INFLARX N.V. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - JUNE 30, 2019 These unaudited condensed financial statements are consolidated financial statements for the group consisting of InflaRx N.V. and its who

UNAUDITED CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS - JUNE 30, 2019

These unaudited condensed financial statements are consolidated financial statements for the group consisting of InflaRx N.V. and its wholly-owned subsidiaries InflaRx GmbH, and InflaRx Pharmaceutical Inc., Ann Arbor,

Michigan, United States (together, the "Group"). The financial statements are presented in Euro ( ).

InflaRx N.V. is a company limited by shares, incorporated and domiciled in Amsterdam, The Netherlands.

Its registered office and principal place of business is in Germany, Jena, Winzerlaer Str. 2.

All press releases, financial reports and other information are available in the investor's register on our website: www.inflarx.de

INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

THREE AND SIX MONTHS ENDED JUNE 30, 2019

InflaRx N.V. and subsidiaries

Unaudited Condensed Consolidated Statements of Comprehensive Loss

for the three and six months ended June 30, 2019 and 2018,

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

InflaRx N.V. and subsidiaries

Unaudited Condensed Consolidated Statements of Financial Position

as of June 30, 2019 and December 31, 2018

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

InflaRx N.V. and subsidiaries

Unaudited Condensed Consolidated Statements of Changes in Shareholders' Equity

for the six months ended June 30, 2019 and 2018

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

InflaRx N.V. and subsidiaries

Unaudited Condensed Consolidated Statements of Cash Flows

for the six months ended June 30, 2019 and 2018

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

InflaRx N.V. and subsidiaries

Notes to the Unaudited Condensed Consolidated Financial Statements

1. Net Financial Result

The net financial result is comprised of the following items for the three and six months ended June 30:

On the reporting date, assets and liabilities are translated at the closing rate. Any foreign exchange rate di erences derived from these translations are recognized in the consolidated statement of profit or loss as part of finance income.

Interest income results from marketable securities held by the Company and short-term deposits in U.S. Dollar held by the Company and its subsidiary InflaRx GmbH.

Foreign exchange income and expense is mainly derived from the translation of the U.S. Dollar cash and cash equivalents held by InflaRx GmbH. These funds are translated at the exchange rates prevailing on the reporting date. Any resulting

translation di erences are recognized in pro t or loss. U.S. Dollar denominated funds of the Company do not materially impact foreign exchange results, as the Company has changed its functional currency from Euro to U.S. Dollar.

2. Other non-financial assets

Prepaid expense mainly consists of accrued insurance expense for Directors and Officers and insurance expenses together with the placement of shares in May 2018. The increase is also reflected in our higher insurance expenses. Current tax

assets in 2019 include tax reclaims because of capital gains tax deductions on securities interest payments. The increase is due to the securities purchased in the third quarter of 2018.

3. Financial assets and financial liabilities

Set out below is an overview of financial assets and liabilities, other than cash and short-term deposits, held by the Group as at June 30, 2019 and December 31, 2018:

The fair value of current and non-current financial assets (primarily quoted debt securities with, credit ratings ranging from AA- to AAA) amounted to 84,164 thousand (level 1). The Group's debt instruments at amortized cost consist solely of

quoted securities that are graded in the top investment category (AA- to AAA) by credit rating agencies such as S&P Global and, therefore, are considered low credit risk investments. Based on statistical historical probabilities of default,

adjusted for forward-looking factors specific to the debtors and the economic environment, the Group believes that the expected credit losses for these debt instruments are immaterial. Furthermore, since the acquisition of these debt securities,

their credit ratings have remained stable.

4. Cash and cash equivalents information

5. Related party transactions

The Group's executive management comprises the following persons:

Professor Niels C. Riedemann, Chief Executive Officer (CEO)

Professor Renfeng Guo, Chief Scientific Officer (CSO)

Arnd Christ, Chief Financial Officer (CFO)

Jason Marks, Chief Legal Officer, General Counsel (CLO)

Othmar Zenker, Chief Medical Officer (CMO)

The Group's board of directors comprises the following persons:

Professor Niels C. Riedemann, CEO

Professor Renfeng Guo, CSO

Non-executive Directors

Nicolas Fulpius, Chairman of the board of directors and Chairman of the Audit Committee

Jens Holstein, Member of the Audit Committee

Anthony Gibney, Member of the Audit Committee, until June 11, 2019

Richard Brudnick, since May 23, 2019.

The compensation of the Group's executive management comprises the following for the three and six months ended June 30:

Remuneration of InflaRx's executive management consists of fixed and variable components and share-based payment awards. In addition, the executive management receives supplementary benefits and allowances.

We entered into indemnification agreements with our directors and senior management. The indemnification agreements and our articles of association require us to indemnify our directors and certain officers and employees as designated by our

board of directors to the fullest extent permitted by law.

6. Share-based payments

1. Equity settled share-based payment arrangements

In the course of its historical financing rounds, InflaRx GmbH established equity-settled share-based payment programs. Under these programs, the Company granted its managing directors and senior executives options to acquire InflaRx GmbH's

common shares. In total, options covering 6,088 common shares have been granted. All of the options have vested. The InflaRx GmbH options were converted into options covering 511,392 common shares of InflaRx N.V. at the initial public offering in

November 2017. The exercise prices for each outstanding award is 0.01 per share or less.

Under the terms and conditions of the 2016 stock option plan (the "2016 Stock Option Plan"), InflaRx GmbH granted rights to subscribe for InflaRx GmbH's common shares to directors, senior management and key employees. Prior to the initial

public offering, the outstanding awards under the 2016 plan covered an aggregate of 1,239,252 common shares and the exercise price for each outstanding award was 7.81 per share (in each case after giving effect to the corporate reorganization in

November 2017). Any additional awards available under the 2016 plan lapsed upon the closing of the Series D financing in October 2017. In 2016, InflaRx also established a share-based payment plan for its non-executive board members and granted

options covering 484 shares. Grants under this plan were not subject to service or performance conditions.

In conjunction with the closing of its initial public offering, InflaRx N.V. established a new incentive plan (the "2017 Long-Term Incentive Plan"). The initial maximum number of common shares available for issuance under equity incentive

awards granted pursuant to the 2017 Long Term Incentive Plan equals 2,341,097 common shares. The number of share options under the plan was as follows:

In the fourth quarter of 2018 75,000 stock options were awarded subject to a specified condition, which was satisfied in the first quarter of 2019. Therefore, the expense for these stock options occurred in 2019.

On January 1, 2021 and on January 1 of each calendar year thereafter, an additional number of shares equal to 3% of the total outstanding common shares on December 31 of the immediately preceding year (or any lower number of shares as

determined by the board of directors) will become available for issuance under equity incentive awards granted pursuant to the 2017 Long-Term Incentive Plan.

2. Stock options exercised

In 2018, 302,279 shares were issued following the exercise of stock options, resulting in proceeds to the Company in the amount of 452.0 thousand. All stock options exercised were granted under the 2016 Stock Option Plan. In the first two

quarters of 2019, no stock options were exercised.

3. Measurement of fair values of stock options granted

The fair value of options granted in the six months ended June 30, 2019 under the 2017 Long-Term Incentive Plan was determined using the Black-Scholes valuation model. Since the Company's common shares are listed on the Nasdaq Global Select

Market, the closing price of the common shares at grant date was used.

Other significant inputs into the model are as follows (weighted average):

Expected volatility has been based on an evaluation of the historical and implied volatility of a peer group of companies. The range of outcomes for the expected life of the instruments has been based on expectations on option holder behavior

in the scenarios considered.

The dividend yield has no impact due to the anti-dilution clause as defined in the LTI.

Expenses are determined based on the number of stock options granted within a tranche and the vesting period of a tranche. This implies two effects:

the more options are granted within a tranche, the higher the expense of a tranche is, and