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What changed in Ainos, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Ainos, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+257 added−324 removedSource: 10-K (2026-03-30) vs 10-K (2024-12-31)

Top changes in Ainos, Inc.'s 2025 10-K

257 paragraphs added · 324 removed · 126 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe believe VELDONA has shown to be safe and effective in the clinical studies for treatment of intended human and animal diseases. Since our inception to date, 68 human clinical trials have been conducted with low-dose oral IFNα. 63 studies were Phase 2 trials, and 3 Phase 1 and 2 Phase 3 studies have also been conducted.
Biggest changeSince our inception, we have conducted research and development of low-dose oral interferon across human and animal health applications. To date, we have completed 68 human clinical studies evaluating low-dose oral interferon alpha, including Phase 1, Phase 2, and Phase 3 studies. Of these, 63 were Phase 2 trials that evaluated safety, tolerability, and potential therapeutic effects across multiple indications.
Regulation of Veterinary Drugs in Taiwan Our veterinary product candidates are subject laws and regulations in Taiwan including, but not limited to, the Veterinary Drugs Control Act, Enforcement Rules under the Veterinary Control Act, Guidelines of Good Manufacture Practice for Veterinary Drug Manufacturers, and Taiwan Regulations for Pet Foods and Supplements.
Our VELDONA veterinary product candidates are subject laws and regulations in Taiwan including, but not limited to, the Veterinary Drugs Control Act, Enforcement Rules under the Veterinary Control Act, Guidelines of Good Manufacture Practice for Veterinary Drug Manufacturers, and Taiwan Regulations for Pet Foods and Supplements.
Majority of our employees are in Taiwan. None of our employees are represented by a labor union or are a party to a collective bargaining agreement. We plan to continue expand our manpower in research development, sales and marketing, and general operations to support our business programs.
Most of our employees are based in Taiwan. None of our employees are represented by a labor union or are party to a collective bargaining agreement. We plan to continue to expand our workforce in research and development, sales and marketing, and general operations to support our business programs.
Please refer to Part 3 Item 10 and 11 for executive profile and compensation. Additional Information Under our former name, Amarillo Biosciences, Inc., we completed an initial public offering on the Nasdaq SmallCap Market in August 1996 and have traded on the U.S. over-the-counter market since October 1999.
Additional Information Under our former name, Amarillo Biosciences, Inc., we completed an initial public offering on the Nasdaq SmallCap Market in August 1996 and have traded on the U.S. over-the-counter market since October 1999. On October 31, 2013, we filed a voluntary petition for reorganization under Chapter 11 of the United States bankruptcy code.
We renamed as Ainos, Inc in April 2021. 6 On August 9, 2022, our common stock and warrants began trading on the Nasdaq Capital Market under the trading symbols “AIMD” and “AIMDW,” respectively. We effectuated a 1-for-15 reverse stock split of our common stock on August 8, 2022, and a 1-for-5 reverse stock split on December 14, 2023.
We emerged from bankruptcy on January 23, 2015. We established a Taiwan branch office in 2017. We renamed as Ainos, Inc in April 2021. On August 9, 2022, our common stock and warrants began trading on the Nasdaq Capital Market under the trading symbols “AIMD” and “AIMDW,” respectively.
FDA) has granted orphan drug designation for our VELDONA formulation as a potential treatment for oral warts in HIV-seropositive patients. We have completed Phase 2 studies for these programs. Within the human drug pipeline, we are prioritizing treatments for HIV oral warts and Sjögren’s syndrome.
Our current VELDONA® development programs focus on selected rare, autoimmune, and infectious disease indications. These include candidates for the treatment of oral warts in HIV-seropositive patients, Sjögren’s syndrome, and feline chronic gingivostomatitis (“FCGS”). The U.S. Food and Drug Administration has granted orphan drug designation for our VELDONA® formulation as a potential treatment for oral warts in HIV-seropositive patients.
We believe our outsourced manufacturing strategy potentially saves us the time and resources required to establish our own infrastructure. We outsource manufacturing of our POCT product candidates to TCNT. We outsource manufacturing of VELDONA drugs for human-use to Swiss Pharmaceutical Co., Ltd., a Taiwan-based company. We outsource manufacturing of VELDONA Pet supplements to a Taiwan-based third party and to TCNT.
We outsource the manufacturing of our AI Nose hardware products and point-of-care testing (POCT) product candidates to Taiwan Carbon Nano Technology Corp. (TCNT). We outsource the manufacturing of our VELDONA® human-use drug candidates to Swiss Pharmaceutical Co., Ltd., a Taiwan-based pharmaceutical manufacturer. We outsource the manufacturing of our VELDONA® pet supplement products to third-party manufacturers in Taiwan, including TCNT.
Building on our research and development on VELDONA since inception, we are focused on commercializing a suite of VELDONA-based product candidates. Our priority pipeline includes drug candidates for treating oral warts for human immunodeficiency virus (HIV) seropositive patients, Sjögren’s syndrome, and feline chronic gingivostomatitis (FCGS), a cat oral infection.
Our VELDONA® programs include candidates for the treatment of oral warts in HIV-positive patients, Sjögren’s syndrome, and feline chronic gingivostomatitis (“FCGS”). We have conducted research and development activities related to VELDONA® since our inception.
We believe Taiwan has been a key center of the global technology supply chain and it is also home to high-caliber engineers, scientists and healthcare professionals. We believe maintaining operations in Taiwan, at least in the near-term, allows us to access high-caliber talent while staying cost effective, enabling us to develop high quality, affordable, consumer-friendly products. Outsourced Manufacturing.
We also believe that maintaining operations in Taiwan in the near term enables us to access technical and scientific talent while managing operating costs, supporting the development of high-quality and cost-effective products. Outsourced Manufacturing. We rely on an outsourced manufacturing model, which we believe allows us to manage capital efficiently and maintain operational flexibility.
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ITEM 1. BUSINESS. Overview Ainos, Inc. (the “Company”), incorporated in the State of Texas in 1984, is a diversified healthcare company focused on the development of novel point-of-care testing (the “POCT”), therapeutics based on very low-dose interferon alpha (the “VELDONA”), and synthetic RNA-driven preventative medicine.
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ITEM 1. BUSINESS. Overview Ainos, Inc. (the “Company”), incorporated in the State of Texas in 1984, is a dual-platform company advancing artificial intelligence–based smelltech technologies and immune therapeutics. Our primary strategic focus is the commercialization of our proprietary scent digitization platform, AI Nose, while we also continue to develop therapeutic assets based on our low-dose oral interferon program, VELDONA®.
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Our product pipeline includes commercial-stage VELDONA Pet supplements, clinical-stage VELDONA human therapeutics and telehealth-friendly POCTs powered by the AI Nose technology platform. Our vision for AI Nose is to digitize smell, extend application beyond healthcare, and ultimately become AI’s nose. We have historically involved in the research and development of therapeutics based on VELDONA.
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Our core technology platform, AI Nose, is an AI-based electronic olfaction system that integrates gas sensor arrays with proprietary artificial intelligence models, which we refer to as a smell language model (“SLM”), to digitize scent and volatile organic compound (“VOC”) signals into Smell ID, a machine-readable data format. AI Nose is initially developed in healthcare-related settings, including point-of-care testing (“POCT”).
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In 2021 and 2022, we acquired certain types of intellectual property from a controlling shareholder, Ainos Inc., a Cayman Island corporation (“Ainos KY”), to expand product portfolio into POCTs aimed to provide connected, rapid, and convenient testing for a broad range of health conditions.
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These early healthcare applications shaped the platform’s sensor architecture, data models, and system calibration. Building on this foundation, we are expanding the application of AI Nose into industrial environments, where we believe real-time environmental sensing, anomaly detection, and operational monitoring are important. Current and planned use cases include industrial applications across semiconductor manufacturing, robotics, and smart manufacturing settings.
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Pivoting from the sales of COVID-19 POCT, we aim to commercialize POCTs that detect volatile organic compounds (the “VOC”) emitted by the body, powered by our AI Nose technology platform.
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We believe the underlying scent digitization architecture of AI Nose is adaptable across a range of industrial and non-industrial verticals, and we continue to evaluate additional application opportunities based on partner engagement and deployment experience. 3 We are advancing the AI Nose platform through partner-led deployments, with a strategy focused on platform scalability, data-driven performance improvement, and integration into existing industrial ecosystems.
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In 2024, we licensed certain patents and patent applications from Taiwan Carbon Nano Technology Corporation (“TCNT”), a controlling shareholder, to further expand our intellectual properties on our VOC and POCT technologies. 3 We believe the following attributes differentiate us from other diversified life science companies: - intuitive, telehealth-friendly point-of-care testing - AI-powered VOC testing platform - decades of proprietary low-dose oral interferon clinical research - capital-efficient business model - outsourced manufacturing - global distribution relationships Our Technologies VELDONA Interferons are proteins made by host cells in response to the presence of pathogens.
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Our approach emphasizes expanding the role of scent as a machine-readable data modality alongside vision and sound, while maintaining flexibility to address diverse operational requirements. Separately, we continue to develop VELDONA®, our low-dose oral interferon platform, targeting selected rare, autoimmune, and infectious disease indications.
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Interferons allow for communication between cells to trigger the protective defenses of the immune system. VELDONA formulation, delivered into the oral cavity as a lozenge in low doses, is designed to enhance autoimmunity to resist virus damages, potentially reducing side effects and risks caused by high-dose interferon and other small molecule drugs.
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Our Technologies AI Nose Platform (AI-Powered Scent Digitization SmellTech) AI Nose is our core artificial intelligence–based scent digitization SmellTech platform designed to enable machines to detect, classify, and interpret scent and volatile organic compound (“VOC”) signals in real time.
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In 28 studies performed by Ainos, VELDONA was found to exhibit systemic effects in mice, cats, dogs, ferrets, chickens, rats, guinea pigs, horses, calves/cows, and particularly pigs. VELDONA aided in boosting feed conversion efficiency and fighting deadly viral infections in these species, including canine parvovirus, equine herpesvirus, feline coronavirus, and others.
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While artificial intelligence has broadly adopted vision and sound as primary data modalities, smell remains a largely underrepresented perception layer for machines. We are developing AI Nose to address this gap by translating complex scent signals into a structured, machine-readable data format.
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We believe the studies demonstrate VELDONA’s therapeutic or preventive effect via the oral mucosa and shows VELDONA modulates systemic and mucosal immunity without serious side effects. We are developing VELDONA for a broad range of human and animal health conditions.
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Our targeted revenue sources include sales of AI Nose hardware systems and recurring service-based offerings associated with our SmellTech platform. AI Nose differs from conventional gas sensors in that it is positioned as a connected, trainable SmellTech sensing platform rather than a single-purpose detection component.
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Our planned drug pipeline includes: oral warts for HIV-seropositive patients, Sjogren’s Syndrome, mid COVID-19 syndromes, common cold, influenza, aphthous stomatitis, chemotherapy-induced stomatitis and FCGS. Our priorities are HIV-seropositive patients, Sjogren’s Syndrome and FCGS. The United States Food and Drug Administration (the “U.S.
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The system combines portable sensor hardware capable of parts-per-billion–level sensitivity with cloud connectivity and proprietary artificial intelligence models. This architecture enables centralized data aggregation, remote model updates, and performance refinement over time. Unlike fixed-function sensors calibrated for specific compounds, AI Nose is designed to support ongoing training and adaptation as additional scent data are collected across deployments.
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FDA”) have granted Orphan Drug Designation (“ODD”) for our VELDONA formulation as a potential treatment for oral warts in HIV-seropositive patients. We marketed a series of health supplements for dogs and cats under the brand name “VELDONA Pet” in Taiwan in 2024.
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The AI Nose platform integrates gas sensor arrays with our proprietary artificial intelligence models, which we refer to as smell language model (“SLM”), to digitize scent signals into Smell ID, a structured digital data format designed to support computational analysis, comparison, and learning across applications and environments.
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Point-of-Care Tests (POCTs) Our POCT technologies aim to provide a simple, effective and telehealth-friendly tests that can deliver results within minutes. Our POCT detection technologies consists of VOC sensing, lateral flow immunochromatographic assay and nucleic acid. Currently we prioritize developing products based on VOC sensing.
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The SLM is designed to classify and contextualize scent data and to enable learning across different operating conditions using a trainable data framework. Through continued development of the SLM, we are working to treat scent data as an AI-native data asset that can be applied across multiple use cases and deployment models.
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We intend to evaluate our lateral flow and nucleic acid test technologies for potential applications for other disease indication. VOC Sensing Powered by AI Nose We believe the analysis of VOC is a powerful, non-invasive option for disease detection and health monitoring. Our VOC sensing technology aims to detect the target VOCs within few minutes.
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AI Nose was initially developed in healthcare-related environments, including point-of-care testing (“POCT”) and healthcare monitoring use cases such as ventilator-associated pneumonia, women’s vaginal health, and selected sexually transmitted infections. These early applications required reliable operation in variable clinical settings and influenced the design of the platform’s sensor architecture, signal processing pipeline, data labeling methodology, and model training framework.
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AI Nose, the key enabler of our VOC sensing, consists of three key technologies: 1) a “digital nose” detects the target VOCs; 2) a trained artificial intelligence (“AI”) algorithm analyzes the target VOCs; 3) a “Smell ID” stores the VOC’s digital profile in the cloud.
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Development in healthcare settings also contributed to calibration, quality control, and validation processes that are applicable across other operating environments. Based on this foundation, AI Nose is designed to detect and analyze target VOC patterns with parts-per-billion sensitivity within short time frames, supporting non-invasive and timely monitoring applications.
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We believe VOC sensing powered by AI Nose is scalable into a broad range of industries for two reasons. First, digital nose sensors can be made small and at low cost through semiconductor manufacturing technology. Second, as we train our AI with more Smell IDs, our VOC sensing can continue to improve.
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Building on this healthcare foundation, we have expanded the application of AI Nose into industrial environments, where continuous environmental sensing, anomaly detection, and operational monitoring are important. Current and targeted industrial applications include deployments across semiconductor manufacturing, robotics, and smart manufacturing settings.
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While health testing is our near-term focus, we believe we can broaden VOC sensing powered by AI Nose to other applications including telehealth, automotive, industrial, and environmental safety. To address these additional opportunities, we are codeveloping a VOC POCT solution for the elderly care market.
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In these environments, AI Nose is designed to function as a modular sensing component supporting safety-related detection, process awareness, and environmental monitoring. 4 During 2025, we expanded the AI Nose industrial ecosystem through collaborations supporting pilot deployments.
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We are also codeveloping a VOC sensing solution to address the industrial market, as our first move to expand the application of AI Nose beyond healthcare.
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These deployments generate real-world scent data across diverse operating conditions, which we use to refine models, improve classification performance, and broaden the range of detectable patterns. We believe this process creates a data-driven feedback loop, whereby increased deployment generates additional Smell ID data that supports ongoing model improvement and broader applicability of the platform.
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Our vision is to leverage digital nose sensors and our proprietary VOC sensing AI algorithm, to digitize smell and ultimately become AI’s nose. 4 Our Pipeline An integral part of our operating strategy is to create multiple revenue streams through sales of commercially ready products, out-licensing or forming strategic relationships to develop and commercialize our products.
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As part of our industrial commercialization efforts, in 2025 we secured an initial commercial deployment under a multi-year subscription agreement with a leading semiconductor packaging and testing company involving AI Nose within manufacturing environments.
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As of December 31, 2024, we have commercialized the following products: ● COVID-19 Antigen Rapid Test Kit . Our first commercialized product line was COVID-19 antigen rapid test kits marketed in Taiwan under emergency use authorization (EUA) issued by the Taiwan Food and Drug Administration (TFDA) to TCNT, the product manufacturer.
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In addition to industrial applications, we continue to evaluate healthcare-adjacent use cases, including senior care, women’s vaginal health, selected sexually transmitted infections, and environmental control and monitoring in hospital operations, where non-invasive and continuous sensing capabilities may support monitoring and safety-related applications. To support the continued development and scaling of the AI Nose platform, we operate ScentAI Inc.
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We discontinued selling this product in the first quarter of 2024. ● VELDONA Pet supplement. VELDONA Pet is formulated to address a variety of health issues in dogs and cats, including skin, gum, emotion, discomfort caused by allergies, eye, and weight-related issues. We launched VELDONA Pet supplement in Taiwan in the second quarter of 2023.
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(“ScentAI”), a wholly owned subsidiary focused on advancing the SLM algorithm, with Ainos focusing on hardware, deployment, and data generation. Point-of-Care Testing (POCT) Our point-of-care testing (“POCT”) development activities incorporate multiple detection approaches, including volatile organic compound (“VOC”) sensing, lateral flow immunochromatographic assays, and nucleic acid–based methods.
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From time to time, we assess our development plan based on available resources and market dynamics. Our pipeline of the products, which are under development, includes the following: ● VELDONA human and animal drugs. Our human drug pipeline includes treatments for oral warts in HIV-seropositive patients, Sjögren’s syndrome, common cold, and influenza. The United States Food and Drug Administration (U.S.
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Current POCT development efforts emphasize applications that leverage VOC sensing capabilities derived from the AI Nose platform. While initially developed for ventilator-associated pneumonia, our planned POCT pipeline also includes applications in senior care hygiene monitoring, women’s vaginal health, and selected sexually transmitted infections.
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As of December 31, 2024, we were in the process of initiating clinical studies for HIV oral warts and Sjögren’s syndrome in Taiwan. In 2024, we also initiated a clinical study for FCGS to explore further opportunities for VELDONA in the animal drug market. ● VOC POCT – Ainos Flora.
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We continue to evaluate lateral flow and nucleic acid technologies for selected disease indications as part of our broader technology portfolio. VELDONA® (Low-Dose Oral Interferon Platform) VELDONA® is our low-dose oral interferon alpha formulation delivered to the oral cavity and designed to modulate immune responses through the oral mucosa.
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Ainos Flora, powered by AI Nose technology, is designed to offer a quick, non-invasive test for female vaginal health and common STIs. We are also developing a companion app for managing test results. We aim to provide fast, private, and convenient testing at the point of care.
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Interferons are naturally occurring proteins produced by host cells in response to pathogens and play a role in immune signaling. The VELDONA® formulation is intended to enable immune modulation at low doses, with the objective of reducing the risks and side effects commonly associated with higher-dose interferon therapies.
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To enhance at-home testing, we are developing a second generation Ainos Flora device with CUDA technology. We are conducting clinical studies in Taiwan, and we are also exploring commercialization opportunities. ● VOC platform – NISD co-development. We are collaborating with Nisshinbo Micro Devices Inc. (“NISD”) and Taiwan Inabata Sangyo Co.
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In addition, we have conducted 28 preclinical and animal studies evaluating low-dose oral interferon across a range of species. These studies assessed immune-related effects and explored potential applications in both companion and production animals. Results from these studies shaped our understanding of oral mucosal delivery and systemic immune modulation.
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(“Taiwan Inabata”) to develop a VOC sensing platform based on AI Nose. This platform is designed for applications in telehealth, automotive, industrial, and environmental safety sectors. We are co-developing a VOC POCT solution for elderly care and a VOC sensing solution for industrial use. ● VOC POCT – Ainos Pen.
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We are advancing clinical studies in Taiwan to further evaluate VELDONA® in HIV-seropositive patients, Sjögren’s syndrome, and FCGS indications, subject to enrollment progress. We intend to primarily pursue out-licensing and partnership opportunities to advance the further development and commercialization of the VELDONA® assets.
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The device is intended to be a cloud-connected, multi-purpose, portable breath analyzer that is intended to monitor health conditions within minutes, powered by AI Nose. We expect consumers to be empowered to share test results with their physicians through in-person and telehealth medical consultations. ● VOC POCT – CHS430.
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In parallel, we commercialized VELDONA® Pet supplements in Taiwan to support companion animal health. 5 Product Portfolio and Pipeline An integral part of our operating strategy is to advance commercially viable products while expanding the deployment of the AI Nose platform through partnerships and system integrations. ● AI Nose platform deployments for industrial applications, including semiconductor manufacturing, robotics, and smart manufacturing, delivered through partner-led commercialization efforts. ● Selected POCT devices under development powered by AI Nose, designed for healthcare applications including senior care, women’s vaginal health and certain common STIs. ● VELDONA® Pet supplements, launched in Taiwan. ● VELDONA® human and animal drug candidates, targeting oral warts in HIV-seropositive patients, Sjögren’s syndrome, and FCGS, currently under clinical study in Taiwan.
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The CHS430 device, powered by AI Nose, is intended to provide non-invasive testing for ventilator-associated pneumonia within few minutes, as compared to current standard of care invasive culture tests that typically take more than two days to provide results. ● Synthetic RNA (“SRNA”) .
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From time to time, we evaluate our development priorities based on available resources, partner engagement, and market conditions. Our current focus emphasizes scaling the AI Nose platform and expanding its commercial footprint across industrial and infrastructure-oriented environments, while continuing to advance selected healthcare and therapeutic programs.
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We plan develop a SRNA technology platform in Taiwan with a long-term goal of developing next-generating precision treatments and rapid tests. 5 Our Business Model We believe our business model is capital efficient based on the following: Operation in Taiwan. We have constructed our operation to be capital efficient by choosing Taiwan as our R&D and operating center.
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Our Business Model We structure our operations to emphasize capital efficiency through a combination of geographic footprint, outsourced manufacturing, and third-party commercial relationships, as described below. Geographic footprint. We operate our research and development and certain operating functions primarily in Taiwan as part of a capital-efficient operating model.
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Distribution Relationships. We work with distributors to sell products. We appointed Inabata & Co. Ltd. (“Inabata”), a Japanese corporation, as our non-exclusive worldwide distributor and preferred distributor for customers based in Japan. Inabata’s Taiwan subsidiary (Taiwan Inabata Sangyo Co.) coordinates business logistics and working capital for our designated programs. Topmed International Biotech Co., Ltd.
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Taiwan is a significant hub in the global technology supply chain and offers access to a skilled workforce, including engineers, researchers, and healthcare professionals. We believe our presence in Taiwan supports our current commercialization activities by enabling close coordination with manufacturing partners, distributors, and customers in the region.
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(“Topmed”), a Taiwanese biotech company, is a distributor of our VELDDONA Pet supplements in Taiwan. Intellectual Property We own a portfolio of patents covering various aspects of our core technologies. As of December 31, 2024, we had sixty-five (65) issued patents and nineteen (19) pending patent applications.
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Commercial Relationships. We work with third parties to support the commercialization of our products across different markets and applications. We maintain relationships with companies including Inabata & Co. Ltd. and its Taiwan subsidiary, Taiwan Inabata Sangyo Co., Topco Scientific Co., Ltd., Trusval Technology Co., Ltd., Solomon Technology Corporation, Kenmec Mechanical Engineering Co., Ltd., and Topmed International Biotech Co., Ltd.
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Fifty-seven (57) of the issued patents relate to acquired VOC and POCT technologies, five (5) relate to interferon technologies and three (3) relate to our smart drug injection technology. Fifty-six (56) of the issued patents are foreign patents and nine (9) are U.S. patents. Eleven (11) issued patents are licensed patents.
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Intellectual Property We seek to protect our technology and competitive position through a combination of patents, trade secrets, proprietary know-how, and other intellectual property rights. Our intellectual property portfolio includes issued patents and pending patent applications covering aspects of our core technologies, including AI Nose sensing technologies, point-of-care testing, and interferon-based therapeutics.
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Of the issued patents, forty-three (43) are invention patents, fourteen (14) are utility model patents and eight (8) are design patents. Of our issued patents, five (5) shall expire between 2026 and 2029; twenty-two (22) between 2030 and 2034, thirty-eight (38) between 2035 and 2046.
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The issued patents within our portfolio have expiration dates ranging from 2026 through 2046, depending on jurisdiction and the specific patent grant. We also rely on contractual protections, including confidentiality and non-disclosure agreements with employees, collaborators, and other third parties, to safeguard proprietary information.
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We also have exclusive use of twenty three (23) patents and patent applications related to VOC, POCT and nitrogen-oxygen separation technologies for twelve months from October 16, 2024, pursuant to Product Development Agreement, effective August 1, 2021, as amended on January 9, 2024, July 8, 2024, and October 16, 2024, with TCNT. Please refer to “Part III, Item 13”.
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We continue to evaluate opportunities to expand and strengthen our intellectual property portfolio as our technologies evolve.
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We own a registered trademark for VELDONA in Taiwan, Europe, Japan and China, as well as certain trademarks for our VELDONA Pet supplement in Taiwan. We have trademark applications for certain countries outside of Taiwan. Employees As of December 31, 2024, we had 44 full-time employees, of which 23 are in research and development.
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We also license certain patents and patent applications related to AI Nose, point-of-care testing and other technologies pursuant to certain agreements with our affiliated companies as disclosed in Part III, Item 13. 6 Employees As of December 31, 2025, we had 41 full-time employees, of whom 20 were engaged in research and development.
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On October 31, 2013, we filed a voluntary petition for reorganization under Chapter 11 of the United States bankruptcy code. We emerged from bankruptcy on January 23, 2015. We established a Taiwan branch office in 2017.
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We effectuated a 1-for-15 reverse stock split of our common stock on August 8, 2022, and a 1-for-5 reverse stock split on December 14, 2023, and a 1-for-5 reverse stock split on June 30, 2025.
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Government Regulation Regulation of Medical Devices in Taiwan Our product candidates and operations are subject to the Taiwan Medical Devices Act and its implementation regulations (collectively the “ Taiwan MDA ”), which govern the development, design, pre-clinical and clinical research, manufacturing, safety, efficacy, labeling, packaging, storage, installation, servicing, recordkeeping, premarket clearance or approval, import, export, adverse event reporting, advertising, promotion, marketing and distribution of medical devices.
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Government Regulation Our AI Nose platform products incorporate electronic components and may include wireless communication capabilities, which may subject them to regulatory requirements governing radio frequency emissions, electromagnetic compatibility, and wireless device certification in jurisdictions where they are manufactured, marketed, or operated. In the United States, such devices are regulated by the Federal Communications Commission (“FCC”).
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Under the Taiwan MDA, medical devices, depending on the degree of risk associated with each medical device and the extent of manufacturer and regulatory control needed to provide reasonable assurance of its safety and effectiveness, will be subject to differentiated level of review and examination of TFDA before marketing the device.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

79 edited+47 added−21 removed250 unchanged
Biggest changeEven if our agreements with current or future collaborators entitle us to indemnification against losses, such indemnification may not be available or adequate should any claim arise. 24 Any disruption in our research and development facility could adversely affect our business, financial condition and results of operations. Our facility may be affected by natural or man-made disasters.
Biggest changeAny disruption in our research and development facility could adversely affect our business, financial condition and results of operations. Our facility may be affected by natural or man-made disasters. We are vulnerable to damage from other types of disasters, including power loss, attacks from extremist organizations, fires, floods, and similar events.
If we are unable to expand sales and marketing capabilities on our own or through third parties, or are delayed in establishing these capabilities, we will be unable to successfully commercialize our product candidates, if approved, or generate product revenue. We currently have limited marketing capabilities.
We currently have limited marketing capabilities. If we are unable to expand sales and marketing capabilities on our own or through third parties, or are delayed in establishing these capabilities, we will be unable to successfully commercialize our product candidates, if approved, or generate product revenue. We currently have limited marketing capabilities.
These fluctuations may occur due to a variety of factors, many of which are outside of our control and may be difficult to predict, including: ● the scalability of our product sales, which is difficult to predict ● the timing and cost of, and level of investment in, research, development and commercialization activities, which may change from time to time; ● the timing and status of enrollment for our clinical trials; ● the timing of regulatory approvals, if any, in the United States and internationally; ● the timing of expanding our operational, financial and management systems and personnel, including personnel to support our clinical development, quality control, manufacturing and commercialization efforts and our operations as a public company; ● the cost of manufacturing, as well as building out our supply chain, which may vary depending on the quantity produced, and the terms of any agreements we enter into with third-party suppliers; ● the timing and amount of any milestone, royalty or other payments due under any current or future collaboration or license agreement; ● coverage and reimbursement policies with respect to any future approved products, and potential future drugs that compete with our products; ● the timing and cost to establish a sales, marketing, medical affairs and distribution infrastructure to commercialize any products for which we may obtain marketing approval and intend to commercialize on our own or jointly with current or future collaborators; ● expenditures that we may incur to acquire, develop or commercialize additional products and technologies; ● the level of demand for any future approved products, which may vary significantly over time; ● future accounting pronouncements or changes in accounting principles or our accounting policies; and ● the timing and success or failure of nonclinical studies and clinical trials for our product candidates or competing product candidates, or any other change in the competitive landscape of our industry, including consolidation among our competitors or collaboration partners.
These fluctuations may occur due to a variety of factors, many of which are outside of our control and may be difficult to predict, including: ● the scalability of our product sales, which is difficult to predict ● the timing and cost of, and level of investment in, research, development and commercialization activities, which may change from time to time; 10 ● the timing and status of enrollment for our clinical trials; ● the timing of regulatory approvals, if any, in the United States and internationally; ● the timing of expanding our operational, financial and management systems and personnel, including personnel to support our clinical development, quality control, manufacturing and commercialization efforts and our operations as a public company; ● the cost of manufacturing, as well as building out our supply chain, which may vary depending on the quantity produced, and the terms of any agreements we enter into with third-party suppliers; ● the timing and amount of any milestone, royalty or other payments due under any current or future collaboration or license agreement; ● coverage and reimbursement policies with respect to any future approved products, and potential future drugs that compete with our products; ● the timing and cost to establish a sales, marketing, medical affairs and distribution infrastructure to commercialize any products for which we may obtain marketing approval and intend to commercialize on our own or jointly with current or future collaborators; ● expenditures that we may incur to acquire, develop or commercialize additional products and technologies; ● the level of demand for any future approved products, which may vary significantly over time; ● future accounting pronouncements or changes in accounting principles or our accounting policies; and ● the timing and success or failure of nonclinical studies and clinical trials for our product candidates or competing product candidates, or any other change in the competitive landscape of our industry, including consolidation among our competitors or collaboration partners.
Regardless of the merits or eventual outcome, liability claims may result in: ● decreased demand for any approved product; ● injury to our reputation; ● withdrawal of clinical trial participants; ● initiation of investigations by regulators; ● costs to defend litigation; ● a diversion of management’s time and our resources; ● substantial monetary payments to trial participants or patients; ● product recalls, withdrawals or labeling, marketing or promotional restrictions; ● loss of revenue; ● exhaustion of any available insurance and our capital resources; ● adverse effects to our results of operations and business; ● the inability to commercialize any product candidate; and ● a decline in our share price.
Regardless of the merits or eventual outcome, liability claims may result in: ● decreased demand for any approved product; ● injury to our reputation; 17 ● withdrawal of clinical trial participants; ● initiation of investigations by regulators; ● costs to defend litigation; ● a diversion of management’s time and our resources; ● substantial monetary payments to trial participants or patients; ● product recalls, withdrawals or labeling, marketing or promotional restrictions; ● loss of revenue; ● exhaustion of any available insurance and our capital resources; ● adverse effects to our results of operations and business; ● the inability to commercialize any product candidate; and ● a decline in our share price.
In other jurisdictions, for instance, in Taiwan, there is a similar risk regarding the acceptability of clinical trial data conducted outside of that jurisdiction. 21 Our long-term prospects depend in part upon discovering, developing and commercializing additional products, including POCT and VELDONA candidates, which may fail in development or suffer delays that adversely affect their commercial viability.
In other jurisdictions, for instance, in Taiwan, there is a similar risk regarding the acceptability of clinical trial data conducted outside of that jurisdiction. Our long-term prospects depend in part upon discovering, developing and commercializing additional products, including POCT and VELDONA candidates, which may fail in development or suffer delays that adversely affect their commercial viability.
Commercialization of our product candidates will be subject to the regulatory requirements governing marketing authorization in the jurisdiction in which they are sold. Approval procedures vary among jurisdictions and can involve requirements and administrative review periods different from, and more onerous than, those in Taiwan and the United States, including additional nonclinical studies or clinical trials.
Commercialization of our product candidates will be subject to the regulatory requirements governing marketing authorization in the jurisdiction in which they are sold. 16 Approval procedures vary among jurisdictions and can involve requirements and administrative review periods different from, and more onerous than, those in Taiwan and the United States, including additional nonclinical studies or clinical trials.
Government authorities and third-party payors, such as private health insurers and health maintenance organizations, and establish reimbursement levels. It is difficult to predict at this time what government authorities and third-party payors may decide with respect to coverage and reimbursement for our programs (if approved). 23 A primary trend in the U.S. healthcare industry and elsewhere is cost containment.
Government authorities and third-party payors, such as private health insurers and health maintenance organizations, and establish reimbursement levels. It is difficult to predict at this time what government authorities and third-party payors may decide with respect to coverage and reimbursement for our programs (if approved). A primary trend in the U.S. healthcare industry and elsewhere is cost containment.
We may also experience numerous unforeseen events prior to, during, or as a result of our nonclinical studies or clinical trials that could delay or prevent our ability to receive marketing approval or commercialize the product candidates we develop, including: ● regulators, Institutional Review Boards (“IRBs”) or ethics committees may not authorize us to conduct the clinical study; ● we may experience delays due to challenges with third-party contractors and contract research organizations (“CROs”), including negotiating agreement terms, compliance with regulatory requirements, compliance with clinical trial protocols; ● it may be difficult to enroll a sufficient number of suitable patients, or enrollment may be slower than we anticipate or participants may drop out of these clinical trials or fail to return for post-treatment follow-up at a higher rate than we anticipate; ● the supply or quality of materials for product candidates we develop or other materials necessary to conduct clinical trials may be insufficient or inadequate; and ● we may experience disruptions by man-made or natural disasters or public health pandemics or epidemics or other business interruptions, including any future significant outbreaks of diseases similar to the COVID-19 pandemic.
We may also experience numerous unforeseen events prior to, during, or as a result of our nonclinical studies or clinical trials that could delay or prevent our ability to receive marketing approval or commercialize the POCT and VELDONA candidates we develop, including: ● regulators, Institutional Review Boards (“IRBs”) or ethics committees may not authorize us to conduct the clinical study; ● we may experience delays due to challenges with third-party contractors and contract research organizations (“CROs”), including negotiating agreement terms, compliance with regulatory requirements, compliance with clinical trial protocols; ● it may be difficult to enroll a sufficient number of suitable patients, or enrollment may be slower than we anticipate or participants may drop out of these clinical trials or fail to return for post-treatment follow-up at a higher rate than we anticipate; ● the supply or quality of materials for POCT and VELDONA candidates we develop or other materials necessary to conduct clinical trials may be insufficient or inadequate; and ● we may experience disruptions by man-made or natural disasters or public health pandemics or epidemics or other business interruptions, including any future significant outbreaks of diseases similar to the COVID-19 pandemic.
Even if we are able to generate revenues from the sale of any approved product candidates, we may not become profitable and may need to obtain additional funding to continue operations. 17 Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis.
Even if we are able to generate revenues from the sale of any approved product candidates, we may not become profitable and may need to obtain additional funding to continue operations. Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis.
Any decreased use of our products or limitation on our ability to export or sell access to our products would likely adversely affect our business. 36 An active trading market for our common stock may not develop and the market price of our common stock and warrants could be volatile.
Any decreased use of our products or limitation on our ability to export or sell access to our products would likely adversely affect our business. An active trading market for our common stock may not develop, and the market price of our common stock and warrants could be volatile.
The success of our current and future product candidates will depend on many factors, which may include the following: ● sufficiency of our financial and other resources to complete the necessary nonclinical studies and clinical trials, and our ability to raise any additional required capital on acceptable terms, or at all; ● the timely and successful completion of our nonclinical studies and clinical trials for which the TFDA, FDA, or any comparable foreign regulatory authority, agree with the design, endpoints, or implementation; ● receipt of regulatory approvals or authorizations to conduct future clinical trials or other studies beyond those planned to support approval of our product candidates; ● successful enrollment and completion of clinical trials; ● successful data from our clinical program that supports an acceptable risk-benefit profile of our product candidates in the intended populations; ● timely receipt and maintenance of marketing approvals from applicable regulatory authorities; ● establishing, scaling up and scaling out, either alone or with third-party manufacturers, cGMP (Current Good Manufacturing Practice) compliant manufacturing capabilities of clinical supply for our clinical trials and commercial manufacturing (including licensure), if any of our product candidates are approved; ● entry into collaborations to further the development of our product candidates in select indications or geographies; ● obtaining and maintaining regulatory exclusivity for our product candidates as well as establishing competitive positioning amongst other therapies; and ● successfully launching commercial sales of our product candidates and obtaining and maintaining healthcare coverage and reimbursement from third party payors, if approved.
The success of our current and future POCT and VELDONA candidates will depend on many factors, which may include the following: ● sufficiency of our financial and other resources to complete the necessary nonclinical studies and clinical trials, and our ability to raise any additional required capital on acceptable terms, or at all; ● the timely and successful completion of our nonclinical studies and clinical trials for which the TFDA, FDA, or any comparable foreign regulatory authority, agree with the design, endpoints, or implementation; ● receipt of regulatory approvals or authorizations to conduct future clinical trials or other studies beyond those planned to support approval of our POCT and VELDONA candidates; ● successful enrollment and completion of clinical trials; 13 ● successful data from our clinical program that supports an acceptable risk-benefit profile of our POCT and VELDONA candidates in the intended populations; ● timely receipt and maintenance of marketing approvals from applicable regulatory authorities; ● establishing, scaling up and scaling out, either alone or with third-party manufacturers, cGMP (Current Good Manufacturing Practice) compliant manufacturing capabilities of clinical supply for our clinical trials and commercial manufacturing (including licensure), if any of our POCT and VELDONA candidates are approved; ● entry into collaborations to further the development of our POCT and VELDONA candidates in select indications or geographies; ● obtaining and maintaining regulatory exclusivity for our POCT and VELDONA candidates as well as establishing competitive positioning amongst other therapies; and ● successfully launching commercial sales of our POCT and VELDONA candidates and obtaining and maintaining healthcare coverage and reimbursement from third party payors, if approved.
Further, it is possible that domestic or foreign companies, some with greater experience in the pet health and wellness industry or greater financial resources than we possess, will seek to provide products or services that compete directly or indirectly with ours in the future. 33 Many of our competitors may have longer operating histories, greater brand recognition, larger fulfillment infrastructures, greater technical capabilities, significantly greater financial, marketing and other resources and larger customer bases than we do.
Further, it is possible that domestic or foreign companies, some with greater experience in the pet health and wellness industry or greater financial resources than we possess, will seek to provide products or services that compete directly or indirectly with ours in the future. 28 Many of our competitors may have longer operating histories, greater brand recognition, larger fulfillment infrastructures, greater technical capabilities, significantly greater financial, marketing and other resources and larger customer bases than we do.
We may not be able to obtain these licenses on acceptable or commercially reasonable terms, if at all, or these licenses may be non-exclusive, which could result in our competitors using the same intellectual property. 28 We seek to protect our proprietary positions by, among other things, filing patent applications in the United States and in relevant foreign jurisdictions related to our current product candidates and other future product candidates that we may identify.
We may not be able to obtain these licenses on acceptable or commercially reasonable terms, if at all, or these licenses may be non-exclusive, which could result in our competitors using the same intellectual property. 23 We seek to protect our proprietary positions by, among other things, filing patent applications in the United States and in relevant foreign jurisdictions related to our current product candidates and other future product candidates that we may identify.
Even if a current or future product candidate, including POCT and VELDONA, receives marketing approval, it may fail to achieve the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for commercial success.
Even if a current or future product candidate, including AI Nose, POCT and VELDONA, receives marketing approval, it may fail to achieve the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for commercial success.
In addition, we also face intense competition from other companies that develop or already have molecular tests, whether at point-of-care or at-home, as well as companies that have or are developing antigen and antibody tests. 34 To remain competitive, we will need to develop improvements to our products and other offerings.
In addition, we also face intense competition from other companies that develop or already have molecular tests, whether at point-of-care or at-home, as well as companies that have or are developing antigen and antibody tests. 29 To remain competitive, we will need to develop improvements to our products and other offerings.
If we are unable to advance our current or future product candidates through clinical trials, obtain marketing approval and ultimately commercialize any product candidates we develop, or experience significant delays in doing so, our business will be materially harmed. Our product candidates are in different stages of clinical development.
If we are unable to advance our current or future product candidates through clinical trials, obtain marketing approval and ultimately commercialize any product candidates we develop, or experience significant delays in doing so, our business will be materially harmed. Our POCT and VELDONA candidates are in different stages of clinical development.
If we fail to maintain the favorable perception of our brands, our business, financial condition and results of operations could be negatively impacted. 35 Our business, operations, clinical development plans and timelines, and supply chain could be adversely affected by the effects of epidemics , including but not limited to COVID-19.
If we fail to maintain the favorable perception of our brands, our business, financial condition and results of operations could be negatively impacted. 30 Our business, operations, clinical development plans and timelines, and supply chain could be adversely affected by the effects of epidemics , including but not limited to COVID-19.
We have not declared or paid any cash dividends on our capital stock in 2024, and we do not intend to pay any cash dividends in the foreseeable future. Any determination to pay dividends in the future will be at the discretion of our Board of Directors and may be restricted by the terms of any then-current credit facility.
We have not declared or paid any cash dividends on our capital stock in 2025, and we do not intend to pay any cash dividends in the foreseeable future. Any determination to pay dividends in the future will be at the discretion of our Board of Directors and may be restricted by the terms of any then-current credit facility.
Significant clinical trial delays could also allow our competitors to bring products to market before we do, shorten any periods during which we may have the exclusive right to commercialize our product candidates, impair our ability to commercialize our product candidates and harm our business and results of operations.
Significant clinical trial delays could also allow our competitors to bring products to market before we do, shorten any periods during which we may have the exclusive right to commercialize our product candidates, impair our ability to commercialize our POCT and VELDONA candidates and harm our business and results of operations.
These products may compete with our product candidates and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing. 27 We may not have patent rights in certain foreign countries in which a market may exist in the future.
These products may compete with our product candidates and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing. 22 We may not have patent rights in certain foreign countries in which a market may exist in the future.
As a result, our business and results of operations may be materially and adversely affected. 32 Risks related to our business We will need to increase the size of our Company and may not effectively manage our growth. Our success will depend upon growing our business and our employee base.
As a result, our business and results of operations may be materially and adversely affected. 27 Risks related to our business We will need to increase the size of our Company and may not effectively manage our growth. Our success will depend upon growing our business and our employee base.
Any of the foregoing events could harm our business, financial condition, results of operation and prospects. 30 Patent terms may be inadequate to protect our competitive position on our product candidates for an adequate amount of time.
Any of the foregoing events could harm our business, financial condition, results of operation and prospects. 25 Patent terms may be inadequate to protect our competitive position on our product candidates for an adequate amount of time.
Any current or future product candidates, including medical device products, we may develop and the activities associated with their development and commercialization, including their design, testing, manufacture, recordkeeping, labeling, storage, approval, advertising, promotion, sale, and distribution, are subject to comprehensive regulation by the FDA and other regulatory authorities in the United States and by comparable authorities in Taiwan and other countries.
Any current or future POCT and VELDONA candidates, including medical device products, we may develop and the activities associated with their development and commercialization, including their design, testing, manufacture, recordkeeping, labeling, storage, approval, advertising, promotion, sale, and distribution, are subject to comprehensive regulation by the FDA and other regulatory authorities in the United States and by comparable authorities in Taiwan and other countries.
In addition, any delays in completing our clinical trials will likely increase our costs, slow down our product candidate development and approval process and impact our ability to commence product sales and generate revenues.
In addition, any delays in completing our clinical trials will likely increase our costs, slow down our POCT and VELDONA candidate development and approval process and impact our ability to commence product sales and generate revenues.
To obtain the requisite regulatory approvals to commercialize any of our product candidates, we must demonstrate that our products are safe and effective in humans and animals with respect to our veterinary drug candidates. Clinical trials are expensive and can take many years to complete, and their outcomes are inherently uncertain.
To obtain the requisite regulatory approvals to commercialize any of our POCT and VELDONA candidates, we must demonstrate that our products are safe and effective in humans and animals with respect to our veterinary drug candidates. Clinical trials are expensive and can take many years to complete, and their outcomes are inherently uncertain.
Food and Drug Administration, or FDA, and similar foreign regulatory authority laws and regulations. 16 We have generated very little revenue from product sales and may never become profitable.
Food and Drug Administration, or FDA, and similar foreign regulatory authority laws and regulations. 8 We have generated very little revenue from product sales and may never become profitable.
Risks related to reliance on third parties We rely on third parties to manufacture our product and product candidates, and we intend to rely on third parties which increases the risk that we will not have sufficient quantities of such product candidates or products or such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts.
We rely on third parties to manufacture our product and product candidates, and we intend to rely on third parties which increases the risk that we will not have sufficient quantities of such product candidates or products or such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts.
Failure to obtain marketing approval for a product candidate will prevent us from commercializing the product candidate in a given jurisdiction. It is possible that some of our current or future product candidates will not obtain regulatory approval in the jurisdiction we are targeting.
Failure to obtain marketing approval for a product candidate will prevent us from commercializing the product candidate in a given jurisdiction. It is possible that some of our current or future POCT and VELDONA candidates will not obtain regulatory approval in the jurisdiction we are targeting.
The success of our business, including our ability to finance our Company and generate revenue from products in the future will depend heavily on the successful development and eventual commercialization of our product candidates, which may never occur.
The success of our business, including our ability to finance our Company and generate revenue from products in the future, will depend heavily on the successful development and eventual commercialization of our POCT and VELDONA candidates, which may never occur.
If we are not successful with respect to one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to successfully obtain regulatory approval of or commercialize the product candidates we develop, which would materially harm our business.
If we are not successful with respect to one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to successfully obtain regulatory approval of or commercialize the POCT and VELDONA candidates we develop, which would materially harm our business.
Research and development of drug candidates as VELDONA is extremely expensive and complex and its difficult to evaluate the likelihood of the outcome of clinical trials, regulatory approvals, and our business and future prospects.
Research and development of drug candidates such as VELDONA is extremely expensive and complex, and it’s difficult to evaluate the likelihood of the outcome of clinical trials, regulatory approvals, and our business and future prospects.
Accordingly, we cannot provide assurances that we will be able to generate sufficient revenue through the sale of products to continue our business. 20 Clinical product development involves a lengthy and expensive process, with uncertain outcomes.
Accordingly, we cannot provide assurances that we will be able to generate sufficient revenue through the sale of POCT and VELDONA to continue our business. Clinical product development involves a lengthy and expensive process, with uncertain outcomes.
If we do not receive marketing approvals for our current or future product candidates, we may not be able to continue our operations. Even if regulatory approvals are obtained, we may never be able to successfully commercialize any products.
If we do not receive marketing approvals for our current or future POCT and VELDONA candidates, we may not be able to continue our operations. Even if regulatory approvals are obtained, we may never be able to successfully commercialize any products.
Further, if we change an approved manufacturing process, then we may be delayed if the FDA or a comparable foreign authority needs to review the new manufacturing process before it may be used.
We may be delayed if we need to change the manufacturing process used by our manufacturers. Further, if we change an approved manufacturing process, then we may be delayed if the FDA or a comparable foreign authority needs to review the new manufacturing process before it may be used.
Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. generally accepted accounting principles.
Any failure to maintain effective internal control over financial reporting could harm us. Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. generally accepted accounting principles.
Even after a third-party manufacturer has gained significant experience in manufacturing our product and product candidates or even if we believe we have succeeded in optimizing the manufacturing process, there can be no assurance that such manufacturer will produce sufficient quantities for us in a timely manner or continuously over time, or at all. 25 We may be delayed if we need to change the manufacturing process used by our manufacturers.
Even after a third-party manufacturer has gained significant experience in manufacturing our product and product candidates or even if we believe we have succeeded in optimizing the manufacturing process, there can be no assurance that such manufacturer will produce sufficient quantities for us in a timely manner or continuously over time, or at all.
We had cash and cash equivalents of approximately $3.9 million as of December 31, 2024, and we will need to continue to seek capital from time to time to capitalize the development and commercialization of our product candidates and to acquire and develop other product candidates. Our actual capital requirements will depend on many factors.
We had cash and cash equivalents of approximately $417 thousand as of December 31, 2025, and we will need to continue to seek capital from time to time to capitalize the development and commercialization of our product candidates and to acquire and develop other product candidates. Our actual capital requirements will depend on many factors.
If we raise capital through equity financings in the future, that will result in dilution to all other stockholders. We also expect to grant equity awards to employees, directors, and consultants under our 2023 Stock Incentive Plan.
We may need to raise additional capital through equity and debt financings in order to fund our operations. If we raise capital through equity financings in the future, that will result in dilution to all other stockholders. We also expect to grant equity awards to employees, directors, and consultants under our 2023 Stock Incentive Plan.
Our quarterly and annual operating results may fluctuate significantly, which will make it difficult for us to predict our future results.
Our operating results may fluctuate significantly, which will make our future results difficult to predict and could cause our results to fall below expectations. Our quarterly and annual operating results may fluctuate significantly, which will make it difficult for us to predict our future results.
The degree of market acceptance of any product candidate, if approved for commercial sale, will depend on a number of factors, including: ● efficacy and potential advantages compared to alternative tools; ● the ability to offer our products, if approved, for sale at competitive prices; ● convenience and ease of use; ● the willingness of the target market to adopt new technologies; and ● the strength of marketing and distribution support. 22 The total addressable market opportunity for our current and future products may be much smaller than we estimate.
The degree of market acceptance of any product candidate, if approved for commercial sale, will depend on a number of factors, including: ● efficacy and potential advantages compared to alternative tools; ● the ability to offer our products, if approved, for sale at competitive prices; ● convenience and ease of use; ● the willingness of the target market to adopt new technologies; and ● the strength of marketing and distribution support.
Our current product candidates, and any future product candidates we develop, will require additional nonclinical and clinical development, management of clinical, nonclinical and manufacturing activities, marketing approval in the United States and other markets, obtaining sufficient manufacturing supply for both clinical development and commercial production, building of a commercial organization, and substantial investment and significant marketing efforts before we generate any revenues from product sales. 19 As a company, we have limited experience in preparing, submitting and prosecuting regulatory filings.
Our current POCT and VELDONA candidates, and any future POCT and VELDONA candidates we develop, will require additional nonclinical and clinical development, management of clinical, nonclinical and manufacturing activities, marketing approval in the United States and other markets, obtaining sufficient manufacturing supply for both clinical development and commercial production, building of a commercial organization, and substantial investment and significant marketing efforts before we generate any revenues from product sales.
We may not obtain approval for our product candidates in any jurisdictions. Approval of a product candidate in one jurisdiction by a regulatory authority, such as the TFDA or FDA, does not ensure approval of such product candidate by regulatory authorities in other countries or jurisdictions.
Approval of a product candidate in one jurisdiction by a regulatory authority, such as the TFDA or FDA, does not ensure approval of such product candidate by regulatory authorities in other countries or jurisdictions.
If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, financial condition, results of operations, stock price and prospects, including the imposition of significant fines or other sanctions. 26 We may form or seek strategic partnerships in the future, and we may not realize the benefits of such alliances or licensing arrangements.
If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, financial condition, results of operations, stock price and prospects, including the imposition of significant fines or other sanctions.
The trading market for our common stock in the future could be subject to wide fluctuations in response to several factors, including, but not limited to: ● actual or anticipated variations in our results of operations; ● our ability or inability to generate revenues or profit; ● the number of shares in our public float; and ● increased competition.
The trading market for our common stock in the future could be subject to wide fluctuations in response to several factors, including, but not limited to: ● actual or anticipated variations in our results of operations; ● our ability or inability to generate revenues or profit; ● the number of shares in our public float; and ● increased competition. 31 Furthermore, our stock price may be impacted by factors that are unrelated or disproportionate to our operating performance.
If we fail to integrate our patent assets into our operations, or if we fail to properly evaluate other acquisitions or investments, we may not achieve the anticipated benefits of any such acquisitions, we may incur costs in excess of what we anticipate, and management resources and attention may be diverted from other necessary or valuable activities. 37 Any failure to maintain effective internal control over financial reporting could harm us.
If we fail to integrate our patent assets into our operations, or if we fail to properly evaluate other acquisitions or investments, we may not achieve the anticipated benefits of any such acquisitions, we may incur costs in excess of what we anticipate, and management resources and attention may be diverted from other necessary or valuable activities.
We have no prior experience in developing or securing regulatory approvals for veterinary drugs or treatments. If we do not receive regulatory approvals for current or future product candidates, we may not be able to continue our operations.
As a company, we have limited experience in preparing, submitting and prosecuting regulatory filings. We have no prior experience in developing or securing regulatory approvals for veterinary drugs or treatments. If we do not receive regulatory approvals for current or future product candidates, we may not be able to continue our operations.
These operating losses have adversely affected and are likely to continue to adversely affect our working capital, total assets and stockholders’ equity. We have generated operating losses of $13,841,204 and $13,206,396 in the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024 and 2023, we had cumulative losses of $52,749,316 and $37,886,155, respectively.
These operating losses have adversely affected and are likely to continue to adversely affect our working capital, total assets and stockholders’ equity. We have generated operating losses of $13,990,408 and $13,841,204 in the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025 and 2024, we had cumulative losses of $67,520,328 and $52,749,316, respectively.
If we are unable to remediate the deficiencies identified adequately or otherwise fail to maintain adequate financial and management personnel, processes and controls, we may not be able to manage our business effectively or accurately report our financial performance on a timely basis, which could cause a decline in our common stock price and adversely affect our results of operations and financial condition.
If we are unable to remediate the deficiencies identified adequately or otherwise fail to maintain adequate financial and management personnel, processes and controls, we may not be able to manage our business effectively or accurately report our financial performance on a timely basis, which could cause a decline in our common stock price and adversely affect our results of operations and financial condition. 32 Our issuance of additional capital stock in connection with financings, acquisitions, investments, our 2023 Stock Incentive Plan or otherwise will dilute all other stockholders.
These measures may not, for example, in the case of misappropriation of a trade secret by an employee or third party with authorized access, provide adequate protection for our proprietary information.
However, trade secrets and know-how can be difficult to protect. These measures may not, for example, in the case of misappropriation of a trade secret by an employee or third party with authorized access, provide adequate protection for our proprietary information.
Our failure to become and remain profitable would decrease the value of the Company and could impair our ability to raise capital, maintain our research and development efforts, expand our business or continue our operations. A decline in the value of our Company also could cause you to lose all or part of your investment.
Our failure to become and remain profitable would decrease the value of the Company and could impair our ability to raise capital, maintain our research and development efforts, expand our business or continue our operations.
Should any third party with which we enter into any of these arrangements not comply with the applicable regulatory requirements, we or they may be subject to regulatory enforcement action and we or they may be delayed or prevented from obtaining marketing approval for the applicable product candidate.
Should any third party with which we enter into any of these arrangements not comply with the applicable regulatory requirements, we or they may be subject to regulatory enforcement action and we or they may be delayed or prevented from obtaining marketing approval for the applicable product candidate. 21 In addition, we face significant competition in seeking appropriate strategic partners and the negotiation process is time-consuming and complex.
Furthermore, our stock price may be impacted by factors that are unrelated or disproportionate to our operating performance. These market fluctuations, as well as general economic, political and market conditions, such as recessions, interest rates or international currency fluctuations may adversely affect the market price of our common stock.
These market fluctuations, as well as general economic, political and market conditions, such as recessions, interest rates or international currency fluctuations may adversely affect the market price of our common stock.
Consequently, we may not be able to prevent third parties from practicing our inventions, or from selling or importing products made using our inventions in and into the United States or other jurisdictions.
In addition, the laws of some foreign countries may not protect our intellectual property rights to the same extent as the laws in the United States. Consequently, we may not be able to prevent third parties from practicing our inventions, or from selling or importing products made using our inventions in and into the United States or other jurisdictions.
In patent litigation in the United States, defendant counterclaims alleging invalidity or unenforceability are commonplace. Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness, non-enablement or insufficient written description.
Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness, non-enablement or insufficient written description.
Risks related to product development and regulatory process We are early in our development efforts of some of our product candidates, and our business is dependent on the successful development of our current and future product candidates.
We are early in our development efforts of POCT and VELDONA candidates, and our business is dependent on the successful development of our current and future POCT and VELDONA candidates.
We are vulnerable to damage from other types of disasters, including power loss, attacks from extremist organizations, fires, floods, and similar events. If our facilities are affected by a natural or man-made disaster, we may be forced to curtail our operations and/or rely on third-parties to perform some or all of our research and development activities.
If our facilities are affected by a natural or man-made disaster, we may be forced to curtail our operations and/or rely on third-parties to perform some or all of our research and development activities.
Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations and prospects. We may be subject to damages resulting from claims that we or our employees have wrongfully used or disclosed alleged trade secrets of our competitors or are in breach of non-competition or non-solicitation agreements with our competitors.
We may be subject to damages resulting from claims that we or our employees have wrongfully used or disclosed alleged trade secrets of our competitors or are in breach of non-competition or non-solicitation agreements with our competitors.
The process of obtaining marketing approvals, in Taiwan, the United States and other jurisdictions, is expensive, may take many years, if approval is obtained at all, and can vary substantially based upon a variety of factors, including the type, complexity, and novelty of the product candidates involved.
POCT and VELDONA candidates we develop may not be effective or may prove to have adverse characteristics that may preclude our obtaining marketing approval or prevent or limit commercial use. 15 The process of obtaining marketing approvals, in Taiwan, the United States and other jurisdictions, is expensive, may take many years, if approval is obtained at all, and can vary substantially based upon a variety of factors, including the type, complexity, and novelty of the product candidates involved.
We may become involved in lawsuits to protect or enforce our patents or other intellectual property, which could be expensive, time-consuming and unsuccessful, and issued patents directed towards our technology and product candidates could be found invalid or unenforceable if challenged.
Such proceedings also may result in substantial cost and require significant time from our scientists and management, even if the eventual outcome is favorable to us. 24 We may become involved in lawsuits to protect or enforce our patents or other intellectual property, which could be expensive, time-consuming and unsuccessful, and issued patents directed towards our technology and product candidates could be found invalid or unenforceable if challenged.
An adverse result in any litigation proceeding could put one or more of our owned or licensed patents at risk of being invalidated, held unenforceable or interpreted narrowly.
An adverse result in any litigation proceeding could put one or more of our owned or licensed patents at risk of being invalidated, held unenforceable or interpreted narrowly. We may find it impractical or undesirable to enforce our intellectual property against some third parties.
If we experience termination or delays in the completion of any clinical trial of our product candidates, the commercial prospects of our product candidates will be harmed, and our ability to generate product revenues from any of these product candidates may be delayed.
Many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of marketing approval of our POCT and VELDONA candidates. 14 If we experience termination or delays in the completion of any clinical trial of our POCT and VELDONA candidates, the commercial prospects of our POCT and VELDONA candidates will be harmed, and our ability to generate product revenues from any of these product candidates may be delayed.
Our estimates of the total addressable market for our product candidates are based on internal and third-party estimates as well as a number of significant assumptions. Market opportunity estimates and growth forecasts are subject to significant uncertainty and are based on assumptions and estimates.
The total addressable market opportunity for our current and future products may be much smaller than we estimate. Our estimates of the total addressable market for our product candidates are based on internal and third-party estimates as well as a number of significant assumptions.
We cannot assure you that any intellectual property rights that we currently have or may receive can be successfully asserted in the future or that they will not be invalidated, circumvented or challenged. In addition, the laws of some foreign countries do not protect proprietary rights to the same extent, as do the laws of the United States.
Intellectual property rights vary across foreign jurisdictions, and we may not be able to protect our intellectual property rights throughout the world. We cannot assure you that any intellectual property rights that we currently have or may receive can be successfully asserted in the future or that they will not be invalidated, circumvented or challenged.
We may find it impractical or undesirable to enforce our intellectual property against some third parties. 29 If we were to initiate legal proceedings against a third party to enforce a patent directed to our product candidates, or one of our future product candidates, the defendant could counterclaim that our patent is invalid or unenforceable.
If we were to initiate legal proceedings against a third party to enforce a patent directed to our product candidates, or one of our future product candidates, the defendant could counterclaim that our patent is invalid or unenforceable. In patent litigation in the United States, defendant counterclaims alleging invalidity or unenforceability are commonplace.
Our current and anticipated future dependence upon others for the manufacture of our product candidates may adversely affect our future profit margins and our ability to develop product candidates and commercialize any products that receive marketing approval on a timely and competitive basis. We currently have limited marketing capabilities.
In addition, if we are not able to obtain adequate supplies of our product candidates or the substances used to manufacture them, it will be more difficult for us to develop our product candidates and compete effectively. 20 Our current and anticipated future dependence upon others for the manufacture of our product candidates may adversely affect our future profit margins and our ability to develop product candidates and commercialize any products that receive marketing approval on a timely and competitive basis.
We are focused on product development and have generated $20,321 and $256 in revenues from pet supplements sales and $408 and $102,256 in revenues from COVID 19 antigen rapid test kits in 2024 and 2023, respectively. We expect to continue to incur operating losses until we are able to commercialize or license our other products.
We are focused on product development and have generated $123,360 and nil in revenues from AI Nose related product, and $797 and $20,321 from pet supplements, in the years ended December 31, 2025 and 2024, respectively. We expect to continue to incur operating losses until we are able to commercialize or license our other products.
In addition to contractual measures, we try to protect the confidential nature of our proprietary information through other appropriate precautions, such as physical and technological security measures. However, trade secrets and know-how can be difficult to protect.
Ultimately, enforcing a claim that a party illegally disclosed or misappropriated a trade secret can be difficult, expensive, and time-consuming, and the outcome is unpredictable. 26 In addition to contractual measures, we try to protect the confidential nature of our proprietary information through other appropriate precautions, such as physical and technological security measures.
These estimates, which have been derived from a variety of sources, including market research and our own internal estimates, may prove to be incorrect. Further, the continued development of, and approval or authorizations for, vaccines and therapeutic treatments may affect these market opportunity estimates. Our market opportunity may also be limited by new products that enter the market.
Further, the continued development of, and approval or authorizations for, vaccines and therapeutic treatments may affect these market opportunity estimates. Our market opportunity may also be limited by new products that enter the market. If any of our estimates prove to be inaccurate, the market opportunity for platform and products could be significantly less than we estimate.
If any of our confidential or proprietary information, such as our trade secrets, were to be disclosed or misappropriated, or if any of that information was independently developed by a competitor, our competitive position could be harmed. 31 In addition, courts inside and outside the United States are sometimes less willing or unwilling to protect trade secrets.
In addition, our trade secrets may be independently developed by others in a manner that could prevent us from receiving legal recourse. If any of our confidential or proprietary information, such as our trade secrets, were to be disclosed or misappropriated, or if any of that information was independently developed by a competitor, our competitive position could be harmed.
If adequate funds are not available on acceptable terms, or at all, our business, results of operations, financial condition and our continued viability will be materially adversely affected. 18 Our operating results may fluctuate significantly, which will make our future results difficult to predict and could cause our results to fall below expectations.
If we are able to consummate a financing arrangement, the amount raised may not be sufficient to meet our future needs. If adequate funds are not available on acceptable terms, or at all, our business, results of operations, financial condition and our continued viability will be materially adversely affected.
Any such breach, loss or compromise of clinical trial participant personal data may also subject us to civil fines and penalties under the privacy laws of the European Union or other countries as well as state and federal privacy laws in the United States.
Any such breach, loss or compromise of clinical trial participant personal data may also subject us to civil fines and penalties under the privacy laws of the European Union or other countries as well as state and federal privacy laws in the United States. 18 Risks related to reliance on third parties Our reliance on third-party components and cloud infrastructure could disrupt AI Nose operations, and any errors, disruption, performance problems, or failure in their or our operational infrastructure could adversely affect our business, financial condition, and results of operations.
If any of our estimates prove to be inaccurate, the market opportunity for platform and products could be significantly less than we estimate. If this turns out to be the case, our potential for growth may be limited and our business and future prospects may be materially adversely affected.
If this turns out to be the case, our potential for growth may be limited and our business and future prospects may be materially adversely affected. We may not obtain approval for our product candidates in any jurisdictions.
We need to raise additional capital to operate our business. If we fail to obtain the capital necessary to fund our operations, we will be unable to continue or complete our product development. We are a company primarily focused on product development and our product revenues may not be sufficient to fund our operations.
A decline in the value of our Company also could cause you to lose all or part of your investment. 9 We need to raise additional capital to operate our business. If we fail to obtain the capital necessary to fund our operations, we will be unable to continue or complete our product development.
If we choose to go to court to stop a third party from using any of our trade secrets, we may incur substantial costs and we cannot guarantee a successful outcome. Even if we are successful, these types of lawsuits may consume significant amounts of our time and other resources.
In addition, courts inside and outside the United States are sometimes less willing or unwilling to protect trade secrets. If we choose to go to court to stop a third party from using any of our trade secrets, we may incur substantial costs and we cannot guarantee a successful outcome.
Until, and if, we receive approval from the TFDA, FDA and other regulatory authorities for our product candidates, our revenues generated from products may be limited.
We are a company primarily focused on product development and our product revenues may not be sufficient to fund our operations. Until, and if, we deploy AI Nose at scale or receive approval from the TFDA, FDA and other regulatory authorities for our POCT and VELDONA product candidates, our revenues generated from these products may be limited.
Similar challenges to obtaining coverage and reimbursement will apply to companion POCTs that we or our collaborators may develop.
Similar challenges to obtaining coverage and reimbursement will apply to companion POCTs that we or our collaborators may develop. Even if our agreements with current or future collaborators entitle us to indemnification against losses, such indemnification may not be available or adequate should any claim arise.
Our means of protecting any proprietary rights we may receive in the United States or abroad may not be adequate. Filing, prosecuting, maintaining, defending and enforcing patents on our product candidates in all countries throughout the world would be prohibitively expensive.
Filing, prosecuting, maintaining, defending and enforcing patents on our product candidates in all countries throughout the world would be prohibitively expensive. The requirements for patentability may differ in certain countries, particularly developing countries, and the breadth of patent claims allowed can be inconsistent.
The requirements for patentability may differ in certain countries, particularly developing countries, and the breadth of patent claims allowed can be inconsistent. In addition, the laws of some foreign countries may not protect our intellectual property rights to the same extent as the laws in the United States.
In addition, the laws of some foreign countries do not protect proprietary rights to the same extent, as do the laws of the United States. Our means of protecting any proprietary rights we may receive in the United States or abroad may not be adequate.
We may not be able to obtain adequate remedies for any breaches of such agreements. Ultimately, enforcing a claim that a party illegally disclosed or misappropriated a trade secret can be difficult, expensive, and time-consuming, and the outcome is unpredictable.
We may not be able to obtain adequate remedies for any breaches of such agreements.
Removed
If we are able to consummate a financing arrangement, the amount raised may not be sufficient to meet our future needs.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur internal cybersecurity coordinator is responsible for assessing and managing our material risks from cybersecurity threats, in close collaboration with our IT team and report to our CEO. This ensures that the senior management are kept abreast of the cybersecurity posture and potential risks faced by the Company. ITEM 2. DESCRIPTION OF PROPERTY.
Biggest changeOur internal cybersecurity coordinator is responsible for assessing and managing our material risks from cybersecurity threats, in close collaboration with our IT team and report to our CEO. This ensures that the senior management are kept abreast of the cybersecurity posture and potential risks faced by the Company.
We monitor and test our safeguards and train our employees on these safeguards, in collaboration with human resources, IT, and management. We promote a company-wide culture of cybersecurity risk management. Risks from Cybersecurity Threats We have not encountered cybersecurity challenges that have materially impaired our operations or financial standing during the fiscal year ended December 31, 2024.
We monitor and test our safeguards and train our employees on these safeguards, in collaboration with human resources, IT, and management. We promote a company-wide culture of cybersecurity risk management. Risks from Cybersecurity Threats We have not encountered cybersecurity challenges that have materially impaired our operations or financial standing during the fiscal year ended December 31, 2025.
Removed
Our administrative offices are located at San Diego, California and in Taiwan. Our product development facility is in Taiwan. ITEM 3. LEGAL PROCEEDINGS . There are currently no legal proceedings involving the Company. ITEM 4. MINE SAFETY DISCLOSURES. Not applicable. 39 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeSince many of the shares of our common stock are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of beneficial stockholders represented by these record holders. Stock Performance Graph Not applicable. Recent Sales of Unregistered Securities Not applicable. Use of Proceeds from Registered Securities Not applicable.
Biggest changeSince many of the shares of our common stock are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of beneficial stockholders represented by these record holders. Stock Performance Graph Not applicable.
Future determinations as to the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then-existing conditions, including our operating results, financial condition, contractual restrictions, capital requirements, business prospects and other factors our board of directors may deem relevant. 40 Securities Authorized for Issuance Under Equity Compensation Plans The information required by this Item regarding equity compensation plans is incorporated by reference to the information set forth in Part III, Item 12 of this Annual Report.
Future determinations as to the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then-existing conditions, including our operating results, financial condition, contractual restrictions, capital requirements, business prospects and other factors our board of directors may deem relevant. 34 Securities Authorized for Issuance Under Equity Compensation Plans The information required by this Item regarding equity compensation plans is incorporated by reference to the information set forth in Part III, Item 12 of this Annual Report.
Further, to comply with Nasdaq’s minimum $1.00 per share continued listing rules, we filed a Certificate of Amendment to its Restated Certificate of Formation on November 27, 2023, to apply for another reverse stock split of our common stock at a ratio of 1-for-5 which was effectuated on December 14, 2023 after receiving required approvals.
On November 27, 2023, to comply with Nasdaq’s minimum $1.00 per share continued listing rules, we filed a Certificate of Amendment to its Restated Certificate of Formation, to apply for reverse stock split of our common stock at a ratio of 1-for-5 which was effectuated on December 14, 2023 after receiving required approvals.
Holders of Common Stock As of March 7, 2025, there were approximate 241 shareholders of record of the Company’s common stock based upon the records of the shareholders provided by the Company’s transfer agent.
Holders of Common Stock As of March 30, 2026, there were approximate 220 shareholders of record of the Company’s common stock based upon the records of the shareholders provided by the Company’s transfer agent.
Added
Further, to comply with Nasdaq’s minimum $1.00 per share continued listing rules, the Company apply for another reverse stock split of our common stock at a ratio of 1-for-5 which was effectuated on June 30, 2025 after receiving required approvals.
Added
Recent Sales of Unregistered Securities For the fiscal year ended December 31, 2025, we have issued 2,158,086 unregistered securities, including (i) 1,160,000 shares issued to ScentAI Inc., (ii) 950,000 shares issued to the Company’s directors and employees as special stock awards, and (iii) 48,086 shares issued pursuant to a marketing service agreement. Use of Proceeds from Registered Securities Not applicable.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

32 edited+42 added−28 removed20 unchanged
Biggest changeResults of Operations The following table summarizes our results of operations for the years ended December 31, 2024 and 2023: Years ended December 31, Change 2024 2023 Amount % Revenues $ 20,729 $ 122,112 $ (101,383 ) (83 )% Cost of revenues (52,595 ) (375,845 ) 323,250 (86 )% Gross loss (31,866 ) (253,733 ) 221,867 (87 )% Operating expenses: Research and development expenses 8,413,923 7,317,388 1,096,535 15 % Selling, general and administrative expenses 5,395,415 5,635,275 (239,860 ) (4 )% Total operating expenses 13,809,338 12,952,663 856,675 7 % Loss from operating (13,841,204 ) (13,206,396 ) (634,808 ) 5 % Non-operating (expenses) income Interest expense (616,467 ) (144,193 ) (472,274 ) 328 % Issuance cost of senior secured convertible note measured at fair value (308,336 ) (525,643 ) 217,307 (41 )% Fair value change for senior secured convertible note (275,624 ) 94,207 (369,831 ) (393 )% Other income, net 179,270 12,276 166,994 1,360 % Total non-operating expenses, net (1,021,157 ) (563,353 ) (457,804 ) 81 % Net loss before income taxes (14,862,361 ) (13,769,749 ) (1,092,612 ) 8 % Provision for income taxes 800 800 - - Net loss $ (14,863,161 ) $ (13,770,549 ) $ (1,092,612 ) 8 % Revenues, Cost and Gross Loss The Company reported $20,729 of revenues for the year ended December 31, 2024, as compared to $122,112 for the year ended December 31, 2023 from the sales of in Taiwan.
Biggest changeResults of Operations The following table summarizes our results of operations for the years ended December 31, 2025 and 2024: Years ended December 31, Change 2025 2024 Amount % Revenues $ 124,157 $ 20,729 $ 103,428 499 % Cost of revenues (21,246 ) (52,595 ) 31,349 (60 )% Gross profit (loss) 102,911 (31,866 ) 134,777 (423 )% Operating expenses: Research and development expenses 7,749,772 8,413,923 (664,151 ) (8 )% Selling, general and administrative expenses 6,343,547 5,395,415 948,132 18 % Total operating expenses 14,093,319 13,809,338 283,981 2 % Loss from operating (13,990,408 ) (13,841,204 ) (149,204 ) 1 % Non-operating (expenses) income Interest expense (711,903 ) (616,467 ) (95,436 ) 15 % Issuance cost of senior secured convertible note measured at fair value - (308,336 ) 308,336 (100 )% Fair value change for senior secured convertible note - (275,624 ) 275,624 (100 )% Other income (expenses), net (67,901 ) 179,270 (247,171 ) (138 )% Total non-operating expenses, net (779,804 ) (1,021,157 ) 241,353 (24 )% Net loss before income taxes (14,770,212 ) (14,862,361 ) 92,149 (1 )% Provision for income taxes 800 800 - - Net loss $ (14,771,012 ) $ (14,863,161 ) $ 92,149 (1 )% 37 Revenues, Cost and Gross Loss The Company reported $124,157 of revenues for the year ended December 31, 2025, as compared to $20,729 for the year ended December 31, 2024.
We may continue to incur operating losses in the near term as our operating expenses will be increased to support the growth of our business. We expect that our selling, general and administrative expenses, and research and development expenses will continue to increase our internal sales force to move forward our product development and commercialization roadmaps.
We may continue to incur operating losses in the near term as our operating expenses will be increased to support the growth of our business. We expect that our selling, general and administrative expenses and research and development expenses will continue to increase as our internal sales force to move forward our product development and commercialization roadmaps.
To estimate the undiscounted cash flow of the asset group, we used assumptions require significant judgment, including judgment about when the in-development product can be commercialized, estimated selling price and sales volume of the in-development product and the amount and timing of other cash outflows required to complete the development, commercialization and sales of the product.
To estimate the undiscounted cash flow of the asset group, we used assumptions requiring significant judgment, including judgment about when the in-development product can be commercialized, estimated selling price and sales volume of the in-development product and the amount and timing of other cash outflows required to complete the development, commercialization and sales of the product.
During the fourth quarter of 2024, we reassessed our short-term and long-term commercial plans for the VOC POCT related products which is identified as an asset group being assigned the major intangible assets and identified that an impairment testing is warranted for the intangible assets.
During the fourth quarter of 2025, we reassessed our short-term and long-term commercial plans for the VOC POCT related products which is identified as an asset group being assigned the major intangible assets and identified that an impairment testing is warranted for the intangible assets.
Sales of the Common Stock may be made by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) of the Securities Act of 1933, as amended (the “Securities Act”), including, without limitation, sales made directly on or through the Nasdaq Capital Market.
Sales of the Common Stock may be made by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) of the Securities Act, including, without limitation, sales made directly on or through the Nasdaq Capital Market.
As disclosed in Note 6 (Debt) to our accompanying financial statements, we repaid $1,439,754 in cash to retired senior secured convertible notes from the Lind Note transaction in August 2024. As disclosed in Note 6 (Debt) to our accompanying financial statements, we repaid $42,000 to retire the i2China Note transaction in August 2024.
As disclosed in Note 6 (Debt) to our accompanying financial statements, we repaid $1,439,754 in cash to retired senior secured convertible notes from the Lind Note transaction in August 2024.
The Company has also agreed to reimburse the Agent for the fees and disbursements of its counsel, payable upon execution of the Sales Agreement, in an amount not to exceed $35,000 in addition to certain ongoing disbursements of its legal counsel up to $2,500 per calendar quarter.
The Company has reimbursed the Agent for the fees and disbursements of its counsel, payable upon execution of the Sales Agreement, in an amount not to exceed $35,000 in addition to certain ongoing disbursements of its legal counsel up to $2,500 per calendar quarter. In addition, the Company has agreed to provide customary indemnification rights to the Agent.
The increase was due to increase in refundable deposits and other noncurrent assets offset by decrease in purchase of property and equipment. Financing activities Cash received from financing activities were $8,025,746 and $4,923,673 during the years of 2024 and 2023, respectively.
The decrease was due to increase in refundable deposits and other noncurrent assets offset by decrease in purchase of property and equipment. Financing activities Cash received from financing activities were $1,008,461 and $8,025,746 during the years of 2025 and 2024, respectively.
Off-Balance Sheet Arrangements We had no off-balance sheet arrangements as of December 31, 2024.
Off-Balance Sheet Arrangements We had no off-balance sheet arrangements as of December 31, 2025. 42
The share-based compensation expense and the depreciation expense for manufacturing in the year ended December 31, 2024 and 2023 were $9,032 and $80,655, respectively. When excluding these non-cash cost, cost of revenue decreased to $43,563 during the year ended December 31, 2024 compared to $295,190 for the same period in 2023.
The share-based compensation expense and the depreciation expense for manufacturing in the year ended December 31, 2025 and 2024 were nil and $9,032, respectively. When excluding these non-cash costs, cost of revenue decreased to $21,246 during the year ended December 31, 2025 compared to $43,563 for the same period in 2024.
The increase in cash used in operations primarily resulted from our net loss for the year of 2024 due to swift product but offset by cash inflow contributed by the operating assets and liabilities. Investing activities Net cash used in investing activities during the year of 2024 was $125,292 compared to $101,525 during the year of 2023.
The decrease in cash used in operations primarily resulted from our net loss for the year of 2025 due to increase in cash inflow contributed by the operating assets and liabilities. Investing activities Net cash used in investing activities during the year of 2025 was $2,223 compared to $125,292 during the year of 2024.
The Company may instruct the Agent not to sell the Shares if the sales cannot be effected at or above the price designated by the Company from time to time and the Company may at any time suspend sales pursuant to the ATM Agreement. 45 The Company will pay the Agent placement fee of 3.0% of the gross sales price of the Shares sold by the Agent under the ATM Agreement.
The Company may instruct the Agent not to sell the Shares if the sales cannot be effected at or above the price designated by the Company from time to time, and the Company may at any time suspend sales pursuant to the ATM Agreement.
The precise amount and timing of the application of these proceeds will depend upon a number of factors, such as the timing and progress of our research and development efforts, our funding requirements and the availability and costs of other funds. As of December 31, 2024, there have been no shares sold under the ATM Agreement.
The precise amount and timing of the application of these proceeds will depend upon a number of factors, such as the timing and progress of our research and development efforts, our funding requirements and the availability and costs of other funds.
We may also have cash requirements related to capital expenditures to support the planned growth of our business, including investments in corporate facilities and equipment. 46 Contractual Obligations and Commitments For a discussion of our contractual obligations and commitments, refer to Part II, Item 8, Note 13, “Commitments and Contingencies” to the financial statements in this Annual Report on Form 10-K.
For a discussion of our contractual obligations and commitments, refer to Part II, Item 8, Note 13, “Commitments and Contingencies” to the financial statements in this Annual Report on Form 10-K.
In addition, the Company has agreed to provide customary indemnification rights to the Agent. The aggregate market value of Shares eligible for sale in the ATM Offering and under the ATM Agreement will be subject to the limitations of General Instruction I.B.6 of Form S-3, to the extent required under such instruction.
Wainwright & Co., LLC (“Wainwright”), pursuant to which the Company may issue and sell, from time to time, shares of its common stock. The aggregate market value of Shares eligible for sale in the Offering and under the ATM Agreement will be subject to the limitations of General Instruction I.B.6 of Form S-3 to the extent required under such instruction.
Gross loss from product sales for the year ended December 31, 2024 was $31,866 as compared to $253,733 for the year ended December 31, 2023.
Gross profit (loss) from product sales for the year ended December 31, 2025 was $102,911 as compared to $(31,866) for the year ended December 31, 2024. The gross profit was due to the aforementioned change in product mix.
The cost of revenues relating to product sales for the year ended December 31, 2024 was $52,595 compared to $375,845 for the year ended December 31, 2023. The decrease of cost of revenues primarily caused by the decline in sales volume of COVID-19 Antigen Rapid Test Kits.
The Company has ceased selling COVID-19 Antigen Rapid Test Kit since first quarter of 2024. The cost of revenues relating to product sales for the year ended December 31, 2025 was $21,246 compared to $52,595 for the year ended December 31, 2024. The decrease of cost of revenues was primarily caused by the aforementioned change in product mix.
As disclosed in Note 6 (Debt) to our accompanying financial statements, we repaid $270,000 to retire the KY Note transaction in October 2024. The Company anticipates that cash reserves, business revenues, and potential debt financing through convertible and non-convertible notes will fund the Company’s operations over the next twelve months.
The Company anticipates that cash reserves, business revenues, and potential debt financing through convertible and non-convertible notes will fund the Company’s operations over the next twelve months. There can be no assurance that we will be successful in our efforts to make the Company profitable.
There can be no assurance that we will be successful in our efforts to make the Company profitable. If those efforts are not successful, the Company may raise additional capital through the issuance of equity securities, debt financings or other sources to further implement its business plan.
If those efforts are not successful, the Company may raise additional capital through the issuance of equity securities, debt financings or other sources to further implement its business plan. However, if such financing is not available when needed and at adequate levels, the Company will need to reevaluate its operating plan.
The prospectus supplement filed with the SEC on July 11, 2024, is offering Shares having an aggregate offering price of $1,840,350. The Company intends to use the net proceeds from the offering to fund the continued development of its product candidate and for general corporate purposes and working capital.
The Company used the net proceeds from the offering to fund the continued development of its product candidate and for general corporate purposes and working capital.
Sources of Liquidity Since our uplisting and public offering in August 2022, our operations have been financed primarily by proceeds from private placements of convertible notes issued to third party or related party.
As of December 31, 2025, the Company sold an aggregate of 734,214 shares of the Company’s common stock under the ATM facility and received $2,008,721 in net proceeds, after deducting commissions and expenses. 40 Sources of Liquidity Since our uplisting and public offering in August 2022, our operations have been financed primarily by proceeds from private placements of convertible notes issued to third parties or related parties.
We continued to invest resources to execute our growth strategy and product roadmap to improve our profitability. Non-operating expenses The interest expense was $616,467 and $144,193 during the years ended December 31, 2024 and 2023, respectively.
Operating Loss The Company’s operating loss was $13,990,408 and $13,841,204 during the years ended December 31, 2025 and 2024, respectively, reflecting a $149,204 slight increase in operating losses between the years. We continued to invest resources to execute our growth strategy and product roadmap to improve our profitability.
However, if such financing is not available when needed and at adequate levels, the Company will need to reevaluate its operating plan. At The Market Offering Agreement On May 31, 2024, the Company entered into an At The Market Offering Agreement (the “ATM Agreement”), with H.C.
At The Market Offering Agreement On May 31, 2024, the Company entered into an At The Market Offering Agreement (the “ATM Agreement”), with H.C.
The decrease of revenue in 2024 was primarily caused by COVID-19 Antigen Rapid Test Kits in lower sales volume and was offset by the exchange rate fluctuations. We generated $20,321 and $256 in revenues from pet supplements and $408 and $102,256 in revenues from COVID-19 Antigen Rapid Test Kits in 2024 and 2023, respectively.
The increase of revenue in 2025 was primarily caused by a change in product mix; the Company generated $123,360 and nil in revenues from AI Nose related programs, and $797 and $20,321 from pet supplements, and nil and $408 in revenues from COVID-19 Antigen Rapid Test Kits in 2025 and 2024, respectively.
The $3,102,073 increase was primarily reflected by the following: ● Repayment of convertible notes and other notes payable increased by $1,065,728; ● Proceeds from convertible notes and other notes payable financing increased by $3,875,000; and ● Payments of issuance cost of senior secured convertible note measured at fair value decreased by $292,801.
The $7,017,285 decrease was primarily reflected by the following: ● Repayment of convertible notes and other notes payable decreased by $751,754; ● Proceeds from convertible notes and other notes payable financing decreased by $9,875,000; ● Proceeds from at-the-market offering, net of issuance costs increased by $2,008,721; ● Payments of issuance cost of senior secured convertible note measured at fair value decreased by $97,500; and ● Fractional shares paid out in cash for the reverse stock split increase by $260.
When excluding these non-cash expenses, SG&A expenses slight decreased to $2,570,672 in 2024 compared to $2,749,059 in 2023 mainly due to decreased professional expenses, expenditures to public relations and investor relations fees, and D&O insurance expenses.
The share-based compensation expense and the depreciation and amortization expense in 2025 and 2024 were $3,942,820 and $2,824,743, respectively. When excluding these non-cash expenses, SG&A expenses slightly decreased to $2,400,727 in 2025 compared to $2,570,672 in 2024 mainly due to decreased professional expenses and D&O insurance expenses.
The $239,860 (4%) slight decrease was due to decreased professional expenses, public relations and investor relations fees, and D&O insurance expenses, but offset by staffing expenditures (including share-based compensation). The share-based compensation expense and the depreciation and amortization expense in 2024 and 2023 were $2,824,743 and $2,886,216, respectively.
Selling, General and Administrative (SG&A) Expenses SG&A expenses were $6,343,547 and $5,395,415 for the years ended December 31, 2025 and 2024, respectively. The $948,132 (18%) increase was due to increase in staffing expenditures (including share-based compensation), public relations and investor relations fees, and advertising expense, but offset by decreased professional expenses and D&O insurance expenses.
Liquidity and Capital Resources As of December 31, 2024 and 2023, the Company had available cash and cash equivalents of $3,892,919 and $1,885,628, respectively. 44 The following table summarizes our cash flow during the years ended December 31, 2024 and 2023: Years ended December 31, Change 2024 2023 Amount % Net cash used in operating activities $ (5,808,267 ) $ (4,694,668 ) $ (1,113,599 ) 24 % Net cash used in investing activities $ (125,292 ) $ (101,525 ) $ (23,767 ) 23 % Net cash provided by financing activities $ 8,025,746 $ 4,923,673 $ 3,102,073 63 % Operating activities Net cash used in operating activities increased by $1,113,599 during the year of 2024 compared to the year of 2023.
The following table summarizes our cash flow during the years ended December 31, 2025 and 2024: Years ended December 31, Change 2025 2024 Amount % Net cash used in operating activities $ (4,614,697 ) $ (5,808,267 ) $ 1,193,570 (21 )% Net cash used in investing activities $ (2,223 ) $ (125,292 ) $ 123,069 (98 )% Net cash provided by financing activities $ 1,008,461 $ 8,025,746 $ (7,017,285 ) (87 )% Operating activities Net cash used in operating activities decreased by $1,193,570 during the year of 2025 compared to the year of 2024.
The gross loss was due to a low sales volume for newly launched products, and a lower cost of revenue. 43 When excluding these non-cash costs, gross loss decreased to $(22,834) during the year ended December 31, 2024 compared to $(173,078) for the same period in 2023.
When excluding these non-cash costs, gross profit (loss) increased to $102,911 during the year ended December 31, 2025 compared to $(22,834) for the same period in 2024. Research and Development (R&D) Expenses R&D expenses for the years ended December 31, 2025 and 2024 were $7,749,772 and $8,413,923, respectively.
When excluding these non-cash expenses, R&D expenses increased to $2,813,886 in 2024 from that of $2,064,658 in 2023 primarily caused by increasing in non-exclusive use of certain patents related to VOC and POCT technologies. Selling, General and Administrative (SG&A) Expenses SG&A expenses were $5,395,415 and $5,635,275 for the years ended December 31, 2024 and 2023, respectively.
The share-based compensation expense and the depreciation and amortization expense in 2025 and 2024 were $5,260,915 and $5,600,037, respectively. When excluding these non-cash expenses, R&D expenses decreased to $2,488,857 in 2025 from that of $2,813,886 in 2024 primarily caused by decreased co-development expenses.
Our products pipeline include commercial-stage VELDONA Pet supplements, clinical-stage VELDONA human therapeutics and telehealth-friendly POCTs powered by the AI Nose technology platform. Please refer to “Business” in Part I, Item 1 for description of our business.
Please refer to “Business” in Part I, Item 1 for description of our business. Key Developments in 2025 The following highlights major corporate developments in 2025 that management believes advanced the commercialization and scaling of our platform technologies: Advancement of AI Nose toward early commercialization.
We expect that our R&D expenses related to clinical trials will continue to grow as we further develop VOC POCT and VELDONA drug candidates and increase the pace of clinical trials previously delayed during the COVID-19 pandemic. The share-based compensation expense and the depreciation and amortization expense in 2024 and 2023 were $5,600,037 and $5,252,730, respectively.
The decrease of $664,151 (8%) was due to decreased staffing expenditures (including share-based compensation) and co-research expenses but offset by an increase in patent application & maintenance expenses. We expect that our R&D expenses will continue to grow as we further develop AI Nose programs and VELDONA drug candidates.
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Overview Ainos, Inc. (the “Company”), incorporated in the State of Texas in 1984, is a diversified healthcare company focused on the development of novel point-of-care testing (the “POCT”), therapeutics based on very low-dose interferon alpha (the “VELDONA”), and synthetic RNA-driven preventative medicine.
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Overview Ainos, Inc. (the “Company”), incorporated in the State of Texas in 1984, is a dual-platform company advancing artificial intelligence–based smelltech technologies and immune therapeutics. Our primary strategic focus is the commercialization of our proprietary scent digitization platform, AI Nose, while we also continue to develop therapeutic assets based on our low-dose oral interferon program, VELDONA®.
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Key Developments in 2024 The following highlights major corporate milestones in 2024 that we believe will serve as catalysts for us to develop and commercialize our product pipeline over the next several years: In December 2024, we announced the signing of a Memorandum of Understanding (MOU) with Taiwan Tanabe Seiyaku Co., Ltd.
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During 2025, we accelerated the transition of the AI Nose platform from development-stage validation to early-stage commercialization, with a focus on industrial and infrastructure-oriented applications. We expanded our industrial ecosystem through additional system integrators, distribution channels, and early customers, enabling pilot and initial commercial deployments across semiconductor manufacturing, robotics, and smart manufacturing environments.
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(“Taiwan Tanabe”), a subsidiary of Mitsubishi Tanabe Pharma Corporation in Japan. The parties may work under the terms of the MOU to further define the partnership for manufacturing and Taiwan market promotion of our Sjögren’s syndrome drug based on VELDONA.
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In semiconductor manufacturing environments, we secured an initial commercial order totaling approximately $2.1 million over three years from a leading semiconductor packaging and testing customer, supporting deployment of 1,400 AI Nose system.
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In September 2024, we announced a plan to conduct a Taiwan clinical study for VELDONA in 2025 on treating human immunodeficiency virus (HIV)-related oral warts. We also announced a plan to conduct a Taiwan clinical study in 2025 for VELDONA on treating Sjögren’s syndrome.
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We also entered into a commercial arrangement with a semiconductor engineering and systems integration partner that includes a contracted minimum order commitment of 600 AI Nose units targeting deployment in front-end wafer fabrication environments, expanding AI Nose’s reach upstream within the semiconductor value chain.
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We were also granted an invention patent in Taiwan and has filed for global patent protection under the Patent Cooperation Treaty (PCT) for treatment and prevention of coronavirus infection based on VELDONA. In August 2024, we announced that our VOC co-development program, initiated in 2023, with Nisshinbo Micro Devices Inc. (“NISD”) and Taiwan Inabata Sangyo Co.
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In validation activities conducted in Japanese semiconductor facilities, AI Nose achieved approximately 80% classification accuracy across more than 20 volatile organic compounds, supporting environmental monitoring, anomaly detection, and process awareness. These deployments generated structured scent data used to refine models and support broader commercialization.
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(“Taiwan Inabata”) achieved several key milestones. First, we have developed a solution targeting the elderly care market. Second, we marked a key milestone in expanding AI Nose application in industrial use-case, with our solution delivering 79% accuracy in 22 different volatile organic compounds (VOCs) in semiconductor factories.
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As part of our robotics-related expansion, we initiated pilot deployments of AI Nose across seven operational sites in Japan through a collaboration with a Japanese service robotics partner.
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We secured an exclusive, perpetual license of 10 invention patents and patent applications related to gas sensors and medical devices, covering the U.S., Germany, China, Japan and Taiwan.
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These pilots are designed to evaluate real-world performance in continuous monitoring and facility operations and to generate deployment data supporting further model refinement and commercial scaling. 35 Progress in healthcare-adjacent and senior care applications.
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In June 2024, we announced that our Taiwan clinical studies for Ainos Flora have tested 75 cases with meaningful insights, laying ground for development of second-generation Ainos Flora intended to be optimized for at-home testing. We have implemented CUDA to accelerate development.
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In parallel with industrial deployments, we continued to advance healthcare-adjacent applications of AI Nose, including senior care–oriented use cases that leverage non-invasive and continuous sensing for hygiene monitoring. We also continued to evaluate performance and usability in women’s health applications. Progress in VELDONA® therapeutic programs.
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In May 2024, we initiated a Taiwan clinical study to evaluate VELDONA’s clinical efficacy in treating feline chronic gingivostomatitis (“FCGS”), a chronic painful oral disease characterized by inflammation or abnormal proliferation in the oral cavity. 41 Factors Affecting Our Business We have pivoted away from sale of COVID-19 antigen rapid test kits, which were the main source of our revenues in 2023.
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For VELDONA®, we continued to focus on selected rare, autoimmune, and infectious disease indications with unmet medical needs, including oral warts in HIV-seropositive patients, Sjögren’s syndrome, and feline chronic gingivostomatitis (FCGS). During 2025, we advanced clinical preparation and ongoing studies in Taiwan for these indications and maintained discussions with potential partners regarding out-licensing opportunities.
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In 2024 our business activities focused on sales and marketing of VELDONA Pet, advancing our lead VOC POCT candidate, Ainos Flora, co-developing VOC sensing platform with our Japan partners, as well as advancing clinical studies and pursuing out-licensing of VELDONA human drug candidates. Through our marketing of VELDONA Pet, we gathered insights into the behavior of pet owners.
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Subject to regulatory review and study progress, we currently expect key clinical and partnering milestones to occur over the 2026–2027 timeframe. We also marketed Veldona Pet supplement in Taiwan on a limited scale.
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These insights have influenced our choice to allocate resources toward developing animal drugs. We identified a market opportunity in FCGS, a cat oral disease currently facing limited treatment options. In 2024, we started a clinical study in Taiwan for our FCGS program. Its success could impact our business plan.
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Factors Affecting Our Business Our business activities in 2025 were shaped primarily by our strategic emphasis on scaling the AI Nose platform and managing healthcare-related programs in a selective and capital-efficient manner. Shift toward industrial and infrastructure-oriented applications. We continued to prioritize the expansion of AI Nose into industrial environments where continuous sensing, anomaly detection, and operational monitoring are critical.
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For our VELDONA human drug development, we prioritize HIV oral warts and Sjogren’s syndrome due to limited treatment options for these conditions. In 2024, we prepared for clinical studies in Taiwan expected to commence in 2025. We have also progressed in out-licensing our drug candidates through a MOU with Taiwan Tanabe. These developments may affect our business.
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Partner-led deployments in semiconductor manufacturing, robotics, and smart manufacturing settings allowed us to validate the platform under demanding real-world conditions and to begin establishing commercial pathways through existing industrial ecosystems. The pace of adoption, partner execution, and customer conversion may affect our near-term results. Data-driven platform development. AI Nose deployments generate Smell ID data across diverse environments.
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We believe that consumers have become increasingly familiar with at-home tests, and people may seek additional at-home tests to manage other infections. Home self-testing have become increasingly available for other infections such as vaginal infections or sexually transmitted infections (STIs).
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We use this data to refine models, improve classification performance, and broaden the range of detectable patterns. We believe this data-driven feedback loop strengthens the long-term scalability of the platform, although the benefits may not be immediately reflected in revenue. Senior care and healthcare-adjacent opportunities.
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We believe this new user behavior, supported by a variety of telehealth platforms, will facilitate consumer adoption of our other POCT product candidates. Our lead candidate Ainos Flora is under clinical studies and we plan to explore strategic relationships to commercialize the product.
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In senior care and hospital-adjacent environments, we continued to evaluate use cases where non-invasive and continuous sensing may support hygiene monitoring and environmental control. These efforts remain exploratory and are influenced by regulatory pathways, partner engagement, and operational validation. VELDONA® program management.
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The result of clinical studies and our success in exploring strategic relationships, and the likelihood of regulatory approvals, may affect our business, at least in the near-term. We are co-developing a VOC sensing platform, powered by AI Nose technology, with our Japanese partners.
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For VELDONA®, we focused on selected indications with unmet medical needs, including oral warts in HIV-seropositive patients, Sjögren’s syndrome, and feline chronic gingivostomatitis. In 2025, we advanced ongoing and planned clinical studies in Taiwan while continuing to pursue strategic partnerships and out-licensing opportunities. Clinical outcomes, regulatory progress, and partner interest may affect the timing and direction of these programs.
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This project underscores our commitment to digitizing smell by pioneering VOC sensing’s potential across diverse industries, thereby broadening our addressable market. Under this program, we are developing solutions for the elderly care market and for industrial use-case. The progress may affect our business, at least in the near-term.
Added
Strategy Outlook Our strategy centers on scaling AI Nose as a SmellTech platform that digitizes scent as a machine-readable data modality. Following initial industrial validation in 2025, our priorities include expanding partner-led deployments, increasing scent data volume to refine the smell language model, and advancing commercialization through a combination of hardware sales and service-based offerings.
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As of December 31, 2024, we had available cash and cash equivalents of $3,892,919. We anticipate business revenues and further potential financial support from external sources to fund our operations over the next twelve months. We have based this estimate on assumptions that may prove to be incorrect, and we could exhaust our available capital resources sooner than we expect.
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In parallel, we plan to manage healthcare-related programs, including VELDONA®, in a selective and capital-efficient manner, with an emphasis on partnerships and out-licensing. 36 Recent Financing On May 31, 2024, the Company entered into an At-the-Market Offering Agreement, or sales agreement, with H.C.
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See “Liquidity and Capital Resources” for additional information. To finance our continuing operations, we will need to raise additional capital, which cannot be assured. Recent Financing On May 03, 2024, The Company entered into Convertible Note and Warrant Purchase Agreement with the ASE Test, Inc.
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The prospectus supplement filed with the SEC on July 11, 2024 is offering Shares having an aggregate offering price of $1,840,350. On September 5, 2025, the Company filed a prospectus supplement to amend the Prospectus to update the amount of shares the Company is eligible to sell pursuant to such prospectus.
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(“ASE”), a shareholder of Ainos KY, for the issuance of convertible promissory notes with 6% compound interest in the aggregate principal amount of $9,000,000 (collectively the “Notes”) convertible into shares of common stock, par value $0.01 per share, of the Company, payable three (3) years from May 03, 2024 as well as the issuance of warrants for the purchase of up to 500,000 shares of Common Stock at a price per share of $4.50, exercisable until May 03, 2029.
Added
The Company increased the amount of shares of Common Stock it may offer and sell under the Sales Agreement to an aggregate offering price of up to $874,496 from time to time through Wainwright.
Removed
As of December 31, 2024, the Company received the full amount of the payment.
Added
Pursuant to General Instruction I.B.6 of Form S-3, in no event will we sell securities in a public primary offering with a value exceeding one-third of our public float in any 12-month calendar period so long as our public float remains below $75.0 million.
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On August 2, 2024, the Company retired its remaining senior secured convertible debt (the “Note”) with Lind Global Fund II LP, an institutional investment fund managed by The Lind Partners (together the “Investor”), as a result of conversions by the Investor and payments by the Company, which aggregates at a total of approximately US$1.67 million.
Added
As of December 31, 2025, the Company sold 734,214 shares of common stock under At-the-Market Offering Agreement, resulting in net proceeds of approximately $2,008,721. During the period from January 1, 2026 to March 30, 2026, the Company sold 283,336 shares of common stock under the At-the-Market Offering Agreement, resulting in net proceeds of approximately $601,600.
Removed
The repayment was made with $1,439,754 in cash and $224,842 through the issuance of 382,384 shares of Common Stock, valued at $0.588 per share.
Added
On March 12, 2025, the Company entered into an amendment to the Convertible Note (the “Convertible Note Amendment”) with Li-Kuo Lee to extend the maturity date to May 13, 2025. On April 30, 2025, the Company repaid the full principal with accrued interest aggregate amount of $1,132,650.
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On August 16, 2024, the Company repaid the remaining note payable principal amount of $42,000 with accrued interest to i2China Management Group, LLC (“i2China”). 42 On October 7, 2024, the Company repaid the remaining note payable principal amount of $270,000 with accrued interest to Ainos KY, the controlling shareholder of the Company.
Added
Non-operating expenses Interest expense was $711,903 and $616,467 during the years ended December 31, 2025 and 2024, respectively.
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Research and Development (R&D) Expenses R&D expenses for the years ended December 31, 2024 and 2023 were $8,413,923 and $7,317,388, respectively. The increase $1,096,535 (15%) was due to increased staffing expenditures (including share-based compensation) and co-research expenses, but offset by a decrease in impairment loss and material expenses.
Added
The increase in interest expense was due to accrued interest for compounded convertible notes issued in May 2024, for which the face value increases in the second year due to the compounding feature. 38 Net Loss Net loss was $14,771,012 in 2025 compared to $14,863,161 in 2024, resulting in a $92,149 (1%) slight decrease in net loss attributable to common stockholders due decrease in co-research expenses and D&O insurance expenses.

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