What changed in this filing

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Item 1. Financial Statements

2024-05-15 compared with 2023-11-14 · 267 added, 243 removed, 301 unchanged (63% of the section changed)

2 unchanged sentences

Balance Sheets

September 30,

Current Assets:

Cash and cash equivalents

Deferred offering costs

Prepaid expenses and other current assets

12 unchanged sentences

Stockholders' Equity (Deficit):

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 4,207,068 and

1,617,325 shares issued and outstanding, respectively

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 10,668,932 and 6,214,598 shares issued and outstanding, respectively

Additional paid-in capital

4 unchanged sentences

( 4,430,525 )

( 4,432,115 )

Total Liabilities and Stockholders' Equity (Deficit)

4 unchanged sentences

Three Months Ended

Nine months ended

September 30, 2023

September 30, 2022

September 30, 2023

September 30, 2022

March 31, 2024

March 31, 2023

Operating expenses:

5 unchanged sentences

( 4,926,511 )

( 13,485,737 )

( 10,132,568 )

Other income (expenses):

4 unchanged sentences

$ ( 4,931,947 )

$ ( 13,475,976 )

$ ( 10,137,283 )

Loss per share - basic

3 unchanged sentences

See accompanying notes to the unaudited financial statements.

CNS Pharmaceuticals, Inc.

Statements of Stockholders' Equity (Deficit)

For the nine months ended September 30, 2023 and 2022

Pharmaceuticals, Inc.

Statements of

Stockholders' Equity (Deficit)

For the three months ended March 31, 2024 and 2023

Stockholders'

2 unchanged sentences

$ ( 69,566,903 )

Exercise of warrants

Stock-based compensation

$ ( 4,432,115 )

( 4,931,947 )

Balance March 31, 2023

( 55,647,624 )

Common stock issued for cash, net

Exercise of warrants

Stock-based compensation

( 4,021,234 )

Balance June 30, 2023

( 59,668,858 )

Common stock issued for cash, net

Exercise of warrants, net

Stock-based compensation

1 unchanged sentence

( 3,544,748 )

Balance September 30, 2023

Balance, March 31, 2024

$ ( 73,111,651 )

2 unchanged sentences

$ ( 50,715,677 )

Common stock issued for cash, net

Exercise of warrants

4 unchanged sentences

$ ( 55,647,624 )

Stock-based compensation

( 3,565,952 )

Balance June 30, 2022

( 42,159,273 )

Stock-based compensation

( 3,419,553 )

Balance September 30, 2022

$ ( 45,578,826 )

See accompanying notes to the unaudited financial statements.

1 unchanged sentence

Statements of Cash Flows

Nine Months Ended

September 30, 2023

September 30, 2022

Three Months Ended

March 31, 2024

March 31, 2023

Cash Flows from Operating Activities:

3 unchanged sentences

Stock-based compensation

Loss of disposal of fixed assets

Gain on disposal of fixed assets

Changes in operating assets and liabilities:

4 unchanged sentences

( 4,824,592 )

Cash Flows from Investing Activities:

Purchase of property and equipment

Net cash used in investing activities

Cash Flows from Financing Activities:

2 unchanged sentences

Proceeds from sale of common stock

Net cash provided by financing activities

Net cash provided by (used in) financing activities

Net change in cash and cash equivalents

5 unchanged sentences

Cash paid for income taxes

Supplemental disclosure of non-cash investing and financing activities:

Reclassification of deferred offering

costs to equity

See accompanying notes to the unaudited financial statements.

6 unchanged sentences

of anti-cancer drug candidates.

On August 25, 2022, the stockholders of the Company approved an amendment

to the Company’s amended and restated articles of incorporation (the “Amendment”) to effect the reverse stock split

at a ratio in the range of 1-for-2 to 1-for-30.

The reverse stock split became effective on November 28, 2022 on a 1-for-30 basis without

any change in the par value per share, which remained at $0.001.

The reverse stock split has been retroactively adjusted throughout these

financial statements and footnotes.

Note 2 – Summary of Significant Accounting

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financial statements not misleading.

Operating results for the three and nine months ended September 30, 2023 are not necessarily indicative

of the final results that may be expected for the year ending December 31, 2023.

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, 2022 included

in our Form 10-K filed with the SEC on March 31, 2023 (“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, 2024 are not necessarily indicative of the

final results that may be expected for the year ending December 31, 2024.

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, 2023 included in our

Form 10-K filed with the SEC on April 1, 2024 (“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, 2023 was $ 659,547 .

the FDIC insurance as of March 31, 2024 was $ 565,226 .

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

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

As of September 30, 2023, the Company’s potentially

As of March 31, 2024, the Company’s potentially

dilutive shares and options, which were not included in the calculation of net loss per share, included warrants to purchase 39,785,731

common shares unvested restricted stock units of 7,144 common shares, unvested performance units of 28,563 and options

for 328,770 common shares, respectively.

For the nine months ended September 30, 2022, the Company’s potentially dilutive

shares and options, which were not included in the calculation of net loss per share, included warrants to purchase 524,000 common

shares, unvested restricted stock units of 9,523 common shares, unvested performance units of 28,563 and options for 93,001

common shares, respectively.

Reclassification

- Certain reclassifications may have been made to our prior year’s

financial statements to conform to our current year presentation.

These reclassifications had no effect on our previously reported results

of operations or accumulated deficit.

Recent Accounting Pronouncements - In June 2016, the FASB

issued Accounting Standards Update No.

2016-13, Financial Instruments-Credit Losses:

Measurement of Credit Losses on Financial Instruments.

ASU 2016-13 requires measurement and recognition of expected credit losses for financial assets.

In April 2019, the FASB issued clarification

to ASU 2016-13 within ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives

and Hedging, and Topic 825, Financial Instruments, or ASU 2016-13.

The guidance is effective for fiscal years beginning after December

The Company adopted this standard on January 1, 2023, which had no material impact on the Company’s financial statements.

common shares, unvested restricted stock units of 7,144 common shares, unvested performance units of 28,563 and options for 341,190 common

shares, respectively.

As of March 31, 2023, the Company’s potentially dilutive shares and options, which were not included in the

calculation of net loss per share, included warrants to purchase 3,524,252 common shares, unvested restricted stock units of 9,523 common

shares, unvested performance units of 28,563 and options for 126,489 common shares, respectively.

Note 3 – Note Payable

On November 28, 2023, the Company entered into a short-term note payable

for an aggregate of $ 449,874 , bearing interest at 5.88 % per year to finance certain insurance policies.

Principal and interest payments

related to the note will be repaid over an 11-month period with the final payment due on October 31, 2023 .

As of September 30, 2023 and

December 31, 2022, the Company’s note payable balance was $ 41,904 and $ 409,968 , respectively.

for an aggregate of $ 329,571 ,

bearing interest at 9.74 %

per year to finance certain insurance policies.

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

with the final payment due on October

As of March 31, 2024 the Company’s note payable balance was $ 213,104 .

Note 4 – Equity

The Company has authorized 75,000,000 shares of common stock having

a par value of $ 0.001 per share.

In addition, the Company authorized 5,000,000 shares of preferred stock to be issued having a par value

The Company has authorized 75,000,000 shares

of common stock having a par value of $ 0.001 per

In addition, the Company authorized 5,000,000 shares

of preferred stock to be issued having a par value of $ 0.001 .

The specific rights of the preferred stock shall be determined by the board of directors.

Pursuant to the terms of the Capital on Demand™

Sales Agreement with JonesTrading Institutional Services LLC and Brookline Capital Markets, a division of Arcadia Securities, LLC (collectively,

the “Agent”), 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, 2023, the Company sold 723,406 shares of common

stock to the Agent for net proceeds of $ 2,101,958 .

On May 2, 2024, the Company filed a

Certificate of Amendment to its Amended and Restated Articles of Incorporation with the Secretary of State of the State of Nevada to

increase the number of the Company’s authorized shares of common stock from 75,000,000 shares to

300,000,000 shares.

On August 25, 2022, the stockholders of the Company approved an amendment

to the Company’s amended and restated articles of incorporation (the “Amendment”) to effect the reverse stock split

at a ratio in the range of 1-for-2 to 1-for-30, with such ratio to be determined in the discretion of the Company’s board of directors

and with such reverse stock split to be effected at such time and date, if at all, as determined by the Company’s board of directors

in its sole discretion prior to the one-year anniversary of the annual meeting.

Pursuant to such authority granted by the Company’s stockholders,

the Company’s board of directors approved a one-for-thirty (1:30) reverse stock split of the Company’s common stock and the

filing of the Amendment to effectuate the reverse split.

The reverse stock split became effective on November 28, 2022 on a 1-for-30 basis

without any change in the par value per share, which remained at $0.001.

On January 29, 2024, the Company entered into a placement agency agreement

with A.G.P./Alliance Global Partners (“AGP”) and Maxim Group LLC (“Maxim” and collectively with AGP, the “Placement

Agents”) (the “Placement Agreement”) for the public offering by the Company of (i) 2,215,667 shares (the “Shares”)

of the Company’s common stock, par value $ 0.001 per share (the “Common Stock”) (ii) pre-funded warrants to purchase

11,117,667 shares of Common Stock (the “Pre-Funded Warrants”);

(iii) Series A Warrants to purchase up to an aggregate

of 13,333,334 shares of Common Stock (the “Series A Warrants”);

and (iv) Series B Warrants to purchase up to an aggregate

of 13,333,334 shares of Common Stock (the “Series B Warrants”, and together with the Series A Warrants, the “Common

The Common Warrants and Pre-Funded Warrants are collectively referred to herein as the (“Warrants”).

purchase price of one share of Common Stock and accompanying Common Warrants was $ 0.30 and the combined purchase price of one Pre-Funded

Warrant and accompanying Common Warrants was $ 0.299 .

In connection with the offering, the Company entered into a Securities Purchase Agreement

(the “Purchase Agreement”) with certain institutional investors that participated in the offering.

As of April 1, 2024,

2,204,667 of the Pre-Funded Warrants have been exercised.

The closing of the sales of these securities occurred on February 1, 2024.

net proceeds to the Company from the offering were $ 3,331,000 , after deducting the placement agents’ fees and other offering expenses.

Stock Options

3 unchanged sentences

awards for up to 66,667 shares of common stock.

the Board of Directors of the Company approved the CNS Pharmaceuticals, Inc.

In 2020, the Board of Directors of the Company approved the CNS Pharmaceuticals,

2020 Stock Plan (the “2020 Plan”).

Plan allows for the Board of Directors to grant various forms of incentive awards for up to 100,000

shares of common stock.

The 2020 Plan allows for the Board of Directors to grant various forms of incentive

awards for up to 100,000 shares of common stock.

The 2020 Plan was amended effective as of August 9, 2023, which was approved by the Company’s

stockholders at the Company’s annual meeting on September 14, 2023.

The amendment increased the 2020 Plan by 745,800 shares

of common stock.

On December 30, 2022, the Board of Directors of the Company appointed

Faith Charles as an independent member of the Company’s Board of Directors and as Chairperson of the Board of Directors.

will receive an annual retainer for her service as Chairperson of $ 30,000 and, on the date of her appointment, was granted a ten-year

option to purchase 3,500 shares of Company common stock at an exercise price of $ 2.40 vesting in 36 equal monthly installments succeeding

the issuance date.

The total fair value of these option grants at issuance was $ 7,091 .

On March 29, 2023, the Board of Directors approved, based upon the

recommendation of the Compensation Committee, cash bonuses totaling $ 550,750 to the officers of the Company.

In addition, the officers

and an employee were awarded a total of 29,988 options at an exercise price of $ 0.996 .

Of the options issued, 50 % vest over 2 years and

50 % vest upon the Company’s common stock price exceeding various closing prices ranging from $ 6.00 - $ 24.00 per share.

total fair value of these option grants at issuance was $ 25,820 .

On May 3, 2023, the Board of Directors of the Company appointed Bettina

Cockroft, M.D., M.B.A as an independent member of the Company’s Board of Directors.

Cockroft was granted a ten-year option

to purchase 2,099 shares of Company common stock at an exercise price of $ 1.67 vesting in 36 equal monthly installments succeeding the

issuance date.

The total fair value of these option grants at issuance was $ 3,514 .

On August 4, 2023, the Board of Directors approved the issuance of

6,500 options to Dr.

The options have a ten-year term at an exercise price of $ 2.27 and vest in 36 equal monthly installments

succeeding the issuance date.

The total fair value of these option grants at issuance was $ 12,771 .

On August 27, 2023, the Board of Directors approved the issuance of

193,690 options to the board of directors.

The options have a ten-year term at an exercise price of $ 1.90 and vest on the first anniversary

date of issuance.

The total fair value of these option grants at issuance was $ 313,846 .

During the nine months ended September 30, 2023 and 2022, the Company

recognized $ 727,864 and $ 877,510 of stock-based compensation, respectively, related to outstanding stock options.

At September 30, 2023,

the Company had $ 940,197 of unrecognized expenses related to outstanding options.

The following table summarizes the stock option

activity for the nine months ended September 30, 2023:

The amendment increased the 2020 Plan by 745,800 shares of common

On January 19, 2024, the Board of Directors of the Company approved

the issuance of 12,420 options to Ms.

Mahery as compensation for her appointment to our Board of Directors.

The options have a ten-year

term at an exercise price of $ 0.253 and vest in 36 equal monthly installments succeeding the issuance date.

The total fair value of these

option grants at issuance was $ 2,728 .

During the three months ended March 31, 2024

and 2023, the Company recognized $ 192,375 and $ 272,446 of stock-based compensation, respectively, related to outstanding stock options.

At March 31, 2024, the Company had $ 528,432 of unrecognized expenses related to outstanding options.

The following table summarizes

the stock option activity for the three months ended March 31, 2024:

Schedule of stock option activity

1 unchanged sentence

Outstanding, December 31, 2023

Outstanding, September 30, 2023

Exercisable, September 30, 2023

As of September 30, 2023, the outstanding stock options have a weighted

average remaining term of 8.79 years and aggregate intrinsic value of options vested and outstanding of $ 0 and $ 4,318 , respectively.

of September 30, 2023, there were no awards remaining to be issued under the 2017 Plan and 545,610 awards remaining to be issued under

the 2020 Plan.

Outstanding, March 31, 2024

Exercisable, March 31, 2024

The aggregate fair value of the options measured during the three months

ended March 31, 2024 were calculated using the Black-Scholes option pricing model based on the following assumptions:

Schedule of assumptions

Three Months Ended

December 31, 2024

Fair value of common stock on measurement date

$ 0.253 per share

Risk free interest rate (1)

Volatility (2)

Dividend yield (3)

Expected term (in years)

The risk-free interest rate was determined by management using the market yield on U.S.

Treasury securities with comparable terms as of the measurement date.

The trading volatility was determined by calculating the volatility of the Company's peer group.

The Company does not expect to pay a dividend in the foreseeable future.

As of March 31, 2024, the outstanding stock options have a weighted

average remaining term of 8.35 years and aggregate intrinsic value of options vested and outstanding of $ 1,354 .

As of March 31, 2024,

there were no awards remaining to be issued under the 2017 Plan and 533,190 awards remaining to be issued under the 2020 Plan.

Stock Warrants

During the nine months ended September 30, 2023, the Company received

$ 725,668 in cash proceeds from the exercise of 238,958 warrants previously issued at an exercise price of $3.03 and 1,625,000 warrants

previously issued at an exercise price of $0.001.

On January 29, 2024, the Company entered into a warrant amendment agreement

(the “Warrant Amendment”) pursuant to which the Company agreed, subject to shareholder approval, to amend certain existing

warrants to purchase up to an aggregate of 3,756,000 shares of Common Stock at an exercise price of $1.28 per share and a termination

date of October 16, 2028, so that the amended warrants will have a reduced exercise price of $0.30 per share and a new termination date

of February 1, 2029.

If shareholder approval is not received, such existing warrants will have an exercise price equal to the Nasdaq minimum

price on the six-month anniversary of February 1, 2024 and a new termination date of February 1, 2029.

The other terms of such warrants

will remain unchanged.

During the three months ended March 31, 2024, the Company received

$ 12,405 in cash proceeds from the exercise of 2,204,667 warrants issued at an exercise price of $0.299 and 34,000 warrants previously

issued at an exercise price of $0.30.

The following table summarizes the stock warrant

activity for the nine months ended September 30, 2023:

Schedule of warrants activity

activity for the three months ended March 31, 2024:

Schedule of stock warrant activity

Weighted-Average Exercise Price Per Share

1 unchanged sentence

( 2,238,667 )

Outstanding, September 30, 2023

Exercisable, September 30, 2023

As of September 30, 2023, the outstanding and exercisable warrants

have a weighted average remaining term of 4.02 years and had no aggregate intrinsic value.

Outstanding, March 31, 2024

Exercisable, March 31, 2024

As of March 31, 2024, the outstanding and exercisable warrants have

a weighted average remaining term of 3.65 years and had no aggregate intrinsic value.

Restricted Stock Units

During the nine months ended September 30, 2023, the Company recognized

$ 17,888 of stock-based compensation, related to outstanding RSUs.

At September 30, 2023, the Company had $ 59,624 of unrecognized expenses related

to outstanding RSUs.

The following table summarizes the RSUs activity

for the nine months ended September 30, 2023:

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 9,523 Restricted Stock

Units that partially vest over 4 years.

The Company valued the RSUs based on the stock price at grant which total $ 95,399 .

During the three months ended March 31,

2024, the Company recognized $ 5,962

of stock-based compensation, related to outstanding stock RSUs.

At March 31, 2024, the Company had $ 47,699

of unrecognized expenses related to outstanding RSUs.

The following table

summarizes the RSUs activity for the three months ended March 31, 2024:

Schedule of restricted stock units activity

1 unchanged sentence

Non-vested, December 31, 2023

Non-vested, September 30, 2023

Non-vested, March 31, 2024

Performance Units

During the nine months ended September 30, 2023, the Company recognized

$ 28,990 related to outstanding stock PUs.

At September 30, 2023, the Company had $ 104,958 of unrecognized expenses related to PUs.

The following table summarizes the PUs activity

for the nine months ended September 30, 2023:

On April 28, 2022, the Compensation Committee approved, the officers

and employees were awarded a total of 28,563 PUs.

For awards granted in 2022, they vest as follows:

(i) 9,521 of the PU grant will vest

if within 24 months from issuance the average the closing price of the Company’s common stock over a ten trading day period exceeds

$60.00 (subject to pro rata adjustment for stock splits or similar events), (ii) 9,521 of the PU grant will vest if within 36 months from

issuance the average the closing price of the Company’s common stock over a ten trading day period exceeds $120.00 (subject to pro

rata adjustment for stock splits or similar events) and (iii) 9,521 of the PU grant will vest if within 24 months from issuance the Company

achieves “Positive Interim, Clinical Data” as defined by the Board of Directors.

To the extent that the market and/or “Positive

Interim Clinical Data” conditions are not met, the applicable portions of the PUs will not vest and will be cancelled.

value at grant date of these performance units was $ 169,663 .

Compensation expense is recognized over the derived service period for the

PUs with market conditions and over the requisite service period for PUs with performance conditions on the date when achievement of such

conditions are deemed probable.

The fair value of each performance unit with market conditions (vesting

terms (i) and (ii)) is estimated at the date of grant using a Monte Carlo simulation with the following assumptions:

underlying stock

price $10.02, hurdle prices ranging from $60.00 -$120.00, expected terms ranging from 2-3 years, cost of equity 18.7% and risk-free rate

During the three months ended March 31,

2024, the Company recognized $ 4,596 related

to outstanding stock PUs.

At March 31, 2024, the Company had $ 95,766

of unrecognized expenses related to PUs.

The following table summarizes

the PUs activity for the three months ended March 31, 2024:

Schedule of performance units activity

1 unchanged sentence

Non-vested, December 31, 2023

Non-vested, September 30, 2023

Non-vested, March 31, 2024

Note 5 – Commitments and Contingencies

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Picker agreed to commit 25% of his time to our matters.

On March 29, 2023, the Board of Directors approved, based upon the

recommendation of the Compensation Committee, cash bonuses totaling $ 550,750 to the officers of the Company.

In March 2024, the Board of Directors approved, based upon the recommendation

of the Compensation Committee, cash bonuses totaling $ 240,608 to the officers of the Company payable upon completion of a subsequent round

of financing and a determination by the Board that such financing is sufficient for the Company's needs after payment of such bonus.

Scientific Advisory Board

On July 15, 2021, our Board approved the following compensation policy

for members of the Scientific Advisory Board.

The Scientific Advisory board consists of Dr.

The scientific advisory board

member shall receive annual cash compensation of $68,600.

During the nine months ended September 30, 2023 and 2022, the Company paid $ 0

and $ 76,087 related to the Scientific Advisory Board compensation.

As of September 30, 2023, the Company has accrued $ 151,584 related

Hsu’s Scientific Advisory Board compensation.

for the Scientific Advisory Board members.

The Scientific Advisory board consisted of Dr.

Waldemar Priebe, our founder and related party,

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

As of August 25, 2022, Dr.

Waldemar Priebe is no longer a member of the Scientific Advisory Board.

On March 14, 2024, the Board of Directors terminated the cash

compensation program for the Scientific Advisory Board.

As of March 31, 2024, the Company has accrued $ 185,884 related to Mr.

Scientific Advisory Board compensation.

WP744 Portfolio (Berubicin)

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Company on the development of Berubicin, from time to time.

On December 28, 2017, the Company entered into a Technology Rights

and Development Agreement with Houston Pharmaceuticals, Inc.

On December 28, 2017, the Company entered into a Technology

Rights and Development Agreement with Houston Pharmaceuticals, Inc.

HPI is affiliated with Dr.

Waldemar Priebe, our founder.

Pursuant to this agreement, the Company obtained a worldwide exclusive license to the chemical compound commonly known as WP744.

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 (paid

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

In addition, the Company issued 6,667 shares of the Company’s common stock valued at $1.35 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 nine months ended September 30, 2023 and 2022, the Company recognized

$ 37,500 and $ 262,500 , respectively, 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 nine months ended September 30, 2023 and 2022, the Company expensed $ 0 and

$ 41,075 respectively related to the purchase of pharmaceutical products from HPI.

Waldemar Priebe,

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

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 (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 6,667 shares of the Company’s

common stock valued at $1.35 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

During the three months ended March 31, 2024 and 2023, the Company recognized $ 12,500

and $ 12,500 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.

On May 14, 2024, the Company provided notice to HPI of its intent to terminate the HPI License effective on or

about July 14, 2024.

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

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receivable and as a reduction to research and development expense.

As of September 30, 2023, the outstanding accounts receivable balance

As of December 31, 2023, the outstanding accounts receivable balance

of $ 197,605 was collected in full.

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

with Animal Life Sciences, LLC (“ALI”), pursuant to which we granted ALI an exclusive sublicense, even as to us, for the patent

rights we licensed pursuant to the HPI License solely for the treatment of cancer in non-human animals through any type of administration.

In consideration for the rights granted under the sublicense agreement, ALI agreed to issue us membership interests in ALI equal to 1.52%

of the outstanding ALI membership interests.

As additional consideration for the rights granted, to the extent we are required to make

any payments to HPI pursuant to the HPI License as a result of this sublicense agreement, ALI agreed to advance us such payments, and

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

Waldemar Priebe, our founder, is also the founder and a shareholder of ALI, holds

38% of the membership interests of ALI.

with Animal Life Sciences, LLC (“ALI”), a related party, pursuant to which we granted ALI an exclusive sublicense, even as

to us, for the patent rights we licensed pursuant to the HPI License solely for the treatment of cancer in non-human animals through any

type of administration.

In consideration for the rights granted under the sublicense agreement, ALI agreed to issue us membership interests

in ALI equal to 1.52% of the outstanding ALI membership interests.

As additional consideration for the rights granted, to the extent we

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

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

Waldemar Priebe, our founder, is also 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”)

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cases per year.

ODD may enable market exclusivity of 7 years from the date of approval of a NDA in the United States.

ODD may enable market exclusivity of 7 years from the date of approval of an NDA in the United States.

During that period

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

Company has not met the commercial diligence milestones required as of the date hereof.

As such, UTMDACC has the right to terminate the

Agreement upon notice to the Company.

As of the date of this report, UTMDACC has not notified the Company of its intention to terminate

the Agreement.

During the nine months ended September 30, 2023 and 2022, the Company paid $ 45,092 and $ 49,607 , respectively.

Company has not met the commercial diligence milestones and has not paid the annual maintenance fee required as of the date hereof.

April 25, 2024, UTMDACC provided notice to the Company of its intent to terminate the WP1244 Agreement if the Company fails to pay the

annual maintenance fee of $50,000, as well as $1,300 in expenses.

As of the date hereof, the Company has not determined whether to cure

the foregoing defaults.

If the Company fails to cure the defaults, on May 25, 2024, the WP1244 Agreement will terminate..

During the three

months ended March 31, 2024 and 2023, the Company paid $ 694 and $ 11,744 , respectively.

On May 7, 2020, pursuant to the WP1244 Portfolio license agreement

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agents targeting CNS malignancies.

The Company agreed to fund approximately $1,134,000 over a two-year period, which has been fully paid

by the Company in 2021.

This agreement was extended and expired on March 31, 2023.

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.

During the year ended December 31, 2021, the Company paid $ 800,000 to UTMDACC related to this

The Company has no further payment obligations as of December 31, 2021.

This agreement was extended and now expires on March

The principal investigator for this agreement is Dr.

Waldemar Priebe, our founder.

Nasdaq Capital Markets Listing Qualifications

On August 17, 2023, the Company was notified by the Listing Qualifications

Department (the “Staff”) of the Nasdaq Stock Market (“Nasdaq”) that the Company was not in compliance with the

minimum $ 2,500,000 stockholders’ equity requirement for continued listing set forth in Listing Rule 5550(b).

On February 27, 2024,

the Staff notified the Company that it did not comply with the $1.00 minimum bid price requirement set forth under Listing Rule 5550(a)(2).

On February 14, 2024, the Company was notified that because it had not regained compliance with the Nasdaq equity requirement, its securities

would be delisted unless it requested a hearing.

On February 21, 2024, the Company requested a hearing, which was held on April 18, 2024.

On May 6, 2024, the Company received notification from the Nasdaq Hearings

Panel (“Panel”) that it has granted an extension until July 15, 2024, to demonstrate compliance with Listing Rules 5550(a)(2)

The Company intends to implement its plan to meet the milestones set forth by the Panel prior to July 15, 2024.

Note 6 – Subsequent Events

16, 2023, the Company entered into a warrant exercise inducement offer letter (the “Inducement Letter”) with a holder of certain

existing warrants (“Holder”) to receive new warrants to purchase up to a number of shares of common stock equal to 200% (the

“Inducement Warrants”) of the number of warrant shares issued pursuant to the exercise of such certain existing warrants to

purchase shares of common stock (the “Existing Warrants”) pursuant to which the Holder agreed to exercise for cash their Existing

Warrants to purchase up to 1,878,000 shares of the Company’s common stock, at a Reduced Exercise Price (as defined below),

in exchange for the Company’s agreement to issue the Inducement Warrants to purchase up to 3,756,000 shares of the Company’s

common stock (the “Inducement Warrant Shares”).

The Existing Warrants consist of:

(i) warrants, originally issued on December

22, 2020 and amended on December 5, 2022;

(ii) warrants, originally issued on January 10, 2022 and amended on December 5, 2022;

warrants issued on December 5, 2022.

Pursuant to the Inducement Letter, the exercise price for such Existing Warrants was reduced to $1.28

per share (the “Reduced Exercise Price”).

The Company received aggregate gross proceeds of $2,403,840 from the exercise of

the Existing Warrants before deducting financial advisory fees and other expenses payable by it .

Pursuant to the Inducement Letter, although the exercise of the warrants has occurred and full payment of the exercise price has been

made, the Holder has directed that a number of shares be held in abeyance and not yet issued until they direct us to do so.

As such, the shares have not been issued and do not appear in our count of common

shares outstanding.

Pursuant to the terms of the Capital on Demand™ Sales Agreement

with JonesTrading Institutional Services LLC and Brookline Capital Markets, a division of Arcadia Securities, LLC (collectively, the “Agent”),

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.

Subsequent to the quarter ended on September 30, 2023, the Company sold 129,530 shares of common stock to the Agent

for net proceeds of $215,641.

On April 7, 2024, the Compensation Committee recommended,

and the Board approved such recommendation, equity grants for service in 2023 from the Stock Plan a total of 179,000 Options that

vest over 3 years, and 179,000 Restricted Stock Units which vest over 2 years.

On April 30, 2024, the Company held its scheduled

2024 Annual Meeting of Stockholders at which the Company’s stockholders approved amendments to the Company's 2020 Equity Plan (the

“2020 Plan”) including an increase in the number of shares of common stock, par value $0.001 per share, authorized for issuance

under the 2020 Plan by 3,500,000 shares.

As amended, the number of shares of the common stock that may be issued under the 2020 Plan

is 4,345,800 shares (this includes the 3,500,000 share increase).

Subsequent to March 31, 2024, a total of 1,183,000 Warrants (exercisable

into one share of common stock at a price per share of $0.001) were exercised by investors.

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