NOTE 1 – BUSINESS

Tonix Pharmaceuticals (“Tonix” or the “Company”) is a fully-integrated biopharmaceutical company commercializing and developing innovative therapies for central nervous system (“CNS”) disorders, immunology, infectious diseases, and rare diseases. Our portfolio consists of both commercial and development-stage programs.

In August 2025, Tonix received approval from the U.S. Food and Drug Administration (“FDA”) for TONMYA™ (cyclobenzaprine HCl sublingual tablets) for the treatment of fibromyalgia. TONMYA, Tonix’s first internally developed product to become FDA approved, was commercially launched by the Company in the United States on November 17, 2025. TONMYA is the first new medicine for fibromyalgia in more than 15 years and is a centrally acting, non-opioid analgesic designed for bedtime administration and long-term use. The approval and launch of TONMYA marked major milestones in Tonix’s evolution. The Company holds worldwide commercialization rights to TONMYA. In addition to TONMYA, Tonix markets two FDA-approved prescription products for the treatment of acute migraine: Zembrace® SymTouch® (sumatriptan injection) and Tosymra® (sumatriptan nasal spray). Tonix’s commercial platform includes sales, marketing, market access, distribution, and patient support capabilities.

Tonix maintains a diversified development pipeline generated through internal discovery, in-licensing, acquisitions, and collaborations with academic and non-profit institutions. The Company’s pipeline addresses conditions that span central nervous system (“CNS”), infectious disease, immunology, and rare disease, with multiple programs in clinical and preclinical development. The proprietary cyclobenzaprine HCl sublingual tablet formulation contained in TONMYA is referred to as “TNX-102 SL” outside of the fibromyalgia indication. Tonix is exploring the utility of TNX-102 SL (sublingual cyclobenzaprine) in Phase 2 clinical trials for major depressive disorder and acute stress disorder. TNX-102 SL is being developed to treat acute stress reaction and acute stress disorder under an Investigator-Initiated investigational new drug application (“IND”) at the University of North Carolina in the ongoing OASIS study funded by the U.S. Department of Defense (“DoD”). A Phase 2 study of TNX-102 SL for major depressive disorder is expected to commence mid-2026 under a Tonix IND that has been cleared by FDA.

Tonix’s clinical stage infectious disease portfolio includes monoclonal antibody TNX-4800 (anti-OspA from Borrelia burgdorferi) for seasonal prevention of Lyme disease, for which initiation of a Phase 2 field study is planned for the first half of 2027 and a Phase 2 human challenge study is planned for 2028, pending FDA clearances.

Tonix’s clinical-stage immunology development portfolio consists of biologics to address organ transplant rejection, autoimmunity and cancer, including TNX-1500, which is a Phase 2- ready Fc-modified humanized monoclonal antibody targeting CD40-ligand (CD40L or CD154) being developed for the prevention of allograft rejection and for the treatment of autoimmune diseases.

Another CNS candidate in clinical development is TNX-1300 (double-mutant cocaine esterase), which is in Phase 2 for the treatment of cocaine intoxication. TNX-1300 has been granted Breakthrough Therapy designation by the FDA.

Tonix’s clinical-stage rare disease portfolio includes TNX-2900, intranasal oxytocin potentiated with magnesium, in development for Prader-Willi syndrome and expected to start a Phase 2 study in the first quarter of 2027.

Tonix’s pre-clinical, pre-IND infectious disease portfolio includes TNX-801 (horsepox, live virus vaccine), as vaccine for mpox and smallpox. We own a facility in Dartmouth, MA that was purpose-built to manufacture TNX-801 under Good Manufacturing Practices (GMP) to support clinical development and potential commercialization.

Tonix’s pre-IND infectious disease portfolio also includes TNX-4200, which is a small molecule broad-spectrum antiviral agent targeting CD45 for the prevention or treatment of high lethality infections to improve the medical readiness of military personnel in biological threat environments. The TNX-4200 program is supported by a $34 million contract over five years from the U.S. DoD’s Defense Threat Reduction Agency (DTRA). Tonix owns and operates a state-of-the art research facility in Frederick, Maryland that supports this research.

Tonix’s pre-IND pre-clinical immunology portfolio includes TNX-1700, which is a fusion protein of TFF2 and albumin is in preclinical development for the treatment of gastric cancer in combination with PD-1 blockade in collaboration with Columbia University.

Tonix’s pre-clinical, pre-IND CNS portfolio also includes TNX-4900, a highly selective small-molecule Sigma-1 receptor (“S1R”) antagonist for neuropathic pain.

The consolidated financial statements include the accounts of Tonix Pharmaceuticals Holding Corp. and its wholly owned subsidiaries, Tonix Sub, Krele LLC, Tonix Pharmaceuticals (Canada), Inc., Tonix Medicines, Jenner Institute LLC, Tonix R&D Center LLC, Tonix Pharma Holdings Limited and Tonix Pharma Limited (collectively, the “Company” or “Tonix”). All intercompany balances and transactions have been eliminated in consolidation.

Going Concern

The accompanying financial statements have been prepared on a basis which assumes that the Company will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business. The Company has suffered recurring losses from operations and negative cash flows from operating activities. At December 31, 2025, the Company had working capital of approximately $198.0 million. At December 31, 2025, the Company had an accumulated deficit of approximately $854.7 million. The Company held unrestricted cash and cash equivalents of approximately $207.6 million as of December 31, 2025.

The Company believes that its cash resources at December 31, 2025, and the net proceeds of $8.6 million that it received from the sale of equity in the first quarter of 2026 (See Note 19), will meet its planned operating and capital expenditure requirements into the first quarter of 2027.

These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company continues to face significant challenges and uncertainties and must successfully launch TONMYA and obtain additional funding through public and private financing and collaborative arrangements with strategic partners to increase the funds available to fund operations. However, the Company may not be able to raise capital on terms acceptable to the Company, or at all. Without the successful product launch of TONMYA and obtaining additional funds, the Company may be forced to delay, scale back or eliminate some or all of its research and development activities or other operations, and potentially delay product development in an effort to maintain sufficient funds to continue operations. If any of these events occurs, the Company’s ability to achieve development and commercialization goals will be adversely affected and the Company may be forced to cease operations. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.