Phio Pharmaceuticals Reports Second Quarter 2024 Financial Results and Provides Business Update

Phio Pharmaceuticals Reports Second Quarter

Financial Results and Provides Business Update

MARLBOROUGH, Mass., August 14, 2024-Phio Pharmaceuticals Corp.

(Nasdaq: PHIO), a clinical stage biotechnology company whose proprietary INTASYL siRNA gene silencing technology is designed to

make immune cells more effective in killing tumor cells, today reported its financial results for the quarter ended June 30, 2024 and

provided a business update.

Recent Corporate Updates

At June 30, 2024, the Company had cash of $4.7 million as compared

with $8.5 million at December 31, 2023.

In July 2024, the Company entered into inducement letter agreements

with certain holders of the Company's existing warrants to purchase up to an aggregate of 545,286 shares of common stock at a reduced

exercise price of $5.45 per share. In consideration for the immediate exercise of the existing warrants, the Company agreed to issue five

and one-half year term Series C warrants to purchase up to 583,098 shares of common stock and eighteen month term Series D warrants to

purchase up to 507,474 shares of common stock, both at an exercise price of $5.45. The net proceeds to the Company are expected to be

approximately $2.6 million, after deducting placement agent fees and offering expenses.

Research and Development Expenses

Research and development expenses were $0.9 million for the three months

ended June 30, 2024 as compared with $1.4 million for the three months ended June 30, 2023, a decrease of 37%. The decrease was primarily

driven by a decrease in clinical consulting fees incurred in connection with our IND filing for PH-762 in the prior year period in addition

to the Company's cost rationalization measures in transitioning from a research company to a product development company resulting

in decreases in salary-related costs, including stock-based compensation expense, and lab supplies associated with the reduction in headcount.

General and Administrative Expenses

General and administrative expenses were $1.0 million for the three

months ended June 30, 2024 as compared with $1.2 million for the three months ended June 30, 2023, a decrease of 10%. The decrease was

primarily due to decreases in salary-related expenses for the Company's President & CEO and in professional fees related to

consulting as compared to the prior year period.

Net loss was $1.8 million for the three months ended June 30, 2024

as compared with $2.5 million for the three months ended June 30, 2023. The decrease in net loss was primarily due to the changes in research

and development expenses, as described above.

About Phio Pharmaceuticals Corp.

Phio Pharmaceuticals Corp. (Nasdaq: PHIO) is a clinical stage biotechnology

company whose proprietary INTASYL siRNA gene silencing technology is designed to make immune cells more effective in killing tumor

cells. INTASYL is the only self-delivering RNAi technology focused on immuno-oncology therapeutics without the need for specialized formulations

or drug delivery systems. INTASYL drugs precisely down regulate specific proteins that inhibit the body's ability to overcome chronic

diseases and other disorders.

For additional information, visit the Company's website, www.phiopharma.com.

Forward Looking Statements

This press release contains forward-looking statements within the

meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as "intends,"

"believes," "anticipates," "indicates," "plans," "expects," "suggests," "may,"

"would," "should," "potential," "designed to," "will," "ongoing," "estimate,"

"forecast," "target," "predict," "could" and similar references, although not all forward-looking

statements contain these words. These statements are based only on our current beliefs, expectations and assumptions and are subject to

inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control.

Our actual results may differ materially from those indicated in the forward-looking statements as a result of a number of important factors,

including, but not limited to, the impact to our business and operations by inflationary pressures, rising interest rates, recession fears,

the development of our product candidates, results from our preclinical and clinical activities, our ability to execute on business strategies,

our ability to develop our product candidates with collaboration partners, and the success of any such collaborations, the timeline and

duration for advancing our product candidates into clinical development, the timing or likelihood of regulatory filings and approvals,

the success of our efforts to commercialize our product candidates if approved, our ability to manufacture and supply our product candidates

for clinical activities, and for commercial use if approved, the scope of protection we are able to establish and maintain for intellectual

property rights covering our technology platform, our ability to obtain future financing, market and other conditions and those identified

in our Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q under the caption "Risk Factors" and in other

filings the Company periodically makes with the SEC. Readers are urged to review these risk factors and to not act in reliance on any

forward-looking statements, as actual results may differ from those contemplated by our forward-looking statements. Phio does not undertake

to update forward-looking statements to reflect a change in its views, events or circumstances that occur after the date of this release,

except as required by law.

Phio Pharmaceuticals Corp.

PHIO PHARMACEUTICALS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except share and per

PHIO PHARMACEUTICALS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share data)