Annual report [Section 13 and 15(d), not S-K Item 405]

Summary of Significant Accounting Policies (Policies)

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2025

Basis of Presentation and Principles of Consolidation

Basis of Presentation and Principles of Consolidation

The accompanying financial statements have been prepared in accordance with the accounting principles generally accepted in the United States of America. The Company’s former wholly-owned subsidiaries, Oxis Biotech, Inc. and Georgetown Translational Pharmaceuticals, Inc., were both dissolved on October 22, 2024. Prior to their dissolution, the operations of Oxis Biotech, Inc. and Georgetown Translational Pharmaceuticals, Inc. were limited with insignificant assets and liabilities.

Accounting Estimates

Accounting Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include management’s estimates for continued liquidity, accruals for potential liabilities, assumptions used in deriving the fair value of warrant liabilities and Greenshoe Rights liability, valuation of equity instruments issued for debt and services and realization of deferred tax assets.

Cash Equivalents

Cash Equivalents

The Company considers highly liquid investments with maturities of three months or less at the date of acquisition as cash equivalents in the accompanying financial statements. As of December 31, 2025 and 2024, total cash equivalents which consist of money market funds, amounted to approximately $3.9 million and $3.8 million, respectively.

Restricted Cash

Restricted Cash

As of December 31, 2025 and 2024, the Company has classified certain cash balances as restricted cash in its balance sheets. The Company’s restricted cash is deposited in a financial institution and held as a collateral for a credit card agreement with the same financial institution.

Deferred Offering Costs

Deferred Offering Costs

The Company capitalizes the fair value of equity instruments granted and certain legal, accounting and other third-party fees that are directly related to the Company’s in-process equity financings until such financings are consummated. After consummation of an equity financing, these costs are recorded in stockholders’ equity as a reduction of additional paid-in capital generated as a result of the offering. Should a planned equity financing be abandoned, terminated or significantly delayed, the deferred offering costs are immediately written off to operating expenses. As of December 31, 2025, there was $634,000 of deferred offering costs on the balance sheet.

Warrants

Warrants

The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own common stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all of the criteria for equity classification, the warrants are required to be liability classified and recorded at their initial fair value on the date of issuance and remeasured at fair value at each balance sheet date thereafter. Changes in the estimated fair value of the warrants that are liability classified are recognized as a non-cash gain or loss in the statement of operations at each balance sheet date.

The Company’s use of derivative financial instruments is generally limited to warrants issued by the Company that do not meet the criteria for equity treatment and are recorded as liabilities. We do not use financial instruments or derivatives for any trading purposes.

Greenshoe Rights

Greenshoe Rights

In connection with the issuance of the Company’s Series L Convertible Preferred Stock (see Note 5), the Company issued additional investment rights (“Greenshoe Rights”). The Company evaluated the Greenshoe Rights in accordance with ASC 480. As the call option was linked to preferred stock that included redemption features that could require cash settlement upon events outside the Company’s control, the instrument was classified as a liability and initially recognized at fair value. The Greenshoe Rights liability was subsequently remeasured at fair value at each reporting date, with changes in fair value recognized in earnings within other income (expense). Upon execution of the September 2025 waiver eliminating the redemption features, the Greenshoe Rights liability was reclassified to equity at its then-current fair value.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820-10 requires entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet for which it is practicable to estimate fair value. ASC 820-10 defines the fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties.

The three levels of the fair value hierarchy are as follows:

Level 1 Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.

Level 2 Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.

Level 3 Valuations based on inputs that are unobservable, supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The carrying amounts of the Company’s other financial assets and liabilities, such as cash and cash equivalents, short-term investments, prepaid expenses and other current assets, accounts payable, accrued expenses, approximate their

The following table sets forth by level, within the fair value hierarchy, the Company’s liabilities at fair value as of December 31, 2025 and 2024 (as of December 31, 2025 and 2024, no assets were at fair value):

Schedule of Liabilities Fair Value

	Level 1		Level 2		Level 3		Total
	December 31, 2025
	Level 1		Level 2		Level 3		Total

Liabilities
Greenshoe rights liability	$	-	$	-	$	-	$	-
Warrant liability		-		-		11,000		11,000
Total liabilities	$	-	$	-	$	11,000	$	11,000

	Level 1		Level 2		Level 3		Total
	December 31, 2024
	Level 1		Level 2		Level 3		Total

Liabilities
Warrant liability	$	-	$	-	$	252,000	$	252,000
Total liabilities		-		-	$	252,000	$	252,000

The change in Level 3 liabilities measured at fair value for the years ended December 31, 2025 and 2024 were as follows:

Warrant Liability

	Warrant Liability			Greenshoe Rights
Balance - December 31, 2023	$	1,052,000		$	-
Change in fair value of warrant derivative liability		(800,000	)		-
Balance - December 31, 2024		252,000			-
Initial recognition of Greenshoe Rights liability		-			28,736,000
Change in fair value of warrant derivative liability		(241,000	)		(11,413,000	)
Reclassification of greenshoe rights liability to equity		-			(17,323,000	)
Balance - December 31, 2025	$	11,000		$	-

Stock-Based Compensation

Stock-Based Compensation

The Company periodically issues stock-based compensation to officers, directors, employees, and consultants for services rendered. Such issuances vest and expire according to terms established at the issuance date.

Stock-based payments to officers, directors, employees, and consultants in exchange for goods and services, which include grants of employee stock options, are recognized in the financial statements based on their grant date fair values in accordance with ASC 718, Compensation-Stock Compensation. Stock based payments to officers, directors, employees, and consultants, which are generally time vested, are measured at the grant date fair value and depending on the conditions associated with the vesting of the award, compensation cost is recognized on a straight-line or graded basis over the vesting period. Recognition of compensation expense for non-employees is in the same period and manner as if the Company had paid cash for the services. The fair value of stock options granted is estimated using the Black-Scholes option-pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life, and future dividends. The assumptions used in the Black-Scholes option pricing model could materially affect compensation expense recorded in future periods.

Research and Development Expenses

Research and Development Expenses

Costs incurred for research and development are expensed as incurred. The salaries, benefits, and overhead costs of personnel conducting research and development of the Company’s products are included in research and development expenses. Purchased materials that do not have an alternative future use are also expensed. Purchased materials that have an alternative future are classified as a prepaid expense and periodically reviewed.

Net Loss Per Share

Net Loss Per Share

Basic earnings (loss) per share is computed using the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per share is computed using the weighted-average number of common shares and the dilutive effect of contingent shares outstanding during the period. Potentially dilutive contingent shares, which primarily consist of stock issuable upon exercise of stock options and warrants, and the conversion of Series L Preferred Stock, have been excluded from the diluted loss per share calculation because their effect is anti-dilutive.

During the year ended December 31, 2025, the Company recorded dividends on Series L Preferred Stock of $320,000, and a deemed dividend of $5,775,000 related to the change in fair value resulting from the anti-dilution adjustment of Greenshoe Rights liability, Common and Vesting Warrants. These amounts have been deducted from net income to arrive at net income attributable to common stockholders for the purpose of calculating basic and diluted earnings per share

The following common stock equivalents were excluded in the computation of the net loss per share because their effect is anti-dilutive:

Schedule of Anti-dilutive Securities

	December 31, 2025		December 31, 2024
Series L Preferred Stock ¹		6,847,354		—
Options to purchase common stock		597,550		124,600
Warrants to purchase common stock		50,532,927		1,120,429
Total anti-dilutive securities		57,977,831		1,245,029

Convertible into common stock using a conversion price of $0.5319 per share, as of December 31, 2025.

Concentration

Concentration

Cash is deposited in one financial institution. The balances held at this financial institution at times may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits of up to $250,000. Management believes that the financial institutions that hold the Company’s cash are financially sound and, accordingly, minimal credit risk exists.

The Company has a significant concentration of expenses incurred from and accounts payable to Cytovance and the University of Minnesota, see Note 3 – Accounts Payable.

Segment Information

Segment Information

The Company’s Chief Executive Officer and President (“CEO”) is our chief operating decision maker (“CODM”) and evaluates performance and makes operating decisions about allocating resources based on financial data presented on a consolidated basis. Because our CODM evaluates financial performance on a consolidated basis, the Company has determined that it operates as a single reportable segment composed of the financial results of GT Biopharma, Inc. (see Note 8 – Segment Information).

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.

The Company’s management has evaluated all the recently issued, but not yet effective, accounting standards and guidance that have been issued or proposed by the FASB or other standards-setting bodies through the filing date of these financial statements and does not believe the future adoption of any such pronouncements will have a material effect on the Company’s financial position and results of operations.