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Item 1. Financial Statements

2022-05-13 compared with 2021-11-12 · 221 added, 216 removed, 265 unchanged (62% of the section changed)

2 unchanged sentences

Balance Sheets

September 30,

Current Assets:

3 unchanged sentences

Noncurrent Assets:

Prepaid expenses, net of current portion

Property and equipment, net

11 unchanged sentences

Preferred stock, $ 0.001 par value, 5,000,000 shares authorized and 0 shares issued and outstanding

Common stock, $ 0.001 par value, 75,000,000 shares authorized and 27,460,735 and

23,856,151 shares issued and outstanding, respectively

Common stock, $ 0.001 par value, 75,000,000 shares authorized and 40,032,481

and 27,927,217 shares issued and outstanding, respectively

Additional paid-in capital

4 unchanged sentences

Total Liabilities and Stockholders' Equity

See accompanying notes to the unaudited financial statements.

See accompanying notes to the unaudited financial

CNS Pharmaceuticals, Inc.

Statements of Operations

September 30,

Three Months Ended March 31, 2022

Three Months Ended March 31, 2021

Operating expenses:

5 unchanged sentences

( 3,609,657 )

( 11,234,378 )

( 6,452,966 )

Other expenses:

3 unchanged sentences

$ ( 3,613,404 )

$ ( 11,241,425 )

$ ( 6,452,966 )

Loss per share - basic and diluted

Weighted average shares outstanding - basic and diluted

See accompanying notes to the unaudited financial statements.

Pharmaceuticals, Inc.

Statements of

Stockholders' Equity

For the three and nine months ended September 30, 2021 and 2020

See accompanying notes to the unaudited financial

CNS Pharmaceuticals, Inc.

Statements of Stockholders’

For the three months ended March 31, 2022 and

Stockholders'

8 unchanged sentences

$ ( 37,767,260 )

Common stock issued for cash and subscription receivable, net

Stock-based compensation

( 3,813,673 )

Balance June 30, 2021

( 28,373,420 )

Stock-based compensation

( 3,814,348 )

Balance September 30, 2021

$ ( 32,187,768 )

Balance December 31, 2020

$ ( 20,946,343 )

Common stock issued for cash, net

Exercise of warrants

Stock-based compensation

3 unchanged sentences

$ ( 24,559,747 )

Stock-based compensation

( 2,473,771 )

Balance June 30, 2020

( 15,930,374 )

Common stock issued for deferred offering costs

Stock-based compensation

( 2,011,064 )

Balance September 30, 2020

$ ( 17,941,438 )

See accompanying notes to the unaudited

financial statements.

See accompanying notes to the unaudited financial

CNS Pharmaceuticals, Inc.

Statements of Cash Flows

Nine Months Ended September 30, 2021

Nine Months Ended September 30, 2020

Three Months Ended March 31, 2022

Three Months Ended March 31, 2021

Cash Flows from Operating Activities:

4 unchanged sentences

Changes in operating assets and liabilities:

Related party receivable

Prepaid expenses

( 1,373,257 )

Accounts payable

Accounts payable and accrued expenses - related party

( 1,033,107 )

Accrued expenses

6 unchanged sentences

Cash Flows from Financing Activities:

Payment of deferred offering cost

Payments on notes payable

Proceeds from exercise of warrants

Proceeds from sale of common stock, net

Net cash provided by (used in) financing activities

Proceeds from sale of common stock

Net cash provided by financing activities

Net change in cash and cash equivalents

( 2,964,293 )

( 5,934,190 )

Cash and cash equivalents, at beginning of period

5 unchanged sentences

Cashless exercise of warrants

Common stock issued for deferred offering costs

See accompanying notes to the unaudited financial statements.

See accompanying notes to the unaudited financial

CNS Pharmaceuticals, Inc.

5 unchanged sentences

of anti-cancer drug candidates.

Note 2 – Summary of Significant Accounting Policies

Note 2 – Summary of Significant Accounting

Basis of Presentation - The accompanying unaudited financial

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financial statements not misleading.

Operating results for the nine months ended September 30, 2021 are not necessarily indicative of

the final results that may be expected for the year ending December 31, 2021.

For more complete financial information, these unaudited

financial statements should be read in conjunction with the audited financial statements for the period ended December 31, 2020 included

in our Form 10-K filed with the SEC on February 12, 2021 (“Form 10-K”).

Notes to the financial statements which would substantially

duplicate the disclosures contained in the audited financial statements for the most recent fiscal period, as reported in the Form 10-K,

have been omitted.

Operating results for the three months ended March 31, 2022 are not necessarily indicative of the

final results that may be expected for the year ending December 31, 2022.

For more complete financial information, these unaudited financial

statements should be read in conjunction with the audited financial statements for the period ended December 31, 2021 included in our

Form 10-K filed with the SEC on March 3, 2022 (“Form 10-K”).

Notes to the financial statements which would substantially duplicate

the disclosures contained in the audited financial statements for the most recent fiscal period, as reported in the Form 10-K, have been

Liquidity and Going Concern - These financial statements have

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The amount in excess

of the FDIC insurance as of September 30, 2021 was $ 8,076,223 .

The Company has not experienced losses on these accounts and management

believes, based upon the quality of the financial institutions, that the credit risk with regard to these deposits is not significant.

of the FDIC insurance as of March 31, 2022 was $ 12,190,498 .

The Company has not experienced losses on these accounts and management believes,

based upon the quality of the financial institutions, that the credit risk with regard to these deposits is not significant.

Loss Per Common Share - Basic loss per common share is computed

4 unchanged sentences

excludes common stock equivalents, because their inclusion would be anti-dilutive.

For the nine months ended September 30, 2021, the Company’s

potentially dilutive shares and options, which were not included in the calculation of net loss per share, included warrants to purchase

5,130,240 common shares, and options for 2,939,736 common shares.

For the nine months ended September 30, 2020, the Company’s potentially

dilutive shares and options, which were not included in the calculation of net loss per share warrants to purchase 3,986,630 common shares,

and options for 2,220,736 common shares.

For the three months ended March 31, 2022 and 2021,

the Company’s potentially dilutive shares and options, which were not included in the calculation of net loss per share, included

warrants to purchase 16,925,504 and 5,130,240 common shares, and options for 2,864,736 and 2,736,736 common shares, respectively.

Note 3 – Note Payable

8, 2021, the Company entered into a short-term note payable for an aggregate of $ 425,990 , bearing interest at 3.3 % per year to finance

certain insurance policies.

Principal and interest payments related to the note will be repaid over a 11-month period with the final

payment due on September 30, 2022 .

As of March 31, 2022 and December 31, 2021, the Company’s note payable balance was $ 272,572

and $ 387,794 , respectively.

Note 4 – Equity

In January 2021, the Company entered into a twelve-month agreement with

an investor relations firm that includes the issuance of 25,000 restricted shares of common stock.

Upon signing the agreement, 6,250 shares

vested immediately, and the remaining 18,750 shares will vest quarterly over the remainder of the agreement.

The Company may terminate

the agreement at any time during the twelve-month period with a fifteen-day notice.

During the nine months ended September 30, 2021,

the Company issued 18,750 common shares and recognized $ 37,875 of stock-based compensation related to the agreement and will issue the

remaining shares over the service period.

During the nine months ended September 30, 2021, the Company issued

75,000 shares of common stock and recognized $ 140,250 of expense for investor relations services for a four month period ending September

On February 12, 2021, the Company entered into a Capital on Demand™

Sales Agreement (the “Agreement”) with JonesTrading Institutional Services LLC and Brookline Capital Markets, a division of

Arcadia Securities, LLC (collectively, the “Agent”).

Pursuant to the terms of the Agreement, the Company may sell from time

to time, through the Agent, shares of the Company’s common stock with an aggregate sales price of up to $20.0 million.

During the nine months ended September 30, 2021, the Company sold 2,063,059

shares of common stock to the Agent for net proceeds of $ 4,653,821 .

Company engaged H.C.

Wainwright & Co., LLC (“Wainwright”), to act as placement agent related to the Securities

Purchase Agreement described below.

The Company agreed to pay Wainwright an aggregate fee equal to 7.0% of the gross proceeds

received by the Company from the sale of the securities in the transaction.

The Company will also issue to Wainwright or its

designees warrants to purchase up to 5.0% of the aggregate number of shares of Common Stock sold in the transactions (the

“Placement Agent Warrants”), or 605,263

Placement Agent Warrants.

The Placement Agent Warrants have substantially the same terms as the Common Warrants, except that the

Placement Agent Warrants have an exercise price equal to 125% of the offering price, or $1.1875 per share.

The Company also paid

Wainwright $ 50,000 for non-accountable

expenses and $ 10,000 for

legal fees and expenses.

On January 5, 2022, the Company entered

into a Securities Purchase Agreement (the “Purchase Agreement”) with several institutional investors for the sale by the

Company of (i) 9,489,474 shares (the “Shares”) of the Company’s common stock, (ii) pre-funded warrants (the

“Pre-Funded Warrants”) to purchase up to an aggregate of 2,615,790 shares of common stock and (iii) warrants to

purchase up to an aggregate of 12,105,264 shares of common stock (the “Common Warrants” and, collectively with the

Pre-Funded Warrants, the “Warrants”), in a private placement offering.

The combined purchase price of one share of

common stock (or one Pre-Funded Warrant) and the accompanying Common Warrant is $0.95.

Subject to certain ownership limitations, the Warrants are exercisable

upon issuance.

Each Pre-Funded Warrant is exercisable into one share of common stock at a price per share of $ 0.001 (as adjusted from

time to time in accordance with the terms thereof).

Each Common Warrant is exercisable into one share of common stock at a price per share

of $ 0.82 (as adjusted from time to time in accordance with the terms thereof) and will expire on the fifth anniversary of the date of

The gross proceeds from the Purchase Agreement were $ 11,497,385 resulting in net proceeds, after payment of commissions and

expenses, received by the Company of $ 10,625,786 .

Stock Options

11 unchanged sentences

purchase more than 750,000 shares of common stock) in a single year.

the nine months ended September 30, 2021, the Board of Directors approved grants of 739,000

options to officers, employees, board of directors and a consultant.

The exercise price of the options ranges from $ 1.80

and the options expire ten-years following issuance.

fair value of these option grants at issuance was $ 1,969,712 .

Of the 739,000 options issued, 128,000

options vest on the first anniversary date of issuance, 75,000

options have a vesting term of 25% vest upon issuance, 50% vest upon Board approving a business development acquisition and 25% vest

over a three year period in equal installments on each of the succeeding three anniversary dates.

The remaining options issued vest in

four equal annual installments beginning on the first anniversary following issuance.

the nine months ended September 30, 2021 and 2020, the Company recognized $ 1,228,811 and $ 930,443 of stock-based compensation,

respectively, related to outstanding stock options.

At September 30, 2021, the Company had $ 2,999,404 of unrecognized expenses

related to outstanding options.

The following table summarizes the stock option activity for the nine

months ended September 30, 2021:

During the three months ended March 31, 2022 and 2021, the Company

recognized $ 336,685 and $ 418,053 of stock-based compensation, respectively, related to outstanding stock options.

At March 31, 2022, the

Company had $ 2,222,762 of unrecognized expenses related to outstanding options.

The following table summarizes the stock option

activity for the three months ended March 31, 2022:

Schedule of Stock Option Activity

1 unchanged sentence

Outstanding, December 31, 2021

Outstanding, September 30, 2021

Exercisable, September 30, 2021

of September 30, 2021, the outstanding stock options have a weighted average remaining term of 8.04 years

and the aggregate intrinsic value of options vested and outstanding were $ 370,281 and

$ 397,375 respectively.

As of September 30, 2021, there are no awards

Outstanding, March 31, 2022

Exercisable, March 31, 2022

As of March 31, 2022, the outstanding stock options have a

weighted average remaining term of 7.52 years

and the aggregate intrinsic value of options vested and outstanding were $ 81,400 .

As of March 31, 2022, there were 60,500 awards

remaining to be issued under the 2017 Plan and 2,074,764 awards

1 unchanged sentence

Stock Warrants

During the nine months ended September 30, 2021, the Company received

During the three months ended March 31, 2022, the Company received

$ 2,616 in cash proceeds from the exercise of 2,615,790 warrants previously issued at an exercise price of $ 0.001 .

In addition, the Company

received notices to exercise 1,580,140 warrants on a cashless basis resulting in issuance of 1,296,075 shares of common stock.

The following table summarizes the stock warrant activity for the nine

months ended September 30, 2021:

following table summarizes the stock warrant activity for the three months ended March 31, 2022 :

Schedule of warrants activity

1 unchanged sentence

Outstanding, December 31, 2021

( 1,731,390 )

Outstanding, September 30, 2021

Exercisable, September 30, 2021

As of September 30, 2021 the outstanding and exercisable warrants have

a weighted average remaining term of 3.02 years and have an aggregate intrinsic value of $ 738,793 .

Outstanding, March 31, 2022

Exercisable, March 31, 2022

As of March 31, 2022, the outstanding and exercisable warrants have

a weighted average remaining term of 4.26 years and have no aggregate intrinsic value.

Note 5 – Commitments and Contingencies

45 unchanged sentences

Downs’ 2021 annual base salary

to $ 340,000 .

Scientific Advisory Board

July 15, 2021, our compensation committee recommended to our Board and our Board approved the following policy for the Scientific Advisory

Board members.

2021, our compensation committee recommended to our Board and our Board approved the following policy for the Scientific Advisory Board

The Scientific Advisory board consists of Dr.

Priebe, a significant shareholder and related party, and Dr.

Each scientific advisory board member shall receive annual

cash compensation of $68,600.

As of September 30, 2021, the Company has accrued $ 28,767

Waldemar Priebe, a significant shareholder and related party, and Dr.

Each scientific advisory board member shall receive annual cash compensation of $68,600.

During the three month months ended March 31,

2022, the Company paid $ 48,684 related to the Scientific Advisory Board compensation.

As of March 31, 2022, the Company has accrued $ 48,684

related to the Scientific Advisory Board compensation.

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Waldemar Priebe, our founder

and largest shareholder.

Pursuant to this agreement, the Company obtained a worldwide exclusive license to the chemical compound commonly

known as WP744.

and significant shareholder.

Pursuant to this agreement, the Company obtained a worldwide exclusive license to the chemical compound

commonly known as WP744.

In exchange for these rights, the Company agreed to pay consideration to HPI as follows:

(i) a royalty of 2% of net sales

of any product utilizing WP744 for a period of ten years after the first commercial sale of such;

and (ii) $100,000 upon beginning Phase

II clinical trials;

and (iii) $200,000 upon the approval by the FDA of a New Drug Application for any product utilizing WP744;

a series of quarterly development payments totaling $750,000 beginning immediately after the Company’s raise of $7,000,000 of investment

In addition, the Company issued 200,000 shares of the Company’s common stock valued at $0.045 per share to HPI upon execution

of the agreement.

Our rights pursuant to the HPI License are contingent on us raising at least $7.0 million within 12 months from the

effective date of the HPI License, a date which was extended by an additional 12 months by the payment of $40,000.

On November 13, 2019,

the Company closed its IPO and as a result completed the acquisition of the intellectual property discussed in the HPI agreement.

to this agreement, the Company purchased $385,000 of pharmaceutical products from HPI for the manufacturing of Berubicin API in a related

party transaction reviewed and approved by the Company’s audit committee.

During the nine months ended September 30, 2021 and

2020, the Company recognized $ 262,500 and $ 150,000 , respectively related to this agreement.

As of September 30, 2021, the Company accrued

$ 100,000 related to the beginning of Phase II clinical trials.

Subsequent to September 30, 2021, the Company committed to purchase additional

materials to be used in future drug manufacturing from HPI with an estimated cost of $85,000.

30, 2018, we entered into a sublicense agreement with WPD Pharmaceuticals, Inc.

Pursuant to the agreement, the Company

granted WPD an exclusive sublicense, even as to us, for the patent rights we licensed pursuant to the HPI License within the following

Poland, Estonia, Latvia, Lithuania, Belarus, Ukraine, Moldova, Romania, Bulgaria, Serbia, Macedonia, Albania, Armenia, Azerbaijan,

Georgia, Montenegro, Bosnia, Croatia, Slovenia, Slovakia, Czech Republic, Hungary, Chechnya, Uzbekistan, Kazakhstan, Kyrgyzstan, Tajikistan,

Turkmenistan, Greece, Austria, and Russia.

The sublicense agreement provides that WPD must use commercially reasonable development efforts

to attempt to develop and commercialize licensed products in the above mentioned territories, which means the expenditure of at least

$2.0 million on the development, testing, regulatory approval or commercialization of the licensed products during the three year period

immediately following the date of the sublicense agreement.

In the event that WPD fails to use commercially reasonable development efforts

by the foregoing three-year deadline, we have the right to terminate this sublicense agreement.

The Company is currently validating WPD

expenditures related to this agreement.

In consideration for the rights granted under the sublicense agreement, to the extent we are

required to make any payments to HPI pursuant to the HPI License as a result of this sublicense agreement, WPD agreed to advance us such

payments, and to pay us a royalty equal to 1% of such payments.

WPD is a Polish corporation that is majority-owned by an entity controlled

(i) a royalty of 2%

of net sales of any product utilizing WP744 for a period of ten years after the first commercial sale of such;

and (ii) $100,000 upon

beginning Phase II clinical trials (paid in 2021);

and (iii) $200,000 upon the approval by the FDA of a New Drug Application for any

product utilizing WP744;

and (iv) a series of quarterly development payments totaling $750,000 beginning immediately after the Company’s

raise of $7,000,000 of investment capital.

In addition, the Company issued 200,000 shares of the Company’s common stock valued

at $0.045 per share to HPI upon execution of the agreement.

On November 13, 2019, the Company closed its IPO, thereby fulfilling all

conditions precedent and completing the acquisition of the intellectual property discussed in the HPI agreement.

During the three months

ended March 31, 2022 and 2021, the Company recognized $ 87,500

related to this agreement.

Unrelated to this agreement, from time to time, the Company purchases pharmaceutical products from

HPI which are necessary for the manufacturing of Berubicin API and drug product in related party transactions which are reviewed and

approved by the Company’s audit committee based upon the standards of providing superior pricing and time to delivery than that

available from unrelated third parties.

During the three months ended March 31, 2022 and 2021, the Company expensed $ 41,075

and $ 385,000

respectively related to the purchase of pharmaceutical products from HPI.

On August 30, 2018, we entered into a sublicense agreement with WPD

Pharmaceuticals, Inc.

Pursuant to the agreement, the Company granted WPD an exclusive sublicense, even as to us,

for the patent rights we licensed pursuant to the HPI License within the following countries:

Poland, Estonia, Latvia, Lithuania, Belarus,

Ukraine, Moldova, Romania, Bulgaria, Serbia, Macedonia, Albania, Armenia, Azerbaijan, Georgia, Montenegro, Bosnia, Croatia, Slovenia,

Slovakia, Czech Republic, Hungary, Chechnya, Uzbekistan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, Greece, Austria, and Russia.

The sublicense agreement provides that WPD must use commercially reasonable development efforts to attempt to develop and commercialize

licensed products in the above-mentioned territories, which means the expenditure of at least $2.0 million on the development, testing,

regulatory approval or commercialization of the licensed products during the three year period immediately following the date of the sublicense

In the event that WPD fails to use commercially reasonable development efforts by the foregoing three-year deadline, we have

the right to terminate this sublicense agreement.

The Company is currently validating WPD expenditures related to this agreement.

In consideration

for the rights granted under the sublicense agreement, to the extent we are required to make any payments to HPI pursuant to the HPI License

as a result of this sublicense agreement, WPD agreed to advance us such payments, and to pay us a royalty equal to 1% of such payments.

WPD is a Polish corporation that is majority-owned by an entity controlled by Dr.

Priebe, our founder and largest shareholder.

February 19, 2021, CNS entered into an Investigational Medicinal Product Supply Agreement with WPD, a related party.

CNS agreed to

sell the Berubicin drug product to WPD at historical cost of manufacturing without markup so that WPD may conduct the clinical

trials contemplated by the sublicense agreement.

WPD agreed to pay CNS the following payments:

(i) an upfront payment of $ 131,073 upon

execution of the agreement, (ii), a payment of $ 262,145 upon

final batch release and certification performed by WPD's subcontractor, and (iii) a final payment of $262,145 upon Clinical Trial

Application acceptance by the relevant regulatory authority.

All three milestones have been met as of September 30, 2021.

addition, as of September 30, 2021, the drug product with a cost of approximately $ 655,000 has

been delivered to WPD and is being held at a third party depot.

As such, the full amount of approximately $655,000 is now due from

As of September 30, 2021, CNS has invoiced the first of the three amounts plus pass through cost for a total of $132,648.

However, WPD has not remitted payment for that invoice and, as such we have not recorded a receivable for the second and third

milestones due to the collectability issues, and we have recorded a reserve against the related receivable resulting in an

increase to our research and development expense.

The Company is working with WPD to resolve this situation.

On February 19, 2021, CNS entered into an Investigational Medicinal

Product Supply Agreement with WPD, a related party.

CNS agreed to sell the Berubicin drug product to WPD at historical cost of manufacturing

without markup so that WPD may conduct the clinical trials contemplated by the sublicense agreement.

WPD agreed to pay CNS the following

(i) an upfront payment of $ 131,073 upon execution of the agreement, (ii), a payment of $ 262,145 upon final batch release

and certification performed by WPD's subcontractor, and (iii) a final payment of $262,145 upon Clinical Trial Application acceptance

by the relevant regulatory authority.

All three milestones have been met as of December 31, 2021.

In addition, as of December 31, 2021,

the drug product with a cost of approximately $ 655,000 has been delivered to WPD and is being held at a third party depot.

full amount of approximately $655,000 is now due from WPD.

As of December 31, 2021, CNS has invoiced the three amounts plus pass

through cost for a total of $656,938.

As of March 31, 2022, the Company has received payments for the first and second amounts due for

a total of $ 393,182 .

However, as of March 31, 2022, WPD has not remitted payment for the final invoice and, as such, we have not recorded

a receivable due to the collectability issues.

The Company is continuing to work with WPD to resolve this situation.

On August 31, 2018, the Company entered into a sublicense agreement

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the founder and a shareholder of ALI, holds 38% of the membership interests of ALI.

On June 10, 2020, the FDA granted Orphan Drug Designation (“ODD”)

for Berubicin for the treatment of malignant gliomas.

ODD from the FDA is available for drugs targeting diseases with less than 200,000

cases per year.

ODD may enable market exclusivity of 7 years from the date of approval of a New Drug Application (“NDA) in the United

During that period the FDA generally could not approve another product containing the same drug for the same designated indication.

Orphan drug exclusivity will not bar approval of another product under certain circumstances, including if a subsequent product with the

same active ingredient for the same indication is shown to be clinically superior to the approved product on the basis of greater efficacy

or safety, or providing a major contribution to patient care, or if the company with orphan drug exclusivity is not able to meet market

The ODD now constitutes our primary intellectual property protections although the Company is exploring if there are other patents

that could be filed related to Berubicin to extend additional protections.

On July 24, 2021, the Company received Fast Track Designation from

the FDA for Berubicin.

Fast Track Designation is designed to facilitate the development and expedite the review of drugs to treat

serious conditions and fill an unmet medical need.

WP1244 Portfolio

18 unchanged sentences

following the Effective Date and (iii) Commencement of Phase I Study within the five (5) year period following the Effective Date.

the nine months ended September 30, 2021, the Company paid $ 22,902 and accrued $ 25,766 to UTMDACC related to this agreement.

2020, pursuant to the WP1244 Portfolio license agreement described above, the Company entered into a Sponsored Research Agreement with

UTMDACC to perform research relating to novel anticancer agents targeting CNS malignancies.

The Company agreed to fund approximately $1,134,000

over a two-year period.

The Company recorded $ 734,000 in 2020 related to this agreement in research and development expenses in the Company’s

Consolidated Statements of Operations.

The remainder will be paid and recorded in 2021.

The principal investigator for this agreement

Waldemar Priebe, who controls a majority of the Company’s share.

During the nine months ended September 30, 2021, the Company

paid $ 200,000 and accrued an additional $400,000 to UTMDACC

related to this agreement.

As of September 30, 2021, the Company has accrued $ 600,000 in research and development expenses to UTMDACC.

the three months ended March 31, 2022 and 2021, the Company paid $ 44,424 and $ 22,902 to UTMDACC related to this agreement, respectively.

7, 2020, pursuant to the WP1244 Portfolio license agreement described above, the Company entered into a Sponsored Research Agreement

with UTMDACC to perform research relating to novel anticancer agents targeting CNS malignancies.

The Company agreed to fund

approximately $1,134,000 over a two-year period.

During the year ended December 31, 2020, the Company paid $ 334,000 and

accrued $ 400,000

related to this agreement in research and development expenses in the Company’s Consolidated Statements of Operations.

the year ended December 31, 2021, the Company paid $ 800,000 to

UTMDACC related to this agreement.

The Company has no further payment obligations as of March 31, 2022.

The principal investigator

for this agreement is Dr.

Waldemar Priebe, a significant shareholder.

Anti-Viral Portfolio

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Greece, Austria, Russia, Netherlands, Turkey, Belgium, Switzerland, Sweden, Portugal, Norway, Denmark, Ireland, Finland, Luxembourg, Iceland.

Pursuant to the Agreement, the Company agreed to pay WPD the following

(i) an upfront payment of $ 225,000 to WPD (paid in April 2020);

and (ii) within thirty days of the verified achievement of the

Phase II Milestone, (such verification shall be conducted by an independent third party mutually acceptable to the parties hereto), the

Company will make a payment of $775,000 to WPD.

WPD agreed to pay the Company a development fee of 50% of the net sales for any products

in the above territories;

provided that Poland shall not be included as a territory after WPD receives marketing approval for a product

in one-half of the countries included in the agreed upon territories or upon the payment by WPD to the Company of development fees of

$1.0 million.

Pursuant to the Agreement, the Company agreed to pay WPD the

following payments:

(i) an upfront payment of $ 225,000 to

WPD (paid in April 2020);

and (ii) within thirty days of the verified achievement of the Phase II Milestone, (such verification

shall be conducted by an independent third party mutually acceptable to the parties hereto), the Company will make a payment of

WPD agreed to pay the Company a development fee of 50% of the net sales for any products in the above territories;

that Poland shall not be included as a territory after WPD receives marketing approval for a product in one-half of the countries

included in the agreed upon territories or upon the payment by WPD to the Company of development fees of $ 1.0

The term of the Agreement will expire on the expiration of the sublicense pursuant to which WPD has originally sublicensed

the products.

During the nine months ended September 30, 2020, the Company paid $225,000 related to this agreement.

2021, the Company received Fast Track Designation from the FDA for Berubicin.

Fast Track Designation is designed to facilitate the

development and expedite the review of drugs to treat serious conditions and fill an unmet medical need.

– Subsequent Events

Subsequent to September 30, 2021, the Company

received a notice to exercise 915,263 warrants on a cashless basis resulting in issuance of 460,232 shares of common stock.

During the year ended December 31, 2020, the Company paid $ 225,000

related to this agreement.

Nasdaq Capital Markets Listing Qualifications

On February 18, 2022, the Company received

a deficiency letter from the Listing Qualifications Department of the Nasdaq Stock Market (“Nasdaq”) notifying the Company

that for the last 30 consecutive business days the bid price for the Company’s common stock had closed below the minimum $1.00 per

share requirement for continued inclusion in Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”).

The deficiency letter does not result in the immediate delisting of the Company’s common stock from Nasdaq.

The Company has been provided an initial period

of 180 calendar days, or until August 17, 2022, to regain compliance with the Bid Price Rule.

If the Company is not in compliance

with the Bid Price Rule by August 17, 2022, the Company may be afforded a second 180 calendar day period to regain compliance.

the Company would be required to meet the continued listing requirement for market value of publicly held shares and all other initial

listing standards required by Nasdaq, except for the minimum bid price requirement.

The Company intends to monitor the closing

bid price of its common stock and may, if appropriate, consider available options to regain compliance with the Bid Price Rule, which

could include effecting a reverse stock split.

However, there can be no assurance that the Company will be able to regain compliance with

the Bid Price Rule.

Note 6 – Subsequent Events

On April 28, 2022, the Compensation Committee approved cash bonuses

totaling $213,000 to the officers of the Company.

In addition, the officers and employees were awarded a total of 1,142,500 Restricted

Stock Units that partially vest over 4 years, partially vest upon the Company’s common stock price exceeding various closing prices

ranging from $2.00 - $4.00 per share and partially upon the completion of milestones established by the Board.

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 1. Financial Statements