Company Overview - Akari Therapeutics is an oncology biotechnology company focused on developing next-generation spliceosome payload antibody drug conjugates (ADCs) [4] - The company utilizes an innovative ADC discovery platform to generate and optimize ADC candidates for various targets [4] Lead Product Candidate - Akari's lead candidate, AKTX-101, targets the Trop2 receptor on cancer cells and employs a proprietary linker to deliver a novel PH1 payload directly into tumors [4] - PH1 is a spliceosome modulator designed to disrupt RNA splicing within cancer cells, leading to cancer cell death and activation of immune cells [4] - Preclinical studies indicate that AKTX-101 has significant activity and prolonged survival compared to traditional ADCs, and it shows potential synergy with checkpoint inhibitors [4] Upcoming Events - Abizer Gaslightwala, President and CEO of Akari Therapeutics, will present at the H.C. Wainwright 27th Annual Global Investment Conference from September 8-10, 2025 [1] - Management will also be available for in-person one-on-one meetings with qualified investors during the conference [2] - A video webcast of the presentation will be available on-demand starting September 5, 2025, and will be archived for 90 days [3]

Company Overview - Akari Therapeutics is an oncology biotechnology company focused on developing novel immuno-oncology payload antibody drug conjugates (ADCs) for cancer treatment [2][5] - The company has developed its first novel payload, PH1, which is a spliceosome modulator designed to disrupt RNA splicing within cells, differentiating it from current ADC payloads [5] Product Pipeline - Akari's lead candidate, AKTX-101, targets the Trop2 receptor on cancer cells and delivers the PH1 payload directly into tumors [5] - Preclinical studies have shown that AKTX-101 has significant activity and prolonged survival compared to traditional ADCs [5] - The company is generating validating data on its novel payload PH1 to advance its lead asset and other undisclosed targets [5] Upcoming Events - Akari Therapeutics will participate in the Virtual Investor Closing Bell Series on September 4, 2025, where the CEO will provide a corporate overview and discuss the innovative payload platform [3][4] - Investors will have the opportunity to submit questions live during the event [3]

Company Overview - Akari Therapeutics is a biotechnology company focused on developing novel Antibody Drug Conjugates (ADCs) with immuno-oncology payloads for cancer treatment [3] - The company has developed its first novel payload, PH1, which is a spliceosome modulator designed to disrupt RNA splicing within cells [3] - Akari's lead candidate, AKTX-101, targets the Trop2 receptor on cancer cells and delivers the PH1 payload directly into tumors [3] Product Development - PH1 is differentiated from current ADC payloads that typically use Topoisomerase1 inhibitors or tubulin inhibitors, showing potential to induce cancer cell death while activating immune cells [3] - In preclinical studies, AKTX-101 has demonstrated significant activity and prolonged survival compared to traditional ADCs [3] - AKTX-101 has the potential to work synergistically with checkpoint inhibitors, showing prolonged survival both as a single agent and in combination with these inhibitors [3] Upcoming Events - Akari Therapeutics will present at the Webull Financial Corporate Connect Webinar Series: Biotech/MedTech on August 19, 2025, at 2:00 PM ET [1]

[PART I FINANCIAL INFORMATION](index=6&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements of Akari Therapeutics, Plc for the periods ended June 30, 2025, and December 31, 2024 [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets (Amounts in thousands) | ASSETS | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash | $2,711 | $2,599 | | Total current assets | $3,301 | $2,952 | | Goodwill | $8,430 | $8,430 | | Other intangible assets | $39,180 | $39,180 | | Total assets | $50,911 | $50,562 | | LIABILITIES AND SHAREHOLDERS' EQUITY | | | | Accounts payable | $11,607 | $12,407 | | Accrued expenses | $2,468 | $3,137 | | Total current liabilities | $17,138 | $19,910 | | Total liabilities | $25,306 | $28,333 | | Total shareholders' equity | $25,605 | $22,229 | | Total liabilities and shareholders' equity | $50,911 | $50,562 | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Condensed Consolidated Statements of Operations and Comprehensive Loss (Amounts in thousands) | Operating Expenses | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $667 | $3,314 | $1,480 | $5,593 | | General and administrative | $2,452 | $2,241 | $5,164 | $4,907 | | Merger-related costs | $0 | $254 | $0 | $1,298 | | Restructuring and other costs | $0 | $1,640 | $0 | $1,640 | | Loss from operations | $(3,119) | $(7,449) | $(6,644) | $(13,438) | | Total other income (expense), net | $1,224 | $(109) | $1,044 | $314 | | Net loss | $(1,895) | $(7,558) | $(5,600) | $(13,124) | | Net loss per share –– basic and diluted | $(0.00) | $(0.00) | $(0.00) | $(0.00) | | Total comprehensive loss | $(2,228) | $(7,546) | $(5,968) | $(12,833) | [Condensed Consolidated Statements of Shareholders' Equity (Deficit)](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Shareholders'%20Equity%20(Deficit)) Condensed Consolidated Statements of Shareholders' Equity (Deficit) (Amounts in thousands) | Item | Balance, Dec 31, 2024 | Issuance of share capital related to financing, net of issuance costs | Stock-based compensation | Foreign currency translation | Net loss | Balance, June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Share Capital $0.0001 par value (Amount) | $5,319 | $457 (Mar 31) + $575 (Jun 30) | — | — | — | $6,523 | | Additional Paid-in Capital | $212,706 | $1,785 (Mar 31) + $3,829 (Jun 30) | $1,015 (Mar 31) + $719 (Jun 30) | — | — | $220,846 | | Capital Redemption Reserve | $52,194 | — | — | — | — | $52,194 | | Accumulated Other Comprehensive Loss | $(738) | — | — | $(35) (Mar 31) + $(333) (Jun 30) | — | $(1,106) | | Accumulated Deficit | $(247,252) | — | — | — | $(3,705) (Mar 31) + $(1,895) (Jun 30) | $(252,852) | | Total Shareholders' Equity | $22,229 | $2,242 (Mar 31) + $4,404 (Jun 30) | $1,015 (Mar 31) + $719 (Jun 30) | $(35) (Mar 31) + $(333) (Jun 30) | $(3,705) (Mar 31) + $(1,895) (Jun 30) | $25,605 | - **Total shareholders' equity increased** from $22,229 thousand at December 31, 2024, to **$25,605 thousand at June 30, 2025**, primarily due to issuance of share capital related to financing and stock-based compensation, partially offset by net loss and foreign currency translation adjustments[24](index=24&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (Amounts in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(5,406) | $(8,938) | | Net cash provided by financing activities | $5,514 | $9,277 | | Effect of exchange rates on cash | $4 | $(7) | | Net change in cash | $112 | $332 | | Cash and restricted cash at beginning of period | $2,659 | $3,845 | | Cash and restricted cash at end of period | $2,771 | $4,177 | - Net cash used in operating activities **decreased by $3,532 thousand** (from $(8,938) thousand in 2024 to $(5,406) thousand in 2025) for the six months ended June 30, primarily due to reduced R&D and restructuring costs[28](index=28&type=chunk)[193](index=193&type=chunk) - Net cash provided by financing activities **decreased by $3,763 thousand** (from $9,277 thousand in 2024 to $5,514 thousand in 2025) for the six months ended June 30, reflecting lower proceeds from share issuances and convertible notes[28](index=28&type=chunk)[198](index=198&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) [Note 1. Description of Business](index=11&type=section&id=Note%201.%20Description%20of%20Business) - Akari Therapeutics, Plc is developing next-generation antibody-drug conjugates (ADCs) through its proprietary technology platform, focusing on novel payloads to target a range of cancers[30](index=30&type=chunk) - The company completed a strategic business combination with Peak Bio, Inc in November 2024, shifting its focus to the ADC platform utilizing a novel anti-cancer payload called PH1[30](index=30&type=chunk)[31](index=31&type=chunk) - Akari has incurred substantial losses and negative cash flows since inception, with an **accumulated deficit of $252.9 million** as of June 30, 2025, raising substantial doubt about its ability to continue as a going concern[37](index=37&type=chunk) [Note 2. Summary of Significant Accounting Policies](index=13&type=section&id=Note%202.%20Summary%20of%20Significant%20Accounting%20Policies) - The unaudited condensed consolidated financial statements are prepared in accordance with U.S GAAP for interim financial information and SEC rules, reflecting management's estimates and assumptions[34](index=34&type=chunk)[35](index=35&type=chunk) - No new accounting pronouncements issued or effective in the first six months of 2025 are expected to have a material impact on the financial statements[40](index=40&type=chunk) [Note 3. Agreement and Plan of Merger](index=13&type=section&id=Note%203.%20Agreement%20and%20Plan%20of%20Merger) - On November 14, 2024, Akari completed the acquisition of Peak Bio, issuing 12,613,942 Akari ADSs to Peak Bio shareholders, representing approximately **48.4% of Akari's outstanding shares** on a fully diluted basis[30](index=30&type=chunk)[41](index=41&type=chunk) Total Consideration Paid for Peak Bio Acquisition (in thousands) | Item | Consideration | | :--- | :--- | | Company ADSs issued to Peak Bio Inc shareholders | $28,129 | | Company ADSs issuable on exercise of November 2022 Peak Investor Warrants and April 2023 Peak Investor Warrants | $1,844 | | Total consideration | $29,973 | Fair Values of Assets Acquired and Liabilities Assumed (in thousands) | Assets Acquired | Amount | | :--- | :--- | | Cash and restricted cash | $382 | | Prepaid expenses and other current assets | $10 | | Acquired in-process research and development | $39,180 | | Total assets acquired | $39,572 | | Liabilities Assumed | Amount | | Accounts payable and accrued expenses | $6,979 | | Convertible notes | $700 | | Notes payable | $659 | | Notes payable, related party | $1,651 | | Deferred tax liability | $8,040 | | Total liabilities assumed | $18,029 | | Goodwill | $8,430 | | Net assets acquired | $29,973 | - The acquisition resulted in the recognition of **$39.2 million in IPR&D intangible assets** (AKTX-101: $34.0 million, PHP-303: $5.18 million) and **$8.4 million in goodwill**[48](index=48&type=chunk)[50](index=50&type=chunk) [Note 4. Fair Value Measurements](index=16&type=section&id=Note%204.%20Fair%20Value%20Measurements) Fair Value of Warrant Liabilities (in thousands) | Warrant Liability | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | November 2022 Peak Warrants | $63 | $95 | | April 2023 Peak Warrants | $689 | $736 | | September 2022 Series B Warrants | $114 | $181 | | Total liabilities | $866 | $1,012 | - The fair value of warrant liabilities **decreased from $1,012 thousand** at December 31, 2024, to **$866 thousand at June 30, 2025**, primarily due to a decrease in the Company's stock price during the reporting period[53](index=53&type=chunk)[164](index=164&type=chunk) - All liability-classified warrants (November 2022 Peak, April 2023 Peak, and September 2022 Series B) are **Level 3 measurements**, determined using the Black-Scholes Option Pricing Model with unobservable inputs[53](index=53&type=chunk)[55](index=55&type=chunk) [Note 5. Accrued Expenses](index=17&type=section&id=Note%205.%20Accrued%20Expenses) Accrued Expenses (in thousands) | Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Employee compensation and benefits | $775 | $473 | | External research and development expenses | $134 | $178 | | Professional and consulting fees | $1,249 | $1,305 | | Restructuring | $50 | $450 | | Other | $260 | $731 | | Total accrued expenses | $2,468 | $3,137 | - Total accrued expenses **decreased from $3,137 thousand** at December 31, 2024, to **$2,468 thousand at June 30, 2025**, driven by reductions in restructuring accruals and other liabilities[57](index=57&type=chunk) [Note 6. Convertible Notes and Notes Payable](index=17&type=section&id=Note%206.%20Convertible%20Notes%20and%20Notes%20Payable) - The Company assumed several notes from Peak Bio in November 2024, including the September 2024 Note ($0.2 million outstanding at June 30, 2025) and the April 2023 Convertible Notes (**$0.7 million outstanding and in default** at June 30, 2025)[58](index=58&type=chunk)[59](index=59&type=chunk)[63](index=63&type=chunk) - The November 2023 Note ($0.4 million principal) was settled for $325,000 on March 6, 2025, resulting in a gain on debt extinguishment[60](index=60&type=chunk)[61](index=61&type=chunk) [Note 7. Shareholders' Equity (Deficit)](index=19&type=section&id=Note%207.%20Shareholders'%20Equity%20(Deficit)) - Shareholders approved an increase in authorized ordinary shares to 330,854,276,210 as of June 30, 2025[67](index=67&type=chunk) - In March and April 2025, the Company completed a private placement, issuing 4,942,626 ADSs (or pre-funded warrants) and various Series A and Series B warrants, generating approximately **$5.6 million in net proceeds** (net of $1.0 million note termination)[69](index=69&type=chunk)[71](index=71&type=chunk)[72](index=72&type=chunk) Outstanding Warrant ADSs | Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Equity-classified Warrants | 23,253,769 | 6,788,070 | | Liability-classified Warrants | 3,284,272 | 3,519,566 | | Total outstanding warrants | 26,538,041 | 10,307,636 | - Total outstanding warrants **increased significantly from 10,307,636** at December 31, 2024, to **26,538,041 at June 30, 2025**, primarily due to new issuances in the March/April 2025 private placement[75](index=75&type=chunk)[76](index=76&type=chunk) [Note 8. Stock-Based Compensation](index=21&type=section&id=Note%208.%20Stock-Based%20Compensation) Stock Option ADSs Activity (Six Months Ended June 30, 2025) | Item | Number of Stock Option ADSs | Weighted Average Exercise Price per ADS | | :--- | :--- | :--- | | Outstanding at December 31, 2024 | 1,981,982 | $8.21 | | Granted | 5,391,336 | $1.49 | | Forfeited | (87,130) | $26.50 | | Expired | (116,569) | $20.78 | | Outstanding at June 30, 2025 | 7,169,619 | $2.73 | | Exercisable at June 30, 2025 | 1,041,615 | $8.38 | Total Stock-Based Compensation Expense (in thousands) | Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $184 | $13 | $375 | $56 | | General and administrative | $535 | $147 | $1,359 | $400 | | Restructuring and other costs | $0 | $285 | $0 | $285 | | Total stock-based compensation expense | $719 | $445 | $1,734 | $741 | - Total stock-based compensation expense **increased significantly to $1,734 thousand** for the six months ended June 30, 2025, from $741 thousand in the prior year, primarily due to increased grants and non-cash compensation[84](index=84&type=chunk) - As of June 30, 2025, unrecognized compensation cost for unvested stock options was **$5.6 million**, expected to be recognized over a weighted average period of 2.8 years[85](index=85&type=chunk) [Note 9. Net Loss per Share](index=23&type=section&id=Note%209.%20Net%20Loss%20per%20Share) Potential Dilutive Securities Excluded from Diluted Net Loss per Share Calculation | Security Type | As at June 30, 2025 (Ordinary Shares) | As at June 30, 2024 (Ordinary Shares) | | :--- | :--- | :--- | | Stock options | 14,339,239,000 | 351,934,688 | | Restricted stock units | — | 251,823,915 | | Warrants | 49,679,308,000 | 13,191,074,600 | | Convertible notes | 749,192,000 | 1,257,860,000 | | Total | 64,767,739,000 | 15,052,693,203 | - All potential dilutive securities were excluded from diluted net loss per share calculations for both periods due to their **anti-dilutive impact**[86](index=86&type=chunk) [Note 10. Income Taxes](index=23&type=section&id=Note%2010.%20Income%20Taxes) - The Company recorded **no tax expense or benefit** for the three and six months ended June 30, 2025 and 2024, due to expected current year losses and historical losses[87](index=87&type=chunk) - A **full valuation allowance** is maintained against all deferred tax assets as of June 30, 2025, and December 31, 2024, as management has determined that it is not more likely than not that the Company will realize these future tax benefits[87](index=87&type=chunk) [Note 11. Segment Information](index=23&type=section&id=Note%2011.%20Segment%20Information) - The Company operates as a **single operating segment**, with the CEO serving as the Chief Operating Decision Maker (CODM), reviewing consolidated financial information and net loss to allocate resources[88](index=88&type=chunk)[91](index=91&type=chunk) - Akari has **not generated any revenue since inception** and primarily incurs expenses in research and development of pre-clinical product candidates (next-generation precision bifunctional ADCs for cancer) and general and administrative costs[89](index=89&type=chunk) [Note 12. Related Party Transactions](index=24&type=section&id=Note%2012.%20Related%20Party%20Transactions) - Dr Samir Patel, former Interim CEO, received non-cash stock-based compensation (NQSOs) and accrued professional fees for his services[95](index=95&type=chunk)[96](index=96&type=chunk) - The Company assumed notes payable to Dr Hoyoung Huh (Chairman) from the Peak Bio acquisition, including 2021 Notes and a January 2024 Note; **$1.0 million of these notes were cancelled** and extinguished in connection with the March 2025 Private Placement for ordinary shares and warrants[97](index=97&type=chunk)[99](index=99&type=chunk)[101](index=101&type=chunk) - May 2024 Convertible Notes with Dr Ray Prudo and Dr Samir Patel for $1.0 million were partially repaid in cash ($750,000) and partially converted into ADSs ($250,000 principal and accrued interest) in October 2024[103](index=103&type=chunk) [Note 13. Commitments and Contingencies](index=26&type=section&id=Note%2013.%20Commitments%20and%20Contingencies) - The Company leases office and laboratory space on a short-term basis, incurring less than $0.1 million in lease costs for the three and six months ended June 30, 2025[107](index=107&type=chunk)[108](index=108&type=chunk) - Under the Bayer Acquisition Agreement (assumed in November 2024), Akari is committed to pay up to **$23.5 million in development and regulatory milestones** and high single-digit royalties for PHP-303, with no expenses incurred to date[111](index=111&type=chunk)[112](index=112&type=chunk)[114](index=114&type=chunk) - Legal proceedings include a claim for discretionary bonuses from a former Peak Bio employee, and settlements with former consultants totaling $0.4 million, leading to the issuance of 251,822,000 ordinary shares[115](index=115&type=chunk)[116](index=116&type=chunk) - A lawsuit with 'Sabby' Volatility Warrant Master Fund Ltd was settled in May 2025, with Akari agreeing to issue 272,450 ADSs (544,900,000 ordinary shares)[117](index=117&type=chunk) - The Company recognized a **$1.2 million gain on settlement** of current liabilities with a former vendor during the six months ended June 30, 2025[118](index=118&type=chunk)[161](index=161&type=chunk) [Note 14. Restructuring](index=27&type=section&id=Note%2014.%20Restructuring) - In May 2024, the Company implemented a reduction-in-force (RIF) of approximately **67% of its workforce** and suspended the nomacopan HSCT-TMA program, completing the restructuring plan in Q3 2024[120](index=120&type=chunk) Restructuring Reserve and Activity (in thousands) | Category | Balance at Dec 31, 2024 | Restructuring adjustment | Cash payments | Balance at June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | | Severance and Employee Benefit Costs | $450 | $(50) | $(350) | $50 | [Note 15. Subsequent Events](index=28&type=section&id=Note%2015.%20Subsequent%20Events) - In August 2025, the Company entered into Note Purchase Agreements with certain investors and directors for a private placement of unsecured promissory notes totaling **$3 million** (aggregate principal $3.8 million), with a 20% original issuance discount, expected to close in two tranches in August and September 2025[122](index=122&type=chunk)[217](index=217&type=chunk) - The Chairman, Dr Hoyoung Huh, agreed to purchase a $1.25 million note for $1.0 million, satisfied by cancelling $837,433 of outstanding debt and $162,567 in cash[122](index=122&type=chunk)[217](index=217&type=chunk) - Series A Warrants previously issued in the March 2025 Private Placement will have their expiration date extended from 2026 to 2030 for certain August 2025 Note Investors[122](index=122&type=chunk)[217](index=217&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on Akari's financial condition and operational results, highlighting the strategic shift to an ADC platform and recent financing activities [Overview](index=29&type=section&id=Overview) - Akari is an oncology company focused on developing next-generation antibody-drug conjugates (ADCs) using novel proprietary cancer-killing toxins (payloads), aiming to improve efficacy and safety[125](index=125&type=chunk) - The lead product candidate, AKTX-101, is a pre-clinical stage Trop2-targeting ADC combining the novel PH1 payload (spliceosome modulator) with the Trop2 antibody, targeting various solid tumors[127](index=127&type=chunk) - Following the Peak Bio acquisition in November 2024, Akari has **suspended internal development of legacy programs** (nomacopan and PAS-nomacopan) and PHP-303, focusing efforts on the ADC platform and seeking external partners for legacy assets[130](index=130&type=chunk) [Recent Developments](index=30&type=section&id=Recent%20Developments) - In August 2025, the Company entered into Note Purchase Agreements for a private placement of unsecured promissory notes totaling **$3 million** (aggregate principal $3.8 million), with a 20% original issuance discount[133](index=133&type=chunk) - Mr Abizer Gaslightwala was appointed President and Chief Executive Officer, effective April 21, 2025, with compensation including base salary, annual cash bonus, and share-based payments[135](index=135&type=chunk) - The March 2025 Private Placement generated approximately **$5.6 million in net proceeds**, involving the issuance of ADSs, pre-funded warrants, and Series A and B warrants[136](index=136&type=chunk)[139](index=139&type=chunk) - The Company completed a portfolio prioritization review in May 2024, suspending the nomacopan HSCT-TMA program and pre-clinical PAS-nomacopan program to focus on Peak Bio's ADC platform technology[140](index=140&type=chunk) - A reduction-in-force (RIF) of approximately **67% of the total workforce** was implemented in May 2024 as part of an operational restructuring plan[141](index=141&type=chunk) [Results of Operations](index=33&type=section&id=Results%20of%20Operations) Operating Expenses and Net Loss (in thousands) | Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $667 | $3,314 | $1,480 | $5,593 | | General and administrative | $2,452 | $2,241 | $5,164 | $4,907 | | Merger-related costs | $0 | $254 | $0 | $1,298 | | Restructuring and other costs | $0 | $1,640 | $0 | $1,640 | | Total operating expenses | $3,119 | $7,449 | $6,644 | $13,438 | | Loss from operations | $(3,119) | $(7,449) | $(6,644) | $(13,438) | | Net loss | $(1,895) | $(7,558) | $(5,600) | $(13,124) | - **Loss from operations decreased by 58%** to $3.1 million for Q2 2025 (from $7.4 million in Q2 2024) and by **51% to $6.6 million** for H1 2025 (from $13.4 million in H1 2024)[144](index=144&type=chunk) - **Research and development expenses decreased by 80%** ($2.6 million) for Q2 2025 and **74%** ($4.1 million) for H1 2025, primarily due to the suspension of legacy programs (nomacopan and PHP-303) and prioritization of the ADC platform[146](index=146&type=chunk) - General and administrative costs increased by 9% ($0.2 million) for Q2 2025 and 5% ($0.3 million) for H1 2025, mainly due to higher non-cash stock-based compensation, partially offset by lower insurance premiums and cash-based salaries[153](index=153&type=chunk)[154](index=154&type=chunk) - Merger-related costs and restructuring costs were zero for Q2 and H1 2025, compared to $0.3 million and $1.6 million respectively in Q2 2024, reflecting the completion of the merger and restructuring activities[155](index=155&type=chunk)[156](index=156&type=chunk) - A **gain on settlement of current liabilities of $1.2 million** was recognized in both Q2 and H1 2025, primarily from a settlement with a former vendor and a debt extinguishment[160](index=160&type=chunk)[161](index=161&type=chunk) - **Net loss decreased to $1.9 million** for Q2 2025 (from $7.6 million in Q2 2024) and to **$5.6 million** for H1 2025 (from $13.1 million in H1 2024)[168](index=168&type=chunk) [Financial Condition, Liquidity and Capital Resources](index=37&type=section&id=Financial%20Condition,%20Liquidity%20and%20Capital%20Resources) - As of June 30, 2025, the Company had **$2.7 million in cash** and an **accumulated deficit of $252.9 million**, with existing cash and committed funds from the August 2025 Financing sufficient to fund operations only into October 2025[170](index=170&type=chunk)[187](index=187&type=chunk) - The Company has incurred substantial losses and negative cash flows since inception and will require significant additional financing to fund future operations, raising **substantial doubt about its ability to continue as a going concern**[170](index=170&type=chunk)[172](index=172&type=chunk)[191](index=191&type=chunk) - Future capital requirements depend on factors such as R&D progress, merger integration costs, clinical trial scope, revenues from licensing, operational infrastructure expansion, regulatory approval costs, and intellectual property protection[171](index=171&type=chunk)[173](index=173&type=chunk) - **Net cash used in operating activities decreased to $(5.4) million** for the six months ended June 30, 2025, from $(8.9) million in the prior year, primarily due to reduced R&D and restructuring costs[193](index=193&type=chunk) - **Net cash provided by financing activities was $5.5 million** for the six months ended June 30, 2025, primarily from the March 2025 Private Placement ($5.9 million net proceeds) and pre-funded warrants ($0.3 million), offset by debt repayments[198](index=198&type=chunk) - Debt obligations assumed from the Peak Bio Merger are expected to result in approximately **$1.6 million in principal payments** as of June 30, 2025[196](index=196&type=chunk) [Critical Accounting Estimates](index=43&type=section&id=Critical%20Accounting%20Estimates) - Key critical accounting estimates include stock-based compensation, fair value of warrants classified as liabilities, research and development prepayments/accruals, income taxes, and intangible assets impairment[199](index=199&type=chunk) - There have been **no material changes** to critical accounting policies and estimates since December 31, 2024[200](index=200&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=43&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Akari Therapeutics, Plc is not required to provide detailed quantitative and qualitative disclosures about market risk - Akari Therapeutics, Plc is a **smaller reporting company** and is exempt from providing detailed quantitative and qualitative disclosures about market risk[201](index=201&type=chunk) [Item 4. Controls and Procedures](index=44&type=section&id=Item%204.%20Controls%20and%20Procedures) This section addresses the effectiveness of Akari's disclosure controls and procedures, noting that material weaknesses identified in the previous annual report persist - Management concluded that internal control over financial reporting was **not effective** as of December 31, 2024, due to material weaknesses, and disclosure controls and procedures were not effective as of June 30, 2025[203](index=203&type=chunk)[205](index=205&type=chunk) - Remediation efforts to address the material weaknesses have not yet commenced but are expected to begin in Q3 2025 and continue through fiscal year 2025[204](index=204&type=chunk)[206](index=206&type=chunk) - No changes in internal control over financial reporting occurred during the fiscal quarter ended June 30, 2025, that materially affected or are reasonably likely to materially affect internal control over financial reporting[208](index=208&type=chunk) [PART II OTHER INFORMATION](index=45&type=section&id=PART%20II%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=45&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to the legal proceedings detailed in the notes to the financial statements, indicating routine litigation may arise from normal business operations - The Company may become involved in routine litigation related to claims arising out of normal business operations[210](index=210&type=chunk) - Specific legal proceedings and settlements are detailed in Note 13 of the financial statements[210](index=210&type=chunk) [Item 1A. Risk Factors](index=45&type=section&id=Item%201A.%20Risk%20Factors) This section advises investors to consider the risks outlined in the company's Annual Report on Form 10-K, noting no material changes to these risk factors - Investing in Akari's securities involves a **high degree of risk**, and investors should review the risk factors in the Annual Report on Form 10-K[211](index=211&type=chunk) - There have been **no material changes** to the risk factors previously disclosed in the Form 10-K[212](index=212&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=45&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section states there were no unregistered sales of equity securities during the period other than those previously disclosed in a Current Report on Form 8-K - No unregistered sales of equity securities occurred during the three and six months ended June 30, 2025, beyond those previously reported in a Form 8-K[213](index=213&type=chunk) [Item 3. Defaults Upon Senior Securities](index=45&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section confirms that there were no defaults upon senior securities during the reporting period - There were **no defaults** upon senior securities[214](index=214&type=chunk) [Item 4. Mine Safety Disclosures](index=45&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section states that there are no mine safety disclosures to report - No mine safety disclosures are applicable or required[215](index=215&type=chunk) [Item 5. Other Information](index=45&type=section&id=Item%205.%20Other%20Information) This section details the August 2025 Financing, including the issuance of unsecured promissory notes and the amendment of Series A Warrants - No directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the fiscal quarter[216](index=216&type=chunk) - In August 2025, the Company entered into Note Purchase Agreements for a private placement of unsecured promissory notes totaling approximately **$3 million** (aggregate principal $3.8 million), with a 20% original issuance discount[217](index=217&type=chunk) - The Chairman, Dr Hoyoung Huh, purchased a $1.25 million note for $1.0 million, satisfied by cancelling $837,433 of outstanding debt and $162,567 in cash[217](index=217&type=chunk) - Series A Warrants from the March 2025 Private Placement will have their expiration date **extended from 2026 to 2030** for certain August 2025 Note Investors[217](index=217&type=chunk) [Item 6. Exhibits](index=47&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Quarterly Report on Form 10-Q, including merger agreements, incentive plan amendments, and certifications - Exhibits include the Agreement and Plan of Merger, Amendment No 2 to the 2023 Equity Incentive Plan, Form of August 2025 Note Purchase Agreement, Form of 20% Original Issue Discount Promissory Note, Form of Amendment No 1 to Series A Warrant, and various certifications[221](index=221&type=chunk) [SIGNATURES](index=48&type=section&id=SIGNATURES) - The report is signed by Abizer Gaslightwala, President and Chief Executive Officer, and Torsten Hombeck, Ph.D, Chief Financial Officer, on August 13, 2025[225](index=225&type=chunk)

Core Insights - Akari Therapeutics is focused on developing novel immuno-oncology payload antibody drug conjugates (ADCs) for cancer treatment [2][4] - The company’s lead candidate, AKTX-101, utilizes a novel spliceosome modulator payload, PH1, which has shown significant preclinical activity [4] Company Overview - Akari Therapeutics is an oncology biotechnology company that has developed PH1, a spliceosome modulator designed to disrupt RNA splicing within cancer cells [4] - PH1 is differentiated from traditional ADC payloads that typically use Topoisomerase1 inhibitors or tubulin inhibitors, and it has demonstrated the ability to induce cancer cell death while activating immune cells [4] - AKTX-101 targets the Trop2 receptor on cancer cells, delivering the PH1 payload directly into tumors, and has shown prolonged survival in preclinical studies compared to traditional ADCs [4] Research and Development - The company is conducting ongoing research to further understand the effects of PH1 and its potential to disrupt key drivers of cancer cell growth [3][4] - Akari is generating validating data on PH1 to advance its lead asset and explore other undisclosed targets [4]

Core Insights - Akari Therapeutics is advancing its research on PH1, a novel spliceosome modulator that induces cancer cell death and activates the immune system to combat cancer [1][4] - The company is focused on developing antibody drug conjugates (ADCs) utilizing the PH1 payload, with ongoing preclinical studies expected to yield new data by year-end [1][3] Company Overview - Akari Therapeutics specializes in oncology biotechnology, developing innovative ADCs with a unique mechanism of action through the PH1 payload, which disrupts RNA splicing [4] - The lead candidate, AKTX-101, targets the Trop2 receptor and has shown significant activity and prolonged survival in preclinical studies compared to traditional ADCs [4] Research and Development - Ongoing research aims to explore the effects of PH1 on key oncogenic drivers such as KRAS, BRAF, and FGFR3, with preliminary data anticipated soon [2][3] - The PH1 payload has demonstrated the ability to induce cytotoxicity in cancer cells and activate immune responses, potentially leading to improved therapeutic outcomes [2][6]

Company Overview - Akari Therapeutics is an oncology biotechnology company focused on developing novel immuno-oncology payload antibody drug conjugates (ADCs) for cancer treatment [1][3] - The company has developed its first novel payload, PH1, which is a spliceosome inhibitor designed to disrupt RNA splicing within cells [3] - PH1 is differentiated from current ADC payloads that utilize Topoisomerase1 inhibitors or tubulin inhibitors, showing potential to induce cancer cell death while activating immune cells [3] Lead Candidate - Akari's lead candidate, AKTX-101, targets the Trop2 receptor on cancer cells and delivers the PH1 payload directly into tumors [3] - In preclinical studies, AKTX-101 has demonstrated significant activity and prolonged survival compared to traditional ADCs [3] - The candidate has potential synergistic effects with checkpoint inhibitors, showing prolonged survival both as a single agent and in combination with these inhibitors [3] Recent Developments - Abizer Gaslightwala, the CEO of Akari, participated in the Virtual Investor "What's Your Story" Summer Spotlight On-Demand Conference, discussing his dedication to the company and its programs [1][2] - The on-demand video webcast of the conference is available on virtualinvestorco.com and the company's website [2]

Akari Therapeutics Overview - Akari Therapeutics focuses on innovating antibody-drug conjugates (ADCs) as immuno-oncology therapies [3] - The company's lead payload, PH1, is a spliceosome inhibitor that causes cell death and activates the immune system [10] - Akari is developing novel target ADCs with the PH1 payload applicable to colon, lung, breast, and prostate cancers [12] PH1 Payload Mechanism and Advantages - PH1's mechanism of action generates mis-spliced transcripts leading to immunogenic neoantigens, 9 times greater than DM4 [23, 25] - PH1 overcomes resistance mechanisms and has reduced off-target toxicity due to its linker being engineered for intracellular release [17] - Preclinical data shows synergy between PH1 payload ADCs and checkpoint inhibitors [16] ADC Pipeline and Development - Akari's proprietary PH1 payload can build an entire ADC pipeline, with the ability to design several uniquely targeted ADCs in parallel [33] - AKTX-101 (Trop2 target) is ready for GMP manufacturing/GLP tox studies [36] - AKTX-102 is being developed against a novel target with potential in lung, colon, and breast cancers [36] Market Opportunity and Deal Flow - There is a strong need for ADCs with new payload mechanisms beyond current ADC therapies, especially in lung cancer [13] - Early-stage ADC deal flow shows continued momentum, with deals ranging from $20 million to $400 million upfront and total deal highlights reaching up to $1.34 billion [8] - One licensing deal for EO-1022 (HER3) reached $368 million in upfront and clinical, regulatory, and commercial milestone payments [8]

Company Overview - Akari Therapeutics is an oncology biotechnology company focused on developing novel immuno-oncology payload antibody drug conjugates (ADCs) for cancer treatment [2][4] - The company has developed its first novel payload, PH1, which is a spliceosome inhibitor designed to disrupt RNA splicing within cells, differentiating it from current ADC payloads [4] Recent Developments - Akari Therapeutics recently participated in a Virtual Investor segment where CEO Abizer Gaslightwala discussed the issuance of India Patent No. 562,919 for "Thailanstatin Analogs," which covers claims for its PH1 payload and ADC technology [3] - The PH1 payload has shown significant activity in preclinical studies, inducing cancer cell death and activating immune cells, leading to robust and durable activity [4] Product Pipeline - The lead candidate, AKTX-101, targets the Trop2 receptor on cancer cells and utilizes a proprietary linker to deliver the PH1 payload directly into tumors [4] - AKTX-101 has demonstrated significant activity and prolonged survival in preclinical studies compared to traditional ADCs, and it has potential synergistic effects with checkpoint inhibitors [4]

Core Viewpoint - Akari Therapeutics has announced the issuance of a new patent in India for its innovative immuno-oncology payload, PH1, which is designed to inhibit RNA splicing and enhance cancer treatment options as cancer rates rise in the region [1][3]. Company Overview - Akari Therapeutics is focused on developing novel antibody drug conjugates (ADCs) for cancer treatment, with its lead candidate, AKTX-101, targeting the Trop2 receptor on cancer cells [6]. - The company has developed PH1, a spliceosome inhibitor that disrupts RNA splicing, leading to cancer cell death and immune system activation [6]. Patent Details - The newly issued Patent No. 562,919 covers the company's PH1 payload, proprietary linkers, and ADC technology applicable to various cancer targets [2][4]. - This patent strengthens Akari's global intellectual property portfolio and provides additional protection for its manufacturing activities related to PH1 [3]. Market Context - India is identified as a key market for Akari, with cancer cases projected to rise to 2.08 million by 2040, highlighting the increasing need for innovative cancer therapies [1][3]. - The issuance of the patent is seen as a strategic move to capitalize on the growing demand for cancer treatments in India [3]. Research and Development - Akari is advancing a pipeline of potentially first-in-class ADC candidates that have demonstrated significant tumor-killing activity in preclinical models [5]. - The company aims to leverage its innovative payload platform to create multiple ADC molecules targeting a range of cancer types [5].