What changed in this filing

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Item 7. Management’s Discussion and Analysis

2023-04-17 compared with 2022-03-31 · 320 added, 439 removed, 89 unchanged (90% of the section changed)

Management’s Discussion and Analysis

of Financial Condition and Results of Operations.

Management’s Discussion and

Analysis of Financial Condition and Results of Operations.

The following discussion

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See “Cautionary Note Regarding Forward-Looking Statements.”

We are a biotech innovation

company with a mission of prolonging life and enhancing its quality by improving the health of the immune system.

We are developing biotechnologies

specifically focused on improving the health of the immune system through immune reprogramming and monitoring.

Our immune reprogramming

technologies are currently at the pre-clinical stage and are designed to retrain the immune system to induce tolerance with an objective

of addressing rejection of transplanted organs, autoimmune diseases, and allergies.

Our immune monitoring technologies are designed to

provide a personalized comprehensive profile of the immune system and we plan to utilize them in our upcoming reprogramming clinical trials

to monitor subjects’ immune response before, during and after drug administration.

Recent Developments

Nasdaq Stock Market, LLC Notification:

On January 18, 2022, the Company was notified

(the “Notification Letter”) by The Nasdaq Stock Market, LLC (“Nasdaq”) that it is not in compliance with the minimum

bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) for continued listing on The Nasdaq Capital Market.

Nasdaq Listing

Rule 5550(a)(2) requires listed securities to maintain a minimum bid price of $1.00 per share, and Nasdaq Listing Rule 5810(c)(3)(A) provides

that a failure to meet the minimum bid price requirement exists if the deficiency continues for a period of 30 consecutive business days.

Based on the closing bid price of the Company’s common stock between December 1, 2021 and January 14, 2022, the Company no longer

met the minimum bid price requirement.

The Notification Letter had no immediate effect on the listing or trading of the Company’s

common stock on The Nasdaq Capital Market and, at the time, the common stock continued to trade on The Nasdaq Capital Market under the

symbol “ADTX.”

The Notification Letter provided the Company has

180 calendar days, or until July 18, 2022, to regain compliance with Nasdaq Listing Rule 5550(a)(2).

To regain compliance, the bid price

of the Company’s common stock must have a closing bid price of at least $1.00 per share for a minimum of 10 consecutive business days.

If the Company does not regain compliance by July 18, 2022, an additional 180 days may be granted to regain compliance, so long as the

Company meets The Nasdaq Capital Market continued listing requirements (except for the bid price requirement) and notifies Nasdaq in writing

of its intention to cure the deficiency during the second compliance period.

If the Company does not qualify for the second compliance

period or fails to regain compliance during the second 180-day period, then Nasdaq will notify the Company of its determination to delist

the Company’s common stock, at which point the Company will have an opportunity to appeal the delisting determination to a Hearings Panel.

The Company intends to monitor the closing bid

price of its common stock and will consider implementing available options to regain compliance with the minimum bid price requirement

under the Nasdaq Listing Rules.

On January 28, 2022, the Compensation Committee

approved the grant of 482,700 RSUs to employees pursuant to the Company’s 2021 Equity Incentive Plan.

Included in this grant were

480,000 RSUs granted to officers of the Company.

Forbearance Agreement:

On January 31, 2022, the Company’s $14.5

million loan (“Loan”) to Cellvera Global became fully due and payable under the Secured Credit Agreement.

On February 14,

2022, the Company entered into a Forbearance Agreement and Seventh Amendment to Secured Credit Agreement (the “Forbearance Agreement”)

with AiPharma Global Holdings LLC, a Delaware limited liability company, which intends to change its name to Cellvera Global Holdings

LLC (“Cellvera Global”), Cellvera Holdings Ltd., a company formed under the laws of the British Virgin Islands f/k/a AiPharma

Holdings Limited (“Cellvera Holdings”), Cellvera Asia Limited, a company formed under the laws of Hong Kong f/k/a AiPharma

Asia Limited (“Cellvera Asia” and together with Cellvera Global and Cellvera Holdings, the “Borrower”).

January 31, 2022, the Company’s $14.5 million loan (the “Loan”) to Borrower became fully due and payable under that

certain Secured Credit Agreement dated as of August 27, 2021, as amended to date (the “Credit Agreement”).

Pursuant to the Forbearance Agreement, the Company

agreed to forbear from exercising its rights and remedies against the Borrower and certain affiliated guarantor parties until the earlier

of (i) June 30, 2022 or (ii) the date of occurrence of any event of default under the Forbearance Agreement (the “Forbearance Period”).

Given that the parties continue to conduct due diligence in connection with that certain Share Exchange Agreement dated as of December

28, 2021 by and between the Company and AiPharma Group Ltd.

(see note 4), the Company and the Borrower

also agreed that should the initial closing occur under the Share Exchange Agreement, the existing event of default will be waived.

the Forbearance Agreement, the Company and the Borrower also agreed to certain amendments to the Credit Agreement, including, but not

(i) the delivery by the Borrower of certain financial statements and forecasts, and (ii) certain regularly scheduled payments

to be made by Borrower to the Company during the Forbearance Period.

Immune Reprogramming

We are an innovation company with a mission of

Making Promising Innovations Possible, Together.

We develop, build, and grow innovations with a focus on monitoring and modulating the

immune system.

We take a socialized approach to innovation by engaging stakeholders into all aspects of the process.

Our innovation portfolio includes

the following programs:

- Adimune™ - Immune modulation technologies which are

currently at the pre-clinical stage and are designed to retrain the immune system to induce tolerance with an objective of addressing

rejection of transplanted organs, autoimmune diseases, and allergies.

- AditxtScore™ - Immune monitoring technologies designed

to provide a personalized comprehensive profile of the immune system.

Modulation Program)

The discovery of immunosuppressive

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unwanted immune responses in autoimmune diseases.

However, immune suppression leads to significant undesirable side effects, such as increased

susceptibility to life-threatening infections and cancers, because it indiscriminately and broadly suppresses immune function throughout

While the use of these drugs has been justifiable because they prevent or delay organ rejection, their use for treatment of

autoimmune diseases and allergies may not be acceptable because of the aforementioned side effects.

Furthermore, transplanted organs often

ultimately fail despite the use of immune suppression, and about 40% of transplanted organs survive no more than 5 years.

New, focused therapeutic approaches

are needed that modulate only the small portion of immune cells that are involved in rejection of the transplanted organ, as this approach

can be safer for patients than indiscriminate immune suppression.

Such approaches are referred to as immune tolerance, and when therapeutically

induced, may be safer for patients and also potentially allow long-term survival of transplanted tissues and organs.

However, immune suppression leads to significant undesirable side effects, such as

increased susceptibility to life-threatening infections and cancers, because it indiscriminately and broadly suppresses immune function

throughout the body.

While the use of these drugs has been justifiable because they prevent or delay organ rejection, their use for treatment

of autoimmune diseases and allergies may not be acceptable because of the aforementioned side effects.

Furthermore, transplanted organs

often ultimately fail despite the use of immune suppression, and about 40% of transplanted organs survive no more than 5 years.

New, focused therapeutic

approaches are needed that modulate only the immune cells involved in rejection of the transplanted organ, as this approach can be safer

for patients than indiscriminate immune suppression.

Such approaches are referred to as immune tolerance, and when therapeutically induced,

may be safer for patients and potentially allow longer-term survival of transplanted tissues and organs.

In the late 1990s, academic

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Department of Defense.

The focus of that project was for skin grafting for burn

Twenty years of research at LLU and an affiliated incubator led to a series of discoveries that have been translated into a large

patent portfolio of therapeutic approaches that may be applied to the modulation of the immune system in order to induce tolerance to

self and transplanted organs.

The focus of that project was induction of tolerance

for skin allografting for burn victims.

Twenty years of research at LLU and an affiliated incubator led to a series of discoveries that

have been translated into a large patent portfolio of therapeutic approaches that may be applied to the modulation of the immune system

to induce tolerance to self and transplanted organs.

We have an exclusive worldwide

license for commercializing this nucleic acid-based technology (which is currently at the pre-clinical stage), named Apoptotic DNA Immunotherapy™

(ADI™) from LLU, which utilizes a novel approach that mimics the way the body naturally induces tolerance to our own tissues (“therapeutically

induced immune tolerance”).

While immune suppression requires continuous administration to prevent rejection of a transplanted organ,

induction of tolerance has the potential to retrain the immune system to accept the organ for longer periods of time.

may allow patients to live with transplanted organs with significantly reduced immune suppression.

ADI™ is a technology platform

which we believe can be engineered to address a wide variety of indications.

license for commercializing Apoptotic DNA Immunotherapy™ (ADI™), a nucleic acid-based technology (which is currently at the

pre-clinical stage), from LLU.

ADI™ utilizes a novel approach that mimics the way the body naturally induces tolerance to our own

tissues (“therapeutically induced immune tolerance”).

While immune suppression requires continuous administration to prevent

rejection of a transplanted organ, induction of tolerance has the potential to retrain the immune system to accept the organ for longer

periods of time.

Thus, ADI™ may allow patients to live with transplanted organs with significantly reduced immune suppression.

ADI™ is a technology platform which we believe can be engineered to address a wide variety of indications.

We are developing ADI™

products for organ transplantation including skin grafting, autoimmune diseases, and allergies, with the initial focus on skin allografts

and psoriasis, as we believe these indications will be most efficient in providing safety and efficacy data in clinical trials.

a Biologics License Application (“BLA”) for a biopharmaceutical product, clinical safety and efficacy must be demonstrated

in a series of clinical studies conducted with human subjects.

For products in our class of drugs, the first-in-human trials will be a

combination of Phase I (safety/tolerability) and Phase II (efficacy) in affected subjects.

To obtain approval to initiate the Phase I/IIa

studies, an Investigational New Drug Application will be submitted to compiling non-clinical efficacy data as well as manufacturing and

pre-clinical or clinical trial toxicology data.

To date, we have conducted non-clinical studies in a stringent model of skin transplantation

using genetically mismatched donor and recipient animals demonstrating a 3-fold increase in the survival of the skin graft in animals

that were tolerized with ADI™ compared to animals that receive immune suppression alone.

Prolongation of graft life was observed

despite discontinuation of immune suppression after the first 5 weeks.

Additionally, in an induced non-clinical model for psoriasis, ADI™

treatment resulted in a 69% reduction in skin thickness and a 38% decrease in skin flaking (two clinical parameters for assessment of

psoriasis skin lesions).

The Phase I/IIa studies in psoriasis will evaluate the safety/tolerability of ADI™ in patients diagnosed

with psoriasis.

Since the drug will be administered in subjects diagnosed with psoriasis, effectiveness of the drug to improve psoriatic

lesions will also be evaluated.

In another Phase I/IIa study, patients requiring skin allografts will receive weekly intra-dermal injections

of ADI™ in combination with standard immune suppression to assess safety/tolerability and possibility of reducing levels of immunosuppressive

drugs as well as prolongation of graft life.

Later phase trials are planned after successful completion of these studies in preparation

for submission for a BLA to regulatory agencies.

Immune Monitoring

products for organ transplantation including skin allografting, autoimmune diseases, and allergies, with the initial focus on psoriasis,

type 1 diabetes and skin allografting, indications for which we have compelling preclinical data.

To submit a Biologics License Application

(“BLA”) for a biopharmaceutical product, clinical safety and efficacy must be demonstrated in clinical studies conducted

with human subjects.

For products in our class of drugs, the first-in-human trials will be a combination of Phase I (safety/tolerability)

and Phase II (efficacy) in affected subjects.

To obtain approval to initiate the Phase I/IIa studies, an Investigational New Drug or

Clinical Trial Application will be submitted that will include a compilation of non-clinical efficacy data as well as manufacturing and

pre-clinical safety/toxicology data.

To date, we have conducted non-clinical studies in a stringent model of skin transplantation using

genetically mismatched donor and recipient animals demonstrating a 3-fold increase in the survival of the skin allograft in animals that

were tolerized with ADI™ compared to animals that receive immune suppression alone.

Prolongation of graft life was observed despite

discontinuation of immune suppression after the first 5 weeks.

In a non-obese diabetic mouse model of type 1 diabetes, we showed reversal

of hyperglycemia with 80% of the animals showing durable glycemic control for the 40-week study period.

Additionally, in an induced non-clinical

model for psoriasis, ADI™ treatment resulted in a 69% reduction in skin thickness and a 38% decrease in skin flaking (two clinical

parameters for assessment of psoriasis skin lesions).

The Phase I/IIa studies in psoriasis will evaluate the safety/tolerability of ADI™

in patients diagnosed with psoriasis.

Since the drug will be administered in subjects diagnosed with psoriasis, effectiveness of the

drug to improve psoriatic lesions will also be evaluated.

In the type 1 diabetes clinical studies, newly diagnosed subjects will receive

ADI™ treatment to evaluate safety and efficacy.

In another Phase I/IIa study, patients requiring skin allografts will receive weekly

intra-dermal injections of ADI™ in combination with standard immune suppression to assess safety/tolerability and possibility of

reducing levels of immunosuppressive drugs as well as prolongation of graft life.

(Immune Monitoring Program)

We believe that understanding

the status of an individual’s immune system is key to developing and administering immunotherapies such as ADI™.

We have secured

an exclusive worldwide license for commercializing a technology platform named AditxtScore™, which provides a personalized comprehensive

profile of the immune system.

It is intended to be informative for individual immune responses to viruses, bacterial antigens, peptides,

drugs, bone marrow and solid organ transplants, and cancer.

It has broad applicability to many other agents of clinical interest impacting

the immune system, including those not yet identified such as future infectious agents.

the status of an individual’s immune system is key to understanding health by the numbers and for developing therapeutics that

result in better outcomes for more individuals.

We have secured an exclusive worldwide license for commercializing a technology platform

named AditxtScore™, which provides a personalized comprehensive profile of the immune system.

AditxtScore™ is intended to

be informative for individual immune responses to viruses, bacteria, peptides, drugs, supplements, bone marrow and solid organ transplants

It has broad applicability to many other agents of clinical interest impacting the immune system, including those not yet

identified such as emerging infectious agents.

AditxtScore™ is being

designed to allow individuals to understand, manage and monitor their immune profiles in order to be informed about attacks on or by their

immune system.

We believe AditxtScore™ can also assist the medical community in anticipating possible immune responses and reactions

to viruses, bacteria, allergens and transplanted organs.

It can be useful in anticipating attacks on the body by having the ability to

determine its potential response and for developing a plan to deal with an undesirable reaction by the immune system.

Its advantages include

the ability to provide a simple, rapid, accurate, high throughput, single platform assay that can be multiplexed to determine the immune

status with respect to several factors simultaneously, in 3-16 hours, as well as detect antigen and antibody in a single test (i.e.

recovered, immune).

In addition, it can determine and differentiate between various types of cellular and humoral immune responses (T

and B cells).

It also provides for simultaneous monitoring of cell activation and levels of cytokine release (i.e., cytokine storms).

designed to allow individuals to understand, manage and monitor their immune profiles in order to be informed about attacks on or by

their immune system.

We believe AditxtScore™ can also assist the medical community in anticipating possible immune responses and

reactions to viruses, bacteria, allergens and foreign tissues such as transplanted organs.

This capability may be possible by having

the ability to determine the body’s potential response and for developing a plan to deal with an undesirable reaction by the immune

Its advantages include the ability to provide a simple, rapid, accurate, high throughput assays that can be multiplexed to determine

the immune status with respect to several factors simultaneously, in 3-16 hours.

In addition, it can determine and differentiate between

various types of cellular and humoral immune responses (T and B cells and other cell types).

It also provides for simultaneous monitoring

of cell activation and levels of cytokine release (i.e., cytokine storms).

We plan to utilize AditxtScore™

in our upcoming clinical trials to monitor subjects’ immune response before, during and after ADI™ drug administration.

are also evaluating plans to obtain FDA approval for AditxtScore™’s use as a clinical assay and seeking to secure manufacturing,

marketing and distribution partnerships for application in the Infectious Diseases market, by end of 2020.

To obtain FDA approval to use

AditxtScore™ as a clinical assay, we plan to conduct validation studies comparing AditxtScore™ to other immunological tests

to demonstrate reproducibility of data and to demonstrate the sensitivity of the assays for use in different indications (e.g., detection

of antigens present in infectious agents or antibodies against infectious agents).

We believe that these data will show AditxtScore™’s

ability to multiplex in two ways using a single assay:

(i) evaluating the immune response to multiple antigens (from different infectious

agents) and (ii) measuring quantities of multiple cytokines.

Furthermore, we believe that the additional validation studies will demonstrate

AditxtScore™’s ability to measure the presence of several antibody isotypes against several antigens in a single reaction.

Our plan is to submit a 510(K) application to the FDA after successful completion of these studies.

We have engaged consultants for our

communications and submissions to the FDA.

Beyond 2021, we plan to develop AditxtScore™ for applications in additional markets such

as Organ Rejection, Allergies, Drug/Vaccine Response, and Disease Susceptibility.

The initial application of

the platform will be AditxtScore™ for COVID-19 which has been designed to provide a more complete assessment of an individual’s

infection and immunity status with respect to the SARS-CoV-2 virus.

Infection status will be determined by evaluating the presence or

absence of the virus, and immunity status by measuring levels of antibodies against viral antigens and their ability to neutralize the

We will soon be expanding the panel to measure other components of the immune response such as cellular immunity.

In early 2021,

we established our AditxtScore™ Immune Monitoring Center in Richmond, Virginia (the “Center”).

The Center operates as

a Clinical Laboratory Improvement Amendments (CLIA) certified facility for the processing of our AditxtScore™ for COVID-19 Lab Developed

Test (LDT) for our prospective channel partners, including labs and hospitals.

License Agreement with Loma Linda University

in our upcoming pre-clinical and clinical studies to monitor subjects’ immune response before, during and after ADI™ drug

administration.

We are also evaluating plans to obtain regulatory approval for AditxtScore™’s use as a clinical assay and

seeking to secure manufacturing, marketing and distribution partnerships for application in the various markets.

To obtain regulatory

approval to use AditxtScore™ as a clinical assay, we have conducted validation studies to evaluate its performance in detection

of antibodies and plan to continue conducting additional validation studies for new applications in autoimmune diseases and transplantation.

License Agreement

with Loma Linda University

On March 8, 2018, we entered

into an Assignment Agreement (the “Assignment Agreement”) with Sekris Biomedical, Inc.

a party to a License Agreement with Loma Linda University (“LLU”), entered into and made effective on May 25, 2011, and amended

on June 24, 2011, July 16, 2012 and December 27, 2012 (the “Original Agreement,” and together with the Assignment Agreement,

the “Sekris Agreements”).

Pursuant to the Assignment Agreement, Sekris transferred and assigned all of its rights and obligations

in and to the liabilities under the Original Agreement, of whatever kind or nature, to us.

In exchange, on March 8, 2018, we issued a

warrant to Sekris to purchase up to 500,000 shares of our common stock (the “Sekris Warrant”).

The warrant was immediately

exercisable and has an exercise price of $4.00 per share.

a party to a license agreement with LLU, entered and made effective on May 25, 2011, and amended on June 24, 2011, July 16, 2012 and

December 27, 2012 (the “Original Agreement,” and together with the Assignment Agreement, the “Sekris Agreements”).

Pursuant to the Assignment Agreement, Sekris transferred and assigned all of its rights, obligations and liabilities under the Original

Agreement, of whatever kind or nature, to us.

In exchange, on March 8, 2018, we issued a warrant to Sekris to purchase up to 10,000 shares

of our common stock (the “Sekris Warrant”).

The warrant was immediately exercisable and has an exercise price of $200.00

The expiration date of the warrant is March 8, 2023.

On March 15, 2018, as amended

on July 1, 2020, we entered into a LLU License Agreement directly with Loma Linda University, which amends and restates the Sekris Agreements.

On March 15, 2018, as amended on July 1, 2020, we entered into a LLU

License Agreement directly with Loma Linda University, which amends and restates the Sekris Agreements.

Pursuant to the LLU License

6 unchanged sentences

Agreement, we are required to pay an annual license fee to LLU.

Also, we paid LLU $455,000 in July 2020 in payment of outstanding milestone

payments and license fees.

Also, we paid LLU $455,000 in July 2020 for outstanding milestone payments

and license fees.

We are also required to pay to LLU milestone payments in connection with certain development milestones.

Specifically,

we are required to make the following milestone payments:

$175,000 on March 31, 2022;

we are required to make the following milestone payments to LLU:

$175,000 on March 31, 2022;

$100,000 on March 31, 2024;

March 31, 2026;

and $500,000 on March 31, 2027.

Additionally, as consideration for prior expenses incurred by LLU to prosecute, maintain and defend

the LLU Patent and Technology Rights, we were obligated to make the following payments to LLU:, $70,000 was paid at the end of December

2018, and a final payment of $60,000 due at the end of March 2019.

We are required to defend the LLU Patent and Technology Rights during

the term of the LLU License Agreement.

Additionally, we will owe royalty payments of (i) 1.5% of Net Product Sales and Net Service Sales

on any Licensed Products (defined as any finished pharmaceutical products which utilizes the LLU Patent and Technology Rights in its development,

manufacture or supply), and (ii) 0.75% of Net Product Sales and Net Service Sales for Licensed Products and Licensed Services not covered

by a valid patent claim for technology rights and know-how for a three (3) year period beyond the expiration of all valid patent claims.

We also are required to produce a written progress report to LLU, discussing our development and commercialization efforts, within 45

days following the end of each year.

All intellectual property rights in and to LLU Patent and Technology Rights shall remain with LLU

(other than improvements developed by or on our behalf).

The LLU License Agreement shall

terminate on the last day that a patent granted to us by LLU is valid and enforceable or the day that the last patent application licensed

to us is abandoned.

The LLU License Agreement may be terminated by mutual agreement or by us upon 90 days written notice to LLU.

terminate the LLU License Agreement in the event of (i) non-payments or late payments of royalty, milestone and license maintenance fees

not cured within 90 days after delivery of written notice by LLU, (ii) a breach of any non-payment provision (including the provision

that requires us to meet certain deadlines for milestone events (each, a “Milestone Deadline”)) not cured within 90 days after

delivery of written notice by LLU and (iii) LLU delivers notice to us of three or more actual breaches of the LLU License Agreement by

us in any 12-month period.

In lieu of the $175,000 milestone payment due on March 31, 2022, the Company paid LLU

an extension fee of $100,000.

Upon payment of this extension fee, an additional year will be added for the March 31, 2022 milestone.

Additionally, as consideration for prior expenses incurred by LLU to prosecute, maintain and defend the LLU Patent and Technology Rights,

we made the following payments to LLU:

$70,000 at the end of December 2018, and a final payment of $60,000 at the end of March 2019.

We are required to defend the LLU Patent and Technology Rights during the term of the LLU License Agreement.

Additionally, we will owe

royalty payments of (i) 1.5% of Net Product Sales (as such terms are defined under the LLU License Agreement) and Net Service Sales on

any Licensed Products (defined as any finished pharmaceutical products which utilizes the LLU Patent and Technology Rights in its development,

manufacture or supply), and (ii) 0.75% of Net Product Sales and Net Service Sales for Licensed Products and Licensed Services (as such

terms are defined under the LLU License Agreement) not covered by a valid patent claim for technology rights and know-how for a three

(3) year period beyond the expiration of all valid patent claims.

We also are required to produce a written progress report to LLU, discussing

our development and commercialization efforts, within 45 days following the end of each year.

All intellectual property rights in and

to LLU Patent and Technology Rights shall remain with LLU (other than improvements developed by or on our behalf).

The LLU License Agreement

shall terminate on the last day that a patent granted to us by LLU is valid and enforceable or the day that the last patent application

licensed to us is abandoned.

The LLU License Agreement may be terminated by mutual agreement or by us upon 90 days written notice to

LLU may terminate the LLU License Agreement in the event of (i) non-payments or late payments of royalty, milestone and license

maintenance fees not cured within 90 days after delivery of written notice by LLU, (ii) a breach of any non-payment provision (including

the provision that requires us to meet certain deadlines for milestone events (each, a “Milestone Deadline”)) not cured within

90 days after delivery of written notice by LLU and (iii) LLU delivers notice to us of three or more actual breaches of the LLU License

Agreement by us in any 12-month period.

Additional Milestone Deadlines include:

(i) the requirement to have submission of an IND/clinical trial application

to initiate first-in-human clinical trials on or before March 31, 2022, (ii) the completion of first-in-human (phase I/II) clinical trials

by March 31, 2024, (iii) the completion of Phase III clinical trials by March 31, 2026 and (iv) biologic licensing approval by the FDA

by March 31, 2027.

License Agreement with Leland Stanford Junior

University (“Stanford”)

(i) the requirement to have regulatory approval of an

IND application to initiate first-in-human clinical trials on or before March 31, 2022, which has been extended to March 31, 2023 due

to payment of a $100,000 extension fee paid in March 2022, (ii) the completion of first-in-human (phase I/II) clinical trials by March

31, 2024, (iii) the completion of Phase III clinical trials by March 31, 2026 and (iv) biologic licensing approval by the FDA by March

License Agreement

with Leland Stanford Junior University (“Stanford”)

On February 3, 2020, we entered

into an exclusive license agreement (the “February 2020 License Agreement”) with Stanford with regard to a patent concerning

a method for detection and measurement of specific cellular responses.

Pursuant to the February 2020 License Agreement, other than as

described below, we received an exclusive worldwide license to Stanford’s patent with regard to use, import, offer, and sale of

Licensed Products (as defined in the agreement).

The license to the patented technology is exclusive, including the right to sublicense,

beginning on the effective date of the agreement and ending when the patent expires.

Under the exclusivity agreement, we acknowledged

that Stanford had already granted a non-exclusive license in the Nonexclusive Field of Use, under the Licensed Patents in the Licensed

Field of Use in the Licensed Territory (as those terms are defined in the February 2020 License Agreement”).

However, Stanford agreed

to not grant further licenses under the Licensed Patents in the Licensed Field of Use in the Licensed Territory.

On December 29, 2021,

we entered into an amendment to the February 2020 License Agreement which extended our exclusive right to license the technology deployed

in AditxtScore TM and securing worldwide exclusivity in all fields of use of the licensed technology.

We were obligated to pay and

paid a fee of $25,000 to Stanford within 60 days of February 3, 2020.

into an exclusive license agreement (the “February 2020 License Agreement”) with Stanford regarding a patent concerning a

method for detection and measurement of specific cellular responses.

Pursuant to the February 2020 License Agreement, we received an

exclusive worldwide license to Stanford’s patent regarding use, import, offer, and sale of Licensed Products (as defined in the

The license to the patented technology is exclusive, including the right to sublicense, beginning on the effective date of

the agreement, and ending when the patent expires.

Under the exclusivity agreement, we acknowledged that Stanford had already granted

a non-exclusive license in the Nonexclusive Field of Use, under the Licensed Patents in the Licensed Field of Use in the Licensed Territory

(as those terms are defined in the February 2020 License Agreement”).

However, Stanford agreed to not grant further licenses under

the Licensed Patents in the Licensed Field of Use in the Licensed Territory.

On December 29, 2021, we entered into an amendment to the

February 2020 License Agreement which extended our exclusive right to license the technology deployed in AditxtScore TM and

securing worldwide exclusivity in all fields of use of the licensed technology.

We were obligated to pay

and paid a fee of $25,000 to Stanford within 60 days of February 3, 2020.

We also issued 375 shares of the Company’s common stock

An annual licensing maintenance fee is payable by us on the first anniversary of the February 2020 License Agreement in the

amount of $40,000 for 2021 through 2024 and $60,000 starting in 2025 until the license expires upon the expiration of the patent.

Company is required to pay and has paid $25,000 for the issuances of certain patents.

The Company will pay milestone fees of $50,000 on

the first commercial sales of a licensed product and $25,000 at the beginning of any clinical study for regulatory clearance of an in

vitro diagnostic product developed and a potential licensed product.

We are also required to:

(i) provide a listing of the management

team or a schedule for the recruitment of key management positions by March 31, 2020 (which has been completed), (ii) provide a business

plan covering projected product development, markets and sales forecasts, manufacturing and operations, and financial forecasts until

at least $10,000,000 in revenue by June 30, 2020 (which has been completed), (iii) conduct validation studies by September 30, 2020 (which

has been completed), (iv) hold a pre-submission meeting with the FDA by September 30, 2020 (which has been completed), (v) submit a 510(k)

application to the FDA, Emergency Use Authorization (“EUA”), or a Laboratory Developed Test (“LDT”) by March 31,

2021 (which has been completed), (vi) develop a prototype assay for human profiling by December 31, 2021 (which has been completed), (vii)

execute at least one partnership for use of the technology for transplant, autoimmunity, or infectious disease purposes by March 31, 2022and

(viii) will provide further development and commercialization milestones for specific fields of use in writing by December 31, 2022.

In addition to the annual license

maintenance fees outlined above, we will pay Stanford royalties on Net Sales (as such term is defined in the February 2020 License Agreement)

during the of the term of the agreement as follows:

4% when Net Sales are below or equal to $5 million annually or 6% when Net Sales are

above $5 million annually.

The February 2020 License Agreement may be terminated upon our election on at least 30 days advance notice

to Stanford, or by Stanford if we:

An annual licensing maintenance fee is payable by us on the first anniversary of the February 2020 License Agreement in

the amount of $40,000 for 2021 through 2024 and $60,000 starting in 2025 until the license expires upon the expiration of the patent.

The Company is required to pay and has paid $25,000 for the issuances of certain patents.

The Company will pay milestone fees of $50,000

on the first commercial sales of a licensed product and $25,000 at the beginning of any clinical study for regulatory clearance of an

in vitro diagnostic product developed and a potential licensed product.

The Company paid a milestone fee for a clinical study for regulatory

clearance of an in vitro diagnostic product developed and a potential licensed product of $25,000 in March of 2022.

We are also required

(i) provide a listing of the management team or a schedule for the recruitment of key management positions by March 31, 2020 (which

has been completed), (ii) provide a business plan covering projected product development, markets and sales forecasts, manufacturing

and operations, and financial forecasts until at least $10,000,000 in revenue by June 30, 2020 (which has been completed), (iii) conduct

validation studies by September 30, 2020 (which has been completed), (iv) hold a pre-submission meeting with the FDA by September 30,

2020 (which has been completed), (iv) submit a 510(k) application to the FDA, Emergency Use Authorization (“EUA”), or a Laboratory

Developed Test (“LDT”) by March 31, 2021 (which has been completed), (vi) develop a prototype assay for human profiling by

December 31, 2021 (which has been completed), (vii) execute at least one partnership for use of the technology for transplant, autoimmunity,

or infectious disease purposes by March 31, 2022 (which has been completed) and (viii) provided further development and commercialization

milestones for specific fields of use in writing prior to December 31, 2022.

In addition to the annual

license maintenance fees outlined above, we will pay Stanford royalties on Net Sales (as such term is defined in the February 2020 License

Agreement) during the of the term of the agreement as follows:

4% when Net Sales are below or equal to $5 million annually or 6% when

Net Sales are above $5 million annually.

The February 2020 License Agreement may be terminated upon our election on at least 30 days

advance notice to Stanford, or by Stanford if we:

(i) are delinquent on any report or payment;

(ii) are not diligently developing and commercializing

Licensed Product;

(ii) are not diligently developing and

commercializing Licensed Product;

(iii) miss certain performance milestones;

(iv) are in breach of any provision of the February 2020 License Agreement;

(iv) are in breach of any provision of the February 2020

License Agreement;

or (v) provide any false report to Stanford.

Should any events in the preceding sentence occur, we have a thirty (30) day cure period

to remedy such violation.

December 29, 2020, the Company entered into an amendment to the February 2020 License Agreement extending the Company’s exclusive

right to license the technology deployed in AditxtScore TM and securing worldwide

exclusivity in all fields of use of the licensed technology.

We have assembled a team of

experts from a variety of scientific fields and commercial backgrounds, with many years of collective experience that ranges from founding

startup biotech companies, to developing and marketing biopharmaceutical products, to designing clinical trials, and to management of

private and public companies.

Should any events in the preceding sentence occur, we have a thirty (30)

day cure period to remedy such violation.

have assembled a team of experts from a variety of scientific fields and commercial backgrounds, with many years of collective experience

that ranges from founding startup biotech companies, to developing and marketing biopharmaceutical products, to designing clinical trials,

and to management of private and public companies.

Going Concern

We were incorporated on September

28, 2017 and have not generated significant revenues to date.

During the year ended December 31, 2021 we had a net loss of $46,371,364

and cash of $7,872,061.

The Company will require significant additional capital to operate in the normal course of business and fund clinical

studies in the long-term.

As a result of the January 2021 Securities Purchase Agreement, the August 2021 Offering, the October 2021 Offering,

and the December 2021 Offering we received net proceeds of approximately $35,000,000 during the last twelve months.

We believe that the

funds raised will not be sufficient to fund our operations for the next 12 months and such creates substantial doubt about our ability

to continue as a going concern beyond one year.

were incorporated on September 28, 2017 and have not generated significant revenues to date.

During the year ended December 31, 2022,

we had a net loss of $27,649,876 and cash of $2,768,640 as of December 31, 2022.

The Company will require significant additional capital

to operate in the normal course of business and fund clinical studies in the long-term.

As a result of the May 2022 purchase and sale

of future receipts (a “Future Receipts Agreement”), the August 2022 Senior Secured Convertible Note, the August 2022 Future

Receipts Agreement and the September 2022 public offering we received net proceeds of approximately $21,000,000 during the last twelve

We believe that the remaining funds on hand will not be sufficient to fund our operations for the next 12 months and such creates

substantial doubt about our ability to continue as a going concern beyond one year.

Financial Results

We have a limited operating

Therefore, there is limited historical financial information upon which to base an evaluation of our performance.

Our prospects

must be considered in light of the uncertainties, risks, expenses, and difficulties frequently encountered by companies in their early

stages of operations.

have a limited operating history.

Therefore, there is limited historical financial information upon which to base an evaluation of our

Our prospects must be considered in light of the uncertainties, risks, expenses, and difficulties frequently encountered

by companies in their early stages of operations.

Our financial statements as of December 31, 2022, show a net loss of $27,649,876.

We expect to incur additional

net expenses over the next several years as we continue to maintain and expand our existing operations.

The amount of future losses and

when, if ever, we will achieve profitability are uncertain.

On July 2, 2020, we completed

In connection therewith, we issued 1,226,668 Units, excluding the underwriters’ overallotment, at an offering price of $9.00

per Unit, resulting in gross proceeds of approximately $11.0 million.

The Units issued in the IPO consisted of one share of common stock,

one Series A warrant, and one Series B warrant.

The Series A warrants originally had an exercise price of $9.00 and a term of 5 years.

In addition, the Company issued a Unit Purchase Option at an exercise price of $11.25 per unit to the underwriters to purchase up to 67,466

units, with each unit consisting of (i) one share of common stock and (ii) one Series A Warrant.

On August 19, 2020 the Company modified

the exercise price of the Series A Warrants from $9.00 per share to $4.50 per share.

The term of the Series A Warrants was not modified.

The Series B warrants have an exercise price of $11.25 per share and a term of 5 years.

Substantially all of the Series B warrants issued

in the IPO as part of the Units have been exercised pursuant to a cashless provision therein.

On September 10, 2020, we completed

a follow-on public offering (“September 2020 Offering”).

In connection therewith, we issued 2,400,000 units, or Follow-On

Units, excluding the underwriters’ option to cover overallotments, at an offering price of $4.00 per Follow-On Unit, resulting in

gross proceeds to the Company of approximately $9.6 million.

Each of the Follow-On Units issued in the September 2020 Offering consisted

of one share of common stock or Series A Preferred Stock for investors who would own more than 4.99% of the Company if they invested in

common stock, one Series A-1 warrant, and one Series B-1 warrant.

The Series A-1 warrants have an exercise price of $3.19 per share and

a term of 5 years.

The Series B-1 warrants have exercise price of $5.00 per share, a term of 5 years and contain a cashless exercise option

upon certain criteria being met.

In addition, the Company issued a warrant to the underwriters to purchase up to 60,000 shares of common

stock at an exercise price of $5.00 per share.

August 31, 2021, the Company completed a registered direct offering (“August 2021 Offering”).

In connection therewith, the

Company issued 4,583,334 shares of common stock, at a purchase price of $2.40 per share, resulting in gross proceeds of

approximately $11.0 million.

In a concurrent private placement, the Company issued warrants to purchase up to 4,583,334 shares.

The warrants have an exercise price of $2.53 per share and are exercisable for a five-year period commencing six months

from the date of issuance.

The warrants exercise price was subsequently repriced to $1.50.

In addition, the Company issued a warrant to

the placement agent to purchase up to 229,166 shares of common stock at an exercise price of $3.00 per share.

October 18, 2021, the Company entered into an underwriting agreement with Revere Securities LLC, relating to the public offering (the

“October Offering”) of 2,833,333 shares of the Company’s common stock (the “Shares”) by the Company.

The Shares were offered, issued, and sold at a price to the public of $1.50 per share under a prospectus supplement and accompanying

prospectus filed with the SEC pursuant to an effective shelf registration statement filed with the SEC on Form S-3 (File No.

which was declared effective by the SEC on July 13, 2021.

The October Offering closed on October 20, 2021 for gross proceeds of $4.25 million.

The Company utilized a portion of the proceeds, net of underwriting discounts of approximately $3.91 million from the October Offering

to fund certain obligations under the Credit Agreement.

On December 1, 2021, the Company

entered into an underwriting agreement with Dawson James Securities, Inc., as representative of the several underwriters identified therein,

relating to the public offering by the Company of 16,575,000 units (the “Units”), with each unit comprised of one share of

the Company’s common stock (the “Shares”) and one Series C warrant to purchase one Share at an exercise price of $1.15

per share (the “Series C Warrants”).

December 6, 2021, the Company completed the offering for net proceeds of $16.0 million.

As part of this offering, we issued 8,246,430

units consisting of shares of the Company’s common stock and one warrant to purchase one share of the Company’s common stock

and 8,328,570 prefunded warrants.

The warrant issued as part of the units had an exercise price of $1.15 and the prefunded warrants had

an exercise price of $0.001.

expect to incur additional net expenses over the next several years as we continue to maintain and expand our existing operations.

amount of future losses and when, if ever, we will achieve profitability are uncertain.

Results of Operations

Results of operations for the year ended

December 31, 2021

During the year ended December

31, 2021, we incurred a loss from operations of $41,961,983.

This is due to general and administrative expenses of $22,084,389, which

includes $3,927,551 in stock-based compensation, research and development of $5,042,617, which includes $713,130 in stock-based compensation,

sales and marketing expenses of $334,977, and impairment on note receivable of $14,500,000.

The $5,042,617 in research and development

is comprised of $76,455 in licensing fees, $1,960,196 in product development, $2,039,533 in compensation, and $966,433 in other research

and development expense.

During the year ended December

31, 2020, we incurred a loss from operations of $8,872,209.

This is due to general and administrative expenses of $7,852,256, which includes

$3,188,840 in stock-based compensation, research and development of $937,966, and sales and marketing expenses of $81,987.

in research and development is comprised of $258,635 in licensing fees, $519,171 in product development, and $160,160 in other research

and development expense.

The increase in expenses during

the year ended December 31, 2021 compared to the year ended December 31, 2020 was due to the Company continuing to execute its business

plan and incur costs of being a public company.

Liquidity and Capital Resources

of operations for the years ended December 31, 2022 and 2021

generated revenue of $933,715 and $105,034 for the years ended December 31, 2022 and 2021, respectively.

Cost of sales for the years

ended December 31, 2022 and 2021 was $766,779 and $77,979, respectively.

the years ended December 31, 2022, we incurred a loss from operations of $25,480,098.

This is due to general and administrative expenses

of $15,985,552, which includes $1,516,805 in stock-based compensation, research and development of $7,268,084, which includes $591,518

in stock-based compensation, sales and marketing expenses of $1,849,460, which includes $1,023,045 in stock-based compensation and impairment

on note receivable of $534,938.

The $7,268,084 in research and development is mainly comprised of $2,145,382 in consulting expenses,

and $3,375,757 in compensation offset by a one-time adjustment to research and development purchases.

During the year, the Company transitioned

from purchasing certain inventory items to internally manufacturing these items.

the year ended December 31, 2021, we incurred a loss from operations of $41,934,928.

This is due to general and administrative expenses

of $22,084,389, which includes $3,927,551 in stock-based compensation, research and development of $5,042,617, which includes $713,130

in stock-based compensation, sales and marketing expenses of $334,977, and impairment on note receivable of $14,500,000.

The $5,042,617

in research and development is comprised of $76,455 in licensing fees, $1,960,196 in product development, $2,039,533 in compensation,

and $966,433 in other research and development expense.

decrease in expenses during the year ended December 31, 2022 compared to the year ended December 31, 2021 was due to the impairment on

note receivable during the year ended December 31, 2021.

Liquidity and Capital

have incurred substantial operating losses since inception and expect to continue to incur significant operating losses for the foreseeable

future and may never become profitable.

As of December 31, 2021, we had an accumulated deficit of $67,352,809.

We had working capital

As of December 31, 2022, we had an accumulated deficit of $95,040,362 We had working capital

of $1,099,839 as of December 31, 2022.

During the year ended December 31, 2021, we purchased $1,837,615 in fixed assets, for which we

made cash payments of $1,015,752 and financed $821,863.

These fixed assets were purchased to continue the buildout of our operations.

Purchases of fixed assets consisted of, $1,489,594 for lab equipment, $257,910 for computers, $80,350 for office furniture, and $9,761

for other fixed assets.

We made loans of $15,000,000 during 2021 related to potential acquisition

of which $14,500,000 is believed to be impaired.

During year ended December 31, 2022, we purchased $367,079 in fixed assets.

These fixed assets

were purchased to continue the buildout of our operations.

Approximately $300,000 of purchased fixed assets were lab equipment, $62,000

were computers, and $5,000 were office furniture.

financial statements have been prepared assuming that we will continue as a going concern.

have funded our operations from proceeds from the sale of equity and debt securities.

4 unchanged sentences

September 10, 2020, we completed a follow-on public offering.

In connection therewith, we issued 2,400,000 units, or Follow-On Units,

excluding the underwriters’ option to cover overallotments, at an offering price of $4.00 per Follow-On Unit, resulting in gross

proceeds of approximately $9.6 million.

January 25, 2021, the Company entered into a securities purchase agreement with an institutional accredited investor (the “Investor”)

In connection therewith, we issued 48,000 units, or Follow-On Units, excluding

the underwriters’ option to cover overallotments, at an offering price of $200.00 per Follow-On Unit, resulting in gross proceeds

of approximately $9.6 million.

January 25, 2021, we entered into a securities purchase agreement with an institutional accredited investor (the “Investor”)

for the sale of a $6,000,000 senior secured convertible note (the “Convertible Note”).

1 unchanged sentence

24 months, was originally convertible at a price of $200.00 per share and was issued at an original issuance discount of $1,000,000.

August 30, 2021, the Company entered into a defeasance and waiver agreement with the Investor, pursuant to which the Noteholder has agreed

in exchange for (a) a cash payment by the Company to the Investor of $1.2 million (the Cash Payment”), (b) a waiver, in part of

the conversion price adjustment provision such that the January 2021 Note shall be convertible into 4,802,497 shares of common stock (without

giving effect to the conversion notice received by the company form the Noteholder prior to the date hereof totaling (1,005,748 shares)

(the “Shares”), and (c) a voluntary and permanent reduction by the Company of the exercise price of the warrant to purchase

800,000 shares of the common stock of the Company (the “January 2021 Warrant”) to $2.53 per share.

As of September 30, 2021,

the outstanding principle of the convertible note had been converted to 4,802,497 shares of common stock.

August 31, 2021, we completed a registered direct offering and raised approximately $10.1 million in net proceeds.

On August 30, 2021, the Company entered into a defeasance and waiver agreement with the Investor, pursuant to which the Investor has

agreed in exchange for (a) a cash payment by the Company to the Investor of $1.2 million (the Cash Payment”), (b) a waiver, in

part of the conversion price adjustment provision such that the January 2021 Note shall be convertible into 96,050 shares of common stock

(without giving effect to the conversion notice received by the Company from the Investor prior to the date hereof totaling (20,115 shares),

and (c) a voluntary and permanent reduction by the Company of the exercise price of the warrant to purchase 16,000 shares of the common

stock of the Company (the “January 2021 Warrant”) to $126.50 per share.

As of December 31, 2022, the outstanding principle

of the convertible note had been converted to 96,050 shares of common stock.

August 30, 2021, we completed a registered direct;

offering and raised approximately $10.1 million in net proceeds.

October 20, 2021, we completed an offering for net proceeds of $3.8 million.

As part of this offering, we issued 2,833,333 shares

of the Company’s common stock

As part of this offering, we issued 56,667 shares of the

Company’s common stock.

December 6, 2021, we completed an offering for net proceeds of $16.0 million.

As part of this offering, we issued 8,246,430 units

consisting of shares of the Company’s common stock and warrant to purchase shares of the Company’s common stock and 8,328,570

prefunded warrants.

The warrant issued as part of the units had an exercise price of $1.15 and the prefunded warrants had an exercise

price of $0.001.

As part of this offering, we issued 164,929 units consisting

of shares of the Company’s common stock and warrant to purchase shares of the Company’s common stock and 166,572 prefunded

The warrant issued as part of the units had an exercise price of $57.50 and the prefunded warrants had an exercise price of

September 20, 2022, we completed a public offering for net proceeds of $17.2 million (the “September 2022 Offering”).

As part of the September 2022 Offering, we issued 1,224,333 of shares of the Company’s common stock, pre-funded warrants to

purchase 2,109,000 shares of the Company’s common stock and warrants to purchase 3,333,333 shares of the Company’s common

The warrants had an exercise price of $6.00 and the pre-funded warrants had an exercise price of $0.001.

may need to raise significant additional capital to continue to fund our operations and the clinical trials for our product candidates.

13 unchanged sentences

including our clinical trials.

As we may need to raise funds in the future, we do not believe the current cash reserves are sufficient

to fund our operations for the foreseeable future.

While we may need to raise funds in the future, we believe the current cash reserves should be sufficient

to fund our operation for the foreseeable future.

Because of these factors, we believe that this creates doubt about our ability to continue

5 unchanged sentences

Total contractual obligations

Critical Accounting Polices and Estimates

Our financial statements are

prepared in accordance with generally accepted accounting principles in the United States.

The preparation of our financial statements

and related disclosures requires us to make estimates, assumptions and judgments that affect the reported amount of assets, liabilities,

revenue, costs and expenses, and related disclosures.

We believe that of our critical accounting policies described under the heading

“Management’s Discussion and Analysis of Financial Condition and Plan of Operations—Critical Accounting Policies”

in our Prospectus, dated September 1, 2020, filed with the SEC pursuant to Rule 424(b), are critical to fully understanding and evaluating

our financial condition and results of operations.

Critical Accounting

Polices and Estimates

financial statements are prepared in accordance with generally accepted accounting principles in the United States.

The preparation of

our financial statements and related disclosures requires us to make estimates, assumptions and judgments that affect the reported amount

of assets, liabilities, revenue, costs and expenses, and related disclosures.

We believe that our critical accounting policies described

under the heading “Management’s Discussion and Analysis of Financial Condition and Plan of Operations—Critical Accounting

Policies” in our Prospectus, dated September 1, 2020, filed with the SEC pursuant to Rule 424(b), are critical to fully understanding

and evaluating our financial condition and results of operations.

The following involve the most judgment and complexity:

Research and development

Stock-based compensation expense

Fair value of common stock

Accordingly, we believe the

policies set forth above are critical to fully understanding and evaluating our financial condition and results of operations.

results or events differ materially from the estimates, judgments and assumptions used by us in applying these policies, our reported

financial condition and results of operations could be materially affected.

Off-Balance Sheet Arrangements

We did not have during the

periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.

On April 5, 2012, the

JOBS Act was enacted.

Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the

extended transition period provided in Section 7(a)(2)(B) of the Securities Act, for complying with new or revised accounting standards.

In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards

would otherwise apply to private companies.

We have chosen to take advantage

of the extended transition periods available to emerging growth companies under the JOBS Act for complying with new or revised accounting

standards until those standards would otherwise apply to private companies provided under the JOBS Act.

We are in the process of evaluating

the benefits of relying on other exemptions and reduced reporting requirements provided by the JOBS Act.

Subject to certain

conditions set forth in the JOBS Act, as an “emerging growth company,” we intend to rely on certain of these exemptions, including

without limitation, (i) providing an auditor’s attestation report on our system of internal controls over financial reporting

pursuant to Section 404(b) of the Sarbanes-Oxley Act and (ii) complying with any requirement that may be adopted by the Public

Company Accounting Oversight Board (“PCAOB”) regarding mandatory audit firm rotation or a supplement to the auditor’s

report providing additional information about the audit and the financial statements, known as the auditor discussion and analysis.

will remain an “emerging growth company” until the earliest of (i) the last day of the fiscal year in which we have total

annual gross revenues of $1.07 billion or more;

(ii) the last day of our fiscal year following the fifth anniversary of the

date of the completion of this offering;

(iii) the date on which we have issued more than $1 billion in nonconvertible debt

during the previous three years;

or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the Securities

and Exchange Commission.

Recently Issued and Adopted Accounting Pronouncements

See Note 3 - Summary of Significant

Accounting Policies to the accompanying financial statements for a description of other accounting policies and recently issued accounting

pronouncements.

and development

● Stock-based

compensation expense

we believe the policies set forth above are critical to fully understanding and evaluating our financial condition and results of operations.

If actual results or events differ materially from the estimates, judgments and assumptions used by us in applying these policies, our

reported financial condition and results of operations could be materially affected.

Off-Balance Sheet

time to time the Company enters short term research and development contracts.

These contracts have payment provisions which require payment

once regulatory and completion milestones are met.

As of December 31, 2022, the Company has approximately $1.6 million outstanding, subject

to these milestones.

April 5, 2012, the JOBS Act was enacted.

Section 107 of the JOBS Act provides that an “emerging growth company”

can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act, for complying with new

or revised accounting standards.

In other words, an “emerging growth company” can delay the adoption of certain accounting

standards until those standards would otherwise apply to private companies.

favorable, we have chosen to take advantage of the extended transition periods available to emerging growth companies under the JOBS

Act for complying with new or revised accounting standards until those standards would otherwise apply to private companies provided

under the JOBS Act.

are in the process of evaluating the benefits of relying on other exemptions and reduced reporting requirements provided by the JOBS Act.

to certain conditions set forth in the JOBS Act, as an “emerging growth company,” we intend to rely on certain of these exemptions,

including without limitation, (i) providing an auditor’s attestation report on our system of internal controls over financial

reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act and (ii) complying with any requirement that may be adopted

by the Public Company Accounting Oversight Board (“PCAOB”) regarding mandatory audit firm rotation or a supplement to the

auditor’s report providing additional information about the audit and the financial statements, known as the auditor discussion

and analysis.

We will remain an “emerging growth company” until the earliest of (i) the last day of the fiscal year

in which we have total annual gross revenues of $1.07 billion or more;

(ii) the last day of our fiscal year following the fifth

anniversary of the date of the completion of our IPO (December 31, 2025);

(iii) the date on which we have issued more than $1 billion

in nonconvertible debt during the previous three years;

or (iv) the date on which we are deemed to be a large accelerated filer

under the rules of the SEC.

Recently Issued and

Adopted Accounting Pronouncements

Note 3 - Summary of Significant Accounting Policies to the accompanying financial statements for a description of other accounting policies

and recently issued accounting pronouncements.

Recent Developments

Note 12 – Subsequent Event to the accompanying financial statements for a description of material recent developments.

Quantitative and Qualitative Disclosures

5 unchanged sentences

following the Exhibit Index of this Annual Report on Form 10-K.

Changes in and Disagreements with Accountants

on Accounting and Financial Disclosure.

Changes in and Disagreements with

Accountants on Accounting and Financial Disclosure.

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-K

Item 7. Management’s Discussion and Analysis