ABVC BIOPHARMA, INC.

ABVC BioPharma, Inc. is an early-stage biotechnology company with a pipeline of seven new drugs and one medical device under development, all of which are licensed from related parties of the Company. The biotechnology industry focuses on developing breakthrough products and technologies to combat various diseases through efficient industrial manufacturing, and companies engaged in biotechnology generally require large amounts of capital investment for their research and development activities, with developing and commercializing a new drug or medical device potentially taking up to tens of years. The Company focuses on developing botanical drugs to treat central nervous system (CNS) and oncology/hematology diseases, deriving its pipeline by tracking new medical discoveries in research institutions in the Asia-Pacific region and then licensing those candidates from the original researchers.

The healthcare industry is highly competitive and subject to significant and rapid technological change. Significant competitive factors include product efficacy and safety, quality and breadth of technology, skill of employees, timing and scope of regulatory approvals, manufacturing costs, and intellectual property protection. The Company is a small biopharmaceutical company compared to competitors and intends to license its products to much larger pharmaceutical companies with the financial, technical and human resources to compete effectively. Named competitors include Eli Lilly and Co., Inc., Forest Laboratories, Inc., Pfizer Pharmaceuticals, Inc., Shire Development LLC, Novartis Pharmaceuticals Corporation, Celgene Corporation, Astex Pharmaceuticals, Inc., Genentech, Inc., ImClone Systems Incorporated, Abraxis BioScience LLC, Alcon Laboratories, Inc., and Arcadophta.

The Company generates revenue from outlicensing its intellectual properties and providing CDMO (Contract Development & Manufacturing Organization) services through its wholly owned subsidiary BioKey. The CDMO services include API characterization, pre-formulation studies, formulation development, analytical method development, stability studies, IND/NDA/ANDA/510K submissions, and manufacturing clinical trial materials (Phase I through Phase III) and commercial manufacturing. The Company also generates collaborative revenues through research, development and/or commercialization joint venture agreements, which typically include nonrefundable upfront license fees, development and commercial milestones, partial or complete reimbursement of research and development costs, and royalties on net sales of licensed products, though to date the Company has not received any royalty revenues.

The Company's pipeline includes seven drug candidates and one medical device. In the Central Nervous System area, ABV-1504 is a botanical reuptake inhibitor targeting norepinephrine for Major Depressive Disorder (MDD), which completed a Phase II clinical study on May 23, 2019, where the high dose (2 x 380 mg) met the pre-specified primary endpoint by demonstrating a 13.2-point reduction in the Montgomery-Åsberg Depression Rating Scale (MADRS) total score by Intention-To-Treat analysis compared to a 9.2-point reduction for the placebo group. ABV-1505 is for Adult Attention-Deficit Hyperactivity Disorder (ADHD), sharing the same API as ABV-1504, and its Phase II Part 1 study results showed that the percentages of improvement in ADHD-RS-IV score from baseline to 8 weeks of treatment were 83.3% (N=5) in the ITT population and 80.0% (N=4) in the PP population. ABV-1601 is for Major Depression in Cancer Patients, developed from the same API as ABV-1504. In the Oncology area, ABV-1702 is for Myelodysplastic Syndrome (MDS), ABV-1703 is for Pancreatic Cancer, and ABV-1501 is for Triple Negative Breast Cancer (TNBC), with the latter developed from BLI-1401-2 whose active pharmaceutical ingredient is Yukiguni Maitake Extract 404. The medical device is ABV-1701, Vitargus, a vitreous substitute for use in vitrectomy surgery, which completed a Phase I clinical trial with positive results in July 2018 showing it was well-tolerated without any apparent toxicity to ocular tissues. The Company also has ABV-1519 for Non-Small Cell Lung Cancer treatment and ABV-2002, a corneal storage solution.

In November 2023, the Company and its subsidiary BioLite each entered into a multi-year, global licensing agreement with AiBtl BioPharma Inc. for the Company and BioLite's CNS drugs with the indications of MDD and ADHD. As per each of the respective agreements, each of ABVC and BioLite received 23 million shares of AiBtl stock at $10 per share, and if certain milestones are met, each may receive $3,500,000 and royalties equaling 5% of net sales, up to $100 million. Upon the issuance of the shares, AiBtl became a subsidiary of ABVC. On March 25, 2024, the Company and BioFirst each entered into a twenty-year, global definitive licensing agreement with ForSeeCon Eye Corporation for the products in the Company and BioFirst's Ophthalmology pipeline, including Vitargus, with each of the Company and BioFirst to receive a total licensing fee of $33,500,000, composed of an upfront payment of $30,000,000 (which can instead be paid with 5 million shares of FEYE stock at $6 per share) and a $3,500,000 cash milestone payment. The Company also entered into multiple definitive agreements with OncoX BioPharma, Inc. in April, May, and June 2024 for exclusive rights to develop and commercialize various botanical drug extracts for Non-Small Cell Lung Cancer, Pancreatic Cancer, Triple Negative Breast Cancer, and Myelodysplastic Syndrome, with each agreement providing for payments of $6,250,000 (or 1,250,000 Oncox shares valued at $5 per share) and additional milestone payments of $625,000, plus 5% royalties on net sales. On July 15, 2025, the Company closed the purchase of land from Shuling Jiang, issuing 2,035,136 restricted shares of common stock at a price of $1.65 per share and five-year warrants to purchase up to 1,000,000 shares of common stock with an exercise price of $2.50 per share.

For the year ended December 31, 2025, the Company reported total revenue of $0 ¹, compared to $509,589 ² for the year ended December 31, 2024. Gross profit was $0 ³ in 2025 versus $508,826 ⁴ in 2024. Total operating expenses were $7,151,259 ⁵ for 2025, compared to $5,214,068 ⁶ for 2024. Loss from operations was $7,151,259 ⁷ in 2025 versus $4,705,242 ⁸ in 2024. Net loss was $8,376,959 ⁹ for 2025, compared to $5,259,037 ¹⁰ for 2024. Net loss attributable to ABVC and subsidiaries was $7,908,554 ¹¹ for 2025 versus $4,902,878 ¹² for 2024. Basic and diluted net loss per common share was $0.39 ¹³ for 2025 compared to $0.42 ¹⁴ for 2024.

The Company's primary growth vector is advancing its pipeline of seven drug candidates and one medical device through clinical trials and then outlicensing them to large pharmaceutical companies for Phase III studies and commercialization. Key milestones include the Phase II study for ABV-1701 Vitargus in vitrectomy surgery, which started in the second quarter of 2023 at four sites in Australia and Thailand, with the Company working on improvements to the Vitargus Product through a new batch of investigational product. The Phase II Part 2 clinical trial for ABV-1505 for ADHD is ongoing, with the subjects enrolled reaching the number for interim analysis (69 subjects) in December 2023, and the clinical study report was sent to the FDA. The Company expects to begin Phase II clinical trials of ABV-1702 for Myelodysplastic Syndrome in the fourth quarter of 2026. Trials expected to begin in the third quarter of 2026 include ABV-1519 for Non-Small Cell Lung Cancer in Taiwan and ABV-1703 for Advanced Inoperable or Metastatic Pancreatic Cancer at Cedars Sinai Medical Center. The Company also plans to initiate the Phase II trial for ABV-1601 for Depression in Cancer Patients around the end of 2026.

The Company's growth strategy also involves expanding its CDMO services through BioKey, which operates a certified GMP manufacturing facility qualified to deliver small quantities of drugs for clinical trials from Phase I to Phase III. BioKey began manufacturing a dietary supplement based on the maitake mushroom in 2022, with a three-year distribution agreement with Define Biotech Co. Ltd. granting exclusive distribution rights in China and Taiwan in exchange for a commitment to purchase $3.0 million of the new product over three years, which agreement auto renewed for another 2 years through December 6, 2026. The Company also plans to use acquired land in Taiwan to grow its botanical drug raw materials under its control to maintain quality and lower costs when its botanical drugs become commercialized.

The filing does not contain specific margin trajectory or cost structure evolution targets.

The Company's operational outlook includes the construction of a GMP factory in Hsinchu Biomedical Science Park, Taiwan, by BioFirst, with the aim of building a production base to supply the global market for Vitargus, targeting completion in 2026. The Company's subsidiary BioKey operates a GMP facility in Fremont, California, with an office lease ending February 28, 2031, occupying approximately 28,186 square feet. As of December 31, 2025, the Company had 19 employees, 16 of which are full-time, located in the U.S. and Taiwan.

The Company's capital allocation is focused on funding research and development activities and working capital. For the year ended December 31, 2025, research and development expenses were $121,085 ¹⁵. The Company has been financing operations through private placements, warrant exercises, and convertible notes. During 2025, the Company conducted private offerings raising a total of $3,305,303 ¹⁶ from the issuance of 3,354,475 shares of common stock. Proceeds from exercise of warrants were $991,366 ¹⁷. Proceeds from convertible notes payable to third parties were $499,010 ¹⁸ and to related parties were $390,000 ¹⁹. The Company has not paid any cash dividends on its Common Stock and does not anticipate paying any cash dividends in the foreseeable future.

The Company faces significant headwinds related to its financial condition. As of December 31, 2025, the Company had a working capital deficit of $3,662,633 ²⁰, consisting of current assets of $2,501,343 ²¹ and current liabilities of $6,163,976 ²². The Company reported a net loss of $8,376,959 ²³ for the year ended December 31, 2025, and net cash outflows from operating activities of $2,986,299 ²⁴. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The Company has had to put several projects on hold due to a lack of funding. Additionally, the Company has identified material weaknesses in internal control over financial reporting related to not having sufficient and skilled accounting personnel, which resulted in restatements of previously filed financial statements.

The Company faces regulatory and competitive headwinds. It has no history in obtaining regulatory approval for, or commercializing, any new drug candidate, and the FDA may refuse to accept its planned NDA for any of the six drug products. The Company faces substantial competition from companies with considerably more resources and experience, including well-established pharmaceutical companies in the fields of CNS, oncology/hematology and ophthalmology. The Company also faces risks related to its international operations, as sales to customers outside the United States accounted for 100% and 100% for the years ended December 31, 2025 and 2024, respectively, and the Company has key employees and operations in Taiwan, exposing it to foreign economic downturns, political instability, and currency exchange risks.

The Company faces substantial doubt about its ability to continue as a going concern, evidenced by a net loss of $8,376,959 ²⁵ for 2025, a working capital deficit of $3,662,633 ²⁶, and net cash outflows from operating activities of $2,986,299 ²⁷. The Company has no history in obtaining regulatory approval for or commercializing any new drug candidate, and the FDA may refuse to accept its planned NDA for any of the six drug products. The Company's existing indebtedness, including convertible notes payable to third parties of $559,010 ²⁸ and to related parties of $240,000 ²⁹ as of December 31, 2025, may adversely affect its ability to obtain additional funds. The Company has identified material weaknesses in internal control over financial reporting that resulted in restatements of previously filed financial statements. The Company's growth is dependent on its ability to successfully develop, acquire or license new drugs, and it may not be able to recover its investment in development of new drugs and medical devices. The Company depends on one supplier, Yukiguni, for the API of four drug candidates (ABV-1703, ABV-1519, ABV-1502 and ABV-1501), and any failure of such supplier to deliver sufficient quantities could have a material adverse effect.

Management's message emphasizes the Company's mission to become a pioneer in the biopharmaceutical industry by developing innovative botanical drugs to treat CNS and oncology/hematology diseases. The strategic priorities include advancing the pipeline through Phase II clinical trials and then outlicensing post-Phase-II products to large pharmaceutical companies for Phase III studies and commercialization. Key forward-looking statements include expectations to begin Phase II clinical trials of ABV-1702 in the fourth quarter of 2026, to initiate the Phase II trial for ABV-1601 around the end of 2026, and to begin trials for ABV-1519 and ABV-1703 in the third quarter of 2026. Management also highlights the collaborative agreements with AiBtl, ForSeeCon Eye Corporation, and OncoX BioPharma as significant developments, with potential milestone payments and royalties. The tone acknowledges the challenges of being a clinical stage biopharmaceutical company with limited revenue and the need to raise additional capital to fund operations.