NutriBand Inc. 10-Q

ITEM 1. FINANCIAL STATEMENTS Certain information and footnote disclosures required under accounting principles generally accepted in the United States of America have been condensed or omitted from the following financial statements pursuant to the rules and regulations of the Securities and Exchange Commission. 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. 1 NUTRIBAND INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS October 31, January 31, 2025 2025 (Unaudited) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 5,312,177 $ 4,311,719 Accounts receivable-net 147,562 73,847 Inventory 135,998 212,041 Prepaid expenses 219,327 196,658 Total Current Assets 5,815,064 4,794,265 PROPERTY & EQUIPMENT-net 587,968 695,063 OTHER ASSETS: Goodwill 1,719,535 1,719,535 Operating lease right of use asset 81,000 - Intangible assets-net 215,593 261,092 TOTAL ASSETS $ 8,419,160 $ 7,469,955 LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Accounts payable and accrued expenses $ 605,209 $ 698,821 Deferred revenue 6,974 155,880 Operating lease liability-current portion 31,722 - Notes payable-current portion 128,619 128,144 Total Current Liabilities 772,524 982,845 LONG-TERM LIABILITIES: Note payable-net of current portion 41,603 58,205 Operating lease liability-net of current portion 56,081 - Total Liabilities 870,208 1,041,050 Commitments and Contingencies - - STOCKHOLDERS’ EQUITY: 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 3,009 - 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 12,156 11,075 Additional paid-in-capital 53,345,152 45,029,317 Accumulated other comprehensive loss ( 304 ) ( 304 ) Treasury stock, 18,900 and 32,400 shares at cost, as of October 31, 2025 and January 31, 2025,respectively ( 86,852 ) ( 148,547 ) Accumulated deficit ( 45,724,209 ) ( 38,462,636 ) Total Stockholders’ Equity 7,548,952 6,428,905 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 8,419,160 $ 7,469,955 See notes to unaudited consolidated financial statements 2 NUTRIBAND INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) For the Three Months Ended For the Nine Months Ended October 31, October 31, 2025 2024 2025 2024 Revenue $ 346,058 $ 645,796 $ 1,635,942 $ 1,497,158 Costs and expenses: Cost of revenues 277,553 454,767 1,158,575 1,039,785 Research and development 457,113 880,768 1,703,093 2,629,278 Selling, general and administrative 3,491,728 737,102 6,071,320 2,554,155 Total Costs and Expenses 4,226,394 2,072,637 8,932,988 6,223,218 Loss from operations ( 3,880,336 ) ( 1,426,841 ) ( 7,297,046 ) ( 4,726,060 ) Other income (expense): Interest income 13,517 68,235 52,674 145,585 Loss on extinguishment of debt - - - ( 368,036 ) Interest expense ( 5,548 ) ( 4,031 ) ( 17,201 ) ( 17,668 ) Total other income (expense) 7,969 64,204 35,473 ( 240,119 ) Loss before provision for income taxes ( 3,872,367 ) ( 1,362,637 ) ( 7,261,573 ) ( 4,966,179 ) Provision for income taxes - - - - Net loss $ ( 3,872,367 ) $ ( 1,362,637 ) $ ( 7,261,573 ) $ ( 4,966,179 ) Preferred shares dividend - - ( 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 $ ( 0.32 ) $ ( 0.12 ) $ ( 2.54 ) $ ( 0.48 ) Weighted average common shares outstanding - basic and diluted 12,057,153 11,101,945 11,467,565 10,441,501 See notes to unaudited consolidated financial statements 3 NUTRIBAND INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED) Nine Months Ended October 31, 2025 Accumulated Common Stock Preferred Stock Additional Other Number of Number of Paid In Comprehensive Accumulated Treasury Total shares Amount shares Amount Capital Income(Loss) Deficit Stock Balance, February 1, 2025 $ 6,428,905 11,074,810 $ 11,075 - $ - $ 45,029,317 $ ( 304 ) $ ( 38,462,636 ) $ ( 148,547 ) Treasury stock issued for services 104,400 13,500 14 - - 42,691 - - 61,695 Exercise of warrants 5,305,503 825,117 825 - - 5,304,678 - - - Warrants issued for services 1,250,264 - - - - 1,250,264 - - - Exercise of employee stock options 119,206 40,055 40 - - 119,166 - - - Employee stock options exercised for settlement of debt 317,110 120,000 120 - - 316,990 - - - Preferred Shares issued as Common stock dividend - - - 3,008,643 3,009 ( 3,009 ) - - - Employee stock options issued for services 1,285,137 - - - - 1,285,137 - - - Cashless exercise of warrants - 82,501 82 - - ( 82 ) - - - Net loss ( 7,261,573 ) - - - - - - ( 7,261,573 ) - Balance, October 31, 2025 $ 7,548,952 12,155,983 $ 12,156 3,008,643 $ 3,009 $ 53,345,152 $ ( 304 ) $ ( 45,724,209 ) $ ( 86,852 ) Nine Months Ended October 31, 2024 Accumulated Common Stock Preferred Stock Additional Other Number of Number of Paid In Comprehensive Accumulated Treasury Total shares Amount shares Amount Capital Income(Loss) Deficit Stock Balance, February 1, 2024 $ 6,438,235 8,859,870 $ 8,860 - $ - $ 34,442,339 $ ( 304 ) $ ( 27,980,019 ) $ ( 32,641 ) Proceeds from sale of common stock and warrants 8,400,000 2,100,000 2,100 - - 8,397,900 - - - Options issued for services 553,335 - - - - 553,335 - - - Common stock and warrants issued for conversion of debt 672,958 76,230 76 - - $ 672,882 - - - Treasury stock and warrants issued for services 133,350 10,000 10 $ 100,699 - - 32,641 Cashless exercise of warrants - 60,085 60 - - $ ( 60 ) - - - Net loss ( 4,966,179 ) - - - - - - ( 4,966,179 ) - Balance, October 31, 2024 $ 11,231,699 11,106,185 $ 11,106 - $ - $ 44,167,095 $ ( 304 ) $ ( 32,946,198 ) $ - 4 Three Months Ended October 31, 2025 Accumulated Common Stock Preferred Stock Additional Other Number of Number of Paid In Comprehensive Accumulated Treasury Total shares Amount shares Amount Capital Income(Loss) Deficit Stock Balance, August 1, 2025 $ 8,493,808 12,015,983 $ 12,016 3,008,643 $ 3,009 $ 50,417,781 $ ( 304 ) $ ( 41,851,842 ) $ ( 86,852 ) Warrants issued for services 1,250,264 - - - - 1,250,264 - - - Exercise of employee stock options 75,000 20,000 20 - - 74,980 - - - Employee stock options exercised for settlement of debt 317,110 120,000 120 - - 316,990 - - - Employee stock options issued for services 1,285,137 - - - - 1,285,137 - - - Net loss ( 3,872,367 ) - - - - - - ( 3,872,367 ) - Balance, October 31, 2025 $ 7,548,952 12,155,983 $ 12,156 3,008,643 $ 3,009 $ 53,345,152 $ ( 304 ) $ ( 45,724,209 ) $ ( 86,852 ) Three Months Ended October 31, 2024 Accumulated Common Stock Preferred Stock Additional Other Number of Number of Paid In Comprehensive Accumulated Treasury Total shares Amount shares Amount Capital Income(Loss) Deficit Stock Balance, August 1, 2024 $ 12,460,986 11,096,185 $ 11,096 - $ - $ 44,066,396 $ ( 304 ) $ ( 31,583,561 ) $ ( 32,641 ) Treasury issued for services 133,350 10,000 10 - - 100,699 - - 32,641 Net loss ( 1,362,637 ) - - - - - - ( 1,362,637 ) - Balance, October 31, 2024 $ 11,231,699 11,106,185 $ 11,106 - $ - $ 44,167,095 $ ( 304 ) $ ( 32,946,198 ) $ - See notes to unaudited consolidated financial statements 5 NUTRIBAND INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) For the Nine Months Ended October 31, 2025 2024 Cash flows from operating activities: Net loss $ ( 7,261,573 ) $ ( 4,966,179 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 157,918 212,199 Operating lease expense 27,000 23,535 Loss on extinguishment of debt - 368,036 Stock-based compensation-shares issued for services 104,400 133,350 Stock-based compensation-options and warrants 2,535,483 553,335 Changes in operating assets and liabilities: Accounts receivable ( 73,715 ) 39,019 Prepaid expenses ( 22,669 ) ( 3,819 ) Inventories 76,043 306 Deferred revenue ( 148,906 ) 61,366 Operating lease liability ( 20,197 ) ( 25,412 ) Accounts payable and accrued expenses 223,416 216,944 Net Cash Used In Operating Activities ( 4,402,800 ) ( 3,387,320 ) Cash flows from investing activities: Purchase of equipment ( 5,324 ) ( 92,043 ) Net Cash Used in Investing Activities ( 5,324 ) ( 92,043 ) Cash flows from financing activities: Proceeds from note payable-related party - 300,000 Proceeds from the exercise of employee stock options 119,206 Proceeds from sale of common stock and exercise of warrants 5,305,503 8,400,000 Payment on note payable ( 16,127 ) ( 15,392 ) Net Cash Provided by Financing Activities 5,408,582 8,684,608 Net change in cash 1,000,458 5,205,245 Cash and cash equivalents - Beginning of period 4,311,719 492,942 Cash and cash equivalents - End of period $ 5,312,177 $ 5,698,187 Supplementary information: Cash paid for: Interest $ 1,250 $ 611 Income taxes $ - $ 2,043 Supplemental disclosure of non-cash investing and financing activities: Cashless conversion of warrants $ 82 $ 60 Measurement of operarating lease right-of-use assets and liabilities $ 108,000 $ - Debt settlement issued by the issuance of common stock and warrants $ - $ 672,956 Preferred Shares issued as Common stock dividend $ 21,814,166 $ - Options exercised in exchange for debt $ 317,110 $ - See notes to unaudited consolidated financial statements 6 NUTRIBAND INC. AND SUBSIDIARIES Notes to Unaudited Consolidated Financial Statements as of and for the Nine Months Ended October 31, 2025 and 2024 1. ORGANIZATION AND DESCRIPTION OF BUSINESS Organization Nutriband Inc. (the “Company”) is a Nevada corporation, incorporated on January 4, 2016. In January 2016, the Company acquired Nutriband Ltd, an Irish company which was formed by the Company’s chief executive officer in 2012 to enter the health and wellness market by marketing transdermal patches. References to the Company relate to the Company and its subsidiaries unless the context indicates otherwise. On August 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. 4P Therapeutics is engaged in the development of transdermal pharmaceutical products. With the acquisition of 4P Therapeutics, 4P Therapeutics’ drug development business became the Company’s principal business. The primary focus of the business is to incorporate the Company’s Aversa abuse deterrent technology into transdermal patches containing already approved drugs. Although these drugs are already approved, the Company needs to conduct a product development program which will include the preclinical and clinical trials that are necessary to receive FDA approval before we can market any of our pharmaceutical products. On August 25, 2020, the Company formed Pocono Pharmaceuticals Inc. (“Pocono Pharmaceuticals”), a wholly owned subsidiary of the Company. On August 31, 2020, the Company acquired certain assets and liabilities associated with the Transdermal, Topical, Cosmetic, and Nutraceutical businesses of Pocono Coated Products LLC (“PCP”). The net assets were contributed to Pocono Pharmaceuticals. Included in the transaction, Pocono Pharmaceuticals also acquired 100 % of the membership interests of Active Intelligence LLC (“Active Intelligence”). Pocono Pharmaceuticals is a coated products contract development and manufacturing organization that supports their customers with product design, development and manufacturing services. Pocono Pharmaceuticals has specialized expertise and state-of-the-art manufacturing capabilities for topical, transdermal and kinesiology tape products. Active Intelligence manufactures activated kinesiology tape for customers in the sports and physical markets. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 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 and footnote disclosures required under generally accepted accounting principles in the United States of America ({U.S. GAAP}) have been condensed or omitted from these consolidated financial statements pursuant to the rules and regulations, including interim reporting requirements of the U.S. Securities and Exchange Commission (“SEC”). The preparation of consolidated statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and the disclosures of contingent amounts in our consolidated financial statements and accompanying footnotes. Actual results could differ from estimates. The Company’s 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 nine months ended October 31, 2025. 7 Going Concern Assessment Management 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 . 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 nine months ended October 31, 2025, the Company received proceeds of $ 5,305,503 from the exercise of warrants. Management has prepared estimates for operations for the next twelve months and believes that sufficient funds will be generated from operations to fund its operations for one year from the date of the filing of these condensed consolidated financial statements, which indicates improved operations and the Company’s ability to continue operations as a going concern. Management believes the substantial doubt about the ability of the Company to continue as a going concern is alleviated by the above assessment. Principles of Consolidation The consolidated financial statements of the Company include the Company and its wholly owned subsidiaries. All material intercompany balances and transactions have been eliminated. 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: Nutriband Ltd. 4P Therapeutics LLC Pocono Pharmaceuticals Inc. Use of Estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, the Company evaluates its estimates including, but not limited to, those related to such items as income tax exposures, accruals, depreciable/useful lives, allowance for doubtful accounts and valuation allowances. The Company bases its estimates on historical experience and on other various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. 8 Revenue Recognition In May 2014, 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: 1) identify the contract, 2) identify separate performance obligations, 3) determine the transaction price, 4) allocate the transaction price among the performance obligations, and 5) recognize revenue as the performance obligations are satisfied. Revenue Types The following 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. Contracts with Customers A contract with a customer exists when (i) we enter into an enforceable contract with a customer that defines each party’s rights regarding the goods or services to be transferred and identifies the payment terms related to these goods or services, (ii) the contract has commercial substance and, (iii) we determine that collection of substantially all consideration for services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. Contract Liabilities Deferred revenue is a liability related to a revenue producing activity for which revenue has not been recognized. The Company records deferred revenue when it receives consideration 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 in a contract to transfer a distinct good or service to the customer and is the unit of accounts in the new revenue standard. The contract transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. For the Company’s different revenue service types, the performance obligation is satisfied at different times. The Company’s performance obligations include providing products and professional services in the area of research. The Company recognizes product revenue performance obligations in most cases when the product has shipped to the customer. When we perform professional service work, we recognize revenue when we have the right to invoice the customer for the work completed, which typically occurs over time on a monthly basis for the work performed during that month. All revenue recognized in the income statement is considered to be revenue from contracts with customers. 9 Disaggregation of Revenues The Company disaggregates its revenue from contracts with customers by type and by geographical location. See the tables: Nine Months Ended Three Months Ended October 31, October 31, 2025 2024 2025 2024 Revenue by type Sale of goods $ 1,635,942 $ 1,497,158 $ 346,058 $ 645,796 Services - - - - Total $ 1,635,942 $ 1,497,158 $ 346,058 $ 645,796 Nine Months Ended Three Months Ended October 31, October 31, 2025 2024 2025 2024 Revenue by geographic location: United States $ 1,628,312 $ 1,497,158 $ 346,058 $ 645,796 Foreign 7,630 - - - $ 1,635,942 $ 1,497,158 $ 346,058 $ 645,796 Cash 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 October 31, 2025, the Company had approximately $ 4,900,000 that exceeded federally insured cash balance limits. Accounts receivable Trade accounts receivables are recorded at the net invoice value and are not interest bearing. The Company maintains allowances for doubtful accounts for estimated losses from the inability of its customers to make the required payments. The Company determines its allowances by both specific identification of customer accounts where appropriate and the application of historical loss to non-applicable accounts. For 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. Inventories Inventories are valued at the lower of cost and reasonable value determined using the first-in, first-out (FIFO) method. Net realized value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses. The cost of finished goods and work in process is comprised of material costs, direct labor costs and other direct costs and related production overheads (based on normal operating capacity). 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 . Property, Plant and Equipment Property and equipment represent an important component of the Company’s assets. The Company depreciates its plant and equipment on a straight-line basis over the estimated useful life of the assets. Property, plant and equipment is stated at historical cost. Expenditures for minor repairs, maintenance and replacement parts which do not increase the useful lives of the assets are charged to expense as incurred. All major additions and improvements are capitalized. Depreciation is computed using the straight-line method. The lives over which the fixed assets are depreciated range from 3 to 20 years as follows: Lab Equipment 5 - 10 years Furniture and fixtures 3 - 5 years Machinery and equipment 5 - 20 years 10 Intangible Assets Intangible 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 with indefinite lives are tested annually for impairment. 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 Goodwill represents the difference between the total purchase price and the fair value of assets (tangible and intangible) and liabilities at the date of acquisition. Goodwill is reviewed for impairment annually on January 31, and more frequently as circumstances warrant, and written down only in the period in which the recorded value of such assets exceeds their fair value. The Company does not amortize goodwill in accordance with ASC 350. In connection with the Company’s acquisition of 4P Therapeutics LLC in 2018, the Company recorded Goodwill of $ 1,719,235 . On August 31, 2020, in connection with the Company’s acquisition of Pocono Coated Products LLC and Active Intelligence LLC, the Company recorded Goodwill of $ 5,810,640 . During the years ended January 31, 2025 and 2024, the Company recorded an impairment charge of $ 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. Long-lived Assets Management reviews long-lived assets for potential impairment whenever significant events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment exists when the carrying amount of the long-lived asset is not recoverable and exceeds its fair value. The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of the estimated undiscounted cash flows expected to result from the use and eventual disposition of the asset. If an impairment exists, the resulting write-down would be the difference between the fair market value of the long-lived asset and the related book value. Treasury Stock The Company records the purchase of its treasury shares under the historical cost method. The reissuance of treasury shares are recorded using the average cost method. Earnings per Share Basic earnings per share of common stock is computed by dividing net earnings by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing net earnings by the weighted average number of shares of common stock and potential shares of common stock outstanding during the period. Potential shares of common stock consist of shares issuable upon the exercise of outstanding options and common stock purchase warrants. 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. Stock-Based Compensation ASC 718, “Compensation - Stock Compensation,” prescribes accounting and reporting standards for all share-based payment transactions in which employee services, and, since February 1, 2019, non-employees, are acquired. Transactions include incurring liabilities, or issuing or offering to issue shares, options and other equity instruments such as employee stock ownership plans and stock appreciation rights. Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period). As of February 1, 2019, pursuant to ASC 2018-07, ASC 718 was applied to stock-based compensation for both employees and non-employees. 11 Business Combinations The Company recognizes the assets acquired, the liabilities assumed, and any non-controlling interest in the acquired entity at the acquisition date, measured at their fair values as of that date, with limited exceptions specified in the accounting literature. In accordance with this guidance, acquisition-related costs, including restructuring costs, must be recognized separately from the acquisition and will generally be expensed as incurred. That replaces the cost-allocation process detailed in previous accounting literature, which required the cost of an acquisition to be allocated to the individual assets acquired and liabilities assumed based on their estimated fair value. Leases In February 2016, the FASB issued ASU 2016-02, “Leases” (Topic 842), to provide a new comprehensive model for lease accounting under this guidance, lessees and lessors should apply a “right-of-use” model in accounting for all leases (including subleases) and eliminate the concept of operating leases and off-balance-sheet leases. Recognition, measurement and presentation of expenses will depend on classification as a finance or operating lease. Similar modifications have been made to lessor accounting in-line with revenue recognition guidance. The Company applies guidance for right-of-use accounting for all leases and records the operating lease liabilities on its balance sheet. The Company completed the necessary changes to its accounting policies, processes, disclosure and internal control over financial reporting. Research and Development Expenses Research and development costs are expensed as incurred. Income Taxes Taxes are calculated in accordance with taxation principles currently effective in the United States and Ireland. The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company records net deferred tax assets to the extent they believe these assets will more likely than not be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent financial operations. In the event the Company was determined that it would be able to realize its deferred income tax assets in the future in excess of its net recorded amount, the Company would make an adjustment to the valuation allowance which would reduce the provision for income taxes. Fair Value Measurements FASB ASC 820, “Fair Value Measurements and Disclosure” (“ASC 820”), defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between participants on the measurement date. ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of input that may be used to measure fair value. The Company utilizes the accounting guidance for fair value measurements and disclosures for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis during the reporting period. The fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based upon the best use of the asset or liability at the measurement date. The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability. ASC 820 establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers are defined as follows: Level 1 - Observable inputs such as quoted market prices in active markets. Level 2 - Inputs other than quoted prices in active markets that are either directly or indirectly observable. Level 3 - Unobservable inputs about which little or no market data exists, therefore requiring an entity to develop its own assumptions. 12 The carrying value of the Company’s financial instruments, including accounts receivable, prepaid expenses, accounts payable and accrued expenses, and deferred revenue approximate their fair value due to the short maturities of these financial instruments. Recent Accounting Standards The Company has reviewed all other FASB-issued ASU accounting pronouncements and interpretations thereof that have effective dates during the period reported and in future periods. The Company has carefully considered the new pronouncements that alter previous GAAP and does not believe that any new or modified principles will have a material impact on the Company’s reported financial position or operations in the near term. The applicability of any standard is subject to the formal review of the Company’s financial management and certain standards are under consideration. 3. PROPERTY AND EQUIPMENT October 31, January 31, 2025 2025 Lab equipment $ 144,585 $ 144,585 Machinery and equipment 1,389,756 1,384,432 Furniture and fixtures 19,643 19,643 1,553,984 1,548,660 Less: Accumulated depreciation ( 966,016 ) ( 853,597 ) Net Property and Equipment $ 587,968 $ 695,063 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. 4. 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 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 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 $ 17,324 is current. As of January 31, 2025, the amount due was $ 69,132 . On April 3, 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 was financed. The agreement is for five years bearing interest at 2.95 % per annum with payments of $ 410 per month. The loan is 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 . 13 Note payable-related party. On July 17, 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 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 loss on extinguishment. 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. Secured borrowing liability. On July 19, 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. 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 nine months ended October 31, 2025, and 2024, were $ 17,201 and $ 17,668 , respectively. 5. INTANGIBLE ASSETS 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, as follows: October 31, January 31, 2025 2025 Customer base $ 214,640 $ 214,640 Intellectual property and trademarks 623,822 623,822 Total 838,462 838,462 Less: Accumulated amortization ( 622,869 ) ( 577,370 ) Net Intangible Assets $ 215,593 $ 261,092 Amortization 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. Total Year Ended January 31, 2026 $ 15,187 2027 60,666 2028 60,666 2029 41,736 2030 23,596 2031 and thereafter 13,742 $ 215,593 14 6. RELATED PARTY TRANSACTIONS 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 . The fair 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. 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. 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. 7. STOCKHOLDERS’ EQUITY 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 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. 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 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 preferred stock dividend was $ 21,814,622 . Common Stock 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. 15 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. The shares were issued from the treasury shares held by the Company. 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. (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 stock. (h) In October 2025, the Company’s CFO exercised employee exercised employee stock options. The Company received proceeds of $ 75,000 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. The Company 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. 8. OPTIONS and WARRANTS Warrants On April 19, 2024, in connection with 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 152,460 warrants in connection with extinguishment of debt of $ 300,000 and accrued interest. The warrants are exercisable at a price of $ 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 debt. 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. 16 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 years; volatility rates of 105.98 %- 145.05 %; and risk-free rates of 3.65 %- 4.45 %. 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 rate of 0 %; 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 - - Exercised ( 88,525 ) 1.98 - - Outstanding, January 31, 2025 5,546,973 5.85 3.68 years - Granted 340,393 6.00 - - Expired/Cancelled - - - - 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 17 The following table summarizes additional information relating to the warrants outstanding as of October 31, 2025: Range of Exercise Number Remaining Contractual Exercise Price for Shares Number Exercise Price for Shares Intrinsic 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 Options 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 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. 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 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, 689,584 options to purchase shares of the Company’s common stock were issued to executive officers and employees at prices of $ 2.37 - $ 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 years; volatility rate of 97.83 %- 114.86 %; and a risk-free rate of 4.00 %- 4.87 %. 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 %- 108.35 %; and a risk-free rate of 3.69 %- 3.91 %. 18 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. 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 ) - - Exercised - - - Outstanding, January 31, 2025 1,373,668 3.23 1.90 years Granted 409,167 6.44 - Expired/Cancelled ( 172,084 ) - - 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 October 31, 2025.: Weighted Average Weighted Average Range of Exercise Number Weighted Average Exercise Price for Shares Number Exercise Price for Shares Intrinsic 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 19 9. 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. Separate 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 October 31, October 31, 2025 2024 2025 2024 Net sales Pocono Pharmaceuticals $ 1,635,942 $ 1,497,158 $ 346,058 $ 645,796 4P Therapeutics - - - - 1,635,942 1,497,158 346,058 645,796 Gross profit Pocono Pharmaceuticals 477,367 457,373 68,505 191,029 4P Therapeutics - - - - 477,367 457,373 68,505 191,029 Operating expenses Selling, general and administrative-Pocono Pharmaceuticals 453,970 494,723 142,616 173,655 Selling, general and administrative-4P Therapeutics 163,031 78,499 110,404 23,896 Selling, general and administrative-Corporate 5,454,319 1,980,933 3,238,704 539,551 Research and development-4P Therapeutics 1,703,093 2,629,278 457,113 880,768 7,774,413 5,183,433 3,948,837 1,617,870 Depreciation and Amortization Pocono Pharmaceuticals $ 130,116 $ 175,365 $ 33,689 $ 60,871 Corporate - 9,032 - 3,011 4P Therapeutics 27,802 27,802 9,267 9,267 $ 157,918 $ 212,199 $ 42,956 $ 73,149 The following table presents information about net sales and property and equipment, net of accumulated depreciation, in the United States and elsewhere. Nine Months Ended Three Months Ended October 31, October 31, 2025 2024 2025 2024 Net sales United States $ 1,628,412 $ 1,497,158 $ 346,058 $ 645,796 Outside the United States 7,530 - - - $ 1,635,942 $ 1,497,158 $ 346,058 $ 645,796 October 31, January 31, 2025 2025 Property and equipment, net of accumulated depreciation United States $ 587,968 $ 695,063 Outside the United States - - $ 587,968 $ 695,063 Assets Corporate $ 4,774,445 $ 4,205,577 Pocono Pharmaceuticals 1,817,532 1,404,285 4P Therapeutics 1,827,183 1,859,793 $ 8,419,160 $ 7,469,655 20 10. COMMITMENTS AND CONTIGENCIES Employment Agreements The Company entered into three-year employment agreements with Gareth Sheridan, our CEO, and Serguei Melnik, our President, effective February 1, 2022. The agreement also provides that the executives will continue as directors and officers of the Company for the respective terms thereof. 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. Sheridan and Mr. Melnik will receive an annual salary of $ 250,000 per annum, commencing on the effective date of the agreement. Mr. Sheridan and Mr. 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 . 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. The Company entered into a three-year employment agreement with Gerald Goodman, our CFO, effective February 1, 2022. 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 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. As of July 31, 2022, the Company and Mr. Goodman mutually agreed to reduce his annual salary to $ 110,000 . Kindeva Drug Delivery Agreement On January 4, 2024, the Company signed a commercial development and clinical supply agreement for their lead product, Aversa Fentanyl, with Kindeva Drug Delivery, L.P. (“Kindeva”). Under this agreement, Kindeva will perform commercial manufacturing process development, manufacturing of clinical supplies for the human abuse liability clinical study, and development of chemistry, manufacturing and controls (CMC) information required by the FDA in support 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 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 31, 2025 . The lease has been extended for an additional three years at the same monthly rental. 21 Sorrento Therapeutics, Inc. Agreement On July 25, 2023, 4P Therapeutics assigned its claim under the bankruptcy proceedings from Sorrento Therapeutics Inc. 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 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. 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. In response, the Company denies all allegations, alleging that the engagement letter was unenforceable, and its termination was legally justified. The Company has also initiated counterclaims against Joseph Gunnar & Co., accusing them of intentional interference and breach of fiduciary duty, and is seeking $ 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. Currently, there are no pending hearings or motions, and the case is in the discovery stage. In early 2024, the plaintiffs proposed a settlement offer of $ 100,000 . The Company has not responded to that proposed settlement offer. 11. SUBSEQUENT EVENTS The Company 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. 22