the list of the first ten drugs that will be subject to price negotiations, although the drug price negotiation programs
is currently subject to legal challenges. For that and other reasons, it is currently unclear how the IRA will be effectuated.

Moreover,
there has recently been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products,
which has resulted in several Congressional inquiries, proposed and enacted legislation and executive orders issued by the President
designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer
patient programs, and reform government program reimbursement methodologies for drug products. Individual states in the United States
have also become increasingly active in implementing regulations designed to control pharmaceutical product pricing, including price
or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency
measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

Data
Privacy and Security Laws

Numerous
state, federal and foreign laws, regulations and standards govern the collection, use, access to, confidentiality and security of health-related
and other personal information, and could apply now or in the future to our operations or the operations of our partners. In the United
States, numerous federal and state laws and regulations, including data breach notification laws, health information privacy and security
laws and consumer protection laws and regulations govern the collection, use, disclosure, and protection of health-related and other
personal information. In addition, certain foreign laws govern the privacy and security of personal data, including health-related data.
Privacy and security laws, regulations, and other obligations are constantly evolving, may conflict with each other to complicate compliance
efforts, and can result in investigations, proceedings, or actions that lead to significant civil and/or criminal penalties and restrictions
on data processing.

Competition

The
pharmaceutical and biotechnology industries are characterized by rapidly advancing technologies, intense competition, government regulation
and a strong emphasis on proprietary products. While we believe that our technology, knowledge and scientific resources provide us with
certain competitive advantages, we face competition from many sources, including foreign and domestic pharmaceutical and biotechnology
companies, academic institutions, governmental agencies and public and private research institutions. Many of these competitors may have
access to greater capital and resources than us. These competitors also compete with us in recruiting and retaining qualified scientific
and management personnel. Any product candidates that we successfully develop and commercialize will compete with new immunotherapies
that may become available in the future. Our competitors include larger and better funded biopharmaceutical, biotechnology and therapeutics
companies, specifically companies focused on cancer immunotherapies, such as Amgen, Inc., AstraZeneca plc, BMS, Genentech, Inc., GlaxoSmithKline
PLC, Merck & Co. Inc., Novartis AG, Pfizer Inc., Roche Holding Ltd and Sanofi S.A. On the other hand, many of these companies are
developing immunotherapeutics which may have potential to be used in concert with Decoy20 and in this regard, we view them as potentially
complimentary.

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With
respect to our lead candidate, Decoy20, there are a number of companies that are developing possible treatments for cancer, however,
we believe we are the only company using systemic administration of killed, non-pathogenic Gram-negative bacteria with reduced lipopolysaccharide-endotoxin
to stimulate innate and adaptive immune system pathways.

Our
success will be based in part upon our ability to successfully commercialize Decoy20 and to identify, develop and manage a portfolio
of therapeutics that are safer and more effective than competing products in our target indications. Our market opportunity has the potential
to be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer side effects,
are more convenient or are less expensive than any therapeutics we may develop. Our competitive position will also be dependent upon
our ability to attract and retain qualified personnel, to obtain patent protection or otherwise develop proprietary products or processes,
and protect our intellectual property, to differentiate our product from other therapeutics and to secure sufficient capital resources
for the period between technological conception and commercial sales. The availability of reimbursement from government and other third-party
payors will also significantly affect the pricing and competitiveness of our products. Our competitors may also obtain FDA or other regulatory
approval for their products more rapidly or with broader applications than we may obtain approval for ours, which could result in our
competitors establishing a strong market position before we are able to enter the market.

Intellectual
Property

Our
success depends, at least in part, on our ability to protect our proprietary technology and intellectual property, and to operate without
infringing or violating the proprietary rights of others. We rely on a combination of patent, trademark, trade secret and copyright laws,
know-how, intellectual property licenses and other contractual rights (including confidentiality and invention assignment agreements)
to protect our proprietary technology and intellectual property, including related intellectual property rights.

Patents

As
of March 16, 2026, we own 61 granted patents and 17 pending patent applications to use within our field of business. Our patents
and patent applications generally relate to compositions and methods for treating cancer and infectious diseases, and our patents
and any patents that issue from our pending patent applications are expected to expire at various dates between 2033 and
2043.

Our
ability to maintain and consolidate our proprietary position for our technology will depend on our success in obtaining effective claims
and enforcing those claims once granted. We do not know whether any of our patent applications or any patent applications that we may
license will result in the issuance of any patents. Our issued patents and those that may be issued in the future, or patents that we
may exclusively license, may be challenged, narrowed, circumvented or found to be invalid or unenforceable, which could limit our ability
to stop competitors from marketing related products or the length of term of patent protection that we may have for our products. We
cannot be certain that we were the first to invent the inventions claimed in our owned patents or patent applications. In addition, our
competitors may independently develop similar technologies or duplicate any technology developed by us, and the rights granted under
any issued patents may not provide us with any meaningful competitive advantages against these competitors. Furthermore, because of the
extensive time required for development, testing and regulatory review of a potential product, it is possible that, before any of our
products can be commercialized, any related patent may expire or remain in force for only a short period following commercialization,
thereby reducing any advantage of the patent.

Trade
Secrets and Confidential Information

In
addition to patents, we rely on trade secrets and know-how to develop and maintain our competitive position. Trade secrets and know-how
can be difficult to protect. We rely on, among other things, confidentiality and invention assignment agreements to protect our proprietary
know-how and other intellectual property that may not be patentable, or that we believe is best protected by means that do not require
public disclosure. For example, we require our employees to execute confidentiality agreements in connection with their employment relationships
with us, and to disclose and assign to us inventions conceived in connection with their services to us. However, there can be no assurance
that these agreements will be enforceable or that they will provide us with adequate protection. We also seek to preserve the integrity
and confidentiality of our data, trade secrets and know-how by maintaining physical security of our premises and physical and electronic
security of our information technology systems.

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We
may be unable to obtain, maintain and protect the intellectual property rights necessary to conduct our business, and may be subject
to claims that we infringe or otherwise violate the intellectual property rights of others, which could materially harm our business.
For a more comprehensive summary of the risks related to our intellectual property, see