What changed in this filing

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Item 1. Financial Statements

2025-05-15 compared with 2024-11-14 · 171 added, 468 removed, 252 unchanged (72% of the section changed)

2 unchanged sentences

Balance Sheets

September 30,

March 31, 2025

Current Assets:

1 unchanged sentence

Deferred offering costs

Subscription receivable

Prepaid expenses and other current assets

19 unchanged sentences

Total Stockholders' Equity (Deficit)

( 4,432,115 )

Total Liabilities and Stockholders' Equity (Deficit)

See accompanying notes to the unaudited financial statements.

See accompanying notes to the unaudited financial

CNS Pharmaceuticals, Inc.

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Three Months Ended

Nine Months Ended

September 30, 2024

September 30, 2023

September 30, 2024

September 30, 2023

March 31, 2025

March 31, 2024

Operating expenses:

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( 3,544,854 )

( 11,701,895 )

( 13,485,737 )

Other income (expenses):

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$ ( 3,544,748 )

$ ( 11,681,435 )

$ ( 13,475,976 )

Loss per share - basic

$ ( 1,020.48 )

Loss per share - diluted

$ ( 1,020.48 )

Weighted average shares outstanding - basic

Weighted average shares outstanding - diluted

See accompanying notes to the unaudited financial statements.

Pharmaceuticals, Inc.

Statements of

Stockholders' Equity (Deficit)

For the nine months ended September 30, 2024 and 2023

See accompanying notes to the unaudited financial

CNS Pharmaceuticals, Inc.

Statements of Stockholders' Equity (Deficit)

For the three months ended March 31, 2025 and

Stockholders'

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$ ( 84,424,704 )

$ ( 4,432,115 )

Common stock issued for cash, net

Exercise of warrants, net

Stock cancelled during stock split rounding

Stock-based compensation

3 unchanged sentences

$ ( 88,726,024 )

( 4,430,527 )

Common stock issued for cash and warrants, net

Exercise of warrants, net

Stock-based compensation

Adjustment related to reverse stock split

( 2,530,753 )

Balance, June 30, 2024

( 75,642,404 )

( 4,293,601 )

Common stock issued for cash and warrants, net

Stock-based compensation

Common stock issued for license agreement

( 5,605,934 )

Balance, September 30, 2024

$ ( 81,248,338 )

Balance December 31, 2023

$ ( 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

3 unchanged sentences

( 3,544,748 )

Balance, June 30, 2023

( 59,668,858 )

Common stock issued for cash, net

Stock-based compensation

( 4,522,795 )

Balance, September 30, 2023

Balance, March 31, 2024

$ ( 73,111,651 )

$ ( 4,430,525 )

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, 2024

September 30, 2023

Three Months Ended

March 31, 2025

March 31, 2024

Cash Flows from Operating Activities:

3 unchanged sentences

Stock-based compensation

Common stock issued for license agreement

(Gain) loss on disposal of fixed assets

Gain on disposal of fixed assets

Changes in operating assets and liabilities:

1 unchanged sentence

Accounts payable and accrued expenses

( 1,806,420 )

Net cash used in operating activities

1 unchanged sentence

( 3,192,057 )

Cash Flows from Investing Activities:

Purchase of property and equipment

Net cash used in investing activities

Cash Flows from Financing Activities:

Payments of deferred offering costs

Payments on notes payable

Proceeds from exercise of warrants

Proceeds from sale of common stock and warrants, net

Payments to stockholders for stock split round

Proceeds from subscription receivable

Proceeds from equity issuance

Net cash provided by financing activities

Net change in cash and cash equivalents

( 9,145,860 )

Cash and cash equivalents, at beginning of period

4 unchanged sentences

Supplemental disclosure of non-cash investing and financing activities:

Prepaid insurance financed with note payable

Reclassification of deferred offering costs to equity

See accompanying notes to the unaudited financial statements.

See accompanying notes to the unaudited financial

CNS Pharmaceuticals, Inc.

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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.

On April 30, 2024, 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-50.

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

a ratio in the range of 1-for-2 to 1-for-50.

The reverse stock split became effective on June 4, 2024 on a 1-for-50 basis without any

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financial statements and footnotes.

On November 26, 2024, the stockholders of the Company approved an amendment

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

a ratio in the range of 1-for-2 to 1-for-50.

The reverse stock split became effective on February 21, 2025 on a 1-for-50 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, 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”).

Operating results for the three months ended March 31, 2025 are not necessarily indicative of the

final results that may be expected for the year ending December 31, 2025.

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, 2024 included in our

Form 10-K filed with the SEC on March 31, 2025 (“Form 10-K”).

Notes to the financial statements which would substantially

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The amount in excess of

the FDIC insurance as of September 30, 2024 was $ 6,723,124 .

the FDIC insurance as of March 31, 2025 was $ 12,797,592 .

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

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Restricted Stock Units (“RSUs”) - Our RSUs vest over

four years from the date of grant.

two to four years from the date of grant.

The fair value of RSUs is the market price of our common stock at the date of grant.

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our performance against predefined share price targets and the achievement of Positive Interim, Clinical Data as defined by the Board.

Per Common Share - Basic loss per common share is computed by dividing net loss available to common shareholders by the

weighted-average number of common shares outstanding during the period.

Diluted loss per common share is determined using the

weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock

In periods when losses are reported, the weighted-average number of common shares outstanding excludes common stock

equivalents, because their inclusion would be anti-dilutive.

As of September 30, 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 2,976,422

common shares, unvested restricted stock units of 5,475

common shares, unvested performance units of 192

and options for 12,177

common shares, respectively.

As of September 30, 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 45,399

common shares, unvested restricted stock units of 193

common shares, unvested performance units of 577

and options for 6,598

common shares, respectively.

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

by dividing net loss available to common shareholders by the weighted-average number of common shares outstanding during the period.

loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the

dilutive effect of common stock equivalents.

In periods when losses are reported, the weighted-average number of common shares outstanding

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

As of March 31, 2025, the Company’s potentially

dilutive shares and options, which were not included in the calculation of net loss per share, included warrants to purchase 59,579 common

shares, unvested restricted stock units of 114 common shares, unvested performance units of 5 and options for 270 common shares, respectively.

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 15,969 common shares, unvested restricted stock units of 6 common shares, unvested performance

units of 19 and options for 162 common shares, respectively.

Segments Reporting

The Company manages its operations as a single segment for the purpose

of assessing performance and making operating decisions.

The Company’s Chief Operating Decision Maker (“CODM”) is its

Chief Executive Officer.

The CODM allocates resources and evaluates the performance of the Company using information about combined net

income from operations.

All significant operating decisions are based upon an analysis of the Company as one operating segment, which

is the same as its reporting segment.

See statement of operations for information about combined net income from operations.

Note 3 – Note Payable

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related to the note will be repaid over an 11-month period with the final payment due on October 8, 2025 .

As of September 30, 2024 the

Company’s note payable balance was $ 31,187 .

As of March 31, 2025 the Company’s

note payable balance was $ 210,673 .

Note 4 – Equity

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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

On April 30, 2024, 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

3 unchanged sentences

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

the Company’s board of directors approved a one-for-fifty (1:50) 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

The reverse stock split became effective on June 4, 2024 on a 1-for-50 basis

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

On April 30, 2024, the stockholders of the Company approved an amendment

The reverse stock split has been retroactively adjusted throughout

these financial statements and footnotes.

On November 26, 2024, 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

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filing of the Amendment to effectuate the reverse split.

The reverse stock split became effective on June 4, 2024 on a 1-for-50 basis

The reverse stock split became effective on February 21, 2025 on a 1-for-50 basis

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

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 70,000 shares.

As amended, the number of shares of the common stock that may be issued under the 2020 Plan is 86,916 shares (this includes

the 70,000 share increase).

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) 44,314 shares (the “Shares”)

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

222,354 shares of Common Stock (the “Pre-Funded Warrants”);

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

266,667 shares of Common Stock (the “Series A Warrants”);

and (iv) Series B Warrants to purchase up to an aggregate of 266,667

shares of Common Stock (the “Series B Warrants”, and together with the Series A Warrants, the “Common Warrants)).

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

The combined purchase price

of one share of Common Stock and accompanying Common Warrants was $15.00 and the combined purchase price of one Pre-Funded Warrant and

accompanying Common Warrants was $14.95.

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, 44,094

of the Pre-Funded Warrants have been exercised.

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

The net proceeds

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

On June 14, 2024, the Company entered into securities purchase agreements

with institutional investors for the sale by the Company of 336,000 shares of the Company’s common stock and pre-funded warrants

to purchase 30,000 shares of common stock in lieu thereof (the “June 14 Pre-Funded Warrants”) in a registered direct offering.

In a concurrent private placement, the Company also sold to the investors unregistered warrants to purchase up to an aggregate of 366,000

shares of common stock (the “June 14 Common Warrants”).

The combined purchase price of one share of common stock (or pre-funded

warrant in lieu thereof) and accompanying June 14 Common Warrant was $3.75.

The closing of this offering and private placement occurred

on June 17, 2024.

Subject to certain ownership limitations, each of the June 14 Common

Warrants is immediately exercisable, has an exercise price of $3.62 per share, and expire five years from the date of issuance.

Subject to certain ownership limitations, each June 14 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

The gross proceeds to the Company from the offering was approximately $ 1.37 million , resulting in net proceeds, after payment

of commissions and expenses, received by the Company of $ 1,203,259 .

On June 26, 2024, the Company entered into securities purchase agreements

with institutional investors for the sale by the Company of 568,000 shares of the Company’s common stock in a registered direct

In a concurrent private placement, the Company also sold to the investors unregistered warrants to purchase up to an aggregate

of 568,000 shares of common stock (the “June 26 Common Warrants”).

The combined purchase price of one share of common stock

and accompanying June 26 Common Warrant was $2.45.

The closing of the offering and private placement occurred on June 27, 2024 (the “Closing

Subject to certain ownership limitations, each of the June 26 Common

Warrants is immediately exercisable, has an exercise price of $2.32 per share, and expire five years from the date of issuance.

26 Common Warrants may only be exercised on a cashless basis if there is no registration statement registering, or a prospectus contained

therein in not available for, the resale of the shares of common stock underlying the June 26 Common Warrants.

The gross proceeds to the

Company from the offering were approximately $ 1.39 million resulting in net proceeds, after payment of commissions and expenses, received

by the Company of $ 1,221,154 .

On July 3, 2024, the Company entered into securities purchase agreements

with institutional investors for the sale by the Company of 1,425,000 shares of the Company’s common stock in a registered direct

In a concurrent private placement, the Company also sold to the investors unregistered warrants to purchase up to an aggregate

of 1,425,000 shares of common stock (the “July 3 Common Warrants”).

The combined purchase price of one share of common stock

and accompanying July 3 Common Warrant is $1.39.

The closing of this offering and private placement occurred on July 5, 2024.

Subject to certain ownership limitations, each of the July 3 Common

Warrants is immediately exercisable, has an exercise price of $1.26 per share, and expire five years from the date of issuance.

proceeds to the Company from the offering were approximately $ 1.98 million , before deducting the financial advisor fees and other estimated

offering expenses payable by the Company, and excluding the proceeds, if any, from the exercise of the Common Warrants.

On July 26, 2024, the Company entered into a Sales Agreement (the “AGP

ATM Sales Agreement”) with A.G.P./Alliance Global Partners (“AGP”).

Pursuant to the terms of the AGP ATM Sales Agreement,

the Company originally was permitted to sell from time to time through AGP, as sales agent or principal, shares of the Company’s

common stock, par value $0.001 per share with initial aggregate sales price of up to $5.2 million.

On July 30, 2024, the Company increased

the aggregate sales price of common shares that may be sold under the AGP ATM Sales Agreement to $25.0 million (not including the original

$5.2 million).

As of September 30, 2024, the Company has sold 30,004,761 Shares pursuant to the Agreement for net proceeds of approximately

$ 10.6 million .

Common share issued for license agreement

On July 29, 2024, the Company entered into an Exclusive License Agreement

and Stock Purchase Agreement (collectively, the “Cortice Agreements”) with Cortice Biosciences, Inc.

pursuant to which Cortice granted the Company an exclusive license to the intellectual property rights related to certain patents around

the compound TPI 287 in the United States, Canada, Mexico and Japan.

The term of the license will expire, other than due to a breach of

the Cortice Agreements, at the end of the royalty term with respect to any licensed product in any of the included territories, which

begins upon the first commercial sale in such territory and ends on the latest of (i) ten years after such sale, (ii) the expiration of

regulatory or marketing exclusivity for such licensed product in such country, or (c) the expiration of the last to expire valid patent

claim in such country covering such licensed product.

Pursuant to the Cortice Agreements, the Company agreed to issue

Cortice 573,368

shares of the Company’s common stock upon the closing of the transaction, which occurred on July 29, 2024, and 43,330

shares of Company common stock upon the receipt of shareholder approval of such issuance as required by the rules of the Nasdaq

Stock Market.

The Company also agreed to make milestone payments to Cortice in either cash or shares of Company common stock (at

Cortice’s option) upon:

(i) meeting the primary endpoint a pivotal trial for a licensed product – either $15.0 million

or 411,132 shares of Company common stock;

(ii) FDA acceptance of an New Drug Application for a licensed product – either

$30.0 million or 822,264 shares of Company common stock;

(iii) the first commercial sale in the United States of a licensed product

– either $45.0 million or 1,233,395 shares of Company common stock;

and (iv) the first commercial sale in Japan of a licensed

product – either $10.0 million or 205,566 shares of Company common stock.

The Company’s obligation to pay the above

milestones in Company common stock is subject to the receipt of shareholder approval as required by the rules of the Nasdaq Stock

The Company also agreed to pay Cortice royalties on sales of licensed products of between 3.0%-7.5%.

Finally, to the extent

Cortice is required to pay any milestone payments to the original holder of the intellectual property rights licensed, the Company

has agreed to make such payments to Cortice.

As of September 30, 2024, there were no accruals related to the milestone payments and

the Company issued 573,368

Shares with a fair value of $ 596,302

pursuant to the Cortice Agreement.

The reverse stock split has been retroactively adjusted throughout

these financial statements and footnotes.

On July 26, 2024, the Company entered into a Sales Agreement (the

“AGP ATM Sales Agreement”) with A.G.P./Alliance Global Partners (“AGP”).

Pursuant to the terms of the AGP ATM

Sales Agreement, the Company originally was permitted to sell from time to time through AGP, as sales agent or principal, shares of the

Company’s common stock, par value $0.001 per share with initial aggregate sales price of up to $5.2 million.

On July 30, 2024,

the Company increased the aggregate sales price of common shares that may be sold under the AGP ATM Sales Agreement to $25.0 million

(not including the original $5.2 million).

On March 20, 2025, the Company increased the aggregate sales price of common shares that may

be sold under the AGP ATM Sales Agreement to $43.5 million (which amount includes $6.4 million remaining from the $30.2 million set forth

During the period ended March 31, 2025, the Company has sold 1,530,985 shares of common stock pursuant to the AGP ATM Sales Agreement

for net proceeds of approximately $ 9 million.

As of March 31, 2025, the Company has sold 2,522,758 shares of common stock pursuant to

the AGP ATM Sales Agreement for net proceeds of approximately $ 22.8 million.

Stock Options

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The amendment increased the 2020 Plan by 298 shares of common

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

the issuance of 249 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 $ 12.65 and vest in 36 equal monthly installments succeeding the issuance date.

The total fair value of these option

grants at issuance was $ 2,728 .

On April 7, 2024, the Board of Directors approved grants of 5,330 options

to officers, employees, and board of directors.

The options have a ten-year term at an exercise price of $ 12.93 .

Of the 5,330 options

issued, 1,750 options vest on the first anniversary or at the time of the 2025 shareholder meeting, whichever occurs first and 3,580 options vest in 36 equal monthly installments over 3 years.

The total fair value of these option grants at issuance was $ 58,335 .

During the nine months ended September 30, 2024 and 2023, the

Company recognized $ 571,705

and $ 727,864

of stock-based compensation, respectively, related to outstanding stock options.

At September 30, 2024, the Company had $ 207,444

of unrecognized expenses related to outstanding options.

During the three months ended March 31, 2025 and 2024, the Company

recognized $ 44,943 and $ 192,375 of stock-based compensation, respectively, related to outstanding stock options.

At March 31, 2025, the

Company had $ 50,646 of unrecognized expenses related to outstanding options.

The following table summarizes

the stock option activity for the nine months ended September 30, 2024:

the stock option activity for the three months ended March 31, 2025:

Schedule of stock option activity

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Outstanding, December 31, 2024

Outstanding, September 30, 2024

Exercisable, September 30, 2024

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

ended September 30, 2024 were calculated using the Black-Scholes option pricing model based on the following assumptions:

Schedule of black-ccholes option assumptions

Nine Months Ended

September 30, 2024

Fair value of common stock on measurement date

$12.65 to $12.93 per share

Risk free interest rate (1)

3.80 % to 4.39 %

Volatility (2)

102.25 % to 118.36 %

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 September 30, 2024, the outstanding stock options have a weighted

Outstanding, March 31, 2025

Exercisable, March 31, 2025

As of March 31, 2025, the outstanding stock options have a weighted

average remaining term of 7.91 years and no aggregate intrinsic value.

As of September 30, 2024, there were no awards remaining to be

issued under the 2017 Plan and 69,973 awards remaining to be issued under the 2020 Plan.

As of March 31, 2025, there were no awards remaining to be issued

under the 2017 Plan and 27 shares of common stock remaining to be issued under the 2020 Plan.

Stock Warrants

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 (which was received on April

30, 2024), to amend certain existing warrants to purchase up to an aggregate of 75,120 shares of Common Stock at an exercise price of

$64.00 per share and a termination date of October 16, 2028, so that the amended warrants will have a reduced exercise price of $15.00

per share and a new termination date of February 1, 2029.

During the nine months ended September 30, 2024, the Company received

$ 21,326 in cash proceeds from the exercise of 253,034 warrants previously issued at an exercise price range of $0.001 to $15.00.

The following table summarizes the stock warrant

activity for the nine months ended September 30, 2024:

activity for the three months ended March 31, 2025:

Schedule of stock warrant

1 unchanged sentence

Outstanding, December 31, 2024

Outstanding, September 30, 2024

Exercisable, September 30, 2024

As of September 30, 2024, the outstanding and exercisable

warrants have a weighted average remaining term of 4.35

years and had no aggregate intrinsic value.

Outstanding, March 31, 2025

Exercisable, March 31, 2025

As of March 31, 2025, the outstanding and exercisable warrants have

a weighted average remaining term of 3.85 years and had no aggregate intrinsic value.

Restricted Stock Units

On April 28, 2022, the Board of Directors granted officers and employees

a total of 193 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 .

On April 7, 2024, the Board of Directors approved grants of 5,330 RSUs

to officers, employees, and board of directors.

Of the 5,330 RSUs issued, 1,750 RSUs vest on the first anniversary or at the time of the

2025 shareholder meeting, whichever occurs first and 3,580 RSUs vest in 8 equal quarterly installments over 2 years.

The Company valued

the RSUs based on the stock price at grant which total $ 69,027 .

During the nine months ended September 30,

During the three months ended March 31, 2025,

the Company recognized $ 17,424 of stock-based compensation, related to outstanding stock RSUs.

At September 30, 2024, the Company

had $ 85,699 of unrecognized expenses related to outstanding RSUs.

At March 31, 2025, the Company had $ 50,851

of unrecognized expenses related to outstanding RSUs.

The following table summarizes

the RSUs activity for the nine months ended September 30, 2024:

the RSUs activity for the three months ended March 31, 2025:

Schedule of RSUs activity

1 unchanged sentence

Non-vested, December 31, 2024

Non-vested, September 30, 2024

Non-vested, March 31, 2025

Performance Units

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

and employees were awarded a total of 577 PUs.

For awards granted in 2022, they vest as follows:

(i) 193 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

$3,000 (subject to pro rata adjustment for stock splits or similar events), (ii) 192 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 $6,000 (subject to pro

rata adjustment for stock splits or similar events) and (iii) 192 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 $501, hurdle prices ranging from $3,000 -$6,000, expected terms ranging from 2-3 years, cost of equity 18.7% and risk-free rate

During the nine months ended September 30,

During the three months ended March 31, 2025,

the Company recognized $ 0 related to outstanding stock PUs.

At September 30, 2024, the Company had $ 0 of unrecognized

expenses related to PUs.

At March 31, 2025, the Company had $ 0 of unrecognized expenses related

The following table summarizes

the PUs activity for the nine months ended September 30, 2024:

the PUs activity for the three months ended March 31, 2025:

Schedule of PUs activity

1 unchanged sentence

Non-vested, December 31, 2024

Non-vested, September 30, 2024

Non-vested, March 31, 2025

Note 5 – Commitments and Contingencies

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to $ 525,000 .

On March 6, 2025, the compensation committee of the board of directors set Mr.

Climaco’s annual base salary to $ 580,000 ,

retroactive to January 1, 2025.

On June 28, 2019, we entered into employment letters with Drs.

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

On January 1, 2025, Dr.

Silberman agreed to commit 100% of her time to our matters.

On March 11, 2025, the compensation committee of the

board of directors set Drs.

Silberman and Picker annual base salaries to $ 495,000 and $ 120,000 , respectively, retroactive to January 1,

In March 2025, 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.

of the Compensation Committee, cash bonuses totaling $ 631,243 to the officers of the Company.

Scientific Advisory Board

4 unchanged sentences

Under this compensation policy, each scientific advisory board member was to receive annual cash compensation of $68,600.

25, 2022, Dr.

August 25, 2022, Dr.

Waldemar Priebe was 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 September 30, 2024, the Company has accrued $ 177,309 related

On March 14, 2024, the Board of Directors

terminated the cash compensation program for the Scientific Advisory Board.

As of March 31, 2025, the Company has accrued $ 177,309 related

Hsu’s Scientific Advisory Board compensation.

WP744 Portfolio (Berubicin)

On November 21, 2017, the Company entered into a Collaboration and

Asset Purchase Agreement with Reata Pharmaceuticals, Inc.

Through this agreement, the Company purchased all of

Reata’s rights, title, interest and previously conducted research and development results in the chemical compound commonly known

as Berubicin.

In exchange for these rights, the Company agreed to pay Reata an amount equal to 2.25% of the net sales of Berubicin for

a period of 10 years from the Company’s first commercial sale of Berubicin plus $10,000.

Reata also agreed to collaborate with the

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.

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 134 shares of the Company’s common stock valued at $67.50 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, 2024 and 2023, the Company recognized

$ 37,500 and $ 37,500 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 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

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.

As of December 31, 2021, the Company has received reports of the WPD expenditures related

to this agreement, has conducted due inquiry into validating those expenditures, and has determined that WPD has exercised commercially

reasonable development efforts and has therefore fulfilled the terms of the agreement necessary to secure their rights under the sublicense

in perpetuity subject to the ongoing obligations of the sublicense.

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.

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 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 an NDA in the United States.

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 demand.

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

On January 10, 2020, Company entered into a Patent and Technology License

Agreement (the “WP1244 Agreement”) with The Board of Regents of The University of Texas System, an agency of the State of

Texas, on behalf of The University of Texas M.

Anderson Cancer Center (“UTMDACC”).

Pursuant to the WP1244 Agreement, the

Company obtained a royalty-bearing, worldwide, exclusive license to certain intellectual property rights, including patent rights, related

to the Company’s recently announced WP1244 drug technology.

In consideration, the Company must make payments to UTMDACC including

an up-front license fee, annual maintenance fee, milestone payments and royalty payments (including minimum annual royalties) on sales

of licensed products developed under the WP1244 Agreement.

The term of the WP1244 Agreement expires on the last to occur of:

(a) the expiration

of all patents subject to the WP1244 Agreement, or (b) fifteen years after execution;

provided that UTMDACC has the right to terminate

this WP1244 Agreement in the event that the Company fails to meet certain commercial diligence milestones.

The commercial diligence milestones

are as follows (i) initiated PC toxicology to support filing of Investigational New Drug Application (“IND”) or New Drug Application

(“NDA”) for the Licensed Product within the eighteen (18) month period following the Effective Date (ii) file and IND for

the Licensed Product within three (3) year period following the Effective Date and (iii) Commencement of Phase I Study within the five

(5) year period following the Effective Date.

The Company has not met the commercial diligence milestones and has not paid the annual

maintenance fee required as of the date hereof.

On 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.

On May 25, 2024 the

WP1244 Agreement was terminated.

There are no termination penalty provisions in the Agreement.

During the nine months ended September

30, 2024 and 2023, the Company paid $52,537 and $45,092, respectively.

Nasdaq Capital Markets Listing Qualifications

On September 12, 2024, the Company received a letter from the Staff

of Nasdaq notifying the Company that for the previous 30 consecutive business days the Company’s common stock had not maintained

a closing bid price of $1.00 per share (the “Minimum Bid Price Requirement”) required for continued listing on The Nasdaq

Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2).

Normally, a company would be afforded a 180-calendar day period to demonstrate

compliance with the Minimum Bid Price Requirement.

However, pursuant to Listing Rule 5810(c)(3)(A)(iv), the Company is not eligible

for any compliance period specified in Rule 5810(c)(3)(A) because the Company effected one or more reverse stock splits over the prior

two-year period with a cumulative ratio of 250 shares or more to one.

The Company requested a hearing before a Hearings Panel (the “Panel”),

but prior to such hearing, on October 30, 2024 the Panel provided the Company a temporary exception to regain compliance with the Minimum

Bid Price Requirement until March 11, 2025.

The Panel noted that it reserves the right to reconsider the terms of this exception based

on any event, condition or circumstance that exists or develops that would, in the opinion of the Panel, make continued listing of the

Company’s securities on Nasdaq inadvisable or unwarranted.

The Panel notification advised the Company that the Nasdaq Listing and

Hearing Review Council may, on its own motion, determine to review any Panel decision within 45 calendar days after issuance of the written

If the Listing Council determines to review the Panel’s decision in the Company’s matter, it may affirm, modify,

reverse, dismiss or remand the decision to the Panel.

Cortice Biosciences, Inc.

Exclusive License Agreement

On July 29, 2024, the Company entered into an Exclusive License Agreement

with Cortice Biosciences, Inc.

(“Cortice”) pursuant to which Cortice granted the Company an exclusive license to the intellectual

property rights related to certain patents around the compound TPI 287 in the United States, Canada, Mexico and Japan.

The term of the

license will expire, other than due to a breach of the Cortice Agreements, at the end of the royalty term with respect to any licensed

product in any of the included territories, which begins upon the first commercial sale in such territory and ends on the latest of (i)

ten years after such sale, (ii) the expiration of regulatory or marketing exclusivity for such licensed product in such country, or (c)

the expiration of the last to expire valid patent claim in such country covering such licensed product.

Pursuant to the Cortice Agreements,

the Company agreed to issue Cortice 11,468 shares of the Company’s common stock upon the closing of the transaction, which occurred

on July 29, 2024, and 867 shares of Company common stock upon the receipt of shareholder approval of such issuance as required by the

rules of the Nasdaq Stock Market.

The Company also agreed to make milestone payments to Cortice in either cash or shares of Company common

stock (at Cortice’s option) upon:

(i) meeting the primary endpoint a pivotal trial for a licensed product – either $15.0 million

or 8,223 shares of Company common stock;

(ii) FDA acceptance of an New Drug Application for a licensed product – either $30.0 million

or 16,446 shares of Company common stock;

(iii) the first commercial sale in the United States of a licensed product – either $45.0

million or 24,668 shares of Company common stock;

and (iv) the first commercial sale in Japan of a licensed product – either $10.0

million or 4,112 shares of Company common stock.

The Company’s obligation to pay the above milestones in Company common stock is

subject to the receipt of shareholder approval as required by the rules of the Nasdaq Stock Market.

The Company also agreed to pay Cortice

royalties on sales of licensed products of between 3.0%-7.5%.

Finally, to the extent Cortice is required to pay any milestone payments

to the original holder of the intellectual property rights licensed, the Company has agreed to make such payments to Cortice.

year ended December 31, 2024, the Company issued 11,468 Shares with a fair value of $ 596,303 pursuant to the Cortice Agreement.

March 31, 2025, there were no accruals related to the milestone payments.

Note 6 – Subsequent Events

On October 23, 2024, the Company entered into a placement agency agreement

(the “Placement Agency Agreement”) with A.G.P./Alliance Global Partners (the “Placement Agent”) in connection

with the sale by the Company of:

(i) 3,700,000 shares (the “Shares”) of the Company’s common stock, and (ii) pre-funded

warrants to purchase 13,947,060 shares of common stock (the “Pre-Funded Warrants”), in a registered direct offering (the “Offering”).

The per share purchase price of each share of common stock was $0.17 per share and the purchase price for each Pre-Funded Warrant was

$0.169 per Pre-Funded Warrant.

In connection with the Offering, the Company entered into a Securities Purchase Agreement with certain institutional

investors that participated in the Offering.

The gross proceeds to the Company from the Offering were approximately $3.0 million, before

deducting the Placement Agent fees and other estimated offering expenses payable by the Company.

Pursuant to the terms of the AGP ATM Sales Agreement, the Company originally

was permitted to sell from time to time through AGP, as sales agent or principal, shares of the Company’s common stock, par value

$0.001 per share with initial aggregate sales price of up to $5.2 million.

Subsequent to September 30, 2024, the Company has sold 6,393,243

Shares pursuant to the Agreement for net proceeds of approximately $1.6 million.

Subsequent to September 30, 2024, a total of 13,947,060 Warrants (exercisable

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

On May 13, 2025, the Company entered into a placement agency

agreement (the “Placement Agency Agreement”) with A.G.P./Alliance Global Partners (the “Placement Agent”) for

the public offering by the Company of (i) 325,000 shares of the Company’s common stock (ii) pre-funded warrants to purchase 3,627,570

shares of common stock (the “Pre-Funded Warrants”);

and (iii) Series F Warrants to purchase up to an aggregate of 3,952,570

shares of Common Stock (the “Common Warrants”).

The combined purchase price of one share of common stock and one accompanying

Common Warrant was $1.265 and the combined purchase price of one Pre-Funded Warrant and one accompanying Common Warrant was $1.264.

connection with the Offering, the Company entered into a Securities Purchase Agreement with the institutional investor that participated

in the Offering.

The gross proceeds to the Company from the Offering were approximately $5.0 million, before deducting the Placement

Agent fees and other estimated offering expenses payable by the Company.

On May 14, 2025, the Company received $2,193 in net cash proceeds from

the exercise of 2,192,570 Pre-Funded Warrants with an exercise price of $0.001.

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