What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-03-29 compared with 2023-03-27 · 662 added, 653 removed, 478 unchanged (73% of the section changed)

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and its subsidiaries (the “Company”) as

of December 31, 2022 and 2021, the related consolidated statements of operations and comprehensive loss, stockholders’ equity and

cash flows for each of the two years in the period ended December 31, 2022, and the related notes (collectively referred to as the “consolidated

financial statements”).

In our opinion, the consolidated financial statements referred to above present fairly, in all material

respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows

for each of the two years in the period ended December 31, 2022, in conformity with accounting principles generally accepted in the United

States of America.

of December 31, 2023 and 2022, the related consolidated statements of operations and comprehensive loss, stockholders’ equity

and cash flows for each of the two years in the period ended December 31, 2023, and the related notes (collectively referred to as the

“consolidated financial statements”).

In our opinion, the consolidated financial statements referred to above present fairly,

in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations

and its cash flows for each of the two years in the period ended December 31, 2023, in conformity with accounting principles generally

accepted in the United States of America.

consolidated financial statements are the responsibility of the Company’s management.

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We believe that our audits provide a reasonable basis for our opinion.

KMJ Corbin & Company LLP

Corbin & Company LLP

have served as the Company’s auditor since 2021.

March 29, 2024

Biopharma, Inc.

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Current assets:

Cash and cash equivalents

Tax receivable

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Total current assets

Deferred offering costs

Equipment, net

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Accounts payable and accrued expenses

Accrued interest

Total current liabilities

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no shares issued and outstanding

Common stock, $ 0.0001

Common stock, $ 0.0001 par value;

200,000,000 shares authorized;

shares issued and 13,892,122

shares outstanding at December 31, 2022, and 13,228,689

shares issued and outstanding at December 31, 2021

19,994,719 shares issued and 19,922,356 shares outstanding at December 31, 2023, and 13,964,485 shares issued and 13,892,122 shares outstanding at December 31, 2022

Additional paid-in capital

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( 37,985,247 )

Treasury stock at cost, 72,363 and no shares as of December 31, 2022 and 2021, respectively

Treasury stock at cost, 72,363 shares as of December 31, 2023 and 2022

Total Immix Biopharma, Inc.

stockholders’ equity

Non-controlling interests

Total stockholders’ equity

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( 8,218,948 )

Other expense:

Change in fair value of derivative liability

( 22,759,829 )

Loss on debt extinguishment

Other income (expense):

Interest income

Interest expense

Total other expense

( 23,025,852 )

Total other income (expense), net

Loss before provision for income taxes

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( 8,229,713 )

Other comprehensive loss:

Net loss attributable to non-controlling interests

Net loss attributable to Immix Biopharma, Inc.

common stockholders

( 15,426,048 )

( 8,229,713 )

Other comprehensive income (loss):

Foreign currency translation

Total other comprehensive loss

Total other comprehensive income (loss)

Comprehensive loss

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( 8,268,100 )

comprehensive loss attributable to non-controlling interests

Comprehensive loss attributable to Immix Biopharma, Inc.

common stockholders

$ ( 15,378,403 )

$ ( 8,268,100 )

Loss per common share - basic and diluted

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the Years Ended December 31, 2023 and 2022

Common Shares

Common Stock Amount

Additional Paid-in Capital

Accumulated Other Comprehensive Income

Accumulated Deficit

Treasury Shares

Treasury Stock Amount

Total Stockholders’ Equity

Stockholders of Immix Biopharma, Inc.

Accumulated Other

Comprehensive

Stockholders’

Balance December 31, 2021

$ ( 29,755,534 )

$ ( 4,730,584 )

Shares issued for cash proceeds, net of offering costs

Shares issued for conversion of convertible notes payable, related accrued interest and settlement of derivative liability

Relative fair value of warrants issued in connection with debt

Shares issued for cashless exercise of stock options

Shares issued for services

Repurchase of common shares

Stock-based compensation

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( 37,985,247 )

Shares issued for cash proceeds, net of offering costs

Shares issued for cashless exercise of stock options

( 37,985,247 )

Shares issued under ATM facilities for cash proceeds, net of offering costs

Shares and warrants issued under private placement for cash proceeds, net of offering costs

Shares issued for exercise of stock options

Nexcella shares issued for cash proceeds

Shares issued for services

Stock-based compensation

Repurchase of common shares

Non-controlling interests in subsidiary

( 15,426,048 )

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$ ( 53,411,295 )

$ ( 201,737 )

$ ( 53,411,295 )

$ ( 201,737 )

accompanying notes to the consolidated financial statements.

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Stock-based compensation

Shares issued for services

Convertible note issued in exchange for services

Change in fair value of derivative liability

Loss on debt extinguishment

Amortization of debt discount

Changes in operating assets and liabilities:

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Payments of deferred offering costs

Proceeds from convertible notes payable

Proceeds from exercise of stock options

Payments on note payable

Proceeds from sale of common stock, net of offering costs

Funds received for subsidiary private offering

Proceeds from sale of Nexcella common stock

Repurchase of common stock

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Effect of foreign currency on cash

Net change in cash

Net change in cash and cash equivalents

( 4,207,764 )

Cash - beginning of year

Cash - end of year

Cash and cash equivalents - beginning of year

Cash and cash equivalents - end of year

Supplemental Disclosures of Cash Flow Information:

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Supplemental Disclosures of Noncash Financing Information:

Relative fair value of warrants issued in connection with convertible debt

Debt discount related to derivative liabilities

Common stock issued upon conversion of notes payable, related accrued interest and settlement of derivative liability

Nexcella shares issued for funds previously received

Deferred offering costs charged against proceeds from sale of common stock

Cashless exercise of stock options

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Biopharma, Inc.

(the “Company”) is a clinical-stage pharmaceutical company organized as a Delaware corporation on

January 7, 2014 to focus on the development of therapies for patients with cancer and inflammatory diseases.

In August 2016, the

Company established a wholly-owned Australian subsidiary, Immix Biopharma Australia Pty Ltd.

(“IBAPL”), in order to

conduct various preclinical and clinical activities for its development candidates.

In November 2022, the Company established a

majority-owned subsidiary, Nexcella, Inc.

(formerly known as Immix Biopharma Cell Therapy, Inc.) (“Nexcella”) in order

to conduct various preclinical and clinical activities for its development candidates.

(the “Company”) is a clinical-stage biopharmaceutical pharmaceutical company organized as a Delaware corporation

on January 7, 2014 which is focused on developing a novel class of Tissue-Specific Therapeutics in oncology and immune-dysregulated diseases.

In August 2016, the Company established a wholly-owned Australian subsidiary, Immix Biopharma Australia Pty Ltd.

in order to conduct various preclinical and clinical activities for its development candidates.

In November 2022, the Company established

a majority-owned subsidiary, Nexcella, Inc.

(“Nexcella”), its cell therapy division.

2 – Summary of Significant Accounting Policies

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In addition, the Company is dependent upon the services of its employees, consultants and other third parties.

in late 2019, the outbreak of a novel strain of virus named SARS-CoV-2 (severe acute respiratory syndrome coronavirus 2), or coronavirus,

which causes coronavirus disease 2019, or COVID-19, has evolved into a global pandemic.

The extent of the impact of the coronavirus outbreak

on the Company’s business will depend on certain developments, including the duration and spread of the outbreak and the extent

and severity of the impact on the Company’s clinical trial activities, research activities and suppliers, all of which are uncertain

and cannot be predicted.

At this point, the extent to which the coronavirus outbreak may materially impact the Company’s financial

condition, liquidity or results of operations is uncertain.

The Company has expended and will continue to expend substantial funds to

complete the research, development and clinical testing of product candidates.

The Company also will be required to expend additional

funds to establish commercial-scale manufacturing arrangements and to provide for the marketing and distribution of products that receive

regulatory approval.

The Company may require additional funds to commercialize its products.

The Company is unable to entirely fund these

efforts with its current financial resources.

If adequate funds are unavailable on a timely basis from operations or additional sources

of financing, the Company may have to delay, reduce the scope of or eliminate one or more of its research or development programs which

may materially and adversely affect its business, financial condition and operations.

Company has expended and will continue to expend substantial funds to complete the research, development and clinical testing of product

The Company also will be required to expend additional funds to establish commercial-scale manufacturing arrangements and

to provide for the marketing and distribution of products that receive regulatory approval.

The Company may require additional funds

to commercialize its products.

The Company is unable to entirely fund these efforts with its current financial resources.

funds are unavailable on a timely basis from operations or additional sources of financing, the Company may have to delay, reduce the

scope of or eliminate one or more of its research or development programs which may materially and adversely affect its business, financial

condition and operations.

of Estimates in Financial Statement Presentation - The preparation of these consolidated financial statements in conformity with

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judgements when making estimates related to the valuation of deferred tax assets and related valuation allowances, accrual and prepayment

of research and development expenses, the valuation of derivative financial instruments, and stock-based compensation.

of research and development expenses, and stock-based compensation.

Actual results

could differ from those estimates.

Stock Split – On October 4, 2021, the Company effected a 3-for-1 forward stock split of its issued and outstanding common stock.

Accordingly, all share and per-share amounts relating to the common stock, stock options and warrants for all periods presented in the

accompanying consolidated financial statements have been retroactively adjusted, where applicable, to reflect the forward stock split.

of Consolidation – The accompanying consolidated financial statements include the accounts of Immix Biopharma, Inc., the accounts

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to the percentage of the economic or ownership interest retained in such entities by the respective non-controlling parties.

and Going Concern -

These consolidated financial statements have been prepared on a going concern basis, which assumes the Company will continue to

realize its assets and discharge its liabilities in the normal course of business.

The continuation of the Company as a going

concern is dependent upon the ability of the Company to obtain financing to continue operations.

In December 2021, the Company

received $ 18,648,934 in

net proceeds from the initial public offering (“IPO”) of its common stock (see Note 6).

In January 2022, the Company

raised additional net proceeds of $ 2,913,750 from

the exercise of the underwriter’s over-allotment option in connection with the Company’s IPO (See Note 6).

2023, the Company entered into an ATM Sales Agreement (the “Sales Agreement”) with ThinkEquity LLC (the “Sales

Agent”), pursuant to an “at the Market” offering program (the “ATM Facility”), under which the

Company, may, from time to time, issue and sell through the Sales Agent, up to $ 5

million of shares of the Company’s common stock in sales deemed to be

“at-the-market offerings” as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended

(see Note 10).

and Going Concern - These consolidated financial statements have been prepared on a going concern basis, which assumes

the Company will continue to realize its assets and discharge its liabilities in the normal course of business.

The continuation of the

Company as a going concern is dependent upon the ability of the Company to obtain financing to continue operations.

In December 2021,

the Company received $ 18,648,934 in net proceeds from the initial public offering (“IPO”) of its common stock.

2022, the Company raised additional net proceeds of $ 2,913,750 from the exercise of the underwriter’s over-allotment option in

connection with the Company’s IPO.

On March 22, 2023, the Company entered into an ATM Sales Agreement (the “March Sales Agreement”)

with ThinkEquity LLC (the “Sales Agent”), pursuant to which the Company, issued and sold through the Sales Agent, approximately

$ 5 million of shares of the Company’s common stock in sales deemed to be “at-the-market offerings” as defined in Rule

415(a)(4) promulgated under the Securities Act of 1933, as amended (the “March ATM Facility”) (see Note 6).

As of June 15,

2023, the Company completed the equity raise pursuant to the March Sales Agreement and received net proceeds of $ 4,685,576 under the

March ATM Facility.

On July 14, 2023, the Company entered into an additional ATM Sales Agreement (the “July Sales Agreement”)

with the Sales Agent, pursuant to which the Company, may, from time to time, issue and sell through the Sales Agent shares of the Company’s

common stock in sales deemed to be “at-the-market offerings” as defined in Rule 415(a)(4) promulgated under the Securities

Act of 1933, as amended (the “July ATM Facility”) (see Note 6).

Initially, the Company is eligible to sell up to $ 4,200,000

worth of shares of its common stock as the aggregate market value of the Company’s shares of common stock eligible for sale under

the July Sales Agreement is subject to the limitations of General Instruction I.B.6 of Form S-3 until such time that the Company’s

public float equals or exceeds $ 75.0 million.

In the event the aggregate market value of the Company’s outstanding common stock

held by non-affiliates equals or exceeds $ 75.0 million, then the one-third limitation on sales set forth in General Instruction I.B.6

of Form S-3 shall not apply to additional sales made pursuant to the July Sales Agreement.

August 2023, the Company sold (i) 3,241,076 shares of the Company’s common stock, par value $ 0.0001 , and (ii) Pre-Funded warrants

to purchase 1,913,661 shares of common stock (the “Pre-Funded Warrants”).

The Company received gross proceeds of $ 10 million

from the private placement and net proceeds of approximately $ 9.93 million, after deducting fees and expenses paid by the Company (the

“August 2023 Private Placement”) (see Note 6).

July 14, 2023 through February 5, 2024, the Company has sold 328,136

common shares pursuant to the July ATM Facility for net proceeds of $ 1,091,887 , after offering expenses.

On February 5, 2024, the Company suspended, and is not offering any shares of its common stock pursuant to, the prospectus

supplement dated July 14, 2023, relating to the July Sales Agreement by and between the Company and ThinkEquity LLC.

will not make any sales of common stock pursuant to the July Sales Agreement unless and until a new prospectus supplement is filed

with the SEC;

however, the Sales Agreement remains in full force and effect.

February 2024, the Company conducted an underwritten public offering of 5,535,055

shares of its common stock at the public offering

price of $ 2.71

per share, for the net proceeds of $ 13,566,697 ,

after underwriter discounts and offering expenses (the “Offering”).

Pursuant to the underwriting agreement, the Company

granted the underwriter a 30-day over-allotment option to purchase up to an additional 783,970

shares of the Company’s common stock, which was exercised in full on March 1, 2024 for net proceeds of $ 1,954,594 ,

after underwriting discounts and offering expenses (see Note 10).

Company has a history of, and expects to continue to report, negative cash flows from operations and a net loss.

While the Company’s

estimates of its operating expenses and working capital requirements could be incorrect and the Company may use its cash resources faster

than it anticipates, management believes that its cash on hand at December 31, 2022, and funds available to be raised from the

ATM Facility, will be sufficient to meet the Company’s working capital requirements through at least March 27,

Company’s estimates of its operating expenses and working capital requirements could be incorrect and the Company may use its

cash resources faster than it anticipates, management believes that its cash and cash equivalents on hand at December 31, 2023, and

funds raised from the July ATM Facility and the Offering (see Note 10), will be sufficient to meet the Company’s working capital

requirements through at least March 29, 2025.

Concentration

of Credit Risk - Periodically, the Company may carry cash balances at financial institutions in excess of the federally insured limit

of $ 250,000 , or the Australian insured limit of AUD 250,000 .

As of December 31, 2022, the Company had $ 13,975,090 in excess of the FDIC

insurance limit and no amounts in excess of the Australian insured limit.

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

– Equipment is recorded at cost and depreciated over its estimated useful

lives using the straight-line depreciation method as follows:

of Credit Risk - Periodically, the Company may carry cash and cash equivalents balances at financial institutions in excess of the

federally insured limit of $ 250,000 , or the Australian insured limit of AUD 250,000 .

At times, deposits held with financial institutions

may exceed the amount of insurance provided.

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

credit risk with regard to these deposits is not significant.

and Cash Equivalents – The Company’s cash equivalents include short-term highly liquid investments with an original maturity

of 90 days or less when purchased and are carried at fair value.

– Equipment is recorded at cost and depreciated over its estimated useful lives using the straight-line depreciation method

of Property and Equipment Estimated Useful Lives

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is measured by the amount by which the carrying amount of the asset exceeds its fair value.

Value of Financial Instruments – The carrying value of short-term instruments, including cash, tax receivable, accounts payable

and accrued expenses, and notes payable approximate fair value due to the relatively short period to maturity for these instruments.

Value of Financial Instruments – The carrying value of short-term instruments, including cash and cash equivalents, tax receivable, accounts

payable and accrued expenses approximate fair value due to the relatively short period to maturity for these

value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal

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3 – inputs to the valuation methodology are unobservable and significant to the fair value.

to the conversion of the convertible notes payable in December 2021, the Company was required to measure and record its derivative instruments

at fair value on a recurring basis (see Notes 4 and 5).

Instruments – Prior to the conversion of the convertible notes payable in December 2021, the Company evaluated its convertible

notes to determine if those contracts or embedded components of those contracts qualified as derivatives to be separately accounted for

in accordance with Accounting Standards Codification (“ASC”) 815, Derivatives and Hedging .

The result of this accounting

treatment was that the fair value of the embedded derivative was marked to market at each balance sheet date and recorded as a liability.

The change in fair value was recorded in the consolidated statements of operations and comprehensive loss as other income or expense.

Upon conversion of the derivative instrument, the instrument was marked to fair value at the conversion date and then that fair value

was reclassified to equity.

Company determined that the convertible notes contained embedded features that provided the noteholders with multiple settlement alternatives.

Certain of these settlement features provided the noteholders the right to receive cash or a variable number of shares upon the completion

of a capital raising transaction, change of control or default by the Company, which are referred to as “redemption features.”

redemption features of the convertible notes met the requirements for separate accounting and were accounted for as a single derivative

The derivative instrument was recorded at fair value at inception and was subject to remeasurement to fair value at each

balance sheet date, with any changes in fair value recognized in the statements of operations and comprehensive loss (see Notes 4 and

following fair value hierarchy table presents information about the Company’s asset measured at fair value on a recurring basis:

of Asset Measured at Fair Value on a Recurring Basis

Fair Value Measurements at December 31, 2023

Cash equivalents (money market funds)

of December 31, 2023, the Company had no liabilities required to be measured at fair value on a recurring basis.

of December 31, 2022, the Company had no assets or liabilities required to be measured at fair value on a recurring basis.

Taxes – The Company uses the asset and liability method of accounting for income taxes.

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upon examination and ultimate settlement with the tax authorities in the tax jurisdictions in which it operates.

Tax Incentive – IBAPL is eligible to receive a cash refund from the Australian Taxation Office for eligible

research and development (“R&D”) expenditures under the Australian R&D Tax Incentive Program (the

“Australian Tax Incentive”).

The Australian Tax Incentive is recognized as a reduction to R&D expense when there is

reasonable assurance that the relevant expenditure has been incurred, the amount can be reliably measured and that the Australian

Tax Incentive will be received.

The Company recognized reductions to R&D expense of $ 236,376

for the years ended December 31, 2022 and 2021, respectively.

Tax Incentive – IBAPL is eligible to receive a cash refund from the Australian Taxation Office for eligible research and development

(“R&D”) expenditures under the Australian R&D Tax Incentive Program (the “Australian Tax Incentive”).

The Australian Tax Incentive is recognized as a reduction to R&D expense when there is reasonable assurance that the relevant expenditure

has been incurred, the amount can be reliably measured and that the Australian Tax Incentive will be received.

The Company recognized

reductions to R&D expense of $ 1,064,745 and $ 236,376 for the years ended December 31, 2023 and 2022, respectively.

Offering Costs – The Company has capitalized qualified legal, accounting and other direct costs related to its efforts to raise

capital through the sale of its common stock under the July ATM Facility.

Deferred offering costs will be deferred and amortized ratably

upon sales under the July ATM Facility, and upon completion, they will be reclassified to additional paid-in capital as a reduction of

the July ATM proceeds.

If the Company terminates the July ATM Facility or there is a significant delay, all of the deferred offering

costs will be immediately written off to operating expenses.

As of December 31, 2023, $ 87,229 of deferred offering costs were capitalized

related to the July ATM Facility.

Compensation – Stock-based compensation expense represents the estimated grant date fair value of the Company’s equity

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of the Company’s therapy candidates, and for license and milestone costs related to in-licensed products and technology.

Costs incurred

in obtaining technology licenses are charged to research and development expense if the technology licensed has not reached commercial

feasibility and has no alternative future use.

Such licenses purchased by the Company require substantial completion of research and

development, regulatory and marketing approval efforts in order to reach commercial feasibility and has no alternative future use.

incurred in obtaining technology licenses are charged to research and development expense if the technology licensed has not reached

commercial feasibility and has no alternative future use.

Such licenses purchased by the Company require substantial completion of research

and development, regulatory and marketing approval efforts in order to reach commercial feasibility and has no alternative future use.

trial costs are a component of research and development expenses.

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balance sheets, as accumulated other comprehensive income.

Currency Translation and Transaction Gains (Losses) – The Company, and its majority-owned subsidiary Nexcella,

maintain their accounting records in U.S.

The Company’s operating wholly-owned subsidiary, IBAPL, is located in

Australia and maintains its accounting records in Australian Dollars, which is its functional currency.

Assets and liabilities of

the subsidiary are translated into U.S.

dollars at exchange rates at the balance sheet date, equity accounts are translated at

historical exchange rate and revenues and expenses are translated by using the average exchange rates for the period.

adjustments are reported as a separate component of other comprehensive income (loss) in the consolidated statements of operations

and comprehensive loss.

Foreign currency denominated transactions are translated at exchange rates approximating those in effect at

the transaction dates.

Exchange gains and (losses) are recognized in income and were $ 2,245

and $ ( 6,093 )

for the years ended December 31, 2022 and 2021, respectively, and are included in general and administrative expenses in the

accompanying statements of operations and comprehensive loss.

Per Common Share – Basic loss per common share is computed by dividing net loss available to common stockholders 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 December 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 stock options and warrants

for 2,168,742

and 1,686,984

common shares, respectively.

Currency Translation and Transaction Gains (Losses) – The Company, and its majority-owned subsidiary Nexcella, maintain their

accounting records in U.S.

The Company’s operating wholly-owned subsidiary, IBAPL, is located in Australia and maintains

its accounting records in Australian Dollars, which is its functional currency.

Assets and liabilities of the subsidiary are translated

dollars at exchange rates at the balance sheet date, equity accounts are translated at historical exchange rate and revenues

and expenses are translated by using the average exchange rates for the period.

Translation adjustments are reported as a separate component

of other comprehensive income (loss) in the consolidated statements of operations and comprehensive loss.

Foreign currency denominated

transactions are translated at exchange rates approximating those in effect at the transaction dates.

Exchange gains and (losses) are

recognized in income and were $ ( 992 ) and $ 2,245 for the years ended December 31, 2023 and 2022, respectively, and are included in general

and administrative expenses in the accompanying consolidated statements of operations and comprehensive loss.

Per Common Share - Basic loss per common share is computed by dividing net loss attributable to common stockholders 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 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.

Basic weighted average shares outstanding for the year ended December 31, 2023 include 1,913,661 shares underlying

Pre-Funded warrants to purchase common shares.

As the shares underlying these Pre-Funded warrants can be issued for little consideration

(an exercise price per share equal to $ 0.0001 per share), these shares are deemed to be issued for purposes of basic loss per common

As of December 31, 2023 and 2022, the Company’s potentially dilutive shares and options, which were not included in the

calculation of net loss per share, included stock options and warrants for 2,910,061 and 2,168,742 common shares, respectively.

Growth Company Status - The Company is an “emerging growth company” (“EGC”) as defined in the Jumpstart Our

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of these exemptions up until it is no longer an EGC.

Accounting Pronouncements - In August 2020, the FASB issued Accounting Standards Update (“ASU”)

2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in

Entity’s Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s Own

ASU 2020-06 reduces the number of accounting models for convertible debt instruments and convertible preferred stock,

which results in fewer embedded conversion features being separately recognized from the host contract as compared with current U.S.

Additionally, ASU 2020-06 affects the diluted earnings per share calculation for instruments that may be settled in cash or shares and

for convertible instruments and requires enhanced disclosures about the terms of convertible instruments and contracts in an entity’s

ASU 2020-06 allows entities to use a modified or full retrospective transition method and is effective for smaller reporting

companies for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, with early adoption

The Company has chosen to early adopt the ASU as of January 1, 2022.

Upon adoption, no retrospective changes were required in

the Company’s consolidated financial statements.

Reclassifications

Certain reclassifications have been made to the prior

year financial statements to conform to the current year presentation.

These reclassifications had no effect on our previously reported

results of operations or accumulated deficit.

Accounting Pronouncements – In November

2023, the FASB issued ASU 2023-07 , Segment Reporting ( Topic 280 ) :

Improvements to Reportable Segment Disclosures,

which requires disclosure of incremental segment information on an annual and interim basis.

This ASU is effective for fiscal years

beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 on a retrospective basis.

The Company is currently evaluating the effect of this pronouncement on its disclosures.

In December 2023, the FASB issued ASU 2023-09 , Income Taxes ( Topic 740 ) :

Improvements to

Income Tax Disclosures, which expands the disclosures required for income taxes.

This ASU is effective for fiscal years beginning

after December 15, 2024, with early adoption permitted.

The amendment should be applied on a prospective basis while retrospective application

is permitted.

The Company is currently evaluating the effect of this pronouncement on its disclosures.

3 – Agreements with Nexcella Subsidiary

December 8, 2022, the Company entered a Founders Agreement with Nexcella (the “Nexcella Founders Agreement”).

Nexcella Founders Agreement provides that prior to a Qualified IPO (as defined in Nexcella’s Amended and Restated Certificate

of Incorporation, as amended (the “Nexcella COI”)) or Qualified Change in Control (as defined in the Nexcella COI), the

Company shall provide funds to Nexcella as requested by Nexcella, in good faith, to be evidenced by a senior unsecured promissory

In exchange for the time and capital expended in the formation of Nexcella and the identification of specific assets, the

acquisition of which benefit Nexcella, on December 21, 2022, the Company loaned Nexcella approximately $ 2.1 million,

evidenced by a senior unsecured promissory note, representing the up-front fee required to acquire Nexcella’s license

agreement with Hadasit Medica Research Services & Development, Ltd.

(“HADASIT”) and BIRAD Research and Development

(“BIRAD”), and for use as working capital for its research and development activities.

The note, which

matures on January 31, 2030, accrues interest at a rate of 7.875 % per annum and is convertible into shares of common stock of

Nexcella at a conversion price of $ 2.00 per share, subject to adjustment;

provided, however, that such note shall automatically

convert into shares of Nexcella common stock immediately prior to certain conversion triggers set forth in the note.

not prepay the note without the Company’s prior written consent.

The Nexcella Founders Agreement has a term of 15 years,

which, upon expiration, automatically renews for successive one-year periods unless terminated by the Company upon notice at least

six months prior to the end of the term or upon the occurrence of a Change of Control (as defined in the Nexcella Founders

In connection with the Nexcella Founders Agreement, the Company was issued 250,000 shares

of Nexcella’s Class A Preferred Stock, 1,000,000 shares

of Nexcella’s Class A Common Stock, and 5,000,000 shares

of Nexcella’s common stock.

The Class A Preferred Stock is identical to the common stock other than as to conversion rights

and the PIK Dividend right (as defined below) and voting rights.

December 8, 2022, the Company entered into a Founders Agreement with Nexcella (the “Nexcella Founders Agreement”).

Nexcella Founders Agreement provides that prior to a Qualified IPO (as defined in Nexcella’s Amended and Restated Certificate of

Incorporation, as amended (the “Nexcella COI”)) or Qualified Change in Control (as defined in the Nexcella COI), the Company

shall provide funds to Nexcella as requested by Nexcella, in good faith, to be evidenced by a senior unsecured promissory note.

for the time and capital expended in the formation of Nexcella and the identification of specific assets, the acquisition of which benefit

Nexcella, on December 21, 2022, the Company loaned Nexcella approximately $ 2.1 million, evidenced by a senior unsecured promissory note,

representing the up-front fee required to acquire Nexcella’s license agreement with Hadasit Medica Research Services & Development,

(“HADASIT”) and BIRAD Research and Development Company Ltd.

(“BIRAD”), and for use as working capital for

its research and development activities.

The note, which matures on January 31, 2030 , accrues interest at a rate of 7.875 % per annum

and is convertible into shares of common stock of Nexcella at a conversion price of $ 2.00 per share, subject to adjustment;

however, that such note shall automatically convert into shares of Nexcella common stock immediately prior to certain conversion triggers

set forth in the note.

Nexcella may not prepay the note without the Company’s prior written consent.

The Nexcella Founders Agreement

has a term of 15 years, which, upon expiration, automatically renews for successive one-year periods unless terminated by the Company

upon notice at least six months prior to the end of the term or upon the occurrence of a Change of Control (as defined in the Nexcella

Founders Agreement).

In connection with the Nexcella Founders Agreement, the Company was issued 250,000 shares of Nexcella’s Class

A Preferred Stock, 1,000,000 shares of Nexcella’s Class A Common Stock, and 5,000,000 shares of Nexcella’s common stock.

The Class A Preferred Stock is identical to the common stock other than as to conversion rights, the PIK Dividend right (as defined below)

and voting rights.

share of Class A Preferred Stock is convertible, at the Company’s option, into one fully paid and nonassessable share of Nexcella’s

4 unchanged sentences

shares of Nexcella common stock (“PIK Dividends”) such that the aggregate number of shares of common stock issued pursuant

to such PIK Dividend is equal to 2.5 %

of Nexcella’s fully-diluted outstanding capitalization on the date that is one business day prior to any PIK Dividend Payment Date.

In addition, as a holder of Class A Preferred Stock, the Company shall be entitled to cast for each share of Class A Preferred Stock held as

of the record date for determining stockholders entitled to vote on matters presented to the stockholders of Nexcella, the number of

votes that is equal to 1.1 times a fraction, the numerator of which is the sum of (A) the shares of outstanding Nexcella common stock

and (B) the whole shares of Nexcella common stock into which the shares of outstanding Nexcella Class A Common Stock and the Class A

Preferred Stock are convertible and the denominator of which is number of shares of outstanding Nexcella Class A Preferred Stock.

to such PIK Dividend is equal to 2.5 % of Nexcella’s fully-diluted outstanding capitalization on the date that is one business day

prior to any PIK Dividend Payment Date.

In addition, as a holder of Class A Preferred Stock, the Company will be entitled to cast for

each share of Class A Preferred Stock held as of the record date for determining stockholders entitled to vote on matters presented to

the stockholders of Nexcella, the number of votes that is equal to 1.1 times a fraction, the numerator of which is the sum of (A) the

shares of outstanding Nexcella common stock and (B) the whole shares of Nexcella common stock into which the shares of outstanding Nexcella

Class A Common Stock and the Class A Preferred Stock are convertible and the denominator of which is the number of shares of outstanding

Nexcella Class A Preferred Stock.

share of Class A Common Stock is convertible, at the Company’s option, into one fully paid and nonassessable share of Nexcella’s

common stock, subject to certain adjustments.

In addition, upon a Qualified IPO (as defined the Nexcella COI”) or Qualified Change in Control (as defined in the Nexcella

COI), the shares of Class A Common Stock, will automatically convert into one fully paid and nonassessable share of Nexcella’s

common stock;

provided however, if at that time, the Class A Common Stock is not then convertible into a number of shares of Nexcella

common stock (or such other capital stock or securities at the time issuable upon the conversion of the Class A Common Stock) that have

(a) in the case of a Qualified IPO, at least $ 5,000,000

based on the initial offering price in such initial

public offering, or (b) in the case of a Qualified Change in Control, at least $ 5,000,000

in cash or at least $ 5,000,000

of equity based on the implied value of a share

of Nexcella common stock resulting from the price paid upon the consummation of such Qualified Change of Control, the Class A Common

Stock will automatically convert into such number of shares of Nexcella common stock (or such other capital stock or securities at the

time issuable upon the conversion of the Class A Common Stock) that have a value of $ 5,000,000

based in the initial offering price in such initial

public offering or the implied value of a share of Nexcella common stock resulting from the price paid upon the consummation of such

Qualified Change of Control (or if such Qualified Change of Control results in the Class A Shares being exchanged solely for cash, then

The Company shall be entitled to

cast such number of votes equal to the number of whole

shares of Nexcella common stock into which the Company’s Class A Common Stock is convertible as of the record date for determining stockholders

entitled to vote on matters presented to the stockholders of Nexcella.

addition to the foregoing, the Company shall be entitled to one vote for each share of Nexcella common stock held by it.

In addition, upon a Qualified IPO (as defined in the Nexcella COI) or Qualified Change

in Control (as defined in the Nexcella COI), each share of Class A Common Stock will automatically convert into one fully paid and nonassessable

share of Nexcella’s common stock;

provided however, if at that time, the Class A Common Stock is not then convertible into a number

of shares of Nexcella common stock (or such other capital stock or securities at the time issuable upon the conversion of the Class A

Common Stock) that have a value of:

(a) in the case of a Qualified IPO, at least $5,000,000 based on the initial offering price in such

initial public offering, or (b) in the case of a Qualified Change in Control, at least $5,000,000 in cash or at least $5,000,000 of equity

based on the implied value of a share of Nexcella common stock resulting from the price paid upon the consummation of such Qualified

Change of Control, the Class A Common Stock will automatically convert into such number of shares of Nexcella common stock (or such other

capital stock or securities at the time issuable upon the conversion of the Class A Common Stock) that have a value of $5,000,000 based

on the initial offering price in such initial public offering or the implied value of a share of Nexcella common stock resulting from

the price paid upon the consummation of such Qualified Change of Control (or if such Qualified Change of Control results in the Class

A Shares being exchanged solely for cash, then $5,000,000 in cash) .

The Company is entitled to cast such number of votes equal to the

number of whole shares of Nexcella common stock into which the Company’s Class A Common Stock is convertible as of the record date

for determining stockholders entitled to vote on matters presented to the stockholders of Nexcella.

addition to the foregoing, the Company is entitled to one vote for each share of Nexcella common stock held by it.

Except as provided

by law or by the Nexcella COI, holders

of Nexcella Class A Common Stock and Class A Preferred Stock shall vote together with the holders of Nexcella common stock, as a single

by law or by the Nexcella COI, holders of Nexcella Class A Common Stock and Class A Preferred Stock shall vote together with the holders

of Nexcella common stock, as a single class.

additional consideration under the Nexcella Founders Agreement, Nexcella will also:

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and (ii) pay a cash

fee equal to 4.5% of Nexcella’s annual Net Sales (as defined in the Nexcella Founders Agreement), payable on an annual basis, within 90 days of the end of each calendar year.

In the event of a Change of Control, Nexcella will pay a one-time change in control fee equal to five times the product of (A) Net Sales

for the 12 months immediately preceding the Change of Control and (B) 4.5% .

Management Services Agreement

fee equal to 4.5% of Nexcella’s annual Net Sales (as defined in the Nexcella Founders Agreement), payable on an annual basis, within

90 days of the end of each calendar year.

In the event of a Change of Control, Nexcella will pay a one-time change in control fee equal

to five times the product of (A) Net Sales for the 12 months immediately preceding the Change of Control and (B) 4.5% .

Services Agreement

as of December 8, 2022, the Company entered into a Management Services Agreement (the “Nexcella MSA”) with Nexcella.

Pursuant to the terms of the Nexcella MSA, the Company will render management, advisory and consulting services to Nexcella.

Services provided under the Nexcella MSA may include, without limitation, (i) advice and assistance concerning any and all aspects

of Nexcella’s operations, clinical trials, financial planning and strategic transactions and financings and (ii) conducting

relations on behalf of Nexcella with accountants, attorneys, financial advisors and other professionals (collectively, the

At the request of the Company, Nexcella shall utilize clinical research services, medical

education, communication and marketing services and investor relations/public relation services of companies or individuals

designated by the Company, provided those services are offered at market prices.

In consideration for the Services, Nexcella will pay the Company an

annual base management and consulting fee of $ 500,000

(the “Annual Consulting Fee”), payable in advance in equal quarterly installments on the first business day of each

calendar quarter in each year;

provided, however, that such Annual Consulting Fee shall be increased to $ 1.0

million for each calendar year in which Nexcella has Net Assets (as defined in the Nexcella MSA) in excess of $ 100

million at the beginning of the calendar year.

Notwithstanding the foregoing, the first Annual Consulting Fee payment shall be made

on the first business day of the calendar quarter immediately following the completion of the first equity financing for Nexcella

that is in excess of $ 10

million in gross proceeds.

The first payment shall include all amounts in arrears from the effective date of the Nexcella MSA

through such payment as well as the amounts in advance for such first quarterly payment.

Actual and direct out-of-pocket expenses

reasonably incurred by the Company in performing the Services shall be reimbursed to the Company

The Nexcella MSA shall continue for a period of five years from the effective date thereof and shall be automatically extended

for additional five year periods unless the Company and Nexcella provide written notice to not extend the term at least 90 days prior

to the end of the term, unless the Nexcella MSA is terminated earlier by mutual agreement of the Company and Nexcella.

4 – Notes Payable

September 1, 2016, the Company entered into a secured convertible promissory note, as amended, with an entity affiliated with a stockholder

of the Company for aggregate borrowings of $ 3,000,000 (as amended, “2016 Note”).

The 2016 Note was scheduled to mature on

March 31, 2022 , and bore interest at the applicable federal rate per annum.

The 2016 Note was secured by (i) all of the Company’s

purchased equipment (to the extent not already encumbered) and (ii) any amounts received as a tax rebate or incentive during the term

of the 2016 Note.

On December 20, 2021, the outstanding principal and accrued interest were converted into shares of the Company’s

common stock in connection with the Company’s IPO (see below).

October 30, 2018, the Company entered into an unsecured convertible promissory note in the principal amount of $ 250,000 (as amended,

“2018 Note”).

The 2018 Note was scheduled to mature on March 31, 2022 , and bore interest at 4 % per annum.

On December 20,

2021, the outstanding principal and accrued interest were converted into shares of the Company’s common stock in connection with

the Company’s IPO (see below).

October 30, 2019, the Company entered into a series of unsecured convertible promissory notes (as amended, “2019 Notes”)

in the aggregate principal amount of $ 800,000 .

The 2019 Notes were scheduled to mature on March 31, 2022 and bore interest at 6 % per

On December 20, 2021, the outstanding principal and accrued interest was converted into shares of the Company’s common stock

in connection with the Company’s IPO (see below).

March and April 2021, the Company issued a series of unsecured convertible promissory notes (“2021A Notes”) in the aggregate

principal amount of $ 260,000 to the Company’s Chief Financial Officer and Alwaysraise LLC, an entity in which the Company’s

Chief Financial Officer is the sole member.

Of the $ 260,000 principal amount, the Company received $ 200,000 in cash proceeds and issued

a $ 60,000 note in exchange for services.

The 2021A Notes were scheduled to mature on March 1, 2023 , and bore interest at 6 % per annum.

In connection with the issuance of the 2021A Notes, the Company issued ten-year warrants to purchase 156,000 shares of the Company’s

common stock at an exercise price of $ 0.80 per share.

The warrants were valued using the Black-Scholes option pricing model with the

following inputs:

an expected and contractual life of 10 years, an assumed volatility of 117 %, a zero dividend rate, and a risk free

rate of 1.70 %.

The relative fair value of the warrants amounting to $ 74,603 was recorded to debt discount and was amortized to interest

expense through the date of the Company’s IPO, at which time the outstanding principal and accrued interest was converted into

shares of the Company’s common stock (see below).

2016 Note, 2018 Note, 2019 Notes and 2021A Notes are collectively referred to as the “Notes.” In the event that the Company

issued and sold shares of its equity securities (“Equity Securities”) to investors (the “Investors”) prior to

the maturity dates of the Notes in an equity financing with total proceeds to the Company of not less than $ 10,000,000 (including the

conversion of the Notes, other indebtedness or other convertible securities issued for capital raising purposes (e.g., Simple Agreements

for Future Equity)) (a “ Qualified Financing”), then the outstanding principal amount of the Notes and any unpaid accrued

interest would automatically convert in whole without any further action by the holders into Equity Securities sold in the Qualified

Financing at a conversion price equal to the lesser of (i) the price paid per share for Equity Securities by the Investors in the Qualified

Financing multiplied by 0.80, and (ii) the quotient resulting from dividing $ 10,000,000 by the number of pre-split outstanding shares

of the common stock of the Company immediately prior to the Qualified Financing (assuming conversion of all securities convertible into

common stock and exercise of all outstanding options and warrants, including all shares of common stock reserved and available for future

grant under any equity incentive or similar plan of the Company, and/or any equity incentive or similar plan created or increased in

connection with Qualified Financing, and including the shares of equity securities of the Company issued for capital raising purposes

(e.g., Simple Agreements for Future Equity)).

The issuance of Equity Securities pursuant to the conversion of the Notes were subject

to the same terms and conditions applicable to Equity Securities sold in the Qualified Financing.

the occurrence of a change of control prior to a Qualified Financing or maturity, the 2019 Notes and the 2021A Notes would upon the election

of the holders either (i) become due and payable upon closing of such change of control in cash in an amount equal to (a) the outstanding

principal amount plus any unpaid accrued interest, plus (b) a repayment premium equal to 200% of the outstanding principal amount, or

(ii) be converted such that the outstanding principal balance and any unpaid accrued interest would convert into shares of the Company’s

common stock at a conversion price equal to the quotient resulting from dividing $ 10,000,000 by the number of outstanding shares of common

stock of the Company immediately prior to the change of control (assuming conversion of all securities convertible into common stock

and exercise of all outstanding options and warrants, and including the shares of equity securities of the Company issuable upon the

conversion of notes, other indebtedness or other convertible securities issued for capital raising purposes).

December 20, 2021, in connection with the Company’s IPO, which was deemed a Qualified Financing, the Notes along with the corresponding

accrued interest, were automatically converted into an aggregate of 5,633,689 shares of the Company’s common stock.

of the conversion, the Company recorded a loss on debt extinguishment of $ 86,170 .

Notes contained embedded derivative instruments, including automatic conversion into equity securities upon completion of a Qualified

Financing, that were required to be bifurcated and accounted for separately as a single derivative instrument initially and subsequently

measured at fair value with the change in fair value recorded in other income (expense) in the accompanying consolidated statements of

operations and comprehensive loss.

The Company determined that the issuance date fair values of the derivative instruments for the 2016

Note, 2018 Note, and 2019 Notes, was nominal based on its assumptions of probabilities of a Qualified Financing or change of control

For the 2021A Notes issued during March and April 2021, the Company recorded the fair value of the derivative instruments

of $ 80,000 , as a debt discount on the issuance dates which was amortized to interest expense through the date of the Company’s

IPO, at which time the 2021A Notes were converted into shares of the Company’s common stock.

During the year ended December 31,

2021, the Company recognized expense of $ 22,759,829 related to the change in fair value of the derivative instruments.

Upon the conversion

of the Notes, the Company reclassified the estimated fair value of the derivative liability of $ 23,414,829 to additional paid-in capital.

expense related to the Notes was $ 118,904 for the year ended December 31, 2021.

Amortization of the debt discounts related to the 2021A

Notes was $ 58,157 for the year ended December 31, 2021.

Payable – Related Party

September 14, 2014, the Company issued an unsecured promissory note in the principal amount of $ 50,000 to a stockholder of the Company.

The note matured on September 14, 2017 and bore interest at 2.5 % per annum.

On June 9, 2021, the note was amended to extend the maturity

date to September 14, 2022 .

On May 26, 2022, the Company repaid the outstanding principal balance and accrued interest in full.

December 31, 2022 and 2021, the outstanding principal balance on this note was $ 0 and $ 50,000 , respectively.

expense related to the note was $ 497 and $ 1,250 for the years ended December 31, 2022 and 2021, respectively.

As of December 31, 2022

and 2021, accrued interest on the note was $ 0 and $ 9,099 , respectively.

5 – Fair Value Measurements

of December 31, 2022 and 2021, the Company had no assets or liabilities required to be measured at fair value on a recurring basis.

fair value of the embedded derivative instrument identified in the Notes was estimated using a two-step approach to valuation, employing

a probability-weighted scenario valuation method and then comparing the instrument’s value with-and-without the derivative features

in order to estimate their combined fair value, using unobservable inputs, which are classified as Level 3 within the fair value hierarchy.

In order to estimate the fair value of the Notes, the Company estimated the future payoff in each scenario, discounted them to a present

value and then probability weighted them based upon the Company’s best likelihood of each event occurring.

The primary inputs for

the valuation approach included the probability of achieving various settlement scenarios that provide the noteholders the rights or

the obligations to receive cash or a variable number of shares upon the completion of a Qualified Financing.

At December 31, 2020, the

Company estimated a 5% probability of a Qualified Financing occurring, a de minimis probability of a change of control occurring and

a 20% probability of bankruptcy or dissolution of the Company.

As of December 31, 2020, the embedded derivative was remeasured to $ 575,000 .

Immediately prior to the conversion of the Notes in connection with the Company’s IPO, the Company estimated a 100% probability

of a Qualified Financing occurring, a de minimis probability of a change of control occurring and a 0% probability of bankruptcy or dissolution

of the Company.

Accordingly, the estimated fair value of the embedded derivative was remeasured at $ 23,414,829 .

A loss of $ 22,759,829

related to the change in fair value of the derivative liability was recorded during the year ended December 31, 2021.

There were no transfers

among Level 1, Level 2 or Level 3 categories in the years ended December 31, 2022 and 2021.

following table provides a summary of changes in fair value of the Company’s Level 3 financial liabilities for the year ended December

of Changes in Fair Value of Level 3 Financial Liabilities

Balance, January 1, 2021

Additions – initial issuance of 2021A Notes recognized as debt discount

Loss from change in fair value included in earnings

Reclassification to additional paid-in capital upon conversion of convertible notes payable

( 23,414,829 )

Balance, December 31, 2021

to the terms of the Nexcella MSA, the Company will render management, advisory and consulting services to Nexcella.

Services provided

under the Nexcella MSA may include, without limitation, (i) advice and assistance concerning any and all aspects of Nexcella’s

operations, clinical trials, financial planning and strategic transactions and financings and (ii) conducting relations on behalf of

Nexcella with accountants, attorneys, financial advisors and other professionals (collectively, the “Services”).

At the request

of the Company, Nexcella will utilize clinical research services, medical education, communication and marketing services and investor

relations/public relation services of companies or individuals designated by the Company, provided those services are offered at market

In consideration for the Services, Nexcella will pay the Company an annual base management and consulting fee of $ 500,000 (the

“Annual Consulting Fee”), payable in advance in equal quarterly installments on the first business day of each calendar quarter

in each year;

provided, however, that such Annual Consulting Fee will be increased to $ 1.0 million for each calendar year in which Nexcella

has Net Assets (as defined in the Nexcella MSA) in excess of $ 100 million at the beginning of the calendar year.

Notwithstanding the

foregoing, the first Annual Consulting Fee payment is not due until first business day of the calendar quarter immediately following

the completion of the first equity financing for Nexcella that is in excess of $ 10 million in gross proceeds, which hasn’t yet

The first payment will include all amounts in arrears from the effective date of the Nexcella MSA through such payment as well

as the amounts in advance for such first quarterly payment.

Actual and direct out-of-pocket expenses reasonably incurred by the Company

in performing the Services are required to be reimbursed to the Company by Nexcella.

The Nexcella MSA continues for a period of five

years from the effective date thereof and shall be automatically extended for additional five year periods unless the Company and Nexcella

provide written notice to not extend the term at least 90 days prior to the end of the term, unless the Nexcella MSA is terminated earlier

by mutual agreement of the Company and Nexcella.

4 – Prepaid Expenses and Other Current Assets

expenses and other current assets consist of the following as of December 31, 2023 and 2022:

of Prepaid Expenses and Other Current Assets

December 31, 2023

December 31, 2022

Prepaid research and development expenses

Prepaid insurance expense

Prepaid investor relations expense

Other current assets

Total prepaid expenses and other current assets

5 – Accounts Payable and Accrued Expenses

payable and accrued expenses consist of the following as of December 31, 2023 and 2022:

Schedule of Accounts Payable and

Accrued Expenses

December 31, 2023

December 31, 2022

Accounts payable

Accrued research and development expenses

Accrued professional services

Accrued compensation and related expenses

Other accrued expenses

Total accounts payable and accrued expenses

6 – Stockholders’ Equity

Company has authorized 200,000,000 shares of common stock and 10,000,000 shares of preferred stock each with a par value of $ 0.0001 per

ATM Sales Agreement

March 22, 2023, the Company entered into the March Sales Agreement with the Sales Agent pursuant to which the Company could offer and

sell, from time to time, through the Sales Agent, shares (the “March Shares”) of the Company’s common stock, par value

$ 0.0001 per share, having an aggregate offering price of up to $ 5,000,000 , subject to the terms and conditions set forth in the March

Sales Agreement.

The March Shares were offered and sold pursuant to the Company’s prospectus supplement, dated March 22, 2023,

filed by the Company with the SEC on March 22, 2023, including the accompanying base prospectus forming a part of the Company’s

Registration Statement on Form S-3 (File No.

333-269100) filed by the Company with the SEC on January 3, 2023 and declared effective

by the SEC on January 11, 2023.

The aggregate market value of March Shares eligible for sale under the Sales Agreement was subject to

the limitations of General Instruction I.B.6 of Form S-3.

the March Sales Agreement, the Sales Agent sold the March Shares in sales deemed to be “at-the-market offerings” as defined

in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended (the “Securities Act”), including sales made directly

on or through The Nasdaq Capital Market, in negotiated transactions at market prices prevailing at the time of sale or at prices related

to such prevailing market prices, and/or any other method permitted by law.

The Company could instruct the Sales Agent not to sell any

March Shares if the sales could not be effected at or above the price designated by the Company from time to time.

Company paid the Sales Agent a fixed commission rate of 3.75 % of the aggregate gross proceeds from the sale of the March Shares pursuant

to the March Sales Agreement.

In addition, the Company paid an expense deposit of $ 15,000 to the Sales Agent, which was applied against

the actual out-of-pocket accountable expenses that were paid by the Company to the Sales Agent in connection with the offering.

reimbursed the Sales Agent for all expenses related to the offering including, without limitation, the fees and expenses of the Sales

Agent’s legal counsel up to $ 50,000 and reimbursed the Sales Agent, upon request, for such costs, fees and expenses in an amount

not to exceed $ 7,500 on a quarterly basis for the first three fiscal quarters of each year and $ 10,000 for the fiscal fourth quarter

of each year.

Furthermore, the Company provided indemnification and contribution to the Sales Agent with respect to certain liabilities,

including liabilities under the Securities Act.

the year ended December 31, 2023, the Company sold 2,263,868 March Shares pursuant to the March ATM Facility for net cash proceeds of

$ 4,811,393 , after deducting commissions.

In addition, the Company amortized $ 125,817 of deferred offering costs for fees paid related

to the March ATM Facility.

ATM Sales Agreement

July 14, 2023, the Company entered into the July Sales Agreement with the Sales Agent pursuant to which the Company may offer and sell,

from time to time, through the Sales Agent, shares (the “July Shares”) of the Company’s common stock, par value $ 0.0001

per share, subject to the terms and conditions set forth in the Sales Agreement.

Initially, the Company is eligible to sell up to $ 4,200,000

worth of shares of its common stock as the aggregate market value of the Company’s shares of common stock eligible for sale under

the July Sales Agreement is subject to the limitations of General Instruction I.B.6 of Form S-3 until such time that the Company’s

public float equals or exceeds $ 75.0 million.

In the event the aggregate market value of the Company’s outstanding common stock

held by non-affiliates equals or exceeds $ 75.0 million, then the one-third limitation on sales set forth in General Instruction I.B.6

of Form S-3 shall not apply to additional sales made pursuant to the July Sales Agreement.

The July Shares will be offered and sold pursuant

to the Company’s prospectus supplement, dated July 14, 2023, filed by the Company with the SEC on July 14, 2023, including the

accompanying base prospectus forming a part of the Company’s Registration Statement on Form S-3 (File No.

333-269100) filed by

the Company with the SEC on January 3, 2023 and declared effective by the SEC on January 11, 2023.

the July Sales Agreement, the Sales Agent may sell the July Shares in sales deemed to be “at-the-market offerings” as defined

in Rule 415(a)(4) promulgated under the Securities Act, including sales made directly on or through The Nasdaq Capital Market or any

other existing trading market for the Company’s common stock, in negotiated transactions at market prices prevailing at the time

of sale or at prices related to such prevailing market prices, and/or any other method permitted by law.

The Company may instruct the

Sales Agent not to sell any July Shares if the sales cannot be effected at or above the price designated by the Company from time to

Company will pay the Sales Agent a fixed commission rate of 3.75 % of the aggregate gross proceeds from the sale of the July Shares pursuant

to the Sales Agreement.

The Company has paid an expense deposit of $ 15,000 to the Sales Agent, which will be applied against the actual

out-of-pocket accountable expenses that will be paid by the Company to the Sales Agent in connection with the offering.

The Company has

agreed to reimburse the Sales Agent for all expenses related to the offering including, without limitation, the fees and expenses of

the Sales Agent’s legal counsel up to $ 50,000 , and shall reimburse the Sales Agent, upon request, for such costs, fees and expenses

in an amount not to exceed $ 7,500 on a quarterly basis for the first three fiscal quarters of each year and $ 10,000 for the fiscal fourth

quarter of each year.

The Company has also agreed to provide indemnification and contribution to the Sales Agent with respect to certain

liabilities, including liabilities under the Securities Act.

the year ended December 31, 2023, the Company sold 259,834

July Shares pursuant to the July ATM Facility for net cash proceeds of $ 801,442 ,

after deducting commissions.

In addition, the Company recorded offering expenses of $ 26,478

and amortized $ 21,570

of deferred offering costs for fees paid related to the July ATM Facility.

2023 Private Placement

August 21, 2023, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with a certain

accredited investor (the “Purchaser”), pursuant to which the Company sold and issued to the Purchaser in a private placement

transaction (the “Private Placement”) (i) 3,241,076 shares (the “Shares”) of the Company’s common stock,

par value $ 0.0001 , and (ii) Pre-Funded warrants to purchase 1,913,661 shares of common stock (the “Pre-Funded Warrants”).

The purchase price per share of common stock was $ 1.94 per share (the “Purchase Price”) and the purchase price for the Pre-Funded

Warrants was the Purchase Price minus $ 0.0001 per Pre-Funded Warrant.

The Company received gross proceeds of $ 10 million from the Private

Placement and net proceeds of $ 9,934,153 , after deducting fees and expenses paid by the Company.

The Company intends to use the proceeds

of the August 2023 Private Placement for working capital and general corporate purposes.

Pre-Funded Warrants have a per share exercise price of $ 0.0001 , subject to proportional adjustments in the event of stock splits or combinations

or similar events.

The Pre-Funded Warrants will not expire until exercised in full.

The Pre-Funded Warrants contain a “blocker”

provision providing that a holder (together with its affiliates) may not exercise any portion of a warrant to the extent that the holder

would own more than 19.99 % of the outstanding shares of common stock of the Company.

The Securities Purchase Agreement contains customary

representations and warranties and agreements of the Company and the Purchaser and customary indemnification rights and obligations of

Shares and Pre-Funded Warrants, and the common stock issuable upon the exercise of the Pre-Funded Warrants, have not been registered

under the Securities Act of 1933, as amended (the “Securities Act”), and were offered pursuant to the exemption from registration

provided in Section 4(a)(2) under the Securities Act.

to the Securities Purchase Agreement, the Company filed with the SEC a Registration Statement on Form S-3 (File No.

333-274684) on September

25, 2023 and declared effective by the SEC on September 28, 2023, to register the resale of the Shares and Pre-Funded Warrants.

of the Pre-Funded Warrants have been exercised to date.

Common Stock Issuances

the year ended December 31, 2023, the Company entered into various marketing services agreements, whereby the Company agreed to issue

shares of its common stock, valued at $ 247,500 ,

in exchange for future services.

As of December 31, 2023, the Company has issued 122,300

shares of the Company’s common stock pursuant

to the marketing services agreements .

During the year ended December 31, 2023, the Company recorded stock-based compensation expense

related to the fair value of the shares of common stock.

As of December 31, 2023, the Company has $ 14,876

of unamortized stock-based compensation which will be amortized over the remaining service period.

the year ended December 31, 2023, the Company entered into various marketing services agreements, whereby the Company issued 123,396 shares

of its common stock valued at $ 322,299 for services received, which was recorded as stock-based compensation during the year ended December

the year ended December 31, 2023, the Company entered into a marketing services agreement, whereby the Company agreed to issue shares

of restricted common stock for services performed on a monthly basis valued at $ 22,500 based on the average closing price for the prior

10 trading days.

During the year ended December 31, 2023, the Company has issued 18,409 shares of its common stock for an aggregate value

of $ 67,500 pursuant to the agreement.

the year ended December 31, 2023, the Company issued 1,351 shares of its common stock upon the exercise of stock options for cash proceeds

January 5, 2022, the Company sold 630,000 shares of its common stock pursuant to the full exercise of the over-allotment option in connection

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the year ended December 31, 2022, the Company issued 62,532 shares of its common stock upon the cashless exercise of 140,992 stock options.

December 20, 2021, the Company closed on its IPO of 4,200,000 shares offered at a price of $ 5.00 for gross proceeds of $ 21,000,000 .

connection with the offering the Company paid $ 2,351,066 in offering costs resulting in net proceeds of $ 18,648,934 .

December 20, 2021, in connection with the IPO, the Notes along with the related accrued interest, were automatically converted into an

aggregate of 5,633,689 shares of the Company’s common stock.

December 20, 2021, the Company issued 20,000 shares of restricted common stock to an unrelated third party for entering into an investor

relations contract.

The stock was valued at a share price of $ 2.95 , the closing price of the Company’s common stock on date of

issuance, for a total value of $ 59,000 related to services which is included in general and administrative expenses.

Value of Common Stock – prior to establishing a public market

to establishing a public market for the Company’s common stock, the estimated fair value of the Company’s common stock was

determined by the Company’s Board of Directors as of the date of each option grant, with input from management, considering the

Company’s most recently available third-party valuations of common stock, and the Board of Directors’ assessment of additional

objective and subjective factors that it believed were relevant and which may have changed from the date of the most recent valuation

through the date of the grant.

valuations were performed in accordance with the guidance outlined in the American Institute of Certified Public Accountants’ Accounting

and Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation .

The Company’s common

stock valuations were prepared using a hybrid method that incorporated elements of both a probability-weighted expected return method

(“PWERM”) and an option pricing method (“OPM”).

OPM was based on the Black-Scholes option pricing model, which allows for the identification of a range of possible future outcomes.

The OPM treats common stock and convertible instruments as call options on the total equity value of a company, with exercise prices

based on the value thresholds at which the allocation among the various holders of a company’s securities changes.

A discount for

lack of marketability of the common stock was applied to arrive at an indication of value for the common stock.

involves a forward-looking analysis of the possible future outcomes of the enterprise.

This method is particularly useful when discrete

future outcomes can be predicted at a relatively high confidence level with a probability distribution.

Discrete future outcomes considered

under the PWERM included an initial public offering, as well as non-initial public offering market-based outcomes.

Determining the fair

value of the enterprise using the PWERM required the Company to develop assumptions and estimates for both the probability of an initial

public offering liquidity event and stay private outcomes, as well as the values the Company expected those outcomes could yield.

to establishing a public trading market of the Company’s capital stock, the Company’s Board of Directors exercised reasonable

judgment and considered a number of objective and subjective factors to determine its estimate of the fair value of the Company’s

common stock, including changes in the following factors between the date of the valuation and the grant date:

the Company’s business, financial condition and results of operations, including related industry trends affecting the Company’s

the likelihood of achieving a liquidity event, such as an initial public offering or sale of the Company, given prevailing market conditions;

the lack of marketability of the Company’s common stock;

the market performance of comparable publicly traded companies;

and global economic and capital market conditions and outlook.

assumptions underlying the Company’s Board of Directors’ valuations represented the Board’s best estimates, which involved

inherent uncertainties and the application of the Board’s judgment.

As a result, if factors or expected outcomes had changed or

the Company’s Board of Directors had used significantly different assumptions or estimates, the Company’s equity-based compensation

expense could have been materially different.

Following the completion of our IPO, the Company’s Board of Directors began determining

the fair value of the Company’s common stock based on the quoted market prices of its common stock.

2016, the Board of Directors of the Company approved the Immix Biopharma, Inc.

2016 Equity Incentive Plan (the “2016

The 2016 Plan allows for the Board of Directors to grant various forms of incentive awards covering up to 417,120

shares of common stock.

During the year ended December 31, 2021, the Board of Directors amended the 2016 Plan to increase the

aggregate number of shares available for issuance under the 2016 Plan to 1,761,120

shares of common stock.

On September 10, 2021, the Board of Directors approved the 2021 Equity Incentive Plan (the “2021

Plan”) which reserves and makes available for future issuance under the 2021 Plan (i) 900,000

shares of common stock, plus (ii) the number of shares of common stock reserved, but unissued under the 2016 Plan, and (iii) the

number of shares of common stock underlying forfeited awards under the 2016 Plan, provided that shares of common stock issued under

the 2021 Plan with respect to an Exempt Award (as defined in the 2021 Plan) shall not count against such share limit.

Subsequent to

September 10, 2021, no further awards shall be issued under the 2016 Plan, but all awards under the 2016 Plan which were outstanding

as of September 10, 2021 (including any Grandfathered Arrangement (as defined in the 2021 Plan)) shall continue to be governed by

the terms, conditions and procedures set forth in the 2016 Plan and any applicable award agreement.

As of December 31, 2022, there

awards remaining to be issued under the 2021 Plan.

the year ended December 31, 2022, the Company granted options to purchase 500,000

shares of the Company’s common stock to officers of the Company, and granted options to purchase 91,250

shares of the Company’s common stock to non-employee members of the Board of Directors and scientific advisors of the Company.

The exercise price of the options is $ 2.64 -$ 5.83

and the options expire ten

years following grant.

options vest in equal monthly installments beginning on the grant date ranging from 12 to 48 months .

the year ended December 31, 2021, the Company granted options to purchase 736,500

shares of the Company’s common stock to officers of the Company, and granted options to purchase 292,500

shares of the Company’s common stock to non-employee members of the Board of Directors and scientific advisors of the Company.

The exercise price of the options is $ 0.80 -$ 1.86

and the options expire ten

years following grant.

options vest in equal monthly installments beginning on the grant date ranging from 24 to 48 months .

Company estimated the fair value of the stock options using the Black-Scholes option pricing model.

The fair value of stock options

is being amortized on a straight-line basis over the requisite vesting period of the awards.

The fair value of stock options was

estimated using the following assumptions for the year ended December 31, 2022:

an expected and contractual life of 5.27 - 10

years, an assumed volatility of 117 %- 124 %,

dividend rate, a risk free rate of 1.70 %- 3.06 %,

and fair value of common stock of $ 2.21 -$ 5.50 .

The fair value of stock options was estimated using the following assumptions for the year ended December 31, 2021:

an expected and

contractual life of 10

years, an assumed volatility of 117 % - 128 % ,

dividend rate, a risk free rate of 1.37 %- 1.74 %,

and fair value of common stock of $ 0.83 .

2016 Equity Incentive Plan (the “2016 Plan”).

The 2016 Plan allows for the Board of Directors to grant various forms of incentive awards covering up to 417,120 shares of common stock.

During the year ended December 31, 2021, the Board of Directors amended the 2016 Plan to increase the aggregate number of shares available

for issuance under the 2016 Plan to 1,761,120 shares of common stock.

On September 10, 2021, the Board of Directors approved the 2021

Equity Incentive Plan (as amended and restated, the “2021 Plan”) pursuant to which it initially reserved and made available

for future issuance under the 2021 Plan (i) 900,000 shares of common stock, plus (ii) the number of shares of common stock reserved,

but unissued under the 2016 Plan, and (iii) the number of shares of common stock underlying forfeited awards under the 2016 Plan, provided

that shares of common stock issued under the 2021 Plan with respect to an Exempt Award (as defined in the 2021 Plan) would not count

against such share limit.

Subsequent to September 10, 2021, no further awards are to be issued under the 2016 Plan, but all awards under

the 2016 Plan which were outstanding as of September 10, 2021 (including any Grandfathered Arrangement (as defined in the 2021 Plan))

shall continue to be governed by the terms, conditions and procedures set forth in the 2016 Plan and any applicable award agreement.

April 24, 2023, the Company’s Board of Directors adopted the Immix Biopharma, Inc.

Amended and Restated 2021 Omnibus Equity Incentive

Plan (the “Amended 2021 Plan”) which, among other things, increased the number of shares of common stock that may be issued

under such plan by 1,034,561 shares, subject to stockholder approval.

On June 7, 2023, stockholders of the Company approved the Amended

As of December 31, 2023, there were 1,040,777 shares of the Company’s common stock remaining to be issued under the

Amended 2021 Plan.

the year ended December 31, 2023, the Compensation Committee of the Board of Directors approved the issuance of options to purchase 136,670

shares of the Company’s common stock to non-employee members of the Board of Directors of the Company and 586,000 shares of the

Company’s common stock to management of the Company.

The options have a term of 10 years, exercise prices ranging from $ 1.82 to

$ 1.95 per share and vest over periods of 10 to 48 equal monthly installments.

the year ended December 31, 2023, the Board of Directors approved the issuance of options to purchase 20,000 shares of the Company’s

common stock to a consultant of the Company with a term of 10 years and an exercise price of $ 1.95 per share, which options vest in 48

equal monthly installments.

the year ended December 31, 2022, the Company granted options to purchase 500,000 shares of the Company’s common stock to officers

of the Company, and granted options to purchase 91,250 shares of the Company’s common stock to non-employee members of the Board

of Directors and scientific advisors of the Company.

The exercise price of the options is $ 2.64 -$ 5.83 and the options expire ten years

following grant.

These options vest in equal monthly installments beginning on the grant date ranging from 12 to 48 months.

following table reflects the weighted average assumptions used to estimate the fair value of stock options granted during the years ended

December 31, 2023 and 2022:

of Weighted Average Assumption to Estimate the Fair Value of Stock Options

Expected life (years)

Risk-free interest rate

4.12 - 4.38 %

1.70 - 3.06 %

Dividend rate

The Company recognized stock-based compensation of $ 731,329

and $ 159,983 related to stock options for the years ended December 31, 2022 and 2021, respectively, which is included in general and administrative

As of December 31, 2022, the Company

had unrecognized stock-based compensation expense of $ 1,554,372 ,

related to unvested stock options, which is expected to be recognized over the weighted-average vesting period of 1.65 years.

following table summarizes the stock option activity under the 2021 Plan for the years ended December 31, 2022 and 2021:

and $ 476,746

related to stock options for the years ended December 31, 2023 and 2022, respectively, which is included in general and

administrative expenses.

of December 31, 2023, the Company had unrecognized stock-based compensation expense of $ 1,990,396 , related to unvested stock options,

which is expected to be recognized over the weighted-average vesting period of 2.73 years.

following table summarizes the stock option activity for the years ended December 31, 2023 and 2022:

of Stock Option Activity

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following table discloses information regarding outstanding and exercisable options at December 31, 2023:

of Stock Outstanding and Exercisable

Schedule of Stock Outstanding and Exercisable

Exercise Price

Number of Option Shares

Weighted Average Exercise Price

Weighted Average Remaining Life (Years)

Number of Option Shares

Weighted Average Exercise Price

Exercise Price

intrinsic value is calculated as the difference between the exercise price of the underlying stock option and the fair value of the Company’s

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and outstanding was $ 6,423,762 and $ 12,567,619 , respectively.

The total intrinsic value of stock options exercised during the year ended

December 31, 2022 was $ 148,982 .

total intrinsic value of stock options exercised during the year ended December 31, 2023 was $ 2,827 .

January 5, 2022, in connection with the issuance of shares of the Company’s common stock pursuant to the exercise of the over-allotment

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and an exercise price of $ 6.25 per share, which warrants vested six months after the date of issuance.

March and April 2021, in connection with the issuance of the 2021A Notes as discussed in Note 4, the Company issued warrants for the

purchase of 156,000 shares of the Company’s common stock, with a term of 10 years and an exercise price of $ 0.80 per share which

vested immediately.

December 2021, in connection with the IPO discussed above, the Company issued warrants for the purchase of 210,000 shares of the Company’s

common stock, with a term of 5 years and an exercise price of $ 6.25 per share which vested six months after the date of issuance.

following table summarizes the stock warrant activity for the years ended December 31, 2023 and 2022:

8 unchanged sentences

Exercise Price

Number of Option Shares

Weighted Average Exercise Price

Weighted Average Remaining Life (Years)

Number of Option Shares

Weighted Average Exercise Price

Exercise Price

intrinsic value is calculated as the difference between the exercise price of the underlying stock warrant and the fair value of the

3 unchanged sentences

Equity Transactions

2022 Plan allows for the Board of Directors to grant various forms of incentive awards covering i) up to 375,000

shares of common stock and ii) up to 1,125,000

options to purchase shares of common stock.

As of December 31, 2022, there were 25,000

shares of common stock available for issuance under the Nexcella 2022 Plan.

incentive stock options have been issued pursuant to the Nexcella 2022 Plan as of December 31, 2022.

the year ended December 31, 2022, Nexcella entered into subscription agreements for the sale of 73,188

common shares of Nexcella, at a purchase price

of December 31, 2023, the Company’s controlling interest, on a fully dilutive basis, of Nexcella represents 91.6 % of Nexcella’s

total common stock equivalents outstanding.

Nexcella 2022 Equity Incentive Plan (the “2022 Plan”) allows for Nexcella’s Board of Directors to grant various forms

of incentive awards initially covering up to 375,000 shares of common stock.

On May 29, 2023, Nexcella’s Board of Directors approved

the Second Amended and Restated Nexcella 2022 Equity Incentive Plan, which submitted an increase to the number of shares of Nexcella

common stock issuable under the plan from 375,000 shares to 607,640 shares.

On August 11, 2023, Nexcella’s Board of Directors requested

the Third Amended and Restated 2022 Equity Incentive Plan, which increased the number of shares of Nexcella common stock issuable under

the plan from 607,640 to 800,000 shares.

The Nexcella shareholders subsequently approved the increase in Nexcella common stock issuable

under the plan to 800,000 .

As of December 31, 2023, there were 83,688 shares of common stock available for issuance under the Nexcella

the year ended December 31, 2023, Nexcella closed on its private offering for the sale of 100,152 common shares of Nexcella at a purchase

price of $ 6.49 per share for total proceeds of $ 650,000 .

The Company’s Chief Executive Officer purchased 7,704 shares of Nexcella’s

common stock for a purchase price of $ 50,000 in the private placement offering.

In addition, the Company’s Chief Financial Officer

through Alwaysraise, LLC and Alwaysraise Ventures I, L.P., entities affiliated with the Company’s Chief Financial Officer, purchased

an aggregate of 15,408 shares of Nexcella’s common stock in the private placement offering for $ 100,000 .

As of December 31, 2022,

Nexcella entered into subscription agreements for the sale of 73,188 shares of Nexcella’s common stock, at a purchase price of

$ 6.49 per share for total proceeds of $ 475,000 .

As of December 31, 2022, the offering had not yet closed, and the shares were not issued by Nexcella as of December 31, 2022, and accordingly,

the Company has recorded the proceeds of $ 475,000

in funds held for subsidiary private offering

in the accompanying consolidated balance sheet at December 31, 2022 (see Note 10).

December 8, 2022, Nexcella issued 350,000 shares of Nexcella restricted common stock to the officers of the Company for services to

be performed, which vest in 48 equal monthly installments.

As of December 31, 2022, the offering had not yet closed, and the shares were not issued

by Nexcella as of December 31, 2022, and accordingly, the Company recorded the proceeds of $ 475,000 in funds held for subsidiary private

offering at December 31, 2022.

March 13, 2023, pursuant to the terms of the Founders Agreement, Nexcella issued 167,566 shares of common stock to the Company as a PIK

Dividend based on the total dilutive shares of Nexcella outstanding as of March 12, 2023.

December 8, 2022, Nexcella issued 350,000 shares of Nexcella restricted common stock to the officers of the Company for services to be

performed, which vest in 48 equal monthly installments.

The stock was valued at a share price of $ 6.49 on the date of issuance, which

represents the most recent cash sales price of Nexcella’s common stock, for a total value of $ 2,271,500 related to services.

of which $ 47,323 was included in general and administrative expenses for the year ended December 31, 2022.

As of December 31, 2022, the Company

had unrecognized stock-based compensation expense of $ 2,224,177 ,

related to unvested restricted common stock, which is expected to be recognized over the remaining vesting period of 3.9 years.

the year ended December 31, 2023, the Board of Directors of Nexcella, granted 179,784 shares of restricted common stock to the non-employee

members of the Board of Directors for services to be performed, which vest in 24 equal monthly installments.

The stock was valued at

a share price of $ 6.49 on the date of issuance, which represents the most recent cash sales price of Nexcella’s common stock, for

a total value of $ 1,166,798 related to services.

the years ended December 31, 2023 and 2022, the Company recorded stock-based compensation expense of $ 950,672 and $ 47,323 , respectively,

related to the total value, which was included in general and administrative expenses.

The unrecognized stock-based compensation expense

of $ 2,440,303 related to unvested restricted common stock is expected to be recognized over the remaining vesting period of 2.42 years.

As of December 31, 2023, 144,628 shares of restricted common stock have vested with the remaining 385,156 restricted shares to vest over

the vesting period of 2.42 years.

the year ended December 31, 2023, the Board of Directors of Nexcella, granted 114,028 options to purchase shares of common stock to the

non-employee members of the Board of Directors for services to be performed, with a term of 10 years and an exercise price of $ 6.49 per

share, which options vest in 24 equal monthly installments.

the year ended December 31, 2023, the Board of Directors of Nexcella granted 72,500 options to purchase shares of common stock to three

consultants for services to be performed, with a term of 10 years and an exercise price of $ 6.49 per share, which options vest in 48

equal monthly installments.

Company recognized stock-based compensation of $ 261,284 related to stock options for the year ended December 31, 2023, which is included

in general and administrative expenses.

As of December 31, 2023, Nexcella had unrecognized stock-based compensation expense of $ 813,378 ,

related to unvested stock options, which is expected to be recognized over the weighted-average vesting period of 2.41 years.

following table summarizes the stock option activity for the year ended December 31, 2023 for Nexcella:

Schedule of Stock Option Activity

Average Exercise

Price Per Share

Outstanding and exercisable, January 1, 2023

Outstanding and expected to vest, December 31, 2023

following table discloses information regarding outstanding and exercisable options at December 31, 2023:

Schedule of Stock Outstanding and Exercisable

Exercise Price

7 – Licenses Acquired

December 8, 2022, Nexcella entered into a Research

and License agreement with HADASIT and BIRAD (collectively, the “Licensors”) to acquire intellectual property rights

pertaining to CAR-T (the “H&B License”).

Pursuant to the H&B License, Nexcella paid the Licensors an upfront

license fee of $ 1.5 million

in December 2022 (included in research and development expenses on the consolidated statements of operations and comprehensive

Additional quarterly

payments totaling approximately $13.0 million are due through September 2026 along

with an annual license fee of $ 50,000 .

Future royalty payments of 5 % are

due on net sales of licensed products, combined with sales milestone payments in the aggregate amount of up to $ 20 million when

annual net sales reach certain thresholds for each licensed product.

The royalties for each licensed product on a country-to-country

basis are to be paid through the latter of (a) the expiration of the last-to-expire valid claim under a licensed patent (if any) in

such country;

(b) the date of expiration of any other Exclusivity Right (as defined in the H&B License) or data protection

period granted by a regulatory or other governmental authority with respect to a licensed product that provides exclusivity in the

relevant country;

or (c) the end of a period of 15 years from the date of the First Commercial Sale (as defined in the H&B

License) of the applicable Licensed Product (as defined in the H&B License) in such country.

December 8, 2022, Nexcella entered into a Research and License agreement with HADASIT and BIRAD (collectively, the “Licensors”)

to acquire intellectual property rights pertaining to CAR-T (the “H&B License”).

Pursuant to the H&B License, Nexcella

paid the Licensors an upfront license fee of $ 1.5 million in December 2022 (included in research and development expenses on the consolidated

statements of operations and comprehensive loss).

Additional quarterly payments totaling approximately $13.0 million are due through

September 2026 along with an annual license fee of $50,000.

Future royalty payments of 5 % are due on net sales of licensed products,

combined with sales milestone payments in the aggregate amount of up to $ 20 million when annual net sales reach certain thresholds for

each licensed product.

The royalties for each licensed product on a country-to-country basis are to be paid through the latter of (a)

the expiration of the last-to-expire valid claim under a licensed patent (if any) in such country;

(b) the date of expiration of any

other Exclusivity Right (as defined in the H&B License) or data protection period granted by a regulatory or other governmental authority

with respect to a licensed product that provides exclusivity in the relevant country;

or (c) the end of a period of 15 years from the

date of the First Commercial Sale (as defined in the H&B License) of the applicable Licensed Product (as defined in the H&B License)

in such country.

the year ended December 31, 2023 and 2022, the Company recorded R&D expenses of $ 2,793,712 and $ 1,500,000 , respectively, related

to the license agreement.

8 – Income Taxes

1 unchanged sentence

At December 31, 2023, the Company had federal, state,

and foreign net operating loss (“NOL”) carryforwards of approximately $ 5,800,000 ,

and $ 1,500,000 ,

respectively.

federal loss carryforwards generated after 2017 of approximately $ 5,800,000

will carryforward indefinitely and can be used to offset up to 80% of future annual taxable income, while those loss carryforwards

generated prior to 2018 begin expiring in 2034, unless previously utilized .

loss carryforwards also begin expiring in 2034, unless previously utilized, while the Company’s

foreign loss carryforward do not expire .

The Company also has federal and California research and development credit

carryforwards totaling approximately $ 110,000

and $ 106,000 ,

respectively, at December 31, 2022.

and foreign net operating loss (“NOL”) carryforwards of approximately $ 11,800,000 , $ 11,800,000 and $ 3,100,000 , respectively.

The federal loss carryforwards generated after 2017 of approximately $ 11,200,000 will carryforward indefinitely and can be used to offset

up to 80% of future annual taxable income, while those loss carryforwards generated prior to 2018 begin expiring in 2034, unless previously

State loss carryforwards also begin expiring in 2034, unless previously utilized, while the Company’s foreign loss carryforward

does not expire .

The Company also has federal and California research and development credit carryforwards totaling approximately $ 241,000

and $ 219,000 , respectively, at December 31, 2023.

The Federal credits begin to expire in 2034, unless previously utilized, while the

State credits do not expire .

The Company also has foreign withholding tax carryforwards totaling $ 67,000

at December 31, 2022.

foreign withholding tax carryforward credit begins to expire in 2028, unless previously utilized .

The Company also has foreign withholding tax carryforwards totaling $ 100,000 at December 31, 2023.

withholding tax carryforward credit begins to expire in 2028, unless previously utilized.

Company’s NOL and credit carryforwards to offset future taxable income may be subject to a substantial annual limitation as a result

4 unchanged sentences

period resulting in an ownership change of more than 50 percent of the outstanding stock of a company by certain stockholders or public

Company’s federal income tax returns from 2019 forward, state income

tax returns from 2018 forward, and its Australian tax returns beginning in 2020 are subject to examination by tax authorities.

Company’s federal income tax returns from 2019 forward, state income tax returns from 2018 forward, and its Australian tax returns

beginning in 2020 are subject to examination by tax authorities.

reconciliation of the provision for income taxes to the amount computed by applying the statutory federal income tax rate to the loss

23 unchanged sentences

Stock-based compensation

Amortization of capitalized research and development

Valuation allowance

( 7,631,961 )

( 3,378,250 )

Net deferred tax assets

6 unchanged sentences

has been established by the Company to fully offset these net deferred tax assets.

the years ended December 31, 2022 and 2021, domestic and foreign pre-tax loss were:

the years ended December 31, 2023 and 2022, domestic and foreign pre-tax losses were as follow:

of Pre-tax Loss

54 unchanged sentences

On July 14, 2022, the Compensation Committee of the Board of Directors approved a new compensation package for Dr.

and on November 9, 2022, the Company entered into an amendment to the Rachman Employment Agreement dated

as of June 18, 2021 pursuant to which (i) Dr.

Rachman’s annual base salary was increased to $ 425,000 , retroactive as of

January 1, 2022 and (ii) entitling Dr.

Rachman to a performance-based bonus of up to 50 % of his base salary (subject to, and determined

by, the Board in its sole discretion) plus additional performance bonuses to be determined by the Board.

In addition, on July 14, 2022,

the Company issued Dr.

Rachman options to purchase up to 250,000 shares of the Company’s common stock at an exercise price of $ 2.64

Unless terminated by the Company without “cause” or by Dr.

Rachman with “good reason” (as such terms

are defined in the Rachman Employment Agreement), upon termination, Dr.

Rachman will be entitled only to his base salary through the

date of termination, valid expense reimbursements and unused vacation pay.

If terminated by the Company without “cause” or

Rachman with “good reason,” he is entitled to be paid his base salary through the end of the term at the rate of 150 %,

valid expense reimbursements and accrued but unused vacation pay.

Rachman’s employment agreement contains provisions for the

protection of the Company’s intellectual property and contains non-compete restrictions in the event of his termination other than

by the Company without “cause” or by Dr.

Rachman with “good reason” (generally imposing restrictions on (i) employment

or consultation with competing companies or customers, (ii) recruiting or hiring employees for a competing company and (iii) soliciting

or accepting business from our customers for a period of six months following termination) .

Pursuant to the Rachman Employment Agreement,

Rachman may serve as a consultant to, or on boards of directors of, or in any other capacity to other companies provided that they

will not interfere with the performance of his duties to the Company.

and on November 9, 2022, the Company entered into an amendment to the Rachman Employment Agreement dated as of June 18, 2021 pursuant

to which (i) Dr.

Rachman’s annual base salary was increased to $ 425,000 , retroactive as of January 1, 2022 and (ii) entitling Dr.

Rachman to a performance-based bonus of up to 50 % of his base salary (subject to, and determined by, the Board in its sole discretion)

plus additional performance bonuses to be determined by the Board.

In addition, on July 14, 2022, the Company issued Dr.

Rachman options

to purchase up to 250,000 shares of the Company’s common stock at an exercise price of $ 2.64 per share.

Unless terminated by the

Company without “cause” or by Dr.

Rachman with “good reason” (as such terms are defined in the Rachman Employment

Agreement), upon termination, Dr.

Rachman will be entitled only to his base salary through the date of termination, valid expense reimbursements

and unused vacation pay.

If terminated by the Company without “cause” or by Dr.

Rachman with “good reason,” he

is entitled to be paid his base salary through the end of the term at the rate of 150 % , valid expense reimbursements and accrued but

unused vacation pay.

On March 7, 2023, the Compensation Committee of the Board of Directors approved an increase in the annual base salary

and on May 12, 2023, the Company entered into an amendment to the Rachman Employment Agreement pursuant to which Dr.

annual base salary was increased to $ 446,000 , effective January 1, 2023.

Rachman’s employment agreement contains provisions

for the protection of the Company’s intellectual property and contains non-compete restrictions in the event of his termination

other than by the Company without “cause” or by Dr.

Rachman with “good reason” (generally imposing restrictions

on (i) employment or consultation with competing companies or customers, (ii) recruiting or hiring employees for a competing company

and (iii) soliciting or accepting business from our customers for a period of six months following termination).

Pursuant to the Rachman

Employment Agreement, Dr.

Rachman may serve as a consultant to, or on boards of directors of, or in any other capacity to, other companies

provided that they will not interfere with the performance of his duties to the Company.

On February 6, 2024, the Compensation Committee of the Board of Directors approved an increase in the annual base

salary for Dr.

Rachman to $ 475,000 , effective January 1, 2024.

March 18, 2021, the Company entered into a Management Services Agreement with Alwaysraise LLC, an entity which Gabriel Morris, the Company’s

10 unchanged sentences

dated as of March 24, 2021 pursuant to which (i) Mr.

Morris’ annual base salary was

increased to $ 425,000 , retroactive as of January 1, 2022 and (ii) entitling Mr.

Morris to a performance-based bonus of up to 50 % of his

base salary (subject to, and determined by, the Board in its sole discretion) plus additional performance bonuses to be determined by

In addition, on July 14, 2022, the company issued Mr.

Morris options to purchase up to 250,000 shares of the Company’s

common stock at an exercise price of $ 2.64 per share.

Unless terminated by the Company without “cause” or by Alwaysraise

LLC (as such terms are defined in the Morris MSA), upon termination, Mr.

Morris will be entitled only to his base salary through the

date of termination, valid expense reimbursements and unused vacation pay.

If terminated by the Company without “cause,”

he is entitled to be paid his base salary through the end of the term at the rate of 150 %, valid expense reimbursements and accrued but

unused vacation pay.

The Morris MSA contains provisions for the protection of the Company’s intellectual property and confidential

Morris’ annual base salary was increased to $ 425,000 , retroactive as of January

1, 2022 and (ii) entitling Mr.

Morris to a performance-based bonus of up to 50 % of his base salary (subject to, and determined by, the

Board in its sole discretion) plus additional performance bonuses to be determined by the Board.

In addition, on July 14, 2022, the company

Morris options to purchase up to 250,000 shares of the Company’s common stock at an exercise price of $ 2.64 per share.

Unless terminated by the Company without “cause” or by Alwaysraise LLC (as such terms are defined in the Morris MSA), upon

termination, Mr.

Morris will be entitled only to his base salary through the date of termination, valid expense reimbursements and unused

vacation pay.

If terminated by the Company without “cause,” he is entitled to be paid his base salary through the end of

the term at the rate of 150 % , valid expense reimbursements and accrued but unused vacation pay.

On March 7, 2023, the Compensation Committee

of the Board of Directors approved an increase in annual base salary, and on May 12, 2023, the Company entered into an amendment to the

Morris MSA pursuant to which the Mr.

Morris’ annual base salary was increased to $ 446,000 , effective January 1, 2023.

MSA contains provisions for the protection of the Company’s intellectual property and confidential information.

On February 6, 2024, the Compensation Committee of the Board of Directors approved an increase in the annual base

salary for Mr.

Morris to $ 475,000 , effective January 1, 2024.

June 24, 2021, the Company issued an offer letter to Graham Ross Oncology Consulting Services Ltd., a United Kingdom company, of which

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10 – Subsequent Events

Nexcella Private Placement Offering

January 12, 2023, the Company, through its majority-owned subsidiary, Nexcella, closed on a private placement offering in which it

sold an aggregate of 100,152 shares

of Nexcella’s common stock at a purchase price of $ 6.49 ,

for gross proceeds of approximately $ 650,000 .

The Company’s Chief Executive Officer purchased 7,704

shares of Nexcella’s common stock for a purchase price of $ 50,000

in the private placement offering.

In addition, the Company’s Chief Financial Officer through Alwaysraise, LLC and Alwaysraise

Ventures I, L.P., entities affiliated with the Company’s Chief Financial Officer, purchased an aggregate of 15,408

shares of Nexcella’s common stock in the private placement offering for $ 100,000.

Stock Issuance – Marketing Services Agreement

March 16, 2023, the Company, issued 6,700

shares of the Company’s common stock valued at $ 12,730 , pursuant to a marketing services agreement for future services to be

provided to the Company.

ATM Sales Agreement

March 22, 2023, the Company entered into an ATM Sales Agreement (the “Sales Agreement”) with ThinkEquity LLC (the “Sales

Agent”), pursuant to which the Company may offer and sell, from time to time, through the Sales Agent, shares (the “Shares”)

of the Company’s common stock, par value $ 0.0001 per share, having an aggregate offering price of up to $ 5,000,000 , subject to

the terms and conditions set forth in the Sales Agreement.

The Shares will be offered and sold pursuant to the Company’s prospectus

supplement, dated March 22, 2023, filed by the Company with the Securities and Exchange Commission (the “SEC”), to the prospectus

forming a part of the Company’s shelf Registration Statement on Form S-3 (File No.

333-269100) filed by the Company with the SEC

(the “Registration Statement”) on January 3, 2023 and declared effective by the SEC on January 11, 2023.

The aggregate market

value of Shares eligible for sale under the Sales Agreement will be subject to the limitations of General Instruction I.B.6 of Form S-3.

the Sales Agreement, the Sales Agent may sell the Shares in sales deemed to be “at-the-market offerings” as defined in Rule

415(a)(4) promulgated under the Securities Act of 1933, as amended (the “Securities Act”), including sales made directly

on or through The Nasdaq Capital Market or any other existing trading market for the Common Stock, in negotiated transactions at market

prices prevailing at the time of sale or at prices related to such prevailing market prices, and/or any other method permitted by law.

The Company may instruct the Sales Agent not to sell any Shares if the sales cannot be effected at or above the price designated by the

Company from time to time.

delivery of a placement notice and subject to the terms and conditions of the Sales Agreement, the Sales Agent will use commercially

reasonable efforts, consistent with its normal trading and sales practices, applicable state and federal law, rules and regulations,

and the rules of The Nasdaq Capital Market, to sell the Shares from time to time based upon the Company’s instructions, including

any price, time or size limits specified by the Company.

offering pursuant to the Sales Agreement will terminate upon the earlier of (i) the sale of all of the Shares subject to the Sales Agreement,

and (ii) termination of the Sales Agreement as permitted therein.

The Company may terminate the Sales Agreement in its sole discretion

at any time by giving ten days’ prior notice to the Sales Agent.

The Sales Agent may terminate the Sales Agreement under the circumstances

specified in the Sales Agreement and in its sole discretion at any time by giving ten days’ prior notice to the Company.

the Sales Agreement may be terminated upon mutual agreement of the Company and the Sales Agent.

Company will pay the Sales Agent a fixed commission rate of 3.75 % of the aggregate gross proceeds from the sale of the Shares pursuant

to the Sales Agreement.

The Company has paid an expense deposit of $ 15,000 to the Sales Agent, which will be applied against the actual

out-of-pocket accountable expenses that will be paid by the Company to the Sales Agent in connection with the offering.

The Company has

agreed to reimburse the Sales Agent for all expenses related to the offering including, without limitation, the fees and expenses of

the Sales Agent’s legal counsel up to $ 50,000 , and shall reimburse the Sales Agent, upon request, for such costs, fees and expenses

in an amount not to exceed $ 7,500 on a quarterly basis for the first three fiscal quarters of each year and $ 10,000 for the fiscal fourth

quarter of each year.

The Company has also agreed to provide indemnification and contribution to the Sales Agent with respect to certain

liabilities, including liabilities under the Securities Act.

Stock Issuance – Marketing Services Agreements

to December 31, 2023, the Company issued 15,486 shares of restricted common stock valued at $ 67,500 for investor relations services based

on the average closing price for the prior 10 trading days pursuant to a marketing services agreement entered into on July 25, 2023.

to December 31, 2023, the Company issued 70,000 shares of restricted common stock valued at $ 245,000 for investor relations services based

on the closing price pursuant to the extension of a marketing services agreement entered into on February 29, 2024.

Common Stock Issuance – July

to December 31, 2023, the Company sold a total of 68,302

shares of its common stock under the July ATM Facility for aggregate net proceeds of $ 425,728 after deducting commissions and SEC fees.

On February 5, 2024, the Company suspended, and is not offering any shares of its common stock pursuant to, the prospectus

supplement dated July 14, 2023, relating to the July Sales Agreement by and between the Company and ThinkEquity LLC.

will not make any sales of common stock pursuant to the July Sales Agreement unless and until a new prospectus supplement is filed

with the SEC;

however, the Sales Agreement remains in full force and effect.

Common Stock Issuance – Public Offering

On February 5, 2024, the Company

entered into an Underwriting Agreement (the “Agreement”) with Titan Partners Group LLC, a division of American Capital

Partners, LLC (the “Underwriter”), relating to an underwritten offering (the “Offering”) of 5,535,055

shares of common stock of the Company.

The public offering price is $ 2.71

per share of Common Stock and the Underwriter has agreed to purchase the Common Stock pursuant to the Underwriting Agreement at a

price of $ 2.5203

On February 8, 2024, the Company closed the offering and received net proceeds of $ 13,566,697 ,

after deducting underwriting discounts and commissions and estimated offering expenses.

Pursuant to the Agreement, the Company

granted the Underwriter a 30-day over-allotment option to purchase up to an additional 783,970

shares of Common Stock which was exercised in full on March 1, 2024 for net proceeds of $ 1,954,594 ,

after deducting underwriting discounts and offering expenses.

Common Stock Issuances – Option exercises

to December 31, 2023, the Company issued 834 shares of common stock upon the exercise of certain common stock options for cash proceeds

In January 2024, the Company entered

into a long-term operating lease agreement for 14,000 square feet of biopharmaceutical manufacturing space in California

under a non-cancelable operating lease that expires in December 2033.

Under the terms of the lease, the Company is required to pay monthly

base rents ranging from $ 11,900 to $ 16,218 , and pay its proportionate share of property taxes, insurance and normal maintenance costs.

The lease agreement includes two options to extend the lease for a term of five years each.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data