NASDAQ: LPCN

In
September 2024, we entered into a distribution and license agreement (the “SPC License Agreement”) for the development and
commercialization of TLANDO, an oral TRT with SPC Korea Limited (“SPC”), pursuant to which the Company granted to SPC a non-transferable,
exclusive, royalty-bearing license to commercialize our TLANDO product for TRT in South Korea (the “SPC Territory”). In October
2024, we entered into a distribution and supply agreement (the “Pharmalink Distribution Agreement”) with Pharmalink granting
a non-transferable, exclusive, license to commercialize our TLANDO product in the field specific to the Gulf Cooperation Council (“GCC”)
countries, including Saudi Arabia, Kuwait, the United Arab Emirates, Qatar, Bahrain, and Oman (the “Pharmalink Territory”).
In April 2025, we entered into a License and Supply Agreement (the “Aché License Agreement”) with Aché, pursuant
to which we granted to Aché an exclusive license to commercialize TLANDO with respect to the field, specific to Brazil (the “Aché
Territory”). Under the agreement, we are entitled to receive fees upon the achievement of certain regulatory milestones, royalties
on net sales and will supply TLANDO to Aché at an agreed transfer price. We retain development and commercialization rights for
TLANDO outside of the United States, Canada, South Korea, the GCC and Brazil.

Additional
clinical development pipeline candidates include: LPCN 1154 for postpartum depression (“PPD”); LPCN 2201 for major depressive
disorder (“MDD”); LPCN 2203 for essential tremor; LPCN 2101 for epilepsy; and LPCN 2401 for improved body composition in
obesity management. In addition to our clinical development product candidates, we have assets for which we expect to seek partnerships
to enable further development including TLANDO for territories outside of the United States, South Korea, the GCC, and Brazil, LPCN 1148
comprising a novel prodrug of testosterone and testosterone laurate (“testosterone laurate” or “TL”), for the
management of decompensated cirrhosis, and LPCN 1107, potentially the first oral hydroxy progesterone caproate (“HPC”) product
indicated for the prevention of recurrent PTB, which has completed a dose finding clinical study in pregnant women and has been granted
orphan drug designation by the FDA.

The
following chart summarizes the status of our product candidate development programs:

Corporate
Strategy

Our
goal is to become a leading biopharmaceutical company focused on leveraging our proprietary drug delivery technology platform to develop
differentiated products through oral delivery of previously difficult to deliver molecules. The key components of our strategy are to:

Advance
LPCN 1154 and other CNS product candidates. We intend to focus on the development of endogenous neuroactive steroids (“NASs”)
which have broad applicability in treating various CNS conditions where we can leverage our technology platform to develop highly differentiated
oral therapeutics. Our priority is the development of LPCN 1154, a fast-acting oral antidepressant for PPD with potential for outpatient
use.

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Support
our Licensees, Verity, SPC, Pharmalink, and Aché in commercialization of our licensed oral TRT product. We believe the TRT
market needs a differentiated, convenient oral option. We have exclusively licensed rights to TLANDO to Verity for commercialization
of TLANDO in the Licensed Verity Territory, to SPC for commercialization in the SPC Territory, to Pharmalink in the Pharmalink Territory,
and to Aché in the Aché Territory (together, the “Currently Licensed TLANDO Territories”). We plan to support
Verity’s, SPC’s, Pharmalink’s, and Aché’s efforts to effectively enable the availability of TLANDO to
patients in a timely manner, in addition to receiving milestone payments, royalty payments, and/or payments for product sales associated
with TLANDO commercialization as agreed to in the Verity License Agreement, the SPC License Agreement, the Pharmalink Distribution Agreement
and the Aché License Agreement.

Develop
partnership(s) to continue the advancement of pipeline assets. We continuously strive to prioritize our resources in seeking partnerships
of our pipeline assets. We are currently exploring partnerships for our liver program LPCN 1148 for the management of decompensated cirrhosis
including prevention of the recurrence of overt hepatic encephalopathy (“overt hepatic encephalopathy” or “OHE”);
LPCN 2401 for improved body composition as adjunct therapy to incretin mimetics use in obesity management; and LPCN 1107, our candidate
for prevention of pre-term birth. We are also exploring the possibility of licensing LPCN 1021 (known as TLANDO in the United States)
to third parties outside of the Currently Licensed TLANDO Territories, although no additional licensing agreements have been entered
into by the Company in any other territories.

Our
Pipeline Product Candidates

Our
pipeline of clinical development candidates includes LPCN 1154 for PPD, LPCN 2201 for MDD, LPCN 2101 for epilepsy, and LPCN 2203 for
essential tremor. We will continue to explore other product development candidates targeting CNS indications with a significant unmet
need. We will also continue efforts to enter into partnership arrangements for the continued development and/or marketing of LPCN 1144,
LPCN 1148, LPCN 2401, LPCN 1107 as well as for the TRT Assets outside of the Currently Licensed TLANDO Territories.

Our
products are based on our proprietary drug delivery technology platform. TLANDO was approved by the FDA in March 2022. Our patented
technology is based on lipidic compositions which form an optimal dispersed phase in the gastrointestinal environment for improved absorption
of insoluble drugs. The drug loaded dispersed phase presents the solubilized drug efficiently at the absorption site (gastrointestinal
tract membrane) thus improving the absorption process and making the drug less dependent on physiological variables such as dilution,
gastrointestinal pH and food effects for absorption. Our formulation enables improved solubilization and higher drug-loading capacity,
which can lead to improved bioavailability, reduced dose, faster and more consistent absorption, reduced variability, reduced sensitivity
to food effects, improved patient compliance, and targeted lymphatic delivery where appropriate.

TRT
Franchise – TLANDO and LPCN 1111 (TLANDO XR)

TLANDO:
An Oral Product for Testosterone Replacement Therapy

As
previously described, under the Verity License Agreement, in January 2024, we granted to Verity an exclusive, royalty-bearing, sublicensable
right and license to develop and commercialize TLANDO, our product for TRT, in the U.S. and Canada effective February 1, 2024. TLANDO
received FDA approval on March 28, 2022. Any FDA requirement to conduct certain post-marketing studies will be the responsibility of
Verity. In addition, in September 2024, we granted SPC an exclusive, royalty-bearing license to commercialize TLANDO in South Korea,
in October 2024 we granted Pharmalink an exclusive license to commercialize TLANDO in the GCC countries and in April 2025, we granted
Aché an exclusive license to commercialize and supply TLANDO in Brazil.

Proof-of-concept
for TLANDO was initially established in 2006, and TLANDO was subsequently licensed in 2009 to Solvay Pharmaceuticals, Inc., which was
then acquired by Abbott Products, Inc. (“Abbott”). Following a portfolio review associated with the spin-off of AbbVie Inc.
by Abbott in 2011, we re-acquired the rights to TLANDO. All obligations under the prior license agreement have been completed except
that Lipocine will owe Abbott a perpetual 1% royalty on net sales of TLANDO. Such royalties were limited to $1 million in the first two
calendar years following product launch, after which period there is no cap on royalties and no maximum aggregate amount. If generic
versions of any such product are introduced, then royalties will be reduced by 50%. TLANDO was commercially launched on June 7, 2022.
During the years ended December 31, 2025 and 2024, we incurred royalty expense of approximately $40,000 and $24,000, respectively.

Since
TLANDO received full FDA approval, under the terms of the Verity License Agreement, Verity will need to assess the safety and effectiveness
of TLANDO in pediatric patients, as required by the Pediatric Research Equity Act. The FDA may also require certain post-marketing studies
to be conducted which will also be the responsibility of Verity. Similarly, SPC, Pharmalink, and Aché are responsible for obtaining
any regulatory/marketing approvals for TLANDO required for the SPC Territory, the Pharmalink Territory, and the Aché Territory
respectively.

Upon
execution of the Verity License Agreement, Verity paid us an initial payment of $2.5 million which was received on signing of the License
Agreement and $5 million which was received on February 1, 2024. Verity also made an additional payment of $2.5 million to us on December
30, 2024, and made the final license payment of $1 million to us on January 5, 2026. We are also eligible to receive milestone payments
of up to $259 million in the aggregate, depending on the achievement of certain sales milestones in a single calendar year and/or development
milestones with respect to products licensed by Verity under the Verity License Agreement. In addition, we will receive tiered royalty
payments at rates ranging from 12% up to 18% of net sales of all products licensed under the Verity License Agreement in the Licensed
Verity Territory.

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SPC
paid us a non-refundable, non-creditable upfront fee in October 2024. We also received an additional payment for a non-refundable, non-creditable
prepayment in consideration for TLANDO product inventory, and we are eligible to receive additional payments for various marketing authorization
and sales milestones, and the Company will supply TLANDO to SPC and receive a supply price. In addition, we will receive royalties on
net sales in South Korea under the SPC License Agreement.

Upon
execution of the Pharmalink Distribution Agreement, Pharmalink paid a non-refundable, non-creditable upfront fee. Under the Pharmalink
Distribution Agreement, we could receive additional payments in regulatory authorization milestones and we will supply TLANDO to Pharmalink
at an agreed transfer price.

Upon
execution of the Aché License Agreement, Aché paid us a non-refundable, non-creditable upfront fee in May 2025. Under the
Aché License Agreement, we may receive additional payments in regulatory authorization milestones, royalties on net sales and
will supply TLANDO to Aché at an agreed transfer price.

We
are exploring the possibility of licensing LPCN 1021 (known as TLANDO in the United States) to third parties outside the Currently Licensed
TLANDO Territories, although no licensing agreement has been entered into by the Company in any other territories. If and when an agreement
is made with a partner, such an arrangement would likely be partially contingent upon obtaining local regulatory approval. No assurance
can be given that any license agreement will be completed or, if an agreement is completed, that such an agreement would be on terms
favorable to us.

Oral
Programs for CNS Disorders

Some
preferred endogenous or naturally occurring NAS present in the central nervous system act as positive allosteric modulators (“PAMs”)
of the GABAA receptor, the major biological target of the inhibitory neurotransmitter γ-aminobutyric acid (“GABAA”).

In
October 2024, we announced positive data from our qEEG study of our oral brexanolone with results indicating robust central nervous system
activity of oral brexanolone, with concentration- and time-dependent post-dose changes in qEEG as follows:

●
Quantitative Electroencephalogram (“qEEG”) in healthy subjects administered single doses of oral brexanolone, a neuroactive
steroid, confirmed GABAA modulation

●
Rapid and durable CNS target engagement confirms effective oral delivery of bioidentical brexanolone

●
Promising results support continued development of oral brexanolone for the treatment of neuropsychiatric disorders

We
believe through utilization of our proprietary technology we may have the ability to enable effective oral delivery of endogenous GABAA
receptor PAMs which historically had been deemed to be not orally bioavailable. As a novel drug class, NASs have received considerable
attention because of their potential to treat various neuropsychiatric conditions including depression, movement disorders, epilepsy,
anxiety, and neurodegenerative diseases. We have conducted Phase 1 pharmacokinetic (“PK”) studies for each of our three lead
NAS candidates which have demonstrated promising PK results, safety, and tolerability and we are evaluating additional undisclosed CNS-focused
candidates.

LPCN
1154: Product Candidate for PPD

Our
most advanced NAS candidate is LPCN 1154, a rapid onset, oral formulation of the neuroactive steroid brexanolone which we are developing
for the treatment of PPD. We have completed clinical oral PK studies including a pilot food effect study and a pilot PK bridge study.
In addition, as a prelude to a LPCN 1154 pivotal study, a multi-dose study was done confirming the dosing regimen for the PK bridge study
using the scaled up “to be marketed” formulation required for New Drug Application (“NDA”) filing. In June 2024,
we announced results from a dosing regimen confirmation study which demonstrated LPCN 1154 meets bioequivalence with comparator, IV brexanolone,
meeting standard bioequivalence criteria and Ctrough criteria. LPCN 1154 treatment was well-tolerated with no sedation nor
somnolence events observed in the dosing regimen confirmation study.

After
completing PK studies and labeling studies such as a food effect study and PK profiling in women with PPD, we met with the FDA in the
first quarter of 2025. In the meeting, we were advised that the FDA believes, in addition to the previously completed PK dosing regimen
confirmation data, an efficacy and safety study of oral LPCN 1154 in the target population will be required for 505(b)(2) NDA submission.
Based on observed comparable exposure of LPCN 1154 and IV brexanolone in the dosing confirmation study, we have confirmed the target
dosing regimen and initiated a Phase 3 safety and efficacy study and, as of February 18, 2026, we had completed enrollment, dosing
and the last patient’s last visit in the Phase 3 pivotal trial. We expect to report data from this Phase 3 trial in April 2026, and data from this trial are expected to support
a 505(b)(2) NDA submission for LPCN 1154 in 2026.

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We
are exploring the possibility of partnering with a third party for the marketing and commercialization of LPCN 1154, although no partnering
agreement has been entered into by the Company. No assurance can be given that any partnering agreement will be completed, or, if an
agreement is completed, that such an agreement would be on terms favorable to us.

PPD

PPD,
a type of major depressive disorder with onset either during pregnancy or within four weeks of delivery, refers to depression persisting
up to 12 months after childbirth. PPD can be clinically segmented by the severity of symptoms and presence of a comorbidity, including
epilepsy. PPD is a life-threatening condition with few existing treatment options. Maternal depression and suicide can have far-reaching
consequences for child development, family functioning, and the nation’s economy. Approximately 600,000 women are affected by PPD
annually with approximately 240,000 women diagnosed with PPD, and approximately 144,000 of those diagnosed patients treated with prescription
medication. We believe that PPD is a significant and growing market opportunity, and increased awareness of PPD and effective therapies
is expected to increase diagnosis for symptomatic women with PPD.

Disease
Overview - PPD

● PPD
is distinct from the “baby blues,” a condition that up to 70% of all new mother’s
experience; “baby blues” tend to be short-lived emotional conditions that do
not interfere with daily activities.

● Symptoms
of PPD include hallmarks of major depression, including, but not limited to, sadness, depressed
mood, loss of interest, change in appetite, insomnia, sleeping too much, fatigue, difficulty
thinking/concentrating, excessive crying, fear of harming the baby/oneself, and/or thoughts
of death or suicide.

● During
pregnancy, levels of endogenous NASs increase considerably along with levels of progesterone;
however, they drop sharply postpartum. It has been hypothesized that the rapid perinatal
decrease in circulating levels of endogenous NASs may be involved in the development of PPD.
The first approved treatment option for PPD was an injectable containing endogenous NASs.

● Depression
may persist long after child delivery. Additionally, approximately 40% of women relapse in
subsequent pregnancies or on other occasions.

● Psychiatric
comorbidities are common in patients with epilepsy. Patients with epilepsy are at high risk
for major depressive disorders and PPD. Reported PPD rates are higher among women with epilepsy
than the general population.

Associated
Risk Factors

● Genetic:
family history and/or previous experience of depression or other mood disorders.

● Physiological:
rapid changes in sex hormones, stress hormones, and thyroid hormone levels during and after
delivery.

● Environmental:
stressful life events, changes in relationships at home and at work, and/or lack of familial
support.

Unmet
Medical Need

We
believe there is considerable unmet need within women with PPD due to lack of convenient and fast-acting oral therapies with good tolerability,
especially with respect to CNS depressant effects. Selective Serotonin Reuptake Inhibitors (“SSRIs”) have been the traditional
first-line choice for women with severe PPD and require weeks for onset of efficacy; therefore, a need for an oral treatment option with
a faster onset of action, short treatment duration, and improved tolerability remains a significant unmet need in treating PPD, especially
in mothers with moderate to severe depression prone to harmful actions.

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Injectable
brexanolone (Zulresso™, SAGE Therapeutics (“Sage”)) became the first FDA-approved treatment for postpartum depression.
However, numerous factors limited the utilization of injectable brexanolone such as method of administration, cost, and safety concerns,
and SAGE Therapeutics discontinued Zulresso in October 2024. In addition to Zulresso, SAGE received FDA approval for zuranolone (brand
name ZURZUVAE™) in August 2023 and ZURZUVAE was launched commercially in December 2023. Zuranolone, a synthetic neuroactive steroid
derivative, is an oral, once daily 14-day treatment for postpartum depression and is the first oral medication approved by the FDA for
the treatment of postpartum depression. Per label, besides long terminal half-life of approximately 19.7 to 24.6 hours and dosage modifications
needed for concomitant use with CYP3A4 modulators, warnings and precautions include CNS depressant effects, impaired ability to drive
or engage in other potentially hazardous activities and embryo-fetal toxicity. In June 2025, Sage announced the acquisition of Sage by
Supernus Pharmaceuticals (“Supernus”) and Supernus’ intention to strengthen their leading presence in neuropsychiatric
conditions with Sage’s innovative commercial product, ZURZUVAE. The transaction closed in the third quarter of 2025.

We
believe LPCN 1154 targets the unmet need for robust, rapid relief of PPD symptoms with a 48-hour dosing duration through a convenient
oral therapy candidate comprising bioidentical NASs with improved tolerability. If approved, we believe that LPCN 1154 has the potential
to be a first-line therapy option in treating PPD, providing the following advantages over current treatment options:

○ Rapid
relief: faster management of depression, reduced risk of suicidal thoughts and behaviors,
fewer hospitalizations, positive outcomes in terms of mother and family relationships, and
reduced financial burden.

○ Short
treatment duration: better compliance, scheduling flexibility (e.g. weekend) with minimal
family disruption, more amenable to discreet treatment, and a quick return to normal daily
activities, including breast feeding and driving.

○ Improved
tolerability: fewer CNS depressant effects, better adherence to dosing regimen, more
quality time for baby care, and less dependence on caregiver support.

LPCN
2201: NAS for Major Depressive Disorders (“MDD”)

We
are currently advancing LPCN 2201, a unique oral brexanolone formulation, as a novel, rapid relief oral treatment option for MDD
with the goal of improving outcomes without the limitations of existing therapies. LPCN 2201 is chemically identical to the
endogenous human hormone allopregnanolone, a positive allosteric modulator of y-aminobutyric acid (GABAA) receptor. Post
planned clinical assessment of unique formulations, we plan to submit a protocol for a Phase 2 study to the FDA, and we may initiate
a study to evaluate LPCN 2201 for MDD, subject to resource prioritization.

Disease
Overview - MDD

MDD
affects approximately 21 million adults in the U.S., representing 8.4% of the population. While 12.8 million individuals receive
treatment, nearly 3.8 million patients continue to struggle with treatment-resistant depression (“TRD”), a condition
where symptoms persist despite multiple antidepressant therapies. These patients experience persistent, debilitating symptoms,
reduced quality of life, higher comorbidities, and significant social and occupational impairment. In 2018, the total annual burden
of medication-treated MDD in the U.S. was approximately $92.7 billion, with $43.8 billion (47%) attributable to TRD.

Unmet
Medical Need

Current
treatment options for MDD pose significant challenges. Most available antidepressants such as SSRIs and SNRIs require 4-6 weeks to show
meaningful effects and often fail to deliver adequate relief. Additionally, SSRIs and SNRIs can lead to metabolic issues, sexual dysfunction,
and heightened risk of cerebrovascular events in vulnerable populations. Even newer therapies that can be used for fast depression symptom
relief like Spravato® (esketamine) come with serious safety concerns, including black box warnings for sedation, dissociation,
cognitive impairment, and increased blood pressure. Beyond safety, access remains a major hurdle – esketamine, for example requires
intranasal administration in a clinical setting under a restricted program, limiting convenience and scalability.

Patients
and providers urgently need a convenient, well-tolerated, at-home rapid relief option for MDD. Ideal solutions should offer ease of use
without monitoring requirements, enabling treatment in outpatient or home settings. Improved treatments should deliver effective antidepressant
action with high and sustained remission rates, while maintaining a wide therapeutic index for safety and tolerability. Improved compliance,
better management of comorbid conditions such as anxiety, and enhanced patient experience are critical to addressing the gaps left by
current therapies.

We
believe LPCN 2201 has the potential to be a convenient, fastest time to action treatment through its fast-acting mechanism promoting
acute stabilization of symptoms with the freedom of at home dosing while presenting no significant risk of adverse reactions from exposure
to bioidentical brexanolone. LPCN 2201 could be an appealing option for patients for whom rapid improvement is a priority for the treatment
of moderate or severe MDD with suicidal ideation.

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LPCN
2101: NAS for Epilepsy

We
are currently developing an additional NAS candidate, LPCN 2101, for epilepsy including Drug Resistant Epilepsy (“DRE”)
and women with epilepsy. We have completed pre-clinical and Phase 1 studies for LPCN 2101 which demonstrated promising PK results,
safety and tolerability. In July 2022 our IND was accepted by the FDA for LPCN 2101 for adults with epilepsy and we may initiate a
Phase 2 proof-of-concept study to evaluate the safety, tolerability, and efficacy of LPCN 2101, subject to resource
prioritization.

Disease
Overview – Epilepsy

Epilepsy
is one of the most common neurological disorders characterized by recurrent, unprovoked seizures caused by abnormal electrical activity
in the brain. Epilepsy is defined by the 1) occurrence of at least two unprovoked seizures more than 24 hours apart, 2) occurrence of
one unprovoked seizure and a probability of further seizures occurring over the next 10 years, and/or 3) diagnosis of an epilepsy syndrome.
Patients with epilepsy have increased risk of mortality due to direct effects of seizures (e.g., status epilepticus, car accidents) and
indirect effects of seizures (e.g., suicide, cardiovascular effects).

Epilepsy
is a disorder of the brain that causes seizures, affecting the physical, mental, and social well-being of persons, and is associated
with a 2 to 3 times greater mortality rate compared with the general population. About 60-65% of epilepsy is idiopathic and about 30%
of patients are refractory or have DRE (i.e., epilepsy not well managed with currently available Anti-Seizure Medications (“ASMs”)).

DRE:
There are about 2.9 million adults and 456,000 children with active epilepsy, meaning they are either taking medication or have had a
seizure in the past year, with approximately 150,000 new diagnoses annually. Approximately 38% of adults with epilepsy report having
a disability and the unemployment rate among adults with epilepsy is approximately 29%. DRE is a significant clinical challenge in epilepsy
care, with high social and occupational limitations. DRE affects 30-40% of epilepsy patients in the U.S. and DRE contributes heavily
to the $24.5 billion annual epilepsy-related healthcare costs and DRE poses significant treatment challenges due to limited success with
medications, and need for early identification.

Unmet
needs in DRE: Many patients with DRE cycle through multiple ASMs with limited success. Seizures may cause physical injuries,
and a minority may last long (status epilepticus) or recur in clusters and can be life-threatening. Rescue treatments (primarily benzodiazepines)
do not prevent future seizures, they only stop the current episode. DRE patients are at high risk of seizure recurrence within hours
or days after a cluster. There is a lack of post-rescue medications, especially for patients who experience recurrent seizure clusters
or drug-resistant epilepsy and a need to transition effectively to maintenance therapy and sustain seizure control after acute treatment
prevents status epilepticus and to prevent patients from requiring emergency room treatment for seizure management. There remains an
unmet need for medications with novel mechanism of action and minimal cognitive, mood, or systemic side effects, especially for patients
who experience recurrent seizure clusters or DRE.

WWE:
It is estimated that approximately 1,000,000 childbearing (“CB”) aged women suffer from active epilepsy in the U.S. Women
of CB age with epilepsy face many additional challenges due to hormonal influences on seizure activity and endocrine function throughout
the different phases of their reproductive cycles. Elevated estrogen or decreased progesterone levels can exacerbate seizure frequency.
Often, these women experience hormonal and endogenous NAS imbalances, coupled with fluctuations in the blood levels of ASMs that impact
control of seizures, efficacy of oral contraceptives, any coexisting anxiety and/or depression and any associated sleep impairment. Epileptic
patients are 5-20 times more likely to develop depression.

Women
with epilepsy were once counseled to avoid pregnancy, but epilepsy is no longer considered a contraindication to pregnancy. Caregivers
for WWE in the preconception phase either intending to start a family (planning pregnancy) or using contraception to prevent an unplanned
pregnancy face significant challenges to balance seizure control efficacy with the selection and dosage of ASMs and ASM-related risks
such as, among other risks, fetal-neonatal toxicity, contraception failure, and psychiatric side effects.

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Several
ASMs are known to have teratogenic effects on the developing fetus (converging evidence from registry studies indicates that teratogenic
risks are highest with valproate, followed by carbamazepine and topiramate). Other commonly prescribed ASMs, including older generation
agents, such as phenobarbital and phenytoin, have been associated with higher risks as compared with lamotrigine, levetiracetam, clonazepam
and gabapentin (Vajda et al., 2014; Voinescu and Pennell, 2015). Moreover, risks associated with ASMs are considerable early in pregnancy;
therefore, it is necessary that WWE of CB age undergo counseling, monitoring, and adjustment to the most appropriate ASM prior to becoming
pregnant. It is preferable that WWE of CB age discuss seizure control with their doctor for at least 6 months before conception and,
if possible, cease ASM therapy or use the lowest effective dose of a single anticonvulsant according to the type of epilepsy and the
fetal toxicity of the ASM. Anxiety, depression, lack of adherence to ASM, and/or contraception failure may be experienced by women who
are worried about unplanned pregnancy or are late in confirming pregnancy, planned or unplanned. ASMs can reduce the efficacy of oral
contraceptives, compounding this problem.

Complex,
multidirectional interactions between female hormones, seizures, and ASMs exist. Most hormones act as NASs and can thus modulate brain
excitability. Any changes in endogenous or exogenous hormone levels can affect the occurrence of seizures, either directly or via PK
interactions that modify the plasma levels of ASMs (Harden, 2008). The PK interactions between oral contraceptives and ASMs are bidirectional
(Johnston and Crawford, 2014). The efficacy of hormonal contraception may be diminished for women taking CYP-P450 enzyme inducing ASMs.
Epilepsy is not a medical condition in which contraceptives are contraindicated. Contraceptive failure, possibly related to ASMs, may
be responsible for up to 1 in 4 unplanned pregnancies in WWE (~12.5% of all WWE pregnancies), versus a rate of 1% in healthy women.

Unmet
need to treat WWE in CB age

Approximately
30% of patients with epilepsy cannot efficiently control their condition with available ASMs, making consideration of newer pharmacological
treatment development options important, and managing uncontrolled seizures in WWE of CB age is the primary aim during preconception,
pregnancy, and postpartum phases. Therefore, uncompromised ASM efficacy with acceptable variability and less or no drug-drug interactions
achieved with lowest possible monotherapy dose to address fetal toxicity concerns remain highly unmet needs. Moreover, control of seizures
including prevention of breakthrough seizures is critical when planning for pregnancy and also during pregnancy, as it can also lead
to undesired falls or auto-accidents and compromise freedom to drive.

Select
ASMs have the potential to induce contraception failures, reproductive hormone imbalance, anxiety, and depression. There remains an unmet
need for an ASM without the aforementioned downsides, with no to low fetal-neonatal toxicity and without breast-feeding concerns, as
well as the potential to treat associated comorbidities.

While
over 30 molecules have been approved for the treatment of epilepsy in the U.S., no epilepsy drug has been specifically approved for WWE
of CB age. We believe our endogenous NASs as GABAA PAMs, while targeting the goal of seizure control, also have the potential
for additional benefits in psychiatric disorders comorbidities (e.g., anxiety and/or depression) and sleep impairment. Moreover, these
oral endogenous NASs could potentially address some of the fetal toxicity concerns related to unplanned or planned pregnancy in WWE.
(1)

(1) Ref:
S.Bangar et al. Functional Neurology 2016; 31(3): 127-134; Reimers et al. Seizure. 2015 May;
28: 66-70.

LPCN
2203: Oral Product for Management of Essential Tremor

LPCN
2203 is an oral candidate for management of essential tremor (“ET”) comprising a bioidentical GABAA modulating
NAS. We have successfully completed oral pharmacokinetics with bioidentical GABAA modulating NAS and are planning to submit
a protocol for a proof-of-concept phase 2 study for ET to the FDA.

Disease
Overview - Essential Tremor

Essential
Tremor is one of the most common movement disorders in the United States, affecting an estimated 7 million in the U.S. For ET patients,
uncontrollable shaking of the hands, head, voice, or legs creates difficulty eating, dressing, writing, and pursuing other day-to-day
tasks. The etiology of ET is largely unknown, but reduced GABAA receptor levels and decreased GABAergic activity have been
observed in ET.

While
ET is often associated with aging populations, ET can begin much earlier in life, with a progressive disease course that can eventually
necessitate a care partner. Social anxiety and depressive symptoms can manifest in patients with ET as tremor severity increases and
may negatively impact a patient’s ability to work and engage in hobbies. In an interview study of ET patients and care partners,
the most common impacts on activities of daily living are pouring liquids and writing/typing (100%) and grooming/hygiene, drinking, dressing,
eating, and reading (80-85%). Overall, 90% of participants noted the emotional impact of ET, with 75% reporting tremor-related worry
or anxiety.

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The
only FDA approved pharmacological treatment for ET was approved more than 50 years ago, and the majority of patients with ET experience
a sub-optimal response with standard-of-care treatments, highlighting numerous and compelling unmet needs in care such as daytime efficacy
and improved tolerability, a PRN (pro re nata) or “as needed” option, and a superior benefit-to-risk profile. (1) (2)

(1)
Ref: Louis ED, Ottman R. Tremor Other Kyperkinet Mov (NY). 2014;4:259.

(2)
Ref: Gerbasi et.al. Patient experiences in essential tremor: Mapping functional impacts to existing measures using qualitative research.
MDS 2023.

Other
Pipeline Candidates

We
continue to pursue opportunities for partnering and/or development arrangements for the continued development and/or marketing of LPCN
2401, LPCN 1148, and LPCN 1107. We do not currently anticipate conducting any further significant development activities with respect
to these products and product candidates without the participation of a partner. There can be no guarantee that we will be able to identify
or enter into partnering arrangements on terms that are beneficial to us or at all. Even if we do enter into partnering arrangements,
such arrangements may not be sufficient to successfully develop and commercialize these products.

LPCN
2401: Management of Incretin Mimetic Use in Obesity Management

LPCN
2401 is targeted to be a once daily oral formulation comprising a proprietary anabolic androgen receptor agonist. LPCN 2401 is expected
to have a favorable benefit to risk profile as a non-invasive option for use as an adjunct to GLP-1 chronic weight management therapies
for quality weight loss and/or as a monotherapy post cessation of GLP-1 chronic weight management therapies for weight and glycemic status
maintenance with demonstrated benefits to the liver.

LPCN
2401 has potential for use as an adjunct to incretin mimetics (GLP-1/GIP agonists) including amplification of GLP-1 insulinotropic actions
which is supported by studies demonstrating the role of androgen receptor agonist in regulation of GLP-1 through:

●
Enhancement of GLP-1-mediated insulin release from β cells through genomic- and non-genomic mechanisms

●
Increase in GLP-1 Receptor Expression in diabetics and non-diabetics

●
Promoting proliferation of β cells and improving insulin sensitivity

Target
benefits of LPCN 2401 in combination with GLP-1 agonists include inducing quality weight loss by attenuation of functionality and activities
of daily life while lessening lean mass loss, a serious unmet need, especially for elderly and sarcopenic adult GLP-1 agonist users who
are most vulnerable to accelerated lean mass loss and functional decline. In a recent study with 16 weeks of GLP-1 agonist use for weight
management in elderly (60 yr and above) patients, a rapid loss of lean mass was observed with a median percentage of total body weight
loss that is due to lean mass of 32% in 16 weeks. In addition, 43% of GLP-1 users lost ≥10% Stair Climb Power from baseline; the equivalent
of almost eight years of expected age-related stair climb power loss was observed in just 4 months of GLP-1 use.

Moreover,
as an adjunct to incretin mimetics, LPCN 2401 may help maintain or increase weight loss, particularly in diabetics, through increased
expression activity of GLP1R and increased effectiveness of GIP1 therapies secondary to actions at GLP1R (glucose lowering). LPCN 2401
could also be potentially used as monotherapy post discontinuation of GLP-1 agonist to manage weight/fat regain and durability of diabetes
remission.

Data
from preclinical and clinical studies support the potential of LPCN 2401 and LPCN 2401+E in improving body composition. In April 2024,
Lipocine announced results from a multi-center prospective, blinded Phase 2 study, which demonstrated increases in lean mass of 4.4%,
decreases in fat mass of 6.7%, reduction android fat 4.1%, and increased bone mineral content of 2.8% in a population consistent with
GLP-1 use for weight management. LPCN 2401 was well tolerated with minimal GI or androgenic adverse events and no reports of muscle spasms.

Per
FDA Guidance (2025), for efficacy claims related to changes in body composition, trial design should include appropriate choice of population
and selection of endpoints that measure how a patient feels, functions, or survives, to potentially support such a claim. We may initiate
a proof-of-concept study evaluating LPCN 2401 as an adjunct to GLP-1 agonist after we obtain additional regulatory clarity with respect
to development path and acceptable end points for improved body composition in obesity management pending available resources. We may
explore the possibility of partnering LPCN 2401 with a third party, although no partnering agreement has been entered into by us. No
assurance can be given that any license agreement will be completed, or, if an agreement is completed, that such an agreement would be
on terms favorable to us.

11

Disease
and Market Overview – GLP-1 Agonist Use and Obesity Management

Approximately
74% of U.S. adults aged 20 and older are either obese or overweight, and an estimated 30% of the U.S. adult population has a BMI ≥
30 kg/m2. Elderly and sarcopenic GLP-1 agonist users are the population of GLP-1 users who are most vulnerable to accelerated
lean mass loss and functional decline. Obesity is a chronic, relapsing health risk defined by excess body fat. Excess body fat increases
the risk of death and major comorbidities such as type 2 diabetes, hypertension, dyslipidemia, cardiovascular disease, osteoarthritis
of the knee, sleep apnea, and some cancers1. About 30% of overweight (BMI ≥ 25 kg/m2) adults 2 have
type 2 diabetes, 50%3 have dyslipidemia, and 67%4 have hypertension. In the U.S. alone, ~34M older adults aged 60+
years are obese (BMI at or above 30.0) and ~31M older adults aged 60+ years are overweight (BMI between 25.0 to 30).

It
is estimated that the total GLP-1 users in the U.S. may reach 30 million (around 9% of the overall population) by 20305.
Reportedly, ~24M6 obese elderly are most vulnerable to losing muscle mass. The rapid weight loss observed with the currently
approved chronic weight management GLP-1 receptor agonist medications includes unwanted lean mass loss, up to 40% of the patient’s
total weight lost. Moreover, discontinuation of these therapies frequently results in a rapid regain in weight. Loss of lean mass has
multiple negative health implications including weakness/fatigue, lowered metabolism which can cause a regain in fat mass, declines in
neuromuscular function, potential effects on emotion and psychological states, and increased risk of injury.

Several
recent studies showed that body composition, especially lean body mass (muscle) may play an independent role in survival of patients
with diseases such as cancer and cardiovascular diseases (DH Lee and EL Giovannucci, Exp Biol Med. 2018). Therefore, a focus on body
composition in obesity management to sustainably lose fat mass while maintaining lean mass should be an essential goal.

There
is a significant unmet need for an oral, efficacious, muscle preserving/gaining option for chronic obesity/weight management that ameliorates
the loss of lean mass associated with GLP-1/GIP agonist treatment, resulting in a higher quality weight loss. Moreover, there is a need
for a chronic long-term pharmacotherapy option to maintain weight upon cessation of incretin mimetic therapy, prevent fat/weight rebound
“overshoot” and minimize lag in muscle recovery to prevent collateral fattening as well as improve the durability of any
achieved diabetes remission while on GLP-1.

(1) Ref:
Caterson and Hubbard et al. 2004; Calle and Thun et al. 1999

(2) https://news.harvard.edu/gazette/story/2012/03/the-big-setup/

(3) https://www.ncbi.nlm.nih.gov/books/NBK305895/

(4) https://pmc.ncbi.nlm.nih.gov/articles/PMC6316192/#sec3-nutrients-10-01976

(5) https://www.jpmorgan.com/insights/global-research/current-events/obesity-drugs

(6) Ref:
Flynn et al. Morgan Stanley, February 27, 2024

LPCN
1148: Oral Product Candidate for the Management of Decompensated Cirrhosis

We
are currently evaluating LPCN 1148 comprising testosterone laurate (“TL”) for the management of decompensated cirrhosis.
We believe LPCN 1148 targets unmet needs for patients with cirrhosis including improvement in the quality of life of patients while on
the liver transplant waiting list, prevention or reduction in the occurrence of new decompensation events such as OHE, and improvement
in post liver transplant survival, including outcomes and costs. We are exploring the possibility of partnering with a third party for
the development and/or marketing of LPCN 1148, although no partnering agreement has been entered into by the Company. No assurance can
be given that any partnering agreement will be completed, or, if an agreement is completed, that such an agreement would be on terms
favorable to us.

We
conducted a Phase 2 proof of concept (“POC”) study (NCT04874350) in male subjects with cirrhosis to evaluate the therapeutic
potential of LPCN 1148 for the management of sarcopenia. The Phase 2 POC study was a prospective, multi-center, randomized, placebo-controlled
study in male sarcopenic patients with cirrhosis. Subjects were initially randomized 1:1 to 1 of 2 arms. The treatment arm was an oral
dose of LPCN 1148, and the second arm was a matching placebo. There were no restrictions on patients with respect to background therapies,
including current standard of care, diet or exercise. The primary endpoint was a change in skeletal muscle index at week 24 with key
secondary endpoints including change in liver frailty index, rates of breakthrough OHE, and number of waitlist events, including all-cause
mortality. Total treatment was 52 weeks, with 24-week placebo-controlled treatment subjects receiving LPCN 1148 in the 28-week open-label
extension (“OLE”) phase of the study for the duration of the study through week 52.

12

In
July 2023 we announced that the Phase 2 study met its primary endpoint, increased skeletal muscle index (L3-SMI) relative to placebo
(P<.01), in patients with cirrhosis. The study also demonstrated improvements in clinical outcomes such as prevention of new decompensation
events including OHE, rates of hospitalizations, and patient reported outcomes (“PROs”). LPCN 1148 was well-tolerated, with
adverse event (“AE”) rates and severities similar to placebo and no mortality was noted in the LPCN 1148 treatment group,
nor were there any cases of drug-induced liver injury.

In
March 2024 we announced that 24-week L3-SMI increases were maintained through 52 weeks of LPCN 1148 intervention and that placebo patients
who switched to LPCN 1148 in the open label extension period of the study had increases in L3-SMI. Furthermore, fewer OHE events were
observed in LPCN 1148 treated patients and time to first recurrent OHE event was longer for treated patients. LPCN 1148 was well-tolerated,
with AE rates and severities similar to placebo and fewer participants experienced serious or severe adverse events when switched from
placebo to LPCN 1148 and patients on therapy were hospitalized for fewer days. We had a Type D meeting with the FDA to discuss the clinical development
plan for LPCN 1148 for OHE, and we plan to continue discussions with the FDA seeking clarity on the Phase 3 study design and endpoint.

Disease
Overview – Cirrhosis

Annually,
cirrhosis has caused more than 1 million deaths, and there are over 500,000 people living with decompensated cirrhosis in the U.S.
Non-alcoholic fatty liver disease is the most rapidly increasing indication for liver transplant. 62% of those on the liver
transplant (“LT”) waitlist are male and the economic burden (approximately $812,500/transplant) is high and continues to
increase. Each year about half of the approximately 17,000 people in the U.S. on the LT waitlist undergo transplant, while nearly
3,000 patients either die or are removed from the list because they were “too sick to transplant.”

Liver
cirrhosis is defined as the histological development of regenerative nodules surrounded by fibrous bands. Patients with cirrhosis typically
have a years-long silent, asymptomatic phase (compensated cirrhosis) until decreasing liver function and increasing portal pressure move
the patient into the symptomatic phase (decompensated cirrhosis). Transition to decompensated cirrhosis is marked by clinical events
including ascites, encephalopathy, jaundice, and/or variceal hemorrhage. Decompensated subjects survive on average less than two years.
Common causes of liver cirrhosis include alcoholic liver disease, non-alcoholic fatty liver disease (“NAFLD”), chronic hepatitis
B and C, primary biliary cirrhosis, and primary sclerosing cholangitis and some patients have liver disease of unknown cause (cryptogenic).

Common
complications in patients with cirrhosis may include: compromised liver function, portal hypertension, varices in GI tract with internal
bleeding, edema, ascites, hepatic encephalopathy (“hepatic encephalopathy” or “HE”), compromised immunity with
post-transplant acute rejection risk, high sodium levels, increased bilirubin, low albumin level, insulin resistance with impaired peripheral
uptake of glucose, depression, accelerated muscle disorder in the form of sarcopenia, myosteatosis, and frailty with compromised energetics,
bone diseases (e.g., osteoporosis), high alkaline phosphatase (“ALP”), cachexia, malnutrition, weight loss (>5%), symptoms
of hypogonadism such as abnormal hair distribution, anemia, sexual dysfunction, testicular atrophy, muscle wasting, fatigue, osteoporosis,
gynecomastia, inflammation with elevated cytokines, and infection risk leading to hospital admissions and possibly death.

HE,
a significant decompensation event in patients with cirrhosis, is a brain dysfunction caused by liver insufficiency and/or portal systemic
shunting. Because the damaged liver cannot function normally (as in cirrhosis), neurotoxins such as ammonia are inadequately removed
from systemic circulation and travel to the brain, where they affect neurotransmission. This can cause episodes of HE, which may present
as alterations in consciousness, cognition, and behavior that range from minimal to severe. Overt HE occurs in 30% to 40% of patients
with cirrhosis at some point during the clinical course of their disease. As the burden of chronic liver disease and cirrhosis is increasing,
the frequency of HE is also increasing.

LPCN
1107: An Oral Product Candidate for the Prevention of Preterm Birth (“PTB”)

We
are exploring the possibility of partnering with a third party for the development and/or marketing of LPCN 1107, although no partnering
agreement has been entered into by us. No assurance can be given that any partnering agreement will be completed, or, if an agreement
is completed, that such an agreement would be on terms favorable to us.

We
believe LPCN 1107 has the potential to become the first oral hydroxyprogesterone caproate (“HPC”) product indicated for the
reduction of risk of PTB (delivery less than 37 weeks) in women with singleton pregnancy who have a history of singleton spontaneous
PTB. Prevention of PTB is a significant unmet need as approximately 11% of all U.S. pregnancies result in PTB, a leading cause of neonatal
mortality and morbidity.

13

Current
Status

We
have completed a multi-dose PK dose selection study in pregnant women. The objective of the multi-dose PK selection study was to assess
HPC blood levels in order to identify the appropriate LPCN 1107 Phase 3 dose. The multi-dose PK dose selection study was an open-label,
4-period, 4-treatment, randomized, single and multiple dose PK study in pregnant women with 3 dose levels of LPCN 1107 and the IM HPC
(Makena®). The study enrolled 12 healthy pregnant women (average age of 27 years) with a gestational age of approximately 16 to 19
weeks. Subjects received three dose levels of LPCN 1107 (400 mg BID, 600 mg BID, or 800 mg BID) in a randomized, crossover manner during
the first 3 treatment periods and then received 5 weekly injections of HPC during the fourth treatment period. During each of the LPCN
1107 treatment periods, subjects received a single dose of LPCN 1107 on Day 1 followed by twice daily administration from Day 2 to Day
8. Following completion of the 3 LPCN 1107 treatment periods and a washout period, all subjects received 5 weekly injections of HPC.
Results from this study demonstrated that average steady state HPC levels (Cavg0-24) were comparable or higher for all 3 LPCN 1107 doses
than for injectable HPC. Additionally, HPC levels as a function of daily dose were linear for the 3 LPCN 1107 doses. Also, unlike the
injectable HPC, steady state exposure was achieved for all 3 LPCN 1107 doses within 7 days.

A
traditional PK/PD based Phase 2 clinical study in the intended patient population is not expected to be required prior to entering into
Phase 3. Therefore, based on the results of our multi-dose PK study we had an End-of-Phase 2 meeting and subsequent guidance meetings
with the FDA to define a pivotal Phase 2b/3 development plan for LPCN 1107. We have completed a food effect study to characterize the
dosing regimen for the pivotal study and we have submitted a pivotal clinical study protocol to the FDA.

The
FDA has granted orphan drug designation to LPCN 1107 based on a major contribution to patient care. Orphan designation qualifies Lipocine
for various development incentives, including tax credits for qualified clinical testing, and a waiver of the prescription drug user
fee when we file our NDA.

Recent
Competition Update

On
October 5, 2020, the FDA’s Center for Drug Evaluation and Research (“CDER”) proposed that Makena be withdrawn from
the market because the PROLONG trial failed to verify the clinical benefit of Makena and concluded that the available evidence does not
show Makena is effective for its approved use and on April 6, 2023, the FDA withdrew its approval of Makena and ordered the immediate
withdrawal of Makena and several approved generic versions of the drug, making it unlawful for the drug to be distributed in the U.S.
The FDA stated that in light of the unmet need for a treatment preventing preterm birth and improving neonatal outcomes, it is imperative
that the medical and scientific communities increase their efforts to find effective treatments and stated their hope that the decision
to withdraw Makena will help galvanize further research. The FDA further stated their commitment to working together with patients, researchers,
and drug developers to advance the development of safe and effective therapies that are urgently needed as a treatment for the prevention
of preterm birth.

Research
and Development

As
disclosed in our development pipeline, we continue to build a diversified multi-asset pipeline of novel therapies. In 2025 and 2024,
we spent $8.6 million and $7.4 million, respectively, on research and development.

Competition

Neuroactive
Steroids Market overview

The
unique potential mechanism of action (“MOA”) of NAS presents an opportunity to treat a variety of CNS disorders. Accordingly,
multiple NASs as GABAA receptor PAMs are in active development for varied indications. Some companies engaged in development/commercialization
include Seaport Therapeutics and Praxis Precision Medicines.

Postpartum
Depression

SAGE
Therapeutics’ product ZURZUVAE (zuranolone), an oral, once-daily, 14-day treatment for PPD was approved by the FDA in August 2023.
ZURZUVAE became commercially available in December 2023. In October 2024, SAGE Therapeutics announced plans to discontinue marketing
their injectable version of an endogenous neuroactive steroid, brexanolone, ZULRESSO™, for treatment in PPD in order to focus their
commercial efforts on ZURZUVAE. In June 2025, Sage announced the acquisition of Sage by Supernus Pharmaceuticals (“Supernus”)
and Supernus’ intention to strengthen their leading presence in neuropsychiatric conditions with Sage’s innovative commercial
product, ZURZUVAE. The transaction closed in the third quarter of 2025.

Cirrhosis
Market Overview

Decompensated
cirrhosis patients with sarcopenia exhibit significantly shorter overall survival than those without sarcopenia. There are no therapies
specifically approved for sarcopenia or decompensated cirrhosis. Currently, the only curative therapy for decompensated cirrhosis is
liver transplant; however, liver transplantation is very costly, limited by the supply of available donors, and has a high risk of post-operative
complications.

14

Xifaxan®
(rifaximin) is the only FDA-approved medicine indicated for the reduction in risk of overt hepatic encephalopathy recurrence in adults,
a decompensation event typically associated with liver cirrhosis. Reportedly, Xifaxan sales for the 12-month period ending November 2024
totaled ~ $2.5B.

Currently,
there are no FDA approved drugs to treat secondary sarcopenia in decompensated cirrhosis beyond treatment of the underlying conditions.
Lipocine is a leader in pursuing treatment for subjects with decompensated cirrhosis with sarcopenia, however, there are candidates known
to be under development for cirrhosis related indication(s).

GB
1211 (by Galecto), an oral galectin-3 inhibitor for advanced liver cirrhosis targeted for directly addressing fibrosis is in development
being assessed in patients with moderate-to-severe cirrhosis (Child-Pugh classes B and C).

On
January 23, 2026, Bausch Health (“Bausch”) announced its Phase 3 trials for reformulated rifaximin SSD for the primary prevention
of hepatic encephalopathy in patients with decompensated Cirrhosis, failed to meet their main objectives. Reportedly, topline data is
anticipated in the first half of 2026. Bausch announced that they are currently reviewing the full dataset to determine potential new
development opportunities.

Testosterone
Replacement Therapy Market Overview

The
gel-based testosterone replacement products that are currently available include AbbVie’s AndroGel®, Lilly and Company’s
Axiron® Topical Solution and Endo’s Testim® and Fortesta® along with their respective authorized generics as
well as the equivalent generic versions of each. Transdermal patches include Allergan’s Androderm®. Intramuscular forms of
testosterone also exist although commercialized mostly in generic forms by multiple companies and in branded form as Aveed® by Endo.
Additionally, Endo markets the buccal testosterone replacement therapy Striant® and the Testopel® implantable testosterone pellets,
which it acquired from Auxillium in 2015. Antares Pharma, Inc. markets a sub-cutaneous weekly auto-injector testosterone therapy, Xyosted®.
Acerus Pharmaceuticals markets an intranasal testosterone therapy, NATESTO®. Finally, Tolmar Pharmaceuticals markets an oral TRT,
JATENZO®, which received FDA approval in March 2019 and Marius Pharmaceuticals markets an oral TU, KYZATREX®, which received
FDA approval for treatment of those with Klinefelter’s Syndrome in August 2022.

Currently,
intramuscular injections have the highest market share in the testosterone replacement market in terms of annual prescriptions. While
gels are also a widely used form of TRT, there is a risk of transference; additionally, the gels are messy to apply and have significant
compliance issues leading to high rates of discontinuance among patients. Additionally, certain intramuscular injections have the potential
to cause pulmonary embolisms as well as cause injection site reactions, scarring, pain and risk of infection in patients. We believe
a safe and effective oral therapy could potentially increase patient convenience and compliance, while eliminating the testosterone transference
risk associated with gels and injection site reaction of injectables.

The
FDA has granted a therapeutic equivalence rating of AB to “generic” versions of approved products which have been approved
via a 505(b)(2) NDA. In July 2014, the FDA granted the AB rating to Perrigo’s 1% testosterone gel drug product (NDA 203098) approved
in January 2013, and a BX rating to Teva’s 1% gel drug product (NDA 202763) approved in February 2012. Each is a version of AbbVie’s
AndroGel 1.0% and employed 505(b)(2) submissions citing AndroGel as their reference listed drugs. Teva’s version was found to be
bioinequivalent to AndroGel, hence the BX rating. Upsher-Smith Laboratories also received approval for a version of Endo’s Testim
(Vogelxo™; NDA 204399) in June 2014 using the same pathway. In January of 2015, the FDA determined that Vogelxo™ is therapeutically
equivalent to Testim and received an AB rating. In August 2015, the FDA granted AB rating to Perrigo’s 1.62% testosterone gel drug
product (NDA 204268) which also received FDA approval in August 2015. Lilly and Company and Acrux’s Axiron had patent expiry in
February 2017. On July 6, 2017, Acrux confirmed that a generic version of Axiron® Topical Solution, 30 mg/1.5 mL (Testosterone Topical
Solution, 30 mg/1.5 mL) has been launched in the United States by Perrigo Company plc. Acrux also confirmed the availability of an authorized
generic version of Axiron in the United States, through a marketing and distribution agreement between Lilly and Company and a leading
authorized generics company.

Hydroxyprogesterone
caproate, or HPC, Preterm Birth, or PTB, Market Overview

PTB
is defined as delivery before 37 weeks of gestation. The only previously approved therapy for prevention of PTB in women with a prior
history of at least one preterm birth (approximately 145,000 pregnancies annually) which was a weekly intramuscular injection of HPC,
marketed by Covis under the brand name Makena®, was pulled from the market effective April 6, 2023, because the PROLONG trial failed
to verify the clinical benefit of Makena. The FDA concluded that the available evidence does not show Makena is effective for its approved
use and withdrew its approval of Makena and ordered the immediate withdrawal of Makena and several approved generic versions of the drug,
making it unlawful for the drug to be distributed in the U.S.

15

Intellectual
Property

Drug
Delivery Technologies for Lipophilic Drug Substances

Our
patent portfolio is directed to various types of compositions and methods for delivery of lipophilic drugs, which are drugs that are
soluble in lipids. Our FDA approved product, TLANDO, is an oral formulation of the lipophilic prodrug TU, utilizing our proprietary technology
for improved delivery of lipophilic therapeutic agents.

As
of March 10, 2026, our intellectual property patent portfolio consists of various issued patents and patent applications related to Oral
TU, LPCN 1111, LPCN 1107, LPCN 1144/1148, LPCN 1154, and LPCN 2401 both in the U.S. and in multiple countries outside of the U.S.

We
also hold license rights in the field of cough and cold, to two U.S. patents and one U.S. application (and related foreign patents and
applications) that we previously assigned to Spriaso LLC, which could be possibly used with future product candidates.

Additionally,
we have 14 U.S. patents that are listed in the FDA Orange Book for TLANDO that are expected to expire between 2029 and 2041. If we or
our Licensee are marketing the TLANDO product at the time the patents expire and have no other issued U.S. patents covering the product,
then we will lose certain advantages that come with FDA Orange Book listing of patents and will no longer be able to prevent others in
the U.S. from practicing the inventions claimed by the 14 patents.

We
expect to file new patent applications in the future to further cover various aspects of our products and product development.

See
Item 3 – Legal Proceedings, for a discussion of intellectual property related legal proceedings.

Government
Regulation

The
Regulatory Process for Drug Development

The
production and manufacture of our product candidates and our research and development activities are subject to regulation by various
governmental authorities around the world. In the United States, drugs and products are subject to regulation by the FDA. There are other
comparable agencies in Europe and other parts of the world. Regulations govern, among other things, the research, development, testing,
manufacture, quality control, approval, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, post-approval
monitoring and reporting, marketing and export and import of products. Applicable law requires licensing and registration of manufacturing
and contract research facilities, carefully controlled research and testing of products, governmental review and/or approval of results
prior to marketing therapeutic products. Additionally, adherence to good laboratory practices, or GLP, good clinical practices, or GCP,
during clinical testing and current good manufacturing practices, or cGMP, during production is required. Following FDA approval of a
drug product, drug manufacturers are subject to continuing regulation by the FDA, including, among other things, record-keeping requirements,
reporting of adverse experiences with the product, providing the FDA with updated safety and efficacy information, and promotion and
advertising rules, among others. The system of new drug approval in the United States is generally considered to be the most rigorous
in the world and is described in further detail below under “United States Pharmaceutical Product Development Process.”

United
States Pharmaceutical Product Development Process

In
the United States, the FDA regulates pharmaceutical products under the Federal Food, Drug and Cosmetic Act and the regulations it implements.
The testing, production, sale, promotion, and pricing of pharmaceutical products are also subject to other federal, state and local statutes
and regulations. The process of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state, local and
foreign statutes and regulations require the expenditure of substantial time and financial resources. Failure to comply with the applicable
United States requirements at any time during the product development process, approval process or after approval, may subject an applicant
to administrative or judicial sanctions. FDA sanctions could include refusal to approve pending applications, withdrawal of an approval,
a clinical hold, warning letters, product recalls, product seizures, total or partial suspension of production or distribution injunctions,
fines, refusals of government contracts, restitution, disgorgement or civil or criminal penalties. Any agency or judicial enforcement
action could have a material adverse effect on us.

16

It
takes many years for a typical experimental drug to go from concept to approval. The process required by the FDA before a pharmaceutical
product may be marketed in the United States generally includes the following:

● Completion
of preclinical laboratory tests and animal studies. The latter, often conducted according
to GLPs or other applicable regulations, as well as synthesis and drug formulation development
leading ultimately to clinical drug supplies manufactured according to cGMPs;

● Submission
to the FDA of an Investigational New Drug application (“IND”), which must be
submitted to the FDA and become effective before human clinical trials may begin in the United
States;

● Performance
of adequate and well-controlled human clinical trials according to the FDA’s current
GCPs, to establish the safety and efficacy of the proposed pharmaceutical product for its
intended use;

●
Submission to the FDA of
an NDA for a new pharmaceutical product;

● Satisfactory
completion of an FDA inspection of the manufacturing facility or facilities where the pharmaceutical
product is produced to assess compliance with the FDA’s cGMP to assure that the facilities,
methods and controls are adequate to preserve the pharmaceutical product’s identity,
strength, quality and purity;

●
Potential FDA audit of the
preclinical and clinical trial sites that generated the data in support of the NDA; and

●
FDA review and approval of
the NDA.

The
lengthy process of seeking required approvals and the continuing need for compliance with applicable statutes and regulations require
the expenditure of substantial resources and FDA approval is inherently uncertain.

Preclinical
Studies: Prior to preclinical studies, a research phase takes place which involves demonstration of target and function, design,
screening and synthesis of agonists or antagonists. Preclinical studies include laboratory evaluations of product chemistry, toxicity
and formulation, as well as animal studies to evaluate efficacy and activity, toxic effects, pharmacokinetics (“PKs”) and
metabolism of the pharmaceutical product candidate and to provide evidence of the safety, bioavailability and activity of the pharmaceutical
product candidate in animals. The conduct of the preclinical safety evaluations must comply with federal regulations and requirements
including GLPs. The results of the formal IND-enabling preclinical studies, together with manufacturing information, analytical data,
any available clinical data or literature as well as the comprehensive descriptions of proposed human clinical studies, are then submitted
as part of the IND application to the FDA.

The
IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA places the IND on a clinical hold within that 30-day
time period. In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. The
FDA may also impose clinical holds on a pharmaceutical product candidate at any time before or during clinical trials due to safety concerns
or non-compliance. Accordingly, we cannot be certain that submission of an IND will result in the FDA allowing clinical trials to begin,
or that, once begun, issues will not arise that suspend or terminate such clinical trial.

Clinical
Trials: Clinical trials involve the administration of the pharmaceutical product candidate to healthy volunteers or patients under
the supervision of qualified investigators, generally physicians not employed by the sponsor. Clinical trials are conducted under protocols
detailing, among other things, the objectives of the clinical trial, dosing procedures, subject selection and exclusion criteria, and
the parameters to be used to monitor subject safety. Each protocol must be submitted to the FDA if conducted under a U.S. IND. Clinical
trials must be conducted in accordance with the FDA’s GCP requirements. Further, each clinical trial must be reviewed and approved
by an independent institutional review board, or IRB, or ethics committee at or servicing each institution at which the clinical trial
will be conducted. An IRB or ethics committee is charged with protecting the welfare and rights of trial participants and considers such
items as whether the risks to individuals participating in the clinical trials are minimized and are reasonable in relation to anticipated
benefits. The IRB or ethics committee also approves the informed consent form that must be provided to each clinical trial subject or
his or her legal representative and must monitor the clinical trial until completed.

Human
clinical trials are typically conducted in three sequential phases that may overlap or be combined:

Phase
1 Clinical Trials: Phase 1 clinical trials are usually first-in-man trials, take approximately 1 to 2 years to complete and are generally
conducted on a small number of healthy human subjects to evaluate the drug’s activity, schedule and dose, PKs and pharmacodynamics.
However, in the case of life-threatening diseases, such as cancer, the initial Phase 1 testing may be done in patients with the disease.
These trials typically take longer to complete and may provide insights into drug activity.

Phase
2 Clinical Trials: Phase 2 clinical trials can take approximately 1 to 3 years to complete and are carried out on a relatively small
to moderate number of patients (as compared to Phase 3) in a specific indication. The pharmaceutical product is evaluated to preliminarily
assess efficacy, to identify possible adverse effects and safety risks, and to determine optimal dose, regimens, PKs, pharmacodynamics
and dose response relationships. This phase also provides additional safety data and serves to identify possible common short-term side
effects and risks in a larger group of patients. Phase 2 clinical trials sometimes include randomization of patients.

Phase
3 Clinical Trials: Phase 3 clinical trials take approximately 2 to 5 years to complete and involve tests on a much larger population
of patients (several hundred to several thousand patients) suffering from the targeted condition or disease. These studies usually include
randomization of patients and blinding of both patients and investigators at geographically dispersed test sites (multi-center trials).
These trials are undertaken to further evaluate dosage, clinical efficacy and safety and are intended to establish the overall risk/benefit
ratio of the product and provide an adequate basis for product labeling. Generally, 2 adequate and well-controlled Phase 3 clinical trials
are required by the FDA for approval of an NDA or foreign authorities for approval of NDAs.

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Post-approval
studies, or Phase 4 clinical trials, may be conducted after initial marketing approval. These studies are used to gain additional experience
from the treatment of patients in the intended therapeutic indication and may be required by the FDA as a condition of approval.

Progress
reports detailing the results of the clinical trials must be submitted at least annually to the FDA, and written IND safety reports must
be submitted to the FDA and the investigators for serious and unexpected adverse events or for any finding from tests in laboratory animals
that suggests a significant risk for human subjects. Phase 1, Phase 2 and Phase 3 clinical trials may not be completed successfully within
any specified period, if at all. The FDA or the sponsor or, if used, its data safety and monitoring board 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 or ethics committee 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 or ethics committee’s requirements or if the pharmaceutical product
has been associated with unexpected serious harm to patients.

Concurrent
with clinical trials, companies usually complete additional animal studies and must also develop additional information about the chemistry
and physical characteristics of the pharmaceutical product, as well as finalize a process for manufacturing the product in commercial
quantities in accordance with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches
of the pharmaceutical product candidate and, among other things, must develop methods for testing the identity, strength, quality and
purity of the final pharmaceutical product. Additionally, appropriate packaging must be selected and tested, and stability studies must
be conducted to demonstrate that the pharmaceutical product candidate does not undergo unacceptable deterioration over its shelf life.

U.S.
Pharmaceutical Review and Approval Process

New
Drug Application: Upon completion of pivotal Phase 3 clinical studies, the sponsor assembles all the product development, preclinical
and clinical data along with descriptions of the manufacturing process, analytical tests conducted on the chemistry of the pharmaceutical
product, proposed labeling and other relevant information, and submits it to the FDA as part of an NDA. The submission or application
is then reviewed by the regulatory body for approval to market the product. This process typically takes 8 months to 1 year to complete.
The FDA may refuse to approve an NDA if the applicable regulatory criteria are not satisfied or may require additional clinical data
or other data and information. Even if such data and information is submitted, the FDA may ultimately decide that the NDA does not satisfy
the criteria for approval. If a product receives regulatory approval, the approval may be limited to specific diseases and dosages or
the indications for use may otherwise be limited, which could restrict the commercial value of the product. Further, the FDA may require
that certain contraindications, warnings or precautions be included in the product labeling.

Orphan
Drug Designation

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

If
a product that has orphan drug designation subsequently receives the first FDA approval for the disease 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 for the same indication, except in very limited circumstances, for 7 years. Orphan drug exclusivity, however, could also block
the approval of one of our products for seven years if a competitor obtains approval of the same drug as defined by the FDA or if our
drug candidate is determined to be contained within the competitor’s product for the same indication or disease.

Priority
Review

Priority
Review is a designation for an NDA after it has been submitted to the FDA for review. Reviews for NDAs are designated as either “Standard”
or “Priority.” A Standard designation sets the target date for completing all aspects of a review and the FDA taking an action
on 90% of applications (i.e., approve or not approve) at 12 months after the date it was submitted for drugs considered new molecular
entities and at 10 months after the date it was submitted for drugs considered non-new molecular entities. A Priority designation sets
the target date for the FDA action on 90% of applications at eight months after submission for drugs considered new molecular entities
and at 6 months after submission for drugs considered non-new molecular entities. A Priority designation is intended for those products
that address unmet medical needs.

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Accelerated
Approval

Accelerated
Approval or Subpart H Approval is a program described in the NDA regulations that is intended to make promising products for life threatening
diseases available on the basis of evidence of effect on a surrogate endpoint prior to formal demonstration of patient benefit. A surrogate
marker is a measurement intended to substitute for the clinical measurement of interest, usually prolongation of survival in oncology
that is considered likely to predict patient benefit. The approval that is granted may be considered a provisional approval with a written
commitment to complete clinical studies that formally demonstrate patient benefit.

Post-Approval
Requirements

Any
pharmaceutical products for which we may receive FDA approval are subject to continuing regulation by the FDA, including, among other
things, record-keeping requirements, reporting of adverse experiences with the product, providing the FDA with updated safety and efficacy
information, product sampling and distribution requirements, complying with certain electronic records and signature requirements and
complying with the FDA promotion and advertising requirements, which include, among others, standards for direct-to-consumer advertising,
prohibitions on promoting pharmaceutical products for uses or in patient populations that are not described in the pharmaceutical product’s
approved labeling (known as “off-label use”), industry-sponsored scientific and educational activities and promotional activities
involving the internet. Failure to comply with the FDA requirements can have negative consequences, including adverse publicity, enforcement
letters from the FDA, removal of a product from the market, mandated corrective advertising or communications with doctors and civil
or criminal penalties.

The
FDA also may require post-marketing testing, known as Phase 4 testing, risk evaluation and mitigation strategies and surveillance to
monitor the effects of an approved product or place conditions on an approval that could restrict the distribution or use of the product.

Other
Healthcare Laws and Compliance Requirements

In
the United States, our activities are potentially subject to regulation by various federal, state and local authorities in addition to
the FDA, including, but not limited, to the Centers for Medicare and Medicaid Services and other divisions of the United States government,
including the U.S. Federal Communications Commission, the Department of Health and Human Services, the U.S. Department of Justice and
individual U.S. Attorney offices within the Department of Justice, and state and local governments. For example, if a drug product is
reimbursed by Medicare, Medicaid, or other federal or state healthcare programs, our Company, including our sales, marketing and scientific/educational
grant programs, among others, must comply with federal healthcare laws, including, but not limited to, the federal Anti-Kickback Statute,
false claims laws, civil monetary penalties laws, healthcare fraud and false statement provisions and data privacy and security provisions
under the Health Insurance Portability and Accountability Act, or HIPAA, the Physician Payment Sunshine Act, and any analogous state
laws. If a drug product is reimbursed by Medicare or Medicaid, pricing and rebate programs must comply with, as applicable, the Medicaid
rebate requirements of the Omnibus Budget Reconciliation Act of 1990 (“OBRA”) and the Medicare Prescription Drug Improvement
and Modernization Act of 2003. Among other things, OBRA requires drug manufacturers to pay rebates on prescription drugs to state Medicaid
programs and empowers states to negotiate rebates on pharmaceutical prices, which may result in prices for our future products that will
likely be lower than the prices we might otherwise obtain. Additionally, the Patient Protection and Affordable Care Act as amended by
the Health Care and Education Reconciliation Act of 2010 (collectively, “ACA”) substantially changes the way healthcare is
financed by both governmental and private insurers. Among other cost containment measures, ACA establishes: an annual, nondeductible
fee on any entity that manufactures or imports certain branded prescription drugs and biologic agents; a new Medicare Part D coverage
gap discount program; and a new formula that increases the rebates a manufacturer must pay under the Medicaid Drug Rebate Program. There
may continue to be additional proposals relating to the reform of the U.S. healthcare system, in the future, some of which could further
limit coverage and reimbursement of drug products. If drug products are made available to authorized users of the Federal Supply Schedule
of the General Services Administration, additional laws and requirements may apply.

Additionally,
to the extent that any of our products are sold in a foreign country, we may be subject to similar foreign laws and regulations, which
may include, for instance, applicable post-marketing requirements, including fraud and abuse, privacy and transparency laws.

Pharmaceutical
Coverage, Pricing and Reimbursement

In
the United States and markets in other countries, sales of any products for which we receive regulatory approval for commercial sale
will depend in part on the availability of coverage and adequate reimbursement from third-party payers, including government health administrative
authorities, managed care providers, private health insurers and other organizations. In the United States, private health insurers and
other third-party payers often provide reimbursement for products and services based on the level at which the government (through the
Medicare or Medicaid programs) provides reimbursement for such treatments. Third-party payers are increasingly examining the medical
necessity and cost-effectiveness of medical products and services in addition to their safety and efficacy and, accordingly, significant
uncertainty exists as to the coverage and reimbursement status of newly approved therapeutics. In particular, in the United States, the
European Union and other potentially significant markets for our product candidates, government authorities and third-party payers are
increasingly attempting to limit or regulate the price of medical products and services, particularly for new and innovative products
and therapies, which has resulted in lower average selling prices. Further, the increased emphasis on managed healthcare in the United
States and on country and regional pricing and reimbursement controls in the European Union will put additional pressure on product pricing,
reimbursement and usage, which may adversely affect our future product sales and results of operations. These pressures can arise from
rules and practices of insurers and managed care organizations, judicial decisions and governmental laws and regulations related to Medicare,
Medicaid and healthcare reform, pharmaceutical reimbursement policies and pricing in general. As a result, coverage and adequate third-party
reimbursement may not be available for our products to enable us to realize an appropriate return on our investment in research and product
development.

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The
Inflation Reduction Act of 2022 (Pub. L. No. 117-169) includes a number of provisions aimed at lowering prescription drug costs and reducing
government spending on drugs. This includes a requirement that the Department of Health and Human Services negotiate a “maximum
fair price” with drug manufacturers for certain single-source brand drugs or biologics without generic or biosimilar competitors
that are covered under Medicare Part D and Part B. This pricing began in 2026 for Medicare Part D and will begin in 2028 for Medicare
Part B. An excise tax is imposed on drug manufacturers that fail to comply with the required negotiation process. In addition, the law
requires drug manufacturers to pay a rebate to the federal government if the price for almost all drugs covered under Medicare Part D
(starting in 2022), and single-source drug or biologics covered under Medicare B (starting in 2023), increase greater than the inflation
rate. The rebate amount equals the number of drug units sold in Medicare multiplied by the amount the drug’s price exceeds the
inflation-adjusted price. The law also modifies the Medicare Part D benefit structure to cap the amount beneficiaries must spend on drug
costs and increase the discounts manufacturers are required to pay. The Inflation Reduction Act of 2022 signals an increased desire to
control the prices and costs associated with pharmaceutical products.

In
January 2026, the Department of Health and Human Services Office of Inspector General issued a Special Advisory Bulletin on the applicability
of the federal Anti-Kickback Statue to direct-to-consumer prescription drugs sales by manufacturers to patients with federal health care
coverage. This guidance permits pharmaceutical manufacturers to sell prescription drugs directly to patients who choose to pay cash,
including those in federal health care programs, when the agreement meets other anti-kickback conditions. This bulletin signals an increased
desire by the federal government to expand how pharmaceutical manufacturers can sell products directly to consumers as part of an effort
to control drugs prices paid by consumers.

In
recent years, state laws have been enacted to lower prescription drug costs and prices. In some states, such as Colorado and Maryland,
a drug affordability board was created to identify specific drugs that are particularly costly or otherwise create affordability challenges.
These drug affordability boards have authority to either implement or recommend upper payment limits for these drugs. This legislation,
as well as any future statutes or regulations at the federal or state level, may impact reimbursement for our product candidates and
may challenge our ability to realize an appropriate return on our investment in research and product development.

The
market for our product candidates for which we may receive regulatory approval will depend significantly on access to third-party payers’
drug formularies or lists of medications for which third-party payers provide coverage and reimbursement. The industry competition to
be included in such formularies often leads to downward pricing pressures on pharmaceutical companies. Also, third-party payers may refuse
to include a particular branded drug in their formularies or may otherwise restrict patient access to a branded drug when a less-costly
generic equivalent or other alternative is available. In addition, because each third-party payer individually approves coverage and
reimbursement levels, obtaining coverage and adequate reimbursement is a time-consuming and costly process. We would be required to provide
scientific and clinical support for the use of any product to each third-party payer separately with no assurance that approval would
be obtained, and we may need to conduct expensive pharmacoeconomic studies in order to demonstrate the cost-effectiveness of our products.
This process could delay the market acceptance of any of our product candidates for which we may receive approval and could have a negative
effect on our future revenues and operating results. We cannot be certain that our product candidates will be considered cost-effective.
If we are unable to obtain coverage and adequate payment levels for our product candidates from third-party payers, physicians may limit
how much or under what circumstances they will prescribe or administer them, and patients may decline to purchase them. This in turn
could affect our ability to successfully commercialize our products and impact our profitability, results of operations, financial condition,
and future success.

Related
Party Transaction

On
July 23, 2013, we entered into assignment/license and services agreements with Spriaso, an entity that is majority-owned by Mahesh V.
Patel, Gordhan Patel, John W. Higuchi, the late Dr. William I. Higuchi, and their affiliates. Mahesh V. Patel is our President and Chief
Executive Officer. Mr. Higuchi is a member of our Board of Directors and Gordhan Patel and Dr. Higuchi, former Board members, were each
members of our Board of Directors at the date the license and agreements were entered into.

Under
the assignment agreement, we assigned and transferred to Spriaso all of our rights, title and interest in our intellectual property for
the cough and cold field. In addition, Spriaso was assigned all rights and obligations under our product development agreement with a
co-development partner. In exchange, we would be entitled to receive a potential cash royalty of 20% of the net proceeds received by
Spriaso, up to a maximum of $10 million. Spriaso also granted back to us an exclusive license to such intellectual property to develop
products outside of the cough and cold field. The assignment agreement will expire upon the expiration of all of Spriaso’s payment
obligations thereunder and the expiration of all of the licensed patents thereunder. Spriaso has the right to terminate the assignment
agreement with 30 days written notice. We have the right to terminate the assignment agreement upon the complete liquidation or dissolution
of Spriaso, unless the assignment agreement is assigned to an affiliate or successor of Spriaso.

20

Under
the services agreement, we agreed to provide facilities and up to 10% of the services of certain employees to Spriaso for a period of
time. The agreement to provide services expired in 2021; however, it may be extended upon written agreement of Spriaso and us. Additionally,
Spriaso filed its first NDA in 2014, and as an affiliated entity of Lipocine, it used up the one-time waiver of user fees for a small
business submitting its first human drug application to FDA.

Employees

As
of December 31, 2025, we had 14 full-time employees, and we also utilize the services of consultants on a regular basis. Nine employees
are engaged in drug development activities and five are in general and administration functions and the majority of our employees work
out of our Salt Lake City facility. The Company continually evaluates the business need and opportunity
and balances in-house expertise and capacity with outsourced expertise and capacity. Currently, we outsource substantial clinical trial
work to clinical research organizations and certain drug manufacturing to contract manufacturers. None of our employees are represented
by labor unions or covered by collective bargaining agreements and we consider our relations with our employees to be good.

We
strive toward having a diverse team of employees and are committed to equality, inclusion and workplace diversity.

Reverse
Stock Split

On
May 10, 2023, our Board of Directors approved a reverse stock split of 1-for-17. We filed an Amendment to our Certificate of Incorporation
with the Secretary of the State of Delaware on May 10, 2023, and the Amendment became effective at 5:00 pm Eastern Time on May 11, 2023.
Our shares began trading on a split-adjusted basis on the Nasdaq Capital Market commencing upon market open on May 12, 2023. The par
value of the common stock and preferred stock was not adjusted as a result of the reverse stock split. All common stock and per share
amounts in the financial statements have been retroactively adjusted for all periods presented to give effect to the reverse stock splits.

Available
Information

Our
website address is www.lipocine.com. We make available free of charge on the Investor Relations portion of our website our annual reports
on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant
to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish
it to, the SEC. The SEC maintains an internet website that contains reports, proxy and information statements, and other information
that we file electronically, which can be found at http://www.sec.gov.