What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2023-11-15 compared with 2023-08-14 · 1608 added, 1598 removed, 173 unchanged (95% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Caution Regarding Forward-Looking Information

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Caution Regarding

Forward-Looking Information

The following information should be read in conjunction

with ABVC BioPharma, Inc.

and its subsidiaries (“we”, “us”, “our”, or the “Company”) condensed

unaudited financial statements and the notes thereto contained elsewhere in this report.

Information in this Item 2, “Management’s

Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this Form 10-Q that does not consist

of historical facts, are “forward-looking statements.” Statements accompanied or qualified by, or containing words such as

“may,” “will,” “should,” “believes,” “expects,” “intends,” “plans,”

“projects,” “estimates,” “predicts,” “potential,” “outlook,” “forecast,”

“anticipates,” “presume,” and “assume” constitute forward-looking statements, and as such, are not

a guarantee of future performance.

Forward-looking statements are subject to risks

and uncertainties, certain of which are beyond our control.

Actual results could differ materially from those anticipated as a result

of the factors described in the “Risk Factors” and detailed in our other Securities and Exchange Commission (“SEC”)

Risks and uncertainties can include, among others, international, national and local general economic and market conditions:

FORWARD-LOOKING

following information should be read in conjunction with ABVC BioPharma, Inc.

and its subsidiaries (“we”, “us”,

“our”, or the “Company”) condensed unaudited financial statements and the notes thereto contained elsewhere in

Information in this Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,”

and elsewhere in this Form 10-Q that does not consist of historical facts, are “forward-looking statements.” Statements accompanied

or qualified by, or containing words such as “may,” “will,” “should,” “believes,” “expects,”

“intends,” “plans,” “projects,” “estimates,” “predicts,” “potential,”

“outlook,” “forecast,” “anticipates,” “presume,” and “assume” constitute

forward-looking statements, and as such, are not a guarantee of future performance.

Forward-looking

statements are subject to risks and uncertainties, certain of which are beyond our control.

Actual results could differ materially from

those anticipated as a result of the factors described in the “Risk Factors” and detailed in our other Securities and Exchange

Commission (“SEC”) filings.

Risks and uncertainties can include, among others, international, national and local general

economic and market conditions:

demographic changes;

the ability of the Company to sustain, manage or forecast its growth;

the ability of the Company to successfully

make and integrate acquisitions;

of the Company to successfully make and integrate acquisitions;

raw material costs and availability;

new product development and introduction;

existing government regulations

and changes in, or the failure to comply with, government regulations;

existing government regulations and changes in, or the failure to comply with, government regulations;

adverse publicity;

the loss of significant customers

or suppliers;

the loss of significant customers or suppliers;

fluctuations and difficulty in forecasting operating results;

changes in business strategy or development plans;

changes in business strategy

or development plans;

business disruptions;

the ability to attract and retain qualified personnel;

the ability to obtain sufficient financing to continue and expand

business operations;

the ability to obtain sufficient financing

to continue and expand business operations;

the ability to develop technology and products;

changes in technology and the development of technology and intellectual

property by competitors;

changes in technology and the development

of technology and intellectual property by competitors;

the ability to protect technology and develop intellectual property;

and other factors referenced in this and

previous filings.

Consequently, investors should not place undue reliance on forward-looking statements as predictive of future results.

Because of these risks and uncertainties, the

forward-looking events and circumstances discussed in this report or incorporated by reference might not transpire.

Factors that cause

actual results or conditions to differ from those anticipated by these and other forward-looking statements include those more fully described

elsewhere in this report and in the “Risk Factors” section of our annual report on form 10-K.

The Company disclaims any obligation to update

the forward-looking statements in this report.

ABVC BioPharma Inc., which was incorporated under

the laws of the State of Nevada on February 6, 2002, is a clinical stage biopharmaceutical company focused on development of new drugs

and medical devices, all of which are derived from plants.

Medicines derived from plants have a long history

of relieving or preventing many diseases and, typically, have exhibited fewer side effects than drugs developed from animals or chemical

Perhaps the most famous example is aspirin, which evolved from a compound found in the bark and leaves of the willow tree

and was later marketed by Bayer starting in 1899.

Aspirin has very few serious side effects and has proven to be one of the most successful

drugs in medical history.

Some 50 years later, scientists identified anticancer compounds in the rosy periwinkle, which Eli Lilly subsequently

produced for the treatment of leukemia and Hodgkins disease.

Other well-known examples of successful botanical drugs include the cancer-fighting

Taxol, isolated from the Pacific yew tree.

The Company develops its pipeline by carefully

tracking new medical discoveries or medical device technologies in research institutions in the Asia-Pacific region.

Pre-clinical, disease

animal model and Phase I safety studies are examined closely by the Company’s scientists and other specialists known to the Company

to identify drugs that it believes demonstrate efficacy and safety based on the Company’s internal qualifications.

Once a drug is

shown to be a good candidate for further development and ultimately commercialization, BriVision licenses the drug or medical device from

the original researchers and begins to introduce the drugs clinical plan to highly respected principal investigators in the United States,

Australia and Taiwan.

In almost all cases, we have found that research institutions in each of those countries are eager to work with

the Company to move forward with Phase II clinical trials.

Currently, institutions conducting phase II clinical trials in partnership

with ABVC include:

● Medical Device:

ABV-1701, Vitargus ® in vitrectomy surgery,

‌Phase II Study in Australia and Thailand, Principal Investigator:

factors referenced in this and previous filings.

Consequently, investors should not place undue reliance on forward-looking statements

as predictive of future results.

of these risks and uncertainties, the forward-looking events and circumstances discussed in this report or incorporated by reference

might not transpire.

Factors that cause actual results or conditions to differ from those anticipated by these and other forward-looking

statements include those more fully described elsewhere in this report and in the “Risk Factors” section of our annual report

on form 10-K.

Company disclaims any obligation to update the forward-looking statements in this report.

BioPharma Inc., which was incorporated under the laws of the State of Nevada on February 6, 2002, is a clinical stage biopharmaceutical

company focused on development of new drugs and medical devices, all of which are derived from plants.

derived from plants have a long history of relieving or preventing many diseases and, typically, have exhibited fewer side effects than

drugs developed from animals or chemical ingredients.

Perhaps the most famous example is aspirin, which evolved from a compound found

in the bark and leaves of the willow tree and was later marketed by Bayer starting in 1899.

Aspirin has very few serious side effects

and has proven to be one of the most successful drugs in medical history.

Some 50 years later, scientists identified anticancer compounds

in the rosy periwinkle, which Eli Lilly subsequently produced for the treatment of leukemia and Hodgkins disease.

Other well-known examples

of successful botanical drugs include the cancer-fighting Taxol, isolated from the Pacific yew tree.

Company develops its pipeline by carefully tracking new medical discoveries or medical device technologies in research institutions in

the Asia-Pacific region.

Pre-clinical, disease animal model and Phase I safety studies are examined closely by the Company’s scientists

and other specialists known to the Company to identify drugs that it believes demonstrate efficacy and safety based on the Company’s

internal qualifications.

Once a drug is shown to be a good candidate for further development and ultimately commercialization, BriVision

licenses the drug or medical device from the original researchers and begins to introduce the drugs clinical plan to highly respected

principal investigators in the United States, Australia and Taiwan.

In almost all cases, we have found that research institutions in

each of those countries are eager to work with the Company to move forward with Phase II clinical trials.

Currently, institutions

conducting phase II clinical trials in partnership with ABVC include:

ABV-1701, Vitargus ® in vitrectomy surgery, Phase II Study in Australia and Thailand, Principal Investigator:

Professor/Dr.

Matthew Simunovic, Sydney Eye Hospital;

Elvis Ojaimi, East Melbourne Eye Group & East Melbourne Retina, Duangnate Rojanaporn, M.D., ‌Ramathibodi Hospital Thailand;

Thuss Sanguansak, M.D., Srinagarind Hospital, Thailand 1 .

Elvis Ojaimi, East Melbourne Eye Group & East Melbourne Retina,

Duangnate Rojanaporn, M.D., Ramathibodi Hospital Thailand;

and Thuss Sanguansak, M.D., Srinagarind Hospital, Thailand 1 .

ABV-1505, Adult Attention-Deficit Hyperactivity Disorder (ADHD), Phase II, Part II, NCE drug Principal Investigators:

Keith McBurnett, Ph.D.

and Linda Pfiffner, Ph.D., University of California San Francisco (UCSF), School of Medicine and five (5) major hospitals in Taiwan.

Keith McBurnett,

and Linda Pfiffner, Ph.D., University of California San Francisco (UCSF), School of Medicine and five (5) major hospitals in

ABV-1601, Major Depression in Cancer Patients, Phase I/II, NCE drug Principal Investigator:

Scott Irwin, MD, Ph.D.

– Cedars Sinai Medical Center (CSMC)

Sinai Medical Center (CSMC)

ABV-1703, Advanced Inoperable or Metastatic Pancreatic Cancer, Phase II, NCE drug Principal Investigator:

Hendifar, MD – Cedars Sinai Medical Center (CSMC)

ABV-‌1519, A Phase I/II, Open Label Study to Evaluate the Safety and Efficacy of BLEX 404 Oral Liquid Combined with ‌Pemetrexed + Carboplatin Therapy in Patients with ‌Advanced Inoperable or Metastatic EGFR wild-type Non-Small Cell Lung Cancer Patients

Upon successful completion of the Phase II trial,

the Company will seek a partner – a large pharmaceutical company – to complete a Phase III study, submit the New Drug Application

(NDA), and commercialize the drug upon approval by the FDA and Taiwan FDAs.

The Company expects to seek its first commercialization partner

in 2023 for Vitargus, its vitreous substitute that helps to maintain a round shape and retinal location during vitrectomy surgery.

Another part of the Company’s business is

conducted by BioKey, a wholly-owned subsidiary, that is engaged in a wide range of services, including, API characterization, pre-formulation

studies, formulation development, analytical method development, stability studies, IND/NDA/ANDA/510K submissions, and manufacturing clinical

trial materials (phase I through phase III) and commercial manufacturing.

On February 8, 2019, the Company, BioLite Holding,

– Cedars Sinai Medical Center (CSMC)

ABV-1519, A Phase I/II, Open Label Study to Evaluate the Safety and Efficacy of BLEX 404 Oral Liquid Combined with Pemetrexed

+ Carboplatin Therapy in Patients with Advanced Inoperable or Metastatic EGFR wild-type Non-Small Cell Lung Cancer Patients

received the “STUDY MAY PROCEED” letter from FDA on December 30, 2023.

The study will be conducted in Taiwan.

The study is still waiting Taiwan FDA approval.

successful completion of the Phase II trial, the Company will seek a partner – a large pharmaceutical company – to complete

a Phase III study, submit the New Drug Application (NDA), and commercialize the drug upon approval by the FDA and Taiwan FDAs.

expects to seek its first commercialization partner in 2023 for Vitargus, its vitreous substitute that helps to maintain a round shape

and retinal location during vitrectomy surgery.

part of the Company’s business is conducted by BioKey, a wholly-owned subsidiary, that is engaged in a wide range of services,

including, API characterization, pre-formulation studies, formulation development, analytical method development, stability studies,

IND/NDA/ANDA/510K submissions, and manufacturing clinical trial materials (phase I through phase III) and commercial manufacturing.

February 8, 2019, the Company, BioLite Holding, Inc.

(“BioLite”), BioKey, Inc.

(“BioKey”), BioLite Acquisition Corp., a direct wholly-owned subsidiary of the

Company (“Merger Sub 1”), and BioKey Acquisition Corp., a direct wholly-owned subsidiary of the Company (“Merger Sub

2”) (collectively referred to as the “Parties”) completed the business combination pursuant to that certain Agreement

and Plan of Merger (the “Merger Agreement”), dated January 31, 2018, pursuant to which the Company acquired BioLite and BioKey

via issuing shares of the Company’s Common Stock to the shareholders of BioLite and BioKey.

As a result, BioLite and BioKey became

two wholly-owned subsidiaries of the Company on February 8, 2019.

The Company issued an aggregate of 104,558,777 shares of Common Stock

(prior to the reverse stock split in 2019 and 2023) to the shareholders of both BioLite and BioKey under a registration statement on Form

S-4 (file number 333-226285), which became effective by operation of law on or about February 5, 2019.

(“BioKey”), BioLite Acquisition

Corp., a direct wholly-owned subsidiary of the Company (“Merger Sub 1”), and BioKey Acquisition Corp., a direct wholly-owned

subsidiary of the Company (“Merger Sub 2”) (collectively referred to as the “Parties”) completed the business

combination pursuant to that certain Agreement and Plan of Merger (the “Merger Agreement”), dated January 31, 2018, pursuant

to which the Company acquired BioLite and BioKey via issuing shares of the Company’s Common Stock to the shareholders of BioLite

As a result, BioLite and BioKey became two wholly-owned subsidiaries of the Company on February 8, 2019.

The Company issued

an aggregate of 104,558,777 shares of Common Stock (prior to the reverse stock split in 2019 and 2023) to the shareholders of both BioLite

and BioKey under a registration statement on Form S-4 (file number 333-226285), which became effective by operation of law on or about

February 5, 2019.

July 25, 2023, the Company filed a Certificate of Amendment to its Articles of Incorporation authorizing a 1-for-10 reverse stock split

7 unchanged sentences

restore compliance with certain continued listing standards of NASDAQ Capital Market.

BioLite was incorporated under the laws of the

State of Nevada on July 27, 2016, with 500,000,000 shares authorized, par value $0.0001.

BioLite’s key subsidiaries include BioLite

(“BioLite BVI”), which was incorporated in the British Virgin Islands on September 13, 2016 and BioLite, Inc.

Taiwan”), a Taiwanese corporation that was founded in February 2006.

BioLite Taiwan has been in the business of developing new drugs

for over ten years.

BioLite and BioLite BVI are holding companies

and have not carried out substantive business operations of their own.

In January 2017, BioLite, BioLite BVI, BioLite

Taiwan, and certain shareholders of BioLite Taiwan entered into a share purchase / exchange agreement (the “BioLite Share Purchase

/ Exchange Agreement”).

Pursuant to the BioLite Share Purchase / Exchange Agreement, the shareholder participants to the BioLite

Share Purchase / Exchange Agreement sold their equity in BioLite Taiwan and used the proceeds from such sales to purchase shares of Common

Stock of BioLite at the same price per share, resulting in share ownership in BioLite Common Stock equal to the number of shares they

had held in BioLite Taiwan Common Stock.

Upon closing of the Share Purchase/ Exchange Agreement in August 2017, BioLite owned, via BioLite

BVI, approximately 73% of BioLite Taiwan.

The other shareholders who did not enter this Share Purchase/ Exchange Agreement retained their

equity ownership in BioLite Taiwan.

BioKey was incorporated on August 9, 2000 in the

State of California.

It is engaged primarily in research and development, manufacturing, and distribution of generic drugs and nutraceuticals

with strategic partners.

BioKey provides a wide range of services, including, API characterization, pre-formulation studies, formulation

development, analytical method development, stability studies, IND/NDA/ANDA/510K submissions, and manufacturing clinical trial materials

(phase 1 through phase 3) and commercial manufacturing.

It also licenses out its technologies and initiates joint research and development

processes with other biotechnology, pharmaceutical, and nutraceutical companies.

1 The Vitargus ® Phase II study was put on hold due to

Serious Adverse Events (SAEs) observed in patients with retinal detachment treated with either Vitargus or SF6 comparator after vitrectomy

surgeries at the Thailand sites.

By comparing the Thailand study with the First-in-Human (FIH) study completed in Australia in 2018, the

SAEs derived from the patients in the Thailand study may be due to the modified in-situ hydrogel procedure which allows

a longer surgical time window for the study.

The Company is investigating the root causes of the events and is working towards developing

a safe device in-situ procedure before reinstating the study.

As of June 21, 2023, Dr.

Howard Doong resigned as the Company’s

CEO and was replaced by Dr.

was incorporated under the laws of the State of Nevada on July 27, 2016, with 500,000,000 shares authorized, par value $0.0001.

key subsidiaries include BioLite BVI, Inc.

(“BioLite BVI”), which was incorporated in the British Virgin Islands on September

13, 2016 and BioLite, Inc.

(“BioLite Taiwan”), a Taiwanese corporation that was founded in February 2006.

BioLite Taiwan

has been in the business of developing new drugs for over ten years.

and BioLite BVI are holding companies and have not carried out substantive business operations of their own.

January 2017, BioLite, BioLite BVI, BioLite Taiwan, and certain shareholders of BioLite Taiwan entered into a share purchase / exchange

agreement (the “BioLite Share Purchase / Exchange Agreement”).

Pursuant to the BioLite Share Purchase / Exchange Agreement,

the shareholder participants to the BioLite Share Purchase / Exchange Agreement sold their equity in BioLite Taiwan and used the proceeds

from such sales to purchase shares of Common Stock of BioLite at the same price per share, resulting in share ownership in BioLite Common

Stock equal to the number of shares they had held in BioLite Taiwan Common Stock.

Upon closing of the Share Purchase/ Exchange Agreement

in August 2017, BioLite owned, via BioLite BVI, approximately 73% of BioLite Taiwan.

The other shareholders who did not enter this Share

Purchase/ Exchange Agreement retained their equity ownership in BioLite Taiwan.

was incorporated on August 9, 2000 in the State of California.

It is engaged primarily in research and development, manufacturing, and

distribution of generic drugs and nutraceuticals with strategic partners.

BioKey provides a wide range of services, including, API characterization,

pre-formulation studies, formulation development, analytical method development, stability studies, IND/NDA/ANDA/510K submissions, and

manufacturing clinical trial materials (phase 1 through phase 3) and commercial manufacturing.

It also licenses out its technologies

and initiates joint research and development processes with other biotechnology, pharmaceutical, and nutraceutical companies.

Vitargus ® Phase II study was put on hold due to Serious Adverse Events (SAEs) observed in patients with retinal detachment

treated with either Vitargus or SF6 comparator after vitrectomy surgeries at the Thailand sites.

By comparing the Thailand study

with the First-in-Human (FIH) study completed in Australia in 2018, the SAEs derived from the patients in the Thailand study may

be due to the modified in-situ hydrogel procedure which allows a longer surgical time window for the study.

Company is investigating the root causes of the events and is working towards developing a safe device in-situ procedure

before reinstating the study.

As of June 21, 2023,

Howard Doong resigned as the Company’s CEO and was replaced by Dr.

On August 14, 2023, the Company entered into a cooperation agreement

(the “ Agreement ”, the transaction contemplated therein the “ Transaction ”) with Zhonghui United Technology

(Chengdu) Group Co., Ltd., a Company established under the Law of People’s Republic of China (“ Zhonghui ”).

thereto, the Company acquired 20% of the ownership of a property and the parcel of the land (the “ Property ”) owned

by Zhonghui in Leshan, Sichuan, China.

The valuation of the Property as of April 18, 2023, which was assessed by an independent third

party, is estimated to be approximately CNY 264,299,400 or approximately US$37,000,000.

In exchange, the Company agreed to issue to Zhonghui,

an aggregate of 370,000 shares of the Company’s common stock, at a per share price of $20 (the “ Zhonghui Shares ”).

On September 4, 2023, the Company and Zhonghui entered into an amendment to the Agreement to clarify that, in no event will the Company

issue to Zhonghui shares of common stock, in connection with the Transaction, in an amount exceeding 19.99% of the issued and outstanding

shares as of the date of the Agreement.

The Company and Zhonghui

plan to jointly develop the Property into a healthcare center for senior living, long-term care, and medical care in the areas of ABVCs’

special interests, such as Ophthalmology, Oncology, and Central Nervous Systems.

The plan is to establish a base for the China market

and global development of these interests.

The asset ownership certification is in the application process and pending approval from the

Chinese government.

the third quarter of 2023, the Company issued the Zhonghui Shares.

The Zhonghui Shares are subject to a

lock-up period of one year following the closing date of this Transaction.

In addition, the parties agreed that, after one year

following the closing of the Transaction, the market value of the shares issued or the value of the Property increase or decrease,

the parties will negotiate in good faith to make reasonable adjustment.

July 31, 2023, the Company entered into a binding term sheet with Xinnovation Therapeutics Co., Ltd., a Company incorporated under the

Law of People’s Republic of China.

The term sheet contemplates that, pursuant to definitive agreements, Xinnovation will be granted

an exclusive license to develop, manufacture, market, and distribute ABV-1504 for Major Depressive Disorder (MDD) and ABV-1505 for Attention-Deficit/Hyperactivity

Disorder, in the Chinese market and shall bear the costs for clinical trials and product registration in China and the Company would

receive an initial license fee and royalty payments ranging from 5% to 12% based on the projected annual net sales of the licensed drugs

by Xinnovation in China.

This transaction remains subject to the negotiation of definitive documents and therefore there is no guarantee

that this transaction will occur.

In November 2023, the Company and one of its

subsidiaries, BioLite, Inc.

(“BioLite”) each entered into a multi-year, global licensing agreement with AIBL for the

Company and BioLite’s CNS drugs with the indications of MDD (Major Depressive Disorder) and ADHD (Attention Deficit

Hyperactivity Disorder) (the “Licensed Products”).

The potential license will cover the Licensed Products’

clinical trial, registration, manufacturing, supply, and distribution rights.

The Licensed Products for MDD and ADHD, owned by ABVC

and BioLite, were valued at $667M by a third-party evaluation.

The parties are determined to collaborate on the global development

of the Licensed Products.

The parties are also working to strengthen new drug development and business collaboration, including

technology, interoperability, and standards development.

As per each of the respective agreements, each of ABVC and BioLite shall

receive 23 million shares of AIBL stock at $10 per share, and if certain milestones are met, $3,500,000 and royalties equaling 5% of

net sales, up to $100 million.

Stock Reverse Split

On March 12, 2019, the Board, by unanimous written

consent in lieu of a meeting, approved to i) implement a stock reverse split at the ratio of 1-for-18 (the “Reverse Split”)

of both the authorized common stock of the Company and the issued and outstanding common stock and ii) to amend the articles of incorporation

of the Company to reflect the Reverse Split.

The Board approved and authorized the Reverse Split without obtaining approval of the Company’s

shareholders pursuant to Section 78.207 of Nevada Revised Statutes.

On May 3, 2019, the Company filed a certificate

of amendment to the Company’s articles of incorporation (the “Amendment”) to implement the Reverse Split with the Secretary

of State of the State of Nevada.

March 12, 2019, the Board, by unanimous written consent in lieu of a meeting, approved to i) implement a stock reverse split at the ratio

of 1-for-18 (the “Reverse Split”) of both the authorized common stock of the Company and the issued and outstanding common

stock and ii) to amend the articles of incorporation of the Company to reflect the Reverse Split.

The Board approved and authorized the

Reverse Split without obtaining approval of the Company’s shareholders pursuant to Section 78.207 of Nevada Revised Statutes.

May 3, 2019, the Company filed a certificate of amendment to the Company’s articles of incorporation (the “Amendment”)

to implement the Reverse Split with the Secretary of State of the State of Nevada.

The Reverse Split took effect on May 8, 2019.

On July 25, 2023, the Company filed a Certificate

of Amendment to its Articles of Incorporation authorizing a 1-for-10 reverse stock split of the issued and outstanding shares of its common

stock (the “2023 Split”).

The Company’s stockholders previously approved the Reverse Stock Split at the Company’s

Special Shareholder Meeting held on July 7, 2023.

The Reverse Stock Split was effected to reduce the number of issued and outstanding

shares and to increase the per share trading value of the Company’s common stock, although that outcome is not guaranteed.

the Company believes that the Reverse Stock Split will enable the Company to restore compliance with certain continued listing standards

of NASDAQ Capital Market.

On July 14, 2023, the Company filed a certificate

of amendment to the Company’s articles of incorporation (the “Amendment”) to implement the 2023 Split with the Secretary

of State of the State of Nevada.

July 25, 2023, the Company filed a Certificate of Amendment to its Articles of Incorporation authorizing a 1-for-10 reverse stock split

of the issued and outstanding shares of its common stock (the “2023 Split”).

The Company’s stockholders previously

approved the Reverse Stock Split at the Company’s Special Shareholder Meeting held on July 7, 2023.

The Reverse Stock Split was

effected to reduce the number of issued and outstanding shares and to increase the per share trading value of the Company’s common

stock, although that outcome is not guaranteed.

In turn, the Company believes that the Reverse Stock Split will enable the Company to

restore compliance with certain continued listing standards of NASDAQ Capital Market.

July 14, 2023, the Company filed a certificate of amendment to the Company’s articles of incorporation (the “Amendment”)

to implement the 2023 Split with the Secretary of State of the State of Nevada.

The 2023 Split took effect on July 25, 2023.

Series A Convertible Preferred Stock

On June 28, 2019, the Company filed a certificate

of designation (the “Series A COD”) of Series A Convertible Preferred Stock (the “Series A Stock”) with the Secretary

of the State of Nevada.

Pursuant to the Series A COD, the Company designated

3,500,000 shares of preferred stock as Series A Stock, par value of $0.001 per share.

Subject to the laws of Nevada, the Company will

pay cumulative dividends on the Series A Stock on each anniversary from the date of original issue for a period of four calendar years.

The Series A Stock will rank senior to the outstanding common stock of the Company, par value $0.001 (the “Common Stock”)

with respect to dividend rights, rights upon liquidation, dissolution or winding up in the amount of accrued but unpaid dividend.

of the Series A Stock will have the same voting rights as the Company’s Common Stock holders.

Each share of Series A Stock is initially

convertible at any time at the option of the holder into one share of Common Stock and automatically converts into one share of Common

Stock on the four-year anniversary of its issuance.

A Convertible Preferred Stock

June 28, 2019, the Company filed a certificate of designation (the “Series A COD”) of Series A Convertible Preferred Stock

(the “Series A Stock”) with the Secretary of the State of Nevada.

to the Series A COD, the Company designated 3,500,000 shares of preferred stock as Series A Stock, par value of $0.001 per share.

to the laws of Nevada, the Company will pay cumulative dividends on the Series A Stock on each anniversary from the date of original

issue for a period of four calendar years.

The Series A Stock will rank senior to the outstanding common stock of the Company, par value

$0.001 (the “Common Stock”) with respect to dividend rights, rights upon liquidation, dissolution or winding up in the amount

of accrued but unpaid dividend.

Holders of the Series A Stock will have the same voting rights as the Company’s Common Stock holders.

Each share of Series A Stock is initially convertible at any time at the option of the holder into one share of Common Stock and automatically

converts into one share of Common Stock on the four-year anniversary of its issuance.

As of December 31, 2022, no Series A Convertible

1 unchanged sentence

NASDAQ Listing

On August 5, 2021, we closed a public offering

(the “Offering”) of 1,100,000 units (the “Units”), with each Unit consisting of one share of our common

stock (the “Common Stock”), one Series A warrant (the “Series A Warrants”) to purchase one share of common stock

at an exercise price equal to $6.30 per share, exercisable until the fifth anniversary of the issuance date, and one Series B warrant

(the “Series B Warrants,” and together with the Series A Warrants, the “Public Warrants”) to purchase one share

of common stock at an exercise price equal to $10.00 per share, exercisable until the fifth anniversary of the issuance date;

exercise price of the Public Warrants are subject to certain adjustment and cashless exercise provisions as described therein.

completed the Offering pursuant to its registration statement on Form S-1 (File No.

333-255112), originally filed with the Securities

and Exchange Commission (the “SEC”) on April 8, 2021 (as amended, the “Original Registration Statement”), that

the SEC declared effective on August 2, 2021 and the registration statement on Form S-1 (File No.

333-258404) that was filed and automatically

effective on August 4, 2021 (the “S-1MEF,” together with the Original Registration Statement, the “Registration Statement”).

The Units were priced at $6.25 per Unit, before underwriting discounts and offering expenses, resulting in gross proceeds of $6,875,000.

August 5, 2021, we closed a public offering (the “Offering”) of 1,100,000 units (the “Units”), with

each Unit consisting of one share of our common stock (the “Common Stock”), one Series A warrant (the “Series A Warrants”)

to purchase one share of common stock at an exercise price equal to $6.30 per share, exercisable until the fifth anniversary of

the issuance date, and one Series B warrant (the “Series B Warrants,” and together with the Series A Warrants, the “Public

Warrants”) to purchase one share of common stock at an exercise price equal to $10.00 per share, exercisable until the fifth

anniversary of the issuance date;

the exercise price of the Public Warrants are subject to certain adjustment and cashless exercise provisions

as described therein.

The Company completed the Offering pursuant to its registration statement on Form S-1 (File No.

333-255112), originally

filed with the Securities and Exchange Commission (the “SEC”) on April 8, 2021 (as amended, the “Original Registration

Statement”), that the SEC declared effective on August 2, 2021 and the registration statement on Form S-1 (File No.

that was filed and automatically effective on August 4, 2021 (the “S-1MEF,” together with the Original Registration Statement,

the “Registration Statement”).

The Units were priced at $6.25 per Unit, before underwriting discounts and offering expenses,

resulting in gross proceeds of $6,875,000.

The Offering was conducted on a firm commitment basis.

The Common Stock was approved for listing on The Nasdaq Capital Market and commenced

trading under the ticker symbol “ABVC” on August 3, 2021.

The Common Stock was approved for listing

on The Nasdaq Capital Market and commenced trading under the ticker symbol “ABVC” on August 3, 2021.

above-mentioned equity is before the reverse stock split in 2023.

15 unchanged sentences

with Rule 5550(a)(2).

The deficiency has no immediate effect on the

listing of the Company’s common stock, and its common stock continues to trade on The Nasdaq Capital Market under the symbol “ABVC”

at this time.

If at any time before August 14, 2023, the bid

price of the Company’s common stock closes at $1.00 per share or more for a minimum of 10 consecutive business days, the Staff will

provide written confirmation that the Company has achieved compliance and the matter will be closed.

If the Company does not regain compliance with

Rule 5550(a)(2) by August 14, 2023, the Staff will provide written notification that the Company’s securities will be delisted,

although the Company maintains the right to appeal such determination.

The Company intends to actively monitor the closing bid price for

its common stock and will consider available options to resolve the deficiency and regain compliance with Rule 5550(a)(2).

May 24, 2023, we received a deficiency letter from the Nasdaq Listing Qualifications Department (the “Staff”) of the Nasdaq

Stock Market LLC (“Nasdaq”) notifying the Company that it is not currently in compliance with the minimum stockholders’ equity

requirement, or the alternatives of market value of listed securities or net income from continuing operations, for continued listing

on the Nasdaq Capital Market.

Nasdaq Listing Rule 5550(b)(1) requires listed companies to maintain stockholders’ equity of at least

$2,500,000, and the Company’s stockholders’ equity was $1,734,507 as of March 31, 2023.

In accordance with Nasdaq rules, the

Company has 45 calendar days, or until July 10, 2023, to submit a plan to regain compliance.

After submitting a plan to regain compliance,

Nasdaq granted the Company an extension to comply with Listing Rule 5550(b)(1).

The Company must now achieve compliance with this rule

on or before August 31, 2023.

If the Company fails to evidence compliance upon filing its periodic report for the quarter ending September

30, 2023, the Company may be subject to delisting.

If Nasdaq determines to delist the Company’s securities, the Company will have

an opportunity to appeal Nasdaq’s decision.

Joint Venture Agreement

On October 6, 2021 (the “ Completion Date ”),

ABVC BioPharma, Inc.

(the “ Company ”), Lucidaim Co., Ltd., a Japanese corporation (“ Lucidaim ,” together

with the Company, the “ Shareholders ”), and BioLite Japan K.K., a Japanese corporation (“ Biolite JP” )

entered into a Joint Venture Agreement (the “ Agreement ”).

Biolite JP is a private limited company (a Japanese Kabushiki

Kaisha ) incorporated on December 18, 2018 and at the date of the Agreement had 10,000 ordinary shares authorized, with 3,049 ordinary

shares issued and outstanding (the “ Ordinary Shares ”).

Immediately prior to the execution of the Agreement, Lucidaim

owned 1,501 ordinary shares and the Company owned 1,548 ordinary shares.

The Shareholders entered into the joint venture to formally reduce

to writing their intention to invest in and operate Biolite JP as a joint venture.

The business of the joint venture shall be the research

and development of drugs, medical device and digital media, investment, fund raising and consulting, distribution and marketing of supplements

carried by Biolite JP and its subsidiaries in Japan, or any other territory or business, as the Agreement may with mutual consent be amended

from time to time.

The closing of the transaction was conditioned upon the approval and receipt of all necessary government approvals,

which have all been received.

Pursuant to the Agreement and the related share

transfer agreement, the Company shall transfer 54 of its Ordinary Shares to Lucidaim for no consideration, such that following the transfer,

Lucidaim shall own 1,555 Ordinary Shares (51%) and the Company shall own 1,494 Ordinary Shares (49%).

Also pursuant to the Agreement,

there shall be 3 directors of Biolite JP, consisting of 1 director appointed by the Company and 2 appointed by Lucidiam.

The Company shall

appoint Eugene Jiang, the Company’s current Chairman and Chief Business Officer and Lucidaim shall appoint Michihito Onishi;

current director of Biolite JP, Toru Seo (who is also a director of BioLite Japan’s other shareholder), is considered the second

Lucidaim director.

The Agreement further provides that the Company and Biolite JP shall assign the research collaboration and license

agreement between them to Biolite JP or prepare the same (the “ License Agreement ”).

The aforementioned transactions

occurred on the Completion Date.

As per the Agreement, the Shareholders shall supervise

and manage the business and operations of Biolite JP.

The directors shall not be entitled to any renumeration for their services as a

director and each Shareholder can remove and replace the director he/she/it appointed.

If a Shareholder sells or disposes of all of its

Ordinary Shares, the Shareholder-appointed director must tender his/her resignation.

The Agreement also sets forth certain corporate actions

that must be pre-approved by all Shareholders (the “ Reserved Matters ”).

If the Shareholders are unable to make a decision

on any Reserved Matter, then either Shareholder can submit a deadlock notice to the other shareholder, 5 days after which they must refer

the matter to each Shareholder’s chairman and use good faith to resolve the dispute.

If such dispute is not resolved within 10 days

thereafter, then either Shareholder can offer to buy all of the other Shareholder’s Ordinary Shares for cash at a specified price;

if there is not affirmative acceptance of the sale, the sale shall proceed as set forth in the sale offer.

Each of the Shareholders maintains a pre-emptive

right to purchase such number of additional Ordinary Shares as would allow such Shareholder to maintain its ownership percentage in Biolite

JP if Biolite JP issues any new Ordinary Shares.

However, the Agreement provides that the Company shall lose its pre-emptive rights under

certain conditions.

The Shareholders also maintain a right of first refusal if the other Shareholder receives an offer to buy such shareholder’s

Ordinary Shares.

The Agreement also requires Biolite JP to obtain

a bank facility in the amount of JPY 30,460,000 (approximately USD272,000), for its initial working capital purposes.

Pursuant to the

Agreement, each Shareholder agrees to guarantee such bank facility if the bank requires a guarantee.

Accordingly, the Company may be liable

for the bank facility in an amount up to JPY 14,925,400 (approximately USD134,000), which represents 49% of the maximum bank facility.

The Agreement further provides that Biolite JP shall issue annual dividends at the rate of at least 1.5% of Biolite JP’s profits,

if it has sufficient cash to do so.

Pursuant to the Agreement, the Company and Biolite

JP agree to use their best efforts to execute the License Agreement by the end of December 2021.

The Company agreed that any negotiation

on behalf of Biolite JP regarding the terms of the License Agreement shall be handled by the directors appointed by Lucidaim.

If the Company

and such Lucidaim directors do not reach agreement on the terms, Biolite JP may at its sole discretion determine not to execute the License

Agreement without any liability to the Company.

The Agreement contains non-solicitation and non-compete

clauses for a period of 2 years after a Shareholder or its subsidiaries ceases to be a Shareholder, with such restrictive covenants limited

to business within the ophthalmologic filed or central neurological field.

Any rights to intellectual property that arise from Biolite

JP’s activities, shall belong to Biolite JP.

The Agreement contains standard indemnification

terms, except that no indemnifying party shall have any liability for an individual liability unless it exceeds JPY 500,000 (approximately

USD4,500) and until the aggregate amount of all liabilities exceeds JPY 2,000,000 (approximately USD18,000) and then only to the extent

such liability exceed such limit.

The Company paid $150,000 towards the setup of

the joint venture and BioLite Japan’s other shareholder paid $150,000 after the Letter of Intent was signed.

The Agreement shall continue for 10 years, unless

earlier terminated and shall continue until terminated by:

(i) either party by giving the other party at least 6 months written notice,

until the end of the 10 years, after which the parties can terminate at any time or (ii) or by written agreement of all Shareholders,

in which case it shall terminate automatically on the date upon which all Ordinary Shares are owned by one Shareholder.

The Agreement

also allows a Shareholder to terminate the agreement upon certain defaults committed by another Shareholder, as set forth in the Agreement.

This was a related party transaction

and was conducted at arm’s length.

In addition to the Company’s board of directors providing approval for the Company to enter

into the Agreement, the Company’s audit committee approved the Company’s entry into the Agreement.

The Board believes that

this joint venture will enhance the Company’s ability to provide therapeutic solutions to significant unmet medical needs and to

develop innovative botanical drugs to treat central nervous system (“CNS”) and oncology/ hematology diseases.

The Company’s

Board of Directors believes that the joint venture has the potential to provide the Company with access to additional early-stage product

candidates that it would not otherwise have access to and to introduce the Company to early-stage opportunities, and therefore the Board

believes the joint venture is in the best interest of the Company and its shareholders.

Research Results

On October 20, 2022, the Company received a Notice

of Allowance for ABV-1504 from the US Patent and Trademark Office that extends the existing patent life of ABV-1504 from 2021 to the year

The patent, entitled “Polygala Extract for the Treatment of Major Depressive Disorder,” outlines a method for treating

major depressive disorder by oral administration of a composition, ABV-1504, containing Radix Polygalae (Polygala tenuifolia Willd).

polygala extract, designated PDC-1421, is the key active ingredient in ABV-1504 which was orally administered to healthy volunteers and

proved to be safe and well-tolerated for a daily dose from 380 mg to 3800 mg.

On September 9, 2020 the Company issued a full

clinical study report (CSR) of Vitargus ® First-in-Human Phase I Clinical Trial .

The safety and preliminary

efficacy findings from this study, combined with the unique properties of Vitargus ® (BFC-1401), are supportive of further

development for its use during vitrectomy surgery in patients requiring vitreous replacement.

The study was an open label, Phase I study undertaken

at a single study center in Sydney, Australia.

A total of 11 participants were enrolled for the study in which each participant had

been diagnosed with either (1) a complex or rhegmatogenous retinal detachment or chronic retinal detachment with failure of gas or silicone

oil treatment or (2) a vitreous hemorrhage that requires vitrectomy surgery.

The study found that Vitargus ® was well-tolerated

as a vitreous substitute without any apparent toxicity to ocular tissues.

Further, there was no indication of an increased overall safety

risk with Vitargus ® .

On August 2, 2022 the Company received the formal

approval from Central Research Ethics Committee (CREC) of The National Research Council of Thailand for Vitargus ® Phase

II Study Protocol (ABV-1701-02) to be conducted at Ramathibodi Hospital, Mahidol University and Srinagarind Hospital, Khon Kaen University

On November 2, 2022, both hospitals received Thai FDA investigational product (IP) import licenses allowing them to initiate

the clinical study in Thailand.

The Phase II clinical study entitled “A Prospective Multi-Site Randomized Controlled Clinical Investigation

of the Safety and Effectiveness of the ABV1701 Ocular Endotamponade (OE)” was initiated in Thailand in March 2023.

The Vitargus ® Phase II study was

put on hold due to Serious Adverse Events (SAEs) observed in patients with retinal detachment treated with either Vitargus or SF6 comparator

after vitrectomy surgeries at the Thailand sites.

By comparing the Thailand study with the First-in-Human (FIH) study completed in Australia

in 2018, the SAEs derived from the patients in the Thailand study may be due to the modified in-situ hydrogel procedure

which allows a longer surgical time window for the study.

The Company is investigating the root causes of the events and is working towards

developing a safe device in-situ procedure before reinstating the study.

In parallel, Vitargus ® Phase II

Study protocol documents were accepted by the Australian Bellberry Human Research Ethics Committee (HREC) and a Clinical Trial Notification

(“CTN”) was approved by the Australian Therapeutic Goods Administration (TGA) in February 2023.

The study approvals by the

research governance officers (RGO) of each participating sites, Sydney Eye Hospital and East Melbourne Eye Group are in progress.

On November 9, 2020 the Company issued a full

clinical study report (CSR) of its ABV-1505 Phase II Part I clinical trial conducted at the University of California, San Francisco (UCSF)

for the treatment of adult Attention-Deficit Hyperactivity Disorder (ADHD).

The Phase II Part I clinical study for treating

ADHD found that the PDC-1421 Capsule was safe, well tolerated and efficacious during its treatment and the follow-up period with six adult

For the primary endpoints, the percentages of improvement in Adult Attention-Deficit/Hyperactivity Disorder Rating Scale-Investigator

Rated-IV (ADHD-RS-IV) score from baseline to 8 weeks treatment were 83.3% (N=5) in the Intention-To-Treat (ITT) population and 80.0% (N=4)

in the Per-Protocol (PP) population.

Both low and high doses of PDC-1421 Capsule met the primary end points by passing the required 40%

population in ADHD-RS-IV test scores.

Overall, the results from this study, which demonstrate

the therapeutic value of PDC-1421, support further clinical development of ABV-1505 for the treatment of adult ADHD.

On July 12, 2022, the Company announced the enrollment progress in

the Phase II Part II clinical study of the company’s ADHD medicine (ABV-1505).

Since the first-treated subject reported on May 10,

2022, a total of fifty-seven (57) subjects have been enrolled in the study, including 48 who have completed the 56-day treatment.

study, a randomized, double-blind, placebo-controlled study entitled “A Phase II Tolerability and Efficacy Study of PDC-1421 Treatment

in Adult Patients with Attention-Deficit Hyperactivity Disorder (ADHD), Part II, is expected to eventually involve approximately 100 patients.

Five prestigious research hospitals in Taiwan and the research hospital at the University of California, San Francisco (UCSF) are participating

in the study which is a continuation of the Phase II part 1 study of ABV-1505 completed successfully at UCSF and accepted by the U.S.

deficiency has no immediate effect on the listing of the Company’s common stock, and its common stock continues to trade on The

Nasdaq Capital Market under the symbol “ABVC” at this time.

at any time before August 14, 2023, the bid price of the Company’s common stock closes at $1.00 per share or more for a minimum

of 10 consecutive business days, the Staff will provide written confirmation that the Company has achieved compliance and the matter

will be closed.

the Company does not regain compliance with Rule 5550(a)(2) by August 14, 2023, the Staff will provide written notification that the

Company’s securities will be delisted, although the Company maintains the right to appeal such determination.

The Company intends

to actively monitor the closing bid price for its common stock and will consider available options to resolve the deficiency and regain

compliance with Rule 5550(a)(2).

On May 24, 2023, we received a deficiency letter from the Nasdaq Listing

Qualifications Department (the “Staff”) of the Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that it

is not currently in compliance with the minimum stockholders’ equity requirement, or the alternatives of market value of listed

securities or net income from continuing operations, for continued listing on the Nasdaq Capital Market.

Nasdaq Listing Rule 5550(b)(1)

requires listed companies to maintain stockholders’ equity of at least $2,500,000, and the Company’s stockholders’ equity

was $1,734,507 as of March 31, 2023.

In accordance with Nasdaq rules, the Company has 45 calendar days, or until July 10, 2023, to submit

a plan to regain compliance.

After submitting a plan to regain compliance, Nasdaq granted the Company an extension to comply with Listing

Rule 5550(b)(1).

The Company must now achieve compliance with this rule on or before August 31, 2023.

If the Company fails to evidence

compliance upon filing its periodic report for the quarter ending September 30, 2023, the Company may be subject to delisting.

determines to delist the Company’s securities, the Company will have an opportunity to appeal Nasdaq’s decision.

on a series of transactions, we believe we regained compliance with the stockholders’ equity requirement as of August 31, 2023.

Nasdaq informed us that it will continue to monitor our ongoing compliance with the stockholders’ equity requirement,

and if we do not evidence compliance in this Quarterly Report, we may be subject to delisting.

As of September 30, 2023, our stockholders’

equity was $7,548,308, which exceeds Nasdaq’s minimum requirement.

Venture Agreement

October 6, 2021 (the “ Completion Date ”), ABVC BioPharma, Inc.

(the “ Company ”), Lucidaim Co., Ltd.,

a Japanese corporation (“ Lucidaim ,” together with the Company, the “ Shareholders ”), and BioLite

Japan K.K., a Japanese corporation (“ Biolite JP” ) entered into a Joint Venture Agreement (the “ Agreement ”).

Biolite JP is a private limited company (a Japanese Kabushiki Kaisha ) incorporated on December 18, 2018 and at the date of

the Agreement had 10,000 ordinary shares authorized, with 3,049 ordinary shares issued and outstanding (the “ Ordinary Shares ”).

Immediately prior to the execution of the Agreement, Lucidaim owned 1,501 ordinary shares and the Company owned 1,548 ordinary shares.

The Shareholders entered into the joint venture to formally reduce to writing their intention to invest in and operate Biolite JP as

a joint venture.

The business of the joint venture shall be the research and development of drugs, medical device and digital media,

investment, fund raising and consulting, distribution and marketing of supplements carried by Biolite JP and its subsidiaries in Japan,

or any other territory or business, as the Agreement may with mutual consent be amended from time to time.

The closing of the transaction

was conditioned upon the approval and receipt of all necessary government approvals, which have all been received.

to the Agreement and the related share transfer agreement, the Company shall transfer 54 of its Ordinary Shares to Lucidaim for no consideration,

such that following the transfer, Lucidaim shall own 1,555 Ordinary Shares (51%) and the Company shall own 1,494 Ordinary Shares (49%).

Also pursuant to the Agreement, there shall be 3 directors of Biolite JP, consisting of 1 director appointed by the Company and 2 appointed

The Company shall appoint Eugene Jiang, the Company’s current Chairman and Chief Business Officer and Lucidaim shall

appoint Michihito Onishi;

the current director of Biolite JP, Toru Seo (who is also a director of BioLite Japan’s other shareholder),

is considered the second Lucidaim director.

The Agreement further provides that the Company and Biolite JP shall assign the research

collaboration and license agreement between them to Biolite JP or prepare the same (the “ License Agreement ”).

aforementioned transactions occurred on the Completion Date.

per the Agreement, the Shareholders shall supervise and manage the business and operations of Biolite JP.

The directors shall not be

entitled to any renumeration for their services as a director and each Shareholder can remove and replace the director he/she/it appointed.

If a Shareholder sells or disposes of all of its Ordinary Shares, the Shareholder-appointed director must tender his/her resignation.

The Agreement also sets forth certain corporate actions that must be pre-approved by all Shareholders (the “ Reserved Matters ”).

If the Shareholders are unable to make a decision on any Reserved Matter, then either Shareholder can submit a deadlock notice to the

other shareholder, 5 days after which they must refer the matter to each Shareholder’s chairman and use good faith to resolve the

If such dispute is not resolved within 10 days thereafter, then either Shareholder can offer to buy all of the other Shareholder’s

Ordinary Shares for cash at a specified price;

if there is not affirmative acceptance of the sale, the sale shall proceed as set forth

in the sale offer.

of the Shareholders maintains a pre-emptive right to purchase such number of additional Ordinary Shares as would allow such Shareholder

to maintain its ownership percentage in Biolite JP if Biolite JP issues any new Ordinary Shares.

However, the Agreement provides that

the Company shall lose its pre-emptive rights under certain conditions.

The Shareholders also maintain a right of first refusal if the

other Shareholder receives an offer to buy such shareholder’s Ordinary Shares.

Agreement also requires Biolite JP to obtain a bank facility in the amount of JPY 30,460,000 (approximately USD272,000), for its initial

working capital purposes.

Pursuant to the Agreement, each Shareholder agrees to guarantee such bank facility if the bank requires a guarantee.

Accordingly, the Company may be liable for the bank facility in an amount up to JPY 14,925,400 (approximately USD134,000), which represents

49% of the maximum bank facility.

The Agreement further provides that Biolite JP shall issue annual dividends at the rate of at least

1.5% of Biolite JP’s profits, if it has sufficient cash to do so.

to the Agreement, the Company and Biolite JP agree to use their best efforts to execute the License Agreement by the end of December

The Company agreed that any negotiation on behalf of Biolite JP regarding the terms of the License Agreement shall be handled by

the directors appointed by Lucidaim.

If the Company and such Lucidaim directors do not reach agreement on the terms, Biolite JP may at

its sole discretion determine not to execute the License Agreement without any liability to the Company.

Agreement contains non-solicitation and non-compete clauses for a period of 2 years after a Shareholder or its subsidiaries ceases to

be a Shareholder, with such restrictive covenants limited to business within the ophthalmologic filed or central neurological field.

Any rights to intellectual property that arise from Biolite JP’s activities, shall belong to Biolite JP.

Agreement contains standard indemnification terms, except that no indemnifying party shall have any liability for an individual liability

unless it exceeds JPY 500,000 (approximately USD4,500) and until the aggregate amount of all liabilities exceeds JPY 2,000,000 (approximately

USD18,000) and then only to the extent such liability exceed such limit.

Company paid $150,000 towards the setup of the joint venture and BioLite Japan’s other shareholder paid $150,000 after the Letter

of Intent was signed.

Agreement shall continue for 10 years, unless earlier terminated and shall continue until terminated by:

(i) either party by giving the

other party at least 6 months written notice, until the end of the 10 years, after which the parties can terminate at any time or (ii)

or by written agreement of all Shareholders, in which case it shall terminate automatically on the date upon which all Ordinary Shares

are owned by one Shareholder.

The Agreement also allows a Shareholder to terminate the agreement upon certain defaults committed by another

Shareholder, as set forth in the Agreement.

was a related party transaction and was conducted at arm’s length.

In addition to the Company’s

board of directors providing approval for the Company to enter into the Agreement, the Company’s audit committee approved the Company’s

entry into the Agreement.

The Board believes that this joint venture will enhance the Company’s ability to provide therapeutic

solutions to significant unmet medical needs and to develop innovative botanical drugs to treat central nervous system (“CNS”)

and oncology/ hematology diseases.

The Company’s Board of Directors believes that the joint venture has the potential to provide

the Company with access to additional early-stage product candidates that it would not otherwise have access to and to introduce the

Company to early-stage opportunities, and therefore the Board believes the joint venture is in the best interest of the Company and its

shareholders.

Recent Research Results

October 20, 2022, the Company received a Notice of Allowance for ABV-1504 from the US Patent and Trademark Office that extends the existing

patent life of ABV-1504 from 2021 to the year 2041.

The patent, entitled “Polygala Extract for the Treatment of Major Depressive

Disorder,” outlines a method for treating major depressive disorder by oral administration of a composition, ABV-1504, containing

Radix Polygalae (Polygala tenuifolia Willd).

The polygala extract, designated PDC-1421, is the key active ingredient in ABV-1504 which

was orally administered to healthy volunteers and proved to be safe and well-tolerated for a daily dose from 380 mg to 3800 mg.

September 9, 2020 the Company issued a full clinical study report (CSR) of Vitargus ® First-in-Human Phase I Clinical Trial .

safety and preliminary efficacy findings from this study, combined with the unique properties of Vitargus ® (BFC-1401),

are supportive of further development for its use during vitrectomy surgery in patients requiring vitreous replacement.

study was an open label, Phase I study undertaken at a single study center in Sydney, Australia.

A total of 11 participants were

enrolled for the study in which each participant had been diagnosed with either (1) a complex or rhegmatogenous retinal detachment or

chronic retinal detachment with failure of gas or silicone oil treatment or (2) a vitreous hemorrhage that requires vitrectomy surgery.

The study found that Vitargus ® was well-tolerated as a vitreous substitute without any apparent toxicity to ocular tissues.

Further, there was no indication of an increased overall safety risk with Vitargus ® .

August 2, 2022 the Company received the formal approval from Central Research Ethics Committee (CREC) of The National Research Council

of Thailand for Vitargus ® Phase II Study Protocol (ABV-1701-02) to be conducted at Ramathibodi Hospital, Mahidol University

and Srinagarind Hospital, Khon Kaen University of Thailand.

On November 2, 2022, both hospitals received Thai FDA investigational product

(IP) import licenses allowing them to initiate the clinical study in Thailand.

The Phase II clinical study entitled “A Prospective

Multi-Site Randomized Controlled Clinical Investigation of the Safety and Effectiveness of the ABV1701 Ocular Endotamponade (OE)”

was initiated in Thailand in March 2023.

Vitargus ® Phase II study was put on hold due to Serious Adverse Events (SAEs) observed in patients with retinal detachment

treated with either Vitargus or SF6 comparator after vitrectomy surgeries at the Thailand sites.

By comparing the Thailand study with

the First-in-Human (FIH) study completed in Australia in 2018, the SAEs derived from the patients in the Thailand study may be due to

the modified in-situ hydrogel procedure which allows a longer surgical time window for the study.

The Company is investigating

the root causes of the events and is working towards developing a safe device in-situ procedure before reinstating the

parallel, Vitargus ® Phase II Study protocol documents were accepted by the Australian Bellberry Human Research Ethics Committee

(HREC) and a Clinical Trial Notification (“CTN”) was approved by the Australian Therapeutic Goods Administration (TGA) in

February 2023.

The study approvals by the research governance officers (RGO) of each participating sites, Sydney Eye Hospital and East

Melbourne Eye Group are in progress.

November 9, 2020 the Company issued a full clinical study report (CSR) of its ABV-1505 Phase II Part I clinical trial conducted at the

University of California, San Francisco (UCSF) for the treatment of adult Attention-Deficit Hyperactivity Disorder (ADHD).

Phase II Part I clinical study for treating ADHD found that the PDC-1421 Capsule was safe, well tolerated and efficacious during its

treatment and the follow-up period with six adult patients.

For the primary endpoints, the percentages of improvement in Adult Attention-Deficit/Hyperactivity

Disorder Rating Scale-Investigator Rated-IV (ADHD-RS-IV) score from baseline to 8 weeks treatment were 83.3% (N=5) in the Intention-To-Treat

(ITT) population and 80.0% (N=4) in the Per-Protocol (PP) population.

Both low and high doses of PDC-1421 Capsule met the primary end

points by passing the required 40% population in ADHD-RS-IV test scores.

the results from this study, which demonstrate the therapeutic value of PDC-1421, support further clinical development of ABV-1505 for

the treatment of adult ADHD.

July 12, 2022, the Company announced the enrollment progress in the Phase II Part II clinical study of the company’s ADHD medicine

Since the first-treated subject reported on May 10, 2022, a total of sixty-nine (69) subjects have been enrolled in the study,

including 50 who have completed the 56-day treatment.

The study, a randomized, double-blind, placebo-controlled study entitled “A

Phase II Tolerability and Efficacy Study of PDC-1421 Treatment in Adult Patients with Attention-Deficit Hyperactivity Disorder (ADHD),

Part II, is expected to eventually involve approximately 100 patients.

Five prestigious research hospitals in Taiwan and the research

hospital at the University of California, San Francisco (UCSF) are participating in the study which is a continuation of the Phase II

part 1 study of ABV-1505 completed successfully at UCSF and accepted by the U.S.

Food & Drug Administration in October of 2020.

The UCSF Medical Center Institutional Review Board has approved participation in the

Part II study, and the site initiation vist was conducted in March 2023.

The Cedars-Sinai Medical Center (CSMC, West Hollywood

CA) Institutional Review Board (IRB) has approved their institution joining the Phase I study of ABV-1601 for treating depression in cancer

UCSF Medical Center Institutional Review Board has approved participation in the Part II study, and the site initiation visit was conducted

in March 2023.

Cedars-Sinai Medical Center (CSMC, West Hollywood CA) Institutional Review Board (IRB) has approved their institution joining the Phase

I study of ABV-1601 for treating depression in cancer patients.

The Principal Investigator of the CSMC study will be Dr.

Irwin, MD, PhD., an eminent Professor of Psychiatry &

Behavioral Neurosciences.

The Phase I study is open label and will be conducted with 12 cancer patients with moderate to severe depressive

The main objective of the study is to evaluate the safety of PDC-1421, the primary active ingredient in ABV-1601.

objective is to determine the most effective dosages for a randomized, double-blind, non-inferiority Phase II trial of PDC-1421 comparing

with Wellbutrin XL, a commonly used medicine to treat cancer patients suffering with depression.

The site initiation visit of the Phase

I study was conducted in March 2023.

Public Offering & Financings

On February 23, 2023, the Company entered into

a securities purchase agreement (the “Lind Securities Purchase Agreement”) with Lind Global Fund II, LP (“Lind”),

pursuant to which the Company issued Lind a secured, convertible note in the principal amount of $3,704,167 (the “Lind Offering”),

for a purchase price of $3,175,000 (the “Lind Note”), that is convertible into shares of the Company’s common stock

at an initial conversion price of $1.05 per share, subject to adjustment (the “Note Shares”).

The Company also issued Lind

a common stock purchase warrant (the “Lind Warrant”) to purchase up to 5,291,667 shares of the Company’s common stock

at an initial exercise price of $1.05 per share, subject to adjustment (each, a “Warrant Share,” together with the Note, Note

Shares and Warrants, the “Lind Securities”).

The Lind Note does not carry any interest.

with the date that is six months from the issuance date of the Lind Note and on each one (1) month anniversary thereafter, the Company

shall pay Lind an amount equal to $308,650.58, until the outstanding principal amount of the Lind Note has been paid in full prior to

or on the Maturity Date or, if earlier, upon acceleration, conversion or redemption of the Lind Note in accordance with the terms thereof

(the “Monthly Payments”).

At the Company’s discretion, the Monthly Payments shall be made in (i) cash, (ii) shares of

the Company’s common stock, or (iii) a combination of cash and Shares;

if made in shares, the number of shares shall be determined

by dividing (x) the principal amount being paid in shares by (y) 90% of the average of the 5 lowest daily VWAPs during the 20 trading

days prior to the applicable payment date.

The Lind Notes sets forth certain conditions that must be satisfied before the Company may

make any Monthly Payments in shares of common stock.

If the Company makes a Monthly Payment in cash, the Company must also pay Lind a

cash premium of 5% of such Monthly Payment.

MD, PhD., an eminent Professor of Psychiatry & Behavioral Neurosciences.

The Phase I study is open label and will be conducted with

12 cancer patients with moderate to severe depressive symptoms.

The main objective of the study is to evaluate the safety of PDC-1421,

the primary active ingredient in ABV-1601.

The second objective is to determine the most effective dosages for a randomized, double-blind,

non-inferiority Phase II trial of PDC-1421 comparing with Wellbutrin XL, a commonly used medicine to treat cancer patients suffering

with depression.

The site initiation visit of the Phase I study was conducted in March 2023.

Public Offering

February 23, 2023, the Company entered into a securities purchase agreement (the “Lind Securities Purchase Agreement”) with

Lind Global Fund II, LP (“Lind”), pursuant to which the Company issued Lind a secured, convertible note in the principal

amount of $3,704,167 (the “Lind Offering”), for a purchase price of $3,175,000 (the “Lind Note”), that is convertible

into shares of the Company’s common stock at an initial conversion price of $1.05 per share, subject to adjustment (the “Note

The Company also issued Lind a common stock purchase warrant (the “Lind Warrant”) to purchase up to 5,291,667

shares of the Company’s common stock at an initial exercise price of $1.05 per share, subject to adjustment (each, a “Warrant

Share,” together with the Note, Note Shares and Warrants, the “Lind Securities”).

Lind Note does not carry any interest.

Beginning with the date that is six months from the issuance date of the Lind Note and on each

one (1) month anniversary thereafter, the Company shall pay Lind an amount equal to $308,650.58, until the outstanding principal amount

of the Lind Note has been paid in full prior to or on the Maturity Date or, if earlier, upon acceleration, conversion or redemption of

the Lind Note in accordance with the terms thereof (the “Monthly Payments”).

At the Company’s discretion, the Monthly

Payments shall be made in (i) cash, (ii) shares of the Company’s common stock, or (iii) a combination of cash and Shares;

in shares, the number of shares shall be determined by dividing (x) the principal amount being paid in shares by (y) 90% of the average

of the 5 lowest daily VWAPs during the 20 trading days prior to the applicable payment date.

The Lind Notes sets forth certain conditions

that must be satisfied before the Company may make any Monthly Payments in shares of common stock.

If the Company makes a Monthly Payment

in cash, the Company must also pay Lind a cash premium of 5% of such Monthly Payment.

Upon the occurrence of any Event of Default (as

defined in the Lind Note), the Company must pay Lind an amount equal to 120% of the then outstanding principal amount of the Lind Note

in addition to any other remedies under the Note or the other Transaction Documents.

The Lind Warrant may be exercised via cashless

Pursuant to the terms of the Lind Securities Purchase

Agreement, if at any time prior to a date that is 18 months following the closing of the Lind Offering, the Company proposes to offer

or sell any additional securities in a subsequent financing, the Company shall first offer Lind the opportunity to purchase up to 10%

of such new securities.

In connection with the Lind Offering, the Company

and its subsidiaries:

(i) BioKey, Inc., a California corporation (“BioKey”), (ii) Biolite Holding, Inc., a Nevada corporation

(“BioLite”), (iii) Biolite BVI, Inc., a British Virgin Islands corporation (“BioLite BVI”) and (iv) American BriVision

Corporation, a Delaware corporation (“American BriVision” and, collectively with the Company, BioKey, BioLite, and BioLite

BVI, the “Guarantors”), jointly and severally guaranteed all of the obligations of the Company in connection with the Lind

Offering (the “Guaranty”) with certain collateral, as set forth in the related Transaction Documents (as hereinafter defined).

The sale of the Lind Note and the terms of the

Lind Offering, including the Guaranty are set forth in the Lind Securities Purchase Agreement, the Note, the Warrant, a Security Agreement,

Guarantor Security, Guaranty, a Trademark Security Agreement with Rgene Corporation, a Trademark Security Agreement with BioFirst, a Patent

Security Agreement, a Copyright Security Agreement and a Stock Pledge Agreement (collectively, the “Transaction Documents”).

Allele Capital Partners, LLC (“Allele”)

together with its executing broker dealer, Wilmington Capital Securities, LLC (together with its affiliates, “Wilmington”),

served as the exclusive placement agent (the “Placement Agent”) of the Lind Offering.

As a result of the Lind Offering, the

Company will pay the Placement Agent (i) a cash fee of 6% of the gross proceeds from the sale of the Securities, and (ii) common stock

purchase warrants to purchase 6% of the number of shares of common stock issuable under the Lind Note.

We also agreed to pay certain expenses

of the placement agent in connection with the Lind Offering.

Pursuant to the Lind Securities Purchase Agreement,

the Company agreed to register all of the Lind Securities and the shares of common stock underlying the warrant issued to the placement

The Securities Purchase Agreement also contains

customary representation and warranties of the Company and the Investors, indemnification obligations of the Company, termination provisions,

and other obligations and rights of the parties.

The foregoing description of the Transaction Documents

is qualified by reference to the full text of the forms of the Transaction Documents, which are filed as Exhibits hereto and incorporated

herein by reference.

On August 1, 2023, Lind converted $500,000 convertible

notes into 142,857 shares of Common Stock, at a conversion price of $3.50 per share.

On July 27, 2023, the Company entered into that

certain securities purchase agreement.

relating to the offer and sale of 300,000 shares of common stock, par value $0.001 per share and

200,000 pre-funded warrants, at an exercise price of $0.001 per share, in a registered direct offering.

Pursuant to the Purchase Agreement,

the Company agreed to sell the Shares and/or Pre-funded Warrants at a per share purchase price of $3.50, for gross proceeds of $1,750,000,

before deducting any estimated offering expenses.

On August 1, 2023, the pre-funded warrants were exercised.

The transaction contemplated by the SPA was closed

on July 31, 2023, as all the closing conditions have been satisfied.

The Company paid to the placement agents an aggregate

cash fee equal to 6% of the aggregate sales price of the securities sold and warrants to purchase up to 30,000 shares of Common Stock,

on the same terms as the Pre-Funded Warrants.

(the “Mandatory Default Amount”), in addition to any other remedies under the Note or the other Transaction Documents.

Company and Lind entered into a letter agreement on September 12, 2023, pursuant to which the Mandatory Default Amount was reduced to

115% of the then outstanding principal amount of the Lind Note;

pursuant to the letter agreement, Lind also agreed to waive any default

associated with the Company’s market capitalization being below $12.5 million for 10 consecutive days through February 23, 2024,

but retained its right to convert its Note.

In addition, if the Company is unable to increase its market capitalization and is unable

to obtain a further waiver or amendment to the Lind Note, then the Company could experience an event of default under the Lind Note, which

could have a material adverse effect on the Company’s liquidity, financial condition, and results of operations.

The Company cannot

make any assurances regarding the likelihood, certainty, or exact timing of the Company’s ability to increase its market capitalization,

as such metric is not within the immediate control of the Company and depends on a variety of factors outside the Company’s control.

Lind Warrant may be exercised via cashless exercise.

to the terms of the Lind Securities Purchase Agreement, if at any time prior to a date that is 18 months following the closing of the

Lind Offering, the Company proposes to offer or sell any additional securities in a subsequent financing, the Company shall first offer

Lind the opportunity to purchase up to 10% of such new securities.

connection with the Lind Offering, the Company and its subsidiaries:

(i) BioKey, Inc., a California corporation (“BioKey”),

(ii) Biolite Holding, Inc., a Nevada corporation (“BioLite”), (iii) Biolite BVI, Inc., a British Virgin Islands corporation

(“BioLite BVI”) and (iv) American BriVision Corporation, a Delaware corporation (“American BriVision” and, collectively

with the Company, BioKey, BioLite, and BioLite BVI, the “Guarantors”), jointly and severally guaranteed all of the obligations

of the Company in connection with the Lind Offering (the “Guaranty”) with certain collateral, as set forth in the related

Transaction Documents (as hereinafter defined).

sale of the Lind Note and the terms of the Lind Offering, including the Guaranty are set forth in the Lind Securities Purchase Agreement,

the Note, the Warrant, a Security Agreement, Guarantor Security, Guaranty, a Trademark Security Agreement with Rgene Corporation, a Trademark

Security Agreement with BioFirst, a Patent Security Agreement, a Copyright Security Agreement and a Stock Pledge Agreement (collectively,

the “Transaction Documents”).

Capital Partners, LLC (“Allele”) together with its executing broker dealer, Wilmington Capital Securities, LLC (together

with its affiliates, “Wilmington”), served as the exclusive placement agent (the “Placement Agent”) of the Lind

As a result of the Lind Offering, the Company will pay the Placement Agent (i) a cash fee of 6% of the gross proceeds from

the sale of the Securities, and (ii) common stock purchase warrants to purchase 6% of the number of shares of common stock issuable under

the Lind Note.

We also agreed to pay certain expenses of the placement agent in connection with the Lind Offering.

to the Lind Securities Purchase Agreement, the Company agreed to register all of the Lind Securities and the shares of common stock underlying

the warrant issued to the placement agent.

Securities Purchase Agreement also contains customary representation and warranties of the Company and the Investors, indemnification

obligations of the Company, termination provisions, and other obligations and rights of the parties.

September 12, 2023, the Company and Lind entered into a letter agreement (the “Letter Agreement”) pursuant to which Lind

agreed to waive any default, any Event of Default, and any Mandatory Default Amount (each as defined in the Note) associated with the

Company’s market capitalization being below $12.5 million for 10 consecutive days through February 23, 2024.

Notwithstanding the

waiver, Lind retains its right to exercise conversion rights under 2.2(a), 2.2(c)(2)(x) and 3.1 of the Note, which could result

in a substantial amount of common stock issued at a significant discount to the trading price of the Company’s common stock.

addition, if the Company is unable to increase its market capitalization and is unable to obtain a further waiver or amendment to

the Note, then the Company could experience an event of default under the Note, which could have a material adverse effect on the Company’s

liquidity, financial condition, and results of operations.

The Company cannot make any assurances regarding the likelihood, certainty,

or exact timing of the Company’s ability to increase its market capitalization, as such metric is not within the immediate control

of the Company and depends on a variety of factors outside the Company’s control.

foregoing description of the Transaction Documents is qualified by reference to the full text of the forms of the Transaction Documents,

which are filed as Exhibits hereto and incorporated herein by reference.

August 1, 2023, Lind converted $500,000 convertible notes into 142,857 shares of Common Stock, at a conversion price of $3.50 per share.

July 27, 2023, the Company entered into that certain securities purchase agreement.

relating to the offer and sale of 300,000 shares

of common stock, par value $0.001 per share and 200,000 pre-funded warrants, at an exercise price of $0.001 per share, in a registered

direct offering.

Pursuant to the Purchase Agreement, the Company agreed to sell the Shares and/or Pre-funded Warrants at a per share

purchase price of $3.50, for gross proceeds of $1,750,000, before deducting any estimated offering expenses.

On August 1, 2023, the pre-funded

warrants were exercised.

transaction contemplated by the SPA was closed on July 31, 2023, as all the closing conditions have been satisfied.

Company paid to the placement agents an aggregate cash fee equal to 6% of the aggregate sales price of the securities sold and warrants

to purchase up to 30,000 shares of Common Stock, on the same terms as the Pre-Funded Warrants.

above-mentioned equity is before the reverse stock split in 2023.

Financing in May 2022

On May 11, 2022, the Company and an institutional

investor entered into certain securities purchase agreement relating to the offer and sale of 2,000,000 shares of common stock, par value

$0.001 per share in a registered direct offering.

Pursuant to the Offering, the Company also issued 5-year warrants to purchase 2,000,000

shares of Common Stock, exercisable at a price of $2.45 per share to the Purchasers.

The sale and offering of the shares and the warrants

pursuant to such securities purchase agreement was implemented as a takedown off the Company’s shelf registration statement on Form

S-3, as amended (File No.

May 11, 2022, the Company and an institutional investor entered into certain securities purchase agreement relating to the offer and

sale of 2,000,000 shares of common stock, par value $0.001 per share in a registered direct offering.

Pursuant to the Offering, the Company

also issued 5-year warrants to purchase 2,000,000 shares of Common Stock, exercisable at a price of $2.45 per share to the Purchasers.

The sale and offering of the shares and the warrants pursuant to such securities purchase agreement was implemented as a takedown off

the Company’s shelf registration statement on Form S-3, as amended (File No.

333-260588), which became effective on November 29,

WallachBeth Capital LLC and ViewTrade Securities,

acted as co-placement agents for the aforementioned offering of the shares and warrants.

The Company paid to the co-placement agents

an aggregate cash fee equal to 8% of the aggregate sales price of the securities sold and issued them warrants to purchase up to 160,000

shares of Common Stock, on the same terms as the warrants issued to the institutional investor.

WallachBeth Capital LLC and ViewTrade Securities, Inc.

acted as co-placement agents for the aforementioned offering of the shares

and warrants.

The Company paid to the co-placement agents an aggregate cash fee equal to 8% of the aggregate sales price of the securities

sold and issued them warrants to purchase up to 160,000 shares of Common Stock, on the same terms as the warrants issued to the institutional

above-mentioned equity is before the reverse stock split in 2023.

Key elements of our business strategy include:

● Advancing to the pivotal trial phase of ABV-1701 Vitargus ®

for the treatments of Retinal Detachment or Vitreous Hemorrhage, which we expect to generate revenues in the future.

elements of our business strategy include:

to the pivotal trial phase of ABV-1701 Vitargus ® for the treatments of Retinal Detachment or Vitreous Hemorrhage,

which we expect to generate revenues in the future.

on licensing ABV-1504 for the treatment of major depressive disorder, MDD.

2 unchanged sentences

as applicable, and further marketing if approved by the FDA.

We plan to augment our core research and development

capability and assets by conducting Phase I and II clinical trials for investigational new drugs and medical devices in the fields of

CNS, Hematology/Oncology and Ophthalmology.

Our management team has extensive experiences

across a wide range of new drug and medical device development, and we have in-licensed new drug and medical device candidates from large

research institutes and universities in both the U.S.

Through an assertive product development approach, we expect that we

will build a substantial portfolio of Oncology/ Hematology, CNS and Ophthalmology products.

We primarily focus on Phase I and II research

of new drug candidates and out license the post-Phase-II products to pharmaceutical companies;

we do not expect to devote substantial

efforts and resources to building the disease-specific distribution channels.

Business Objectives

The Company is operating its core business based

on collaborative activities that can generate current and future revenues through research, development and/or commercialization joint

venture agreements.

The terms of these agreements typically include payment to the Company related to one or more of the following:

plan to augment our core research and development capability and assets by conducting Phase I and II clinical trials for investigational

new drugs and medical devices in the fields of CNS, Hematology/Oncology and Ophthalmology.

management team has extensive experiences across a wide range of new drug and medical device development, and we have in-licensed new

drug and medical device candidates from large research institutes and universities in both the U.S.

Through an assertive

product development approach, we expect that we will build a substantial portfolio of Oncology/ Hematology, CNS and Ophthalmology products.

We primarily focus on Phase I and II research of new drug candidates and out license the post-Phase-II products to pharmaceutical companies;

we do not expect to devote substantial efforts and resources to building the disease-specific distribution channels.

Company is operating its core business based on collaborative activities that can generate current and future revenues through research,

development and/or commercialization joint venture agreements.

The terms of these agreements typically include payment to the Company

related to one or more of the following:

nonrefundable

upfront license fees,

● development

and commercial milestones,

1 unchanged sentence

on net sales of licensed products.

Each type of payments results in revenue except

for revenue from royalties on net sales of licensed products, which are classified as royalty revenues.

To date, we have not received

any royalty revenues.

Revenue is recognized upon satisfaction of a performance obligation by transferring control of a good or service

to the joint venture partner.

As part of the accounting for these arrangements,

the Company applies judgment to determine whether the performance obligations are distinct and develop assumptions in determining the

stand-alone selling price for each distinct performance obligation identified in the collaboration agreements.

To determine the stand-alone

selling price, the Company relies on assumptions which may include forecasted revenues, development timelines, reimbursement rates for

R&D personnel costs, discount rates and probabilities of technical and regulatory success.

The Company had multiple deliverables under the

collaborative agreements, including deliverables relating to grants of technology licenses, regulatory and clinical development, and marketing

Estimation of the performance periods of the Company’s deliverables requires the use of management’s judgment.

Significant factors considered in management’s evaluation of the estimated performance periods include, but are not limited to,

the Company’s experience in conducting clinical development, regulatory and manufacturing activities.

The Company reviews the estimated

duration of its performance periods under its collaborative agreements on an annual basis, and makes any appropriate adjustments on a

prospective basis.

Future changes in estimates of the performance period under its collaborative agreements could impact the timing of

future revenue recognition.

(i) Nonrefundable upfront payments

If a license to the Company’s intellectual

property is determined to be distinct from the other performance obligations identified in an arrangement, the Company recognizes revenue

from the related nonrefundable upfront payments based on the relative standalone selling price prescribed to the license compared to the

total selling price of the arrangement.

The revenue is recognized when the license is transferred to the collaboration partners and the

collaboration partners are able to use and benefit from the license.

To date, the receipt of nonrefundable upfront fees was solely for

the compensation of past research efforts and contributions made by the Company before the collaborative agreements were entered into

and does not relate to any future obligations and commitments made between the Company and the collaboration partners in the collaborative

(ii) Milestone payments

The Company is eligible to receive milestone payments

under the collaborative agreement with collaboration partners based on achievement of specified development, regulatory and commercial

Management evaluated the nature of the events triggering these contingent payments, and concluded that these events fall into

two categories:

(a) events which involve the performance of the Company’s obligations under the collaborative agreement with collaboration

partners, and (b) events which do not involve the performance of the Company’s obligations under the collaborative agreement with

collaboration partners.

The former category of milestone payments consists

of those triggered by development and regulatory activities in the territories specified in the collaborative agreements.

Management concluded

that each of these payments constitute substantive milestone payments.

This conclusion was based primarily on the facts that (i) each

triggering event represents a specific outcome that can be achieved only through successful performance by the Company of one or more

of its deliverables, (ii) achievement of each triggering event was subject to inherent risk and uncertainty and would result in additional

payments becoming due to the Company, (iii) each of the milestone payments is nonrefundable, (iv) substantial effort is required to complete

each milestone, (v) the amount of each milestone payment is reasonable in relation to the value created in achieving the milestone, (vi)

a substantial amount of time is expected to pass between the upfront payment and the potential milestone payments, and (vii) the milestone

payments relate solely to past performance.

Based on the foregoing, the Company recognizes any revenue from these milestone payments in

the period in which the underlying triggering event occurs.

(iii) Multiple Element Arrangements

The Company evaluates multiple element arrangements

to determine (1) the deliverables included in the arrangement and (2) whether the individual deliverables represent separate units of

accounting or whether they must be accounted for as a combined unit of accounting.

This evaluation involves subjective determinations

and requires management to make judgments about the individual deliverables and whether such deliverables are separate from other aspects

of the contractual relationship.

type of payments results in revenue except for revenue from royalties on net sales of licensed products, which are classified as royalty

To date, we have not received any royalty revenues.

Revenue is recognized upon satisfaction of a performance obligation by

transferring control of a good or service to the joint venture partner.

part of the accounting for these arrangements, the Company applies judgment to determine whether the performance obligations are distinct

and develop assumptions in determining the stand-alone selling price for each distinct performance obligation identified in the collaboration

To determine the stand-alone selling price, the Company relies on assumptions which may include forecasted revenues, development

timelines, reimbursement rates for R&D personnel costs, discount rates and probabilities of technical and regulatory success.

Company had multiple deliverables under the collaborative agreements, including deliverables relating to grants of technology licenses,

regulatory and clinical development, and marketing activities.

Estimation of the performance periods of the Company’s deliverables

requires the use of management’s judgment.

Significant factors considered in management’s evaluation of the estimated performance

periods include, but are not limited to, the Company’s experience in conducting clinical development, regulatory and manufacturing

The Company reviews the estimated duration of its performance periods under its collaborative agreements on an annual basis,

and makes any appropriate adjustments on a prospective basis.

Future changes in estimates of the performance period under its collaborative

agreements could impact the timing of future revenue recognition.

Nonrefundable upfront payments

a license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified

in an arrangement, the Company recognizes revenue from the related nonrefundable upfront payments based on the relative standalone selling

price prescribed to the license compared to the total selling price of the arrangement.

The revenue is recognized when the license is

transferred to the collaboration partners and the collaboration partners are able to use and benefit from the license.

To date, the receipt

of nonrefundable upfront fees was solely for the compensation of past research efforts and contributions made by the Company before the

collaborative agreements were entered into and does not relate to any future obligations and commitments made between the Company and

the collaboration partners in the collaborative agreements.

Milestone payments

Company is eligible to receive milestone payments under the collaborative agreement with collaboration partners based on achievement

of specified development, regulatory and commercial events.

Management evaluated the nature of the events triggering these contingent

payments, and concluded that these events fall into two categories:

(a) events which involve the performance of the Company’s obligations

under the collaborative agreement with collaboration partners, and (b) events which do not involve the performance of the Company’s

obligations under the collaborative agreement with collaboration partners.

former category of milestone payments consists of those triggered by development and regulatory activities in the territories specified

in the collaborative agreements.

Management concluded that each of these payments constitute substantive milestone payments.

This conclusion

was based primarily on the facts that (i) each triggering event represents a specific outcome that can be achieved only through successful

performance by the Company of one or more of its deliverables, (ii) achievement of each triggering event was subject to inherent risk

and uncertainty and would result in additional payments becoming due to the Company, (iii) each of the milestone payments is nonrefundable,

(iv) substantial effort is required to complete each milestone, (v) the amount of each milestone payment is reasonable in relation to

the value created in achieving the milestone, (vi) a substantial amount of time is expected to pass between the upfront payment and the

potential milestone payments, and (vii) the milestone payments relate solely to past performance.

Based on the foregoing, the Company

recognizes any revenue from these milestone payments in the period in which the underlying triggering event occurs.

Multiple Element Arrangements

Company evaluates multiple element arrangements to determine (1) the deliverables included in the arrangement and (2) whether the individual

deliverables represent separate units of accounting or whether they must be accounted for as a combined unit of accounting.

This evaluation

involves subjective determinations and requires management to make judgments about the individual deliverables and whether such deliverables

are separate from other aspects of the contractual relationship.

Deliverables are considered separate units of accounting provided that:

(i) the delivered item(s) has

value to the customer on a standalone basis and (ii) if the arrangement includes a general right of return relative to the delivered item(s),

delivery or performance of the undelivered item(s) is considered probable and substantially within its control.

In assessing whether an

item under a collaboration has standalone value, the Company considers factors such as the research, manufacturing, and commercialization

capabilities of the collaboration partner and the availability of the associated expertise in the general marketplace.

The Company also

considers whether its collaboration partners can use the other deliverable(s) for their intended purpose without the receipt of the remaining

element(s), whether the value of the deliverable is dependent on the undelivered item(s), and whether there are other vendors that can

provide the undelivered element(s).

The Company recognizes arrangement consideration

allocated to each unit of accounting when all of the revenue recognition criteria in ASC 606 are satisfied for that particular unit of

In the event that a deliverable does not represent a separate unit of accounting, the Company recognizes revenue from the

combined unit of accounting over the Company’s contractual or estimated performance period for the undelivered elements, which is

typically the term of the Company’s research and development obligations.

If there is no discernible pattern of performance or objectively

measurable performance measures do not exist, then the Company recognizes revenue under the arrangement on a straight-line basis over

the period the Company is expected to complete its performance obligations.

Conversely, if the pattern of performance in which the service

is provided to the customer can be determined and objectively measurable performance measures exist, then the Company recognizes revenue

under the arrangement using the proportional performance method.

Revenue recognized is limited to the lesser of the cumulative amount

of payments received or the cumulative amount of revenue earned, as determined using the straight-line method or proportional performance

method, as applicable, as of the period ending date.

At the inception of an arrangement that includes

milestone payments, the Company evaluates whether each milestone is substantive and at risk to both parties on the basis of the contingent

nature of the milestone.

(i) the delivered item(s) has value to the customer on a standalone basis and (ii) if the arrangement includes a general right of return

relative to the delivered item(s), delivery or performance of the undelivered item(s) is considered probable and substantially within

In assessing whether an item under a collaboration has standalone value, the Company considers factors such as the research,

manufacturing, and commercialization capabilities of the collaboration partner and the availability of the associated expertise in the

general marketplace.

The Company also considers whether its collaboration partners can use the other deliverable(s) for their intended

purpose without the receipt of the remaining element(s), whether the value of the deliverable is dependent on the undelivered item(s),

and whether there are other vendors that can provide the undelivered element(s).

Company recognizes arrangement consideration allocated to each unit of accounting when all of the revenue recognition criteria in ASC

606 are satisfied for that particular unit of accounting.

In the event that a deliverable does not represent a separate unit of accounting,

the Company recognizes revenue from the combined unit of accounting over the Company’s contractual or estimated performance period

for the undelivered elements, which is typically the term of the Company’s research and development obligations.

If there is no

discernible pattern of performance or objectively measurable performance measures do not exist, then the Company recognizes revenue under

the arrangement on a straight-line basis over the period the Company is expected to complete its performance obligations.

if the pattern of performance in which the service is provided to the customer can be determined and objectively measurable performance

measures exist, then the Company recognizes revenue under the arrangement using the proportional performance method.

Revenue recognized

is limited to the lesser of the cumulative amount of payments received or the cumulative amount of revenue earned, as determined using

the straight-line method or proportional performance method, as applicable, as of the period ending date.

the inception of an arrangement that includes milestone payments, the Company evaluates whether each milestone is substantive and at

risk to both parties on the basis of the contingent nature of the milestone.

This evaluation includes an assessment of whether:

(1) the consideration is commensurate with either the Company’s

performance to achieve the milestone or the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting

from its performance to achieve the milestone, (2) the consideration relates solely to past performance and (3) the consideration is reasonable

relative to all of the deliverables and payment terms within the arrangement.

The Company evaluates factors such as the scientific, clinical,

regulatory, commercial, and other risks that must be overcome to achieve the particular milestone and the level of effort and investment

required to achieve the particular milestone in making this assessment.

There is considerable judgment involved in determining whether

a milestone satisfies all of the criteria required to conclude that a milestone is substantive.

Milestones that are not considered substantive

are recognized as earned if there are no remaining performance obligations or over the remaining period of performance, assuming all other

revenue recognition criteria are met.

(iv) Royalties and Profit-Sharing Payments

Under the collaborative agreement with the collaboration

partners, the Company is entitled to receive royalties on sales of products, which is at certain percentage of the net sales.

recognizes revenue from these events based on the revenue recognition criteria set forth in ASC 606.

Based on those criteria, the Company

considers these payments to be contingent revenues, and recognizes them as revenue in the period in which the applicable contingency is

Revenues Derived from Research and Development

Activities Services — Revenues related to research and development and regulatory activities are recognized when the related services

or activities are performed, in accordance with the contract terms.

The Company typically has only one performance obligation at the inception

of a contract, which is to perform research and development services.

The Company may also provide its customers with an option to request

that the Company provides additional goods or services in the future, such as active pharmaceutical ingredient, API, or IND/NDA/ANDA/510K

The Company evaluates whether these options are material rights at the inception of the contract.

If the Company determines

an option is a material right, the Company will consider the option a separate performance obligation.

If the Company is entitled to reimbursement from

its customers for specified research and development expenses, the Company accounts for the related services that it provides as separate

performance obligations if it determines that these services represent a material right.

The Company also determines whether the reimbursement

of research and development expenses should be accounted for as revenues or an offset to research and development expenses in accordance

with provisions of gross or net revenue presentation.

The Company recognizes the corresponding revenues or records the corresponding offset

to research and development expenses as it satisfies the related performance obligations.

The Company then determines the transaction price

by reviewing the amount of consideration the Company is eligible to earn under the contracts, including any variable consideration.

the outstanding contracts, consideration typically includes fixed consideration and variable consideration in the form of potential milestone

At the start of an agreement, the Company’s transaction price usually consists of the payments made to or by the Company

based on the number of full-time equivalent researchers assigned to the project and the related research and development expenses incurred.

The Company does not typically include any payments that the Company may receive in the future in its initial transaction price because

the payments are not probable.

The Company would reassess the total transaction price at each reporting period to determine if the Company

should include additional payments in the transaction price.

The Company receives payments from its customers

based on billing schedules established in each contract.

Upfront payments and fees may be recorded as contract liabilities upon receipt

or when due, and may require deferral of revenue recognition to a future period until the Company performs its obligations under these

arrangements.

Amounts are recorded as accounts receivable when the right of the Company to consideration is unconditional.

does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period

between payment by the customers and the transfer of the promised goods or services to the customers will be one year or less.

Examples of collaborative agreements the Company

has entered into are as follows:

Collaborative agreements with BHK, a related

In February and December of 2015, BioLite, Inc.

entered into a total of three joint venture agreements with BioHopeKing to jointly develop ABV-1501 for Triple Negative Breast Cancer (TNBC), ABV-1504 for MDD and ABV-1505 for ADHD.

The agreements granted marketing rights to BioHopeKing for certain Asian countries in return for a series of milestone payments totaling $10 million in cash and equity of BioHopeKing or equity securities owned by BioHopeKing.

The milestone payments are determined by a schedule

of BioLite development achievements as shown below:

Execution of BHK Co-Development Agreement

Investigational New Drug (IND) Submission

Phase II Clinical Trial Complete

Initiation of Phase III Clinical Trial

New Drug Application (NDA) Submission

In December of 2015, BHK paid the initial cash payment of $1 million upon the execution of the BHK Agreement.

The Company concluded that certain deliverables are considered separate units of accounting as the delivered items have value to the customer on a standalone basis and recognized this cash payment as collaboration revenue when all research, technical, and development data was delivered to BHK in 2015.

The payment included compensation for past research efforts and contributions made by BioLite Taiwan before the BHK agreement was signed and does not relate to any future commitments made by BioLite Taiwan and BHK in the BHK Agreement.

In August 2016, the Company received the second milestone payment of $1 million, and recognized collaboration revenue for the year ended December 31, 2016.

As of June 30, 2023, the Company had completed the phase II clinical trial for ABV-1504 MDD on October 31, 2019, but has not yet completed the phase II clinical trial for ABV-1505 ADHD.

In addition to the milestone payments, BioLite Inc.

is entitled to receive a royalty equal to 12% of BHK’s net sales related to ABV-1501, ABV-1504 and ABV-1505 Products.

As of June 30, 2023, the Company has not earned royalties under the BHK Co-Development Agreement.

The BHK Co-Development Agreement will remain in effect for fifteen years from the date of first commercial sale of the Product in in Asia excluding Japan.

Collaborative agreement with BioLite, Inc.,

a related party

The Company entered into a collaborative agreement

with BioLite, Inc.

on December 29, 2015, and then entered into two addendums to such agreement, as amended and revised, (the “BioLite

The majority shareholder of BioLite is one of the Company’s subsidiaries, Mr.

Jiang, the Company’s Chairman

is a director of BioLite and Dr.

Jiang, the Company’s Chief Strategy Officer and a director, is the Chairman of BioLite.

Pursuant to the BioLite Agreement, the Company

acquired the sole licensing rights to develop and commercialize for therapeutic purposes six compounds from BioLite.

In accordance with

the terms of the Agreement, the Company shall pay BioLite (i) milestone payments of up to $100 million in cash and equity of the Company

or equity securities owned by it at various stages on a schedule dictated by BioLite’s achievements of certain milestones, as set

forth in the Agreement (the “Milestone Payments”) and (ii) a royalty payment equal to 5% of net sales of the drug products

when ABV-1501 is approved for sale in the licensed territories.

If BioLite fails to reach any of the milestones in a timely manner, it

may not receive the rest of the payments from the Company.

According to the BioLite Agreement, after Phase

II clinical trials are completed, 15% of the Milestone Payment becomes due and shall be paid in two stages:

(i) 5% no later than December

31, 2021 (the “December 2021 Payment”) and (ii) 10% no later than December 31, 2022.

On February 12, 2022, the Company’s Board

of Directors determined that the December 2021 Payment, which is equal to $5,000,000, shall be paid via the cancellation of certain outstanding

debt, in the amount of $5,000,000, that BioLite owes the Company as of December 31, 2021.

On February 22, 2022, the parties entered into

an amendment to the BioLite Agreement allowing the Company to make all payments due under the Agreement via the forgiveness of debt, in

equal value, owed by BioLite to the Company.

This was a related party transaction.

Co-Development agreement with Rgene Corporation,

a related party

On May 26, 2017, BriVision entered into a co-development

agreement (the “Co-Dev Agreement”) with Rgene Corporation (the “Rgene”), a related party under common control

by controlling beneficiary shareholder of YuanGene Corporation and the Company (See Note 8).

Pursuant to Co-Dev Agreement, BriVision and

Rgene agreed to co-develop and commercialize ABV-1507 HER2/neu Positive Breast Cancer Combination Therapy, ABV-1511 Pancreatic Cancer

Combination Therapy and ABV-1527 Ovary Cancer Combination Therapy.

Under the terms of the Co-Dev Agreement, Rgene is required to pay

the Company $3,000,000 in cash or stock of Rgene with equivalent value by August 15, 2017.

The payment is for the compensation of BriVision’s

past research efforts and contributions made by BriVision before the Co-Dev Agreement was signed and it does not relate to any future

commitments made by BriVision and Rgene in this Co-Dev Agreement.

In addition to $3,000,000, the Company is entitled to receive 50% of

the future net licensing income or net sales profit earned by Rgene, if any, and any development costs shall be equally shared by both

BriVision and Rgene.

On June 1, 2017, the Company has delivered all

research, technical, data and development data to Rgene.

Since both Rgene and the Company are related parties and under common control

by a controlling beneficiary shareholder of YuanGene Corporation and the Company, the Company has recorded the full amount of $3,000,000

in connection with the Co-Dev Agreement as additional paid-in capital during the year ended December 31, 2017.

During the year ended December

31, 2017, the Company has received $450,000 in cash.

On December 24, 2018, the Company received the remaining balance of $2,550,000 in

the form of newly issued shares of Rgene’s Common Stock, at the price of NT$50 (approximately equivalent to $1.64 per share), for

an aggregate number of 1,530,000 shares, which accounted for equity method long-term investment as of December 31, 2018.

During the year

ended December 31, 2018, the Company has recognized investment loss of $549.

On December 31, 2018, the Company determined to fully write

off this investment based on the Company’s assessment of the severity and duration of the impairment, and qualitative and quantitative

analysis of the operating performance of the investee, adverse changes in market conditions and the regulatory or economic environment,

changes in operating structure of Rgene, additional funding requirements, and Rgene’s ability to remain in business.

that have been initiated will be managed and supported by the Company and Rgene.

The Company and Rgene signed an amendment to the

Rgene Agreement on November 10, 2020, pursuant to which both parties agreed to delete AB-1507 HER2/neu Positive Breast Cancer Combination

Therapy and AB-1527 Ovary Cancer Combination Therapy and add ABV-1519 EGFR Positive Non-Small Cell Lung Cancer Combination Therapy and

ABV-1526 Large Intestine / Colon / Rectal Cancer Combination Therapy to the products to be co-developed and commercialized.

Other provisions

of the Rgene Agreement remain in full force and effect.

Clinical Development Service Agreement with

Rgene Corporation, a related party

On June 10, 2022, the Company its co-development

partnership with Rgene.

The Company’s subsidiary, BioKey, entered into a Clinical Development Service Agreement with Rgene (“Service

Agreement”) to guide certain Rgene drug products, RGC-1501 for the treatment of Non-Small Cell Lung Cancer (NSCLC), RGC-1502 for

the treatment of pancreatic cancer and RGC 1503 for the treatment of colorectal cancer patients, through completion of Phase II clinical

studies under U.S.

FDA IND regulatory requirements (the “Rgene Studies”).

Under the terms of the Service Agreement, BioKey

is eligible to receive payments totaling up to $3.0 million over a 3-year period with each payment amount to be determined by certain

regulatory milestones obtained during the agreement period.

Through a series of transactions over the past

5 years, the Company and Rgene have co-developed the three drug products covered by the Service Agreement, which has resulted in the Company

owning 31.62% of Rgene.

As part of the Rgene Studies, the Company agreed

to loan $1.0 million to Rgene, for which Rgene has provided the Company with a 5% working capital convertible loan (the “Note”).

If the Note is fully converted, the Company will own an additional 6.4% of Rgene.

The Company is expected to receive the outstanding loan

from the related party by the 2023 Q1, either by cash or conversion of shares of Rgene.

The Company may convert the Note

at any time into shares of Rgene’s common stock at either (i) a fixed conversion price equal to $1.00 per share or (ii) 20% discount

of the stock price of the then most recent offering, whichever is lower;

the conversion price is subject to adjustment as set forth in

The Note includes standard events of default, as well as a cross default provision pursuant to which a breach of the Service

Agreement will trigger an event of default under the Note if not cured after 5 business days of written notice regarding the breach is

Upon an event of default, the outstanding principal and any accrued and unpaid interest shall be immediately due and payable.

The Service Agreement shall remain in effect until

the expiration date of the last patent and automatically renew for 5 more years unless terminated earlier by either party with six months

consideration is commensurate with either the Company’s performance to achieve the milestone or the enhancement of the value of

the delivered item(s) as a result of a specific outcome resulting from its performance to achieve the milestone, (2) the consideration

relates solely to past performance and (3) the consideration is reasonable relative to all of the deliverables and payment terms within

the arrangement.

The Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be

overcome to achieve the particular milestone and the level of effort and investment required to achieve the particular milestone in making

this assessment.

There is considerable judgment involved in determining whether a milestone satisfies all of the criteria required to

conclude that a milestone is substantive.

Milestones that are not considered substantive are recognized as earned if there are no remaining

performance obligations or over the remaining period of performance, assuming all other revenue recognition criteria are met.

Royalties and Profit-Sharing Payments

the collaborative agreement with the collaboration partners, the Company is entitled to receive royalties on sales of products, which

is at certain percentage of the net sales.

The Company recognizes revenue from these events based on the revenue recognition criteria

set forth in ASC 606.

Based on those criteria, the Company considers these payments to be contingent revenues, and recognizes them as

revenue in the period in which the applicable contingency is resolved.

Derived from Research and Development Activities Services — Revenues related to research and development and regulatory activities

are recognized when the related services or activities are performed, in accordance with the contract terms.

The Company typically has

only one performance obligation at the inception of a contract, which is to perform research and development services.

The Company may

also provide its customers with an option to request that the Company provides additional goods or services in the future, such as active

pharmaceutical ingredient, API, or IND/NDA/ANDA/510K submissions.

The Company evaluates whether these options are material rights at

the inception of the contract.

If the Company determines an option is a material right, the Company will consider the option a separate

performance obligation.

the Company is entitled to reimbursement from its customers for specified research and development expenses, the Company accounts for

the related services that it provides as separate performance obligations if it determines that these services represent a material right.

The Company also determines whether the reimbursement of research and development expenses should be accounted for as revenues or an

offset to research and development expenses in accordance with provisions of gross or net revenue presentation.

The Company recognizes

the corresponding revenues or records the corresponding offset to research and development expenses as it satisfies the related performance

Company then determines the transaction price by reviewing the amount of consideration the Company is eligible to earn under the contracts,

including any variable consideration.

Under the outstanding contracts, consideration typically includes fixed consideration and variable

consideration in the form of potential milestone payments.

At the start of an agreement, the Company’s transaction price usually

consists of the payments made to or by the Company based on the number of full-time equivalent researchers assigned to the project and

the related research and development expenses incurred.

The Company does not typically include any payments that the Company may receive

in the future in its initial transaction price because the payments are not probable.

The Company would reassess the total transaction

price at each reporting period to determine if the Company should include additional payments in the transaction price.

Company receives payments from its customers based on billing schedules established in each contract.

Upfront payments and fees may be

recorded as contract liabilities upon receipt or when due, and may require deferral of revenue recognition to a future period until the

Company performs its obligations under these arrangements.

Amounts are recorded as accounts receivable when the right of the Company

to consideration is unconditional.

The Company does not assess whether a contract has a significant financing component if the expectation

at contract inception is such that the period between payment by the customers and the transfer of the promised goods or services to

the customers will be one year or less.

of collaborative agreements the Company has entered into are as follows:

Collaborative

agreements with BHK, a related party

February and December of 2015, BioLite, Inc.

entered into a total of three joint venture agreements with BioHopeKing to jointly develop

ABV-1501 for Triple Negative Breast Cancer (TNBC), ABV-1504 for MDD and ABV-1505 for ADHD.

The agreements granted marketing rights

to BioHopeKing for certain Asian countries in return for a series of milestone payments totaling $10 million in cash and equity of

BioHopeKing or equity securities owned by BioHopeKing.

milestone payments are determined by a schedule of BioLite development achievements as shown below:

of BHK Co-Development Agreement

Investigational

New Drug (IND) Submission

II Clinical Trial Complete

of Phase III Clinical Trial

Drug Application (NDA) Submission

December of 2015, BHK paid the initial cash payment of $1 million upon the execution of the BHK Agreement.

The Company concluded

that certain deliverables are considered separate units of accounting as the delivered items have value to the customer on a standalone

basis and recognized this cash payment as collaboration revenue when all research, technical, and development data was delivered

to BHK in 2015.

The payment included compensation for past research efforts and contributions made by BioLite Taiwan before the BHK

agreement was signed and does not relate to any future commitments made by BioLite Taiwan and BHK in the BHK Agreement.

August 2016, the Company received the second milestone payment of $1 million, and recognized collaboration revenue for the year ended

December 31, 2016.

The Company completed the phase II clinical trial for ABV-1504 MDD on October 31, 2019, but has not yet completed

the phase II clinical trial for ABV-1505 ADHD.

addition to the milestone payments, BioLite Inc.

is entitled to receive a royalty equal to 12% of BHK’s net sales related to

ABV-1501, ABV-1504 and ABV-1505 Products.

As of September 30, 2023, the Company has not earned royalties under the BHK Co-Development

BHK Co-Development Agreement will remain in effect for fifteen years from the date of first commercial sale of the Product in in

Asia excluding Japan.

Collaborative

agreement with BioLite, Inc., a related party

Company entered into a collaborative agreement with BioLite, Inc.

on December 29, 2015, and then entered into two addendums to such agreement,

as amended and revised, (the “BioLite Agreement”).

The majority shareholder of BioLite is one of the Company’s subsidiaries,

Jiang, the Company’s Chairman is a director of BioLite and Dr.

Jiang, the Company’s Chief Strategy Officer and a director,

is the Chairman of BioLite.

to the BioLite Agreement, the Company acquired the sole licensing rights to develop and commercialize for therapeutic purposes six compounds

from BioLite.

In accordance with the terms of the Agreement, the Company shall pay BioLite (i) milestone payments of up to $100 million

in cash and equity of the Company or equity securities owned by it at various stages on a schedule dictated by BioLite’s achievements

of certain milestones, as set forth in the Agreement (the “Milestone Payments”) and (ii) a royalty payment equal to 5% of

net sales of the drug products when ABV-1501 is approved for sale in the licensed territories.

If BioLite fails to reach any of the milestones

in a timely manner, it may not receive the rest of the payments from the Company.

to the BioLite Agreement, after Phase II clinical trials are completed, 15% of the Milestone Payment becomes due and shall be paid in

(i) 5% no later than December 31, 2021 (the “December 2021 Payment”) and (ii) 10% no later than December 31,

February 12, 2022, the Company’s Board of Directors determined that the December 2021 Payment, which is equal to $5,000,000, shall

be paid via the cancellation of certain outstanding debt, in the amount of $5,000,000, that BioLite owes the Company as of December 31,

February 22, 2022, the parties entered into an amendment to the BioLite Agreement allowing the Company to make all payments due under

the Agreement via the forgiveness of debt, in equal value, owed by BioLite to the Company.

September 13, 2023, the BioLite received a new patent granted notice (application no.

109130285) for PDC-1421 from the Intellectual Property

Office of Taiwan.

was a related party transaction.

Co-Development

agreement with Rgene Corporation, a related party

May 26, 2017, BriVision entered into a co-development agreement (the “Co-Dev Agreement”) with Rgene Corporation (the “Rgene”),

a related party under common control by controlling beneficiary shareholder of YuanGene Corporation and the Company (See Note 8).

to Co-Dev Agreement, BriVision and Rgene agreed to co-develop and commercialize ABV-1507 HER2/neu Positive Breast Cancer Combination

Therapy, ABV-1511 Pancreatic Cancer Combination Therapy and ABV-1527 Ovary Cancer Combination Therapy.

Under the terms of the Co-Dev

Agreement, Rgene is required to pay the Company $3,000,000 in cash or stock of Rgene with equivalent value by August 15, 2017.

payment is for the compensation of BriVision’s past research efforts and contributions made by BriVision before the Co-Dev Agreement

was signed and it does not relate to any future commitments made by BriVision and Rgene in this Co-Dev Agreement.

In addition to $3,000,000,

the Company is entitled to receive 50% of the future net licensing income or net sales profit earned by Rgene, if any, and any development

costs shall be equally shared by both BriVision and Rgene.

June 1, 2017, the Company has delivered all research, technical, data and development data to Rgene.

Since both Rgene and the Company

are related parties and under common control by a controlling beneficiary shareholder of YuanGene Corporation and the Company, the Company

has recorded the full amount of $3,000,000 in connection with the Co-Dev Agreement as additional paid-in capital during the year ended

December 31, 2017.

During the year ended December 31, 2017, the Company has received $450,000 in cash.

On December 24, 2018, the Company

received the remaining balance of $2,550,000 in the form of newly issued shares of Rgene’s Common Stock, at the price of NT$50

(approximately equivalent to $1.64 per share), for an aggregate number of 1,530,000 shares, which accounted for equity method long-term

investment as of December 31, 2018.

During the year ended December 31, 2018, the Company has recognized investment loss of $549.

31, 2018, the Company determined to fully write off this investment based on the Company’s assessment of the severity and duration

of the impairment, and qualitative and quantitative analysis of the operating performance of the investee, adverse changes in market

conditions and the regulatory or economic environment, changes in operating structure of Rgene, additional funding requirements, and

Rgene’s ability to remain in business.

All projects that have been initiated will be managed and supported by the Company and Rgene.

Company and Rgene signed an amendment to the Rgene Agreement on November 10, 2020, pursuant to which both parties agreed to delete AB-1507

HER2/neu Positive Breast Cancer Combination Therapy and AB-1527 Ovary Cancer Combination Therapy and add ABV-1519 EGFR Positive Non-Small

Cell Lung Cancer Combination Therapy and ABV-1526 Large Intestine / Colon / Rectal Cancer Combination Therapy to the products to be co-developed

and commercialized.

Other provisions of the Rgene Agreement remain in full force and effect.

Development Service Agreement with Rgene Corporation, a related party

June 10, 2022, the Company expanded its co-development partnership with Rgene.

The Company’s subsidiary, BioKey, entered into a

Clinical Development Service Agreement with Rgene (“Service Agreement”) to guide certain Rgene drug products, RGC-1501 for

the treatment of Non-Small Cell Lung Cancer (NSCLC), RGC-1502 for the treatment of pancreatic cancer and RGC 1503 for the treatment of

colorectal cancer patients, through completion of Phase II clinical studies under U.S.

FDA IND regulatory requirements (the “Rgene

Under the terms of the Service Agreement, BioKey is eligible to receive payments totaling up to $3.0 million over a

3-year period with each payment amount to be determined by certain regulatory milestones obtained during the agreement period.

Agreement shall remain in effect until the expiration date of the last patent and automatically renew for 5 more years unless terminated

earlier by either party with six months written notice.

Either party may terminate the Service Agreement for cause by providing 30 days

written notice.

Either party may terminate the Service Agreement for cause by providing 30 days written notice.

Rgene has further agreed, effective July 1, 2022,

to provide the Company with a seat on Rgene’s Board of Directors until the loan is repaid in full.

a series of transactions over the past 5 years, the Company and Rgene have co-developed the three drug products covered by the Service

Agreement, which has resulted in the Company owning 31.62% of Rgene.

part of the Rgene Studies, the Company agreed to loan $1.0 million to Rgene, for which Rgene has provided the Company with a 5% working

capital convertible loan (the “Note”).

If the Note is fully converted, the Company will own an additional 6.4% of Rgene.

The Company is expected to receive the outstanding loan from the related party by the 2023 Q4, either by cash or conversion of shares

The Company may convert the Note at any time into shares of Rgene’s common stock at either (i) a fixed conversion price

equal to $1.00 per share or (ii) 20% discount of the stock price of the then most recent offering, whichever is lower;

the conversion

price is subject to adjustment as set forth in the Note.

The Note includes standard events of default, as well as a cross default provision

pursuant to which a breach of the Service Agreement will trigger an event of default under the Note if not cured after 5 business days

of written notice regarding the breach is provided.

Upon an event of default, the outstanding principal and any accrued and unpaid interest

shall be immediately due and payable.

Service Agreement shall remain in effect until the expiration date of the last patent and automatically renew for 5 more years unless

terminated earlier by either party with six months written notice.

Either party may terminate the Service Agreement for cause by providing

30 days written notice.

has further agreed, effective July 1, 2022, to provide the Company with a seat on Rgene’s Board of Directors until the loan is

repaid in full.

The Company has nominated Dr.

Jiang, its Chief Strategy Officer and Director to occupy that seat;

Jiang is also one of the Company’s largest shareholders,

owning 12.8% of the Company.

The Rgene Studies is a related party transaction.

Collaborative agreement with BioFirst Corporation,

a related party

On July 24, 2017, BriVision entered into a collaborative

agreement (the “BioFirst Collaborative Agreement”) with BioFirst Corporation (“BioFirst”), pursuant to which BioFirst

granted the Company the global licensing right for medical use of the product (the “Product”):

BFC-1401 Vitreous Substitute

for Vitrectomy.

BioFirst is a related party to the Company because a controlling beneficiary shareholder of YuanGene Corporation and the

Company is one of the directors and Common Stock shareholders of BioFirst (See Note 8).

Pursuant to the BioFirst Collaborative Agreement,

the Company will co-develop and commercialize the Product with BioFirst and pay BioFirst in a total amount of $3,000,000 in cash or stock

of the Company before September 30, 2018.

The amount of $3,000,000 is in connection with the compensation for BioFirst’s past research

efforts and contributions made by BioFirst before the BioFirst Collaborative Agreement was signed and it does not relate to any future

commitments made by BioFirst and BriVision in this BioFirst Collaborative Agreement.

In addition, the Company is entitled to receive 50%

of the future net licensing income or net sales profit, if any, and any development cost shall be equally shared by both BriVision and

On September 25, 2017, BioFirst has delivered

all research, technical, data and development data to BriVision.

The Company determined to fully expense the entire amount of $3,000,000

since currently the related licensing rights do not have alternative future uses.

According to ASC 730-10-25-1, absent alternative future

uses the acquisition of product rights to be used in research and development activities must be charged to research and development expenses

Hence, the entire amount of $3,000,000 is fully expensed as research and development expense during the year ended December

On June 30, 2019, BriVision entered into a Stock

Purchase Agreement (the “Purchase Agreement”) with BioFirst Corporation.

Pursuant to the Purchase Agreement, the Company issued

428,571 shares of the Company’s common stock to BioFirst in consideration for $3,000,000 owed by the Company to BioFirst (the “Total

Payment”) in connection with a certain collaborative agreement between the Company and BioFirst dated July 24, 2017 (the “Collaborative

Pursuant to the Collaborative Agreement, BioFirst granted the Company the global licensing right to co-develop BFC-1401

or ABV-1701 Vitreous Substitute for Vitrectomy for medical purposes in consideration for the Total Payment.

On August 5, 2019, BriVision entered into a second

Stock Purchase Agreement (“Purchase Agreement 2”) with BioFirst Corporation.

Pursuant to Purchase Agreement 2, the Company

issued 414,702 shares of the Company’s common stock to BioFirst in consideration for $2,902,911 owed by the Company to BioFirst

in connection with a loan provided to BriVision from BioFirst.

On November 4, 2020, the Company executed an amendment

to the BioFirst Agreement with BioFirst, to add ABV-2001 Intraocular Irrigation Solution and ABV-2002 Corneal Storage Solution to the

ABV-2002 is utilized during a corneal transplant procedure to replace a damaged or diseased cornea, while ABV-2001 has broader

utilization during a variety of ocular procedures.

Initially, the Company will focus on ABV-2002,

a solution utilized to store a donor cornea prior to either penetrating keratoplasty (full thickness cornea transplant) or endothelial

keratoplasty (back layer cornea transplant).

ABV-2002 is a solution comprised of a specific poly amino acid that is intended to protect

ocular tissue from damage caused by external osmolarity exposure during pre-surgery storage.

The specific polymer in ABV-2002 can adjust

osmolarity to maintain a range of 330 to 390 mOsM, thereby permitting hydration within the corneal stroma during the storage period.

hydration typically results in (a) maintaining acceptable corneal transparency and (b) prevents donor cornea swelling.

ABV-2002 also contains

an abundant phenolic phytochemical found in plant cell walls that provides antioxidant antibacterial properties and neuroprotection.

Early testing by BioFirst indicates that ABV-2002

may be more effective for protecting the cornea and retina during long-term storage than other storage media available today and can be

manufactured at lower cost.

Further clinical development was put on hold due to the lack of funding.

In addition, BioFirst was incorporated on November

7, 2006, focusing on the R&D, manufacturing, and sales of innovative patented pharmaceutical products.

The technology of BioFirst

comes from the global exclusive licensing agreements BioFirst maintains with domestic R & D institutions.

Currently, BioFirst’s

main research and development product is the vitreous substitute (Vitargus ® ), licensed by the National Health Research

Vitargus is the world’s first bio-degradable vitreous substitute and offers a number of advantages over current vitreous

substitutes by minimizing medical complications and reducing the need for additional surgeries.

Vitargus has started the construction of a GMP

factory in Hsinchu Biomedical Science Park, Taiwan, with the aim at building a production base to supply the global market, and promote

the construction of bio-degradable vitreous substitute manufacturing centers in Taiwan.

Completion of this factory would allow ABVC to

manufacture Vitargus with world-class technology in a GMP certified pharmaceutical factory.

BioFirst is targeting to complete the construction

Jiang is also one

of the Company’s largest shareholders, owning 12.8% of the Company.

Rgene Studies is a related party transaction.

Collaborative

agreement with BioFirst Corporation, a related party

July 24, 2017, BriVision entered into a collaborative agreement (the “BioFirst Collaborative Agreement”) with BioFirst Corporation

(“BioFirst”), pursuant to which BioFirst granted the Company the global licensing right for medical use of the product (the

BFC-1401 Vitreous Substitute for Vitrectomy.

BioFirst is a related party to the Company because a controlling

beneficiary shareholder of YuanGene Corporation and the Company is one of the directors and Common Stock shareholders of BioFirst (See

to the BioFirst Collaborative Agreement, the Company will co-develop and commercialize the Product with BioFirst and pay BioFirst in

a total amount of $3,000,000 in cash or stock of the Company before September 30, 2018.

The amount of $3,000,000 is in connection with

the compensation for BioFirst’s past research efforts and contributions made by BioFirst before the BioFirst Collaborative Agreement

was signed and it does not relate to any future commitments made by BioFirst and BriVision in this BioFirst Collaborative Agreement.

In addition, the Company is entitled to receive 50% of the future net licensing income or net sales profit, if any, and any development

cost shall be equally shared by both BriVision and BioFirst.

September 25, 2017, BioFirst has delivered all research, technical, data and development data to BriVision.

The Company determined to

fully expense the entire amount of $3,000,000 since currently the related licensing rights do not have alternative future uses.

to ASC 730-10-25-1, absent alternative future uses the acquisition of product rights to be used in research and development activities

must be charged to research and development expenses immediately.

Hence, the entire amount of $3,000,000 is fully expensed as research

and development expense during the year ended December 31, 2017.

June 30, 2019, BriVision entered into a Stock Purchase Agreement (the “Purchase Agreement”) with BioFirst Corporation.

to the Purchase Agreement, the Company issued 428,571 shares of the Company’s common stock to BioFirst in consideration for $3,000,000

owed by the Company to BioFirst (the “Total Payment”) in connection with a certain collaborative agreement between the Company

and BioFirst dated July 24, 2017 (the “Collaborative Agreement”).

Pursuant to the Collaborative Agreement, BioFirst granted

the Company the global licensing right to co-develop BFC-1401 or ABV-1701 Vitreous Substitute for Vitrectomy for medical purposes in

consideration for the Total Payment.

August 5, 2019, BriVision entered into a second Stock Purchase Agreement (“Purchase Agreement 2”) with BioFirst Corporation.

Pursuant to Purchase Agreement 2, the Company issued 414,702 shares of the Company’s common stock to BioFirst in consideration

for $2,902,911 owed by the Company to BioFirst in connection with a loan provided to BriVision from BioFirst.

November 4, 2020, the Company executed an amendment to the BioFirst Agreement with BioFirst, to add ABV-2001 Intraocular Irrigation Solution

and ABV-2002 Corneal Storage Solution to the agreement.

ABV-2002 is utilized during a corneal transplant procedure to replace a damaged

or diseased cornea, while ABV-2001 has broader utilization during a variety of ocular procedures.

the Company will focus on ABV-2002, a solution utilized to store a donor cornea prior to either penetrating keratoplasty (full thickness

cornea transplant) or endothelial keratoplasty (back layer cornea transplant).

ABV-2002 is a solution comprised of a specific poly amino

acid that is intended to protect ocular tissue from damage caused by external osmolarity exposure during pre-surgery storage.

polymer in ABV-2002 can adjust osmolarity to maintain a range of 330 to 390 mOsM, thereby permitting hydration within the corneal stroma

during the storage period.

Stromal hydration typically results in (a) maintaining acceptable corneal transparency and (b) prevents donor

cornea swelling.

ABV-2002 also contains an abundant phenolic phytochemical found in plant cell walls that provides antioxidant antibacterial

properties and neuroprotection.

testing by BioFirst indicates that ABV-2002 may be more effective for protecting the cornea and retina during long-term storage than

other storage media available today and can be manufactured at lower cost.

Further clinical development was put on hold due to the lack

addition, BioFirst was incorporated on November 7, 2006, focusing on the R&D, manufacturing, and sales of innovative patented pharmaceutical

The technology of BioFirst comes from the global exclusive licensing agreements BioFirst maintains with domestic R & D

institutions.

Currently, BioFirst’s main research and development product is the vitreous substitute (Vitargus ® ),

licensed by the National Health Research Institutes.

Vitargus is the world’s first bio-degradable vitreous substitute and offers

a number of advantages over current vitreous substitutes by minimizing medical complications and reducing the need for additional surgeries.

has started the construction of a GMP factory in Hsinchu Biomedical Science Park, Taiwan, with the aim at building a production base

to supply the global market, and promote the construction of bio-degradable vitreous substitute manufacturing centers in Taiwan.

of this factory would allow ABVC to manufacture Vitargus with world-class technology in a GMP certified pharmaceutical factory.

is targeting to complete the construction in 2024.

above-mentioned equity is before the reverse stock split in 2023.

Co-Development agreement with BioLite Japan

On October 6, 2021 (the “ Completion Date ”),

the Company, Lucidaim Co., Ltd., a Japanese corporation (“ Lucidaim ,” together with the Company, the “ Shareholders ”),

and BioLite Japan K.K., a Japanese corporation (“ BioLite JP” ) entered into a Joint Venture Agreement (the “ Agreement ”).

BioLite JP is a private limited company (a Japanese Kabushiki Kaisha ) incorporated on December 18, 2018 and at the date of

the Agreement has 10,000 ordinary shares authorized, with 3,049 ordinary shares issued and outstanding (the “ Ordinary Shares ”).

Immediately prior to the execution of the Agreement, Lucidaim owned 1,501 ordinary shares and the Company owned the 1,548 ordinary shares.

The Shareholders entered into the joint venture to formally reduce to writing their desire to invest in and operate BioLite JP as a joint

The business of the joint venture shall be the research and development of drugs, medical device and digital media, investment,

fund running and consulting, distribution and marketing of supplements carried on by BioLite JP and its subsidiaries in Japan, or any

other territory or businesses as may from time to time be agreed by an amendment to the Agreement.

The closing of the transaction is conditioned

upon the approval and receipt of all necessary government approvals, which have been received.

Pursuant to the Agreement and the related share

transfer agreement, the Company shall transfer 54 of its Ordinary Shares to Lucidaim for no consideration, such that following the transfer,

Lucidaim shall own 1,555 Ordinary Shares (51%) and the Company shall own 1,494 Ordinary Shares (49%).

Also pursuant to the Agreement,

there shall be 3 directors of BioLite JP, consisting of 1 director appointed by the Company and 2 appointed by Lucidiam.

The Company shall

appoint Eugene Jiang, the Company’s current Chairman and Chief Business Officer and Lucidaim shall appoint Michihito Onishi;

current director of BioLite JP, Toru Seo (who is also a director of BioLite Japan’s other shareholder), is considered the second

Lucidaim director.

The Agreement further provides that the Company and BioLite JP shall assign the research collaboration and license

agreement between them to BioLite JP or prepare the same (the “ License Agreement ”).

The aforementioned transactions

occurred on the Completion Date.

As per the Agreement, the Shareholders shall supervise

and manage the business and operations of BioLite JP.

The directors shall not be entitled to any renumeration for their services as a

director and each Shareholder can remove and replace the director he/she/it appointed.

If a Shareholder sells or disposes of all of its

Ordinary Shares, the director such Shareholder appointed must tender his/her resignation.

The Agreement also sets forth certain corporate

actions that must be pre-approved by all Shareholders (the “ Reserved Matters ”).

If the Shareholders are unable to make

a decision on any Reserved Matter, then either Shareholder can submit a deadlock notice to the other shareholder, 5 days after which they

must refer the matter to each Shareholder’s chairman and use good faith to resolve the dispute.

If such dispute is not resolved

within 10 days thereafter, then either Shareholder can offer to buy all of the other Shareholder’s Ordinary Shares for cash at a

specified price;

if there is not affirmative acceptance of the sale, the sale shall proceed as set forth in the sale offer.

Each of the Shareholders maintains a pre-emptive

right to purchase such number of additional Ordinary Shares as would allow such Shareholder to maintain its ownership percentage in BioLite

JP if BioLite JP issues any new Ordinary Shares.

However, the Agreement provides that the Company shall lose its pre-emptive rights under

certain conditions.

The Shareholders also maintain a right of first refusal if the other Shareholder receives an offer to buy such shareholder’s

Ordinary Shares.

The Agreement also requires BioLite JP to obtain

a bank facility in the amount of JPY 30,460,000 (approximately USD272,000), for its initial working capital purposes.

Pursuant to the

Agreement, each Shareholder agrees to guarantee such bank facility if the bank requires a guarantee.

Accordingly, the Company may be liable

for the bank facility in an amount up to JPY 14,925,400 (approximately USD134,000), which represents 49% of the maximum bank facility.

The Agreement further provides that BioLite JP shall issue annual dividends at the rate of at least 1.5% of Biolite’s profits, if

it has sufficient cash to do so.

Pursuant to the Agreement, the Company and BioLite

JP agree to use their best efforts to execute the License Agreement by the end of December 2021.

The Company agreed that any negotiation

on behalf of BioLite JP regarding the terms of the License Agreement shall be handled by the directors appointed by Lucidaim.

If the Company

and such Lucidaim directors do not reach agreement on the terms, Biolite may at its sole discretion determine not to execute the License

Agreement without any liability to the Company.

The Agreement contains non-solicitation and non-compete

clauses for a period of 2 years after a Shareholder or its subsidiaries ceases to be a Shareholder, with such restrictive covenants limited

to business within the ophthalmologic filed or central neurological field.

Any rights to intellectual property that arise from Biolite’s

activities, shall belong to BioLite JP.

The Agreement contains standard indemnification

terms, except that no indemnifying party shall have any liability for an individual liability unless it exceeds JPY 500,000 (approximately

USD4,500) and until the aggregate amount of all liabilities exceeds JPY 2,000,000 (approximately USD18,000) and then only to the extent

such liability exceed such limit.

The Company paid $150,000 towards the setup of

the joint venture;

BioLite Japan’s other shareholder also paid $150,000 after the Letter of Intent was signed.

The Agreement shall continue for 10 years, unless

earlier terminated.

The Agreement also allows a Shareholder to terminate the agreement upon certain defaults committed by another Shareholder,

as set forth in the Agreement.

This was a related party transaction.

In November 2021, the Company received $4,244,452

in gross proceeds from the exercise of warrants issued in the Company’s August 3, 2021, public offering of securities.

exercised a total of 673,405 Series A warrants at a price of $6.30 per share, and 200 Series B warrants at a price of $10 per share.

BioKey Revenues

In addition to collaborative agreements, ABVC

earns revenue through its wholly-owned BioKey subsidiary which provides a wide range of Contract Development & Manufacturing Organization

(“CDMO”) services including API characterization, pre-formulation studies, formulation development, analytical method development,

stability studies, IND/NDA/ANDA/510K submissions, and manufacturing clinical trial materials (from Phase I through Phase III) and commercial

manufacturing of pharmaceutical products.

In addition, BioKey provides a variety of regulatory

services tailored to the needs of its customers, which include proofreading and regulatory review of submission documents related to formulation

development, clinical trials, marketed products, generics, nutraceuticals and OTC products and training presentations.

In addition to

supporting ABVC’s new drug development, BioKey submits INDs, NDAs, ANDAs, and DMFs to the FDA, on ABVC’s behalf in compliance

with new electronic submission guidelines of the FDA.

Impact of COVID-19 Outbreak

On January 30, 2020, the World Health Organization

declared the coronavirus outbreak a “Public Health Emergency of International Concern” and on March 10, 2020, declared it

to be a pandemic.

Actions taken around the world to help mitigate the spread of the coronavirus include restrictions on travel, and quarantines

in certain areas, and forced closures for certain types of public places and businesses.

The coronavirus and actions taken to mitigate

it have had and are expected to continue to have an adverse impact on the economies and financial markets of many countries, including

the geographical area in which the Company operates.

While the closures and limitations on movement, domestically and internationally,

are expected to be temporary, if the outbreak continues on its current trajectory the duration of the supply chain disruption could reduce

the availability, or result in delays, of materials or supplies to and from the Company, which in turn could materially interrupt the

Company’s business operations.

Given the speed and frequency of the continuously evolving developments with respect to this pandemic,

the Company cannot reasonably estimate the magnitude of the impact to its consolidated results of operations.

We have taken every precaution

possible to ensure the safety of our employees.

The COVID-19 pandemic, including variants, has

adversely affected, and is expected to continue to adversely affect, elements of our CDMO business sector.

The COVID-19 pandemic government

imposed restrictions constrained researcher access to labs globally.

These constraints limited scientific discovery capacity and we observed

that demand in those labs fell well below historic levels.

As constraints on social distancing were gradually lifted around the world

recently, labs have been able to increase research activity.

While we believe that underlying demand is still not yet at pre-COVID-19

levels since lab operations remain below their normal capacity, we are hopeful that the vaccination programs that are underway combined

with policy changes planned for the summer will further increase research activity and support a return to pre-COVID-19 demand levels

The global pandemic of COVID-19 continues to evolve

rapidly, and we will continue to monitor the situation closely, including its potential effect on our plans and timelines.

Additionally, it is reasonably possible that estimates

made in the financial statements have been, or will be, materially and adversely impacted in the near term as a result of these conditions,

including losses on inventory;

impairment losses related to goodwill and other long-lived assets and current obligations.

Summary of Critical Accounting Policies

Basis of Presentation

The accompanying unaudited consolidated financial

statements have been prepared in accordance with the generally accepted accounting principles in the United States of America (the “U.S.

All significant intercompany transactions and account balances have been eliminated.

This basis of accounting involves the application

of accrual accounting and consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred.

Co-Development

agreement with BioLite Japan K.K.

October 6, 2021 (the “ Completion Date ”), the Company, Lucidaim Co., Ltd., a Japanese corporation (“ Lucidaim ,”

together with the Company, the “ Shareholders ”), and BioLite Japan K.K., a Japanese corporation (“ BioLite

JP” ) entered into a Joint Venture Agreement (the “ Agreement ”).

BioLite JP is a private limited company (a

Japanese Kabushiki Kaisha ) incorporated on December 18, 2018 and at the date of the Agreement has 10,000 ordinary shares

authorized, with 3,049 ordinary shares issued and outstanding (the “ Ordinary Shares ”).

Immediately prior to the execution

of the Agreement, Lucidaim owned 1,501 ordinary shares and the Company owned the 1,548 ordinary shares.

The Shareholders entered into

the joint venture to formally reduce to writing their desire to invest in and operate BioLite JP as a joint venture.

The business of

the joint venture shall be the research and development of drugs, medical device and digital media, investment, fund running and consulting,

distribution and marketing of supplements carried on by BioLite JP and its subsidiaries in Japan, or any other territory or businesses

as may from time to time be agreed by an amendment to the Agreement.

The closing of the transaction is conditioned upon the approval

and receipt of all necessary government approvals, which have been received.

to the Agreement and the related share transfer agreement, the Company shall transfer 54 of its Ordinary Shares to Lucidaim for no consideration,

such that following the transfer, Lucidaim shall own 1,555 Ordinary Shares (51%) and the Company shall own 1,494 Ordinary Shares (49%).

Also pursuant to the Agreement, there shall be 3 directors of BioLite JP, consisting of 1 director appointed by the Company and 2 appointed

The Company shall appoint Eugene Jiang, the Company’s current Chairman and Chief Business Officer and Lucidaim shall

appoint Michihito Onishi;

the current director of BioLite JP, Toru Seo (who is also a director of BioLite Japan’s other shareholder),

is considered the second Lucidaim director.

The Agreement further provides that the Company and BioLite JP shall assign the research

collaboration and license agreement between them to BioLite JP or prepare the same (the “ License Agreement ”).

aforementioned transactions occurred on the Completion Date.

per the Agreement, the Shareholders shall supervise and manage the business and operations of BioLite JP.

The directors shall not be

entitled to any renumeration for their services as a director and each Shareholder can remove and replace the director he/she/it appointed.

If a Shareholder sells or disposes of all of its Ordinary Shares, the director such Shareholder appointed must tender his/her resignation.

The Agreement also sets forth certain corporate actions that must be pre-approved by all Shareholders (the “ Reserved Matters ”).

If the Shareholders are unable to make a decision on any Reserved Matter, then either Shareholder can submit a deadlock notice to the

other shareholder, 5 days after which they must refer the matter to each Shareholder’s chairman and use good faith to resolve the

If such dispute is not resolved within 10 days thereafter, then either Shareholder can offer to buy all of the other Shareholder’s

Ordinary Shares for cash at a specified price;

if there is not affirmative acceptance of the sale, the sale shall proceed as set forth

in the sale offer.

of the Shareholders maintains a pre-emptive right to purchase such number of additional Ordinary Shares as would allow such Shareholder

to maintain its ownership percentage in BioLite JP if BioLite JP issues any new Ordinary Shares.

However, the Agreement provides that

the Company shall lose its pre-emptive rights under certain conditions.

The Shareholders also maintain a right of first refusal if the

other Shareholder receives an offer to buy such shareholder’s Ordinary Shares.

Agreement also requires BioLite JP to obtain a bank facility in the amount of JPY 30,460,000 (approximately USD272,000), for its initial

working capital purposes.

Pursuant to the Agreement, each Shareholder agrees to guarantee such bank facility if the bank requires a guarantee.

Accordingly, the Company may be liable for the bank facility in an amount up to JPY 14,925,400 (approximately USD134,000), which represents

49% of the maximum bank facility.

The Agreement further provides that BioLite JP shall issue annual dividends at the rate of at least

1.5% of Biolite’s profits, if it has sufficient cash to do so.

to the Agreement, the Company and BioLite JP agree to use their best efforts to execute the License Agreement by the end of December

The Company agreed that any negotiation on behalf of BioLite JP regarding the terms of the License Agreement shall be handled by

the directors appointed by Lucidaim.

If the Company and such Lucidaim directors do not reach agreement on the terms, Biolite may at its

sole discretion determine not to execute the License Agreement without any liability to the Company.

Agreement contains non-solicitation and non-compete clauses for a period of 2 years after a Shareholder or its subsidiaries ceases to

be a Shareholder, with such restrictive covenants limited to business within the ophthalmologic filed or central neurological field.

Any rights to intellectual property that arise from Biolite’s activities, shall belong to BioLite JP.

Agreement contains standard indemnification terms, except that no indemnifying party shall have any liability for an individual liability

unless it exceeds JPY 500,000 (approximately USD4,500) and until the aggregate amount of all liabilities exceeds JPY 2,000,000 (approximately

USD18,000) and then only to the extent such liability exceed such limit.

Company paid $150,000 towards the setup of the joint venture;

BioLite Japan’s other shareholder also paid $150,000 after the Letter

of Intent was signed.

Agreement shall continue for 10 years, unless earlier terminated.

The Agreement also allows a Shareholder to terminate the agreement

upon certain defaults committed by another Shareholder, as set forth in the Agreement.

was a related party transaction.

November 2021, the Company received $4,244,452 in gross proceeds from the exercise of warrants issued in the Company’s August 3,

2021, public offering of securities.

Investors exercised a total of 673,405 Series A warrants at a price of $6.30 per share, and 200

Series B warrants at a price of $10 per share.

addition to collaborative agreements, ABVC earns revenue through its wholly-owned BioKey subsidiary which provides a wide range of Contract

Development & Manufacturing Organization (“CDMO”) services including API characterization, pre-formulation studies, formulation

development, analytical method development, stability studies, IND/NDA/ANDA/510K submissions, and manufacturing clinical trial materials

(from Phase I through Phase III) and commercial manufacturing of pharmaceutical products.

addition, BioKey provides a variety of regulatory services tailored to the needs of its customers, which include proofreading and regulatory

review of submission documents related to formulation development, clinical trials, marketed products, generics, nutraceuticals and OTC

products and training presentations.

In addition to supporting ABVC’s new drug development, BioKey submits INDs, NDAs, ANDAs, and

DMFs to the FDA, on ABVC’s behalf in compliance with new electronic submission guidelines of the FDA.

Impact of COVID-19

January 30, 2020, the World Health Organization declared the coronavirus outbreak a “Public Health Emergency of International Concern”

and on March 10, 2020, declared it to be a pandemic.

Actions taken around the world to help mitigate the spread of the coronavirus include

restrictions on travel, and quarantines in certain areas, and forced closures for certain types of public places and businesses.

coronavirus and actions taken to mitigate it have had and are expected to continue to have an adverse impact on the economies and financial

markets of many countries, including the geographical area in which the Company operates.

While the closures and limitations on movement,

domestically and internationally, are expected to be temporary, if the outbreak continues on its current trajectory the duration of the

supply chain disruption could reduce the availability, or result in delays, of materials or supplies to and from the Company, which in

turn could materially interrupt the Company’s business operations.

Given the speed and frequency of the continuously evolving developments

with respect to this pandemic, the Company cannot reasonably estimate the magnitude of the impact to its consolidated results of operations.

We have taken every precaution possible to ensure the safety of our employees.

COVID-19 pandemic, including variants, has adversely affected, and is expected to continue to adversely affect, elements of our CDMO

business sector.

The COVID-19 pandemic government imposed restrictions constrained researcher access to labs globally.

These constraints

limited scientific discovery capacity and we observed that demand in those labs fell well below historic levels.

As constraints on social

distancing were gradually lifted around the world recently, labs have been able to increase research activity.

While we believe that

underlying demand is still not yet at pre-COVID-19 levels since lab operations remain below their normal capacity, we are hopeful that

the vaccination programs that are underway combined with policy changes planned for the summer will further increase research activity

and support a return to pre-COVID-19 demand levels worldwide.

global pandemic of COVID-19 continues to evolve rapidly, and we will continue to monitor the situation closely, including its potential

effect on our plans and timelines.

Additionally,

it is reasonably possible that estimates made in the financial statements have been, or will be, materially and adversely impacted in

the near term as a result of these conditions, including losses on inventory;

impairment losses related to goodwill and other long-lived

assets and current obligations.

of Critical Accounting Policies

of Presentation

accompanying unaudited consolidated financial statements have been prepared in accordance with the generally accepted accounting principles

in the United States of America (the “U.S.

All significant intercompany transactions and account balances have been

basis of accounting involves the application of accrual accounting and consequently, revenues and gains are recognized when earned, and

expenses and losses are recognized when incurred.

The Company’s financial statements are expressed in U.S.

Reclassifications of Prior Year Presentation

Certain prior year unaudited consolidated balance

sheet and unaudited consolidated cash flow statement amounts have been reclassified for consistency with the current year presentation.

Reclassifications

of Prior Year Presentation

prior year unaudited consolidated balance sheet and unaudited consolidated cash flow statement amounts have been reclassified for consistency

with the current year presentation.

These reclassifications had no effect on the reported results of operations.

Use of Estimates

The preparation of financial statements in conformity

with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that

affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited

consolidated financial statements and the amount of revenues and expenses during the reporting periods.

Actual results could differ materially

from those results.

preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires

management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent

assets and liabilities at the date of the unaudited consolidated financial statements and the amount of revenues and expenses during

the reporting periods.

Actual results could differ materially from those results.

Reverse Split

On March 12, 2019, the Board of Directors of the

Company by unanimous written consent in lieu of a meeting approved to i) effect a stock reverse split at the ratio of 1-for-18 (the “Reverse

Split”) of both the authorized common stock of the Company (the “Common Stock”) and the issued and outstanding Common

Stock and ii) to amend the articles of incorporation of the Company to reflect the Reverse Split.

The Board approved and authorized the

Reverse Split without obtaining approval of the Company’s shareholders pursuant to Section 78.207 of Nevada Revised Statutes.

May 3, 2019, the Company filed a certificate of amendment to the Company’s articles of incorporation (the “Amendment”)

to effect the Reverse Split with the Secretary of State of Nevada.

The Financial Industry Regulatory Authority (“FINRA”) informed

the Company that the Reverse Split was effective on May 8, 2019.

On July 25, 2023, the Company filed a Certificate

of Amendment to its Articles of Incorporation authorizing a 1-for-10 reverse stock split of the issued and outstanding shares of its common

The Company’s stockholders previously approved the Reverse Stock Split at the Company’s Special Shareholder Meeting

held on July 7, 2023.

The Reverse Stock Split was effected to reduce the number of issued and outstanding shares and to increase the per

share trading value of the Company’s common stock, although that outcome is not guaranteed.

In turn, the Company believes that the

Reverse Stock Split will enable the Company to restore compliance with certain continued listing standards of NASDAQ Capital Market.

shares and related financial information in this report reflect this 1-for-10 reverse stock split.

On July 14, 2023, the Company filed

a certificate of amendment to the Company’s articles of incorporation (the “Amendment”) to implement the 2023 Split

with the Secretary of State of the State of Nevada.

The 2023 Split took effect on July 25, 2023.

Fair Value Measurements

FASB ASC 820, “Fair Value Measurements”

defines fair value for certain financial and nonfinancial assets and liabilities that are recorded at fair value, establishes a framework

for measuring fair value and expands disclosures about fair value measurements.

It requires that an entity measure its financial instruments

to base fair value on exit price, maximize the use of observable units and minimize the use of unobservable inputs to determine the exit

It establishes a hierarchy which prioritizes the inputs to valuation techniques used to measure fair value.

This hierarchy increases

the consistency and comparability of fair value measurements and related disclosures by maximizing the use of observable inputs and minimizing

the use of unobservable inputs by requiring that observable inputs be used when available.

Observable inputs are inputs that reflect the

assumptions market participants would use in pricing the assets or liabilities based on market data obtained from sources independent

of the Company.

Unobservable inputs are inputs that reflect the Company’s own assumptions about the assumptions market participants

would use in pricing the asset or liability developed based on the best information available in the circumstances.

The hierarchy prioritizes

the inputs into three broad levels based on the reliability of the inputs as follows:

1 - Inputs are quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the

measurement date.

Valuation of these instruments does not require a high degree of judgment as the valuations are based on quoted prices

in active markets that are readily and regularly available.

2 - Inputs other than quoted prices in active markets that are either directly or indirectly observable as of the measurement date, such

as quoted prices for similar assets or liabilities;

March 12, 2019, the Board of Directors of the Company by unanimous written consent in lieu of a meeting approved to i) effect a stock

reverse split at the ratio of 1-for-18 (the “Reverse Split”) of both the authorized common stock of the Company (the “Common

Stock”) and the issued and outstanding Common Stock and ii) to amend the articles of incorporation of the Company to reflect the

Reverse Split.

The Board approved and authorized the Reverse Split without obtaining approval of the Company’s shareholders pursuant

to Section 78.207 of Nevada Revised Statutes.

On May 3, 2019, the Company filed a certificate of amendment to the Company’s articles

of incorporation (the “Amendment”) to effect the Reverse Split with the Secretary of State of Nevada.

The Financial Industry

Regulatory Authority (“FINRA”) informed the Company that the Reverse Split was effective on May 8, 2019.

July 25, 2023, the Company filed a Certificate of Amendment to its Articles of Incorporation authorizing a 1-for-10 reverse stock split

of the issued and outstanding shares of its common stock.

The Company’s stockholders previously approved the Reverse Stock Split

at the Company’s Special Shareholder Meeting held on July 7, 2023.

The Reverse Stock Split was effected to reduce the number of

issued and outstanding shares and to increase the per share trading value of the Company’s common stock, although that outcome

is not guaranteed.

In turn, the Company believes that the Reverse Stock Split will enable the Company to restore compliance with certain

continued listing standards of NASDAQ Capital Market.

All shares and related financial information in this report reflect this 1-for-10

reverse stock split.

On July 14, 2023, the Company filed a certificate of amendment to the Company’s articles of incorporation

(the “Amendment”) to implement the 2023 Split with the Secretary of State of the State of Nevada.

The 2023 Split took effect

on July 25, 2023.

Value Measurements

ASC 820, “Fair Value Measurements” defines fair value for certain financial and nonfinancial assets and liabilities that

are recorded at fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements.

requires that an entity measure its financial instruments to base fair value on exit price, maximize the use of observable units and

minimize the use of unobservable inputs to determine the exit price.

It establishes a hierarchy which prioritizes the inputs to valuation

techniques used to measure fair value.

This hierarchy increases the consistency and comparability of fair value measurements and related

disclosures by maximizing the use of observable inputs and minimizing the use of unobservable inputs by requiring that observable inputs

be used when available.

Observable inputs are inputs that reflect the assumptions market participants would use in pricing the assets

or liabilities based on market data obtained from sources independent of the Company.

Unobservable inputs are inputs that reflect the

Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based

on the best information available in the circumstances.

The hierarchy prioritizes the inputs into three broad levels based on the reliability

of the inputs as follows:

1 - Inputs are quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at

the measurement date.

Valuation of these instruments does not require a high degree of judgment as the valuations are based on quoted

prices in active markets that are readily and regularly available.

2 - Inputs other than quoted prices in active markets that are either directly or indirectly observable as of the measurement date,

such as quoted prices for similar assets or liabilities;

quoted prices in markets that are not active;

5 unchanged sentences

a market participant would use in pricing the asset or liability.

The carrying values of certain assets and liabilities

of the Company, such as cash and cash equivalents, restricted cash, accounts receivable, due from related parties, inventory, prepaid

expenses and other current assets, accounts payable, accrued liabilities, and due to related parties approximate fair value due to their

relatively short maturities.

The carrying value of the Company’s short-term bank loan, convertible notes payable, and accrued interest

approximates their fair value as the terms of the borrowing are consistent with current market rates and the duration to maturity is short.

The carrying value of the Company’s long-term bank loan approximates fair value because the interest rates approximate market rates

that the Company could obtain for debt with similar terms and maturities.

Cash and Cash Equivalents

The Company considers highly liquid investments

with maturities of three months or less, when purchased, to be cash equivalents.

As of June 30, 2023 and December 31, 2022, the Company’s

cash and cash equivalents amounted to $99,290 and $85,265, respectively.

Some of the Company’s cash deposits are held in financial

institutions located in Taiwan where there is currently regulation mandated on obligatory insurance of bank accounts.

The Company believes

this financial institution is of high credit quality.

Restricted Cash Equivalents

Restricted cash equivalents primarily consist

of cash held in a reserve bank account in Taiwan.

As of June 30, 2023 and December 31, 2022, the Company’s restricted cash equivalents

amounted to $642,899 and $1,306,463, respectively.

Concentration of Credit Risk

The Company’s financial instruments that

are exposed to concentrations of credit risk consist primarily of cash and cash equivalents.

The Company places its cash and temporary

cash investments in high quality credit institutions, but these investments may be in excess of Taiwan Central Deposit Insurance Corporation

carrying values of certain assets and liabilities of the Company, such as cash and cash equivalents, restricted cash, accounts receivable,

due from related parties, inventory, prepaid expenses and other current assets, accounts payable, accrued liabilities, and due to related

parties approximate fair value due to their relatively short maturities.

The carrying value of the Company’s short-term bank loan,

convertible notes payable, and accrued interest approximates their fair value as the terms of the borrowing are consistent with current

market rates and the duration to maturity is short.

The carrying value of the Company’s long-term bank loan approximates fair value

because the interest rates approximate market rates that the Company could obtain for debt with similar terms and maturities.

and Cash Equivalents

Company considers highly liquid investments with maturities of three months or less, when purchased, to be cash equivalents.

As of September

30, 2023 and December 31, 2022, the Company’s cash and cash equivalents amounted to $500,069 and $85,265, respectively.

the Company’s cash deposits are held in financial institutions located in Taiwan where there is currently regulation mandated on

obligatory insurance of bank accounts.

The Company believes this financial institution is of high credit quality.

Restricted Cash

Restricted cash primarily consist of certificate of

deposits as a collateral of short-term loan held in CTBC Bank.

As of September 30, 2023 and December 31, 2022, the Company’s restricted

cash amounted to $620,868 and $1,306,463, respectively.

Concentration

of Credit Risk

Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents.

The Company places its cash and temporary cash investments in high quality credit institutions, but these investments may be in excess

of Taiwan Central Deposit Insurance Corporation and the U.S.

Federal Deposit Insurance Corporation’s insurance limits.

The Company does not enter into financial instruments for

hedging, trading or speculative purposes.

We perform ongoing credit evaluation of our customers

and requires no collateral.

An allowance for doubtful accounts is provided based on a review of the collectability of accounts receivable.

We determine the amount of allowance for doubtful accounts by examining its historical collection experience and current trends in the

credit quality of its customers as well as its internal credit policies.

Actual credit losses may differ from our estimates.

Concentration of clients

As of June 30, 2023,

the most major client, who specializes in developing and commercializing dietary supplements and therapeutics in the dietary supplement

industry, accounted for 97.28% of the Company’s total account receivables.

As of December 31, 2022, the most major client, who specializes

in developing and commercializing dietary supplements and therapeutics in the dietary supplement industry, accounted for 71.89% of the

Company’s total account receivable;

the second major client, with its Chairman also having a position as one of the Board of Directors

of BioKey, accounted for 16.62% of the Company’s total account receivable

For the six months ended

June 30, 2023, two major clients, manufacturing drugs, dietary supplements, and medical products, accounted for 43.64% and 34.75% of the

Company’s total revenues.

For the six months ended June 30, 2022, two major clients, which develops novel treatment for ocular Graft-versus-Host

Disease as well as providing biotechnical research, accounted for 48.90% and 20.48% of the Company’s total revenues, respectively.

Revenue Recognition

During the fiscal year 2018, the Company adopted

Accounting Standards Codification (“ASC”), Topic 606 (ASC 606), Revenue from Contracts with Customers, using the modified

retrospective method to all contracts that were not completed as of January 1, 2018, and applying the new revenue standard as an adjustment

to the opening balance of accumulated deficit at the beginning of 2018 for the cumulative effect.

The results for the Company’s

reporting periods beginning on and after January 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and

continue to be reported under the accounting standards in effect for the prior period.

Based on the Company’s review of existing

collaborative agreements as of January 1, 2018, the Company concluded that the adoption of the new guidance did not have a significant

change on the Company’s revenue during all periods presented.

Pursuant to ASC 606, the Company recognizes revenue

when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the Company expects

to receive in exchange for those goods or services.

To determine revenue recognition for arrangements that the Company determines is

within the scope of ASC 606, the Company performs the following five steps:

(i) identify the contract(s) with a customer;

(ii) identify

the performance obligations in the contract;

does not enter into financial instruments for hedging, trading or speculative purposes.

perform ongoing credit evaluation of our customers and requires no collateral.

An allowance for doubtful accounts is provided based on

a review of the collectability of accounts receivable.

We determine the amount of allowance for doubtful accounts by examining its historical

collection experience and current trends in the credit quality of its customers as well as its internal credit policies.

Actual credit

losses may differ from our estimates.

Concentration

of September 30, 2023, the most major client, who specializes in developing and commercializing dietary supplements and therapeutics

in the dietary supplement industry, accounted for 99.76% of the Company’s total account receivables.

As of December 31, 2022, the

most major client, who specializes in developing and commercializing dietary supplements and therapeutics in the dietary supplement industry,

accounted for 71.89% of the Company’s total account receivable;

the second major client, with its Chairman also having a position

as one of the Board of Directors of BioKey, accounted for 16.62% of the Company’s total account receivable

the nine months ended September 30, 2023, the most major client, manufacturing drugs, dietary supplements, and medical products,

accounted for 81.19% of the Company’s total revenues.

For the nine months ended September 30, 2022, one major client, who

is a Shareholder of the Company that works in development and commercialization of new drugs in Taiwan, accounted for 79.18% of the Company’s

total revenues.

Accounts receivable and allowance for expected

credit losses accounts

Accounts receivable is recorded and carried at the original invoiced

amount less an allowance for any potential uncollectible amounts.

The Company make estimates of expected credit and collectability trends

for the allowance for credit losses and allowance for unbilled receivables based upon our assessment of various factors, including historical

experience, the age of the accounts receivable balances, credit quality of customers, current economic conditions reasonable and supportable

forecasts of future economic conditions, and other factors that may affect our ability to collect from customers.

The provision is recorded

against accounts receivable balances, with a corresponding charge recorded in the consolidated statements of income.

Actual amounts received

may differ from management’s estimate of credit worthiness and the economic environment.

Delinquent account balances are written-off

against the allowance for doubtful accounts after management has determined that the likelihood of collection is not probable.

Allowance for expected credit losses accounts was 113,694 and 194,957

as of September 30, 2023 and December 31, 2022, respectively.

the fiscal year 2018, the Company adopted Accounting Standards Codification (“ASC”), Topic 606 (ASC 606), Revenue from Contracts

with Customers, using the modified retrospective method to all contracts that were not completed as of January 1, 2018, and applying

the new revenue standard as an adjustment to the opening balance of accumulated deficit at the beginning of 2018 for the cumulative effect.

The results for the Company’s reporting periods beginning on and after January 1, 2018 are presented under ASC 606, while prior

period amounts are not adjusted and continue to be reported under the accounting standards in effect for the prior period.

Company’s review of existing collaborative agreements as of January 1, 2018, the Company concluded that the adoption of the new

guidance did not have a significant change on the Company’s revenue during all periods presented.

to ASC 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects

the consideration that the Company expects to receive in exchange for those goods or services.

To determine revenue recognition for arrangements

that the Company determines is within the scope of ASC 606, the Company performs the following five steps:

(i) identify the contract(s)

with a customer;

(ii) identify the performance obligations in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction price to the performance

obligations in the contract;

and (v) recognize revenue when (or as) the Company satisfies a performance obligation.

The Company only

applies the five-step model to contracts when it is probable that the Company will collect the consideration the Company is entitled

to in exchange for the goods or services the Company transfers to the customers.

At inception of the contract, once the contract is determined

to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract, determines those that are

performance obligations, and assesses whether each promised good or service is distinct.

The Company then recognizes as revenue the amount

of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The following are examples

of when the Company recognizes revenue based on the types of payments the Company receives.

Collaborative Revenues

— The Company recognizes collaborative revenues generated through collaborative research, development and/or commercialization

(iv) allocate the

transaction price to the performance obligations in the contract;

and (v) recognize revenue when (or as) the Company satisfies a performance

The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration

the Company is entitled to in exchange for the goods or services the Company transfers to the customers.

At inception of the contract,

once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract,

determines those that are performance obligations, and assesses whether each promised good or service is distinct.

The Company then recognizes

as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance

obligation is satisfied.

following are examples of when the Company recognizes revenue based on the types of payments the Company receives.

Collaborative

Revenues — The Company recognizes collaborative revenues generated through collaborative research, development and/or

commercialization agreements.

The terms of these agreements typically include payment to the Company related to one or more of the following:

non-refundable

upfront license fees, development and commercial milestones, partial or complete reimbursement of research and development costs, and

royalties on net sales of licensed products.

Each type of payments results in collaborative revenues except for revenues from royalties

on net sales of licensed products, which are classified as royalty revenues.

To date, the Company has not received any royalty revenues.

non-refundable upfront license fees, development and commercial milestones, partial or complete reimbursement of research and development

costs, and royalties on net sales of licensed products.

Each type of payments results in collaborative revenues except for revenues from

royalties on net sales of licensed products, which are classified as royalty revenues.

To date, the Company has not received any royalty

Revenue is recognized upon satisfaction of a performance obligation by transferring control of a good or service to the collaboration

As part of the accounting

for these arrangements, the Company applies judgment to determine whether the performance obligations are distinct, and develop assumptions

in determining the stand-alone selling price for each distinct performance obligation identified in the collaboration agreements.

determine the stand-alone selling price, the Company relies on assumptions which may include forecasted revenues, development timelines,

reimbursement rates for R&D personnel costs, discount rates and probabilities of technical and regulatory success.

The Company had multiple

deliverables under the collaborative agreements, including deliverables relating to grants of technology licenses, regulatory and clinical

development, and marketing activities.

Estimation of the performance periods of the Company’s deliverables requires the use of

management’s judgment.

Significant factors considered in management’s evaluation of the estimated performance periods include,

but are not limited to, the Company’s experience in conducting clinical development, regulatory and manufacturing activities.

Company reviews the estimated duration of its performance periods under its collaborative agreements on an annually basis, and makes

any appropriate adjustments on a prospective basis.

Future changes in estimates of the performance period under its collaborative agreements

could impact the timing of future revenue recognition.

(i) Non-refundable upfront payments

If a license to the

Company’s intellectual property is determined to be distinct from the other performance obligations identified in an arrangement,

the Company recognizes revenue from the related non-refundable upfront payments based on the relative standalone selling price prescribed

to the license compared to the total selling price of the arrangement.

The revenue is recognized when the license is transferred to the

collaboration partners and the collaboration partners are able to use and benefit from the license.

To date, the receipt of non-refundable

upfront fees was solely for the compensation of past research efforts and contributions made by the Company before the collaborative

agreements entered into and it does not relate to any future obligations and commitments made between the Company and the collaboration

partners in the collaborative agreements.

(ii) Milestone payments

The Company is eligible

to receive milestone payments under the collaborative agreement with collaboration partners based on achievement of specified development,

regulatory and commercial events.

Management evaluated the nature of the events triggering these contingent payments, and concluded that

these events fall into two categories:

(a) events which involve the performance of the Company’s obligations under the collaborative

agreement with collaboration partners, and (b) events which do not involve the performance of the Company’s obligations under the

collaborative agreement with collaboration partners.

The former category

of milestone payments consists of those triggered by development and regulatory activities in the territories specified in the collaborative

part of the accounting for these arrangements, the Company applies judgment to determine whether the performance obligations are distinct,

and develop assumptions in determining the stand-alone selling price for each distinct performance obligation identified in the collaboration

To determine the stand-alone selling price, the Company relies on assumptions which may include forecasted revenues, development

timelines, reimbursement rates for R&D personnel costs, discount rates and probabilities of technical and regulatory success.

Company had multiple deliverables under the collaborative agreements, including deliverables relating to grants of technology licenses,

regulatory and clinical development, and marketing activities.

Estimation of the performance periods of the Company’s deliverables

requires the use of management’s judgment.

Significant factors considered in management’s evaluation of the estimated performance

periods include, but are not limited to, the Company’s experience in conducting clinical development, regulatory and manufacturing

The Company reviews the estimated duration of its performance periods under its collaborative agreements on an annually basis,

and makes any appropriate adjustments on a prospective basis.

Future changes in estimates of the performance period under its collaborative

agreements could impact the timing of future revenue recognition.

(i) Non-refundable upfront

a license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified

in an arrangement, the Company recognizes revenue from the related non-refundable upfront payments based on the relative standalone selling

price prescribed to the license compared to the total selling price of the arrangement.

The revenue is recognized when the license is

transferred to the collaboration partners and the collaboration partners are able to use and benefit from the license.

To date, the receipt

of non-refundable upfront fees was solely for the compensation of past research efforts and contributions made by the Company before

the collaborative agreements entered into and it does not relate to any future obligations and commitments made between the Company and

the collaboration partners in the collaborative agreements.

Milestone payments

Company is eligible to receive milestone payments under the collaborative agreement with collaboration partners based on achievement

of specified development, regulatory and commercial events.

Management evaluated the nature of the events triggering these contingent

payments, and concluded that these events fall into two categories:

(a) events which involve the performance of the Company’s obligations

under the collaborative agreement with collaboration partners, and (b) events which do not involve the performance of the Company’s

obligations under the collaborative agreement with collaboration partners.

former category of milestone payments consists of those triggered by development and regulatory activities in the territories specified

in the collaborative agreements.

Management concluded that each of these payments constitute substantive milestone payments.

This conclusion was based primarily

on the facts that (i) each triggering event represents a specific outcome that can be achieved only through successful performance by

the Company of one or more of its deliverables, (ii) achievement of each triggering event was subject to inherent risk and uncertainty

and would result in additional payments becoming due to the Company, (iii) each of the milestone payments is non-refundable, (iv) substantial

effort is required to complete each milestone, (v) the amount of each milestone payment is reasonable in relation to the value created

in achieving the milestone, (vi) a substantial amount of time is expected to pass between the upfront payment and the potential milestone

payments, and (vii) the milestone payments relate solely to past performance.

Based on the foregoing, the Company recognizes any revenue

from these milestone payments in the period in which the underlying triggering event occurs.

(iii) Multiple Element Arrangements

The Company evaluates

multiple element arrangements to determine (1) the deliverables included in the arrangement and (2) whether the individual deliverables

represent separate units of accounting or whether they must be accounted for as a combined unit of accounting.

This evaluation involves

subjective determinations and requires management to make judgments about the individual deliverables and whether such deliverables are

separate from other aspects of the contractual relationship.

This conclusion

was based primarily on the facts that (i) each triggering event represents a specific outcome that can be achieved only through successful

performance by the Company of one or more of its deliverables, (ii) achievement of each triggering event was subject to inherent risk

and uncertainty and would result in additional payments becoming due to the Company, (iii) each of the milestone payments is non-refundable,

(iv) substantial effort is required to complete each milestone, (v) the amount of each milestone payment is reasonable in relation to

the value created in achieving the milestone, (vi) a substantial amount of time is expected to pass between the upfront payment and the

potential milestone payments, and (vii) the milestone payments relate solely to past performance.

Based on the foregoing, the Company

recognizes any revenue from these milestone payments in the period in which the underlying triggering event occurs.

(iii) Multiple Element

Company evaluates multiple element arrangements to determine (1) the deliverables included in the arrangement and (2) whether the individual

deliverables represent separate units of accounting or whether they must be accounted for as a combined unit of accounting.

This evaluation

involves subjective determinations and requires management to make judgments about the individual deliverables and whether such deliverables

are separate from other aspects of the contractual relationship.

Deliverables are considered separate units of accounting provided that:

7 unchanged sentences

and whether there are other vendors that can provide the undelivered element(s).

The Company recognizes

arrangement consideration allocated to each unit of accounting when all of the revenue recognition criteria in ASC 606 are satisfied

for that particular unit of accounting.

In the event that a deliverable does not represent a separate unit of accounting, the Company

recognizes revenue from the combined unit of accounting over the Company’s contractual or estimated performance period for the

undelivered elements, which is typically the term of the Company’s research and development obligations.

If there is no discernible

pattern of performance or objectively measurable performance measures do not exist, then the Company recognizes revenue under the arrangement

on a straight-line basis over the period the Company is expected to complete its performance obligations.

Conversely, if the pattern

of performance in which the service is provided to the customer can be determined and objectively measurable performance measures exist,

then the Company recognizes revenue under the arrangement using the proportional performance method.

Revenue recognized is limited to

the lesser of the cumulative amount of payments received or the cumulative amount of revenue earned, as determined using the straight-line

method or proportional performance method, as applicable, as of the period ending date.

At the inception of

an arrangement that includes milestone payments, the Company evaluates whether each milestone is substantive and at risk to both parties

on the basis of the contingent nature of the milestone.

Company recognizes arrangement consideration allocated to each unit of accounting when all of the revenue recognition criteria in ASC

606 are satisfied for that particular unit of accounting.

In the event that a deliverable does not represent a separate unit of accounting,

the Company recognizes revenue from the combined unit of accounting over the Company’s contractual or estimated performance period

for the undelivered elements, which is typically the term of the Company’s research and development obligations.

If there is no

discernible pattern of performance or objectively measurable performance measures do not exist, then the Company recognizes revenue under

the arrangement on a straight-line basis over the period the Company is expected to complete its performance obligations.

if the pattern of performance in which the service is provided to the customer can be determined and objectively measurable performance

measures exist, then the Company recognizes revenue under the arrangement using the proportional performance method.

Revenue recognized

is limited to the lesser of the cumulative amount of payments received or the cumulative amount of revenue earned, as determined using

the straight-line method or proportional performance method, as applicable, as of the period ending date.

the inception of an arrangement that includes milestone payments, the Company evaluates whether each milestone is substantive and at

risk to both parties on the basis of the contingent nature of the milestone.

This evaluation includes an assessment of whether:

(1) the consideration is commensurate

with either the Company’s performance to achieve the milestone or the enhancement of the value of the delivered item(s) as a result

of a specific outcome resulting from its performance to achieve the milestone, (2) the consideration relates solely to past performance

and (3) the consideration is reasonable relative to all of the deliverables and payment terms within the arrangement.

The Company evaluates

factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to achieve the particular milestone

and the level of effort and investment required to achieve the particular milestone in making this assessment.

There is considerable

judgment involved in determining whether a milestone satisfies all of the criteria required to conclude that a milestone is substantive.

Milestones that are not considered substantive are recognized as earned if there are no remaining performance obligations or over the

remaining period of performance, assuming all other revenue recognition criteria are met.

(iv) Royalties and Profit Sharing Payments

Under the collaborative

agreement with the collaboration partners, the Company is entitled to receive royalties on sales of products, which is at certain percentage

of the net sales.

The Company recognizes revenue from these events based on the revenue recognition criteria set forth in ASC 606.

on those criteria, the Company considers these payments to be contingent revenues, and recognizes them as revenue in the period in which

the applicable contingency is resolved.

Revenues Derived from

Research and Development Activities Services — Revenues related to research and development and regulatory activities are recognized

when the related services or activities are performed, in accordance with the contract terms.

The Company typically has only one performance

obligation at the inception of a contract, which is to perform research and development services.

The Company may also provide its customers

with an option to request that the Company provides additional goods or services in the future, such as active pharmaceutical ingredient,

API, or IND/NDA/ANDA/510K submissions.

The Company evaluates whether these options are material rights at the inception of the contract.

If the Company determines an option is a material right, the Company will consider the option a separate performance obligation.

If the Company is entitled

to reimbursement from its customers for specified research and development expenses, the Company accounts for the related services that

it provides as separate performance obligations if it determines that these services represent a material right.

The Company also determines

whether the reimbursement of research and development expenses should be accounted for as revenues or an offset to research and development

expenses in accordance with provisions of gross or net revenue presentation.

The Company recognizes the corresponding revenues or records

the corresponding offset to research and development expenses as it satisfies the related performance obligations.

The Company then determines

the transaction price by reviewing the amount of consideration the Company is eligible to earn under the contracts, including any variable

consideration.

Under the outstanding contracts, consideration typically includes fixed consideration and variable consideration in the

form of potential milestone payments.

At the start of an agreement, the Company’s transaction price usually consists of the payments

made to or by the Company based on the number of full-time equivalent researchers assigned to the project and the related research and

development expenses incurred.

The Company does not typically include any payments that the Company may receive in the future in its

initial transaction price because the payments are not probable.

The Company would reassess the total transaction price at each reporting

period to determine if the Company should include additional payments in the transaction price.

The Company receives

payments from its customers based on billing schedules established in each contract.

Upfront payments and fees may be recorded as contract

liabilities upon receipt or when due, and may require deferral of revenue recognition to a future period until the Company performs its

obligations under these arrangements.

Amounts are recorded as accounts receivable when the right of the Company to consideration is unconditional.

The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such

that the period between payment by the customers and the transfer of the promised goods or services to the customers will be one year

Property and Equipment

Property and equipment is carried at cost net

of accumulated depreciation.

consideration is commensurate with either the Company’s performance to achieve the milestone or the enhancement of the value of

the delivered item(s) as a result of a specific outcome resulting from its performance to achieve the milestone, (2) the consideration

relates solely to past performance and (3) the consideration is reasonable relative to all of the deliverables and payment terms within

the arrangement.

The Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be

overcome to achieve the particular milestone and the level of effort and investment required to achieve the particular milestone in making

this assessment.

There is considerable judgment involved in determining whether a milestone satisfies all of the criteria required to

conclude that a milestone is substantive.

Milestones that are not considered substantive are recognized as earned if there are no remaining

performance obligations or over the remaining period of performance, assuming all other revenue recognition criteria are met.

(iv) Royalties and Profit

Sharing Payments

the collaborative agreement with the collaboration partners, the Company is entitled to receive royalties on sales of products, which

is at certain percentage of the net sales.

The Company recognizes revenue from these events based on the revenue recognition criteria

set forth in ASC 606.

Based on those criteria, the Company considers these payments to be contingent revenues, and recognizes them as

revenue in the period in which the applicable contingency is resolved.

Derived from Research and Development Activities Services — Revenues related to research and development and regulatory activities

are recognized when the related services or activities are performed, in accordance with the contract terms.

The Company typically has

only one performance obligation at the inception of a contract, which is to perform research and development services.

The Company may

also provide its customers with an option to request that the Company provides additional goods or services in the future, such as active

pharmaceutical ingredient, API, or IND/NDA/ANDA/510K submissions.

The Company evaluates whether these options are material rights at

the inception of the contract.

If the Company determines an option is a material right, the Company will consider the option a separate

performance obligation.

the Company is entitled to reimbursement from its customers for specified research and development expenses, the Company accounts for

the related services that it provides as separate performance obligations if it determines that these services represent a material right.

The Company also determines whether the reimbursement of research and development expenses should be accounted for as revenues or an

offset to research and development expenses in accordance with provisions of gross or net revenue presentation.

The Company recognizes

the corresponding revenues or records the corresponding offset to research and development expenses as it satisfies the related performance

Company then determines the transaction price by reviewing the amount of consideration the Company is eligible to earn under the contracts,

including any variable consideration.

Under the outstanding contracts, consideration typically includes fixed consideration and variable

consideration in the form of potential milestone payments.

At the start of an agreement, the Company’s transaction price usually

consists of the payments made to or by the Company based on the number of full-time equivalent researchers assigned to the project and

the related research and development expenses incurred.

The Company does not typically include any payments that the Company may receive

in the future in its initial transaction price because the payments are not probable.

The Company would reassess the total transaction

price at each reporting period to determine if the Company should include additional payments in the transaction price.

Company receives payments from its customers based on billing schedules established in each contract.

Upfront payments and fees may be

recorded as contract liabilities upon receipt or when due, and may require deferral of revenue recognition to a future period until the

Company performs its obligations under these arrangements.

Amounts are recorded as accounts receivable when the right of the Company

to consideration is unconditional.

The Company does not assess whether a contract has a significant financing component if the expectation

at contract inception is such that the period between payment by the customers and the transfer of the promised goods or services to

the customers will be one year or less.

and Equipment

and equipment is carried at cost net of accumulated depreciation.

Repairs and maintenance are expensed as incurred.

Expenditures that improve the functionality of the related

asset or extend the useful life are capitalized.

When property and equipment is retired or otherwise disposed of, the related gain or

loss is included in operating income.

Leasehold improvements are depreciated on the straight-line method over the shorter of the remaining

lease term or estimated useful life of the asset.

Depreciation is calculated on the straight-line method, including property and equipment

under capital leases, generally based on the following useful lives:

Buildings and leasehold

Machinery and equipment

Office equipment

Impairment of Long-Lived Assets

The Company has adopted Accounting Standards

Codification subtopic 360-10, Property, Plant and Equipment (“ASC 360-10”).

ASC 360-10 requires that long-lived assets and

certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances

indicate that the carrying amount of an asset may not be recoverable.

The Company evaluates its long-lived assets for impairment annually

or more often if events and circumstances warrant.

Events relating to recoverability may include significant unfavorable changes in business

conditions, recurring losses, or a forecasted inability to achieve break-even operating results over an extended period.

Should impairment

in value be indicated, the carrying value of intangible assets will be adjusted, based on estimates of future discounted cash flows resulting

from the use and ultimate disposition of the asset.

ASC 360-10 also requires assets to be disposed of be reported at the lower of the

carrying amount or the fair value less costs to sell.

Long-term Equity Investment

The Company acquires the equity investments to

promote business and strategic objectives.

The Company accounts for non-marketable equity and other equity investments for which the

Company does not have control over the investees as:

Equity method investments

when the Company has the ability to exercise significant influence, but not control, over the investee.

Its proportionate share of

the income or loss is recognized monthly and is recorded in gains (losses) on equity investments.

Non-marketable cost method

investments when the equity method does not apply.

Significant judgment is required to identify

whether an impairment exists in the valuation of the Company’s non-marketable equity investments, and therefore the Company considers

this a critical accounting estimate.

Its yearly analysis considers both qualitative and quantitative factors that may have a significant

impact on the investee’s fair value.

Qualitative analysis of its investments involves understanding the financial performance and

near-term prospects of the investee, changes in general market conditions in the investee’s industry or geographic area, and the

management and governance structure of the investee.

Quantitative assessments of the fair value of its investments are developed using

the market and income approaches.

The market approach includes the use of comparable financial metrics of private and public companies

and recent financing rounds.

The income approach includes the use of a discounted cash flow model, which requires significant estimates

regarding the investees’ revenue, costs, and discount rates.

The Company’s assessment of these factors in determining whether

an impairment exists could change in the future due to new developments or changes in applied assumptions.

Other-Than-Temporary Impairment

The Company’s long-term equity investments

are subject to a periodic impairment review.

Expenditures that

improve the functionality of the related asset or extend the useful life are capitalized.

When property and equipment is retired or otherwise

disposed of, the related gain or loss is included in operating income.

Leasehold improvements are depreciated on the straight-line method

over the shorter of the remaining lease term or estimated useful life of the asset.

Depreciation is calculated on the straight-line method,

including property and equipment under capital leases, generally based on the following useful lives:

and leasehold improvements

and equipment

Construction-in-Progress

The Company acquires constructions that constructs

certain of its fixed assets.

All direct and indirect costs that are related to the construction of fixed assets and incurred before the

assets are ready for their intended use are capitalized as construction-in-progress.

No depreciation is provided in respect of construction-in-progress.

Construction in progress is transferred to specific fixed asset items and depreciation of these assets commences when they are ready for

their intended use.

The Company acquired 20% of the ownership of a certain property and parcel of land owned by Zhonghui, with a view

to jointly develop the property into a healthcare center for senior living, long-term care, and medical care in the areas of ABVC’s

special interests, such as Ophthalmology, Oncology, and Central Nervous Systems.

The plan is to establish a base for the China market

and global development of these interests.

The Company is a party to a related cooperation agreement with Zhonghui, but is awaiting final

asset ownership certification from the Chinese government.

of Long-Lived Assets

Company has adopted Accounting Standards Codification subtopic 360-10, Property, Plant and Equipment (“ASC 360-10”).

360-10 requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever

events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

The Company evaluates its long-lived

assets for impairment annually or more often if events and circumstances warrant.

Events relating to recoverability may include significant

unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve break-even operating results over

an extended period.

Should impairment in value be indicated, the carrying value of intangible assets will be adjusted, based on estimates

of future discounted cash flows resulting from the use and ultimate disposition of the asset.

ASC 360-10 also requires assets to be disposed

of be reported at the lower of the carrying amount or the fair value less costs to sell.

Equity Investment

Company acquires the equity investments to promote business and strategic objectives.

The Company accounts for non-marketable equity

and other equity investments for which the Company does not have control over the investees as:

method investments when the Company has the ability to exercise significant influence, but not control, over the investee.

Its proportionate

share of the income or loss is recognized monthly and is recorded in gains (losses) on equity investments.

Non-marketable

cost method investments when the equity method does not apply.

judgment is required to identify whether an impairment exists in the valuation of the Company’s non-marketable equity investments,

and therefore the Company considers this a critical accounting estimate.

Its yearly analysis considers both qualitative and quantitative

factors that may have a significant impact on the investee’s fair value.

Qualitative analysis of its investments involves understanding

the financial performance and near-term prospects of the investee, changes in general market conditions in the investee’s industry

or geographic area, and the management and governance structure of the investee.

Quantitative assessments of the fair value of its investments

are developed using the market and income approaches.

The market approach includes the use of comparable financial metrics of private

and public companies and recent financing rounds.

The income approach includes the use of a discounted cash flow model, which requires

significant estimates regarding the investees’ revenue, costs, and discount rates.

The Company’s assessment of these factors

in determining whether an impairment exists could change in the future due to new developments or changes in applied assumptions.

Other-Than-Temporary

Company’s long-term equity investments are subject to a periodic impairment review.

Impairments affect earnings as follows:

Marketable equity securities

include the consideration of general market conditions, the duration and extent to which the fair value is below cost, and our ability

and intent to hold the investment for a sufficient period of time to allow for recovery of value in the foreseeable future.

also considers specific adverse conditions related to the financial health of, and the business outlook for, the investee, which

may include industry and sector performance, changes in technology, operational and financing cash flow factors, and changes in the

investee’s credit rating.

The Company records other-than-temporary impairments on marketable equity securities and marketable

equity method investments in gains (losses) on equity investments.

equity securities include the consideration of general market conditions, the duration and extent to which the fair value is below

cost, and our ability and intent to hold the investment for a sufficient period of time to allow for recovery of value in the foreseeable

The Company also considers specific adverse conditions related to the financial health of, and the business outlook for,

the investee, which may include industry and sector performance, changes in technology, operational and financing cash flow factors,

and changes in the investee’s credit rating.

The Company records other-than-temporary impairments on marketable equity securities

and marketable equity method investments in gains (losses) on equity investments.

Non-marketable

4 unchanged sentences

additional funding requirements;

and the investee’s ability to remain

A series of operating losses of an investee or other factors may indicate that a decrease in value of the investment has

occurred that is other than temporary and that shall be recognized even though the decrease in value is in excess of what would otherwise

be recognized by application of the equity method.

A loss in value of an investment that is other than a temporary decline shall be recognized.

Evidence of a loss in value might include, but would not necessarily be limited to, absence of an ability to recover the carrying amount

of the investment or inability of the investee to sustain an earnings capacity that would justify the carrying amount of the investment.

The Company records other-than-temporary impairments for non-marketable cost method investments and equity method investments in gains

(losses) on equity investments.

Other-than-temporary impairments of equity investments were both $0 for the six months ended June 30,

2023 and 2022.

The Company evaluates goodwill for impairment

annually or more frequently when an event occurs or circumstances change that indicate the carrying value may not be recoverable.

testing goodwill for impairment, the Company may elect to utilize a qualitative assessment to evaluate whether it is more likely than

not that the fair value of a reporting unit is less than its carrying amount.

If the qualitative assessment indicates that goodwill impairment

is more likely than not, the Company performs a two-step impairment test.

The Company tests goodwill for impairment under the two-step

impairment test by first comparing the book value of net assets to the fair value of the reporting units.

If the fair value is determined

to be less than the book value or qualitative factors indicate that it is more likely than not that goodwill is impaired, a second step

is performed to compute the amount of impairment as the difference between the estimated fair value of goodwill and the carrying value.

and the investee’s ability to

remain in business.

A series of operating losses of an investee or other factors may indicate that a decrease in value of the investment

has occurred that is other than temporary and that shall be recognized even though the decrease in value is in excess of what would

otherwise be recognized by application of the equity method.

A loss in value of an investment that is other than a temporary decline

shall be recognized.

Evidence of a loss in value might include, but would not necessarily be limited to, absence of an ability to

recover the carrying amount of the investment or inability of the investee to sustain an earnings capacity that would justify the

carrying amount of the investment.

The Company records other-than-temporary impairments for non-marketable cost method investments

and equity method investments in gains (losses) on equity investments.

Other-than-temporary impairments of equity investments were

both $0 for the nine months ended September 30, 2023 and 2022.

Company evaluates goodwill for impairment annually or more frequently when an event occurs or circumstances change that indicate the

carrying value may not be recoverable.

In testing goodwill for impairment, the Company may elect to utilize a qualitative assessment

to evaluate whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

If the qualitative

assessment indicates that goodwill impairment is more likely than not, the Company performs a two-step impairment test.

The Company tests

goodwill for impairment under the two-step impairment test by first comparing the book value of net assets to the fair value of the reporting

If the fair value is determined to be less than the book value or qualitative factors indicate that it is more likely than not

that goodwill is impaired, a second step is performed to compute the amount of impairment as the difference between the estimated fair

value of goodwill and the carrying value.

The Company estimates the fair value of the reporting units using discounted cash flows.

Forecasts of future cash flows are based on

our best estimate of future net sales and operating expenses, based primarily on expected category expansion, pricing, market segment

share, and general economic conditions.

The Company completed the required testing of

goodwill for impairment as of June 30, 2023, and determined that goodwill was impaired because of the current financial condition of

the Company and the Company’s inability to generate future operating income without substantial sales volume increases, which are

highly uncertain.

Furthermore, the Company anticipates future cash flows indicate that the recoverability of goodwill is not reasonably

Convertible Notes

The Company accounts

for the convertible notes issued at a discount, by comparing the principal amount and book value, with the calculation of discounted

of future cash flows are based on our best estimate of future net sales and operating expenses, based primarily on expected category

expansion, pricing, market segment share, and general economic conditions.

Company completed the required testing of goodwill for impairment as of September 30, 2023, and determined that goodwill was impaired

because of the current financial condition of the Company and the Company’s inability to generate future operating income without

substantial sales volume increases, which are highly uncertain.

Furthermore, the Company anticipates future cash flows indicate that

the recoverability of goodwill is not reasonably assured.

Company accounts for the convertible notes issued at a discount, by comparing the principal amount and book value, with the calculation

of discounted method.

The Company assess the discount per month.

The amortization period of the promissory note is 18 months.

Research and Development Expenses

The Company accounts

for the cost of using licensing rights in research and development cost according to ASC Topic 730-10-25-1.

This guidance provides that

absent alternative future uses the acquisition of product rights to be used in research and development activities must be charged to

research and development expenses when incurred.

For CDMO business unit, the Company accounts

for R&D costs in accordance with Accounting Standards Codification (“ASC”) 730, Research and Development (“ASC

Research and development expenses are charged to expense as incurred unless there is an alternative future use in other

research and development projects or otherwise.

Research and development expenses are comprised of costs incurred in performing research

and development activities, including personnel-related costs, facilities-related overhead, and outside contracted services including

clinical trial costs, manufacturing and process development costs for both clinical and preclinical materials, research costs, and other

consulting services.

Non-refundable advance payment for goods and services that will be used in future research and development activities

are expensed when the activity has been performed or when the goods have been received rather than when the payment is made.

where the Company enters into agreements with third parties to provide research and development services, costs are expensed as services

are performed.

Post-retirement and post-employment benefits

The Company’s subsidiaries in Taiwan adopted

the government mandated defined contribution plan pursuant to the Labor Pension Act (the “Act”) in Taiwan.

Such labor regulations

require that the rate of contribution made by an employer to the Labor Pension Fund per month shall not be less than 6% of the worker’s

monthly salaries.

Pursuant to the Act, the Company makes monthly contribution equal to 6% of employees’ salaries to the employees’

pension fund.

The Company has no legal obligation for the benefits beyond the contributions made.

The total amounts for such employee

benefits, which were expensed as incurred, were $2,455 and $3,309 for the three months ended June 30, 2023 and 2022, respectively, and

$5,259 and $6,646 for the six months ended June 30, 2023 and 2022, respectively.

Other than the above, the Company does not provide any

other post-retirement or post-employment benefits.

Stock-based Compensation

The Company measures expense associated with

all employee stock-based compensation awards using a fair value method and recognizes such expense in the consolidated financial statements

on a straight-line basis over the requisite service period in accordance with FASB ASC Topic 718 “Compensation-Stock Compensation”.

Total employee stock-based compensation expenses were $0 and $0 for the three and six months ended June 30, 2023 and 2022, respectively.

and Development Expenses

Company accounts for the cost of using licensing rights in research and development cost according to ASC Topic 730-10-25-1.

This guidance

provides that absent alternative future uses the acquisition of product rights to be used in research and development activities must

be charged to research and development expenses when incurred.

CDMO business unit, the Company accounts for R&D costs in accordance with Accounting Standards Codification (“ASC”) 730,

Research and Development (“ASC 730”).

Research and development expenses are charged to expense as incurred unless there is

an alternative future use in other research and development projects or otherwise.

Research and development expenses are comprised of

costs incurred in performing research and development activities, including personnel-related costs, facilities-related overhead, and

outside contracted services including clinical trial costs, manufacturing and process development costs for both clinical and preclinical

materials, research costs, and other consulting services.

Non-refundable advance payment for goods and services that will be used in

future research and development activities are expensed when the activity has been performed or when the goods have been received rather

than when the payment is made.

In instances where the Company enters into agreements with third parties to provide research and development

services, costs are expensed as services are performed.

Post-retirement

and post-employment benefits

Company’s subsidiaries in Taiwan adopted the government mandated defined contribution plan pursuant to the Labor Pension Act (the

“Act”) in Taiwan.

Such labor regulations require that the rate of contribution made by an employer to the Labor Pension Fund

per month shall not be less than 6% of the worker’s monthly salaries.

Pursuant to the Act, the Company makes monthly contribution

equal to 6% of employees’ salaries to the employees’ pension fund.

The Company has no legal obligation for the benefits beyond

the contributions made.

The total amounts for such employee benefits, which were expensed as incurred, were $2,566 and $3,302 for the

three months ended September 30, 2023 and 2022, respectively, and $7,825 and $9,948 for the nine months ended September 30, 2023

and 2022, respectively.

Other than the above, the Company does not provide any other post-retirement or post-employment benefits.

Company measures expense associated with all employee stock-based compensation awards using a fair value method and recognizes such expense

in the consolidated financial statements on a straight-line basis over the requisite service period in accordance with FASB ASC Topic

718 “Compensation-Stock Compensation”.

Total employee stock-based compensation expenses were $0 and $0 for the three

and nine months ended September 30, 2023 and 2022, respectively.

The Company accounted for stock-based compensation

2 unchanged sentences

earlier of the performance commitment date or the date service is completed and recognized over the period the service is provided.

non-employee stock-based compensation expenses were $225,740 and $225,740 for the three months ended June 30, 2023 and 2022, respectively.

Total non-employee stock-based compensation expenses were $592,229 and $4,917,743 for the six months ended June 30, 2023 and 2022,

non-employee stock-based compensation expenses were $817,740 and $225,740 for the three months ended September 30, 2023 and 2022,

respectively.

Beneficial Conversion Feature

From time to time, the Company may issue convertible

notes that may contain an imbedded beneficial conversion feature.

A beneficial conversion feature exists on the date a convertible note

is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated

proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of the warrants, if related

warrants have been granted.

The intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding

amount to additional paid in capital.

The debt discount is amortized to interest expense over the life of the note using the effective

interest method.

The Company accounts for income taxes using the

asset and liability approach which allows the recognition and measurement of deferred tax assets to be based upon the likelihood of realization

of tax benefits in future years.

Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary

differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax

A valuation allowance is provided for deferred tax assets if it is more likely than not these items will expire before the

Company is able to realize their benefits, or future deductibility is uncertain.

Under ASC 740, a tax position is recognized as

a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination

being presumed to occur.

Total non-employee stock-based compensation expenses were $1,409,969 and $5,143,483 for the nine months ended September

30, 2023 and 2022, respectively.

Conversion Feature

time to time, the Company may issue convertible notes that may contain an imbedded beneficial conversion feature.

A beneficial conversion

feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible

into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds

to the fair value of the warrants, if related warrants have been granted.

The intrinsic value of the beneficial conversion feature is

recorded as a debt discount with a corresponding amount to additional paid in capital.

The debt discount is amortized to interest expense

over the life of the note using the effective interest method.

Company accounts for income taxes using the asset and liability approach which allows the recognition and measurement of deferred tax

assets to be based upon the likelihood of realization of tax benefits in future years.

Under the asset and liability approach, deferred

taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial

reporting purposes and the amounts used for income tax purposes.

A valuation allowance is provided for deferred tax assets if it is more

likely than not these items will expire before the Company is able to realize their benefits, or future deductibility is uncertain.

ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained

in a tax examination, with a tax examination being presumed to occur.

The evaluation of a tax position is a two-step process.

The first step is to determine whether it is more-likely-than-not

that a tax position will be sustained upon examination, including the resolution of any related appeals or litigations based on the technical

merits of that position.

The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount

of benefits recognized in the financial statements.

A tax position is measured at the largest amount of benefit that is greater than 50

percent likely of being realized upon ultimate settlement.

Tax positions that previously failed to meet the more-likely-than-not recognition

threshold should be recognized in the first subsequent period in which the threshold is met.

Previously recognized tax positions that

no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the

threshold is no longer satisfied.

Penalties and interest incurred related to underpayment of income tax are classified as income tax expense

in the year incurred.

No significant penalty or interest relating to income taxes has been incurred for the six months ended June 30,

2023 and 2022.

GAAP also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures

and transition.

On December 22, 2017, the SEC issued Staff Accounting

Bulletin (“SAB 118”), which provides guidance on accounting for tax effects of the Tax Act.

SAB 118 provides a measurement

period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC 740.

In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Act for which the accounting under

ASC 740 is complete.

To the extent that a company’s accounting for certain income tax effects of the Tax Act is incomplete but

it is able to determine a reasonable estimate, it must record a provisional estimate to be included in the financial statements.

company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the

basis of the provision of the tax laws that were in effect immediately before the enactment of the Tax Act.

While the Company is able

to make reasonable estimates of the impact of the reduction in corporate rate and the deemed repatriation transition tax, the final impact

of the Tax Act may differ from these estimates, due to, among other things, changes in our interpretations and assumptions, additional

guidance that may be issued by the I.R.S., and actions the Company may take.

The Company is continuing to gather additional information

to determine the final impact.

Valuation of Deferred Tax Assets

A valuation allowance is recorded to reduce the

Company’s deferred tax assets to the amount that is more likely than not to be realized.

In assessing the need for the valuation

allowance, management considers, among other things, projections of future taxable income and ongoing prudent and feasible tax planning

If the Company determines that sufficient negative evidence exists, then it will consider recording a valuation allowance

against a portion or all of the deferred tax assets in that jurisdiction.

If, after recording a valuation allowance, the Company’s

projections of future taxable income and other positive evidence considered in evaluating the need for a valuation allowance prove, with

the benefit of hindsight, to be inaccurate, it could prove to be more difficult to support the realization of its deferred tax assets.

As a result, an additional valuation allowance could be required, which would have an adverse impact on its effective income tax rate

Conversely, if, after recording a valuation allowance, the Company determines that sufficient positive evidence exists in

the jurisdiction in which the valuation allowance was recorded, it may reverse a portion or all of the valuation allowance in that jurisdiction.

In such situations, the adjustment made to the deferred tax asset would have a favorable impact on its effective income tax rate and

results in the period such determination was made.

Loss Per Share of Common Stock

The Company calculates net loss per share in

accordance with ASC Topic 260, “Earnings per Share”.

Basic loss per share is computed by dividing the net loss by the weighted

average number of common shares outstanding during the period.

Diluted loss per share is computed similar to basic loss per share except

that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential

common stock equivalents had been issued and if the additional common shares were dilutive.

Diluted earnings per share excludes all dilutive

potential shares if their effect is anti-dilutive.

Commitments and Contingencies

The Company has adopted ASC Topic 450 “Contingencies”

subtopic 20, in determining its accruals and disclosures with respect to loss contingencies.

Accordingly, estimated losses from loss

contingencies are accrued by a charge to income when information available before financial statements are issued or are available to

be issued indicates that it is probable that an assets had been impaired or a liability had been incurred at the date of the financial

statements and the amount of the loss can be reasonably estimated.

Legal expenses associated with the contingency are expensed as incurred.

If a loss contingency is not probable or reasonably estimable, disclosure of the loss contingency is made in the financial statements

when it is at least reasonably possible that a material loss could be incurred.

Foreign-currency Transactions

For the Company’s subsidiaries in Taiwan,

the foreign-currency transactions are recorded in New Taiwan dollars (“NTD”) at the rates of exchange in effect when the

transactions occur.

Gains or losses resulting from the application of different foreign exchange rates when cash in foreign currency

is converted into New Taiwan dollars, or when foreign-currency receivables or payables are settled, are credited or charged to income

in the year of conversion or settlement.

On the balance sheet dates, the balances of foreign-currency assets and liabilities are restated

at the prevailing exchange rates and the resulting differences are charged to current income except for those foreign currencies denominated

investments in shares of stock where such differences are accounted for as translation adjustments under the Statements of Stockholders’

Equity (Deficit).

Translation Adjustment

The accounts of the Company’s subsidiaries

in Taiwan were maintained, and their financial statements were expressed, in New Taiwan Dollar (“NT$”).

Such financial statements

were translated into U.S.

Dollars (“$” or “USD”) in accordance ASC 830, “Foreign Currency Matters”,

with the NT$ as the functional currency.

According to the Statement, all assets and liabilities are translated at the current exchange

rate, shareholder’s deficit are translated at the historical rates and income statement items are translated at an average exchange

rate for the period.

The resulting translation adjustments are reported under other comprehensive income (loss) as a component of shareholders’

equity (deficit).

Recent Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06,

Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own

Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”).

ASU 2020-06 simplifies the accounting for convertible debt by eliminating the beneficial conversion and cash conversion accounting models.

Upon adoption of ASU 2020-06, convertible debt, unless issued with a substantial premium or an embedded conversion feature that is not

clearly and closely related to the host contract, will no longer be allocated between debt and equity components.

This modification will

reduce the issue discount and result in less non-cash interest expense in financial statements.

ASU 2020-06 also updates the earnings

per share calculation and requires entities to assume share settlement when the convertible debt can be settled in cash or shares.

contracts in an entity’s own equity, the type of contracts primarily affected by ASU 2020-06 are freestanding and embedded features

that are accounted for as derivatives under the current guidance due to a failure to meet the settlement assessment by removing the requirements

to (i) consider whether the contract would be settled in registered shares, (ii) consider whether collateral is required to be posted,

and (iii) assess shareholder rights.

ASU 2020-06 is effective for fiscal years beginning after December 15, 2023.

Early adoption is permitted,

but no earlier than fiscal years beginning after December 15, 2020, and only if adopted as of the beginning of such fiscal year.

Company is currently evaluating the impact that the standard will have on its unaudited consolidated financial statements.

In March 2022, the FASB

issued ASU 2022-02, Troubled Debt Restructurings and Vintage Disclosures.

This ASU eliminates the accounting guidance for troubled debt

restructurings by creditors that have adopted ASU 2016-13, Measurement of Credit Losses on Financial Instruments.

This ASU also enhances

the disclosure requirements for certain loan refinancing and restructurings by creditors when a borrower is experiencing financial difficulty.

In addition, the ASU amends the guidance on vintage disclosures to require entities to disclose current period gross write-offs by year

of origination for financing receivables and net investments in leases within the scope of ASC 326-20.

The ASU is effective for annual

periods beginning after December 15, 2022, including interim periods within those fiscal years.

Adoption of the ASU would be applied

prospectively.

step is to determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including the resolution

of any related appeals or litigations based on the technical merits of that position.

The second step is to measure a tax position that

meets the more-likely-than-not threshold to determine the amount of benefits recognized in the financial statements.

A tax position is

measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement.

Tax positions

that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in

which the threshold is met.

Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized

in the first subsequent financial reporting period in which the threshold is no longer satisfied.

Penalties and interest incurred related

to underpayment of income tax are classified as income tax expense in the year incurred.

No significant penalty or interest relating

to income taxes has been incurred for the nine months ended September 30, 2023 and 2022.

GAAP also provides guidance on de-recognition,

classification, interest and penalties, accounting in interim periods, disclosures and transition.

December 22, 2017, the SEC issued Staff Accounting Bulletin (“SAB 118”), which provides guidance on accounting for tax effects

of the Tax Act.

SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies

to complete the accounting under ASC 740.

In accordance with SAB 118, a company must reflect the income tax effects of those aspects

of the Act for which the accounting under ASC 740 is complete.

To the extent that a company’s accounting for certain income tax

effects of the Tax Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate to be included

in the financial statements.

If a company cannot determine a provisional estimate to be included in the financial statements, it should

continue to apply ASC 740 on the basis of the provision of the tax laws that were in effect immediately before the enactment of the Tax

While the Company is able to make reasonable estimates of the impact of the reduction in corporate rate and the deemed repatriation

transition tax, the final impact of the Tax Act may differ from these estimates, due to, among other things, changes in our interpretations

and assumptions, additional guidance that may be issued by the I.R.S., and actions the Company may take.

The Company is continuing to

gather additional information to determine the final impact.

of Deferred Tax Assets

valuation allowance is recorded to reduce the Company’s deferred tax assets to the amount that is more likely than not to be realized.

In assessing the need for the valuation allowance, management considers, among other things, projections of future taxable income and

ongoing prudent and feasible tax planning strategies.

If the Company determines that sufficient negative evidence exists, then it will

consider recording a valuation allowance against a portion or all of the deferred tax assets in that jurisdiction.

If, after recording

a valuation allowance, the Company’s projections of future taxable income and other positive evidence considered in evaluating

the need for a valuation allowance prove, with the benefit of hindsight, to be inaccurate, it could prove to be more difficult to support

the realization of its deferred tax assets.

As a result, an additional valuation allowance could be required, which would have an adverse

impact on its effective income tax rate and results.

Conversely, if, after recording a valuation allowance, the Company determines that

sufficient positive evidence exists in the jurisdiction in which the valuation allowance was recorded, it may reverse a portion or all

of the valuation allowance in that jurisdiction.

In such situations, the adjustment made to the deferred tax asset would have a favorable

impact on its effective income tax rate and results in the period such determination was made.

Per Share of Common Stock

Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share”.

Basic loss per share is computed

by dividing the net loss by the weighted average number of common stock outstanding during the period.

Diluted loss per share is computed

similar to basic loss per share except that the denominator is increased to include the number of additional common stock that would

have been outstanding if the potential common stock equivalents had been issued and if the additional common stock were dilutive.

earnings per share excludes all dilutive potential shares if their effect is anti-dilutive.

and Contingencies

Company has adopted ASC Topic 450 “Contingencies” subtopic 20, in determining its accruals and disclosures with respect to

loss contingencies.

Accordingly, estimated losses from loss contingencies are accrued by a charge to income when information available

before financial statements are issued or are available to be issued indicates that it is probable that an assets had been impaired or

a liability had been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated.

Legal expenses

associated with the contingency are expensed as incurred.

If a loss contingency is not probable or reasonably estimable, disclosure of

the loss contingency is made in the financial statements when it is at least reasonably possible that a material loss could be incurred.

Foreign-currency

the Company’s subsidiaries in Taiwan, the foreign-currency transactions are recorded in New Taiwan dollars (“NTD”)

at the rates of exchange in effect when the transactions occur.

Gains or losses resulting from the application of different foreign exchange

rates when cash in foreign currency is converted into New Taiwan dollars, or when foreign-currency receivables or payables are settled,

are credited or charged to income in the year of conversion or settlement.

On the balance sheet dates, the balances of foreign-currency

assets and liabilities are restated at the prevailing exchange rates and the resulting differences are charged to current income except

for those foreign currencies denominated investments in shares of stock where such differences are accounted for as translation adjustments

under the Statements of Stockholders’ Equity (Deficit).

accounts of the Company’s subsidiaries in Taiwan were maintained, and their financial statements were expressed, in New Taiwan

Dollar (“NT$”).

Such financial statements were translated into U.S.

Dollars (“$” or “USD”) in accordance

ASC 830, “Foreign Currency Matters”, with the NT$ as the functional currency.

According to the Statement, all assets and

liabilities are translated at the current exchange rate, shareholder’s deficit are translated at the historical rates and income

statement items are translated at an average exchange rate for the period.

The resulting translation adjustments are reported under other

comprehensive income (loss) as a component of shareholders’ equity (deficit).

Accounting Pronouncements

August 2020, the FASB issued ASU 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts

in Entity’s Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity

(“ASU 2020-06”).

ASU 2020-06 simplifies the accounting for convertible debt by eliminating the beneficial conversion and

cash conversion accounting models.

Upon adoption of ASU 2020-06, convertible debt, unless issued with a substantial premium or an embedded

conversion feature that is not clearly and closely related to the host contract, will no longer be allocated between debt and equity

This modification will reduce the issue discount and result in less non-cash interest expense in financial statements.

2020-06 also updates the earnings per share calculation and requires entities to assume share settlement when the convertible debt can

be settled in cash or shares.

For contracts in an entity’s own equity, the type of contracts primarily affected by ASU 2020-06

are freestanding and embedded features that are accounted for as derivatives under the current guidance due to a failure to meet the

settlement assessment by removing the requirements to (i) consider whether the contract would be settled in registered shares, (ii) consider

whether collateral is required to be posted, and (iii) assess shareholder rights.

ASU 2020-06 is effective for fiscal years beginning

after December 15, 2023.

Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, and only if

adopted as of the beginning of such fiscal year.

The Company is currently evaluating the impact that the standard will have on its unaudited

consolidated financial statements.

March 2022, the FASB issued ASU 2022-02, Troubled Debt Restructurings and Vintage Disclosures.

This ASU eliminates the accounting guidance

for troubled debt restructurings by creditors that have adopted ASU 2016-13, Measurement of Credit Losses on Financial Instruments.

ASU also enhances the disclosure requirements for certain loan refinancing and restructurings by creditors when a borrower is experiencing

financial difficulty.

In addition, the ASU amends the guidance on vintage disclosures to require entities to disclose current period

gross write-offs by year of origination for financing receivables and net investments in leases within the scope of ASC 326-20.

is effective for annual periods beginning after December 15, 2022, including interim periods within those fiscal years.

Adoption of the

ASU would be applied prospectively.

Early adoption is also permitted, including adoption in an interim period.

The Company is currently evaluating the impact

that the standard will have on its unaudited consolidated financial statements.

Estimates and Assumptions

In preparing our consolidated financial statements,

we use estimates and assumptions that affect the reported amounts and disclosures.

Our estimates are often based on complex judgments,

probabilities and assumptions that we believe to be reasonable, but that are inherently uncertain and unpredictable.

We are also subject

to other risks and uncertainties that may cause actual results to differ from estimated amounts.

Results of Operations — Three Months

Ended June 30, 2023 Compared to Three Months Ended June 30, 2022.

The following table presents, for the three months

indicated, our unaudited consolidated statements of operations information.

The Company is currently

evaluating the impact that the standard will have on its unaudited consolidated financial statements.

and Assumptions

preparing our consolidated financial statements, we use estimates and assumptions that affect the reported amounts and disclosures.

estimates are often based on complex judgments, probabilities and assumptions that we believe to be reasonable, but that are inherently

uncertain and unpredictable.

We are also subject to other risks and uncertainties that may cause actual results to differ from estimated

of Operations — Three Months Ended September 30, 2023 Compared to Three Months Ended September 30, 2022.

following table presents, for the three months indicated, our unaudited consolidated statements of operations information.

Three Months Ended

September 30,

Cost of revenues

Gross (loss) profit

Operating expenses

10 unchanged sentences

Other (expense) income

Total other income

Loss before provision income tax

Provision for income tax

Total other (expense) income

Loss before income tax

Provision for (benefit from) income tax

Net loss attributable to noncontrolling interests

6 unchanged sentences

Basic and diluted

Weighted average number of common shares outstanding:

Weighted average number of common stock outstanding:

Basic and diluted

We generated $6,109

and $312,860 in revenues for the three months ended June 30, 2023 and 2022, respectively.

The decrease in revenues was mainly due to the

decrease in revenue from Contract Development and Manufacturing Organization (“CDMO) services.

We generated $15,884 and

$42,269 in revenues for the three months ended September 30, 2023 and 2022, respectively.

The decrease in revenues was due to completion

of ongoing projects and awaiting for new approval.

Operating Expenses.

Our operating

expenses have decreased by $224,383 or 10%, to $2,126,970 for the three months ended June 30, 2023 from $2,351,353 for the three months

ended June 30, 2022.

Such decrease in operating expenses was mainly attributable to the decrease in selling, general and administrative

expenses and research and development expenses.

Other Income (Expense) .

expense was $39,688 for the three months ended June 30, 2023, compared to other income of $17,076 for the three months ended June 30,

The change was principally caused by the increase in interest expense and the loss on foreign exchange changes, while being offset

by the increase in interest income for the three months ended June 30, 2023, and decrease in other expenses for the three months ended

June 30, 2022.

Interest income (expense), net, was $(59,711) for the three months

ended June 30, 2023, compared to $24,257 for the three months ended June 30, 2022.

The decrease of $83,968, or approximately 346%, was

primarily due to the increase in interest expense due to recognition of interest expense for the converted notes for proper accounting

expenses have decreased by $1,606,226 or 43%, to $2,141,143 for the three months ended September 30, 2023 from $3,747,369 for the three

months ended September 30, 2022.

Such decrease in operating expenses was mainly attributable to the decrease in selling, general and

administrative expenses and research and development expenses, since research and development projects have been dormant as the Company

waits for results for further development, while being offset by the increase in stock-based compensation.

Income (Expense) .

Our other expense was $1,214,206 for the three months ended September

30, 2023, compared to other expense of $56,461 for the three months ended September 30, 2022.

The change was principally caused by the

increase in interest expense and the loss on foreign exchange changes, while being offset by the increase in interest income for the three

months ended September 30, 2023, and decrease in other expenses for the three months ended September 30, 2022.

Interest income (expense), net, was $(1,178,378)

for the three months ended September 30, 2023, compared to $(78,372) for the three months ended September 30, 2022.

The increase of $1,100,006,

or approximately 1,404%, was primarily due to the increase in interest expense due to recognition of interest expense for the converted

notes for proper accounting purpose.

As a result of the

above factors, our net loss was $2,315,225 for the three months ended June 30, 2023 compared to $1,947,333 for the three months ended

June 30, 2022, representing a decrease of $367,892, or 19%.

Results of Operations — Six Months Ended

June 30, 2023 Compared to Six Months Ended June 30, 2022.

The following table presents, for the six months

indicated, our unaudited consolidated statements of operations information.

Six Months Ended

above factors, our net loss was $3,368,080 for the three months ended September 30, 2023 compared to $3,776,524 for the three months ended

September 30, 2022, representing a decrease of $408,444, or 11%.

of Operations — Nine Months Ended September 30, 2023 Compared to Nine Months Ended September 30, 2022.

following table presents, for the nine months indicated, our unaudited consolidated statements of operations information.

Nine Months Ended

September 30,

Cost of revenues

Gross (loss) profit

Operating expenses

4 unchanged sentences

Loss from operations

(11,981,422 )

Other income (expense)

4 unchanged sentences

Other (expense) income

Total other income

Loss before provision income tax

Provision for income tax

Total other (expense) income

Loss before income tax

(11,976,568 )

(Benefit from) provision for income tax

(11,811,472 )

Net loss attributable to noncontrolling interests

Net loss attributed to ABVC and subsidiaries

(11,559,301 )

Foreign currency translation adjustment

4 unchanged sentences

Basic and diluted

Weighted average number of common shares outstanding:

Weighted average number of common stock outstanding:

Basic and diluted

We generated $150,265

and $338,520 in revenues for the six months ended June 30, 2023 and 2022, respectively.

The decrease in revenues was mainly due to the

decrease in revenue from Contract Development and Manufacturing Organization (“CDMO”) services.

and $380,789 in revenues for the nine months ended September 30, 2023 and 2022, respectively.

The decrease in revenues was mainly due

to completion of ongoing projects and waiting for new approval.

Operating Expenses.

Our operating

expenses have decreased by $4,492,648, or 52%, to $4,101,190 for the six months ended June 30, 2023 from $8,593,838 for the six months

ended June 30, 2022.

Such decrease in operating expenses was mainly attributable to the decrease in stock-based compensation expenses

by $4,325,514 which relates to costs in conjunction with non-employee transferred stock.

expenses have decreased by $6,098,874, or 49%, to $6,242,333 for the nine months ended September 30, 2023 from $12,341,207 for the nine

months ended September 30, 2022.

Such decrease in operating expenses was mainly attributable to the decrease in selling, general and

administrative expenses, research and development expenses, since research and development projects have been dormant as the Company

waits for results for further development, and stock-based compensation expenses by $3,733,514 which relates to costs in conjunction

with non-employee transferred stock.

Other Income (Expense) .

expense was $(30,734) for the six months ended June 30, 2023, compared to other income of $61,315 for the six months ended June 30, 2022.

The change was principally caused by the increase in interest expense and loss on foreign exchange changes, while being offset by the

increase in interest income for the six months ended June 30, 2023, and decrease in other expenses for the six months ended June 30,

expense was $(1,244,940) for the nine months ended September 30, 2023, compared to other income of $4,854 for the nine months ended September

The change was principally caused by the increase in interest expense and loss on foreign exchange changes, while being offset

by the increase in interest income for the nine months ended September 30, 2023, and decrease in other expenses for the nine months ended

September 30, 2022.

Interest income (expense), net, was $(1,242,041)

for the six months ended June 30, 2023, compared to $46,219 for the six months ended June 30, 2022.

The decrease of $109,882, or

approximately 238%, was primarily due to the increase in interest expense due to recognition of interest expense for the converted notes

for proper accounting purpose .

for the nine months ended September 30, 2023, compared to $(32,153) for the nine months ended September 30, 2022.

The increase of

$1,209,888, or approximately 3,763%, was primarily due to the increase in interest expense due to recognition of interest expense for

the converted notes for proper accounting purpose.

As a result of the

above factors, our net loss was $4,212,455 for the six months ended June 30, 2023 compared to $8,034,948 for the six months ended June

30, 2022, representing a decrease of $3,822,493, or 48%.

Liquidity and Capital Resources

above factors, our net loss was $7,580,535 for the nine months ended September 30, 2023 compared to $11,811,472 for the nine months ended

September 30, 2022, representing a decrease of $4,230,937, or 36%.

Liquidity and Capital

Working Capital

September 30,

Current Assets

1 unchanged sentence

Working Capital (Deficit)

$ (2,832,282 )

Cash Flow from Operating Activities

During the six months ended June 30, 2023 and 2022, the net cash used

in operating activities were $2,397,460 and $6,423,618, respectively.

The decrease was primarily due to the decreased in non-cash stock-based

compensation for nonemployees, due from related parties, and net loss during the six months ended June 30, 2023.

Cash Flow from Investing Activities

During the six months ended June 30, 2023 and

2022, the net cash used in investing activities were $440,575 and $115,246 respectively.

The increases were mainly due to the increase

in prepayment for long-term investments during six months ended June 30, 2023.

Cash Flow from Financing Activities

During the six months ended June 30, 2023 and 2022, the net cash provided

by financing activities were $2,175,000 and $3,663,925, respectively.

The decrease in net cash provided by financing activities were primarily

due to the proceeds from convertible notes, while being offset by repayment of short-term loans during the six months ended June 30, 2023.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT

As a smaller reporting company, we are not required

to provide the information required by this item.

Flow from Operating Activities

During the nine months ended September 30, 2023

and 2022, the net cash used in operating activities were $3,756,385 and $6,937,322, respectively.

The decrease was primarily due

to the increase in other non-cash expenses, and decreased in non-cash stock-based compensation for nonemployees, due from related parties,

due to related parties, and net loss during the nine months ended September 30, 2023.

Flow from Investing Activities

the nine months ended September 30, 2023 and 2022, the net cash used in investing activities were $514,359 and $1,638,396 respectively.

decreases were mainly due to the increase in prepayment for long-term investments during nine months ended September 30, 2023.

Flow from Financing Activities

During the nine months ended September 30, 2023

and 2022, the net cash provided by financing activities were $3,831,540 and $4,267,425, respectively.

The decrease in net cash provided

by financing activities were primarily due to the proceeds from convertible notes, warrant issuance and issuance of common stock for debt

conversion, while being offset by repayment of short-term loans during the nine months ended September 30, 2023.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

a smaller reporting company, we are not required to provide the information required by this item.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis