What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-11-13 compared with 2024-08-19 · 194 added, 208 removed, 188 unchanged (68% of the section changed)

46 unchanged sentences

inability to carry out our business plans.

a discussion of these and other risks that relate to our business and investing in shares of our common stock, you should carefully review

the risks and uncertainties described elsewhere in this Quarterly Report on Form 10-Q.

The forward-looking statements contained in this

Quarterly Report on Form 10-Q are expressly qualified in their entirety by this cautionary statement.

We do not undertake any obligation

to publicly update any forward-looking statement to reflect events or circumstances after the date on which any such statement is made

or to reflect the occurrence of unanticipated events.

manufacture high water content, electron beam cross-linked, aqueous polymer hydrogels, or gels, used for wound care, medical diagnostics,

a discussion of these and other risks that relate to our business and investing in shares of our common stock, you should carefully

review the risks and uncertainties described elsewhere in the Company’s Annual Report on Form 10-K filed with the SEC on April

The forward-looking statements contained in this Quarterly Report on Form 10-Q are expressly qualified in their entirety

by this cautionary statement.

We do not undertake any obligation to publicly update any forward-looking statement to reflect events

or circumstances after the date on which any such statement is made or to reflect the occurrence of unanticipated events.

From 2019 through November 2023, we only

manufactured high water content, electron beam cross-linked, aqueous polymer hydrogels, or gels, used for wound care, medical diagnostics,

transdermal drug delivery and cosmetics.

15 unchanged sentences

color and texture.

On March 1, 2023, the Company acquired a 50% interest

in a newly formed JV for its converting and packaging business.

The new JV expands the Company’s offerings, allowing it to reach

more customers with a variety of gel shapes and sizes.

The Company had limited converting and packaging operations in its Langhorne Facility,

making a JV to expand capacity an attractive opportunity.

in December 2023, the Company expanded their product portfolio to include the Kenkoderm brand.

Kenkoderm is a skincare line focused on

reducing symptoms associated with psoriasis.

Kenkoderm products do not utilize our gel technology and are manufactured by third parties.

Beginning in May 2024, the Company added the Silly

George brand.

Silly George is a beauty and cosmetics company focused on eyeliner, fake eyelashes, lash growth serum and mascara.

Kenkoderm is a skincare line focused

on reducing symptoms associated with psoriasis.

Kenkoderm products do not utilize our gel technology and are manufactured by third

This marks the first time the company expanded its product portfolio to include products unrelated to its core gel

in May 2024, the Company added the Silly George brand.

Silly George is a beauty and cosmetics company focused on eyeliner, fake

eyelashes, lash serum and mascara.

Similar to Kenkoderm, Silly George products are purchased and resold from third party

manufacturers.

This second acquisition further expanded the Company’s retail sales presence in products unrelated to its core

gel technology.

March 1, 2023, the Company acquired a 50% interest in its newly formed JV for its converting and packaging business.

2 unchanged sentences

As a result of this transaction, the Company owns 50% of the JV, with the remaining 50% held by CG Labs.

Enigma Health

On January 6, 2023, the Company acquired a 50% interest

in its newly formed JV to pursue branded consumer product retail opportunities and the development of new patch products.

The JV agreement

is effective January 6, 2023.

As a result of this transaction, the Company owns 50% of the JV, with the remaining 50% held by Moiety.

December 1, 2023, we purchased substantially all of the assets of Olympus Trading Company, LLC (the “Kenkoderm Seller”)

related to the Seller’s skincare line focused on reducing symptoms associated with psoriasis operating under the tradename

“Kenkoderm” (“Kenkoderm acquisition”).

the terms of the Kenkoderm acquisition, the Company paid the Seller a cash payment of $546,500.

Additionally,

the Company will pay the Kenkoderm Seller a cash earn-out of the same amount each quarter, payable in the subsequent month flowing quarter

end, of $136,625, subject to adjustment.

The cash earn-out can fluctuate higher or lower based on the quarterly results of the Kenkoderm

business during 2024 according to the formula contained in the Asset Purchase Agreement relating to the Kenkoderm acquisition.

May 15, 2024, the Company purchased assets from Semmens Online Pty Ltd as Trustee for Semmens Business Trust (the “SG Seller”)

related to the SG Seller’s eyeliner, fake eyelashes, lash growth serum and mascara business operating under the tradename “Silly

George” (collectively, the “Business”).

the terms of the Purchase Agreement and on the Closing Date, the Company paid the SG Seller a cash payment of $400,000 and issued $200,000

in shares of the Company’s common stock based on the 10-Day VWAP (as defined in the SG Purchase Agreement), or 89,892 of shares

of the Company’s common Stock.

Additionally, the Company shall pay the Seller a cash earn-out based on 20% of the Net Profit (as

defined in the SG Purchase Agreement) related to the Business for the fiscal quarterly period beginning June 30, 2024 and ending on June

January 6, 2023, the Company acquired a 50% interest in its newly formed JV to pursue branded consumer product retail opportunities and

the development of new patch products.

The JV agreement is effective January 6, 2023.

As a result of this transaction, the Company owns

50% of the JV, with the remaining 50% held by Moiety.

December 1, 2023, we purchased substantially all of the assets of Olympus Trading Company, LLC (the “Kenkoderm Seller”) related

to the Seller’s skincare line focused on reducing symptoms associated with psoriasis operating under the tradename “Kenkoderm”

(“Kenkoderm acquisition”).

May 15, 2024, the Company purchased substantially all of the assets from Semmens Online Pty Ltd as Trustee for Semmens Business Trust

related to the SG Seller’s eyeliner, fake eyelashes, lash serum and mascara business operating under the tradename “Silly

of Operations

1 unchanged sentence

of operations for the comparison periods identified.

of the Three Months ended June 30, 2024 and 2023 ($ in thousands)

the three months ended June 30, 2024 revenues were $1,440 and increased by $273, or 23.4%, when compared to $1,167 for the three

months ended June 30, 2023.

of the Three Months ended September 30, 2024 and 2023 ($ in thousands)

the three months ended September 30, 2024 revenues were $2,940 and increased by $1,719, or 140.8%, when compared to $1,221 for the three

months ended September 30, 2023.

The increase in our overall revenues was primarily due to sales growth in our branded consumer products,

including gross revenue from Silly George of $380 from May 15, 2024 through June 30, 2024, and partially offset by a decrease in

contract manufacturing.

including gross revenue from Silly George of $1,373 for the three months ending September 30, 2024, and partially offset by a decrease

in contract manufacturing.

Company has four distinct lines of business;

Contract Manufacturing, Custom and White Label, Branded Consumer Products, and Medical

Contract Manufacturing, Custom and White Label, Branded Consumer Products, and Medical Devices.

Manufacturing

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is responsible for sales, marketing, and distribution.

These products carry the Company’s brand names.

These products carry the Company’s brand names, which include Medagel, Lumagel

Beauty, Kenkoderm and Silly George.

Devices/Other

Devices are a hybrid business, combining elements of Custom and White Label and Branded Consumer Products.

Medical Devices, which

are not yet marketed, are expected to be distributed through strategic partnerships.

The Company will manufacture and possibly

convert/package the device while the strategic partner brings the product to market.

Small market Medical Devices could be launched

by the Company, but also be offered to a distributor to reach the full scale of the market.

Our gross profit was $410 for the three months ended June 30, 2024 compared to a gross profit of $175 thousand for the

three months ended June 30, 2023.

The increase of $235 in gross profit quarter over quarter was primarily due to the increase in branded consumer products.

Gross profit was 28.5% for the three months ended June 30, 2024 compared to a gross profit of 15.0% for the

three months ended June 30, 2023.

components of cost of revenues are as follows for the three months ended June 30, 2024 and 2023 ($ in thousands):

Three Months Ended

Medical Devices, which are

not yet marketed, are expected to be distributed through strategic partnerships.

The Company will manufacture and possibly convert/package

the device while the strategic partner brings the product to market.

Small market Medical Devices could be launched by the Company, but

also be offered to a distributor to reach the full scale of the market.

includes freight charged to customers who purchase the Company’s branded consumer products through their Shopify stores.

Our gross profit was $1,282 thousand for the three months ended September 30, 2024 compared to a gross profit of $344 thousand

for the three months ended September 30, 2023.

The increase of $938 in gross profit quarter over quarter was primarily due to the increase

in branded consumer products.

Gross profit was 43.6% for the three months ended September 30, 2024 compared to a gross profit of 28.2%

for the three months ended September 30, 2023.

components of cost of revenues are as follows for the three months ended September 30, 2024 and 2023 ($ in thousands):

and finished products

and amortization

production and other expenses

cost of revenues

Materials and finished products

Share-based compensation

Compensation and benefits

Depreciation and amortization

Equipment, production and other expenses

Total cost of revenues

of revenues increased by $38, or 3.8%, to $1,030 for the three months ended June 30, 2024, as compared to $992 for the three months ended

June 30, 2023.

The increase in cost of revenues is primarily aligned with sales of branded consumer products, as both Silly George and Kenkoderm were acquired after the comparable 2023 time period.

of revenues increased by $781, or 89.1%, to $1,658 for the three months ended September 30, 2024, as compared to $877 for the three months

ended September 30, 2023.

The increase in cost of revenues is primarily aligned with sales of branded consumer products, as both Silly

George and Kenkoderm were acquired after the comparable 2023 time period.

general and administrative expenses .

The following table highlights Selling, general and administrative expenses by type for the

three months ended June 30, 2024 and 2023 ($ in thousands):

Three Months Ended

three months ended September 30, 2024 and 2023 ($ in thousands):

general and administrative expenses

and amortization

marketing, and Amazon fees

and shareholder services

tax and corporate insurance

and consulting fees

expenses and professional fees

Selling, general and administrative expenses

Compensation and benefits

Share-based compensation

Depreciation and amortization

Advertising, marketing, and Amazon fees

Investor and shareholder services

Franchise tax and corporate insurance

Professional and consulting fees

Other expenses and professional fees

Total Selling, general and administrative expenses

general and administrative expenses increased by $506, or 57.4%, to $1,388 for the three months ended June 30, 2024, as compared to

$882 for the three months ended June 30, 2023.

The increase in Selling, general and administrative expenses is primarily

attributable to the factors described below.

and benefits increased by $76, or 43.2%, to $252 for the three months ended June 30, 2024, as compared to $176 for the three months ended

June 30, 2023.

The number of employees increased compared to the prior period and officer compensation increased in conjunction with

contract renewals.

compensation increased by $30 or 130.4%, to $53 for the three months ended June 30, 2024, as compared to $23 for the three months

ended June 30, 2023.

general and administrative expenses increased by $1,120, or 117.9%, to $2,070 for the three months ended September 30, 2024, as compared

to $950 for the three months ended September 30, 2023.

The increase in Selling, general and administrative expenses is primarily attributable

to the factors described below.

and benefits increased by $70, or 41.4%, to $239 for the three months ended September 30, 2024, as compared to $169 for the three months

ended September 30, 2023.

The number of employees increased compared to the prior period and officer compensation increased in conjunction

with contract renewals.

compensation increased by $77 or 116.7%, to $143 for the three months ended September 30, 2024, as compared to $66 for the three months

ended September 30, 2023.

The increase related to the issuance of stock options and restricted awards to our officers, employees, board

of directors, and advisors.

marketing, Amazon fees increased by $276, or 166.3%, to $442 for the three months ended June 30, 2024, as compared to $166 for the three

months ended June 30, 2023.

The increase is due to the increased Amazon selling fees and an increase in advertising and marketing attributable

to promoting Kenkoderm and Silly George.

and shareholder services decreased by $52 or 37.1%, to $88 for the three months ended June 30, 2024, as compared to $140 for the three

months ended June 30, 2023.

marketing, Amazon fees increased by $819, or 460.1%, to $997 for the three months ended September 30, 2024, as compared to $178 for the

three months ended September 30, 2023.

The increase is due to the increased Amazon selling fees and an increase in advertising and marketing

attributable to promoting Kenkoderm and Silly George.

and shareholder services decreased by $39 or 45.3%, to $47 for the three months ended September 30, 2024, as compared to $86 for the

three months ended September 30, 2023.

The decrease is due to a net reduction of investor services compared to the prior year period.

taxes and corporate insurance decreased by $41, or 65.1%, to $22 for the three months ended June 30, 2024, as compared to $63

thousand for the three months ended June 30, 2023.

In the prior year period, a non-recurring adjustment resulted in an increase in

franchise taxes.

and consulting fees increased by $155, or 63.0%, to $401 for the three months ended June 30, 2024, as compared to $246 for the three

months ended June 30, 2023.

We continued to incur accounting and consulting fees associated with public company governance

requirements and professional services related to branded consumer products.

Expenses increased by $26, or 50.0%, to $78 for the three months ended June 30, 2024 from $52 for the three months ended June 30 2023.

Other Selling, general and administrative expenses generally consist of normal costs associated with our selling efforts and general

management, including information technology, travel, training and recruiting.

taxes and corporate insurance decreased by $14, or 26.9%, to $38 for the three months ended September 30, 2024, as compared to $52 thousand

for the three months ended September 30, 2023.

In the prior year period, a non-recurring adjustment resulted in an increase in franchise

and consulting fees increased by $104, or 38.4%, to $375 for the three months ended September 30, 2024, as compared to $271 for the three

months ended September 30, 2023.

We continued to incur accounting and consulting fees associated with public company governance requirements

and professional services related to branded consumer products.

Expenses increased by $81, or 65.9%, to $204 for the three months ended September 30, 2024 from $123 for the three months ended September

Other Selling, general and administrative expenses generally consist of normal costs associated with our selling efforts and

general management, including information technology, travel, training and recruiting.

and development expenses .

Research and development expenses increased by $21, or 38.2%, to $76 for the three months ended June

30, 2024 from $55 for the three months ended June 30, 2023.

Research and development expenses decreased by $6, or 100%, to $0 for the three months ended September 30,

2024 from $6 for the three months ended September 30, 2023.

Research and development expenses are related to research costs incurred

for potential products for existing or new customers.

of the Six Months ended June 30, 2024 and 2023 (in thousands)

the six months ended June 30, 2024, revenues were $2,706 and increased by $920, or 51.5%, when compared to $1,786 for the six months

ended June 30, 2023.

The increase in our overall revenues was primarily due to sales growth in our branded consumer products, including

gross revenue from Silly George of $380 from May 15, 2024 through June 30, 2024, and partially offset by a decrease in contract manufacturing.

Our gross profit was $687 for the six months ended June 30, 2024, compared to a gross profit of $117 for the six months ended

June 30, 2023.

The increase of $570 in gross profit recorded for the six months ended June 30, 2024, as compared to the six months ended

June 30, 2023, was primarily due to increase in branded consumer products.

Gross profit was approximately 25.4% for the six months ended June 30, 2024,

compared to a gross profit of 6.6% for the six months ended June 30, 2023.

components of cost of revenues are as follows for the six months ended June 30, 2024 and 2023 ($ in thousands):

Six Months Ended

of the Nine Months ended September 30, 2024 and 2023 (in thousands)

the nine months ended September 30, 2024, revenues were $5,647 and increased by $2,640, or 87.8%, when compared to $3,007 for the nine

months ended September 30, 2023.

The increase in our overall revenues was primarily due to sales growth in our branded consumer products,

including gross revenue from Silly George of $1,753 from May 15, 2024 through September 30, 2024, and partially offset by a decrease

in contract manufacturing.

Our gross profit was $1,969 for the nine months ended September 30, 2024, compared to a gross profit of $461 for the nine

months ended September 30, 2023.

The increase of $1,508 in gross profit recorded for the nine months ended September 30, 2024, as compared

to the nine months ended September 30, 2023, was primarily due to increase in branded consumer products.

Gross profit was approximately

34.9% for the nine months ended September 30, 2024, compared to a gross profit of 15.3% for the nine months ended September 30, 2023.

components of cost of revenues are as follows for the nine months ended September 30, 2024 and 2023 ($ in thousands):

and finished products

based compensation

and amortization

production, and other expenses

cost of revenues

Materials and finished products

Share based compensation

Compensation and benefits

Depreciation and amortization

Equipment, production, and other expenses

Total cost of revenues

of revenues increased by $350, or 21.0%, to $2,019 for the six months ended June 30, 2024, as compared to $1,669 for the six months ended

June 30, 2023.

of revenues increased by $1,132, or 44.5%, to $3,678 for the nine months ended September 30, 2024, as compared to $2,546 for the nine

months ended September 30, 2023.

The increase in cost of revenues pertains to an increase in materials and finished products.

The increase in cost of revenues is primarily aligned with sales of branded consumer products, as both Silly George

and Kenkoderm were acquired after the comparable 2023 time period.

in cost of revenues is primarily aligned with sales of branded consumer products, as both Silly George and Kenkoderm were acquired after

the comparable 2023 time period.

general, and administrative expenses .

The following table highlights selling, general, and administrative expenses by type for the

six months ended June 30, 2024 and 2023 ($ in thousands):

Six Months Ended

nine months ended September 30, 2024 and 2023 ($ in thousands):

general, and administrative expenses

and amortization

marketing, and Amazon fees

and shareholder services

tax and corporate insurance

and consulting fees

selling, general and administrative expenses

Compensation and benefits

Share-based compensation

Depreciation and amortization

Advertising, marketing, and Amazon fees

Investor and shareholder services

Franchise tax and corporate insurance

Professional and consulting fees

Other expenses

Total selling, general and administrative expenses

general, and administrative expenses increased by $855, or 50.9%, to $2,534 for the six months ended June 30, 2024, as compared to

$1,679 for the six months ended June 30, 2023.

The increase in selling, general, and administrative expenses is primarily

attributable to increased Advertising, marketing and Amazon fees, which directly correlates to our growth in branded consumer

and benefits increased by $183, or 57.0%, to $504 for the six months ended June 30, 2023, as compared to $321 for the six months ended

June 30, 2023.

The number of employees increased compared to the prior period and officer compensation increased in conjunction with

contract renewals.

compensation increased by $62, or 147.6%, to $104 for the six months ended June 30, 2024, as compared to $42 for the six months ended

June 30, 2023.

The increase related to the issuance of stock options and restricted awards to our officers, employees, board of

directors, and advisors.

marketing, Amazon fees increased by $435 or 167.3%, to $695 for the six months ended June 30, 2024, as compared to $260 for the six months

ended June 30, 2023.

The increase is due to the increased Amazon selling fees and increase in advertising and marketing attributable

to promoting Kenkoderm and Silly George.

and shareholder services decreased by $87 or 36.7%, to $150 for the six months ended June 30, 2024, as compared to $237 for the six months

ended June 30, 2023.

general, and administrative expenses increased by $1,975 or 75.1%, to $4,604 for the nine months ended September 30, 2024, as compared

to $2,629 for the nine months ended September 30, 2023.

The increase in selling, general, and administrative expenses is primarily attributable

to increased Advertising, marketing and Amazon fees, which directly correlates to our growth in branded consumer products.

and benefits increased by $253, or 51.6%, to $743 for the nine months ended September 30, 2024, as compared to $490 for the nine months

ended September 30, 2023.

The number of employees increased compared to the prior period and officer compensation increased in conjunction

with contract renewals.

compensation increased by $137, or 125.7%, to $246 for the nine months ended September 30, 2024, as compared to $109 for the nine months

ended September 30, 2023.

The increase related to the issuance of stock options and restricted awards to our officers, employees, board

of directors, and advisors.

marketing, Amazon fees increased by $1,255 or 286.5%, to $1,693 for the nine months ended September 30, 2024, as compared to $438 for

the nine months ended September 30, 2023.

The increase is due to the increased Amazon selling fees and increase in advertising and marketing

attributable to promoting Kenkoderm and Silly George.

and shareholder services decreased by $126 or 39.0%, to $197 for the nine months ended September 30, 2024, compared to $323 for the nine

months ended September 30, 2023.

The decrease is due to a net reduction of investor services compared to the prior year period.

taxes and corporate insurance decreased by $42 or 34.4%, to $80 for the six months ended June 30, 2024, as compared to $122 for the six

months ended June 30, 2023.

taxes and corporate insurance decreased by $56 or 32.2%, to $118 for the nine months ended September 30, 2024, as compared to $174 for

the nine months ended September 30, 2023.

In the prior year period, a non-recurring adjustment resulted in an increase in franchise taxes.

and consulting fees increased by $213 or 38.6% to $765 for the six months ended June 30, 2024, as compared to $552 for the six

months ended June 30, 2023.

We continued to incur accounting and consulting fees associated with public company governance requirements and professional

services related to branded consumer products.

expenses increased by $34, or 28.6%, to $153 for the six months ended June 30, 2024 from $119 for the six months ended June 30,

and consulting fees increased by $317 or 38.5% to $1,140 for the nine months ended September 30, 2024, as compared to $823 for the nine

months ended September 30, 2023.

We continued to incur accounting and consulting fees associated with public company governance requirements

and professional services related to branded consumer products.

expenses increased by $117, or 48.8%, to $357 for the nine months ended September 30, 2024 from $240 for the nine months ended September

Other Selling, general and administrative expenses generally consist of normal costs associated with our selling efforts and

1 unchanged sentence

and development expenses .

Research and development expenses decreased by $6, or 7.1% to $78 for the six months ended June 30, 2024

from $84 for the six months ended June 30, 2023.

Research and development expenses are related to research costs incurred for potential

products for existing or new customers.

Research and development expenses decreased by $12, or 13.3% to $78 for the nine months ended September

30, 2024 from $90 for the nine months ended September 30, 2023.

Research and development expenses are related to research costs incurred

for potential products for existing or new customers.

and Capital Resources

Flow (in thousands)

Net cash used in operating activities

Net cash provided by (used in) investing activities

Net cash provided by (used in) financing activities

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents at beginning of year

Cash and cash equivalent at end of quarter

of June 30, 2024, we had $1,069 of cash and cash equivalents , compared to $2,700 of cash

and cash equivalents at December 31, 2023.

Net cash used in operating activities was $1,792 and $1,926 for the six months ended June

30, 2024 and 2023, respectively.

cash used in investing activities was $704 and net cash provided by investing activities was $ 4,519 for the six months ended June 30,

2024 and 2023, respectively, consisting of the sales of marketable securities of $57, the purchase

of capital equipment of $361 and the acquisition of $400 for six months ended June 30, 2024 and consisting of the sales of marketable

securities of $4,772 and purchases of capital equipment of $253 for six months ended June 30, 2023.

cash provided by financing activities for the six months ended June 30, 2024 was $865 consisting of net proceeds from the RDO of

$946 and an investment of $37 by a joint venture partner, offset by principal payments of notes payable of $27, a change in contingent consideration liability of $69, and by principal

payment on financing lease liability of $22.

Net cash used in financing activities for June 30, 2023 was $3 is attributable to the

principal payments of notes payable.

June 30, 2024, current assets totaled $3,588 and current liabilities totaled $2,633 as compared to current assets totaling $5,052

cash used in operating activities

cash provided by (used in) investing activities

cash provided by financing activities

increase (decrease) in cash and cash equivalents

and cash equivalents at beginning of year

and cash equivalent at end of quarter

of September 30, 2024, we had $1,059 of cash and cash equivalents, compared to $2,700 of cash and cash equivalents at December 31, 2023.

Net cash used in operating activities was $3,008 and $2,649 for the nine months ended September 30, 2024 and 2023, respectively.

cash used in investing activities was $712 and net cash provided by investing activities was $4,729 for the nine months ended September

30, 2024 and 2023, respectively, consisting of the sales of marketable securities of $62, the purchase of capital equipment of $374 and

the Silly George acquisition of $400 for nine months ended September 30, 2024 and consisting of the sales of marketable securities of

$5,340 and purchases of capital equipment of $611 for nine months ended September 30, 2023.

cash provided by financing activities for the nine months ended September 30, 2024 was $2,079 consisting of net proceeds from the February

Offering and August Offering of $1,950, an investment of $37 by a joint venture partner, and from the margin line of credit of $345,

offset by principal payments of notes payable of $36, a change in contingent consideration liability of $164, and by principal payment

on financing lease liability of $53.

Net cash used in financing activities for the nine months ended September 30, 2023 was attributable

to the proceeds from the margin line of credit of $89 thousand and principal payments of notes payable and convertible notes of $4.

September 30, 2024, current assets totaled $4,610 and current liabilities totaled $3,048 as compared to current assets totaling $5,052

and current liabilities totaling $2,549 at December 31, 2023.

As a result, we had working capital of $955 at June 30, 2024, compared

As a result, we had working capital of $1,562 at September 30, 2024, compared

to a working capital of $2,503 at December 31, 2023.

The change in the working capital as of June 30, 2024 is primarily

attributable to the loss from operations of $1,925, cash paid for asset acquisition of $403, capital expenditures of $361, offset by

net proceeds of $946 from the RDO.

The change in the working capital as of September 30, 2024 is primarily attributable

to the loss from operations of $2,713, cash paid for asset acquisition of $400, capital expenditures of $374, offset by net proceeds

of $1,950 from the February Offering and August Offering.

have never declared or paid any cash dividends on our common stock.

10 unchanged sentences

value creation.

believe we have sufficient capital to maintain as a going concern due to the recent capital raise on August 8, 2024 (discussed further

within Note 19).

We believe we have sufficient cash and marketable securities to operate our business plan into 2025.

We intend to maintain

and attempt to grow our existing contract manufacturing business.

We also plan to continue building and developing our catalog of consumer

products for sale to branding partners and to use our in-house capabilities to create and test market additional branded products.

products will be target marketed and sold online through social media, television and online marketplaces.

Furthermore, the Company plans

to develop its own proprietary medical devices and explore drug delivery programs for its technology.

Additionally, the Company continues

to evaluate strategic initiatives (e.g., acquisitions) and additional capital raises through debt or equity may be necessary to achieve

these objectives.

Our recent capital raise expected to close on or about

November 13, 2024 provides working capital necessary to continue our strategic objectives (discussed further within Note 19).

to maintain and attempt to grow our existing contract manufacturing business.

We also plan to continue building and developing our catalogue

of consumer products for sale to branding partners and to use our in-house capabilities to create and test market additional branded products.

These products will be target marketed and sold online through social media, television and online marketplaces.

Furthermore, the Company

plans to develop its own proprietary medical devices and explore drug delivery programs for its technology.

Additionally, the Company

continues to evaluate strategic initiatives (e.g., acquisitions) and additional capital raises through debt or equity may be necessary

to achieve these objectives.

expect to continue incurring losses for the near-term future.

12 unchanged sentences

Balance Sheet Arrangements

of June 30, 2024, we had no off-balance sheet arrangements in the nature of guarantee contracts, retained or contingent interests in

assets transferred to entities (or similar arrangements serving as credit, liquidity or market risk support to entities for any such

of September 30, 2024, we had no off-balance sheet arrangements in the nature of guarantee contracts, retained or contingent interests

in assets transferred to entities (or similar arrangements serving as credit, liquidity or market risk support to entities for any such

assets), or obligations (including contingent obligations) arising out of variable interests in entities providing financing, liquidity,

45 unchanged sentences

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 2. Management’s Discussion and Analysis