Actuate Therapeutics Inc

Item 1A. Risk Factors

RISK FACTORS

Investing in our common stock involves a high degree of risk. Before you decide to invest in our common stock, you should carefully consider all the information within this Quarterly Report, including the information contained in Part I, Item 2, Managements Discussion and Analysis of Financial Condition and Results of Operations, as well as in our condensed consolidated financial statements and the related notes contained in Part I, Item 1 within this Quarterly Report. In addition, you should carefully consider the risks and uncertainties described in Part I, Item 1A, Risk Factors, of our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 13, 2025 (Annual Report), our Quarterly Reports on Form 10-Q for the quarter ended March 31, 2025 filed with the SEC on May 15, 2025, a, as well as in our other public filings with the SEC. If any of the identified risks are realized, our business, results of operations, financial condition, liquidity, and prospects could be materially and adversely affected. In that case, the trading price of our common stock may decline, and you could lose all or part of your investment. In addition, other risks of which we are currently unaware, or which we do not currently view as material, could have a material adverse effect on our business, results of operations, financial condition, and prospects.

Other than sas set forth below, there have been no material changes to our risk factors disclosed in in Part I, Item 1A, of our Annual Report or our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 filed with the SEC on May 15, 2025.

Risks Related to Our Financial Condition and Capital Requirements

Our financial condition raises substantial doubt as to our ability to continue as a going concern.

As of June 30, 2025, we had $6,492,656 in cash and cash equivalents and working capital deficit of $2,512,162. Based on our current operating plan, we estimate that our existing cash and cash equivalen2, Managements as of the date of this Report will not satisfy the Companys operational and capital requirements beyond October, 2025 without raising additional capital.

We have incurred and expect to continue to incur significant costs in the development of our sole drug candidate, elraglusib. Our unaudited condensed consolidated financial statements have been prepared assuming that we will continue to operate as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business; however, our current liabilities exceed our assets as of June 30, 2025. To date, we have not generated product revenues from our activities and have incurred substantial operating losses. We expect that we will continue to generate substantial operating losses for the foreseeable future, if and until, we are able complete development and potentially receive approval of our product candidate. We expect to continue to fund our operations primarily through utilization of our current financial resources and we will require additional funding of capital in the near term.

These conditions raise substantial doubt about our ability to continue as a going concern. Discussion and Additionally, our independent registered public accounting firm included in its audit opinion for the year ended December 31, 2024 an explanatory paragraph that there is substantial doubt as to our ability to continue as a going concern. We plan to address these conditions by raising funds from public or private offerings of equity or debt securities and other funding sources, which includes funding under our Committed Equity Facility. During the six months ended June 30, 2025, the Company raised $4,621,546 in net proceeds under the June 2025 Private Placement and $2,148,506 in net proceeds under the Committed Equity Facility. However, there can be no assurance that the Company will be able to raise sufficient proceeds under the Committed Equity Facility in the future or any additional financing will be available to the Company on acceptable terms, if at all, or will provide us with sufficient funds to meet our objectives. If we are unable to raise additional capital in the near term, we could be forced to delay, reduce or eliminate our research and development programs or any future commercialization efforts, or even curtail or cease operations.

In addition, the reaction of investors to the inclusion of a going concern statement by our auditors and our potential inability to continue as a going concern may materially adversely affect our ability to raise new capital or enter into partnerships. The perception that we may not be able to continue as a going concern may also make it more difficult to operate our business due to concerns about our ability to meet our contractual obligations. If we become unable to continue as a going concern, we may have to liquidate our assets and the value we receive for our assets in liquidation or dissolution could be significantly lower than the value reflected in our unaudited condensed consolidated financial statements, and it is likely that investors will lose all or a part of their investment.

We will require substantial additional capital to finance our operations in the near term, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our development programs, commercialization efforts or curtail or cease operations.

The development of biopharmaceutical product candidates, including conducting preclinical studies and clinical trials, is a very time-consuming, capital-intensive and uncertain process. Our oysis of Financial Condition and Results of Operations have consumed substantial amounts of cash since inception. We expect our expenses to substantially increase in connection with our ongoing activities, particularly as we conduct our ongoing and planned clinical trials of elraglusib and potentially seek regulatory approval for elraglusib and any future product candidates we may develop. In addition, if we are able to progress elraglusib through development and commercialization, which we may never do, we expect to be required to make milestone and royalty payments pursuant to various license or collaboration agreements with third parties. If we obtain regulatory approval for elraglusib or any future product candidates, which may never occur, we also expect to incur significant commercialization expenses related to product manufacturing, marketing, sales, and distribution. Because the outcome of any clinical trial or preclinical study is highly uncertain, we cannot reliably esti, there have been no mate the actual amount of capital necessary to successfully complete the development and commercrialization of elraglusib or any future product candidates. Furthermore, we incur additional costs associated with operating as a public company.

Based on our current operating plan, we believe that our existing cash and cash equivalents will not be sufficient to fund our operations beyond October, 2025 without raising additional capital.

Our estimates and assumptions regarding our operating costs may prove to be wrong, and we could use our capital resources sooner than we currently expect. Our operating plans and other demands on our cash resources may change as a result of many factors currently unknown to us, and we may need to seek additional funds sooner than planned.

Our existing capital will not be sufficient to complete development of elraglusib in any form, or any future product candidates, and we require substantial capital in order to advance elraglusib and any future product candidates through clinical trials, regulatory approval and commercialization. Accordingly, we will need to obtain substantial additional funding in the near term, and expect that such funding requirements will be in addition to any proceeds resulting from the sale of shares under the Committed Equity Facility, in connection with our continuing operations. Our ability to raise additional funds may be adversely impacted by business conditions, global economic conditions, disruptions to, and volatility in, the credit and financial markets in the United States and worldwide, and diminished liquidity and credit availability. If the equity and credit markets deteriorate, it may make any necessary debt or equity financing more difficult, more costly and more dilutive. We expect to finance our cash needs through public or private equity or debt financings or other capital sources, including potential collaborations, licenses, and other similar arrangements. In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. Attempting to secure additional financing may divert our management from our day-to-day activities, which may adversely affect our ability to develop elraglusib or any future product candidates.

Ou changes to our risk factors disclosed in Part I, Item 1A, of our future capital requirements will depend on many factors, including without limitation:

Conducting cAnnualinical trials and preclinical studies and potentially identifying future product candidates is a time-consuming, expensive and uncertain process that takes years to complete, and we may never generate the necessary data or results required to obtain regulatory approval and commercialize elraglusib or any future product candidates. If approved, elraglusib and any future product candidates may not achieve commercial success. We expect that our commercial revenue, if any, will initially be derived from sales of elraglusib, which we do not expect to be commercially available for several years, if at all. Commercial success in the United States may depend upon acceptance and coverage by federal healthcare program and third-party payors, and it can be time consuming and costly to demonstrate that any of our products should be covered.

Accordingly, in the near term, we intend to seek and will need to continue to rely on additional financing to achieve our business objectives. Ade Report or our Quarterly Reports on Form 10-Q for the quate additional financing may not be available to us on acceptable terms, or at all, including as a result of financial and credit market deterioration or instability, market-wide liquidity shortages, geopolitical events or otherwise. If we are unable to raise capital in the near term or on attractive terms, we could be forced to delay, reduce or eliminate our research and development programs or any future commercialization efforts, or even curtail or cease operations. Even if we secure necessary financing in the near term, we expect to continue to require substantial funding as the timing for and ability to generate sufficient funds from operations will remain uncertain until such time as we are able to progress elraglusib through development and potential commercialization.

Risks Related to the Committed Equity Facility and our Common Stock

Sales of a substantial number of our securities in the public market by our existing stockholders could cause the price of our shares of common stock to fall.

B. Riley can resell up to rters ended March 3,904,374 shares of common stock that we may, in our sole discretion, elect to sell to B. Riley from time to time during the term of the Committed Equity Facility. If the 3,647,945 remaining shares of common stock available for issuance under the Committed Equity Facility as of 1, 2025 and June 30, 2025 were offered for resale by B. R, filey, such shares would represent approximately 15.13% of the total number of outstanding shares of common stock as of June 30d with the SEC on May 15, 2025. In addition, we registered for resale the 666,497 shares of common stock issued in the June 2025 Private Placement, plus the additional 666,497 shares that may be issued upon exercise of the warrants issued in the June  and August 14, 2025 Private Placement. Sales of a substantial number of our shares of common stock in the public market by B. Riley and/or by our other existing stockholders, or the perception that those sales might occur, could depress the market price of our shares of common stock and could impair our ability to raise capital through the sale of additional equity securities, respectively.