Dr. Frederick Sancilio reports

LOBE SCIENCES REPORTS FISCAL 2025 RESULTS AND HIGHLIGHTS STRATEGIC TRANSFORMATION FOLLOWING LEADERSHIP TRANSITION

Lobe Sciences Ltd. has released its audited financial results for the fiscal year ended Aug. 31, 2025 (fiscal 2025), and has provided an update on operational progress achieved since the company's leadership transition and board renewal beginning in late 2024.

Dr. Frederick D. Sancilio, chairman and chief executive officer of Lobe Sciences, stated: "During fiscal 2025, our focus was on strengthening the company's financial position, reducing legacy liabilities and ensuring that our core assets were funded in a manner that preserved long-term shareholder participation. By advancing L-130 (psilocin mucate) through Cynaptec Pharmaceuticals Inc. and completing financing at the subsidiary level, we were able to secure capital for development while minimizing dilution at Lobe. We believe this approach better reflects the underlying value of the asset and provides a clearer path to advancing our programs without significant dilution of the Lobe shareholders."

Fiscal 2025 financial highlights

Lobe made significant progress strengthening its balance sheet and improving liquidity during fiscal 2025:

• Cash increased to $5,854,118 on Aug. 31, 2025, compared with $237,772 on Aug. 31, 2024;
• Short-term investments of $1,686,688 were held on Aug. 31, 2025 (none reported on Aug. 31, 2024);
• Working capital improved to a surplus of $5,163,526, compared with a deficit of $2,008,849 on Aug. 31, 2024;
• Convertible notes (current portion) decreased to nil on Aug. 31, 2025, from $641,374 on Aug. 31, 2024;
• Derivative liability decreased to $205,105 on Aug. 31, 2025, from $603,724 on Aug. 31, 2024.

For fiscal 2025, the company reported a net loss attributed to the parent company of $4,861,611 (fiscal 2024: $4,420,727). Loss per share was three cents for fiscal 2025 compared with four cents for fiscal 2024, despite significant balance-sheet restructuring, and increased investment in corporate infrastructure and development activities.

Management believes the strengthened working capital position significantly reduces liquidity risk and enhances the company's ability to execute business development initiatives.

Strategic transformation and operating progress since leadership transition

Following the company's leadership transition and board renewal beginning in late 2024, Lobe undertook an extensive operational and financial stabilization program designed to improve corporate governance, strengthen disclosure practices, reduce legacy balance-sheet complexity, and position the company to pursue value-accretive transactions and financing alternatives aligned with shareholder interests.

In fiscal 2025, this transformation translated into a materially improved liquidity position and a clearer corporate structure focused on two core strategic development programs advanced through subsidiaries.

Product development overview

Lobe is advancing two strategic development programs through its subsidiaries:

1. Cynaptec Pharmaceuticals Inc. (64 per cent owned by Lobe) -- L-130 for chronic cluster headache (lead program) and substance use disorder, with other indications under strategic review;
2. Altemia Inc. -- S-100, an early stage drug product candidate for sickle cell disease.

In addition to these two continuing programs, the company continues to evaluate other strategic opportunities consistent with its business strategy.

Cynaptec Pharmaceuticals Inc.: L-130 -- a CNS therapeutic

L-130 is a novel, patented, oral, stable analog of psilocin, the active metabolite of the pro drug psilocybin, designed to enhance bioavailability and therapeutic efficacy. Psilocin has been identified as having therapeutic potential in a variety of neurological conditions. The lead indication for L-130 is chronic cluster headache, a neurological condition with limited treatment options and significant unmet clinical need.

As described in the company's MD&A (management's discussion and analysis), a phase 1a study in healthy volunteers and supporting preclinical work have been completed internationally under applicable standards, and the company is continuing to advance the development plan and partnership strategy in line with United States FDA (Food and Drug Administration) guidance received in its pre-IND correspondence.

Altemia Inc.: S-100 -- sickle cell disease drug product candidate

In fiscal 2025, Lobe sharpened its focus within the sickle cell disease program by prioritizing S-100, an early stage therapeutic candidate intended to address the underlying pathology of the disease. S-100 utilizes a patented drug delivery platform and comprises a complex blend of lipid-based active ingredients, primarily docosahexaenoic acid and eicosapentaenoic acid in triglyceride form with pharmaceutical-grade surfactants.

Separately, the company is also conducting preliminary and limited commercialization activities for a proprietary medical food intended to address nutritional deficiencies often observed in patients with sickle cell disease. Current efforts are focused primarily on pursuing third party reimbursement authorization, and there can be no assurance reimbursement will be obtained or that the medical food will be commercially viable. If reimbursement is not achieved, the company may pursue alternative strategies or discontinue commercialization efforts.

Capital and potential value-creation strategy

The company's value creation strategy is focused on advancing and realizing the intrinsic value of its existing research and development assets, while continuing to evaluate additional development opportunities consistent with its business strategy.

During fiscal year 2025, the company's market capitalization remained below $5-million. Under these conditions, raising capital at the parent-company level was challenging, as even relatively small financings would have resulted in significant dilution to existing shareholders. Management believes that, during this period, the public market did not fully reflect the underlying value of the company's research and development assets.

In response, the company transferred its L-130 program into its wholly owned subsidiary, Cynaptec. The company subsequently completed a financing at the subsidiary level, raising $8.46-million at a postmoney valuation of $22.56-million. Following the completion of this financing, the company retained a 64-per-cent ownership interest in Cynaptec.

Management believes this transaction represents an important milestone in the company's strategy, as it supports the advancement of the L-130 program, provides capital at the subsidiary level without dilution to the company's shareholders, and preserves meaningful long-term participation in the program's potential value.

Outlook for FY2026

In FY2026, the company expects to continue building on fiscal 2025 progress by further strengthening corporate infrastructure, advancing its core development programs through disciplined milestone execution and evaluating strategic opportunities intended to maximize shareholder value. The timing, structure and outcomes of any such initiatives remain subject to market conditions, financing availability, regulatory considerations and other factors.

About Lobe Sciences Ltd.

Lobe Sciences is a biopharmaceutical company advancing programs in diseases with unmet medical needs. The company is pursuing strategic development through its subsidiaries, including a majority interest in Cynaptec Pharmaceuticals Inc. and wholly owned subsidiary Altemia Inc.

We seek Safe Harbor.