UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: September 30, 2025

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

For the transition period from to

OSR HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware		001-41390		84-5052822
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification Number)

10900 NE 4th Street, Suite 2300 Bellevue, WA		98004
(Address of principal executive offices)		(Zip Code)

(425) 635-7700

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

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

Title of Each Class:	Trading Symbol:	Name of Each Exchange on Which Registered:
Common stock, par value $0.0001 per share	OSRH	The Nasdaq Stock Market LLC
Redeemable warrants, exercisable for shares of common stock at an exercise price of $11.50 per share	OSRHW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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

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

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

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

As of November 5, 2025, there were 25,672,788 shares of common stock, par value $0.0001 per share issued and outstanding.

TABLE OF CONTENTS

PART I Financial Information		1

Item 1.	Financial Statements	1
	Condensed Consolidated Balance Sheets as of September 30, 2025 (unaudited) and December 31, 2024	1
	Condensed Consolidated Statements of Operations and Comprehensive Income (unaudited) for the three months ended September 30, 2025 and 2024	2
	Condensed Consolidated Statements of Changes in Stockholders’ Equity (unaudited) for the three months ended September 30, 2025 and 2024	3
	Condensed Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, 2025 and 2024	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31
Item 4.	Controls and Procedures	31

PART II Other Information		32

Item 1.	Legal Proceedings	32
Item 1A.	Risk Factors	32
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32
Item 3.	Defaults Upon Senior Securities	34
Item 4.	Mine Safety Disclosures	34
Item 5.	Other Information	34
Item 6.	Exhibits	34
	Signatures	35

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

OSR HOLDINGS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In the United States Dollar, except share data)

	(Unaudited)			(Unaudited)
	September 30, 2025			December 31, 2024
Assets
Current assets:
Cash and cash equivalents	$	2,177,309		$	341,543
Trade and other receivables, less allowance for credit losses of $65,170.95 and $67,579.81 as of September 30, 2025 and December 31, 2024, respectively		533,929			933,824
Inventories, net		185,095			922,107
Prepaid income taxes		3			39
Other current financial assets		57,053			54,422
Other current assets		250,825			74,555
Total current assets		3,204,215			2,326,489
Equipment and vehicles, net		98,109			2,334
Operating lease right-of-use assets, net		50,371			78,484
Intangible assets, net		148,152,920			148,056,852
Goodwill		25,531,648			24,354,066
Other non-current financial assets		170,963			329,252
Deferred tax assets		81,303			92,101
Total assets	$	177,289,528		$	175,239,579
Liabilities and Stockholders’ Equity
Current liabilities:
Short-term borrowing	$	1,859,897		$	1,799,796
Short-term corporate bond		2,469,959			0
Trade and other payables		7,663,482			1,078,760
Accrued expenses		977,446			459,883
Operating lease liabilities-current		38,796			44,741
Other current liabilities		963,317			79,777
Income taxes payable		358,333			255
Derivative liabilities		700,777			0
Total current liabilities		15,032,007			3,463,212
Long-term debt		0			497,615
Operating lease liabilities- non-current		11,574			33,372
Other non-current liabilities		1,737			1,657
Deferred tax liabilities		28,086,365			28,035,508
Total liabilities		43,131,683			32,031,364

Stockholders’ equity:
Common stock, $0.0001 par value, Authorized 100,000,000 shares; 23,671,217 shares and 2,155,000 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively		2,367			216
Additional paid-in capital		109,548,746			162,606,449
Accumulated deficit		(32,327,645	)		(19,173,063	)
Accumulated other comprehensive income		4,721,717			(225,386	)
Non-controlling interests		52,212,660			0
Total stockholders’ equity		134,157,845			143,208,215
Total liabilities and stockholders’ equity	$	177,289,528		$	175,239,579

The accompanying notes are an integral part of the condensed consolidated financial statements.

OSR HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited)

(In the United States Dollar)

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2025			2024			2025			2024
Net sales	$	627,747		$	822,996		$	2,524,536		$	2,615,051
Cost of sales		366,014			643,903			2,061,335			1,963,835
Gross profit		261,734			179,093			463,201			651,215
Selling, general, and administrative expenses		4,065,199			3,745,635			12,413,670			10,730,393
Operating loss		(3,803,465	)		(3,566,542	)		(11,950,469	)		(10,079,178	)
Other income (expense):
Interest income		18,474			1,442			47,364			11,448
Interest expense		(43,866	)		(9,114	)		(97,194	)		(24,729	)
Other income		24,250			82,221			218,950			95,958
Other expenses		(685,218	)		(4,101	)		(9,326,489	)		(106,069	)
Loss before income taxes		(4,489,826	)		(3,496,094	)		(21,107,838	)		(10,102,570	)
Income tax benefit		1,294,952			139,560			1,294,952			1,113,183
Net loss	$	(3,194,874	)	$	(3,356,533	)	$	(19,812,886	)	$	(8,989,387	)
Attributable to:
OSR Holdings, Inc. and subsidiaries		(2,126,595	)		(3,356,533	)		(13,187,995	)		(8,989,387	)
Non-controlling interests		(1,068,279	)		0			(6,624,892	)		0
Other comprehensive income for the year, net of tax
Gain(loss) on foreign currency translation		(2,257,789	)		104			4,947,103			23,678
Total comprehensive loss for the year		(5,452,663	)		(3,356,430	)		(14,865,783	)		(8,965,709	)
Attributable to:
OSR Holdings, Inc. and subsidiaries		(3,629,440	)		(3,356,430	)		(9,895,069	)		(8,965,709	)
Non-controlling interests		(1,823,223	)		0			(4,970,715	)		0
Loss per share attributable to OSR Holding, Inc. and subsidiaries
Basic loss per ordinary share	$	(0.10	)	$	(1.56	)	$	(0.76	)	$	(4.17	)

The accompanying notes are an integral part of the condensed consolidated financial statements.

OSR HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)

(In the United States Dollar)

	Common stock				Additional paid-in			Retained Earnings (accumulated			Accumulated other comprehensive			Non- controlling			Total stockholders’
	Shares		Amounts		capital			deficit)			Income (loss)			interests			equity
Balance at January 1, 2024		5,622,954	$	640		106,896,221		$	(10,496,810	)	$	131,022		$	—		$	96,531,073
Net loss		—		—		—			(5,632,853	)		—			—			(5,632,853	)
Foreign currency translation adjustment		—		—		—			—			23,575			—			23,575
Balance at June 30, 2024		5,622,954	$	640		106,896,221		$	(16,129,663	)	$	154,597		$	—		$	90,921,794
Balance at July 1, 2024		5,622,954	$	640		106,896,221		$	(16,129,663	)	$	154,597		$	—		$	90,921,794
Net loss		—		—		—			(3,356,533	)		—			—			(3,356,533	)
Foreign currency translation adjustment		—		—		—			—			104			—			104
Balance at September 30, 2024		5,622,954	$	640		106,896,221		$	(19,486,197	)	$	154,701		$	—		$	87,565,364
Balance at January 1, 2025		2,155,000	$	216		162,606,449		$	(19,173,063	)	$	(225,386	)	$	—		$	143,208,215
Net loss		—		—		—			(11,061,400	)		—			(5,556,612	)		(16,618,012	)
Changes in Exercise tax		—		—		—			57,213			—			—			57,213
Foreign currency translation adjustment		—		—		—			—			7,204,892			4,484,754			11,689,646
Business Combination		17,121,978		1,712		(56,524,226	)		—			—			56,522,514			—
Issuance of share capital		529,481		53		(813,998	)		—			—			—			814,051
Balance at June 30, 2025		19,806,459	$	1,981		106,896,221		$	(30,177,250	)	$	6,979,506		$	55,450,656		$	139,151,113
Balance at July 1, 2025		19,806,459	$	1,981		106,896,221		$	(30,177,250	)	$	6,979,506		$	55,450,656		$	139,151,113
Net loss		—		—		—			(2,126,595	)		—			(1,068,279	)		(3,194,874	)
Foreign currency translation adjustment		—		—		—			(23,800	)		(2,257,789	)		(2,169,716	)		(4,451,305	)
Issuance of share capital		3,864,758		386		2,652,525			—			—			—			2,652,911
Balance at September 30, 2025		23,671,217		2,367		109,548,746			(32,327,645	)		4,721,717			52,212,660			134,157,845

The accompanying notes are an integral part of the condensed consolidated financial statements.

OSR HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)

(In the United States Dollar)

	Nine months ended September 30,
	2025			2024
Cash flows from operating activities:
Net loss	$	(19,812,886	)	$	(8,989,387	)
Adjustments to reconcile net loss to cash used in operating activities:
Income tax benefit		(1,294,952	)		(1,113,183	)
Depreciation		894			47,849
Amortization		7,010,647			8,488,493
Loss on inventory valuation		(8,891	)		1,346
Loss on disposal of tangible assets		-			3,477
Lease expense		40,346			-
Bad debts		(5,634	)		26,322
Severance pay		178,137			75,301
Commissions and professional fees		626,890			-
Loss on change in fair value of financial liabilities		518,686			-
Merger and acquisiton costs		8,703,455			-
Loss on foreign currency translation		54,934			54,323
Gain on change in fair value of financial liabilities		(24,200	)		-
Gain on foreign currency translation		(125,410	)		(54,256	)
Changes in operating assets and liabilities:
Decrease in trade and other receivables		461,201			154,158
Decrease in inventories, net		784,631			271,945
Increase in prepaid income taxes		-			(547	)
Increase in other current financial assets		(8,551	)		-
Decrease (increase) in other current assets		30,208			(10,786	)
Decrease in ROU assets		-			22,092
Decrease in trade and other payables		(584,752	)		(592,844	)
Increase in accrued expenses		286,720			23,447
Decrease in lease liabilities		(40,346	)		(59,553	)
Increase (decrease) in tax payables		26,525			(13,212	)
Decrease in other liabilities		(75,693	)		(3,429	)
Net cash used in operating activities		(3,258,041	)		(1,668,444	)
Cash flows from investing activities:
Decrease in deposits		-			8,388
Decrease in short-term loan		-			702,008
Decrease in long-term loan		246,037			-
Disposal of equipment and vehicles		1,029			6,056
Purchase of tangible assets		(96,871	)		-
Increase in deposits		(354	)		(7,392	)
Increase in long-term loan		(1,452,275	)		(17,637	)
Increase in cash and cash equivalents from business combination		1,232,969			-
Net cash provided by investing activities		(69,465	)		691,423
Cash flows from financing activities:
Proceeds from long-term debt		-			238,619
Proceeds from short-term borrowing		2,089,031			1,284,822
Repayment of long-term debt		(517,766	)		-
Repayment of short-term borrowing		(423,477	)		(660,622	)
Issuance of convertible bonds		1,087,780			-
Repayment of convertible bonds		(464,026	)		-
Proceeds from issuance of common stock		3,385,038			-
Net cash provided by financing activities		5,156,580			862,818
Net change in cash and cash equivalents		1,829,076			(114,201	)
Effects of changes in exchange rate on cash and cash equivalents		6,693			96,993
Cash and cash equivalents at beginning of year		341,543			540,207
Cash and cash equivalents at end of year	$	2,177,309		$	522,997
Supplemental disclosures of cash flow information:
Cash paid for interest	$	97,803		$	37,311
Cash paid for income taxes (net of refunds received)		(26,525	)		13,765

The accompanying notes are an integral part of the condensed consolidated financial statements.

OSR HOLDINGS, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

September 30, 2025 and 2024

(UNAUDITED)

(1)	Organization and nature of business

OSR Holdings, Inc. (the Company) and its subsidiaries (collectively the Group) are a global healthcare company dedicated to advancing healthcare outcomes and improving the quality of life for people and their families. The Group aims to build and develop a robust portfolio of innovative and potentially transformative therapies and healthcare solutions. The Group’s current operating businesses (through the four wholly owned subsidiaries) include (i) developing oral immunotherapies for the treatment of cancer, (ii) developing design-augmented biologics for age-related and other degenerative diseases and (iii) neurovascular intervention medical device and systems distribution in Korea. The Group’s vision is to acquire and operate a portfolio of innovative health-care related companies globally.

The Company (formerly known as Bellevue Life Sciences Acquisition Corp. or BLAC) was incorporated in Delaware on February 25, 2020. The Company was incorporated for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities (the “Business Combination”). The Company is an emerging growth company and, as such, the Company is subject to all of the risks associated with emerging growth companies.

On February 14, 2025 (the “Closing Date”), the Company consummated its previously announced business combination (the “Business Combination”) with OSR Holdings Co., Ltd., a corporation organized under the laws of the Republic of Korea (“OSR”), pursuant to the Amended and Restated Business Combination Agreement dated May 23, 2024, as amended on December 20, 2024 (the “Business Combination Agreement”). The Business Combination Agreement was entered into among the Company, OSR, and certain OSR stockholders that executed joinder agreements thereto. In connection with the consummation of the Business Combination, the Company changed its name from “Bellevue Life Sciences Acquisition Corp. or BLAC” to “OSR Holdings, Inc.”

The Business Combination was consummated on February 14, 2025, which, for accounting and reporting purposes under U.S. generally accepted accounting principles (US-GAAP), was treated as the equivalent of OSR Holdings Co., Ltd. exchanging its stock for the net assets of OSR Holdings, Inc, accompanied by an equity recapitalization of OSR Holdings, Inc, which was determined to fall within the scope of Accounting Standards Codification (ASC) 805 Business Combinations. OSR Holdings, Inc. was treated as the acquired company, and its net assets were stated at historical cost, with no goodwill or other intangible assets recorded. The excess of the fair value of shares exchanged to OSR Holdings, Inc. over the fair value of OSR Holdings, Inc’s identifiable net assets acquired represented compensation for the service of a stock exchange listing for its shares and was expensed as incurred.

Details of shareholders as of September 30, 2025 are as follows:

Name of Shareholder	Number of ordinary share		Percentage of ownership
Bellevue Global Life Sciences Investors LLC		1,332,500		5.63	%
BCM Europe AG		8,612,634		36.38	%
Bellevue Capital Management LLC		3,123,970		13.20	%
Duksung Co.,Ltd.		1,420,215		6.00	%
Others		9,181,898		38.79	%
Total		23,671,217		100.00	%

As of September 30, 2025, there were 23,671,217 shares of the registrant’s common stock outstanding.

Details of investments in subsidiaries as of September 30, 2025 are as follows:

Name of subsidiary	Share capital		Percentage of ownership			Principal activities
VAXIMM AG (“VAXIMM”)	$	778,208		100.00	%	Biotech (drug development)
RMC Co., Ltd. (“RMC”)		24,961		100.00	%	Medical device distribution
Darnatein Co., Ltd. (“Darnatein”)		4,611,801		100.00	%	Biotech (drug development)
OSR Holdings, Inc. ("OSRI") (*1)		2,450		N/A		SPAC

Key financial information of the subsidiaries at September 30, 2025 are as follows :

Name of subsidiary	Asset		Liability		Equity			Sales		Net Income(loss)
VAXIMM AG	$	638,405	$	275,103	$	363,302		$	74,031	$	(206,841	)
RMC Co.,Ltd		1,342,303		1,123,849		218,453			2,450,506		(490,105	)
Darnatein Co.,Ltd		170,206		907,976		(737,770	)		-		(287,890	)
OSR Holdings, Inc. (*1)		3,487,130		11,197,024		(7,709,894	)		-		(2,945,469	)

(*1)	Aforementioned above, the Company is treated as the acquired company under ASC 805 Business Combinations. As such, it is shown as subsidiary for the subsidiary investment details.

Summaries of entities, which are newly included in consolidation scope for the periods ended September 30, 2025 and 2024 are as follows:

For the nine months ended September 30, 2025
Name of subsidiary	Reason	Type of purchase consideration
OSR Holdings, Inc.	Acquisition (*2)	Equity swap with shares of the Parent and OSR Holdings, Inc.’s share

(*2)	The Parent acquired subsidiary in February 2025 and accounted for the acquisitions at March 31, 2025, which is deemed the acquisition date.

(2)	Summary of significant accounting policies

Basis of presentation

The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to US-GAAP and reflect all adjustments which are, in the opinion of management, necessary to a fair presentation of the results of the interim periods presented, under the rules and regulations of the United States Securities and Exchange Commission (the “SEC”). These condensed consolidated financial statements include all adjustments consisting of only normal recurring adjustments, necessary for a fair statement of the results of the interim periods presented. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the entire year ending December 31, 2025. Certain information and note disclosures normally included in the Company’s annual audited consolidated financial statements and accompanying notes prepared in accordance with US-GAAP have been condensed in, or omitted from, these interim financial statements. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes to the audited consolidated financial statements for the fiscal year ended December 31, 2024 included in the Company’s Annual Report on Form 10-K filed with the SEC on April 22, 2025, which is presented in Korean won.

Principle of consolidation

The condensed consolidated financial statements include the accounts of OSR Holdings, Inc. and its subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation.

The Company consolidates entities in which it has a controlling financial interest based on either the variable interest entity (VIE) or voting interest model. The Company is required to first apply the VIE model to determine whether it holds a variable interest in an entity, and if so, whether the entity is a VIE. If the Company determines it does not hold a variable interest in a VIE, it then applies the voting interest model. Under the voting interest model, the Company consolidates an entity when it holds a majority voting interest in an entity.

The Company accounts for investments in which it has significant influence but not a controlling financial interest using the equity method of accounting.

Use of estimates

The preparation of the condensed consolidated financial statements in conformity with US-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 the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include allowance for credit losses, valuation of inventories, valuation of deferred tax assets, the useful lives of equipment and vehicles, lease liabilities and right-of-use assets, and other contingencies.

Cash and cash equivalents

The Group considers all highly liquid financial instruments with original maturities of three months or less when purchased to be cash equivalents.

Allowance for credit losses

The Group records an allowance for credit losses (ACL) under Subtopic 326-20 Financial Instruments - Credit Losses – Measured at Amortized Cost for the current expected credit losses inherent in its financial assets measured at amortized cost and contract assets. The ACL is a valuation account deducted from the amortized cost basis to present the net amount expected to be collected. The estimate of expected credit losses includes expected recoveries of amounts previously written off as well as amounts expected to be written off.

Accounts receivable

The Group uses an aging schedule to estimate the ACL for trade accounts receivable. This method categorizes trade receivables into different groups based on industry and the number of days past due. Past due status is measured based on the number of days since the payment due date. The trade receivables are evaluated individually for expected credit losses if they no longer share similar risk characteristics. The Group determines that the receivables no longer share similar risk characteristic if they are past due balances over 90 days and over a specified amount. The Group evaluates the collectability of trade accounts receivables with payments that are more than 90 days past due on an individual basis to determine if any are deemed uncollectible. Trade accounts receivable balances are deemed uncollectible and written off as a deduction from the allowance after all means of collection have been exhausted.

Accounts receivable

Accounts receivables are recorded at the invoiced amount and do not bear interest. Amounts collected on trade accounts receivable are included in cash flows from operating activities in the condensed consolidated statements of cash flows.

Inventories

Inventories are stated at the lower of cost or net realizable value and cost is determined by the first-in, first-out method. Cost comprises of direct materials and delivery costs, direct labor, import duties and other taxes, an appropriate proportion of variable and fixed overhead expenditure based on normal operating capacity, and, where applicable, transfers from cash flow hedging reserves in equity. Costs of purchased inventory are determined after deducting rebates and discounts received or receivable.

Stock in transit is stated at the lower of cost and net realizable value. Cost comprises of purchase and delivery costs, net of rebates and discounts received or receivable.

Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.

Equipment and vehicles

Equipment and vehicles are stated at historical cost less accumulated depreciation and accumulated impairment losses. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Depreciation of all equipment and vehicles is calculated using the straight-line method to allocate their cost or revalued amounts, net of their residual values, over their estimated useful lives as follows:

		Estimated useful lives
Vehicle		5 years
Office equipment		5 years
Facility equipment		3 to 13 years

The assets’ depreciation method, residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Goodwill and intangible assets

Goodwill represents the excess purchase price over the estimated fair value of net assets acquired in a business combination.

The Group accounts for intangible assets in accordance with Accounting Standards Codification (ASC) Topic 350, Intangibles – Goodwill and Other (ASC 350). ASC 350 requires that intangible assets with estimable useful lives be amortized over their respective estimated useful lives and reviewed for impairment in accordance with accounting standards.

When impairment indicators are identified, the Group compares the reporting unit’s fair value to its carrying amount, including goodwill. An impairment loss is recognized as the difference, if any, between the reporting unit’s carrying amount and its fair value, to the extent the difference does not exceed the total amount of goodwill allocated to the reporting unit.

Indefinite-lived intangible assets are tested for impairment annually, and more frequently when there is a triggering event. Annually, or when there is a triggering event, the Group first performs a qualitative assessment by evaluating all relevant events and circumstances to determine if it is more likely than not that the indefinite-lived intangible assets are impaired; this includes considering any potential effect on significant inputs to determining the fair value of the indefinite-lived intangible assets. When it is more likely than not that an indefinite-lived intangible asset is impaired, then the Group calculates the fair value of the intangible asset and performs a quantitative impairment test.

Impairment of long--lived assets

Long-lived assets, such as equipment, vehicles and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Group first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment loss is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary.

Leases

The Group is a lessee in several noncancellable operating leases, primarily for plants and main offices. The Group does not have a finance lease.

The Group accounts for leases in accordance with ASC Topic 842, Leases. The Group determines if an arrangement is or contains a lease at contract inception. The Group recognizes a right-of-use (ROU) asset and a lease liability at the lease commencement date.

For operating leases, the lease liability is initially and subsequently measured at the present value of the unpaid lease payments at the lease commencement date. For finance leases, the lease liability is initially measured in the same manner and date as for operating leases and is subsequently measured at amortized cost using the effective-interest method.

Key estimates and judgments include how the Group determines (1) the discount rate it uses to discount the unpaid lease payments to present value, (2) lease term, and (3) lease payments.

●

Topic 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. Generally, the Group cannot determine the interest rate implicit in the lease because it does not have access to the lessor’s estimated residual value or the amount of the lessor’s deferred initial direct costs. Therefore, the Group generally uses its incremental borrowing rate as the discount rate for the lease. The Group’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. Because the Group does not generally borrow on a collateralized basis, it uses the interest rate it pays on its noncollateralized borrowings as an input to deriving an appropriate incremental borrowing rate, adjusted for the amount of the lease payments, the lease term, and the effect on that rate of designating specific collateral with a value equal to the unpaid lease payments for that lease.

●

The lease term for all of the Group’s leases includes the noncancellable period of the lease plus any additional periods covered by either a Group option to extend (or not to terminate) the lease that the Group is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor.

●

Lease payments included in the measurement of the lease liability comprise the following:

–

Fixed payments, including in-substance fixed payments, owed over the lease term (includes termination penalties the Group would owe if the lease term reflects the Group’s exercise of a termination option);

–

Variable lease payments that depend on an index or rate, initially measured using the index or rate at the lease commencement date;

–

Amounts expected to be payable under a Group-provided residual value guarantee; and

–

The exercise price of a Group option to purchase the underlying asset if the Group is reasonably certain to exercise the option.

The ROU asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date, plus any initial direct costs incurred less any lease incentives received.

For operating leases, the ROU asset is subsequently measured throughout the lease term at the carrying amount of the lease liability, plus initial direct costs, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

ROU assets are periodically reduced by impairment losses. The Group uses the long-lived assets impairment guidance in ASC Subtopic 360-10, Property, Plant, and Equipment – Overall, to determine whether an ROU asset is impaired, and if so, the amount of the impairment loss to recognize.

The Group monitors for events or changes in circumstances that require a reassessment of one of its leases. When a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in profit or loss.

Operating lease ROU assets are presented as operating lease right of use assets on the condensed consolidated balance sheets. The current portion of operating lease liabilities are presented separately on the condensed consolidated balance sheets.

The Group has elected not to recognize ROU assets and lease liabilities for short-term leases that have a lease term of 12 months or less. The Group recognizes the lease payments associated with its short-term leases as an expense on a straight-line basis over the lease term.

Foreign currency translation

The Group has operations in South Korea, Switzerland, and Germany. Accounting records in foreign operations are maintained in local currencies and remeasured to the US dollars during the consolidation. Nonmonetary assets and liabilities are translated at historical rates, and monetary assets and liabilities are translated at exchange rates in effect at the end of the year. Income statement accounts are translated at average rates for the year. Gains or losses from remeasurement of foreign currency financial statements into the US dollars are included in current results of comprehensive income.

Revenue recognition

The Group only has revenue from customers. The Group recognizes revenue when it satisfies performance obligations under the terms of its contracts, and control of its products is transferred to its customers in an amount that reflects the consideration the Group expects to receive from its customers in exchange for those products. This process involves identifying the customer contract, determining the performance obligations in the contract, determining the transaction price, allocating the transaction price to the distinct performance obligations in the contract, and recognizing revenue when the performance obligations have been satisfied. A performance obligation is considered distinct from other obligations in a contract when it (a) provides a benefit to the customer either on its own or together with other resources that are readily available to the customer and (b) is separately identified in the contract. The Group considers a performance obligation satisfied once it has transferred control of a good or product to a customer, meaning the customer has the ability to direct the use and obtain the benefit of the good or product.

Income taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Group recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Valuation allowances are established when management determines it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Group reports income tax-related interest and penalties relating to uncertain tax positions, if applicable, as a component of income tax expense.

Fair value measurements

The Group utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Group determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels:

–

Level 1 inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date.

–

Level 2 inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability.

–

Level 3 inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date.

The carrying value of cash and cash equivalents, trade and other receivables, inventories, prepaid expenses and other current and financial assets, trade and other payable, short-term borrowing, current operating lease liabilities, and accrued expenses and other current liabilities approximates their fair value due to the short-term nature of these instruments. The carrying amount reported in the condensed consolidated balance sheets for notes payable to related party may differ from fair value since the interest rate is fixed.

Compound Financial Instruments

Compound financial instruments are convertible bonds that can be converted into equity instruments at the option of the holder. The liability component of a compound financial instrument is recognized initially at the fair value of a similar liability that does not have an equity conversion right and subsequently measured at amortized cost until extinguished on conversion or maturity of the bonds. The equity component is recognized initially on the difference between the fair value of the compound financial instrument as a whole and the fair value of the liability component. Any directly attributable transaction costs are allocated to the liability and equity components in proportion to their initial carrying amounts.

Accounting pronouncements adopted as of September 30, 2025

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which provides an exception to fair value measurement for contract assets and contract liabilities related to revenue contracts acquired in a business combination. The ASU requires an entity (acquirer) to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. The ASU is effective for the Company for annual and interim periods in fiscal years beginning after December 15, 2023. The ASU is applied to business combinations occurring on or after the effective date. The Group adopted this ASU as of January 1, 2024 and there is no impact on the Group’s condensed consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires enhanced disclosure of significant segment expenses on an annual and interim basis. This ASU will be effective for the annual periods beginning the year ended December 31, 2024, and for interim periods beginning January 1, 2025. Early adoption is permitted. Upon adoption, this ASU should be applied retrospectively to all prior periods presented in the financial statements. The Group adopted this ASU as of January 1, 2025 and there is not impact on the Group’s condensed consolidated financial statements.

Accounting pronouncements issued, but not adopted as of September 30, 2025

In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements – Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative. The ASU modifies the disclosure or presentation requirements of a variety of Topics in the Codification to align with the SEC’s regulations. The ASU also makes those requirements applicable to entities that were not previously subject to the SEC’s requirements. The ASU is effective for the Company two years after the effective date to remove the related disclosure from Regulation S-X or S-K. As of the date these financial statements have been made available for issuance, the SEC has not yet removed any related disclosure. The Group does not expect the adoption of ASU 2023-06 to have a material effect on its condensed consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. This ASU will be effective for the annual periods beginning the year ended December 31, 2026. Early adoption is permitted. Upon adoption, this ASU can be applied prospectively or retrospectively. The Group is currently evaluating the impact this ASU will have on the Group's consolidated financial statements.

(3)

Critical accounting estimates and assumptions

The preparation of condensed consolidated financial statements requires the Group to make estimates and assumptions concerning the future. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

Income taxes

The Group’s taxable income generated from these operations are subject to income taxes based on tax laws and interpretations of tax authorities in numerous jurisdictions. There are many transactions and calculations during the ordinary course of business for which the ultimate tax determination is uncertain.

Deferred tax assets are recognized for deductible temporary differences and unused tax losses to the extent that it is probable that taxable profit will be available against which the temporary differences and the losses can be utilized. Significant management judgement is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing and the level of future taxable profits, together with future tax planning strategies

Business combinations

Business combinations are initially accounted for on a provisional basis. The fair value of assets acquired, liabilities and contingent liabilities assumed are initially estimated by the Parent taking into consideration all available information at the reporting date. Fair value adjustments on the finalization of the business combination accounting is retrospective, where applicable, to the period the combination occurred and may have an impact on the assets and liabilities, depreciation and amortization reported.

Patent technology

Patent technology is recognized in Intangible assets on the condensed consolidated balance sheets. The Group considers both qualitative and quantitative factors when determining whether the patent technology may be impaired. For the purposes of assessing impairment, the Group follows its accounting policy disclosed in Note 2. In assessing whether there is any indication that the patent technology may be impaired, the Group considers, at minimum, the following indications:

External sources of information

●

there are observable indications that the patent technology’s value has declined during the period significantly more than would be expected as a result of the passage of time or normal use.

●

significant changes with an adverse effect on the Group have taken place during the period, or will take place in the near future, in the technological, market, economic or legal environment in which the entity operates or in the market to which an asset is dedicated.

●

market interest rates or other market rates of return on investments have increased during the period, and those increases are likely to affect the discount rate used in calculating an asset’s value in use and decrease the asset’s recoverable amount materially.

●

the carrying amount of the net assets of the entity is more than its market capitalization.

Internal sources of information

●

evidence is available of obsolescence or physical damage of the patent technology.

●

significant changes with an adverse effect on the entity have taken place during the period, or are expected to take place in the near future, in the extent to which, or manner in which, the patent technology is used or is expected to be used. These changes include the patent technology becoming idle, plans to discontinue or restructure the operation to which the patent technology belongs, and plans to dispose of the patent technology before the previously expected date.

●

evidence is available from internal reporting that indicates that the economic performance of the patent technology is, or will be, worse than expected.

(4)

Financial risk management

The Group is exposed to various financial risks such as market risk (exchange risk, interest rate risk), credit risk and liquidity risk due to various activities. The Group's overall risk management policy focuses on volatility in the financial markets and focuses on minimizing any negative impact on financial performance. Risk management is conducted under the supervision of the finance department according to the policy approved by the Board of Directors. The finance department identifies, evaluates and manages financial risks in close cooperation with the sales departments. The Board of Directors provides written policies on overall risk management principles and specific areas such as foreign exchange risk, interest rate risk, credit risk, use of derivative and non-derivative financial instruments, and investments in excess of liquidity.

Market risk management

Market risk is the risk of possible losses which arise from the changes of market factors, such as interest rate, stock price, foreign exchange rate, commodity value and other market factors related to the fair value or future cash flows of the financial instruments, such as securities, derivatives and others.

Currency risk

The functional currency of the foreign subsidiary’s operations is the local currency. Therefore, for purposes of the condensed consolidated financial statements, the results of foreign operations are translated from the local currency into U.S. dollars. Local currency assets and liabilities are translated at the rates of exchange on the balance sheet date, and local currency revenues and expenses are translated at average rates of exchange during the period. Resulting translation gains or losses are included in the accompanying condensed consolidated financial statements as a component of accumulated other comprehensive loss.

Interest rate risk

Interest rate risk refers to the risk that interest income and interest expenses arising from deposits or borrowings will fluctuate due to changes in market interest rates in the future, which mainly arises from deposits and borrowings with floating interest rates. The goal of interest rate risk management is to maximize corporate value by minimizing uncertainty caused by interest rate fluctuations.

As of the end of the reporting period, there are no financial instruments subject to a variable interest rate.

Price risk

Price risk is the risk that the fair value of a financial instrument or future cash flows will change due to changes in market prices other than interest rate or foreign exchange rate. As of the end of the reporting period, the Group is not exposed to commodity price risk. Investments in financial instruments are made on a non-recurring basis according to management's judgment.

Credit risk management

Credit risk is the risk of possible losses in an asset portfolio in the events of counterparty’s default, breach of contract and deterioration in the credit quality of the counterparty. For the risk management reporting purposes, the Group manages the credit risk systematically and pursues value maximization and continuous growth of the Group by efficient resource allocation and monitoring non-performing loans. In order to reduce the risks that may occur in transactions with financial institutions, such as cash and cash equivalents and various deposits, the Group conducts transactions only with financial institutions with high creditworthiness. As of September 30, 2025, the Group believes that there are low signs of material default, and the maximum exposure to credit risk as of September 30, 2025 is equal to the book value of financial instruments (excluding cash).

Liquidity risk management

The Group constantly monitors its liquidity positions to ensure that no borrowing limits or commitments are breached to meet operating capital needs. In estimating liquidity, we also take into account external laws or legal requirements, such as the group's financing plan, compliance with agreements, internal target financial ratios and currency restrictions.

The Group's liquidity risk analysis details as of September 30, 2025 and December 31, 2024 are as follows:

	September 30, 2025
					Remaining maturity
	Book Value		Cashflow by contract		Within a year		1 year to 3 years		More than 3 years
Financial liabilities	$	5,030,633	$	5,075,737	$	5,075,737	$	-	$	-
Other Payables		8,640,928		9,269,662		8,973,623		296,038		-
Lease liabilities		50,371		68,464		48,139		20,325		-
Total	$	13,721,931	$	14,413,863	$	14,097,499	$	316,363	$	-

	December 31, 2024
					Remaining maturity
	Book Value		Cashflow by contract		Within a year		1 year to 3 years		More than 3 years
Borrowings	$	2,297,411	$	2,423,008	$	1,840,406	$	35,048	$	547,555
Other Payables		1,538,643		1,538,643		1,538,643		-		-
Lease liabilities		80,848		93,537		48,980		44,558		-
Total	$	3,916,903	$	4,055,188	$	3,428,028	$	79,605	$	547,555

Capital risk management

Capital includes issued capital, share premium and all other equity reserves attributable to the equity holders of the Group. The primary objective of the Group’s capital management is to maximize the shareholder value.

The Group manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Group uses the debt ratio as a capital management indicator. This ratio is calculated by dividing total liabilities by total equity, and total liabilities and total equity are calculated based on the amounts in the Group’s consolidated financial statements.

The group's debt ratio as of September 30, 2025 and December 31, 2024 are as follows:

	September 30, 2025			December 31, 2024
Net borrowings (A)
Borrowings	$	5,030,633		$	2,297,411
Lease liabilities		50,371			78,113
Less: cash and cash equivalents		(2,177,309	)		(341,543	)
		2,903,694			2,033,981
Total equity (B)		134,157,845			143,208,215
Debt ratio (A / B)		2.2	%		1.4	%

(5)

Fair value measurements

Book value and fair value of financial instruments

The difference between the carrying amount and fair value of the Group's financial assets and liabilities as of September 30, 2025 and December 31, 2024 are insignificant.

Fair value hierarchy

All financial assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

●

Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities

●

Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

●

Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

Fair values of the Group’s financial assets and liabilities as of September 30, 2025 and December 31, 2024, which are accounted as amortized cost, are categorized as Level 3.

Recurring transfer between levels of the fair value hierarchy

Fair value hierarchy classifications of the financial instruments that are measured at fair value level 3 as at September 30, 2025 is as follows(Null for December 31, 2024):

	September 30, 2025
	Level 1		Level 2		Level 3		Total
Recurring fair value measurements Financial liabilities at fair value through profit or loss	$	-	$	-	$	700,777	$	700,777

Valuation Techniques and the Inputs

Valuation techniques and inputs used in the recurring and non-recurring fair value measurements categorized within Level 3 of the fair value hierarchy as at September 30, 2025 is as follows:(Null for December 31, 2024):

The Group did not change any valuation techniques in determining the fair value, which is categorized within Level 3 of the fair value hierarchy.

September 30, 2025

Fair Value

Level

Valuation
Techniques

Inputs

Financial liabilities at fair value

Tsiveriotis-

through profit or loss

630,603

Fernandes model

Stock Volatility, Risk-free rate

(6)

Financial instruments by category

The carrying value of financial instruments category as of September 30, 2025 and December 31, 2024 are as follows:

	September 30, 2025
Financial assets:	Financial assets at amortized cost		Financial liabilities at fair value		Financial liabilities at amortized cost		Total
Cash and cash equivalents	$	2,177,309	$	-	$	-	$	2,177,309
Trade and other receivables		533,929		-		-		533,929
Other current financial assets		57,053		-		-		57,053
Other non-current financial assets		170,963		-		-		170,963
Fianancial liabilities:
Trade and other payables		-		-		7,663,482		7,663,482
Accrued expenses		-		-		977,446		977,446
Current financial liabilities		-		-		4,329,856		4,329,856
Derivative liabilities		-		700,777		-		700,777

	December 31, 2024
Financial assets:	Financial assets at amortized cost		Financial liabilities at fair value		Financial liabilities at amortized cost		Total
Cash and cash equivalents	$	341,543	$	-	$	-	$	341,543
Trade and other receivables		933,824		-		-		933,824
Other current financial assets		54,422		-		-		54,422
Other non-current financial assets		329,252		-		-		329,252
Fianancial liabilities:
Trade and other payables		-		-		1,078,760		1,078,760
Accrued expenses		-		-		459,883		459,883
Borrowings		-		-		2,297,411		2,297,411

Net gains or losses by financial instrument category for the nine months ended September 30, 2025 and 2024 are as follows:

	For the nine months ended September 30, 2025			For the nine months ended September 30, 2024
Amortized cost:
Interest income	$	47,364		$	11,448
Foreign exchange gains		25,941			32,948
Gains on foreign currency translation		125,410			54,256
Interest expense		(97,194	)		(24,729	)
Losses on foreign currency transaction		(47,356	)		(42,442	)
Losses on foreign currency translation		(56,949	)		(54,323	)

Financial assets measured at fair value through profit and loss:
Gains on change in fair value of financial liabilities		24,200			-
Losses on change in fair value of financial liabilities		(518,686	)		-

(7)

Cash and cash equivalents

The Group considers all money market funds and highly liquid financial instruments with original maturities of three months or less to be cash equivalents.

		September 30, 2025				December 31, 2024
Cash and cash equivalents		$	2,177,309			$	341,543

(8)

Trade and other receivables, net

All trade receivables are recorded at the invoiced amount and do not bear interest. Amounts collected on trade receivables are included in net cash provided by operating activities in the statements of cash flows. The Group does not have any off-balance sheet credit exposure related to its customers.

	September 30, 2025			December 31, 2024
Trade receivables	$	554,352		$	972,036
Less: Allowance for credit losses		(65,171	)		(67,580	)
Net trade receivables		489,181			904,456
Other receivables		44,748			29,368
Total	$	533,929		$	933,824

(9)

Inventories, net

Inventories consisted of the following as of September 30, 2025 and December 31, 2024:

	September 30, 2025			December 31, 2024
Merchandised goods	$	205,089		$	949,724
Less inventory reserves		(19,994	)		(27,617	)
	$	185,095		$	922,107

(10)	Other financial assets

Details of other financial assets as of September 30, 2025 and December 31, 2024 are as follows:

	September 30, 2025				December 31, 2024
	Current		Non-current		Current		Non-current
Leasehold guarantee deposits	$	57,053	$	23,485	$	54,422	$	21,669
Other deposits		-		1,498		-		1,088
Loan		-		145,980		-		306,494
Total	$	57,053	$	170,963	$	54,422	$	329,252

(11)

Other assets

Details of other assets as of September 30, 2025 and December 31, 2024 are as follows:

	September 30, 2025				December 31, 2024
	Current		Non-current		Current		Non-current
Prepayments	$	94,269	$	-	$	53,908	$	-
Prepaid expenses		156,557		-		20,646		-
Total	$	250,825	$	-	$	74,555	$	-

(12)

Equity method investment

Details of investment under the equity method are as follows:

			September 30, 2025					December 31, 2024
	Location	Main business	Ownership			Book value		Ownership			Book value
Taction Co., LTD	Korea	Software development		33.3	%	$	-		33.3	%	$	-

The summarized financial information of investment under the equity method as of the closing date and for the current period is as follows:

	As of and for the year ended December 31,2024
										Comprehensive
	Assets		Liabilities		Revenue		Net loss			loss
Taction Co., LTD	$	97,936	$	32,785	$	-	$	(74,740	)	$	(74,740	)

There is no equity method valuation applied on investments in associate for the nine months ended September 30, 2025 or 2024.

Taction Co., Ltd. was incorporated to engage in software development and IT consulting. As no practical plan to generate revenue and maintain going-concern basis in the foreseeable future was provided, the Parent recognized impairment loss amounting to acquisition cost.

(13)

Equipment and vehicles, net

Equipment and vehicles consist as of September 30, 2025 and December 31, 2024:

	September 30, 2025			December 31, 2024
Office equipment	$	35,957		$	26,912
Tools and instruments		23,784			22,687
Machinery and equipment		23,327			22,251
Facilities		206,906			210,613
Vehicles		9,828			9,375
Construction in progress		89,859			-
		389,661			291,838
Less accumulated depreciation		(291,552	)		(289,504	)
Equipment and vehicles, net	$	98,109		$	2,334

(14)

Goodwill

Changes of goodwill for the nine months ended September 30, 2025 and 2024 are as follows:

	For the nine months ended September 30, 2025
	Beginning		Business combination		Impairment loss		Effects of changes in exchange rate		Ending
Goodwill	$	24,354,066	$	-	$	-	$	1,177,582	$	25,531,648

	For the nine months ended September 30, 2024
	Beginning		Business combination		Impairment loss		Effects of changes in exchange rate			Ending
Goodwill	$	27,765,222	$	-	$	-	$	(1,183,341	)	$	26,581,881

(15)

Intangible assets, net

The acquired intangible assets, all of which are being amortized, have an average useful life of approximately 20 years. Intangible assets consist of the following as of September 30, 2025 and December 31, 2024.

	As of September 30, 2025
	Average useful life	Gross carrying amount		Accumulated amortization		Net carrying amount
Technology license	20 years	$	102,558	$	82,878	$	19,680
Customer relationship	20 years		607,108		333,910		273,199
Patent technology	20 years		172,783,518		24,923,477		147,860,041
		$	173,493,185	$	25,340,265	$	148,152,920

	As of December 31, 2024
	Average useful life	Gross carrying amount		Accumulated amortization		Net carrying amount
Technology license	20 years	$	97,828	$	78,439	$	19,389
Customer relationship	20 years		579,107		231,643		347,464
Patent technology	20 years		164,814,319		17,124,320		147,690,000
		$	165,491,254	$	17,434,402	$	148,056,852

Accumulated amortization expense for intangible assets is $7,010,647 and $8,488,493 for the nine months ended September 30, 2025 and 2024, respectively.

(16)

Short-term borrowings

The Group has a loan agreement with BCM Europe AG and as of September 30, 2025, the outstanding balance was $860,000 (3.00% interest rate at September 30, 2025), which matures in 2025.

The Group has multiple loan agreements with individuals and as of September 30, 2025, the outstanding balance was $999,897 (0% interest rate at September 30, 2025), which mature various dates in 2025.

The Group has a loan agreement with Duksung Co.,Ltd and as of September 30, 2025, the outstanding balance was $800,000 (5.00% interest rate at September 30, 2025), which matures in October 2025. Refer to Note 25 Subsequent events for more details.

The Group has a loan agreement with BGLSI and as of September 30, 2025, the outstanding balance was $1,278,000 (0% interest rate at September 30, 2025), which matures in 2025.

The Group has multiple loan agreements with an individual and as of September 30, 2025, the outstanding balance was $135,000 (0% interest rate at September 30, 2025), which mature various dates in 2025.

The Group has a convertible note agreement with White Lion Capital and as of September 30, 2025, the outstanding balance was $256,959 (5.00% interest rate at September 30, 2025), which mature various dates in 2026.

The Group has a loan agreement with BCM Europe AG and as of December 31, 2024, the outstanding balance was $600,000 (3.00% interest rate at December 31, 2024).

The Group has a loan agreement with BCM Europe AG and as of December 31, 2024, the outstanding balance was $260,000 (3.00% interest rate at December 31, 2024).

The Group has a loan agreement with OSR Holdings, Inc. (f/k/a Bellevue Life Sciences Acquisition Corp.) and as of December 31, 2024, the outstanding balance was $300,000 (3.96% interest rate at December 31, 2024), which matures in October 2025.

The Group has a loan agreement with an individual and as of December 31, 2024, the outstanding balance was $50,000 (7.00% interest rate at December 31, 2024), which matures in December 2025.

The Group has multiple loan agreements with an individual and as of December 31, 2024, the outstanding balance was $408,163 (0% interest rate at December 31, 2024), which mature various dates in 2025.

Details of convertible bonds issued on May 6, 2025 and outstanding as of September 30, 2025 are as follows:

Classification		Details
Par value		USD 1,110,000
Stated interest rate		5%
Guaranteed yield upon conversion		-
Exercise price adjustments		Issuance of new shares for consideration (paid-in capital increase), stock dividends and capitalization of reserves, mergers, capital reduction, stock split and consolidation, reduction of capital and stock consolidation, etc.
Conversion condition		Variable Conversion Price. At any time, and from time to time, the Holder may utilize the Variable Conversion Price for conversions of this Note into Common Stock. The Variable Conversion Price shall be a rate per share equal to 95% multiplied by the Market Price (as defined herein) (representing a discount rate of 5%) (the “Variable Conversion Price”). “Market Price” means the lowest daily VWAP of the Common Stock during the fifteen (15) Trading Day period ending on the latest complete Trading Day prior to the Conversion Date. “Trading Price” means the lowest volume-weighted average daily price as reported on the principal securities exchange or trading market where such security is quoted, listed or traded or, if no trading price of such security is available in any of the foregoing manners, the average of the trading prices of any market makers for such security that are listed in the “pink sheets” by the National Quotation Bureau, Inc. “Trading Day” shall mean any day on which the Common Stock is tradable for any period on the NASDAQ stock market or on the principal securities exchange or other securities market on which the Common Stock is then being quoted or traded.

The conversion right on the above convertible bonds is classified as other financial liabilities.

(17)

Long-term debt

The Group has long-term debt agreements with individuals and as of December 31, 2024, the total outstanding balance was $497,615 (4.6% interest rate at December 31, 2024), which matures in 2030.

(18)

Post-employment benefits

The Group maintains a defined contribution retirement benefit plan for its employees. The Group is obligated to pay fixed contributions to an independent fund, and the amount of future retirement benefits to be paid to employees is determined by the contributions made to the fund, etc., and the investment income generated from those contributions. Plan assets are managed independently from the Group's assets in a fund managed by a trustee.

Danatein’s pension plan has converted from the DB type to the DC type at the end of March 31, 2017, and is obligated to pay severance payment as DB type which incurred before the March 31, 2017.

Meanwhile, expenses recognized by the Group in relation to the defined contribution retirement benefit plan for the nine months ended September 30, 2025 and 2024 are $401,449 and $93,458, respectively.

(19)

Related party transactions

As of September 30, 2025, the Group's related parties are as follows:

Type		Related parties
Ultimate parent entity		Bellevue Capital Management LLC
Major shareholder of the Parent		BCM Europe AG
Subsidiaries		RMC, VAXIMM, Darnatein, OSR Holdings Co., Ltd.
Associates		Taction Co., Ltd.
Other related parties		Bellevue Global Life Sciences Investors LLC
		Bellevue Global Life Sciences Acquisition Corp

There are no sales and procurement transactions and treasury transactions with related parties for the nine months ended September 30, 2025 and 2024.

Details of receivables and payables from related party transactions as at September 30, 2025 and December 31, 2024 are as follows:

	September 30, 2025
	Related parties		Short-term borrowings
BCM Europe AG	Major shareholder of the Parent	$	860,000
Bellevue Global Life Sciences Acquisition Corp	Other related parties		1,278,000

	December 31, 2024
	Related parties		Short-term borrowings
Key management	Individuals	$	340,136

Compensations paid or accrued to key management of the Parent for the nine months ended September 30, 2025 and 2024 are as follows:

	For the nine months ended
	September 30, 2025		September 30, 2024
Salaries	$	461,498	$	283,050

The Group’s key management includes registered directors who have important authority and responsibility for planning, operation, and control of the Group’s business activities.

No collateral or guarantee were provided for related parties and were received from related parties as of September 30, 2025 and December 31, 2024.

(20)

Administrative expenses

Details of administrative expenses for the nine months ended September 30, 2025 and 2024 are as follows:

	For the nine months ended September 30, 2025			For the nine months ended September 30, 2024
Salary	$	1,177,435		$	693,447
Retirement payment		401,338			93,458
Employee benefits		75,171			42,336
Travel expenses		31,655			31,020
Entertainment expenses		31,313			25,152
Communication cost		1,446			1,767
Tax and due		27,555			17,061
Depreciation cost		894			47,849
Amortization of intangible assets		7,010,647			8,488,493
Rental cost		75,423			74,728
Repair fee		3,386			141
Insurance cost		13,598			25,920
Vehicle maintenance fee		26,447			8,874
Allowance for expected credit losses		(5,634	)		26,322
Research and development expenses		141,880			146,679
Transportation cost		1,518			2,150
Training cost		1,223			-
Publishing fee		717			310
Office supplies fee		161			234
Consumable cost		10,260			18,221
Commisions and professional fee		3,373,415			969,879
Building management fee		13,822			15,398
Advertising expenses		-			954
Total	$	12,413,670		$	10,730,393

(21)

Income taxes

In assessing the reliability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based upon these considerations as of September 30, 2025 and December 31, 2024, the Company had a full valuation allowance for the net deferred tax assets on one of its Asian subsidiaries and certain of its European subsidiaries. Also, as of September 30, 2025 and December 31, 2024, the Company had a partial valuation allowance offsetting certain deferred tax assets of another one of its Asian subsidiaries. Management believes that it is more likely than not that the Company will realize the benefits of the remaining deductible differences, net of valuation allowances, at September 30, 2025 and December 31, 2024.

The Company did not have any material uncertain tax positions, which should be recognized in the condensed consolidated financial statements as of September 30, 2025. In addition, the Company did not have any unrecognized tax benefits, which, if recognized, would affect the effective tax rate for the nine months then ended.

(22) Loss per share

Basic loss per share for the nine months ended September 30, 2025 and 2024 are calculated as follows:

(The United States Dollar in unit and number of shares)	For the nine months ended September 30
	2025			2024
Net loss (A)	$	(13,187,995	)	$	(8,989,387	)
Weighted average number of ordinary shares outstanding (B)		17,375,710			2,155,000
Basic loss per ordinary share (A/B)	$	(0.76	)	$	(4.17	)

Weighted average number of ordinary shares outstanding for the nine months ended September 30, 2025 and 2024 are calculated as follows:

(Number of shares)	For the nine months ended September 30
	2025		2024
Ordinary shares outstanding at the beginning		2,155,000		2,155,000
Changes due to business combination		14,362,392		-
Commitment shares issued for White Lion Capital		201,703		-
Shares issued due to ELOC		195,156		-
Shares issued due to Convertible note conversion		232,402		-
Shares issued due to Warrant conversion		229,057		-
Weighted average number of ordinary shares outstanding		17,375,710		2,155,000

Diluted loss per share for the nine months ended September 30, 2025 and 2024 are calculated as follows:

(The United States Dollar in unit and number of shares)	For the nine months ended September 30
	2025			2024
Net loss (A)	$	(13,175,055	)	$	(8,989,387	)
Weighted average number of ordinary shares outstanding (B)		23,118,372			2,155,000
Diluted loss per ordinary share (A/B)	$	(0.57	)	$	(4.17	)

Weighted average number of ordinary shares including diluted effects outstanding for the nine months ended September 30, 2025 and 2024 are calculated as follows:

(Number of shares)	For the nine months ended September 30
	2025		2024
Weighted average number of ordinary shares outstanding beginning		17,375,710		2,155,000
Diluted effect) Convertible bonds conversion effect		403,807		-
Diluted effect) Warrant conversion effect		5,338,855		-
Weighted average number of ordinary shares outstanding		23,118,372		2,155,000

(23) Commitment and contingencies

The Group has no pending litigation cases arising in the ordinary course of business as of September 30, 2025 and December 31, 2024. The Parent has entered into various contractual commitments related to the acquisition of VAXIMM including a future financial obligation of CHF 7,416 underlying as of September 30, 2025. Meanwhile, both parties have agreed to remove section 6.1.3 of the license agreement that states that in the event of the Parent’s sale to a third party, the Licensor shall reimburse the Licensee for reasonable costs and expenses incurred in the preparation, submission, maintenance, prosecution, and enforcement process.

(24) Segment reporting

The Group operates in one operating segment. Operating segments are defined as components of an enterprise about which separate financial information is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and assessing performance. The Group’s CODM role is fulfilled by the Executive Leadership Team, who allocates resources and assesses performance based upon consolidated financial information. The geographic segments for the long-lived assets and ROU assets are disclosed below.

There are no external customers that account for more than 10% of sales for the reporting period.

(25) Subsequent events

The Group has evaluated subsequent events from the balance sheet date through November 3, 2025, the date at which the condensed consolidated financial statements were available to be issued and determined that there are no other items to disclose, except the following:

●

In October, the Group issued total of 2,001,571 shares under the warrants, to raise gross proceeds of $900,707.

●

In October, the Board of Directors of the Group approved the acquisition of Woori IO Co.,Ltd through a comprehensive share exchange with OSR Holdings Co., Ltd.

●

In October, the Company’s convertible loan from Duksung Co.,Ltd totaling $800,000 reached its maturity. The Company repaid $150,000 plus 5% accrued interest and the remaining balance of $650,000 was extended till October 15, 2026, with an interest rate of 7%.

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

References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to OSR Holdings, Inc. References to our “management” or our “management team” refer to our officers and directors. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act of 1934, as amended (the “Exchange Act”). We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those described in our other filings made with the U.S. Securities and Exchange Commission (“SEC”).

Recent Developments

Nasdaq Minimum Bid Price Deficiency Notice

On September 5, 2025, the Company received a notification from The Nasdaq Stock Market LLC (“Nasdaq”) stating that the Company was not in compliance with Nasdaq Listing Rule 5550(a)(2) after the closing bid price fell below USD 1.00 per share for 30 consecutive business days. The Company has been provided a grace period until March 4, 2026 to regain compliance by maintaining a closing bid price of at least USD 1.00 for ten consecutive business days.

Management is actively monitoring the Company’s share price performance and evaluating various available options to regain compliance within the applicable period, which may include corporate or capital structure adjustments, enhanced investor communications, and other strategic measures as appropriate. The Company intends to take all necessary actions to maintain its continued listing on the Nasdaq Capital Market.

Annual General Meeting and Board Changes

As previously reported in the Company’s Definitive Proxy Statement on Schedule 14A filed with the SEC on August 29, 2025 and Form 8-K filed on September 18, 2025, the Company held its annual meeting of stockholders on September 17, 2025 (the “Annual Meeting”). As of the record date of August 15, 2025, there were 21,585,360 shares of common stock outstanding and entitled to vote. A total of 13,325,691 shares (approximately 61.7% of the outstanding shares) were present in person or by proxy, constituting a quorum.

At the Annual Meeting, stockholders approved all proposals described in the Definitive Proxy Statement, including the following: (i) Director Proposal, (ii) Executive Compensation Proposal, (iii) Equity Incentive Plan Proposal, and (iv) Proposal to Exceed 20% Common Share Issuance Pursuant to Nasdaq Listing Rule 5635(d). No other matters were submitted for stockholder vote, and each of the four proposals was approved by the stockholders. As a result, the Board underwent the following changes: Reto Fierz was appointed as an Independent Director, and Jin Whan Park and Phil Geon Lee were removed.

The Board committees have been reconstituted as follows: Audit Committee - Reto Fierz and Hyuk Joo Jee, Compensation Committee - Seng Chin Mah, Alcide Barberis and Hyuk Joo Jee, Corporate Governance and Nominating Committee - Seng Chin Mah and Alcide Barberis and Joong Myung Cho. These changes reflect the Company’s ongoing commitment to strengthening corporate governance and enhancing strategic oversight.

Definitive Agreement to Acquire Woori IO Co., Ltd.

On October 14, 2025, the Company announced that its wholly owned Korean subsidiary, OSR Holdings Co., Ltd. (“OSRK”), entered into a definitive share exchange agreement with Woori IO Co., Ltd. (“WORIO”), a Korean medical-device company specializing in noninvasive glucose monitoring and biosensing technologies. Under the agreement, WORIO will become a wholly owned subsidiary of OSRK. WORIO shareholders will receive newly issued OSRK shares worth KRW15bn (~$10.5m) in exchange for WORIO shares. If, within 3 years of the share exchange, OSRH reaches at least $10 per share, OSRK shares may be converted into OSRH common stock at a ratio of 12.96:1 or approximately 1.09 million new shares. Following the acquisition, WORIO will leverage OSRH's governance, global partnerships and clinical development resources to accelerate product development, enhance supply readiness, and boost commercialization speed and efficiency

Results of Operations

Comparison of the Three and Nine Months Ended September 30, 2024 and 2025

The following tables present OSR Holdings’ statements of operations for the three and nine months ended September 30, 2024 and 2025, and percentage change between the two periods:

	Three Months Ended September 30,
	2024			2025			Change $		Change %
Net Sales:		822,996			627,747			-195,249		-24	%
Cost of Sales		643,903			366,014			-277,889		-43	%
Gross Profit		179,093			261,734			82,641		46	%
Expenses:
Selling, general and administrative expenses		3,745,635			4,065,199			319,564		9	%
Operating loss		(3,566,542	)		(3,803,465	)		-236,923		7	%
Other income (expense)		70,448			(686,361	)		-756,809		-1,074	%
Profit (loss) before income taxes		(3,496,094	)		(4,489,826	)		-993,732		28	%

	Nine Months Ended September 30,
	2024			2025			Change $		Change %
Net Sales:		2,615,051			2,524,536			-90,515		-3	%
Cost of Sales		1,963,835			2,061,335			97,500		5	%
Gross Profit		651,215			463,201			-188,014		-29	%
Expenses:
Selling, general and administrative expenses		10,730,393			12,413,670			1,683,277		16	%
Operating loss		(10,079,178	)		(11,950,469	)		-1,871,291		19	%
Other income (expense)		(23,392	)		(9,157,369	)		-9,133,977		39,047	%
Profit (loss) before income taxes		(10,102,570	)		(21,107,838	)		-11,005,268		109	%

Net Sales, Cost of Sales, Gross Profit

OSR Holdings’ net sales, cost of sales, and gross profit are primarily derived from RMC, its subsidiary engaged in the distribution of medical devices.

For the three months ended September 30, 2025, RMC’s net sales decreased by $195,249, or 24%, compared to the same period in the prior year. However, cost of sales decreased by $277,889, or 43%, resulting in an increase in gross profit of $82,641, or 46%.

This improvement in profitability was driven by a change in RMC’s contractual arrangement with one of its major suppliers. Specifically, RMC transitioned from a traditional purchase-and-resale model to a consignment-based arrangement under which only commission revenue is recognized. Although the new contract was executed in April, the change began to affect revenue recognition starting in July. Management expects this consignment-based model to enhance gross-margin stability in future periods.

For the nine months ended September 30, 2025, RMC’s net sales decreased by $90,515, or 3%, while cost of sales increased by $97,500, or 5%, compared to the same period in the prior year. As a result, gross profit decreased by $188,014, or 29%. The decline in gross profit for the nine-month period was primarily due to the impact of the second quarter, during which RMC sold previously held inventory back to the supplier at cost as part of the transition to the new consignment-based model. This transaction temporarily depressed gross margin in the second quarter, offsetting the margin improvement realized in the third quarter. The margin decline in the second quarter was a one-time event.

Selling, General and Administrative Expenses

For the three months ended September 30, 2025, OSR Holdings’ selling, general and administrative (SG&A) expenses increased by $319,564, or 9%, compared to the same period in the prior year.

For the nine months ended September 30, 2025, OSR Holdings’ selling, general and administrative (SG&A) expenses increased by $1,683,277, or 16%, compared to the same period in the prior year.

Following the completion of the Business Combination on February 14, 2025, various costs associated with fulfilling public company obligations began to rise. The increase was primarily attributable to higher personnel-related expenses, including salaries, severance payments, employee benefits, bonuses, and travel costs. Additional SG&A expenses included amortization of intangible assets, research and development expenses, and professional service fees such as legal, audit, investor relations, and press release costs, as well as non-income taxes, insurance premiums, and employee recruiting and training expenses. The most significant drivers of the increase were personnel-related costs and professional service fees.

Research and Development (R&D) Expenses

OSR Holding’s R&D expenses consisted primarily of development costs associated with our product candidates in pre-clinical and clinical trials, and related costs of salaries and contractors. R&D costs are expensed as incurred. OSR Holdings expects to incur and report R&D related expenses mainly from its subsidiaries actively engaged in R&D at an estimated amount of $2.5 million to $3.0 million per quarter beginning in 2026, which could potentially increase to $5.0 million to $6.0 million per quarter.

Operating Loss

For the three months ended September 30, 2025, OSR Holdings’ operating loss increased by $236,923, or 7%, compared to the same period in the prior year.

On a year-to-date basis, operating loss increased by $1,871,291, or 19%, for the nine months ended September 30, 2025.

As discussed in the section titled “Selling, General and Administrative Expenses,” this increase was primarily due to the rise in SG&A expenses beginning in the second quarter of 2025 following the completion of the Business Combination on February 14, 2025.

Other Income (Expense)

OSR Holdings’ other income (expense) consists of interest income, interest expense, foreign exchange-related gains and losses, and other non-operating items.

For the three months ended September 30, 2025, the Company recorded net other expenses of $686,361, representing an increase of $756,809 compared to the same period in the prior year. The primary drivers of this increase were the loss on change in fair value of financial liabilities and higher interest expense.

For the nine months ended September 30, 2025, net other expenses increased significantly to $9,157,369 from $23,392 in the prior-year period, an increase of $9,133,977. This substantial increase was primarily due to the one-time recognition of approximately $8.5 million in merger-related expenses incurred in connection with the Business Combination completed on February 14, 2025.

Loss Before Income Taxes

For the three months ended September 30, 2025, OSR Holdings’ loss before income taxes increased by $993,732, or 28%, compared to the same period in the prior year. As previously discussed, this increase was primarily attributable to higher expenses incurred following the completion of the Business Combination on February 14, 2025.

For the nine months ended September 30, 2025, loss before income taxes increased by $11,005,268, or 109%, compared to the same period in the prior year. This increase was primarily due to the one-time recognition of approximately $8.5 million in merger-related expenses incurred in connection with the Business Combination completed on February 14, 2025.

Liquidity and Capital Resources

Since its inception through September 30, 2025, OSR Holdings has incurred significant operating losses and negative cash flows from operating activities. The Company recorded an operating loss of approximately $10.08 million for the nine months ended September 30, 2024, and approximately $11.95 million for the same period in 2025. As of September 30, 2025, OSR Holdings had an accumulated deficit of approximately $32.33 million.

To date, OSR Holdings has funded its operations primarily through the issuance of common stock and convertible bonds, bank borrowings, loans from affiliates, and, to a lesser extent, product revenue generated by its subsidiary, RMC. As of September 30, 2025, the Company had cash and cash equivalents of approximately $2.18 million, consisting primarily of bank deposits.

The Company incurred significant expenses in connection with the business combination and the filing of its Form S-4 registration statement, which, together with other general expenses, reduced the funds available for operations and created an urgent need for additional capital. In response, in February 2025, OSR Holdings entered into an equity line of credit (“ELOC”) agreement with an investor, providing for up to $80 million in potential capital. As of September 30, 2025, the Company had issued a total of 767,500 shares under the ELOC, raising gross proceeds of $741,937. In addition, the Company has executed or is exploring various financing initiatives through the issuance of warrants and notes.

OSR Holdings expects to continue utilizing the ELOC and other available financing instruments to secure additional capital for its ongoing operations.

Off-Balance Sheet Arrangements

We have no obligations, assets or liabilities which would be considered off-balance sheet arrangements as of September 30, 2025. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

Contractual Obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations, purchase obligations or long-term liabilities, other than an agreement to pay an affiliate of Bellevue Capital Management, LLC (“BCM”) a monthly fee of $7,500, for office space, utilities and secretarial and administrative support. We began incurring these fees on March 1, 2023, and they continue following the consummation of our business combination in February 2025.

Chardan Capital Markets, LLC (“Chardan”) is entitled to a deferred underwriting commission of $2,070,000, payable as of September 30, 2025. In addition, we incurred deferred legal fees of approximately $1.25 million that were payable upon consummation of our initial business combination.

The holders of the founder shares, equity participation shares, placement units, and units that may be issued upon conversion of working capital loans (and in each case holders of their component securities, as applicable) are entitled to registration rights pursuant to the registration rights agreement. These holders are entitled to make up to two demands, excluding short form registration demands, that we register such securities for sale under the Securities Act. In addition, these holders will have “piggyback” registration rights to include their securities in other registration statements filed by us. We will bear the expenses incurred in connection with the filing of any such registration statements. Chardan may not exercise its demand and “piggyback” registration rights after five and seven years, respectively, after the date of our prospectus issued in connection with our IPO and may not exercise its demand rights on more than one occasion.

Critical Accounting Policies and Estimates

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have not identified any critical accounting estimates.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are a smaller reporting company as defined in Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.

Item 4. Controls and Procedures

Disclosure controls and procedures are controls and other procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

As required by Rules 13a-15 and 15d-15 under the Exchange Act, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, 2025.

In our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, management concluded that the material weaknesses previously identified in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, had been remediated and that our disclosure controls and procedures were effective as of that date. During the third quarter of 2025, management continued to monitor and test the operation of these controls and procedures and did not identify any new material weaknesses. Based on this evaluation, our management concluded that our disclosure controls and procedures were effective as of September 30, 2025.

We believe, however, that a controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls systems are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud or error, if any, within a company have been detected.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings

We may from time to time become subject to a range of actual or potential claims, lawsuits and other legal and administrative proceedings (including those described below) that may arise in the ordinary course of business. Some of these claims, lawsuits and other proceedings may range in complexity and result in substantial uncertainty; it is possible that they may result in damages, fines, penalties, non-monetary sanctions, or relief.

In March and May of 2025, Company Management became aware of a civil action filed against the Company by Benjamin Securities, Inc., in Supreme Court, New York County, seeking $425,000.00 in brokerage fees and costs that the plaintiff alleges are due and owing. As of September 30, 2025, the matter remains pending.

On September 2, 2025, Chardan Capital Markets, LLC filed a complaint (the “Complaint”) in the United States District Court for the Southern District of New York against the Company and Kuk Hyoun Hwang (Chardan Capital Markets, LLC v. OSR Holdings, Inc. et al., No. 1:25-cv-07285-SHS). The Complaint asserts claims for breach of contract and related causes of action. The case has been assigned to Judge Sidney H. Stein, with Magistrate Judge Robert W. Lehrburger designated to handle matters that may be referred in this action.

Service of process was waived on September 5, 2025, and an answer to the Complaint was filed on November 4, 2025. On October 6, 2025, the Court entered a Civil Case Management Plan and Scheduling Order setting discovery deadlines and scheduling a status conference for January 8, 2026, before Judge Stein. The matter is currently in the early discovery stages.

Item 1A. Risk Factors

In addition to the risk factors set forth below and the other information set forth in this report, you should carefully consider the factors discussed under Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed with the SEC on April 22, 2025 (or “2024 Annual Report”), and in the other reports we file with the SEC before making a decision to invest in our securities. These factors could materially adversely affect our business, financial condition, liquidity, results of operations and capital position, and could cause our actual results to differ materially from our historical results or the results contemplated by the forward-looking statements contained in this report or we could face liquidation. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. The risks and uncertainties described in our 2024 Annual Report and below are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business, financial condition and operating results. Except as disclosed below, there have been no material changes to the risk factors described in Part I, Item 1A, “Risk Factors,” included in our 2024 Annual Report.

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

Pursuant to the terms of an Equity Line of Credit Agreement comprising a Common Stock Purchase Agreement and a Registration Rights Agreement (taken together, the “ELOC Agreement”) as amended May 6, 2025, the Company may elect, in our sole discretion, to issue and sell to by White Lion Capital LLC dba White Lion GBM Innovation Fund (“White Lion”), from time to time, up to $78.9 million worth of shares of Common Stock from after the effective date of a related registration statement until the earlier of December 31, 2026 or the sale of all of such shares to White Lion. Any terms in initial capitals and not otherwise defined herein shall be as defined in the amended Common Stock Purchase Agreement and/or the Registration Rights Agreement.

Pursuant to the Common Stock Purchase Agreement, following the effective date of the resale registration statement registering the shares issuable to White Lion in accordance with the terms of the Registration Rights Agreement, the Company has the right, but not the obligation, to require White Lion to purchase, from time to time, up to the lesser of (i) $78,900,000 in aggregate gross purchase price of newly issued shares of Common Stock, par value $0.0001 per share and (ii) 3,853,467 shares of Common Stock (the “Exchange Cap”), in each case, subject to certain limitations and conditions set forth in the Common Stock Purchase Agreement.

The number of shares of Common Stock that the Company may require White Lion to purchase in any single sales notice will depend on a number of factors, including the relevant calculated purchase price and type of purchase notice that the Company delivers to White Lion. For example: (1) if the Company were to deliver a Rapid Purchase Notice, the Company can require White Lion to purchase a number of shares equal to $2,000,000 divided by the average of the three (3) lowest traded prices of the Common Stock on the Rapid Purchase Notice Date; and (2) if the Company were to deliver a VWAP Purchase Notice, the Company can require White Lion to purchase a number of shares equal to $2,000,000 divided by the product of (i) the lowest daily VWAP of the Common Stock during the VWAP Purchase Valuation Period and (ii) ninety-seven percent (97%).

White Lion’s purchase obligations under a single Rapid Purchase Notice or a single VWAP Purchase Notice shall not exceed $2,000,000, and the maximum amount of shares of Common Stock the Company may require White Lion to purchase under a single VWAP Purchase Notice shall be the lesser of (A) 30% of the Average Daily Trading Volume or (B) $2,000,000 divided by the highest closing price of the Common Stock over the most recent five (5) Business Days immediately preceding White Lion’s receipt of the subject VWAP Purchase Notice.

Additionally, in consideration for White Lion’s commitments under the Common Stock Purchase Agreement, the Company agreed to issue to White Lion the number of shares of Common Stock equal to $800,000 divided by the closing price of the Common Stock on the day that is the earlier of (i) the business day prior to effectiveness of this resale registration statement registering the shares issuable under the Common Stock Purchase Agreement and (ii) the business day prior to the date that White Lion requests the issuance of such shares (such shares, the “Commitment Shares”).

Accordingly, the actual number of shares of our Common Stock issuable will vary depending on the then-current market price of shares of Common Stock sold to White Lion under the ELOC Agreement, but will not exceed the number set forth in the preceding paragraphs unless we file an additional registration statement under the Securities Act of 1933, as amended (the “Securities Act”), with the SEC.

Warrants

Pursuant and subject to the terms of the ELOC Agreement and as further subject to the terms of a Common Stock Purchase Warrant dated May 6, 2025 between the Company and White Lion (“Warrant”), White Lion has the right, but not the obligation, at any time for a period of five years following the Warrant’s execution date, to subscribe for and purchase from the Company up to $4,000,000 worth, or the Available Share Amount (as defined in the Warrant and subject to adjustment thereunder), of Common Stock (the “Warrant Shares”). The initial purchase price of one share of Common Stock under the Warrant shall be equal to the Exercise Price, which shall be $1.584 or as otherwise defined therein pursuant to any applicable adjustments to the same.

Convertible Note

Pursuant and subject to the terms of a Convertible Note Purchase Agreement and executed on May 6, 2025 between the Company and White Lion (the “Note Purchase Agreement”) and related convertible promissory notes (“Convertible Notes”), White Lion has agreed to loan the Company the principal amount of $1,110,000 at an interest rate of 5% per annum subject to two Convertible Notes maturing on the date occurring Nine (9) months after the closing date of each respective loan. The first Convertible Note in the principal amount of $445,000 was executed by and between the Company and the White Lion on May 6, 2025. The second Convertible Note, constituting the balance of the principal amount under the Note Purchase Agreement, was executed by and between the Company and the White Lion on June 20, 2025.

The Company has agreed to allocate 10% of the proceeds from each purchase notice under the ELOC and/or warrant exercise toward the repayment of the outstanding Convertible Note(s). At any time, White Lion may convert one or both Convertible Notes at 95% multiplied by the lowest Volume Weighted Average Price (“VWAP”) fifteen days prior to the conversion notice. The Company and the Investor have agreed that no more than 4.99% of the shares outstanding will be issued to White Lion, which can be adjusted to up to 9.99% upon 61 prior days’ notice from White Lion.

Under certain circumstances, issuances of Common Shares under the ELOC, Warrants and Convertible Note may have significantly dilutive effect upon the Company’s existing shareholders.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

During the nine months ended September 30, 2025, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Item 6. Exhibits

The following exhibits are being filed herewith, or incorporated by reference into, this Quarterly Report on Form 10-Q and are numbered in accordance with Item 601 of Regulation S-K:

EXHIBIT INDEX

Exhibit No.		Description
10.1		Note Purchase Agreement, dated as of May 6, 2025, between OSR Holdings, Inc. and White Lion Capital, LLC.
10.2		Senior Secured Convertible Promissory Note, issued May 6, 2025, by OSR Holdings, Inc. to White Lion Capital LLC.
10.3		Common Stock Purchase Warrant, issued May 6, 2025, by OSR Holdings, Inc to White Lion Capital, LLC.
10.4		Amendment No. 1 to Common Stock Purchase Agreement, between OSR Holdings, Inc. and White Lion Capital LLC.
31.1		Certification of Principal Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 *
31.2		Certification of Principal Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 *
32.1		Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 **
32.2		Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 **
101.INS		Inline XBRL Instance Document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document.
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

SIGNATURE

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

Dated: November 12, 2025

OSR HOLDINGS, INC.

By:	/s/ Kuk Hyoun Hwang
	Name:	Kuk Hyoun Hwang
	Title:	Chief Executive Officer

By:	/s/ Gihyoun Bang
	Name:	Gihyoun Bang
	Title:	Chief Financial Officer

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