Celcuity Inc. (CELC)

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our unaudited condensed financial statements and the related notes included elsewhere in this Quarterly Report. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including information with respect to our plans and strategy for our business and expected financial results, includes forward-looking statements that involve risks and uncertainties. You should review the “Risk Factors” discussed in Part I, Item 1A of the 2025 10-K, and the cautionary statements elsewhere in this Quarterly Report, for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

We are a biotechnology company focused on developing and commercializing targeted therapies for the treatment of multiple solid tumor indications. Our first FDA-approved product is REVTORPYKTM (gedatolisib), a potent, pan-PI3K and mTORC1/2 inhibitor that comprehensively blockades the PAM pathway. Its mechanism of action and pharmacokinetic properties are differentiated from other currently approved and investigational therapies that target PI3Kα, AKT or mTORC1 alone or together. Our Phase 3 clinical trial, VIKTORIA-1, evaluated gedatolisib in combination with fulvestrant, with or without palbociclib, for the treatment of patients with HR+/HER2- ABC. Data from this trial is the basis for FDA approval of REVTORPYK for use in adult patients with HR+/HER2- ABC without a PIK3CA mutation detected following progression on or after treatment with at least one line of endocrine therapy in the metastatic setting. Results for the PIK3CA mutant cohort of the VIKTORIA-1 study have been released. Our Phase 3 clinical trial, VIKTORIA-2, is an ongoing trial incorporating two independent studies, Study 1 and Study 2, in two separate cohorts of patients with ABC who are treatment-naïve in the advanced setting. Study 1 is evaluating gedatolisib in combination with palbociclib and fulvestrant as first-line treatment for patients with endocrine-resistant HR+/HER2- ABC. Study 2 is evaluating gedatolisib in combination with palbociclib and letrozole as first-line treatment for patients with endocrine- sensitive HR+/HER2- ABC. A Phase 1b/2 clinical trial, CELC-G-201, evaluating gedatolisib in combination with darolutamide in patients with mCRPC, is ongoing.

Gedatolisib

In April 2021, we obtained exclusive global development and commercialization rights to gedatolisib under a license agreement with Pfizer. We believed gedatolisib’s unique mechanism of action, differentiated chemical structure, favorable pharmacokinetic properties, and intravenous route of administration offered distinct advantages over currently approved and investigational therapies that targeted PI3Kα, AKT, or mTORC1, alone or together.

•
Overcomes limitations of therapies that only inhibit a single class I PI3K isoform, AKT, or one mTOR kinase complex.

Gedatolisib is a pan-class I isoform PI3K inhibitor with low nanomolar potency for the p110α, p110β, p110γ, and p110δ isoforms and the mTORC1 and mTORC2 complexes. By targeting all class I PI3K isoforms and mTORC1/2, gedatolisib induces comprehensive inhibition of the PAM pathway. Each PI3K isoform and mTOR complex is known to preferentially affect different signal transduction events that involve tumor cell survival, depending upon the aberrations associated with the linked pathway. When a therapy only inhibits a single class I PI3K isoform (e.g., alpelisib, a PI3Kα inhibitor), AKT (e.g., capivasertib, an AKT inhibitor) or only one mTOR kinase complex (e.g., everolimus, an mTORC1 inhibitor), numerous feedforward and feedback loops between the PI3K isoforms and mTOR complexes cross-activate the uninhibited sub-units. This, in turn, induces compensatory resistance that reduces the efficacy of isoform specific PI3Kα, AKT, or mTORC1 kinase inhibitors. Inhibiting all four PI3K isoforms and both mTOR complexes, as gedatolisib does, thus prevents the confounding effect of isoform interaction that may occur with isoform-specific PI3K inhibitors and the confounding interaction between PI3K isoforms, AKT, and mTOR.

•
Better tolerated by patients than oral PI3K and mTOR drugs.

Gedatolisib is administered intravenously on a four-week cycle of three weeks-on, one week-off, in contrast to the orally administered pan-PI3K or dual PI3K/mTOR inhibitors that are no longer being clinically developed. Oral pan-PI3K or PI3K/mTOR inhibitors have repeatedly been found to induce significant side effects that were not well tolerated by patients. This typically leads to a high proportion of patients requiring dose reductions or treatment discontinuation. The challenging toxicity profile of these drug candidates ultimately played a significant role in the decisions to halt their development, despite showing promising efficacy. By contrast, gedatolisib’s comprehensive inhibition of the PAM pathway at low nanomolar potency, IV route of administration, and pharmacokinetic properties enables it to achieve optimal anti-proliferative effects on tumor cells without inducing the levels of hyperglycemia, rash, and diarrhea typically associated with oral single-component inhibitors of the PAM pathway.

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Isoform-specific PI3K or mTORC1 inhibitors administered orally were developed to reduce toxicities in patients. While the range of toxicities associated with single-component PAM inhibitors is narrower than oral pan-PI3K or PI3K/mTOR inhibitors, administering them orally on a continuous basis can still lead to challenging toxicities. The experience with an FDA-approved oral p110-α specific inhibitor, PIQRAY, illustrates the challenge. In its Phase 3 pivotal trial, PIQRAY was found to induce a Grade 3 or 4 adverse event (“AE”) related to hyperglycemia in 39% of patients evaluated. In addition, 26% of patients discontinued alpelisib due to AEs. By contrast, in the 103-patient dose expansion portion of the Phase 1b clinical trial with gedatolisib, only 7% of patients experienced Grade 3 or 4 hyperglycemia and less than 9% discontinued treatment.

FDA Approval of REVTORPYK

In January 2026, the FDA accepted the submission of our NDA for gedatolisib in HR+/HER2- PIK3CA WT ABC. The FDA granted Priority Review and assigned a PDUFA goal date of July 17, 2026. On July 14, 2026, the FDA approved the Company’s NDA for REVTORPYK (gedatolisib) in HR+/HER2- ABC, for use in adult patients without a PIK3CA mutation detected following progression on or after treatment with at least one line of endocrine therapy in the metastatic setting.

We subsequently announced that REVTORPYK in combination with fulvestrant, with or without palbociclib, was recommended by the National Comprehensive Cancer Network® (“NCCN®”) as a preferred Category 1 second-line and/or subsequent-line therapy for the treatment of patients with HR+/HER2- breast cancer without a PIK3CA mutation following progression on or after treatment with at least one line of endocrine therapy.

The build-out of the commercialization infrastructure needed to support a successful launch of REVTORPYK is complete and commercial launch activities for REVTORPYK commenced immediately after approval. Shipments of REVTORPYK are expected to begin late in the third quarter of 2026.

To make gedatolisib available to patients prior to commercial availability of REVTORPYK, in August 2026, we opened an Expanded Access Program ("EAP") to participating physicians on behalf of eligible patients, and we have begun to distribute gedatolisib to those physicians.

Market Opportunity

Based on our analysis of published epidemiological data, we estimate that approximately 37,000 patients in the U.S. are receiving second-line treatment for HR+/HER2- ABC. Using internal duration of treatment estimates and Wholesale Acquisition Cost (WAC) of REVTORPYK, we estimate the total addressable market for gedatolisib in the second-line setting is potentially more than $6.0 billion annually.

Clinical Development

As of June 30, 2026, at least 1,130 patients and healthy volunteers have received gedatolisib in 12 completed or ongoing clinical trials. Of these, 123 patients with solid tumors were treated with gedatolisib as a single agent in two clinical trials, 36 healthy volunteers were treated in two clinical trials, and the remaining 971 patients received gedatolisib in combination with other anti-cancer agents in eight clinical trials. Additional patients received gedatolisib in combination with other anti-cancer agents in 10 investigator-sponsored clinical trials.

HR+/HER2- Advanced Breast Cancer

B2151009 Phase 1b Trial

A Phase 1b dose-finding trial with an expansion portion for safety and efficacy evaluated gedatolisib when added to either the standard doses of palbociclib plus letrozole or palbociclib plus fulvestrant in patients with HR+/HER2- ABC. PI3K mutation status was not used as an eligibility criterion. Patient enrollment for the trial is complete.

A total of 138 patients with HR+/HER2- ABC were dosed in the clinical trial. As of June 30, 2026, four patients from this study continue to receive study treatment, each of whom has received study treatment for more than six years.

•
35 patients were enrolled in two dose escalation arms to evaluate the safety and tolerability and determine the maximum tolerable dose (“MTD”) of gedatolisib when used in combination with the standard doses of palbociclib and endocrine therapies. The MTD was determined to be 180 mg administered intravenously once weekly.

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•
103 patients were enrolled in one of four expansion arms (A, B, C, D) to determine if the triplet combination of gedatolisib plus palbociclib and letrozole or gedatolisib plus palbociclib and fulvestrant produced a superior objective response (OR), compared to historical control data of the doublet combination (palbociclib plus endocrine therapy). All patients received gedatolisib in combination with standard doses of palbociclib and endocrine therapy (either letrozole or fulvestrant). In Arms A, B, and C, patients received an intravenous dose of 180 mg of gedatolisib once weekly. In Arm D, patients received an intravenous dose of 180 mg of gedatolisib on a four-week cycle of three-weeks-on, one-week-off. Objective response was determined using Response Evaluation Criteria in Solid Tumors v1.0, or RECIST v1.0.

Source: Layman R., et. al, Lancet Oncol., 2024

VIKTORIA-1 Phase 3 Trial (Second-Line Setting)

Our Phase 3 clinical trial, VIKTORIA-1, evaluated gedatolisib in combination with fulvestrant, with or without palbociclib, for the treatment of patients with HR+/HER2- ABC, and is the basis for the FDA Approval. Over 200 clinical sites in North America, Europe, South America, and Asia-Pacific participated in the study.

The VIKTORIA-1 Phase 3 clinical trial involves two independent studies (Study 1 and Study 2) that enable separate evaluation of subjects according to their PIK3CA status. Subjects who met eligibility criteria and had PIK3CA WT tumors (Study 1) were randomly assigned (1:1:1) to receive a regimen of either gedatolisib, palbociclib, and fulvestrant (Arm A), gedatolisib and fulvestrant (Arm B), or fulvestrant (Arm C). The primary completion date and the database cut-off date for Study 1 was May 30, 2025. Subjects who met eligibility criteria and had PIK3CA MT tumors (Study 2) were randomly assigned (3:3:1) to receive a regimen of either gedatolisib, palbociclib, and fulvestrant (Arm D), alpelisib and fulvestrant (Arm E), or gedatolisib and fulvestrant (Arm F). The primary completion date and the database cut-off date for Study 2 was March 9, 2026.

PIK3CA Wild-Type Cohort

On July

[Excerpt truncated for page length; source filing is linked above.]

ITEM
7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You
should read the following discussion and analysis of our financial condition and results of operations together in conjunction with our
financial statements and the related notes included elsewhere in this Annual Report. Some of the information contained in this discussion
and analysis or set forth elsewhere in this Annual Report, including information with respect to our plans and strategy for our business
and expected financial results, includes forward-looking statements that involve risks and uncertainties. You should review the “Risk
Factors” discussed in Item 1A of Part I of this Annual Report.

Overview

Celcuity
is a clinical-stage biotechnology company focused on the development of targeted therapies for the treatment of multiple solid tumor
indications. The Company’s lead therapeutic candidate is gedatolisib, a kinase inhibitor of the phosphatidylinositol 3-kinase (“PI3K”),
serine/threonine-protein kinase protein kinase B (“AKT”), mechanistic target of rapamycin (“mTOR”) pathway that
binds to all class I PI3K isoforms and the mTOR complexes, mTORC1 and mTORC2. By targeting all class I PI3K isoforms and mTORC1/2, gedatolisib
induces comprehensive inhibition of the PI3K/AKT/mTOR (“PAM”) pathway. Its mechanism of action and pharmacokinetic properties
are differentiated from other currently approved and investigational therapies that target PI3Kα, AKT, or mTORC1 alone or together.
Our Phase 3 clinical trial, VIKTORIA-1, evaluating gedatolisib in combination with fulvestrant with or without palbociclib in patients
with hormone receptor-positive (HR+), human epidermal growth factor receptor 2-negative (HER2-) (“HR+/HER2-”) advanced breast
cancer (“ABC”) has completed enrollment and reported detailed results for cohort 1, patients with PIK3CA wild-type
(“WT”) tumors, and has completed enrollment of cohort 2, patients with PIK3CA mutant-type (“MT”) tumors.
Our Phase 3 clinical trial, VIKTORIA-2, evaluating gedatolisib in combination with a cyclin-dependent kinase (“CDK”) 4/6 inhibitor and fulvestrant
as first-line treatment for patients with endocrine treatment resistant HR+/HER2- ABC is ongoing. A Phase 1b/2
clinical trial, CELC-G-201, evaluating gedatolisib in combination with darolutamide in patients with metastatic castration resistant
prostate cancer (“mCRPC”), is ongoing.

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In
April 2021, we obtained exclusive global development and commercialization rights to gedatolisib under a license agreement with Pfizer.
We believe gedatolisib’s unique mechanism of action, differentiated chemical structure, favorable pharmacokinetic properties, and
intravenous route of administration offer distinct advantages over currently approved and investigational therapies that target PI3Kα,
AKT, or mTORC1 alone or together.

Gedatolisib
is a pan-class I isoform PI3K inhibitor with low nanomolar potency for the p110α, p110β, p110γ, and p110δ isoforms
and the mTORC1 and mTORC2 complexes. By targeting all class I PI3K isoforms and mTORC1/2, gedatolisib induces comprehensive inhibition
of the PAM pathway. Each PI3K isoform and mTOR complex is known to preferentially affect different signal transduction events that involve
tumor cell survival, depending upon the aberrations associated with the linked pathway. When a therapy only inhibits a single class I
PI3K isoform (e.g., alpelisib, a PI3Kα inhibitor), AKT (e.g., capivasertib, an AKT inhibitor) or only one mTOR kinase complex (e.g.,
everolimus, an mTORC1 inhibitor), numerous feedforward and feedback loops between the PI3K isoforms and mTOR complexes cross-activate
the uninhibited sub-units. This, in turn, induces compensatory resistance that reduces the efficacy of isoform specific PI3Kα,
AKT, or mTORC1 kinase inhibitors. Inhibiting all four PI3K isoforms and both mTOR complexes, as gedatolisib does, thus prevents the confounding
effect of isoform interaction that may occur with isoform-specific PI3K inhibitors and the confounding interaction between PI3K isoforms,
AKT, and mTOR.

Gedatolisib
is administered intravenously on a four-week cycle of three weeks-on, one week-off, in contrast to the orally administered pan-PI3K or
dual PI3K/mTOR inhibitors that are no longer being clinically developed. Oral pan-PI3K or PI3K/mTOR inhibitors have repeatably been found
to induce significant side effects that were not well tolerated by patients. This typically leads to a high proportion of patients requiring
dose reductions or treatment discontinuation. The challenging toxicity profile of these drug candidates ultimately played a significant
role in the decisions to halt their development, despite showing promising efficacy. By contrast, gedatolisib’s comprehensive inhibition
of the PAM pathway at low nanomolar potency, IV route of administration, and pharmacokinetic properties enables it to achieve optimal
anti-proliferative effects on tumor cells without inducing the levels of hyperglycemia, rash, and diarrhea typically associated with
oral single-component inhibitors of the PAM pathway.

Isoform-specific
PI3K or mTORC1 inhibitors administered orally were developed to reduce toxicities in patients. While the range of toxicities
associated with single-component PAM inhibitors is narrower than oral pan-PI3K or PI3K/mTOR inhibitors, administering them orally on a
continuous basis can still lead to challenging toxicities. The experience with an FDA-approved oral p110-α specific inhibitor,
PIQRAY, illustrates the challenge. In its Phase 3 pivotal trial, PIQRAY was found to induce a Grade 3 or 4 adverse event
(“AE”) related to hyperglycemia in 39% of patients evaluated. In addition, 26% of patients discontinued alpelisib due to
treatment related AEs. By contrast, in the 103-patient dose expansion portion of the Phase 1b clinical trial with gedatolisib, only
7% of patients experienced Grade 3 or 4 hyperglycemia and less than 9% discontinued treatment.

As
of December 31, 2025, 1,127 patients and healthy volunteers have received gedatolisib in 12 completed or ongoing clinical trials. Of
these, 123 patients with solid tumors were treated with gedatolisib as a single agent in two clinical trials, 36 healthy volunteers
were treated in two clinical trials, and the remaining 968 patients received gedatolisib in combination with other anti-cancer
agents in eight clinical trials. Additional patients received gedatolisib in combination with other anti-cancer agents in 10
investigator sponsored clinical trials.

B2151009
Phase 1b Trial

A Phase 1b dose-finding trial with
an expansion portion for safety and efficacy evaluated gedatolisib when added to either the standard doses of palbociclib plus letrozole
or palbociclib plus fulvestrant in patients with HR+/HER2- ABC. PI3K mutation status was not used as an eligibility criterion. Patient
enrollment for the trial is complete.

A total of 138 patients with HR+/HER2-
ABC were dosed in the clinical trial. Four patients from this study continue to receive study treatment, as of December
31, 2025, each of whom has received study treatment for more than six years.

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Source: Layman

SABCS 2021

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