ALLR

Business Context and Reporting Period

Allarity Therapeutics, Inc. (ALLR) is a clinical-stage precision medicine company focused on developing stenoparib, a dual inhibitor of PARP and tankyrases, alongside its proprietary Drug Response Predictor (DRP®) companion diagnostic. The company terminated all other assets (dovitinib, Irofulven, LiPlaCis) to singularly focus on stenoparib for the treatment of platinum-resistant ovarian cancer and relapsed small cell lung cancer (SCLC). This filing covers the fiscal year ended December 31, 2025.

Key Financial Metrics

Note: The 2024 results included a one-time $9.7 million impairment charge on intangible assets and a $2.5 million SEC settlement charge, which significantly inflated expenses for that period.

Material Changes vs. Prior Period

• Reduced Net Loss: The net loss decreased by approximately $13.3 million year-over-year, primarily driven by the absence of the $9.7 million intangible asset impairment and the $2.5 million SEC settlement charge recorded in 2024.
• Revenue Generation: The company recognized $0.3 million in license revenue in 2025 from DRP testing services, compared to zero revenue in 2024.
• Expense Reduction: General and Administrative expenses dropped by $5.1 million, largely due to the resolution of the SEC investigation and reduced legal fees. R&D expenses increased slightly by $0.5 million due to higher staffing costs.
• Cash Position: Cash decreased by $4.8 million, reflecting a net cash outflow from operations of $14.8 million, partially offset by $10.6 million in financing activities (equity issuances and PIPE financing).

Guidance, Outlook, and Risks

Clinical Progress:

• Ovarian Cancer: A new Phase 2 trial initiated in June 2025 is enrolling 40 patients with platinum-resistant ovarian cancer at two dose levels. Emerging data from prior cohorts showed a confirmed complete response and durable stable disease in heavily pre-treated patients.
• SCLC: A randomized, biomarker-driven trial combining stenoparib with Temozolomide for relapsed SCLC, fully funded by the US Veterans Administration, opened for enrollment in January 2026.

Liquidity and Capital Resources:

• As of December 31, 2025, the company held $14.7 million in cash, which management believes is sufficient to fund operations through at least the second quarter of 2027.
• Subsequent to year-end, the company secured a $6 million equity facility (January 2026) and issued $20 million in promissory notes (March 2026).

Risks and Contingencies:

• Regulatory: The company settled an SEC investigation regarding prior disclosures with a $2.5 million penalty paid in April 2025. A class action lawsuit related to the same matter was dismissed in February 2025.
• Licensing: The company faces potential termination of its stenoparib license from Eisai if it fails to meet payment obligations or development milestones. However, all current payments to Eisai are up to date.
• Novartis Liability: Following the termination of the Novartis license in 2024, a liability of approximately $5.5 million (including accrued interest) remains outstanding and is recorded as a current liability.

Investor Verification Checklist

• Cash Runway: Verify the sufficiency of the $14.7 million cash balance against the burn rate required to complete the new Phase 2 ovarian cancer trial and the SCLC trial.
• Debt Obligations: Confirm the terms and repayment schedule of the $20 million promissory notes issued to Streeterville Capital in March 2026.
• Eisai Milestones: Monitor the company's ability to meet the development milestones and payment schedules required to maintain the exclusive license for stenoparib.
• Clinical Enrollment: Track patient enrollment rates in the new Phase 2 ovarian cancer trial to ensure timelines are met.
• Novartis Liability: Assess the impact of the $5.5 million Novartis liability on future liquidity and potential legal resolutions.