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HOUSTON, Sept. 09, 2025 (GLOBE NEWSWIRE) -- Salarius Pharmaceuticals, Inc. (Nasdaq: SLRX) (Salarius or the Company) announces that on September 4, 2025 the Company received notification from The Nasdaq Stock Market LLC (Nasdaq) that it has regained compliance with Listing Rule 5550(a)(2), the Minimum Bid Price Requirement. By meeting the Minimum Bid Price Requirement, Salarius has achieved one of the milestones in regaining compliance with all Nasdaq continued listing standards. As previously disclosed on A ...

Core Viewpoint - Salarius Pharmaceuticals, Inc. will implement a 1-for-15 reverse stock split to regain compliance with Nasdaq's minimum closing bid price requirement of $1.00 [2][4]. Group 1: Reverse Stock Split Details - The reverse stock split will take effect at 5:00 p.m. Eastern Time on August 15, 2025, with trading on a split-adjusted basis starting August 18, 2025 [1]. - The number of shares outstanding will decrease from approximately 7.6 million to about 509,000 shares [4]. - All outstanding options and warrants will be adjusted accordingly, and stockholders will receive cash for any fractional shares based on the closing price on August 15, 2025 [4][5]. Group 2: Approval Process - Stockholders approved the reverse stock split proposal at a special meeting on July 8, 2025, allowing the Board of Directors to determine the split ratio [3]. - The specific 1-for-15 ratio was subsequently approved by the Board of Directors [3]. Group 3: Company Overview - Salarius Pharmaceuticals is a clinical-stage biopharmaceutical company focused on developing cancer therapies, with two drug candidates: seclidemstat and SP-3164 [7]. - Seclidemstat is being studied in a Phase 1/2 clinical trial for hematologic cancers, while SP-3164 is an oral small molecule protein degrader [7].

[Special Note Regarding Forward-Looking Statements](index=3&type=section&id=SPECIAL%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section highlights that forward-looking statements are subject to risks and uncertainties, including those related to the proposed merger, going concern status, and Nasdaq compliance - Forward-looking statements involve risks and uncertainties, including the proposed merger with Decoy Therapeutics, the company's ability to continue as a going concern, and Nasdaq listing compliance[8](index=8&type=chunk)[9](index=9&type=chunk)[10](index=10&type=chunk)[11](index=11&type=chunk)[12](index=12&type=chunk)[14](index=14&type=chunk) [PART I. Financial Information](index=5&type=section&id=PART%20I.%20Financial%20Information) This part presents the company's unaudited financial statements, management's discussion, market risk disclosures, and internal controls [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents Salarius Pharmaceuticals' unaudited condensed consolidated financial statements, including balance sheets, operations, cash flows, and equity, with explanatory notes [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the company's financial position, detailing assets, liabilities, and stockholders' equity at specific dates Condensed Consolidated Balance Sheet Highlights | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | Change | | :-------------------------- | :------------------------ | :-------------------------- | :----- | | Cash and cash equivalents | $794,886 | $2,434,528 | $(1,639,642) | | Total current assets | $1,359,578 | $2,987,562 | $(1,627,984) | | Total assets | $1,392,778 | $3,022,974 | $(1,630,196) | | Total liabilities | $2,222,502 | $1,511,279 | $711,223 | | Total stockholders' equity (deficit) | $(829,724) | $1,511,695 | $(2,341,419) | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section outlines the company's financial performance over periods, including research and development, general and administrative expenses, and net loss Condensed Consolidated Statements of Operations Highlights | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Research and development | $116,383 | $214,447 | $191,915 | $457,449 | | General and administrative | $849,182 | $1,253,070 | $2,492,345 | $2,781,683 | | Total operating expenses | $965,565 | $1,467,517 | $2,684,260 | $3,239,132 | | Net loss | $(957,825) | $(1,424,433) | $(2,667,358) | $(3,139,723) | | Loss per common share (basic and diluted) | $(0.45) | $(2.37) | $(1.41) | $(5.62) | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section details the cash inflows and outflows from operating, investing, and financing activities over specific periods Condensed Consolidated Statements of Cash Flows Highlights | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(2,044,011) | $(2,426,147) | | Net cash provided by (used in) financing activities | $404,369 | $(200,940) | | Net decrease in cash and cash equivalents | $(1,639,642) | $(2,627,087) | | Cash and cash equivalents at end of period | $794,886 | $3,272,823 | [Condensed Consolidated Statements of Stockholders' Equity (Deficit)](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity%20%28Deficit%29) This section tracks changes in the company's stockholders' equity, including common stock, additional paid-in capital, and accumulated deficit Stockholders' Equity (Deficit) Changes | Metric | December 31, 2024 | June 30, 2025 | | :-------------------------- | :---------------- | :-------------- | | Common Stock (Shares) | 1,441,157 | 2,127,286 | | Common Stock (Amount) | $144 | $213 | | Additional Paid-In Capital | $83,435,169 | $83,761,039 | | Accumulated Deficit | $(81,923,618) | $(84,590,976) | | Total Stockholders' Equity (Deficit) | $1,511,695 | $(829,724) | - A **1-for-8 reverse stock split** was effected on June 14, 2024, and all historical share and per share amounts have been retroactively adjusted[33](index=33&type=chunk)[34](index=34&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed explanations and additional information supporting the condensed consolidated financial statements [NOTE 1. Organization and Operations](index=9&type=section&id=NOTE%201.%20ORGANIZATION%20AND%20OPERATIONS) This note describes Salarius's business as a clinical-stage biopharmaceutical company, its proposed merger with Decoy Therapeutics, and going concern uncertainties - Salarius is a clinical-stage biopharmaceutical company developing two small molecule drugs: **SP-3164** (targeted protein degrader) and **seclidemstat (SP-2577)** (targeted protein inhibitor) for cancer treatment[29](index=29&type=chunk) - The company entered into a Merger Agreement with Decoy Therapeutics Inc. on **January 10, 2025**, to combine operations[30](index=30&type=chunk) - Substantial doubt exists about the company's ability to continue as a going concern due to recurring losses and no product revenue, requiring additional capital or potential dissolution if the merger is not consummated[31](index=31&type=chunk)[32](index=32&type=chunk) - A **1-for-8 reverse stock split** was effected on June 14, 2024, retroactively adjusting all historical share and per share amounts[33](index=33&type=chunk)[34](index=34&type=chunk) [NOTE 2. Basis of Presentation and Significant Accounting Policies](index=10&type=section&id=NOTE%202.%20BASIS%20OF%20PRESENTATION%20AND%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines the basis for preparing the financial statements and the key accounting policies applied, including estimates and revenue recognition - Unaudited condensed consolidated financial statements are prepared in conformity with GAAP and SEC rules for interim financial information, not including all disclosures required for complete annual statements[35](index=35&type=chunk)[37](index=37&type=chunk) - Key accounting policies include consolidating wholly-owned subsidiaries, using estimates, classifying highly liquid investments with original maturities of three months or less as cash equivalents, and assessing warrants for liability or equity classification[36](index=36&type=chunk)[38](index=38&type=chunk)[39](index=39&type=chunk)[41](index=41&type=chunk) - Research and development costs are expensed as incurred, and equity-based compensation is measured at grant date fair value and recognized over the vesting period using the Black-Scholes model[43](index=43&type=chunk)[44](index=44&type=chunk)[45](index=45&type=chunk) - Basic and diluted net loss per share are the same due to the company's loss position, and a full valuation allowance is established against net deferred tax assets due to uncertainty of realization[46](index=46&type=chunk)[48](index=48&type=chunk) [NOTE 3. Prepaid Expenses and Other Current Assets](index=13&type=section&id=NOTE%203.%20PREPAID%20EXPENSES%20AND%20OTHER%20CURRENT%20ASSETS) This note details the composition of prepaid expenses and other current assets, including insurance and deferred offering costs Prepaid Expenses and Other Current Assets | Category | June 30, 2025 | December 31, 2024 | | :------------------------------ | :-------------- | :---------------- | | Insurance | $28,310 | $287,785 | | Deferred offering cost | $509,931 | $221,580 | | Other prepaid and current assets | $26,451 | $43,669 | | Total | $564,692 | $553,034 | - The note payable for directors' and officers' insurance, which was **$0.2 million** at December 31, 2024, was **$0 million** at June 30, 2025[50](index=50&type=chunk) [NOTE 4. Commitments and Contingencies](index=13&type=section&id=NOTE%204.%20COMMITMENTS%20AND%20CONTINGENCIES) This note discloses the company's contractual obligations, including a Cancer Research Grant Contract and a license agreement with the University of Utah - The company has a Cancer Research Grant Contract with CPRIT (up to **$16.1 million**, expired 2023) with ongoing revenue-sharing payment obligations on net sales of covered products[51](index=51&type=chunk)[53](index=53&type=chunk) - A 2011 license agreement with the University of Utah grants exclusive rights to LSD1, requiring **2% equity ownership**, revenue sharing on commercial sales, and milestone payments[54](index=54&type=chunk) [NOTE 5. Fair Value of Financial Instruments](index=14&type=section&id=NOTE%205.%20FAIR%20VALUE%20OF%20FINANCIAL%20INSTRUMENTS) This note explains the fair value measurement of financial instruments and the hierarchy used for valuation inputs - Recorded values of financial instruments (cash, accounts payable, notes payable) approximate fair values due to their short-term nature[55](index=55&type=chunk) - Fair value hierarchy uses **Level 1** (quoted prices in active markets), **Level 2** (observable inputs other than Level 1), and **Level 3** (significant unobservable inputs)[60](index=60&type=chunk) [NOTE 6. Stockholders' Equity](index=14&type=section&id=NOTE%206.%20STOCKHOLDERS%27%20EQUITY) This note details changes in stockholders' equity, including common stock sales, warrant activity, and the impact of a reverse stock split - During the six months ended June 30, 2025, the company sold **399,291 shares** of common stock through an ATM offering for **$0.4 million** and **286,772 shares** under an ELOC agreement for **$0.7 million**[56](index=56&type=chunk)[57](index=57&type=chunk) - Outstanding warrants decreased significantly from approximately **1,250,850** at June 30, 2024, to **86,661** at June 30, 2025[64](index=64&type=chunk) - A Series A-1 Common Stock Purchase Warrant for **454,546 shares** was canceled on January 10, 2025, in exchange for **$350,000 cash**[62](index=62&type=chunk)[105](index=105&type=chunk) [NOTE 7. Equity-Based Compensation](index=15&type=section&id=NOTE%207.%20EQUITY-BASED%20COMPENSATION) This note describes the company's equity incentive plan, stock option activity, and unrecognized compensation costs - The 2015 Equity Incentive Plan expired in **January 2025**, with no shares remaining for future awards[66](index=66&type=chunk) Stock Option Activity Highlights | Metric | June 30, 2025 | June 30, 2024 | | :----------------------------------- | :------------ | :------------ | | Stock options granted (6 months) | 0 | 21,125 | | Outstanding at period end (shares) | 31,554 | 31,554 | | Weighted Average Exercise Price (Outstanding) | $66.75 | $66.75 | | Exercisable at period end (shares) | 28,896 | 8,692 | - Unrecognized compensation cost related to unvested stock options was approximately **$0.1 million** as of June 30, 2025, to be recognized over a weighted-average period of **0.35 years**[70](index=70&type=chunk) [NOTE 8. Segment Reporting](index=17&type=section&id=NOTE%208.%20SEGMENT%20REPORTING) This note clarifies that the company operates as a single segment focused on cancer treatment development, with no revenue-generating products - The company operates as one operating and reportable segment, focused on developing cancer treatments with **SP-3164** and **SP-2577**, and has no revenue-generating products[72](index=72&type=chunk)[73](index=73&type=chunk) Segment Expenses and Net Loss | Expense Category | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Research and development: SP-3164 | $8,406 | $125,974 | $29,443 | $212,860 | | Research and development: SP-2577 | $107,977 | $88,473 | $162,472 | $244,589 | | General and administrative: Professional services and Consulting | $515,414 | $764,432 | $1,749,109 | $1,332,897 | | General and administrative: Personnel cost | $180,933 | $247,539 | $432,041 | $1,088,980 | | General and administrative: Facility cost | $152,835 | $241,099 | $311,195 | $359,806 | | Net loss | $957,825 | $1,424,432 | $2,667,358 | $3,139,723 | [NOTE 9. Subsequent Event](index=17&type=section&id=NOTE%209.%20SUBSEQUENT%20EVENT) This note reports events occurring after the balance sheet date, including further equity sales and Nasdaq delisting notices - Subsequent to June 30, 2025, the company issued **5,518,308 shares** of common stock for **$3.8 million** under the ELOC Agreement[75](index=75&type=chunk) - On April 23, 2025, Salarius received a Nasdaq delisting notice for non-compliance with the Minimum Bid Price Requirement (**$1.00 per share**) and the Equity Standard (**$2.5 million** stockholders' equity)[76](index=76&type=chunk)[77](index=77&type=chunk) - Nasdaq granted an extension until **mid-August 2025** for the Equity Standard and **late August 2025** for the Minimum Bid Price Requirement, contingent on achieving scheduled milestones[81](index=81&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, condition, and outlook, emphasizing the clinical-stage focus, recurring losses, capital needs, merger developments, and Nasdaq compliance challenges [Overview](index=19&type=section&id=Overview) This overview describes Salarius as a clinical-stage biopharmaceutical company, its accumulated deficit, and the substantial doubt regarding its going concern ability - Salarius is a clinical-stage biopharmaceutical company focused on developing cancer treatments, with two small molecule drugs in its pipeline: **SP-3164** and **seclidemstat (SP-2577)**[85](index=85&type=chunk) - The company has an accumulated deficit of **$84.6 million** as of June 30, 2025, and has never been profitable, with no product revenue to date[86](index=86&type=chunk) - Substantial doubt exists about the company's ability to continue as a going concern, requiring significant additional capital to fund operations beyond **Q2 2026**; failure to raise capital could lead to cessation of operations[88](index=88&type=chunk)[89](index=89&type=chunk)[91](index=91&type=chunk) - As of the filing date, cash and cash equivalents are approximately **$3.4 million**, and stockholders' equity is above **$2.5 million**, following recent equity sales[86](index=86&type=chunk) [Recent Developments](index=20&type=section&id=Recent%20Developments) This section details recent corporate actions, including equity sales, amendments to the Decoy Therapeutics merger agreement, and Nasdaq delisting notices - In July 2025, Salarius issued **5,463,671 common shares** for **$3.5 million** under the ELOC Agreement, and stockholders approved removing the ELOC Exchange Cap and a reverse stock split[93](index=93&type=chunk)[94](index=94&type=chunk)[95](index=95&type=chunk) - The merger agreement with Decoy Therapeutics has been amended multiple times, resulting in Salarius's legacy stockholders retaining **7.6%** of the combined company (down from **14.1%**) and introducing post-closing anti-dilution price protection for preferred stockholders[96](index=96&type=chunk)[99](index=99&type=chunk)[101](index=101&type=chunk)[102](index=102&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk) - Nasdaq issued delisting notices for non-compliance with the Minimum Bid Price Requirement and the Equity Standard; an appeal was granted, extending compliance deadlines to **mid-August 2025** for Equity Standard and **late August 2025** for Minimum Bid Price Requirement[106](index=106&type=chunk)[107](index=107&type=chunk)[111](index=111&type=chunk) [Results of Operations](index=24&type=section&id=Results%20of%20Operations) This section analyzes the company's operating expenses and net loss, comparing performance across periods and explaining key drivers of change Operating Expenses and Net Loss (YoY Comparison) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | Change ($) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change ($) | | :-------------------------- | :--------------------------- | :--------------------------- | :--------- | :--------------------------- | :--------------------------- | :--------- | | Research and development | $116,383 | $214,447 | $(98,064) | $191,915 | $457,449 | $(265,534) | | General and administrative | $849,182 | $1,253,070 | $(403,888) | $2,492,345 | $2,781,683 | $(289,338) | | Net loss | $(957,825) | $(1,424,433) | $(466,608) | $(2,667,358) | $(3,139,723) | $(472,365) | - The decrease in R&D expenses is primarily due to a cost-savings plan implemented in **Q3 2023**, including a significant reduction in operating personnel and curtailment of sponsored clinical trials[115](index=115&type=chunk)[120](index=120&type=chunk) - G&A expenses decreased due to lower personnel, insurance, and facility costs, partially offset by higher professional expenses related to the merger[117](index=117&type=chunk)[122](index=122&type=chunk)[123](index=123&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's cash position, capital needs, and ability to fund operations, highlighting the going concern risk - The company has an accumulated deficit of **$84.6 million** as of June 30, 2025, and has never generated revenue from product sales[125](index=125&type=chunk) Cash Flow Summary | Cash Flow Category | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :----------------------------- | :----------------------------- | | Operating activities | $(2,044,011) | $(2,426,147) | | Financing activities | $404,369 | $(200,940) | | Net decrease in cash | $(1,639,642) | $(2,627,087) | - Cash and cash equivalents were **$0.8 million** at June 30, 2025, but increased to approximately **$3.4 million** as of the report date due to **$3.8 million** in July 2025 ELOC sales, expected to fund operations into **Q2 2026**[127](index=127&type=chunk)[128](index=128&type=chunk) - Substantial doubt about the company's ability to continue as a going concern persists, and failure to close the merger or secure additional capital could lead to a wind-down of operations[126](index=126&type=chunk)[128](index=128&type=chunk) [Critical Accounting Policies and Estimates](index=27&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section discusses the significant judgments and assumptions management uses in preparing the financial statements - Financial statements require management estimates and assumptions in accordance with GAAP[132](index=132&type=chunk) - No material changes to critical accounting policies have occurred since the Annual Report on Form 10-K filed on **March 21, 2025**[133](index=133&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=27&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a smaller reporting company, Salarius Pharmaceuticals is not required to provide quantitative and qualitative disclosures about market risk - The company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[134](index=134&type=chunk) [Item 4. Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures) Management evaluated the effectiveness of disclosure controls and procedures, concluding they were effective, with no significant changes in internal control over financial reporting [Evaluation of Disclosure Controls and Procedures](index=28&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section confirms the effectiveness of the company's disclosure controls and procedures as of the reporting date - Disclosure controls and procedures were evaluated as **effective** at a reasonable assurance level as of **June 30, 2025**[136](index=136&type=chunk) [Changes in Internal Control over Financial Reporting](index=28&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) This section reports that no significant changes in internal control over financial reporting occurred during the period - No significant changes in internal control over financial reporting occurred during the three months ended **June 30, 2025**[137](index=137&type=chunk) [PART II. Other Information](index=28&type=section&id=PART%20II.%20Other%20Information) This part includes disclosures on legal proceedings, risk factors, equity sales, defaults, and exhibits [Item 1. Legal Proceedings](index=28&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any material legal proceedings but may become involved in ordinary course business litigation in the future - The company is not a party to any material legal proceedings as of the report date[139](index=139&type=chunk) [Item 1A. Risk Factors](index=28&type=section&id=Item%201A.%20Risk%20Factors) This section highlights risks including potential dissolution if the Decoy Therapeutics merger and financing fail, and Nasdaq delisting due to non-compliance with minimum bid price and equity standards - Failure to complete the Qualified Financing and the merger with Decoy Therapeutics in the near term would likely lead to Salarius's dissolution and liquidation, with no assurances of distributions to stockholders[141](index=141&type=chunk)[143](index=143&type=chunk)[145](index=145&type=chunk)[146](index=146&type=chunk) - The company's common stock is subject to delisting from Nasdaq due to non-compliance with the minimum bid price and stockholders' equity requirements, which would seriously harm liquidity and ability to raise capital[150](index=150&type=chunk)[151](index=151&type=chunk)[152](index=152&type=chunk) - Delisting could result in trading on less recognized markets (e.g., 'Pink Sheets'), reduced liquidity, lower market price, and limited access to capital, potentially leading to a 'penny stock' designation[157](index=157&type=chunk)[158](index=158&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities or use of proceeds to report in this period - No unregistered sales of equity securities or use of proceeds to report[159](index=159&type=chunk) [Item 3. Defaults Upon Senior Securities](index=31&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities to report in this period - No defaults upon senior securities to report[159](index=159&type=chunk) [Item 4. Mine Safety Disclosures](index=31&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Mine Safety Disclosures are not applicable to the company[160](index=160&type=chunk) [Item 5. Other Information](index=31&type=section&id=Item%205.%20Other%20Information) No other information is reported under this item - No other information to report[161](index=161&type=chunk) [Item 6. Exhibits](index=33&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including merger agreement amendments, corporate documents, certifications, and XBRL data - Exhibits include multiple amendments to the Agreement and Plan of Merger with Decoy Therapeutics, corporate organizational documents, certifications (e.g., SOX 302, 906), and XBRL financial data[163](index=163&type=chunk) [SIGNATURES](index=36&type=section&id=SIGNATURES) This section provides the official signatures of the company's principal executive and financial officers, certifying the report - The report was signed by David J. Arthur (President and CEO) and Mark J. Rosenblum (CFO and EVP of Finance) on **August 12, 2025**[169](index=169&type=chunk)

HOUSTON, July 14, 2025 (GLOBE NEWSWIRE) -- Salarius Pharmaceuticals, Inc. (Nasdaq: SLRX) (Salarius or the Company) announces that on July 10, 2025 the Company received notification from The Nasdaq Stock Market LLC (Nasdaq) of an additional extension to regain compliance with Nasdaq Listing Rule 5550(b)(1) (Equity Standard) by late July 2025. As previously disclosed, Salarius must also regain compliance with Nasdaq Listing Rule 5550(a)(2) (Minimum Bid Price Requirement) by early August 2025. About the Planne ...

Core Insights - Salarius Pharmaceuticals is advancing its Phase 1/2 clinical study of seclidemstat for myelodysplastic syndrome (MDS) and chronic myelomonocytic leukemia (CMML) with updates expected later this year [1][2] - The company is progressing with its planned merger with Decoy Therapeutics, which is anticipated to create value through Decoy's innovative peptide conjugate therapeutics platform [2][3] Company Developments - Salarius' seclidemstat is a first-in-class, orally bioavailable LSD1 inhibitor being evaluated at MD Anderson Cancer Center [1][9] - The merger with Decoy Therapeutics is set to create a new entity named Decoy Therapeutics, with Decoy investors expected to own approximately 92.4% of the merged company [2][10] - The combined company will focus on developing peptide conjugate therapeutics for unmet medical needs in respiratory infectious diseases and gastroenterology oncology [3][8] Research Insights - Recent animal studies published highlight the importance of inhibiting LSD1 expression, supporting the potential of SP-2577 in cancer treatment [2][5] - The studies provide insights into the role of KDM1A in regulating neural stem cell fate and its implications in oral squamous cell carcinoma progression [5][6] Future Plans - Decoy Therapeutics plans to advance its lead asset, a pan-coronavirus antiviral, towards an Investigational New Drug (IND) application with the FDA within the next 12 months [6][7] - The ongoing clinical trial at MDACC is expected to report data on patients with MDS and CMML who have previously failed or relapsed after hypomethylating agent therapy [7][9]

Core Insights - Salarius Pharmaceuticals is advancing its Phase 1/2 clinical study of seclidemstat for myelodysplastic syndrome (MDS) and chronic myelomonocytic leukemia (CMML) with updates expected later this year [1][2] - The company is progressing with its planned merger with Decoy Therapeutics, which is anticipated to create value through Decoy's innovative peptide conjugate therapeutics [2][3] Company Developments - Salarius' seclidemstat is a first-in-class, orally bioavailable LSD1 inhibitor being evaluated at MD Anderson Cancer Center [1][9] - The merger with Decoy Therapeutics is set to combine Salarius' drug candidates with Decoy's IMPACT™ platform, which focuses on developing therapeutics for respiratory viruses and cancer [3][10] - The combined company will be led by Decoy's executive team, including CEO Frederick "Rick" Pierce and CSO Barbara Hibner [4] Research Insights - Two recent animal studies highlight the importance of inhibiting LSD1 expression, supporting the potential of SP-2577 in cancer treatment [2][5] - The studies published in peer-reviewed journals provide insights into the role of KDM1A in regulating neural stem cells and oral squamous cell carcinoma progression [5] Future Plans - Decoy plans to advance its lead asset, a pan-coronavirus antiviral, towards an Investigational New Drug (IND) application with the FDA within the next 12 months [6] - The ongoing clinical trial at MDACC may yield data on MDS and CMML patients who have previously failed or relapsed after hypomethylating agent therapy [7]

[PART I. Financial Information](index=5&type=section&id=PART%20I.%20Financial%20Information) [Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The company reported a $1.7 million net loss and a severe decline in stockholders' equity, raising substantial doubt about its going concern status [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The company's balance sheet reflects a sharp deterioration in financial health, with total assets decreasing and liabilities increasing significantly Condensed Consolidated Balance Sheet Highlights (Unaudited) | Balance Sheet Item | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $1,798,380 | $2,434,528 | | Total current assets | $2,305,086 | $2,987,562 | | Total assets | $2,339,392 | $3,022,974 | | Total liabilities | $2,277,526 | $1,511,279 | | Total stockholders' equity | $61,866 | $1,511,695 | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company's net loss remained stable at $1.7 million as decreased R&D expenses were offset by higher G&A costs Three Months Ended March 31 (Unaudited) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Research and development | $75,532 | $243,002 | | General and administrative | $1,643,163 | $1,528,613 | | Total operating expenses | $1,718,695 | $1,771,615 | | Net loss | $(1,709,533) | $(1,715,290) | | Loss per common share | $(1.03) | $(3.27) | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operations decreased, and financing activities provided cash, resulting in a smaller net decrease in cash reserves Cash Flow Summary for Three Months Ended March 31 (Unaudited) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(1,181,714) | $(1,353,955) | | Net cash (used in) provided by financing activities | $545,566 | $(172,750) | | Net decrease in cash and cash equivalents | $(636,148) | $(1,526,705) | | Cash, cash equivalents at end of period | $1,798,380 | $4,373,205 | [Condensed Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Stockholders' equity collapsed to just $61,866 due to a significant net loss that outpaced funds raised from equity issuance - The company's **total stockholders' equity decreased to $61,866** as of March 31, 2025, down from $1,511,695 at December 31, 2024[25](index=25&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes highlight substantial going concern doubt, a pending merger with Decoy Therapeutics, and recent Nasdaq delisting notices - The company has entered into a merger agreement with Decoy Therapeutics, which is contingent upon certain conditions, including a **Qualified Financing of at least $6.0 million**[32](index=32&type=chunk)[96](index=96&type=chunk)[98](index=98&type=chunk) - Management has concluded there is **substantial doubt about the company's ability to continue as a going concern**, as existing cash is insufficient to fund operations for one year[33](index=33&type=chunk)[34](index=34&type=chunk) - In March and April 2025, the company received **delisting notices from Nasdaq** for failing to meet the minimum stockholders' equity requirement of $2.5 million and the minimum bid price of $1.00 per share[83](index=83&type=chunk)[84](index=84&type=chunk)[86](index=86&type=chunk) - During Q1 2025, the company sold common stock through an "at the market offering" (ATM) for gross proceeds of $0.4 million and under an Equity Line of Credit (ELOC) agreement for proceeds of $0.7 million[63](index=63&type=chunk)[64](index=64&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's critical financial condition, dependency on the Decoy merger, and operational results - The company's cash and cash equivalents of **$1.8 million** as of March 31, 2025, are only sufficient to fund operations into the later part of Q2 2025, raising **substantial doubt about its ability to continue as a going concern**[92](index=92&type=chunk)[117](index=117&type=chunk) - On January 10, 2025, Salarius entered into a merger agreement with Decoy Therapeutics, where legacy stockholders would own approximately **14.1%** and Decoy's stockholders would own **85.9%** of the combined company[95](index=95&type=chunk)[96](index=96&type=chunk) - If the merger with Decoy does not close, the company will likely need to **wind-down its operations** and possibly seek bankruptcy protection[94](index=94&type=chunk)[102](index=102&type=chunk)[117](index=117&type=chunk) - The decrease in R&D expenses is due to a cost-savings plan, while the increase in G&A expenses is primarily due to higher professional fees associated with the proposed merger[113](index=113&type=chunk)[115](index=115&type=chunk) Operating Expense Comparison (Q1 2025 vs Q1 2024) | Expense Category | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Research and development | $75,532 | $243,002 | $(167,470) | | General and administrative | $1,643,163 | $1,528,613 | $114,550 | [Quantitative and Qualitative Disclosures about Market Risk](index=25&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a smaller reporting company, Salarius Pharmaceuticals is exempt from providing market risk disclosures - The company is a **smaller reporting company** and is not required to provide quantitative and qualitative disclosures about market risk[123](index=123&type=chunk) [Controls and Procedures](index=25&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective with no significant changes in internal controls - Based on an evaluation as of March 31, 2025, the principal executive and financial officers concluded that the company's **disclosure controls and procedures were effective**[125](index=125&type=chunk) - There were **no significant changes** in the company's internal control over financial reporting during the first quarter of 2025[126](index=126&type=chunk) [PART II. Other Information](index=26&type=section&id=PART%20II.%20Other%20Information) [Legal Proceedings](index=26&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any material legal proceedings - The company is **not currently involved in any material legal proceedings**[128](index=128&type=chunk) [Risk Factors](index=26&type=section&id=Item%201A.%20Risk%20Factors) Key risks include the potential failure of the Decoy merger, insufficient cash reserves, and the threat of Nasdaq delisting - If the merger and associated financing are not completed, the company will likely pursue **dissolution and liquidation**, with no assurance of any cash distribution to stockholders[130](index=130&type=chunk)[135](index=135&type=chunk) - Cash resources of **$1.8 million** are only sufficient to meet needs into the later part of Q2 2025, creating **substantial doubt about the company's ability to continue as a going concern**[132](index=132&type=chunk)[138](index=138&type=chunk) - The company's common stock is **subject to delisting from Nasdaq** due to failure to meet minimum bid price and stockholders' equity requirements[139](index=139&type=chunk)[143](index=143&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=29&type=section&id=Item%202%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company sold $740,500 of common stock through a private placement under its ELOC agreement - Under its ELOC Agreement, the company sold 283,933 shares of common stock for an aggregate purchase price of **$740,500** between January 13, 2025, and March 7, 2025[149](index=149&type=chunk) - The securities were issued in a **private placement** to an accredited investor, relying on exemptions from registration under the Securities Act[148](index=148&type=chunk) [Defaults Upon Senior Securities](index=29&type=section&id=Item%203%20Defaults%20Upon%20Senior%20Securities) None [Mine Safety Disclosures](index=29&type=section&id=Item%204%20Mine%20Safety%20Disclosures) Not Applicable [Other Information](index=30&type=section&id=Item%205%20Other%20Information) None [Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including the Merger Agreement and related officer certifications

Core Insights - Decoy Therapeutics, Inc. is set to merge with Salarius Pharmaceuticals, Inc., with the new entity retaining the name Decoy Therapeutics, following the completion of the merger [1][10] - Renowned MIT Professor Robert S. Langer will join Decoy's Scientific Advisory Board, bringing extensive expertise in drug delivery systems and tissue engineering [1][2][3] Company Overview - Decoy Therapeutics is a preclinical-stage biotechnology company focused on developing peptide-conjugate therapeutics targeting unmet medical needs, particularly in respiratory viruses and gastrointestinal cancers [8] - The company utilizes a proprietary IMP3ACT platform that integrates machine learning and AI for rapid design and synthesis of novel antiviral and cancer therapies [5][7] Scientific Advisory Board - Dr. Robert S. Langer's appointment to the Scientific Advisory Board is expected to enhance Decoy's capabilities in drug design and development, particularly in dosage forms and administration routes [3][4] - Dr. Langer's contributions to the field include pioneering work that has led to transformative medicines, such as Roche's Avastin and Moderna's Spikevax [2][4] Technology and Innovation - Decoy's IMP3ACT platform allows for the rapid computational design of peptide-conjugate drugs, which have shown effectiveness against various human coronaviruses and other viral pathogens [5][7] - The technology leverages peptide chemistry to create multimeric conjugates that improve drug-like properties and pharmacokinetics [7] Financial and Strategic Position - Decoy has secured financing from institutional investors and non-dilutive capital sources, including the Massachusetts Life Sciences Seed Fund and the Google AI startup program [8] - The merger with Salarius is structured such that Decoy investors will own approximately 86% of the merged company, while Salarius stockholders will own about 14% [10]

Core Viewpoint - Decoy Therapeutics Inc. is advancing its IMP3ACT™ platform to develop antiviral drug candidates effective against paramyxoviridae family viruses, including measles and Nipah viruses, and is merging with Salarius Pharmaceuticals to enhance its capabilities in infectious disease and oncology drug development [1][2][4]. Company Overview - Decoy Therapeutics is a preclinical-stage biotechnology company focused on designing peptide-conjugate drug candidates using machine learning (ML) and artificial intelligence (AI) [9]. - The company aims to address serious unmet medical needs, particularly in respiratory viruses and gastrointestinal cancers, and has received funding from various institutional investors and programs [9]. Technology and Platform - The IMP3ACT platform utilizes AI and ML to create peptide-conjugate therapeutics that directly target viral machinery, potentially changing the economics of antiviral drug development [2][4]. - Decoy's technology allows for rapid design and synthesis of antiviral candidates, optimizing them for various properties such as binding specificity and manufacturability [4][8]. Merger Details - Decoy and Salarius Pharmaceuticals have signed a definitive merger agreement, with Decoy investors expected to own approximately 86% of the combined company post-merger [11][12]. - The merger aims to integrate Decoy's expertise with Salarius' resources to advance a diversified pipeline of antiviral and cancer drugs [4][11]. Current Health Context - There is a rising need for new antiviral drugs due to vaccine skepticism and ongoing measles outbreaks, with over 320 cases reported in Texas and additional cases in at least 12 other states [6]. - Measles is highly contagious and can lead to severe health complications, highlighting the urgency for effective treatments [5][6].