Sunshine Biopharma Inc. 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Report of Independent Registered Public Accounting Firm Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholders of Sunshine Biopharma, Inc. Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Sunshine Biopharma, Inc. as of December 31, 2024 and 2023 and the related consolidated statements of operations and comprehensive loss, shareholders’ equity, and cash flows, for the period ended December 31, 2024 and 2023, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of Sunshine Biopharma, Inc. as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the entity’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to Sunshine Biopharma, Inc. in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Sunshine Biopharma, Inc. is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters Critical audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters. /s/ Bush & Associates CPA LLC We have served as the Company’s auditor since 2024. Henderson, Nevada April 1, 2025 PCAOB ID Number 6797 22 Sunshine Biopharma Inc. Consolidated Balance Sheets December 31, December 31, 2024 2023 ASSETS Current Assets: Cash and cash equivalents $ 9,686,529 $ 16,292,347 Accounts receivable 3,868,418 2,552,362 Inventory 11,278,105 5,734,755 Prepaid expenses 1,133,297 310,591 Total Current Assets 25,966,349 24,890,055 Long-Term Assets: Property & equipment 546,055 365,868 Intangible assets 3,019,717 1,444,259 Deferred tax asset 92,234 – Right-of-use-asset 936,037 646,779 Total Long-Term Assets 4,594,043 2,456,906 TOTAL ASSETS $ 30,560,392 $ 27,346,961 LIABILITIES Current Liabilities: Accounts payable & accrued expenses $ 5,543,085 $ 2,585,466 Earnout payable 295,797 2,547,831 Income tax payable 268,276 299,869 Current portion - right-of-use-liability 207,756 118,670 Total Current Liabilities 6,314,914 5,551,836 Long-Term Liabilities: Deferred tax liability – 48,729 Right-of-use-liability 744,724 539,035 Total Long-Term Liabilities 744,724 587,764 TOTAL LIABILITIES 7,059,638 6,139,600 SHAREHOLDERS' EQUITY Preferred Stock, Series B $ 0.10 par value per share; 1,000,000 shares authorized; 130,000 and 10,000 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively 13,000 1,000 Common Stock, $ 0.001 par value per share; 3,000,000,000 shares authorized; 2,580,098 and 14,012 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively 2,580 14 Capital paid in excess of par value 93,354,907 84,415,900 Accumulated comprehensive income ( 829,959 ) 696,105 Accumulated (Deficit) ( 69,039,774 ) ( 63,905,658 ) TOTAL SHAREHOLDERS' EQUITY 23,500,754 21,207,361 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 30,560,392 $ 27,346,961 See Accompanying Notes To These Financial Statements 23 Sunshine Biopharma Inc. Consolidated Statement Of Operations and Comprehensive Loss December 31, December 31, 2024 2023 Revenues $ 34,874,283 $ 24,092,787 Cost of sales 24,204,489 15,753,616 Gross profit 10,669,794 8,339,171 General & Administrative Expenses: Accounting 967,614 463,705 Consulting 925,188 850,173 Director fees 400,000 400,000 Legal 875,698 512,199 Marketing 940,278 734,248 Office 3,110,026 2,142,355 Patent fees – 14,108 R&D 933,902 1,855,830 Salaries 7,718,677 5,712,968 Taxes 387,005 289,737 Depreciation & amortization 223,527 149,147 Total General & Administrative Expenses 16,481,915 13,124,470 (Loss) from operations ( 5,812,121 ) ( 4,785,299 ) Other Income (expense): Foreign exchange gain (loss) ( 44,082 ) ( 245 ) Interest income 496,003 811,974 Interest expense ( 8,774 ) ( 137,308 ) Total Other Income (Expense) 443,147 674,421 Net (loss) before income taxes ( 5,368,974 ) ( 4,110,878 ) Provision for income taxes ( 234,858 ) 395,166 Net (Loss) $ ( 5,134,116 ) $ ( 4,506,044 ) Other comprehensive income: Gain (Loss) from foreign exchange translation ( 1,526,064 ) 534,258 Comprehensive (Loss) $ ( 6,660,180 ) $ ( 3,971,786 ) Earnings (Loss) per common share (Basic & Diluted) $ ( 7.32 ) $ ( 351.36 ) Weighted Average Common Shares Outstanding (Basic & Diluted) 701,749 12,825 See Accompanying Notes To These Financial Statements. 24 Sunshine Biopharma Inc. Consolidated Statements of Cash Flows December 31, December 31, 2024 2023 Cash Flows From Operating Activities: Net (Loss) $ ( 5,134,116 ) $ ( 4,506,044 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 223,527 149,147 Income tax benefit – – Stock issued for services 12,000 – Accounts receivable ( 2,338,195 ) ( 594,141 ) Inventory ( 6,006,864 ) ( 2,365,549 ) Prepaid expenses ( 207,167 ) ( 21,143 ) Accounts Payable & accrued expenses 3,983,749 ( 1,364,134 ) Earn-out payable ( 2,252,034 ) – Income tax payable ( 812,080 ) ( 73,247 ) Net Cash Flows (Used In) Operating Activities ( 12,531,180 ) ( 8,775,111 ) Cash Flows From Investing Activities: Reduction in right-of-use asset ( 341,534 ) 131,949 Purchase of intangible assets ( 322,258 ) ( 705,848 ) Purchase of equipment ( 1,657,055 ) ( 82,251 ) Net Cash Flows (Used In) Investing Activities ( 2,320,847 ) ( 656,150 ) Cash Flows From Financing Activities: Proceeds from public offering net (common stock) 8,522,411 4,089,218 Exercise of warrants 3,558,812 3,502 Purchase of treasury stock ( 3,139,651 ) ( 541,143 ) Lease liability 347,935 ( 125,990 ) Net Cash Flows Provided by Financing Activities 9,289,507 3,425,587 Cash and Cash Equivalents at Beginning of Period 16,292,347 21,826,437 Net increase (decrease) in cash and cash equivalents ( 5,562,520 ) ( 6,005,674 ) Effect of exchange rate changes on cash – ( 62,674 ) Foreign currency translation adjustment ( 1,043,298 ) 534,258 Cash and Cash Equivalents at End of Period $ 9,686,529 $ 16,292,347 Supplementary Disclosure of Cash Flow Information: Cash paid for income taxes $ 582,483 $ – Cash paid for interest $ 8,126 $ – Stock issued for services $ 12,000 $ – See Accompanying Notes To These Financial Statements 25 Sunshine Biopharma Inc. Consolidated Statements of Shareholders' Equity Number Of Common Shares Common Capital Paid in Excess of Par Number Of Preferred Shares Preferred Compre- hensive Accumulated Issued Stock Value Issued Stock Income Deficit Total Balance December 31, 2023 14,012 $ 14 $ 84,415,900 10,000 $ 1,000 $ 696,105 $ ( 63,905,658 ) $ 21,207,361 Preferred Stock issued to related party – – – 120,000 12,000 – – 12,000 Common stock and pre-funded warrants issued in an underwritten offering 13,214 13 8,522,398 – – – – 8,522,411 Exercise of warrants 2,552,872 2,554 3,556,260 – – – – 3,558,812 Repurchase of warrants – – ( 3,139,651 ) – – – – ( 3,139,651 ) Net (loss) – – – – – ( 1,526,064 ) ( 5,134,116 ) ( 6,660,180 ) Balance at December 31, 2024 2,580,098 $ 2,580 $ 93,354,907 130,000 $ 13,000 $ ( 829,959 ) $ ( 69,039,774 ) $ 23,500,754 Balance December 31, 2022 11,293 $ 11 $ 80,864,326 10,000 $ 1,000 $ 161,847 $ ( 59,399,614 ) $ 21,627,570 Repurchase of Stock ( 257 ) – ( 541,143 ) – – – – ( 541,143 ) Common stock and prefunded warrants issued in a private offering 1,225 1 4,089,217 – – – – 4,089,218 Exercise of warrants 1,751 2 3,500 – – – – 3,502 Net (loss) – – – – – 534,258 ( 4,506,044 ) ( 3,971,786 ) Balance at December 31, 2023 14,012 $ 14 $ 84,415,900 10,000 $ 1,000 $ 696,105 $ ( 63,905,658 ) $ 21,207,361 See Accompanying Notes To These Financial Statements 26 Sunshine Biopharma Inc. Notes to Consolidated Financial Statements December 31, 2024 and 2023 Note 1 – Description of Business The Company was incorporated under the name Mountain West Business Solutions, Inc. on August 31, 2006, in the State of Colorado. Effective October 15, 2009, the Company acquired Sunshine Biopharma Inc. in a transaction classified as a reverse acquisition. Upon completion of the reverse acquisition, the Company changed its name to Sunshine Biopharma Inc. and began operating as a pharmaceutical company. Sunshine Biopharma has two wholly owned subsidiaries: (i) Nora Pharma Inc. (“Nora Pharma”), a Canadian corporation through which we currently have 70 generic prescription drugs on the market in Canada, and (ii) Sunshine Biopharma Canada Inc. (“Sunshine Canada”), a Canadian corporation through which we develop and sell nonprescription over-the-counter (“OTC”) supplements. The Company operates the two subsidiaries as a single business segment. The Company is not subject to material customer concentration risks as it sells its products directly to pharmacies in several Canadian Provinces. However, Provincial governments in Canada reimburse patients for their prescription drug expenditures to various degrees under drug reimbursement programs, making generic drugs prices highly dependent on governmental policies which may change over time. The most recent negotiations between the pan-Canadian Pharmaceutical Alliance (“pCPA”) and the Canadian Generic Pharmaceutical Association resulted in updated generic pricing for certain products which took effect on October 1, 2023. The updated prices are valid for three years and the agreement contains an option to extend for an additional two years. On February 10, 2024, the Pharmacare Act became law in Canada making the Canadian federal government another payor in the generic drugs reimbursement program of the Canadian healthcare system. The Canadian federal government has set aside $ 1.5 billion CAD to launch Pharmacare. This development further strengthens the Canadian generic drugs market, the Company’s current focus. In addition, the Company is engaged in the development of the following proprietary drugs: · K1.1 mRNA, a lipid nano-particle (LNP) targeted for liver cancer · SBFM-PL4, a protease inhibitor for treatment of Coronavirus infections 27 Note 2 – Summary of Significant Accounting Policies This summary of significant accounting policies is presented to assist the reader in understanding the Company's financial statements. The consolidated financial statements and notes are representations of the Company's management, which is responsible for their integrity and objectivity. These accounting policies conform to Generally Accepted Accounting Principles in the United States (“GAAP”) and have been consistently applied in the preparation of the financial statements. PRINCIPLES OF CONSOLIDATION The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries, Nora Pharma Inc. and Sunshine Biopharma Canada Inc., both wholly owned. All intercompany accounts and transactions have been eliminated in consolidation. USE OF ESTIMATES The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The more significant estimates and assumptions made by management are valuation of equity instruments, depreciation of property and equipment, and deferred tax asset valuation. Actual results could differ from those estimates as the current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions. There has been no change in the Company’s estimates since December 31, 2023. TRADE ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS Trade accounts receivable are stated at net realizable value. The majority of customers are not extended credit and therefore time to maturity for receivables is short. On a periodic basis, management evaluates its trade accounts receivable and determines whether to record an allowance for doubtful accounts or if any accounts should be written off based on a past history of write-offs, collections and current credit conditions. A receivable is considered past due if the Company has not received payments based on agreed-upon terms. The Company generally does not require any security or collateral to support its receivables. As of December 31, 2024 and 2023, the balances of accounts receivable were $ 3,868,418 and $ 2,552,362 , respectively. INVENTORY VALUATION The Company’s inventory is comprised of finished goods. Inventory is valued at the lower of cost and net realizable value. Cost is determined using the first in, first out method. Net realizable value is the estimated selling price in the ordinary course of business, less the costs necessary to make the sale. The cost of inventory includes the purchase price and other costs directly attributable to the acquisition of the finished goods. The Company regularly reviews inventories to determine if the carrying value exceeds net realizable value and, when determined necessary, a reserve to reduce the carrying value to net realizable value is recorded. As of December 31, 2024 and 2023, there was no reserve for obsolescence. CASH AND CASH EQUIVALENTS For the Balance Sheets and Statements of Cash Flows, all highly liquid investments with maturity of 90 days or less are considered to be cash equivalents. The Company had a cash balance of $ 9,686,529 and $ 16,292,347 as of December 31, 2024 and December 31, 2023, respectively. At times such cash balances may be in excess of the FDIC limit of $ 250,000 in the U.S. or the equivalent in Canada. 28 PROPERTY AND EQUIPMENT Property and equipment are reviewed for recoverability when events or changes in circumstances indicate that its carrying value may exceed future undiscounted cash inflows. As of December 31, 2024 and 2023, the Company had not identified any such impairment. Repairs and maintenance are charged to operations when incurred and improvements and renewals are capitalized. Property and equipment are stated at cost. Depreciation is calculated according to the following methods at the following annual rates and period for financial reporting purposes and accelerated methods for tax purposes. Their estimated useful lives are as follows: Schedule of estimated useful lives Office Equipment: Straight-line and Declining balance method 5-7 Years / 20% Computer Equipment: Declining balance method 55% Laboratory Equipment: Straight-line method 5 Years Vehicles: Straight-line and Declining balance method 5 Years / 30% INTANGIBLE ASSETS Intangible assets are amortized over their estimated useful lives according to the following methods at the following annual rates and period: Schedule of intangible assets estimated useful lives Licenses: Straight-line method 5 Years Website: Declining balance method 55% Intangible assets are tested for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. The carrying amount of a long-lived asset is not recoverable when it exceeds the sum of the undiscounted cash flows expected to result from its use and eventual disposal. In such a case, an impairment loss must be recognized and is equivalent to the excess of the carrying amount of a long-lived asset over its fair value. INTELLECTUAL PROPERTY RIGHTS - PATENTS AND LICENSES The cost of patents and licenses acquired is capitalized and is amortized over the remaining life of the patents or licenses. The Company evaluates recoverability of identifiable intangible assets whenever events or changes in circumstances indicate that intangible assets carrying amount may not be recoverable. Such circumstances include but are not limited to: (i) a significant decrease in the market value of an asset, (ii) a significant adverse change in the extent or manner in which an asset is used, or (iii) an accumulation of cost significantly in excess of the amount originally expected for the acquisition of an asset. The Company measures the carrying amount of such assets against the estimated undiscounted future cash flows associated with it. BASIC AND DILUTED NET GAIN (LOSS) PER SHARE The Company computes gain or loss per share in accordance with ASC 260 – Earnings per Share . ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic net income (loss) per share is calculated by dividing net gain (loss) by the weighted-average common shares outstanding. Diluted net income (loss) per share is calculated by dividing net income (loss) by the weighted-average common shares outstanding during the period using the treasury stock method or the two-class method, whichever is more dilutive. As the Company incurred net losses for the years ended December 31, 2024 and 2023, no potentially dilutive securities were included in the calculation of diluted earnings per share as the impact would have been anti-dilutive. 29 INCOME TAXES In accordance with ASC 740 – Income Taxes , the provision for income taxes is computed using the asset and liability method. The liability method measures deferred income taxes by applying enacted statutory rates in effect at the balance sheet date to the differences between the tax basis of assets and liabilities and their reported amounts on the financial statements. The resulting deferred tax assets or liabilities have been adjusted to reflect changes in tax laws as they occur. A valuation allowance is provided when it is more likely than not that a deferred tax asset will not be realized. The Company expects to recognize the financial statement benefit of an uncertain tax position only after considering the probability that a tax authority would sustain the position in an examination. For tax positions meeting a “more-likely-than-not” threshold, the amount to be recognized in the financial statements will be the benefit expected to be realized upon settlement with the tax authority. For tax positions not meeting the threshold, no financial statement benefit is recognized. As of December 31, 2024, the Company had no uncertain tax positions. The Company recognizes interest and penalties, if any, related to uncertain tax positions as general and administrative expenses. The Company currently has no federal or state tax examinations nor has it had any federal or state examinations since its inception. To date, the Company has not incurred any interest or tax penalties. For Canadian and U.S. tax purposes, the Company’s 2021 through 2023 tax years remain open for examination by the tax authorities under the normal three-year statute of limitations. FUNCTIONAL CURRENCY The U.S. dollar is the functional currency of the Company which is operating in the United States. The functional currency for the Company's Canadian subsidiaries is the Canadian dollar. The Company translates its Canadian subsidiaries' financial statements into U.S. dollars as follows: · Assets and liabilities are translated at the exchange rate in effect as of the financial statement date. · Income statement accounts are translated using the weighted average exchange rate for the period. The Company includes translation adjustments from currency exchange and the effect of exchange rate changes on intercompany transactions of a long-term investment nature as a separate component of shareholders’ equity. There are currently no transactions of a long-term investment nature, nor any gains or losses from non-U.S. currency transactions. CONCENTRATION OF CREDIT RISKS Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash equivalents and trade receivables. The Company places its cash equivalents with high credit quality financial institutions. FINANCIAL INSTRUMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS The Company applies the provisions of accounting guidance, ASC 825 – Financial Instruments . ASC 825 requires all entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. As of December 31, 2024 and 2023, the fair value of cash, accounts receivable and notes receivable, accounts payable, accrued expenses, and other payables approximated carrying value due to the short maturity of the instruments, quoted market prices or interest rates which fluctuate with market rates. 30 The Company defines fair value as the price that would be received to sell an asset or be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). · Level 1 – Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. · Level 2 – Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. If the asset or liability has a specified (contractual) term, a Level 2 input must be observable for substantially the full term of the asset or liability. · Level 3 – Level 3 inputs are unobservable inputs for the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date. The carrying value of financial assets and liabilities recorded at fair value is measured on a recurring or nonrecurring basis. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. The Company had no financial assets or liabilities carried and measured on a nonrecurring basis during the reporting periods. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. NOTES PAYABLE Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortized cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognized in the income statement over the period of the borrowings using the effective interest method. The Company had no notes payable as of December 31, 2024 and 2023. REVENUE RECOGNITION Over 99% of the Company’s revenues are derived from the sale of pharmaceutical products. Pharmaceutical products can only be sold to a specific customer that is either a registered pharmacy or a registered wholesaler. The Company therefore sells only to customers registered with Health Canada, the Canadian equivalent of the FDA. Contracts are drawn up between the wholesalers and the Company for all indirect sales. In the case of direct sales to pharmacies, purchase orders are used instead of contracts. A purchase order, forecast, or other written instructions to purchase any of the Company’s products placed by the customer constitutes an irrevocable offer to purchase. The customer is responsible for ensuring that the terms of any such order are complete and accurate. The purchase order is only deemed to be accepted when the Company (in its sole discretion) accepts the purchase order and delivers on the purchase. The acceptance of any purchase order can be full or partial, at the sole discretion of the Company. No variations to these conditions are binding on the Company unless agreed to in writing between the customer and the Company. No significant judgments are made in connection with any contracts as the price is already determined, the collection is reasonably assured, and performance obligation is fulfilled when the customer receives the goods. The Company is not required to apply any specific judgments, estimations, or assumptions to determine the price of its products. 31 Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Shipping and handling costs associated with outbound freight after control over a product has been transferred to a customer are accounted for as a fulfillment cost and are included in cost of revenues. The amount invoiced for each product is fixed at the Company’s current price list on the date of shipping and known in advance by the customer and does not vary. The Company is involved in a singular activity which is to sell pharmaceutical finished goods. The Company fulfills its performance obligation when the customer receives the requested products. When the products leave the Company's warehouse, the transport to the customer is insured and the transfer of ownership to the customer takes place when the customer receives goods. At this point, the Company issues an invoice for the products and remits the applicable sales taxes (GST and QST) to the appropriate governmental agency. The revenue is recognized when the invoice is issued. Unless otherwise agreed to and signed by both parties, payment terms are within 30 days of the date of the invoice. The collection is reasonably assured because of the nature of the Company’s customers. The Company is conducting sales only in Canada. Prices are listed in Canadian dollars and may vary from one Province or Territory to another within Canada. All products sold by the Company are labelled and approved for sale in Canada only and are not intended for export outside of Canada. In the event of any breach by the Company of any product warranty (whether by reason of defective materials, production faults or otherwise), the Company’s liability is limited to, at Company’s option, (i) replacement of the product(s) in question, or (ii) reimbursement of the purchase price. The Company carries product insurance and is not liable for products’ failure to comply with the warranty of products if the failure or damage arises because of the customer’s negligence, deliberate damage, misuse or failure to store the products in conditions per Health Canada specifications. The Company is not liable (whether in contract, in tort or otherwise) for any (i) indirect, special or consequential loss or damage, or (ii) loss of profit, goodwill, business or revenue (in each case whether direct or indirect). These conditions also apply to any replacement products supplied by the Company. The Company warrants to the customer that, at the time of delivery, the products are compliant with all mandatory quality standards required by applicable regulatory and legal requirements. In return, the customer is required to warrant to the Company that it holds all relevant permits and approvals required under applicable laws to purchase, store, distribute, sell and use the Company’s products. Visible defects or damages must be reported to the Company in writing immediately, but no later than five (5) business days after receipt of the products. Hidden defects must be reported to the Company in writing immediately, but no later than five (5) business days after the customer becomes aware of such defects. The Company shall not be deemed to be in breach of the terms or otherwise liable to customer for any delay in performance or non-performance of its obligations due to circumstances beyond its control, including but not limited to, acts of God, floods, droughts, earthquakes or other natural disasters, terrorist attacks, wars, preparations for war, armed conflicts, civil commotions or riots, epidemics or pandemics, fires, strikes, lockouts, shortages of material or labor, breakdown or damage to machinery or equipment, accidents, any law or governmental order or other regulations or action taken by a governmental entity, or default of any third party suppliers or provider of services or products, or any causes not within the Company’s control. 32 LEASES The Company recognizes and measures its leases in accordance with FASB ASC 842, Leases . The Company is a lessee in a non-cancellable operating lease for office space. The Company determines if an arrangement is a lease, or contains a lease, at inception of a contract and when the terms of an existing contract are changed. The Company recognizes a lease liability and a right-of-use (ROU) asset at the commencement date. The lease liability is initially and subsequently recognized based on the present value of its future lease payments. Variable payments are included in the future lease payments when those variable payments depend on an index or a rate. The discount rate is the implicit rate if it is readily determinable or otherwise the Company uses its incremental borrowing rate. The implicit rates of the Company's lease are not readily determinable and accordingly, the Company uses its incremental borrowing rate based on the information available at the commencement date for all leases. The Company’s incremental borrowing rate for a lease is the 6% interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms and in a similar economic environment. The ROU asset is subsequently measured throughout the lease term at the remaining amount (i.e., present value of the remaining lease payments), plus unamortized initial direct costs, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received, and any impairment recognized. Lease cost for lease payments is recognized on a straight-line basis over the lease term. The Company has elected, for all underlying classes of assets, not to recognize ROU assets and lease liabilities for short-term leases that have a lease term of 12 months or less at lease commencement, and do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise. The Company recognizes the lease cost associated with its short-term leases on a straight-line basis over the lease term. Under the available practical expedient, we account for the lease and non-lease components as a single lease component for all classes of underlying assets as both a lessee and lessor. Further, we elected a short-term lease exception policy on all classes of underlying assets, permitting us to not apply the recognition requirements of this standard to short-term leases (i.e. leases with terms of 12 months or less). RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new pronouncements that have been issued that might have a material impact on its financial position or results of operations. Note 3 – Acquisition of Nora Pharma Inc. On October 20, 2022, the Company acquired all of the issued and outstanding shares of Nora Pharma Inc., a Canadian privately held pharmaceutical company. The purchase price for the shares was $ 18,860,637 which was paid in cash ($ 14,346,637 ) and by the issuance of 3,700,000 shares of the Company’s common stock valued at $ 4,514,000 , or $1.22 per share, on the acquisition date. Nora Pharma sells generic pharmaceutical products in Canada. Nora Pharma’s operations are authorized by a Drug Establishment License issued by Health Canada. 33 The following table summarizes the allocation of the purchase price as of October 20, 2022, the acquisition date using Nora Pharma’s balance sheet assets and liabilities: Schedule of allocation of purchase price Accounts receivable $ 1,358,121 Inventory 3,181,916 Intangible assets 659,571 Equipment & furniture 210,503 Other assets 1,105,093 Total assets 6,515,204 Liabilities assumed ( 5,981,286 ) Net assets 533,918 Goodwill 18,326,719 Total Consideration $ 18,860,637 The value of the 3,700,000 common shares issued as part of the consideration paid for Nora Pharma was determined based on the closing market price of the Company’s common shares on the acquisition date, October 20, 2022 ($1.22 per share). As part of the consideration for Nora Pharma, the Company agreed to a $ 5,000,000 CAD ($ 3,632,000 USD) earnout amount payable to Mr. Malek Chamoun, the seller of Nora Pharma. The earnout is payable in the form of twenty (20) payments of $250,000 CAD for every $1,000,000 CAD increase in gross sales (as defined in the Purchase Agreement) above Nora Pharma’s June 30, 2022 gross sales, provided that his employment with the Company is not terminated pursuant to the Company’s employment agreement with him. The total earnout amount of $3,632,000 has been recorded as a salary payable. During the fiscal year ended December 31, 2023, the Company paid an earnout amount of $ 1,426,914 CAD (approximately $ 1,036,500 USD) for the fiscal year ended December 31, 2022. On April 22, 2024, the Company paid another earnout amount of $ 3,093,878 CAD (approximately $ 2,247,400 USD) for the fiscal year ended December 31, 2023. The Company anticipates that it will pay the remaining earnout balance of $ 479,208 CAD ($ 295,797 USD) in full in April 2025. Note 4 – Goodwill The Company acquired Nora Pharma on October 20, 2022. Allocation of the purchase price per ASC 805-20-25-1 yielded a goodwill amount of $ 18,326,719 . The Company’s used a discounted cash flow model which requires estimating future cash flows expected to be generated from the acquired entity, discounted to their present value using a risk-adjusted discount rate and terminal values. Assessing the recoverability of goodwill requires the Company to make estimates and assumptions about sales, operating margins, growth rates and discount rates based on its budgets, business plans, economic projections, anticipated future cash flows and marketplace data. Management determined that there are inherent uncertainties related to these factors as well as significant risks to cash flows due to ongoing geopolitical and geo-economics conflicts, making the discounted cash flow model unreliable. The following table presents the changes in the carrying amount of goodwill of the Company through December 31, 2024. The provisions of ASC 350-20-50-1 require the disclosure of cumulative impairment. As a result of the acquisition, a new basis in goodwill was recorded in accordance with ASC 805-10. All impairments shown in the table below have been recorded subsequent to the acquisition. The Company had no goodwill on its balance sheet prior to the acquisition: Schedule of goodwill Balance as of December 31, 2021 $ – Acquisition of Nora Pharma (October 20, 2022) 18,326,719 Impairment ( 18,326,719 ) Balance as of December 31, 2022 – Additions in 2023 and 2024 – Balance as of December 31, 2024 $ – 34 Note 5 – Intangible Assets Intangible assets, net, consisted of the following at December 31, 2023 and 2024: Schedule of intangible assets Balance as of December 31, 2022 $ 776,856 Dossier fee additions 710,372 Balance at December 31, 2023 1,487,228 Less accumulated amortization ( 42,969 ) Finite-lived intangible assets, net at December 31, 2023 $ 1,444,259 Balance as of December 31, 2023 $ 1,444,259 Dossier fee additions 1,651,617 Balance at December 31, 2024 3,095,876 Less accumulated amortization ( 76,159 ) Finite-lived intangible assets, net at December 31, 2024 $ 3,019,717 The amortization amounts of intangible assets for 2024 and 2023 were $ 77,009 and $ 38,446 , respectively. As of December 31, 2024, the estimated amortization expense of the Company’s intangible assets for each of the next five years is as follows: Schedule of estimated amortization expense 2025 $ 112,707 2026 111,600 2027 75,293 2028 66,969 2029 22,527 Note 6 – Plant, Property and Equipment Property, plant and equipment are stated at cost. Depreciation of property, plant and equipment begins in the month when the asset is placed into service and is provided using the straight-line method for financial reporting purposes at rates based on the estimated useful lives of the assets. Estimated useful lives range from three to twenty years. Property, plant and equipment consist of the following: Schedule of property and equipment Year Ended December 31, 2024 2023 Equipment $ 336,880 $ 171,859 Computer equipment 53,531 7,368 Furniture and fixtures 50,686 34,132 Leasehold improvements 88,306 17,664 Vehicles 353,185 324,841 Total 882,588 555,864 Less: Accumulated depreciation ( 336,533 ) ( 189,996 ) Plant, property and equipment, net $ 546,055 $ 365,868 Depreciation expense for the years ended December 31, 2024 and 2023 amounted to $ 146,518 and $ 110,701 , respectively. 35 Note 7 – Inventory Inventory is comprised of the following: Schedule of inventory Year Ended December 31, 2024 2023 Finished goods $ 11,278,105 $ 5,734,755 Allowance for obsolete inventory 0 0 Total Inventory, net of allowance $ 11,278,105 $ 5,734,755 Note 8 – Prepaid Expenses The prepaid expenses category is comprised of the following: Schedule of prepaid expenses Year Ended December 31, 2024 2023 Prepaid taxes $ 657,437 $ 9,955 Other prepaid expenses 475,860 300,636 Total $ 1,133,297 $ 310,591 Note 9 – Cost of Sales The Company’s cost of goods sold category is comprised of the following: Schedule of cost of sales Year Ended December 31, 2024 2023 Finished goods $ 8,116,534 $ 5,194,988 Professional allowances 13,047,096 8,670,791 Other allowances 666,913 97,869 Wholesalers fees & discounts 1,699,286 1,395,201 Inventory adjustment 236,555 215,779 Freight 438,105 178,988 Total $ 24,204,489 $ 15,753,616 Note 10 – Reverse Stock Splits Effective April 17, 2024 and August 8, 2024, the Company completed 1-for-100 and 1-for-20 reverse splits of its common stock, respectively. The Company had previously completed three (3) reverse stock splits including a 1-for-200 reverse split on February 9, 2022, and two 1-for-20 reverse splits, one in 2019 and the other in 2020. The Company’s financial statements included in this report reflect all five (5) reverse stock splits on a retroactive basis for all periods presented and for all references to common stock, unless specifically stated otherwise. 36 Note 11 – Capital Stock The Company’s authorized capital is comprised of 3,000,000,000 shares of common stock, par value $ 0.001 , and 30,000,000 shares of preferred stock, $ 0.10 par value. As of December 31, 2024, the Company had authorized 1,000,000 shares of Series B Preferred Stock. The Series B Preferred Stock is non-convertible and non-redeemable. It has a liquidation preference equal to the stated value of $0.10 per share, relative to the common stock and gives the holder the right to 1,000 votes per share. As of December 31, 2024, 130,000 shares of Series B Preferred Stock were outstanding and held by the Company’s Chief Executive Officer. On February 17, 2022, the Company completed a public offering and received net proceeds of $ 6,833,071 . Pursuant to the public offering, the Company issued and sold an aggregate of 941 shares of common stock and 2,051 warrants to purchase shares of common stock (the “Tradeable Warrants”). On March 14, 2022, the Company completed a private placement and received net proceeds of $ 6,781,199 . In connection with this private placement, the Company issued (i) 1,150 shares of its common stock together with investor warrants (“Investor Warrants”) to purchase up to 1,150 shares of common stock, and (ii) 651 pre-funded warrants (“Pre-Funded Warrants”) with each Pre-Funded Warrant exercisable for one share of common stock, together with Investor Warrants to purchase up to 651 shares of common stock. Each share of common stock and accompanying Investor Warrant was sold together at a combined offering price of $4,440 and each Pre-Funded Warrant and accompanying Investor Warrant were sold together at a combined offering price of $4,438. The Pre-Funded Warrants were immediately exercisable, at an exercise price of $2.00, and could be exercised at any time until all of the Pre-Funded Warrants were exercised in full. The Investor Warrants have an initial exercise price of $4,440 per share (subject to adjustment), are exercisable upon issuance and will expire five years from the date of issuance. On April 28, 2022, the Company completed another private placement and received net proceeds of $ 16,752,915 . In connection with this private placement, the Company issued (i) 1,236 shares of common stock together with warrants (“April Warrants”) to purchase up to 2,472 shares of common stock, and (ii) 1,195 pre-funded warrants (“Pre-Funded Warrants”) with each Pre-Funded Warrant exercisable for one share of common stock, together with April Warrants to purchase up to 2,390 shares of common stock. Each share of common stock and accompanying two April Warrants were sold together at a combined offering price of $8,020 and each Pre-Funded Warrant and accompanying two April Warrants were sold together at a combined offering price of $8,018. The Pre-Funded Warrants were immediately exercisable at an exercise price of $2.00, and may be exercised at any time until all of the Pre-Funded Warrants are exercised in full. The April Warrants have an exercise price of $7,520 per share (subject to adjustment), are exercisable upon issuance and will expire five years from the date of issuance. On October 20, 2022, the Company issued 1,850 shares of common stock as part of the acquisition of Nora Pharma. These shares were valued at $ 4,514,000 , or $2,440 per share. On January 19, 2023, the Company announced a stock repurchase program of up to $ 2 million (“Stock Repurchase Program”). During the six months ended June 30, 2023, the Company repurchased a total of 2,228 shares of common stock at an average price of $2,274.20 per share for a total cost of $ 506,822 . The 2,228 repurchased shares were cancelled and returned to treasury, reducing the number of issued and outstanding shares from 11,292 to 9,064. On May 16, 2023, the Company completed a private placement pursuant to a securities purchase agreement with an institutional investor for gross proceeds of approximately $ 5 million, before deducting fees to the placement agent and other offering expenses payable by the Company. The net proceeds received by the Company were $ 4,089,218 . In connection with the private placement, the Company issued (i) 1,225 shares of common stock, (ii) 1,751 pre-funded warrants (the “May Pre-Funded Warrants”), and (iii) investor warrants (the “May Warrants”) to purchase up to 5,952 shares of common stock. Each share of common stock and accompanying two May Warrants were sold together at a combined offering price of $1,680 and each May Pre-Funded Warrant and accompanying two May Warrants were sold together at a combined offering price of $1,678. The May Pre-Funded Warrants are immediately exercisable, at an exercise price of $2.00, and may be exercised at any time until all of the May Pre-Funded Warrants are exercised in full. The May Warrants have an exercise price of $1,180 per share (subject to adjustment as set forth therein), are exercisable upon issuance and will expire five and a half years from the date of issuance. 37 In 2022 and 2023, the Company issued a total of 5,396 shares of common stock in connection with warrant exercises for aggregate net proceeds of $ 13,196,681 . In July 2023, the Company repurchased a total of 34 shares of common stock under the Stock Repurchase Program announced on January 19, 2023, at an average price of $1,009.20 per share for a total cost of $ 34,321 . In October 2023, the 34 repurchased shares were cancelled and returned to treasury reducing the number of issued and outstanding shares from 12,873 to 12,839. On October 12, 2023, the Company held a special meeting of the holders of the outstanding Tradeable Warrants in which the holders of the majority of the outstanding Tradeable Warrants approved an amendment to the Warrant Agent Agreement to eliminate the provision that prohibited the Company’s CEO from exercising his voting rights under the Series B Preferred Stock, as well as to lower the exercise price of the Tradeable Warrants from $4,440 to $220. The Company entered into the amendment to the Warrant Agent Agreement on October 18, 2023. On November 16, 2023, the Company issued 1,173 shares of common stock and received net proceeds of $ 2,346 in connection with the exercise of all 1,173 remaining May Pre-Funded Warrants at an exercise price of $2.00 per share. On February 8, 2024, the Company issued 20,000 shares of Series B Preferred Stock to the Company’s CEO for a purchase price of $ 0.10 per share. On February 15, 2024, the Company completed an underwritten public offering and in connection therewith it issued an aggregate of 35,714 shares of common stock, of which 22,500 shares were issued in connection with pre-funded warrant exercises. On March 4, 2024, the Company issued 100,000 shares of Series B Preferred Stock to the Company’s CEO for a purchase price of $ 0.10 per share. In April and May 2024, the Company issued 1,120,784 shares of common stock in connection with the cashless exercise of all of the Series A Warrants and received $ 0 in net proceeds. On August 16, 2024, the Company issued 150,285 shares of common stock in connection with the rounding up of fractional shares following the reverse stock splits of April 17, 2024 and August 8, 2024. In August and September 2024, the Company issued 678,865 shares of common stock in connection with the exercise of 678,865 Series B Warrants and received aggregate net proceed of $ 1,895,610 . In November and December 2024, the Company issued 580,438 shares of common stock in connection with the exercise of 580,438 Series B Warrants and received aggregate net proceed of $ 1,618,203 . On January 3, 2025, the Company issued 127,443 shares of common stock upon the exercise of 127,443 Series B Warrants and received $ 355,298 in net proceeds. As of December 31, 2024 and December 31, 2023, the Company had a total of 2,580,098 and 14,012 shares of common stock issued and outstanding, respectively. The Company has declared no dividends since inception. 38 Note 12 – Warrants The Company accounts for issued warrants either as a liability or equity in accordance with ASC 480-10 or ASC 815-40. Under ASC 480-10, warrants are considered a liability if they are mandatorily redeemable and they require settlement in cash, other assets, or a variable number of shares. If warrants do not meet liability classification under ASC 480-10, the Company considers the requirements of ASC 815-40 to determine whether the warrants should be classified as a liability or as equity. Under ASC 815-40, contracts that may require settlement for cash are liabilities, regardless of the probability of the occurrence of the triggering event. Liability-classified warrants are measured at fair value on the issuance date and at the end of each reporting period. Any change in the fair value of the warrants after the issuance date is recorded in the consolidated statements of operations as a gain or loss. If warrants do not require liability classification under ASC 815-40, in order to conclude warrants should be classified as equity, the Company assesses whether the warrants are indexed to its common stock and whether the warrants are classified as equity under ASC 815-40 or other applicable GAAP standard. Equity-classified warrants are accounted for at fair value on the issuance date with no changes in fair value recognized after the issuance date. In 2022, 2023, and 2024, the Company completed five (5) financing events, and in connection therewith, it issued warrants as follows: Schedule of warrants issued with financing Type Number Exercise Price Expiry Date 2022 Pre-Funded Warrants 1,846 $ 2.00 Unlimited Tradeable Warrants 2,051 $ 4,440.00 February 2027 Investor Warrants 1,801 $ 4,440.00 ** March 2027 April Warrants 4,862 $ 7,520.00 April 2027 May Pre-Funded Warrants 1,751 $ 2.00 Unlimited May Investor Warrants 5,952 $ 1,180.00 November 2028 2024 Pre-Funded Warrants 22,500 $ 2.00 Unlimited Series A Warrants 3,986 * $ 4,200.00 * August 2026 Series B Warrants 7,973 * $ 4,760.00 * February 2029 * Subject to adjustments per the Series A and Series B Warrant Agreements. The Series B Warrants adjusted to a total of 13,613,297 warrants exercisable at $2.7879 per warrant following the Company’s 1-for-20 reverse stock split on August 8, 2024. ** Subject to adjustment. As of December 31, 2024, all of the 2022 Pre-Funded Warrants, all of the May Pre-Funded Warrants, all of the 2024 Pre-Funded Warrants, a total of 1,569 Tradeable Warrants, 1,401 Investor Warrants, all of the Series A Warrants, and 1,259,303 Series B Warrants (as adjusted) were exercised resulting in aggregate net proceeds of $ 16,752,492 received by the Company. On February 11, 2024, the Company redeemed all of the April Warrants and all of the May Investor Warrants for an aggregate purchase price of $ 3,139,651 . On January 3, 2025, the Company issued 127,443 shares of common stock upon the exercise of 127,443 Series B Warrants and received $ 355,298 in net proceeds. 39 The Company’s outstanding warrants as of December 31, 2024 consisted of the following: Schedule of warrants outstanding Type Number Exercise Price Expiry Date Tradeable Warrants 482 $ 220.00 February 2027 Investor Warrants 400 $ 4,000.00 ** March 2027 Series B Warrants 12,353,992 * $ 2.7879 * February 2029 * As adjusted and subject to further adjustments. In a subsequent event on January 3, 2025, 127,443 Series B Warrants were exercised leaving 12,226,549 warrants remaining outstanding. ** As adjusted. Note 13 – Earnings Per Share The following table* sets forth the computation of basic net income (loss) per share: Schedule of earnings per share computation Year Ended December 31, 2024 2023 Net gain (loss) attributable to common stock $ ( 5,134,116 ) $ ( 4,506,044 ) Weighted average outstanding shares of common stock (Basic & Diluted) 701,749 12,825 Net gain (loss) per share attributable to common stock $ ( 7.32 ) $ ( 351.36 ) * Diluted net gain (loss) per share is not included in this table as the Company incurred net losses for the years ended December 31, 2024 and 2023 and inclusion of dilutive instruments would have an anti-dilutive effect. Note 14 – Income Taxes The components of the provision for income taxes were as follows: Schedule of provision for income taxes Current: Federal $ – State 50 Foreign ( 90,434 ) Current total ( 90,384 ) Deferred: Federal – State – Foreign ( 144,474 ) Deferred total ( 144,474 ) Total $ ( 234,858 ) The Company’s effective tax rate differs from the federal statutory rate as follows: Schedule of income tax expense Pre-Tax Book Income $ ( 1,121,714 ) $ 21.00 % State Taxes 40 0.00 % Other Foreign Taxes ( 119,181 ) 2.23 % Permanent Adjustments 56,092 - 1.05 % Change in Valuation Allowance 569,920 - 10.67 % Foreign Tax Rate Differential 62,181 - 1.16 % Rate Change 149,237 - 2.79 % Provision to Return Adjustments 156,540 - 2.93 % Other 12,027 - 0.23 % Total $ ( 234,858 ) $ 4.40 % 40 The components of the net deferred tax assets and liabilities for the years ended December 31, were as follows: Schedule of components of net deferred tax assets Deferred Tax Assets: 2024 2023 Net Operating Loss, Credits and Carryforwards $ 6,460,638 $ 5,277,829 Fixed Assets – – Intangibles 614,734 641,800 Research and Development 25,327 25,327 Other DTA 95,935 454,890 Lease Liability 252,407 174,292 Valuation Allowance ( 6,967,294 ) ( 6,397,374 ) Deferred Tax Assets 481,747 176,764 Deferred Tax Liabilities: Other DTL ( 67 ) – Fixed Assets ( 141,396 ) ( 54,097 ) Intangibles – – Right-of-Use Asset ( 248,050 ) ( 171,396 ) Deferred Tax Liabilities ( 389,513 ) ( 225,493 ) Net Deferred Tax Liability $ 92,234 $ ( 48,729 ) Note 15 – Leases The Company has obligations as a lessee for office space with initial non-cancellable terms in excess of one year. The Company classified the lease as an operating lease. The lease contains a renewal option for a period of five years. Because the Company is certain to exercise the renewal option, the optional period is included in determining the lease term, and associated payments under the renewal option are included in the lease payments. The Company’s lease does not include termination options for either party to the lease or restrictive financial or other covenants. Payments due under the lease contract include fixed payments plus a variable Payment. The Company’s office space lease requires it to make variable payments for the Company’s proportionate share of building’s property taxes, insurance, and common area maintenance. These variable lease payments are not included in lease payments used to determine lease liability and are recognized as variable costs when incurred. Amounts reported on the balance sheet as of December 31, 2024 were as follows: Schedule of lease information Operating lease ROU asset $ 936,037 Operating Lease liability - Short-term $ 207,756 Operating lease liability - Long-term $ 744,724 Remaining lease term 5 years Discount rate 6 % Amounts disclosed for ROU assets obtained in exchange for lease obligations and reductions of ROU assets resulting from reductions of lease obligations include amounts reduced from the carrying amount of ROU assets resulting from deferred rent. Maturities of lease liabilities under non-cancellable operating leases at December 31, 2024 are as follows: Schedule of maturities of lease liabilities 2025 $ 207,756 2026 $ 197,595 2027 $ 195,760 2028 $ 177,669 2029 $ 168,462 Thereafter $ 13,627 41 Note 16 – Management and Director Compensation The Company paid its officers cash compensation totaling $ 1,850,243 and $ 1,515,000 for the years ended December 31, 2024 and 2023, respectively. Of these amounts attributable to the Company’s CEO, $ 800,000 and $ 0 , respectively was paid to Advanomics Corporation, a company controlled by the CEO of the Company. In addition, the Company’s CEO was paid $12,000 in 2024 through the issuance of 120,000 shares of Series B Preferred Stock valued at $12,000. The Company paid its five directors cash compensation of $80,000 each, totaling $ 400,000 for the years ended December 31, 2024 and 2023. Note 17 – Subsequent Events On January 3, 2025, the Company issued 127,443 shares of common stock upon the exercise of 127,443 Series B Warrants and received $355,298 in net proceeds. Since December 31, 2024, the Company has added 5 new generic prescription drugs to its portfolio, bringing the total number of prescription drugs offered by the Company to 70. 42 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Our financial statements for the fiscal years ended December 31, 2023 and 2022 were audited by BF Borgers CPA, PC (“Borgers”). On May 3, 2024, the Securities and Exchange Commission (the “SEC”) announced that it had settled charges against Borgers that it failed to conduct audits in accordance with the standards of the Public Company Accounting Oversight Board (the “PCAOB”). As part of the settlement, Borgers agreed to a permanent ban on appearing or practicing before the SEC. As a result of Borgers’ settlement with the SEC, we dismissed Borgers as our independent accountant on May 3, 2024. Borgers’ reports on our financial statements for the two most recent fiscal years did not contain an adverse opinion or a disclaimer of opinion, nor was it qualified or modified as to uncertainty, audit scope, or accounting principles. During our fiscal years ended December 31, 2023 and 2022 and the subsequent interim period through May 3, 2024, there were no disagreements, within the meaning of Item 304(a)(1)(iv) of Regulation S-K, with Borgers on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Borgers, would have caused it to make reference to the subject matter of the disagreements in connection with its reports. Also during this same period, there were no reportable events that existed within the meaning of Item 304(a)(1)(v) of Regulation S-K and the related instructions thereto. On May 7, 2024, we retained Bush & Associates CPA LLC (“Bush & Associates”), as our independent registered public accounting firm. The decision to engage Bush & Associates as our independent registered public accounting firm was approved by the unanimous consent of our board of directors.