What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-11-13 compared with 2023-08-10 · 135 added, 137 removed, 195 unchanged (58% of the section changed)

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Sunshine Biopharma

are a pharmaceutical company offering and researching life-saving medicines in a wide variety of therapeutic areas, including

oncology and antivirals.

In addition to conducting our own drug development operations, we operate two wholly owned subsidiaries:

are a pharmaceutical company offering and researching life-saving medicines

in a wide variety of therapeutic areas, including oncology and antivirals.

In addition to pursuing our own drug development program, we

operate two wholly owned subsidiaries:

(i) Nora Pharma Inc.

(“Nora Pharma”), a Canadian corporation with a portfolio consisting of 50 generic prescription

drugs on the market in Canada and 27 additional drugs scheduled to be launched during the next 18 months, and (ii) Sunshine

Biopharma Canada Inc.

(“Nora Pharma”), a Canadian corporation with a portfolio consisting

of 51 generic prescription drugs on the market in Canada and 32 additional drugs scheduled to be launched in Canada in 2024 and 2025,

and (ii) Sunshine Biopharma Canada Inc.

(“Sunshine Canada”), a Canadian corporation which develops and sells nonprescription

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containing new research results and extending coverage to include the Coronavirus Papain-Like protease, PLpro.

June 2021, we initiated another R&D project in which we set out to determine if certain mRNA molecules can be used as anticancer

The data obtained for mRNA molecules bearing the laboratory name K1.1 became the subject of a new patent application filed in

October 2022, we acquired Nora Pharma, a Canadian generic pharmaceuticals

company based in the greater Montreal area.

Nora Pharma has 41 employees and operates in a 15,000 square foot facility certified by Health

Nora Pharma currently sells 50 generic prescription drugs in Canada.

The consolidated financial statements contained in this report

include the results of operations of Nora Pharma and Sunshine Canada.

June 2021, we initiated another R&D project in which we set out to determine if certain

mRNA molecules can be used as anticancer agents.

The data obtained for mRNA molecules bearing

the laboratory name K1.1 became the subject of a new patent application filed in April 2022.

October 2022, we acquired Nora Pharma, a Canadian generic pharmaceuticals company based in the greater Montreal area.

Nora Pharma has

41 employees and operates in a 15,000 square foot facility certified by Health Canada.

Nora Pharma currently sells 51 generic prescription

drugs in Canada.

The consolidated financial statements contained in this report include the results of operations of Nora Pharma and

Sunshine Canada.

Prescription Drugs on the Market

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Candesartan HCTZ

Atacand Plus®

Anti-inflammatory

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Cardiovascular

Dapagliflozin

Central nervous system

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Central nervous system

Olanzapine ODT

Central nervous system

Cardiovascular

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Olmetec Plus®

Gastroenterology

Central nervous system

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Micardis Plus®

Anticonvulsant

Tramadol Acetaminophen

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Prescription Drugs Pipeline

addition to the 50 drugs on the market, we currently have the following roster of generic prescription drugs scheduled to be

launched later this year and in 2024:

addition to the 51 drugs on the market, we currently have the following

roster of generic prescription drugs scheduled to be launched in 2024 and 2025:

Group A (2 Products)

Nervous System, Gastrointestinal, Urology

Under Regulatory Review

Group B (1 Product)

Cardiovascular,

Under manufacturing

Group B (6 Products)

Oncology, Gastroenterology,

Under regulatory review

Group C (3 Products)

Nervous System, Cardiovascular, Metabolism

Central Nervous System,

Diabetes , CNS*

Under regulatory review

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Group E (16 Products)

Cardiovascular, Oncology, Anti-infectives

Under Regulatory Review

Cardiovascular, Oncology,

Anti-infectives, Anti-inflammatory, Diabetes, Gastroenterology, CNS*

Soon to be under regulatory

* Central Nervous

believe the addition of these products to our existing portfolio will strengthen our presence in the Canadian generic drugs marketplace

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Oncology (Pancreatic Cancer)

IND-Enabling Studies

9 - Subsequent Events

K1.1 (mRNA LNP)

Oncology (Liver Cancer)

Animal Testing

SBFM-PL4 (Small Molecule)

Antiviral (COVID-19)

Animal Testing

To be determined

Anticancer Drug

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Patents Number 8,236,935 and 10,272,065.

is a GEM-difluorinated C-glycoside derivative of Podophyllotoxin.

Another derivative of Podophyllotoxin called Etoposide is currently

on the market and is used to treat various types of cancer including leukemia, lymphoma, testicular cancer, lung cancer, brain cancer,

prostate cancer, bladder cancer, colon cancer, ovarian cancer, liver cancer and several other forms of cancer.

Etoposide is one of the

most widely used anticancer drugs.

Adva-27a and Etoposide are similar in that they both attack the same target in cancer cells, namely

the DNA unwinding enzyme, Topoisomerase II.

Unlike Etoposide however, Adva-27a has the advantage of being able to penetrate and destroy

Multidrug Resistant Cancer cells.

In addition, Adva-27a has been shown to have distinct and more desirable biological and pharmacological

properties compared to Etoposide.

In side-by-side studies using Multidrug Resistant Breast Cancer cells and Etoposide as a reference,

Adva-27a showed markedly greater cell killing activity (see Figure 1).

February 2023, we signed a research agreement with the Jewish General Hospital (“JGH”), to complete the IND-enabling studies.

The JGH has also agreed to negotiate with us the terms for Phase I Clinical Trials.

Adva-27a’s initial indication will be pancreatic

cancer for which there are currently little or no treatment options available.

All aspects of the clinical trials in Canada will employ

FDA standards at all levels.

December 2022, we entered into a research agreement with the Jewish General Hospital (“JGH”), to conduct the IND-enabling

studies of Adva-27a (the “Research Agreement”).

In August 2023, we were informed by the JGH that the lab results on testing

of the Adva-27a molecule were not favorable.

After conclusion of an internal review of the lab results on November 2, 2023, we provided

notice to JGH of termination of the Research Agreement.

We have now paused the IND-enabling studies of Adva-27a pending a review of the

possibility of chemical modification of the compound to address the suboptimal performance of the molecule in certain studies.

Anticancer mRNA

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Coronavirus Treatment

initial genome expression products following infection by Betacoronavirus,

the causative agent of COVID-19, are two large polyproteins, referred to as pp1a and pp1ab.

These two polyproteins are cleaved at 15 specific

sites by two virus encoded proteases, called Mpro and PLpro, to generate 16 different non-structural proteins essential for viral replication.

Mpro and PLpro represent attractive anti-viral drug development targets as they play a central role in the early stages of viral replication.

PLpro is of particular interest as a therapeutic target in that, in addition to processing essential viral proteins, it is also responsible

for suppression of the human immune system making the virus more life-threatening.

PLpro is present only in Betacoronaviruses, the subgroup

of Coronaviruses represented by the highly pathogenic SARS-CoV, MERS-CoV, and SARS-CoV-2.

initial genome expression products following infection by Betacoronavirus, the causative agent of COVID-19, are two large polyproteins,

referred to as pp1a and pp1ab.

These two polyproteins are cleaved at 15 specific sites by two virus encoded proteases, called Mpro and

PLpro, to generate 16 different non-structural proteins essential for viral replication.

Mpro and PLpro represent attractive anti-viral

drug development targets as they play a central role in the early stages of viral replication.

PLpro is of particular interest as a therapeutic

target in that, in addition to processing essential viral proteins, it is also responsible for suppression of the human immune system

making the virus more life-threatening.

PLpro is present only in Betacoronaviruses, the subgroup of Coronaviruses represented by the

highly pathogenic SARS-CoV, MERS-CoV, and SARS-CoV-2.

Anti-Coronavirus research effort has been focused on developing an inhibitor of PLpro and, on May 22, 2020, we filed a patent application

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of the technology related to the Research Project.

the evolution of the COVID-19 pandemic to its current state, we have expanded our objective to develop a late-preclinical injectable

candidate of first-in-class PLpro inhibitor to treat SARS-CoV2 (and potentially SARS-CoV and MERS-CoV) infection in patients who could

not use Paxlovid, Molnupiravir, or Remdesivir, due to concerns about drug interaction and possible ‘rebound’ infections and

other side effects.

have recently expanded our objective to include the development of an injectable candidate of first-in-class PLpro inhibitor to

treat SARS-CoV2 and potentially SARS-CoV and MERS-CoV infection in patients who could not use Paxlovid, Molnupiravir, or

Remdesivir, due to concerns about drug interaction and possible ‘rebound’ infections and other side effects.

are the sole owner of all worldwide rights pertaining to Adva-27a.

These patent rights are covered by PCT/FR2007/000697 and

PCT/CA2014/000029.

The patent applications filed under these two PCT's have been issued in the United States (US Patent Number

8,236,935 and 10,272,065), Europe, and Canada.

These patent rights are covered by PCT/FR2007/000697 and PCT/CA2014/000029.

The patent applications filed under these two PCT's have been issued in the United States (US Patent Number 8,236,935 and 10,272,065),

Europe, and Canada.

May 22, 2020, we filed a provisional patent application in the United States for a new treatment for Coronavirus infections.

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mRNA molecules.

recently acquired wholly owned subsidiary, Nora Pharma, owns 179 Drug Identification Numbers (“DIN’s”) issued by Health

Our wholly owned subsidiary, Nora Pharma, owns 180 Drug Identification Numbers (“DIN’s”) issued by Health

Canada for prescription drugs currently on the market in Canada.

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of Operations

of results of operations for the three months ended June 30, 2023 and 2022

the three months ended June 30, 2023, we generated $5,560,865 in sales, compared to $150,307 for the three months ended June 30, 2022,

of results of operations for the three months ended September 30, 2023 and 2022

the three months ended September 30, 2023, we generated $5,957,668 in sales, compared to $132,808 for the three months ended September

30, 2022, an increase of $5,824,860.

The increase is attributable to sales generated by our recently acquired wholly owned subsidiary, Nora Pharma.

The direct cost for generating these sales was $3,608,118 (64.9%) for the three months ended June 30, 2023, compared to $74,683 (49.7%)

for the three months ended June 30, 2022.

The increase in the cost of goods sold in 2023 is due to the cost of manufacturing the generic

prescription drugs sold by Nora Pharma.

Our gross profit grew to $1,952,747 for the three months ended June 30, 2023, compared to $75,624

for the three months ended June 30, 2022.

and administrative expenses during the three-month period ended June 30, 2023 were $2,942,370, compared to $771,420 during the three-month

period ended June 30, 2022, an increase of $2,170,950.

This increase was the result of increased overhead associated with being a Nasdaq

listed company and expenses related to Nora Pharma operations.

Specifically, we incurred increased costs in accounting ($34,221), consulting

($290,771), office ($304,978), research and development ($322,622), salaries ($960,167) and taxes ($96,649).

Overall, we incurred a loss

of $989,623 from our operations for the three months ended June 30, 2023, compared to a loss of $695,796 from our operations in the three-month

period ended June 30, 2022.

addition, we had net interest income of approximately $175,453 during the three months ended June 30, 2023, compared to a net interest

income of approximately $146,043 during the three months ended June 30, 2022, as a result of interest earned on cash on hand.

a result, we incurred a net loss of $902,108 ($0.02 per share) for the three months ended June 30, 2023, compared to a net loss of $538,872

($0.03 per share) for the three-month period ended June 30, 2022.

of results of operations for the six months ended June 30, 2023 and 2022

the six months ended June 30 2023, we generated revenues of $10,454,918,

compared to revenue of $272,952 for the six months ended June 30, 2022, an increase of $10,181,966.

The increase is attributable to sales

generated by our recently acquired wholly owned subsidiary, Nora Pharma.

The direct cost for generating these revenues was $6,674,049

for the six months ended June 30, 2023 (63.8%), compared to $134,528 (49.3%) for the six months ended June 30, 2022.

The increase in the

cost of goods sold in 2023 is due to the cost of manufacturing the generic prescription drugs sold by Nora Pharma.

Our gross profit increased

to $3,780,869 for the six months ended June 30, 2023, compared to a gross profit of $138,424 for the same period in 2022.

and administrative expenses during the six-month period ended June 30, 2023 were $6,599,473 compared to $2,057,584 during the six-month

period ended June 30, 2022, an increase of $4,541,889.

This increase was the result of increased overhead associated with being a Nasdaq

listed company and expenses related to Nora Pharma operations.

Specifically, we incurred increased costs in accounting ($130,171), consulting

($416,888), office costs ($504,931), research and development ($393,895), salaries ($2,640,424) and taxes ($160,367).

Overall, we incurred

a loss of $2,818,604 from our operations in the six-month period ended June 30, 2023, compared to a loss from operations of $1,919,160

in the similar period of 2022.

addition, we had net interest income of approximately $348,259 during the six months ended June 30, 2023, compared to a net interest

income of approximately $133,182 during the six months ended June 30, 2022, as a result of interest earned on cash on hand.

a result, we incurred a net loss of $2,604,538 ($0.09 per share) for the six-month period ended June 30, 2023, compared to a net loss

of $1,775,106 ($0.18 per share) for the six-month period ended June 30, 2022.

The increase is attributable to sales generated by our wholly owned subsidiary,

The direct cost for generating these sales was $3,967,412 (66.6%) for the three months ended September 30, 2023, compared

to $65,783 (49.5%) for the three months ended September 30, 2022.

The increase in the cost of goods sold in 2023 is due to increased

cost of manufacturing of the generic prescription drugs sold by Nora Pharma.

Our gross profit grew to $1,990,256 for the three months

ended September 30, 2023, compared to $67,025 for the three months ended September 30, 2022.

and administrative expenses during the three-month period ended September 30, 2023, were $2,769,730, compared to $1,785,005 during the

three-month period ended September 30, 2022, an increase of $984,725.

This increase was the result of increased overhead associated with

being a Nasdaq listed company and expenses related to Nora Pharma operations.

Specifically, we incurred increased costs in consulting

($58,929), office ($467,397), salaries ($549,377) and taxes ($52,586).

Overall, we incurred a loss of $779,474 from our operations for

the three months ended September 30, 2023, compared to a loss of $1,717,980 from our operations in the three-month period ended September

addition, we had net interest income of $168,904 during the three months ended September 30, 2023, compared to a net interest income

of approximately $260,936 during the three months ended September 30, 2022, as a result of interest earned on cash on hand.

a result, we incurred a net loss of $651,482 ($0.04 per share) for the three months ended September 30, 2023, compared to a net loss

of $1,457,019 ($0.08 per share) for the three-month period ended September 30, 2022.

of results of operations for the nine months ended September 30, 2023 and 2022

the nine months ended September 30 2023, we generated revenues of $16,412,586, compared to revenues of $405,760 for the nine months ended

September 30, 2022, an increase of $16,006,826.

The increase is attributable to sales generated by our recently acquired wholly owned

subsidiary, Nora Pharma.

The direct cost for generating these revenues was $10,641,461 (64.8%) for the nine months ended September 30,

2023, compared to $200,311 (49.4%) for the nine months ended September 30, 2022.

The increase in the cost of goods sold in 2023 is due

to increased cost of manufacturing of the generic prescription drugs sold by Nora Pharma.

Our gross profit increased to $5,771,125 for

the nine months ended September 30, 2023, compared to a gross profit of $205,449 for the same period in 2022.

and administrative expenses during the nine-month period ended September 30, 2023 were $9,369,203 compared to $3,842,589 during the nine-month

period ended September 30, 2022, an increase of $5,526,614.

This increase was the result of increased overhead associated with being

a Nasdaq listed company and expenses related to Nora Pharma operations.

Specifically, we incurred increased costs in accounting ($63,608),

consulting ($475,817), office costs ($972,328), research and development ($269,407), salaries ($3,239,801) and taxes ($212,953).

we incurred a loss of $3,598,078 from our operations in the nine-month period ended September 30, 2023, compared to a loss from operations

of $3,637,140 in the similar period of 2022.

addition, we had net interest income of $517,163 during the nine months ended September 30, 2023, compared to a net interest income of

$394,118 during the nine months ended September 30, 2022, as a result of interest earned on cash on hand.

a result, we incurred a net loss of $3,256,020 ($0.12 per share) for the nine-month period ended September 30, 2023, compared to a net

loss of $3,232,125 ($0.26 per share) for the nine-month period ended September 30, 2022.

and Capital Resources

As of June 30,

As of September

30, 2023, we had cash or cash equivalents of $18,846,140.

cash used in operating activities was $5,628,146 during the six months ended June 30, 2023, compared to $1,878,010 during the six-month

period ended June 30, 2022.

cash used in operating activities was $6,085,435 during the nine months ended September 30, 2023, compared to $3,001,746 during the nine-month

period ended September 30, 2022.

The increase was a result of the addition of Nora Pharma’s operations.

flows used in investing activities were $405,779 for the six months ended June 30, 2023, compared to $0 for the six months ended June

flows used in investing activities were $386,920 for the nine months ended September 30, 2023, compared to $0 for the nine months ended

September 30, 2022.

The increase was the result of cash invested in Nora Pharma.

flows provided by financing activities were $3,519,672 during the six

months ended June 30, 2023, compared to $41,561,363 during the six months ended June 30, 2022.

The decrease was primarily as a result

of one offering made during the six months ended June 30, 2023, compared to three offerings completed in February, March, and April 2022,

and due to our purchase of $506,822 in common stock in the first quarter of 2023.

flows provided by financing activities were $3,456,106 during the nine months ended September 30, 2023, compared to $41,561,363 during

the nine months ended September 30, 2022.

The decrease was primarily as a result of one offering made during the nine months ended September

30, 2023, compared to three offerings completed in February, March, and April 2022, and due to our repurchase of a total of $540,629

in common stock in the first and third quarter of 2023.

are not generating adequate revenues from our operations to fully implement our business plan as set forth herein.

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There is no assurance our estimates will be

estimates that we will need additional capital in the amount of approximately $30 million for expansion of our drug development activities

and generic pharmaceuticals operations, including possibly a Phase I clinical trial.

estimates that we will need additional capital in the amount of approximately $30 million

for expansion of our drug development activities and generic pharmaceuticals operations,

including possibly a Phase I clinical trial.

Additional capital may not be available on terms

acceptable to us, or at all.

Currently, we do not have any firm committed arrangements for financing and can provide no assurance that

we will be able to obtain financing when required.

No assurance can be given that we will obtain access to capital markets in the future

or that financing, adequate to satisfy the cash requirements of implementing our business will be available on acceptable terms.

inability to obtain acceptable financing could have an adverse effect upon the results of our operations and financial condition.

Currently, we do not have any committed arrangements for

financing and can provide no assurance that we will be able to obtain financing when required.

No assurance can be given that we will obtain access to capital markets in the future or

that financing, adequate to satisfy the cash requirements of implementing our business will

be available on acceptable terms.

Our inability to obtain acceptable financing could have

an adverse effect upon the results of our operations and financial condition.

Accounting Estimates

discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been

prepared in accordance with accounting principles generally accepted in the United States.

The preparation of these financial statements

requires us to make estimates and judgments that affect the amounts of assets, liabilities, revenues and expenses, and related disclosure

of contingent assets and liabilities.

On an on-going basis, we evaluate our estimates based on historical experience and on various other

assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about

the carrying values of assets and liabilities that are not readily apparent from other sources.

Actual results may differ

from these estimates under different assumptions or conditions.

discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have

been prepared in accordance with accounting principles generally accepted in the United States.

The preparation of these financial

statements requires us to make estimates and judgments that affect the amounts of assets, liabilities, revenues and expenses, and

related disclosure of contingent assets and liabilities.

On an on-going basis, we evaluate our estimates based on historical

experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form

the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions or conditions.

a detailed list of significant accounting policies, please see our annual report on Form 10-K for the fiscal year ended December 31,

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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