cvm_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to __________.

Commission file number 1-11889

CEL-SCI CORPORATION

Colorado		84-0916344
State or other jurisdiction incorporation		(IRS) Employer Identification Number

8229 Boone Boulevard, Suite 802

Vienna, Virginia 22182

Address of principal executive offices

(703) 506-9460

Registrant's telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Common Stock		CVM		NYSE American

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) had been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes ☒ No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Exchange Act Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

Class of Stock		No. Shares Outstanding		Date
Common		91,037,256		May 9, 2025

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION

Item 1.		Page

	Condensed Balance Sheets at March 31, 2025 (unaudited) and September 30, 2024	3

	Condensed Statements of Operations for the six months ended March 31, 2025 and 2024 (unaudited)	4

	Condensed Statements of Operations for the three months ended March 31, 2025 and 2024 (unaudited)	5

	Condensed Statements of Stockholders’ Equity for the six months ended March 31, 2025 and 2024 (unaudited)	6

	Condensed Statements of Cash Flows for the six months ended March 31, 2025 and 2024 (unaudited)	8

	Notes to Condensed Financial Statements (unaudited)	10

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures about Market Risks	32

Item 4.	Controls and Procedures	32

PART II

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33

Item 5.	Other Information	33

Item 6.	Exhibits	33

	Signatures	34

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CEL-SCI CORPORATION

CONDENSED BALANCE SHEETS

ASSETS	March 31, 2025			September 30, 2024
	(UNAUDITED)
Current assets:
Cash and cash equivalents	$	1,924,305		$	4,738,173
Prepaid expenses		208,462			294,097
Supplies used for R&D and manufacturing		882,692			1,019,908
Deposits		7,500			3,500
Total current assets		3,022,959			6,055,678

Finance lease right-of-use assets		6,449,275			7,350,364
Operating lease right-of-use assets		1,388,025			1,495,937
Property and equipment, net		7,080,235			8,129,753
Patent costs, net		141,263			165,492
Deposits		2,319,101			2,319,101
Supplies used for R&D and manufacturing		1,406,475			1,475,441
Total assets	$	21,807,333		$	26,991,766

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	1,702,097		$	1,448,467
Accrued expenses		593,551			566,042
Due to employees		857,385			363,306
Finance lease liabilities, current portion		2,139,546			2,010,995
Operating lease liabilities, current portion		207,184			226,969
Total current liabilities		5,499,763			4,615,779

Finance lease liabilities, net of current portion		6,847,774			7,957,925
Operating lease liabilities, net of current portion		1,336,941			1,425,979
Other liabilities		125,000			125,000
Total liabilities		13,809,478			14,124,683

Commitments and contingencies

STOCKHOLDERS' EQUITY
Preferred stock, $0.01 par value; 200,000 shares authorized; 0 shares issued and outstanding		-			-
Common stock, $0.01 par value; 600,000,000 shares authorized; 84,349,756 and 63,787,104 shares issued and outstanding at March 31, 2025 and September 30, 2024, respectively		843,496			637,870
Additional paid-in capital		534,811,671			526,241,074
Accumulated deficit		(527,657,312	)		(514,011,861	)
Total stockholders' equity		7,997,855			12,867,083

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	21,807,333		$	26,991,766

See notes to condensed financial statements.

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CEL-SCI CORPORATION

CONDENSED STATEMENTS OF OPERATIONS

SIX MONTHS ENDED MARCH 31, 2025 and 2024

(UNAUDITED)

	2025			2024

Operating expenses:
Research and development	$	8,444,328		$	8,981,044
General and administrative		4,843,193			4,580,791
Total operating expenses		13,287,521			13,561,835

Operating loss		(13,287,521	)		(13,561,835	)

Interest expense, net		(348,389	)		(380,397	)
Other expense		(9,541	)		(12,183	)
Net loss	$	(13,645,451	)	$	(13,954,415	)

Net loss available to common shareholders	$	(13,645,451	)	$	(13,954,415	)

Net loss per common share – basic and diluted	$	(0.18	)	$	(0.28	)
Weighted average common shares outstanding – basic and diluted		74,827,420			50,228,860

See notes to condensed financial statements.

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CEL-SCI CORPORATION

CONDENSED STATEMENTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 2025 and 2024

(UNAUDITED)

	2025			2024

Operating expenses:
Research and development	$	4,014,265		$	4,628,535
General and administrative		2,379,838			2,447,413
Total operating expenses		6,394,103			7,075,948

Operating loss		(6,394,103	)		(7,075,948	)

Interest expense, net		(178,286	)		(182,701	)
Other income (expense)		-			13,758
Net loss	$	(6,572,389	)	$	(7,244,891	)

Net loss available to common shareholders	$	(6,572,389	)	$	(7,244,891	)

Net loss per common share – basic and diluted	$	(0.08	)	$	(0.14	)
Weighted average common shares outstanding – basic and diluted		84,540,132			52,006,442

See notes to condensed financial statements.

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CEL-SCI CORPORATION

STATEMENT OF STOCKHOLDERS' EQUITY

(UNAUDITED)

							Additional
	Common Stock						Paid-In			Accumulated
	Shares			Amount			Capital			Deficit			Total

BALANCE, SEPTEMBER 30, 2024		63,787,104		$	637,870		$	526,241,074		$	(514,011,861	)	$	12,867,083

Pre-funded warrant exercises		1,450,000			14,500			(14,500	)		-			-
401 (k) contributions paid in common stock		142,822			1,428			55,706			-			57,134
Stock issued to nonemployees for service		154,615			1,546			394,541			-			396,087
Proceeds from the sale of common stock		7,552,500			75,525			4,924,775			-			5,000,300
Equity based compensation - employees		(3,000	)		(30	)		711,411			-			711,381
Share issuance costs		-			-			(650,291	)		-			(650,291	)
Net loss		-			-			-			(7,073,062	)		(7,073,062	)
BALANCE, DECEMBER 31, 2024		73,084,041		$	730,839		$	531,662,716		$	(521,084,923	)	$	11,308,632

Pre-funded warrant exercises		5,977,500			59,775			(59,775	)		-			-
401 (k) contributions paid in common stock		225,715			2,257			51,797			-			54,054
Stock issued to nonemployees for service		50,000			500			59,702			-			60,202
Proceeds from the sale of common stock		4,012,500			40,125			2,519,875			-			2,560,000
Shares issued for settlement of clinical development costs		1,000,000			10,000			340,885			-			350,885
Equity based compensation - employees		-			-			685,668			-			685,668
Share issuance costs		-			-			(449,197	)		-			(449,197	)
Net loss		-			-			-			(6,572,389	)		(6,572,389	)
BALANCE, MARCH 31, 2025		84,349,756		$	843,496		$	534,811,671		$	(527,657,312	)	$	7,997,855

See notes to condensed financial statements.

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CEL-SCI CORPORATION

STATEMENT OF STOCKHOLDERS' EQUITY

(UNAUDITED)

					Additional
	Common Stock				Paid-In			Accumulated
	Shares		Amount		Capital			Deficit			Total

BALANCE, SEPTEMBER 30, 2023		47,422,304	$	474,223	$	499,832,063		$	(487,091,396	)	$	13,214,890

401 (k) contributions paid in common stock		17,724		177		48,730			-			48,907
Stock issued to nonemployees for service		88,573		886		201,421			-			202,307
Proceeds from the sale of common stock		2,490,000		24,900		4,955,100			-			4,980,000
Equity based compensation – employees		-		-		1,383,909			-			1,383,909
Share issuance costs		-		-		(470,229	)		-			(470,229	)
Net loss		-		-		-			(6,709,524	)		(6,709,524	)
BALANCE, DECEMBER 31, 2023		50,018,601	$	500,186	$	505,950,994		$	(493,800,920	)	$	12,650,260

401(k) contributions paid in common stock		27,373		274		53,211			-			53,485
Stock issued to nonemployees for service		162,744		1,627		379,243			-			380,870
Proceeds from the sale of common stock		3,875,000		38,750		7,711,250			-			7,750,000
Equity based compensation – employees		-		-		1,432,540			-			1,432,540
Share issuance costs		-		-		(717,621	)		-			(717,621	)
Net loss		-		-		-			(7,244,891	)		(7,244,891	)
BALANCE, MARCH 31, 2024		54,083,718	$	540,837	$	514,809,617		$	(501,045,811	)	$	14,304,643

See notes to condensed financial statements.

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CEL-SCI CORPORATION

CONDENSED STATEMENTS OF CASH FLOWS

SIX MONTHS ENDED MARCH 31, 2025 and 2024

(UNAUDITED)

	2025			2024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(13,645,451	)	$	(13,954,415	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		1,965,294			1,993,395
Non-cash lease expense		(911	)		4,383
Share-based payments for services		506,760			547,893
Equity based compensation		1,397,050			2,816,449
Common stock contributed to 401(k) plan		111,188			102,392
Shares issued for settlement of clinical development costs		350,885			-
Loss on patent impairment		9,541			-
(Increase)/decrease in assets:
Prepaid expenses		35,163			(30,996	)
Supplies used for R&D and manufacturing		206,182			(240,067	)
Deposits		(4,000	)		(11,884	)
Increase/(decrease) in liabilities:
Accounts payable		104,209			(896,939	)
Accrued expenses		(39,541	)		59,818
Due to employees		494,079			194,363

Net cash used in operating activities		(8,509,552	)		(9,415,608	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		(32,954	)		(51,650	)
Expenditures for patent costs		-			(13,211	)

Net cash used in investing activities		(32,954	)		(64,861	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock and pre-funded warrants		7,560,300			12,730,000
Payments of stock issuance costs		(850,391	)		(1,218,937	)
Payments on obligations under finance leases		(981,271	)		(867,008	)

Net cash provided by financing activities		5,728,638			10,644,055

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(2,813,868	)		1,163,586

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		4,738,173			4,145,735

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	1,924,305		$	5,309,321

See notes to condensed financial statements.

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CEL-SCI CORPORATION

CONDENSED STATEMENTS OF CASH FLOWS

SIX MONTHS ENDED MARCH 31, 2025 and 2024

(UNAUDITED)

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:	2025		2024
Finance lease obligation included in accounts payable	$	1,649	$	522
Assets purchased under finance leases	$	-	$	20,797
Obligations paid with issuance of common stock	$	456,289	$	583,177
Accrued consulting services to be paid with common stock	$	-	$	165,000
Financing costs included in current liabilities	$	288,047	$	46,616

SUPPLEMENTAL DISCLOSURE OF CASH FLOWS:
Cash paid for interest	$	404,557	$	480,044

See notes to condensed financial statements.

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CEL-SCI CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

SIX MONTHS ENDED MARCH 31, 2025 and 2024 (UNAUDITED)

A. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying condensed financial statements of CEL-SCI Corporation (the “Company”) are unaudited and certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to the rules and regulations of the Securities and Exchange Commission. While management of the Company believes that the disclosures presented are adequate to make the information presented not misleading, these interim condensed financial statements should be read in conjunction with the financial statements and notes included in the Company’s annual report on Form 10-K for the year ended September 30, 2024.

In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments (all of which are of a normal recurring nature) and disclosures necessary for a fair presentation of the Company’s financial position as of March 31, 2025 and the results of its operations for the six months then ended. The condensed balance sheet as of September 30, 2024 is derived from the September 30, 2024 audited financial statements.

Due to recurring losses from operations and future liquidity needs, there is substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Refer to discussion in Note B.

Summary of Significant Accounting Policies:

Cash and Cash Equivalents – Cash and cash equivalents consist principally of unrestricted cash on deposit and short-term money market funds. The Company considers all highly liquid investments with a maturity when purchased of less than three months to be cash equivalents.

Property and Equipment – Property and equipment is recorded at cost and depreciated using the straight-line method over estimated useful lives of five to seven years. Leasehold improvements are depreciated over the shorter of the estimated useful life of the asset or the term of the lease. Repairs and maintenance which do not extend the life of the asset are expensed when incurred. Property and equipment is reviewed on a quarterly basis to determine if any of the assets are impaired.

Supplies used for R&D and manufacturing – Supplies are consumable items kept on hand to support the Company’s R&D and manufacturing operations. Supplies are recorded at the lower of cost or net realizable value and are charged to expense as they are used in operations. The Company regularly reviews the quality and utilization of supplies to determine if future use of these supplies is probable. Due to the generic use of these supplies, they can be used in multiple projects other than those currently being studied. Supplies held less than twelve months are classified as current assets and supplies held longer than twelve months are classified as non-current assets.

Patents – Patent expenditures are capitalized and amortized using the straight-line method over the shorter of the expected useful life or the legal life of the patent (17 years). In the event changes in technology or other circumstances impair the value or life of the patent, appropriate adjustments to the asset value and period of amortization are made. An impairment loss is recognized when estimated future undiscounted cash flows expected to result from the use of the asset, and from its disposition, are less than the carrying value of the asset. The amount of the impairment loss would be the difference between the estimated fair value of the asset and its carrying value.

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Leases – The Company accounts for contracts that convey the right to control the use of identified property, plant or equipment over a period of time in exchange for consideration as leases upon inception. The Company leases certain real estate, machinery, laboratory equipment and office equipment over varying periods. Many of these leases include an option to either renew or terminate the lease. For purposes of calculating lease liabilities, these options are included in the lease term when it is reasonably certain that the Company will exercise such options. The incremental borrowing rate utilized to calculate the lease liabilities is based on the information available at the commencement date, as most of the leases do not provide an implicit borrowing rate. The incremental borrowing rate reflects the rate of interest that the Company would pay on the lease commencement date to borrow an amount equal to the lease payments on a collateralized basis over a similar term in similar economic environments. Short-term leases, defined as leases with initial terms of 12 months or less, are not reflected on the balance sheet. Lease expense for such short-term leases is not material. Operating and finance lease agreements which require payments for lease and non-lease components are accounted for as a single lease component. Variable lease payments that cannot be determined at the commencement of the lease are not included in the calculation of right-of-use assets or lease liabilities, and are expensed as incurred.

Share-Based Compensation – Compensation cost for all share-based awards is measured at fair value as of the grant date in accordance with the provisions of ASC 718, Compensation – Stock Compensation (“ASC 718”). The fair value of stock options is calculated using the Black-Scholes option pricing model. The Black-Scholes model requires five input variables: the strike price of an option, the current stock price, the time to expiration, the risk-free rate, and the volatility. The share-based compensation cost is recognized using the straight-line method as expense over the requisite service or vesting period.

The Company has Incentive Stock Option Plans, Non-Qualified Stock Option Plans, Stock Compensation Plans, Stock Bonus Plans and an Incentive Stock Bonus Plan. These Plans are collectively referred to as the “Plans”. All Plans have been approved by the Company’s stockholders.

The Company’s stock options are not transferable, and the actual value of the stock options that an employee may realize, if any, will depend on the excess of the market price on the date of exercise over the exercise price. For options issued with service conditions only, the Company has based its assumption for stock price volatility on the variance of daily closing prices of the Company’s stock. The risk-free interest rate assumption is based on the U.S. Treasury rate at the date of grant with the term equal to the expected life of the option. Forfeitures are accounted for when they occur. The expected term of options represents the period that options granted are expected to be outstanding and has been determined based on an analysis of historical exercise behavior. If any of the assumptions used in the Black-Scholes model change significantly, share-based compensation expense for new awards may differ materially in the future from that recorded in the current period.

Restricted stock granted under the Incentive Stock Bonus Plan and options granted under the Non-Qualified Stock Option Plans are subject to service, performance and market conditions and meet the classification of equity awards. These awards were measured at fair value on the grant dates using a Monte Carlo simulation for issuances where the attainment of performance criteria is uncertain. The total compensation cost will be expensed over the estimated requisite service period.

Research and Development Costs – Research and development costs are expensed as incurred. Management accrues Clinical Research Organization (“CRO”) expenses and clinical trial study expenses based on services performed and relies on the CROs to provide estimates of those costs applicable to the completion stage of a study. Estimated accrued CRO costs are subject to revisions as such studies progress to completion. The Company records revisions to estimated expense in the period in which the facts that give rise to the revision become known.

Net Loss Per Common Share – The Company calculates net loss per common share in accordance with ASC 260, Earnings Per Share. Basic and diluted net loss per common share was determined by dividing net loss applicable to common shareholders by the weighted average number of common shares outstanding during the period. The Company’s potentially dilutive shares, which include outstanding common stock options, unvested restricted stock and common stock warrants, have not been included in the computation of diluted net loss per share for all periods as the result would be anti-dilutive.

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Concentration of Credit Risk – Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash and cash equivalents. The Company maintains its cash and cash equivalents with high quality financial institutions. At times, these accounts may exceed federally insured limits. The Company has not experienced any losses in such bank accounts. The Company believes it is not exposed to significant credit risk related to cash and cash equivalents. All non-interest bearing account balances were fully insured up to $250,000 at March 31, 2025 and September 30, 2024.

Income Taxes – The Company accounts for income taxes in accordance with the provisions of ASC 740, Income Taxes, on a tax jurisdiction basis. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating and tax loss carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company records a valuation allowance to reduce the deferred tax assets to the amount that is more likely than not to be recognized. A full valuation allowance was recorded against the deferred tax assets as of March 31, 2025 and September 30, 2024.

Impairment of long-lived assets – CEL-SCI’s fixed assets are made up of leasehold improvements, furniture, and equipment. ASC 360-10 requires that a long-lived asset group be reviewed for impairment only when events or changes in circumstances indicate that the carrying amount of the long-lived asset (group) might not be recoverable. CEL-SCI’s recurring losses are a triggering event that could indicate impairment of long-lived assets such as fixed assets. CEL-SCI reviews these assets to determine if events or changes in circumstances indicate the existence of impairment. If indicators of impairment exist, the Company tests for recoverability, then, if necessary, measures and records the impairment. The amount of the impairment loss would be the amount by which the carrying amount of the asset (group) exceeds its fair value.

Fair Value Measurements - In accordance with the provisions of ASC 820, Fair Value Measurements, the Company determines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company generally applies the income approach to determine fair value. This method uses valuation techniques to convert future amounts to a single present amount. The measurement is based on the value indicated by current market expectations with respect to the future amounts.

ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to active markets for identical assets and liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The Company classifies fair value balances based on the observability of those inputs. The three levels of the fair value hierarchy are as follows:

	·	Level 1 – Observable inputs such as quoted prices in active markets for identical assets or liabilities

	·	Level 2 – Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and amounts derived from valuation models where all significant inputs other than quoted prices that are observable for the asset or liability are observable in active markets

	·	Level 3 – Unobservable inputs that reflect management’s assumptions

For disclosure purposes, assets and liabilities are classified in their entirety in the fair value hierarchy level based on the lowest level of input that is significant to the overall fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the placement within the fair value hierarchy levels.

The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments. The Company’s money market funds included in cash equivalents are valued using Level 1 inputs and measured at fair value on a recurring basis. The cost of the Company’s money market funds approximated their fair value at $1,000 and $3,480,000 as of March 31, 2025 and September 30, 2024, respectively.

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Use of Estimates – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying disclosures. These estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future. Estimates are used in accounting for, among other items, share-based compensation, useful lives for depreciation and amortization of long-lived assets, right-of-use assets and lease liabilities, deferred tax assets and the related valuation allowance. Actual results could differ from estimates, although management does not generally believe such differences would materially affect the financial statements in any given year. Additionally, in calculating the right-of-use assets and lease liabilities, estimates and assumptions were used to determine the incremental borrowing rates and the expected lease terms. The Company considers the estimates used in valuing the stock options and the lease assets and liabilities to be significant.

New Accounting Pronouncements

In November 2023, the FASB issued Accounting Standards Update No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which expands disclosures about a public entity’s reportable segments and requires more enhanced information about a reportable segment’s expenses, interim segment profit or loss, and how a public entity’s chief operating decision maker uses reported segment profit or loss information in assessing segment performance and allocating resources. The update will be effective for annual periods beginning after December 15, 2023 and interim periods beginning after December 15, 2024. The Company is currently evaluating the impact that this change will have on the Company’s disclosures.

In December 2023, the FASB issued Accounting Standards Update No. 2023-09, Improvements to Income Tax Disclosures, which require greater disaggregation of income tax disclosures related to the income tax rate reconciliation and income taxes paid. The update will be effective for annual periods beginning after December 15, 2024. The guidance should be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. The Company is currently evaluating the impact that this change will have on the Company's disclosures.

In March 2024, the SEC issued its final climate disclosure rules, which require the disclosure of climate-related information in annual reports and registration statements. The rules require disclosure in the audited financial statements of certain effects of severe weather events and other natural conditions above certain financial thresholds, as well as amounts related to carbon offsets and renewable energy credits or certificates, if material. Under the rules as originally issued, disclosure requirements begin phasing in for fiscal years beginning on or after January 1, 2027. However, on April 4, 2024, the SEC determined to voluntarily stay the final rules pending certain legal challenges. The Company is currently evaluating the impact of new rules and continue to monitor the status of the related legal challenges.

In November 2024, the FASB issued Accounting Standards Update No. 2024-03, Income Statement – Reporting Comprehensive income – Expense Disaggregation Disclosures: Disaggregation of Income Statement Expenses (“ASU 2024-03”). ASU 2024-03 will require more detailed information about the types of expenses in commonly presented income statement captions such as “Cost of sales” and “Selling, general and administrative expenses”. The new guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027 with early adoption permitted. The Company is currently evaluating the impact that this change will have on the Company’s disclosures.

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B. LIQUIDITY

The Company has incurred significant costs since its inception for the acquisition of certain proprietary technology and scientific knowledge relating to the human immunological defense system, patent applications, research and development, administrative costs, construction and expansion of manufacturing and laboratory facilities and conducting clinical trials. The Company has funded such costs primarily with proceeds from loans and the public and private sale of its securities. The Company will be required to raise additional capital or find additional long-term financing to continue with its efforts to bring Multikine, the Company’s lead investigational therapy, to market. The ability to raise capital may be dependent upon market conditions that are outside the control of the Company. The ability of the Company to obtain approval from any regulatory agency for the sale of products to be developed on a commercial basis is uncertain. Ultimately, the Company must complete the development of its products, obtain the appropriate regulatory approvals and obtain sufficient revenues to support its cost structure.

To finance the Company through marketing approval, the Company plans to raise additional capital in the form of corporate partnerships, and debt and/or equity financings. The Company believes that it will be able to obtain additional financing because it has done so consistently in the past and because Multikine showed great survival benefit in the Phase 3 study in one of the two treatment arms for advanced primary head and neck cancer. However, there can be no assurance that the Company will be successful in raising additional funds on a timely basis or that the funds will be available to the Company on acceptable terms or at all. If the Company does not raise the necessary amounts of money, it may have to curtail its operations until such time as it is able to raise the required funding.

Due to the Company’s recurring losses from operations and future liquidity needs, there is substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

C. STOCKHOLDERS’ EQUITY

Proceeds from the Sale of Common Stock

In March 2025, the Company sold 4,012,500 shares of common stock at an offering price of $0.16 per share and pre-funded warrants to purchase up to 11,987,500 shares of common stock, at an offering price of $0.1599 per pre-funded warrant, for proceeds of approximately $2.6 million, net of issuance costs of approximately $0.4 million. As of March 31, 2025, none of the pre-funded warrants in connection with the March 2025 offering have been exercised.

In December 2024, the Company sold 7,552,500 shares of common stock at an offering price of $0.31 per share and pre-funded warrants to purchase up to 8,577,500 shares of common stock, at an offering price of $0.3099 per pre-funded warrant, for proceeds of approximately $4.4 million, net of issuance costs of approximately $0.6 million. As of March 31, 2025, 5,977,500 of the pre-funded warrants in connection with the December 2024 offering have been exercised.

The Company determined that the pre-funded warrants sold in the March 2025 and December 2024 offerings are freestanding financial instruments because they are both legally detachable and separately exercisable from the common stock sold in the offering. As such, the Company evaluated the pre-funded warrants to determine whether they represent instruments that require liability classification pursuant to the guidance in ASC 480. However, the Company concluded that the pre-funded warrants are not a liability within the scope of ASC 480 due to their characteristics. Further, the Company determined that the pre-funded warrants do not meet the definition of a derivative under ASC 815. Accordingly, the Company assessed the pre-funded warrants relative to the guidance in ASC No. 815-40, Contracts in Entity’s Own Equity, to determine the appropriate treatment. The Company concluded that the pre-funded warrants are both indexed to its own stock and meet all other conditions for equity classification. Accordingly, the Company has classified the pre-funded warrants as permanent equity and recorded them as a component of additional paid-in capital upon the closing of the financings.

In February 2024, the Company sold 3,875,000 shares of common stock at a public offering price of $2.00 per share and received proceeds of approximately $7.0 million, net of issuance costs of approximately $0.7 million.

In November 2023, the Company sold 2,490,000 shares of common stock at a public offering price of $2.00 per share and received proceeds of approximately $4.5 million, net of issuance costs of approximately $0.5 million.

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Other Equity Transactions

In October 2024, the Company entered into a Securities Purchase Agreement with Ergomed Group Limited (“Ergomed”) pursuant to which the Company issued 1,000,000 shares of common stock in exchange for services. The shares are legally issued and outstanding. The Company determined the issuance of shares to a non-employee for services rendered or to be rendered is within the scope of ASC 718. In accordance with ASC 718, the shares were not issued and outstanding for accounting purposes as they are unvested and forfeitable. The shares will be recognized on the settlement date and measured at fair value when the shares are settled for services rendered by Ergomed. The Company incurred share issuance costs of approximately $61,000 to issue the shares from this agreement which were immediately expensed. During the three months ended March 31, 2025, 1,000,000 shares were sold by Ergomed and the proceeds used to settle $350,885 in outstanding payables for services provided to the Company.

Equity Compensation

Underlying share information for equity compensation plans as of March 31, 2025 is as follows:

Name of Plan	Total Shares Reserved Under Plans
Incentive Stock Option Plans		138,400
Non-Qualified Stock Option Plans		17,787,200
Stock Bonus Plans		1,283,760
Stock Compensation Plans		634,000
Incentive Stock Bonus Plan		640,000

Stock Option Activity:

	Six Months Ended March 31,
	2025		2024
Options granted		503,500		3,000
Options exercised		-		-
Options forfeited		27,666		53,000
Options expired		40		27,035

	Three Months Ended March 31,
	2025		2024
Options granted		1,000		3,000
Options exercised		-		-
Options forfeited		11,833		42,000
Options expired		-		27,035

On March 1, 2024, the Company accelerated the vesting of 234,332 stock options issued to directors to vest on April 19, 2024. The Company concluded that the change in vesting of the options should be treated as a modification in accordance with ASC 718. As such, the Company revalued the options as of March 1, 2024 (the modification date) and subtracted any compensation cost already recognized prior to the modification date. This resulted in remaining compensation cost of approximately $260,000 that will be amortized on a straight-line basis over the remaining service period.

Share-Based Compensation Expense:

	Six Months Ended March 31,
	2025		2024
Employees	$	1,397,050	$	2,816,449
Non-employees	$	506,760	$	370,163

	Three Months Ended March 31,
	2025		2024
Employees	$	685,668	$	1,432,540
Non-employees	$	109,921	$	151,777

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Employee compensation expense includes the expense related to options and restricted stock that is expensed over the vesting periods. Non-employee expense includes the expense related to options and stock issued to consultants expensed over the period of the related service contracts.

Warrants and Non-Employee Options

The following chart represents the warrants and non-employee options outstanding at March 31, 2025:

Warrant/ Options	Issue Date	Shares Issuable upon Exercise of Warrants/ Options	Exercise Price	Expiration Date
Series N	8/18/2008	85,339	$3.00	8/18/2026
Series UU	6/11/2018	93,603	$2.80	6/30/2026
Series X	1/13/2016	120,000	$9.25	7/13/2026
Series Y	2/15/2016	26,000	$12.00	8/15/2026
Series MM	6/22/2017	333,432	$1.86	6/22/2026
Series NN	7/24/2017	200,087	$2.52	7/24/2026
Series RR	10/30/2017	234,009	$1.65	10/30/2026
Pre-Funded	12/31/2024	2,600,000	$0.0001	N/A
Pre-Funded	03/18/2025	11,987,500	$0.0001	N/A
Consultant Options	7/28/2017 – 11/19/2024	610,000	$0.70 - $2.18	7/27/2027 - 11/1/2034

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1. Equity Warrants

Changes in Equity Warrants

During the six months ended March 31, 2025, 11,987,500 and 8,577,500 pre-funded warrants at an offering price of $0.1599 and $0.3099, respectively, were issued. No pre-funded warrants or warrants recorded as equity were issued during the six months ended March 31, 2024.

During the six months ended March 31, 2025, 7,427,500 pre-funded warrants were exercised. No pre-funded warrants or warrants recorded as equity were exercised during the six months ended March 31, 2024.

No warrants recorded as equity expired or were extended during the six months ended March 31, 2025 and 2024.

2. Options and Shares Issued to Consultants

During the six months ended March 31, 2025 and 2024, the Company issued 204,615 and 251,317 shares, respectively, of restricted common stock to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $0.87 and $1.99 during the six months ended March 31, 2025 and 2024, respectively. During the three months ended March 31, 2025 and 2024, the Company issued 50,000 and 162,744 shares, respectively, of restricted common stock to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $0.94 and $2.22 during the three months ended March 31, 2025 and 2024, respectively.

During the six months ended March 31, 2025, 500,000 options with an exercise price of $0.70 were issued to a consultant. The options vest immediately and will expire on November 1, 2034. No options were issued to a consultant during the six months ended March 31, 2024.

During the six months ended March 31, 2025 and 2024, the Company recorded total expense of approximately $507,000 and $370,000, respectively, relating to the share-based compensation under various consulting agreements. During the three months ended March 31, 2025 and 2024, the Company recorded total expense of approximately $110,000 and $152,000, respectively, relating to the share-based compensation under various consulting agreements. On March 31, 2025 and September 30, 2024, consulting fees of approximately $1,000 and $52,000, respectively, are included in current assets as prepaid expenses and will be amortized over the remaining service periods.

D. RELATED PARTY TRANSACTIONS

There were no related party transactions during the six months ended March 31, 2025 and 2024.

E. COMMITMENTS AND CONTINGENCIES

Clinical Research Agreements

In August 2024 the Company entered into an agreement, pursuant to which the Company engaged Ergomed Clinical Research, Inc. to provide clinical development services related to the Company’s upcoming confirmatory registration study in exchange for fees. Since the Company entered into this agreement it has incurred research and development expenses of approximately $0.7 million as of March 31, 2025.

Lease Agreements

The Company leases a manufacturing facility near Baltimore, Maryland (the San Tomas lease). The building was remodeled in accordance with the Company’s specifications so that it can be used by the Company to manufacture Multikine for the Company’s Phase III clinical trial and sales of the drug if approved by the FDA or regulators in Canada, the UK or Europe. The lease is for a term of twenty years and requires annual base rent to escalate each year at 3%. The Company is required to pay all real estate and personal property taxes, insurance premiums, maintenance expenses, repair costs and utilities. The lease allows the Company, at its election, to extend the lease for two ten-year periods or to purchase the building at the end of the 20-year lease, which expires in October 2028. The renewal options are not included in the calculation of the right-of-use asset and lease liability because exercise of those options is not reasonably certain.

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As of March 31, 2025 and September 30, 2024, respectively, the net book value of the finance lease right-of-use asset is approximately $6.4 million and $7.4 million and the balance of the finance lease liability is approximately $9.0 million and $10.0 million, of which approximately $2.1 million and $2.0 million is current. These amounts include the San Tomas lease as well as several other smaller finance leases for office equipment. During the six months ended March 31, 2025 and 2024, the finance right-of-use assets are being depreciated using a straight-line method over the underlying lease terms and depreciation expense totaled approximately $0.9 million in both periods, which is included in research and development expense on the accompanying condensed statements of operations. Total cash paid related to finance leases during the six months ended March 31, 2025 and 2024, was approximately $1.4 million and $1.3 million, respectively, of which approximately $0.4 million and $0.5 million was for interest, respectively. The total cash paid related to finance lease principal payments is included in cash flows from financing activities on the accompanying condensed statements of cash flows. The total cash paid related to finance lease interest expense is included in cash flows from operating activities on the accompanying condensed statements of cash flows. As of March 31, 2025, the weighted average discount rate of the Company’s finance leases is 8.46% and the weighted average remaining lease term is 3.59 years. During the six months ended March 31, 2025 and 2024, total finance lease costs were approximately $1.3 million and $1.4 million, respectively, consisting of approximately $0.9 million of lease asset amortization for both periods and approximately $0.4 million and $0.5 million of interest on the finance lease liabilities, respectively. Variable lease expenses, such as maintenance costs, utilities, and real property taxes are not included in right-of-use assets or lease liabilities but rather are expensed as incurred. During the six months ended March 31, 2025, there were approximately $0.5 million of variable finance lease costs, which are included in research and development expense on the accompanying condensed statements of operations.

On January 11, 2023, the Company was required to deposit approximately $2.3 million to its landlord, equivalent to one year’s rent, for falling below the stipulated cash threshold in accordance with the San Tomas lease. The amount will be included as an asset on the balance sheet until the Company meets the minimum cash balance required and the deposit is returned.

Approximate future minimum lease payments under finance leases as of March 31, 2025 are as follows:

Six months ending September 30, 2025	$	1,377,000
Year ending September 30,
2026		2,838,000
2027		2,929,000
2028		3,021,000
2029		255,000
2030		-
Total future minimum lease obligation		10,420,000
Less imputed interest on finance lease obligations		(1,432,000	)
Net present value of financing lease obligations		8,988,000
Less net present value of financing lease obligations – current portion		(2,140,000	)
Net present value of financing lease obligations – non-current portion	$	6,848,000

The Company leases two facilities under operating leases. The lease for the Company’s office headquarters will expire on November 30, 2025. The lease for its research and development laboratory will expire on February 29, 2032. The operating leases include escalating rental payments. The Company is recognizing the related rent expense on a straight-line basis over the terms of the leases.

As of March 31, 2025 and September 30, 2024, respectively, the net book value of the operating lease right-of-use asset is approximately $1.4 million and $1.5 million and the balance of the operating lease liability is approximately $1.5 million and $1.7 million, of which approximately $0.2 million is current in both periods. During the six months ended March 31, 2025 and 2024, the Company incurred lease expense under operating leases of approximately $0.1 million and $0.2 million, respectively, which is included in general and administrative expense on the accompanying condensed statements of operations. Total cash paid related to operating leases during the six months ended March 31, 2025 and 2024 was approximately $0.2 million for both periods. The total cash paid related to operating leases is included in cash flows from operating activities on the accompanying condensed statements of cash flows. The weighted average discount rate of the Company’s operating leases is 8.97% and the weighted average the remaining lease term is 6.64 years.

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As of March 31, 2025, approximate future minimum lease payments on operating leases are as follows:

Six months ending September 30, 2025	$	185,000
Year ending September 30,
2026		287,000
2027		277,000
2028		285,000
2029		294,000
2030		303,000
Thereafter		443,000
Total future minimum lease obligation		2,074,000
Less imputed interest on operating lease obligation		(530,000	)
Net present value of operating lease obligations		1,544,000
Less net present value of operating lease obligations – current portion		(207,000	)
Net present value of operating lease obligations – non-current portion	$	1,337,000

G. PATENTS

During the six months ended March 31, 2025, the Company abandoned three patents which resulted in an impairment of $9,541 on patent costs. During the three months ended March 31, 2025, and the six and three months ended March 31, 2024, there was no impairment of patent costs. The weighted average amortization period for patents is approximately 7 years. For the six months ended March 31, 2025 and 2024, amortization of patent costs totaled approximately $15,000 and $17,000, respectively. For the three months ended March 31, 2025 and 2024, amortization of patent costs totaled approximately $7,000 and $8,000, respectively. The total estimated future amortization is as follows:

Six months ending September 30, 2025	$	14,000
Year ending September 30,
2026		25,000
2027		22,000
2028		18,000
2029		16,000
2030		14,000
Thereafter		32,000
Total	$	141,000

H. LOSS PER COMMON SHARE

Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed using the treasury stock method. The Company’s potentially dilutive shares, which include outstanding common stock options, common stock warrants, unvested common stock and unvested restricted stock are not included in the computation of diluted net loss per share if their effect would be anti-dilutive.

The calculation of basic and diluted net loss per share includes 14,587,500 of the pre-funded warrants that remain outstanding as of March 31, 2025.

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The following table provides a reconciliation of the numerators and denominators of the basic and diluted loss per-share computations:

	Six Months						Three Months
	Ended March 31,						Ended March 31,
	2025			2024			2025			2024
Loss per share – basic and diluted
Net loss available to common – basic and diluted	$	(13,645,451	)	$	(13,954,415	)	$	(6,572,389	)	$	(7,244,891	)
Weighted average shares outstanding – basic and diluted		74,827,420			50,228,860			84,540,132			52,006,442
Basic and diluted loss per common share	$	(0.18	)	$	(0.28	)	$	(0.08	)	$	(0.14	)

In accordance with the contingently issuable shares guidance of ASC 260, Earnings Per Share, the calculation of diluted net loss per share excludes the following securities because their inclusion would have been anti-dilutive as of March 31:

	2025		2024
Options and Warrants		17,826,344		15,772,993
Unvested Restricted Stock		144,250		147,250
Total		17,970,594		15,920,243

I. SUBSEQUENT EVENTS

On May 8, 2025, the Company received a loan in the amount of $350,000 with interest at the rate of 10% per annum from an unaffiliated party. The loan will be repaid from either potential partnering proceeds or a financing.

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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Company Overview

CEL-SCI Corporation is a late clinical-stage biotechnology company dedicated to research and development directed at improving the treatment of cancer and other diseases by using the immune system, the body’s natural defense system. CEL-SCI is currently focused on the development of the following product candidates and technologies:

	1)	Multikine, an investigational immunotherapy under development for the potential treatment of certain head and neck cancers; and

	2)	L.E.A.P.S. (Ligand Epitope Antigen Presentation System) technology, or LEAPS, with several product candidates under development for the potential treatment of rheumatoid arthritis.

Multikine (Leukocyte Interleukin, Injection) is the full name of this investigational therapy, which, for simplicity, is referred to in this report as Multikine. Multikine is the trademark that the Company has registered for this investigational therapy, and this proprietary name is subject to FDA review under the Company’s future anticipated regulatory submission for approval. None of the Company’s product candidates have been approved for sale, barter or exchange by the Food and Drug Administration (FDA) or any other regulatory agency for any use to treat disease in humans nor has the safety or efficacy of these products been established for any use. There can be no assurance that obtaining marketing approval from the FDA in the United States and by comparable agencies in most foreign countries will be granted.

MULTIKINE, THE PHASE III CLINICAL TRIAL RESULTS, AND PATH FORWARD

Immunotherapy is a large, high growth market. Immunotherapies use the patient’s own immune system to fight disease. These “targeted therapies” are at the forefront of modern cancer research. A Bloomberg report from January 2023 asserted that:

The global cancer immunotherapy market is expected to reach USD $196.45 billion by 2030, registering CAGR of 7.2% during the forecast period, according to a new report by Grand View Research, Inc. The rising adoption of immunotherapy over other therapy options for cancer owing to its targeted action is anticipated to increase the adoption during the forecast period. Moreover, increasing regulatory approvals from authoritarian establishments for novel immunotherapy used for oncology is also expected to further fuel the market growth. (https://www.bloomberg.com/press-releases/2023-01-18/cancer-immunotherapy-market-worth-196-45-billion-by-2030-grand-view-research-inc)

CEL-SCI hopes to participate in this growing market with its lead investigational therapy Multikine® (Leukocyte Interleukin, Injection). Multikine is unique among approved cancer immunotherapies because it is given first, right after diagnosis, before any other treatment including surgery.

Multikine has been tested in approximately 740 patients in Phase 1, 2 and 3 clinical studies conducted in the U.S., Canada, Europe, Israel and Asia. In these studies, it has been administered in multiple doses by various routes and various frequencies to determine its safety and efficacy. The data from these studies allowed CEL-SCI to determine the patient population most responsive to Multikine and most likely to benefit from it. The target population is newly diagnosed advanced primary head and neck cancer patients with no lymph node involvement (determined via PET imaging) and with low PD-L1 tumor expression (determined via biopsy), two features that physicians routinely assess at baseline as part of standard practice.

CEL-SCI completed a bias analysis for the target population in the Phase III study in preparation for submission of data to regulatory agencies including the FDA for confirmatory registration study. The detailed data on parameters including patient age, sex, race, tumor locations, and staging demonstrate balance between the treatment and control arms. Therefore, no bias was found, which supports confidence in Multikine’s efficacy results.

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In the target patient population CEL-SCI believes Multikine significantly extended life. In the Phase III study, CEL-SCI observed a 73% survival rate with Multikine vs. only 45% without Multikine at 5 years after treatment, and a Hazard ratio of 0.35 (95% CIs [0.19, 0.66]).

CEL-SCI applied to the FDA for a 212-patient randomized controlled confirmatory registration study focusing only on those patients in the target population, which accounts for approximately 100,000 patients worldwide per year. In May 2024, CEL-SCI announced that the FDA indicated CEL-SCI may move forward with a confirmatory registration study of Multikine in the target population.

What is Multikine and who is it for? Multikine is a biological medicinal immunotherapy comprised of a mixture of natural cytokines and small biological molecules. Multikine is injected around the tumor and adjacent lymph nodes for three weeks as a first-line treatment before the standard of care (SOC), which is surgery followed by either radiotherapy or chemoradiotherapy. Multikine’s rationale for use is to incite a locoregional immune response against the tumor before the local immune system has been compromised by the standard of care and/or disease progression.

The Multikine target population is not yet treated adult patients with resectable locally advanced primary squamous cell carcinoma of the head and neck (SCCHN) in the oral cavity and who have:

	·	No lymph node involvement (via PET imaging)
	·	Low PD-L1 tumor expression (TPS<10) (via biopsy)

PD-L1 is a protein receptor on the tumor surface that helps the tumor repel cells of the immune system. CEL-SCI believes that patients with tumors having low PD-L1 would be more likely to respond to Multikine because their tumors have lower defenses against the patient’s immune system. CEL-SCI estimates that patients with tumors having low PD-L1 represent about 70% of locally advanced primary SCCHN patients.

Targeting low PD-L1 also differentiates Multikine from other immunotherapies. For example, checkpoint inhibitors like Keytruda and Opdivo appear to best serve patients having high PD-L1, because these drugs work by blocking PD1/PD-L1 receptors interaction; when this interaction (PD1/PD-L1) happens it leads to inactivation/death of the immune cells attacking the tumor. These checkpoint inhibitors appear to act best when tumors express high levels of PD-L1 receptors (usually TPS >20 to TPS >50). While none of these drugs are currently approved as a first-line treatment before surgery, even if such approvals were to come in the future, CEL-SCI believes the large majority of patients having low PD-L1 would still be expected to need Multikine.

CEL-SCI believes Multikine leads to longer survival with no safety issues. Clinical investigations of Multikine, presented at ESMO (Europe Society for Medical Oncology) in October 2023, have demonstrated in the randomized controlled Phase III trial (RCT) the following in the target population:

	·	*risk of death cut in half at five years* versus the control;
	·	28.6% absolute 5-year overall survival benefit versus control (p=0.0015);
	·	0.349 hazard ratio vs control (95% CIs [0.18, 0.66], Wald p=0.0012);
	·	>35% rate of pre-surgery reductions and/or downstages (p<0.01); and
	·	low PD-L1 tumor expression (vs high PD-L1 where Keytruda and Opdivo work best).

There were no demonstrable safety signals or toxicities observed in approximately 740 Multikine-treated subjects across multiple clinical trials. Adverse event (AE) and serious adverse event (SAE) incidences were not significantly different among treatment and control groups. There were no Multikine-related deaths, no Multikine-related delays of surgery, no Multikine-related interference with post-surgical treatment, and only two discontinuations. Multikine-related AEs before surgery were local and resolved after surgery. Although the literature reports that some of Multikine’s components may be toxic when administered systemically (e.g., TNFα, IFN γ, IL-1β), these toxicities did not emerge with Multikine, even at doses many times higher than those administered in the Phase III trial, primarily due to Multikine’s delivery by local injection and dosage.

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CEL-SCI published its data as abstracts and posters at the annual conferences for the 2022 American Society of Clinical Oncology (ASCO), 2022 and 2023 European Society for Medical Oncology (ESMO), the 2023 European Head and Neck Society’s (EHNS’s) annual European Conference on Head and Neck Oncology (ECHNO), the 2023 European Society for Therapeutic Radiology and Oncology (ESTRO) and the 2023 American Head and Neck Society (AHNS). These publications can be accessed at http://www.cel-sci.com.

Multikine works by inducing pre-surgical responses. CEL-SCI observed statistically significant pre-surgical responses after Multikine treatment, and therefore CEL-SCI believes in the following:

	➢	Multikine causes pre-surgical responses;
	➢	Pre-surgical responses lead to longer life;
	➢	Therefore, selecting more patients predicted to have a pre-surgical response should lead to much better survival in the target population.

A “pre-surgical response” is a significant change in disease before surgery. CEL-SCI saw two kinds of responses in the Phase III trial. First, there were “reductions” in the size of the tumor—a reduction of 30% or more qualified as a “pre-surgical reduction,” or “PSR” for short. Second, there were disease “downstages” (e.g., the disease improved from Stage IV to Stage III) pre-surgery. CEL-SCI calls this a “pre-surgical downstaging” or “PSD” for short. CEL-SCI’s 2022 ESMO cancer conference presentation reported on PSR, and CEL-SCI’s new 2023 ESMO presentation reported on PSD.

Across the whole Phase III trial, PSRs were seen in 8.5% of Multikine patients compared to none in the control group. PSDs were seen in 22% of Multikine patients as compared to 13% in the control group. Because Multikine was the only therapy given to these patients before surgery, it is CEL-SCI’s strong belief that Multikine had to be the cause of the higher rates of PSR and PSD. These data are presented visually below. The taller blue columns show PSR and PSD rates in all 529 Multikine-treated patients in the Phase III trial, and the gray columns show PSR and PSD rates for all 394 control patients.

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It was not enough for CEL-SCI to show that Multikine likely leads to PSRs and PSDs as compared to a control group, CEL-SCI also had to test if PSRs and PSDs lead to improved survival. CEL-SCI’s Phase III trial demonstrated that PSR patients were 72% likely to be alive after five years, whereas control patients were only about 49% likely to be alive after five years. Patients with PSD saw similar improvement in CEL-SCI’s Phase III trial. Their five-year chance of survival was approximately 68%. Therefore, CEL-SCI believes that the Phase III trial demonstrated that those patients who had PSR or PSD resulting from Multikine lived longer than those who were not treated with Multikine. It is important to note that these results are from the entire Phase III study population, not from a subgroup. The likelihood of living at least five years is shown in the graphic below for patients with PSR (blue), patients with PSD (orange) and control patients who did not receive Multikine (gray).

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Multikine cut the 5-year risk of death in half in the target population. CEL-SCI’s results show that Multikine can cut the risk of death in half at five years versus the control group in the target population. Survival increased from 45% in the control group to 73% in the Multikine group at five years. This means the risk of death fell to 27% in the Multikine group from 55% in the control, shown below.

Another way to see the survival benefit of Multikine in the target population is the Kaplan-Meier curve from our ESMO ’23 poster, shown below. On the vertical axis is the probability of survival and the horizontal axis is time in months. The blue Multikine line is far above the green control line, meaning the chance of survival is much higher in the Multikine group at every point in time compared to the control. These results had a low (log rank) p-value of 0.0015, which is very significant as a statistical matter.

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CEL-SCI’s physician consultants tell CEL-SCI that the early separation of these two survival curves (e.g., at 12 months) adds validation to the potential positive effects of Multikine.

Another measure of survival benefit is called the “hazard ratio,” which compares the rate of an event (chances) of dying between two different groups. Here, in the Multikine target population, the hazard ratio was 0.35, which means that deaths occurred in the Multikine group about one-third as frequently as in the control group. It is also important to note that the hazard ratio’s 95% confidence interval remained far below 1.0 (which would mean parity between the compared groups). In the case of Multikine, statistically speaking, there is a 95% chance that the hazard ratio would fall between 0.18 and 0.66 if Multikine were tested in the target population in another study. A hazard ratio of 0.66 as the “so called worst case scenario” (the upper limit of the 95% confidence interval – for the hazard ratio – in this case) is still below (better) than the hazard ratio required for most drug approvals.

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These positive survival outcomes—increased overall survival, reduced risk of death, widely separated Kaplan-Meier curves with early separation, low hazard ratio, low p-values, low confidence intervals—CEL-SCI believes were driven by high PSR/PSD rates in the target population, as shown in the graphic below:

CEL-SCI relies on all of these data together to support its plan to request accelerated/conditional approval in the new target population without waiting until the completion of another clinical trial. CEL-SCI’s regulatory strategy going forward is to seek approval of Multikine following full enrollment of its confirmatory study wherever possible.

	·	The confirmatory study will be a randomized controlled trial with two arms: Multikine treatment plus standard of care versus standard of care alone.

	·	If approved as a pre-surgical treatment, CEL-SCI believes Multikine should be added to the standard of care for the target population in this unmet medical need.

	·	CEL-SCI believes that the confirmatory study has a high likelihood of success based on the large survival benefit that has already been observed in the target population from the completed Phase III study. The planned confirmatory study will be much smaller—less than a quarter the size of the prior study— and will focus on the patients who saw the greatest survival benefit when treated with Multikine.

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Why Do We Believe Our Confirmatory Study Will Be Successful?

An “unmet need” is a factor for approval considered by all major regulatory bodies worldwide. In the Multikine target population, there is also a great unmet need for improved survival. The current standard of care provides only about a 50/50 chance of surviving five years, whereas Multikine could increase that survival rate to over 70% in the target population based on the Phase III data. Chemotherapy (in addition to radiotherapy following surgery) has improved survival outcome for some head and neck patients, but chemotherapy is only indicated for high-risk patients, who are not likely to fall within the Multikine target population. Currently available immunotherapies are given after surgery or where surgery is not indicated, in contrast to Multikine, which is given before surgery to patients with resectable tumors. Available checkpoint inhibitors work best on tumors with high PD-L1 expression, whereas Multikine works best in tumors with low PD-L1 expression. Therefore, Multikine’s target population is underserved, and will continue to be underserved, by current therapies.

The major regulatory bodies with whom we are working, U.S. FDA, Health Canada, European Medicines Agency (EMA) and the Medicines and Healthcare products Regulatory Agency (MHRA) in the United Kingdom (UK) all have conditional approval pathways designed for situations where the target population has not been fully tested prospectively and there is strong data supporting clinical benefit for patients. The reason is that regulators understand that in many cases patients should not have to wait for additional data before being offered the chance to benefit from a new drug, especially if the drug has been shown to be safe. Every situation is different and depends on the specific facts.

IN CONCLUSION

	·	Strong survival data: Multikine-treated patients in the target population had a 73% 5-year survival vs a 45% 5-year survival in the control group who did not receive Multikine in the Phase III study. In addition, no safety signals or toxicities versus standard of care. The Hazard ratio is 0.35 with an upper limit (95% Confidence Interval) of 0.66.

	·	Addressing an unmet medical need: Multikine focuses on the 70% of patients not well served by the two leading approved drugs for head and neck cancer, Keytruda and Opdivo. Multikine’s proposed indication is a pre-surgical treatment in head & neck cancer, where no drug is currently approved.

	·	Multikine’s Target Population: The confirmatory registration study will focus on newly diagnosed locally advanced primary head and neck cancer patients with no lymph node involvement (determined via PET scan) and with low PD-L1 tumor expression (determined via biopsy).

	·	FDA pathway: CEL-SCI’s goal is to begin the 212-patient confirmatory registration study as soon as the needed capital has been raised, with full enrollment about 15 months later with the potential to seek early approval after full enrollment.

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Liquidity and Capital Resources

Since inception, the Company has financed its operations through the issuance of equity securities, convertible notes, loans and certain research grants. The Company will likely continue to generate net operating losses as it continues the development of Multikine and brings other drug candidates into clinical trials. Until such time as the Company becomes profitable, any or all of these financing vehicles or others may be utilized to assist the Company’s capital requirements.

Capital raised by the Company has been expended primarily for patent applications, research and development, administrative costs, the construction and upgrade of the Company’s manufacturing and laboratory facilities and clinical trials. The Company does not anticipate realizing significant revenues until entering into licensing arrangements for its technology and know-how or until it receives regulatory approval to sell its products (which could take several years). Thus, the Company has been dependent upon the proceeds from the sale of its securities to meet all of the Company’s liquidity and capital requirements and anticipates having to do so in the future.

The cost of the confirmatory registration study is estimated to be about $30 million. The Company will be required to raise additional capital or find additional long-term financing to continue with its research efforts. The ability to raise capital may be dependent upon market conditions that are outside the control of the Company. The ability of the Company to complete the necessary clinical trials and obtain FDA approval for the sale of products to be developed on a commercial basis is uncertain. Ultimately, the Company must complete the development of its products, obtain the appropriate regulatory approvals and obtain sufficient revenues to support its cost structure. However, there can be no assurance that the Company will be able to raise sufficient capital to support its operations. Due to recurring losses from operations and future liquidity needs, there is substantial doubt about the Company’s ability to continue as a going concern.

During the six months ended March 31, 2025, the Company’s cash decreased by approximately $2.8 million. Significant components of this decrease included net proceeds from the December 2024 and March 2025 financings of $6.7 million offset by cash used to fund the Company’s regular operations of approximately $8.5 million and approximately $1.0 million in payments on their finance lease obligations.

During the six months ended March 31, 2024, the Company’s cash increased by approximately $1.2 million. The significant component of this increase included net proceeds from the November 2023 and February 2024 financing of $11.5 million offset by cash used to fund the Company’s regular operations of approximately $9.4 million and approximately $0.9 million in payments on their finance lease obligations.

During the six months ended March 31, 2025, 7,427,500 pre-funded warrants were exercised. No warrants were exercised during the six months ended March 31, 2024.

Results of Operations and Financial Condition

The Company incurred a net operating loss of approximately $13.3 million for the six months ended March 31, 2025. This net operating loss consists of significant non-cash expenses including approximately $1.9 million in share-based compensation to employees and non-employees, and approximately $2.0 million in depreciation and amortization expense. The Company incurred a net operating loss of approximately $13.6 million for the six months ended March 31, 2024. This net operating loss consists of significant non-cash expenses including approximately $3.2 million in share-based compensation to employees and non-employees, and approximately $2.0 million in depreciation and amortization expense.

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Research and Development Expenses

Research and development expenses consist primarily of costs incurred for our research activities, including our discovery efforts and the development of our products, and include:

	·	employee‑related expenses, including salaries, related benefits and stock‑based compensation expense for employees engaged in research and development functions;
	·	fees paid to consultants for services directly related to our product development and regulatory efforts;
	·	expenses incurred under agreements with Clinical Research Organizations, or CROs, and consultants that conduct and provide supplies for our clinical studies and clinical trials;
	·	costs associated with clinical activities and development activities; and
	·	costs related to compliance with regulatory requirements.

The following table summarizes our research and development expenses for the six months ended March 31, 2025 and 2024:

	Six Months Ended March 31,
(in thousands)	2025		2024
Clinical trial expense	$	471	$	340
Supplies & materials		1,011		763
Personnel-related expenses		3,078		2,981
Stock-based compensation		769		1,790
Depreciation and amortization expense		1,945		1,808
Other expenses		1,170		1,299
Total research and development expenses	$	8,444	$	8,981

During the six months ended March 31, 2025, research and development expenses decreased by approximately $0.5 million, or 6%, compared to the six months ended March 31, 2024. The major components of the decrease in research and development expenses over the prior period include an approximate $1.0 million of employee stock compensation expense due to the options issued in the prior period having a higher fair value because of the Company’s stock price, offset by an increase of $0.1 million in clinical studies costs, $0.2 million in costs incurred for supplies and materials used as a result of preparing the confirmatory study for enrollment and $0.2 million in other research and development costs.

During the three months ended March 31, 2025, research and development expenses decreased by approximately $0.6 million, or 13%, compared to the three months ended March 31, 2024. The major components of the decrease in research and development expenses over the prior period include an approximate $0.5 million of employee stock compensation expense due to the options issued in the prior period having a higher fair value because of the Company’s stock price, and $0.1 million in other research and development costs.

General and Administrative Expenses

During the six months ended March 31, 2025, general and administrative expenses increased by approximately $0.3 million, or 6%, compared to the six months ended March 31, 2024. The major components of the increase in general and administrative expenses over the prior period include an approximate $0.7 million in public relation costs and $0.2 million in accounting fees due to out of scope work, offset by a decrease of $0.4 million of employee stock compensation expense due to the options issued in the prior period having a higher fair value because of the Company’s stock price, and $0.2 million in other general and administrative expenses.

During the three months ended March 31, 2025 and 2024, there was no change in general and administrative expenses as it remained constant at approximately $2.4 million. The major components of general and administrative expenses include an approximate $0.4 million increase over the prior period in public relation costs primarily due to an increase in public relation efforts to attract more investors for the Company’s financings, offset by a decrease of $0.3 million of employee stock compensation expense due to the options issued in the prior period having a higher fair value because of the Company’s stock price, and a decrease of $0.1 million in other general and administrative expenses.

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Interest Expense, Net

During the six months ended March 31, 2025 and 2024, net interest expense remained constant at approximately $0.4 million, which is primarily due to the interest paid on the Company’s lease liabilities. During the three months ended March 31, 2025 and 2024, net interest expense remained constant at approximately $0.2 million, which is primarily due to the interest paid on the Company’s lease liabilities.

Research and Development Expenses

The Company’s research and development efforts involve Multikine and LEAPS. The table below shows the research and development expenses associated with each project.

	Six Months Ended				Three Months Ended
	March 31,				March 31,
	2025		2024		2025		2024
MULTIKINE	$	8,403,569	$	8,934,795	$	3,994,104	$	4,605,543
LEAPS		40,759		46,249		20,161		22,992
TOTAL	$	8,444,328	$	8,981,044	$	4,014,265	$	4,628,535

Clinical and other studies necessary to obtain regulatory approval of a new drug involve significant costs and require several years to complete. The extent of the Company’s clinical trials and research programs are primarily based upon the amount of capital available to the Company and the extent to which the Company has received regulatory approvals for clinical trials. The inability of the Company to conduct clinical trials or research, whether due to a lack of capital or regulatory approval, will prevent the Company from completing the studies and research required to obtain regulatory approval for any products which the Company is developing. Without regulatory approval, the Company will be unable to sell any of its products. Since all of the Company’s projects are under development, the Company cannot predict when it will be able to generate any revenue from the sale of any of its products.

Critical Accounting Estimates

CEL-SCI's significant accounting estimates are more fully described in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended September 30, 2024. However, certain accounting estimates are particularly important to the portrayal of CEL-SCI’s financial position and results of operations and require the application of significant judgments by management. As a result, the financial statements are subject to an inherent degree of uncertainty. In applying those estimates, management uses its judgment to determine the appropriate assumptions to be used in the determination of certain estimates. These estimates are based on CEL-SCI's historical experience, terms of existing contracts, observance of trends in the industry and information available from outside sources, as appropriate.

Management believes that the following critical accounting estimates require the most significant judgments and estimates with respect to the preparation of CEL-SCI’s financial statements.

Lease Accounting – The measurement of the finance and operating lease right-of-use asset and lease liabilities requires the determination of an estimated lease term and an incremental borrowing rate. The determination of the incremental borrowing rates for new and modified lease contracts is a critical accounting estimate. Significant judgment is required by management to develop inputs and assumptions used to determine the incremental borrowing rate for lease contracts.

Share-based Compensation – Compensation cost for all share-based awards is measured at fair value as of the grant date in accordance with the provisions of ASC 718, Compensation – Stock Compensation (“ASC 718”). The fair value of stock options is calculated using the Black-Scholes option pricing model. The Black-Scholes model requires five input variables: the strike price of an option, the current stock price, the time to expiration, the risk-free rate and the volatility. The share-based compensation cost is recognized using the straight-line method as expense over the requisite service or vesting period.

CEL-SCI has Incentive Stock Option Plans, Non-Qualified Stock Option Plans, Stock Compensation Plans, Stock Bonus Plans and an Incentive Stock Bonus Plan. These Plans are collectively referred to as the “Plans”. All Plans have been approved by CEL-SCI’s stockholders.

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CEL-SCI’s stock options are not transferable, and the actual value of the stock options that an employee may realize, if any, will depend on the excess of the market price on the date of exercise over the exercise price. For options issued with service conditions only, CEL-SCI has based its assumption for stock price volatility on the variance of daily closing prices of CEL-SCI’s stock. The risk-free interest rate assumption is based on the U.S. Treasury rate at the date of grant with the term equal to the expected life of the option. Forfeitures are accounted for when they occur. The expected term of options represents the period that options granted are expected to be outstanding and has been determined based on an analysis of historical exercise behavior. If any of the assumptions used in the Black-Scholes model change significantly, share-based compensation expense for new awards may differ materially in the future from that recorded in the current period.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

The Company does not believe that it has any significant exposure to market risk.

Item 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Under the direction and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial and Operations Officer, the Company carried out an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures as of March 31, 2025. The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its periodic reports with the Securities and Exchange Commission is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and regulations, and that such information is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Company’s disclosure controls and procedures are designed to provide a reasonable level of assurance of reaching its desired disclosure control objectives.

The Company’s Chief Executive Officer and Chief Financial and Operations Officer has concluded that the Company’s disclosure controls and procedures were not effective as of March 31, 2025 due to the material weaknesses described in the Company's Annual Report on Form 10-K for the year ended September 30, 2024.

Changes in Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting that occurred during the six months ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

During the six months ended March 31, 2025, the Company issued 204,615 restricted shares of common stock to consultants for investor relations services.

The Company relied upon the exemption provided by Section 4(a)(2) of the Securities Act of 1933 with respect to the issuance of these shares. The individuals who acquired these shares were sophisticated investors and were provided full information regarding the Company’s business and operations. There was no general solicitation in connection with the offer or sale of these securities. The individuals who acquired these shares acquired them for their own accounts. The certificates representing these shares bear a restricted legend which provides they cannot be sold except pursuant to an effective registration statement or an exemption from registration. No commission or other form of remuneration was given to any person in connection with the issuance of these shares.

Item 5. Other Information

None of our directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the quarterly period ending March 31, 2025.

Item 6. Exhibits

Number		Exhibit

31		Rule 13a-14(a) Certifications

32		Section 1350 Certifications

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	CEL-SCI CORPORATION

Date: May 14, 2025	By:	/s/ Geert Kersten
		Geert Kersten
		Principal Executive Officer

		/s/ Patricia Prichep
		Patricia Prichep
		Principal Financial Officer

SEC Form 10-Q filed by Cel-Sci Corporation