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Item 1. Financial Statements

2025-12-11 compared with 2025-09-09 · 531 added, 535 removed, 445 unchanged (71% of the section changed)

3 unchanged sentences

statements pursuant to the rules and regulations of the Securities and Exchange Commission.

The results of operations for the three and six

months ended July 31, 2025 and 2024 are not necessarily indicative of the results for the entire fiscal year or for any other period.

The results of operations for the three and nine

months ended October 31, 2025, and 2024 are not necessarily indicative of the results for the entire fiscal year or for any other period.

NUTRIBAND INC.

AND SUBSIDIARIES

BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS

CURRENT ASSETS:

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STOCKHOLDERS’ EQUITY:

Preferred stock, $ .001

par value, 10,000,000

shares authorized, 3,008,642

issued and outstanding as of July 31, 2025 and January 31, 2025, respectively

Common stock, $ .001

par value, 291,666,666

shares authorized, 12,034,883

and 11,107,210

shares issued at July 31, 2025 and January 31, 2025, respectively, 12,015,983

and 11,074,810

shares outstanding as of July 31, 2025 and January 31, 2025, respectively

Preferred stock, $ .001 par value, 10,000,000 shares authorized, 3,008,643 and - 0 - issued and outstanding as of October 31, 2025 and January 31, 2025, respectively

Common stock, $ .001 par value, 291,666,666 shares authorized, 12,174,883 and 11,107,210 shares issued at October 31, 2025 and January 31, 2025, respectively, 12,155,983 and 11,074,810 shares outstanding as of October 31, 2025 and January 31, 2025, respectively

Additional paid-in-capital

Accumulated other comprehensive loss

Treasury stock, 18,900

shares at cost, as of July 31, 2025 and January 31, 2025, respectively

Treasury stock, 18,900 and 32,400 shares at cost, as of October 31, 2025 and January 31, 2025,respectively

Accumulated deficit

( 45,724,209 )

( 38,462,636 )

Total Stockholders’ Equity

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

See notes to unaudited consolidated

financial statements

See notes to unaudited consolidated financial statements

NUTRIBAND INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

CONSOLIDATED STATEMENTS OF OPERATIONS

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

Costs and expenses:

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Loss from operations

( 3,880,336 )

( 1,426,841 )

( 7,297,046 )

( 4,726,060 )

Other income (expense):

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Loss before provision for income taxes

( 3,872,367 )

( 1,362,637 )

( 7,261,573 )

( 4,966,179 )

Provision for income taxes

$ ( 3,872,367 )

$ ( 1,362,637 )

$ ( 7,261,573 )

$ ( 4,966,179 )

Preferred shares dividend

Net loss available to common stockholders

- basic and diluted

Net loss per share available to common stockholders

- basic and diluted

Weighted average common shares outstanding

- basic and diluted

See notes to unaudited consolidated

financial statements

( 21,814,166 )

Net loss available to common stockholders- basic and diluted

$ ( 3,872,367 )

$ ( 1,362,637 )

$ ( 29,075,739 )

$ ( 4,966,179 )

Net loss per share attributable to common stockholders- basic and diluted

Weighted average common shares outstanding - basic and diluted

See notes to unaudited consolidated financial statements

NUTRIBAND INC.

AND SUBSIDIARIES

STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)

Six Months Ended July 31, 2025

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’

EQUITY (UNAUDITED)

Nine Months Ended October 31, 2025

Preferred Stock

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Balance, February 1, 2025

$ ( 38,462,636 )

$ ( 148,547 )

Treasury stock issued for services

Exercise of warrants

Warrants issued for services

Exercise of employee stock options

Employee stock options exercised for settlement of debt

Preferred Shares issued as Common stock dividend

Employee stock options issued for services

Cashless exercise of warrants

Balance, July 31, 2025

Six Months Ended July 31, 2024

( 7,261,573 )

Balance, October 31, 2025

$ ( 45,724,209 )

Nine Months Ended October 31, 2024

Preferred Stock

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Balance, February 1, 2024

$ ( 27,980,019 )

Proceeds from sale of common stock and warrants

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Common stock and warrants issued for conversion of debt

Treasury stock and warrants issued for services

Cashless exercise of warrants

Balance, July 31, 2024

Three Months Ended July 31, 2025

( 4,966,179 )

Balance, October 31, 2024

$ ( 32,946,198 )

Three Months Ended October 31, 2025

Preferred Stock

Comprehensive

Balance, May 1, 2025

Exercise of warrants

Balance, August 1, 2025

$ ( 41,851,842 )

Warrants issued for services

Exercise of employee stock options

Treasury stock issued for services

Preferred Shares issued as Common stock dividend

Cashless exercise of warrants

Balance, July 31, 2025

Three Months Ended July 31, 2024

Employee stock options exercised for settlement of debt

Employee stock options issued for services

( 3,872,367 )

Balance, October 31, 2025

$ ( 45,724,209 )

Three Months Ended October 31, 2024

Preferred Stock

Comprehensive

Balance, May 1, 2024

Common stock and warrants issued for conversion of debt

Options issued for services

Cashless exercise of warrants

Balance, July 31, 2024

See notes to unaudited consolidated

financial statements

Balance, August 1, 2024

$ ( 31,583,561 )

Treasury issued for services

( 1,362,637 )

Balance, October 31, 2024

$ ( 32,946,198 )

See notes to unaudited consolidated financial statements

NUTRIBAND INC.

AND SUBSIDIARIES

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CASH FLOWS (Unaudited)

For the Six Months Ended

For the Nine Months Ended

Cash flows from operating activities:

Adjustments to reconcile net loss to net cash used in operating

$ ( 7,261,573 )

$ ( 4,966,179 )

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

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Stock-based compensation-shares issued for services

Stock-based compensation-options

Stock-based compensation-options and warrants

Changes in operating assets and liabilities:

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Net Cash Used In Operating Activities

( 4,402,800 )

( 3,387,320 )

Cash flows from investing activities:

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Net change in cash

Cash and cash equivalents - Beginning of

Cash and cash equivalents - Beginning of period

Cash and cash equivalents - End of period

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Cashless conversion of warrants

Measurement of operarating lease right-of-use

assets and liabilities

Debt settlement issued by the issuance of common

stock and warrants

Measurement of operarating lease right-of-use assets and liabilities

Debt settlement issued by the issuance of common stock and warrants

Preferred Shares issued as Common stock dividend

See notes to unaudited consolidated

financial statements

Options exercised in exchange for debt

See notes to unaudited consolidated financial statements

NUTRIBAND INC.

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Notes to Unaudited Consolidated Financial Statements

as of and for the Three and Six Months Ended July

as of and for the Nine Months Ended October 31,

2025 and 2024

ORGANIZATION AND DESCRIPTION OF BUSINESS

ORGANIZATION AND DESCRIPTION

Nutriband Inc.

(the “Company”) is a Nevada corporation, incorporated on January 4, 2016.

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References to the Company relate to the Company and its subsidiaries unless the context indicates otherwise.

1, 2018, the Company acquired 4P Therapeutics LLC (“4P Therapeutics”) for $ 2,250,000 ,

consisting of 250,000

shares of common stock, valued at $ 1,850,000 ,

and $ 400,000 ,

and a royalty of 6 %

on all revenue generated by the Company from the abuse deterrent intellectual property that had been developed by 4P Therapeutics payable

to the former owner of 4P Therapeutics.

The former owner of 4P Therapeutics was a director of the Company from April 2018, when the Company

entered into an agreement to acquire 4P Therapeutics until he resigned as a director in January 2022.

2018, the Company acquired 4P Therapeutics LLC (“4P Therapeutics”) for $ 2,250,000 , consisting of 250,000 shares of common

stock, valued at $ 1,850,000 , and $ 400,000 , and a royalty of 6 % on all revenue generated by the Company from the abuse deterrent intellectual

property that had been developed by 4P Therapeutics payable to the former owner of 4P Therapeutics.

The former owner of 4P Therapeutics

was a director of the Company from April 2018, when the Company entered into an agreement to acquire 4P Therapeutics until he resigned

as a director in January 2022.

4P Therapeutics

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receive FDA approval before we can market any of our pharmaceutical products.

On August 25,

2020, the Company formed Pocono Pharmaceuticals Inc.

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The net assets were contributed to Pocono Pharmaceuticals.

the transaction, Pocono Pharmaceuticals also acquired 100 %

of the membership interests of Active Intelligence LLC (“Active Intelligence”).

Included in the

transaction, Pocono Pharmaceuticals also acquired 100 % of the membership interests of Active Intelligence LLC (“Active Intelligence”).

Pocono Pharmaceuticals

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Financial Statements

The consolidated

balance sheet as of July 31, 2025, and the consolidated statements of operations, stockholders’ equity, and cash flows for the

periods presented have been prepared by the Company and are unaudited.

In the opinion of management, all adjustments (consisting solely

of normal recurring adjustments) to prepare fairly the financial position, results of operations, changes in stockholders’ equity

and cash flows for all periods presented have been made.

The results for the six months ending July 31, 2025, are not necessarily indicative

of the results to be expected for the full year.

The consolidated financial statements should be read in conjunction with the consolidated

financial statements and footnotes therein included in the Company’s Annual Report on Form 10-K for the year ended January 31,

Unaudited Financial Statements

The consolidated balance sheet as of October

31, 2025, and the consolidated statements of operations, stockholders’ equity, and cash flows for the periods presented have

been prepared by the Company and are unaudited.

In the opinion of management, all adjustments (consisting solely of normal recurring

adjustments) to prepare fairly the financial position, results of operations, changes in stockholders’ equity and cash flows

for all periods presented have been made.

The results for the nine months ending October 31, 2025, are not necessarily indicative of

the results to be expected for the full year.

The consolidated financial statements should be read in conjunction with the

consolidated financial statements and footnotes therein included in the Company’s Annual Report on Form 10-K for the year

ended January 31, 2025.

Certain information

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significant accounting policies are in Note 2 in the Company’s Annual Report on Form 10-K for the year ended January 31, 2025.

There were no significant changes to these accounting policies during the six months ended July 31, 2025.

were no significant changes to these accounting policies during the nine months ended October 31, 2025.

Concern Assessment

assesses liquidity and going concern uncertainty in the Company’s condensed financial statements to determine whether there is

sufficient cash on hand and working capital, including available borrowings on loans, to operate for a period of at least one year from

the date the consolidated financial statements are issued or available to be issued, which is referred to as the “look-forward

period”, as defined in GAAP.

As part of this assessment, based on conditions that are known and reasonably knowable to management,

management will consider various scenarios, forecasts, projections, estimates and will make certain key assumptions, including timing

and nature of projected cash expenditures or programs, its ability to delay or curtail expenditures or programs and its ability to raise

additional capital, if necessary, among other factors.

Based on this assessment, as necessary or applicable, management makes certain

assumptions around implementing curtailments or delays in the nature and timing of programs and expenditures to the extent it deems probable

those implementations can be achieved, and management has the proper authority to execute them within the look-forward period.

31, 2025, the Company had cash and cash equivalents of $ 6,995,101

and working capital of $ 5,948,628 .

For the six months ended July 31, 2025, the Company incurred a net loss from operations of $ 3,416,710

and used cash flow from operations of $ 2,650,313 .

The Company has generated operating losses since its inception and has relied on sales of securities and the issuance of third-party and

related-party debt to support cash flow from operations.

The Company has used these proceeds to fund operations and will continue to use

the funds as needed.

In March 2023, the Company entered into a three-year $ 2,000,000

Credit Line Note facility with a related party, amended on July 13, 2023, to $ 5,000,000 ,

which will permit the Company to draw down on the credit line to fund the Company’s research and development of its Aversa product.

On April 19, 2024, the Company received proceeds of $ 8,400,000

from equity financing with European investors.

During the six months ended July 31, 2025, the Company received proceeds of $ 5,305,503

from the exercise of warrants.

assesses liquidity and going concern uncertainty in the Company’s condensed financial statements to determine whether there is sufficient

cash on hand and working capital, including available borrowings on loans, to operate for a period of at least one year from the date

the consolidated financial statements are issued or available to be issued, which is referred to as the “look-forward period”,

as defined in GAAP.

As part of this assessment, based on conditions that are known and reasonably knowable to management, management will

consider various scenarios, forecasts, projections, estimates and will make certain key assumptions, including timing and nature of projected

cash expenditures or programs, its ability to delay or curtail expenditures or programs and its ability to raise additional capital, if

necessary, among other factors.

Based on this assessment, as necessary or applicable, management makes certain assumptions around implementing

curtailments or delays in the nature and timing of programs and expenditures to the extent it deems probable those implementations can

be achieved, and management has the proper authority to execute them within the look-forward period.

As of October

31, 2025, the Company had cash and cash equivalents of $ 5,312,177 and working capital of $ 5,042,529 .

For the nine months ended October

31, 2025, the Company incurred a net loss from operations of $ 7,297,046 and used cash flow from operations of $ 4,402,800 .

has generated operating losses since its inception and has relied on sales of securities and the issuance of third-party and related-party

debt to support cash flow from operations.

The Company has used these proceeds to fund operations and will continue to use the funds as

In March 2023, the Company entered into a three-year $ 2,000,000 Credit Line Note facility with a related party, amended on July

13, 2023, to $ 5,000,000 , which will permit the Company to draw down on the credit line to fund the Company’s research and development

of its Aversa product.

On April 19, 2024, the Company received proceeds of $ 8,400,000 from equity financing with European investors.

the nine months ended October 31, 2025, the Company received proceeds of $ 5,305,503 from the exercise of warrants.

has prepared estimates for operations for the next twelve months and believes that sufficient funds will be generated from operations

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The operations of 4P Therapeutics are included in the Company’s financial statements from the date of acquisition

of August 1, 2018, and the acquired operations of Pocono Coated Products and Active Intelligence are included in the Company’s

financial statements from the date of acquisition of September 1, 2020, under Pocono Pharmaceuticals Inc.

The wholly owned subsidiaries

are as follows:

of August 1, 2018, and the acquired operations of Pocono Coated Products and Active Intelligence are included in the Company’s financial

statements from the date of acquisition of September 1, 2020, under Pocono Pharmaceuticals Inc.

The wholly owned subsidiaries are as follows:

Therapeutics LLC

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the FASB issued ASU No.

2014-09, “Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which amends

the accounting standards for revenue recognition.

ASU 2014-09 is based on principles that govern the recognition of revenue at an amount

an entity expects to be entitled when products are transferred to a customer.

The Company recognizes revenue based on the five criteria

for revenue recognition established under Topic 606:

2014-09, “Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which amends the

accounting standards for revenue recognition.

ASU 2014-09 is based on principles that govern the recognition of revenue at an amount an

entity expects to be entitled when products are transferred to a customer.

The Company recognizes revenue based on the five criteria for

revenue recognition established under Topic 606:

1) identify the contract, 2) identify separate performance obligations, 3) determine

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is a description of the Company’s revenue types, which include professional services and sale of goods:

Contract development and manufacturing services for

consumer health transdermal, topical and tape products with revenues listed under sale of goods.

Product revenues derived from the sale of the Company’s

consumer transdermal, topical and tape products with sales listed under sale of goods.

Contract research and development services for pharmaceutical

and medical device life sciences customers with revenues listed under services.

with Customers

● Contract development and manufacturing services for consumer health transdermal, topical and tape products

with revenues listed under sale of goods.

● Product revenues derived from the sale of the Company’s consumer transdermal, topical and tape products

with sales listed under sale of goods.

● Contract research and development services for pharmaceutical and medical device life sciences customers

with revenues listed under services.

Contracts with Customers

A contract with a customer exists when

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intent and ability to pay the promised consideration.

Contract Liabilities

Deferred revenue is a liability related

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from a contract before achieving certain criteria that must be met for revenue to be recognized in conformity with GAAP.

Performance Obligations

A performance obligation is a promise

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recognized in the income statement is considered to be revenue from contracts with customers.

Disaggregation

Disaggregation of Revenues

disaggregates its revenue from contracts with customers by type and by geographical location.

See the tables:

Six Months Ended

Nine Months Ended

Three Months Ended

1 unchanged sentence

Sale of goods

Six Months Ended

Nine Months Ended

Three Months Ended

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and cash equivalents.

Cash and cash

equivalents include cash on hand and cash on deposit in money market accounts.

The Company considers short-term highly liquid investments

with an original maturity date of three months or less that are not part of an investment pool to be cash equivalents.

As of July 31,

2025, the Company had approximately $ 6,607,000

that exceeded federally insured cash balance limits.

Cash and cash equivalents include

cash on hand and cash on deposit in money market accounts.

The Company considers short-term highly liquid investments with an original

maturity date of three months or less that are not part of an investment pool to be cash equivalents.

As of October 31, 2025, the Company

had approximately $ 4,900,000 that exceeded federally insured cash balance limits.

Trade accounts

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specific identification of customer accounts where appropriate and the application of historical loss to non-applicable accounts.

the six months ended July 31, 2025, and 2024, the Company recorded bad debt expenses of $ -0-

and $ 1,200 ,

respectively, for doubtful accounts related to accounts receivable.

During the year ended January 31, 2024, the Company entered into an

accounts receivable sale agreement for one of its subsidiaries.

The Company received $ 106,528

in funds against an account receivable that is currently a claim in bankruptcy.

The net accounts receivable remains on the books of the

Company, and a corresponding amount has been included as a secured borrowing liability under Notes payable.

As of July 31, 2025, the receivable

has been reserved in full.

If the bankruptcy claim is not paid in full by the debtor, Company is obligated to pay any difference to the

the six months ended July 31, 2025, and 2024, the Company recorded bad debt expenses of $ -0- and $ 1,200 , respectively, for doubtful accounts

related to accounts receivable.

During the year ended January 31, 2024, the Company entered into an accounts receivable sale agreement

for one of its subsidiaries.

The Company received $ 106,528 in funds against an account receivable that is currently a claim in bankruptcy.

The net accounts receivable remains on the books of the Company, and a corresponding amount has been included as a secured borrowing liability

under Notes payable.

As of October 31, 2025, the receivable has been reserved in full.

If the bankruptcy claim is not paid in full by

the debtor, Company is obligated to pay any difference to the factor.

The loan bears interest at 10 %.

The Company adopted ASU 2016-13 during 2013 and implemented the guidance on expected credit losses.

The Company adopted ASU 2016-13

during 2013 and implemented the guidance on expected credit losses.

are valued at the lower of cost and reasonable value determined using the first-in, first-out (FIFO) method.

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operating capacity).

As of July 31, 2025, total inventory was $ 138,031 ,

consisting of work-in-process of $ 8,061 ,

finished goods of $ 8,042

and raw materials of $ 121,477 .

As of January 31, 2025, total inventory was $ 212,041 ,

consisting of work-in-process of $ 46,255 ,

finished goods of $ 16,609

As of October 31, 2025, total inventory was $ 135,998 , consisting of work-in-process of $ 8,061 , finished goods of

$ 8,042 and raw materials of $ 121,477 .

As of January 31, 2025, total inventory was $ 212,041 , consisting of work-in-process of $ 46,255 ,

finished goods of $ 16,609 and raw materials of $ 149,177 .

Plant and Equipment

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Depreciation is computed using the straight-line method.

lives over which the fixed assets are depreciated range from 3

The lives over which the fixed

assets are depreciated range from 3 to 20 years as follows:

Lab Equipment

Furniture and fixtures

Machinery and equipment

and equipment

assets include trademarks, intellectual property and customer base acquired through business combinations.

The Company accounts for Other

Intangible Assets under the guidance of ASC 350, “Intangibles-Goodwill and Other.” The Company capitalizes certain costs

related to patent technology.

A substantial component of the purchase price related to the Company’s acquisitions has also been

assigned to intellectual property and other intangibles.

Under the guidance, other intangible assets with definite lives are amortized

over their estimated useful lives.

Intangible Assets under the guidance of ASC 350, “Intangibles-Goodwill and Other.” The Company capitalizes certain costs related

to patent technology.

A substantial component of the purchase price related to the Company’s acquisitions has also been assigned

to intellectual property and other intangibles.

Under the guidance, other intangible assets with definite lives are amortized over their

estimated useful lives.

Intangible assets with indefinite lives are tested annually for impairment.

Trademarks, intellectual

property and customer base are being amortized over their estimated useful lives of ten

During the year ended January 31, 2025, the Company recorded an impairment charge of $ 293,038

to its intellectual property.

Trademarks, intellectual property

and customer base are being amortized over their estimated useful lives of ten years .

During the year ended January 31, 2025, the Company

recorded an impairment charge of $ 293,038 to its intellectual property.

Goodwill represents

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During the years ended January 31, 2025 and 2024, the Company recorded an impairment charge of

respectively, reducing the Active Intelligence LLC Goodwill to $-0- .

As of July 31, 2025 and January 31, 2025, Goodwill amounted to $ 1,719,535

and $ 1,719,535 ,

respectively.

$ 3,302,478 and $-0-, respectively, reducing the Active Intelligence LLC Goodwill to $ -0- .

As of October 31, 2025 and January 31, 2025,

Goodwill amounted to $ 1,719,535 and $ 1,719,535 , respectively.

reviews long-lived assets for potential impairment whenever significant events or changes in circumstances indicate that the carrying

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upon the exercise of outstanding options and common stock purchase warrants.

As of July 31, 2025, and 2024, there were 8,927,218

and 6,872,833

common stock equivalents outstanding, that were not included in the calculation of dilutive earnings per share as their effect would be

anti-dilutive.

As of October 31, 2025, and 2024, there were 9,364,694 and

6,922,833 common stock equivalents outstanding, that were not included in the calculation of dilutive earnings per share as their effect

would be anti-dilutive.

ASC 718, “Compensation

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development costs are expensed as incurred.

calculated in accordance with taxation principles currently effective in the United States and Ireland.

Taxes are calculated

in accordance with taxation principles currently effective in the United States and Ireland.

accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities

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- Observable inputs such as quoted market prices in active markets.

- Inputs other than quoted prices in active markets that are

either directly or indirectly observable.

- Unobservable inputs about which little or no market data exists,

therefore requiring an entity to develop its own assumptions.

- Inputs other than quoted prices in active markets that are either directly or indirectly

- Unobservable inputs about which little or no market data exists, therefore requiring an entity

to develop its own assumptions.

value of the Company’s financial instruments, including accounts receivable, prepaid expenses, accounts payable and accrued expenses,

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that any new or modified principles will have a material impact on the Company’s reported financial position or operations in the

The applicability of any standard is subject to the formal review of the Company’s financial management and certain

standards are under consideration.

The applicability of any standard is subject to the formal review of the Company’s financial management and certain standards

are under consideration.

PROPERTY AND EQUIPMENT

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Net Property and Equipment

expenses amounted to $ 84,530

for the six months ended July 31, 2025, and 2024, respectively.

During the six months ended July 31, 2025, and 2024, depreciation expenses

and $ 61,163 ,

respectively, have been allocated to the cost of goods sold.

Depreciation expenses amounted to $ 112,419 and $ 127,337 for

the nine months ended October 31, 2025, and 2024, respectively.

During the nine months ended October 31, 2025, and 2024, depreciation

expenses of $ 89,935 and $ 94,644 , respectively, have been allocated to the cost of goods sold.

NOTES PAYABLE

Notes Payable

Active Intelligence,

entered into an agreement with the Carolina Small Business Development Fund for a line of credit of $ 160,000

16, 2028 , with interest of 5 %

entered into an agreement with the Carolina Small Business Development Fund for a line of credit of $ 160,000 due October 16, 2028 , with

interest of 5 % per year.

The amount assumed was $ 139,184 .

The loan requires monthly payments of principal and interest of $ 1,697 .

During the six months ended July 31, 2025, the Company made $ 8,384

of principal payments.

the nine months ended October 31, 2025, the Company made $ 12,642 of principal payments.

As of July 31, 2025, the amount due was $ 56,490 ,

of which $ 17,109

of which $ 17,324 is current.

As of January 31, 2025, the amount due was $ 69,132 .

2022, the Company entered into a retail installment agreement for the purchase of an automobile.

The contract price was $ 32,274 ,

of which $ 22,795

The contract price was $ 32,274 , of which

$ 22,795 was financed.

The agreement is for five years bearing interest at 2.95 %

per annum with payments of $ 410

The loan is secured by automobile.

As of July 31, 2025, the amount due was $ 8,383 ,

of which $ 4,732

As of January 31, 2025, the amount due was $ 10,689 .

payable-related party.

2023, the Company entered an amended Credit Line Note agreement, for an increased $ 5,000,000

credit line facility to the Company entered on March 17, 2023.

Outstanding advances under the Note bears interest at 7 %

The promissory note is due and payable in full on March 19, 2026.

Interest is payable annually on December 31 of each year

during the term of the note.

The Company received advances of $ 300,000

during the nine months ended October 31, 2024.

On May 15, 2024, the Company agreed to convert the $ 300,000

The conversion was made pursuant to the terms of a Conversion Agreement, which provided the conversion of $ 300,000

of principal and $ 4,922

of accrued interest.

The Company issued 76,230

shares of common stock and 152,460

warrants exercisable at $ 6.43

per share, resulting in a $ 368,036

The agreement is for five years bearing interest at 2.95 % per annum with payments of $ 410 per month.

secured by automobile.

As of October 31, 2025, the amount due was $ 7,204 , of which $ 4,767 is current.

As of January 31, 2025, the amount

due was $ 10,689 .

Note payable-related

2023, the Company entered an amended Credit Line Note agreement, for an increased $ 5,000,000 credit line facility to the Company entered

on March 17, 2023.

Outstanding advances under the Note bears interest at 7 % per annum.

The promissory note is due and payable in full

on March 19, 2026.

Interest is payable annually on December 31 of each year during the term of the note.

The Company received advances

of $ 300,000 during the nine months ended October 31, 2024.

On May 15, 2024, the Company agreed to convert the $ 300,000 debt.

The conversion

was made pursuant to the terms of a Conversion Agreement, which provided the conversion of $ 300,000 of principal and $ 4,922 of accrued

The Company issued 76,230 shares of common stock and 152,460 warrants exercisable at $ 6.43 per share, resulting in a $ 368,036

loss on extinguishment.

As of July 31, 2025 and January 31, 2025, the balance due was $ -0- ,

respectively.

The Company recorded interest expense of $ -0-

for the six months ended July 31, 2025, and 2024, respectively.

As of October 31, 2025 and January 31, 2025, the balance due was $ -0- , respectively.

The Company recorded interest

expense of $ -0- and $ 4,163 for the nine months ended October 31, 2025, and 2024, respectively.

borrowing liability.

2023, the Company entered into an accounts receivable sale agreement for one of its subsidiaries in connection with a bankruptcy claim.

The Company received $ 106,528

and recorded the transaction as a secured loan payable against the account receivable.

The sale of the account receivable balance was

to an outside third party, whereby if the bankruptcy court does not pay the balance in full, the Company will owe back the unpaid portion.

The loan is classified as a current liability as the Company expects the bankruptcy will be resolved in the next twelve months.

bears interest at 10 %.

For the three months ended July 31, 2025, and 2024, the Company recorded an interest expense of $ 5,184

and $ 5,212 ,

respectively.

The Company received $ 106,528 and recorded the transaction as a secured loan payable against the account receivable.

The sale of the account

receivable balance was to an outside third party, whereby if the bankruptcy court does not pay the balance in full, the Company will owe

back the unpaid portion.

The loan is classified as a current liability as the Company expects the bankruptcy will be resolved in the next

twelve months.

The loan bears interest at 10 %.

For the nine months ended October 31, 2025, and 2024, the Company recorded an interest

expense of $ 7,819 and $ 7,847 , respectively.

Interest expenses

for the six months ended July 31, 2025, and 2024, were $ 11,653

and $ 12,401 ,

respectively.

for the nine months ended October 31, 2025, and 2024, were $ 17,201 and $ 17,668 , respectively.

INTANGIBLE ASSETS

31, 2025, and January 31, 2025, intangible assets consisted of intellectual property and trademarks, customer base, and license agreement,

net of amortization, as follows:

As of October 31, 2025, and January

31, 2025, intangible assets consisted of intellectual property and trademarks, customer base, and license agreement, net of amortization,

Customer base

2 unchanged sentences

Net Intangible Assets

expenses for the six months ended July 31, 2025, and 2024 amounted to $ 30,332

and $ 56,575 ,

respectively.

During the year ended January 31, 2025, the Company recorded an impairment charge of $ 293,038

to its Intellectual property.

expenses for the nine months ended October 31, 2025, and 2024 amounted to $ 45,499 and $ 84,863 , respectively.

During the year ended January

31, 2025, the Company recorded an impairment charge of $ 293,038 to its Intellectual property.

Year Ended January 31,

1 unchanged sentence

RELATED PARTY TRANSACTIONS

Activity during

the six months ended July 31, 2025

During the six months ended July 31, 2025, a director of the Company and a related party exercised warrants

and were issued 311, 041 and 160,000

shares of common stock, respectively.

Activity during

the six months ended July 31, 2024

In March 2024, options to purchase 390,000

shares of common stock to executives and employees of the Company at a price of $ 2.37

The options vest immediately and expire in three

The fair value of the options issued amounted to $ 422,955

and was expensed during the six months ended July 31, 2024.

On April 19, 2024, the Company completed an $ 8,400,000

equity financing with European investors which included related parties.

The related parties invested a total of $ 7,120,000

and received 1,780,000

shares of common stock and warrants to purchase 3,560,000

shares of common stock @ $ 6.43

related party, a director of the Company, invested $ 4.5

million which included $ 500,000

from his son and $ 700,000

from an entity he controls.

The other related party invested $ 2.62

million from entities controlled by the investor.

Activity during the nine months ended October 31, 2025

a) During the nine months ended October 31, 2025, a director of the Company and a related party exercised

warrants and were issued 311, 041 and 160,000 shares of common stock, respectively.

b) In August 2025, 409,167 options to purchase common shares of the Company were issued to executive officers

and employees exercisable at prices of $ 6.22 - $ 6.85 per share.

The options vest immediately and expire three years from the date of issuance.

The fair value of the options issued for services amounted to $ 1,285,137 .

c) In October 2025, the Company’s President and CFO exercised employee stock options, and the Company

issued 140,000 shares of common stock.

Activity during the nine

months ended October 31, 2024

a) During the nine months ended October 31, 2024, options to purchase 450,000 shares of common stock to executives

and employees of the Company at a price of $ 2.37 and $ 5.99 per share.

The options vest immediately and expire in three years .

value of the options issued amounted to $ 553,335 and was expensed during the nine months ended October 31, 2024.

b) On April 19, 2024, the Company completed an $ 8,400,000 equity financing with European investors which

included related parties.

The related parties invested a total of $ 7,120,000 and received 1,780,000 shares of common stock and warrants

to purchase 3,560,000 shares of common stock at $ 6.43 per share.

One related party, a director of the Company, invested $ 4.5 million which

included $ 500,000 from his son and $ 700,000 from an entity he controls.

The other related party invested $ 2.62 million from entities controlled

by the investor.

See Note 7 for further information.

During the six months ended July 31, 2024, the Company received $ 300,000

from the credit line facility with TII Jet Services LDA.

On May 14, 2024, the Company converted the debt and accrued interest into 76,240

shares of common stock and issued 152,460

warrants to the lender.

c) During the nine months ended October 31, 2024, the Company received $ 300,000 from the credit line facility

with TII Jet Services LDA.

On May 14, 2024, the Company converted the debt and accrued interest into 76,240 shares of common stock and

issued 152,460 warrants to the lender.

See Note 4 for further information.

On June 5, 2024, the Company’s Chief Financial Officer exercised 87,500

warrants as a cashless conversion and was issued 60,085

shares of common stock.

d) On June 5, 2024, the Company’s Chief Financial Officer exercised 87,500 warrants as a cashless conversion

and was issued 60,085 shares of common stock.

STOCKHOLDERS’ EQUITY

A Convertible Preferred Stock

15, 2016, the board of directors of the Company approved a certificate of amendment to the articles of incorporation and changed the authorized

capital stock of the Company to include and authorize 10,000,000

shares of Series A Preferred Stock, par value $ 0.001

2025, the board of directors created a series of non-voting preferred stock consisting initially of shares designated as the Series A

Convertible Preferred Stock (the “the Series A Preferred Stock”).

‘The Company authorized on July

9, 2025, a preferred stock dividend to be issued by the Company to all shareholders on the basis of one

share of Series A Preferred stock issued for each four

shares of common stock owned by the holder.

Preferred Stock

On January 15, 2016, the board of directors of the Company

approved a certificate of amendment to the articles of incorporation and changed the authorized capital stock of the Company to include

and authorize 10,000,000 shares of Preferred Stock, par value $ 0.001 per share.

On July 9,2025, the board of directors created a series of

non-voting preferred stock consisting initially of shares designated as the Series A Convertible Preferred Stock (the “the Series

A Preferred Stock”).

The terms of the Series A Preferred Stock provide that, following the date of the approval for commercial sale

by the Federal Drug Administration of the Company’s transdermal pharmaceutical products that are based on the Company’s AVERSA

abuse deterrent technology, each share of Series A Preferred Stock will be convertible at the option of the holder into one share of Common

The holders of Series A Preferred Stock that do not convert their shares shall be eligible for dividends as declared by the board

of directors for those holders of the Series A Preferred Stock, and the Series A Preferred Stock is also eligible for dividends declared

by the board of directors on the class of common stock.

The Company authorized on July 9, 2025, a preferred stock

dividend to be issued by the Company to all shareholders on the basis of one share of Series A Preferred stock issued for each four shares

of common stock owned by the holder.

The record date for the dividend was July 25, 2025.

On the August 5, 2025 date of distribution

of the dividend, 3,008,642

On the date of distribution of the dividend,

3,008,643 shares of the Series A Preferred Stock were issued to our shareholders.

The fair value of the shares preferred stock issued in the dividend

was $ 21,814,166 .

The fair value was determined by a management estimate of the likelihood of FDA approval, which was determined to be 85 %.

The Company valued the dividend at 85 %

of the common stock market price.

Rights and Preferences of the Series A Preferred Stock

The Certificate of Rights and Preferences for the Series A Preferred Stock provides that, following the date of the approval for commercial

sale by the Federal Drug Administration of the Company’s transdermal pharmaceutical products that are based on the Company’s

AVERSA abuse deterrent technology, each share of Series A Preferred Stock will be convertible at the option of the holder into one

share of Common Stock.

The holders of Series A Preferred Stock that do not convert their shares shall be eligible for dividends as declared

by the board of directors for those holders of the Series A Preferred Stock, and the Series A Preferred Stock is also eligible for dividends

declared by the board of directors on the class of common stock.

Dividends, Junior Securities .

So long as any shares of Series A Preferred Stock outstanding, neither the Company nor any subsidiary

thereof shall, without the consent of the Holders of ninety percent ( 90 %)

of the shares of Series A Preferred Stock then outstanding, (a) redeem, repurchase or otherwise acquire directly or indirectly any Junior

Securities (as defined in Section 9), (b) directly or indirectly pay or declare any dividend or make any distribution upon, nor shall

any distribution be made in respect of, any Junior Securities, or (c) set aside any monies to the purchase or redemption (through a sinking

fund or otherwise) of any Junior Securities.

The sale, conveyance or transfer (for cash, shares of stock, securities or other consideration) of all or substantially all of

the property and assets of the Company is deemed a voluntary liquidation, dissolution or winding up of the Company for purposes of this

The merger or consolidation of the Company into or with any other corporation, or the merger or consolidation of any other

corporation into or with the Company, is not be deemed to be an event of liquidation, dissolution or winding up, if the holders of the

Series A Preferred Stock outstanding upon the effectiveness of such merger or combination, receive for each share of Series A Preferred

share of preference stock of the resulting or surviving corporation, which share of preferred stock will have rights and privileges roughly

equivalent to the rights and privileges of the Series A Preferred Stock.

Holders of Series A Preferred Stock shall be entitled to receive dividends, when and as declared by the Board of Directors out of funds

legally available therefor.

For any other dividends or distributions, the Series A Preferred Stock will participate with the Company’s

common stock on an as-converted basis.

at Option of Holder .

Following the date of the approval by the Federal Drug Administration of the Company’s transdermal

pharmaceutical products that are based on the Company’s AVERSA ™ abuse deterrent transdermal technology for commercial

sale, each share of Series A Preferred Stock is convertible at the option of the holder into one

share of Common Stock.

Splits, etc .

If, at any time while any shares of Series A Preferred Stock remain outstanding (“Outstanding Shares”),

the Company effectuates a stock split or reverse stock split of its Common Stock or issues a dividend on its Common Stock consisting of

shares of Common Stock, the Conversion Price and any other amounts calculated as contemplated by this Certificate of Designations shall

be equitably adjusted to reflect such action with respect to Outstanding Shares at the record date of such split.

during the Six Months Ended July 31, 2025

As of July 31, 2025, the Company holds 18,900

shares of treasury stock.

The fair value of the preferred stock dividend was $ 21,814,622 .

On July 26, 2022, the Board of Directors of the Company approved

a 7-for-6 forward stock split , effective for trading purposes as of August 12, 2022, pursuant to which each shareholder as of the August

15, 2022 record date received one (1) additional share for each six (6) shares held as of the record date.

Pursuant to the operation of

the amendment providing for the forward stock split filed with the Secretary of State of Nevada on August 4, 2022, the authorized common

stock of the Company was increased from 250,000,000 shares to 291,666,666 shares in connection with the forward split.

Activity during the Nine Months Ended

October 31, 2025

(a) As of October 31, 2025, the Company holds 18,900 shares of treasury stock.

During the nine months ended October 31, 2025, 13,500 shares

of treasury stock held by the Company were issued to employees for services rendered.

The Company recorded an expense of $ 104,460 during

the nine months ended October 31, 2025, in connection with the transaction.

(b) On February 8, 2025, the Company entered into an agreement with a consultant to provide consulting services to the Company’s

Board of Directors.

The Company issued 5,000 shares of the Company’s common stock to the consultant, valued at $ 39,050 and expensed

during the six months ended July 31, 2025.

shares of treasury stock held by the Company were issued to employees for services rendered.

The Company recorded an expense of $ 65,410

during the six months ended July 31, 2025, in connection with the transaction.

On February 8, 2025, the Company entered into an agreement with a consultant to provide consulting services

to the Company’s Board of Directors.

The Company issued 5,000

shares of the Company’s common stock to the consultant, valued at $ 39,050

and expensed during the six months ended July 31, 2025.

The shares were issued from the treasury shares held by the Company.

of the agreement is for twelve months .

In February 2025, the Company’s outside counsel exercised 58,433

warrants as a cashless conversion and the Company issued 46,961

shares of common stock.

In July 2025, third parties exercised 98,560

warrants as a cashless conversion, and the Company issued 35,540

The term of the agreement

is for twelve months .

(c) In February 2025, the Company’s outside counsel exercised 58,433 warrants as a cashless conversion and the Company issued 46,961

shares of common stock.

In July 2025, two employees exercised employee stock options.

(d) In July 2025, third parties exercised 98,560 warrants as a cashless conversion, and the Company issued 35,540 shares of common stock.

(e) In July 2025, two employees exercised employee stock options.

The Company received proceeds of $ 44,206 and issued 20,055 shares of

common stock.

(f) In July 2025, the Company received proceeds of $ 303,477 from the exercise of public warrants and the Company issued 47,076 shares

of common stock.

(g) In July 2025, the Company received proceeds of $ 5,002,026 from the exercise of warrants and the Company issued 778,041 shares of common

(h) In October 2025, the Company’s CFO exercised employee exercised employee stock options.

The Company received proceeds of $ 75,000

and issued 20,055

shares of common stock.

In July 2025, the Company received proceeds of $ 303,477

from the exercise of public warrants and the Company issued 47,076

shares of common stock.

In July 2025, the Company received proceeds of $ 5,002,026

from the exercise of warrants and the Company issued 778,041

shares of common stock.

during the Six Months Ended July 31, 2024

As of April 30, 2024, the Company held 10,000

of its shares comprising $ 32,641

of treasury stock.

There was no activity during the three months ended April 30, 2024.

On April 19, 2024, the Company completed an $ 8,400,000

equity financing with European investors (the “Offering”) of 2,100,000

units (“Units”), at a price of $ 4.00

per Unit, consisting of one

share of common stock (“Shares”) and a Warrant to purchase two

Shares of common stock, the Warrant having an exercise price of $ 6.43 ,

are exercisable by payment of the exercise price in cash only and expire April 19, 2029, five

years from the date of issuance (“Warrants”).

The offering was made solely to investors residing outside

the United States and was not registered under the Security Act of 1933, as amended, (the “Security Act”), or the security

law of any jurisdiction, including outside the United States, but was made privately by the Company pursuant to the exemptions from registration

provided in the SEC’s Regulation S and other exemptions under the Securities Act.

and issued 20,000 shares of common stock.

(i) In October 2025, the Company’s President exercised employee stock options in exchange for a settlement of debt.

issued 120,000 shares of common stock in exchange for $ 317,110 of debt.

Activity during the Nine Months Ended

October 31, 2024

(a) As of October 31, 2024, the Company held zero of treasury stock.

On September 10,2024, 10,000 shares of treasury stock held by the

Company were issued to an investor relations firm for services rendered.

The Company recorded an expense of $ 38,700 during the nine months

ended October 31, 2024, in connection with the transaction.

(b) On April 19, 2024, the Company completed an $ 8,400,000 equity financing with European investors (the “Offering”) of 2,100,000

units (“Units”), at a price of $ 4.00 per Unit, consisting of one share of common stock (“Shares”) and a Warrant

to purchase two Shares of common stock, the Warrant having an exercise price of $ 6.43 , are exercisable by payment of the exercise price

in cash only and expire April 19, 2029, five years from the date of issuance (“Warrants”).

The offering was made solely to

investors residing outside the United States and was not registered under the Security Act of 1933, as amended, (the “Security Act”),

or the security law of any jurisdiction, including outside the United States, but was made privately by the Company pursuant to the exemptions

from registration provided in the SEC’s Regulation S and other exemptions under the Securities Act.

(c) On May 15, 2024, the Company agreed to convert $ 300,000 of debt and $ 4,922 of accrued interest under the Credit Line Note agreement.

The conversion was made pursuant to the terms of a Conversion Agreement, which provided the conversion of the debt and accrued interest.

The Company issued 76,230 shares of common stock and 152,460 warrants exercisable at $ 6.43 per share resulting in a loss on settlement

of $ 368,036 .

(d) On June 5, 2024, the Company’s Chief Financial exercised 87,500 warrants as a cashless conversion and was issued 60,085 shares

of common stock.

OPTIONS and WARRANTS

On April 19, 2024, in connection with

a private placement of the Company’s common stock, the Company issued 4,200,000

The warrants are exercisable at a price of $ 6.43

per share and expire five

years from the date of issuance.

a private placement of the Company’s common stock, the Company issued 4,200,000 warrants.

The warrants are exercisable at a price

of $ 6.43 per share and expire five years from the date of issuance.

On May 15, 2024, the Company issued

warrants in connection with extinguishment of debt of $ 300,000

and accrued interest.

152,460 warrants in connection with extinguishment of debt of $ 300,000 and accrued interest.

The warrants are exercisable at a price of

per share and expire five

years from the date of issuance.

Non-cash expense of $ 390,145

is included in loss on extinguishment of debt.

$ 6.43 per share and expire five years from the date of issuance.

Non-cash expense of $ 390,145 is included in loss on extinguishment of

On June 5, 2024, the Company’s

Chief Financial Officer exercised 87,500

warrants as a cashless conversion and the Company issued 60,085

shares of common stock.

On September 10, 2024, the Company

issued 50,000

Chief Financial Officer exercised 87,500 warrants as a cashless conversion and the Company issued 60,085 shares of common stock.

On September 10, 2024, the Company issued

50,000 warrants to an investor relations firm.

The warrants are exercisable at a price of $ 4.00

per share and expire three

years from the date of issuance.

The Company recorded a non-cash expense of $ 94,650

during the year ending January 31, 2025.

The agreement is for twelve months and includes the issuance of 10,000

treasury shares and monthly payments of $ 12,500 .

The warrants and shares vest immediately and because they are non-forfeitable, the expense was recognized immediately.

The Company cancelled

the warrants as of January 31, 2025.

Non-cash compensation for the year

ended January 31, 2025, amounted to $ 484,975 .

The Company used the Black Scholes

valuation model to record fair value of the value of the warrants issued during the year ending January 31, 2025.

The valuation model

used a dividend rate of 0 %;

expected terms of 1.5 - 2.5

The warrants are exercisable at a price of $ 4.00 per share and expire three years from

the date of issuance.

The Company recorded a non-cash expense of $ 94,650 during the year ending January 31, 2025.

The agreement is for

twelve months and includes the issuance of 10,000 treasury shares and monthly payments of $ 12,500 .

The warrants and shares vest immediately

and because they are non-forfeitable, the expense was recognized immediately.

The Company cancelled the warrants as of January 31, 2025.

Non-cash compensation for the year ended

January 31, 2025, amounted to $ 484,975 .

The Company used the Black Scholes valuation

model to record fair value of the value of the warrants issued during the year ending January 31, 2025.

The valuation model used a dividend

expected terms of 1.5 - 2.5 years;

volatility rates of 105.98 %- 145.05 %;

and risk-free rates of 3.65 %- 4.45 %.

The following table summarizes the

changes in the warrants outstanding and the related price of the shares of the common stock issued to non-employees of the Company during

the six months ended July 31, 2025 and the year ended January 31, 2025.

Outstanding, January 31, 2024

In October 2025, the Company issued

340,393 warrants to investors for services rendered, including a director and a related party of the Company.

The warrants are exercisable

at a price of $ 6.00 per share and expire three years from the date of issuance.

The Company recorded a non-cash expense of $ 1,250,264

during the nine months ended October 31, 2025.

The Company used the Black Scholes valuation

model to record fair value of the warrants issued during the nine months ending October 31, 2025.

The valuation model used a dividend

expected terms of 2.5 years;

volatility rates of 105 %;

and risk-free rate of 4 %.

The following table summarizes the changes

in the outstanding warrants and the related price of the shares of the common stock issued to non-employees of the Company during the

nine months, which ended October 31, 2025 and the year ended January 31, 2025.

Exercise Remaining Intrinsic

Shares Price Life Value

Outstanding, January 31, 2024 1,283,038 $ 5.88 2.97 years $ -

Granted 4,402,460 6.40 4.72 years -

Expired/Cancelled ( 50,000 ) 4.00 - -

Outstanding, January 31, 2025

Exercised ( 88,525 ) 1.98 - -

Outstanding, January 31, 2025 5,546,973 5.85 3.68 years -

Granted 340,393 6.00 - -

Expired/Cancelled -

Outstanding- July 31, 2025

Exercisable - July 31, 2025

Exercised ( 982,010 ) 6.16 - -

Outstanding- October 31, 2025 4,905,356 $ 6.39 3.09 years $ 1,683,376

Exercisable - October 31, 2025 4,905,356 $ 6.39 3.09 years $ 1,683,376

The following

table summarizes additional information relating to the warrants outstanding as of July 31, 2025:

Range of Exercise

Remaining Contractual

Exercise Price for Shares

table summarizes additional information relating to the warrants outstanding as of October 31, 2025:

Number Remaining

Exercise Price

Number Exercise Price

Prices Outstanding Life(Years) Outstanding Exercisable Exercisable Value

$ 4.00 30,000 2.35 $ 4.00 30,000 $ 4.00 $ 81,900

$ 6.00 340,393 4.87 $ 6.00 340,393 $ 6.00 $ 248,487

$ 6.43 4,509,963 2.94 $ 6.43 4,509,953 $ 6.43 $ 1,352,989

$ 7.50 25,000 2.02 $ 7.50 25,000 $ 7.50 $ -

4,905,356 $ 6.37 4,905,346 $ 6.42 $ 1,683,376

On November 1, 2021, the Board of Directors

adopted the 2021 Employee Stock Option Plan (the “Plan”).

The Company has reserved 408,333

shares for issuance and sale upon the exercise of stock options.

In accordance with the Plan, on February 1, 2022, the Company reserved

an additional 233,333

shares and on February 1, 2023, the Company reserved an additional 233,333

The Company has reserved 408,333 shares for issuance and sale upon

the exercise of stock options.

In accordance with the Plan, on February 1, 2022, the Company reserved an additional 233,333 shares and

on February 1, 2023, the Company reserved an additional 233,333 shares.

The options vest immediately and expire in three years.

Under the Plan, options may be granted which are intended to qualify as

Incentive Stock Options (“ISO’s”) under Section 422 of the Internal Revenue Code of 1986 (the “Code”)

or which are not (“non-ISO’s”) intended to qualify as Incentive Stock Options thereunder.

The Plan also provides

for restricted stock awards representing shares of common stock that are issued subject to such restrictions on transfer and other incidents

of ownership and such forfeiture conditions as the Board of Directors, or the committee administering the Plan composed of directors who

qualify as “independent” under Nasdaq rules, may determine.

On November 3, 2021, the Company filed a Registration Statement

on Form S-8, to register under the Securities Act of 1933, as amended the 408,333

shares of common stock reserved for issuance under the Plan.

the Plan, options may be granted which are intended to qualify as Incentive Stock Options (“ISO’s”) under Section 422

of the Internal Revenue Code of 1986 (the “Code”) or which are not (“non-ISO’s”) intended to qualify as

Incentive Stock Options thereunder.

The Plan also provides for restricted stock awards representing shares of common stock that are issued

subject to such restrictions on transfer and other incidents of ownership and such forfeiture conditions as the Board of Directors, or

the committee administering the Plan composed of directors who qualify as “independent” under Nasdaq rules, may determine.

On November 3, 2021, the Company filed a Registration Statement on Form S-8, to register under the Securities Act of 1933, as amended

the 408,333 shares of common stock reserved for issuance under the Plan.

On March 20, 2024, our Board of Directors

adopted an amendment to the Company’s Employee Stock Option Plan (the “Plan”) increasing the number of shares of

common stock subject to the Plan (as of March 20, 2024, 875,000

shares) to 1,400,000

shares (the “Amendment”).

The Company submitted the Amendment to the Plan to our stockholders for adoption and approval

at the 2025 Annual Meeting.

The Amendment was approved by the stockholders on January 23, 2025.

As of July 31, 2025, with the February

1, 2025 automatic issuance of shares available under the Plan, 276,332

adopted an amendment to the Company’s Employee Stock Option Plan (the “Plan”) increasing the number of shares of common

stock subject to the Plan (as of March 20, 2024, 875,000 shares) to 1,400,000 shares (the “Amendment”).

The Company submitted

the Amendment to the Plan to our stockholders for adoption and approval at the 2025 Annual Meeting.

The Amendment was approved by the

stockholders on January 23, 2025.

As of October 31, 2025, with February 1, 2025, automatic issuance of shares available under the Plan,

39,249 shares remain available for issuance of options under the Plan.

During the year ending January 31, 2025,

2025, 689,584

689,584 options to purchase shares of the Company’s common stock were issued to executive officers and employees at prices of $ 2.37 -

The options vest immediately and expire three

years from the date of issuance.

The fair value of the options issued for services amounted to $ 1,408,935

and were recorded during the year ending January 31, 2025.

The Company used the Black-Scholes valuation model to record the fair value.

$ 8.07 per share.

The options vest immediately and expire three years from the date of issuance.

The fair value of the options issued for

services amounted to $ 1,408,935 and were recorded during the year ending January 31, 2025.

The Company used the Black-Scholes valuation

model to record the fair value.

The valuation model used a dividend rate of 0 %;

expected term of 1.5

expected term of 1.5 years;

volatility rate of 97.83 %- 114.86 %;

and a risk-free rate of 4.00 %- 4.87 %.

The following table summarizes the

changes in outstanding options and the related price of the shares of the Company’s common stock issued to employees of the Company.

See Note 7 for the issuance of related party options.

Outstanding, January 31, 2024

During the nine months ending October

31, 2025, 409,167 options to purchase shares of the Company’s common stock were issued to executive officers and employees at prices

of $ 6.22 - $ 6.85 per share.

The options vest immediately and expire three years from the date of issuance.

The fair value of the options

issued amounted to $ 1,285,142 and were recorded during the nine months ending October 31, 2025.

The Company used the Black Scholes valuation

model to record the fair value.

The valuation model used a dividend rate of 0 %;

expected term of 1.5 years;

volatility rate of 106.55

and a risk-free rate of 3.69 %- 3.91 %.

The following table summarizes the changes

in outstanding options and the related price of the shares of the Company’s common stock issued to employees of the Company.

Note 7 for the issuance of related party options.

Exercise Remaining Intrinsic

Shares Price Life Value

Outstanding, January 31, 2024 874,835 $ 3.23 2.31 years

Granted 689,584 4.40 1.93 years -

Expired/Cancelled ( 190,751 ) -

Outstanding, January 31, 2025

Outstanding, January 31, 2025 1,373,668 3.23 1.90 years

Granted 409,167 6.44 -

Expired/Cancelled ( 172,084 ) -

Outstanding- July 31, 2025

Exercisable - July 31, 2025

Exercised ( 160,055 ) 1.46 -

Outstanding- October 31, 2025 1,450,696 $ 4.51 1.77 years $ 3,427,861

Exercisable - October 31, 2025 1,450,696 $ 4.51 1.77 years $ 3,427,861

The following table summarizes additional

information relating to the options outstanding as of July 31, 2025.:

Range of Exercise Prices

Number Outstanding

Weighted Average Life(Years)

Weighted Average Exercise Price for Shares Outstanding

Number Exercisable

Weighted Average Exercise Price for Shares Exercisable

Intrinsic Value

information relating to the options outstanding as of October 31, 2025.:

Number Weighted

Exercise Price

Number Exercise Price

Prices Outstanding Life(Years) Outstanding Exercisable Exercisable Value

$ 1.93 206,945 0.99 $ 1.93 206,945 $ 1.93 $ 993,336

$ 2.12 70,000 0.99 $ 2.12 70,000 $ 2.12 $ 322,700

$ 2.37 182,500 1.38 $ 2.37 182,500 $ 2.37 $ 795,700

$ 2.61 170,000 1.38 $ 2.61 170,000 $ 2.61 $ 700,400

$ 2.65 20,000 0.88 $ 2.65 20,000 $ 2.65 $ 81,600

$ 2.75 30,000 1.25 $ 2.75 30,000 $ 2.75 $ 119,400

$ 3.75 37,500 0.10 $ 3.75 37,500 $ 3.75 $ 111,750

$ 3.98 30,000 0.25 $ 3.98 30,000 $ 3.98 $ 82,500

$ 4.12 25,000 0.10 $ 4.12 25,000 $ 4.12 $ 65,250

$ 5.99 30,000 1.67 $ 5.99 30,000 $ 5.99 $ 22,200

$ 6.22 260,833 2.81 $ 6.22 260,833 $ 6.22 $ 133,025

$ 6.84 108,334 2.81 $ 6.84 108,334 $ 6.84 $ -

$ 6.85 40,000 2.78 $ 6.85 40,000 $ 6.85 $ -

$ 7.34 180,918 2.23 $ 7.34 180,918 $ 7.34 $ -

$ 8.07 58,666 2.23 $ 8.07 58,666 $ 8.07 $ -

1,450,696 1.40 $ 4.55 1,450,696 $ 4.55 $ 3,427,861

SEGMENT REPORTING

We organize and manage our business

by the following two

segments which meet the definition of reportable segments under ASC280-10, Segment Reporting:

Sales of Goods and Services.

These segments

are based on the customer type of products or services provided and are the same as our business units.

financial information is available and regularly reviewed by our chief officer- decision maker, who is our chief

executive officer , in making resource allocation decisions for our segments.

Our chief officer decision maker evaluates segment

performance to the GAAP measure of gross profit.

Six Months Ended

by the following two segments which meet the definition of reportable segments under ASC280-10, Segment Reporting:

Sales of Goods and

These segments are based on the customer type of products or services provided and are the same as our business units.

financial information is available and regularly reviewed by our chief officer- decision maker, who is our chief executive officer , in

making resource allocation decisions for our segments.

Our chief officer decision maker evaluates segment performance to the GAAP measure

of gross profit.

Nine Months Ended

Three Months Ended

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about net sales and property and equipment, net of accumulated depreciation, in the United States and elsewhere.

Six Months Ended

Nine Months Ended

Three Months Ended

7 unchanged sentences

COMMITMENTS AND CONTIGENCIES

Employment Agreements

The Company entered into three-year

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The agreement provides

for an initial term, commencing on the effective date of the agreement and ending on January

31, 2025 , and continuing on a year-to-year basis thereafter unless terminated by either party on not less than 30 days’

notice given prior to the expiration of the initial term or any one-year extension.

For their services to the Company during the term

of the agreement, Mr.

for an initial term, commencing on the effective date of the agreement and ending on January 31, 2025 , and continuing on a year-to-year

basis thereafter unless terminated by either party on not less than 30 days’ notice given prior to the expiration of the initial

term or any one-year extension.

For their services to the Company during the term of the agreement, Mr.

Sheridan and Mr.

Melnik will receive an annual salary of $ 250,000

per annum, commencing on the effective date of the agreement.

Melnik will receive

an annual salary of $ 250,000 per annum, commencing on the effective date of the agreement.

Sheridan and Mr.

Melnik will also receive a performance bonus of 3.5 %

of net income before income taxes.

Melnik will also receive

a performance bonus of 3.5 % of net income before income taxes.

As of July 31, 2022, the Company and Mr.

Sheridan and Mr.

Melnik mutually agreed to reduce their annual

salary to $ 150,000 .

Melnik mutually

agreed to reduce their annual salary to $ 150,000 .

These agreements, and the employment of Mr.

Goodman, automatically renew for one-year terms following expiration of the initial three-year

terms and each successive one-year term.

Goodman, automatically renew for one-year

terms following expiration of the initial three-year terms and each successive one-year term.

The Company entered into a three-year

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his services to the Company during the term of the agreement, Mr.

Goodman will receive an annual salary of $ 210,000

per annum, commencing on the effective date of the agreement.

Goodman will receive an annual salary of $ 210,000 per annum, commencing

on the effective date of the agreement.

As of July 31, 2022, the Company and Mr.

Goodman mutually agreed to reduce

his annual salary to $ 110,000 .

Kindeva Drug Delivery

Goodman mutually agreed to reduce his annual salary to

Kindeva Drug Delivery Agreement

On January 4, 2024, the Company signed

3 unchanged sentences

of a New Drug Application (“NDA”).

As of January 31, 2025, the Company has incurred expenses of $ 3.0

million under this agreement.

The Company expects approximately $ 5.2

million to complete the development.

On February 4, 2025, the agreement was amended to reduce the hourly rate for the labor on the project

in exchange for a milestone payment payable upon FDA approval.

Under the amended agreement, the remaining budget as of July 31, 2025,

through NDA submission for the current workplan was reduced to $ 3.6

The amended agreement also includes a milestone payment of $ 3.0

million to be paid to Kindeva when the Company receives FDA approval.

As of January 31, 2025, the Company has incurred expenses of $ 3.0 million under this agreement.

The Company expects approximately $ 5.2 million to complete the development.

On February 4, 2025, the agreement was amended to reduce the

hourly rate for the labor on the project in exchange for a milestone payment payable upon FDA approval.

Under the amended agreement, the

remaining budget as of October 31, 2025, through NDA submission for the current workplan was reduced to $ 3.2 million.

The amended agreement

also includes a milestone payment of $ 3.0 million to be paid to Kindeva when the Company receives FDA approval.

Lease Agreement

On February 1, 2022, Pocono Pharmaceuticals

entered into a lease agreement with Geometric Group, LLC for 12,000

square feet of warehouse space currently occupied by Active Intelligence.

The monthly rental is $ 3,000

and the lease expires on January

The lease has been extended for an additional three years at the same monthly rental.

Therapeutics, Inc.

entered into a lease agreement with Geometric Group, LLC for 12,000 square feet of warehouse space currently occupied by Active Intelligence.

The monthly rental is $ 3,000 and the lease expires on January 31, 2025 .

The lease has been extended for an additional three years at the

same monthly rental.

Sorrento Therapeutics, Inc.

On July 25, 2023, 4P Therapeutics assigned

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and received proceeds of $ 106,528 .

The amount due under the claim was $ 118,675

and 4P Therapeutics recorded a reserve for bad debts of $ 118,675

during the year ended January 31, 2024.

Under the agreement with the buyer of the claim, 4P Therapeutics will make proportional restitution

and/or repayment of the purchase amount to the extent the claim is disallowed, reduced or not paid at the same time or distribution rate

as other general unsecured claims against the Debtor are paid.

The Company has recorded the amount of the proceeds as a secured loan payable

to the factor as of July 31, 2025.

The amount due under the

claim was $ 118,675 and 4P Therapeutics recorded a reserve for bad debts of $ 118,675 during the year ended January 31, 2024.

agreement with the buyer of the claim, 4P Therapeutics will make proportional restitution and/or repayment of the purchase amount to the

extent the claim is disallowed, reduced or not paid at the same time or distribution rate as other general unsecured claims against the

Debtor are paid.

The Company has recorded the amount of the proceeds as a secured loan payable to the factor as of October 31, 2025.

Legal Proceedings

The Company is currently a defendant

in a lawsuit initiated by Joseph Gunnar, LLC (“Gunnar”) and Lucosky Brookman LLP (“LB”) in the Supreme Court

of the State of New York, New York County, under Index No.654633/2023.

in a lawsuit initiated by Joseph Gunnar, LLC (“Gunnar”) and Lucosky Brookman LLP (“LB”) in the Supreme Court of

the State of New York, New York County, under Index No.654633/2023.

The lawsuit alleges multiple allegations such as breach of contract,

fraudulent activities, and tortious interference and seeks damages following the Company’s termination of an engagement letter

for assistance with a public stock offering.

Gunnar is seeking over $ 500,000

in damages plus punitive damages, while LB is demanding reimbursement of legal fees.

fraudulent activities, and tortious interference and seeks damages following the Company’s termination of an engagement letter for

assistance with a public stock offering.

Gunnar is seeking over $ 500,000 in damages plus punitive damages, while LB is demanding reimbursement

of legal fees.

In response, the Company denies all

3 unchanged sentences

$ 1,000,000 for each claim along with a declaratory judgment affirming the legality and justification of the termination.

The plaintiffs have denied

these counterclaims.

The plaintiffs

have denied these counterclaims.

Currently, there are no pending hearings

1 unchanged sentence

In early 2024, the plaintiffs proposed a settlement offer of $ 100,000 .

The Company has not responded to that proposed settlement offer.

has not responded to that proposed settlement offer.

SUBSEQUENT EVENTS

On August 11, 2025,

options to purchase common shares of the Company exercisable at a price of $ 6.85

per share to an executive officer.

The options vest immediately and expire three

years from the date of issuance.

The fair value of the options for services amounted to $ 137,040 .

The Company used the Black-Scholes valuation model to record the fair value.

On August 20, 2025, 369,167

options to purchase common shares of the Company were issued to executive officers and employees exercisable at prices of $ 6.22

The options vest immediately and expire three

years from the date of issuance.

The fair value of the options issued for services amounted to $ 1,148,102 .

The Company used the Black-Scholes valuation model to record the fair value.

has evaluated subsequent events through the filing of this Quarterly Report on Form 10-Q and determined there have been no events

that have occurred that would require adjustments to our disclosures in the consolidated financial statements.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements