425: Glucotrack Completes Merger, Lokahi Therapeutics Reports Increased Losses

Glucotrack, Inc. filed an amendment to its Form 8-K to include financial statements for Lokahi Therapeutics Inc. following a reverse merger, revealing a significant increase in Lokahi's net loss and ongoing going concern issues.

Summary

• This filing is an amendment to a previous Form 8-K, primarily to include the financial statements and pro forma information related to the reverse merger between Glucotrack, Inc. and Lokahi Therapeutics Inc.
• Lokahi Therapeutics Inc. reported a net loss of $8,098,087 for the six months ended June 30, 2026, a substantial increase from $3,064,590 in the same period of 2025.
• Total operating expenses for Lokahi increased significantly to $5,958,612 for the six months ended June 30, 2026, up from $3,028,272 in the prior year period.
• As of June 30, 2026, Lokahi had an accumulated deficit of $8,799,232 and a working capital deficit of $6,846,937.
• The company has no committed source of additional financing and relies on loans and advances, raising substantial doubt about its ability to continue as a going concern.
• The merger between Glucotrack and Lokahi was completed on July 14, 2026, with Lokahi becoming a wholly owned subsidiary of Glucotrack.
• Pro forma combined statements show a significant net loss for the six months ended June 30, 2026, of $19,699,822 for the combined entity.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this filing as negative due to the significant increase in net loss, substantial operating expenses, and the ongoing substantial doubt about the company's ability to continue as a going concern, despite the completion of a merger.

Positives

• The merger between Glucotrack and Lokahi Therapeutics has been completed, creating a combined entity.
• Lokahi Therapeutics has a proprietary method for developing Apitox, a purified honeybee venom-based drug candidate for knee osteoarthritis pain and inflammation.
• The company has secured a license for its product candidate in the United States from Apimeds Korea.
• Pro forma combined balance sheet shows a significant increase in cash and cash equivalents to $10,617,827 as of June 30, 2026, post-merger.

Negatives

• Lokahi Therapeutics reported a net loss of $8,098,087 for the six months ended June 30, 2026, a significant increase from $3,064,590 in the prior year period.
• Total operating expenses for Lokahi increased by $2,930,340 to $5,958,612 for the six months ended June 30, 2026.
• The company has an accumulated deficit of $8,799,232 as of June 30, 2026.
• Lokahi Therapeutics has a working capital deficit of $6,846,937 as of June 30, 2026.
• There is substantial doubt about Lokahi Therapeutics' ability to continue as a going concern due to recurring losses and negative cash flows.
• The combined pro forma net loss for the six months ended June 30, 2026, is $19,699,822.
• The company has no committed source of additional financing.

Risks

• Substantial doubt exists regarding Lokahi Therapeutics' ability to continue as a going concern due to recurring losses and negative cash flows from operations.
• The success of the Company is dependent on obtaining necessary regulatory approvals for its product candidate, Apitox.
• The company has no committed source of additional financing and may not be able to obtain it on acceptable terms.
• Alto Opportunity Master Fund B has contacted the company regarding settlement of a note owed by APUS, asserting potential responsibility for the company and indicating intent to pursue litigation.
• The company is in the development stage and has not yet generated revenue from its biopharmaceutical operations.
• The outcome of future research and development activities is unpredictable.

Future Outlook

The company expects to continue incurring substantial losses in the future. Its success is dependent on obtaining regulatory approvals for its product candidate and securing additional financing, the outcomes of which are uncertain.

Management Comments

• Management states that the financial statements have been prepared assuming the Company will continue as a going concern, but notes that recurring losses and negative cash flows raise substantial doubt about its ability to continue as a going concern.
• Management expects to continue to incur substantial losses in the future.
• There can be no assurance that the Company will be able to obtain additional financing on terms acceptable to it or at all.

Industry Context

StockSavvy.ai notes that this filing reflects a common scenario in the biopharmaceutical industry where development-stage companies incur significant R&D and G&A expenses with no immediate revenue, heavily relying on external financing and facing substantial regulatory hurdles. The merger with Glucotrack suggests a strategy to gain access to capital markets or leverage existing infrastructure.

Comparison to Industry Standards

• Development-stage biopharmaceutical companies typically operate at a loss for extended periods, investing heavily in R&D. Lokahi's net loss of $8.1 million for six months and $8.7 million for the year 2025 is consistent with this industry trend.
• The reliance on external financing, including related party notes and short-term promissory notes, is a common practice for companies in this sector lacking operational revenue.
• The 'going concern' warning is prevalent among early-stage biotech firms, highlighting the inherent risk and capital intensity of drug development.
• The pro forma combined net loss of nearly $20 million for six months indicates the significant financial scale of the combined entity, which is still in a pre-revenue phase, a characteristic shared by many peers in the biotech space.

Legal Proceedings

• Alto Opportunity Master Fund B has contacted the company regarding settlement of a senior secured convertible note owed by APUS, asserting that the Company may bear responsibility and indicating intent to pursue litigation against APUS, the Company, and certain officers/directors. The specific legal basis and amount sought from the Company are not yet identified, and no formal proceedings have commenced against the Company.

Related Party Transactions

• Lokahi Therapeutics has outstanding related party notes payable to Inscobee Inc. totaling $500,100 as of June 30, 2026, with accrued interest.
• The company assumed these related party notes as part of a Settlement Agreement executed on April 24, 2026.
• The Settlement Agreement involved the forgiveness or assumption of various assets and liabilities between Lokahi, its Parent (APUS), and other related entities.
• As part of the Settlement Agreement, APUS agreed to assign the Prevail CRO credit facility and rights under a license agreement to Lokahi.

Stakeholder Impact

• Shareholders of Glucotrack may experience dilution due to the significant issuance of stock as merger consideration and potential future capital raises.
• Shareholders of Lokahi Therapeutics have converted their holdings into Glucotrack stock, now holding a majority stake in the combined entity.
• Creditors and lenders face increased risk due to the company's ongoing losses, negative cash flow, and substantial doubt about its going concern status.
• Employees may face uncertainty regarding job security given the company's development-stage status and financial challenges.

Next Steps

• Lokahi Therapeutics will continue its clinical development of Apitox for knee osteoarthritis.
• The combined entity will pursue regulatory approvals for its product candidate.
• The company will seek additional financing to fund its operations and development activities.
• Glucotrack will integrate Lokahi's operations and pursue its strategic objectives.

Key Dates

Recommendation

The filing reveals a worsening financial situation for Lokahi Therapeutics, with significantly increased losses and a continued going concern warning. While the merger with Glucotrack provides a new corporate structure, the combined entity's pro forma financials show a substantial net loss and ongoing reliance on external financing. The unresolved legal matter with Alto Opportunity Master Fund B adds further risk. Given the pre-revenue status, high cash burn, and significant uncertainties, a sell recommendation is warranted for seasoned investors.

Keywords

Lokahi Therapeutics, Glucotrack, Merger, Reverse Merger, Biopharmaceutical, Apitox, Knee Osteoarthritis, Financial Statements