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Item 2. Management’s Discussion and Analysis

2025-03-14 compared with 2024-12-16 · 94 added, 59 removed, 99 unchanged (61% of the section changed)

10 unchanged sentences

identifying words.

We have based these forward-looking statements

on our current expectations and projections about future events.

We have based these forward-looking statements on

our current expectations and projections about future events.

Although we believe that the expectations underlying our forward-looking

38 unchanged sentences

Promissory Note

On August 14, 2024, we entered into a $300,000

promissory note (the “Note”) with an accredited investor.

On August 14, 2024, we entered into a $300,000 promissory

note (the “Note”) with an accredited investor.

The $300,000 was received on August 22, 2024.

The Note has a one-year

maturity, becoming due on August 22, 2025, and bears interest at the rate of 18% per annum.

In addition, we issued the investor a warrant

to purchase 300,000 shares of our common stock at $0.10 per share that expires August 14, 2029, with a fair value of $13,343.

The Note has a one-year maturity,

becoming due on August 22, 2025, and bears interest at the rate of 18% per annum.

In addition, we issued the investor a warrant to purchase

300,000 shares of our common stock at $0.10 per share that expires August 14, 2029, with a fair value of $13,343.

At January 31, 2025,

$300,000 in principal and $26,149 in accrued interest remained outstanding.

Going Concern

See Note 1 of Notes to Consolidated Financial Statements.

Significant Accounting Policies and Use of

During the three months ended October 31, 2024,

there were no significant changes to our significant accounting policies and estimates as described in Note 2.

Summary of Significant

Accounting Policies included in Part II, Item 8.

of our Annual Report on Form 10-K for the year ended July 31, 2024, which was filed

with the SEC on November 13, 2024.

See Note 1 of Notes to Condensed Consolidated Financial

Significant Accounting Policies and Use of Estimates

During the six months ended January 31, 2025, there

were no significant changes to our significant accounting policies and estimates as described in Note 2.

Summary of Significant Accounting

Policies included in Part II, Item 8.

of our Annual Report on Form 10-K for the year ended July 31, 2024, which was filed with the

SEC on November 13, 2024.

Results of Operations

We do not currently sell or market any products

and we did not have any revenue in the three-month periods ended October 31, 2024 or 2023.

We do not currently sell or market any products and

we did not have any revenue in the three or six-month periods ended January 31, 2025 or 2024.

We will commence actively marketing products

1 unchanged sentence

successful in obtaining FDA clearance or approval for our products.

Three Months Ended

Research and development

Three Months Ended January 31,

Research and development expense

Stock-based compensation

General and administrative

General and administrative expense

Loss from operations

Gain on sale of asset

(15,900,687 )

Investment revaluation

Interest expense

Other income (loss), net

Net income (loss)

(13,497,692 )

Deemed dividend

Net income (loss) attributable to common stockholders

$ (13,434,237 )

Basic net income (loss) per share

Diluted net income (loss) per share

Six Months Ended January 31,

Research and development expense

Stock-based compensation

General and administrative expense

Loss from operations

Unrealized losses on investment

Gain on sale of asset

(16,400,687 )

Investment revaluation

Interest expense

Other income, net

Basic and diluted net loss per share

Research and Development

Research and development relates to our current

projects and includes expenses for clinical research, design and manufacturing, formulation, regulatory and consultants.

Currently, we are not working on any research

and development projects.

Net income (loss)

(13,978,563 )

Deemed dividend

Net income (loss) attributable to common stockholders

$ (1,239,032 )

$ (13,915,108 )

Basic net income (loss) per share

Diluted net income (loss) per share

Research and Development Expense

Our Research and development expense includes expenses

related to our current projects and include clinical research, design and manufacturing, formulation, regulatory and consultants.

We are not currently working on any projects and,

therefore, we did not have any Research and development expense in the three or six months ended January 31, 2025.

Stock-Based Compensation

The decrease in stock-based compensation was due

to fewer awards issued in recent quarters as well as a lower price for our common stock.

The decreases in Stock-based compensation for the

three and six month periods ended January 31, 2025 compared to the same periods of 2024 were due to no options granted in the three and

six month periods ended January 31, 2025 and fewer unvested awards outstanding.

General and Administrative Expense

2 unchanged sentences

as well as stock-based compensation, costs related to maintaining compliance as a public company and legal and professional fees.

The change in General and administrative expense

was due to the following:

Three months ended October 31, 2024 compared to three months ended October 31, 2023

The decreases in General and administrative expense

were due to the following:

Three months ended

January 31, 2025 compared to three months ended

Six months ended

January 31, 2025 compared to six months ended

January 31, 2024

Increase (decrease) in:

Public company expense

Business development and investor relations

Consulting fees

Insurance expense

Legal and professional fees

Bad debt expense

The decreases in wages and business development

and investor relations were due to fewer employees and lower activity throughout the company.

Public Company Expense

The decreases in wages and business development and

investor relations were due to fewer employees and lower activity throughout the company.

The decrease in legal and professional fees

was due to lower legal fees incurred.

Gain on Sale of Asset

The gain on sale of asset in fiscal 2024 relates

to our sale of our drug candidates for treating mild traumatic brain injury (“mTBI”), also known as concussion, and for treating

The gain on sale of asset in fiscal 2024 relates to

our sale of our drug candidates for treating mild traumatic brain injury (“mTBI”), also known as concussion, and for treating

Niemann Pick Disease Type C (“NPC”), as well as our proprietary powder formulation and its nasal delivery device to Oragenics

in December 2023.

Unrealized Losses on Investment

Unrealized losses on investment in relates to

the valuation of the common stock of Oragenics held by us as an investment.

See Notes 3 and 4 of Notes to Consolidated Financial Statements

for additional information.

Interest Expense

Interest expense includes interest on debt outstanding,

as well as the amortization of debt discount and debt issuance costs.

Certain information regarding debt outstanding was as follows:

Three Months Ended October 31,

as well as the amortization of beneficial conversion feature, debt discount and debt issuance costs.

Certain information regarding debt

outstanding was as follows:

Three Months Ended January 31,

Six Months Ended January 31,

Weighted average debt outstanding

Weighted average interest rate

The decreases in interest expense in the three and

six month periods ended January 31, 2025, compared to the same periods of 2024 were due to lower amortization of beneficial conversion

feature, debt discount and debt issuance costs, partially offset by higher average debt outstanding and higher average interest rates.

Liquidity and Capital Resources

See Recent Funding above for a discussion of our recent financings.

See Recent Funding above for a discussion of our recent

The following table sets forth the primary sources and uses of cash:

Three Months Ended October 31,

Six Months Ended January 31,

Net cash used in operating activities

Net cash provided by investing activities

Net cash provided by financing activities

10 unchanged sentences

The following notes payable were outstanding:

October 31, 2024

January 31, 2025

July 31, 2024

Convertible note issued to LGH due December 31, 2024, with a set interest amount of $84,000 through July 7, 2023, then an interest rate of 8.0% per annum of outstanding principal and convertible at $0.072 per share

Promissory notes issued to officers and directors due December 31, 2024, with an interest rate of 8.0% per annum and convertible at $0.12 per share

Accredited investor promissory note due February 13, 2025, with an interest rate of 10% per annum and convertible into 30,000 shares of Oragenics common stock held by us.

Convertible note issued to LGH due July 31, 2025, with a set interest amount of $84,000 through July 7, 2023, then an interest rate of 8.0% per annum of outstanding principal and convertible at $0.072 per share

Promissory notes issued to officers and directors due July 31, 2025, with an interest rate of 8.0% per annum and convertible at $0.12 per share

Accredited investor promissory note due July 31, 2025, with an interest rate of 10% per annum and convertible into 30,000 shares of Oragenics common stock held by us

Mast Hill convertible promissory note due June 13, 2025, with an interest rate of 10% per annum and convertible at $0.072 per share

1 unchanged sentence

Unamortized debt discount and closing costs

Inflation did not have a material impact on our

business and results of operations during the periods being reported on.

Inflation did not have a material impact on our business

and results of operations during the periods being reported on.

Off Balance Sheet Arrangements

We do not have any material off balance sheet

arrangements.

We do not have any material off balance sheet arrangements.

Quantitative and Qualitative Disclosures About Market Risk

We are a smaller reporting company and are not required to provide

information under this item.

We are a smaller reporting company and are not required to provide information

under this item.

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