UNITED
STATES

 SECURITIES
AND EXCHANGE COMMISSION

 Washington,
D.C. 20549

 FORM

 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For
the Fiscal Year Ended September 30, 2023

 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 Commission
File Number 001-38174

Pharmaceuticals, Inc.

 (Exact
name of Registrant as specified in its Charter)

 Nevada

 27-3425913

 (State or other jurisdiction of
 incorporation or organization)

 (I.R.S. Employer
 Identification No.)

Commerce Drive, First Floor, Cranford, NJ 07016

 (Address
of principal executive offices) (Zip Code)

 (908) 967-6677

 (Registrant's
telephone number, including area code)

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

 Title of Each Class

 Trading Symbol(s)

 Name of Each Exchange on Which Registered

 Common Stock, par value $0.001 per share

 CTXR

 The NASDAQ Capital Market

by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No

by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes No

by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the 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) has been subject
to such filing requirements for the past 90 days. Yes No

by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
 Yes No

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.

by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act by the registered public accounting firm
that prepared or issued its audit report.

 If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.

by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).

by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

 The
aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which
the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's
most recently completed second fiscal quarter (March 31, 2023) was approximately $ 156.9 million.

 Affiliates
for the purpose of this item refers to the issuer's executive officers and directors and/or any persons or firms (excluding those
brokerage firms and/or clearing houses and/or depository companies holding issuer's securities as record holders only for their
respective clients' beneficial interest) owning 10% or more of the issuer's common stock, both of record and beneficially.

the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date:

 158,966,576
shares as of December 27, 2023, all of one class of common stock, $0.001 par value.

 DOCUMENTS
INCORPORATED BY REFERENCE

 Portions
of the Company's Proxy Statement for the Annual Meeting of Stockholders expected to be held in March 2024 are incorporated
by reference in Part III of this Report.

Pharmaceuticals, Inc.

 FORM

 September
30, 2023

 TABLE
OF CONTENTS

 Page

 PART
 I

 Item 1.

 Business

 Item 1A.

 Risk
 Factors

 Item 1B.

 Unresolved
 Staff Comments

 Item 1C.

 Cybersecurity

 Item 2.

 Properties

 Item 3.

 Legal
 Proceedings

 Item 4.

 Mine
 Safety Disclosures

 PART
 II

 Item 5.

 for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 Item 6.

 [Reserved]

 Item 7.

 Management's
 Discussion and Analysis of Financial Condition and Results of Operations

 Item 7A.

 Quantitative
 and Qualitative Disclosures About Market Risk

 Item 8.

 Financial
 Statements and Supplementary Data

 F-1 to F-20

 Item 9.

 Changes
 in and Disagreements With Accountants on Accounting and Financial Disclosure

 Item 9A.

 Controls
 and Procedures

 Item 9B.

 Other
 Information

 Item 9C.

 Disclosure
 Regarding Foreign Jurisdictions that Prevent Inspections

 PART
 III

 Item 10.

 Directors,
 Executive Officers and Corporate Governance

 Item 11.

 Executive
 Compensation

 Item 12.

 Security
 Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 Item 13.

 Certain
 Relationships and Related Transactions, and Director Independence

 Item 14.

 Principal
 Accountant Fees and Services

 PART
 IV

 Item 15.

 Exhibits
 and Financial Statement Schedules

 Item 16.

 Form
 10-K Summary

 Signatures

 i

 NOTES

 In
this annual report on Form 10-K, and unless the context otherwise requires, the "Company," "we," "us"
and "our" refer to Citius Pharmaceuticals, Inc. and its wholly-owned subsidiaries Citius Pharmaceuticals, LLC, Leonard-Meron
Biosciences, Inc. and Citius Oncology, Inc. (formerly Citius Acquisition Corp.), and its majority-owned subsidiary, NoveCite, Inc.,
taken as a whole.

and LYMPHIR TM (denileukin diftitox) are our registered trademarks. All other trade names, trademarks and service marks
appearing in this prospectus are the property of their respective owners. We have assumed that the reader understands that all such terms
are source-indicating. Accordingly, such terms, when first mentioned in this report, appear with the trade name, trademark or service
mark notice and then throughout the remainder of this report without trade name, trademark or service mark notices for convenience only
and should not be construed as being used in a descriptive or generic sense.

 FORWARD-LOOKING
STATEMENTS

 This
Annual Report on Form 10-K contains "forward-looking statements." Forward-looking statements include, but are not limited
to, statements that express our intentions, beliefs, expectations, plans, strategies, predictions, or any other statements relating to
our future activities or other future events or conditions. These statements are based on current expectations, estimates and projections
about our business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve
risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may, and are likely to, differ
materially from what is expressed or forecasted in the forward-looking statements due to numerous factors discussed from time to time
in this report, including the risks described under Item 1A - "Risk Factors," and Item 7 - "Management's Discussion
and Analysis of Financial Condition and Results of Operations" in this report and in other documents which we file with the Securities
and Exchange Commission ("SEC"). In addition, such statements could be affected by risks and uncertainties related to:

 the
 cost, timing, and results of our pre-clinical and clinical trials;

 our
 ability to raise funds for general corporate purposes and operations, including our pre-clinical
 and clinical trials;

 our
 ability to apply for, obtain and maintain required regulatory approvals for our product candidates;

 the commercial feasibility
 and success of our technology and our product candidates;

 our ability to recruit
 qualified management and technical personnel to carry out our operations;

 our ability to realize
 some or all of the benefits expected to result from the anticipated spinoff of Citius Oncology, Inc., or the delay of such benefits;

 our ongoing businesses
 may be adversely affected and subject to certain risks and consequences as a result of the anticipated spinoff transaction; and

 the other factors discussed
 in the "Risk Factors" section and elsewhere in this report.

 Any
forward-looking statements speak only as of the date on which they are made, and, except as may be required under applicable securities
laws, we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the filing
date of this report.

 ii

 SUMMARY
OF RISK FACTORS

 An
investment in our securities involves a high degree of risk. You should carefully consider the risks summarized in Item 1A, "Risk
Factors" included in this report. These risks include, but are not limited to, the following:

 We
 have a history of net losses and expect to incur losses for the foreseeable future. We may
 never generate revenues or, if we are able to generate revenues, achieve profitability.

 Our
 independent registered public accounting firm's report includes an explanatory paragraph
 stating that there is substantial doubt about our ability to continue as a going concern.

 While
 we believe we have sufficient funds on hand to complete the regulatory development and commercially
 launch LYMPHIR, delays in our anticipated submission of the BLA for LYMPHIR, issues raised
 by the FDA after resubmission or other factors could increase the cost to develop and launch
 LYMPHIR, which we expect would require us to obtain additional capital to complete those
 efforts.

 We
 need to secure additional financing in the near future to complete the development of our
 other current product candidates and support our operations.

 We
 are primarily a late-stage development company with an unproven business strategy and may
 never achieve commercialization of our therapeutic product candidates or profitability.

 We
 have a limited operating history upon which to evaluate our ability to successfully commercialize
 our product candidates.

 We
 may choose not to continue developing any of our product candidates at any time during development,
 which would reduce or eliminate our potential return on investment for those product candidates.

 We
 face significant risks in our product candidate development efforts.

 We
 may be required to make milestone payments to the licensor and former licensee of the LYMPHIR
 intellectual property in connection with its development and commercialization of LYMPHIR,
 which could adversely affect the profitability of LYMPHIR, if approved.

 While
 our business strategy generally is to focus on the development of late-stage product candidates
 to lessen the development risk, there is still significant risk to successfully developing
 a product candidate.

 The
 results of pre-clinical studies and completed clinical trials are not necessarily predictive
 of future results, and our current product candidates may not have favorable results in later
 studies or trials.

 If
 we are unable to file for approval of Mino-Lok or Halo-Lido under Section 505(b)(2) of the
 Federal Food, Drug and Cosmetic Act, or if we are required to generate additional data related
 to safety and efficacy under Section 505(b)(2), we may be unable to meet our anticipated
 development and commercialization timelines.

 Because
 our NoveCite product candidate is based on novel mesenchymal stem cell technologies, it is
 difficult to predict the regulatory approval process and the time, the cost and our ability
 to successfully initiate, conduct and complete clinical development, and obtain the necessary
 regulatory and reimbursement approvals, required for commercialization of our NoveCite product
 candidate.

 has assumed that the biological capabilities of iPSCs and adult-donor derived cells are likely
 to be comparable. If it is discovered that this assumption is incorrect, the NoveCite product
 candidate research and development activities could be harmed.

 Even
 if we receive regulatory approval to commercialize a product candidate, that product may
 not gain market acceptance among physicians, patients, healthcare payers or the medical community
 and may not generate significant revenue.

 Even
 if approved for marketing by applicable regulatory bodies, we will not be able to create
 a market for any of our product candidates if we fail to establish marketing, sales, and
 distribution capabilities, either on our own or through arrangements with third parties.

 iii

 The
 markets in which we operate are highly competitive and we may be unable to compete successfully
 against new entrants or established companies.

 Our
 ability to generate product revenues will be diminished if any of our product candidates
 that may be approved sell for inadequate prices or patients are unable to obtain adequate
 levels of reimbursement.

 We
 are and will be dependent on third-party CROs to conduct all of our clinical trials.

 We
 rely exclusively on third parties to formulate and manufacture our product candidates.

 Any
 termination, or breach by, or conflict with our strategic partners could harm our business.

 We
 rely on the significant experience and specialized expertise of our executive management
 and other key personnel and the loss of any of our executive management or key personnel
 or our inability to successfully hire their successors could harm our business.

 We
 expect to need to increase the size of our organization to further develop our product candidates,
 and we may experience difficulties in managing growth.

 We
 plan to grow and develop our business through acquisitions of or investment in new or complementary
 businesses, products or technologies, and the failure to manage these acquisitions or investments,
 or the failure to integrate them with our existing business, could have a material adverse
 effect on us.

 We
 might not obtain the necessary U.S. or foreign regulatory approvals to commercialize any
 product candidates.

 Following
 any regulatory approval of any product candidate, we will be subject to ongoing regulatory
 obligations and restrictions, which may result in significant expense and limit our ability
 to commercialize our other product candidates.

 We
 could be forced to pay substantial damage awards if product liability claims that may be
 brought against us are successful.

 Our
 business depends on protecting our intellectual property.

 The
 anticipated spinoff of our LYMPHIR asset is dependent on market conditions, customary closing
 conditions, and other factors out of our control. Consequently, there can be no assurance
 regarding the ultimate timing of the proposed transaction or that the transaction will be
 completed at all.

 We
 may be unable to achieve some or all of the benefits that we expect to achieve from the spinoff.

 Even
 after the completion of the Business Combination, the Combined Company will require substantial
 additional funding, which may not be available on acceptable terms, or at all.

 We
 share some directors, officers, and research staff with NoveCite and Citius Oncology. The
 dual roles of our employees, officers and directors who also serve in similar roles with
 NoveCite and/or Citius Oncology could create a conflict of interest, which could expose us
 to claims by our investors and creditors and could harm our results of operations.

 A
 distribution in connection with or following the spinoff could result in substantial tax
 liability to us and our stockholders.

 Our
 failure to maintain compliance with Nasdaq's continued listing requirements could result
 in the delisting of our common stock.

 You
 may experience dilution of your ownership interests because of the future issuance of additional
 shares of our common stock or securities convertible into common stock.

 Under
 our Certificate of Incorporation, our Board of Directors has the authority to issue up to
 10,000,000 shares of preferred stock and to fix and determine the relative rights and preferences
 of any such preferred stock without further stockholder approval. As a result, our Board
 of Directors could authorize the issuance of one or more series of preferred stock that would
 grant preferential rights over our common stock.

 We
 have not paid cash dividends in the past and we do not expect to pay cash dividends in the
 foreseeable future. Any return on investment may be limited to the capital appreciation,
 if any, of our common stock.

 Provisions
 in our Amended and Restated Articles of Incorporation, as amended, and under Nevada law could
 discourage a takeover that stockholders may consider favorable and may lead to entrenchment
 of management.

 iv

 PART
I

 Item
1. Business

Pharmaceuticals, Inc. ("Citius Pharma", and together with its subsidiaries, the "Company" or "we"),
headquartered in Cranford, New Jersey, is a late-stage pharmaceutical company dedicated to the development and commercialization of first-in-class
critical care products with a focus on oncology, anti-infectives in adjunct cancer care, unique prescription products and stem cell therapy.
Our goal generally is to achieve leading market positions by providing therapeutic products that address unmet medical needs yet have
a lower development risk than usually is associated with new chemical entities. New formulations of previously approved drugs with substantial
existing safety and efficacy data are a core focus. We seek to reduce development and clinical risks associated with drug development,
yet still focus on innovative applications. Our strategy centers on products that have intellectual property and regulatory exclusivity
protection, while providing competitive advantages over other existing therapeutic approaches.

 The
Company was founded as Citius Pharmaceuticals, LLC, a Massachusetts limited liability company, on January 23, 2007. On September 12,
2014, Citius Pharmaceuticals, LLC entered into a Share Exchange and Reorganization Agreement, with Citius Pharma (formerly Trail One,
Inc.), a publicly traded company incorporated under the laws of the State of Nevada. Citius Pharmaceuticals, LLC became a wholly-owned
subsidiary of Citius Pharma. On March 30, 2016, Citius Pharma acquired Leonard-Meron Biosciences, Inc. ("LMB") as a wholly-owned
subsidiary. LMB was a pharmaceutical company focused on the development and commercialization of critical care products with a concentration
on anti-infectives. On September 11, 2020, we formed NoveCite, Inc. ("NoveCite"), a Delaware corporation, of which we own
75% of the issued and outstanding capital stock. NoveCite is focused on the development and commercialization of its proprietary mesenchymal
stem cells for the treatment of acute respiratory disease syndrome ("ARDS").

 On
August 23, 2021, we formed Citius Oncology, Inc. (formerly Citius Acquisition Corp.) ("Citius Oncology") as a wholly-owned
subsidiary in conjunction with the acquisition of LYMPHIR TM, but Citius Oncology did not begin operations until April 2022,
when Citius Pharma transferred the assets related to LYMPHIR to Citius Oncology, including the related license agreement with Eisai Co.,
Ltd. ("Eisai") and the related asset purchase agreement with Dr. Reddy's Laboratories SA, a subsidiary of Dr. Reddy's
Laboratories, Ltd. (collectively, "Dr. Reddy's"). Since its inception, Citius Pharma has funded Citius Oncology, and
Citius Pharma and Citius Oncology are party to a shared services agreement, which governs certain management and scientific services
that Citius Pharma provides Citius Oncology.

 Since
its inception, the Company has devoted substantially all of its efforts to business planning, acquiring our proprietary technology, research
and development, recruiting management and technical staff, and raising capital. We are developing five proprietary products: LYMPHIR,
in-licensed in September 2021 (now owned by Citius Oncology), an engineered IL-2 diphtheria toxin fusion protein, for the treatment of
patients with persistent or recurrent cutaneous T-cell lymphoma ("CTCL"); Mino-Lok, an antibiotic lock solution used to treat
patients with catheter-related bloodstream infections by salvaging the infected catheter; Halo-Lido, a corticosteroid-lidocaine topical
formulation that is intended to provide anti-inflammatory and anesthetic relief to persons suffering from hemorrhoids; Mino-Wrap, a liquifying
gel-based wrap for reduction of tissue expander infections following breast reconstructive surgeries; and NoveCite, a mesenchymal stem
cell therapy for the treatment of ARDS. We believe these unique markets for our products are large, growing, and underserved by the current
prescription products or procedures.

 We
are subject to a number of risks common to companies in the pharmaceutical industry including, but not limited to, risks related to the
development by us or our competitors of research and development stage products, market acceptance of its products that receive regulatory
approval, competition from larger companies, dependence on key personnel, dependence on key suppliers and strategic partners, the Company's
ability to obtain additional financing and the Company's compliance with governmental and other regulations.

 Recent
Developments

 As
previously disclosed, on October 23, 2023, Citius Pharma and Citius Oncology entered into an agreement and plan of merger and reorganization
(the "Merger Agreement") with TenX Keane Acquisition, a Cayman Islands exempted company ("TenX"), and TenX Merger
Sub Inc., a Delaware corporation and a wholly owned subsidiary of TenX ("Merger Sub"). The Merger Agreement provides, among
other things, (i) on the terms and subject to the conditions set forth therein, that Merger Sub will merge with and into Citius Oncology,
with Citius Oncology to be renamed and to survive as a wholly owned subsidiary of TenX (the "Merger"), and (ii) that prior
to the effective time of the Merger (the "Effective Time"), TenX will migrate to and domesticate as a Delaware corporation
in accordance with Section 388 of the General Corporation Law of the State of Delaware and the Cayman Islands Companies Act (As Revised)
(the "Domestication"). The newly combined publicly traded company is to be named "Citius Oncology, Inc." (the
"Combined Company"). The Domestication, Merger and the other transactions contemplated by the Merger Agreement are referred
to herein as the "Business Combination".

 In
the Merger, all shares of Citius Oncology would be converted into the right to receive common stock of the Combined Company. As a result,
upon closing, Citius Pharma would receive 67.5 million shares of common stock of the Combined Company which, at an implied value of $10.00
per share, would be $675 million in equity of the Combined Company, before fees and expenses. As part of the transaction, Citius Pharma
will contribute $10 million in cash to the Combined Company. An additional 12.6 million existing options will be assumed by the Combined
Company. Citius Pharma and the Combined Company will also enter into an amended and restated shared services agreement, which, among
other things, will govern certain management and scientific services that Citius Pharma will continue to provide to the Combined Company
following the Effective Time.

 The
Merger Agreement, Business Combination and the transactions contemplated thereby were unanimously approved by the boards of directors
of each of Citius Pharma, Citius Oncology and TenX. The transaction is expected to be completed in the first half of 2024, subject to
approval by stockholders of TenX and other customary closing conditions, including final regulatory approvals and SEC filings. There
can be no assurance regarding the ultimate timing of the proposed transaction or that the transaction will be completed at all.

 LYMPHIR TM (denileukin
diftitox-cdxl)

 In
September 2021, the Company announced that it had entered into an asset purchase agreement with Dr. Reddy's to acquire its exclusive
license of E7777 (denileukin diftitox), a late-stage oncology immunotherapy for the treatment of CTCL, a rare form of non-Hodgkin lymphoma.
Dr. Reddy's had previously licensed E777 to Eisai and as part of the transaction, Eisai entered into a license agreement whereby
Eisai assigned all of its rights to E7777 to Citius Pharma. In April 2022, Citius Pharma transferred the assets related to E7777 to Citius
Oncology, including the related license agreement with Eisai and the related asset purchase agreement with Dr. Reddy's. Renamed
LYMPHIR, E7777 is an improved formulation of ONTAK, which was previously approved by the United States Food and Drug Administration
("FDA") marketed for the treatment of patients with persistent or recurrent CTCL. At times in this annual report on Form
10-K, LYMPHIR may be referred as E7777.

is recombinant DNA-derived fusion protein designed to direct the cytocidal action of diphtheria toxin (DT) to cells which express the
IL-2 receptor. After uptake into the cell, the DT fragment is cleaved and the free DT fragments inhibit protein synthesis, resulting
in cell death. Consequently, LYMPHIR's differentiated mechanism of action supports two therapeutic effects: (i) killing tumors
by binding to IL-2 receptors to deliver diphtheria toxin directly to the tumor cells, and (ii) depleting immunosuppressive regulatory
T lymphocytes (Tregs) to enhance antitumor activity.

 Phase
3 Trial (E7777-G000-302) Design

 In
2013, a global, multicenter, open label single arm pivotal clinical trial for the treatment of patients with persistent or recurrent
CTCL was initiated. Inclusion criteria for the study were to evaluate patients in advanced stage CTCL (Mycosis Fungoides or S zary
Syndrome), who received at least one prior CTCL therapy.

 The
pivotal trial was divided into two phases, a lead-in phase with 21 subjects that evaluated dose finding, pharmacokinetics and immunogenicity,
and assessed the Objective Response Rate (the "ORR"). An ORR is defined as a greater than 50% reduction in tumor burden.
Patients received a daily intravenous infusion of denileukin diftitox from Day 1 through Day 5 of each 21-day cycle.

 Based
on safety, tolerability, and efficacy data of the lead-in phase, 9 mcg/kg/dose was selected for the main phase of the study. No new safety
signals were identified compared to ONTAK. In addition, an ORR of 38.1% in the intent to treat population and 44.4% in the efficacy evaluable
populations were observed. In the second and main phase of the pivotal trial, 70 patients were administered the 9 mcg/kg/dose rate for
5 consecutive days in 21-day cycles. The inclusion criteria were identical to the lead-in study and the primary objective was to evaluate
the ORR.

 Phase
3 Trial Efficacy & Safety Results

 The
efficacy population of the main study includes 69 patients with relapsed or refractory stage I to III CTCL. Of the 69 patients, the median
age was 64 years (range: 28 to 87 years), 65% were male, 73% were White, 19% Black or African American, 1% Asian, and 14% Hispanic or
Latino. The CTCL disease stage was IA in 7%, IB in 23%, IIA in 13%, IIB in 35%, IIIA in 12%, and IIIB in 10%. The median number of prior
therapies was 4 (range: 1 to 18), including both skin-directed and systemic therapies. Prior therapies included photodynamic therapy
(56%), total skin electron beam therapy (42%), systemic retinoids (49%), methotrexate/pralatrexate (49%), histone deacetylase inhibitor
(35%), brentuximab vedotin (26%) and mogamulizumab (12%).

 Efficacy
was established based on ORR, according to ISCL/EORTC Global Response Score (GRS) per Independent Review Committee (Olsen 2011). Efficacy
results are shown in the table below.

 Efficacy
 Results of E7777-G000-302

 mcg/kg/day

 (N
 = 69)

 ORR (GRS)% a

 36%

 (95%
 CI b)

 (25,
 49)

 Complete Response

 9%

 Partial Response

 27%

 Duration of Response

 Median
 (range), months

 6.5
 (3.0 +, 23.5 +)

 Duration
 6 months, n (%)

 52%

 Median Time to Response,
 months

 1.4

 (95%
 CI b)

 (0.7,
 5.6)

 a)
 ORR,
 Objective Response Rate per Olsen, et all (2011) Global Response Score (GRS), by Independent
 Review Committee (IRC)

 b)
 CI
 = confidence interval

 Overall,
LYMPHIR was well-tolerated with the use of pre-medications, close patient monitoring, and prompt initiation of supportive measures and
drug management. There was no evidence of cumulative toxicity and most patients experienced low grade 1 or 2 treatment emergent adverse
events.

 Serious
adverse reactions occurred in 38% of patients who received LYMPHIR. Serious adverse reactions in > 2% of patients included capillary
leak syndrome (10%), infusion-related reaction (9%), sepsis (7%), skin infection (2.9%), pyrexia (2.9%), and rash (2.9%).

 Adverse
Reactions ( 10%) in Patients with Relapsed or Refractory Stage I-III CTCL Who Received

in E7777-G000-302

 N
 = 69

 Adverse
 Reaction

 All
 Grades
 (%)

 Grade
 3 or 4
 (%)

 Gastrointestinal disorders

 Nausea

 1.4

 Diarrhea

 Vomiting

 Constipation

 General disorders and administration
 site conditions

 Fatigue a

 Edema b

 1.4

 Chills

 1.4

 Fever c

 1.4

 Musculoskeletal and connective
 tissue disorders

 Musculoskeletal
 pain d

 2.9

 Arthralgia e

 Nervous
 system disorders

 Headache f

 Dizziness

 Mental
 status changes g

 Injury, poisoning and procedural
 complications

 Infusion-related reaction

 Skin and subcutaneous tissue
 disorders

 Rash h

 Pruritis i

 Vascular disorders

 Capillary leak syndrome

 Metabolism and nutrition
 disorders

 Decreased appetite

 1.4

 Eye disorders

 Vision
 changes j

 Investigations

 Weight increased

 Infections and infestations

 Skin infection

 1.4

 Renal and urinary disorders

 Renal
 insufficiency l

 2.9

 Psychiatric disorders

 Insomnia

 (a)
 fatigue, asthenia, and lethargy.

 (b)
 edema, edema peripheral generalized edema, face edema, swelling face, peripheral swelling.

 (c)
 fever, pyrexia, tumor associated fever.

 (d)
 musculoskeletal pain, back pain, neck pain, pain in extremity, myalgia, bone pain, flank
 pain.

 (e)
 arthralgia, joint swelling, joint range of motion decreased, musculoskeletal stiffness.

 (f)
 headache, migraine.

 (g)
 mental status changes, amnesia, confusional state, delirium, altered state of consciousness,
 hallucinations (including auditory), memory impairment, disturbance in attention, somnolence,
 cognitive disorder.

 (h)
 rash, dermatitis, drug eruption, erythema, palmar erythema, toxic skin eruption, rash maculo-papular,
 rash opular, rash pustular, rash pruritic, dermatitis exfoliative generalized, acute generalized
 exanthematous pustulosis.

 (i)
 pruritis, itching.

 (j)
 vision blurred, photopsia, visual impairment.

 (k)
 skin infection, skin bacterial infection, staphylococcal skin infection, cellulitis, impetigo.

 (l)
 renal failure, nephropathy, acute kidney injury, blood creatinine increased, renal impairment.

 Investigator
Initiated Trials

 We
believe there is an opportunity in the field of immuno-oncology and have undertaken two investigator-initiated trials to evaluate the
potential safety and efficacy of LYMPHIR for potential as an immuno-oncology combination therapy.

 A
Phase 1 trial was initiated in June 2021 at the University of Minnesota, Masonic Cancer Center. This study is a single-arm open-label
trial which has an estimated enrollment of 20 participants who will be administered denileukin diftitox prior to Chimeric Antigen Receptor,
("CAR-T") therapies. The Phase 1 study consists of two components: dose finding to establish a maximum tolerated dose ("MTD")
of denileukin diftitox in combination with CART-T therapies, and an extension component to provide an estimate of efficacy at that MTD.
(Title: Phase I/II Trial Using E7777 to Enhance Regulatory T-Cell Depletion Prior to CAR-T Therapy for Relapsed/Refractory B-Cell Lymphoma
(DLBCL). NCT04855253)

 A
second Phase 1 Study was initiated in September 2022 at the University of Pittsburg Medical Center, Hillman Cancer Center. This study
is an open-label, Phase 1/1b study to investigate the safety and efficacy of a combined regimen of pembrolizumab with T-regulatory cell
depletion and denileukin diftitox in patients diagnosed with recurrent or metastatic solid tumors in the second line setting. (Title:
The efficacy of T-regulatory cell depletion with E7777 combined with immune checkpoint inhibitor, pembrolizumab, in recurrent or metastatic
solid tumors: Phase I/II Study. NCT05200559).

 The
study consists of two parts. Part I is a dose escalation study of four cohorts (3,6,9,12 mcg of LYMPHIR) and is expected to enroll 18-30
patients. Part II is a dose expansion study of approximately 40 patients to evaluate the safety and tolerability of the recommended combination
dose of LYMPHIR and pembrolizumab (to include ovarian cancer and MSI-H cancer cohorts). The study will also investigate the alteration
of the immune microenvironment within tumors and peripheral blood. Secondary endpoints include the objective response (complete response
plus partial response), progression-free survival, and overall survival.

 Regulatory
Development

 In
the 1990's, denileukin diftitox was developed at Boston University and the National Cancer Institute ("NCI") in collaboration
with Seragen, Inc.

 In
1999, ONTAK (denileukin diftitox) was granted accelerated approval by the FDA for the treatment of persistent or recurrent CTCL.
Ligand Pharmaceuticals, Inc. ("Ligand") acquired the marketing rights in that same year.

 In
2006, Eisai acquired the commercial rights to ONTAK from Ligand.

 In
2008, the FDA granted full approval to ONTAK for CTCL.

 In
2011, a new formulation of denileukin diftitox was developed under the code name E7777 in response to a post-marketing condition established
by the FDA upon approval. As the FDA considered this a new product, an Investigational New Drug Application ("IND") was filed.
As a part of ensuing discussions, the FDA agreed to a development plan that included a single arm, open label study to confirm the safety
and efficacy of E7777 and a chemistry, manufacturing, and controls ("CMC") development plan that demonstrates the new process
results in a comparable drug product.

 In
2011, the FDA Office of Orphan Products Development granted E7777 orphan drug designation status for the treatment of Peripheral T-Cell
Lymphoma ("PTCL"). In 2013, the FDA Office of Orphan Products Development granted E7777 orphan drug designation status for
the treatment of CTCL.

 In
2013, the first patient was enrolled into the lead-in phase of the pivotal study for the E7777 United States ("U.S.") CTCL
clinical trial.

 In
2014, commercial sales of ONTAK were discontinued when the product was voluntarily withdrawn from the market due to manufacturing issues
at the contract manufacturer.

 In
2015, the last patient enrolled exited the lead-in phase of the E7777 U.S. CTCL clinical trial.

 In
March 2016, Dr. Reddy's acquired the global rights to E7777 from Eisai, other than far east countries, with Eisai retaining the
rights in those countries.

 In
June 2016, the first patient was enrolled in the main phase of the Phase 3 U.S. CTCL clinical trial for E7777.

 In
March 2020, Eisai filed an NDA for E7777 in Japan for both CTCL and PTCL, and in March 2021 received approvals in both indications.

 In
September 2021, Citius Pharma acquired the marketing rights to E7777 in selected markets. Citius Pharma subsequently renamed E7777 as
LYMPHIR.

 In
December 2021, patient enrollment for the Phase 3 Pivotal study of E7777 was completed.

 In
April 2022, we reported that topline results from the Phase 3 trial were consistent with the prior formulation. Moreover, no new safety
signals were identified.

 In
December 2022, a biologics license application ("BLA") for LYMPHIR was accepted for filing with the FDA and a PDUFA goal
date was set for July 28, 2023.

 In
July 2023, the FDA issued a complete response letter requiring us to incorporate enhanced product testing and additional controls agreed
to with the FDA during the market application review. There were no concerns relating to the safety and efficacy clinical data package
submitted with the BLA, or the proposed prescribing information.

 In
September 2023, we announced that the FDA has agreed with the plans to address the requirements outlined in the complete response letter,
which guidance has provided the Company with a path for completing the necessary activities to support the resubmission of the BLA for
LYMPHIR.

 CTCL's
are a heterogeneous subset of extranodal non-Hodgkin lymphomas ("NHL") of mature, skin-homing T-cells that are mainly localized
to the skin. The most common types of CTCL are mycosis fungoides ("MF") and primary cutaneous CD30+ anaplastic large cell
lymphoma (pcALCL), jointly representing an estimated 80 to 85% of all CTCL. S zary Syndrome ("SS"), a very rare subtype
(~2 to 5% of CTCL) characterized by diffuse inflammatory, often exfoliative, erythroderma and by leukemic and nodal involvement, displays
a significant degree of clinical and biological overlap with MF and has long been considered a clinical variant of MF, although recent
evidence suggests that it may be a separate entity. The rest is represented by extremely rare, generally more aggressive subtypes. In
light of the overlap between MF and SS, and considering that many of the systemic therapy options for the two neoplasms are the same,
some consider the treatment approach to MF and SS as if they were a single disease entity (MF/SS). However, some of the drugs currently
in use, or in development, for MF/SS appear to be more effective in clearing different anatomical compartments (skin versus blood, for
example) and therefore have differential efficacy in MF and SS.

 Based
on Surveillance Epidemiology and End Results (SEER) data from 2001 to 2007, the estimated incidence rate of MF/SS in the U.S. is 0.5/100,000
or about 2,500 to 3,000 new cases per year representing about 25% of all T-cell lymphomas.

 In
total, the Company estimates that there are approximately 30,000 to 40,000 patients living with CTCL in the U.S.

 Based
on internal estimates, the Company believes the addressable U.S. market for LYMPHIR exceeds $400,000,000 and may further expand with
the introduction of a new therapeutic.

 Proposed
Spinoff

 In
May 2022, we announced that we intend to split the Company's assets into two separate publicly traded entities (the "Spinoff").
Pursuant to that plan we formed a new company focused on developing and commercializing LYMPHIR. Our other pipeline assets, including
Mino-Lok, remain at Citius Pharma. Following the Spinoff, Citius Pharma would continue to trade on the Nasdaq Capital Market exchange
under its current ticker CTXR. The strategic action is intended to optimize organizational resources and investment capital to support
the successful execution of each development program.

 As
discussed above, in October 2023, the Company announced that we entered into the Merger Agreement, dated October 23, 2023, for a proposed
merger whereby TenX would acquire Citius Oncology. Following closing, the Combined Company would continue as a public company listed
on the Nasdaq Global Market. The transaction is expected to be completed in the first half of 2024, subject to approval by stockholders
of TenX and other customary closing conditions, including compliance with the Nasdaq initial listing requirements, final regulatory approvals,
and SEC filings. There can be no assurance regarding the ultimate timing of the proposed transaction or that the transaction will be
completed at all.

is a patented solution containing minocycline, disodium ethylenediaminetetraacetic acid (edetate), and ethyl alcohol, all of which act
synergistically to treat and salvage infected central venous catheters ("CVCs") in patients with catheter related bloodstream
infections ("CRBSIs"). Mino-Lok breaks down biofilm barriers formed by bacterial colonies, eradicates the bacteria, and provides
anti-clotting properties to maintain patency in CVCs.

 The
administration of Mino-Lok consists of filling the lumen of the catheter with 0.8 ml to 2.0 ml of Mino-Lok solution. The catheter is
then "locked", meaning that the solution remains in the catheter without flowing into the vein. The lock is maintained for
a dwell-time of two hours while the catheter is not in use. If the catheter has multiple lumens, all lumens may be locked with the Mino-Lok
solution either simultaneously or sequentially. If patients are receiving continuous infusion therapy, the catheters alternate between
being locked with the Mino-Lok solution and delivering therapy. The Mino-Lok therapy is two hours per day for at least five days, usually
with two additional locks in the subsequent two weeks. After locking the catheter for two hours, the Mino-Lok solution is aspirated,
and the catheter is flushed with normal saline. At that time, either the infusion will be continued, or will be locked with the standard-of-care
lock solution until further use of the catheter is required. In a clinical study conducted by MD Anderson Cancer Center ("MDACC"),
there were no serum levels of either minocycline or edetate detected in the sera of several patients who underwent daily catheter lock
solution with minocycline and edetate ("M-EDTA") at the concentration level proposed in Mino-Lok treatment. Thus, it has
been demonstrated that the amount of either minocycline or edetate that leaks into the serum is very low or none at all.

 Phase
2b Results

 From
April 2013 to July 2014, 30 patients with CVC-related bloodstream infection were enrolled at MDACC in a prospective Phase 2b study. Patients
received Mino-Lok therapy for two hours once daily for a minimum of five days within the first week, followed by two additional locks
within the next two weeks. Patients were followed for one month post-lock therapy. Demographic information, clinical characteristics,
laboratory data, therapy, as well as adverse events and outcome were collected for each patient. Median age at diagnosis was 56 years
(range: 21-73 years). In all patients, prior to the use of lock therapy, systemic treatment with a culture-directed, first-line intravenous
antibiotic was started. Microbiological eradication was achieved at the end of therapy in all cases. None of the patients experienced
any serious adverse event related to the lock therapy.

 The
active arm, which is the Mino-Lok treated group of patients, was then compared to 60 patients in a matched cohort that experienced removal
and replacement of their CVCs within the same contemporaneous timeframe. The patients were matched for cancer type, infecting organism,
and level of neutropenia. All patients were cancer patients and treated at MDACC. The efficacy of Mino-Lok therapy was 100% in salvaging
CVCs, demonstrating equal effectiveness to removing the infected CVC and replacing it with a new catheter.

 The
main purpose of the study was to show that Mino-Lok therapy was at least as effective as the removal and replacement of CVCs when CRBSIs
are present, and that the safety was better, that is, the complications of removing an infected catheter and replacing with a new one
could be avoided. In addition to having a 100% efficacy rate with all CVCs being salvaged, Mino-Lok therapy had no significant adverse
events ("SAEs"), compared to an 18% SAE rate in the matched cohort where patients had the infected CVCs removed and replaced
with a fresh catheter. There were no overall complication rates in the Mino-Lok arm group compared to 11 patients with events (18%) in
the control group. These events included bacterial relapse (5%) at four weeks post-intervention, and a number of complications associated
with mechanical manipulation in the removal or replacement procedure for the catheter (10%) or development of deep-seated infections
such as septic thrombophlebitis and osteomyelitis (8%). As footnoted, six patients had more than one complication in the control arm
group.

 Arm

 Control
 Arm

 Parameter

 N

 (%)

 N

 (%)%

 Patients

 (100
)%

 (100
)%

 Cancer
 type

 - Hematologic

 (67
)

 (80
)

 -
 Solid tumor

 (33
)

 (20
)

 ICU
 Admission

 (13
)

 (7
)

 Mech. Ventilator

 (10
)

 (0
)

 Bacteremia

 - Gram+

 (57
)*

 (53
)

 - Gram-

 (47
)*

 (47
)

 Neutropenia
 (<500)

 (63
)

 (60
)

 Microbiologic
 Eradication

 (100
)

 (100
)

 - Relapse

 (0
)

 (5
)

 Complications

 (0
)

 (13
)

 SAEs
 related R&R

 (0
)

 (10
)

 Overall
 Complication Rate

 (0
)%

 **

 (18
)%

 *
 Polymicrobial patient had a Gram+ and a Gram- organism cultured

 **
 Patients had > 1 complication

 Source:
Dr. Issam Raad, Antimicrobial Agents and Chemotherapy, June 2016, Vol. 60 No. 6, Page 3429

 Phase
3 Trial

 In
November 2016, the Company initiated site recruitment for Phase 3 clinical trials. From initiation through the first quarter of 2017,
the Company received input from several sites related to the control arm as being less than standard-of-care for some of the respective
institutions. The Company worked closely with the FDA with respect to the design of the Phase 3 trial and received feedback on August
17, 2017. The FDA stated that they recognized that there is an unmet medical need in salvaging infected catheters and agreed that an
open label, superiority design would address the Company's concerns and would be acceptable to meet the requirements of a new drug
application. The Company amended the Phase 3 study design to remove the saline and heparin placebo control arm and to use an active control
arm that conforms with today's current standard-of-care. Patient enrollment commenced in February 2018.

 The
Mino-Lok Phase 3 Trial was originally planned to enroll 700 patients in 50 participating institutions, all located in the U.S. There
were interim analyses at both the 50% and 75% points of the trial as measured by the number of patients treated.

 In
September 2019, the Company announced that the FDA agreed to a new primary efficacy endpoint of "time to catheter failure"
in comparing Mino-Lok to the antibiotic lock control arm. This change in the trial design reduced the required patient sample size of
the trial from 700 subjects to approximately 144 available subjects to achieve the pre-specified 92 catheter failure events needed to
conclude the trial. Additionally, the Company submitted a response to the FDA that it would implement this change in the primary endpoint
and expected it to result in less than 150 subjects needed in its Phase 3 trial. The new primary endpoints require that the time to catheter
failure be at least 38 days for Mino-Lok versus 21 days for the standard of care antibiotic locks.

 In
October 2019, the FDA agreed that the patient sample size of approximately 144 patients was acceptable.

 In
October 2019, the Company announced that the Phase 3 trial had reached the 40% completion triggering an interim futility analysis by
the data monitoring committee (the "DMC"). The DMC is an independent panel of experts that review progress regarding the
safety and efficacy of drugs in clinical trials, and to determine if the trial may be futile in achieving its endpoints or if the trial
should be modified in any way.

 In
December 2019, the DMC convened and recommended that the trial continue with no changes because the analysis showed a positive outcome,
as it met the prespecified interim futility analysis criteria.

 In
May 2020, we announced that we are providing free access to Mino-Lok for healthcare providers under an Expanded Access protocol to ease
the burden associated with the COVID-19 pandemic. Through the Expanded Access protocol, an infected central venous catheter can now be
treated with Mino-Lok, potentially avoiding the need for the removal and replacement procedure.

 In
June 2020, we announced that we had received positive feedback from the FDA on our proposed catheter compatibility studies for Mino-Lok.
The studies, if and when successfully completed, should allow Mino-Lok to be labeled for use with all commercially available CVCs and
peripherally inserted central catheters (PICCs) on the U.S. market. We further assume that these studies will meet European and world
standards. The ability to be labeled without restrictions with respect to catheter type would allow Mino-Lok unrestricted access to the
full U.S. and world markets for an effective antibiotic lock therapy for central line associated blood stream infections ("CLABSIs").

 In
September 2020, we announced that another DMC meeting was held to review the data being generated and analyzed in the Mino-Lok Phase
3 trial based on progress to date, and to make recommendations to us as to any action that may be necessary regarding the study. After
reviewing these data, the DMC members stated that they did not find any safety signals; and they also recommended continuing the trial
without any modifications. The DMC further conducted an ad hoc meeting and agreed with the Company that a 75% interim analysis
be conducted as planned in which superior efficacy is evaluated. The 75% interim analysis was subsequently changed to a 65% interim analysis
by the Company.

 In
September 2020, the Company announced that the three registration batches for all components of Mino Lok were manufactured and that clinical
sites were resupplied with registration product.

 In
November 2020, the Company announced that the three components of Mino-Lok, minocycline, disodium edetate ("EDTA"), and ethanol,
were superior to EDTA and ethanol in their ability to eradicate resistant staphylococcal biofilms.

 The
65% interim analysis was completed in June 2021. In July 2021, the Company announced that following an unblinded data review of safety
and efficacy, the independent DMC for the trial recommended proceeding with the trial as planned. The DMC did not identify any safety
concerns and no modifications were recommended to the protocol-defined sample size or power to achieve the primary endpoint.

 In
May 2022, the Company selected Biorasi, LLC ("Biorasi"), a global clinical research organization ("CRO"), to
help expand the Company's Phase 3 Mino-Lok trial by implementing additional sites outside the U.S. As of December 15, 2023,
there are 12 active sites in the U.S. currently including such academic centers as Henry Ford Health Center, Georgetown University
Medical Center, and others. There currently are 16 sites active in India, making a total of 28 participating Mino-Lok institutions globally.

 In
August 2023, the Company announced all 92 events required to complete the trial have been achieved. Several patients remain in active
treatment, which may result in additional events.

 In late December 2023, the Company determined that patient enrollment
for the Mino-Lok trial was complete and that it would begin site shutdown activities. Topline results are anticipated in the first half
of 2024.

 Fast
Track Designation

 In
October 2017, the Company received official notice from the FDA that the investigational program for Mino-Lok was granted "Fast
Track" status. Fast Track is a designation that expedites FDA review to facilitate development of drugs which treat a serious or
life-threatening condition and fill an unmet medical need. A drug that receives Fast Track designation is eligible for the following:

 More
 frequent meetings with the FDA to discuss the drug's development plan and ensure collection
 of appropriate data needed to support drug approval;

 More
 frequent written correspondence from the FDA about the design of the clinical trials;

 Priority
 review to shorten the FDA review process for a new drug from ten months to six months; and

 Rolling
 review, which means we can submit completed sections of our New Drug Application ("NDA")
 for review by the FDA, rather than waiting until every section of the application is completed
 before the entire application can be submitted for review.

International Study

 In
October 2017, data from an international study on Mino-Lok was presented at the Infectious Disease Conference, ("ID Week"),
in San Diego, California. The 44-patient study was conducted in Brazil, Lebanon and Japan and showed Mino-Lok therapy was an effective
intervention to salvage long-term, infected CVCs in CRBSIs in patients who had cancer with limited vascular access. This study showed
95% effectiveness for Mino-Lok therapy in achieving microbiological eradication of the CVCs as compared to 83% for the control. The single
failure in the Mino-Lok arm was due to a patient with Burkholderia cepacia that was resistant to all antibiotics tested.

 Stability
Patent Application for Mino-Lok

 In
October 2018, the U.S. Patent and Trademark Office ("USPTO") issued U.S. Patent No. 10,086,114, entitled "Antimicrobial
Solutions with Enhanced Stability." On October 9, 2019, the European Patent Office ("EPO") granted European Patent
No. 3370794, entitled "Antimicrobial Solutions with Enhanced Stability." The grant of this European patent strengthens the
intellectual property protection for Mino-Lok through November of 2036. This invention overcomes limitations in mixing antimicrobial
solutions in which components have precipitated because of physical and/or chemical factors, thus limiting the stability of the post-mix
solutions. The scientists and technologists at MDACC have been able to improve the stability of the post-mixed solutions through adjustments
of the post-mixed pH of the solution. This may allow for longer storage time of the ready-to-use solution. Citius Pharma holds the exclusive
worldwide license which provides access to this patented technology for development and commercialization of Mino-Lok.

 In
spite of best clinical practice, catheters contribute to approximately 70% of blood stream infections that occur in the intensive care
unit or are associated with hemodialysis or cancer patients (approximately 470,000 per year). Bacteria enter the catheter either from
the skin or intraluminally through the catheter hub. Once in the catheter, bacteria tend to form a protective biofilm on the interior
surface of the catheter that is resistant to most antimicrobial solutions. The most frequently used maintenance flush, heparin, actually
stimulates biofilm formation. Heparin is widely used as a prophylactic lock solution, in spite of the evidence that it contributes to
the promotion of biofilm formation. The formation of bacterial biofilm usually precedes CRBSIs.

 The
standard of care in the management of CRBSI patients consists of removing the infected CVC and replacing it with a new catheter at a
different vascular access site. However, in cancer and hemodialysis patients with long-term surgically implantable silicone catheters,
removal of the CVC and reinsertion of a new one at a different site might be difficult, or even impossible, because of the unavailability
of other accessible vascular sites and the need to maintain infusion therapy. Furthermore, critically ill patients with short-term catheters
often have underlying coagulopathy, which makes reinsertion of a new CVC at a different site, in the setting of CRBSIs, risky in terms
of mechanical complications, such as pneumothorax, misplacement, or arterial puncture. Studies have also revealed that CRBSI patients
may be associated with serious complications, including septic thrombosis, endocarditis and disseminated infection, particularly if caused
by Staphylococcus aureus or Candida species. Furthermore, catheter retention in patients with CRBSIs is associated with
a higher risk of relapse and poor response to antimicrobial therapy.

 According
to Maki et al., published in the Mayo Clinic Proceedings in 2006, there are approximately 250,000 CRBSIs annually in the U.S.
Subsequent to this study, our estimates have ranged upwards to over 450,000 CLABSIs annually (see analysis in the table below). CRBSIs
are associated with a 12% to 35% mortality rate and an attributable cost of $35,000 to $56,000 per episode.

 We
estimate that the potential market for Mino-Lok in the U.S. to be approximately $500 million to $1 billion as shown in the table below
based on a target price of up to $400 per dose of each salvage flush treatment.

 Short-Term

 CVC

 Long-Term

 CVC

 Total

 No.
 of Catheters

 Avg.
 Duration (Days)

 N/A

 Catheter
 Days

 Infection
 Rate

 2/1,000
 days

 1/1,000
 days

 N/A

 Catheters
 Infected

 72,000

 400,000

 472,000

 Flushes/Catheter

 6.7

 Total
 Salvage Flushes

 360,000

 2,800,000

 3,160,000

 Sources:
Ann Intern Med 2000; 132:391-402, Clev Clin J Med 2011; 78(1):10-17, JAVA 2007; 12(1):17-27, J Inf Nurs 2004;27(4):245-250, Joint Commission
website Monograph, CLABSI and Internal Estimates.

 Under
various plausible pricing scenarios, we believe that Mino-Lok would be cost-saving to the healthcare system given that the removal of
an infected CVC and replacement of a new catheter in a different venous access site is estimated by us to cost between $8,000 and $10,000.
Furthermore, there are potential additional medical benefits, a reduction in patient discomfort and avoidance of serious adverse events
with the Mino-Lok approach since the catheter remains in place and is not subject to manipulation. We believe there will be an economic
argument to enhance the adoption of Mino-Lok by infection control committees at acute care institutions.

 In
January of 2017, we commissioned a primary market research study with MEDACore, a subsidiary of Leerink, a healthcare focused network
with more than 35,000 healthcare professionals, including key opinion leaders, experienced practitioners and other healthcare professionals
throughout North America, Europe, Asia and other locations around the world. This network includes approximately 55 clinical specialties,
21 basic sciences and 20 business specialties. As part of this market research project, we commissioned a third-party survey of 31 physicians
to qualify the need for catheter salvage in patients with infected, indwelling central venous lines, especially when the catheter is
a tunneled or an implanted port. There were 19 infectious disease experts and 12 intensivists surveyed who all agreed that salvage would
be preferable to catheter exchange to avoid catheter misplacements, blood clots, or vessel punctures that can potentially occur during
reinsertion. Most were also concerned that viable venous access may not be available in patients who were vitally dependent on a central
line.

 Halo-Lido

 Halo-Lido
is a topical formulation of halobetasol propionate, a corticosteroid, and lidocaine that is intended for the treatment of hemorrhoids.
To our knowledge, there are currently no FDA-approved prescription drug products for the treatment of hemorrhoids. Some physicians are
known to prescribe topical steroids for the treatment of hemorrhoids. In addition, there are various topical combination prescription
products containing halobetasol propionate along with lidocaine or pramoxine, each a topical anesthetic, that are prescribed by physicians
for the treatment of hemorrhoids. These products contain drugs that were in use prior to the start of the Drug Efficacy Study Implementation
("DESI") program and are commonly referred to as DESI drugs. However, none of these single-agent or combination prescription
products have been clinically evaluated for safety and efficacy and approved by the FDA for the treatment of hemorrhoids. Further, many
hemorrhoid patients use over the counter ("OTC") products as their first line therapy. OTC products contain any one of several
active ingredients including glycerin, phenylephrine, pramoxine, white petrolatum, shark liver oil and/or witch hazel, for symptomatic
relief.

 Development
of Hemorrhoids Drugs

 Hemorrhoids
are a common gastrointestinal disorder, characterized by anal itching, pain, swelling, tenderness, bleeding and difficulty defecating.
In the U.S., hemorrhoids affect nearly 5% of the population, with approximately 10 million persons annually admitting to having symptoms
of hemorrhoidal disease. Of these persons, approximately one third visit a physician for evaluation and treatment of their hemorrhoids.
The data also indicate that for both sexes a peak of prevalence occurs from age 45 to 65 years with a subsequent decrease after age 65
years. Caucasian populations are affected significantly more frequently than African Americans, and increased prevalence rates are associated
with higher socioeconomic status in men but not women. Development of hemorrhoids before age 20 is unusual. In addition, between 50%
and 90% of the general U.S., Canadian and European population will experience hemorrhoidal disease at least once in life. Although hemorrhoids
and other anorectal diseases are not life-threatening, individual patients can suffer from agonizing symptoms which can limit social
activities and have a negative impact on the quality of life.

 Hemorrhoids
are defined as internal or external according to their position relative to the dentate line. Classification is important for selecting
the optimal treatment for an individual patient. Accordingly, physicians use the following grading system referred to as the Goligher's
classification of internal hemorrhoids:

 Grade I

 Hemorrhoids not prolapsed
 but bleeding.

 Grade II

 Hemorrhoids prolapse and
 reduce spontaneously with or without bleeding.

 Grade III

 Prolapsed hemorrhoids that
 require reduction manually.

 Grade IV

 Prolapsed and cannot be
 reduced including both internal and external hemorrhoids that are confluent from skin tag to inner anal canal.

 Development
Activities to Date

 In
the fall of 2015, we completed dosing patients in a double-blind dose ranging placebo-controlled Phase 2a study where six different formulations
containing hydrocortisone and lidocaine in various strengths were tested against the vehicle control. The objectives of this study were
to: (1) demonstrate the safety and efficacy of the formulations when applied twice daily for two weeks in subjects with Grade I or II
hemorrhoids, and (2) assess the potential contribution of lidocaine hydrochloride and hydrocortisone acetate, alone or in combination
for the treatment of symptoms of Goligher's Classification Grade I or II hemorrhoids.

 Symptom
improvement was observed based on a global score of disease severity ("GSDS") and based on some of the individual signs and
symptoms of hemorrhoids, specifically itching and overall pain and discomfort. Within the first few days of treatment, the combination
products (containing both hydrocortisone and lidocaine) were directionally favorable versus the placebo and their respective individual
active treatment groups (e.g., hydrocortisone or lidocaine alone) in achieving 'almost symptom free' or 'symptom free'
status according to the GSDS scale. These differences suggested the possibility of a benefit for the combination product formulation.
As a result of this study, we determined that the performance of the active arms of the study relative to the vehicle could be improved
by re-formulating our topical preparation. Therefore, we initiated work on vehicle formulation and evaluation of higher potency steroids.

 Overall,
results from adverse event reporting support the safety profile of all test articles evaluated in this study and demonstrate similar
safety profiles as compared to the vehicle. The safety findings were unremarkable. There was a low occurrence of adverse events and a
similar rate of treatment related adverse events across all treatment groups. The majority of adverse events were mild and only one was
severe. None of the adverse events were an SAE and the majority of adverse events were recovered/resolved at the end of the study. There
were only two subjects who were discontinued from the study due to adverse events.

 As
part of this Phase 2 trial, information was obtained relating to the use of the GSDS as an assessment tool for measuring the effectiveness
of the test articles. Individual signs and symptoms were also assessed but can vary from patient to patient. Therefore, the goal of the
GSDS was to provide an assessment tool that could be used for all patients regardless of which signs and symptoms they are experiencing.
The GSDS proved to be a more effective tool for assessing the severity of the disease and the effectiveness of the drug when compared
to the assessment of the individual signs and symptoms.

 We
developed this assessment tool as well as other patient reported outcome endpoints for use in the recently begun Phase 2b trial and in
subsequent trials. In June and July 2016, we engaged the Dominion Group, a leading provider of healthcare and pharmaceutical marketing
research services. The primary market research was conducted to understand the symptoms that are most bothersome to patients better in
order to develop meaningful endpoints for the clinical trials. We also learned about the factors that drive patients to seek medical
attention for hemorrhoids in an effort to understand the disease impact on quality of life. The results of this survey, along with the
information from the Phase 2b trial, allowed us to develop our patient reported outcome evaluation tool, ePro. This tool can be used
in clinical trials to evaluate the patients' conditions and to assess the performance of the test articles.

 In
March 2018, we announced that we had selected a higher potency corticosteroid in our steroid/anesthetic topical formulation program for
the treatment of hemorrhoids. The original topical preparation, which we referred to as Hydro-Lido or CITI-001, which was used in the
Phase 2a study, was a combination of hydrocortisone acetate and lidocaine hydrochloride. The new formulation, CITI-002, which we refer
to as Halo-Lido, combine lidocaine with the higher potency corticosteroid halobetasol propionate for symptomatic relief of the pain and
discomfort of hemorrhoids.

 We
held a Type C meeting with the FDA in December 2017 to discuss the results of the Phase 2a study and to obtain the FDA's view on
development plans to support the potential formulation change for the planned Phase 2b study. We also requested the FDA's feedback
on our Phase 2b study design, including target patient population, inclusion/exclusion criteria, and efficacy endpoints. The pre-clinical
and clinical development programs for CITI-002 are planned to be similar to those conducted for the development of CITI-001 to support
the design for a planned Phase 3 clinical trial.

 CITI-002
Phase 2b Trial Overview

 Approximately
300 adults with a clinical diagnosis of symptomatic hemorrhoids were enrolled in the Halo-Lido Phase 2b study (NCT05348200), a multi-center,
randomized, dose-ranging, double-blind, parallel group comparison clinical trial, which was initiated in April 2022. The study assessed
a high dose (CITI-002H) and low dose (CITI-002L) formulation of the combination drug products in comparison to the single active drug
monads: high dose halobetasol, low dose halobetasol and lidocaine.

 Recently,
there has been a shift from the use of traditional clinical analysis and outcomes to patients' perspectives and patients'
experiences in assessing treatment efficacy. Following the 21 st Century Cures Act, higher emphasis is placed on using
Patient Reported Outcome ("PRO") instruments in clinical trials. Currently, for hemorrhoidal disease, there are no
validated clinical outcomes assessment ("COA") tools available in the US. The FDA directed Citius Pharma to develop a "fit
for purpose" PRO instrument to assess the efficacy of treatments in this disease. Symptom intensity and impact data (Hemorrhoid
Quality of Life Index or "HQLI") were recorded by patients utilizing a proprietary mobile-enabled PRO instrument developed
by the Company for this study.

 Data
collected using the HQLI was analyzed to derive a meaningful change threshold ("MCT") to test for the change in hemorrhoidal
symptoms considered relevant to the patient during and following treatment.

 CITI-002
Phase 2b Trial Results

 In
June 2023, we announced positive results from the Phase 2b study of Halo-Lido for the treatment of hemorrhoids. Treatment effect on hemorrhoidal
symptoms was analyzed using the MCT. At the end of the seven-day treatment period, 42% of the patients in the high dose CITI-002 (CITI-002H)
group reached MCT compared to patients treated with high dose halobetasol alone (29%) or patients treated with lidocaine alone (21%).
Moreover, proportionally more patients in the CITI-002H cohort reported meaningful and statistically significant improvement as compared
to patients treated with lidocaine alone ( CMH test, p = 0.035).

 We
additionally assessed clinical treatment efficacy outcomes during seven-day treatment and seven-day follow-up periods using an analysis
of covariance, which analyzed changes from baseline. Substantial improvements were seen across all active treatment groups. Although
no statistical significance was determined in the changes between the comparison groups, directionally the data signaled that the combination
products provided faster relief compared to individual monads, and the relief persisted after completing treatment.

 In
addition, results from the study indicated that there were no material clinical safety concerns across the five active treatment groups
during the seven-day treatment or follow-up periods. There were no serious adverse events reported.

 Data
from the Phase 2b trial confirmed that the HQLI is appropriate to measure patient-reported changes in hemorrhoidal symptoms. Consequently,
Citius Pharma believes the instrument can be used in future Phase 3 trial development. Citius Pharma is actively pursuing intellectual
property protections for its groundbreaking work in developing the fit for purpose PRO instrument and has filed patent applications on
its CITI-002 formulations.

 Based
on the positive clinical results utilizing the Meaningful Change Threshold analysis, Citius Pharma plans to present this data at the
end of Phase 2 meeting with the FDA.

 The
current market for OTC and topical prescription ("Rx") products for the symptomatic treatment of hemorrhoids is highly fragmented
and includes approximately 20 million units of OTC and over 4 million prescriptions. None of the Rx products have received FDA approval
and are only available due to the DESI program, which started decades ago after enactment of the 1962 Kefauver-Harris Drug Amendments.
These DESI products have no FDA reviewed evidence of efficacy or safety and may be subject to withdrawal if an approved product were
to be introduced. Several topical combination prescription products for the treatment of hemorrhoids are available containing hydrocortisone
in strengths ranging from 0.5% to 3.0%, combined with lidocaine in strengths ranging from 1.0% to 3.0%. The various topical formulations
include creams, ointments, gels, lotions, enemas, pads, and suppositories. The most commonly prescribed topical combination gel is sold
as a branded generic product and contains 2.5% hydrocortisone and 3.0% lidocaine.

 We
believe there are currently no FDA-approved prescription drug products for the treatment of hemorrhoids. Although there are numerous
Rx and OTC products commonly used to treat hemorrhoids, none possess proven safety and efficacy data generated from rigorously conducted
clinical trials. We believe that a novel topical formulation of halobetasol propionate and lidocaine designed to provide anti-inflammatory
and anesthetic relief and which has an FDA-approved label specifically claiming the treatment of hemorrhoids will become an important
treatment option for physicians who want to provide their patients with a therapy that has demonstrated safety and efficacy in treating
this uncomfortable and often recurring disease. We believe that our Halo-Lido product represents an attractive, low-risk product opportunity
with meaningful upside potential.

Exclusivity

 We
believe that we will be the first company to conduct rigorous clinical trials and receive FDA approval of a topical corticosteroid-lidocaine
combination product for the treatment of hemorrhoids. If we receive FDA approval, we will qualify for three years of market exclusivity
for our dosage strength and formulation. In addition, we will also be the only product on the market specifically proven to be safe and
effective for the treatment of hemorrhoids. Generally, if a company conducts clinical trials and receives FDA approval of a product for
which there are similar, but non FDA-approved, prescription products on the market, the manufacturers of the unapproved but marketed
products are required to withdraw them from the market. However, the FDA has significant latitude in determining how to enforce its regulatory
powers in these circumstances. We have not had any communication with the FDA regarding this matter and cannot predict what action, if
any, the FDA will take with respect to the unapproved products.

 We
believe that should Halo-Lido demonstrate, proven safety and efficacy data and receive FDA approval, and if Halo-Lido obtains three years
of market exclusivity based on our dosage strength and formulation, we are likely to have a meaningful advantage in our pursuit of achieving
a significant position in the market for topical combination prescription products for the treatment of hemorrhoids.

 Mino-Wrap

 On
January 2, 2019, we entered into a patent and technology license agreement with the Board of Regents of the University of Texas System
on behalf of MDACC, whereby we in-licensed exclusive worldwide rights to the patented technology for any and all uses relating to breast
implants, specifically the Mino-Wrap technology. This includes rights to U.S. Patent No. 9,849,217, which was issued on December 16,
2017. We intend to develop Mino-Wrap as a liquefying, gel-based wrap containing minocycline and rifampin for the reduction of infections
associated with breast implants following breast reconstructive surgeries. We are required to use commercially reasonable efforts to
commercialize Mino-Wrap under several regulatory scenarios and achieve milestones associated with these regulatory options leading to
an approval from the FDA. Mino-Wrap will require pre-clinical development prior to any regulatory pathway. In July 2019, we announced
that we intend to pursue the FDA's IND regulatory pathway for the development of Mino-Wrap. On August 4, 2020, we announced that
we had submitted a briefing package to the FDA for a pre-IND consultation on Mino-Wrap.

 In
December 2020, the Company announced the receipt of a written response and guidance from the FDA Division of Anti-Infective Products
to the Company's Pre-IND consultation request for its Mino-Wrap briefing package. The briefing package contained information regarding
pre-clinical data and a clinical development plan, along with questions for the FDA regarding safety and efficacy data that would be
required to advance Mino-Wrap into clinical trials. The FDA granted a Written Response Only meeting regarding guidance and direction
on our Mino-Wrap development plan. The FDA indicated that bio absorption simulation studies may provide information to support the development
of Mino-Wrap and made suggestions on what should be provided relative to non-clinical support. The FDA provided guidance on the
design of the drug elution studies and agreed that a large animal pharmacology study would be appropriate. They also agreed that
a 28-day toxicology study appears appropriate and that microbiology support through existing data is acceptable.

 On December 11, 2023, the Company terminated the Mino-Wrap license
agreement with the Board of Regents of the University of Texas System on behalf of MDACC.

 Breast
cancer is the most frequent cancer in women worldwide, representing 25% of all cancer diagnoses with the exception of non-melanoma skin
cancer. In the U.S., the overall rate of mastectomies, combining single and double mastectomies, increased 36% from 2005 to 2013. Additionally,
the incidence of post-mastectomy breast reconstruction, following breast cancer treatment, has been increasing on an annual basis.

 In
2017, the American Society of Plastic Surgeons reported that over 105,000 women in the U.S. underwent a post-mastectomy breast reconstructive
procedure. Approximately 30% of these breast reconstructions occur simultaneously with mastectomy, with most reconstructions occurring
weeks later.

 The
current standard of care in post-mastectomy breast reconstruction is the use of a Tissue Expander ("TE"), which is a temporary
implant that is placed below the pectoralis muscle within the mastectomy space. Once a sufficiently large soft tissue envelope has been
created, the TE is then replaced by a permanent breast implant. Approximately 80% of the time, a TE is used in breast reconstructions.

 The
rate of infection following a mastectomy with a TE is 2.4 to 24% with an estimated mean of 12-14%. Once the implant becomes infected,
the patient is usually hospitalized requiring approximate two weeks of IV and/or oral antimicrobials. In addition, the TE is removed,
leading to a delay of lifesaving chemo-radiation therapy, and a more complex reconstruction in the future.

 Currently,
preventive measures are used to decrease the rate of TE infections, which include a systemic perioperative antimicrobial agent with the
perioperative immersion of the implant or irrigation of the surgical pocket with an antimicrobial solution prior to insertion of the
device. This is also administered with immediate postoperative oral antimicrobials.

 Based
on the in vitro preclinical laboratory work, Mino-Wrap appears to have the characteristics necessary for advancement in the protection
of human implants from subsequent infection.

 In
October 2020, we, through our subsidiary, NoveCite, signed an exclusive agreement with Novellus Therapeutics Limited ("Novellus")
to license iPSC-derived mesenchymal stem cells (iMSCs). Under this worldwide exclusive license, we are focused on developing cellular
therapies. Specifically, we are seeking to develop and commercialize the NoveCite mesenchymal stem cells ("NC- i MSCs")
to treat acute respiratory conditions with a near term focus on ARDS.

 NC- i MSCs
are the next generation mesenchymal stem cell therapy. We believe them to be differentiated and superior to donor-derived MSCs. Human
donor-derived MSCs are sourced from human bone marrow, adipose tissue, placenta, umbilical tissue, etc. and have significant challenges
(e.g., variable donor and tissue sources, limited supply, low potency, inefficient and expensive manufacturing). NC-iMSCs overcome these
challenges because they:

 Are more
 potent and secrete exponentially higher levels of immunomodulatory proteins;

 Have practically unlimited
 supply for high doses and repeat doses;

 Are from a single donor
 and clonal so they are economically produced at scale with consistent quality and potency, as well as being footprint free (compared
 to viral reprogramming methods); and

 Have a significantly higher
 expansion capability.

 Several
cell therapy companies using donor-derived MSC therapies in treating ARDS have demonstrated that MSCs reduce inflammation, enhance clearance
of pathogens and stimulate tissue repair in the lungs. Almost all these positive results are from early clinical trials or under the
FDA's emergency authorization program.

 In
December 2020, the Company announced interim data from a proof-of-concept ("POC") large animal study of its proprietary NC-iMSC
therapy. The available results of NC-iMSC therapy in the study show improvement in critical parameters, such as improved oxygenation,
less systemic shock, and reduced lung injury, compared to the control group. The study was conducted in a widely accepted large animal
model.

 In
the third quarter of 2021, the Company completed the characterization and expansion of its NC-iMSC accession cell bank (ACB) at Waisman
Biomanufacturing at the University of Wisconsin-Madison to create a cGMP master cell bank (MCB).

 In
July 2021, Novellus was acquired by Brooklyn ImmunoTherapeutics, Inc. ("Brooklyn"). Pursuant to this transaction, the NoveCite
license was assumed by Brooklyn with all of the original terms and conditions in the exclusive license agreement.

 In
October 2022, Brooklyn changed its name to Eterna Therapeutics Inc.

 Globally,
there are 3 million cases of ARDS every year, out of which approximately 200,000 cases are in the U.S. The COVID-19 outbreak has added
significantly to the number of ARDS cases. Once COVID-19 patients advance to ARDS, they are put on mechanical ventilators. Death rate
among patients on ventilators can be as high as 50% depending on associated co-morbidities. There are no approved treatments for ARDS,
and the current standard of care only attempts to provide symptomatic relief.

 Sales
and Marketing

 We
are primarily focused on identifying opportunities within the critical care and cancer care market segments. In our product acquisition
criteria, we concentrate on markets that are highly influenced by key opinion leaders, commonly referred to as KOLs, and in which products
are prescribed by a relatively small number of physicians, yet provide opportunities for growth and market share. This strategy allows
for a manageable commercialization effort for our Company in terms of resources and capital. We also seek to provide cost-effective therapies
that would be endorsed by payers, patients, and providers. We believe that we will be able to commercialize products within the scope
of these criteria ourselves, and that we can create marketing synergies by having a common narrow audience for our marketing efforts
("several products in the bag for the same customer").

 For
our product candidates that fall out of the narrow scope criteria, we have identified pharmaceutical companies with large sales forces,
experienced sales and marketing management teams, direct-to-consumer capabilities, significantly larger resources than ours, and non-competing
product portfolios that we believe would make excellent sales and marketing partners. We intend to license our mass audience, non-specialty
product candidates to such companies for sales and marketing.

Sales and Marketing

Oncology does not currently have its own commercial infrastructure and is in the early stages of developing its sales or marketing capability
by contracting with a large third-party commercial sales and marketing organization with an existing commercial infrastructure and product
launch experience to assist in its commercial efforts. Citius Oncology intends to utilize a dedicated field force combined with various
marketing programs which will be tailored to both physicians and patients to launch LYMPHIR and grow its market share. We, through Citius
Oncology, plan to focus our commercial efforts on a concentrated group of prescribing hematologists, oncologists and dermatologist-oncologists,
along with key opinion leaders and advocacy groups who play an important role in the CTCL treatment regimen. Our strategy includes seeking
inclusion in the National Comprehensive Cancer Network ("NCCN") guidelines and compendia as well as obtaining coverage and
reimbursement from the Centers for Medicare and Medicaid Services.

 Intellectual
Property

 We
rely on a combination of patent, trade secret, copyright, and trademark laws, as well as confidentiality, licensing and other agreements,
to establish and protect our proprietary rights. Our policy is to actively seek to obtain, where appropriate, the broadest intellectual
property protection possible for our current product candidates and any future product candidates both in the U.S. and abroad. However,
patent protection may not provide us with complete protection against competitors who seek to circumvent our patents. To help protect
our proprietary know-how that is not patentable, and for inventions for which patents may be difficult to enforce, we currently rely
and will in the future rely on trade secret protection and confidentiality agreements to protect our interests.

 On
September 3, 2021, we acquired the exclusive license of E7777 (denileukin diftitox), a late-stage oncology immunotherapy for the treatment
of CTCL from Eisai, who acquired it previously from Dr. Reddy's. We refer to the agent as LYMPHIR. The exclusive license, which
was amended as part of the transaction, is with Eisai and includes rights to develop and commercialize LYMPHIR in all markets except
for Japan and certain parts of Asia. The license includes an option on the right to develop and market the product in India. In April
2022, Citius Pharma assigned the license agreement to Citius Oncology, at which time Citius Oncology began operations.

 Under
the license agreement, Eisai is to receive a $6 million development milestone payment upon initial approval by the FDA of LYMPHIR for
the CTCL indication (which increase to $7 million in the event Citius Oncology exercises the option to add India to the licensed territory)
and an aggregate of up to $22 million related to the achievement of net product sales thresholds. Pursuant to the terms of the license
agreement, Citius Pharma reimbursed Eisai for approximately $2.65 million of Eisai's costs to complete the ongoing Phase 3 pivotal
clinical trial for LYMPHIR for the CTCL indication and for all reasonable costs associated with the preparation of a BLA for LYMPHIR.

to the terms of the license agreement, Eisai was responsible for completing the current CTCL clinical trial, and chemistry, manufacturing
and controls development activities through the production of the BLA, which we filed with the FDA in September 2022, while we are responsible
for the costs of correcting any major deficiencies in the BLA as well as the costs of any further studies and development costs associated
with potential additional indications.

 The
term of the license agreement will continue until (i) March 30, 2026, if there has not been a commercial sale of a licensed product in
the territory, or (ii) if there has been a first commercial sale of a licensed product in the territory by March 30, 2026, the 10-year
anniversary of the first commercial sale on a country-by-country basis. The term of the license may be extended for additional 10-year
periods for all countries in the territory by notifying Eisai and paying an extension fee equal to $10 million. Either party may terminate
the license agreement upon written notice if the other party is in material breach of the agreement, subject to cure within the designated
time periods. Either party also may terminate the license agreement immediately upon written notice if the other party files for bankruptcy
or takes related actions or is unable to pay its debts as they become due. Additionally, either party will have the right to terminate
the agreement if the other party directly or indirectly challenges the patentability, enforceability, or validity of any licensed patent.

 We,
through our subsidiary, are responsible for preparing, filing, prosecuting, and maintaining all patent applications and patents included
in the licensed patents that we intend to pursue within the territory.

 Under
the terms of the agreement with Dr. Reddy's, we, through our subsidiary, are obligated to pay up to an aggregate of $40 million
related to CTCL approvals in the U.S. and other markets, up to $70 million in development milestones for additional indications, and
up to $300 million for commercial sales milestones. We, through our subsidiary, will also be obligated to pay on a fiscal quarter basis
tiered royalties equal to low double-digit percentages of net product sales. The royalties will end on the earlier of (i) the 15-year
anniversary of the first commercial sale of the latest indication that received regulatory approval in the applicable country and (ii)
the date on which a biosimilar product results in the reduction of net sales in the applicable product by 50% in two consecutive quarters,
as compared to the four quarters prior to the first commercial sale of the biosimilar product. We, through our subsidiary, will also
pay to Dr. Reddy's an amount equal to a low-thirties percentage of any sublicense upfront consideration or milestone payments (or
the like) received by Citius Oncology and the greater of (i) a low-thirties percentage of any sublicensee sales-based royalties or (ii)
a mid-single digit percentage of such licensee's net sales.

 Also
under the agreement with Dr. Reddy's, we, through our subsidiary, are required to (i) use commercially reasonable efforts to make
commercially available products in the CTCL indication, peripheral T-cell lymphoma indication and immuno-oncology indication, (ii) initiate
two investigator initiated immuno-oncology trials, (iii) use commercially reasonable efforts to achieve each of the approval milestones,
and (iv) complete each specified immuno-oncology investigator trial on or before the four-year anniversary of the effective date of the
definitive agreement. Additionally, we are required to commercially launch a product in a territory within six months of receiving regulatory
approval for such product in each such jurisdiction.

 Patents

 As
part of the definitive agreement with Dr. Reddy's, the Citius Pharma acquired, and later transferred to Citius Oncology, method
of use patents in which E7777 is administered in combination with the programmed cell death protein 1 ("PD-1") pathway inhibitor
drug class. PD-1 plays a vital role in inhibiting immune responses and promoting self-tolerance through modulating the activity of T-cells,
activating apoptosis of antigen-specific T cells and inhibiting apoptosis of regulatory T cells.

 The
following patents were acquired:

 US
Provisional Application No. 63/070,645, which was filed on August 26, 2020, and subsequently published as US 2022/0062390 A1 on March
3, 2022, entitled Methods of Treating Cancer.

 International
Patent Application Number: PCT/IB2021/0576733, which was filed with the World Intellectual Property Organization on August 23, 2021,
and subsequently published as WO 2022/043863 A1 on March 3, 2022, entitled, Combination for Use in Methods of Treating Cancer.

 In
May 2014, our subsidiary LMB entered into a patent and technology license agreement with Novel Anti-Infective Therapeutics, Inc. ("NAT"),
who licensed the intellectual property from MDACC, to develop and commercialize Mino-Lok on an exclusive, worldwide (except for South
America), sub-licensable basis. LMB incurred a one-time license fee in May 2014. On March 20, 2017, LMB entered into an amendment to
the license agreement that expanded the licensed territory to include South America, providing LMB with worldwide rights. We are obligated
to pay annual maintenance fees that increase annually until reaching a designated amount, which we must pay until the first sale of product.
We also must pay up to an aggregate of approximately $1.1 million in milestone payments, depending on the achievement of various regulatory
and commercial milestones. Under the terms of the license agreement, we also must pay a royalty equal to mid-single digit percentages
to low-double digit percentages of net sales, depending on the level of sales in that year, and subject to downward adjustment to lower-
to mid-single digit percentages in the event there is no valid patent for the product in the country of sale at the time of sale. After
the first sale of product, we will owe an annual minimum royalty payment that will increase annually until reaching a designated amount,
which we must pay for the duration of the term. We will be responsible for all patent expenses for the term of the agreement although
MDACC is responsible for filing, prosecution and maintenance of all patents.

 Unless
earlier terminated by NAT based on the failure to achieve certain development or commercial milestones, the license agreement remains
in effect until the date that all patents licensed under the agreement have expired and all patent applications within the licensed patent
rights have been cancelled, withdrawn or expressly abandoned. The license agreement will terminate in the event we breach any of our
payment or reporting obligations or NAT breaches any of its obligations under the agreement. NAT will have the right to terminate the
agreement if we bring or participate in an action to challenge NAT's ownership of any of the licensed patent rights. We may terminate
the license agreement upon 180 days' notice. The license agreement may also be terminated upon our and NAT's mutual consent.

is covered in relation to the composition by issued U.S. patent No. 7,601,731, entitled "Antimicrobial Flush Solutions,"
which was issued on October 13, 2009. Mino-Lok is further covered in relation to its method of use by issued U.S. Patent No. 9,078,441,
which was issued on July 14, 2015. The patents provide intellectual property protection until June 7, 2024. There are corresponding patents
granted in Europe and Canada (European Patent No. EP 1644024, and Canadian Patent No. 2528522).

 Stability
Patent Application for Mino-Lok

 In
October 2018, the USPTO issued U.S. Patent No. 10,086,114 (the "114 patent"), entitled "Antimicrobial Solutions with
Enhanced Stability." On October 9, 2019, the European Patent Office ("EPO") granted European Patent No. 3370794, which
corresponds to the '114 patent. The grant of these patents strengthens the intellectual property protection for Mino-Lok through
November 2036. While the original patents for Mino-Lok (discussed above) cover the basic composition, this invention overcomes limitations
in mixing antimicrobial solutions in which components have precipitated because of physical and/or chemical factors, thus limiting the
stability of the post-mix solutions. The scientists and technologists at MDACC have been able to improve the stability of the post-mixed
solutions through adjustments of the post-mixed pH of the solution. This may allow for longer storage time of the ready-to-use solution.
As such, the patents claiming the enhanced stability may effectively extend patent protection for Mino-Lok beyond the 2024 expiration
of the original patents since it is expected that the compositions providing enhanced stability would be preferred over any non-stabilized
versions that a competitor may introduce after June 7, 2024. Citius Pharma holds the exclusive worldwide license which provides access
to this patented technology for development and commercialization of Mino-Lok.

has received a Qualified Infectious Disease Product ("QIDP") designation. The QIDP designation provides New Drug Applications
an additional five years of market exclusivity, which together with the potential three years of exclusivity for the new strength and
formulation of Mino-Lok, would result in a combined total of eight years of market exclusivity regardless of patent protection.

 Halo-Lido

 We
are developing Halo-Lido to have a unique combination of excipients as well as unique concentrations of the active ingredients. The goal
is to have a product that is optimized for stability and activity. Once the formulation development is completed and data is obtained,
we intend to apply for a patent on this new topical formulation.

 We
seek to achieve approval for Halo-Lido by utilizing the FDA's 505(b)(2) pathway. This pathway allows an applicant to file an NDA
that contains full reports of investigations of safety and effectiveness, but where at least some of the information required for approval
comes from prior studies not conducted by or for the applicant and for which the applicant has not obtained a right of reference to such
prior third-party studies. This pathway would provide three years of market exclusivity.

 Mino-Wrap

 In
January 2019, we entered into a patent and technology license agreement with MDACC to develop and commercialize Mino-Wrap on an exclusive
worldwide basis, with no rights to sub-license. We paid a one-time upfront licensing fee upon execution of the agreement. Under the agreement,
we are required to use commercially reasonable efforts to commercialize Mino-Wrap under several regulatory scenarios and achieve milestones
that are associated with these regulatory options leading to an approval from the FDA. We are obligated to pay annual maintenance fees
that increase annually until reaching a designated amount, which we must pay until the first sale of product. We also must pay up to
an aggregate of $2.1 million in milestone payments, depending on the achievement of various regulatory and commercial milestones. Under
the terms of the license agreement, we also must pay a royalty equal to mid- to upper-single digit percentages of net sales, depending
on the level of sales in that year, and subject to downward adjustment to lower- to mid-single digit percentages in the event there is
no valid patent for the product in the U.S. at the time of sale. After the first sale of product, we will owe an annual minimum royalty
payment that will increase annually for the duration of the term. We will be responsible for all patent expenses incurred by MDACC for
the term of the agreement although MDACC is responsible for filing, prosecution and maintenance of all patents.

 The
term of the license agreement will end on the later of the expiration of all licensed patents, or the fifteenth anniversary of the agreement.
MDACC may terminate the license agreement at any time after four years in any country if we have not commercialized or are not actively
attempting to commercialize a product in such country. The license agreement will terminate in the event we breach any of our payment
or reporting obligations or MDACC breaches any of its obligations under the agreement. MDACC will have the right to terminate the agreement
if we bring or participate in an action to challenge MDACC's ownership of any of the licensed patent rights. We may terminate the
license agreement upon 180 days' notice. The license agreement may also be terminated upon our and MDACC's mutual consent.

 In
December 2017, the USPTO issued U.S. Patent No. 9,849,217, entitled "Antimicrobial Wraps for Medical Implants." This invention
overcomes limitations in breast reconstruction utilizing tissue expanders and implants following mastectomies by providing, in certain
aspects, biodegradable antimicrobial film that may be wrapped around a medical implant such as a breast implant prior to the insertion
into a subject such as a human patient. The scientists and technologists at MDACC have developed a biodegradable covering for a medical
implant comprising a highly plasticized gelatin and at least one drug to reduce infection.

 On
November 18, 2021, MDACC filed a provisional patent application entitled "Antimicrobial Wraps for Medical Implants" in which
the manufacturing process of the wrap now incorporates a freeze-drying process to prevent degradation of the active drug.

Pharma holds the exclusive worldwide license, which provides access to this patented technology for development and commercialization
of Mino-Wrap.

 In
October 2020, we, through our subsidiary NoveCite, Inc., entered into a license agreement with Novellus Therapeutics Limited ("Licensor"),
whereby NoveCite acquired an exclusive, worldwide license, with the right to sublicense, to develop and commercialize a stem cell therapy
based on the Licensor's patented technology for the treatment of acute pneumonitis of any etiology in which inflammation is a major
agent in humans. The patented technology consists of mesenchymal stem cells ("MSCs") derived from an induced pluripotent
stem cell line that is made by Licensor using the mRNA cell reprogramming methods in the patents covering the licensed technology.

 Upon
execution of the license agreement, NoveCite paid an upfront payment of $5,000,000 and issued to Licensor shares of NoveCite's
common stock representing 25% of NoveCite's currently outstanding equity. We own the other 75% of NoveCite's currently outstanding
equity.

is obligated to pay Licensor up to an aggregate of $51,000,000 in milestone payments upon the achievement of various regulatory and developmental
milestones. NoveCite also must pay on a fiscal quarter basis a royalty equal to low double-digit percentages of net sales, commencing
upon the first commercial sale of a licensed product. This royalty is subject to downward adjustment on a product-by-product and country-by-country
basis to an upper-single digit percentage of net sales in any country in the event of the expiration of the last valid patent claim or
if no valid patent claim exists in that country. The royalty will end on the earlier of (i) the date on which a biosimilar product is
first marketed, sold, or distributed by Licensor or any third party in the applicable country or (ii) the 10-year anniversary of the
date of expiration of the last-to-expire valid patent claim in that country. In the case of a country where no licensed patent ever exists,
the royalty will end on the later of (i) the date of expiry of such licensed product's regulatory exclusivity and (ii) the 10-year
anniversary of the date of the first commercial sale of the licensed product in the applicable country. In addition, NoveCite will pay
to Licensor an amount equal to a mid-twenties percentage of any sublicensee fees it receives.

the term of the license agreement, NoveCite is required to use commercially reasonable efforts to make commercially available at least
one product in at least two markets: the U.S. and either the United Kingdom, France, Germany, China or Japan. Additionally, NoveCite
shall (i) on or before the five-year anniversary of the date of the license agreement, file an IND for a licensed product in the field
of acute pneumonitis treatment and (ii) receive regulatory approval for a licensed product in the field of acute pneumonitis treatment
in the U.S. or in a major market country on or before the ten-year anniversary of the date of the license agreement.

to the terms of the license agreement, NoveCite has been granted a right of first negotiation to exclusively license the rights to any
new products developed or acquired by Licensor which cannot include MSC's, that may be used within the field of acute pneumonitis
treatment. After receiving notice from the Licensor of the new product opportunity, NoveCite has 30 days to notify Licensor of its desire
to negotiate a license agreement for the new product. If such notice is given by NoveCite, the parties shall then have a period of 150
days from the date of Licensor's notice to NoveCite to negotiate, exclusively and in good faith, the terms and conditions for the
new product license agreement.

 The
term of the license agreement will continue on a country-by-country and licensed product-by-licensed product basis until the expiration
of the last-to-expire royalty term for any and all licensed products unless earlier terminated in accordance with its terms. Either party
may terminate the license agreement upon written notice if the other party is in material default or breach of the agreement, subject
to cure within the designated time periods. Either party also may terminate the license agreement if the other party files for bankruptcy
or takes related actions or is unable to pay its debts as they become due, subject to cure within the designated time period. Additionally,
Licensor will have the right to terminate the agreement if NoveCite directly or indirectly challenges the patentability, enforceability
or validity of any licensed patent. NoveCite may terminate the license agreement at any time without cause upon 90 days prior written
notice.

 Licensor
will be responsible for preparing, filing, prosecuting and maintaining all patent applications and patents included in the licensed patents
in the territory. Provided however, that if Licensor decides that it is not interested in maintaining a particular licensed patent or
in preparing, filing, or prosecuting a licensed patent, it will promptly advise NoveCite in writing and NoveCite will have the right,
but not the obligation, to assume such responsibilities in the territory at NoveCite's sole cost and expense.

the term of the license agreement, Licensor is prohibited from commercializing or exploiting (directly or indirectly) any product that
includes mesenchymal stem cells for any purpose in acute pneumonitis treatment (subject to certain sponsored research exceptions), or
exploiting (directly or indirectly) or enabling a third party to exploit, for any purpose in acute pneumonitis treatment or otherwise,
the original licensed cell banks line or any GMP-grade cell banks of a cell line derived therefrom and that can be used as starting material
for the manufacture of products derived from the licensed technology. During the term of the license agreement, each party is prohibited
from soliciting any employee of the other party, subject to certain exceptions.

 In
July 2021, Novellus was acquired by Brooklyn. Pursuant to this transaction, the NoveCite license was assumed by Brooklyn with all of
its original terms and conditions. In October 2021, Brooklyn changed its name to Eterna Therapeutics Inc.

 We
operate in a highly competitive and regulated industry which is subject to change. We face significant competition from organizations
that are pursuing drugs that would compete with the drug candidates that we are developing and the same or similar products that target
the same conditions we intend to treat. Due to our limited resources, we may not be able to compete successfully against these organizations,
which include many large, well-financed and experienced pharmaceutical and biotechnology companies, as well as academic and research
institutions and government agencies.

 There
are currently several approved targeted therapeutics for patients with persistent or recurrent CTCL. However, there are limitations to
these targeted therapies, which often are discontinued due to toxicity, adverse events, or a limited duration of response due to resistance
over time. Consequently, we believe there continues to be an unmet medical need for patients with CTCL and an opportunity for LYMPHIR
to be included among the treatment armamentarium for advanced-stage CTCL.

 The
following products are approved for the systemic treatment of advanced CTCL:

 Mogamulizumab, sold under
 the brand name Poteligeo, is a humanized, afucosylated monoclonal antibody targeting CC chemokine receptor 4. The FDA approved it
 for treatment of relapsed or refractory mycosis fungoides and S zary disease.

 Brentuximab vedotin, sold
 under the brand name Adcetris, is an antibody-drug conjugate medication used to treat relapsed or refractory Hodgkin lymphoma and
 systemic anaplastic large cell lymphoma, a type of T-cell non-Hodgkin lymphoma. It selectively targets tumor cells expressing the
 CD30 antigen, a defining marker of Hodgkin lymphoma and ALC.

 Romidepsin sold under the
 brand name Istodax, is a histone deacetylase ("HDAC") inhibitor indicated for the treatment of CTCL in adult patients
 who have received at least one prior systemic therapy.

 Vorinostat sold under the
 brand name Zolinza, is a HDAC inhibitor indicated for the treatment of cutaneous manifestations in patients with CTCL who have progressive,
 persistent or recurrent disease on or following two systemic therapies.

 Currently,
the only alternative to Mino-Lok in the treatment of infected CVCs in CRBSI/CLABSI patients of which we are aware, is the standard of
care of removing the culprit CVC and replacing a new CVC at a different vascular site. The Company is not aware of any INDs for a salvage
antibiotic lock solution and does not expect any to be forthcoming due to the difficulty of meeting the necessary criteria to be effective
and practical.

 At
this time, there are no pharmacologic agents approved in the U.S. for the prevention or treatment of CRBSIs or CLABSIs in central venous
catheters. The Company is aware that there are several agents in development for prevention but none for salvage. The most prominent
of these appear to be Defencath from CorMedix Inc. and B-Lock from Great Lakes Pharmaceuticals, Inc. ("GLP"). Neither of
these lock solutions have been shown to be effective in salvaging catheters in bacteremic patients as Mino-Lok is intended to do, and
Citius Pharma does not expect that either would be pursued for this indication.

 Defencath TM
 (CorMedix Inc.)

 Defencath
is a formulation of Taurolidine 1.35%, Citrate 3.5%, and Heparin 1000 units/mL. Neutrolin is an anti-microbial catheter lock solution
being developed by CorMedix to prevent CRBSIs and to prevent clotting. In January 2015, the FDA granted Fast Track and QIDP designations
for Defencath. In December 2015, CorMedix initiated its Phase 3 clinical trial in hemodialysis patients in the U.S. On June 20, 2018,
CorMedix announced that it had completed its review and source-verification of the data required for the interim analysis of the Phase
3 LOCK-IT-100 study for Neutrolin. The data was then locked and transferred to the independent biostatistician for un-blinding and analysis,
who then provided the results to the Data and Safety Monitoring Board ("DSMB") for its review.

 On
July 25, 2018, CorMedix announced that the DSMB had completed its review of the interim analysis of the data from the currently ongoing
Phase 3 LOCK-IT-100 study for Neutrolin. Because the pre-specified level of statistical significance was reached and efficacy had been
demonstrated, the DSMB recommended the study be terminated early. No safety concerns were reported by the DSMB based on the interim analysis.

 CorMedix
submitted its NDA for Defencath to the FDA, which accepted the NDA in August 2020. The FDA set a target review date of February 28, 2021.
In March 2021, CorMedix reported that the FDA, in its Complete Response Letter ("CRL"), informed CorMedix that the FDA could
not approve the NDA for DefenCath in its present form. The FDA noted concerns at the third-party manufacturing facility after a review
of records requested by the FDA and provided by the contract manufacturer ("CMO"). Additionally, the FDA is requiring a manual
extraction study to demonstrate that the labeled volume can be consistently withdrawn from the vials despite an existing in-process control
to demonstrate fill volume within specifications. In April 2021, CorMedix and the CMO met with the FDA to discuss proposed resolutions
for the deficiencies identified in the CRL and the Post-Application Action Letter ("PAAL") received by the CMO from the FDA
for the NDA for DefenCath. There was an agreed upon protocol for the manual extraction study identified in the CRL, which has been successfully
completed. Addressing the FDA's concerns regarding the qualification of the filling operation necessitated adjustments in the process
and generation of additional data on operating parameters for the manufacture of DefenCath. CorMedix and the CMO determined that additional
process qualification is needed with subsequent validation to address these issues. The FDA stated that the review timeline would be
determined when the NDA resubmission is received and that it expected all corrections to facility deficiencies to be complete at the
time of resubmission so that all corrective actions may be verified during an onsite evaluation of the manufacturing facility in the
next review cycle, if the FDA determines it will do an onsite evaluation.

 On
February 28, 2022, CorMedix resubmitted the NDA for DefenCath to address the CRL issued by the FDA. In parallel, CorMedix's third-party
manufacturer submitted responses to the deficiencies identified at the manufacturing facility in the PAAL issued by the FDA concurrently
with the CRL. On March 28, 2022, CorMedix announced that the resubmission of the NDA for DefenCath had been accepted for filing by the
FDA. The FDA considers the resubmission as a complete, Class 2 response with a six-month review cycle. The CMO has notified us that an
onsite inspection by the FDA was conducted that resulted in FORM FDA 483 observations that are being addressed. The CMO submitted responses
to the inspectional observations along with a corrective action plan and requested a meeting with the FDA to discuss. CorMedix also has
been notified by its supplier of heparin, an active pharmaceutical ingredient ("API") for DefenCath, that an inspection by
the FDA for an unrelated API has resulted in a Warning Letter due to deviations from good manufacturing practices for the unrelated API.

 On
August 8, 2022, CorMedix announced receipt of a second CRL from the FDA regarding our DefenCath NDA. The FDA stated that the DefenCath
NDA cannot be approved until deficiencies conveyed to the CMO and the heparin API supplier are resolved to the satisfaction of the FDA.
There were no other requirements identified by the FDA for CorMedix prior to resubmission of the NDA. As part of the NDA review process,
the FDA also notified CorMedix that although the tradename DefenCath was conditionally approved, the FDA now has identified potential
confusion with another pending product name that is also under review. The ultimate acceptability of the proposed tradename is dependent
upon which application is approved first. As a precaution, CorMedix has submitted an alternative proprietary name to the FDA which will
undergo review.

 CorMedix
also announced that it had finalized an agreement with Alcami Corporation ("Alcami"), a U.S. based contract manufacturer
with proven capabilities for manufacturing commercial sterile parenteral drug products. Alcami will function as a manufacturing site
for DefenCath for the U.S. market, and CorMedix expects to be able to submit a supplement to its NDA application around the end of the
first quarter of 2023 to request approval from FDA for DefenCath manufacturing.

 On
November 15, 2023 CorMedix announced that the FDA has approved DefenCath to reduce the incidence of catheter-related bloodstream infections
(CRBSIs) for the limited population of adult patients with kidney failure receiving chronic hemodialysis through a central venous catheter
(CVC).

 B-Lock
(Great Lakes Pharmaceuticals, Inc.)

 B-Lock
is a triple combination of trimethoprim, EDTA and ethanol from Great Lakes Pharmaceuticals, Inc. ("GLP"). On July 24, 2012,
GLP announced the initiation of a clinical study of B-Lock. We are unaware as to the progress or results of these studies. In addition,
we are not aware of any IND being filed in the U.S. for B-Lock, nor are we aware of any clinical studies to support salvage of infected
catheters in bacteremic patients.

 There
has been no further public information available on GLP. GLP's web site and phone number are no longer active and the Company believes
that they have ceased operations.

 Halo-Lido

 The
primary competition in the hemorrhoid market is non-prescription OTC products. If approved by the FDA, Halo-Lido would be the only prescription
product for the treatment of hemorrhoids.

 Mino-Wrap

 The
primary competition for Mino-Wrap would be the existing standard of care treatment, which includes a systemic perioperative antimicrobial
agent with the perioperative immersion of the implant or irrigation of the surgical pocket with an antimicrobial solution prior to insertion
of the tissue expander device. This is also administered with immediate postoperative oral antimicrobials.

 There
are multiple participants in the cell therapy field both in the U.S. and abroad. We believe that the following companies most directly
compete with NoveCite in our licensed field of acute pneumonitis treatment.

 Cynata
Therapeutics Limited develops and commercializes a proprietary mesenchymal stem cell technology under the Cymerus brand for human therapeutic
use in Australia. The company's lead therapeutic product candidate is CYP-001, which has completed a Phase 1 clinical trial for
the treatment of graft versus host disease. Cynata also develops products for the treatment of asthma, heart attack, diabetic wounds,
coronary artery disease, acute respiratory distress syndrome, brain cancer, melanoma, sepsis, osteoarthritis, and critical limb ischemia,
which are in a preclinical model.

 Athersys,
Inc. is a biotechnology company that focuses on the research and development activities in the field of regenerative medicine. Its clinical
development programs are focused on treating neurological conditions, cardiovascular diseases, inflammatory and immune disorders, and
pulmonary and other conditions. The company's lead platform product includes MultiStem cell therapy, an allogeneic stem cell product,
which has an ongoing Phase 2/3 clinical trial for the treatment of ARDS and has an ongoing clinical trial in Japan for the treatment
of RDS. The MultiStem therapy also is in a Phase 3 clinical study for the treatment of patients suffering from neurological damage from
an ischemic stroke, as well as in a Phase 2 clinical study for the treatment of patients with acute myocardial infarction, and has completed
a Phase 1 clinical study for the treatment of patients suffering from leukemia or various other blood-borne cancers. The company has
license and collaboration agreements with Healios K.K. to develop and commercialize MultiStem cell therapy for ischemic stroke, acute
respiratory distress syndrome, and ophthalmological indications, as well as for the treatment of liver, kidney, pancreas, and intestinal
tissue diseases; and the University of Minnesota to develop MultiStem cell therapy platform.

 Pluristem
Therapeutics Inc. operates as a bio-therapeutics company in Israel. It focuses on the research, development, clinical trial, and manufacture
of placental expanded (PLX) based cell therapeutic products and related technologies for the treatment of various ischemic, inflammatory,
and hematologic conditions, as well as autoimmune disorders. A Phase 2 study of PLX cells as a treatment for severe COVID-19 cases complicated
by acute respiratory distress syndrome has been initiated in the U.S. as well as in Europe and Israel.

 Mesoblast
Limited is a biopharmaceutical company that develops and commercializes allogeneic cellular medicines. The company offers products in
the areas of cardiovascular, spine orthopedic disorder, oncology, hematology, and immune-mediated and inflammatory diseases. Its proprietary
regenerative medicine technology platform is based on specialized cells known as mesenchymal lineage adult stem cells. In April 2020,
Mesoblast initiated a Phase 3 trial using mesenchymal stromal cells for the treatment of moderate to severe COVID-19 acute respiratory
distress syndrome. The trial was halted in December 2020 after the Data Safety Monitoring Board (DSMB) performed a third interim analysis
on the trial's first 180 patients, noting that the trial was not likely to meet the 30-day mortality reduction endpoint at the
planned 300 patient enrolment. The trial was powered to achieve a primary endpoint of 43% reduction in mortality at 30 days for treatment
with remestemcelL on top of maximal care. The DSMB recommended that the trial complete with the enrolled 222 patients, and that all be
followed-up as planned. At follow-up through day 60, remestemcel-L showed a positive but non-significant trend in overall mortality reduction
across the entire population of treated patients (n=217). In the pre-specified population of patients under age 65 (n=123), remestemcel-L
reduced mortality through day 60 by 46%, but not in patients 65 or older (n=94). In an exploratory analysis through day 60, remestemcelL
reduced mortality by 75% and increased days alive off mechanical ventilation in patients under age 65 when combined with dexamethasone,
in comparison with controls on dexamethasone.

 Supply
and Manufacturing

 We
do not currently have and we do not intend to set up our own manufacturing facilities. We expect to use approved contract manufacturers
for manufacturing our product candidates in all stages of development after we file for FDA approval. Each of our domestic and foreign
contract manufacturing establishments, including any contract manufacturers we may decide to use, must be listed in the NDA or the BLA,
as applicable, and must be registered with the FDA. Also, the FDA imposes substantial annual fees on manufacturers of branded products.

 In
general, our suppliers purchase raw materials and supplies on the open market. Substantially all such materials are obtainable from a
number of sources so that the loss of any one source of supply would not have a material adverse effect on us.

 If
we elect to conduct product development and manufacturing, we will be subject to regulation under various federal and state laws, including
the Food, Drug and Cosmetic Act, Occupational Safety and Health Act, the Environmental Protection Act, the Toxic Substances Control Act,
the Resource Conservation and Recovery Act, the Controlled Substances Act and other present and potential future federal, state or local
regulations.

 We
have contracted with proven suppliers and manufacturers for active pharmaceutical ingredient, development and packaging. We are confident
that all materials meet or will meet specifications discussed at the chemistry, manufacturing and controls meeting with the FDA.

 Supply
and Manufacturing of LYMPHIR

 We
have either contracted directly or contracted through Citius Oncology, to secure supply agreements with third-party cGMP facilities who
are in compliance with current good manufacturing practices as generally accepted by the FDA. We are confident that all drug substance
and drug product materials meet or will meet specifications as agreed with the FDA.

 We
believe our contract manufacturers have sufficient capacity to support demand for our products as our business grows. In addition to
our supply agreements with third-party manufacturers, we, through Citius Oncology, have contracted with other proven suppliers for, testing,
labeling, packaging, and distribution of LYMPHIR.

 Regulation

 United
States Government Regulation

 The
research, development, testing, manufacture, labeling, promotion, advertising, distribution and marketing, among other things, of our
product candidates are extensively regulated by governmental authorities in the U.S. and other countries. All of our current product
candidates are considered drugs. Consequently, we plan to resubmit the BLA for LYMPHIR early in the first quarter of 2024 and, depending
on the results of our preclinical and clinical trials, we intend to submit an NDA to the FDA for each of Mino-Lok, Halo-Lido, Mino-Wrap
and a BLA to the FDA for NoveCite.

 In
the U.S., the FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act and the agency's implementing regulations. If
we fail to comply with the applicable U.S. requirements at any time during the product development process, including clinical testing,
as well as at any time before and after the approval process, we may become subject to administrative or judicial sanctions. These sanctions
could include the FDA's refusal to approve pending applications, license suspension or revocation, withdrawal of an approval, warning
letters, adverse publicity, product recalls, product seizures, total or partial suspension of production or distribution, injunctions,
fines, civil penalties or criminal prosecution. Any agency enforcement action could have a material adverse effect on our company and
its operations.

 Before
any one of our drug product candidates may be marketed in the U.S., it must be approved by the FDA. The steps required before a drug
may be approved for marketing in the U.S. generally include:

 preclinical laboratory
 and animal tests, and formulation studies;

 the submission to the FDA
 of an IND application for human clinical testing that must become effective before human clinical trials may begin;

 adequate and well-controlled
 human clinical trials to establish the safety and efficacy of the product candidate for each indication for which approval is sought;

 the submission to the FDA
 of an NDA or a BLA and the FDA's acceptance of the NDA or BLA for filing;

 satisfactory completion
 of an FDA inspection of the manufacturing facilities at which the product is to be produced to assess compliance with the FDA's
 current Good Manufacturing Practices ("cGMP"); and

 FDA review and approval
 of the NDA or BLA.

 Foreign
Regulation

 We
and any of our collaborative partners may be subject to widely varying foreign regulations, which may be different from those of the
FDA, governing clinical trials, manufacture, product registration and approval and pharmaceutical sales. Whether or not FDA approval
has been obtained, we or our collaboration partners must obtain a separate approval for a product by the comparable regulatory authorities
of foreign countries prior to the commencement of product marketing in such countries. In certain countries, regulatory authorities also
establish pricing and reimbursement criteria. The approval process varies from country to country, and the time may be longer or shorter
than that required for FDA approval. In addition, under current U.S. law, there are restrictions on the export of products not approved
by the FDA, depending on the country involved and the status of the product in that country.

 Employees

 As
of September 30, 2023, we had 22 employees and various consultants providing support. Through our consulting and collaboration arrangements,
and including our Scientific Advisory Board, we have access to more than 30 additional professionals, who possess significant expertise
in business development, legal, accounting, regulatory affairs, clinical operations, and manufacturing. We also rely upon a network of
consultants to support our clinical studies and manufacturing efforts.

 Executive
Officers of Citius Pharma

 Leonard
Mazur, Chief Executive Officer, Chairman and Secretary – Mr. Mazur, 78, was appointed Chief Executive Officer effective
May 1, 2022, and has been a member of the Board since September 2014. Mr. Mazur previously served as Chief Executive Officer, President,
and Chief Operating Officer from September 2014 until March 2016.

 Myron
Holubiak, Executive Vice Chairman and Director – Mr. Holubiak, 76, was appointed Executive Vice Chairman effective May
1, 2022, and has been a member of the Board since October 2015. He previously served as President and Chief Executive Officer from March
2016 through April 2022. He was also the founder and Chief Executive Officer and President of Leonard-Meron Biosciences, Inc., an acquired
subsidiary of Citius Pharma, from March 2013 until March 2016.

 Jaime
Bartushak, Chief Business Officer, Chief Financial Officer and Principal Financial Officer – Mr. Bartushak, 56, was appointed
as Chief Financial Officer in November 2017. Previously, he was one of the founders and Chief Financial Officer of Leonard-Meron Biosciences,
Inc., an acquired subsidiary of Citius Pharma.

 Myron
Czuczman, Chief Medical Officer and Executive Vice President – Dr. Czuczman, 64, was appointed as Chief Medical Officer
and Executive Vice President in July 2020. Dr. Czuczman previously served as Vice President, Global Clinical Research and Development,
Therapeutic Head of Lymphoma/CLL at Celgene Corporation.

 Other
Information

 We
make available, free of charge through our website, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on
Form 8-K and all amendments to those reports as soon as is reasonably practicable after such material is electronically filed with or
furnished to the SEC pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act").
The SEC maintains an Internet site that contains these reports at www.sec.gov.

 Our
website address is  The information contained in, or that can be accessed through, our website is
not part of this report.

 Item
1A. Risk Factors

 This
report contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those
discussed in this report. Factors that could cause or contribute to these differences include, but are not limited to, those discussed
below and elsewhere in this report.

 If
any of the following risks, or other risks not presently known to us or that we currently believe to not be significant, develop into
actual events, then our business, financial condition, results of operations or prospects could be materially adversely affected. If
that happens, the market price of our securities could decline, and stockholders may lose all or part of their investment.

 Risks
Related to Our Business and our Industry

 We
have a history of net losses and expect to incur losses for the foreseeable future. We may never generate revenues or, if we are able
to generate revenues, achieve profitability.

 We
were formed in 2007 and since our inception have incurred a net loss in each of our previous operating years. Our ability to become profitable
depends upon our ability to obtain marketing approval for and generate revenues from sales of our product candidates. We have been focused
on product development, have not received approval for any of our product candidates, and have not generated any revenues to date. We
have incurred losses in each period of our operations, and we expect to continue to incur losses for the foreseeable future. These losses
are likely to continue to adversely affect our working capital, total assets, and stockholders' equity. The process of developing
our product candidates requires significant clinical development, laboratory testing and clinical trials. In addition, commercialization
of our product candidates will require that we obtain necessary regulatory approvals and establish sales, marketing, and manufacturing
capabilities, either through internal hiring or through contractual relationships with others. We expect to incur substantial losses
for the foreseeable future as a result of anticipated increases in our research and development costs, including costs associated with
conducting preclinical testing and clinical trials, and regulatory compliance activities. We incurred net losses of $32,542,912 and $33,640,646
for the years ended September 30, 2023 and 2022, respectively. At September 30, 2023, we had stockholders' equity of $90,831,108
and an accumulated deficit of $162,231,379. Our net cash used in operating activities was $29,060,212 and $28,361,256 for the years ended
September 30, 2023 and 2022, respectively.

 Our
ability to generate revenues and achieve profitability will depend on numerous factors, including success in:

 developing and testing
 product candidates;

 receiving regulatory approvals
 for our product candidates;

 commercializing our product
 candidates that receive regulatory approval;

 manufacturing commercial
 quantities of our product candidates at acceptable cost levels;

 obtaining medical insurance
 coverage for any approved product candidate; and

 establishing a favorable
 competitive position for any approved product candidates.

 Many
of these factors will depend on circumstances beyond our control. We cannot assure you that any of our product candidates will be approved
by the FDA or any foreign regulatory body or obtain medical insurance coverage, that we will successfully bring any approved product
to market or, if so, that we will ever become profitable.

 Our
independent registered public accounting firm's report includes an explanatory paragraph stating that there is substantial doubt
about our ability to continue as a going concern.

 At
September 30, 2023, we estimated that we have sufficient capital to continue our operations through August 2024. You should not rely
on our consolidated balance sheet as an indication of the amount of proceeds that would be available to satisfy claims of creditors,
and potentially be available for distribution to stockholders, in the event of liquidation.

 The
Company has generated no operating revenue to date and has principally raised capital through the issuance of debt and equity instruments
to finance its operations. However, the Company's continued operations beyond August 2024, including its development plans for
LYMPHIR (through Citius Oncology), Mino-Lok, Halo-Lido, Mino-Wrap and NoveCite, will depend on its ability to obtain regulatory approval
to market LYMPHIR and/or Mino-Lok and generate substantial revenue from the sale of LYMPHIR and/or Mino-Lok and on its ability to raise
additional capital through various potential sources, such as equity and/or debt financings, strategic relationships, or out-licensing
of its product candidates. However, the Company can provide no assurances on the approval, commercialization, or future sales of LYMPHIR
and/or Mino-Lok or that financing or strategic relationships will be available on acceptable terms, or at all. If the Company is unable
to raise sufficient capital, find strategic partners or generate substantial revenue from the sale of LYMPHIR and/or Mino-Lok, there
would be a material adverse effect on its business. Further, the Company expects in the future to incur additional expenses as it continues
to develop its product candidates, including seeking regulatory approval, and protecting its intellectual property.

 Delays
in the resubmission and review of our BLA for LYMPHIR or other factors could increase the cost to develop and launch LYMPHIR.

 While
we believe we have sufficient funds on hand to complete the regulatory development and commercially launch LYMPHIR, delays in our anticipated
submission of the BLA for LYMPHIR, issues raised by the FDA after resubmission or other factors could increase the cost to develop and
launch LYMPHIR, which we expect would require us to obtain additional capital to complete those efforts. Financing might not be available
on acceptable terms or at all.

 We
need to secure additional financing in the future to complete the development of our other current product candidates and support our
operations.

 We
anticipate that we will incur operating losses for the foreseeable future as we continue developing our other product candidates besides
LYMPHIR. The amount and timing of our future funding requirements will depend on many factors, including, but not limited to:

 the rate of progress and
 cost of our trials and other product development and commercialization programs for our current product candidates;

 the costs and timing of
 obtaining licenses for additional product candidates or acquiring other complementary technologies;

 the timing of any regulatory
 approvals of any of our product candidates;

 the costs of establishing
 or contracting for sales, marketing, and distribution capabilities for our product candidates; and

 the status, terms and timing
 of any collaborative, licensing, co-promotion, or other arrangements.

 We
will need to access the capital markets in the future for additional capital for research and development and for operations. As of the
date of this report, we do not anticipate seeking additional capital until sometime in 2024. Traditionally, pharmaceutical companies
have funded their research and development expenditures through raising capital in the equity markets. Declines and uncertainties in
these markets over the past several years have severely restricted raising new capital and have affected companies' abilities to
continue to expand or fund existing research and development efforts. If economic conditions continue to be uncertain or become worse,
our future cost of equity or debt capital and access to the capital markets could be adversely affected. If we are not successful in
securing additional financing, we may be required to significantly delay, reduce the scope of or eliminate one or more of our research
or development programs, downsize our general and administrative infrastructure, or seek alternative measures to avoid insolvency, including
arrangements with collaborative partners or others that may require us to relinquish rights to certain of our technologies or product
candidates.

 We
are primarily a late-stage development company with an unproven business strategy and may never achieve commercialization of our therapeutic
product candidates or profitability.

 We
have no approved products. All of our current product candidates are in the pre-clinical or clinical stage, although we have applied
for approval for LYMPHIR. We rely on third parties to conduct the research and development activities for our product candidates and
our product commercialization capabilities are unproven. We, through Citius Oncology, are in the early stages of developing our sales
and marketing capabilities at this time for LYMPHIR and have contracted with Innovation Partners, a large third-party commercial sales
and marketing organization with an existing commercial infrastructure and product launch experience to assist in our commercial efforts
related to LYMPHIR. We have no sales or marketing capabilities with respect to our other product candidates. Our success will depend
upon our ability to develop such capabilities on our own or to enter into and maintain collaboration agreements on favorable terms and
to select an appropriate commercialization strategy for each product candidate that we choose to pursue and that receives approval, whether
on our own or in collaboration. If we are not successful in implementing our strategy to commercialize our product candidates, we may
never achieve, maintain, or increase profitability. Our ability to successfully commercialize any of our product candidates will depend,
among other things, on our ability to:

 successfully complete pre-clinical
 and clinical trials for our product candidates;

 receive marketing approvals
 from the FDA and similar foreign regulatory authorities for our product candidates;

 establish commercial manufacturing
 arrangements with third-party manufacturers for our product candidates;

 produce, through a validated
 process, sufficiently large quantities of our drug compound(s) to permit successful commercialization of our product candidates;

 build and maintain strong
 sales, distribution, and marketing capabilities sufficient to launch commercial sales of any approved products or establish collaborations
 with third parties for such commercialization;

 secure acceptance of any
 approved products from physicians, health care payers, patients, and the medical community; and

 manage our spending as
 costs and expenses increase due to clinical trials, regulatory applications and development and commercialization activities.

 There
are no guarantees that we will be successful in completing these tasks. If we are unable to successfully complete these tasks, we may
not be able to commercialize any of our product candidates in a timely manner, or at all, in which case we may be unable to generate
sufficient revenues to sustain and grow our business. If we experience unanticipated delays or problems, our development costs could
substantially increase and our business, financial condition and results of operations will be adversely affected.

 We
have a limited operating history upon which to evaluate our ability to successfully commercialize our product candidates.

 We
have two late-stage stage product candidates while our other product candidates are clinical stage. As a result, our success is dependent
upon our ability to obtain regulatory approval for and commercialize our product candidates and we, as a company, have not demonstrated
an ability to perform the functions necessary for the approval or successful commercialization of any product candidates. While various
members of our executive management and key employees have significant prior experience in pharmaceutical development, as a company we
have to date successfully completed only one late-stage clinical trial (much of which had been undertaken by Eisai prior to our in-licensing
of the intellectual property of LYMPHIR) and are just beginning to undertake commercialization activities, in each case for LYMPHIR (through
Citius Oncology). Despite our progress with LYMPHIR, our operations have been limited primarily to business planning, acquiring our proprietary
technology, research and development, recruiting management and technical staff, and raising capital. These operations provide a limited
basis for you to assess our ability to successfully commercialize our product candidates and the advisability of investing in our securities.

 We
may choose not to continue developing any of our product candidates at any time during development, which would reduce or eliminate our
potential return on investment for those product candidates.

 At
any time, we may decide to discontinue the development of any of our product candidates for a variety of reasons, including inadequate
financial resources, the appearance of new technologies that render our product candidates obsolete, competition from a competing product
or changes in or failure to comply with applicable regulatory requirements. If we terminate a program in which we have invested significant
resources, we will not receive any return on our investment and we will have missed the opportunity to allocate those resources to potentially
more productive uses.

 As
an example, on July 1, 2016, we announced that we were discontinuing the development of Suprenza, which was our first commercial product
candidate, for strategic reasons and not due to safety or regulatory concerns, in order to focus our management and cash resources on
the Phase 3 development of Mino-Lok and the Phase 2b development of Halo-Lido. The resources expended on Suprenza therefore did not provide
us any benefit.

 We
face significant risks in our product candidate development efforts.

 Our
business depends on the successful development and commercialization of our product candidates. We are not permitted to market any of
our product candidates in the U.S. until we receive approval from the FDA, or in any foreign jurisdiction until we receive the requisite
approvals from such jurisdiction. The process of developing new drugs and/or therapeutic products is inherently complex, unpredictable,
time-consuming, expensive and uncertain. We must make long-term investments and commit significant resources before knowing whether our
development programs will result in products that will receive regulatory approval and achieve market acceptance. Product candidates
that appear to be promising at some or all stages of development may not receive approval or reach the market for a number of reasons
that may not be predictable based on results and data of the clinical program. Product candidates may be found ineffective or may cause
harmful side effects during clinical trials, may take longer to progress through clinical trials than had been anticipated, may not be
able to achieve the pre-defined clinical endpoints due to statistical anomalies even though clinical benefit may have been achieved,
may fail to receive necessary regulatory approvals, may prove impracticable to manufacture in commercial quantities at reasonable cost
and with acceptable quality, or may fail to achieve market acceptance.

 We
cannot predict whether or when we will obtain regulatory approval to commercialize our product candidates that are under development
and we cannot, therefore, predict the timing of any future revenues from these product candidates, if any. As an example, in response
to the submission of our BLA for LYMPHIR, the FDA issued a complete response letter ("CRL") on July 28, 2023. The FDA is
requiring us to incorporate enhanced product testing and additional controls agreed to with the FDA during the market application review.
There were no concerns relating to the safety and efficacy clinical data package submitted with the BLA, or the proposed prescribing
information. In September 2023, we announced that the FDA has agreed with our plans to address the requirements outlined in the CRL,
which guidance has provided us with a path for completing the necessary activities to support the resubmission of the BLA for LYMPHIR.

 The
FDA has substantial discretion in the drug approval process, including the ability to delay, limit or deny approval of a product candidate
for many reasons. For example, the FDA:

 may
 not find the data from clinical trials, including from our Phase 3 trial for LYMPHIR, sufficient to support the submission of an
 NDA or BLA or to obtain marketing approval in the U.S., including any findings that the clinical and other benefits of our product
 candidates outweigh their safety risks;

 could determine that the
 information provided by us was inadequate, contained clinical deficiencies or otherwise failed to demonstrate the safety and effectiveness
 of any of our product candidates for any indication;

 may
 disagree with our trial design or our interpretation of data from preclinical studies or clinical trials, or may change the requirements
 for approval even after it has reviewed and commented on the design for our trials;

 could determine that we
 cannot rely on Section 505(b)(2) for Mino-Lok or Halo-Lido or any future product candidate whose composition includes components
 previously approved by the FDA;

 may determine that we have
 identified the wrong reference listed drug or drugs or that approval of a Section 505(b)(2) application for any of our product candidates
 is blocked by patent or non-patent exclusivity of the reference listed drug or drugs;

 may identify deficiencies
 in the manufacturing processes or facilities of third-party manufacturers with which we enter into agreements for the manufacture
 of our product candidates;

 may approve our product
 candidates for fewer or more limited indications than we request, or may grant approval contingent on the performance of costly post-approval
 clinical trials;

 may change its approval
 policies or adopt new regulations that could adversely impact our product candidate development programs; or

 may not approve the labeling
 claims that we believe are necessary or desirable for the successful commercialization of our product candidates, or may require
 labeling claims that impair the potential market acceptance of our product candidates.

 These
same risks are generally applicable to the regulatory process in foreign countries. Any failure to obtain regulatory approval of our
product candidates would significantly limit our ability to generate revenues, and any failure to obtain such approval for all of the
indications and labeling claims we deem desirable could reduce our potential revenues.

 We,
through Citius Oncology, may be required to make milestone payments to the licensor and former licensee of the LYMPHIR intellectual property
in connection with its development and commercialization of LYMPHIR, which could adversely affect the profitability of LYMPHIR, if approved.

 Under
the terms of the License Agreement with Eisai, we, through Citius Oncology, are required to pay Eisai a $6 million development milestone
payment upon initial approval by the FDA of LYMPHIR for the CTCL indication (which increases to $7 million in the event Citius Oncology
exercises the option to add India to the licensed territory prior to FDA approval) and an aggregate of up to $22 million related to the
achievement of net product sales thresholds. Under the terms of the agreement with Dr. Reddy's, Citius Oncology is obligated to
pay up to an aggregate of $40 million related to CTCL approvals in the U.S. and other markets, up to $70 million in development milestones
for additional indications, and up to $300 million for commercial sales milestones. Further, under the agreement with Dr. Reddy's,
Citius Oncology is required to (i) use commercially reasonable efforts to make commercially available products in the CTCL indication,
peripheral T-cell lymphoma indication and immuno-oncology indication, (ii) initiate two investigator initiated immuno-oncology trials,
(iii) use commercially reasonable efforts to achieve each of the approval milestones, and (iv) complete each specified immuno-oncology
investigator trial on or before September 1, 2025, the four-year anniversary of the effective date of the definitive agreement. Additionally,
Citius Oncology is required to commercially launch a product in a territory within six months of receiving regulatory approval for such
product in each such jurisdiction.

 These
development and milestone obligations could impose substantial additional costs on us, divert resources from other aspects of the business,
and adversely affect the overall profitability of LYMPHIR, if approved. We, through Citius Oncology, may need to obtain additional financing
to satisfy these milestone payments, and cannot be sure that any additional funding, if needed, will be available on favorable terms,
or at all.

 While
our business strategy generally is to focus on the development of late-stage product candidates to lessen the development risk, there
is still significant risk to successfully developing a product candidate.

 Our
goal in generally pursuing late-stage therapeutic product candidates with what we believe is a promising pre-clinical and early clinical
stage track record is to avoid the risk of failure at the pre-clinical and early clinical stages. However, there is still significant
risk to obtaining regulatory approval and successfully commercializing any late-stage product candidate that we pursue. All of the risks
inherent in drug development of initial stage product candidates also apply to late-stage candidates. We cannot assure you that our business
strategy will be successful.

 The
results of pre-clinical studies and completed clinical trials are not necessarily predictive of future results, and our current product
candidates may not have favorable results in later studies or trials.

 Pre-clinical
studies and Phase 1 and Phase 2 clinical trials are not primarily designed to test the efficacy of a product candidate in the general
population, but rather to test initial safety, to study pharmacokinetics and pharmacodynamics, to study limited efficacy in a small number
of study patients in a selected disease population, and to identify and attempt to understand the product candidate's side effects
at various doses and dosing schedules. Success in pre-clinical studies or completed clinical trials does not ensure that later studies
or trials, including continuing pre-clinical studies and large-scale clinical trials, will be successful nor does it predict future results.
Favorable results in early studies or trials may not be repeated in later studies or trials, and product candidates in later stage trials
may fail to show acceptable safety and efficacy despite having progressed through earlier trials. In addition, the placebo rate in larger
studies may be higher than expected.

 We
may be required to demonstrate through large, long-term outcome trials that our product candidates are safe and effective for use in
a broad population prior to obtaining regulatory approval. This would increase the duration and cost of any such trial.

 There
is typically a high rate of attrition from the failure of product candidates proceeding through clinical trials. In addition, certain
subjects in our clinical trials may respond positively to placebo treatment - these subjects are commonly known as "placebo responders"
- making it more difficult to demonstrate efficacy of the trial drug compared to placebo. This effect is likely to be observed in the
treatment of hemorrhoids, which could negatively impact the development program for Halo-Lido.

 If
any of our product candidates fail to demonstrate sufficient safety and efficacy in any clinical trial, we will experience potentially
significant delays and cost increases in, or may decide to abandon development of, that product candidate. If we abandon or are delayed,
or experience increased costs, in our development efforts related to any of our product candidates, we may not have sufficient resources
to continue or complete development of that product candidate or any other product candidates. We may not be able to continue our operations
and clinical studies, or generate any revenue or become profitable. Our reputation in the industry and in the investment community would
likely be significantly damaged. Further, it might not be possible for us to raise funds in the public or private markets, and our stock
price would likely decrease significantly.

 If
the planned Business Combination is not completed, our common stock could be adversely affected.

 If
the planned Business Combination is not completed for whatever reason, the price of our common stock could be adversely impacted if investors
view the Business Combination as providing more value to both Citius Pharma and Citius Oncology on a standalone basis. Further, depending
on the reason for an inability to complete the Business Combination, our business reputation could be impaired.

 If
we are unable to file for approval of Mino-Lok or Halo-Lido under Section 505(b)(2) of the Federal Food, Drug and Cosmetic Act, or if
we are required to generate additional data related to safety and efficacy in order to obtain approval of Mino-Lok or Halo-Lido under
Section 505(b)(2), we may be unable to meet our anticipated development and commercialization timelines.

 Our
current plans for filing NDAs or BLAs for our product candidates include efforts to minimize the data we will be required to generate
in order to obtain marketing approval for certain of our product candidates and therefore possibly reduce the time and cost of development
of a product candidate and obtain a shortened review period for the application. The timeline for filing and review of our planned NDA
for each of Mino-Lok and Halo-Lido is based upon our plan to submit each such NDA under Section 505(b)(2) of the Federal Food, Drug and
Cosmetic Act, wherein we will rely in part on data generated by third parties and that is in the public domain or elsewhere. Depending
on the data that may be required by the FDA for approval, some of the data may be related to products already approved by the FDA. If
the data relied upon is related to products already approved by the FDA and covered by third-party patents, we would be required to certify
that we do not infringe the listed patents or that such patents are invalid or unenforceable. As a result of the certification, the third
party would have 45 days from notification of our certification to initiate an action against us. In the event that an action is brought
in response to such a certification, the approval of our NDA could be subject to a stay of up to 30 months or more while we defend against
such a suit. Approval of any product candidate under Section 505(b)(2) may therefore be delayed until patent exclusivity expires or until
we successfully challenge the applicability of those patents applicable to our product candidates. Alternatively, we may elect to generate
sufficient additional clinical data so that we no longer rely on data which triggers a potential stay of the approval of any product
candidate. Even if no exclusivity periods apply to an application under Section 505(b)(2), the FDA has broad discretion to require us
to generate additional data on the safety and efficacy of our product candidates to supplement third-party data on which we may be permitted
to rely. In either event, we could be required, before obtaining marketing approval for such product candidate, to conduct substantial
new research and development activities beyond those in which we currently plan to engage in order to obtain approval of that product
candidate. Such additional new research and development activities would be costly and time consuming.

 We
may not be able to obtain shortened review of our applications where available, and in any event the FDA may not agree that any of our
product candidates qualify for marketing approval. If we are required to generate additional data to support approval, we may be unable
to meet our anticipated development and commercialization timelines, may be unable to generate the additional data at a reasonable cost,
or at all, and may be unable to obtain marketing approval of that product candidate. In addition, notwithstanding the approval of many
products by the FDA pursuant to Section 505(b)(2), over the last few years, some pharmaceutical companies and others have objected to
the FDA's interpretation of Section 505(b)(2). If the FDA changes its interpretation of Section 505(b)(2), or if the FDA's
interpretation is successfully challenged in court, this could delay or even prevent the FDA from approving any Section 505(b)(2) application
that we submit.

 Two
of our product candidates, Mino-Lok and Halo-Lido, are combination products consisting of components that have each been separately approved
by the FDA for other indications and which are commercially available and marketed by other companies. Our approval under Section 505(b)(2),
if received, would not preclude physicians, pharmacists, and patients from obtaining individual drug products and titrating the dosage
of these drug products as close to our approved dose as possible.

 Our
Mino-Lok solution contains minocycline, disodium ethylenediaminetetraacetic acid (edetate), and ethyl alcohol, all of which have been
separately approved by the FDA for other indications or are used as excipients in other parenteral products. Assuming FDA approval as
a branded pharmaceutical product, we would need to obtain hospital formulary acceptance to generate sales of Mino-Lok. Additionally,
we may encounter reluctance by the infectious disease physician community to vary from the existing standard of care to remove and replace
an infected catheter. Currently, hospitals are reimbursed for the treatment of CRBSIs by the Center for Medicare and Medicare Services
("CMS") through a Diagnosis Related Group ("DRG") classification or code. Commercial insurance plans reimburse
for CRBSIs in a similar manner. With Mino-Lok being priced as a branded FDA-approved pharmaceutical product, this could result in the
participating hospital retaining a lower share of CMS or commercial reimbursement which may impact the acceptance and use of Mino-Lok
by these institutions.

 Our
Halo-Lido product candidate for the treatment of hemorrhoids is a combination product consisting of two drugs, halobetasol propionate,
a corticosteroid, and lidocaine, that have each been separately approved by the FDA for other indications and which are commercially
available and marketed by other companies. Halobetasol propionate cream is available in a 0.05% strength, and lidocaine creams are also
available in strengths up to 5%. From our market analysis and discussions with a limited number of physicians, we know that patients
sometimes obtain two separate cream products and co-administer them as prescribed, giving them a combination treatment that could be
very similar to what we intend to study and seek approval for. As a branded, FDA-approved product with safety and efficacy data, we intend
to price our product substantially higher than the generically available individual creams. We will then have to convince third-party
payers and pharmacy benefit managers of the advantages of our product and justify our premium pricing. We may encounter resistance from
these entities and will then be dependent on patients' willingness to pay the premium and not seek alternatives. In addition, pharmacists
often suggest lower cost prescription treatment alternatives to both physicians and patients. If approved, our Section 505(b)(2) approval
and the market exclusivity we may receive will not guarantee that such alternatives will not exist, that substitution will not occur,
or that there will be immediate or any acceptance to our pricing by payer formularies.

 Any
fast track designation or grant of priority review status by the FDA may not actually lead to a faster development or regulatory review
or approval process, nor will it assure FDA approval of our product candidates. Additionally, our product candidates may treat indications
that do not qualify for priority review vouchers.

 We
have received fast track designation for Mino-Lok to treat and salvage infected central venous catheters in patients with CRBSIs. We
may seek fast track designation for some of our other product candidates or priority review of applications for approval of our product
candidates for certain indications. If a drug is intended for the treatment of a serious or life-threatening condition and the drug demonstrates
the potential to address unmet medical needs for this condition, the drug sponsor may apply for the FDA fast track designation. If a
product candidate offers major advances in treatment, the FDA may designate it eligible for priority review. The FDA has broad discretion
whether or not to grant these designations, so even if we believe a particular product candidate is eligible for these designations,
we cannot assure you that the FDA would decide to grant them. Even with the fast track designation for Mino-Lok and if we do receive
fast track designation or priority review for any other product candidate, we may not experience a faster development process, review
or approval compared to conventional FDA procedures. The FDA may withdraw fast track designation from Mino-Lok or any other product candidate
to be so designated if it believes that the designation is no longer supported by data from our clinical development program.

 We
do not own NoveCite, Inc. outright and will share any benefits from the development of its NoveCite product candidate with the other
stockholder.

 As
of September 30, 2023, we owned 75% of the outstanding common stock of NoveCite. As a result, we will only be entitled to a portion of
any benefits that flow from the development by NoveCite of its NoveCite product candidate or any other product candidates that it might
develop. In the event that NoveCite issues additional equity securities in the future this would likely reduce our percentage ownership,
which would further reduce the portion of any benefit that might be derived from the NoveCite drug candidate's successful development,
unless we were to increase our investment.

 Any
FDA programs related to the development and approval of treatments for COVID-19 and its symptoms may not be available to us or actually
lead to a faster development or regulatory review or approval process for NoveCite, our proposed treatment for ARDS, nor will it assure
FDA approval of such a treatment.

 In
late April 2020, we made a pre-IND submission to the FDA for NoveCite as a treatment for ARDS. The submission was made under the FDA's
Coronavirus Treatment Acceleration Program ("CTAP") and we requested the FDA's feedback to support the most expeditious
pathway for clinical development of the therapy. The CTAP program is relatively new and the FDA has broad discretion in administering
the CTAP program and therefore we cannot assure you what the FDA might decide and whether there would be a faster development process.

 Because
our NoveCite product candidate is based on novel technologies, it is difficult to predict the regulatory approval process and the time,
the cost and our ability to successfully initiate, conduct and complete clinical development, and obtain the necessary regulatory and
reimbursement approvals, required for commercialization of our NoveCite product candidate.

 NoveCite's
cell programming technology and platform for generating cell therapy products using allogenic mesenchymal stem cells derived from iPSCs
represent novel therapeutic approaches, and to our knowledge there are currently no iPSC-derived cell products approved anywhere in the
world for commercial sale. As such, it is difficult to accurately predict the type and scope of challenges that NoveCite may incur during
development of its NoveCite product candidate, and it faces uncertainties associated with the preclinical and clinical development, manufacture
and regulatory requirements for the initiation and conduct of clinical trials, regulatory approval, and reimbursement required for successful
commercialization of its NoveCite product candidate. In addition, because NoveCite's iPSC-derived cell product candidate is in
the pre-clinical stage, NoveCite is currently assessing safety in humans and has not yet been able to assess the long-term effects of
treatment. Animal models and assays may not accurately predict the safety and efficacy of our product candidate in our target patient
populations, and appropriate models and assays may not exist for demonstrating the safety and purity of the NoveCite product candidate,
as required by the FDA and other regulatory authorities for ongoing clinical development and regulatory approval.

 The
pre-clinical and clinical development, manufacture, and regulatory requirements for approval of the NoveCite product candidate may be
more expensive and take longer than for other more well-known or extensively studied pharmaceutical or biopharmaceutical product candidates
due to a lack of prior experiences on the side of both developers and regulatory agencies. Additionally, due to the uncertainties associated
with the pre-clinical and clinical development, manufacture, and regulatory requirements for approval of the NoveCite product candidate,
NoveCite may be required to modify or change its pre-clinical and clinical development plans or its manufacturing activities and plans
or be required to meet stricter regulatory requirements for approval. Any such modifications or changes could delay or prevent NoveCite's
ability to develop, manufacture, obtain regulatory approval for or commercialize its NoveCite product candidate, which would adversely
affect NoveCite's and our business, financial condition and results of operations.

 Cellular
immunotherapies, and stem cell therapies and iPSC-derived cell therapies in particular, represent relatively new therapeutic areas, and
the FDA has cautioned consumers about potential safety risks associated with cell therapies. To date, there are relatively few approved
cell therapies. As a result, the regulatory approval process for a product candidate such as NoveCite is uncertain and may be more expensive
and take longer than the approval process for product candidates based on other, better known or more extensively studied technologies
and therapeutic approaches. For example, there are currently no FDA approved products with a label designation that supports the use
of a product to treat and reduce the severity of ARDS in patients with COVID-19, which makes it difficult to determine the clinical endpoints
and data required to support an application or regulatory approval, and the time and cost required to obtain regulatory approval in the
U.S. for our product candidate.

 Regulatory
requirements in the U.S. governing cell therapy products have changed frequently and the FDA or other regulatory bodies may change the
requirements, or identify different regulatory pathways, for approval of the NoveCite product candidate. For example, within the FDA,
the Center for Biologics Evaluation and Research ("CBER") restructured and created a new Office of Tissues and Advanced Therapies
to better align its oversight activities with FDA Centers for Drugs and Medical Devices. It is possible that over time new or different
divisions may be established or be granted the responsibility for regulating cell and/or gene therapy products, including iPSC-derived
cell products, such as the NoveCite product candidate. As a result, NoveCite may be required to change its regulatory strategy or to
modify its applications for regulatory approval, which could delay and impair its ability to complete the pre-clinical and clinical development
and manufacture of, and obtain regulatory approval for, its NoveCite product candidate. Changes in regulatory authorities and advisory
groups, or any new requirements or guidelines they promulgate, may lengthen the regulatory review process, require NoveCite to perform
additional studies, increase its development and manufacturing costs, lead to changes in regulatory pathways, positions and interpretations,
delay or prevent approval and commercialization of the NoveCite product candidate or lead to significant post-approval limitations or
restrictions. As NoveCite advances its NoveCite product candidate, NoveCite will be required to consult with the FDA and other regulatory
authorities, and its NoveCite product candidate will likely be reviewed by an FDA advisory committee. NoveCite also must comply with
applicable requirements, and if it fails to do so, it may be required to delay or discontinue development of its NoveCite product candidate.
Delays or unexpected costs in obtaining, or the failure to obtain, the regulatory approval necessary to bring the NoveCite product candidate
to market could impair NoveCite's and our ability to generate sufficient product revenues to maintain our respective businesses.

has assumed that the biological capabilities of iPSCs and adult-donor derived cells are likely to be comparable. If it is discovered
that this assumption is incorrect, the NoveCite product candidate research and development activities could be harmed.

anticipates that its research and development for its NoveCite product candidate will involve iPSCs, rather than adult-donor derived
cells. With respect to iPSCs, NoveCite believes that scientists are still somewhat uncertain about the clinical utility, life span, and
safety of such cells, and whether such cells differ in any clinically significant ways from adult-donor derived cells. If NoveCite discovers
that iPSCs will not be useful for whatever reason for its NoveCite product candidate program, this would negatively affect NoveCite's
ability to develop a marketable product and it and we may never become profitable, which would have an adverse effect on our respective
businesses, prospects, financial condition and results of operations.

 Even
if we receive regulatory approval to commercialize a product candidate, that product may not gain market acceptance among physicians,
patients, healthcare payers or the medical community and may not generate significant revenue.

 Even
if one of our product candidates obtains regulatory approval, that product may not gain market acceptance among physicians, patients,
healthcare payers or the medical community. The indication may be limited to a subset of the population or we may implement a distribution
system and patient access program that is limited. Coverage and reimbursement of our product candidates by third-party payers, including
government payers, generally is also necessary for commercial success. We believe that the degree of market acceptance and our ability
to generate revenues from any approved product candidate or acquired approved product will depend on a number of factors, including:

 prevalence and severity
 of any side effects;

 results of any post-approval
 studies of the product;

 potential or perceived
 advantages or disadvantages over alternative treatments;

 availability of coverage
 and reimbursement from government and other third-party payers;

 the willingness of patients
 to pay out of pocket in the absence of government or third-party coverage;

 the relative convenience
 and ease of administration and dosing schedule;

 product labeling or product
 insert requirements of the FDA or other regulatory authorities;

 strength of sales, marketing
 and distribution support;

 price of any future products,
 if approved, both in absolute terms and relative to alternative treatments;

 the effectiveness of our
 or any future collaborators' sales and marketing strategies;

 the effect of current and
 future healthcare laws on any approved products;

 patient access programs
 that require patients to provide certain information prior to receiving new and refill prescriptions; and

 requirements for prescribing
 physicians to complete certain educational programs for prescribing drugs.

 If
approved, any product candidate may fail to achieve market acceptance or generate significant revenue to achieve or sustain profitability,
which would harm the Company's business. In addition, our efforts to educate the medical community and third-party payers on the
benefits of any product candidate may require significant resources and may never be successful.

 Even
if approved for marketing by applicable regulatory bodies, we will not be able to create a market for any of our product candidates if
we fail to establish marketing, sales, and distribution capabilities, either on our own or through arrangements with third parties.

 Our
strategy with our product candidates is to outsource to third parties all or most aspects of the product development process, as well
as much of our marketing, sales, and distribution activities. In order to generate sales of any product candidate that receives regulatory
approval, we must either acquire or develop an internal marketing and sales force with technical expertise and with supporting distribution
capabilities or make arrangements with third parties to perform these services for us. Currently, we, through Citius Oncology, are in
the early stages of developing our sales, marketing and distribution capabilities for LYMPHIR and have contracted with Innovation Partners,
a large third-party commercial sales and marketing organization with an existing commercial infrastructure and product launch experience,
to assist in our commercial efforts. We do not have any sales, marketing or distribution capabilities with respect to our other product
candidates. The acquisition or development of a sales and distribution infrastructure requires substantial resources, which may divert
the attention of our management and key personnel and defer our product development efforts. To the extent that we enter into marketing
and sales arrangements with other companies for any product candidates, our revenues will depend on the efforts of others. These efforts
may not be successful. If we fail to develop sales, marketing, and distribution channels, or fail to enter into arrangements with third
parties or the collaboration is terminated or is otherwise unsuccessful, we will experience delays in product launch and sales and incur
increased costs.

 The
FDA and other regulatory agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses.

 If
we are found to have improperly promoted any off-label use of LYMPHIR or any other product candidates, if approved, or if we are found
to have improperly engaged in pre-approval promotion prior to the approval of such product candidates, Citius Pharma may become subject
to significant liability. Such enforcement has become more common in the pharmaceutical industry. The FDA and other regulatory agencies
strictly regulate the promotional claims that may be made about prescription products, such as LYMPHIR and any other product candidates
that might be approved. In particular, a product may not be promoted for uses that are not approved by the FDA or such other regulatory
agencies as reflected in the product's approved labeling. If the Company receives marketing approval for its product candidates
for its proposed indications, physicians may nevertheless use its product for their patients in a manner that is inconsistent with the
approved label, if the physicians believe in their professional medical judgment it could be used in such manner. However, if the Company
is found to have promoted its product for any off-label uses, the federal government could levy civil, criminal and/or administrative
penalties, and seek fines against us. The FDA, Department of Justice or other regulatory authorities could also request that we enter
into a consent decree or a corporate integrity agreement, or seek a permanent injunction against us under which specified promotional
conduct is monitored, changed or curtailed. If we cannot successfully manage the promotion of LYMPHIR or any other product candidates
that receive approval, we could become subject to significant liability, which would materially adversely affect our business, financial
condition and results of operations.

 The
markets in which we operate are highly competitive and we might be unable to compete successfully against new entrants or established
companies.

in the pharmaceutical and medical products industries is intense and is characterized by costly sales and marketing infrastructures,
as well as extensive research efforts and rapid technological progress. We are aware of several pharmaceutical companies also actively
engaged in the development of therapies or products for at least some of the same conditions we are targeting. Many of these companies
have substantially greater research and development capabilities as well as substantially greater marketing, financial and human resources
than we do. In addition, many of these companies have significantly greater experience than us in undertaking pre-clinical testing, clinical
trials and other regulatory approval procedures. Our competitors may develop technologies and products that are more effective than those
we are researching and developing. Such developments could render our product candidates, if approved, less competitive or possibly obsolete.
We are also competing with respect to marketing capabilities and manufacturing efficiency, areas in which we have no current capabilities
and in which we have no experience as a company, although our executive officers do have pharmaceutical commercialization and launch
experience. We, through Citius Oncology, have contracted with Innovation Partners, a large third-party commercial sales and marketing
organization with an existing commercial infrastructure and product launch experience to assist in our commercial efforts for LYMPHIR.
However, our prior experience and our third party arrangements might not translate into the successful development and launch of any
of our product candidates. Mergers, acquisitions, joint ventures and similar events may also significantly increase the competition we
face. In addition, new developments, including the development of other drug technologies and methods of preventing the incidence of
disease, occur in the pharmaceutical and medical technology industries at a rapid pace. These developments may render our product candidates
obsolete or noncompetitive. Compared to us, many of our potential competitors have substantially greater as well as access to strategic
partners and capital resources.

 As
a result of these factors, our competitors may obtain regulatory approval of their products more rapidly than we can or may obtain patent
protection or other intellectual property rights that limit our ability to develop or commercialize our product candidates. Our competitors
might also develop products that are more effective, more useful and less costly than ours and might also be more successful in manufacturing
and marketing their products. In addition, our competitors might be more effective than us in commercializing their products and as a
result, our business and prospects might be materially harmed.

 Physicians
and patients might not accept and use any of our product candidates for which regulatory approval is obtained.

 Even
if the FDA approves one of our product candidates, physicians and patients might not accept and use it. Acceptance and use of our approved
product candidates will depend upon a number of factors, including:

 perceptions by members
 of the health care community, including physicians, about the safety and effectiveness of any of our product candidates;

 perceptions by members
 of the health care community, including physicians, about the use of our product candidates versus the then respective standards
 of care for the disease or problem that we seek to address with our product candidates;

 cost-effectiveness of our
 product candidates relative to competing products or therapies;

 availability of reimbursement
 for our product candidates from government or other healthcare payers; and

 effective marketing and
 distribution efforts by us and/or our licensees and distributors, if any.

 If
any of our current product candidates are approved, we expect their sales to generate substantially all of our revenues for the foreseeable
future, and as a result, the failure of any of these product candidates to find market acceptance would harm our business and would require
us to seek additional financing.

 Our
ability to generate product revenues will be diminished if any of our product candidates that may be approved sell for inadequate prices
or patients are unable to obtain adequate levels of reimbursement.

 Our
ability to commercialize our product candidates, alone or with collaborators, will depend in part on the extent to which reimbursement
will be available from:

 government and health administration
 authorities;

 private health maintenance
 organizations and health insurers; and

 other healthcare payers.

 Significant
uncertainty exists as to the reimbursement status of newly approved healthcare products. Healthcare payers, including Medicare, are challenging
the prices charged for medical products and services. Government and other healthcare payers increasingly attempt to contain healthcare
costs by limiting both coverage and the level of reimbursement for drugs. Even if our product candidates are approved by the FDA, insurance
coverage might not be available, and reimbursement levels might be inadequate, to cover our products. If government and other healthcare
payers do not provide adequate coverage and reimbursement levels for our products, once approved, market acceptance of such products
could be reduced. We cannot predict whether federal or state legislation will be passed that may impact reimbursement policies nor what
the impact of any such legislation would be on the healthcare industry in general or on our business specifically.

 We
are actively engaged with CMS in order to obtain the necessary coverage to facilitate reimbursement for LYMPHIR. However, we can offer
no assurance as to any reimbursement coverage.

 Health
administration authorities in countries other than the U.S. may not provide reimbursement for our products at rates sufficient for us
to achieve profitability, or at all. Like the U.S., these countries have considered health care reform proposals and could materially
alter their government-sponsored health care programs by reducing reimbursement rates. Any reduction in reimbursement rates under Medicare
or foreign health care programs could negatively affect the pricing of our approved product candidates. If we are not able to charge
a sufficient amount for our approved product candidates, then our margins and our profitability will be adversely affected.

 Healthcare
reform measures could hinder or prevent our product candidates' commercial success.

 There
have been, and the Company expects there will continue to be, a number of legislative and regulatory changes to health care systems in
the U.S. and abroad that could impact its ability to sell its products profitably. The U.S. government and other governments have shown
significant interest in pursuing healthcare reform. For example, in 2010, the Patient Protection and Affordable Care Act ("ACA")
was enacted, which substantially changed the way healthcare is financed by both governmental and private insurers in the U.S. Healthcare
reform measures like the ACA may adversely impact the pricing of healthcare products and services in the U.S. or internationally and
the amount of reimbursement available from governmental agencies or other third-party payors.

 Since
its enactment, there have been ongoing efforts to modify the ACA and its implementing regulations. The Company cannot predict what healthcare
reform measures may be enacted by the U.S. Congress or implemented by any administration or how such efforts would impact its business.
Litigation and legislation over the ACA and other healthcare reform measures are likely to continue, with unpredictable and uncertain
results. Further, additional legislative changes to and regulatory changes under or related to the ACA remain possible.

 In
addition, other legislative changes have been proposed and adopted in the U.S. since the ACA was enacted that impact government health
programs. Moreover, payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives. For example,
CMS may develop new payment and delivery models, such as bundled payment models. In addition, recently there has been heightened governmental
scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several U.S. Congressional
inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to drug pricing,
reduce the cost of prescription drugs under government payor programs, and review the relationship between pricing and manufacturer patient
programs. While any proposed measures may require authorization through additional legislation to become effective, the U.S. Congress
and the Biden administration have each indicated that it will continue to seek new legislative and/or administrative measures to control
drug costs. The Company expects that additional U.S. federal healthcare reform measures will be adopted in the future, any of which could
limit the amounts that federal health care programs and commercial payers will pay for healthcare products and services, which could
result in reduced demand for our product candidates, if approved, or additional pricing pressures.

 Individual
states in the U.S. have also increasingly passed legislation and implemented regulations designed to control pharmaceutical and biological
product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing
cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
Legally mandated price controls on payment amounts by third party payors or other restrictions could harm its business, financial condition
and results of operations. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures
to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs.
Furthermore, there has been increased interest by third party payors and governmental authorities in reference pricing systems and publication
of discounts and list prices. These or other reforms could reduce the ultimate demand for our product candidates, if approved, or put
pressure on its product pricing.

 The
Company cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative
action in the U.S. If the Company or any third parties it may engage are slow or unable to adapt to changes in existing requirements
or the adoption of new requirements or policies, or if the Company or such third parties are not able to maintain regulatory compliance,
any approved product candidates may lose any regulatory approval that may have been obtained and we may not achieve or sustain profitability.

 We
are and will be dependent on third-party contract research organizations to conduct all of our clinical trials.

 We
are and will be dependent on third-party research organizations to conduct all of our clinical trials with respect to our product candidates,
including any candidates that we may develop in the future. If we are unable to obtain any necessary testing services on acceptable terms,
we may not complete our product development efforts in a timely or cost-effective manner or at all. If we rely on third parties for human
trials, we may lose some control over these activities and become too dependent upon these parties. These third parties may not complete
testing activities on schedule or when we so request. We may not be able to secure and maintain suitable research organizations to conduct
our human trials. We are responsible for confirming that each of our clinical trials is conducted in accordance with the trial's
general plan and protocol. Moreover, the FDA and foreign regulatory agencies require us to comply with regulations and standards, commonly
referred to as good clinical practices, for conducting, recording, and reporting the results of clinical trials to assure that data and
reported results are credible and accurate and that the trial participants are adequately protected. Our reliance on third parties does
not relieve us of these responsibilities and requirements. If these third parties do not successfully carry out their contractual duties
or regulatory obligations or meet expected deadlines, if the third parties need to be replaced or if the quality or accuracy of the data
they obtain is compromised due to the failure to adhere to our clinical protocols or regulatory requirements or for other reasons, our
preclinical development activities or clinical trials may be extended, delayed, suspended or terminated, and we may not be able to obtain
regulatory approval for any of our product candidates.

 We
rely exclusively on third parties to formulate and manufacture our product candidates.

 We
do not have and do not intend to establish our own manufacturing facilities. Consequently, we lack the physical plant to formulate and
manufacture our product candidates, which are currently being manufactured entirely by commercial third-party manufacturers. We, through
Citius Oncology, have secured supply agreements for LYMPHIR with the two third-party facilities who are in compliance with current good
manufacturing practices ("cGMP") as generally accepted by the FDA. If LYMPHIR, or any other product candidate we develop
or might acquire in the future receives FDA approval, we will rely on one or more third-party contractors to manufacture our products.
If, for any reason, we become unable to rely on our current source or any future source or sources to manufacture our product candidates,
either for pre-clinical or clinical trials or for commercial quantities, then we would need to identify and contract with additional
or replacement third-party manufacturers to manufacture compounds for preclinical, clinical, and commercial purposes. We might not be
successful in identifying additional or replacement third-party manufacturers, or in negotiating acceptable terms with any that we do
identify. If we are unable to secure and maintain third-party manufacturing capacity, the development and sales of our product candidates
and our financial performance might be materially and adversely affected.

 In
addition, before any of our collaborators can begin to commercially manufacture our product candidates, each must obtain regulatory approval
of the manufacturing facility and process. Manufacturing of drugs for clinical and commercial purposes must comply with the FDA's
cGMP and applicable non-U.S. regulatory requirements. The cGMP requirements govern quality control and documentation policies and procedures.
Complying with cGMP and non-U.S. regulatory requirements will require that we expend time, money, and effort in production, recordkeeping,
and quality control to assure that the product meets applicable specifications and other requirements. Our contracted manufacturing facilities
must also pass a pre-approval inspection prior to FDA approval. Failure to pass a pre-approval inspection might significantly delay FDA
approval of our product candidates. If any of our collaborators fails to comply with these requirements, we would be subject to possible
regulatory action which could limit the jurisdictions in which we are permitted to sell our product candidates. As a result, our business,
financial condition, and results of operations might be materially harmed.

 Our
reliance on a limited number of third-party manufacturers exposes us to the following risks:

 We might be unable to identify
 manufacturers for commercial supply on acceptable terms or at all because the number of potential manufacturers is limited and the
 FDA must approve any replacement contractor. This approval would generally require compliance inspections. In addition, a new manufacturer
 would have to be educated in, or develop substantially equivalent processes for, production of our product candidates after receipt
 of FDA approval, if any;

 Our third-party manufacturers
 might be unable to formulate and manufacture our product candidates in the volume and of the quality required to meet our clinical
 and commercial needs, if any;

 Our contract manufacturers
 might not perform as agreed or might not remain in the contract manufacturing business for the time required to supply our clinical
 trials or to successfully produce, store and distribute our product candidates for commercialization;

 Currently, the contract
 manufacturer for our clinical supplies is foreign, which increases the risk of shipping delays, adds the risk of import restrictions,
 and adds the risk of political and environmental uncertainties that might affect those countries;

 Drug manufacturers are
 subject to ongoing periodic unannounced inspection by the FDA and corresponding state agencies to ensure strict compliance with cGMP
 and other government regulations and corresponding foreign standards. We do not have control over third-party manufacturers'
 compliance with these regulations and standards;

 If any third-party manufacturer
 makes improvements in the manufacturing process for our product candidates, we might not own, or might have to share, the intellectual
 property rights to the innovation with our licensors;

 Operations of our third-party
 manufacturers or suppliers could be disrupted by conditions unrelated to our business or operations, including a bankruptcy of the
 manufacturer or supplier or a natural disaster or a pandemic such as COVID-19; and

 We might compete with other
 companies for access to these manufacturers' facilities and might be subject to manufacturing delays if the manufacturers give
 other clients higher priority than us.

 Each
of these risks could delay our clinical trials or the approval, if any, of our product candidates by the FDA or any foreign regulatory
agency or the commercialization of our product candidates and could result in higher costs or deprive us of potential product revenues.
As a result, our business, financial condition, and results of operations might be materially harmed.

 If
we materially breach or default under any of our license agreements, the licensor party to such agreement will have the right to terminate
the license agreement, which termination may materially harm our business.

 Our
commercial success will depend in part on the maintenance of our current and any future license agreements. Our license agreements impose,
and we expect that future license agreements will impose, various diligence, milestone payment, royalty and other obligations on us.
For example, under our current license agreements, we are required to use commercially reasonable diligence to develop and commercialize
a product and to satisfy specified payment obligations for various developmental and regulatory milestones. If we fail to comply with
our obligations under our current license agreements or any future license agreements with any party, or we are subject to a bankruptcy,
the licensor may have the right to terminate the license, in which event we would not be able to market products covered by the license.
Each of our license agreements provides the licensor with a right to terminate the license agreement for our material breach or default
under the agreement, including the failure to make any required milestone or other payments. Should the licensor under any of our license
agreements exercise such a termination right, we would lose our right to the intellectual property under the respective license agreement,
which loss may materially harm our business.

 Any
termination, or breach by, or conflict with our strategic partners could harm our business.

 If
we or any of our current or future collaborators fail to renew or terminate any of our collaboration or license agreements or if either
party fails to satisfy its obligations under any of our collaboration or license agreements or complete them in a timely manner, we could
have difficulty completing the development of any of our product candidates and potentially lose significant sources of revenue, which
could result in an adverse impact on our operations and financial condition as well as volatility in any future revenue. In addition,
our agreements with our collaborators may have provisions that give rise to disputes regarding the rights and obligations of the parties.
These and other possible disagreements could lead to termination of the agreement or delays in collaborative research, development, supply,
or commercialization of our product candidates, or could require or result in litigation or arbitration. Any such conflicts with our
collaborators could reduce our ability to obtain future collaboration agreements and could have a negative impact on our relationship
with existing collaborators, adversely affecting our business and revenues. Finally, any of our collaborations may prove to be unsuccessful.

 We
rely on the significant experience and specialized expertise of our executive management and other key personnel and the loss of any
of our executive management or key personnel or our inability to successfully hire their successors could harm our business.

 Our
performance is substantially dependent on the continued services and on the performance of our executive management and other key personnel,
who have extensive experience and specialized expertise in our business. Our Chief Executive Officer, Leonard Mazur, our Vice Chairman,
Myron Holubiak, and our Chief Medical Officer and Executive Vice President, Myron Czuczman, in particular have significant experience
in the running of pharmaceutical companies and/or drug development itself. This depth of experience is of significant benefit to us,
especially given the small size of our management team and our company, including our subsidiaries. The loss of the services of any of
Mr. Mazur, Mr. Holubiak and Dr. Czuczman as well as any other member of our executive management or any key employees, including those
at NoveCite or Citius Oncology, could harm our ability to attract capital and develop and commercialize our product candidates. Neither
we nor NoveCite and Citius Oncology has key man life insurance policies.

 If
we are unable to retain or hire additional qualified personnel, our ability to grow our business might be harmed.

 We
utilize the services of a clinical management team on a part-time basis to assist us in managing our ongoing Phase 2 and Phase 3 trials
and intend to do so for future preclinical and clinical trials. Pursuant to the shared services agreement with Citius Pharma, Citius
Oncology utilizes the services of Citius Pharma's management team to assist it in managing the clinical and pre-clinical trials.
Following the Business Combination, pursuant to an amended and restated shared services agreement, Citius Oncology will continue to utilize
the services of Citius Pharma employees with expertise in product manufacturing and commercialization for the planned launch of LYMPHIR.
While we believe this will provide us with sufficient staffing for our current and future development efforts, we will need to hire or
contract with additional qualified personnel with expertise in preclinical testing, clinical research and testing, government regulation,
formulation and manufacturing and sales and marketing in connection with the continued development, regulatory approval and commercialization
of our product candidates. We compete for qualified individuals with numerous pharmaceutical and biopharmaceutical companies, universities,
and other research institutions.

 The
Combined Company's board members are anticipated to also be directors of Citius Pharma, and the executive officers are also employees
of Citius Pharma pursuant to the shared services agreement. Citius Oncology expects to rely on these individuals and the other expertise
and personnel made available under the shared services agreement for the foreseeable future.

for qualified directors, officers and employees is intense, and we cannot be certain that our retention of these individuals or any search
for additional such personnel will be successful. Attracting and retaining qualified personnel will be critical to our success. In addition,
we may be unable to attract and retain those qualified officers, directors and members of board committees required to provide for effective
management. If we are unable to attract and retain qualified employees, officers and directors, the management and operation of our business
could be adversely affected.

 We
expect to need to increase the size of our organization to further develop our product candidates, and we may experience difficulties
in managing growth.

 We
will need to manage our anticipated growth and increased operational activity, including as a result of the continuing development of
LYMPHIR and our other product candidates. Our personnel, systems, and facilities currently in place may not be adequate to support this
future growth. Our need to effectively execute our growth strategy will require that we:

 manage our research and
 development activities and our regulatory trials effectively;

 attract and motivate sufficient
 numbers of talented employees or consultants;

 manage our internal development
 efforts effectively while complying with our contractual obligations to licensors, licensees, contractors, collaborators and other
 third parties;

 develop internal sales
 and marketing capabilities or establish collaborations with third parties with such capabilities;

 commercialize our product
 candidates; and

 improve our operational,
 financial and management controls, reporting systems and procedures.

 This
planned future growth could place a strain on our administrative and operational infrastructure and may require our management to divert
a disproportionate amount of its attention away from our day-to-day activities. We may not be able to effectively manage the expansion
of our operations or recruit and train additional qualified personnel, which may result in weaknesses in our infrastructure, and give
rise to operational mistakes, loss of business opportunities, loss of employees and consultants and reduced productivity among remaining
employees and consultants. We may not be able to make improvements to our management information and control systems in an efficient
or timely manner and may discover deficiencies in existing systems and controls. If our management is unable to effectively manage our
expected growth, our expenses may increase more than expected, our ability to generate or increase our revenues could be reduced and
we may not be able to implement our business strategy. Our future financial performance and our ability to compete effectively will depend,
in part, on our ability to effectively manage any future growth.

 We
plan to grow and develop our business through acquisitions of or investment in new or complementary businesses, products or technologies,
and the failure to manage these acquisitions or investments, or the failure to integrate them with our existing business, could have
a material adverse effect on us.

 Our
business strategy is based on the acquisition of additional product candidates. This is evidenced by our in-licensing of NoveCite in
October 2020 and LYMPHIR in September 2021. We might consider opportunities to acquire or invest in other technologies, products and
businesses that might enhance our capabilities or complement our current product candidates. Potential and completed acquisitions and
strategic investments involve numerous risks, including potential problems or issues associated with the following:

 assimilating the acquired
 technologies, products, or business operations;

 maintaining uniform standards,
 procedures, controls, and policies;

 unanticipated costs associated
 with the acquisition or investment;

 diversion of our management's
 attention from our preexisting business;

 maintaining or obtaining
 the necessary regulatory approvals or complying with regulatory standards; and

 adverse effects on existing
 business operations.

 We
have no current commitments with respect to any acquisition or investment in other technologies or businesses. We do not know if we will
identify other suitable acquisitions, whether we will be able to successfully complete any acquisitions, or whether we will be able to
successfully integrate any acquired product, technology or business into our business operations or retain key personnel, suppliers,
or collaborators.

 Our
ability to successfully develop our business through acquisitions including the in-licensing of LYMPHIR, will depend on our ability to
identify, negotiate, complete, and integrate suitable target businesses or technologies and obtain any necessary financing. These efforts
could be expensive and time consuming and might disrupt our ongoing operations. If we are unable to efficiently integrate any acquired
business, technology or product into our business operations, our business and financial condition might be adversely affected.

 Conflicts
of interest may arise from our relationship with NoveCite.

 As
of September 30, 2023, we beneficially owned 75% of the voting power of NoveCite's outstanding common stock; Novellus owns the
other 25%. As a result of our partial ownership, our relationship with NoveCite could give rise to certain conflicts of interest that
could have an impact on our and NoveCite's respective research and development programs, business opportunities, and operations
generally.

 Even though we utilize
 different technologies than NoveCite, we could find ourselves in competition with it for research scientists, financing and other
 resources, licensing, manufacturing, and distribution arrangements.

 NoveCite will engage for
 its own business in research and product development programs, investments, and business ventures, and we will not be entitled to
 participate or to receive an interest in those programs, investments, or business ventures other than to the extent as a stockholder
 in NoveCite. NoveCite will not be obligated to present any particular research and development, investment, or business opportunity
 to us, even if the opportunity would be within the scope of our research and development plans or programs, business objectives,
 or investment policies. These opportunities may include, for example, opportunities to acquire businesses or assets, including but
 not limited to patents and other intellectual property that could be used by us or by NoveCite.

 Each conflict of interest
 will be resolved by our respective boards of directors in keeping with their fiduciary duties and such policies as they may implement
 from time to time.

 There is overlap among
 our board of directors, senior management and research staffs and that of NoveCite. Two of our directors, Myron Holubiak and Leonard
 Mazur, also serve as directors of NoveCite. In addition, Myron Holubiak serves as Chief Executive Officer and Jaime Bartushak serves
 as Chief Financial Officer of both Citius Pharma and NoveCite. These overlapping positions could interfere with the duties owed by
 such individuals to Citius Pharma.

 Risks
Related to Our Regulatory and Legal Environment

 We
might not obtain the necessary U.S. or foreign regulatory approvals to commercialize any product candidates.

 We
cannot assure you that we will receive the approvals necessary to commercialize for sale any product candidates we are currently developing
or that we may acquire or seek to develop in the future. We will need FDA approval to commercialize our product candidates in the U.S.
In order to obtain FDA approval of any product candidate, we must submit to the FDA an NDA or a BLA demonstrating that the product candidate
is safe for humans and effective for its intended use. This demonstration requires significant research, pre-clinical studies, and clinical
trials. Satisfaction of the FDA's regulatory requirements typically takes many years, depends upon the type, complexity and novelty
of the product candidate and requires substantial resources for research, development and testing. We cannot predict whether our research
and clinical approaches will result in products that the FDA considers safe for humans and effective for their indicated uses. The FDA
has substantial discretion in the product approval process and might require us to conduct additional pre-clinical and clinical testing,
perform post-marketing studies or otherwise limit or impose conditions on any additional approvals we obtain. The approval process might
also be delayed by changes in government regulation, future legislation or administrative action or changes in FDA policy that occur
prior to or during our product candidate's regulatory review. Delays in obtaining regulatory approvals might:

 delay commercialization
 of, and our ability to derive product revenues from, our product candidates;

 impose costly procedures
 on us; and

 diminish any competitive
 advantages that we might otherwise enjoy.

 Even
if we comply with all FDA requests, the FDA might ultimately reject one or more of our NDAs or BLAs. Even if we are able to obtain regulatory
approval for a particular product candidate, the approval might limit the indicated medical uses for the product, limit our ability to
promote, sell, and distribute the product, require that we conduct costly post-marketing surveillance, and/or require that we conduct
ongoing post-marketing studies. We cannot be sure that we will ever obtain regulatory clearance for any of our product candidates. Failure
to obtain FDA approval of one or more of our product candidates could severely undermine our business by leaving us without saleable
products, and therefore without any potential sources of revenues, until another product candidate could be developed or obtained and
successfully developed, approved and commercialized. Foreign jurisdictions impose similar regulatory approval processes and we will face
the same risks if we seek foreign approval for any of our product candidates. There is no guarantee that we will ever be able to successfully
develop or acquire any product candidate.

 Following
any regulatory approval of any product candidate, we will be subject to ongoing regulatory obligations and restrictions, which may result
in significant expense and limit our ability to commercialize our other product candidates.

 If
one of our product candidates is approved by the FDA or by a foreign regulatory authority, we will be required to comply with extensive
regulations for product manufacturing, labeling, packaging, adverse event reporting, storage, distribution, advertising, promotion and
record keeping. Regulatory approvals may also be subject to significant limitations on the indicated uses or marketing of the products
or to whom and how we may distribute an approved product. Even if U.S. regulatory approval is obtained, the FDA may still impose significant
restrictions on a product's indicated uses or marketing or impose ongoing requirements for potentially costly post-approval studies.
For example, the label ultimately approved for any of our product candidates, if any, may include restrictions on use. If so, we may
be subject to ongoing regulatory obligations and restrictions, which may result in significant expense and limit our ability to commercialize
that product candidate. The FDA could also require a registry to track the patients utilizing the product or implement a Risk Evaluation
and Mitigation Strategy ("REMS") that could restrict access to the product, which would reduce our revenues and/or increase
our costs. Potentially costly post-marketing clinical studies may be required as a condition of approval to further substantiate safety
or efficacy, or to investigate specific issues of interest to the regulatory authority. Similar risks apply in foreign jurisdictions.

 Manufacturers
of pharmaceutical products and their facilities are subject to continual review and periodic inspections by the FDA and other regulatory
authorities for compliance with cGMP regulations, which include requirements relating to quality control and quality assurance as well
as the corresponding maintenance of records and documentation. Similar regulatory programs exist in foreign jurisdictions. Further, regulatory
agencies must approve these manufacturing facilities before they can be used to manufacture our future approved products, if any, and
these facilities are subject to ongoing regulatory inspections. In addition, regulatory agencies subject a pharmaceutical product, its
manufacturer and the manufacturer's facilities to continual review and inspections. The subsequent discovery of previously unknown
problems with a product, including adverse events of unanticipated severity or frequency, or problems with the facility where the product
is manufactured, may result in restrictions on the marketing of that product, up to and including, withdrawal of the product from the
market. If the manufacturing facilities of our suppliers fail to comply with applicable regulatory requirements, it could result in regulatory
action and additional costs to us. Failure to comply with applicable FDA and other regulatory requirements may, either before or after
product approval, if any, subject our company to administrative or judicially imposed sanctions.

 In
addition, the law or regulatory policies governing pharmaceutical products may change. New statutory requirements may be enacted or additional
regulations may be enacted that could prevent or delay regulatory approval of our product candidates. CMOs and their vendors or suppliers
may also face changes in regulatory requirements from governmental agencies in the U.S. and other countries. We cannot predict the likelihood,
nature, extent or effects of government regulation that may arise from future legislation or administrative action, either in the U.S.
or elsewhere. If we are not able to maintain regulatory compliance, we might not be permitted to market any future approved products
and our business could suffer.

 We
could be forced to pay substantial damage awards if product liability claims that may be brought against us are successful.

 The
use of any of our product candidates in pre-clinical and clinical trials, and the sale of any approved products, may expose us to liability
claims and financial losses resulting from the use or sale of our product candidates. We have obtained limited product liability insurance
coverage for our pre-clinical and clinical trials of $5.0 million per occurrence and in the aggregate, subject to a deductible of $25,000
per bodily injury and property damage occurrence, and a medical expense per person limit of $25,000. There can be no assurance that our
existing insurance coverage will extend to any other product candidates in the future. Any product liability insurance coverage may not
be sufficient to satisfy all liabilities resulting from product liability claims. A successful claim may prevent us from obtaining adequate
product liability insurance in the future on commercially desirable terms, if at all. Even if a claim is not successful, defending such
a claim would be time consuming and expensive, may damage that product's and our reputations in the marketplace, and would likely
divert management's attention, any of which could have a material adverse effect on our Company.

 Risks
Related to Our Intellectual Property

 Our
business depends on protecting our intellectual property.

 Without
the intellectual property rights we have already obtained, as well as the further rights we are also pursuing, our competitors would
have opportunity to take advantage of our research and development efforts to develop competing products. Our success, competitive position,
and future revenues, if any, depend in part on our ability and the abilities of our licensors to obtain and maintain patent protection
for our product candidates, methods, processes and other technologies, to preserve our trade secrets, to prevent third parties from infringing
on our proprietary rights and to operate without infringing the proprietary rights of third parties. We anticipate filing additional
patent applications both in the U.S. and in other countries, as appropriate. However, the patent process is subject to numerous risks
and uncertainties, and there can be no assurance that we will be successful in protecting our product candidates by obtaining and defending
patents. These risks and uncertainties include the following:

 Our patent rights might
 be challenged, invalidated, or circumvented, or otherwise might not provide any competitive advantage;

 Our competitors, many of
 which have substantially greater resources than we do and many of which might make significant investments in competing technologies,
 might seek, or might already have obtained, patents that will limit, interfere with, or eliminate our ability to make, use, and sell
 our product candidates either in the U.S. or in international markets;

 Countries other than the
 U.S. might have less restrictive patent laws than those upheld by U.S. courts, allowing foreign competitors the ability to exploit
 these laws to create, develop, and market competing products; and

 As a matter of public policy
 regarding worldwide health concerns, there might be significant pressure on the U.S. government and other international governmental
 bodies to limit the scope of patent protection both inside and outside the U.S. for product candidates that prove successful.

 In
addition, the USPTO and patent offices in other jurisdictions have often required that patent applications concerning pharmaceutical
and/or biotechnology-related inventions be limited or narrowed substantially to cover only the specific innovations exemplified in the
patent application, thereby limiting the scope of protection against competitive challenges. Thus, even if we or our licensors are able
to obtain patents, the patents might be substantially narrower than anticipated.

 Because
the time period from filing a patent application to the issuance, if ever, of the patent is often more than three years and because any
regulatory approval and marketing for a pharmaceutical product often occurs several years after the related patent application is filed,
the resulting market exclusivity afforded by any patent on our drug candidates and technologies will likely be substantially less than
20 years. For example, the U.S. patent on the original Mino-Lok composition expires in June 2024, and the U.S. patent on the stabilized
Mino-Lok composition expires in November 2036. Since we anticipate significant additional time before FDA approval could be obtained,
the maximum market exclusivity afforded by the statutory term of the currently issued patents would be less than 17 years. In the U.S.,
the European Union and some other jurisdictions, patent term extensions are available for certain delays in either patent office proceedings
or marketing and regulatory approval processes. However, due to the specific requirements for obtaining these extensions, there is no
assurance that our patents will be granted extensions even if we encounter significant delays in patent office proceedings or marketing
and regulatory approval.

 Additionally,
patent law is subject to change and varies among the U.S. and foreign countries. Depending on decisions by the U.S. Congress, the U.S.
federal courts, the USPTO or similar authorities in foreign jurisdictions, the laws and regulations governing patents could change in
unpredictable ways that may weaken our and our licensors' abilities to obtain new patents or to enforce existing patents that we
and our licensors or partners may obtain in the future.

and other intellectual property protection is crucial to the success of our business and prospects, and there is a substantial risk that
such protections will prove inadequate. Our business and prospects will be harmed if these protections prove insufficient.

 We
rely on trade secret protections through confidentiality agreements with our employees and other parties, and the breach of these agreements
could adversely affect our business and prospects.

 We
rely on trade secrets, which we seek to protect, in part, through confidentiality and non-disclosure agreements with our employees, collaborators,
suppliers, and other parties. There can be no assurance that these agreements will not be breached, that we would have adequate remedies
for any such breach or that our trade secrets will not otherwise become known to or independently developed by our competitors. We might
be involved from time to time in litigation to determine the enforceability, scope and validity of our proprietary rights. Any such litigation
could result in substantial cost and divert management's attention from our operations.

 If
we infringe the rights of third parties we might have to forego developing and/or selling any approved products, pay damages, or defend
against litigation.

 If
our product candidates, methods, processes, and other technologies infringe the proprietary rights of other parties, we could incur substantial
costs and we might have to:

 obtain licenses, which
 might not be available on commercially reasonable terms, if at all;

 abandon an infringing product
 candidate;

 redesign our product candidates
 or processes to avoid infringement;

 stop using the subject
 matter claimed in the patents held by others;

 pay damages; and/or

 defend litigation or administrative
 proceedings which might be costly whether we win or lose, and which could result in a substantial diversion of our financial and
 management resources.

 Any
of these events could substantially harm our earnings, financial condition, and operations.

 The
U.S. government could have "march-in rights" to certain of our intellectual property.

 If
at any time federal monies are used in support of the research and development activities at MDACC that resulted or in the future result
in certain of our issued pending U.S. patent applications, the federal government retains what are referred to as "march-in rights"
to patents that are granted on these applications. Our license agreements for Mino-Lok and Mino-Wrap each provide that in the event of
such governmental funding, our rights are subject to the government's prior rights, if any. In addition, the license agreements
provide that we will comply with the requirements of any agreement between MDACC and the governmental funding entity. If applicable,
this could require us to grant the U.S. government either a nonexclusive, partially exclusive, or exclusive license to the patented invention
in any field of use, upon terms that are reasonable for a particular situation. Circumstances that could trigger march-in rights generally
would be set out in the agreement between MDACC and the funding governmental entity and could include, for example, failure to take,
within a reasonable time, effective steps to achieve practical application of the invention in a field of use, failure to satisfy the
health and safety needs of the public and failure to meet requirements of public use specified by federal regulations. A funding governmental
entity could elect to exercise these march-in rights on their own initiative or at the request of a third party; however, the exercise
of such march-in rights has been historically rare when the patent holder (or its licensee) is practicing the patent invention although
there can be no assurance that such rights would not be exercised. This same risk would apply to any other license into which we enter
if the licensor receives government funding for the product candidate that is the subject of the license.

 If
our trademarks and trade names are not adequately protected, then we may not be able to build name recognition and our business, financial
condition and results of operations may be adversely affected.

 We
have registered a trademark with the USPTO for the marks "LYMPHIR" and "Mino-Lok". Thses and any other trademarks
or trade names we may obtain may be challenged, infringed, diluted, tarnished, circumvented or declared generic or determined to be infringing
on other marks. The Company may not be able to protect our rights to these trademarks and trade names, which we need to build name recognition
among potential partners or customers in the markets of interest. At times, competitors or other third parties may adopt similar trade
names or trademarks, thereby impeding our ability to build brand identity and possibly leading to market confusion. In addition, there
could be potential trade name or trademark infringement, dilution or tarnishment claims brought by owners of other registered trademarks
or trademarks that incorporate variations of our registered or unregistered trademarks or trade names. Over the long term, if we are
unable to establish name recognition based on our trademarks and trade names, then we may not be able to compete effectively and our
business, financial condition and results of operations may be adversely affected. The Company's efforts to enforce or protect
our proprietary rights related to trademarks, trade secrets, domain names, copyrights or other intellectual property may be ineffective
and could result in substantial costs and diversion of resources.

 Risks
Related to Our Planned Spinoff of Citius Oncology

 The
Business Combination is subject to the satisfaction or waiver of certain conditions, which may not be satisfied or waived on a timely
basis, if at all, and we may be unable to complete the Spinoff of Citius Oncology as a separate public company.

 The
consummation of the Business Combination is subject to customary closing conditions for transactions involving special purpose ac quisition
companies, including, among others:

 the
 expiration or termination of the waiting period under the Hart Scott Rodino Act;

 receipt
 of required consents and approvals from certain governmental authorities;

 no
 agreement with any governmental authority pursuant to which Citius Pharma or TenX has agreed
 not to consummate the Business Combination;

 no
 governmental authority of competent jurisdiction shall have enacted, issued or granted any
 law that has the effect of restraining, enjoining or prohibiting the consummation of the
 transaction;

 TenX
 has at least $5,000,001 of net tangible assets as of the Closing;

 no
 outstanding or uncured written notice has been received by TenX from Nasdaq stating that
 it has failed, or would reasonably be expected to fail to meet the Nasdaq initial listing
 requirements or Nasdaq continued listing requirements as of the Effective Date for any reason;

 the
 parties have performed and complied in all material respects with the obligations, covenants
 and agreements required by the Merger Agreement;

 customary
 bring down conditions related to the accuracy of the parties' respective representations,
 warranties and pre-Closing covenants in the Merger Agreement, including the absence of any
 "Material Adverse Effect" (as defined in the Merger Agreement);

 TenX's
 registration statement that has been filed with the SEC has become effective; and

 the
 requisite TenX's shareholders' approvals have been received.

 Additionally,
as previously announced, Citius Pharma is in the process of formulating a plan of distribution to its stockholders of a portion of the
shares of the Combined Company that Citius Pharma is to receive in the Business Combination (the "Distribution").
The criteria to determine the timing, size and other factors related to such Distribution will be determined and announced by us at a
later date.

 We
cannot assure you that we will be able to complete the Business Combination or Spinoff or a Distribution due to many factors outside
of our control. The completion of the anticipated Spinoff of Citius Oncology and any Distribution will also require significant
amounts of our management's time and effort, which may divert management's attention from operating and growing our business.

 We
may be unable to achieve some or all of the benefits that we expect to achieve from the Spinoff.

 The
Company believes that separating LYMPHIR into a standalone entity would create two focused standalone public companies that are better
positioned to pursue their strategic priorities, invest in growth opportunities, and attract new investors. The Company also believes
that the Business Combination and Spinoff will result in significant benefits to our Company and our stockholders as a result of unlocking
the value we believe that Citius Oncology would have as a standalone publicly traded company. However, by separating from Citius Pharma,
Citius Oncology might be more susceptible to market fluctuations and we may be unable to achieve some or all of the benefits that we
expect Citius Oncology to achieve as an independent company in the time we expect, if at all. Further, if the Business Combination's
benefits do not meet the expectations of financial analysts, or due to the other factors discussed in this " Risk Factors "
section and elsewhere in this report, the market price of the Combined Company's common stock might decline or increase in volatility.

Oncology currently has only one product candidate that is in late stage development and it is heavily dependent on the approval, launch
and commercial success of LYMPHIR.

 In
April 2022, Citius Pharma transferred the assets related to LYMPHIR to Citius Oncology. LYMPHIR is Citius Oncology's only late-stage
product candidate, and it has not been approved for commercial sale, while the other product candidates are in the pre-clinical stage.
Upon completion of the anticipated Business Combination, Citius Pharma will become a majority stockholder of the Combined Company, and
as a result, we will only be entitled to a portion of the benefits, if any, that flow from the development by Citius Oncology of its
LYMPHIR product candidate or any other product candidates that it might develop.

Oncology is entirely dependent upon the successful commercial launch of LYMPHIR to generate revenue for the foreseeable future. Even
if Citius Oncology receives approval for LYMPHIR for the treatment of CTCL, the commercial launch in the U.S. is not expected to occur
until the second half of 2024. As a result, it is difficult to evaluate Citius Oncology's current business and predict its future
prospects due to the other factors discussed in this " Risk Factors " section and elsewhere in this report. We cannot
assure you that LYMPHIR will gain market acceptance among physicians, health care payors, patients and the medical community, which is
critical to its commercial success.

 Even
after the completion of the Business Combination, the Combined Company will require substantial additional funding, which may not be
available on acceptable terms, or at all.

Oncology's operations have consumed substantial amounts of cash since inception and Citius Oncology expects to significantly increase
its spending to continue its commercialization efforts for LYMPHIR, advance development of LYMPHIR for other indications and launch and
commercialize any product candidates for such indications for which it receives regulatory approval. Furthermore, following the Business
Combination, the Combined Company will have additional costs associated with operating as a public company. The Combined Company will
require additional capital to fund its other operating expenses and capital expenditures.

 Following
consummation of the Business Combination, until the Combined Company is able to generate significant revenue, if ever, we expect it to
finance its operations through a combination of equity offerings, debt financings, collaborations or other strategic transactions. We
cannot be sure that any additional funding, if needed, will be available on terms favorable to it, or at all. Any additional fundraising
efforts may divert its management from their day-to-day activities, which may adversely affect its ability to develop and commercialize
its product candidates.

 If
Citius Oncology or the Combined Company raises additional funds through collaborations or strategic alliances with third parties, it
may have to relinquish valuable rights to its product candidates, future revenue streams, research programs or technologies, or grant
licenses on terms that may not be favorable to it. If Citius Oncology or the Combined Company is unsuccessful in its efforts to raise
additional financing on acceptable terms, it may be required to significantly reduce or cease its operations.

 The
amount and timing of its future funding requirements will depend on many factors, some of which are outside of our control, including
but not limited to:

 the costs and expenses
 associated with its ongoing commercialization efforts for LYMPHIR;

 the degree of success it
 experiences in commercializing LYMPHIR;

 the revenue generated by
 sales of LYMPHIR and other products that may be approved, if any;

 the scope, progress, results
 and costs of conducting studies and clinical trials for its other product candidates, if any, resulting from its ongoing research
 with LYMPHIR for other possible indications;

 the timing of, and the
 costs involved in, obtaining regulatory approvals for LYMPHIR and its other product candidates;

 the costs of manufacturing
 LYMPHIR and any other potential product candidates it develops;

 the timing and amount of
 any milestone, royalty or other payments it is required to make pursuant to any current or future license agreements;

 the extent to which LYMPHIR
 or any of its other potential product candidates, if approved for commercialization, is adopted by the physician community;

 the effect of competing
 products and product candidates and other market developments;

 the number and types of
 future product candidates it might develop and commercialize;

 any product liability or
 other lawsuits related to its products candidates and any approve products;

 the expenses needed to
 attract, hire and retain skilled personnel;

 the costs associated with
 being a public company after the closing of the Business Combination;

 its need to implement additional
 internal systems and infrastructure, including financial and reporting systems;

 the costs of preparing,
 filing and prosecuting patent applications and maintaining, enforcing and defending intellectual property-related claims; and

 the extent and scope of
 its general and administrative expenses.

 Future
sales or issuances of a substantial number of shares of the Combined Company's common stock may cause the price of its common stock
to decline.

Oncology is, and after the Business Combination, the Combined Company is expected to be, authorized to issue an aggregate of 100,000,000
shares of common stock and 10,000,000 shares of preferred stock. Any additional equity or equity-related financing may be dilutive to
its stockholders, and debt or equity financing, if available, might subject Citius Oncology or the Combined Company to restrictive covenants
and significant interest costs. Citius Oncology, and after the Business Combination, the Combined Company, might also issue additional
shares of common stock or other securities that are convertible into or exercisable for common stock in connection with hiring or retaining
employees, or for other business purposes.

to the amended and restated registration rights agreement to be entered into in connection with the Business Combination, certain stockholders
TenX, the TenX sponsor and certain equity holders of Citius Pharma can demand that the Combined Company can register their registrable
securities under certain circumstances and will each also have piggyback registration rights for these securities. The registration of
these securities will permit the public sale of such securities, subject to certain contractual restrictions imposed by the amended and
restated registration rights agreement and the Merger Agreement.

 The
future sales or issuances of any such shares of the Combined Company's common stock or common stock equivalents may create downward
pressure on the trading price of the Combined Company or our common stock.

 The
announcement of the proposed Business Combination could disrupt Citius Pharma's or Citius Oncology's relationships with their
respective customers, suppliers, business partners and others, as well as their respective operating results and business generally.

 Risks
rela ting to the impact of the announcement of the Business Combination on our business include the following:

 our
 employees may experience uncertainty about their future roles, which might adversely affect
 our ability to retain and hire key personnel and other employees;

 customers,
 suppliers, business partners and other parties with which we maintain business relationships
 may experience uncertainty about its future and seek alternative relationships with third
 parties, seek to alter their business relationships with us or fail to extend an existing
 relationship with us; and

 we
 have expended and will continue to expend significant costs, fees and expenses for professional
 services and transaction costs in connection with the proposed Business Combination.

 If
any of the aforementioned risks were to materialize, they could lead to significant costs which may impact the Combined Company's
results of operations and cash available to fund its business.

 Conflicts
of interest may arise from the Combined Company's relationship with Citius Pharma.

 Immediately
after the Business Combination, all of the Combined Company's directors, executive officers and employees will also be directors
and employees of Citius Pharma; the employees will all be available pursuant to the amended and restated shared services agreement. As
a result of this arrangement, the Combined Company's relationship with Citius Pharma could give rise to certain
conflicts of interest that could have an impact on its research and development programs, business opportunities, and operations generally.

 Even
though the Combined Company is developing different technologies in different fields than Citius Pharma, the Combined Company could find
itself in competition with Citius Pharma for research scientists, financing and other resources, licensing, manufacturing, and distribution
arrangements. The Combined Company will engage for its own business in research and product development programs, investments, and business
ventures, and Citius Pharma will not be entitled to participate or to receive an interest in those programs, investments, or business
ventures. The Combined Company will not be obligated to present any particular research and development, investment, or business opportunity
to us, even if the opportunity would be within the scope of our research and development plans or programs, business objectives, or investment
policies. These opportunities may include, for example, opportunities to acquire businesses or assets, including but not limited to patents
and other intellectual property that could be used by the Combined Company or by Citius Pharma.

 Potential
conflicts of interest could also arise in connection with the resolution of any dispute that may arise between Citius Pharma and the
Combined Company regarding the terms of the amended and restated shared services agreement governing the services provided by Citius
Pharma to the Combined Company and the relationship between the companies. Potential conflicts of interest may also arise if the Combined
Company enters into additional commercial arrangements with Citius Pharma in the future. As a result of these actual or apparent conflicts,
the Combined Company or Citius Pharma, might be precluded from pursuing certain growth initiatives.

 Each
conflict of interest will be resolved by the respective boards of directors in keeping with their fiduciary duties and such policies
as they may implement from time to time. As noted above, there will be overlap among the Combined Company's board of directors,
senior management and research staffs and that of Citius Pharma. These overlapping positions could interfere with the duties owed by
such individuals to Citius Pharma.

 A
Distribution in connection with or following the Spinoff of Combined Company shares to our stockholders could result in significant tax
liability to Citius Pharma and our stockholders.

 A
Distribution of Combined Company shares to our stockholders would not qualify for non-recognition of gain and loss, and therefore, our
stockholders could be subject to tax. Each U.S. holder who receives Combined Company stock in a Distribution would generally be treated
as receiving a Distribution in an amount equal to the fair market value of the Combined Company common stock received, which would generally
result in (i) a taxable dividend to the stockholder to the extent that stockholder's pro rata share of Citius Pharma's current
or accumulated earnings and profits; (ii) a reduction in the stockholder's basis (but not below zero) in Citius Pharma's
common stock to the extent the amount received exceeds the stockholder's shares of Citius Pharma's earnings and profits;
and (iii) a taxable gain from the exchange of Citius Pharma's stock to the extent the amount received exceeds the sum of the stockholder's
share of Citius Pharma's earnings and profits and the stockholder's basis in its Citius Pharma stock.

Pharma will also recognize a taxable gain in an amount up to the fair market value of any distributed Combined Company stock in excess
of the taxable basis in such distributed shares.

 Any
legal proceedings in connection with the Business Combination, the outcomes of which are uncertain, could delay or prevent the completion
of the Business Combination.

 In
connection with business combination transactions similar to the proposed Business Combination, it is not uncommon for lawsuits to be
filed against the parties and/or their respective directors and officers alleging, among other things, that the proxy statement/prospectus
provided to stockholders contains false and misleading statements and/or omits material information concerning the transaction. Although
no such lawsuits have yet been filed in connection with the Business Combination, it is possible that such actions may arise and, if
such actions do arise, they generally would seek, among other things, injunctive relief and an award of attorneys' fees and expenses.
Defending such lawsuits could require the parties to incur significant costs and draw the attention of the parties' management
teams away from the consummation of the Business Combination. Further, the defense or settlement of any lawsuit or claim that remains
unresolved at the time the Business Combination is consummated may adversely affect the Combined Company's business, financial
condition, results of operations and cash flows. Such legal proceedings could delay or prevent the Business Combination from being consummated
within the expected timeframe.

 Risks
Related to Our Securities

 Our
failure to maintain compliance with Nasdaq's continued listing requirements could result in the delisting of our common stock.

Pharma common stock is currently listed on The Nasdaq Capital Market and following the Business Combination, the Combined Company intends
to separately list its common stock on The Nasdaq Global Market. In order to maintain these listings, each entity must satisfy minimum
financial and other requirements.

 On
September 12, 2023, Citius Pharma received a notification letter from the Nasdaq Stock Market LLC ("Nasdaq") indicating that
we were not in compliance with Nasdaq Listing Rule 5550(a)(2) because the minimum bid price of our common stock on the Nasdaq Capital
Market closed below $1.00 per share for 30 consecutive business days. In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company
has a compliance period of 180 calendar days, or until March 11, 2024, to regain compliance with the Bid Price Rule. If at any time before
March 11, 2024, the bid price of the Company's common stock closes at $1.00 per share or more for a minimum of ten consecutive business
days, Nasdaq will provide the Company with a written confirmation of compliance with the Bid Price Rule. While Citius Pharma intends
to engage in efforts to regain compliance, and thus maintain our listing, there can be no assurance that we will be successful or continue
to meet all applicable Nasdaq Capital Market requirements in the future.

 If
Citius Pharma's (or following the Business Combination, the Combined Company's) common stock were to be removed from listing
with Nasdaq, it may be subject to the so-called "penny stock" rules. The SEC has adopted regulations that define a "penny
stock" to be any equity security that has a market price per share of less than $5.00, subject to certain exceptions, such as any
securities listed on a national securities exchange, which is the exception on which we currently rely. For any transaction involving
a "penny stock," unless exempt, the rules impose additional sales practice requirements on broker-dealers, subject to certain
exceptions. If our common stock were delisted and determined to be a "penny stock," a broker-dealer may find it more difficult
to trade our common stock and an investor may find it more difficult to acquire or dispose of our common stock on the secondary market.

 If
Citius Pharma's (or following the Business Combination, the Combined Company's) common stock is delisted and there is no
longer an active trading market for our shares, it may, among other things:

 cause
 stockholders difficulty in selling Citius Pharma's or the Combined Company's shares without depressing the market price
 for the shares or selling the shares at all;

 substantially
 impair the ability to raise additional funds;

 result
 in a loss of institutional investor interest and fewer financing opportunities; and/or

 result
 in potential breaches of representations or covenants of agreements pursuant to which Citius Pharma or the Combined Company made
 representations or covenants relating to compliance with applicable listing requirements. Claims related to any such breaches, with
 or without merit, could result in costly litigation, significant liabilities and diversion of management's time and attention
 and could have a material adverse effect on the financial condition, business and results of operations.

 A
delisting would also reduce the value of Citius Pharma's or the Combined Company's equity compensation plans, which could
negatively impact the ability to retain employees.

 You
may experience dilution of your ownership interests because of the future issuance of additional shares of our common stock or securities
convertible into common stock.

 For
the foreseeable future, to finance our operations, including possible acquisitions or strategic transactions, we expect to issue equity
securities, resulting in the dilution of the ownership interests of our present stockholders. We are currently authorized to issue an
aggregate of 400,000,000 shares of common stock and 10,000,000 shares of preferred stock. As of September 30, 2023, there were 158,857,798
shares of common stock outstanding, 50,923,819 shares underlying warrants with a weighted average exercise price of $1.50 per share and
13,305,171 shares underlying options with a weighted average exercise price of $1.79 per share. We may also issue additional shares of
our common stock or other securities that are convertible into or exercisable for common stock in connection with hiring or retaining
employees, or for other business purposes. The future issuance of any such additional shares of common stock or common stock equivalents
may create downward pressure on the trading price of our common stock or publicly traded warrants.

 Our
Certificate of Incorporation allows for our Board of Directors to create new series of preferred stock without further approval by our
stockholders, which could adversely affect the rights of the holders of the common stock.

 Our
Board of Directors has the authority to issue up to 10,000,000 shares of preferred stock and to fix and determine the relative rights
and preferences of any such preferred stock without further stockholder approval. As a result, our Board of Directors could authorize
the issuance of one or more series of preferred stock that would grant preferential rights to our assets upon liquidation, the right
to receive dividend payments before dividends are distributed to the holders of common stock and the right to the redemption of the preferred
shares, together with a premium, prior to the redemption of the common stock. In addition, our Board of Directors could authorize the
issuance of a series of preferred stock that has greater voting power than the common stock or that is convertible into our common stock,
which could decrease the relative voting power of the common stock or result in dilution to our existing stockholders.

 We
have not paid cash dividends in the past and we do not expect to pay cash dividends in the foreseeable future. Any return on investment
may be limited to the capital appreciation, if any, of our common stock.

 We
have not paid cash dividends on our common stock and we (and following the Business Combination, the Combined Company) do not anticipate
paying cash dividends on its capital in the foreseeable future. The payment of dividends on the capital stock will depend on the respective
earnings, financial condition and other business and economic factors affecting them at such time as the board of directors may consider
relevant. In addition, the ability to pay dividends may be limited by covenants in any future outstanding indebtedness that either entity
may incur. Since the Combined Company does not intend to pay dividends, a stockholder's ability to receive a return on such stockholder's
investment will depend on any future appreciation in the market value of the Combined Company's common stock. There is no guarantee
that either entity's common stock will appreciate or even maintain the price at which its stockholders have purchased it.

 Provisions
in our Amended and Restated Articles of Incorporation, as amended, and under Nevada law could discourage a takeover that stockholders
may consider favorable and may lead to entrenchment of management.

 Provisions
of our articles of incorporation and bylaws may delay or discourage transactions involving an actual or potential change of control or
change in our management, including transactions in which stockholders might otherwise receive a premium f or
their shares, or transactions that our stockholders might otherwise deem to be in their best interests. Therefore, these provisions could
adversely affect the price of our common stock. Among other things, these provisions include:

 the
 authorization of 10,000,000 shares of "blank check" preferred stock, the rights,
 preferences and privileges of which may be established and shares of which may be issued
 by our Board of Directors at its discretion from time to time and without stockholder approval;

 limiting
 the removal of directors by the stockholders;

 allowing
 for the creation of a staggered Board of Directors;

 eliminating
 the ability of stockholders to call a special meeting of stockholders; and

 establishing
 advance notice requirements for nominations for election to the Board of Directors or for
 proposing matters that can be acted upon at stockholder meetings.

 Additionally,
 Nevada's "combinations with interested stockholders" statutes prohibit certain business "combinations"
between certain Nevada corporations and any person deemed to be an "interested stockholder" for two years after such person
first becomes an "interested stockholder" unless (i) the corporation's Board of Directors approves the combination
(or the transaction by which such person becomes an "interested stockholder") in advance, or (ii) the combination is approved
by the Board of Directors and 60% of the corporation's voting power
not beneficially owned by the interested stockholder, its affiliates and associates. Furthermore, in the absence of prior approval, certain
restrictions may apply even after such two-year period. For purposes of these statutes, an "interested stockholder" is any
person who is (x) the beneficial owner, directly or indirectly, of 10% or more of the voting power of the outstanding voting shares of
the corporation, or (y) an affiliate or associate of the corporation and at any time within the two previous years was the beneficial
owner, directly or indirectly, of 10% or more of the voting power of the then outstanding shares of the corporation. The definition of
the term "combination" is sufficiently broad to cover most significant transactions between the corporation and an "interested
stockholder". Subject to certain timing requirements set forth in the statutes, a corporation may elect not to be governed by these
statutes. We have not included any such provision in our articles of incorporation.

 We
are not currently subject to Nevada's "acquisition of controlling interest" statutes that contain provisions governing
the acquisition of a controlling interest in certain Nevada corporations. If these laws were to apply to us, they might further discourage
companies or persons interested in acquiring a significant interest in or control of the Company, regardless of whether such acquisition
may be in the interest of our stockholders.

 The
effect of these statutes may be to potentially discourage parties interested in taking control of the Company from doing so if it cannot
obtain the approval of our Board of Directors.

 Item
1B. Unresolved Staff Comments

 Not
applicable.

 Item
1C. Cybersecurity

 Not applicable.

 Item
2. Properties

 We
lease our offices at 11 Commerce Drive, First Floor, Cranford, New Jersey 07016. The lease runs until October 31, 2025.

 Item
3. Legal Proceedings

 We
are not involved in any litigation that we believe could have a material adverse effect on our financial position or results of operations.
There is no action, suit, proceeding, inquiry, or investigation before or by any court, public board, government agency, self-regulatory
organization or body pending or, to the knowledge of our executive officers, threatened against or affecting our company or our officers
or directors in their capacities as such.

 In
the future, we might from time to time become involved in litigation relating to claims arising from our ordinary course of business.

 Item
4. Mine Safety Disclosures

 Not
applicable.

 PART
II

 Item
5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 The
information regarding our equity compensation plans required by this Item is found in Item 12 of this report.

Information

 Our
common stock trades on The Nasdaq Capital Market under the symbol "CTXR."

 Holders
of Common Stock

 As
December 27, 2023, we had approximately 92 stockholders of record of our common stock.

 Dividends

 We
have never paid dividends on our common stock. We intend to follow a policy of retaining earnings, if any, to finance the growth of our
business and do not anticipate paying any cash dividends in the foreseeable future. The declaration and payment of future dividends on
the common stock will be at sole discretion of our Board of Directors and will depend on our profitability and financial condition, capital
requirements, statutory and contractual restrictions, future prospects and other factors deemed relevant by the Board.

 Recent
Sales of Unregistered Securities

 In
August 2023, we extended the term by one year to August 14, 2024 for an aggregate of 3,921,569 warrants with an exercise price of $1.15
per share of common stock. The warrants are held by Leonard Mazur, the Company's Chief Executive Officer and Chairman of the Board
of Directors, and Myron Holubiak, the Company's Executive Vice President and a member of the Board of Directors, and were originally
issued in August 2018 in a private placement conducted simultaneously with a registered direct offering of shares of common stock (the
"2018 Offering") managed by H. C. Wainwright & Co., LLC ("Wainwright"). Mr. Mazur and Mr. Holubiak participated
in the private placement on the same basis as all other investors. Additionally, 189,412 placement agent warrants with an exercise price
of $1.5938 per share issued in connection with the 2018 Offering were extended by one year to August 8, 2024. Such placement agent warrants
are held by certain representatives of Wainwright. There are no other warrants remaining outstanding from the 2018 Offering and if such
warrants are fully exercised, the Company would receive $4,811,680 in cash proceeds.

 Issuer
Purchases of Equity Securities

 We
did not make any purchases of our common stock during the three months ended September 30, 2023, which is the fourth quarter of our fiscal
year.

 Item
6. [Reserved]

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

 The
following discussion and analysis of our financial condition and results of operations should be read together with our financial statements
and related notes included elsewhere in this annual report on Form 10-K. Management's discussion and analysis contains forward-looking
statements, such as statements of our plans, objectives, expectations, and intentions. Any statements that are not statements of historical
fact are forward-looking statements. When used, the words "believe," "plan," "intend," "anticipate,"
"target," "estimate," "expect" and the like, and/or future tense or conditional constructions ("will,"
"may," "could," "should," etc.), or similar expressions, identify these forward-looking statements.
These forward-looking statements are subject to risks and uncertainties including those under "Risk Factors" in Item 1A in
this Form 10-K that could cause actual results or events to differ materially from those expressed or implied by the forward-looking
statements. Our actual results and the timing of events could differ materially from those anticipated in these forward-looking statements
as a result of several factors. We do not undertake any obligation to update forward-looking statements to reflect events or circumstances
occurring after the filing date of this report.

 Historical
Background

 We
are a late-stage biopharmaceutical company dedicated to the development and commercialization of first-in-class critical care products
with a focus on oncology, anti-infectives in adjunct cancer care, unique prescription products and stem cell therapies. On September
12, 2014, we acquired Citius Pharmaceuticals, LLC as a wholly-owned subsidiary.

 On
March 30, 2016, we acquired all of the outstanding stock of Leonard-Meron Biosciences, Inc. ("LMB") by issuing shares of
our common stock. We acquired identifiable intangible assets of $19,400,000 related to in-process research and development and recorded
goodwill of $9,346,796 for the excess of the purchase consideration over the net assets acquired.

 On
September 11, 2020, we formed NoveCite, Inc. ("NoveCite"), a Delaware corporation, of which we own 75% of the issued and
outstanding capital stock.

 On
August 23, 2021, we formed Citius Oncology, Inc. (formerly Citius Acquisition Corp.) as a wholly-owned subsidiary in conjunction with
the acquisition of LYMPHIR, but Citius Oncology did not begin operations until April 2022, when Citius Pharma transferred the assets
related to LYMPHIR to Citius Oncology, including the related license agreement with Eisai and the related asset purchase agreement with
Dr. Reddy's Laboratories SA, a subsidiary of Dr. Reddy's.

research and development of $19,400,000 represents the value of LMB's leading drug candidate (Mino-Lok), which is an antibiotic
solution used to treat catheter-related bloodstream infections and is expected to be amortized on a straight-line basis over a period
of eight years commencing upon revenue generation. Goodwill of $9,346,796 represents the value of LMB's industry relationships
and its assembled workforce. Goodwill will not be amortized but will be tested at least annually for impairment. In-process research
and development of $40,000,000 represents the value of our September 2021 acquisition of an exclusive license for LYMPHIR (denileukin
diftitox), a late-stage oncology immunotherapy for the treatment of CTCL, a rare form of non-Hodgkin lymphoma and is expected to be amortized
on a straight-line basis over a period of twelve years commencing upon revenue generation.

 Through
September 30, 2023, we have devoted substantially all our efforts to product development, raising capital, building infrastructure through
strategic alliances and coordinating activities relating to our proprietary products. We have not yet realized any revenues from our
operations.

 Recent
Developments

 On
October 23, 2023, Citius Pharma and Citius Oncology entered into the Merger Agreement with TenX and Merger Sub. The Merger Agreement
provides, among other things, (i) on the terms and subject to the conditions set forth therein, that Merger Sub will merge with and into
Citius Oncology, with Citius Oncology surviving as a wholly owned subsidiary of TenX, and (ii) that prior to the Effective Time, TenX
will migrate to and domesticate as a Delaware corporation. The publicly traded Combined Company is to be named "Citius Oncology,
Inc."

and Technology License Agreements

 – LMB has a patent and technology license agreement with Novel Anti-Infective Therapeutics, Inc. ("NAT") to develop
and commercialize Mino-Lok on an exclusive, worldwide sub-licensable basis, as amended. Since May 2014, LMB has paid an annual maintenance
fee, which began at $30,000 and has increased over five years to $90,000, where it will remain until the commencement of commercial sales
of a product subject to the license. LMB will also pay annual royalties on net sales of licensed products, with royalties ranging from
the mid-single digits to the low double digits. In limited circumstances in which the licensed product is not subject to a valid patent
claim and a competitor is selling a competing product, the royalty rate is in the low single digits. After a commercial sale is obtained,
LMB must pay minimum aggregate annual royalties that increase in subsequent years. LMB must also pay NAT up to $1,100,000 upon achieving
specified regulatory and sales milestones. Finally, LMB must pay NAT a specified percentage of payments received from any sub licensees.

 Mino-Wrap
 – On January 2, 2019, we entered into a patent and technology license agreement with the Board of Regents of the University
of Texas System on behalf of the University of Texas M. D. Anderson Cancer Center ("Licensor"), whereby we in-licensed exclusive
worldwide rights to the patented technology for any and all uses relating to breast implants. We intend to develop a liquefying
gel-based wrap containing minocycline and rifampin for the reduction of infections associated with breast implants following breast reconstructive
surgeries. We are required to use commercially reasonable efforts to commercialize Mino-Wrap under several regulatory scenarios and achieve
milestones associated with these regulatory options leading to an approval from the FDA.

 Under
the license agreement, we paid a nonrefundable upfront payment of $125,000. We are obligated to pay an annual maintenance fee of $30,000,
commencing in January 2020 that increases annually by $15,000 per year up to a maximum of $90,000. Annual maintenance fees cease on the
first sale of product. We also must pay up to an aggregate of $2.1 million in milestone payments, contingent on the achievement of various
regulatory and commercial milestones. Under the terms of the license agreement, we also must pay a royalty of mid- to upper-single digit
percentages of net sales, depending on the amount of annual sales, and subject to downward adjustment to lower- to mid-single digit percentages
in the event there is no valid patent for the product in the U.S. at the time of sale. After the first sale of product, we will owe an
annual minimum royalty payment of $100,000 that will increase annually by $25,000 for the duration of the term. We will be responsible
for all patent expenses incurred by Licensor for the term of the agreement although Licensor is responsible for filing, prosecution,
and maintenance of all patents.

 – On October 6, 2020, our subsidiary NoveCite entered into a license agreement with Novellus Therapeutics Limited ("Licensor"),
whereby NoveCite acquired an exclusive, worldwide license, with the right to sublicense, to develop and commercialize a stem cell therapy
based on the Licensor's patented technology for the treatment of acute pneumonitis of any etiology in which inflammation is a major
agent in humans. Upon execution of the license agreement, NoveCite paid an upfront payment of $5,000,000 to Licensor and issued to Licensor
shares of Novecite's common stock representing 25% of NoveCite's currently outstanding equity. We own the other 75% of NoveCite's
currently outstanding equity.

 In
July 2021, Novellus was acquired by Brooklyn ImmunoTherapeutics ("Brooklyn"). Pursuant to this transaction, the NoveCite
license was assumed by Brooklyn with all original terms and conditions. In October 2021, Brooklyn changed its name to Eterna Therapeutics
Inc. ("Eterna").

 As
part of the Novellus and Brooklyn merger transaction, the 25% non-dilutive position per the subscription agreement between Novellus and
NoveCite was removed.

 Under
the license agreement, NoveCite is obligated to pay Licensor up to an aggregate of $51,000,000 in regulatory and developmental milestone
payments. NoveCite also must pay a royalty equal to low double-digit percentages of net sales, commencing upon the first commercial sale
of a licensed product. This royalty is subject to downward adjustment on a product-by-product and country-by-country basis to an upper-single
digit percentage of net sales in any country in the event of the expiration of the last valid patent claim or if no valid patent claim
exists in that country. The royalty will end on the earlier of (i) date on which a biosimilar product is first marketed, sold, or distributed
by Licensor or any third party in the applicable country or (ii) the 10-year anniversary of the date of expiration of the last-to-expire
valid patent claim in that country. In the case of a country where no licensed patent ever exists, the royalty will end on the later
of (i) the date of expiry of such licensed product's regulatory exclusivity and (ii) the 10-year anniversary of the date of the
first commercial sale of the licensed product in the applicable country. In addition, NoveCite will pay to Licensor an amount equal to
a mid-twenties percentage of any sublicensee fees it receives.

 Under
the terms of the license agreement, in the event that Licensor receives any revenue involving the original cell line included in the
licensed technology, then Licensor shall remit to NoveCite 50% of such revenue.

 - In September 2021, the Company announced that it had entered into a definitive agreement with Dr. Reddy's to acquire its
exclusive license of E7777 (denileukin diftitox), a late-stage oncology immunotherapy for the treatment of CTCL, a rare form of non-Hodgkin
lymphoma. Citius Pharma subsequently renamed E7777 as LYMPHIR.

 Under
the terms of this agreement, Citius Pharma acquired Dr. Reddy's exclusive license of LYMPHIR from Eisai and other related assets
owned by Dr. Reddy's (now owned by Citius Oncology). Our exclusive license rights, through our subsidiary, include rights to develop
and commercialize LYMPHIR in all markets except for Japan and certain parts of Asia. Additionally, we, through our subsidiary, have an
option on the right to develop and market the product in India. Eisai retains exclusive development and marketing rights for the agent
in Japan and Asia. Dr. Reddy's received a $40 million upfront payment and is entitled to up to $40 million in development milestone
payments related to CTCL approvals in the U.S. and other markets, up to $70 million in development milestones for additional indications,
as well as commercial milestone payments and low double-digit tiered royalties on net product sales. Eisai is to receive a $6 million
development milestone payment upon initial approval and additional commercial milestone payments related to the achievement of net product
sales thresholds. Eisai was responsible for completing the CTCL clinical trial, and CMC activities through the filing of a Biologics
License Application ("BLA") for LYMPHIR with the FDA. The BLA was filed in September 2022. We, through Citius Oncology, will
be responsible for development costs associated with potential additional indications.

 On
July 29, 2023, we received a Complete Response Letter, ("CRL") from the FDA regarding the BLA seeking approval for LYMPHIR.
The FDA has required that we incorporate enhanced product testing, and additional controls agreed to with the FDA during the market application
review. The FDA raised no concerns relating to the safety and efficacy clinical data package.

 On
September 8, 2023, we announced that the FDA agreed with our plans to address the requirements outlined in the CRL. The guidance from
the FDA provides a path for completing the necessary activities to support the resubmission of the BLA. No additional clinical efficacy
or safety trials have been requested by the FDA for the resubmission. Based on the feedback from the FDA, we plan to complete the CRL
remediation activities by the end of the year and file the resubmission in early 2024.

 Results
of Operations for Year Ended September 30, 2023 compared to Year Ended September 30, 2022

 Year
 Ended
 2023

 Year
 Ended
 2022

 Revenues

 $
 —

 $
 —

 Operating expenses:

 and development

 14,819,729

 17,655,482

 General and administrative

 15,295,584

 11,754,609

 Stock-based compensation
 – general and administrative

 Total operating expenses

 36,732,018

 33,316,045

 Operating loss

 (36,732,018
)

 (33,316,045
)

 Interest income

 1,179,417

 251,399

 Gain on sale of New
 Jersey net operating losses

 3,585,689

 —

 Loss before income taxes

 (31,966,912
)

 (33,064,646
)

 Income tax expense

 Net loss

 $
 (32,542,912
)

 $
 (33,640,646
)

 Revenues

 We
did not generate any revenues for the years ended September 30, 2023 and 2022.

and Development Expenses

 For
the year ended September 30, 2023, research and development expenses were $14,819,729 as compared to $17,655,482 for the year ended September
30, 2022, a decrease of $2,835,753.

and development costs for Mino-Lok decreased by $33,894 to $4,216,761 for the year ended September 30, 2023 as compared to $4,250,655
for the year ended September 30, 2022, driven primarily by decreased start-up costs associated with the global clinical research organization,
Biorasi, LLC, that assisted in the opening of international sites, primarily in India, for the Phase 3 Mino-Lok trial.

and development costs for our Halo-Lido product candidate increased by $1,378,662 to $4,076,010 for the year ended September 30, 2023
as compared to $2,697,348 for the year ended September 30, 2022 due to higher costs associated with the initiation of the Phase 2 study
for the year ended September 30, 2023. On June 20, 2023, we announced that the high dose formulation of CITI-002, a lidocaine and halobetasol
propionate combination formulation, provided a meaningful reduction in symptom severity, as reported by patients, when compared to individual
components alone. Moreover, there were no reported significant adverse events and CITI-002 was well tolerated by patients in the study.
Citius intends to schedule an end of Phase 2 meeting with the FDA to begin planning the next steps in the regulatory and clinical development
program for CITI-002.

the year ended September 30, 2023, research and development costs for our proposed novel cellular therapy for acute respiratory distress
syndrome (ARDS) were $193,898 as compared to $1,777,288 for the year ended September 30, 2022. The decrease of $1,583,390 was primarily
related to lower preclinical and manufacturing costs in the year ended September 30, 2023.

the year ended September 30, 2023, research and development expenses for our LYMPHIR product candidate were $6,081,385 as compared to
$8,693,775 during the year ended September 30, 2022. The decrease of $2,612,390 was primarily due to reduced costs associated with the
completion of the Phase 3 clinical trial, as well as the completion and submission of the Biologics License Application to the FDA, which
we filed in September 2022.

 We
expect that research and development expenses will continue to stabilize in fiscal 2024 as we continue to focus on the commercialization
of LYMPHIR, and complete our Phase 3 trial for Mino-Lok and our Phase 2b trial for Halo-Lido.

 General
and Administrative Expenses

 For
the year ended September 30, 2023, general and administrative expenses were $15,295,584 as compared to $11,754,609 for the year ended
September 30, 2022, an increase of $3,540,975. The primary reason for the increase was costs associated with pre-launch and market research
activities associated with LYMPHIR. General and administrative expenses consist primarily of compensation costs, professional fees for
legal, regulatory, accounting and corporate development services, and investor relations expenses.

Compensation Expense

 For
the year ended September 30, 2023, stock-based compensation expense was $6,616,705 as compared to $3,905,954 for the year ended September
30, 2022. Stock-based compensation expense includes options granted to directors, employees, and consultants. The primary reason for
the $2,710,751 increase in stock-based compensation expense was the grant of options under the Citius Oncology stock plan. Option expense
under the Citius Oncology stock plan was $1,965,500 during the year ended September 30, 2023. For the years ended September 30, 2023
and 2022, stock-based compensation expense also includes $130,382 and $133,332, respectively, for the NoveCite stock option plan. In
fiscal year 2023, we granted options to our new employees and additional options to other employees, our directors, and consultants.
At September 30, 2023, unrecognized total compensation cost related to unvested options for Citius Pharma common stock of $4,840,874
is expected to be recognized over a weighted average period of 1.5 years, unrecognized total compensation cost related to unvested options
for Citius Oncology common stock of $18,882,500 is expected to be recognized over a weighted average period of 2.6 years, and unrecognized
total compensation cost related to unvested options for NoveCite common stock of $47,575 is expected to be recognized over a weighted
average period of 0.7 years.

 Other
Income

the year ended September 30, 2023, the Company earned $1,179,417 of interest income compared to $251,399 of interest income during the
year ended September 30, 2022. The increase of $928,018 was due to higher interest rates earned on the investment of the remaining proceeds
from our equity offerings and common stock warrant exercises in money market accounts.

 Other
income for the year ended September 30, 2023 also includes the $3,585,689 gain recognized in connection with the sale of certain New
Jersey income tax net operating losses to a third party under the New Jersey Technology Business Tax Certificate Transfer Program.

 Income
Taxes

 The
Company recorded deferred income tax expense of $576,000 for in each of the years ended September 30, 2023 and 2022 related to the amortization
for taxable purposes of its in-process research and development asset.

 Net
Loss

 For
the year ended September 30, 2023, we incurred a net loss of $32,542,912 compared to a net loss of $33,640,646 for the year ended September
30, 2022. The $1,097,734 decrease in the net loss was primarily due to the increase in other income of $4,513,707 offsetting the increase
in our operating expenses of $3,415,973.

 LIQUIDITY
AND CAPITAL RESOURCES

 Liquidity
and Working Capital

Pharma has incurred operating losses since inception and incurred net losses of $32,542,912 and $33,640,646 for the years ended September
30, 2023 and 2022, respectively. At September 30, 2023, Citius Pharma had an accumulated deficit of $162,231,379. Citius Pharma's
net cash used in operations during the years ended September 30, 2023 and 2022 was $29,060,212 and $28,361,256, respectively.

 As
a result of our common stock offerings and common stock warrant exercises in fiscal year 2021 and the May 2023 registered direct offering,
the Company had working capital of approximately $29,000,000 at September 30, 2023. We expect that we will have sufficient funds to continue
our operations through August 2024. At September 30, 2023, Citius Pharma had cash and cash equivalents of $26,480,928 available to fund
its operations. The Company's only source of cash flow since inception has been from financing activities. During the year ended
September 30, 2023, the Company received net proceeds of $13,829,450, from the issuance of equity. Our primary uses of operating cash
were for in-licensing of intellectual property, product development and commercialization activities, employee compensation, consulting
fees, legal and accounting fees, insurance, and investor relations expenses.

 Financing
Activities

 In
November 2022, the Company was selected to participate in New Jersey's Technology Business Tax Certificate Transfer (NOL) Program
and received $3,585,689 million in non-dilutive capital through the New Jersey Economic Development Authority on December 29, 2022.

 On
May 8, 2023, the Company closed a registered direct offering with certain institutional investors for 12,500,001 common shares and warrants
to purchase 12,500,001 common shares, at a purchase price of $1.20 per share of common stock and accompanying warrant, for
gross proceeds of $15,000,001. The warrants have an exercise price of $1.50 per share, are exercisable six months from
the date of issuance, and expire five years from the date of issuance. The Company also issued 875,000 warrants to the placement agent
as part of the transaction. Net proceeds of the offering totaled approximately $13,798,183.

the year ended September 30, 2023, we received $31,267 in proceeds from the exercise of common stock options.

 Based
on our cash and cash equivalents at September 30, 2023, we expect that we will have sufficient funds to continue our operations through
August 2024. We expect to raise additional capital in the future to support our operations beyond August 2024. There is no assurance,
however, that we will be successful in raising the needed capital or that the proceeds will be received in an amount or in a timely manner
to support our operations.

 Inflation

 Our
management believes that inflation has not had a material effect on our results of operations.

 Off
Balance Sheet Arrangements

 We
do not have any off-balance sheet arrangements.

 CRITICAL
ACCOUNTING POLICIES

 Our
discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared
in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires
us to make estimates and judgments that affect the reported amounts of assets, liabilities and expenses and related disclosure of contingent
assets and liabilities. We review our estimates on an ongoing basis. We base our estimates on historical experience and on various other
factors that we believe to be reasonable under the circumstances. Actual results may differ from these estimates. We believe the judgments
and estimates required by the following accounting policies to be critical in the preparation of our financial statements.

and Development

and development costs, including upfront fees and milestones paid to collaborators who are performing research and development activities
under contractual agreement with us, are expensed as incurred. We defer and capitalize our nonrefundable advance payments that are for
research and development activities until the related goods are delivered or the related services are performed. When we are reimbursed
by a collaboration partner for work we perform, we record the costs incurred as research and development expenses and the related reimbursement
as a reduction to research and development expenses in our statement of operations. Research and development expenses primarily consist
of clinical and non-clinical studies, materials and supplies, third-party costs for contracted services, and payments related to external
collaborations and other research and development related costs.

Research and Development and Goodwill

research and development of $19,400,000 represents the value of LMB's drug candidate, Mino-Lok, an antibiotic lock solution in
Phase 3 clinical development, which if approved, would be used to treat catheter-related bloodstream infections, and is expected to be
amortized on a straight-line basis over a period of eight years commencing upon revenue generation. In-process research and development
of $40,000,000 represents the value of our September 2021 acquisition of an exclusive license for LYMPHIR (denileukin diftitox), a late-stage
oncology immunotherapy for the treatment of CTCL, a rare form of non-Hodgkin lymphoma and is expected to be amortized on a straight-line
basis over a period of twelve years commencing upon revenue generation.

 Goodwill
represents the value of LMB's industry relationships and its assembled workforce. Goodwill will not be amortized and will be tested
at least annually for impairment.

 The
Company reviews intangible assets annually to determine if any adverse conditions exist or a change in circumstances has occurred that
would indicate impairment or a change in the remaining useful life of any intangible asset. If the carrying value of an asset exceeds
its undiscounted cash flows, the Company writes down the carrying value of the intangible asset to its fair value for the period identified.
No impairments have occurred since the acquisitions of our intangible assets through September 30, 2023.

 The
Company evaluates the recoverability of goodwill annually or more frequently if events or changes in circumstances indicate that the
carrying value of an asset might be impaired, in accordance with Accounting Standard Update ("ASU") 2017-04, Intangibles
– Goodwill and Other (Topic 350): Simplifying the Accounting for Goodwill Impairment. Goodwill is first qualitatively assessed
to determine whether further impairment testing is necessary. Factors that management considers in this assessment include macroeconomic
conditions, industry and market considerations, overall financial performance (both current and projected), changes in management and
strategy and changes in the composition or carrying amount of net assets. If this qualitative assessment indicates that it is more likely
than not that the fair value of a reporting unit is less than its carrying amount, a one-step test is then performed in accordance with
ASU 2017-04. Under the simplified model, a goodwill impairment is calculated as the difference between the carrying amount of the reporting
unit and its fair value.

 The
Company performed a qualitative assessment for its 2023 analysis of goodwill. Based on this assessment, management does not believe that
it is more likely than not that the carrying value of the reporting unit exceeds its fair value. Accordingly, no further testing was
performed as management believes that there are no impairment issues with respect to goodwill as of September 30, 2023.

 Income
Taxes

 We
follow accounting guidance regarding the recognition, measurement, presentation, and disclosure of uncertain tax positions in the financial
statements. Tax positions taken or expected to be taken in the course of preparing our tax returns are required to be evaluated to determine
whether the tax positions are "more-likely-than-not" of being sustained by the applicable tax authorities. Tax positions
not deemed to meet a more-likely-than-not threshold would be recorded in the financial statements.

 We
recognize deferred tax assets and liabilities based on differences between the financial reporting and tax basis of assets and liabilities
using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. We provide a valuation
allowance for deferred tax assets for which we do not consider realization of such assets to be more likely than not.

 Item
7A. Quantitative and Qualitative Disclosures About Market Risk

 Not
required.

 Item
8. Financial Statements and Supplementary Data

FINANCIAL STATEMENTS

 Page

 Report of Independent Registered Public Accounting Firm (PCAOB ID # 392)

 Consolidated Balance Sheets

 Consolidated Statements of Operations

 Consolidated Statements of Changes in Stockholders' Equity

 Consolidated Statements of Cash Flows

 Notes to Consolidated Financial Statements

 F- 1

 REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 To
the Stockholders and Board of Directors of Citius Pharmaceuticals, Inc.:

 Opinion
on the Financial Statements

 We
have audited the accompanying consolidated balance sheets of Citius Pharmaceuticals, Inc. (the "Company") as of September
30, 2023 and 2022, and the related consolidated statements of operations, changes in stockholders' equity and cash flows for the
years then ended, and the related notes to the consolidated financial statements (collectively, the "financial statements").
In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of September
30, 2023 and 2022, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles
generally accepted in the United States of America.

 Emphasis
of a Matter Regarding Going Concern

 The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note
2 to the financial statements, the Company has suffered recurring losses and negative cash flows from operations and has a significant
accumulated deficit. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's
plans in regard to these matters are described in Note 2. The financial statements do not include any adjustments that might result from
the outcome of this uncertainty.

 Basis
for Opinion

 These
financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's
financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board
(United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 We
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company
is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our
audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing
an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such
opinion.

 Our
audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error
or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits
provide a reasonable basis for our opinion.

 Critical
Audit Matters

 Critical
audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required
to be communicated to the board of directors and that: (1) relate to accounts or disclosures that are material to the financial statements
and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.

 /s/ Wolf &
Company, P.C.

 We have served
as the Company's auditor since 2014.

 Boston, Massachusetts

 F- 2

BALANCE SHEETS

 SEPTEMBER
30, 2023 AND 2022

 2023

 2022

 ASSETS

 Current
 Assets:

 Cash
 and cash equivalents

 $
 26,480,928

 $
 41,711,690

 Prepaid
 expenses

 7,889,506

 2,852,580

 Total
 Current Assets

 34,370,434

 44,564,270

 Property
 and equipment, net

 1,432

 4,100

 lease right-of-use asset, net

 454,426

 646,074

 Other
 Assets:

 Deposits

 38,062

 38,062

 research and development

 59,400,000

 59,400,000

 Goodwill

 9,346,796

 9,346,796

 Total
 Other Assets

 68,784,858

 68,784,858

 Total
 Assets

 $
 103,611,150

 $
 113,999,302

 LIABILITIES
 AND STOCKHOLDERS' EQUITY

 Current
 Liabilities:

 Accounts
 payable

 $
 2,927,334

 $
 1,165,378

 Accrued
 expenses

 476,300

 1,405,394

 Accrued
 compensation

 2,156,983

 1,762,251

 lease liability

 218,380

 196,989

 Total
 Current Liabilities

 5,778,997

 4,530,012

 Deferred
 tax liability

 6,137,800

 5,561,800

 lease liability – non current

 262,865

 481,245

 Total
 Liabilities

 12,179,662

 10,573,057

 Commitments
 and Contingencies

 Stockholders'
 Equity:

 Preferred stock - $ 0.001 par value; 10,000,000 shares authorized; no shares issued and outstanding

 —

 —

 Common stock - $ 0.001 par value; 400,000,000 shares authorized; 158,857,798 and 146,211,130 shares issued and outstanding at September 30, 2023 and 2022, respectively

 158,858

 146,211

 Additional
 paid-in capital

 252,903,629

 232,368,121

 Accumulated
 deficit

 ( 162,231,379
)

 ( 129,688,467
)

 Total
 Citius Pharmaceuticals, Inc. Stockholders' Equity

 90,831,108

 102,825,865

 Non-controlling
 interest

 Total
 Equity

 91,431,488

 103,426,245

 Total
 Liabilities and Equity

 $
 103,611,150

 $
 113,999,302

 See
accompanying report of independent registered public accounting firm and notes to the financial statements.

 F- 3

STATEMENTS OF OPERATIONS

 FOR
THE YEARS ENDED SEPTEMBER 30, 2023 AND 2022

 2023

 2022

 Revenues

 $
 —

 $
 —

 Operating Expenses:

 and development

 14,819,729

 17,655,482

 General and administrative

 15,295,584

 11,754,609

 compensation – general and administrative

 Total
 Operating Expenses

 36,732,018

 33,316,045

 Loss

 ( 36,732,018
)

 ( 33,316,045
)

 Other Income:

 Interest income

 1,179,417

 251,399

 Gain
 on sale of New Jersey net operating losses

 3,585,689

 —

 Total
 Other Income

 4,765,106

 251,399

 Loss before Income Taxes

 ( 31,966,912
)

 ( 33,064,646
)

 Income tax expense

 Net Loss

)

)

 Deemed
 dividend on warrant extension

 1,151,208

 —

 Net
 Loss Applicable to Common Stockholders

 $
 ( 33,694,120
)

)

 Net Loss Per Share Applicable to Common Stockholders - Basic and Diluted

 $
 ( 0.22
)

 ( 0.23
)

 Weighted Average Common Shares Outstanding

 Basic and diluted

 151,294,729

 146,082,399

 See
accompanying report of independent registered public accounting firm and notes to the financial statements.

 F- 4

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

 FOR
THE YEARS ENDED SEPTEMBER 30, 2023 AND 2022

 Preferred

 Common
 Stock

 Additional

 Paid-In

 Accumulated

 Total Citius
 Pharmaceuticals, Inc.
 Shareholder's

 Non-Controlling

 Total

 Stock

 Shares

 Amount

 Capital

 Deficit

 Equity

 Interest

 Equity

 Balance,
 September 30, 2021

 $
 —

 145,979,429

 $
 145,979

 $
 228,084,195

 $
 ( 96,047,821
)

 $
 132,182,353

 $

 $
 132,782,733

 Issuance
 of common stock for services

 —

 231,701

 377,972

 —

 378,204

 —

 378,204

 compensation expense

 —

 —

 —

 —

 —

 Net
 loss

 —

 —

 —

 —

)

)

 —

)

 Balance,
 September 30, 2022

 —

 146,211,130

 146,211

 232,368,121

 ( 129,688,467
)

 102,825,865

 103,426,245

 Issuance
 of common stock for services

 —

 100,000

 101,900

 —

 102,000

 —

 102,000

 Issuance
 of common stock upon exercise of stock options

 —

 46,667

 31,220

 —

 31,267

 —

 31,267

 Issuance of common stock in registered direct offering, net of costs of $ 1,201,818

 —

 12,500,001

 12,500

 13,785,683

 —

 13,798,183

 —

 13,798,183

 compensation expense

 —

 —

 —

 —

 —

 Net
 loss

 —

 —

 —

 —

)

)

 —

)

 Balance,
 September 30, 2023

 $
 —

 158,857,798

 $
 158,858

 $
 252,903,629

 $
 ( 162,231,379
)

 $
 90,831,108

 $

 $
 91,431,488

 See
accompanying report of independent registered public accounting firm and notes to the financial statements.

 F- 5

STATEMENTS OF CASH FLOWS

 FOR
THE YEARS ENDED SEPTEMBER 30, 2023 AND 2022

 2023

 2022

 Cash Flows From Operating
 Activities:

 Net loss

 $
)

 $
)

 Adjustments to reconcile net loss to net cash
 used in operating activities:

 Stock-based compensation

 Issuance of common stock
 for services

 102,000

 378,204

 Amortization of operating
 lease right-of-use asset

 191,648

 176,754

 Depreciation

 2,668

 2,923

 Deferred income tax
 expense

 Changes in operating assets and liabilities:

 Prepaid expenses

 ( 5,036,926
)

 ( 111,176
)

 Accounts payable

 1,761,956

 ( 111,717
)

 Accrued expenses

 ( 929,094
)

 783,434

 Accrued compensation

 394,732

 ( 143,749
)

 lease liability

 ( 196,989
)

 ( 177,237
)

 Net
 Cash Used In Operating Activities

 ( 29,060,212
)

 ( 28,361,256
)

 Cash Flows From Financing
 Activities:

 Proceeds from common
 stock option exercises

 31,267

 —

 Net
 proceeds from registered direct offerings

 13,798,183

 —

 Net
 Cash Provided By Financing Activities

 13,829,450

 —

 Net Change in Cash and Cash
 Equivalents

 ( 15,230,762
)

 ( 28,361,256
)

 Cash
 and Cash Equivalents – Beginning of Year

 41,711,690

 70,072,946

 Cash
 and Cash Equivalents – End of Year

 $
 26,480,928

 $
 41,711,690

 See
accompanying report of independent registered public accounting firm and notes to the financial statements.

 F- 6

 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS

 FOR
THE YEARS ENDED SEPTEMBER 30, 2023 AND 2022

 1.
NATURE OF OPERATIONS AND BASIS OF PRESENTATION

 Business

Pharmaceuticals, Inc. ("Citius Pharma," the "Company" or "we") is a late-stage biopharmaceutical
company dedicated to the development and commercialization of critical care products with a focus on oncology, anti-infectives in adjunct
cancer care, unique prescription products and stem cell therapies.

 On
March 30, 2016, we acquired Leonard-Meron Biosciences, Inc. ("LMB") as a wholly-owned subsidiary. We acquired all the outstanding
stock of LMB by issuing shares of our common stock. The net assets acquired included identifiable intangible assets of $ 19,400,000 related
to in-process research and development. We recorded goodwill of $ 9,346,796 for the excess of the purchase price over the net assets acquired.

 On
September 11, 2020, we formed NoveCite, Inc. ("NoveCite"), a Delaware corporation, of which we own 75 % of the issued and
outstanding capital stock.

 On
August 23, 2021, we formed Citius Oncology, Inc. (formerly named Citius Acquisition Corp.) ("Citius Oncology"), as a wholly-owned
subsidiary in conjunction with the acquisition of LYMPHIR, which began operations in April 2022. On October 23, 2023, Citius Pharma and
Citius Oncology entered into an agreement and plan of merger and reorganization with TenX Keane Acquisition, and its wholly owned subsidiary,
TenX Merger Sub Inc., whereby TenX Merger Sub Inc. will merge with and into Citius Oncology, with Citius Oncology surviving as a wholly
owned subsidiary of TenX Keane Acquisition. The newly combined publicly traded company is to be named "Citius Oncology, Inc."
(see Note 11).

research and development ("IPR&D) consists of i) the $ 19,400,000 acquisition value of LMB's drug candidate (Mino-Lok),
which is an antibiotic solution used to treat catheter-related bloodstream infections and is expected to be amortized on a straight-line
basis over a period of eight years commencing upon revenue generation, and ii) the $ 40,000,000 acquisition value of the exclusive license
for LYMPHIR (denileukin diftitox), a late-stage oncology immunotherapy for the treatment of cutaneous T-cell lymphoma ("CTCL"),
a rare form of non-Hodgkin lymphoma and is expected to be amortized on a straight-line basis over a period of twelve years commencing
upon revenue generation.

 Goodwill
of $ 9,346,796 represents the value of LMB's industry relationships and its assembled workforce. Goodwill will not be amortized
but will be tested at least annually for impairment.

 Since
its inception, we have devoted substantially all our efforts to business planning, research and development, recruiting management and
technical staff, and raising capital. We are subject to a number of risks common to companies in the pharmaceutical industry including,
but not limited to, risks related to the development by the Company or its competitors of research and development stage products, regulatory
approval and market acceptance of its products, competition from larger companies, dependence on key personnel, dependence on key suppliers
and strategic partners, the Company's ability to obtain additional financing and the Company's compliance with governmental
and other regulations.

 Basis
of Presentation

 The
accompanying consolidated financial statements include the operations of Citius Pharmaceuticals, Inc., and its wholly-owned subsidiaries,
Citius Pharmaceuticals, LLC, LMB and Citius Oncology, and its majority-owned subsidiary NoveCite. NoveCite, was inactive until October
2020. Citius Oncology began operations in April 2022. All significant inter-company balances and transactions have been eliminated in
consolidation.

 F- 7

 2.
GOING CONCERN UNCERTAINTY AND MANAGEMENT'S PLAN

 The
accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business. The Company experienced negative cash flows from operations of
$ 29,060,212 and $ 28,361,256, for the years ended September 30, 2023 and 2022, respectively. The Company had working capital of approximately
$ 28.6 million at September 30, 2023. The Company estimates that its available cash resources will be sufficient to fund its operations
through August 2024 which raises substantial doubt about the Company's ability to continue as a going concern within one year after
the date that the accompanying consolidated financial statements are issued.

 The
Company has generated no operating revenue to date and has principally raised capital through the issuance of debt and equity instruments
to finance its operations. However, the Company's continued operations beyond August 2024, including its development plans for
LYMPHIR, Mino-Lok, Mino-Wrap, Halo-Lido and NoveCite, will depend on its ability to obtain regulatory approval to market LYMPHIR and/or
Mino-Lok and generate substantial revenue from the sale of LYMPHIR and/or Mino-Lok and on its ability to raise additional capital through
various potential sources, such as equity and/or debt financings, strategic relationships, or out-licensing of its product candidates.
However, the Company can provide no assurances on regulatory approval, commercialization, or future sales of LYMPHIR and/or Mino-Lok
or that financing or strategic relationships will be available on acceptable terms, or at all. If the Company is unable to raise sufficient
capital, find strategic partners or generate substantial revenue from the sale of LYMPHIR and/or Mino-Lok, there would be a material
adverse effect on its business. Further, the Company expects in the future to incur additional expenses as it continues to develop its
product candidates, including seeking regulatory approval, and protecting its intellectual property.

 3.
PATENT AND TECHNOLOGY LICENSE AGREEMENTS

and Technology License Agreement – Mino-Lok

 LMB
has a patent and technology license agreement with Novel Anti-Infective Therapeutics, Inc. ("NAT") to develop and commercialize
Mino-Lok on an exclusive, worldwide sub licensable basis, as amended. LMB pays an annual maintenance fee each June until commercial
sales of a product subject to the license commence. The Company recorded an annual maintenance fee expense of $ 90,000 in 2023 and 2022.

 LMB
will also pay annual royalties on net sales of licensed products, with royalties ranging from the mid-single digits to the low double
digits. In limited circumstances in which the licensed product is not subject to a valid patent claim and a competitor is selling a competing
product, the royalty rate is in the low- to mid-single digits. After a commercial sale is obtained, LMB must pay minimum aggregate annual
royalties of $ 100,000 in the first commercial year which is prorated for a less than 12-month period, increasing $ 25,000 per year to
a maximum of $ 150,000 annually. LMB must also pay NAT up to $ 1,100,000 upon achieving specified regulatory and sales milestones. Finally,
LMB must pay NAT a specified percentage of payments received from any sub-licensees.

 Unless
earlier terminated by NAT, based on the failure to achieve certain development and commercial milestones, the license agreement remains
in effect until the date that all patents licensed under the agreement have expired and all patent applications within the licensed patent
rights have been cancelled, withdrawn, or expressly abandoned.

and Technology License Agreement – Mino-Wrap

 On
January 2, 2019, we entered into a patent and technology license agreement with the Board of Regents of the University of Texas System
on behalf of the University of Texas M. D. Anderson Cancer Center ("Licensor"), whereby we in-licensed exclusive worldwide
rights to the patented technology for any and all uses relating to breast implants. We intend to develop a liquefying gel-based
wrap containing minocycline and rifampin for the reduction of infections associated with breast implants following breast reconstructive
surgeries ("Mino-Wrap"). We are required to use commercially reasonable efforts to commercialize Mino-Wrap under several
regulatory scenarios and achieve milestones associated with these regulatory options leading to an approval from the U.S. Food and Drug
Administration (the "FDA").

 F- 8

 Under
the license agreement, we paid an annual maintenance fee of $ 75,000 and $ 60,000 in January 2023 and 2022, respectively. The annual maintenance
fee increases by $15,000 per year up to a maximum of $90,000 and ceases on the first sale of product. We also must pay up to an aggregate
of $2.1 million in milestone payments, contingent on the achievement of various regulatory and commercial milestones. Under the terms
of the license agreement, we also must pay a royalty of mid- to upper-single digit percentages of net sales, depending on the amount
of annual sales, and subject to downward adjustment to lower- to mid-single digit percentages in the event there is no valid patent for
the product in the United States at the time of sale. After the first sale of product, we will owe an annual minimum royalty payment
of $100,000 that will increase annually by $25,000 for the duration of the term. We will be responsible for all patent expenses
incurred by Licensor for the term of the agreement although Licensor is responsible for filing, prosecution, and maintenance of all patents.
The agreement expires on the later of the expiration of the patents or January 2, 2034.

 License
Agreement with Eterna

 On
October 6, 2020, our subsidiary, NoveCite, signed an exclusive license agreement for a novel cellular therapy for acute respiratory distress
syndrome (ARDS) with a subsidiary of Novellus, Inc. ("Novellus"). Upon execution of the agreement, we paid $ 5,000,000 to
Novellus, which was charged to research and development expense during the year ended September 30, 2021, and issued Novellus shares
of NoveCite's common stock representing 25 % of the outstanding equity. We own the other 75 % of NoveCite's outstanding equity.
Pursuant to the terms of the original stock subscription agreement, if NoveCite issued additional equity, subject to certain exceptions,
NoveCite had to maintain Novellus's ownership at 25 % by issuing additional shares to Novellus.

 In
July 2021, Novellus was acquired by Brooklyn ImmunoTherapeutics, Inc. ("Brooklyn"). In connection with that transaction,
the stock subscription agreement was amended to assign to Brooklyn all of Novellus's right, title, and interest in the stock subscription
agreement and delete the anti-dilution protection and replace it with a right of first refusal whereby Brooklyn will have the right to
purchase all or a portion of the securities that NoveCite intends to sell or in the alternative, at the option of NoveCite, Brooklyn
may purchase that amount of the securities proposed to be sold by NoveCite to allow Brooklyn to maintain its then percentage ownership.
In October 2022, Brooklyn changed its name to Eterna Therapeutics Inc. ("Eterna").

is responsible for the operational activities of NoveCite and bears all costs necessary to operate NoveCite. Citius's officers
are also the officers of NoveCite and oversee the business strategy and operations of NoveCite. As such, NoveCite is accounted for as
a consolidated subsidiary with a noncontrolling interest.

 Eterna
has no contractual rights in the profits or obligations to share in the losses of NoveCite, and the Company has not allocated any losses
to the noncontrolling interest.

is obligated to pay Eterna up to $51,000,000 upon the achievement of various regulatory and developmental milestones. NoveCite also must
pay a royalty equal to low double-digit percentages of net sales, commencing upon the sale of a licensed product. This royalty is subject
to downward adjustment to an upper-single digit percentage of net sales in any country in the event of the expiration of the last valid
patent claim or if no valid patent claim exists in that country. The royalty will end on the earlier of (i) date on which a biosimilar
product is first marketed, sold, or distributed in the applicable country or (ii) the 10-year anniversary of the date of expiration of
the last-to-expire valid patent claim in that country. In the case of a country where no licensed patent ever exists, the royalty will
end on the later of (i) the date of expiry of such licensed product's regulatory exclusivity and (ii) the 10-year anniversary of
the date of the first commercial sale of the licensed product in the applicable country. In addition, NoveCite will pay to Eterna an
amount equal to a mid-twenties percentage of any sublicensee fees it receives.

 Under
the terms of the license agreement, if Eterna receives any revenue involving the original cell line included in the licensed technology,
then Eterna shall remit to NoveCite 50 % of such revenue.

 The
term of the license agreement continue on a country-by-country and licensed product-by-licensed product basis until the expiration of
the last-to-expire royalty term. Either party may terminate the license agreement upon written notice if the other party is in material
default. NoveCite may terminate the license agreement at any time without cause upon 90 days prior written notice.

 F- 9

 Eterna
will be responsible for preparing, filing, prosecuting, and maintaining all patent applications and patents included in the licensed
patents in the territory, provided however, that if Eterna decides that it is not interested in maintaining a particular licensed patent
or in preparing, filing, or prosecuting a licensed patent, NoveCite will have the right, but not the obligation, to assume such responsibilities
in the territory at NoveCite's sole cost and expense.

 License
Agreement with Eisai

 In
September 2021, the Company entered into an asset purchase agreement with Dr. Reddy's Laboratories SA, a subsidiary of Dr. Reddy's
Laboratories, Ltd. (collectively, "Dr. Reddy's") and a license agreement with Eisai Co., Ltd. ("Eisai")
to acquire an exclusive license of E7777 (denileukin diftitox), a late-stage oncology immunotherapy for the treatment of CTCL, a rare
form of non-Hodgkin lymphoma. We have obtained the trade name of LYMPHIR for E7777.

 Under
the terms of these agreements, we acquired Dr. Reddy's exclusive license for E7777 from Eisai and other related assets owned by
Dr. Reddy's. The exclusive license includes rights to develop and commercialize E7777 in all markets except for Japan and certain
parts of Asia. Additionally, we retained an option on the right to develop and market the product in India. Eisai retains exclusive development
and marketing rights for the agent in Japan and Asia. Citius Pharma paid $ 40 million upfront payment which represents the acquisition
date fair value of the in-process research and development acquired from Dr. Reddy's. Dr. Reddy's is entitled to up to $ 40
million in development milestone payments related to CTCL approvals in the U.S. and other markets, up to $ 70 million in development milestones
for additional indications, as well as commercial milestone payments and low double-digit tiered royalties on net product sales, and
up to $ 300 million for commercial sales milestones. We also must pay on a fiscal quarter basis tiered royalties equal to low double-digit
percentages of net product sales. The royalties will end on the earlier of (i) the 15-year anniversary of the first commercial sale of
the latest indication that received regulatory approval in the applicable country and (ii) the date on which a biosimilar product results
in the reduction of net sales in the applicable product by 50% in two consecutive quarters, as compared to the four quarters prior to
the first commercial sale of the biosimilar product. We will also pay to Dr. Reddy's an amount equal to a low-thirties percentage
of any sublicense upfront consideration or milestone payments (or the like) received by us and the greater of (i) a low-thirties percentage
of any sublicensee sales-based royalties or (ii) a mid-single digit percentage of such licensee's net sales.

 Under
the license agreement, Eisai is to receive a $6.0 million development milestone payment upon initial approval and additional commercial
milestone payments related to the achievement of net product sales thresholds (which increases to $7 million in the event we have exercised
our option to add India to the licensed territory prior to FDA approval) and an aggregate of up to $22 million related to the achievement
of net product sales thresholds. We also were required to reimburse Eisai for up to $2.65 million of its costs to complete the ongoing
Phase 3 pivotal clinical trial for LYMPHIR for the CTCL indication and reimburse Eisai for all reasonable costs associated with the preparation
of a Biologics License Application ("BLA") for LYMPHIR. Eisai was responsible for completing the CTCL clinical trial, and
chemistry, manufacturing, and controls (CMC) activities through the filing of a BLA for LYMPHIR with the FDA. The BLA was filed with
the FDA on September 27, 2022. We will also be responsible for development costs associated with potential additional indications.

 The
term of the license agreement will continue until (i) March 30, 2026, if there has not been a commercial sale of a licensed product in
the territory, or (ii) if there has been a first commercial sale of a licensed product in the territory by March 30. 2026, the 10-year
anniversary of the first commercial sale on a country-by-country basis. The term of the license may be extended for additional 10-year
periods for all countries in the territory by notifying Eisai and paying an extension fee equal to $10 million. Either party may terminate
the license agreement upon written notice if the other party is in material breach of the agreement, subject to cure within the designated
time periods. Either party also may terminate the license agreement immediately upon written notice if the other party files for bankruptcy
or takes related actions or is unable to pay its debts as they become due. Additionally, either party will have the right to terminate
the agreement if the other party directly or indirectly challenges the patentability, enforceability or validity of any licensed patent.

 Also
under the asset purchase agreement with Dr. Reddy's, we are required to (i) use commercially reasonable efforts to make commercially
available products in the CTCL indication, peripheral T-cell lymphoma indication and immuno-oncology indication, (ii) initiate two investigator
initiated immuno-oncology trials, (iii) use commercially reasonable efforts to achieve each of the approval milestones, and (iv) to complete
each specified immuno-oncology investigator trial on or before the four-year anniversary of the effective date of the definitive agreement.
Additionally, we are required to commercially launch a product in a territory within six months of receiving regulatory approval for
such product in each such jurisdiction.

 F- 10

 On
July 29, 2023, we received a Complete Response Letter, ("CRL") from the FDA regarding the BLA seeking approval for LYMPHIR.
The FDA has required that we incorporate enhanced product testing, and additional controls agreed to with the FDA during the market application
review. The FDA raised no concerns relating to the safety and efficacy clinical data package.

 On
September 8, 2023, we announced that the FDA agreed with our plans to address the requirements outlined in the CRL. The guidance from
the FDA provides a path for completing the necessary activities to support the resubmission of the BLA. No additional clinical efficacy
or safety trials have been requested by FDA for the resubmission. Based on the feedback from the FDA, we plan to complete the CRL remediation
activities by the end of 2023 and file the resubmission in early 2024.

 4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 A
summary of the significant accounting policies followed by the Company in the preparation of the consolidated financial statements is
as follows:

 Use
of Estimates

 The
process of preparing financial statements in conformity with accounting principles generally accepted in the United States of America
("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and expenses
during the reporting period. Estimates having relatively higher significance include the accounting for in-process research and development
and goodwill impairment, stock-based compensation, valuation of warrants, and income taxes. Actual results could differ from those estimates
and changes in estimates may occur.

 Cash
and Cash Equivalents

 The
Company considers all highly liquid instruments with maturities of less than three months at the time of purchase to be cash equivalents.
From time to time, the Company may have cash balances in financial institutions in excess of insurance limits. The Company has never
experienced any losses related to these balances.

 Prepaid Expenses

 Prepaid expenses at September
30, 2023 and 2022 consist of $ 154,611 and $ 162,398 of prepaid insurance, respectively, and $ 7,734,895 and $ 2,690,182 of advance payments
made for the preparation of long-lead time drug substance and product costs, respectively, which will be utilized in research and development
activities or in the manufacturing of LYMPHIR for sales upon approval.

and Development

and development costs, including upfront fees and milestones paid to collaborators who are performing research and development activities
under contractual agreements with the Company, are expensed as incurred. The Company defers and capitalizes its nonrefundable advance
payments that are for research and development activities until the related goods are delivered or the related services are performed.
When the Company is reimbursed by a collaboration partner for work the Company performs, it records the costs incurred as research and
development expenses and the related reimbursement as a reduction to research and development expenses in its consolidated statement
of operations. Research and development expenses primarily consist of clinical and non-clinical studies, materials and supplies, third-party
costs for contracted services, and payments related to external collaborations and other research and development related costs.

Research and Development and Goodwill

research and development of $ 19,400,000 represents the value of LMB's drug candidate (Mino-Lok), which is an antibiotic solution
used to treat catheter-related bloodstream infections and is expected to be amortized on a straight-line basis over a period of eight
years commencing upon revenue generation.

 F- 11

research and development of $ 40,000,000 represents the value of our September 2021 acquisition of an exclusive license for LYMPHIR (denileukin
diftitox), a late-stage oncology immunotherapy for the treatment of CTCL, a rare form of non-Hodgkin lymphoma and is expected to be amortized
on a straight-line basis over a period of twelve years commencing upon revenue generation. Included in the IPR&D is the historical
know-how, formula protocols, designs, and procedures expected to be needed to complete Phase 3. In addition, the contracts acquired in
connection with Dr. Reddy's transaction with the clinical research and manufacturing organization are at market rates and could
be provided by multiple vendors in the marketplace. Therefore, there is no fair value associated with the contracts acquired.

 Incremental
costs incurred on IPR&D after the acquisition date are expensed as incurred, unless there is an alternative future use.

 The
Company reviews intangible assets annually to determine if any adverse conditions exist or a change in circumstances has occurred that
would indicate impairment or a change in the remaining useful life of any intangible asset. If the carrying value of an asset exceeds
its undiscounted cash flows, the Company writes down the carrying value of the intangible asset to its fair value in the period identified.
No impairment has occurred since the acquisitions through September 30, 2023.

 Goodwill
represents the value of LMB's industry relationships and its assembled workforce. Goodwill is not amortized but it is tested at
least annually for impairment.

 The
Company evaluates the recoverability of goodwill annually or more frequently if events or changes in circumstances indicate that the
carrying value of an asset might be impaired, in accordance with Accounting Standard Update ("ASU") 2017-04, Intangibles
– Goodwill and Other (Topic 350): Simplifying the Accounting for Goodwill Impairment issued by the Financial Accounting Standards
Bureau ("FASB"). Goodwill is first qualitatively assessed to determine whether further impairment testing is necessary. Factors
that management considers in this assessment include macroeconomic conditions, industry and market considerations, overall financial
performance (both current and projected), changes in management and strategy and changes in the composition or carrying amount of net
assets. If this qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit is less than
its carrying amount, a one-step test is then performed in accordance with ASU 2017-04. Under the simplified model, a goodwill impairment
is calculated as the difference between the carrying amount of the reporting unit and its fair value.

 The
Company performed a qualitative assessment for its 2023 analysis of goodwill. Based on this assessment, management does not believe that
it is more likely than not that the carrying value of the reporting unit exceeds its fair value. Accordingly, no further testing was
performed as management believes that there are no impairment issues with respect to goodwill as of September 30, 2023.

 Patents
and Trademarks

 Certain
costs of outside legal counsel related to obtaining trademarks for the Company are capitalized. Patent costs are amortized over the legal
life of the patents, generally twenty years, starting at the patent issuance date. There are no capitalized patents and trademarks as
of September 30, 2023.

 The
costs of unsuccessful and abandoned applications are expensed when abandoned. The costs of maintaining existing patents are expensed
as incurred.

 Stock-Based
Compensation

 The
Company recognizes compensation costs resulting from the issuance of stock-based awards to employees and directors as an expense in the
consolidated statement of operations over the requisite service period based on the fair value for each stock award on the grant date.
The fair value of each option grant is estimated as of the date of grant using the Black-Scholes option pricing model. The Company estimates
volatility using the trading activity of its common stock. Because the Company's stock options have characteristics significantly
different from those of traded options, and because changes in the input assumptions can materially affect the fair value estimate, the
existing model may not necessarily provide a reliable single measure of fair value of the Company's stock options.

 F- 12

 The
Company recognizes compensation costs resulting from the issuance of stock-based awards to non-employees as an expense in the consolidated
statement of operations over the service period based on the measurement of fair value for each stock award and records forfeitures as
they occur.

 Income
Taxes

 The
Company follows accounting guidance regarding the recognition, measurement, presentation, and disclosure of uncertain tax positions in
the consolidated financial statements. Tax positions taken or expected to be taken in the course of preparing the Company's tax
returns are required to be evaluated to determine whether the tax positions are "more-likely-than-not" of being sustained
by the applicable tax authorities. Tax positions not deemed to meet a more-likely-than-not threshold would be recorded in the consolidated
financial statements. There are no uncertain tax positions that require accrual or disclosure as of September 30, 2023. Any interest
or penalties are charged to expense. During the years ended September 30, 2023 and 2022, the Company did not recognize any interest and
penalties. Tax years subsequent to September 30, 2019 are subject to examination by federal and state authorities.

 The
Company recognizes deferred tax assets and liabilities based on differences between the financial reporting and tax basis of assets and
liabilities, and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the enacted tax
rates and laws that are expected to be in effect when the differences are expected to reverse. The Company provides a valuation allowance,
if necessary, for deferred tax assets for which it does not consider realization of such assets to be "more-likely-than-not."
The deferred tax benefit or expense for the period represents the change in the deferred tax asset or liability from the beginning to
the end of the period.

 Basic
and Diluted Net Loss per Common Share

 Basic
and diluted net loss per common share applicable to common stockholders is computed by dividing net loss applicable to common stockholders
in each period by the weighted average number of shares of common stock outstanding during such period. For the periods presented, common
stock equivalents, consisting of options and warrants were not included in the calculation of the diluted loss per share because they
were anti-dilutive.

 Segment
Reporting

 The
Company currently operates as a single segment.

 Concentrations
of Credit Risk

 The
Company has no significant off-balance-sheet concentration of credit risk such as foreign exchange contracts, option contracts or other
hedging arrangements.

 Recently
Issued Accounting Standards

 In
October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Acquired Contract Assets and
Contract Liabilities. Under the new guidance (ASC 805-20-30-28), the acquirer should determine what contract assets and/or contract
liabilities it would have recorded under Accounting Standards Codification ("ASC") 606 (the revenue guidance) as of the acquisition
date, as if the acquirer had entered into the original contract at the same date and on the same terms as the acquiree. The recognition
and measurement of those contract assets and contract liabilities will likely be comparable to what the acquiree has recorded on its
books under ASC 606 as of the acquisition date. ASU 2021-08 is effective for fiscal years beginning after December 15, 2022, including
interim periods within those fiscal years. ASU 2021-08 is effective for the Company in the first quarter of fiscal year 2024. Early adoption
is permitted, including in an interim period, for any period for which financial statements have not yet been issued. However, adoption
in an interim period other than the first fiscal quarter requires an entity to apply the new guidance to all prior business combinations
that have occurred since the beginning of the annual period in which the new guidance is adopted. The Company is currently evaluating
the adoption date of ASU 2021-08 and the impact, if any, adoption will have on its financial position and results of operations.

 F- 13

 5.
COMMON STOCK, STOCK OPTIONS AND WARRANTS

 Common
Stock Issued for Services

 On
November 2, 2021, the Company issued 50,201 shares of common stock for investor relations services and expensed the $ 95,884 fair value
of the common stock issued.

 On
March 21, 2022, the Company issued 100,000 shares of common stock for media, public and investor relations services and expensed the
$ 178,000 fair value of the common stock issued.

 On
September 13, 2022, the Company issued 81,500 shares of common stock for media, public and investor relations services and expensed the
$ 104,320 fair value of the common stock issued.

 On
March 27, 2023, the Company issued 100,000 shares of common stock for media, public and investor relations services and expensed the
$ 102,000 fair value of the common stock issued.

 Common
Stock Offering

 On
May 8, 2023, the Company closed a registered direct offering of 12,500,001 common shares and warrants to purchase up to 12,500,001 common
shares, at a purchase price of $ 1.20 per share and accompanying warrant for gross proceeds of $ 15,000,001. The warrants have an exercise
price of $ 1.50 per share, are exercisable six months from the date of issuance, and expire five years from the date of issuance. The
estimated fair value of the warrants issued to the investors was approximately $ 11,000,000.

 Net
proceeds were $ 13,798,183 after deducting the placement agent fee of $ 1,050,000, placement agent expenses of $ 85,000, legal fees of $ 50,868,
and other offering expenses of $ 15,950. The Company also issued 875,000 warrants to the placement agent at an exercise price of $ 1.50
per share, that are exercisable six months from the date of issuance, and expire five years from the date of issuance. The estimated
fair value of the warrants issued to the placement agent was approximately $ 771,000.

 Stock
Option Plans

to our 2014 Stock Incentive Plan, we reserved 866,667 shares of common stock. As of September 30, 2023, there were options to purchase
 795,171 shares outstanding, options to purchase 4,829 shares were exercised, options to purchase 66,667 shares expired, and no shares
were available for future grants.

to our 2018 Omnibus Stock Incentive Plan, we reserved 2,000,000 shares of common stock. As of September 30, 2023, there were options
to purchase 1,760,000 shares outstanding, options to purchase 116,667 shares were exercised, options to purchase 13,333 shares expired,
and the remaining 110,000 shares were transferred to the 2020 Omnibus Stock Incentive Plan ("2020 Plan").

to our 2020 Plan, we reserved 3,110,000 shares of common stock. As of September 30, 2023, there were options to purchase 1,820,000 shares
outstanding, options to purchase 50,000 shares expired and the remaining 1,240,000 shares were transferred to the 2021 Omnibus Stock
Incentive Plan ("2021 Stock Plan").

to our 2021 Stock Plan, we reserved 8,740,000 shares of common stock. As of September 30, 2023, options to purchase 8,630,000 shares
were outstanding, options to purchase 75,000 shares expired and the remaining 35,000 shares were transferred to the 2023 Omnibus Stock
Incentive Plan ("2023 Stock Plan").

 In
November 2022, our Board approved the 2023 Stock Plan, subject to stockholder approval, which was received on February 7, 2023. The 2023
Stock Plan has reserved for issuance 12,035,000 shares of common stock. As of September 30, 2023, options to purchase 300,000 shares
were outstanding and 11,735,000 shares remain available for future grants.

 F- 14

 The
fair value of each stock option award is estimated on the date of grant using the Black-Scholes option pricing model. Volatility is estimated
using the trading activity of our common stock. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the
time of grant commensurate with the expected term assumption. The expected term of stock options granted to employees and directors,
all of which qualify as "plain vanilla," is based on the average of the contractual term (generally 10 years) and the
vesting period. For non-employee options, the expected term is the contractual term.

 The
following assumptions were used in determining the fair value of stock option grants for the years ended September 30, 2023 and 2022:

 2023

 2022

 Risk-free
 interest rate

 3.52 – 4.14 %

 1.05 – 2.94 %

 Expected
 dividend yield

 0.00 %

 0.00 %

 Expected
 term

 5.50 – 10 years

 6.50 – 10 years

 Expected
 volatility

 89 – 90 %

 94 – 110 %

 A
summary of option activity under the Citius Pharma plans (excluding the NoveCite and Citius Oncology Stock Plans) is presented below:

 Option

 Shares

 Weighted-

 Average
 Exercise
 Price

 Weighted-

 Average
 Remaining
 Contractual
 Term

 Aggregate

 Intrinsic
 Value

 Outstanding
 at September 30, 2022

 9,400,171

 $
 2.07

 7.81 years

 $
 869,509

 Granted

 4,150,000

 1.26

 Exercised

 ( 46,667
)

 0.67

 34,067

 Forfeited
 or expired

 ( 198,333
)

 3.91

 Outstanding
 at September 30, 2023

 13,305,171

 $
 1.79

 7.41 years

 $
 56,203

 Exercisable
 at September 30, 2023

 6,558,507

 $
 2.09

 6.19 years

 $
 56,203

 The
weighted average grant date fair value of the options granted during the year ended September 30, 2022 was estimated at $ 1.67 per share.
All these options vest over terms of 12 to 36 months and have a term of 10 years.

 The
weighted average grant date fair value of the options granted during the year ended September 30, 2023 was estimated at $ 0.98 per share.
All these options vest over terms of 12 to 36 months and have a term of 10 years.

compensation expense for the years ended September 30, 2023 and 2022 was $ 6,616,705 (including $ 130,382 for the NoveCite plan and $ 1,965,500
for the Citius Oncology plan) and $ 3,905,954 (including $ 133,332 for the NoveCite plan), respectively.

 At
September 30, 2023, unrecognized total compensation cost related to unvested awards under the Citius stock plans of $ 4,840,874 is expected
to be recognized over a weighted average period of 1.53 years.

Stock Plan – Under the NoveCite Stock Plan, we reserved 2,000,000 common shares of NoveCite. As of September 30, 2023,
there were options outstanding to purchase 1,911,500 common shares of NoveCite and 88,500 common shares of NoveCite available for future
grants.

the year ended September 30, 2021, NoveCite granted options to purchase 2,000,000 common shares to employees at a weighted average
exercise price of $ 0.24 per share, of which options to purchase 88,500 common shares were forfeited, and options to purchase
 1,673,625 common shares were exercisable as of September 30, 2023. These options vest over 36 months and have a term of 10 years.
The weighted average remaining contractual term of options outstanding under the NoveCite Stock Plan is 7.39 years. No options were
issued in fiscal years 2023 and 2022. At September 30, 2023, unrecognized total compensation cost related to unvested awards under
the NoveCite Stock Plan of $ 47,575 is expected to be recognized over a weighted average period of 0.67 years.

 F- 15

Oncology Stock Plan - Under the Citius Oncology Stock Plan, adopted on April 29, 2023, we reserved 15,000,000 common shares of
Citius Oncology. The Citius Oncology Stock Plan provides incentives to employees, directors, and consultants through grants of options,
SARs, dividend equivalent rights, restricted stock, restricted stock units, or other rights.

the year ended September 30, 2023, Citius Oncology granted options to purchase 12,750,000 common shares at a weighted average price of
$ 2.15 per share, of which options to purchase 150,000 common shares were forfeited and options to purchase 655,556 common shares were
exercisable at September 30, 2023. The weighted average grant date fair value of the options granted during the year ended September
30, 2023 was estimated at $ 1.65 per share. These options vest over periods from 12 to 36 months and have a term of 10 years. The weighted
average remaining contractual term of options outstanding under the Citius Oncology Stock Plan is 9.77 years. At September 30, 2023,
unrecognized total compensation cost related to unvested awards under the Citius Oncology Stock Plan of $ 18,882,500 is expected to be
recognized over a weighted average period of 2.64 years.

 Warrants

 The
Company has reserved 50,923,819 shares of common stock for the exercise of outstanding warrants. The following table summarizes the warrants
outstanding at September 30, 2023:

 Exercise

 price

 Expiration
 Dates

 March
 2018 Registered Direct/Private Placement Investors

 $
 2.86

 218,972

 October 2, 2023

 August 2018 Offering Investors

 1.15

 3,921,569

 August 14, 2024

 August 2018 Offering Agent

 1.59

 189,412

 August 8, 2024

 April
 2019 Registered Direct/Private Placement Investors

 1.42

 1,294,498

 April 5, 2024

 April
 2019 Registered Direct/Private Placement Agent

 1.93

 240,130

 April 5, 2024

 September 2019 Offering
 Investors

 0.77

 2,793,297

 September 27, 2024

 September 2019 Offering
 Underwriter

 1.12

 194,358

 September 27, 2024

 February 2020 Exercise
 Agreement Placement Agent

 1.28

 138,886

 August 19, 2025

 May 2020
 Registered Direct Offering Investors

 1.00

 1,670,588

 November 18, 2025

 May 2020
 Registered Direct Offering Placement Agent

 1.33

 155,647

 May 14, 2025

 August 2020 Underwriter

 1.31

 201,967

 August 10, 2025

 January
 2021 Registered Direct Offering Investors

 1.23

 3,091,192

 July 27, 2026

 January
 2021 Registered Direct Offering Agent

 1.62

 351,623

 July 27, 2026

 February 2021 Offering
 Investors

 1.70

 20,580,283

 February 19, 2026

 February 2021 Offering
 Agent

 1.88

 2,506,396

 February 19, 2026

 May 2023
 Registered Direct Offering Investors

 1.50

 12,500,001

 May 8, 2028

 May
 2023 Registered Direct Offering Agent

 1.50

 875,000

 May 3, 2028

 50,923,819

 On
August 8, 2023, we extended the term by one year to August 14, 2024 for 3,921,569 warrants for common stock with an exercise price
of $ 1.15 per share and extended the term by one year to August 8, 2024 for 189,412 warrants with an exercise price of $ 1.59 per
share. We recorded a deemed dividend of $ 1,151,208 based on the excess of the fair value of the modified warrants over the fair
value of the warrants before the modification, the effect of which was an increase in the net
loss attributable to common shareholders in the statement of operations for the year ended September 30, 2023.

 At
September 30, 2023, the weighted average remaining life of the outstanding warrants is 2.72 years, all warrants are exercisable, and
there was no aggregate intrinsic value for the warrants outstanding.

 F- 16

 Common
Stock Reserved

 A summary
of common stock reserved for future issuances as of September 30, 2023 is as follows:

 Stock plan options outstanding

 13,305,171

 Stock plan shares available for future grants

 11,735,000

 Warrants outstanding

 50,923,819

 Total

 75,963,990

 6.
RELATED PARTY TRANSACTIONS

 On
August 8, 2023, we extended the term by one year for 3,921,569 warrants held by our Chairman and by our Executive Vice Chairman (see
Note 5).

 7.
EMPLOYMENT AGREEMENTS

 Employment
Agreements

 On
October 19, 2017, the Company and its Chairman of the Board, Leonard Mazur, entered into an employment agreement with a three-year term.
Upon expiration, the agreement automatically renews for successive periods of one-year unless terminated pursuant to its terms. Under
the terms of the agreement, the Company is required to pay base compensation plus incentives over the employment term plus severance
benefits upon the occurrence of certain events as described in the agreement.

 On
November 27, 2017, the Company entered into an employment agreement with Jaime Bartushak to serve as the Chief Financial Officer and
Principal Financial Officer of the Company. The agreement requires the Company to pay base compensation plus incentives over the employment
term plus severance benefits upon the occurrence of certain events as described in the agreement.

 On
April 12, 2022, we entered into an 18-month employment agreement with Myron Holubiak to serve as Executive Vice Chairman. Upon expiration,
the agreement automatically renews for successive periods of one-year unless terminated pursuant to its terms. The agreement requires
the Company to pay base compensation plus incentives over the employment term plus severance benefits upon the occurrence of certain
events as described in the agreement.

 On
July 13, 2020, we entered into an employment agreement with Myron Czuczman, M.D. to serve as Executive Vice President, Chief Medical
Officer. The agreement requires the Company to pay base compensation plus incentives over the employment term plus severance benefits
upon the occurrence of certain events as described in the agreement.

 The
Company has employment agreements with certain other employees that require the Company to pay base compensation plus incentives over
the employment term plus severance benefits upon the occurrence of certain events as described in the agreement.

 8.
COMMITMENTS AND CONTINGENCIES

Lease

 Effective
July 1, 2019, we entered into a 76-month lease for office space in Cranford, NJ. We pay our proportionate share of real estate taxes
and operating expenses in excess of the base year expenses. These costs are variable lease payments and are not included in the determination
of the lease's right-of-use asset or lease liability.

 We
identified and assessed the following significant assumptions in recognizing its right-of-use assets and corresponding lease liabilities:

 As the Cranford lease does
 not provide an implicit rate, the Company estimated the incremental borrowing rate in calculating the present value of the lease
 payments. The Company has estimated its incremental borrowing rate based on the remaining lease term as of the adoption date.

 F- 17

 Since the Company elected
 to account for each lease component and its associated non-lease components as a single combined component, all contract consideration
 was allocated to the combined lease component.

 The expected lease terms
 include noncancelable lease periods.

 The
elements of lease expense are as follows:

 Lease cost

 Year
 Ended
 2023

 Year
 Ended
 2022

 Operating lease cost

 $
 238,824

 $
 238,822

 Variable lease cost

 4,771

 Total lease cost

 $
 243,595

 $
 239,594

 Other information

 Weighted-average remaining lease term - operating
 leases

 2.1 Years

 3.1 Years

 Weighted-average discount rate - operating
 leases

 8.0
 %

 8.0
 %

 Maturities
of lease liabilities due under the Company's non-cancellable leases are as follows:

 Year Ending

 2024

 $
 249,024

 2025

 253,883

 2026

 21,460

 Total
 lease payments

 524,367

 Less:
 interest

 ( 43,122
)

 Present
 value of lease liabilities

 $
 481,245

 Leases

 Classification

 2023

 2022

 Assets

 Lease asset

 $
 454,426

 $
 646,074

 Total
 lease assets

 $
 454,426

 $
 646,074

 Liabilities

 Current

 $
 218,380

 $
 196,989

 Non-current

 262,865

 481,245

 Total
 lease liabilities

 $
 481,245

 $
 678,234

 Interest
expense on the lease liability was $ 47,176 and $ 62,068 for the years ended September 30, 2023 and 2022, respectively.

 Legal
Proceedings

 The
Company is not involved in any litigation that it believes could have a material adverse effect on its financial position or results
of operations. There is no action, suit, proceeding, inquiry, or investigation before or by any court, public board, government agency,
self-regulatory organization or body pending or, to the knowledge of the Company's executive officers, threatened against or affecting
the Company or its officers or directors in their capacities as such.

 F- 18

 9.
GAIN ON SALE OF NEW JERSEY NET OPERATING LOSSES

 The
Company recognized a gain of $ 3,585,689 for the year ended September 30, 2023 in connection with the sale of certain New Jersey income
tax net operating losses to a third party under the New Jersey Technology Business Tax Certificate Transfer Program.

 10.
INCOME TAXES

 The
Company recorded deferred income tax expense of $ 576,000 for the both the years ended September 30, 2023 and 2022 related to the amortization
for taxable purposes of its in-process research and development asset.

 The
income tax expense (benefit) differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax
income for the years ended September 30, 2023 and 2022 due to the following:

 2023

 2022

 Computed "expected"
 tax benefit

 ( 21.0
)%

 ( 21.0
)%

 Increase (decrease) in income taxes resulting
 from:

 State taxes, net of federal benefit

 ( 6.3
)

 ( 6.3
)

 Permanent differences

 3.7

 1.8

 Increase in the
 valuation reserve

 25.4

 27.2

 1.8
 %

 1.7
 %

 Deferred
income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets and
liabilities are as follows:

 2023

 2022

 Deferred tax assets:

 Net operating loss carryforward

 $
 34,980,000

 $
 34,673,000

 Stock-based compensation

 2,191,000

 1,569,000

 Capitalized research and development

 3,644,000

 Other

 4,100,000

 3,689,000

 Valuation allowance
 on deferred tax assets

 ( 44,915,000
)

 ( 39,931,000
)

 Total
 deferred tax assets

 —

 —

 Deferred tax liabilities:

 In-process research
 and development

 ( 6,137,800
)

 ( 5,561,800
)

 Total
 deferred tax liability

 ( 6,137,800
)

 ( 5,561,800
)

 Net
 deferred tax liability

 $
 ( 6,137,800
)

 $
 ( 5,561,800
)

 The
Company has recorded a valuation allowance against deferred tax assets as the utilization of the net operating loss carryforward and
other deferred tax assets is uncertain. During the years ended September 30, 2023 and 2022, the valuation allowance increased by $ 4,984,000
and $ 10,754,000, respectively. The increase in the valuation allowance during the years ended September 30, 2023 and 2022 was primarily
due to the Company's net operating loss. At September 30, 2023, the Company has a federal net operating loss carryforward
of approximately $ 133,000,000. Federal net operating loss carryforwards of approximately $ 35,000,000 begin expiring in 2034 and carryforwards
of approximately $ 98,000,000 generated in tax years beginning after 2017 may be carried forward indefinitely.

 As
of September 30, 2023, the Company also has estimated federal research and development credits of $ 3,511,000 to offset future income
taxes. The tax credit carryforwards will begin to expire in 2036.

 The
Company accounts for uncertain tax positions in accordance with the guidance provided in ASC 740, "Accounting for Income Taxes."
This guidance describes a recognition threshold and measurement attribute for the financial statement disclosure of tax positions taken
or expected to be taken in a tax return and requires recognition of tax benefits that satisfy a more-likely-than-not threshold. ASC 740
also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods and disclosure. There
have been no reserves for uncertain tax positions recorded by the Company to date.

 F- 19

 11.
NASDAQ LISTING

 On
September 12, 2023, we received a notification letter from the Nasdaq Stock Market LLC ("Nasdaq") indicating that we were
not in compliance with Nasdaq Listing Rule 5550(a)(2) because the minimum bid price of our common stock on the Nasdaq Capital Market
closed below $ 1.00 per share for 30 consecutive business days. In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company has
a compliance period of 180 calendar days, or until March 11, 2024, to regain compliance with the Bid Price Rule. If at any time before
March 11, 2024, the bid price of the Company's common stock closes at $ 1.00 per share or more for a minimum of ten consecutive
business days, Nasdaq will provide the Company with a written confirmation of compliance with the Bid Price Rule. If the Company does
not regain compliance with the Bid Price Rule by March 11, 2024, the Company may be eligible for an additional 180-day compliance period.
To qualify, the Company would be required to meet the continued listing requirement for market value of publicly held shares and all
other initial listing standards for the Nasdaq Capital Market, with the exception of the Bid Price Rule, and would need to provide written
notice of its intention to cure the bid price deficiency during the second compliance period by effecting a reverse stock split, if necessary.

 12.
SUBSEQUENT EVENTS

 Merger
Agreement - On October 23, 2023, Citius Pharma and Citius Oncology entered into an agreement and plan of merger and reorganization
(the "Merger Agreement") with TenX Keane Acquisition, a Cayman Islands exempted company ("TenX"), and TenX Merger
Sub Inc., a Delaware corporation, and a wholly owned subsidiary of TenX ("Merger Sub"). The Merger Agreement provides, among
other things, (i) on the terms and subject to the conditions set forth therein, that Merger Sub will merge with and into Citius Oncology,
with Citius Oncology surviving as a wholly owned subsidiary of TenX (the "Merger"), and (ii) that prior to the effective
time of the Merger (the "Effective Time"), TenX will migrate to and domesticate as a Delaware corporation in accordance with
Section 388 of the General Corporation Law of the State of Delaware and the Cayman Islands Companies Act (As Revised) (the "Domestication").
The newly combined publicly traded company is to be named "Citius Oncology, Inc." (the "Combined Company"). The
Domestication, Merger and the other transactions contemplated by the Merger Agreement are referred to as the "Business Combination."

 In
the Merger, all shares of Citius Oncology would be converted into the right to receive common stock of the Combined Company. As a result,
upon closing, Citius Pharma would receive 67.5 million shares of common stock of the Combined Company. As part of the transaction, Citius
Pharma will contribute $ 10 million in cash to the Combined Company. The 12.6 million existing Citius Oncology common stock options will
be assumed by the Combined Company. Citius Pharma and the Combined Company will also enter into an amended and restated shared services
agreement, which, among other things, will govern certain management and scientific services that Citius Pharma will continue to provide
to the Combined Company following the Effective Time.

 The
Merger Agreement, Business Combination and the transactions contemplated thereby were unanimously approved by the boards of directors
of each of Citius Pharma, Citius Oncology and TenX. The transaction is expected to be completed in the first half of 2024, subject to
approval by stockholders of TenX and other customary closing conditions, including final regulatory approvals and SEC filings. There
can be no assurance regarding the ultimate timing of the proposed transaction or that the transaction will be completed at all.

 On December 11, 2023, the Company terminated the Mino-Wrap license
agreement with the Board of Regents of the University of Texas System on behalf of MDACC.

 In late December 2023, the Company determined that patient enrollment
for the Mino-Lok trial was complete and that it would begin site shutdown activities.

 F- 20

 Item
9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 None.

 Item
9A. Controls and Procedures

 Disclosure
Controls and Procedures

 We
maintain disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports
filed under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is recorded, processed, summarized, and
reported within the specified time periods and accumulated and communicated to our management, including our principal executive officer
and principal financial officer, as appropriate to allow timely decisions regarding disclosure.

 Our
Chief Executive Officer (who is our principal executive officer) and Chief Financial Officer (who is our principal financial officer
and principal accounting officer), evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e)
and 15d-15(e) promulgated under the Exchange Act) as of September 30, 2023, the end of our fiscal year. In designing and evaluating disclosure
controls and procedures, we recognize that any disclosure controls and procedures, no matter how well designed and operated, can only
provide reasonable assurance of achieving the desired control objective. As of September 30, 2023, based on the evaluation of these disclosure
controls and procedures, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures
were effective in ensuring that information required to be disclosed by us in reports that we file or submit under the Exchange Act is
recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms.

 Management's
Annual Report on Internal Control over Financial Reporting

 Our
management is responsible for establishing and maintaining effective internal control over financial reporting as defined in Rule 13a-15(f)
under the Exchange Act. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute
assurance that a misstatement of our financial statements would be prevented or detected. Under the supervision of our Chief Executive
Officer and Chief Financial Officer, the Company conducted an evaluation of the effectiveness of our internal control over financial
reporting as of September 30, 2023 using the criteria established in Internal Control— Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission ("COSO") (2013 Framework).

 Based
on this evaluation, management has concluded that our internal controls were effective and that we maintained effective controls over
our financial reporting as of September 30, 2023.

 Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of
any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 Changes
in Internal Controls over Financial Reporting

 There
were no changes in our internal controls over financial reporting during the fourth quarter of fiscal 2023 that materially affected,
or are reasonably likely to materially affect, our internal control over financial reporting.

 Item
9B. Other Information.

 None.

 Item
9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

 Not applicable.

 PART
III

 Item
10. Directors, Executive Officers and Corporate Governance

 We
have adopted a written Code of Ethics and Business Conduct that applies to our directors, officers, and all employees. We intend to disclose
any amendments to, or waivers from, our code of ethics and business conduct that are required to be publicly disclosed pursuant to rules
of the SEC by filing such amendment or waiver with the SEC. This code of ethics and business conduct can be found in the "Investors
- Corporate Governance" section of our website, www.citiuspharma.com.

 The
other information required by this Item concerning our directors and executive officers is incorporated by reference to the section captioned
"Proposal No. 1—Election of Directors" and "Corporate Governance" to be contained in our proxy statement
related to the 2024 Annual Meeting of Stockholders (the "Proxy Statement"), which information is expected to be filed with
the SEC within 120 days of the end of our fiscal year pursuant to General Instruction G(3) of Form 10-K. The information required by
this Item concerning compliance with Section 16(a) of the Exchange Act by our directors, executive officers and persons who own more
than 10% of our outstanding common stock is incorporated by reference from the section captioned "Section 16(a) Beneficial Ownership
Reporting Compliance" to be contained in the Proxy Statement.

 Item
11. Executive Compensation

 The
information required by this Item concerning directors and executive compensation is incorporated by reference from the sections captioned
"Director Compensation" and "Executive Compensation", respectively, to be contained in the Proxy Statement.

 Item
12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 The
following table sets forth the indicated information as of September 30, 2023 with respect to our equity compensation plans:

 Plan Category

 of
 securities
 to be issued upon
 exercise of
 outstanding
 options,
 warrants
 and rights

 Weighted-

 average
 exercise
 price of
 outstanding
 options, warrants
 and rights

 of
 securities
 remaining
 available for
 future
 issuance under equity
 compensation
 plans

 Equity compensation plans approved by security
 holders

 2014 Stock Incentive Plan

 795,171

 $
 6.38

 —

 2018 Omnibus Stock Incentive Plan

 1,760,000

 1.09

 —

 2020 Omnibus Stock Incentive Plan

 1,820,000

 1.13

 —

 2021 Omnibus Stock Incentive Plan

 8,630,000

 1.67

 —

 2023 Omnibus Stock Incentive
 Plan

 300,000

 1.43

 11,735,000

 Total

 13,305,171

 $
 1.79

 11,735,000

 Our
equity compensation plans consist of the Citius Pharmaceuticals, Inc. 2023 Omnibus Stock Incentive Plan, 2021 Omnibus Stock Incentive
Plan, 2020 Omnibus Stock Incentive Plan, 2018 Omnibus Stock Incentive Plan and 2014 Stock Incentive Plan, which were all approved by
our stockholders. We do not have any equity compensation plans or arrangements that have not been approved by our stockholders.

 We
no longer may grant awards under the 2014 Stock Incentive Plan, the 2018 Omnibus Stock Incentive Plan, the 2020 Omnibus Stock Incentive
Plan or the 2021 Omnibus Stock Incentive Plan.

 The
other information required by this Item is incorporated by reference to the information under the section captioned "Security Ownership
of Certain Beneficial Owners and Management" to be contained in the Proxy Statement.

 Item
13. Certain Relationships and Related Transactions, and Director Independence

 The
information required by this Item is incorporated by reference to the information under the section captioned "Certain Relationships
and Related Transactions" and "Proposal No. 1—Election of Directors" to be contained in the Proxy Statement.

 Item
14. Principal Accountant Fees and Services

 The
information required by this Item is incorporated by reference to the information under the section captioned "Auditor and Audit
Committee Matters" to be contained in the Proxy Statement.

 PART
IV

 Item
15. Exhibits and Financial Statement Schedules

 of Document

 Registrant's

 Form

 Dated

 Filed

 Herewith

 2.1+

 Agreement
 and Plan of Merger, dated as of October 23, 2023, by and among Citius Pharmaceuticals, Inc., Citius Oncology, Inc., TenX Keane Acquisition,
 and TenX Merger Sub Inc.

 10/24/2023

 2.1

 3.1

 and Restated Articles of Incorporation of Citius Pharmaceuticals, Inc.

 9/18/2014

 3.1

 3.2

 Certificate
 of Amendment to the Amended and Restated Articles of Incorporation of Citius Pharmaceuticals, Inc., effective September 16, 2016.

 9/21/2016

 3.1

 3.3

 Certificate
 of Amendment to the Amended and Restated Articles of Incorporation of Citius Pharmaceuticals, Inc., effective June 9, 2017.

 6/8/2017

 3.1

 3.4

 Certificate
 of Amendment to the Articles of Incorporation of Citius Pharmaceuticals Inc., dated June 21, 2021.

 8-K/A

 6/22/2021

 3.1

 3.5

 and Restated Bylaws of Citius Pharmaceuticals, Inc.

 2/9/2018

 3.1

 4.1

 Form of Common Stock Purchase Warrant, dated August 13, 2018, as amended August 8, 2023.

 X

 4.2

 Form
 of Pre-Funded Common Stock Purchase Warrant, dated August 13, 2018.

 8/13/2018

 4.2

 4.3

 Form of Underwriter's Common Stock Purchase Warrant, dated August 13, 2018, as amended August 8, 2023.

 X

 4.4

 Form
 of Investor Warrant issued April 3, 2019.

 4/03/2019

 4.1

 4.5

 Form
 of Placement Agent Warrant issued April 3, 2019.

 4/03/2019

 4.2

 4.6

 Form
 of Common Stock Purchase Warrant issued September 27, 2019.

 9/27/2019

 4.1

 4.7

 Form
 of Underwriters Common Stock Purchase Warrant issued September 27, 2019.

 9/27/2019

 4.3

 4.8

 Form
 of Investor Warrant issued on February 19, 2020.

 2/19/2020

 4.1

 4.9

 Form
 of Placement Agent Warrant issued on February 19, 2020.

 2/19/2020

 4.2

 4.10

 Form
 of Investor Warrant issued May 18, 2020.

 5/18/2020

 4.1

 4.11

 Form
 of Placement Agent Warrant issued May 18, 2020.

 5/18/2020

 4.2

 4.12

 Form
 of Underwriter Warrant issued August 10, 2020.

 8/10/2020

 4.1

 4.13

 Form
 of Investor Warrant issued January 27, 2021.

 1/27/2021

 4.1

 4.14

 Form
 of Placement Agent Warrant issued January 27, 2021.

 1/27/2021

 4.2

 of Document

 Registrant's

 Form

 Dated

 Filed

 Herewith

 4.15

 Form
 of Registration Rights Agreement, dated January 24, 2021, by and between Citius Pharmaceuticals, Inc. and the purchasers signatory
 thereto.

 1/27/2021

 4.3

 4.16

 Form
 of Investor Warrant issued February 19, 2021.

 2/19/2021

 4.1

 4.17

 Form
 of Placement Agent Warrant issued February 19, 2021

 2/19/2021

 4.2

 4.18

 Form
 of Warrant issued May 8, 2023.

 5/8/2023

 4.1

 4.19

 Form
 of Placement Agent Warrant issued May 8, 2023.

 5/8/2023

 4.2

 4.20

 of Common Stock

 12/22/2022

 4.25

 10.1*

 Pharmaceuticals, Inc. 2014 Stock Incentive Plan.

 8/15/2016

 10.1

 10.2*

 Form
 of Citius Pharmaceuticals, Inc. 2014 Stock Incentive Plan Nonqualified Stock Option.

 8/15/2016

 10.2

 10.3*

 and Restated Employment Agreement between Myron Holubiak and Citius Pharmaceuticals, Inc., executed April 12, 2022, effective May
 1, 2022.

 5/12/2022

 10.1

 10.4

 Second
 Amendment to the Patent and Technology License Agreement between Novel Anti-Infective Technologies, LLC and Leonard-Meron Biosciences,
 Inc., dated March 20, 2017.

 5/15/2017

 10.8

 10.5*

 and Restated Employment Agreement between Leonard Mazur and Citius Pharmaceuticals, Inc., dated October 19, 2017.

 12/11/2018

 10.23

 10.6*

 Employment
 Agreement between Jaime Bartushak and Citius Pharmaceuticals, Inc., dated November 27, 2017.

 12/1/2017

 10.1

 10.7*

 Pharmaceuticals, Inc. 2018 Omnibus Stock Incentive Plan

 2/14/2018

 10.2

 10.8

 Form
 of Securities Purchase Agreement between Citius Pharmaceuticals, Inc. and the purchasers named therein, dated March 28, 2018.

 3/29/2018

 10.1

 10.9+

 and Technology License Agreement, dated January 2, 2019, between the Board of Regents of the University of Texas System on behalf
 of the University of Texas M. D. Anderson Cancer Center and Citius Pharmaceuticals, Inc.

 2/14/2019

 10.1

 10.10

 First
 Amendment, dated October 15, 2015, to Patent and Technology License Agreement, dated May 14, 2014, between Novel Anti-Infective Technologies,
 LLC and Leonard-Meron Biosciences, Inc.

 2/14/2019

 10.2

 10.11+

 Patent and Technology License Agreement, dated May 14, 2014, between Novel Anti-Infective Technologies, LLC and Leonard-Meron Biosciences, Inc.

 5/12/2023

 10.1

 of Document

 Registrant's

 Form

 Dated

 Filed

 Herewith

 10.12

 Form
 of Securities Purchase Agreement, dated April 1, 2019, by and between Citius Pharmaceuticals, Inc. and the purchasers named therein.

 4/03/2019

 10.1

 10.13*

 Pharmaceuticals, Inc. 2020 Omnibus Stock Incentive Plan.

 Schedule
 14A

 12/20/2019

 Appendix
 A

 10.14*

 Form
 of Notice of Stock Option Grant and Stock Option Award Agreement.

 2/13/2020

 10.2

 10.15

 Form
 of Warrant Exercise Agreement, dated February 14, 2020, by and between Citius Pharmaceuticals, Inc. and the investor signatory thereto.

 2/19/2020

 10.1

 10.16

 Form
 of Warrant Exercise Agreement, dated February 14, 2020, by and between Citius Pharmaceuticals, Inc. and the investor signatory thereto.

 2/19/2020

 10.2

 10.17

 Form
 of Securities Purchase Agreement, dated May 14, 2020, by and between Citius Pharmaceuticals, Inc. and the purchasers signatory thereto.

 5/18/2020

 10.1

 10.18*

 Employment
 Agreement, effective as of July 14, 2020, between Citius Pharmaceuticals, Inc. and Myron Czuczman.

 8/14/2020

 10.3

 10.19+

 License
 Agreement, dated October 6, 2020, between NoveCite, Inc. and Novellus Therapeutics, Limited.

 12/16/2020

 10.24

 10.20

 Form
 of Securities Purchase Agreement, dated January 24, 2021, by and between Citius Pharmaceuticals, Inc. and the purchasers signatory
 thereto.

 1/27/2021

 10.1

 10.21

 Form
 of Securities Purchase Agreement, dated February 16, 2021, by and between Citius Pharmaceuticals, Inc. and the purchasers signatory
 thereto.

 2/19/2021

 10.1

 10.22*

 Pharmaceuticals, Inc. 2021 Omnibus Incentive Stock Plan.

 Schedule
 14A

 4/12/2021

 Appendix
 B

 10.23*

 Form
 of Notice of Stock Option Grant and Stock Option Award Agreement.

 10.29

 10.24+

 Asset
 Purchase Agreement, dated as of September 1, 2021, between Dr. Reddy's Laboratories S.A. and Citius Pharmaceuticals, Inc.

 10.30

 10.25+

 and Restated License, Development and Commercialization Agreement, dated as of February 26, 2018, between Eisai, Ltd. and Dr. Reddy's
 Laboratories S.A.

 10.31

 10.26+

 Amendment
 to Amended and Restated License, Development and Commercialization Agreement, dated as of August 9, 2018, between Eisai, Ltd. and
 Dr. Reddy's Laboratories S.A.

 10.32

 10.27+

 Amendment
 No. 2 to Amended and Restated License, Development and Commercialization Agreement, dated as of August 31, 2021, between Eisai, Ltd.
 and Dr. Reddy's Laboratories S.A.

 10.33

 10.28

 Pharmaceuticals, Inc. 2023 Omnibus Stock Incentive Plan.

 Schedule
 14A

 12/22/2022

 Annex
 A

 10.29

 Form
 of Securities Purchase Agreement, dated May 3, 2023, by and between Citius Pharmaceuticals, Inc. and the purchasers signatory thereto.

 5/8/2023

 10.1

 10.30+

 Sponsor
 Support Agreement, dated as of October 23, 2023, by and among 10XYZ Holdings LP, TenX Keane Acquisition, Citius Pharmaceuticals,
 Inc. and Citius Oncology, Inc.

 10/24/2023

 10.1

 10.31+

 Form
 of Amended and Restated Registration Rights Agreement.

 10/24/2023

 10.2

 10.32+

 Form
 of Amended and Restated Shared Services Agreement.

 10/24/2023

 10.3

 Subsidiaries.

 --

 --

 --

 X

 of Document

 Registrant's

 Form

 Dated

 Filed

 Herewith

 23.1

 Consent of Independent Registered Public Accounting Firm.

 --

 --

 --

 X

 31.1

 Certification of the Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a).

 --

 --

 --

 X

 31.2

 Certification of the Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a).

 --

 --

 --

 X

 32.1

 Certifications of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002.

 --

 --

 --

 X

 EX-101.INS

 DOCUMENT

 --

 --

 --

 X

 EX-101.SCH

 EXTENSION SCHEMA DOCUMENT

 --

 --

 --

 X

 EX-101.CAL

 EXTENSION CALCULATION LINKBASE

 --

 --

 --

 X

 EX-101.DEF

 EXTENSION DEFINITION LINKBASE

 --

 --

 --

 X

 EX-101.LAB

 EXTENSION LABELS LINKBASE

 --

 --

 --

 X

 EX-101.PRE

 EXTENSION PRESENTATION LINKBASE

 --

 --

 --

 X

 Cover Page Interactive

 +
 Portions
 of this exhibit have been omitted pursuant to Item 601(b)10 of Regulation S-K or certain
 of the exhibits and schedules to this exhibit have been omitted in accordance with Regulation
 S-K Item 601(b)(2) or 601(a)(5), as applicable. Citius Pharma agrees to furnish
 supplementally an unredacted copy such exhibit, including any omitted exhibits and schedules,
 to the SEC upon its request.

 *
 Management
 contract or compensatory plan.

 Item
16. Form 10-K Summary.

 Not applicable.

 SIGNATURES

to the requirements of Section 13 or 15(d) 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.

 CITIUS PHARMACEUTICALS, INC.

 Date: December 29, 2023

 By:

 /s/
 Leonard Mazur

 Leonard Mazur

 Chief
 Executive Officer

 (Principal
 Executive Officer)

to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

 Signature

 Title

 Date

 /s/
 Leonard Mazur

 Chief Executive Officer
 and Director

 Leonard Mazur

 (Principal Executive Officer)

 /s/
 Myron Holubiak

 Executive Vice Chairman
 and Director

 Myron Holubiak

 /s/ Jaimie
 Bartushak

 Chief Financial Officer

 December 29, 2023

 Jaime Bartushak

 (Principal Financial Officer and Principal Accounting
 Officer)

 /s/
 Suren Dutia

 Director

 Suren Dutia

 /s/
 Carol Webb

 Director

 Carol Webb

 /s/
 Eugene Holuka

 Director

 Eugene Holuka

 /s/
 Dennis McGrath

 Director

 Dennis McGrath

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