Financial Analysis

Asset Acquisition Stella Diagnostics - Asset Purchase Agreement On December 15, 2022, the Company entered into an Asset Purchase Agreement (the Stella Purchase Agreement), with Stella Diagnostics Inc. (Stella) and Stella DX, LLC (Stella DX and, together with Stella, the Stella Sellers), pursuant to which, on January 3, 2023, the Company purchased all of the assets, rights and interests of the Stella Sellers and their affiliates pertaining to the Stella Sellers BE-Smart Esophageal Pre-Cancer Diagnostic Screening Test and certain clinical assets, including all intellectual property rights (the Stella Purchased Assets). All capitalized terms used in this section to describe this transaction but not defined herein shall have the meanings set forth in the Stella Purchase Agreement, As consideration for the Stella Purchased Assets, at closing, the Company (i) paid to the Stella Sellers $3.5 million in cash, minus (a) the Secured Note Amount of $0.5 million, (b) the Liability Payoff Amount of $1.6 million and (c) the Promissory Note Payoff Amount of $400,000, and (ii) issued to Stella DX 10,000 shares of common stock, par value $0.0005 per share, of the Company at a value of $100.00 per share. Total consideration paid was $4.6 million. The Secured Note Amount of $0.5 million and the Promissory Note Payoff of $400,000 were paid in 2022. The balance of the consideration was paid at closing on January 3, 2023. In addition to the consideration paid at closing, the Company will issue sha …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

"Commitments and Contingencies License Agreements Linebacker LB1 and LB2 In July 19, 2022, the Company through its wholly-owned subsidiary ProPhase BioPharma entered into a License Agreement (the Linebacker License Agreement) with Global BioLife, Inc. (the Licensor), with an effective date of July 18, 2022 (the Linebacker Effective Date), pursuant to which it acquired from Licensor a worldwide exclusive right and license under certain patents identified in the Linebacker License Agreement (the Licensed Patents) and know-how (collectively, the Licensed IP) to exploit any compound covered by the Licensed Patents (the Licensed Compound), including Linebacker LB1 and LB2, and any product comprising or containing a Licensed Compound (Licensed Products) in the treatment of cancer, inflammatory diseases or symptoms, memory-related syndromes, diseases or symptoms including dementia and Alzheimers Disease (the Field). Under the terms of the Linebacker License Agreement, the Licensor reserves the right, solely for itself and for GRDG Sciences, LLC (GRDG) to use the Licensed Compound and Licensed IP solely for research purposes inside the Field and for any purpose outside the Field. Subject to certain conditions set forth in the Linebacker License Agreement, the Company may grant sublicenses (including the right to grant further sublicenses) to its rights under the Linebacker License Agreement to any of its affiliates or any third party with the prior written consent of Licensor, which …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

"Outstanding Debt Secured Promissory Note On December 19, 2024 (the Closing Date), PMI entered into a secured promissory note agreement with an individual investor for cash proceeds of $1.0 million (the PMI Note). The PMI Note has an annual interest rate of 15% . The PMI Note is due upon the sale of PMI or 12 months from the Closing Date. On January 16, 2025, the PMI Note was extinguished as a result of the disposal of PMI and PREH. The gain was recognized as part of gain from sale of discontinued operations on the consolidated statement of operations. Collateralized Loan Agreement On November 21, 2024 the Company entered into a financing agreement (the 2024 Collateralized Loan Agreement) with CJEF Capital Partners PTE Ltd. (CJEF), to provide the Company with loan funding to be secured by 600,000 shares of common stock (the 2024 Collateralized Loan). Funding is to be provided in tranches and shall mature 2 years from date of funding. Collateral retained by CJEF will be pledged and utilized to secure each funding and to be retained until all principal and interest have been paid. Interest will accrue on the outstanding principal amount of the 2024 Collateralized Loan at 6% per annum (payable semi-annually in advance) and an arranger fee of 5% will be retained by CJEF from Loan proceeds. As of December 31, 2025, the Company has been provided funding of $500,000 against the 2024 Collateralized Loan agreement, with the entire balance remaining outstanding. On October 14, 2025, th …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table disaggregates our deferred revenue by recognition period (in thousands): As of December 31, 2025 As of December 31, 2024 Recognition Period 0-12 Months $ 1,501 $ 1,698 13-24 Months 643 784 Total $ 2,144 $ 2,482 The following table disaggregates the Companys revenue by revenue source for Fiscal 2025 and 2024 (in thousands): For the years ended Revenue by Customer Type December 31, 2025 December 31, 2024 Retail and others $ $ 1,492 Genomic products and services 4,345 5,278 Total revenue, net $ 4,345 $ 6,770 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

Fair Value Measurements The following table presents the fair value of the Companys financial liabilities that are measured at fair value on a recurring basis as of December 31, 2025 (in thousands): As of December 31, 2025 Level 1 Level 2 Level 3 Total Derivative liability $ $ $ 50 $ 50 There were no transfers between Level 1, 2 or 3 during the year ended December 31, 2025 and 2024. The following table presents changes in Level 3 liabilities measured at fair value for the year ended December 31, 2025. Both observable and unobservable inputs were used to determine the fair value of positions that the Company has classified within the Level 3 category. Unrealized gains and losses associated with liabilities within the Level 3 category include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable (e.g., changes in unobservable long- dated volatilities) inputs (in thousands). Warrant liability Derivative liability Balance at January 1, 2025 $ $ Issuance of unvested warrants in conjunction with loan agreements 230 Issuance of convertible debt 2,070 Issuance of unvested warrants as an additional consideration to the August Future Financing Agreement 120 Convertible notes redemptions (1,583) Change in fair value 225 (437) Reclassification of liability classified warrants to equity (575) Balance at December 31, 2025 $ $ 50 A summary of the weighted average (in aggregate) significant unobservable inputs (Level 3 input …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

"Income Taxes The components of the provision (benefit) for income taxes, in the consolidated statements of operations are as follows (in thousands): For the years ended December 31, 2025 December 31, 2024 Continuing Operations Current Federal $ $ State 45 $ 45 Deferred Federal 5,336 State 1,814 $ $ 7,150 Income taxes provision (benefit) from continuing operations $ $ 7,195 The following reconciles the differences between income taxes computed at the federal statutory rate and the provision for income taxes (in thousands): Year Ended December 31, 2025 Year Ended December 31, 2024 Amount Percent % Amount Percent % Statutory Rate - federal $ (4,911) 21.0 % $ (7,382) 21.0 % Nontaxable or nondeductible items 265 (1.1) % % State taxes, net of federal benefit % (2,373) 6.8 % Permanent differences and other % 521 (1.5) % Change in valuation allowance 4,646 (19.9) % 16,429 (46.7) % Effective tax rate $ % $ 7,195 (20.4) % The income taxes paid for the year ended December 31, 2025 consisted of the following (in thousands): U.S. Federal $ 327 State and Local Income Taxes New Jersey 57 New York 1,033 New York City 227 Other States 1 Total $ 1,645 Deferred tax assets and liabilities reflect the net tax effects of net operating loss and tax credit carryforwards and temporary differences between the carrying amount of assets and liabilities for financial reporting and the amounts used for tax purposes. Significant components of the Company's deferred tax assets and liabilities were as follo …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

"Leases Operating Leases New Jersey Laboratory Lease On October 23, 2020, we completed the acquisition of CPM, which included a 4,000 square foot CLIA accredited laboratory located in Old Bridge, New Jersey, which was owned by CPM (which is now known as ProPhase Diagnostics NJ, Inc.). The lease was renewed in February 2023, for an additional 36 months until February 2026. The monthly base is $5,500 per month. The lease renewal resulted in the recognition of an additional right-of-use asset and operating lease liability of $170,000, respectively in Fiscal 2023. As a result of the deconsolidation of PDX (see Note 18), the operating lease liability and right-of-use asset associated with the New Jersey operating lease was derecognized on the Company's consolidated balance sheet as of December 31, 2025. New York Second Floor Lease On December 8, 2020, the Company entered into a Lease Agreement (the NY Second Floor Lease) with BRG Office L.L.C. and Unit 2 Associates L.L.C. (the Landlord), pursuant to which the Company leases certain premises located on the second floor (the Second Floor Leased Premises) of 711 Stewart Avenue, Garden City, New York (the Building). The Second Floor Leased Premises serve as the Companys second location and corporate headquarters, offering a wide range of laboratory testing services for diagnosis, screening and evaluation of diseases, including COVID-19 and Respiratory Pathogen Panel Molecular tests. On June 10, 2022, the Company entered into a First A …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

Recently Issued Accounting Standards, Adopted In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. This guidance will be effective for the annual periods beginning the year ended December 31, 2025. Early adoption is permitted. Upon adoption, the guidance can be applied prospectively or retrospectively. The Company adopted this standard as of January 1, 2025. The adoption of this ASU did not have any material impact on the Companys quarterly condensed consolidated financial statements. The Company applied the new disclosure requirements prospectively. See Note 9, Income Taxes, for further detail. Recently Issued Accounting Standards, Not Yet Adopted In November 2024, the FASB issued ASU No. 2024-03 (ASU 2024-03), Disaggregation of Income Statement Expenses (DISE) which requires disaggregated disclosure of income statement expenses for public business entities. The standard requires public business entities to disclose disaggregated information about specific natural expense categories underlying certain income statement expense line items that are considered relevant. The FASB al …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Defined Contribution Plans The Company maintains the ProPhase Labs, Inc. 401(k) Savings and Retirement Plan, a defined contribution plan for its employees. The Company's contributions to the plan are based on the amount of the employee plan contributions and compensation. The Company's contributions to the plan for the years ended December 31, 2025 and 2024 were $0.2 million and $0.2 million, respectively.

PensionAndOtherPostretirementBenefitsDisclosureTextBlock

Related Parties The Company's Executive Vice President and Co-Chief Operations Officer of ProPhase Diagnostics, and President of Nebula Genomics, is a related party to the Company's Chairman and Chief Executive Officer. For the years ended December 31, 2025 and 2024, there were no payments made to the Executive Vice President outside compensation and benefits for the position held at the Company. On February 18, 2025 announced that Stuart Hollenshead has been appointed to serve as Chief Operating Officer of the Company, effective on February 17, 2025 and held this position until his resignation on July 31, 2025. Currently, Mr. Hollenshead serves as CEO of 10PM Curfew. The Company received consulting services from 10PM Curfew on an ongoing basis. During the year ended December 31, 2025 and 2024, consulting services from 10pm Curfew totaled $167,000 and $165,000, respecti vely. Amounts payable 10PM Curfew as of December 31, 2025 and 2024 was zero and $10,000, respectively. The Company continues to utilize 10PM Curfew for consulting services. On June 22, 2025, the Company entered into a loan agreement with Ted Karkus, the Companys Chief Executive Officer and the Chairman of the Board of Directors, pursuant to which the Company issued a twelve-month non-convertible promissory note in the principal amount of 625,000 . The Company also issue d 50,000 unvested warrants in conjunction with the note agreement. See Note 6 f or detail description regarding the CEO Loan and the CEO Warra …

RelatedPartyTransactionsDisclosureTextBlock · excerpt; the full note is in the filing

Segment Information The Company has identified two operating segments, diagnostic services and consumer products, based on the manner in which the Companys CEO as CODM assesses performance and allocates resources across the organization. The operating segments are organized in a manner that depicts the difference in revenue generating synergies that include the separate processes, profit generation and growth of each segment. The diagnostic services segment provides COVID-19 diagnostic information services to a broad range of customers in the United States, including health plans, third party payers and government organizations. The consumer products segment is engaged in the research, development, manufacture, distribution, marketing and sale of OTC consumer healthcare products and dietary supplements in the United States and also provides personal genomics products and services. The unallocated corporate expenses mainly included professional fees, interest expenses associated with the outstanding debt associated with the Company. The following table is a summary of segment information for Fiscal 2025 and 2024 (in thousands): For the years ended December 31, 2025 December 31, 2024 Net revenues Diagnostic services $ $ Consumer products 4,345 6,770 Consolidated net revenue 4,345 6,770 Cost of revenue Diagnostic services 351 2,329 Consumer products 2,610 4,591 Consolidated cost of revenue 2,961 6,920 Depreciation and amortization expense Diagnostic services 614 1,604 Consumer p …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the current period presentation. These reclassifications had no effect on the reported results of operations. Reverse Stock Split On December 2, 2025, the Company filed a Certificate of Amendment (the Certificate of Amendment) to its Certificate of Incorporation with the Secretary of State of the State of Delaware to effect a 1-for-10 reverse stock split of the Companys issued and outstanding shares of common stock, par value $0.0005 per share (the Common Stock) (the Reverse Stock Split). The Certificate of Amendment became effective on December 2, 2025. The reverse stock split was implemented to increase the per-share trading price of the Companys common stock to meet continued listing requirements. The Reverse Stock Split became effective as of 8:00 a.m., Eastern Time, on December 22, 2025 (the Effective Time). At the Effective Time, every 10 shares of Common Stock issued and outstanding immediately prior to the Effective Time were combined into one issued and outstanding share of Common Stock. No fractional shares were issued in connection with the Reverse Stock Split. Instead, any stockholder who otherwise would be entitled to receive a fracti …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

"Stockholders Equity Charter Amendment Our authorized capital stock consists of 1,000,000,000 shares of common stock, $0.0005 par value, and 1,000,000 shares of preferred stock, $0.0005 par value. At the Special Meeting of Stockholders held on September 9, 2025, the Company's stockholders approved a Certificate of Amendment to its Amended and Restated Certificate of Incorporation (the Certificate of Amendment) to increase the number of authorized shares of common stock from 50,000,000 shares to 1,000,000,000 shares. The Certificate of Amendment was filed on September 15, 2025 the Delaware Secretary of State/Division of Corporations and it is effective. Preferred Stock The preferred stock authorized under the Company's certificate of incorporation may be issued from time to time in one or more series. As of December 31, 2025, no shares of preferred stock have been issued. The Company's board of directors have the full authority permitted by law to establish, without further stockholder approval, one or more series of preferred stock and the number of shares constituting each such series and to fix by resolution voting powers, preferences and relative, participating, optional and other special rights of each series of preferred stock, and the qualifications, limitations or restrictions thereof, if any. Subject to the limitation on the total number of shares of preferred stock that the Company has authority to issue under its certificate of incorporation, the board of directors …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing

"Subsequent Events On January 13, 2026, the Company entered into a securities purchase agreement (the Agreement) with an individual investor (the Holder) providing for the issuance of a 10% convertible promissory note (the Note) in the principal amount of $240,000 . The Convertible Note permits the Holder to convert outstanding principal and accrued interest into shares of common stock at a conversion price that is 75% of the trailing five-day volume weighted average price (""VWAP"") immediately preceding the respective conversion date. The Company received cash proceeds of $190,000 , which is net of original issue discount of $40,000 and issuance cost of $10,000 . The Note has a maturity date on January 13, 2027. Total payments of $264,000 will be made in four monthly installment payments, which won't be started until July 13, 2026 in accordance with the payment schedule pursuant to the note agreement. In consideration for entering into the Agreement, the Company also issued 80,000 shares of common stock to the Investor in connection with the Note. On January 27, 2026 (the Issue Date), the Company entered into a securities purchase agreement (the January Labrys SPA) with Labrys Fund II, LP (Labrys), pursuant to which the Company issued a 10% promissory note (the January Labrys Note) with a maturity date of January 27, 2027, in the principal sum of $180,000 . The Company received cash proceeds of $140,000 , which is net of original issue discount of $30,000 and issuance cost …

SubsequentEventsTextBlock · excerpt; the full note is in the filing

Note 3 - Asset Acquisition Stella Diagnostics - Asset Purchase Agreement On December 15, 2022, the Company entered into an Asset Purchase Agreement (the Stella Purchase Agreement), with Stella Diagnostics Inc. (Stella) and Stella DX, LLC (Stella DX and, together with Stella, the Stella Sellers), pursuant to which, on January 3, 2023, the Company purchased all of the assets, rights and interests of the Stella Sellers and their affiliates pertaining to the Stella Sellers BE-Smart Esophageal Pre-Cancer Diagnostic Screening Test and certain clinical assets, including all intellectual property rights (the Stella Purchased Assets). As consideration for the Stella Purchased Assets, at closing, the Company (i) paid to the Stella Sellers $ 3.5 million in cash, minus (a) the secured note Amount of $ 0.5 million, (b) the Liability Payoff Amount of $ 1.6 million and (c) the Promissory Note Payoff Amount of $ 0.4 million, and (ii) issued to Stella DX 10,000 shares of common stock, par value $ 0.0005 per share, of the Company at a value of $ 100.00 per share. Total consideration paid was $ 4.6 million. The Secured Note Amount of $ 0.5 million and the Promissory Note Payoff of $ 0.4 million were paid in 2022. The balance of the consideration was paid at closing on January 3, 2023. In addition to the consideration paid at closing, the Company will issue shares of common stock valued at $ 2.0 million (the Milestone Stock) to the Stella Sellers upon a Commercialization Event (as defined in the …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

Note 8 Commitments and Contingencies License Agreements Linebacker LB1 and LB2 In July 19, 2022, the Company through its wholly-owned subsidiary ProPhase BioPharma entered into a License Agreement (the Linebacker License Agreement) with Global BioLife, Inc. (the Licensor), with an effective date of July 18, 2022 (the Linebacker Effective Date), pursuant to which it acquired from Licensor a worldwide exclusive right and license under certain patents identified in the Linebacker License Agreement (the Licensed Patents) and know-how (collectively, the Licensed IP) to exploit any compound covered by the Licensed Patents (the Licensed Compound), including Linebacker LB1 and LB2, and any product comprising or containing a Licensed Compound (Licensed Products) in the treatment of cancer, inflammatory diseases or symptoms, memory-related syndromes, diseases or symptoms including dementia and Alzheimers Disease (the Field). Under the terms of the Linebacker License Agreement, the Licensor reserves the right, solely for itself and for GRDG Sciences, LLC (GRDG) to use the Licensed Compound and Licensed IP solely for research purposes inside the Field and for any purpose outside the Field. Subject to certain conditions set forth in the Linebacker License Agreement, the Company may grant sublicenses (including the right to grant further sublicenses) to its rights under the Linebacker License Agreement to any of its affiliates or any third party with the prior written consent of Licensor, …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

Note 5 - Outstanding Debt 2026 Convertible Notes On January 13, 2026, the Company entered into a securities purchase agreement (the Agreement) with an individual investor (the Holder) providing for the issuance of a 10 % convertible promissory note (the Note) in the principal amount of $ 240,000 . The Convertible Note permits the Holder to convert outstanding principal and accrued interest into shares of common stock at a conversion price that is 75 % of the trailing five -day volume weighted average price (VWAP) immediately preceding the respective conversion date. The Company received cash proceeds of $ 190,000 , which is net of original issue discount of $ 40,000 and issuance cost of $ 10,000 . The Note has a maturity date on January 13, 2027. Total payments of $ 264,000 will be made in four monthly installment payments, which wont be started until July 13, 2026 in accordance with the payment schedule pursuant to the note agreement. In consideration for entering into the Agreement, the Company also issued 80,000 shares of common stock to the Investor in connection with the Note. On January 27, 2026 (the Issue Date), the Company entered into a securities purchase agreement (the January Labrys SPA) with Labrys Fund II, LP (Labrys), pursuant to which the Company issued a 10 % promissory note (the January Labrys Note) with a maturity date of January 27, 2027, in the principal sum of $ 180,000 . The Company received cash proceeds of $ 140,000 , which is net of original issue di …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Note 15 - Fair Value Measurements The following table presents the fair value of the Companys financial liabilities that are measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025 (in thousands): Schedule of Fair Value of the Companys Financial Liabilities That are Measured at Fair Value On a Recurring Basis Level 1 Level 2 Level 3 Total As of March 31, 2026 Level 1 Level 2 Level 3 Total Derivative liability $ - $ - $ 490 $ 490 Level 1 Level 2 Level 3 Total As of December 31, 2025 Level 1 Level 2 Level 3 Total Derivative liability $ - $ - $ 50 $ 50 There were no transfers between Level 1, 2 or 3 during the three-month period ended March 31, 2026. The following table presents changes in Level 3 liabilities measured at fair value for the three-month period ended March 31, 2026. Both observable and unobservable inputs were used to determine the fair value of positions that the Company has classified within the Level 3 category. Unrealized gains and losses associated with liabilities within the Level 3 category include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable (e.g., changes in unobservable long- dated volatilities) inputs (in thousands). Schedule of Changes in Fair Value Derivative liability Balance at January 1, 2026 $ 50 Issuance of convertible debt 308 Debt amendment 418 Redemptions (372 ) Change in fair value 86 Balance at March 31, 2026 $ 490 A summary of the weig …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Note 7 Income Taxes We recognize tax assets and liabilities for future tax consequences related to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and for net operating loss carryforwards. Management evaluated the deferred tax assets for recoverability using a consistent approach that considers the relative impact of negative and positive evidence, including historical profitability and projections of future reversals of temporary differences and future taxable income. We are required to establish a valuation allowance for deferred tax assets if management determines, based on available evidence at the time the determination is made, that it is not more likely than not that some portion or all of the deferred tax assets will be realized. As a result of historical losses from continuing operations, we have recorded a full valuation allowance against the net deferred tax assets. Judgment is required to estimate forecasted future taxable income, which may be impacted by future business developments, actual results, tax initiatives, legislative, and other economic factors. The Company will continue to monitor income levels and potential changes to its operating and tax model, and other legislative or global developments in its determination. ProPhase Labs, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (unaudited) …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Recently Adopted Accounting Standards In November 2024, the FASB issued ASU 2024-04, Debt-Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments. This standard clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion and the application of the induced conversion guidance to a conversion debt instrument. It also clarifies that the incorporation, elimination, or modification of a daily volume-weighted average price (VWAP) formula does not automatically cause a settlement to be accounted for as an extinguishment. This standard will become effective on a prospective or retrospective basis for interim reporting periods and annual periods beginning after December 15, 2025. Early adoption is permitted. The Company adopted this guidance effective January 1, 2026 on a prospective basis. The adoption of this standard did not have a material impact on the Companys financial position, results of operations, or cash flows. …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Note 12 - Related Parties The Companys President of Nebula Genomics, Inc., is a related party to the Companys Chairman and Chief Executive Officer. For the three months ended March 31, 2026 and 2025, there were no payments made to the Executive Vice President outside compensation and benefits for the position held at the Company. On February 18, 2025, the company announced that Stuart Hollenshead was appointed to serve as Chief Operating Officer of the Company, effective on February 17, 2025. Mr. Hollenshead resigned his COO position effective July 31, 2025 and resumed his prior role with the Company in the role as a marketing consultant. Mr. Hollenshead serves as CEO of 10PM Curfew. The Company received consulting services from 10PM Curfew on an ongoing basis. For the three months ended March 31, 2026 and 2025, the Company did no t incur any consulting services from 10pm Curfew. Amounts payable 10PM Curfew as of March 31, 2026 was zero . The Company continues to utilize 10PM Curfew for consulting services. On June 22, 2025, the Company entered into a loan agreement with Ted Karkus, the Companys Chief Executive Officer and the Chairman of the Board of Directors, pursuant to which the Company issued a twelve-month non-convertible promissory note in the principal amount of $ 625,000 . The Company also issued 500,000 unvested warrants in conjunction with the note agreement. See Note 6 for detail description regarding the CEO Loan and the CEO Warrants. …

RelatedPartyTransactionsDisclosureTextBlock · excerpt; the full note is in the filing

Note 10 - Segment Information The Company has identified two operating segments, diagnostic services and consumer products, based on the manner in which the Companys CEO, as Chief Operating Decision Maker, assesses performance and allocates resources across the organization. The operating segments are organized in a manner that depicts the difference in revenue generating synergies that include the separate processes, profit generation and growth of each segment. The diagnostic services segment provides diagnostic information services to a broad range of customers in the United States, including health plans, third party payers and government organizations. The consumer products segment is engaged in the research, development, manufacture, distribution, marketing and sale of OTC consumer healthcare products and dietary supplements in the United States and also provides personal genomics products and services. The unallocated corporate expenses mainly included professional fees associated with the public company. ProPhase Labs, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (unaudited) The following table is a summary of segment information for three months ended March 31, 2026 and 2025 (amounts in thousands): Schedule of Segment Information March 31, 2026 March 31, 2025 For the three months ended March 31, 2026 March 31, 2025 As Restated Net revenues Diagnostic services $ - $ - Consumer products 1,169 1,431 Consolidated net revenue 1,169 1,431 Cost …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Note 2 - Summary of Significant Accounting Policies Basis of Presentation The unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles accepted in the United States of America (GAAP) for interim financial statements and the rules of the Securities and Exchange Commission (SEC) applicable to interim financial statements. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. The accompanying unaudited condensed consolidated financial statements have been prepared by management without audit and should be read in conjunction with our audited consolidated financial statements, including the notes thereto, appearing in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. In the opinion of management, all adjustments necessary for a fair presentation of the consolidated financial position, consolidated results of operations and other comprehensive loss and consolidated cash flows, for the periods indicated, have been made. The results of operations for the three months ended March 31, 2026 are not necessarily indicative of operating results that …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

Note 6 - Stockholders Equity Preferred Stock The preferred stock authorized under our certificate of incorporation may be issued from time to time in one or more series. As of March 31, 2026 and December 31, 2025, no shares of preferred stock had been issued. Common Stock Dividends No dividends were declared during the three ended March 31, 2026 and 2025. Common Stock Common ATM Offering On December 19, 2025, the Company entered into an Sales Agreement (the 2025 Sales Agreement) with WestPark Capital, Inc. (the WestPark), pursuant to which the Company may offer and sell, from time to time through WestPark, shares of our common stock having an aggregate offering price of up to $ 5.3 million, subject to the terms and conditions of the Sales Agreement. WestPark is entitled to a commission equal to 3 % of the gross sales price per share for all shares sold through it as our agent, and the Company will receive the net proceeds after deducting this commission and any offering expenses. During the three months ended March 31, 2026, the Company issued 163,900 shares of common stock pursuant to the 2025 Sales Agreement. The Company received cash proceeds of $ 40,000 , which was net of issuance cost of $ 30,000 . 2026 Equity Line of Credit Generating Alpha On January 16, 2026, the Company entered into a Stock Purchase Agreement (the Agreement) with Generating Alpha Ltd. (the Investor), pursuant to which the Investor committed to provide the Company with up to ten million dollars ($ 10, …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing

Note 17 - Subsequent Events On June 4, 2026, the Companys wholly-owned subsidiary, DNA Complete, Inc. (DNA Complete), entered into an agreement of sale of future receipts (the Third 2026 Future Receipts Financing Agreement) with Legendary Funding Group, LLC (Legendary), by which Legendary purchased from DNA Complete its future accounts and contract rights arising from the sale of goods or rendition of services to DNA Completes customers, equal to a specified percentage of future receipts. The purchase price was $ 60,000 , which was paid to DNA Complete net of a $ 6,000 origination fee, resulting in net proceeds of $ 54,000 . …

SubsequentEventsTextBlock · excerpt; the full note is in the filing