SciSparc Ltd. Annual Report - How They Did This Year

I’ve put together this guide to help you understand SciSparc Ltd.’s performance. My goal is to turn complex filing data into clear information to help you decide if this company fits your investment goals.

1. What does this company do and how did they perform?

SciSparc Ltd. is an Israeli clinical-stage pharmaceutical company. Think of them as a research lab; they aren't selling mass-market drugs yet. They are currently developing and testing new treatments.

Their core business has two parts:

• Cannabinoid-based Pharmaceuticals: They develop treatments using cannabis compounds. Key projects include SCI-110, currently in a Phase IIa trial for Tourette syndrome, and SCI-210, designed for Autism Spectrum Disorder and status epilepticus.
• Nutraceuticals: They sell hemp seed oil products on Amazon. This provides a small secondary income while their main drug pipeline remains in development.

The Big Picture: The company recently moved its research and nutraceutical business under NeuroThera Labs. This subsidiary aims to streamline operations and attract new investment. They also completed two "reverse stock splits"—a 21-to-1 split in July 2025 and a 9-to-1 split in March 2026—to consolidate shares and meet Nasdaq’s minimum price requirements.

2. Financial Health: Are they making money?

In short: No, they are losing money.

Because they focus on research, they don't sell drugs to the public yet. Their losses have grown as they fund clinical trials and daily operations:

• 2023: Lost $5.9 million
• 2024: Lost $7.5 million
• 2025: Lost $12.6 million

By the end of 2025, their total losses reached $87 million. With only $4.6 million in cash remaining, the company lacks the funds to operate for the next 12 months. Their nutraceutical sales cannot cover the high costs of pharmaceutical research.

3. What should you watch out for? (The Risks)

Beyond the usual risks of drug development, keep these red flags in mind:

• The "Going Concern" Warning: Their accountants doubt the company can stay in business. This means they are running out of cash and must raise more money soon to keep the lights on. Without new capital, they may have to shut down.
• The AutoMax Loss: A planned merger with AutoMax failed, and AutoMax went insolvent. SciSparc had to write off nearly $6 million in loans to them. This hit their cash reserves hard and hurt their ability to pay bills.
• Dilution: Since they have no drug revenue, they survive by selling more shares. This means more shares are issued, reducing your ownership percentage and the value of your current holdings.
• High Failure Risk: There is no guarantee their drugs will win FDA approval. Even if they do, the company faces the expensive challenge of building a sales team or finding a larger partner to license their drugs.

Bottom Line: SciSparc is a high-risk, speculative investment. They are burning through cash, suffered a major loss from a failed merger, and depend on finding new investors just to continue their research. Before investing, ask yourself if you are comfortable with the high probability of further share dilution and the company's current struggle to maintain enough cash to fund its operations.